<PAGE> 1
As filed with the Securities and Exchange Commission on July 3, 1996
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------------
METAL MANAGEMENT, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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DELAWARE 94-2835068
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
1250 NINTH STREET
BERKELEY, CALIFORNIA 94710
(510) 524-3950
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
---------------------------
WILLIAM A. SPAZANTE
VICE PRESIDENT FINANCE, AND
CHIEF FINANCIAL OFFICER
METAL MANAGEMENT, INC.
1250 NINTH STREET
BERKELEY, CALIFORNIA 94710
(510) 524-3950
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
---------------------------
Copy to:
ROBERT T. CLARKSON
WILSON SONSINI GOODRICH & ROSATI,
PROFESSIONAL CORPORATION
650 PAGE MILL ROAD
PALO ALTO, CALIFORNIA 94304
(415) 493-9300
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to
time after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, check the following box. / /
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 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. / /
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. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
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<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
===========================================================================================================================
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF EACH CLASS AMOUNT OFFERING AGGREGATE AMOUNT OF
OF SECURITIES TO TO BE PRICE OFFERING REGISTRATION
BE REGISTERED REGISTERED PER SHARE (1) PRICE (1) FEE
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock
$.01 par value........................ 300,000 shares $4.4375 $1,331,250 $459.05
========================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of computing the amount of the
registration fee pursuant to Rule 457(c) under the Securities Act of
1933, on the basis of the average of the high and low sale prices
reported on the Nasdaq National Market System on July 1, 1996.
---------------------------
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 thereafter 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 as the
Commission, acting pursuant to said Section 8(a), may determine.
===============================================================================
<PAGE> 2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
PROSPECTUS SUBJECT TO COMPLETION, JULY 3, 1996
300,000 SHARES
METAL MANAGEMENT, INC.
COMMON STOCK
($0.01 PAR VALUE)
This Prospectus relates to the sale of shares of the common stock
("Common Stock") of Metal Management, Inc. (together with its consolidated
subsidiaries, "Metal Management" or the "Company"), offered from time to time by
Copperstate Metals, Inc. (the "Selling Stockholder"), which received such shares
in exchange for its Common Stock of EMCO Recycling Corp. ("EMCO"), upon the
merger of a wholly owned subsidiary of the Company with and into EMCO on April
11, 1996. Such shares were issued pursuant to an exemption from the registration
requirements of the Securities Act of 1933, as amended, provided by Section 4(2)
thereof. It is anticipated that the Selling Stockholder will generally offer
shares of Common Stock for sale at prevailing prices in the over-the-counter
market on the date of sale. See "Plan of Distribution." The Company will receive
no part of the proceeds from sales made hereunder. All reasonable legal and
accounting fees, filing and registration fees incurred in order to register the
Selling Stockholder's shares are being borne by the Company, but all commissions
and transfer taxes, if any, and the fees and expenses of the Selling
Stockholder's counsel will be borne by such Selling Stockholder. None of the
shares offered pursuant to this Prospectus have been registered prior to the
filing of the Registration Statement of which this Prospectus is a part.
The Common Stock of the Company is traded in the over-the-counter
market on the Nasdaq National Market. On July 1, 1996, the closing price of the
Company's Common Stock, as reported by Dow Jones News Retrieval, was $4.375.
(Nasdaq Symbol: MTLM).
SEE "RISK FACTORS" COMMENCING ON PAGE 4 FOR A DISCUSSION OF CERTAIN
FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK
OFFERED HEREBY.
The Selling Stockholder and any broker executing selling orders on
behalf of the Selling Stockholder may be deemed to be an "underwriter" within
the meaning of the Securities Act of 1933, as amended (the "Securities Act").
Commissions received by any such broker may be deemed to be underwriting
commissions under the Securities Act.
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.
The date of this Prospectus is July __, 1996.
<PAGE> 3
AVAILABLE INFORMATION
The Company is subject to the informational reporting 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 Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the Public
Reference Room of the Commission, 450 Fifth Street, N.W., Washington, D.C.
20549, and at the Commission's regional offices at 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661-2511; and copies of such material can be
obtained from the Public Reference Section of the Commission, Washington, D.C.
20549, at prescribed rates. Information, as of particular dates, concerning
directors and officers of the Company, their remuneration, options granted to
them, the principal holders of securities of the Company, and any material
interest of such persons in transactions with the Company has been or will be
disclosed in the proxy statements to be distributed to stockholders of the
Company and filed with the Commission.
ADDITIONAL INFORMATION
The Company has filed with the Commission a Registration Statement on
Form S-3, under the Securities Act, with respect to the shares of Common Stock
offered hereby. This Prospectus does not contain all of the information set
forth in the Registration Statement and the exhibits thereto. For further
information with respect to the Company and the Common Stock offered hereby,
reference is made to the Registration Statement and the exhibits filed therewith
or incorporated by reference. Statements contained in this Prospectus regarding
the contents of any contract or any other document referred to are not
necessarily complete, and in each instance reference is made to the copy of such
contract or other document filed as an exhibit to the Registration Statement or
otherwise filed with the Commission, each statement being qualified in all
respects by such reference. The Registration Statement may be inspected without
charge at the offices of the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549, and copies of all or any part thereof may be obtained from such
office upon the payment of the fees prescribed by the Commission.
INFORMATION INCORPORATED BY REFERENCE
There are hereby incorporated by reference in this Prospectus the
following documents and information heretofore filed with the Securities and
Exchange Commission:
(1) The Company's Annual Report on Form 10-K for the fiscal year ended
October 31, 1995, filed pursuant to Section 13 of the Exchange Act.
(2) The Company's Quarterly Reports on Form 10-Q for the fiscal quarter
ended January 31, 1996, and the transition period ended March 31, 1996,
filed pursuant to Section 13 of the Exchange Act.
(3) The Company's Current Report on Form 8-K dated April 11, 1996 (the
"Form 8-K"), filed pursuant to Section 13 of the Exchange Act.
(4) The Company's Amendment No. 1 on Form 8-K/A (the "Form 8-K/A") to the
Form 8-K, dated June 20, 1996, filed pursuant to Section 13 of the
Exchange Act.
(5) The Definitive Joint Proxy Statement of the Company and EMCO Recycling
Corp., dated March 8, 1996, in connection with the Company's Annual
Meeting of Stockholders held April 9, 1996, filed pursuant to Section
14 of the Exchange Act.
