UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K


x		ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

ORFor the fiscal year ended

¨December 31, ~~TRANSITION~~2015 ~~REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

~~Commission~~OR ~~File Number: 001-33658~~

~~Horsehead~~¨ ~~Holding~~TRANSITION ~~Corp.~~REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

~~(Exact~~For ~~Name~~the oftransition ~~Registrant~~period asfrom ~~Specified in Its Charter)~~

Delaware		20-0447377
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
4955 Steubenville Pike, Suite 405Pittsburgh, Pennsylvania 15205		(724) 774-1020
(Address of Principal Executive Offices, including Zip Code)		(Registrant’s Telephone Number, Including Area Code)

~~Securities~~Commission ~~registered~~File Number: ~~pursuant~~001-33658 ~~to Section 12(b) of the Act:~~

~~Title~~Horsehead ofHolding ~~each~~Corp. ~~class Name of exchange on which registered~~

~~Common~~(Exact ~~Stock,~~Name ~~par~~of ~~value~~Registrant ~~$0.01~~as ~~per~~Specified ~~share The~~in ~~NASDAQ~~Its ~~Stock~~Charter) ~~Market LLC~~

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


Delaware		20-0447377
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

4955 Steubenville Pike, Suite 405 Pittsburgh, Pennsylvania 15205		(724) 774-1020
(Address of Principal Executive Offices, including Zip Code)		(Registrant’s Telephone Number, Including Area Code)

~~None.~~Securities registered pursuant to Section 12(b) of the Act:

~~Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act~~None. ~~Yes ¨~~ ~~No x~~

~~Indicate~~Securities registered ~~by check mark if the registrant is not required to file reports~~ pursuant to Section ~~13 or Section 15~~ 12(dg) 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 daysNone. ~~Yes x No ¨~~

Indicate by check mark ~~whether~~if the registrant ~~has~~is ~~submitted~~a ~~electronically~~well-known ~~and~~seasoned ~~posted on its corporate Web site~~issuer, ifas ~~any,~~defined ~~every~~in ~~Interactive Data File required to be submitted and posted pursuant to~~ Rule 405 of ~~Regulation S-T (§232.405 of this chapter) during~~ the ~~preceding~~Securities ~~12 months (or for such shorter period that the registrant was required to submit and post such files)~~Act. Yes x¨ No ¨x

Indicate by check mark if ~~disclosure~~the ofregistrant ~~delinquent filers pursuant to Item 405 of Regulation S-K~~ is not ~~contained~~required ~~herein,~~to ~~and~~file ~~will~~reports ~~not~~pursuant ~~be contained,~~ to ~~the~~Section 13 ~~best of the registrant’s knowledge, in definitive proxy~~ or ~~information~~Section 15(d) ~~statements incorporated by reference in Part III~~ of ~~this~~the ~~Form 10-K or any amendment to this Form 10-K~~Act. Yes ¨ No x

Indicate by check mark whether the registrant is(1) has afiled ~~large~~all ~~accelerated~~reports ~~filer,~~required anto ~~accelerated~~be ~~filer,~~filed aby Section 13 ~~non-accelerated~~or ~~filer~~15(d) orof athe ~~smaller~~Securities ~~reporting~~Exchange ~~company.~~Act ~~See~~of 1934 during the ~~definitions~~preceding of12 ~~“large~~months ~~accelerated~~(or ~~filer,”~~for ~~“accelerated~~such ~~filer”~~shorter ~~and~~period ~~“smaller~~that ~~reporting~~the ~~company”~~registrant inwas ~~Rule~~required ~~12b-2~~to offile ~~the~~such ~~Exchange~~reports), ~~Act~~and (~~Check one~~2) has been subject to such filing requirements for the past 90 days. Yes ¨ No x

~~Large~~Indicate ~~accelerated~~by ~~Filer~~check xmark ~~Accelerated~~whether ~~filer~~the ¨registrant ~~Non~~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-~~accelerated~~T ~~filer~~(§232.405 ¨of ~~Smaller~~this ~~reporting~~chapter) ~~company~~during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ¨ No x

Indicate by check mark ~~whether~~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 the registrant’s isknowledge, ain ~~shell~~definitive ~~company~~proxy ~~(as~~or ~~defined~~information statements in ~~Rule~~Part ~~12b-2~~III of ~~the~~this ~~Exchange~~Form ~~Act)~~10-K or any amendment to this Form 10-K. ~~Yes~~ ~~¨ No~~ x

AsIndicate ofby ~~June~~check ~~30,~~mark ~~2014,~~whether the registrant ~~aggregate~~is ~~market~~a ~~value~~large ofaccelerated ~~the~~filer, ~~registrant's~~an ~~common~~accelerated ~~stock~~filer, ~~held~~a by non-~~affiliates~~accelerated offiler ~~the~~or ~~registrant~~a ~~was~~smaller ~~approximately~~reporting ~~$801~~company. ~~million~~See ~~(based upon~~ the ~~closing~~definitions ~~sale price~~ of ~~the~~“large ~~common~~accelerated ~~stock on that date on The NASDAQ Global Select Market). For this purpose~~filer,” ~~all~~“accelerated ~~shares~~filer” ~~held by directors, executive officers~~ and ~~stockholders~~“smaller ~~beneficially~~reporting company” ~~owning~~in ~~ten~~Rule ~~percent~~12b-2 ~~or more~~ of the ~~registrant's~~Exchange ~~common~~Act ~~stock~~(Check ~~have been treated as held by affiliates~~one).

~~The~~Large accelerated Filer x Accelerated filer ¨ Non-accelerated ~~number~~filer ¨ Smaller reporting company ¨ ~~of shares of the registrant’s common stock outstanding as of February 26, 2015 was 56,655,577.~~

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

~~Portions~~As of June 30, 2015, the ~~registrant's~~aggregate ~~definitive~~market ~~proxy~~value ~~statement~~of ~~for~~the ~~its~~registrant’s ~~2015~~common ~~annual~~stock ~~meeting~~held by non-affiliates of ~~stockholders,~~the ~~which~~registrant iswas ~~expected~~approximately to$584 bemillion ~~filed~~(based ~~with~~upon the ~~Securities~~closing ~~and~~sale ~~Exchange~~price ~~Commission~~of ~~not~~the ~~later~~common ~~than~~stock ~~March 26,~~on ~~2015~~that ~~are~~date ~~incorporated~~on byThe ~~reference~~NASDAQ ~~into~~Global Select ~~Part~~Market, ~~III~~the ofexchange ~~this~~on ~~report~~which onthe ~~Form~~common ~~10-K. In~~stock ~~the~~traded ~~event~~as of such ~~proxy~~date). ~~statement~~For isthis ~~not~~purpose, ~~filed~~all shares held by ~~March 26~~directors, ~~2015,~~executive ~~the~~officers ~~required~~and ~~information~~stockholders ~~will~~beneficially beowning ~~filed~~ten aspercent anor ~~amendment~~more toof ~~this~~the ~~report~~registrant’s oncommon ~~Form~~stock ~~10-K~~have been notreated ~~later~~as ~~than~~held ~~that~~by ~~date~~affiliates.

~~Table~~The number of ~~Contents~~shares of the registrant’s common stock outstanding as of September 29, 2016 was 60,352,479.

TABLETable OFof CONTENTSContents

PART I
Item 1.	Business	1
	Item 1A. Risk Factors	20
	Item 1B. Unresolved Staff Comments	31
Item 2	Properties	31
Item 3	Legal Proceedings	32
Item 4	Mine Safety Disclosures	32
PART II
Item 5	Market for Registrant's Common Equity, Related Stockholders Matters and Issuer Purchases of Equity Securities	32
Item 6	Selected Financial Data	36
Item 7	Management's Discussion and Analysis of Financial Condition and Results of Operation	37
Item 8	Consolidated Financial Statements and Supplementary Data	66
Item 9	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	66
	Item 9A. Controls and Procedures	66
	Item 9B. Other Information	68
PART III
Item 10	Directors, Executive Officers and Corporate Governance	68
Item 11	Executive Compensation	68
Item 12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	68
Item 13	Certain Relationships and Related Transactions and Director Independence	68
Item 14	Principal Accountant Fees and Services	68
PART IV
Item 15	Exhibits and Financial Statement Schedules	69
EXHIBIT INDEX		E-1

Table of Contents


PART I
Item 1.	Business	1
	Item 1A. Risk Factors	13
	Item 1B. Unresolved Staff Comments	21

Item 2	Properties	21

Item 3	Legal Proceedings	22

Item 4	Mine Safety Disclosures	23

PART II

Item 5	Market for Registrant’s Common Equity, Related Stockholders Matters and Issuer Purchases of Equity Securities	24

Item 6	Selected Financial Data	28

Item 7	Management’s Discussion and Analysis of Financial Condition and Results of Operation	29

Item 8	Consolidated Financial Statements and Supplementary Data	53

Item 9	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	53
	Item 9A. Controls and Procedures	54
	Item 9B. Other Information	57

PART III
Item 10	Directors, Executive Officers and Corporate Governance	58

Item 11	Executive Compensation	63

Item 12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	74

Item 13	Certain Relationships and Related Transactions and Director Independence	75

Item 14	Principal Accountant Fees and Services	75

PART IV
Item 15	Exhibits and Financial Statement Schedules	77

EXHIBIT INDEX		E-1

~~Table~~i ~~of Contents~~

CAUTIONARYTable STATEMENTof FOR PURPOSES OF THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 Contents

~~This~~CAUTIONARY ~~report~~STATEMENT ~~contains~~FOR ~~forward-looking~~PURPOSES ~~statements~~OF ~~within~~THE ~~the~~SAFE ~~meaning~~HARBOR ofPROVISIONS ~~the~~OF ~~federal~~THE ~~securities~~PRIVATE ~~laws.~~SECURITIES LITIGATION ~~These~~REFORM ~~statements~~ACT ~~relate~~OF to1995 analyses and other information, which are based on forecasts of future results and estimates of amounts not yet determinable. These statements also relate to our future prospects, developments and business strategies.

~~These~~This forward looking statements are identified by the use of terms and phrases such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “intend”, “may”, “plan”, “predict”, “project”, and similar terms and phrases, including references to assumptions. However, these words are not the exclusive means of identifying such statements. These statements are contained in many sections of this report ~~(including~~contains “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations”). Although we believe that our plans, intentions and expectations reflected in or suggested by such forward-looking statements ~~are~~within ~~reasonable, we cannot assure you that we will achieve those plans, intentions or expectations. We believe that~~ the ~~following~~meaning ~~factors,~~of ~~among others (including those described in “Part I, Item 1A. Risk Factors”), could affect our future performance and~~ the ~~liquidity and value of our~~ federal securities ~~and~~laws. ~~cause~~These ~~our~~statements ~~actual~~relate ~~results~~ to ~~differ~~analyses ~~materially from those expressed or implied by forward-looking statements made by us or on our behalf: the cyclical nature of the metals industry; the state of the credit~~ and ~~financial~~other ~~markets; decreases in the prices of zinc~~information, ~~silver~~which ~~and~~are ~~nickel-~~based ~~products;~~on ~~competition~~forecasts ~~from global zinc and nickel manufacturers; our ability to implement our business strategy successfully; our ability to ramp-up production at our new zinc facility, and the timing and cost~~ of ~~the~~future ~~ramp-up;~~results our ability to realize the projected benefits from the new zinc facility once fully operational; our ability to obtain silver from the co-product recovery circuit; our ability to produce Special High Grade zinc; our ability to service our debt; our ability to integrate acquired businesses; work stoppages and ~~labor~~estimates ~~disputes; material disruptions at any~~ of ~~our~~amounts ~~manufacturing~~not ~~facilities,~~yet ~~including~~determinable. ~~for~~These ~~equipment,~~statements ~~power~~also ~~failures~~relate ~~or industrial accidents; decreases in order volume from major customers; the costs of compliance with environmental, health and safety laws and responding~~ to ~~potential liabilities and changes under these laws; the effect of litigation related to worker safety or employment laws; failure of~~ our ~~hedging~~future ~~strategies~~prospects, ~~including~~developments ~~those relating to the prices of energy, raw materials~~ and zinc products; our ability to attract and retain key personnel; our ability to protect our intellectual property and know-how; our dependence on third parties for transportation services; and risks associated with our substantial indebtedness and limitations in our debt documentsbusiness strategies.

~~There~~These ~~may~~forward belooking ~~other~~statements ~~factors~~are ~~that~~identified by the use of terms and phrases such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “intend”, “may”, ~~cause~~“plan”, ~~our~~“predict”, ~~actual~~“project”, ~~results~~and similar terms and phrases, including references to ~~differ~~assumptions. ~~materially~~However, ~~from~~these words are not the exclusive means of identifying such statements. These statements are contained in many sections of this report (including “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations”). Although we believe that our plans, intentions and expectations reflected in or suggested by such forward-looking statements. ~~Our~~are ~~actual~~reasonable, ~~results~~we cannot assure you that we will achieve those plans, ~~performance~~intentions or ~~achievements~~expectations. We believe that the following factors, among others (including those described in “Part I, Item 1A. Risk Factors”), could ~~differ~~affect our future performance and cause our actual results to differ materially from those expressed ~~in,~~ or implied by, ~~the~~ forward-looking statements. Wemade ~~can~~by ~~give~~us noor ~~assurances~~on ~~that~~our ~~any~~behalf: our filing of voluntary petitions for relief under the ~~events~~Bankruptcy ~~anticipated~~Code byand the ~~forward-looking~~attendant ~~statements~~difficulties ~~will~~of ~~occur~~operating ~~or,~~our ifbusiness ~~any~~while ofattempting ~~them~~to reorganize ~~does,~~in ~~what~~bankruptcy; ~~impact~~our ~~they~~ability ~~will~~to ~~have~~maintain onsufficient financing sources to fund our ~~results~~business and meet obligations during the Chapter 11 Cases; our ability to secure confirmation of ~~operations~~the Plan and ~~financial~~emerge ~~condition.~~from ~~You~~bankruptcy; ~~should~~our ~~carefully~~ability ~~read~~to ~~the~~continue as ~~factors~~a ~~described~~going inconcern and the ~~“Risk~~uncertainty ~~Factors”~~regarding ~~section~~the eventual outcome of ~~this~~our ~~report~~restructuring; ~~for~~our aability ~~description~~to implement our business plan and financial restructuring strategy successfully; declines in the prices of ~~certain~~zinc ~~risks~~and ~~that~~nickel-based ~~could,~~products; ~~among~~our ability ~~other~~to ~~things,~~resolve ~~cause~~the operational issues at our ~~actual~~idled ~~results~~Mooresboro facility if it resumes operations and if it becomes fully operational; our ability to ~~differ~~produce Special High Grade zinc; our ability to reduce certain operating costs; the cyclical nature of the metals industry; and competition from ~~these~~global ~~forward-looking~~zinc ~~statements~~and nickel manufacturers.

~~All~~There may be other factors that may cause our actual results to differ materially from the forward-looking statements. ~~are~~Our ~~qualified~~actual results, performance or achievements could differ materially from those expressed in, ~~their~~or ~~entirety~~implied by, ~~this~~the ~~cautionary~~forward-looking ~~statement,~~statements. ~~and~~We wecan ~~undertake~~give no assurances ~~obligation~~that toany ~~revise~~of the events anticipated by the forward-looking statements will occur or, ~~update~~if ~~this~~any ~~Annual~~of ~~Report~~them does, what impact they will have on ~~Form~~our ~~10-K~~results toof ~~reflect~~operations ~~events~~and orfinancial ~~circumstances~~condition. ~~after~~You should carefully read the ~~date~~factors ~~hereof~~described in the “Risk Factors” section of this report for a description of certain risks that could, among other things, cause our actual results to differ from these forward-looking statements.

iiAll forward-looking statements are qualified in their entirety by this cautionary statement, and we undertake no obligation to revise or update this Annual Report on Form 10-K to reflect events or circumstances after the date hereof.

~~Table~~ii ~~of Contents~~

PARTTable Iof Contents

~~ITEM~~PART ~~1. BUSINESS~~I

~~Horsehead~~ITEM ~~Holding Corp~~1. is the parent company of Horsehead Corporation, a leading U.S. producer of zinc metal and a leading recycler of electric arc furnace ("EAF") dust ("Horsehead"), The International Metals Reclamation Company, LLC, a leading recycler of nickel-bearing wastes and nickel-cadmium (“Ni-Cd”) batteries in North America (“INMETCO”) and Zochem Inc., a leading producer of zinc oxide in North America ("Zochem"). Horsehead is the parent company of Horsehead Metal Products, LLC which owns and operates our recently completed new zinc facility in Mooresboro, North Carolina. We currently have production and/or recycling operations at six facilities located in five states in the United States. Zochem operates from one facility located in Canada. BUSINESS

~~Our~~Unless ~~products~~stated ~~are~~otherwise ~~used~~or inunless athe ~~wide~~context ~~variety~~otherwise ~~of applications~~requires, ~~including~~all references in ~~the~~this ~~galvanizing~~annual ofreport ~~sheet~~to ~~and fabricated steel products~~the “Company,” ~~as components in rubber tires~~“we,” ~~alkaline batteries~~“our,” ~~paint, chemicals~~ and ~~pharmaceuticals~~“us” ~~and as a remelt alloy in the production of stainless steel. We believe we~~ are ~~the~~to ~~largest~~Horsehead ~~single-site~~Holding ~~producer of zinc oxide in North America~~Corp. ~~We believe we are also the largest North American recycler of EAF dust~~, a ~~hazardous~~Delaware ~~waste produced by the carbon steel mini-mill manufacturing process. Through our INMETCO operations~~corporation, ~~we believe we are also a leading recycler of EAF dust~~ and ~~other~~its ~~nickel-bearing~~consolidated ~~waste generated by specialty steel producers and a leading recycler of Ni-Cd batteries and other types of batteries in North America~~subsidiaries.

~~While~~Company weOverview vary our raw material inputs, or feedstocks, based on cost and availability, our zinc products produced at our new zinc facility in Mooresboro, North Carolina and our nickel products produced at our INMETCO facility, use 100% recycled materials, including, in the case of our zinc products, zinc recovered from our four EAF dust recycling operations located in four states. Our EAF dust recycling facilities generate service fee revenue from steel mini-mills by providing a convenient and safe means for recycling their EAF dust. We believe that our ability to convert recycled zinc into finished products results in lower feed costs than for smelters that rely primarily on zinc concentrates. We produce zinc products at our Brampton, Ontario, Canada facility utilizing Special High Grade ("SHG") zinc metal as raw material feedstock. INMETCO provides recycling services, some of which are on a tolling basis, from a single production facility in Ellwood City, Pennsylvania.

~~We,~~Horsehead ~~together~~Holding ~~with~~Corp. ~~our~~is ~~predecessors~~the parent company of: (i) Horsehead Corporation, ~~have~~a ~~been~~U.S. ~~operating~~producer inof zinc products and, we believe, the ~~zinc~~largest ~~industry~~North ~~for~~American ~~more~~recycler ~~than~~of ~~150~~electric arc furnace (“EAF”) dust (“Horsehead”); (ii) ~~years~~The International Metals Reclamation Company, LLC, a leading recycler of nickel-bearing wastes and nickel-cadmium (“Ni-Cd”) batteries in North America (“INMETCO”); and (iii) Zochem Inc., which we believe is the ~~nickel~~largest single-~~bearing~~site ~~waste~~producer ~~industry~~of ~~for~~zinc ~~more~~oxide ~~than~~in 30North ~~years~~America (“Zochem”). We ~~operate~~Horsehead asis ~~three~~the ~~business~~parent ~~segments,~~company of Horsehead Metal Products, ~~INMETCO~~LLC, ~~and~~which ~~Zochem~~owns our idled zinc facility in Mooresboro, North Carolina.

~~During~~We ~~the~~currently ~~year~~have ~~ended~~production and/or ~~December~~recycling ~~31,~~operations ~~2014,~~at wefive ~~sold~~facilities ~~approximately~~(excluding ~~258.0~~the ~~million~~Mooresboro ~~pounds~~facility) oflocated ~~zinc~~in ~~finished~~four ~~products,~~states ~~195.0~~in ~~million~~the ~~pounds~~United ofStates. ~~waelz~~Zochem ~~oxide~~operates ~~and~~from ~~zinc~~one ~~calcine~~facility ~~and~~located 21in Canada.0 ~~million~~Our ~~pounds~~products ofare ~~nickel-based~~used ~~products,~~in ~~generally~~a ~~priced~~wide atvariety ~~amounts~~of ~~based~~applications, onincluding in ~~zinc~~the ~~and~~galvanizing ~~nickel~~of ~~prices~~sheet onand ~~the~~fabricated ~~London~~steel ~~Metals~~products, ~~Exchange~~as ~~(“LME”).~~components ~~For~~in ~~the~~rubber ~~year~~tires, ~~ended~~alkaline ~~December 31~~batteries, ~~2014~~paint, wechemicals ~~generated~~and ~~sales~~pharmaceuticals and ~~recorded~~as a ~~net~~remelt ~~loss~~alloy ofin ~~$453.9~~the ~~million and~~production ~~$15.5~~of ~~million,~~stainless ~~respectively~~steel.

~~In September of 2011~~We, wetogether ~~began~~with ~~construction on a new, state-of-the-art zinc facility located in Mooresboro, North Carolina to replace~~ our ~~Monaca~~predecessors, ~~Pennsylvania~~have ~~facility. We~~been ~~began~~operating ~~production at our new zinc facility~~ in ~~May 2014. Our new facility provides us with~~ the ~~capability to produce SHG~~ zinc, ~~Continuous~~industry ~~Galvanizing~~for ~~Grade~~more ~~("CGG")~~than ~~zinc~~150 years and ~~High Grade zinc,~~ in ~~addition to~~ the nickel-bearing ~~Prime~~waste ~~Western~~industry ~~("PW")~~for ~~zinc~~more ~~that~~than we30 ~~produced~~years. atOn ~~our~~January 22, ~~former Monaca~~2016, ~~Pennsylvania~~we ~~facility. The~~announced ~~first~~the ~~month~~idling of ~~operation of~~ our ~~new facility validated that the process as designed~~Mooresboro, isNorth ~~capable~~Carolina ofzinc ~~producing~~production ~~SHG~~facility. ~~quality~~The ~~electrolyte~~decision ~~from~~to ~~waelz~~idle ~~oxide ("WOX") using~~ the ~~solvent~~Mooresboro ~~extraction process. The new~~ facility's ~~design~~was ~~relies~~the ~~upon~~result ~~sustainable~~of ~~manufacturing~~many ~~practices~~factors, including toa ~~produce~~depressed zinc ~~solely~~price ~~from recycled materials~~ and ~~uses~~our ~~significantly~~liquidity ~~less~~situation. ~~fossil~~A ~~fuel~~small ~~than~~workforce ~~our~~has ~~former~~been ~~Monaca,~~retained ~~Pennsylvania facility, allowing us~~ to ~~significantly~~manage ~~reduce~~the ~~emissions~~facility. ofTo ~~greenhouse~~date, ~~gases~~the ~~("GHGs")~~Mooresboro ~~and~~facility ~~particulates~~remains ~~into~~in ~~the~~an ~~atmosphere~~idled state.

During ~~We believe that~~ the ~~new~~year ~~facility,~~ended ~~once fully operational~~December 31, ~~will provide us with a number of substantial benefits~~2015, ~~including~~we ~~reduced~~sold ~~manufacturing~~approximately ~~conversion~~243 million ~~costs~~pounds ~~due to the lower energy cost; higher labor productivity; reduced operating maintenance costs; and lower operating costs in our EAF dust recycling plants resulting from the elimination~~ of ~~the~~zinc ~~need~~finished toproducts, 222 million ~~calcine~~pounds ~~the majority~~ of ~~our~~waelz ~~WOX~~oxide ~~prior to its use. We believe that the new zinc facility's capability to convert~~ (“WOX”) and ~~other recycled materials into SHG~~ zinc calcine and ~~other~~24 million ~~grades~~pounds ~~will~~of ~~allow~~nickel-based ~~us to expand into new markets~~products, ~~including~~generally ~~selling~~priced toat ~~continuous~~amounts ~~galvanizers,~~based ~~which~~on ~~include~~zinc ~~some of our EAF dust customers, die casters~~ and ~~potentially~~nickel ~~LME~~prices ~~warehouses,~~on ~~while~~the ~~continuing~~London toMetals ~~serve~~Exchange ~~customers in our existing markets~~(“LME”). InFor ~~addition,~~ the ~~new~~year ended ~~technology~~December 31, ~~will~~2015, ~~also~~we ~~allow~~generated ussales toand ~~recover~~recorded ~~value~~a ~~from~~net ~~certain~~loss ~~metals~~of ~~such~~$414.9 ~~as silver~~ million and ~~lead from WOX produced from EAF dust recycling~~$665.4 ~~The new zinc facility replaced our zinc smelter in Monaca~~million, ~~Pennsylvania, which was permanently shut down in April 2014~~respectively. ~~The~~ ~~former Monaca smelter was over eighty years old and utilized a higher-cost pyrometallurgical process.~~

WeChapter ~~also~~11 Bankruptcy ~~believe~~Filings that additional benefits may be realized once the new facility is fully operational. These additional benefits include a reduction in the cost of hedging the price of zinc, which averaged $9.1 million per year for the period from 2008 to 2013

1On February 2, 2016 (the “Petition Date”), Horsehead Holding Corp. and certain of its direct and indirect wholly owned subsidiaries (collectively, the “Debtors”), filed voluntary petitions (the “Bankruptcy Petitions”) under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). On the same date, Zochem, as foreign representative of the Debtors, commenced a proceeding under Part IV of the Companies’ Creditors Arrangement Act in the Ontario Superior Court of Justice (Commercial List) (the “Canadian Court”) to recognize the Debtors’ Chapter 11 cases as a foreign main proceeding (the “Canadian Proceedings”). The Chapter 11 cases are being jointly administered by the Bankruptcy Court under the caption In re Horsehead Holding Corp., Case No. 16-10287 (the “Chapter 11 Cases”). The Debtors entered Chapter 11 to protect their assets and to formulate a balance sheet restructuring and deleveraging of the Debtors’ current capital structure. The Debtors continue to operate as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court.

~~Table~~On March 3, 2016, the Bankruptcy Court entered a final order approving the Debtors’ debtor-in-possession financing in an aggregate principal amount of ~~Contents~~up to $90 million (the “DIP Facility”) set forth in a debtor-in-possession Credit Agreement (as amended from time to time, the “DIP Credit Agreement”) and the Canadian Court entered an order recognizing and giving effect to the Bankruptcy Court’s order in Canada.

~~(the~~The ~~last~~Debtors ~~full~~have ~~year~~filed a plan of reorganization ~~production~~(as atmay ~~our~~be ~~Monaca~~amended, ~~Pennsylvania~~modified ~~facility~~or supplemented from time to time, the “Plan”) and a related proposed disclosure statement (as may be amended, ~~reduced~~modified ~~maintenance~~or ~~capital~~supplemented ~~spending~~from time to time, ~~which~~the ~~averaged~~“Disclosure $7Statement”) with the Bankruptcy Court.8 ~~million~~On ~~per~~July 11, ~~year~~2016, atthe ~~our~~Bankruptcy ~~Monaca~~Court ~~facility~~entered ~~for~~an order approving the ~~period~~Disclosure ~~from~~Statement, ~~2007~~and toon ~~2012~~July 12, (2016, the ~~last~~Canadian ~~year~~Court ~~significant~~recognized ~~capital~~and ~~expenditures~~gave ~~were~~effect ~~made~~to atsuch ~~our~~order ~~Monaca~~in ~~facility)~~Canada. ~~and~~On ~~reduced~~or ~~state~~about ~~income~~July 18, 2016, ~~taxes~~the asDebtors acommenced ~~result~~solicitation of ~~certain~~the ~~tax~~Plan. ~~incentives~~On ~~available~~September as9, a2016, ~~result~~the ofBankruptcy Court entered an order confirming the ~~investment~~Plan inand on September 12, 2016, the ~~new~~Canadian ~~zinc~~Court ~~facility~~recognized and gave effect to such order in Canada.

