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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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BALLANTYNE OF OMAHA, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 47-0587703
(State or other (I.R.S. Employer
jurisdiction of Identification
incorporation or Number)
organization)
</TABLE>
4350 MCKINLEY STREET, OMAHA, NE. 68112
(402) 453-4444
(Address, including zip code and telephone number, including
area code, of registrant's principal executive offices)
STEPHEN E. GEHRING,
1125 S. 103RD ST., STE. 720,
OMAHA, NE. 68124
(402) 397-1700
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
AS SOON AS PRACTICABLE AFTER THE EFFECTIVE DATE HEREOF.
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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
reinvestment plans, check the following box: /X/
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 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 the earlier
effective registration statement for the same offering. / /
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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. / /
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If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box: / /
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO OFFERING PRICE AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED BE REGISTERED PER UNIT OFFERING PRICE REGISTRATION FEE
<S> <C> <C> <C> <C>
Common Stock.......................... 323,400(1) $14.83(4) $4,796,022.00 $1,453.19
Common Stock.......................... 82,500(2) $14.83(4) $1,223,475.00 $370.71
Common Stock.......................... 41,250(3) $14.83(4) $611,737.50 $185.36
Total................................. 447,150 $14.83 $6,631,234.50 $2,009.26
</TABLE>
(1) Represents shares of Common Stock issuable upon exercise of Merita Bank Ltd
Warrant.
(2) Represents shares of Common Stock issuable upon exercise of an option
granted to Geller & Friend Capital Partners, Inc. in conjunction with
certain services being provided to the Company.
(3) Represents shares of Common Stock issuable upon exercise of an option
granted to Jaffoni & Collins, Inc. in conjunction with certain services
being provided to the Company.
(4) Estimated pursuant to Rule 457 of the Securities Act of 1933, as amended
(the "Act") solely for the purpose of calculating the registration fee. The
price is based upon the average of the high and low prices of Ballantyne of
Omaha, Inc. Common Stock on February 21, 1997 as reported on the American
Stock Exchange, ($22.25) adjusted to reflect a 3 for 2 stock split effected
as a 50% stock dividend on March 5, 1997 to Stockholders of record on
February 10, 1997 ($14.83).
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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 BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE OR DATES AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A) MAY DETERMINE.
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PROSPECTUS
BALLANTYNE OF OMAHA, INC.
This Prospectus relates to the offering by Merita Bank Ltd ("Merita" or
"Selling Stockholder") of 323,400 shares of common stock of Ballantyne of Omaha,
Inc. (the "Company"), par value $0.01 (the "Common Stock"), issuable upon
exercise of the outstanding warrant (the "Merita Warrant") that was issued to
Merita as partial consideration for providing certain financial assistance in
connection with the Company's acquisition of Cinema Products Division of ORC.
The outstanding Merita Warrant is immediately exercisable, in whole or in part,
and entitles the holder to purchase 323,400 shares of Common Stock at a price of
$3.94 per share at any time through September 12, 2000. At February 21, 1997,
the Merita Warrant had not been exercised in whole or in part and accordingly,
none of the Common Stock underlying the Merita Warrant had been issued. The
exercise price of the Merita Warrant and the number of securities issuable upon
exercise of the Warrant have been adjusted and are subject to further adjustment
as a result of the application of certain anti-dilution provisions contained
therein. All share amounts in this Prospectus have been adjusted to reflect a 3
for 2 stock split effected as a 50% stock dividend on March 5, 1997 to
Stockholders of record on February 10, 1997.
This Prospectus also relates to the offering by Geller & Friend Capital
Partners, Inc. ("GFCP" or the "Selling Stockholder"), of an aggregate of 82,500
shares of Common Stock issuable upon the exercise of an option (the "GFCP
Option") in connection with the advisory services being provided by GFCP to the
Company. The outstanding GFCP Option is immediately exercisable, in whole or in
part, and entitles the holder thereof to purchase 82,500 shares of Common Stock
of the Company at an exercise price of $4.39 per share. At February 21, 1997,
the GFCP Option had not been exercised in whole or in part and accordingly, none
of the Common Stock underlying the GFCP Option had been issued. The exercise
price of the GFCP Option and the number of securities issuable upon exercise of
the GFCP Option have been adjusted and are subject to further adjustment as a
result of the application of certain anti-dilution provisions contained therein.
This Prospectus also relates to the offering by Jaffoni & Collins, Inc.
("Jaffoni" or the "Selling Stockholder"), of an aggregate of 41,250 shares of
Common Stock issuable upon the exercise of an option (the "Jaffoni Option") in
connection with services being provided by Jaffoni to the Company. The
outstanding Jaffoni Option is immediately exercisable, in whole or in part, and
entitles the holder thereof to purchase 41,250 shares of Common Stock of the
Company at an exercise price of $4.24 per share. At February 21, 1997, the
Jaffoni Option had not been exercised in whole or in part and accordingly, none
of the Common Stock underlying the Jaffoni Option had been issued. The exercise
price of the Jaffoni Option and the number of securities issuable upon exercise
of the Jaffoni Option have been adjusted and are subject to further adjustment
as a result of the application of certain anti-dilution provisions contained
therein. Throughout this Prospectus, Merita, GFCP and Jaffoni will be
collectively referred to as the "Selling Stockholders".
