UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, ~~2013~~2014

Commission File Number: 1-5415

A. M. CASTLE & CO.

(Exact name of registrant as specified in its charter)



Maryland		36-0879160
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

1420 Kensington Road, Suite 220, Oak Brook, Illinois		60523
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (847) 455-7111

Securities registered pursuant to Section 12(b) of the Act:



Title of each class		Name of each exchange on which registered
Common Stock - $0.01 par value		New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨ No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.

Yes ¨ No x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (check one):

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter is $~~275,431,074~~197,652,774.

The number of shares outstanding of the registrant’s common stock on February ~~28, 2014~~25, 2015 was ~~23,438,988~~23,558,670 shares.

DOCUMENTS INCORPORATED BY REFERENCE



Documents Incorporated by Reference		Applicable Part of Form 10-K
Portions of the registrant’s definitive Proxy Statement for the Annual Meeting of Stockholders to be held ~~April 24, 2014.~~at a time to be determined and announced in accordance with Securities Exchange Commission and New York Stock Exchange rules.		Part III

Disclosure Regarding Forward-Looking Statements

Information provided and statements contained in this report that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”), and the Private Securities Litigation Reform Act of 1995. Such forward-looking statements only speak as of the date of this report and the Company assumes no obligation to update the information included in this report. Such forward-looking statements include information concerning our possible or assumed future results of operations, including descriptions of our business strategy. These statements often include words such as “believe,” “expect,” “anticipate,” “intend,” “predict,” “plan,” or similar expressions. These statements are not guarantees of performance or results, and they involve risks, uncertainties, and assumptions. Although we believe that these forward-looking statements are based on reasonable assumptions, there are many factors that could affect our actual financial results or results of operations and could cause actual results to differ materially from those in the forward-looking statements, including those risk factors identified in Item 1A “Risk Factors” of this report. All future written and oral forward-looking statements by us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to above. Except as required by the federal securities laws, we do not have any obligations or intention to release publicly any revisions to any forward-looking statements to reflect events or circumstances in the future, to reflect the occurrence of unanticipated events or for any other reason.

INDUSTRY AND MARKET DATA

In this report, we rely on and refer to information and statistics regarding the metal service center industry and general manufacturing markets. We obtained this information and these statistics from sources other than us, such as Purchasing magazine and the Institute for Supply Management, which we have supplemented where necessary with information from publicly available sources and our own internal estimates. Although we have not independently verified such information, we have used these sources and estimates and believe them to be reliable.

PART I

ITEM 1 — Business

In this annual report on Form 10-K, “the Company,” “we” or “our” refer to A. M. Castle & Co., a Maryland corporation, and its subsidiaries included in the consolidated financial statements, except as otherwise indicated or as the context otherwise requires.

Business and Markets

Company Overview

The Company is a specialty metals ~~(87%~~(86% of net sales) and plastics ~~(13%~~(14% of net sales) distribution company serving customers on a global basis. The Company provides a broad range of products and value-added processing and supply chain services to a wide array of customers. The Company's metals customers are principally within the producer durable equipment, oil and gas, aerospace, heavy industrial equipment, industrial goods and construction equipment sectors of the global economy, and its plastics customers are primarily in the retail, marine and automotive ~~sectors of the global economy.~~sectors. Particular focus is placed on the aerospace, oil and gas, power generation, mining, heavy industrial equipment and manufacturing for metals and automotive, marine, office furniture and fixtures, safety products, life sciences applications, transportation and general manufacturing ~~industries.~~industries for plastics.

The Company’s corporate headquarters ~~are~~is located in Oak Brook, Illinois. The Company operates out of 4629 metals service centers located throughout North America ~~(42)~~(24), Europe (3) and Asia ~~(1).~~(2) and 18 plastics service centers located in the United States. The Company’s service centers hold inventory and process and distribute products to both local and export markets.

Industry and Markets

Service centers act as supply chain intermediaries between primary producers, which deal in bulk quantities in order to achieve economies of scale, and end-users in a variety of industries that require specialized products in significantly smaller quantities and forms. Service centers also manage the differences in lead times that exist in the supply chain. While original equipment manufacturers (“OEM”) and other customers often demand delivery within hours, the lead time required by primary producers can be as long as several months. Service centers also provide value to customers by aggregating purchasing, providing warehousing and distribution services to meet specific customer needs, including demanding delivery times and precise metal specifications.

The principal markets served by the Company are highly competitive. Competition is based on service, quality, processing capabilities, inventory availability, timely delivery, ability to provide supply chain solutions and price. The

Company competes in a highly fragmented industry. Competition in the various markets in which the Company participates comes from a large number of value-added metals processors and service centers on a regional and local basis, some of which have greater financial resources and some of which have more established brand names in the local markets served by the Company.

The Company also competes to a lesser extent with primary metals producers who typically sell to larger customers requiring shipments of large volumes of metal.

In order to capture scale efficiencies and remain competitive, many primary metal producers are consolidating their operations and focusing on their core production activities. These producers have increasingly outsourced metals distribution and inventory management to metals service centers. This process of outsourcing allows them to work with a relatively small number of intermediaries rather than many end customers. As a result, metals service centers, including the Company, are now providing a range of services for their customers, including metal purchasing, processing and supply chain solutions.

~~Recent Acquisitions~~

During December 2011, the Company completed its acquisition (the “Acquisition”) of Tube Supply, Inc. (“Tube Supply”), which has expanded the Company’s product offerings in the oil and gas industry. The results of Tube Supply are included in the Company’s Metals segment.

Procurement

The Company purchases metals and plastics from many producers. Material is purchased in large lots and stocked at its service centers until sold, usually in smaller quantities and typically with some value-added processing services performed. The Company’s ability to provide quick delivery of a wide variety of specialty metals and plastic products, along with its processing capabilities and supply chain management solutions, allows customers to lower their own inventory investment by reducing their need to order the large quantities required by producers and their need to perform additional material processing services. Some of the Company’s purchases are covered by long-term contracts and commitments, which generally have corresponding customer sales agreements.

Orders are primarily filled with materials shipped from Company stock. The materials required to fill the balance of sales are obtained from other sources, such as direct mill shipments to customers or purchases from other distributors. Deliveries are made principally by the Company’s fleet contracted through third party logistics providers. Common carrier delivery is used in areas not serviced directly by the Company’s fleet.

As of December 31, ~~2013,~~2014, the Company had ~~1,624~~1,667 full-time employees. Of these ~~approximately 230 are~~full-time employees, 262 were represented by ~~collective bargaining units, principally~~ the United Steelworkers of ~~America.~~America under collective bargaining agreements.

Business Segments

The Company distributes and performs processing on both metals and plastics. Although the distribution processes are similar, the customer markets, supplier bases and types of products are different. Additionally, the Company’s Chief Executive Officer, the chief operating decision-maker, reviews and manages these two businesses separately. As such, these businesses are considered reportable segments and are reported accordingly in the Company’s various public filings. Neither of the Company’s reportable segments has any unusual working capital requirements.

In the last three years, the percentages of total sales of the two segments were as follows:


	2013		2012		2011		2014		2013		2012
Metals	87	%	90	%	90	%	86	%	87	%	90	%
Plastics	13	%	10	%	10	%	14	%	13	%	10	%
	100	%	100	%	100	%	100	%	100	%	100	%

Metals Segment

with bar saws, plate saws, oxygen and plasma arc flame cutting machinery, trepanning machinery, boring machinery, honing equipment, water-jet cutting equipment, stress relieving and annealing furnaces, surface grinding equipment, and sheet shearing equipment.

The Company’s customer base is well diversified and therefore, the Company does not have dependence upon any single customer, or a few customers. Our customer base includes many Fortune 500 companies as well as thousands of medium and smaller sized firms.

The Company’s broad network of locations provides same or next-day delivery to most of the segment’s markets, and two-day delivery to substantially all of the remaining markets.

Plastics Segment

The Plastics segment’s diverse customer base consists of companies in the retail (point-of-purchase), automotive, marine, office furniture and fixtures, safety products, life sciences applications, and general manufacturing industries. TPI has locations in the upper northeast, southeast and midwest regions of the U.S. from which it services a wide variety of users of industrial plastics.

Joint Venture

The Company holds a 50% joint venture interest in Kreher Steel Company, LLC (“Kreher”), a national distributor and processor of carbon and alloy steel bar products, headquartered in Melrose Park, Illinois. The Company’s equity in the earnings of this joint venture is reported separately in the Company’s consolidated statements of operations. Kreher is considered a significant ~~subsidiary~~ under Rule 3-09 of Regulation S-X. Therefore, its stand-alone financial statements are included in this filing.

Access to SEC Filings

The Company makes available free of charge on or through its Web site at www.amcastle.com the annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with or furnished to the U.S. Securities and Exchange Commission (the “SEC”). Information on our website does not constitute part of this annual report on Form 10-K.

ITEM 1A — Risk Factors

(~~Amounts~~Dollar amounts in millions, except per share data)

Our business, financial condition, results of operations, and cash flows are subject to various risks, many of which are not exclusively within our control that may cause actual performance to differ materially from historical or projected future performance. The risks described below are not the only risks we face. Any of the following risks, as well as other risks and uncertainties not currently known to us or that we currently consider to be immaterial, could materially and adversely affect our business, financial condition, results of operations, or cash flows.

Our future operating results depend on the volatility of the prices of metals and plastics, which could cause our results to be adversely affected.

The prices we pay for raw materials, both metals and plastics, and the prices we charge for products may fluctuate depending on many factors, including general economic conditions (both domestic and international), competition, production levels, import duties and other trade restrictions and currency fluctuations. To the extent metals and plastics prices decline, we would generally expect lower sales, pricing and possibly lower net income. Depending on the timing of the price changes and to the extent we are not able to pass on to our customers any increases in our raw materials prices, our operating results may be adversely affected. In addition, because we maintain substantial inventories of metals and plastics in order to meet short lead-times and the just-in-time delivery requirements of our customers, a reduction in our selling prices could result in lower profitability or, in some cases, losses, either of which could adversely impact our ability to remain in compliance with certain financial covenants contained in our debt instruments, as well as result in us incurring impairment charges.

We service industries that are highly cyclical, and any downturn in our customers’ industries could reduce our revenue and profitability.

Many of our products are sold to customers in industries that experience significant fluctuations in demand based on economic conditions, energy prices, consumer demand, availability of adequate credit and financing, customer inventory levels, changes in governmental policies and other factors beyond our control. As a result of this volatility in the industries we serve, when one or more of our customers' industries experiences a decline, we may have difficulty increasing or maintaining our level of sales or profitability if we are not able to divert sales of our products to customers in other industries. We have made a strategic decision to focus sales resources on certain industries, specifically the aerospace, oil and gas, heavy equipment, machine tools and general industrial equipment industries. A downturn in these industries has had, and may in the future continue to have, an adverse effect on our operating results. We are also particularly sensitive to market trends in the manufacturing ~~sector~~and oil and gas sectors of the North American economy.

A portion of our sales, particularly in the aerospace industry, are related to contracts awarded to our customers under various U.S. Government defense-related programs. Significant changes in defense spending, or in government priorities and requirements could impact the funding, or the timing of funding, of those defense programs, which could negatively impact our results of operations and financial condition. The level of U.S. spending for defense, alternative energy and other programs to which such funding is allocated, is subject to periodic congressional appropriation actions, including the sequestration of appropriations in fiscal ~~year~~years 2013 and after, under the Budget Control Act of 2011, and is subject to change at any time.

Our industry is highly competitive, which may force us to lower our prices and may have an adverse effect on our operating results.

The principal markets that we serve are highly competitive. Competition is based principally on price, service, quality, processing capabilities, inventory availability and timely delivery. We compete in a highly fragmented industry. Competition in the various markets in which we participate comes from a large number of value-added metals processors and service centers on a regional and local basis, some of which have greater financial resources than we do and some of which have more established brand names in the local markets we serve. We also compete to a lesser extent with primary metals producers who typically sell to very large customers requiring shipments of large volumes of metal. Increased competition could force us to lower our prices or to offer increased services at a higher cost to us, which could have an adverse effect on our operating results.

Our operating results are subject to the seasonal nature of our customers’ businesses.

A portion of our customers experience seasonal slowdowns. Historically, our revenues in the months of July, November and December have been lower than in other months because of a reduced number of shipping days and holiday or vacation closures for some customers. Consequently, our sales in the first two quarters of the year are usually higher than in the third and fourth quarters. As a result, analysts and investors may inaccurately estimate the effects of seasonality on our operating results in one or more future quarters and, consequently, our operating results may fall below expectations.

~~Disruptions or shortages in the supply of raw materials could adversely affect our operating results and our ability to meet our customers’ demands.~~

Our business requires materials that are sourced from third party suppliers. If for any reason our primary suppliers of metals should curtail or discontinue their delivery of raw materials to us at competitive prices and in a timely manner, our operating results could suffer. Unforeseen disruptions in our supply bases could materially impact our ability to deliver products to customers. The number of available suppliers could be reduced by factors such as industry consolidation and bankruptcies affecting metals and plastics producers, or suppliers may be unwilling or unable to meet our demand due to industry supply conditions. If we are unable to obtain sufficient amounts of raw materials from our traditional suppliers, we may not be able to obtain such raw materials from alternative sources at competitive prices to meet our delivery schedules, which could have an adverse impact on our operating results. To the extent we have quoted prices to customers and accepted orders for products prior to purchasing necessary raw materials, or have existing contracts, we may be unable to raise the price of products to cover all or part of the increased cost of the raw materials to our customers.

In some cases the availability of raw materials requires long lead times. As a result, we may experience delays or shortages in the supply of raw materials. If unable to obtain adequate and timely deliveries of required raw materials, we may be unable to timely supply customers with sufficient quantities of products. This could cause us to lose sales, incur additional costs, or suffer harm to our reputation.

Increases in freight and energy prices would increase our operating costs and we may be unable to pass these increases on to our customers in the form of higher prices, which may adversely affect our operating results.

We use energy to process and transport our products. The prices for and availability of energy resources are subject to volatile market conditions, which are affected by political, economic and regulatory factors beyond our control. Our operating costs increase if energy costs, including electricity, diesel fuel and natural gas, rise. During periods of higher freight and energy costs, we may not be able to recover our operating cost increases through price increases without reducing demand for our products. In addition, we typically do not hedge our exposure to higher freight or energy prices.

~~We rely upon our suppliers as to the specifications of the metals we purchase from them.~~

We rely on mill certifications that attest to the physical and chemical specifications of the metal received from our suppliers for resale and generally, consistent with industry practice, do not undertake independent testing of such metals. We rely on our customers to notify us of any metal that does not conform to the specifications certified by the supplying mill. Although our primary sources of products have been domestic mills, we have and will continue to purchase product from foreign suppliers when we believe it is appropriate. In the event that metal purchased from domestic suppliers is deemed to not meet quality specifications as set forth in the mill certifications or customer specifications, we generally have recourse against these suppliers for both the cost of the products purchased and possible claims from our customers. However, such recourse will not compensate us for the damage to our reputation that may arise from sub-standard products and possible losses of customers. Moreover, there is a greater level of risk that similar recourse will not be available to us in the event of claims by our customers related to products from foreign suppliers that do not meet the specifications set forth in the mill certifications. In such circumstances, we may be at greater risk of loss for claims for which we do not carry, or do not carry sufficient, insurance.

~~We operate in international markets, which expose us to a number of risks.~~

Although a substantial majority of our business activity takes place in the United States, we serve and operate in certain international markets, which expose us to political, economic and currency related risks, including the following:

~~potential for adverse change in the local political or social climate or in government policies, laws and regulations;~~

~~difficulty staffing and managing geographically diverse operations and the application of foreign labor regulations;~~

~~restrictions on imports and exports or sources of supply;~~

~~currency exchange rate risk; and~~

~~change in duties and taxes.~~

We operate in Canada, Mexico, France, and the United Kingdom, with limited operations in Singapore and China. An act of war or terrorism or major pandemic event could disrupt international shipping schedules, cause additional delays in importing our products into the United States or increase the costs required to do so. In addition, acts of crime or violence in these international markets (for example, in Mexico) could adversely affect our operating results. Fluctuations in the value of the U.S. dollar versus foreign currencies could reduce the value of these assets as reported in our financial statements, which could reduce our stockholders' equity. If we do not adequately anticipate and respond to these risks and the other risks inherent in international operations, it could have a material impact on our operating results.

~~Our business could be adversely affected by a disruption to our primary distribution hub.~~

Our largest facility, in Franklin Park, Illinois, serves as a primary distribution center that ships product to our other facilities as well as external customers. Our business could be adversely impacted by a major disruption at this facility due to unforeseen developments occurring in or around the facility, such as:

~~damage to or inoperability of our warehouse or related systems;~~

~~a prolonged power or telecommunication failure;~~

~~a natural disaster, environmental or public health issue; or~~

an airplane crash or act of war or terrorism on-site or nearby as the facility is located within seven miles of O'Hare International Airport (a major U.S. airport) and lies below certain take-off and landing flight patterns.

~~A prolonged disruption of the services and capabilities of our Franklin Park facility and operation could adversely impact our operating results.~~

~~Damage to or a disruption in our information technology systems could impact our ability to conduct business and/or report our financial performance.~~

~~Difficulties associated with the design and implementation of our ERP system could adversely affect our business, our customer service and our operating results.~~

We rely primarily on one information technology system to provide inventory availability to our sales and operating personnel, improve customer service through better order and product reference data and monitor operating results. Difficulties associated with upgrades or integration with new systems could lead to business interruption that could harm our reputation, increase our operating costs and decrease profitability. In addition, any significant disruption relating to our current information technology systems, whether due from such things as fire, flood, tornado and other natural disasters, power loss, network failures, loss of data, security breaches and computer viruses, or otherwise, may have an adverse effect on our business, our operating results and our ability to report our financial performance in a timely manner.

~~A portion of our workforce is represented by collective bargaining units, which may lead to work stoppages.~~

As of December 31, 2013, approximately 17% of our U.S. employees were represented by unions under collective bargaining agreements, including hourly warehouse employees at our primary distribution center in Franklin Park, Illinois. As these agreements expire, there can be no assurance that we will succeed in concluding collective bargaining agreements with the union to replace those that expire. Although we believe that our labor relations have generally been satisfactory, we cannot predict how stable our relationships with these labor organizations will be or whether we will be able to meet union requirements without impacting our operating results and financial condition. The unions may also limit our flexibility in dealing with our workforce. Our collective bargaining agreement with the Teamsters, which covers approximately 20 employees at our Cleveland, Ohio facility, will expire March 31, 2014. Our collective bargaining agreement with United Steelworkers, which covers approximately 230 employees at our Franklin Park, Illinois and Cleveland, Ohio facilities, will expire September 30, 2014. Although we anticipate renewing these agreements, work stoppages and instability in our union relationships could negatively impact the timely processing and shipment of our products, which could strain relationships with customers and adversely affect our operating results.

~~An impairment or restructuring charge could have an adverse effect on our operating results.~~

We continue to evaluate opportunities to reduce costs and improve operating performance. These actions could result in restructuring and related charges, including but not limited to asset impairments, employee termination costs, charges for pension benefits, and pension curtailments that could be significant, which could adversely affect our financial condition and results of operations.

We have a significant amount of long-lived assets, including goodwill and intangible assets. We review the recoverability of goodwill annually or whenever significant events or changes occur which might impair the recovery of recorded costs, making certain assumptions regarding future operating performance. The results of our most recent annual impairment test of goodwill indicates that there is approximately $64.9 million (12.6%) and $9.8 million (23.2%) of excess estimated fair-value over carrying value for the Metals and Plastics reporting units, respectively. We review the recoverability of definite lived intangible assets and other long-lived assets whenever significant events or changes occur which might impair the recovery of recorded costs, making certain assumptions regarding future operating performance. The results of these calculations may be affected by the current or further declines in the market conditions for our products, as well as interest rates and general economic conditions. If impairment is determined to exist, we will incur impairment losses, which will have an adverse effect on our operating results and our ability to remain in compliance with certain financial covenants contained in our debt instruments.

~~We may not achieve all of the expected benefits from our restructuring and performance enhancement initiatives.~~

In 2013, we completed our restructuring activities that were announced in January 2013 in our metals business, including organizational restructuring, warehouse realignments and performance improvement programs. We expect these measures will result in improvements to annualized operating profits of approximately $33.0 million beginning in 2014. In addition, we continue to evaluate additional options to improve efficiency and performance of our operations and have identified additional plant consolidations that started in 2013 and will continue through 2014. We have made certain assumptions in estimating the anticipated impact of our restructuring and performance enhancement initiatives. These assumptions may turn out to be incorrect due to a variety of factors. In addition, our ability to realize the expected benefits from these initiatives is subject to significant business, economic, and competitive uncertainties and contingencies, many of which are beyond our control. Some of our cost saving measures may not have the impact on

our operating profitability that we currently project. If we are unsuccessful in implementing these initiatives or if we do not achieve our expected results, our results of operations and cash flows could be materially adversely affected.

~~We may not be able to realize the benefits we anticipate from our acquisitions.~~

We have acquired businesses and intend to continue to seek attractive opportunities to acquire other businesses in the future. Achieving the benefits of these acquisitions depends on the timely, efficient and successful execution of a number of post-acquisition events, including our integration of the acquired businesses. Factors that could affect our ability to achieve the benefits we anticipate from our acquisitions include:

~~difficulties in integrating and managing personnel, financial reporting and other systems used by the acquired businesses;~~

~~the failure of the acquired businesses to perform in accordance with our expectations;~~

~~failure to achieve anticipated synergies between our business units and the acquired businesses;~~

~~the loss of the acquired businesses' customers; and~~

~~cyclicality of business.~~

The presence of any of the above factors individually or in combination could result in future impairment charges against the assets of the acquired businesses. If the acquired businesses do not operate as we anticipate, it could adversely affect our operating results and financial condition. As a result, there can be no assurance that the acquisitions will be successful or will not, in fact, adversely affect our business.

Our substantial level of indebtedness could adversely affect our financial condition and prevent us from fulfilling our obligations under our debt instruments.

We have substantial debt service obligations. As of December 31, ~~2013,~~2014, we had approximately ~~$267.5~~$326.7 million of total debt outstanding, excluding capital lease obligations of $~~1.0~~1.3 million, of which ~~$210.0~~$269.2 million is secured. As of December 31, ~~2013, the Company~~2014, we had approximately ~~$90.3~~$41.2 million of ~~availability~~additional unrestricted borrowing capacity under ~~its~~our revolving credit facility. In December 2014, we obtained an extension on our revolving credit facility, extending its maturity date from December 15, 2015 to December 10, 2019 (or 91 days prior to the maturity date of our Senior Secured Notes or Convertible Notes if they have not been refinanced). In January 2014, ~~the Company~~we partially exercised the accordion option under ~~its~~our revolving credit facility to increase the aggregate commitments by $25.0 million. As a result, ~~the Company's~~our borrowing capacity increased from $100.0 million to $125.0 ~~million, and~~million. We maintain the ~~Company maintains the ability~~option to exercise the accordion for an additional $25.0 million of aggregate commitments in the ~~future.~~future, assuming we meet certain thresholds for incurring additional debt. Subject to restrictions contained in the debt instruments, we may incur additional indebtedness.

Our substantial level of indebtedness could have significant effects on our business, including the following:

it may be more difficult for us to satisfy our financial obligations;

our ability to obtain additional financing for working capital, capital expenditures, strategic acquisitions or general corporate purposes may be impaired;

we must use a substantial portion of our cash flow from operations to pay interest on our indebtedness, which will reduce the funds available to use for operations and other ~~purposes;~~purposes, including potentially accretive acquisitions;

our ability to fund a change of control offer under our debt instruments may be limited;

our substantial level of indebtedness could place us at a competitive disadvantage compared to our competitors that may have proportionately less debt;

our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate may be limited; and

our substantial level of indebtedness may make us more vulnerable to economic downturns and adverse developments in our business.

We expect to obtain the funds to pay our expenses and to repay our indebtedness primarily from our operations and, in the case of our indebtedness, from the refinancing thereof. Our ability to meet our expenses and make these payments therefore depends on our future performance, which will be affected by financial, business, economic and other factors, many of which we cannot control. Our business may not generate sufficient cash flow from operations in the future, and our currently anticipated growth in revenue and cash flow may not be realized, either or both of which could result in our being unable to repay indebtedness or to fund other liquidity needs. If we do not have enough funds, we may be required to refinance all or part of our then existing debt, sell assets or borrow more funds, which we may not be able to accomplish on terms acceptable to us, or at all. In addition, the terms of existing or future debt agreements may restrict us from pursuing any of these alternatives which could have an adverse effect on our financial condition or liquidity.

During ~~2013,~~2014, our 12.75% Senior Secured Notes ~~were~~debt rating was downgraded by ~~each of the two national~~Moody's Investor Services from Caa1 to Caa2, and our outlook was revised to negative by Standard & Poor's and Moody's Investor Services. In February 2015, Standard & Poor's downgraded our senior debt rating ~~agencies. These~~from B- to CCC+. The downgrades and outlook revisions, or any future downgrades and/or outlook revisions, could negatively impact our ability to refinance our existing debt and/or increase the cost to refinance our debt.

We may not be able to generate sufficient cash to service all of our existing debt service obligations, and may be forced to take other actions to satisfy our obligations under our debt agreements, which may not be successful.

Our annual debt service obligations until December ~~2015,~~2016, when our ~~revolving credit facility is~~Senior Secured Notes are scheduled to mature, will be primarily limited to interest payments on our outstanding debt securities, with an aggregate principal amount of $267.5 million, and on ~~future~~ borrowings under our ~~$100.0~~$125.0 million revolving credit facility, ~~(which was increased to $125.0 million in January 2014),~~ if any. We had no$59.2 million of borrowings outstanding under the revolving credit facility as of December 31, ~~2013.~~2014. Our ability to make scheduled payments on or to refinance our debt obligations depends on our future financial condition and operating performance, which are subject to prevailing economic and competitive conditions and to certain financial, business and other factors beyond our control. Our business may not generate sufficient cash flow from operations in the future and our currently anticipated levels of revenue and cash flow may not be realized, ~~either or both~~any of which could result in our being unable to repay indebtedness or to fund other liquidity needs. Therefore, we may not be able to maintain or realize a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness.

If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay investments, ~~and~~ capital expenditures or potentially accretive acquisitions, sell assets, seek additional capital or restructure or refinance our indebtedness. Our ability to restructure or refinance our debt will depend on the condition of the capital markets and our financial condition at such time. Any refinancing of our debt could be at higher interest rates and may require us to comply with more onerous borrowing covenants, which could further restrict our business operations. The terms of existing or future debt instruments may restrict us from adopting some of these alternatives. In addition, any failure to make payments of principal and interest on our outstanding indebtedness on a timely basis would likely result in a reduction of our credit rating, which could harm our ability to incur additional ~~indebtedness.~~indebtedness or the terms thereof. These alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations which could have an adverse effect on our financial condition or liquidity.

Our debt instruments impose significant operating and financial restrictions, which may prevent us from pursuing certain business opportunities and taking certain actions and our failure to comply with the covenants contained in our debt instruments could result in an event of default that could adversely affect our operating results.

Our debt agreements impose, and future debt agreements may impose, operating and financial restrictions on us. These restrictions limit or prohibit, among other things, our ability to:

incur additional indebtedness unless certain financial tests are satisfied or issue disqualified capital stock;

pay dividends, redeem subordinated debt or make other restricted payments;

make certain investments or acquisitions;

issue stock of subsidiaries;

grant or permit certain liens on our assets;

enter into certain transactions with affiliates;

merge, consolidate or transfer substantially all of our assets;

incur dividend or other payment restrictions affecting certain of our subsidiaries;

transfer, sell or acquire assets, including capital stock of our subsidiaries; and

change the business we conduct.

These covenants could adversely affect our ability to finance our future operations or capital needs, withstand a future downturn in our business or the economy in general, engage in business activities, including future opportunities that may be in our interest, and plan for or react to market conditions or otherwise execute our business strategies. A breach of any of these covenants could result in a default in respect of the related indebtedness. If a default occurs, the relevant lenders or holders of such indebtedness could elect to declare the indebtedness, together with accrued interest and other fees, to be immediately due and payable and proceed against any collateral securing that indebtedness. If the maturity of our indebtedness is accelerated, we may not have sufficient cash resources to satisfy our debt obligations and may not be able to continue our operations as planned.

An additional impairment or restructuring charge could have an adverse effect on our operating results.

We continue to evaluate opportunities to reduce costs and improve operating performance. These actions could result in restructuring and related charges, including but not limited to asset impairments, employee termination costs, charges for pension benefits, and pension curtailments, which could be significant and could adversely affect our financial condition and results of operations.

We have a significant amount of long-lived assets, including goodwill and intangible assets. We review the recoverability of goodwill annually or whenever significant events or changes occur that might impair the recovery of recorded costs, making certain assumptions regarding future operating performance. We review the recoverability of definite lived intangible assets and other long-lived assets whenever significant events or changes occur which might impair the recovery of recorded costs, making certain assumptions regarding future operating performance. The results of these calculations may be affected by the current demand and any decline in market conditions for our products, as well as interest rates and general economic conditions. If impairment is determined to exist, we will incur impairment losses, which may have an adverse effect on our operating results and our ability to remain in compliance with certain financial covenants contained in our debt instruments.

We recorded a $56.2 million goodwill impairment charge in 2014. During the second quarter of 2014, we determined that an interim impairment test of our Metals segment goodwill was necessary. The results of the May 31, 2014 interim impairment analysis indicated that the Metals segment goodwill was impaired, and we recorded a $56.2 million non-cash impairment charge in the second quarter of 2014 to eliminate the Metals segment goodwill entirely. The results of our most recent annual impairment test of goodwill indicates that as of December 1, 2014 there is approximately $9.8 million (21.0%) of excess estimated fair-value over carrying value for the Plastics reporting unit.

Disruptions or shortages in the supply of raw materials could adversely affect our operating results and our ability to meet our customers’ demands.

our traditional suppliers, we may not be able to obtain such raw materials from alternative sources at competitive prices to meet our delivery schedules, which could have an adverse impact on our operating results. To the extent we have quoted prices to customers and accepted orders for products prior to purchasing necessary raw materials, or have existing contracts, we may be unable to raise the price of products to cover all or part of the increased cost of the raw materials to our customers.

We operate in international markets, which expose us to a number of risks.

Although a substantial majority of our business activity takes place in the United States, we serve and operate in certain international markets, which exposes us to political, economic and currency related risks, including the following:

potential for adverse change in the local political or social climate or in government policies, laws and regulations;

difficulty staffing and managing geographically diverse operations and the application of foreign labor regulations;

restrictions on imports and exports or sources of supply;

currency exchange rate risk; and

change in duties and taxes.

In addition to the United States, we operate in Canada, Mexico, France, the United Kingdom, Singapore, and China. An act of war or terrorism or major pandemic event could disrupt international shipping schedules, cause additional delays in importing or exporting products into or out of any of these countries, including the United States, or increase the costs required to do so. In addition, acts of crime or violence in these international markets could adversely affect our operating results. Fluctuations in the value of the U.S. dollar versus foreign currencies could reduce the value of these assets as reported in our financial statements, which could reduce our stockholders' equity. If we do not adequately anticipate and respond to these risks and the other risks inherent in international operations, it could have a material adverse impact on our operating results.

A portion of our workforce is represented by collective bargaining units, which may lead to work stoppages.

As of December 31, 2014, approximately 20% of our U.S. employees were represented by the United Steelworkers of America ("USW") under collective bargaining agreements, including hourly warehouse employees at two of our primary distribution centers in Franklin Park, Illinois and Cleveland, Ohio. As these agreements expire, there can be no assurance that we will succeed in concluding collective bargaining agreements with the USW to replace those that expire. Although we believe that our labor relations have generally been satisfactory, we cannot predict how stable our relationships with the USW will be or whether we will be able to meet the USW requirements without impacting our operating results and financial condition. The USW may also limit our flexibility in dealing with our workforce. Work stoppages and instability in our relationship with the USW could negatively impact the timely processing and shipment of our products, which could strain relationships with customers or suppliers and adversely affect our operating results. On October 1, 2014, we entered into a four year collective bargaining agreement with the USW, which covers approximately 235 employees at our Franklin Park, Illinois and Cleveland, Ohio facilities. Approximately 27 employees at our Hammond, Indiana facility are covered by a separate collective bargaining agreement with the USW through 2016.

We rely upon our suppliers as to the specifications of the metals we purchase from them.

We rely on mill or supplier certifications that attest to the physical and chemical specifications of the metals or plastics received from our suppliers for resale and generally, consistent with industry practice, do not undertake independent testing of such metals or plastics. We rely on our customers to notify us of any product that does not conform to the

specifications certified by the supplier. Although our primary sources of products have been domestic suppliers, we have and will continue to purchase product from foreign suppliers when we believe it is appropriate. In the event that metal purchased from domestic suppliers is deemed to not meet quality specifications as set forth in the mill or supplier certifications or customer specifications, we generally have recourse against these suppliers for both the cost of the products purchased and possible claims from our customers. However, such recourse will not compensate us for the damage to our reputation that may arise from sub-standard products and possible losses of customers. Moreover, there is a greater level of risk that similar recourse will not be available to us in the event of claims by our customers related to products from foreign suppliers that do not meet the specifications set forth in the mill or supplier certifications. In such circumstances, we may be at greater risk of loss for claims for which we do not carry, or do not carry sufficient, insurance.

Our business could be adversely affected by a disruption to our primary distribution hubs.

Our largest facilities, in Franklin Park, Illinois, Cleveland, Ohio, Hammond, Indiana, and Houston Texas, serve as primary distribution centers that ship product to our other facilities as well as external customers. Our business could be adversely impacted by a major disruption at any of these facilities due to unforeseen developments occurring in or around the facility, such as:

damage to or inoperability of our warehouse or related systems;

a prolonged power or telecommunication failure;

a natural disaster, environmental or public health issue; or

an airplane crash or act of war or terrorism on-site or nearby (for example at the Franklin Park facility, which is located within seven miles of O'Hare International Airport (a major U.S. airport) and lies below certain take-off and landing flight patterns).

A prolonged disruption of the services and capabilities of these or other of our facilities could adversely impact our operating results.

Damage to or a disruption in our information technology systems could impact our ability to conduct business and/or report our financial performance.

Difficulties associated with the design and implementation of our ERP system could adversely affect our business, our customer service and our operating results.

We rely primarily on one information technology system to provide inventory availability to our sales and operating personnel, improve customer service through better order and product reference data and monitor operating results. Difficulties associated with upgrades or integration with new systems could lead to business interruption that could harm our reputation, increase our operating costs and decrease profitability. In addition, any significant disruption relating to our current information technology systems, whether resulting from such things as fire, flood, tornado and other natural disasters, power loss, network failures, loss of data, security breaches and computer viruses, or otherwise, may have an adverse effect on our business, our operating results and our ability to report our financial performance in a timely manner.

The success of our business depends on the security of our networks and, in part, on the security of the network infrastructures of our third-party vendors. In connection with conducting our business in the ordinary course, we store and transmit limited amounts of customer, vendor, and employee information, including account or credit card information, and other personally identifiable information. Unauthorized or inappropriate access to, or use of, our networks, computer systems or services, whether intentional, unintentional or as a result of criminal activity, could potentially jeopardize the security of this confidential information. A number of other companies have publicly disclosed breaches of their security, some of which have involved sophisticated and highly targeted attacks on portions of their networks. Because the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently and often are not recognized until launched against a target, we may be unable to anticipate these techniques or to implement adequate preventative measures. If an actual or perceived breach of our security occurs, the perception of the effectiveness of our security measures could be harmed and we could lose employees, customers, or vendors. A party that is able to circumvent our security measures could misappropriate our proprietary information or the information of our customers, vendors, or employees, cause interruption in our operations, or damage our computers or those of our customers or vendors.

We may need to expend significant resources to protect against security breaches or to address problems caused by breaches. Security breaches, including any breach related to us or the parties with which we have commercial relationships, could damage our reputation and expose us to a risk of loss, litigation, and possible liability. We cannot give assurance that the security measures we take will be effective in preventing these types of activities. We also

cannot give assurance that the security measures of our third-party vendors, including network providers, providers of customer and vendor support services, and other vendors, will be adequate. In addition to potential legal liability, these activities may adversely impact our reputation or our revenues and may interfere with our ability to provide our products and services, all of which could adversely impact our business.

We may not achieve all of the expected benefits from our restructuring and performance enhancement initiatives.

In 2013, we completed our restructuring activities that were announced in January 2013 in our Metals segment, including organizational restructuring, warehouse realignments and performance improvement programs. We continue to evaluate additional options to improve the efficiency and performance of our operations. We identified additional plant consolidations that started in 2013 and continued through 2014 and additional organizational restructuring that resulted in workforce reductions in 2014. We have made certain assumptions in estimating the anticipated impact of these restructuring and performance enhancement initiatives. These assumptions may turn out to be incorrect due to a variety of factors. In addition, our ability to realize the expected benefits from these initiatives is subject to significant business, economic, and competitive uncertainties and contingencies, many of which are beyond our control. Some of our cost saving measures may not have the impact on our operating profitability that we currently project. If we are unsuccessful in implementing these initiatives or if we do not achieve our expected results, our results of operations and cash flows could be materially adversely affected.

Ownership of our stock is concentrated, which may limit stockholders’ ability to influence corporate matters.

As of December 31, 2014, based on filings made with the SEC and other information made available to us as of that date, we believe two of our directors, Jonathan B. Mellin and Reuben S. Donnelley, as general partners of W. B. & Co., may be deemed to beneficially own approximately 23% of our common stock. Additionally, from time to time, the Company has experienced concentrations of ownership among institutional investors and/or hedge funds. Accordingly, Mr. Mellin and Mr. Donnelley and their affiliates, and/or any other concentrated ownership interests, may have the voting power to substantially control the outcome of matters requiring a stockholder vote including the election of directors and the approval of significant corporate matters. Such a concentration of control could adversely affect the market price of our common stock or prevent a change in control or other business combinations that might be beneficial to us.

We may not have the cash necessary to satisfy our cash obligations under our Convertible Notes.

As of December 31, ~~2013,~~2014, we had approximately $57.5 million of aggregate principal amount outstanding under the Convertible Notes. The Convertible Notes bear cash interest semiannually at a rate of 7.0% per year, and mature on December 15, 2017. Upon the occurrence of a fundamental change (as defined in the indenture for the Convertible Notes), we may be required to repurchase some or all of the Convertible Notes for cash at a repurchase price equal to 100% of the principal amount of the Convertible Notes being repurchased, plus any accrued and unpaid interest up to but excluding the relevant fundamental change repurchase date. We may not have sufficient funds to satisfy such cash obligations and, in such circumstances, may not be able to arrange the necessary financing on favorable terms or at all. In addition, our ability to satisfy such cash obligations will be restricted pursuant to covenants contained in the indenture for the Convertible Notes and will be permitted to be paid only in limited circumstances. We may also be limited in our ability to satisfy such cash obligations by applicable law or the terms of other instruments governing our indebtedness. Our inability to make cash payments to satisfy our obligations described above would trigger an event of default under the Convertible Notes, which in turn could constitute an event of default under any of our outstanding indebtedness, thereby resulting in the acceleration of such indebtedness, the prepayment of which could further restrict our ability to satisfy such cash obligations.

The conditional conversion features of our Convertible Notes, if triggered, may adversely affect our financial condition and operating results.

In the event the conditional conversion features of the Convertible Notes are triggered, holders of the Convertible Notes will be entitled to convert the Convertible Notes at any time during specified periods at their option. If one or more holders elect to convert their Convertible Notes, and we elect or are deemed to have elected cash settlement or combination settlement, we would be required to pay cash to satisfy all or a portion of our conversion obligation for such Convertible Notes, which could adversely affect our liquidity. Even if holders do not elect to convert their Convertible Notes, in the absence of sufficient availability under the revolving credit facility, we could be required under applicable accounting guidance to reclassify all or a portion of the outstanding principal of the Convertible Notes as a current rather than long-term liability. The reclassification of all or a portion of the outstanding principal to a current liability would result in a material reduction of our net working capital.

We are vulnerable to interest rate fluctuations on our indebtedness, which could hurt our operating results.

We are exposed to various interest rate risks that arise in the normal course of business. We finance our operations with fixed and variable rate borrowings. Market risk arises from changes in variable interest rates. Under our revolving credit facility, our interest rate on borrowings is subject to changes based on fluctuations in the LIBOR and prime rates of interest. If interest rates significantly increase, we could be unable to service our debt which could have an adverse effect on our operating results or liquidity.

Commodity hedging transactions may expose us to loss or limit our potential gains.

We have entered into certain fixed price sales contracts with customers which expose us to risks associated with fluctuations in commodity prices. As part of our risk management program, we may use financial instruments from time-to-time to mitigate all or portions of these risks, including commodity futures, forwards or other derivative instruments. While intended to reduce the effects of the commodity price fluctuations, these transactions may limit our potential gains or expose us to losses. Also, should our counterparties to such transactions fail to honor their obligations due to financial distress we would be exposed to potential losses or the inability to recover anticipated gains from these transactions.

We could incur substantial costs in order to comply with, or to address any violations under, environmental and employee health and safety laws, which could adversely affect our operating results.

Our operations are subject to various environmental statutes and regulations, including laws and regulations governing materials we ~~use.~~use and our facilities. In addition, certain of our operations are subject to international, federal, state and local environmental laws and regulations that impose limitations on the discharge of pollutants into the air and water and establish standards for the treatment, storage and disposal of solid and hazardous wastes. Our operations are also subject to various employee safety and health laws and regulations, including those concerning occupational injury and illness, employee exposure to hazardous materials and employee complaints. Certain of our facilities are located in industrial areas, have a history of heavy industrial use and have been in operation for many years and, over time, we and other predecessor operators of these facilities have generated, used, handled and disposed of hazardous and other regulated wastes. Currently unknown cleanup obligations at these facilities, or at off-site locations at which materials from our operations were disposed, could result in future expenditures that cannot be currently quantified but which could have ana material adverse effect on our financial condition, liquidity or operating results.

We may face risks associated with current or future litigation and claims.

From time to time, we are involved in a variety of lawsuits, claims and other proceedings relating to the conduct of our business. These suits concern issues including contract disputes, employment actions, employee benefits, taxes, environmental, health and safety, personal injury and product liability matters. Due to the uncertainties of litigation, we can give no assurance that we will prevail on all claims made against us in the lawsuits that we currently face or that additional claims will not be made against us in the future. While it is not feasible to predict the outcome of all pending lawsuits and claims, we do not believe that the disposition of any such pending matters is likely to have ana materially adverse effect on our financial condition or liquidity, although the resolution in any reporting period of one of more of these matters could have an adverse effect on our operating results for that period. Also, we can give no assurance that any other lawsuits or claims brought in the future will not have an adverse effect on our financial condition, liquidity or operating results.

Potential environmental legislative and regulatory actions could impose significant costs on the operations of our customers and suppliers, which could have a material adverse impact on our results of operations, financial condition and cash flows.

Climate change regulation or some form of legislation aimed at reducing greenhouse gas (''GHG'') emissions is currently being considered in the United States as well as elsewhere globally. As a metals and plastics distributor, our operations do not emit significant amounts of GHG. However, the manufacturing processes of many of our suppliers and customers are energy intensive and generate carbon dioxide and other GHG emissions. Any adopted future climate change and GHG regulations may impose significant costs on the operations of our customers and suppliers and indirectly impact our operations.

The Tube Supply acquisition significantly ~~extends~~extended our exposure in the oil and gas sector to customers who utilize non-traditional drilling techniques, including hydraulic fracturing. Hydraulic fracturing is an important and commonly used process for the completion of natural gas, and to a lesser extent, oil wells in shale formations. Certain environmental and other groups have asserted that chemicals used in the fracturing process could adversely affect drinking water supplies. The U.S. Congress and various state and local governments are considering increased regulatory oversight

of the hydraulic fracturing process, including through additional permit requirements, operational restrictions, reporting obligations and temporary or permanent bans on hydraulic fracturing in certain environmentally sensitive areas such as watersheds. We cannot predict whether such laws or regulations will be enacted and, if so, what actions any such laws or regulations would require or prohibit. Additional levels of regulatory oversight on, or otherwise limiting, the hydraulic fracturing process could subject the business and operations of our oil and gas customers to delays, increased operating costs and process prohibitions, and indirectly impact our oil and gas business through reduced demand for our products.

Until the timing, scope and extent of any future regulation becomes known, we cannot predict the effect on our results of operations, financial condition and cash flows.

We have various mechanisms in place that may prevent a change in control that stockholders may otherwise consider favorable.

In August ~~2013,~~2012, our Board of Directors ~~extended~~implemented a shareholder rights plan pursuant to which one purchase right was distributed as a dividend on each share of our common stock held of record as of the close of business on September 11, 2012. Upon becoming exercisable, each right ~~will entitle~~would have entitled its holder to purchase from the Company one one-hundredth of a share of our Series B Junior Preferred Stock for the purchase price of $54.00. Generally, the rights ~~will~~would have become exercisable ten days after the date on which any person or group ~~becomes~~became the beneficial owner of 10% or more of our common stock or ~~has~~ commenced a tender or exchange offer which, if consummated, would ~~result~~have resulted in any person or group becoming the beneficial owner of 10% or more of our common stock, subject to the terms and conditions set forth in the shareholder rights plan. The rights ~~are~~were attached to the certificates representing outstanding shares of common stock until the rights ~~become~~became exercisable, at which point separate certificates ~~will be~~would have been distributed to the record holders of our common stock. If a person or group ~~becomes~~had become the beneficial owner of 10% or more of our common stock, which ~~we refer~~was referred to as an “acquiring person,” each right ~~will entitle~~would have entitled its holder, other than the acquiring person, to receive upon exercise a number of shares of our common stock having a market value of two times the purchase price of the right.

In August 2013, our Board of Directors extended the shareholder rights plan to August 2014, at which time it was not extended further and expired by its own terms. However, a similar or different shareholder rights plan could be implemented by the Board of Directors at any time, if the Board deemed such a plan in the best interest of the shareholders of Company. The shareholder rights plan isand any new plan that may be implemented are designed to deter coercive takeover tactics and to prevent an acquirer from gaining control of the Company without offering a fair price to all of our stockholders. The existence of ~~the~~a shareholder rights plan, however, could have the effect of making it more difficult for a third party to acquire a majority of our outstanding common stock, and thereby adversely affect the market price of our common stock.

In August 2013, the Company elected by resolution of the Board of Directors to become subject to Section 3-803 of the Maryland General Corporation Law, or the MGCL. As a result of this election, the Board of Directors was classified into three separate classes of directors, with each class generally serving three-year terms. Only one class of directors will be elected at each annual meeting of our stockholders, with the other classes continuing for the remainder of their respective three-year terms. The provision for a classified board could prevent a party who acquires control of a majority of our outstanding voting stock from obtaining control of our Board of Directors until the second annual stockholders meeting following the date the acquiring party obtains the controlling interest. The classified board provision could discourage a potential acquirer from making a tender offer or otherwise attempting to obtain control of us and could increase the likelihood that incumbent directors will retain their positions.

In addition, our charter and by-laws and the MGCL include provisions that may be deemed to have anti-takeover effects and may delay, defer or prevent a takeover attempt that stockholders might consider to be in their best interests. For example, the MGCL, our charter and bylaws require the approval of the holders of two-thirds of the votes entitled to be cast on the matter to amend our charter (unless our Board of Directors has unanimously approved the amendment, in which case the approval of the holders of a majority of such votes is required), contain certain advance notice procedures for nominating candidates for election to our Board of Directors, and permit our Board of Directors to issue up to 9.988 million shares of preferred stock.

Furthermore, we are subject to the anti-takeover provisions of the MGCL that prohibit us from engaging in a “business combination” with an “interested stockholder” for a period of five years after the date of the transaction in which the person first becomes an “interested stockholder,” unless the business combination or stockholder interest is approved in a prescribed manner. The application of these and certain other provisions of our charter or the MGCL could have the effect of delaying or preventing a change of control, which could adversely affect the market price of our common stock.

The provisions of our debt instruments also contain limitations on our ability to enter into change of control transactions. In addition, the repurchase rights in our 7.0% convertible senior notes due 2017 (“Convertible Notes”) triggered by the occurrence of a “fundamental change” (as defined in the indenture for the Convertible Notes), and the additional shares of our common stock by which the conversion rate is increased in connection with certain fundamental change transactions, as described in the indenture for the Convertible Notes, could discourage a potential acquirer.

~~Ownership~~We may not be able to realize the benefits we anticipate from our acquisitions.

We have acquired businesses and intend to continue to seek attractive opportunities to acquire other businesses in the future. Achieving the benefits of these acquisitions depends on the timely, efficient and successful execution of a number of post-acquisition events, including our ~~stock is concentrated, which may limit stockholders’~~integration of the acquired businesses. Factors that could affect our ability to ~~influence corporate matters.~~achieve the benefits we anticipate from our acquisitions include:

~~As of December 31, 2013, based on filings made with the SEC~~difficulties in integrating and managing personnel, financial reporting and other ~~information made available~~systems used by the acquired businesses;

the failure of the acquired businesses to ~~us as of that date, we believe two of~~perform in accordance with our ~~directors, Patrick J. Herbert, III and Reuben S. Donnelley, as general partners of W. B. & Co., may be deemed~~expectations;

failure to ~~beneficially own approximately 18% of~~achieve anticipated synergies between our common stock. Accordingly, Mr. Herbert and Mr. Donnelley and their affiliates may have the voting power to substantially control the outcome of matters requiring a stockholder vote including the election of directorsbusiness units and the ~~approval~~acquired businesses;

the loss of ~~significant corporate matters. Such a concentration~~the acquired businesses' customers; and

cyclicality or downturn of ~~control~~the acquired businesses’ customers’ industries.

The presence of any of the above factors individually or in combination could result in future impairment charges against the assets of the acquired businesses. If the acquired businesses do not operate as we anticipate, it could adversely affect our operating results and financial condition. As a result, there can be no assurance that the ~~market price of~~acquisitions will be successful or will not, in fact, adversely affect our ~~common stock or prevent a change in control or other business combinations that might be beneficial to us.~~business.

ITEM 1B — Unresolved Staff Comments

None.

ITEM 2 — Properties

The Company’s corporate headquarters are located in Oak Brook, Illinois. All properties and equipment are sufficient for the Company’s current level of activities. Distribution centers and sales offices are maintained at each of the following locations, most of which are leased, except as indicated:

Locations
Approximate
Floor Area in
Square Feet

Metals Segment
North America
Bedford Heights, Ohio 374,400
(1)
Birmingham, Alabama 76,000
(1)
Blaine, Minnesota 65,200
(1)
Charlotte, North Carolina 116,500
(1)
Edmonton, Alberta 87,100
(4)

Locations
Approximate
Floor Area in
Square Feet

Fairless Hills, Pennsylvania 71,600
(1)
Franklin Park, Illinois 522,600
(1)
Grand Prairie, Texas 78,000
(1)
Hammond, Indiana (H-A Industries) 243,000

Houston, Texas 383,100
(3)
Kennesaw, Georgia 87,500

Lafayette, Louisiana 5,000

Mississauga, Ontario 57,000

Paramount, California 155,500

Point Claire, Quebec 38,760

Santa Cantarina, Nuevo Leon, Mexico 112,000

Saskatoon, Saskatchewan 15,000

Selkirk, Manitoba 50,000
(1)
Stockton, California 60,000

Wichita, Kansas 95,000

Worcester, Massachusetts 53,500
(1)
Europe
Blackburn, England 62,140

Trafford Park, England 30,000

Montoir de Bretagne, France 38,940

Asia
Shanghai, China 45,700

Sales Offices
Bilbao, Spain (Intentionally left blank)

Fairfield, Ohio (Intentionally left blank)

Kansas City, Missouri (Intentionally left blank)

Kent, Washington (Intentionally left blank)

Longmeadow, Massachusetts (Intentionally left blank)

Milwaukee, Wisconsin (Intentionally left blank)

Phoenix, Arizona (Intentionally left blank)

Singapore (Intentionally left blank)

Tadlow,England (Intentionally left blank)

Tulsa, Oklahoma (Intentionally left blank)

Williamsville, New York (Intentionally left blank)

Total Metals Segment 2,923,540



Locations	Approximate Floor Area in Square Feet
Metals Segment
North America
Bedford Heights, Ohio	374,400	(1)
Birmingham, Alabama	76,000	(1)
Blaine, Minnesota	65,200	(1)
Charlotte, North Carolina	116,500	(1)
Edmonton, Alberta	87,100	(3)
Fairless Hills, Pennsylvania	71,600	(1)
Franklin Park, Illinois	522,600	(1)
Grand Prairie, Texas	78,000	(1)
Hammond, Indiana (H-A Industries)	243,000
Houston, Texas	274,000	(3)
Kennesaw, Georgia	87,500
Lafayette, Louisiana	5,000
Mexicali, Mexico	21,200
Mississauga, Ontario	57,000
Paramount, California	155,500
Point Claire, Quebec	38,760
Santa Cantarina, Nuevo Leon, Mexico	112,000


Locations	Approximate Floor Area in Square Feet		Approximate Floor Area in Square Feet
Saskatoon, Saskatchewan			15,000
Selkirk, Manitoba			50,000	(1)
Stockton, California			60,000
Wichita, Kansas			102,000
Worcester, Massachusetts			53,500	(1)
Europe
Blackburn, England			62,140
Trafford Park, England			30,000
Montoir de Bretagne, France			38,940
Asia
Shanghai, China			45,700
Singapore			76,000
Sales Offices
Bilbao, Spain			(Intentionally left blank)
Fairfield, Ohio			(Intentionally left blank)
Kansas City, Missouri			(Intentionally left blank)
Tadlow, England			(Intentionally left blank)
Total Metals Segment			2,918,640

Plastics Segment
Baltimore, Maryland	24,000		24,000
Bronx, New York	18,500		18,500
Cleveland, Ohio	8,580		8,580
Cranston, Rhode Island	14,900		14,900
Detroit, Michigan	22,000		22,000
Elk Grove Village, Illinois	22,500		22,500
Fairless Hills, Pennsylvania	12,480	(1)	10,000	(1)
Fort Wayne, Indiana	17,600		17,600
Grand Rapids, Michigan	42,500	(1)	42,500	(1)
Harrisburg, Pennsylvania	13,880		13,880
Indianapolis, Indiana	13,500		13,500
Kalamazoo, Michigan	88,000		88,000
Knoxville, Tennessee	16,530		16,530
New Philadelphia, Ohio	15,700		15,700
Pittsburgh, Pennsylvania	12,800		12,800
Rockford, Michigan	53,650		53,650
Tampa, Florida	17,700		17,700
Walker, Michigan	59,630		59,630
Total Plastics Segment	474,450		471,970
Headquarters
Oak Brook, Illinois	39,360	(2)	39,360	(2)
GRAND TOTAL	3,437,350		3,429,970


(1)	Represents owned facility.


(2)	The Company’s principal executive offices do not include a distribution ~~or sales office.~~center.


(3)	Represents two leased ~~facilities (274,000 square feet) and one owned facility (109,100 square feet).~~facilities.


~~(4)~~	~~Represents two leased facilities of approximately 43,500 square feet each.~~

ITEM 3 — Legal Proceedings

(~~Amounts~~Dollar amounts in millions)

The Company is party to a variety of legal proceedings and other claims, including proceedings by government authorities, which arise from the operation of its business. These proceedings are incidental and occur in the normal course of the Company's business affairs. The majority of these claims and proceedings relate to commercial disputes with customers, suppliers, and others; employment, including benefit matters; product quality; and environmental, health and safety claims. It is the opinion of management that the currently expected outcome of these proceedings and claims, after taking into account recorded accruals and the availability and limits of our insurance coverage, will not have a material adverse effect on the consolidated results of operations, financial condition or cash flows of the Company.

During the quarter ended March 31, 2013, the Company received warranty and other claims from certain customers regarding alleged quality defects with certain alloy round bar products sold by the Company in 2012 and 2013. The Company evaluated the information provided by the customers and issued a notice of potential defect to other affected customers. The Company ~~estimates that it may incur~~has incurred costs for warranty and other customer claims associated with ~~the~~these alleged quality defects ~~from $0.3~~of $1.2 million to ~~$1.3 million. Based on the information available as of December 31, 2013, the Company's best estimate of the probable loss resulting from these claims is $1.2 million~~date, of which ~~approximately~~$0.1 million and $1.1 million iswere included as ~~a reduction~~reductions of net sales for the ~~year~~years ended December 31, ~~2013. Through~~2014 and December 31, 2013, ~~approximately $0.8 million was paid or credited to customer accounts and $0.3 million was accrued in current liabilities~~respectively. As of December 31, 2014, the Company is not aware of any remaining active claims for ~~future payments and credits.~~compensation as a result of the alleged quality defects. The Company is pursuing claims against the original supplier of the products. ~~There~~While the Company does not currently expect further claims related to the alleged quality defects, there can be no assurance that additional claims will not arise or that the ~~Company's~~Company will not incur further losses related to ~~these~~such claims ~~will not exceed~~in the ~~Company's estimated range.~~future.

