Amendment No. 2 to Form S-3 for NN, Inc.
As filed with the Securities and Exchange Commission on February 6, 2003
Registration No. 333-100119
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Amendment No. 2
to
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
NN, Inc.
(Exact name of registrant as
specified in its charter)
Delaware 62-1096725
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification Number)
organization)
2000 Waters Edge Drive
Johnson City, Tennessee 37604
(423) 743-9151
(Address, including zip code, and telephone number,
including area code, of registrant's principal
executive offices)
Roderick R. Baty
President and Chief Executive Officer
2000 Waters Edge Drive
Johnson City, Tennessee 37604
(423) 743-9151
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
With Copies to:
James M. Ash
Blackwell Sanders Peper Martin LLP
2300 Main Street, Suite 1000
Kansas City, Missouri 64108
(816) 983-8000
Approximate date of commencement of proposed sale to the public: From time to
time after this Registration Statement becomes effective, as determined by
market conditions and other factors.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. | |
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
investment plans, check the following box. |X|
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of earlier effective
registration statement for the same offering. | |
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. | |
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. | |
CALCULATION OF REGISTRATION FEE
------------------------------------------------ ----------------- ------------------- ---------------------- -----------------
Proposed maximum Proposed maximum
Title of each class of securities to be Amount to be offering price Aggregate offering Amount of
registered registered per share price registration fee
------------------------------------------------ ----------------- ------------------- ---------------------- -----------------
Primary Offering: (1) (1) $ 36,000,000 (2) $ 3,312 (2)
Common Stock, par value $.01 per share
------------------------------------------------ ----------------- ------------------- ---------------------- -----------------
Secondary Offering: 3,733,664 shares $ 9.39 (3) $ 35,059,104 (3) $ 3,225
Common Stock, par value $.01 per share
------------------------------------------------ ----------------- ------------------- ---------------------- -----------------
TOTAL N/A N/A $ 73,876,903 $ 6,537(4)
------------------------------------------------ ----------------- ------------------- ---------------------- -----------------
(1) Not required in accordance with Rule 457(o).
(2) Determined in accordance with Rule 457(o).
(3) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457 based on the average of the high and low sales prices
on September 24, 2002 as reported by the Nasdaq National Market.
(4) The registrant previously paid $6,797. The amount of the registration fee
has been reduced due to the number of shares in the Secondary Offering being
reduced to 3,733,664.
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933, as amended, or until this Registration Statement
shall become effective on such date as the Commission, acting pursuant to said
Section 8(a), may determine.
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and is not soliciting an offer to buy these securities
in any state where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED FEBRUARY 6, 2003
Prospectus
[LOGO]
NN, INC.
COMMON STOCK
--------------------
$36,000,000 of Company Shares
3,733,664 of Selling Stockholders Shares
By this prospectus from time to time, we may offer and sell shares of
our common stock, par value $.01 per share, having an aggregate offering price
of up to $36,000,000.
Up to 3,733,664 shares of common stock may be sold from time to time in
one or more offerings by the selling stockholders identified on page 11. We will
not receive any proceeds from sales of shares of our common stock by the selling
stockholders.
We will provide you with a prospectus supplement before we or any of
the selling stockholders sell any common stock under this prospectus. Any
prospectus supplement will inform you about the specific terms of an offering by
us or any selling stockholder, will list the names of any underwriters or
agents, and may also add, update or change information contained in this
prospectus. You should read this prospectus, the documents that are incorporated
by reference in this prospectus and any prospectus supplement carefully before
investing. This prospectus may not be used to sell any common stock unless it is
accompanied by a prospectus supplement.
We may offer these securities directly to investors, or through agents,
underwriters or dealers. See "Plan of Distribution" on page 12. Each prospectus
supplement will provide the terms of the plan of distribution relating to each
offering of common stock.
Our common stock is quoted on the Nasdaq National Market under the
symbol "NNBR."
Investing in our common stock involves risks. See "Risk Factors"
beginning on page 4 to read about the risks you should consider before buying
our common stock.
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
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The date of this Prospectus is ____________, 2003
TABLE OF CONTENTS
ABOUT THIS PROSPECTUS........................................................1
RECENT DEVELOPMENTS..........................................................1
RISK FACTORS.................................................................3
NN, INC......................................................................8
USE OF PROCEEDS.............................................................10
SELLING STOCKHOLDERS........................................................11
PLAN OF DISTRIBUTION........................................................12
LEGAL MATTERS...............................................................16
EXPERTS.....................................................................16
WHERE YOU CAN FIND MORE INFORMATION.........................................16
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.............................16
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement on Form S-3 that we
filed with the Securities and Exchange Commission using a "shelf" registration
process. Under the shelf registration process, we may, from time to time, offer
and sell shares of our common stock described in this prospectus in one or more
offerings up to a total dollar amount of $36,000,000. In addition, up to
3,733,664 shares of our common stock may be sold from time to time in one or
more offerings by several of our stockholders. We will not receive any proceeds
from any sale of the shares by the selling stockholders.
This prospectus provides you with a general description of the
securities we may offer. Each time we or the selling stockholders sell common
stock, we will provide a prospectus supplement that will contain specific
information about the method and terms of that offering. The prospectus
supplement may also add, update or change information contained in this
prospectus. If there is any inconsistency between the information in this
prospectus and a prospectus supplement, you should rely on the information in
that prospectus supplement. You should read both this prospectus and any
applicable prospectus supplement together with additional information described
below under the heading "Where You Can Find More Information."
