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FILED PURSUANT TO RULE 424(b)(3)
REGISTRATION NO. 333-53413
PROSPECTUS SUPPLEMENT
Supplement No. 1 Dated October 23, 1998
to Prospectus Dated July 21, 1998
Relating to
Action Performance Companies, Inc.
$100,000,000
4-3/4% Convertible Subordinated Notes Due 2005
and Shares of Common Stock
Issuable Upon Conversion Thereof
All capitalized terms used but not defined in this Prospectus
Supplement ("Supplement") shall have the meanings set forth in the Prospectus
dated July 21, 1998 (the "Prospectus") forming a part of the Registration
Statement on Form S-3 (Registration No. 333-53413). Any cross references in this
Supplement refer to portions of the Prospectus.
The purpose of this Supplement is to provide additional information
regarding the Selling Securityholders. In addition to the Selling
Securityholders named in the Prospectus, the following table sets forth (i) the
name of each additional Selling Securityholder, (ii) the amount of Notes
beneficially owned by each such additional Selling Securityholder as of October
19, 1998 (assuming no Notes have been sold under the Prospectus as of such date)
that may be offered for the account of such additional Selling Securityholder
under the Prospectus, and (iii) the number of Conversion Shares beneficially
owned by each such additional Selling Securityholder as of October 19, 1998,
that may be offered for the account of such additional Selling Securityholder
under the Prospectus. Such information was obtained from the Selling
Securityholders but has not been independently verified by the Company. Except
as otherwise indicated below, none of the Selling Securityholders listed below
had any material relationship with the Company, other than as a result of
ownership of the Notes, within the three-year period ending on the date of this
Supplement.
<TABLE>
<CAPTION>
Principal Percentage of Number of
Amount of Total Conversion Percentage of
Name of Notes That Notes Shares That Common Stock
Selling Securityholder May Be Sold Outstanding May Be Sold(1) Outstanding(2)
---------------------- ----------- ----------- -------------- --------------
<S> <C> <C> <C>
MainStay Convertible Fund........... $4,000,000 4.0% 82,987 *
Fidelity Commonwealth Trust:
Fidelity Small Cap
Stock Fund..................... 3,375,000 3.4% 70,020 *
Deutsche Bank A.G. London(3)........ 2,500,000 2.5% 51,867 *
NationsBanc Montgomery
Securities LLC(4).............. 2,245,000 2.2% 46,576 *
General Motors Employees
Domestic Group Trust(5)........ 1,577,000 1.6% 32,717 *
Motors Insurance Corporation(6)..... 382,000 * 7,925 *
General Motors Foundation(7)........ 41,000 * 850 *
</TABLE>
- ----------------------------
* Less than 1%
(1) Assumes conversion of the full amount of Notes held by such Selling
Securityholder into Common Stock at the initial conversion price of $48.20
per share. Except as otherwise indicated, also assumes that the Selling
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Securityholder or any future transferees, pledgees, donees or successors of
or from such Selling Securityholder do not beneficially own any Common
Stock other than the Common Stock issuable upon conversion of the Notes.
The conversion price and the number of shares of Common Stock issuable upon
conversion of the Notes are subject to adjustment under certain
circumstances. Accordingly, the number of shares of Common Stock issuable
upon conversion of the Notes may increase or decrease from time to time.
Under the terms of the Indenture, the Company will pay cash in lieu of
issuing fractional shares upon conversion of the Notes. See "Description of
Notes -- Conversion Rights."
(2) Calculated based upon 16,423,238 shares of Common Stock outstanding as of
October 21, 1998. In calculating the percentage of ownership, all shares of
Common Stock that the identified person had the right to acquire upon
conversion of such persons' Notes are deemed to be outstanding for the
purpose of computing the percentage of the shares of Common Stock owned by
such person, but are not deemed to be outstanding for the purpose of
computing the percentage of the shares of Common Stock owned by any other
person.
(3) Represents Notes purchased by the Selling Securityholder subsequent to the
date of the Prospectus. The Selling Securityholder previously sold Notes in
the aggregate principal amount of $2,500,000 pursuant to the Prospectus.
(4) Represents Notes purchased by NationsBanc Montgomery Securities LLC
subsequent to the date of the Prospectus. NationsBanc Montgomery Securities
LLC previously sold Notes in the aggregate principal amount of $5,815,000
pursuant to the Prospectus. As of October 19, 1998, NationsBanc Montgomery
Securities LLC owned Notes in the aggregate principal amount of $3,000,000,
all of which may be sold under the Prospectus and this Supplement.
NationsBanc Montgomery Securities LLC acted as the lead underwriter in the
Company's secondary public offering of Common Stock in June 1997 and as an
Initial Purchaser in the March 1998 private placement of the Note.
(5) Represents Notes purchased by the Selling Securityholder subsequent to the
date of the Prospectus. As of October 19, 1998, such Selling Securityholder
owned Notes in the aggregate principal amount of $13,277,000, all of which
may be sold under the Prospectus and this Supplement. The Selling
Securityholder holds an additional $12,481,000 in principal amount of Notes
that it purchased from other Selling Securityholders pursuant to the
Prospectus. The Selling Securityholder may transfer such additional Notes
without further registration under the Securities Act.
(6) Represents Notes purchased by the Selling Securityholder subsequent to the
date of the Prospectus. As of October 19, 1998, such Selling Securityholder
owned Notes in the aggregate principal amount of $3,247,000, all of which
may be sold under the Prospectus and this Supplement. The Selling
Securityholder holds an additional $3,056,000 in principal amount of Notes
that it purchased from other Selling Securityholders pursuant to the
Prospectus. The Selling Securityholder may transfer such additional Notes
without further registration under the Securities Act.
(7) Represents Notes purchased by the Selling Securityholder subsequent to the
date of the Prospectus. As of October 19, 1998, the Selling Securityholder
owned Notes in the aggregate principal amount of $476,000, all of which may
be sold under the Prospectus and this Supplement. The Selling
Securityholder holds an additional $463,000 in principal amount of Notes
that it purchased from other Selling Securityholders pursuant to the
Prospectus. The Selling Securityholder may transfer such additional Notes
without further registration under the Securities Act.
The Selling Securityholders may, pursuant to the Prospectus and this
Supplement, offer all or some portion of the Notes and Conversion Shares they
presently hold or, with respect to the Conversion Shares, have the right to
acquire upon conversion of such Notes. Although each of the Selling
Securityholders is assumed to be selling all of the Notes or Conversion Shares
beneficially owned by such person, no estimate can be given as to the amount of
the Notes and Common Stock that will be held by the Selling Securityholders upon
termination of any such sales. In addition, since the date on which they
provided the information regarding their Notes and Conversion Shares, the
Selling Securityholders identified above may have sold, transferred or otherwise
disposed of all or a portion of their
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Notes and Conversion Shares in transactions exempt from the registration
requirements of the Securities Act. See "Plan of Distribution."
Only those Selling Securityholders identified above and in the
Prospectus who beneficially own the Notes and Conversion Shares set forth
opposite each such Selling Securityholder's name may sell such Notes and
Conversion Shares pursuant to the Prospectus and this Supplement. The Company
may from time to time, in accordance with the Registration Rights Agreement,
include additional Selling Securityholders in additional supplements to the
Prospectus.
