<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 23, 1999
REGISTRATION NO. 333-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
METAL MANAGEMENT, INC.
(Exact name of registrant as specified in its charter)
(FOR CO-REGISTRANTS, SEE TABLE OF CO-REGISTRANTS ON THE FOLLOWING PAGE)
DELAWARE
(State or other jurisdiction of
incorporation or organization)
5090
(Primary Standard Industrial
Classification Number)
94-2835068
(I.R.S. Employer
Identification No.)
500 NORTH DEARBORN STREET, SUITE 405
CHICAGO, ILLINOIS 60610
(312) 645-0700
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
------------------------
DAVID A. CARPENTER
EXECUTIVE VICE PRESIDENT, ADMINISTRATION, LEGAL & REGULATORY AFFAIRS AND
SECRETARY
METAL MANAGEMENT, INC.
500 NORTH DEARBORN STREET, SUITE 405
CHICAGO, ILLINOIS 60610
(312) 645-0700
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
------------------------
COPY TO:
PAUL W. THEISS
MAYER, BROWN & PLATT
190 SOUTH LASALLE STREET
CHICAGO, ILLINOIS 60603-3441
(312) 782-0600
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effectiveness of this registration statement.
If the securities being registered on this form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [ ]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act of 1933, 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 pursuant to Rule 462(d) under the
Securities Act of 1933, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same
offering. [ ]
- ------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
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PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO OFFERING PRICE AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED BE REGISTERED PER UNIT OFFERING PRICE REGISTRATION FEE
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<S> <C> <C> <C> <C>
12 3/4% Senior Secured Notes due 2004.............. $30,000,000 100% $30,000,000 $8,340
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Guarantees of 12 3/4% Senior Secured Notes due
2004............................................. $30,000,000 (2) (2) None
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</TABLE>
(1) Calculated based on the book value of the securities to be canceled by the
registrant in the exchange in accordance with Rule 457(f)(2) under the
Securities Act of 1933.
(2) Pursuant to Rule 457(n), no separate filing fee is required.
------------------------
THE CO-REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE CO-REGISTRANTS
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 THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SUCH SECTION 8(A), MAY DETERMINE.
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<PAGE> 2
TABLE OF CO-REGISTRANTS
<TABLE>
<CAPTION>
STATE OF PRIMARY STANDARD
INCORPORATION I.R.S. EMPLOYER INDUSTRIAL CLASSIFICATION
EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER OR ORGANIZATION IDENTIFICATION NO. CODE NUMBER
- ---------------------------------------------------- --------------- ------------------ -------------------------
<S> <C> <C> <C>
Aerospace Metals, Inc............................ Delaware 36-4201748 5090
American Scrap Processing, Inc................... Illinois 36-3197180 5090
California Metals Recycling, Inc................. California 95-3297588 5090
CIM Trucking, Inc................................ Illinois 36-4035047 5090
Cometco Corp..................................... Illinois 36-3199694 5090
Cozzi Building Corporation....................... Illinois 36-2588600 5090
Cozzi Iron & Metal, Inc.......................... Illinois 36-2582686 5090
C Shredding Corp................................. Illinois 36-3716605 5090
EMCO Trading, Inc................................ Arizona 86-0749343 5090
Ferrex Trading Corporation....................... Delaware 34-1627973 5090
FPX, Inc......................................... Tennessee 36-4259017 5090
Firma, Inc....................................... California 95-3876436 5090
Firma Plastic Co., Inc........................... California 95-4316294 5090
Houston Compressed Steel Corp.................... Texas 74-0693472 5090
HouTex Metals Company, Inc....................... Texas 74-2069895 5090
The Isaac Corporation............................ Ohio 34-0901723 5090
Kankakee Scrap Corporation....................... Illinois 36-2657218 5090
Kimerling Acquisition Corp....................... Delaware 36-4218674 5090
Mac Leod Metals Co............................... California 95-2588260 5090
Metal Management Arizona, Inc.................... Arizona 86-0730945 5090
Metal Management Gulf Coast, Inc................. Delaware 76-0570379 5090
Metal Management Pittsburgh, Inc................. Delaware 15-5369538 5090
Metal Management Realty, Inc..................... Arizona 74-2783185 5090
Michael Schiavone & Sons, Inc.................... Delaware 06-1516622 5090
Naporano Iron & Metal Co......................... New Jersey 22-1449923 5090
Newell Recycling West, Inc....................... Colorado 84-0888787 5090
NIMCO Shredding Co............................... New Jersey 22-1986545 5090
138 Scrap, Inc................................... Illinois 36-4226684 5090
PerlCo, L.L.C.................................... Tennessee 62-1600547 5090
P. Joseph Iron & Metal, Inc...................... Ohio 34-1655550 5090
Proler Southwest Inc............................. Texas 76-0378431 5090
Proler Steelworks L.L.C.......................... Delaware 64-0850641 5090
R&P Holdings, Inc................................ Delaware 25-1619177 5090
Reserve Iron & Metal Limited Partnership......... Delaware 34-1658201 5090
Salt River Recycling, L.L.C...................... Arizona 86-0819529 5090
Scrap Processing, Inc............................ Illinois 36-3588940 5090
Torrington Scrap Company......................... Delaware 06-1516623 5090
Trojan Trading Co................................ California 95-4327581 5090
USA Southwestern Carrier, Inc.................... Arizona 86-0749056 5090
</TABLE>
<PAGE> 3
-------------------------
C/O METAL MANAGEMENT, INC.
500 NORTH DEARBORN STREET, SUITE 405
CHICAGO, ILLINOIS 60610
(312) 645-0700
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
-------------------------
DAVID A. CARPENTER
EXECUTIVE VICE PRESIDENT, ADMINISTRATION, LEGAL & REGULATORY AFFAIRS AND
SECRETARY
METAL MANAGEMENT, INC.
500 NORTH DEARBORN STREET, SUITE 405
CHICAGO, ILLINOIS 60610
(312) 645-0700
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
-------------------------
Copy to:
PAUL W. THEISS
MAYER, BROWN & PLATT
190 SOUTH LASALLE STREET
CHICAGO, ILLINOIS 60603-3441
(312) 782-0600
<PAGE> 4
THE INFORMATION IN THIS PROSPECTUS IS INCOMPLETE AND MAY BE CHANGED. WE MAY NOT
SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES
AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL
THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN
ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED JULY 23, 1999
PROSPECTUS
METAL MANAGEMENT, INC.
OFFER TO EXCHANGE UP TO $30,000,000 OF OUR
12 3/4% SENIOR SECURED NOTES DUE 2004
WHICH HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 FOR ALL OF OUR OUTSTANDING
12 3/4% SENIOR SECURED NOTES DUE 2004
-------------------------
MATERIAL TERMS OF THE EXCHANGE OFFER:
- The exchange offer expires at 5:00 p.m., New York City time, on
, 1999, unless extended.
- The exchange offer is subject only to the conditions that the exchange
offer will not violate any applicable law or any interpretation of
applicable law by the staff of the Securities and Exchange Commission.
- All outstanding notes that are validly tendered and not validly
withdrawn will be exchanged.
- Tenders of outstanding notes may be withdrawn at any time before 5:00
p.m., New York City time, on the expiration date of the exchange offer.
- The exchange of notes will not be a taxable exchange for U.S. federal
income tax purposes.
- We will not receive any proceeds from the exchange offer.
- The terms of the new notes to be issued are substantially identical to
your old notes, except that the new notes will not have transfer
restrictions and you will not have registration rights.
- There is no established trading market for the new notes, and we do not
intend to apply for listing of the new notes on any securities exchange.
THE SENIOR SECURED NOTES:
- Maturity: June 15, 2004.
- Interest Payment: semiannually in cash on June 15 and December 15,
commencing on December 15, 1999.
- Redemption: the new notes will be redeemable on or after June 15, 2000.
Holders of the new notes may also require us to redeem all or a part of
such holder's new notes upon certain asset sales or changes of control.
- Ranking: the new notes will be our senior obligations, ranking equally
with all of our existing and future unsubordinated debt and senior to
all of our existing and future subordinated debt.
- Guarantee: the new notes will be guaranteed by all of our significant
restricted subsidiaries.
- Security: the new notes and the guarantees will be secured by a second
priority lien on substantially all of our and our subsidiaries' personal
property, plant (to the extent it constitutes fixtures) and equipment
that secure our senior credit facility.
-------------------------
FOR A DISCUSSION OF FACTORS THAT YOU SHOULD CONSIDER BEFORE YOU PARTICIPATE
IN THE EXCHANGE OFFER, SEE "RISK FACTORS" BEGINNING ON PAGE 10 OF THIS
PROSPECTUS.
-------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL AND COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this prospectus is , 1999.
<PAGE> 5
TABLE OF CONTENTS
<TABLE>
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PAGE
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<S> <C>
Incorporation of Information by Reference................... i
Where You Can Find More Information......................... ii
Prospectus Summary.......................................... 1
Risk Factors................................................ 10
Forward-Looking Statements.................................. 21
Metal Management, Inc....................................... 21
The Exchange Offer.......................................... 22
Use of Proceeds............................................. 32
Capitalization.............................................. 33
Description of the Notes.................................... 34
Certain Federal Income Tax Consequences..................... 78
Plan of Distribution........................................ 85
Legal Matters............................................... 85
Experts..................................................... 85
</TABLE>
-------------------------
You should rely only on the information contained in or incorporated by
reference into this prospectus. We have not authorized any other person to
provide you with different or additional information. If anyone provides you
with different or additional information, you should not rely on it. The
information in this prospectus is accurate as of the date on the front cover.
The information we have filed and will file with the Securities and Exchange
Commission that is incorporated by reference into this prospectus is accurate as
of the filing date of those documents. Our business, financial condition,
results of operations and prospects may have changed since those dates and may
change again.
INCORPORATION OF INFORMATION BY REFERENCE
This prospectus "incorporates by reference" important business and
financial information about our company that is not included in or delivered
with the prospectus. This means:
- incorporated documents are considered part of this prospectus;
- we can disclose important information to you by referring you to those
documents; and
- information that we file with the Securities and Exchange Commission will
automatically update and supersede this prospectus.
The following documents are incorporated into this prospectus by reference:
- our Annual Report on Form 10-K, and amended Annual Report on Form 10-K/A,
for the fiscal year ended March 31, 1999;
- our Current Report on Form 8-K, dated April 16, 1999, relating to an
amendment to our senior credit facility;
- our Current Report on Form 8-K, dated May 7, 1999, relating to the
issuance of the old notes;
- our Current Report on Form 8-K, dated July 15, 1999, relating to the
resignation of T. Benjamin Jennings as our Chairman of the Board and
Chief Executive Officer; and
- all documents filed by us under Section 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 after the date of this prospectus and
before the exchange offer is complete.
YOU MAY OBTAIN COPIES OF THE INFORMATION INCORPORATED BY REFERENCE INTO
THIS PROSPECTUS WITHOUT CHARGE UPON ORAL OR WRITTEN REQUEST TO: METAL
MANAGEMENT, INC.; ATTENTION: CORPORATE SECRETARY; 500 NORTH DEARBORN STREET,
SUITE 405, CHICAGO, ILLINOIS, 60610; TELEPHONE: (312) 645-0700.
i
<PAGE> 6
TO OBTAIN TIMELY DELIVERY OF ANY OF THIS INFORMATION, YOU MUST MAKE YOUR
REQUEST AT LEAST FIVE BUSINESS DAYS PRIOR TO THE EXPIRATION OF THE EXCHANGE
OFFER. YOU MUST MAKE YOUR REQUEST BY , 1999.
WHERE YOU CAN FIND MORE INFORMATION
You may read and copy the reports, statements and other information we file
with the Securities and Exchange Commission at the Securities and Exchange
Commission's public reference room at 450 Fifth Street, N.W., Washington, D.C.
20549. You can request copies of these documents by writing to the Securities
and Exchange Commission but must pay photocopying fees. Please call the
Securities and Exchange Commission at 1-800-SEC-0330 for further information on
the operation of the public reference rooms. Our Securities and Exchange
Commission filings are also available to the public on the Securities and
Exchange Commission's Internet site (http://www.sec.gov). These documents and
other information about our company that we file with the Securities Exchange
Commission are also available for viewing at the offices of The NASDAQ Stock
Market, 1735 K Street, NW, Washington, D.C. 20006.
ii
<PAGE> 7
PROSPECTUS SUMMARY
This summary contains basic information about this exchange offer. This
summary does not contain all of the information that may be important to you in
deciding whether to participate in the exchange offer. We encourage you to read
the entire prospectus, including the information described under the heading
"Risk Factors," and the business and financial information incorporated by
reference into this prospectus before you participate in the exchange offer.
Unless the context otherwise requires, references to "Metal Management," "we,"
"our," "us" and other similar terms are to Metal Management, Inc. and its
consolidated subsidiaries.
THE EXCHANGE OFFER
We sold $30.0 million of our 12 3/4% Senior Secured Notes due 2004 to the
initial purchaser on May 7, 1999. The initial purchaser resold those notes in
reliance on Rule 144A under the Securities Act of 1933.
We entered into a registration rights agreement with the initial purchaser
on May 7, 1999 in which we agreed, among other things, to:
- file a registration statement with the Securities and Exchange Commission
relating to the exchange offer on or before August 5, 1999;
- deliver to you this prospectus;
- cause the registration statement, which includes this prospectus, to
become effective on or before November 8, 1999; and
- keep the exchange offer open for acceptance for at least 25 business days
after notice of the exchange offer is mailed to holders of the old notes.
You are entitled to exchange your old notes for new registered 12 3/4%
Senior Secured Notes due 2004 with substantially identical terms as the old
notes, except for transfer restrictions and registration rights. If we do not
complete the exchange offer on or before December 15, 1999, the interest rate on
your notes will be increased. You should read the discussion under the heading
"The Exchange Offer--Purpose and Effect; Registration Rights" and "Description
of the Notes" for further information regarding the new notes that we are
offering in exchange for your old notes.
We believe that you may resell the new notes issued in the exchange offer
without compliance with the registration and prospectus delivery provisions of
the Securities Act of 1933, subject to the conditions described under "The
Exchange Offer." You should read that section for further information regarding
the exchange offer.
METAL MANAGEMENT, INC.
We are one of the largest and fastest-growing full-service metals recyclers
in the United States, with approximately 50 recycling facilities in 15 states.
We also own a 28.5% interest in Southern Recycling, L.L.C., the largest scrap
metal recycler in the Gulf Coast region. We are a leading consolidator in the
metals recycling industry. We have achieved our leading position in the metals
recycling industry primarily by implementing a national strategy of completing
and integrating regional acquisitions. We believe that our consolidation
strategy will enhance the competitive position and profitability of the
operations we acquire through the use of improved managerial and financial
resources and increased economies of scale. Our principal executive office is
located at 500 North Dearborn Street, Suite 405, Chicago, Illinois 60610. Our
telephone number is (312) 645-0700.
RECENT DEVELOPMENTS
Effective as of July 15, 1999, T. Benjamin Jennings resigned as our
Chairman of the Board and Chief Executive Officer in order to pursue other
personal and business interests. Mr. Jennings also resigned as one of our
directors.
1
<PAGE> 8
TERMS OF THE EXCHANGE OFFER
The exchange offer relates to the exchange of up to $30.0 million aggregate
principal amount of old notes for an equal aggregate principal amount of
registered new notes. The new notes will be obligations of Metal Management and
will be governed by the same indenture that governs the old notes.
New Notes.................. We are offering registered 12 3/4% Senior Secured
Notes due 2004 for your notes. The terms of the new
notes and your old notes are substantially
identical, except:
- the new notes will be registered under the
Securities Act of 1933;
- the new notes will not bear any legends
restricting transfer; and
- except under limited circumstances, your rights
under the registration rights agreement,
including your right to receive additional
interest, will terminate.
The Exchange Offer......... We are offering to exchange $1,000 in principal
amount of the new notes for each $1,000 in
principal amount of your old notes. As of the date
of this prospectus, $30.0 million aggregate
principal amount of the old notes is outstanding.
Expiration Date............ You have until 5:00 p.m., New York City time, on
, 1999 to validly tender your old notes
if you want to exchange your old notes for new
notes. We may extend that date under certain
conditions.
Conditions of the Exchange
Offer; Extensions;
Amendments................. You are not required to tender any minimum
principal amount of your old notes in order to
participate in the exchange offer. If you validly
tender and do not validly withdraw your old notes,
your old notes will be exchanged for new notes as
long as the exchange offer does not violate any
applicable law or any interpretation of applicable
law by the staff of the Securities and Exchange
Commission.
We may delay or extend the exchange offer and, if
either of the above conditions is not met, we may
terminate the exchange offer. We will notify you of
any delay, extension or termination of the exchange
offer.
We may also waive any condition or amend the terms
of the exchange offer. If we materially amend the
exchange offer, we will notify you.
Interest................... You will receive interest on the new notes from the
date interest was last paid on your old notes. If
no interest was paid on your old notes, you will
receive interest from May 7, 1999. If your old
notes are exchanged for new notes, you will not
receive any accrued interest on your old notes.
Procedures for Tendering
Old Notes; Special
Procedures for Beneficial
Owners..................... If you want to participate in the exchange offer,
you must transmit a properly completed and signed
letter of transmittal, and all other documents
required by the letter of transmittal, to the
exchange agent. Please send these materials to the
exchange agent at the address set forth in the
accompanying letter of transmittal prior to 5:00
p.m., New York City time, on the expiration date.
You must also send one of the following:
- certificates for your old notes;
2
<PAGE> 9
- a timely confirmation of book-entry transfer of
your old notes into the exchange agent's account
at The Depository Trust Company; or
- the items required by the guaranteed delivery
procedures described below.
If you are a beneficial owner of your old notes and
your old notes are registered in the name of a
nominee, such as a broker, dealer, commercial bank
or trust company, and you wish to tender your old
notes in the exchange offer, you should instruct
your nominee to promptly tender the old notes on
your behalf.
If you are a beneficial owner and you want to
tender your old notes on your own behalf, you must,
before completing and executing the letter of
transmittal and delivering your old notes, make
appropriate arrangements to either register
ownership of your old notes in your name or obtain
a properly completed bond power from the registered
holder of your old notes.
By executing the letter of transmittal, you will
represent to us that:
- you are not our "affiliate" (as defined in Rule
405 under the Securities Act of 1933);
- you will acquire the new notes in the ordinary
course of your business;
- you are not a broker-dealer that acquired your
old notes directly from us in order to resell
them pursuant to Rule 144A under the Securities
Act of 1933 or any other available exemption
under the Securities Act of 1933;
- if you are a broker-dealer that acquired your old
notes as a result of market-making or other
trading activities, you will deliver a prospectus
in connection with any resale of new notes; and
- you are not participating, do not intend to
participate and have no arrangement or
understanding with any person to participate in
the distribution of the new notes.
If your old notes are not accepted for exchange for
any reason, we will return your old notes to you at
our expense.
Guaranteed Delivery
Procedures................. If you wish to tender your old notes and:
- your old notes are not immediately available;
- you are unable to deliver on time your old notes
or any other document that you are required to
deliver to the exchange agent; or
- you cannot complete the procedures for delivery
by book-entry transfer on time;
then you may tender your old notes according to the
guaranteed delivery procedures that are discussed
in the letter of transmittal and in "The Exchange
Offer--Guaranteed Delivery Procedures."
3
<PAGE> 10
Acceptance of Old Notes and
Delivery of New Notes...... We will accept all old notes that you have properly
tendered on time when all conditions of the
exchange offer are satisfied or waived. The new
notes will be delivered promptly after we accept
the old notes.
Withdrawal Rights.......... Tenders of old notes may be withdrawn at any time
prior to 5:00 p.m., New York City time, on the
expiration date.
The Exchange Agent......... Harris Trust and Savings Bank is the exchange
agent. Its address and telephone number are set
forth in "The Exchange Offer--The Exchange Agent;
Assistance."
Fees and Expenses.......... We will pay all expenses relating to the exchange
offer and compliance with the registration rights
agreement. We will also pay certain transfer taxes,
if applicable, relating to the exchange offer.
Resales of New Notes....... We believe that the new notes may be offered for
resale, resold and otherwise transferred by you
without further compliance with the registration
and prospectus delivery requirements of the
Securities Act of 1933 if:
- you are not our "affiliate" (as defined in Rule
405 under the Securities Act of 1933);
- you acquire the new notes in the ordinary course
of your business;
- you are not a broker-dealer that purchased old
notes from us to resell them pursuant to Rule
144A under the Securities Act of 1933 or any
other available exemption under the Securities
Act of 1933; and
- you are not participating, and have no
arrangement or understanding with any person to
participate, in a distribution (within the
meaning of the Securities Act of 1933) of the new
notes.
You should read the information under the heading
"The Exchange Offer--Resales of the New Notes" for
a more complete description of why we believe that
you can freely transfer new notes received in the
exchange offer without registration or delivery of
a prospectus.
All broker-dealers that are issued new notes for
their own accounts in exchange for old notes that
were acquired as a result of market-making or other
trading activities must acknowledge that they will
deliver a prospectus meeting the requirements of
the Securities Act of 1933 in connection with any
resale of the new notes. If you are a broker-dealer
and are required to deliver a prospectus, you may
use this prospectus for an offer to resell, a
resale or other transfer of the new notes.
Federal Income Tax
Consequences............... The issuance of the new notes will not constitute a
taxable exchange for U.S. federal income tax
purposes. You will not recognize any gain or loss
upon receipt of the new notes. See "Certain Federal
Income Tax Consequences."
Registration Rights
Agreement.................. In connection with the sale of the old notes, we
entered into a registration rights agreement with
the initial purchaser of the old notes that grants
the holders of the old notes registration rights.
As a result of making and consummating this
exchange offer, we will have
4
<PAGE> 11
fulfilled most of our obligations under the
registration rights agreement. If you do not tender
your old notes in the exchange offer, you will not
have any further registration rights under the
registration rights agreement or otherwise unless
you were not eligible to participate in the
exchange offer or do not receive freely
transferrable new notes in the exchange offer. See
"The Exchange Offer--Purpose and Effect;
Registration Rights."
CONSEQUENCES OF NOT EXCHANGING OLD NOTES
If you do not exchange your old notes for new notes in the exchange offer,
your old notes will continue to be subject to the restrictions on transfer
contained in the legend on the old notes. In general, the old notes may not be
offered or sold unless they are registered under the Securities Act of 1933.
However, you may offer or sell your old notes under an exemption from, or in a
transaction not subject to, the Securities Act of 1933 and applicable state
securities laws. We do not currently anticipate that we will register the old
notes under the Securities Act of 1933.
5
<PAGE> 12
DESCRIPTION OF THE NEW NOTES
Issuer..................... Metal Management, Inc.
Securities Offered......... $30,000,000 principal amount of 12 3/4% Senior
Secured Notes due 2004.
Maturity................... June 15, 2004.
Interest Rate.............. 12 3/4% per year (calculated using a 360-day year).
Interest Payment Dates..... June 15 and December 15, beginning on December 15,
1999. Interest will accrue from May 7, 1999.
Guarantees................. All of our significant restricted subsidiaries will
unconditionally guarantee the new notes. If we
create or acquire a new domestic subsidiary, it
will guarantee the new notes unless we designate
the subsidiary as an "unrestricted subsidiary"
under the indenture or the subsidiary does not have
significant assets.
Ranking.................... The new notes will be our senior obligations and
will rank equally in right of payment with all of
our existing and future unsubordinated debt, and
senior in right of payment to all of our existing
and future subordinated debt.
The guarantees by our subsidiaries will rank
equally in right of payment with all of their
existing and future unsubordinated debt and senior
in right of payment to all of their existing and
future subordinated debt.
The new notes and the guarantees will be
effectively subordinated to the debt under our
senior credit facility due to the noteholders'
junior lien on our and our subsidiaries' assets
that secure the new notes and the senior credit
facility. In addition, debt under our senior credit
facility is secured by substantially all of our
real property, which does not currently secure the
new notes and, thus, the holders of the new notes
will have no direct claim to that real property.
As of March 31, 1999, we and our subsidiaries:
- had approximately $335.5 million of debt
outstanding,
-- including approximately $144.4 million of debt
under our senior credit facility (excluding
approximately $5.4 million of outstanding
letters of credit), and
-- excluding approximately $22.5 million that we
had available to borrow under our senior
credit facility on that date.
Security................... The new notes and the guarantees will be secured by
a second priority lien, subject to certain
exceptions, on substantially all of our and our
subsidiaries' personal property, plant (to the
extent it constitutes fixtures) and equipment that
from time to time secure our senior credit
facility. The liens securing the new notes and the
subsidiary guarantees will be subordinated to the
liens securing the senior credit facility.
To the extent collateral is released under the
senior credit facility, the holders of the new
notes will be required to release their security
interest in the same collateral. Therefore, if at
any time all of the
6
<PAGE> 13
collateral securing the senior credit facility is
released or the senior credit facility ceases to be
in effect, the new notes and the guarantees will
become our and our subsidiaries' unsecured
obligations.
Optional Redemption........ On or after June 15, 2000, we may redeem some or
all of the new notes (in multiples of $10 million)
at a redemption price equal to 100% of their
principal amount, plus accrued and unpaid interest.
Change of Control.......... If we experience a change of control, we must offer
to repurchase the new notes at 101% of their
principal amount, plus accrued and unpaid interest.
Asset Sale Proceeds........ If we or our restricted subsidiaries engage in
asset sales, we generally must invest the net cash
proceeds from those sales in our business or prepay
our senior credit facility (or other debt) or make
an offer to purchase a principal amount of the new
notes equal to the net cash proceeds remaining
after those investments and prepayments. The
purchase price of the new notes will be 100% of
their principal amount, plus accrued and unpaid
interest.
Certain Indenture
Provisions................. The indenture governing the new notes will contain
covenants limiting our (and our restricted
subsidiaries') ability to:
- incur additional debt;
- pay dividends or distributions on our capital
stock or repurchase our capital stock;
- issue stock of subsidiaries;
- make certain investments;
- create liens on our assets;
- enter into transactions with affiliates;
- merge or consolidate with another company; and
- transfer and sell assets or enter into sale and
leaseback transactions.
These covenants are subject to a number of
important limitations and exceptions. See
"Description of the Notes--Certain Covenants."
7
<PAGE> 14
SELECTED HISTORICAL AND PRO FORMA FINANCIAL DATA
The following table sets forth our selected historical and pro forma
consolidated financial data for the periods indicated. The historical data has
been restated to reflect the merger with R&P Holdings, Inc., otherwise known as
the Bluestone merger, as a pooling-of-interests. The historical financial data
included in the table below reflect the results of our prior operations of
designing, manufacturing and marketing electronic presentation products and
color printers and related consumable products as discontinued operations. We
sold the assets relating to these operations in July and December 1996.
<TABLE>
<CAPTION>
FISCAL YEARS FIVE MONTHS
ENDED ENDED FISCAL YEARS
OCTOBER 31, MARCH 31, ENDED MARCH 31,
--------------- ----------- --------------------------
1994 1995 1996 1997 1998 1999
---- ---- ---- ---- ---- ----
(IN MILLIONS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Net sales.............................................. $64.8 $112.8 $ 36.3 $141.8 $570.0 $805.3
Gross profit........................................... 3.5 7.8 1.4 11.4 52.1 65.2
General and administrative expenses.................... 2.0 6.3 2.3 10.4 28.2 56.4
Depreciation and amortization.......................... 0.1 0.1 0.1 2.5 10.1 25.6
Non-cash and non-recurring expenses(1)................. 0.0 0.0 0.0 0.0 43.5 16.2
Operating income (loss) from continuing operations..... 1.4 1.4 (1.0) (1.5) (29.7) (33.0)
Interest expense....................................... 0.4 1.2 0.5 2.3 10.0 31.3
Income (loss) from continuing operations............... 1.9 1.1 (0.9) (2.1) (34.4) (47.0)
Income (loss) from discontinued operations............. (0.4) (2.7) 0.0 0.8 0.2 0.1
Extraordinary charge(2)................................ 0.0 0.0 0.0 0.0 0.0 0.9
Preferred stock dividends(3)........................... 0.0 0.0 0.0 0.0 7.1 1.8
Net income (loss) applicable to common stock........... 1.5 (1.6) (0.9) (1.3) (41.3) (49.7)
Income (loss) from continuing operations applicable to
common stock:
Basic................................................ $0.31 $ 0.18 $(0.15) $(0.21) $(2.00) $(1.22)
Diluted.............................................. $0.31 $ 0.18 $(0.15) $(0.21) $(2.00) $(1.22)
Cash dividends per common share...................... $0.20 $ 0.15 $ 0.00 $ 0.00 $ 0.00 $ 0.00
OTHER FINANCIAL DATA:
Adjusted EBITDA(4)..................................... $ 1.5 $ 1.5 $ (0.9) $ 1.0 $ 23.9 $ 8.8
Ratio of earnings to fixed charges(5).................. 5.4 2.5 -- -- -- --
BALANCE SHEET DATA:
Working capital (deficit).............................. $10.7 $ 11.1 $ 11.1 $ (9.7) $101.6 $ 85.9
Total assets........................................... 30.6 39.1 31.7 94.7 497.2 667.7
Total debt (including current maturities).............. 8.1 17.6 11.6 48.1 151.5 335.5
Convertible preferred stock............................ 0.0 0.0 0.0 0.0 33.0 20.0
Common stockholders' equity............................ 15.8 12.6 12.4 27.2 215.4 219.2
UNAUDITED PRO FORMA FINANCIAL DATA(6):
Interest expense....................................... N/A N/A N/A N/A N/A $ 34.1
Loss from continuing operations applicable to common
stock................................................ N/A N/A N/A N/A N/A $(50.9)
Loss from continuing operations applicable to common
stock:
Basic................................................ N/A N/A N/A N/A N/A $(1.27)
Diluted.............................................. N/A N/A N/A N/A N/A $(1.27)
Total debt (including current maturities).............. N/A N/A N/A N/A N/A 337.0
</TABLE>
8
<PAGE> 15
- ---------------
(1) Non-cash and non-recurring expenses of $43.5 million for fiscal 1998
consisted of non-cash warrant compensation expense of $30.6 million and
facility abandonment, shut-down and integration charges of $12.9 million.
Non-cash and non-recurring expenses of $16.2 million for fiscal 1999
consisted of non-cash warrant compensation income of $6.8 million, merger
related costs of $3.2 million, loss on the Superior Forge, Inc. disposition
of $6.8 million and facility abandonment and integration charges of $13.0
million.
(2) Extraordinary charge in fiscal 1999 relates to prepayment penalties, fees,
and other costs incurred to refinance debt, net of related income tax
benefit.
(3) Fiscal 1998 amount includes a $5.6 million non-cash charge for the
beneficial conversion feature of the preferred stock.
(4) Adjusted EBITDA represents income from continuing operations plus interest
expense (including amortization of debt issuance costs), taxes, depreciation
and amortization. Adjusted EBITDA also excludes historical non-cash and
non-recurring expenses and other non-operating income and expenses. Adjusted
EBITDA is presented here to provide additional information about our ability
to meet our future debt service, capital expenditure and working capital
requirements. Adjusted EBITDA is not a measure of financial performance
under GAAP and should not be considered as an alternative either to net
income, as an indicator of our operating performance, or to cash flows, as a
measure of our liquidity. Items excluded from Adjusted EBITDA, such as
non-cash and non-recurring expenses, depreciation and amortization, are
significant components of our financial statements and should be considered
in assessing our financial performance. This definition of Adjusted EBITDA
may differ from similarly titled measures presented by other companies.
(5) For purposes of the computation, the ratio of earnings to fixed charges has
been calculated by dividing (i) pre-tax income (loss) from continuing
operations plus fixed charges by (ii) fixed charges. Fixed charges are equal
to interest expense plus the portion of the rent expense estimated to
represent interest expense. During the following periods, the deficiency of
earnings to fixed charges was as follows (in millions):
<TABLE>
<CAPTION>
FISCAL YEARS ENDED MARCH 31,
FIVE MONTHS ENDED -----------------------------
MARCH 31, 1996 1997 1998 1999
- ----------------- ---- ---- ----
<S> <C> <C> <C>
$1.6 $3.0 $38.9 $64.1
</TABLE>
(6) Pro forma interest expense, pro forma loss from continuing operations and
pro forma per share data reflect the incremental interest expense as a
result of the issuance of the old notes, as if the issuance of the old notes
had occurred on April 1, 1998. Pro forma total debt gives effect to the
issuance of the old notes and the application of the net proceeds therefrom,
as if the issuance of the old notes had occurred on March 31, 1999.
9
<PAGE> 16
RISK FACTORS
You should carefully consider the following risk factors, as well as the
other information contained in this prospectus, in connection with a decision to
tender your old notes in the exchange offer.
YOU MAY NOT BE ABLE TO SELL YOUR OLD NOTES IF YOU DO NOT EXCHANGE THEM FOR
REGISTERED NEW NOTES IN THE EXCHANGE OFFER.
If you do not exchange your old notes for new notes in the exchange offer,
your old notes will continue to be subject to the restrictions on transfer as
stated in the legend on the old notes. In general, you may not offer or sell the
old notes unless they are:
- registered under the Securities Act of 1933;
- offered or sold pursuant to an exemption from the Securities Act of 1933
and applicable state securities laws; or
- offered or sold in a transaction not subject to the Securities Act of
1933 and applicable state securities laws.
We do not currently anticipate that we will register the old notes under
the Securities Act of 1933. In addition, holders who do not tender their old
notes, except for certain instances involving the initial purchasers or holders
of old notes who are not eligible to participate in the exchange offer or who do
not receive freely transferrable new notes pursuant to the exchange offer, will
not have any further registration rights under the registration rights agreement
or otherwise and will not have rights to receive additional interest.
THE MARKET FOR OLD NOTES MAY BE SIGNIFICANTLY MORE LIMITED AFTER THE EXCHANGE
OFFER.
If old notes are tendered and accepted for exchange pursuant to the
exchange offer, the trading market for old notes that remain outstanding may be
significantly more limited. As a result, the liquidity of the old notes not
tendered for exchange may be adversely affected. The extent of the market for
old notes and the availability of price quotations would depend upon a number of
factors, including the number of holders of old notes remaining outstanding and
the interest of securities firms in maintaining a market in the old notes. An
issue of securities with a smaller number of units available for trading, which
is called the "float," may command a lower price than would a comparable issue
of securities with a greater float. Therefore, the market price for old notes
that are not exchanged may be lower as a result of the reduced float caused by
the exchange of old notes in the exchange offer. The trading price of the old
notes that are not exchanged may also become more volatile due to the reduced
float.
UNLESS OUR RESULTS OF OPERATIONS IMPROVE, WE MAY BE UNABLE TO SERVICE OUR
INDEBTEDNESS.
During the year ended March 31, 1999, we experienced losses of
approximately $50 million and were challenged to maintain adequate working
capital and to comply with the agreements governing our indebtedness. Since
September 30, 1998, we have entered into three amendments to our senior credit
facility to avoid the occurrence of events of default under that facility. If
our results of operations do not improve during the current fiscal year, we
could be unable to make interest payments on our indebtedness or may have
difficulty complying with financial debt covenants. In addition, there can be no
assurance that further amendments or waivers of defaults under our senior credit
facility would be available in the future if we were to default on our
indebtedness. In that event, we may be required to restructure our operations
and financial obligations. Based on our projections for the current fiscal year,
we believe that we will be able to meet maturing debt obligations as they become
due and comply with our financial and other debt covenants.
Our recent results of operations for the year ended March 31, 1999 were
negatively impacted by a dramatic and precipitous collapse in the domestic steel
industry and, in turn, the metals recycling industry. This resulted in a
significant decline in the price and demand for scrap metals. Although there has
been
10
<PAGE> 17
some improvement in the market conditions in the scrap metals industry since
January 1999, resulting in both improved demand and pricing for scrap metals, we
cannot assure you that this trend will continue to be sustained.
WE ARE HIGHLY LEVERAGED, WHICH COULD HAVE IMPORTANT NEGATIVE CONSEQUENCES TO THE
HOLDERS OF THE NEW NOTES.
We are highly leveraged. As of March 31, 1999, we had $335.5 million of
debt outstanding. For the year ended March 31, 1999, we had a deficiency in our
earnings to cover fixed charges in the amount of $64.1 million. Subject to
certain restrictions, exceptions and financial tests set forth in the indenture
governing our 10% Senior Subordinated Notes due 2008, the indenture governing
the new notes and in our senior credit facility, we may incur additional
indebtedness in the future. The degree to which we are leveraged could have
important negative consequences to the holders of the new notes, including the
following:
- we will have to use a substantial portion of our cash flow from
operations to pay debt service rather than for operations;
- our ability to obtain additional future financing for acquisitions,
capital expenditures, working capital or general corporate purposes could
be limited;
- we will have increased vulnerability to adverse general economic and
metals recycling industry conditions; and
- we may be vulnerable to higher interest rates because borrowings under
some of our credit arrangements are at variable rates of interest.
We can give you no assurance that our business will generate sufficient
cash flow from operations or that future working capital borrowings will be
available in an amount sufficient to enable us to service our indebtedness,
including the new notes, or make necessary capital expenditures.
IN CASE OF A DEFAULT, THERE MAY NOT BE SUFFICIENT COLLATERAL AVAILABLE TO
SATISFY OUR OBLIGATIONS UNDER THE NEW NOTES.
The new notes will be secured by a second priority lien, subject to certain
exceptions, on substantially all of our and our subsidiaries' personal property,
plant (to the extent it constitutes fixtures) and equipment that secures our
senior credit facility. The new notes and the guarantees are not currently
secured with the real property (to the extent it does not constitute fixtures)
that secures our senior credit facility. The liens securing the new notes will
be subordinate to the liens securing our senior credit facility. As of March 31,
we had $144.4 million of unsubordinated debt (excluding $5.4 million in
outstanding letters of credit under our senior credit facility and excluding
approximately $22.5 million of availability under our senior credit facility).
In the event there is a default and foreclosure on the collateral, the proceeds
from the sale of collateral may not be sufficient to satisfy our obligations
under the new notes, the indebtedness outstanding under our senior credit
facility and our other secured indebtedness. This is because proceeds from the
sale of the collateral would be distributed first to satisfy certain outstanding
secured obligations and then to satisfy all of our obligations under our senior
credit facility before they would be available for payment to holders of the new
notes. The holders of the new notes will not receive any proceeds from the sale
of collateral unless and until all indebtedness under our senior credit facility
is repaid in full. We have not prepared any appraisals of the collateral in
connection with the issuance of the new notes. By its nature, some or all of the
collateral will be illiquid and may have no readily ascertainable value.
Accordingly, we cannot assure you that all the collateral will be able to be
sold or that there will be sufficient funds available to repay the new notes
after payment in full of debt outstanding under our senior credit facility and
our other outstanding secured obligations. In addition, prior to the closing of
the offering of the old notes, the trustee for the notes and BT Commercial
Corporation, as the agent for our senior credit facility, entered into an
intercreditor agreement under which the lenders under our senior credit facility
have the exclusive right to dispose of, release or foreclose on or otherwise
deal with the collateral
11
<PAGE> 18
securing our senior credit facility and the new notes. As a result, the holders
of the new notes will not have the ability to make those decisions or in any way
ensure that sufficient collateral is securing the obligations of the holders of
the new notes. In addition, in the event all the collateral securing our senior
credit facility is released or our senior credit facility ceases to be in
effect, the collateral securing the new notes and the guarantees will be
released. See "Description of the Notes--Security" and "--Intercreditor
Agreement."
The new notes and the terms of the guarantees permit liens (in addition to
those under our senior credit facility). In addition, the priority of the liens
on a particular item of collateral securing the claims of the holders of the new
notes will be determined by, among other things, the time of perfection of a
security interest in that item of collateral. We have not conducted lien, tax or
judgment searches. As a result, we cannot assure you that the collateral is not
subject to other security rights, in addition to those under our senior credit
facility and those permitted by the terms of the new notes, which have priority
over the security rights granted to the trustee for the benefit of the holders
of the new notes. In the absence of those searches, you will be relying on our
belief that, except for liens permitted under the security documents for the new
notes, the collateral is not subject to any other security rights. Furthermore,
landlords', warehousemens' and materialmens' liens and some tax liens and liens
of some lenders, such as purchase money lenders, may, as a matter of law, have
priority over the liens granted in the collateral to the trustee for the new
notes. We cannot assure you that there are no prior liens or as to the extent of
those liens, if any.
OUR INDEBTEDNESS CONTAINS COVENANTS THAT RESTRICT OUR ABILITY TO ENGAGE IN
CERTAIN TRANSACTIONS.
Our senior credit facility, the indenture governing the 10% Senior
Subordinated Notes due 2008 and the indenture governing the new notes contain
covenants that, among other things, restrict our and our restricted
subsidiaries' ability to:
- incur additional indebtedness;
- pay dividends;
- prepay subordinated indebtedness;
- dispose of some types of assets;
- make capital expenditures;
- create liens and make some types of investments or acquisitions; and
- engage in some fundamental corporate transactions.
In addition, under our senior credit facility, we are required to satisfy
specified financial covenants, including an interest coverage ratio and ratio of
capital expenditures to consolidated revenues. Our ability to comply with these
provisions may be affected by general economic conditions, industry conditions,
and other events beyond our control. Our breach of any of these covenants could
result in a default under our senior credit facility. In the event of a default,
depending on the actions taken by the lenders under our senior credit facility,
the lenders could elect to declare all amounts borrowed under our senior credit
facility, together with accrued interest, to be due and payable. In addition, a
default under the indenture governing the new notes or the indenture governing
the 10% Senior Subordinated Notes due 2008 would constitute a default under our
senior credit facility and any instruments governing our other indebtedness.
Since September 30, 1998, due to the decline in our results of operations
described above, we have entered into three amendments to our senior credit
facility to avoid the occurrence of events of default under that facility. We
cannot assure you that further amendments or waivers of default under our senior
credit facility will be available in the future or that we will be able to
comply with the covenants under the agreements governing our indebtedness.