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(6) The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A, which became effective
July 30, 1986, filed pursuant to Section 12(g) of the Exchange Act,
including any amendment or report filed for the purpose of updating
such description.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14
or 15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering of securities contemplated hereby shall be deemed to
be incorporated by reference in this Prospectus or any Prospectus Supplement and
to be a part hereof from the date of filing of such documents. Any statement
contained in a document incorporated by reference or deemed to be incorporated
by reference in this Prospectus or any Prospectus Supplement shall be deemed to
be modified or superseded for all purposes of this Prospectus or such Prospectus
Supplement to the extent that a statement contained herein, therein or in any
subsequently filed document that also is incorporated or deemed to be
incorporated by reference herein or in such Prospectus Supplement modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Prospectus or any Prospectus Supplement.
The Company will provide without charge to each person to whom a copy
of this Prospectus has been delivered, upon the written or oral request of such
person, a copy of any and all of the documents referred to above that have been
or may be incorporated in this Prospectus by reference (other than exhibits to
such documents, unless such exhibits are specifically incorporated by reference
therein). Requests for such copies should be directed to: the Company's Vice
President, Finance, and Chief Financial Officer, Metal Management, Inc., 1250
Ninth Street, Berkeley, California 94710. The Company's telephone number at that
location is (510) 524-3950.
The documents incorporated by reference herein contain forward-looking
statements that involve risks and uncertainties. The Company's actual results
may differ materially from the results discussed in the forward-looking
statements. Factors that might cause such a difference include, but are not
limited to, those discussed in such documents and in "Risk Factors" below.
---------------------------------
No person is authorized to give any information or to make any
representations, other than those contained in this Prospectus, in connection
with the offering described herein, and, if given or made, such information or
representations must not be relied upon as having been authorized by the
Company. This Prospectus does not constitute an offer to sell, or a solicitation
of an offer to buy, nor shall there be any sale of these securities by any
person in any jurisdiction in which it is unlawful for such person to make such
offer, solicitation or sale. Neither the delivery of this Prospectus nor any
sale made hereunder shall under any circumstances create an implication that the
information contained herein is correct as of any time subsequent to the date
hereof.
THE COMPANY
Metal Management, Inc. (the "Company") was incorporated under the laws
of Delaware in June 1986, as General Parametrics Corporation ("GPC"), and
succeeded to the business of General Parametrics Corporation, a California
corporation, pursuant to a reincorporation merger effected in June 1986. The
California corporation was incorporated in 1981. The Company changed its name to
Metal Management, Inc. on April 12, 1996. The Company's principal executive
offices are located at 1250 Ninth Street, Berkeley, CA 94710, and its telephone
number at that address is (510) 524-3950. The Company has announced that it
intends to move its offices and corporate headquarters to Chicago, IL.
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<PAGE> 5
RECENT DEVELOPMENTS
On April 11, 1996, the Company acquired EMCO Recycling Corp., an
Arizona corporation ("EMCO"), by means of a merger in which the Company's
wholly owned subsidiary, GPAR Merger, Inc., an Arizona corporation ("Sub"), was
merged with and into EMCO, with EMCO remaining as the surviving corporation,
pursuant to a Merger Agreement dated as of December 1, 1995, and as amended
through March 7, 1996 (the "Merger Agreement"), among the Company, Sub, EMCO,
and the beneficial owners of EMCO's Common Stock (the "Merger"). In the Merger,
the outstanding shares of EMCO were converted into the right to receive an
aggregate of 3,500,000 shares of Common Stock of the Company, warrants to
purchase an aggregate of an additional 1,000,000 shares of Common Stock of the
Company and $1,150,000 in cash. In conjunction with the Merger, the Company
purchased two parcels of land owned directly or beneficially by Harold M.
Rubenstein, the former principal beneficial shareholder of EMCO, a new director
of the Company and the largest beneficial owner of the Company's shares. The
Company also, upon closing of the Merger, advanced EMCO $950,000, and EMCO paid
its demand note of $950,000 to Donald F. Moorehead, a director of the Company
and of EMCO. The Company filed a Form 8-K dated April 11, 1996, incorporated by
reference herein, in which it reported that by virtue of the Merger, there may
have been a change of control of the Company, as well as an acquisition or
disposition of assets. The Form 8-K also reported a change in fiscal year end
from October 31 to March 31, effective April 1, 1996. Details of the Merger are
set forth more fully in the Definitive Joint Proxy Statement of the Company and
EMCO dated March 8, 1996, filed with the Commission and incorporated by
reference herein.
RISK FACTORS
In addition to the risks set forth in the Company's Annual Report on
Form 10-K for the year ended October 31, 1995, and the Company's Quarterly
Reports on Form 10-Q for the quarter ended January 31, 1996, and for the
transition period ended March 31, 1996, the other documents incorporated herein
by reference and the other information in this Prospectus, the following factors
should be considered carefully in evaluating the Company and its business before
purchasing the Common Stock offered hereby.
The risk factors described below, as well as the documents incorporated
herein by reference, contain forward-looking statements that involve risks and
uncertainties. The Company's and EMCO's actual results may differ materially
from the results discussed in the forward-looking statements.
RECENT MERGER AND SIGNIFICANT CHANGE IN STRATEGIC DIRECTION
In the past year, the Company has undergone a significant change in
strategic direction and emphasis. On April 11, 1996, the Company acquired EMCO
Recycling Corp., an Arizona corporation ("EMCO") engaged in scrap metal
processing, pursuant to the Merger Agreement. In addition, the Company
purchased two parcels of land owned directly or beneficially by Harold M.
Rubenstein, the former principal beneficial shareholder and former Chairman of
the Board of EMCO. The Company anticipates future acquisitions of other
companies in the scrap metal industry and potentially also in other industries,
including but not limited to telecommunications. Immediately prior to the
Merger with EMCO, the Company's business had consisted of designing,
manufacturing and marketing color printers and related consumables, including
ribbons, transparencies and paper. After the Merger, the Company's previous
lines of business have continued within the Company's Spectra*Star Division.
Reflective of the Company's overall change in emphasis is its corporate name
change on April 12, 1996, from General Parametrics Corporation ("GPC") to Metal
Management, Inc. The ramifications of the changes in the Company's business are
discussed in greater detail in the risk factors listed below.
Given the substantial changes in the Company's business as a result of
the Merger, past financial performance should not be considered a reliable
indicator of future performance. Potential purchasers should not use historical
trends to anticipate results or trends in future periods.