When acquiring any securities discussed in this prospectus, you should
rely upon the information contained in this prospectus and the prospectus
supplement, including the information incorporated by reference. We have not
authorized any other person to provide you with different information. If anyone
provides you with different or inconsistent information, you should not rely on
it. We are not making an offer to sell these securities in any jurisdiction
where the offer or sale is not permitted.
We and the selling stockholders may sell the common stock to or through
underwriters, dealers or agents or directly to purchasers. The applicable
prospectus supplement will provide the names of any underwriters, dealers or
agents involved in the sale of the common stock, and any applicable fee,
commission or discount arrangements with them. For a more detailed description
of the various means by which we may distribute the common stock, you should
read the information under the heading "Plan of Distribution."
As used in this prospectus and any prospectus supplement, the terms
"we," "us," "our," "NN" or the "Company," refer collectively to NN, Inc. and its
subsidiaries.
RECENT DEVELOPMENTS
On December 20, 2002, we acquired the 23 percent interest in NN
Euroball, ApS ("Euroball") held by INA/FAG. Euroball was formed in 2000 by the
Company, FAG Kugelfischer Georg Schaefler AG, which was subsequently acquired by
INA - Schaeffler KG (collectively, "INA/FAG") and AB SKF ("SKF"). INA/FAG is a
global bearing manufacturer and one of our largest customers. We paid
approximately 13.4 million Euros for INA/FAG's interest in Euroball. Following
the closing of the transaction, we own 77 percent of the outstanding shares of
Euroball and SKF owns the remaining 23 percent. SKF consented to our purchase of
INA/FAG's interest pursuant to the terms of the Euroball Shareholder Agreement.
1
SKF has the right, beginning January 1, 2003 to require us to purchase its
interest in Euroball, based on a formula price detailed in the Euroball
Shareholder Agreement.
On December 9, 2002, we announced that we had signed a letter of intent
to acquire certain component manufacturing operations of SKF in Veenendaal, The
Netherlands. SKF, a Swedish corporation, is a global bearing manufacturer and
one of our major customers. The transaction, which is expected to close in the
first quarter of 2003, is subject to a number of conditions, including the
execution of a definitive asset acquisition agreement, completion of due
diligence, approval of NN and SKF's boards of directors and any necessary
approval of relevant government agencies. The on-going negotations between the
parties have included the possibility of offering shares of our common stock
under this prospectus as all or part of the purchase price for the assets.
2
RISK FACTORS
You should carefully consider the following risks and uncertainties and
any risks and uncertainties contained in the accompanying prospectus supplement,
and all other information contained in or incorporated by reference in this
prospectus and the prospectus supplement, before making an investment in our
common stock. Any of the following risks could have a material adverse effect on
our business, financial condition or operating results. In such case, the
trading price of our common stock could decline and you may lose all or part of
your investment.
The demand for our products is cyclical, which could adversely impact
our revenues.
The end markets for fully assembled bearings are cyclical and tend to
decline in response to overall declines in industrial production. As a result,
the market for bearing components is also cyclical and impacted by overall
levels of industrial production. Our sales in the past have been negatively
affected, and in the future will be negatively affected, by adverse conditions
in the industrial production sector of the economy or by adverse global or
national economic conditions generally.
We depend on a very limited number of foreign sources for our primary
raw material and are subject to risks of shortages and price
fluctuation.
The steel that we use to manufacture precision balls and rollers is of
an extremely high quality and is available from a limited number of producers on
a global basis. Due to quality constraints in the U.S. steel industry, we obtain
substantially all of the steel used in our U.S. ball and roller production from
overseas suppliers. In addition, we obtain substantially all of the steel used
in our European ball production from a single European source. If we had to
obtain steel from sources other than our current suppliers, particularly in the
case of our European operations, we could face higher prices and transportation
costs, increased duties or taxes, and shortages of steel. Problems in obtaining
steel, and particularly 52100 chrome steel, in the quantities that we require
and on commercially reasonable terms, could increase our costs, negatively
impact our ability to operate our business efficiently and have a material
adverse effect on the operating and financial results of our Company.
We operate in and sell products to customers outside the U.S. and are
subject to several related risks.
Because we obtain a majority of our raw materials from overseas
suppliers, actively participate in overseas manufacturing operations and sell to
a large number of international customers, we face risks associated with the
following:
o adverse foreign currency fluctuations;
o changes in trade, monetary and fiscal policies, laws and
regulations, and other activities of governments, agencies and
similar organizations;
o the imposition of trade restrictions or prohibitions;
3
o high tax rates that discourage the repatriation of funds to the
U.S.;
o the imposition of import or other duties or taxes; and
o unstable governments or legal systems in countries in which our
suppliers, manufacturing operations, and customers are located.
We do not have a hedging program in place to help limit the risk associated with
consolidating the operating results of our foreign businesses into U.S. dollars.
An increase in the value of the U.S. dollar and/or the Euro relative to other
currencies may adversely affect our ability to compete with our foreign-based
competitors for international, as well as domestic, sales. Also, a decline in
the value of the Euro relative to the U.S. dollar will negatively impact our
consolidated financial results, which are denominated in U.S. dollars.
In addition, due to the typical slower summer manufacturing season in
Europe, we expect that revenues in the third fiscal quarter will reflect lower
sales, as our sales to foreign customers have increased as a percentage of net
sales.