Both the indenture governing the 10% Senior Subordinated Notes due 2008 and
the indenture governing the new notes contain restrictions on our ability to
incur additional indebtedness, subject to
12
<PAGE> 19
certain exceptions, unless we meet a fixed charge coverage ratio of 2.0 to 1.0
for the immediately preceding four calendar quarters. Because of our recent
financial performance, we currently would not satisfy the fixed charge coverage
ratio test. Accordingly, we are unable, and will remain unable for the
foreseeable future, to incur significant amounts of additional indebtedness. As
a result, if we experience a liquidity shortfall, our ability to incur
additional indebtedness to cover the shortfall will be severely limited.
OUR INABILITY TO EFFECTIVELY MANAGE OUR GROWTH OR TO SUCCESSFULLY INTEGRATE NEW
BUSINESSES INTO OUR OPERATIONS WOULD HAVE A MATERIAL ADVERSE EFFECT ON OUR
RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
We intend to continue to actively pursue mergers and acquisitions. We
cannot assure you that we will be successful in acquiring other entities or that
we will be able to effectively manage those acquired entities. Our ability to
achieve our expansion objectives and to effectively manage our growth depends on
a variety of factors, including:
- our ability to identify appropriate acquisition targets and to negotiate
acceptable terms for their acquisition;
- the integration of new businesses into our operations;
- the achievement of cost savings; and
- the availability of capital.
Depending on the nature and size of these transactions, if any, we may
experience working capital and liquidity shortages. We cannot assure you that
additional financing will be available on terms and conditions acceptable to us,
if at all.
Due to the limited experience of management in implementing a consolidation
strategy on the scale we intend to pursue, we cannot assure you that we will be
able to successfully implement our consolidation strategy, even if we are able
to acquire other entities on acceptable terms and conditions. In addition, none
of our existing subsidiaries has significant experience operating as a
subsidiary of a public holding company subject to formal accounting and
reporting requirements. We will be required to continue to devote significant
management time and capital to enhance information systems and to improve and
monitor internal controls. We will also have to recruit managers with
appropriate skills to ensure the timeliness and accuracy of financial reports.
The success of our consolidation strategy depends in part on our ability to
oversee diverse operations and to successfully integrate processing, marketing
and other resources.
YOU SHOULD NOT CONSIDER PAST FINANCIAL PERFORMANCE AS A RELIABLE INDICATOR OF
FUTURE PERFORMANCE.
We have only recently entered the scrap metals recycling industry as of
April 1996. Accordingly, you should not consider past financial performance as a
reliable indicator of future performance. You should not use historical trends
to anticipate results or trends in future periods.
THE METALS RECYCLING INDUSTRY IS HIGHLY CYCLICAL WHICH MAY ADVERSELY AFFECT OUR
RESULTS OF OPERATIONS.
The operating results of the scrap metals recycling industry in general,
and our operations specifically, are highly cyclical in nature. They tend to
reflect and be amplified by general economic conditions, both domestically and
internationally. Historically, in periods of national recession or periods of
minimal economic growth, the operations of scrap metals recycling companies have
been materially and adversely affected. For example, 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. This leads to significant
fluctuations in demand and pricing for our products. Future economic downturns
in the national and international economy would likely negatively affect our
profitability and cash flows. Our ability to withstand significant economic
downturns in the future will depend, at least in part, upon our capital
availability and liquidity.
Our business can also be adversely affected by increases in steel imports
into the United States which generally have an adverse impact on domestic steel
production and a corresponding adverse impact on the
13
<PAGE> 20
demand for scrap metals. For example, beginning in July 1998, the domestic steel
industry and, in turn, the metals recycling industry suffered a dramatic and
precipitous collapse, resulting in a significant decline in the price and demand
for scrap metals. The decline in the steel and scrap metal sectors was due to,
in large part, the increase in steel imports flowing into the United States,
principally from Japanese and Southeast Asian steel producers during the last
six months of 1998. Our results of operations were adversely affected by these
factors.
PRICES OF COMMODITIES WE OWN MAY BE VOLATILE.
Although we have a policy of turning over our inventory of raw or processed
scrap metals as rapidly as possible, we are exposed to commodity price risk
during the period that we have title to products that are held in inventory for
processing and/or resale. Prices of commodities can be volatile due to numerous
factors beyond our control, including general economic conditions; labor costs;
competition; availability and relative pricing of scrap metal substitutes;
import duties; tariffs and currency exchange rates. In an increasing price
environment, competitive conditions may limit our ability to pass on price
increases to our customers. In a decreasing price environment, we may not have
the ability to fully recoup the cost of raw scrap we process and sell to our
customers. The lack of long-term purchase agreements with our significant
customers may exacerbate this risk.
WE MAY BE SUBJECT TO POTENTIAL ENVIRONMENTAL LIABILITY.
General. We are subject to potential liability and may also be required
from time to time to clean up or take certain remedial action with regard to
sites currently or formerly used in connection with our operations. Furthermore,
we may be required to pay for all or a portion of the costs to clean up or
remediate sites we never owned or operated if we are found to have arranged for
transportation, treatment or disposal of regulated substances on or to these
sites. We are also subject to potential liability for environmental damage that
our assets or operations may cause nearby landowners, particularly as a result
of any contamination of drinking water sources or soil, including damage
resulting from conditions existing prior to the acquisition of these assets or
operations. Any substantial liability for environmental damage could materially
adversely affect our operating results and financial condition.
Incompleteness of Site Investigations. As part of our pre-transaction "due
diligence" investigations, we typically hire an environmental consulting firm to
conduct pre-transaction screen reviews, or Phase I and/or Phase II site
assessments of the sites owned or leased by particular acquisition or merger
candidates. However, these pre-transaction reviews and site assessments have not
covered all of the sites owned or leased by the companies which are acquired by
us. Moreover, those pre-transaction reviews and site assessments which have
occurred have not been designed or expected (and will not in the future be
designed or expected) to disclose all material contamination or liability that
may be present. For example, we do not include soil sampling or core borings as
a standard part of these pre-transaction reviews and site assessments, even
though such sampling and core borings might increase the chances of finding
contamination on a particular site. Failure to conduct soil sampling and core
borings on a particular site could result in us failing to identify a seriously
contaminated site prior to an acquisition or merger.
Likelihood of Contamination at Some Sites. Pre-transaction reviews and
site assessments of our current sites conducted by independent environmental
consulting firms have revealed that some soil, surface water and/or groundwater
contamination, including various metals, arsenic, petrochemical byproducts,
waste oils, polychlorinated biphenyls, volatile organic compounds and baghouse
dust, is likely at certain of these sites, and have recommended that we conduct
additional investigations and remediation. Based on our review of these reports,
we believe that it is likely that contamination at varying levels exists at our
sites, and some of our sites will require additional investigation, monitoring
and remediation.
The ultimate extent of this contamination cannot be stated with any
certainty at this point, and we can give you no assurance that the cost of
remediation will be immaterial. The existence of this contamination could result
in federal, state, local or private enforcement or cost recovery actions against
14
<PAGE> 21
us, possibly resulting in disruption of our operations, the need for proactive
remedial measures, and substantial fines, penalties, damages, costs and expenses
being imposed against us.
We expect to require future cash outlays as we incur the actual costs
relating to the remediation of environmental liabilities. The incurrence of the
costs may have a material adverse effect on our results of operations and
financial condition. In this regard, we have established an overall reserve of
$2.2 million at March 31, 1999 for environmental liabilities that have been
identified and quantified.
Recommendations of Environmental Consultants. Our environmental
consultants have recommended that we take a variety of preventative and/or
remedial actions, including:
- the sampling of soil, surface and groundwater at its various facilities;
- the remediation of any existing contamination under applicable
regulations;
- the development of spill prevention control and countermeasure plans;
- the completion of certain actions in regard to storm water pollution
prevention plans;
- the completion and/or filing of certain annual reports and summaries
required by governmental agencies;
- the completion of oil discharge and response plans; and
- the remediation of certain materials suspected of containing asbestos.
If we fail to follow these recommendations, we may be subject to a
governmental enforcement action, the imposition of fines, penalties and damages,
and/or require remediation at some future time at a cost which may have a
material adverse effect on our results of operations and financial condition.
In connection with the acquisition of the assets of Aerospace, we have
identified certain on-site contamination which will require remediation in
accordance with a remediation plan prepared by an independent engineering firm.
The costs of this remediation will be paid by the seller of the assets of
Aerospace from an escrow fund established for such purpose out of the purchase
consideration we paid for these assets. Significant progress has been made to
date in implementing the remediation plan which we expect will be completed by
the end of the second quarter of the current fiscal year. However, until the
remediation is actually completed, and the completion certified by the
environmental consultant engaged to perform the remediation, we cannot assure
you that we will not be required to make significant expenditures to complete
the remediation.
Uncertain Costs of Environmental Compliance and Remediation. Many factors
affect the level of expenditures we will be required to make in the future to
comply with environmental requirements, including:
- new local, state and federal laws and regulations;
- the developing nature of administrative standards promulgated under the
Comprehensive Environmental Response, Compensation, and Liability Act of
1980, as amended ("Superfund"), and other environmental laws, and
changing interpretations of such laws;
- uncertainty regarding adequate control levels, testing and sampling
procedures, new pollution control technology and cost benefit analyses
based on market conditions;
- the incompleteness of information regarding the condition of certain
sites;
- the lack of standards and information for use in the apportionment of
remedial responsibilities;
- the numerous choices and costs associated with diverse technologies that
may be used in remedial actions at such sites;
- the possible ability to recover indemnification or contribution from
third parties; and
- the time periods over which eventual remediation may occur.
Lack of Environmental Impairment Insurance. In general, our subsidiaries
do not carry environmental impairment liability insurance. In general, our
subsidiaries operate under general liability insurance
15
<PAGE> 22
policies, which do not cover environmental damage. If one or more of our
subsidiaries were to incur significant liability for environmental damage not
covered by environmental impairment insurance, or for other claims in excess of
its general liability insurance and umbrella coverage, our results of operations
and financial condition could be materially adversely affected.
Risks Associated With Certain By-Products. Our scrap metals recycling
operations produce significant amounts of by-products. Heightened environmental
risk is associated with some of these by-products. For example, certain of our
subsidiaries operate shredders for which the primary feed materials are
automobile hulks and obsolete household appliances. Approximately 20% of the
weight of an automobile hulk consists of material, referred to as shredder
fluff, which remains after the segregation of ferrous and saleable non-ferrous
metals. Federal environmental regulations require testing or evaluation of
shredder fluff to avoid classification as a hazardous waste. We endeavor to have
hazardous contaminants from the feed material removed prior to shredding. In
general, our subsidiaries treat shredder fluff as a special non-hazardous waste.
If the shredder fluff is tested and determined to be hazardous, then it is
disposed of as a hazardous waste. If we are required to treat shredder fluff as
a hazardous waste, we may incur additional material expenditures for disposal or
treatment.
Potential Superfund Liability. Several of our subsidiaries have received
notices from the United States Environmental Protection Agency that each of
these companies and numerous other parties are considered potentially
responsible parties and may be obligated under Superfund to pay a portion of the
cost of remedial investigation, feasibility studies and, ultimately, remediation
to correct alleged releases of hazardous substances at various third party
sites. Superfund may impose joint and several liability for the costs of
remedial investigations and actions on the entities that arranged for disposal
of certain wastes, the waste transporters that selected the disposal sites, and
the owners and operators of these sites. Responsible parties (or any one of
them) may be required to bear all of such costs regardless of fault, legality of
the original disposal, or ownership of the disposal site. Based upon our
analysis of the situation, we currently do not expect the potential liability of
our subsidiaries in these matters to have a material adverse effect on our
financial condition or results of operation.
Underground Storage Tanks. Underground storage tanks exist at several of
our sites. At least one of these tanks may not yet comply with current
regulatory requirements. We do not believe that this lack of compliance will
result in a material liability. In the event a release of regulated product has
occurred, we may incur significant costs to investigate and remediate the
release.
Compliance History. We have, in the past, been found not to be in
compliance with certain environmental laws and regulations, and have incurred
fines associated with such violations which have not been material in amount and
may in the future incur additional fines associated with such violations. We
have also paid a portion of the costs of certain remediation actions at certain
sites. We cannot assure you that we will avoid material fines, penalties,
damages and expenses resulting from additional compliance issues and liabilities
in the future.
WE HAVE BEEN FINED BY OSHA AND MAY BE SIMILARLY FINED IN THE FUTURE.
Our operations are subject to regulation by federal, state and local
agencies responsible for employee health and safety, including the Occupational
Safety and Health Administration. Five accidental employee deaths, and a number
of serious accidental injuries, have occurred at our subsidiaries during the
past four years. We have been fined in regard to some of these incidents. We
cannot assure you that we will be able to avoid material liabilities for any
employee death or injury that may occur in the future or that these types of
incidents may not have a material adverse effect on our financial condition.
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THE NOTES OR THE GUARANTEES MAY BE UNENFORCEABLE DUE TO FRAUDULENT CONVEYANCE
STATUTES.
Under federal or state fraudulent conveyance statutes, if a court in a suit
by an unpaid creditor or a representative of creditors (such as a trustee in
bankruptcy or a debtor-in-possession) were to find that we:
- issued the notes with the intent of hindering, delaying or defrauding
current or future creditors, or
- did not receive fair consideration (or reasonably equivalent value) for
incurring the indebtedness represented by the notes and:
-- were insolvent at the time of, or were rendered insolvent by reason
of, the incurrence,
-- were engaged in a business or transaction for which our remaining
assets constituted unreasonably small capital, or
-- intended to incur, or believed that we would incur, debts beyond our
ability to pay at maturity,
then the court could, among other things:
- void all or a portion of our obligations to the noteholders, the effect
of which would be that the noteholders may not be repaid in full,
- recover all or a portion of the payments made to the noteholders and/or
- subordinate our obligations to the noteholders to our other existing and
future indebtedness, the effect of which would be to entitle such other
creditors to be paid in full before any payment could be made on the
notes.
Generally, a company is considered insolvent if:
- the sum of the company's debts is greater than all of the company's
property at a fair valuation, or
- the present fair saleable value of the company's assets is less than the
amount required to pay its probable liability on its existing debts as
they become due.
No solvency opinion was obtained in connection with the offering, nor will
one be obtained in connection with the exchange offer. We can give you no
assurance as to the standard a court would apply to determine whether we were
solvent at the relevant time or the likelihood that the new notes would be
voided on another of the grounds set forth above.
In addition, the obligations of the subsidiary guarantors may be subject to
challenge under federal or state fraudulent conveyance statutes. In that case,
the analysis set forth above would generally apply. However, the guarantees
could also be subject to the claim that, because they were incurred for our
benefit (and only indirectly for the benefit of the guarantors), the obligations
of the guarantors were incurred for less than reasonably equivalent value or
fair consideration. A court could void a guarantor's obligation under its
guarantee, subordinate the guarantee to other indebtedness of a guarantor or
take other action detrimental to the noteholders. If a court takes any action to
void or subordinate a guarantee, or to the extent that any of our subsidiaries
is not a guarantor, all claims by holders of other indebtedness against those
subsidiaries will need to be satisfied before funds will be available to us to
meet our obligations, including those under the new notes.
AS A HOLDING COMPANY, OUR ABILITY TO MEET OUR DEBT SERVICE OBLIGATIONS DEPENDS
UPON THE CASH FLOW OF OUR SUBSIDIARIES AND OUR ABILITY TO RECEIVE FUNDS FROM
THEM.
We are a holding company. Our subsidiaries conduct all of our consolidated
operations and own substantially all of our consolidated assets. Consequently,
our cash flow and our ability to meet our debt service obligations depend upon
our subsidiaries' cash flow and their payment of funds to us in the form of
loans, dividends or otherwise. Their ability to make any payments will depend
upon their earnings, the terms of their indebtedness, tax considerations and
legal restrictions. We can give you no assurance that those payments will be
sufficient in the future to meet our debt service obligations, including
payments on the new notes.
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WE MAY NOT BE ABLE TO NEGOTIATE FUTURE LABOR CONTRACTS ON FAVORABLE TERMS.
Many of our active employees are represented by various labor unions,
including the Teamsters Union, the United Steel Workers Union and the United
Auto Workers. As our agreements with those unions expire, we cannot assure you
that we will be able to negotiate extensions or replacements on terms favorable
to us, or at all, or that we will be able to avoid strikes, lockouts or other
labor actions from time to time. We cannot assure you that new labor agreements
will be reached with our unions as those labor contracts expire. Any labor
action resulting from the failure to reach an agreement with one of the unions
representing our employees may have a material adverse effect on us or our
results of operations.
WE MAY BE EFFECTIVELY CONTROLLED BY A GROUP OF STOCKHOLDERS WHO MAY USE THEIR
CONTROL IN A MANNER INCONSISTENT WITH THE INTERESTS OF THE HOLDERS OF THE NEW
NOTES.
We, Albert A. Cozzi, Frank J. Cozzi, Gregory P. Cozzi, T. Benjamin Jennings
and Samstock, L.L.C. are parties to a stockholders agreement. As of March 31,
1999, these stockholders owned approximately 28% of the issued and outstanding
shares of our common stock. Pursuant to the stockholders agreement, Messrs. A.
Cozzi, F. Cozzi and G. Cozzi can together nominate five persons for election to
our board of directors and Samstock can nominate one person for election to our
board of directors. The stockholders agreement obligates each of these
stockholders to vote for the election of the persons that are so nominated. As a
result of their shareholdings, these stockholders may be deemed to have
effective control over our affairs and management. We cannot assure you that
this influence will be used in a manner that is consistent with the interests of
the holders of the new notes.
Some decisions concerning our operations or financial structure may present
conflicts of interest between our stockholders and the holders of the new notes.
For example, if we encounter financial difficulties or are unable to pay our
debts as they become due, the interests of our stockholders might conflict with
those of the holders of the new notes. Our stockholders also may have an
interest in pursuing acquisitions, divestitures, financings or other
transactions that could enhance their equity investment, even though such
transactions might involve risk to the holders of the new notes. Because the
members of our senior management team are significant stockholders, any such
conflict of interest may be resolved in favor of our stockholders to the
detriment of the holders of the new notes.
THE LOSS OF ANY MEMBER OF OUR SENIOR MANAGEMENT TEAM OR A SIGNIFICANT NUMBER OF
OUR MANAGERS COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR OPERATIONS.
Our operations to date have depended in large part on the skills and
efforts of our senior management team, including Albert A. Cozzi, our Chairman
of the Board, President and Chief Operating Officer. In addition, we rely
substantially on the experience of the management of our subsidiaries with
regard to day-to-day operations. While we have employment agreements with Mr.
Cozzi and certain members of our management team at the subsidiary level, we
cannot assure you that we will be able to retain the services of any of those
individuals. The loss of any member of our senior management team or a
significant number of managers could have a material adverse effect on our
operations.
THE PROFITABILITY OF OUR SCRAP RECYCLING OPERATIONS DEPENDS, IN PART, UPON THE
AVAILABILITY OF AN ADEQUATE SOURCE OF SUPPLY.
We acquire our scrap inventory from numerous sources. These suppliers
generally are not bound by long-term contracts and have no obligation to
continue selling scrap materials to us. If a substantial number of scrap
suppliers cease selling scrap metals to us, our results of operations or
financial condition would be materially and adversely affected.
THE CONCENTRATION OF OUR CUSTOMERS AND OUR EXPOSURE TO CREDIT RISK COULD HAVE A
MATERIAL ADVERSE EFFECT ON OUR RESULTS OF OPERATIONS OR FINANCIAL CONDITION.
Our ten largest customers represented approximately 34.2% of consolidated
net sales for the year ended March 31, 1999. Accounts receivable balances from
these customers represented approximately
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34.0% of consolidated accounts receivable at March 31, 1999. The loss of any one
of these significant customers could adversely affect our results of operations
or financial condition.
In connection with the sale of our products, we generally do not require
collateral as security for customer receivables. Some of our subsidiaries have
significant balances owing from customers that operate in cyclical industries
and under leveraged conditions that may impair the collectibility of those
receivables. Failure to collect a significant portion of amounts due on those
receivables could have a material adverse effect on our results of operations or
financial condition.
WE FACE COMPETITION FROM OTHER PROVIDERS OF PROCESSED SCRAP AND PROCESSED SCRAP
SUBSTITUTES.
The metals recycling industry is highly competitive and subject to
significant changes in overall market conditions. We face potential competition
for sales of processed scrap from producers of steel products, such as
integrated steel mills and mini-mills, which may vertically integrate their
current operations by entering the scrap metals recycling business. Many of
these producers have substantially greater financial, marketing, and other
resources than we do. Scrap metals processors also face competition from
substitutes for prepared ferrous scrap, such as pre-reduced iron pellets, hot
briquetted iron, pig iron, iron carbide and other forms of processed iron. The
availability of substitutes for ferrous scrap could result in a decreased demand
for processed ferrous scrap, which could result in lower prices for such
products.
A SIGNIFICANT INCREASE IN THE USE OF SCRAP METALS ALTERNATIVES BY CURRENT
CONSUMERS OF PROCESSED SCRAP METALS COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR
RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
During periods of high demand for scrap metals a tightness can develop in
the supply and demand balance for ferrous scrap. The relative scarcity of
ferrous scrap, particularly the "cleaner" grades, and its high price during such
periods have created opportunities for producers of alternatives to scrap
metals. Although these alternatives have not been a major factor in the industry
to date, we cannot assure you that the use of alternatives to scrap metals will
not proliferate if the prices for scrap metals rise and if the levels of
available unprepared ferrous scrap decrease.
THERE IS NO ESTABLISHED TRADING MARKET FOR THE NEW NOTES.
The new notes will constitute a new class of public securities with no
established trading market. Although the new notes will generally be permitted
to be resold or otherwise transferred by nonaffiliates of Metal Management
without compliance with the registration requirements under the Securities Act
of 1933, we do not intend to apply for a listing of the new notes on any
securities exchange or to arrange for the new notes to be quoted on the NASDAQ
National Market or other quotation system. The initial purchaser has advised us
that it intends to make a market in the new notes; however, the initial
purchaser is not obligated to do so, and any market-making with respect to the
new notes may be discontinued at any time without notice. As a result, there can
be no assurance that an active trading market for the new notes will develop. If
a market were to develop, the new notes could trade at prices that may be lower
than the initial market values thereof depending on many factors, including
prevailing interest rates and the markets for similar securities.
WE MAY HAVE SIGNIFICANT COSTS RELATED TO YEAR 2000 COMPLIANCE.
A year 2000 problem arises because some existing computer programs
recognize only the last two digits rather than four digits to define the
applicable year. Use of non-year 2000 compliant programs can result in system
failures, miscalculations or errors causing disruptions of operations or other
business failures, including, a potential inability to process invoices or
transactions or engage in other normal business activities. As it relates to our
own internal systems, we believe that, as a result of our efforts to resolve
potential year 2000 problems, actual year 2000 problems affecting us should not
be material. We cannot assure you, however, that this will be the case. In
addition, the impact of year 2000 problems experienced by our vendors, customers
and service providers cannot accurately be assessed at this time. To the extent
these third parties are not year 2000 compliant, it could have a material
adverse effect on our
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operations. We are unable at this time to state our "worst case" year 2000
scenario. We are currently developing a contingency plan in the event of
noncompliance, which should be completed by the end of the second quarter of the
current fiscal year.
The Company has experienced tremendous growth as a result of having
completed 26 acquisitions since April 1996. Essentially all of the companies and
businesses the Company has acquired operated on separate computer hardware,
software, systems and processes ("Information Systems") before being acquired.
In order to address the potential year 2000 problem, among other
computer-related challenges facing the Company, in fiscal 1998, the Company
created an MIS Steering Committee. The MIS Steering Committee has developed a
plan for year 2000 compliance which includes four major phases -- assessment,
remediation, testing and implementation.
The Company has completed all of its assessment of the impact of the year
2000 problem on its Information Systems. Based on this assessment, the Company
does not expect the cost of making its Information Systems year 2000 compliant
to have a material adverse impact on its financial position or results of
operations in future periods. The Company has completed all of its remediation
phase for all of its significant Information Systems and estimates that it will
complete software upgrades and/or replacements by the end of the second quarter
of the current fiscal year. To date, the Company has completed approximately 93%
of its testing phase and has implemented approximately 73% of the required
remediation for its Information Systems. The testing and implementation phases
are targeted to be substantially complete by the end of the second quarter of
the current fiscal year.
The Company has substantially completed its assessment phase of the impact
of year 2000 problems on its non-information technology systems such as
telephones, processing equipment or other equipment containing embedded
technology such as microcontrollers ("Non-IT Systems"). As part of the
assessment, the Company has created an equipment inventory database of its
Non-IT Systems to help with the assessment. The Company believes that it will
substantially complete its remediation, testing and implementation phases for
Non-IT Systems by the end of the second quarter of the current fiscal year. The
Company does not expect the cost of making its Non-IT Systems year 2000
compliant to have a material adverse impact on its financial position or results
of operations in future periods.
The Company is in the process of identifying third parties, such as
suppliers, service providers and customers, with which it has a significant
relationship that, in the event of a year 2000 failure, could have a material
adverse impact on its financial position or results of operations. Once this
list is developed, the Company expects to send each of these third parties a
survey requesting information on its year 2000 readiness. Based on the responses
to these surveys, the Company will gauge the readiness of its suppliers, service
providers and customers for year 2000 and determine any appropriate action that
the Company will need to take to address identified concerns.
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FORWARD-LOOKING STATEMENTS
This prospectus includes or incorporates by reference forward-looking
statements as they are defined in the Securities Act of 1933 and the Securities
Exchange Act of 1934. We based these forward-looking statements on our current
expectations and our projections about future events. These forward-looking
statements could be negatively affected by risks, uncertainties and assumptions
about us, including, among other things:
- our future profitability;
- the benefits to be derived from the execution of our strategy; and
- other future developments in our affairs or in our industry.
All future written and oral forward-looking statements made by us or on our
behalf are also subject to these factors. We undertake no obligation to publicly
update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise. In light of these risks, uncertainties
and assumptions, the forward-looking events discussed in or incorporated by
reference into this prospectus might not occur.
METAL MANAGEMENT, INC.
We are one of the largest and fastest-growing full-service metals recyclers
in the United States, with approximately 50 recycling facilities in 15 states.
We also own a 28.5% interest in Southern Recycling, L.L.C., the largest scrap
metal recycler in the Gulf Coast region. We are a leading consolidator in the
metals recycling industry. We have achieved our leading position in the metals
recycling industry primarily by implementing a national strategy of completing
and integrating regional acquisitions. We believe that our consolidation
strategy will enhance the competitive position and profitability of the
operations we acquire through the use of improved managerial and financial
resources and increased economies of scale.
RECENT DEVELOPMENTS
Effective as of July 15, 1999, T. Benjamin Jennings resigned as our
Chairman of the Board and Chief Executive Officer in order to pursue other
personal and business interests. Mr. Jennings also resigned as one of our
directors.
We have commenced a nationwide search for a new Chief Executive Officer.
Following Mr. Jennings' resignation, Albert A. Cozzi, our President and Chief
Operating Officer, assumed the additional title of Chairman of the Board.
Pending the outcome of the search for a new Chief Executive Officer, the duties
of that office will be carried out by a four-member committee consisting of
Albert A. Cozzi, William T. Proler, the President of our Gulf Coast operations,
and Executive Vice Presidents George A. Isaac, III and David A. Carpenter. In
connection with Mr. Jennings' resignation, we and Mr. Jennings entered into a
severance agreement pursuant to which we agreed to provide Mr. Jennings with all
of the severance benefits to which he would have been entitled under his
employment agreement had we terminated him without cause.
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THE EXCHANGE OFFER
PURPOSE AND EFFECT; REGISTRATION RIGHTS
We sold the old notes to BT Alex. Brown Incorporated, as initial purchaser,
on May 7, 1999. The initial purchaser then resold the old notes pursuant to an
offering memorandum, dated May 5, 1999, in reliance upon Rule 144A under the
Securities Act of 1933. On May 7, 1999, we entered into a registration rights
agreement with the initial purchaser. Under the registration rights agreement,
we agreed to:
- file a registration statement with the Securities and Exchange Commission
relating to the exchange offer under the Securities Act of 1933 no later
than August 5, 1999;
- use our commercially reasonable efforts to cause the exchange offer
registration statement to be declared effective under the Securities Act
of 1933 on or before November 8, 1999;
- commence the exchange offer promptly after the exchange offer
registration statement is declared effective by the Securities and
Exchange Commission;
- use our commercially reasonable efforts to keep the exchange offer open
for acceptance for at least 25 business days after notice of the exchange
offer is mailed to holders of the old notes;
- use our commercially reasonable efforts to cause the exchange offer to be
consummated not later than December 15, 1999;
- use our commercially reasonable efforts to promptly issue new notes in
exchange for all old notes that have been properly tendered for exchange
prior to the expiration of the exchange offer; and
- use our commercially reasonable efforts to keep the exchange offer
registration statement effective until the closing of the exchange offer
and thereafter until we have issued new notes in exchange for all old
notes that have been properly tendered for exchange prior to the
expiration of the exchange offer.
In the registration rights agreement, we agreed to file a shelf
registration statement if:
- we are not permitted to effect the exchange offer under applicable law or
applicable interpretations of law by the Securities and Exchange
Commission staff;
- for any reason, the exchange offer is not consummated by December 15,
1999;
- any holder of old notes notifies us that it (1) is prohibited from
participating in the exchange offer, (2) may not resell the new notes
acquired by it in the exchange offer to the public without delivering a
prospectus and this prospectus is not appropriate or available for
purposes of those resales or (3) is a broker-dealer and owns old notes
acquired directly from us or one of our affiliates; or
- the holders of a majority in aggregate principal amount of the old notes
notify us that they reasonably determine that the interests of the
holders of the old notes would be adversely affected by consummation of
the exchange offer.
If we are required to file a shelf registration statement, we must use our
best efforts to file the shelf registration statement relating to the old notes
on or before the 90th day after the obligation to file the shelf registration
statement arises. However, if our obligation arises because this exchange offer
has not been consummated by December 15, 1999, we must use our best efforts to
file the shelf registration statement by March 14, 2000. We will use our
commercially reasonable efforts to cause the shelf registration statement to be
declared effective no later than 180 days after the date that the obligation to
file the shelf registration statement arises.
If the shelf registration statement is filed, we will use our commercially
reasonable efforts to keep the shelf registration statement continuously
effective, supplemented and amended until May 7, 2001 or a shorter period that
will terminate when all the notes covered by the shelf registration statement
have been sold pursuant to the shelf registration statement or otherwise cease
to be outstanding.
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A holder who sells old notes pursuant to the shelf registration statement
generally will be required to be named as a selling securityholder in the
prospectus and to deliver a copy of the prospectus to purchasers. If we are
required to file a shelf registration statement, we will provide to each holder
of the old notes copies of the prospectus that is a part of the shelf
registration statement and notify each such holder when the shelf registration
statement becomes effective. Such holder will be subject to some of the civil
liability provisions under the Securities Act of 1933 in connection with these
sales and will be bound by the provisions of the registration rights agreement
that are applicable to such holder (including certain indemnification and
contribution obligations).
The registration rights agreement requires us to pay the holders of the
notes additional interest if a registration default exists. A registration
default will exist if:
- we fail to file any of the registration statements required by the
registration rights agreement on or prior to the date specified for such
filing;
- any of such registration statements is not declared effective by the
Securities and Exchange Commission on or prior to the date specified for
such effectiveness;
- the exchange offer is required to be consummated under the registration
rights agreement and is not consummated by December 15, 1999;
- the exchange offer registration statement is declared effective but
thereafter, during the period for which we have agreed to make this
prospectus available to broker-dealers for use in connection with the
resale of new notes, the exchange offer registration statement ceases to
be effective (or we restrict the use of the prospectus included in the
exchange offer registration statement); or
- the shelf registration statement is declared effective but thereafter,
during the period for which we are required to maintain the effectiveness
of the shelf registration statement, it ceases to be effective or usable
in connection with the resale of the new notes covered by the shelf
registration statement.
If a registration default exists, the interest rate of the old notes will
be increased by $0.05 per week per $1,000 in principal amount of old notes for
the first 90-day period (or portion thereof) following the registration default.
The interest rate will increase by an additional $0.05 per week per $1,000 in
principal amount of old notes for each subsequent 90-day period (or portion
thereof) until all registration defaults have been remedied. The interest rate
may not be increased as a result of registration defaults by more than $0.50 per
week per $1,000 in principal amount of old notes. Following the cure of all
registration defaults, the accrual of additional interest on the old notes will
cease and the interest rate will revert to the original rate.
The exchange offer is intended to satisfy our exchange offer obligations
under the registration rights agreement. The above summary of the registration
rights agreement is not complete and is subject to, and qualified by reference
to, all of the provisions of the registration rights agreement. A copy of the
registration rights agreement is filed as an exhibit to the registration
statement that includes this prospectus.
If you participate in the exchange offer, you will, with limited
exceptions, receive notes that are freely tradeable and not subject to
restrictions on transfer. You should read this prospectus under the heading
"--Resales of the New Notes" for more information relating to your ability to
transfer new notes.
The exchange offer is not being made to, nor will we accept tenders for
exchange from, holders of old notes in any jurisdiction in which the exchange
offer or the acceptance of the exchange offer would not be in compliance with
the securities laws or blue sky laws of such jurisdiction.
EXPIRATION DATE; EXTENSIONS
The expiration date of the exchange offer is , 1999 at 5:00 p.m.,
New York City time. We may extend the exchange offer in our sole discretion. If
we extend the exchange offer, the expiration date
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will be the latest date and time to which the exchange offer is extended. We
will notify the exchange agent of any extension by oral or written notice and
will make a public announcement of the extension no later than 9:00 a.m., New
York City time, on the next business day after the previously scheduled
expiration date.
We expressly reserve the right, in our sole and absolute discretion:
- to delay accepting any old notes;
- to extend the exchange offer;
- if any of the conditions under "--Conditions of the Exchange Offer" have
not been satisfied, to terminate the exchange offer; and
- to waive any condition or otherwise amend the terms of the exchange offer
in any manner.
If the exchange offer is amended in a manner we deem to constitute a
material change, we will promptly disclose the amendment by means of a
prospectus supplement that will be distributed to the registered holders of the
old notes. Any delay in acceptance, extension, termination or amendment will be
followed promptly by an oral or written notice of the event to the exchange
agent. We will also make a public announcement of the event. Without limiting
the manner in which we may choose to make any public announcement and subject to
applicable law, we have no obligation to publish, advertise or otherwise
communicate any such public announcement other than by issuing a release to a
national news service.
TERMS OF THE EXCHANGE OFFER
We are offering, upon the terms and subject to the conditions set forth in
this prospectus and in the accompanying letter of transmittal, to exchange
$1,000 in principal amount of new notes for each $1,000 in principal amount of
outstanding old notes. We will accept for exchange any and all old notes that
are validly tendered on or before 5:00 p.m., New York City time, on the
expiration date. Tenders of the old notes may be withdrawn at any time before
5:00 p.m., New York City time, on the expiration date. The exchange offer is not
conditioned upon any minimum principal amount of old notes being tendered for
exchange. However, the exchange offer is subject to the terms of the
registration rights agreement and the satisfaction of the conditions described
under "--Conditions of the Exchange Offer." Old notes may be tendered only in
multiples of $1,000. Holders may tender less than the aggregate principal amount
represented by their old notes if they appropriately indicate this fact on the
letter of transmittal accompanying the tendered old notes or indicate this fact
pursuant to the procedures for book-entry transfer described below.
As of the date of this prospectus, $30.0 million in aggregate principal
amount of the old notes were outstanding. Solely for reasons of administration,
we have fixed the close of business on , 1999 as the record date for
purposes of determining the persons to whom this prospectus and the letter of
transmittal will be mailed initially. Only a holder of the old notes (or such
holder's legal representative or attorney-in-fact) whose ownership is reflected
in the records of Harris Trust and Savings Bank, as registrar, or whose notes
are held of record by the depositary, may participate in the exchange offer.
There will be no fixed record date for determining the eligible holders of the
old notes who are entitled to participate in the exchange offer. We believe
that, as of the date of this prospectus, no holder is our "affiliate" (as
defined in Rule 405 under the Securities Act of 1933).
We will be deemed to have accepted validly tendered old notes when, as and
if we give oral or written notice of our acceptance to the exchange agent. The
exchange agent will act as agent for the tendering holders of old notes and for
purposes of receiving the new notes from us. If any tendered old notes are not
accepted for exchange because of an invalid tender or otherwise, certificates
for the unaccepted old notes will be returned, without expense, to the tendering
holder as promptly as practicable after the expiration date.
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Holders of old notes do not have appraisal or dissenters' rights under
applicable law or the indenture as a result of the exchange offer. We intend to
conduct the exchange offer in accordance with the applicable requirements of the
Securities Exchange Act of 1934 and the rules and regulations under the
Securities Exchange Act of 1934, including Rule 14e-1.
Holders who tender their old notes in the exchange offer will not be
required to pay brokerage commissions or fees or, subject to the instructions in
the letter of transmittal, transfer taxes with respect to the exchange of old
notes pursuant to the exchange offer. We will pay all charges and expenses,
other than transfer taxes in certain circumstances, in connection with the
exchange offer. See "--Fees and Expenses."
Neither we nor our board of directors makes any recommendation to holders
of old notes as to whether to tender any of their old notes pursuant to the
exchange offer. In addition, no one has been authorized to make any such
recommendation. Holders of old notes must make their own decision whether to
participate in the exchange offer and, if the holder chooses to participate in
the exchange offer, the aggregate principal amount of old notes to tender, after
reading carefully this prospectus and the letter of transmittal and consulting
with their advisors, if any, based on their own financial position and
requirements.
CONDITIONS OF THE EXCHANGE OFFER
You must tender your old notes in accordance with the requirements of this
prospectus and the letter of transmittal in order to participate in the exchange
offer.
Notwithstanding any other provision of the exchange offer, or any extension
of the exchange offer, we will not be required to accept for exchange any old
notes, and we may terminate or amend the exchange offer if we are not permitted
to effect the exchange offer under applicable law or any interpretation of
applicable law by the staff of the Securities and Exchange Commission. If we
determine in our sole discretion that any of these events or conditions has
occurred, we may, subject to applicable law, terminate the exchange offer and
return all old notes tendered for exchange or may waive any condition or amend
the terms of the exchange offer.
We expect that the above conditions will be satisfied. The above conditions
are for our sole benefit and may be waived by us at any time in our sole
discretion. Our failure at any time to exercise any of the above rights will not
be a waiver of those rights and each right will be deemed an ongoing right that
may be asserted at any time. Any determination by us concerning the events
described above will be final and binding upon all parties.
INTEREST
Each new note will bear interest from the most recent date to which
interest has been paid or duly provided for on the old note surrendered in
exchange for such new note or, if no interest has been paid or duly provided for
on such old note, from May 7, 1999. Holders of the old notes whose old notes are
accepted for exchange will not receive accrued interest on their old notes for
any period from and after the last interest payment date to which interest has
been paid or duly provided for on their old notes prior to the original issue
date of the new notes or, if no such interest has been paid or duly provided
for, will not receive any accrued interest on their old notes, and will be
deemed to have waived the right to receive any interest on their old notes
accrued from and after such interest payment date or, if no such interest has
been paid or duly provided for, from and after May 7, 1999.
PROCEDURES FOR TENDERING OLD NOTES
The tender of a holder's old notes and our acceptance of old notes will
constitute a binding agreement between the tendering holder and us upon the
terms and conditions of this prospectus and the letter of transmittal. Unless a
holder tenders old notes according to the guaranteed delivery procedures or the
book-entry procedures described below, the holder must transmit the old notes,
together with a properly completed and executed letter of transmittal and all
other documents required by the letter of transmittal,
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<PAGE> 32
to the exchange agent at its address before 5:00 p.m., New York City time, on
the expiration date. The method of delivery of old notes, letters of transmittal
and all other required documents is at the election and risk of the tendering
holder. If delivery is by mail, we recommend delivery by registered mail,
properly insured, with return receipt requested. Instead of delivery by mail, we
recommend that each holder use an overnight or hand delivery service. In all
cases, sufficient time should be allowed to assure timely delivery.
Any beneficial owner of the old notes whose old notes are registered in the
name of a broker, dealer, commercial bank, trust company or other nominee and
who wishes to tender old notes in the exchange offer should contact that
registered holder promptly and instruct that registered holder to tender on its
behalf. If the beneficial owner wishes to tender directly, it must, prior to
completing and executing the letter of transmittal and tendering old notes, make
appropriate arrangements to register ownership of the old notes in its name.
Beneficial owners should be aware that the transfer of registered ownership may
take considerable time.
Any financial institution that is a participant in the Book-Entry Transfer
Facility system of The Depository Trust Company, or DTC, may make book-entry
delivery of the old notes by causing DTC to transfer the old notes into the
exchange agent's account in accordance with DTC's procedures for such transfer.
To be timely, book-entry delivery of old notes requires receipt of a
confirmation of a book-entry transfer before the expiration date. Although
delivery of the old notes may be effected through book-entry transfer into the
exchange agent's account at DTC, the letter of transmittal (or facsimile),
properly completed and executed, with any required signature guarantees and any
other required documents or an agent's message (as described below), must in any
case be delivered to and received by the exchange agent at its address on or
before the expiration date, or the guaranteed delivery procedure set forth below
must be complied with.
Each signature on a letter of transmittal or a notice of withdrawal must be
guaranteed unless the old notes are tendered:
- by a registered holder who has not completed the box entitled "Special
Delivery Instructions"; or
- for the account of an eligible institution (as described below).
If a signature on a letter of transmittal or a notice of withdrawal is
required to be guaranteed, the signature must be guaranteed by a participant in
a recognized Medallion Signature Program (a "Medallion Signature Guarantor"). If
the letter of transmittal is signed by a person other than the registered holder
of the old notes, the old notes surrendered for exchange must be endorsed by the
registered holder, with the signature guaranteed by a Medallion Signature
Guarantor. If any letter of transmittal, endorsement, bond power, power of
attorney or any other document required by the letter of transmittal is signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should sign in that capacity when signing. Such person must submit
to us evidence satisfactory, in our sole discretion, of his or her authority to
so act unless we waive such requirement.
