UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13D*
Under the Securities Exchange Act of 1934
(Amendment No. )*
Aradigm Corp.
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(Name of Issuer)
Common Stock
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(Title of Class of Securities)
038505301
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(CUSIP Number)
Mark Goldstein
First Eagle Investment Management, LLC
1345 Avenue of the Americas
New York, New York 10105
(212) 698-3101
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
June 18, 2010
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(Date of Event which Requires
Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box. [x]
(Continued on following pages)
(Page 1 of 10 Pages)
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* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 (the "Act") or otherwise subject to the liabilities of that section
of the Act but shall be subject to all other provisions of the Act.
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CUSIP NO. 038505301 SCHEDULE 13D PAGE 2 OF 10 PAGES
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1 NAME OF REPORTING PERSON
First Eagle Investment Management, LLC
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
AF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7 SOLE VOTING POWER
61,712,652
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NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY -0-
OWNED BY ---------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON WITH 61,712,652
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10 SHARED DISPOSITIVE POWER
-0-
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
61,712,652
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
43.46% (1)
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14 TYPE OF REPORTING PERSON*
IA
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(1) Assumes that there are 137,778,964 shares of common stock of Aradigm Corp.
outstanding, based on information provided by Aradigm Corp.
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CUSIP NO. 038505301 SCHEDULE 13D PAGE 3 OF 10 PAGES
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1 NAME OF REPORTING PERSON
First Eagle Value in Biotechnology Master Fund, Ltd.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Cayman Islands
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7 SOLE VOTING POWER
31,276,465
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NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY -0-
OWNED BY ---------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON WITH 31,276,465
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10 SHARED DISPOSITIVE POWER
-0-
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON
31,276,465
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
22.36% (1)
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14 TYPE OF REPORTING PERSON*
CO
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(1) Assumes that there are 137,778,964 shares of common stock of Aradigm Corp.
outstanding, based on information provided by Aradigm Corp.
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CUSIP NO. 038505301 SCHEDULE 13D PAGE 4 OF 10 PAGES
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ITEM 1. SECURITY AND ISSUER.
This Schedule 13D relates to the common stock (the "Common Stock") of
Aradigm Corp. (the "Issuer"). The principal executive office of the Issuer is
located at 3929 Point Eden Way, Hayward, California 94545. Information given in
response to each item shall be deemed incorporated by reference in all other
items, as applicable.
ITEM 2. IDENTITY AND BACKGROUND.
(a) This Schedule 13D is being filed by First Eagle Value in Biotechnology
Master Fund, Ltd., a Cayman Islands company ("FEVIBMF"). First Eagle
Investment Management, LLC, a Delaware limited liability company and an
investment adviser registered under the Investment Advisers Act of 1940
("FEIM"), is the investment adviser to FEVIBMF, as well as to 21 April Fund,
Ltd., a Cayman Islands company, 21 April Fund, L.P., a Delaware limited
partnership, DEF Associates N.V., a Netherlands Antilles company, and various
other fiduciary accounts. FEIM is a subsidiary of Arnhold and S. Bleichroeder
Holdings, Inc. ("ASB"). No shares of Common Stock are held directly by ASB.
Each of FEVIBMF and FEIM are referred to herein as a "Reporting Person" or
collectively as "Reporting Persons."
(b) The principal business address of each of the Reporting Persons is 1345
Avenue of the Americas, New York, New York 10105.
(c) The principal business of FEIM consists of investment management.
(d) Neither of the Reporting Persons has, during the last five years, been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors).
(e) Neither of the Reporting Persons has, during the last five years, been a
party to a civil proceeding of a judicial or administrative body of competent
jurisdiction and, as a result of such proceeding, was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws or finding
any violation with respect to such laws.
(f) Not applicable.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
The information set forth in Item 4 hereof is hereby incorporated by reference
into this Item 3, as applicable.
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CUSIP NO. 038505301 SCHEDULE 13D PAGE 5 OF 10 PAGES
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ITEM 4 PURPOSE OF TRANSACTION.
Securities Purchase Agreement
On June 18, 2010, FEVIBMF and the Issuer entered into a Securities Purchase
Agreement (the "Purchase Agreement") pursuant to which FEVIBMF agreed to acquire
from the Issuer an aggregate of 9,716,704 shares of Common Stock, 2,107,620 of
which represent shares of Common Stock underlying warrants (the "Warrant
Shares") that are exercisable upon shareholder approval, which is expected to
occur within 60 days from the transaction date, at a purchase price of $0.1184
per share at a closing on June 21, 2010 (the "Closing"). The source of funds for
the purchase at the Closing was the working capital of FEVIBMF.
