<PAGE> 1
As filed with the Securities and Exchange Commission on October 15, 1997
Registration No. 333-28425
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
AMENDMENT NO. 2
TO
FORM S-2
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)
STEPHEN J. HOPKINS
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 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, check the following box. [x]
If the registrant elects to deliver its latest annual report to security
holders, or a complete and legible facsimile thereof, pursuant to Item 11(a)(1)
of this form, 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, 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. [ ]
----------------------
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, as amended (the "1933 Act"), or until the
Registration Statement shall become effective on such date as the Commission,
acting pursuant to said Section 8(a), may determine.
Pursuant to Rule 429 of the 1933 Act, the prospectus contained herein
is a combined prospectus which relates to the Company's Registration Statement
on Form S-3 (Registration No. 333-12581) filed with the Securities and Exchange
Commission on September 24, 1996 and includes the 12,611,808 shares registered
thereunder.
<PAGE> 2
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
PROSPECTUS THE CERPLEX GROUP, INC.
37,112,579 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 37,112,579 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 Over-The-Counter Bulletin Board 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 Over-The-Counter Bulletin
Board under the symbol "CPLX." On October 13, 1997, the last reported bid price
of the Company's Common Stock on the Over-The-Counter Bulletin Board was $0.26
per share.
THE DATE OF THIS PROSPECTUS IS OCTOBER 15, 1997.
<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 a leading provider of service outsourcing to the high
technology industry. The Company's core capabilities are electronic parts
repair, spare parts sales and management and value added logistics management.
The Company has developed specialized competencies in these areas, focusing on
computer and peripheral, office automation and telecommunication markets.
Primary services include product repair, remanufacturing and reutilization,
parts sales, guaranteed availability and advanced exchange, returns processing,
and materials management. The Company's network of facilities in the U.S. and
Europe enables it to support the diverse service needs of its global customers.
In the computer marketplace, the Company primarily services display
terminals, printed circuit boards, laptops, inter-networking equipment,
workstations, mass storage devices and power supplies. In the office
automation marketplace, the Company services printers, scanners, fax machines,
and high value products such as copiers, automatic transfer machines, and other
paper-handling equipment. In the telecommunication marketplace, the Company
primarily services simple and complex switching systems, pay phones, video
conferencing products, multiplexers, mobile communications, transmission
equipment, hubs and modems.
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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RISK FACTORS
This Prospectus may contain forward-looking statements which involve risks
and uncertainties. Actual results could differ materially from those discussed
in 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, 1997, the Company reported a net loss of $14.4 million, including an
operating loss of $14.9 million. As of June 30, 1997, the Company had an
accumulated deficit of $88.8 million. There can be no assurance that the
Company will reduce its operating losses or 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.
Dependence on Key Customers. During 1996, Rank Xerox, IBM, BT and
Digital Equipment Corporation accounted for approximately 17%, 12%, 11% and 4%
of revenues, respectively. In the six month period ended June 30, 1997, these
customers accounted for approximately 30%, 6%, 10% and 10% of revenues,
respectively. During 1995 and 1996, IBM significantly decreased orders for
certain programs which materially and adversely affected the Company and its
results of operations. 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. During the first half of
1997, sales to IBM decreased 68% from the first half of 1996. Sales to BT
significantly decreased during 1996 to approximately $21.4 million representing
a 36% decrease from 1995. During the first half of 1997, sales to BT decreased
29% from the first half of 1996. There can be no 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.
Future Capital Needs and Going Concern; 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 and its
existing operations may be adversely affected. The Company's financial
condition and limited capital has adversely impacted the Company's relationship
with certain customers and may adversely impact its relationship with customers
in the future. During portions of 1996 and 1997, the Company was in default
under its senior credit agreement and subordinated note purchase agreements.
The Company has renegotiated amendments to its senior credit agreement and to
its subordinated note purchase agreements. The terms of the senior credit
agreement, as amended, provide for a limited borrowing base which will be
further reduced through and will expire in, May 1998. The Company is required
to use a portion of cash generated from operations, and from sales of assets to
further reduce its borrowing base under the senior credit agreement. The
interest rate payable by the Company has increased significantly and is subject
to significant further increases because the Company has not repaid the senior
credit agreement in full by September 30, 1997. The terms of the subordinated
note purchase agreements have been amended to provide for an increase in the
applicable interest rate from 9.5% to 15%. In addition, the terms of the
senior credit agreement and the subordinated note purchase 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. The Company is required to maintain or fulfill certain
covenants and obligations in order to maintain its senior credit facility and
to be incompliance under its subordinated note purchase agreements. No
assurance can be given that the Company will be able to fulfill such
obligations and covenants or to otherwise maintain its senior credit facility
or subordinated note purchase agreements. In addition, the covenants under the
subordinated note purchase agreements as currently cast will be significantly
more restrictive as of June 1998. No assurance can be given that additional
financing will be available or, if available, will be on acceptable terms.
Therefore, the Company believes that it will be in default again under such
agreements at that time unless it is able to successfully renegotiate the
covenants.
Impact of Series B Preferred Stock. In June 1996, the Company issued
8,000 shares of Series B Preferred Stock at $1,000 per share in a private
placement. The Series B Preferred Stock is convertible into Common Stock of
the Company at the option of each holder at the lower of $5.07 per share or 80%
of the average closing bid price over a ten-day period ending three days prior
to the date of conversion. The Series B Preferred Stock has certain rights,
privileges and preferences, including preferential voting rights and a $2,000
per share preference in the event of a sale of the Company. The Board of
Directors may not pay dividends to the holders of the Company's Common
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Stock unless and until the Board has paid an equivalent dividend to the holders
of Series B Preferred Stock based upon the number of shares of Common Stock
into which each share of Series B Preferred Stock is convertible. As of
September 30, 1997, 7,621 shares of the Series B Preferred Stock had been
converted into approximately 21,387,207 shares of Common Stock. Due in part to
the decreases in the trading price of the Company's Common Stock, the
conversion rights of the Series B Preferred Stock have resulted in, and may in
the future result in, dilution to the holders of Common Stock.
Dispute with Lucent Technologies. The Company acquired inventory
consisting of used telephones from Lucent. At December 31, 1996, the Company
had $5.9 million of inventory, production cost commitments and assets, related
to the telephones acquired from Lucent, which were subsequently sold to a
Company that specializes in worldwide corporate bartering. In June 1996, the
Company executed a promissory note bearing interest at 9.75% 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. Lucent has invoiced
the Company for an additional $0.6 million. 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 or other Lucent invoices. If the Company is
required to pay the Lucent note and other Lucent invoices in full, it would
have a material adverse effect on the Company's financial resources. On
October 7, 1996, the Company filed a lawsuit against Lucent in the Orange
County Superior Court seeking to have the Lucent note declared invalid. On
November 6, 1996, Lucent filed a cross-complaint seeking payment of the Lucent
Note, alleging damages for breach of contract and seeking a constructive trust
on any proceeds from the sale of the telephones. The Company's failure to have
the Lucent note declared invalid, or the loss to Lucent of any of the material
claims asserted by the Company, could materially and adversely affect the
Company.
Risk of Excess and Unusable Inventory; Decreased Value of Assets. At
June 30, 1997, inventory constituted approximately 11% of the Company's assets.
Any decrease in the demand for the Company's repair services could result in an
additional 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. The Company wrote down $1.6
million in goodwill in the second quarter of 1997 mainly due to continued
declining sales of its Leeds, England and Redmond, Washington operations.
