-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GBwO9GVKo+ZIsiOy2gqcLP6NxmFnuTulnh9DOZyKq76t2eZUoMB2686ZiHqJa9WD bmyJ73ViesyDRZtGubMnMQ== 0000893220-96-001595.txt : 19960921 0000893220-96-001595.hdr.sgml : 19960921 ACCESSION NUMBER: 0000893220-96-001595 CONFORMED SUBMISSION TYPE: 424B1 PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19960919 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: K TRON INTERNATIONAL INC CENTRAL INDEX KEY: 0000000020 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL INSTRUMENTS FOR MEASUREMENT, DISPLAY, AND CONTROL [3823] IRS NUMBER: 221759452 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 424B1 SEC ACT: 1933 Act SEC FILE NUMBER: 333-11783 FILM NUMBER: 96632333 BUSINESS ADDRESS: STREET 1: ROUTE 55 & 553 STREET 2: BOX 888 CITY: PITMAN STATE: NJ ZIP: 08071-0888 BUSINESS PHONE: 6096616240 MAIL ADDRESS: STREET 1: ROUTE 55 & 553 STREET 2: P O BOX 888 CITY: PITMAN STATE: NJ ZIP: 08071-0888 424B1 1 K-TRON INTERNATIONAL RULE 424(B)(1) 1 FILED PURSUANT TO RULE 424(b)(1) REGISTRATION NO. 333-11783 PROSPECTUS 150,000 Shares K-TRON INTERNATIONAL, INC. Common Stock ($.01 Par Value) ------------------------------- The shares offered hereby (the "Shares") consist of up to 150,000 shares of common stock, $.01 par value per share (the "Common Stock"), of K-Tron International, Inc., a New Jersey corporation (the "Company"). The Shares may be offered from time to time by the Selling Shareholder identified herein. See "Selling Shareholder." The Selling Shareholder offering the Shares covered by this Prospectus is a director of the Company. The Company will not receive any part of the proceeds from the sale of the Shares. All expenses of registration incurred in connection herewith are being borne by the Selling Shareholder. The Selling Shareholder has not advised the Company of any specific plans for the distribution of the Shares covered by this Prospectus, but it is anticipated that the Shares will be sold from time to time in negotiated transactions and in transactions (which may include block transactions) on the Nasdaq National Market of The Nasdaq Stock Market at the market price then prevailing, although sales may also be made as described herein under "Plan of Distribution." The Selling Shareholder and the brokers and dealers through whom sale of the Shares may be made may be deemed to be "underwriters" within the meaning of the Securities Act of 1933, as amended, and their commissions or discounts and other compensation may be regarded as underwriters' compensation. See "Plan of Distribution." THE SHARES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK. SEE "RISK FACTORS" COMMENCING ON PAGE 3 OF THIS PROSPECTUS. The Company's Common Stock is quoted on the Nasdaq National Market under the symbol "KTII." On September 18, 1996, the last reported sale price of the Common Stock was $8.25 per share. ----------------------------- 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 PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESEN- TATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ----------------------------- The date of this Prospectus is September 19, 1996. 2 AVAILABLE INFORMATION This Prospectus constitutes a part of a registration statement on Form S-3 (herein, together with all exhibits thereto, referred to as the "Registration Statement") filed by the Company with the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended (the "Securities Act"), with respect to the securities offered hereby. This Prospectus does not contain all the information set forth in the Registration Statement, certain parts of which are omitted in accordance with the rules and regulations of the Commission. Reference is hereby made to the Registration Statement and to the exhibits thereto for further information with respect to the Company and the securities offered hereby. Copies of the Registration Statement and the exhibits thereto are on file at the offices of the Commission and may be obtained upon payment of the prescribed fee or may be examined without charge at the public reference facilities of the Commission described below. The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance therewith, files reports, proxy statements and other information with the Commission. Such reports, proxy statements and other information can be inspected and copied at the public reference facilities maintained by the Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the Commission's regional offices located at Seven World Trade Center, New York, New York 10048 and Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such material can be obtained in person from the Public Reference Section of the Commission at its principal office located at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Reports and proxy statements concerning the Company also may be inspected at the offices of the National Association of Securities Dealers, Inc., 1735 K Street, N.W., Washington, D.C. 20006. