-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LF/4TyyIgQRBiT498hmvnks440kzgJoVkjnUOtN1hEh6axlwBAymp4AXvfcHz3xE 7rFhLvM2be0rrJTARErRlg== 0000910647-03-000226.txt : 20030604 0000910647-03-000226.hdr.sgml : 20030604 20030604155814 ACCESSION NUMBER: 0000910647-03-000226 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20030522 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20030604 FILER: COMPANY DATA: COMPANY CONFORMED NAME: WESTERBEKE CORP CENTRAL INDEX KEY: 0000796502 STANDARD INDUSTRIAL CLASSIFICATION: MOTORS & GENERATORS [3621] IRS NUMBER: 041925880 STATE OF INCORPORATION: DE FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-15046 FILM NUMBER: 03732658 BUSINESS ADDRESS: STREET 1: AVON INDUSTRIAL PARK STREET 2: 41 LEDIN DRIVE CITY: AVON STATE: MA ZIP: 02322 BUSINESS PHONE: 5085887700 MAIL ADDRESS: STREET 1: AVON INDUSTRIAL PARK CITY: AVON STATE: MA ZIP: 02322 8-K 1 west-8k4.txt BODY OF FORM 8-K =========================================================================== SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): May 22, 2003 WESTERBEKE CORPORATION (Exact name of Registrant as specified in its Charter) Delaware 0-15046 04-1925880 (State or other Jurisdiction) (Commission (IRS Employer of Incorporation) File Number) Identification No.) Myles Standish Industrial Park 150 John Hancock Road Taunton, MA 02780 (Address of principal executive offices) Registrant's telephone number, including area code: (508) 823-7677 =========================================================================== ITEM 5. Other Events. Subsequent to May 2, 2003, John H. Westerbeke, Jr. ("Mr. Westerbeke"), the Chairman, President and Chief Executive Officer of Westerbeke Corporation (the "Company"), received a preliminary inquiry from a private equity firm about the possibility of purchasing Mr. Westerbeke's beneficial interest in the Company on the terms set forth in its letter of such date (attached hereto as Exhibit 99.1). Mr. Westerbeke referred this inquiry to the special committee. The private equity firm was informed of Mr. Westerbeke's unwillingness to sell any portion of his beneficial interest in the Company to a third party, and since such notification Mr. Westerbeke has not received any further communication from such firm. Also subsequent to May 2, 2003, Mr. Westerbeke received an inquiry from a potential strategic acquiror of the Company regarding the possibility of making an offer to purchase the entire Company at a price in excess of $3.00 per share of common stock. On May 21, 2003, counsel for the potential acquiror sent a letter to Pepe & Hazard LLP (counsel to Mr. Westerbeke and Westerbeke Acquisition Corporation ("Acquisition")), advising that the acquiror expected to make a formal proposal on the terms set forth in such counsel's letter of such date (attached hereto as Exhibit 99.2). The letter was referred to the special committee. Counsel for the special committee subsequently spoke to counsel for the potential acquiror to determine whether the proposal represented the acquiror's highest and best offer. Counsel for the potential acquiror responded that the potential acquiror would consider making a higher offer if, subject to the conditions set forth in such counsel's letter of May 21, 2003, its proposal were to receive the support of Mr. Westerbeke. The special committee also spoke to Mr. Westerbeke, who stated that he would not vote the shares of Company common stock beneficially owned by him (through Acquisition) in favor of such proposal. Counsel for the special committee informed counsel for the potential acquiror of Mr. Westerbeke's position. On May 27, 2003, the special committee received from the potential acquiror a formal offer to acquire the assets of the Company on the terms set forth in its letter of May 23, 2002 (attached hereto as Exhibit 99.3), which terms were not materially different from the terms stated in Exhibit 99.2 hereto. Subsequently, a member of the special committee spoke to Mr. Westerbeke, who again stated that he would not vote the shares of Company common stock beneficially owned by him (through Acquisition) in favor of such offer. On May 28, 2003, the members of the special committee met and voted unanimously to recommend to the board of directors that the Company not pursue the offer. The basis of the special committee's recommendation was that, under Delaware law, the proposed acquisition would require approval by holders of a majority of the Company common stock, and that in light of Mr. Westerbeke's stated opposition to the offer, it would be imprudent to expend Company resources pursuing a transaction that could not be consummated. The special committee reported its recommendation to the board of directors of the Company on May 29, 