-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, H5lgvDerVnquLhaOxUeqRBCDcyEfnh52HBm3hfLQwb1tTXC0YcZm4vp4Frs/Z1sD jo7NSAfqaG4hc1quiIipQw== 0000950134-97-007165.txt : 19971002 0000950134-97-007165.hdr.sgml : 19971002 ACCESSION NUMBER: 0000950134-97-007165 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19970918 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19971001 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: IMCO RECYCLING INC CENTRAL INDEX KEY: 0000202890 STANDARD INDUSTRIAL CLASSIFICATION: SECONDARY SMELTING & REFINING OF NONFERROUS METALS [3341] IRS NUMBER: 752008280 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-07170 FILM NUMBER: 97689626 BUSINESS ADDRESS: STREET 1: 5215 N OCONNOR BLVD STE 940 CITY: IRVING STATE: TX ZIP: 75007 BUSINESS PHONE: 2148696575 MAIL ADDRESS: STREET 1: 5215 N O CONNOR BOULVARD STE 940 CITY: IRVING STATE: TX ZIP: 75030 FORMER COMPANY: FORMER CONFORMED NAME: FRONTIER TEXAS CORP DATE OF NAME CHANGE: 19881012 FORMER COMPANY: FORMER CONFORMED NAME: PIONEER TEXAS CORP DATE OF NAME CHANGE: 19850416 8-K 1 FORM 8-K 1 =============================================================================== SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): SEPTEMBER 18, 1997 IMCO RECYCLING INC. (Exact name of registrant as specified in its charter) DELAWARE 1-7170 75-2008280 (State or other jurisdiction (Commission (I.R.S. Employer of incorporation) File Number) Identification No.) 5215 NORTH O'CONNOR BLVD., SUITE 940 CENTRAL TOWER AT WILLIAMS SQUARE IRVING, TEXAS 75039 (Address of Principal Executive Offices) (972) 869-6575 (Registrant's telephone number, including area code) =============================================================================== 2 With respect to each contract, agreement or other document referred to herein and filed with the Securities and Exchange Commission as an exhibit to this report, reference is made to the exhibit for a more complete description of the matter involved, and each such statement shall be deemed qualified in its entirety by such reference. ITEM 5. OTHER EVENTS. On September 18, 1997, IMCO Recycling Inc. (the "Company") announced that it had entered into a non-binding letter of intent to acquire (the "Alchem Acquisition") in a privately-negotiated transaction all of the capital stock of Alchem Aluminum, Inc. ("Alchem"), in exchange for cash and 1,208,339 shares of common stock, $0.10 par value per share ("Common Stock"), of the Company. The amount of cash to be paid will be determined by deducting from $26,250,000, the aggregate amount of Alchem's obligations for borrowed money outstanding as of the closing date of the acquisition. At September 30, 1997, the amount of Alchem's indebtedness for borrowed money outstanding was $13,416,000. A total of 150,000 shares of Common Stock to be issued will be held in escrow by the Company for three years from the closing date of the Alchem Acquisition as potential recourse for the Company for breaches of representations and covenants by the Alchem shareholders. The terms of the letter of intent (which was amended on September 29, 1997) also provide that all shares of Common Stock to be issued in connection with the Alchem Acquisition will be contractually restricted from resale. Pursuant to the terms of the purchase agreement to be entered into between the Alchem shareholders and the Company, up to 350,000 shares of Common Stock may be transferred after one year from the closing date, up to an additional 350,000 shares may be transferred after two years from the closing date and all remaining shares may be transferred after three years. In addition, the Company plans to grant "piggyback" registration rights beginning in 1998 and rights to one demand registration commencing after the third anniversary of the closing date to the Alchem shareholders with regard to the shares of Common Stock to be issued in the Alchem Acquisition. The Company intends to account for the Alchem Acquisition using the purchase method of accounting. Alchem is a producer of specification aluminum alloys for automotive manufacturers and their suppliers and has been operating its facility located in Coldwater, Michigan since 1972. Alchem and the Company have also been operating under a joint venture agreement entered into in 1995 to construct and operate an aluminum recycling plant adjacent to Alchem's processing facility in Coldwater. This joint venture facility began operating in February 1997 and is expected to reach full capacity in October 1997. Alchem's facility has an annual melting capacity of 180 million pounds; the joint venture facility with the Company has an annual capacity of 150 million pounds. For its fiscal year ended October 31, 1996, Alchem had net sales of $112 million. For the six months ended June 30, 1997, Alchem had net sales of $74 million. The