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CYCLICALITY OF OPERATING RESULTS
The operating results of the scrap metal processing industry in general
and the Company's EMCO subsidiary in particular are highly cyclical in nature as
they tend to reflect and amplify the general national economic condition. In
periods of national recession or periods of minimal economic growth, EMCO's
operations have been materially adversely affected. During recessions or periods
of minimal economic growth, the automobile and the construction industries
typically experience major cutbacks in production, resulting in decreased demand
for steel, copper and aluminum supplies. For example, from approximately 1988 to
1993, the scrap industry was adversely affected for a period of five years. Due
in part to this effect, the predecessors of EMCO, Empire Metals, Inc. and
Copperstate Metals, Inc., entered bankruptcy proceedings in 1990 and 1991,
respectively. The ability of the Company and EMCO to withstand significant
economic downturns in the future will depend in part on the amount of available
cash held by the Company. Recently, EMCO has required cash infusions from the
Company due to what it believes to be short-term liquidity requirements; there
can be no assurance, however, that liquidity constraints will not continue or
worsen. From February 1996 through March 1996, EMCO's margins declined over the
results noted in the Company's Definitive Joint Proxy Statement dated March 8,
1996, filed with the Commission, but such margins ceased declining in April and
May 1996. As a result of the above and increased interest expense, EMCO's
operating results for the period from February 1, 1996, through April 30, 1996,
declined from the pro forma information contained in the Proxy Statement dated
March 8, 1996. Future economic downturns may be expected to materially and
adversely affect operating results.
RISK OF EXPANSION STRATEGY
The Company currently plans to pursue additional acquisitions in the
scrap metal area and, potentially, in other related or unrelated fields,
including but not limited to telecommunications. There can be no assurance that
any future mergers will be consummated or that, if they are, the Company will be
able to effectively manage disparate business enterprises. The ability of the
Company to achieve its expansion objectives and to manage its growth effectively
depends on a variety of factors, including the ability to identify appropriate
acquisition targets and to negotiate acceptable terms for their acquisition, the
integration of new businesses into the Company's operations and the availability
of capital. These difficulties will be exacerbated in the event that the Company
expands in states outside of Arizona and California. The inability to control or
manage growth effectively or to successfully integrate future new business into
the Company's operations would have a material adverse effect on the Company's
financial condition and results of operations. There can be no assurance that
the Company will be able to successfully expand or that growth and expansion
will result in profitability. There can be no assurance that the Company will be
able to realize any of the other anticipated benefits of the Merger or any
future acquisitions that it may undertake.
EXISTING AND FUTURE DEBT OF THE COMPANY
As of May 31, 1996, the Company had approximately $12.6 million in
consolidated debt. In order to pursue expansion and acquisition opportunities,
the Company may find it necessary to incur additional debt, either through bank
or credit lines or the sale of debt securities in registered or unregistered
transactions, in addition to any additional equity financing it may do. The
servicing of such present and future debt of the Company will utilize cash
either in the form of cash on hand or cash generated by operating activities.
RISK OF DILUTION TO EXISTING STOCKHOLDERS
The Company's strategy of expansion and additional acquisitions will
require it to issue additional shares of Common Stock or securities convertible
into Common Stock as consideration for additional acquisitions. Issuance of a
material amount of Common Stock or such securities would result in significant
dilution to the then-existing stockholders of the Company. The Company may also
be required to seek equity financing to meet
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future capital requirements, which would also result in additional dilution. See
"Immediate and Future Capital Requirements."
PRICE FLUCTUATIONS
EMCO's results of operations have been in the past, and the results of
operations of the overall Company are expected to be, subject to price
fluctuations that occur in the metals commodities markets. While EMCO has in the
past found it unnecessary to hedge its exposures to fluctuating metals prices
because of the short-term nature of its purchase and sale agreements, an
abnormally sharp decline in prices could expose EMCO and the Company to
potential losses on inventories that have not been committed to specific sales
contracts. Such losses could have a material adverse effect on the Company's
results of operations.
RELIANCE ON EMCO MANAGEMENT
Those members of the current Company management team who came from GPC
have no experience in the operation of scrap metal processing operations such
as EMCO's. While management team members who came from EMCO do have such
experience, both they and the former GPC managers may be outside their areas of
experience in the event that the Company pursues acquisition opportunities
outside of scrap metal processing, or printers and related consumable products.
Additionally, while T. Benjamin Jennings, the current Chairman of the Board and
Chief Development Officer, is currently devoting substantially all of his time
to such position, Gerard M. Jacobs, the current President and Chief Executive
Officer, has numerous other business interests and will be unable for some time
to dedicate his full time to the Company's operations. However, since the
Merger, Mr. Jacobs has been able to reduce his personal time commitment to
certain of such other business interests and is currently devoting most of his
business time to the Company. As a result, the success of the Company will
depend, in large part, upon the involvement of EMCO management. There can be no
assurance that the Company will be able to retain key management personnel.
Additionally, certain members of EMCO management have been involved in
bankruptcy proceedings in the past as a result of the bankruptcy proceedings of
EMCO's predecessor companies, Copperstate Metals, Inc., and Empire Metals,
Inc.
COMPETITION IN THE SCRAP METAL INDUSTRY
The scrap metal processing industry is highly competitive, with the
principal competitive factors being price and availability of scrap metal
supplied. Competition in the industry is intense in part because the barriers to
entry into the scrap metal collection business are relatively low. Additionally,
EMCO will face competition from producers of finished steel products, many of
whom have substantially greater financial resources than EMCO and the Company,
who may vertically integrate by entering the scrap metal processing business.
The inability of EMCO to compete in this environment would have a material
adverse effect on the Company's financial condition and results of operations.
IMMEDIATE AND FUTURE CAPITAL REQUIREMENTS
Scrap metal processing companies such as EMCO have substantial ongoing
working capital and capital equipment requirements in order to continue to
operate and grow. During March 1996, the Company loaned EMCO $1,000,000 for
short-term working capital requirements. Upon closing of the Merger, the Company
advanced EMCO $950,000, and EMCO paid its demand note of $950,000 to Donald F.
Moorehead, a director of the Company and EMCO. Also, subsequent to March 31,
1996, the Company loaned EMCO an additional $500,000 for additional working
capital purposes. The Company may find it necessary to infuse additional cash
into EMCO for additional working capital purposes. In order to remain
competitive, EMCO must continue to make significant investments in capital
equipment. As a result, the Company will likely seek equity or debt financing to
fund future improvements and expansion of EMCO's scrap metal processing business
as well as to make other acquisitions of scrap metal processing facilities.
There can be no assurance that such financing will
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<PAGE> 8
be available when needed, or that, if available, it will be on satisfactory
terms. The failure to obtain financing would hinder the Company's and EMCO's
ability to make continued investments in capital equipment and pursue
expansions, which could materially adversely affect results of operations. Any
such equity financing would result in dilution to the then-existing stockholders
of the Company.
