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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 13, 1999.
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
JORE CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
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MONTANA 81-0465233
(State or other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
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45000 HIGHWAY 93 SOUTH
RONAN, MONTANA 59864
(406) 676-4900
(Address and Telephone Number of Registrant's Principal Executive Offices)
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AMENDED AND RESTATED JORE CORPORATION 1997 STOCK OPTION PLAN
COMMON STOCK PURCHASE OPTION, DATED FEBRUARY 10, 1999, BETWEEN JORE CORPORATION
AND
WILLIAM M. STEELE, AS TRUSTEE FOR THE STEELE FAMILY TRUST
COMMON STOCK PURCHASE OPTION, DATED FEBRUARY 10, 1999, BETWEEN JORE CORPORATION
AND GARY S. HOUCK
(Full Title of the Plans)
------------------------
DAVID H. BJORNSON, ESQ.
45000 HIGHWAY 93 SOUTH
RONAN, MONTANA 59864
(406) 676-4900
(Name, Address and Telephone Number of Agent for Service)
------------------------
COPIES TO:
WILLIAM E. VAN VALKENBERG, ESQ.
VAN VALKENBERG FURBER LAW GROUP P.L.L.C.
1325 FOURTH AVENUE, SUITE 1200
SEATTLE, WASHINGTON 98101-2509
TELEPHONE: (206) 464-0460
FACSIMILE: (206) 464-2857
------------------------
CALCULATION OF REGISTRATION FEE
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PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF SECURITIES TO BE AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING REGISTRATION
REGISTERED REGISTERED(1) SHARE(2) PRICE(2) FEE(2)
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Common Stock, without par value............. 1,611,064 $11.9375 $19,232,076 $5,346.52
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(1) Includes an indeterminate number of additional shares which may be necessary
to adjust the number of shares reserved for issuance pursuant to the Amended
And Restated Jore Corporation 1997 Stock Option Plan (the "Plan"), the
Common Stock Purchase Option, dated February 10, 1999, between Jore
Corporation and William M. Steele, as trustee for The Steele Family Trust or
the Common Stock Purchase Option, dated February 10, 1999, between Jore
Corporation and Gary S. Houck as the result of any future stock split, stock
dividend or similar adjustment of the Registrant's outstanding Common Stock.
(2) Estimated solely for purposes of calculating the registration fee pursuant
to Rules 457(c) and 457(h) under the Securities Act of 1933, as amended. The
price per share and aggregate offering price are based upon an estimated
price per share of $11.9375 based on the average of the high ($12.00) and
low ($11.875) sales prices for the Registrant's Common Stock on October 12,
1999, as reported by the Nasdaq National Market.
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EXPLANATORY NOTE
Jore Corporation ("Jore" or the "Company") has prepared this Registration
Statement in accordance with the requirements of Form S-8 under the Securities
Act of 1933, as amended (the "1933 Act"), to register shares of its Common
Stock. The information required by Part I with respect to Amended And Restated
Jore Corporation 1997 Stock Plan is included in documents sent or given to
participants in the Plan pursuant to Rule 428(b)(1) of the Securities Act. In
addition, under cover of this Form S-8 is a Reoffer Prospectus that Jore
prepared in accordance with Part I of Form S-3 under the Securities Act of 1933,
as amended. The Reoffer Prospectus may be utilized for reofferings and resales
of up to 311,064 shares of Common Stock of which 155,532 may be acquired by
William M. Steele, as trustee of the Steele Family Trust under the Common Stock
Purchase Option, dated February 10, 1999, between Jore Corporation and William
M. Steele and of which 155,532 may be acquired by Gary S. Houck under the Common
Stock Purchase Option, dated February 10, 1999, between Jore Corporation and
Gary S. Houck.
<PAGE>
PART I
INFORMATION REQUIRED IN THE 10(a) PROSPECTUS
<PAGE>
JORE CORPORATION
FORM S-8 CROSS REFERENCE SHEET SHOWING LOCATION OF INFORMATION REQUIRED
BY PART I OF FORM S-3
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FORM S-3 ITEM NUMBER LOCATION/HEADING IN PROSPECTUS
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1. Forepart of Registration Statement and Outside Cover
page of Prospectus................................. Front Cover page
2. Inside Front and Outside Back Cover Page of
Prospectus......................................... Available Information; Incorporation of Certain
Information by Reference
3. Summary Information, Risk Factors and Ratio of
Earnings to Fixed Charges.......................... Risk Factors
4. Use of Proceeds...................................... Not applicable
5. Determination of Offering Price...................... Not applicable
6. Dilution............................................. Not applicable
7. Selling Security Holder.............................. Selling Security Holder
8. Plan of Distribution................................. Plan of Distribution
9. Description of Securities to be Registered........... Not Applicable
10. Interests of Named Experts and Counsel............... Not Applicable
11. Material Changes..................................... Not Applicable
12. Incorporation of Certain Information................. Documents Incorporated by Reference
13. Disclosure of Commission Position on Indemnification
for Securities Act Liabilities..................... Indemnification
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<PAGE>
REOFFER PROSPECTUS
SHARES OF COMMON STOCK
JORE CORPORATION
This Reoffer Prospectus relates to 311,064 shares of the common stock, par
value $0.001 (the "Common Stock"), of Jore Corporation ("Jore" or the
"Company"), which may be offered from time to time by William M. Steele, as
trustee for The Steele Family Trust and Gary S. Houck (the "Registered
Stockholders"). It is anticipated that the Registered Stockholders will offer
shares for sale at prevailing prices on the Nasdaq National Market System on the
date of sale. The Company will receive no part of the proceeds of sale made
hereunder. All expenses of registration incurred in connection with this
offering are being borne by the Company, but all selling and other expenses
incurred by the Registered Stockholders will be borne by such Registered
Stockholder.
The Common Stock is traded on the Nasdaq National Market System under the
symbol "JORE".
The Registered Stockholders and any broker executing selling orders on
behalf of the Registered Stockholder may be deemed to be "underwriters" within
the meaning of the Securities Act of 1933, as amended (the "1933 Act"), in which
event commissions received by such broker may be deemed to be underwriting
commissions under the 1933 Act.
THESE SECURITIES INVOLVE A HIGH DEGREE OF RISK AND SHOULD
BE CONSIDERED ONLY BY PERSONS WHO CAN AFFORD
THE LOSS OF THEIR ENTIRE INVESTMENT.
SEE "RISK FACTORS" BEGINNING ON PAGE 5.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
You should rely only on the information contained in this prospectus. We
have not authorized anyone to provide you with information that is different
from that contained in this prospectus. This prospectus may only be used where
it is legal to sell these securities. The information contained in this
prospectus is accurate only as of the date of this prospectus, regardless of the
time of delivery of this prospectus or of any sale of the common stock.
The date of this Prospectus is October 13, 1999.
<PAGE>
AVAILABLE INFORMATION
The Company became subject to the informational reporting requirements of
the Securities Exchange Act of 1934, as amended (the "1934 Act") upon the first
date on which its Common Stock was registered under Section 12(g) of the 1934
Act and in accordance therewith will file reports, proxy statements and other
information with the Securities and Exchange Commission (the "SEC"). Such
reports, proxy statements and other information can be inspected and copied at
the Public Reference Room of the SEC, 450 Fifth Street, N.W., Washington, D.C.