ITEM 4 — Mine Safety Disclosures

Not applicable.

Executive Officers of ~~The~~the Registrant

The following selected information for each of our current executive officers (as defined by regulations of the SEC) was prepared as of February ~~28, 2014~~.27, 2015.



Name and Title	Age	Business Experience
Patrick R. Anderson Interim Vice President, Chief Financial Officer and Treasurer and Vice President, Corporate Controller and Chief Accounting Officer	4243	Mr. Anderson began his employment with the registrant in 2007 ~~and was elected to the position of~~as Vice President, Corporate Controller and Chief Accounting Officer. In September 2014, he was appointed to the position of Interim Vice President, Chief Financial Officer and Treasurer. Prior to joining the registrant, he was employed ~~as a Senior Manager~~ with Deloitte & Touche LLP (a global accounting firm) ~~where he was employed~~ from 1994 to 2007.
~~Jose-Luis Bretones-Lopez~~ ~~Vice President, Strategic Sourcing and~~ ~~Supply Chain~~	45	Mr. Bretones-Lopez began his employment with the registrant in March 2013. Prior to joining the registrant, he served as Director Worldwide Supply Chain for McDonald’s Corporation (a leading global foodservice retailer) from 2008 to 2013. From 2004 to 2008 Mr. Bretones-Lopez served as the Director for Business Strategy, Planning and Execution at McDonald’s Corporation and from 2002 to 2004 he served as McDonald’s Corporation Director of Program and Project Management for the Asia Pacific Middle East and Africa region.
Scott J. Dolan President and Chief Executive Officer	4344	Mr. Dolan began his employment with the registrant in 2012 as President and Chief Executive Officer. Prior to joining the registrant, he served as Senior Vice President, Airport Operations and Cargo, of United Continental Holdings, Inc. (a $37 billion publicly traded provider of passenger and cargo air transportation services), and its principal wholly-owned subsidiaries, United Airlines and Continental Airlines, from 2010 to 2011. From 2004 until 2010, Mr. Dolan served as Senior Vice President, Airport Operations and President, United Cargo (2006-2010) and as Senior Vice President and President, United Cargo (2004-2006) for UAL Corporation and its principal subsidiary, United Airlines. Mr. Dolan worked at Atlas Air Worldwide Holdings, Inc. (a global airfreight company) from 2002 to 2004, where he served as Senior Vice President and Chief Operating Officer from ~~2003-2004~~2003 to 2004 and as Vice President, Business Integration from 2002 to 2003. Prior to joining Atlas Air, Mr. Dolan spent five years at General Electric Company, where he served in a variety of positions including Vice President, Operational Performance, Polar Air Cargo, a subsidiary of GE Capital Aviation Services.



Name and Title	Age	Business Experience
Marec E. Edgar Vice President, General Counsel and Secretary	39	Mr. Edgar began his employment with the registrant in April 2014, as Vice President, General Counsel and Secretary. Prior to joining the registrant, he held positions of increasing responsibility with Gardner Denver, Inc., a $2 billion global manufacturer of industrial compressors, blowers, pumps, loading arms and fuel systems, from 2004 to March 2014. Most recently, he served as Assistant General Counsel and Risk Manager and Chief Compliance Officer of Gardner Denver.
Thomas L. Garrett Vice President and President, Total Plastics, Inc.	5152	Mr. Garrett began his employment with Total Plastics, Inc., a wholly owned subsidiary of the registrant, in 1988 and was appointed to the position of Controller. In 1996, he was elected to the position of Vice President and in 2001 was appointed to the position of Vice President of the registrant and President of Total Plastics, Inc.



~~Name and Title~~	~~Age~~	~~Business Experience~~
~~Kevin H. Glynn~~ ~~Vice President~~ ~~and Chief Information Officer~~	50	Mr. Glynn began his employment with the registrant in October 2010 as the Interim Chief Information Officer. In January 2011, he was appointed Vice President and Chief Information Officer. Prior to joining the registrant, he was employed as a Managing Principal at Laminar Group LLC (a management consulting company) from 2009 to 2010, Chief Operating Officer at IRON Solutions, Inc. (an information technology company specializing in data, software and media services for the agriculture equipment market) from 2008 to 2009 and as Senior Vice President and Chief Information Officer at CNH America, LLC (a manufacturer of agricultural and construction equipment) from 2006 to 2007.
Ronald E. Knopp Vice President, Operations	4344	Mr. Knopp began his employment with the registrant in 2007 and was appointed to the position of Operations Manager of the Bedford Heights facility. In 2009, he was appointed Director of Operations for the Western Region and in 2010 served as Director of Operations for the Metals and Plate Commercial Units. In July 2013, Mr. Knopp was appointed to the position of Vice President, Operations. Prior to joining the registrant, Mr. Knopp served as Plant Manager for Alcoa, Inc., Aerospace Division (global producer of aluminum) from 2003 to 2007.
Stephen J. Letnich Chief Commercial Officer	4647	Mr. Letnich began his employment with the registrant in July 2013 as Chief Commercial Officer. Prior to joining the registrant, he was employed as Vice President of Sales & Chief Marketing Officer at Central Steel and Wire Company (a metals service center) from 2011 to 2013, Vice President of Sales & Marketing at Metal Sales Manufacturing Corporation (a metal roofing and wall system manufacturer) from 2009 to 2011 and from 1994 to 2009 Mr. Letnich held various positions of increasing responsibility at Worthington Industries (a global metals company), including most recently as Vice President of Sales and Marketing from 2007 to 2009.
~~Anne D. Scharm~~A. Jeffrey Zappone ~~Vice President, Human Resources~~ Interim Chief Operating Officer	37	Ms. Scharm began her employment with the registrant in 2011 as the Director of Organizational Development. In December 2011, she was appointed as the Interim Vice President, Human Resources. In March 2012, she was appointed Vice President, Human Resources. Prior to joining the registrant, she was employed as Director of Human Resources and Organizational Development with Delnor Health System, (now known as Cadence Health - a healthcare organization) from 2006 to 2011.
~~Scott F. Stephens~~ ~~Vice President,~~ ~~Chief Financial Officer and Treasurer~~	4448	Mr. ~~Stephens~~Zappone began his ~~employment~~consulting engagement with the registrant in ~~2008~~February 2015, as Interim Chief Operating Officer. Mr. Zappone has over twenty years of experience in restructuring, reorganization and ~~was elected to the position~~turnaround management. He has served as a Senior Managing Director of ~~Vice President, Chief Financial Officer~~Conway MacKenzie, a financial and ~~Treasurer. From February 2010 to December 2010, he was also appointed to the position of Interim President, Castle Metals Oil & Gas. In May 2012,~~management consulting firm, since 2002. Mr. ~~Stephens was elected to serve~~Zappone has served as a financial advisor as well as Interim Chief Executive Officer, ~~until October 2012. Formerly, he served as the CFO~~Chief Restructuring Officer and Interim Chief Financial Officer to companies in manufacturing, distribution and service industries. His experience spans a wide range of ~~Lawson Products, Inc. (a distributor of~~industries including manufacturing, machining, fabrication, processing and forging metals, automotive, warehousing and distribution, transportation, aerospace, commercial finance and leasing, retail, services, ~~systems~~consumer products, food and beverage, paper products ~~to the MRO~~ and ~~OEM marketplace) since 2004, and CFO of The Wormser Company from 2001 to 2004.~~solar energy.

PART II

ITEM 5 — Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

The Company’s common stock trades on the New York Stock Exchange under the ticker symbol “CAS”. As of February ~~28, 2014~~25, 2015 there were approximately ~~813~~761 shareholders of record. Payment of cash dividends and repurchase of common stock are currently limited due to restrictions contained in the Company’s debt agreements. No cash dividends were paid on the Company’s common stock in ~~2013 and 2012.~~2014 or 2013. We may consider paying cash dividends on the Company common stock at some point in the future, subject to the limitations described above. Any future payment of cash dividends, if any, is at the discretion of the Board of Directors and will depend on the Company’s earnings, capital requirements and financial condition, restrictions under the Company’s debt instruments, and such other factors as the Board of Directors may consider.

See Part III, Item 12, “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters”, for information regarding common stock authorized for issuance under equity compensation plans.

The table below presents shares of the Company’s common stock which were acquired by the Company during the three months ended December 31, ~~2013:~~2014:


Period	Total Number of Shares Purchased (1)	Average Price Paid per Share		Total number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased under the Plans or Programs	Total Number of Shares Purchased (1)	Average Price Paid per Share		Total number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased under the Plans or Programs
October 1 through October 31	—	—		—	—	—	—		—	—
November 1 through November 30	—	—		—	—	—	—		—	—
December 1 through December 31	13,321	$	14.77	—	—	12,783	$	7.98	—	—
Total	13,321	$	14.77	—	—	12,783	$	7.98	—	—


(1)	The total number of shares purchased represents shares surrendered to the Company by employees to satisfy tax withholding obligations upon vesting of restricted stock units awarded pursuant to the Company’s ~~2011 - 2013 Long-Term Compensation Plan.~~2008 Omnibus Incentive Plan (as amended and restated as of April 25, 2013).

Directors of the Company who are not employees may elect to defer receipt of up to 100% of their cash retainer. A director who defers board compensation may select either an interest or a stock equivalent investment option for amounts in the director's deferred compensation account. Disbursement of the stock equivalent unit account may be in shares of Company common stock or in cash as designated by the director upon the director's departure from the board or otherwise in accordance with the director's election that was made at the time of the election to defer compensation. If payment from the stock equivalent unit account is made in shares of the Company's common stock, the number of shares to be distributed will equal the number of full stock equivalent units held in the director's account. On October 1, ~~2013, one of the Company's directors~~2014, approximately 1,812 shares were deferred ~~receipt of his~~as payment for board ~~fees into a stock equivalent unit account representing 458 share equivalent units~~compensation. The shares were acquired at a price of ~~$16.36~~$8.28 per share, which ~~represented~~represents the closing price of the Company's common stock on the day as of which such fees would otherwise have been paid to the ~~director.~~directors. The issuance of these shares of restricted stock units was made in reliance upon the exemptions from registration provided by Section 4(a)(2) under the Securities Act of 1933, as amended.

The following table sets forth the range of the high and low sales prices of shares of the Company’s common stock for the periods indicated:


	2013				2012				2014				2013
	Low		High		Low		High		Low		High		Low		High
First Quarter	$	13.25	$	18.74	$	9.59	$	12.90	$	13.42	$	15.64	$	13.25	$	18.74
Second Quarter	$	15.65	$	18.64	$	9.65	$	14.20	$	10.87	$	14.99	$	15.65	$	18.64
Third Quarter	$	14.59	$	17.54	$	6.99	$	13.54	$	8.15	$	11.87	$	14.59	$	17.54
Fourth Quarter	$	13.20	$	16.64	$	10.83	$	14.97	$	6.16	$	8.57	$	13.20	$	16.64

The following graph compares the cumulative total stockholder return on our common stock for the five-year period ended December 31, ~~2013,~~2014, with the cumulative total return of the Standard and Poor’s 500 Index and to a peer group index. The comparison in the graph assumes the investment of $100 on December 31, ~~2008.~~2009. Cumulative total stockholder return means share price increases or decreases plus dividends paid, with the dividends reinvested, and reflect market capitalization weighting. The graph does not forecast future performance of our common stock. The Company has utilized the current peer group index since 2010. The Company believes this peer group provides a meaningful comparison of our stock performance, and it is consistent with the peer group used for the relative total shareholder return performance measure under the Company’s long term compensation plans. The peer group index is made up of companies in the metals industry or in the industrial products distribution business, although not all of the companies included in the peer group index participate in all of the lines of business in which the Company is engaged and some of the companies included in the peer group index also engage in lines of business in which the Company does not participate. Additionally, the market capitalizations of many of the companies in the peer group are quite different from that of the Company.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*

Among A.M. Castle & Co., the S&P 500 Index, and a Peer Group

*$100 invested on 12/31/0809 in stock or index, including reinvestment of dividends.

Fiscal year ending December 31.


	12/08		12/09		12/10		12/11		12/12		12/13		12/09		12/10		12/11		12/12		12/13		12/14
A. M. Castle & Co.	$	100.00	$	127.23	$	171.10	$	87.92	$	137.27	$	137.27	$	100.00	$	134.48	$	69.10	$	107.89	$	107.89	$	58.29
S&P 500	100.00		126.46		145.51		148.59		172.37		228.19		100.00		115.06		117.49		136.30		180.44		205.14
Peer Group (a)	100.00		135.64		164.96		148.59		152.39		178.44		100.00		121.60		110.02		111.75		130.51		117.91

(a)

The Peer Group Index consists of the following companies: AEP Industries Inc.; AK Steel Holding Corp.; Allegheny Technologies Inc.~~; Amcol International Corp.~~; Applied Industrial Technologies Inc.; Carpenter Technology Corp.; Cliffs Natural Resources Inc.; Commercial Metals Company; Fastenal Company; Gibraltar Industries Inc.; Haynes International Inc.; Kaman Corp.; Lawson Products Inc.; MSC Industrial Direct Company Inc.; Nucor Corp.; Olin Corp.; Olympic Steel, Inc.; Quanex Building Products Corp.; Reliance Steel & Aluminum Co.; RTI International Metals Inc.; Schnitzer Steel Industries Inc.; Steel Dynamics Inc.; Stillwater Mining Company; ~~Texas Industries Inc.;~~ United States Steel Corp.; and Worthington Industries Inc.

ITEM 6 — Selected Financial Data

(~~Amounts~~Dollar amounts in millions, except per share data)

The Selected Financial Data in the table below includes the results of the December 2011 acquisition of Tube Supply from the date of acquisition.


	2013			2012			2011			2010			2009			2014			2013			2012			2011			2010
For the year ended December 31:
Net sales	$	1,053.1		$	1,270.4		$	1,132.4		$	943.7		$	812.6		$	979.8		$	1,053.1		$	1,270.4		$	1,132.4		$	943.7
Equity in earnings of joint venture	7.0			7.2			11.7			5.6			0.4			7.7			7.0			7.2			11.7			5.6
Net loss from continuing operations	(34.0		)	(9.7		)	(1.8		)	(5.6		)	(26.9		)	(134.7		)	(34.0		)	(9.7		)	(1.8		)	(5.6		)
Basic (loss) earnings per common share from continuing operations	(1.46		)	(0.42		)	(0.08		)	(0.25		)	(1.18		)	(5.77		)	(1.46		)	(0.42		)	(0.08		)	(0.25		)
Diluted (loss) earnings per common share from continuing operations	(1.46		)	(0.42		)	(0.08		)	(0.25		)	(1.18		)	(5.77		)	(1.46		)	(0.42		)	(0.08		)	(0.25		)
Cash dividends declared per common share	—			—			—			—			0.06			—			—			—			—			—
As of December 31:
Total assets	679.8			788.8			822.3			529.4			558.0			588.0			679.8			788.8			822.3			529.4
Long-term debt, less current portion	245.6			296.2			314.2			61.1			67.7			309.4			245.6			296.2			314.2			61.1
Total debt	246.0			297.1			314.9			69.1			89.2			310.1			246.0			297.1			314.9			69.1
Total stockholders’ equity	309.9			337.3			312.3			313.5			318.2			150.3			309.9			337.3			312.3			313.5

ITEM 7 — Management’s Discussion and Analysis of Financial Condition and Results of Operations

(Dollar amounts in millions, except per share data)

Information regarding the business and markets of A.M. Castle & Co. and its subsidiaries (the “Company”), including its reportable segments, is included in Item 1 “Business” of this annual report on Form 10-K.

The following discussion should be read in conjunction with Item 6 “Selected Financial Data” and the Company’s consolidated financial statements and related notes thereto in Item 8 “Financial Statements and Supplementary Data”. The following discussion and analysis of our financial condition and results of operations contain forward-looking statements and includes numerous risks and uncertainties, including those described under Item 1A "Risk Factors" and "Disclosure Regarding Forward-Looking Statements" of this annual report on Form 10-K. Actual results may differ materially from those contained in any forward-looking statements.

EXECUTIVE OVERVIEW

The Company’s strategy is to become the foremost global provider of metals products and services and specialized supply chain solutions to targeted global industries.

During ~~2013,~~2014, the following significant events occurred which impacted the Company’s operations and/or financial results:

Net sales declined by ~~17.1%~~7.0% compared to ~~2012~~2013 due to decreased Metals segment sales volumes and pricing;

~~Inventory reductions and softer material pricing in 2013 resulted in LIFO credits of $8.6 million compared to LIFO charges of $1.1 million in 2012;~~

~~Incurred~~Recorded a $~~10.2~~56.2 million non-cash goodwill impairment charge in the second quarter of ~~charges~~2014 related to ~~restructuring activities announced in January and October 2013;~~the Metals segment goodwill; and

~~Operating expenses, which included $9.0~~Recognized a $5.5 million gain on of ~~restructuring charges~~the sale of fixed assets in ~~2013, were 4.5% lower than 2012 due to cost savings resulting from restructuring activities and lower net sales.~~Houston in the third quarter of 2014.

Recent Market and Pricing Trends

The Company experienced lower ~~demand from~~net sales of its ~~customer base~~Metals segment products during 2014 compared to 2013 due to lower demand in the ~~Metals segment during 2013 compared to 2012 as key end markets were weaker than in 2012.~~Oil and Gas and Industrial sectors. Industry data provided by the Metals Service Center Institute ("MSCI") indicates that overall ~~2013~~2014 U.S. steel service center shipment volumes ~~were approximately equal~~increased 5% compared to ~~2012~~2013 levels. ~~However, 2013~~According to MSCI data, industry sales volumes of products consistent with the Company's product mix were ~~7% lower~~

~~than 2012 according~~up 6% in 2014 compared to ~~MSCI data,~~2013, while the Company experienced ~~an 18%~~a 1.7% decline in sales volumes of their metal products in ~~2013~~2014 when compared to ~~2012. Pricing across the majority of the Company’s metal markets softened during~~ 2013. The combination of lower demand and pricing for the Company's metals products negatively impacted the Company’s Metals segment operating results during ~~2013.~~2014.

Changes in pricing can have a more direct impact on the Company’s operating results than changes in volume due to certain factors including but not limited to:

Changes in volume typically result in corresponding changes to the Company’s variable costs. However, as pricing changes occur, variable expenses are not directly impacted.

If surcharges are not passed through to the customer or are passed through without a mark-up, the Company’s profitability will be adversely impacted.

The Plastics segment experienced an increase in demand for its products in ~~2013~~2014 compared to ~~2012,~~2013, reflecting strength in the automotive, marine and life science sectors. Due to the late-cycle nature of the Company’s targeted customers, results typically lag the general economic cycle by a range of six to twelve months.

Current Business Outlook

Management uses the Purchasing Managers Index (‘PMI’) provided by the Institute for Supply Management (website is www.ism.ws) as an external indicator for tracking the demand outlook and possible trends in its general manufacturing markets. The table below shows PMI trends from the first quarter of ~~2011~~2012 through the fourth quarter of ~~2013~~2014. Generally speaking, according to the ISM, an index above 50.0 indicates growth in the manufacturing sector of the U.S. economy, while readings under 50.0 indicate contraction.


YEAR	Qtr 1	Qtr 2	Qtr 3	Qtr 4	Qtr 1	Qtr 2	Qtr 3	Qtr 4
2011	61.1	56.4	51.0	52.4
2012	53.3	52.7	50.3	50.6	53.3	52.7	50.3	50.6
2013	52.9	50.2	55.8	56.9	52.9	50.2	55.8	56.9
2014					52.7	55.2	57.6	57.7

Material pricing and demand in both the Metals and Plastics segments of the Company’s business have historically proven to be difficult to predict with any degree of accuracy. A favorable PMI trend suggests that demand for some of the Company’s products and services, in particular those that are sold to the general manufacturing customer base in the U.S., could potentially be at a higher level in the near-term. The ~~PMI trended upward in the second half of~~ ~~2013~~ ~~with third quarter and fourth quarter average PMI indexes that were the highest since the second quarter of~~ ~~2011. The~~ Company believes that its revenue trends typically correlate to the changes in PMI on a six to twelve month lag basis. In 2014, the Company experienced branch consolidation execution issues at certain of its plate and oil and gas facilities. As a result of these issues, revenue trends have not improved in correlation to the change in PMI on the expected six to twelve month lag basis. The Company continues to evaluate the correlation and lag of its revenue trends to PMI to determine if this is specific to the internal execution issues or a permanent change in the correlation of the two variables. The Company is cautious about its performance in the oil and gas market in 2015 due to oil price declines that have led to reduced demand and pricing in this market.

RESULTS OF OPERATIONS: YEAR-TO-YEAR COMPARISONS AND COMMENTARY

Our discussion of comparative period results is based upon the following components of the Company’s consolidated statements of operations.

Net Sales —The Company derives its sales from the processing and delivery of metals and plastics. Pricing is established with each customer order and includes charges for the material, processing activities and delivery. The pricing varies by product line and type of processing. From time to time, the Company may enter into fixed price arrangements with customers while simultaneously obtaining similar agreements with its suppliers.

Cost of Materials — Cost of materials consists of the costs that the Company pays suppliers for metals, plastics and related inbound freight charges, excluding depreciation and amortization which are included in operating costs and expenses discussed below. The Company accounts for inventory primarily on a last-in-first-out (“LIFO”) basis. LIFO adjustments are calculated as of December 31 of each year. LIFO adjustments are recognized during the fiscal year based on the projected year end adjustment calculation. The Company may enter into hedges to mitigate the risk associated with commodity price fluctuations. Gains and losses which result from marking the hedge contracts to market are recorded in cost of materials.

Operating Costs and Expenses — Operating costs and expenses primarily consist of:

Warehouse, processing and delivery expenses, including occupancy costs, compensation and employee benefits for warehouse personnel, processing, shipping and handling costs;

Sales expenses, including compensation and employee benefits for sales personnel;

General and administrative expenses, including compensation for executive officers and general management, expenses for professional services primarily related to accounting and legal advisory services, bad debt expense, data communication and computer hardware and maintenance;

Restructuring ~~charges,~~activity, including moving costs and gain on the sale of fixed assets associated with plant consolidations, employee termination and related benefits costs associated with ~~salaried and hourly~~ workforce reductions, lease termination costs ~~moving costs~~ and other exit ~~costs associated with plant consolidations; and~~costs;

Depreciation and amortization expenses, including depreciation for all owned property and equipment, and amortization of various intangible ~~assets.~~assets; and

Impairment of goodwill.

2014 Results Compared to 2013

Consolidated results by business segment are summarized in the following table for years 2014 and 2013.

Operating Results by Segment



	Year Ended December 31,						Favorable / (Unfavorable)
	2014			2013			$ Change			% Change
Net Sales
Metals	$	841.7		$	918.3		$	(76.6	)	(8.3	)%
Plastics	138.1			134.8			3.3			2.4	%
Total Net Sales	$	979.8		$	1,053.1		$	(73.3	)	(7.0	)%
Cost of Materials
Metals	$	648.5		$	683.3		$	34.8		5.1	%
% of Metals Sales	77.0		%	74.4		%
Plastics	97.9			95.9			(2.0		)	(2.1	)%
% of Plastics Sales	70.9		%	71.1		%
Total Cost of Materials	$	746.4		$	779.2		$	32.8		4.2	%
% of Total Sales	76.2		%	74.0		%
Operating Costs and Expenses
Metals	$	287.9		$	246.6		$	(41.3	)	(16.7	)%
Plastics	33.9			34.6			0.7			2.0	%
Other	10.5			8.4			(2.1		)	(25.0	)%
Total Operating Costs and Expenses	$	332.3		$	289.6		$	(42.7	)	(14.7	)%
% of Total Sales	33.9		%	27.5		%
Operating (Loss) Income
Metals	$	(94.7	)	$	(11.6	)	$	(83.1	)	(716.4	)%
% of Metals Sales	(11.3		)%	(1.3		)%
Plastics	6.3			4.3			2.0			46.5	%
% of Plastics Sales	4.6		%	3.2		%
Other	(10.5		)	(8.4		)	(2.1		)	(25.0	)%
Total Operating Loss	$	(98.9	)	$	(15.7	)	$	(83.2	)	(529.9	)%
% of Total Sales	(10.1		)%	(1.5		)%

“Other” includes costs of executive, legal and elements of the finance department which are shared by both segments of the Company.

Net Sales:

Consolidated net sales were $979.8 million in 2014, a decrease of $73.3 million, or 7.0%, compared to 2013. Metals segment net sales during 2014 of $841.7 million were $76.6 million, or 8.3%, lower than 2013 reflecting lower average selling prices and demand compared to 2013. Plastics segment 2014 net sales of $138.1 million were $3.3 million, or 2.4%, higher than 2013.

Metals segment pricing declined by 5.9% compared to 2013. The pricing decline was primarily driven by average price decreases for aluminum, nickel and tubing products. Metals segment sales volumes declined by 1.7% compared to 2013. Carbon and alloy plate, tubing and aluminum products had the most significant decline in sales volumes compared to 2013. All of the Metals segment products had lower average selling prices when compared to 2013, with most average selling prices lower by 4% to 9%. The increase in Plastics segment net sales during 2014 was primarily due to strength in the automotive, marine, life science and home goods markets.

Cost of Materials:

Cost of materials (exclusive of depreciation and amortization) during 2014 were $746.4 million, a decrease of $32.8 million, or 4.2%, compared to 2013. Cost of materials included LIFO income of $1.1 million in 2014 and $8.6 million in 2013.

Cost of materials for the Metals segment were $648.5 million, or 77.0% as a percent of net sales, in 2014 compared to $683.3 million or 74.4% as a percent of net sales in 2013. Metals segment cost of materials included charges associated with net realized and unrealized losses for forward contracts related to the commodity hedging program of $0.3 million and $2.1 million for 2014 and 2013, respectively. Metals segment 2013 cost of materials included $1.2 million of charges related to the write off of inventory as part of the Company's restructuring activities that were announced in January 2013. Metals segment cost of materials as a percent of net sales were higher in 2014 than 2013 primarily due to increases in inventory reserves for excess and obsolete material. Cost of materials for the Plastics segment were $97.9 million, or 70.9% as a percent of net sales, in 2014 compared to $95.9 million, or 71.1% as a percent of net sales, for 2013. Plastics segment cost of materials as a percent of nets sales were lower in 2014 compared to 2013 due to supply chain and operations efficiency improvements implemented during 2014.

Operating Costs and Expenses and Operating (Loss) Income:

On a consolidated basis, operating costs and expenses increased $42.7 million, or 14.7%, from $289.6 million, or 27.5% as a percent of net sales in 2013 to $332.3 million, or 33.9% percent of net sales, during 2014.

The Company recorded a $56.2 million goodwill impairment charge during the second quarter of 2014 that is reflected in operating expenses for 2014. Management concluded during the second quarter of 2014 that an interim impairment test of its Metals segment goodwill was necessary. The results of the interim impairment analysis indicated that the Metals segment goodwill was impaired, and the Company recorded a $56.2 million non-cash impairment charge to eliminate the Metals segment goodwill. For additional detail, see Note 3 - Goodwill and Intangible Assets to the Consolidated Financial Statements.

A net gain of $3.0 million associated with the Company's restructuring activities was included in operating costs and expenses in 2014. Restructuring activities for 2014 consisted of a gain on the sale of fixed assets in Houston where the Company completed an October 2013 announced plant consolidation partially offset by: (i) employee termination and related benefits for the workforce reductions from the organizational changes announced in June 2014; (ii) moving costs associated with the plant consolidations announced in October 2013; and (iii) lease termination costs related to the restructuring activities announced in January 2013. The Company recorded restructuring charges of $9.0 million in operating costs during 2013 for the January and October 2013 announced restructuring activities related to moving costs associated with the plant consolidations, employee termination and related benefits, lease termination costs and other exit costs. For additional detail, see Note 10 - Restructuring Activity to the Consolidated Financial Statements.

In addition to the goodwill impairment and restructuring items, all other operating costs decreased by $1.5 million in 2014 compared to 2013 related to the following:

Warehouse, processing and delivery costs decreased by $0.4 million to $140.6 million, or 14.3% as a percent of net sales, primarily as a result of the decrease in sales activity in the Metals segment and cost decreases resulting from restructuring activities, which was partially offset by higher costs from branch consolidations in locations that serve plate and oil and gas end markets and the Company's strategic local inventory deployment initiative.

Sales, general and administrative costs decreased by $0.9 million to $112.5 million, or 11.5% as a percent of net sales, primarily due to lower payroll and benefits costs resulting from restructuring activity workforce reductions; and

Depreciation and amortization expense decreased by $0.2 million in 2014.

Consolidated operating loss for 2014, including goodwill impairment charges of $56.2 million and a net gain from restructuring activity of $3.0 million, was $98.9 million compared to an operating loss of $15.7 million, including $9.0 million of restructuring charges, in 2013.

Other Income and Expense, Income Taxes and Net Loss:

Interest expense was $40.5 million in 2014, a decrease of $2.6 million compared to 2013. The decrease in interest expense in 2014 was due to the retirement of $15.0 million of the Company's Senior Secured Notes in the fourth quarter of 2013 which resulted in a $2.6 million loss on extinguishment of debt recorded in 2013. There was no such loss on extinguishment of debt recognized in 2014.

Other expense related to foreign currency transaction losses was $4.3 million in 2014 compared to $1.9 million for 2013. The majority of these transaction losses related to unhedged intercompany financing arrangements between the United States and the United Kingdom and Canada.

The Company recorded an income tax benefit of $1.4 million in 2014 compared to a tax benefit of $19.8 million in 2013. The Company’s effective tax rate is expressed as 'Income taxes,' which includes tax expense on the Company’s share of joint venture earnings, as a percentage of 'Loss before income taxes and equity in earnings of joint venture.' This calculation includes taxes on the joint venture income but excludes joint venture income. The effective tax rate for 2014 and 2013 was 0.9% and 32.6%, respectively. The lower effective tax rate results from changes in the geographic mix and timing of income (losses), recording valuation allowances against certain deferred tax assets in the U.S. and at certain foreign subsidiaries and the impact of goodwill impairment and restructuring charges.

Equity in earnings of the Company’s joint venture was $7.7 million in 2014 compared to $7.0 million in 2013. Improved demand and pricing for Kreher's products were the primary factors contributing to the increase in equity in earnings of the Company's joint venture.

Consolidated net loss for 2014 was $134.7 million, or $5.77 per diluted share, compared to net loss of $34.0 million, or $1.46 per diluted share, for 2013.

2013 Results Compared to 2012

Consolidated results by business segment are summarized in the following table for years 2013 and 2012.

Operating Results by Segment



	Year Ended December 31,						Favorable / (Unfavorable)
	2013			2012			$ Change			% Change
Net Sales
Metals	$	918.3		$	1,143.9		$	(225.6	)	(19.7	)%
Plastics	134.8			126.5			8.3			6.6	%
Total Net Sales	$	1,053.1		$	1,270.4		$	(217.3	)	(17.1	)%
Cost of Materials
Metals	$	683.3		$	836.3		$	153.0		18.3	%
% of Metals Sales	74.4		%	73.1		%
Plastics	95.9			91.0			(4.9		)	(5.4	)%
% of Plastics Sales	71.1		%	71.9		%
Total Cost of Materials	$	779.2		$	927.3		$	148.1		16.0	%
% of Total Sales	74.0		%	73.0		%
Operating Costs and Expenses
Metals	$	246.6		$	259.1		$	12.5		4.8	%
Plastics	34.6			32.3			(2.3		)	(7.1	)%
Other	8.4			11.9			3.5			29.4	%
Total Operating Costs and Expenses	$	289.6		$	303.3		$	13.7		4.5	%
% of Total Sales	27.5		%	23.9		%
Operating (Loss) Income
Metals	$	(11.6	)	$	48.5		$	(60.1	)	(123.9	)%
% of Metals Sales	(1.3		)%	4.2		%
Plastics	4.3			3.2			1.1			34.4	%
% of Plastics Sales	3.2		%	2.5		%
Other	(8.4		)	(11.9		)	3.5			29.4	%
Total Operating (Loss) Income	$	(15.7	)	$	39.8		$	(55.5	)	(139.4	)%
% of Total Sales	(1.5		)%	3.1		%

“Other” includes costs of executive, legal and elements of the finance ~~departments~~department which are shared by both segments of the Company.

Net Sales:

Consolidated net sales were $1,053.1 million in 2013, a decrease of $217.3 million, or 17.1%, compared to 2012. Metals segment net sales during 2013 of $918.3 million were $225.6 million, or 19.7%, lower than 2012. Lower net sales were the result of a 17.9% decline in shipping volumes in 2013 compared to 2012 and pricing declines, to a lesser extent, due to market weakness. Alloy bar, tubing and carbon and alloy plate products experienced the most significant decrease in demand in 2013 compared to 2012. Overall average prices in 2013 were lower than 2012, with

carbon and alloy plate, tubing and alloy bar products experiencing the largest pricing declines of 4% to 11% from 2012 levels.

Plastics segment net sales during 2013 of $134.8 million were ~~$8.3~~$8.3 million,, or 6.6%, higher than 2012 primarily due to increased sales volume, reflecting strength in the automotive, marine and life science sectors.

Cost of Materials:

Cost of materials (exclusive of depreciation and amortization) were ~~$779.2~~$779.2 million, in 2013, a decrease of ~~$148.1~~$148.1 million,, or 16.0%, compared to 2012. Material costs for the Metals segment were $683.3 million, or 74.4% as a percent of net sales, in 2013 compared to $836.3 million, or 73.1% as a percent of net sales, in 2012. The 2013 results ~~include~~included a $2.1 million charge associated with net realized and unrealized losses for forward contracts related to the commodity hedging program compared to a $0.4 million charge in 2012. Cost of materials for the Metals segment ~~include~~included a LIFO credit of $8.6 million in 2013 compared to a LIFO charge of $1.1 million in 2012. In addition, 2013 cost of materials included ~~$1.2~~$1.2 million of charges related to the write off of inventory as part of the Company's restructuring activities that were announced in January 2013. The remaining decrease in cost of materials for the Metals segment iswas consistent with the sales volume decrease year-over-year.

Material costs for the Plastics segment were 71.1% as a percent of net sales in 2013 as compared to 71.9% ~~for~~ in 2012 due to higher costs experienced in the automotive sector of the business, which were more than offset by an increase in revenues.

Operating Costs and Expenses and Operating (Loss) Income:

Operating costs and expenses for 2013 decreased ~~$13.7~~$13.7 million,, or 4.5%, compared to ~~last year.~~2012. Operating costs and expenses for 2013, including restructuring activity charges of $9.0 million, were ~~$289.6~~$289.6 million,, or 27.5% as a percent of net sales, compared to ~~$303.3~~$303.3 million,, or 23.9% as a percent of net sales, in 2012. While operating expense dollars, including $9.0 million of restructuring charges, decreased in 2013 compared to 2012, operating expenses as a percentage of sales ~~are~~were 15.1% higher than 2012 primarily due to the decline in sales.

The decrease in operating expenses for 2013 compared to 2012 primarily relates to the following:

Warehouse, processing and delivery costs decreased by $7.3 million to $140.9 million, or 13.4% as a percent of net sales, primarily as a result of the decrease in sales activity in the Metals segment in 2013 and cost decreases resulting from the ~~recent~~2013 restructuring activities.

Sales, general and administrative costs decreased by $15.8 million to $113.4 million, or 10.8% as a percent of net sales, primarily as a result of a ~~decline of~~ $9.0 million decline in compensation and benefits costs of which $7.7 million iswas attributable to the Company's ~~recent~~2013 restructuring activities and the remainder iswas due to lower other compensation and benefits;

Restructuring activity charges increased by $9.0 million due to ~~restructuring activities related to~~ the restructuring actions taken during ~~the year.~~2013. As part of the Company's efforts to adapt operations to market conditions, a restructuring plan related to the Company's organizational structure and operations was announced during January of 2013. In October 2013, the Company announced the consolidation of four additional facilities in locations where it ~~has~~had redundant operations as part of its continuous improvement plans to lower structural operating costs. There were no restructuring activity charges included in operating costs and expenses ~~for~~ ~~2012~~.in 2012. The restructuring activity charges impacting operating expenses were cash charges and were in-line with the Company's expectations. The Company anticipates an improvement to annualized operating profit of approximately $33 million beginning in 2014 related to the January 2013 announced restructuring activities. The Company estimates a $9 million reduction of annual operating expenses from the October 2013 announced restructuring activities starting in fiscal 2015 when the restructuring plan is fully executed. For more information on the Company's restructuring ~~charges,~~activities, see Note 1410 - Restructuring Activity to the Consolidated Financial ~~Statements in Item 8;~~Statements; and

Depreciation and amortization expense in 2013was $0.3 million higher than ~~2012~~.2012.

Consolidated operating loss for 2013 was ~~$15.7~~$15.7 million compared to operating income of ~~$39.8~~$39.8 million in ~~2012~~.2012.

Other Income and Expense, Income Taxes and Net Loss:

Interest expense was $43.1 million in 2013, a decrease of $13.5 million compared to 2012 as a result of the $15.6 million unrealized loss for the mark-to-market adjustment on the conversion option associated with the ~~convertible notes~~Convertible Notes that was recognized in 2012,, partially offset by a $2.6 million loss on extinguishment onof $15.0 million of the Company’s

Senior Secured Notes ~~of $2.6 million~~that was recorded in 2013. There was no such loss on extinguishment of debt recognized in ~~2012~~.2012.

Other expense related to foreign currency transaction losses was $1.9 million in 2013 compared to $1.3 million of other income related to foreign currency transaction gains for 2012. The majority of these transaction losses and gains related to unhedged intercompany financing arrangements between the United States and the United Kingdom and Canada.

The Company recorded an income tax benefit of ~~$19.8~~$19.8 million in 2013 compared to income tax expense of ~~$1.4~~$1.4 million in ~~2012~~.2012. The Company’s effective tax rate is expressed as ~~‘Income taxes’,~~'Income taxes,' which includes tax expense on the Company’s share of joint venture earnings, as a percentage of ~~‘Loss~~'Loss before income taxes and equity in earnings of joint venture.’' This calculation includes taxes on the joint venture income but excludes joint venture income. The effective tax rate for 2013 and 2012 was 32.6% and (9.2)%, respectively. The change in the effective tax rate for 2013 compared to 2012 was primarily the result of the non-deductibility of the unrealized loss on the conversion option associated with the convertible debt in 2012 and a change in the geographical mix of income (loss).

~~Equity in earnings of the Company’s joint venture was~~ ~~$7.0 million~~ ~~in 2013 compared to~~ ~~$7.2 million~~ in ~~2012. The decrease is a result of lower demand in many of the joint venture’s end-use markets compared to the prior year.~~

~~Consolidated net loss for 2013 was~~ ~~$34.0 million, or~~ ~~$1.46~~ ~~per diluted share, compared to net loss of~~ ~~$9.7 million, or~~ ~~$0.42~~ ~~per diluted share, for~~ ~~2012~~.

~~2012 Results Compared to 2011~~

~~As a result of the acquisition of Tube Supply in December 2011, the full year results were included in the Company's Metals segment during 2012.~~

~~Consolidated results by business segment are summarized in the following table for years 2012 and 2011.~~

~~Operating Results by Segment~~

Year Ended December 31, Favorable / (Unfavorable)
2012 2011 $ Change % Change
Net Sales
Metals $ 1,143.9
$ 1,014.2
$ 129.7
12.8 %
Plastics 126.5
118.2
8.3
7.0 %
Total Net Sales $ 1,270.4
$ 1,132.4
$ 138.0
12.2 %
Cost of Materials
Metals $ 836.3
$ 763.0
$ (73.3 ) (9.6 )%
% of Metals Sales 73.1 % 75.2 %
Plastics 91.0
82.6
(8.4 ) (10.2 )%
% of Plastics Sales 71.9 % 69.9 %
Total Cost of Materials $ 927.3
$ 845.6
$ (81.7 ) (9.7 )%
% of Total Sales 73.0 % 74.7 %
Operating Costs and Expenses
Metals $ 259.1
$ 237.0
$ (22.1 ) (9.3 )%
Plastics 32.3
32.7
0.4
1.2 %
Other 11.9
11.2
(0.7 ) (6.3 )%
Total Operating Costs and Expenses $ 303.3
$ 280.9
$ (22.4 ) (8.0 )%
% of Total Sales 23.9 % 24.8 %
Operating Income (Loss)
Metals $ 48.5
$ 14.2
$ 34.3
241.5 %
% of Metals Sales 4.2 % 1.4 %
Plastics 3.2
2.9
0.3
10.3 %
% of Plastics Sales 2.5 % 2.5 %
Other (11.9 ) (11.2 ) (0.7 ) (6.3 )%
Total Operating Income $ 39.8
$ 5.9
$ 33.9
574.6 %
% of Total Sales 3.1 % 0.5 %

~~“Other” includes costs of executive, legal and finance departments which are shared by both segments of the Company.~~

~~Net Sales:~~

Consolidated net sales were $1,270.4 million in 2012, an increase of $138.0 million, or 12.2%, versus 2011. Metals segment net sales during 2012 of $1,143.9 million were $129.7 million, or 12.8%, higher than 2011. Tube Supply contributed net sales of $178.5 million in 2012 compared to $7.6 million for the two-week period ended December 31, 2011. Excluding Tube Supply results, net sales for the Metals segment were $41.2 million lower in 2012 compared to 2011. Lower net sales were primarily the result of lower shipping volumes. Average tons sold per day, excluding Tube Supply, decreased 3.9% compared to the prior year. The decrease in demand experienced in 2012 was driven primarily by SBQ bar, carbon bar and aluminum products. Excluding Tube Supply, gains in the oil and gas business were offset by weakness in the industrial business in 2012 compared to 2011.

~~Plastics segment net sales during 2012 of $126.5 million were $8.3 million, or 7.0%, higher than 2011 primarily due to increased sales volume, reflecting strength in the automotive sector.~~

~~Cost of Materials:~~

Cost of materials (exclusive of depreciation and amortization) were $927.3 million, an increase of $81.7 million, or 9.7%, compared to 2011. Material costs for the Metals segment were $836.3 million or 73.1% as a percent of net sales compared to $763.0 million or 75.2% as a percent of net sales in 2011. Tube Supply cost of materials were $118.7 million in 2012 compared to $5.3 million for the two-week period ended December 31, 2011. During 2011, the Company implemented a commodity hedging program to mitigate the risks associated with certain commodity price fluctuations. The 2012 results include a $0.4 million charge associated with the realized and unrealized losses for forward contracts related to the commodity hedging program compared to a $2.4 million charge in 2011. Cost of materials for the Metals segment include a LIFO charge of $1.1 million in 2012 compared to $15.1 million in 2011. The remaining increase in cost of materials for the Metals segment is consistent with the sales volume increase year-over-year.

~~Material costs for the Plastics segment were 71.9% as a percent of net sales in 2012 as compared to 69.9% for 2011 due to higher costs experienced in the automotive sector of the business.~~

~~Operating Costs and Expenses and Operating Income (Loss):~~

~~Operating costs and expenses increased $22.4 million, or 8.0%, compared to 2011. Operating costs and expenses for 2012~~ were $303.3 million, or 23.9% as a percent of net sales, compared to $280.9 million, or 24.8% as a percent of net sales in 2011. Operating costs related to Tube Supply were $32.9 million in 2012 compared to $0.9 million in 2011.

During the second quarter of 2012, the Company incurred costs associated with executive employment transition in the amount of $1.6 million. As a result of the transition, share-based awards were forfeited, which resulted in a significant increase in the Company’s forfeiture rate. The increase in the forfeiture rate estimate associated with the active Long-term Compensation Plans resulted in a decrease in sales, general and administrative cost of approximately $1.0 million. The net impact of the employment transition costs on sales, general and administrative expense was approximately $0.6 million.

~~The increase in operating expenses for 2012 compared to 2011 primarily relates to the following:~~

Warehouse, processing and delivery costs increased by $13.4 million of which a $15.6 million increase is associated with the increase for Tube Supply for the period. The Tube Supply impact was offset by a $2.2 million decrease primarily attributed to a decline in workers’ compensation, overtime wage, temporary employee and utilities costs, partially offset by an increase in compensation and benefits expense as a result of headcount, merit and healthcare cost increases and rent expense due to a full year of expense for the expanded facility in Mexico, which was substantially completed in 2011 and rent expense for the new facility in Trafford Park, United Kingdom during 2012;

Sales, general and administrative costs increased by $3.6 million of which a $9.8 million increase is associated with the increase for Tube Supply for the period. The net impact of the CEO transition costs of $0.6 million and an increase to bad debt reserves for customer bankruptcies of $0.8 million were included in the 2012 results. The 2011 results include a $0.9 million charge for export penalties related to product shipments that occurred from 2005 to 2008 and $4.3 million for charges related to the acquisition of Tube Supply. The remaining decrease of $2.4 million is primarily attributed to a decline in incentive compensation and other compensation and benefits costs, partially offset by an increase in workers' compensation and outside services costs; and

~~Depreciation and amortization expense was $5.4 million higher than 2011 primarily due to the depreciation and amortization of Tube Supply’s fixed and intangible assets acquired in December 2011.~~

~~Consolidated operating income for 2012 was $39.8 million compared to $5.9 million in 2011.~~

~~Other Income and Expense, Income Taxes and Net Loss:~~

Interest expense was $56.7 million in 2012, an increase of $36.9 million versus 2011 as a result of interest charges on the Company’s new senior secured and convertible notes, as well as the unrealized loss for the mark-to-market adjustment on the conversion option associated with the convertible notes.

~~The increase in interest expense for 2012 compared to 2011 is a result of the following:~~

Increase for the non-cash interest charge of $11.6 million associated with the mark-to-market adjustment on the conversion option associated with the convertible notes, which is not deductible for federal income tax purposes;

~~Increase for interest on senior secured and convertible notes of $31.0 million; and~~

~~Increase for amortization of deferred financing fees and debt discount of $1.1 million.~~

In addition to items above, there was a loss on extinguishment of the Company’s existing long-term notes of $6.2 million and a charge for underwriting fees associated with the debt financing of $3.4 million recorded in 2011.

Other income related to foreign currency transaction gains was $1.3 million in 2012 compared to $0.7 million of other expense related to foreign currency transaction losses for 2011. The majority of these transaction gains and losses related to unhedged intercompany financing arrangements between the United States and the United Kingdom and Canada.

The Company recorded income tax expense of $1.4 million in 2012 compared to a tax benefit of $1.1 million in 2011. The Company’s effective tax rate is expressed as ‘Income tax benefit’ (which includes tax expense on the Company’s share of joint venture earnings) as a percentage of ‘Loss before income taxes and equity in earnings of joint venture.’ This calculation includes taxes on the joint venture income but excludes joint venture income. The effective tax rate for 2012 and 2011 was (9.2)% and 7.7%, respectively. The change in the effective tax rate for 2012 compared to 2011 was primarily the result of the non-deductibility of the change in the mark-to-market adjustment on the conversion option associated with the convertible notes in the amount of $11.6 million.

Equity in earnings of the Company’s joint venture was $7.0 million in 2013 compared to $7.2 million in ~~2012 compared to $11.7 million in 2011.~~2012. The decrease iswas a result of lower demand in ~~virtually all of the joint venture’s end-use markets~~2013 compared to ~~2011.~~2012.

Consolidated net loss for ~~2012~~2013 was ~~$9.7~~$34.0 million, or ~~$0.42~~$1.46 per diluted share, compared to net loss of ~~$1.8~~$9.7 million, or ~~$0.08~~$0.42 per diluted share, for ~~2011.~~2012.

Liquidity and Capital Resources

Cash and cash equivalents increased (decreased) as follows:


	Year ended December 31,									Year ended December 31,
	2013			2012			2011			2014			2013			2012
Net cash from (used in) operating activities	$	74.4		$	5.4		$	(46.3	)
Net cash (used in) from operating activities										$	(75.1	)	$	74.4		$	5.4
Net cash used in investing activities	(10.8		)	(17.4		)	(185.2		)	(4.9		)	(10.8		)	(17.4		)
Net cash from (used in) financing activities	(53.9		)	2.9			225.5			58.2			(53.9		)	2.9
Effect of exchange rate changes on cash and cash equivalents	(0.5		)	0.2			(0.2		)	(0.6		)	(0.5		)	0.2
Net increase (decrease) in cash and cash equivalents	$	9.2		$	(8.9	)	$	(6.2	)
Net (decrease) increase in cash and cash equivalents										$	(22.4	)	$	9.2		$	(8.9	)

The Company’s principal sources of liquidity are cash provided by operations and available borrowing capacity to fund working capital needs and growth initiatives. Specific components of the change in working capital are highlighted below:

During 2014, higher accounts receivable balances compared to year-end 2013 resulted in $5.8 million of cash ~~receipts from customers exceeded net sales resulting in~~flow use compared to a $9.3 million cash flow source ~~due to a decrease in accounts receivable compared to a~~ ~~$44.6 million~~ ~~cash flow source~~ for ~~2012. Net sales decreased~~ ~~17.1%~~ ~~from 2012.~~2013. Average receivable days outstanding was ~~51.1~~52.1 for ~~2013~~2014 and ~~49.0~~51.1 days for ~~2012.~~2013.

During 2014, higher inventory levels compared to year-end 2013 ~~sales~~used $26.9 million of cash compared to lower inventory ~~exceeded inventory purchases resulting in a~~levels that were an $87.3 million cash flow source in 2013. The Company's inventory levels were elevated at the end of 2012, resulting in substantial inventory reductions throughout 2013. Inventory levels increased during 2014 due to ~~a decrease~~certain discrete initiatives as well as forecasting policies and purchase plans not being aligned with unfavorable changes in ~~inventory compared to a~~ ~~$29.3 million~~ ~~cash flow use due to an increase in inventory in 2012.~~market dynamics. Average days sales in inventory was 174.2 days for 2014 versus 180.0 days for ~~2013 versus 187.0 days for 2012.~~2013. The Company expects normal days sales in inventory to be approximately 150 days based on historical sales. As the Company focuses on decreasing inventory in 2015 through better alignment and execution of its purchase plans with current market dynamics, it expects days sales in inventory to return to more normal levels.

During ~~2013, cash paid for inventories and other goods and services exceeded purchases resulting in a $3.3 million cash flow use due to a net decrease~~2014, decreases in accounts payable and accrued liabilities used $0.9 million of cash compared to ~~a $38.0~~the use of $3.3 million of cash ~~flow use for 2012.~~in 2013. Accounts payable days outstanding was ~~39.9~~43.0 for ~~2013~~2014 and ~~53.1~~39.9 for ~~2012.~~2013.

The Company received its 2013 federal income tax refund of $1.5 million in October 2014, its 2012 federal ~~income~~ tax refund of $2.6 million during October 2013 and its 2010 federal tax refund of $2.0 million during February ~~2012 and its 2009 federal income tax refund of~~ ~~$6.3 million~~ ~~during January 2011.~~2012.

~~In December 2011, in conjunction with the acquisition of Tube Supply, the~~The Company issued $225.0 million aggregate principal amount of 12.75% Senior Secured Notes due 2016, $57.5 million aggregate principal amount of 7.0% Convertible Senior Notes due 2017 and entered into a $100.0 millionobtained an extension on its senior secured asset based revolving credit facility (the ~~“Revolving~~"Revolving Credit ~~Facility”~~Facility")~~. Net proceeds~~ in December 2014, which extended the maturity date from December 15, 2015 to December 10, 2019 (or 91 days prior to the maturity date of ~~$304.6 million were used to complete~~ the Tube Supply acquisition, pay-off amounts outstanding under our previous credit agreement and for general corporate purposes. In November 2013, the Company purchased $15.0 million aggregate principal amount of itsCompany's Senior Secured Notes or Convertible Notes if they have not been refinanced). In January 2014, the Company partially exercised the accordion option under the Revolving Credit Facility to increase the aggregate commitments by $25.0 million. As a result, the Company's borrowing capacity increased from $100.0 million to $125.0 million. The Company maintains the option to exercise the accordion for an additional $25.0 million of aggregate commitments in the ~~open market with available cash. The Senior Secured Notes that were purchased by~~future, assuming it meets certain thresholds for incurring additional debt.

Historically, the Company were subsequently retired. The purchase of the Senior Secured Notes resulted in a pre-tax loss on debt extinguishment of $2.6 million consisting of tender premiums, write off of unamortized debt issuance costs and tender expenses.

~~The~~ Company’s primary uses of liquidity and capital resources have been capital expenditures, payments on debt (including interest payments) and acquisitions. Management believes the Company will be able to generate sufficient cash from operations and planned working capital improvements to fund its ongoing capital expenditure programs and meet its debt obligations for at least the next twelve months. Furthermore, the Company has available borrowing capacity under the Revolving Credit Facility. The Company's debt agreements impose significant operating and financial restrictions which may prevent the Company from executing certain business opportunities such as, making acquisitions or paying dividends, among other things. The Revolving Credit Facility contains a springing financial maintenance covenant requiring the Company to maintain the ratio ~~of EBITDA~~ (as defined in the ~~agreement)~~Revolving Credit Facility Loan and Security Agreement) of EBITDA to fixed charges of 1.1 to 1.0 when excess availability is less than the greater of 10% of the calculated borrowing base (as defined in the ~~agreement)~~Revolving Credit Facility Loan and Security Agreement) or ~~$10~~$12.5 million. In addition, if excess availability is less than the greater of 12.5% of the calculated borrowing base (as defined in the ~~agreement)~~Revolving Credit Facility Loan and Security Agreement) or ~~$12.5~~$15.6 million, the lender has the right to take full dominion of the Company’s cash collections and apply these proceeds to outstanding loans under the Revolving Credit ~~Facility~~Agreement (“~~cash dominion”~~Cash Dominion”). The Company's ratio of EBITDA to fixed charges was negative for the year ended December 31, 2014. At this negative ratio, the Company's current maximum borrowing capacity is $100.4 million before triggering Cash Dominion. Based on the Company’s cash projections, it does not anticipate a scenario whereby ~~cash dominion~~Cash Dominion would occur during the next twelve months.

Additional unrestricted borrowing capacity under the Revolving Credit Facility at December 31, 2014 was as follows:



Maximum borrowing capacity	$	125.0
Borrowings	(59.2		)
Minimum excess availability before triggering Cash Dominion	(15.6		)
Letters of credit and other reserves	(9.0		)
Additional unrestricted borrowing capacity	$	41.2

The Company is committed to maintaining a strong financial position through maintaining sufficient levels of available liquidity, managing working capital and monitoring the Company’s overall capitalization. Cash and cash equivalents at December 31, ~~2013~~2014 were $~~30.8~~8.5 million ~~and the Company had $90.3~~with approximately $2.3 million ~~of available borrowing capacity under its New Revolving Credit Facility. Approximately 30%~~ of the Company’s consolidated cash and cash equivalents balance ~~resides~~residing in the United States. As foreign earnings are permanently reinvested, availability under the Company’s ~~New~~ Revolving Credit Facility would be used to fund operations in the United States should the need arise in the future.

In January 2014, the Company partially exercised the accordion option under its revolving credit facility to increase the aggregate commitments by $25.0 million. As a result, the Company's borrowing capacity increased from $100.0 million to $125.0 million, and the Company maintains the ability to exercise the accordion for an additional $25.0 million of aggregate commitments in the future.

Working capital, defined as current assets less current liabilities, and the balances of its significant components ~~are~~were as follows:


	December 31,							December 31,				Working Capital
	2013		2012		Increase (Decrease)			2014		2013		Increase (Decrease)
Working capital	$	289.4	$	379.3	$	(89.9	)	$	291.9	$	289.4	$	2.5
Inventory	214.9		303.8		(88.9		)	236.9		214.9		22.0
Accounts receivable	128.5		138.3		(9.8		)	131.0		128.5		2.5
Accrued liabilities								18.3		20.2		1.9
Accrued payroll and employee benefits								9.3		9.9		0.6
Cash and cash equivalents	30.8		21.6		9.2			8.5		30.8		(22.3		)
Accrued liabilities	20.2		24.8		(4.6		)
Income tax receivable	3.2		7.6		(4.4		)
Deferred income taxes								0.7		3.2		(2.5		)

The Company monitors its overall capitalization by evaluating total debt to total capitalization. Total debt to total capitalization is defined as the sum of short-term and long-term debt, divided by the sum of total debt and stockholders’ equity. Total debt to total capitalization was 67.4% at December 31, 2014 and 44.3% at December 31, 2013 ~~and 46.8% at~~ ~~December 31, 2012~~. ~~Over the long-term, the~~The Company plans ~~to continue~~ to improve its total debt to total capitalization by ~~improving operating results, managing working capital~~reducing debt through improved inventory and ~~using cash generated from operations to repay outstanding debt.~~supplier management. As and when permitted by term of agreements noted above, depending on market conditions, the Company may decide in the future to refinance, redeem or repurchase its debt and take other steps to reduce its debt or lease obligations or otherwise improve its overall financial position and balance sheet.