As used in this prospectus with respect to the old notes, a "registered
holder" is any person in whose name the old notes are registered on the books of
the registrar. An "eligible institution" is a firm that is a member of a
registered national securities exchange or of the National Association of
Securities Dealers, Inc., a commercial bank or trust company having an office or
correspondent in the United States or any other "eligible guarantor institution"
as such term is defined in Rule 17Ad-15 under the Securities Exchange Act of
1934.
We will determine in our sole discretion all questions as to the validity,
form, eligibility (including time of receipt), acceptance and withdrawal of old
notes tendered for exchange. Our determination will be final and binding. We
reserve the absolute right to reject old notes not properly tendered and to
reject any old notes if acceptance might, in our judgment or our counsel's
judgment, be unlawful. We also reserve the absolute right to waive any defects
or irregularities or conditions of the exchange offer as to particular old notes
at any time, including the right to waive the ineligibility of any holder who
seeks to tender old notes in the exchange offer.
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<PAGE> 33
Our interpretation of the terms and conditions of the exchange offer,
including the letter of transmittal and its instructions, will be final and
binding on all parties. Unless waived, any defects or irregularities in
connection with tenders of old notes for exchange must be cured within such
period of time as we determine. Neither we nor the exchange agent is under any
duty to give notification of defects in such tenders or will incur any liability
for failure to give such notification. The exchange agent will use reasonable
efforts to give notification of defects or irregularities with respect to
tenders of old notes for exchange but will not incur any liability for failure
to give such notification. Tenders of old notes will not be deemed to have been
made until such irregularities have been cured or waived.
By tendering, you will represent to us that, among other things:
- you are not our "affiliate" (as defined in Rule 405 under the Securities
Act of 1933);
- you will acquire the new notes in the ordinary course of your business;
- you are not a broker-dealer that acquired your notes directly from us in
order to resell them pursuant to Rule 144A under the Securities Act of
1933 or any other available exemption under the Securities Act of 1933;
- if you are a broker-dealer that acquired your notes as a result of
market-making or other trading activities, you will deliver a prospectus
in connection with any resale of new notes; and
- you are not participating, do not intend to participate and have no
arrangement or understanding with any person to participate in the
distribution of the new notes.
In connection with a book-entry transfer, each participant will confirm
that it makes the representations and warranties contained in the letter of
transmittal.
GUARANTEED DELIVERY PROCEDURES
If you wish to tender your old notes and:
- your old notes are not immediately available;
- you are unable to deliver on time your old notes or any other document
that you are required to deliver to the exchange agent; or
- you cannot complete the procedures for delivery by book-entry transfer on
time;
you may tender your old notes according to the guaranteed delivery procedures
described in the letter of transmittal. Those procedures require that:
- tender must be made by or through an eligible institution and a notice of
guaranteed delivery must be signed by the holder;
- on or before the expiration date, the exchange agent must receive from
the holder and the eligible institution a properly completed and executed
notice of guaranteed delivery by facsimile transmission, mail or hand
delivery setting forth the name and address of the holder, the
certificate number or numbers of the tendered old notes and the principal
amount of tendered old notes; and
- properly completed and executed documents required by the letter of
transmittal and the tendered old notes in proper form for transfer or
confirmation of a book-entry transfer of such old notes into the exchange
agent's account at DTC must be received by the exchange agent within four
business days after the expiration date of the exchange offer.
Any holder who wishes to tender old notes pursuant to the guaranteed
delivery procedures must ensure that the exchange agent receives the notice of
guaranteed delivery and letter of transmittal relating to such old notes before
5:00 p.m., New York City time, on the expiration date.
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<PAGE> 34
ACCEPTANCE OF OLD NOTES FOR EXCHANGE; DELIVERY OF NEW NOTES
Upon satisfaction or waiver of all the conditions to the exchange offer, we
will accept old notes that are properly tendered in the exchange offer prior to
5:00 p.m., New York City time, on the expiration date. The new notes will be
delivered promptly after acceptance of the old notes. For purposes of the
exchange offer, we will be deemed to have accepted validly tendered old notes
when, as and if we have given notice to the exchange agent.
WITHDRAWAL RIGHTS
Tenders of the old notes may be withdrawn by delivery of a written or
facsimile transmission notice to the exchange agent at its address set forth
under "--The Exchange Agent; Assistance" at any time before 5:00 p.m., New York
City time, on the expiration date. Any such notice of withdrawal must:
- specify the name of the person having deposited the old notes to be
withdrawn;
- identify the old notes to be withdrawn, including the certificate number
or numbers and principal amount of such old notes, or, in the case of old
notes transferred by book-entry transfer, the name and number of the
account at DTC to be credited;
- be signed by the holder in the same manner as the original signature on
the letter of transmittal by which old notes were tendered, including any
required signature guarantees, or be accompanied by a bond power in the
name of the person withdrawing the tender, in satisfactory form as
determined by us in our sole discretion, executed by the registered
holder, with the signature guaranteed by a Medallion Signature Guarantor,
together with the other documents required upon transfer by the
indenture; and
- specify the name in which the old notes are to be re-registered, if
different from the person who deposited the old notes.
We will determine, in our sole discretion, all questions as to the
validity, form and eligibility (including time of receipt) of such notices. Any
old notes withdrawn will be deemed not to have been validly tendered for
exchange for purposes of the exchange offer and will be returned to the holder
without cost as soon as practicable after withdrawal. Properly withdrawn old
notes may be retendered pursuant to the procedures described under "--Procedures
for Tendering Old Notes" at any time on or before the expiration date.
THE EXCHANGE AGENT; ASSISTANCE
Harris Trust and Savings Bank is the exchange agent. All tendered old
notes, executed letters of transmittal and other related documents should be
directed to the exchange agent. Questions and requests for assistance and
requests for additional copies of the prospectus, the letter of transmittal and
other related documents should be addressed to the exchange agent as follows:
BY HAND, REGISTERED OR CERTIFIED MAIL OR OVERNIGHT COURIER:
Harris Trust and Savings Bank
311 West Monroe Street
Chicago, Illinois 60606
Attention: Daniel G. Donovan
BY FACSIMILE:
(312) 461-3525
Attention: Daniel G. Donovan
Confirm by Telephone: (312) 461-2908
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<PAGE> 35
FEES AND EXPENSES
We will bear the expenses of soliciting old notes for exchange. The
principal solicitation is being made by mail by the exchange agent. Additional
solicitations may be made by telephone, facsimile or in person by officers and
regular employees of our company and our affiliates and by persons so engaged by
the exchange agent.
We will pay the exchange agent reasonable and customary fees for its
services and will reimburse the exchange agent for its reasonable out-of-pocket
expenses in connection with its services and pay other registration expenses,
including fees and expenses of the trustee under the indenture, filing fees,
blue sky fees and printing and distribution expenses.
We have not retained any dealer-manager in connection with the exchange
offer and will not make any payments to brokers, dealers or others soliciting
acceptance of the exchange offer.
We will pay all transfer taxes, if any, applicable to the exchange of old
notes pursuant to the exchange offer. If, however, a transfer tax is imposed for
any reason other than the exchange of old notes pursuant to the exchange offer,
then the amount of those transfer taxes, whether imposed on the registered
holder or any other persons, will be payable by the tendering holder. If
satisfactory evidence of payment of those taxes or exemption is not submitted
with the letter of transmittal, the amount of those transfer taxes will be
billed directly to such tendering holder.
ACCOUNTING TREATMENT
The new notes will be recorded at the same carrying value as the old notes,
as reflected in our accounting records on the date of the exchange. Accordingly,
we will recognize no gain or loss for accounting purposes. The expenses of the
exchange offer will be amortized over the term of the new notes.
CONSEQUENCES OF NOT EXCHANGING OLD NOTES
As a result of this exchange offer, we will have fulfilled most of our
obligations under the registration rights agreement. Holders who do not tender
their old notes, except for certain instances involving the initial purchasers
or holders of old notes who are not eligible to participate in the exchange
offer or who do not receive freely transferrable new notes pursuant to the
exchange offer, will not have any further registration rights under the
registration rights agreement or otherwise and will not have rights to receive
additional interest. Accordingly, any holder who does not exchange its old notes
for new notes will continue to hold the untendered old notes and will be
entitled to all the rights and subject to all the limitations applicable under
the indenture, except to the extent that such rights or limitations, by their
terms, terminate or cease to have further effectiveness as a result of the
exchange offer.
Any old notes that are not exchanged for new notes pursuant to the exchange
offer will remain restricted securities within the meaning of the Securities Act
of 1933. In general, such old notes may be resold only:
- to our company or any of our subsidiaries;
- inside the United States to a "qualified institutional buyer" in
compliance with Rule 144A under the Securities Act of 1933;
- inside the United States to an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act of
1933) that, prior to such transfer, furnishes or has furnished on its
behalf by a U.S. broker-dealer to the trustee under the indenture a
signed letter containing certain representations and agreements relating
to the restrictions on transfer of the new notes, the form of which
letter can be obtained from the trustee;
- outside the United States in compliance with Rule 904 under the
Securities Act of 1933;
- pursuant to the exemption from registration provided by Rule 144 under
the Securities Act of 1933, if available; or
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<PAGE> 36
- pursuant to an effective registration statement under the Securities Act
of 1933.
Each accredited investor that is not a qualified institutional buyer and
that is an original purchaser of any of the old notes from the initial
purchasers will be required to sign a letter confirming that it is an accredited
investor under the Securities Act of 1933 and that it acknowledges the transfer
restrictions summarized above.
RESALES OF THE NEW NOTES
We are making the exchange offer in reliance on the position of the staff
of the Securities and Exchange Commission as set forth in interpretive letters
addressed to third parties in other transactions. However, we have not sought
our own interpretive letter. Although there has been no indication of any change
in the staff's position, we cannot assure you that the staff of the Securities
and Exchange Commission would make a similar determination with respect to the
exchange offer as it has in its interpretive letters to third parties. Based on
these interpretations by the staff, and except as provided below, we believe
that new notes may be offered for resale, resold and otherwise transferred by a
holder who participates in the exchange offer and is not a broker-dealer without
further compliance with the registration and prospectus delivery provisions of
the Securities Act of 1933. In order to receive new notes that are freely
tradeable, a holder must acquire the new notes in the ordinary course of its
business and may not participate, or have any arrangement or understanding with
any person to participate, in the distribution (within the meaning of the
Securities Act of 1933) of the new notes. Holders wishing to participate in the
exchange offer must make the representations described in "--Procedures for
Tendering Old Notes" above.
Any holder of old notes:
- who is our "affiliate" (as defined in Rule 405 under the Securities Act
of 1933);
- who did not acquire the new notes in the ordinary course of its business;
- who is a broker-dealer that purchased old notes from us to resell them
pursuant to Rule 144A under the Securities Act of 1933 or any other
available exemption under the Securities Act of 1933; or
- who intends to participate in the exchange offer for the purpose of
distributing (within the meaning of the Securities Act of 1933) new
notes;
will be subject to separate restrictions. Each holder in any of the above
categories:
- will not be able to rely on the interpretations of the staff of the
Securities Act of 1933 in the above-mentioned interpretive letters;
- will not be permitted or entitled to tender old notes in the exchange
offer; and
- must comply with the registration and prospectus delivery requirements of
the Securities Act of 1933 in connection with any sale or other transfer
of old notes, unless such sale is made pursuant to an exemption from such
requirements.
In addition, if you are a broker-dealer holding old notes acquired for your
own account, then you may be deemed a statutory "underwriter" within the meaning
of the Securities Act of 1933 and must deliver a prospectus meeting the
requirements of the Securities Act of 1933 in connection with any resales of
your new notes. Each broker-dealer that receives new notes for its own account
pursuant to the exchange offer must acknowledge that it acquired the old notes
for its own account as a result of market-making activities or other trading
activities and must agree that it will deliver a prospectus meeting the
requirements of the Securities Act of 1933 in connection with any resale of
those new notes. The letter of transmittal states that, by making the above
acknowledgment and by delivering a prospectus, a broker-dealer will not be
deemed to admit that it is an "underwriter" within the meaning of the Securities
Act of 1933.
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<PAGE> 37
Based on the position taken by the staff of the Securities and Exchange
Commission in the interpretive letters referred to above, we believe that
broker-dealers that acquired old notes for their own accounts, as a result of
market-making or other trading activities ("Participating Broker-Dealers"), may
fulfill their prospectus delivery requirements with respect to the new notes
received upon exchange of old notes (other than old notes that represent an
unsold allotment from the original sale of the old notes) with a prospectus
meeting the requirements of the Securities Act of 1933, which may be the
prospectus prepared for an exchange offer so long as it contains a description
of the plan of distribution with respect to the resale of such new notes.
Accordingly, this prospectus, as it may be amended or supplemented, may be used
by a Participating Broker-Dealer during the period referred to below in
connection with resales of new notes received in exchange for old notes where
such old notes were acquired by the Participating Broker-Dealer for its own
account as a result of market-making or other trading activities. Subject to the
provisions of the registration rights agreement, we have agreed that this
prospectus may be used by a Participating Broker-Dealer in connection with
resales of such new notes. See "Plan of Distribution." However, a Participating
Broker-Dealer that intends to use this prospectus in connection with the resale
of new notes received in exchange for old notes pursuant to the exchange offer
must notify us, or cause us to be notified, on or before the expiration date of
the exchange offer, that it is a Participating Broker-Dealer. Such notice may be
given in the space provided for that purpose in the letter of transmittal or may
be delivered to the exchange agent at the address set forth under "--The
Exchange Agent; Assistance." Any Participating Broker-Dealer that is our
"affiliate" may not rely on such interpretive letters and must comply with the
registration and prospectus delivery requirements of the Securities Act of 1933
in connection with any resale transaction.
Each Participating Broker-Dealer that tenders old notes pursuant to the
exchange offer will be deemed to have agreed, by execution of the letter of
transmittal, that upon receipt of notice from us of the occurrence of any event
or the discovery of any fact that makes any statement contained in this
prospectus untrue in any material respect or that causes this prospectus to omit
to state a material fact necessary in order to make the statements contained
herein, in light of the circumstances under which they were made, not misleading
or of the occurrence of other events specified in the registration rights
agreement, such Participating Broker-Dealer will suspend the sale of new notes
pursuant to this prospectus until we have amended or supplemented this
prospectus to correct such misstatement or omission and have furnished copies of
the amended or supplemented prospectus to the Participating Broker-Dealer or we
have given notice that the sale of the new notes may be resumed, as the case may
be.
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<PAGE> 38
USE OF PROCEEDS
We will not receive any proceeds from the exchange offer. In consideration
for issuing the new notes, we will receive outstanding old notes in like
original principal amount at maturity. All old notes received in the exchange
offer will be canceled.
The net proceeds from the sale of the old notes was approximately $27.0
million, before estimated expenses and fees. We used the net proceeds to: (i)
repay approximately $25.5 million of outstanding borrowings under our senior
credit facility and (ii) pay approximately $1.5 million of related transaction
expenses and fees. We may reborrow up to $9.0 million under our senior credit
facility to redeem a portion of our Series A and Series B convertible preferred
stock.
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<PAGE> 39
CAPITALIZATION
The following table sets forth our unaudited consolidated capitalization as
of March 31, 1999 and as adjusted to give effect to the offering of the old
notes and the application of the net proceeds therefrom. See "Use of Proceeds."
The information below should be read together with the financial statements and
related notes thereto. See "Description of Certain Indebtedness."
<TABLE>
<CAPTION>
AS OF
MARCH 31, 1999
---------------------
(UNAUDITED)
ACTUAL PRO FORMA
------ -----------
(IN MILLIONS)
<S> <C> <C>
Cash and equivalents........................................ $ 2.5 $ 2.5
====== ======
Debt (including current portion):
Senior Credit Facility(1)................................. $144.4 $118.9
12 3/4% Senior Secured Notes.............................. 0 27.0(2)
Third party debt.......................................... 7.4 7.4
Related party debt........................................ 3.7 3.7
10% Senior Subordinated Notes............................. 180.0 180.0
------ ------
Total debt........................................... 335.5 337.0
Stockholders' equity:
Convertible preferred stock............................... $ 20.0 $ 20.0
Common stock, warrants and additional paid-in capital..... 301.1 301.1
Accumulated deficit....................................... (81.9) (81.9)
------ ------
Total stockholders' equity........................... 239.2 239.2
------ ------
Total capitalization................................. $574.7 $576.2
====== ======
</TABLE>
- ---------------
(1) Excludes outstanding letters of credit of $5.4 million as of March 31, 1999.
Such letters of credit include a $2.4 million letter of credit that secures
notes payable issued to former shareholders of the Isaac Group in connection
with our acquisition of the Isaac Group.
(2) Net of unamortized discount of $3.0 million.
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DESCRIPTION OF THE NOTES
The old notes were, and the new notes will be, issued as a single series of
securities under the indenture, dated as of May 7, 1999, among Metal Management,
as issuer, Metal Management's subsidiaries, as subsidiary guarantors, and Harris
Trust and Savings Bank, as trustee. The form and terms of the new notes are
substantially identical to the form and terms of the old notes, except that the
new notes:
- will be registered under the Securities Act of 1933; and
- will not bear any legends restricting transfer.
The new notes will be issued solely in exchange for an equal principal
amount of old notes. As of the date of this prospectus, $30.0 million aggregate
principal amount of old notes is outstanding.
In the following summaries:
- "new notes" refers to the registered notes being offered by this
prospectus;
- "old notes" refers to your old notes that may be exchanged for new notes
in the exchange offer;
- "notes" refers collectively to the new notes and the old notes; and
- "Metal Management" refers only to Metal Management, Inc. and not to any
of its Subsidiaries.
The following summaries of certain provisions of the indenture are not
complete and are subject to all the provisions of the indenture. Wherever we
refer to particular sections or defined terms used in the indenture, such
sections or defined terms are automatically incorporated into this prospectus.
We have filed a copy of the indenture with the Securities and Exchange
Commission and the indenture is incorporated by reference into the registration
statement. The meanings of some of the terms that are important in understanding
the following summaries are set forth below under the subheading "Definitions."
BRIEF DESCRIPTION OF THE NEW NOTES AND THE GUARANTEES
The New Notes
The new notes will be:
- senior obligations of Metal Management;
- pari passu in right of payment to all existing and future unsubordinated
indebtedness of Metal Management;
- senior in right of payment to all existing and future Subordinated
Indebtedness of Metal Management;
- unconditionally guaranteed on a senior basis, jointly and severally, by
the Subsidiary Guarantors; and
- secured by a second priority lien on substantially all of the personal
property, plant (to the extent it constitutes fixtures) and equipment of
Metal Management and the Subsidiary Guarantors.
The Guarantees
The new notes will be guaranteed by each of the existing Subsidiaries of
Metal Management and certain future Restricted Subsidiaries of Metal Management.
The Subsidiary Guarantees of the new notes will be:
- senior obligations of each Subsidiary Guarantor;
- pari passu in right of payment to all existing and future unsubordinated
indebtedness of each Subsidiary Guarantor;
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<PAGE> 41
- senior in right of payment to all existing and future Subordinated
Indebtedness of each Subsidiary Guarantor; and
- secured by a second priority lien on substantially all of the personal
property, plant (to the extent it constitutes fixtures) and equipment of
the Subsidiary Guarantors.
PRINCIPAL, MATURITY AND INTEREST
The notes are limited in aggregate principal amount to $30.0 million and
will mature on June 15, 2004. Interest on the notes accrues at the rate of
12 3/4% per annum and is payable in cash semi-annually in arrears on each June
15 and December 15, commencing on December 15, 1999, to Holders of record on the
immediately preceding June 1 and December 1.
The old notes were originally issued at a discount from their principal
amount at maturity. As a result, for federal income tax purposes, Holders may be
required to include amounts as income prior to the receipt of cash attributable
thereto. See "Certain Federal Income Tax Consequences--Tax Consequences to
United States Holders-- Original Issue Discount."
Interest on the notes accrues from the most recent date to which interest
has been paid or, if no interest has been paid, from May 7, 1999. Interest is
computed on the basis of a 360-day year comprised of twelve 30-day months.
Principal, interest, premium and liquidated damages, if any, on the notes is
payable at the office or agency of Metal Management maintained for such purpose
within the City and State of New York or, at the option of Metal Management,
payment of interest and liquidated damages, if any, may be made by check mailed
to the Holders of the notes at their respective addresses set forth in the
register of Holders of notes; provided that all payments with respect to Global
Notes and definitive notes, the Holders of which have given written wire
transfer instructions to Metal Management, will be required to be made by wire
transfer of immediately available funds to the accounts specified by the Holders
thereof. Until otherwise designated by Metal Management, Metal Management's
office or agency in New York will be the office of the trustee maintained for
such purpose. The old notes were, and the new notes will be, issued in minimum
denominations of $1,000 and integral multiples thereof.
SETTLEMENT AND PAYMENT
Settlement for the notes will be made in immediately available funds.
Payments by Metal Management in respect of the notes (including principal,
interest, premium and liquidated damages, if any) will be made in immediately
available funds. The old notes are, and the new notes are expected to be,
eligible to trade in the PORTAL market and to trade in the depositary's Same-Day
Funds Settlement System, and any permitted secondary market trading activity in
the notes will, therefore, be required by the depositary to be settled in
immediately available funds. No assurance can be given as to the effect, if any,
of such settlement arrangements on trading activity in the notes.
Because of time zone differences, the securities account of a Euroclear or
CEDEL participant purchasing an interest in a Global Note from a Participant (as
defined herein) in DTC will be credited, and any such crediting will be reported
to the relevant Euroclear or CEDEL participant, during the securities settlement
processing day (which must be a business day for Euroclear and CEDEL)
immediately following the settlement date of DTC. DTC has advised Metal
Management that cash received in Euroclear or CEDEL as a result of sales of
interests in a Global Note by or through a Euroclear or CEDEL participant to a
Participant in DTC will be received with value on the settlement date of DTC but
will be available in the relevant Euroclear or CEDEL cash account only as of the
business day for Euroclear or CEDEL following DTC's settlement date.
SUBSIDIARY GUARANTEES
Metal Management's payment obligations under the notes are jointly and
severally guaranteed (the "Subsidiary Guarantees") by the Subsidiary Guarantors.
The Subsidiary Guarantee of each Subsidiary Guarantor rank pari passu in right
of payment with all unsubordinated indebtedness of such Subsidiary
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<PAGE> 42
Guarantor and senior in right of payment to all Subordinated Indebtedness of
such Subsidiary Guarantor. The Subsidiary Guarantees are secured by a second
priority lien to the extent described under "--Security." The obligations of
each Subsidiary Guarantor under its Subsidiary Guarantee are limited so as not
to constitute a fraudulent conveyance under applicable law. See, however, "Risk
Factors--The notes or the guarantees may be unenforceable due to fraudulent
conveyance statutes."
The indenture provides that, except for a merger of a Subsidiary Guarantor
with and into Metal Management or another Subsidiary Guarantor, no Subsidiary
Guarantor may consolidate or merge with or into (whether or not such Subsidiary
Guarantor is the surviving Person) another corporation, Person or entity unless:
(1) subject to the provisions of the following paragraph, the Person
formed by or surviving any such consolidation or merger (if other than such
Subsidiary Guarantor) assumes all the obligations of such Subsidiary
Guarantor pursuant to a supplemental indenture in form and substance
reasonably satisfactory to the trustee under the notes and the indenture;
(2) immediately after giving effect to such transaction, no Default or
Event of Default exists; and
(3) Metal Management would be permitted to incur, immediately after
giving effect to such transaction, at least $1.00 of additional
Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in
the covenant described below under "--Certain Covenants--Incurrence of
Indebtedness and Issuance of Disqualified Stock."
The indenture provides that in the event of a sale or other disposition of
all of the assets of any Subsidiary Guarantor, by way of merger, consolidation
or otherwise, or a sale or other disposition of all of the capital stock of any
Subsidiary Guarantor, then such Subsidiary Guarantor (in the event of a sale or
other disposition, by way of such a merger, consolidation or otherwise, of all
of the capital stock of such Subsidiary Guarantor) or the corporation acquiring
the property (in the event of a sale or other disposition of all of the assets
of such Subsidiary Guarantor) will be released and relieved of any obligations
under its Subsidiary Guarantee; provided that the Net Proceeds of such sale or
other disposition are applied in accordance with the applicable provisions of
the indenture. See "-- Repurchase at the Option of Holders--Asset Sales."
SECURITY
The notes are secured by a second priority Lien, subject to certain
exceptions, on substantially all of the existing and future assets (other than
real property not constituting fixtures) of Metal Management and the Subsidiary
Guarantors that, from time to time, secure the Obligations of Metal Management
and the Subsidiary Guarantors under the Senior Credit Facility including,
without limitation (whether now owned or hereafter arising or acquired):
(1) substantially all of the fixtures attached or affixed to the real
property owned or leased by Metal Management and the Subsidiary Guarantors,
together with all additions, accessions, improvements, alterations,
replacements and repairs thereto,
(2) substantially all of the machinery and equipment owned or leased
by Metal Management and the Subsidiary Guarantors, together with all
additions, accessions, improvements, alterations, replacements and repairs
thereto,
(3) substantially all of the accounts receivable and inventory of
Metal Management and the Subsidiary Guarantors,
(4) substantially all of the Capital Stock of each of the Subsidiary
Guarantors,
(5) substantially all of the intellectual property of Metal Management
and the Subsidiary Guarantors including, without limitation, all
trademarks, service marks, patents, licenses, trade secrets and other
proprietary information,
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(6) substantially all general intangibles relating to any and all of
the foregoing, and
(7) substantially all proceeds and products of any and all of the
foregoing (all such assets set forth in clauses (1) through (7)
collectively, and including all other property and assets that are from
time to time subject to the Security Documents, the "Collateral").
The Lien on the Collateral granted to the trustee for the benefit of the
trustee and the Holders of the notes are subject to Permitted Liens and Prior
Liens (including the Liens securing the Senior Bank Debt). The Collateral is
pledged to the trustee for the benefit of the trustee and the Holders of the
notes by Metal Management or the applicable Subsidiary Guarantor pursuant to a
security agreement.
Subject to the provisions described under "--Certain Covenants--Liens," the
notes and the Subsidiary Guarantees will in no event be secured by any
Collateral of Metal Management or any Subsidiary Guarantor, unless the
Obligations of Metal Management and its Subsidiaries under the Senior Credit
Facility (to the extent that there are any outstanding) are secured by a Lien
that is prior to the Lien securing the notes. If the Senior Credit Facility is
no longer in effect, or the Senior Bank Debt is no longer secured by any of the
Collateral, the notes and the Subsidiary Guarantees will not (subject to the
provisions under "--Certain Covenants--Liens") be secured by any of the
Collateral; provided, however, that if the Senior Bank Debt is thereafter
secured by assets that would constitute Collateral, the notes and the Subsidiary
Guarantees will be secured by a second priority Lien on such Collateral to the
same extent provided pursuant to the Security Documents. To the extent that the
Senior Credit Facility is in effect and the senior bank agent releases its Lien
on all or any portion of the Collateral of Metal Management or a Subsidiary
securing the Senior Bank Debt, the Lien on such Collateral securing the notes
and the Subsidiary Guarantees shall likewise be released (subject to the
provisions under "--Certain Covenants--Liens"); provided, however, that if the
Senior Bank Debt is thereafter secured by assets that would constitute
Collateral, the notes and the Subsidiary Guarantees will then be secured by a
second priority Lien on such Collateral, to the same extent provided pursuant to
the Security Documents. Notwithstanding the foregoing, if during an Event of
Default the Senior Bank Debt is repaid in full and the Senior Credit Facility
ceases to be in effect, any Collateral owned by Metal Management or any
Subsidiary Guarantor and not used to repay Senior Bank Debt shall continue to
secure the notes and the Subsidiary Guarantees and shall not be released as a
result of the Senior Credit Facility's Liens being released (but shall be
released when such Event of Default ceases to exist).
If the notes become due and payable prior to the final stated maturity
thereof for any reason or are not paid in full at the final stated maturity
thereof and after any applicable grace period has expired, pursuant to the
provisions of the intercreditor agreement, the senior bank agent (as defined
below) under the Senior Credit Facility, on behalf of the lenders thereunder,
will have the exclusive right to foreclose (or decline to foreclose) upon (or
otherwise exercise (or decline to exercise) remedies in respect of) the
Collateral. At such time as the Obligations under the Senior Bank Debt have been
satisfied in full, the trustee will have the right to foreclose upon the
Collateral in accordance with instructions from the Holders of a majority in
aggregate principal amount of the notes or, in the absence of such instructions,
in such manner as the trustee deems appropriate in its absolute discretion.
Proceeds from the sale of Collateral will first be applied to repay the Senior
Bank Debt or other indebtedness permitted by the Security Documents to be
secured by Liens senior to the Liens securing the notes, and thereafter such
proceeds will be required to be paid to the trustee. The proceeds received by
the trustee will be applied by the trustee first to pay the expenses of any
foreclosure and fees and other amounts then payable to the trustee under the
indenture and the Security Documents and, thereafter, to pay all amounts owing
to the Holders under the indenture, the notes and the Subsidiary Guarantees
(with any remaining proceeds to be payable to Metal Management and the
Subsidiary Guarantors or as may otherwise be required by law).
No appraisals of any of the Collateral have been prepared by or on behalf
of Metal Management or any Subsidiary Guarantor in connection with the issuance
and sale of the notes. There can be no assurance that the proceeds from the sale
of the Collateral remaining after the satisfaction of (1) all obligations owed
to holders of certain Liens which have priority over the Lien granted to the
trustee for the benefit of the Holders of the notes and (2) all Obligations
under the Senior Credit Facility or other indebtedness
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permitted by the Security Documents to be secured by Liens senior to the Liens
securing the notes, would be sufficient to satisfy payments due on the notes.
See "Risk Factors--In the case of a default, there may not be sufficient
collateral available to satisfy our obligations under the new notes." By its
nature, some or all of the Collateral will be illiquid and may have no readily
ascertainable market value. Accordingly, there can be no assurance that the
Collateral can be sold in a short period of time, if salable.
Holders of the notes will have no vote on any decisions with respect to the
Collateral, including the time or method of disposition (including release)
thereof or realization thereon. In addition, to the extent that third parties
enjoy Liens permitted by the Security Documents and the indenture, such third
parties will have rights and remedies with respect to the property subject to
such Lien that, if exercised, could adversely affect the value of the
Collateral. In addition, the ability of the Holders to realize upon the
Collateral may be subject to certain bankruptcy law limitations in the event of
a bankruptcy. See "Risk Factors--In the case of a default, there may not be
sufficient collateral available to satisfy our obligations under the new notes"
and "--Certain Bankruptcy Limitations."
As described under "--Repurchase at the Option of Holders--Asset Sales,"
the Net Proceeds of certain Asset Sales may under specified circumstances be
required to be utilized to make an offer to purchase notes. To the extent that
any such offer to purchase notes is not fully subscribed to by Holders thereof
or such Net Proceeds are not required to be applied to make an Asset Sale Offer
pursuant to provisions of such covenant, the Available Proceeds Amount may,
under certain circumstances, be retained and used by Metal Management, free of
the Lien of the indenture and the Security Documents.
CERTAIN BANKRUPTCY LIMITATIONS
The right of the trustee to repossess and dispose of, or otherwise exercise
remedies in respect of, the Collateral upon the occurrence of an Event of
Default is likely to be significantly impaired by applicable bankruptcy law (and
limitations in the intercreditor agreement) if a bankruptcy proceeding were to
be commenced by or against Metal Management or a Subsidiary of Metal Management
prior to the trustee having repossessed and disposed of, or otherwise exercised
remedies in respect of, the Collateral. Under the Bankruptcy Code, a secured
creditor such as the trustee is prohibited from repossessing its security from a
debtor in a bankruptcy case, or from disposing of security repossessed from such
debtor, without bankruptcy court approval. Moreover, the Bankruptcy Code permits
the debtor to continue to retain and to use collateral even though the debtor is
in default under the applicable debt instruments, provided that the secured
creditor is given "adequate protection." However, pursuant to the intercreditor
agreement, the trustee will be required to turn over to the senior bank agent
any "adequate protection" that the trustee receives to the extent necessary to
make the senior bank agent and the lenders under the Senior Credit Facility
whole. The meaning of the term "adequate protection" may vary according to
circumstances, but it is intended in general to protect the value of the secured
creditor's interest in the collateral and may include cash payments or the
granting of additional security, if and at such times as the court in its
discretion determines, for any diminution in the value of the collateral as a
result of the stay of repossession or disposition or any use of the collateral
by the debtor during the pendency of the bankruptcy case. In view of the lack of
a precise definition of the term "adequate protection" and the broad
discretionary powers of a bankruptcy court (as well as the limitations under the
intercreditor agreement), it is impossible to predict how long payments under
the notes of the Subsidiary Guarantees could be delayed following commencement
of a bankruptcy case, whether or when the trustee could repossess or dispose of
the Collateral or whether or to what extent Holders of the notes would be
compensated for any delay in payment or loss of value of the Collateral.
INTERCREDITOR AGREEMENT
On May 7, 1999, the trustee, on behalf of the Holders of the notes, entered
into an intercreditor agreement with BT Commercial Corporation, as agent for the
lenders under the Senior Credit Facility (in such capacity and together with any
successor agent, the "senior bank agent") which was acknowledged by Metal
Management and the Subsidiary Guarantors. The intercreditor agreement provides
for the allocation of rights between the trustee and the senior bank agent with
respect to the Collateral and the enforcement
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provisions with respect thereto. So long as the Senior Bank Debt remains
outstanding, the lenders under the Senior Credit Facility shall have the
exclusive right to determine the circumstances and manner in which Collateral
shall be disposed of or realized upon and the timing of such disposition or
realization including but not limited to, the determination of whether to
release all or any portion of the Collateral from the Lien created by the
Security Documents and whether to exercise remedies in respect of the Collateral
following an Event of Default. The intercreditor agreement provides, among other
things, that:
(1) the senior bank agent has a security interest in the Collateral,
senior and prior to the Security Interest of the trustee therein,
(2) all decisions with respect to the Collateral, including the time
and method of any disposition thereof, will be made by the senior bank
agent,
(3) as between the Obligations under the Senior Credit Facility and
Obligations under the indenture, proceeds of the Collateral will be
applied, first, to the outstanding Obligations under the Senior Credit
Facility, with any remaining proceeds to be paid to the trustee for
application in accordance with the provisions of the indenture,
(4) the senior bank agent and the trustee will not contest each
other's security interest in and Liens on their respective collateral or
contest the validity of the documents governing the Senior Credit Facility
or the notes, respectively,
(5) in a bankruptcy or insolvency proceeding, the holders of Senior
Bank Debt may consent to the use of cash collateral in their sole
discretion and may receive Liens on the property of Metal Management or any
Subsidiary Guarantor, superior to those of the trustee or to the exclusion
of the trustee,
(6) the trustee will not object to sales or dispositions of collateral
securing the Senior Bank Debt under Section 363 of the Bankruptcy Code if
the holders of Senior Bank Debt have consented to such sale or disposition,
(7) the trustee agrees to turn over any "adequate protection" of the
trustee's interest in any Collateral securing the Senior Bank Debt that it
receives in any bankruptcy or insolvency proceeding to the senior bank
agent to the extent necessary to make whole the senior bank agent and the
holders of Senior Bank Debt,
(8) the trustee will not seek to have the automatic stay lifted in any
bankruptcy proceeding as to any collateral securing the Senior Bank Debt,
(9) the trustee agrees not to appoint a Chapter 11 trustee under
Section 1104 of the Bankruptcy Code or to convert or dismiss a bankruptcy
proceeding under Section 1112 of the Bankruptcy Code,
(10) the trustee waives in any bankruptcy proceeding any claim it may
have under Section 1111(b) of the Bankruptcy Code (including any claim
arising by an election by the holders of Senior Bank Debt under Section
1111(b)(2) of the Bankruptcy Code and/or any borrowing or grant of a
security interest under Section 364 by Metal Management or any Subsidiary
Guarantor, as debtor in possession),
(11) the senior bank agent and the trustee each agree not to take any
action or vote inconsistent with the intercreditor agreement,
(12) the trustee agrees that the senior bank agent will have the sole
and exclusive right to adjust settlement for insurance coverage on
collateral securing the Senior Bank Debt and that proceeds of insurance or
condemnation proceedings with respect to such collateral will be paid to
the senior bank agent,
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(13) that if the trustee or any holder of a note receives proceeds of
Collateral other than as expressly permitted by the intercreditor
agreement, such proceeds will be received by such Person in trust and
turned over to the senior bank agent,
(14) subject to certain exceptions, in the event that the senior bank
agent releases or agrees to release its Lien on any Collateral, and sends
the trustee notice thereof in writing, which notice states that Collateral
will be sold free and clear of the Liens of the senior bank agent and the
trustee, the trustee will be deemed to have consented to such sale and the
Lien of the trustee on such Collateral shall be automatically released and
terminated,
(15) the trustee waives any right to marshaling of the collateral
securing the Senior Bank Debt, and
(16) the trustee, on behalf of the trustee and on behalf of the
Holders of the notes, will not directly or indirectly seek to foreclose or
realize upon, judicially or non-judicially, any Collateral or take any
other enforcement action against or in respect of the Collateral, unless
and until the Obligations under the Senior Credit Facility have been
indefeasibly paid in full in cash and all commitments to extend Senior Bank
Debt have terminated.
OPTIONAL REDEMPTION
The notes are not redeemable at Metal Management's option prior to June 15,
2000. From and after June 15, 2000, the notes will be subject to redemption at
the option of Metal Management, in whole or in part, in an aggregate minimum
principal amount of $10.0 million and integral multiples of $10.0 million, upon
not less than 30 nor more than 60 days' written notice, at a redemption price
equal to 100% of the aggregate principal amount thereof, plus accrued and unpaid
interest and liquidated damages, if any, thereon to the applicable redemption
date.
SELECTION AND NOTICE
Notices of redemption shall be mailed by first class mail at least 30 but
not more than 60 days before the redemption date to each Holder of notes to be
redeemed at such Holder's registered address. If any note is to be redeemed in
part only, the notice of redemption that relates to such note shall state the
portion of the principal amount thereof to be redeemed. A replacement note in
principal amount equal to the unredeemed portion thereof will be issued in the
name of the Holder thereof upon cancellation of the original note. On and after
the redemption date, unless Metal Management defaults in payment of the
redemption price, interest ceases to accrue on notes or portions of notes called
for redemption.
MANDATORY REDEMPTION
Except as set forth below under "--Repurchase at the Option of Holders,"
Metal Management is not required to make mandatory redemption or sinking fund
payments with respect to the notes.
REPURCHASE AT THE OPTION OF HOLDERS
CHANGE OF CONTROL
Upon the occurrence of a Change of Control, each Holder of notes will have
the right to require Metal Management to repurchase all or any part (of at least
$1,000 principal amount or an integral multiple thereof) of such Holder's notes
pursuant to the offer described below (the "Change of Control Offer") at an
offer price in cash (the "Change of Control Payment") equal to 101% of the
aggregate principal amount thereof plus accrued and unpaid interest and
liquidated damages, if any, thereon to the date of purchase. Within 30 days
following any Change of Control, Metal Management will mail a notice to each
Holder describing the transaction or transactions that constitute the Change of
Control and offering to repurchase notes pursuant to the procedures required by
the indenture and described in such notice.
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On the date of the Change of Control Payment, Metal Management will, to the
extent lawful:
(1) accept for payment all notes or portions thereof properly tendered
pursuant to the Change of Control Offer,
(2) deposit with the paying agent an amount equal to the Change of
Control Payment in respect of all notes or portions thereof so tendered,
and
(3) deliver or cause to be delivered to the trustee for cancellation
the notes so accepted together with an Officer's Certificate stating the
aggregate principal amount of notes or portions thereof being repurchased
by Metal Management.
The paying agent will promptly mail to each Holder of notes so tendered the
Change of Control Payment for such notes, and the trustee will promptly
authenticate and mail (or cause to be transferred by book entry) to each Holder
a replacement note equal in principal amount to any unpurchased portion of the
notes surrendered, if any; provided that each such replacement note will be in a
principal amount of $1,000 or an integral multiple thereof. Metal Management
will publicly announce the results of the Change of Control Offer on or as soon
as practicable after the date of the Change of Control Payment.
The Change of Control provisions described above will be applicable whether
or not any other provisions of the indenture are applicable. Except as described
above with respect to a Change of Control, the indenture does not contain
provisions that permit the Holders of the notes to require that Metal Management
repurchase or redeem the notes in the event of a takeover, recapitalization or
similar transaction.
Metal Management will not be required to make a Change of Control Offer
upon a Change of Control if a third party makes the Change of Control Offer in
the manner, at the times and otherwise in compliance with the requirements set
forth in the indenture applicable to a Change of Control Offer made by Metal
Management and repurchases all notes validly tendered and not withdrawn under
such Change of Control Offer.
The existence of a Holder's right to require Metal Management to repurchase
such Holder's notes upon the occurrence of a Change of Control may deter a third
party from seeking to acquire Metal Management in a transaction that would
constitute a Change of Control.
Metal Management will comply with the requirements of Rule 14e-1 under the
Securities Exchange Act of 1934 and any other securities laws and regulations
thereunder to the extent such laws and regulations are applicable in connection
with the repurchase of the notes as a result of a Change of Control. To the
extent that the provisions of any securities laws or regulations conflict with
the Change of Control provisions of the indenture, Metal Management shall comply
with applicable securities laws and regulations and shall not be deemed to have
breached its obligations under the Change of Control provisions of the indenture
by virtue thereof.
