DEFA14A: Twin Vee PowerCats Addresses Stockholder Concerns, Voluntarily Supplements Merger Disclosures with Forza X1

Twin Vee PowerCats Co. is voluntarily providing supplemental disclosures regarding its proposed merger with Forza X1, Inc. to address concerns raised by a purported stockholder regarding the valuation analyses.

Summary

• Twin Vee PowerCats Co. is supplementing its definitive joint proxy statement/prospectus related to its proposed merger with Forza X1, Inc.
• This action comes after Twin Vee received a letter from legal counsel to a purported stockholder who claimed that the Joint Proxy Statement/Prospectus omitted material information regarding the valuation analyses performed by Houlihan Capital.
• Twin Vee denies the claims but is providing supplemental disclosures to avoid potential litigation that could delay or adversely affect the merger approval.
• The supplemental disclosures pertain to the Market Approach used in determining the value of Forza, specifically detailing the traded price and Volume-Weighted Average Price (VWAP).
• Houlihan Capital calculated an indicated equity value range for Forza between $4.9 million and $6.0 million using the market approach.
• Houlihan Capital also utilized the Black-Scholes model to estimate the fair market values of Forzas warrants and options, determining they have little value and do not materially impact the fairness of the transaction.
• The Joint Proxy Statement/Prospectus was mailed on or about October 14, 2024, to Twin Vee stockholders of record as of October 4, 2024.
• Twin Vee and Forza encourage investors and security holders to read the registration statement and the joint proxy statement/prospectus carefully.

Sentiment

Score: 6

Explanation: The sentiment is neutral to slightly positive. While there are concerns raised by a stockholder, the company is proactively addressing them and reaffirming the fairness of the merger. The supplemental disclosures aim to ensure the deal proceeds smoothly.

Positives

• Twin Vee is proactively addressing stockholder concerns to avoid potential delays or adverse effects on the merger with Forza X1.
• The supplemental disclosures provide additional transparency regarding the valuation analyses performed by Houlihan Capital.
• Houlihan Capital concluded that the Merger is fair from a financial point of view to Twin Vee and its shareholders.

Negatives

• A purported stockholder raised concerns about the Joint Proxy Statement/Prospectus omitting material information.
• The need for supplemental disclosures suggests potential weaknesses or lack of clarity in the initial disclosures.

Risks

• The possibility of legal proceedings, despite Twin Vees belief that the claims are without merit.
• The risk that the anticipated benefits of the merger are not realized.
• Potential adverse reactions or changes to business or employee relationships resulting from the announcement or completion of the merger.
• Changes in Twin Vees share price before the closing of the merger.
• Risks relating to the potential dilutive effect of shares of Twin Vee common stock to be issued in the Merger.

Future Outlook

The document outlines the supplemental disclosures related to the proposed merger between Twin Vee and Forza X1, indicating the companies' intent to proceed with the merger, pending stockholder and regulatory approvals. The future outlook depends on the successful completion of the merger and the integration of the two companies.

Management Comments

• Twin Vee believes that the claims asserted by counsel to the purported stockholder are entirely without merit.
• Twin Vee specifically denies that any additional disclosure was or is required.

Industry Context

The merger between Twin Vee PowerCats and Forza X1 reflects a trend of consolidation and strategic partnerships within the marine industry, particularly as companies seek to expand their product offerings and market reach. The focus on electric and hybrid power solutions, as suggested by Forza X1's involvement, aligns with the growing emphasis on sustainable technologies in the boating sector.

Comparison to Industry Standards

• Valuation methodologies like the Market Approach and Black-Scholes model are standard practice in merger and acquisition analysis, ensuring the fairness of the deal to shareholders.
• Comparable company analysis would typically involve examining similar transactions in the marine industry or related sectors to assess the reasonableness of the valuation multiples and exchange ratio.
• Companies like Brunswick Corporation (BC) and Malibu Boats (MBUU) could be considered as benchmarks for Twin Vee, while electric boat manufacturers like X Shore or Torqeedo could be relevant for Forza X1.

Stakeholder Impact

• Shareholders of Twin Vee and Forza will be impacted by the proposed merger, with the potential for value creation through synergies and expanded market opportunities.
• Employees of both companies may experience changes related to the integration of the two businesses.
• Customers could benefit from a broader range of products and services offered by the combined entity.

Next Steps

• Twin Vee and Forza will continue to seek necessary regulatory and shareholder approvals for the merger.
• Investors and security holders are urged to read the registration statement and the joint proxy statement/prospectus carefully.
• The companies will proceed with the merger, pending the satisfaction of all conditions.

Key Dates

Keywords

Merger, Twin Vee, Forza X1, Proxy Statement, Valuation, Houlihan Capital, Stockholder, Disclosures, Exchange Ratio, Black-Scholes, Market Approach