In February 2015, the Company engaged a nationally recognized consulting firm to assist the Company with enhancing its profitability as well as improving its overall liquidity. The actions that are ultimately taken to achieve these objectives

may result in future cash and/or non-cash charges. At this time, an estimate of such costs, or whether they will be incurred at all, is not available as the performance improvement plan is still in the process of being developed.

The Company's credit ratings are periodically reviewed by Moody's Investors Services and Standard and Poor's. With respect to the Company's 12.75% Senior Secured Notes, the most recent agency debt ratings ~~as of~~ ~~December 31, 2013~~ ~~were~~are as follows:



	Senior Debt Rating	Outlook
Moody's Investors Services	~~Caa1~~Caa2	~~Stable~~Negative
Standard & Poor's	B-CCC+	~~Stable~~Negative

In October 2014, Moody's Investor Services downgraded the Company's senior debt rating to Caa2 from Caa1 and revised the Company's outlook to negative from stable. In August 2014, Standard & Poor's revised the Company's outlook to negative from stable and affirmed the Company's B- senior debt rating. In February 2015, Standard & Poor's downgraded the Company's senior debt rating to CCC+ from B- and affirmed the Company's negative outlook. While the agency debt ratings do not result in the Company being in violation of any debt covenants or require it to take any other specified actions, a ratings downgrade could negatively impact the Company's ability to refinance existing debt or increase the cost to refinance its debt. The above ratings are not a recommendation to buy, sell or hold securities. These ratings may be subject to revision or withdrawal at any time by the assigning rating organization, and each rating should be evaluated independently of any other rating.

Capital Expenditures

Cash paid for capital expenditures for ~~2013~~2014 was $~~11.6~~12.4 million compared to $~~11.1~~11.6 million in ~~2012~~2013. The expenditures during ~~2013~~2014 were comprised of approximately ~~$1.6~~$2.0 million for new facilities located in Singapore and Mexico, $1.4 million related to facility consolidations and $1.0 million for the expansion of existing facilities to accommodate additional throughput related to the consolidation of operations in locations where the Company has a redundant footprint and $1.1 million of information technology enhancements.Company's e-commerce platform. The balance of the capital expenditures in ~~2013~~2014 are the result of normal equipment, building improvement and furniture and fixture upgrades throughout the year. Management believes that capital expenditures will ~~approximate $14~~be approximately $8.0 million to $10.0 million in ~~2014.~~2015.

Contractual Obligations and Other Commitments

The following table includes information about the Company’s contractual obligations that impact its short-term and long-term liquidity and capital needs. The table includes information about payments due under specified contractual obligations and is aggregated by type of contractual obligation. It includes the maturity profile of the Company’s consolidated long-term debt, operating leases and other long-term liabilities.

At December 31, ~~2013~~2014, the Company’s contractual obligations, including estimated payments by period, were as follows:


Payments Due In	Total		Less Than One Year		One to Three Years		Three to Five Years		More Than Five Years		Total		Less Than One Year		One to Three Years		Three to Five Years		More Than Five Years
Long-term debt obligations (excluding capital lease obligations)(a)	$	267.5	$	—	$	210.0	$	57.5	$	—	$	326.7	$	—	$	267.5	$	59.2	$	—
Interest payments on debt obligations ~~(a)~~(b)	96.4		30.8		61.6		4.0		—		74.8		32.7		38.5		3.6		—
Capital lease obligations	1.0		0.4		0.6		—		—		1.3		0.8		0.5		—		—
Operating lease obligations	73.1		13.5		22.5		17.2		19.9		78.4		14.1		23.8		17.1		23.4
Purchase obligations ~~(b)~~(c)	194.0		194.0		—		—		—		285.1		260.7		24.4		—		—
Other ~~(c)~~(d)	7.1		7.1		—		—		—		5.5		5.5		—		—		—
Total	$	639.1	$	245.8	$	294.7	$	78.7	$	19.9	$	771.8	$	313.8	$	354.7	$	79.9	$	23.4


a)	Borrowings outstanding on the Company's Revolving Credit Facility due December 10, 2019 will become due 91 days prior to the maturity date of the Company's $210.0 million Senior Secured Notes due December 15, 2016 or $57.5 million Convertible Notes due December 15, 2017 if they have not been refinanced.

Interest payments on debt obligations represent interest on all Company debt outstanding as of December 31, ~~2013~~.2014. The ~~Company had no outstanding~~interest payment amounts related to the variable rate component of the Company's debt assume that interest will be paid at the rates prevailing at December 31, ~~2013~~.2014. Future interest rates may change and actual interest payments could differ from those disclosed in the table above.


b)c)	Purchase obligations consist of raw material purchases made in the normal course of business. The Company has contracts to purchase minimum quantities of material with certain suppliers. For each contractual purchase obligation, the Company generally has a purchase agreement from its customer for the same amount of material over the same time period.

c)d)

~~‘Other’~~Other is comprised of deferred revenues that represent commitments to deliver products and obligations related to recognizing and measuring tax positions taken or expected to be taken in a tax return that directly or indirectly affect amounts reported in financial statements. The uncertain tax positions included in the Company’s obligations are related to temporary differences and uncertain tax positions where the Company anticipates a high probability of settlement within a given timeframe. The years for which the temporary differences related to the uncertain tax positions will reverse have been estimated in scheduling the obligations within the table.products.

The table and corresponding footnotes above do not include ~~$22.9~~$30.8 million of non-current liabilities recorded on the consolidated balance sheets. These non-current liabilities consist of ~~$6.6~~$18.7 million of liabilities related to the Company’s non-funded ~~supplemental~~ pension ~~plan~~ and postretirement benefit plans for which payment periods cannot be determined. Non-current liabilities also include ~~$10.7~~$8.4 million of deferred income taxes and ~~$5.6~~$3.7 million of other non-current liabilities, which were excluded from the table as the amounts due and timing of payments (or receipts) at future contract settlement dates cannot be determined.

Pension Funding

The Company’s funding policy on its defined benefit pension plans is to satisfy the minimum funding requirements of the Employee Retirement Income Security Act (“ERISA”). Future funding requirements are dependent upon various factors outside the Company’s control including, but not limited to, fund asset performance and changes in regulatory or accounting requirements. Based upon factors known and considered as of December 31, ~~2013~~2014, the Company does not anticipate making significant cash contributions to the pension plans in ~~2014.~~2015.

The investment target portfolio allocation for the Company-sponsored pension plans and supplemental pension plan focuses primarily on corporate fixed income securities that match the overall duration and term of the Company’s pension liability structure. Refer to “Retirement Plans” within Critical Accounting Policies and Note 59 - Employee Benefit Plans to the ~~consolidated financial statements~~Consolidated Financial Statements for additional details regarding other plan assumptions.

Off-Balance Sheet Arrangements

With the exception of letters of credit and operating lease financing on certain equipment used in the operation of the business, it is not the Company’s general practice to use off-balance sheet arrangements, such as third-party special-purpose entities or guarantees of third parties.

As of December 31, ~~2013~~2014, the Company had ~~$6.7~~$5.8 million of irrevocable letters of credit outstanding which primarily consisted of ~~$4.0~~$3.0 million for collateral associated with commodity hedges and ~~$1.9~~$1.8 million for compliance with the insurance reserve requirements of its workers’ compensation insurance carriers.

closed its facility in Gardena, California and elected to withdraw from the California multi-employer pension plan. The Company incurred a withdrawal liability of $0.7 million which was charged to expense in ~~2013~~ ~~within "Restructuring Charges" in the Consolidated Statement of Operations.~~ If the Company elects to withdraw from the Ohio multi-employer pension plan in the future, it could potentially incur a withdrawal liability at that time. The Ohio multi-employer pension plan withdrawal liability was estimated to be ~~$4.8~~$5.4 million as of December 31, ~~2013~~2014. The Company was party to a multi-employer pension plan in California. In 2013, in connection with the January 2013 restructuring plan, the

Company closed its facility in Gardena, California and elected to withdraw from the California multi-employer pension plan. The Company incurred a withdrawal liability of $0.7 million which was charged to expense in 2013 within "Restructuring activity" in the Consolidated Statement of Operations.

Obligations of the Company associated with its leased equipment are disclosed under the ~~“Contractual~~Contractual Obligations and Other ~~Commitments” section above.~~Commitments section.

Critical Accounting Policies

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, and include amounts that are based on management’s estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The following is a description of the Company’s accounting policies that management believes require the most significant judgments and estimates when preparing the Company’s consolidated financial statements:

Revenue Recognition — Revenue from the sale of products is recognized when the earnings process is complete and when the title and risk and rewards of ownership have passed to the customer, which is primarily at the time of shipment. Revenue recognized other than at time of shipment represented less than 3%2% of the Company’s consolidated net sales for the years ended December 31, 2014, 2013 ~~2012~~ and ~~2011.~~2012. Revenue from shipping and handling charges is recorded in net sales. Provisions for allowances related to sales discounts and rebates are recorded based on terms of the sale in the period that the sale is recorded. Management utilizes historical information and the current sales trends of the business to estimate such provisions. Actual results could differ from these estimates. The provisions related to discounts and rebates due to customers are recorded as a reduction within net sales in the Company’s consolidated statements of operations and comprehensive loss.

The Company maintains an allowance for doubtful accounts related to the potential inability of our customers to make required payments. The allowance for doubtful accounts is maintained at a level considered appropriate based on historical experience and specific identification of customer receivable balances for which collection is unlikely. The provision for doubtful accounts is recorded in sales, general and administrative expense in the Company’s consolidated statements of operations and comprehensive loss. Estimates of doubtful accounts are based on historical write-off experience as a percentage of net sales and judgments about the probable effects of economic conditions on certain customers, which can fluctuate significantly from year to year. The Company cannot be certain that the rate of future credit losses will be similar to past experience.

The Company also maintains an allowance for credit memos for estimated credit memos to be issued against current sales. Estimates of allowance for credit memos are based upon the application of a historical issuance lag period to the average credit memos issued each month. If actual results differ significantly from historical experience, there could be a negative impact on the Company’s operating results.

Income Taxes — The Company’s income tax expense, deferred tax assets and liabilities and reserve for uncertain tax positions reflect management’s best estimate of taxes to be paid. The Company is subject to income taxes in the U.S. and several foreign jurisdictions. The determination of the consolidated income tax expense requires judgment and estimation by management. It is possible that actual results could differ from the estimates that management has used to determine its consolidated income tax expense.

The Company accounts for deferred income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statement and the tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

Valuation allowances are recorded against deferred tax assets when it is more likely than not that the amounts will not be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies and recent results of operations. In the event the Company determines it would not be able to realize its deferred tax assets, a valuation allowance is recorded, which increases the provision for income taxes in the period in which that determination is made. ~~As of December 31, 2013, the Company concluded that it was more likely than not that it would realize its deferred tax assets and no valuation allowance was deemed necessary.~~

The Company ~~has~~continued to generate losses at a number of its foreign subsidiaries in 2014. The larger than expected 2014 losses, when combined with prior losses and future income projections, indicated that it was more likely than not that deferred tax assets of these foreign subsidiaries would not be realized. During 2014, a valuation allowance of $2.7 million was recorded against all the previously existing deferred tax assets of these subsidiaries. The deferred tax assets of these foreign subsidiaries are comprised primarily of net operating loss carry forwards. Additionally, losses generated by these foreign subsidiaries during the year ended December 31, 2014 were not benefited nor are future losses expected to be benefited until these subsidiaries return to profitability and evidence suggests that it is more likely than not that the deferred tax assets will be realized. The impact on the income tax provision of not benefiting the losses was approximately $2.1 million for the year ended December 31, 2014.

In the U.S., the Company was in a net deferred tax asset position as of December 31, 2014. The Company did not have sufficient sources of projected income to cover the net deferred tax asset as of December 31, 2014. Therefore, the Company recorded a valuation allowance and did not provide a tax benefit on a portion of the losses generated by the U.S. during the year ended December 31, 2014. The impact on the income tax provision of not benefiting the losses was approximately $28.1 million for the year ended December 31, 2014. Continued operating losses in future periods and changes to the sources of income identified to utilize the U.S. deferred tax assets that differ significantly from current estimates may result in additional benefits not being recognized and a valuation allowance being recorded against the remaining U.S. deferred tax assets. The Company did not record valuation allowances against its U.S. deferred tax assets for the year ended December 31, 2013 as the U.S. had sufficient deferred tax liabilities to cover net operating losses.

The valuation allowances in the U.S. and at certain foreign subsidiaries will not be reversed until the Company returns to profitability and determines that it is more likely than not that its deferred tax assets will be realized.

The Company had undistributed earnings of foreign subsidiaries of approximately ~~$83.1~~$48.6 million at December 31, ~~2013,~~2014, for which deferred taxes have not been provided. Such earnings are considered indefinitely invested in the foreign subsidiaries. If such earnings were repatriated, additional tax expense may result, although due to the potential availability of foreign tax credits and other items, the calculation of such potential taxes is not practicable.

The Company’s investment in the joint venture is through a 50% interest in a limited liability corporation (LLC) taxed as a partnership. The joint venture has two subsidiaries organized as individually taxed C-Corporations. The Company includes in its income tax provision the income tax liability on its share of the income of the joint venture and its subsidiaries. The income tax liability of the joint venture itself is generally treated as a current income tax expense and the income tax liability associated with the profits of the two subsidiaries of the joint venture is treated as deferred income tax expense. The Company ~~can not~~cannot independently cause a dividend to be declared by one of the subsidiaries of the joint venture, therefore no benefit of a dividend received deduction can be recognized in the Company's tax provision until a dividend is declared. If one of the C-Corporation subsidiaries of the joint venture declares a dividend payable to the joint venture, the Company recognizes a benefit for the 80% dividends received deduction on its 50% share of the dividend.

For uncertain tax positions, the Company applies the provisions of relevant authoritative guidance, which requires application of a “more likely than not” threshold to the recognition and derecognition of tax positions. The Company’s ongoing assessments of the more likely than not outcomes of tax authority examinations and related tax positions require significant judgment and can increase or decrease the Company’s effective tax rate as well as impact operating results. Although the Company believes that the positions taken on previously filed tax returns are reasonable, it has established tax and interest reserves in recognition that various taxing authorities may challenge the positions taken, which could result in additional liabilities for taxes and interest.

Retirement Plans — The Company values retirement plan liabilities based on assumptions and valuations established by management. Future valuations are subject to market changes, which are not in the control of the Company and could differ materially from the amounts currently reported. The Company evaluates the discount rate and expected return on assets at least annually and evaluates other assumptions involving demographic factors, such as retirement age, mortality and turnover periodically, and updates them to reflect actual experience and expectations for the future. Actual results in any given year will often differ from actuarial assumptions because of economic and other factors.

Accumulated and projected benefit obligations are expressed as the present value of future cash payments which are discounted using the weighted average of market-observed yields for high quality fixed income securities with maturities that correspond to the payment of benefits. Lower discount rates increase present values and subsequent-year pension expense; higher discount rates decrease present values and subsequent-year pension expense. Discount rates used for determining the Company’s projected benefit obligation for ~~retirement~~its pension plans were ~~4.50%~~3.75% and ~~3.50 - 3.75%~~4.50% at December 31, ~~2013~~2014 and ~~2012~~2013, respectively.

The Company’s pension plan asset portfolio as of December 31, ~~2013~~2014 is primarily invested in fixed income securities with a duration of approximately 1112 years. The assets generally fall within Level 2 of the fair value hierarchy. Assets in the Company’s pension plans have earned approximately 9%10% since 2008 when the Company changed its target investment allocation to focus primarily on fixed income securities. The target investment asset allocation for the pension plans’ funds focuses primarily on corporate fixed income securities that match the overall duration and term of the Company’s pension liability structure. As of December 31, ~~2013~~ ~~and~~ ~~2012~~2014, ~~the~~there was a funding deficit of approximately 5% compared to a funding surplus ~~was~~of approximately 7% at December 31, 2013. The change in the funded status compared to the prior year was due to an increase in the projected benefit obligation at December 31, 2014 relating to a decrease in the discount rate, adoption of the newly issued mortality assumptions and ~~3% respectively.~~ changes in censuses data. This increase in the projected benefit obligation was partially offset by increases in the fair value of the plan assets as of December 31, 2014.

To determine the expected long-term rate of return on the pension plans’ assets, current and expected asset allocations are considered, as well as historical and expected returns on various categories of plan assets.

The Company used the following weighted-average discount rates and expected return on plan assets to determine the net periodic pension cost:


	2013		2012		2014		2013
Discount rate	3.50 - 3.75%		4.25	%	4.50	%	3.50 - 3.75%
Expected long-term rate of return on plan assets	5.25	%	5.75	%	5.25	%	5.25	%

Holding all other assumptions constant, the following table illustrates the sensitivity of changes to the discount rate and long-term rate of return assumptions on the Company’s net periodic pension cost (amounts in millions):



	Impact on ~~2013~~2014 Expenses - increase (decrease)
50 basis point decrease in discount rate	$~~0.8~~0.9
50 basis point increase in discount rate	$(0.8)
50 basis point decrease in expected return on assets	$~~0.9~~0.8

Goodwill and Other Intangible Assets Impairment — The Company tests goodwill for impairment at the reporting unit level on an annual basis and more often if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. The Company assesses, at least quarterly, whether any triggering events have occurred.

In January of 2013, the Company announced that it would be executing restructuring activities during the first half of fiscal year 2013 related to its organizational structure and operations. As a result of these organizational structure changes, the Company combined the reporting units that previously comprised its Metals segment into a single reporting unit. The Company now has two reporting units, Metals and Plastics, which were used for the December 1, 2013 goodwill impairment testing.

Historically, the Company's policy was to perform the annual impairment test for goodwill at January 1 of each year. During the fourth quarter of 2013, the Company changed its goodwill testing date for both reporting units from January 1 to December 1. The annual impairment test was performed at January 1 and December 1 during 2013, with no identified impairment charges. The change in the goodwill impairment test date is preferable as it better aligns the impairment testing procedures with the timing of the Company's annual and long-term planning process, which is a significant element of the testing process. A second reason the Company believes that this change is preferable is that it is moving the annual testing date closer to the end of the fiscal year. This change in accounting principle did not delay, accelerate or avoid a goodwill impairment charge. This change in the annual goodwill impairment testing date was applied prospectively beginning December 1, 2013 and had no effect on the consolidated financial statements. This change was not applied retrospectively as it is impracticable to do so because retrospective application would have required the application of significant estimates and assumptions without the use of hindsight.

A two-step method is used for determining goodwill impairment. The first step is performed to identify whether a potential impairment exists by comparing each reporting unit’s fair value to its carrying value. If the carrying value of a reporting unit exceeds its fair value, the next step it to measure the amount of impairment loss, if any.

The determination of the fair value of the reporting units requires significant estimates and assumptions to be made by management. The fair value of each reporting unit is estimated using a combination of an income approach, which estimates fair value based on a discounted cash flow analysis using historical data, estimates of future cash flows and discount rates based on the view of a market participant, and a market approach, which estimates fair value using market multiples of various financial measures of comparable public companies. In selecting the appropriate assumptions the Company considers: the selection of appropriate peer group companies; control premiums appropriate for acquisitions in the industry in which the Company competes; discount rates; terminal growth rates; long-term projections of future financial performance; and relative weighting of income and market approaches. The long-term projections used in the valuation are developed as part of the Company’s annual long-term planning process. The discount rates used to determine the fair values of the reporting units are those of a hypothetical market participant which are developed based upon an analysis of comparable companies and include adjustments made to account for any individual reporting unit specific attributes such as, size and industry.

reporting unit exceeded its estimated fair value requiring the Company to perform the second step of the analysis. The second step of the analysis included allocating the calculated fair value (determined in the first step) of the Metals reporting unit to its assets and liabilities to determine an implied goodwill value. The result of the second step was that the goodwill of the Metals reporting unit was impaired and a $56.2 million non-cash impairment charge ($13.9 million of which is deductible for tax purposes) was recorded during the three-month period ended June 30, 2014 to eliminate the Metals reporting unit goodwill. No interim impairment analysis was performed for the Plastics reporting unit as of May 31, 2014 as there were no indicators of impairment for the Plastics reporting unit.

The valuation of goodwill for the second step of the goodwill impairment analysis is considered a Level 3 fair value measurement, which means that the valuation of the assets and liabilities reflect the Company’s own assumptions about the assumptions that market participants would use in pricing the assets and liabilities. The projections used in the determination of the Metals reporting unit’s fair value were based on estimates and assumptions that required significant judgment, and actual results may differ from assumed and estimated amounts. The impairment of the Metals reporting unit’s goodwill was primarily driven by the valuation effects of the continued divergence of the Metals reporting unit’s forecast versus its actual results. Specifically, in determining the fair value of the Metals reporting unit for goodwill impairment testing purposes, the Company decreased its long-term estimates of the reporting unit’s operating results and cash flows and included a Company specific risk premium of 1% into its discount rate of 13% to account for the unquantified risk that may still be present in the decreased forecast.

The Company ~~has~~ completed its December 1, ~~2013~~2014 annual goodwill impairment ~~test.~~test for its Plastics reporting unit. No annual goodwill impairment testing was performed for the Metals reporting unit as of December 1, 2014, since the Metals reporting unit goodwill was completely written off as a result of the May 31, 2014 interim goodwill impairment testing and the Metals reporting unit had no indefinite lived intangible assets. As of December 1, ~~2013,~~2014, the ~~Metals and~~ Plastics reporting ~~units~~unit had a goodwill ~~balances~~balance of approximately ~~$56~~$13.0 million ~~and $13 million, respectively,~~ and no indefinite lived intangible assets. A combination of the income approach and the market approach was utilized to estimate the reporting ~~units'~~unit's fair ~~values.~~value. The ~~Metals and~~ Plastics reporting ~~units both~~unit had an estimated fair ~~values~~value that exceeded its carrying ~~values~~value by ~~12.6% and 23.2%, respectively.~~21.0%. Under the income approach, the following key assumptions were used in the ~~Company's~~Plastics reporting unit discounted cash flow analysis:

Metals Plastics
Discount rate 12.0 % 12.0 %
5-year revenue CAGR 5.0 % 3.8 %
Terminal growth rate 2.5 % 2.0 %



Discount rate	12.0	%
5-year revenue CAGR	3.6	%
Terminal growth rate	2.0	%

Under the market approach, the Company used a multiple of earnings before interest, taxes, depreciation and amortization (“EBITDA”) of ~~6.0 and~~ 5.5 for ~~Metals and~~the Plastics ~~respectively. The EBITDA multiple observed in the marketplace for recent transactions ranged from 5.7 to 9.1 for metals companies and 8.0 to 9.2 for plastic companies as of December 31, 2013.~~reporting unit. The Company considers several factors in estimating the EBITDA multiple including a reporting unit's market position, gross and operating margins and prospects for growth, among other factors.

If ~~either~~the Plastics reporting unit's carrying value exceeded its fair value, additional valuation procedures would have been required to determine whether the reporting unit's goodwill was impaired, and to the extent goodwill was impaired, the magnitude of the impairment charge.

Although the Company believes its estimates of fair value are reasonable, actual financial results could differ from those estimates due to the inherent uncertainty involved in making such estimates. Changes in assumptions concerning future financial results or other underlying assumptions could have a significant impact on either the fair value of the Plastics reporting ~~units,~~unit, the amount of the goodwill impairment charge, or both. Future declines in the overall market value of the Company’s equity may also result in a conclusion that the fair value of ~~one or both~~the Plastics reporting ~~units~~unit has declined below its carrying value.

The majority of the Company’s recorded intangible assets were acquired as part of the Transtar and Tube Supply acquisitions in September 2006 and December 2011, respectively, and consist of customer relationships, non-compete agreements, trade names and developed technology. The initial values of the intangible assets were based on a discounted cash flow valuation using assumptions made by management as to future revenues from select customers, the level and pace of attrition in such revenues over time and assumed operating income amounts generated from such revenues. The intangible assets are amortized over their useful lives, which are 4 to 12 years for customer relationships, 3 years for non-compete agreements, 1 to 10 years for trade names and 3 years for developed technology. Useful lives are estimated by management and determined based on the timeframe over which a significant portion of the estimated future cash flows are expected to be realized from the respective intangible assets. Furthermore, when certain conditions or certain triggering events occur, a separate test offor impairment, ~~similar to~~which is included in the impairment test for long-lived assets discussed below, is performed. If the intangible asset is deemed to be impaired,

such asset will be written down to its fair value.

See Note 83 - Goodwill and Intangible Assets to the ~~consolidated financial statements~~Consolidated Financial Statements for detailed information on goodwill and intangible assets.

Long-Lived Assets — The Company’s long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset or asset group to future net cash flows (undiscounted and without interest charges) expected to be generated by the ~~asset.~~asset or asset group. If future net cash flows are less than the carrying value, the asset or asset group may be impaired. If such assets are impaired, the impairment charge is calculated as the amount by which the carrying amount of the assets exceeds the fair value of the assets. Determining whether impairment has occurred typically requires various estimates and assumptions, including determining which undiscounted cash flows are directly related to the potentially impaired asset, the useful life over which cash flows will occur, their amount, and the asset’s residual value, if any. The Company derives the required undiscounted cash flow estimates from historical experience and internal business plans. ~~Measurement~~

Due to continued net losses and lower than projected cash flows, the Company tested its long-lived assets for impairment at May 31, 2014 and December 31, 2014. The cash flows from the Company's long-lived assets exceeded their carrying values, and the Company concluded that no impairment existed at May 31, 2014 or December 31, 2014 and the remaining useful lives of ~~an impairment loss requires a determination of fair value.~~its long-lived assets were appropriate. The Company ~~uses an income approach, which estimates fair value based on estimates of future cash flows discounted at an appropriate interest rate.~~will continue to monitor its long-lived assets for impairment.

Share-Based Compensation — The Company offers share-based compensation to executives, other key employees and directors. Share-based compensation expense is recognized ratably over the vesting period or ~~shorter~~performance period, as appropriate, based on the grant date fair value of the stock award. The Company may either issue shares from treasury or new shares upon share option exercise or award issuance. Management estimates the probable number of awards which will ultimately vest when calculating the share-based compensation expense for its long-term compensation plans ("LTC Plans"). As of December 31, 2014, the Company’s weighted average forfeiture rate is approximately 49.1%. The actual number of awards that vest may differ from management’s estimate.

Stock options and non-vested shares generally vest in two to three years for executives and employees and three years for directors. Stock options have an exercise price equal to the

market price of the Company’s stock on the grant date (options granted prior to 2010) or the average closing price of the Company’s stock for the ten trading days preceding the grant date (options granted in 2010) and have a contractual life of eight to ten years. Options and restricted stock generally vest in one to five years for executives and employees and three years for directors. The Company may either issue shares from treasury or new shares upon share option exercise.

Stock options are valued using a Black-Scholes option-pricing model. Non-vested shares are valued based on the market price of the ~~Company’s~~Company's stock on the grant ~~date, using a Black-Scholes option-pricing model.~~date. The ~~expense associated with~~Company has not granted stock ~~option awards~~options since the 2010 LTC Plan

Under the 2014, 2013 and 2012 LTC Plans, the total potential award is ~~recorded on a straight-line basis over the vesting period, net~~comprised of ~~estimated forfeitures.~~

~~Share-based compensation expense for non-vested shares and~~ restricted share units ~~in the long-term compensation plans (“LTC Plans”~~("RSUs") ~~is established using the market price of the Company’s common stock~~which are time vested and performance share units ("PSUs") which are based on the ~~date of grant.~~

~~Under the 2013, 2012 and 2011 LTC Plans, the potential award for the~~Company's performance ~~shares granted is partially dependent~~compared to target goals. The PSUs awarded are based on two independent conditions, the Company’s relative total shareholder return (“RTSR”), which represents a market ~~condition. RTSR is measured against a group of peer companies either~~condition, and Company-specific target goals for Return on Invested Capital (“ROIC”) as defined in the ~~metals industry or~~LTC Plans. RSUs generally vest in ~~the industrial products distribution industry. Compensation expense for performance~~three years. RSU and ROIC PSU awards ~~containing a market condition is recognized regardless of whether~~are valued based on the market ~~condition~~price of the Company's stock on the grant date, and the value of RTSR PSU awards is ~~achieved to the extent the requisite service period condition is met.~~estimated using a Monte Carlo simulation model.

The grant date fair value of ~~performance shares containing a market-based performance condition awarded~~RTSR PSU awards under the active LTC Plans were estimated using a Monte Carlo simulation with the following assumptions:


	2013		2012		2011		2014		2013		2012
Expected volatility	59.5	%	85.0	%	62.0	%	40.8	%	59.5	%	85.0	%
Risk-free interest rate	0.38	%	0.40	%	1.10	%	0.79	%	0.38	%	0.40	%
Expected life (in years)	2.82		2.81		2.84		2.77		2.82		2.81
Expected dividend yield	—		—		—		—		—		—

~~Performance~~

PSU awards under the ~~active~~2012 LTC ~~Plans~~Plan were granted to the Company's CEO in October 2012 in connection with the commencement of his employment. The grant date fair ~~values~~value of ~~performance shares awarded~~the RTSR PSU awards granted to the CEO ~~containing the market-based performance condition~~ were estimated using a Monte Carlo simulation with the following assumptions:

2012 2011
Expected volatility 60.7 % 60.7 %
Risk-free interest rate 0.34 % 0.34 %
Expected life (in years) 2.21
1.21
Expected dividend yield —
—



	2012
Expected volatility	60.7	%
Risk-free interest rate	0.34	%
Expected life (in years)	2.21
Expected dividend yield	—

~~Under~~RTSR is measured against a group of peer companies either in the ~~2013, 2012 and 2011 LTC Plans,~~metals industry or in the ~~potential award for~~industrial products distribution industry (the "RTSR Peer Group") over a three-year performance ~~shares granted is partially dependent on the Company’s actual performance versus Company-specific target goals for Return on Invested Capital (“ROIC”)~~period as defined in the ~~2013, 2012 and 2011~~ LTC Plans. ~~Under~~The threshold, target and maximum performance levels for RTSR are the ~~2013~~25th, 50th and ~~2012 LTC Plans,~~75th percentile, respectively, relative to RTSR Peer Group performance. Compensation expense for RTSR PSU awards is recognized regardless of whether the ~~performance~~market condition is ~~determined~~achieved to the extent the requisite service period condition is met.

ROIC is measured based on the Company's average actual performance versus Company-specific goals ~~for ROIC for the three-year performance period beginning on January 1~~^stas defined in each of the ~~year of grant. Under the 2011~~ LTC ~~Plan, the performance condition is determined for any one or more fiscal years during the three-year performance period beginning on January 1~~Plans over a ^stthree~~of the year of grant. The number of performance shares, if any, that vest based on the performance achieved during the three-year performance period, will vest at the end of the three-year~~-year performance period. Compensation expense recognized is based on ~~management’s~~management's expectation of future performance compared to the pre-established performance goals. If the performance goals are not expected to be met, no compensation expense is recognized for the ROIC PSU awards and any previously recognized compensation expense is reversed.

~~Management estimates~~Final RTSR and ROIC PSU award vesting will occur at the ~~probable number~~end of ~~shares which will ultimately vest when calculating~~ the ~~share-based compensation expense for the LTC Plans. As of~~ ~~December 31, 2013~~three~~, the Company’s weighted average forfeiture rate is approximately~~ ~~38%. The actual number of shares that vest may differ from management’s estimate. Final award vesting~~-year performance period, and distribution of ~~performance~~PSU awards granted under the LTC Plans are determined based on the Company’s actual performance versus the target goals for a ~~three-year consecutive~~three-year performance period, as defined in each plan. Partial awards can be earned for performance ~~less than~~that is below the target goal, but in excess of ~~minimum~~threshold goals; and award distributions ~~above~~up to twice the target can be achieved if the target goals are exceeded.

Unless covered by a specific change-in-control or severance arrangement, participants to whom ~~restricted~~RSUs, PSUs, stock ~~units, performance shares~~options and ~~other~~ non-vested shares have been granted must be employed by the Company on the vesting date or at the end of the performance period, as appropriate, or the award will be forfeited.

Fair Value of Financial Instruments — The three-tier value hierarchy the Company utilizes, which prioritizes the inputs used in the valuation methodologies, is:

Level 1—Valuations based on quoted prices for identical assets and liabilities in active markets.

Level 2—Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.

Level 3—Valuations based on unobservable inputs reflecting our own assumptions, consistent with reasonably available assumptions made by other market participants.

The fair value of cash, accounts receivable and accounts payable approximate their carrying values. The fair value of cash equivalents are determined using the fair value hierarchy described above. Cash equivalents consisting of money market funds are valued based on quoted prices in active markets and as a result are classified as Level 1.

The Company’s pension plan asset portfolio as of December 31, ~~2013~~2014 and ~~2012~~2013 is primarily invested in fixed income securities, which generally fall within Level 2 of the fair value hierarchy. Fixed income securities are valued based on evaluated prices provided to the trustee by independent pricing services. Such prices may be determined by factors which include, but are not limited to, market quotations, yields, maturities, call features, ratings, institutional size trading in similar groups of securities and developments related to specific securities.

Fair value disclosures for the Senior Secured Notes are determined based on recent trades of the bonds and fall within Level 2 of the fair value hierarchy. The fair value of the Convertible Notes, which fall within Level 3 of the fair value hierarchy, is determined based on similar debt instruments that do not contain a conversion feature, as well as other factors related to the callable nature of the notes. The estimated fair value of the Company’s debt outstanding under its revolving credit facilities, which fall within Level 3 of the fair value hierarchy, assumes the current amount of debt outstanding at the end of the year was outstanding until the maturity of the Company’s facility in December ~~2015.~~2019.

Fair value of commodity hedges is based on information which is representative of readily observable market data. Derivative liabilities associated with commodity hedges are classified as Level 2 in the fair value hierarchy.

Recent Accounting Pronouncements

Effective January 1, 2013, the Company adopted new guidance that applies to the disclosure requirements associated with offsetting assets and liabilities and the disclosure of amounts reclassified out of accumulated other comprehensive loss by component.

See Note 1 - Basis of Presentation and Significant Accounting Policies to the ~~consolidated financial statements~~Consolidated Financial Statements for detailed information on recent accounting pronouncements.

ITEM 7a7A — Quantitative and Qualitative Disclosures about Market Risk

(Dollar amounts in millions)

The Company is exposed to interest rate, commodity price, and foreign exchange rate risks that arise in the normal course of business.

Interest Rate Risk — The Company is exposed to market risk related to its fixed rate and variable rate long-term debt. We do not utilize derivative instruments to manage exposure to interest rate changes. The market value of the Company’s $267.5 million of fixed rate long-term debt may be impacted by changes in interest rates.

The Company’s interest rates on borrowings under its ~~$100~~$125 million ~~four-year~~ revolving credit facility are subject to changes in the LIBOR and prime interest rates. There were no$59.2 million borrowings under the Company’s revolving credit agreement as of December 31, ~~2013~~.2014. A hypothetical 100 basis point increase on the Company’s variable rate debt would result in ~~$0.1~~$0.2 million of additional interest expense on an annual basis based on interest expense incurred on the revolving credit facility in ~~2013.~~2014.

Commodity Price Risk — The Company’s raw material costs are comprised primarily of engineered metals and plastics. Market risk arises from changes in the price of steel, other metals and plastics. Although average selling prices generally increase or decrease as material costs increase or decrease, the impact of a change in the purchase price of materials is more immediately reflected in the Company’s cost of materials than in its selling

prices. The ability to pass surcharges on to customers immediately can be limited due to contractual provisions with those customers. Therefore, a lag may exist between when the surcharge impacts net sales and cost of materials, respectively, which could result in a higher or lower operating profit.

The Company has a commodity hedging program to mitigate risks associated with certain commodity price fluctuations. If the commodity prices hedged were to decrease hypothetically by 100 basis points, the ~~2013~~2014 unrealized loss recorded in cost of materials would have increased by approximately $0.1 million.

Foreign Currency Risk — The Company conducts the majority of its business in the United States but also has operations in Canada, Mexico, France, the United Kingdom, Spain, China and Singapore. The Company’s results of operations historically have not been materially affected by foreign currency transaction gains and losses and, therefore, the Company has no financial instruments in place for managing the exposure to foreign currency exchange rates. The Company recognized ~~$1.9~~$4.3 million of foreign currency transaction losses during the year ended December 31, ~~2013.~~2014.

As a result of the financing arrangements entered into during December 2011, the Company has certain outstanding intercompany borrowings denominated in the U.S. dollar at its Canadian and United Kingdom subsidiaries. These intercompany borrowings are not hedged and may cause foreign currency exposure, which could be significant, in future periods if they remain unhedged.

ITEM 8 — Financial Statements and Supplementary Data

(Amounts in thousands, except par value and per share ~~data~~data)

Consolidated Statements of Operations and Comprehensive Loss
	Year Ended December 31,									Year Ended December 31,
	2013			2012			2011			2014			2013			2012
Net sales	$	1,053,066		$	1,270,368		$	1,132,366		$	979,837		$	1,053,066		$	1,270,368
Costs and expenses:
Costs, expenses and (gains):
Cost of materials (exclusive of depreciation and amortization)	779,208			927,287			845,609			746,443			779,208			927,287
Warehouse, processing and delivery expense	140,934			148,256			134,898			140,559			140,934			148,256
Sales, general and administrative expense	113,405			129,162			125,526			112,465			113,405			129,162
Restructuring charges	9,003			—			—
Restructuring activity, net										(2,960		)	9,003			—
Depreciation and amortization expense	26,188			25,867			20,472			26,044			26,188			25,867
Impairment of goodwill										56,160			—			—
Operating (loss) income	(15,672		)	39,796			5,861			(98,874		)	(15,672		)	39,796
Interest expense, net	(40,542		)	(41,090		)	(9,663		)	(40,548		)	(40,542		)	(41,090		)
Interest expense - unrealized loss on debt conversion option	—			(15,597		)	(3,991		)	—			—			(15,597		)
Loss on extinguishment of debt	(2,606		)	—			(6,153		)	—			(2,606		)	—
Other (expense) income	(1,924		)	1,349			(667		)
Other (expense) income, net										(4,323		)	(1,924		)	1,349
Loss before income taxes and equity in earnings of joint venture	(60,744		)	(15,542		)	(14,613		)	(143,745		)	(60,744		)	(15,542		)
Income taxes	19,795			(1,430		)	1,126			1,353			19,795			(1,430		)
Loss before equity in earnings of joint venture	(40,949		)	(16,972		)	(13,487		)	(142,392		)	(40,949		)	(16,972		)
Equity in earnings of joint venture	6,987			7,224			11,727			7,691			6,987			7,224
Net loss	(33,962		)	(9,748		)	(1,760		)	(134,701		)	(33,962		)	(9,748		)

Basic loss per share	$	(1.46	)	$	(0.42	)	$	(0.08	)	$	(5.77	)	$	(1.46	)	$	(0.42	)
Diluted loss per share	$	(1.46	)	$	(0.42	)	$	(0.08	)	$	(5.77	)	$	(1.46	)	$	(0.42	)
Dividends per common share	$	—		$	—		$	—		$	—		$	—		$	—

Comprehensive income (loss):
Foreign currency translation (losses) gains	$	(2,295	)	$	2,369		$	(941	)
Unrecognized pension and postretirement benefit credits (costs), net of tax benefit of $2,953, $2,312 and $1,965	4,623			(3,616		)	(3,071		)
Other comprehensive income (loss)	2,328			(1,247		)	(4,012		)
Comprehensive loss:
Foreign currency translation adjustments										$	(5,377	)	$	(2,295	)	$	2,369
Change in unrecognized pension and postretirement benefit costs, net of tax effect of $0, $2,953 and $2,312										(21,445		)	4,623			(3,616		)
Other comprehensive (loss) income										(26,822		)	2,328			(1,247		)
Net loss	(33,962		)	(9,748		)	(1,760		)	(134,701		)	(33,962		)	(9,748		)
Comprehensive loss	$	(31,634	)	$	(10,995	)	$	(5,772	)	$	(161,523	)	$	(31,634	)	$	(10,995	)

The accompanying notes to consolidated financial statements are an integral part of these statements.

Consolidated Balance Sheets
	December 31,						December 31,
	2013			2012			2014			2013
Assets
Current assets
Cash and cash equivalents	$	30,829		$	21,607		$	8,454		$	30,829
Accounts receivable, less allowances of $3,463 and $3,529	128,544			138,311
Inventories, principally on last-in first-out basis (replacement cost higher by $130,854 and $139,940)	214,900			303,772
Accounts receivable, less allowances of $3,375 and $3,463							131,003			128,544
Inventories, principally on last-in first-out basis (replacement cost higher by $129,779 and $130,854)							236,932			214,900
Prepaid expenses and other current assets	9,927			11,369			9,458			9,927
Deferred income taxes	3,242			3,723			685			3,242
Income tax receivable	3,249			7,596			2,886			3,249
Total current assets	390,691			486,378			389,418			390,691
Investment in joint venture	41,879			38,854			37,443			41,879
Goodwill	69,289			70,300			12,973			69,289
Intangible assets	69,489			82,477
Intangible assets, net							56,555			69,489
Prepaid pension cost	16,515			12,891			7,092			16,515
Other assets	15,265			18,266			11,660			15,265
Property, plant and equipment, at cost
Land	4,917			5,195			4,466			4,917
Building	53,252			52,884
Buildings							52,821			53,252
Machinery and equipment	179,632			178,664			183,923			179,632
Property, plant and equipment, at cost	237,801			236,743			241,210			237,801
Less—accumulated depreciation	(161,107		)	(157,103		)	(168,375		)	(161,107		)
Property, plant and equipment, net	76,694			79,640			72,835			76,694
Total assets	$	679,822		$	788,806		$	587,976		$	679,822
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	69,577		$	67,990		$	68,782		$	69,577
Accrued payroll and employee benefits	9,853			11,749			9,332			9,853
Accrued liabilities	20,154			24,815
Accrued and other liabilities							18,338			20,154
Income taxes payable	1,360			1,563			328			1,360
Current portion of long-term debt	397			415			737			397
Short term debt	—			500
Total current liabilities	101,341			107,032			97,517			101,341
Long-term debt, less current portion	245,599			296,154			309,377			245,599
Deferred income taxes	10,733			32,350			8,360			10,733
Other non-current liabilities	5,646			5,279			3,655			5,646
Pension and post retirement benefit obligations	6,609			10,651
Pension and postretirement benefit obligations							18,747			6,609
Commitments and contingencies
Stockholders’ equity
Preferred stock, $0.01 par value—9,988 shares authorized (including 400 Series B Junior Preferred $0.00 par value shares); no shares issued and outstanding at December 31, 2013 and December 31, 2012	—			—
Common stock, $0.01 par value—60,000 shares authorized and 23,471 shares issued and 23,409 outstanding at December 31, 2013 and 23,211 shares issued and 23,152 outstanding at December 31, 2012	234			232
Preferred stock, $0.01 par value—9,988 shares authorized (including 400 Series B Junior Preferred $0.00 par value shares); no shares issued and outstanding at December 31, 2014 and December 31, 2013							—			—
Common stock, $0.01 par value—60,000 shares authorized and 23,630 shares issued and 23,559 outstanding at December 31, 2014 and 23,471 shares issued and 23,409 outstanding at December 31, 2013							236			234
Additional paid-in capital	223,893			219,619			225,953			223,893
Retained earnings	105,277			139,239
(Accumulated deficit) retained earnings							(29,424		)	105,277
Accumulated other comprehensive loss	(18,743		)	(21,071		)	(45,565		)	(18,743		)
Treasury stock, at cost—62 shares at December 31, 2013 and 59 shares at December 31, 2012	(767		)	(679		)
Treasury stock, at cost—71 shares at December 31, 2014 and 62 shares at December 31, 2013							(880		)	(767		)
Total stockholders’ equity	309,894			337,340			150,320			309,894
Total liabilities and stockholders’ equity	$	679,822		$	788,806		$	587,976		$	679,822

The accompanying notes to consolidated financial statements are an integral part of these statements.

Consolidated Statements of Cash Flows
	Years Ended December 31,									Year Ended December 31,
	2013			2012			2011			2014			2013			2012
Operating activities:
Net loss	$	(33,962	)	$	(9,748	)	$	(1,760	)	$	(134,701	)	$	(33,962	)	$	(9,748	)
Adjustments to reconcile net loss to net cash from (used in) operating activities:
Adjustments to reconcile net loss to net cash (used in) from operating activities:
Depreciation and amortization	26,188			25,867			20,472			26,044			26,188			25,867
Amortization of deferred gain	(1,214		)	(1,619		)	(503		)	(261		)	(1,214		)	(1,619		)
Amortization of deferred financing costs and debt discount	7,914			6,232			1,662			8,064			7,914			6,232
Loss on sale of fixed assets	42			354			120
Impairment of goodwill										56,160			—			—
(Gain) loss on sale of property, plant & equipment										(5,603		)	42			354
Unrealized loss on debt conversion option	—			15,597			3,991			—			—			15,597
Unrealized losses on commodity hedges	358			163			2,331
Unrealized (gains) losses on commodity hedges										(1,256		)	358			163
Unrealized foreign currency transaction losses										3,540			—			—
Equity in earnings of joint venture	(6,987		)	(7,224		)	(11,727		)	(7,691		)	(6,987		)	(7,224		)
Dividends from joint venture	3,963			4,729			3,117			12,127			3,963			4,729
Deferred tax benefit	(24,089		)	(1,284		)	(3,333		)
Deferred tax expense (benefit)										184			(24,089		)	(1,284		)
Share-based compensation expense	3,062			2,277			4,349			1,972			3,062			2,277
Excess tax benefits from share-based payment arrangements	(420		)	(90		)	(301		)	(76		)	(420		)	(90		)
Increase (decrease) from changes in, net of acquisition:
Accounts receivable	9,279			44,570			(26,446		)	(5,785		)	9,279			44,570
Inventories	87,316			(29,340		)	(39,435		)	(26,941		)	87,316			(29,340		)
Prepaid expenses and other current assets	1,402			(2,397		)	(3,408		)	(60		)	1,402			(2,397		)
Other assets	1,470			(480		)	188			1,686			1,470			(480		)
Prepaid pension costs	3,953			(2,863		)	(2,412		)	387			3,953			(2,863		)
Accounts payable	(434		)	(42,560		)	9,910			2,630			(434		)	(42,560		)
Accrued payroll and employee benefits	(1,892		)	(2,974		)	(2,470		)	(230		)	(1,892		)	(2,974		)
Income taxes payable and receivable	4,388			454			(820		)	(772		)	4,388			454
Accrued liabilities	(2,854		)	4,514			(184		)	(3,493		)	(2,854		)	4,514
Postretirement benefit obligations and other liabilities	(3,098		)	1,173			371			(1,002		)	(3,098		)	1,173
Net cash from (used in) operating activities	74,385			5,351			(46,288		)
Net cash (used in) from operating activities										(75,077		)	74,385			5,351
Investing activities:
Acquisition/Investment of businesses, net of cash acquired	—			(6,472		)	(174,244		)	—			—			(6,472		)
Capital expenditures	(11,604		)	(11,121		)	(11,744		)	(12,351		)	(11,604		)	(11,121		)
Other investing activities, net	794			153			799
Proceeds from sale of property, plant and equipment										7,464			794			153
Net cash used in investing activities	(10,810		)	(17,440		)	(185,189		)	(4,887		)	(10,810		)	(17,440		)
Financing activities:
Short-term (repayments) borrowings, net	(496		)	(27		)	653
Net (repayments) borrowings on previously existing revolving lines of credit	—			—			(26,403		)
Proceeds from long-term debt, including new revolving credit facility	115,300			767,090			320,476
Repayments of long-term debt, including new revolving credit facility	(170,345		)	(762,887		)	(53,212		)
Short-term debt repayments, net										—			(496		)	(27		)
Proceeds from long-term debt										462,404			115,300			767,090
Repayments of long-term debt										(403,811		)	(170,345		)	(762,887		)
Payment of debt issue costs	—			(1,503		)	(16,633		)	(627		)	—			(1,503		)
Exercise of stock options	1,216			146			356			158			1,216			146
Excess tax benefits from share-based payment arrangements	420			90			301			76			420			90
Net cash (used in) from financing activities	(53,905		)	2,909			225,538
Net cash from (used in) financing activities										58,200			(53,905		)	2,909
Effect of exchange rate changes on cash and cash equivalents	(448		)	263			(253		)	(611		)	(448		)	263
Net increase (decrease) in cash and cash equivalents	9,222			(8,917		)	(6,192		)
Net change in cash and cash equivalents										(22,375		)	9,222			(8,917		)
Cash and cash equivalents—beginning of year	21,607			30,524			36,716			30,829			21,607			30,524
Cash and cash equivalents—end of year	$	30,829		$	21,607		$	30,524		$	8,454		$	30,829		$	21,607

See Note 1 to the ~~consolidated financial statements~~Consolidated Financial Statements for supplemental cash flow disclosures.

The accompanying notes to consolidated financial statements are an integral part of these statements.

Consolidated Statements of Stockholders' Equity
	Common Shares	Treasury Shares		Preferred Stock		Common Stock		Treasury Stock			Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Income			Total			Common Shares	Treasury Shares		Preferred Stock		Common Stock		Treasury Stock			Additional Paid-in Capital			(Accumulated Deficit) Retained Earnings			Accumulated Other Comprehensive (Loss) Income			Total
Balance at January 1, 2011	23,149	(163	)	$	—	$	231	$	(2,226	)	$	180,519		$	150,747		$	(15,812	)	$	313,459
Balance at January 1, 2012																							23,159	(149	)	$	—	$	232	$	(1,712	)	$	184,596		$	148,987		$	(19,824	)	$	312,279
Net loss														(1,760		)				(1,760		)														(9,748		)				(9,748		)
Foreign currency translation																	(941		)	(941		)																	2,369			2,369
Defined benefit pension liability adjustments, net of tax benefit of $1,965																	(3,071		)	(3,071		)
Long-term incentive plan											3,260									3,260
Exercise of stock options and other	10	14				1		514			817									1,332
Balance at December 31, 2011	23,159	(149	)	$	—	$	232	$	(1,712	)	$	184,596		$	148,987		$	(19,824	)	$	312,279
Net loss														(9,748		)				(9,748		)
Foreign currency translation																	2,369			2,369
Defined benefit pension liability adjustments, net of tax benefit of $2,312																	(3,616		)	(3,616		)
Embedded conversion option, net of tax benefit of $8,285											33,752									33,752
Change in unrecognized pension and postretirement benefit costs, net of tax effect of $2,312																																							(3,616		)	(3,616		)
Embedded conversion option, net of tax effect of $8,285																																	33,752									33,752
Long-term incentive plan											1,592									1,592													1,592									1,592
Exercise of stock options and other	52	90						1,033			(321		)							712			52	90						1,033			(321		)							712
Balance at December 31, 2012	23,211	(59	)	$	—	$	232	$	(679	)	$	219,619		$	139,239		$	(21,071	)	$	337,340		23,211	(59	)	$	—	$	232	$	(679	)	$	219,619		$	139,239		$	(21,071	)	$	337,340
Net loss														(33,962		)				(33,962		)														(33,962		)				(33,962		)
Foreign currency translation																	(2,295		)	(2,295		)																	(2,295		)	(2,295		)
Defined benefit pension liability adjustments, net of tax benefit of $2,953																	4,623			4,623
Change in unrecognized pension and postretirement benefit costs, net of tax effect of $2,953																																							4,623			4,623
Long-term incentive plan											2,877									2,877													2,877									2,877
Exercise of stock options and other	260	(3	)			2		(88		)	1,397									1,311			260	(3	)			2		(88		)	1,397									1,311
Balance at December 31, 2013	23,471	(62	)	$	—	$	234	$	(767	)	$	223,893		$	105,277		$	(18,743	)	$	309,894		23,471	(62	)	$	—	$	234	$	(767	)	$	223,893		$	105,277		$	(18,743	)	$	309,894
Net loss																																				(134,701		)				(134,701		)
Foreign currency translation																																							(5,377		)	(5,377		)
Change in unrecognized pension and postretirement benefit costs, $0 tax effect																																							(21,445		)	(21,445		)
Long-term incentive plan																																	1,456									1,456
Exercise of stock options and other																							159	(9	)			2		(113		)	604									493
Balance at December 31, 2014																							23,630	(71	)	$	—	$	236	$	(880	)	$	225,953		$	(29,424	)	$	(45,565	)	$	150,320

The accompanying notes to consolidated financial statements are an integral part of these statements.

A. M. Castle & Co.

Notes to Consolidated Financial Statements

(Amounts in thousands except par value and per share ~~data and percentages~~data)

(1) Basis of Presentation and Significant Accounting Policies

Nature of operations — A.M. Castle & Co. and its subsidiaries (the “Company”) is a specialty metals and plastics distribution company serving principally the North American market. The Company has operations in the United States, Canada, Mexico, France, the United Kingdom, Spain, China and Singapore. The Company provides a broad range of product inventories as well as value-added processing and supply chain services to a wide array of customers, principally within the producer durable equipment, oil and gas, aerospace, heavy industrial equipment, industrial goods, construction equipment, retail, marine and automotive sectors of the global economy. Particular focus is placed on the aerospace and defense, oil and gas, power generation, mining, heavy industrial equipment, marine, office furniture and fixtures, safety products, life science applications, automotive and general manufacturing industries as well as general engineering applications.

The Company’s corporate headquarters ~~are~~is located in Oak Brook, Illinois. The Company has 4647 operational service centers located throughout North America (42), Europe (3) and Asia ~~(1)~~(2).

The Company purchases metals and plastics from many producers. Purchases are made in large lots and held in distribution centers until sold, usually in smaller quantities and often with value-added processing services performed. Orders are primarily filled with materials shipped from Company stock. The materials required to fill the balance of sales are obtained from other sources, such as direct mill shipments to customers or purchases from other distributors. Thousands of customers from a wide array of industries are serviced primarily through the Company’s own sales organization.

Basis of presentation — The consolidated financial statements include the accounts of A. M. Castle & Co. and its subsidiaries over which the Company exhibits a controlling interest. The equity method of accounting is used for the Company’s 50% owned joint venture, Kreher Steel Company, LLC (“Kreher”). All inter-company accounts and transactions have been eliminated.

~~Reclassification~~ ~~— For comparability, certain~~ ~~2012~~ ~~and~~ ~~2011~~ ~~amounts have been reclassified to conform to presentation adopted in~~ ~~2013. To conform with current presentation, the Company has reclassified~~ ~~2012~~ ~~and~~ ~~2011~~ amounts related to foreign currency transaction gains (losses) to other income (expense). Such amounts were previously recorded in sales, general and administrative expense in the consolidated statements of operations and other comprehensive loss. Accounting principles generally accepted in the United States of America ("U.S. GAAP") provides several alternatives for presenting foreign currency transaction gains (losses). The Company believes its new presentation will be most useful to investors as it is consistent with the way the Company views its operating performance internally and will also allow for better comparability of the Company's operating performance with certain companies within its industry.

~~Refer below for the impact on the presentation in the consolidated statements of operations and comprehensive loss:~~

Year ended December 31,
2012 2011
As Previously Reported After Reclassification As Previously Reported After Reclassification
Sales, general and administrative expense $ 127,813
$ 129,162
$ 126,193
$ 125,526
Other income (expense) —
1,349
—
(667 )

Use of estimates — The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. The principal areas of estimation reflected in the consolidated financial statements are accounts receivable allowances, inventory reserves, goodwill and intangible assets, income taxes, pension and other post-employment benefits and share-based compensation and convertible debt feature mark-to-market adjustments.

Revenue recognition — Revenue from the sale of products is recognized when the earnings process is complete and when the title and risk and rewards of ownership have passed to the customer, which is primarily at the time of shipment.

Revenue recognized other than at the time of shipment represented less than 3%2% of the Company’s consolidated net sales for the years ended December 31, 2014, 2013 ~~2012~~ and ~~2011.~~2012. Provisions for allowances related to sales discounts and rebates are recorded based on terms of the sale in the period that the sale is recorded. Management utilizes historical information and the current sales trends of the business to estimate such provisions. The provisions related to discounts and rebates due to customers are recorded as a reduction within net sales in the Company’s consolidated statements of operations and comprehensive loss.

Revenue from shipping and handling charges is recorded in net sales. Costs incurred in connection with shipping and handling the Company’s products, which are related to third-party carriers or performed by Company personnel, are included in warehouse, processing and delivery expenses. For the years ended December 31, 2014, 2013 ~~2012~~ and ~~2011,~~2012, shipping and handling costs included in warehouse, processing and delivery expenses were $35,471, $35,171 ~~$36,585~~ and ~~$35,214,~~$36,585, respectively.

