UNITED STATES
	SECURITIES AND EXCHANGE COMMISSION
	Washington, D.C. 20549
	SCHEDULE 13D

 

Under the Securities Exchange Act of 1934
(Amendment No. 4)*

 

(Name of Issuer)

 

(Title of Class of Securities)

 

(CUSIP Number)

 

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

 

(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 Sections 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box o.

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 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 purposes 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).

 

 

 

(1)  Calculated based on the 9,641,731 aggregate number of common shares stated to be outstanding on August 1, 2013 by the Issuer in the Issuer’s Form 10-Q filed with the Securities and Exchange Commission on August 8, 2013.

 

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Introductory Statement

 

This Amendment No. 4 (this “Amendment”) amends the Schedule 13D initially filed by Catalina Holdings (Bermuda) Ltd (“Catalina”) on March 5, 2013 (the “Original Filing”), amended on July 29, 2013 (“Amendment No. 1”), August 6, 2013 (“Amendment No. 2”) and August 14, 2013 (“Amendment No. 3”), relating to shares of the Common Stock, $0.01 par value per share (the “Common Shares”), of American Safety Insurance Holdings, Ltd. (“ASI”).  Information reported in the Original Filing, Amendment No. 1, Amendment No. 2 and Amendment No. 3 remains in effect except to the extent that it is amended or superseded by information contained in this Amendment.

 

Item 4.

Purpose of Transaction

 

The disclosure in Item 4 of the Schedule 13D is hereby supplemented by adding the following:

 

On August 15, 2013, Catalina sent a further letter to the board of directors of ASI confirming Catalina’s offer price of $30.75 per fully diluted share.  A copy of the letter is attached hereto as Exhibit 99.4.

 

Item 7.

Material to be Filed as Exhibits

 

Item 7 of the Schedule 13D is hereby supplemented by adding the following:

 

Exhibit 99.4  Letter dated August 15, 2013 from Catalina to the board of directors of ASI.

 

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SIGNATURES

 

After reasonable 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: August 16, 2013

 

 

	Catalina Holdings (Bermuda) Ltd
	By:	/s/ Campbell McBeath
		Name: Campbell McBeath
		Title: Group Treasurer

 

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INDEX TO EXHIBITS

 

Exhibit 99.4          Letter dated August 15, 2013 from Catalina to the board of directors of ASI.

 

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Exhibit 99.4

 

	Cumberland House
	1 Victoria Street, 7th Floor,
	Hamilton HM11, Bermuda
CATALINA HOLDINGS
(BERMUDA) LTD	Tel +1 441 494 6350
	Fax +1 441 494 6390

 

August 15, 2013

 

The Board of Directors

American Safety Insurance Holdings, Ltd.

31 Queen Street, 2nd Floor
Hamilton, Bermuda

 

Attn:                    Stephen R. Crim

 

BY EMAIL

 

Dear Stephen:

 

We are writing in regard to our letter dated August 14, 2013, in which we expressed the continued interest of Catalina Holdings (Bermuda) Ltd (“Catalina” or “us”) in the acquisition of American Safety Insurance Holdings, Ltd. (“ASI”). This transaction is of significant interest to Catalina and we are prepared to commit the resources at our disposal to acquire ASI.

 

We hereby confirm our good faith proposal to acquire 100% of the capital stock of ASI that we do not already own, for $30.75 per fully diluted share and on the same terms as outlined in our July 29 Letter and reflected in our revised Merger Agreement submitted today.

 

We hereby also confirm that funding for the purchase price will be met from equity at hand on Catalina’s balance sheet and senior bank debt financing provided by Royal Bank of Canada and Lloyds TSB Bank plc.  RBC Capital Markets, LLC is acting as our exclusive financial advisor.  Our bank financing is committed and immediately drawable.

 

We continue to believe our good faith proposal is superior (as defined in the merger agreement with Fairfax Financial Holdings Limited (“Fairfax”)) and highlight the following:

 

·                  Catalina proposes to acquire ASI at a higher per share price than Fairfax.

 

·                  Catalina has a history of receiving change of control approval from Bermudian and U.S. insurance regulators without unnecessary delay in all previous transactions.  Catalina has never had an application for change of control declined. We do not believe ASI or its advisors have any reason or basis to assert anything to the contrary. Catalina is a serial acquirer of insurance and reinsurance companies and has significant experience in obtaining regulatory change of control in multiple jurisdictions around the world. It is a fundamental part of Catalina’s business and we (and probably your shareholders as well) would find it very surprising if the ASI board put this forward as a weakness in our bid.

 

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·                  Our revised Merger Agreement contains terms substantially similar to the Merger Agreement entered into with Fairfax.

 

·                  We are unable to accommodate your request for immediate reimbursement of the termination fee the Board agreed with Fairfax, in particular given the Board’s decision last week to increase the termination fee to $13.4 million.  As previously noted, such a reimbursement is completely unreasonable.  However, we are agreeing to the sizeable increase in the reverse termination fee you requested.  While the request is highly unusual in a case such as this in which no party has realistically raised the prospect of the failure of any regulatory approval, our agreement to include a reverse termination fee of that size reflects our commitment to the transaction and our confidence in reaching closing.  Furthermore, it more than addresses monetarily the concerns reflected in your request for reimbursement of the Fairfax termination fee.

 

·                  Lastly, in the spirit of ensuring maximum value to ASI shareholders, we have maintained the same termination fee as in the original Fairfax agreement despite our higher offer price and potential for a competing proposal.

 

We expect that the Board will determine that our good faith proposal is superior.  Thus, we would expect the Board to change its recommendation for the transaction and allow for the termination of the voting agreements with ASI management and the entering into similar voting agreements related to our proposal.

 

Please advise us at what time the Board will be meeting to consider our good faith proposal.  We want to assure you that we are available at any time, whether before or during the meeting of the Board, to discuss any concerns you may have regarding our proposal.  Without any guidance from the Board, it is not possible to respond to your request for our “best and final” offer as we cannot assess the status of a competing offer.

 

We look forward to hearing from you regarding the status of our good faith proposal.

 

Yours sincerely,

 

 

/s/ pp Keith Lyon
Chris Fagan
Chief Executive
Catalina Holdings (Bermuda) Ltd

 

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