UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 5)
The Eastern Company
(Name of Issuer)
Common Stock, no par value
(Title of Class of Securities)
276317 10 4
(CUSIP Number)
Clay Lifflander
MMI Investments, L.L.C., RR1, Box 167D, Wing Road, Millbrook, NY 12545
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
February 5, 1997
(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 which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box |_|.
Check the following box if a fee is being paid with the statement |_|. (A fee is
not required only if the reporting person: (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
*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 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Page 1 of 27 Pages
- -------------------------------------------------------------------------------
CUSIP No. 276317 10 4 Page 2 of Pages
----------- --------- -----------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
MMI Investments, L.L.C.
TIN 14-1790769
- -------------------------------------------------------------------------------
2 CHECK THE APPROXIMATE BOX IF A MEMBER OF A GROUP* (a) |X|
(b) |_|
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
WC, OO
- --------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) |_|
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- -------------------------------------------------------------------------------
7 SOLE VOTING POWER
178,400
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
----------------------------------------------------
8 SHARED VOTING POWER
0
----------------------------------------------------
9 SOLE DISPOSITIVE POWER
178,400
----------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
178,400
- -------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* |_|
- -------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.61%
- -------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
OO
- -------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
- -------------------------------------------------------------------------------
CUSIP No. 276317 10 4 Page 3 of Pages
----------- --------- -----------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Millbrook Capital Management Inc.
TIN 13-3540644
- -------------------------------------------------------------------------------
2 CHECK THE APPROXIMATE BOX IF A MEMBER OF A GROUP* (a) |X|
(b) |_|
- -------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
AF
- -------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) |_|
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
- -------------------------------------------------------------------------------
7 SOLE VOTING POWER
178,400
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
----------------------------------------------------
8 SHARED VOTING POWER
0
----------------------------------------------------
9 SOLE DISPOSITIVE POWER
178,400
----------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
178,400
- -------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* |_|
- -------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.61%
- -------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- -------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
- -------------------------------------------------------------------------------
CUSIP No. 276317 10 4 Page 4 of Pages
----------- --------- -----------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
John S. Dyson
SSN ###-##-####
- -------------------------------------------------------------------------------
2 CHECK THE APPROXIMATE BOX IF A MEMBER OF A GROUP* (a) |X|
(b) |_|
- -------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
AF
- -------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) |_|
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.
- -------------------------------------------------------------------------------
7 SOLE VOTING POWER
178,400
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
----------------------------------------------------
8 SHARED VOTING POWER
0
----------------------------------------------------
9 SOLE DISPOSITIVE POWER
178,400
----------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
178,400
- -------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* |_|
- -------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.61%
- -------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- -------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
- ------------ ------------------------------------------------------------------
CUSIP No. 276317 10 4 Page 5 of Pages
----------- -------- -----------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Ernst Ohnell
SSN ###-##-####
- -------------------------------------------------------------------------------
2 CHECK THE APPROXIMATE BOX IF A MEMBER OF A GROUP* (a) |X|
(b) |_|
- -------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
PF
- -------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) |_|
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S.
- -------------------------------------------------------------------------------
7 SOLE VOTING POWER
89,800
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
----------------------------------------------------
8 SHARED VOTING POWER
0
----------------------------------------------------
9 SOLE DISPOSITIVE POWER
89,800
----------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
89,800
- -------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
|_|
- -------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.33%
- -------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- -------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
- ------------ ------------------------------------------------------------------
CUSIP No. 276317 10 4 Page 6 of Pages
----------- -------- -----------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
B.W. Elliott Manufacturing Co.
TIN 15-0585760
- -------------------------------------------------------------------------------
2 CHECK THE APPROXIMATE BOX IF A MEMBER OF A GROUP* (a) |X|
(b) |_|
- -------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
WC, BK, OO
- -------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) |_|
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
- -------------------------------------------------------------------------------
7 SOLE VOTING POWER
0
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
----------------------------------------------------
8 SHARED VOTING POWER
0
----------------------------------------------------
9 SOLE DISPOSITIVE POWER
0
----------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
0
- -------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* |_|
- -------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0
- -------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
CO
- -------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
Item 2. Identity and Background
Item 2 of Schedule 13D is amended in its entirety to read as follows:
This statement is being filed by each of the following, who are
collectively referred to herein as the "Reporting Persons":
1. MMI Investments, L.L.C., a Delaware limited liability company ("MMI");
2. Millbrook Capital Management Inc., a New York corporation
("Millbrook");
3. John S. Dyson, sole stockholder, a Director and Chairman of Millbrook;
4. Ernst Ohnell; and
5. B.W. Elliott Manufacturing Co., a New York corporation ("Elliott").
MMI, Millbrook and Mr. Dyson are collectively referred to herein as
the "Millbrook Reporting Persons".