~~Our~~1 new zinc facility currently in the ramp-up stage has experienced operational difficulties that we believe are typical of a start-up of this size which have resulted in production interruptions. Numerous improvements have been made to remediate these issues and improve the ramp-up rate. The primary bottleneck thus far has been the removal of solids at the front end of the process. This is conventional technology used extensively in hydrometallurgical and mining applications, thus we anticipate that this issue will be resolved. We have made progress through better control of the process and improvements in equipment reliability. We have not identified any insurmountable technical or operational obstacles that materially challenge the value proposition of our new zinc facility. However, issues such as the removal of solids described above have slowed the ramp-up rate and delayed the realization of the benefits we believe we can obtain from full operation of our zinc facility. The facility operated continuously since early August 2014 after a shutdown during the month of July 2014. On January 5, 2015, we reported that the facility produced approximately 12,000 tons of zinc metal in the fourth quarter of 2014 (with approximately 5,400 tons produced in December), compared to approximately 4,300 tons in the third quarter of 2014 and approximately 3,400 tons in the second quarter of 2014. During January 2015, we produced approximately 4,600 tons of zinc metal. We reduced the plating rate for several days in January to perform some needed maintenance in the cell house. We also experienced intermittent equipment reliability issues, particularly with some key pumps, which were further exacerbated by recent extreme cold weather conditions. On February 20, 2015, we began a planned seven day outage to address several of these issues. We expect to ramp-up production following this outage. Our interim target is to demonstrate that no bottlenecks exist to operating the facility at 75% of nameplate capacity, or 330 tons per day, by the end of the first quarter of 2015. We believe that our ability to achieve this higher level of production will depend primarily on the absence of further unplanned equipment issues. Once fully operational, we expect the new zinc facility to be capable of producing over 155,000 tons of zinc metal per year with equipment capable of producing over 170,000 tons of zinc metal per year without significant additional investment. Timing, however, for the completion of the ramp-up to full production cannot be determined with any certainty at this time.

InTable connection with the start of operations at our new zinc facility, we permanently closed our Monaca, Pennsylvania facility in April 2014. Our Monaca, Pennsylvania facility is under contract to be sold to Shell Chemical LP (“Shell”) pursuant to an option to purchase granted in March 2012 that was exercised on November 7, 2014. A large majority of the demolition at the site has been completed at Shell’s expense. We will retain ownership of a non-hazardous captive landfill located at that site and we are currently in the process of separating our National Pollutant Discharge Elimination System permit into two permits, one to be held by Shell for the portion of the site that would be acquired by Shell and a separate one held by us for our continuing operation of the landfill.Contents

~~Competitive~~On ~~Strengths~~July 11, 2016, we, on behalf of the Debtors, entered into a Unit Purchase and Support Agreement (the “UPA”) with certain holders of claims against the Debtors that are listed therein as plan sponsors (collectively, the “Plan Sponsors”). The UPA was entered into in connection with the Debtors’ Plan filed with the Bankruptcy Court.

~~Leading~~Pursuant ~~Market~~to ~~Positions~~the UPA, and ~~Strategically~~subject ~~Located~~to ~~Recycling~~approvals, ~~Facilities~~terms, and conditions set forth therein, upon emergence from Chapter 11, (i) we will issue units of limited liability company interests of the reorganized Company to the Plan Sponsors who will purchase such Plan Sponsor’s respective percentage of an aggregate amount equal to $160 million (the “Emergence Equity Units”), and (ii) the Plan Sponsors had the right to elect, on or prior to July 29, 2016, to commit to purchase up to an additional $100 million units of limited liability company interests of the reorganized Company (the “Additional Capital Commitment Units”), with such commitment being exercisable at the election of the reorganized Company’s board of directors pursuant to the terms and subject to the conditions of the UPA, following the effectiveness of the Plan. The additional capital commitment was fully subscribed.

WeThe ~~believe~~UPA ~~that~~was weapproved ~~are a leading recycler of nickel-bearing waste material generated~~ by the ~~stainless~~Bankruptcy ~~and~~Court ~~specialty~~on ~~steel~~September ~~industry and a leading recycler of nickel-bearing batteries. Before closing our Monaca~~9, ~~Pennsylvania~~2016 ~~facility,~~and weon ~~were~~September ~~the largest producer of zinc metal by capacity in the United States; we believe that our new zinc facility~~12, ~~once fully operational~~2016, ~~will exceed~~ the ~~capacity~~Canadian ofCourt ~~the~~recognized ~~former Monaca facility. In addition, we believe that we are the largest North American recycler of EAF dust~~ and ~~that~~gave weeffect currently recycle more than half of all EAF dust generated in the United States. Our four company-owned EAF dust recycling facilities are strategically located near major EAF operators, reducing transportation costs and enhancing our ability to ~~compete~~such ~~effectively with other means of EAF dust disposal~~order. We believe that the location of our facilities, together with our long-term EAF dust contracts with several of our customers, competitive cost position, extensive zinc distribution network and proprietary market knowledge, will enable us to maintain our leading market positions and continue to capture market share in zinc products, zinc recycling and nickel-bearing waste recycling.

~~Strong~~The UPA was amended on August 30, ~~Long-Standing~~2016, ~~Relationships~~to, ~~with~~among ~~Diverse~~other ~~Customer~~things, ~~Base~~(i) add an additional Plan Sponsor as a signatory to the UPA and correspondingly amends the respective schedules and purchase commitments to reflect such addition, (ii) allow the reorganized Company to call up to $15 million of Additional Capital Commitment Units for working capital needs and other general purposes, and (iii) amend various provisions of the UPA to reflect, among other milestone changes, that the effective date of the Plan shall occur by 5:00 PM, New York City time, on September 30, 2016.

WeOur ~~believe~~ability ~~that our product quality, reputation for on-time delivery and competitive pricing enable us~~ to ~~maintain~~continue ~~strong~~as ~~relationships with~~ a ~~broad~~going ~~base~~concern ofis ~~customers~~dependent inon ~~each~~many ~~of our end markets. For example~~factors, weincluding ~~believe that before closing~~ our ~~Monaca,~~ability ~~Pennsylvania~~to ~~facility,~~maintain weadequate ~~were~~cash ~~the~~on hand ~~leading~~and ~~supplier~~generate ofcash ~~zinc~~from ~~metal~~operations tofor the ~~after-fabrication~~duration ~~hot-dip segment~~ of the ~~North~~Chapter ~~American~~11 ~~galvanizing industry and believe that our new zinc facility~~Cases, ~~once~~access ~~fully operational, will be a leading supplier~~ to ~~this~~the ~~market. We~~DIP ~~sell zinc oxide to over 250 producers of tire and rubber products~~Facility, ~~chemicals,~~the ~~paints,~~consummation ~~plastics and pharmaceuticals. We have supplied zinc oxide to nine~~ of ~~our~~the ~~current~~Plan ~~ten~~in ~~largest~~a ~~zinc~~timely ~~oxide customers for over ten years~~manner, and our ~~acquisition~~ ofability ~~Zochem~~to onachieve ~~November~~profitability 1,following ~~2011,~~emergence afrom ~~producer of zinc oxide in North America, expanded our customer base throughout North America~~bankruptcy. We ~~believe that we~~

2For the duration of the Chapter 11 Cases, our operations and our ability to develop and execute our business plan are subject to the risks and uncertainties associated with the Chapter 11 process as described in Item 1A, “Risk Factors.” As a result of these risks and uncertainties, the description of our operations, properties and obligations included in this Annual Report on Form 10-K may not accurately reflect our operations, properties and obligations following the Chapter 11 Cases.

~~Table~~Notice of Delisting ~~Contents~~from NASDAQ

~~are~~On ~~the~~February 2, ~~largest recycler of EAF dust in the United States~~2016, ~~and~~ we ~~now~~received ~~recycle~~notice ~~EAF~~from ~~dust~~The ~~for~~NASDAQ ~~nine~~Stock ofMarket ~~North~~LLC (“NASDAQ”) ~~America’s~~that ~~ten~~trading ~~largest~~of ~~carbon~~our ~~steel~~common ~~EAF~~stock ~~operators~~was ~~and~~to ~~North~~be ~~America’s~~suspended ~~four~~at ~~largest~~the ~~stainless~~opening ~~steel~~of ~~producers.~~business Inon ~~addition~~February 11, we2016. ~~provide~~NASDAQ’s ~~environmental~~decision ~~services~~ to ~~over~~delist ~~200~~our ~~customers~~common ~~that~~stock ~~generate~~was ~~nickel-containing~~a ~~waste~~result ~~products~~of ~~such~~our asfiling ~~filter~~of ~~cake,~~the ~~spent~~Bankruptcy ~~pickle~~Petitions. ~~liquor~~On February 23, ~~grinding~~2016, ~~swarf~~NASDAQ ~~and~~filed ~~mill~~a ~~scale.~~Form We25, ~~also~~“Notification ~~collect~~of ~~and~~Removal ~~recycle batteries~~ from ~~Call2Recycle~~Listing Under Section 12(~~formerly~~b) ~~The~~of ~~Rechargeable~~the ~~Battery~~Securities ~~Recycling~~Exchange ~~Corporation)~~Act of 1934,” ~~founded~~with inrespect ~~1994~~to byour ~~five~~common ~~major~~stock. ~~rechargeable~~Our ~~battery~~common ~~makers,~~stock ascurrently ~~well~~trades asin ~~through~~the over-the-counter ~~our~~(“OTC”) ~~own~~market ~~collection~~under ~~programs~~the symbol ZINCQ.

AOperations ~~Leading Environmental Services Provider to the U.S. Steel Industry~~

We ~~believe~~operate ~~that~~in wethree ~~are~~distinct, ~~one~~but ~~of the~~related, ~~leading~~lines ~~environmental~~of ~~service~~business: ~~providers to~~ (a) the ~~U.S.~~processing ~~steel~~of ~~industry,~~EAF ~~having~~dust ~~recycled~~and ~~11.2~~other ~~million~~zinc-bearing material ~~tons~~to ofproduce ~~EAF~~and ~~dust~~sell ~~since~~zinc ~~1990,~~and ~~which~~other ismetals ~~the~~undertaken ~~equivalent~~by ofHorsehead ~~approximately~~Corporation; ~~2.2~~(b) the ~~million~~production ~~tons~~and sale of zinc tooxide ~~date~~undertaken ~~representing~~by ~~the~~Zochem; ~~dust~~and ~~generated in~~ (c) the ~~production~~processing of ~~over~~a ~~650~~variety ~~million tons~~ of ~~steel. Our~~metal-bearing ~~recycling~~waste materials and ~~conversion~~the production of ~~this~~nickel-bearing ~~EAF~~alloys ~~dust~~undertaken ~~reduces~~by aINMETCO. ~~steel~~The ~~mini-mill’s~~Horsehead ~~exposure~~Corporation tosegment ~~environmental~~generated ~~liabilities~~70%, ~~which~~56% ~~may~~and ~~arise~~58% ~~when~~of ~~the~~our ~~EAF~~revenues ~~dust~~in is2013, ~~sent~~2014 toand a2015, ~~landfill. Our~~respectively; ~~predecessor~~the ~~company~~Zochem ~~developed~~segment ~~this~~generated ~~proprietary~~18%, ~~process~~32% ~~during the 1980s~~ and we31% ~~have~~of ~~been~~our arevenues ~~leading~~in ~~EAF~~2013, ~~dust~~2014 ~~processor~~and ~~ever~~2015, respectively; ~~since. We~~and ~~use~~ the ~~recycled~~INMETCO ~~material~~segment asgenerated ~~low~~12%, ~~cost~~12% ~~feedstock~~and ~~for~~11% of our ~~metal~~revenues ~~production~~in ~~operations~~2013, ~~yielding~~2014 aand ~~competitive~~2015, ~~cost advantage~~respectively.

~~Low-Cost~~2 ~~Feedstock and Contracted EAF Dust Sources~~

WeTable believe that we are the only zinc metal producer in North America with the proven ability to produce zinc metal using 100% recycled zinc feedstocks. Our use of large amounts of recycled feedstock reduces our exposure to increases in LME zinc prices and increases our operating margins during periods of high LME zinc prices. In addition, our EAF dust recycling operations provide us with a reliable, cost-effective source of recycled zinc without relying on third-party sellers. Further, several of our EAF dust customers have long-term contracts to provide us with their EAF dust. Contents

Our ~~new~~recycling ~~zinc facility relies upon sustainable manufacturing practices to produce zinc solely from recycled materials~~ and ~~uses~~production ~~significantly~~operations ~~less~~in ~~fossil~~2015, ~~fuel~~including ~~than~~the ~~our~~currently ~~former~~idled Mooresboro facility ~~in Monaca~~, ~~Pennsylvania.~~formed ~~The~~a ~~new~~complete ~~zinc~~recycling ~~facility~~loop, ~~converts~~as ~~WOX~~illustrated ~~produced~~below, from ~~EAF dust recycling and other~~ recycled ~~materials~~metals ~~into SHG and other grades of zinc and eliminates the need~~ to ~~calcine~~finished ~~the majority of our WOX prior to its use. We believe the technology used at our new~~ zinc ~~facility~~or ~~will~~nickel-bearing ~~also allow us to recover value from metals such as silver and lead contained in EAF dust~~products.

LOGO

~~Proven,~~Horsehead ~~Proprietary~~Corporation ~~Technology~~and ~~with~~Zochem ~~Flexible Processes~~

~~Since~~Horsehead ~~our~~Corporation recycling processes convert EAF dust and other wastes into saleable products, our EAF dust customers generally face less exposure to environmental liabilities from EAF dust, which the U.S. Environmental Protection Agency (“EPA”) classifies as a listed hazardous waste, than if they disposed of their EAF dust in landfills. The EPA has designated our recycling processes as the “Best Demonstrated Available Technology” for the high-temperature metals recovery from EAF dust from both carbon steel mini-mill and stainless steel producers. In addition, we expect our new zinc facility to be able to produce zinc from a wide range of zinc-bearing raw materials. We expect that this flexibility will allow us to modify our feedstock mix based on cost and availability, as well as to use 100% recycled zinc feedstock, whether purchased from third parties at a discount to the LME zinc price or generated by our EAF dust recycling operations. We believe that our INMETCO recycling process is a successful technology for the recycling of a broad range of nickel-bearing waste products. We have successfully licensed this technology in the past.

~~Strong~~Recycling Operations, ~~Experienced~~Products ~~Management~~and ~~Team~~Services

~~Our~~Horsehead ~~eleven-member~~operates ~~senior~~four ~~management~~hazardous ~~team~~waste ~~collectively~~recycling ~~has~~facilities ~~over~~for ~~200 years~~the recovery of ~~experience in~~ zinc- ~~and~~from ~~metal-related~~EAF ~~industries~~dust. ~~James~~Our M.predecessor ~~Hensler,~~company ~~our~~created ~~Chief~~the ~~Executive~~market ~~Officer,~~for ~~joined~~EAF usdust recycling for carbon steel mini-mill producers with the development of our recycling technology in the early ~~2004~~1980’s. ~~and~~Our recycling process has ~~since~~been ~~established~~designated by the U.S. Environmental Protection Agency (“EPA”) as a ~~culture~~“Best Demonstrated Available Technology” for the processing of ~~continuous~~EAF ~~improvement~~dust. inOur ~~safety~~recycling ~~and~~facilities ~~operational~~are ~~excellence,~~strategically ~~which~~located ~~has~~near ~~led~~sources toof ~~significant~~EAF ~~cost~~dust ~~reductions~~production. These facilities recover zinc from EAF dust generated primarily by carbon steel mini-mill manufacturers during the melting of steel scrap, ~~productivity~~as ~~improvements~~well ~~and~~as ~~growth~~from other waste material.

~~Business~~We ~~Strategy~~are one of the leading environmental service providers to the U.S. steel industry, having recycled to date, together with our predecessors, 11.8 million tons of EAF dust since 1990, which is equivalent to approximately 2.4 million tons of zinc, and represents the dust generated in the production of over 690 million tons of steel. Horsehead Corporation’s recycling and conversion of EAF dust reduces a steel mini-mill’s exposure to environmental liabilities that may arise if EAF dust is sent to a landfill and not recycled. In 2015, we processed 579,000 tons of EAF dust and other zinc-bearing materials compared to 593,000 tons in 2014.

~~Ramp~~We extract zinc from EAF dust, and recycle the other components of EAF dust into non-uphazardous ~~Production~~materials, using our proprietary “Waelz Kiln” process at our ~~New~~Palmerton, ~~Zinc~~Pennsylvania, ~~Facility~~Barnwell, South Carolina, Rockwood, Tennessee, and Calumet, Illinois facilities. Our Waelz Kiln recycling process blends, conditions, adds carbon to and pelletizes EAF dust, and then feeds it into the kiln itself, a refractory-lined tube that is typically 160 feet in length and 12 feet in diameter. During the passage through the kiln, the material is heated under reducing conditions at temperatures exceeding 1,100 degrees Celsius, thereby volatilizing the nonferrous metals, including zinc. The resulting volatized gas stream is oxidized and collected as WOX, which has a zinc content between 55% and 65%. In addition, we produce iron-rich material that we sell for use as an aggregate in asphalt and as an iron source in cement.

3 In May 2014, we began production at our new zinc facility and on January 5, 2015, we reported that the facility produced approximately 12,000 tons of zinc metal in the fourth quarter of 2014. Once fully operational, we expect the new zinc facility to be capable of producing over 155,000 tons of zinc metal per year with equipment capable of producing over 170,000 tons of zinc metal per year without significant additional investment. Our new zinc facility currently in the ramp-up stage has experienced operational difficulties that we believe are typical of a start-up of this size which have resulted in production interruptions. Numerous improvements have been made to remediate these issues and improve the ramp-up rate. The primary bottleneck thus far has been

3Table of Contents

~~Table~~Currently, ofthe ~~Contents~~WOX generated at our Palmerton, Pennsylvania facility and at times, WOX generated at our other EAF dust recycling facilities, is further refined in a process, called “calcining,” whereby we heat the material to drive off impurities. Through this rotary kiln process, which is fired with natural gas, the zinc content is further increased from approximately 55% to 65% to approximately 65% to 70%, and the product is collected as zinc calcine in granular form.

~~the~~In ~~removal~~2015, ofwe ~~solids~~sold ~~at the front end of the process~~$58. We7 ~~have~~million ~~made progress through better control of the process~~ and ~~improvements in equipment reliability~~$1. ~~The~~3 ~~facility~~million ~~has operated continuously since early August 2014 after a shutdown during the month~~ of ~~July~~calcine ~~2014. During~~and ~~January 2015~~WOX, ~~we produced approximately 4~~respectively,~~600~~ ~~tons of zinc metal. We reduced the plating rate for several days in January~~ to ~~perform~~third ~~some~~parties ~~needed~~as ~~maintenance in~~ the ~~cell~~Mooresboro ~~house. We~~facility was ~~also~~not ~~experienced~~able intermittent equipment reliability issues, particularly with some key pumps, which were further exacerbated by recent extreme cold weather conditions. On February 20, 2015, we began a planned seven day outage to ~~address~~utilize ~~several of these issues. We expect to ramp-up production following this outage. Our interim target is to demonstrate that no bottlenecks exist to operating~~ the ~~facility~~total atamount ~~75%~~ of ~~nameplate~~EAF ~~capacity, or 330~~ tons ~~per~~processed ~~day,~~ by ~~the end of the first quarter of 2015. We believe that~~ our ~~ability~~recycling ~~to achieve this higher level of production will depend primarily on the absence of further unplanned equipment issues~~facilities. We expect to continue to work to correct the issues we have encountered in order to achieve better production levels in the coming months. Thus far, we have not identified any insurmountable technical or operational obstacles that materially challenge the value proposition of our new zinc facility.

~~Once~~Zinc ~~fully operational~~Operations, weProducts ~~expect to achieve significant benefits from the new zinc facility, including lower energy cost, higher labor productivity, reduced operating maintenance costs~~ and ~~lower~~Services operating and logistics costs at our EAF dust recycling plants resulting from the elimination of the need to calcine a majority of our WOX prior to its use. The facility enables us to convert WOX derived from EAF dust and other recycled materials into SHG zinc, CGG zinc and High Grade zinc, in addition to the PW grade that we produced at our former Monaca facility. This will allow us to expand into new markets, including selling to continuous galvanizers (which include some of our EAF dust customers) die casters and potentially LME warehouses, while continuing to serve customers in our existing markets. The technology associated with the new zinc facility will also allow us to recover valuable metals such as silver and lead contained in EAF dust. We began introducing feed into the lead-silver recovery circuit during the fourth quarter and have started to produce lead-silver concentrate that we are currently analyzing to fine tune this circuit. We are also addressing some issues with pump selection identified during the initial operating period. The new zinc facility replaced our older smelter technology and will allow us to significantly reduce emissions of greenhouse gases and particulates into the atmosphere.

WeHorsehead ~~believe~~Corporation weis ~~will be able to achieve~~ a ~~number~~producer of ~~additional benefits from our new~~ zinc ~~facility~~products, including ~~lower~~zinc ~~capital expenditures for maintenance~~metal, ~~lower~~used ~~state~~in ~~income~~the ~~taxes~~galvanizing ~~as a result~~ of ~~certain~~steel, ~~tax incentives available for the investment~~ in ~~the new~~ zinc ~~facility~~die castings, and ~~lower~~zinc-bearing ~~cash~~alloys ~~costs~~in ~~associated~~the ~~with~~United ~~our hedging program~~States. ~~For~~Horsehead ~~instance,~~Corporation ~~our~~also ~~annual~~produces ~~capital~~WOX ~~expenditures~~and ~~for~~zinc ~~maintenance~~calcine ~~of the Monaca, Pennsylvania facility averaged $7.8 million per year~~ for ~~the~~sale ~~period from 2007~~ to ~~2012~~other ~~(the~~zinc ~~last year significant expenditures were made at our Monaca facility); we expect these expenditures at our new facility to be substantially less~~producers. ~~Under~~Horsehead ~~our~~Corporation ~~hedging~~uses ~~program~~WOX, wethe ~~purchased~~primary ~~put~~product ~~options~~of atits anrecycling ~~average~~operations, ~~annual~~as a low-cost, ofraw material ~~$9.1~~feedstock ~~million~~in ~~for~~ the ~~period~~production ~~2008 to 2013 (the last full year~~ of ~~production~~zinc atmetal ~~our~~and ~~Monaca~~value-added ~~facility);~~zinc ~~however~~products, aswhich yields a ~~low-~~competitive cost ~~producer~~advantage. atOur ~~our~~EAF ~~new~~dust ~~zinc~~recycling ~~facility,~~operations weprovide ~~expect~~us ~~our~~with ~~hedging~~a ~~costs to be substantially lower~~reliable, ascost-effective ~~our~~source ~~risk~~ of ~~negative~~recycled ~~cash~~feedstock ~~flow~~without atrelying ~~lower~~on third-party ~~zinc prices will be substantially less~~sellers.

~~Continue~~Prior to ~~Focus~~the onPetition ~~Production~~Date, ~~Efficiencies~~Horsehead Corporation conducted its zinc production (as opposed to recycling) operations from its facility located in Mooresboro, North Carolina, which we began constructing in September 2011 to replace our former zinc smelter located in Monaca, Pennsylvania. We permanently shut down the Monaca facility in April 2014 and ~~Operating~~subsequently ~~Cost~~demolished ~~Reductions~~it, and sold the land in June 2015, although we retain ownership of a non-hazardous captive landfill located near that site.

InSince ~~2011~~operations began at the Mooresboro facility in May 2014, we ~~idled~~have ~~our~~experienced ~~power~~a ~~plant~~number ~~located~~of insignificant ~~Monaca~~operational, production, and ~~entered~~equipment ~~into~~issues associated with the attempted ramp-up of the Mooresboro facility. For example, it was discovered that the bleed treatment section of the facility was undersized causing a ~~contract~~bottleneck to ~~purchase~~production. ~~electricity~~Additionally, electrolyte ~~realizing~~quality ~~estimated~~deteriorated ~~savings~~causing significant corrosion to electrodes in the cell house due, in part, to poor control of $5solids carryover into the solvent extraction units combined with equipment issues related to faulty organic filters and the HCl regeneration units.4 ~~million~~Also, inseveral ~~2012~~pumps and lines were improperly designed for their intended application. ~~During~~ The Mooresboro facility was operating at approximately 25% of capacity during the fourth quarter of ~~2012~~2015. While we ultimately expected to realize substantial operating efficiencies from the Mooresboro facility once it became fully operational, we ~~decided~~have publicly identified ongoing challenges with respect to ~~permanently~~the ~~shut~~Mooresboro ~~down~~facility on numerous occasions. In total, we have invested approximately $575.0 million in the ~~power~~construction ~~plant~~and development of the Mooresboro facility, excluding capitalized interest and internal labor, as of the Petition Date. On January 22, 2016, due to financial constraints, we issued notices to our employees at the Mooresboro facility under the Worker Adjustment and Retraining Notification Act and publicly announced our intention to transition the Mooresboro facility from fully operational status to operating on a “care and maintenance level” only by February 8, 2016. To date, the Mooresboro facility remains in an idled state.

During ~~2012~~the year ended December 31, 2015, our operations were significantly impacted due to the dramatic decline in zinc, nickel and other commodity prices, continuing issues that delayed the ramp-up of the Mooresboro zinc facility, and lower EAF dust receipts reflecting weaker steel production. Additionally, on January 22, 2016 when we ~~increased~~temporarily idled the ~~use~~Mooresboro facility in the face of ~~WOX~~severe atliquidity constraints and our ~~former~~determination ~~Monaca,~~that ~~Pennsylvania~~the facility was incapable of generating positive cash flow in the future without significant additional capital investment and/or ~~implemented~~a ~~initiatives~~recovery in commodity prices, we determined a triggering event occurred related to ~~reduce~~our Mooresboro facility which required us to assess if the ~~iron~~carrying ~~content~~amount of this long-lived asset may not be recoverable. We performed the ~~WOX~~required ~~produced~~first atstep ~~three~~of the impairment test and determined the carrying amount of our ~~recycling~~Mooresboro ~~facilities,~~asset ~~resulting~~group inexceeded ~~cost~~the ~~savings~~sum of $2the expected undiscounted cash flows.5 ~~million~~We proceeded to the second step of the impairment test where we were required to determine a fair value for the Mooresboro asset group and $1recognize an impairment loss if the carrying value exceeded fair value.7 ~~million,~~Fair ~~respectively~~value of the Mooresboro asset group was determined using i) published prices of our publicly traded debt and equity coupled with ii) the latest twelve months revenue multiples of selected comparable guideline companies to isolate the Mooresboro asset group’s fair value. In ~~March~~The ~~2012,~~income approach wewas ~~granted~~not ~~Shell~~considered an ~~option~~appropriate fair value measurement due to ~~purchase~~the ~~our~~absence ~~Monaca,~~of ~~Pennsylvania~~reliable forecast data as the facility was idled indefinitely in early 2016 as a result of uncertainty around timing of future capital inflows necessary to make required capital improvements to generate positive cash flows stemming from the Chapter 11 proceedings as well as uncertainty around recovery timing of commodity prices. As a result of the impairment test, ~~which~~we ~~provided~~recorded ~~for~~a ~~demolition~~non-cash, ~~activities~~pretax atlong-lived asset ~~Shell's~~impairment ~~expense~~loss of $527. 6 million for the Mooresboro asset group. The ~~option~~total amount of this write-down is included in Loss from operations in the Consolidated Statement of Operations for the year ended December 31, 2015. Following the write-down of the asset group, the remaining net book value of the Mooresboro asset group was ~~exercised~~$87.6 onmillion ~~November~~at 7December 31, ~~2014~~2015. The ~~option~~impairment ~~also~~charge ~~included~~did not impact our ~~Horsehead~~business ~~Zinc~~operation ~~Powders~~or future cash flows nor did it result in any cash expenditures. In assessing the recoverability of our long-lived assets, ~~LLC~~we ~~facility~~are required to make assumptions regarding estimated future cash flows and other factors to determine the fair value of the respective assets. This process is subjective and requires judgment at many points throughout the analysis. If our estimates or their related assumptions change in subsequent periods or if actual cash flows or other market measures are below management’s estimates, ~~which~~we ~~was~~may ~~co-located~~be required to record impairment charges for these assets not previously recorded or additional impairments on ~~the~~assets ~~Monaca~~already ~~site~~recorded.

