<PAGE> 1
As filed with the Securities and Exchange Commission on September 24, 1996
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM S-3
REGISTRATION STATEMENT
Under the
Securities Act of 1933
THE CERPLEX GROUP, INC.
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE 33-0411354
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
1382 BELL AVENUE
TUSTIN, CALIFORNIA 92780
(714) 258-5600
(Address, Including Zip Code, and Telephone Number, Including
Area Code, of Registrant's Principal Executive Offices)
JAMES T. SCHRAITH
PRESIDENT AND CHIEF EXECUTIVE OFFICER
THE CERPLEX GROUP, INC.
1382 BELL AVENUE
TUSTIN, CALIFORNIA 92780
(714) 258-5600
(Name, Address, Including Zip Code, and Telephone Number
Including Area Code, of Agent for Service)
---------------------
Copies to:
FREDERIC A. RANDALL, JR., ESQ.
BROBECK, PHLEGER & HARRISON LLP
4675 MACARTHUR COURT, SUITE 1000
NEWPORT BEACH, CALIFORNIA 92660
(714) 752-7535
---------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration Statement.
---------------------
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the Prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
====================================================================================================
TITLE OF EACH CLASS AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
OF SECURITIES TO BE AGGREGATE AGGREGATE REGISTRATION
TO BE REGISTERED REGISTERED PRICE PER SHARE OFFERING PRICE FEE
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 12,611,808 shares(1) $5.44 (2) $68,608,235 $23,658
====================================================================================================
</TABLE>
(1) Includes the resale of Common Stock, the resale of Common Stock
issuable upon the exercise of warrants and the resale of Common Stock
issuable upon the conversion of Series B Preferred Stock. The number of
shares of Common Stock issuable, and the number of shares of Common
Stock registered hereunder, may be increased as a result of stock
dividends or stock splits with respect to the Company's Common Stock,
or as a result of the application of the antidilution provisions of the
outstanding warrants and Series B Preferred Stock.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) of the Securities Act of 1933, as amended,
based on the average of the high and low selling price per share of the
Company's Common Stock on September 18, 1996, as reported on the Nasdaq
National Market.
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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<PAGE> 2
THE CERPLEX GROUP, INC.
12,611,808 SHARES
COMMON STOCK
-----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
-------------------------------
THE COMMON STOCK OFFERED HEREBY HAS A HIGH DEGREE
OF RISK. SEE "RISK FACTORS" BEGINNING ON PAGE 3.
-------------------------------
This Prospectus relates to the offer and sale, which is not being
underwritten, of an aggregate of 12,611,808 shares of Common Stock, $.001 par
value per share (the "Shares"), of The Cerplex Group, Inc. ("Cerplex" or the
"Company"). The Shares may be offered from time to time by certain of the
Company's security holders, or by the security holder's pledgees, donees,
transferees or other successors in interest (the "Selling Security Holders") for
their own account.
Such sales may be made on the Nasdaq National Market or otherwise at
prices and at terms then prevailing or at prices related to the then current
market price, or in negotiated transactions. The Shares may be sold by one or
more of the following: (a) a block trade in which the broker or dealer so
engaged will attempt to sell the Shares as agent but may position and resell a
portion of the block as principal to facilitate the transaction; (b) purchases
by a broker or dealer as principal and resale by such broker or dealer for its
account pursuant to this Prospectus; (c) an exchange distribution in accordance
with the rules of such exchange; and (d) ordinary brokerage transactions and
transactions in which the broker solicits purchasers. In effecting sales,
brokers or dealers engaged by the Selling Security Holders may arrange for other
brokers or dealers to participate. Brokers or dealers will receive commissions
or discounts from Selling Security Holders in amounts to be negotiated
immediately prior to the sale. Such brokers or dealers and any other
participating brokers or dealers may be deemed to be "underwriters" within the
meaning of Section 2(11) the Securities Act of 1933, as amended (the "Securities
Act"), in connection with such sales. In addition, any securities covered by
this Prospectus which qualify for sale pursuant to Rule 144 may be sold under
Rule 144 rather than pursuant to this Prospectus. The Company has also agreed to
bear certain expenses in connection with the registration and sale of the Shares
offered hereby by the Selling Security Holders (other than broker discounts and
commissions). See "Selling Security Holders" and "Plan of Distribution."
The Company will not receive any part of the proceeds from sales of Shares
by the Selling Security Holders. See "Use of Proceeds."
The Company's Common Stock is traded on the Nasdaq National Market under
the symbol "CPLX." On September 9, 1996, the last reported sale price of the
Company's Common Stock on the Nasdaq National Market was $7.00 per share.
THE DATE OF THIS PROSPECTUS IS SEPTEMBER __, 1996
<PAGE> 3
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS IN CONNECTION WITH
THE OFFERING MADE HEREBY, AND IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY, ANY SELLING SECURITY HOLDER OR BY ANY OTHER PERSON. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE THEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT INFORMATION HEREIN IS CORRECT AS OF
ANY TIME SUBSEQUENT TO THE DATE HEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE AN
OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY THE SHARES TO ANY PERSON OR
BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION MAY NOT
LAWFULLY BE MADE.
THE COMPANY
Cerplex is an independent provider of electronic parts repair and
logistics services. The Company has developed extensive capabilities in the
repair, refurbishment, upgrade and testing of a wide range of electronic
equipment for the computer and peripheral, telecommunications and office
automation markets. The Company's key service offerings are depot repair,
logistics services and spare parts management and sales, as well as a variety of
ancillary services. The Company's extensive network of domestic and European
facilities enables it to service the diverse needs of leading electronic
equipment manufacturers.
The principal executive offices of Cerplex are located at 1382 Bell
Avenue, Tustin, California 92780. Cerplex's telephone number is (714) 258-5600.
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<PAGE> 4
RISK FACTORS
This Prospectus contains forward-looking statements which involve risks
and uncertainties. Actual results could differ materially from those discussed
in the forward-looking statements. Certain of the factors that could cause
actual results to differ materially are discussed below. An investment in the
Common Stock being offered by this Prospectus involves a high degree of risk. In
addition to the other information contained in this Prospectus, prospective
investors should carefully consider the following risk factors before purchasing
the Common Stock offered by this Prospectus.
Losses and Accumulated Deficit. For the six-month period ended June 30,
1996 and the year ended December 31, 1995, the Company reported a net loss of
$871,000 and $39.4 million, respectively. As of June 30, 1996, the Company had
an accumulated deficit of $47.9 million. The Company anticipates write-offs
during the three months ended September 30, 1996 associated with the closure of
its Texas operations and the resolution of the SpectraVision bankruptcy.