We depend heavily on a relatively limited number of customers, and the
loss of any major customer would have a material adverse effect on our
business.
Sales to various U.S. and foreign divisions of SKF, which is one of
the largest bearing manufacturers in the world, accounted for approximately 35%
of consolidated net sales in 2001, and sales to INA/FAG accounted for
approximately 19% of consolidated net sales in 2001. During 2001, our ten
largest customers accounted for approximately 73% of our consolidated net sales.
None of our other customers individually accounted for more than 5% of our
consolidated net sales for 2001. The loss of all or a substantial portion of
sales to these customers would cause us to lose a substantial portion of our
revenue and would lower our profit margin and cash flows from operations.
The costs and difficulties of integrating acquired business could
impede our future growth.
We cannot assure you that any future acquisition will enhance our
financial performance. Our ability to effectively integrate any future
acquisitions will depend on, among other things, the adequacy of our
implementation plans, the ability of our management to oversee and operate
effectively the combined operations and our ability to achieve desired operating
efficiencies and sales goals. The integration of any acquired businesses might
cause us to incur unforeseen costs, which would lower our profit margin and
future earnings and would prevent us from realizing the expected benefits of
these acquisitions.
We may not be able to continue to make the acquisitions necessary for
us to realize our growth strategy.
Acquiring businesses that complement or expand our operations has been
and continues to be an important element of our business strategy. This strategy
calls for growth through acquisitions constituting approximately two-thirds of
our future growth, with the remainder resulting from internal growth and market
penetration. We bought our plastic bearing
4
component business in 1999, formed Euroball with our two largest bearing
customers, SKF and INA/FAG, in 2000 and acquired our bearing seal operations in
2001. We cannot assure you that we will be successful in identifying attractive
acquisition candidates or completing acquisitions on favorable terms in the
future. In addition, we may borrow funds to acquire other businesses, increasing
our interest expense and debt levels. Our inability to acquire businesses, or to
operate them profitably once acquired, could have a material adverse effect on
our business, financial position, results of operations and cash flows.
Additionally, SKF, the minority shareholder in Euroball, has the right
to require us to purchase its interest beginning in January 2003. The Company
may need to borrow funds to pay for all or a portion of the purchase of SKF's
interest or may be required to make a purchase at a time that is less favorable
to the Company.
Our growth strategy depends on outsourcing, and if the industry trend
toward outsourcing does not continue, our business could be adversely
affected.
Our growth strategy depends in significant part on major bearing
manufacturers continuing to outsource components, and expanding the number of
components being outsourced. This requires manufacturers to depart significantly
from their traditional methods of operations. If major bearing manufacturers do
not continue to expand outsourcing efforts or determine to reduce their use of
outsourcing, our ability to grow our business could be materially adversely
affected.
Our market is highly competitive and many of our competitors have
significant advantages that could adversely affect our business.
The global market for bearing components is highly competitive, with a
majority of production represented by the captive production operations of
certain large bearing manufacturers and the balance represented by independent
manufacturers. Captive manufacturers make components for internal use and for
sale to third parties. All of the captive manufacturers, and many independent
manufacturers, are significantly larger and have greater resources than do we.
Our competitors are continuously exploring and implementing improvements in
technology and manufacturing processes in order to improve product quality, and
our ability to remain competitive will depend, among other things, on whether we
are able to keep pace with such quality improvements in a cost effective manner.
The production capacity we have added over the last several years has
at times resulted in our having more capacity than we need, causing
our operating costs to be higher than expected.
We have significantly expanded our ball and roller production
facilities and capacity over the last several years. During 1997, we built an
additional manufacturing plant in Kilkenny, Ireland, and we continued this
expansion in 2000 through the formation of Euroball with SKF and INA/FAG. Our
ball and roller facilities currently are not operating at full capacity and our
results of operations for 2001 and the first and second quarters of 2002 were
adversely affected by the under-utilization of our production facilities, and we
face risks of further under-utilization or inefficient utilization of our
production facilities in future years.
5
The price of our common stock may be volatile.
The market price of our common stock could be subject to significant
fluctuations after this offering, and may decline below the public offering
price. Among the factors that could affect our stock price are:
o our operating and financial performance and prospects;
o quarterly variations in the rate of growth of our financial
indicators, such as earnings per share, net income and revenues;
o changes in revenue or earnings estimates or publication of
research reports by analysts;
o loss of any member of our senior management team;
o speculation in the press or investment community;
o strategic actions by us or our competitors, such as acquisitions
or restructurings;
o sales of our common stock by stockholders;
o general market conditions; and
o domestic and international economic, legal and regulatory factors
unrelated to our performance.
The stock markets in general have experienced extreme volatility that
has often been unrelated to the operating performance of particular companies.
These broad market fluctuations may adversely affect the trading price of our
common stock.
Provisions in our charter documents and Delaware law may inhibit a
takeover, which could adversely affect the value of our common stock.
Our certificate of incorporation and bylaws, as well as Delaware
corporate law, contain provisions that could delay or prevent a change of
control or changes in our management that a stockholder might consider favorable
and may prevent you from receiving a takeover premium for your shares. These
provisions include, for example, a classified board of directors and the
authorization of our board of directors to issue up to 5,000,000 preferred
shares without a stockholder vote. In addition, our restated certificate of
incorporation provides that stockholders may not call a special meeting.