20549 and at the SEC's regional offices at 219 South Dearborn Street, Chicago,
IL 60604; 26 Federal Plaza, New York, NY 10007; and 5757 Wilshire Boulevard, Los
Angeles, CA 90036, at prescribed rates. The Commission also maintains a web site
on the Internet that contains reports, proxy and information statements, and
other information regarding registrants, including Jore Corporation, that file
electronically with the Commission at http://www.sec.gov. The Common Stock is
quoted on the Nasdaq National Market System. Reports, proxy statements,
informational statements and other information concerning the Company can be
inspected at the offices of the National Association of Securities Dealers, Inc.
at 1735 K Street, N.W., Washington, D.C. 20006.
The Company intends to furnish its stockholders with annual reports
containing additional financial statements and a report thereon by independent
certified public accountants.
A copy of any document incorporated by reference in the Registration
Statement (not including exhibits to the information that is incorporated by
reference unless such exhibits are specifically incorporated by reference into
the information that the Registration Statement incorporates) of which this
Reoffer Prospectus forms a part but which is not delivered with this Reoffer
Prospectus will be provided by the Company without charge to any person
(including any beneficial owner) to whom this Reoffer Prospectus has been
delivered upon the oral or written request of such person. Such request should
be directed to David Bjornson, Jore Corporation, 45000 Highway 93 South, Ronan,
Montana 59864. Our telephone number is (406) 676-4900.
TABLE OF CONTENTS
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PAGE
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THE COMPANY............................................................................................... 3
RISK FACTORS.............................................................................................. 5
REGISTERED STOCKHOLDERS................................................................................... 13
PLAN OF DISTRIBUTION...................................................................................... 14
USE OF PROCEEDS........................................................................................... 15
DOCUMENTS INCORPORATED BY REFERENCE....................................................................... 15
INDEMNIFICATION........................................................................................... 15
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2
<PAGE>
THE COMPANY
Jore Corporation is a leader in the design, manufacture and marketing of
innovative power tool accessories and hand tools for the do-it-yourself and
professional craftsman markets. We offer a comprehensive system of proprietary
drilling and driving products that save users time through enhanced
functionality, productivity and ease of use. We manufacture our products using
advanced technologies and equipment designs, thus achieving competitive
advantages in cost, quality and production capacity. Our products are sold under
private labels to the industry's largest retailers and power tool manufacturers,
such as Sears, Roebuck and Co., TruServ Corporation, Black & Decker Corporation
and Makita Corporation. In addition, we recently signed an agreement with The
Stanley Works that grants us an exclusive license to sell power tool accessories
under the STANLEY-C- brand.
The cornerstone of our power tool accessories portfolio is a patented quick
change drilling and driving system that enables single-handed interchangeability
of a full range of hex-shank drilling, driving and surface preparation
accessories. In addition to quick interchangeability, our hex-shank accessories
provide enhanced torque transmission as compared to traditional round-shank
products. Our system also includes our patented reversible drill and driver and
screw guide accessories. We are broadening our product portfolio to include a
variety of other power tool accessories such as saw blades, router bits and
other accessories. We also have recently begun to offer several proprietary hand
tools with innovative features for improved functionality.
The development and commercial availability of cordless power tools since
the early 1980s has created a growing installed base of these tools among
do-it-yourself consumers, professional craftsmen and industrial users. The
increased use of cordless power tools has led to a growing demand for new and
improved power tool accessories. According to industry sources and our market
research, we believe that the worldwide addressable market for our products is
approximately $13.0 billion in 1999. In the United States in 1999, our
addressable market is approximately $5.7 billion per year, consisting of $3.0
billion for power tool accessories and $2.7 billion for hand tools. The drilling
and driving accessories market in 1999 represents approximately $1.3 billion of
the domestic power tool accessories market. The remainder of the power tool
accessories market consists of saw blades, router bits and other accessories.
Our objective is to be the leading manufacturer of innovative products for
the global power tool accessories market. Our growth strategy includes the
following specific elements:
--EXPAND THE INSTALLED BASE AND APPLICATIONS OF OUR DRILLING AND DRIVING
SYSTEM--The base of consumers using our proprietary quick change connectors is
rapidly expanding. We believe that we can provide many new and complementary
hex-shank accessory products into this growing installed base. Accordingly, we
intend to develop and introduce new accessories within our drilling and driving
system.
--BROADEN OUR PRODUCT PORTFOLIO--We are broadening our product portfolio to
include other innovative products, such as select hand tools with proprietary
features. In addition, we are using our proprietary manufacturing processes to
achieve cost leadership in producing traditional round-shank drill bits. We also
will introduce other power tool accessories and hand tools under the
STANLEY-Registered Trademark- brand and our customers' private labels. We will
continue to seek opportunities to license new or existing products and
technologies to complement our internal product development efforts.
--ENHANCE EXISTING CUSTOMER RELATIONSHIPS--We believe that there are
significant opportunities to expand our sales to existing customers. We plan to
increase the number of products available to our customers, establish a presence
in customer stores at which Jore Corporation products are currently not sold,
and offer our products under different brands to enable our customers to
effectively target various price points and consumer segments.
3
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--DEVELOP NEW CUSTOMER RELATIONSHIPS--In order to broaden our customer base,
we are developing and expanding our relationships with retailers such as The
Home Depot Inc., Lowes Companies, Inc., Ace Hardware Corporation and others. We
believe that our ability to offer our products under both private labels and the
STANLEY-C- brand greatly improves our ability to supply these retailers.
--EXPAND INTO THE INDUSTRIAL MARKET--We believe that the rapid
interchangeability of our accessories will also offer productivity enhancements
to industrial users. Consequently, we intend to introduce our drilling and
driving system to the industrial market, which we believe is approximately equal
in size to the retail market that we presently serve. We also plan to
competitively supply the industrial market with our internally produced
round-shank drill bits.
--EXPAND INTO FOREIGN MARKETS--We have expanded the distribution of our
products into Canada and intend to begin selling our products in Europe. We will
continue to evaluate opportunities to offer our products in other foreign
markets.
We are incorporated in Montana and our principal offices are located at 45000
Highway 93 South, Ronan, Montana 59864. Our telephone number is (406) 676-4900.
4
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RISK FACTORS
THIS OFFERING INVOLVES A HIGH DEGREE OF RISK. IF ANY OF THE FOLLOWING RISKS
MATERIALIZE, OUR BUSINESS, OPERATING RESULTS, AND FINANCIAL CONDITION COULD BE
MATERIALLY HARMED. THIS COULD CAUSE THE TRADING PRICE OF OUR COMMON STOCK TO
DECLINE, AND YOU COULD LOSE ALL OR PART OF YOUR INVESTMENT. THIS PROSPECTUS
CONTAINS FORWARD-LOOKING STATEMENTS THAT INVOLVE KNOWN AND UNKNOWN RISKS AND
UNCERTAINTIES, SUCH AS STATEMENTS OF OUR PLANS, OBJECTIVES, EXPECTATIONS, AND
INTENTIONS. ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE DISCUSSED IN THE
FORWARD-LOOKING STATEMENTS AS A RESULT OF CERTAIN FACTORS, INCLUDING THOSE SET
FORTH BELOW. YOU SHOULD CAREFULLY CONSIDER THE RISKS AND UNCERTAINTIES DESCRIBED
BELOW AND THE OTHER INFORMATION IN THIS PROSPECTUS BEFORE INVESTING IN OUR
COMMON STOCK.
OUR RAPID GROWTH MAY MAKE IT DIFFICULT TO EFFECTIVELY ALLOCATE OUR RESOURCES
AND MANAGE OUR BUSINESS
We are experiencing significant growth in the sales of our products, the
number of employees and the amount of our production and cannot assure that we
will be able to manage any future growth effectively. We recently expanded our
operations by hiring additional personnel, increasing production capacity and
upgrading our information systems. Continued growth could strain our management,
production, engineering, financial and other resources. To manage our growth
effectively, we must add manufacturing capacity while maintaining high levels of
quality, manufacturing efficiency and customer service. We also must continue to
enhance our operational, financial and management systems and successfully
attract, train, retain and manage our employees. Any failure to manage our
growth effectively could have a material adverse effect on our business,
financial condition and results of operations, such as declines in revenues and
profit margins.
