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Castle A M & Co (CAS) Reaches Settlement Agreement with Raging Capital

Published on June 2, 2016 at 3:40 pm by Insider Monkey Staff in Hedge Funds, News
A recent 13D filing with the Securities and Exchange Commission has revealed that William C. Martin‘s Raging Capital Management has signed an agreement with Castle A M & Co (NYSE:CAS), which among other things, will see Gary A. Masse nominated for re-election as a Director on the company’s board at its 2016 annual meeting. Michael Sheehan and Richard N. Burger will also be nominated for election as Class III directors to the board, while Brian P. Anderson and Reuben S. Donnelley will not stand for re-election. The filing also showed that Raging Capital Management owns 6.05 million shares of Castle A M & Co (NYSE:CAS), including 1.41 million shares underlying 5.25% Senior Secured Convertible Notes due 2019, which account for 18.3% of the company’s outstanding stock. Compared to the previous filing from earlier this month, Raging Capital owns 1,126 fewer shares, which was not enough of a change to affect the percentage of ownership.
William Martin Raging Capital Management

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Castle A.M. & Co. (NYSE:CAS) is a distributor of specialty metal that also provides professional processing services; in its product portfolio can be found stainless steel, titanium, alloy, nickel, carbon, and aluminium. Over the last 12 months, the company’s shares have decreased by 67.98%. For the first quarter of 2016, Castle A.M. & Co. reported a net basic loss per share of $1.56 and revenue of $163.85 million, compared to a net basic loss per share of $0.65 and revenue of $188.54 million for the same period of the previous year. In March, Castle A.M. & Co. (NYSE:CAS) sold its subsidiary Total Plastics Inc. to Prophet Equity of Southlake, Texas for around $55 million in order to cut down its existing debt.
Among the hedge funds followed by Insider Monkey, Raging Capital Management reported the biggest position in Castle A.M. & Co. (NYSE:CAS) as of March 31, worth around $12.5 million, while Mark Cohen’s Stone House Capital disclosed the second-biggest position, valued at $10.8 million. Other investors long the stock were Glenn Russell Dubin’s Highbridge Capital Management, Ken Griffin’s Citadel Investment Group, and John Osterweis’ Osterweis Capital Management. There weren’t any hedge funds that initiated brand new positions in the stock during the first quarter.

You can access the original SEC filing by clicking here.

Ownership Summary Table

Name Sole Voting Power Shared Voting Power Sole Dispositive Power Shared Dispositive Power Aggregate Amount Owned Power Percent of Class
Raging Capital Management 37,555 6,045,519 18,888 6,045,519 6,045,519 18.3%
William C. Martin 18,667 6,045,519 6,045,519 6,045,519 18.3%
Raging Capital Master Fund, Ltd 37,555 0%
Kenneth H. Traub 18,667 Less than 1%
Allan J. Young Less than 1%
Richard N. Burger 0%
Robert L. Lerner 0%

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Page 1 of 12 – SEC Filing

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO § 240.13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
§ 240.13d-2(a)
(Amendment No. 11)1
A. M. Castle & Co.
(Name of Issuer)
Common Stock, $0.01 par value
(Title of Class of Securities)
148411101
(CUSIP Number)
Steve Wolosky, Esq.
Olshan Frome Wolosky LLP
1325 Avenue of the Americas
New York, New York 10019
(212) 451-2300

(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)
May 27, 2016
(Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box ¨.
Note:  Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits.  See § 240.13d-7 for other parties to whom copies are to be sent.
_______________
1              The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

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Page 2 of 12 – SEC Filing

1
NAME OF REPORTING PERSON
Raging Capital Management, LLC
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
  (a) o
  (b) o
3
SEC USE ONLY
4
SOURCE OF FUNDS
AF
5
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
¨
6
CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7
SOLE VOTING POWER
– 0 –
8
SHARED VOTING POWER
6,045,519*
9
SOLE DISPOSITIVE POWER
– 0 –
10
SHARED DISPOSITIVE POWER
6,045,519*
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
6,045,519*
12
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
o
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
 
18.3%
14
TYPE OF REPORTING PERSON
 
IA
* Includes 1,414,724 Shares underlying 5.25% Senior Secured Convertible Notes due 2019.