CONTROL OF COMPANY BY MANAGEMENT AND PRINCIPAL STOCKHOLDERS
As a result of the Merger, Messrs. Jacobs and Jennings, together with
George O. Moorehead and Donald F. Moorehead, with whom Messrs. Jacobs and
Jennings have had substantial past business relationships, collectively own an
aggregate of approximately 28% of the outstanding Common Stock of the Company.
In addition, Harold Rubenstein, formerly the Chairman of the Board of EMCO,
beneficially owns approximately 26% of the outstanding Common Stock of the
Company, while Gerald Zack, Raymond F. Zack and David M. Zack, who are brothers,
collectively beneficially own an aggregate of approximately 13% of the
outstanding Common Stock of the Company prior to the sale of shares by the
Selling Stockholder. All shares beneficially held by the Zack brothers are held
indirectly through the Selling Stockholder. After the sale of shares being
registered by this Registration Statement, the Zacks will collectively
beneficially hold 10% of the Company's outstanding shares. Accordingly, Messrs.
Jennings and Jacobs, together with the Mooreheads, Harold Rubenstein and the
Zacks, will collectively have sufficient voting power (approximately 58%) after
the sale of shares being registered to control the outcome of all matters
(including the election of a majority of the directors and any future merger,
consolidation or sale of assets of the Company) submitted to Company
stockholders for approval and may be deemed to have effective control over the
affairs and management of the Company. This assumes that the shares being
offered by the Selling Stockholder will not be purchased by any of the
individuals in the aforementioned group. The sale of some or all of the shares
to such individuals would increase commensurately the control of such
individuals and the group over the Company. This controlling interest in the
Company may also have the effect of making certain transactions more difficult
or impossible, absent the support of Messrs. Jennings and Jacobs and such other
persons. Such transactions could include proxy contests, mergers involving the
Company, tender offers and open market purchase programs that could give
stockholders of the Company the opportunity to realize a premium over the
then-prevailing market price of their shares of Common Stock.
CONCENTRATION OF CUSTOMERS AND CREDIT RISK
The Company's three largest customers for the five-month period ended
March 31, 1996, represented in the aggregate approximately 18.9% of the
Company's revenues, based on pro forma financial results of the combined Company
(including EMCO) for that period. The Company's results of operations are
substantially dependent upon continuing orders from such customers, and any
cancellation of or reduction in orders from such customers could have a material
adverse effect on the Company's results of operations. This risk is exacerbated
by the fact that most of the Company's customers are not bound by long-term
purchase contracts but instead do business with the Company on the basis of
short-term contracts.
One customer accounted for $905,000, or approximately 13%, of the
Company's total accounts receivable for the five-month period ended March 31,
1996, based on pro forma results of the combined Company for that period.
DEPENDENCE ON SCRAP SUPPLIERS
EMCO's scrap processing operations are dependent upon the supply of
scrap materials from its suppliers. Few of such suppliers are bound by long-term
supply agreements, and therefore they have no obligation to continue to supply
scrap materials to EMCO. In the event that substantial numbers of scrap
suppliers cease supplying scrap materials to EMCO, the Company's financial
condition and results of operations would be materially and adversely affected.
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ENVIRONMENTAL MATTERS
Like many other companies in the scrap metal processing business, EMCO
is subject to comprehensive local, state and international regulatory and
statutory requirements relating to the acceptance, storage, handling and
disposal of solid waste and waste water, air emissions, soil contamination and
employee health, among others. Environmental legislation and regulations have
changed rapidly in recent years, and it is likely that EMCO, and any other scrap
metal subsidiaries the Company may acquire in the future, will be subject to
even more stringent environmental standards in the future.
The Company is currently aware of two ongoing environmental matters in
connection with EMCO's business. The first matter concerns certain operating
permits for an auto shredder and a furnace used in removing insulation from
copper wire. The Environmental Protection Agency concluded that Copperstate had
operated those two pieces of equipment while possessing only a temporary permit
from the Arizona Department of Environmental Quality ("ADEQ") when a permanent
permit should have been obtained. The EPA assessed a fine against Copperstate
and EMCO for failure to obtain a permit. EMCO has paid its fine totaling $9,000
and is awaiting formal dismissal by the EPA, which it expects to receive in the
near future. In the second matter, environmental consultants to the Company
reported that an underground storage tank located at one of EMCO's yards had not
been reported to the Arizona environmental authorities as required by law. EMCO
as lessee reported the matter to the owner of the property, and believes that
such report is the extent of its obligations with respect to this matter.
However, there can be no assurance that any failure of the owner to report will
not result in liability of or the assessment of penalties against the Company
and/or EMCO.
EMCO has a policy of not knowingly accepting, handling or discharging
hazardous waste products, and the Company and EMCO are not aware of any material
concentrations of hazardous waste located on any of EMCO's properties. However,
as part of a pre-Merger review, the Company hired an environmental consulting
firm to conduct Phase I or Phase II site assessments or transaction screen
reviews (the "Pre-Merger Site Assessments") of nearly all of the sites owned or
leased by EMCO in Arizona and the sites that were purchased from Harold
Rubenstein or his affiliates in Tucson. The environmental consultants completed
certain investigations of reviewed sites and delivered all final transaction
screen assessments, Phase I and/or Phase II reports, as appropriate, that they
were requested to deliver. Certain of these reports revealed that some soil or
groundwater contamination is likely at some sites and recommended that certain
additional investigations and remediation be conducted. Based upon its review of
the reports, the Company believes that it is likely that contamination exists at
certain of the sites and that it is likely that remediation will be required at
some of the sites. Also based upon its review of these reports, the Company
believes that such contamination is likely to include, but not be limited to:
polychlorinated biphenyls (PCBs); total petroleum hydrocarbons; volatile organic
compounds (VOCs), including perchloroethylene, trichlorofluoromethane,
trichloroethylene, trichloroethane and dichloroethylene; antimony; arsenic,
cadmium; copper; lead; mercury; silver; zinc; waste oil; toluene; meta- and
para-xylenes; baghouse dust; and aluminum dross. The ultimate extent of
contamination cannot be stated with any certainty at this point, and there can
be no assurance that the cost of remediation will be immaterial. The Company has
supplied the Pre-Merger Site Assessments to EMCO, and EMCO has retained a
qualified environmental and chemical consulting firm in Arizona to review them,
to examine EMCO's ongoing operations, and to recommend to EMCO's management and
Board of Directors any steps EMCO should take to achieve and/or maintain
compliance, including but not limited to any necessary remedial measures or
operational changes.
Due to the nature of the scrap metal business, it is possible that
inquiries or claims based upon environmental laws may be made in the future by
governmental bodies or individuals against the Company, EMCO and any other scrap
metal processing entities that the Company may acquire. The location of EMCO's
facilities in large urban areas may increase the risk of scrutiny and claims.
