UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE TO
TENDER OFFER STATEMENT UNDER
SECTION 14(d)(1) OR SECTION 13(e) (1) OF THE SECURITIES EXCHANGE ACT OF 1934
EVERFLOW EASTERN PARTNERS, L.P.
(Name of Issuer)
EVERFLOW EASTERN PARTNERS, L.P. (ISSUER)
(Name of Person Filing Statement)
UNITS OF LIMITED PARTNERSHIP INTEREST
(Title of Class of Securities)
Not Applicable
(CUSIP Number of Class of Securities)
Copy to:
Thomas L. Korner, President Michael D. Phillips, Esq.
Everflow Eastern Partners, L.P. Calfee, Halter & Griswold LLP
585 West Main Street 1400 McDonald Investment Center
Canfield, Ohio 44406 800 Superior Avenue
330-533-2692 Cleveland, Ohio 44114
216-622-8200
(Name, Address and Telephone Number
of Person Authorized to Receive Notices
and Communications on Behalf of Person
Filing Statement)
April 30, 2002
(Date Tender Offer First Published, Sent or Given to Security Holders)
CALCULATION OF FILING FEE
Transaction Valuation: 577,117 Units of Amount of Filing Fee*
Limited Partnership Interest at $ 5.66 per Unit $ 301.00
[ ] Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously
paid. Identify the previous filing by registration statement number, or
the form or Schedule and the date of its filing.
Amount Previously Paid:
----------------------------------------- Not Applicable
Form of Registration No.:
--------------------------------------- Not Applicable
Filing Party:
--------------------------------------------------- Not Applicable
Date Filed:
----------------------------------------------------- Not Applicable
[ ] Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer.
Check the appropriate boxes below to designate any transactions to which the
statement relates:
[ ] third-party tender offer subject to Rule 14d-1.
[X] issuer tender offer subject to Rule 13e-4.
[ ] going-private transaction subject to Rule 13e-3.
[ ] amendment to Schedule 13D under Rule 13d-2.
Check the following box if the filing is a final amendment reporting the results
of the tender offer. [ ]
Item 1. Summary Term Sheet.
Reference is made to the first page of the Offer to Purchase
(the "Offer"), which is incorporated herein by reference.
Item 2. Subject Company Information.
(a) The issuer of the securities to which this statement
relates is Everflow Eastern Partners, L.P., a Delaware limited partnership (the
"Company"). The Company's principal executive offices are located at 585 West
Main Street, Canfield, Ohio 44406, and the Company's telephone number is
330-533-2692.
(b) The securities being sought are up to 577,117 units of
limited partnership interest (the "Units"), at a price of $5.66 per Unit, net to
the sellers in cash (the "Purchase Price"). In its Offer, the Company has
reserved the right to purchase more than 577,117 Units, but has no current
intention of doing so. Reference is hereby made to the Introduction of the
Company's Offer to Purchase, which Introduction is incorporated herein by
reference.
(c) There is currently no established trading market for the
Units. Reference is hereby made to Section 7, "Price Range of Units; Cash
Distribution Policy," which Section is incorporated herein by reference.
Item 3. Identity and Background of Filing Person.
The filer of this statement is Everflow Eastern Partners, L.P.
The Company's principal executive officers are located at 585 West Main Street,
Canfield, Ohio 44406, and the Company's telephone number is 330-533-2692.
Item 4. Terms of the Transaction.
(a) Reference is hereby made to the Introduction, Section 3,
"Procedures for Tendering Units," Section 4, "Withdrawal Rights," Section 11,
"Certain Federal Income Tax Consequences," and Section 13, "Extensions of Tender
Period; Terminations; Amendments," of the Offer to Purchase, which Sections are
incorporated herein by reference.
(b) Reference is hereby made to the Introduction of the Offer
to Purchase, which is incorporated herein by reference.
Item 5. Past Contracts, Transactions, Negotiations and Agreements.
Reference is hereby made to the Introduction, Section 1,
"Background and Purposes of the Offer," and Section 12, "Transactions and
Arrangements Concerning Units," of the Offer to Purchase, which Introduction and
Sections are incorporated herein by reference.
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Item 6. Purpose of the Tender Offer and Plans or Proposals of Issuer or
Affiliate.