ASSET SALES
The indenture will provide that Metal Management will not, and will not
permit any of its Restricted Subsidiaries to, cause or make an Asset Sale
unless:
(1) Metal Management (or the Restricted Subsidiary, as the case may
be) receives consideration at the time of such Asset Sale at least equal to
the Fair Market Value (evidenced by a resolution of the Board of Directors,
which in the case of an Asset Sale with a Fair Market Value exceeding $5
million, shall be set forth in an Officer's Certificate delivered to the
trustee) of the assets or Equity Interests issued or sold or otherwise
disposed of,
(2) at least 75% of the consideration therefor received by Metal
Management or such Restricted Subsidiary is in the form of Cash
Equivalents; provided that the amount of:
(a) any liabilities (as shown on Metal Management's or such
Restricted Subsidiary's most recent balance sheet) of Metal Management
or any Restricted Subsidiary (other than contingent
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liabilities and liabilities that are by their terms subordinated to the
notes or any Guarantee thereof) that are assumed by the transferee of
any such assets pursuant to a customary novation agreement that releases
Metal Management or such Restricted Subsidiary from further liability,
and
(b) any notes or other obligations received by Metal Management or
any such Restricted Subsidiary from such transferee that are immediately
converted by Metal Management or such Restricted Subsidiary into cash
(to the extent of the cash received),
shall be deemed to be cash for purposes of this clause (2), and
(3) Metal Management or such Restricted Subsidiary shall apply the Net
Proceeds of such Asset Sale within 270 days of receipt thereof as follows:
(a) to the extent such Net Proceeds are received from an Asset Sale
not involving the sale, transfer or disposition of Collateral
("Non-Collateral Proceeds") or such proceeds are received from an Asset
Sale involving the sale, transfer or disposition of Collateral that is
subject to a Prior Lien ("Prior Lien Collateral Proceeds"), to satisfy
all mandatory repayment obligations of any Indebtedness secured by the
assets involved in such Asset Sale together with a concomitant permanent
reduction in the amount of such Indebtedness (including a permanent
reduction in committed amounts therefor in the case of any revolving
credit facility so repaid); and
(b) with respect to any Non-Collateral Proceeds or Prior Lien
Collateral Proceeds remaining after application pursuant to the
preceding clause (3)(a) and any Net Proceeds received from an Asset Sale
involving the sale, transfer or disposition of Collateral not subject to
the provisions of clause (3)(a) above ("Collateral Proceeds", and,
together with such remaining Non-Collateral Proceeds and Prior Lien
Collateral Proceeds, the "Available Proceeds Amount"), Metal Management
shall make an offer to purchase (the "Asset Sale Offer") from all
Holders up to a maximum principal amount (expressed as an integral
multiple of $1,000) of notes equal to the Available Proceeds Amount at a
purchase price in cash equal to 100% of the principal amount thereof
plus accrued and unpaid interest thereon, if any, and liquidated
damages, if any, to the date fixed for such purchase in accordance with
the procedures set forth in the indenture; provided that Metal
Management will not be required to apply pursuant to this clause (3)(b)
Net Proceeds received from any Asset Sale if, and only to the extent
that, such Net Proceeds are applied (or, in the case of clauses
(3)(b)(i) or (3)(b)(ii) below, Metal Management (or such Restricted
Subsidiary) enters into a binding, definitive agreement) to apply)
within 270 days of such Asset Sale the Net Proceeds from such Asset
Sale:
(i) to the acquisition of a controlling interest in any one or
more businesses, to the making of a capital expenditure (including
the construction or improvement of properties and capital assets) or
the acquisition of long-term assets, in each case, that is engaged in
or that is used or useful in a Principal Business, and/or
(ii) to an investment in properties or assets that replace the
properties and assets that are the subject of such Asset Sale
(collectively, clause (i) and (ii) of this paragraph, a "Permitted
Related Acquisition"), and/or
(iii) to permanently reduce Obligations under the Senior Credit
Facility (and to correspondingly reduce commitments with respect
thereto) and, if the Net Proceeds so invested in such Permitted
Related Acquisition included Collateral Proceeds or Prior Lien
Collateral Proceeds, the property and assets constituting such
Permitted Related Acquisition and any non-cash consideration received
as a result of such Asset Sale are made subject to the Lien securing
the notes in the manner contemplated in the indenture and the
Security Documents.
If at any time any non-cash consideration received by Metal Management or
any Restricted Subsidiary of Metal Management, as the case may be, in connection
with any Asset Sale is converted into
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or sold or otherwise disposed of for cash, then such conversion or disposition
shall be deemed to constitute an Asset Sale hereunder and the Net Proceeds
thereof shall be applied in accordance with this covenant. Metal Management may
defer the Asset Sale Offer until there is an aggregate unutilized Available
Proceeds Amount in excess of $10.0 million resulting from one or more Asset
Sales, at which time the entire unutilized Available Proceeds Amount, and not
just the amount in excess of $10.0 million, shall be applied to the Asset Sale
Offer. To the extent that the aggregate amount of notes tendered pursuant to an
Asset Sale Offer exceeds the unutilized Available Proceeds Amount, the trustee
shall select the notes to be purchased on a pro rata basis. Upon completion of
any such Asset Sale Offer, the unutilized Available Proceeds Amount shall be
reset to zero. Metal Management shall commence an Asset Sale Offer within ten
business days of receipt of such amount by mailing the notice required pursuant
to the terms of the indenture, with a copy to the trustee.
Notwithstanding any other provision of this covenant, in the event of an
Asset Sale by Metal Management or any Restricted Subsidiary of Southern
Recycling, L.L.C. that is consummated prior to such time when Southern
Recycling, L.L.C. becomes a Subsidiary of Metal Management or any Restricted
Subsidiary, such Asset Sale shall not be subject to, or otherwise required to
comply with, clauses (1) or (2) of the first paragraph of "--Repurchase at the
Option of Holders--Asset Sales;" provided, however, such Asset Sale shall be
subject to, and otherwise required to comply with, all other provisions of
"--Repurchase at the Option of Holders--Asset Sales." From and after such time
when Southern Recycling, L.L.C. becomes a Subsidiary of Metal Management or a
Restricted Subsidiary, an Asset Sale relating to Southern Recycling, L.L.C.,
shall be subject to and in compliance with all of the provisions described under
"--Repurchase at the Option of Holders--Asset Sales."
To the extent the Senior Bank Debt is secured by a Lien on the unutilized
Available Proceeds Amount, the notes shall be secured by a Lien on such
unutilized Available Proceeds Amount (which Lien shall be junior and
subordinated to the Lien securing the Senior Bank Debt) and such unutilized
Available Proceeds Amount shall constitute Collateral in accordance with the
Security Documents. To the extent such Lien shall be released under the terms of
the Senior Credit Facility, the Liens in favor of the trustee and the
noteholders on such Available Proceeds Amount shall be released, and the
unutilized Available Proceeds Amount may be applied for any purpose not
prohibited by the indenture, including the repurchase of Senior Subordinated
Notes in accordance with the indenture governing such Senior Subordinated Notes.
The Senior Credit Facility currently prohibits Metal Management from
repurchasing any notes under certain circumstances, and also provides that
certain change of control events with respect to Metal Management would
constitute a default thereunder. Any future credit agreements or other
agreements relating to Pari Passu Indebtedness to which Metal Management becomes
a party may contain similar provisions. In the event a Change of Control or
Asset Sale Offer occurs at a time when Metal Management is prohibited from
repurchasing notes, Metal Management could seek the consent of the lenders under
the Senior Credit Facility or such future agreements relating to Pari Passu
Indebtedness to the purchase of notes or could attempt to refinance the
borrowings that contain such prohibition. In addition, the occurrence of a
Change of Control or an Asset Sale may require Metal Management to make an offer
to purchase the Senior Subordinated Notes under the indenture pursuant to which
the Senior Subordinated Notes were issued. If Metal Management does not obtain
such a consent or repay such borrowings, Metal Management will remain prohibited
from purchasing notes. In such case, Metal Management's failure to make such
offer or to repurchase tendered notes would constitute an Event of Default under
the indenture. See "--Events of Default and Remedies."
Metal Management will comply with the requirements of Rule 14e-1 under the
Securities Exchange Act of 1934 and any other securities laws and regulations
thereunder to the extent such laws and regulations are applicable in connection
with the repurchase of the notes as a result of an Asset Sale. To the extent
that the provisions of any securities laws or regulations conflict with the
Asset Sale provisions of the indenture, Metal Management shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under the Asset Sales provisions by virtue thereof.
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CERTAIN COVENANTS
RESTRICTED PAYMENTS
The indenture provides that Metal Management will not, and will not permit
any of its Restricted Subsidiaries to, directly or indirectly:
(1) declare or pay any dividend or make any other payment or
distribution on account of Metal Management's Equity Interests (other than
dividends or distributions payable in Equity Interests (other than
Disqualified Stock) of Metal Management);
(2) purchase, redeem, defease or otherwise acquire or retire for value
any Equity Interests of Metal Management or any direct or indirect parent
of Metal Management;
(3) make any principal payment on, or purchase, redeem, defease or
otherwise acquire or retire for value any Subordinated Indebtedness, except
at final maturity or scheduled installment or sinking fund payments; or
(4) make any Restricted Investment (all such payments and other
actions set forth in clauses (1) through (4) above being collectively
referred to as "Restricted Payments"),
unless, at the time of and after giving effect to such Restricted Payment:
(1) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof;
(2) Metal Management would, at the time of such Restricted Payment and
immediately after giving pro forma effect thereto as if such Restricted
Payment had been made at the beginning of the applicable four-quarter
period, have been permitted to incur at least $1.00 of additional
Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in
the first paragraph of the covenant described below under the caption
"--Incurrence of Indebtedness and Issuance of Disqualified Stock;" and
(3) the amount of such Restricted Payment, together with the aggregate
amount of all other Restricted Payments made by Metal Management and its
Restricted Subsidiaries after May 7, 1999 (including Restricted Payments
permitted by clauses (1), (4), (6) and (8) of the next succeeding
paragraph, but excluding all other Restricted Payments permitted by the
next succeeding paragraph), is less than the sum of:
(a) 50% of the Consolidated Net Income of Metal Management for the
period (taken as one accounting period) from July 1, 1998 to the end of
Metal Management's most recently ended fiscal quarter for which internal
financial statements are available at the time of such Restricted
Payment (or, if such Consolidated Net Income for such period is a
deficit, less 100% of such deficit), plus
(b) 100% of the aggregate net cash proceeds received by Metal
Management from the issue or sale since May 13, 1998 of Equity Interests
of Metal Management (including the net cash proceeds of any exercise or
conversion payments with respect to Equity Interests) or of Disqualified
Stock or debt securities of Metal Management that have been converted
into such Equity Interests (other than Equity Interests, Disqualified
Stock or convertible debt securities of Metal Management sold to a
Restricted Subsidiary of Metal Management and other than Disqualified
Stock or debt securities that have been converted into Disqualified
Stock), plus
(c) 100% of the aggregate amounts contributed to the capital of
Metal Management since May 13, 1998, plus
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(d) to the extent that any Restricted Investment that was made
after May 13, 1998 was sold for cash or was repaid, the lesser of:
(i) the cash return of capital with respect to such Restricted
Investment (less the cost of disposition, if any), and
(ii) the initial amount of such Restricted Investment, plus
(e) without duplication, to the extent that any Unrestricted
Subsidiary is or was designated by Metal Management as a Restricted
Subsidiary, an amount equal to the lesser of:
(i) the net book value of Metal Management's Investment in such
Unrestricted Subsidiary at the time of such designation, and
(ii) the Fair Market Value of such Investment at the time of
such designation, plus
(f) 50% of any cash dividends received by Metal Management or a
Restricted Subsidiary of Metal Management (except to the extent that
such dividends were already included in Consolidated Net Income and, in
the case of a Restricted Subsidiary, only to the extent of Metal
Management's ownership interest in such Restricted Subsidiary) after May
13, 1998 from an Unrestricted Subsidiary of Metal Management.
The foregoing provisions will not prohibit:
(1) the payment of any dividend or redemption payment within 60 days
after the date of declaration thereof, if at the date of declaration such
payment would have complied with the provisions of the indenture;
(2) the redemption, repurchase, retirement or other acquisition of any
Equity Interests of Metal Management or any Restricted Subsidiary or any
Subordinated Indebtedness of Metal Management in exchange for, or out of
the proceeds of, the substantially concurrent sale (other than to a
Restricted Subsidiary of Metal Management) of Equity Interests of Metal
Management (other than any Disqualified Stock); provided that the amount of
any such net cash proceeds that are utilized for any such redemption,
repurchase, retirement or other acquisition shall be excluded from clause
(3)(b) of the preceding paragraph;
(3) the defeasance, redemption, repurchase, retirement or other
acquisition of Subordinated Indebtedness with the net cash proceeds from an
incurrence of Permitted Refinancing Indebtedness;
(4) the repurchase of the Senior Subordinated Notes in the event of an
Asset Sale or Change of Control (as defined in the indenture governing the
Senior Subordinated Notes (as in effect on the date of the indenture)) as
long as Metal Management complied with the provisions described under
"--Repurchase at the Option of Holders--Change of Control" or "--Repurchase
at the Option of Holders--Asset Sales," as applicable;
(5) repurchases of Equity Interests deemed to occur upon exercise of
stock options if such Equity Interests represent a portion of the exercise
price of such options;
(6) repurchases or redemptions of Equity Interests held by officers or
employees or former officers or employees of Metal Management or any
Restricted Subsidiary pursuant to any employment or other written
agreement, in an aggregate amount not to exceed $2.0 million in any fiscal
year, and any such repurchases or redemptions funded by life insurance
proceeds received by Metal Management upon the death of an insured officer
or employee;
(7) the acquisition by Metal Management of Equity Interests previously
issued and delivered to an escrow agent pursuant to an escrow agreement or
previously issued but never delivered pursuant to contingent or "earn-out"
payments, in each case in connection with the acquisition agreements of
Metal Management or any Subsidiary;
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(8) the payment of any dividend on, or the redemption of, Metal
Management Preferred Stock, in each case in accordance with the terms
thereof as in effect on May 13, 1998; provided that (other than in the case
of a dividend payable solely in Equity Interests of Metal Management) the
Fixed Charge Coverage Ratio for Metal Management for the most recently
ended four full fiscal quarters for which internal financial statements are
available immediately preceding the date of such payment, redemption,
repurchase, retirement or other acquisition would have been at least 2.0 to
1.0 determined on a pro forma basis, as if such payment, redemption,
repurchase, retirement or other acquisition, together with any other
payments, redemptions, repurchases, retirements and other acquisitions
permitted by this clause (8) occurring during the preceding twelve-month
period, had occurred at the beginning of the applicable four-quarter
period;
(9) guarantees of obligations of Unrestricted Subsidiaries or
Permitted Joint Ventures by Metal Management or a Restricted Subsidiary
(other than Obligations constituting Indebtedness of Metal Management or a
Restricted Subsidiary) to the extent that a cash Investment by Metal
Management or such Restricted Subsidiary would be permitted in such
Unrestricted Subsidiaries under this covenant; provided, however, that the
extension of any such guarantees shall be deemed to be an Investment by
Metal Management or such Restricted Subsidiary in an amount equal to the
obligations subject to the guarantees and shall be deemed to be made at the
time of such extension; and
(10) the making of other Restricted Payments not to exceed $10.0
million in the aggregate from and after May 13, 1998;
provided, further, that at the time of, and after giving effect to, any
Restricted Payment permitted under clauses (4), (5), (8) or (9) above, no
Default or Event of Default shall have occurred and be continuing or would occur
as a consequence thereof; and, provided, further, that for purposes of
determining the aggregate amount expended for Restricted Payments in accordance
with clause (3) of the immediately preceding paragraph, only the amounts
expended under clauses (1), (4), (6) and (8) shall be included.
As of the date of the indenture, all of Metal Management's Subsidiaries
will be Restricted Subsidiaries. Metal Management will not permit any
Unrestricted Subsidiary to become a Restricted Subsidiary except pursuant to the
last sentence of the definition of "Unrestricted Subsidiary." For purposes of
designating any Restricted Subsidiary as an Unrestricted Subsidiary, all
outstanding Investments by Metal Management and its Restricted Subsidiaries
(except to the extent repaid) in the Subsidiary so designated will be deemed to
be Restricted Payments in an amount equal to the Fair Market Value of such
Investment at the time of such designation. Such designation will only be
permitted if a Restricted Payment in such amount would be permitted to be made
at such time and if such Subsidiary otherwise meets the definition of an
Unrestricted Subsidiary. Unrestricted Subsidiaries will not be subject to any of
the restrictive covenants set forth in the indenture.
The amount of all Restricted Payments (other than cash) shall be the Fair
Market Value (evidenced by a resolution of the Board of Directors set forth in
an Officer's Certificate delivered to the trustee) on the date of the Restricted
Payment of the asset(s) proposed to be transferred by Metal Management or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
Not later than the date of making any Restricted Payment with a Fair Market
Value in excess of $5.0 million, Metal Management shall deliver to the trustee
an Officer's Certificate stating that such Restricted Payment is permitted and
setting forth the basis upon which the calculations required by the "Restricted
Payments" covenant were computed, which calculations may be based upon Metal
Management's latest available financial statements.
INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF DISQUALIFIED STOCK
The indenture provides that Metal Management will not, and will not permit
any of its Restricted Subsidiaries to, directly or indirectly, create, incur,
issue, assume, guarantee or otherwise become directly or indirectly liable,
contingently or otherwise, with respect to (collectively, "incur" and
correlatively, an "incurrence" of) any Indebtedness (including Acquired Debt)
and that Metal Management will not issue
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any Disqualified Stock and will not permit any of its Restricted Subsidiaries to
issue any shares of Preferred Stock; provided, however, that Metal Management
may incur Indebtedness (including Acquired Debt) or issue shares of Disqualified
Stock if the Fixed Charge Coverage Ratio for Metal Management for the most
recently ended four full fiscal quarters for which internal financial statements
are available immediately preceding the date of such incurrence would have been
at least 2.0 to 1.0 determined on a Pro Forma Basis.
The foregoing provisions will not apply to:
(1) the incurrence by Metal Management or any of its Restricted
Subsidiaries of indebtedness under the Senior Credit Facility and
Guarantees thereof by the Subsidiary Guarantors so long as, immediately
after any such incurrence, the aggregate principal amount outstanding under
the Senior Credit Facility (together with any Permitted Refinancing
Indebtedness incurred to refund, replace or refinance any Indebtedness
incurred pursuant to the Senior Credit Facility) pursuant to this clause
(1) does not exceed an amount equal to the greater of:
(a) $200.0 million, less the aggregate amount of all Loan
Reductions, and
(b) the sum of:
(i) 85% of the consolidated book value of the accounts
receivable of Metal Management and its Restricted Subsidiaries,
(ii) 70% of the consolidated book value of the inventory of
Metal Management and its Restricted Subsidiaries, and
(iii) the orderly liquidation value of Metal Management's
property, plant and equipment (initially $40.0 million), subject to
automatic and permanent reduction by $1.4 million each quarter,
commencing July 1, 1998, and subject to increases (but not in excess
of $40.0 million) based on increases in the orderly liquidation value
of Metal Management's property, plant and equipment resulting from
acquisitions completed by Metal Management (as set forth in the
appraisals accepted by the agent under the Senior Credit Facility and
provided that the automatic and permanent reduction described above
shall be increased by the amount of any such increase divided by 28);
provided, however, that in no event may the aggregate principal amount
outstanding under the Senior Credit Facility pursuant to this clause (1)
exceed $300.0 million; and provided, further, that the amount of
Indebtedness which may be incurred under the Senior Credit Facility
pursuant to this clause (1) shall be reduced by the principal amount of any
Acquired Debt incurred solely pursuant to clause (10) below;
(2) the incurrence by Metal Management or any of its Restricted
Subsidiaries of Indebtedness represented by the notes and the Subsidiary
Guarantees in an amount not to exceed $30.0 million;
(3) Guarantees by Metal Management or a Subsidiary Guarantor of
Indebtedness incurred by Metal Management or a Restricted Subsidiary of
Metal Management so long as the incurrence of such Indebtedness by the
primary obligor thereon was permitted under the terms of the indenture;
(4) the incurrence by Metal Management or a Restricted Subsidiary of
Metal Management of intercompany Indebtedness between or among Metal
Management and any of its Restricted Subsidiaries; provided, however, that
(a) all such intercompany Indebtedness is expressly subordinate to
the prior payment in full of all Obligations with respect to the notes
and the Subsidiary Guarantees, and
(b) (i) any subsequent issuance or transfer of Equity Interests
that results in any such intercompany Indebtedness being held by a
Person other than Metal Management or a Restricted Subsidiary, and
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(ii) any sale or transfer of any such intercompany Indebtedness
to a Person that is not either Metal Management or a Restricted
Subsidiary of Metal Management,
shall be deemed, in each case, to constitute an incurrence of such
Indebtedness by Metal Management or such Restricted Subsidiary, as the
case may be, that is not permitted by this clause (4);
(5) the incurrence by Metal Management or any Restricted Subsidiary of
Indebtedness (including reimbursement obligations relating thereto) in
respect of bid, payment or performance bonds, bankers' acceptances, letters
of credit and surety or appeal bonds, or guarantees of such obligations of
others, in the ordinary course of business,
(6) the issuance by a Restricted Subsidiary of Metal Management of any
shares of Preferred Stock to Metal Management or any of its Restricted
Subsidiaries; provided, however, that
(a) all such Preferred Stock is expressly subordinate to the prior
payment in full of all Obligations with respect to the notes and the
Subsidiary Guarantees, and
(b) (i) any subsequent issuance or transfer of Equity Interests that
results in any such Preferred Stock being held by a Person other than
Metal Management or a Restricted Subsidiary, and
(ii) any sale or transfer of any such shares of Preferred Stock
to a Person that is not either Metal Management or a Restricted
Subsidiary of Metal Management,
shall be deemed, in each case, to constitute an issuance of such
Preferred Stock by such Restricted Subsidiary that is not permitted by
this clause (6);
(7) Hedging Obligations of Metal Management or a Restricted Subsidiary
that are incurred:
(a) for the purpose of fixing or hedging interest rate risk with
respect to any Indebtedness that is permitted by the terms of the
indenture to be outstanding, or
(b) for the purpose of fixing or hedging currency exchange rate
risk with respect to any currency exchanges or commodity price risk with
respect to commodities utilized by Metal Management in the ordinary
course of business;
(8) subject to clause (1) above, the incurrence by Metal Management or
any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in
exchange for, or the net proceeds of which are used to extend, refinance,
renew, replace, defease or refund, Indebtedness that was permitted by the
indenture to be incurred;
(9) the incurrence of Indebtedness (but excluding any funded
Indebtedness) arising from agreements providing for indemnification,
adjustment of purchase price or similar Obligations, incurred or assumed in
connection with the acquisition or disposition of any business by Metal
Management or any Restricted Subsidiary;
(10) the incurrence of any Acquired Debt in an aggregate principal
amount permitted solely by this clause (10) not to exceed $25.0 million at
any one time outstanding;
(11) Capital Lease Obligations and Purchase Money Indebtedness of
Metal Management or any of its Restricted Subsidiaries (including any
Permitted Refinancing Indebtedness incurred to refund, replace or refinance
any Capital Lease Obligations or Purchase Money Indebtedness incurred
pursuant to this clause (11)) not to exceed $10.0 million at any one time
outstanding;
(12) the incurrence by Metal Management and any of its Restricted
Subsidiaries of Indebtedness represented by the Senior Subordinated Notes
and the Guarantees thereof in an amount not to exceed $180.0 million; and
(13) additional Indebtedness of Metal Management or any of its
Restricted Subsidiaries at any time outstanding equal to, if positive, (a)
$30.0 million, less (b) the sum of (i) the principal amount
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of the notes then outstanding, plus (ii) the principal amount of any
Permitted Refinancing Indebtedness incurred by Metal Management, the
proceeds of which are or were used to redeem or repurchase notes, and which
Permitted Refinancing Indebtedness is incurred by Metal Management solely
by reason of clause (8) above.
For purposes of determining compliance with this covenant, the accrual of
interest and the accretion of accreted value will not be deemed to be an
incurrence of Indebtedness.
Notwithstanding anything to the contrary in this covenant, Metal Management
and the Restricted Subsidiaries shall comply with the covenant described under
"--Limitation on Incurrence of Pari Passu Indebtedness."
Neither Metal Management nor any Subsidiary Guarantor will, directly or
indirectly, incur any Indebtedness which by its terms (or by the terms of any
agreement governing such Indebtedness) is subordinate in right of payment to any
other Indebtedness of Metal Management or such Subsidiary Guarantor, as the case
may be, unless such Indebtedness is also by its terms (or by the terms of any
agreement governing such Indebtedness) made expressly subordinate in right of
payment to the notes and the Subsidiary Guarantees pursuant to subordination
provisions that are substantially identical to the subordination provisions of
such other Indebtedness (or any agreement governing such Indebtedness) that are
most favorable to the holders of any other Indebtedness of Metal Management.
LIMITATION ON INCURRENCE OF PARI PASSU INDEBTEDNESS
So long as the Senior Credit Facility is outstanding and is secured by any
interest in Real Property (other than fixtures) of Metal Management or any
Restricted Subsidiary, Metal Management will not, and will not permit any of its
Restricted Subsidiaries to, incur any Pari Passu Indebtedness, unless prior to
such incurrence of Pari Passu Indebtedness, Metal Management executes and
delivers and causes the Restricted Subsidiaries to execute and deliver Mortgages
granting a Security Interest in, and valid mortgage Lien upon, all of the Real
Property of Metal Management and the Restricted Subsidiaries that from time to
time secures the Senior Bank Debt, which Security Interest shall be superior and
prior to the rights of all other Persons (including, without limitation, the
holders of any Pari Passu Indebtedness incurred pursuant to the provisions of
this covenant) in such Real Property other than Prior Liens; provided, however,
Metal Management and the Restricted Subsidiaries shall not be required to comply
with this covenant to the extent Pari Passu Indebtedness is incurred and such
Indebtedness is: (1) Indebtedness permitted by clauses (1) or (2) of the second
paragraph of the covenant entitled "--Incurrence of Indebtedness and Issuance of
Disqualified Stock" or (2) Indebtedness permitted by clauses (5), (7), (9), (10)
or (11) of the second paragraph of the covenant entitled "--Incurrence of
Indebtedness and Issuance of Disqualified Stock," so long as, in the case of
clause (2) of this covenant, the Pari Passu Indebtedness incurred pursuant to
clauses (5), (7), (9) and (10) of the second paragraph of the covenant entitled
"--Incurrence of Indebtedness and Issuance of Disqualified Stock" does not
exceed $5.0 million, in the aggregate, at any time outstanding and so long as,
in the case of clause (2) of this covenant, all Pari Passu Indebtedness incurred
pursuant to clauses (5), (7), (9), (10) and (11) of the second paragraph of the
covenant entitled "--Incurrence of Indebtedness and Issuance of Disqualified
Stock" does not exceed $10.0 million, in the aggregate, at any time outstanding.
SALE AND LEASEBACK TRANSACTIONS
The indenture provides that Metal Management will not, and will not permit
any of its Restricted Subsidiaries to, enter into any sale and leaseback
transaction; provided that Metal Management may enter into a sale and leaseback
transaction involving only the sale or transfer of assets not constituting
Collateral if:
(1) Metal Management could have (a) incurred Indebtedness in an amount
equal to the Attributable Debt relating to such sale and leaseback
transaction pursuant to the Fixed Charge Coverage Ratio test set forth in
the first paragraph of the covenant described above under the caption
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"--Incurrence of Indebtedness and Issuance of Disqualified Stock" and (b)
incurred a Lien to secure such Indebtedness pursuant to the covenant
described below under the caption "--Liens,"
(2) the gross cash proceeds of such sale and leaseback transaction are
at least equal to the Fair Market Value (as determined in good faith by the
Board of Directors and, in the case of a sale and leaseback transaction
having a Fair Market Value in excess of $5.0 million, set forth in an
Officer's Certificate delivered to the trustee) of the property that is the
subject of such sale and leaseback transaction, and
(3) the transfer of assets in such sale and leaseback transaction is
permitted by, and Metal Management applies the proceeds of such transaction
in compliance with, the covenant described under the caption "--Repurchase
at the Option of Holders--Asset Sales."
LIENS
The indenture provides that Metal Management will not, and will not permit
any of its Restricted Subsidiaries to, directly or indirectly, create, incur,
assume or suffer to exist any Lien (1) upon any item of Collateral other than
the Liens created by the notes, the Subsidiary Guarantees, the indenture and the
Security Documents and the Permitted Liens (including, without limitation, the
Liens securing the Senior Bank Debt) and (2) upon any other asset or property
(other than Real Property) now owned or hereafter acquired by Metal Management
or any of its Restricted Subsidiaries, which asset or property does not at such
time constitute Collateral, or any income or profits therefrom or assignment or
conveyance of any right to receive income therefrom, if, in the case of (2), (a)
such Lien secures obligations under any Subordinated Indebtedness, unless, the
notes are secured on a basis no less favorable than such Subordinated
Indebtedness is subordinated to the notes with the obligations so secured until
such time as such obligations are no longer secured by a Lien or (b) such Lien
secures obligations under Pari Passu Indebtedness at a time when the Senior
Credit Facility is no longer in effect, unless the notes are secured on a basis
that is pari passu with such Pari Passu Indebtedness so secured until such time
as such obligations are no longer secured by a Lien.
DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING RESTRICTED SUBSIDIARIES
The indenture provides that Metal Management will not, and will not permit
any of its Restricted Subsidiaries to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any encumbrance or
restriction on the ability of any Restricted Subsidiary to:
(1) (a) pay dividends or make any other distributions to Metal
Management or any of its Restricted Subsidiaries
(i) on its Capital Stock, or
(ii) with respect to any other interest or participation in, or
measured by, its profits, or
(b) pay any indebtedness owed to Metal Management or any of its
Restricted Subsidiaries,
(2) make loans or advances to Metal Management or any of its
Restricted Subsidiaries, or
(3) sell, lease or transfer any of its properties or assets to Metal
Management or any of its Restricted Subsidiaries, except for such
encumbrances or restrictions existing under or by reason of:
(a) Existing Indebtedness as in effect on May 7, 1999,
(b) the Senior Credit Facility as in effect on May 7, 1999, and any
amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings thereof, in whole
or in part; provided that such amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacement or
refinancings are no more restrictive in any material respect with
respect to such dividend and other payment restrictions than those
contained in the Senior Credit Facility as in effect on May 7, 1999,
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(c) the indenture, the notes and the Security Documents,
(d) applicable law,
(e) Indebtedness or Capital Stock of a Person acquired by Metal
Management or any of its Restricted Subsidiaries as in effect at the
time of such acquisition (except to the extent such Indebtedness was
incurred in connection with or in contemplation of such acquisition),
which encumbrance or restriction is not applicable to any Person, or the
properties or assets of any Person, other than the Person, or the
property or assets of the Person, so acquired; provided that, in the
case of Indebtedness, such Indebtedness was permitted by the terms of
the indenture to be incurred,
(f) by reason of nonassignment or net worth maintenance provisions
in leases entered into in the ordinary course of business,
(g) purchase money obligations for property acquired in the
ordinary course of business that impose restrictions of the nature
described in clause (3) above on the property so acquired, or
(h) Permitted Refinancing Indebtedness; provided that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are no more restrictive in any material respect
than those contained in the agreements governing the Indebtedness being
refinanced.
ADDITIONAL SUBSIDIARY GUARANTEES
The indenture provides that if:
(1) Metal Management acquires or creates any additional Subsidiary
that is a Restricted Subsidiary, and
(a) any such Restricted Subsidiary has assets or revenues in any
fiscal year in excess of $200,000, or
(b) any such Restricted Subsidiary previously in existence has
assets or revenues in any fiscal year in excess of $200,000, or
(c) any such Restricted Subsidiary, together with all other
Restricted Subsidiaries which are not Subsidiary Guarantors, has assets
or revenues in any fiscal year in excess of $1.0 million in the
aggregate, or
(2) any Restricted Subsidiary of Metal Management that is not a
Subsidiary Guarantor guarantees or otherwise, directly or indirectly,
provides credit support for any Indebtedness of Metal Management or any
Restricted Subsidiary or is a borrower under the Senior Credit Facility (in
each case described in clauses (1) and (2), except for Foreign
Subsidiaries),
Metal Management will cause such Restricted Subsidiary to execute and deliver to
the trustee a supplemental indenture and, if required by the provisions of the
indenture, the applicable Security Documents, each in form and substance
reasonably satisfactory to the trustee pursuant to which such Restricted
Subsidiary shall unconditionally guarantee all of Metal Management's Obligations
under the notes on the terms set forth in such supplemental indenture and shall
grant a Security Interest in the Collateral on the terms set forth in the
indenture and such Security Documents.
MERGER, CONSOLIDATION OR SALE OF ASSETS
The indenture provides that Metal Management may not consolidate or merge
with or into (whether or not Metal Management is the surviving corporation), or
sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of its properties or assets in one or more related
transactions to, another corporation, Person or entity unless:
(1) Metal Management is the surviving corporation or the entity or the
Person formed by or surviving any such consolidation or merger (if other
than Metal Management) or to which such sale, assignment, transfer, lease,
conveyance or other disposition shall have been made is a corporation
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organized or existing under the laws of the United States, any state
thereof or the District of Columbia;
(2) the entity or Person formed by or surviving any such consolidation
or merger (if other than Metal Management) or the entity or Person to which
such sale, assignment, transfer, lease, conveyance or other disposition
shall have been made assumes all the Obligations of Metal Management under
the notes, the indenture and the Security Documents pursuant to a
supplemental indenture in a form reasonably satisfactory to the trustee and
such entity or person shall have taken all steps necessary or reasonably
requested by the trustee to protect and perfect the Security Interests
granted or purported to be granted under the Security Documents;
(3) immediately after such transaction no Default or Event of Default;
exists;
(4) except in the case of a merger of Metal Management with or into a
Wholly Owned Restricted Subsidiary of Metal Management, Metal Management or
the entity or Person formed by or surviving any such consolidation or
merger (if other than Metal Management), or to which such sale, assignment,
transfer, lease, conveyance or other disposition shall have been made (a)
will have Consolidated Net Worth immediately after the transaction equal to
or greater than the Consolidated Net Worth of Metal Management immediately
prior to the transaction and (b) will, at the time of such transaction and
after giving pro forma effect thereto as if such transaction had occurred
at the beginning of the applicable four-quarter period, be permitted to
incur at least $1.00 of additional Indebtedness pursuant to the Fixed
Charge Coverage Ratio test set forth in the first paragraph of the covenant
described above under the caption "--Incurrence of Indebtedness and
Issuance of Disqualified Stock;"
(5) Metal Management shall have delivered to the trustee an Officers'
Certificate and an Opinion of Counsel each stating that (a) such
transaction and supplemental indenture comply with the provisions of this
paragraph, and (b) all conditions precedent herein provided for relating to
such transaction have been complied with; and
(6) all instruments of further assurance and all actions as are
necessary to maintain, preserve and protect the rights of the Holders of
the notes and the trustee hereunder and under each of the applicable
Security Documents with respect to the Security Interests have been taken.
The sale, assignment, transfer, lease, conveyance or other disposition by
Metal Management or its Restricted Subsidiaries of all or substantially all of
their respective property or assets to one or more of their Subsidiaries shall
not relieve either Metal Management or the Restricted Subsidiaries from their
respective obligations under the indenture or the notes. Subject to the
foregoing, any Restricted Subsidiary may consolidate with, merge into or
transfer all or part of its properties and assets to Metal Management or any
other Restricted Subsidiary or other entity that becomes, by reason of such
consolidation, merger or transfer, a Restricted Subsidiary.
TRANSACTIONS WITH AFFILIATES
The indenture provides that Metal Management will not, and will not permit
any of its Restricted Subsidiaries to, make any payment to, or sell, lease,
transfer or otherwise dispose of any of its properties or assets to, or purchase
any property or assets from, or enter into or make or amend any contract,
agreement, understanding, loan, advance or guarantee with, or for the benefit
of, any Affiliate (each of the foregoing, an "Affiliate Transaction"), unless:
(1) such Affiliate Transaction is on terms that are no less favorable
to Metal Management or the relevant Restricted Subsidiary than those that
might reasonably have been obtained in a comparable transaction by Metal
Management or such Restricted Subsidiary with an unrelated Person, and
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(2) Metal Management delivers to the trustee:
(a) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of
$2.0 million, a certificate of the Chief Executive Officer of Metal
Management certifying that such Affiliate Transaction complies with
clause (1) above,
(b) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of
$5.0 million, a resolution of the Board of Directors set forth in an
Officer's Certificate certifying that such Affiliate Transaction
complies with clause (1) above and that such Affiliate Transaction has
been approved by a majority of the disinterested members of the Board of
Directors, and
(c) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of
$10.0 million, an opinion as to the fairness to the Holders of the notes
of such Affiliate Transaction from a financial point of view issued by
an accounting, appraisal or investment banking firm of national
standing.
The foregoing provisions will not apply to the following:
(1) transactions between or among Metal Management and/or any of its
Restricted Subsidiaries in which no Affiliate of Metal Management owns
Capital Stock (other than directors' qualifying shares);
(2) Restricted Payments or Permitted Investments permitted by the
provisions of the indenture described above under the caption entitled
"-- Restricted Payments;" and
(3) the payment of reasonable and customary regular fees and
compensation (including compensation payable in Equity Interests) to, and
indemnity provided on behalf of, officers, directors, employees or
consultants of Metal Management or any Subsidiary or Permitted Joint
Venture of Metal Management.
LIMITATION ON ISSUANCES AND SALES OF CAPITAL STOCK OF WHOLLY OWNED
RESTRICTED SUBSIDIARIES
The indenture provides that Metal Management:
(1) will not, and will not permit any Wholly Owned Restricted
Subsidiary of Metal Management to, transfer, convey, sell, lease or
otherwise dispose of any Capital Stock of any Wholly Owned Restricted
Subsidiary of Metal Management to any Person (other than Metal Management
or a Wholly Owned Restricted Subsidiary of Metal Management), unless:
(a) such transfer, conveyance, sale, lease or other disposition is
of all the Capital Stock of such Wholly Owned Restricted Subsidiary, and
(b) the cash Net Proceeds from such transfer, conveyance, sale,
lease or other disposition are applied in accordance with the covenant
described above under the caption "-- Repurchase at the Option of
Holders--Asset Sales," and
(2) will not permit any Wholly Owned Restricted Subsidiary of Metal
Management to issue any of its Equity Interests (other than, if necessary,
shares of its Capital Stock constituting directors' qualifying shares) to
any Person other than to Metal Management or a Wholly Owned Restricted
Subsidiary of Metal Management.
BUSINESS ACTIVITIES
Metal Management will not, and will not permit any Restricted Subsidiary
to, engage in any business other than a Principal Business, except to such
extent as would not be material to Metal Management and its Restricted
Subsidiaries, taken as a whole.
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IMPAIRMENT OF SECURITY INTEREST
Neither Metal Management nor any of its Subsidiaries will take or knowingly
or negligently omit to take any action which action or omission would have the
result of adversely affecting or impairing the Security Interests in any
material respect, with respect to the Collateral other than as expressly
contemplated by the indenture and the Security Documents, and neither Metal
Management nor any of its Subsidiaries shall grant to any Person (other than to
the trustee on behalf of the trustee and the Holders) any Lien on the Collateral
other than Permitted Liens.
REPORTS
The indenture provides that, whether or not required by the rules and
regulations of the Securities and Exchange Commission, so long as any notes are
outstanding, Metal Management will furnish to the trustee:
(1) all quarterly and annual financial information that would be
required to be contained in a filing with the Securities and Exchange
Commission on Forms 10-Q and 10-K if Metal Management were required to file
such Forms, including a "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and, with respect to the annual
information only, a report thereon by Metal Management's certified
independent accountants, and
(2) all current reports that would be required to be filed with the
Securities and Exchange Commission on Form 8-K if Metal Management were
required to file such reports.
In addition, whether or not required by the rules and regulations of the
Securities and Exchange Commission, commencing immediately after the
consummation of the Exchange Offer contemplated by the Registration Rights
Agreement, Metal Management will file a copy of all such information and reports
with the Securities and Exchange Commission (which may be contained in Forms
10-K, 10-Q and 8-K) for public availability (unless the Securities and Exchange
Commission will not accept such a filing). In addition, Metal Management and the
Subsidiary Guarantors have agreed that, for so long as any notes remain
outstanding, they will furnish to the Holders and to securities analysts and
prospective investors, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act of 1933.
EVENTS OF DEFAULT AND REMEDIES
The indenture provides that each of the following constitutes an Event of
Default:
(1) default for 30 days in the payment when due of interest or
liquidated damages, if any, on the notes;
(2) default in payment when due of the principal of or premium, if
any, on the notes;
(3) failure by Metal Management to comply with the provisions
described above under the captions "--Repurchase at the Option of
Holders--Change of Control," "--Repurchase at the Option of Holders--Asset
Sales" or "--Certain Covenants--Merger, Consolidation or Sale of Assets;"
(4) failure by Metal Management for 60 days after notice from the
trustee or the Holders of at least 25% in aggregate principal amount of the
then outstanding notes to comply with any of its other covenants,
agreements or warranties in the indenture, the notes and the Security
Documents;
(5) default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by Metal Management or any of its
Restricted Subsidiaries (or the payment of which is guaranteed by Metal
Management or any of its Restricted Subsidiaries) whether such Indebtedness
or guarantee existed on the date of, or is created after the date of, the
indenture, which default results in the acceleration of such Indebtedness
prior to its express maturity and, in each case, the principal amount of
any such
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Indebtedness, together with the principal amount of any other such
Indebtedness the maturity of which has been so accelerated, aggregates
$10.0 million or more;
(6) failure by Metal Management or any of its Restricted Subsidiaries
to pay final judgments for the payment of money damages aggregating in
excess of $10.0 million, which judgments are not paid, discharged or stayed
for a period of 60 days;
(7) except as permitted by the indenture, any Significant Subsidiary
Guarantee shall be held in any judicial proceeding to be unenforceable or
invalid or shall cease for any reason to be in full force and effect
(except by its terms) or any Subsidiary Guarantor, or any Person acting on
behalf of any Subsidiary Guarantor, shall deny or disaffirm its obligations
under its Significant Subsidiary Guarantee, in each case if such default
continues for a period of ten days after notice to Metal Management from
the trustee or the Holders of at least 25% in aggregate principal amount of
the then outstanding notes;
(8) other than as permitted under the Security Documents or the terms
of the indenture, any of the Security Documents cease to be in full force
and effect, or any of the Security Documents cease to give the trustee the
Security Interests, rights, powers and privileges purported to be created
thereby, or any Security Document is declared null and void, or Metal
Management or any Significant Subsidiary Guarantor shall deny or disaffirm
any of its obligations under any Security Document or any Collateral
becomes subject to any Lien other than Permitted Liens; and
(9) certain events of bankruptcy or insolvency with respect to Metal
Management or any of its Significant Subsidiaries.