Alchem Acquisition will permit the Company to increase its participation in the automotive industry, broaden its customer base and expand its product range to include specification alloys. When the acquisition is completed, it is estimated that approximately 30% of the Company's annual domestic capacity will be supplied to the transportation sector. The acquisition is expected to increase the Company's total 1998 processing capacity to approximately 2.6 billion pounds. The terms concerning the acquisition contained in the letter of intent are non-binding on the signatories thereto. In addition, the Alchem Acquisition is subject to the conditions contained in the letter of intent and conditions to be contained in the purchase agreement to be entered into in connection with the acquisition. Although the Company believes that such conditions will be fully satisfied on or before the anticipated closing date of October 31, 1997, many of these conditions are beyond the control of the Company and there can be no assurance of when or whether the closing of the Alchem Acquisition -2- 3 will occur. Closing conditions will include the satisfaction of usual and customary closing conditions including the absence of any injunction or other legal restraint, the consent of third parties and governmental entities, the accuracy in all material respects of the representations and warranties to be made in the purchase agreement and the performance of all pre-closing agreements. Upon the closing of the Alchem Acquisition, it is expected that William Warshauer, the primary stockholder of Alchem, his family and certain affiliates of Alchem will own approximately 1.2 million shares of Common Stock, or 8.7% of the total outstanding shares of Common Stock. ITEM 7. FINANCIAL INFORMATION AND EXHIBITS. (c) Exhibits 10.1 Letter of Intent dated September 15, 1997, by and between the Company and Alchem Aluminum, Inc. 10.2 Amendment to Letter of Intent dated September 29, 1997. -3- 4 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. IMCO RECYCLING INC. ("Registrant") Date: October 1, 1997 /s/ DON V. INGRAM ------------------------------- Don V. Ingram Chairman of the Board -4- 5 INDEX TO EXHIBITS
EXHIBIT NUMBER - ------ 10.1 Letter of Intent dated as of September 15, 1997, by and between the Company and Alchem Aluminum, Inc. 10.2 Amendment to Letter of Intent dated September 29, 1997.
EX-10.1 2 LETTER OF INTENT 1 EXHIBIT 10.1 September 15, 1997 Mr. and Mrs. William Warshauer Alchem Aluminum, Inc. 368 West Garfield Avenue Coldwater, Michigan 49036 Dear Bill and Louise: This letter will confirm the understandings of IMCO Recycling Inc. ("IMCO") and each of you (the "Sellers") with respect to IMCO's purchase of all of the outstanding shares of capital stock of Alchem Aluminum, Inc. ("Alchem"). The material terms of the proposed transaction are as follows: 1. Purchase of Stock. IMCO will purchase all of the outstanding capital stock of Alchem (the 'Stock"), all of which is owned by the Sellers. At closing, the Sellers will deliver the Stock to IMCO free and clear of all liens and encumbrances. 2. Purchase Price. The total purchase price for the Stock will be $49,250,000, less the amount of Alchem's obligations for borrowed money as of the closing. The purchase price will be paid in shares of IMCO common stock. The average closing price of IMCO common stock for the 20 trading days preceding the date of this letter will be utilized to determine the number of shares of IMCO common stock to be issued at closing. 3. Registration Rights. The IMCO common stock to be issued at closing will consist of newly issued shares not registered with the Securities and Exchange Commission. In order to provide liquidity, IMCO will provide the Sellers with "piggy back" registration rights beginning in 1998, and with one demand registration right beginning three years after closing. The specific terms of such registration rights will be mutually agreed upon. 4. Transfer Restrictions. All shares of IMCO common stock issued at closing will be restricted from resale. However, up to 350,000 of the shares may be freely transferred after one year, up to an additional 350,000 shares may be transferred after two years, and all the remaining shares may be transferred after three years. 5. Escrow. An aggregate of 150,000 shares of the IMCO common stock issued at closing will be held in escrow for a period of three years in order to assure IMCO an adequate remedy against potential breaches of the Sellers' representation and warranties set forth in the definitive purchase agreement. 6. Employment Agreements. Key employees of Alchem will enter into employment agreements, which will include non-competition provisions. 