Operating results for the third quarter will also be impacted by operating
losses associated with the Texas operations and start-up costs associated with
new facilities. Due to these and other factors affecting its business, the
Company expects to report a loss for the third quarter of 1996. There can be no
assurance that the Company will operate profitably in the future. Continued
losses could materially and adversely affect the Company's business and the
value of, and the market for, the Company's equity securities.
Future Capital Needs; Uncertainty of Additional Financing. The
Company's ability to maintain its current revenue base and to grow its business
is dependent on the availability of adequate capital. Without sufficient
capital, the Company's growth may be limited. During portions of 1995 and the
beginning of 1996, the Company was in default under its senior credit agreement
("Credit Agreement") and subordinated note agreements. While the Company
renegotiated such agreements and executed amendments to such agreements in April
of 1996, due to the impact of operating losses, the Lucent Note discussed below
and other factors, the Company is no longer in compliance with certain financial
covenants and other provisions of the Credit Agreement and subordinated note
agreements. The Company's noncompliance with the Credit Agreement and
subordinated note agreements constitutes an event of default which entitles the
lenders to accelerate the Company's obligations thereunder. The Company is
currently in discussions with its lenders regarding potential changes to, or
waivers of defaults under, such agreements. The failure of the Company to be in
compliance with the Credit Agreement and subordinated note agreements could have
a material adverse effect upon the Company. The terms of the senior credit
facility have resulted in a reduced borrowing base which will be further reduced
over the period ending March 1997. The Company is required to use a portion of
cash generated from operations, from sales of assets and from sales of equity
securities to further reduce its borrowing base under the Credit Agreement. As a
result, the Company currently has limited capital. In addition, the terms of the
Company's Credit Agreement and subordinated note agreements restrict the
Company's ability to incur additional indebtedness and could adversely affect
the Company's ability to obtain additional financing. General market conditions
and the Company's future performance (including its ability to generate profits
and positive cash flow) will also impact the Company's financial resources. The
failure of the Company to obtain additional capital when needed could have a
material adverse effect on the Company's business and future prospects. No
assurance can be given that the Company will be able to cure its defaults under
the Credit Agreement and subordinated note agreements, will not incur additional
defaults under such agreements, or that additional financing will be available
or, if available, will be on acceptable terms.
Dispute with Lucent Technologies. The Company acquired inventory
consisting of used telephones from Lucent Technologies ("Lucent"). In June 1996,
the Company executed a promissory note in the amount of $4.6 million payable on
September 15, 1996 in favor of Lucent, reflecting a portion of the amount
invoiced to the Company by Lucent. Due to the quality of the inventory and the
lack of availability of spare parts to effect repairs, the Company believes it
has claims against Lucent. The Company currently does not intend to pay the
Lucent Note. The failure to pay the Lucent Note on September 15, 1996
constitutes an event of default under the Company's senior credit facility and
may result in an event of default under the Company's subordinated note
agreements. If the Company is required to pay the Lucent Note in full, it would
have a material adverse effect on the Company's financial resources.
Risk of Excess and Unusable Inventory; Decreased Value of Assets. At
the end of 1995, inventory constituted approximately 27% of the Company's
assets. Any decrease in the demand for the Company's repair services could
result in a substantial portion of the Company's inventory becoming excess,
obsolete or otherwise unusable. During the last few years, the Company wrote
down a significant amount of inventory and a significant amount of other assets,
including receivables, securities and goodwill. Changes in the Company's
business, as well as the business of third parties, could adversely affect the
value of assets remaining on the Company's financial statements, possibly
resulting in additional write-offs. The existence, amounts and timing of any
such additional write-offs will be dependent upon various factors including,
without limitation, the volume and profitability of future operations, market
conditions as well as the operations of the above mentioned third parties. In
particular, due to a variety of factors that the Company is currently assessing,
the Company may write down a portion of the inventory purchased from Lucent and
will write down assets associated with the Texas operations and the
SpectraVision bankruptcy. In addition, the Company received 333,407 shares of
Common Stock of Pen Interconnect in connection with the sale of its InCirT
division which were valued at $5.40 per share. Recently, the trading price of
such shares has decreased substantially and there can be no assurance that the
Company will not be required to write down its investment with respect to such
shares in the future. There can be no assurance that the Company will not be
required to write down significant amounts of its inventory or other assets in
the future, which could have a material adverse effect on the Company's business
and results of operations.
Dependence on Key Customers. During the six months ended June 30, 1996,
BT, IBM, SpectraVision and Rank Xerox accounted for approximately 13%, 11%, 6%
and 6%, respectively, of continuing operations. During 1995, IBM and
SpectraVision significantly decreased orders for certain programs which
materially and adversely affected the Company and its results of operations.
SpectraVision is currently operating under Chapter 11 of the U.S. Bankruptcy
Code, and the Company ceased performing services for SpectraVision in August
1996. A significant portion of the Company's net sales attributable to IBM in
1995 were from discontinued operations, and, as such, the Company expects net
sales attributable to IBM to continue to account for a decreasing percentage of
the Company's net sales. Also, IBM has informed the Company that it has changed
its strategy for spare parts and, as a result, will not renew an agreement
(which accounted for approximately 8% of the Company's 1995 net sales from
continuing operations) with the Company for such services which expires in
September 1996. Although the Company will not provide spare parts under this
agreement after September 1996, the Company believes it will continue to provide
services to IBM under other programs. There can be no
3
<PAGE> 5
assurance that major customers of the Company will not terminate any or all of
their arrangements with the Company; significantly change, reduce or delay the
amount of services ordered from the Company; or significantly change the terms
upon which the Company and these customers do business. Any such termination,
change, reduction or delay could have a material adverse effect on the Company's
business.
Dependence on Customers in the Electronics Industry. The Company is
dependent upon the continued growth, viability and financial stability of its
customers and potential customers in the electronics industry, particularly the
computer industry. The computer industry has been characterized by rapid
technological change, compressed product life cycles and pricing and margin
pressures. Improvements in technology and quality of hardware products or other
factors may result in a reduced need for parts and systems repairs in the future
which may adversely affect the Company's business. The factors affecting
segments of the electronics industry in general, and the Company's OEM customers
in particular, could have an adverse effect on the Company's business. During
1995, several of the Company's customers experienced severe financial difficulty
resulting in significant losses to the Company as a result of write downs of
receivables and other assets. There can be no assurance that existing customers
or future customers will not experience financial difficulty, which could have a
material adverse effect on the Company's business.
Reliance on Short-Term Purchase Orders. The Company's customer
contracts are typically subject to termination on short notice at the customer's
discretion and purchase orders under such contracts typically only cover
services over a 90-day period. The termination of any material contracts or any
substantial decrease in the orders received from major customers could have a
material adverse effect on the Company's business.