If any Event of Default (other than an Event of Default under clause (9) of
the preceding paragraph with respect to Metal Management) occurs and is
continuing, the trustee or the Holders of at least 25% in principal amount of
the then outstanding notes, by notice to the trustee and Metal Management, may
declare all the notes to be due and payable immediately. Notwithstanding the
foregoing, in the case of an Event of Default arising from certain events of
bankruptcy or insolvency described in clause (9) of the preceding paragraph,
with respect to Metal Management, any Significant Subsidiary or any group of
Subsidiaries that, taken together, would constitute a Significant Subsidiary,
all outstanding notes will become due and payable without further action or
notice. If an Event of Default exists solely by reason of an acceleration of
Indebtedness under clause (5) of the preceding paragraph, and such acceleration
is rescinded by the holders of such Indebtedness affected thereby prior to the
time the Obligations under the notes have been accelerated, such Event of
Default shall cease to exist. Holders of the notes may not enforce the indenture
or the notes except as provided in the indenture. Subject to certain
limitations, Holders of a majority in principal amount of the then outstanding
notes may direct the trustee in its exercise of any trust or power. The trustee
may withhold from Holders of the notes notice of any continuing Default or Event
of Default (except a Default or Event of Default relating to the payment of
principal, interest or liquidated damages, if any) if it determines that
withholding notice is in their interest.
The indenture provides that, at any time after a declaration of
acceleration with respect to the notes, the Holders of a majority in principal
amount of the notes may rescind and cancel such declaration and its consequences
if:
(1) the rescission would not conflict with any judgment or decree,
(2) all existing Events of Default have been cured or waived except
nonpayment of principal, interest or liquidated damages that has become due
solely because of the acceleration,
(3) to the extent the payment of such interest is lawful, interest on
overdue installments of interest and overdue principal at a rate equal to
the rate borne by the notes, which has become due otherwise than by such
declaration of acceleration, has been paid,
(4) Metal Management has paid the trustee its reasonable compensation
and reimbursed the trustee for its expenses, disbursements and advances,
and
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(5) in the event of the cure or waiver of an Event of Default of the
type described in clause (9) of the description above of Events of Default,
the trustee shall have received an Officer's Certificate and an opinion of
counsel that such Event of Default has been cured or waived.
No such rescission shall affect any subsequent Default or impair any right
consequent thereto.
The Holders of a majority in principal amount of the notes may waive any
existing Default or Event of Default under the indenture and its consequences,
except a default in the payment of the principal of or interest on, or
liquidated damages with respect to, any notes. Notwithstanding any other
provision of the indenture, the right of any Holder of a note to receive payment
of principal, premium and liquidated damages, if any, and interest on the notes,
on or after the respective due dates expressed in the notes (including in
connection with an offer to purchase), or to bring suit for the enforcement of
any such payment on or after such respective dates, shall not be impaired or
affected without the consent of such Holder except to the extent that the
institution or prosecution of such suit or the entry of judgment therein would,
under applicable law, result in the surrender, impairment or waiver of the Lien
of the indenture and the Security Documents upon the Collateral.
Metal Management is required to deliver to the trustee annually a statement
regarding compliance with the indenture, and Metal Management is required upon
becoming aware of any Default or Event of Default, to deliver to the trustee a
statement specifying such Default or Event of Default.
NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND STOCKHOLDERS
No director, officer, employee, incorporator or stockholder of Metal
Management or any Subsidiary Guarantor, as such, shall have any liability for
any obligations of Metal Management or the Subsidiary Guarantors under the
notes, the Subsidiary Guarantees, the indenture or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder of
notes by accepting a note waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the notes. Such waiver may
not be effective to waive liabilities under the federal securities laws and it
is the view of the Securities and Exchange Commission that such a waiver is
against public policy.
POSSESSION, USE AND RELEASE OF COLLATERAL
Unless an Event of Default shall have occurred and be continuing, subject
to the terms of the security documents securing the Senior Bank Debt, Metal
Management and the Subsidiaries of Metal Management will have the right to
remain in possession and retain exclusive control of the Collateral securing the
notes (other than any cash, securities, obligations and Cash Equivalents
constituting part of the Collateral and deposited with the senior bank agent in
accordance with the provisions of the intercreditor agreement), to freely
operate the Collateral and to collect, invest and dispose of any income thereon.
Release of Collateral. So long as the Senior Credit Facility is in effect,
the senior bank agent shall have the exclusive right and authority to determine
the release, sale, or other disposition with respect to the Collateral. Subject
to the terms of the intercreditor agreement, at any time or from time to time,
the Collateral securing the Senior Bank Debt is released or otherwise disposed
of pursuant to the terms of the Senior Credit Facility, the same Collateral
securing the notes shall be automatically released or disposed of; provided,
however, that in the event an Event of Default exists when the Senior Bank Debt
is repaid in full, the Collateral securing the notes and the Subsidiary
Guarantees shall not be released to the extent they were not disposed of in
order to repay the Senior Bank Debt in full (but in such event shall be released
when such Event of Default ceases to exist).
Disposition of Collateral Without Release. Notwithstanding the provisions
of "-- Release of Collateral" above, subject to the provisions of the Senior
Credit Facility, Metal Management and the Subsidiaries of Metal Management may,
without any release or consent by the senior bank agent or the trustee, do any
number of ordinary course activities in respect of the Collateral.
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LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Metal Management may, at its option and at any time, elect to have all of
its obligations discharged with respect to the outstanding notes ("Legal
Defeasance") except for:
(1) the rights of Holders of outstanding notes to receive payments in
respect of the principal of, premium and liquidated damages, if any, and
interest on such notes when such payments are due from the trust referred
to below,
(2) Metal Management's obligations with respect to the notes
concerning issuing temporary notes, registration of notes, mutilated,
destroyed, lost or stolen notes and the maintenance of an office or agency
for payment and money for security payments held in trust,
(3) the rights, powers, trusts, duties and immunities of the trustee,
and Metal Management's obligations in connection therewith, and
(4) the Legal Defeasance provisions of the indenture.
In addition, Metal Management may, at its option and at any time, elect to
have the obligations of Metal Management released with respect to certain
covenants that are described in the indenture ("Covenant Defeasance") and
thereafter any omission to comply with such obligations shall not constitute a
Default or Event of Default with respect to the notes. In the event Covenant
Defeasance occurs, certain events (not including nonpayment or certain
bankruptcy, receivership, rehabilitation and insolvency events) described above
under the caption "--Events of Default and Remedies" will no longer constitute
an Event of Default with respect to the notes.
In order to exercise either Legal Defeasance or Covenant Defeasance:
(1) Metal Management must irrevocably deposit with the trustee, in
trust, for the benefit of the Holders of the notes, cash in U.S. dollars,
non-callable Government Securities, or a combination thereof, in such
amounts as will be sufficient, in the opinion of a nationally recognized
firm of independent public accountants, to pay the principal of, premium
and liquidated damages, if any, and interest on the outstanding notes on
the stated maturity or on the applicable redemption date, as the case may
be, and Metal Management must specify whether the notes are being defeased
to maturity or to a particular redemption date;
(2) either:
(a) in the case of Legal Defeasance (other than when the notes are
being defeased within one year prior to the stated maturity or the
applicable maturity date), Metal Management shall have delivered to the
trustee an opinion of counsel in the United States reasonably acceptable
to the trustee confirming that:
(i) Metal Management has received from, or there has been
published by, the Internal Revenue Service a ruling, or
(ii) since May 7, 1999, there has been a change in the
applicable federal income tax law, in either case to the effect that,
and based thereon such opinion of counsel shall confirm that, the
Holders of the outstanding notes will not recognize income, gain or
loss for federal income tax purposes as a result of such Legal
Defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been
the case if such Legal Defeasance had not occurred, or
(b) in the case of Covenant Defeasance, Metal Management shall have
delivered to the trustee an opinion of counsel in the United States
reasonably acceptable to the trustee confirming that the Holders of the
outstanding notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Covenant Defeasance and will be
subject to federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such Covenant
Defeasance had not occurred;
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(3) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event of
Default resulting from the borrowing of funds to be applied to such
deposit) or insofar as Events of Default from bankruptcy or insolvency
events are concerned, at any time in the period ending on the 91st day
after the date of such deposit;
(4) such Legal Defeasance or Covenant Defeasance will not result in a
breach or violation of, or constitute a default under the Senior Credit
Facility or any other material agreement or instrument (other than the
indenture) to which Metal Management or any of its Restricted Subsidiaries
is a party or by which Metal Management or any of its Restricted
Subsidiaries is bound;
(5) Metal Management must have delivered to the trustee an opinion of
counsel to the effect that (assuming no intervening bankruptcy or
insolvency of Metal Management between the date of such deposit and the
91st day after such deposit and that no Holder is an insider of Metal
Management) after the 91st day following the deposit, the trust funds will
not be subject to the effect of any applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally;
(6) Metal Management must deliver to the trustee an Officer's
Certificate stating that the deposit was not made by Metal Management with
the intent of preferring the Holders of notes over the other creditors of
Metal Management with the intent of defeating, hindering, delaying or
defrauding creditors of Metal Management or others; and
(7) Metal Management must deliver to the trustee an Officer's
Certificate and an opinion of counsel, each stating that all conditions
precedent provided for or relating to the Legal Defeasance or the Covenant
Defeasance, as the case may be, have been complied with.
TRANSFER AND EXCHANGE
A Holder may transfer or exchange notes in accordance with the indenture.
The registrar and the trustee may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents and Metal Management may
require a Holder to pay any taxes and fees required by law or permitted by the
indenture. Metal Management is not required to transfer or exchange any note
selected for redemption. Also, Metal Management is not required to transfer or
exchange any note for a period of 15 days before a selection of notes to be
redeemed.
The registered Holder of a note will be treated as the owner of it for all
purposes.
FORM, DENOMINATION, TRANSFER, EXCHANGE AND BOOK-ENTRY PROCEDURES
The old notes were offered and sold to qualified institutional buyers in
reliance on Rule 144A. The old notes are represented by a global note in fully
registered form, without interest coupons, in denominations of $1,000 and
integral multiples thereof. The global note representing the old notes was
deposited with the trustee, as custodian for DTC, and registered in the name of
Cede & Co. or such other nominee as DTC may designate.
The new notes will be issued in fully registered form, without interest
coupons. Except as described below, the new notes will be deposited with, or on
behalf of, DTC, and registered in the name of Cede & Co. as DTC's nominee. The
new notes will be in the form of a global new note certificate (the "Global New
Note") and will stay in the custody of the trustee pursuant to the FAST Balance
Certificate between DTC and the trustee.
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EXCHANGES OF INTERESTS IN GLOBAL NEW NOTE FOR CERTIFICATED NEW NOTES
A beneficial interest in a Global New Note may not be exchanged for a new
note in certificated form unless:
(1) DTC
(a) notifies Metal Management that it is unwilling or unable to
continue as depositary for the Global New Note, or
(b) has ceased to be a clearing agency registered under the
Securities Exchange Act of 1934, and in either case Metal Management
thereupon fails to appoint a successor depositary,
(2) Metal Management, at its option, notifies the trustee in writing
that it elects to cause the issuance of the new notes in certificated form,
or
(3) there shall have occurred and be continuing an Event of Default or
any event which after notice or lapse of time or both would be an Event of
Default with respect to the new notes.
In all cases, certificated new notes delivered in exchange for the Global
New Note or beneficial interests therein will be registered in the names, and
issued in any approved denominations, requested by or on behalf of the
depositary (in accordance with its customary procedures). Any certificated new
note issued in exchange for an interest in the Global New Note will bear the
legend restricting transfers that is borne by such Global New Note. Any such
exchange will be effected through the DWAC System and an appropriate adjustment
will be made in the records of the security registrar to reflect a decrease in
the principal amount of the Global New Note.
DEPOSITORY PROCEDURES
DTC has advised Metal Management that DTC is a limited-purpose trust
company created to hold securities for its participating organizations
(collectively, the "Participants") and to facilitate the clearance and
settlement of transactions in those securities between Participants through
electronic book-entry changes in accounts of its Participants. The Participants
include securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations. Access to DTC's system is also
available to other entities such as banks, brokers, dealers and trust companies
that clear through or maintain a custodial relationship with a Participant,
either directly or indirectly (collectively, the "Indirect Participants").
Persons who are not Participants may beneficially own securities held by or on
behalf of DTC only through the Participants or the Indirect Participants. The
ownership interests and transfer of ownership interests of each actual purchaser
of each security held by or on behalf of DTC are recorded on the records of the
Participants and Indirect Participants.
DTC has also advised Metal Management that, pursuant to procedures
established by it, (1) upon deposit of the Global New Note, DTC will credit the
respective accounts of Participants in the principal amount at maturity of the
new notes of the individual beneficial interests represented by such Global New
Note and (2) ownership of such interests in the Global New Note will be shown
on, and the transfer of ownership thereof will be effected only through, records
maintained by DTC or its nominee (with respect to the Participants) or by the
Participants and the Indirect Participants (with respect to other owners of
beneficial interests in the Global New Note).
Investors in the Global New Note may hold their interests therein directly
through DTC, if they are participants in such system, or indirectly through
organizations (including Euroclear and CEDEL) which are participants in such
system. All interests in the Global New Note, including those held through
Euroclear or CEDEL, may be subject to the procedures and requirements of DTC.
Those interests held through Euroclear or CEDEL may also be subject to the
procedures and requirements of such systems. The laws of some states require
that certain persons take physical delivery in definitive form of securities
that they own. Consequently, the ability to transfer beneficial interests in the
Global New Note to such persons will be limited to that extent. Because DTC can
act only on behalf of Participants, which in turn act on behalf of Indirect
Participants and certain banks, the ability of a person having beneficial
interests
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in the Global New Note to pledge such interests to persons or entities that do
not participate in the DTC system, or otherwise take actions in respect of such
interests, may be affected by the lack of a physical certificate evidencing such
interests. For certain other restrictions on the transferability of the notes,
see "--Exchanges of Interests in the Global New Note for Certificated New
Notes."
EXCEPT AS DESCRIBED BELOW, OWNERS OF INTERESTS IN THE GLOBAL NEW NOTE WILL
NOT HAVE NEW NOTES REGISTERED IN THEIR NAMES, WILL NOT RECEIVE PHYSICAL DELIVERY
OF NEW NOTES IN CERTIFICATED FORM AND WILL NOT BE CONSIDERED THE REGISTERED
OWNERS OR HOLDERS THEREOF UNDER THE INDENTURE FOR ANY PURPOSE.
Payments in respect of the principal of and premium and interest on the
Global New Note registered in the name of DTC or its nominee will be payable by
the trustee to DTC in its capacity as the registered Holder under the indenture.
Under the terms of the indenture, Metal Management and the trustee will treat
the persons in whose names the new notes, including the Global New Note, are
registered as the owners thereof for the purpose of receiving such payments and
for any and all other purposes whatsoever. Consequently, neither Metal
Management, the trustee nor any agent of Metal Management or the trustee has or
will have any responsibility or liability for (1) any aspect of DTC's records or
any Participant's or Indirect Participant's records relating to or payments made
on account of beneficial ownership interests in the Global New Note, or for
maintaining, supervising or reviewing any of DTC's records or any Participant's
or Indirect Participant's records relating to the beneficial ownership interests
in the Global New Note or (2) any other matter relating to the actions and
practices of DTC or any of its Participants or Indirect Participants. DTC has
advised Metal Management that its current practice, upon receipt of any payment
in respect of securities such as the new notes (including principal and
interest), is to credit the accounts of the relevant Participants with the
payment on the payment date, in amounts proportionate to their respective
holdings in the principal amount of beneficial interests in the relevant
security as shown on the records of DTC unless DTC has reason to believe it will
not receive payment on such payment date. Payments by the Participants and the
Indirect Participants to the beneficial owners of new notes will be governed by
standing instructions and customary practices and will be the responsibility of
the Participants or the Indirect Participants and will not be the responsibility
of DTC, the trustee or Metal Management. Neither Metal Management nor the
trustee will be liable for any delay by DTC or any of its Participants in
identifying the beneficial owners of the new notes, and Metal Management and the
trustee may conclusively rely on and will be protected in relying on
instructions from DTC or its nominee for all purposes.
Except for trades involving only Euroclear and CEDEL participants,
interests in the Global New Note are expected to be eligible to trade in DTC's
Same-Day Funds Settlement System and secondary market trading activity in such
interests will therefore settle in immediately available funds, subject in all
cases to the rules and procedures of DTC and its participants.
Transfers between Participants in DTC will be effected in accordance with
DTC's procedures, and will be settled in same-day funds, and transfers between
participants in Euroclear and CEDEL will be effected in the ordinary way in
accordance with their respective rules and operating procedures.
Subject to compliance with the transfer restrictions applicable to the new
notes described herein, cross-market transfers between the Participants in DTC,
on the one hand, and Euroclear or CEDEL participants, on the other hand, will be
effected through DTC in accordance with DTC's rules on behalf of Euroclear or
CEDEL, as the case may be, by its respective depositary; however such
cross-market transactions will require delivery of instructions to Euroclear or
CEDEL, as the case may be, by the counterparty in such system in accordance with
the rules and procedures and within the established deadlines (Brussels time) of
such system. Euroclear or CEDEL, as the case may be, will, if the transaction
meets its settlement requirements, deliver instructions to its respective
depositary to take action to effect final settlement on its behalf by delivering
or receiving interests in the Global New Note in DTC, and making or receiving
payment in accordance with normal procedures for same-day funds settlement
applicable to DTC. Euroclear participants and CEDEL participants may not deliver
instructions directly to the depositories for Euroclear or CEDEL.
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Because of time zone differences, the securities account of a Euroclear or
CEDEL participant purchasing an interest in the Global New Note from a
Participant in DTC will be credited, and any such crediting will be reported to
the relevant Euroclear or CEDEL participant, during the securities settlement
processing day (which must be a business day for Euroclear and CEDEL)
immediately following the settlement date of DTC. DTC has advised Metal
Management that cash received in Euroclear or CEDEL as a result of sales of
interests in the Global New Note by or through a Euroclear or CEDEL participant
to a Participant in DTC will be received with value on the settlement date of
DTC but will be available in the relevant Euroclear or CEDEL cash account only
as of the business day for Euroclear or CEDEL following DTC's settlement date.
DTC has advised Metal Management that it will take any action permitted to
be taken by a Holder of new notes only at the direction of one or more
Participants to whose account with DTC interests in the Global New Note are
credited and only in respect of such portion of the aggregate principal amount
of the new notes as to which such Participant or Participants has or have given
such direction. However, if there is an Event of Default under the new notes,
DTC reserves the right to exchange the Global New Note for legended new notes in
certificated form, and to distribute such new notes to its Participants.
The information in this section concerning DTC, Euroclear and CEDEL and
their book-entry systems has been obtained from sources that Metal Management
believes to be reliable, but Metal Management takes no responsibility for the
accuracy thereof.
Although DTC, Euroclear and CEDEL have agreed to the foregoing procedures
to facilitate transfers of interests in the Global New Note among participants
in DTC, Euroclear and CEDEL, they are under no obligation to perform or to
continue to perform such procedures, and such procedures may be discontinued at
any time. Neither Metal Management nor the trustee will have any responsibility
for the performance by DTC, Euroclear or CEDEL or their respective participants
or indirect participants of their respective obligations under the rules and
procedures governing their operations.
REGISTRATION RIGHTS; LIQUIDATED DAMAGES
Metal Management, the Subsidiary Guarantors and the initial purchaser
entered into the registration rights agreement on May 7, 1999 (the "Closing
Date"). Pursuant to the registration rights agreement, Metal Management agreed
to file with the Securities and Exchange Commission, on or prior to 90 days
after the Closing Date, the exchange offer registration statement on the
appropriate form under the Securities Act of 1933 with respect to the Exchange
Notes. Upon the effectiveness of the exchange offer registration statement,
pursuant to the exchange offer, Metal Management will offer to the Holders of
Transfer Restricted Securities (as defined below) who are able to make certain
representations the opportunity to exchange their Transfer Restricted Securities
for Exchange Notes.
If:
(1) Metal Management is not permitted to file the exchange offer
registration statement or permitted to consummate the exchange offer
because the exchange offer is not permitted by applicable law or Securities
and Exchange Commission policy,
(2) the exchange offer is not consummated on or prior to the date by
which the exchange offer is required to have been consummated,
(3) any Holder of Transfer Restricted Securities notifies Metal
Management on or prior to the tenth business day following consummation of
the exchange offer that it (a) is prohibited by law or Securities and
Exchange Commission policy from participating in the exchange offer or (b)
may not resell the Exchange Notes acquired by it in the exchange offer to
the public without delivering a prospectus and the prospectus contained in
the exchange offer registration statement is not appropriate or available
for such resales or (c) is a broker-dealer and owns notes acquired directly
from Metal Management or an affiliate of Metal Management, or
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(4) Holders of not less than a majority in aggregate principal amount
of Transfer Restricted Securities shall notify Metal Management that they
reasonably determine that the interests of the Holders would be adversely
effected by the Consummation (as defined in the Registration Rights
Agreement) of the exchange offer,
Metal Management will file with the Securities and Exchange Commission a shelf
registration statement to cover resales of the notes by the Holders thereof who
satisfy certain conditions relating to the provision of information in
connection with the shelf registration statement.
Metal Management will use commercially reasonable efforts to cause the
applicable registration statement to be declared effective as promptly as
practicable by the Securities and Exchange Commission. For purposes of the
foregoing, "Transfer Restricted Securities" means each note until:
(1) the date on which such note has been exchanged by a person other
than a broker-dealer for an Exchange Note in the exchange offer so long as
such Exchange Note may be resold by such person without restrictions under
federal and state securities laws,
(2) following the exchange by a broker-dealer in the exchange offer of
a note for an Exchange Note, the date on which such Exchange Note is sold
to a purchaser who receives from such broker-dealer on or prior to the date
of such sale a copy of the prospectus contained in the exchange offer
registration statement,
(3) the date on which such note has been effectively registered under
the Securities Act of 1933 and disposed of in accordance with the shelf
registration statement, or
(4) the date on which such note is distributed to the public pursuant
to Rule 144 under the Securities Act of 1933 under circumstances in which
any legend borne by such note relating to restrictions on transferability
thereof, under the Securities Act of 1933 or otherwise, is removed or may
be removed.
Notwithstanding the foregoing, subject to the limitations contained in the
registration rights agreement, at any time after Consummation of the exchange
offer, Metal Management may allow the shelf registration statement to cease to
be effective and usable if the prospectus contained in the shelf registration
statement contains an untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided that the
period referred to in the registration rights agreement during which the shelf
registration statement is required to be effective and usable will be extended
by the number of days during which such registration statement was not effective
or usable pursuant to the foregoing provisions.
The registration rights agreement provides that:
(1) Metal Management will file an exchange offer registration
statement with the Securities and Exchange Commission on or prior to 90
days after the Closing Date,
(2) Metal Management will use commercially reasonable efforts to have
the exchange offer registration statement declared effective by the
Securities and Exchange Commission on or prior to 180 days after the
Closing Date (which 180-day period shall be extended for a number of days
equal to the number of business days, if any, that the Securities and
Exchange Commission is officially closed during such period),
(3) unless the exchange offer would not be permitted by applicable law
or Securities and Exchange Commission policy, Metal Management will
commence the exchange offer and use its commercially reasonable efforts to
issue on or prior to 25 business days after the date on which the exchange
offer registration statement was declared effective by the Securities and
Exchange Commission, Exchange Notes in exchange for all old notes tendered
prior thereto in the exchange offer, and
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(4) if obligated to file the shelf registration statement, Metal
Management will use its best efforts to file the shelf registration
statement with the Securities and Exchange Commission on or prior to 90
days after such filing obligation arises and to use commercially reasonable
efforts to cause the shelf registration statement to be declared effective
by the Securities and Exchange Commission on or prior to 180 days after
such filing obligation arises.
If:
(1) Metal Management fails to file either of the registration
statements required by the registration rights agreement on or before the
date specified for such filing,
(2) either of such registration statements is not declared effective
by the Securities and Exchange Commission on or prior to the date specified
for such effectiveness (the "Effectiveness Target Date"),
(3) Metal Management fails to consummate the exchange offer within 25
business days of the Effectiveness Target Date with respect to the exchange
offer registration statement, or
(4) subject to the last sentence of the preceding paragraph, the shelf
registration statement or the exchange offer registration statement is
declared effective but thereafter ceases to be effective or usable (other
than as described in the last sentence of the preceding paragraph) in
connection with resales of Transfer Restricted Securities during the
periods specified in the registration rights agreement (each such event
referred to in clauses (1) through (4) above a "Registration Default"),
then, subject to the last sentence of the preceding paragraph, Metal Management
will pay liquidated damages to each Holder of Transfer Restricted Securities
affected thereby, with respect to the first 90-day period immediately following
the occurrence of such Registration Default, in an amount equal to $0.05 per
week per $1,000 in principal amount of notes constituting Transfer Restricted
Securities held by such Holder. The amount of the liquidated damages will
increase by an additional $0.05 per week per $1,000 in principal amount of notes
constituting Transfer Restricted Securities with respect to each subsequent
90-day period until all Registration Defaults have been cured, up to a maximum
amount of liquidated damages of $0.50 per week per $1,000 in principal amount of
notes constituting Transfer Restricted Securities.
All accrued liquidated damages will be paid by Metal Management in cash to
persons entitled thereto on each Interest Payment Date to the Global Note Holder
(and any Holder of Certificated Securities who has given wire transfer
instructions to Metal Management prior to the Interest Payment Date) by wire
transfer of immediately available funds and to all other Holders of Certificated
Securities by mailing checks to their registered addresses. Following the cure
of all Registration Defaults, the accrual of liquidated damages will cease.
Holders of old notes will be required to make certain representations to
Metal Management (as described in the registration rights agreement) in order to
participate in the exchange offer and will be required to deliver information to
be used in connection with the shelf registration statement and to provide
comments on the shelf registration statement within the time periods set forth
in the registration rights agreement in order to have their old notes included
in the shelf registration statement and benefit from the provisions regarding
liquidated damages set forth above.
The summary herein of certain provisions of the registration rights
agreement does not purport to be complete and is subject to, and is qualified in
its entirety by reference to, all the provisions of the registration rights
agreement, a copy of which is filed as an exhibit to Metal Management's most
recent Annual Report on Form 10-K.
Except as described below under "--Amendment, Supplement and Waiver," the
old notes and the Exchange Notes will be considered collectively to be a single
class for all purposes under the indenture, including, without limitation,
waivers, amendments, redemptions and repurchase offers, and for purposes of this
"Description of the Notes" (except under this caption, "--Registration Rights;
Liquidated Damages") all reference herein to "notes" shall be deemed to refer
collectively to the old notes and any Exchange
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Notes, unless the context otherwise requires. The terms "new notes" and
"Exchange Notes" have the same meaning herein.
AMENDMENT, SUPPLEMENT AND WAIVER
Except as provided in the next two succeeding paragraphs, the indenture,
the notes and the Security Documents may be amended or supplemented with the
consent of the Holders of at least a majority in principal amount of the notes
then outstanding (including, without limitation, consents obtained in connection
with a purchase of, or tender offer or exchange offer for, notes), and any
existing default or compliance with any provision of the indenture, the notes,
or the Security Documents may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding notes (including consents
obtained in connection with a tender offer or exchange offer for notes).
Without the consent of each Holder affected, an amendment or waiver may not
(with respect to any notes held by a non-consenting Holder):
(1) reduce the principal amount of notes whose Holders must consent to
an amendment, supplement or waiver of this indenture, the notes or the
Security Documents,
(2) reduce the principal of or change the fixed maturity of any note
or alter the provisions with respect to the redemption of the notes (other
than provisions relating to the covenants described above under the caption
"--Repurchase at the Option of Holders"),
(3) reduce the rate of or change the time for payment of interest or
liquidated damages, if any, on any note,
(4) waive a Default or Event of Default, in each case in the payment
of principal of or premium or liquidated damages, if any, or interest on
the notes (except a rescission of acceleration of the notes by the Holders
of at least a majority in aggregate principal amount of the notes and a
waiver of the payment default that resulted from such acceleration),
(5) make any note payable in money other than that stated in the
notes,
(6) make any change in the provisions of the indenture relating to
waivers of past Defaults (other than to add sections of the indenture or
the notes which are subject thereto) or the rights of Holders of notes to
receive payments of principal of or premium or liquidated damages, if any,
or interest on the notes,
(7) waive a redemption payment with respect to any note (other than a
payment required by one of the covenants described above under the caption
"--Repurchase at the Option of Holders"),
(8) make any change in the foregoing amendment and waiver provisions,
(9) adversely affect the ranking of the notes or the Subsidiary
Guarantees,
(10) adversely affect Liens created by the indenture and the Security
Documents on the Collateral (other than in accordance with their terms) or
(11) release any Subsidiary Guarantor from its obligations under its
Subsidiary Guarantee (other than in accordance with the indenture).
Notwithstanding the foregoing, without the consent of any Holder of notes,
Metal Management and the trustee may amend or supplement the indenture, the
notes and the Security Documents to cure any ambiguity, defect or inconsistency,
to provide for uncertificated notes in addition to or in place of certificated
notes, to provide for the assumption of Metal Management's obligations to
Holders of notes in the case of a merger or consolidation, to make any change
that would provide any additional rights or benefits to the Holders of notes or
that does not adversely affect the legal rights under the indenture and the
Security Documents of any such Holder, to comply with requirements of the
Securities and Exchange Commission in order to effect or maintain the
qualification of the indenture under the Trust Indenture Act to mortgage, pledge
or grant a Security Interest in favor of the trustee as additional security for
the
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payment and performance of Obligations under this indenture, the notes and the
Subsidiary Guarantees, in any property or assets, including any which are
required to be mortgaged, pledged or hypothecated, or in which a Security
Interest is required to be granted pursuant to the provisions of the Security
Documents or otherwise; or to add or release any Subsidiary Guarantor or Pledgor
strictly in accordance with another provision of this indenture or a provision
of the Security Documents expressly providing for such addition or release.
CONCERNING THE TRUSTEE
The indenture contains certain limitations on the rights of the trustee,
should it become a creditor of Metal Management, to obtain payment of claims in
certain cases, or to realize on certain property received in respect of any such
claim as security or otherwise. The trustee will be permitted to engage in other
transactions; however, if it acquires any conflicting interest it must eliminate
such conflict within 90 days, and apply to the Securities and Exchange
Commission for permission to continue or resign.
The Holders of a majority in principal amount of the then outstanding notes
will have the right to direct the time, method and place of conducting any
proceeding for exercising any remedy available to the trustee, subject to
certain exceptions. The indenture provides that in case an Event of Default
shall occur (which shall not be cured), the trustee will be required, in the
exercise of its power, to use the degree of care of a prudent man in the conduct
of his own affairs. Subject to such provisions, the trustee will be under no
obligation to exercise any of its rights or powers under the indenture at the
request of any Holder, unless such Holder shall have offered to the trustee
security and indemnity satisfactory to it against any loss, liability or
expense.
ADDITIONAL INFORMATION
Anyone who receives this prospectus may obtain a copy of the indenture, the
registration rights agreement and the Security Documents without charge by
writing to Metal Management, Inc., 500 North Dearborn St., Suite 405, Chicago,
Illinois 60610; Attention: Chief Financial Officer.
CERTAIN DEFINITIONS
Set forth below are certain defined terms used in the indenture. Reference
is made to the indenture for a full disclosure of all such terms, as well as any
other capitalized terms used herein for which no definition is provided.
"Acquired Debt" means, with respect to any specified Person, (1)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Restricted Subsidiary of such specified Person,
including, without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Restricted Subsidiary of such specified Person, and (2) Indebtedness secured at
the time of acquisition thereof by a Lien encumbering any asset acquired by such
specified Person.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided that
beneficial ownership of 10% or more of the voting securities of a Person shall
be deemed to be control.
"Asset Sale" means:
(1) the sale, conveyance, transfer, assignment or other disposition
(whether in a single transaction or a series of related transactions) of
property or assets (including by way of a sale and leaseback) of Metal
Management or any Restricted Subsidiary, whether owned on the date of the
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indenture or subsequently acquired, to any Person other than Metal
Management or any Restricted Subsidiary of Metal Management (each referred
to in this definition as a "disposition"), or
(2) the issuance or sale of Equity Interests of any Restricted
Subsidiary (other than directors' qualifying shares) to any Person other
than Metal Management or any Restricted Subsidiary of Metal Management
(whether in a single transaction or a series of related transactions), in
each case set forth in these clauses (1) and (2), other than:
(a) a disposition of Cash Equivalents or tangible personal property
(including obsolete or redundant equipment) in the ordinary course of
business of Metal Management or the applicable Restricted Subsidiary;
(b) the disposition of all or substantially all of the assets of
Metal Management in a manner permitted pursuant to the provisions
described above under the caption "--Certain Covenants--Merger,
Consolidation or Sale of Assets" or any disposition that constitutes a
Change of Control pursuant to the indenture;
(c) any disposition that is a Restricted Payment or Permitted
Investment that is not prohibited under the covenant described above
under the caption "--Certain Covenants--Restricted Payments;" and
(d) any disposition, or related series of dispositions, of assets
with an aggregate Fair Market Value of less than $1.5 million.
"Attributable Debt" means, in respect of a sale and leaseback transaction,
at the time of determination, the present value (discounted at the rate of
interest implicit in such transaction, determined in accordance with GAAP) of
the obligation of the lessee for net rental payments during the remaining term
of the lease included in such sale and leaseback transaction (including any
period for which such lease has been extended or may, at the option of the
lessor, be extended).
"Board of Directors" means, as to any Person, the board of directors of
such Person or any duly authorized committee thereof.
"Capital Lease Obligation" means, at the time any determination thereof is
to be made, the amount of the liability in respect of a capital lease that would
at such time be required to be capitalized on a balance sheet of the lessee
thereof in accordance with GAAP.
"Capital Stock" means:
(1) in the case of a corporation, corporate stock,
(2) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock,
(3) in the case of a partnership, partnership interests (whether
general or limited) and
(4) any other interest or participation that confers on a Person the
right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person (excluding "earn-out" payments pursuant to
the acquisition agreements of Metal Management or any Subsidiary).
"Cash Equivalents" means:
(1) United States dollars,
(2) securities issued or directly and fully guaranteed or insured by
the United States government or any agency or instrumentality thereof
having maturities of not more than one year from the date of acquisition,
(3) certificates of deposit and time deposits with maturities of one
year or less from the date of acquisition, bankers' acceptances with
maturities not exceeding one year and overnight bank deposits, in each case
with any commercial bank having combined capital and surplus in excess of
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$200.0 million (or the foreign currency equivalent thereof) and whose
short-term commercial paper rating, or that of its parent holding company,
is at least "A-1" or the equivalent by Standard & Poor's Corporation and at
least "Prime-1" or the equivalent by Moody's Investors Service, Inc.,
(4) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clauses (2) and (3) above
entered into with any financial institution meeting the qualifications
specified in clause (3) above,
(5) shares of money market or similar funds which comply with Rule
2a-7 or any successor rule of the Securities and Exchange Commission, and
(6) commercial paper rated A-1 or higher by Standard & Poor's
Corporation or P-1 by Moody's Investors Service, Inc. and in each case
maturing within one year after the date of acquisition.
"Change of Control" means the occurrence of any of the following:
(1) the sale, lease or transfer, in one or a series of related
transactions (other than by merger or consolidation), of all or
substantially all of the assets of Metal Management and its Restricted
Subsidiaries, taken as a whole, to any "person" (as such term is used in
Section 13(d)(3) of the Securities Exchange Act of 1934);
(2) the adoption of a plan relating to the liquidation or dissolution
of Metal Management;
(3) (a) the acquisition by any Person or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934),
other than the Principals, of a direct or indirect interest in more than
35% of the voting power of the Voting Stock of Metal Management by way
of acquisition, merger or consolidation or otherwise, and
(b) the Principals beneficially owning, directly or indirectly, a
lesser percentage of the voting power of the Voting Stock of Metal
Management than such Person or group and the Principals not having the
right or ability by voting power, contract or otherwise to elect or
designate for election a majority of the Board of Directors of Metal
Management;
(4) a majority of the members of the Board of Directors of Metal
Management ceasing to be Continuing Directors; or
(5) any Person or group effecting a "Rule 13e-3 transaction" (within
the meaning of Rule 13e-3 under the Securities Exchange Act of 1934) with
respect to Metal Management.
"Collateral" means, collectively, all of the property and assets that are
from time to time subject to the Lien of the Security Documents, including the
Liens, if any, required to be granted under the covenant entitled '--Certain
Covenants--Limitation on Incurrence of Pari Passu Indebtedness" and otherwise
required pursuant to the provisions of the indenture.
"Company Preferred Stock" means the Series A Convertible Preferred Stock
and the Series B Convertible Preferred Stock of Metal Management outstanding on
the date of the indenture.
"Consolidated Cash Flow" means, with respect to any Person for any period,
the Consolidated Net Income of such Person for such period, plus
(1) an amount equal to any extraordinary or nonrecurring loss plus any
net loss realized, in each case, in connection with all Asset Sales (to the
extent such losses were deducted in computing such Consolidated Net
Income), plus
(2) provision for taxes based on income or profits of such Person and
its Restricted Subsidiaries for such period, to the extent that such
provision for taxes was deducted in computing such Consolidated Net Income,
plus
(3) consolidated interest expense of such Person and its Restricted
Subsidiaries for such period, whether paid or accrued and whether or not
capitalized (including, without limitation, amortization of original issue
discount, non-cash interest payments, the interest component of any
deferred payment
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obligations, the interest component of all payments associated with Capital
Lease Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect of
letter of credit or bankers' acceptance financings, and net payments (if
any) pursuant to Hedging Obligations), to the extent that any such expense
was deducted in computing such Consolidated Net Income, plus
(4) any Consolidated Non-Cash Charges that were deducted in computing
such Consolidated Net Income, less
(5) any non-cash items increasing Consolidated Net Income for such
period and, plus
(6) any cash dividends received by Metal Management or any of its
Restricted Subsidiaries which are paid by an Unrestricted Subsidiary.
"Consolidated Net Income" means, with respect to any Person for any period,
the aggregate of the Net Income of such Person and its Restricted Subsidiaries
for such period, on a consolidated basis, determined in accordance with GAAP;
provided that:
(1) the Net Income (but not loss) of any Person that is not a
Restricted Subsidiary or that is accounted for by the equity method of
accounting shall be included only to the extent of the amount of dividends
or distributions paid in cash to the referent Person or a Wholly Owned
Restricted Subsidiary thereof,
(2) the Net Income of any Restricted Subsidiary shall be excluded to
the extent that the declaration or payment of dividends or similar
distributions by that Restricted Subsidiary of that Net Income is not at
the date of determination permitted without any prior governmental approval
(that has not been obtained) or, directly or indirectly, by operation of
the terms of its charter or any agreement, instrument, judgment, decree,
order, statute, rule or governmental regulation applicable to that
Restricted Subsidiary or its stockholders,
(3) the cumulative effect of a change in accounting principles shall
be excluded, and
(4) the Net Income of any Unrestricted Subsidiary shall be excluded,
whether or not distributed to Metal Management or one of its Subsidiaries.
"Consolidated Net Worth" means, with respect to any Person as of any date,
the total of the following amounts of the Person and its Restricted
Subsidiaries, determined on a consolidated basis in accordance with GAAP as of
such date:
(1) the par or stated value of all outstanding Capital Stock of the
Person, plus
(2) paid-in capital or capital surplus relating to such Capital Stock,
plus
(3) any retained earnings or earned surplus, less
(a) any accumulated deficit, and
(b) any amounts attributable to Disqualified Stock.
"Consolidated Non-Cash Charges" means, with respect to any Person, for any
period, the aggregate depreciation and amortization (including (1) amortization
of goodwill, (2) any incremental increase in amortization of account inventory
resulting from write-ups of such inventory in connection with the purchase
accounting treatment of an acquisition and (3) amortization of other intangibles
and other noncash charges or amortization of a prepaid cash expense that was
paid in a prior period) of such Person and its Restricted Subsidiaries for such
period, in each case, determined on a consolidated basis in accordance with
GAAP.
"Continuing Directors" means, as of any date of determination, any member
of the Board of Directors of Metal Management who (1) was a member of such Board
of Directors on the date of the indenture or (2) was nominated for election or
elected to such Board of Directors with, or whose election to such
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Board of Directors was approved by, the affirmative vote of a majority of the
Continuing Directors who were members of such Board of Directors at the time of
such nomination or election.
"Default" means any event that is or with the passage of time or the giving
of notice or both would be an Event of Default.
"Disqualified Stock" means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of the Holder thereof, in whole or in part, on or prior to the
date that is 91 days after the date on which the notes mature.
"Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Existing Indebtedness" means Indebtedness of Metal Management and its
Restricted Subsidiaries (other than Indebtedness under the Senior Credit
Facility) in existence on the date of the indenture, until such amounts are
repaid.
