Further adding to the need for clarity, I am not alone in my concern over how a merger with Westport will impact my future investment as an FSS stockholder. In light of Westport's disappointing earnings results and the concerns I raised to you last week, Lloyd I. Miller III, the beneficial owner of more than 725,000 shares of common stock of FSS, representing approximately 4% of the outstanding shares, changed his voting intention to undecided. His letter echoed my concerns over how significantly Westport and this transaction have changed since this deal was first announced on September 1, 2015.It is clear to me that your investors are demanding a response. However, in the week since I sent my letter the board has failed to formally communicate with me in any way. This silence is troubling to me as a holder of a significant stake in this company and someone who spent years directly contributing to the organization's success. I will restate again that my concern over the future of FSS within Westport centers around the $71 million investment in Westport by Cartesian Capital Group ("Cartesian") announced on January 11, 2016. My view is that the Cartesian investment agreement is not only a significant burden of debt to incur, but also that the rights gained by Cartesian alter the future of Westport in a way that could negatively impact FSS investors. Specifically, the $71 million investment gives Cartesian:
- a direct position in the financial success of HPDI, arguably the biggest piece of Westport's future growth;
- convertible notes that could eventually dilute stockholders;
- ownership of certain Westport assets to be completed by May 30, 2016;
- a stake in future joint ventures to develop products;
- a position on the board; and
- specific rights over Westport's business including, consent rights with respect to material acquisitions or material dispositions of any of its subsidiaries. How these rights were altered is not adequately addressed in the announcement of the amended merger agreement.
Based simply on this financial profile, the burdensome Cartesian agreement and my general outlook for Westport, I am of the belief that my investment is better suited in a standalone FSS at this time. For that reason, I intend to vote AGAINST the proposal to adopt the merger agreement and approve the merger at the special meeting.Thank you. Sincerely, /s/ Pier Antonio CostamagnaPier Antonio Costamagna