(a) Reference is hereby made to the Introduction, Section 1,
"Background and Purposes of the Offer," Section 5, "Purchase of Units; Payment
of Purchase Price," Section 6, "Certain Conditions of the Offer," and Section
10, "Certain Information About the Company; Historical and Pro Forma Financial
Information," of the Offer to Purchase, which Introduction and Sections are
incorporated herein by reference.
(b) Reference is hereby made to Section 5, "Purchase of Units;
Payment of Purchase Price," of the Offer to Purchase, which Section is
incorporated herein by reference.
(c) Not applicable.
Item 7. Source and Amount of Funds or Other Consideration.
(a) The total amount of funds required by the Company to
consummate the transaction and purchase 577,117 Units, pursuant to the Offer,
and to pay related fees and expenses, is estimated to be $3,300,000. Reference
is hereby made to Section 9, "Source and Amount of Funds," which Section is
incorporated herein by reference.
(b) Not applicable.
(d) The Company may need to borrow from its existing credit
facility a portion of the funds required to purchase Units tendered pursuant to
the Offer.
(1) The funds required to purchase tendered Units are
expected to be available from short-term investments and
borrowings under the Company's existing loan agreement. The
amount of availability under the Company's credit facility is
sufficient to fund the borrowed portion of the funds necessary
to purchase 577,117 Units. The existing credit facility,
entered into in August 2001, provides for a line of credit in
the amount of $4,000,000, all of which is available. The
facility provides for interest payable quarterly at LIBOR plus
150 basis points with the principal due at maturity, May 31,
2003. The Company anticipates renewing the facility every
other year to minimize debt origination, carrying and interest
costs associated with long-term bank commitments. Borrowings
under the facility are unsecured; however, the Company has
agreed, if requested by the bank, to execute any supplements
to the agreement including security and mortgage agreements on
the Company's assets. The agreement contains restrictive
covenants requiring the Company to maintain the following: (i)
loan balance not to exceed the borrowing base of $4,000,000;
(ii) tangible net worth of at least $40,000,000; and (iii) a
total debt to tangible net worth ratio of not more than 0.5 to
1.0. In addition, there are restrictions on mergers, sales and
acquisitions, the incurrence of additional debt and the pledge
or mortgage of the Company's assets.
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(2) The Company has no current plans to repay any
such borrowings from any outside sources. The Company will
repay bank debt out of available cash flows generated from
normal operating activities.
Reference is hereby made to Section 9, "Source and Amount of
Funds," and Section 10, "Certain Information About the Company; Historical and
Pro Forma Financial Information," which Sections are incorporated herein by
reference.
Item 8. Interest in Securities of the Subject Company.
Reference is hereby made to Section 12, "Transactions and
Arrangements Concerning Units," of the Offer to Purchase, which Section is
incorporated herein by reference.
BENEFICIAL OWNERSHIP OF UNITS IN THE COMPANY,
EVERFLOW MANAGEMENT LIMITED, LLC AND EMC
Percentage
Interest in
Percentage Everflow Percentage
Name Units of Units Management Interest in
of Holder in Company in Company(1) Limited, LLC(2) EMC
- ----------------------------- ---------- ------------- --------------- ----------
Robert F. Sykes(3) 1,056,464 18.31 66.66 66.66
Thomas L. Korner 135,910 2.35 16.67 16.67
William A. Siskovic 69,066 1.20 16.67 16.67
All officers and directors as
a group (3 persons in EMC) 1,261,440 21.86 100.00 100.00
(1) Does not include the interest in the Company owned indirectly by such
individuals as a result of their ownership in (i) the General Partner
(based on its 1.15% interest in the Company) or (ii) EMC (based on EMC's 1%
managing member's interest in the General Partner).
(2) Includes the interest in the General Partner owned indirectly by such
individuals as a result of their share ownership in EMC resulting from
EMC's 1% managing member's interest in the General Partner.
(3) Includes 732,855 Units held by Sykes Associates, a New York limited
partnership comprised of Mr. Sykes and his wife as general partners and
four adult children as limited partners, 162,462 Units of the Company held
by the Robert F. Sykes Annuity Trust and 161,147 Units held by the
Catherine Sykes Annuity Trust.
Item 9. Persons/Assets Retained, Employed, Compensated or Used.
Not applicable.
Item 10. Financial Statements.
(a) Reference is hereby made to Section 10, "Certain
Information About the Company; Historical and Pro Forma Financial Information,"
of the Offer to Purchase, which Section is incorporated herein by reference.