The Common Stock of the Company is listed on the American Stock Exchange
("AMEX") under the symbol "BTN". On February 21, 1997, the last reported sale
price of the Common Stock as quoted on AMEX was $22.25 per share.
The Company will not receive any of the proceeds from the sale of the shares
of Common Stock being registered by the Selling Stockholders. The Company will
receive approximately $1,802,162 in net proceeds if the Merita Warrant, GFCP
Option and Jaffoni Option are exercised in whole. See "Use of Proceeds".
All expenses of the registration of securities covered by this Prospectus,
estimated to be approximately $9,109, are to be borne by the Company.
THE SECURITIES OFFERED HEREBY ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF
RISK. SEE "RISK FACTORS", BEGINNING ON PAGE 3 OF THIS PROSPECTUS.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
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THE DATE OF THIS PROSPECTUS IS MARCH , 1997.
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AVAILABLE INFORMATION
The Company is subject to the information requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") and in accordance
therewith, files reports and other information with the Securities and Exchange
Commission (the "Commission"). Proxy statements, reports and other information
concerning the Company can be inspected and copied at Room 1024 of the
Commission's office at 450 Fifth Street, N.W., Washington, D.C. 20549, and the
Commission's Regional Offices in New York (Room 1228, 75 Park Place, New York,
New York 10007), and Chicago (Suite 1400, Northwestern Atrium Center, 500 West
Madison Street, Chicago, Illinois 60621-2511), and copies of such material can
be obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549, at prescribed rates. The Commission
maintains a Web site that contains reports, proxy and information statements and
other materials that are filed through the Commission's Electronic Data
Gathering Analysis and Retrieval (EDGAR) System. This Web site can be accessed
at http:\\www.sec.gov. This Prospectus does not contain all information set
forth in the Registration Statement of which this Prospectus forms a part and
exhibits thereto which the Company has filed with the Commission under the
Securities Act of 1933, as amended (the "Securities Act") and to which reference
is hereby made.
DOCUMENTS INCORPORATED BY REFERENCE
The Company has provided, without charge, to each recordholder of the Merita
Warrant, GFCP Option, and the Jaffoni Option a copy of the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1995. The Company
will also provide, without charge, to each person to whom a copy of this
Prospectus is delivered, upon the written or oral request of such person, a copy
of any or all of the other documents incorporated by reference herein (other
than exhibits to such documents, unless such exhibits are specifically
incorporated by reference into the information that the Prospectus
incorporates). Requests should be directed to:
Ballantyne of Omaha, Inc.
4350 McKinley Street
Omaha, Nebraska 68112
Attention: Brad French, Chief Financial Officer
Phone: (402) 453-4444
The following documents filed with the Commission by the Company are hereby
incorporated by reference into this Prospectus:
(1) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995;
(2) The Company's Quarterly Reports on Form 10-Q for the quarters ended
March 31, June 30 and September 30, 1996;
(3) Certificate of Incorporation, as amended (incorporated by reference to
Exhibit 3.1 and 3.3 to the Registration statement on Form S-1 (File No.
33-93244)).
All documents filed with the Commission by the Company pursuant to Sections
13(a), 13(c), 14, or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of the offering registered hereby shall
be deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the date of the filing of such documents. Any statement contained in
a document incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any subsequently filed document
which also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Such statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of this
Prospectus.
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RISK FACTORS
IN ADDITION TO THE OTHER INFORMATION IN THIS PROSPECTUS, THE FOLLOWING RISK
FACTORS SHOULD BE CONSIDERED CAREFULLY IN EVALUATING AN INVESTMENT IN THE
COMPANY BEFORE PURCHASING THE SHARES OF COMMON STOCK OFFERED HEREBY.
DEPENDENCE ON MOTION PICTURE SCREEN GROWTH
Because the Company's commercial motion picture projectors have an estimated
useful life of approximately 20 years, the Company's net sales and profitability
are dependent primarily upon growth in the number of motion picture screens and
the renovation and replacement of commercial motion picture projection equipment
in existing theatres. For the years ended December 31, 1993, 1994 and 1995,
approximately 77%, 80% and 87%, respectively, of the Company's net sales were
derived from sales of its commercial motion picture projection equipment.
Although industry analysts foresee growth in the number of motion picture
screens as a result of the trend toward multiplexing and megaplexing and the
introduction of new forms of motion picture-based entertainment, there can be no
assurance that this expectation will prove accurate. In addition, growth in the
number of new motion picture screens may be adversely affected by the
availability of home entertainment delivery systems. A lack of an increase in
motion picture screen growth would have a material adverse effect upon the
Company's results of operations.