THE LOSS OF A LARGE CUSTOMER COULD RESULT IN A SUBSTANTIAL DECREASE IN
REVENUES
Historically, most of our sales have been derived from a small number of
customers and, due to the continuing consolidation of the industry's
distribution channels, we expect a significant portion of our future sales to
remain concentrated among a limited number of customers. In 1997, sales to
Sears, Black & Decker/DeWalt, Makita and Home Depot accounted for 31.9%, 21.5%,
25.6% and 17.0%, respectively, of our net revenues. In 1998, sales to Sears,
Black & Decker/DeWalt and Makita accounted for 60.2%, 17.2% and 14.5%,
respectively, of our net revenues. A significant decrease in sales to, or the
loss of, any of our major customers would have a material adverse effect on our
business, prospects, operating results and financial condition, such as a
substantial decline in revenues.
THE MARKETING OF OUR PRODUCTS UNDER THE STANLEY-C- BRAND MAY BE UNSUCCESSFUL
AND MAY ADVERSELY AFFECT OUR RELATIONSHIPS WITH EXISTING CUSTOMERS
In April 1999, we signed an agreement with The Stanley Works that grants us
the exclusive license to sell power tool accessories under the STANLEY-C- brand
and indemnifies us for damages and costs incurred in connection with any
infringement claims arising out of our use of Stanley's trademarks and trade
dress. Some of our existing customers may view our license arrangement with
Stanley unfavorably, and therefore reduce or stop purchases of our products. For
example, in June 1999, Black & Decker advised us that our proposed introduction
of STANLEY-C- branded power tool accessories in yellow and black packaging would
violate Black & Decker's trademark rights under its DEWALT-C- brand. In response
to Black & Decker's assertions, Stanley filed a lawsuit, which we joined as a
co-plaintiff, seeking a judgment that, among other things, the use of the colors
yellow and black
5
<PAGE>
with the STANLEY-C- name or trademark on power tool accessories does not
infringe or dilute Black & Decker's trademark rights. On July 7, Black & Decker
asserted counterclaims against Stanley and Jore for unfaircompetition and
trademark and trade dress infringement. This lawsuit poses the risks that:
--We may be required to modify the colors of the packaging and promotional
materials for our STANLEY-C--branded products which could diminish the value of,
and limit our sales and growth prospects associated with, the STANLEY-C- brand;
--We could incur significant expenses and be required to pay damages if
Stanley fails to fulfill its indemnification obligations to us; and
--Black & Decker could limit or terminate its business relationship with us.
The occurrence of any of these events could have a material adverse effect
on our business, operating results and financial condition by increasing our
costs, reducing our sales and diverting management resources. In addition,
retailers may choose not to offer our products under the STANLEY-C- brand. We
cannot be certain that the time and resources we will spend marketing our
products under the STANLEY-C- brand will lead to increased sales and
profitability. Other potential risks in connection with this licensing agreement
include:
--The failure by Stanley to maintain the integrity and quality of its brand
image in the minds of its consumers; and
--Our inability to meet the performance requirements of the licensing
agreement may cause Stanley to terminate our agreement.
OUR FAILURE TO DEVELOP NEW DISTRIBUTION CHANNELS COULD DIMINISH OUR REVENUE
GROWTH
We cannot assure that we will be able to develop new distribution channels
or penetrate the industrial market or that this growth strategy can be
implemented profitably. Our growth depends, in part, on our ability to develop
new distribution channels, including penetration of the industrial market for
our products. Challenges that we face in developing new distribution channels
include:
--Obtaining customer acceptance of our products;
--Managing existing customer relationships;
--Establishing relationships with new customers;
--Displacing incumbent vendor relationships; and
--Successfully introducing new products under the STANLEY-C- brand.
Our failure to develop new distribution channels could have a material
adverse effect on our business, operating results, and financial condition,
particularly future revenue levels.
THE LOSS OF ANY OF OUR KEY PERSONNEL COULD ADVERSELY AFFECT OUR ABILITY TO
MANAGE OUR BUSINESS
Our performance and future success depends to a significant extent on our
senior management and technical personnel, and in particular on the skills,
experience, and continued efforts of Matthew Jore, Jore Corporation's founder,
President and Chief Executive Officer. The loss of Matthew Jore or any of our
other key personnel could have a material adverse effect on our business and
prospects. We have an employment agreement with Matthew Jore but do not have
employment agreements with any of our other employees.
OUR PRODUCTION PROCESSES COULD BE DISRUPTED AND OUR COST OF PRODUCTION COULD
INCREASE SIGNIFICANTLY IF OUR MANUFACTURING
6
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EQUIPMENT DOES NOT MEET PERFORMANCE EXPECTATIONS OR IS NOT AVAILABLE FOR FUTURE
PURCHASE
The failure of our manufacturing equipment to perform reliably and as
designed, our inability to source such equipment from present suppliers, or the
obsolescence of our equipment could disrupt our production processes, reduce our
sales and increase production costs. Our business is dependent on the successful
implementation and operation of advanced manufacturing technologies. Our
manufacturing equipment may fail to meet our performance requirements or
continue to operate reliably because of unexpected design flaws or manufacturing
defects. Moreover, we may be unable to continue to obtain equipment and supplies
from our present suppliers if they cease producing or selling such equipment or
supplies or opt not to sell to us. In addition, we cannot be certain that our
manufacturing processes will remain competitive with new and evolving
technologies.
OUR INABILITY TO INTRODUCE NEW PRODUCTS THAT ARE ACCEPTED BY THE MARKET
COULD ADVERSELY AFFECT OUR SALES, OUR REPUTATION AS AN INNOVATIVE MANUFACTURER
AND OUR ABILITY TO OBTAIN NEW CUSTOMERS
Our future success will depend in part on our continuous and timely
development and introduction of new products that address evolving market
requirements. We cannot assure that our new products will be introduced on a
timely basis or will achieve market acceptance. We may be unable to successfully
develop and produce new products because of a lack of market demand, production
capacity constraints or the lack of relevant technical and engineering
expertise. Factors affecting the market acceptance of our new products include:
--Functionality, quality and pricing;
--Demand from end-users;
--Favorable reviews in trade publications;
--Adequate marketing support;
--The introduction of competitive products; and
--General trends in the power and hand tool industries and the home
improvement market.
OUR GROWTH STRATEGY DEPENDS IN PART ON OUR EXPANSION INTO FOREIGN MARKETS,
WHICH MAY BE DIFFICULT OR UNPROFITABLE
We intend to expand distribution of our products in foreign markets. Because
of the size and continued growth of the power tools accessories market outside
North America, the failure to successfully enter foreign markets could limit our
growth prospects. In our attempt to enter foreign markets, we may expend
financial and human resources without a corresponding increase in revenues and
profitability. We cannot assure that we will be able to penetrate foreign
markets or that this growth strategy can be implemented profitably. Penetrating
and conducting business in foreign markets involves challenges, including:
--Local acceptance of our products;
--Currency controls and fluctuations in foreign exchange rates;
--Regulatory requirements such as tariffs and trade barriers;
--Longer payment cycles and increased difficulty in collecting accounts
receivable;
--Unfavorable tax consequences; and
--Transportation and logistics.