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Page 3 of 12 – SEC Filing

1
NAME OF REPORTING PERSON
William C. Martin
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
  (a) o
  (b) o
3
SEC USE ONLY
4
SOURCE OF FUNDS
AF
5
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
¨
6
CITIZENSHIP OR PLACE OF ORGANIZATION
USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7
SOLE VOTING POWER
– 0 –
8
SHARED VOTING POWER
6,045,519*
9
SOLE DISPOSITIVE POWER
– 0 –
10
SHARED DISPOSITIVE POWER
6,045,519*
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
6,045,519*
12
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
o
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
 
18.3%
14
TYPE OF REPORTING PERSON
 
HC
* Includes 1,414,724 Shares underlying 5.25% Senior Secured Convertible Notes due 2019.

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Page 4 of 12 – SEC Filing

1
NAME OF REPORTING PERSON
Raging Capital Master Fund, Ltd.
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
  (a) o
  (b) o
3
SEC USE ONLY
4
SOURCE OF FUNDS
 
5
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
¨
6
CITIZENSHIP OR PLACE OF ORGANIZATION
CAYMAN ISLANDS
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7
SOLE VOTING POWER
– 0 –
8
SHARED VOTING POWER
– 0 –
9
SOLE DISPOSITIVE POWER
– 0 –
10
SHARED DISPOSITIVE POWER
– 0 –
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
– 0 –
12
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
o
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
 
0%
14
TYPE OF REPORTING PERSON
 
CO

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Page 5 of 12 – SEC Filing

1
NAME OF REPORTING PERSON
Kenneth H. Traub
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
  (a) o
  (b) o
3
SEC USE ONLY
4
SOURCE OF FUNDS
PF, OO
5
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
¨
6
CITIZENSHIP OR PLACE OF ORGANIZATION
USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7
SOLE VOTING POWER
37,555
8
SHARED VOTING POWER
– 0 –
9
SOLE DISPOSITIVE POWER
18,888
10
SHARED DISPOSITIVE POWER
– 0 –
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
37,555
12
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
o
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
 
Less than 1%
14
TYPE OF REPORTING PERSON
 
IN

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Page 6 of 12 – SEC Filing

1
NAME OF REPORTING PERSON
Allan J. Young
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
  (a) o
  (b) o
3
SEC USE ONLY
4
SOURCE OF FUNDS
OO
5
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
¨
6
CITIZENSHIP OR PLACE OF ORGANIZATION
USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7
SOLE VOTING POWER
18,667
8
SHARED VOTING POWER
– 0 –
9
SOLE DISPOSITIVE POWER
– 0 –
10
SHARED DISPOSITIVE POWER
– 0 –
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
18,667
12
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
o
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
 
Less than 1%
14
TYPE OF REPORTING PERSON
 
IN

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Page 7 of 12 – SEC Filing

1
NAME OF REPORTING PERSON
Richard N. Burger
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
  (a) o
  (b) o
3
SEC USE ONLY
4
SOURCE OF FUNDS
 
5
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
¨
6
CITIZENSHIP OR PLACE OF ORGANIZATION
USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7
SOLE VOTING POWER
– 0 –
8
SHARED VOTING POWER
– 0 –
9
SOLE DISPOSITIVE POWER
– 0 –
10
SHARED DISPOSITIVE POWER
– 0 –
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
– 0 –
12
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
o
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
 
0%
14
TYPE OF REPORTING PERSON
 
IN

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Page 8 of 12 – SEC Filing

1
NAME OF REPORTING PERSON
Robert L. Lerner
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
  (a) o
  (b) o
3
SEC USE ONLY
4
SOURCE OF FUNDS
 