COMPETITION
The market for commercial motion picture projection equipment is highly
competitive. In the international market, where the Company has a smaller market
share than in the domestic market, the Company believes that its largest
competitor has significantly greater market share than the Company. In addition
to existing commercial motion picture projection equipment manufacturers, the
Company may also encounter competition from new competitors, as well as from new
types of equipment. No assurance can be given that the commercial motion picture
projection equipment manufactured by the Company will not become obsolete as
technology advances. In addition, the markets for the Company's long-range
follow spotlight and restaurant products are highly competitive. Competitors of
the Company may also have significantly greater financial resources than the
Company which may impede the ability of the Company to compete effectively.
DEPENDENCE ON KEY MANAGEMENT
The Company's success depends, in substantial part, on the efforts and
abilities of John Wilmers, the Company's President and Chief Executive Officer.
Mr. Wilmers' employment contract expires on December 31, 2001. Failure to retain
the services of Mr. Wilmers could have a material adverse effect on the Company.
The Company does not maintain key man life insurance on the life of Mr. Wilmers.
UNCERTAINTIES REGARDING INTERNATIONAL SALES
For the years ended December 31, 1993, 1994 and 1995, the Company generated
net sales to foreign customers of approximately $4.6 million, $6.4 million, and
$11.3 million, respectively, which accounted for approximately 20%, 22% and 29%
of the Company's total net sales for such years, respectively. These amounts do
not include sales to domestic export dealers and domestic theatre chains of
products which are ultimately exported. The Company expects that international
sales will continue to account for a substantial portion of its revenues.
International sales may be subject to political and economic risks, including
political instability, currency controls, fluctuating exchange rates with
respect to sales not denominated in U.S. dollars and changes in import/export
regulations, tariffs and freight rates. To date, all of the Company's
international sales have been denominated in U.S. dollars, exclusive of Westrex
net sales (approximately $2.9 million in 1995) which are denominated in Hong
Kong dollars. A weakening in the
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value of foreign currencies relative to the U.S. dollar could have an adverse
impact on the Company by increasing the effective price of the Company's
products in its international markets. In addition, there can be no assurance
that the Company's international customers will continue to accept orders
denominated in U.S. dollars. To the extent that orders are denominated in
foreign currencies, the Company's reported sales and earnings are more directly
subject to foreign exchange fluctuation. There can be no assurance that these
factors will not adversely affect the Company's international sales in the
future.
LIMITED SOURCE FOR CERTAIN COMPONENTS
The Company does not manufacture certain of its components, including film
platters, lenses and intermittent movement components for its commercial motion
picture projection equipment and the aluminum kettles for its pressure fryers.
Each such component is sourced by the Company from a single contract
manufacturer. Although to date the Company has not experienced any significant
difficulty in obtaining these components, there can be no assurance that
shortages will not arise in the future. The loss of any one or more suppliers of
any such components would have an adverse effect on the Company's business until
alternative supplies could be secured.
CONTROL BY MAJORITY STOCKHOLDER
ARC International Corporation ("ARC"), is the beneficial owner of 50.4% of
the outstanding shares of Common Stock. ARC, a corporation that acquires and
develops companies focused in the entertainment, leisure and communications
industries, holds its Common Stock through its indirect wholly-owned subsidiary,
Canrad of Delaware, Inc. ("Canrad Delaware"). As a result of the level of its
beneficial ownership of the Common Stock, ARC is in a position to control
substantially all corporate matters requiring stockholder approval, including
the election of directors and merger and consolidation proposals, and thereby is
in a position to control the Company. Such control may have the effect of
delaying or preventing a change in control of the Company, including
transactions in which stockholders might otherwise receive a premium for their
shares over the market price of such shares. Currently, two members of the Board
are directors and employees of ARC or its affiliates (other than the Company),
and one of such directors has substantial shareholdings in ARC. In connection
with the Company's initial public offering, Canrad Delaware agreed with the
managing underwriters of such offering to vote, until September 12, 1997, all
shares of voting capital stock of the Company beneficially owned by it in the
same proportion as the votes cast by non-affiliates with respect to any
liquidation, and certain mergers or business combinations involving the Company.
SHARES ELIGIBLE FOR FUTURE SALE; REGISTRATION RIGHTS
Future sales of Common Stock in the public market, or the perception that
such sales could occur, could adversely affect the market price of the Common
Stock or the Company's ability to raise additional capital through sales of its
equity securities. Upon completion of the offering, in addition to the 2,277,000
shares sold in the Company's initial public offering, the 1,897,500 shares
offered in a secondary public offering in August of 1996 and the 447,150 shares
offered hereby, the Company will have (i) 4,323,000 shares of outstanding owned
by Canrad Delaware, a subsidiary of ARC; (ii) 825,000 shares of Common Stock
reserved for issuance under the Company's stock option plans, of which 604,500
shares are issuable pursuant to currently outstanding options thereunder; (iii)
447,150 shares of Common Stock issuable pursuant to outstanding warrants and
other options to purchase Common Stock and (iv) 150,000 shares of Common Stock
reserved for issuance pursuant to the Company's employee stock purchase plan.