7
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WE FACE COMPETITION IN THE POWER TOOL ACCESSORIES AND HAND TOOLS MARKETS
The power tool accessories and hand tools markets are mature and highly
competitive. We cannot assure that we will be able to compete in our target
markets. In the power tool accessory market competitors include Vermont American
Corporation, Black & Decker Corporation, Greenfield Industries, Inc., a
wholly-owned subsidiary of Kennametal Inc., American Tool Companies, Inc.,
Snap-On Incorporated and others, as well as a number of other companies that
supply products under private labels to OEM and retail customers. Some of these
competitors offer products similar to ours or different products with similar
functionalities. In particular, Black & Decker has developed a product line with
similar characteristics to our quick-change system. In the hand tool market,
competitors include American Tool Companies, Inc., Cooper Industries, Inc., The
Stanley Works and others, including foreign manufacturers such as Sandvik AB.
Many of our competitors are established companies that have significantly
greater financial, technical, manufacturing, sales and marketing, and support
resources than Jore Corporation. In addition, many of our competitors own
well-known brands, enjoy large end-user bases, and benefit from long-standing
customer relationships. We believe that consumers in our markets generally are
loyal to a particular brand. Therefore, it may be difficult to generate sales to
consumers who have purchased products from competitors. Our failure to compete
successfully against current or future competitors would have material adverse
effects on our business, operating results, and financial condition including
loss of customers, declining revenues and loss of market share.
OUR DEPENDENCE ON CUSTOMER FORECASTS TO MANAGE OUR BUSINESS MAY CAUSE US TO
MISALLOCATE OUR PRODUCTION, INVENTORY OR OTHER RESOURCES
Significant or numerous cancellations, reductions or delays in orders by a
principal customer or a group of customers could have a material adverse effect
on our revenues, inventory levels and profit margins. We rely on our customers'
forecasts to anticipate their future volume of orders, which typically do not
become contractual obligations until approximately 30 days prior to shipment. We
rely on these forecasts when making commitments regarding the level of business
that we will seek and accept, the mix of products that we intend to manufacture,
the timing of production schedules, and our use of equipment and personnel. The
size and timing of orders placed by our customers varies due to a number of
factors, including consumer demand, inventory management by customers, our
customers' manufacturing or marketing strategies, and fluctuations in demand for
competing and complementary products. In addition, a variety of economic
conditions, both specific to individual customers and generally affecting the
markets for our products, may cause customers to cancel, reduce or delay orders
that were previously made or anticipated.
OUR BUSINESS IS SEASONAL AND OUR OPERATING RESULTS ARE SUBJECT TO QUARTERLY
FLUCTUATIONS
Seasonality and unanticipated changes in customer demand could cause our
revenue, expenses, inventory levels and operating results to fluctuate.
Currently, the majority of our sales occur during the third and fourth fiscal
quarters and our operating results depend significantly on the holiday selling
season. In 1997 and 1998, approximately 69% and 67%, respectively, of our net
revenues were generated during the third and fourth quarters. To support this
sales peak, we anticipate demand and build inventories of finished goods
throughout the first two fiscal quarters. In addition, our customers may reduce
or delay their orders during the first two fiscal quarters to balance their
inventory between the holiday selling seasons. As a result, our levels of raw
materials and finished goods inventories tend to be at their highest, relative
to sales, during the first half of the year. These factors can cause variations
in our quarterly operating results and potentially expose us to greater adverse
effects of changes in economic and industry trends. In addition, a substantial
portion of our sales depends upon receiving purchase orders for products to be
manufactured and shipped in the same quarter in which
8
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these orders are received. While we monitor our customers' needs, we typically
have a small backlog relative to net revenues, and a significant portion of our
orders are placed for production and delivery within a few weeks from receipt of
the order. As a result, the timing of revenue may be affected by changes in
production volume in response to fluctuations in customer and end-user demand,
introduction of new products by customers, and balancing of customers' inventory
to their sales estimates.
UNSATISFACTORY PERFORMANCE OF OUR NEW INFORMATION TECHNOLOGY SYSTEM COULD
SLOW OUR GROWTH
The satisfactory performance and reliability of our information systems are
essential to our operations and continued growth. We have implemented a new
information technology system that became operational during August 1999. If the
system fails to perform reliably or otherwise does not meet our expectations, we
could experience design, manufacturing, and shipping delays which, in turn,
could increase our costs and result in deferred or lost sales. Failure to
maintain our new information system, or unsatisfactory performance of the
system, could disrupt manufacturing operations and reporting systems, cause
delays in production and shipping of product, and adversely affect our
responsiveness to customers.
THE LOSS OR NON-PERFORMANCE OF OUR SALES REPRESENTATIVE COULD DISRUPT OUR
SALES EFFORTS
We coordinate our sales and marketing activities with a sales
representative, Manufacturers' Sales Associates, LLC. In 1998, Manufacturers'
Sales Associates and its affiliate received a commission on all of our sales.
The failure or inability of Manufacturers' Sales Associates to represent us
effectively, maintain relationships with our customers, attract new customers,
or satisfactorily perform marketing activities could adversely affect our
business, customer relationships, reputation and prospects for growth. Moreover,
Manufacturers' Sales Associates can terminate its relationship with us at any
time without penalty. Termination of this relationship would require us either
to conduct all of our sales and marketing activities internally or retain
another sales and marketing representative. Any such change could disrupt our
sales efforts and damage our customer relationships.
EXISTING AND POTENTIAL LITIGATION MAY DIVERT MANAGEMENT RESOURCES AND COULD
ADVERSELY AFFECT OUR OPERATING RESULTS
From time to time we have been, and expect to continue to be, subject to
legal proceedings and claims in the ordinary course of our business. Such
claims, even if not meritorious, could require the expenditure of significant
financial and managerial resources. On August 16, 1999, Pete K. Block and Paul
K. Block instituted separate actions in Montana District Court against us,
Matthew Jore individually and dba Jore Enterprises, Michael Jore and Merle Jore.
In their complaints, the Blocks alleged, among other things, that they are
collectively entitled to a 25% interest in the capital stock of Jore Enterprises
and any successor corporation. Their lawsuits are based in part upon an
agreement, dated October 10, 1989, between the Blocks and Matthew, Michael and
Merle Jore. The Blocks seek as remedies dissolution of Jore Corporation and a
preliminary injunction preventing us from proceeding with this offering. In
addition, the Blocks have alleged that they have suffered damages of not less
than $10 million and are seeking compensatory and punitive damages, attorneys'
fees and costs, and injunctive relief preventing any reorganization or sale that
would cause them to collectively own less than 25% of the equity of Jore
Enterprises and any successor corporation.
Litigation is inherently uncertain, and we cannot assure that we and/or the
Jores will prevail in the suit. To the extent that the Blocks become entitled to
shares of our common stock as a result of the suit, we may be required to
recognize an expense equal to the number of shares issued multiplied by the fair
value of the common stock on the date of issuance. Satisfaction of such
liabilities through the
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issuance of shares could result in the recognition of future expenses, which
could have a material adverse effect on our results of operations.
WE SUBSTANTIALLY RELY ON CONTRACTS WITH AFFILIATES WHOSE INTERESTS MAY NOT
ALWAYS COINCIDE WITH THOSE OF OUR PUBLIC SHAREHOLDERS
The existence of, or potential for, conflicts-of-interest between two of our
directors and us could adversely influence decisions relating to sales and
marketing and printing and packaging of our products. We rely substantially on
our sales representative, Manufacturers' Sales Associates, for sales and
marketing assistance and on Printing Press Incorporated for printing and
packaging materials. Our director William M. Steele is the managing member and
owns 50% of Manufacturers' Sales Associates, and our director Bruce Romfo owns
30% of Printing Press Incorporated. In 1998, Manufacturers' Sales Associates and
its affiliate earned an aggregate of $1.8 million in sales commissions and we
purchased $2.0 million printing and packaging materials from Printing Press.