Competition. The Company competes with the in-house repair centers of
OEMs and TPMs for repair services. There is no assurance that these entities
will choose to outsource their repair needs. In certain instances, these
entities compete directly with the Company for the services of unrelated OEMs
and TPMs. In addition to competing with OEMs and TPMs, the Company also competes
for depot repair business with a small number of independent organizations
similar in size to the Company and a large number of smaller companies. Many of
the companies with which the Company competes have significantly greater
financial resources than the Company. There can be no assurance that the Company
will be able to compete effectively in its target markets.
Management of Growth. The Company's growth has placed, and will
continue to place, a strain on the Company's managerial, operational and
financial resources. These resources may be further strained by the
geographically dispersed operations of the Company and the future addition of
acquired depots or businesses, if any. The Company's ability to manage growth
effectively will require it to continue to improve its operational, financial
and management information systems; to develop the management skills of its
managers and supervisors; and to train, motivate and effectively manage its
employees. The Company's failure to effectively manage growth, including
acquired operations, could have a material adverse effect on the Company's
business.
Expansion of International Sales. During the six month period ended
June 30, 1996, approximately 21% of the Company's business was in Europe and the
Company intends to continue to expand its European operations. There can be no
assurance that the Company will be able to successfully market, sell and deliver
its products and services in these markets. In addition to the uncertainty as to
the Company's ability to expand its international presence, there are certain
risks inherent in doing business on an international level, such as unexpected
changes in regulatory requirements, export restrictions, tariffs and other trade
barriers, difficulties in staffing and managing foreign operations, longer
payment cycles, problems in collecting accounts receivable, political
instability, fluctuations in currency exchange rates and potentially adverse tax
consequences, which could adversely impact the success of the Company's
international operations. There can be no assurance that one or more of such
factors will not have a material adverse effect on the Company's international
operations and, consequently, on the Company's business, operating results and
financial condition.
Dependence on Acquisition Strategy. Certain of the Company's repair
programs result in decreasing net sales as the installed base of the particular
products under such programs decreases over time. An important component of the
Company's strategy to maintain its revenue and to grow its business has been the
acquisition of repair programs and complementary businesses. Competition for
these types of transactions is likely to intensify. The Company's ability to
effect any significant transactions requiring capital will be limited by the
terms of the Company's senior credit facility. There can be no assurance that
the Company will be able to acquire additional repair programs or complementary
businesses or, if acquired, that such operations will prove to be profitable.
4
<PAGE> 6
Discontinued Operations; Change in Strategy. In September 1995, Cerplex
adopted a plan to discontinue its end-of-life programs, a line of business which
historically generated a significant percentage of the Company's total sales,
but which in recent years experienced declining sales. Net sales from
end-of-life programs declined from approximately $56 million in 1993 to $33
million in 1994 to $20 million in 1995. The net loss from discontinued
operations for the year ended December 31, 1995 was $17.4 million. There can be
no assurance that the Company will not incur additional losses from these
operations. In connection with discontinuing its end-of-life business, the
Company changed certain elements of its business strategy and is undergoing
changes in management and operations, is developing a direct sales force and
terminating the majority of its outside sales representatives, is reducing its
emphasis on inventory acquisitions and focusing on targeted customers in
specific industries. While the Company believes such changes will enhance the
Company's opportunities, there can be no assurance that such changes will
positively impact the Company's business and results of operations in the short
or long term.
Risk Associated with the Ability of Existing Stockholders to Control
the Company. As of June 30, 1996, the officers, directors, principal
stockholders and their affiliates owned approximately 52% of the outstanding
Common Stock. Although there are currently no voting agreements or similar
arrangements among such stockholders, if they were to act in concert, they would
be able to elect a majority of the Company's directors, to determine the outcome
of most corporate actions requiring stockholder approval and otherwise to
control the business affairs of the Company. In addition, the Board of Directors
of the Company has the authority under the Company's Restated Certificate of
Incorporation to issue shares of the Company's authorized Preferred Stock in one
or more series and to fix the rights, preferences, privileges and restrictions
granted to or imposed upon any unissued shares of Preferred Stock. The issuance
of Preferred Stock may adversely affect the voting and dividend rights, rights
upon liquidation and other rights of the holders of Common Stock. The issuance
of Preferred Stock and the control by existing stockholders, if they were to act
in concert, may have the effect of delaying, deferring or preventing a change in
control of the Company.
On June 11, 1996, the Company consummated a private placement of Series
B Stock. Holders of Series B Stock are entitled to receive dividends as may be
declared from time to time by the Board prior and in preference to payment of
any dividends to the holders of Common Stock. In the event of any liquidation,
dissolution or winding up of the Company or the merger or sale of the Company,
the holders of Series B Stock will be entitled to receive, prior and in
preference to any distribution to the holders of Common Stock, the amount of
$2,000 per share of Series B Stock plus all accrued or declared but unpaid
dividends. Additionally, the Series B Stock is convertible into Common Stock at
a rate equal to the lower of a 20% discount to the trading price of the Common
Stock or $5.07 per share. The conversion rights of the Series B Stock could have
a significant dilutive effect upon the holders of Common Stock.
Dependence on Key Personnel. The Company's continued success depends,
to a large extent, upon the efforts and abilities of key managerial employees,
particularly the Company's executive officers. Competition for qualified
management personnel in the industry is intense. The loss of services of certain
of these key employees could have a material adverse effect on the Company's
business.
No Assurance of Public Market for Common Stock; Possible Volatility of
Stock Price. Prior to the Company's initial public offering, there was no public
market for the Common Stock, and there can be no assurance that an active
trading market will be sustained. In early 1996, the Company was not in
compliance with Nasdaq National Market System's requirement of at least
$1,000,000 in net tangible assets. While the Company regained compliance with
such requirement during the second quarter, additional losses could cause the
Company to fail to comply with such requirement which could result in the loss
of listing on the National Market System. There can be no assurance that the
Company will be able to meet this or other requirements or maintain its listing
on Nasdaq's National Market System. In addition, the trading price of the Common
Stock has been, and in the future could be, subject to significant fluctuations
in response to variations in quarterly operating results, the gain or loss of
significant contracts, changes in management or new products or services by the
Company or its competitors, general trends in the industry and other events or
factors. In addition, the stock market has experienced extreme price and volume
fluctuations which have particularly affected the market price for many
companies in similar industries and which have often been unrelated to the
operating performance of these companies. These broad market fluctuations may
adversely affect the market price of the Company's Common Stock.
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<PAGE> 7
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of
Shares by the Selling Security Holders. See "Selling Security Holders."