The Company is unable to predict whether any such future inquiries or claims
will in fact arise or the outcome of such matters. Additionally, it is not
possible to predict the total size of all capital expenditures or the amount of
any increases in operating costs
-8-
<PAGE> 10
or other expenses that may be incurred to comply with any environmental
requirements, or whether all such cost increases can be passed on to customers
through product price increases. Moreover, environmental legislation has been
enacted, and may in the future be enacted, to create liability for past actions
that were lawful at the time taken but that have been found to affect the
environment and to create public rights of action for environmental conditions
and activities. As is the case with scrap processors in general, if damage to
persons or the environment has been caused, or is in the future caused, by
hazardous materials activities of EMCO or other Company subsidiaries or by
hazardous substances now or hereafter located at any subsidiaries' facilities,
the Company and such subsidiaries may be fined and held liable for such damage.
In addition, the Company and such subsidiaries may be required to remedy such
conditions or change procedures. While the Company believes EMCO is in material
compliance with currently applicable environmental regulations and does not
anticipate any substantial capital expenditures for new environmental control
facilities during fiscal 1996, there can be no assurance that potential
liabilities, expenditures, fines and penalties associated with environmental
laws and regulations will not have a material adverse effect on the Company.
VOLATILITY OF STOCK PRICE
The Company's stock price has been, and in the future is expected to
be, volatile and to experience market fluctuation as a result of a number of
factors, including, but not limited to, current and anticipated results of
operations, future product offerings by the Company or its competitors and
factors unrelated to the operating performance of the Company. This volatility
may be increased as a result of the fact that by consummating the recent Merger,
the Company has entered into a new business market. The trading price of the
Company's Common Stock may also vary as a result of changes in the business,
operations, or financial results of the Company, prospects of general market and
economic conditions, additional future proposed acquisitions by the Company and
other factors.
FLUCTUATIONS IN OPERATING RESULTS
The Company's future operating results could be subject to significant
volatility, particularly on a quarterly basis. The Company's revenues and
operating results have fluctuated in the past and are likely to do so in the
future. The Company's quarterly operating results may continue to fluctuate due
to numerous factors, including but not limited to the demand for scrap metal,
the health of the national economy and competition.
EMCO has recently required cash infusions from the Company due to what
it believes to be short-term liquidity requirements; there can be no assurance,
however, that liquidity constraints will not continue or worsen. From February
1996 through March 1996, EMCO's margins declined over the results noted in the
Company's Definitive Joint Proxy Statement dated March 8, 1996, filed with the
Commission, but such margins ceased declining in April and May 1996. As a result
of the above and increased interest expense, EMCO's operating results for the
period from February 1, 1996, through April 30, 1996, declined from the pro
forma information contained in the Proxy Statement dated March 8, 1996.
RECENT CHANGES IN MANAGEMENT OF THE COMPANY
The Company has undergone multiple changes in its management in the
past year. Most recently, certain EMCO representatives were appointed Company
directors and/or officers in conjunction with the Merger. On April 9, 1996,
Donald F. Moorehead, then a director of EMCO, was elected to the Company's Board
of Directors. Immediately following the Merger, George O. Moorehead, Harold
Rubenstein and Raymond F. Zack, all officers and/or directors of EMCO, were
appointed to the Board of the Company. Also in conjunction with the Merger,
George O. Moorehead was appointed Executive Vice President of the Company.
On July 17, 1995, Herbert B. Baskin, then the President, Chief
Executive Officer and Chairman of the Board of Directors of the Company (then
called GPC), sold an aggregate of 1,400,000 shares of Common Stock
-9-
<PAGE> 11
of the Company to Gerard M. Jacobs, T. Benjamin Jennings, Donald F. Moorehead
and Blue Bird Partners (the "Purchasers") at a price of $2.00 per share, for a
total purchase price of $2,800,000, pursuant to a Common Stock Purchase
Agreement among Mr. Baskin and the Purchasers dated July 7, 1995. On July 24,
1995, a group consisting of Messrs. Jacobs and Jennings and Blue Bird Partners
delivered a written request to the Company to hold a Special Meeting of
Stockholders on August 30, 1995, in order to propose the removal of four out of
the five then-elected directors and to elect four replacement directors chosen
by the group. As required by the Company's bylaws, the Company called the
Special Meeting for such date and such purpose. At the completion of a Board
meeting held on July 27, 1995, two members of the Board, J. Thomas Bentley and
Luther J. Nussbaum, resigned from their positions as directors. At the
stockholders' meeting on August 30, 1995, the group's slate of four directors
was elected. On October 11, 1995, Eugene Sanders resigned his position as an
employee and director of the Company. On January 4, 1996, Louis D. Paolino
resigned his position as director of the Company.
In conjunction with the resignation of Mr. Paolino, Blue Bird Partners
has entered into an agreement to sell 250,000 of its shares of the Company to a
group of investors, including Messrs. Jennings and Jacobs, Harold Rubenstein,
Donald F. Moorehead, George O. Moorehead, and Charles R. McCurdy, at a purchase
price of $3.20 per share. In connection therewith, Blue Bird Partners granted
Messrs. Jennings and Jacobs a proxy to vote Blue Bird Partners' shares in favor
of the Merger and other items acted upon at the Company's April 9, 1996, annual
meeting.
Certain members of the current Board and management have little
experience in the scrap metal processing business. Certain others have little
experience in managing high-technology operations. These difficulties may be
exacerbated by the fact that certain key executives of the Company are working
out of different locations.
RESTRUCTURING OF PREVIOUS PRODUCT LINES
The Company in the past year has discontinued certain of its multimedia
products that were research and development-intensive, in an attempt to refocus
its operations. In October 31, 1995, the Company elected to discontinue a
portion of its electronic presentation products, including VideoShow, VideoShow
PRESENTER and related products, and recorded restructuring costs of $1,437,000.
Also in October 1995, the Company recorded a $716,000 special charge in Cost of
Sales for the repositioning of its color printer products. There can be no
assurance that the Company will not find it necessary or advisable in the future
to discontinue other existing products, which could result in further special
charges. The Company intends to identify and acquire completed color printer
products to sell under its own label, thereby reducing the need for significant
research and development, while supplementing necessary research and development
for its existing color thermal and dye sublimation product offerings through the
use of outside consultants and additional staff as required. The Company
believes that its future success will depend on its ability to continue to
enhance its existing products and to develop new products that meet specific
market needs in a cost-effective manner. There can be no assurance, however,
that the Company's efforts to identify and develop new products will result in
commercially successful products or that the Company's products will not be
rendered obsolete by changing technology. Moreover, the introduction of certain
enhanced or new products could cut into sales of existing products. Such
outcomes could adversely affect the Company's results of operations.