The principal business address for each of the Millbrook Reporting Persons
is RR1, Box 167D, Wing Road, Millbrook, New York 12545.
MMI is a limited liability company organized under the Delaware Limited
Liability Company Act. MMI is primarily engaged in the business of investing in
securities.
Millbrook's principal business is to manage investments in publicly traded
securities as well as in private companies. Millbrook is the Manager of MMI, and
as such, it has the sole power to vote and dispose of investment securities held
by MMI. Millbrook's officers are John S. Dyson, Chairman; Clay B. Lifflander,
President; Alan Rivera, Chief Financial Officer; and David H. Bova, Vice
President (Messrs. Dyson, Lifflander, Rivera and Bova are referred to
collectively herein as the "Millbrook Principals"). The Millbrook Principals are
the directors of Millbrook. The Millbrook Principals and Millbrook are also
members of MMI. On July 16, 1996, Mr. Lifflander revoked the proxy given by Mr.
Dyson to vote the shares of capital stock of Millbrook that Mr. Dyson owns. The
principal business address for the Millbrook Principals is RR1, Box 167D, Wing
Road, Millbrook, New York 12545, and each of them is a United States citizen.
The principal employment for the Millbrook Principals is in their respective
capacities with Millbrook listed above.
Mr. Ohnell's address is 75 Khakum Wood Road, Greenwich, Connecticut 06831.
Mr. Ohnell's principal occupation is as Chief Executive Officer of Ohnell
Capital Corporation, 2 Greenwich Plaza, Suite 100, Greenwich, Connecticut 06803.
Mr. Ohnell is a United States citizen.
Page 7 of 27 Pages
<PAGE>
Elliott's principal business is the manufacturing of flexible shaft and
valve control products for industrial users. The principal business address for
Elliott is 37 Milford Street, Binghamton, New York 13904-1687. The officer of
Elliott is George M. Scherer, Chief Executive Officer. Mr. Scherer's business
address is 37 Milford Street, Binghamton, New York 13904-1687 and he is a United
States citizen. In addition, Messrs. Scherer, Lifflander, Rivera and Bova are
the directors of Elliott (collectively, the "Elliott Principals"). Millbrook
owns 90% and Mr. Scherer owns 10% of the outstanding capital stock of Elliott.
During the last five years, none of the Reporting Persons, Millbrook
Principals or Elliott Principals has been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors, if any).
During the past five years, none of the Reporting Persons, Millbrook
Principals or Elliott Principals has 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.
Item 4. Purpose of Transaction
Item 4 of Schedule 13D is hereby amended in its entirety to read as
follows:
MMI acquired Shares of the Company because MMI believes that trading prices
of the Shares do not adequately reflect the potential value of the Company's
underlying business and assets. MMI initially intended to work with management
to effectuate value enhancement strategies for all stockholders. However, after
meeting with management and studying the Company's operations and industry, MMI
determined that the best means to maximize value for all stockholders is to
effect a sale of the Company.
On July 16, 1996, Millbrook sent a merger proposal to the Chairman of the
Company to have Elliott acquire all outstanding Shares of the Company for $15
per Share in cash (the "Merger Proposal"). The Merger Proposal also indicated
that the merger price would be subject to increase if Eastern could demonstrate
additional value not reflected in its then current stock price. The Merger
Proposal is subject, among other things, to the approval of the Company's Board
of Directors, a majority of the Company's public shareholders indicating support
for the transaction and other customary conditions for transactions of this
nature. On July 18, 1996, and July 24, 1996, Millbrook sent additional
correspondence to the Chairman of the Company contained in Exhibits 9 and 10
hereto.
On July 25, 1996, the Board of Directors of the Company rejected the Merger
Proposal. On July 29, 1996, the Board of Directors of the Company amended the
Company's bylaws to increase the vote required for stockholders to amend the
bylaws from 50% to 75%.
On July 25, 1996 and August 12, 1996, Millbrook, on behalf of MMI, sent
written demands for a list of the Company's stockholders to the Company, which
the Company rejected. On July 31, 1996 and August 6, 1996, MMI commenced actions
which were subsequently withdrawn seeking access to the Company's list of
stockholders.
Page 8 of 27 Pages
<PAGE>
On August 15, 1996, MMI commenced an action in the Superior Court in the
Judicial District of Waterbury, Connecticut (the "Superior Court") to require
the Company to permit MMI to examine and make copies of the Company's
stockholder list for the purpose of permitting MMI to communicate with other
stockholders of the Company.