We are a Delaware corporation subject to the provisions of Section 203
of the Delaware General Corporation Law, an anti-takeover law. Generally, this
statute prohibits a publicly-held Delaware corporation from engaging in a
business combination with an interested stockholder for a period of three years
after the date of the transaction in which such person became an interested
stockholder, unless the business combination is approved in a prescribed manner.
A business combination includes a merger, asset sale or other transaction
resulting in a financial benefit to the stockholder. We anticipate that the
provisions of Section 203 may encourage
6
parties interested in acquiring us to negotiate in advance with our board of
directors, because the stockholder approval requirement would be avoided if a
majority of the directors then in office approve either the business combination
or the transaction that results in the stockholder becoming an interested
stockholder.
These provisions apply even if the offer may be considered beneficial
by some of our stockholders. If a change of control or change in management is
delayed or prevented, the market price of our common stock could decline.
7
NN, INC.
NN manufactures and supplies high precision bearing components,
consisting of balls, rollers, seals and retainers, for leading bearing
manufacturers on a global basis. We are the leading independent manufacturer of
precision steel bearing balls for the North American and European markets. In
1998, we began implementing a strategic plan designed to position us as a
worldwide supplier of a broad line of bearing components. Through a series of
acquisitions executed as part of that plan, we have built on our strong core
ball business and greatly expanded our bearing component product offering.
Today, we offer the industry's most complete line of bearing components. We
emphasize engineered products that take advantage of our competencies in product
design and high tolerance manufacturing processes. Our bearing customers use our
components in fully assembled ball and roller bearings, which serve a wide
variety of industrial applications in the transportation, electrical,
agricultural, construction, machinery, mining and aerospace markets.
Our bearing component products presently account for approximately 90%
of our consolidated revenue and sales of high precision plastic products account
for the balance. We estimate that the size of the global market for balls,
rollers, seals and plastic retainers is $3.5 billion. Captive component
production of bearing manufacturers accounts for approximately 65% of this
market, while independent manufacturers currently serve approximately 35% of the
market. We believe that we are a leader in the independent manufacturers segment
of the market with a 14% market share. We also believe that the percentage of
the market served by independent manufacturers is growing due to the ongoing
component outsourcing trend among our major customers. Outsourcing components
enables our global bearing customers to focus on their core competencies in the
design and engineering of finished bearing technologies. In addition, it
provides them with significant financial advantages, including lower long-term
component costs and improved returns on invested capital.
We intend to continue to capitalize on this growing trend of
outsourcing within our global bearing customer base. Recent successes include
joining with our two largest bearing customers, SKF and INA/FAG, to create our
majority-owned subsidiary, Euroball. In forming Euroball, we contributed our
Ireland ball manufacturing facility, while SKF and INA/FAG contributed their
captive ball manufacturing facilities in Italy and Germany. On December 20,
2002, we purchased all of INA/FAG's interest in Euroball, increasing our
holdings in Euroball to 77 percent. This transaction is described in the Section
entitled "Recent Developments" beginning on page 1. Both SKF and INA/FAG
independently entered into long-term supply agreements designating Euroball as
their primary supplier of ball products in Europe. Through Euroball, we are
Europe's leading provider of precision balls.
We operate eight North American and European manufacturing facilities.
Our two U. S. ball and roller production facilities are located in Tennessee and
our Euroball subsidiary operates three manufacturing facilities located in
Ireland, Germany and Italy. Our seal, retainer and other plastic products are
manufactured in three facilities located in Connecticut, Texas and Mexico.
Our principal executive offices are located at 2000 Waters Edge Drive,
Johnson City, Tennessee 37604 and our telephone number is (423) 743-9151. Our
Internet website address is www.nnbr.com. Information contained on our website
is not part of this prospectus.
8
Cautionary Statement Concerning Forward-Looking Statements
This prospectus includes and incorporates by reference
"forward-looking statements" as that term is defined in the Private Securities
Litigation Reform Act of 1995. These forward-looking statements are based on our
current expectations, estimates and projections about the industry and markets
in which we operate. Words such as "expects," "anticipates," "intends," "plans,"
"believes," "seeks," "estimates" and variations of such words and similar
expressions are intended to identify such forward-looking statements. These
statements are not guarantees of future performance and involve risks,
uncertainties and assumptions, which are difficult to predict and many of which
are beyond our control, including those described in "Risk Factors" on pages 4
through 7 of this prospectus. Therefore, actual outcomes and results may differ
materially from what is expressed, forecasted or implied in such forward-looking
statements. We undertake no obligation to publicly update any forward-looking
statements, whether as a result of new information, future events or otherwise,
expect as required by applicable law.
9
USE OF PROCEEDS
Unless otherwise indicated in a prospectus supplement, we intend to
use the net cash proceeds from this offering to repay a portion of the
borrowings outstanding under the term loan portion of our existing credit
facilities as required under those arrangements. The term loan under our credit
facility expires on July 1, 2006 and bears interest at a floating rate equal to
LIBOR (1.38% at December 31, 2002) plus an applicable margin of 0.75% to 2.00%
based upon calculated financial ratios. Additionally, we may receive certain
non-cash manufacturing assets in connection with the potential asset acquisition
from SKF in Veenendaal, The Netherlands (as described in "Recent Developments
beginning on page 1) as proceeds from this offering, which we intend to use in
our business operations.