All of the shares of Common Stock owned by Canrad Delaware as well as the
stock of certain other subsidiaries of ARC (including Cabletel Communications
Corporation ("Cabletel"), whose shares are publicly traded), have been pledged
to Merita Bank Ltd ("Merita Bank") to secure indebtedness of Canrad Delaware's
parent company, Canrad Inc., under a revolving credit facility (the "Canrad
Credit Facility"). The Company has been advised by Canrad Delaware that, as of
December 31, 1996, the
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principal amount of indebtedness outstanding under the Canrad Credit Facility
was approximately $6.8 million. In the event of a default under the Canrad
Credit Facility, Merita Bank has certain rights as a secured creditor under the
terms of the Canrad Credit Facility to vote and to sell or otherwise dispose of
all or a portion of the pledged shares, including the Common Stock.
UNCERTAINTY OF FUTURE ACQUISITIONS
Significant uncertainties accompany any acquisition and its integration with
the Company's existing operations, such that any acquisition could have an
adverse effect on the Company. There can be no assurance that the Company will
be able to locate appropriate acquisition candidates, that any identified
candidates will be acquired or that acquired operations will be effectively
integrated or prove profitable. The Company's revolving credit facility with
Norwest Bank Nebraska N.A. ("Norwest Bank") currently prohibits the Company from
making acquisitions without the consent of Norwest Bank. The Company currently
has no money borrowed under the revolving credit facility.
CERTAIN ANTI-TAKEOVER PROVISIONS
The Company's Certificate of Incorporation provides for, among other things,
the issuance of 1,000,000 shares of preferred stock. The Board is authorized,
without stockholder approval, to cause the Company to issue such preferred stock
in one or more series and to fix the voting powers and the designations,
preferences and relative, participating, optional or other rights and
restrictions thereof. Accordingly, the Company may issue a series of preferred
stock in the future that will have preference over the Common Stock with respect
to the payment of dividends and upon the Company's liquidation, dissolution or
winding up or have voting or conversion rights that could adversely affect the
voting power and ownership percentages of the holders of Common Stock. The
Company's Certificate of Incorporation also provides for the affirmative vote of
at least 66 2/3% of all outstanding shares of capital stock entitled to vote
generally in the election of directors, voting as a single class, to change
certain provisions of such Certificate of Incorporation and the Company's
By-Laws, and to change the authority of the Board, without further action by
stockholders, to cause the Company to issue shares of preferred stock. The
Company's Certificate of Incorporation further provides for the division of the
Board into three classes. One class of directors is elected at each annual
meeting of stockholders for three-year terms. The Company 's By-Laws contain
certain advance notice requirements relating to stockholder proposals and
stockholder nomination of directors. These provisions, together with the level
of beneficial ownership of the outstanding Common Stock by ARC, may have the
effect of making more difficult or discouraging transactions that could give
stockholders of the Company the opportunity to realize a premium over the then
prevailing market price for their shares of Common Stock.
POSSIBLE VOLATILITY OF STOCK PRICE; LIMITED TRADING VOLUME
The trading price of the Common Stock may be highly volatile and could be
subject to significant fluctuations in response to variations in the Company's
quarterly operating results, general conditions in the industries in which the
Company operates and other factors. In addition, the stock market is subject to
price and volume fluctuations affecting the market price for the stock of many
companies generally, which fluctuations often are unrelated to operating
performance. Although the Common Stock is listed on the AMEX, daily trading
volume of the Common Stock has generally been limited and accordingly the
trading price is more vulnerable to significant fluctuations.
USE OF PROCEEDS
The Company is registering the Common Stock pursuant to demands from the
Selling Stockholders. The Company will receive net proceeds of approximately
$1,802,162, after expenses of this offering if the Merita Warrant, GFCP Option
and Jaffoni Option are exercised in whole. The Company has no specific plans for
the proceeds to be received if and when the Merita Warrant, GFCP Option and
Jaffoni Option
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are exercised. It is anticipated that the proceeds would be used for working
capital purposes or to finance future acquisitions of this Company.
There can be no assurance that any of the Jaffoni Option, the GFCP Option or
the Merita Warrant will be exercised, in whole or in part.
DIVIDEND POLICY
The Company intends to retain its earnings to assist in financing its
business and does not anticipate paying any dividends on its Common Stock in the
foreseeable future. The Norwest Facility, the Canrad Credit Facility and the
Company's industrial development revenue bond ("IRB") contain certain
prohibitions on the payment of cash dividends. In addition, the underwriting
agreement relating to the Company's initial public offering restricts the
payment of cash dividends until September 1997. The declaration and payment of
dividends by the Company are also subject to the discretion of the Board. Any
determination by the Board as to the payment of dividends in the future will
depend upon, among other things, business conditions and the Company's financial
condition and capital requirements, as well as any other factors deemed relevant
by the Board.