On August 22, 1996, MMI, Mr. Ohnell (on his own behalf and on behalf of the
Ohnell Family Foundation and his wife and two children (collectively, the
"Ohnell Investors")) and two other stockholders issued a written request for a
special meeting of stockholders to the president of the Company. On September 6,
1996, the Company rejected the request for a special meeting of stockholders and
filed an action requesting a temporary and permanent injunction and declaratory
relief against MMI calling for a special meeting of stockholders. At a hearing
on September 9, 1996, the Superior Court consolidated MMI's action filed August
15, 1996 requesting the stockholder list and the Company's action filed
September 6, 1996 requesting an injunction against having to call a special
meeting of stockholders.
On September 25, 1996, MMI, the Ohnell Investors and one other stockholder
issued a second written request to the President of the Company requesting that
he call a special meeting of stockholders in order to (i) consider the Merger
Proposal, (ii) consider a proposal requesting that the Company's Board of
Directors approve the Merger Proposal, and if no merger of the Company is
consummated by December 31, 1996, the declaration of a special dividend of $3.00
per share, (iii) consider amending the bylaws of the Company to repeal the
amendment thereof adopted by the Company's Board of Directors on July 29, 1996
which increased the required stockholder vote to amend the bylaws from 50% to
75%, (iv) consider amending the bylaws to permit the removal of directors by
majority vote of stockholders, and (v) consider a proposal to replace the
current directors with a new slate of directors committed to maximizing the
current stockholder values pursuant to clauses (i) and (ii) above. A copy of the
request dated September 25, 1996 is annexed hereto as Exhibit 11.
MMI's request for a stockholders list and the request for a special meeting
of stockholders were the subject of the litigation before the Superior Court. A
trial was held October 2 through October 4, 1996. In December, the Superior
Court ruled that the Company was required to provide MMI with a stockholders
list and MMI was enjoined from calling a special meeting pursuant to the request
dated September 25, 1996.
On September 20, 1996, Millbrook sent a letter to the Company's
stockholders updating them with respect to the status of the Merger Proposal. A
copy of the letter is annexed hereto as Exhibit 12.
On November 20, 1996, Mr. Ohnell sent to the Secretary of the Company
notice that he intends to present at the Company's 1997 annual meeting of
stockholders a stockholder proposal requesting the Company's Board of Directors
to authorize the immediate retention of an investment banking firm to seek
proposals for the sale of the Company to maximize stockholder value. A copy of
such notice is annexed as Exhibit 13 hereto.
On January 22, 1997, the Company finally sent MMI a copy of its
shareholders list, which failed to include a list of non-objecting beneficial
owners.
On February 5, 1997, MMI notified the Company of its intent to nominate
three individuals to fill the three vacancies on the Company's board of
directors that will arise due to their term expirations as of
Page 9 of 27 Pages
<PAGE>
the next annual meeting of the Company's shareholders. A copy of such notice is
annexed as Exhibit 14 hereto. On February 6, 1997, Millbrook issued a press
release regarding its notification to the Company. A copy of such press release
is annexed as Exhibit 15 hereto.
Item 5. Interest in Securities of the Issuer
Item 5 of Schedule 13D is hereby amended in its entirety to read as
follows:
(a) As of February 5, 1997, MMI directly and beneficially owns (as defined
by Rule 13d-3 under the Act) 178,400 Shares, or 6.61% of the 2,699,284 Shares
outstanding as of September 28, 1996 as reported by the Company in its Quarterly
Report on Form 10-Q for the quarter ended September 28, 1996.
As Manager of MMI, Millbrook has sole power to vote and dispose of
investments held by MMI; therefore, it beneficially owns (as defined by Rule
13d-3 of the Act) the Shares owned by MMI. Mr. Dyson, Chairman, a Director and
sole stockholder of Millbrook, has the power to direct Millbrook to vote or
dispose of the Shares held by MMI; therefore, he beneficially owns (as defined
by Rule 13d-3 of the Act) the Shares owned by MMI.
Mr. Ohnell beneficially owns 89,800 Shares, or 3.33% of the Shares
outstanding, including 52,050 Shares held directly by Mr. Ohnell, 9,300 Shares
held by the Ohnell Family Foundation of which Mr. Ohnell is trustee, and 25,450
Shares held by his emancipated adult children and 3,000 Shares held by his wife
with respect to which Mr. Ohnell holds an irrevocable proxy.
(b) As sole owner of the Shares that it holds, MMI has sole voting and
dispositive power over the 178,400 Shares that it owns directly. As Manager of
MMI, Millbrook has the sole power to direct the voting or disposition of the
Shares held by MMI; thus, Millbrook has sole voting and dispositive power over
such Shares. As Chairman, a Director and sole stockholder of Millbrook, Mr.
Dyson has the sole power to direct Millbrook on the voting or disposition of
Shares held by MMI; thus, Mr. Dyson also has sole voting and dispositive power
over such Shares.