SELLING SECURITY HOLDERS
The following table sets forth the number of shares of Common Stock
beneficially owned by each of the Selling Security Holders. Except as indicated
in the footnotes below, none of the Selling Security Holders has had a material
relationship with the Company within the past three years other than as a result
of the ownership of the Shares or other securities of the Company. Because the
Selling Security Holders may offer some, all, or none of the Shares which they
hold, or have the right to acquire, pursuant to the offering contemplated by
this Prospectus, and because there are currently no agreements, arrangements or
understandings with respect to the sale of any of the Shares, no estimate can be
given as to the amount of Shares that will be held by the Selling Security
Holders after completion of this offering. See "Plan of Distribution."
During the period the Registration Statement is in effect, each Selling
Security Holder shall be entitled to sell any and all of the Security Holder's
shares. The Company will prepare and file such amendments and supplements to the
registration statement as may be necessary in accordance with the rules and
regulations of the Securities Act to keep it effective until all of such shares
have been sold pursuant to the registration statement or until registration of
the shares is no longer required by reason of Rule 144 under the Securities Act
or other rules of similar effect.
The Company has agreed to bear certain expenses (other than broker
discounts and commissions, if any, and expenses of counsel and other advisors to
the Selling Security Holders) in connection with the registration of the Shares
by the Selling Security Holders.
The Shares offered by this Prospectus may be offered from time to time
by the Selling Security Holders named below:
<TABLE>
<CAPTION>
NUMBER OF
SHARES PERCENT OF NUMBER OF
BENEFICIALLY OUTSTANDING SHARES REGISTERED
SELLING SECURITY HOLDERS OWNED(1)(2)(3) SHARES(1)(3) FOR SALE HEREBY(2)
- ------------------------ -------------- ------------ ------------------
<S> <C> <C> <C>
Leo and Nicole Arnaboldi JTWROS(4)............ 2,000 * 2,000
Bessemer Venture Partners II, L.P............. 390,344 2.9% 390,344
BHF-Bank Aktiengelselschaft(5)................ 31,250 * 31,250
Perry H. Braun(4)............................. 800 * 800
Robert H. Buescher............................ 1,000 * 1,000
Canaan Venture Offshore Limited Partnership... 279,179 2.1% 279,179
C. Samantha Chen.............................. 300 * 300
Chestnut Pacific Ltd. Partners................ 36,095 * 36,095
Comerica Bank - California(5)................. 31,250 * 31,250
Common Fund Equity Fund....................... 21,499 * 21,499
Hoyt Davidson(4).............................. 3,000 * 3,000
Richard R. Davis.............................. 1,000 * 1,000
Richard C. Davis(6)(7)........................ 703,204 5.2% 703,204
Peter K. Deeks(4)............................. 3,000 * 3,000
David L. Dennis(4)............................ 2,667 * 2,667
Thomas S. DePre(4)............................ 2,000 * 2,000
Robert E. Diemar(4)........................... 1,500 * 1,500
DLJ Capital Corporation(8).................... 1,510,255 10.8% 131,830
Malcolm and Emily Fairbairn................... 19,724 * 19,724
Robert Finzi(9)............................... 33,500 * 3,500
Mark K. Gornley(4)............................ 3,000 * 3,000
John Hancock Mutual Life Insurance Company(10) 893,261 6.2% 893,261
Deepak Kamra.................................. 4,000 * 4,000
William A. Klein(7)(11)....................... 4,990,383 37.2% 4,760,383
Klein 1994 Charitable Remainder Trust(12)..... 50,000 * 50,000
The Klein Foundation(12)...................... 180,000 1.3% 180,000
Richard E. Kroon.............................. 5,200 * 5,200
Myron Kunin(13)............................... 972,642 7.2% 952,642
</TABLE>
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<TABLE>
<S> <C> <C> <C>
Mark Lanigan(4)................................... 2,133 * 2,133
N.V. Mahuma....................................... 11,440 * 11,440
Andrea Martin..................................... 1,972 * 1,972
Brian J. McLoughlin(4)............................ 1,300 * 1,300
Nintin T. Mehta................................... 39,448 * 39,448
Michael R. Nicolais(4)............................ 3,400 * 3,400
North Atlantic Smaller Companies Trust PLC(10).... 43,478 * 43,478
Peak Investment Limited Partnership............... 197,240 1.5% 197,240
Pleiadas Investment Partners...................... 59,172 * 59,172
Gautam A. Prakash................................. 666 * 666
Larry E. Reeder(14)............................... 5,200 * 5,200
John K. Rodakis................................... 667 * 667
Thomas F. Ruhm.................................... 266 * 266
Scorpion Offshore Investment Fund................. 310,653 2.3% 310,653
James T. Sington(4)............................... 1,600 * 1,600
Sprout Growth II, L.P.(15)........................ 1,294,603 9.3% 1,294,603
Standard Global Equity Partners L.P............... 73,571 * 73,571
Standard Pacific Capital Offshore Fund Ltd........ 30,967 * 30,967
Sumitomo Bank of California(5).................... 31,250 * 31,250
The Northwestern Mutual Life Insurance Company(10) 918,261 6.4% 918,261
The & Trust....................................... 20,316 * 20,316
Kenneth A. Tucker(4).............................. 3,000 * 3,000
Wells Fargo Bank, N.A.(16)........................ 31,250 * 31,250
Whitman Partners, L.P............................. 262,724 1.9% 262,724
Theodore J. Wisniewski(17)........................ 753,603 5.6% 753,603
---------- ----------
14,270,233 12,611,808
========== ==========
</TABLE>
- ---------------
* Less than 1% as of August 20, 1996.
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or
investment power with respect to securities. Shares of Common Stock
subject to options, warrants and shares of Series B Stock which are
currently exercisable or convertible or which will become exercisable
or convertible within sixty (60) days after August 20, 1996 are deemed
outstanding for computing beneficial ownership of the person holding
such option, warrant or share of Series B Stock, but are not
outstanding for computing the beneficial ownership of any other person
or entity. The shares of Series B Stock are currently convertible into
shares of Common Stock.
(2) The conversion rate for the Series B Stock fluctuates based on the
trading price of the Company's Common Stock. For the purposes of
computing the beneficial ownership of, and number of shares registered
for sale by, the holders of the Series B Stock, each share of Series B
Stock is assumed to be convertible into 197.2387 shares of Common
Stock.
(3) Information is as of August 20, 1996.
(4) Selling Security Holder is an employee, officer and/or affiliate of DLJ
Capital Corporation ("DLJCC") and purchased Series A Preferred Stock in
connection with the Company's private placement of Series A Preferred
Stock and subordinated notes on November 19, 1993 (the "1993 Private
Placement"), which stock was converted into Common Stock at the
Company's initial public offering. DLJCC's relationship with the
Company is disclosed in footnote (7) below.