In4 2013, we idled the cadmium recovery facility at INMETCO by modifying the process to permit direct charging of Ni-Cd batteries to the rotary hearth furnace generating a net annual benefit of approximately $1.5 million. In addition, in December 2013, we entered into a joint venture known as ThirtyOx, LLC ("ThirtyOx") with Imperial Zinc Corp. for the acquisition and processing of zinc bearing secondary materials. The processing operation is located in North Carolina near the new zinc facility and became operational in August 2014. The majority of the feedstock for the new zinc facility will be supplied by Horsehead's EAF dust recycling plants. ThirtyOx is expected to supply a portion of the incremental zinc feed required by the new zinc facility by recovering secondary zinc oxides from the residues generated by galvanizers, die-casters and other users of zinc metal. Our anticipated investment in ThirtyOx is expected to be less than $2.0 million. Also in December 2013, we sold our copper-based powders line of business located in Palmerton, Pennsylvania. This business unit was considered to be non-core and was not making a positive contribution to our profit margin. We have continued to operate our zinc powder business at our Palmerton facility.

InTable April 2014, we ceased production at our Monaca, Pennsylvania facility in order to transition production to the new zinc facility in Mooresboro, North Carolina. We believe that the new zinc facility, once fully operational, will provide us with a number of substantial benefits, including reduced manufacturing conversion costs due to lower energy cost; higher labor productivity; Contents

4The Mooresboro facility’s design is intended to allow us to produce special high grade (“SHG”) zinc, continuous galvanizing grade (“CGG”) zinc, and high grade zinc, in addition to the prime western zinc we formerly produced at the Monaca facility. The Mooresboro facility’s design is intended to use sustainable manufacturing practices to produce zinc solely from recycled materials. The Mooresboro facility is designed to use significantly less fossil fuel, primarily in the form of metallurgical coke, than the Monaca facility, which we believe will allow us to reduce greenhouse gas emissions and particulates into the atmosphere. The Mooresboro facility is designed to process a wide range of recycled oxidic zinc materials.

~~Table~~Once fully operational, we believe the Mooresboro facility will eliminate the need to calcine WOX prior to its use, thereby reducing our manufacturing conversion and logistics costs in our recycling facilities. In addition, we expect that the Mooresboro facility, once fully operational, will have lower conversion costs than the Monaca facility previously had, allow us to realize a higher premium on the sale of ~~Contents~~SHG and CGG zinc and recover value from the lead and silver contained in WOX in addition to increasing the total output of zinc metal from the same.

~~reduced~~Our ~~operating~~zinc ~~maintenance~~powder ~~costs~~is sold for use in a variety of chemical, metallurgical and ~~lower~~battery ~~operating~~applications ~~costs~~as well as for use in corrosion-resistant ~~our~~coating ~~EAF~~applications. ~~dust~~Zinc ~~recycling~~powder ~~plants~~is ~~resulting~~manufactured ~~from~~by the ~~elimination~~atomization of ~~the~~molten ~~need~~zinc. toWe ~~calcine~~manufacture the ~~majority~~following ofbasic ~~our~~lines ~~WOX~~of ~~prior~~powders toat ~~its~~our ~~use~~Palmerton facility.

We• ~~expect~~Special toZinc ~~continue~~Powders. toThese ~~pursue~~are ~~capital~~used ~~investment~~in ~~opportunities~~general tochemical ~~improve~~and ~~production~~metallurgical ~~efficiencies~~applications, and ~~reduce~~in ~~costs~~friction ~~at our current facilities~~applications, ~~including~~such atas ~~our~~brake ~~new~~linings ~~Mooresboro,~~for ~~North Carolina facility~~automobiles.

~~Expand~~• ~~EAF~~Battery ~~Dust~~Grade ~~Recycling~~Zinc ~~Capacity~~Powders. These are used in most types of alkaline batteries, as well as mercuric oxide, silver oxide and zinc-air batteries.

WeZochem estimate that in 2007 approximately one-third of the carbon steel EAF dust generated in the United States was deposited in landfills, including by our existing EAF dust customers. Since then, new EAF steel plant projects have come online, further increasing EAF dust generation in the United States. Due to productivity, capital and operating cost efficiencies relative to integrated steel mills, the mini-mill share of the U.S. steel market has increased in the last ten years and is expected to account for over 60% of U.S. steel produced, according to the Steel Manufacturers Association. Steel mini-mill operators have increasingly relied on recyclers rather than landfills to manage this increased output. In order to grow our EAF dust recycling business, we placed a new kiln with an annual EAF dust recycling capacity of 80,000 tons into production in early 2008 at our facility in Rockwood, Tennessee and placed into production two kilns with a combined annual capacity of 180,000 tons at our facility in Barnwell, South Carolina in 2010. We entered into a long term contract with a major U.S. steel mini-mill producer to process all of the EAF dust generated at its facilities located near this plant. In 2009, we acquired the EAF dust contracts held by Envirosafe Services of Ohio, Inc (“ESOI”), a leading landfill disposer of EAF dust. In addition to generating additional service fees, our kilns provide us with additional low-cost recycled zinc that we can use in our own production process or that we can sell as feed to zinc smelters. We estimate that with the increased recycling capacity, less than 10% of the EAF dust generated is now deposited in landfills. We are currently considering the addition of a fifth dust recycling facility in the U.S. of a size similar to our three current two-kiln facilities, to increase our production capacity in response to third party growth in EAF steelmaking capacity and to reduce transportation costs for us and our customers. We also believe there is potential to gain additional market share from existing customers as a result of industry consolidation.

~~Diversify~~Our Zochem facility, which we acquired on November 1, 2011, is located in Brampton, Ontario, Canada and ~~Expand~~produces ~~Environmental~~zinc oxide. ~~Services~~We ~~Business~~believe Zochem is the largest single-site producer of zinc oxide in North America. The production process uses SHG zinc as raw material which is added to the melting section of the furnaces. The melted zinc is then boiled and the zinc vapor is combusted as it enters an oxidation chamber. The zinc oxide is then collected and packaged for shipment. The Zochem facility has the capacity to produce approximately 72,000 tons of zinc oxide a year. Zinc oxide is used as an additive in various materials and products, including plastics, ceramics, glass, rubbers, cement, lubricants, pigments, sealants, ointments, fire retardants, and batteries.

Our core strengths relate to our proven ability to manage hazardous and non-hazardous wastes generated by industrial processes and our experience and capabilities to recover valuable metals from these waste streams. We ~~expect~~sell toover ~~expand~~20 ~~our~~different ~~environmental~~grades ~~services business into a broader range~~ of ~~metal-bearing~~zinc ~~wastes.~~oxide ~~The~~with ~~acquisition~~differing ofparticle ~~INMETCO is an example of this diversification and we believe that INMETCO will be a platform for further growth. The recent entrance of Outokumpu~~sizes, ~~a leading global stainless steel producer~~shapes, ~~into~~coatings the Untied States market creates an opportunity for us to increase capacity at INMETCO to supply Outokumpu's growing need at its new stainless steel melt facility in Calvert, Alabama. We expect to continue to pursue diversification and ~~acquisition~~purity ~~opportunities in the area of environmental services, such as recycling metals from spent catalysts and acquiring metal processing businesses~~levels. We ~~believe~~Various ~~this~~end uses ~~strategy,~~for ~~along with the planned recovery of metals such as silver and lead from WOX at our new~~ zinc ~~facility,~~oxide ~~will~~include ~~reduce~~the ~~our~~following: ~~exposure to changes in zinc and nickel prices.~~

~~Continue~~• toTire ~~Reduce~~and ~~Exposure~~rubber toapplications. ~~Commodity~~Zinc ~~Price~~oxide ~~Fluctuations~~aids in the vulcanization process, acts as a strengthening and reinforcing agent, provides ultra-violet (“UV”) protection, and enhances thermal and electrical properties. There is approximately a half pound of zinc oxide in a typical automobile tire.

We• ~~regularly~~Chemical ~~evaluate our zinc price hedging alternatives considering the costs and benefits in light of the commodity price environment~~applications. WeIn ~~sourced~~motor ~~over~~oil, ~~90% of our~~ zinc ~~feedstock~~oxide ~~during~~is ~~2014~~used atto ~~our~~reduce ~~former Monaca~~oxidation, ~~Pennsylvania~~inhibit ~~facility~~corrosion and ~~new~~extend ~~Mooresboro,~~the ~~North~~wear ~~Carolina facility from our EAF dust recycling operations. This source~~ of ~~feedstock~~automotive ~~is not significantly impacted by changes in LME zinc prices~~engines. ~~The~~In ~~remainder~~plastics, ~~of our~~ zinc ~~feedstock~~oxide ~~costs~~ is ~~derived~~an ~~primarily~~effective ~~from~~UV ~~zinc~~stabilizer ~~secondaries~~for ~~which~~polypropylene ~~use LME-based pricing,~~ and ~~therefore are somewhat naturally hedged against changes in the LME price~~polyethylene.

We• ~~use instruments such as put options and swaps to protect our Company from price fluctuations~~Ceramics. ~~During~~Ceramics ~~August~~containing ~~2013, we put in place equivalent $0.85 per pound strike price put options covering 4,400 tons per month of~~ zinc ~~production~~oxide ~~for~~are ~~the~~used period of January 2014 through March 2014 and converted $0.85 per pound strike price put options covering 4,950 tons per month of zinc production from October 2013 through March 2014 to zinc fixed price swap contracts for the same period at an average price of approximately $0.903 per pound. The sale of the put options resulted in aelectronic $1components.3 ~~million~~For ~~cash benefit~~example, ~~and we were able to put the swaps~~ in ~~place~~ceramic ~~without~~varistors ~~any~~(surge ~~additional payment. In December 2013~~protectors), ~~we entered into additional~~ zinc ~~fixed~~oxide ~~price~~allows ~~swap contracts~~ for ~~the~~high ~~first~~temperature ~~quarter of 2014 at an average price of approximately $0.90 per pound. These zinc fixed price swaps were also transacted without any payment by us. At December 31~~stability, ~~2013,~~resistance ~~the total quantity covered under forward zinc fixed price swaps for the first quarter of 2014 was 26,600 tons. We converted a portion of our put options into swaps in order~~ to ~~reduce~~electrical ~~the effect of changes in the zinc price on cash flow during the period of planned transition of operations to the new zinc facility. At December 31~~load, ~~2013,~~current weshock ~~had~~and ~~put options in place with a strike price of $0~~humidity.~~85 per pound covering approximately 11,600 tons of zinc production for the first quarter of 2014. The put options settled monthly on an average LME pricing basis. The average LME monthly zinc prices~~

5• Other applications. In paints, zinc oxide provides mold and mildew protection, functions as a white pigment and provides UV protection and chalking resistance. In pharmaceutical applications, zinc oxide operates as a sunscreen, a vitamin supplement and a medicinal ointment.

~~Table~~5 ~~of Contents~~

forTable first three months of 2014 were higher than the strike price for the contracts and we received no settlement payment during 2014. Contents

~~During~~Zinc ~~the~~Production ~~first~~Process quarter of 2014, we added fixed price swaps for the second quarter of 2014, at an average price of approximately $0.94 per pound for a total quantity covered of 26,500 tons for the quarter. In late July and early August 2014, we added zinc fixed price swaps for the months of August and September 2014, at an average price of slightly over $1.07 per pound for a total quantity covered of 6,000 tons per month. In October and early November 2014, we added zinc fixed price swaps for the months of November and December 2014, at an average price of slightly over $1.05 per pound for a total quantity covered of 6,600 tons per month. These fixed rate swaps were put in place to reduce volatility during the continued ramp-up of production at the new zinc facility. We received a net of $0.7 million for settlement of our fixed rate swaps in 2014.

~~Under~~The ~~our~~chart ~~hedging~~below ~~program,~~describes wethe ~~purchased~~designed ~~put~~flow ~~options~~of atoperations anfor ~~average~~our ~~annual~~zinc ~~cost~~facilities ofin ~~$9.1~~2015, ~~million~~including ~~per year for~~ the ~~period~~process ~~from~~with ~~2008~~ respect to ~~2013 (~~the ~~last~~currently ~~full~~idled ~~year~~Mooresboro ~~of production at our Monaca, Pennsylvania~~ facility);. ~~however,~~The aschart abegins ~~low-cost~~with ~~producer~~the atinput ~~our~~of ~~new~~raw ~~zinc facility~~materials, wecontinuing ~~expect~~through ~~our~~the ~~hedging~~production ~~costs~~processes toand beidentifying ~~substantially~~finished ~~lower,~~products asand ~~our~~end ~~risk~~uses offor ~~negative~~each ~~cash~~such ~~flow~~raw ~~at lower zinc prices will be substantially less, once the new zinc facility is fully operational~~material.

LOGO

~~Pursue~~Sales ~~Acquisition, Diversification~~ and ~~Expansion~~Marketing ~~Opportunities~~

InZinc ~~2011,~~products ~~we acquired Zochem, located in Brampton, Ontario Canada, a producer of zinc oxide in North America. This acquisition broadened our geographic reach, diversified our customers~~ and ~~markets~~services ~~for~~sales ~~zinc oxide~~ and ~~provided~~marketing ~~added~~staff ~~operational~~consists ~~flexibility. We~~of: completed a capacity expansion at this facility in 2014, bringing our total investment in Zochem, including its initial purchase price, to $32 million. The expansion increased the total zinc oxide production capacity at Zochem by approximately 20,000 tons to approximately 72,000 tons per year.

We• ~~believe~~a ~~INMETCO~~sales ~~provides~~and ~~new~~marketing ~~potential~~group ~~platforms~~comprised ~~for growth, including increasing capacity~~ of ~~the~~sales ~~existing~~professionals ~~facility,~~whose ~~growing~~goal ~~our~~is ~~share of the battery recycling market, recycling other industrial wastes~~ to ~~recover~~develop ~~metals in addition to nickel~~ and ~~enabling~~maintain usexcellent tocustomer ~~expand~~relationships ~~internationally. We have increased power to our submerged arc furnace to increase melting output~~ and ~~keep~~provide ~~pace~~key ~~with~~market ~~stronger~~analysis; tolling receipts. We believe there are further opportunities to increase capacity at INMETCO to service additional growth in nickel-bearing industrial wastes generated by U.S. stainless steel producers. We are also currently evaluating opportunities outside the United States for the use of INMETCO's technology.and

In• ~~December~~a ~~2013,~~customer weservice ~~entered~~department ~~into~~responsible ~~the ThirtyOx joint venture with Imperial Zinc Corp.~~ for ~~the acquisition and~~ processing of zinc ~~bearing~~orders, ~~secondary~~scheduling ~~materials.~~product ~~The~~shipments ~~processing facility is located in North Carolina near the new zinc facility~~ and ~~became~~answering ~~operational~~customer in August 2014. The majority of the feedstock for the new zinc facility will be supplied by our EAF dust recycling facilities. Thirty Ox is expected to supply a portion of the incremental zinc feed required by the new zinc facility by recovering secondary zinc oxides from the residues generated by galvanizers, die-casters and other users of zinc metal.inquiries

WeOur ~~intend~~process toengineering ~~continue~~group provides additional technical assistance to our ~~identify~~EAF clients with monthly EAF analytical information and ~~enter~~assistance ~~new~~with ~~markets~~any problems encountered on EAF dust chemistry, transportation and environmental matters. Our quality assurance department provides extensive laboratory services critical to maintaining ~~increase~~in-plant ~~our~~process ~~production~~control ~~capacity,~~and providing customer support by certifying compliance to hundreds of unique product ~~offerings,~~specifications. ~~customer~~Our ~~base,~~laboratory ~~operating~~also ~~flexibility~~offers sales and technical services support by assisting in new product ~~margins~~developments ~~through~~and troubleshooting ~~strategic~~various ~~acquisitions~~application and ~~internal~~processing ~~expansion~~issues ~~initiatives~~both in-plant and with specific customers. We also rely on a network of distributors with warehouses and third party warehouses throughout North America and Europe that provide shorter delivery times for certain customers.

~~Our~~Customers ~~History~~

~~We,~~The ~~together~~Mooresboro ~~with~~facility ~~the~~produced ~~previous~~high ~~owners~~grade ~~of our assets, have been operating in the~~ zinc ~~industry for more than 150 years. Horsehead Industries~~, ~~Inc.~~and ~~(“HII”)~~to ~~was formed as~~ a ~~result~~lesser ofextent ~~several~~SHG ~~purchases of assets and entities that substantially form our existing company. In 2002, record-low~~ zinc ~~prices~~, ~~production~~primarily ~~inefficiencies, high operational costs and legacy environmental costs associated with prior owners/operators of our facilities caused HII to file~~ for ~~Chapter 11~~customers ~~bankruptcy~~throughout ~~protection. An affiliate of Sun Capital Partners, Inc. (together with its affiliates, “Sun Capital”) purchased substantially all of~~ the United ~~operating~~States ~~assets~~ and ~~assumed~~Canada ~~certain~~prior ~~liabilities of HII in December 2003 pursuant~~ to abeing ~~sale~~idled ~~order under Section 363 of the U.S. Bankruptcy Code. Sun Capital assisted us~~ in ~~hiring~~January our current chief executive officer and chief financial officer in 2004, and since that time we have implemented significant operational improvements as well as experienced significantly improved industry conditions2016. ~~As a result of certain transactions in 2007, Sun Capital and its affiliates no longer own any of our outstanding common stock.~~

On6 ~~August 15, 2007, we completed an initial public offering and began trading our common stock on the NASDAQ stock market.~~

InTable June 2009, we acquired the EAF dust collection business of ESOI, the then largest land-filler in our market. As part of this acquisition, we purchased their EAF dust contracts, one of which was for 10 years with a major Midwestern producer. We did not acquire their landfill or landfill operations. Contents

6We sell zinc oxide to over 250 different customers under contract as well as on a spot basis, principally to manufacturers of tire and rubber products, lubricating oils, chemicals, paints, ceramics, plastics and pharmaceuticals and have supplied zinc oxide to the majority of our largest customers for over 10 years.

~~Table~~We oftypically ~~Contents~~enter into multi-year service contracts with steel mini-mills to recycle their EAF dust. We provide our EAF dust recycling services to over 45 steel producing facilities.

OnIn ~~December~~2015, we derived 58% of our consolidated sales from Horsehead Corporation customers and 31,% ~~2009,~~of weour ~~acquired~~consolidated ~~INMETCO~~sales from Zochem customers.

OnRaw ~~November~~Material ~~1, 2011, we acquired Zochem.~~

OnPrior ~~October~~to 30being idled, ~~2013~~the feedstock for the Mooresboro facility was supplied by our EAF dust recycling plants. In the future, it weis ~~completed~~intended anthat ~~underwritten~~any ~~public~~additional ~~offering~~raw material feed needed will be comprised of 6purchased zinc secondaries,~~325~~ which are principally zinc-containing remnants of steel galvanizing processes,~~000~~ ~~shares~~including skimmings produced by several of ~~common~~our ~~stock~~metal customers. atThe ~~$12~~prices of zinc secondaries vary according to the amount of recoverable zinc contained and the LME zinc price and provide us with a diverse portfolio of low cost inputs from which to choose.00 ~~per~~In ~~share~~addition to the skims from the galvanizing industry, we can purchase other types of zinc-bearing residues from the zinc, brass and alloying industries. Many of these materials can be acquired from our own customers.

OnIn ~~January~~December 282013, ~~2015,~~ we ~~completed~~entered aninto ~~underwritten~~a ~~public~~joint ~~offering~~venture ofknown 5as ThirtyOx,~~750,000~~ ~~shares~~LLC (“ThirtyOx”) with Imperial Acquisitions LLC for the acquisition and processing of ~~common~~zinc ~~stock~~bearing atsecondary ~~$12~~materials.75 ~~per~~The ~~share~~processing operation is located in North Carolina near the Mooresboro facility and became operational in August 2014. The majority of feedstock used by ThirtyOx consists of galvanizer skimmings and other zinc-containing secondary materials.

~~Operations~~Raw materials used in our Zochem facility consist entirely of SHG zinc metal purchased from several suppliers. The price of this material is based on the LME zinc price.

~~Our~~Intellectual zinc recycling facilities recycle EAF dust into WOX, which we then use as raw material feedstocks in the production of zinc metal and value-added zinc products. The new zinc facility in Mooresboro, North Carolina which began operations in May 2014 utilizes ZINCEX TM solvent extraction technology coupled with state-of-the-art electro-winning and casting capabilities. The new zinc facility converts WOX produced from our EAF dust recycling facilities and other recycled materials into SHG and other high grades of zinc in addition to the PW zinc that we previously produced. We believe the new technology will also allow us to recover value from metals such as silver and lead contained in EAF dust.Property

~~Until~~We ~~the~~possess ~~closure~~proprietary technical expertise and know-how related to EAF dust recycling and zinc production, particularly zinc production using recycled feedstocks. Our proprietary know-how includes production methods for zinc oxide and micro-fine zinc oxides and widely varying customer specifications. As a major supplier of ~~our~~zinc ~~Monaca~~metal and other zinc-based products to industrial and commercial markets, ~~Pennsylvania~~we ~~smelter~~emphasize developing intellectual property and protecting our rights in ~~April~~our ~~2014~~processes. However, the ~~majority~~scope of ~~the~~protection ~~WOX~~afforded ~~produced~~ by ~~our~~intellectual ~~recycling~~property ~~facilities~~rights, ~~was~~including ~~further~~ours, ~~refined~~is ~~into~~often ~~calcine~~uncertain and involves complex legal and ~~used~~factual asissues. aAlso, ~~raw~~there ~~material~~can ~~feedstock~~be no assurance that intellectual property rights will not be infringed or designed around by others. ~~After~~ ~~April~~In ~~2014~~addition, ~~the~~we ~~zinc~~may ~~calcine~~not ~~produced~~elect ~~was~~to ~~sold~~pursue an infringer due to ~~third~~the ~~parties.~~high ~~The~~costs ~~calcining~~and uncertainties ~~operation~~associated ~~will~~with litigation. Further, there can be ~~shut~~no ~~down~~assurance ~~when~~that ~~Mooresboro~~courts ~~begins~~will toultimately ~~consistently~~hold ~~achieve~~issued aintellectual ~~production~~property ~~capacity~~rights ~~utilization~~to ~~level~~be ofvalid ~~approximately~~and ~~75%~~enforceable.

Competition ~~Our nickel facility recycles a broad range of nickel-bearing wastes into a remelt alloy product used in the production of stainless steel.~~

Our primary ~~recycling and production operations form a complete recycling loop, as illustrated below, from recycled metals to finished~~ zinc oroxide ~~nickel-bearing~~competitors ~~products. We believe we~~ are ~~the~~U.S. ~~only~~Zinc, ~~primary~~located ~~zinc producer~~ in the southern United States ~~that~~and ~~uses~~G.H. ~~recycled~~Chemicals, ~~materials~~located ~~for~~in ~~substantially~~Eastern ~~all of its zinc feedstocks~~Canada.

~~Zochem~~Historically, ~~which~~the majority of the zinc metal consumed in the United States has been imported. Before idling the Mooresboro facility, we ~~acquired~~had onno ~~November~~direct 1competitor recycling similar secondary materials into finished zinc products in North America. Domestic producers like us enjoy a freight and reliability advantage over foreign competitors with respect to U.S. customers. Hudbay Mining and Smelting Co. Limited, ~~2011~~Teck Cominco Limited, ~~uses~~Nyrstar, ~~SHG~~Glencore and Penoles are the primary zinc metal toproducers ~~produce~~in ~~zinc~~the ~~oxide~~North American market. The vast majority of the metal produced by these companies is used by continuous galvanizers in the coating of steel sheet products. In addition, these producers have mining and smelting operations. We have neither mining operations nor smelting operations.

7We compete for EAF dust management contracts primarily with Steel Dust Recycling and its parent company, Zinc Nacional, of Monterrey, Mexico and to a lesser extent with landfill operators. Our proven reliability, expanded processing capacity and customer service have helped us maintain long-standing customer relationships. Many of our EAF dust customers have been under contract with us since our predecessor began recycling EAF dust in the 1980’s.

~~Table~~7 ~~of Contents~~

ZincTable Productsof and Services - Horsehead and ZochemContents

~~Recycling~~INMETCO ~~Operations~~

Horsehead operates four hazardous waste recycling facilities for the recovery of zinc from EAF dust. Our recycling process has been designated by the EPA as a “Best Demonstrated Available Technology” for the processing of EAF dust. Our recycling facilities are strategically located near sources of EAF dust production. These facilities recover zinc from EAF dust generated primarily by carbon steel mini-mill manufacturers during the melting of steel scrapOperations, asProducts ~~well as from other waste material. We extract zinc from EAF dust,~~ and ~~recycle~~Services the other components of EAF dust into non-hazardous materials, using our proprietary “Waelz Kiln” process at our Palmerton, Pennsylvania, Barnwell, South Carolina, Rockwood, Tennessee, and Calumet, Illinois facilities.

~~Our~~INMETCO ~~Waelz~~is ~~Kiln~~a ~~recycling~~leading ~~process~~recycler ~~blends,~~of ~~conditions,~~nickel-bearing ~~adds~~waste ~~carbon~~generated toby the stainless and ~~pelletizes~~specialty ~~EAF~~steel ~~dust~~producers, and ~~then~~a ~~feeds~~leading recycler itof ~~into the kiln itself, a refractory~~nickel-~~lined~~cadmium ~~tube~~and ~~that~~other istypes ~~typically~~of ~~160~~batteries ~~feet~~ in ~~length~~North ~~and~~America. 12INMETCO ~~feet~~operates inout ~~diameter.~~of ~~During~~a ~~the~~facility ~~passage~~located ~~through~~in ~~the~~Ellwood ~~kiln~~City, ~~the~~Pennsylvania, ~~material~~which isproduces ~~heated~~nickel-bearing ~~under~~products ~~reducing~~by ~~conditions~~using ~~at temperatures exceeding 1,~~100% ~~degrees~~recycled ~~Celsius,~~materials. ~~thereby volatilizing the nonferrous metals~~Additionally, ~~including~~INMETCO collects ~~zinc.~~and ~~The~~recycles ~~resulting~~batteries ~~volatized~~through ~~gas~~its ~~stream~~own iscollection ~~oxidized~~programs and ~~collected as WOX~~Call2Recycle, which ~~has~~was afounded ~~zinc~~in ~~content~~1994 ofby ~~between~~five ~~55%~~major ~~and~~rechargeable ~~65%~~battery makers. InINMETCO ~~addition,~~also weprovides ~~produce~~environmental ~~iron-rich~~services ~~material~~to ~~that~~generators weof ~~sell~~nickel-containing ~~for~~waste products, ~~use~~such as anfilter ~~aggregate~~cake, inspent ~~asphalt~~pickle ~~and~~liquor, asgrinding answarf, ~~iron~~and ~~source~~mill ~~in cement~~scale.

