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U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
(Mark One)
[x] Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 For the quarterly period ended March 31, 2005
[ ] Transition report under Section 13 or 15(d) of the Exchange Act
For the transition period from _________ to_________
Commission file number 001-12127
EMPIRE RESOURCES, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 22-3136782
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
One Parker Plaza
Fort Lee, NJ 07024
(Address of Principal Executive Offices)
201 944-2200
(Registrant's Telephone Number, Including Area Code)
Check whether the Registrant: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes [X] No [ ]
Indicate by check mark whether the Registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
Yes [ ] No [X]
APPLICABLE ONLY TO CORPORATE ISSUERS
Common Stock, par value $0.01 per share 9,599,251
(Class) (Outstanding on May 10, 2005)
EMPIRE RESOURCES, INC.
FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2005
INDEX
PART I FINANCIAL INFORMATION
Item 1 Financial Statements Page
Condensed Consolidated Balance Sheets as of March 31, 2005 (unaudited)
and December 31, 2004.......................................................2
Condensed Consolidated Statements of Income for the Three Months
Ended March 31, 2005 and 2004 (unaudited) ..................................3
Condensed Consolidated Statements of Cash Flows for the Three Months
Ended March 31, 2005 and 2004 (unaudited) ..................................4
Notes to Condensed Consolidated Financial Statements (unaudited)............5
Item 2 Management's Discussion and Analysis of Financial Condition
and Results of Operations...................................................8
Item 3 Quantitative and Qualitative Disclosure of Market Risk.....................11
Item 4 Controls and Procedures ...................................................11
PART II OTHER INFORMATION
Item 1 Legal Proceedings..........................................................13
Item 2 Unregistered Sales of Equity Securities and Use of Proceeds ...............13
Item 3 Defaults Upon Senior Securities ...........................................13
Item 4 Submission of Matters to a Vote of Security Holders .......................13
Item 5 Other Information .........................................................13
Item 6 Exhibits ..................................................................13
Signatures..............................................................14
(i)
Introduction
The condensed consolidated interim financial statements included herein
have been prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles in the United States of
America have been omitted pursuant to such rules and regulations. In the opinion
of management, such financial statements reflect all adjustments necessary for a
fair presentation of the results for the interim periods presented and to make
such financial statements not misleading. The results of operations of the
Company for the three months ended March 31, 2005 are not necessarily indicative
of the results to be expected for the full year. It is suggested that these
interim financial statements be read in conjunction with the consolidated
financial statements and the notes thereto included in the Company's Annual
Report filed on Form 10-K for the year ended December 31, 2004.
1
EMPIRE RESOURCES, INC.
Condensed Consolidated Balance Sheets
In Thousands, except shares and per share amounts
March 31, December 31,
--------------------------
2005 2004
--------------------------
(unaudited)
ASSETS
Current assets:
Cash $ 2,765 $ 287
Trade accounts receivable (less allowance for doubtful accounts of 49,394 30,367
$191 and $191)
Inventories 63,145 58,969
Other current assets 1,116 1,397
--------- ---------
Total current assets 116,420 91,020
Property and Equipment (less accumulated depreciation of $492 and $472) 3,196 2,895
--------- ---------
119,616 93,915
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable - banks $ 63,050 $ 40,300
Current maturities of long-term debt 104 94
Trade accounts payable 28,241 25,411
Accrued expenses 5,695 6,796
Dividends Payable 384 960
--------- ---------
Total current liabilities 97,474 73,561
--------- ---------
Long-term debt, net of current maturities 2,371 2,406
Commitments and contingencies
Stockholders' equity:
Common stock $.01 par value, 20,000,000 shares authorized and $ 117 117
11,749,651 shares issued at March 31, 2005 and December 31, 2004
Additional paid-in capital 10,827 10,827
Retained earnings 11,386 9,547
Accumulated other comprehensive income (2) 14
Treasury stock (2,150,400 shares) (2,557) (2,557)