Changes in the Company's business, as well as the business of third parties,
could adversely affect the value of assets remaining, possibly resulting in
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
addition, the Company became entitled to receive an aggregate of approximately
370,000 shares of Common Stock of Pen Interconnect, Inc. in connection with the
sale of its InCirT division which were valued at $5.40 per share. The trading
price of such shares has subsequently decreased substantially and the Company
wrote off $1.1 million in the fourth quarter of 1996 and $500,000 in the second
quarter of 1997. In October 1996, the Company entered into an agreement to
sell its phone inventory purchased from Lucent to Atwood Richards, Inc.
("ARI"). The consideration paid to the Company from ARI was up to $7.5 million
in trade credits. The Company has no prior experience in using trade credits
and there can be no assurance the Company will realize the value of the trade
credits. The Company wrote down the book value of the trade credits to $3
million in the fourth quarter of 1996 and to $2 million in the second quarter
of 1997. 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 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. 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 and 1996, 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.
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<PAGE> 6
Competition. The Company competes with the in-house repair centers of
original equipment manufacturers ("OEM") and third party maintainers ("TPM")
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 OEM and TPM. In
addition to competing with OEM and TPM, 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.
Expansion of International Sales. During the six months ended June
30, 1997, approximately 64% of the Company's sales were international. During
1996, approximately 41% of the Company's sales were international. 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 transactions requiring capital will be limited
by the Company's lack of working capital and by the terms of the Company's
senior credit facility and subordinated notes. The Company is no longer
permitted under the terms of its credit facility to engage in acquisitions.
There can be no assurance that the Company will be able to acquire additional
repair programs or complementary businesses in the future or, if acquired, that
such operations will prove to be profitable.
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 experienced declining sales. Net sales from end-of-life
programs declined from approximately $33 million in 1994 to $20 million in 1995
and further declined to $9.2 million in 1996. Sales from the end-of-life
program during 1997 were not material. 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 is
focusing on targeted customers in specific industries. 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 September 30, 1997, the officers, directors, principal
stockholders and their affiliates owned greater than a majority 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, determine
the outcome of most corporate actions requiring stockholder approval and
otherwise control the business affairs of the Company. 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. In April 1997,
William A. Klein acquired 3,663,898 shares of Common Stock upon the conversion
of Series B Preferred Stock, Richard C. Davis acquired 166,667 shares of
Common Stock upon the conversion of Series B Preferred Stock and the Sprout
Growth, II L.P. acquired 7,563,333 shares of Common Stock upon the conversion
of Series B Preferred Stock. In addition, DLJ Capital Corporation converted
231 shares of Preferred Stock into 770,000 shares of Common Stock.
Dependence on Key Personnel. The Company's future success depends, to
a large extent, upon the efforts and abilities of key employees. Competition
for qualified personnel in the industry is intense. The loss of services
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of certain of these key employees could have a material adverse effect on the
Company's business. During the last year, the Company has lost the services of
several of its key executive officers and members of management. While the
Company has filled several positions, including hiring a new Chief Executive
Officer, Stephen J. Hopkins, the Company is currently searching for certain
other key managers.
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. On February 20, 1997, the Company was
removed from the NASDAQ National Market System and commenced trading on the OTC
Bulletin Board. There can be no assurance of an active trading market for the
Company's Common Stock. 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.
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 such Selling
Security Holder's Shares. 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
------------------------ -------------- -------------- ---------------
<S> <C> <C> <C>
Leo and Nicole Arnaboldi JTWROS(4) . . . . . . . 2,000 * 2,000
Bessemer Venture Partners II, L.P. . . . . . . . 390,344 1.12% 390,344
Perry H. Braun(4) . . . . . . . . . . . . . . . . 800 * 800
Robert H. Buescher . . . . . . . . . . . . . . . 1,000 * 1,000
Canaan Venture Offshore Limited Partnership . . . 279,179 * 279,179
C. Samantha Chen . . . . . . . . . . . . . . . . 300 * 300
Chestnut Pacific Ltd. Partners . . . . . . . . . 287,685 * 287,685
Citibank, N.A.(5) . . . . . . . . . . . . . . . . 2,137,188 5.78% 2,137,188(6)(8)
Common Fund Equity Fund . . . . . . . . . . . . . 115,984 * 115,984
Hoyt Davidson(4) . . . . . . . . . . . . . . . . 3,000 * 3,000
Richard R. Davis . . . . . . . . . . . . . . . . 1,000 * 1,000
Richard C. Davis(9)(10) . . . . . . . . . . . . . 845,871 2.43% 845,871
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
</TABLE>
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<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
------------------------ -------------- -------------- ---------------
<S> <C> <C> <C>
DLJ Capital Corporation(11) . . . . . . . . . . . 9,360,492 26.82% 856,268 (6)
Malcolm and Emily Fairbairn . . . . . . . . . . . 112,458 * 112,458
Robert Finzi(12) . . . . . . . . . . . . . . . . 43,500 * 3,500
Mark K. Gornley(4) . . . . . . . . . . . . . . . 3,000 * 3,000
John Hancock Mutual Life Insurance Company(13) . 1,132,437 3.15% 1,132,437 (6)
Deepak Kamra . . . . . . . . . . . . . . . . . . 4,000 * 4,000
William A. Klein(10)(14) . . . . . . . . . . . . 8,654,281 24.84% 4,760,383
Klein 1994 Charitable Remainder Trust . . . . . . 1,271,299 3.65% 1,271,299 (15)
The Klein Foundation(16) . . . . . . . . . . . . 180,000 * 180,000
Klein Investments Family Limited Partnership . . 2,442,599 7.01% 2,442,599 (17)
Richard E. Kroon . . . . . . . . . . . . . . . . 5,200 * 5,200
Myron Kunin(18) . . . . . . . . . . . . . . . . . 982,642 2.82% 952,642
Mark Lanigan(4) . . . . . . . . . . . . . . . . . 2,133 * 2,133
N.V. Mahuma . . . . . . . . . . . . . . . . . . . 60,104 * 60,104
Andrea Martin . . . . . . . . . . . . . . . . . . 10,000 * 10,000
Brian J. McLoughlin(4) . . . . . . . . . . . . . 1,300 * 1,300
Nintin T. Mehta . . . . . . . . . . . . . . . . . 666,667 1.91% 666,667
Michael R. Nicolais(4) . . . . . . . . . . . . . 3,400 * 3,400
North Atlantic Smaller Companies Trust PLC(14) . 65,222 * 65,222 (6)
Peak Investment Limited Partnership . . . . . . . 2,176,030 6.24% 2,176,030
Pleiades Investment Partners . . . . . . . . . . 791,237 2.27% 791,237
Gautam A. Prakash . . . . . . . . . . . . . . . . 666 * 666
Larry E. Reeder(19) . . . . . . . . . . . . . . . 5,200 * 5,200
John K. Rodakis . . . . . . . . . . . . . . . . . 667 * 667
Thomas F. Ruhm . . . . . . . . . . . . . . . . . 266 * 266
Scorpion Offshore Investment Fund(7) . . . . . . 1,700,963 4.88% 1,700,963
James T. Sington(4) . . . . . . . . . . . . . . . 1,600 * 1,600
Sprout Growth II, L.P.(20) . . . . . . . . . . . 8,410,398 24.10% 8,410,401
Standard Global Equity Partners L.P.(7) . . . . . 788,754 2.26% 788,754
Standard Pacific Capital Offshore Fund Ltd.(7) . 312,212 * 312,212
The Northwestern Mutual Life Insurance Company(14) 1,157,437 3.21% 1,157,437 (6)
The & Trust . . . . . . . . . . . . . . . . . . . 110,536 * 110,536
Kenneth A. Tucker(4) . . . . . . . . . . . . . . 3,000 * 3,000
Whitman Partners, L.P. . . . . . . . . . . . . . 3,285,373 9.43% 3,285,373
Theodore J. Wisniewski . . . . . . . . . . . . . 841,384 2.41% 841,384
Unallocated Shares(21) . . . . . . . . . . . . . 920,723
============== ============
48,659,975 37,112,579
</TABLE>
* Less than 1% as of August 29, 1997.