To the extent that the net cash proceeds of any offering pursuant to
this prospectus are not used to repay indebtedness under our credit facilities,
we anticipate that the proceeds will be used for general operational purposes,
which may include, but are not limited to, working capital, capital expenditures
and future acquisitions. In addition, the minority shareholder in Euroball, SKF,
has the right to require us to purchase its interest beginning January 2003
based on a formula price. The purchase price would be determined at the time SKF
exercises such right based on multiples of the annualized average monthly income
and average monthly EBITDA of Euroball, reduced by its short and long term
borrowings. Under this formula, which is set forth in detail in the Euroball
Shareholder Agreement, the purchase price increases as Euroball's annualized
average monthly income and average monthly EBITDA increase and decreases as its
short and long term borrowings increase. If SKF were to exercise that right, we
may use a portion of the shares in this offering to raise funds to purchase the
interest or we may issue shares of common stock directly as all or a portion of
the payment.
We will not receive any of the proceeds from sales of common stock by
the selling stockholders.
10
SELLING STOCKHOLDERS
The following table sets forth certain information regarding the
beneficial ownership of our common stock as of December 31, 2002, and as by the
stockholders who are selling shares of common stock in this offering, and as
adjusted to reflect the sale of shares offered in this prospectus. Unless
otherwise noted, to our knowledge each selling stockholder has sole voting and
investment power over the shares shown.
Shares Shares
Beneficially Owned Beneficially Owned
Prior to Offering Shares After Offering
------------------ Being ------------------
Number Percent (%)(1) Offered Number Percent (%)(1)
------ -------------- ------- ------ -----------
Richard D. Ennen (2) 2,844,668(3) 18.5 2,844,668 -0- -0-
Michael D. Huff (4) 662,227(5) 2.8 662,227 -0- -0-
Janet M. Huff 225,000 1.5 225,000 -0- -0-
Monica C. Ennen 129,900(6) * 129,900 -0- -0-
Deborah E. Bagierek 96,869(7) * 96,869 -0- -0-
--------------------------
* Amounts are less than one percent.
(1) Based on 15,369,807 shares of NN's common stock outstanding on December 31,
2002. The percentage of shares owned after the offering assumes that NN sells
3,830,000 shares pursuant to this prospectus.
(2) Mr. Ennen currently sits on the Company's Board of Directors and has since
the Company's formation in 1980. He was Chairman of the Board from the formation
of the Company until September of 2001.
(3) Includes 1,800,000 shares held by the Richard D. Ennen Charitable Remainder
Unitrust of which Mr. Ennen is the trustee and 200,000 shares held by the Ennen
Charitable Trust of which Mr. Ennen is the trustee. Mr. Ennen disclaims
beneficial ownership to the shares held by his former spouse, Monica Ennen, and
his daughter, Deborah E. Bagierek.
(4) Mr. Huff currently sits on the Company's Board of Directors and has since
the Company's formation in 1980.
(5) Includes (i) 23,000 shares subject to presently exercisable options, and
(ii) 225,000 shares held directly by Mr. Huff's spouse, for which Mr. Huff
disclaims beneficial ownership.
(6) All of Ms. Ennen's shares are held by the Monica Conway Ennen Trust, of
which Ms. Ennen is a trustee.
(7) All of Ms. Bagierek's shares are held by the Deborah Ennen Bagierek Trust,
of which Ms. Bagierek is a trustee.
11
PLAN OF DISTRIBUTION
Company Offering
We may offer and sell the shares being offered by this prospectus and
any accompanying prospectus supplement:
o Through agents;
o Through one or more underwriters or dealers;
o Through a block trade in which the broker or dealer engaged to
handle the block trade will attempt to sell the shares as agent,
but may position and resell a portion of the block as principal
to facilitate the transaction;
o Directly to one or more purchasers in exchange for cash or other
assets; or
o Through a combination of any of these methods of sale.
To the extent required, this prospectus may be amended and/or supplemented from
time to time to describe a specific plan of distribution.
Selling Stockholders Offering
The selling stockholders, separately or together, may offer and sell
their portion of the shares being offered by this prospectus and any
accompanying prospectus supplement only on the following terms and conditions:
1. No shares may be offered or sold by any selling stockholder
prior to March 31, 2003 unless the Company agrees otherwise.
2. Any shares offered or sold by any selling stockholder prior to
December 31, 2003 must be offered or sold through McDonald
Investments Inc. and Legg Mason Wood Walker Incorporated
together or with one or more underwriters or dealers.
3. Any sale by any selling stockholder must include a minimum of
500,000 shares in aggregate unless the Company agrees
otherwise.
4. The Company must receive at least five business days prior
written notice of any proposed sale by any selling
stockholder.
5. The Company may delay any sale by any selling stockholder for
up to 90 days by written notice to the selling stockholder.
6. In the event the Company and any selling stockholder
participates together in an offering under this prospectus,
the Company will have the right to choose to sell shares from
its portion of this offering in priority to sales by the
selling stockholders.
12
The selling stockholders and any underwriters, dealers or agents that
the selling stockholders use to sell their shares may be deemed to be
"underwriters" within the meaning of the Securities Act of 1933, as amended, and
any discount, commission or concession received by them and any profit on the
resale of shares as principal may be deemed to be underwriting discounts or
commissions under the Securities Act. Because the selling stockholders may be
deemed to be underwriters, the selling stockholders may be subject to the
prospectus delivery requirements of the Securities Act.