(5) Selling Security Holder is a senior debt holder of the Company pursuant
to that certain Credit Agreement dated October 12, 1994, as amended.
(6) Selling Security Holder is President of International Operations and a
director of the Company.
(7) The Company subleases certain real property for its operations in
Irvine, California and in Newburgh, New York from WC Cartwright
Corporation, a California corporation ("WC Cartwright"). Messrs. Klein
and Davis and Ms. Carolyn Klein (the spouse of Mr. Klein) are officers,
directors and principal shareholders of WC Cartwright. In 1995, the
Company paid to WC Cartwright an aggregate of $785,000 in rent for use
of the real properties in California and New York.
(8) Selling Security Holder is a wholly-owned subsidiary of Donaldson,
Lufkin & Jenrette Incorporated ("DLJ"). Donaldson, Lufkin & Jenrette
Securities Corporation, which is also a wholly-owned subsidiary of DLJ,
served as an underwriter in the Company's initial public offering on
April 8, 1994 and the placement agent in the Company's 1993 Private
Placement.
(9) Selling Security Holder is a director of the Company; a Vice President
of the Sprout Group, a division of DLJCC; and a general partner of a
general partner of Sprout Growth II, L.P. ("Sprout Growth"). DLJCC is
the managing general partner of Sprout Growth. DLJCC's relationship
with the Company is disclosed in footnote (7).
7
<PAGE> 9
(10) Selling Security Holder is a subordinated debt holder of the Company
pursuant to that certain Note Purchase Agreement dated November 19,
1993, as amended.
(11) Selling Security Holder is the Company's Chairman of the Board.
(12) The trustees for this Selling Security Holder are William A. Klein
(whose relationship to the Company is disclosed in footnotes (7) and
(10)) and his wife, Carolyn Klein.
(13) Selling Security Holder is a director of the Company.
(14) Selling Security Holder is an employee and/or affiliate of the Sprout
Group, a division of DLJCC. DLJCC's relationship to the Company is
disclosed in footnote (7).
(15) DLJCC is the managing general partner of Selling Security Holder.
DLJCC's relationship to the Company is disclosed in footnote (7).
(16) Selling Security Holder is a senior debt holder and serves as
Administrative Agent to those lenders whose relationship to the Company
is described in footnote (5).
(17) Selling Security Holder is Senior Vice President Quality Engineering
for the Company.
PLAN OF DISTRIBUTION
The Shares offered hereby are being offered directly by the Selling
Security Holders. The Company will not receive any proceeds from the sale of any
of the Shares by the Selling Security Holders. The sale of the Shares may be
effected by the Selling Security Holders on the Nasdaq National Market or
otherwise at prices and at terms then prevailing or at prices related to the
then current market price, or in negotiated transactions. The Shares may be sold
by one or more of the following: (a) a block trade in which the broker or dealer
so engaged will attempt to sell the Shares as agent but may position and resell
a portion of the block as principal to facilitate the transaction; (b) purchases
by a broker or dealer as principal and resale by such broker or dealer for its
account pursuant to this Prospectus; (c) an exchange distribution in accordance
with the rules of such exchange; and (d) ordinary brokerage transactions and
transactions in which the broker solicits purchasers. In effecting sales,
brokers or dealers engaged by the Selling Security Holders may arrange for other
brokers or dealers to participate. Brokers or dealers will receive commissions
or discounts from the Selling Security Holders in amounts to be negotiated
immediately prior to the sale. In addition, any securities covered by this
Prospectus which qualify for sale pursuant to Rule 144 may be sold under Rule
144 rather than pursuant to this Prospectus. The Company has also agreed to bear
certain expenses in connection with the registration and sale of the Shares
offered hereby by the Selling Security Holders (other than broker discounts and
commissions).
The Selling Security Holders and any broker-dealers, agents or
underwriters that participate with the Selling Security Holders in the
distribution of the Shares may be deemed to be "underwriters" within the meaning
of Section 2(11) of the Securities Act, and any commissions received by them and
any profit on the resale of the Shares purchased by them may be deemed to be
underwriting commissions or discounts under the Securities Act.
Under applicable rules and regulations under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), any person engaged in the
distribution of the Shares may not simultaneously engage in market making
activities with respect to the Common Stock of the Company for a period of two
business days prior to the commencement of such distribution. In addition and
without limiting the foregoing, each Selling Security Holder will be subject to
applicable provisions of the Exchange Act and the rules and regulations
thereunder, including, without limitation, Rules 10b-6 and 10b-7, which
provisions may limit the timing of purchases and sales of shares of the
Company's Common Stock by the Selling Security Holders.
LEGAL MATTERS
The validity of the securities offered hereby will be passed upon for
the Company by Brobeck, Phleger & Harrison LLP, Newport Beach, California.
EXPERTS
The consolidated financial statements of The Cerplex Group, Inc. as of
December 31, 1995 and 1994, and for the years then ended, have been incorporated
by reference herein and in the registration statements in reliance upon the
report of KPMG Peat Marwick LLP, independent certified public accountants,
incorporated by reference herein, and upon the authority of said firm as experts
in accounting and auditing.
8
<PAGE> 10
AVAILABLE INFORMATION
The Company is subject to the reporting requirements of the Exchange Act,
and in accordance therewith files annual and quarterly reports, proxy statements
and other information with the Securities and Exchange Commission (the
"Commission"). Such reports, proxy statements and other information may be
inspected, and copies of such material may be obtained at prescribed rates, at
the Commission's Public Reference Section , Room 1024, 450 Fifth Street, N.W.,
Washington D.C. 20549, as well as at the Commission's Regional Offices at 7
World Trade Center, 13th Floor, New York, New York 10048, and Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661. The Commission
maintains a web site (http://www.sec.gov) which contains reports, proxy and
information statements and other information regarding registrants that file
electronically, such as Cerplex. The Common Stock of the Company is traded on
The Nasdaq National Market. Reports, proxy statements and other information
concerning the Company may be inspected at the National Association of
Securities Dealers, Inc. at 1735 K Street, N.W., Washington, D.C. 20006.