(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. Except as otherwise
indicated, shares of Common Stock subject to options, warrants and
shares of Series B Preferred Stock which are currently exercisable or
convertible or which will become exercisable or convertible within
sixty (60) days after August 29, 1997 are deemed outstanding for
computing beneficial ownership of the person holding such option,
warrant or share of Series B Preferred Stock, but are not outstanding
for computing the beneficial ownership of any other person or entity.
The shares of Series B Preferred Stock are currently convertible into
shares of Common Stock.
(2) The conversion rate for the Series B Preferred 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 Preferred Stock,
each outstanding share of Series B Preferred Stock is assumed to be
convertible into 3,289 shares of Common Stock.
(3) Information is as of August 29, 1997.
(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 (11) 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.
7
<PAGE> 9
(6) Includes the resale of Common Stock issuable upon the exercise of
outstanding warrants. 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 the application of the antidilution
provisions of the outstanding warrants.
(7) Selling Security Holder is a holder of outstanding shares of Series B
Preferred Stock.
(8) Includes a warrant to purchase 31,250 shares of Common Stock
transferred to Selling Security Holder by Sumitomo Bank of California,
a warrant to purchase 31,250 shares of Common Stock transferred to
Selling Security Holder by Comerica Bank-California, a warrant to
purchase 218,750 shares of Common Stock transferred to Selling
Security Holder by BHF-Bank Aktiengelselschaft and a warrant to
purchase 218,750 shares of Common Stock transferred to Selling
Security Holder by Wells Fargo Bank, N.A.
(9) Selling Security Holder is President of International Operations and a
director of the Company.
(10) 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.
(11) 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.
(12) 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 (11).
(13) Selling Security Holder is a subordinated debt holder of the Company
pursuant to that certain Note Purchase Agreement dated November 19,
1993, as amended.
(14) Selling Security Holder is the Company's Chairman of the Board.
(15) Consists of the shares of Common Stock issued to selling Security
Holder upon the conversion of 427, 32, 25 and 16 shares of Series B
Preferred Stock transferred to Selling Security Holder by Scorpion
Offshore Investment Fund, Common Fund Equity Fund, Chestnut Pacific
Ltd. Partners and The & Trust, respectively. The trustees for this
Selling Security Holder are William A. Klein (whose relationship to
the Company is disclosed in footnotes (10) and (14)) and his wife,
Carolyn Klein.
(16) The trustees for this Selling Security Holder are William A. Klein
(whose relationship to the Company is disclosed in footnotes (10) and
(14)) and his wife, Carolyn Klein.
(17) Consists of the shares of Common Stock issued to Selling Security
Holder upon the conversion of the 250 shares of Series B Preferred
Stock transferred to Selling Security Holder by Whitman Partners, L.P.
The trustees for this Selling Security Holder are William A. Klein
(whose relationship to the Company is disclosed in footnotes (10) and
(14)) and his wife, Carolyn Klein.
(18) Selling Security Holder is a director of the Company.
(19) 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 (11).
(20) DLJCC is the managing general partner of Selling Security Holder.
DLJCC's relationship to the Company is disclosed in footnote (11).
(21) These shares are registered hereunder but have not been allocated to a
specific Selling Security Holder.
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 Over-The-Counter Bulletin
Board 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).
8
<PAGE> 10
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.
LIQUIDITY AND CAPITAL RESOURCES
Subordinated Notes. On August 20, 1997, the Company completed an
amendment to its subordinated note purchase agreements which revised certain
covenants, provided for the issuance to the subordinated note holders of
warrants to purchase an aggregate of 500,096 shares of the Company's Common
Stock at $0.59 per share (the "New Subdebt Warrants"), and increased the
interest rate on the Series A Notes from 9.5% to 15%. The amendment also
provided that increased interest may be paid in lieu of cash in the form of
additional subordinated notes carrying the same terms as the Series A Notes.
However, on or before August 19, 1998, the Company may elect to prepay the
principal and all accrued and unpaid interest at a rate of 9.5% per annum on
all outstanding Series A notes and such payments shall be deemed to satisfy all
of the Company's obligations in respect of the Series A notes. In addition, if
the Company prepays the Series A notes as described, the New Subdebt Warrants
shall be cancelled. While the August amendment to the subordinated note
purchase agreements cured the Company's existing defaults under the
subordinated note purchase agreements, the covenants under the subordinated
note agreements as currently cast, will be significantly more restrictive as of
June 1998. Therefore, the Company believes that it will be in default again
under such agreements at that time unless it is able to successfully
renegotiate the covenants.
Miscellaneous. On August 27, 1997, the Company consummated
the sale of all of the assets of Modcomp to CSP, Inc., a Massachusetts
corporation, for a purchase price of $8,540,000, of which approximately
$8,447,000 was paid in cash at the closing. The remaining $95,000 of the
purchase price was withheld from payment pursuant to an escrow agreement
between the parties pending the determination of certain tax liabilities of
Modcomp. The net proceeds to the Company were $8,102,000, which were used to
repay the term loan and revolver under the Company's senior credit facility,
leaving approximately $2,000,000 available under the revolver, all of which has
been drawn down.
9
<PAGE> 11
DESCRIPTION OF CAPITAL STOCK
GENERAL
The authorized capital stock of the Company consists of (i) 3,059,147
shares of Preferred Stock, $.001 par value ("Preferred Stock"), of which 807
shares are outstanding Series B Preferred Stock, and (ii) 60,000,000 shares of
Common Stock, $.001 par value (the "Common Stock").
COMMON STOCK
Holders of Common Stock are entitled to one vote per share on all
matters to be voted upon by the stockholders. Shares of Common Stock do not
have cumulative voting rights with respect to the election of directors.
Subject to preferences that may be applicable to the holders of
outstanding shares of Series B Preferred Stock, if any, the holders of Common
Stock are entitled to receive such lawful dividends as may be declared by the
Board of Directors. In the event of liquidation, dissolution or winding up of
the Company, and subject to the rights of the holders of outstanding shares of
Series B Preferred Stock, if any, the holders of shares of Common Stock shall
be entitled to receive pro rata all of the remaining assets of the Company
available for distribution to its shareholders.
There are no redemption or sinking fund provisions applicable to the
Common Stock. All outstanding shares of Common Stock are fully paid and
nonassessable, and shares of Common Stock to be issued pursuant to the Offering
shall be fully paid and nonassessable. The shares of Common Stock are not
convertible into any other series or class of the Company's securities.
Holders of Common Stock do not have any preemptive rights or rights to
subscribe for additional securities of the Company.
PREFERRED STOCK
The Preferred Stock authorized by the Company's Restated Certificate
of Incorporation may be issued from time to time in one or more series. The
Board of Directors of the Company is authorized to fix or alter the rights,
preferences, privileges and restrictions granted to or imposed upon additional
series of Preferred Stock and the number of shares constituting any such series
and the designation thereof, or of any of them. Subject to compliance with
applicable protective voting rights which have been or may be granted to the
Preferred Stock or series thereof in Certificates of Determination or the
Company's Restated Certificate of Incorporation, but notwithstanding any other
rights of the Preferred Stock or any series thereof, the rights, privileges,
preferences and restrictions of any such additional series may be subordinated
to, pari passu, with (including, without limitation, inclusion in provisions
with respect to liquidation and acquisition preferences, redemption and/or
approval of matters by vote or written consent), or senior to any of those of
any present or future class or series of Preferred or Common Stock.