"Fair Market Value" means, with respect to any asset or property, the price
which could be negotiated in an arm's-length, free market transaction, in cash,
between an informed and willing seller and an informed and willing and able
buyer, neither of whom is under undue pressure or compulsion to complete the
transaction. Fair Market Value shall be determined by the Board of Directors of
Metal Management acting reasonably and in good faith and, in the case of Fair
Market Value that exceeds $5.0 million, shall be evidenced by a Board Resolution
delivered to the trustee; provided, however, that, in the case of any
determination of Fair Market Value for purposes of the covenant described under
the caption "--Certain Covenants--Restricted Payments," if the aggregate Fair
Market Value could be reasonably likely to exceed $10.0 million, the Fair Market
Value shall be determined by an accounting, appraisal or investment banking firm
of nationally recognized standing that is, in the reasonable and good faith
judgment of the Board of Directors of Metal Management, qualified to perform the
task for which such firm has been engaged.
"Fixed Charges" means, with respect to any Person for any period, the sum
of:
(1) the consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued
(including, without limitation, amortization of original issue discount,
non-cash interest payments, the interest component of any deferred payment
obligations, the interest component of all payments associated with Capital
Lease Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect of
letter of credit or bankers' acceptance financings, and net payments (if
any) pursuant to Hedging Obligations, but excluding amortization of
deferred financing costs), and
(2) the consolidated interest expense of such Person and its
Restricted Subsidiaries that was capitalized during such period, and
(3) any interest expense on Indebtedness of another Person that is
Guaranteed by such Person or one of its Restricted Subsidiaries or secured
by a Lien on assets of such Person or one of its Restricted Subsidiaries
(whether or not such Guarantee or Lien is called upon), and
(4) all cash dividend payments (and non-cash dividend payments in the
case of a Person that is a Restricted Subsidiary) on any series of
Preferred Stock of such Person, in each case, on a consolidated basis and
in accordance with GAAP.
"Fixed Charge Coverage Ratio" means, with respect to any Person for any
period, the ratio of the Consolidated Cash Flow of such Person for such period
to the Fixed Charges of such Person for such period. In the event that Metal
Management or any of its Restricted Subsidiaries incurs, assumes, Guarantees or
redeems any indebtedness (other than revolving credit borrowings) or issues
Preferred Stock subsequent to the commencement of the period for which the Fixed
Charge Coverage Ratio is being
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calculated but prior to the date on which the event for which the calculation of
the Fixed Charge Coverage Ratio is made (the "Calculation Date"), then the Fixed
Charge Coverage Ratio shall be calculated giving pro forma effect to such
incurrence, assumption, Guarantee or redemption of Indebtedness, or such
issuance or redemption of Preferred Stock, as if the same had occurred at the
beginning of the applicable four-quarter reference period. In addition, for
purposes of making the computation referred to above, (1) acquisitions that have
been consummated by Metal Management or any of its Restricted Subsidiaries,
including through mergers or consolidations and including any related financing
transactions, during the four-quarter reference period or subsequent to such
reference period and on or prior to the Calculation Date shall be deemed to have
occurred on the first day of the four-quarter reference period and Consolidated
Cash Flow and Fixed Charges for such reference period shall be calculated giving
pro forma effect (excluding any pro forma increase in revenues other than
historical revenue of the acquired business, but including any pro forma expense
and cost reductions, in each case calculated on a basis consistent with
Regulation S-X under the Securities Act of 1933) to such acquisition and related
financing transactions and (2) the Consolidated Cash Flow attributable to
discontinued operations, as determined in accordance with GAAP, and operations
or businesses disposed of prior to the Calculation Date, calculated giving pro
forma effect to such disposition, shall be excluded, and (3) the Fixed Charges
attributable to discontinued operations, as determined in accordance with GAAP,
and operations or businesses disposed of prior to the Calculation Date, shall be
excluded, but only to the extent that the obligations giving rise to such Fixed
Charges will not be obligations of the referent Person or any of its Restricted
Subsidiaries following the Calculation Date.
"Foreign Subsidiaries" means any Subsidiary of Metal Management
incorporated or organized under the laws of a jurisdiction outside of the United
States of America and which, individually or together with all other such
Subsidiaries outside of the United States of America, represents less than 10%
of the assets or revenues of Metal Management and its Restricted Subsidiaries
for any period, on a consolidated basis and determined in accordance with GAAP.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the date of the indenture.
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.
"Hedging Obligations" means, with respect to any Person, the net
obligations of such Person under (1) currency exchange or interest rate swap
agreements, currency exchange or interest rate cap agreements and currency
exchange or interest rate collar agreements and (2) other agreements or
arrangements designed to protect such Person against fluctuations in currency
exchange or interest rates or commodity prices.
"Holder" means a holder of any of the notes.
"Indebtedness" means, with respect to any Person, any indebtedness of such
Person, whether or not contingent, in respect of borrowed money or evidenced by
bonds, notes, debentures or similar instruments or letters of credit (or
reimbursement agreements in respect thereof) or banker's acceptances or
representing Capital Lease Obligations or the maximum fixed redemption or
repurchase price of Redeemable Interests of such Person at the time of
determination or the balance deferred and unpaid of the purchase price of any
property (other than contingent or "earnout" payment obligations) or
representing any net Hedging Obligations, except any such balance that
constitutes an accrued expense or trade payable, if and to the extent any of the
foregoing indebtedness (other than letters of credit and Hedging Obligations)
would appear as a liability upon a balance sheet of such Person prepared in
accordance with GAAP as well as all indebtedness of others secured by a Lien on
any asset of such
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Person (whether or not such indebtedness is assumed by such Person) and, to the
extent not otherwise included, the Guarantee by such Person of any indebtedness
of any other Person.
"Investments" means, with respect to any Person, all investments by such
Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including Guarantees of Indebtedness or other obligations),
advances or capital contributions (excluding commission, travel and similar
advances to officers and employees made in the ordinary course of business),
purchases or other acquisitions for consideration of Indebtedness, Equity
Interests or other securities, together with all items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP.
If Metal Management or any Subsidiary of Metal Management sells or otherwise
disposes of any Equity Interests of any direct or indirect Restricted Subsidiary
of Metal Management such that, after giving effect to any such sale or
disposition, such Person is no longer a Subsidiary of Metal Management, Metal
Management shall be deemed to have made an Investment on the date of any such
sale or disposition equal to the Fair Market Value of the Equity Interests of
such Subsidiary not sold or disposed of. The amount of any Investment shall be
the original cost of such investment plus the cost of all additions thereto,
without any adjustments for increases or decreases in value, or write-ups,
write-downs or write-offs with respect to such Investment.
"Lien" means, with respect to any asset or property, any mortgage, deed of
trust, lien (statutory or other), pledge, charge, security interest, lease,
easement, restriction, covenant or encumbrance of any kind or nature in respect
of such asset or property, whether or not filed, recorded or otherwise perfected
under applicable law (including any conditional sale or other title retention
agreement, any lease in the nature thereof, any option or other agreement to
sell or give a security interest under the Uniform Commercial Code (or
equivalent statutes) of any relevant jurisdiction).
"Loan Reductions" means permanent commitment reductions with respect to
revolving loans under the Senior Credit Facility (or any Permitted Refinancing
Indebtedness relating thereto) that have been made since the date of the
indenture.
"Mortgage" means each mortgage instrument (or deed of trust) and assignment
of leases and rents substantially in the form of those delivered pursuant to the
provisions of the Senior Credit Facility with such modifications as shall be
appropriate (1) to conform to applicable local laws or customs regarding Real
Property in the jurisdiction where such instrument is to be recorded and (2) to
grant to the trustee the Security Interest in the Real Property encumbered by
such instrument contemplated by and consistent with the provisions of the
indenture and the Security Document, as the same may be amended, supplemented or
otherwise modified in accordance with the provisions hereof and thereof.
"Net Income" means, with respect to any Person, the net income (loss) of
such Person, determined in accordance with GAAP and before any reduction in
respect of Preferred Stock dividends, excluding, however, (1) any gain (but not
loss), together with any related provision for taxes on such gain (but not
loss), realized in connection with (a) any Asset Sale (including, without
limitation, dispositions pursuant to sale and leaseback transactions) or (b) the
disposition of any securities by such Person or any of its Restricted
Subsidiaries or the extinguishment of any Indebtedness of such Person or any of
its Restricted Subsidiaries and (2) any extraordinary or nonrecurring gain (but
not loss), together with any related provision for taxes on such extraordinary
or nonrecurring gain (but not loss).
"Net Proceeds" means the aggregate cash proceeds received by Metal
Management or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of:
(1) the direct costs relating to such Asset Sale (including, without
limitation, legal, accounting and investment banking fees, and brokerage
and sales commissions) and any relocation expenses incurred as a result
thereof,
(2) taxes paid or payable as a result thereof (after taking into
account any available tax credits or deductions and any tax sharing
arrangements), and
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(3) any reserve for adjustment in respect of the sale price of such
asset or assets established in accordance with GAAP.
"Non-Recourse Debt" means Indebtedness:
(1) as to which neither Metal Management nor any of its Restricted
Subsidiaries
(a) provides credit support of any kind (including any undertaking,
agreement or instrument that would constitute Indebtedness),
(b) is directly or indirectly liable (as a guarantor or otherwise),
or
(c) constitutes the lender; and
(2) no default with respect to which (including any rights that the
holders thereof may have to take enforcement action against an Unrestricted
Subsidiary) would permit (upon notice, lapse of time or both) any holder of
any other Indebtedness of Metal Management or any of its Restricted
Subsidiaries to declare a default on such other Indebtedness or cause the
payment thereof to be accelerated or payable prior to its stated maturity;
and
(3) as to which the lenders have been notified in writing that they
will not have any recourse to the stock or assets of Metal Management or
any of its Restricted Subsidiaries.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Officer's Certificate" means a certificate signed on behalf of Metal
Management by the principal executive officer, the principal financial officer,
the treasurer or the principal accounting officer of Metal Management that meets
the requirements set forth in the indenture.
"Pari Passu Indebtedness" means Indebtedness that ranks pari passu in right
of payment to the notes.
"Permitted Investments" means:
(1) any Investment in Metal Management or in a Restricted Subsidiary
of Metal Management;
(2) any Investment in cash and Cash Equivalents;
(3) any Investment by Metal Management or any Restricted Subsidiary of
Metal Management in a Person, if as a result of such Investment:
(a) such Person becomes a Restricted Subsidiary of Metal
Management, or
(b) such Person, in one transaction or a series of related
transactions, is merged, consolidated or amalgamated with or into, or
transfers or conveys substantially all of its assets to, or is
liquidated into, Metal Management or a Restricted Subsidiary of Metal
Management;
(4) any Restricted Investment made as a result of the receipt of
consideration not constituting cash or Cash Equivalents from an Asset Sale
that was made pursuant to and in compliance with the covenant described
above under the caption "--Repurchase at the Option of Holders--Asset
Sales";
(5) any Investment existing on the date of the indenture, and any
renewals or replacements thereof;
(6) any Investment by Restricted Subsidiaries in other Restricted
Subsidiaries and Investments by Subsidiaries that are not Restricted
Subsidiaries in other Subsidiaries that are not Restricted Subsidiaries;
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(7) any Investment acquired or made by Metal Management or any of its
Restricted Subsidiaries:
(a) in exchange for any other Investment or receivable held by
Metal Management or any such Restricted Subsidiary in connection with or
as a result of a bankruptcy, workout, reorganization or recapitalization
of the issuer of such other Investment or receivable, or
(b) as a result of a foreclosure by Metal Management or any of its
Restricted Subsidiaries with respect to any secured Investment or other
transfer of title with respect to any secured Investment in default;
(8) Hedging Obligations;
(9) any acquisition of assets, Equity Interests or other securities by
Metal Management for consideration consisting of common Equity Interests of
Metal Management;
(10) loans and advances to officers, directors and employees for
business related travel expenses, moving expenses and other similar
expenses, in each case, incurred in the ordinary course of business;
(11) Investments the payment for which consists exclusively of Equity
Interests (exclusive of Disqualified Stock) of Metal Management;
(12) repurchases of notes by Metal Management or any Restricted
Subsidiary in open market purchase transactions;
(13) Investments not to exceed $15.0 million in the aggregate
outstanding at any time in Unrestricted Subsidiaries or Permitted Joint
Ventures;
(14) any Investment by Metal Management or any Restricted Subsidiary
in any of its suppliers in the form of "take or pay" or "requirements"
contracts entered into by Metal Management or such Restricted Subsidiary in
the ordinary course of business; and
(15) the making of other Investments not to exceed $15.0 million in
the aggregate outstanding at any time.
"Permitted Joint Venture" means, with respect to any Person, any
corporation, partnership, limited liability company or other business entity of
which at least 25% of the total voting power of shares of Capital Stock entitled
(without regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by such Person or one or more of the other Subsidiaries
of that Person (or a combination thereof).
"Permitted Liens" means:
(1) with respect to Collateral other than Real Property, "Permitted
Liens" as defined in the Security Agreement, and
(2) with respect to Real Property required to be pledged as Collateral
in accordance with the provisions of the covenant under the heading
"--Certain Covenants--Limitation on Incurrence of Pari Passu Indebtedness,"
(a) "Permitted Liens" as defined in, and solely to the extent and
for so long as permitted with respect to such Real Property by, the
Senior Credit Facility and the security documents securing the Senior
Bank Debt (in each case, as in effect from time to time in accordance
with the provisions thereof) and, at such time as the Senior Credit
Facility shall no longer be in effect and the Obligations thereunder
shall have been paid in full (whether pursuant to its terms or
otherwise), as the same shall have been in effect on the date
immediately preceding the date on which the Senior Credit Facility shall
have been so terminated),
(b) the Security Interests created pursuant to the Security
Documents, and
(c) Prior Liens of the type described in clause (2) of the
definition of "Prior Liens."
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"Permitted Refinancing Indebtedness" means any Indebtedness of Metal
Management or any of its Restricted Subsidiaries issued in exchange for, or the
net proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of Metal Management or any of its Restricted
Subsidiaries; provided that:
(1) the principal amount (or accreted value, if applicable) of such
Permitted Refinancing Indebtedness does not exceed the principal amount (or
accreted value, if applicable) of the Indebtedness so extended, refinanced,
renewed, replaced, defeased or refunded (plus the amount of any premium
required to be paid in connection therewith and plus reasonable expenses
incurred in connection therewith);
(2) such Permitted Refinancing Indebtedness has a final maturity date
no earlier than the final maturity date of, and has a Weighted Average Life
to Maturity equal to or greater than the Weighted Average Life to Maturity
of, the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded;
(3) if the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded is subordinated in right of payment to the notes, such
Permitted Refinancing Indebtedness has a final maturity date no earlier
than the final maturity date of, and is subordinated in right of payment
to, the notes on terms at least as favorable to the Holders of notes as
those contained in the documentation governing the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; and
(4) such Indebtedness is incurred either by Metal Management or by the
Restricted Subsidiary who is the obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof or any
other entity.
"Preferred Stock," as to any Person, means any Equity Interest with
preferential right of payment of dividends or upon liquidation, dissolution or
winding up over Equity Interests of any other class of such Person.
"Principal Business" means any business in the metals industry, and
businesses reasonably related thereto.
"Principals" mean, collectively, (1) Samstock, L.L.C. and its affiliates
and successors and (2) T. Benjamin Jennings, Albert A. Cozzi, Frank J. Cozzi and
Gregory P. Cozzi, and the respective spouses, parents and lineal descendants (by
blood, adoption or marriage) of the foregoing, trusts the sole beneficiaries of
which (other than contingent beneficiaries) are any of the foregoing, or
corporations, partnerships or limited liability companies the sole shareholders,
sole partners or sole members of which are any of the foregoing.
"Prior Liens" means:
(1) with respect to Collateral other than Real Property, "Prior Liens"
as defined in the Security Agreement, and
(2) with respect to Real Property required to be pledged as Collateral
in accordance with the provisions of "--Certain Covenants--Limitation on
Incurrence of Pari Passu Indebtedness,"
(a) "Permitted Liens" (as defined in, and solely to the extent and
for so long as permitted with respect to such Real Property by, the
Senior Credit Facility and the security documents securing the Senior
Bank Debt) to the extent and in the manner such Liens are in effect on
the date of execution and delivery of the applicable Security Document
excluding, however, the Liens, if any, granted to the holders of any
Specified Pari Passu Indebtedness, and
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(b) Senior Permitted Liens (as defined in the Security Agreement)
incurred or created subsequent to the date of execution and delivery of
the applicable Security Documents (with respect to the Mortgage Lien)
solely to the extent and for so long as permitted with respect to the
Real Property Collateral to be senior and superior to the Lien granted
to the senior bank agent pursuant to the provisions of the Senior Credit
Facility and the security documents securing the Senior Bank Debt.
"Pro Forma Basis" means, with respect to any additional Indebtedness
incurred or Disqualified Stock issued, as the case may be, the Fixed Charge
Coverage Ratio for Metal Management for the most recently ended four full fiscal
quarters for which internal financial statements are available immediately
preceding the date of such occurrence, as adjusted to reflect the incurrence of
such additional Indebtedness or the issuance of such Disqualified Stock, as the
case may be, and the application of the net proceeds therefrom, as of the
beginning of such four-quarter period.
"Purchase Money Indebtedness" means Indebtedness the net proceeds of which
are used for the purchase of property or assets acquired in the ordinary course
of business by the Person incurring such Indebtedness.
"Real Property" means any interest in any real property or any portion
thereof whether owned in fee or leased or otherwise owned.
"Redeemable Interest" of any Person means any equity security of or other
ownership interest in such Person that by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable) or
otherwise (including upon the occurrence of an event) matures or is required to
be redeemed (pursuant to any sinking fund obligation or otherwise) or is
convertible into or exchangeable for Indebtedness or is redeemable at the option
of the holder thereof, in whole or in part, at any time prior to the final
stated maturity of the notes.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of such Person
that is not (1) an Unrestricted Subsidiary or (2) a direct or indirect
Subsidiary of an Unrestricted Subsidiary; provided, however, that upon the
occurrence of any Unrestricted Subsidiary ceasing to be an Unrestricted
Subsidiary, such Subsidiary shall be included in the definition of Restricted
Subsidiary.
"Security Agreement" means each security agreement that may be executed in
accordance with the indenture and the Security Documents.
"Security Documents" means, collectively, the intercreditor agreement, the
Security Agreement and all other security interests, mortgages, deeds of trust,
pledges, Collateral assignments or other instruments evidencing or creating any
Security Interests in favor of the trustee in all or any portion of the
Collateral, in each case, as amended, amended and restated, supplemented or
otherwise modified from time to time, in accordance with the terms thereof.
"Security Interests" means the Liens on the Collateral created by the
Security Documents in favor of the trustee for its benefit and the benefit of
the Holders of the notes.
"Senior Bank Debt" means all Obligations under or in respect of the Senior
Credit Facility, together with any refunding, refinancing or replacement, in
whole or part, of such Indebtedness.
"Senior Credit Facility" means that certain credit facility dated as of
March 31, 1998, by and among Metal Management, certain Subsidiaries of Metal
Management, BT Commercial Corporation, as agent for the lenders, and certain
commercial lending institutions party thereto, including any related notes,
guarantees, collateral or security documents, instruments and agreements
executed in connection therewith, and in each case as amended (including any
amendment and restatement thereof), modified, renewed, refunded, replaced or
refinanced from time to time, including any agreement extending the maturity of,
refinancing, replacing or otherwise restructuring (including increasing the
amount of available borrowings thereunder (provided that such increase in
borrowings is permitted by the covenant described under the
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caption "--Certain Covenants--Incurrence of Indebtedness and Issuance of
Disqualified Stock") or adding Subsidiaries of Metal Management as additional
borrowers or guarantors thereunder) all or any portion of the Indebtedness under
such agreement or any successor or replacement agreement and whether by the same
or any other agent, lender or group of lenders.
"Senior Subordinated Notes" means the $180.0 million aggregate principal
amount of 10% Senior Subordinated Notes due 2008 of Metal Management issued
pursuant to an indenture dated May 13, 1998.
"Significant Subsidiary" means any Restricted Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act of 1933, as such Regulation is in
effect on the date hereof.
"Significant Subsidiary Guarantee" means the Subsidiary Guarantee of a
Significant Subsidiary.
"Significant Subsidiary Guarantor" means a Significant Subsidiary that is a
Subsidiary Guarantor.
"Specified Pari Passu Indebtedness" means Pari Passu Indebtedness of Metal
Management or any Restricted Subsidiary that (1) is incurred after the date of
the indenture and (2) is of a type such that Metal Management or any Restricted
Subsidiary must have, on or prior to the date of such incurrence, granted
Security Interests in and valid mortgage Liens upon all Real Property of Metal
Management and the Restricted Subsidiaries that secures the Senior Bank Debt in
order for the incurrence thereof to be in compliance with the covenant described
under "--Certain Covenants--Limitation on Incurrence of Pari Passu
Indebtedness."
"Subordinated Indebtedness" means any Indebtedness of Metal Management or
any of its Restricted Subsidiaries which is expressly by its terms subordinated
in right of payment to any other Indebtedness.
"Subsidiary" means, with respect to any Person, (1) any corporation,
limited liability company, association or other business entity of which more
than 50% of the total voting power of shares of Capital Stock entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly by such Person or one or more of the other Subsidiaries
of that Person (or a combination thereof) and (2) any partnership (a) the sole
general partner or the managing general partner of which is such Person or a
Subsidiary of such Person or (b) the only general partners of which are such
Person or one or more Subsidiaries of such Person (or any combination thereof).
"Subsidiary Guarantor" means, each of the Subsidiaries of Metal Management
on the issue date of the notes and each Subsidiary of Metal Management that is
required to Guarantee the notes pursuant to the provisions of "--Certain
Covenants--Additional Subsidiary Guarantees."
"Unrestricted Subsidiary" means any Subsidiary that is designated by the
Board of Directors as an Unrestricted Subsidiary pursuant to a Board Resolution,
which designation may only be made if such Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement or
understanding with Metal Management or any Restricted Subsidiary of Metal
Management unless the terms of any such agreement, contract, arrangement or
understanding are no less favorable to Metal Management or such Restricted
Subsidiary than those that might be obtained at the time from Persons who
are not Affiliates of Metal Management;
(3) is a Person with respect to which neither Metal Management nor any
of its Restricted Subsidiaries has any direct or indirect obligation:
(a) to subscribe for additional Equity Interests, or
(b) to maintain or preserve such Person's financial condition or to
cause such Person to achieve any specified levels of operating results;
and
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(4) has not guaranteed or otherwise directly or indirectly provided
credit support for any Indebtedness of Metal Management or any of its
Restricted Subsidiaries.
Any such designation by the Board of Directors shall be evidenced to the
trustee by filing with the trustee a certified copy of the Board Resolution
giving effect to such designation and an Officer's Certificate certifying that
such designation complied with the foregoing conditions and was permitted by the
covenant described above under the caption "--Certain Covenants--Restricted
Payments." If, at any time, any Unrestricted Subsidiary would fail to meet the
foregoing requirements as an Unrestricted Subsidiary, it shall thereafter cease
to be an Unrestricted Subsidiary for purposes of the indenture and any
Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted
Subsidiary of Metal Management as of such date (and, if such Indebtedness is not
permitted to be incurred as of such date under the covenant described above
under the caption "--Certain Covenants--Incurrence of Indebtedness and Issuance
of Disqualified Stock," Metal Management shall be in violation of such
covenant). The Board of Directors of Metal Management may at any time designate
any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such
designation shall be deemed to be an incurrence of Indebtedness by a Restricted
Subsidiary of Metal Management of any outstanding Indebtedness of such
Unrestricted Subsidiary and such designation shall only be permitted if (1) such
Indebtedness is permitted to be incurred by the covenant described above under
the caption "--Certain Covenants--Incurrence of Indebtedness and Issuance of
Disqualified Stock," and (2) no Default or Event of Default would be in
existence following such designation.
"Voting Stock" means, with respect to any Person, any class or series of
capital stock of such Person that is ordinarily entitled to vote in the election
of directors thereof at a meeting of stockholders called for such purpose,
without the occurrence of any additional event or contingency.
"Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying:
(a) the amount of each then remaining installment, sinking fund,
serial maturity or other required payments of principal, including
payment at final maturity, in respect thereof, by
(b) the number of years (calculated to the nearest one-twelfth)
that will elapse between such date and the making of such payment, by
(2) the then outstanding principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" is any Wholly Owned Subsidiary that is
a Restricted Subsidiary.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of such Person
all of the outstanding Capital Stock or other ownership interests of which
(other than directors' qualifying shares) shall at the time be owned by such
Person or by one or more Wholly Owned Subsidiaries of such Person and one or
more Wholly Owned Subsidiaries of such Person.
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CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following discussion summarizes the material United States federal
income tax considerations relevant to the purchase, ownership and disposition of
the new notes by the beneficial owners thereof ("Holders"). The discussion is
limited to Holders of new notes exchanged for old notes of which such Holders
were the initial Holders and does not address the tax consequences to subsequent
purchasers of new notes. This summary does not purport to be a complete analysis
of all the potential federal income and estate tax effects relating to the
purchase, ownership and disposition of the new notes. There can be no assurance
that the Internal Revenue Service (the "Service") will take a similar view of
such consequences. Further, the discussion does not address all aspects of
taxation that might be relevant to particular Holders in fight of their
individual circumstances (including the effect of any state, local, non-United
States or other tax laws) or to certain types of Holders (including dealers in
securities, insurance companies, financial institutions and tax-exempt entities)
subject to special treatment under United States federal tax law. The discussion
below assumes that the new notes are held as capital assets.
The discussion of the United States federal income tax consequences set
forth below is based upon provisions of the Internal Revenue Code of 1986, as
amended (the "Code"), regulations thereunder, judicial decisions, and
administrative interpretations, all in effect as of the date hereof, all of
which are subject to change at any time, and any such change may be applied
retroactively. Because individual circumstances may differ, each prospective
purchaser of the new notes is strongly urged to consult its own tax advisor with
respect to its particular tax situation and the particular tax effects of any
state, local, non-United States, or other tax laws and possible changes in the
tax laws.
As used herein, the term "United States Holder" means a Holder of a new
note who or which is for United States federal income tax purposes either (i) a
citizen or resident of the United States, (ii) a corporation, partnership or
other entity created or organized in the United States or organized under the
laws of the United States or of any State thereof (including the District of
Columbia), (iii) an estate the income of which is subject to United States
federal income taxation regardless of its source, or (iv) a trust described in
Section 7701 (a) (30) of the Code (taking into account changes thereto and
associated effective dates, elections and transition rules). The term "United
States Holder" also includes certain former citizens or residents of the United
States whose income and gain on the new notes will be subject to United States
taxation. As used herein, the term "Non-United States Holder" means a Holder of
a new note who or which is not a United States Holder.
TAX CONSEQUENCES TO UNITED STATES HOLDERS
Consequences of the Exchange Offer to Exchanging and Nonexchanging Holders
The exchange of an old note for a new note pursuant to the exchange offer
will not be taxable to an exchanging Holder for federal income tax purposes. As
a result (i) an exchanging Holder will not recognize any gain or loss on the
exchange; (ii) the holding period for the new note will include the holding
period for the old note; (iii) the basis of the new note will be the same as the
basis for the old note; and (iv) any original issue discount ("OID") on the new
note will be the same as on the old note.
The exchange offer will result in no federal income tax consequences to a
nonexchanging holder of old notes.
The treatment of interest described below with respect to the new notes is
based in part upon our determination that, as of the date of issuance of the old
notes, the possibility that additional interest would be paid to Holders
pursuant to a Registration Default was remote, in which case the possibility of
such payment should not, as of the issue date, have caused the old notes to be
treated as having been issued with contingent interest under certain United
States Treasury Regulations (the "Contingent Interest Regulations") and,
therefore, the new notes should not be subject to the Contingent Interest
Regulations. The Service may take a different position, which could affect the
timing and character of interest income reported by United States Holders. Our
determination that the possibility of such additional payments was
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remote for these purposes is binding on a United States Holder, unless such
Holder discloses in the proper manner to the Service that it is taking a
different position.
Payments of Stated Interest
Interest paid on a new note will generally be taxable to a United States
Holder as ordinary interest income at the time it accrues or is received in
accordance with the United States Holder's method of accounting for United
States federal income tax purposes.
Original Issue Discount
An old note was issued with OID equal to the excess of the old note's
"stated redemption price at maturity" over its "issue price," Generally, the
issue price of an old note was the first price at which a substantial amount of
old notes was sold to other than bond houses, brokers, or similar persons or
organizations acting in the capacity of underwriters, placement agents, or
wholesalers. The stated redemption price at maturity of an old note is the total
of all payments provided by the old note that are not payments of "qualified
states interest." A qualified stated interest payment is generally any one of a
series of stated interest payments on a note that are unconditionally payable at
least annually at a single fixed rate (with certain exceptions for lower rates
paid during some periods) applied to the outstanding principal amount of the
note. The OID treatment of an old note will continue and be the same with
respect to the new note for which it is exchanged.
United States Holders of notes must generally include OID in income
calculated on a constant-yield method before the receipt of cash attributable to
such income, and generally will have to include in income increasingly greater
amounts of OID over the life of the note. The amount of OID includible in income
by a United States Holder of a note is the sum of the daily portions of OID with
respect to the note for each day during the taxable year or portion of the
taxable year on which the United States Holder holds such note ("accrued OID").
The daily portion is determined by allocating to each day in any "accrual
period" a pro rata portion of the OID allocable to that accrual period. Accrual
periods with respect to a note may be of any length and may vary in length over
the term of the note as long as (a) no accrual period is longer than one year
and (b) each scheduled payment of interest or principal on the notes occur on
either the final or first day of an accrual period. The amount of OID allocable
to an accrual period equals the excess of (a) the product of the note's adjusted
issue price at the beginning of the accrual period and such note's yield to
maturity (determined on the basis of compounding at the close of each accrual
period and properly adjusted for the length of the accrual period) over (b) the
sum of the payments of qualified stated interest on the note allocable to the
accrual period. The "adjusted issue price" of a note at the beginning of any
accrual period is the issue price of the note increased by (x) the amount of
accrued OID for each prior accrual period and decreased by (y) the amount of any
payments previously made on the note that were not qualified stated interest
payments. For purposes of determining the amount of OID allocable to an accrual
period, if an interval between payments of qualified stated interest on the note
contains more than one accrual period, the amount of qualified stated interest
payable at the end of the interval (including any qualified stated interest that
is payable on the first day of the accrual period immediately following the
interval) is allocated pro rata on the basis of the relative length of each
accrual period in the interval, and the adjusted issue price at the beginning of
each accrual period in the interval must be increased by the amount of any
qualified stated interest that has accrued prior to the first day of the accrual
period but that is not payable until the end of the interval. The amount of OID
allocable to an initial short accrual period may be computed using any
reasonable method if all other accrual periods other than a final short accrual
period are of equal length. The amount of OID allocable to the final accrual
period is the difference between (x) the amount payable at the maturity of the
note (other than any payment of qualified stated interest) and (y) the note's
adjusted issue price as of the beginning of the final accrual period.
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Sale, Exchange, Redemption or Retirement of Notes
Upon the sale, exchange, redemption or retirement of a new note, a United
States Holder will recognize taxable gain or loss equal to the difference
between the amount realized on the sale, exchange, redemption or retirement (not
including any amount attributable to accrued but unpaid interest) and such
Holder's adjusted tax basis in the new note. To the extent attributable to
accrued but unpaid interest, the amount recognized by the United States Holder
will be treated as a payment of interest. See "--Tax Consequences to United
States Holders--Payments of Interest". A United States Holder's adjusted tax
basis in a new note will equal the adjusted basis of the old note to such Holder
at the time of the exchange, as subsequently adjusted, all in accordance with
the rules for determining adjusted basis set forth above under "Original Issue
Discount."
Gain or loss recognized on the sale, exchange, redemption or retirement of
a note by a United States Holder generally will be capital gain or loss. Capital
gain realized by a non-corporate taxpayer on the disposition of a capital asset
(including a new note) held for more than one year is taxed at a maximum rate of
20%. Capital gain on the disposition of an asset (including a new note) by
non-corporate taxpayers held for one year or less continues to be taxed at the
rates applicable to ordinary income (i.e., up to 39.6%). The distinction between
capital gain or loss and ordinary income or loss is also relevant for purposes
of, among other things, limitations on the deductibility of capital losses.
TAX CONSEQUENCES TO NON-UNITED STATES HOLDERS
Under present United States federal income and estate tax law, and subject
to the discussion below concerning backup withholding:
(a) payments of principal, interest and OID on the new notes by us or
any paying agent to a Non-United States Holder, as defined above, will not
be subject to withholding of United States federal income tax, provided
that, in the case of interest and OID, (i) such Non-United States Holder
does not own, actually or constructively, 10 percent or more of the total
combined voting power of all classes of our stock entitled to vote, (ii)
such Non-United States Holder is not, for United States federal income tax
purposes, a controlled foreign corporation related, directly or indirectly,
to us through stock ownership, (iii) such Non-United States Holder is not a
bank receiving interest or OID described in Section 881 (c) (3) (A) of the
Code and (iv) the certification requirements under Section 871 (h) or
Section 881 (c) of the Code and Treasury regulations thereunder (summarized
below) are met;
(b) a Non-United States Holder will not be subject to United States
federal income tax on gain recognized on the sale, exchange or other
disposition of a new note, unless (i) such Non-United States Holder is a
non-resident alien individual who is present in the United States for 183
days or more in the taxable year of sale, exchange or other disposition,
and certain other conditions are met or (ii) such gain is effectively
connected with the conduct by such Holder of a trade or business in the
United States; and
(c) a new note held by an individual who is not a citizen or resident
of the United States (as defined for United States federal estate tax
purposes) at the time of his death will not be subject to United States
federal estate tax as a result of such individual's death, provided that,
at the time of such individual's death, (i) the individual does not own,
actually or constructively, 10 percent or more of the total combined voting
power of all classes of our stock entitled to vote and (ii) payments with
respect to such new note, if received (or accrued in the case of OID) at
the time of the individual's death, would not have been effectively
connected to the conduct by such individual of a trade or business in the
United States.
Certification Requirements
Sections 871 (h) and 881 (c) of the Code and Treasury Regulations relating
thereto require that, in order to obtain the exemption from withholding tax
described in paragraph (a) above, either (i) the
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<PAGE> 87
beneficial owner of a new note must certify, under penalties of perjury, to us
or the paying agent, as the case may be, that such owner is a Non-United States
Holder and must provide such owner's name and address or (ii) a securities
clearing organization, bank or other financial institution that holds customers
securities in the ordinary course of its trade or business (a "Financial
Institution") and holds the new note on behalf of the beneficial owners thereof
must certify, under penalties of perjury, to us or the paying agent, as the case
may be, that such certificate has been received from the beneficial owner by it
or by a Financial Institution between it and the beneficial owner and must
furnish the payor with a copy thereof. A certificate described in this paragraph
is effective only with respect to payments of interest made to the certifying
Non-United States Holder after issuance of the certificate in the calendar year
of its issuance and the two immediately succeeding calendar years. Such
requirement will be fulfilled if the beneficial owner of a new note certifies on
Internal Revenue Service Form W-8, under penalties of perjury, that it is a
Non-United States Holder and provides its name and address, and if any Financial
Institution holding the new note on behalf of the beneficial owner files a
statement with the withholding agent to the effect that it has received such a
statement from the beneficial owner (and furnishes the withholding agent with a
copy thereof).
The United States Treasury Department adopted new Regulations published in
the Federal Register on October 14, 1997 (the "New Regulations") which affect
the United States taxation of Non-United States Holders with respect to
withholding and backup withholding. As promulgated, the New Regulations are
generally effective, subject to certain transition rules described below, for
payments after December 31, 1999, regardless of the issue date of the instrument
with respect to which such payments are made. The Service recently announced its
intention to amend the New Regulations to extend the effective date to those
payments made after December 31, 2000, subject to certain transition rules. The
discussion under this heading and under "Information Reporting and Backup
Withholding" below, is not intended to be a complete discussion of the
provisions of the New Regulations or the recent Service announcement, and
Holders of the new notes are urged to consult their tax advisors concerning the
tax consequences of their acquiring, holding and disposing of the new notes in
light of the New Regulations.
The New Regulations provide documentation procedures designed to simplify
compliance by withholding agents. The New Regulations generally do not affect
the documentation miles described above, but add other certification options.
Under one such option, a withholding agent will be allowed to rely on an
intermediary withholding certificate furnished by a "qualified intermediary" (as
defined below) on behalf of one or more beneficial owners (or other
intermediaries) without the withholding agent having to obtain the beneficial
owner certificate described above. "Qualified intermediaries" include: (i)
foreign financial institutions or foreign clearing organizations (other than a
United States branch or United States office of such institution or
organization) or (ii) foreign branches or offices of United States financial
institutions or foreign branches or offices of United States clearing
organizations, which, as to both (i) and (ii), have entered into withholding
agreements with the Service. In addition to certain other requirements,
qualified intermediaries must obtain withholding certificates, such as revised
Internal Revenue Service Form W-8 (see below), from each beneficial owner. Under
another option, an authorized foreign agent of a United States withholding agent
will be permitted to act on behalf of the United States withholding agent,
provided certain conditions are met.
For purposes of the certification requirements, the New Regulations
generally treat as the beneficial owners of payments on a new note those persons
that, under United States tax principles, are the taxpayers with respect to such
payments, rather than persons such as nominees or agents legally entitled to
such payments. In the case of payments to an entity classified as a foreign
partnership under United States tax principles, the partners, rather than the
partnership, generally will be required to provide the required certifications
to qualify for the withholding exemption described above. A payment to a United
States partnership, however, is treated for these purposes as payment to a
United States payee, even if the partnership has one or more foreign partners.
The New Regulations provide certain presumptions with respect to withholding for
Holders not furnishing the required certifications to qualify for the
withholding exemption described above. In addition, the New Regulations will
replace a number of current tax certification forms (including Internal Revenue
Service Form W-8, Form 1001 (treaty exemptions) and
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<PAGE> 88
possibly Form 4224 (discussed below) with a single, revised Internal Revenue
Service Form W-8 (which, in certain circumstances, will require information in
addition to that previously required). Under the New Regulations, this Internal
Revenue Service Form W-8 will remain valid until the last day of the third
calendar year following the year in which the certificate is signed. The New
Regulations contain detailed rules, which might be changed in light of the
recent announcement by the Service that the effective date will be postponed,
governing tax certifications during the transition period prior to and
immediately following the effectiveness of the New Regulations.
United States Trade or Business
If a Non-United States Holder is engaged in a trade or business in the
United States, and if interest or OID on the new note, or gain recognized on the
sale, exchange or other disposition of the new note, is effectively connected
with the conduct of such trade or business, the Non-United States Holder,
although exempt from withholding of United States income tax, will generally be
subject to United States income tax on such interest, OID or gain in the same
manner as if it were a United States Holder. See "--Tax Consequences to United
States Holders". In lieu of the certificates described above, such a Non-United
States Holder will be required to provide the withholding agent a properly
executed Internal Revenue Service Form 4224 (Statement Claiming Exemption of Tax
on Income Effectively Connected with the Conduct of Business in the United
States) (or successor form) in order to claim an exemption from withholding. If
such Non-United States Holder is a foreign corporation, it may be subject to a
branch profits tax equal to 30% (or such lower rate provided by an applicable
treaty) of its effectively connected earnings and profits for the taxable year,
subject to certain adjustments. For purposes of the branch profits tax, interest
and OID on, and any gain recognized on the sale, exchange or other disposition
of, a new note will be included in the effectively connected earnings and
profits of such Non-United States Holder if such interest, OID or gain is
effectively connected with the conduct by the Non-United States Holder of a
trade or business in the United States.
INFORMATION REPORTING AND BACKUP WITHHOLDING
Under current United States federal income tax law, a 31% backup
withholding tax requirement applies to certain payments of interest and OID
accruals on, and the proceeds of a sale, exchange or redemption of, the new
notes. In addition, certain persons making such payments are required to submit
information returns (i.e., Internal Revenue Service Forms 1099) to the Service
with regard to those payments and OID accruals.
Backup withholding will generally not apply with respect to payments made
to certain "exempt recipients" such as corporations (within the meaning of
Section 7701 (a) of the Code) or certain tax-exempt entities. In the case of a
non-corporate United States Holder, backup withholding generally will apply only
if such Holder (i) fails to furnish to the payor in the manner required its
Taxpayer Identification Number ("TIN") which, for an individual, would be his
Social Security number, (ii) furnishes an incorrect TIN and the payor is so
notified by the Service, (iii) is notified by the Service that it has failed to
properly report payments of interest, OID or dividends and the payor is so
notified by the Service or (iv) under certain circumstances, fails to certify,
under penalties of perjury, that it has furnished a correct TIN and has not been
notified by the Service that it is subject to backup withholding for failure to
report interest, dividend payments or OID accruals.
In the case of a Non-United States Holder, under current United States
federal income tax law, information reporting on Internal Revenue Service Form
1099 (including Internal Revenue Service Form 1099B) and backup withholding will
not apply to payments of principal, interest or OID made by us or any paying
agent thereof on a new note if such Holder has provided the required
certification on Internal Revenue Service Form W-8 (see "--Tax Consequences to
Non-United States Holders") under penalties of perjury that it is not a United
States Holder or has otherwise established an exemption, provided in each case
that we or such paying agent, as the case may be, do not have actual knowledge
that the payee is a United States Holder. However, interest and OID on a new
note beneficially owned by a Non-United States Holder will be required to be
reported annually on Internal Revenue Service
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Form 1042S. If a Non-United States Holder does not provide the required
certification, such Holder may nevertheless avoid backup withholding or
information reporting in the circumstances described below, but such Holder
might be subject to withholding of United States income tax as described under
"--Tax Consequences to Non-United States Holders".
Under current United States federal income tax laws, if payments of
principal, interest or OID on a new note are made to or through a foreign office
of a custodian, nominee, broker or other agent acting on behalf of a beneficial
owner of a new note, such custodian, nominee, broker or other agent will not be
required to apply backup withholding to such payments made to such beneficial
owner and generally will not be subject to information reporting requirements.