2003. On the same date, the board of directors (with Mr. Westerbeke abstaining), acting subsequent to the recommendation of the special committee, determined not to pursue the proposed transaction for the same reasons stated by the special committee. Thereafter, counsel for the special committee informed counsel for the potential acquiror of Mr. Westerbeke's position with respect to such offer. In addition, on May 29, 2003, the Chairman of the special committee advised the potential acquiror of the decision of the special committee and the board of directors and the reason therefor. ITEM 7. Financial Statements And Exhibits. (c) Exhibits. The following exhibits are filed with this report: 99.1 Letter regarding the acquisition of Mr. Westerbeke's beneficial interest in Westerbeke Corporation, dated May 2, 2003. 99.2 Preliminary Proposal to Purchase the Assets of Westerbeke Corporation, dated May 21, 2003. 99.3 Offer to Purchase the Assets of Westerbeke Corporation, dated May 24, 2003 3 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. WESTERBEKE CORPORATION Date: June 4, 2003 By: /s/ Gregory Haidemenos --------------------------- Gregory Haidemenos Principal Financial and Accounting Officer 4 EX-99 3 wesk4991.txt EXHIBIT 99.1 EXHIBIT 99.1 MONTGOMERY ADVISORS May 2, 2003 John H. Westerbeke, Jr. Myles Standish Industrial Park Taunton, MA 02780 PERSONAL & CONFIDENTIAL ----------------------- Mr. Westerbeke, We are in the position to purchase your shares in WTBK for $3.50 cash per share. We are prepeared to close on this transaction immediately, provided that you are available for a two year, $500,000 consulting agreement and that concurrent with closing our transaction with you, Montgomery Advisors will assume a majority position on the Board of Directors. Feel free to contact me at 805.895.4700 Sincerely, Ken Sterling, Partner Montgomery Advisors, LLC KWS:rb EX-99 4 wesk4992.txt EXHIBIT 99.2 EXHIBIT 99.2 FALK, SHAFF & ZIEBELL, LLP ATTORNEYS AT LAW 18881 VON KARMAN AVENUE SUITE 1400 IRVINE, CALIFORNIA 92612 TELEPHONE: (949) 660-7700 FACSIMILE: (949) 660-7799 May 21, 2003 By Fax No. 617-695-9255 - ----------------------- Ronald Stetler, Esq. Pepe & Hazard LLP 150 Federal Street Boston, Mass. 02110 RE: Westerbeke Acquisition Corp. Dear Mr. Stetler: As we stated when we spoke to you on Friday May 16th, we are counsel to Valley Detroit Diesel Allison, Inc. ("VDDA"). Your client, Westerbeke Acquisition Corp., has proposed to acquire Westerbeke Corporation ("WTBK"). We write this letter in an effort to promote cooperation and support from Mr. Westerbeke in our client's effort to acquire WTBK. Our client expects to make a formal proposal on the following terms: 1. We will pay WTBK $6,744,090 ($3.45 times 1,954,809 shares outstanding) in cash at closing. 2. We will assume all the liabilities stated on WTBK's balance sheet in the approximate amount of $7.1 million (based on WTBK's first quarter 2003 Form 10Q dated January 25, 2003). 3. We will acquire all of the assets on the WTBK balance sheet and all of WTBK's off-balance sheet assets and intangibles, including but not limited to intellectual property, service marks, trademarks, patents, copyrights, as well as any rights, claims and choses in action. 4. Our client would prefer to have the cooperation, advice and insights of Mr. Westerbeke available to it in the operation of WTBK's business and expects to offer him a three year consulting contract on terms equivalent to a senior executive. Ronald Stetler, Esq. May 21, 2003 Page 2 5. WTBK would agree to distribute the net proceeds of the asset sale to its shareholders. (Mr. Westerbeke would still be able to retain his ownership of the corporation, under a new name, after the public shareholders have been redeemed in full if he desires.) 6. Our client's offer will be conditioned on the unanimous approval of WTBK's board of directors and the requisite percentage of WTBK's shareholders. Our client's terms, as set forth above, offer several collateral benefits for the WTBK shareholders and/or for your client, including (a) higher net proceeds to the WTBK shareholders, (b) the lowering of costs associated with the acquisition, (c) the elimination of potential liabilities and (d) improvement of (rather than harming) the defendant's position in the lawsuit arising from the terms of your client's offer to acquire the shares of WTBK. We believe our client's offer will result in a substantially greater economic benefit to all of the shareholders of WTBK without exposing them to any higher risk or detriment. In addition we strongly believe that VDDA brings significant resources and collateral benefits to the operations of WTBK including its employees. It is not VDDA's intention to sell the properties or to close the plant. Our client would prefer to proceed with your client's cooperation, approval and recommendation, but we are prepared to proceed in any event. We feel that a non-adversarial appoach would maximize the likelihood of an increased benefit to all of WTBK's shareholders and employees as well as our respective clients. We would like to afford your client a reasonable opportunity to consider our preliminary proposal. We respectfully request that you respond by 3 P.M.