--------- ---------
Total stockholders' equity 19,771 17,948
--------- ---------
119,616 93,915
========= =========
See notes to condensed consolidated financial statements 2
Condensed Consolidated Statements of Income (Unaudited)
In thousands, except per share amounts
Three Months Ended
March 31,
---------------------
2005 2004
---------------------
Net sales $80,014 $54,185
Cost of goods sold 74,140 50,349
------- -------
Gross profit 5,874 3,836
Selling, general and administrative expenses 1,756 1,691
------- -------
Operating income 4,118 2,145
Interest expense 564 299
------- -------
Income before income taxes 3,554 1,846
Income taxes 1,330 711
------- -------
Net income $ 2,224 $ 1,135
======= =======
Weighted average shares outstanding:
Basic 9,599 9,530
======= =======
Diluted 9,848 9,885
======= =======
Earnings per share:
Basic $ 0.23 $ 0.12
======= =======
Diluted $ 0.23 $ 0.11
======= =======
See notes to condensed consolidated financial statements 3
Condensed Consolidated Statements of Cash Flows (Unaudited)
In thousands
Three Months Ended
March 31,
-----------------------
2005 2004
-----------------------
Cash flows from operating activities:
Net income $ 2,224 $ 1,135
Adjustments to reconcile net income to net cash
(used in) provided by operating activities:
Depreciation and amortization 20 15
Changes in:
Trade accounts receivable (19,027) (5,547)
Inventories (4,176) 6,651
Other current assets 281 3,045
Trade accounts payable 2,830 (695)
Accrued expenses (1,118) (4,029)
-------- --------
Net cash (used in) provided by operating activities (18,966) 575
-------- --------
Cash flows used in investing activities:
Additions to fixed assets (321) (33)
-------- --------
Cash flows from financing activities:
Net proceeds from notes payable - banks 22,725 200
Proceeds - option exercised 0 22
Dividends Paid (960) (762)
-------- --------
Net cash provided by (used in) financing activities 21,765 (540)
-------- --------
Net increase in cash 2,478 2
Cash at beginning of period 287 1,477
-------- --------
Cash at end of period $ 2,765 $ 1,479
======== ========
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 601 $ 352
Income taxes $ 818 $ 140
Non Cash Financing Activities:
Dividend Declared but not yet paid $ 384 $ 382
See notes to condensed consolidated financial statements 4
Empire Resources, Inc.
Notes to Condensed Consolidated Financial Statements (Unaudited)
- --------------------------------------------------------------------------------
1. The Company
Empire Resources, Inc. (the "Company") is engaged in the purchase, sale and
distribution of principally nonferrous metals to a diverse customer base located
throughout the United States and Canada, Australia and New Zealand. The Company
sells its products through its own marketing and sales personnel and its
independent sales agents located in North America who receive commissions on
sales. The Company purchases its products from suppliers located throughout the
world; however, one supplier, Hulett Aluminium Ltd., supplied approximately 42%
of the Company's products during the first quarter of 2005. The Company does not
typically purchase inventory for stock; rather, it places orders with its
suppliers based upon orders that it has received from its customers.
In the fall of 2004, the Company entered into an agreement to purchase a
used aluminum extrusion press. The Company is modernizing and installing the
press in the newly purchased warehouse/distribution facility in Baltimore,
Maryland. The Company expects to begin manufacturing extrusions in the new
facility in late 2005 and expects that its current customers are potential
customers for its extrusions production.
The condensed consolidated financial statements include the accounts of
Empire Resources, Inc. and its wholly-owned subsidiaries, Empire Resources
Pacific Ltd., which acts as a sales agent for the Company in Australia. In
addition, the statements include 6900 Quad Avenue LLC, the company which
purchased the warehouse facility, and Empire Extrusions LLC the company which
will manufacture extrusions. All significant intercompany transactions and
accounts have been eliminated in consolidation.
2. Use of Estimates
The preparation of financial statements in accordance with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amount of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of income and
expenses during the reporting period. The principle estimate made relates to the
allowance for doubtful accounts. Actual results could differ from these
estimates.
3. Concentrations
One major customer accounted for approximately 17% of the Company's
consolidated net sales for the period ended March 31, 2005 and 16% for the
period ended March 31, 2004.