However, if such custodian, nominee, broker or other agent is a United States
person for United States federal income tax purposes, a controlled foreign
corporation for United States federal income tax purposes, or a foreign person
50% or more of whose gross income is effectively connected with the conduct of a
United States trade or business for a specified three-year period, such
custodian, nominee, broker or other agent may be subject to certain information
reporting requirements with respect to such payments unless it has in its
records documentary evidence that the beneficial owner is a Non-United States
Holder and certain conditions are met or the beneficial owner otherwise
establishes an exemption.
Under current United States federal income tax law, payments on the sale,
exchange, redemption, retirement or other disposition of a new note made to or
through a foreign office of a broker generally will not be subject to backup
withholding and generally will not be subject to information reporting
requirements. Such payments, however, will be subject to information reporting
if the broker is a United States person for United States federal income tax
purposes, a controlled foreign corporation for United States federal income tax
purposes, or a foreign person 50% or more of whose gross income is effectively
connected with the conduct of a United States trade or business for a specified
three-year period, unless the broker has in its records documentary evidence
that the beneficial owner is a Non-United States Holder and certain other
conditions are met, or the beneficial owner otherwise establishes an exemption.
Such payments made to or through the United States office of a broker will be
subject to backup withholding and information reporting unless the Non-United
States Holder certifies, under penalties of perjury, that it is a Non-United
States Holder or otherwise establishes an exemption.
In general, the New Regulations do not significantly alter the substantive
backup withholding and information reporting requirements described above. As
under current law, backup withholding and information reporting will not apply
to (i) payments to a Non-United States Holder of principal, interest and OID and
(ii) payments to a Non-United States Holder on the sale, exchange, redemption,
retirement or other disposition of a new note, in each case if such Non-United
States Holder provides the required certification to establish an exemption from
the withholding of United States federal income tax or otherwise establishes an
exemption. Similarly, even in the absence of a Non-United States Holder
providing such certification or otherwise establishing an exemption, unless the
payor has actual knowledge that the payee is a United States Holder, backup
withholding will not apply to (i) payments of interest or OID made outside the
United States to certain offshore accounts and (ii) payments on the sale,
exchange, redemption, retirement or other disposition of a new note effected
outside the United States. However, information reporting (but not backup
withholding) will apply to (i) payments of interest and OID made by a payor
outside the United States and (ii) payments on the sale, exchange, redemption,
retirement or other disposition of a new note effected outside the United States
if payment is made by a broker that is, for United States federal income tax
purposes, (a) a United States person, (b) a controlled foreign corporation, (c)
a United States branch of a foreign bank or foreign insurance company, (d) a
foreign partnership controlled by United States persons or engaged in a United
States trade or business or (e) a foreign person 50% or more of whose gross
income is effectively connected with the conduct of a United States trade or
business for a specified three year period, in each case unless such payor or
broker has in its records documentary evidence that the beneficial owner is not
a United States Holder and certain other conditions are met or the beneficial
owner otherwise establishes an exemption (in which case, neither information
reporting nor backup withholding will apply). As noted above, the Service has
announced that
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the New Regulations will be amended to be effective generally for payments made
after December 31, 2000, subject to certain transition rules.
Backup withholding tax is not an additional tax. Rather, any amounts
'Withheld from a payment to a person under backup withholding rules are allowed
as a refund or a credit against such person's United States federal income tax,
provided that the required information is furnished to the Service.
Holders should consult their tax advisors regarding the application of
information reporting and backup withholding in their particular situations, the
availability of an exemption therefrom, and the procedure for obtaining such an
exemption, if available.
THE FOREGOING DISCUSSION IS FOR GENERAL INFORMATION AND IS NOT TAX ADVICE.
ACCORDINGLY, EACH PROSPECTIVE HOLDER SHOULD CONSULT ITS OWN TAX ADVISOR AS TO
THE PARTICULAR TAX CONSEQUENCES OF THE PROSPECTIVE HOLDER, INCLUDING THE
APPLICABILITY AND EFFECT OF ANY STATE, LOCAL, OR NON-UNITED STATES INCOME TAX
LAWS AND ANY RECENT OR PROSPECTIVE CHANGES IN APPLICABLE TAX LAWS.
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PLAN OF DISTRIBUTION
Each broker-dealer that receives new notes for its own account as a result
of market-making activities or other trading activities in connection with the
exchange offer must acknowledge that it will deliver a prospectus in connection
with any resale of new notes. This prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of new notes received in exchange for old notes where such old
notes were acquired as a result of market-making activities or other trading
activities. We have agreed to provide copies of this prospectus, as it may be
amended or supplemented from time to time, to any broker-dealer for a period of
one year from the date the exchange offer registration statement is declared
effective in order to facilitate those resales.
We will receive no proceeds in connection with the exchange offer or any
sale of new notes by broker-dealers. New notes received by broker-dealers for
their own account pursuant to the exchange offer may be sold from time to time
in one or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the new notes or a combination
of these methods of resale, at market prices prevailing at the time of resale,
at prices related to prevailing market prices or at negotiated prices. Any such
resale may be made directly to purchasers or to or through brokers or dealers
that may receive compensation in the form of commissions or concessions from the
broker-dealers or the purchasers of any new notes. Any broker-dealer that
resells new notes that were received by it for its own account pursuant to the
exchange offer and any broker or dealer that participates in a distribution of
new notes may be deemed to be an "underwriter" within the meaning of the
Securities Act of 1933, and any profit on any resale of new notes and any
commissions or concessions received by any such persons may be deemed to be
underwriting compensation under the Securities Act of 1933. The letter of
transmittal states that by acknowledging that it will deliver, and by
delivering, a prospectus, a broker-dealer will not be deemed to admit that it is
an "underwriter" within the meaning of the Securities Act of 1933.
We will promptly send additional copies of this prospectus and any
amendment or supplement to this prospectus to any broker-dealer that acquired
old notes for its own account as a result of market making activities or other
trading activities and that requests those documents in its letter of
transmittal. We have agreed to pay all expenses incident to the exchange offer,
including the reasonable fees and disbursements of not more than one counsel
chosen by the holders of the old notes, other than commissions or concessions of
any broker-dealers. We will also indemnify the holders of the old notes,
including broker-dealers, against liabilities, including liabilities under the
Securities Act of 1933, arising out of material misstatements or omissions
contained in the exchange offer registration statement or this prospectus, or
any amendment or supplement to those documents, unless the misstatements or
omissions are based upon written information provided by any holder expressly
for use in those documents.
LEGAL MATTERS
Mayer, Brown & Platt, Chicago, Illinois will pass on the validity of, and
certain legal matters concerning, the new notes.
EXPERTS
Our consolidated financial statements incorporated in this prospectus by
reference to our Annual Report on Form 10-K for the year ended March 31, 1999,
have been so incorporated in reliance on the report of PricewaterhouseCoopers
LLP, independent accountants, given on the authority of said firm as experts in
auditing and accounting.
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- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
$30,000,000
Exchange Offer
METAL MANAGEMENT, INC.
12 3/4% Senior Secured Notes due 2004
------------------------
PROSPECTUS
------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 93
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
(a) Section 145 of the Delaware General Corporation Law: (1) gives Delaware
corporations broad powers to indemnify their present and former directors and
officers and those of affiliated corporations against expenses incurred in the
defense of any lawsuit to which they are made parties by reason of being or
having been such directors or officers, subject to specified conditions and
exclusions, (2) gives a director or officer who successfully defends an action
the right to be so indemnified and (3) authorizes the registrant to buy
directors' and officers' liability insurance. Such indemnification is not
exclusive of any other rights to which those indemnified may be entitled under
any by-laws, agreement, vote of stockholders or otherwise.
(b) Article 13 of Metal Management's Amended and Restated Certificate of
Incorporation provides for indemnification of directors and officers to the
fullest extent permitted by law.
(c) In accordance with Section 102(b)(7) of the Delaware General
Corporation Law, Metal Management's Amended and Restated Certificate of
Incorporation provides that directors shall not be personally liable for
monetary damages for breaches of their fiduciary duty as directors except for
(1) breaches of their duty of loyalty to the registrant or its stockholders, (2)
acts or omissions not in good faith or that involve intentional misconduct or
knowing violations of law, (3) unlawful payment of dividends as prohibited by
Section 174 of the Delaware General Corporation Law or (4) transactions from
which a director derives an improper personal benefit.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) The exhibits filed as part of this registration statement are as
follows:
<TABLE>
<CAPTION>
EXHIBIT NO. EXHIBIT
- ----------- -------
<C> <S>
1.1 Purchase Agreement, dated May 5, 1999, among Metal
Management, its subsidiaries named therein and BT Alex.
Brown Incorporated (incorporated by reference to Exhibit
10.2 of Metal Management's Current Report on Form 8-K dated
May 7, 1999).
2.1 Stock Purchase Agreement, dated as of May 24, 1998, by and
among Metal Management, Joseph F. Naporano and Andrew J.
Naporano, Jr. (incorporated by reference to Exhibit 2.1 of
Metal Management's Current Report on Form 8-K dated July 1,
1998).
4.1 Indenture, dated as of May 13, 1998, among Metal Management,
the Guarantors (as defined therein) and LaSalle National
Bank, as Trustee (incorporated by reference to Exhibit 10.2
of Metal Management's Current Report on Form 8-K dated May
13, 1998).
4.2 First Supplemental Indenture, dated as of May 31, 1998,
executed by R&P Holdings, Inc., Charles Bluestone Company
and R&P Real Estate, Inc., amending Indenture, dated as of
May 13, 1998, among Metal Management, the Guarantors and
LaSalle National Bank, as Trustee (incorporated by reference
to Exhibit 4.12 of Metal Management's Annual Report on Form
10-K for the year ended March 31, 1998).
4.3 Second Supplemental Indenture, dated as of June 19, 1998,
executed by Metal Management Gulf Coast, Inc., amending
Indenture, dated as of May 13, 1998, among Metal Management,
the Guarantors and LaSalle National Bank, as Trustee
(incorporated by reference to Exhibit 4.13 of Metal
Management's Annual Report on Form 10-K for the year ended
March 31, 1998).
4.4 Third Supplemental Indenture, dated as of June 24, 1998,
executed by Newell Recycling West, Inc., amending Indenture,
dated as of May 13, 1998, among Metal Management, the
Guarantors and LaSalle National Bank, as Trustee
(incorporated by reference to Exhibit 4.14 of Metal
Management's Registration Statement on Form S-4 filed July
10, 1998).
</TABLE>
II-1
<PAGE> 94
<TABLE>
<CAPTION>
EXHIBIT NO. EXHIBIT
- ----------- -------
<C> <S>
4.5 Fourth Supplemental Indenture, dated as of July 1, 1998,
executed by Naporano Iron & Metal Co. and NIMCO Shredding
Co., amending Indenture, dated as of May 13, 1998, among
Metal Management, the Guarantors and LaSalle National Bank,
as Trustee (incorporated by reference to Exhibit 4.15 of
Metal Management's Registration Statement on Form S-4 filed
July 10, 1998).
4.6 Fifth Supplemental Indenture, dated as of July 1, 1998,
executed by Michael Schiavone & Sons, Inc. and Torrington
Scrap Company, amending Indenture, dated as of May 13, 1998,
among Metal Management, the Guarantors and LaSalle National
Bank, as Trustee (incorporated by reference to Exhibit 4.16
of Metal Management's Registration Statement on Form S-4
filed July 10, 1998).
4.7 Sixth Supplemental Indenture, dated as of July 7, 1998,
executed by Kimerling Acquisition Corp., amending Indenture,
dated as of May 13, 1998, among Metal Management, the
Guarantors and LaSalle National Bank, as Trustee
(incorporated by reference to Exhibit 4.17 of Metal
Management's Amendment No. 1 to Registration Statement on
Form S- 4 filed October 6, 1998).
4.8 Seventh Supplemental Indenture, dated as of July 9, 1998,
executed by Nicroloy Acquisition Corp., amending Indenture,
dated as of May 13, 1998, among Metal Management, the
Guarantors and LaSalle National Bank, as Trustee
(incorporated by reference to Exhibit 4.18 of Metal
Management's Amendment No. 1 to Registration Statement on
Form S- 4 filed October 6, 1998).
4.9 Eighth Supplemental Indenture, dated as of November 3, 1998,
executed by FPX, Inc., amending Indenture, dated as of May
13, 1998, among Metal Management, the Guarantors and LaSalle
National Bank, as Trustee (incorporated by reference to
Exhibit 4.3 of Metal Management's Quarterly Report on Form
10-Q for the quarter ended September 30, 1998).
4.10 Ninth Supplemental Indenture, dated as of November 3, 1998,
executed by PerlCo, L.L.C., amending Indenture, dated as of
May 13, 1998, among Metal Management, the Guarantors and
LaSalle National Bank, as Trustee (incorporated by reference
to Exhibit 4.4 of Metal Management's Quarterly Report on
Form 10-Q for the quarter ended September 30, 1998).
4.11 Indenture, dated as of May 7, 1999, among Metal Management,
the Guarantors (as defined therein) and Harris Trust and
Savings Bank, as Trustee (incorporated by reference to
Exhibit 4.1 of Metal Management's Current Report on Form 8-K
dated May 7, 1999).
4.12 Exchange and Registration Rights Agreement, dated as of May
13, 1998, by and among Metal Management, the Guarantors,
Goldman, Sachs & Co., BT Alex. Brown Incorporated and
Salomon Brothers Inc (incorporated by reference to Exhibit
10.3 of Metal Management's Current Report on Form 8-K dated
May 13, 1998).
4.13 Exchange and Registration Rights Agreement, dated as of May
7, 1999, among Metal Management, the Guarantors and BT Alex.
Brown Incorporated (incorporated by reference to Exhibit 4.2
of Metal Management's Current Report on Form 8-K dated May
7, 1999).
5.1** Opinion of Mayer, Brown & Platt, dated , 1999.
12.1** Computation of Ratio of Earnings to Fixed Charges.
23.1* Consent of PricewaterhouseCoopers LLP.
23.2** Consent of Mayer, Brown & Platt (included in the opinion
filed as Exhibit 5.1).
24.1 Powers of Attorney (included as part of the signature pages
hereof).
25.1* Form T-1 Statement of Eligibility under the Trust Indenture
Act of 1939 of Harris Trust and Savings Bank.
27.1* Financial Data Schedule.
</TABLE>
II-2
<PAGE> 95
<TABLE>
<CAPTION>
EXHIBIT NO. EXHIBIT
- ----------- -------
<C> <S>
99.1* Form of Letter of Transmittal for the 12 3/4% Senior Secured
Notes due 2004.
99.2* Form of Notice of Guaranteed Delivery.
</TABLE>
- -------------------------
* Included with this registration statement.
** To be included with an amendment to this registration statement.
(b) None required or applicable.
(c) Not applicable.
ITEM 22. UNDERTAKINGS
Each of the undersigned registrants hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(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) that, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Securities and Exchange Commission pursuant to Rule 424(b) if,
in the aggregate, the changes in volume and price represent no more than
a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement; 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 that remain unsold at the termination of the
offering.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Securities Exchange Act of 1934 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.
(5) 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 provisions described in Item 20 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
Securities Act of 1933 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
II-3
<PAGE> 96
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933 and will be
governed by the final adjudication of such issue.
(6) To respond to requests for information that is incorporated by
reference into the prospectus pursuant to Item 4, 10(b), 11 or 13 of this form
within one business day of receipt of such request and to send the incorporated
documents by first class mail or other equally prompt means. This includes
information contained in documents filed subsequent to the effective date of
this registration statement through the date of responding to the request.
(7) To supply by means of a post-effective amendment all information
concerning a transaction, and the company being acquired involved therein, that
was not the subject of and included in this registration statement when it
became effective.
II-4
<PAGE> 97
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
METAL MANAGEMENT, INC.
By: /s/ ALBERT A. COZZI
------------------------------------
Albert A. Cozzi
Director, Chairman of the Board,
President and Chief Operating
Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
SIGNATURE TITLE
- ----------------------------------------------------- ----------------------------------------------
<C> <S>
/s/ ALBERT A. COZZI Director, Chairman of the Board, President and
- ----------------------------------------------------- Chief Operating Officer (Principal Executive
Albert A. Cozzi Officer)
/s/ GEORGE A. ISAAC III Director and Executive Vice President
- -----------------------------------------------------
George A. Isaac III
/s/ JOSEPH F. NAPORANO Director and Vice Chairman of the Board
- -----------------------------------------------------
Joseph F. Naporano
/s/ FRANK J. COZZI Director and Vice President
- -----------------------------------------------------
Frank J. Cozzi
Director
- -----------------------------------------------------
Gregory P. Cozzi
</TABLE>
II-5
<PAGE> 98
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ GERARD M. JACOBS Director
- -----------------------------------------------------
Gerard M. Jacobs
Director
- -----------------------------------------------------
Eugene C. McCaffery
/s/ KENNETH A. MERLAU Director
- -----------------------------------------------------
Kenneth A. Merlau
/s/ TIMOTHY T. ORLOWSKI Director
- -----------------------------------------------------
Timothy T. Orlowski
/s/ WILLIAM T. PROLER Director
- -----------------------------------------------------
William T. Proler
/s/ ROBERT C. LARRY Executive Vice President, Finance, Treasurer
- ----------------------------------------------------- and Chief Financial Officer (Principal
Robert C. Larry Financial Officer)
/s/ AMIT N. PATEL Vice President, Finance and Controller
- ----------------------------------------------------- (Principal Accounting Officer)
Amit N. Patel
</TABLE>
II-6
<PAGE> 99
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
AEROSPACE METALS, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ PAUL I. HAVESON Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
Paul I. Haveson
/s/ ROBERT KASETA Vice President, Finance and Chief Accounting
- ----------------------------------------------------- Officer (Principal Financial and Accounting
Robert Kaseta Officer)
</TABLE>
II-7
<PAGE> 100
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
AMERICAN SCRAP PROCESSING, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ FRANK J. COZZI Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
Frank J. Cozzi
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Michael Mitchell
</TABLE>
II-8
<PAGE> 101
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
CALIFORNIA METALS RECYCLING, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ DANIEL B. BURGESS Director and Chairman of the Board
- -----------------------------------------------------
Daniel B. Burgess
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ JAMES MEJIA President and Chief Executive Officer
- ----------------------------------------------------- (Principal Executive Officer)
James Mejia
/s/ MEL CARLL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Mel Carll
</TABLE>
II-9
<PAGE> 102
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
CIM TRUCKING, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ FRANK J. COZZI Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
Frank J. Cozzi
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Michael Mitchell
</TABLE>
II-10
<PAGE> 103
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
COMETCO CORP.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ FRANK J. COZZI Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
Frank J. Cozzi
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Michael Mitchell
</TABLE>
II-11
<PAGE> 104
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
COZZI BUILDING CORPORATION
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ FRANK J. COZZI Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
Frank J. Cozzi
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Michael Mitchell
</TABLE>
II-12
<PAGE> 105
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
COZZI IRON & METAL, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ FRANK J. COZZI Director, President and Chief Executive
- ----------------------------------------------------- Officer
Frank J. Cozzi (Principal Executive Officer)
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Michael Mitchell
</TABLE>
II-13
<PAGE> 106
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
C SHREDDING CORP.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ FRANK J. COZZI Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
Frank J. Cozzi
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Michael Mitchell
</TABLE>
II-14
<PAGE> 107
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
EMCO TRADING, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ DANIEL B. BURGESS Director and Chairman of the Board
- -----------------------------------------------------
Daniel B. Burgess
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ KENNETH P. MUELLER Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
Kenneth P. Mueller
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Michael Mitchell
</TABLE>
II-15
<PAGE> 108
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
FERREX TRADING CORPORATION
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ GEORGE A. ISAAC, III Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
George A. Isaac, III
/s/ JUDY WILLIAMSON Vice President, Finance
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Judy Williamson
</TABLE>
II-16
<PAGE> 109
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
FIRMA, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ DANIEL B. BURGESS Director and Chairman of the Board
- -----------------------------------------------------
Daniel B. Burgess
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ JAMES MEJIA President and Chief Executive Officer
- ----------------------------------------------------- (Principal Executive Officer)
James Mejia
/s/ MEL CARLL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Mel Carll
</TABLE>
II-17
<PAGE> 110
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
FIRMA PLASTIC CO., INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ DANIEL B. BURGESS Director and Chairman of the Board
- -----------------------------------------------------
Daniel B. Burgess
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ JAMES MEJIA President and Chief Executive Officer
- ----------------------------------------------------- (Principal Executive Officer)
James Mejia
/s/ MEL CARLL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Mel Carll
</TABLE>
II-18
<PAGE> 111
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
FPX, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ FRANK J. COZZI Director, President and Chief Executive
- ----------------------------------------------------- Officer
Frank J. Cozzi (Principal Executive Officer)
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Michael Mitchell
</TABLE>
II-19
<PAGE> 112
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
HOUSTON COMPRESSED STEEL CORP.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ WILLIAM T. PROLER Director, Chairman of the Board, President and
- ----------------------------------------------------- Chief Executive Officer (Principal Executive
William T. Proler Officer)
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ DAVID SONNIER Vice President and Chief Financial Officer
- ----------------------------------------------------- (Principal Financial Officer)
David Sonnier
/s/ LEE HARRIS Chief Accounting Officer
- ----------------------------------------------------- (Principal Accounting Officer)
Lee Harris
</TABLE>
II-20
<PAGE> 113
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
HOUTEX METALS COMPANY, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ WILLIAM T. PROLER Director, Chairman of the Board, President and
- ----------------------------------------------------- Chief Executive Officer (Principal Executive
William T. Proler Officer)
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ DAVID SONNIER Vice President and Chief Financial Officer
- ----------------------------------------------------- (Principal Financial Officer)
David Sonnier
/s/ LEE HARRIS Chief Accounting Officer
- ----------------------------------------------------- (Principal Accounting Officer)
Lee Harris
</TABLE>
II-21
<PAGE> 114
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
THE ISAAC CORPORATION
BY: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ DAVID A. CARPENTER Director
- -----------------------------------------------------
David A. Carpenter
/s/ GEORGE A. ISAAC, III Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
George A. Isaac, III
/s/ JUDY WILLIAMSON Vice President, Finance
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Judy Williamson
</TABLE>
II-22
<PAGE> 115
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
KANKAKEE SCRAP CORPORATION
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ FRANK J. COZZI Director, Chairman of the Board and Chief
- ----------------------------------------------------- Executive Officer (Principal Executive
Frank J. Cozzi Officer)
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial Officer)
Michael Mitchell
</TABLE>
II-23
<PAGE> 116
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
KIMERLING ACQUISITION CORP.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ WILLIAM T. PROLER Director, Chairman of the Board, President and
- ----------------------------------------------------- Chief Executive Officer (Principal Executive
William T. Proler Officer)
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ DAVID SONNIER Vice President and Chief Financial Officer
- ----------------------------------------------------- (Principal Financial Officer)
David Sonnier
/s/ LEE HARRIS Treasurer and Chief Accounting Officer
- ----------------------------------------------------- (Principal Accounting Officer)
Lee Harris
</TABLE>
II-24
<PAGE> 117
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
MAC LEOD METALS CO.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ DANIEL B. BURGESS Director and Chairman of the Board
- -----------------------------------------------------
Daniel B. Burgess
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ JAMES MEJIA President and Chief Executive Officer
- ----------------------------------------------------- (Principal Executive Officer)
James Mejia
/s/ MEL CARLL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Mel Carll
</TABLE>
II-25
<PAGE> 118
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
METAL MANAGEMENT ARIZONA, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ DANIEL B. BURGESS Director and Chairman of the Board
- -----------------------------------------------------
Daniel B. Burgess
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ KENNETH P. MUELLER Director, President and Chief Executive
- ----------------------------------------------------- Officer
Kenneth P. Mueller (Principal Executive Officer)
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Michael Mitchell
</TABLE>
II-26
<PAGE> 119
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
METAL MANAGEMENT GULF COAST, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ WILLIAM T. PROLER Director, Chairman of the Board, President and
- ----------------------------------------------------- Chief Executive Officer (Principal Executive
William T. Proler Officer)
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ DAVID SONNIER Vice President and Chief Financial Officer
- ----------------------------------------------------- (Principal Financial Officer)
David Sonnier
/s/ LEE HARRIS Chief Accounting Officer
- ----------------------------------------------------- (Principal Accounting Officer)
Lee Harris
</TABLE>
II-27
<PAGE> 120
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
METAL MANAGEMENT PITTSBURGH, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ PAUL I. HAVESON Director
- -----------------------------------------------------
Paul I. Haveson
/s/ LARRY SNYDER President and Chief Executive Officer
- ----------------------------------------------------- (Principal Executive Officer)
Larry Snyder
/s/ TINA ZOTOLLA Chief Financial Officer and Chief Accounting
- ----------------------------------------------------- Officer
Tina Zotolla (Principal Financial and Accounting Officer)
</TABLE>
II-28
<PAGE> 121
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
METAL MANAGEMENT REALTY, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director, President and Chief Executive
- ----------------------------------------------------- Officer
Albert A. Cozzi (Principal Executive Officer)
/s/ ROBERT C. LARRY Vice President and Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Robert C. Larry
</TABLE>
II-29
<PAGE> 122
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
MICHAEL SCHIAVONE & SONS, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ ANDREW J. NAPORANO, JR. President and Chief Executive Officer
- ----------------------------------------------------- (Principal Executive Officer)
Andrew J. Naporano, Jr.
/s/ JAMES KEACH Chief Financial Officer and Treasurer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
James Keach
</TABLE>
II-30
<PAGE> 123
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
NAPORANO IRON & METAL CO.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ JOSEPH F. NAPORANO Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
Joseph F. Naporano
/s/ ANDREW J. NAPORANO, JR. Director and Senior Vice President
- -----------------------------------------------------
Andrew J. Naporano, Jr.
/s/ JOHN NAPORANO Chief Financial Officer
- ----------------------------------------------------- (Principal Financial Officer)
John Naporano
/s/ JOHN TIZIANI Chief Accounting Officer
- ----------------------------------------------------- (Principal Accounting Officer)
John Tiziani
</TABLE>
II-31
<PAGE> 124
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
NEWELL RECYCLING WEST, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ DANIEL B. BURGESS Director and Chairman of the Board
- -----------------------------------------------------
Daniel B. Burgess
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ G. ROBERT TRIESCH, III Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
G. Robert Triesch, III
/s/ CLIFF VELLINGA Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Cliff Vellinga
</TABLE>
II-32
<PAGE> 125
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
NIMCO SHREDDING CO.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ JOSEPH F. NAPORANO Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
Joseph F. Naporano
/s/ ANDREW J. NAPORANO, JR. Director and Senior Vice President
- -----------------------------------------------------
Andrew J. Naporano, Jr.
/s/ JOHN NAPORANO Chief Financial Officer
- ----------------------------------------------------- (Principal Financial Officer)
John Naporano
/s/ JOHN TIZIANI Chief Accounting Officer
- ----------------------------------------------------- (Principal Accounting Officer)
John Tiziani
</TABLE>
II-33
<PAGE> 126
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
138 SCRAP, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ FRANK J. COZZI Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
Frank J. Cozzi
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Michael Mitchell
</TABLE>
II-34
<PAGE> 127
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
PERLCO, L.L.C.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ FRANK J. COZZI President and Chief Executive Officer of Cozzi
- ----------------------------------------------------- Iron & Metal, Inc. and FPX, Inc., all of the
Frank J. Cozzi members of PerlCo, L.L.C.
President and Chief Executive Officer of
PerlCo, L.L.C. (Principal Executive Officer)
/s/ MICHAEL MITCHELL Chief Financial Officer of PerlCo, L.L.C.
- ----------------------------------------------------- (Principal Financial Officer)
Michael Mitchell
/s/ ODUS WILEY Chief Accounting Officer of PerlCo, L.L.C.
- ----------------------------------------------------- (Principal Accounting Officer)
Odus Wiley
</TABLE>
II-35
<PAGE> 128
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
P. JOSEPH IRON & METAL, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ GEORGE A. ISAAC, III Director, President and Chief Executive
- ----------------------------------------------------- Officer
George A. Isaac, III (Principal Executive Officer)
/s/ STEFANIE VAUGHT Vice President and Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Stefanie Vaught
</TABLE>
II-36
<PAGE> 129
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
PROLER SOUTHWEST INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ WILLIAM T. PROLER Director, Chairman of the Board, President and
- ----------------------------------------------------- Chief Executive Officer (Principal Executive
William T. Proler Officer)
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ DAVID SONNIER Vice President and Chief Financial Officer
- ----------------------------------------------------- (Principal Financial Officer)
David Sonnier
/s/ LEE HARRIS Chief Accounting Officer
- ----------------------------------------------------- (Principal Accounting Officer)
Lee Harris
</TABLE>
II-37
<PAGE> 130
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
PROLER STEELWORKS, L.L.C.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Manager
- -----------------------------------------------------
Albert A. Cozzi
/s/ WILLIAM T. PROLER Manager, President and Chief Executive Officer
- ----------------------------------------------------- (Principal Executive Officer)
William T. Proler
/s/ ROBERT C. LARRY Vice President
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Robert C. Larry
</TABLE>
II-38
<PAGE> 131
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
R&P HOLDINGS, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ LARRY SNYDER President and Chief Executive Officer
- ----------------------------------------------------- (Principal Executive Officer)
Larry Snyder
/s/ TINA ZOTOLLA Chief Financial Officer and Chief Accounting
- ----------------------------------------------------- Officer
Tina Zotolla (Principal Financial and Accounting Officer)
</TABLE>
II-39
<PAGE> 132
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
RESERVE IRON & METAL LIMITED
PARTNERSHIP
By: P. Joseph Iron & Metal, Inc.,
its general partner
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director of P. Joseph Iron & Metal, Inc.
- -----------------------------------------------------
Albert A. Cozzi
/s/ GEORGE A. ISAAC, III Director, President and Chief Executive
- ----------------------------------------------------- Officer of P. Joseph Iron & Metal, Inc.
George A. Isaac, III (Principal Executive Officer)
/s/ STEFANIE VAUGHT Vice President and Chief Financial Officer of
- ----------------------------------------------------- P. Joseph Iron & Metal, Inc.
Stefanie Vaught (Principal Financial and Accounting Officer)
</TABLE>
II-40
<PAGE> 133
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
SALT RIVER RECYCLING, L.L.C.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ DANIEL B. BURGESS Manager and Chairman
- -----------------------------------------------------
Daniel B. Burgess
/s/ ALBERT A. COZZI Manager
- -----------------------------------------------------
Albert A. Cozzi
/s/ KENNETH P. MUELLER Manager, President and Chief Executive Officer
- ----------------------------------------------------- (Principal Executive Officer)
Kenneth P. Mueller
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Michael Mitchell
</TABLE>
II-41
<PAGE> 134
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
SCRAP PROCESSING, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ FRANK J. COZZI Director, President and Chief Executive
- ----------------------------------------------------- Officer (Principal Executive Officer)
Frank J. Cozzi
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Michael Mitchell
</TABLE>
II-42
<PAGE> 135
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
TORRINGTON SCRAP COMPANY
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ ANDREW J. NAPORANO, JR. President and Chief Executive Officer
- ----------------------------------------------------- (Principal Executive Officer)
Andrew J. Naporano, Jr.
/s/ JAMES KEACH Chief Financial Officer and Treasurer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
James Keach
</TABLE>
II-43
<PAGE> 136
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
TROJAN TRADING CO.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ DANIEL B. BURGESS Director and Chairman of the Board
- -----------------------------------------------------
Daniel B. Burgess
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ JAMES MEJIA President and Chief Executive Officer
- ----------------------------------------------------- (Principal Executive Officer)
James Mejia
/s/ MEL CARLL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Mel Carll
</TABLE>
II-44
<PAGE> 137
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN CHICAGO, ILLINOIS ON JULY 22, 1999.
USA SOUTHWESTERN CARRIER, INC.
By: /s/ DAVID A. CARPENTER
------------------------------------
David A. Carpenter
Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE
APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS ALBERT A. COZZI AS HIS
ATTORNEY-IN-FACT AND AGENT WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION,
FOR HIM AND IN HIS NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN,
EACH AND ALL AMENDMENTS TO THIS REGISTRATION STATEMENT (INCLUDING POST-EFFECTIVE
AMENDMENTS), TO SIGN ANY ADDITIONAL REGISTRATION STATEMENTS FOR THE SAME
OFFERING AND AMENDMENTS TO THE SAME, WITH EXHIBITS THERETO AND OTHER DOCUMENTS
IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO THE ATTORNEY-IN-FACT AND AGENT, FULL POWER AND AUTHORITY TO DO AND PERFORM
EACH AND EVERY ACT AND THING REQUISITE OR NECESSARY TO BE DONE IN AND ABOUT THE
PREMISES, AS FULLY TO ALL INTENTS AND PURPOSES AS HE MIGHT OR COULD DO IN
PERSON, HEREBY SATISFYING AND CONFIRMING THAT THE ATTORNEY-IN-FACT AND AGENT, OR
HIS SUBSTITUTES, MAY LAWFULLY DO OR CEASE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON JULY 22, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ DANIEL B. BURGESS Director and Chairman of the Board
- -----------------------------------------------------
Daniel B. Burgess
/s/ ALBERT A. COZZI Director
- -----------------------------------------------------
Albert A. Cozzi
/s/ KENNETH P. MUELLER Director, President and Chief Executive
- ----------------------------------------------------- Officer
Kenneth P. Mueller (Principal Executive Officer)
/s/ MICHAEL MITCHELL Chief Financial Officer
- ----------------------------------------------------- (Principal Financial and Accounting Officer)
Michael Mitchell
</TABLE>
II-45
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-4 of Metal Management, Inc. of our report dated June 25,
1999 relating to the consolidated financial statements and financial statement
schedule appearing in Metal Management, Inc.'s Annual Report on Form 10-K for
the year ended March 31, 1999. We also consent to the reference to us under the
heading "Experts" in such Registration Statement.
PricewaterhouseCoopers LLP
Chicago, Illinois
July 22, 1999
<PAGE> 1
EXHIBIT 25.1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
Statement of Eligibility
Under the Trust Indenture Act of 1939
of a Corporation Designated to Act as Trustee
Check if an Application to Determine Eligibility
of a Trustee Pursuant to Section 305(b)(2) ______
HARRIS TRUST AND SAVINGS BANK
(Name of Trustee)
Illinois 36-1194448
(State of Incorporation) (I.R.S. Employer Identification No.)
111West Monroe Street, Chicago, Illinois
60603 (Address of principal executive offices)
Daniel G. Donovan, Harris Trust and Savings Bank,
311 West Monroe Street, Chicago, Illinois, 60606
(312) 461-2908 phone (312) 461-3525 facsimile
(Name, address and telephone number for agent for service)
METAL MANAGEMENT, INC.
(Obligor)
Delaware 94-2835068
(State of Incorporation) (I.R.S. Employer Identification No.)
500 N. Dearborn, Suite 405
Chicago, Illinois 60610
(Address of principal executive offices)
12 3/4% Senior Secured Notes, due 2004
(Title of indenture securities)
<PAGE> 2
1. GENERAL INFORMATION. Furnish the following information as to the Trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Commissioner of Banks and Trust Companies, State of Illinois,
Springfield, Illinois; Chicago Clearing House Association, 164
West Jackson Boulevard, Chicago, Illinois; Federal Deposit
Insurance Corporation, Washington, D.C.; The Board of
Governors of the Federal Reserve System, Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Harris Trust and Savings Bank is authorized to exercise
corporate trust powers.
2. AFFILIATIONS WITH OBLIGOR. If the Obligor is an affiliate of the Trustee,
describe each such affiliation.
The Obligor is not an affiliate of the Trustee.
3. through 15.
NO RESPONSE NECESSARY
16. LIST OF EXHIBITS.
1. A copy of the articles of association of the Trustee as now in effect
which includes the authority of the trustee to commence business and
to exercise corporate trust powers.
A copy of the Certificate of Merger dated April 1, 1972 between
Harris Trust and Savings Bank, HTS Bank and Harris Bankcorp, Inc.
which constitutes the articles of association of the Trustee as now
in effect and includes the authority of the Trustee to commence
business and to exercise corporate trust powers was filed in
connection with the Registration Statement of Louisville Gas and
Electric Company, File No. 2-44295, and is incorporated herein by
reference.
2. A copy of the existing by-laws of the Trustee.
A copy of the existing by-laws of the Trustee was filed in connection
with the Registration Statement of Commercial Federal Corporation,
File No. 333-20711, and is incorporated herein by reference.
3. The consents of the Trustee required by Section 321(b) of the Act.
(included as Exhibit A on page 2 of this statement)
4. A copy of the latest report of condition of the Trustee published
pursuant to law or the requirements of its supervising or examining
authority.
(included as Exhibit B on page 3 of this statement)
1
<PAGE> 3
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the Trustee,
HARRIS TRUST AND SAVINGS BANK, a corporation organized and existing under the
laws of the State of Illinois, has duly caused this statement of eligibility to
be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago, and State of Illinois, on the 23rd day of July, 1999.
HARRIS TRUST AND SAVINGS BANK
By: /s/ D. G. DONOVAN
-------------------------------
D. G. Donovan
Assistant Vice President
EXHIBIT A
The consents of the trustee required by Section 321(b) of the Act.
Harris Trust and Savings Bank, as the Trustee herein named, hereby consents that
reports of examinations of said trustee by Federal and State authorities may be
furnished by such authorities to the Securities and Exchange Commission upon
request therefor.
HARRIS TRUST AND SAVINGS BANK
By: /s/ D. G. DONOVAN
-------------------------------
D. G. Donovan
Assistant Vice President
2
<PAGE> 4
EXHIBIT B
Attached is a true and correct copy of the statement of condition of Harris
Trust and Savings Bank as of March 31, 1999, as published in accordance with a
call made by the State Banking Authority and by the Federal Reserve Bank of the
Seventh Reserve District.
[LOGO] HARRIS BANK
Harris Trust and Savings Bank
111 West Monroe Street
Chicago, Illinois 60603
of Chicago, Illinois, And Foreign and Domestic Subsidiaries, at the close of
business on March 31, 1999, a state banking institution organized and operating
under the banking laws of this State and a member of the Federal Reserve System.
Published in accordance with a call made by the Commissioner of Banks and Trust
Companies of the State of Illinois and by the Federal Reserve Bank of this
District.
Bank's Transit Number 71000288
<TABLE>
<CAPTION>
THOUSANDS
ASSETS OF DOLLARS
<S> <C> <C>
Cash and balances due from depository institutions:
Non-interest bearing balances and currency and coin.......................... $ 1,237,336
Interest bearing $ 137,061
balances...................................................................................
Securities:................................................................................
a. Held-to-maturity securities $ 0
b. Available-for-sale securities $ 5,455,837
Federal funds sold and securities purchased under agreements to resell $ 87,250
Loans and lease financing receivables:
Loans and leases, net of unearned income..................................... $ 9,500,293
LESS: Allowance for loan and lease losses................................... $ 109,979
------------
Loans and leases, net of unearned income, allowance, and reserve
(item 4.a minus 4.b)......................................................... $ 9,390,314
Assets held in trading accounts............................................................ $ 161,168
Premises and fixed assets (including capitalized leases)................................... $ 255,438
Other real estate owned.................................................................... $ 243
Investments in unconsolidated subsidiaries and associated companies........................ $ 75
Customer's liability to this bank on acceptances outstanding............................... $ 40,869
Intangible assets.......................................................................... $ 254,549
Other assets............................................................................... $ 1,183,465
------------
TOTAL ASSETS $ 18,203,605
============
</TABLE>
3
<PAGE> 5
<TABLE>
<CAPTION>
LIABILITIES
<S> <C> <C>
Deposits:
In domestic offices.......................................................................... $ 9,099,851
Non-interest bearing................................................................ $ 2,743,074
Interest bearing.................................................................... $ 6,356,777
In foreign offices, Edge and Agreement subsidiaries, and IBF's............................... $ 1,822,400
Non-interest bearing................................................................ $ 26,371
Interest bearing.................................................................... $ 1,796,029
Federal funds purchased and securities sold under agreements to repurchase in domestic offices
of the bank and of its Edge and Agreement subsidiaries, and in IBF's:
Federal funds purchased & securities sold under agreements to repurchase.......................... $ 3,354,582
Trading Liabilities 96,517
Other borrowed money:............................................................................. $ 1,681,346
a. With remaining maturity of one year or less $ 0
b. With remaining maturity of more than one year
Bank's liability on acceptances executed and outstanding $ 40,869
Subordinated notes and debentures................................................................. $ 225,000
Other liabilities................................................................................. $ 390,234
-----------
TOTAL LIABILITIES $16,890,799
===========
EQUITY CAPITAL
Common stock...................................................................................... $ 100,000
Surplus........................................................................................... $ 608,510
a. Undivided profits and capital reserves........................................................ $ 616,084
b. Net unrealized holding gains (losses) on available-for-sale securities $ (11,788)
-----------
TOTAL EQUITY CAPITAL $ 1,312,806
===========
Total liabilities, limited-life preferred stock, and equity capital.............................. $18,203,605
===========
</TABLE>
I, Pamela Piarowski, Vice President of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the Board of Governors of the Federal Reserve System and
is true to the best of my knowledge and belief.
PAMELA PIAROWSKI
4/30/99
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and, to the best of our
knowledge and belief, has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and the
Commissioner of Banks and Trust Companies of the State of Illinois and is true
and correct.
EDWARD W. LYMAN,
ALAN G. McNALLY,
JAMES J. GLASSER
Directors.