(EDT)/12 P.M. (PDT) on Tuesday, May 27, 2003 to let us know whether we should proceed with our formal offer to the WTBK board without your clent's support for the acquisition of WTBK's business. Please feel free to call me or my partner, Michael E. Shaff, if you have any questions or concerns about the terms of the foregoing proposed offer. Very truly yours, FALK, SHAFF & ZIEBELL, LLP /s/ Barry D. Falk Barry D. Falk cc: Mr. Peter B. Hill, Jr. Mr. Robert Humphryes Michael E. Shaff 2 EX-99 5 wesk4993.txt EXHIBIT 99.3 EXHIBIT 99.3 Valley Detroit Diesel Allison 425 South Hacienda Boulevard, City of Industry, California 91745 (626) 333-1243 FAX (626) 369-7096 FEDERAL EXPRESS-SATURDAY DELIVERY - --------------------------------- May 23, 2003 James W. Storey Chair of the Special Committee of the Board of Directors Westerbeke Corporation Three Saddle Ridge Road Dover, MA 02030 RE: Offer by Valley Detroit Diesel Allison to Purchase the Assets of Westerbeke Corporation Dear Mr. Storey: Valley Detroit Diesel Allison ("VDDA" or "We") is presenting this offer to purchase all of the assets of Westerbeke Corporation ("WTBK"), subject to the liabilities on WBTK's balance sheet, on the terms and conditions set forth in this letter. The terms of the purchase offer set forth in this letter are conditioned upon the assets and liabilities of WTBK being substantially consistent with the assets and liabilities disclosed on WTBK's first quarter financial statement set forth in the Form 10Q dated January 25, 2003. 1. We will pay WTBK $6,744,090 ($3.45 times the 1,954,809 shares outstanding) in cash at closing. We are confident that our offer will yield each shareholder substantially in excess of $3.00 per share, even after incidental costs of distribution of the proceeds. 2. We will assume all the liabilities stated on WTBK's balance sheet in the approximate amount of $7.1 million (based on WTBK's first quarter 2003 Form 10Q dated January 25, 2003). 3. We will acquire all of the assets on the WTBK balance sheet and all of WTBK's off-balance sheet assets and intangibles, including but not limited to intellectual property, service marks, trademarks, patents, copyrights, as well as any rights, claims and choses in action. The assets will be acquired free and clear of all secured and unsecured debts, mortgages, pledges, liens, charges, security interests, encumbrances and obligations of any kind or nature whatsoever. We shall obtain insurance to protect against the assertion of any undisclosed and unassumed Distributor for: DETROIT DIESEL CORP DEUTZ COPORATION ELECTRO-MOTIVE & ALLISON TRANSMISSION, DIVISIONS OF GENERAL MOTORS CORPORATION Valley Mr. James W. Storey May 23, 2003 Page 2 liabilities (other than those arising out of the conduct of Mr. Westerbeke and the Board in coneection with this transaction). 4. We would prefer to have the cooperation, advice and insights of Mr. Westerbeke available to us in the operation of WTBK's business. The failure to obtain Mr. Westerbeke's cooperation in our purchase of WTBK's assets has limited the amount we are able to offer over and above the amount offered herein. Conversly, Mr. Westerbeke's agreement to cooperate with our purchase will result in our upward revision of the cash portion of the purchase price. 5. WTBK will agree to distribute the net proceeds of the asset sale to its shareholders. (Mr. Westerbeke would still be able to retain his ownership of the corporation, under a new name, after the public shareholders have been redeemed in full if he desires.) 6. Our offer is conditioned on the unanimous approval of WTBK's Special Committee of the Board of Directors and the requisite percentage of WTBK's shareholders. 7. We will compress our due diligence to conform to the deadline of June 12, 2003 imposed by the agreement between WTBK and the Westerbeke Acquisition Corporation ("WAC"). In order to properly conclude our due diligence within the compressed time frame imposed by the terms of your agreement with WAC, we must commence our due diligence no later than June 2, 2003. We will have to obtain WTBK's cooperation in our performance of (a) interviews with key employees and management, (b) accounting diligence, and (c) customary legal and environmental review during the period of June 2, 2003 through June 6, 2003. 