~~Currently,~~INMETCO ~~the~~operates ~~WOX~~a ~~generated~~high attemperature metals ~~our~~recovery ~~Palmerton, Pennsylvania~~ facility ~~and at times WOX generated at our other EAF dust recycling facilities~~, iswhich ~~further~~utilizes ~~refined in~~ a ~~process,~~combination ~~called “calcining,” whereby we heat the material to drive off impurities. Through this~~ rotary ~~kiln~~hearth ~~process,~~furnace ~~which~~and iselectric ~~fired~~arc ~~with~~smelting ~~natural~~furnace ~~gas, the zinc content is further increased~~ to ~~approximately~~recover ~~65% to 70%~~nickel, chromium and ~~the~~iron, ~~product~~along iswith ~~collected~~smaller asamounts ~~zinc calcine in granular form. Prior to the closure~~ of ~~the~~other ~~Monaca smelter in April 2014~~metals, ~~the~~from ~~majority of zinc calcine was shipped to that facility, or at different time periods,~~ a ~~portion~~variety ~~was sold to other zinc refineries around the world. Beginning in the fourth quarter~~ of ~~2013~~metal-bearing ~~and~~waste ~~throughout 2014~~materials, generated ~~due~~primarily toby the ~~reduced~~specialty ~~production~~steel ~~and~~industry. ~~eventual~~INMETCO’s ~~closure~~main ofproduct ~~the~~is ~~Monaca~~a ~~facility~~nickel-chromium-iron ~~in April 2014 and the ramp~~(“Ni-upCr-Fe”) ofremelt ~~production~~alloy atingot ~~the~~that ~~new~~is ~~zinc~~used ~~facility~~as ~~which~~a ~~began~~feedstock ~~production~~to inproduce ~~May~~stainless ~~2014, we sold WOX~~ and ~~zinc~~specialty ~~calcine to third parties~~steels. ~~The~~INMETCO ~~calcining~~also ~~operation~~recycles alkaline ~~will~~batteries bein ~~shut~~conjunction ~~down~~with ~~when Mooresboro begins to consistently achieve a production capacity utilization level of approximately 75%~~Horsehead.

WeThe ~~believe~~INMETCO ~~the~~process ~~technology~~for ~~associated~~treating ~~with~~Ni-Cr-Fe metals waste is comprised of feed preparation, blending and pelletizing, thermal reduction and smelting and casting. The first portion of the ~~new~~INMETCO ~~zinc~~process ~~facility~~consists ~~will~~of ~~also~~material ~~allow~~preparation, usstorage, blending, feeding and pelletizing. INMETCO receives the various wastes and pretreats them when necessary to ~~recover~~ensure ~~value~~a ~~from~~uniform ~~metals~~size ~~such~~of the raw material. These materials, as ~~silver~~well as flue dust and ~~lead~~carbon, ~~contained~~are inpelletized. Pellets are transferred to the rotary hearth furnace for the reduction of some oxidized metal to its metallic form. Reduced pellets are fed to the EAF ~~dust~~for production of Ni-Cr-Fe remelt alloy. Slag discharged from the EAF is processed and sold primarily as road aggregate.

In8 order to expand our EAF dust recycling capacity, we brought an 80,000 tons per year kiln online at our Rockwood, Tennessee facility in January 2008 at a cost of approximately $33 million. In 2010, we brought a new 180,000 tons per year kiln facility online in Barnwell, South Carolina for a total investment of approximately $65 million. We are currently considering the addition of a fifth dust recycling facility in the United States of a size similar to our three current two-kiln facilities, to increase our production capacity in response to third party growth in EAF steelmaking capacity and to reduce transportation costs for us and our customers. We also believe there is potential to gain additional market share from existing customers as a result of industry consolidation.

ZincTable Productionof Contents

The Onchart ~~October~~below ~~31,~~describes ~~2013, we notified various required parties, as required by~~ the ~~Worker~~INMETCO ~~Adjustment~~flow ~~and Retraining Notification Act~~ of ~~1988~~operations, 29beginning ~~U.S.C.~~with ~~§ 2101 et seq.~~raw materials, ~~that~~continuing athrough ~~majority of our manufacturing operations at our former facility located in Monaca, Pennsylvania were expected to be permanently closed and shut down within several months of~~ the ~~notice.~~process ~~On December 23, 2013, the zinc oxide~~ and ~~high~~identifying ~~purity metal refinery operations at the Monaca facility ceased operation~~products. As of December 31, 2013, the smelting operation was reduced from six furnaces to five furnaces as the remaining zinc feedstock at the site was converted to PW grade zinc metal. At the end of April 2014, our Monaca, Pennsylvania facility was shut down permanently.

LOGO

8INMETCO provides recycling services to its customers under two types of fee arrangements: toll processing arrangements and environmental services arrangements.

~~Table~~Tolling ofServices ~~Contents~~

~~The~~Under ~~chart~~the ~~below~~tolling ~~describes~~arrangement, ~~the~~INMETCO ~~flow~~charges a processing fee per ton of ~~operations~~waste received and returns a remelt alloy product based on the waste’s metal content and INMETCO’s historical metal recovery factors for ~~our~~similar ~~zinc~~waste ~~facilities~~products. ~~The~~INMETCO ~~chart~~serves ~~begins~~almost all of the major austenitic stainless steel manufacturers in the United States in its tolling segment. We believe INMETCO is the only recycler of stainless steel wastes in North America and that INMETCO’s customers rely on its services to promote sustainable business practices, to avoid potential environmental liabilities associated with disposing of hazardous wastes at landfills and to take advantage of the ~~input~~return of ~~raw~~valuable metals from their metal-bearing waste products. INMETCO receives four main nickel-containing waste materials from the specialty steel industry, ~~continuing~~which ~~through~~support the “tolling” ~~production~~segment ~~processes~~of the business. These materials are flue dust, mill scale, grinding swarf and ~~identifying~~shot ~~finished~~blast ~~products~~dust and ~~end~~are ~~uses~~received ~~for~~either ~~each~~in ~~such~~a ~~raw~~dry ~~material~~form or a wet form containing oil and/or water. Furnace baghouse dust or flue dust is generated during the melting and refining steps in the manufacture of stainless steel.

Environmental ~~The~~Services new zinc facility located in Mooresboro, North Carolina began production in May 2014. The facility, when fully operational, is expected to produce 155,000 tons per year of zinc metal in the form of slabs or jumbo ingots and in zinc grades, including SHG, CGG and other High Grades zinc, in addition to PW zinc that we produced at our former Monaca, Pennsylvania facility. We believe the equipment is capable of producing over 170,000 tons of zinc metal per year without significant additional investment. The facility is fed with a combination of WOX generated at the Company’s EAF dust recycling plants and secondary zinc oxides purchased from the Company’s ThirtyOx joint venture. These sources may be supplemented by other purchased sources of zinc-bearing materials from time-to-time.

9Under the environmental fee arrangement, INMETCO acquires waste materials and processes those materials with no obligation to return any product to the customer. Depending on the state of the metals markets, INMETCO either charges a fee or pays to acquire environmental services materials. These materials include batteries and specialty steel industry wastes. All battery chemistries are accommodated. Batteries with chemistry compatible with the INMETCO process are processed directly while non-compatible types are sent to third party recyclers for processing. Recycling of household alkaline batteries has become a growing market that results in scrap steel as a feed to INMETCO and zinc concentrate used by Horsehead. Specialty steel industry wastes include flue dust, mill scale, grinding swarf and pickling filter cake along with a wide variety of other nickel-bearing wastes. Revenues are derived from these materials through the sale of the derived products into the appropriate markets as well as scrap sales and brokerage activities. No materials are sent to landfills.

~~Table~~9 ~~of Contents~~

ATable diagram of the new zinc facility is shown in the chart below:Contents

~~The~~INMETCO ~~new~~also ~~zinc~~sells ~~facility~~its ~~uses~~remelt aalloy ~~technology~~product ~~which~~produced ~~is completely different~~ from ~~that~~waste ~~used at our former Monaca smelter. The technology consists of two primary parts: (1) leaching and solvent extraction, known as the ZINCEXR process which was licensed~~ under environmental ~~an agreement with Tecnicas Reunidas and (2) electrowinning~~services, ~~melting~~back ~~and casting technology licensed under an agreement with Asturiana de Zinc. In the leach-SX section, WOX is first washed in water~~ to ~~remove soluble elements such as chlorine, potassium and sodium, then leached in a sulfuric acid solution to dissolve~~ the ~~contained~~stainless ~~zinc~~steel ~~creating a pregnant liquor solution ("PLS")~~industry. ~~The~~ ~~undissolved~~Because ~~solids~~the ~~which~~sale ~~will~~of ~~contain~~remelt ~~lead~~alloy ~~and silver are filtered and treated separately in a lead-silver recovery circuit to produce a high grade lead carbonate~~ product ~~which will be sold as a feed source to lead smelters. The PLS will be processed in a solvent extraction step in which zinc~~ is ~~selectively~~based ~~extracted~~on ~~from~~metals ~~the~~market ~~PLS using an organic solvent creating a purified zinc-loaded electrolyte solution. During this process~~prices, ~~impurities~~INMETCO’s ~~that~~revenues ~~build~~and upprofits influctuate ~~the~~with ~~system~~prevailing ~~are~~metal ~~removed in a bleed treatment step, which removes contaminants, to produce a clean effluent solution which will be discharged from the facility~~prices. ~~The~~ ~~loaded electrolyte is fed into the electrowinning process also known as the cell house or tank house.~~ In ~~this~~addition ~~process, electrical energy is applied across a series of anodes and cathodes submerged in “cells” containing the electrolyte solution causing the zinc~~ to ~~deposit on~~ the ~~surfaces~~production of the remelt ~~cathodes. As~~alloy ~~the~~in ~~zinc~~30-pound ~~metal~~ingot ~~builds up on these surfaces~~size, ~~the~~INMETCO ~~cathodes~~also ~~are~~produces periodically harvested in order to strip the zinc from their surfaces at which point the cathodes are returned to the cells to continue the deposition process. The sheets of zinc cathode are bundled and transported to an induction melting unit and automatically lowered into a ~~bath~~larger of1000-pound ~~molten zinc. The molten zinc flowing from the melting unit may be directed either to alloying furnaces to produce CGG or PW or cast directly as SHG or High Grade zinc in either slab or jumbo~~ ingot ~~molds~~on ~~for sale to galvanizers, alloyers, brass producers and other users of zinc metal~~request.

~~Our~~Sales ~~Zochem facility, which we acquired on November 1, 2011, is located in Brampton, Ontario, Canada~~ and ~~produces~~Marketing zinc oxide. The facility completed an expansion project during the first quarter of 2014 and currently has production capabilities of approximately 72,000 tons of zinc oxide per year from seven muffle type furnaces. The production process uses SHG zinc metal

10INMETCO’s marketing team consists of a sales manager and two inside sales assistants. The marketing team provides in-house INMETCO seminars in which current applicable regulations regarding storage and treatment of wastes, manifesting and transporting wastes and the recycling process are discussed. These seminars conclude with a tour of the INMETCO facility. INMETCO has also been active in exhibiting or presenting papers at outside seminars and trade shows to promote the capabilities of the business segment. The marketing team supplements these activities with advertisements in applicable industry publications, as well as on the Internet.

~~Table~~Customers ~~of Contents~~

asWhile ~~raw~~INMETCO ~~material~~has ~~which~~over is200 ~~added~~customers in total, approximately 78% of its sales were made to its top four customers during the year ~~melting~~ended ~~section~~December 31, 2015. INMETCO has had a long-term relationship with most of ~~the~~its ~~furnaces~~major customers. ~~The~~ ~~melted~~Two ~~zinc~~of isINMETCO’s ~~then~~top ~~boiled~~five ~~and~~customers ~~the~~have ~~zinc~~been ~~vapor~~customers issince ~~combusted~~INMETCO ascommenced itoperations ~~enters~~in anthe ~~oxidation~~late ~~chamber. The~~1970’s, ~~zinc~~one ~~oxide~~has isbeen ~~then~~a customer ~~collected~~since the mid 1990’s and ~~packaged~~two ~~for~~others ~~shipment~~have been customers since their own start-up in the early 2000’s and 2012.

~~Products~~Intellectual Property ~~and Services~~

WeThe ~~offer~~INMETCO aprocess ~~wide~~enables ~~variety~~the ofbusiness ~~zinc~~to ~~products~~treat and ~~services. In~~reclaim ~~2014,~~Ni-Cr-Fe webearing ~~sold~~hazardous ~~approximately~~and non-hazardous ~~129,000~~materials ~~tons~~in ofa ~~zinc~~low ~~finished~~cost, ~~products~~environmentally safe manner. The ~~following~~INMETCO ~~are~~process ~~our~~is ~~primary~~recognized by the EPA as the “Best Demonstrated Available Technology” for the treatment of steelmaking dust (i.e., low zinc ~~products~~KO61, KO62 and F006 designated hazardous waste).

~~Zinc~~Competition ~~Metal~~

~~The~~We ~~new~~believe ~~zinc facility will be capable of producing SHG, CGG and High Grade zinc, in addition to the PW zinc~~ that ~~we produced at~~ our ~~former~~recycling ~~Monaca~~facilities ~~smelter,~~provide ~~and~~an ~~will~~environmentally ~~also~~favorable ~~enable~~alternative usfor todisposing ~~potentially~~of ~~recover~~hazardous ~~other~~waste. Since ~~marketable~~1978, ~~metals~~INMETCO ~~from~~has ~~WOX~~provided ~~produced~~a ~~from EAF dust~~ recycling. Italternative ~~will also allow~~ for ~~SHG~~a ~~zinc~~wide tovariety beof ~~alloyed~~hazardous ~~with~~waste ~~other~~products ~~metals. We~~produced ~~believe this will allow us to expand into new markets, including selling to continuous galvanizers operated~~ by the specialty steel ~~mills~~industry, ~~which~~including ~~include~~steelmaking ~~some of our EAF~~ dust ~~customers~~, ~~die~~mill ~~casters~~scale and ~~potentially~~grinding ~~LME warehouses~~swarf. PWStainless ~~zinc~~steel isproducers ~~sold~~are tofaced with the same ~~hot-dip~~dust ~~galvanizing~~disposal ~~and~~problems ~~brass~~as ~~industries. The~~carbon ~~after-fabrication~~steel ~~hot-dip~~producers. ~~segment~~However, of the ~~North~~process ~~American~~requirements ~~galvanizing~~and ~~industry~~economics ~~uses~~of ~~our~~stainless PWsteelmaking ~~zinc~~dust ~~metal~~processing toare ~~provide~~different, asince ~~protective~~the ~~coating~~cost ~~to a myriad~~ of ~~fabricated~~treating ~~products,~~the ~~from~~dust ~~pipe~~may ~~and~~be ~~guard~~substantially ~~rails~~offset toby ~~heat exchangers and telecommunications towers. We also sell PW zinc metal for use in~~ the ~~production~~recovery of valuable ~~brass,~~metals asuch ~~zinc/copper~~as ~~alloy.~~nickel, Wechromium ~~believe~~and ~~that~~iron, ~~our~~which ~~operational~~are ~~standards~~recycled and ~~proximity~~returned to ~~customers~~the ~~allow~~specialty ussteel toindustry ~~deliver~~under ~~higher~~toll ~~quality metal than many of our competitors~~arrangements.

~~Zinc~~In ~~Oxide~~the metal processing industry, the most commonly used techniques for managing and disposing of hazardous waste are land disposal facilities and recycling facilities such as INMETCO’s. We believe the INMETCO process offers three key advantages over landfill: (1) it is a preferred solution from an environmental and product stewardship perspective, (2) it offers potential cost advantages through the return of valuable metals and (3) it avoids exposure to long-term contingent liabilities associated with sending waste to landfill facilities. Accordingly, we expect the INMETCO process to continue to remain the alternative of choice for the specialty steel industry. We believe INMETCO is the largest recycler of nickel-bearing hazardous waste in North America.

AsWe abelieve ~~result~~INMETCO provides new potential platforms for growth, including increasing capacity of the existing facility, growing our ~~acquisition~~share of ~~Zochem~~the onbattery ~~November~~recycling 1market, ~~2011,~~recycling weother ~~were~~industrial ~~able~~wastes to ~~broaden~~recover ~~our~~metals ~~geographic~~in ~~reach,~~addition ~~diversify~~to ~~our~~nickel ~~customer~~and ~~base~~enabling ~~and~~us ~~markets~~to ~~for~~expand ~~zinc~~internationally. ~~oxide~~We ~~and~~believe ~~provide~~there ~~added~~are ~~operational~~further ~~flexibility~~opportunities to increase capacity at INMETCO to service additional growth in nickel-bearing industrial wastes generated by U.S. stainless steel producers. We are also currently evaluating opportunities outside the United States for the use of INMETCO’s technology.

On10 ~~December 23, 2013, the zinc oxide refinery operation at our Monaca, Pennsylvania facility ceased operation. During 2014, all zinc oxide was produced by our Zochem facility.~~

WeTable sell over 20 different grades of zinc oxide with differing particle sizes, shapes, coatings and purity levels. Zinc oxide is an important ingredient in the production of tire and rubber products, chemicals, ceramics, plastics, paints, lubricating oils and pharmaceuticals. Various end uses for zinc oxide include the following.Contents

•Governmental ~~Tire~~Regulation and ~~rubber~~Environmental ~~applications.~~Issues Zinc oxide aids in the vulcanization process, acts as a strengthening and reinforcing agent, provides ultra-violet (“UV”) protection, and enhances thermal and electrical properties. There is approximately a half pound of zinc oxide in a typical automobile tire.

•Our ~~Chemical~~facilities ~~applications~~and operations are subject to various federal, state and local governmental laws and regulations with respect to the protection of the environment, including regulations relating to air and water quality and solid and hazardous waste management and disposal. InThese ~~motor~~laws ~~oil~~include the Comprehensive Environmental Response, ~~zinc~~Compensation ~~oxide~~and isLiability ~~used~~Act (“CERCLA” or “Superfund”), the Superfund Amendment Reauthorization Act, the Resource Conservation and Recovery Act (“RCRA”), the Clean Air Act (“CAA”), the Clean Water Act (“CWA”), and their state equivalents. We are also subject to ~~reduce~~various ~~oxidation~~other laws and regulations, ~~inhibit~~including ~~corrosion~~those administered by the Department of Labor, the Surface Transportation Board, the Occupational Health and ~~extend~~Safety Administration, the ~~wear~~Department of ~~automotive~~Transportation and ~~engines~~the Federal Railroad Administration, as well as certain of their state and provincial equivalents. InWe ~~plastics~~believe that we are in material compliance with applicable laws and regulations, ~~zinc~~including ~~oxide~~environmental islaws anand ~~effective~~regulations UVgoverning ~~stabilizer~~our ongoing operations, and that we have obtained or applied in a timely manner for ~~polypropylene~~all material permits and ~~polyethylene~~approvals necessary for the operation of our business.

•Our ~~Ceramics~~operations fully utilize recycled feedstocks. ~~Ceramics~~The ~~containing~~use of recycled zinc ~~oxide~~feedstocks ~~are~~preserves ~~used~~natural resources, precluding the need for mining and land reclamation and thereby operating in ~~electronic~~a ~~components~~manner consistent with the principles of sustainable development. ~~For~~Our ~~example,~~recycling services avoid the potential environmental impacts that are associated with land filling hazardous wastes. EAF dust itself is a listed hazardous waste created from the melting of steel scrap in ~~ceramic~~electric ~~varistors~~arc ~~(surge~~furnaces ~~protectors),~~by ~~zinc~~the ~~oxide~~steel ~~allows~~mini-mill ~~for~~industry. ~~high~~High temperature ~~stability~~metal recovery technology, ~~resistance~~which towe ~~electrical~~employ ~~load~~in our recycling process, ~~current~~has ~~shock~~been designated ~~and~~by ~~humidity~~the EPA as “Best Demonstrated Available Technology” for the recycling of EAF dust.

•We ~~Other~~maintain surety ~~applications.~~bonds Into ~~paints,~~address ~~zinc~~financial ~~oxide~~assurance ~~provides~~requirements ~~mold~~for potential future remediation costs and ~~mildew~~RCRA ~~protection,~~permit ~~functions~~termination asfor aseveral ~~white~~facilities. ~~pigment~~Financial ~~and~~assurance ~~provides~~is UVrequired ~~protection~~under ~~and~~RCRA ~~chalking~~permit ~~resistance.~~requirements Infor ~~pharmaceutical~~the ~~applications~~Ellwood City, ~~zinc~~Pennsylvania, Palmerton, ~~oxide~~Pennsylvania ~~operates~~and asBarnwell, aSouth ~~sunscreen~~Carolina facilities. Financial assurance, through a ~~vitamin~~surety ~~supplement~~bond, ~~and~~is aalso ~~medicinal~~required ~~ointment~~for eventual closure of our residual landfill at the Monaca, Pennsylvania facility, addressed below.

~~EAF~~We ~~Dust~~permanently ~~Recycling~~shut down our zinc production facility in Monaca, Pennsylvania in April 2014 and subsequently demolished it and sold the land in June 2015, although we retained ownership of a co-located non-hazardous captive landfill. Since December 2009, the landfill has been subject to a federal consent judgment under the CWA, requiring compliance with established effluent limitations under the applicable wastewater discharge permit. In June 2015, we entered into a consent order with the state, which requires compliance with new permit-based effluent limitations. The June 2015 consent order further requires submission of a revised closure plan for the landfill, which remains pending. We have established a total capital budget of $0.5 million for 2016 and 2017 for closure of the Monaca facility and maintain a bond in the amount of $0.4 million securing this obligation.

~~Our~~In ~~predecessor~~Bartlesville, ~~company~~Oklahoma, ~~created~~our ~~the~~predecessor ~~market~~formerly ~~for~~operated ~~EAF~~a ~~dust~~primary ~~recycling~~zinc ~~for~~processing ~~carbon~~facility ~~steel~~which ~~mini-mill~~was closed ~~producers with the development of our recycling technology~~ in the ~~early~~1990’s ~~1980s,~~and ~~which~~subsequently ~~has~~dismantled. ~~since~~Environmental ~~been~~remediation ~~designated~~work bywas ~~the~~completed ~~EPA~~in as2003 ~~the~~in ~~“Best~~connection ~~Demonstrated~~with ~~Available~~closing ~~Technology”~~this ~~for~~former ~~processing~~facility ofunder ~~EAF~~a ~~dust,~~consent aagreement ~~hazardous~~with ~~waste~~the ~~generated~~Oklahoma byDepartment ~~steel~~of ~~mini-mills~~Environmental Quality. ~~Since~~We ~~1990,~~currently manage wethis ~~have~~facility ~~recycled~~including ~~over~~groundwater ~~11.2~~monitoring ~~million~~and ~~tons~~other ofmaintenance ~~EAF~~activities ~~dust~~under ~~(equivalent~~a toRCRA ~~approximately~~post-closure 2permit.2 ~~million~~We, ~~tons~~along ofwith ~~zinc),~~two ~~representing~~other ~~the~~responsible ~~dust~~parties, ~~generated~~provide infinancial ~~the~~assurance ~~production~~for offuture ~~over~~post ~~650~~closure ~~million~~care ~~tons~~activities ofat ~~steel~~the Bartlesville facility. WeAt ~~believe~~December 31, ~~the~~2015, ~~recycling~~a ~~and~~reserve ~~conversion~~on ofour ~~EAF~~balance ~~dust~~sheet ~~reduces~~in the ~~steel~~amount ~~mini-mill’s~~of ~~exposure~~$0.6 tomillion ~~environmental~~has ~~liabilities~~been ~~which~~established ~~may~~for ~~arise~~our ~~when~~share ~~the~~of ~~EAF~~future ~~dust~~costs isassociated ~~sent~~with tothis ~~a landfill~~matter.

InOur ~~2014~~Palmerton, wePennsylvania ~~processed~~property ~~593,000~~is ~~tons~~part of ~~EAF~~a ~~dust~~CERCLA, ~~compared~~or “Superfund,” site that was added to ~~629,000~~the ~~tons~~National Priorities List in ~~2013~~1983, and has been subject to EPA investigation ever since. ~~The~~When ~~installation~~the ofPalmerton, aPennsylvania ~~new~~facility’s ~~Waelz~~assets ~~Kiln~~were inpurchased ~~Rockwood~~out inof ~~early~~bankruptcy ~~January~~in ~~2008~~December ~~increased~~2003, ~~our~~we ~~recycling~~acquired ~~capacity~~only bythose 80assets,~~000~~ ~~net~~including ~~tons~~real property, orneeded to ~~15%~~support the ongoing recycling and metal powders businesses at that location. We ~~commenced~~currently ~~operations~~hold atapproximately ~~our~~160 ~~new~~acres ~~kiln~~within ~~facility~~an inarea ~~South~~of ~~Carolina~~the inapproximately ~~2010~~1,600 ~~adding~~acres anthat ~~additional~~was ~~180,000~~previously ~~tons~~owned by the bankrupt estate of Horsehead Industries, orInc. Subject ~~31%~~to certain limited exceptions, ofa ~~EAF~~third ~~dust~~party ~~processing~~has ~~capacity. We~~contractually ~~are~~assumed ~~currently~~responsibility ~~considering~~for certain historical site contamination and associated remediation of the ~~addition~~Palmerton site, including the vast majority of athe ~~fifth~~obligations ~~dust~~arising ~~recycling~~under ~~facility~~a 2003 inconsent decree with the United States ofrelated ato ~~size~~the ~~similar~~Superfund site, and has indemnified us against certain liabilities related to environmental conditions at the property, including natural resource damages. With respect to the approximately 160 acres owned by us, we have assumed responsibility for environmental obligations resulting from our ~~three~~ongoing ~~current~~operations as well as obligations under a 1995 consent decree with the United States, which imposed multimedia obligations under RCRA, the CAA and CWA.

11Also at our Palmerton, Pennsylvania facility, the Company has responded to certain information requests from EPA relating to air emissions and maintenance activities at that facility, pursuant to Section 114 of the CAA. No notices of violation have been issued to date, but the Company cannot yet determine whether it will be required to pay fines or penalties or undertake additional action to resolve any alleged compliance deficiencies in the future.

~~Table~~11 ~~of Contents~~

two-kilnTable facilities, to increase our production capacity in response to third party growth in EAF steelmaking capacity and to reduce transportation costs for us and our customers. We also believe there is potential to gain additional market share from existing customers as a result of industry consolidation. Contents

Our Barnwell, South Carolina facility and our Rockwood, Tennessee facility have been the subject of EPA and state agency investigations alleging violations under RCRA . We have entered into consent orders with each of the state agencies for issuance of RCRA permits. In ~~June~~addition, ~~2009~~in connection with these investigations, we ~~acquired~~are currently ~~the~~working ~~EAF~~on ~~dust~~a ~~collection~~settlement ~~business~~with the U.S. Department of ~~ESOI~~Justice, EPA Region 4 and the ~~largest~~state ~~land-filler~~agencies inwith ~~our~~respect ~~market~~to both facilities. AsAlthough ~~part~~the ofvarious ~~this~~agencies ~~acquisition~~have acknowledged our efforts to cooperate with these investigations and the improvements and investments made at the facilities to address the identified issues, if settlements are not reached, the government may seek penalties and/or issue permanent injunctions against us. We cannot guarantee that we ~~purchased~~will ~~ESOI’s~~be ~~EAF~~able ~~dust~~to ~~contracts~~reach a satisfactory settlement on these matters, ~~one~~nor can we anticipate the amount of ~~which~~penalties, ~~was~~if aany, ~~ten~~that ~~year~~may ~~contract~~be ~~with~~involved, aor ~~major~~other ~~Midwestern~~actions ~~producer~~or expenditures that may be required.

~~The~~Our ~~new~~Ellwood, ~~zinc~~Pennsylvania facility ~~enables~~suffered usa tofire ~~convert~~at ~~WOX~~a ~~derived~~permitted ~~from~~storage ~~EAF~~building ~~dust~~in November 2015. Since then, the Pennsylvania Department of Environmental Protection has conducted several waste inspections and ~~other~~issued ~~recycled~~notices ~~materials~~alleging ~~into~~violations ~~SHG~~of ~~zinc~~state and ~~other~~federal ~~grades~~waste management and storage requirements. We Although we do not believe ~~the~~that ~~new~~these ~~technology~~allegations represent ~~will~~a ~~also~~material ~~allow~~risk for us, towe ~~recover~~believe ~~value~~that ~~from~~entry ~~metals~~into ~~such~~a consent order is possible in this case. We cannot speculate as ~~silver~~to ~~and~~the ~~lead~~content ~~contained~~of the consent order or in ~~EAF~~any ~~dust~~other way guarantee our view of the impact it could have on our environmental compliance costs.