SERIES B PREFERRED STOCK
Holders of the Series B Preferred Stock are entitled to receive
dividends as may be declared from time to time by the Board. The Board may not
pay dividends to the holders of the Company's Common Stock unless and until the
Board has paid an equivalent dividend, based upon the number of shares of
Common Stock into which each share of Series B Preferred Stock is convertible
as of the record date for the payment of the dividend, to the holders of Series
B Preferred Stock.
In the event of any liquidation, dissolution or winding up of the
Company, the holders of Series B Preferred Stock are entitled to receive, prior
and in preference to any distribution of any assets of the Company to the
holders of Common Stock, the amount of $2,000 per share plus all accrued or
declared but unpaid dividends (the "Liquidation Preference").
At any time after September 9, 1996, each share of Series B Preferred
Stock may be converted, at the option of the holder thereof, into the number of
shares of Common Stock equal to $1,000 (the "Original Issue Price") divided by
the lower of (i) 80% of the average closing bid price of the Common Stock for
the 10 trading days ending three days prior to the date of the notice of
conversion or (ii) $5.07 (the "Conversion Price"). Each share of Series B
Preferred Stock shall automatically be converted into the number of shares of
Common Stock determined as provided above, either (i) June 11, 2001, or (ii)
five days after written notice to the holders of Series B Preferred Stock by
the Company that the price of the Common Stock for 30 consecutive trading days
has exceeded $19.13 per share, whichever occurs first. The conversion
provisions are also subject to adjustment in certain circumstances.
10
<PAGE> 12
The Series B Preferred Stock is not redeemable. Except as otherwise
provided by law, each holder of shares of Series B Preferred Stock shall be
entitled to vote with the holders of Common Stock on an as-converted basis,
assuming a conversion price of $5.40, as a single class on all matters
presented for stockholder vote.
CERTAIN PROVISIONS OF DELAWARE LAW
The Company is a Delaware corporation and is subject to Section 203 of
the Delaware General Corporation Law. In general, Section 203 prevents an
"interested stockholder" (defined generally as a person owning 15% or more of
the Company's outstanding voting stock) from engaging in a "business
combination" (as defined in Section 203 ) with the Company for three years
following the date that person became an interested stockholder unless: (i)
before that person became an interested stockholder, the Board of Directors
approved the transaction in which the interested stockholder became an
interested stockholder or approved the business combination; (ii) upon
completion of the transaction that resulted in the interested stockholder
becoming an interested stockholder, the interested stockholder owned at least
85% of the voting stock of the Company outstanding at the time the transaction
commenced (excluding stock held by directors who are also officers of the
Company and by employee stock plans that do not provide employees with the
right to determine confidentially whether shares held subject to the plan will
be tendered in a tender or exchange offer); or (iii) on or following the date
on which that person became an interested stockholder, the business combination
is approved by the Company's Board of Directors and authorized at a meeting of
stockholders by the affirmative vote of the holders of at least 66 2/3% of the
outstanding voting stock of the Company now owned by the interested
shareholder.
Under Section 203, these restrictions also do not apply to certain
business combinations proposed by an interested stockholder following the
announcement or notification of one of certain extraordinary transactions
involving the Company and a person who was not an interested stockholder during
the previous three years or who became an interested stockholder with the
approval of a majority of the Company's directors, if that extraordinary
transaction is approved or not opposed by a majority of the directors (but not
less than one) who were directors before any person became an interested
stockholder in the previous three years or who were recommended for election or
elected to succeed such directors by a majority of such directors then in
office.
CERTAIN CHARTER AND BYLAW PROVISIONS
The Company's Bylaws require stockholders to provide advance notice of
any stockholder nominations for directors and of any business to be brought
before any meeting of stockholders. Stockholders are not entitled to
cumulative voting in connection with the election of directors. As a result, a
person or a group controlling the majority of shares of Common Stock can elect
all of the directors.
The Company's Restated Certificate of Incorporation contains certain
provisions permitted under the Delaware General Corporation Law relating to the
liability of directors. These provisions eliminate the directors' liability for
monetary damages for a breach of fiduciary duty, except in certain circumstances
involving wrongful acts, including the breach of a director's duty of loyalty or
acts or omissions which involve intentional misconduct or a knowing violation of
a law. The Company's Restated Certificate of Incorporation also contains
provisions to indemnify its directors and officers to the fullest extent
permitted by the Delaware General Corporation Law.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for the Common Stock is U.S. Stock
Transfer Corporation.
LEGAL MATTERS
The validity of the securities offered hereby will be passed upon for
the Company by Brobeck, Phleger & Harrison LLP, Newport Beach, California. In
addition, certain members and employees of such firm are stockholders of the
Company.
EXPERTS
The consolidated financial statements of The Cerplex Group, Inc. as of
December 31, 1996 and 1995, and for each of the years in the three-year period
ended December 31, 1996, have been incorporated by reference herein and in the
registration statement 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.
11
<PAGE> 13
INFORMATION WITH RESPECT TO THE REGISTRANT
A copy of the Company's latest Form 10-K and the Company's latest Form
10-Q is being provided herewith without charge to each person to whom a copy of
this prospectus is being delivered.
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 Over-The-Counter Bulletin Board. 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-2 (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 29, 1996; (ii) the Quarterly Report of
the Company on Form 10-Q for the quarter ended June 30, 1997; (iii) the
Quarterly Report of the Company on Form 10-Q for the quarter ended March 29,
1997; (iv) the Proxy Statement of the Company in connection with the Annual
Meeting of Security Holders to be held on June 10, 1997; (v) the Quarterly
Report of the Company on Form 10-Q for the quarter ended June 30, 1997; and
(vi) the Current Report of the Company on Form 8-K dated August 27, 1997.
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 Chief Executive Officer at The Cerplex Group,
Inc., 1382 Bell Avenue, Tustin, CA 92780 or by telephone at (714) 258-5600.
12
<PAGE> 14
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 registration fee. All of the
expenses below will be paid by the Company.
<TABLE>
<CAPTION>
ITEM
- ----
<S> <C>
Registration Fee................................................................................. $ 4,242.65
Printing and engraving expenses.................................................................. 2,000.00
Legal fees and expenses.......................................................................... 20,000.00
Accounting fees and expenses..................................................................... 7,000.00
Transfer Agent and Registrar fees................................................................ 2,000.00
Miscellaneous.................................................................................... 5,000.00
----------
Total........................................................................................ $36,242.65
</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 proceeding,
including any action by or in the right of the Company, on account of services
as a director or officer of the
II-1
<PAGE> 15
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.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER TITLE METHOD OF FILING
------ ----- ----------------
<S> <C> <C>
2.1 Agreement of Merger dated as of August 30, 1993, by and among Cerplex Incorporated herein by reference to Exhibit 2.1
Incorporated, Diversified Manufacturing Services, Inc. ("DMS"), to the Company's Registration Statement on Form
EMServe, Inc. ("EMServe"), InCirT Technology Incorporated ("InCirT") S-1 (File No. 33-75004) which was declared
and Testar, Inc. ("Testar"). effective by the Commission on April 8, 1994.