The selling stockholders may also transfer the common stock held by
them by gift or other non-sale related transfer, in which case the donees,
transferees or other successors-in-interest will be deemed to be selling
stockholders. The number of shares offered by a particular selling stockholder
under this prospectus will decrease as and when it takes any of the above
actions, although the aggregate number of shares offered by the selling
stockholders will remain unchanged. The plan of distribution for that selling
stockholder's shares will otherwise remain unchanged. In addition, any offered
shares by the selling stockholders covered by this prospectus that qualify for
sale pursuant to Rule 144 may be sold under Rule 144 under the Securities Act
rather than pursuant to this prospectus.
General Matters
We have agreed to pay the majority of the costs and expenses incurred
in connection with the registration under the Securities Act of the offered
shares, including:
o All registration and filing fees related to the company's portion
of the offering;
o Printing fees and expenses related to the company's portion of
the offering or to an offering including both Company shares and
shares owned by the selling stockholders; and
o Fees and disbursements of counsel, accountants and underwriters
for us.
The selling stockholders will pay:
o All registration and filing fees related to their portion of an
offering;
o Printing fees and expenses related to any offering exclusively of
their shares;
o Any underwriting discounts and commissions with respect to the
shares of common stock they sell hereunder;
o Fees and disbursements of any counsel retained by the selling
stockholders; and
o Transfer taxes, if any.
The distribution of the common stock may be effected from time to time
in one or more transactions:
o At a fixed price or prices, which may be changed;
13
o At market prices prevailing at the time of sale;
o At prices related to the market prices prevailing at the time of
sale; or
o At negotiated prices.
Offers to purchase the common stock may be solicited by agents
designated by us from time to time. Any agent involved in the offer or sale of
the common stock will be named, and any commissions payable by us to the agent
will be described, in the applicable prospectus supplement. Any agent may be
deemed to be an underwriter, as such term is defined in the Securities Act of
1933, of the common stock so offered and sold.
If we and/or any selling stockholders offer and sell common stock
through an underwriter or underwriters, we and/or the selling stockholders will
execute an underwriting agreement with the underwriter or underwriters at the
time the common stock is sold to them. The names of the specific managing
underwriter or underwriters, as well as any other underwriters, and the terms of
the transactions, including compensation of the underwriters and dealers, which
may be in the form of discounts, concessions or commissions, if any, will be
described in the applicable prospectus supplement, which will be used by the
underwriters to make resales of the common stock. That prospectus supplement and
this prospectus will be used by the underwriters to make resales of the common
stock. If underwriters are used in the sale of any common stock in connection
with this prospectus, the common stock will be acquired by the underwriters for
their own account and may be resold from time to time in one or more
transactions, including negotiated transactions, at fixed public offering prices
or at varying prices determined by the underwriters and us at the time of sale.
Common stock may be offered to the public either through underwriting syndicates
represented by managing underwriters or directly by one or more underwriters. If
any underwriter or underwriters are used in the sale of common stock, unless
otherwise indicated in a related prospectus supplement, the underwriting
agreement will provide that the obligations of the underwriters are subject to
some conditions precedent and that with respect to a sale of the common stock
the underwriters will be obligated to purchase all such common stock if any are
purchased.
If any underwriters are involved in the offer and sale, they will be
permitted to engage in transactions that maintain or otherwise affect the price
of the common stock. These transactions may include over-allotment transactions,
purchases to cover short positions created by the underwriter in connection with
the offering and the imposition of penalty bids. If an underwriter creates a
short position in the common stock in connection with the offering, i.e., if it
sells more common stock than set forth on the cover page of the applicable
prospectus supplement, the underwriter may reduce that short position by
purchasing the common stock in the open market. In general, purchases of common
stock to reduce a short position could cause the price of the common stock to be
higher than it might be in the absence of such purchases. As noted above,
underwriters may also choose to impose penalty bids on other underwriters and/or
selling group members. This means that if underwriters purchase common stock on
the open market to reduce their short position or to stabilize the price of the
common stock, they may reclaim the amount of the selling concession from those
underwriters and/or selling group members who sold such common stock as part of
the offering.
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Neither we nor any underwriter make any representation or prediction
as to the direction or magnitude of any effect that the transactions described
above may have on the price of the common stock. In addition, neither we nor any
underwriter make any representation that such underwriter will engage in such
transactions or that such transactions, once commenced, will not be discontinued
without notice.
If we and/or the selling stockholders offer and sell common stock
through a dealer, we, the selling stockholders or an underwriter will sell the
common stock to the dealer, as principal. The dealer may then resell the common
stock to the public at varying prices to be determined by the dealer at the time
of resale. Any such dealer may be deemed to be an underwriter, as such term is
defined in the Securities Act of 1933, of the common stock so offered and sold.
The name of the dealer and the terms of the transactions will be set forth in
the applicable prospectus supplement.
We and/or the selling stockholders may solicit offers to purchase the
common stock directly and we and/or the selling stockholders may sell the common
stock directly to institutional or other investors, who may be deemed an
underwriter within the meaning of the Securities Act of 1933 with respect to any
resales of the common stock. The terms of these sales will be described in the
applicable prospectus supplement.