~~WOX~~Our Mooresboro, North Carolina facility was subject to a waste inspection led by EPA Region 4 and ~~Zinc~~the North ~~Calcine~~Carolina Department of Environmental Quality in October 2015. In February 2016, EPA Region 4 issued an inspection report, identifying alleged RCRA violations. We have taken measures to address the alleged violations, and negotiations with EPA remain pending. Although we do not believe that these allegations represent a material risk for us, it is possible that EPA may bring some form of an enforcement action. We cannot guarantee that we will be able to reach a satisfactory settlement on this matter, nor can we anticipate the amount of penalties, if any, that may be involved, or other actions or expenditures that may be required.

InOur ~~response~~Chicago, toIllinois ~~the~~facility ~~strong~~received ~~demand~~a ~~for~~notice ~~zinc-bearing~~and ~~feed~~findings ~~materials~~of ~~and~~violation ~~attractive~~in ~~pricing~~April 2014, wefrom ~~began~~Illinois ~~selling~~EPA ~~WOX~~and ~~generated~~EPA inRegion 5 alleging violations of certain provisions of our ~~Waelz~~Chicago, ~~Kilns~~Illinois tofacility’s ~~other~~Title ~~zinc~~V ~~smelters~~Operating inPermit ~~2007~~and state and federal air regulations. We ~~plan~~Although towe ~~continue~~do ~~selling~~not ~~WOX~~believe ~~from~~that ~~time~~the toEPA’s ~~time~~allegations ~~based~~represent ona ~~market~~material ~~conditions~~risk for us, we believe that the entry into a consent order with EPA Region 5 and the Department of Justice is possible in this case. We ~~sold~~cannot ~~$2.9~~speculate ~~million~~as to the content of ~~WOX~~the consent order or in ~~2013~~any other way guarantee the outcome of these investigations and the $7impact they could have on our environmental compliance costs.8 ~~million~~In addition, in ~~2014. We~~accordance ~~will~~with ~~continue~~a recent City of Chicago ordinance, the facility is constructing a coke storage building to ~~evaluate~~prevent the ~~sale~~potential release of ~~WOX~~particulate coke to ~~third~~the environment. ~~parties until~~We ~~the~~have ~~new~~established ~~zinc~~a ~~facility~~total iscapital ~~fully~~budget ~~operational~~of $1.7 million for 2016 and 2017, for this project.

~~Currently,~~We ~~the~~may ~~WOX~~also incur ~~generated~~costs atrelated ~~our~~to ~~Palmerton,~~future ~~Pennsylvania~~compliance ~~facility~~with ~~and~~or atviolations ~~times~~of ~~WOX~~applicable ~~generated~~environmental atlaws ~~our~~and ~~other EAF dust recycling facilities~~regulations, ~~is further refined in a process called “calcining~~including,” ~~whereby~~but wenot ~~heat~~limited ~~the material~~ to ~~drive off impurities. Prior to the closure of the Monaca~~, ~~Pennsylvania~~air ~~facility~~emission inregulations ~~April~~under ~~2014,~~possible ~~the~~future ~~majority~~“Maximum ofAchievable ~~zinc~~Control ~~calcine~~Technology” ~~was~~rules relating ~~shipped~~ to ~~that~~our ~~facility~~operations orsuch atas ~~certain~~regulations ~~time~~relating ~~periods a portion was sold~~ to ~~other~~non-ferrous ~~zinc~~secondary ~~refineries~~metals ~~around the world~~production. We ~~sold~~Our ~~$0.6~~total ~~million~~cost of ~~zinc~~environmental ~~calcine~~compliance ~~during~~at ~~2013. During~~any ~~2014,~~time ~~due~~depends toon ~~the~~a ~~reduced~~variety ~~production and eventual closure~~ of ~~the~~regulatory, ~~Monaca~~legal, ~~facility~~technical inand ~~April~~factual ~~2014~~issues, ~~and~~some ~~the~~of ~~ramp-up~~which ofcannot be ~~production~~anticipated. atAdditional ~~the~~environmental ~~new~~issues ~~zinc~~could ~~facility~~arise, weor ~~sold~~laws ~~$71.0~~and ~~million~~regulations ofcould ~~zinc~~be ~~calcine.~~passed ~~The~~and ~~calcining~~promulgated, ~~operation~~resulting ~~will~~in beadditional ~~shut~~costs, ~~down~~which ~~when~~our ~~Mooresboro~~reserves ~~begins~~may tonot ~~consistently~~cover ~~achieve~~and awhich ~~production~~could ~~capacity~~materially ~~utilization~~harm ~~level~~our ofoperating ~~approximately 75%~~results.

~~Zinc~~Employees ~~Powder~~

~~Our~~As ~~zinc powder is sold for use in a variety~~ of December 31, ~~chemical~~2015, ~~metallurgical~~we ~~and~~employed ~~battery~~716 ~~applications~~persons asat ~~well as for use in corrosion-resistant coating applications. Zinc powder is manufactured by~~ the ~~atomization~~following ~~of molten zinc~~locations.

We manufacture the following basic lines of powders at our Palmerton facility.


Location	Salaried Personnel		Hourly Personnel		Union Contract Expiration
Pittsburgh, Pennsylvania		48		—		N/A
Bartlesville, Oklahoma		1		—		N/A
Calumet, Illinois		14		52		08/04/17
Palmerton, Pennsylvania		20		80		04/27/19
Palmerton (Chestnut Ridge Railroad), Pennsylvania		—		3		12/15/16
Rockwood, Tennessee		13		49		07/01/19
Barnwell, South Carolina		11		45		N/A
Ellwood City, Pennsylvania		28		66		10/31/16
Mooresboro, North Carolina (a)		63		179		N/A
Brampton, Ontario Canada		19		25		06/30/20

Total		217		499

•12 ~~Special Zinc Powders. These are used in general chemical and metallurgical applications, and in friction applications, such as brake linings for automobiles.~~

•Table Battery Grade Zinc Powders. These are used in most types of alkaline batteries, as well as mercuric oxide, silver oxide and zinc-air batteries.Contents

~~On November 16, 2012, we acquired Horsehead Zinc Powder, LLC~~ (~~"HZP"). Horsehead had been~~ a ~~long-term supplier of Special Special High Grade ("SSHG"~~) ~~zinc~~The ~~metal~~Mooresboro tofacility ~~this business which~~ was ~~co-located~~idled aton ~~the site of our former Monaca~~January 22, ~~Pennsylvania~~2016 ~~facility. During~~and ~~the~~is ~~first~~currently at ~~quarter of 2014, HZP production was idled due to~~ a ~~lack~~“care ~~of raw material supply~~ and ~~all~~maintenance oflevel” ~~our zinc production was consolidated into the Palmerton facility~~only. ~~Shipments,~~ ~~however, continued through the end of April 2014.~~ The ~~HZP production~~ facility ~~was~~currently ~~subsequently~~employs ~~demolished~~approximately ~~under~~29 ansalary ~~agreement~~and ~~with~~3 ~~Shell~~hourly ~~Chemical~~persons.

InThere ~~December~~have ~~2013,~~not webeen ~~sold~~any ~~our~~other ~~copper-based~~material ~~powders~~changes ~~business~~since ~~located in Palmerton~~December 31, ~~Pennsylvania.~~2015 ~~This~~in ~~business~~the ~~unit~~number ~~was~~or ~~considered~~mix ~~to be non-core and was not making a positive contribution toward earnings. Certain assets and the production~~ of ~~copper~~our ~~powders was relocated by the purchaser~~employees.

12The majority of our hourly personnel are unionized. Hourly workers receive medical, dental and prescription drug benefits. We do not have defined benefit plans for hourly or salaried employees, except at our Brampton, Ontario Canada site, which was acquired on November 1, 2011. These defined benefit plans include 30 active employees and are currently frozen to additional participants. We have a 401(k) plan for both our hourly and salaried employees at all sites in the United States. Employees at our Brampton, Ontario Canada facility hired after June 30, 2012 are eligible to participate in a retirement plan similar to a 401(k). We have no company-paid medical plan for retirees. Our labor contracts provide for a company contribution and in most cases a company match, which varies from contract to contract. We believe we have satisfactory relations with our employees.

~~Table~~ITEM of1A. ~~Contents~~RISK FACTORS

~~Sales~~In addition to the other information in this Annual Report on Form 10-K, the following risk factors should be read carefully in connection with evaluating our business and ~~Marketing~~the forward-looking information contained in this Annual Report on Form 10-K. Any of the following risks could materially adversely affect our business, operating results, financial condition and the actual outcome of matters as to which we have made forward-looking statements in this Annual Report on Form 10-K. There may be additional risks and uncertainties that are not presently known or that we do not currently consider to be significant that may adversely affect our business, performance or financial condition in the future.

~~Zinc~~Risks ~~Products~~Related ~~and~~to ~~Services~~the Chapter ~~sales~~11 ~~and~~Cases ~~marketing staff consists of:~~

•We ahave ~~sales~~filed ~~and~~voluntary ~~marketing~~petitions ~~group~~for ~~comprised~~relief ofunder ~~sales~~the ~~professionals~~Bankruptcy ~~whose~~Code ~~goal is to develop~~ and ~~maintain~~are ~~excellent~~subject ~~customer~~to ~~relationships~~the risks and uncertainties ~~provide~~associated ~~key~~with ~~market~~bankruptcy ~~analysis;~~cases.

•On the Petition Date, we and certain of our direct and indirect wholly owned subsidiaries filed voluntary petitions for reorganization under Chapter 11 of the Bankruptcy Code. As a ~~customer~~result, ~~service~~our ~~department~~business ~~responsible~~and operations are subject to various risks, including but not limited to the following: (i) incurring substantial costs for ~~processing~~fees ~~zinc~~and ~~orders~~other expenses associated with the Chapter 11 Cases and the Canadian Proceedings, ~~scheduling~~(ii) the ~~product~~attendant ~~shipments~~difficulties of operating our business while attempting to reorganize the business in bankruptcy, (iii) potential increased difficulty in retaining and ~~answering~~motivating ~~customer~~our ~~inquiries;~~key executives and employees through the process of reorganization, and potential increased difficulty in attracting new employees, and (iv) the effects of significant time and effort required to be spent by our senior management with respect to the bankruptcy and restructuring activities rather than focusing exclusively on business operations.

•We amay ~~technical~~not ~~service~~be ~~staff~~able ~~highly~~to ~~trained~~respond timely to ~~assist~~certain ~~zinc~~events ~~customers~~or ~~with~~take ~~specification~~advantage ~~development,~~of ~~new~~certain ~~applications,~~opportunities ~~process~~due ~~improvements~~to ~~and~~the ~~on-site~~need ~~troubleshooting~~for ~~assistance~~Bankruptcy ~~when needed~~Court approval.

~~Our~~Transactions ~~process~~by ~~engineering~~us ~~group~~outside ~~provides~~the ~~additional~~ordinary ~~technical~~course ~~help~~of tobusiness ~~our~~are ~~EAF~~subject ~~clients~~to ~~with~~the ~~monthly~~prior ~~EAF~~approval ~~analytical~~of ~~information~~the Bankruptcy Court and ~~assistance~~ with ~~any~~respect ~~problems~~to ~~encountered~~property onlocated ~~EAF~~in ~~dust chemistry~~Canada, ~~transportation~~the ~~and~~Canadian ~~environmental~~Court, ~~matters. Our~~which ~~quality~~may ~~assurance~~limit ~~department~~our ~~provides~~ability ~~extensive~~to ~~laboratory~~respond ~~services~~timely ~~critical~~ to ~~maintaining~~certain ~~in-plant~~events ~~process~~or ~~control~~take ~~and~~advantage ~~providing customer support by certifying compliance to hundreds~~ of ~~unique~~certain ~~product specifications~~opportunities. ~~Our~~We ~~laboratory~~may ~~also~~not ~~offers~~be ~~sales~~able ~~and~~to ~~technical~~obtain ~~services~~Bankruptcy ~~support~~Court byapproval or ~~assisting~~such inapproval ~~new~~may ~~product~~be ~~developments~~delayed ~~and~~or ~~troubleshooting~~conditioned ~~various~~with ~~application~~respect ~~and~~to ~~processing~~actions ~~issues~~we ~~both~~seek ~~in-plant~~to ~~and~~undertake ~~with~~during ~~specific~~the ~~customers.~~pendency ~~We also rely on a network~~ of ~~distributors~~the ~~with~~Chapter ~~warehouses~~11 ~~throughout~~Cases ~~North~~or ~~America~~Canadian ~~that assist us with supporting smaller customers~~Proceedings.

~~Customers~~There can be no assurance as to our ability to maintain sufficient financing sources to fund our business and meet future obligations during the Chapter 11 Cases.

~~Our~~There ~~new~~can ~~zinc~~be ~~facility~~no isassurance ~~capable~~as ofto ~~producing~~our ~~SHG,~~ability ~~CGG,~~to ~~and~~maintain ~~High~~sufficient ~~Grade~~financing ~~zinc, in addition~~ sources to ~~the~~fund PWour ~~zinc~~business ~~that~~and wemeet ~~produced~~future atobligations ~~our~~during ~~former~~the ~~Monaca~~Chapter ~~smelter~~11 Cases. We ~~also~~intend ~~will~~to befinance ~~able~~our tooperations ~~potentially~~during ~~recover~~our ~~other~~reorganization ~~marketable~~using ~~metals~~funds from ~~WOX~~operations ~~produced~~and from ~~EAF~~the ~~dust~~DIP ~~recycling~~Facility. ~~The~~ ~~new~~There ~~zinc~~can ~~facility also allows for SHG zinc to~~ be ~~alloyed~~no ~~with~~assurance ~~other~~that ~~metals. We~~we ~~believe this~~ will ~~allow~~be usable to operate ~~expand~~pursuant ~~into new markets, including selling~~ to ~~continuous~~the ~~galvanizers~~terms ~~operated~~of by the ~~steel~~DIP ~~mills~~Facility, ~~which~~including ~~include~~the ~~some~~financial ofcovenants ~~our~~and ~~EAF~~restrictions ~~dust~~contained ~~customers~~therein, ~~die~~or ~~casters~~to negotiate and ~~potentially~~obtain ~~LME~~necessary ~~warehouses. The~~approvals, PWamendments, ~~zinc~~waivers, toor beother ~~produced~~types atof ~~the new zinc facility~~modifications, is ~~purchased by galvanizers~~ and ~~brass~~to ~~producers~~otherwise fund and execute ~~the~~our ~~after-fabrication~~business ~~hot-dip~~plans ~~segment~~throughout of the ~~North~~duration ~~American galvanizing industry. In many cases, these customers are also suppliers~~ of ~~secondary~~the ~~materials,~~Chapter ~~including~~11 ~~zinc~~Cases ~~remnants~~and ofCanadian ~~steel galvanizing processes, to us~~Proceedings.

We13 sell zinc oxide to over 250 different customers under contract as well as on a spot basis, principally to manufacturers of tire and rubber products, lubricating oils, chemicals, paints, ceramics, plastics and pharmaceuticals.

WeTable typicallyof enter into multi-year service contracts with steel mini-mills to recycle their EAF dust. We provide our EAF dust recycling services to over 45 steel producing facilities.Contents

~~Raw~~We ~~Material~~May Not Be Able to Consummate our Plan and Emerge from Chapter 11

~~The~~Although ~~majority of feedstock for~~ the ~~new~~Bankruptcy ~~zinc~~Court ~~facility~~entered ~~will~~an beorder ~~supplied~~confirming bythe ~~our~~Plan ~~EAF~~on ~~dust~~September ~~recycling~~9, ~~plants. The remaining portion of raw material feed will be comprised of purchased zinc secondaries~~2016, ~~which~~we are ~~principally~~obliged ~~zinc-containing~~to ~~remnants~~take ofadditional steps ~~steel galvanizing processes, including skimmings produced by several of our metal customers. The prices of zinc secondaries vary according~~ to consummate the ~~amount~~Plan ~~of recoverable zinc contained,~~ and ~~provide~~emerge ~~us with a diverse portfolio of low cost inputs~~ from ~~which~~Chapter to11 ~~choose~~protection. InThere ~~addition~~can tobe ~~the~~no ~~skims~~guaranty ~~from~~that ~~the~~such ~~galvanizing~~steps ~~industry, we~~ can ~~purchase~~be ~~other~~achieved ~~types of zinc-bearing residues from the zinc, brass~~ and/or ~~alloying~~that ~~industries.~~we ~~Many~~will ofbe ~~these~~able ~~materials~~to ~~can~~emerge ~~be acquired~~ from ~~our~~Chapter ~~own~~11 ~~customers.~~within ~~We also buy WOX from~~ the ~~other~~milestones ~~U.S.~~filed ~~based~~by ~~EAF~~our ~~dust~~DIP ~~recycler.~~Credit InAgreement ~~addition,~~or wethe ~~also~~Unit Purchase ~~have long standing relationships with zinc brokers in North America~~Agreement, ~~Europe and South America~~respectively. ~~These brokers in some cases act as an agent for us and are favorably located to supply us with reliable and cost effective zinc feedstock.~~

InTo ~~December 2013, we entered into~~ the ~~ThirtyOx~~extent ~~joint~~that ~~venture with Imperial Zinc Corp. for~~ the ~~acquisition~~terms ~~and~~or ~~processing~~conditions of ~~zinc~~the ~~bearing~~DIP ~~secondary~~Credit ~~materials.~~Agreement ~~The~~or ~~processing operation is located in North Carolina near~~ the ~~new~~Unit Purchase ~~zinc~~Agreement, ~~facility~~respectively, ~~and~~are ~~became~~not ~~operational~~satisfied, inor ~~August~~events ~~2014. ThirtyOx~~giving isrise ~~expected~~ to ~~supply~~the atermination ~~portion~~ of ~~the~~such ~~incremental~~agreements ~~zinc~~occur, ~~feed required by~~ the ~~new~~Debtors ~~zinc~~could ~~facility~~be byunable ~~recovering~~to ~~secondary~~emerge ~~zinc oxides~~ from ~~the~~Chapter ~~residues~~11 ~~generated by galvanizers, die-casters~~ and/or ~~other~~may ~~users of zinc metal. Our anticipated investment is expected to~~ be ~~less~~obliged ~~than $2.0 million. At December 31, 2014, we have contributed $0.8 million~~ to ~~this joint venture~~liquidate.

~~Raw~~We ~~materials~~are ~~used~~subject into ~~our~~risks ~~Zochem~~and ~~facility~~uncertainties ~~consist~~with ~~entirely~~respect to the actions and decisions of ~~SHG~~our ~~zinc~~creditors ~~metal~~and ~~purchased~~other ~~from~~third ~~several~~parties ~~suppliers. The~~who ~~price~~have interests ofin ~~these~~our ~~metal~~Chapter ~~blocks~~11 isCases ~~based~~that onmay ~~the~~be ~~LME~~inconsistent ~~zinc~~with ~~price~~our plans.

13We are subject to risks and uncertainties with respect to the actions and decisions of creditors and other third parties who have interests in our Chapter 11 Cases that may be inconsistent with our plans. These risks and uncertainties could affect our business and operations in various ways and may significantly increase the duration of the Chapter 11 Cases. Because of the risks and uncertainties associated with Chapter 11 Cases, we cannot predict or quantify the ultimate impact that events occurring during the Chapter 11 Cases may have on our business, cash flows, liquidity, financial condition and results of operations, nor can we predict the ultimate impact that events occurring during the Chapter 11 Cases may have on our corporate or capital structure.

~~Table~~Additionally, ofthird ~~Contents~~parties may seek and obtain Bankruptcy Court approval to terminate or shorten the exclusivity period for us to propose and confirm the Plan or to convert the cases to Chapter 7 cases.

~~Intellectual~~We ~~Property~~may be unable to continue as a going concern.

WeThe ~~possess~~Chapter ~~proprietary~~11 ~~technical~~Cases ~~expertise~~may ~~and~~adversely ~~know-how~~affect ~~related~~our tobusiness ~~EAF~~prospects ~~dust recycling~~ and ~~zinc~~our ~~production,~~ability ~~particularly~~to ~~zinc production using recycled feedstocks~~operate. ~~Our~~The ~~proprietary~~uncertainty regarding ~~know-how~~the ~~includes~~eventual ~~production~~outcome ~~methods~~of ~~for~~our ~~zinc~~restructuring, ~~oxide~~ and ~~micro-fine~~the ~~zinc~~effect ~~oxides and widely varying customer specifications. As a major supplier~~ of ~~zinc metal and~~ other ~~zinc-based~~unknown ~~products~~adverse tofactors ~~industrial~~could ~~and~~threaten ~~commercial markets, we emphasize developing intellectual property and protecting~~ our ~~rights~~existence inas ~~our~~a ~~processes~~going-concern. ~~However,~~Continuing ~~the~~on ~~scope~~a ofgoing-concern ~~protection~~basis ~~afforded~~of byour ~~intellectual~~business ~~property~~is ~~rights,~~dependent ~~including ours~~upon, isamong ~~often~~other ~~uncertain and involves complex legal and factual issues. Also~~things, obtaining ~~there~~Bankruptcy ~~can~~Court beapproval noof ~~assurance~~the ~~that~~Plan ~~intellectual~~and ~~property~~Canadian ~~rights~~Court ~~will~~recognition ~~not~~of bethe ~~infringed or designed around by others. In addition~~same, wemaintaining ~~may~~the ~~not~~support ~~elect~~of tokey ~~pursue~~vendors anand ~~infringer~~customers, ~~due~~and toretaining ~~the~~key ~~high~~personnel, ~~costs~~along ~~and uncertainties associated~~ with ~~litigation.~~financial, ~~Further~~business, ~~there~~and ~~can~~other befactors, nomany ~~assurance~~of ~~that~~which ~~courts~~are beyond ~~will~~our ~~ultimately hold issued intellectual property rights to be valid and enforceable~~control.

~~Competition~~The accompanying consolidated financial statements to this Annual Report on Form 10-K have been prepared assuming that we will continue as a going concern. As discussed in Note A to the financial statements, the Company has experienced working capital deficits, losses from continuing operations, and defaults and cross-defaults under various credit agreements and filed for bankruptcy protection on February 2, 2016. Our independent registered public accountants, BDO USA, LLP have included an emphasis of matter paragraph in their auditors’ report which states certain conditions exist which raise substantial doubt about our ability to continue as a going concern in relation to the foregoing. Our plans in regard to these matters are described in Note A. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. See “Report of Independent Registered Public Accounting Firm” included elsewhere in this Annual Report on Form 10-K.

WeRisks ~~believe~~Related ~~that~~to we are a unique business, having no direct competitor that recycles similar secondary materials into finished zinc products in North America. Our primary competitor in the zinc oxide segment is U.S. Zinc Corporation (“US Zinc”), a wholly-owned subsidiary of Votorantim Metals, Ltda. On November 1, 2011, we acquired Zochem, a wholly owned subsidiary of Hudson Bay Mining and Smelting Co. Limited ("Hudbay") which was previously one of our ~~competitors~~Business ~~in the zinc oxide business. US Zinc, located in the middle-southern states of the United States, is also a zinc recycler and our primary competitor but lacks our integrated processing capabilities.~~

~~Historically,~~Declines ~~approximately 75% of the zinc metal consumed~~ in the ~~United~~prices ~~States~~of has been imported. We enjoy a domestic freight and reliability advantage over foreign competitors with respect to U.S. customers. Hudbay, Teck Cominco Limited, Nyrstar, Glencore and Penoles are the primary zinc metal producers in the North American market. The vast majority of the metal produced by these companies is used by continuous galvanizers in the coating of steel sheet products. In addition, these producers have mining and ~~smelting~~nickel ~~operations. We~~ have nohad ~~mining~~a ~~operations~~significant ~~nor,~~adverse asimpact ofon ~~May~~our 1liquidity, ~~2014,~~operating noresults ~~smelting~~and ~~operations~~financial condition.

WeIn ~~compete~~2015, ~~for~~we ~~EAF~~derived ~~dust~~most ~~management~~of ~~contracts~~our ~~primarily~~revenue ~~with~~from ~~one~~the ~~other~~sale ~~domestic recycler~~ of ~~EAF~~zinc ~~dust~~ and to a ~~lesser~~portion ~~extent~~of ~~with~~our ~~landfill~~revenue ~~operators~~from nickel-based products. ~~The~~ ~~domestic~~Changes ~~recycler~~in isthe ~~Steel~~market ~~Dust~~prices ~~Recycling.~~of ~~Steel~~zinc ~~Dust~~and ~~Recycling~~nickel ~~commenced~~impact ~~operations during~~ the ~~second~~selling ~~quarter~~prices of ~~2008~~our products, and ~~was~~therefore ~~subsequently~~our ~~acquired~~liquidity inand ~~October~~profitability ~~2009~~are significantly affected by ~~Zinc~~decreased ~~Nacional,~~zinc aand ~~Mexico-based~~nickel ~~recycler~~prices. WeFor ~~expect~~example, tofrom ~~see~~May 2015 ~~new~~through ~~entrants~~December 31, ~~once~~2015, ~~again~~the ~~explore~~price ~~opportunities~~of inzinc ~~this~~fell ~~area~~approximately ~~when~~39%, ~~zinc~~reaching ~~prices~~a ~~are~~six-year atlow orin ~~near~~December ~~historical~~2015. ~~high~~The ~~levels.~~price ~~Our~~of ~~proven~~nickel ~~reliability,~~fell ~~expanded~~approximately ~~processing~~59% ~~capacity~~from ~~and~~May ~~customer~~2014 ~~service~~to ~~have~~December ~~helped~~2015. usAlthough ~~maintain~~prices ~~long-standing~~have ~~customer~~recently ~~relationships.~~improved, ~~Many~~if the prices of ~~our~~zinc ~~EAF~~and ~~dust~~nickel ~~customers~~do ~~have~~not ~~been~~return ~~under~~to ~~contract~~historical ~~with~~levels usand ~~since~~we ~~our~~are ~~predecessor~~unable ~~began~~to ~~recycling~~restart ~~EAF~~and ~~dust~~improve in the ~~1980s. In~~production ~~June~~rate ofand ~~2009,~~operational wecapabilities ~~acquired~~at the ~~EAF~~Mooresboro ~~dust~~facility, ~~collection~~our ~~contracts~~liquidity, financial condition and results of ~~ESOI~~operations will be materially and adversely affected.

~~Nickel~~Market ~~Products~~prices of zinc and ~~Services~~nickel are dependent upon a variety of factors over which we have no control, including:

~~Recycling~~• ~~Operations~~the ~~for~~balance ~~Nickel-Bearing~~between ~~Waste~~supply and demand;

~~Our~~• ~~INMETCO~~availability ~~facility located in Ellwood City, Pennsylvania, operates a high temperature metals recovery facility, which utilizes a combination rotary hearth furnace~~ and ~~electric~~relative ~~arc~~pricing ~~smelting furnace to recover nickel, chromium and iron, along with smaller amounts~~ of ~~other metals, from a variety of~~ metal~~-bearing~~ waste materials, generated primarily by the specialty steel industry. INMETCO’s main product is a nickel-chromium-iron (“Ni-Cr-Fe”) remelt alloy ingot that is used as a feedstock to produce stainless and specialty steels. INMETCO also recycles Ni-Cd batteries and alkaline batteries in conjunction with Horsehead.substitutes;

~~The~~• ~~INMETCO~~labor ~~process for treating Ni-Cr-Fe metals waste is comprised of feed preparation, blending and pelletizing, thermal reduction and smelting and casting.~~costs;

~~The~~• ~~first~~import ~~portion of the INMETCO process consists of material preparation, storage, blending, feeding~~ and ~~pelletizing. INMETCO~~export receives the various wastes and pretreats them when necessary to ensure a uniform size of the raw material. These materials, as well as flue dust and carbon, are pelletized. Pellets are transferred to the Rotary Hearth Furnace (“RHF”) for the reduction of some oxidized metal to its metallic form. Reduced pellets are fed to the EAF for production of Ni-Cr-Fe remelt alloy. Slag discharged from the EAF is processed and sold primarily as road aggregate. restrictions;

In• ~~2013,~~energy ~~we idled the cadmium recovery facility at INMETCO by modifying the process to permit direct charging of nickel-cadmium batteries to the rotary hearth furnace.~~ prices;

14• economic conditions in the U.S., China, and elsewhere in the world;

~~Table~~• ofenvironmental ~~Contents~~laws and regulations;

~~The~~• ~~chart~~weather; ~~below describes the INMETCO flow of operations, beginning with raw materials, continuing through the process~~ and ~~identifying products.~~

~~Products~~• ~~and~~the ~~Services~~effect of financial commodity speculations.