4
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> MAR-31-1999
<PERIOD-START> APR-01-1998
<PERIOD-END> MAR-31-1999
<CASH> 2,482,000
<SECURITIES> 0
<RECEIVABLES> 105,780,000
<ALLOWANCES> 2,020,000
<INVENTORY> 60,443,000
<CURRENT-ASSETS> 181,393,000
<PP&E> 198,983,000
<DEPRECIATION> 27,743,000
<TOTAL-ASSETS> 667,736,000
<CURRENT-LIABILITIES> 95,499,000
<BONDS> 180,000,000
<COMMON> 489,000
0
19,997,000
<OTHER-SE> 218,718,000
<TOTAL-LIABILITY-AND-EQUITY> 667,736,000
<SALES> 805,274,000
<TOTAL-REVENUES> 805,274,000
<CGS> 740,061,000
<TOTAL-COSTS> 740,061,000
<OTHER-EXPENSES> 98,178,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 31,332,000
<INCOME-PRETAX> (64,070,000)
<INCOME-TAX> (17,036,000)
<INCOME-CONTINUING> (47,034,000)
<DISCONTINUED> 117,000
<EXTRAORDINARY> (938,000)
<CHANGES> 0
<NET-INCOME> (49,670,000)
<EPS-BASIC> (1.24)
<EPS-DILUTED> (1.24)
</TABLE>
<PAGE> 1
EXHIBIT 99.1
LETTER OF TRANSMITTAL
METAL MANAGEMENT, INC.
Offer to Exchange
12 3/4% Senior Secured Notes due 2004
which have been registered under the Securities Act
of 1933 for all outstanding 12 3/4% Senior Secured
Notes due 2004
pursuant to the prospectus dated , 1999.
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON , 1999, UNLESS EXTENDED (THE "EXPIRATION DATE").
The Exchange Agent for the Exchange Offer is:
HARRIS TRUST AND SAVINGS BANK
By Hand, Registered or Certified Mail or Overnight Courier:
Harris Trust and Savings Bank
311 West Monroe Street
Chicago, Illinois 60606
Attention: Daniel G. Donovan
By Facsimile:
(312) 461-3525
Attention: Daniel G. Donovan
Confirm by Telephone: (312) 461-2908
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL VIA FACSIMILE TO A
NUMBER OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE VALID DELIVERY. THE
INSTRUCTIONS CONTAINED HEREIN SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF
TRANSMITTAL IS COMPLETED.
The undersigned hereby acknowledges receipt of the prospectus dated
, 1999 (as it may be amended or supplemented from time to time, the
"Prospectus") of Metal Management, Inc., a Delaware corporation (the "Company"),
and this Letter of Transmittal, which together constitute the Company's offer
(the "Exchange Offer") to exchange an aggregate of up to $30,000,000 principal
amount of its 12 3/4% Senior Secured Notes due 2004 (the "New Notes"), which
have been registered under the Securities Act of 1933, as amended (the
"Securities Act"), pursuant to a registration statement of which the Prospectus
is a part, for an identical principal amount of its outstanding 12 3/4% Senior
Secured Notes due 2004 (the "Old Notes"). The term "Expiration Date" shall mean
5:00 p.m., New York City time on , 1999, unless the Exchange Offer is
extended, in which case the term "Expiration Date" means the latest date and
time to which the Exchange Offer is extended. Capitalized terms used but not
defined herein have the meaning given to them in the Prospectus.
This Letter of Transmittal is to be used (i) if certificates of Old Notes
are to be forwarded herewith, (ii) if delivery of Old Notes is to be made by
book-entry transfer to an account maintained by the Exchange Agent at The
Depository Trust Company (the "Depository" or "DTC") pursuant to the procedures
set forth in "The Exchange Offer--Procedures for Tendering Old Notes" in the
Prospectus or (iii) if tender of the
<PAGE> 2
Old Notes is to be made according to the guaranteed delivery procedures
described in the Prospectus under the caption "The Exchange Offer--Guaranteed
Delivery Procedures."
Holders who wish to tender their Old Notes and (i) whose Old Notes are not
immediately available, (ii) who cannot deliver their Old Notes, this Letter of
Transmittal or any other documents required by this Letter of Transmittal to the
Exchange Agent on or prior to the Expiration Date or (iii) who cannot complete
the procedure for book-entry transfer on a timely basis, may tender their Old
Notes according to the guaranteed delivery procedures set forth herein. See
Instruction 2.
YOUR BANK OR BROKER CAN ASSIST YOU IN COMPLETING THIS FORM. THE
INSTRUCTIONS INCLUDED WITH THIS LETTER OF TRANSMITTAL MUST BE FOLLOWED.
QUESTIONS AND REQUESTS FOR ASSISTANCE OR FOR ADDITIONAL COPIES OF THE PROSPECTUS
AND THIS LETTER OF TRANSMITTAL MAY BE DIRECTED TO THE EXCHANGE AGENT.
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
List below the Old Notes to which this Letter of Transmittal relates. If
the space provided below is inadequate, list the certificate numbers and
principal amount on a separate signed schedule and attach that schedule to this
Letter of Transmittal. See Instruction 4.
ALL TENDERING HOLDERS COMPLETE THIS BOX:
<TABLE>
<S> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OLD NOTES TENDERED
- --------------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER
(FILL IN, IF BLANK) OLD NOTES TENDERED
- --------------------------------------------------------------------------------------------------------------
AGGREGATE
PRINCIPAL
CERTIFICATE OR AMOUNT
REGISTRATION REPRESENTED PRINCIPAL AMOUNT
NUMBER(S)* BY OLD NOTES TENDERED**
--------------------------------------------------
$ $
--------------------------------------------------
--------------------------------------------------
--------------------------------------------------
--------------------------------------------------
TOTAL AMOUNT TENDERED: $ $
- --------------------------------------------------------------------------------------------------------------
* Need not be completed by book-entry holders. Such holders should check the appropriate box below and
provide the requested information.
** Unless otherwise indicated, the holder will be deemed to have tendered the full aggregate principal amount
represented by such Old Notes. All tenders must be in integral multiples of $1,000.
- --------------------------------------------------------------------------------------------------------------
</TABLE>
2
<PAGE> 3
The undersigned has completed, executed and delivered this Letter of
Transmittal to indicate the action the undersigned desires to take with respect
to the Exchange Offer. Holders who wish to tender their Old Notes must complete
this letter in its entirety.
(THE FOLLOWING BOXES ARE TO BE CHECKED BY ELIGIBLE INSTITUTIONS ONLY.)
[ ] CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT AT DTC AND
COMPLETE THE FOLLOWING:
Name of Tendering Institution:
- --------------------------------------------------------------------------------
DTC Account Number:
- --------------------------------------------------------------------------------
Transaction Code Number:
- --------------------------------------------------------------------------------
[ ] CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE
OF GUARANTEED DELIVERY AND COMPLETE THE FOLLOWING:
Name(s) of Registered Holder(s):
- --------------------------------------------------------------------------------
Date of Execution of Notice of Guaranteed Delivery:
- --------------------------------------------------------------
Name of Eligible Institution Which Guaranteed Delivery:
- ----------------------------------------------------------
If Guaranteed Delivery is to be made by book-entry transfer:
DTC Account Number:
- --------------------------------------------------------------------------------
Transaction Code Number:
- --------------------------------------------------------------------------------
[ ] CHECK HERE IF YOU ARE A BROKER-DEALER WHO ACQUIRED OLD NOTES FOR YOUR OWN
ACCOUNT AS A RESULT OF MARKET-MAKING ACTIVITIES OR OTHER TRADING ACTIVITIES
(A "PARTICIPATING BROKER-DEALER") AND WISH TO RECEIVE 10 ADDITIONAL COPIES
OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.
Name:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Telephone Number and Contact Person:
- ----------------------------------------------------------------------------
3
<PAGE> 4
LADIES AND GENTLEMEN:
Upon the terms and subject to the conditions of the Exchange Offer, the
undersigned hereby tenders to the Company the above described principal amount
of Old Notes in exchange for an identical principal amount of New Notes. Subject
to, and effective upon, the acceptance for exchange of the Old Notes tendered
herewith, the undersigned hereby exchanges, assigns and transfers to or upon the
order of the Company all right, title and interest in and to such Old Notes as
are being tendered herewith, including all rights to accrued and unpaid interest
thereon as of the Expiration Date. The undersigned hereby irrevocably
constitutes and appoints the Exchange Agent as its agent and attorney-in-fact
(with full knowledge that the Exchange Agent is also acting as agent of the
Company in connection with the Exchange Offer) to cause the Old Notes to be
assigned, transferred and exchanged.
THE UNDERSIGNED HEREBY REPRESENTS AND WARRANTS THAT THE UNDERSIGNED HAS
FULL POWER AND AUTHORITY TO TENDER, EXCHANGE, ASSIGN AND TRANSFER THE OLD NOTES
TENDERED HEREBY AND TO ACQUIRE NEW NOTES ISSUABLE UPON THE EXCHANGE OF SUCH
TENDERED OLD NOTES, AND THAT, WHEN THE OLD NOTES ARE ACCEPTED FOR EXCHANGE, THE
COMPANY WILL ACQUIRE GOOD, MARKETABLE AND UNENCUMBERED TITLE THERETO, FREE AND
CLEAR OF ALL LIENS, RESTRICTIONS, CHARGES AND ENCUMBRANCES, AND THAT THE OLD
NOTES TENDERED HEREBY ARE NOT SUBJECT TO ANY ADVERSE CLAIMS OR PROXIES. THE
UNDERSIGNED WILL, UPON REQUEST, EXECUTE AND DELIVER ANY ADDITIONAL DOCUMENTS
DEEMED BY THE COMPANY OR THE EXCHANGE AGENT TO BE NECESSARY OR DESIRABLE TO
COMPLETE THE EXCHANGE, ASSIGNMENT AND TRANSFER OF THE OLD NOTES TENDERED HEREBY.
THE UNDERSIGNED HAS READ AND AGREES TO ALL OF THE TERMS OF THE EXCHANGE OFFER.
The undersigned understands that tenders of Old Notes pursuant to any one
of the procedures described in "The Exchange Offer--Procedures for Tendering Old
Notes" in the Prospectus and in the instructions herein will, upon the Company's
acceptance for exchange of such tendered Old Notes, constitute a binding
agreement between the undersigned and the Company upon the terms and subject to
the conditions of the Exchange Offer.
The undersigned also warrants that it will, upon request, execute and
deliver any additional documents deemed by the Exchange Agent or the Company to
be necessary or desirable to complete the exchange, assignment and transfer of
tendered Old Notes or transfer ownership of such Old Notes on the account books
maintained by a book-entry transfer facility. The undersigned further agrees
that acceptance of any tendered Old Notes by the Company and the issuance of New
Notes in exchange therefor shall constitute performance in full by the Company
of its obligations under the Registration Right. Agreement and that the Company
shall have no further obligations or liabilities thereunder for the registration
of the Old Notes or the New Notes.
The Exchange Offer is not conditioned upon any principal amount of Old
Notes being tendered for exchange. However, the Exchange Offer is subject to
certain conditions set forth in the Prospectus under the caption "The Exchange
Offer--Conditions of the Exchange Offer." The undersigned recognizes that as a
result of these conditions (which may be waived, in whole or in part, by the
Company), as more particularly set forth in the Prospectus, the Company may not
be required to exchange any of the Old Notes tendered hereby and, in such event,
the Old Notes not exchanged will be returned to the undersigned at the address
shown below the signature of the undersigned.
The name(s) and addressee(s) of the registered holder(s) of the Old Notes
tendered hereby should be printed above, if they are not already set forth
above, as they appear on the Certificates representing such Old Notes. The
Certificate number(s) and the Old Notes that the undersigned wishes to tender
should be indicated in the appropriate boxes above.
The undersigned acknowledges that this Exchange Offer is being made in
reliance on the position of the staff of the Securities and Exchange Commission
(the "Commission") as set forth in certain interpretive letters addressed to
third parties in other transactions substantially similar to the Exchange Offer,
which lead
4
<PAGE> 5
the Company to believe that New Notes issued pursuant to the Exchange Offer to a
holder in exchange for Old Notes may be offered for resale, resold and otherwise
transferred by a holder (other than (i) a broker-dealer who purchased Old Notes
directly from the Company for resale pursuant to Rule 144A or any other
available exemption under the Securities Act, (ii) an "affiliate" of the Company
within the meaning of Rule 405 under the Securities Act or (iii) a broker-dealer
who acquired the Old Notes as a result of market-making or other trading
activities) without further compliance with the registration and prospectus
delivery provisions of the Securities Act, provided, that such holder is
acquiring the New Notes in the ordinary course of business and is not
participating, and has no arrangement or understanding with any person to
participate, in the distribution of the New Notes. Accordingly, the undersigned
represents that (i) it is not an "affiliate" of the Company as defined in Rule
405 of the Securities Act, (ii) it is not a broker-dealer that acquired Old
Notes directly from the Company in order to resell them pursuant to Rule 144A of
the Securities Act or any other available exemption under the Securities Act,
(iii) it will acquire the New Notes in the ordinary course of business and (iv)
it is not participating, and does not intend to participate, and has no
arrangement or understanding with any person to participate, in the distribution
of the New Notes. The undersigned acknowledges that if it is unable to make
these representations to the Company, it will not be able to rely on the
interpretations of the staff of the Commission described above and therefore
will be required to comply with the registration and prospectus delivery
requirements of the Securities Act in connection with any sale or other transfer
of such Old Notes unless such sale is made pursuant to an exemption from such
requirements. If the undersigned is a broker-dealer that will receive New Notes
for its own account in exchange for Old Notes, it represents that it acquired
the Old Notes for its own account as a result of market-making activities or
other trading activities and acknowledges that it will deliver a prospectus
meeting the requirements of the Securities Act in connection with any resale of
such New Notes; however, by so acknowledging and by delivering a prospectus, the
undersigned will not be deemed to admit that it is an "underwriter" within the
meaning of Section 2(11) of the Securities Act. Failure to comply with any of
the above-mentioned requirements could result in the undersigned or any such
other person incurring liability under the Securities Act for which such persons
are not indemnified by the Company.
Unless otherwise indicated in the box entitled "Special Exchange
Instructions" or the box entitled "Special Delivery Instructions" in this Letter
of Transmittal, certificates for all New Notes delivered in exchange for
tendered Old Notes, and any Old Notes delivered herewith but not exchanged, will
be registered in the name of the undersigned and shall be delivered to the
undersigned at the address shown below the signature of the undersigned. If a
New Note is to be issued to a person other than the person(s) signing this
Letter of Transmittal, or if the New Note is to be mailed to someone other than
the person(s) signing this Letter of Transmittal or to the person(s) signing
this Letter of Transmittal at an address different than the address shown on
this letter of Transmittal, the appropriate boxes of this Letter of Transmittal
should be completed. If Old Notes are surrendered by holder(s) that have
completed either the box entitled "Special Exchange Instructions" or the box
entitled "Special Delivery Instructions" in this Letter of Transmittal,
signature(s) on this Letter of Transmittal must be guaranteed by an Eligible
Institution (as defined in Instruction 2).
All authority herein conferred or agreed to be conferred in this Letter of
Transmittal shall survive the death or incapacity of the undersigned and any
obligation of the undersigned hereunder shall be binding upon the heirs,
executors, administrators, personal representatives, trustees in bankruptcy,
legal representatives, successors and assigns of the undersigned. Tendered Old
Notes may be withdrawn in accordance with Instruction 3 hereto at any time prior
to the Expiration Date.
THE UNDERSIGNED, BY COMPLETING THE BOX ENTITLED "DESCRIPTION OF OLD NOTES
TENDERED" ABOVE AND SIGNING THIS LETTER, WILL BE DEEMED TO HAVE TENDERED THE OLD
NOTES AS SET FORTH IN SUCH BOX.
5
<PAGE> 6
REGISTERED HOLDERS OF OLD NOTES SIGN HERE
(IN ADDITION, COMPLETE SUBSTITUTE FORM W-9 BELOW)
PLEASE SIGN HERE
- ------------------------------------------------------
Authorized Signature of Registered Holder
PLEASE SIGN HERE
- ------------------------------------------------------
Authorized Signature of Registered Holder
Must be signed by registered holder(s) exactly as name(s) appear(s) on the
Old Notes or on a security position listing as the owner of the Old Notes or by
person(s) authorized to become registered holder(s) by properly completed bond
powers transmitted herewith. See Instruction 4. If signature is by
attorney-in-fact, trustee, executor, administrator, guardian, officer of a
corporation or other person acting in a fiduciary or representative capacity,
please provide the following information:
Name:
Title:
Address:
Telephone Number:
Dated:
- ------------------------------------------------------
Taxpayer Identification or Social Security Number
Name:
Title:
Address:
Telephone Number:
Dated:
- ------------------------------------------------------
Taxpayer Identification or Social Security Number
6
<PAGE> 7
SIGNATURE GUARANTEE
(IF REQUIRED--SEE INSTRUCTION 4)
Signature(s) Guaranteed by an
Eligible Institution:
--------------------------------
Authorized Signature
Name of Eligible Institution
Guaranteeing Signature:
- --------------------------
Capacity (full title):
- ------------------------------
Telephone Number:
- ------------------------------
Date:
- -----------------------------------------------
Address:
- -------------------------------------------
- -----------------------------------------------------
- -----------------------------------------------------
SPECIAL EXCHANGE INSTRUCTIONS
(SEE INSTRUCTIONS 4 AND 5)
To be completed ONLY if the New Notes or any Old Notes that are not
tendered or not accepted are to be issued in the name of someone other than the
undersigned.
Issue: [ ] New Notes to:
[ ] Old Notes to:
Name(s)
- -------------------------------------------
Address
- --------------------------------------------
- -------------------------------------------------------
Telephone Number:
- --------------------------------
Book-Entry Transfer Facility Account:
- ------------
- -------------------------------------------------------
- -------------------------------------------------------
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER)
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 4 AND 5)
To be completed ONLY if the New Notes or any Old Notes that are not
tendered or not accepted are to be sent to someone other than the undersigned,
or to the undersigned at an address other than that shown above under
"Description of Old Notes Tendered."
Mail: [ ] New Notes to:
[ ] Old Notes to:
Name(s)
- -------------------------------------------
Address
- --------------------------------------------
- -------------------------------------------------------
Telephone Number:
- --------------------------------
- -------------------------------------------------------
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER)
7
<PAGE> 8
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER
1. DELIVERY OF THIS LETTER OF TRANSMITTAL AND CERTIFICATES.
All physically delivered Old Notes or confirmation of any book-entry
transfer to the Exchange Agent's account at DTC, as well as a properly completed
and duly executed copy of this Letter of Transmittal (or facsimile thereof), and
any other documents required by this Letter of Transmittal, must be received by
the Exchange Agent at any of its addresses set forth herein on or prior to the
Expiration Date. The method of delivery of this Letter of Transmittal, the Old
Notes and all other required documents is at the election and risk of the
holder. Instead of delivery by mail, it is recommended that holders use an
overnight or hand delivery service. Except as otherwise provided below, the
delivery will be deemed made only when actually received by the Exchange Agent.
Any beneficial holder whose Old Notes are registered in the name of a
broker, dealer, commercial bank, trust company or other nominee and who wishes
to tender Old Notes in the Exchange Offer should contact such registered holder
promptly and instruct such registered holder to tender on such beneficial
holder's behalf. If such beneficial holder wishes to tender directly, such
beneficial holder must, prior to completing and executing the Letter of
Transmittal and tendering Old Notes, either make appropriate arrangements to
register ownership of the Old Notes in such beneficial holder's own name or
obtain a properly completed bond power from the registered holder. Beneficial
holders should be aware that the transfer of registered ownership may take
considerable time.
Delivery to an address other than as set forth herein, or instructions via
a facsimile number other than the ones set forth herein, will not constitute a
valid delivery.
The Company expressly reserves the right, at any time or from time to time,
to extend the Expiration Date by complying with certain conditions set forth in
the Prospectus.
LETTERS OF TRANSMITTAL SHOULD NOT BE SENT TO THE COMPANY OR TO DTC.
2. GUARANTEED DELIVERY PROCEDURES.
Holders who wish to tender their Old Notes and (i) whose Old Notes are not
immediately available, (ii) who cannot deliver their Old Notes, the Letter of
Transmittal or any other required documents to the Exchange Agent prior to the
Expiration Date or (iii) who cannot complete the procedures for book-entry
transfers on a timely basis, may effect a tender if:
a. the tender is made through a member firm of a registered national
securities exchange or of the National Association of Securities Dealers,
Inc., a commercial bank or trust company having an office or correspondent
in the United States or an "eligible guarantor institution" within the
meaning of Rule 17Ad-15 under the Exchange Act (an "Eligible Institution");
b. prior to the Expiration Date, the Exchange Agent receives from such
holder and the Eligible Institution a properly completed and duly executed
Notice of Guaranteed Delivery (by facsimile transmission, mail or hand
delivery) setting forth the name and address of the holder of the Old
Notes, the certificate or registration number(s) of the tendered Old Notes,
and the principal amount of Old Notes tendered, stating that the tender is
being made thereby and guaranteeing that, at least within four (4) New York
Stock Exchange trading days after the Expiration Date, the tendered Old
Notes, a duly executed Letter of Transmittal (or facsimile thereof) and any
other required documents will be deposited by the Eligible Institution with
the Exchange Agent; and
c. a properly completed and duly executed Letter of Transmittal (or
facsimile thereof), any other required documents and tendered Old Notes in
proper form for transfer (or a confirmation of book-entry transfer of such
Old Notes into the Exchange Agent's account at DTC) must be received by the
8
<PAGE> 9
Exchange Agent at least within four (4) New York Stock Exchange trading
days after the Expiration Date.
Any holder who wishes to tender Old Notes pursuant to the guaranteed
delivery procedures described above must ensure that the Exchange Agent receives
the Notice of Guaranteed Delivery relating to such Old Notes prior to the
Expiration Date. Failure to complete the guaranteed delivery procedures outlined
above will not, of itself, affect the validity or effect a revocation of any
Letter of Transmittal form properly completed and executed by a holder who
attempted to use the guaranteed delivery procedures.
3. PARTIAL TENDERS: WITHDRAWALS.
Tenders of Old Notes will be accepted only in integral multiples of $1,000
principal amount at maturity. If less than the entire principal amount of Old
Notes evidenced by a submitted certificate is tendered, the tendering holder
should fill in the principal amount tendered in the column entitled "Principal
Amount Tendered" of the box entitled "Description of Old Notes Tendered." A
newly issued Old Note for the principal amount of Old Notes submitted but not
tendered will be sent to such holder, unless the appropriate boxes on this
Letter of Transmittal are completed, as soon as practicable after the Expiration
Date. All Old Notes delivered to the Exchange Agent will be deemed to have been
tendered in full unless otherwise indicated.
Any Old Notes tendered pursuant to the Exchange Offer may be withdrawn at
any time prior to the Expiration Date, after which tenders of Old Notes are
irrevocable. To withdraw a tender of Old Notes in the Exchange Offer, a written
or facsimile transmission notice of withdrawal must be received by the Exchange
Agent by 5:00 p.m., New York City time, on the Expiration Date. Any such notice
of withdrawal must (i) specify the name of the person having deposited the Old
Notes to be withdrawn (the "Depositor"), (ii) identify the Old Notes to be
withdrawn (including the certificate or registration number(s) and principal
amount of such Old Notes, or, in the case of Old Notes transferred by book-entry
transfer, the name and number of the account at DTC to be credited), (iii) be
signed by the Depositor in the same manner as the original signature on this
Letter of Transmittal (including any required signature guarantees) or be
accompanied by a bond power in the name of the person withdrawing the tender, in
satisfactory form as determined by the Company in its sole discretion, duly
executed by the registered holder, with the signature thereon guaranteed by a
Eligible Institution together with the other documents required upon transfer by
the Indenture, (iv) specify the name in which such Old Notes are to be
registered, if different from that of the Depositor, pursuant to such documents
of transfer, and (v) include a statement that such holder is withdrawing his
election to have such Old Notes exchanged. All questions as to the validity,
form and eligibility (including time of receipt) of such notices will be
determined by the Company, in its sole discretion, whose determination shall be
final and binding on all parties. Any Old Notes so withdrawn will be deemed not
to have been validly tendered for purposes of the Exchange Offer and no New
Notes will be issued with respect thereto unless the Old Notes so withdrawn are
validly retendered. Any Old Notes which have been tendered but which are not
accepted for exchange will be returned to the holder thereof without cost to
such holder as promptly as practicable after withdrawal.
4. SIGNATURE ON THIS LETTER OF TRANSMITTAL; WRITTEN INSTRUMENTS AND
ENDORSEMENTS; GUARANTEE OF SIGNATURES.
If this Letter of Transmittal is signed by the registered holder(s) of the
Old Notes tendered hereby, the signature must correspond with the name(s) as
written on the face of the certificates without alteration or enlargement or any
change whatsoever. If this Letter of Transmittal is signed by a participant in
DTC, the signature must correspond with the name as it appears on the security
position listing as the owner of the Old Notes.
If any of the Old Notes tendered hereby are owned of record by two or more
joint owners, all such owners must sign this Letter of Transmittal.
9
<PAGE> 10
If a number of Old Notes registered in different names are tendered, it
will be necessary to complete, sign and submit as many separate copies of this
Letter of Transmittal as there are different registrations of Old Notes.
Signatures on this Letter of Transmittal or a notice of withdrawal, as the
case may be, must be guaranteed by an Eligible Institution unless the Old Notes
tendered hereby are tendered (i) by a registered holder who has not completed
the box entitled "Special Exchange Instructions" or "Special Delivery
Instructions" on the Letter of Transmittal or (ii) for the account of an
Eligible Institution.
If this Letter of Transmittal is signed by the registered holder or holders
of Old Notes (which term, for the purposes described herein, shall include a
participant in DTC whose name appears on a security listing as the owner of the
Old Notes) listed and tendered hereby, no endorsements of the tendered Old Notes
or separate written instruments of transfer or exchange are required. In any
other case, the registered holder (or acting holder) must either properly
endorse the Old Notes or transmit properly completed bond powers with this
Letter of Transmittal (in either case executed exactly as the name(s) of the
registered holder(s) appear(s) on the Old Notes, and, with respect to a
participant in DTC whose name appears on a security position listing as the
owner of Old Notes, exactly as the name of the participant appears on such
security position listing), with the signature on the Old Notes or bond power
guaranteed by an Eligible Institution (except where the Old Notes are tendered
for the account of an Eligible Institution).
If this Letter of Transmittal, any certificates or separate written
instruments of transfer or exchange are signed by attorneys-in-fact, trustees,
executors, administrators, guardians, officers of corporations or others acting
in a fiduciary or representative capacity, such persons should so indicate when
signing, and, unless waived by the Company, proper evidence satisfactory to the
Company of their authority so to act must be submitted.
5. SPECIAL EXCHANGE AND DELIVERY INSTRUCTIONS.
Tendering holders should indicate, in the applicable box, the name and
address (or account at DTC) in which the New Notes or Old Notes for principal
amounts not tendered or not accepted for exchange are to be issued and delivered
(or deposited), if different from the names and addresses or accounts of the
person signing this Letter of Transmittal. In the case of issuance in a
different name, the taxpayer identification number or social security number of
the person named must also be indicated and the tendering holder should complete
the applicable box.
If no instructions are given, the New Notes (and any Old Notes not tendered
or not accepted) will be issued in the name of and delivered to the acting
holder of the Old Notes or deposited at such holder's account at the Depository.
6. TRANSFER TAXES.
The Company shall pay all transfer taxes, if any, applicable to the
exchange of Old Notes pursuant to the Exchange Offer. If, however, certificates
representing New Notes or Old Notes for principal amounts not tendered or
accepted for exchange are to be delivered to, or are to be registered or issued
in the name of, any person other than the registered holder of the Old Notes
tendered, or if tendered Old Notes are registered in the name of any person
other than the person signing the Letter of Transmittal, or if a transfer tax is
imposed for any reason other than the exchange of Old Notes pursuant to the
Exchanged Offer, then the amount of any such transfer taxes (whether imposed on
the registered holder or any other person) will be payable by the tendering
holder. If satisfactory evidence of payment of such taxes or exemption therefrom
is not submitted herewith, the amount of such transfer taxes will be billed
directly to such tendering holder.
Except as provided in this Instruction 6, it will not be necessary for
transfer stamps to be affixed to the Old Notes listed in the Letter of
Transmittal.
10
<PAGE> 11
7. WAIVER OF CONDITIONS.
The Company reserves the absolute right to waive, in whole or in part, any
of the specified conditions to the Exchange Offer set forth in the Prospectus.
8. MUTILATED, LOST, STOLEN OR DESTROYED NOTES.
Any holder whose Old Notes have been mutilated, lost, stolen or destroyed
should contact the Exchange Agent at the address indicated above for further
instructions.
9. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES.
Questions relating to the procedure for tendering, as well as requests for
additional copies of the Prospectus and this Letter of Transmittal may be
directed to the Exchange Agent at the address and telephone number set forth
above.
10. VALIDITY AND FORM.
All questions as to the validity, form, eligibility (including time of
receipt), acceptance of tendered Old Notes and withdrawal of tendered Old Notes
will be determined by the Company in its sole discretion, which determination
will be final and binding. The Company reserves the absolute right to reject any
and all Old Notes not properly tendered or any Old Notes the Company's
acceptance of which would, in the opinion of counsel for the Company, be
unlawful. The Company also reserves the absolute right to waive any
irregularities or conditions of tender as to particular Old Notes either before
or after the Expiration Date (including the right to waive the ineligibility of
any holder who seeks to tender Old Notes in the Exchange Offer). The Company's
interpretation of the terms and conditions of the Exchange Offer (including the
instructions in this Letter of Transmittal) will be final and binding on all
parties. Unless waived, any defects or irregularities in connection with tenders
of Old Notes must be cured within such time as the Company shall determine.
Neither the Company, the Exchange Agent nor any other person shall be under any
duty to give notification of defects or irregularities with respect to tenders
of Old Notes, nor shall any of them incur any liability for failure to give such
notification. Tenders of Old Notes will not be deemed to have been made until
such irregularities have been cured or waived. Any Old Notes received by the
Exchange Agent that are not properly tendered and as to which the defects or
irregularities have not been cured or waived will be returned without cost to
such holder by the Exchange Agent to the tendering holders of Old Notes, unless
otherwise provided herein, as soon as practicable following the Expiration Date.
11. IMPORTANT TAX INFORMATION.
Under U.S. federal income tax law, a holder tendering Old Notes is required
to provide the Exchange Agent with such holder's correct taxpayer identification
number ("TIN") on Substitute Form W-9 above. If such holder is an individual,
the TIN is the holder's social security number. The Certificate of Awaiting
Taxpayer Identification Number should be completed if the tendering holder has
not been issued a TIN and has applied for a number or intends to apply for a
number in the near future. If the Exchange Agent is not provided with the
correct TIN, the holder may be subject to a $50 penalty imposed by the Internal
Revenue Service. In addition, payments that are made to such holder with respect
to tendered Old Notes may be subject to backup withholding.
Certain holders (including, among others, all domestic corporations and
certain foreign individuals and foreign entities) are not subject to these
backup withholding and reporting requirements. Such a holder who satisfies one
or more of the conditions set forth in Part 2 of the Substitute Form W-9 should
execute the certification following such Part 2. In order for a foreign holder
to qualify as an exempt recipient, that holder must submit to the Exchange Agent
a properly completed Internal Revenue Service Form W-9, signed under penalties
of perjury, attesting to that holder's exempt status. A copy of such form is
attached to this Letter of Transmittal.
11
<PAGE> 12
If backup withholding applies, the Exchange Agent is required to withhold
31% of any amounts otherwise payable to the holder. Backup withholding is not an
additional tax. Rather, the tax liability of persons subject to backup
withholding will be reduced by the amount of tax withheld. If withholding
results in an overpayment of taxes, a refund may be obtained from the Internal
Revenue Service.
To prevent backup withholding on payments that are made to a holder with
respect to Old Notes tendered for exchange, the holder is required to notify the
Exchange Agent of his or her correct TIN by completing the form herein
certifying that the TIN provided on Substitute Form W-9 is correct (or that such
holder is awaiting a TIN) and that (i) such holder is exempt, (ii) such holder
has not been notified by the Internal Revenue Service that he or she is subject
to backup withholding as a result of failure to report all interest or dividends
or (iii) the Internal Revenue Service has notified such holder that he or she is
no longer subject to backup withholding.
Each holder is required to give the Exchange Agent the social security
number or employer identification number of the record holder(s) of the Old
Notes. If Old Notes are in more than one name or are not in the name of the
actual holder, consult the instructions on Internal Revenue Service Form W-9,
which are attached to this Letter of Transmittal, for additional guidance on
which number to report.
If the tendering holder has not been issued a TIN and has applied for a
number or intends to apply for a number in the near future, write "Applied For"
in the space for the TIN on Substitute Form W-9, sign and date the form and the
Certificate of Awaiting Taxpayer Identification Number and return them to the
Exchange Agent. If such certificate is completed and the Exchange Agent is not
provided with the TIN within 60 days, the Exchange Agent will withhold 31% of
all payments made thereafter until a TIN is provided to the Exchange Agent.
IMPORTANT: THIS LETTER OF TRANSMITTAL OR A FACSIMILE THEREOF (TOGETHER WITH
OLD NOTES OR CONFIRMATION OF BOOK-ENTRY TRANSFER AND ALL OTHER REQUIRED
DOCUMENTS) OR A NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE EXCHANGE
AGENT ON OR PRIOR TO THE EXPIRATION DATE.
12
<PAGE> 13
TO BE COMPLETED BY ALL TENDERING SECURITY HOLDERS:
PAYOR'S NAME: METAL MANAGEMENT, INC.
<TABLE>
<C> <S> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------
SUBSTITUTE Part 1 -- PLEASE PROVIDE YOUR TIN ON THE LINE SOCIAL SECURITY NUMBER
FORM W-9 AT RIGHT AND CERTIFY BY SIGNING AND DATING OR EMPLOYER
BELOW IDENTIFICATION NUMBER
------------------------------
----------------------------------------------------------------------------------
DEPARTMENT OF THE TREASURY Part 2 -- CERTIFICATION -- Under penalties of perjury, I certify that:
INTERNAL REVENUE SERVICE (1) The number shown on this form is my correct taxpayer identification number
(or I am waiting for a number to be issued to me);
(2) I am not subject to backup withholding either because: (a) I am exempt from
backup withholding; (b) I have not been notified by the Internal Revenue
Service ("IRS") that I am subject to backup withholding as a result of a
failure to report all interest or dividends; or (c) the IRS has notified me
that I am no longer subject to backup withholding; and
(3) Any other information provided on this form is true and correct.
</TABLE>
<TABLE>
<C> <S> <C> <C>
----------------------------------------------------------------------------------
PAYOR'S REQUEST FOR TAXPAYER'S CERTIFICATION INSTRUCTIONS -- YOU MUST CROSS OUT ITEM
IDENTIFICATION (2) ABOVE IF YOU HAVE BEEN NOTIFIED BY THE IRS THAT
NUMBER (TIN) YOU ARE SUBJECT TO BACKUP WITHHOLDING BECAUSE OF
UNDERREPORTING INTEREST OR DIVIDENDS ON YOUR TAX
RETURN AND YOU HAVE NOT BEEN NOTIFIED BY THE IRS THAT Part 3 --
YOU ARE NO LONGER SUBJECT TO BACKUP WITHHOLDING. Awaiting
TIN [ ]
SIGNATURE -----------------------------------------
DATE ------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU
CHECKED THE BOX IN PART 3 OF THE SUBSTITUTE FORM W-9.
- --------------------------------------------------------------------------------
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has
not been issued to me, and either (1) I have mailed or delivered an
application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or
(2) I intend to mail or deliver an application in the near future. I
understand that if I do not provide a taxpayer identification number by the
time of payment, 31% of all payments made to me on account of the Exchange
Notes shall be retained until I provide a taxpayer identification number to
the Exchange Agent and that, if I do not provide my taxpayer identification
number within 60 days, such retained amounts shall be remitted to the Internal
Revenue Service as backup withholding and 31% of all reportable payments made
to me thereafter will be withheld and remitted to the Internal Revenue Service
until I provide a taxpayer identification number.
SIGNATURE:
----------------------------------------------------------- DATE:
------------------------------------
- --------------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY IN CERTAIN CIRCUMSTANCES
RESULT IN BACKUP WITHHOLDING OF 31% OF ANY AMOUNTS PAID TO YOU PURSUANT TO
THE EXCHANGE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR
CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR
ADDITIONAL DETAILS.
13
<PAGE> 1
EXHIBIT 99.2
NOTICE OF GUARANTEED DELIVERY
FOR TENDER OF
12 3/4% SENIOR SECURED NOTES DUE 2004
(INCLUDING THOSE IN BOOK-ENTRY FORM)
OF
METAL MANAGEMENT, INC.
This Notice of Guaranteed Delivery, or one substantially equivalent to this
form, and the related Letter of Transmittal (the "Letter of Transmittal") must
be used to accept the Exchange Offer (as defined below) of Metal Management,
Inc., a Delaware corporation (the "Company"), made pursuant to the prospectus,
dated , 1999 (as it may be amended or supplemented from time to time,
the "Prospectus"), if (i) certificates for the outstanding 12 3/4% Senior
Secured Notes due 2004 of the Company (the "Old Notes") are not immediately
available, (ii) time will not permit the Letter of Transmittal (together with
the documents required by such Letter of Transmittal) to reach Harris Trust and
Savings Bank (the "Exchange Agent") on or prior to 5:00 p.m. New York City time
on the Expiration Date (as defined herein), or (iii) Holders cannot complete the
procedure for book-entry transfer on a timely basis. Such form may be delivered
or transmitted by facsimile transmission, mail or hand delivery to the Exchange
Agent as set forth below. In addition, in order to utilize the guaranteed
delivery procedure to tender the Old Notes pursuant to the Exchange Offer, a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof), any other required documents and tendered Old Notes in proper form for
transfer (or confirmation of a book-entry transfer of such Old Notes into the
Exchange Agent's account at DTC) must also be received by the Exchange Agent
prior to 5:00 p.m., New York City time, within four (4) New York Stock Exchange
trading days after the Expiration Date. Capitalized terms not defined herein are
defined in the Prospectus.
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME,
ON , 1999, UNLESS EXTENDED (THE "EXPIRATION DATE").
The Exchange Agent for the Exchange Offer is:
HARRIS TRUST AND SAVINGS BANK
By Hand, Registered or Certified Mail or Overnight Courier:
Harris Trust and Savings Bank
311 West Monroe Street
Chicago, Illinois 60606
Attention: Daniel G. Donovan
By Facsimile:
(312) 461-3525
Attention: Daniel G. Donovan
Confirm by Telephone: (312) 461-2908
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE OR TRANSMISSION OF THIS NOTICE OF GUARANTEED DELIVERY VIA
FACSIMILE TO A NUMBER OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID
DELIVERY.
This Notice of Guaranteed Delivery is not to be used to guarantee
signatures. If a signature on a Letter of Transmittal is required to be
guaranteed by an "Eligible Institution" under the instructions thereto, such
signature guarantee must appear in the applicable space provided in the
signature box on the Letter of Transmittal.
<PAGE> 2
LADIES AND GENTLEMEN:
The undersigned hereby tenders to the Company, upon the terms and subject
to the conditions set forth in the Prospectus and the Letter of Transmittal
(which together constitute the "Exchange Offer"), receipt of which are hereby
acknowledged, the aggregate principal amount of Old Notes set forth below
pursuant to the guaranteed delivery procedure described in Instruction 2 of the
Letter of Transmittal.
Name(s) of Registered Holder(s):
(Please Print or Type)
Principal Amount of Old Notes Tendered:
$
Certificate No(s). (if available):
* Must be in denominations of principal amount of $1,000 and any integral
multiple thereof.
If Old Notes will be delivered by book-entity transfer to DTC, provide the
DTC account number.
DTC Account Number: ____________
All authority herein conferred or agreed to be conferred shall survive the
death or incapacity of the undersigned and every obligation of the undersigned
hereunder shall be binding upon the heirs, executors, administrators, personal
representatives, trustees in bankruptcy, legal representatives, successors and
assigns of the undersigned.
PLEASE SIGN HERE
Must be signed by the holder(s) of Old Notes as their name(s) appear(s) on
certificates for Old Notes or on a security position listing, or by person(s)
authorized to become registered holder(s) by endorsement and documents
transmitted with this Notice of Guaranteed Delivery.
- ------------------------------------------------------
- ------------------------------------------------------
Signature(s) of Holder(s) or Authorized Signatory
- ------------------------------------------------------
- ------------------------------------------------------
Date
Area Code and Telephone Number:
If signature is by attorney-in-fact, trustee, executor, administrator,
guardian, officer or other person acting in a fiduciary or representative
capacity, such person must set forth his or her full title below.
Please print name(s) and address(es)
Name(s) of Holder(s)
Title/Capacity:
Address(es):
2
<PAGE> 3
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a member firm of a registered national securities exchange
or of the National Association of Securities Dealers, Inc., a commercial bank or
trust company having an office or a correspondent in the United States or an
"eligible guarantor institution" within the meaning of Rule 17Ad-15 under the
Securities Exchange Act of 1934, as amended, hereby guarantees that the
undersigned will deliver to the Exchange Agent the certificates representing the
Old Notes being tendered hereby in proper form for transfer (or a confirmation
of book-entry transfer of such Old Notes into the Exchange Agent's account at
the book-entry transfer facility of DTC) with a properly completed and duly
executed Letter of Transmittal (or facsimile thereof) and any other required
documents, all within four (4) New York Stock Exchange trading days after the
Expiration Date.
The institution that completes this form must communicate the guarantee to
the Exchange Agent by the Expiration Date, and must deliver the certificates
representing any Old Notes (or a confirmation of book-entry transfer of such Old
Notes into the Exchange Agent's account at DTC),the Letter of Transmittal (or
facsimile thereof) and any other required documents to the Exchange Agent within
the time period shown herein. Failure to do so could result in a financial loss
to such institution.
- ------------------------------------------------------
Name of Firm
- ------------------------------------------------------
Address
- ------------------------------------------------------
Zip Code
- ------------------------------------------------------
Telephone Number
- ------------------------------------------------------
Authorized Signature
- ------------------------------------------------------
Name (Please Type or Print)
- ------------------------------------------------------
Title
Dated: , 1998
NOTE: DO NOT SEND CERTIFICATES OF OLD NOTES WITH THIS FORM. CERTIFICATES FOR OLD
NOTES SHOULD ONLY BE SENT WITH YOUR LETTER OF TRANSMITTAL.
3