Registration Rights Agreement
In connection with the Purchase Agreement, FEVIBMF entered into a Registration
Rights Agreement, dated June 21, 2010 (the "Registration Rights Agreement"),
with the Issuer. The Registration Rights Agreement provides that the Issuer
will file a registration statement to cover the resale of the shares of Common
Stock and the Warrant Shares held by FEVIBMF by July 21, 2010. The failure on
the part of the Issuer to satisfy the deadlines set forth in the Registration
Rights Agreement may subject the Issuer to payment of certain monetary
penalties. Under the terms of the Registration Rights Agreement, the Issuer is
obligated to maintain the effectiveness of one or more registration statements
until all securities covered therein are sold or otherwise can be sold pursuant
to Rule 144 without any restrictions. Under the Registration Rights Agreement,
if there is not an effective registration statement covering all of the
Registrable Securities (as defined in the Registration Rights Agreement) or the
prospectus contained therein is not available for use and the Issuer files a
registration statement relating to an offering for its own account or the
account of others under the Securities Act of 1933, as amended (the "Securities
Act"), of any of its equity securities, FEVIBMF will have the right to include
its shares in the registration statement, subject to customary exceptions.
In addition, pursuant to the terms of the Purchase Agreement, the Issuer has
agreed, among other things, not to file any other registration statement (other
than any registration statement on Form S-8) until the Common Shares and the
Warrant Shares are covered by an effective registration statement or freely
salable under Rule 144 under the Securities Act.
The foregoing descriptions of the Purchase Agreement and the Registration Rights
Agreement (collectively, the "Agreements") do not purport to be complete and are
qualified in their entirety by the terms of each such document, which are
attached hereto as Exhibit 2 and Exhibit 3, respectively, and are incorporated
herein by reference.
Except as set forth herein, the Reporting Persons do not have any contracts,
arrangements, understandings or relationships with respect to any securities of
the Issuer.
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CUSIP NO. 038505301 SCHEDULE 13D PAGE 6 OF 10 PAGES
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Additional Disclosure
The Reporting Persons acquired the shares of Common Stock reported herein for
investment purposes in the ordinary course of its business because they believed
that the shares of Common Stock, when purchased, were undervalued and
represented an attractive investment opportunity. The Reporting Persons intend
to review their investment in the Issuer on a continuing basis and may engage in
discussions with management, the Issuer's board of directors, other shareholders
of the Issuer and other relevant parties concerning matters with respect to the
Reporting Persons' investment in the shares of Common Stock, including, without
limitation, the business, operations, governance, management, strategy and
future plans of the Issuer. Depending on various factors, including, without
limitation, the outcome of any discussions referenced above, the Issuer's
financial position and strategic direction, actions taken by the Issuer's board
of directors, price levels of the shares of Common Stock, other investment
opportunities available to the Reporting Persons, conditions in the securities
markets and general economic and industry conditions, the Reporting Persons may
in the future take such actions with respect to their investment in the Issuer
as they deem appropriate, including, without limitation, purchasing additional
shares of Common Stock or selling some or all of their shares of Common Stock,
engaging in short selling of or any hedging or similar transactions with respect
to the shares of Common Stock and/or otherwise changing their intention with
respect to any and all matters referred to in Item 4 of Schedule 13D.
Other than as described above and as set forth in the Agreements, the Reporting
Persons do not have any plans or proposals which would result in any of the
following:
(a) The acquisition by any person of additional securities of the Issuer, or the
disposition of securities of the Issuer;
(b) An extraordinary corporate transaction, such as a merger, reorganization
or liquidation, involving the Issuer or any of its subsidiaries;
(c) A sale or transfer of a material amount of assets of the Issuer or any of
its subsidiaries;
(d) Any change in the present board of directors or management of the Issuer,
including any plans or proposals to change the number or term of directors or
to fill any existing vacancies on the board;
(e) Any material change in the present capitalization or dividend policy of the
Issuer;
(f) Any other material change in the Issuer's business or corporate structure;
(g) Changes in the Issuer's charter, bylaws or instruments corresponding thereto
or other actions that may impede the acquisition of control of the Issuer by any
person;
(h) Causing a class of securities of the Issuer to be delisted from a national
securities exchange or to cease to be authorized to be quoted in an inter-dealer
quotation system of a registered national securities association;
(i) A class of equity securities of the Issuer becoming eligible for termination
of registration pursuant to Section 12(g)(4) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"); or
(j) Any action similar to any of those enumerated above.
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CUSIP NO. 038505301 SCHEDULE 13D PAGE 7 OF 10 PAGES
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ITEM 5. INTEREST IN SECURITIES OF THE COMPANY.