We and/or the selling stockholders may enter into agreements with
agents, underwriters and dealers under which we and/or the selling stockholders
may agree to indemnify the agents, underwriters and dealers against certain
liabilities, including liabilities under the Securities Act of 1933, or to
contribute to payments they may be required to make with respect to these
liabilities. The terms and conditions of this indemnification or contribution
will be described in the applicable prospectus supplement. Some of the agents,
underwriters or dealers, or their affiliates may be customers of, engage in
transactions with or perform services for us and/or the selling stockholders in
the ordinary course of business.
We and/or the selling stockholders may authorize our respective
agents, dealers or underwriters to solicit offers to purchase common stock at
the public offering price under delayed delivery contracts. The terms of these
delayed delivery contracts, including when payment for and delivery of the
common stock sold will be made under the contracts and any conditions to each
party's performance set forth in the contracts, will be described in the
applicable prospectus supplement. The compensation received by underwriters or
agents soliciting purchases of common stock under delayed delivery contracts
will also be described in the applicable prospectus supplement.
15
LEGAL MATTERS
The validity of the common stock offered hereby will be passed upon
for us by Blackwell Sanders Peper Martin LLP, Two Pershing Square, 2300 Main
Street, Suite 1000, Kansas City, Missouri 64108.
EXPERTS
Our consolidated financial statements as of December 31, 2001 and
2000, and for each of the years in the two-year period ended December 31, 2001,
have been incorporated by reference in this prospectus and the registration
statement on Form S-3 in reliance upon the report of KPMG LLP, independent
accountants incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing. The audit report covering the
December 31, 2001 financial statements refers to a change in the Company's
method of accounting for derivative instruments and hedging activities.
Our consolidated financial statements as of December 31, 1999 and for
the year then ended have been incorporated in this registration statement by
reference to the Annual Report on Form 10-K for the year ended December 31,
2001, and have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any of these materials at
the SEC's Public Reference Room, 450 Fifth Street, N.W., Washington, D.C. 20549.
You may obtain information on the operation of the Public Reference Room by
calling the SEC at 1-800-SEC-0330. Our SEC filings, including the registration
statement, will also be available to you on the SEC's website. The address of
this website is http://www.sec.gov.
We have filed a registration statement on Form S-3 with the SEC to
register shares of our common stock. This prospectus is part of that
registration statement and, as permitted by the SEC's rules, does not contain
all of the information included in the registration statement. For further
information about us and this offering, you may refer to the registration
statement and its exhibits. You can review and copy the registration statement
and its exhibits at the public reference rooms maintained by the SEC or on the
SEC's website described above.
This prospectus may contain summaries of contracts or other documents.
Because they are summaries, they will not contain all of the information that
may be important to you. If you would like complete information about a contract
or other document, you should read the copy filed as an exhibit to the
registration statement.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to "incorporate by reference" the information we
file with them, which means that we can disclose important information to you by
referring you to those documents. The information we incorporate by reference is
considered to be a part of this prospectus, and information that we file with
the SEC at a later date will automatically update
16
or supersede this information. We incorporate by reference the following
documents as well as any future filing we will make with the SEC under Sections
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934:
o Our Annual Report on Form 10-K for the year ended December 31,
2001, as amended by Form 10-K/A;
o Our Quarterly Reports on Form 10-Q for the quarters ended March
31, 2002, June 30, 2002 and September 30, 2002;
o Our Current Reports on Form 8-K filed with the SEC on June 7,
2002, July 18, 2002, August 6, 2002, September 27, 2002, November
1, 2002, November 5, 2002, December 9, 2002 and December 20,
2002;
o The description of our common stock contained in the amended
registration statement on Form 8-A/A filed with the SEC on
November 22, 2002.
You may request a copy of these filings, at no cost, by written or
telephone request to:
NN, Inc.
Attn: Corporate Secretary
2000 Waters Edge Drive
Johnson City, Tennessee
(423) 743-9151
This prospectus may contain information that updates, modifies or is
contrary to information in one or more of the documents incorporated by
reference in this prospectus. Reports we file with the SEC after the date of
this prospectus may also contain information that updates, modifies or is
contrary to information in this prospectus or in documents incorporated by
reference in this prospectus. Investors should review these reports as they may
disclose a change in our business, prospects, financial condition or other
affairs after the date of this prospectus.
17
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses payable by us in
connection with the sale of Common Stock being registered. All amounts other
than the registration fee are estimates.
SEC registration fee $ 6,537
Legal fees and expenses 340,000
Accounting fees and expenses 120,000
Nasdaq National Market listing fee 22,500
Printing and engraving expenses 60,000
Miscellaneous fees and expenses 20,963
-----------------
Total $570,000
=================
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company has entered into indemnification agreements with certain
officers and directors of the Company. Under these agreements, the Company
agrees to hold harmless and indemnify each indemnitee generally to the full
extent permitted by Section 145 of the Delaware General Corporation Law (the
"DGCL") and against any and all liabilities, expenses, judgments, fines,
penalties and costs in connection with any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative to which the indemnitee is made a party by reason of the fact that
the indemnitee has, is or at the time becomes a director or officer of the
Company or any other entity at the request of the Company.
Section 145 permits a corporation to indemnify certain persons,
including officers and directors, who are (or are threatened to be made) parties
to any threatened, pending or completed legal action (whether civil, criminal,
threatened or investigative) for reason of their being officers or directors.