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents or portions of documents filed by the Company (File No. 0-9576) with the Commission are incorporated herein by reference: (a) The Company's Annual Report on Form 10-K for the fiscal year ended December 30, 1995. (b) The Company's Quarterly Reports on Form 10-Q for the quarterly periods ended March 30, 1996 and June 29, 1996. (c) The description of the Company's Common Stock, $.01 par value (the "Common Stock"), which is contained in the Company's Registration Statement on Form 8-A filed with the Commission under the Exchange Act, on March 19, 1981, including any amendment or report filed for the purpose of updating such description. All reports and other documents filed 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 filing of a post-effective amendment which indicates that all securities offered hereby have been sold or which deregisters all securities remaining unsold, shall be deemed to be incorporated by reference herein and to be a part hereof from the date of the filing of such reports and documents. Any statement contained in a document, all or a portion of which is incorporated by reference herein, shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained or incorporated by reference herein modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. Upon request, the Company will provide without charge to each person to whom this Prospectus is delivered a copy of any or all of such documents which are incorporated herein by reference (other than exhibits to such documents unless such exhibits are specifically incorporated by reference into the documents that this Prospectus incorporates). Written or oral requests for copies should be directed to Robert L. Weinberg, Senior Executive Vice President and Chief Financial Officer, K-Tron International, Inc., Routes 55 and 553, P.O. Box 888, Pitman, New Jersey 08071-0888, (609) 589-0500. 2 3 THE COMPANY Founded in 1964, the Company's principal operating businesses are conducted by subsidiaries which design, produce, market and sell gravimetric and volumetric feeders and related equipment for the handling of bulk solids in a wide variety of manufacturing processes. The Company has manufacturing facilities in the United States and Switzerland, and its equipment is sold throughout the world. The Company's feeders control by weight or volume the rate at which ingredients are fed into the manufacturing processes of numerous products, primarily in the plastics, food, chemical, cement, glass and aluminum industries. In addition, the Company designs, produces and sells electronic assemblies and controls, and it provides customer and employee training through its K-Tron Institute. The Company's principal executive offices are located at Routes 55 and 553, Pitman, New Jersey 08071, and its telephone number at that address is (609) 589-0500. RISK FACTORS In addition to the other information in this Prospectus, prospective investors should consider the following risk factors in evaluating the Company and its business before purchasing any shares offered hereby. UNCERTAIN SWISS BANKING RELATIONSHIPS The Company's Swiss manufacturing subsidiary is in violation of certain equity guarantees contained in its loan agreements with several Swiss lenders which resulted in a default under such loan agreements. The subsidiary has entered into a forbearance agreement with its Swiss lenders under which they have agreed to defer until March 31, 1997 the repayment of credit lines and the principal payments on fixed loans that become due prior to that date. The Company and its subsidiary are exploring ways to refinance or reduce the subsidiary's bank indebtedness in Switzerland or to extend the forbearance agreement, but the defaults are continuing and have not been waived and there can be no assurance that the Company will be able to refinance or reduce its bank indebtedness in Switzerland or to extend the forbearance agreement or that, if alternative financing is available, it could be obtained on terms that would be favorable or acceptable to the Company. HIGH LEVERAGE; LIMITATIONS ASSOCIATED WITH EXISTING DEBT COVENANTS; REFINANCING RISK As of June 29, 1996, the principal amount outstanding under the Swiss loan agreements was $24.2 million and the principal amount outstanding under the U.S. loan agreements was $5.8 million. The Company's highly leveraged financial position poses significant risks to the Company, including the risks that (i) a substantial portion of the cash flow from operations will be required to pay interest, (ii) the Company's ability to obtain future financing, for working capital, capital expenditures and other purposes, may be impeded and (iii) the Company may be more vulnerable to economic downturns and less able to respond to competitive pressures. The Company's credit agreements restrict, among other things, the ability of the Company to incur additional indebtedness, pay dividends, prepay subordinated indebtedness, create liens, dispose of certain assets, enter into sale and leaseback transactions, engage in mergers or enter into transactions with affiliates. These restrictions, in combination with the Company's high leverage, could limit the Company's ability to respond to opportunities and to changing market and economic conditions. If the Company is unable to maintain compliance with the terms of its credit agreements it may be required to refinance its outstanding debt or obtain additional financing. There can be no assurance that any such refinancing would be possible or that any additional financing could be obtained on terms that would be favorable or acceptable to the Company. 