Because of their significant ownership stakes in these two entities, the
interests of Messrs. Steele and Romfo may diverge from those of Jore Corporation
and its public shareholders.
UNFAVORABLE CHANGES IN COSTS AND AVAILABILITY OF RAW MATERIALS MAY ADVERSELY
AFFECT OUR MANUFACTURING OPERATIONS AND ABILITY TO SATISFY OUR CUSTOMERS' ORDERS
We purchase raw materials, key components and certain products from third
party vendors. Although there are alternative sources for these raw materials,
components, and products, we could experience manufacturing and shipping delays
if it became necessary to change or replace current suppliers, or to produce
certain components or products internally. In addition, the prices of raw
materials supplied by certain vendors are influenced by a number of factors,
including general economic conditions, competition, labor costs, and general
supply levels. Our inability to obtain reliable and timely supplies of
out-sourced products and components and raw materials on a cost effective basis,
or any unanticipated change in suppliers, could have a material adverse effect
on our manufacturing operations, revenues and profitability.
WE DEPEND ON PATENT, TRADEMARK AND TRADE SECRET PROTECTION TO MAINTAIN OUR
MARKET POSITION
Our success depends in part on our ability to obtain patent protection for
our products, maintain trade secret protection for our proprietary processes,
and operate without infringing on the proprietary rights of others. Our existing
U.S. and foreign patents expire between 2002 and 2012. We have filed, and intend
to file, applications for additional patents covering our products. We cannot be
certain that any of these patent applications will be granted, that any future
inventions that we develop will be patentable or will not infringe the patents
of others, or that any patents issued to or licensed by us will provide us with
a competitive advantage or adequate protection for our technology. In addition,
we cannot assure that any patents issued to or licensed by us will not be
challenged, invalidated or circumvented by others. We believe that trademarks
owned or licensed by us enhance our position in the marketplace and are
important to our business. Our inability to use any of our trademarks could
adversely affect our customer relationships and revenues. We cannot be certain
that we will retain full rights to use our trademarks in the future.
THE COST OF PROTECTING AND DEFENDING OUR PATENTS, TRADEMARKS AND TRADE
SECRETS MAY BE SIGNIFICANT
The defense and prosecution of patent claims, and litigation involving
intellectual property rights generally, is both costly and time consuming. If
any of our products are found to have infringed any patent or other third party
proprietary right, we may be unable to obtain licenses to continue to
manufacture and sell such products or may have to pay damages as a result of
such infringement. We endeavor to protect our trade secrets by entering into
confidentiality agreements with third parties,
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employees and consultants and generally control access to our facilities and
distribution of our proprietary documentation and other materials.
Confidentiality and non-disclosure obligations are difficult to enforce,
however, and we may lack an adequate remedy for breach of a confidentiality
agreement. Moreover, a third party could gain access to our trade secrets
through means other than by breach of a confidentiality agreement, or could
develop independently a process substantially similar to our trade secrets. In
addition, the laws of other countries in which we market or may market our
products may afford little or no effective protection of our intellectual
property.
WE COULD BECOME SUBJECT TO PRODUCT LIABILITY LAWSUITS
We face a potential risk of product liability claims because our products
may be used in activities where injury may occur such as the building and
construction industries. Although we have product liability insurance coverage,
we cannot be certain that this insurance will adequately protect us against
product liability claims or that we will be able to maintain this insurance at
reasonable cost and on reasonable terms. To the extent that we are found liable
for damages with respect to a product liability claim and lack adequate
insurance coverage to satisfy such claim, our business, operating results, and
financial condition could be materially and adversely affected.
THE JORE FAMILY CONTROLS ALL MATTERS REQUIRING SHAREHOLDER APPROVAL POSSIBLY
IN CONFLICT WITH YOUR INTERESTS
Matthew Jore, acting alone, or the Jore family, acting together, are able to
control all matters requiring shareholder approval. Matthew Jore, President and
Chief Executive Officer, his brother Michael Jore, Executive Vice President,
trusts controlled by Matthew and Michael Jore, and other members of the Jore
family beneficially own approximately 66.2% of our outstanding common stock or
64.3% if the underwriters' overallotment option granted by us in our initial
public offering is exercised in full. Our Articles of Incorporation and Bylaws
do not provide for cumulative voting; therefore, the Jore family will have the
ability to elect all of our directors. The Jore family also will have the
ability to approve or disapprove significant corporate transactions without
further vote by the investors who purchase common stock in this offering. This
ability to exercise control over all matters requiring shareholder approval
could prevent or significantly delay another company or person from acquiring or
merging with us.
WE MAY NEED ADDITIONAL CAPITAL WHICH COULD DILUTE YOUR INTEREST IN US AND
WHICH MAY NOT BE AVAILABLE WHEN NEEDED
We believe that our cash resources, including borrowings under our credit
facilities and cash from operations, and the net proceeds from this offering
will be sufficient to finance our anticipated growth for approximately the next
12 months. However, we may be required to raise additional equity or debt
capital to continue our current levels of operations and to enhance our
financial position for future operations. Financing may be unavailable to us
when needed or, if available, may be on unfavorable terms or may be dilutive to
our shareholders. If financing is unavailable to us or is available only on a
limited basis, we may be unable to develop or enhance our products, take
advantage of business opportunities or respond to competitive pressures, any of
which could have a material adverse effect on our business, operating results,
and financial condition.
WE USE DEBT WHICH CREATES FINANCIAL AND OPERATING RISK
We have relied on debt and may seek additional debt funding in the future.
As of June 30, 1999, we had approximately $18.3 million of outstanding long-term
debt, net of current portion, which accounted for 71.0% of our total
capitalization. Our leverage poses the risks that:
--We may be unable to repay our debt due to a decline in revenues or
disruption in cash flow;
--We may be unable to obtain additional financing;
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--We must dedicate a substantial portion of our cash flow from operations to
servicing the interest and principal payments on our debt, and any remaining
cash flow may be inadequate to fund our planned operations;
--We have pledged substantially all of our inventory and accounts receivable
as collateral; and
--We may be more vulnerable during economic downturns, less able to
withstand competitive pressures and less flexible in responding to changing
business and economic conditions.
ANY FAILURE OF OUR INFORMATION TECHNOLOGY AND COMPUTER CONTROLLED SYSTEMS TO
BE YEAR 2000 COMPLIANT COULD SUBJECT US TO UNFORESEEN EXPENSES
We may not accurately identify all potential Year 2000 problems within our
business, and the corrective measures that we implement may be ineffective or
incomplete. Any such problems could interrupt our ability to manufacture our
products, process orders, accurately report operating and financial data or
service our customers. Similar problems and consequences could result if any of
our key suppliers or customers experience Year 2000 problems. Our failure or the
failure of our significant suppliers and customers to adequately address the
Year 2000 issue could adversely affect our business, operating results and
financial condition.
OUR LOCATION ON PRIVATE PROPERTY WITHIN A NATIVE AMERICAN RESERVATION COULD
SUBJECT US TO UNFORESEEN REGULATION
Our corporate offices and manufacturing facilities are located on private
property within the Flathead Indian Reservation. We may be or become subject to
the jurisdiction of the tribal government or court in any disputes involving any
of the three tribes located on the reservation or their members. In particular,
the tribal government may seek to assert civil regulatory authority over the
conduct of our business under federal laws and treaties under which any of the
tribes, their members, or non-member successors to ownership of land formerly
owned by members of any of the tribes have senior priority. In addition, the
tribal government may have the ability to regulate certain of our activities if
those activities are shown to directly affect any of the tribes, if we enter
into contracts with a tribe or its members, or if a tribe implements laws
governing our business conduct. Currently, the tribal government does not
regulate any of our business activities, however, any regulations that it may
seek to impose could have a material adverse effect on our business, operating
results and financial condition.