2 7. Definitive Purchase Agreement. The parties intend to negotiate and execute a definitive purchase agreement (which will set forth the definitive terms of the transaction) as soon as is practicable. In the definitive purchase agreement, Alchem and the Sellers will make standard representations and warranties concerning title to the Alchem stock, the absence of material litigation, the absence of environmental liabilities, the financial condition of Alchem, and other standard representations and warranties which are customary in a transaction of this nature. 8. No Other Negotiations. Until October 31, 1997, neither Alchem nor any of the Sellers will enter into discussions or negotiations with any individual or firm (other than IMCO) relating to the sale of all or substantially all of the stock of Alchem, the sale of all or substantially all of its assets, a merger or consolidation, the issuance of capital stock of Alchem, or any other form of business combination or capital transaction with Alchem. The Sellers will immediately terminate any other existing discussions or negotiations with respect to any of the foregoing. 9. No Disclosure. All parties will hold this letter and its contents in strict confidence, and will not disclose this letter or its contents without the prior written authorization of the other parties, subject to the requirements of applicable law. 10. Operations of Alchem. From the date of this letter until the closing of the transaction, the Sellers will cause the operations of Alchem to be conducted in the ordinary course, consistent with past practice. 11. Expenses. The Sellers (on the one hand) and IMCO (on the other hand) will each pay all of their respective expenses in connection with the transaction. However, IMCO will pay the filing fee in connection with the initial filings of the parties under the Hart-Scott- Rodino Antitrust Improvements Act of 1976. 12. Conditions. The transaction described above will be subject to, among other conditions, the following: (a) Execution and delivery of a definitive purchase agreement setting forth the terms and conditions of the transaction, and containing usual and customary representations and warranties, covenants, indemnities and closing conditions; (b) Approval of the Board of Directors of IMCO; (c) Satisfactory "due diligence" examination by IMCO of all aspects of the proposed transaction; (d) Compliance with the Hart-Scott Rodino Antitrust Improvements Act of 1976; (e) There must be no material change in the financial condition or operations of Alchem from that reflected in Alchem's financial statements dated June 30, 1997; and - 2 - 3 (f) Receipt of a satisfactory Phase 1 environmental report. No provision of this letter will constitute a legally binding obligation of any party unless included in the definitive purchase agreement contemplated hereby (except with respect to items 8 and 9, which are intended to be legally binding). If the foregoing terms correctly set forth our understandings, please so indicate by executing the enclosed copy of this letter and returning the copy to the undersigned. Very truly yours, IMCO RECYCLING INC. By: /s/ Don V. Ingram ------------------------------- Don V. Ingram Chairman of the Board and CEO AGREED TO AND ACCEPTED: /s/ William Warshauer - ------------------------------------ William Warshauer /s/ Louise Warshauer - ------------------------------------ Louise Warshauer - 3 - EX-10.2 3 AMENDMENT TO LETTER OF INTENT 1 [IMCO LOGO] EXHIBIT 10.2 September 29, 1997 Mr. and Mrs. William Warshauer Alchem Aluminum, Inc. 368 West Garfield Avenue Coldwater, Michigan 49036 Dear Bill and Louise: This letter will amend our previous letter of intent, dated September 15, 1997. All terms used herein will have the same definitions as in the letter of intent. Paragraph 2 of the letter will be amended, to read in its entirety as follows: "2. Purchase Price. The total purchase price for the Stock will be $49,250,000, less the amount of Alchem's obligations for borrowed money as of the closing. $23,000,000 of the purchase price will be paid in shares of IMCO common stock, with the balance to be paid in cash. The average closing price of IMCO common stock for the 20 trading days preceeding the date of this letter will be utilized to determine the number of shares of IMCO common stock to be issued at closing." All other terms of the letter of intent will be unaffected by this amendment. If the foregoing terms correctly set forth our understandings, please so indicate by executing the enclosed copy of this letter and returning the copy to the undersigned. Very truly yours, IMCO RECYCLING INC. By: /s/ DON V. INGRAM ---------------------------- Don V. Ingram Chairman of the Board and CEO AGREED TO AND ACCEPTED: /s/ WILLIAM WARSHAUER - ----------------------------- WILLIAM WARSHAUER /s/ LOUISE WARSHAUER - ----------------------------- LOUISE WARSHAUER [IMCO LETTERHEAD] -----END PRIVACY-ENHANCED MESSAGE-----