The Company maintains an allowance for doubtful accounts related to the potential inability of customers to make required payments. The allowance for doubtful accounts is maintained at a level considered appropriate based on historical experience and specific identification of customer receivable balances for which collection is unlikely. The provision for doubtful accounts is recorded in sales, general and administrative expense in the Company’s consolidated statements of operations and comprehensive loss. Estimates of doubtful accounts are based on historical write-off experience as a percentage of net sales and judgments about the probable effects of economic conditions on certain customers.

Accounts receivable allowance activity is presented in the table below:


	2013			2012			2011			2014			2013			2012
Balance, beginning of year	$	3,529		$	3,584		$	3,848		$	3,463		$	3,529		$	3,584
Add Provision charged to expense	484			1,420			523			465			484			1,420
Recoveries	173			90			140			139			173			90
Other	—			—			157
Less Charges against allowance	(723		)	(1,565		)	(1,084		)	(692		)	(723		)	(1,565		)
Balance, end of year	$	3,463		$	3,529		$	3,584		$	3,375		$	3,463		$	3,529

Cost of materials — Cost of materials consists of the costs the Company pays for metals, plastics and related inbound freight charges. It excludes depreciation and amortization which are discussed below. The Company accounts for the majority of its inventory on a last-in, first-out (“LIFO”) basis. LIFO adjustments are recorded in cost of materials.

Operating expenses — Operating costs and expenses primarily consist of:

Warehouse, processing and delivery expenses, including occupancy costs, compensation and employee benefits for warehouse personnel, processing, shipping and handling costs;

Sales expenses, including compensation and employee benefits for sales personnel;

General and administrative expenses, including compensation for executive officers and general management, expenses for professional services primarily attributable to accounting and legal advisory services, bad debt expenses, data communication costs, computer hardware and maintenance expenses and occupancy costs for non-warehouse locations;

Restructuring ~~charges,~~activity, including a gain on the sale of fixed assets and moving costs related to facility consolidations, employee termination and related benefits associated with salaried and hourly workforce reductions, lease termination costs ~~moving costs~~ and other exit ~~costs associated with plant consolidations;~~costs;

Impairment of goodwill; and

Depreciation and amortization expenses, including depreciation for all owned property and equipment, and amortization of various intangible assets.

Cash equivalents — Cash equivalents are highly liquid, short-term investments that have an original maturity of 90 days or less.

Statement of cash flows — Non-cash investing and financing activities and supplemental disclosures of consolidated cash flow information are as follows:


	Year ended December 31,						Year ended December 31,
	2013		2012		2011		2014		2013		2012
Non-cash investing and financing activities:
Capital expenditures financed by accounts payable	$	1,219	$	479	$	1,123	$	434	$	1,219	$	479
Capital lease obligations	21		1,009		—		873		21		1,009
Deferred debt origination fees	—		—		886
Additional purchase price paid in 2012 for Tube Supply acquisition	—		—		6,472
Cash paid during the year for:
Interest	33,266		34,051		7,234		32,278		33,266		34,051
Income taxes	2,417		5,557		9,555		1,800		2,417		5,557
Cash received during the year for:
Income tax refunds	3,015		3,184		6,724		2,284		3,015		3,184

Inventories — Inventories consist primarily of finished goods. Approximately 68% and 80% of the Company’s inventories are valued at the lower of LIFO cost or market at December 31, 2014 and 2013, ~~and 2012.~~respectively. Final inventory determination under the LIFO costing method is made at the end of each fiscal year based on the actual inventory levels and costs at that time. The Company values its LIFO increments using the cost of its latest purchases during the years reported. Current replacement cost of inventories exceeded book value by $~~130,854~~129,779 and $~~139,940~~130,854 at

December 31, ~~2013~~2014 and ~~2012,~~2013, respectively. Income taxes would become payable on any realization of this excess from reductions in the level of inventories.

During 2013, a reduction in inventories resulted in a liquidation of applicable LIFO inventory quantities carried at higher costs in prior years. Cost of materials for 2013 where higher by $1,834 as a result of this liquidation.

The Company maintains an allowance for excess and obsolete inventory. The excess and obsolete inventory allowance is determined ~~based on~~through the specific identification of material, adjusted for expected scrap value to be ~~received.~~

~~Insurance plans —~~ The Company is a member of a group captive insurance company (the “Captive”) domiciled in Grand Cayman Island. The Captive reinsures losses related to certain of the Company’s workers’ compensation, automobile and general liability risks that occur subsequent to August 2009. Premiums arereceived, based on ~~the Company’s loss experience~~previous sales experience.

Excess and are accrued as expenses for the period to which the premium relates. Premiums are credited to the Company’s “loss fund” and earn investment income until claims are actually paid. For claims that were incurred prior to August 2009, the Companyobsolete inventory allowance activity is ~~self-insured. Self-insurance amounts are capped, for individual claims and~~presented in the aggregate, for each policy year by an insurance company. Self-insurance reserves are based on unpaid, known claims (including related administrative fees assessed by the insurance company for claims processing) and a reserve for incurred but not reported claims based on the Company’s historical claims experience and development.table below:

~~The Company is self-insured for medical insurance for its domestic operations. Self-insurance reserves are maintained based on incurred but not paid claims based on a historical lag.~~



	2014			2013			2012
Balance, beginning of year	$	7,329		$	7,835		$	7,000
Add Provision charged to expense	9,979			2,259			1,153
Less Charges against allowance	(2,127		)	(2,765		)	(318		)
Balance, end of year	$	15,181		$	7,329		$	7,835

Property, plant and equipment — Property, plant and equipment are stated at cost and include assets held under capital leases. Expenditures for major additions and improvements are capitalized, while maintenance and repair costs that do not substantially improve or extend the useful lives of the respective assets are expensed in the period in which they are incurred. When items are disposed, the related costs and accumulated depreciation are removed from the accounts and any gain or loss is reflected in income.

The Company provides for depreciation of plant and equipment sufficient to amortize the cost over their estimated useful lives as follows:



Buildings and building improvements	3 – 40 years
Plant equipment	3 – 25 years
Furniture and fixtures	2 – 10 years
Vehicles and office equipment	3 – 10 years

Leasehold improvements are depreciated over the shorter of their useful lives or the remaining term of the lease. Depreciation is calculated using the straight-line method and depreciation expense for 2014, 2013 and 2012 was $14,414, $14,397 and ~~2011 was $14,397,~~ $14,024, ~~and $13,605,~~ respectively.

Long-lived assets — The Company’s long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset or asset group to future net cash flows (undiscounted and without interest charges) expected to be generated by the asset or asset group. If future net cash flows are less than the carrying value, the asset or asset group may be impaired. If such assets are impaired, the impairment charge is calculated as the amount by which the carrying amount of the assets exceeds the fair value of the assets. Determining whether impairment has occurred typically requires various estimates and assumptions, including determining which undiscounted cash flows are directly related to the potentially impaired asset, the useful life over which cash flows will occur, their amount, and the asset’s residual value, if any. The Company derives the required undiscounted cash flow estimates from historical experience and internal business plans.

Goodwill and intangible assets — The Company tests goodwill for impairment at the reporting unit level on an annual basis at December 1 of each year and more often if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. The Company assesses, at least quarterly, whether any triggering events have occurred.

Historically, the Company's policy was to perform the annual impairment test for goodwill at January 1 of each year. During the fourth quarter of fiscal year 2013, the Company changed its goodwill testing date for both reporting units from January 1 to December 1. During fiscal year 2013, the annual impairment test was performed at January 1, 2013 and December 1, 2013, with no identified impairment charges. The change in the goodwill impairment test date better aligns the impairment testing procedures with the timing of the Company's annual and long-term planning process, which is a significant element of the testing process. A second reason the Company believes that this change is preferable is that it is moving the annual testing date closer to the end of the fiscal year. This change in accounting principle did not delay, accelerate or avoid a goodwill impairment charge. This change in the annual goodwill impairment testing date was applied prospectively beginning December 1, 2013 and had no effect on the consolidated financial statements. This change was not applied retrospectively as it is impracticable to do so because retrospective application would have required the application of significant estimates and assumptions without the use of hindsight.

A two-step method is used for determining goodwill impairment. The first step is performed to identify whether a potential impairment exists by comparing each reporting unit’s fair value to its carrying value. If the carrying value of a reporting unit exceeds its fair value, the next step is to measure the amount of impairment loss, if any.

discount rates based on the view of a market participant, and a market approach, which estimates fair value using market multiples of various financial measures of comparable public companies. In selecting the appropriate assumptions the Company considers: the selection of appropriate peer group companies; control premiums appropriate for acquisitions in the industry in which the Company competes; discount rates; terminal growth rates; long-term projections of future financial performance; and relative weighting of income and market approaches. The long-term projections used in the valuation are developed as part of the Company’s annual long-term planning process. The discount rates used to determine the fair values of the reporting units are those of a hypothetical market participant which are developed based upon an analysis of comparable companies and include adjustments made to account for any individual reporting unit specific attributes such as, size and industry.

The majority of the Company’s recorded intangible assets were acquired as part of the Transtar and Tube Supply, Inc. (“Tube Supply”) acquisitions in September 2006 and December 2011, respectively, and consist of customer relationships, non-compete agreements, trade names and developed technology. The initial values of the intangible assets were based on a discounted cash flow valuation using assumptions made by management as to future revenues from select customers, the level and pace of attrition in such revenues over time and assumed operating income amounts generated from such revenues. These intangible assets are amortized over their useful lives, which are 4 to 12 years for customer relationships, 3 years for non-compete agreements, 1 to 10 years for trade names, and 3 years for developed technology. Useful lives are estimated by management and determined based on the timeframe over which a significant portion of the estimated future cash flows are expected to be realized from the respective intangible assets. Furthermore, when certain conditions or certain triggering events occur, a separate test offor impairment, ~~similar to~~which is included in the impairment test for long-lived assets discussed above, is performed. If the intangible asset is deemed to be impaired, such asset will be written down to its fair value.

Income taxes — The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statement and the tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

The Company records valuation allowances against its deferred tax assets when it is more likely than not that the amounts will not be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies and recent results of operations. In the event the Company determines it would not be able to realize its deferred tax assets, a valuation allowance is recorded, which increases the provision for income taxes in the period in which that determination is made. ~~As of December 31, 2013, the Company concluded that it was more likely than not that it would realize its deferred tax assets and no valuation allowance was deemed necessary.~~

The Company has undistributed earnings of foreign subsidiaries of approximately ~~$83,086~~$48,585 at December 31, ~~2013,~~2014, for which deferred taxes have not been provided. Such earnings are considered indefinitely invested in the foreign subsidiaries. If such earnings were repatriated, additional tax expense may result, although due to the potential availability of foreign tax credits and other items, the calculation of such potential taxes is not practicable.

The Company's 50% ownership interest in Kreher (see Note 6) is through a 50% interest in a limited liability company (LLC) taxed as a partnership. Kreher has two subsidiaries organized as individually taxed C-Corporations. The Company includes in its income tax provision the income tax liability on its share of Kreher income. The income tax liability of Kreher itself is generally treated as a current income tax expense and the income tax liability associated with the profits of the two subsidiaries of Kreher is treated as a deferred income tax expense. The Company ~~can not~~cannot independently cause a dividend to be declared by one of Kreher's subsidiaries, therefore no benefit of a dividend received deduction can be recognized in the Company's tax provision until a dividend is declared. If one of Kreher's C-Corporation subsidiaries declares a dividend payable to Kreher, the Company recognizes a benefit for the 80% dividends received deduction on its 50% share of the dividend.

The Company recognizes interest and penalties related to unrecognized tax benefits within income tax expense. Accrued interest and penalties are included within other long-term liabilities in the consolidated balance sheets.

Insurance plans — The Company is a member of a group captive insurance company (the “Captive”) domiciled in Grand Cayman Island. The Captive reinsures losses related to certain of the Company’s workers’ compensation, automobile and general liability risks that occur subsequent to August 2009. Premiums are based on the Company’s loss experience and are accrued as expenses for the period to which the premium relates. Premiums are credited to the Company’s “loss fund” and earn investment income until claims are actually paid. For claims that were incurred prior to August 2009, the Company is self-insured. Self-insurance amounts are capped, for individual claims and in the aggregate, for each policy year by an insurance company. Self-insurance reserves are based on unpaid, known claims (including related administrative fees assessed by the insurance company for claims processing) and a reserve for incurred but not reported claims based on the Company’s historical claims experience and development.

The Company is self-insured for medical insurance for its domestic operations. Self-insurance reserves are maintained based on incurred but not paid claims based on a historical lag.

Foreign currency — For the majority of the Company’s non-U.S. operations, the functional currency is the local currency. Assets and liabilities of those operations are translated into U.S. dollars using year-end exchange rates, and income and expenses are translated using the average exchange rates for the reporting period. The currency effects of translating financial statements of the Company’s non-U.S. operations which operate in local currency environments are recorded in accumulated other comprehensive (loss) income, ~~(loss),~~ a separate component of stockholders’ equity. Transaction gains or losses resulting from foreign currency transactions were not material for any of the years presented.

Earnings per share — Diluted earnings per share is computed by dividing net income by the weighted average number of shares of common stock plus common stock equivalents. Common stock equivalents consist of employee and director stock options, restricted stock awards, other share-based payment awards, and contingently issuable shares related to the Company’s convertible debt which are included in the calculation of weighted average shares outstanding using the treasury stock method, if dilutive.

The following table is a reconciliation of the basic and diluted earnings per share calculations:


	Year ended December 31,									Year ended December 31,
	2013			2012			2011			2014			2013			2012
Numerator:
Net loss	$	(33,962	)	$	(9,748	)	$	(1,760	)	$	(134,701	)	$	(33,962	)	$	(9,748	)
Denominator:
Denominator for basic loss per share:
Weighted average common shares outstanding	23,214			22,993			22,983			23,359			23,214			22,993
Effect of dilutive securities:
Outstanding common stock equivalents	—			—			—			—			—			—
Denominator for diluted loss per share	23,214			22,993			22,983			23,359			23,214			22,993
Basic loss per share	$	(1.46	)	$	(0.42	)	$	(0.08	)	$	(5.77	)	$	(1.46	)	$	(0.42	)
Diluted loss per share	$	(1.46	)	$	(0.42	)	$	(0.08	)	$	(5.77	)	$	(1.46	)	$	(0.42	)
Excluded outstanding share-based awards having an anti-dilutive effect	717			994			757			388			717			994
Excluded "in the money" portion of Convertible Notes having an anti-dilutive effect	2,032			1,416			1,734			365			2,032			1,416

The Convertible Notes are dilutive to the extent the Company generates net income and the average stock price during the annual period is greater than $10.28, the conversion price of the Convertible Notes. The Convertible Notes are only dilutive for the “in the money” portion of the Convertible Notes that could be settled with the Company’s stock. In future periods, absent a fundamental change, (as defined in the Convertible Notes agreement), the outstanding Convertible Notes could increase diluted average shares outstanding by a maximum of approximately 5,600 shares.

Payment of cash dividends are currently limited due to restrictions contained in the Company’s debt agreements. No cash dividends were paid on the Company’s common stock in 2014 or 2013. The Company may consider paying cash

dividends on the Company common stock at some point in the future, subject to the limitations described above. Any future payment of cash dividends, if any, is at the discretion of the Board of Directors and will depend on the Company’s earnings, capital requirements and financial condition, restrictions under the Company’s debt instruments, and such other factors as the Board of Directors may consider.

Concentrations — The Company serves a wide range of customers within the producer durable equipment, oil and gas, aerospace, heavy industrial equipment, industrial goods, construction equipment, retail, marine and automotive sectors of the economy. Its customer base includes many Fortune 500 companies as well as thousands of medium and smaller sized firms spread across the entire spectrum of metals and plastics using industries. The Company’s customer base is well diversified and, therefore, the Company does not have dependence upon any single customer or a few customers. No single customer represented more than 3% of the Company’s ~~2013~~2014 total net sales. Approximately ~~78%~~75% of the Company’s net sales isare from locations in the United States.

Share-based compensation — The Company offers share-based compensation to executives, other key employees and directors. Share-based compensation expense is recognized ratably over the vesting period or ~~shorter~~performance period, as appropriate, based on the grant date fair value of the stock award. ~~Options and restricted stock generally vest in one to five years for executives and employees and three years for directors.~~ The Company may either issue shares from treasury or new shares upon share option exercise or award issuance. Management estimates the probable number of awards which will ultimately vest when calculating the share-based compensation expense for its long-term compensation plans ("LTC Plans"). As of December 31, ~~2013~~2014, the Company’s weighted average forfeiture rate is approximately ~~38%~~49%. The actual number of awards that vest may differ from management’s estimate.

Stock options and non-vested shares generally vest in two to three years for executives and employees and three years for directors. Stock options have an exercise price equal to the market price of the Company’s stock on the grant date (options granted prior to 2010) or the average closing price of the Company’s stock for the 10 trading days preceding the grant date (options granted in 2010) and have a contractual life of eight to ten years. Stock options are valued using a Black-Scholes option-pricing model. Non-vested shares are valued based on the market price of the ~~Company’s~~Company's stock on the grant ~~date, using a Black-Scholes option-pricing model.~~date. The Company has not granted stock options since the 2010 LTC Plan.

Under the 2014, 2013 and 2012 LTC Plans, the total potential award is comprised of restricted share units ("RSUs") ~~(time vested)~~which are time vested and performance share units ~~(PSUs).~~("PSUs") which are based on the Company's performance compared to target goals. The PSUs awarded are based on two independent conditions, the Company’s relative total shareholder return (“RTSR”), which represents a market condition, and Company-specific target goals for Return on Invested Capital (“ROIC”) as defined in the LTC Plans. RSUs generally vest in three years. RSU and ROIC PSU awards are valued based on the market price of the Company's stock on the grant date, and the value of RTSR PSU awards is estimated using a Monte Carlo simulation model.

RTSR is measured against a group of peer companies either in the metals industry or in the industrial products distribution industry (the "RTSR Peer Group") over a three-year performance period as defined in the LTC Plans. The threshold, target and maximum performance levels for RTSR are the 25th, 50th and 75th percentile, respectively, relative to RTSR Peer Group performance. Compensation expense for ~~PSUs containing a market condition~~RTSR PSU awards is

recognized regardless of whether the market condition is achieved to the extent the requisite service period condition is met.

ROIC is measured based on the Company's average actual performance versus Company-specific goals as defined in each of the LTC ~~Plans.~~Plans over a three-year performance period. Compensation expense recognized is based on management's expectation of future performance compared to the pre-established performance goals. If the performance goals are not expected to be met, no compensation expense is recognized for the ROIC PSU awards and any previously recognized compensation expense is reversed.

Final RTSR and ROIC PSU award vesting will occur at the end of the three-year performance period, and distribution of ~~performance~~PSU awards granted under the LTC Plans are determined based on the Company’s actual performance versus the target goals for a three-year ~~consecutive~~performance period, as defined in each plan. Partial awards can be earned for performance ~~less than~~that is below the target goal, but in excess of ~~minimum~~threshold goals; and award distributions up to twice the target can be achieved if the target goals are exceeded.

Unless covered by a specific change-in-control or severance arrangement, participants to whom RSUs, PSUs, stock options and ~~other~~ non-vested shares have been granted must be employed by the Company on the vesting date or at the end of the performance period, ~~respectively,~~as appropriate, or the award will be forfeited.

New Accounting Standards Updates

Standards ~~Updates~~Update Adopted

Effective January 1, ~~2013,~~2014, the Company adopted Accounting Standards Update ("ASU") No. 2013-01, “Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities.” The amendments in this ASU clarify that the scope of ASU 2011-11 applies to derivatives accounted for in accordance with Topic 815, Derivatives and Hedging, including bifurcated embedded derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions that are either offset in accordance with Section 210-20-45 or Section 815-10-45 or subject to an enforceable master netting arrangement or similar agreement. The amendments in this ASU require an entity to disclose information to enable users of its financial statements to evaluate the effect or potential effect of netting arrangements on its financial position for recognized assets and liabilities, including the effect or potential effect of rights of set off associated with an entity’s recognized assets and recognized liabilities within the scope of Topic 210. The adoption of this ASU did not have an impact on the Company's financial condition, liquidity or operating results. The disclosure requirements associated with the adoption of ASU 2011-11 are reflected in Note 10.

Effective January 1, 2013, the Company adopted the guidance in ASU No. 2013-02, “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income,” related to the presentation of reclassification adjustments out of accumulated other comprehensive income. The amendments in this ASU require the Company to provide information about the amounts reclassified out of accumulated other comprehensive income by component. The Company is also required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income, but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income, the Company is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. The adoption of this ASU did not have an impact on the Company's financial condition, liquidity or operating results. The disclosure requirements associated with the adoption of ASU 2013-02 are reflected in Note 12.

~~Standards Updates Issued Not Yet Effective~~

~~During July 2013, the FASB issued ASU~~ No. 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” The amendments in this ASU require an entity to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward except when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available or when the deferred tax asset is not intended for this purpose. ~~This~~The adoption of this ASU did not have a material impact on the Company's financial condition or financial statement presentation.

Standards Updates Issued Not Yet Effective

In August 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-15, "Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern," providing additional guidance surrounding the disclosure of going concern uncertainties in the financial statements and implementing requirements for management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued. The ASU is effective for annual reporting periods, and interim periods within those years, beginning after December 15, 2016. The Company does not anticipate the adoption of the ASU will result in additional disclosures, however, management will begin performing the periodic assessments required by the ASU on its effective date.

In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers," related to revenue recognition. The underlying principle of the new standard is that a business or other organization will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects what it expects in exchange for the goods or services. The standard also requires more detailed disclosures and provides additional guidance for transactions that were not addressed completely in prior accounting guidance. The ASU provides alternative methods of initial adoption, and it is effective for annual reporting periods beginning after December 15, ~~2013,~~2016, and interim periods within those annual periods. Early adoption is not permitted. The Company is currently reviewing the guidance and assessing the potential impact on its results.

In April 2014, the FASB issued ASU 2014-08, "Presentation of Financial Statements and Property, Plant and Equipment: Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity." The ASU amends the definition of a discontinued operation, expands disclosure requirements for transactions that meet the definition of a discontinued operation and requires entities to disclose additional information about individually significant components that are disposed of or held for sale and do not qualify as discontinued operations. The ASU is effective prospectively for all disposals (except disposals classified as held for sale before the adoption date) or components initially classified as held for sale in periods beginning on or after December 15, 2014. Early adoption is permitted. The Company anticipates that the adoption of this ASU will not have an impact on the Company's financial condition ~~liquidity~~ or operating results. The adoption of this ASU may impact the Company’s financial statement presentation ~~in future~~and disclosures for interim and annual financial statements ~~issued.~~issued in the future.

(2) Joint Venture

Kreher Steel Company, LLC is a 50% owned joint venture of the Company. Kreher is a national distributor and processor of carbon and alloy steel bar products, headquartered in Melrose Park, Illinois.

The following information summarizes the Company’s participation in the joint venture as of and for the year ended December 31:



	2014		2013		2012
Equity in earnings of joint venture	$	7,691	$	6,987	$	7,224
Investment in joint venture	37,443		41,879		38,854
Sales to joint venture	188		198		455
Purchases from joint venture	224		86		695

The following information summarizes financial data for this joint venture as of and for the year ended December 31:



	2014		2013		2012
Revenues	$	259,487	$	230,351	$	257,776
Net income	15,555		13,720		14,603
Current assets	93,679		82,827		94,241
Non-current assets	26,377		25,615		26,099
Current liabilities	11,896		10,548		14,315
Non-current liabilities	35,469		16,103		27,845
Members’ equity	72,691		81,791		76,360
Capital expenditures	3,042		1,836		5,220
Depreciation and amortization	2,294		2,217		2,034

(3) Goodwill and Intangible Assets

The changes in carrying amounts of goodwill during the years ended December 31, 2014 and 2013 were as follows:



	2014								2013
	Metals Segment			Plastics Segment		Total			Metals Segment			Plastics Segment		Total
Balance as of January 1
Goodwill	$	116,533		$	12,973	$	129,506		$	117,544		$	12,973	$	130,517
Accumulated impairment losses	(60,217		)	—		(60,217		)	(60,217		)	—		(60,217		)
Balance as of January 1	56,316			12,973		69,289			57,327			12,973		70,300
Impairment charge	(56,160		)	—		(56,160		)	—			—		—
Currency valuation	(156		)	—		(156		)	(1,011		)	—		(1,011		)
Balance as of December 31
Goodwill	116,377			12,973		129,350			116,533			12,973		129,506
Accumulated impairment losses	(116,377		)	—		(116,377		)	(60,217		)	—		(60,217		)
	$	—		$	12,973	$	12,973		$	56,316		$	12,973	$	69,289

The Company tests goodwill for impairment at the reporting unit level on an annual basis as of December 1 and more often if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. The Company assesses, at least quarterly, whether any triggering events have occurred. A two-step method is used for determining goodwill impairment. The first step is performed to identify whether a potential impairment exists by comparing each reporting unit’s fair value to its carrying value. If the carrying value of a reporting unit exceeds its fair value, the next step is to measure the amount of impairment loss, if any.

During the second quarter of 2014, the Company concluded that under FASB Accounting Standards Codification (“ASC”) 350, "Intangibles - Goodwill and Other," its unfavorable operating results could be indicators of impairment of its Metals reporting unit's goodwill and, therefore, performed an interim impairment analysis as of May 31, 2014 using the two-step quantitative analysis. Under the first step, the Company determined that the carrying value of the Metals reporting unit exceeded its estimated fair value requiring the Company to perform the second step of the analysis. The second step of the analysis included allocating the calculated fair value (determined in the first step) of the Metals reporting unit to its assets and liabilities to determine an implied goodwill value. The result of the second step was that the goodwill of the Metals reporting unit was impaired and a $56,160 non-cash impairment charge ($13,900 of which is deductible for tax purposes) was recorded during the three-month period ended June 30, 2014 to eliminate the Metals reporting unit goodwill. No interim impairment analysis was performed for the Plastics reporting unit as of May 31, 2014 as there were no indicators of impairment for the Plastics reporting unit.

significant judgment, and actual results may differ from assumed and estimated amounts. The impairment of the Metals reporting unit’s goodwill was primarily driven by the valuation effects of the continued divergence of the Metals reporting unit’s forecast versus its actual results. Specifically, in determining the fair value of the Metals reporting unit for goodwill impairment testing purposes, the Company decreased its long-term estimates of the reporting unit’s operating results and cash flows and included a Company specific risk premium of 1% into its discount rate of 13% to account for the unquantified risk that may still be present in the decreased forecast.

The Company completed its December 1, 2014 annual goodwill impairment test for its Plastics reporting unit and there were no identified impairment charges. No annual goodwill impairment testing was performed for the Metals reporting unit as of December 1, 2014, since the Metals reporting unit goodwill was eliminated as a result of the May 31, 2014 interim goodwill impairment testing.

The following summarizes the components of the Company's intangible assets at December 31, 2014 and 2013:



	2014				2013
	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Customer relationships	$	116,268	$	64,922	$	117,794	$	55,157
Non-compete agreements	3,888		3,888		3,888		3,569
Trade names	7,864		2,655		8,025		1,939
Developed technology	1,400		1,400		1,400		953
Total	$	129,420	$	72,865	$	131,107	$	61,618

The weighted-average amortization period for the intangible assets is 10.8 years, 11.3 years for customer relationships, 9.6 years for trade names, 3 years for non-compete agreements and 3 years for developed technology. Substantially all of the Company’s intangible assets were acquired as part of the acquisitions of Transtar on September 5, 2006 and Tube Supply on December 15, 2011.

Due to continued net losses and lower than projected cash flows, the Company tested its long-lived assets for impairment at May 31, 2014 and December 31, 2014. The undiscounted cash flows from the Company's long-lived assets exceeded their carrying values, and the Company concluded that no impairment existed at May 31, 2014 or December 31, 2014 and the remaining useful lives of its long-lived assets were appropriate. The Company will continue to monitor its long-lived assets for impairment.

For the years ended December 31, 2014, 2013, and 2012, the aggregate amortization expense was $11,630, $11,791 and $11,843, respectively.

The following is a summary of the estimated annual amortization expense for each of the next 5 years:



2015	$	10,789
2016	10,789
2017	8,766
2018	4,650
2019	4,650

~~(2) Acquisition~~(4) Debt

On Short-term and long-term debt consisted of the following at December ~~15,~~31, 2014 and 2013:



	2014			2013
LONG-TERM DEBT
12.75% Senior Secured Notes due December 15, 2016	210,000			210,000
7.0% Convertible Notes due December 15, 2017	57,500			57,500
Revolving Credit Facility due December 10, 2019	59,200			—
Other, primarily capital leases	1,257			998
Total long-term debt	327,957			268,498
Less: unamortized discount	(17,843		)	(22,502		)
Less: current portion	(737		)	(397		)
Total long-term portion	309,377			245,599
TOTAL DEBT	$	310,114		$	245,996

During December of 2011 the Company ~~acquired~~issued ~~100~~$225,000 ~~percent~~aggregate principal amount of 12.75% Senior Secured Notes due 2016 (the “Secured Notes”), $57,500 aggregate principal amount of 7.0% Convertible Senior Notes due 2017 (the “Convertible Notes”) and entered into a $100,000 senior secured asset based revolving credit facility (the “Revolving Credit Facility”). The Company incurred debt origination fees of $18,136 associated with the debt transactions which are primarily being amortized using the effective interest method.

Secured Notes

The Company filed a registration statement with the Securities and Exchange Commission on Form S-4 on April 11, 2012. The registration statement was declared effective on June 12, 2012.

On June 12, 2012, the Company commenced an offer to exchange $225,000 principal amount of 12.75% Senior Secured Notes due 2016, which are registered under the Securities Act of 1933 (the “New Secured Notes”), for $225,000 principal amount of outstanding 12.75% Senior Secured Notes due 2016, which had not been registered under the Securities Act of 1933 (the “Old Secured Notes”). The terms of the ~~outstanding common shares of Tube Supply (the “Acquisition”). The Acquisition was accounted for using the acquisition method. Accordingly, the purchase price has been allocated~~New Secured Notes issued are identical in all material respects to the ~~assets acquired~~Old Secured Notes, except that the New Secured Notes are registered under the Securities Act of 1933, do not have any of the transfer restrictions, registration rights and ~~liabilities assumed based on estimated fair values at date of acquisition. The nonrecurring fair value measurements are classified as Level 3 in the fair value hierarchy (see~~ ~~Note 10~~ ~~for the definition of Level 3 inputs).~~

~~The results and the assets of Tube Supply are included in the Company’s Metals segment.~~

Tube Supply, based in Houston, Texas, is a leading value-added distributor of specialty tubular and bar products for the oil and gas industry. Tube Supply provides high quality products and services primarilyadditional interest provisions relating to the ~~North American oilfield equipment manufacturing industry. Tube Supply operates~~ ~~two~~ ~~service centers, which are located in Houston, Texas~~Old Secured Notes and ~~Edmonton, Alberta.~~bear a different CUSIP number from the Old Secured Notes. The ~~Acquisition has allowed~~Company did not receive any proceeds from the ~~Company to capitalize on the demand and opportunities in the oil and gas sector through new product offerings to an expanded customer base.~~exchange offer.

The ~~aggregate purchase price was~~New Secured Notes will mature on ~~$184,385~~December 15, 2016. The Company will pay interest on the New Secured Notes at a rate of 12.75% ~~and represents the aggregate~~per annum in cash ~~purchase price, including a working capital adjustment.~~semi-annually. The ~~premium~~Company paid ~~in excess~~interest of ~~the fair value of the net assets acquired was primarily for the ability to expand the Company’s oil and gas product offerings, as well as to obtain Tube Supply’s skilled, established workforce.~~$26,775

~~During 2011, the Company incurred~~, $~~4,260~~ ~~of direct acquisition-related costs, which are recorded in Sales, general~~28,548 and ~~administrative expense.~~

~~An allocation of~~$28,688 on the ~~purchase price to~~New Secured Notes during the ~~fair value of the assets acquired and liabilities assumed, which was finalized in December 2012, is as follows:~~

~~Purchase Price Allocation~~

Current assets $ 134,817
Property, plant and equipment, net 6,767
Other assets 346
Trade name 7,700
Customer relationships 48,800
Non-compete agreements 1,000
Developed technology 1,400
Goodwill 19,637
Total assets acquired 220,467
Current liabilities 33,211
Long-term liabilities 2,871
Total liabilities assumed 36,082
Total purchase price $ 184,385

~~The acquired intangible assets have a weighted average useful life of approximately~~ ~~11.4~~ ~~years. Useful lives by intangible asset category are as follows: trade name -~~ 10years ~~customer relationships -~~ 12 ~~years, non-compete agreements -~~ 3 ~~years and developed technology -~~ 3 ~~years.~~

~~At closing, the Company entered into a lease agreement with the former owners of Tube Supply. At~~ended December 31, ~~2013 and 2012, an unfavorable lease liability associated with the lease for a newly constructed distribution center used by Tube Supply of $1,465~~2014and $2,168, respectively, is recorded in other non-current liabilities. The current portion of the unfavorable lease liability in the amount of $703 and $645 is included in accrued liabilities in the consolidated balance sheets at December 31, , 2013 and 2012, respectively. The ~~unfavorable lease liability resulted from the present value~~New Secured Notes are fully and unconditionally guaranteed, jointly and severally, by certain 100% owned domestic subsidiaries of the ~~difference between the estimated fair market value and the executed contract price the~~ Company ~~will pay to lease the property.~~(the “Note Guarantors”). The ~~unfavorable lease liability will be amortized over the remaining life of the lease.~~

~~The goodwill and intangible assets are deductible for tax purposes.~~

The results of operations of Tube Supply have been included in the Company's consolidated statements of operations and comprehensive loss since December 15, 2011. The net sales and net income for Tube Supply during the period from December 15, 2011 through December 31, 2011 were ~~$7,648~~ ~~and~~ ~~$901, respectively.~~

~~The following unaudited pro forma summary presents the effect of the Acquisition during the year ended December 31, 2011 as though the business had been acquired as of January 1, 2011:~~

Year ended December 31, 2011
(Unaudited)
Pro forma net sales $ 1,332,176
Pro forma net income 7,033
Pro forma basic net income per share $ 0.31
Pro forma diluted net income per share 0.28

Unaudited pro forma supplemental information is based upon management estimates and judgments. The unaudited pro forma supplemental information also includes purchase accounting and interest expense adjustmentsNew Secured Notes and the related ~~tax effects.~~guarantees are secured by a lien on substantially all of the Company's and the Note Guarantors' assets, subject to certain exceptions and permitted liens pursuant to a pledge and security agreement. The ~~unaudited pro forma supplemental information~~terms of the New Secured Notes contain numerous covenants imposing financial and operating restrictions on the Company's business. These covenants place restrictions on the Company's ability and the ability of its subsidiaries to, among other things, pay dividends, redeem stock or make other distributions or restricted payments; incur indebtedness or issue common stock; make certain investments; create liens; agree to payment restrictions affecting certain subsidiaries; consolidate or merge; sell or otherwise transfer or dispose of assets, including equity interests of certain subsidiaries; enter into transactions with affiliates, enter into sale and leaseback transactions; and use the proceeds of permitted sales of the Company's assets. Refer to Note 14 - Guarantor Financial Information.

On or after December 15, 2014, the Company may redeem some or all of the New Secured Notes at a redemption premium of 106.375% of the principal amount for the ~~year ended~~12-month period beginning December ~~31, 2011 excludes direct acquisition-related costs~~15, 2014 and 100% thereafter, plus accrued and unpaid interest.

The New Secured Notes also contain a provision that allows holders of the New Secured Notes to require the Company to repurchase all or any part of the Secured Notes if a change of control triggering event occurs. Under this provision, the repurchase of the New Secured Notes will occur at a purchase price of ~~$4,260~~101% ~~and includes loss on extinguishment of debt of $6,153 and interest costs of~~ ~~$7,366~~ associated with the underwriting fee for debt financing and the mark-to-market adjustment for the conversion option on the convertible bonds. These pro forma results are not necessarily indicative of what would have occurred if the acquisition had been in effect for the period presented or of future results. Pro forma financial information is not provided for the years ended December 31, 2013 and 2012 as a full year of post-acquisition results of operations for Tube Supply were included in the Company's consolidated statements of operations and comprehensive loss.

~~See~~ ~~Note 9~~ ~~for detailed discussion on the Company’s debt financing structure used to finance the Acquisition.~~

~~(3) Segment Reporting~~

The Company distributes and performs processing on both metals and plastics. Although the distribution processes are similar, the customer markets, supplier bases and types of products are different. Additionally, the Company’s Chief Executive Officer, the chief operating decision-maker, reviews and manages these ~~two~~ ~~businesses separately. As such, these businesses are considered reportable segments and are reported accordingly. Neither~~ of the ~~Company’s reportable segments has any unusual working capital requirements.~~outstanding principal amount,

In its Metals segment, the Company’s marketing strategy focuses on distributing highly engineered specialty grades and alloys of metals as well as providing specialized processing services designed to meet very precise specifications. Core products include alloy, aluminum, stainless, nickel, titanium and carbon. Inventories of these products assume many forms such as plate, sheet, extrusions, round bar, hexagon bar, square and flat bar, tubing and coil. Depending on the size of the facility and the nature of the markets it serves, service centers are equipped as needed with bar saws, plate saws, oxygen and plasma arc flame cutting machinery, trepanning machinery, boring machinery, honing equipment, water-jet cutting, stress relieving and annealing furnaces, surface grinding equipment and sheet shearing equipment. This segment also performs various specialized fabrications for its customers through pre-qualified subcontractors that thermally process, turn, polish and straighten alloy and carbon bar.

The Company’s Plastics segment consists exclusively of a wholly-owned subsidiary that operates as Total Plastics, Inc. (“TPI”), headquartered in Kalamazoo, Michigan, and its wholly-owned subsidiaries. The Plastics segment stocks and distributes a wide variety of plastics in forms that include plate, rod, tube, clear sheet, tape, gaskets and fittings. Processing activities within this segment include cut-to-length, cut-to-shape, bending and forming according to customer specifications. The Plastics segment’s diverse customer base consists of companies in the retail (point-of-purchase), automotive, marine, office furniture and fixtures, safety products, life sciences applications, and general manufacturing industries. TPI has locations throughout the upper northeast and midwest regions of the U.S. and one facility in Florida from which it services a wide variety of users of industrial plastics.

~~The accounting policies of all segments are the same as described in~~ ~~Note 1. Management evaluates the performance of its business segments based on operating income.~~

~~on the location of the Company’s subsidiary that is selling direct to the customer. Company-wide geographic data as of and for the years ended December 31, 2013, 2012 and 2011 are as follows:~~

2013 2012 2011
Net sales
United States $ 817,714
$ 988,161
$ 895,165
All other countries 235,352
282,207
237,201
Total $ 1,053,066
$ 1,270,368
$ 1,132,366
Long-lived assets
United States $ 63,667
$ 68,253
72,138
All other countries 13,027
11,387
10,003
Total $ 76,694
$ 79,640
82,141

~~Segment information as of and for the years ended December 31, 2013, 2012 and 2011 is as follows:~~

Net
Sales

Operating
(Loss)
Income

Total
Assets

Capital
Expenditures

Depreciation &
Amortization
2013
Metals segment^(a)
$ 918,298
$ (11,571 ) $ 580,570
$ 10,181
$ 24,579
Plastics segment 134,768
4,278
57,373
1,423
1,609
Other ^(b)
—
(8,379 ) 41,879
—
—
Consolidated $ 1,053,066
$ (15,672 ) $ 679,822
$ 11,604
$ 26,188
2012
Metals segment ^(a)
$ 1,143,884
$ 48,473
$ 693,803
$ 9,819
$ 24,480
Plastics segment 126,484
3,188
56,149
1,831
1,387
Other ^(b)
—
(11,865 ) 38,854
—
—
Consolidated $ 1,270,368
$ 39,796
$ 788,806
$ 11,650
$ 25,867
2011
Metals segment ^(a)
$ 1,014,130
$ 14,191
$ 729,692
$ 10,639
$ 19,329
Plastics segment 118,236
2,860
56,171
2,228
1,143
Other^(b)
—
(11,190 ) 36,460
—
—
Consolidated $ 1,132,366
$ 5,861
$ 822,323
$ 12,867
$ 20,472

^(a) ~~The results of Tube Supply, acquired on December 15, 2011, are included in the Company's Metals segment.~~

^(b) “Other” – Operating loss includes the costs of executive, legal and finance departments, which are shared by both the Metals and Plastics segments. The “Other” category’s total assets consist of the Company’s investment in joint venture.

~~Below are reconciliations of segment data to the consolidated loss before income taxes:~~

2013 2012 2011
Operating (loss) income $ (15,672 ) $ 39,796
$ 5,861
Interest expense, net (40,542 ) (41,090 ) (9,663 )
Interest expense - unrealized loss on debt conversion option —
(15,597 ) (3,991 )
Loss on extinguishment of debt (2,606 ) —
(6,153 )
Other (expense) income (1,924 ) 1,349
(667 )
Loss before income taxes and equity in earnings of joint venture (60,744 ) (15,542 ) (14,613 )
Equity in earnings of joint venture 6,987
7,224
11,727
Consolidated loss before income taxes $ (53,757 ) $ (8,318 ) $ (2,886 )

plus accrued and unpaid interest, if any, on such New Secured Notes to the date of repurchase. In addition, upon certain asset sales, the Company may be required to offer to use the net proceeds thereof to purchase some of the New Secured Notes at 100% of the principal amount thereof, plus accrued and unpaid interest.

Subject to certain conditions, within 95 days after the end of each fiscal year, the Company must make an offer to purchase New Secured Notes with certain of its excess cash flow (as defined in the indenture) for such fiscal year, commencing with the fiscal year ending December 31, 2012, at 103% of the principal amount thereof, plus accrued and unpaid interest. For the fiscal year ended December 31, 2014, the Company estimated that it had no excess cash flow (as defined in the indenture) and therefore, an offer to purchase New Secured Notes will not be made. The Company had no excess cash flow (as defined in the indenture) for the fiscal year ended December 31, 2013. For the fiscal year ended December 31, 2012, the Company estimated excess cash flow to be approximately $17,000 and therefore, an offer to purchase New Secured Notes was made on April 1, 2013. This offer expired on April 30, 2013 with no Secured Notes tendered.

In November 2013, the Company purchased $15,000 aggregate principal amount of its Senior Secured Notes in the open market with available cash. The Senior Secured Notes that were purchased by the Company were subsequently retired. The purchase of the Senior Secured Notes resulted in a pre-tax loss on debt extinguishment of $2,606 consisting of tender premiums, write off of unamortized debt issuance costs and tender expenses.

Convertible Notes

The $50,000 Convertible Notes were issued pursuant to an indenture, dated as of December 15, 2011, among the Company, the Note Guarantors and U.S. Bank National Association, as trustee. The Convertible Notes were issued by the Company at an initial offering price equal to 100% of the principal amount. The Company granted the initial purchaser in the Convertible Notes offering an option, exercisable within 30 days, to purchase up to an additional $7,500 aggregate principal amount of Convertible Notes. The initial purchaser exercised their option in full and, on December 20, 2011, the Company issued an additional $7,500 aggregate principal amount of Convertible Notes.

The Convertible Notes will mature on December 15, 2017. The Company will pay interest on the Convertible Notes at a rate of 7.0% in cash semi-annually. The Company paid interest of $4,025, $4,025 and $4,025 on the Convertible Notes during the years ended December 31, 2014, 2013 and 2012, respectively. The Convertible Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by the Note Guarantors. The initial conversion rate for the Convertible Notes is 97.2384 shares of the Company’s common stock per $1 principal amount of Convertible Notes, equivalent to an initial conversion price of approximately $10.28 per share of common stock. The conversion rate will be subject to adjustment, but will not be adjusted for accrued and unpaid interest, if any. In addition, if an event constituting a fundamental change occurs, the Company will in some cases increase the conversion rate for a holder that elects to convert its Convertible Notes in connection with such fundamental change. Upon conversion, the Company will pay and/or deliver, as the case may be, cash, shares of common stock or a combination of cash and shares of common stock, at the Company’s election, together with cash in lieu of fractional shares.

Holders may convert their Convertible Notes at their option on any day prior to the close of business on the scheduled trading day immediately preceding June 15, 2017 only under the following circumstances: (1) during the five business-day period after any five consecutive trading-day period (the “measurement period”) in which the trading price per note for each day of that measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the applicable conversion rate on each such day; (2) during any calendar quarter (and only during such calendar quarter) after the calendar quarter ended December 31, 2011, if the last reported sale price of the Company’s common stock for 20 or more trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is equal to or greater than 130% of the applicable conversion price in effect for each applicable trading day; (3) upon the occurrence of specified corporate events, including certain dividends and distributions; or (4) if the Company calls the Convertible Notes for redemption on or after December 20, 2015. The Convertible Notes will be convertible, regardless of the foregoing circumstances, at any time from, and including, June 15, 2017 through the second scheduled trading day immediately preceding the maturity date.

Prior to April 26, 2012, the Company had the option to elect not to issue shares of common stock upon conversion of the Convertible Notes to the extent such election would result in the issuance of more than 19.99% of the common stock outstanding immediately before the issuance of the Convertible Notes until the Company receives shareholder approval for such issuance and shareholder approval of the increase in the number of shares of common stock authorized and available for issuance upon conversion of the Convertible Notes. Since the Company did not have sufficient authorized shares available to share-settle the conversion option in full, the embedded conversion option did not qualify for equity classification and instead was separately valued and accounted for as a derivative liability as

of December 31, 2011. The initial value allocated to the derivative liability was $22,330 of the $57,500 principal amount of the Convertible Notes, which represents a discount to the debt to be amortized through interest expense using the effective interest method through the maturity of the Convertible Notes. Accordingly, the effective interest rate used to amortize the debt discount on the Convertible Notes was determined to be 17.78%. During each reporting period prior to April 26, 2012, the derivative liability was marked to fair value through earnings.

On April 26, 2012, at the Company's Annual Meeting of Stockholders, shareholder approval was obtained for the issuance of shares in excess of 19.99% of the Company's outstanding common stock to satisfy any conversions of the Convertible Notes. Additionally, shareholder approval was obtained to amend the Company's charter to authorize additional shares of common stock from 30,000 to 60,000. With these approvals, the Company now has the ability to share-settle the conversion option in full and therefore, the embedded conversion option is no longer required to be separately valued and accounted for as a derivative liability. As of April 26, 2012, the conversion option's cumulative value of $42,037 was reclassified to additional paid-in capital and will no longer be marked-to-market through earnings. The deferred tax benefit of $8,285 associated with the temporary difference between the financial reporting basis of the derivative liability and its tax basis at the date of issuance (December 15, 2011) was also reclassified to additional paid-in capital.

Upon a fundamental change and subject to certain exceptions, as defined in the Convertible Notes indenture, holders may require the Company to repurchase some or all of their Convertible Notes for cash at a repurchase price equal to 100% of the principal amount of the Convertible Notes being repurchased, plus any accrued and unpaid interest.

The Company may not redeem the Convertible Notes prior to December 20, 2015. On or after December 20, 2015, the Company may redeem all or part of the Convertible Notes (except for the Convertible Notes that the Company is required to repurchase as described above) if the last reported sale price of the Company’s common stock exceeds 135% of the applicable conversion price for 20 or more trading days in a period of 30 consecutive trading days ending on the trading day immediately prior to the date of the redemption notice. The redemption price will equal the sum of 100% of the principal amount of the Convertible Notes to be redeemed, plus accrued and unpaid interest, plus a “make-whole premium” payment. The Company must make the "make-whole" premium payments on all Convertible Notes called for redemption including Convertible Notes converted after the date we delivered the notice of redemption. The Company will pay the redemption price in cash except for any non-cash portion of the "make-whole" premium.

Revolving Credit Facility

The Revolving Credit Facility consists of a $125,000 senior secured asset-based revolving credit facility (subject to adjustment pursuant to a borrowing base described below), of which (a) up to an aggregate principal amount of $20,000 will be available for a Canadian subfacility, (b) up to an aggregate principal amount of $20,000 will be available for letters of credit and (c) up to an aggregate principal amount of $10,000 will be available for swingline loans. Loans under the Revolving Credit Facility will be made available to the Company and certain domestic subsidiaries (the “U.S. Borrowers”) in U.S. dollars and the Canadian Borrowers in U.S. dollars and Canadian dollars. In December 2014, the Company obtained an extension on its revolving credit facility, which extended the maturity date from December 15, 2015 to December 10, 2019 (or 91 days prior to the maturity date of the Company's Senior Secured Notes or Convertible Notes if they have not been refinanced).

All obligations of the U.S. Borrowers under the Revolving Credit Facility are guaranteed on a senior secured basis by each direct and indirect, existing and future, domestic subsidiary of the U.S. Borrowers (the “U.S. Subsidiary Guarantors” and together with the U.S. Borrowers, the “U.S. Credit Parties”), subject to certain exceptions for immaterial subsidiaries. All obligations of the Canadian Borrowers under the Revolving Credit Facility are guaranteed on a senior secured basis by (a) each U.S. Credit Party and (b) each direct and indirect, existing and future, Canadian subsidiary of the Company (the “Canadian Subsidiary Guarantors” and together with the Canadian Borrowers, the “Canadian Credit Parties”; and the U.S. Credit Parties together with the Canadian Credit Parties, the “Credit Parties”), subject to certain exceptions.

All obligations under the Revolving Credit Facility are secured on a first-priority basis by a perfected security interest in substantially all assets of the Credit Parties (subject to certain exceptions for permitted liens). The Revolving Credit Facility will rank pari passu in right of payment with the Secured Notes, but, pursuant to the intercreditor agreement, the Secured Notes will be effectively subordinated to the indebtedness under the Revolving Credit Facility with respect to the collateral.

At the Company’s election, borrowings under the Revolving Credit Facility will bear interest at variable rates based on (a) a customary base rate plus an applicable margin of between 0.50% and 1.00% (depending on quarterly average undrawn availability under the Revolving Credit Facility) or (b) an adjusted LIBOR rate plus an applicable margin of between 1.50% and 2.00% (depending on quarterly average undrawn availability under the Revolving Credit Facility). The weighted average interest rate on borrowings outstanding under the revolving credit facilities were 3.08%, 2.71% and 2.71% for the years ended December 31, 2014, 2013 and 2012, respectively. The Company will pay certain customary recurring fees with respect to the Revolving Credit Facility.

The Revolving Credit Facility permits the Company to increase the aggregate amount of the commitments under the Revolving Credit Facility from time to time in an aggregate amount for all such increases not to exceed $50,000, subject to certain conditions. The existing lenders under the Revolving Credit Facility are not obligated to provide the incremental commitments. In January 2014, the Company partially exercised the accordion option under its revolving credit facility to increase the aggregate commitments by $25,000. As a result, the Company's borrowing capacity increased from $100,000 to $125,000. The Company maintains the option to exercise the accordion for an additional $25,000 of aggregate commitments in the future, assuming it meets certain thresholds for incurring additional debt.

The Revolving Credit facility contains a springing financial maintenance covenant requiring the Company to maintain the ratio of EBITDA (as defined in the agreement) to fixed charges of 1.1 to 1.0 when excess availability is less than the greater of 10% of the calculated borrowing base (as defined in the agreement) or $12,500. In addition, if excess availability is less than the greater of 12.5% of the calculated borrowing base (as defined in the agreement) or $15,625, the lender has the right to take full dominion of the Company’s cash collections and apply these proceeds to outstanding loans under the Revolving Credit Agreement. The Company's ratio of EBITDA to fixed charges was negative for the twelve months ended December 31, 2014. At this negative ratio, the Company's current maximum borrowing capacity would be $100,397 before triggering full dominion of the Company's cash collections. As of December 31, 2014, the Company had $41,197 of additional unrestricted borrowing capacity available under the Revolving Credit Facility.

Net interest expense reported on the consolidated statements of operations was reduced by interest income from investment of excess cash balances of $81 in 2014, $35 in 2013 and $222 in 2012.

(5) Fair Value Measurements

The three-tier value hierarchy the Company utilizes, which prioritizes the inputs used in the valuation methodologies, is:

Level 1—Valuations based on quoted prices for identical assets and liabilities in active markets.

Level 3—Valuations based on unobservable inputs reflecting our own assumptions, consistent with reasonably available assumptions made by other market participants.

The Company’s pension plan asset portfolio as of December 31, 2014 and 2013 is primarily invested in fixed income securities, which generally fall within Level 2 of the fair value hierarchy. Fixed income securities in the pension plan asset portfolio are valued based on evaluated prices provided to the trustee by independent pricing services. Such prices may be determined by factors which include, but are not limited to, market quotations, yields, maturities, call features, ratings, institutional size trading in similar groups of securities and developments related to specific securities. Refer to Note 5 for pension fair value disclosures.

Fair Value Measurements of Debt

The fair value of the Company’s Senior Secured Notes as of December 31, 2014 was estimated to be $216,808 compared to a carrying value of $210,000. The fair value for the Senior Secured Notes is determined based on recent trades of the bonds and fall within Level 2 of the fair value hierarchy.

The fair value of the Convertible Notes, as of December 31, 2014 was estimated to be approximately $61,932 compared to a carrying value of $57,500. The fair value for the Convertible Notes, which fall within Level 3 of the fair value

hierarchy, is determined based on similar debt instruments that do not contain a conversion feature, as well as other factors related to the callable nature of the notes.

The main inputs and assumptions into the fair value model for the Convertible Notes at December 31, 2014 were as follows:



Company's stock price at the end of the period	$	7.98
Expected volatility	38.3		%
Credit spreads	9.28		%
Risk-free interest rate	1.08		%

As of December 31, 2014, the estimated fair value of the Company's debt outstanding under its revolving credit facility, which falls within Level 3 of the fair value hierarchy, was $51,253 compared to its carrying value of $59,200. The fair value was calculated based on the present value of the outstanding debt using the revolving credit facility interest rate as of December 31, 2014 plus a premium and assuming the current amount of debt outstanding as of December 31, 2014 was outstanding until the maturity of the Company's facility in December 2019. Although borrowings could be materially greater or less than the current amount of borrowings outstanding at the end of the period, it is not practical to estimate the amounts that may be outstanding during the future periods since there is no predetermined borrowing or repayment schedule.

Fair Value Measurements of Commodity Hedges

The Company has a commodity hedging program to mitigate risks associated with certain commodity price fluctuations. At December 31, 2014, the Company had executed forward contracts that extend through 2016. The counterparty to these contracts is not considered a credit risk by the Company. At December 31, 2014 and 2013, the notional value associated with forward contracts was $7,486 and $12,492, respectively. The Company recorded, through cost of materials, realized and unrealized net losses of $288, $2,141 and $430 during the years ended December 31, 2014, 2013 and 2012, respectively, as a result of the decline in the fair value of the contracts. As of December 31, 2014 and 2013, all commodity hedge contracts were in a liability position. Refer to Note 12 - Commitments and Contingent Liabilities for letters of credit outstanding for collateral associated with commodity hedges.

The Company uses information which is representative of readily observable market data when valuing derivative liabilities associated with commodity hedges. The derivative liabilities are classified as Level 2 in the table below.

The liabilities measured at fair value on a recurring basis were as follows:



	Level 1		Level 2		Level 3		Total ^(a)
As of December 31, 2014
Derivative liability for commodity hedges	$	—	$	1,615	$	—	$	1,615
As of December 31, 2013
Derivative liability for commodity hedges	$	—	$	2,871	$	—	$	2,871

^(a)As of December 31, 2014, the short-term portion of the derivative liability for commodity hedges of $1,137 is included in "Accrued and other liabilities" and the long-term portion of $478 is included in "Other non-current liabilities" in the Consolidated Balance Sheet. As of December 31, 2013, the short-term portion of the derivative liability for commodity hedges of $1,516 is included in "Accrued and other liabilities" and the long-term portion of $1,355 is included in "Other non-current liabilities" in the Consolidated Balance Sheet.

(6) Lease Agreements

The Company has operating and capital leases covering certain warehouse and office facilities, equipment, automobiles and trucks, with the lapse of time as the basis for all rental payments.

Future minimum rental payments under operating and capital leases that have initial or remaining non-cancelable lease terms in excess of one year as of December 31, ~~2013~~2014, are as follows:


	Capital		Operating		Capital		Operating
2014	$	400	$	13,462
2015	395		11,734		$	738	$	14,091
2016	203		10,719		470		12,879
2017	—		9,191		49		10,909
2018	—		8,051		—		9,399
2019					—		7,702
Later years	—		19,895		—		23,400
Total future minimum rental payments	$	998	$	73,052	$	1,257	$	78,380

Total rental payments charged to expense were $14,173 in 2014, $15,062 in 2013, and $15,579 in 2012~~, and~~ ~~$12,362~~ in ~~2011~~. Lease extrication charges of $186 and $1,448 associated with restructuring activities in the Metals segment were included in total rental payments charged to expense in 2014 and 2013, respectively, within "Restructuring ~~Charges"~~activity" in the Consolidated Statement of Operations. There were no lease extrication charges in 2012 ~~and~~ ~~2011~~. Total gross value of property, plant and equipment under capital leases was $~~1,660~~2,452 and $~~1,895~~1,660 in2014 and 2013, respectively.