~~INMETCO~~14 ~~provides recycling services to its customers under two types of fee arrangements: toll processing arrangements and environmental services arrangements.~~

TollingTable Servicesof Contents

~~Under~~Declines in the ~~tolling~~price ~~arrangement, INMETCO charges a processing fee per ton~~ of ~~waste~~zinc ~~received~~have ~~and~~had ~~returns~~ a ~~remelt~~negative ~~alloy~~impact ~~product based~~ on ~~the~~our ~~waste’s~~operations ~~metal~~in ~~content~~the past and ~~INMETCO’s historical metal recovery factors for similar waste products. INMETCO serves almost all of the major austenitic stainless steel manufacturers~~ in the ~~United~~months ~~States~~leading inup ~~its~~to ~~tolling segment. We believe INMETCO is~~ the ~~only~~Petition ~~recycler~~Date, ofand ~~stainless~~future ~~steel~~declines ~~wastes~~could inhave ~~North~~further ~~America~~negative ~~and~~impact ~~that INMETCO’s customers rely~~ on ~~its~~our ~~services~~future tofinancial ~~promote~~condition ~~sustainable~~or ~~business~~results ~~practices, to avoid potential environmental liabilities associated with disposing~~ of ~~hazardous~~operations. ~~wastes~~Market atconditions ~~landfills~~beyond ~~and~~our tocontrol ~~take~~determine ~~advantage of~~ the ~~return~~prices offor ~~valuable~~our ~~metals from their metal-bearing waste~~ products~~. Most of INMETCO’s tolling customers have signed long-term~~, and ~~exclusive contracts, under which INMETCO processes their metal-bearing wastes. INMETCO receives four main nickel-containing waste materials from~~ the ~~specialty~~price ~~steel~~for ~~industry,~~any ~~which~~one ~~support~~or ~~the~~more ~~“tolling” segment~~ of ~~the~~our ~~business. These~~products ~~materials~~may ~~are~~fall ~~flue~~below ~~dust,~~our ~~mill~~production ~~scale~~costs, ~~grinding~~requiring ~~swarf~~us ~~and~~to ~~shot blast dust and are received~~ either inincur ashort-term ~~dry~~losses ~~form or a wet form containing oil~~ and/or ~~water. Furnace~~idle ~~baghouse dust~~ or ~~flue~~permanently ~~dust~~shut isdown ~~generated~~production ~~during the melting and refining steps in the manufacture of stainless steel~~capacity.

~~Environmental~~If ~~Services~~we fail to implement our business plan and financial restructuring strategy, our financial condition and results of operations could be materially and adversely affected.

~~Under~~Our ~~the~~ability ~~environmental~~to ~~fee~~achieve ~~arrangement,~~our ~~INMETCO~~business ~~acquires~~plan ~~waste~~and ~~materials~~financial ~~and~~restructuring strategy ~~processes~~is ~~those~~subject ~~materials~~to ~~with~~a novariety ~~obligation~~of tofactors, ~~return~~many ~~any~~of ~~product~~which toare ~~the~~beyond ~~customer~~our control. ~~Depending~~For onexample, ~~the~~following ~~state~~restructuring, offactors ~~the~~such ~~metals~~as ~~markets~~increased competition, ~~INMETCO~~legal ~~either~~and ~~charges~~regulatory adevelopments, ~~fee~~general economic conditions or ~~pays~~increased tooperating costs ~~acquire~~could ~~environmental~~prevent ~~services~~us ~~materials. These~~from ~~materials~~increasing ~~include~~our ~~batteries~~capacity, ~~and~~implementing ~~specialty~~further ~~steel~~productivity ~~industry~~improvements, ~~wastes. All~~investing ~~battery~~in ~~chemistries~~technology ~~are~~upgrades ~~accommodated~~or continuing to enhance our business and product mix. ~~Batteries~~ ~~with~~In ~~chemistry~~addition, ~~compatible~~the ~~with~~restart and remediation of the ~~INMETCO~~issues existing ~~process~~at ~~are~~the ~~processed~~Mooresboro ~~directly~~facility ~~while~~may ~~non-compatible~~take ~~types~~longer ~~are~~and ~~sent~~prove to ~~third~~be ~~party~~substantially ~~recyclers~~more ~~for~~expensive ~~processing~~than we currently estimate. ~~Recycling~~In ofsuch ~~household~~event, ~~alkaline~~we ~~batteries~~may ~~has~~be ~~become~~unable ato ~~growing~~restructure ~~market~~our ~~that~~debt ~~results~~or inbe ~~scrap~~forced ~~steel~~to assell aall ~~feed~~or toparts ~~INMETCO~~of our business, develop and implement ~~zinc~~further ~~concentrate~~restructuring ~~used~~plans, byor ~~Horsehead. Specialty~~become ~~steel~~subject ~~industry~~to further insolvency proceedings.

15Any failure to successfully implement our business plan and financial restructuring strategy, including for any of the above reasons, could materially and adversely affect our financial condition and results of operations. We may, in addition, decide to alter or discontinue certain aspects of our business strategy at any time.

~~Table~~Impairment charges could adversely affect our results of ~~Contents~~operations.

~~wastes~~Long ~~include~~lived ~~flue~~assets, ~~dust~~which include property, ~~mill~~plant ~~scale~~and equipment as well as definite life intangible assets, ~~grinding~~are reviewed ~~swarf~~for ~~and~~impairment ~~pickling~~when ~~filter~~events ~~cake~~and ~~along~~circumstances ~~with~~indicate athat ~~wide~~the ~~variety~~carrying amount of ~~other~~an ~~nickel-bearing~~asset ~~wastes. Revenues~~may ~~are~~not ~~derived~~be ~~from~~recoverable. ~~these~~If ~~materials~~we ~~through~~determine that the ~~sale~~fair value of ~~the~~any ~~derived~~of ~~products~~these ~~into~~assets is less than the ~~appropriate~~value ~~markets~~recorded ason ~~well~~our asbalance ~~scrap~~sheet, ~~sales~~we ~~and~~will incur ~~brokerage~~non-cash ~~activities.~~impairment Nocharges ~~materials~~that ~~are~~could ~~sent~~adversely toaffect ~~landfills~~our results of operations.

~~Remelt~~During ~~Alloy~~the fourth quarter of 2015, we assessed the carrying value of the Mooresboro Facilities’ fixed assets, and determined that the future estimated cash flow did not support the carrying amount. Therefore, we recorded a pre-tax, non-cash asset impairment charge of $527 million. During the year ended December 31, 2015, the Company’s operation were significantly impacted due to the dramatic decline in zinc nickel and other commodity prices, continuing issues that delayed ramp-up of the Mooresboro zinc facility, and lower EAF dust receipts reflecting weaker steel production. If such estimates or their related assumptions change in subsequent periods or if actual cash flows or other market measures are below management’s estimates, the Company may be required to record impairment charges for these assets not previously recorded or additional impairments on assets already recorded.

~~INMETCO~~We ~~sells~~may ~~its~~be ~~remelt~~unable ~~alloy~~to ~~product,~~resolve ~~produced~~the ~~from~~operational ~~waste~~issues ~~accepted~~with asrespect anto ~~environmental~~our ~~service,~~Mooresboro ~~back~~facility toand/we ~~the~~may ~~stainless~~experience ~~steel~~new ~~industry.~~issues ~~Because~~that ~~the~~may cause ~~sale~~further ofdelays, ~~remelt~~each ~~alloy~~of ~~product~~which iswould ~~based~~materially onharm ~~metals~~our ~~market~~profitability, ~~prices~~liquidity, ~~INMETCO’s~~financial ~~revenues~~condition and ~~profits fluctuate with prevailing metal prices~~operations.

InThe ~~addition~~Mooresboro facility experienced significant operational difficulties prior to ~~the~~its idling that resulted in low production and several interruptions, and prevented it from achieving its design capacity. Some of the ~~remelt~~difficulties ~~alloy~~that inwe ~~30-pound~~have ~~ingot~~faced ~~size~~are a bleed treatment system with insufficient capacity, ~~INMETCO~~inadequate ~~also~~removal ~~produces~~of asolids ~~larger~~from ~~1000-pound~~the ~~ingot~~leach onclarifier ~~request~~overflow, poor current efficiency caused by occasional excursion in electrolyte chemistry, and intermittent equipment reliability issues related to plugging and failure of process lines, pumps and filters.

~~Sales~~Although we believe that we can succeed in making the necessary repairs and ~~Marketing~~upgrades to the Mooresboro facility, which will enable us to ultimately operate at or near full capacity, there are significant risks that such efforts will be unsuccessful and that we will continue to suffer a loss of cash flow due to operational issues at the Mooresboro facility. We cannot foresee the severity of known issues, guarantee that our efforts to remediate known issues will be sufficient, or guarantee that we will be able to remediate such issues in a timely or cost-effective manner. In addition, we cannot guarantee that we will not encounter additional issues that result in further delays and unexpected costs. In that event, we may be unable to restructure our debt or be forced to sell all or parts of our business, develop and implement further restructuring plans, or become subject to further insolvency proceedings. The Mooresboro facility is in an idle state and currently there is no definitive plan to resume operations in the near future.

~~INMETCO’s~~We ~~marketing~~may ~~team~~not ~~consists~~have ofsufficient afunds ~~sales~~to ~~manager~~correct ~~and~~operational ~~two~~issues ~~inside~~experienced ~~sales~~by ~~assistants.~~our ~~The~~Mooresboro ~~marketing~~facility, ~~team~~such ~~provides~~as ~~in-house~~the ~~INMETCO~~remediation ~~seminars in which current applicable regulations regarding storage and treatment~~ of equipment ~~wastes,~~failures ~~manifesting~~ and ~~transporting wastes and~~ the ~~recycling~~replacement ~~process~~or ~~are~~design ~~discussed. These~~of ~~seminars~~portions ~~conclude with a tour~~ of the ~~INMETCO~~ facility. ~~INMETCO~~ has also been active in exhibiting or presenting papers at outside seminars and trade shows to promote the capabilities of the business segment. The marketing team supplements these activities with advertisements in applicable industry publications, as well as on the Internet.

~~Customers~~Correcting some of the operational issues experienced by our Mooresboro facility requires remediating equipment failures and replacing or redesigning portions of the facility. We may not be able to correct these operational issues, new unforeseen operational issues may appear and the costs of correcting such issues may be greater than expected. We may not have the financial resources necessary, or be able to obtain financing, to address any operational issues at our Mooresboro facility. In that case, our liquidity, financial condition and operations would continue to be materially adversely affected.

~~While~~The ~~INMETCO~~projected ~~has~~benefits ~~over~~from ~~200~~the ~~customers~~Mooresboro infacility may ~~total,~~fail ~~approximately 77% of its sales were made~~ to ~~its top three customers during the year ended December 31, 2014~~materialize. INMETCO has had a long-term relationship with most of its major customers. Two of INMETCO's top five customers have been customers since INMETCO commenced operations in the late 1970's, one has been a customer since the mid 1980's and two others have been customers since their own start-up in the early 2000's and 2012.

~~Intellectual~~The ~~Property~~Mooresboro facility is in an idle state and currently there is no definitive plan to resume operations in the near future. Even if we are able to restart the Mooresboro facility and resume operations, the benefits that we have projected to receive from the Mooresboro facility are based on numerous assumptions that, if incorrect, could negatively impact such projected benefits. Specifically, the technology used at the Mooresboro facility has only been implemented in a limited number of production environments, and our assumptions with regard to this technology have proved incorrect in certain instances in the past. Some

~~The~~15 INMETCO process enables the business to treat and reclaim Ni-Cr-Fe bearing hazardous and non-hazardous materials in a low cost, environmentally safe manner. The INMETCO process is recognized by the EPA as the “Best Demonstrated Available Technology” for the treatment of steelmaking dust (i.e., low zinc KO61, KO62 and F006 designated hazardous waste).

CompetitionTable of Contents

We aspects ~~believe~~of ~~that~~this ~~our~~technology ~~recycling~~have ~~facilities~~not ~~provide~~been antested ~~environmentally~~in ~~favorable~~exactly ~~alternative~~the ~~for~~same ~~disposing~~manner ofor ~~hazardous~~on ~~waste. Since 1978, INMETCO has provided~~ a ~~recycling~~similar ~~alternative~~scale ~~for~~as acompared ~~wide~~to ~~variety of hazardous waste products produced by~~ the ~~specialty~~Mooresboro ~~steel~~facility. ~~industry,~~In ~~including steelmaking dust~~addition, ~~mill~~the ~~scale~~equipment ~~and~~in ~~grinding~~the ~~swarf. Stainless~~Mooresboro ~~steel~~facility ~~producers~~may not ~~are~~be ~~faced~~operated ~~with~~in exactly the same ~~dust~~manner ~~disposal problems~~ as ~~carbon~~in ~~steel~~other ~~producers~~production environments. ~~However,~~ ~~the~~We ~~process~~may ~~requirements~~also ~~and~~not ~~economics~~be ofable ~~stainless~~to ~~steelmaking~~realize ~~dust~~the ~~processing~~reduced ~~are~~recycling ~~different,~~costs ~~since~~or the ~~cost~~logistical ofbenefits ~~treating~~originally ~~the~~anticipated ~~dust~~from ~~may~~the beMooresboro ~~substantially~~facility ~~offset~~operations byand ~~the~~may ~~recovery~~also ofbe unable ~~valuable~~to ~~metals~~penetrate ~~such~~the asmarkets ~~nickel,~~for ~~chromium~~certain ~~and~~grades ~~iron,~~of ~~which~~zinc ~~are~~metal ~~recycled~~that ~~and returned to~~ the ~~specialty~~Mooresboro ~~steel~~facility ~~industry~~was ~~under~~designed ~~toll~~to ~~arrangements~~produce.

InThe ~~the metal processing~~ metals industry, ~~the~~is ~~most~~highly ~~commonly~~cyclical. ~~used~~Fluctuations ~~techniques~~in ~~for~~the ~~managing~~availability ~~and disposing~~ of ~~hazardous~~zinc ~~waste~~and ~~are~~nickel ~~land disposal facilities~~ and ~~recycling~~in ~~facilities~~levels ~~such~~of ascustomer ~~INMETCO’s. We~~demand ~~believe~~have ~~the~~historically ~~INMETCO~~been ~~process~~severe, ~~offers three key advantages over landfill: (1) it is a preferred solution from an environmental~~ and ~~product~~future ~~stewardship~~changes ~~perspective, (2) it offers potential cost advantages through the return of valuable metals~~ and/or ~~(3)~~fluctuations itcould ~~avoids~~cause ~~exposure~~us to ~~long-term~~experience ~~contingent~~lower ~~liabilities~~sales ~~associated with sending waste to landfill facilities. Accordingly~~volumes, wewhich ~~expect~~would negatively ~~the~~impact ~~INMETCO~~our ~~process~~profit ~~to continue to remain the alternative of choice for the specialty steel industry~~margins. We ~~believe INMETCO is the largest recycler of nickel-bearing hazardous waste in North America.~~

WeThe ~~believe~~metals ~~INMETCO~~industry ~~provides~~is ~~new~~highly ~~potential~~cyclical. ~~platforms~~The ~~for~~length ~~growth~~and magnitude of industry cycles have varied over time and by product but generally reflect changes in macroeconomic conditions, ~~including~~levels ~~increasing~~of industry capacity and availability of ~~the~~usable ~~existing~~raw ~~facility~~materials. The overall levels of demand for our products containing zinc or nickel reflect fluctuations in levels of end-user demand, ~~growing~~which depend in large part on general macroeconomic conditions in North America and regional economic conditions in our ~~share~~markets. For example, many of the ~~battery~~principal ~~recycling~~end ~~market~~consumers of zinc metal and zinc-related products operate in industries such as transportation, ~~recycling~~construction ~~other~~or ~~industrial~~general ~~wastes~~manufacturing, towhich ~~recover~~themselves ~~metals~~are heavily dependent on general economic conditions, including the availability of affordable energy sources, employment levels, interest rates, consumer confidence and housing demand. These cyclical shifts in ~~addition~~our customers’ industries tend to ~~nickel~~result in significant fluctuations in demand and ~~enabling~~pricing usfor our products and services. As a result, in periods of recession or low economic growth, metals companies, including ours, have generally tended to ~~expand~~under-perform ~~internationally~~compared to other industries. We generally have ~~increased~~high ~~power~~fixed tocosts, so changes in industry demand that impact our ~~submerged~~production ~~arc~~volume ~~furnace~~also tocan significantly ~~increase~~impact ~~melting~~our ~~output~~profit margins and ~~keep~~our ~~pace~~overall ~~with~~financial ~~stronger~~condition. ~~tolling~~Economic ~~receipts.~~downturns Wein ~~believe~~the ~~there~~national ~~are~~and ~~further~~international ~~opportunities~~economies toand ~~increase~~prolonged ~~capacity~~recessions atin ~~INMETCO~~our toprincipal ~~service~~industry ~~additional~~segments ~~growth~~have inhad ~~nickel-bearing~~a ~~industrial~~negative ~~wastes~~impact ~~generated~~on byour ~~U.S.~~operations ~~stainless~~and a ~~steel~~continuation ~~producers.~~or Wefurther ~~are~~deterioration ~~also~~of ~~currently~~current ~~evaluating~~economic ~~opportunities~~conditions ~~outside~~could ~~the~~have ~~United~~a ~~States~~negative ~~for~~impact ~~the~~on ~~use~~our offuture ~~INMETCO’s~~financial ~~technology~~condition or results of operations.

16Some of our products and services are vulnerable to long-term declines in demand due to competing technologies, materials or imports, which would significantly reduce our sales.

~~Table~~Our zinc and nickel-based products compete with other materials in many of ~~Contents~~their applications. For example, PW zinc is used by steel fabricators in the hot dip galvanizing process, in which steel is coated with zinc in order to protect it from corrosion. Steel fabricators can also use paint, which we do not sell, for corrosion protection. Demand for our zinc as a galvanizing material may shift depending on how customers view the respective merits of hot dip galvanizing and paint. In addition, SHG zinc and CGG zinc are used by continuous galvanizers to produce galvanized flat-rolled sheet steel for the automotive market. Some automotive companies have begun to use lighter weight aluminum sheet to meet fuel efficiency standards by reducing vehicle weight, and to meet recycling standards. Any such shifts in industry uses could affect our sales.

~~Governmental~~Our ~~Regulation~~nickel-bearing products are used in the stainless steel industry, and demand ~~Environmental~~for ~~Issues~~our products and services may decline if demand for stainless steel lessens. Nickel-bearing stainless steel faces competition from stainless steels containing a lower level of nickel or no nickel. Domestic production of stainless steel may be negatively impacted by imports.

~~Our~~In ~~facilities and operations are subject to various federal~~addition, ~~state~~in ~~and~~periods ~~local~~of ~~governmental~~high ~~laws~~zinc and ~~regulations~~nickel ~~with~~prices, ~~respect~~consumers ~~to the protection~~ of ~~the~~these ~~environment,~~metals may ~~including~~have ~~regulations~~additional ~~relating~~incentives to ~~air~~invest ~~and~~in ~~water~~the ~~quality~~development ~~and~~of ~~solid~~technologically ~~and~~viable ~~hazardous~~substitutes ~~waste~~for ~~management~~zinc and ~~disposal~~nickel-based products. ~~These laws include the Comprehensive Environmental Response~~Similarly, ~~Compensation~~customers ~~and~~may ~~Liability~~develop ~~Act~~ways ~~(“CERCLA”~~to ormanufacture ~~“Superfund”),~~their ~~the~~products ~~Superfund~~by ~~Amendment~~using ~~Reauthorization~~less ~~Act,~~zinc ~~the Resource Conservation~~ and ~~Recovery~~nickel-based ~~Act~~material than ~~(“RCRA”),~~they ~~the~~do ~~Clean Air Act, the Clean Water Act, and their state equivalents~~currently. WeIf ~~are~~one ~~also~~or ~~subject~~more ~~to various other laws and regulations, including those administered by the Department~~ of ~~Labor,~~our ~~the~~customers ~~Surface~~successfully ~~Transportation~~identify ~~Board,~~alternative ~~the~~products ~~Occupational~~that ~~Health~~can ~~and~~be ~~Safety~~substituted ~~Administration,~~for ~~the~~our ~~Department~~zinc ofor ~~Transportation~~nickel-based ~~and the Federal Railroad Administration~~products, asor ~~well~~find asways ~~certain~~to ofreduce their ~~state~~zinc ~~equivalents.~~or Wenickel ~~believe that we are in material compliance with applicable laws and regulations~~consumption, ~~including environmental laws and regulations governing~~ our ~~ongoing~~sales ~~operations,~~to ~~and~~those ~~that we have obtained or applied in a timely manner for all material permits~~ and ~~approvals~~other customers ~~necessary~~would ~~for~~likely ~~the operation of our business~~decline.

~~Our process~~Demand ~~modifications~~for ~~have~~our ~~resulted~~EAF indust ~~operations~~or ~~fully~~nickel-bearing ~~utilizing~~waste ~~recycled~~recycling ~~feedstocks.~~operations ~~The~~may ~~use~~decline ofto ~~recycled~~the extent ~~zinc~~that ~~feedstocks~~steel ~~preserves~~mini-mill ~~natural~~producers ~~resources,~~identify ~~precluding~~less ~~the~~expensive ~~need~~or ~~for~~more ~~mining~~convenient ~~and~~alternatives ~~land~~for ~~reclamation~~the ~~and~~disposal ~~thereby~~of ~~operating~~their inEAF adust ~~manner~~or ~~consistent~~nickel-bearing ~~with~~waste or if the ~~principles~~EPA ofwere ~~sustainable~~to ~~development.~~no ~~Our~~longer ~~recycling~~classify ~~services~~EAF ~~avoid~~dust ~~the~~as ~~potential~~a ~~environmental~~listed ~~impacts~~hazardous ~~that~~waste. ~~are~~In ~~associated~~the ~~with~~future, ~~land~~we may ~~filling~~face ~~hazardous~~increased ~~wastes.~~competition from other EAF dust ~~itself~~or isnickel-bearing awaste ~~listed~~recyclers, ~~hazardous~~including ~~waste~~new ~~created~~entrants into those recycling markets, or from landfills implementing more effective disposal techniques. Furthermore, our current recycling customers may seek to capitalize on the ~~melting~~value of ~~steel~~the ~~scrap~~EAF indust ~~electric~~or ~~arc~~nickel-bearing ~~furnaces~~waste produced by ~~the~~their ~~steel~~operations, ~~mini-mill~~or ~~industry.~~may ~~Our~~seek ~~recycling~~to ~~process~~recycle ~~has~~their ~~been~~material ~~designated~~themselves, byor reduce the ~~EPA~~price asthey ~~“Best~~pay ~~Demonstrated~~to ~~Available~~us ~~Technology”~~ for the ~~recycling~~material ofthey ~~EAF~~deliver ~~dust~~to us.

WeIn ~~maintain~~our ~~surety~~zinc ~~bonds~~oxide tobusiness, ~~address~~we ~~financial~~now ~~assurance~~face ~~requirements~~competition ~~for~~from ~~potential~~new ~~future~~capacity ~~remediation~~added ~~costs~~to ~~and~~the ~~RCRA~~market ~~permit~~by ~~termination~~U.S. ~~for~~Zinc ~~several~~and ~~facilities. Financial~~by ~~assurance~~Zinc isOxide ~~required~~LLC, a ~~under~~new ~~RCRA~~zinc ~~permit~~oxide ~~requirements~~manufacturer ~~for~~located ~~the~~in ~~Ellwood City~~Tennessee, ~~Pennsylvania~~which ~~and~~started ~~Palmerton,~~production ~~Pennsylvania~~in ~~facilities~~2014. ~~Financial~~ ~~assurance,~~This ~~through~~additional acapacity ~~surety~~in ~~bond,~~the ismarket ~~also~~may ~~required~~result ~~for~~in ~~eventual~~downward ~~closure~~pressure on prices as these producers attempt to capture new business. Any of ~~our~~these ~~residual~~developments would ~~landfill~~have atan ~~the~~adverse ~~Monaca,~~effect ~~Pennsylvania~~on ~~facility~~our financial results.

In16 Bartlesville, Oklahoma, we and our predecessor formerly operated a primary zinc processing facility which was closed in the 1990’s and subsequently dismantled. Environmental remediation work at this facility was completed in 2003 in connection with closing these former facilities under a consent agreement with the Oklahoma Department of Environmental Quality. We currently manage this facility including groundwater monitoring and other maintenance activities under a RCRA post-closure permit. We, along with two other responsible parties, provide financial assurance for future post closure care activities at the Bartlesville facility. At December 31, 2014, a reserve on our balance sheet in the amount of $0.7 million has been established for our share of future costs associated with this matter.

OurTable Palmerton, Pennsylvania property is part of a CERCLA, or “Superfund,” site that was added to the National Priorities List in 1983. When the Palmerton, Pennsylvania facility’s assets were purchased out of bankruptcy in December 2003, we acquired only those assets, including real property, needed to support the ongoing recycling and metal powders businesses at that location. We currently hold 107 acres within an area of the approximately 1,600 acres owned by HII. With limited exceptions, the successor in interest to previous owners has contractually assumed responsibility for historic site contamination and associated remediation and has indemnified us against any liabilities related to the property, including Natural Resource Damages. Exceptions to this indemnity include our obligations under the 1995 consent decree described below and non-Superfund RCRA obligations and environmental liabilities resulting from our ongoing operations.Contents

~~Our~~We ~~Barnwell,~~may ~~South~~be ~~Carolina~~unable ~~facility~~to ~~and~~compete ~~our~~effectively ~~Rockwood,~~against ~~Tennessee~~manufacturers ~~facility have been the subject~~ of ~~EPA~~zinc and ~~state~~nickel ~~agency~~products in ~~investigations~~one ~~alleging~~or ~~violations~~more ~~under RCRA. In connection with these investigations, we are currently working on a settlement with the U.S. Department~~ of ~~Justice,~~our ~~EPA Region 4~~markets, ~~and~~which ~~the~~would ~~state~~limit ~~agencies.~~our ~~Although~~market ~~the~~share ~~various~~or ~~agencies~~reduce ~~have acknowledged~~ our ~~efforts~~sales ~~to cooperate with these investigations~~ and ~~the~~our ~~improvements~~operating ~~and~~profit ~~investments made at the facilities to address identified issues, if a settlement is not reached, the government may seek penalties and/or issue permanent injunctions against us~~margins. We cannot guarantee that we will be able to reach a satisfactory settlement on these matters, nor can we anticipate the amount of penalties, if any, that may be involved, or other actions that we may be required to complete.