SELLING SECURITY HOLDERS
The following table sets forth the beneficial ownership of Common Stock of
the Company for the Selling Stockholders as of February 21, 1997, (assuming the
Warrant and Options had been exercised in full) and as adjusted to reflect the
sale of shares offered hereby by the Selling Stockholders (assuming 100% of the
shares offered hereby are sold). In addition, all numbers have been adjusted to
reflect a 3 for 2 stock split effected as a 50% stock dividend on March 5, 1997
to Stockholders of record on February 10, 1997.
<TABLE>
<CAPTION>
AMOUNT OF BENEFICIAL
BENEFICIAL OWNERSHIP OF COMMON
OWNERSHIP OF COMMON STOCK
PRIOR TO OFFERING(1) STOCK AFTER OFFERING(3)
---------------------------- NUMBER OF ----------------------------------
PERCENTAGE OF SHARES TO PERCENTAGE OF
NUMBER OF OUTSTANDING BE NUMBER OF OUTSTANDING
NAME OF BENEFICIAL OWNER SHARES(1) SHARES(4) OFFERED(2) SHARES SHARES(4)
- ---------------------------------------------------- ----------- --------------- ----------- --------------- -----------------
<S> <C> <C> <C> <C> <C>
Merita Bank Ltd(5).................................. 323,400 3.6% 323,400 0 0
Geller & Friend Capital Partners, Inc.(6)........... 82,500 0.9% 82,500 0(8) 0
Jaffoni & Collins, Inc.(7).......................... 41,250 0.5% 41,250 0 0
</TABLE>
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(1) As of February 21, 1997 the warrant held by Merita was exercisable for
323,400 shares of Common Stock, the GFCP Option was exercisable for 82,500
shares of Common Stock and the Jaffoni Option was exercisable for 41,250
shares of Common Stock.
(2) Includes 323,400 by Merita, 82,500 by GFCP and 41,250 by Jaffoni, and
assumes full exercise of Warrant and both Options.
(3) Assuming the sale of all offered shares.
(4) Based upon a total outstanding amount of 9,016,935 shares, which assumes
full exercise of the Warrant and both Options at the respective conversion
ratios in effect on February 21, 1997.
(5) Warrant received in partial consideration for providing certain financial
assistance in connection with the Company's acquisition of Cinema Products
Division of ORC.
(6) Currently exclusive advisor to the Company with respect to strategic
financial matters. Option received as partial compensation for services.
Marshall S. Geller, a stockholder of the corporation, currently serves on
the Company's Board of Directors.
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(7) Currently advisor to the Company with respect to investor relations and
financial relations. Option received as partial consideration for services.
(8) This number does not include any shares or options personally owned by
Marshall S. Geller.
PLAN OF DISTRIBUTION
Merita is hereby offering for sale pursuant to this Prospectus, 323,400
shares of Common Stock issuable upon exercise of the Merita Warrant. GFCP is
hereby offering for sale pursuant to this Prospectus, 82,500 shares of Common
Stock issuable to GFCP upon exercise of the GFCP Option. Jaffoni is hereby
offering for sale pursuant to this Prospectus, 41,250 shares of Common Stock
issuable to Jaffoni upon exercise of the Jaffoni Option. As of February 21,
1997, the Warrant and both Options had not been exercised and, accordingly, none
of the Common Stock underlying the Warrant and Options had been issued.
The distribution of shares of Common Stock by the Selling Stockholders may
be effected in one or more transactions that may take place in ordinary broker
transactions, privately negotiated transactions or through sales to one or more
dealers for resale of such securities as principals, at market prices prevailing
at the time of sale, at prices related to such prevailing market prices or at
negotiated prices. Usual and customary or specifically negotiated brokerage fees
or commissions may be paid by the Selling Stockholders in connection with such
sales of securities.
In order to comply with certain state securities laws, if applicable, the
securities offered hereby will not be sold in a particular state unless such
securities have been registered or qualified for sale in such state or an
exemption from registration or qualification is available and complied with.
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DESCRIPTION OF CAPITAL STOCK
The total number of shares the Company is authorized to issue is 11,000,000,
consisting of 10,000,000 shares of Common Stock, par value $.01 per share, and
1,000,000 shares of Preferred Stock, par value $.01 per share. As of February
21, 1997, there were 8,569,785 shares of Common Stock outstanding and no shares
of Preferred Stock outstanding.
COMMON STOCK
Holders of Common Stock are entitled to one vote for each share held of
record on all matters to be voted on by the stockholders. There is no cumulative
voting with respect to the election of directors, with the result that the
holders of a majority of the shares of Common Stock voting for the election of
directors can elect all of the directors then up for election. The holders of
Common Stock are entitled to receive dividends, subject to the senior rights of
preferred stockholders, when, as and if declared by the Board out of funds
legally available therefor. In the event of liquidation, dissolution or winding
up of the Company, the holders of Common Stock are entitled to share ratably in
all assets remaining which are available for distribution to them after payment
of liabilities and after provision has been made for each class of stock having
preference over the Common Stock. Holders of shares of Common Stock, as such,
have no conversion, preemptive or other subscription rights, and there are no
redemption provisions applicable to the Common Stock. All of the outstanding
shares of Common Stock are, and, upon completion of the offering, all shares of
Common Stock offered hereby will be, duly authorized, fully paid and non-
assessable.