3 4 CYCLICAL INDUSTRY The markets for the Company's products are cyclical. During periods of economic expansion, particularly when capital spending is increasing, the Company generally benefits from increased demand for its products. During periods of economic contraction, the Company is generally adversely affected by declining demand for its products. There can be no assurance that an increase in demand or an economic recovery will be sustained in the Company's markets. INTERNATIONAL SALES; FOREIGN EXCHANGE RISKS In fiscal 1995 and the six months ended June 29, 1996, 74% and 68%, respectively, of the Company's net sales to unaffiliated customers were made to customers outside of the United States. The Company expects that international sales will continue to account for a significant portion of its net sales in future periods. International sales are subject to fluctuations in exchange rates, which may have an adverse effect on the Company's business, operating results and financial condition. Since the results of operations of the Company's subsidiaries are translated to United States dollars, the Company's results of operations are affected by fluctuations in exchange rates among the United States dollar, Swiss franc, German mark and French franc. In addition, as the Company's subsidiaries sell into other countries, these transactions are affected by numerous cross exchange rates. COMPETITION The Company's products are sold in highly competitive markets in the United States, Europe and Asia. The Company competes with companies of varying sizes, including foreign manufacturers and divisions or subsidiaries of larger companies. Some of these competitors may have financial resources that are substantially greater than those of the Company. The Company believes that over the past several years it has experienced increased price competition because of prevailing economic conditions in the Company's markets. Competitive pressures or other factors could cause the Company's products to lose market share or result in significant price erosion which would have an adverse effect on the Company's results of operations. DEPENDENCE ON SUPPLIERS Each product produced by the Company requires the supply of components specially engineered to meet the Company's requirements. Supply of these components can be affected by numerous factors beyond the control of the Company. While certain of the Company's components are obtained from a single or limited number of sources, the Company has potential alternate suppliers for most of the specialty components used in its assembly operations. There can be no assurance, however, that the Company will not experience shortages or be forced to seek alternative sources of supply which may increase costs or adversely affect the Company's ability to fulfill orders. DEPENDENCE ON KEY PERSONNEL The Company is dependent upon the continued services of certain key officers and management and operating personnel. The loss of key personnel could have a material adverse effect on the Company. The Company does not maintain "key man" insurance for any of its officers. The Company's continued success also depends on its ability to attract and retain a skilled labor force. There can be no assurance that the Company will be successful in attracting and retaining the personnel it requires to develop, manufacture and market its products or expand its operations. CERTAIN ANTI-TAKEOVER PROVISIONS The ability of the Board of Directors of the Company to issue shares of preferred stock without shareholder approval and a shareholder rights plan adopted by the Company may, alone or in combination, have certain anti-takeover effects, including inhibiting a change in control of the Company under circumstances that could give the shareholders the opportunity to realize a premium over the then-prevailing market prices. 