We ~~may~~face ~~also~~intense ~~incur~~competition ~~costs~~from ~~related~~regional, tonational ~~future~~and ~~compliance~~global ~~with~~companies orin ~~violations~~each of ~~applicable~~the ~~environmental~~markets ~~laws~~we ~~and regulations~~serve, ~~including,~~and ~~but~~also ~~not~~face ~~limited~~the potential ~~to,~~for ~~air emission regulations under possible~~ future ~~“Maximum~~entrants ~~Achievable~~and ~~Control~~competitors. ~~Technology”~~We ~~(“MACT”)~~compete ~~rules~~on ~~relating to~~ the ~~Company's~~basis ~~operations~~of ~~such~~product asquality, ~~regulations~~on-time ~~relating~~delivery toperformance ~~non-ferrous~~and ~~secondary~~price, ~~metals~~with ~~production. Our~~price ~~total~~representing ~~cost~~a ofmore ~~environmental~~important ~~compliance~~factor atfor ~~any~~our ~~time~~larger ~~depends~~customers onand afor ~~variety~~sales of ~~regulatory,~~standard ~~legal,~~zinc ~~technical~~products ~~and~~than for ~~factual~~smaller ~~issues,~~customers ~~some~~and ofcustomers ~~which~~to ~~cannot~~whom bewe ~~anticipated.~~sell ~~For~~value-added ~~example,~~zinc-based inproducts. ~~June~~Our ~~2014,~~competitors weinclude ~~received~~other aindependent ~~notice~~zinc ~~and~~producers ~~findings~~as ofwell ~~violation~~as ~~from~~metal ~~Illinois~~traders, ~~EPA~~vertically ~~and~~integrated ~~EPA~~zinc ~~Region~~companies 5that ~~alleging~~mine ~~violations~~and ofproduce ~~certain~~zinc. ~~provisions~~Some of our competitors ~~Calumet,~~have ~~Illinois~~substantially ~~facility’s~~greater ~~Title~~resources, Vincluding ~~Operating~~financial ~~Permit~~resources, ~~and~~than ~~state~~we ~~and federal air regulations~~do. ~~Although~~Our wecompetitors domay ~~not~~also ~~believe~~foresee ~~that~~the ~~these~~course ~~allegations~~of ~~represent~~market adevelopment ~~material~~more ~~risk~~accurately ~~for~~than ~~us,~~ we ~~believe~~do, ~~that~~sell ~~the~~products ~~entry~~at ~~into~~ a ~~consent~~lower ~~order~~price isthan ~~likely~~we tocan ~~occur~~and/or inadapt ~~this~~more quickly ~~case.~~to Wenew ~~cannot~~technologies ~~speculate~~or asindustry toand ~~the~~customer ~~content~~requirements. ofWe ~~the~~operate ~~consent order or~~ in ~~any~~a ~~other~~global ~~way~~marketplace, ~~guarantee~~and ~~the~~zinc ~~outcome~~metal ofimports ~~these~~have ~~investigations~~historically ~~and~~represented the ~~impact~~majority ~~they~~of ~~could~~U.S. ~~have~~zinc onmetal ~~our environmental compliance costs~~consumption. ~~Additional~~

17In the future, foreign zinc metal producers may develop new ways of packaging and transporting zinc metal that could mitigate the freight cost and other shipping limitations that we believe currently limit their ability to more fully penetrate the U.S. zinc market. If our customers in any of the end-user markets we serve were to shift their production outside the United States and Canada, then those customers would likely source zinc overseas, and, as a result, our net sales and results of operations would be adversely affected. If we cannot compete other than by reducing prices, we may lose market share and suffer reduced profit margins. If our competitors lower their prices, it could inhibit our ability to compete for customers with higher value-added sales and could lead to a reduction in our sales volumes and profit. If our product mix changed as a result of competitive pricing, it could have an adverse impact on our gross margins and profitability.

~~Table~~If we were to lose order volumes from any of ~~Contents~~our major customers, our sales could decline significantly and our cash flows may be reduced.

~~environmental~~In 2015, ~~issues~~our ~~could~~ten ~~arise~~largest customers were responsible for 43% of our consolidated sales. In 2015, four of INMETCO’s customers provided 78% of its sales. A loss of order volumes from, or ~~laws~~a ~~and~~loss ~~regulations~~of industry share by, any major customer could negatively beaffect ~~passed~~our financial condition and ~~promulgated,~~results ~~resulting~~of inoperations ~~additional~~by lowering sales volumes, increasing costs and lowering profitability. In addition, ~~which~~some of our ~~reserves~~customers ~~may~~could ~~not~~become ~~cover~~involved in bankruptcy or insolvency proceedings and could default on their obligations to us. We may be required to record significant additional reserves for accounts receivable from customers which ~~could~~may ~~materially~~have ~~harm~~a material impact on our ~~operating~~financial condition, results of operations and cash flows.

~~Employees~~In addition, during the ramp-up of the Mooresboro facility, we only had a limited number of long-term contractual arrangements with our zinc metal customers. Zinc metal customers purchased products and services from us primarily on a spot basis. Customers purchasing such products may choose not to continue to purchase our products and services. The loss of these customers or a significant reduction in their purchase orders could have a negative impact on our sales volume and business.

AsWe ofdepend ~~December~~on ~~31,~~our supplier ~~2014~~relationships, weand ~~employed~~adverse ~~747~~changes ~~persons~~in atthese ~~the~~relationships ~~following~~or ~~locations~~our ability to enter into new relationships could negatively affect our revenue.

Location	SalariedPersonnel	HourlyPersonnel	UnionContractExpiration
Monaca, Pennsylvania	1	3	N/A
Pittsburgh, Pennsylvania	47	—	N/A
Bartlesville, Oklahoma	1	—	N/A
Calumet, Illinois	14	49	08/04/17
Palmerton, Pennsylvania	20	87	04/27/15
Palmerton (Chestnut Ridge Railroad), Pennsylvania	—	3	12/15/16
Rockwood, Tennessee	14	51	07/01/15
Barnwell, South Carolina	11	52	N/A
Ellwood City, Pennsylvania	27	66	10/31/16
Mooresboro, North Carolina	54	203	N/A
Brampton, Ontario Canada	19	25	6/30/16
Total	208	539

We rely significantly on our suppliers. Adverse changes in any of our relationships with suppliers or the inability to enter into new relationships with suppliers could negatively impact our operations and performance. Our current arrangements with suppliers may not remain in effect on current or similar terms and the impact of changes to those arrangements may adversely impact our revenue.

~~The~~We ~~majority~~depend ofon ~~our~~third ~~hourly~~parties ~~personnel~~for ~~are~~transportation ~~unionized. Hourly workers receive medical~~services, ~~dental~~ and ~~prescription~~their ~~drug~~failure ~~benefits.~~to Wedeliver doraw ~~not~~material ~~have~~to ~~defined~~us ~~benefit plans for hourly~~ or finished ~~salaried~~products ~~employees,~~to ~~except at~~ our ~~Brampton,~~customers ~~Ontario~~could ~~Canada~~increase ~~site, which was acquired on November 1, 2011. These defined benefit plans include 31 active employees and are currently frozen to additional participants. We have a 401(k) plan for both~~ our ~~hourly~~costs and ~~salaried~~harm ~~employees at all sites in the United States. Employees at~~ our ~~Brampton,~~reputation Ontario Canada facility hired after June 30, 2012 are eligible to participate in a retirement plan similar to a 401(k). We have no company-paid medical plan for retirees. Our labor contracts provide for a company contribution and inoperating ~~most cases a company match, which varies from contract to contract~~results. ~~We believe we have satisfactory relations with our employees.~~

~~Executive~~We rely ~~Officers~~primarily on third parties for transportation of the products we manufacture, as well as the delivery of EAF dust to our recycling plants and ~~Key~~other ~~Employees~~raw materials to our production facilities. In particular, a substantial portion of the ~~Registrant~~raw materials we use is transported by railroad, which is highly regulated. If any of our third-party transportation providers were to fail to deliver our products in a timely manner, we may be unable to sell those products at full value or at all. Similarly, if any of these providers were to fail to deliver raw materials to us in a timely manner, we may be unable to meet customer demand. In addition, if any of these third parties were to cease operations or cease doing business with us, we may be unable to replace them at reasonable cost. Any failure of a third-party transportation provider to deliver raw materials or finished products in a timely manner could disrupt our operations, harm our reputation and have a material adverse effect on our financial condition and operating results.

~~Set~~17 ~~forth below is information concerning our executive officers and key employees.~~

Name	Age	Position
James M. Hensler	59	Chairman of the Board of Directors, Class I Director, President and Chief Executive Officer
Robert D. Scherich	54	Vice President and Chief Financial Officer
Gary R. Whitaker	59	Vice President, General Counsel and Secretary
Lee Burkett	58	Vice President - Manufacturing
James A. Totera	58	Vice President - Sales and Marketing
Timothy R. Basilone	55	Vice President - Environmental Affairs
Ali Alavi	53	Senior Vice President - Corporate and Environmental Affairs
Bruce Morgan	43	Vice President - Human Resources
Mark Tomaszewski	58	President - INMETCO
Joshua Belczyk	37	General Manager - Zochem
Dr. Anthony Staley	40	General Manager - Horsehead Metal Products, Inc.

~~James~~Equipment M.or ~~Hensler,~~power ~~Chairman of the Board of Directors~~failures, ~~President~~delays ~~and Chief Executive Officer, joined us~~ in ~~April~~deliveries ~~2004.~~or Hecatastrophic ~~has~~loss ~~over~~at ~~30 years~~any of ~~experience~~our facilities ~~working~~could inprevent ~~the~~us ~~metals~~from ~~industry.~~meeting ~~From~~customer ~~2003 to April 2004~~demand, ~~Mr. Hensler~~reduce ~~was~~our ~~a consultant to various companies in the metals industry. From 1999 to 2003~~sales, ~~Mr. Hensler~~increase ~~was~~our ~~Vice~~costs ~~President of Global Operations~~ and/or ~~Vice~~negatively ~~President~~impact ~~and~~our ~~General~~results ~~Manager~~ of ~~the Huntington Alloys Business Unit for Special Metals Corp~~operations., a leading international manufacturer of high performance nickel and cobalt alloys. Prior to that, Mr. Hensler was the Executive Vice President for Austeel Lemont Co., General Manager of Washington Steel Co. and Director of Business Planning for Allegheny Teledyne Inc. He received a BS in

18An interruption in production or service capabilities at any of our production facilities as a result of equipment or power failure, or other reasons, could limit our ability to deliver products to our customers, which would reduce net sales and net income, increase costs, and potentially damage relationships with customers. Any significant delay in deliveries to our customers could lead to increased returns or cancellations, damage to our reputation and/or permanent loss of customers. Any such production stoppage or delay could also require us to make unplanned capital expenditures, which together with reduced sales and increased costs, could adversely affect our results or operations.

~~Table~~Furthermore, because many of ~~Contents~~our customers are, to varying degrees, dependent on deliveries from our facilities, customers that have to reschedule their own production due to our missed deliveries could pursue financial claims against us. Our facilities are also subject to the risk of catastrophic loss due to unanticipated events such as fires, adverse weather conditions or other refinery incidents. We have experienced, and may experience in the future, periods of reduced production as a result of repairs that are necessary to our operations. If any of these events occur in the future, they could have a material adverse effect on our business, financial condition or results of operations. Our insurance policies may not cover all of our losses and we could incur uninsured losses and liabilities arising from, among other things, loss of life, physical damage, business interruptions and product liability.

~~Chemical~~Fluctuations ~~Engineering~~in ~~from~~ the ~~University~~cost ofor ~~Notre~~availability ~~Dame~~of inelectricity, ~~1977~~coke, anand/or ~~MSE~~natural ingas ~~Chemical~~would ~~Engineering~~lead ~~from~~to ~~Princeton~~higher ~~University~~manufacturing incosts, ~~1978~~thereby reducing ~~and~~our anprofit ~~MBA~~margins ~~from~~and ~~the~~limiting ~~Katz~~our ~~Graduate~~cash ~~School~~flows offrom ~~Business at the University of Pittsburgh in 1987~~operations.

~~Robert~~Energy Dis one of our most significant costs, comprising approximately $44 million of our production costs during 2015. ~~Scherich~~Our processes rely on electricity, ~~Vice~~coke ~~President~~and natural gas in order to operate, and ~~Chief~~our ~~Financial~~freight ~~Officer~~operations depend heavily on the availability of diesel fuel. Energy prices, ~~joined~~particularly usfor electricity, natural gas, coke and diesel fuel, have been volatile and have exceeded historical averages in ~~July~~recent ~~2004~~years. ~~From~~These ~~1996~~fluctuations impact our manufacturing costs and contribute to ~~2004~~earnings volatility. We estimate that a hypothetical 10% increase in electricity, Mrnatural gas and coke costs would have reduced our income from operations by approximately $4. ~~Scherich~~4 ~~was~~million ~~the~~for ~~Chief~~2015. ~~Financial~~In ~~Officer~~addition, at most of ~~Valley~~our ~~National~~facilities ~~Gases,~~we ~~Inc.~~do ~~Prior~~not tomaintain ~~that~~sources of secondary power, and hetherefore ~~was~~any prolonged interruptions in the ~~Controller~~supply ~~and~~of ~~General~~energy ~~Manager~~to atour ~~Wheeling-Pittsburgh~~facilities ~~Steel~~could ~~Corp.~~result in lengthy production shutdowns, increased costs associated with restarting production and anwaste ~~accountant~~of atproduction ~~Ernst &~~in ~~Whinney~~progress. ~~Mr. Scherich~~We ~~received~~have aexperienced BSrolling power outages in ~~Business~~the ~~Administration~~past, ~~from~~and ~~The~~any ~~Pennsylvania~~future ~~State~~outages ~~University~~would inreduce ~~1982~~our production capacity, reducing our net sales and potentially impacting our ability to deliver products to our customers.

~~Gary~~Our R.operational ~~Whitaker,~~costs ~~Vice~~are ~~President,~~relatively ~~General~~inflexible ~~Counsel~~ and ~~Secretary,~~do ~~joined~~not usnecessarily indecrease ~~December 2011. Mr. Whitaker previously was~~ in ~~private~~tandem ~~practice~~with ~~in Atlanta, Georgia from 2009 to 2011. He served as Vice President, General Counsel and Secretary for GrafTech International Ltd.,~~ a ~~manufacturer~~reduction ~~of graphite products, including graphite electrodes used~~ in ~~electric~~our ~~arc furnaces, from 2006 to 2008, and as Vice President, General Counsel and Secretary for the US operations of the SK Group, one of South Korea’s largest conglomerates, from 1998 to 2006~~revenue. Mr. Whitaker also worked as a corporate attorney for Eastman Chemical Company and for the DuPont Company, and was a senior associate for Powell, Goldstein, Frazer and Murphy, in Atlanta, Georgia. Mr. Whitaker received a B.A. in History from U.C.L.A. in 1976 and a J.D. from the University of Houston Law School in 1980.

~~Lee~~Many ~~Burkett~~of the expenses associated with owning, ~~Vice~~repairing, ~~President~~upgrading, and operating the Mooresboro facility and our other operations, such as debt-~~Manufacturing~~service ofpayments, ~~Horsehead~~property ~~Corporation~~taxes, ~~joined~~insurance, usand inutilities, ~~November~~are ~~2006~~relatively ~~with~~inflexible ~~over~~and 27do ~~years~~not ofnecessarily ~~industry~~decrease ~~experience~~in tandem with a reduction in our revenue. ~~During~~ ~~the~~Our ~~three~~expenses ~~years~~are ~~prior~~also toaffected ~~joining~~by ~~us,~~inflationary ~~Mr.~~increases ~~Burkett~~and certain ~~served~~costs asmay ~~General~~exceed ~~Manager~~the rate of ~~the~~inflation ~~Bridgeville~~in ~~Facility~~any given period. In the event of ~~Universal~~a ~~Stainless.~~significant ~~Previous~~decrease ~~positions~~in ~~included~~demand ~~General~~for ~~Manager-Finishing~~zinc ~~Operations~~and ofEAF ~~J&L~~dust ~~Specialty~~processing ~~Steel~~services, ~~Plant~~we ~~Manager~~may ofbe ~~Timet’s~~unable ~~Toronto,~~to ~~Ohio~~reduce ~~facility,~~the ~~Vice~~size ~~President~~of ~~Operations~~our ~~for~~workforce ~~Caparo~~to ~~Steel~~decrease wages and 14benefits ~~years~~or ~~with~~to offset ~~Washington~~any ~~Steel~~such increased expenses with ~~responsibilities~~higher electricity, or decreases in ~~all~~revenues ~~aspects~~due to decreased zinc prices. As a result, any of our efforts to reduce operating costs or failure to make scheduled capital expenditures also could adversely affect the ~~operation~~future ~~including~~growth ~~Plant~~of ~~Manager~~our business and the value of ~~Finishing. Mr.~~our ~~Burkett~~assets ~~received~~and ait BSis inpossible ~~Mechanical~~that ~~Engineering~~increased ~~from~~operational ~~The~~costs ~~Pennsylvania~~may ~~State~~decrease ~~University~~our innet ~~1979~~revenues.

~~James~~We A.are ~~Totera,~~subject ~~Vice~~to ~~President-Sales~~stringent ~~and~~environmental ~~Marketing~~regulation, -which ~~Horsehead~~may ~~Corporation,~~cause ~~joined~~ us ~~in 1997. Prior~~ to ~~that,~~incur hesignificant ~~was~~costs ~~the Vice President of Sales for Steel Mill Products, where he worked in, among other things, electric arc furnace (“EAF”) dust recycling~~ and ~~also~~liabilities ~~spent~~that ~~over~~could materially ~~15 years~~harm ~~working~~our inoperating ~~sales positions, including as General Manager of Sales, at Insul Company~~results. ~~Mr. Totera received a BA in Economics, Administrative Management Science and Psychology from Carnegie Mellon University in 1979.~~

~~Timothy~~Our R.activities ~~Basilone,~~are ~~Vice~~subject ~~President-Environmental~~to ~~Affairs~~complex -and ~~Horsehead~~stringent ~~Corporation~~environmental, ~~joined~~energy and usother ingovernmental ~~January~~laws ~~2010. Mr.~~and ~~Basilone~~regulations ~~has~~that ~~over~~have 20had ~~years~~and ofwill ~~experience~~continue ~~working~~to inhave ~~all~~an ~~aspects~~impact ofon ~~environmental~~our ~~affairs~~operations inand ainvestment ~~variety~~decisions ofand ~~industries~~which could adversely affect our operations. ~~Prior~~These tolaws ~~joining~~include usCERCLA, hethe ~~spent~~Superfund ~~ten~~Amendment Reauthorization ~~years~~Act, ~~with~~RCRA, ~~Koppers~~the ~~Inc.~~CAA, ~~including~~the ~~seven~~CWA, ~~years~~and astheir astate ~~Senior~~and ~~Manager~~provincial inequivalents, among others. Regulatory compliance for the ~~Corporate~~operation ~~Environmental~~of ~~Affairs~~our ~~Department~~facilities can be a costly and ~~three~~time-consuming ~~years~~process. asThe ~~Operations~~operation ~~Superintendent~~of atour ~~the~~facilities ~~Koppers~~requires numerous ~~coal~~permits, ~~tar~~approvals, ~~distillation~~and ~~facility~~certificates infrom ~~Clairton~~appropriate federal, ~~Pennsylvania. Prior~~state, toand ~~that~~local Mrgovernmental agencies, as well as compliance with environmental and energy laws and regulations. ~~Basilone~~Although ~~spent~~we ~~nine~~believe ~~years~~that atwe ~~Westinghouse~~have ~~Electric~~obtained ~~Corporation~~or asapplied for the requisite ~~Environmental~~approvals ~~Remediation~~and ~~Program~~permits ~~Manager~~for our existing operations and that our business is operated in ~~the~~substantial ~~Corporate~~compliance ~~Legal~~with applicable laws and ~~Environmental~~regulations, ~~Affairs~~we ~~Department. He~~remain ~~began~~subject ~~his~~to ~~professional~~certain ~~career~~pending asenvironmental anenforcement ~~Exploration~~actions /and ~~Production~~are ~~Geologist~~subject ~~with~~to ~~Marathon~~a varied ~~Oil~~and ~~Company~~complex ~~before~~body ~~moving~~of onlaws and regulations that both governmental authorities and third parties may seek to ~~Westinghouse~~enforce in the future. ~~Mr.~~ ~~Basilone~~In ~~earned~~addition, anaccidental MSspills, ~~degree~~releases, inor ~~Earth~~other ~~and~~events ~~Planetary~~may ~~Science~~occur ~~from~~in the ~~University~~course of ~~Pittsburgh~~our inoperations, ~~1984~~and we cannot give any assurance that we will not incur substantial costs and liabilities as a BAresult ~~degree~~of insuch ~~Geology~~spills ~~from~~or ~~the~~releases, ~~College~~instances of ~~Wooster~~noncompliance, inor ~~1981~~other events, including those relating to claims for damage to property, persons, natural resources or the environment.

~~Ali~~18 Alavi, Senior Vice President-Corporate and Environmental Affairs - Horsehead Corporation, joined us in 1996. Mr. Alavi previously served as our Vice President-Corporate Administration, General Counsel and Secretary, Director & Counsel of Environment, Health & Safety and Director of Environmental Performance. Prior to joining us, Mr. Alavi worked as Assistant General Counsel of Clean Sites, Inc., Senior Regulatory Analyst of the American Petroleum Institute and Project Manager/Engineer for the U.S. Army Toxic & Hazardous Materials Agency. Mr. Alavi received a BA in Geography/Environmental Studies from the University of Pittsburgh in 1983, an MS in Petroleum Engineering from the University of Pittsburgh School of Engineering in 1985 and a JD from the University of Maryland Law School in 1993.

BruceTable Morgan, Vice President-Human Resources - Horsehead Corporation joined us in May 2010. Prior to joining us, from November 2006 to May 2010, Mr. Morgan served as Director of Human Resources-North America for the Steel Mill Services division of Harsco Corporation. Prior to that, Mr. Morgan served as Director of Human Resources for both the Steel and Foundry Divisions of Vesuvius USA, a global refractory manufacturer, where he was employed from March 1997 to November 2006. Among other previous employment, Mr. Morgan served as an HR Associate for the construction and start-up of Gallatin Steel Company, where he was employed from June 1994 to August 1995. Mr. Morgan received a BS degree in Industrial and Labor Relations from Cornell University in 1994.Contents

~~Mark~~In ~~Tomaszewski~~addition, ~~President-INMETCO,~~existing ~~joined~~laws usand onregulations ~~December~~may 31be revised or reinterpreted, ~~2009~~or new ~~when~~laws weand ~~acquired~~regulations ~~INMETCO,~~that ~~where~~may hebe ~~has~~more ~~served~~stringent ~~for~~may ~~over~~become 30applicable ~~years~~to inus ~~positions~~and ~~ranging~~may ~~from~~have ~~General~~a ~~Manager-Finance~~negative ~~and~~effect ~~Administration~~on toour ~~his~~business ~~current~~and ~~position~~results of ~~President~~operations. ofIntricate ~~INMETCO~~and changing environmental, ~~which~~energy, ~~position~~and heother ~~has~~regulatory ~~held~~requirements ~~since~~may ~~August~~necessitate substantial ~~2008~~expenditures to attain compliance, including obtaining and maintaining permits. ~~Mr.~~ ~~Tomaszewski~~If ~~received~~operations aare BSunable into ~~Business~~function ~~Administration~~as ~~from~~planned ~~West~~due ~~Virginia~~to ~~Wesleyan~~changing ~~College~~requirements, inloss ~~1978~~of ~~and~~required anpermits MSor inregulatory ~~Business~~status, ~~Administration~~or ~~from~~local ~~Robert~~opposition, ~~Morris~~it ~~University~~may create expensive delays, extended periods of non-operation, or significant loss of value in ~~1992~~such operations.

19Potential federal climate change legislation or greenhouse gas regulation could result in increased operating costs and reduced demand for our products.

~~Table~~Congress has, from time to time, considered legislation that would cap and reduce emissions of ~~Contents~~greenhouse gases (“GHGs”) for most industrial sectors or impose additional permitting obligations on certain industries, and states have begun taking actions to control or reduce emissions of GHGs, primarily through the adoption of a climate change action plan, completion of GHG emission inventories or development of regional GHG cap and trade programs. In addition, the EPA has adopted rules requiring the monitoring and reporting of GHGs from certain sources. Some states such as Pennsylvania are now requiring that certain facilities report GHG emissions as part of an annual inventory submittal.

~~Joshua~~Any ~~Belczyk~~future state laws, federal ~~General~~laws ~~Manager~~or -implemented ~~Zochem,~~regulations ~~Inc.,~~that ~~joined~~may usbe inadopted ~~September~~to ~~2010~~address asGHG ~~Director~~emissions -could ~~Business~~have ~~Development. Prior~~a tomaterial ~~joining~~adverse ~~Horsehead~~effect on our business, hefinancial ~~worked~~condition ~~with~~and ~~FTI~~results ~~Consulting,~~of ~~Inc~~operations. inIn ~~corporate~~addition, ~~finance~~EPA rules regulating GHG emissions have resulted and ~~restructuring. Prior~~will continue to ~~that,~~result ~~Mr.~~in ~~Belczyk~~electric ~~worked~~utilities ~~eight~~increasing ~~years~~their rates to pay for ~~Bailey-PVS~~compliance ~~Oxides~~measures, ~~LLC,~~and anour ~~environmental~~electric ~~service~~power ~~and~~costs ~~recycling provider to~~could ~~the~~significantly ~~steel~~increase ~~industry~~as a result. Further, ~~where~~ hethe ~~last~~potential ~~served~~physical asimpacts aof ~~multi-site~~climate ~~General~~change ~~Manager. Mr.~~on ~~Belczyk~~the Company’s ~~received~~operations aare BShighly ~~degree~~uncertain, and may include changes in ~~Environmental~~rainfall ~~Science~~patterns, ~~and~~shortages ~~Public~~of ~~Policy~~water ~~from~~or ~~Harvard~~other ~~University~~natural inresources, ~~2000~~ changing sea levels, changing storm patterns and achanging ~~MBA~~temperature ~~from~~levels. These may adversely impact the cost, ~~University~~production ofand ~~Michigan~~financial inperformance ~~2009~~of our operations.

~~Dr.~~Work ~~Anthony~~stoppages Staley, General Manager - Horsehead Metal Products, Inc., joined us in early 2012. Dr. Staley has over 15 years of experience in diversified metals processing. Prior to joining us, he was employed at Freeport McMoRan’s Morenci Operations, the largest installed capacity Copper SX/EW facility in the world, as the Manager of Hydrometallurgical Operations and ~~Technology. He~~other ~~played~~labor amatters ~~significant~~could ~~technical~~interrupt ~~role~~our inproduction or ~~the~~increase ~~startup~~our of the Freeport McMoRan’s Tenke-Fungarume Copper SX/EW facility in the Democratic Republic of Congo. His prior experience includes serving as Manager of Hydrometallurgical Operations at Freeport McMoRan’s Bagdad facilitycosts, aseither ~~well as Chief Metallurgist for Newmont Mining Corporation. Dr. Staley earned a PhD in Physio-Chemical Processing~~ of ~~Metals~~which ~~from~~would ~~the~~negatively ~~Colorado~~impact ~~School~~our ofoperating ~~Mines~~results. He also received a MBE and a BS degree in Chemical and Petroleum-Refining Engineering from the same school. In addition, he has multiple peer reviewed publications ranging from Zinc Solvent Extraction and Electrowinning, Copper Electrowinning, Gold Sampling Protocol, to Aluminum Processing.

~~Available~~As ~~Information~~of December 31, 2015, we had 716 employees, 275, or approximately 38%, of whom were covered by six union contracts. Two of our collective bargaining agreements, covering approximately 69 employees, expire in 2016, one expires in 2017, two expire in 2019 and one expires in 2020. We may be unable to resolve any present or future contract negotiations without work stoppages or significant increases in costs, which could have a material adverse effect on our financial condition, cash flows and operating results. We may be unable to maintain satisfactory relationships with our employees and their unions, and we may encounter strikes, further unionization efforts or other types of conflicts with labor unions or our employees, which may interfere with our production or increase our costs, either of which would negatively impact our operating results.

We19 file annual, quarterly and current reports and other information with the SEC. These filings are available to the public at the SEC’s web site at http://www.sec.gov. You may also read and copy any document we file at the SEC’s public reference room located in Washington, DC 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room.