The Delaware General Corporation Law provides that stockholders may take
action without the holding of a meeting by written consent or consents signed by
the holders of a majority of the outstanding shares of the capital stock of the
Company entitled to vote thereon. Prompt notice of the taking of any action
without a meeting by less than unanimous consent of the stockholders will be
given to those stockholders who do not consent in writing to the action. The
purposes of this provision are to facilitate action by stockholders and to
reduce the corporate expense associated with annual and special meetings of
stockholders. Currently, ARC beneficially owns 50.4% of the outstanding Common
Stock. Accordingly, ARC is in a position to control the voting results of
certain actions required or permitted to be taken by stockholders of the
Company, including the election of directors without the holding of a meeting.
Pursuant to the rules and regulations of the Commission, if stockholder action
is taken by written consent, the Company will be required to send each
stockholder entitled to vote on the matter acted on, but whose consent was not
solicited, an information statement containing information substantially similar
to that which would have been contained in a proxy statement.
PREFERRED STOCK
The Board is authorized, without further approval or action by the
stockholders, to issue shares of Preferred Stock in one or more series and to
determine the rights, preferences, privileges and restrictions thereof,
including dividend rights, conversion rights, voting rights, terms of
redemption, liquidation preferences, sinking fund terms and number of shares
constituting any series of Preferred Stock or the designation of such series.
The rights of the holders of Common Stock will generally be subject to the
prior rights of the holders of any outstanding shares of Preferred Stock with
respect to dividends, liquidation preferences and other matters. Among other
things, the Preferred Stock could be issued by the Company to raise capital or
finance acquisitions. The Preferred Stock could have certain anti-takeover
effects under certain circumstances. The issuance of shares of Preferred Stock
could enable the Board to render more difficult or discourage an attempt to
obtain control of the Company by means of a merger, tender offer or other
business combination transaction directed at the Company by, among other things,
placing shares of Preferred Stock with investors who might align themselves with
the Board, issuing new shares to dilute
8
<PAGE>
stock ownership of a person or entity seeking control of the Company or creating
a class or series of Preferred Stock with class voting rights.
The Company has no current plans to issue any shares of its Preferred Stock.
DELAWARE ANTI-TAKEOVER LAW
The Company is subject to the provisions of Section 203 of the Delaware
General Corporation Law. Section 203 provides, with certain exceptions, that a
Delaware corporation may not engage in certain business combinations with a
person or affiliate or associate of such person who is an "interested
stockholder" for a period of three years from the date such person became an
interested stockholder unless: (i) the transaction resulting in the acquiring
person's becoming an interested stockholder, or the business combination, is
approved by the board of directors of the corporation before the person becomes
an interested stockholder; (ii) the interested stockholder acquires 85% or more
of the outstanding voting stock of the corporation in the same transaction which
makes it an interested stockholder (excluding shares owned by directors who are
also officers, and excluding certain employee stock option plans); and (iii) on
or after the date the person becomes an interested stockholder, the business
combination is approved by the corporation's board of directors and by the
holders of at least 66 2/3% of the corporation's outstanding voting stock at an
annual or special meeting, excluding shares owned by the interested stockholder.
Except as otherwise specified in Section 203, an "interested stockholder" is
defined as (a) any person that is the owner of 15% or more of the outstanding
voting stock of the corporation, (b) any person that is an affiliate or
associate of the corporation and was the owner of 15% or more of the outstanding
voting stock of the corporation at any time within the three year period
immediately prior to the date on which it is sought to be determined whether
such person is an interested stockholder, or (c) the affiliates and associates
of any such person. By restricting the ability of the Company to engage in
business combinations with an interested person, the application of Section 203
to the Company may provide a barrier to hostile or unwanted takeovers. Under
Delaware law, the Company could have opted out of Section 203 but elected to be
subject to its provision.
CERTAIN PROVISIONS OF THE COMPANY'S CERTIFICATE OF INCORPORATION AND BY-LAWS
CLASSIFIED BOARD OF DIRECTORS. The Company's Certificate of Incorporation
and By-Laws provide that the Board shall be divided into three classes of
directors serving staggered terms. One class of directors will be elected at
each annual meeting of stockholders for a three-year term. Thus, at least two
annual meetings of stockholders, instead of one, generally will be required to
change the majority of the Board. Directors can be removed from office only for
cause and only by the affirmative vote of at least 66 2/3% of the then
outstanding shares of capital stock entitled to vote generally in the election
of directors, voting as a single class. Vacancies on the Board may be filled
only by the remaining directors and not the stockholders. The foregoing
provisions may have the effect of making it more difficult to acquire control of
the Company by means of a hostile tender offer, open market purchases, a proxy
contest or otherwise.