COMPETITIVE PRESSURES IN PRINTER AND CONSUMABLES MARKETS
The Company's net sales of printers and consumables for the two months
and five months ended March 31, 1996, declined 33.4% and 31.7%, respectively,
compared to the corresponding periods of the previous year. Gross profit
declined from 39.3% for the two months ended March 31, 1995, to 32.2% for the
corresponding period in 1996, and from 38.4% for the five months ended March 31,
1995, to 35.9% for the corresponding period in 1996. The decrease in net sales
was attributed to lower unit shipments for the Company's
-10-
<PAGE> 12
terminated electronic presentation products, lower unit shipments in the
Company's color printer line of products, and lower unit shipments in the
Company's consumables line of products. The decrease in gross profit was
attributable to lower per unit prices of color printers and consumables
resulting from increased competitive pressures and the inability to replace
higher-margin discontinued products with growth in the continuing product lines.
The decrease in net sales in the color printer line of products was attributable
to competitive product pressures in a market increasingly dominated by large,
well-known, strongly capitalized companies with the ability to spend
significantly more resources than the Company. There can be no assurance that
recent sharp revenue declines will not continue for the foreseeable future.
Competitors' introduction of new or enhanced products could reduce the Company's
sales of its existing products. Increased competitive pressures could cause the
Company to cut its prices further, which could have a material adverse impact on
gross margins and operating results. In addition, once the termination of the
VideoShow and VideoShow Presenter product lines is completed, overall Company
gross margins could decrease further.
SOLE-SOURCE SUPPLIERS
The Company's color printer and consumables operation principally uses
standard components from multiple vendors. However, in many of its products,
certain components are purchased from sole-source suppliers. The Company also
purchases some printer consumables from sole sources. There is no guarantee that
the supply of sole-source components and consumables from these suppliers, along
with any new, improved and lower-cost components, will continue to be made
available to the Company. The Company attempts to reduce the risk of
interruption in supply of components by maintaining adequate inventory. Loss or
interruption of the supply of components from sole-source suppliers would
require additional management and engineering efforts to develop and qualify
alternate sources, and any such loss could result in delays in product shipments
that could adversely affect the Company's results of operations.
EFFECT OF ANTITAKEOVER PROVISIONS OF DELAWARE LAW, THE COMPANY'S CHARTER
DOCUMENTS AND EMPLOYMENT AGREEMENTS
The Company is a corporation governed by the laws of Delaware. Certain
provisions of Delaware law and the charter documents of the Company may have the
effect of delaying, deferring or preventing changes in control or management of
the Company. Specifically, the Company's Board of Directors may issue shares of
Preferred Stock without stockholder approval on such terms as the Board may
determine. The rights of the holders of Common Stock of the Company are subject
to, and may be adversely affected by, the rights of any Preferred Stock that may
be issued in the future. The Company is subject to the provisions of Section 203
of the Delaware General Corporation Law, which has the effect of making changes
in control of a company more difficult. In connection with the Merger, the
Company entered into employment agreements with George O. Moorehead, Gerard M.
Jacobs and T. Benjamin Jennings. Such agreements provide for certain payments to
be made to such persons in the event of a change of control of the Company. The
effects of the antitakeover protections of Delaware law, the Company charter
documents and these employment agreements could be to make it more difficult for
a third party to acquire, or could discourage a third party from acquiring, a
majority of the outstanding stock of Company.
-11-
<PAGE> 13
SELLING STOCKHOLDER
The following table shows (i) the name of the Selling Stockholder, (ii)
the number of shares and percentage of Common Stock beneficially owned prior to
the sale of shares registered hereby, (iii) the aggregate number of shares of
Common Stock to be sold by it from time to time pursuant to this Prospectus, and
(iv) the number of shares and percentage beneficially owned after the sale of
all shares registered hereby:
<TABLE>
<CAPTION>
Shares Beneficially Shares to be Shares Beneficially
Owned Prior to Sold in the Owned After the
Name of Selling Shareholder Offering (2) Offering Offering (2)
- --------------------------- ------------------- ------------ -------------------
Number % Number %
------ - ------ -
<S> <C> <C> <C> <C> <C>
Copperstate Metals, Inc. (1) 1,205,587(3) 13% 300,000 905,587(3) 10%
</TABLE>
(1) In connection with its 1993 emergence from bankruptcy, the Selling
Stockholder contributed all of its assets and liabilities to EMCO
Recycling, L.L.C. EMCO Recycling, L.L.C., subsequently merged with EMCO
Recycling Corp. ("EMCO") in 1995. The Selling Stockholder then held
approximately 30% of the Common Stock of EMCO until April 11, 1996,
when EMCO became a wholly owned subsidiary of Metal Management, Inc.,
and the Selling Stockholder's EMCO shares were exchanged for shares of
Metal Management, Inc., Common Stock.
(2) Based on 8,844,653 shares of the Company's Common Stock outstanding as
of June 6, 1996, plus currently exercisable warrants held by the
Selling Stockholder to purchase 300,000 shares of Common Stock.
(3) As of June 6, 1996, the Selling Stockholder held 905,587 shares of
Common Stock, a warrant to purchase 180,000 shares of Common Stock at
$4.48 per share and a warrant to purchase 120,000 shares of Common
Stock at $6.48 per share. The warrants are presently exercisable in
full.
-12-
<PAGE> 14
PLAN OF DISTRIBUTION
The Company has been advised by the Selling Stockholder that it and any
person receiving shares from the Selling Stockholder in the form of a bona fide
gift (a "Donee") intend to sell all or a portion of the shares offered hereby
from time to time in the over-the-counter market, and that sales will be made at
prices prevailing in the market at the times of such sales. The Selling
Stockholder and any Donee may also make private sales directly or through a
broker or brokers, who may act as agent or as principal. In connection with any
sales, the Selling Stockholder, any Donee and any brokers participating in such
sales may be deemed to be "underwriters" within the meaning of the Securities
Act. The Company will receive no proceeds from sales made hereunder.
Any broker-dealer participating in such transactions as agent may
receive commissions from the Selling Stockholder and any Donee (and, if they act
as agent for the purchaser of such shares, from such purchaser). Usual and
customary brokerage fees will be paid by the Selling Stockholder and any Donee.
Broker-dealers may agree with the Selling Stockholder to sell a specified number
of shares at a stipulated price per share, and, to the extent such a
broker-dealer is unable to do so acting as agent for the Selling Stockholder and
any Donee, to purchase as principal any unsold shares at the price required to
fulfill the broker-dealer commitment to the Selling Stockholder and any Donee.