Mr. Ohnell has sole voting and dispositive power over the 89,800 Shares
that he beneficially owns.
(c) The Millbrook Reporting Persons became beneficial owners for purposes
of Rule 13d-3 of more than five percent of the Shares on April 29, 1996. See
Exhibit 1 for a list of purchase transactions with respect to Shares executed by
MMI prior to the date of this report. All such purchases were made on the open
market through the facilities of the American Stock Exchange.
Mr. Ohnell became a Reporting Person on July 16, 1996 upon execution of the
letter agreement contained in Exhibit 6 between Mr. Ohnell and Millbrook
relating to the Proposed Merger. Mr. Ohnell has not acquired beneficial
ownership of any Shares during the 60 day period prior to the date hereof.
(d) No other person has the right to receive or the power to direct the
receipt of dividends from, or proceeds from the sale of, any of the Shares held
by MMI and the 52,050 Shares directly owned by
Page 10 of 27 Pages
<PAGE>
Mr. Ohnell. The Ohnell Family Foundation and members of Mr. Ohnell's family have
the right to receive dividends or the proceeds from the sale of Shares held by
them.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer
Item 6 of Schedule 13D is hereby amended in its entirety to read as
follows:
On July 16, 1996, Millbrook and Mr. Ohnell executed a letter agreement in
which they agreed to cooperate in making the Merger Proposal. Such letter
agreement is Exhibit 5 hereto.
In addition, on July 16, 1996, Millbrook sent a letter to the Chairman of
the Company setting forth the Merger Proposal. Such letter is Exhibit 3 hereto.
Additional correspondence from Millbrook to the Company with respect to the
Merger Proposal is contained in Exhibits 9 and 10 hereto. The request for a
special meeting of stockholders dated September 25, 1996 is contained in Exhibit
11 hereto.
On July 16, 1996, each of Mr. Ohnell's wife and children executed
irrevocable proxies to Mr. Ohnell with respect to Shares held by them. Such
proxies are Exhibits 6, 7 and 8 hereto.
Except as otherwise set forth above or in Item 3, none of the Reporting
Persons, and to the knowledge of the Reporting Persons, none of the Millbrook
Principals, has any contract, arrangement, understanding or relationship (legal
or otherwise) with respect to any securities of the Company, including but not
limited to, transfer or voting of any of the securities, finder's fees, joint
ventures, loan or option arrangements, put or calls, guarantees of profits,
division of profits or loss, or the giving or withholding of proxies.
Item 7. Material to Be Filed as Exhibits
Exhibit 1 Schedule of Transactions.
Exhibit 2 Amended Joint Filing Agreement dated July 16, 1996.
Exhibit 3 Letter to Chairman of the Company dated July 16, 1996.
Exhibit 4 Press Release dated July 17, 1996.
Exhibit 5 Letter Agreement by and between Millbrook and Mr. Ohnell dated July
16, 1996.
Exhibit 6 Irrevocable Proxy dated July 16, 1996 of Patricia Ohnell.
Exhibit 7 Irrevocable Proxy dated July 16, 1996 of Carin M. Ohnell.
Page 11 of 27 Pages
<PAGE>
Exhibit 8 Irrevocable Proxy dated July 16, 1996 of Eileen H. Ohnell.
Exhibit 9 Letter to Chairman of the Company dated July 18, 1996.
Exhibit 10 Letter to Chairman of the Company dated July 24, 1996.
Exhibit 11 Request for special meeting of stockholders of the Company dated
September 25, 1996.
Exhibit 12 Letter from Millbrook to Company's stockholders dated September 20,
1996.
Exhibit 13 Notice dated November 20, 1996 from Mr. Ohnell to the
Company presenting a proposal to be considered at the 1997
annual meeting of stockholders.
Exhibit 14 Shareholder's Notice of Nominations dated February 5, 1997
from MMI to the Company, addressed to Mr. Whitmore, the
Secretary of the Company.
Exhibit 15 Press Release dated February 6, 1997.
Page 12 of 27 Pages
<PAGE>
SIGNATURE
After reasonable inquiry and to the best knowledge and belief of the
undersigned, each of the undersigned certifies that the information set forth in
this statement is true, complete and correct.
MMI INVESTMENTS, L.L.C.
By: /s/ Clay B. Lifflander
--------------------------
Clay B. Lifflander
as President of Millbrook
Capital Management Inc.,
Manager of MMI Investments,
L.L.C.
MILLBROOK CAPITAL MANAGEMENT
INC.
By: /s/ Clay B. Lifflander
--------------------------
Clay B. Lifflander
President
B.W. ELLIOTT MANUFACTURING CO.
