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FILED PURSUANT TO RULE 424b(3)
REGISTRATION NO. 333-20289
RECYCLING INDUSTRIES, INC.
FIRST SUPPLEMENT TO PROSPECTUS DATED FEBRUARY 24, 1997
On April 7, 1997, the Company acquired substantially all of the assets of
Addlestone Recycling Corporation ("ARC"), a privately held metals recycler with
operations in Metter, Georgia. The total purchase price paid for ARC was $5.5
million including $500,000 paid in the form of 10,000 shares of the Company's
Series D Convertible Preferred Stock (the "Series D Shares"). The $5 million
cash portion of the purchase price was funded from long term debt obtained from
Coast Business Credit, a division of Southern Pacific Thrift and Loan.
The acquisition of ARC, which had 1996 revenues of $14 million, increased
the Company's monthly shredding capacity by 7,000 tons.
Holders of the Series D Shares are entitled to dividends on a cumulative
basis at an annual rate of eight percent, payable quarterly in cash.
The Series D Shares will automatically convert on April 1, 1999 into that
number of shares of the Company's common stock whose average market price for
the ten trading days preceding the date of conversion is equivalent to $500,000
plus the amount of all accrued and unpaid dividends on the Series D Shares to
the date of conversion. If a consolidation or merger of the Company with or
into another company or entity occurs and the Company is not the surviving
entity, the Series D Shares will convert immediately into that number of shares
of the Company's common stock whose average market price for the ten trading
days preceding the date of consolidation or merger is equivalent to $500,000
plus the amount of all accrued and unpaid dividends on the Series D Shares to
the date of conversion.
No later than June 5, 1999 the Company will file and cause to be effective
a registration statement(s) with Securities and Exchange Commission to permit
the resale of the shares of the Company's common stock received upon conversion
of the Series D Shares.
As a result of this acquisition, the Company owns and operates eight metals
recycling facilities in Nevada, Texas, Iowa, Missouri and Georgia.
On April 8, 1997, the Company executed a definitive agreement to acquire
substantially all the assets of Addlestone International Corporation's
Georgetown, South Carolina, metals recycling facility (the "Georgetown
facility"). The Georgetown facility acquisition is subject to the Company's
satisfactory completion of due diligence and obtaining sufficient financing to
fund the acquisition. If completed, the Georgetown facility will be the
Company's ninth metals recycling facility.
THE DATE OF THIS SUPPLEMENT IS APRIL 21, 1997.