2.2 Agreement and Plan of Merger dated November 12, 1993, between The Incorporated herein by reference to Exhibit 2.2
Cerplex Group Subsidiary, Inc. and Registrant (conformed copy to to the Company's Registration Statement on Form
original). S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
2.3 Certificate of Ownership and Merger of Registrant with and into The Incorporated herein by reference to Exhibit 2.2
Cerplex Group Subsidiary, Inc. dated as of November 12, 1993. to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
2.4 Asset Purchase Agreement effective December 17, 1993 by and between Incorporated herein by reference to Exhibit 2.4
Certech Technology, Inc., a wholly-owned subsidiary of the Registrant to the Company's Registration Statement on Form
("Certech"), and Spectradyne, Inc. ("Spectradyne"). S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
2.5 Purchase and Sale Agreement dated as of July 29, 1994, by and among Incorporated herein by reference to Exhibit 2 to
The Cerplex Group, Inc., Cerplex Limited, BT Repair Services Limited the Form 8-K filed July 29, 1994.
and BT.
2.6 Contract for repair, calibration and warehousing of certain items of Incorporated herein by reference to Exhibit 10 to
BT Equipment dated as of July 29, 1994, among The Cerplex Group and the Form 8-K filed July 29, 1994.
Cerplex Limited and BT.
2.7 Formation and Contribution Agreement effective December 1, 1994 by Incorporated herein by reference to Exhibit 2.7
and among Modcomp/Cerplex L.P., Modular Computer Systems, Inc., to the Company's Annual Report on Form 10-K for
Cerplex Subsidiary, Inc. and The Cerplex Group, Inc. the fiscal year ended January 1, 1995.
2.8 Contingent Promissory Note dated December 1, 1994 issued by Incorporated herein by reference to Exhibit 2.8
Modcomp/Cerplex L.P. to Modular Computer Systems, Inc. to the Company's Annual Report on Form 10-K for
the fiscal year ended January 1, 1995.
2.9 Limited Partnership Agreement of Modcomp/Cerplex L.P. effective Incorporated herein by reference to Exhibit 2.8
December 1, 1994. to the Company's Annual Report on Form 10-K for
the fiscal year ended January 1, 1995.
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2.10 Put/Call Option Agreement effective December 1, 1994 by and among Incorporated herein by reference to Exhibit 2.8
Cerplex Subsidiary, Inc., The Cerplex Group, Inc., Modular Computer to the Company's Annual Report on Form 10-K for
Systems, Inc. and Modcomp Joint Venture Inc. the fiscal year ended January 1, 1995.
2.11 Stock Purchase Agreement dated as of June 29, 1995 by and among The Incorporated herein by reference to Exhibit 2.11
Cerplex Group, Inc., Tu Nguyen and Phuc Le. to the Company's Quarterly Report on Form 10-Q
for the quarter ended October 1, 1995.
2.12 Letter Agreement dated April 5, 1996 by and among Modular Computer Incorporated herein by reference to Exhibit 2.12
Systems, Inc., Modcomp Joint Venture, Inc., AEG Aktiengesellschaft, to the Company's Annual Report on Form 10-K for
the Company, Cerplex Subsidiary, Inc. and Modcomp/Cerplex L.P. the fiscal year ended December 31, 1995.
2.13 Stock Purchase Agreement dated as of May 24, 1996, by and among The Incorporated herein by reference to Exhibit 2.13
Cerplex Group, Inc., Cerplex Limited, Rank Xerox - The Document to the Company's Current Report on Form 8-K dated
Company SA and Rank Xerox Limited (conformed copy to original). May 24, 1996.
2.14 Contract of Warranty dated as of May 24, 1996, by and among The Incorporated herein by reference to Exhibit 2.14
Cerplex Group, Inc., Cerplex Limited, Rank Xerox - The Document to the Company's Current Report on Form 8-K dated
Company SA and Rank Xerox Limited (conformed copy to the original). May 24, 1996.
2.15 Supply and Services Agreement dated as of May 24, 1996, by and among Incorporated herein by reference to Exhibit 2.15
The Cerplex Group, Inc., Cerplex Limited, Rank Xerox - The Document to the Company's Current Report on Form 8-K dated
Company SA and Rank Xerox Limited (conformed copy to the original). May 24, 1996.
2.16 Stock Purchase Agreement dated March 28, 1997 relating to all of the Incorporated herein by reference to Exhibit 2.13
outstanding stock of Peripheral Computer Support, Inc. among the to the Company's Annual Report on Form 10-K for
Company, PCS Acquisition Co., Inc., and Lincolnshire Equity Partners, the fiscal year ended December 31, 1996.
L.P.
2.17 Asset Purchase Agreement dated August 6, 1997 by and among the Incorporated herein by reference to Exhibit 2.17
Company, Cerplex Subsidiary, Inc., Modcomp Joint Venture, Inc., to the Company's Quarterly Report on Form 10-Q
Modcomp/Cerplex L.P. and CSP Inc. for the quarter ended June 30, 1997.
3.1 Restated Certificate of Incorporation of the Registrant. Incorporated herein by reference to Exhibit 3.1
to the Company's Registration Statement on From
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
3.2 Bylaws of the Registrant Incorporated herein by reference to Exhibit 3.2
to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
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3.3 Certificate of Amendment of the Restated Certificate of Incorporation Incorporated herein by reference to Exhibit 3.3
of the Registrant (filed June 16, 1997). to the Company's Quarterly Report on Form 10-Q
for the quarter ended June 30, 1997.
4.1 Stock Purchase Agreement dated as of November 19, 1993 by and among Incorporated herein by reference to Exhibit 4.1
the Registrant, the stockholders of the Registrant identified in Part to the Company's Registration Statement on Form
A of Schedule I thereto and the purchasers of shares of the S-1 (File No. 33-75004) which was declared
Registrant's Series A Preferred Stock identified in Schedule I effective by the Commission on April 8, 1994.
thereto (including the Schedules thereto; Exhibits omitted).
4.2 Registration Rights Agreement dated as of November 19, 1993, by and Incorporated herein by reference to Exhibit 4.2
among the Registrant, the investors listed on Schedule A thereto and to the Company's Registration Statement on Form
the security holders of the Registrant listed on Schedule B thereto, S-1 (File No. 33-75004) which was declared
together with Amendment No. 1. effective by the Commission on April 8, 1994.
4.3 Co-Sale Agreement dated as of November 19, 1993, by and among the Incorporated herein by reference to Exhibit 4.3
Registrant, the managers listed on Schedule A thereto and the to the Company's Registration Statement on Form
investors listed on Schedule B thereto. S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
4.4 Warrant Agreement dated as of November 19, 1993, by and among the Incorporated herein by reference to Exhibit 4.4
Registrant and the purchasers listed in Annex 1 thereto. to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
4.5 Placement Agent Warrant Purchase Agreement dated as of November 19, Incorporated herein by reference to Exhibit 4.5
1993, between the Registrant and Donaldson, Lufkin & Jenrette to the Company's Registration Statement on Form
Securities Corporation. S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
4.6 Observation Rights Agreement dated as of November 19, 1993, between Incorporated herein by reference to Exhibit 4.6
the Registrant and certain stock purchasers. to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
4.7 Observation Rights Agreement dated as of November 19, 1993, between Incorporated herein by reference to Exhibit 4.7
the Registrant and certain note purchasers. to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
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4.8 Note Purchase Agreement dated as of November 19, 1993, by and among Incorporated herein by reference to Exhibit 4.8
the Registrant and The Northwestern Mutual Life Insurance Company, to the Company's Registration Statement on Form
John Hancock Mutual Life Insurance, Registrant and Bank of Scotland S-1 (File No. 33-75004) which was declared
London Nominees Limited. effective by the Commission on April 8, 1994.