By: /s/ George M. Scherer
--------------------------
George M. Scherer
President
/s/ John S. Dyson
--------------------------
John S. Dyson
Individually
/s/ Ernst Ohnell
--------------------------
Ernst Ohnell
Individually
Dated: February 13, 1997
Page 13 of 27 Pages
<PAGE>
EXHIBIT INDEX
Exhibit 1 Schedule of Transactions. ***
Exhibit 2 Amended Joint Filing Agreement dated July 16, 1996. *
Exhibit 3 Letter to Chairman of the Company dated July 16, 1996. *
Exhibit 4 Press Release dated July 17, 1996. *
Exhibit 5 Letter Agreement by and between Millbrook and Mr. Ohnell dated
July 16, 1996. *
Exhibit 6 Irrevocable Proxy dated July 16, 1996 of Patricia Ohnell. *
Exhibit 7 Irrevocable Proxy dated July 16, 1996 of Carin M. Ohnell. *
Exhibit 8 Irrevocable Proxy dated July 16, 1996 of Eileen H. Ohnell. *
Exhibit 9 Letter to Chairman of the Company dated July 18, 1996. **
Exhibit 10 Letter to Chairman of the Company dated July 24, 1996. **
Exhibit 11 Request for special meeting of stockholders of the Company
dated September 25, 1996. ***
Exhibit 12 Letter from Millbrook to Company's stockholders dated
September 20, 1996. ***
Exhibit 13 Notice dated November 20, 1996 from Mr. Ohnell to the Company
presenting a proposal to be considered at the 1997 annual
meeting of stockholders. ****
Exhibit 14 Shareholder's Notice of Nominations dated February 5, 1997
page 16 from MMI to the Company, addressed to Mr. Whitmore, the
Secretary of the Company.
Exhibit 15 Press Release dated February 6, 1997. page 27
- ------------------------------------
* Filed as an exhibit with Amendment No. 1 to Schedule 13D dated July 16,
1996.
** Filed as an exhibit with Amendment No. 2 to Schedule 13D dated July 24,
1996.
*** Filed as an exhibit with Amendment No. 3 to Schedule 13D dated September
25, 1996.
Page 14 of 27 Pages
<PAGE>
**** Filed as an exhibit with Amendment No. 4 to Schedule 13D dated November 20,
1996.
Page 15 of 27 Pages
Exhibit 14
February 5, 1997
VIA FACSIMILE AND
OVERNIGHT DELIVERY SERVICE
Mr. Donald E. Whitmore, Jr.
Secretary
The Eastern Company
112 Bridge Street
Naugatuck, CT 06770
Dear Mr. Whitmore:
SHAREHOLDER'S NOTICE OF NOMINATIONS
Pursuant to Article III, Section 7 of the By-Laws of The Eastern Company,
MMI Investments, L.L.C., a shareholder of The Eastern Company, hereby gives
notice that it proposes to nominate the following three persons for election as
Directors at the Annual Meeting of Shareholders to be held in 1997:
1. John S. Dyson
Age: 53
Business Address: RR 1, Box 167D, Wing Road, Millbrook,
New York 12545
Residence Address: Maple Tor Farm, RR 1, Box 166A, Wing Road,
Millbrook, New York 12545
Principal Occupation or Employment: Chairman and a director of
Millbrook Capital Management Inc.
Number of Shares of Common Stock of The Eastern Company beneficially
owned as of the date of this notice: 178,400 Other information about
nominee: See attached Exhibit A.
Page 16 of 27 Pages
<PAGE>
2. Clay B. Lifflander
Age: 34
Business Address: RR I, Box 167D, Wing Road, Millbrook,
New York 12545
Residence Address: 52 Meeting House Road, Pawling, New York 12564
Principal Occupation or Employment: President and a director of
Millbrook Capital Management Inc.
Number of Shares of Common Stock of The Eastern Company beneficially
owned as of the date of this notice: None.1
Other information about nominee: See attached Exhibit B.
3. George M. Scherer
Age: 42
Business Address: 37 Milford Street, Binghamton, New York 13902
Residence Address: 9 Pamela Drive, Binghamton, New York 13901
Principal Occupation or Employment: President and a director of
B. W. Elliott Manufacturing Company Inc.
Number of shares of Common Stock of The Eastern Company beneficially
owned as of the date of this notice: None.
Other information about nominee: See attached Exhibit C.
Also attached are the originally-executed consents of each of the three
nominees to being named in a proxy statement as a nominee for Director and to
serving as a Director of The Eastern Company, if elected.
- --------
1 However, Mr. Lifflander serves as President and a director of Millbrook
Capital Management Inc., the Manager of MMI Investments, L.L.C., which is
the beneficial and record owner of shares of common stock of The Eastern
Company. Mr. Lifflander is also a member of MMI Investments, L.L.C. On July
16, 1996, Mr. Lifflander revoked the proxy given to him by Mr. Dyson to
vote the shares of capital stock of Millbrook Capital Management Inc. that
Mr. Dyson owns.