The Company has filed with the Commission a registration statement on Form
S-3 (herein, together with all amendments and exhibits referred to as the
"Registration Statement") under the Securities Act with respect to the Common
Stock offered hereby. This Prospectus does not contain all of the information
set forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. For further
information pertaining to the Company and the Shares, reference is made to the
Registration Statement and the exhibits thereto, which may be inspected without
charge at, and copies thereof may be obtained at prescribed rates from, the
Office of the Commission at 450 Fifth Street, N.W., Judiciary Plaza, Washington,
D.C. 20549.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission are hereby incorporated
by reference in this Prospectus: (i) the Annual Report of the Company on Form
10-K for the fiscal year ended December 31, 1995; (ii) the Quarterly Report of
the Company on Form 10-Q for the quarter ended March 31, 1996; (iii) the
Quarterly Report of the Company on Form 10-Q for the quarter ended June 30,
1996; (iv) the definitive Proxy Statement of the Company in connection with the
Annual Meeting of Security Holders held on August 22, 1996; (v) the Current
Report of the Company on Form 8-K dated April 8, 1996; (vi) the Current Report
of the Company on Form 8-K and 8-K/A dated May 24, 1996; (vii) the Current
Report of the Company on Form 8-K dated June 11, 1996; (viii) the Current Report
of the Company on Form 8-K dated September 24, 1996; and (ix) the Registration
Statement on Form 8-A filed with the Securities and Exchange Commission on March
9, 1994.
All reports and other documents subsequently filed by the Company pursuant
to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this
Prospectus and prior to the termination of this offering shall be deemed to be
incorporated by reference herein and to be a part hereof from the date of filing
of such reports and documents. Any statement incorporated herein shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent that
a statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of this
Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered, upon written or oral request of such person, a copy of
any or all of the foregoing documents incorporated herein by reference (other
than exhibits to such documents, unless such exhibits are specifically
incorporated by reference into such document). Requests for such documents
should be submitted in writing to James T. Schraith, President and Chief
Executive Officer, at The Cerplex Group, Inc., 1382 Bell Avenue, Tustin, CA
92780 or by telephone at (714) 258-5600.
9
<PAGE> 11
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the costs and expenses, other than
broker-dealer discounts and commissions, payable in connection with the sale and
distribution of the securities being registered. All amounts are estimated
except the Securities and Exchange Commission and NASD registration fees and the
Nasdaq Additional Listing Fee. All of the expenses below will be paid by the
Company.
ITEM
<TABLE>
<S> <C>
Registration Fee ........................................... $23,658
Printing and engraving expenses ............................ 2,000
Legal fees and expenses .................................... 20,000
Accounting fees and expenses ............................... 3,000
Transfer Agent and Registrar fees .......................... 2,000
Miscellaneous .............................................. 5,000
-------
Total .................................................. $55,658
=======
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Under Section 145 of the Delaware Law, the Company has broad powers to
indemnify its directors and officers against liabilities they may incur in such
capacities, including liabilities under the Securities Act. The Company's Bylaws
(the "Bylaws") provide that the Company shall indemnify its directors and
officers to the fullest extent permitted by law and requires the Company to
advance litigation expenses upon receipt by the Company of an undertaking by the
director or officer to repay such advances if it is ultimately determined that
the director is not entitled to indemnification. The Bylaws further provide that
rights conferred under such Bylaws shall not be deemed to be exclusive of any
other right such persons may have or acquire under any bylaw, agreement, vote of
stockholders or disinterested directors, or otherwise.
The Company's Certificate of Incorporation (the "Certificate of
Incorporation") provides that, pursuant to Delaware Law, its directors shall not
be liable for monetary damages for breach of the directors' fiduciary duty of
care to the Company and its stockholders. This provision in the Certificate of
Incorporation does not eliminate the duty of care, and in appropriate
circumstances equitable remedies such as injunctive or other forms of
non-monetary relief will remain available under Delaware Law. In addition, each
director will continue to be subject to liability for breach of the director's
duty of loyalty to the Company for acts or omissions not in good faith or
involving intentional misconduct, for knowing violations of law, for actions
leading to improper personal benefit to the director, and for payment of
dividends or approval of stock repurchases or redemptions that are unlawful
under Delaware Law. The provision also does not affect a directors'
responsibilities under any other law, such as the federal securities laws or
state or federal environmental laws. The Certificate of Incorporation further
provides that the Company shall indemnify its directors and officers to the
fullest extent permitted by law, and requires the Company to advance litigation
expenses in the case of stockholder derivative actions or other actions, against
an undertaking by the director to repay such advances if it is ultimately
determined that the director is not entitled to indemnification. The Certificate
of Incorporation also provides that rights conferred under such Certificate of
Incorporation shall not be deemed to be exclusive of any other right such
persons may have or acquire under any statute, the Certificate of Incorporation,
the Bylaws, agreement, vote of stockholders or disinterested directors, or
otherwise.
The Company has in place a directors' and officers' liability insurance
policy that, subject to the terms and conditions of the policy, insures the
directors and officers of the Company against losses arising from any wrongful
act (as defined by the policy) in his or her capacity as a director or officer.
The policy reimburses the Company for amounts which the Company lawfully
indemnifies or is required or permitted by law to indemnify its directors and
officers.
In addition, the Company has entered into agreements to indemnify its
directors and certain of its officers in addition to the indemnification
provided for in the Certificate of Incorporation and Bylaws. These agreements
will, among other things, indemnify the Company's directors and certain of its
officers for certain expenses (including attorneys' fees), judgments, fines and
settlement amounts incurred by such person in any action or
II-1
<PAGE> 12
proceeding, including any action by or in the right of the Company, on account
of services as a director or officer of the Company or as a director or officer
of any subsidiary of the Company, or as a director or officer of any other
company or enterprise that the person provides services to at the request of the
Company.
ITEM 16. EXHIBITS.
Exhibit No.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER TITLE METHOD OF FILING
- ------- ----- ----------------
<S> <C> <C>
2.1 Agreement of Merger dated as of August 30, Incorporated herein by reference to Exhibit
1993, by and among Cerplex Incorporated, 2.1 to the Company's Registration Statement
Diversified Manufacturing Services, Inc. on Form S-1 (File No. 33-75004) which was
("DMS"), EMServe, Inc. ("EMServe"), declared effective by the Commission on April
InCirT Technology Incorporated ("InCirT") 8, 1994.
and Testar, Inc. ("Testar").
2.2 Agreement and Plan of Merger dated Incorporated herein by reference to Exhibit
November 12, 1993, between The Cerplex 2.2 to the Company's Registration Statement
Group Subsidiary, Inc. and Registrant on Form S-1 (File No. 33-75004) which was
(conformed copy to original). declared effective by the Commission on April
8, 1994.
2.3 Certificate of Ownership and Merger of Incorporated herein by reference to Exhibit
Registrant with and into The Cerplex Group 2.3 to the Company's Registration Statement
Subsidiary, Inc. dated as of November 12, on Form S-1 (File No. 33-75004) which was
1993. declared effective by the Commission on April
8, 1994.