REQUIREMENT FOR ADVANCE NOTIFICATION OF STOCKHOLDER NOMINATION AND
PROPOSALS. The Company's By-Laws require 60 to 90 days' notice to the Company
with regard to stockholder proposals and the nomination, other than by or at the
direction of the board or a committee thereof, of candidates for election as
directors. Such notice must provide specified information, including information
regarding the ownership of Common Stock by the person giving the notice,
information regarding the proposal or the nominees and information regarding the
interest of the proponent in the proposal or the nominations.
SPECIAL MEETINGS OF STOCKHOLDERS. The Company's Certificate of
Incorporation and By-Laws provide that special meetings of stockholders of the
Company may only be called by the Chairman of the Board, the President or a
majority of the then authorized number of directors. This provision precludes
stockholders from calling a special meeting and taking actions opposed by the
Board.
9
<PAGE>
LIMITATION OF DIRECTOR LIABILITY. The Company's Certificate of
Incorporation limits the liability of directors to the Company or its
stockholders to the fullest extent permitted by Delaware law. Specifically,
under current Delaware law, a director will not be personally liable for
monetary damages for breach of the director's fiduciary duty or care as a
director, except liability (i) for a breach of the director's duty of loyalty to
the Company or its stockholders, (ii) for acts or omissions by a director not in
good faith or which involve intentional misconduct or a knowing violation of
law, (iii) for liability arising under Section 174 of the Delaware General
Corporation Law (relating to the declaration of dividends and purchase or
redemption of shares in violation of the Delaware General Corporation Law) or
(iv) for any transaction from which the director derived an improper personal
benefit. The inclusion of this provision in the Company's Certificate of
Incorporation may have the effect of reducing the likelihood of derivative
litigation against directors and may discourage or deter stockholders or
management from bringing a lawsuit against directors for breach of their duty of
care.
SUPERMAJORITY PROVISIONS. The Company's Certificate of Incorporation
provides that the vote of the Board or the affirmative vote of at least 66 2/3%
of the then outstanding shares of capital stock entitled to vote generally in
the election of directors, voting as a single class, is required to amend,
repeal or alter any of the Company's By-Laws or the foregoing provisions
contained in the Company's Certificate of Incorporation.
TRANSFER AGENT
The transfer agent and registrar for the Common Stock is ChaseMellon
Shareholder Services, LLC whose address is 85 Challenger Road, Overpeck Center,
Ridgefield Park, NJ 07660.
LEGAL MATTERS
The legality of the shares of Common Stock offered hereby will be passed
upon for the Company by Cline, Williams, Wright, Johnson and Oldfather, Omaha,
Nebraska.
10
<PAGE>
PART II
EXPENSES OF ISSUANCE AND DISTRIBUTION
<TABLE>
<S> <C> <C>
Registration fees........................................... / / $2,009.26
Federal and State Taxes..................................... / / 0
Transfer Agent fees......................................... /X/ 0
Costs of printing & engraving............................... /X/ $ 100
Legal fees.................................................. /X/ $ 5,000
Accounting fees............................................. /X/ $ 2,000
Engineering fees............................................ / / 0
---------
Total..................................................... /X/ $9,109.26
---------
---------
</TABLE>
INDEMNIFICATION OF DIRECTORS,
OFFICERS AND CONTROLLING PERSONS
The provision regarding indemnification of directors and officers is found
in the Bylaws of the Company which are incorporated by reference to Exhibit 3.2
to the Registration Statement on Form S-1 (File No. 33-93244).
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers or persons controlling the
registrant pursuant to the foregoing provisions, the registrant has been
informed that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is
therefore unenforceable.
II-1
<PAGE>
EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT
- ----------- --------------------------------------------------------------------------------------------------------
<C> <S>
4.1 Certificate of Incorporation, as amended through July 20, 1995 (incorporated by reference to Exhibit 3.1
and 3.3 to the Registration Statement on Form S-1 (File No. 33-93244).
4.2 Bylaws of the Company, as amended through August 24, 1995 (incorporated by reference to Exhibit 3.2 to
the Registration Statement on Form S-1 [File No. 33-93244]).
5 Opinion of Counsel
23.1 Independent Auditors Consent
23.2 Consent of Counsel (included in Exhibit 5)
</TABLE>
II-2
<PAGE>
UNDERTAKINGS
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:
To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material changes to such information 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.
The undersigned registrant hereby undertakes that, for 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 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to 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.
The undersigned registrant hereby undertakes to deliver or cause to be
delivered with the prospectus, to each person to whom the prospectus is sent or
given, the latest annual report to security holders that is incorporated by
reference in the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by
Article e of Regulation S-X are not set forth in the prospectus, to deliver, or
cause to be delivered to each person to whom the prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the prospectus to provide such interim financial information.
II-3
<PAGE>
SIGNATURES
THE REGISTRANT. 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 Omaha, State of Nebraska on February 24, 1997.
BALLANTYNE OF OMAHA, INC.