Broker-dealers who acquire shares as principal may thereafter resell such shares
from time to time in transactions (which may involve crosses and block
transactions and which may involve sales to and through other broker-dealers,
including transactions of the nature described above) in the over-the-counter
market, in negotiated transactions or otherwise at market prices prevailing at
the time of sale or at negotiated prices, and in connection with such resales
may pay to or receive from the purchasers of such shares commissions computed as
described above.
The Company has advised the Selling Stockholder that the
anti-manipulative Rules 10b-6 and 10b-7 under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), may apply to its sales in the market, has
furnished the Selling Stockholder with a copy of these Rules and has informed it
of the need for delivery of copies of this Prospectus. The Selling Stockholder
or any Donee may indemnify any broker-dealer that participates in transactions
involving the sale of the shares against certain liabilities, including
liabilities arising under the Securities Act. Any commissions paid or any
discounts or concessions allowed to any such broker-dealers, and any profits
received on the resale of such shares, may be deemed to be underwriting
discounts and commissions under the Securities Act if any such broker-dealers
purchase shares as principal.
Any securities covered by this Prospectus that qualify for sale
pursuant to Rule 144 under the Securities Act may be sold under that Rule rather
than pursuant to this Prospectus.
There can be no assurance that the Selling Stockholder or any Donee
will sell any or all of the shares of Common Stock offered by them hereunder.
-13-
<PAGE> 15
LEGAL MATTERS
Counsel for the Company, Wilson Sonsini Goodrich & Rosati, Professional
Corporation, 650 Page Mill Road, Palo Alto, California 94304, has rendered an
opinion to the effect that the Common Stock offered for resale hereby is duly
and validly issued, fully paid and non-assessable.
EXPERTS
The consolidated balance sheets of the Company as of October 31, 1995,
and 1994, and the related consolidated statements of operations, stockholders'
equity, and cash flows for each of the three years ended October 31, 1995, 1994,
and 1993, appearing in and incorporated by reference in the Company's Annual
Report on Form 10-K for the year ended October 31, 1995, and in the Definitive
Joint Proxy Statement of the Company and EMCO dated March 8, 1996, and
incorporated by reference in this Prospectus and Registration Statement on Form
S-3, have been audited by Price Waterhouse LLP, independent accountants, as
stated in their report dated December 4, 1995. The Consolidated Balance Sheet of
EMCO Recycling Corp. as of January 31, 1996, and the related consolidated
statements of income, stockholders' equity and cash flows for the ten months
ended January 31, 1996, appearing in the Company's Form 8-K/A filed June 20,
1996, and incorporated by reference thereto in this Prospectus and Registration
Statement on Form S-3, have been audited by Price Waterhouse LLP, independent
accountants, as stated in their report dated May 30, 1996. Such financial
statements have been incorporated in reliance on the reports of that firm given
upon the authority of that firm as experts in accounting and auditing.
The consolidated balance sheets of EMCO Recycling Corp. as of March 31,
1995, and 1994, and the related consolidated statements of income, stockholders'
equity and cash flows for the year ended March 31, 1995, and for the period from
inception (May 1, 1993) to March 31, 1994, included in the Definitive Joint
Proxy Statement of the Company and EMCO dated March 8, 1996, and incorporated by
reference in this Prospectus and Registration Statement on Form S-3, have been
audited by Arthur Andersen LLP, independent public accountants, as indicated in
their report dated August 11, 1995 (except with respect to the matter discussed
in Note 12, as to which the date is August 29, 1995), and are incorporated by
reference herein in reliance upon the authority of said firm as experts in
accounting and auditing in giving said reports.
-14-
<PAGE> 16
METAL MANAGEMENT, INC.
REGISTRATION STATEMENT ON FORM S-3
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
<TABLE>
<S> <C>
Registration fee--Securities and
Exchange Commission $ 459
Accounting fees $ 9,500*
Legal fees $ 7,500*
Transfer Agent fees $ 6,000*
Miscellaneous $ 541*
-------
Total $24,000
</TABLE>
*Estimates
The Company shall pay reasonable legal and accounting fees, filing and
registration fees of the Registration. The Selling Stockholder shall pay all
commissions, transfer taxes, and the fees and expenses of counsel to the Selling
Stockholder.
Item 15. Indemnification of Directors and Officers.
The Company has adopted provisions in its Certificate of Incorporation
that limit the liability of its directors and enable the Company to broaden the
indemnification provided to its directors and officers. As permitted by the
Delaware General Corporation Law, directors will not be liable for monetary
damages arising from a breach of their fiduciary duty as directors in certain
circumstances. Such limitation does not affect liability of a director to the
Company or its stockholders for (i) breaches of the director's duty of loyalty,
(ii) acts or omissions not in good faith or involving intentional misconduct or
knowing violations of law, (iii) the payment of unlawful dividends or unlawful
stock repurchases or redemptions or (iv) transactions in which the director
received an improper personal benefit. Such limitation of liability does not
affect the availability of equitable remedies such as injunctive relief or
rescission.
The Company's Bylaws provide that the Company shall indemnify its
directors and officers to the maximum extent permitted by Delaware law,
including circumstances in which indemnification is otherwise discretionary
under Delaware law. The Company has also entered into indemnification agreements
with its officers and
II-1
<PAGE> 17
directors containing provisions that are in some respects broader than the
specific indemnification provisions contained in the Delaware General
Corporation Law. The Indemnification Agreements may require the Company, among
other things, to indemnify such officers and directors against certain
liabilities that may arise by reason of their status or service as directors or
officers if they acted in good faith and in a manner they reasonably believed to
be in or not opposed to the best interests of the Company and, with respect to
any criminal proceeding, they had no reasonable cause to believe their conduct
was unlawful, to advance their expenses incurred as a result of any proceeding
against them as to which they could be indemnified, and to obtain directors' and
officers' insurance if available on reasonable terms.
The Company understands that the staff of the Securities and Exchange
Commission is of the opinion that statutory, charter and contractual provisions
as are described above have no effect on claims arising under the federal
securities laws. The Company is not aware of any material threatened or ongoing
litigation or proceeding that may result in a claim for such indemnification.
Item 16. Exhibits.
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<S> <C>
2.1 Merger Agreement dated as of December 1, 1995, and as amended
through March 7, 1996, among the Company, GPAR Merger, Inc.,
EMCO Recycling Corp. and the beneficial owners of EMCO's
Common Stock, appearing in the Definitive Joint Proxy Statement of
the Company and EMCO Recycling Corp., dated March 8, 1996, and
incorporated by reference herein.