FUTURE SALES OF CURRENTLY OUTSTANDING SHARES COULD NEGATIVELY AFFECT OUR
STOCK PRICE
The market price of our common stock could decrease as a result of sales of
a large number of shares in the market after this offering or in response to the
perception that such sales could occur. All of the 3,100,000 under the Plan will
be freely tradable, 4,000,000 shares sold in our initial public offering will
are freely tradable, while the 9,222,800 other shares outstanding after this
offering, based on the number of shares outstanding on August 15, 1999, will be
"restricted securities" as defined in Rule 144 of the Securities Act of 1933. Of
these restricted securities 8,974,903 will be subject to 180-day lock-up
agreements, including the 311,064 shares to be registered in this offering.
After expiration of the lock-up period, all of such shares will be eligible for
immediate sale, in certain instances subject to the volume limitations of Rule
144. D.A. Davidson & Co., co-managing underwriter in our initial public
offering, can release shares from one or more of the lock-up agreements without
our approval.
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CERTAIN PROVISIONS UNDER STATE CORPORATE LAW AND OUR CORPORATE CHARTER COULD
HAVE AN ADVERSE EFFECT ON OUR STOCK PRICE
Certain provisions of our Articles of Incorporation, Bylaws and Montana
corporate law could be used by our incumbent management to make it substantially
more difficult for a third party to acquire control of Jore Corporation. These
provisions could discourage potential takeover attempts and could adversely
affect the market price of our common stock.
POTENTIAL INVESTORS SHOULD NOT RELY ON STATEMENTS MADE IN OUR PRESS RELEASES
WHEN DECIDING WHETHER TO PURCHASE OUR COMMON STOCK
From time to time, we issue press releases concerning our products and
business. In April 1999, for example, we issued a press release announcing a
relationship with Time Domain Corporation. It contained statements regarding our
belief that this relationship will allow us to produce an entirely new
generation of tools. These statements may not be verifiable by third parties and
were based on our internal development efforts and projections based on our
understanding of Time Domain's inventions. As a result, these statements are
subject to potential risks and uncertainties including many of the risks
described in this prospectus. You should not rely on any of the statements from
our press releases when deciding whether to purchase our common stock. Instead,
you should rely only on the information contained in this prospectus when making
an investment decision.
WE HAVE ISSUED WARRANTS IN CONNECTION WITH OUR PRIVATE PLACEMENT THAT MAY BE
DILUTIVE TO NEW INVESTORS
In connection with our private placement of subordinated notes and warrants,
we issued common stock purchase warrants that are exercisable at a price below
the initial public offering price. We issued 367,400 warrants to purchase common
stock at an exercise price of $9.10 and 281,933 warrants to purchase common
stock at an exercise price of $10.00. If the price of our common stock is
greater than the exercise price of the warrants when they are exercised, then
new investors will suffer dilution and the holders of the warrants will obtain
gains.
WE MAY HAVE A CONTINGENT LIABILITY TO INVESTORS IN OUR BRIDGE FINANCING
We may have a contingent liability to investors in the private placement of
our subordinated notes and warrants that closed in August 1999. If these
investors were to pursue an action against us for conducting a private placement
that allegedly violated applicable securities law, we could be required to repay
approximately $1.75 million in principal, plus interest thereon, in addition to
the approximately $12.7 million in principal amount of notes that we expect to
repay with the proceeds of this offering.
REGISTERED STOCKHOLDERS
The following table sets forth information with respect to the beneficial
ownership of Registered Stockholders based upon the corporate records of Jore as
of October 4, 1999. Beneficial ownership is determined in accordance with the
rules of the Commission, is based upon 13,222,800 shares outstanding as of
October 4, 1999 and generally includes voting or investment power with respect
to securities. Shares of common stock options or warrants that are currently
exercisable or exercisable within 60 days of October 4, 1999 are deemed to be
outstanding and to be beneficially owned by the person holding such options for
the purpose of computing the percentage ownership of such person but are not
treated as outstanding for the purpose of computing the percentage ownership of
any other person.
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The inclusion in the table of the individuals named therein shall not be
deemed to be an admission that any such individuals are "affiliates" of Jore.
<TABLE>
<CAPTION>
POSITION WITH NUMBER OF PERCENTAGE OF
THE NUMBER OF SHARES PERCENTAGE OF SHARES SHARES TO BE SHARES OWNED
REGISTERED STOCKHOLDER COMPANY BENEFICIALLY OWNED BENEFICIALLY OWNED OFFERED HEREBY AFTER OFFERING
- ------------------------ --------------- ------------------- ----------------------- --------------- -------------------
<S> <C> <C> <C> <C> <C>
The Steele Family Trust,
by William M. Steele
as trustee............ Director and 155,532 1.2% 155,532 0%
Consultant
Gary S. Houck........... Consultant 155,532 1.2% 155,532 0%
</TABLE>
PLAN OF DISTRIBUTION
The shares of Common Stock covered by this Reoffer Prospectus are being
registered by Jore for the account of the Registered Stockholders.
The Registered Stockholders may sell the shares in one or more transactions
(which may involve one or more block transactions) on the Nasdaq National
Market, in sales occurring in the public market off such system, in privately
negotiated transactions or in a combination of such transactions. Each such sale
may be made either at market prices prevailing at the time of such sale or at
negotiated prices. The Registered Stockholders may sell some or all of the
shares in transactions involving broker-dealers, who may act as agent or acquire
the shares as principal. Any broker-dealer participating in such transactions as
agent may receive commissions from the Registered Stockholder (and, if they act
as agent for the purchaser of such shares, from such purchaser). The Registered
Stockholders will pay usual and customary brokerage fees. Broker-dealers may
agree with the Registered Stockholders to sell a specified number of shares at a
stipulated price per share and, to the extent such a broker-dealer is unable to
do so acting as agent for the Registered Stockholders, to purchase as principals
any unsold shares at the price required to fulfill the respective
broker-dealer's commitment to the Registered Stockholders. Broker-dealers who
acquire shares as principals may thereafter resell such shares from time to time
in transactions (which may involve cross and block transactions and which may
involve sales to and through other broker-dealers, including transactions of the
nature described above) in the over-the-counter market, negotiated transactions
or otherwise, at market prices prevailing at the time of sale or at negotiated
prices, and in connection with such resales may pay to or receive from the
purchasers of such shares commissions.
To the knowledge of the Company, there is currently no agreement with any
broker or dealer respecting the sale of the shares offered hereby. In addition,
the shares are subject to a Lock Up Agreement with the underwriters of our
initial public offering and may not be resold until March 27, 2000, unless the
Lock Up Agreement is released earlier. Upon the sale of any such shares, the
Registered Stockholders or anyone effecting sales on behalf of the Registered
Stockholders may be deemed an underwriter, as that term is defined under the
Securities Act of 1933, as amended. We will pay all expenses of preparing and
reproducing this Reoffer Prospectus, but will not receive the proceeds from
sales by the Registered Stockholders. Sales will be made at prices prevailing at
the time of such sales.
The Company is bearing all costs relating to the registration of the shares.