4.9 Amendment No. 2 to Registration Rights Agreement dated as of April 6, Incorporated herein by reference to Exhibit 4.9
1994, by and among the Registrant and certain of its Securities to the Company's Registration Statement on Form
holders. S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
4.10 Amendment to Note Purchase Agreement, dated as of October 27, 1994, Incorporated herein by reference to Exhibit 4.10
by and among the Company, Northwestern Mutual Life Insurance Company, to the Company's Annual Report on Form 10-K for
John Hancock Mutual Life Insurance Company and North Atlantic Smaller the fiscal year ended March 31, 1995.
Companies Trust P.L.C. (collectively, the "Noteholders").
4.11 Waiver and Amendment Agreement dated April 15, 1996 by and among Incorporated herein by reference to Exhibit 4.11
Company, The Northwestern Mutual Life Insurance Company, John Hancock to the Company's Annual Report on Form 10-K for
Mutual Life Insurance Company and North Atlantic Smaller Companies the fiscal year ended December 31, 1995.
Investment Trust PLC.
4.12 Warrant Agreement dated as of April 15, 1996 by and among Company, Incorporated herein by reference to Exhibit 4.12
The Northwestern Mutual Life Insurance Company, John Hancock Mutual to the Company's Annual Report on Form 10-K for
Life Insurance Company and North Atlantic Smaller Companies the fiscal year ended December 31, 1995.
Investment Trust PLC.
4.13 First Amendment to Warrant Agreement dated April 15, 1996 by and Incorporated herein by reference to Exhibit 4.13
among Company and each of the holders of warrants listed on Schedule to the Company's Annual Report on Form 10-K for
A thereto, with respect to that certain Warrant Agreement dated the fiscal year ended December 31, 1995.
November 19, 1993.
4.14 First Amendment to Observation Rights Agreement dated as of April 15, Incorporated herein by reference to Exhibit 4.14
1996 between Company and certain note purchasers. to the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1995.
4.15 Third Amendment to Registration Rights Agreement dated as of April Incorporated herein by reference to Exhibit 4.15
15, 1996 by and among Company, the investors of Company listed on to the Company's Annual Report on Form 10-K for
Schedule A thereto and the security holders of Company listed on the fiscal year ended December 31, 1995.
Schedule B thereto.
4.16 Warrant Agreement dated April 15, 1996 by and among Company, Wells Incorporated herein by reference to Exhibit 4.16
Fargo Bank, National Association, Sumitomo Bank of California, BHF to the Company's Annual Report on Form 10-K for
Bank Aktiengesellschaft and Comerica Bank-California. the fiscal year ended December 31, 1995.
4.17 Stock Purchase Agreement dated June 10, 1996 by and among the Company Incorporated herein by reference to Exhibit 4.17
and the investors listed on Schedule A thereto. to the Company's Quarterly Report on Form 10-Q
filed August 14, 1996.
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4.18 Fourth Amendment to Registration Rights Agreement dated June 10, 1996 Incorporated herein by reference to Exhibit 4.18
by and among Company, the investors listed on Schedule A thereto, the to the Company's Quarterly Report on Form 10-Q
security holders of Company listed on Schedule B thereto, the banks filed August 14, 1996.
listed on Schedule C thereto and each of the parties listed on
Schedule D thereto.
4.19 Certificate of Designation of Preferences of Series B Preferred Stock Incorporated herein by reference to Exhibit 3.3
of The Cerplex Group, Inc. to the Company's Quarterly Report on Form 10-Q
filed August 14, 1996.
4.20 Waiver and Amendment Agreement dated October 31, 1996 by and among Incorporated herein by reference to Exhibit 4.17
the company and the Noteholders. to the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1996.
4.21 Waiver and Amendment Agreement dated December 9, 1996 by and among Incorporated herein by reference to Exhibit 4.18
the company and the Noteholders. to the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1996.
4.22 Side Letter dated March 28, 1997 by and among the Company and the Incorporated herein by reference to Exhibit 4.19
Noteholders. to the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1996.
4.23 Amended and Restated Note Purchase Agreement dated April 9, 1997 by Incorporated herein by reference to Exhibit 4.20
and among the Company and the Noteholders. to the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1996.
4.24 Second Amendment to Warrant Agreement dated April 9, 1997, by and Incorporated herein by reference to Exhibit 4.21
among the Company and each of the holders of warrants listed on to the Company's Annual Report on Form 10-K for
Schedule A thereto, which Second Amendment amends the Warrant the fiscal year ended December 31, 1996.
Agreement dated November 19, 1993 as amended by the First Amendment
to Warrant Agreement dated April 15, 1996.
4.25 Second Amendment to Warrant Agreement dated April 9, 1997 by and Incorporated herein by reference to Exhibit 4.22
among the Company and each of the holders of warrants listed on to the Company's Annual Report on Form 10-K for
Schedule A thereto, which Second Amendment amends the Warrant the fiscal year ended December 31, 1996.
Agreement dated April 15, 1996, as amended by a Waiver and Amendment
Agreement dated October 31, 1996.
4.26 Amended and Restated Warrant Agreement dated April 9, 1997 by and Incorporated herein by reference to Exhibit 4.23
among the Company; Wells Fargo Bank, National Association; BHF-Bank to the Company's Annual Report on Form 10-K for
Aktiengesellschaft; and Citibank, N.A. the fiscal year ended December 31, 1996.
4.27 Fifth Amendment to Registration Rights Agreement dated as of April 9, Incorporated herein by reference to Exhibit 4.27
1997 by and among the Company, the investors listed on Schedule A to the Company's Quarterly Report on Form 10-Q
thereto, the security holders of the Company listed on Schedule B for the quarter ended June 30, 1997.
thereto, the banks listed on Schedule C thereto, and the parties
listed on Schedule D thereto.
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4.28 Waiver Agreement dated as of June 30, 1997 among the Company and the Incorporated herein by reference to Exhibit 4.28
Noteholders. to the Company's Quarterly Report on Form 10-Q
for the quarter ended June 30, 1997.
4.29 Side letter dated July 10, 1997 by and among the Company and the Incorporated herein by reference to Exhibit 4.29
Noteholders. to the Company's Quarterly Report on Form 10-Q
for the quarter ended June 30, 1997.
4.30 Side letter dated August 6, 1997 by and among the Company and the Incorporated herein by reference to Exhibit 4.30
Noteholders. to the Company's Quarterly Report on Form 10-Q
for the quarter ended June 30, 1997.
4.31 Sixth Amendment to Registration Rights Agreement dated as of August Incorporated herein by reference to Exhibit 4.31
20, 1997 by and among the Company, the investors listed on Schedule A to the Company's Current Report on Form 8-K dated
thereto, the security holders of the Company listed on Schedule B August 27, 1997.
thereto, the banks listed on Schedule C thereto, and the parties
listed on Schedule D thereto.
4.32 First Amendment Agreement dated as of August 20, 1997, by and among Incorporated herein by reference to Exhibit 4.32
the Company, The Northwestern Mutual Life Insurance Company, John to the Company's Current Report on Form 8-K dated
Hancock Mutual Life Insurance Company and North Atlantic Smaller August 27, 1997.
Companies Investment Trust PLC.