(a)-(b) FEVIBMF may be deemed, for purposes of Rule 13d-3 under the Exchange
Act, to have sole power to direct the voting and disposition of 31,276,465
shares of Common Stock, 2,107,620 of which represent Warrant Shares underlying
warrants that are exercisable upon shareholder approval, which is expected to
occur within 60 days from the transaction date, representing approximately
22.36% of the 137,778,964 shares of Common Stock outstanding, based on
information provided by the Issuer.
FEIM may be deemed, for purposes of Rule 13d-3 under the Exchange Act, to have
sole power to direct the voting and disposition of 61,712,652 shares of Common
Stock, 4,215,239 of which represent Warrant Shares underlying warrants that are
exercisable upon shareholder approval, which is expected to occur within 60 days
from the transaction date, representing approximately 43.46% of the 137,778,964
shares of Common Stock outstanding, based on information provided by the Issuer.
(c) Except as described in this Schedule 13D, neither of the Reporting Persons
has effected any transaction in the securities of the Issuer in the last 60
days.
(d) No persons other than the Reporting Persons and their investment clients
have the right to participate in the receipt of dividends from, or the proceeds
from the sale of, the shares of Common Stock covered hereby.
(e) Not Applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE COMPANY.
The information set forth in Item 4 hereof is hereby incorporated by reference
into this Item 6, as applicable.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit 1: Joint Filing Agreement as required by Rule 13d-1(k)(1) under the
Securities Exchange Act of 1934, as amended.
Exhibit 2: Securities Purchase Agreement by and among the Issuer and the Buyers
identified therein, dated June 18, 2010 (incorporated by reference to Exhibit
10.1 to the Issuer's Current Report on Form 8-K filed with the Securities and
Exchange Commission on June 21, 2010).
Exhibit 3: Registration Rights Agreement by and among the Issuer and the Buyers
identified therein, dated June 21, 2010 (incorporated by reference to Exhibit
10.2 to the Issuer's Current Report on Form 8-K filed with the Securities and
Exchange Commission on June 21, 2010).
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CUSIP NO. 038505301 SCHEDULE 13D PAGE 8 OF 10 PAGES
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SIGNATURES
After reasonable inquiry and to the best of my knowledge and belief,
each of the undersigned hereby certifies that the information set forth in this
statement is true, complete and correct.
EXECUTED as a sealed instrument this 28th day of June, 2010.
FIRST EAGLE INVESTMENT MANAGEMENT, LLC
By: /s/ Mark Goldstein
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Name: Mark Goldstein
Title: Senior Vice President
FIRST EAGLE VALUE IN BIOTECHNOLOGY MASTER
FUND, LTD.
By: /s/ Mark Goldstein
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Name: Mark Goldstein
Title: Authorized Person
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CUSIP NO. 038505301 SCHEDULE 13D PAGE 9 OF 10 PAGES
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EXHIBIT INDEX
Exhibit 1: Joint Filing Agreement as required by Rule 13d-1(k)(1) under the
Securities Exchange Act of 1934, as amended.
Exhibit 2: Securities Purchase Agreement by and among the Issuer and the Buyers
identified therein, dated June 18, 2010 (incorporated by reference to Exhibit
10.1 to the Issuer's Current Report on Form 8-K filed with the Securities and
Exchange Commission on June 21, 2010).
Exhibit 3: Registration Rights Agreement by and among the Issuer and the Buyers
identified therein, dated June 21, 2010 (incorporated by reference to Exhibit
10.2 to the Issuer's Current Report on Form 8-K filed with the Securities and
Exchange Commission on June 21, 2010).
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CUSIP NO. 038505301 SCHEDULE 13D PAGE 10 OF 10 PAGES
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Exhibit 1
JOINT FILING AGREEMENT PURSUANT TO RULE 13d-1(k)(1)
The undersigned acknowledge and agree that the foregoing statement on Schedule
13D is filed on behalf of each of the undersigned and that all subsequent
amendments to this statement on Schedule 13D shall be filed on behalf of each
of the undersigned without the necessity of filing additional joint filing
statements. The undersigned acknowledge that each shall be responsible for the
timely filing of such amendments, and for the completeness and accuracy of the
information concerning him, her or it contained herein, but shall not be
responsible for the completeness and accuracy of the information concerning the
other entities or persons, except to the extent that he, she or it knows or has
reason to believe that such information is inaccurate.
Date: June 28, 2010
FIRST EAGLE INVESTMENT MANAGEMENT, LLC
By: /s/ Mark Goldstein
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Name: Mark Goldstein
Title: Senior Vice President
FIRST EAGLE VALUE IN BIOTECHNOLOGY MASTER
FUND, LTD.
By: /s/ Mark Goldstein
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Name: Mark Goldstein
Title: Authorized Person