The Company's purchase of nonferrous metal is from a limited number of
suppliers located throughout the world. One supplier, Hulett Aluminium Ltd.,
accounted for 42% of total purchases during the period ended March 31, 2005 and
three other suppliers accounted for 43% of total purchases. The Company's loss
of any one of its largest suppliers or a material default by any such supplier
in its obligations to the Company would have at least a short-term material
adverse effect on the Company's business.
5
Empire Resources, Inc.
Notes to Condensed Consolidated Financial Statements (Unaudited)
- --------------------------------------------------------------------------------
4. Stock Options
The Company accounts for stock-based employee compensation under the
recognitions and measurement principles of Accounting Principles Board ("APB")
Opinion No. 25, "Accounting for Stock Issued to Employees", and related
interpretations. No stock-based employee compensation cost is reflected in net
income as all options granted under the Plan had an exercise price equal to the
market value of the underlying common stock on the date of grant. The Company
has adopted the disclosure-only provisions of Statement of Financial Accounting
Standards ("SFAS") No. 123, "Accounting for Stock-Based Compensation." For the
three months ended March 31, 2005 and 2004, there would be no effect on net
income and earnings per share if the fair value based method had been applied to
all awards.
5. Inventories
Inventories, which consist of purchased semi-finished aluminum products,
are stated at the lower of cost or market. Cost is determined by the
specific-identification method. Inventory has generally been purchased for
specific customer orders.
6. Notes Payable--Banks
As of March 31, 2005, the Company operated under a $75,000,000 committed
credit facility with four commercial banks. This facility as amended, expires on
June 30, 2006. Borrowings by the Company under this line of credit are
collateralized by security interests in substantially all its assets. Under the
agreement, the Company is required to maintain working capital and net worth
ratios as defined by the loan agreement. As of March 31, 2005 and 2004
respectively, the credit utilized under this facility amounted to $63.05 million
and $43.6 million (and approximately $10.7 million and $9.0 million of
outstanding letters of credit). Interest on borrowings is either (i) the federal
funds rate, (ii) the prime rate of JP Morgan Chase or (iii) LIBOR, plus the
applicable margins defined in the loan agreement.
In December 2004, the Company entered into a mortgage and an interest rate
swap in connection with the purchase of a warehouse. The mortgage, which
requires monthly payments of approximately $21,000 including interest, bears
interest at Libor + 1.75% and matures in December 2014. At the same time, the
Company entered into an interest rate swap with a bank which has been designated
as a cash flow hedge. Effective 2004 through December 29, 2014 each month the
Company will pay a fixed interest rate of 6.37% to the bank on a notional
principal equal to the outstanding principal balance of the mortgage. In return,
the bank will pay to the Company a floating rate, namely, LIBOR, to reset
monthly plus 1.75% on the same notional principal amount.
6
Empire Resources, Inc.
Notes to Condensed Consolidated Financial Statements (Unaudited)
- --------------------------------------------------------------------------------
7. Earnings Per Share
Three months ended
March 31,
---------------------
2005 2004
---- ----
Weighted average shares outstanding-basic 9,599 9,530
Dilutive effect of stock options 249 355
----- -----
Weighted average shares outstanding-diluted 9,848 9,885
===== =====
Basic earnings per share are based upon the Company's weighted average
number of common shares outstanding during each period. Diluted earnings per
share are based upon the weighted average number of common shares outstanding
during each period, assuming the issuance of common shares for all dilutive
potential common shares outstanding during the period, using the treasury stock
method.
8. Dividends
On March 10, 2005, the Board of Directors of the Company declared a cash
dividend of $0.04 per share to stockholders of record at the close of business
on March 31, 2005. The dividend totaling $384,000 is reflected in dividends
payable at March 31, 2005 and was paid on April 19, 2005.
9. Commitments and Contingencies
Empire has contingent liabilities in the form of letters of credit to
certain of its suppliers, which at March 31, 2005 amounted to approximately
$10.7 million.
The Company hedges metal pricing and foreign currency as it deems
appropriate for a portion of its purchase and sales contracts. There is a risk
of a counterparty default in fulfilling the hedge contract. Should there be a
counterparty default, the Company could be exposed to losses on the original
hedged contract.