The indemnity may include expenses, attorneys' fees, judgments, fines and
reasonably incurred costs of settlement, provided the officer and director acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the corporation's best interest and, in the case of criminal proceedings, he had
no reasonable cause to believe that his conduct was illegal. The corporation may
indemnify officers and directors in derivative actions (in which suit is brought
by a shareholder on behalf of the corporation) under the same conditions, except
that no indemnification is permitted without judicial approval if the officer or
director is judged liable for negligence or misconduct in the performance of his
duty to the corporation. If the officer or director is successful on the merits
or otherwise in defense of any action referred to above, the corporation must
indemnify him against the expenses and attorneys' fees he actually and
reasonably incurred.
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The Company has obtained liability insurance coverage for its officers
and directors with respect to actions arising out of the performance of such
officer's or director's duty in his or her capacity as such.
ITEM 16. EXHIBITS
1.1* Form of Underwriting Agreement
3.1 Restated Certificate of Incorporation of the Company. (incorporated by
reference to Exhibit 3.1 of Company's Registration Statement on Form S-3
filed June 6, 2002)
3.2 Restated By-Laws of the Company. (incorporated by reference to Exhibit 3.2
of Company's Registration Statement on Form S-3 filed June 6, 2002)
4.1 The specimen certificate representing the Company's Common Stock, par value
$0.01 per share. (incorporated by reference to Exhibit 4.1 of Company's
Registration Statement on Form S-3 filed June 6, 2002)
4.2 Article IV, Article V (Sections 3 through 6), Article VI (Section 2) and
Article VII (Sections 1 and 3) of the Restated Certificate of Incorporation
of the Company (included in Exhibit 3.1).
4.3 Article II (Sections 7 and 12), Article III (Sections 2 and 15) and Article
VI of the Restated By-Laws of the Company (included in Exhibit 3.2).
5.1** Opinion of Blackwell Sanders Peper Martin LLP, counsel to the Company.
23.1 Consent of Blackwell Sanders Peper Martin LLP (included in Exhibit 5.1).
23.2 Consent of KPMG LLP, Independent Auditors.
23.3 Consent of PricewaterhouseCoopers LLP, Independent Auditors.
24 Powers of Attorney (included in the signature page to the Registration
Statement).
* To be filed by post-effective amendment or pursuant to a report to be filed
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, if
applicable, and incorporated herein by reference.
** Previously filed.
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ITEM 17. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than a 20
percent change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
registration statement; and
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the
registration statement or any material change to such information
in the registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) shall not apply if
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for the purposes
of determining any liability under the Securities Act of 1933, each filing of
the registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to any
II-3
charter provision, by-law or otherwise, the registrant has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than payment by the registrant of expenses incurred or paid
by a director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question of whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
II-4
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Johnson City, State of Tennessee, on February 6,
2003.
NN, Inc.
By: /s/ Roderick R. Baty
----------------------------------------
Roderick R. Baty
Chairman, Chief Executive Officer
and President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated:
Signature Title Date
--------- ----- ----
Chairman, Chief Executive Officer,
President and Director
/s/ Roderick R. Baty (Principal Executive Officer) February 6, 2003
------------------------------------
Roderick R. Baty
Vice President-Business Development and
Chief Financial Officer (Principal
/s/ David L. Dyckman Financial Officer) February 6, 2003
------------------------------------
David L. Dyckman
Treasurer, Secretary and Chief Accounting
Officer (Principal Accounting Officer)
/s/ William C. Kelly, Jr. February 6, 2003
------------------------------------
William C. Kelly, Jr.
Roderick R. Baty* February 6, 2003
Richard D. Ennen* February 6, 2003
Michael D. Huff* All of the February 6, 2003
G. Ronald Morris* Board of Directors February 6, 2003
Michael E. Werner* February 6, 2003
Steven T. Warshaw* February 6, 2003
James L. Earsley* February 6, 2003
*By: /s/ Roderick R. Baty
-----------------------------------
Roderick R. Baty
As Attorney-in-fact for the above-named
directors pursuant to the powers of
attorney duly executed by such persons
Index of Exhibits
Exhibit
Number Document
------ --------
1.1* Form of Underwriting Agreement
3.1 Restated Certificate of Incorporation of the Company. (incorporated by
reference to Exhibit 3.1 of Company's Registration Statement on Form S-3
filed June 6, 2002)
3.2 Restated By-Laws of the Company. (incorporated by reference to Exhibit 3.2
of Company's Registration Statement on Form S-3 filed June 6, 2002)
4.1 The specimen certificate representing the Company's Common Stock, par value
$0.01 per share. (incorporated by reference to Exhibit 4.1 of Company's
Registration Statement on Form S-3 filed June 6, 2002)
4.2 Article IV, Article V (Sections 3 through 6), Article VI (Section 2) and
Article VII (Sections 1 and 3) of the Restated Certificate of Incorporation
of the Company (included in Exhibit 3.1).
4.3 Article II (Sections 7 and 12), Article III (Sections 2 and 15) and Article
VI of the Restated By-Laws of the Company (included in Exhibit 3.2).
5.1** Opinion of Blackwell Sanders Peper Martin LLP, counsel to the Company.
23.1 Consent of Blackwell Sanders Peper Martin LLP (included in Exhibit 5.1).
23.2 Consent of KPMG LLP, Independent Auditors.
23.3 Consent of PricewaterhouseCoopers LLP, Independent Auditors.
24 Powers of Attorney (included in the signature page to the Registration
Statement).
* To be filed by post-effective amendment or pursuant to a report to be filed
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, if
applicable, and incorporated herein by reference.
** Previously filed.