5
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)
¨
6
CITIZENSHIP OR PLACE OF ORGANIZATION
USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7
SOLE VOTING POWER
– 0 –
8
SHARED VOTING POWER
– 0 –
9
SOLE DISPOSITIVE POWER
– 0 –
10
SHARED DISPOSITIVE POWER
– 0 –
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
 
– 0 –
12
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
o
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
 
0%
14
TYPE OF REPORTING PERSON
 
IN

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Page 9 of 12 – SEC Filing

The following constitutes Amendment No. 11 to the Schedule 13D filed by the undersigned (“Amendment No. 11”).  This Amendment No. 11 amends the Schedule 13D as specifically set forth herein.
Item 2.
Identity and Background.
Item 2 is hereby amended to add the following:
On May 27, 2016, Raging Capital, Raging Master, William C. Martin, Kenneth H. Traub, Allan J. Young and Richard N. Burger entered into a Settlement Agreement with the Issuer (the “Settlement Agreement”) in connection with matters relating to the composition of the Board of Directors of the Issuer (the “Board”) and the 2016 annual meeting of stockholders of the Issuer (the “2016 Annual Meeting”).  Additionally, on May 27, 2016, the Reporting Persons terminated the Joint Filing and Solicitation Agreement, dated February 25, 2016.  Accordingly, Richard N. Burger and Robert L. Lerner are no longer members of a Section 13(d) group with each other or with Raging Capital, Raging Master, William C. Martin, Kenneth H. Traub and Allan J. Young.  Richard N. Burger and Robert L. Lerner shall cease to be Reporting Persons immediately after the filing of this Amendment No. 11.  Raging Capital, Raging Master, William C. Martin, Kenneth H. Traub and Allan J. Young will continue to file statements on Schedule 13D with respect to the securities of the Issuer to the extent required by applicable law.
Item 4.
Purpose of Transaction.
Item 4 is hereby amended to add the following:
On May 27, 2016, Raging Capital, Raging Master, William C. Martin, Kenneth H. Traub, Allan J. Young and Richard N. Burger entered into the Settlement Agreement.  Pursuant to the terms of the Settlement Agreement, the Board agreed to nominate Richard N. Burger and Michael Sheehan for election as Class III directors at the 2016 Annual Meeting.  The Board also agreed to nominate Gary A. Masse for re-election as a Class III director at the 2016 Annual Meeting.  Brian P. Anderson and Reuben S. Donnelley will not stand for re-election at the 2016 Annual Meeting.
Raging Capital, Raging Master and Messrs. Martin, Traub, Young and Burger also agreed to customary standstill restrictions during the standstill period beginning on the date of the Settlement Agreement and ending on the date that is one day after the 2018 annual meeting of stockholders of the Issuer.
The foregoing description of the terms and conditions of the Settlement Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Settlement Agreement, which is attached as Exhibit 99.1 hereto and is incorporated herein by reference.
Item 5.
Interest in Securities of the Issuer.
 
Items 5(a)-(c) are hereby amended and restated to read as follows:

