SCHEDULE: NN Inc. Appoints Legion Partners Nominee to Board

NN Inc. and activist investor Legion Partners have entered into a cooperation agreement, leading to the appointment of Raymond T. White to NN Inc.'s board of directors.

Summary

• NN Inc. and Legion Partners entered into a Cooperation Agreement on January 16, 2026.
• The agreement led to the expansion of NN Inc.'s board of directors from seven to eight members.
• Raymond T. White, a nominee of Legion Partners, was appointed to the newly created directorship and to the Strategic Committee of the Board.
• Mr. White will serve as a director until the Issuer's 2026 annual meeting of stockholders and will be nominated for election at that meeting and subsequent annual meetings prior to the expiration of the standstill period.
• Legion Partners and its affiliated entities collectively beneficially own approximately 9.95% of NN Inc.'s outstanding common stock, totaling 5,016,929 shares.
• The total outstanding shares of NN Inc. were 50,195,810 as of October 24, 2025.
• Reporting Persons are subject to customary standstill restrictions, including not acquiring beneficial ownership of more than 19.9% of outstanding shares, until the earlier of 30 days prior to the director nomination deadline for the 2028 annual meeting or 120 days prior to the first anniversary of the 2027 annual meeting.
• Reporting Persons have also agreed to vote in a manner consistent with the Board's recommendation, with exceptions for ISS/Glass Lewis recommendations on non-director proposals and Extraordinary Matters.

Sentiment

Score: 7

Explanation: The cooperation agreement and board appointment suggest a constructive resolution between the company and an activist investor, which is generally positive for corporate governance and potential strategic improvements. However, the standstill agreement limits the activist's future actions, which could be seen as a slight negative for aggressive value creation.

Positives

• Increased shareholder representation on the board with the appointment of Raymond T. White, a nominee of a significant activist investor.
• The cooperation agreement suggests a constructive resolution between the company and Legion Partners, potentially avoiding a contentious proxy fight.
• Mr. White's appointment to the Strategic Committee indicates a focus on strategic direction and potential value creation initiatives.

Negatives

• Legion Partners is subject to a standstill agreement, limiting their ability to acquire more than 19.9% of shares or engage in certain activist actions during the standstill period.
• Legion Partners has agreed to vote in line with the Board's recommendations, with limited exceptions, which could restrict their independent influence on certain corporate matters.

Risks

• The standstill agreement limits Legion Partners' ability to increase its stake or pursue certain activist strategies, potentially capping upside from further direct intervention.
• The voting agreement could reduce the independent influence of Legion Partners on certain corporate matters, aligning them more closely with existing board recommendations.

Future Outlook

The cooperation agreement outlines a path for continued representation of Legion Partners on the board, with Raymond T. White nominated for election at future annual meetings until the standstill period expires. The standstill period itself extends until 30 days prior to the director nomination deadline for the 2028 annual meeting or 120 days prior to the first anniversary of the 2027 annual meeting, indicating a multi-year framework for engagement.

Industry Context

This filing reflects a common trend in corporate governance where activist investors, after accumulating a significant stake, engage with company management to secure board representation. Such cooperation agreements often aim to avoid costly and disruptive proxy contests, signaling a potentially more collaborative approach to value creation. The appointment of an activist's nominee to a strategic committee suggests a focus on long-term strategic direction, which is a frequent objective of activist campaigns.

Comparison to Industry Standards

• The 9.95% stake held by Legion Partners is a typical threshold for activist investors seeking board representation without triggering certain regulatory requirements or hostile takeover concerns.
• The terms of the standstill agreement, including the duration and voting restrictions, are standard in cooperation agreements between activist investors and public companies, balancing shareholder influence with corporate stability.
• The appointment of an activist's nominee to a strategic committee is a common outcome, as it allows the activist to directly influence key strategic decisions, similar to agreements seen with companies like Starboard Value at GCP Applied Technologies or Elliott Management at various targets.

Management Changes

Corporate Governance

Stakeholder Impact

• Shareholders: Increased representation on the board for a significant activist investor could lead to enhanced focus on shareholder value. The cooperation agreement reduces the likelihood of a disruptive proxy fight.
• Management/Board: The agreement provides stability and a clear framework for engagement with a major shareholder, potentially reducing internal conflict.

Next Steps

• Raymond T. White will serve as a director until NN Inc.'s 2026 annual meeting of stockholders.
• NN Inc. will nominate Mr. White for election at the 2026 annual meeting and subsequent annual meetings prior to the expiration of the standstill period.
• Legion Partners will adhere to standstill restrictions and voting agreements until the earlier of 30 days prior to the director nomination deadline for the 2028 annual meeting or 120 days prior to the first anniversary of the 2027 annual meeting.

Key Dates

Recommendation

The cooperation agreement with Legion Partners, including board representation and a standstill, suggests a period of stability and potential strategic review for NN Inc. While the activist's involvement could be a catalyst for value creation, the standstill limits immediate aggressive actions. Investors should hold to observe the impact of the new director and any strategic initiatives that emerge from the board's Strategic Committee. The current filing does not provide enough financial detail to warrant a strong buy or sell recommendation, but the governance changes are a positive step.

Keywords

NN Inc., Legion Partners, Cooperation Agreement, Board Appointment, Shareholder Activism, Corporate Governance, Schedule 13D, Raymond T. White, Standstill Agreement