BY:
--------------------------------------
Brad French, Secretary, Treasurer
Chief Financial Officer and
Principal
Accounting Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
- ------------------------------ Chairman and Director 2/ /97
Arnold S. Tenney
- ------------------------------ President, Chief Executive 2/ /97
Ronald H. Echtenkamp Officer and Director
- ------------------------------ Vice President, Sales 2/ /97
John P. Wilmers Director
- ------------------------------ Director 2/ /97
Jeffrey D. Chelin
- ------------------------------ Director 2/ /97
Colin G. Campbell
- ------------------------------ Director 2/ /97
Yale Richards
- ------------------------------ Director 2/ /97
Marshall S. Geller
II-4
<PAGE>
SIGNATURES
THE REGISTRANT. 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 Omaha, State of Nebraska on February 24, 1997.
BALLANTYNE OF OMAHA, INC.
BY: BRAD FRENCH
--------------------------------------
Brad French, Secretary, Treasurer
Chief Financial Officer and
Principal
Accounting Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
/s/ ARNOLD S. TENNEY Chairman and Director 2/24/97
- ------------------------------
President, Chief Executive
/s/ RONALD H. ECHTENKAMP Officer and Director 2/24/97
- ------------------------------
Vice President, Sales
/s/ JOHN P. WILMERS Director 2/24/97
- ------------------------------
/s/ JEFFREY D. CHELIN Director 2/24/97
- ------------------------------
- ------------------------------ Director 2/ /97
Colin G. Campbell
/s/ YALE RICHARDS Director 2/24/97
- ------------------------------
- ------------------------------ Director 2/ /97
Marshall S. Geller
II-5
<PAGE>
FEBRUARY 24, 1997
Mr. Ronald H. Echtenkamp
President and Chief Executive Officer
Ballantyne of Omaha, Inc.
4350 McKinley Street
Omaha, NE. 68112
Re: Registration Statement on Form S-3
Dear Mr. Echtenkamp:
We have acted as legal counsel for Ballantyne of Omaha, Inc., a Delaware
corporation, (the "Company") in connection with the Company's preparation of the
above-referenced Registration Statement on Form S-3 (the "Form S-3") being filed
with the Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933, as amended, (the "Act") and the prospectus (the
"Prospectus"). The Form S-3 and the Prospectus relate to the registration by the
Company of 323,400 shares of Common Stock to be issued upon exercise of a
warrant (the "Warrant") granted to Merita Bank Ltd, 82,500 shares of Common
Stock to be issued upon exercise of an option (the "Geller Option") granted to
Geller & Friend Capital Partners, Inc., and 41,250 shares of Common Stock to be
issued upon exercise of an option (the "Jaffoni Option") granted to Jaffoni &
Collins, Inc.
In connection herewith, we have examined: (i) the Form S-3 and the
Prospectus; (ii) the Certificate of Incorporation, as amended, and the Bylaws as
amended, of the Company; (iii) the corporate minutes and proceedings of the
Company applicable to filing of the Form S-3; and (iv) such other proceedings,
documents and records as we deem necessary or appropriate for the purpose of
making this opinion. In making such examinations, we have assumed the
genuineness of all signatures on all documents and conformed originals to all
copies submitted to us as conformed or photocopies. In addition to such
examination, we have ascertained or verified such additional facts as we deem
necessary or appropriate for purposes of this opinion. However, as to various
questions of fact material to our opinion, we have relied upon representations,
statements or certificates of officers, directors, or representatives of the
Company or others.
Based upon the foregoing, we are of the opinion that: (i) the Company has
been legally incorporated and is validly existing under the laws of the state of
Delaware; and (ii) the shares to be issued upon exercise of the Warrant and
Options upon issuance and payment therefore, as contemplated by the respective
Warrant or Option Agreements, the Form S-3 and the Prospectus, will be validly
issued, fully paid and non-assessable Common Stock of the Company.
We hereby consent to the filing of this opinion as an exhibit to the Form
S-3 and to any references to our firm in the Prospectus. In giving this consent
we do not admit that we have come within the category of persons whose consent
is required under Section 7 of the Act or the Rules and Regulations of the
Commission promulgated thereunder.
Very truly yours,
Cline, Williams, Wright,
Johnson and Oldfather
<PAGE>
[LETTERHEAD]
ACCOUNTANTS' CONSENT
The Board of Directors
Ballantyne of Omaha, Inc.;
We consent to incorporation by reference in the registration statement
(No. ____) on Form S-3 of Ballantyne of Omaha, Inc. of our report, dated
January 19, 1996, relating to the consolidated balance sheets of Ballantyne
of Omaha and subsidiaries as of December 31, 1995 and 1994, and the related
consolidated statements of income, retained earnings and cash flows for each
of the years in the three-year period ended December 31, 1995, and all
related schedule, which report appears in the December 31, 1995 Annual Report
on Form 10-K of Ballantyne of Omaha, Inc.
KPMG Peat Marwick LLP
----------------------
KPMG Peat Marwick LLP
Omaha, Nebraska
February 24, 1997