2.4 Asset Purchase Agreement effective Incorporated herein by reference to Exhibit
December 17, 1993 by and between Certech 2.4 to the Company's Registration Statement
Technology, Inc., a wholly-owned subsidiary on Form S-1 (File No. 33-75004) which was
of the Registrant ("Certech"), and declared effective by the Commission on April
Spectradyne, Inc. ("Spectradyne"). 8, 1994.
2.5 Purchase and Sale Agreement dated as of Incorporated herein by reference to Exhibit 2
July 29, 1994, by and among The Cerplex to the Form 8-K filed July 29, 1994.
Group, Inc., Cerplex Limited, BT Repair
Services Limited and British
Telecommunications plc.
2.6 Contract for repair, calibration and Incorporated herein by reference to Exhibit 10
warehousing of certain items of BT to the Form 8-K filed July 29, 1994.
Equipment dated as of July 29, 1994, among
The Cerplex Group and Cerplex Limited and
BT.
2.7 Formation and Contribution Agreement Incorporated herein by reference to Exhibit
effective December 1, 1994 by and among 2.7 to the Company's Annual Report on Form
Modcomp/Cerplex L.P., Modular Computer 10-K for the fiscal year ended January 1, 1995.
Systems, Inc., Cerplex Subsidiary, Inc. and
The Cerplex Group, Inc.
2.8 Stock Purchase Agreement dated as of June 29, Incorporated herein by reference to Exhibit
1995 by and among The Cerplex Group, Inc., 2.11 to the Company's Quarterly Report on Form
Tu Nguyen and Phuc Le. 10-Q for the quarter ended October 1, 1995.
</TABLE>
II-2
<PAGE> 13
<TABLE>
<S> <C> <C>
2.9 Letter Agreement dated April 5, 1995 by Incorporated herein by reference to Exhibit
and among Modular Computer Systems, Inc., 2.12 to the Company's Annual Report on Form
Modcomp Joint Venture, Inc., EG 10-K for the fiscal year ended December 31,
Aktiengesellschaft, the Company, Cerplex 1995.
Subsidiary, Inc. and Modcomp/Cerplex L.P.
2.10 Stock Purchase Agreement dated as of May 24, Incorporated herein by reference to Exhibit
1996, by and among The Cerplex Group, Inc., 2.10 to the Company's Current Report on
Cerplex Limited, Rank Xerox - The Document Form 8-K dated May 24, 1996.
Company SA and Rank Xerox Limited (conformed
copy to original).
2.11 Contract of Warranty dated as of May 24, Incorporated herein by reference to Exhibit
1996, by and among The Cerplex Group, Inc., 2.11 to the Company's Current Report on
Cerplex Limited, Rank Xerox - The Document Form 8-K dated May 24, 1996.
Company SA and Rank Xerox Limited (conformed
copy to original).
2.12 Supply and Services Agreement dated as of Incorporated herein by reference to Exhibit
May 24, 1996, by and among The Cerplex 2.12 to the Company's Current Report on
Group, Inc., Cerplex Limited, Rank Xerox Form 8-K dated May 24, 1996.
- The Document Company SA and Rank Xerox
Limited (conformed copy to original).
4.1 Registration Rights Agreement dated as of Incorporated herein by reference to Exhibit
November 19, 1993, by and among the 4.2 to the Company's Registration Statement
Registrant, the Investors listed on Schedule on Form S-1 (File No. 33-75004) which was
A thereto and the security holders of the declared effective by the Commission on April
Registrant listed on Schedule B thereto, 8, 1994.
together with Amendment No. 1.
4.2 Warrant Agreement dated as of November 19, Incorporated herein by reference to Exhibit
1993, by and among the Registrant, and the 4.4 to the Company's Registration Statement
purchasers listed in Annex I thereto. on Form S-1 (File No. 33-75004) which was
declared effective by the Commission on April
8, 1994.
4.3 Placement Agent Warrant Purchase Agreement Incorporated herein by reference to Exhibit
dated as of November 19, 1993, between the 4.5 to the Company's Registration Statement
Registrant and Donaldson, Lufkin & Jenrette on Form S-1 (File No. 33-75004) which was
Securities Corporation. declared effective by the Commission on April
8, 1994.
4.4 Observation Rights Agreement dated as of Incorporated herein by reference to Exhibit
November 19, 1993, between the Registrant 4.6 to the Company's Registration Statement
and certain stock purchasers. on Form S-1 (File No. 33-75004) which was
declared effective by the Commission on April
8, 1994.
4.5 Observation Rights Agreement dated as of Incorporated herein by reference to Exhibit
November 19, 1993, between the Registrant 4.7 to the Company's Registration Statement
and certain note purchasers. on Form S-1 (File No. 33-75004) which was
declared effective by the Commission on April
8, 1994.
</TABLE>
II-3
<PAGE> 14
<TABLE>
<S> <C> <C>
4.6 Note Purchase Agreement dated as of November Incorporated herein by reference to Exhibit
19, 1993, by and between the Registrant and 4.8 to the Company's Registration Statement
The Northwestern Mutual Life Insurance on Form S-1 (File No. 33-75004) which was
Company, John Hancock Mutual Life Insurance, declared effective by the Commission on April
Registrant and Bank of Scotland London 8, 1994.
Nominees Limited.
4.7 Amendment No. 2 to Registration Rights Incorporated herein by reference to Exhibit
Agreement dated as of April 6, 1994, by and 4.9 to the Company's Registration Statement
among the Registrant and certain of its on Form S-1 (File No. 33-75004) which was
Securities Holders. declared effective by the Commission on April
8, 1994.
4.8 Amendment to Note Purchase Agreement, dated Incorporated herein by reference to Exhibit
as of October 27, 1994, by and among the 4.10 to the Company's Annual Report on Form
Company, Northwestern Mutual Life Insurance 10-K for the fiscal year ended December 31,
Company, John Hancock Mutual Life Insurance 1995.
Company and North Atlantic Smaller Companies
Trust P.L.C. (collectively, the "Noteholders").
4.9 Waiver and Amendment Agreement dated April 15, Incorporated herein by reference to Exhibit
1996 by and among Company, The Northwestern 4.11 to the Company's Annual Report on
Mutual Life Insurance Company, John Hancock Form 10-K for the fiscal year ended
Mutual Life Insurance Company and North December 31, 1995.
Atlantic Smaller Companies Investment Trust
P.L.C.
4.10 Warrant Agreement dated as of April 15, 1996 Incorporated herein by reference to Exhibit
by and among Company, The Northwestern Mutual 4.12 to the Company's Annual Report on
Life Insurance Company, John Hancock Mutual Form 10-K for the fiscal year ended
Life Insurance Company and North Atlantic December 31, 1995.