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(b) Reference is hereby made to Section 10, "Certain
Information About the Company; Historical and Pro Forma Financial Information,"
of the Offer to Purchase, which Section is incorporated herein by reference.
Item 11. Additional Information.
(a) (1) Reference is hereby made to Section 10, "Certain
Information About the Company; Historical and Pro Forma
Financial Information," Section 12, "Transactions and
Arrangements Concerning Units," of the Offer to Purchase,
which Sections are incorporated herein by reference.
(2) None.
(3) Not applicable.
(4) Not applicable.
(5) None.
(b) Reference is hereby made to the Offer to Purchase and the
related Letter of Transmittal, forms of which are attached hereto as Exhibits
(a)(1) and (a)(2), respectively, and are incorporated in their entirety herein
by reference.
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Item 12. Exhibits.
(a)(1) Form of Offer to Purchase, dated April 30, 2002
(a)(2) Form of Letter of Transmittal
(a)(3) Form of 2001 Annual Report Newsletter to Unitholders,
dated April 30, 2002
(a)(4) Annual Financial Statements of the Company and
Management's Discussion and Analysis of Financial
Condition and Results of Operations(4)
(a)(5) Form of letter prepared by Wright & Company, Inc.
(b)(1) Loan Modification Agreement dated August 28, 2001,
between Bank One, N.A., Bank One, Texas, N.A. and
Everflow Eastern, Inc. and Everflow Eastern Partners,
L.P. (3)
(c)(1) Amended and Restated Agreement of Limited Partnership
of the Company, dated as of February 15, 1991(1)
(c)(2) Close Corporation Agreement of Everflow Management
Corporation(1)
(c)(3) Operating Agreement of Everflow Management Limited, LLC
dated March 8, 1999(2)
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
(g) Not applicable.
(h) Not applicable.
- ----------
(1) Incorporated herein by reference to the Company's Schedule 13E-4 filing
dated April 30, 1992. Items not mailed to Unitholders.
(2) Incorporated herein by reference to the Company's Form 10-Q filing for the
quarter ended March 31, 1999. Item not mailed to Unitholders.
(3) Incorporated herein by reference to the Company's Form 10-Q filing for the
quarter ended September 30, 2001. Item not mailed to Unitholders.
(4) Incorporated herein by reference to the Company's Form 10-K filing for the
year ended December 31, 2001. Items mailed to Unitholders.
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SIGNATURE
After due inquiry and to the best of my knowledge and belief,
I certify that the information set forth in this statement is true, complete and
correct.
Date: April 30, 2002 EVERFLOW EASTERN PARTNERS, L.P.
By: EVERFLOW MANAGEMENT LIMITED, LLC
General Partner
By: EVERFLOW MANAGEMENT CORPORATION
Managing Member
By: /s/William A. Siskovic
-----------------------------------------
William A. Siskovic
Vice President and Secretary-Treasurer
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EXHIBITS
Exhibit
Number Description
- ------ -----------
(a)(1) Form of Offer to Purchase, dated April 30, 2002
(a)(2) Form of Letter of Transmittal
(a)(3) Form of 2001 Annual Report Newsletter to Unitholders, dated
April 30, 2002
(a)(4) Annual Financial Statements of the Company and Management's
Discussion and Analysis of Financial Condition and Results of
Operations(4)
(a)(5) Form of letter prepared by Wright & Company, Inc.
(b)(1) Loan Modification Agreement dated August 28, 2001, between
Bank One, N.A., Bank One, Texas, N.A. and Everflow Eastern,
Inc. and Everflow Eastern Partners, L.P. (3)
(c)(1) Amended and Restated Agreement of Limited Partnership of the
Company, dated as of February 15, 1991(1)
(c)(2) Close Corporation Agreement of Everflow Management
Corporation(1)
(c)(3) Operating Agreement of Everflow Management Limited, LLC dated
March 8, 1999(2)
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
(g) Not applicable.
(h) Not applicable.
- ----------
(1) Incorporated herein by reference to the Company's Schedule 13E-4 filing
dated April 30, 1992. Items not mailed to Unitholders.
(2) Incorporated herein by reference to the Company's Form 10-Q filing for the
quarter ended March 31, 1999. Item not mailed to Unitholders.
(3) Incorporated herein by reference to the Company's Form 10-Q filing for the
quarter ended September 30, 2001. Item not mailed to Unitholders.
(4) Incorporated herein by reference to the Company's Form 10-K filing for the
year ended December 31, 2001. Items mailed to Unitholders.
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