Page 17 of 27 Pages
<PAGE>
The name and address of the shareholder submitting this notice, as it
appears on the books of The Eastern Company, is MMI Investments, L.L.C., RR 1,
Box 167D, Wing Road, Millbrook, New York, 12545.
MMI Investments, L.L.C. owns beneficially and of record 1,000 shares of
common stock of The Eastern Company and it owns beneficially an additional
177,400 shares of common stock of The Eastern Company. All of these shares have
been purchased by MMI Investments, L.L.C. within the last two years. See Exhibit
D for the dates and number of shares purchased by MMI Investments, L.L.C. during
such period.
MMI Investments, L.L.C. has retained D. F. King & Co., Inc. ("D.F. King")
for solicitation and advisory services in connection with the solicitation of
proxies at an estimated fee of $30,000, together with reimbursement for its
reasonable out-of-pocket expenses. MMI Investments, L.L.C. has also agreed to
indemnify D.F. King against certain liabilities and expenses, including
liabilities and expenses under the federal securities laws. D.F. King will
solicit by mail, telephone and in person, proxies for the Annual Meeting from
individuals, brokers, banks, bank nominees and other institutional holders. It
is anticipated the D.F. King will employ approximately fifty (50) persons to
solicit stockholders for the Annual Meeting. The address of D. F. King is 77
Water Street, New York, New York, 10005.
MMI Investments, L.L.C. or Millbrook Capital Management Inc., the manager
of MMI Investments, L.L.C., will pay all costs associated with the solicitation
of proxies on behalf of MMI Investments, L.L.C.
The participants in the solicitation with respect to the slate of directors
nominated hereby, who are collectively referred to as the "Participants", are
the following:
1. John S. Dyson
Age: 53
Business Address: RR 1, Box 167D, Wing Road, Millbrook,
New York 12545
Residence Address: Maple Tor Farm, RR 1, Box 166A, Wing Road,
Millbrook, New York 12545
Principal Occupation or Employment: Chairman and a director of
Millbrook Capital Management Inc.
Number of Shares of Common Stock of The Eastern Company beneficially
owned as of the date of this notice: 178,400
Other information about nominee: See attached Exhibit A.
Page 18 of 27 Pages
<PAGE>
2. Clay B. Lifflander
Age: 34
Business Address: RR I, Box 167D, Wing Road, Millbrook,
New York 12545
Residence Address: 52 Meeting House Road, Pawling, New York 12564
Principal Occupation or Employment: President and a director of
Millbrook Capital Management Inc.
Number of Shares of Common Stock of The Eastern Company beneficially
owned as of the date of this notice: None.2
Other information about nominee: See attached Exhibit B.
3. George M. Scherer
Age: 42
Business Address: 37 Milford Street, Binghamton, New York 13902
Residence Address: 9 Pamela Drive, Binghamton, New York 13901
Principal Occupation or Employment: President and a director of
B. W. Elliott Manufacturing Company Inc.
Number of shares of Common Stock of The Eastern Company beneficially
owned as of the date of this notice: None.
Other information about nominee: See attached Exhibit C.
- --------
2 However, Mr. Lifflander serves as President and a director of Millbrook
Capital Management Inc., the Manager of MMI Investments, L.L.C., which is
the beneficial and record owner of shares of common stock of The Eastern
Company. Mr. Lifflander is also a member of MMI Investments, L.L.C. On July
16, 1996, Mr. Lifflander revoked the proxy given to him by Mr. Dyson to
vote the shares of capital stock of Millbrook Capital Management Inc. that
Mr. Dyson owns.
Page 19 of 27 Pages
<PAGE>
4. MMI Investments, L.L.C., a Delaware limited liability company
Business Address: RR 1, Box 167D, Wing Road, Millbrook, New York 12545
Principal Business: Investing in securities
Number of Shares of Common Stock of The Eastern Company beneficially
owned as of the date of this notice: 178,400.
Associates: Millbrook Capital Management Inc. is the Manager of MMI
Investments, L.L.C., and it beneficially owns the 178,400 shares of
common stock of The Eastern Company owned by MMI Investments, L.L.C.
5. Millbrook Capital Management Inc., a New York corporation
Business Address: RR 1, Box 167D, Wing Road, Millbrook, New York 12545
Principal Business: Managing investments in publicly traded securities
and in private companies
Number of Shares of Common Stock of The Eastern Company beneficially
owned as of the date of this notice: 178,400
Names and Addresses of, and Number of Shares of Common Stock of The
Eastern Company beneficially owned as of the date of this notice by,
Associates:
John Dyson - Chairman, sole stockholder and a director of
Millbrook Capital Management Inc., RR1, Box 167D, Wing Road,
Millbrook, New York 12545. Mr. Dyson beneficially owns the 178,400
shares of common stock of The Eastern Company owned by MMI
Investments, L.L.C.