(7) Stockholders' Equity

Shareholder Rights Plan

In August 2012, the Company's Board of Directors adopted a Shareholder Rights Plan (the “Rights Plan”) and declared a dividend of one right for each outstanding share of the Company's common stock outstanding at the close of business on September 11, 2012. Pursuant to the Rights Plan, the Company issued one preferred stock purchase right (a “Right”) for each share of common stock outstanding on September 11, 2012. Each Right, once exercisable, represents the right to purchase one one-hundredth of a share (a “Unit”) of Series B Junior Preferred Stock of the Company, without par value, for $54.00, subject to adjustment. The Rights become exercisable in the event any individual person or entity, without Board approval, acquires 10% or more of the Company's common stock, subject to certain exceptions. In these circumstances, each holder of a Right (other than rights held by the acquirer) will be entitled to purchase, at the then-current exercise price of the Right, additional shares of the Company's common stock having a value of twice the exercise price of the Right. Additionally, if the Company is involved in a merger or other business combination transaction with another person after which its common stock does not remain outstanding, each Right will entitle its holder to purchase, at the then-current exercise price of the Right, shares of common stock of the ultimate parent of such other person having a market value of twice the exercise price of the Right. The Rights may be redeemed by the Company for $0.001 per Right at any time until the tenth business day following the first public announcement of an acquisition of beneficial ownership of 10% of the Company's common stock. On August 13, 2013, the Company's Board of Directors agreed to extend the Rights Plan from August 30, 2013, when it was originally set to expire, to August 30, 2014, unless the rights issued thereunder are earlier redeemed or the Rights Plan is amended by the Board of Directors. The Rights Plan expired on August 30, 2014.

Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss as reported in the consolidated balance sheets as of December 31, 2014 and 2013 was comprised of the following:



	2014			2013
Foreign currency translation losses	$	(9,994	)	$	(4,617	)
Unrecognized pension and postretirement benefit costs, net of tax	(35,571		)	(14,126		)
Total accumulated other comprehensive loss	$	(45,565	)	$	(18,743	)

Changes in accumulated other comprehensive loss by component for the years ended December 31, 2014 and 2013 are as follows:



	Defined Benefit Pension and Postretirement Items						Foreign Currency Items						Total
	2014			2013			2014			2013			2014			2013
Balance as of January 1,	$	(14,126	)	$	(18,749	)	$	(4,617	)	$	(2,322	)	$	(18,743	)	$	(21,071	)
Other comprehensive (loss) income before reclassifications	(23,108		)	3,256			(5,377		)	(2,295		)	(28,485		)	961
Amounts reclassified from accumulated other comprehensive loss, net of tax ^(a)	1,663			1,367			—			—			1,663			1,367
Net current period other comprehensive (loss) income	(21,445		)	4,623			(5,377		)	(2,295		)	(26,822		)	2,328
Balance as of December 31,	$	(35,571	)	$	(14,126	)	$	(9,994	)	$	(4,617	)	$	(45,565	)	$	(18,743	)

^(a)See reclassifications from accumulated other comprehensive loss table for details of reclassification from accumulated other comprehensive loss for the year ended December 31, 2014.

Reclassifications from accumulated other comprehensive loss for the years ended December 31, 2014 and 2013 are as follows:



	Year ended December 31,
	2014			2013
Unrecognized pension and postretirement benefit items:
Prior service cost^(b)	$	(282	)	$	(322	)
Actuarial loss ^(b)	(1,381		)	(1,919		)
Total before Tax	(1,663		)	(2,241		)
Tax effect	—			874
Total reclassifications for the period, net of tax	$	(1,663	)	$	(1,367	)

^(b)These accumulated other comprehensive loss components are included in the computation of net periodic pension and postretirement benefit cost included in "Sales, general and administrative expense" in the Consolidated Statements of Operations for the years ended December 31, 2014 and 2013 (see Note 9 - Employee Benefit Plans for additional details).

(8) Share-based Compensation

The consolidated compensation cost recorded for the Company’s share-based compensation arrangements was $1,972, $3,062 and $2,277 for 2014, 2013 and 2012, respectively. The total income tax benefit recognized in the consolidated statements of operations for share-based compensation arrangements was $189, $1,141 and $872 in 2014, 2013 and 2012, respectively. All compensation expense related to share-based compensation arrangements is recorded in sales, general and administrative expense. The unrecognized compensation cost as of December 31, 2014 associated with all share-based payment arrangements is $3,450 and the weighted average period over which it is to be expensed is 1.4 years.

Restricted Stock, Stock Option and Equity Compensation Plans – The Company maintains certain long-term stock incentive and stock option plans for the benefit of officers, directors and other key management employees. A summary of the authorized shares under these plans is detailed below:



Plan Description	Authorized Shares
1995 Directors Stock Option Plan	188
1996 Restricted Stock and Stock Option Plan	938
2000 Restricted Stock and Stock Option Plan	1,200
2004 Restricted Stock, Stock Option and Equity Compensation Plan	1,350
2008 A. M. Castle & Co. Omnibus Incentive Plan (amended and restated as of April 25, 2013)	3,350

Long-Term Compensation and Incentive Plans

On March 26, 2014, the Board of Directors of the Company approved equity awards under the Company’s 2014 Long-Term Compensation Plan (“2014 LTC Plan”) for executive officers and other select personnel.

On March 6, 2013, the Board of Directors of the Company approved equity awards under the Company’s 2013 Long-Term Compensation Plan (“2013 LTC Plan”) for executive officers and other select personnel.

On March 7, 2012, the Board of Directors of the Company approved equity awards under the Company’s 2012 Long-Term Compensation Plan ("2012 LTC Plan") for executive officers and other select personnel.

Each of the respective LTC Plans for 2014, 2013 and 2012 included RSU and PSU awards and are subject to the terms of the Company's 2008 A.M. Castle & Co. Omnibus Incentive Plan, amended and restated as of April 25, 2013.

Restricted Share Units and Non-Vested Shares

The restricted share units ("RSUs") granted under the 2014 and 2013 LTC Plans will cliff vest on December 31, 2016 and December 31, 2015, respectively. Approximately 43 RSUs granted under the 2012 LTC Plan cliff vested on December 31, 2014. Each RSU that becomes vested entitles the participant to receive one share of the Company’s common stock. The number of shares delivered may be reduced by the number of shares required to be withheld for federal and state withholding tax requirements (determined at the market price of Company shares at the time of payout).

The outstanding non-vested share balance consists of shares issued to the Board of Directors. Non-vested shares were issued to the directors during the second quarter of 2014, 2013 and 2012 and will cliff vest after three years in the second quarter of 2017, 2016 and 2015, respectively.

The fair value of the RSUs and non-vested shares is established using the market price of the Company’s stock on the date of grant.

A summary of the non-vested share and RSU activity is as follows:



	Non-Vested Shares				Restricted Share Units
	Shares		Weighted-Average Grant Date Fair Value		Units		Weighted- Average Grant Date Fair Value
Outstanding at January 1, 2014	98		$	14.17	258		$	13.30
Granted	39		$	13.68	127		$	14.35
Forfeited	(12	)	$	12.55	(123	)	$	13.38
Vested	(18	)	$	13.84	(63	)	$	10.87
Outstanding at December 31, 2014	107		$	14.21	199		$	14.67
Expected to vest at December 31, 2014	107		$	14.21	165		$	14.63

The unrecognized compensation cost as of December 31, 2014 associated with RSU and non-vested share awards was $1,994. The total fair value of shares vested during the years ended December 31, 2014, 2013 and 2012 was $938, $1,106 and $1,685, respectively.

Performance Shares

Performance share unit ("PSU") awards are based on two independent conditions, the Company’s relative total shareholder return (“RTSR”), which represents a market condition, and Company-specific target goals for Return on Invested Capital (“ROIC”) as defined in the LTC Plans.

The status of PSUs that have been awarded as part of the active LTC Plans is summarized below as of December 31, 2014:



Plan Year	Grant Date Fair Value		Estimated Number of Performance Shares to be Issued	Maximum Number of Performance Shares that Could Potentially be Issued
2014 LTC Plan
RTSR performance condition	$	20.16	—	170
ROIC performance condition	$	14.35	—	170
2013 LTC Plan
RTSR performance condition	$	24.74	—	120
ROIC performance condition	$	16.29	—	120
2012 LTC Plan
RTSR performance condition	$	13.78	—	106
RTSR performance condition ^(a)	$	16.65	—	58
ROIC performance condition	$	10.02	—	106
ROIC performance condition ^(a)	$	12.74	—	58

^(a) Represents PSU awards granted in October 2012 under the 2012 LTC Plan.

The grant date fair values of PSU awards containing the RTSR performance condition were estimated using a Monte Carlo simulation with the following assumptions:



	2014			2013			2012
Grant Date Fair Value per Share Unit	$	20.16		$	24.74		$	13.78
Expected volatility	40.8		%	59.5		%	85.0		%
Risk-free interest rate	0.79		%	0.38		%	0.40		%
Expected life (in years)	2.77			2.82			2.81
Expected dividend yield	—			—			—

PSU awards under the 2012 LTC Plan were granted to the Company's CEO in October 2012. The grant date fair value of the CEO PSU awards containing the RTSR performance condition was estimated using a Monte Carlo simulation with the following assumptions:



	2012
Grant Date Fair Value per Share Unit	$	16.65
Expected volatility	60.7		%
Risk-free interest rate	0.34		%
Expected life (in years)	2.21
Expected dividend yield	—

The grant date fair values for PSU awards subject to the ROIC performance condition were established using the market price of the Company's common stock on the date of grant.

Final award vesting and distribution of performance awards granted under the 2012 LTC Plan was determined based on the Company’s actual performance versus the target goals for a three-year consecutive period (as defined in the 2012 Plan). Refer to the table above for the number of shares expected to be issued under 2012 LTC Plan. The unrecognized compensation cost as of December 31, 2014 associated with the 2014 and 2013 LTC Plan performance share units is $1,456.

Stock Options

A summary of stock option activity is as follows:



	Shares		Weighted Average Exercise Price		Intrinsic Value		Weighted Average Remaining Contractual Life
Stock options outstanding at January 1, 2014	144		$	12.89
Exercised	(17	)	$	9.09
Forfeited	(37	)	$	12.79
Expired	(8	)	$	14.22
Stock options outstanding at December 31, 2014	82		$	13.62	$	—	2.1
Stock options exercisable at December 31, 2014	82		$	13.62	$	—	2.1
Stock options vested as of December 31, 2014	82		$	13.62	$	—	2.1

The total intrinsic value of options exercised during the years ended December 31, 2014, 2013 and 2012 was $56, $914 and $36, respectively. There was no unrecognized compensation cost associated with stock options as of December 31, 2014.

~~(5)~~(9) Employee Benefit Plans

Pension Plans

~~Substantially all~~Certain employees ~~who meet certain requirements~~ of ~~age, length of service and hours worked per year~~the Company are covered by Company-sponsored pension plans and a supplemental pension plan (collectively, the “pension plans”). These pension plans are defined benefit, noncontributory plans. Benefits paid to retirees are based upon age at retirement, years of credited service and average earnings. The Company also has a supplemental pension plan, which is a non-qualified, unfunded plan. The Company uses a December 31 measurement date for the pension plans.

The Company-sponsored pension plans are frozen for all employees except for employees ~~of certain subsidiaries and employees~~ represented by the United Steelworkers of America. The assets of the Company-sponsored pension plans are maintained in a single trust account.

The Company’s funding policy is to satisfy the minimum funding requirements of the Employee Retirement Income Security Act of 1974, commonly called ERISA.

Components of net periodic pension plans cost (benefit) ~~are~~were as follows:


	2013			2012			2011			2014			2013			2012
Service cost	$	699		$	608		$	539		$	453		$	699		$	608
Interest cost	6,327			6,832			7,393			6,885			6,327			6,832
Expected return on assets	(9,278		)	(9,855		)	(10,054		)	(8,381		)	(9,278		)	(9,855		)
Amortization of prior service cost	322			324			324			282			322			324
Amortization of actuarial loss	1,942			594			229			1,717			1,942			594
Net periodic pension cost (benefit)	$	12		$	(1,497	)	$	(1,569	)
Net periodic pension plans cost (benefit)										$	956		$	12		$	(1,497	)

The expected amortization of pension prior service cost and actuarial loss for the next fiscal year isare $~~282~~378 and $~~1,716~~3,912, respectively.

5260

The status of the pension plans at December 31, ~~2013~~2014 and ~~2012~~2013 ~~are~~were as follows:


	2013			2012			2014			2013
Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	181,137		$	164,407		$	156,989		$	181,137
Service cost	699			608			453			699
Interest cost	6,327			6,832			6,885			6,327
Plan change							719			—
Benefit payments	(7,097		)	(6,558		)	(7,587		)	(7,097		)
Actuarial (gain) loss	(24,077		)	15,848
Actuarial loss (gain)							35,863			(24,077		)
Projected benefit obligation at end of year	$	156,989		$	181,137		$	193,322		$	156,989
Change in plan assets:
Fair value of plan assets at beginning of year	$	187,150		$	174,938		$	168,408		$	187,150
Actual (loss) return on assets	(11,966		)	18,463
Actual return (loss) on assets							22,521			(11,966		)
Employer contributions	321			307			329			321
Benefit payments	(7,097		)	(6,558		)	(7,587		)	(7,097		)
Fair value of plan assets at end of year	$	168,408		$	187,150		$	183,671		$	168,408
Funded status – net prepaid	$	11,419		$	6,013
Funded status – net (liability) prepaid							$	(9,651	)	$	11,419
Amounts recognized in the consolidated balance sheets consist of:
Prepaid pension cost	$	16,515		$	12,891		$	7,092		$	16,515
Accrued liabilities	(325		)	(309		)	(322		)	(325		)
Pension benefit obligations	(4,771		)	(6,569		)	(16,421		)	(4,771		)
Net amount recognized	$	11,419		$	6,013		$	(9,651	)	$	11,419
Pre-tax components of accumulated other comprehensive income (loss):
Pre-tax components of accumulated other comprehensive loss:
Unrecognized actuarial loss	$	(25,002	)	$	(29,778	)	$	(45,009	)	$	(25,002	)
Unrecognized prior service cost	(1,295		)	(1,617		)	(1,731		)	(1,295		)
Total	$	(26,297	)	$	(31,395	)	$	(46,740	)	$	(26,297	)
Accumulated benefit obligation	$	156,474		$	180,551		$	192,638		$	156,474

For the ~~plan~~plans with an accumulated benefit obligation in excess of plan assets, the projected benefit obligation, accumulated benefit obligation and fair value of plan assets were $66,341, $65,657 and $49,598, respectively, at December 31, 2014 and $5,095, $5,095 and $0, respectively, at December 31, 2013~~; and~~ ~~$5,893~~, ~~$5,893~~ ~~and~~ $0~~, respectively, at~~ ~~December 31, 2012~~.

The assumptions used to measure the projected benefit obligations for the Company’s defined benefit pension plans ~~are~~were as follows:


	2013		2012	2014	2013
Discount rate	4.50	%	3.50 - 3.75%	3.75%	4.50%
Projected annual salary increases	0 - 3.00%		0 - 3.00%	0 - 3.00%	0 - 3.00%

The assumptions used to determine net periodic pension cost (benefit) ~~are~~were as follows:


	2013		2012		2011		2014	2013	2012
Discount rate	3.50 - 3.75%		4.25	%	5.25	%	4.50%	3.50 - 3.75%	4.25%
Expected long-term rate of return on plan assets	5.25	%	5.75	%	6.50	%	5.25%	5.25%	5.75%
Projected annual salary increases	0 - 3.00%		0 - 3.00%		0 - 3.00%		0 - 3.00%	0 - 3.00%	0 - 3.00%

The Company’s expected return on plan assets is derived from reviews of asset allocation strategies and historical and anticipated future long-term performance of individual asset classes. The Company’s analysis gives consideration to historical returns and long-term, prospective rates of return.

The Company’s pension plan assets are allocated entirely to fixed income securities at December 31, ~~2013~~2014 and ~~2012~~2013.

The fair values of the Company’s pension plan assets fall within the following levels of the fair value hierarchy as of December 31, ~~2013~~2014:


	Level 1		Level 2		Level 3		Total			Level 1		Level 2		Level 3		Total
Fixed income securities ^(1)(a)	$	15,629	$	152,803	$	—	$	168,432		$	15,839	$	167,882	$	—	$	183,721
Accounts payable – pending trades							(24		)							(50		)
Total							$	168,408								$	183,671


^{(1)^(a)}	~~Fixed income securities are comprised of corporate bonds (71%), government bonds (20%), government agencies securities (~~5%~~) and other fixed income securities (~~4%Fixed income securities are comprised of corporate bonds (75%), government bonds (17%), government agencies securities (4%) and other fixed income securities (4%).

The fair values of the Company’s pension plan assets fall within the following levels of the fair value hierarchy as of December 31, ~~2012~~2013:


	Level 1		Level 2		Level 3		Total			Level 1		Level 2		Level 3		Total
Fixed income securities ^(2)(b)	$	10,562	$	176,610	$	—	$	187,172		$	15,629	$	152,803	$	—	$	168,432
Accounts payable – pending trades							(22		)							(24		)
Total							$	187,150								$	168,408


^{(2)^(b)}	~~Fixed income securities are comprised of corporate bonds (75%), government bonds (16%), government agencies securities (~~6%~~) and other fixed income securities (~~3% Fixed income securities are comprised of corporate bonds (71%), government bonds (20%), government agencies securities (5%) and other fixed income securities (4%).

The estimated future pension benefit payments are:


2014	$	7,994
2015	8,178		$	7,990
2016	8,523		8,392
2017	8,965		8,859
2018	9,181		9,185
2019 — 2023	49,926
2019			9,597
2020 — 2024			52,697

~~During~~ ~~2013, the~~The Company ~~was~~is party to a multi-employer pension ~~plans~~plan in ~~California and~~ Ohio. ~~The overall cost of such plans to the Company is insignificant. In~~ ~~2013~~, in connection with the January 2013 restructuring plan, the Company closed its facility in Gardena, California and elected to withdraw from the California multi-employer pension plan. The Company incurred a withdrawal liability of $720 which is recorded in "Restructuring Charges" in the Consolidated Statement of Operations. If the Company elects to withdraw from the Ohio multi-employer pension plan in the future, it could potentially incur a withdrawal liability at that time. The Ohio multi-employer pension plan withdrawal liability was estimated to be ~~$4,800~~$5,407 as of December 31, ~~2013~~2014. The Company was party to a multi-employer pension plan in California. In 2013, in connection with the January 2013 restructuring plan, the Company closed its facility in Gardena, California and elected to withdraw from the California multi-employer pension plan. The Company incurred a withdrawal liability of $720 which was charged to expense in 2013 within "Restructuring activity" in the Consolidated Statement of Operations.

~~Postretirement Plan~~

~~The Company also provides declining value life insurance to its retirees and a maximum of three years of medical coverage to qualified individuals who retire between the ages of~~ 62 ~~and~~ 65~~. The Company does not fund these benefits in advance, and uses a December 31 measurement date.~~

~~Components of net periodic postretirement benefit cost for~~ ~~2013~~, ~~2012~~ ~~and~~ ~~2011~~ ~~were as follows:~~

2013 2012 2011
Service cost $ 153
$ 161
$ 164
Interest cost 148
170
222
Amortization of prior service cost —
—
—
Amortization of actuarial gain (23 ) —
—
Net periodic postretirement benefit cost $ 278
$ 331
$ 386

~~The expected amortization of postretirement prior service cost and actuarial gain for the next fiscal year are insignificant.~~

~~The status of the postretirement benefit plans at~~ ~~December 31, 2013~~ ~~and~~ ~~2012~~ ~~were as follows:~~

2013 2012
Change in accumulated postretirement benefit obligations:
Accumulated postretirement benefit obligation at beginning of year $ 4,379
$ 4,635
Service cost 153
161
Interest cost 148
170
Benefit payments (201 ) (193 )
Actuarial gain (2,502 ) (394 )
Accumulated postretirement benefit obligation at end of year $ 1,977
$ 4,379
Funded status – net liability $ 1,977
$ 4,379
Amounts recognized in the consolidated balance sheets consist of:
Accrued liabilities $ (139 ) $ (296 )
Postretirement benefit obligations (1,838 ) (4,083 )
Net amount recognized $ (1,977 ) $ (4,379 )
Pre-tax components of accumulated other comprehensive income (loss):
Unrecognized actuarial gain $ 3,139
$ 661
Total $ 3,139
$ 661

~~The assumed health care cost trend rates for medical plans at December 31 were as follows:~~

2013 2012 2011
Medical cost trend rate 7.50 % 8.00 % 8.50 %
Ultimate medical cost trend rate 5.00 % 5.00 % 5.00 %
Year ultimate medical cost trend rate will be reached 2019
2019
2018

~~A 1% increase in the health care cost trend rate assumptions would have increased the accumulated postretirement benefit obligation at~~ ~~December 31, 2013~~ by $81 with no significant impact on the annual periodic postretirement benefit cost. A 1% decrease in the health care cost trend rate assumptions would have decreased the accumulated postretirement benefit obligation at ~~December 31, 2013~~ ~~by $75 with no significant impact on the annual periodic postretirement benefit cost.~~

~~The weighted average discount rate used to determine the net periodic postretirement benefit costs and the accumulated postretirement benefit obligations were as follows:~~

2013 2012 2011
Net periodic postretirement benefit costs 3.50 % 3.75 % 5.25 %
Accumulated postretirement benefit obligations 4.00 % 3.50 % 3.75 %

~~Retirement Savings Plans~~

The Company’s retirement savings plan for U.S. employees includes features under Section 401(k) of the Internal Revenue Code. Effective July 1, 2011, the Company’s 401(k) matching contribution was increased to ~~100%~~ ~~of each dollar on eligible employee contributions up to the first~~ 6% ~~of the employee’s pre-tax compensation and the Company’s fixed contribution of~~ 4% ~~of eligible earnings for all employees was eliminated. Company contributions cliff vest after two years of employment.~~

Effective July 1, 2012, the Company's 401(k) plan was amended to include the U.S. employees of Tube Supply. Employees were eligible to participate in the Company's 401(k) plan immediately. Tube Supply's existing plan assets were rolled over into the Company's 401(k) plan during 2012 as a result of this amendment.

~~The amounts expensed by the Company relating to its 401(k) plan and other international retirement plans was $4,265, $5,260 and $4,414 for the years ended~~ ~~December 31, 2013~~, ~~2012~~ ~~and~~ ~~2011, respectively.~~

~~(6) Joint Venture~~

~~Kreher Steel Company, LLC is a 50% owned joint venture of the Company. Kreher is a national distributor and processor of carbon and alloy steel bar products, headquartered in Melrose Park, Illinois.~~

~~The following information summarizes the Company’s participation in the joint venture as of and for the year ended December 31:~~

2013 2012 2011
Equity in earnings of joint venture $ 6,987
$ 7,224
$ 11,727
Investment in joint venture 41,879
38,854
36,460
Sales to joint venture 198
455
362
Purchases from joint venture 86
695
884

~~The following information summarizes financial data for this joint venture as of and for the year ended December 31:~~

2013 2012 2011
Revenues $ 230,351
$ 257,776
$ 269,657
Net income 13,720
14,603
23,643
Current assets 82,827
92,421
111,263
Non-current assets 25,615
26,099
22,979
Current liabilities 10,548
14,315
59,952
Non-current liabilities 16,103
27,845
3,089
Members’ equity 81,791
76,360
71,199
Capital expenditures 1,855
5,259
6,736
Depreciation and amortization 2,217
2,034
1,603

~~(7) Income Taxes~~

~~(Loss) income before income taxes and equity in earnings of joint venture generated by the Company’s U.S. and non-U.S. operations were as follows:~~

2013 2012 2011
U.S $ (55,611 ) $ (28,398 ) $ (26,321 )
Non-U.S. (5,133 ) 12,856
11,708

~~The Company’s income tax (benefit) expense is comprised of the following:~~

2013 2012 2011
Federal
current $ (260 ) $ (842 ) $ (1,204 )
deferred (16,913 ) (1,542 ) (2,041 )
State
current 1,312
629
461
deferred (2,949 ) 401
(1,218 )
Foreign
current 3,242
2,927
2,970
deferred (4,227 ) (143 ) (94 )
$ (19,795 ) $ 1,430
$ (1,126 )

~~The reconciliation between the Company’s effective tax rate on income or loss and the U.S. federal income tax rate of~~ ~~35%~~ ~~is as follows:~~

2013 2012 2011
Federal income tax at statutory rates $ (21,260 ) $ (5,439 ) $ (5,115 )
State income taxes, net of federal income tax benefits (1,757 ) 22
(1,007 )
Permanent items:
Dividends received deductions (766 ) (766 ) —
Convertible debt mark-to-market - non-deductible —
6,206
1,551
Other permanent differences (124 ) 480
662
Federal and state income tax on joint venture 2,670
2,766
4,478
Rate differential on foreign income 812
(1,680 ) (726 )
Unrecognized tax benefits —
(557 ) (576 )
Audit settlements —
218
—
State rate changes 87
(68 ) (478 )
Other 543
248
85
Income tax (benefit) expense $ (19,795 ) $ 1,430
$ (1,126 )
Effective income tax expense rate 32.6 % (9.2 )% 7.7 %

~~Significant components of the Company’s deferred tax assets and liabilities are as follows:~~

2013 2012
Deferred tax assets:
Postretirement benefits $ 2,526
$ 3,830
Deferred compensation 1,768
1,940
Restructuring related and other reserves 1,055
1,452
Alternative minimum tax and net operating loss carryforward 24,072
3,487
Other, net 69
—
Total deferred tax assets $ 29,490
$ 10,709
Deferred tax liabilities:
Depreciation $ 8,026
$ 8,032
Inventory 319
1,146
Pension 5,954
4,240
Intangible assets and goodwill 20,121
24,224
Other, net 2,561
1,665
Total deferred tax liabilities 36,981
39,307
Net deferred tax liabilities $ 7,491
$ 28,598

~~As of~~ ~~December 31, 2013, the Company has federal, state and foreign net operating losses ("NOLs") as follows:~~

Amount Expiration Period
Federal $ 43,158
2021 to 2023
State 50,520
2015 to 2032
Foreign 8,428
(a)

~~(a) Foreign NOLs of $1,060 expire in 2014 to 2018 and $7,368 do not expire.~~Secured Notes

The Company ~~evaluates~~filed a registration statement with the ~~recoverability of its deferred tax assets by assessing the adequacy of future taxable income from all sources, including the reversal of deferred tax liabilities, forecasted operating earnings~~Securities and ~~tax planning strategies. Based~~Exchange Commission on ~~all current available evidence,~~Form S-4 on April 11, 2012. The registration statement was declared effective on June 12, 2012.

On June 12, 2012, the Company ~~has determined that it is more likely than not that the federal, state and foreign NOLs will be realized due~~commenced an offer to having sufficient earnings in future years to utilize the NOL carryforwards prior to expiration. To the extent that the Company does not consider it more likely than not that a deferred tax asset will be recovered, a valuation allowance would be established.

~~The following table shows the net change in the Company’s unrecognized tax benefits:~~

2013 2012 2011
Balance as of January 1 $ 105
$ 861
$ 1,465
Increases (decreases) in unrecognized tax benefits:
Due to tax positions taken in prior years —
—
91
Due to tax positions taken during the current year 60
45
60
Due to settlement with tax authorities —
(757 ) —
Due to expiration of statute (60 ) (44 ) (755 )
Balance as of December 31 $ 105
$ 105
$ 861

~~Unrecognized tax benefits of $105~~, ~~$105 and $861 would impact the effective tax rate if recognized as of~~ ~~December 31, 2013~~, ~~2012~~ ~~and~~ ~~2011, respectively. The accrued interest and penalties related to unrecognized tax benefits were insignificant at~~ ~~December 31, 2013~~ ~~and~~ ~~2012. The interest and penalties recorded by the Company were insignificant for the years ended~~ ~~December 31, 2013~~, ~~2012~~ ~~and~~ ~~2011~~.

~~During 2013,~~ ~~2012~~ ~~and~~ ~~2011~~, statutes expired on certain unrecognized tax benefits of the Company. The reversal of the reserve of these unrecognized tax benefits was recorded as a component of overall income tax benefit for the years ended ~~December 31, 2013~~, ~~2012~~ ~~and~~ ~~2011, respectively.~~

~~The Company or its subsidiaries files income tax returns in the United States federal jurisdiction, 29 states, and 7 foreign jurisdictions.~~

~~The following tax years remain open to examination by the major taxing jurisdictions to which the Company is subject:~~



~~U.S. Federal~~	~~2010 to 2013~~
~~U.S. States~~	~~2009 to 2013~~
~~Foreign~~	~~2008 to 2013~~

~~During the second quarter of 2012, audits of the Company’s~~ ~~2008 and 2009~~ ~~U.S. federal income tax returns were concluded with~~ no ~~significant assessment. During 2011, the Company recognized~~ ~~$423~~ of tax benefits, excluding interest, due to the expiration of the statute of limitations for uncertain tax positions taken in prior years. Due to the potential for resolution of the examination or expiration of statutes of limitations, it is reasonably possible that the Company’s gross unrecognized tax benefits may change within the next 12 ~~months by a range of~~ ~~zero~~ to ~~$45~~.

~~The Company received its 2012 federal income tax refund of $2,590 during October 2013, its 2010 federal tax refund of~~ ~~$2,025~~ ~~during February 2012 and its 2009 federal income tax refund of~~ ~~$6,344~~ ~~during January 2011.~~

~~(8) Goodwill and Intangible Assets~~

~~The changes in carrying amounts of goodwill during the years ended~~ ~~December 31, 2013~~ ~~and~~ ~~2012~~ ~~were as follows:~~

2013 2012
Metals
Segment Plastics
Segment Total Metals
Segment Plastics
Segment Total
Balance as of January 1
Goodwill $ 117,544
$ 12,973
$ 130,517
$ 117,145
$ 12,973
$ 130,118
Accumulated impairment losses (60,217 ) —
(60,217 ) (60,217 ) —
(60,217 )
57,327
12,973
70,300
56,928
12,973
69,901
Currency valuation (1,011 ) —
(1,011 ) 399
—
399
Balance as of December 31
Goodwill 116,533
12,973
129,506
117,544
12,973
130,517
Accumulated impairment losses (60,217 ) —
(60,217 ) (60,217 ) —
(60,217 )
$ 56,316
$ 12,973
$ 69,289
$ 57,327
$ 12,973
$ 70,300

The Company tests goodwill for impairment at the reporting unit level on an annual basis and more often if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. The Company assesses, at least quarterly, whether any triggering events have occurred.

During the fourth quarter of fiscal year 2013, the Company changed its goodwill testing date for both reporting units from January 1 to December 1. During fiscal year 2013, the annual impairment test was performed at January 1, 2013 and December 1, 2013, with no identified impairment charges. The Company's year-to-date operating results, among other factors, are considered in determining whether it is more likely than not that the fair value for either reporting unit has declined below its carrying value, which would require the Company to perform an interim goodwill impairment test. A recession or economic declines in specific industries could change management's expectations of future financial results and/or key valuation assumptions used in determining the fair-value of its reporting units, which could result in a goodwill impairment.

~~The following summarizes the components of the Company's intangible assets at~~ ~~December 31, 2013~~ ~~and~~ ~~2012~~:

2013 2012
Gross Carrying
Amount Accumulated
Amortization Gross Carrying
Amount Accumulated
Amortization
Customer relationships $ 117,794
$ 55,157
$ 119,118
$ 45,317
Non-compete agreements 3,888
3,569
3,888
3,235
Trade names 8,025
1,939
8,297
1,188
Developed technology 1,400
953
1,400
486
Total $ 131,107
$ 61,618
$ 132,703
$ 50,226

The weighted-average amortization period for the intangible assets is 10.8 years, 11.3 years for customer relationships, 9.6 years for trade names, 3 years for non-compete agreements and 3 years for developed technology. Substantially all of the Company’s intangible assets were acquired as part of the acquisitions of Transtar on ~~September 5, 2006~~ ~~and Tube Supply on~~ ~~December 15, 2011~~.

~~For the years ended~~ ~~December 31, 2013~~, ~~2012, and~~ ~~2011, the aggregate amortization expense was $11,791, $11,843 and $6,867, respectively.~~

~~The following is a summary of the estimated annual amortization expense for each of the next 5 years:~~

2014 $ 11,700
2015 10,933
2016 10,933
2017 8,910
2018 4,790

~~(9) Debt~~

~~Short-term and long-term debt consisted of the following at~~ ~~December 31, 2013~~ ~~and~~ ~~2012~~:

2013 2012
SHORT-TERM DEBT
Foreign $ —
$ 500
Total short-term debt —
500
LONG-TERM DEBT
12.75% Senior Secured Notes due December 15, 2016 210,000
225,000
7.0% Convertible Notes due December 15, 2017 57,500
57,500
Revolving Credit Facility due December 15, 2015 —
39,500
Other, primarily capital leases 998
1,400
Total long-term debt 268,498
323,400
Less: unamortized discount (22,502 ) (26,831 )
Less: current portion (397 ) (415 )
Total long-term portion 245,599
296,154
TOTAL SHORT-TERM AND LONG-TERM DEBT $ 245,996
$ 297,069

~~During December of 2011, in conjunction with the completion of the Acquisition (see~~ ~~Note 2), the Company issued~~exchange $225,000 ~~aggregate~~ principal amount of 12.75% Senior Secured Notes due 2016, which are registered under the Securities Act of 1933 (the ~~“Secured~~“New Secured Notes”), for $~~57,500~~225,000 principal amount of outstanding 12.75% Senior Secured Notes due 2016, which had not been registered under the Securities Act of 1933 (the “Old Secured Notes”). The terms of the New Secured Notes issued are identical in all material respects to the Old Secured Notes, except that the New Secured Notes are registered under the Securities Act of 1933, do not have any of the transfer restrictions, registration rights and additional interest provisions relating to the Old Secured Notes and bear a different CUSIP number from the Old Secured Notes. The Company did not receive any proceeds from the exchange offer.

The New Secured Notes will mature on December 15, 2016. The Company will pay interest on the New Secured Notes at a rate of 12.75% per annum in cash semi-annually. The Company paid interest of $26,775, $28,548 and $28,688 on the New Secured Notes during the years ended December 31, 2014, 2013 and 2012, respectively. The New Secured Notes are fully and unconditionally guaranteed, jointly and severally, by certain 100% owned domestic subsidiaries of the Company (the “Note Guarantors”). The New Secured Notes and the related guarantees are secured by a lien on substantially all of the Company's and the Note Guarantors' assets, subject to certain exceptions and permitted liens pursuant to a pledge and security agreement. The terms of the New Secured Notes contain numerous covenants imposing financial and operating restrictions on the Company's business. These covenants place restrictions on the Company's ability and the ability of its subsidiaries to, among other things, pay dividends, redeem stock or make other distributions or restricted payments; incur indebtedness or issue common stock; make certain investments; create liens; agree to payment restrictions affecting certain subsidiaries; consolidate or merge; sell or otherwise transfer or dispose of assets, including equity interests of certain subsidiaries; enter into transactions with affiliates, enter into sale and leaseback transactions; and use the proceeds of permitted sales of the Company's assets. Refer to Note 14 - Guarantor Financial Information.

Convertible Notes

The Convertible Notes will mature on December 15, 2017. The Company will pay interest on the Convertible Notes at a rate of 7.0% in cash semi-annually. The Company paid interest of $4,025, $4,025 and $4,025 on the Convertible ~~Senior~~ Notes ~~due 2017 (the “Convertible Notes”)~~during the years ended December 31, 2014, 2013 and ~~entered into~~2012, respectively. The Convertible Notes are fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis by the Note Guarantors. The initial conversion rate for the Convertible Notes is 97.2384 shares of the Company’s common stock per $~~100,000~~1 ~~senior secured asset based revolving credit facility (the “Revolving Credit Facility”). Net proceeds from these transactions (collectively referred~~principal amount of Convertible Notes, equivalent to an initial conversion price of approximately $10.28 per share of common stock. The conversion rate will be subject to adjustment, but will not be adjusted for accrued and unpaid interest, if any. In addition, if an event constituting a fundamental change occurs, the Company will in some cases increase the conversion rate for a holder that elects to convert its Convertible Notes in connection with such fundamental change. Upon conversion, the Company will pay and/or deliver, as the ~~“Debt Transactions”~~case may be, cash, shares of common stock or a combination of cash and shares of common stock, at the Company’s election, together with cash in lieu of fractional shares.

Holders may convert their Convertible Notes at their option on any day prior to the close of business on the scheduled trading day immediately preceding June 15, 2017 only under the following circumstances: (1) during the five business-day period after any five consecutive trading-day period (the “measurement period”) ~~were used to complete~~in which the ~~Acquisition, repay existing debt~~trading price per note for each day of that measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the applicable conversion rate on each such day; (2) during any calendar quarter (and only during such calendar quarter) after the calendar quarter ended December 31, 2011, if the last reported sale price of the Company’s common stock for ~~general corporate purposes. The Company incurred debt origination fees~~20 or more trading days (whether or not consecutive) during the period of ~~$18,136~~30 ~~associated with~~consecutive trading days ending on the ~~Debt Transactions~~last trading day of the immediately preceding calendar quarter is equal to or greater than 130% of the applicable conversion price in effect for each applicable trading day; (3) upon the occurrence of specified corporate events, including certain dividends and distributions; or (4) if the Company calls the Convertible Notes for redemption on or after December 20, 2015. The Convertible Notes will be convertible, regardless of the foregoing circumstances, at any time from, and including, June 15, 2017 through the second scheduled trading day immediately preceding the maturity date.

of December 31, 2011. The initial value allocated to the derivative liability was $22,330 of the $57,500 principal amount of the Convertible Notes, which ~~are primarily being~~represents a discount to the debt to be amortized through interest expense using the effective interest method ~~and recognized~~through the maturity of the Convertible Notes. Accordingly, the effective interest ~~expense~~rate used to amortize the debt discount on the Convertible Notes was determined to be 17.78%. During each reporting period prior to April 26, 2012, the derivative liability was marked to fair value through earnings.

On April 26, 2012, at the Company's Annual Meeting of Stockholders, shareholder approval was obtained for the issuance of shares in excess of ~~$3,375~~19.99% of the Company's outstanding common stock to satisfy any conversions of the Convertible Notes. Additionally, shareholder approval was obtained to amend the Company's charter to authorize additional shares of common stock from 30,000 to 60,000. With these approvals, the Company now has the ability to share-settle the conversion option in full and therefore, the embedded conversion option is no longer required to be separately valued and accounted for ~~underwriting fees~~as a derivative liability. As of April 26, 2012, the conversion option's cumulative value of $42,037 was reclassified to additional paid-in capital and will no longer be marked-to-market through earnings. The deferred tax benefit of $8,285 associated with the ~~debt financing. In 2011,~~temporary difference between the financial reporting basis of the derivative liability and its tax basis at the date of issuance (December 15, 2011) was also reclassified to additional paid-in capital.

Revolving Credit Facility

Net interest expense reported on the consolidated statements of operations was reduced by interest income from investment of excess cash balances of $81 in 2014, $35 in 2013 and $222 in 2012.

(5) Fair Value Measurements

The three-tier value hierarchy the Company utilizes, which prioritizes the inputs used in the valuation methodologies, is:

Level 1—Valuations based on quoted prices for identical assets and liabilities in active markets.

Level 3—Valuations based on unobservable inputs reflecting our own assumptions, consistent with reasonably available assumptions made by other market participants.

Fair Value Measurements of Debt

hierarchy, is determined based on similar debt instruments that do not contain a conversion feature, as well as other factors related to the callable nature of the notes.

The main inputs and assumptions into the fair value model for the Convertible Notes at December 31, 2014 were as follows:



Company's stock price at the end of the period	$	7.98
Expected volatility	38.3		%
Credit spreads	9.28		%
Risk-free interest rate	1.08		%

Fair Value Measurements of Commodity Hedges

The liabilities measured at fair value on a recurring basis were as follows:



	Level 1		Level 2		Level 3		Total ^(a)
As of December 31, 2014
Derivative liability for commodity hedges	$	—	$	1,615	$	—	$	1,615
As of December 31, 2013
Derivative liability for commodity hedges	$	—	$	2,871	$	—	$	2,871

(6) Lease Agreements

The Company has operating and capital leases covering certain warehouse and office facilities, equipment, automobiles and trucks, with the lapse of time as the basis for all rental payments.

Future minimum rental payments under operating and capital leases that have initial or remaining non-cancelable lease terms in excess of one year as of December 31, 2014 are as follows:



	Capital		Operating
2015	$	738	$	14,091
2016	470		12,879
2017	49		10,909
2018	—		9,399
2019	—		7,702
Later years	—		23,400
Total future minimum rental payments	$	1,257	$	78,380

Total rental payments charged to expense were $14,173 in 2014, $15,062 in 2013, and $15,579 in 2012. Lease extrication charges of $186 and $1,448 associated with restructuring activities in the Metals segment were included in total rental payments charged to expense in 2014 and 2013, respectively, within "Restructuring activity" in the Consolidated Statement of Operations. There were no lease extrication charges in 2012. Total gross value of property, plant and equipment under capital leases was $2,452 and $1,660 in 2014 and 2013, respectively.

(7) Stockholders' Equity

Shareholder Rights Plan

Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss as reported in the consolidated balance sheets as of December 31, 2014 and 2013 was comprised of the following:



	2014			2013
Foreign currency translation losses	$	(9,994	)	$	(4,617	)
Unrecognized pension and postretirement benefit costs, net of tax	(35,571		)	(14,126		)
Total accumulated other comprehensive loss	$	(45,565	)	$	(18,743	)

Changes in accumulated other comprehensive loss by component for the years ended December 31, 2014 and 2013 are as follows:



	Defined Benefit Pension and Postretirement Items						Foreign Currency Items						Total
	2014			2013			2014			2013			2014			2013
Balance as of January 1,	$	(14,126	)	$	(18,749	)	$	(4,617	)	$	(2,322	)	$	(18,743	)	$	(21,071	)
Other comprehensive (loss) income before reclassifications	(23,108		)	3,256			(5,377		)	(2,295		)	(28,485		)	961
Amounts reclassified from accumulated other comprehensive loss, net of tax ^(a)	1,663			1,367			—			—			1,663			1,367
Net current period other comprehensive (loss) income	(21,445		)	4,623			(5,377		)	(2,295		)	(26,822		)	2,328
Balance as of December 31,	$	(35,571	)	$	(14,126	)	$	(9,994	)	$	(4,617	)	$	(45,565	)	$	(18,743	)

^(a)See reclassifications from accumulated other comprehensive loss table for details of reclassification from accumulated other comprehensive loss for the year ended December 31, 2014.

Reclassifications from accumulated other comprehensive loss for the years ended December 31, 2014 and 2013 are as follows:



	Year ended December 31,
	2014			2013
Unrecognized pension and postretirement benefit items:
Prior service cost^(b)	$	(282	)	$	(322	)
Actuarial loss ^(b)	(1,381		)	(1,919		)
Total before Tax	(1,663		)	(2,241		)
Tax effect	—			874
Total reclassifications for the period, net of tax	$	(1,663	)	$	(1,367	)

(8) Share-based Compensation



Plan Description	Authorized Shares
1995 Directors Stock Option Plan	188
1996 Restricted Stock and Stock Option Plan	938
2000 Restricted Stock and Stock Option Plan	1,200
2004 Restricted Stock, Stock Option and Equity Compensation Plan	1,350
2008 A. M. Castle & Co. Omnibus Incentive Plan (amended and restated as of April 25, 2013)	3,350

Long-Term Compensation and Incentive Plans

Restricted Share Units and Non-Vested Shares

The fair value of the RSUs and non-vested shares is established using the market price of the Company’s stock on the date of grant.

A summary of the non-vested share and RSU activity is as follows:



	Non-Vested Shares				Restricted Share Units
	Shares		Weighted-Average Grant Date Fair Value		Units		Weighted- Average Grant Date Fair Value
Outstanding at January 1, 2014	98		$	14.17	258		$	13.30
Granted	39		$	13.68	127		$	14.35
Forfeited	(12	)	$	12.55	(123	)	$	13.38
Vested	(18	)	$	13.84	(63	)	$	10.87
Outstanding at December 31, 2014	107		$	14.21	199		$	14.67
Expected to vest at December 31, 2014	107		$	14.21	165		$	14.63

Performance Shares

The status of PSUs that have been awarded as part of the active LTC Plans is summarized below as of December 31, 2014:



Plan Year	Grant Date Fair Value		Estimated Number of Performance Shares to be Issued	Maximum Number of Performance Shares that Could Potentially be Issued
2014 LTC Plan
RTSR performance condition	$	20.16	—	170
ROIC performance condition	$	14.35	—	170
2013 LTC Plan
RTSR performance condition	$	24.74	—	120
ROIC performance condition	$	16.29	—	120
2012 LTC Plan
RTSR performance condition	$	13.78	—	106
RTSR performance condition ^(a)	$	16.65	—	58
ROIC performance condition	$	10.02	—	106
ROIC performance condition ^(a)	$	12.74	—	58

^(a) Represents PSU awards granted in October 2012 under the 2012 LTC Plan.

The grant date fair values of PSU awards containing the RTSR performance condition were estimated using a Monte Carlo simulation with the following assumptions:



	2014			2013			2012
Grant Date Fair Value per Share Unit	$	20.16		$	24.74		$	13.78
Expected volatility	40.8		%	59.5		%	85.0		%
Risk-free interest rate	0.79		%	0.38		%	0.40		%
Expected life (in years)	2.77			2.82			2.81
Expected dividend yield	—			—			—



	2012
Grant Date Fair Value per Share Unit	$	16.65
Expected volatility	60.7		%
Risk-free interest rate	0.34		%
Expected life (in years)	2.21
Expected dividend yield	—

The grant date fair values for PSU awards subject to the ROIC performance condition were established using the market price of the Company's common stock on the date of grant.

Stock Options

A summary of stock option activity is as follows:



	Shares		Weighted Average Exercise Price		Intrinsic Value		Weighted Average Remaining Contractual Life
Stock options outstanding at January 1, 2014	144		$	12.89
Exercised	(17	)	$	9.09
Forfeited	(37	)	$	12.79
Expired	(8	)	$	14.22
Stock options outstanding at December 31, 2014	82		$	13.62	$	—	2.1
Stock options exercisable at December 31, 2014	82		$	13.62	$	—	2.1
Stock options vested as of December 31, 2014	82		$	13.62	$	—	2.1

(9) Employee Benefit Plans

Pension Plans

Certain employees of the Company are covered by Company-sponsored pension plans and a supplemental pension plan (collectively, the “pension plans”). These pension plans are defined benefit, noncontributory plans. Benefits paid to retirees are based upon age at retirement, years of credited service and average earnings. The Company also has a supplemental pension plan, which is a non-qualified, unfunded plan. The Company uses a December 31 measurement date for the pension plans.

The Company-sponsored pension plans are frozen for all employees except for employees represented by the United Steelworkers of America. The assets of the Company-sponsored pension plans are maintained in a single trust account.

The Company’s funding policy is to satisfy the minimum funding requirements of the Employee Retirement Income Security Act of 1974, commonly called ERISA.

Components of net periodic pension plans cost (benefit) were as follows:



	2014			2013			2012
Service cost	$	453		$	699		$	608
Interest cost	6,885			6,327			6,832
Expected return on assets	(8,381		)	(9,278		)	(9,855		)
Amortization of prior service cost	282			322			324
Amortization of actuarial loss	1,717			1,942			594
Net periodic pension plans cost (benefit)	$	956		$	12		$	(1,497	)

The expected amortization of pension prior service cost and actuarial loss for the next fiscal year are $378 and $3,912, respectively.

The status of ~~$6,153~~the pension plans at December 31, 2014 and 2013 were as follows:



	2014			2013
Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	156,989		$	181,137
Service cost	453			699
Interest cost	6,885			6,327
Plan change	719			—
Benefit payments	(7,587		)	(7,097		)
Actuarial loss (gain)	35,863			(24,077		)
Projected benefit obligation at end of year	$	193,322		$	156,989
Change in plan assets:
Fair value of plan assets at beginning of year	$	168,408		$	187,150
Actual return (loss) on assets	22,521			(11,966		)
Employer contributions	329			321
Benefit payments	(7,587		)	(7,097		)
Fair value of plan assets at end of year	$	183,671		$	168,408
Funded status – net (liability) prepaid	$	(9,651	)	$	11,419
Amounts recognized in the consolidated balance sheets consist of:
Prepaid pension cost	$	7,092		$	16,515
Accrued liabilities	(322		)	(325		)
Pension benefit obligations	(16,421		)	(4,771		)
Net amount recognized	$	(9,651	)	$	11,419
Pre-tax components of accumulated other comprehensive loss:
Unrecognized actuarial loss	$	(45,009	)	$	(25,002	)
Unrecognized prior service cost	(1,731		)	(1,295		)
Total	$	(46,740	)	$	(26,297	)
Accumulated benefit obligation	$	192,638		$	156,474

For the plans with an accumulated benefit obligation in excess of plan assets, the projected benefit obligation, accumulated benefit obligation and fair value of plan assets were $66,341, $65,657 and $49,598, respectively, at December 31, 2014 and $5,095, $5,095 and $0, respectively, at December 31, 2013.

The assumptions used to measure the projected benefit obligations for the Company’s defined benefit pension plans were as follows:



	2014	2013
Discount rate	3.75%	4.50%
Projected annual salary increases	0 - 3.00%	0 - 3.00%

The assumptions used to determine net periodic pension cost (benefit) were as follows:



	2014	2013	2012
Discount rate	4.50%	3.50 - 3.75%	4.25%
Expected long-term rate of return on plan assets	5.25%	5.25%	5.75%
Projected annual salary increases	0 - 3.00%	0 - 3.00%	0 - 3.00%

The Company’s pension plan assets are allocated entirely to fixed income securities at December 31, 2014 and 2013.

The Company’s pension plans’ funds are managed in accordance with investment policies recommended by its investment advisor and approved by the ~~extinguishment~~Human Resources Committee of ~~its previously existing debt which included prepayment fees~~the Board of Directors. The overall target portfolio allocation is 100% fixed income securities. These funds’ conformance with style profiles and performance is monitored regularly by management, with the assistance of the Company’s investment advisor. Adjustments are typically made in the subsequent quarters when investment allocations deviate from the target range. The investment advisor provides quarterly reports to management and the ~~write-off~~Human Resources Committee of ~~previously existing deferred financing costs.~~the Board of Directors.

The fair values of the Company’s pension plan assets fall within the following levels of the fair value hierarchy as of December 31, 2014:



	Level 1		Level 2		Level 3		Total
Fixed income securities ^(a)	$	15,839	$	167,882	$	—	$	183,721
Accounts payable – pending trades							(50		)
Total							$	183,671

^(a)Fixed income securities are comprised of corporate bonds (75%), government bonds (17%), government agencies securities (4%) and other fixed income securities (4%).

The fair values of the Company’s pension plan assets fall within the following levels of the fair value hierarchy as of December 31, 2013:



	Level 1		Level 2		Level 3		Total
Fixed income securities ^(b)	$	15,629	$	152,803	$	—	$	168,432
Accounts payable – pending trades							(24		)
Total							$	168,408

^(b) Fixed income securities are comprised of corporate bonds (71%), government bonds (20%), government agencies securities (5%) and other fixed income securities (4%).

The estimated future pension benefit payments are:



2015	$	7,990
2016	8,392
2017	8,859
2018	9,185
2019	9,597
2020 — 2024	52,697

The Company is party to a multi-employer pension plan in Ohio. If the Company elects to withdraw from the Ohio multi-employer pension plan in the future, it could potentially incur a withdrawal liability at that time. The Ohio multi-employer pension plan withdrawal liability was estimated to be $5,407 as of December 31, 2014. The Company was party to a multi-employer pension plan in California. In 2013, in connection with the January 2013 restructuring plan, the Company closed its facility in Gardena, California and elected to withdraw from the California multi-employer pension plan. The Company incurred a withdrawal liability of $720 which was charged to expense in 2013 within "Restructuring activity" in the Consolidated Statement of Operations.

Secured Notes

The Company filed a registration statement with the Securities and Exchange Commission on Form S-4 on April 11, 2012. The registration statement was declared effective on June 12, 2012.

On June 12, 2012, the Company commenced an offer to exchange $225,000 principal amount of 12.75% Senior Secured Notes due 2016, which are registered under the Securities Act of 1933 (the “New Secured Notes”), for $225,000 principal amount of outstanding 12.75% Senior Secured Notes due 2016, which had not been registered under the Securities Act of 1933 (the “Old Secured Notes”). The terms of the New Secured Notes issued are identical in all material respects to the Old Secured Notes, except that the New Secured Notes are registered under the Securities Act of 1933, do not have any of the transfer restrictions, registration rights and additional interest provisions relating to the Old Secured Notes and bear a different CUSIP number from the Old Secured Notes. The Company did not receive any proceeds from the exchange offer.

The New Secured Notes will mature on December 15, 2016. The Company will pay interest on the New Secured Notes at a rate of 12.75% per annum in cash semi-annually. The Company paid interest of ~~$28,548~~$26,775, $28,548 and $28,688 on the New Secured Notes during the years ended December 31, 2014, 2013 and 2012, respectively. The New Secured Notes are fully and unconditionally guaranteed, jointly and severally, by certain 100% owned domestic subsidiaries of the Company (the “Note Guarantors”). The New Secured Notes and the related guarantees are secured by a lien on substantially all of the Company's and the Note Guarantors' assets, subject to certain exceptions and permitted liens pursuant to a pledge and security agreement. The terms of the New Secured Notes contain numerous covenants imposing financial and operating restrictions on the Company's business. These covenants place restrictions on the Company's ability and the ability of its subsidiaries to, among other things, pay dividends, redeem stock or make other distributions or restricted payments; incur indebtedness or issue common stock; make certain investments; create liens; agree to payment restrictions affecting certain subsidiaries; consolidate or merge; sell or otherwise transfer or dispose of assets, including equity interests of certain subsidiaries; enter into transactions with affiliates, enter into sale and leaseback transactions; and use the proceeds of permitted sales of the Company's assets. Refer to Note 15 ~~for~~14 - Guarantor Financial Information ~~disclosure.~~.

On or after December 15, 2014, the Company may redeem some or all of the New Secured Notes at a redemption premium of 106.375% of the principal amount for the 12-month period beginning December 15, 2014 and 100% thereafter, ~~plus accrued and unpaid interest. Prior to December 15, 2014, the Company may redeem up to~~ ~~35%~~ ~~of the aggregate principal amount of the New Secured Notes at a redemption price of~~ ~~112.75%~~ of the principal amount, plus accrued and unpaid interest, with the net cash proceeds of certain equity offerings. In addition, the Company may, at its option, redeem some or all of the New Secured Notes at any time prior to December 15, 2014, by paying a “make-whole” premium, plus accrued and unpaid interest.

Subject to certain conditions, within 95 days after the end of each fiscal year, the Company must make an offer to purchase New Secured Notes with certain of its excess cash flow ~~for such fiscal year~~ (as defined in the indenture) for such fiscal year, commencing with the fiscal year ending December 31, 2012, at 103% of the principal amount thereof, plus accrued and unpaid interest. For the fiscal year ended December 31, ~~2013~~2014, the Company estimated that it had no excess cash flow (as defined in the indenture) and therefore, an offer to purchase New Secured Notes will not be made. The Company had no excess cash flow (as defined in the indenture) for the fiscal year ended December 31, 2013. For the fiscal year ended December 31, 2012, the Company estimated excess cash flow to be approximately $17,000 and therefore, an offer to purchase New Secured Notes was made on April 1, 2013. This offer expired on April 30, 2013 with no Secured Notes tendered.

Convertible Notes

~~The last reported sale price of the Company's common stock was~~ ~~equal to or greater than 130%~~ ~~of the applicable conversion price in effect for each applicable trading day for at least~~ 20 ~~of the last~~ 30 ~~trading days ending on~~ ~~December 31, 2013~~; therefore, the Convertible Note holders may convert their Convertible Notes during the three month period ending March 31, 2014. If any Convertible Notes were to be surrendered, the Company would settle them via a combination of cash and shares of its common stock. If all the Convertible Notes were to be surrendered, the Company has estimated that it would deliver cash of ~~$57,500~~ ~~and issue approximately~~ ~~1,537~~ ~~shares of common stock. Although the conversion of the Convertible Notes is outside the control of the Company at~~ ~~December 31, 2013, the discounted value of the outstanding Convertible Notes are classified as long-term debt in the Consolidated Balance Sheets at~~ ~~December 31, 2013~~ ~~as the Company would have the ability and intent to utilize its revolving credit facility, which is classified as long-term, to settle the cash portion of the conversion.~~

On April 26, 2012, at the Company's Annual Meeting of Stockholders, shareholder approval was obtained for the issuance of shares in excess of ~~20%~~19.99% of the Company's outstanding common stock to satisfy any conversions of the Convertible Notes. Additionally, shareholder approval was obtained to amend the Company's charter to authorize additional shares of common stock from 30,000 to 60,000. With these approvals, the Company now has the ability to share-settle the conversion option in full and therefore, the embedded conversion option is no longer required to be separately valued and accounted for as a derivative liability. As of April 26, 2012, the conversion option's cumulative value of $42,037 was reclassified to additional paid-in capital and will no longer be marked-to-market through earnings. The deferred tax benefit of $8,285 associated with the temporary difference between the financial reporting basis of the derivative liability and its tax basis at the date of issuance (December 15, 2011) was also reclassified to additional paid-in capital.