7
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Forward Looking Statements
The discussions set forth below and elsewhere herein contain certain
statements that may be considered forward-looking statements under the Private
Securities Litigation Reform Act of 1995. The Company may make written or oral
forward-looking statements in other documents we file with the Securities and
Exchange Commission, in our annual reports to stockholders, in press releases
and other written materials, and in oral statements made by our officers,
directors or employees.
You can identify forward-looking statements by the use of the words
"believe," "expect," "anticipate," "intend," estimate," "assume," "will,"
"should," and other expressions which predict or indicate future events or
trends and which do not relate to historical matters. You should not rely on
forward-looking statements, because they involve known and unknown risks,
uncertainties and other factors, some of which are beyond the control of the
Company. These risks, uncertainties and other factors may cause the actual
results, performance or achievements of the Company to be materially different
from the anticipated future results, performance or achievements expressed or
implied by the forward-looking statements.
Among the significant factors that could cause our actual results to differ
materially from those expressed in forward-looking statements are: changes in
general, national or regional economic conditions; an act of war or terrorism
that disrupts international shipping; changes in laws, regulations and tariffs,
the imposition of anti-dumping duties on the products imported, including those
produced by Hulett Aluminium Ltd.; changes in the size and nature of the
Company's competition; changes in interest rates, foreign currencies or spot
prices of aluminum; loss of one or more foreign suppliers or key executives;
loss of one or more significant customers, increased credit risk from customers;
failure of the Company to grow internally or by acquisition and to integrate
acquired businesses; failure to improve operating margins and efficiencies; and
changes in the assumptions used in making such forward-looking statements. The
risks set forth in the immediately preceding sentence are not exhaustive. You
should carefully review all of these risk factors, and you should be aware that
there may be other factors that could cause these differences, including, among
others, the factors listed under "Risk Factors," beginning on page 17 of our
Annual Report on Form 10-K for the year ended December 31, 2004. Readers should
carefully review the factors described under "Risk Factors" and should not place
undue reliance on our forward-looking statements.
These forward-looking statements were based on information, plans and
estimates at the date of this report, and we undertake no obligation to update
any forward-looking statements to reflect changes in underlying assumptions or
factors, new information, future events or other changes. New risk factors
emerge from time to time, and it is not possible for us to predict all risk
factors, nor can we predict the impact of all risk factors on our business or to
the extent which any factor, or combination of factors, may cause actual results
to differ materially from those contained in forward-looking statements.
Overview
Empire is a distributor of value added, semi-finished aluminum products.
Consequently, Empire's sales volume has been, and will continue to be, a
function of its ongoing ability to secure
8
quality aluminum products from its suppliers. While the Company maintains
long-term supply relationships with several foreign mills, one such supplier,
Hulett Aluminium Ltd., ("Hulett") accounted for approximately 42% of the
Company's purchases during the quarter ended March 31, 2005.
The Company's ability to succeed is driven in part by continued customer
satisfaction, supplier and customer loyalty and the ability to manage the
competitive economic environment through the expansion and upgrading of its
service to its suppliers and customers. This includes the ability to ship
material on a just in time basis from both private and public warehouses, and
the establishment of a proprietary on-line service modules for customers to
track their shipments. This bolstered the Company's commitment to service and
customer satisfaction. The Company has also used its excellent customer
relationships to leverage sales per employee by developing long term
relationships with its customer and understanding their needs. Because the
Company has always engaged in a strategy of developing long term relationships,
it has been able to build sales volume without a similar increase in selling,
general and administrative expenses that would otherwise accompany customer
turn-over. The stable customer and supplier base has enabled the Company to
increase its purchases from its suppliers and to sell the majority of these
quantities to its existing customer base. While this does expose the Company to
concentration risks, it has provided the foundation of the Company's growth and
performance.
Application of Critical Accounting Policies
The Company's condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles in the
United States of America. Certain accounting policies have a significant impact
on amounts reported in the financial statements. A summary of those significant
accounting policies can be found in Note B to the Company's financial statements
included in the Company's 2004 Annual Report on Form 10-K. The Company has not
adopted any significant new accounting policies during the three-month period
ended March 31, 2005.
Among the significant judgments made by management in the preparation of
the Company's financial statements are the determination of the allowance for
doubtful accounts and accruals for inventory claims. These adjustments are made
each quarter in the ordinary course of accounting.
