_ UNITED STATES
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
May 8, 2002
Date of Report (Date of Earliest Event Reported)
Commission File Number: 000-29727
PARTSBASE, INC.
(Exact Name Of Registrant As Specified In Its Charter)
Delaware 76-0604158
_______________________________ ___________________
(State or Other Jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
905 Clint Moore Road
Boca Raton, Florida 33487-8233
(Address of Principal Executive Offices)
(561) 953-0700
(Registrant's Telephone Number, Including Area Code)
N/A
(Former Name or Former Address, if Changed Since Last Report)
ITEM 5. OTHER EVENTS.
On May 8, 2002, the Company reported that it has reached an agreement in
principle for the settlement of the consolidated class action litigation pending
in the United States District Court Southern District of Florida styled In Re:
Partsbase.com Securities Litigation, Case No. 01-8319-CIV-Ungaro-Benages/Brown.
The plaintiffs in the case and the defendants, including PartsBase, through
their respective attorneys, entered into a Memorandum of Understanding outlining
the general terms of the proposed settlement. The Memorandum of Understanding
provides for, among other things, a settlement amount of $1.5 million in cash,
plus interest, payable to the class under an insurance policy and for the
plaintiffs' dismissal of the class action with prejudice as well as a broad form
of release in favor of PartsBase and the other defendants in the class action
which, among other things, will have the effect of barring all claims by the
plaintiffs and the members of the class other than those who opt out, arising
out of the purchase and sale of the Company's common stock in the Company's
initial public offering of securities.
The final settlement of the class action is subject to the preparation and
execution of definitive settlement documents and court approval. PartsBase has
been vigorously defending the action, and has admitted no wrongdoing as part of
the settlement. The settlement also applies to the directors, management
personnel, underwriters and securities firms named as defendants in the
litigation.
On April 10, 2002, the Company reported that it had received a proposal from
Robert Hammond, the Company's Chairman of the Board, President, CEO and
majority stockholder and a limited partnership controlled by Mr. Hammond to
acquire the remaining shares of the Company's common stock, approximately
5,000,000 shares or approximately 36 % of the shares currently outstanding,
Mr. Hammond does not own or control at a price of $1.02 per share (the
"Proposed Transaction"). On May 9, 2002, the Company received notice of, or had
been served with another purported class action lawsuit filed in the Circuit
Court in and for Palm Beach County, Florida ( Hughes Rousseau vs. PartsBase,
Inc. et.al, Case No. 02-05368. The lawsuit names as defendants the Company
and certain of its current officers and directors. The lawsuit alleges the
directors have breached their fiduciary duty to the plaintiffs and the purported
class and seeks to enjoin the Company from entering into the Proposed
Transaction, and to recover unspecified damages resulting from the alleged
breach of fiduciary duty. The Company intends to vigorously defend this as
well as the other similar actions filed. Nevertheless, an unfavorable
resolution of this or a substantially similar e lawsuits could have a material
adverse effect on the Company in one or more future periods. The Company
maintains a director's and officer's liability insurance policy that provides
$3 million of coverage, with retention of $150,000.
The Company does not intend to file further Current Reports on Form 8-K or other
disclosures describing additional lawsuits, if any, purporting class action
status, in either federal or state court, which are based on allegations
substantially similar to those contained in the consolidated lawsuit described
above.
A copy of the Company's press releases pertaining to the Agreement in Principle
for the settlement of the consolidated class action litigation pending in the
United States District Court Southern District of Florida is included herein as
Exhibit 99.1 and is incorporated herein by reference and the foregoing
descriptions of such document is qualified in its entirety by reference to such
exhibit. The press release should be read in conjunction with the Note Regarding
Forward Looking Statements, which is included in the text of such press release.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits.
Exhibit Description
______ ________________________________________________________________
99.1 Press Release Issued by the Company on May 8, 2002
regarding agreement in principle for the settlement of the
consolidated class action litigation pending in the United
States District Court Southern District of Florida styled
In Re: Partsbase.com Securities Litigation,
Case No. 01-8319-CIV-Ungaro-Benages/Brown.