Any commissions or other fees payable to broker-dealers in connection with any
sale of the shares will be borne by the Registered Stockholders or other party
selling such shares. In order to comply with certain states' securities laws, if
applicable, the shares will be sold in such jurisdictions only through
registered or licensed brokers or dealers. In certain states the shares may not
be sold unless the shares have been registered or qualified for sale in such
state, or unless an exemption form registration or qualification is available
and is obtained.
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USE OF PROCEEDS
Jore will not receive any of the proceeds from the offering hereunder. All
expenses of registration incurred in connection with this offering are being
borne by Jore, but all selling and other expenses incurred by the Registered
Stockholders will be borne by such Registered Stockholders.
DOCUMENTS INCORPORATED BY REFERENCE
Jore hereby incorporates by reference into this Registration Statement the
following documents previously filed with the Securities and Exchange Commission
(the "SEC"):
(a) The Company's prospectus filed with the SEC pursuant to Rule 424(b) of
the Securities Act of 1933, as amended (the "1933 Act"), in connection
with the Registration Statement No. 333-78357 on Form S-1 filed with the
SEC on September 23, 1999, together with any and all amendments thereto,
in which there is set forth audited financial statements for each of the
three years in the period ended December 31, 1998; and
(b) The Company's Registration Statement No. 000-26889 on Form 8-A filed
with the SEC on July 30, 1999, together with all amendments thereto,
pursuant to Section 12 of the Securities Exchange Act of 1934, as amended
(the "1934 Act") in which there is described the terms, rights and
provisions applicable to the Company's outstanding Common Stock.
All reports and definitive proxy or information statements filed pursuant to
Section 13(a), 13(c), 14 or 15(d) of the 1934 Act after the date of this
Registration Statement and prior to the filing of a post-effective amendment
which indicates that all securities offered hereby have been sold or which
deregisters all securities then remaining unsold shall be deemed to be
incorporated by reference into this Registration Statement and to be a part
hereof from the date of filing of such documents.
INDEMNIFICATION
In accordance with Montana law our Amended and Restated Articles of
Incorporation include a provision that eliminates the personal liability of our
directors to Jore Corporation for monetary damages arising from breach of
fiduciary duty as directors, except for liability relating to:
--acts or omissions that involve intentional misconduct or a knowing
violation of law;
--unlawful distributions; or
--any transaction from which the director derived an improper personal
benefit.
In addition, our Bylaws provide that:
--We must indemnify our directors and officers to the fullest extent
permitted by Montana law, subject to certain exceptions;
--We may indemnify our other employees and agents to the same extent that we
indemnify our officers and directors, unless otherwise required by law, our
Amended and Restated Articles of Incorporation, our Bylaws or agreements; and
--We must advance expenses, as incurred, to our directors and officers in
connection with legal proceedings to the fullest extent permitted by Montana
law.
We have entered into indemnity agreements with each of our directors and
executive officers to give them additional contractual assurances regarding the
scope of the indemnification described above and to provide additional
procedural protections. In addition, we intend to obtain directors' and
officers' insurance providing indemnification for our directors, officers and
certain employees for certain liabilities. We believe that these indemnification
provisions and agreements are necessary to attract and retain qualified
directors and officers. Insofar as indemnification for liabilities arising under
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the Securities Act may be permitted to directors, officers or persons
controlling Jore Corporation, we have been informed that, in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy and is therefore unenforceable.
The limitation of liability and indemnification provisions in our Amended
and Restated Articles of Incorporation and Bylaws may discourage shareholders
from bringing a lawsuit against directors for breach of their fiduciary duty.
These provisions also may diminish the likelihood of derivative litigation
against our directors and officers, even though such an action, if successful,
might otherwise benefit us and our shareholders. Furthermore, a shareholder's
investment may be adversely affected to the extent that we pay the costs of
settlement and damage awards against directors and officers pursuant to these
indemnification provisions.
At present, there is no pending litigation or proceeding involving any of
our directors, officers or employees for which indemnification is sought, nor
are we aware of any threatened litigation that may result in claims for
indemnification.
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PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed by Jore Corporation, a Montana corporation
(the "Company" or the "Registrant") with the Securities and Exchange Commission
(the "Commission") are incorporated by reference into this Registration
Statement:
(a) The Company's Registration Statement on Form S-1 (No. 333-78357) and
the prospectus filed with the Commission pursuant to Rule 424(b) under the
Securities Act, that contain audited financial statements for each of three
years in the period ended December 31, 1998; and
(b) A description of the Company's Common Stock, which is contained in
the Form 8-A Registration Statement (No. 000-26889) filed by the Company
with the Commission on July 30, 1999.
In addition, all reports and other documents subsequently filed by the
Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act
prior to the filing of a post effective amendment which indicates that all
securities offered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference herein and to
be a part of this Registration Statement from the date of the filing of such
reports and documents.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Montana Business Corporation Act provides that a director or officer of
a corporation (i) shall, unless limited by the Articles of Incorporation, be
indemnified by the corporation for expenses in defense of any action or
proceeding if the director or officer is sued by reason of his service to the
corporation, to the extent that such person has been successful in defense of
such action or proceeding and (ii) may be indemnified by the corporation for
expenses, judgments, fines, penalties and amounts paid in settlement of a
proceeding, even if he is not successful on the merits, if he acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the corporation (and in a criminal proceeding, if he did not have
reasonable cause to believe his conduct was unlawful), provided that no
indemnification is permitted without court approval if the director or officer
was adjudged liable to the corporation. The Registrant's Articles of
Incorporation do not limit the Registrant's obligation to indemnify its
directors and officers.
The Registrant's Articles of Incorporation limit the liability of its directors
as permitted by the Montana Business Corporation Act. Specifically, directors of
the Registrant will not be personally liable for monetary damages for any action
taken or any failure to take any action as a director, except for (i) the amount
of financial benefit received by a director to which a director is not entitled,
(ii) an intentional infliction of harm on the corporation or its shareholders,
(iii) an unlawful distribution to shareholders or (iv) an intentional violation
of criminal law.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
II-1
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ITEM 8. EXHIBITS
The following is a complete list of Exhibits filed as part of this
Registration Statement and which are incorporated herein:
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ------------- -----------------------------------------------------------------------------------------------------
<C> <S>
4.1 Amended and Restated Articles of Incorporation (Filed as Exhibit 3.1 to the Company's Registration
Statement on Form S-1 (No. 333-78357) and incorporated herein by reference)
4.2 Bylaws (Filed as Exhibit 3.2 to the Company's Registration Statement on Form S-1 (No. 333-78357) and
incorporated herein by reference)
4.3 Form of Common Stock Certificate (Filed as Exhibit 4.3 to the Company's Registration Statement on
Form S-1 (No. 333-78357) and incorporated herein by reference)
4.4 Amended And Restated Jore Corporation 1997 Stock Option Plan (Filed as Exhibit 10.1 to the Company's
Registration Statement on Form S-1 (No. 333-78357) and incorporated herein by reference)
5.1 Opinion of Van Valkenberg Furber Law Group P.L.L.C. as to legality of shares to be issued.
23.1 Consent of Van Valkenberg Furber Law Group P.L.L.C. (Included in Exhibit 5.1).
23.2 Consent of Deloitte & Touche L.L.P., independent certified public accountants for the Company.
24.1 Power of Attorney (Included in the signature page to this Registration Statement).
99.1 Common Stock Purchase Option, dated February 10, 1999, between Jore Corporation and William M.
Steele, as trustee for The Steele Family Trust (Filed as Exhibit 10.2 to the Company's Registration
Statement on Form S-1 (No. 333-78357) and incorporated herein by reference)
99.2 Common Stock Purchase Option, dated February 10, 1999, between Jore Corporation and Gary S. Houck
(Filed as Exhibit 10.3 to the Company's Registration Statement on Form S-1 (No. 333-78357) and
incorporated herein by reference)
</TABLE>
ITEM 9. UNDERTAKINGS
A. The Registrant hereby undertakes:
(1) To file, during any period in which offers or sells are being made,
a post-effective amendment to this Registration Statement to:
(i) include any prospectus required by section 10(a)(3) of the
Securities Act;
(ii) 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 together,
represent a fundamental change in the information 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% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the
effective registration statement; and
(iii) 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.
