13D Filing: Peter Yu and Westport Fuel Systems Inc. (NASDAQ:WPRT)

The information set forth in Item 4 of this Schedule 13D is hereby incorporated by reference.

Item 4.   Purpose of Transaction.

The interests held by the Reporting Persons were acquired pursuant to the closing of the transactions on June 1, 2016 contemplated by that certain Investment Agreement (as amended, the “Investment Agreement”), dated as of January 11, 2016 by and among Westport Innovations Inc. and Pangaea Two Management, LP, XIV and Parallel XIV.  On June 1, 2016, the Issuer issued (i) to XIV a $12,076,225.00 aggregate principal amount Convertible Promissory Note (“Note 1“) and (ii) to Parallel XIV a $5,423,775.00 aggregate principal amount Convertible Promissory Note (“Note 2“). Each of Note 1 and Note 2 are convertible, as a whole or in part, at any time between June 1, 2017 and June 2, 2021 into the number Common Shares equal to dividing the then-outstanding amount under Note 1 or Note 2, as applicable, by $2.17, subject to customary anti-dilution adjustments.

Each of the Pangaea Entities acquired the interests in Note 1 and Note 2, as applicable, held by it for investment purposes.  The Pangaea Entities also intend to participate in and influence the affairs of the Issuer through exercise of their rights to appoint a director to the Issuer’s Board of Directors (pursuant to the Investment Agreement) and through their voting rights with respect to their Common Shares (which may be issued if Cartesian elects to convert either or both of Note 1 and Note 2).  Pursuant to the Investment Agreement, on June 1, 2016, Peter Yu, as a Cartesian designee, became a director of the Issuer.

The Reporting Persons intend to review their investment on a regular basis and, as a result thereof, may at any time or from time to time determine, either alone or as part of a group, (a) to acquire additional securities of the Issuer, through open market purchases, privately negotiated transactions or otherwise, (b) to dispose of all or a portion of the securities of the Issuer owned by it in the open market, in privately negotiated transactions or otherwise, (c) to enter into privately negotiated derivative transactions with institutional counterparties to hedge the market risk of some or all of its positions in the securities of the Issuer or (d) to take any other available course of action, which could involve one or more of the types of transactions or have one or more of the results described in clauses (a) through (j) of Item 4 of Schedule 13D. Any such acquisition or disposition or other transaction would be made in compliance with all applicable laws, regulations and trading policies. Notwithstanding anything contained herein, the Reporting Persons specifically reserve the right to change their intention with respect to any or all of such matters. In reaching any decision as to its course of action (as well as to the specific elements thereof), the Reporting Persons currently expect that it would take into consideration a variety of factors, including, but not limited to, the following: the Issuer’s business and prospects; other developments concerning the Issuer and its businesses generally; other business opportunities available to the Reporting Persons; changes in law and government regulations; general economic conditions; and money and stock market conditions, including the market price of the securities of the Issuer. Except as set forth herein (and after giving effect to the transaction), the Reporting Persons have no present plans or proposals that relate to or that would result in any of the actions specified in clauses (a) through (j) of Item 4 of Schedule 13D.

(a), (b) The following disclosure assumes there are 110,011,670 Common Shares outstanding according to the Form 6-K filed by the Issuer with the Securities and Exchange Commission on November 9, 2016.

The Reporting Persons, collectively, beneficially own in the aggregate 8,064,516.13 Common Shares (issuable in respect of the conversion of Note 1 and Note 2), comprised of 5,565,080.65 Common Shares (issuable in respect of the conversion of Note 1) held directly by XIV and 2,499,435.48 Common Shares held directly by Parallel XIV (issuable in respect of the conversion of Note 2).  Collectively, the Reporting Persons beneficially own 7.3306% of the total outstanding Common Shares.