4 5 DIVIDEND POLICY The Company is not currently paying any cash dividends on its Common Stock and does not intend to do so for the foreseeable future. USE OF PROCEEDS The Company will not receive any proceeds from the sale of the Shares by the Selling Shareholder. SELLING SHAREHOLDER All of the Shares are being sold by Johannes Wirth (the "Selling Shareholder"), who will receive all of the proceeds from the sale of the Shares. The Selling Shareholder is, and at all times since May 1978 has been, a director of the Company. The Selling Shareholder's term as a director continues until the 1999 annual meeting of shareholders. The Shares are being registered to permit public secondary trading of the Shares, and the Selling Shareholder may offer the Shares for resale from time to time. See "Plan of Distribution." In recognition of the fact that the Selling Shareholder may wish to be legally permitted to sell his Shares when he deems appropriate, the Company has filed with the Commission, under the Securities Act, a Registration Statement on Form S-3, of which this Prospectus forms a part, with respect to the resale of the Shares from time to time on the Nasdaq National Market of The Nasdaq Stock Market or in privately-negotiated transactions and has agreed to prepare and file such amendments and supplements to the Registration Statement as may be necessary to keep the Registration Statement effective until the Shares are no longer required to be registered for the sale thereof by the Selling Shareholder. From April 1991 through December 1995, the Selling Shareholder was retained as a consultant by the Company. Under this arrangement, he provided technical assistance and advice on such matters as were referred to him by the chief executive officer of the Company. From April 1991 through February 28, 1995, Mr. Wirth devoted approximately 1,000 hours per year to such work and was paid an annual consulting fee of 100,000 Swiss francs ("Sfr.") plus Sfr. 10,000 for travel expenses. Effective March 1, 1995, Mr. Wirth's annual consulting fee was reduced to Sfr. 50,000 plus Sfr. 5,000 for travel expenses, with a commensurate reduction in his hourly consulting commitment to approximately 500 hours per year, and at the end of 1995, Mr. Wirth's consulting arrangement with the Company terminated. During 1995, Mr. Wirth received a consulting fee for these services of Sfr. 58,355 plus Sfr. 5,834 for travel expenses (an aggregate of $54,415 at an exchange rate of $.848 per Sfr., which was the average $/Sfr. exchange rate for 1995). Mr. Wirth may continue to provide consulting services to the Company in 1996 if requested by the chief executive officer of the Company's Swiss subsidiary. The following table sets forth certain information with respect to the Common Stock beneficially owned by the Selling Shareholder as of the date of this Prospectus.
Beneficial Ownership Beneficial Ownership of Common Stock of Common Stock Prior to the Offering After Offering(1) -------------------------------- Number of Shares to ---------------------------------- Number Percent of be Sold Under this Number Percent of Name of Shares Class Prospectus of Shares Class ---- --------- ----- ---------- --------- ---------- Johannes Wirth 247,400 7.9 150,000 97,400 3.1
- ------------------------------ (1) Assumes the sale of all of the Shares offered hereby. 5 6 PLAN OF DISTRIBUTION The Shares offered hereby by the Selling Shareholder may be sold from time to time by the Selling Shareholder, or by pledgees, donees, transferees or other successors in interest. Such sales may be made on one or more exchanges or in the over-the-counter market (including the Nasdaq National Market of The Nasdaq Stock Market), or otherwise at prices and at terms then prevailing or at prices related to the then-current market price, or in negotiated transactions. The Shares may be sold by one or more of the following methods, without limitation: (a) a block trade in which the broker-dealer so engaged will attempt to sell the Shares as agent but may position and resell a portion of the block as principal to facilitate the transaction; (b) purchases by a broker or dealer as principal and resale by such broker or dealer for its account pursuant to this Prospectus; (c) ordinary brokerage transactions and transactions in which the broker solicits purchasers; (d) an exchange distribution in accordance with the rules of such exchange; and (e) face-to-face transactions between the Selling Shareholder and purchasers without a broker-dealer. In effecting sales, brokers or dealers engaged by the Selling Shareholder may arrange for other brokers or dealers to participate. Such brokers or dealers may receive commissions or discounts from the Selling Shareholder in amounts to be negotiated immediately prior to the sale. Such brokers or dealers and any other participating brokers or dealers may be deemed to be "underwriters" within the meaning of the Securities Act in connection with such sales. In addition, any securities covered by this Prospectus that qualify for sale pursuant to Rule 144 might be sold under Rule 144 rather than pursuant to this Prospectus. Upon the Company being notified by the Selling Shareholder that any material arrangement has been entered into with a broker or dealer for the sale of Shares through a block trade, special offering, exchange distribution or secondary distribution or a purchase by a broker or dealer, a supplemented Prospectus will be filed, if required, pursuant