The Company may not redeem the Convertible Notes prior to December 20, ~~2015.~~ 2015. On or after December 20, 2015, the Company may redeem all or part of the Convertible Notes (except for the Convertible Notes that ~~we are~~the Company is required to repurchase as described above) if the last reported sale price of the Company’s common stock exceeds 135% of the applicable conversion price for 20 or more trading days in a period of 30 consecutive trading days ending on the trading day immediately prior to the date of the redemption notice. The redemption price will equal the sum of 100% of the principal amount of the Convertible Notes to be redeemed, plus accrued and unpaid interest, plus a “make-whole premium” payment. The Company must make the "make-whole" premium payments on all Convertible Notes called for redemption including Convertible Notes converted after the date we delivered the notice of redemption. The Company will pay the redemption price in cash except for any non-cash portion of the "make-whole" premium.

Revolving Credit Facility

The Revolving Credit Facility consists of a $~~100,000~~125,000 senior secured asset-based revolving credit facility (subject to adjustment pursuant to a borrowing base described below), of which (a) up to an aggregate principal amount of $20,000 will be available for a Canadian subfacility, (b) up to an aggregate principal amount of $20,000 will be available for letters of credit and (c) up to an aggregate principal amount of $10,000 will be available for swingline loans. Loans under the Revolving Credit Facility will be made available to the Company and certain domestic subsidiaries (the “U.S. Borrowers”) in U.S. dollars and the Canadian Borrowers in U.S. dollars and Canadian dollars. ~~The Revolving Credit Facility will mature~~In December 2014, the Company obtained an extension on its revolving credit facility, which extended the maturity date from December 15, 2015 to December 10, 2019 (or 91 days prior to the maturity date of the Company's Senior Secured Notes or Convertible Notes if they have not been refinanced).

At the Company’s election, borrowings under the Revolving Credit Facility will bear interest at variable rates based on (a) a customary base rate plus an applicable margin of between 0.50% and 1.00% (depending on quarterly average undrawn availability under the Revolving Credit Facility) or (b) an adjusted LIBOR rate plus an applicable margin of between 1.50% and 2.00% (depending on quarterly average undrawn availability under the Revolving Credit Facility). The weighted average interest rate on borrowings outstanding under the revolving credit facilities were ~~2.71%~~3.08%, 2.71% and ~~1.63%~~2.71% for the years ended December 31, ~~2013~~2014, ~~2012~~2013 and ~~2011,~~2012, respectively. The Company will pay certain customary recurring fees with respect to the Revolving Credit Facility.

commitments. In January 2014, the Company partially exercised the accordion option under its revolving credit facility to increase the aggregate commitments by $25,000. As a result, the Company's borrowing capacity increased from $100,000 to ~~$125,000, and the~~$125,000. The Company maintains the ~~ability~~option to exercise the accordion for an additional $25,000 of aggregate commitments in the ~~future.~~future, assuming it meets certain thresholds for incurring additional debt.

The Revolving Credit facility contains a springing financial maintenance covenant requiring the Company to maintain the ratio of EBITDA (as defined in the agreement) to fixed charges of 1.1 to 1.0 when excess availability is less than the greater of 10% of the calculated borrowing base (as defined in the agreement) or $~~10,000~~12,500. In addition, if excess availability is less than the greater of 12.5% of the calculated borrowing base (as defined in the agreement) or $~~12,500~~15,625, the lender has the right to take full dominion of the Company’s cash collections and apply these proceeds to outstanding loans under the Revolving Credit Agreement. The Company's ratio of EBITDA to fixed charges was negative for the twelve months ended December 31, 2014. At this negative ratio, the Company's current maximum borrowing capacity would be $100,397 before triggering full dominion of the Company's cash collections. As of December 31, ~~2013~~2014, the ~~Company’s excess availability~~Company had $41,197 of ~~$90,308 was above such thresholds.~~additional unrestricted borrowing capacity available under the Revolving Credit Facility.

Net interest expense reported on the consolidated statements of operations was reduced by interest income from investment of excess cash balances of $81 in 2014, $35 in 2013, and $222 in 2012 ~~and $254 in~~ ~~2011~~.

~~(10)~~(5) Fair Value Measurements

The three-tier value hierarchy the Company utilizes, which prioritizes the inputs used in the valuation methodologies, is:

Level 1—Valuations based on quoted prices for identical assets and liabilities in active markets.

Level 3—Valuations based on unobservable inputs reflecting our own assumptions, consistent with reasonably available assumptions made by other market participants.

The Company’s pension plan asset portfolio as of December 31, ~~2013~~2014 and ~~2012~~2013 is primarily invested in fixed income securities, which generally fall within Level 2 of the fair value hierarchy. Fixed income securities in the pension plan asset portfolio are valued based on evaluated prices provided to the trustee by independent pricing services. Such prices may be determined by factors which include, but are not limited to, market quotations, yields, maturities, call features, ratings, institutional size trading in similar groups of securities and developments related to specific securities. Refer to Note 5 for pension fair value disclosures.

Fair Value Measurements of Debt

The fair value of the Company’s Senior Secured Notes as of December 31, ~~2013~~2014 was estimated to be ~~$234,675~~$216,808 compared to a carrying value of ~~$205,033, net of unamortized discount.~~$210,000. The fair value for the Senior Secured Notes is determined based on recent trades of the bonds and fall within Level 2 of the fair value hierarchy.

The fair value of the Convertible Notes, as of December 31, ~~2013~~2014 was estimated to be approximately ~~$90,991~~$61,932 compared to a carrying value of ~~$39,965, net of unamortized discount.~~$57,500. The fair value for the Convertible Notes, which fall within Level 3 of the fair value

hierarchy, is determined based on similar debt instruments that do not contain a conversion feature, as well as other factors related to the callable nature of the notes.

The main inputs and assumptions into the fair value model for the Convertible Notes at December 31, ~~2013~~2014 were as follows:


Company's stock price at the end of the period	$	14.77		$	7.98
Expected volatility	27.2		%	38.3		%
Credit spreads	7.25		%	9.28		%
Risk-free interest rate	1.24		%	1.08		%

As of December 31, ~~2013~~2014, the ~~Company had no~~estimated fair value of the Company's debt outstanding under its revolving credit ~~facilities.~~facility, which falls within Level 3 of the fair value hierarchy, was $51,253 compared to its carrying value of $59,200. The fair value was calculated based on the present value of the outstanding debt using the revolving credit facility interest rate as of December 31, 2014 plus a premium and assuming the current amount of debt outstanding as of December 31, 2014 was outstanding until the maturity of the Company's facility in December 2019. Although borrowings could be materially greater or less than the current ~~balance~~amount of borrowings outstanding at ~~December 31, 2013~~,the end of the period, it is not practical to estimate

the amounts that may be outstanding during the future periods since there is no predetermined borrowing or repayment schedule.

Fair Value Measurements of Commodity Hedges

The Company has a commodity hedging program to mitigate risks associated with certain commodity price fluctuations. At December 31, ~~2013~~2014, the Company had executed forward contracts that extend through 2016. The counterparty to these contracts is not considered a credit risk by the Company. At December 31, ~~2013~~2014 and ~~2012~~2013, the notional value associated with forward contracts was ~~$12,492~~$7,486 and ~~$17,191,~~$12,492, respectively. The Company recorded, through cost of materials, realized and unrealized net losses of $288, $2,141 ~~$430~~ and ~~$2,377~~$430 during the years ended December 31, ~~2013~~2014, ~~2012~~2013 and ~~2011,~~2012, respectively, as a result of the decline in the fair value of the contracts. As of December 31, 2014 and 2013, all commodity hedge contracts were in a liability position. ~~As of~~ ~~December 31, 2012, a receivable of~~ ~~$19~~ ~~associated with commodity hedge contracts was netted with the liability to derive the value disclosed in the table below.~~ Refer to Note 1312 - Commitments and Contingent Liabilities for letters of credit outstanding for collateral associated with commodity hedges.

The liabilities measured at fair value on a recurring basis were as follows:


	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total ^(a)
As of December 31, 2014
Derivative liability for commodity hedges									$	—	$	1,615	$	—	$	1,615
As of December 31, 2013
Derivative liability for commodity hedges	$	—	$	2,871	$	—	$	2,871	$	—	$	2,871	$	—	$	2,871
As of December 31, 2012
Derivative liability for commodity hedges	$	—	$	2,494	$	—	$	2,494

(6) Lease Agreements

The Company has operating and capital leases covering certain warehouse and office facilities, equipment, automobiles and trucks, with the lapse of time as the basis for all rental payments.

Future minimum rental payments under operating and capital leases that have initial or remaining non-cancelable lease terms in excess of one year as of December 31, 2014 are as follows:



	Capital		Operating
2015	$	738	$	14,091
2016	470		12,879
2017	49		10,909
2018	—		9,399
2019	—		7,702
Later years	—		23,400
Total future minimum rental payments	$	1,257	$	78,380

~~(11)~~(7) Stockholders' Equity

Shareholder Rights Plan

Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss as reported in the consolidated balance sheets as of December 31, 2014 and 2013 was comprised of the following:



	2014			2013
Foreign currency translation losses	$	(9,994	)	$	(4,617	)
Unrecognized pension and postretirement benefit costs, net of tax	(35,571		)	(14,126		)
Total accumulated other comprehensive loss	$	(45,565	)	$	(18,743	)

Changes in accumulated other comprehensive loss by component for the years ended December 31, 2014 and 2013 are as follows:



	Defined Benefit Pension and Postretirement Items						Foreign Currency Items						Total
	2014			2013			2014			2013			2014			2013
Balance as of January 1,	$	(14,126	)	$	(18,749	)	$	(4,617	)	$	(2,322	)	$	(18,743	)	$	(21,071	)
Other comprehensive (loss) income before reclassifications	(23,108		)	3,256			(5,377		)	(2,295		)	(28,485		)	961
Amounts reclassified from accumulated other comprehensive loss, net of tax ^(a)	1,663			1,367			—			—			1,663			1,367
Net current period other comprehensive (loss) income	(21,445		)	4,623			(5,377		)	(2,295		)	(26,822		)	2,328
Balance as of December 31,	$	(35,571	)	$	(14,126	)	$	(9,994	)	$	(4,617	)	$	(45,565	)	$	(18,743	)

^(a)See reclassifications from accumulated other comprehensive loss table for details of reclassification from accumulated other comprehensive loss for the year ended December 31, 2014.

Reclassifications from accumulated other comprehensive loss for the years ended December 31, 2014 and 2013 are as follows:



	Year ended December 31,
	2014			2013
Unrecognized pension and postretirement benefit items:
Prior service cost^(b)	$	(282	)	$	(322	)
Actuarial loss ^(b)	(1,381		)	(1,919		)
Total before Tax	(1,663		)	(2,241		)
Tax effect	—			874
Total reclassifications for the period, net of tax	$	(1,663	)	$	(1,367	)

(8) Share-based Compensation

The consolidated compensation cost recorded for the Company’s share-based compensation arrangements was $1,972, $3,062 ~~$2,277~~ and ~~$4,349~~$2,277 for ~~2013~~2014, ~~2012~~2013 and ~~2011~~2012, respectively. The total income tax benefit recognized in the consolidated statements of operations for share-based compensation arrangements was $189, $1,141 ~~$872~~ and ~~$1,534~~$872 in ~~2013~~2014, ~~2012~~2013 and ~~2011~~2012, respectively. All compensation expense related to share-based compensation arrangements is recorded in sales, general and administrative expense. The unrecognized compensation cost as of December 31, ~~2013~~2014 associated with all share-based payment arrangements is ~~$4,610~~$3,450 and the weighted average period over which it is to be expensed is 1.4 years.



Plan Description	Authorized Shares
1995 Directors Stock Option Plan	188
1996 Restricted Stock and Stock Option Plan	938
2000 Restricted Stock and Stock Option Plan	1,200
2004 Restricted Stock, Stock Option and Equity Compensation Plan	1,350
2008 A. M. Castle & Co. Omnibus Incentive Plan (amended and restated as of April 25, 2013)	3,350

Long-Term Compensation and Incentive Plans

On March 6, 2013, ~~the Human Resources Committee (the “Committee”) of~~ the Board of Directors of the Company approved equity awards under the Company’s 2013 Long-Term Compensation Plan (“2013 LTC Plan”) for executive officers and other select personnel.

On March 7, 2012, the ~~Committee~~Board of Directors of the Company approved equity awards under the Company’s 2012 Long-Term Compensation Plan ("2012 LTC Plan") for executive officers and other select personnel.

~~On March 2, 2011, the Committee approved equity awards under the Company's 2011 Long-Term Compensation Plan ("2011 LTC Plan") for executive officers and other select personnel.~~

Each of the respective LTC Plans for 2014, 2013 ~~2012~~ and ~~2011~~2012 included RSU and PSU awards and are subject to the terms of the Company's 2008 A.M. Castle & Co. Omnibus Incentive Plan, amended and restated as of April 25, 2013.

Restricted Share Units and Non-Vested Shares

The ~~RSUs~~restricted share units ("RSUs") granted under the ~~2013~~2014 and ~~2012~~2013 LTC Plans will cliff vest on December 31, ~~2015~~2016 and December 31, ~~2014,~~2015, respectively. Approximately 4643 RSUs granted under the ~~2011~~2012 LTC Plan cliff vested on December 31, ~~2013.~~2014. Each RSU that becomes vested entitles the participant to receive one share of the Company’s common stock. The number of shares delivered may be reduced by the number of shares required to be withheld for federal and state withholding tax requirements (determined at the market price of Company shares at the time of payout).

The outstanding non-vested share balance consists of shares issued to the Board of ~~Directors~~Directors. Non-vested shares were issued to the directors during the second quarter of 2014, 2013 and 2012 and ~~shares issued for retention incentive purposes. The Director shares~~will cliff vest ~~during~~after three years in the second quarter of 2017, 2016 and 2015, ~~and the balance of the shares vest on December 31, 2014. The RSU share balance consists of units granted to employees for incentive purposes.~~respectively.

The fair value of the RSUs and non-vested shares is established using the market price of the Company’s stock on the date of grant.

A summary of the non-vested share and RSU activity is as follows:


	Shares				Units				Non-Vested Shares				Restricted Share Units
	Shares		Weighted-Average Grant Date Fair Value		Units		Weighted- Average Grant Date Fair Value		Shares		Weighted-Average Grant Date Fair Value		Units		Weighted- Average Grant Date Fair Value
Outstanding at January 1, 2013	73		$	12.22	298		$	12.05
Outstanding at January 1, 2014									98		$	14.17	258		$	13.30
Granted	40		$	16.66	128		$	16.19	39		$	13.68	127		$	14.35
Forfeited	(15	)	$	13.82	(94	)	$	11.94	(12	)	$	12.55	(123	)	$	13.38
Vested	—		$	—	(74	)	$	15.00	(18	)	$	13.84	(63	)	$	10.87
Outstanding at December 31, 2013	98		$	14.17	258		$	13.30
Expected to vest at December 31, 2013	98		$	14.17	221		$	13.01
Outstanding at December 31, 2014									107		$	14.21	199		$	14.67
Expected to vest at December 31, 2014									107		$	14.21	165		$	14.63

The unrecognized compensation cost as of December 31, ~~2013~~2014 associated with RSU and non-vested share awards ~~is $2,593.~~was $1,994. The total fair value of shares vested during the years ended December 31, 2014, 2013 and 2012 was $938, $1,106 and ~~2011 was $1,106,~~ $1,685, ~~and $2,166,~~ respectively.

6658

Performance Shares

The status of PSUs that have been awarded as part of the active LTC Plans is summarized below as of December 31, ~~2013:~~2014:


Plan Year	Grant Date Fair Value		Estimated Number of Performance Shares to be Issued	Maximum Number of Performance Shares that Could Potentially be Issued	Grant Date Fair Value		Estimated Number of Performance Shares to be Issued	Maximum Number of Performance Shares that Could Potentially be Issued
2014 LTC Plan
RTSR performance condition					$	20.16	—	170
ROIC performance condition					$	14.35	—	170
2013 LTC Plan
RTSR performance condition	$	24.74	59	196	$	24.74	—	120
ROIC performance condition	$	16.29	—	196	$	16.29	—	120
2012 LTC Plan
RTSR performance condition	$	13.78	85	178	$	13.78	—	106
RTSR performance condition⁽¹⁾	$	16.65	28	58
RTSR performance condition ^(a)					$	16.65	—	58
ROIC performance condition	$	10.02	—	178	$	10.02	—	106
ROIC performance condition ⁽¹⁾	$	12.74	—	58
2011 LTC Plan
RTSR performance condition	$	23.89	35	116
RTSR performance condition ⁽¹⁾	$	10.61	9	32
ROIC performance condition	$	17.13	—	116
ROIC performance condition ⁽¹⁾	$	12.74	—	32
ROIC performance condition ^(a)					$	12.74	—	58

^{(1) (a)}Represents ~~the status of performance share units~~PSU awards granted in October 2012 under the ~~active~~2012 LTC ~~Plans in October 2012.~~Plan.

The grant date fair values of ~~PSUs awarded~~PSU awards containing the RTSR performance condition were estimated using a Monte Carlo simulation with the following assumptions:



	2014			2013			2012
Grant Date Fair Value per Share Unit	$	20.16		$	24.74		$	13.78
Expected volatility	40.8		%	59.5		%	85.0		%
Risk-free interest rate	0.79		%	0.38		%	0.40		%
Expected life (in years)	2.77			2.82			2.81
Expected dividend yield	—			—			—

2013 2012 2011
Grant Date Fair Value per Share Unit $ 24.74
$ 13.78
$ 23.89
Expected volatility 59.5 % 85.0 % 62.0 %
Risk-free interest rate 0.38 % 0.40 % 1.10 %
Expected life (in years) 2.82
2.81
2.84
Expected dividend yield —
—
—

PSUs under the active LTC Plans were granted to the Company's new CEO in October 2012. The grant date fair values of PSUs awarded to the CEO containing the market-based performance condition was estimated using a Monte Carlo simulation with the following assumptions:


	2012			2011			2012
Grant Date Fair Value per Share Unit	$	16.65		$	10.61		$	16.65
Expected volatility	60.7		%	60.7		%	60.7		%
Risk-free interest rate	0.34		%	0.34		%	0.34		%
Expected life (in years)	2.21			1.21			2.21
Expected dividend yield	—			—			—

The grant date fair values for ~~PSUs~~PSU awards subject to the ROIC performance condition were established using the market price of the Company's common stock on the date of grant.

Final award vesting and distribution of performance awards granted under the ~~2011~~2012 LTC Plan was determined based on the Company’s actual performance versus the target goals for a three-year consecutive period (as defined in the ~~2011~~2012 Plan). Refer to the table above for the number of shares expected to be issued under ~~2011~~2012 LTC Plan. The unrecognized compensation cost as of December 31, ~~2013~~2014 associated with the 2014 and 2013 ~~and 2012~~ LTC ~~Plans~~Plan performance share units is ~~$2,017.~~$1,456.

6759

Stock Options

~~There were~~ no ~~stock options issued under the 2013, 2012 and 2011 LTC Plans.~~ A summary of ~~the~~ stock option activity is as follows:

Shares Weighted
Average
Exercise Price Intrinsic
Value Weighted Average
Remaining
Contractual Life
Stock options outstanding at January 1, 2013 270
$ 11.34

Exercised (115 ) $ 9.27

Forfeited (10 ) $ 12.79

Expired (1 ) $ 12.79

Stock options outstanding at December 31, 2013 144
$ 12.89
$ 280
3.0
Stock options exercisable at December 31, 2013 144
$ 12.89
$ 280
3.0
Stock options vested as of December 31, 2013 144
$ 12.89
$ 280
3.0



	Shares		Weighted Average Exercise Price		Intrinsic Value		Weighted Average Remaining Contractual Life
Stock options outstanding at January 1, 2014	144		$	12.89
Exercised	(17	)	$	9.09
Forfeited	(37	)	$	12.79
Expired	(8	)	$	14.22
Stock options outstanding at December 31, 2014	82		$	13.62	$	—	2.1
Stock options exercisable at December 31, 2014	82		$	13.62	$	—	2.1
Stock options vested as of December 31, 2014	82		$	13.62	$	—	2.1

The total intrinsic value of options exercised during the years ended December 31, 2014, 2013 and 2012 was $56, $914 and ~~2011~~$36, respectively. There was ~~$914, $36 and $194, respectively. The~~no unrecognized compensation cost associated with stock options as of December 31, ~~2013 associated with stock options is $0.~~2014.

~~(12) Stockholders' Equity~~(9) Employee Benefit Plans

~~Shareholder Rights Plan~~Pension Plans

~~In August 2012, the Company's Board of Directors adopted a Shareholder Rights Plan (the “Rights Plan”) and declared a dividend of~~ ~~one~~ ~~right for each outstanding share of the Company's common stock outstanding at the close of business on~~ ~~September 11, 2012. Pursuant to the Rights Plan, the Company issued~~ ~~one~~ ~~preferred stock purchase right (a “Right”) for each share of common stock outstanding on~~ ~~September 11, 2012. Each Right, once exercisable, represents the right to purchase one one-hundredth of a share (a “Unit”) of Series B Junior Preferred Stock~~Certain employees of the Company ~~without par value,~~are covered by Company-sponsored pension plans and a supplemental pension plan (collectively, the “pension plans”). These pension plans are defined benefit, noncontributory plans. Benefits paid to retirees are based upon age at retirement, years of credited service and average earnings. The Company also has a supplemental pension plan, which is a non-qualified, unfunded plan. The Company uses a December 31 measurement date for the pension plans.

The Company’s funding policy is to satisfy the minimum funding requirements of the Employee Retirement Income Security Act of 1974, commonly called ERISA.

Components of net periodic pension plans cost (benefit) were as follows:



	2014			2013			2012
Service cost	$	453		$	699		$	608
Interest cost	6,885			6,327			6,832
Expected return on assets	(8,381		)	(9,278		)	(9,855		)
Amortization of prior service cost	282			322			324
Amortization of actuarial loss	1,717			1,942			594
Net periodic pension plans cost (benefit)	$	956		$	12		$	(1,497	)

The expected amortization of pension prior service cost and actuarial loss for the next fiscal year are $~~54.00~~378 and $3,912, ~~subject~~respectively.

The status of the pension plans at December 31, 2014 and 2013 were as follows:



	2014			2013
Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	156,989		$	181,137
Service cost	453			699
Interest cost	6,885			6,327
Plan change	719			—
Benefit payments	(7,587		)	(7,097		)
Actuarial loss (gain)	35,863			(24,077		)
Projected benefit obligation at end of year	$	193,322		$	156,989
Change in plan assets:
Fair value of plan assets at beginning of year	$	168,408		$	187,150
Actual return (loss) on assets	22,521			(11,966		)
Employer contributions	329			321
Benefit payments	(7,587		)	(7,097		)
Fair value of plan assets at end of year	$	183,671		$	168,408
Funded status – net (liability) prepaid	$	(9,651	)	$	11,419
Amounts recognized in the consolidated balance sheets consist of:
Prepaid pension cost	$	7,092		$	16,515
Accrued liabilities	(322		)	(325		)
Pension benefit obligations	(16,421		)	(4,771		)
Net amount recognized	$	(9,651	)	$	11,419
Pre-tax components of accumulated other comprehensive loss:
Unrecognized actuarial loss	$	(45,009	)	$	(25,002	)
Unrecognized prior service cost	(1,731		)	(1,295		)
Total	$	(46,740	)	$	(26,297	)
Accumulated benefit obligation	$	192,638		$	156,474

The assumptions used to ~~adjustment.~~ measure the projected benefit obligations for the Company’s defined benefit pension plans were as follows:



	2014	2013
Discount rate	3.75%	4.50%
Projected annual salary increases	0 - 3.00%	0 - 3.00%

The ~~Rights become exercisable~~assumptions used to determine net periodic pension cost (benefit) were as follows:



	2014	2013	2012
Discount rate	4.50%	3.50 - 3.75%	4.25%
Expected long-term rate of return on plan assets	5.25%	5.25%	5.75%
Projected annual salary increases	0 - 3.00%	0 - 3.00%	0 - 3.00%

The Company’s pension plan assets are allocated entirely to fixed income securities at December 31, 2014 and 2013.

The Company’s pension plans’ funds are managed in accordance with investment policies recommended by its investment advisor and approved by the Human Resources Committee of the Board of Directors. The overall target portfolio allocation is 100% fixed income securities. These funds’ conformance with style profiles and performance is monitored regularly by management, with the assistance of the Company’s investment advisor. Adjustments are typically made in the ~~event any individual person or entity, without Board approval, acquires~~ ~~10%~~ ~~or more~~subsequent quarters when investment allocations deviate from the target range. The investment advisor provides quarterly reports to management and the Human Resources Committee of the Company's common stock, subject to certain exceptions. In these circumstances, each holder of a Right (other than rights held by the acquirer) will be entitled to purchase, at the then-current exercise price of the Right, additional shares of the Company's common stock having a value of twice the exercise price of the Right. Additionally, if the Company is involved in a merger or other business combination transaction with another person after which its common stock does not remain outstanding, each Right will entitle its holder to purchase, at the then-current exercise price of the Right, shares of common stock of the ultimate parent of such other person having a market value of twice the exercise price of the Right. The Rights may be redeemed by the Company for ~~$0.001~~ ~~per Right at any time until the~~ ~~tenth business day following the first public announcement of an acquisition of beneficial ownership of~~ ~~10%~~ of the Company's common stock. On August 13, 2013, the Company's Board of Directors agreed to extend the Rights Plan from August 30, 2013, when it was originally set to expire, to August 30, 2014, unless the rights issued thereunder are earlier redeemed or the Rights Plan is amended by the Board of Directors.

~~Accumulated Other Comprehensive Loss~~The fair values of the Company’s pension plan assets fall within the following levels of the fair value hierarchy as of December 31, 2014:



	Level 1		Level 2		Level 3		Total
Fixed income securities ^(a)	$	15,839	$	167,882	$	—	$	183,721
Accounts payable – pending trades							(50		)
Total							$	183,671

~~Accumulated~~^(a)Fixed income securities are comprised of corporate bonds (75%), government bonds (17%), government agencies securities (4%) and other ~~comprehensive loss as reported in~~fixed income securities (4%).

The fair values of the ~~consolidated balance sheets~~Company’s pension plan assets fall within the following levels of the fair value hierarchy as of December 31, 2013 ~~and~~ ~~2012~~ ~~was comprised of the following:~~:

2013 2012
Foreign currency translation losses $ (4,617 ) $ (2,322 )
Unrecognized pension and postretirement benefit costs, net of tax (14,126 ) (18,749 )
Total accumulated other comprehensive loss $ (18,743 ) $ (21,071 )



	Level 1		Level 2		Level 3		Total
Fixed income securities ^(b)	$	15,629	$	152,803	$	—	$	168,432
Accounts payable – pending trades							(24		)
Total							$	168,408

^(b) Fixed income securities are comprised of corporate bonds (71%), government bonds (20%), government agencies securities (5%) and other fixed income securities (4%).

The estimated future pension benefit payments are:



2015	$	7,990
2016	8,392
2017	8,859
2018	9,185
2019	9,597
2020 — 2024	52,697

Postretirement Plan

The Company also provides declining value life insurance to its retirees and a maximum of three years of medical coverage to qualified individuals who retire between the ages of 62 and 65. The Company does not fund these benefits in advance, and uses a December 31 measurement date.

6862

~~Changes in accumulated other comprehensive loss by component~~Components of net periodic postretirement plan (benefit) cost for ~~the~~ ~~year ended December 31,~~ 2014, 2013 ~~are~~and 2012 were as follows:

Defined Benefit Pension and Postretirement Items Foreign Currency Items Total
Balance as of January 1, 2013 $ (18,749 ) $ (2,322 ) $ (21,071 )
Other comprehensive loss before reclassifications 3,256
(2,295 ) 961
Amounts reclassified from accumulated other comprehensive loss, net of tax ^(a)
1,367
—
1,367
Net current period other comprehensive income (loss) 4,623
(2,295 ) 2,328
Balance as of December 31, 2013 $ (14,126 ) $ (4,617 ) $ (18,743 )



	2014			2013			2012
Service cost	$	56		$	153		$	161
Interest cost	76			148			170
Amortization of prior service cost	—			—			—
Amortization of actuarial gain	(336		)	(23		)	—
Net periodic postretirement plan (benefit) cost	$	(204	)	$	278		$	331

^(a)~~See the table below for details~~The expected amortization of ~~reclassification from accumulated other comprehensive loss~~postretirement plan prior service cost and actuarial gain for the next fiscal year are insignificant.

The status of the postretirement plan at ~~year ended~~ December 31, ~~2013~~2014.

~~Reclassifications from accumulated other comprehensive loss for the~~ and ~~year ended December 31,~~ 2013 ~~are~~was as follows:

Amount Reclassified from Accumulated Other Comprehensive Loss
Details about Accumulated Other Comprehensive Loss Components Year ended December 31, 2013
Amortization of defined benefit pension and postretirement items
Prior service cost^(b)
$ (322 )
Actuarial loss ^(b)
(1,919 )
Total before Tax (2,241 )
Tax benefit 874
Total reclassifications for the period, net of tax $ (1,367 )



	2014			2013
Change in accumulated postretirement benefit obligations:
Accumulated postretirement benefit obligation at beginning of year	$	1,977		$	4,379
Service cost	56			153
Interest cost	76			148
Benefit payments	(224		)	(201		)
Actuarial loss (gain)	667			(2,502		)
Accumulated postretirement benefit obligation at end of year	$	2,552		$	1,977
Funded status – net liability	$	(2,552	)	$	(1,977	)
Amounts recognized in the consolidated balance sheets consist of:
Accrued liabilities	$	(226	)	$	(139	)
Postretirement benefit obligations	(2,326		)	(1,838		)
Net amount recognized	$	(2,552	)	$	(1,977	)
Pre-tax components of accumulated other comprehensive loss:
Unrecognized actuarial gain	$	2,137		$	3,139
Total	$	2,137		$	3,139

The assumed health care cost trend rates for medical plans at December 31 were as follows:



	2014	2013	2012
Medical cost trend rate	7.00%	7.50%	8.00%
Ultimate medical cost trend rate	5.00%	5.00%	5.00%
Year ultimate medical cost trend rate will be reached	2019	2019	2019

^(b)A 1% increase in the health care cost trend rate assumptions would have increased the accumulated postretirement benefit obligation at ~~These~~December 31, 2014 by $114 with no significant impact on the annual periodic postretirement benefit cost. A 1% decrease in the health care cost trend rate assumptions would have decreased the accumulated postretirement benefit obligation at December 31, 2014 by $105 with no significant impact on the annual periodic postretirement benefit cost.

The weighted average discount rate used to determine the net periodic postretirement benefit costs and the accumulated postretirement benefit obligations were as follows:



	2014	2013	2012
Net periodic postretirement benefit costs	4.00%	3.50%	3.75%
Accumulated postretirement benefit obligations	3.25%	4.00%	3.50%

Retirement Savings Plans

The Company’s retirement savings plan for U.S. employees includes features under Section 401(k) of the Internal Revenue Code. The Company provides a 401(k) matching contribution of 100% of each dollar on eligible employee contributions up to the first 6% of the employee’s pre-tax compensation. Company contributions cliff vest after two years of employment.

The amounts expensed by the Company relating to its 401(k) plan and other ~~comprehensive loss components are~~international retirement plans were $3,743, $4,265 and $5,260 for the years ended December 31, 2014, 2013 and 2012, respectively.

(10) Restructuring Activity

As part of the Company's efforts to adapt operations to market conditions, restructuring activities related to the Company's organizational structure and operations were announced during January of 2013. In October 2013, the Company announced the consolidation of additional facilities in locations where it had redundant operations, and in June 2014, the company announced organizational changes that included workforce reductions. The October 2013 and June 2014 consolidations and organizational changes were part of the Company's continuous improvement plans to lower structural operating costs. Restructuring activity is primarily included in the ~~computation of net periodic pension and postretirement benefit cost~~Company's Metals segment. Restructuring activity for the Company's Other segment, which includes the costs of the executive, legal, and finance departments shared by both the Metals and Plastics segments, are insignificant.

The Company recorded the following restructuring activity during the years ended December 31, 2014 and 2013:



	Year Ended December 31,
	2014			2013
Employee termination and related benefits	$	937		$	2,702
Moving costs associated with plant consolidations	1,450			4,487
Lease termination costs	186			1,448
Gain on sale of fixed assets	(5,533		)	—
Other exit costs	—			366
Inventory write-offs	—			1,236
Total (benefit) expense	$	(2,960	)	$	10,239

Restructuring activity during the year ended December 31, 2014 consisted of a gain on the sale of fixed assets in Houston where the Company completed a plant consolidation, partially offset by employee termination and related benefits for the workforce reductions announced in June 2014, moving costs associated with plant consolidations announced in October 2013 and lease termination costs related to the restructuring activities announced in January 2013.

Restructuring activity during the year ended December 31, 2013 consisted of moving costs, employee termination and related benefits related to workforce reductions, lease termination costs, inventory write-offs and other exit costs associated with the plant consolidations announced in January and October 2013. The January 2013 announced restructuring activities are complete.

Restructuring activity associated with the write-off of inventory is included in "Cost of materials" in the Consolidated Statement of Operations. All other restructuring activity is recorded to the "Restructuring activity" line item within the Consolidated Statement of Operations as it is incurred. Through December 31, 2014, the Company recognized cumulative net charges of $7,279 related to restructuring activity which was consistent with expectations. The Company anticipates no additional charges for the previously announced restructuring activities.

Restructuring reserve activity for the years ended December 31, 2014 and 2013 is summarized below:



			Period Activity
	Balance January 1		Costs (gains)			Cash (payments) receipts			Impairment			Balance December 31 ^(a)
2014 Activity:
Employee termination and related benefits	$	129	$	937		$	(1,066	)	$	—		$	—
Moving costs associated with plant consolidations	—		1,450			(1,450		)	—			—
Lease termination costs	921		186			(471		)	—			636
Gain on sale of fixed assets	—		(5,533		)	5,533			—			—
Total 2014 Activity	$	1,050	$	(2,960	)	$	2,546		$	—		$	636
2013 Activity:
Employee termination and related benefits	$	—	$	2,702		$	(2,573	)	$	—		$	129
Moving costs associated with plant consolidations	—		4,487			(4,318		)	(169		)	—
Lease termination costs	—		1,448			(527		)	—			921
Other exit costs	—		366			(366		)	—			—
Inventory write-offs	—		1,236			—			(1,236		)	—
Total 2013 Activity	$	—	$	10,239		$	(7,784	)	$	(1,405	)	$	1,050

^(a) ~~(see~~ ~~Note 5~~ ~~for~~Payments on certain of the lease obligations are scheduled to continue until 2017. Market conditions and the Company’s ability to sublease these properties could affect the ultimate charge related to the lease obligations. Any potential recoveries or additional ~~details).~~charges could affect amounts reported in the consolidated financial statements of future periods. As of December 31, 2014, the short-term portion of the lease termination costs in the restructuring liability of $564 is included in "Accrued and other liabilities" and the long-term portion of $72 is included in "Other non-current liabilities" in the Consolidated Balance Sheet.

~~(13)~~(11) Income Taxes

(Loss) income before income taxes and equity in earnings of joint venture generated by the Company’s U.S. and non-U.S. operations were as follows:



	2014			2013			2012
U.S.	$	(112,904	)	$	(55,611	)	$	(28,398	)
Non-U.S.	(30,841		)	(5,133		)	12,856

The Company’s income tax (benefit) expense is comprised of the following:



	2014			2013			2012
Federal
current	$	—		$	(260	)	$	(842	)
deferred	(6,773		)	(16,913		)	(1,542		)
State
current	361			1,312			629
deferred	(948		)	(2,949		)	401
Foreign
current	(1,898		)	3,242			2,927
deferred	7,905			(4,227		)	(143		)
	$	(1,353	)	$	(19,795	)	$	1,430

The reconciliation between the Company’s effective tax rate on income or loss and the U.S. federal income tax rate of 35% is as follows:



	2014			2013			2012
Federal income tax at statutory rates	$	(50,310	)	$	(21,260	)	$	(5,439	)
State income taxes, net of federal income tax benefits	(2,117		)	(1,757		)	22
Permanent items:
Dividends received deductions	—			(766		)	(766		)
Convertible debt mark-to-market - non-deductible	—			—			6,206
Goodwill impairment	10,454			—			—
Other permanent differences	285			(124		)	480
Federal and state income tax on joint venture	2,912			2,670			2,766
Rate differential on foreign income	11,512			812			(1,680		)
Valuation allowance	24,572			—			—
Unrecognized tax benefits	—			—			(557		)
Audit settlements	99			—			218
Other	1,240			630			180
Income tax (benefit) expense	$	(1,353	)	$	(19,795	)	$	1,430
Effective income tax expense rate	0.9		%	32.6		%	(9.2		)%

Significant components of the Company’s deferred tax assets and liabilities are as follows as of December 31, 2014 and 2013:



	2014			2013
Deferred tax assets:
Pension and postretirement benefits	$	4,714		$	2,526
Deferred compensation	2,109			1,768
Restructuring related and other reserves	943			1,055
Alternative minimum tax and net operating loss carryforward	40,787			24,072
Inventory	5,218			—
Other, net	1,833			69
Deferred tax assets before valuation allowance	55,604			29,490
Valuation allowance	(33,021		)	—
Total deferred tax assets	$	22,583		$	29,490
Deferred tax liabilities:
Depreciation	$	9,857		$	8,026
Inventory	—			319
Pension	—			5,954
Intangible assets and goodwill	9,129			13,288
Convertible debt discount	5,644			6,833
Other, net	5,628			2,561
Total deferred tax liabilities	30,258			36,981
Net deferred tax liabilities	$	7,675		$	7,491

As of December 31, 2014, the Company has federal, state and foreign net operating losses ("NOLs") as follows:



	Amount		Expiration Period
Federal	$	81,328	2031 to 2034
State	84,596		2015 to 2034
Foreign	19,892		(a)

(a) Foreign NOLs of $1,719 expire in 2014 to 2018 and $18,173 do not expire.

The Company evaluates the recoverability of its deferred tax assets by assessing the adequacy of future taxable income from all sources, including the reversal of deferred tax liabilities, forecasted operating earnings and tax planning strategies. Valuation allowances are recorded against deferred tax assets when it is more likely than not that the amounts will not be realized.

The Company continued to generate losses at a number of its foreign subsidiaries in 2014. The larger than expected 2014 losses, when combined with prior losses, indicated that it was more likely than not that deferred tax assets of these foreign subsidiaries would not be realized. During 2014, a valuation allowance of $2,740 was recorded against all the pre-2014 deferred tax assets of these foreign subsidiaries. The deferred tax assets of these foreign subsidiaries are comprised primarily of net operating loss carry forwards. Additionally, losses generated by these foreign subsidiaries during the year ended December 31, 2014 were not benefited nor are future losses expected to be benefited until these subsidiaries return to profitability and evidence suggests that it is more likely than not that the deferred tax assets will be realized. The impact on the income tax provision of not benefiting the losses was approximately $2,148 for the year ended December 31, 2014.

In the U.S., the Company was in a net deferred tax asset position as of December 31, 2014, prior to the consideration of valuation allowances. The Company continued to generate losses in the U.S. These losses, combined with prior losses, indicated that it was more likely than not that the U.S. deferred tax assets would not be realized. Therefore, the Company recorded a valuation allowance and did not provide a tax benefit on a portion of the losses generated by the U.S. during the year ended December 31, 2014. The impact on the income tax provision of not benefiting the losses was approximately $28,133 for the year ended December 31, 2014. Continued operating losses in future periods and changes to the sources of income identified to utilize the U.S. deferred tax assets that differ significantly from current estimates may result in additional benefits not being recognized and a valuation allowance being recorded against some or all of the remaining U.S. deferred tax assets. The Company did not record valuation allowances against its U.S. deferred tax assets for the year ended December 31, 2013 as the U.S. had sufficient deferred tax liabilities to cover net operating losses.

Valuation allowances for the Company’s U.S. and non-U.S. operations were as follows December 31, 2014 and 2013:



	2014		2013		2012
U.S.
Balance, beginning of year	$	—	$	—	$	—
Provision charged to expense	19,684		—		—
Provision charged to accumulated other comprehensive loss	8,449		—		—
Balance, end of year	$	28,133	$	—	$	—
Non-U.S.
Balance, beginning of year	$	—	$	—	$	—
Provision charged to expense	4,888		—		—
Balance, end of year	$	4,888	$	—	$	—

Unrecognized tax benefits of $0, $105 and $105 would impact the effective tax rate if recognized as of December 31, 2014, 2013 and 2012, respectively. The accrued interest and penalties related to unrecognized tax benefits were insignificant at December 31, 2014 and 2013. The interest and penalties recorded by the Company were insignificant for the years ended December 31, 2014, 2013 and 2012.

During 2014, 2013 and 2012, statutes expired on certain unrecognized tax benefits of the Company. The reversal of the reserve of these unrecognized tax benefits was recorded as a component of overall income tax benefit for the years ended December 31, 2014, 2013 and 2012, respectively.

The Company or its subsidiaries files income tax returns in the United States federal jurisdiction, 33 states, and 7 foreign jurisdictions.

The following tax years remain open to examination by the major taxing jurisdictions to which the Company is subject:



U.S. Federal	2011 to 2014
U.S. States	2010 to 2014
Foreign	2008 to 2014

A 2011 and 2012 income tax audit of the Company's Canadian subsidiary was in process as of December 31, 2014. In February 2015, this audit was closed with no adjustment. During the second quarter of 2012, audits of the Company’s 2008 and 2009 U.S. federal income tax returns were concluded with no significant assessment. Changes to the Company's gross unrecognized tax benefits within the next twelve months, due to the potential for resolution of the examination or expiration of statutes of limitations, are immaterial.

The Company received its 2013 federal income tax refund of $1,500 during October 2014, its 2012 federal income tax refund of $2,590 during October 2013 and its 2010 federal income tax refund of $2,025 during February 2012.

(12) Commitments and Contingent Liabilities

As of December 31, ~~2013~~2014, the Company had ~~$6,701~~$5,842 of irrevocable letters of credit outstanding which primarily consisted of ~~$4,000~~$3,000 for collateral associated with commodity hedges and ~~$1,901~~$1,842 for compliance with the insurance reserve requirements of its workers’ compensation insurance carriers.

During the quarter ended March 31, 2013, the Company received warranty and other claims from certain customers regarding alleged quality defects with certain alloy round bar products sold by the Company in 2012 and 2013. The Company evaluated the information provided by the customers and issued a notice of potential defect to other affected customers. The Company ~~estimates that it may incur~~has incurred costs for warranty and other customer claims associated with ~~the~~these alleged quality defects ~~from $325~~of $1,150 to ~~$1,250. Based on the information available as of December 31, 2013, the Company's best estimate of the probable loss resulting from these claims is $1,150~~date, of which ~~approximately~~$90 and $1,060 iswere included as ~~a reduction~~reductions of net sales for the ~~year~~years ended December 31, ~~2013. Through~~2014 and December 31, 2013, ~~approximately $800 was paid or credited to customer accounts and $260 was accrued in current liabilities~~respectively. As of December 31, 2014, the Company is not aware of any remaining active claims for ~~future payments and credits.The~~compensation as a result of the alleged quality defects. The Company is pursuing claims against the original supplier of the products. ~~There~~While the Company does not currently expect further claims related to the alleged quality defects, there can be no assurance that additional claims will not arise or that the ~~Company's~~Company will not incur further losses related to such claims in the future.

(13) Segment Reporting

The Company distributes and performs processing on both metals and plastics. Although the distribution processes are similar, the customer markets, supplier bases and types of products are different. Additionally, the Company’s Chief Executive Officer, the chief operating decision-maker, reviews and manages these ~~claims will not exceed~~two businesses separately. As such, these businesses are considered reportable segments and are reported accordingly. Neither of the ~~Company's estimated range.~~Company’s reportable segments has any unusual working capital requirements.

6968

~~(14) Restructuring Charges~~saws, plate saws, oxygen and plasma arc flame cutting machinery, trepanning machinery, boring machinery, honing equipment, water-jet cutting, stress relieving and annealing furnaces, surface grinding equipment and sheet shearing equipment. This segment also performs various specialized fabrications for its customers through pre-qualified subcontractors that thermally process, turn, polish and straighten alloy and carbon bar.

~~As part~~The Company’s Plastics segment consists exclusively of a wholly-owned subsidiary that operates as Total Plastics, Inc. (“TPI”), headquartered in Kalamazoo, Michigan, and its wholly-owned subsidiaries. The Plastics segment stocks and distributes a wide variety of plastics in forms that include plate, rod, tube, clear sheet, tape, gaskets and fittings. Processing activities within this segment include cut-to-length, cut-to-shape, bending and forming according to customer specifications. The Plastics segment’s diverse customer base consists of companies in the retail (point-of-purchase), automotive, marine, office furniture and fixtures, safety products, life sciences applications, and general manufacturing industries. TPI has locations throughout the upper northeast and midwest regions of the ~~Company's efforts~~U.S. and one facility in Florida from which it services a wide variety of users of industrial plastics.

The accounting policies of all segments are the same as described in Note 1. Management evaluates the performance of its business segments based on operating income.

The Company operates primarily in North America. No activity from any individual country outside the United States is material, and therefore, foreign activity is reported on an aggregate basis. Net sales are attributed to ~~adapt operations to market conditions, restructuring activities related~~countries based on the location of the Company’s subsidiary that is selling direct to the ~~Company's organizational structure~~customer. Company-wide geographic data as of and ~~operations were announced during January~~for the years ended December 31, 2014, 2013 and 2012 are as follows:



	2014		2013		2012
Net sales
United States	$	736,236	$	817,714	$	988,161
All other countries	243,601		235,352		282,207
Total	$	979,837	$	1,053,066	$	1,270,368
Long-lived assets
United States	$	58,278	$	63,667	68,253
All other countries	14,557		13,027		11,387
Total	$	72,835	$	76,694	79,640

Segment information as of ~~2013. The charges associated with~~and for the ~~restructuring activities are primarily included in the Company's Metals segment. Charges included in the Company's Other segment, which~~years ended December 31, 2014, 2013 and 2012 is as follows:



	Net Sales		Operating (Loss) Income			Total Assets		Capital Expenditures		Depreciation & Amortization
2014
Metals segment	$	841,672	$	(94,708	)	$	489,563	$	11,184	$	24,380
Plastics segment	138,165		6,354			60,970		1,167		1,664
Other ^(a)	—		(10,520		)	37,443		—		—
Consolidated	$	979,837	$	(98,874	)	$	587,976	$	12,351	$	26,044
2013
Metals segment	$	918,298	$	(11,571	)	$	580,570	$	10,181	$	24,579
Plastics segment	134,768		4,278			57,373		1,423		1,609
Other ^(a)	—		(8,379		)	41,879		—		—
Consolidated	$	1,053,066	$	(15,672	)	$	679,822	$	11,604	$	26,188
2012
Metals segment	$	1,143,884	$	48,473		$	693,803	$	9,819	$	24,480
Plastics segment	126,484		3,188			56,149		1,831		1,387
Other^(a)	—		(11,865		)	38,854		—		—
Consolidated	$	1,270,368	$	39,796		$	788,806	$	11,650	$	25,867

^(a) “Other” – Operating loss includes the costs of ~~the~~ executive, legal and elements of the finance ~~departments~~department, which are shared by both the Metals and Plastics ~~segments, are insignificant.~~

segments. The charges incurred during the year ended December 31, 2013 for the restructuring announced in January 2013 were comprised of employee termination and related benefits associated with salaried and hourly workforce reductions, lease termination costs, moving costs, other exit costs associated with five plant consolidations and inventory write-offs. For the year ended December 31, 2013, the Company incurred $9,798 of charges related to the restructuring announced in January of 2013. The restructuring activities announced in January 2013 are complete and any additional charges related to these restructuring activities will be insignificant.

In October 2013, the Company announced the consolidation of four additional facilities in locations where it has redundant operations as part of its continuous improvement plans to lower structural operating costs. For the year ended December 31, 2013, the Company incurred $441 of charges for moving and relocation costs associated with the consolidation of one“Other” category’s total assets consist of the ~~four additional facility consolidations. The Company expects to incur $2,400~~Company’s investment in total charges for moving and relocation costs to consolidate the four facilities. Additional charges to consolidate the facilities will be incurred during fiscal 2014 as the consolidation plans are executed.

~~Below is a summary of the total cumulative restructuring charges incurred during the year ended December 31, 2013:~~

Charges incurred during the
Year ended
December 31, 2013
Employee termination and related benefits $ 2,702
Lease termination costs 1,448
Moving costs associated with plant consolidations 4,487
Other exit costs 366
Inventory write-offs 1,236
Total $ 10,239
joint venture.

7069

~~Restructuring activity by plan for~~Below are reconciliations of segment data to the ~~year ended December 31, 2013~~ ~~is summarized below:~~

consolidated loss before income taxes:

Period Activity
Balance January 1, 2013
Charges ^(a)
Cash payments Impairment
Balance December 31, 2013 ^(b)
Cumulative Charges Incurred to Date Total Charges Expected to be Incurred
October 2013 plant consolidations
Moving costs associated with plant consolidations $ —
$ 312
$ (312 ) $ —
$ —
$ 312
$ 2,270
Employee termination and related benefits —
129
—
—
129
129
130
Total October 2013 plant consolidations —
441
(312 ) —
129
441
2,400
January 2013 restructuring activity
Moving costs associated with plant consolidations —
4,175
(4,006 ) (169 ) —
4,175
3,500
Employee termination and related benefits —
2,573
(2,573 ) —
—
2,573
2,200
Lease termination costs —
1,448
(527 ) —
921
1,448
1,800
Other exit costs —
366
(366 ) —
—
366
1,250
Inventory write-offs —
1,236
—
(1,236 ) —
1,236
1,250
Total January 2013 restructuring activity —
9,798
(7,472 ) (1,405 ) 921
9,798
10,000
Total restructuring activity $ —
$ 10,239
$ (7,784 ) $ (1,405 ) $ 1,050
$ 10,239
$ 12,400



	2014			2013			2012
Operating (loss) income	$	(98,874	)	$	(15,672	)	$	39,796
Interest expense, net	(40,548		)	(40,542		)	(41,090		)
Interest expense - unrealized loss on debt conversion option	—			—			(15,597		)
Loss on extinguishment of debt	—			(2,606		)	—
Other (expense) income	(4,323		)	(1,924		)	1,349
Loss before income taxes and equity in earnings of joint venture	(143,745		)	(60,744		)	(15,542		)
Equity in earnings of joint venture	7,691			6,987			7,224
Consolidated loss before income taxes	$	(136,054	)	$	(53,757	)	$	(8,318	)

(14) Guarantor Financial Information

^(a)~~Costs associated with the write-off of inventory~~The Company's Senior Secured Notes are included in cost of materials in the consolidated statements of operations and comprehensive loss. All other costs are recorded to the restructuring charges line item within the consolidated statements of operations and comprehensive loss as they are incurred.

^(b)~~Payments on~~guaranteed by certain 100% directly owned subsidiaries of the lease obligations are scheduled to continue until 2016. Market conditions and the Company’s ability to sublease these properties could affect the ultimate charge related to the lease obligations. Any potential recoveries or additional charges could affect amounts reported in the consolidated financial statements of future periods.Company (the "Guarantors"). As of December 31, ~~2013,~~2014, the ~~short-term portion~~Guarantors included Total Plastics, Inc., Advanced Fabricating Technology, LLC, Keystone Tube Company, LLC and Paramount Machine Company, LLC, each of which fully and unconditionally guarantee the ~~restructuring liability of $595 is included in accrued liabilities~~Senior Secured Notes on a joint and ~~the long-term portion of $455 is included in other non-current liabilities in the Consolidated Balance Sheet.~~

~~(15) Guarantor Financial Information~~several basis.

The accompanying ~~consolidating~~ financial ~~information has~~statements have been prepared and presented pursuant to Rule 3-10 of SEC Regulation S-X “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered.” The financial statements present condensed consolidating financial information ~~presents~~for A. M. Castle & Co. ~~(Parent)~~(the "Parent"), the Guarantors, the non-guarantor subsidiaries (all other subsidiaries) and ~~subsidiaries.~~an elimination column for adjustments to arrive at the information for the Parent, Guarantors, and non-guarantors on a consolidated basis. The condensed consolidating financial information has been prepared on the same basis as the consolidated statements of the Parent. The equity method of accounting is followed within this financial information.

In September 2013, the Company merged Transtar Metals Corp. and Oliver Steel Plate Co., guarantors, with the Parent. In addition, certain non-guarantor subsidiaries were merged with the parent in September 2013. In September 2012, the Company merged Tube Supply, LLC, a guarantor, with the Parent. The Company has reflected these changes in its accompanying condensed consolidating financial statements of guarantors and non-guarantors.