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
PARTSBASE, INC.
/s/ Robert A. Hammond, Jr.
_________________________________
Robert A. Hammond, Jr., President
Date: May 10, 2002
4
EXHIBIT INDEX
Exhibit Description
_______ _______________________________________________________________________
99.1 Press Release Issued by the Company on May 8, 2002 regarding
agreement in principle for the settlement of the consolidated class
action litigation pending in the United States District Court Southern
District of Florida styled In Re: Partsbase.com Securities Litigation,
Case No. 01-8319-CIV-Ungaro-Benages/Brown.
5
EXHIBIT 99.1
Company Press Release
PARTSBASE ANNOUNCES AGREEMENT IN PRINCIPLE FOR THE SETTLEMENT OF CLASS ACTION
LAWSUIT
BOCA RATON, FLORIDA--(BUSINESS WIRE)-May 8, 2002-- PartsBase, Inc. (Nasdaq NMS:
PRTS - news) today announced that it has reached an agreement in principle for
the settlement of the consolidated class action litigation pending in the United
States District Court Southern District of Florida styled In Re: Partsbase.com
Securities Litigation, Case No. 01-8319-CIV-Ungaro-Benages/Brown. The plaintiffs
in the case and the defendants, including PartsBase, through their respective
attorneys, entered into a Memorandum of Understanding outlining the general
terms of the proposed settlement. The Memorandum of Understanding provides for,
among other things, a settlement amount of $1.5 million in cash, plus interest,
payable to the class under an insurance policy and for the plaintiffs' dismissal
of the class action with prejudice as well as a broad form of release in favor
of PartsBase and the other defendants in the class action which, among other
things, will have the effect of barring all claims by the plaintiffs and the
members of the class other than those who opt out, arising out of the purchase
and sale of the Company's common stock in the Company's initial public offering
of securities.
The final settlement of the class action is subject to the preparation and
execution of definitive settlement documents and court approval. PartsBase has
been vigorously defending the action, and has admitted no wrongdoing as part of
the settlement. The settlement also applies to the directors, management
personnel, underwriters and securities firms named as defendants in the
litigation.
ABOUT PARTSBASE, INC.
PartsBase, Inc. core business is as an online provider of Internet
business-to-business e-commerce services for the aviation industry. The
Company's global e-marketplace provides a means for over 10,000 members in more
than 125 countries to buy and sell new, used and overhauled aviation parts in an
efficient, competitive, and cost-effective manner.
RNpartners, Inc., a newly formed, wholly owned subsidiary, is a provider of
critical care registered nurses for temporary assignment to hospitals in Dade,
Hillsborough, Martin, Palm Beach and Broward counties of the State of Florida.
This announcement contains forward-looking statements that involve risks and
uncertainties, including those relating to competition from other service
providers, the Company's ability to grow its subscriber and hospital base, to
offer new functionality to that will be accepted by the aviation marketplace and
to attract a sufficient number of registered nurses in a limited talent pool.
Actual results may differ materially from the results predicted and reported
results should not be considered as an indication of future performance. The
potential risks and uncertainties include, among others, the increasingly
competitive and constantly changing nature of the business-to-business
e-commerce market. More information about potential factors that could affect
the Company's business and financial results is included in the Company's
Registration Statement on Form S-1 (SEC File No. 333-94337), as amended, and the
Company's reports filed pursuant to the Securities Exchange Act of 1934,
including, without limitation, under the captions, "Management's Discussion and
Analysis of Financial Condition and Results of Operations", "Risk Factors", and
"Competition", which are on file with the SEC (http://www.sec.gov).
Contact: For more information on PartsBase, Inc.:
Phone: 561.953.0702 Fax: 561.953.0786
Mark Weicher, Chief Financial Officer (mweicher@partsbase.com)