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Page 10 of 12 – SEC Filing

(a)           The aggregate percentage of Shares reported owned by each person named herein is based upon 31,656,955 Shares outstanding as of May 20, 2016, which is the total number of Shares outstanding based on information provided by the Issuer.
As of the close of business on the date hereof, by virtue of their relationships with Raging Master, each of Raging Capital and William C. Martin may be deemed to beneficially own (i) 4,630,795 Shares held by Raging Master and (ii) 1,414,724 Shares into which the 5.25% Senior Secured Convertible Notes due 2019 (the “New Convertible Notes”) held by Raging Master are convertible assuming such New Convertible Notes were converted into Shares on the date hereof, constituting in the aggregate approximately 18.3% of the Shares outstanding.
As of the close of business on the date hereof, Kenneth H. Traub directly owned 37,555 Shares (including 18,667 unvested restricted Shares that were awarded to him in his capacity as a director of the Issuer), constituting less than 1% of the Shares outstanding.
As of the close of business on the date hereof, Allan J. Young directly owned 18,667 unvested restricted Shares that were awarded to him in his capacity as a director of the Issuer, constituting less than 1% of the Shares outstanding.
As of the close of business on the date hereof, Richard N. Burger and Robert L. Lerner did not own any Shares.
Each of Raging Capital, Raging Master and Messrs. Martin, Traub and Young, as a member of a “group” with the other for purposes of Rule 13d-5(b)(1) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), may be deemed to beneficially own the securities of the Issuer owned by the other.  The filing of this Schedule 13D shall not be deemed an admission that Raging Capital, Raging Master and Messrs. Martin, Traub and Young are, for purposes of Section 13(d) of the Exchange Act, the beneficial owners of any securities of the Issuer he or it does not directly own.  Each of Raging Capital, Raging Master and Messrs. Martin, Traub and Young specifically disclaims beneficial ownership of the securities of the Issuer reported herein that he or it does not directly own.  Without limiting the foregoing sentence, Raging Master specifically disclaims beneficial ownership of the securities of the Issuer held by it by virtue of its inability to vote or dispose of such securities as a result of the IMA.
(b)           Raging Capital and William C. Martin may be deemed to share the power to vote and dispose of the Shares held by Raging Master.
Kenneth H. Traub has the sole power to vote and dispose of 18,888 Shares directly owned by him and has the sole power to vote the 18,667 unvested restricted Shares directly owned by him.
Allan J. Young has the sole power to vote the 18,667 unvested restricted Shares directly owned by him.
(c)           The Reporting Persons have not entered into any transactions in the securities of the Issuer since the filing of Amendment No. 10 to the Schedule 13D.

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Page 11 of 12 – SEC Filing

Item 6.
Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.
 
Item 6 is hereby amended to add the following:
Reference is made to the Settlement Agreement defined and described in Items 2 and 4 above.
The Joint Filing and Solicitation Agreement was terminated by the Reporting Persons as discussed in Item 2 above.
On May 31, 2016, Raging Capital, Raging Master, William C. Martin, Kenneth H. Traub and Allan J. Young entered into a Joint Filing Agreement in which they agreed to the joint filing on behalf of each of them of statements on Schedule 13D, with respect to securities of the Issuer, to the extent required by applicable law.  A copy of this agreement is attached hereto as Exhibit 99.2 and is incorporated herein by reference.
Item 7.
Material to be Filed as Exhibits.
 
Item 7 is hereby amended to add the following exhibits:
 
99.1
Settlement Agreement by and among A. M. Castle & Co., Raging Capital Management, LLC, Raging Capital Master Fund, Ltd., William C. Martin, Kenneth H. Traub, Allan J. Young and Richard N. Burger, dated May 27, 2016.
 
99.2
Joint Filing Agreement by and among Raging Capital Management, LLC, Raging Capital Master Fund, Ltd., William C. Martin, Kenneth H. Traub and Allan J. Young, dated May 31, 2016.

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Page 12 of 12 – SEC Filing

SIGNATURES
After reasonable inquiry and to the best of his knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.
Dated: May 31, 2016
Raging Capital Master Fund, Ltd.
   
 
By:
Raging Capital Management, LLC
Investment Manager
     
 
By:
/s/ William C. Martin
   
Name:
William C. Martin
   
Title:
Chairman, Chief Investment Officer
and Managing Member
 
Raging Capital Management, LLC
   
 
By:
/s/ William C. Martin
   
Name:
William C. Martin
   
Title:
Chairman, Chief Investment Officer
and Managing Member
 
/s/ William C. Martin
 
William C. Martin
 
/s/ Richard N. Burger
 
Richard N. Burger
 
/s/ Robert L. Lerner
 
Robert L. Lerner
 
/s/ Kenneth H. Traub
 
Kenneth H. Traub
 
/s/ Allan J. Young
 
Allan J. Young

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