Condensed Consolidating Balance Sheet As of December 31, 2014

	Parent		Guarantors		Non-Guarantors			Eliminations			Consolidated
Assets
Current assets
Cash and cash equivalents	$	511	$	977	$	6,966		$	—		$	8,454
Accounts receivable, less allowance for doubtful accounts	66,178		19,303		45,522			—			131,003
Receivables from affiliates	2,071		81		—			(2,152		)	—
Inventories	142,314		19,320		75,366			(68		)	236,932
Prepaid expenses and other current assets	3,490		1,033		8,506			—			13,029
Total current assets	214,564		40,714		136,360			(2,220		)	389,418
Investment in joint venture	37,443		—		—			—			37,443
Goodwill	—		12,973		—			—			12,973
Intangible assets, net	42,772		—		13,783			—			56,555
Other assets	18,766		—		996			(1,010		)	18,752
Investment in subsidiaries	70,274		—		—			(70,274		)	—
Receivables from affiliates	113,188		36,607		2,157			(151,952		)	—
Property, plant and equipment, net	46,094		12,184		14,557			—			72,835
Total assets	$	543,101	$	102,478	$	167,853		$	(225,456	)	$	587,976
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	41,613	$	8,055	$	19,114		$	—		$	68,782
Payables due to affiliates	2,071		—		81			(2,152		)	—
Other current liabilities	18,841		3,065		6,092			—			27,998
Current portion of long-term debt	691		—		46			—			737
Total current liabilities	63,216		11,120		25,333			(2,152		)	97,517
Long-term debt, less current portion	307,327		—		2,050			—			309,377
Payables due to affiliates	—		5,581		146,371			(151,952		)	—
Deferred income taxes	—		5,524		3,846			(1,010		)	8,360
Other non-current liabilities	22,238		—		164			—			22,402
Stockholders’ equity (deficit)	150,320		80,253		(9,911		)	(70,342		)	150,320
Total liabilities and stockholders’ equity	$	543,101	$	102,478	$	167,853		$	(225,456	)	$	587,976

Condensed Consolidating Balance Sheet As of December 31, 2013	Condensed Consolidating Balance Sheet As of December 31, 2013												Condensed Consolidating Balance Sheet As of December 31, 2013

	Parent		Guarantors		Non-Guarantors			Eliminations			Consolidated		Parent		Guarantors		Non-Guarantors			Eliminations			Consolidated
Assets
Current assets
Cash and cash equivalents	$	8,675	$	495	$	21,659		$	—		$	30,829	$	8,675	$	495	$	21,659		$	—		$	30,829
Accounts receivable, less allowance for doubtful accounts	67,536		18,305		42,703			—			128,544		67,536		18,305		42,703			—			128,544
Receivables from affiliates	2,811		—		—			(2,811		)	—		2,811		—		—			(2,811		)	—
Inventories	133,139		16,357		65,472			(68		)	214,900		133,139		16,357		65,472			(68		)	214,900
Prepaid expenses and other current assets	8,383		2,244		5,993			(202		)	16,418		8,383		2,244		5,993			(202		)	16,418
Total current assets	220,544		37,401		135,827			(3,081		)	390,691		220,544		37,401		135,827			(3,081		)	390,691
Investment in joint venture	41,879		—		—			—			41,879		41,879		—		—			—			41,879
Goodwill	41,504		12,973		14,812			—			69,289		41,504		12,973		14,812			—			69,289
Intangible assets	52,703		—		16,786			—			69,489
Intangible assets, net													52,703		—		16,786			—			69,489
Other assets	28,145		—		3,635			—			31,780		28,145		—		3,635			—			31,780
Investment in subsidiaries	119,075		—		—			(119,075		)	—		119,075		—		—			(119,075		)	—
Receivables from affiliates	87,247		34,637		1,465			(123,349		)	—		87,247		34,637		1,465			(123,349		)	—
Property, plant and equipment, net	50,812		12,855		13,027			—			76,694		50,812		12,855		13,027			—			76,694
Total assets	$	641,909	$	97,866	$	185,552		$	(245,505	)	$	679,822	$	641,909	$	97,866	$	185,552		$	(245,505	)	$	679,822
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	41,233	$	8,274	$	20,070		$	—		$	69,577	$	41,233	$	8,274	$	20,070		$	—		$	69,577
Payables due to affiliates	2,270		—		541			(2,811		)	—		2,270		—		541			(2,811		)	—
Other current liabilities	22,801		944		7,622			—			31,367		22,801		944		7,622			—			31,367
Current portion of long-term debt and short-term debt	371		—		26			—			397
Current portion of long-term debt													371		—		26			—			397
Total current liabilities	66,675		9,218		28,259			(2,811		)	101,341		66,675		9,218		28,259			(2,811		)	101,341
Long-term debt, less current portion	245,561		—		38			—			245,599		245,561		—		38			—			245,599
Payables due to affiliates	—		6,579		116,770			(123,349		)	—		—		6,579		116,770			(123,349		)	—
Deferred income taxes	7,823		7,061		(4,151		)	—			10,733		7,823		7,061		(4,151		)	—			10,733
Other non-current liabilities	11,956		—		299			—			12,255		11,956		—		299			—			12,255
Stockholders’ equity	309,894		75,008		44,337			(119,345		)	309,894		309,894		75,008		44,337			(119,345		)	309,894
Total liabilities and stockholders’ equity	$	641,909	$	97,866	$	185,552		$	(245,505	)	$	679,822	$	641,909	$	97,866	$	185,552		$	(245,505	)	$	679,822

Condensed Consolidating Balance Sheet
As of December 31, 2012

Parent Guarantors Non-Guarantors Eliminations Consolidated
Assets
Current assets
Cash and cash equivalents $ 4,106
$ 903
$ 16,598
$ —
$ 21,607
Accounts receivable, less allowance for doubtful accounts 77,160
17,170
43,981
—
138,311
Receivables from affiliates 1,213
—
668
(1,881 ) —
Inventories 211,450
16,613
75,777
(68 ) 303,772
Prepaid expenses and other current assets 16,587
(1,648 ) 7,951
(202 ) 22,688
Total current assets 310,516
33,038
144,975
(2,151 ) 486,378
Investment in joint venture 38,854
—
—
—
38,854
Goodwill 41,504
12,973
15,823
—
70,300
Intangible assets 62,668
—
19,809
—
82,477
Other assets 26,824
(2 ) 4,335
—
31,157
Investment in subsidiaries 130,257
—
—
(130,257 ) —
Receivables from affiliates 85,351
32,177
3,283
(120,811 ) —
Property, plant and equipment, net 54,701
13,552
11,387
—
79,640
Total assets $ 750,675
$ 91,738
$ 199,612
$ (253,219 ) $ 788,806
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable $ 45,456
$ 8,488
$ 14,046
$ —
$ 67,990
Payables due to affiliates 838
—
1,044
(1,882 ) —
Other current liabilities 30,902
(855 ) 8,080
—
38,127
Current portion of long-term debt and short-term debt 387
—
528
—
915
Total current liabilities 77,583
7,633
23,698
(1,882 ) 107,032
Long-term debt, less current portion 292,086
—
4,068
—
296,154
Payables due to affiliates —
8,381
112,430
(120,811 ) —
Deferred income taxes 28,052
4,771
(473 ) —
32,350
Other non-current liabilities 15,614
—
316
—
15,930
Stockholders’ equity 337,340
70,953
59,573
(130,526 ) 337,340
Total liabilities and stockholders’ equity $ 750,675
$ 91,738
$ 199,612
$ (253,219 ) $ 788,806

Condensed Consolidating Statement of Operations and Comprehensive (Loss) Income For the year ended December 31, 2014

	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net Sales	$	609,507		$	138,165		$	243,658		$	(11,493	)	$	979,837
Costs, expenses and (gains):
Cost of materials (exclusive of depreciation and amortization)	460,104			97,981			199,851			(11,493		)	746,443
Warehouse, processing and delivery expense	101,473			11,772			27,314			—			140,559
Sales, general and administrative expense	71,659			18,303			22,503			—			112,465
Restructuring activity, net	(3,184		)	—			224			—			(2,960		)
Depreciation and amortization expense	19,592			2,201			4,251			—			26,044
Impairment of goodwill	41,308			—			14,852			—			56,160
Operating (loss) income	(81,445		)	7,908			(25,337		)	—			(98,874		)
Interest expense, net	(25,658		)	—			(14,890		)	—			(40,548		)
Loss on extinguishment of debt	—			—			—			—			—
Other expense, net	—			—			(4,323		)	—			(4,323		)
(Loss) income before income taxes and equity in earnings of subsidiaries and joint venture	(107,103		)	7,908			(44,550		)	—			(143,745		)
Income taxes	8,134			(2,663		)	(4,323		)	205			1,353
Equity in losses of subsidiaries	(43,422		)	—			—			43,422			—
Equity in earnings of joint venture	7,691			—			—			—			7,691
Net (loss) income	(134,700		)	5,245			(48,873		)	43,627			(134,701		)

Comprehensive (loss) income:
Foreign currency translation adjustments	(5,377		)	—			(5,377		)	5,377			(5,377		)
Change in unrecognized pension and postretirement benefit costs, net of tax	(21,445		)	—			—			—			(21,445		)
Other comprehensive (loss) income	(26,822		)	—			(5,377		)	5,377			(26,822		)
Net (loss) income	(134,700		)	5,245			(48,873		)	43,627			(134,701		)
Comprehensive (loss) income	$	(161,522	)	$	5,245		$	(54,250	)	$	49,004		$	(161,523	)

Condensed Consolidating Statement of Operations and Comprehensive (Loss) Income For the year ended December 31, 2013
Condensed Consolidating Statement of Operations Comprehensive (Loss) Income For the year ended December 31, 2013																Condensed Consolidating Statement of Operations Comprehensive (Loss) Income For the year ended December 31, 2013

	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated			Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net Sales	$	711,942		$	134,768		$	236,714		$	(30,358	)	$	1,053,066		$	711,942		$	134,768		$	236,714		$	(30,358	)	$	1,053,066
Costs and expenses:
Cost of materials (exclusive of depreciation and amortization)	528,008			95,953			185,605			(30,358		)	779,208			528,008			95,953			185,605			(30,358		)	779,208
Warehouse, processing and delivery expense	104,897			12,104			23,933			—			140,934			104,897			12,104			23,933			—			140,934
Sales, general and administrative expense	72,060			18,195			23,150			—			113,405			72,060			18,195			23,150			—			113,405
Restructuring charges	7,006			—			1,997			—			9,003
Restructuring activity, net																7,006			—			1,997			—			9,003
Depreciation and amortization expense	19,977			2,154			4,057			—			26,188			19,977			2,154			4,057			—			26,188
Operating (loss) income	(20,006		)	6,362			(2,028		)	—			(15,672		)	(20,006		)	6,362			(2,028		)	—			(15,672		)
Interest expense, net	(25,760		)	—			(14,782		)	—			(40,542		)	(25,760		)	—			(14,782		)	—			(40,542		)
Loss on extinguishment of debt	(2,606		)	—			—			—			(2,606		)	(2,606		)	—			—			—			(2,606		)
Other expense	—			—			(1,924		)	—			(1,924		)
Other expense, net																—			—			(1,924		)	—			(1,924		)
(Loss) income before income taxes and equity in earnings of subsidiaries and joint venture	(48,372		)	6,362			(18,734		)	—			(60,744		)	(48,372		)	6,362			(18,734		)	—			(60,744		)
Income taxes	16,361			(2,349		)	5,783			—			19,795			16,361			(2,349		)	5,783			—			19,795
Equity in losses of subsidiaries	(8,938		)	—			—			8,938			—			(8,938		)	—			—			8,938			—
Equity in earnings of joint venture	6,987			��			—			—			6,987			6,987			—			—			—			6,987
Net (loss) income	(33,962		)	4,013			(12,951		)	8,938			(33,962		)	(33,962		)	4,013			(12,951		)	8,938			(33,962		)

Comprehensive (loss) income:
Foreign currency translation (losses) gains	(2,295		)	—			(2,295		)	2,295			(2,295		)
Unrecognized pension and postretirement benefit credits, net of tax	4,623			—			—			—			4,623
Foreign currency translation adjustments																(2,295		)	—			(2,295		)	2,295			(2,295		)
Change in unrecognized pension and postretirement benefit costs, net of tax																4,623			—			—			—			4,623
Other comprehensive income (loss)	2,328			—			(2,295		)	2,295			2,328			2,328			—			(2,295		)	2,295			2,328
Net (loss) income	(33,962		)	4,013			(12,951		)	8,938			(33,962		)	(33,962		)	4,013			(12,951		)	8,938			(33,962		)
Comprehensive (loss) income	$	(31,634	)	$	4,013		$	(15,246	)	$	11,233		$	(31,634	)	$	(31,634	)	$	4,013		$	(15,246	)	$	11,233		$	(31,634	)

Condensed Consolidating Statement of Operations Comprehensive (Loss) Income For the year ended December 31, 2012	Condensed Consolidating Statement of Operations Comprehensive (Loss) Income For the year ended December 31, 2012															Condensed Consolidating Statement of Operations Comprehensive (Loss) Income For the year ended December 31, 2012

	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated			Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Net Sales	$	898,324		$	126,484		$	282,275		$	(36,715	)	$	1,270,368		$	898,324		$	126,484		$	282,275		$	(36,715	)	$	1,270,368
Costs and expenses:
Cost of materials (exclusive of depreciation and amortization)	655,203			90,983			217,749			(36,648		)	927,287			655,203			90,983			217,749			(36,648		)	927,287
Warehouse, processing and delivery expense	112,745			11,342			24,169			—			148,256			112,745			11,342			24,169			—			148,256
Sales, general and administrative expense	89,372			16,788			23,002			—			129,162			89,372			16,788			23,002			—			129,162
Depreciation and amortization expense	19,833			2,042			3,992			—			25,867			19,833			2,042			3,992			—			25,867
Operating income (loss)	21,171			5,329			13,363			(67		)	39,796			21,171			5,329			13,363			(67		)	39,796
Interest (expense) income, net	(27,801		)	21			(13,310		)	—			(41,090		)	(27,801		)	21			(13,310		)	—			(41,090		)
Interest expense - unrealized loss on debt conversion option	(15,597		)	—			—			—			(15,597		)	(15,597		)	—			—			—			(15,597		)
Other income	—			—			1,349			—			1,349
Other income, net																—			—			1,349			—			1,349
(Loss) income before income taxes and equity in earnings of subsidiaries and joint venture	(22,227		)	5,350			1,402			(67		)	(15,542		)	(22,227		)	5,350			1,402			(67		)	(15,542		)
Income taxes	1,272			(1,996		)	(503		)	(203		)	(1,430		)	1,272			(1,996		)	(503		)	(203		)	(1,430		)
Equity in earnings of subsidiaries	3,983			—			—			(3,983		)	—			3,983			—			—			(3,983		)	—
Equity in earnings of joint venture	7,224			—			—			—			7,224			7,224			—			—			—			7,224
Net (loss) income	(9,748		)	3,354			899			(4,253		)	(9,748		)	(9,748		)	3,354			899			(4,253		)	(9,748		)

Comprehensive (loss) income:
Foreign currency translation gains (losses)	2,369			—			2,369			(2,369		)	2,369
Unrecognized pension and postretirement benefit costs, net of tax	(3,616		)	—			—			—			(3,616		)
Foreign currency translation adjustments																2,369			—			2,369			(2,369		)	2,369
Change in unrecognized pension and postretirement benefit costs, net of tax																(3,616		)	—			—			—			(3,616		)
Other comprehensive (loss) income	(1,247		)	—			2,369			(2,369		)	(1,247		)	(1,247		)	—			2,369			(2,369		)	(1,247		)
Net (loss) income	(9,748		)	3,354			899			(4,253		)	(9,748		)	(9,748		)	3,354			899			(4,253		)	(9,748		)
Comprehensive (loss) income	$	(10,995	)	$	3,354		$	3,268		$	(6,622	)	$	(10,995	)	$	(10,995	)	$	3,354		$	3,268		$	(6,622	)	$	(10,995	)

Condensed Consolidating Statement of Operations Comprehensive (Loss) Income
For the year ended December 31, 2011

Parent Guarantors Non-Guarantors Eliminations Consolidated
Net Sales $ 784,414
$ 118,236
$ 237,201
$ (7,485 ) $ 1,132,366
Costs and expenses:
Cost of materials (exclusive of depreciation and amortization) 589,040
82,686
181,104
(7,221 ) 845,609
Warehouse, processing and delivery expense 102,953
11,418
20,527
—
134,898
Sales, general and administrative expense 88,664
17,381
19,481
—
125,526
Depreciation and amortization expense 15,813
2,001
2,658
—
20,472
Operating income (loss) (12,056 ) 4,750
13,431
(264 ) 5,861
Interest expense, net (5,719 ) —
(3,944 ) —
(9,663 )
Interest expense - unrealized loss on debt conversion option (3,991 ) —
—
—
(3,991 )
Loss on extinguishment of debt (6,153 ) —
—
—
(6,153 )
Other expense —
—
(667 ) —
(667 )
(Loss) income before income taxes and equity in earnings of subsidiaries and joint venture (27,919 ) 4,750
8,820
(264 ) (14,613 )
Income taxes 4,647
(1,598 ) (1,923 ) —
1,126
Equity in earnings of subsidiaries 9,785
—
—
(9,785 ) —
Equity in earnings of joint venture 11,727
—
—
—
11,727
Net (loss) income (1,760 ) 3,152
6,897
(10,049 ) (1,760 )

Comprehensive (loss) income:
Foreign currency translation (losses) gains (941 ) —
(941 ) 941
(941 )
Unrecognized pension and postretirement benefit costs, net of tax (3,071 ) —
—
—
(3,071 )
Other comprehensive (loss) income (4,012 ) —
(941 ) 941
(4,012 )
Net (loss) income (1,760 ) 3,152
6,897
(10,049 ) (1,760 )
Comprehensive (loss) income $ (5,772 ) $ 3,152
$ 5,956
$ (9,108 ) $ (5,772 )

Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2014

	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Operating activities:
Net (loss) income	$	(134,700	)	$	5,245		$	(48,873	)	$	43,627		$	(134,701	)
Equity in losses of subsidiaries	43,422			—			—			(43,422		)	—
Adjustments to reconcile net (loss) income to cash (used in) from operating activities	50,994			(265		)	9,100			(205		)	59,624
Net cash (used in) from operating activities	(40,284		)	4,980			(39,773		)	—			(75,077		)
Investing activities:
Capital expenditures	(5,642		)	(1,530		)	(5,179		)	—			(12,351		)
Proceeds from sale of property, plant and equipment	7,464			—			—			—			7,464
Net advances to subsidiaries	(25,941		)	—			—			25,941			—
Net cash (used in) from investing activities	(24,119		)	(1,530		)	(5,179		)	25,941			(4,887		)
Financing activities:
Proceeds from long-term debt	459,406			—			2,998			—			462,404
Repayments of long-term debt	(402,774		)	—			(1,037		)	—			(403,811		)
Net intercompany (repayments) borrowings	—			(2,968		)	28,909			(25,941		)	—
Other financing activities, net	(393		)	—			—			—			(393		)
Net cash from (used in) financing activities	56,239			(2,968		)	30,870			(25,941		)	58,200
Effect of exchange rate changes on cash and cash equivalents	—			—			(611		)	—			(611		)
Net change in cash and cash equivalents	(8,164		)	482			(14,693		)	—			(22,375		)
Cash and cash equivalents - beginning of year	8,675			495			21,659			—			30,829
Cash and cash equivalents - end of year	$	511		$	977		$	6,966		$	—		$	8,454

Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2013	Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2013															Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2013

	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated			Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Operating activities:
Net (loss) income	$	(33,962	)	$	4,013		$	(12,951	)	$	8,938		$	(33,962	)	$	(33,962	)	$	4,013		$	(12,951	)	$	8,938		$	(33,962	)
Equity in losses of subsidiaries	8,938			—			—			(8,938		)	—			8,938			—			—			(8,938		)	—
Adjustments to reconcile net (loss) income to cash from operating activities	86,665			1,298			20,384			—			108,347			86,665			1,298			20,384			—			108,347
Net cash from operating activities	61,641			5,311			7,433			—			74,385			61,641			5,311			7,433			—			74,385
Investing activities:
Capital expenditures	(6,700		)	(1,466		)	(3,438		)	—			(11,604		)	(6,700		)	(1,466		)	(3,438		)	—			(11,604		)
Other investing activities, net	778			9			7			—			794
Proceeds from sale of property, plant and equipment																778			9			7			—			794
Net cash used in investing activities	(5,922		)	(1,457		)	(3,431		)	—			(10,810		)	(5,922		)	(1,457		)	(3,431		)	—			(10,810		)
Financing activities:
Proceeds from long-term debt, including new revolving credit facility	115,300			—			—			—			115,300
Repayments of long-term debt, including new revolving credit facility	(166,190		)	—			(4,155		)	—			(170,345		)
Proceeds from long-term debt																115,300			—			—			—			115,300
Repayments of long-term debt																(166,190		)	—			(4,155		)	—			(170,345		)
Net intercompany (repayments) borrowings	(1,896		)	(4,262		)	6,158			—			—			(1,896		)	(4,262		)	6,158			—			—
Other financing activities, net	1,636			—			(496		)	—			1,140			1,636			—			(496		)	—			1,140
Net cash (used in) from financing activities	(51,150		)	(4,262		)	1,507			—			(53,905		)	(51,150		)	(4,262		)	1,507			—			(53,905		)
Effect of exchange rate changes on cash and cash equivalents	—			—			(448		)	—			(448		)	—			—			(448		)	—			(448		)
Increase (decrease) in cash and cash equivalents	4,569			(408		)	5,061			—			9,222
Net change in cash and cash equivalents																4,569			(408		)	5,061			—			9,222
Cash and cash equivalents - beginning of year	4,106			903			16,598			—			21,607			4,106			903			16,598			—			21,607
Cash and cash equivalents - end of year	$	8,675		$	495		$	21,659		$	—		$	30,829		$	8,675		$	495		$	21,659		$	—		$	30,829

Condensed Consolidating Statement of Cash Flows
For the year ended December 31, 2012

Parent Guarantors Non-Guarantors Eliminations Consolidated
Operating activities:
Net (loss) income $ (9,748 ) $ 3,354
$ 899
$ (4,253 ) $ (9,748 )
Equity in earnings of subsidiaries (3,983 ) —
—
3,983
—
Adjustments to reconcile net (loss) income to cash from (used in) operating activities 22,233
2,208
(9,612 ) 270
15,099
Net cash from (used in) operating activities 8,502
5,562
(8,713 ) —
5,351
Investing activities:
Acquisition/Investment of businesses, net of cash acquired (6,472 ) —
—
—
(6,472 )
Capital expenditures (6,374 ) (1,862 ) (2,885 ) —
(11,121 )
Other investing activities, net 150
—
3
—
153
Net cash used in investing activities (12,696 ) (1,862 ) (2,882 ) —
(17,440 )
Financing activities:
Proceeds from long-term debt, including new revolving credit facility 756,550
—
10,540
—
767,090
Repayments of long-term debt, including new revolving credit facility (745,838 ) —
(17,049 ) —
(762,887 )
Payment of debt issue costs (1,503 ) —
—
—
(1,503 )
Net intercompany (repayments) borrowings (13,255 ) (2,804 ) 16,059
—
—
Other financing activities, net 236
—
(27 ) —
209
Net cash from (used in) financing activities (3,810 ) (2,804 ) 9,523
—
2,909
Effect of exchange rate changes on cash and cash equivalents —
—
263
—
263
(Decrease) increase in cash and cash equivalents (8,004 ) 896
(1,809 ) —
(8,917 )
Cash and cash equivalents - beginning of year 12,110
7
18,407
—
30,524
Cash and cash equivalents - end of year $ 4,106
$ 903
$ 16,598
$ —
$ 21,607

Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2011
Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2012																Condensed Consolidating Statement of Cash Flows For the year ended December 31, 2012

	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated			Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Operating activities:
Net (loss) income	$	(1,760	)	$	3,152		$	6,897		$	(10,049	)	$	(1,760	)	$	(9,748	)	$	3,354		$	899		$	(4,253	)	$	(9,748	)
Equity in earnings of subsidiaries	(9,785		)	—			—			9,785			—			(3,983		)	—			—			3,983			—
Adjustments to reconcile net (loss) income to cash (used in) from operating activities	31,357			(6,096		)	(70,053		)	264			(44,528		)
Net cash (used in) from operating activities	19,812			(2,944		)	(63,156		)	—			(46,288		)
Adjustments to reconcile net (loss) income to cash from (used in) operating activities																22,233			2,208			(9,612		)	270			15,099
Net cash from (used in) operating activities																8,502			5,562			(8,713		)	—			5,351
Investing activities:
Acquisition/Investment of businesses, net of cash acquired	(175,836		)	—			1,592			—			(174,244		)	(6,472		)	—			—			—			(6,472		)
Capital expenditures	(6,248		)	(2,357		)	(3,139		)	—			(11,744		)	(6,374		)	(1,862		)	(2,885		)	—			(11,121		)
Other investing activities, net	738			3			58			—			799
Proceeds from sale of property, plant and equipment																150			—			3			—			153
Net cash used in investing activities	(181,346		)	(2,354		)	(1,489		)	—			(185,189		)	(12,696		)	(1,862		)	(2,882		)	—			(17,440		)
Financing activities:
Net (repayments) borrowings of debt	90			—			(25,840		)	—			(25,750		)
Proceeds from long-term debt, including new revolving credit facility	309,625			—			10,851			—			320,476
Repayments of long-term debt, including new revolving credit facility	(52,951		)	—			(261		)	—			(53,212		)
Payment of debt issue costs	(16,380		)	—			(253		)	—			(16,633		)
Net intercompany borrowings (repayments)	(75,783		)	4,994			70,789			—			—
Proceeds from long-term debt																756,550			—			10,540			—			767,090
Repayments of long-term debt																(745,838		)	—			(17,049		)	—			(762,887		)
Net intercompany (repayments) borrowings																(13,255		)	(2,804		)	16,059			—			—
Other financing activities, net	657			—			—			—			657			(1,267		)	—			(27		)	—			(1,294		)
Net cash from financing activities	165,258			4,994			55,286			—			225,538
Net cash from (used in) financing activities																(3,810		)	(2,804		)	9,523			—			2,909
Effect of exchange rate changes on cash and cash equivalents	—			—			(253		)	—			(253		)	—			—			263			—			263
(Decrease) increase in cash and cash equivalents	3,724			(304		)	(9,612		)	—			(6,192		)
Net change in cash and cash equivalents																(8,004		)	896			(1,809		)	—			(8,917		)
Cash and cash equivalents - beginning of year	8,386			311			28,019			—			36,716			12,110			7			18,407			—			30,524
Cash and cash equivalents - end of year	$	12,110		$	7		$	18,407		$	—		$	30,524		$	4,106		$	903		$	16,598		$	—		$	21,607

7978

~~(16)~~(15) Selected Quarterly Data (Unaudited)


	First Quarter			Second Quarter			Third Quarter			Fourth Quarter			First Quarter			Second Quarter			Third Quarter			Fourth Quarter
2013
2014
Net sales	$	292,714		$	273,410		$	253,713		$	233,229		$	253,410		$	249,492		$	245,469		$	231,466
Gross profit ^(a)	31,128			29,496			25,747			20,365			23,041			14,647			20,213			8,890
Net loss ^(c)(b)	(10,622		)	(3,799		)	(6,911		)	(12,630		)	(15,998		)	(72,298		)	(7,325		)	(39,080		)
Basic loss per share	$	(0.46	)	$	(0.16	)	$	(0.30	)	$	(0.54	)	$	(0.69	)	$	(3.10	)	$	(0.31	)	$	(1.62	)
Diluted loss per share	$	(0.46	)	$	(0.16	)	$	(0.30	)	$	(0.54	)	$	(0.69	)	$	(3.10	)	$	(0.31	)	$	(1.62	)
Common stock dividends declared	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—
2012
2013
Net sales	$	362,916		$	329,392		$	304,039		$	274,021		$	292,714		$	273,410		$	253,713		$	233,229
Gross profit ^(a)	53,810			43,763			42,867			28,518			31,128			29,496			25,747			20,365
Net (loss) income ^(b)	(4,300		)	(2,978		)	3,173			(5,643		)
Basic (loss) earnings per share	$	(0.19	)	$	(0.13	)	$	0.14		$	(0.24	)
Diluted (loss) earnings per share	$	(0.19	)	$	(0.13	)	$	0.13		$	(0.24	)
Net loss ^(b)													(10,622		)	(3,799		)	(6,911		)	(12,630		)
Basic loss per share													$	(0.46	)	$	(0.16	)	$	(0.30	)	$	(0.54	)
Diluted loss per share													$	(0.46	)	$	(0.16	)	$	(0.30	)	$	(0.54	)
Common stock dividends declared	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—

^(a) Gross profit equals net sales ~~minus~~less cost of materials, warehouse, processing, and delivery costs and ~~less~~ depreciation and amortization expense.

^(b) ~~First~~Results include restructuring activity for all quarters presented and a $56,160 goodwill impairment charge for second quarter ~~results include a mark-to-market adjustment related to the conversion option associated with the convertible debt in the amount~~ of ~~$11,340~~ ~~and~~ ~~$4,257, respectively. Amounts were included in interest expense during the respective quarters.~~

^(c) ~~First, second, third and fourth quarter results include restructuring charges of~~ ~~$2,982~~, ~~$6,072~~, ~~$885~~ ~~and $300, respectively. Amounts were included in restructuring charges and cost of materials during the respective quarters.~~

~~(17) Subsequent Events~~

On January 21, 2014, the Company entered into Amendment No. 1 to Loan and Security Agreement (the "Amendment"), by and among the Company, certain subsidiaries of the Company, the financial institutions from time to time party to the Loan Agreement as lenders and Wells Fargo Bank, National Association, in its capacity as agent (the "Agent"). As previously disclosed, the Company, certain subsidiaries of the Company as Borrowers and Guarantors, the financial institutions from time to time party thereto as lenders, and the Agent entered into the Loan and Security Agreement as of December 15, 2011. The terms of the Loan Agreement permit the Company to request an increase of the original ~~$100,000~~ ~~revolving commitment to an aggregate amount of up to~~ ~~$50,000~~ (the "Accordion"). Under the Amendment, the Company partially exercised the Accordion to increase the aggregate commitments under its revolving credit facility by $25,000. As a result of the Company's partial exercise, borrowing capacity under the Loan Agreement increased from ~~$100,000~~ to $125,000, subject to borrowing base. The Company remains entitled to request a further increase under the Accordion by an aggregate amount not greater than $25,000. All other terms of the Loan Agreement remain unchanged.2014.

8079

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of A.M. Castle & Co.

Oak Brook, Illinois

We have audited the accompanying consolidated balance sheets of A.M. Castle & Co. and subsidiaries (the ~~“Company”~~"Company") as of December 31, ~~2013~~2014 and ~~2012,~~2013, and the related consolidated statements of operations and comprehensive loss, ~~stockholders’~~stockholders' equity, and cash flows for each of the three years in the period ended December 31, ~~2013.~~2014. These consolidated financial statements are the responsibility of the ~~Company’s~~Company's management. Our responsibility is to express an opinion on the ~~consolidated~~ financial statements and financial statement schedules based on our audits. We did not audit the financial statements of Kreher Steel Company, LLC, a 50% owned joint ~~venture;~~venture, the Company’s investment in which is accounted for by use of the equity method. The Company’s equity of ~~$41,879~~$37,443 and ~~$38,854~~$41,879 in Kreher Steel Company, LLC’s net assets at December 31, ~~2013~~2014 and ~~2012,~~2013, respectively, and of $7,691, $6,987, ~~$7,224,~~ and ~~$11,727~~$7,224 in that company’s ~~net~~comprehensive income for the years ended December 31, 2014, 2013, ~~2012,~~ and ~~2011,~~2012, respectively, are included in the accompanying consolidated financial statements. Those statements were audited by other auditors whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included for Kreher Steel Company, LLC, is based solely on the report of the other auditors.

In our opinion, based on our audits and the report of the other auditors, such consolidated financial statements present fairly, in all material respects, the financial position of A.M. Castle & Co. and subsidiaries as of December 31, ~~2013~~2014 and ~~2012,~~2013, and the results of ~~its~~their operations and ~~its~~their cash flows for each of the three years in the period ended December 31, ~~2013,~~2014, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the ~~Company’s~~Company's internal control over financial reporting as of December 31, ~~2013,~~2014, based on the criteria established in Internal Control - Integrated Framework ~~(1992)~~ (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March ~~7, 2014,~~6, 2015 expressed an unqualified opinion on the ~~Company’s~~Company's internal control over financial reporting.

/s/ DELOITTE & TOUCHE LLP

DELOITTE & TOUCHE LLP

Chicago, Illinois

March ~~7, 2014~~6, 2015

Kreher Steel Company, LLC and Subsidiaries CONSOLIDATED BALANCE SHEETS December 31,

	2014		2013
ASSETS
Current assets
Cash and cash equivalents	$	1,091,123	$	3,499,350
Accounts receivable (net of allowance for doubtful accounts of $485,172 in 2014 and $475,000 in 2013)	25,686,268		23,997,664
Inventory, net	64,513,673		53,054,067
Deferred taxes	1,153,708		781,288
Prepaid income taxes	566,087		639,063
Prepaid expenses and other current assets	667,768		855,497
Total current assets	93,678,627		82,826,929

Property and equipment
Land and building	14,785,593		14,639,129
Machinery and equipment	20,217,761		18,068,234
Furniture, fixtures and office equipment	2,160,436		2,200,724
Automobiles and trucks	1,106,946		949,359
Leasehold improvements	2,700,101		2,340,211
Construction in progress	345,996		259,379
	41,316,833		38,457,036
Less accumulated depreciation and amortization	18,620,949		16,738,303
Property and equipment, net	22,695,884		21,718,733
Deferred financing costs, net of amortization	76,290		87,969
Goodwill	3,525,247		3,525,247
Intangible assets, net of amortization	30,624		153,120
Other assets	49,633		130,073
	$	120,056,305	$	108,442,071

LIABILITIES AND MEMBER'S CAPITAL
Current liabilities
Current portion of long-term debt	$	17,816	$	208,365
Accounts payable	9,489,017		8,498,498
Accrued expenses	2,389,143		1,841,036
Total current liabilities	11,895,976		10,547,899
Revolving line of credit	33,100,000		12,300,000
Deferred taxes, non-current	2,330,923		2,096,471
Long-term debt, less current portion	38,741		1,706,557
Commitments and contingencies
Member's capital	72,690,665		81,791,144
	$	120,056,305	$	108,442,071

Kreher Steel Company, LLC and Subsidiaries
CONSOLIDATED BALANCE SHEETS
December 31,
2013 2012
ASSETS
Current assets
Cash and cash equivalents $ 3,499,350
$ 3,373,355
Accounts receivable (net of allowance for doubtful accounts of $475,000 in 2013 and $1,435,000 in 2012) 23,997,664
19,736,301
Inventory, net 53,054,067
66,958,361
Deferred taxes 781,288
271,553
Prepaid income taxes 639,063
1,424,064
Prepaid expenses and other current assets 855,497
657,039
Total current assets 82,826,929
92,420,673

Property and equipment
Land and building 14,639,129
14,485,343
Machinery and equipment 18,068,234
16,533,990
Furniture, fixtures and office equipment 2,200,724
2,155,447
Automobiles and trucks 949,359
990,508
Leasehold improvements 2,340,211
2,334,855
Construction in progress 259,379
266,129
38,457,036
36,766,272
Less accumulated depreciation and amortization 16,738,303
14,719,685
Property and equipment, net 21,718,733
22,046,587
Deferred financing costs, net of amortization 87,969
104,616
Goodwill 3,525,247
3,525,247
Intangible assets, net of amortization 153,120
275,616
Other assets 130,073
146,785
$ 108,442,071
$ 118,519,524

LIABILITIES AND MEMBER'S CAPITAL
Current liabilities
Current portion of long-term debt $ 208,365
$ 211,894
Accounts payable 8,498,498
11,536,613
Accrued expenses 1,841,036
2,565,966
Total current liabilities 10,547,899
14,314,473
Revolving line of credit 12,300,000
24,000,000
Deferred taxes, non-current 2,096,471
1,977,273
Long-term debt, less current portion 1,706,557
1,867,707
Commitments and contingencies
Member's capital 81,791,144
76,360,071
$ 108,442,071
$ 118,519,524

Kreher Steel Company, LLC and Subsidiaries CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Years ended December 31,

	2014			2013			2012
Net revenues	$	259,486,523		$	230,350,590		$	257,776,157
Cost of sales	216,093,492			192,600,138			213,490,152
Gross profit	43,393,031			37,750,452			44,286,005
Operating expenses
Selling	13,670,360			12,466,985			12,970,475
General and administrative	10,263,243			8,956,275			12,657,611
Total operating expenses	23,933,603			21,423,260			25,628,086
Earnings from operations	19,459,428			16,327,192			18,657,919
Other expense (income)
Interest expense	343,640			397,256			519,416
Interest income	(2,985		)	(155		)	(3,263		)
Other income, net	(191,268		)	(190,593		)	(169,015		)
Net earnings before taxes	19,310,041			16,120,684			18,310,781
Income tax provision	3,755,450			2,401,060			3,708,101
NET EARNINGS	15,554,591			13,719,624			14,602,680

Other comprehensive income
Foreign currency translation adjustment	(397,812		)	(362,989		)	15,554
COMPREHENSIVE INCOME	$	15,156,779		$	13,356,635		$	14,618,234

Kreher Steel Company, LLC and Subsidiaries
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Years ended December 31,
2013 2012 2011
Net revenues $ 230,350,590
$ 257,776,157
$ 269,657,054
Cost of sales 192,600,138
213,490,152
219,478,535
Gross profit 37,750,452
44,286,005
50,178,519
Operating expenses
Selling 12,466,985
12,970,475
12,761,204
General and administrative 8,956,275
12,657,611
9,970,335
Total operating expenses 21,423,260
25,628,086
22,731,539
Earnings from operations 16,327,192
18,657,919
27,446,980
Other expense (income)
Interest expense 397,256
519,416
432,990
Interest income (155 ) (3,263 ) (1,994 )
Other income, net (190,593 ) (169,015 ) (180,807 )
Net earnings before taxes 16,120,684
18,310,781
27,196,791
Income tax provision (benefit) 2,401,060
3,708,101
3,553,382
NET EARNINGS 13,719,624
14,602,680
23,643,409

Other comprehensive income
Foreign currency translation adjustment (362,989 ) 15,554
—
COMPREHENSIVE INCOME $ 13,356,635
$ 14,618,234
$ 23,643,409

Kreher Steel Company, LLC and Subsidiaries CONSOLIDATED STATEMENTS OF MEMBERS’ CAPITAL Three years ended December 31, 2014

											Accumulated
											other			Total
	Member's		Retained		Accumulated			Treasury			comprehensive			member's
	contribution		earnings		distributions			stock			income			capital
Balance at January 1, 2012, 400 units	7,042,411		102,058,281		(32,661,153		)	(5,240,092		)	—			71,199,447
Net earnings	—		14,602,680		—			—			—			14,602,680
Distributions	—		—		(9,457,600		)	—			—			(9,457,600		)
Foreign currency translation adjustment	—		—		—			—			15,544			15,544
Balance at December 31, 2012, 400 units	7,042,411		116,660,961		(42,118,753		)	(5,240,092		)	15,544			76,360,071
Net earnings	—		13,719,624		—			—			—			13,719,624
Distributions	—		—		(7,925,562		)	—			—			(7,925,562		)
Foreign currency translation adjustment	—		—		—			—			(362,989		)	(362,989		)
Balance at December 31, 2013, 400 units	7,042,411		130,380,585		(50,044,315		)	(5,240,092		)	(347,445		)	81,791,144
Net earnings	—		15,554,591		—			—			—			15,554,591
Distributions	—		—		(24,257,258		)	—			—			(24,257,258		)
Foreign currency translation adjustment	—		—		—			—			(397,812		)	(397,812		)
Balance at December 31, 2014, 400 units	$	7,042,411	$	145,935,176	$	(74,301,573	)	$	(5,240,092	)	$	(745,257	)	$	72,690,665

Kreher Steel Company, LLC and Subsidiaries
CONSOLIDATED STATEMENTS OF MEMBERS’ CAPITAL
Three years ended December 31, 2013
Accumulated
other Total
Member's Retained Accumulated Treasury comprehensive member's
contribution earnings distributions stock income capital
Balance at January 1, 2011, 400 units 7,042,411
78,414,872
(26,426,363 ) (5,240,092 ) —
53,790,828
Net earnings —
23,643,409
—
—
—
23,643,409
Distributions —
—
(6,234,790 ) —
—
(6,234,790 )
Balance at December 31, 2011, 400 units 7,042,411
102,058,281
(32,661,153 ) (5,240,092 ) —
71,199,447
Net earnings —
14,602,680
—
—
—
14,602,680
Distributions —
—
(9,457,600 ) —
—
(9,457,600 )
Foreign currency translation adjustment —
—
—
—
15,544
15,544
Balance at December 31, 2012, 400 units 7,042,411
116,660,961
(42,118,753 ) (5,240,092 ) 15,544
76,360,071
Net earnings —
13,719,624
—
—
—
13,719,624
Distributions —
—
(7,925,562 ) —
—
(7,925,562 )
Foreign currency translation adjustment —
—
—
—
(362,989 ) (362,989 )
Balance at December 31, 2013, 400 units $ 7,042,411
$ 130,380,585
$ (50,044,315 ) $ (5,240,092 ) $ (347,445 ) $ 81,791,144

Kreher Steel Company, LLC and Subsidiaries CONSOLIDATED STATEMENTS OF CASH FLOWS Years ended December 31,	Kreher Steel Company, LLC and Subsidiaries CONSOLIDATED STATEMENTS OF CASH FLOWS Years ended December 31,									Kreher Steel Company, LLC and Subsidiaries CONSOLIDATED STATEMENTS OF CASH FLOWS Years ended December 31,

	2013			2012			2011			2014			2013			2012
Cash flows from operating activities
Net earnings	$	13,719,624		$	14,602,680		$	23,643,409		$	15,554,591		$	13,719,624		$	14,602,680
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities
Adjustments to reconcile net earnings to net cash provided by operating activities
Depreciation and amortization	2,216,894			2,033,956			1,602,925			2,293,664			2,216,894			2,033,956
Deferred taxes	(390,537		)	726,671			390,341			(137,968		)	(390,537		)	726,671
Bad debt expense	(607,635		)	2,595,710			34,779
Bad debt expense (adjustment)										48,602			(607,635		)	2,595,710
(Gain) loss on sale of property and equipment	9,635			(4,851		)	9,790			20,487			9,635			(4,851		)
Changes in assets and liabilities
Accounts receivable	(5,400,225		)	10,129,971			(8,508,956		)	(1,835,526		)	(5,400,225		)	10,129,971
Inventory	13,591,901			2,339,061			(27,383,374		)	(11,766,966		)	13,591,901			2,339,061
Prepaid expenses and other assets	608,511			(1,400,121		)	(58,839		)	340,740			608,511			(1,400,121		)
Accounts payable	(1,325,611		)	(9,557,992		)	3,900,243			891,895			(1,344,931		)	(9,596,997		)
Accrued expenses	(723,252		)	(1,075,536		)	1,215,113			553,598			(723,252		)	(1,075,536		)
Net cash provided by (used in) operating activities	21,699,305			20,389,549			(5,154,569		)
Net cash provided by operating activities										5,963,117			21,679,985			20,350,544
Cash flows from investing activities
Purchases of property and equipment	(1,854,848		)	(5,258,846		)	(6,735,595		)	(3,042,371		)	(1,835,528		)	(5,219,841		)
Proceeds from sale of property and equipment	89,467			145,605			19,843			54,963			89,467			145,605
Net cash used in investing activities	(1,765,381		)	(5,113,241		)	(6,715,752		)	(2,987,408		)	(1,746,061		)	(5,074,236		)
Cash flows from financing activities
Net (decrease) increase in line of credit	(11,700,000		)	(11,000,000		)	22,163,000
Repayment on revolving lines of credit										(7,700,000		)	(25,100,000		)	(37,376,804		)
Borrowings on revolving lines of credit										28,500,000			13,400,000			26,376,804
Repayment of long-term debt	(164,679		)	(217,310		)	(268,089		)	(1,858,365		)	(164,679		)	(217,310		)
Distributions to member	(7,925,562		)	(9,457,600		)	(6,234,790		)	(24,257,258		)	(7,925,562		)	(9,457,600		)
Net cash (used in) provided by financing activities	(19,790,241		)	(20,674,910		)	15,660,121
Net cash used in financing activities										(5,315,623		)	(19,790,241		)	(20,674,910		)
Effect of exchange rate changes on cash and cash equivalents	(17,688		)	28,137			—			(68,313		)	(17,688		)	28,137
Net (decrease) increase in cash and cash equivalents	125,995			(5,370,465		)	3,789,800			(2,408,227		)	125,995			(5,370,465		)
Cash and cash equivalents at beginning of year	3,373,355			8,743,820			4,954,020			3,499,350			3,373,355			8,743,820
Cash and cash equivalents at end of year	$	3,499,350		$	3,373,355		$	8,743,820		$	1,091,123		$	3,499,350		$	3,373,355
Supplemental disclosures of cash flow information
Cash paid during the year for
Interest	$	346,089		$	422,074		$	350,341		$	243,487		$	346,089		$	422,074
Income taxes, net of refunds	1,994,098			4,855,764			2,910,000			3,770,000			1,994,098			4,855,764
Supplemental disclosures of non-cash investing and financing activities
Acquisition of machinery and equipment through capital leases	$	46,969		$	—		$	—		$	—		$	46,969		$	—
Acquisition of property and equipment through accounts payable										$	165,594		$	19,320		$	39,005

8584

NOTE A - NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Company

Kreher Steel Company, LLC and Subsidiaries (the Company) was formed as a limited liability company (LLC) on January 11, 1996, and commenced business on May 1, 1996. The LLC member’s initial contribution consisted of the net assets of Kreher Steel Co., Inc.

The Company is a national distributor and processor of carbon and alloy steel bar products. The Company has locations throughout the United States and in Edmonton, Canada, and primarily sells in the vicinity of these locations.

Principles of Consolidation

The Company’s financial statements are presented on a consolidated basis and include its wholly owned subsidiaries, Kreher Wire Processing, Inc. and Special Metals, Inc., as well as a branch of Kreher Steel Company, LLC located in Edmonton, Canada. All intercompany transactions and balances have been eliminated.

Use of Estimates

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates.

Cash and Cash Equivalents

The Company considers all highly liquid investments with maturities of three months or less to be cash equivalents. The Company maintains cash balances at financial institutions in the United States of America that are insured by the Federal Deposit Insurance Corporation (FDIC). At December 31, ~~2013~~2014 and ~~2012,~~2013, the Company had approximately ~~$2,746,000~~$909,000 and ~~$2,113,000,~~$2,746,000, respectively, in excess of FDIC insured limits. The Company has not experienced any losses related to these balances, and management believes its credit risk to be minimal. At December 31, 2014 and 2013, the Company had approximately $339,000 and $697,000, respectively of cash in foreign bank accounts. The Company’s cash in foreign bank accounts is insured up to $100,000.

Shipping and Handling Fees

For the years ended December 31, 2014, 2013 ~~2012~~ and ~~2011,~~2012, shipping and handling costs billed to customers amounted to approximately $1,859,000, $1,174,000 ~~$1,548,000~~ and ~~$1,431,230,~~$1,548,000, respectively, and were included in selling expenses.

Financial Instruments and Risk Management

Concentrations of credit risk with respect to trade receivables are limited due to the large number of customers comprising the Company’s customer base and their dispersion across different businesses and geographic areas. At December 31, 2014, 2013 ~~2012~~ and ~~2011,~~2012, there were no individual customers that made up more than 10% of consolidated sales.

The Company’s financial instruments include cash equivalents, accounts receivable, accounts payable and notes payable. The carrying amounts of cash equivalents, accounts receivable, accounts payable and notes payable approximate fair value due to their short-term nature and variable interest rates paid.

The Financial Accounting Standards Board has established a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which give the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical

or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3 - Inputs that are both significant to the fair value measurement and unobservable.

Prices for steel fluctuate based on worldwide production and, as a result, the Company is subject to the risk of future changing market prices. Furthermore, the Company purchased approximately 7%9%, 6%7% and 9%6% of its inventory from foreign suppliers for the years ended December 31, 2014, 2013 ~~2012~~ and ~~2011,~~2012, respectively.

Inventory

Inventory is valued at the lower of cost or market. Cost is determined by the specific identification method. The Company provides a reserve for obsolete and slow-moving inventory. As of December 31, ~~2013~~2014 and ~~2012,~~2013, the reserve for obsolete and slow-moving inventory was approximately ~~$1,829,000~~$1,774,000 and ~~$810,000,~~$1,829,000, respectively.

Changes in the Company’s inventory reserve are as follows at December 31:


							2014			2013
	2013			2012
Beginning balance	$	809,667		$	583,346		$	1,828,606		$	809,667
Provision	1,146,834			307,440			106,663			1,146,834
Write-offs	(127,895		)	(81,119		)	(161,308		)	(127,895		)

Total inventory reserve	$	1,828,606		$	809,667		$	1,773,961		$	1,828,606

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation. Depreciation is based on the straight-line method and the estimated useful lives of the property and equipment. Depreciation of leasehold improvements is based on the estimated useful life or the term of the lease, whichever is shorter. The Company uses an accelerated method of depreciation for tax purposes. Depreciation expense for December 31, 2014, 2013 ~~2012~~ and ~~2011,~~2012, was approximately $2,177,000, $2,098,000 ~~$1,911,000~~ and ~~$1,467,000,~~$1,911,000, respectively.

Depreciable lives by asset classification are as follows:



Asset description		Life

Furniture and fixtures		5 - 7 years
Office equipment		5 - 7 years
Machinery and equipment		7 - 10 years
Automobiles and trucks		3 - 5 years
Building and leasehold improvements		7 - 40 years

Repairs and maintenance are charged to expense when incurred. Expenditures for improvements are capitalized. Upon sale or retirement, the related cost and accumulated depreciation or amortization are removed from the respective accounts, and any resulting gain or loss is included in operations.

~~Long-Lived~~Long-lived Assets

The Company reviews the carrying values of its long-lived assets for possible impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may not be recoverable. Any long-lived assets held for disposal are reported at the lower of their carrying amounts or fair value less cost to sell. No triggering events were identified during each year presented that would require an impairment analysis. Additionally, no assets were held for disposal as of December 31, ~~2013~~2014 or ~~2012.~~2013.

Goodwill and Intangible Assets

Goodwill represents the excess of purchase price paid over the fair values of net assets acquired and liabilities assumed in the Company’s acquisitions.

Intangible assets include non-competition agreements and non-contractual customer relationships. The fair value of identifiable intangible assets was estimated based on discounted future cash flow projections. Intangible assets are amortized on a straight-line basis over their estimated economic lives. The weighted-average useful life of intangible assets was eight years as of December 31, ~~2013.~~2014.

The Company evaluates the recoverability of identifiable intangible assets whenever events or changes in circumstances indicate that an intangible asset’s carrying amount may not be recoverable. Such circumstances could include, but are not limited to, a significant decrease in the market value of the asset, a significant adverse change in the extent or manner in which an asset is used, or an accumulation of costs significantly in excess of the amount originally expected for the acquisition of an asset. No events or changes in circumstances were identified during the year that required an impairment analysis.

Management is required to evaluate goodwill for impairment on an annual basis. The Company tests for impairment using a two-step process that involves (1) comparing the estimated fair value of the reporting unit to its carrying value including goodwill and (2) comparing the estimated implied fair value of goodwill and intangible assets to its carrying value. Goodwill and intangible assets were valued on the date of the acquisition. As of December 31, ~~2013~~2014 and ~~2012,~~2013, there was no impairment of the goodwill or intangible assets acquired based on the analysis performed.

Revenue Recognition

Revenue from the sale of goods is recognized at the time of shipment, except for revenue from sales of products to certain customers whose contractual terms specify FOB destination. Revenue from sales of products to these customers is recognized at the time of receipt by the customer when title and risk of loss pass to the customer.

Accounts Receivable

Credit is extended based on an evaluation of a customer’s financial condition and, generally, collateral is not required. Accounts receivable are generally due within 30 days of the negotiated terms and are stated at amounts due from customers net of an allowance for doubtful accounts. Accounts outstanding longer than the contractual payment terms

are considered past due. The Company maintains reserves for potential losses on receivables and credits from its customers, and these losses have not exceeded management’s expectations. The Company determines its allowance for doubtful accounts by considering a number of factors, including the length of time trade accounts receivable are past due, the Company’s previous loss history, the customer’s current ability to pay its obligation to the Company, and the condition of the general economy and the industry as a whole. The Company writes off accounts receivable when they become uncollectible, and payments subsequently received on such receivables are credited to the allowance for doubtful accounts.

Economic Dependency - Major Suppliers

During the years ended December 31, 2014, 2013 ~~2012~~ and ~~2011,~~2012, the Company purchased approximately ~~51%~~46%, ~~44%~~51% and ~~45%~~44%, respectively, of its materials from five suppliers.

Deferred Financing Costs

Deferred financing costs are amortized over the life of the underlying credit agreement or the expected remaining life of the underlying credit agreement.

Income Taxes

As an LLC, the Company is not subject to federal and state income taxes, and its income or loss is allocated to and reported in the tax returns of its member. Accordingly, no liability or provision for federal and state income taxes attributable to the LLC’s operations is included in the accompanying financial statements. The Company provides for income taxes for its wholly owned subsidiaries, Kreher Wire Processing, Inc. and Special Metals, Inc., which are subject to federal and state income taxes as they are structured as C ~~Corporations.~~corporations. Special Metals Canada, which is structured

as a foreign branch of a domestic company, will pay federal and provincial taxes in Canada. The taxes paid will be reported to the member in order to claim foreign tax credits.

The Company applies a comprehensive model for the financial statement recognition, measurement, classification and disclosure of uncertain tax positions. In the first step of the two-step process, the Company evaluates the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. In the second step, the Company measures the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. As of December 31, ~~2013~~2014 and ~~2012,~~2013, the Company determined that there are no uncertain tax positions with a more than 50% likelihood of being realized upon settlement.

Advertising Costs

Advertising costs are charged to expense when the advertisement is first run. The Company expensed advertising costs of approximately $140,000, $158,000 and $102,000 in 2014, 2013 and ~~$80,000 in 2013,~~ 2012, ~~and 2011,~~ respectively.

Reclassifications

Certain ~~reclassifications of prior-year presentations~~amounts from prior years have been ~~made~~reclassified to conform to the ~~2013~~current year’s presentation.

NOTE B - INTANGIBLE ASSETS

Intangible assets are amortized using the straight-line method, using the remaining useful life, and are as follows at December 31, ~~2013:~~2014:



		Remaining
Asset description		useful life

Non-contractual customer relationships		~~1.25~~.25 years

The following is a summary of intangible assets at December 31:


	2013		2012		2014		2013
Intangible assets
Finite life
Non-compete agreements	$	220,000	$	220,000	$	220,000	$	220,000
Non-contractual customer relationships	980,000		980,000		980,000		980,000
	1,200,000		1,200,000
					1,200,000		1,200,000

Less accumulated amortization	1,046,880		924,384		1,169,376		1,046,880

Net intangible assets	$	153,120	$	275,616	$	30,624	$	153,120

Amortization expense related to identifiable intangible assets was $122,496, $122,496 and ~~$136,245~~$122,496 for the years ended December 31, 2014, 2013 ~~2012~~ and ~~2011,~~2012, respectively. The intangible assets related to the non-compete agreements became fully amortized during 2011. ~~Estimated annual amortization expense as~~As of December 31, ~~2013, is a follows:~~2014, the remaining balance will be fully amortized during the year ending December 31, 2015, in the amount of $30,624.

Years ending December 31,
2014 $ 122,496
2015 30,624

NOTE C - TRANSACTIONS WITH AFFILIATES

At December 31, 2014 and 2013, there were no accounts receivable from companies related through common ownership. ~~Included in accounts receivable at December 31, 2012, was approximately $3,000 due from companies related through common ownership.~~

Included in accounts payable at December 31, ~~2013~~2014 and ~~2012,~~2013, was approximately ~~$8,000~~$17,000 and ~~$21,000,~~$8,000, respectively, due to companies related through common ownership.

Sales to and purchases from companies related through common ownership for the year ended December 31, 2014, were approximately $364,000 and $4,178,000,respectively, for the year ended December 31, 2013, were approximately $118,000 and $1,226,000, respectively, and for the year ended December 31, 2012, were approximately $695,000 and $809,000, ~~respectively, and for the year ended December 31, 2011, were approximately $851,000 and $2,294,000,~~respectively.

NOTE D - ALLOWANCE FOR DOUBTFUL ACCOUNTS

Changes in the Company’s allowance for doubtful accounts are as follows at December 31:


							2014			2013
	2013			2012
Beginning balance	$	1,435,000		$	1,335,000		$	475,000		$	1,435,000
Bad debt expense (adjustment)	(607,635		)	2,595,710			48,602			(607,635		)
Recoveries	8,196			20,125			1,250			8,196
Accounts written off	(360,561		)	(2,515,835		)	(39,680		)	(360,561		)

Total allowance for doubtful accounts	$	475,000		$	1,435,000		$	485,172		$	475,000

NOTE E - DEBT

Debt as of December 31, ~~2013~~2014 and ~~2012,~~2013, is as follows:


	2013		2012		2014		2013
Notes payable
Michigan Strategic Fund Limited Obligation Revenue Bonds (2000)	$	795,000	$	875,000	$	—	$	795,000
Michigan Strategic Fund Limited Obligation Revenue Bonds (2006)	1,050,000		1,150,000		—		1,050,000
Capitalized leases	69,922		54,601

Total notes payable	1,914,922		2,079,601		—		1,845,000

Revolving line of credit	12,300,000		24,000,000		33,100,000		12,300,000

Total debt	$	14,214,922	$	26,079,601	$	33,100,000	$	14,145,000

In April 2012, the Company entered into a new loan agreement. The loan named both the Company and its subsidiary, Special Metals, Inc., as co-borrowers. In June 2014, the Company amended the agreement to include Kreher Wire Processing, Inc. as a co-borrower. The loan is for $50,000,000, which can be increased to $65,000,000 in $5,000,000 increments. The interest charged on the loan is divided into the LIBOR portion and the prime rate portion. The outstanding balance on the LIBOR portion at a rate of ~~1.17%~~1.42% was ~~$10,000,000~~$29,000,000 at December 31, ~~2013.~~2014. The outstanding balance on the prime rate portion at a rate of ~~2.75%~~3.25% was ~~$2,300,000~~$4,100,000 at December 31, ~~2013.~~2014. The loan is secured by the Company’s receivables, inventory and fixed ~~assets, and expires in April 2017.~~assets. As of December 31, 2014, the Company’s debt of $33,100,000 is set to mature during the year ending December 31, 2019. There are no earlier dates of maturity. The carrying value of debt approximates fair value given the variable nature of the interest rates.

The Company is in compliance with all covenants related to the revolving credit agreements and all other notes payable.

In 2000, the Company’s subsidiary, Kreher Wire Processing, Inc., obtained a Michigan Strategic Fund Limited Obligation Revenue Bond for $4,900,000. Interest is charged at a variable rate as defined in the agreement. In February 2014, the bonds were called for full redemption. The interest rate as of December 31, 2013, ~~and 2012,~~ was 0.16% and 0.23%, respectively. The Company makes monthly interest payments and annual principal and debt service payments. The Company is also required to make annual payments for the letter of credit fee. The bonds mature on May 1, 2016..

In 2006, Kreher Wire Processing, Inc. obtained a Michigan Strategic Fund Limited Obligation Revenue Bond for $2,695,000. Interest is charged at a variable rate as defined in the agreement. In February 2014, the bonds were called for full redemption. The interest rate as of December 31, 2013, ~~and 2012,~~ was 0.16% and 0.23%, respectively. The Company makes monthly interest payments and annual principal and debt service payments. The Company is also required to make quarterly payments for the letter of credit fee. The bonds mature on October 1, 2021.