4.33 Warrant Agreement dated as of August 20, 1997 by and between the Incorporated herein by reference to Exhibit 4.33
Company, The Northwestern Mutual Life Insurance Company, John Hancock to the Company's Current Report on Form 8-K dated
Mutual Life Insurance Company and North Atlantic Smaller Companies August 27, 1997.
Investment Trust PLC.
4.34 Third Amendment to Warrant Agreement dated as of August 20, 1997, by Incorporated herein by reference to Exhibit 4.34
and among the Company and the Noteholders with respect to that to the Company's Current Report on Form 8-K dated
certain Warrant Agreement dated as of April 15, 1996 by and among the August 27, 1997.
Company and the Noteholders.
4.35 Third Amendment to Warrant Agreement dated as of August 20, 1997, by Incorporated herein by reference to Exhibit 4.35
and among the Company and the Noteholders with respect to that to the Company's Current Report on Form 8-K dated
certain Warrant Agreement dated as of November 19, 1993 by and among August 27, 1997.
the Company and the Noteholders.
4.36 Warrant Agreement dated as of August 20, 1997 by and between the Incorporated herein by reference to Exhibit 4.36
Company and Citibank, N.A. to the Company's Current Report on Form 8-K dated
August 27, 1997.
4.37 Second Amendment to Observation Rights Agreement dated August 20, Incorporated herein by reference to Exhibit 4.37
1997 by and among the Company, the Northwestern Mutual Life Insurance to the Company's Current Report on Form 8-K dated
Company and John Hancock Mutual Life Insurance Company. August 27, 1997.
5.1 Opinion of Brobeck, Phleger & Harrison LLP Filed herein.
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10.1 The Registrant's 1990 Stock Option Plan (the "1990 Plan"). Incorporated herein by reference to Exhibit 10.1
to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.2 Form of Stock Option Agreement pertaining to the 1990 Plan. Incorporated herein by reference to Exhibit 10.2
to the Company's Registration Statement on Form
S-1 (File No. 33-75005) which was declared
effective by the Commission on April 8, 1994.
10.3 Form of Stock Purchase Agreement pertaining to the 1990 Plan. Incorporated herein by reference to Exhibit 10.3
to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.4 The Registrant's 1993 Stock Option Plan (the "1993 Plan"). Incorporated herein by reference to Exhibit 10.4
to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.5 Form of Stock option Agreement (grants to employees) pertaining to Incorporated herein by reference to Exhibit 10.5
the 1993 Plan. to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.6 Form of Stock Option Agreement (grants to directors and certain Incorporated herein by reference to Exhibit 10.6
officers) pertaining to the 1993 Plan. to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.7 Form of Stock Purchase Agreement for Installment Options pertaining Incorporated herein by reference to Exhibit 10.7
to the 1993 Plan. to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.8 Form of Stock Purchase Agreement for Immediately Exercisable Options Incorporated herein by reference to Exhibit 10.8
pertaining to the 1993 Plan. to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
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10.9 The Registrant's Restated 1993 Stock Option Plan (the "Restated Incorporated herein by reference to Exhibit 10.9
Plan"). to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.10 Form of Stock Option Agreement, together with Addenda, pertaining to Incorporated herein by reference to Exhibit 10.10
the Restated Plan. to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.11 Master Task Agreement dated December 1, 1991, by and between Incorporated herein by reference to Exhibit 10.11
International Business Machines Incorporated ("IBM") and the to the Company's Registration Statement on Form
Registrant, together with Amendment to Master Agreement and Task S-1 (File No. 33-75004) which was declared
Order. effective by the Commission on April 8, 1994.
10.12 Master Agreement dated May 6, 1992 by and between IBM and the Incorporated herein by reference to Exhibit 10.12
Company. to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.13 Technology Services Agreement effective March 1, 1993, by and between Incorporated herein by reference to Exhibit 10.13
Novadyne Computer Systems, Inc. ("Novadyne") and Cerplex Incorporated to the Company's Registration Statement on Form
(a California corporation and a predecessor of the Registrant), S-1 (File No. 33-75004) which was declared
together with Amendments Nos. 1 and 2. effective by the Commission on April 8, 1994.
10.14 Technology Services Agreement effective December 17, 1993, by and Incorporated herein by reference to Exhibit 10.14
between Spectradyne, Inc. ("Spectradyne") and the Registrant. to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.15 Repair Services Agreement dated January 1, 1994 by and between Bull Incorporated herein by reference to Exhibit 10.24
HN Information Systems, Inc. and the Registrant. to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.16 Form of Indemnity Agreement. Incorporated herein by reference to Exhibit 10.15
to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
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10.17 Lease Agreement dated April 1, 1992 by and between Henry G. Page Jr., Incorporated herein by reference to Exhibit 10.16
and Diversified Manufacturing Services, Inc. ("DMS"). to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.18 Sublease dated January 1, 1994 by and between Bull and Cerplex Group, Incorporated herein by reference to Exhibit 10.17
Inc. (a Massachusetts corporation). to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.19 Standard Industrial/Commercial Single-Tenant Lease - Net dated Incorporated herein by reference to Exhibit 10.18
November 29, 1990 by and among Kilroy Building 73 Partnership, to the Company's Registration Statement on Form
Cerplex Incorporated and InCirT, together with Amendment No. 1 S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.20 Lease dated December 17, 1993 by and between Spectradyne and Certech. Incorporated herein by reference to Exhibit 10.19
to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.21 Sublease dated March 1, 1993 by and between Novadyne and the Incorporated herein by reference to Exhibit 10.20
Registrant together with Lease Amendment dated July 22, 1991 by and to the Company's Registration Statement on Form
between McDonnell Douglas Realty Company and Novadyne. S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.22 Standard Industrial/Commercial Lease - Net dated September 4, 1991 by Incorporated herein by reference to Exhibit 10.21
and between Proficient Food Company and W.C. Cartwright Corporation to the Company's Registration Statement on Form
("Cartwright"), together with Addendum and Sublease dated September S-1 (File No. 33-75004) which was declared
6, 1991 by and between Cartwright and the Registrant. effective by the Commission on April 8, 1994.
10.23 Sublease dated July 30, 1992 by and between Cartwright and DMS. Incorporated herein by reference to Exhibit 10.22
to the Company's Registration Statement on Form
S-1 (File No. 33-75004) which was declared
effective by the Commission on April 8, 1994.
10.24 Credit Agreement dated as of October 12, 1994 (the "Credit Incorporated herein by reference to Exhibit 10.24
Agreement") among The Cerplex Group, Inc., as Borrower; the lenders to the Company's Annual Report on Form 10-K for
listed therein, as Lenders; and Wells Fargo Bank, National the fiscal year ended January 1, 1995.
Association, as Administrative Agent; and those certain exhibits,
schedules and collateral documents to such Credit Agreement.
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10.25 Limited Waiver dated as of November 14, 1995 ("Waiver") by and among Incorporated herein by reference to Exhibit 10.25
The Cerplex Group, Inc. (the "Company"), the financial institutions to the Company's Quarterly Report on Form 10-Q
listed on the signature pages thereof ("Lenders"), and Wells Fargo for the quarter ended October 1, 1995.
Bank, National Association, as administrative agent for the Lenders
("Administrative Agent"), and for certain limited purposes, Certech
Technology, Inc., Cerplex Mass., Inc., Cerplex Limited, Apex Computer
Company, Cerplex Subsidiary, Inc. and Peripheral Computer Support,
Inc. (the "Subsidiaries"), which Waiver is made with reference to the
Credit Agreement.
10.26 The Cerplex Group, Inc. Restated 1993 Stock Option Plan (Restated and Incorporated herein by reference to Exhibit 10.26
Amended as of January 13, 1995). to the Company's Quarterly Report on Form 10-Q
for the quarter ended October 1, 1995.