to Rule 424(c) under the Securities Act, disclosing (a) the name of each such broker-dealer, (b) the number of Shares involved, (c) the price at which such Shares were sold, (d) the commissions paid or discounts or concessions allowed to such broker-dealer(s), where applicable, (e) that such broker-dealer(s) did not conduct any investigation to verify the information set out or incorporated by reference in this Prospectus, as supplemented, and (f) other facts material to the transaction. The Selling Shareholder is bearing all costs relating to the registration of the Shares, including any commissions or other fees payable to broker-dealers in connection with any sale of the Shares. The Company and the Selling Shareholder have entered into an agreement whereby the Selling Shareholder has advised the Company that during such times as the Selling Shareholder may be deemed to be engaged in a distribution of the Common Stock, and therefore an "underwriter" under the Securities Act, he will comply with Rules 10b-2, 10b-6 and 10b-7 under the Exchange Act and therefore will, among other things: (a) not engage in any stabilization activities in connection with the Company's securities; (b) furnish each broker-dealer through which Shares may be offered such copies of this Prospectus, as amended from time to time, as may be required by such broker-dealer; and (c) not bid for or purchase any securities of the Company or attempt to induce any person to purchase any securities of the Company other than as permitted under the Exchange Act. The Company has agreed to indemnify the Selling Shareholder and may indemnify certain persons who may be deemed to be "underwriters", in certain circumstances, against certain liabilities, including liabilities arising under the Securities Act. The Selling Shareholder has agreed to indemnify the Company and its directors, officers and agents, and may indemnify certain "underwriters" that participate in transactions involving the sale of the Shares against certain liabilities, including liabilities arising under the Securities Act. LEGAL OPINION The validity of the Shares offered hereby will be passed upon for the Company by Morgan, Lewis & Bockius LLP, Philadelphia, Pennsylvania. Edward B. Cloues, II, a director of the Company, is a partner of Morgan, Lewis & Bockius LLP. 6 7 EXPERTS The consolidated financial statements of the Registrant and its subsidiaries as of December 30, 1995 and for the years ended December 30, 1995, December 31, 1994 and January 1, 1994, each included in the Registrant's Report on Form 10-K for the fiscal year ended December 30, 1995, have been incorporated by reference in this registration statement in reliance, with respect to the consolidated financial statements for the fiscal years ended December 30, 1995 and December 31, 1994, upon the report of Arthur Andersen LLP, independent public accountants, and with respect to the consolidated financial statements for the fiscal year ended January 1, 1994, upon the report of Deloitte & Touche LLP, independent auditors, all incorporated by reference herein, and upon the authority of each such firm as experts in accounting and auditing. 7 8 ========================================================= ====================================================== No dealer, salesperson or other person has 150,000 Shares been authorized to give any information or to make any representations other than those contained in this Prospectus and, if given or made, such information or representations must not be relied K-TRON INTERNATIONAL, INC. upon as having been authorized by the Company or the Selling Shareholder or by any other person. This Prospectus does not constitute an offer to sell, or a solicitation of an offer to buy a security other than the shares of Common Stock offered hereby, nor does it constitute an offer to sell or a solicitation of an offer to buy any of the securities offered hereby to any person in any COMMON STOCK jurisdiction in which such offer or solicitation would be unlawful. Neither the delivery of this Prospectus nor any offer or sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the Company or that information contained herein is correct as of any time subsequent to the date hereof. --------------- --------------- PROSPECTUS --------------- TABLE OF CONTENTS Page ---- Available Information . . . . . . . . . . . . . 2 Incorporation of Certain Documents by Reference . . . . . . . . . . . . . . . . 2 The Company . . . . . . . . . . . . . . . . . . 3 September 19, 1996 Risk Factors . . . . . . . . . . . . . . . . . 3 Use of Proceeds . . . . . . . . . . . . . . . . 5 Selling Shareholder . . . . . . . . . . . . . . 5 Plan of Distribution . . . . . . . . . . . . . 6 Legal Opinion . . . . . . . . . . . . . . . . . 6 Experts . . . . . . . . . . . . . . . . . . . . 7 ========================================================= ======================================================
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