In 2010 and 2013, Special Metals, Inc. entered into several lease agreements that met the criteria for capitalization. At December 31, 2013 and 2012, the gross amount of cost related to capital leases included in machinery and equipment was approximately $197,000 and $150,000, respectively. Related accumulated amortization at December 31, 2013 and 2012, was approximately $137,000 and $110,000, respectively. The total rental payments incurred for the years ended December 31, 2013, 2012 and 2011, were approximately $57,000, $73,000 and $73,000, respectively..

~~The carrying value of debt approximates fair value given the variable nature of the interest rates. Maturities of debt at December 31, 2013, are as follows:~~

Years ending December 31,
2014 $ 208,365
2015 232,816
2016 733,234
2017 12,438,964
2018 151,543
Thereafter 450,000
Total $ 14,214,922

NOTE F - INCOME TAXES

As an LLC, the Company is not subject to federal and state income taxes, and its income or loss is allocated to and reported in the tax returns of its member. The Company provides for income taxes for its wholly owned subsidiaries, Kreher Wire Processing, Inc. and Special Metals, Inc., which are subject to federal and state income taxes. The Company also provides for federal and provincial taxes at Special Metals Canada, which is structured as a foreign branch of a domestic company. The taxes paid will be reported to the member in order to claim foreign tax credits.

The tax effect of temporary differences that give rise to deferred tax assets and liabilities as of December 31, ~~2013~~2014 and ~~2012,~~2013, are as follows:


	2013			2012			2014			2013
Deferred tax assets
Accounts receivable and inventory reserves	$	781,288		$	271,553		$	1,153,708		$	781,288

Deferred tax liabilities
Amortization of intangibles	(61,248		)	(110,246		)	(12,250		)	(61,248		)
Depreciation and other	(2,035,223		)	(1,867,027		)	(2,318,673		)	(2,035,223		)

Total deferred tax liabilities	(2,096,471		)	(1,977,273		)	(2,330,923		)	(2,096,471		)

Net deferred tax liabilities	$	(1,315,183	)	$	(1,705,720	)	$	(1,177,215	)	$	(1,315,183	)

The net current and non-current components of the deferred income taxes recognized in the balance sheets at December 31, ~~2013~~2014 and ~~2012,~~2013, are as follows:


							2014			2013
	2013			2012
Net current assets	$	781,288		$	271,553		$	1,153,708		$	781,288
Net long-term liabilities	(2,096,471		)	(1,977,273		)	(2,330,923		)	(2,096,471		)

Total net deferred tax liabilities	$	(1,315,183	)	$	(1,705,720	)	$	(1,177,215	)	$	(1,315,183	)

Income tax expense consists of the following components as of December 31:


	2013			2012			2011		2014			2013			2012
Current
Federal	$	2,553,576		$	2,673,070		$	2,667,703	$	3,289,892		$	2,553,576		$	2,673,070
State	212,006			398,649			495,338		593,421			212,006			398,649
Foreign	26,015			(90,289		)	—		10,105			26,015			(90,289		)
Deferred	(390,537		)	726,671			390,341		(137,968		)	(390,537		)	726,671

Total income tax expense	$	2,401,060		$	3,708,101		$	3,553,382	$	3,755,450		$	2,401,060		$	3,708,101

The differences between the federal statutory rate of 34% and the effective rate are due to state income taxes, permanent deductions and the fact that no tax provisions are recorded for operations attributable to Kreher Steel Company, LLC in the accompanying financial statements. Tax years dated back to December 31, ~~2010,~~2011, are open for federal and state tax audit purposes. The total effective rate of the subsidiaries at December 31, 2014, 2013 and 2012, was 19.4%, 14.9% and ~~2011, was 14.9%,~~ 20.2% ~~and 13.1%~~, respectively.

A reconciliation of the effective income tax rate to the U.S. statutory tax rate is as follows:


							2014		2013		2012
	2013		2012		2011
U.S. statutory tax rate	34.0	%	34.0	%	34.0	%	34.0	%	34.0	%	34.0	%
Non-taxable LLC income	(19.8	)	(16.2	)	(21.1	)	(16.2	)	(19.8	)	(16.2	)
State and local taxes - net of federal tax expense	1.6		2.2		0.5		3.1		1.6		2.2
Foreign taxes	(0.1	)	(0.2	)	—		(0.1	)	(0.1	)	(0.2	)
Permanent and other	(0.8	)	0.4		(0.3	)	(1.4	)	(0.8	)	0.4

Effective tax rate	14.9	%	20.2	%	13.1	%	19.4	%	14.9	%	20.2	%

NOTE G - COMMITMENTS

Operating Lease Commitments

The Company leases certain equipment and warehouse space under operating lease obligations with rent escalation clauses for the warehouse space only. Accordingly, the Company has recorded these lease obligations on a straight-line basis and recorded a deferred rent liability of approximately ~~$20,000~~$28,000 and ~~$53,000~~$20,000 for the years ended December 31, ~~2013~~2014 and ~~2012,~~2013, respectively. Rent expense, net of sublease income for the years ended December 31, 2014, 2013 ~~2012~~ and ~~2011,~~2012, was approximately $1,220,000, $1,335,000 ~~$1,339,000~~ and ~~$1,081,000,~~$1,339,000, respectively. The following shows minimum future rental payments for the next five years under these obligations:


Years ending December 31,
2014	$	679,483

2015	648,697		$	692,732
2016	595,418		634,636
2017	470,684		492,296
2018 and thereafter	658,278
2018			444,659
2019 and thereafter			230,062

~~Health Insurance~~

Capital Lease Commitments

In 2010 and 2013, Special Metals, Inc. entered into several lease agreements that met the criteria for capitalization. At December 31, 2014 and 2013, the gross amount of cost related to capital leases included in machinery and equipment was approximately $197,000. Related accumulated amortization at December 31, 2014 and 2013 was approximately $154,000 and $137,000, respectively. The ~~Company maintains a fully insured health insurance plan. Approximately $2,060,000, $1,955,000~~total rental payments incurred for the years ended December 31, 2014, 2013 and ~~$1,583,000~~2012, were ~~expensed in 2013, 2012~~approximately $44,000, $57,000 and ~~2011, respectively, under this plan.~~$73,000, respectively.

At December 31, 2014, the Company had assets held as capital leases with a net book value of $43,000 included in property, plant and equipment. Total future capital lease obligations relating to the leases are as follows:



Years ending December 31,
2015	$	42,400
2016	27,310
2017	27,310
2018	20,482
Total future capital lease obligation payments	117,502
Less amounts representing interest	(60,945		)
Present value of future capital lease obligation payments	$	56,557

Health Insurance

The Company and its wholly owned subsidiary maintained a fully insured health insurance plan. On January 1, 2014, the Company and the wholly owned subsidiary changed to a partially self-funded plan under which the Company is self-insured to a maximum of $65,000 per individual per year. The maximum Company liability is approximately $2,267,000 for the group as a whole. Approximately $1,977,000, $2,060,000 and $1,955,000 was expensed in 2014, 2013 and 2012, respectively, under these plans. The Company has accrued approximately $306,000 for health insurance claims not processed at December 31, 2014.

NOTE H - EMPLOYEE BENEFIT PLAN

The Company maintains a qualified plan under Section 401(k) of the Internal Revenue Code. This plan is available for all employees who have completed one year or more of continuous service. The plan allows employees to contribute an annual limit of the lesser of 60% of eligible compensation or $17,500 ~~and $17,000~~ (the federal ~~limits~~limit for ~~2013~~2014 and ~~2012 respectively)~~2013). ~~The Company will match contributions at the discretion of management.~~ The Company has a non-discretionary match of 100%, up to 4% of what employees elect. The Company also has a profit-sharing match of $500 per participant, which is discretionary. This discretionary match was paid in 2014, 2013 ~~2012~~ and ~~2011.~~2012. Participants are fully vested at all times in their contributions and become fully vested in the Company’s contributions over a defined period. ~~The plan is responsible for costs associated with its administration.~~ Approximately $301,000, $276,000 ~~$280,000~~ and ~~$200,000~~$280,000 was charged to expense for the years ended December 31, 2014, 2013 and 2012, ~~and 2011,~~ respectively. The plan is responsible for costs associated with its administration.

The Company also maintains a qualified plan under Section 401(k) of the Internal Revenue Code at a wholly owned subsidiary. This plan is available for all employees who have completed one year or more of continuous service. The plan allows employees to contribute an annual limit of $17,500 (the federal limit for 2014 and 2013). The Company will match contributions at the discretion of management. The Company also has a discretionary profit-sharing contribution. Participants are fully vested in all contributions. During 2014, 2013 and 2012, approximately $420,000, $360,000 and $320,000, respectively, was charged to expense. The plan is responsible for costs associated with its administration. ~~During 2013, 2012 and 2011, approximately $360,000, $320,000 and $240,000, respectively, was charged to expense.~~

NOTE I - CONTINGENCIES

The Company is subject to various legal proceedings that have arisen in the normal course of business. In the opinion of management, these actions, when concluded and determined, will not have a material adverse effect on the financial position or operations of the Company.

NOTE J - MEMBER’S CAPITAL

The Company is a single-member LLC and shall continue until December 31, 2045.

NOTE K - SUBSEQUENT EVENTS

The Company evaluated its December 31, ~~2013,~~2014, financial statements for subsequent events through February ~~17, 2014,~~20, 2015, the date the financial statements were available to be issued. The Company is not aware of any subsequent events that would require recognition or disclosure in the financial ~~statements, except as described below.~~

Effective January 1, 2014, the Company moved to a fully self-insured health insurance plan. The Company’s exposure under this plan is limited to 125% of expected claims. On February 3, 2014, Kreher Wire Processing paid off the Michigan Industrial Revenue Bonds that were used to finance the acquisition of the company in 2000 and the expansion of the facility in 2006. The balance outstanding on December 31, 2013, was $1,845,000.statements.

9394

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors

Kreher Steel Company, LLC

We have audited the accompanying consolidated balance sheets of Kreher Steel Company, LLC (a Delaware limited liability company) and subsidiaries (the ~~“Company”)~~Company) as of December 31, ~~2013~~2014 and ~~2012,~~2013, and the related consolidated statements of comprehensive income, member’s capital, and cash flows for each of the three years in the period ended December 31, ~~2013.~~2014. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Kreher Steel Company, LLC and subsidiaries as of December 31, ~~2013~~2014 and ~~2012,~~2013, and the results of their operations and their cash flows for each of the three years in the period ended December 31, ~~2013,~~2014, in conformity with accounting principles generally accepted in the United States of America.

/s/ Grant Thornton LLP

Grant Thornton LLP

Chicago, Illinois

February ~~17, 2014~~20, 2015

9495

ITEM 9 — Changes In and Disagreements With Accountants on Accounting and Financial Disclosure

None.

ITEM 9A — Controls & Procedures

Disclosure Controls and Procedures

A review and evaluation was performed by the Company’s management, including the Chief Executive Officer (CEO) and Interim Chief Financial Officer ~~(CFO)~~(Interim CFO), of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) of the Security Exchange Act of 1934). Based upon that review and evaluation, the CEO and Interim CFO have concluded that the Company’s disclosure controls and procedures were effective as of December 31, ~~2013.~~2014.

(a) Management’s Annual Report on Internal Control Over Financial Reporting

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in the Securities Exchange Act of 1934 rule 240.13a-15(f). The Company’s internal control over financial reporting is a process designed under the supervision of the Company’s Chief Executive Officer and Interim Chief Financial Officer to provide reasonable assurance regarding the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles.

Internal control over financial reporting, no matter how well designed, has inherent limitations and may not prevent or detect misstatements. Therefore, even effective internal control over financial reporting can only provide reasonable assurance with respect to the financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

The Company, under the direction of its Chief Executive Officer and Interim Chief Financial Officer, conducted an evaluation of the effectiveness of its internal control over financial reporting as of December 31, ~~2013~~2014 based upon the framework published by the Committee of Sponsoring Organizations of the Treadway Commission, referred to as the Internal Control—Integrated Framework ~~(1992)~~(2013).

Based on our evaluation under the framework in Internal Control — Integrated Framework ~~(1992)~~(2013), the Company’s management has concluded that our internal control over financial reporting was effective as of December 31, ~~2013.~~2014.

The effectiveness of the Company’s internal control over financial reporting as of December 31, ~~2013~~2014 has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their attestation report included in Item 9A of this annual report.

(b) Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of

A.M. Castle & Co.

Oak Brook, Illinois

We have audited the internal control over financial reporting of A.M. Castle & Co. and subsidiaries (the ~~“Company”~~"Company") as of December ~~31, 2013,~~31,2014, based on criteria established in Internal Control - Integrated Framework (2013) ~~(1992)~~ issued by the Committee of Sponsoring Organizations of the Treadway Commission. The ~~Company’s~~Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying ~~Management’s~~Management's Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the ~~Company’s~~Company's internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a

reasonable basis for our opinion.

A ~~company’s~~company's internal control over financial reporting is a process designed by, or under the supervision of, the ~~company’s~~company's principal executive and principal financial officers, or persons performing similar functions, and effected by the ~~company’s~~company's board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with ~~accounting principles generally accepted in the United States of America (“~~generally accepted accounting ~~principles”).~~principles. A ~~company’s~~company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the ~~company’s~~company's assets that could have a material effect on the financial statements.

Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, ~~2013,~~2014, based on the criteria established in Internal Control - Integrated Framework (2013) ~~(1992)~~ issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated financial statements as of and for the year ended December 31, ~~2013,~~2014 of the Company and our report dated March ~~7, 2014,~~6, 2015 expressed an unqualified opinion on those ~~consolidated~~ financial statements.

/s/ DELOITTE & TOUCHE LLP

DELOITTE & TOUCHE LLP

Chicago, Illinois

March ~~7, 2014~~6, 2015

An evaluation was performed by the Company’s management, including the CEO and Interim CFO, of any changes in internal controls over financial reporting that occurred during the last fiscal quarter and that materially affected, or is reasonably likely to materially affect, the Company’s internal controls over financial reporting. The evaluation did not identify any change in the Company’s internal control over financial reporting that occurred during the latest fiscal quarter and that has materially affected, or is reasonably likely to materially affect, the Company’s internal controls over financial reporting.

Item 9B — Other Information

None.

9697

PART III

ITEM 10 — Directors, Executive Officers and Corporate Governance

Information regarding our executive officers is included under the heading “Executive Officers of the Registrant” in Part I of this Annual Report on Form 10-K. All additional information required to be filed in Part III, Item 10, Form 10-K has been included in the sections of the Company's Definitive Proxy Statement for its ~~2014~~2015 annual meeting of shareholders (fiscal ~~2013~~2014 Proxy Statement) dated and to be filed with the Securities and Exchange Commission ~~on or about March 13, 2014~~within 120 days of the Company's fiscal year end, entitled ~~“Proposal 1- Election of Directors,~~“Company Proposals,” “Certain Governance Matters,” and “Section 16(A) Beneficial Ownership Reporting Compliance,” and is hereby incorporated by this specific reference.

ITEM 11 — Executive Compensation

All information required to be filed in Part III, Item 11, Form 10-K, has been included in the sections of the fiscal ~~2013~~2014 Proxy Statement entitled “Compensation Discussion and Analysis,” “Report of the Human Resources Committee,” “Compensation Committee Interlocks and Insider Participation”, “Compensation Risk”, “Non-Employee Director Compensation,” and “Executive Compensation and Other Information” and is hereby incorporated by this specific reference.

ITEM 12 — Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required to be filed in Part III, Item 12, Form 10-K, has been included in the sections of the fiscal ~~2013~~2014 Proxy Statement entitled ~~“Stock~~“Security Ownership of Directors, Management and Principal Stockholders” and “Equity Compensation Plan Information” and is hereby incorporated by this specific reference.

ITEM 13 — Certain Relationships and Related Transactions, and Director Independence

All information required to be filed in Part III, Item 13, Form 10-K, has been included in the sections of the fiscal ~~2013~~2014 Proxy Statement entitled “Related Party Transactions” and “Director Independence; Financial Experts” and is hereby incorporated by this specific reference.

ITEM 14 — Principal Accountant Fees and Services

All information required to be filed in Part III, Item 14, Form 10-K, has been included in the sections of the fiscal ~~2013~~2014 Proxy Statement entitled “Audit and Non-Audit Fees” and “Pre-Approval Policy for Audit and Non-Audit Services” and is hereby incorporated by this specific reference.

9798

PART IV

ITEM 15 — Exhibits

A. M. Castle & Co.

Index To Financial Statements



	Page
Consolidated Statements of Operations and Comprehensive Loss—For the years ended December 31, ~~2013, 2012 and~~ 20114, 2013 and 2012	38
Consolidated Balance Sheets—December 31, ~~2013~~2014 and ~~201~~22013	39
Consolidated Statements of Cash Flows—For the years ended December 31, ~~2013, 2012 and~~ 20114, 2013 and 2012	40
Consolidated Statements of Stockholders’ Equity – For the years ended December 31, ~~2013, 2012 and~~ 20114, 2013 and 2012	41
Notes to Consolidated Financial Statements	42
Report of Independent Registered Public Accounting Firm	8180
Kreher Steel Company, LLC Financial Statements	8281
Exhibit Index

9899

The following exhibits are filed herewith or incorporated by reference.



Exhibit Number		Description of Exhibit
~~2.1~~		Stock Purchase Agreement, dated November 9, 2011, by and among A.M. Castle & Co., Mr. Paul Sorensen, Mr. Jerry Willeford, and Tube Supply, Inc. Filed as Exhibit 2.1 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.

~~2.2~~		Agreement and Amendment, dated December 15, 2011, by and among A.M. Castle & Co., Mr. Paul Sorensen, Mr. Jerry Willeford, Tube Supply, Inc. and A.M. Castle & Co. (Canada) Inc. Filed as Exhibit 2.2 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.

~~2.3~~		Second Amendment to the Stock Purchase Agreement, dated January 13, 2012, by and among A. M. Castle & Co., Mr. Paul Sorensen, Mr. Jerry Willeford, and Tube Supply, LLC (as successor in interest to Tube Supply Inc.). Incorporated by reference to Exhibit 2.3 to the Company's Form S-4/A filed with the SEC on May 25, 2012. Commission File No. 333-180662.

~~2.4~~		Third Amendment to the Stock Purchase Agreement, dated May 11, 2012, by and among A. M. Castle & Co., Mr. Paul Sorensen, Mr. Jerry Willeford, and Tube Supply, LLC (as successor in interest to Tube Supply Inc.). Incorporated by reference to Exhibit 2.4 to the Company's Form S-4/A filed with the SEC on May 25, 2012. Commission File No. 333-180662.

~~2.5~~		Fourth Amendment to the Stock Purchase Agreement, dated September 13, 2012 by and among A. M. Castle & Co., Mr. Paul Sorensen, Mr. Jerry Willeford, and Tube Supply, LLC (as successor in interest to Tube Supply Inc.). Filed as Exhibit 2.6 to Annual Report on Form 10-K for the period ended December 31, 2012, which was filed on March 11, 2013. Commission File No. 1-5415.

~~2.6~~		Fifth Amendment to the Stock Purchase Agreement, dated November 14, 2012 by and among A. M. Castle & Co., Mr. Paul Sorensen, Mr. Jerry Willeford, and Tube Supply, LLC (as successor in interest to Tube Supply Inc.). Filed as Exhibit 2.7 to Annual Report on Form 10-K for the period ended December 31, 2012, which was filed on March 11, 2013. Commission File No. 1-5415.

3.1		Articles of Restatement of the Charter of the Company filed with the State Department of Assessments and Taxation of Maryland on April 27, 2012. Filed as Exhibit 3.1 to Quarterly Report on Form 10-Q for the period ended March 31, 2012, which was filed on May 3, 2012. Commission File No. 1-5415.

3.2		Articles Supplementary of the Company. Filed as Exhibit 3.1 to Form 8-A filed on September 6, 2012. Commission File No. 1-5415.

3.3		Articles Supplementary of A.M. Castle & Co. Filed as Exhibit 3.1 to Form 8-K filed on August 14, 2013. Commission File No. 1-5415.

3.4		Amended and Restated Bylaws of A.M. Castle & Co. adopted August 13, 2013. Filed as Exhibit 3.2 to Form 8-K filed on August 14, 2013. Commission File No. 1-5415.

4.1		Indenture, dated as of December 15, 2011, among A.M. Castle & Co., the Guarantors, U.S. Bank National Association, as trustee and U.S. Bank National Association, as collateral agent. Filed as Exhibit 4.1 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.

4.2		Indenture, dated as of December 15, 2011, between A.M. Castle & Co., the Guarantors and U.S. Bank National Association, as trustee. Filed as Exhibit 4.2 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.

4.3		Rights Agreement, dated as of August 31, 2012, by and between A.M. Castle & Co. and American Stock Transfer & Trust Company, LLC, as Rights Agent. Filed as Exhibit 4.1 to Form 8-K filed on August 31, 2012. Commission File No. 1-5415.

4.4		Amendment No. 1 to Rights Agreement, dated as of August 13, 2013, by and between A.M. Castle & Co. and American Stock Transfer & Trust Company, LLC, as Rights Agent. Filed as Exhibit 4.1 to Form 8-K filed on August 14, 2013. Commission File No. 1-5415.

10.1*		A. M. Castle & Co. ~~1995 Director Stock Option Plan. Filed as Exhibit A to Proxy Statement filed March 7, 1995. Commission File No. 1-5415.~~



~~Exhibit~~ ~~Number~~		~~Description of Exhibit~~
10.2*		~~A. M. Castle & Co. 1996 Restricted Stock and Stock Option Plan. Filed as Exhibit A to Proxy Statement filed March 8, 2006. Commission File No. 1-5415.~~

10.3*		~~A. M. Castle & Co. 2000 Restricted Stock and Stock Option Plan. Filed as Appendix B to Proxy Statement filed March 23, 2001. Commission File No. 1-5415.~~

10.4*		~~A. M. Castle & Co.~~ 2004 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit D to Proxy Statement filed March 12, 2004. Commission File No. 1-5415.

10.510.2		Form of Restricted Stock Award Agreement under A. M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.11 to Annual Report on Form 10-K for the period ended December 31, 2008, which was filed on March 12, 2009. Commission File No. 1-5415.

10.610.3		Form of Performance Share Award Agreement under A. M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.12 to Annual Report on Form 10-K for the period ended December 31, 2008, which was filed on March 12, 2009. Commission File No. 1-5415.

10.710.4		A. M. Castle & Co. Directors Deferred Compensation Plan, as amended and restated as of October 22, 2008. Filed as Exhibit 10.13 to Annual Report on Form 10-K for the period ended December 31, 2008, which was filed on March 12, 2009. Commission File No. 1-5415.

10.810.5		A. M. Castle & Co. Supplemental 401(k) Savings and Retirement Plan, as amended and restated, effective as of January 1, 2009. Filed as Exhibit 10.14 to Annual Report on Form 10-K for the period ended December 31, 2008, which was filed on March 12, 2009. Commission File No. 1-5415.

10.910.6		A. M. Castle & Co. Supplemental Pension Plan, as amended and restated, effective as of January 1, 2009. Filed as Exhibit 10.15 to Annual Report on Form 10-K for the period ended December 31, 2008, which was filed on March 12, 2009. Commission File No. 1-5415.

10.1010.7		First Amendment to the A. M. Castle & Co. Supplemental 401(k) Savings and Retirement Plan, executed April 15, 2009 (as effective April 27, 2009). Filed as Exhibit 10.1 to Form 8-K filed on April 16, 2009. Commission File No. 1-5415.

10.1110.8		Form of A.M. Castle & Co. Indemnification Agreement to be executed with all directors and executive officers. Filed as Exhibit 10.16 to Form 8-K filed on July 29, 2009. Commission File No. 1-5415.

100

10.12*

Exhibit Number		Description of Exhibit
10.9*		Form of Restricted Stock Award Agreement under A. M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.20 to Form 8-K filed on March 24, 2010. Commission File No. 1-5415.

10.1310.10		Form of Performance Share Award Agreement under A. M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.21 to Form 8-K filed on March 24, 2010. Commission File No. 1-5415.

10.1410.11		Form of Incentive Stock Option Award Agreement under A. M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.22 to Form 8-K filed on March 24, 2010. Commission File No. 1-5415.

10.1510.12		Form of Non-Qualified Stock Option Award Agreement under A. M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.23 to Form 8-K filed on March 24, 2010. Commission File No. 1-5415.

10.1610.13		Form of Non-Employee Director Restricted Stock Award Agreement. Filed as Exhibit 10.1 to Form 8-K filed on April 27, 2010. Commission File No. 1-5415.

10.1710.14		Form of Amended and Restated Change of Control Agreement for all executive officers other than the CEO. Filed as Exhibit 10.24 to Form 8-K filed on September 21, 2010. Commission File No. 1-5415.

10.1810.15		Form of Amended and Restated Severance Agreement for executive officers other than the CEO. Filed as Exhibit 10.26 to Form 8-K filed on December 23, 2010. Commission File No. 1-5415.

~~100~~



~~Exhibit~~ ~~Number~~		~~Description of Exhibit~~
10.1910.16		CEO Change in Control Agreement, as amended and restated December 22, 2010. Filed as Exhibit 10.27 to Form 8-K filed on December 23, 2010. Commission File No. 1-5415.

10.2010.17		CEO Employment/Non-Competition Agreement, as amended and restated December 22, 2010. Filed as Exhibit 10.28 to Form 8-K filed on December 23, 2010. Commission File No. 1-5415.

10.2110.18		Form of Performance Share Award Agreement, adopted March 2, 2011, under A.M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.29 to Form 8-K filed March 8, 2011. Commission File No. 1-5415.

10.2210.19		A.M. Castle & Co. 2008 Omnibus Incentive Plan (formerly known as the A.M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan) as Amended and Restated as of April 25, 2013 (incorporated by reference to Appendix A of the Registrant's Definitive Proxy Statement filed with the Commission on March 12, 2013). Commission File No. 1-5415.

10.23*		~~Stephen V. Hooks Executive Retention and Severance Agreement, dated October 27, 2011. Filed as Exhibit 10.31 to Form 8-K filed November 1, 2011. Commission File No. 1-5415.~~

~~10.24~~		Pledge and Security Agreement, dated as of December 15, 2011, by A.M. Castle & Co., and its subsidiaries that are party thereto, in favor of U.S. Bank National Association, as collateral agent, for the benefit of the Secured Parties. Filed as Exhibit 10.1 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.

~~10.25~~		Intercreditor Agreement, dated as of December 15, 2011, among Wells Fargo Bank, National Association, in its capacity as administrative and collateral agent for the First Lien Secured Parties and U.S. Bank National Association, a national banking association, in its capacity as trustee and collateral agend for the Second Lien Secured Parties. Filed as Exhibit 10.2 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.

~~10.26~~		Registration Rights Agreement, dated as of December 15, 2011, between A.M. Castle & Co., the Guarantors and Jefferies & Company, Inc., as initial purchaser, for the benefit of the Holders of the Notes. Filed as Exhibit 10.3 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.

~~10.27~~10.20		Loan and Security Agreement, dated December 15, 2011, by and among A.M. Castle & Co., Transtar Metals Corp., Advanced Fabricating Technology, LLC, Oliver Steel Plate Co., Paramont Machine Company, LLC, Total Plastics, Inc., Tube Supply, LLC, A.M. Castle & Co. (Canada) Inc., Tube Supply Canada ULC, the other Loan Parties party thereto, the lenders which are now or which hereafter become a party thereto, and Wells Fargo Bank, National Association, a national banking association, in its capacity as administrative agent and collateral agent for Secured Parties. Filed as Exhibit 10.4 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.

10.28*10.21		Pledge and Security Agreement, dated as of December 15, 2011, by A.M. Castle & Co., and its subsidiaries that are party thereto, in favor of U.S. Bank National Association, as collateral agent, for the benefit of the Secured Parties. Filed as Exhibit 10.1 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.

10.22		Intercreditor Agreement, dated as of December 15, 2011, among Wells Fargo Bank, National Association, in its capacity as administrative and collateral agent for the First Lien Secured Parties and U.S. Bank National Association, a national banking association, in its capacity as trustee and collateral agent for the Second Lien Secured Parties. Filed as Exhibit 10.2 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.

101



Exhibit Number		Description of Exhibit
10.23		Amendment No. 1 to Loan and Security Agreement, dated as of January 21, 2014, by and among A.M. Castle & Co., Advanced Fabricating Technology, LLC, Paramont Machine Company, LLC, Total Plastics, Inc., A.M. Castle & Co. (Canada) Inc., the financial institutions from time to time party to the Loan Agreement as lenders, and Wells Fargo Bank, National Association, in its capacity as agent. Filed as Exhibit 10.1 to Form 8-K on January 23, 2014. Commission File No. 1-5415.

10.24		Amendment No. 2 to Loan and Security Agreement, dated as of December 10, 2014, by and among A.M. Castle & Co., Advanced Fabricating Technology, LLC, Paramont Machine Company, LLC, Total Plastics, Inc., A.M. Castle & Co. (Canada) Inc., the financial institutions from time to time party to the Loan Agreement as lenders, and Wells Fargo Bank, National Association, in its capacity as agent. Filed as Exhibit 10.2 to Form 8-K on December 11, 2014. Commission File No. 1-5415.

10.25*		Employment Agreement, dated November 9, 2011, by and between A. M. Castle & Co. and Mr. Paul Sorensen. Filed as Exhibit 10.29 to Quarterly Report on Form 10-Q for the period ended June 30, 2012, which was filed on August 7, 2012. Commission File No. 1-5415.

10.2910.26		Form of Retention Bonus Agreement for certain executive officers in connection with CEO leadership transition, dated May 14, 2012. Filed as Exhibit 10.30 to Quarterly Report on Form 10-Q for the period ended June 30, 2012, which was filed on August 7, 2012. Commission File No. 1-5415.

10.3010.27		Amendment to Employment Agreement, dated May 30, 2012, by and between A. M. Castle & Co. and Mr. Paul Sorensen. Filed as Exhibit 10.31 to Quarterly Report on Form 10-Q for the period ended June 30, 2012, which was filed on August 7, 2012. Commission File No. 1-5415.

10.3110.28		Employment Offer Letter dated October 10, 2012, between A.M. Castle & Co. and Mr. Scott Dolan. Filed as Exhibit 10.32 to Form 8-K/A filed October 15, 2012. Commission File No. 1-5415.

10.3210.29		Form of Restricted Stock Unit Award Agreement between A.M. Castle & Co. and Mr. Scott Dolan. Filed as Exhibit 10.33 to Form 8-K/A filed October 15, 2012. Commission File No. 1-5415.

10.3310.30		Form of Severance Agreement between A.M. Castle & Co. and Mr. Scott Dolan. Filed as Exhibit 10.34 to Form 8-K/A filed October 15, 2012. Commission File No. 1-5415.

~~101~~



~~Exhibit~~ ~~Number~~		~~Description of Exhibit~~

10.3410.31		Form of Change of Control Agreement between A.M. Castle & Co. and Mr. Scott Dolan. Filed as Exhibit 10.35 to Form 8-K/A filed October 15, 2012. Commission File No. 1-5415.

10.3510.32		Offer of Chief Commercial Officer dated December 28, 2012, between A.M. Castle & Co. and Mr. Blain Tiffany. Filed as Exhibit 10.36 to Form 8-K filed January 22, 2013. Commission File No. 1-5415.

10.3610.33		Separation Agreement, dated April 26, 2013, by and between A.M. Castle & Co. and Mr. Blain Tiffany. Filed as Exhibit 10.37 to Quarterly Report on Form 10-Q for the period ended June 30, 2013, which was filed on July 31, 2013. Commission File No. 1-5415.

10.3710.34		Employment Offer Letter dated July 1, 2013, between A.M. Castle & Co. and Mr. Stephen Letnich. Filed as Exhibit 10.38 to Quarterly Report on Form 10-Q for the period ended September 30, 2013, which was filed on November 1, 2013. Commission File No. 1-5415.

~~10.38~~10.35*		~~Amendment No. 1 to Loan and Security Agreement,~~Employment Offer Letter dated ~~as of January 21,~~March 7, 2014, ~~by and among~~between A.M. Castle & Co., Advanced Fabricating Technology, LLC, Paramont Machine Company, LLC, Total Palstics, Inc., A.M. Castle & Co. (Canada) Inc., the financial institutions from time to time party to the Loan Agreement as lenders, and ~~Wells Fargo Bank, National Association, in its capacity as agent.~~Mr. Marec Edgar. Filed as Exhibit ~~10.1~~10.39 to Quarterly Report on Form ~~8-K~~10-Q for the period ended March 31, 2014, which was filed on ~~January 23,~~May 1, 2014. Commission File No. 1-5415.

1810.36*		~~Preferability~~Employment Offer Letter ~~Regarding Change in Accounting Principle Relating~~dated September 25, 2014, between A.M. Castle & Co. and Mr. Patrick R. Anderson. Filed as Exhibit 10.40 to ~~Goodwill~~Quarterly Report on Form 10-Q for the period ended September 30, 2014, which was filed on October 29, 2014. Commission File No. 1-5415.

10.37*		Form of Non-Employee Director Restricted Stock Award Agreement, dated December 11, 2014.

10.38*		Amendment of Non-Employee Director Restricted Stock Award Agreements under the 2008 A.M. Castle & Co. Omnibus Incentive Plan, dated December 11, 2014.

102



Exhibit Number		Description of Exhibit
21.1		Subsidiaries of Registrant

23.1		Consent of Deloitte & Touche LLP

23.2		Consent of Grant Thornton LLP

31.1		CEO Certification Pursuant to Section 302 of the Sarbanes Oxley Act of 2002.

31.2		Interim CFO Certification Pursuant to Section 302 of the Sarbanes Oxley Act of 2002.

32.1		CEO and Interim CFO Certification Pursuant to Section 906 of the Sarbanes Oxley Act of 2002.

101.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Calculation Linkbase Document

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		XBRL Taxonomy Label Linkbase Document

101.PRE		XBRL Taxonomy Presentation Linkbase Document



*	These agreements are considered a compensatory plan or arrangement.

~~102~~103

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

A. M. Castle & Co.

(Registrant)



By:		/s/ Patrick R. Anderson
		Patrick R. Anderson, Interim Vice President, Chief
		Financial Officer & Treasurer and Vice President,
		Corporate Controller ~~and~~& Chief Accounting Officer
		(Principal Accounting Officer)

Date:		March ~~7, 2014~~6, 2015

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities as shown following their name on this ~~7th~~6th day of March, ~~2014.~~2015.



/s/ Brian P. Anderson	~~/s/ Gary A. Masse~~
Brian P. Anderson, Chairman of the Board	~~Gary A. Masse, Director~~

/s/ Scott J. Dolan	/s/ ~~Scott F. Stephens~~Patrick R. Anderson	~~/s/ Patrick R. Anderson~~
Scott J. Dolan, President,	~~Scott F. Stephens, Vice President~~	Patrick R. Anderson, Interim Vice ~~President,~~
Chief Executive Officer and	~~and~~President, Chief Financial Officer &	~~Controller and Chief Accounting~~
Director	~~(Principal Financial Officer)~~Treasurer and Vice President,	~~Officer~~
(Principal Executive Officer)	Corporate Controller & Chief
	Accounting Officer
	(Principal Accounting Officer)

/s/ Reuben S. Donnelley	/s/ ~~Patrick~~Terrence J. ~~Herbert, III~~Keating	/s/ ~~Terrence J. Keating~~James D. Kelly
Reuben S. Donnelley, Director	~~Patrick~~Terrence J. ~~Herbert, III,~~Keating, Director	~~Terrence J. Keating,~~James D. Kelly, Director

/s/ ~~James D. Kelly~~Pamela Forbes Lieberman	/s/ ~~Pamela Forbes Lieberman~~Gary A. Masse	/s/ John McCartney
~~James D. Kelly,~~Pamela Forbes Lieberman, Director	~~Pamela Forbes Lieberman,~~Gary A. Masse, Director	John McCartney, Director

/s/ Jonathan B. Mellin
Jonathan B. Mellin, Director

~~103~~104

Exhibit Index

The following exhibits are filed herewith or incorporated herein by reference:



Exhibit No.	Description	Page

~~2.1~~	Stock Purchase Agreement, dated November 9, 2011, by and among A.M. Castle & Co., Mr. Paul Sorensen, Mr. Jerry Willeford, and Tube Supply, Inc. Filed as Exhibit 2.1 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.	—

~~2.2~~	Agreement and Amendment, dated December 15, 2011, by and among A.M. Castle & Co., Mr. Paul Sorensen, Mr. Jerry Willeford, Tube Supply, Inc. and A.M. Castle & Co. (Canada) Inc. Filed as Exhibit 2.2 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.	—

~~2.3~~	Second Amendment to the Stock Purchase Agreement, dated January 13, 2012, by and among A. M. Castle & Co., Mr. Paul Sorensen, Mr. Jerry Willeford, and Tube Supply, LLC (as successor in interest to Tube Supply Inc.). Incorporated by reference to Exhibit 2.3 to the Company's Form S-4/A filed with the SEC on May 25, 2012. Commission File No. 333-180662.	—

~~2.4~~	Third Amendment to the Stock Purchase Agreement, dated May 11, 2012, by and among A. M. Castle & Co., Mr. Paul Sorensen, Mr. Jerry Willeford, and Tube Supply, LLC (as successor in interest to Tube Supply Inc.). Incorporated by reference to Exhibit 2.4 to the Company's Form S-4/A filed with the SEC on May 25, 2012. Commission File No. 333-180662.	—

~~2.5~~	Fourth Amendment to the Stock Purchase Agreement, dated September 13, 2012 by and among A. M. Castle & Co., Mr. Paul Sorensen, Mr. Jerry Willeford, and Tube Supply, LLC (as successor in interest to Tube Supply Inc.). Filed as Exhibit 2.6 to Annual Report on Form 10-K for the period ended December 31, 2012, which was filed on March 11, 2013. Commission File No. 1-5415.	—

~~2.6~~	Fifth Amendment to the Stock Purchase Agreement, dated November 14, 2012 by and among A. M. Castle & Co., Mr. Paul Sorensen, Mr. Jerry Willeford, and Tube Supply, LLC (as successor in interest to Tube Supply Inc.). Filed as Exhibit 2.7 to Annual Report on Form 10-K for the period ended December 31, 2012, which was filed on March 11, 2013. Commission File No. 1-5415.	—

3.1	Articles of Restatement of the Charter of the Company filed with the State Department of Assessments and Taxation of Maryland on April 27, 2012. Filed as Exhibit 3.1 to Quarterly Report on Form 10-Q for the period ended March 31, 2012, which was filed on May 3, 2012. Commission File No. 1-5415.	—

3.2	Articles Supplementary of the Company. Filed as Exhibit 3.1 to Form 8-A filed on September 6, 2012. Commission File No. 1-5415.	—

3.3	Articles Supplementary of A.M. Castle & Co. Filed as Exhibit 3.1 to Form 8-K filed on August 14, 2013. Commission File No. 1-5415.	—

3.4	Amended and Restated Bylaws of A.M. Castle & Co. adopted August 13, 2013. Filed as Exhibit 3.2 to Form 8-K filed on August 14, 2013. Commission File No. 1-5415.	—

4.1	Indenture, dated as of December 15, 2011, among A.M. Castle & Co., the Guarantors, U.S. Bank National Association, as trustee and U.S. Bank National Association, as collateral agent. Filed as Exhibit 4.1 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.	—

4.2	Indenture, dated as of December 15, 2011, between A.M. Castle & Co., the Guarantors and U.S. Bank National Association, as trustee. Filed as Exhibit 4.2 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.	—

4.3	Rights Agreement, dated as of August 31, 2012, by and between A.M. Castle & Co. and American Stock Transfer & Trust Company, LLC, as Rights Agent. Filed as Exhibit 4.1 to Form 8-K filed on August 31, 2012. Commission File No. 1-5415.	—

~~104~~



~~Exhibit No.~~	~~Description~~	~~Page~~
4.4	Amendment No. 1 to Rights Agreement, dated as of August 13, 2013, by and between A.M. Castle & Co. and American Stock Transfer & Trust Company, LLC, as Rights Agent. Filed as Exhibit 4.1 to Form 8-K filed on August 14, 2013. Commission File No. 1-5415.	—

10.1*	A. M. Castle & Co. ~~1995 Director Stock Option Plan. Filed as Exhibit A to Proxy Statement filed March 7, 1995. Commission File No. 1-5415.~~	—

10.2*	~~A. M. Castle & Co. 1996 Restricted Stock and Stock Option Plan. Filed as Exhibit A to Proxy Statement filed March 8, 2006. Commission File No. 1-5415.~~	—

10.3*	~~A. M. Castle & Co. 2000 Restricted Stock and Stock Option Plan. Filed as Appendix B to Proxy Statement filed March 23, 2001. Commission File No. 1-5415.~~	—

10.4*	~~A. M. Castle & Co.~~ 2004 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit D to Proxy Statement filed March 12, 2004. Commission File No. 1-5415.	—

10.510.2	Form of Restricted Stock Award Agreement under A. M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.11 to Annual Report on Form 10-K for the period ended December 31, 2008, which was filed on March 12, 2009. Commission File No. 1-5415.	—

10.610.3	Form of Performance Share Award Agreement under A. M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.12 to Annual Report on Form 10-K for the period ended December 31, 2008, which was filed on March 12, 2009. Commission File No. 1-5415.	—

10.710.4	A. M. Castle & Co. Directors Deferred Compensation Plan, as amended and restated as of October 22, 2008. Filed as Exhibit 10.13 to Annual Report on Form 10-K for the period ended December 31, 2008, which was filed on March 12, 2009. Commission File No. 1-5415.	—

10.810.5	A. M. Castle & Co. Supplemental 401(k) Savings and Retirement Plan, as amended and restated, effective as of January 1, 2009. Filed as Exhibit 10.14 to Annual Report on Form 10-K for the period ended December 31, 2008, which was filed on March 12, 2009. Commission File No. 1-5415.	—

10.910.6	A. M. Castle & Co. Supplemental Pension Plan, as amended and restated, effective as of January 1, 2009. Filed as Exhibit 10.15 to Annual Report on Form 10-K for the period ended December 31, 2008, which was filed on March 12, 2009. Commission File No. 1-5415.	—

105

10.10*

Exhibit No.	Description	Page
10.7*	First Amendment to the A. M. Castle & Co. Supplemental 401(k) Savings and Retirement Plan, executed April 15, 2009 (as effective April 27, 2009). Filed as Exhibit 10.1 to Form 8-K filed on April 16, 2009. Commission File No. 1-5415.	—

10.1110.8	Form of A.M. Castle & Co. Indemnification Agreement to be executed with all directors and executive officers. Filed as Exhibit 10.16 to Form 8-K filed on July 29, 2009. Commission File No. 1-5415.	—

10.1210.9	Form of Restricted Stock Award Agreement under A. M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.20 to Form 8-K filed on March 24, 2010. Commission File No. 1-5415.	—

10.1310.10	Form of Performance Share Award Agreement under A. M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.21 to Form 8-K filed on March 24, 2010. Commission File No. 1-5415.	—

10.1410.11	Form of Incentive Stock Option Award Agreement under A. M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.22 to Form 8-K filed on March 24, 2010. Commission File No. 1-5415.	—

10.1510.12	Form of Non-Qualified Stock Option Award Agreement under A. M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.23 to Form 8-K filed on March 24, 2010. Commission File No. 1-5415.	—

10.1610.13	Form of Non-Employee Director Restricted Stock Award Agreement. Filed as Exhibit 10.1 to Form 8-K filed on April 27, 2010. Commission File No. 1-5415.	—

~~105~~



~~Exhibit No.~~	~~Description~~	~~Page~~
10.1710.14	Form of Amended and Restated Change of Control Agreement for all executive officers other than the CEO. Filed as Exhibit 10.24 to Form 8-K filed on September 21, 2010. Commission File No. 1-5415.	—

10.1810.15	Form of Amended and Restated Severance Agreement for executive officers other than the CEO. Filed as Exhibit 10.26 to Form 8-K filed on December 23, 2010. Commission File No. 1-5415.	—

10.1910.16	CEO Change in Control Agreement, as amended and restated December 22, 2010. Filed as Exhibit 10.27 to Form 8-K filed on December 23, 2010. Commission File No. 1-5415.	—

10.2010.17	CEO Employment/Non-Competition Agreement, as amended and restated December 22, 2010. Filed as Exhibit 10.28 to Form 8-K filed on December 23, 2010. Commission File No. 1-5415.	—

10.2110.18	Form of Performance Share Award Agreement, adopted March 2, 2011, under A.M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan. Filed as Exhibit 10.29 to Form 8-K filed March 8, 2011. Commission File No. 1-5415.	—

10.2210.19	A.M. Castle & Co. 2008 Omnibus Incentive Plan (formerly known as the A.M. Castle & Co. 2008 Restricted Stock, Stock Option and Equity Compensation Plan) as Amended and Restated as of April 25, 2013 (incorporated by reference to Appendix A of the Registrant's Definitive Proxy Statement filed with the Commission on March 12, 2013). Commission File No. 1-5415.	—

10.23*	~~Stephen V. Hooks Executive Retention and Severance Agreement, dated October 27, 2011. Filed as Exhibit 10.31 to Form 8-K filed November 1, 2011. Commission File No. 1-5415.~~	—

~~10.24~~	Pledge and Security Agreement, dated as of December 15, 2011, by A.M. Castle & Co., and its subsidiaries that are party thereto, in favor of U.S. Bank National Association, as collateral agent, for the benefit of the Secured Parties. Filed as Exhibit 10.1 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.	—

~~10.25~~	Intercreditor Agreement, dated as of December 15, 2011, among Wells Fargo Bank, National Association, in its capacity as administrative and collateral agent for the First Lien Secured Parties and U.S. Bank National Association, a national banking association, in its capacity as trustee and collateral agend for the Second Lien Secured Parties. Filed as Exhibit 10.2 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.	—

~~10.26~~	Registration Rights Agreement, dated as of December 15, 2011, between A.M. Castle & Co., the Guarantors and Jefferies & Company, Inc., as initial purchaser, for the benefit of the Holders of the Notes. Filed as Exhibit 10.3 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.	—

~~10.27~~10.20	Loan and Security Agreement, dated December 15, 2011, by and among A.M. Castle & Co., Transtar Metals Corp., Advanced Fabricating Technology, LLC, Oliver Steel Plate Co., Paramont Machine Company, LLC, Total Plastics, Inc., Tube Supply, LLC, A.M. Castle & Co. (Canada) Inc., Tube Supply Canada ULC, the other Loan Parties party thereto, the lenders which are now or which hereafter become a party thereto, and Wells Fargo Bank, National Association, a national banking association, in its capacity as administrative agent and collateral agent for Secured Parties. Filed as Exhibit 10.4 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.	—

10.28*10.21	Pledge and Security Agreement, dated as of December 15, 2011, by A.M. Castle & Co., and its subsidiaries that are party thereto, in favor of U.S. Bank National Association, as collateral agent, for the benefit of the Secured Parties. Filed as Exhibit 10.1 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.	—

106



Exhibit No.	Description	Page
10.22	Intercreditor Agreement, dated as of December 15, 2011, among Wells Fargo Bank, National Association, in its capacity as administrative and collateral agent for the First Lien Secured Parties and U.S. Bank National Association, a national banking association, in its capacity as trustee and collateral agent for the Second Lien Secured Parties. Filed as Exhibit 10.2 to Form 8-K filed November 15, 2011. Commission File No. 1-5415.	—

10.23	Amendment No. 1 to Loan and Security Agreement, dated as of January 21, 2014, by and among A.M. Castle & Co., Advanced Fabricating Technology, LLC, Paramont Machine Company, LLC, Total Plastics, Inc., A.M. Castle & Co. (Canada) Inc., the financial institutions from time to time party to the Loan Agreement as lenders, and Wells Fargo Bank, National Association, in its capacity as agent. Filed as Exhibit 10.1 to Form 8-K on January 23, 2014. Commission File No. 1-5415.	—

10.24	Amendment No. 2 to Loan and Security Agreement, dated as of December 10, 2014, by and among A.M. Castle & Co., Advanced Fabricating Technology, LLC, Paramont Machine Company, LLC, Total Plastics, Inc., A.M. Castle & Co. (Canada) Inc., the financial institutions from time to time party to the Loan Agreement as lenders, and Wells Fargo Bank, National Association, in its capacity as agent. Filed as Exhibit 10.2 to Form 8-K on December 11, 2014. Commission File No. 1-5415.	—

10.25*	Employment Agreement, dated November 9, 2011, by and between A. M. Castle & Co. and Mr. Paul Sorensen. Filed as Exhibit 10.29 to Quarterly Report on Form 10-Q for the period ended June 30, 2012, which was filed on August 7, 2012. Commission File No. 1-5415.	—

10.2910.26	Form of Retention Bonus Agreement for certain executive officers in connection with CEO leadership transition, dated May 14, 2012. Filed as Exhibit 10.30 to Quarterly Report on Form 10-Q for the period ended June 30, 2012, which was filed on August 7, 2012. Commission File No. 1-5415.	—

~~106~~



~~Exhibit No.~~	~~Description~~	~~Page~~
10.3010.27	Amendment to Employment Agreement, dated May 30, 2012, by and between A. M. Castle & Co. and Mr. Paul Sorensen. Filed as Exhibit 10.31 to Quarterly Report on Form 10-Q for the period ended June 30, 2012, which was filed on August 7, 2012. Commission File No. 1-5415.	—

10.3110.28	Employment Offer Letter dated October 10, 2012, between A.M. Castle & Co. and Mr. Scott Dolan. Filed as Exhibit 10.32 to Form 8-K/A filed October 15, 2012. Commission File No. 1-5415.	—

10.3210.29	Form of Restricted Stock Unit Award Agreement between A.M. Castle & Co. and Mr. Scott Dolan. Filed as Exhibit 10.33 to Form 8-K/A filed October 15, 2012. Commission File No. 1-5415.	—

10.3310.30	Form of Severance Agreement between A.M. Castle & Co. and Mr. Scott Dolan. Filed as Exhibit 10.34 to Form 8-K/A filed October 15, 2012. Commission File No. 1-5415.	—

10.3410.31	Form of Change of Control Agreement between A.M. Castle & Co. and Mr. Scott Dolan. Filed as Exhibit 10.35 to Form 8-K/A filed October 15, 2012. Commission File No. 1-5415.	—

10.3510.32	Offer of Chief Commercial Officer dated December 28, 2012, between A.M. Castle & Co. and Mr. Blain Tiffany. Filed as Exhibit 10.36 to Form 8-K filed January 22, 2013. Commission File No. 1-5415.	—

10.3610.33	Separation Agreement, dated April 26, 2013, by and between A.M. Castle & Co. and Mr. Blain Tiffany. Filed as Exhibit 10.37 to Quarterly Report on Form 10-Q for the period ended June 30, 2013, which was filed on July 31, 2013. Commission File No. 1-5415.	—

10.3710.34	Employment Offer Letter dated July 1, 2013, between A.M. Castle & Co. and Mr. Stephen Letnich. Filed as Exhibit 10.38 to Quarterly Report on Form 10-Q for the period ended September 30, 2013, which was filed on November 1, 2013. Commission File No. 1-5415.	—

~~10.38~~10.35*	~~Amendment No. 1 to Loan and Security Agreement,~~Employment Offer Letter dated ~~as of January 21,~~March 7, 2014, ~~by and among~~between A.M. Castle & Co.~~, Advanced Fabricating Technology, LLC, Paramont Machine Company, LLC, Total Palstics, Inc.,~~ and Mr. Marec Edgar. Filed as Exhibit 10.39 to Quarterly Report on Form 10-Q for the period ended March 31, 2014, which was filed on May 1, 2014. Commission File No. 1-5415.	—

107



Exhibit No.	Description	Page
10.36*	Employment Offer Letter dated September 25, 2014, between A.M. Castle & Co. ~~(Canada) Inc., the financial institutions from time to time party to the Loan Agreement as lenders,~~ and ~~Wells Fargo Bank, National Association, in its capacity as agent.~~Mr. Patrick R. Anderson. Filed as Exhibit ~~10.1~~10.40 to Quarterly Report on Form ~~8-K~~10-Q for the period ended September 30, 2014, which was filed on ~~January 23,~~October 29, 2014. Commission File No. 1-5415.	—

1810.37*	~~Preferability Letter Regarding Change in Accounting Principle Relating to Goodwill~~Form of Non-Employee Director Restricted Stock Award Agreement, dated December 11, 2014.	E-1

10.38*	Amendment of Non-Employee Director Restricted Stock Award Agreements under the 2008 A.M. Castle & Co. Omnibus Incentive Plan, dated December 11, 2014.	E-4

21.1	Subsidiaries of Registrant	~~E-2~~E-6

23.1	Consent of Deloitte & Touche LLP	~~E-3~~E-7

23.2	Consent of Grant Thornton LLP	~~E-4~~E-8

31.1	CEO Certification Pursuant to Section 302 of the Sarbanes Oxley Act of 2002.	~~E-5~~E-9

31.2	Interim CFO Certification Pursuant to Section 302 of the Sarbanes Oxley Act of 2002.	~~E-6~~E-10

32.1	CEO and Interim CFO Certification Pursuant to Section 906 of the Sarbanes Oxley Act of 2002.	~~E-7~~E-11

101.INS	XBRL Instance Document	—

101.SCH	XBRL Taxonomy Extension Schema Document	—

101.CAL	XBRL Taxonomy Calculation Linkbase Document	—

101.DEF	XBRL Taxonomy Extension Definition Linkbase Document	—

101.LAB	XBRL Taxonomy Label Linkbase Document	—

101.PRE	XBRL Taxonomy Presentation Linkbase Document	—



*	These agreements are considered a compensatory plan or arrangement.

~~107~~108



Current assets	$	134,817
Property, plant and equipment, net	6,767
Other assets	346
Trade name	7,700
Customer relationships	48,800
Non-compete agreements	1,000
Developed technology	1,400
Goodwill	19,637
Total assets acquired	220,467
Current liabilities	33,211
Long-term liabilities	2,871
Total liabilities assumed	36,082
Total purchase price	$	184,385



	Year ended December 31, 2011 (Unaudited)
Pro forma net sales	$	1,332,176
Pro forma net income	7,033
Pro forma basic net income per share	$	0.31
Pro forma diluted net income per share	0.28



	2013			2012
SHORT-TERM DEBT
Foreign	$	—		$	500
Total short-term debt	—			500
LONG-TERM DEBT
12.75% Senior Secured Notes due December 15, 2016	210,000			225,000
7.0% Convertible Notes due December 15, 2017	57,500			57,500
Revolving Credit Facility due December 15, 2015	—			39,500
Other, primarily capital leases	998			1,400
Total long-term debt	268,498			323,400
Less: unamortized discount	(22,502		)	(26,831		)
Less: current portion	(397		)	(415		)
Total long-term portion	245,599			296,154
TOTAL SHORT-TERM AND LONG-TERM DEBT	$	245,996		$	297,069



	Amount Reclassified from Accumulated Other Comprehensive Loss
Details about Accumulated Other Comprehensive Loss Components	Year ended December 31, 2013
Amortization of defined benefit pension and postretirement items
Prior service cost^(b)	$	(322	)
Actuarial loss ^(b)	(1,919		)
Total before Tax	(2,241		)
Tax benefit	874
Total reclassifications for the period, net of tax	$	(1,367	)



	Charges incurred during the
	Year ended
	December 31, 2013
Employee termination and related benefits	$	2,702
Lease termination costs	1,448
Moving costs associated with plant consolidations	4,487
Other exit costs	366
Inventory write-offs	1,236
Total	$	10,239



			Period Activity
	Balance January 1, 2013		Charges ^(a)		Cash payments			Impairment			Balance December 31, 2013 ^(b)		Cumulative Charges Incurred to Date		Total Charges Expected to be Incurred
October 2013 plant consolidations
Moving costs associated with plant consolidations	$	—	$	312	$	(312	)	$	—		$	—	$	312	$	2,270
Employee termination and related benefits	—		129		—			—			129		129		130
Total October 2013 plant consolidations	—		441		(312		)	—			129		441		2,400
January 2013 restructuring activity
Moving costs associated with plant consolidations	—		4,175		(4,006		)	(169		)	—		4,175		3,500
Employee termination and related benefits	—		2,573		(2,573		)	—			—		2,573		2,200
Lease termination costs	—		1,448		(527		)	—			921		1,448		1,800
Other exit costs	—		366		(366		)	—			—		366		1,250
Inventory write-offs	—		1,236		—			(1,236		)	—		1,236		1,250
Total January 2013 restructuring activity	—		9,798		(7,472		)	(1,405		)	921		9,798		10,000
Total restructuring activity	$	—	$	10,239	$	(7,784	)	$	(1,405	)	$	1,050	$	10,239	$	12,400

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