Smaller Companies Investment Trust P.L.C.
4.11 First Amendment to Warrant Agreement dated Incorporated herein by reference to Exhibit
April 15, 1996 by and among Company and each 4.13 to the Company's Annual Report on
of the holders of warrants listed on Schedule Form 10-K for the fiscal year ended
A thereto, with respect to that certain December 31, 1995.
Warrant Agreement dated November 19, 1993.
4.12 First Amendment to Observation Rights Incorporated herein by reference to Exhibit
Agreement dated as of April 15, 1996 4.14 to the Company's Annual Report on
between Company and certain note Form 10-K for the fiscal year ended
purchasers. December 31, 1995.
4.13 Third Amendment to Registration Rights Incorporated herein by reference to Exhibit
Agreement dated as of April 15, 1996 by and 4.15 to the Company's Annual Report on
among Company, the investors of Company Form 10-K for the fiscal year ended
listed on Schedule A thereto and the security December 31, 1995.
holders of Company listed on Schedule B
thereto.
</TABLE>
II-4
<PAGE> 15
<TABLE>
<S> <C> <C>
4.14 Warrant Agreement dated April 15, 1996 by Incorporated herein by reference to Exhibit
and among Company, Wells Fargo Bank, 4.16 to the Company's Annual Report on
National Association, Sumitomo Bank of Form 10-K for the fiscal year ended
California, BHF Bank Aktiengesellschaft and December 31, 1995.
Comerica Bank-California.
4.15 Stock Purchase Agreement dated June 10, Incorporated herein by reference to Exhibit
1996 by and among the Company and the 4.17 to the Company's Quarterly Report on
investors listed on Schedule A thereto. Form 10-Q filed August 14, 1996.
4.16 Fourth Amendment to Registration Rights Incorporated herein by reference to Exhibit
Agreement dated June 10, 1996 by and 4.18 to the Company's Quarterly Report on
among Company, the investors listed on Form 10-Q filed August 14, 1996.
Schedule A thereto, the security holders of
Company listed on Schedule B thereto, the
banks listed on Schedule C thereto and each
of the parties listed on Schedule D thereto.
4.17 Certificate of Designation of Preferences of Incorporated herein by reference to Exhibit
Series B Preferred Stock of The Cerplex 3.3 to the Company's Quarterly Report on
Group, Inc. Form 10-Q filed August 14, 1996.
5.1 Opinion of Brobeck, Phleger & Harrison Filed herein.
LLP.
23.1 Consent of KPMG Peat Marwick LLP. Filed herein.
23.2 Consent of Brobeck, Phleger & Harrison Included in the Opinion of Counsel filed as
LLP. Exhibit 5.1 hereto.
24.1 Power of Attorney. Included on p. II-7 of this Registration
Statement.
</TABLE>
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by section 10(a)(3) of
the Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the Registration
Statement. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total 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 Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent 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; provided,
however, that (i) and (ii) do not apply if the Registration Statement is on Form
S-3, Form S-8 or Form F-3, and the information required to be included in a
post-effective amendment by (i) and (ii) is contained in periodic reports filed
with or furnished to the Commission pursuant to Section 13 or Section 15(d) of
the Exchange Act that are incorporated by reference in the Registration
Statement.
II-5
<PAGE> 16
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-6
<PAGE> 17
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Tustin, State of California, on September 24, 1996.
THE CERPLEX GROUP, INC.
By /s/ JAMES T. SCHRAITH
-------------------------
James T. Schraith
President and Chief
Executive Officer
POWER OF ATTORNEY
We, the undersigned officers and directors of The Cerplex Group, Inc., do
hereby constitute and appoint James T. Schraith and James R. Eckstaedt our true
and lawful attorney-in-fact and agent, each with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said 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, ratifying and confirming all that each of
said attorney-in-fact and agent, or his substitute or substitutes, may lawfully
do or cause to be done by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT, THIS REGISTRATION
STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE CAPACITIES AND ON THE
DATES INDICATED.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ WILLIAM A. KLEIN Chairman of the Board September 24, 1996
- ------------------------
William A. Klein
/s/ JAMES T. SCHRAITH President, Chief Executive September 24, 1996
- ------------------------ Officer and Director
James T. Schraith
/s/ RICHARD C. DAVIS President of International September 24, 1996
- ------------------------ Operations and Director
Richard C. Davis
/s/ JAMES R. ECKSTAEDT Senior Vice President and Chief September 24, 1996
- ------------------------ Financial Officer (Principal
James R. Eckstaedt Accounting Officer)
/s/ ROBERT FINZI Director September 24, 1996
- ------------------------
Robert Finzi
/s/ JEROME JACOBSON Director September 24, 1996
- ------------------------
Jerome Jacobson
/s/ PATRICK S. JONES Director September 24, 1996
- ------------------------
Patrick S. Jones
/s/ MYRON KUNIN Director September 24, 1996
- ------------------------
Myron Kunin
II-7
<PAGE> 18
THE CERPLEX GROUP, INC.
INDEX TO EXHIBITS
Sequentially
Numbered
Exhibit Description Page
- ------- ----------- ------------
5.1 Opinion of Brobeck, Phleger & Harrison LLP........
23.1 Consent of KPMG Peat Marwick LLP..................
23.2 Consent of Brobeck, Phleger & Harrison LLP
(Included in the Opinion of Counsel filed
as Exhibit 5.1 hereto)............................
24.1 Power of Attorney (Included on page II-7
of this Registration Statement)...................
II-8
<PAGE> 1
EXHIBIT 5.1
September 24, 1996
The Cerplex Group, Inc.
1382 Bell Avenue
Tustin, California 92780
Ladies and Gentlemen:
We have acted as counsel to The Cerplex Group, Inc. (the
"Company"), a California corporation, in connection with its registration of
12,611,808 shares of Common Stock (the "Common Stock") as described in the
Company's Registration Statement on Form S-3, filed with the Securities and
Exchange Commission under the Securities Act of 1933, as amended (the
"Registration Statement").
It is our opinion that the Common Stock, when sold in
accordance with the Registration Statement, will be validly issued, fully paid
and nonassessable.
We consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement and to the reference to this firm under the caption
"Legal Matters" in the Prospectus which is part of the Registration Statement.
Very truly yours,
BROBECK, PHLEGER & HARRISON LLP
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
The Cerplex Group, Inc.:
We consent to the use of our report incorporated herein by reference and to the
reference to our firm under the heading "Experts" in the prospectus.
KPMG PEAT MARWICK LLP
Orange County, California
September 24, 1996