The Company reports accounts receivable, net of an allowance for doubtful
accounts, to represent its estimate of the amount that ultimately will be
realized in cash. The Company reviews the adequacy of its allowance for doubtful
accounts on an ongoing basis, using historical collection trends, aging of
receivables, as well as review of specific accounts, and makes adjustments in
the allowance as it believes necessary. The Company maintains a credit insurance
policy on the majority of its customers. This policy generally has a
co-insurance provision and specific limits on each customer's receivables. The
co-pay may be increased in selected instances and the Company sometimes elects
to exceed these specific credit limits. Changes in economic conditions could
have an impact on the collection of existing receivable balances or future
allowance considerations.
Generally, the Company's exposure on claims for defective material is small
as the Company refers all claims on defects back to the mill supplying the
material. In the event that the Company does not believe the mill will honor a
claim, the Company will record an allowance for inventory adjustments.
9
Results of Operations (in thousands)
During the first quarter of 2005 net sales increased $25,829 to $80,014, or
a 48% increase, from $54,185 in the first quarter of 2004. This increase was due
to approximately a 15% increase in shipments to the Company's customers and an
increase during the first quarter of approximately 15% in U.S. aluminum metal
pricing. Gross profit increased $2,038 to $5,874 in the first quarter of 2005,
or a 53% increase, from $3,836 in the first quarter of 2004. During this period
gross profit as a percentage of sales remained stable; the increase is due to an
overall increase of the Company's sales.
The Company experienced approximately a 4% increase in selling, general and
administrative costs. This is primarily attributable to increased payroll costs.
Interest expense grew during the quarter by $265 from $299 to $564. This
88% increase in interest expense is due to both the growth in loans outstanding
during the quarter to support revenue growth and the continued upward trend in
interest rates.
The Company's ability to grow sales without a substantial percentage
increase in selling, general and administrative costs led to an increase in net
income of 96% from $1,135 in March 2004 to $2,224 in March 2005. The Company's
ability to increase its supply has been and will continue to be the main factor
for increased revenues. The Company's top ten customers represented 43% of sales
in the first quarter of 2005 as compared to 48% during the first quarter of
2004.
Liquidity and Capital Resources (in thousands, except per share data)
The Company's cash flow from operations decreased by $19,541 from a use of
cash of $18,966 in the first quarter of 2005 compared to cash being provided by
operations of $575 in the first quarter of 2004 primarily due to the increase in
accounts receivable. This increase in accounts receivable is driven by the
increase in sales for the first quarter of 2005. The Company maintains a credit
insurance policy on its receivables and the Company believes that they are
collectible. Notes payable to the Company's bank increased by $22,750 during the
first quarter of 2005 to support the increase in accounts receivable and
inventories.
The $21,765 of net cash provided by financing activities was primarily the
result of borrowings under the Company's line of credit.
Empire currently operates under a $75,000 revolving line of credit,
including a commitment to issue letters of credit, with four commercial banks.
The Company's borrowings under this line of credit are collateralized by
security interests in substantially all of Empire's assets. Empire is required
to maintain working capital and net worth ratios under this credit agreement.
This facility will expire on June 30, 2006.
On March 11, 2005, the Company announced that its Board of Directors
declared a cash dividend of $0.04 per share. The dividend totaling $384 was paid
on April 19, 2005 to stockholders of record at the close of business on March
31, 2005. The Board of Directors will review its dividend policy on a quarterly
basis and a determination by the Board of Directors will be made subject to the
profitability and free cash flow and the other requirements of the business.
10
Management believes that cash from operations, together with funds
available under its credit facility, will be sufficient to fund the cash
requirements relating to the Company's existing operations for the next twelve
months. Empire may require additional debt or equity financing in connection
with the future expansion of its operations.
Commitments and Contingencies (in thousands)
Empire has contingent liabilities in the form of letters of credit totaling
$10,700 to certain of its suppliers and as of March 31, 2005, the credit
utilized under its credit facility amounted to $63,050. Except as noted, there
have been no material changes to the Company's commitments and contingencies
from that disclosed in our Annual Report on Form 10-K for the year ended
December 31, 2004.