10.27 The Cerplex Group, Inc. Automatic Stock Option Agreement. Incorporated herein by reference to Exhibit 10.27
to the Company's Quarterly Report on Form 10-Q
for the quarter ended October 1, 1995.
10.28 First Amendment to Credit Agreement dated April 15, 1996 by and among Incorporated herein by reference to Exhibit 10.28
Company, the lenders whose signatures appear on the signature pages to the Company's Annual Report on Form 10-K for
thereof, as Lenders; Wells Fargo Bank, National Association, as the fiscal year ended December 31, 1995.
Administrative Agent; and the Subsidiaries for certain limited
purposes.
10.29 Promissory Note dated June 21, 1996 payable by the Company to Lucent Incorporated herein by reference to Exhibit 10.29
Technologies. to the Company's Quarterly Report on Form 10-Q
for the quarter ended June 30, 1996.
10.30 Limited Waiver dated as of October 31, 1996 by and among the Company, Incorporated herein by reference to Exhibit 10.29
Lenders and Administrative Agent, and for certain limited purposes, to the Company's Quarterly Report on Form 10-Q
the Subsidiaries, Modcomp/Cerplex L.P., Modcomp Joint Venture, Inc., for the quarter ended September 29, 1996.
Modular Computer Services, Inc., Modular Computer Systems GmbH and
Modcomp France S.A., which waiver is made with reference to the
credit Agreement.
10.31 Extension and Forbearance Agreement dated March 31, 1997 by and among Incorporated herein by reference to Exhibit 10.31
the Company, the financial institutions listed on the signature pages to the Company's Annual Report on Form 10-K for
thereof and Wells Fargo Bank, National Association. the fiscal year ended December 31, 1996.
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10.32 Second Amendment to Credit Agreement dated November 30, 1996 (the Incorporated herein by reference to Exhibit 10.32
"Second Amendment") by and among the Company, the financial to the Company's Annual Report on Form 10-K for
institutions listed on the signature pages thereof ("Lenders") and the fiscal year ended December 31, 1996.
Wells Fargo Bank, National Association, as administrative agent for
the Lenders, and for certain limited purposes, Certech Technology,
Inc., Cerplex Mass., Inc., Cerplex Limited, Apex Computer Company,
Cerplex Subsidiary, Inc., Peripheral Computer Support, Inc.,
Modcomp/Cerplex, L.P., Modcomp Joint Venture, Inc., Modular Computer
Services, Inc., Modular Computer Systems GmbH and Modcomp France
S.A., which Second Amendment amends the Credit Agreement dated
October 12, 1994, as amended.
10.33 Third Amendment to Credit Agreement dated April 9, 1997 (the "Third Incorporated herein by reference to Exhibit 10.33
Amendment") by and among the Company, the financial institutions to the Company's Annual Report on Form 10-K for
listed on the signature pages thereof ("Lenders") and Wells Fargo the fiscal year ended December 31, 1996.
Bank, National Association, as administrative agent for the Lenders,
and for certain limited purposes, Certech Technology, Inc., Cerplex
Mass., Inc., Cerplex Limited, Apex Computer Company, Cerplex
Subsidiary, Inc., Peripheral Computer Support, Inc., Modcomp/Cerplex,
L.P., Modcomp Joint Venture, Inc., Modular Computer Services, Inc.,
Modular Computer Systems GmbH and Modcomp France S.A., which Third
Amendment amends the Credit Agreement dated October 12, 1994, as
amended.
10.34 Fourth Amendment to Credit Agreement and Limited Waiver dated as of Incorporated herein by reference to the Company's
May 30, 1997 and entered into by and among the Company, the financial Registration Statement on Form S-2 (Registration
institutions listed on the signature pages thereof ("Lenders") and No. 333-28425) filed with the Securities and
Wells Fargo Bank, National Association, as administrative agent for Exchange Commission on June 3, 1997.
the Lenders, and for certain limited purposes, Certech Technology,
Inc., Cerplex Mass., Inc., Cerplex Limited, Apex Computer Company,
Cerplex Subsidiary, Inc., Modcomp/Cerplex L.P., Modcomp Joint
Venture, Inc., Modular Computer Services, Inc., Modular Computer
Systems GmbH and Modcomp France S.A.
10.35 Fifth Amendment to Credit Agreement and Limited Waiver dated June 30, Incorporated herein by reference to Exhibit 10.35
1997 by and among the Company, the financial institutions listed on to the Company's Quarterly Report on Form 10-Q
the signature pages thereof ("Lenders") and Wells Fargo Bank, for the quarter ended June 30, 1997.
National Association, as administrative agent for the Lenders and,
for certain limited purposes, certain subsidiaries of the Company.
10.36 Sixth Amendment to Credit Agreement and Consent dated August 6, 1997 Incorporated herein by reference to Exhibit 10.36
by and among the Company, the financial institutions listed on the to the Company's Quarterly Report on Form 10-Q
signature pages thereof ("Lenders") and Wells Fargo Bank, National for the quarter ended June 30, 1997.
Association as administrative agent for the Lenders as administrative
agent for the Lenders and, for certain limited purposes, certain
subsidiaries of the Company.
</TABLE>
II-12
<PAGE> 26
<TABLE>
<CAPTION>
EXHIBIT
NUMBER TITLE METHOD OF FILING
- ------ ----- ----------------
<S> <C> <C>
23.1 Consent of KPMG Peat Marwick LLP, Filed herein.
Independent Public Accountants.
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 p. II-15 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.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in 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
II-13
<PAGE> 27
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-14
<PAGE> 28
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-2 and has duly caused this Amendment No. 2 to
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Tustin, State of California, on
October 15, 1997.
THE CERPLEX GROUP, INC.
By /s/ Stephen J. Hopkins
--------------------------------
Stephen J. Hopkins
Chief Executive Officer
POWER OF ATTORNEY
We, the undersigned officers and directors of The Cerplex Group, Inc., do
hereby constitute and appoint William A. Klein and Robert W. Hughes 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 AMENDMENT NO. 2 TO
THIS REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
* Stephen J. Hopkins Chief Executive Officer October 15, 1997
-----------------------------------------
Stephen J. Hopkins
* Richard C. Davis Director October 15, 1997
-----------------------------------------
Richard C. Davis
/s/ Robert W. Hughes Senior Vice President and October 15, 1997
----------------------------------------- Chief Financial Officer
Robert W. Hughes (Principal Accounting
Officer)
* Robert Finzi Director October 15, 1997
-----------------------------------------
Robert Finzi
* Jerome Jacobson Director October 15, 1997
-----------------------------------------
Jerome Jacobson
* Patrick S. Jones Director October 15, 1997
-----------------------------------------
Patrick S. Jones
* Myron Kunin Director October 15, 1997
-----------------------------------------
Myron Kunin
*By: /s/ Robert W. Hughes
---------------------------------
Robert W. Hughes, As Attorney In
Fact
</TABLE>
II-15
<PAGE> 29
THE CERPLEX GROUP, INC.
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Sequentially
Numbered
Exhibits Description Page
-------- ----------- ------------
<S> <C> <C>
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-13 of this
Registration Statement).....................................
</TABLE>
II-16
<PAGE> 1
Exhibit 5.1
October 15, 1997
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
Delaware corporation, in connection with its registration of 37,112,579 shares
of Common Stock (the "Common Stock") as described in the Company's Registration
Statement on Form S-2, 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
II-17
<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
October 15, 1997
II-18