Clay Lifflander - President and a director of Millbrook Capital
Management Inc., RR 1, Box 167D, Wing Road, Millbrook, New York,
12545. Mr. Lifflander beneficially owns no shares of The Eastern
Company.(3)
- --------
3 However, Mr. Lifflander serves as President and a director of Millbrook
Capital Management Inc., the Manager of MMI Investments, L.L.C., which is
the beneficial and record owner of shares of common stock of The Eastern
Company. Mr. Lifflander is also a member of MMI Investments, L.L.C. On July
16, 1996, Mr. Lifflander revoked the proxy given to him by Mr. Dyson to
vote the shares of capital stock of Millbrook Capital Management Inc. that
Mr. Dyson owns.
Page 20 of 27 Pages
<PAGE>
Alan Rivera - Chief Financial Officer and a director of Millbrook
Capital Management Inc., RR 1, Box 167D, Wing Road, Millbrook, New
York, 12545. Mr. Rivera beneficially owns no shares of The Eastern
Company.
David Bova - Vice President and a director of Millbrook Capital
Management Inc., RR 1, Box 167D, Wing Road, Millbrook, New York,
12545. Mr. Bova beneficially owns no shares of The Eastern Company.
6. Ernst Ohnell
Business Address: 2 Greenwich Plaza, Suite 100, Greenwich,
Connecticut, 06830
Residence Address: 75 Khakum Wood Road, Greenwich, Connecticut, 06831
Principal Occupation: Chief Executive Officer of Ohnell Capital
Corporation, which is in the business of merchant banking.
Number of Shares of Common Stock of The Eastern Company beneficially
owned as of the date of this notice: 89,800, which includes 52,050
shares held directly by Mr. Ohnell, as well as 9,300 shares owned by
the Ohnell Family Foundation of which Mr. Ohnell is trustee and 25,450
shares and 3,000 shares owned by his emancipated adult children and his
wife, respectively, with respect to which Mr. Ohnell holds an
irrevocable proxy.
Messrs. Dyson, Lifflander and Ohnell, individually, and MMI Investments,
L.L.C., Millbrook Capital Management Inc. and B. W. Elliott Manufacturing
Company have executed agreements with respect to the joint filing of Schedules
13D and amendments thereto which have been filed with the Securities and
Exchange Commission with respect to the investment of certain Participants in
common stock of The Eastern Company. In addition, on July 16, 1996, Millbrook
Capital Management Inc. and Mr. Ohnell executed a letter agreement in which they
agreed to cooperate with respect to a proposed offer by MMI Investments, L.L.C.
to acquire The Eastern Company, they agreed to indemnify each other for certain
liabilities arising from certain actions or statements made in connection with
the proposed offer, Mr. Ohnell agreed not to acquire, sell or grant a proxy with
respect to shares of common stock in The Eastern Company without notifying
Millbrook Capital Management Inc., Mr. Ohnell agreed to vote the shares of
common stock of The Eastern Company that he controls for a proposed merger by
Millbrook Capital Management Inc., Millbrook Capital Management Inc. agreed to
permit Mr. Ohnell to participate in the proposed acquisition of The Eastern
Company and Mr. Ohnell is permitted to agree to be a director of the entity that
was to acquire The Eastern Company.
Other than as stated above, there are no further understandings between the
Participants or any associates of the Participants regarding future employment
or transactions with The Eastern Company and its affiliates.
Page 21 of 27 Pages
<PAGE>
Please advise the undersigned of any objections that you have regarding
this notice or the nomination for the 1997 Annual Meeting of Shareholders of the
slate of directors made hereby by February 14, 1997.
Very truly yours,
MMI INVESTMENTS, L.L.C.
By: Millbrook Capital Management Inc.,
Manager
By: /s/ Alan L. Rivera
---------------------------------
Alan L. Rivera
Chief Financial Officer
Attachments
Page 22 of 27 Pages
<PAGE>
EXHIBIT A
Mr. Dyson is Chairman of Millbrook Capital Management Inc., the Manager of MMI
Investments, L.L.C., and its predecessors since 1981. He is also a director of
Millbrook Capital Management Inc. From 1994 to 1996, Mr. Dyson served as Deputy
Mayor for Finance and Economic Development for the City of New York and
currently serves as Chairman of the Mayor's Council of Economic Advisors. Mr.