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PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) do not apply if the
Registration Statement is on Form S-3 or Form S-8, and 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 Section 15(d) of the Exchange Act that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement of the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof; and
(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 purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities being offered herein, 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 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the 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 the 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 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-3
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Ronan, State of Montana, on the 13th day of October
1999.
<TABLE>
<S> <C> <C>
JORE CORPORATION
By: /s/ MATTHEW B. JORE
-----------------------------------------
Matthew B. Jore
PRESIDENT AND CHIEF EXECUTIVE OFFICER
</TABLE>
POWER OF ATTORNEY
Each person whose individual signature appears below hereby authorizes and
appoints Matthew B. Jore and David H. Bjornson, or either of them, with full
power of substitution and full power to act without the other, as his true and
lawful attorney-in-fact and agent to act in his name, place and stead and to
execute in the name and on behalf of each person, individually and in each
capacity stated below, and to file, any and all amendments to this Registration
Statement, including any and all post-effective amendments with the Securities
and Exchange Commission or any regulatory authority.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities indicated below on the 13th day of October, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------ --------------------------
<C> <S>
Chairman, President and
/s/ MATTHEW B. JORE Chief Executive Officer
- ------------------------------ (Principal Executive
Matthew B. Jore Officer)
Chief Financial Officer
/s/ DAVID H. BJORNSON and Director (Principal
- ------------------------------ Financial and Accounting
David H. Bjornson Officer)
/s/ MICHAEL W. JORE
- ------------------------------ Executive Vice President
Michael W. Jore and Director
/s/ THOMAS E. MAHONEY
- ------------------------------ Director
Thomas E. Mahoney
/s/ R. BRUCE ROMFO
- ------------------------------ Director
R. Bruce Romfo
/s/ WILLIAM M. STEELE
- ------------------------------ Director
William M. Steele
/s/ JAMES P. MATHIAS
- ------------------------------ Director
James P. Mathias
/s/ A. BLAINE HUNTSMAN
- ------------------------------ Director
A. Blaine Huntsman
</TABLE>
II-4
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ------------- -----------------------------------------------------------------------------------------------------
<C> <S>
4.1 Amended and Restated Articles of Incorporation (Filed as Exhibit 3.1 to the Company's Registration
Statement on Form S-1 (No. 333-78357) and incorporated herein by reference)
4.2 Bylaws (Filed as Exhibit 3.2 to the Company's Registration Statement on Form S-1 (No. 333-78357) and
incorporated herein by reference)
4.3 Form of Common Stock Certificate (Filed as Exhibit 4.3 to the Company's Registration Statement on
Form S-1 (No. 333-78357) and incorporated herein by reference)
4.4 Amended And Restated Jore Corporation 1997 Stock Option Plan (Filed as Exhibit 10.1 to the Company's
Registration Statement on Form S-1 (No. 333-78357) and incorporated herein by reference)
5.1 Opinion of Van Valkenberg Furber Law Group P.L.L.C. as to legality of shares to be issued.
23.1 Consent of Van Valkenberg Furber Law Group P.L.L.C. (Included in Exhibit 5.1).
23.2 Consent of Deloitte & Touche L.L.P., independent certified public accountants for the Company.
24.1 Power of Attorney (Included in the signature page to this Registration Statement).
99.1 Common Stock Purchase Option, dated February 10, 1999, between Jore Corporation and William M.
Steele, as trustee for The Steele Family Trust (Filed as Exhibit 10.2 to the Company's Registration
Statement on Form S-1 (No. 333-78357) and incorporated herein by reference)
99.2 Common Stock Purchase Option, dated February 10, 1999, between Jore Corporation and Gary S. Houck
(Filed as Exhibit 10.3 to the Company's Registration Statement on Form S-1 (No. 333-78357) and
incorporated herein by reference)
</TABLE>
<PAGE>
EXHIBIT 5.1
[VAN VALKENBERG FURBER LAW GROUP P.L.L.C. LETTERHEAD]
October 13, 1999
Jore Corporation
45000 Highway 93 South
Ronan, Montana 59864
Ladies and Gentlemen:
We have acted as counsel to Jore Corporation, a Montana corporation (the
"Company"), in connection with the preparation and filing of a registration
statement on Form S-8 (the "Registration Statement") under the Securities Act of
1933, as amended (the "Securities Act"), being filed by the Company with the
Securities and Exchange Commission with respect to the issuance by the Company
of up to 1,300,000 shares (the "Plan Shares") of the Company's common stock,
without par value per share, that may be issuable under the Amended and Restated
Jore Corporation 1997 Stock Plan (the "Plan"), 155,532 shares (the "Steele
Shares") that may be acquired by William M. Steele, as trustee of the Steele
Family Trust under the Common Stock Purchase Option, dated February 10, 1999,
between Jore Corporation and William M. Steele, as trustee for The Steele Family
Trust (the "Steele Option") and 155,532 shares (the "Houck Shares") that may be
acquired by Gary S. Houck under the Common Stock Purchase Option, dated February
10, 1999, between Jore Corporation and Gary S. Houck (the "Houck Option"). The
Plan Shares, the Steele Shares and the Houck Shares are collectively referred to
herein as the "Shares".
We have examined the Registration Statement and such documents and records
of the Company and other documents as we have deemed necessary for the purpose
of this opinion. In our examination of the foregoing documents, we have assumed
the genuineness of all signatures and the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as copies and the authenticity of the originals of
such latter documents. Based upon and subject to the foregoing, we are of the
opinion that upon the happening of the following events:
(a) the filing and effectiveness of the Registration Statement and any
amendments thereto;
(b) registration by the Company's registrar of the Shares;
(d) the issuance and sale of the Shares in accordance with the terms of the
Plan, the Steele Option or the Houck Option, respectively; and
(e) receipt by the Company of the consideration required for the Shares in
accordance with the terms of the Plan, the Steele Option or the Houck
Option, respectively;
the Shares will be duly authorized, validly issued, fully paid and
nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving such consent, we do not thereby admit that we
are in the category of persons whose consent is required under Section 7 of the
Securities Act.
This opinion is based upon currently existing statutes, rules, regulations
and judicial decisions, and we disclaim any obligation to advise you of any
change in any of these sources of law or subsequent legal or factual
developments which might affect any matters or opinions set forth herein.
Please note that we are opining only as to the matters expressly set forth
herein, and no opinion should be inferred as to any other matters.
Very truly yours,
/s/ Van Valkenberg Furber Law Group
P.L.L.C.
<PAGE>
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
To the Board of Directors and Stockholders of
Jore Corporation
Ronan, Montana
We consent to the incorporation by reference in this Registration Statement
of Jore Corporation on Form S-8 of our report dated May 12, 1999 (August 19,
1999 as to Note 11) on the consolidated financial statements of Jore Corporation
and subsidiaries appearing in the Prospectus filed pursuant to Rule 424(b) under
the Securities Act of 1933 that relates to Amendment No. 5 to Registration
Statement No. 333-78357 of Jore Corporation on Form S-1.
/s/ DELOITTE & TOUCHE LLP
Seattle, Washington
October 13, 1999