8. We will enter a standard form non-disclosure agreement in form acceptable to WTBK's counsel prior to commencing our due diligence review. 9. Given WTBK's agreement to the forgoing terms and the successful completion of our due diligence review, our offer would become firm at 3 P.M. (EDT)/12 P.M. (PDT) on June 10, 2003. 10. We are ready to perform financially and are willing to provide you with substantiation on request. 11. Based on the terms outlined in this letter, the parties will proceed to negotiate a mutually satisfactory asset purchase agreement (the "Definitive Agreement"). The Definitive Agreement will contain terms, conditions, representations, warranties, covenants and non-competition provisions customary and appropriate for the type of transaction contemplated. 2 Valley Mr. James W. Storey May 23, 2003 Page 3 12. Provided that VDDA has presented transaction documents and is prepared to close the transaction on the economic terms outlined herein, if for any reason whatsoever the transaction does not close on the terms and conditions set forth herein, WTBK will pay VDDA a break-up fee of $50,000. The parties acknowledge and agree that, given VDDA's substantial investment of time and resources in due diligence, documentation, planning and related activities associated with the transaction, and the difficulty of quantifying with precision VDDA's losses if the transaction does not occur (including out-of-pocket costs, opportunity costs and other costs) this break-up fee is fair and reasonable compensation to VDDA. 13. Between the date of this letter and the Closing Date, WTBK will have conducted its business and affairs only in the ordinary and usual course, will not have engaged in any activity or entered into any transaction outside of the ordinary and usual course of business and will not have increased the compensation of any director or officer or any other employee, contractor or other person or entity. Prior to the Closing Date, WTBK shall preserve and keep intact its business organization, to keep available to WTBK the services of its present employees and contractors, including its officers, and to preserve for VDDA the goodwill of the contractors, customers, suppliers, creditors and others having business relations with WTBK. In particular, WTBK will not transfer or sell any of its assets other than retail sales in the ordinary course of business. 14. This letter is an expression of the current intentions of the parties only and is not legally binding upon the parties hereto. This letter does not set forth all of the matters upon which agreement must be reached in order for the proposed transaction to be consummated. Notwithstanding anything to the contrary contained in this paragraph, the provisions of paragraphs 11, 12, 13 and 14 of this letter shall be legally binding upon and enforceable against each of the parties hereto. Our terms, as set forth above, offer several collateral benefits for the WTBK shareholders, including (a) higher net proceeds to the WTBK shareholders, (b) the lowering of costs associated with the acquisition, (c) the elimination of potential liabilities and (d) improvement of (rather than harming) the defendant's position in the lawsuit arising from the terms of WAC's offer to acquire the shares of WTBK. We believe our offer will result in a substantially greater economic benefit to all of the shareholders of WTBK without exposing then to any higher risk or detriment. In addition we strongly believe that VDDA brings significant resources and collateral benefits to the operations of WTBK including its employees. It is not VDDA's intention to sell the properties or to close the plant. We would prefer to proceed with your cooperation, approval and recommendation, but we are prepared to proceed in any event. We feel that a non-adversarial approach would maximize the likelihood of an increased benefit to all of WTBK's shareholders and employees. 3 Valley Mr. James W. Storey May 23, 2003 Page 4 We would like to afford you a reasonable opportunity to consider our proposal, consistent with the limited time available for us to conclude our due diligence within the time available. We respectfully request that you respond by 3 P.M. (EDT)/12 P.M. (PDT) on Wednesday May 28, 2003 to let us know your response to our offer to acquire the assets of WTBK. Very truly yours, VALLEY DETROIT DIESEL ALLISON By: /s/ Michael P. Barnett ----------------------------- Michael P. Barnett, President Accepted and Agreed to: WESTERBEKE CORPORATION By: - ---------------------- Date: - ---------------------- cc: H. Clark Lee, Chairman of the Board Peter B. Hill, Jr., Vice President Robert K. Humphryes, CFO Michael E. Shaff, Falk, Shaff & Ziebell, LLP 4 -----END PRIVACY-ENHANCED MESSAGE-----