Dyson was Vice Chairman of Dyson-Kissner-Moran Corporation, a family owned
investment company, where he worked from 1970 to 1975 at which time he was
appointed to the position of Commissioner of the New York State Department of
Agriculture. From 1976 to 1979 he served as Commissioner of the New York State
Department of Commerce. From 1979 to 1985, Mr. Dyson was Chairman of the New
York State Power Authority. Mr. Dyson serves as a Trustee of Cornell University,
Morgan Library, Middlesex School and Historic Hudson Valley.
Page 23 of 27 Pages
<PAGE>
EXHIBIT B
From October 1995 to present, Mr. Lifflander has been President and a director
of Millbrook Capital Management Inc., the Manager of MMI Investments, L.L.C.
From March 1994 to September 1995, Mr. Lifflander was President of the New York
City Economic Development Corporation. Previously, Mr. Lifflander was a Managing
Director in the Mergers and Acquisitions Group at Smith Barney Inc., where he
worked from 1984 to 1994.
Page 24 of 27 Pages
<PAGE>
EXHIBIT C
From 1982 to present, Mr. Scherer has been President and a director of B. W.
Elliott Manufacturing Company, Inc., a corporation engaged primarily in the
business of designing and manufacturing flexible shaft products for the
industrial, aerospace and commercial markets, and in which Mr. Dyson indirectly
holds a major investment. From 1993 to present, Mr. Scherer has been a Director
of the Binghamton Mets Baseball Club.
Page 25 of 27 Pages
<PAGE>
EXHIBIT D
Schedule of Transactions
Purchases of Common Stock of The Eastern Company
by MMI Investments, L.L.C.
DATE SHARES PRICE PER SHARE
---- ------ ---------------
02/05/96 17,300 $12.25
02/09/96 7,000 12.50
02/12/96 700 12.50
02/14/96 14,200 12.19
02/20/96 4,400 12.00
02/27/96 400 12.00
02/29/96 3,000 12.00
03/04/96 2,000 11.88
03/05/96 10,500 12.00
03/05/96 1,000 11.88
03/07/96 2,000 12.00
03/07/96 3,600 12.13
03/11/96 200 12.00
03/13/96 44,600 12.25
03/22/96 800 11.95
03/25/96 600 12.00
03/26/96 300 12.00
03/27/96 600 12.00
03/28/96 700 12.00
03/29/96 1,000 12.00
04/02/96 1,100 11.88
04/04/96 9,900 12.00
04/09/96 4,100 11.88
04/10/96 1,900 11.75
04/29/96 10,400 11.50
04/30/96 500 11.63
05/01/96 500 11.88
05/02/96 6,100 11.88
05/03/96 6,000 12.39
05/06/96 7,500 12.48
07/08/96 500 11.75
07/16/96 1,000 11.75
07/18/96 10,000 13.88
08/15/96 2,000 13.31
08/18/96 1,000 12.75
09/10/96 1,000 13.38
In connection with the above-referenced transactions, MMI
Investments, L.L.C. used approximately $1.4 million of margin loans to finance
these purchases. These margin loans were with brokers under customary terms and
conditions.
Page 26 of 27 Pages
Exhibit 15
MILLBROOK CAPITAL MANAGEMENT
SUBMITS DIRECTOR NOMINATIONS
TO THE EASTERN COMPANY
Millbrook, NY -- February 6, 1997 -- Millbrook Capital Management Inc.
("MCM") announced today that its affiliate, MMI Investments L.L.C. has formally
submitted to The Eastern Company (AMEX:EML) a slate of three nominees for
election to the Board of Directors of Eastern at its 1997 Annual Meeting of
Shareholders. Eastern has established February 28th as the record date for the
meeting which is expected to be held in April. MCM has retained D.F. King & Co.,
Inc. to assist it with its efforts. MCM expects to file proxy material with
respect to the elections of the nominees with the Securities and Exchange
Commission in due course.
MCM, the beneficial owner of approximately 6.61% of Eastern's Common
Stock, intends to replace Eastern's incumbent nominees with three new directors
committed to enhancing value for all Eastern shareholders. The MCM slate
consists of MCM's Chairman, John S. Dyson, its President, Clay B. Lifflander,
and George M. Scherer, President of B.W. Elliott Manufacturing Company.
MCM, based in Millbrook, NY, is an investment firm owned by John S.
Dyson. MCM specializes in the acquisition and management of middle market
companies. Until recently, Mr. Dyson served as Deputy Mayor for Finance and
Economic Development of New York City. Ernst Ohnell, a participant in MCM's
solicitation with respect to the MCM slate, is the founder and CEO of Ohnell
Capital Corporation, which is in the merchant banking business.
For more information contact:
Investor Contact: Media Contact:
John Nesbett Andy Lavin
Lippert/Heilshorn & Associates A. Lavin Communications
212-838-3777 212-354-2266
Page 27 of 27 Pages