5.1 Opinion of Wilson Sonsini Goodrich & Rosati
23.1 Consents of Independent Accountants (Price Waterhouse LLP)
23.2 Consent of Independent Public Accountants (Arthur Andersen LLP)
23.3 Consent of Wilson Sonsini Goodrich & Rosati (Included in Exhibit
5.1)
24.1 Power of Attorney (contained on Page II-4)
</TABLE>
Item 17. 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:
II-2
<PAGE> 18
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933, to the extent that the information required to be
included in a post-effective amendment is not contained in periodic reports
filed by the Registrant with or furnished to the SEC pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 and incorporated by
reference herein;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the Registration
Statement, to the extent that the information required to be included in the
post-effective amendment is not contained in periodic reports filed by the
Registrant with or furnished to the SEC pursuant to Section 13 or Section 15(d)
of the Securities Exchange Act of 1934 and incorporated by reference herein; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration Statement or
any material change 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, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in this 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.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised 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. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE> 19
SIGNATURES
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 Chicago, State of Illinois, on this 1st day of July
1996.
METAL MANAGEMENT, INC.
By: GERARD M. JACOBS
-------------------------------
Title: President, Chief Executive
Officer and Director
----------------------------
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Gerard M. Jacobs and T. Benjamin
Jennings, and either of them acting individually, as his attorney-in-fact, each
with full power of substitution, for him in any and all capacities, to sign any
and all amendments to this Registration Statement (including post-effective
amendments), to file any additional registration statement for the same offering
and amendments to the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming our signatures as they may be signed by our said
attorney to any and all amendments to said Registration Statement or statements,
and ratifying and confirming all that each of said attorneys-in-fact may do or
cause to be done by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT ON FORM S-3 HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN
THE CAPACITIES AND ON THE DATES INDICATED:
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Gerard M. Jacobs President, Chief Executive July 1, 1996
- ------------------------------------ Officer (Principal Executive
(Gerard M. Jacobs) Officer) and Director
/s/ T. Benjamin Jennings Chairman of the Board of July 1, 1996
- ------------------------------------ Directors and Chief Development
(T. Benjamin Jennings) Officer
/s/ George O. Moorehead Executive Vice President July 1, 1996
- ------------------------------------ and Director
(George O. Moorehead)
/s/ Harold Rubenstein Director July 1, 1996
- ------------------------------------
(Harold Rubenstein)
/s/ Raymond F. Zack Director July 1, 1996
- ------------------------------------
(Raymond F. Zack)
/s/ Xavier Hermosillo Director July 1, 1996
- ------------------------------------
(Xavier Hermosillo)
/s/ Donald F. Moorehead Director July 1, 1996
- ------------------------------------
(Donald F. Moorehead)
/s/ William A. Spazante Vice President, Finance, and July 1, 1996
- ------------------------------------ Chief Financial Officer
(William A. Spazante) (Principal Financial and
Accounting Officer)
</TABLE>
II-4
<PAGE> 20
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION
<S> <C>
2.1 Merger Agreement dated as of December 1, 1995, and as
amended through March 7, 1996, among the Company, Sub, EMCO
and the beneficial owners of EMCO's Common Stock, appearing
in the Definitive Joint Proxy Statement of the Company and
EMCO, dated March 8, 1996, and incorporated by reference
herein.
5.1 Opinion of Wilson Sonsini Goodrich & Rosati
23.1 Consents of Independent Accountants (Price Waterhouse LLP)
23.2 Consent of Independent Public Accountants (Arthur Andersen
LLP)
23.3 Consent of Wilson Sonsini Goodrich & Rosati (Included in
Exhibit 5.1)
24.1 Power of Attorney (contained on Page II-4)
</TABLE>
II-5
<PAGE> 1
Exhibit 5.1
July 2, 1996
Metal Management, Inc.
1250 Ninth Street
Berkeley, CA 94710
RE: REGISTRATION STATEMENT ON FORM S-3
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-3 to be filed by
you with the Securities and Exchange Commission on or about July 2, 1996 (the
"Registration Statement") and the form of Prospectus included therein (the
"Prospectus"), in connection with the registration under the Securities Act of
1933, as amended, of 300,000 shares of your Common Stock (the "Shares") to be
sold by Copperstate Metals, Inc. (the "Selling Stockholder"). As your legal
counsel, we have examined the proceedings taken and proposed to be taken in
connection with the sale of the Shares by the Selling Stockholder in the manner
set forth in the Registration Statement in the section entitled "Plan of
Distribution."
It is our opinion that the Shares are, and following sale by the
Selling Stockholder pursuant to the Registration Statement will remain, legally
and validly issued, fully paid and nonassessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement and further consent to the use of our name wherever appearing in the
Registration Statement, including any Prospectus constituting a part hereof, and
any amendments thereto.
Very truly yours,
WILSON SONSINI GOODRICH & ROSATI
Professional Corporation
/s/ WILSON SONSINI GOODRICH & ROSATI
<PAGE> 1
Exhibit 23.1(a)
CONSENT OF
INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report
dated December 4, 1995 appearing on page 18 of Metal Management, Inc.'s
(formerly General Parametrics Corporation) Annual Report on Form 10-K for the
year ended October 31, 1995, and appearing on page F-2 of Metal Management,
Inc.'s Joint Proxy Statement dated March 8, 1996. We also consent to the
references to us under the heading "Experts" in such Prospectus.
/s/ PRICE WATERHOUSE LLP
Price Waterhouse LLP
San Jose, California
July 1, 1996
<PAGE> 1
Exhibit 23.1(b)
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of Metal
Management, Inc. of our report dated May 30, 1996 relating to the consolidated
financial statements of EMCO Recycling Corp. which appears in the Current
Report on Form 8-K/A of Metal Management, Inc. filed with the Securities and
Exchange Commission on June 20, 1996. We also consent to the references to us
under the heading "Experts" in such Prospectus.
/s/ PRICE WATERHOUSE LLP
Price Waterhouse LLP
Phoenix, Arizona
July 1, 1996
<PAGE> 1
Exhibit 23.2
CONSENT OF
INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report on the financial
statements of EMCO RECYCLING CORP. as of March 31, 1995 and 1994 and for the
year ended March 31, 1995 and the period from inception (May 1, 1993) to March
31, 1994, dated August 11, 1995 (except with respect to the matter discussed in
Note 12, as to which date is August 29, 1995), included in the Definitive
Joint Proxy Statement of General Parametrics Corporation and EMCO RECYCLING
CORP. dated March 8, 1996, and to all references to our firm included in this
registration statement.
/s/ Arthur Andersen LLP
Phoenix, Arizona
June 28, 1996