The Company hedges metal pricing and foreign currency as it deems
appropriate for a portion of its purchase and sales contracts. There is a risk
of a counterparty default in fulfilling the hedge contract. Should there be a
counterparty default, the Company could be exposed to losses on the original
hedged contract.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE OF MARKET RISK
The Company uses financial instruments designated as fair value hedges to
manage its exposure to commodity price risk and foreign currency exchange risk
inherent in its operations. It is the Company's policy to hedge such risks, to
the extent practicable. The Company enters into high-grade aluminum futures
contracts to limit its gross margin exposure by hedging the metals content
element of firmly committed purchase and sales commitments. The Company also
enters into foreign exchange forward contracts to hedge its exposure related to
commitments to purchase or sell non-ferrous metals denominated in international
currencies. The Company records "mark-to-market" adjustments on these futures
and forward positions, and on the underlying firm purchase and sales commitments
which they hedge, and reflects the net gains and losses currently in earnings.
Refer to our Annual Report on Form 10-K for the year ended December 31,
2004 for more detailed disclosure about quantitative and qualitative disclosure
of market risk. Quantitative and qualitative disclosure about market risk have
not materially changed since December 31, 2004.
ITEM 4. CONTROLS AND PROCEDURES
As required by Rule 13a-15 under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), the Company's management conducted an evaluation
with the participation of the Company's Chief Executive Officer and Chief
Financial Officer, regarding the effectiveness of the Company's disclosure
controls and procedures, as of the end of the last fiscal quarter. In designing
and evaluating the Company's disclosure controls and procedures, the Company and
its management recognize that any controls and procedures, no matter how well
designed and operated, can provide only a reasonable assurance of achieving the
desired control objectives, and management necessarily was required to apply its
judgment in evaluating and implementing possible controls and procedures. Based
upon that evaluation, the Chief Executive Officer and Chief Financial Officer
concluded that they believe the Company's disclosure controls and procedures are
reasonably effective to ensure that information required to be disclosed by the
Company in the reports it files or submits under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in the
Securities and Exchange Commission's rules and forms. We intend to continue to
review and document our disclosure controls and procedures, including our
internal controls and procedures for financial
11
reporting, and we may from time to time make changes to the disclosure controls
and procedures to enhance their effectiveness and to ensure that our systems
evolve with our business.
There was no change in our internal control over financial reporting that
occurred during the period covered by this Quarterly Report on Form 10-Q that
has materially affected, or is reasonably likely to materially affect, our
internal control over financial reporting.
12
PART II OTHER INFORMATION
Item 1. Legal Proceedings.
The Company is party from time to time to certain legal proceedings and
claims that arise in the ordinary course of business. The Company does not
believe that any such litigation would have a material adverse effect on its
results of operation or financial condition.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None.
Item 3. Defaults upon Senior Securities.
None.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Item 5. Other Information.
On February 23, 2005, the Company entered into Amendment No. 5 to its
Credit Facility with JP Morgan Chase Bank, N.A., as Lead Arranger and
Administrative Agent. This Amendment added a new lender to the credit facility,
Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. and increased the total
committed amount under the credit facility to $75 million. The borrowings under
the credit facility remain collateralized by security interests in substantially
all of the Company's assets and remains subject to certain financial ratios
provided in the loan agreement.
Item 6. Exhibits.
The following are included as exhibits to this report:
Exhibit No. Description
10.19 Amendment No. 5 to Credit Facility, dated February 23, 2005 between the
Registrant and JP Morgan Chase Bank, N.A. as Lead Arranger and Administrative
Agent.*
31.1 Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the
Securities Exchange Act of 1934*
31.2 Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the
Securities Exchange Act of 1934*
32.1 Certifications of Chief Executive Officer and Chief Financial Officer
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002**
- -------------------------
* Filed herewith
** Furnished herewith
13
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934,
the registrant caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
EMPIRE RESOURCES, INC.
Dated: May 16, 2005 By: /s/ Sandra Kahn
----------------
Sandra Kahn
Chief Financial Officer
(signing both on behalf of the registrant
and in her capacity as Principal Financial
and Principal Accounting Officer)
14