OurTable Internet website address is www.horsehead.net. Our annual reports on Form 10-K, quarterly reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13 or 15(d) of the Exchange Act of 1934 are available free of charge through our website as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC. Additionally, our Code of Ethics may be accessed within the Investor Relations section of our web site. Our website and the information contained on that site, or connected to that site are not incorporated into and are not intended to be incorporated into this report.Contents

~~ITEM~~Our 1Aoperations are subject to numerous federal, state and provincial statutes that regulate the protection of the health and safety of our employees, and changes in health and safety regulation could result in significant costs, which would reduce our profit margins and adversely affect our cash flow from operations. ~~RISK~~ ~~FACTORS~~

InWe ~~addition~~are subject to the ~~other~~requirements ~~information~~of inthe ~~this~~U.S. ~~Annual~~Occupational ~~Report~~Safety onand ~~Form~~Health ~~10-K~~Administration (“OSHA”), and comparable state and provincial statutes that regulate the ~~following~~protection ~~risk~~of ~~factors~~the ~~should~~health beand ~~read~~safety ~~carefully~~of inworkers. ~~connection~~In ~~with~~addition, ~~evaluating~~the ~~our~~OSHA ~~business~~hazard communication standard and the ~~forward-looking~~Canadian Workplace Hazardous Materials Information System standard requires that information ~~contained~~be inmaintained ~~this~~about ~~Annual~~hazardous ~~Report~~materials onused ~~Form 10-K. Any~~or ofproduced ~~the~~in ~~following~~operations ~~risks~~and ~~could~~that ~~materially~~this ~~adversely~~information ~~affect~~be ~~our~~provided ~~business~~to employees, ~~operating results~~state, ~~financial~~provincial ~~condition~~ and ~~the~~local ~~actual~~government ~~outcome~~authorities ofand ~~matters~~customers. asWe are also subject to ~~which~~federal, westate ~~have~~and provincial ~~made~~laws ~~forward-looking~~regarding ~~statements~~operational insafety. ~~this~~Costs ~~Annual~~and ~~Report~~liabilities onrelated ~~Form 10-K. There~~to worker safety may be ~~additional~~incurred ~~risks~~ and ~~uncertainties~~any ~~that~~violation ~~are~~of ~~not~~health ~~presently~~and ~~known~~safety laws or ~~that~~regulations wecould doimpose ~~not~~substantial ~~currently~~costs ~~consider~~on tous. bePossible ~~significant~~future ~~that~~developments, ~~may~~including stricter ~~adversely~~safety ~~affect~~laws ~~our~~for ~~business~~workers or others, ~~performance~~regulations and enforcement policies and claims for personal injury or ~~financial~~property ~~condition~~damages resulting from our operations could result in ~~the~~substantial ~~future~~costs and liabilities that could impose significant costs on us.

~~Risks~~We ~~related~~depend toon the service of key individuals and specialized and skilled operators, the loss of whom could materially harm our business .

WeOur ~~may~~success bewill ~~unable~~depend, toin ~~resolve~~part, on the ~~operational~~efforts ~~issues~~of ~~that~~our ~~have~~executive ~~delayed~~officers ~~ramp-up~~and other key employees, none of ~~production~~whom atare covered by key person insurance policies. These individuals possess sales, marketing, engineering, manufacturing, financial and administrative skills that are critical to the operation of our ~~new~~business. ~~zinc~~If ~~facility~~we lose or ~~experience~~suffer ~~new~~an extended ~~issues~~interruption ~~that~~in ~~may~~the ~~cause~~services ~~further~~of ~~delays,~~one ~~each~~or more of ~~which~~our ~~would~~executive ~~materially~~officers ~~harm~~or other key employees, or are unable to replace our ~~profitability~~chief financial officer, ~~liquidity~~who on July 28, 2016 advised us that he will be departing the Company effective August 31, 2016, our business, results of operations and financial condition ~~and~~may ~~operations~~be negatively impacted.

In ~~April 2014~~ addition, webecause permanently closed our Monaca, Pennsylvania facility and in May 2014, we began production at our new zinc facility. Our new zinc facility has experienced operational difficulties that have resulted in production interruptions and have delayed the ramp-up to full production. We believe our new zinc facility is capable of ~~producing over 155,000 tons of zinc metal per year; however,~~ the ~~facility~~nature ~~produced approximately 12,000 tons~~ of ~~zinc~~our ~~metal in the fourth quarter of 2014~~operations, ~~approximately~~we ~~4,300~~require ~~tons~~highly inspecialized ~~the third quarter of 2014~~ and ~~approximately~~skilled ~~3,400 tons in the second quarter of 2014~~operators. ~~The~~If ~~primary~~we ~~bottleneck~~are ~~thus~~unable ~~far~~to ~~has~~attract ~~been the removal of solids at the front end of the process. We have made progress through better control of the process~~ and byretain ~~equipment~~these ~~modifications and the facility has been operating continuously since early August 2014. During January 2015~~individuals, weour ~~produced~~business ~~approximately~~may ~~4,600 tons of zinc metal~~suffer. We ~~reduced~~The ~~the~~market ~~plating rate~~ for ~~several~~qualified ~~days~~individuals inis ~~January~~highly tocompetitive perform some needed maintenance in the cell house. We also experienced intermittent equipment reliability issues, particularly with some key pumps, which were further exacerbated by recent extreme cold weather conditions. On February 20, 2015, and we ~~began~~may anot ~~planned~~be ~~seven~~able ~~day outage~~ to ~~address~~attract ~~several~~and ofretain ~~these~~qualified ~~issues. We~~personnel ~~expect~~ to ~~ramp-up~~succeed ~~production~~members ~~following~~of ~~this~~our ~~outage. Our~~management ~~interim~~team ~~target~~or isother tokey ~~demonstrate~~employees ~~that no bottlenecks exist to operating the facility at 75% of nameplate capacity,~~ or ~~330 tons per day~~operators, byshould the ~~end~~need ~~of the first quarter of 2015~~arise. We ~~believe that our ability to achieve this higher level of production will depend primarily on the~~

20We may not be able to protect our intellectual property, particularly our proprietary technology related to the recycling of EAF dust and the processing of nickel-bearing materials. Our market share and results of operations could be harmed.

~~Table~~We rely upon proprietary know-how and continuing technological and operating innovation and other trade secrets to develop and maintain our competitive position. Our competitors could gain knowledge of ~~Contents~~our know-how or trade secrets, either directly or through one or more of our employees or other third parties. If one or more of our competitors can use or independently develop such know-how or trade secrets, our market share, sales volumes and profit margins could be adversely affected.

~~absence~~Litigation ofrelated ~~further unplanned equipment issues. We cannot guarantee that our efforts~~ to ~~remediate~~worker ~~known~~safety ~~issues will be sufficient~~ or ~~that~~employment welaws ~~will not encounter additional issues that~~ may result in ~~further~~significant ~~delays.~~liabilities ~~We are also unable to foresee the severity of any such issues. If we are unable to continue to increase production levels~~ and ~~sustain~~limit ~~such levels of production,~~ our profitability~~, liquidity, financial condition and operations would be materially adversely affected~~.

We may be involved in claims and litigation filed on behalf of persons alleging injuries suffered predominantly because of occupational exposure to substances at our facilities, or allegations of violations of laws prohibiting discrimination, or harassment or providing other rights relating to the employment relationship. It is not ~~have~~possible ~~sufficient~~to ~~funds~~predict the ultimate outcome of these claims and lawsuits due to ~~correct~~the ~~operational~~unpredictable ~~issues~~nature ~~experienced~~of bypersonal injury or employment law litigation. If these claims and lawsuits, individually or in the aggregate, were finally resolved against us, our ~~new~~results ~~zinc~~of ~~facility~~operations and cash flows could be adversely affected.

IfCurrent ~~we are not able to correct the operational issues currently experienced by our new zinc facility, if new unforeseen operational issues appear,~~ or iffuture ~~the~~credit ~~costs~~and offinancial ~~correcting~~market ~~such~~conditions ~~issues is greater than expected, we~~ could ~~require~~materially ~~additional~~and ~~financing,~~adversely affect ~~which we may not be able to obtain on acceptable terms in a timely manner or at all. If we cannot obtain additional financing to address any operational issues at~~ our ~~new~~business ~~zinc~~and ~~facility,~~results ~~our~~of ~~liquidity, financial condition and~~ operations ~~would~~in beseveral ~~materially adversely affected~~ways.

~~The~~Financial ~~projected~~markets ~~benefits~~in the United States, Europe and Asia have experienced disruption, including, among other things, volatility in securities prices, diminished liquidity and credit availability, rating downgrades of certain investments and declining valuations of others. There can be no assurance that there will not be further deterioration in these markets and confidence in economic conditions. These economic developments affect businesses such as ours in a number of ways. Tightening credit in financial markets may delay or prevent our customers from ~~the~~securing funding adequate to honor their existing contracts with us or to enter into new ~~zinc~~contracts ~~facility~~to purchase our products and could result in a decrease in or cancellation of orders for our products. Our customers may ~~fail~~also seek to delay ~~materialize~~deliveries of our products under existing contracts, which may postpone our ability to recognize revenue on contracts in our order backlog.

~~The~~20 benefits that we project to receive from the new zinc facility are based on numerous assumptions, and if these assumptions are incorrect, it could negatively impact such projected benefits. The technology that we are using at this new zinc facility has only been implemented in a limited number of production environments, and our assumptions with regard to this technology may be incorrect. Some aspects of the technology in the new zinc facility have not been tested in exactly the same manner on a production scale or the equipment in the new zinc facility may not be operated in exactly the same manner as the other production environments. For example, since we started production in May 2014, although we have been able to produce SHG zinc, we have had periods following operational disruptions during which we have been limited to producing other grades of zinc that sell for less than SHG zinc. If we are not able to remediate these operational issues, our ability to produce SHG zinc could be impaired, reducing the expected revenues from sales and limiting the markets for sales of our zinc metal. We may also not be able to realize the reduced recycling costs or the logistical benefits that come from directly converting WOX to SHG zinc or other grades of zinc. Further, we may be unable to penetrate the market for the SHG zinc or other grades of zinc that we plan to produce.

TheTable projected benefits from the new zinc facility are based on numerous assumptions, all of which are subject to change, including the recovery rate and prices of zinc and the other metals we expect to recover, the prices of other metals we expect to sell, energy consumption requirements, energy prices, the number of employees required to operate the new zinc facility and labor and maintenance costs at the new zinc facility, some of which are dependent upon our ability to ramp-up production. The actual incremental benefits that we expect to achieve from our new zinc facility may be significantly less than expected. If any of our assumptions are incorrect, we may not realize the anticipated benefits from the new zinc facility, which could negatively impact our future business and results of operations.Contents

~~Equipment~~Our orbusiness ~~power~~is ~~failures~~also adversely affected by decreases in the general level of economic activity, ~~delays~~including the levels of purchasing and investment in ~~deliveries~~general. Strengthening of the rate of exchange for the U.S. dollar against certain major currencies may adversely affect our financial results or ~~catastrophic~~our ~~loss~~domestic atcustomers’ ability ~~any~~to export their product. We are unable to predict the likely duration and severity of ~~our~~disruptions ~~facilities~~in ~~could~~financial ~~prevent~~markets usand ~~from~~sluggish ~~meeting~~economic ~~customer~~conditions ~~demand~~in the United States and other countries, ~~reduce~~and ~~our~~any ~~sales~~resulting effects or changes, ~~increase~~including those ~~our~~described ~~costs~~above, may have a material and~~/or~~ ~~negatively~~adverse ~~impact~~effect on our business, results of operations and financial condition.

AnWe have ~~interruption~~determined inthat ~~production or service capabilities at any of~~ our ~~production~~disclosure ~~facilities~~controls asand aprocedures ~~result of equipment or power failure or other reasons could limit our ability to deliver products to our customers, reducing our net sales~~ and ~~net income, increasing~~ our ~~costs~~internal ~~and~~control ~~potentially~~over ~~damaging~~financial ~~relationships~~reporting ~~with~~are ~~our~~not ~~customers~~effective. ~~Any~~The ~~significant~~lack ~~delay in deliveries to our customers could lead to increased returns or cancellations, damage to our reputation and/or permanent loss~~ of ~~customers.~~effective ~~Any~~internal ~~such~~controls ~~production stoppage or delay~~ could ~~also~~materially ~~require us to make unplanned capital expenditures, which together with reduced sales and increased costs, could~~ adversely affect our ~~results~~financial ~~or operations~~condition. ~~For~~ instance, since the start-up of our new zinc facility we have encountered operational difficulties that have prevented ramp-up to full production. These operational difficulties have resulted in production interruptions.

~~Furthermore,~~As ~~because~~disclosed ~~many~~in ofItem ~~our~~9A ~~customers~~“Controls ~~are,~~and toProcedures ~~varying~~- ~~degrees,~~of ~~dependent~~this onForm ~~deliveries~~10-K” ~~from~~ our ~~facilities,~~management ~~customers~~team ~~that~~for ~~have to reschedule their own production due to our missed deliveries could pursue~~ financial ~~claims~~reporting, under ~~against~~the ~~us.~~supervision ~~Our~~and ~~facilities~~with ~~are also subject to~~ the ~~risk~~participation of ~~catastrophic~~our ~~loss~~principal ~~due~~executive toofficer ~~unanticipated~~and ~~events~~principal ~~such~~financial asreporting ~~fires,~~and ~~adverse~~accounting ~~weather conditions or other refinery incidents. We have experienced~~officer, ~~and~~conducted ~~may~~an ~~experience~~evaluation inof the ~~future,~~operating ~~periods~~effectiveness of ~~reduced~~our ~~production~~internal ascontrols. aManagement ~~result~~identified certain ofmaterial ~~repairs~~weaknesses, ~~that~~which are ~~necessary~~described ~~to our operations~~herein. IfAs ~~any~~a result of ~~these events occur in~~ the ~~future~~material weaknesses, ~~they~~our ~~could~~principal ~~have~~executive aofficer ~~material~~and ~~adverse~~principal ~~effect on our business,~~ financial ~~condition~~reporting orand ~~results~~accounting ofofficer ~~operations.~~have ~~Our~~concluded ~~insurance~~that ~~policies~~the ~~may~~Company did not ~~cover~~maintain ~~all~~effective internal ofcontrol ~~our~~over ~~losses~~financial ~~and~~reporting weas ~~could~~of ~~incur~~December ~~uninsured~~31, ~~losses~~2015, ~~and~~based ~~liabilities~~on ~~arising~~the ~~from,~~criteria ~~among~~established ~~other~~in ~~things,~~the ~~loss~~2013 ofInternal ~~life,~~Control ~~physical~~- ~~damage,~~Integrated ~~business~~Framework ~~interruptions~~issued ~~and~~by ~~product liability~~COSO.

~~The~~Management ~~metals~~is ~~industry~~in isthe ~~highly~~process ~~cyclical.~~of ~~Fluctuations~~implementing inremediation efforts for these material weaknesses, however, until we are able to implement revised internal controls and test the ~~availability~~operating effectiveness of ~~zinc~~such remediated internal controls to ensure the effectiveness of our disclosure controls and ~~nickel~~procedures, any material weaknesses may materially adversely affect our ability to report accurately our financial condition and results of operations in ~~levels~~the offuture ~~customer~~in ~~demand~~a ~~have~~timely ~~historically~~and ~~been~~reliable ~~severe~~manner. In addition, ~~and~~although ~~future~~we ~~changes~~continually review and~~/or~~ ~~fluctuations~~evaluate ~~could~~internal ~~cause~~control ussystems to ~~experience~~allow ~~lower~~management ~~sales~~to ~~volumes~~report on the sufficiency of our internal controls, ~~which~~we ~~would~~cannot ~~negatively~~assure ~~impact~~you that we will not discover additional weaknesses in our ~~profit~~internal ~~margins~~control over financial reporting. Any such additional weakness or failure to remediate the existing weakness could materially adversely affect our financial condition or ability to comply with applicable financial reporting requirements and the requirements of the Company’s various financing agreements.

21Risks Related to our Common Stock

~~Table~~We ofintend ~~Contents~~to cancel our common stock upon emergence without any distribution to or recovery for holders thereof.

~~The~~We ~~metals~~have ~~industry~~a issignificant ~~highly~~amount ~~cyclical. The length and magnitude~~ of ~~industry~~indebtedness ~~cycles~~that ~~have~~is ~~varied~~senior ~~over~~to ~~time~~our ~~and~~existing bycommon ~~product~~stock ~~but~~in ~~generally~~our ~~reflect~~capital ~~changes~~structure. inAs ~~macroeconomic conditions~~a result, ~~levels~~the ofPlan ~~industry~~contemplates ~~capacity~~the ~~and~~cancellation ~~availability~~ of ~~usable~~our ~~raw~~common ~~materials.~~stock ~~The~~upon ~~overall~~emergence ~~levels~~from ofthe ~~demand~~Chapter ~~for~~11 ~~our~~Cases ~~products~~without ~~containing~~any ~~zinc~~distribution or ~~nickel~~recovery ~~reflect~~on ~~fluctuations~~account ~~in levels~~ of ~~end-user~~such ~~demand,~~common ~~which depend in large part on general macroeconomic conditions in North America and regional economic conditions in our markets~~stock. ~~For~~In ~~example~~addition, ~~many~~holders of ~~the~~our ~~principal~~common ~~consumers~~stock ofare ~~zinc~~not ~~metal~~entitled ~~and~~to ~~zinc-related~~vote ~~products~~on the ~~operate~~Plan. Trading in ~~industries~~our ~~such~~securities asduring ~~transportation, construction or general manufacturing, that themselves are heavily dependent on general economic conditions, including~~ the ~~availability~~pendency of ~~affordable~~our ~~energy~~Chapter ~~sources,~~11 ~~employment~~Cases ~~levels,~~is ~~interest~~highly ~~rates,~~speculative ~~consumer confidence~~ and ~~housing~~poses ~~demand~~substantial risks. ~~These~~Trading ~~cyclical~~prices ~~shifts~~for in our ~~customers’~~common ~~industries~~stock ~~tend~~are tovery ~~result~~volatile ~~in significant fluctuations in demand~~ and ~~pricing~~may ~~for~~bear ~~our~~little ~~products and services. As a result, in periods of recession~~ or ~~low~~no ~~economic~~relationship ~~growth,~~to ~~metals~~the ~~companies,~~proposals ~~including ours, have generally tended to~~ under~~-perform~~ the ~~compared to other industries~~Plan. ~~We generally have high fixed costs~~Accordingly, sowe ~~changes~~encourage ~~in industry demand~~ that ~~impact~~extreme ~~our~~caution ~~production~~be ~~volume~~exercised ~~also~~with ~~can~~respect ~~significantly~~to ~~impact~~existing ~~our profit margins~~ and ~~our~~future ~~overall~~investments ~~financial condition. Economic downturns~~ in ~~the national and international economies and prolonged recessions in~~ our ~~principal~~common ~~industry~~stock ~~segments have had a negative impact on our operations~~ and onany ~~those~~ of our ~~predecessor~~other ~~both~~securities. ~~recently~~If ~~and~~you inacquire ~~the~~shares ~~past, and a continuation or further deterioration~~ of ~~current economic conditions could have a negative impact on~~ our ~~future~~common ~~financial~~stock, ~~condition~~you ormay ~~results~~lose ofall ~~operations~~your investment.

~~Changes~~Our incommon ~~the~~stock ~~prices~~was ofdelisted ~~zinc~~from NASDAQ and ~~nickel~~ will ~~have~~not abe ~~significant~~listed ~~impact~~ on ~~our~~any ~~operating~~other ~~results~~national ~~and~~securities ~~financial condition~~exchange.

WeTrading ~~derive most~~ of our ~~revenue~~common ~~from~~stock ~~the~~on ~~sale~~NASDAQ ofwas ~~zinc~~suspended on February 11, 2016 and on February 23, 2016, NASDAQ filed a Form ~~portion~~25 ofwith the SEC to remove our ~~revenue~~common stock from ~~nickel-based~~listing ~~products~~on NASDAQ. ~~Changes~~As a result, our common stock now trades in the OTC market. ~~prices~~The trading of ~~zinc~~our ~~and~~common ~~nickel~~stock ~~impact~~in the ~~selling~~OTC ~~prices~~market rather than NASDAQ negatively impacted the trading price of our common ~~products,~~stock and ~~therefore~~the ~~our~~levels ~~profitability~~of isliquidity ~~significantly~~available ~~affected~~to byour ~~decreased~~stockholders. ~~zinc~~In ~~and~~addition, ~~nickel~~securities ~~prices.~~which ~~Market~~trade ~~prices~~in ofthe ~~these~~OTC ~~metals~~market are ~~dependent~~not ~~upon~~eligible ~~supply~~for ~~and~~margin ~~demand~~loans and amake ~~variety~~our ofcommon ~~factors~~stock ~~over~~subject ~~which~~to wethe ~~have~~provisions ~~little~~of orRule no15g-9 ~~control~~of the Exchange Act, commonly ~~including:~~referred to as the “penny stock rule.”

•Our ~~U.S.~~common ~~and~~stock ~~world~~is ~~economic~~subject ~~conditions;~~to the associated risks of trading in an OTC market.

•Securities traded in the ~~balance~~OTC ~~between~~market ~~supply~~generally have significantly less liquidity than securities traded on a national securities exchange, due to factors such as the reduced number of investors that will consider investing in the securities, the reduced number of market makers in the securities, and ~~demand;~~the reduced number of securities analysts that follow such securities. As a result, holders of shares of our common stock may find it difficult to resell their shares at prices quoted in the market or at all. Because of the limited market and generally low volume of trading in our common stock that could occur, the share price of our common stock could be more likely to be affected by broad market fluctuations, general market conditions, fluctuations in our operating results, changes in the market’s perception of our business, and announcements made by us, our competitors, parties with whom we have business relationships or third parties with interests in the Chapter 11 Cases.

•ITEM ~~availability~~1B. ~~and~~UNRESOLVED ~~relative~~STAFF ~~pricing of metal substitutes;~~COMMENTS

•None. ~~labor costs;~~

•ITEM ~~energy~~2. ~~prices;~~PROPERTIES

•As ~~environmental~~of ~~laws~~December 31, 2015, our zinc production operations are located in Mooresboro, North Carolina, Palmerton, Pennsylvania and ~~regulations~~Brampton, Ontario Canada and our principal zinc recycling operations are located in Palmerton, Calumet, Illinois; Rockwood, Tennessee; and Barnwell, South Carolina. Our nickel recycling operations are located in Ellwood City, Pennsylvania.

•Our ~~weather;~~zinc facility located in Mooresboro began production in May 2014. The facility was designed to convert WOX derived from EAF dust and other recycled materials into SHG zinc, CGG zinc and High Grade zinc, in addition to the PW grade that we previously produced at our former Monaca, Pennsylvania facility. This new zinc facility replaced our Monaca, Pennsylvania facility which was permanently closed in April 2014.

•21 ~~import and export restrictions; and~~

•Table the effect of financial commodity speculations.Contents

~~Declines~~On inJanuary 22, ~~the~~2016, ~~price~~we ofannounced ~~zinc~~the ~~have~~idling ~~had~~of ~~a negative impact on~~ our ~~operations in the past~~Mooresboro, ~~and~~North Carolina ~~future~~zinc ~~declines~~production ~~could~~facility. ~~have~~The adecision ~~negative~~to ~~impact~~idle onthe ~~our~~Mooresboro ~~future~~facility ~~financial~~was ~~condition~~the orresult ~~results~~ of ~~operations.~~many ~~In 2002~~factors, ~~record~~including ~~low~~a depressed zinc ~~prices,~~price ~~together with high operational~~ and ~~legacy~~our ~~environmental~~liquidity ~~costs~~situation. ~~and~~To ~~inefficiencies~~date, ~~caused~~the ~~our~~Mooresboro ~~predecessor,~~facility ~~HII,~~remains toin ~~file~~an ~~for~~idled ~~Chapter~~state. 11We ~~bankruptcy~~filed voluntary ~~protection.~~petitions ~~Market~~for ~~conditions~~relief ~~beyond~~under ~~our~~Chapter ~~control~~11 ~~determine~~of the ~~prices~~United ~~for~~States ~~our~~Bankruptcy ~~products,~~Code ~~and~~in the ~~price~~United ~~for~~States ~~any~~Bankruptcy ~~one~~Court orfor ~~more~~the District of ~~our~~Delaware ~~products~~on ~~may~~February 2, ~~fall~~2016. ~~below~~We ~~our~~continue ~~production~~to ~~costs,~~operate ~~requiring~~our usbusinesses toas ~~either incur short~~debtors-~~term~~in-possession ~~losses~~subject to ~~and/or~~the ~~idle~~jurisdiction orof ~~permanently~~the ~~shut~~Bankruptcy ~~down production capacity~~Court. ~~Market~~For ~~prices~~additional ~~for~~information ~~zinc~~regarding ~~and~~the ~~nickel~~Chapter ~~may~~11 ~~decrease~~Cases, ~~and~~see ~~therefore~~“Item ~~our~~1. ~~operating~~Business ~~results~~- ~~may~~Chapter be11 ~~significantly~~Bankruptcy ~~harmed~~Filings.”

~~Some~~The ofchart ~~our~~below ~~products~~provides ~~and~~a ~~services~~brief ~~are~~description ~~vulnerable~~of toeach ~~long-term~~of ~~declines~~our inproduction ~~demand~~facilities. ~~due~~We toown ~~competing~~each ~~technologies,~~of ~~materials~~the orfacilities ~~imports,~~listed ~~which would significantly reduce our sales~~below.

Our zinc and nickel-based products compete with other materials in many of their applications. For example, PW zinc is used by steel fabricators in the hot dip galvanizing process, in which steel is coated with zinc in order to protect it from corrosion. Steel fabricators also can use paint, which we do not sell, for corrosion protection. Demand for our zinc as a galvanizing material may shift depending on how customers view the respective merits of hot dip galvanizing and paint. In addition, SHG zinc and CGG zinc are used by continuous galvanizers to produce galvanized flat-rolled sheet steel for the automotive market. There have been recent plans by automotive companies to use lighter weight aluminum sheet to replace galvanized steel. Any such shifts in industry uses could affect our sales.

Location

Process

Product

Effective Annual

Capacity (tons)

Mooresboro, NC

Finished Product

Zinc Metal

155,000 (1)

Brampton, Ontario Canada

Finished Product

Zinc Oxide

72,000 (2)

Barnwell, SC

Recycling

WOX(3)

180,000*

Calumet, IL

Recycling

WOX

163,000*

Palmerton, PA

Recycling

Calcine

130,000 (4)

WOX

230,000*

Zinc Powder

5,000 to 14,000 (5)

Rockwood, TN

Recycling

WOX

162,000*

Ellwood City, PA

Recycling

Nickel-chromium-
iron alloy

70,000*

Total carbon steel EAF dust Recycling Capacity

735,000

~~Our~~* ~~nickel-based~~Represents ~~products~~EAF ~~are~~dust ~~used in the stainless steel industry. Demand for our products~~ and ~~services~~other ~~may decline if demand for stainless steel lessens. Nickel~~metal-bearing ~~stainless~~wastes ~~steel~~recycling ~~faces~~and ~~competition~~processing ~~from stainless steels containing a lower level of nickel or no nickel. Domestic production of stainless steel may be negatively impacted by imports.~~capacity

In(1) ~~addition,~~We inidled ~~periods~~the ofMooresboro ~~high~~ zinc ~~and~~facility ~~nickel~~on ~~prices~~January 22, ~~consumers~~2016, ofand ~~these~~it ~~metals~~remains ~~may~~idled ~~have~~as ~~additional~~of ~~incentives to invest in~~ the ~~development~~date of ~~technologically~~this ~~viable~~filing. ~~substitutes~~The ~~for~~Mooresboro ~~zinc~~facility ~~and~~is ~~nickel-based~~designed ~~products.~~to ~~Similarly,~~be ~~customers~~capable ~~may~~of ~~develop~~producing ~~ways~~over to155,000 ~~manufacture~~tons ~~their~~of ~~products~~zinc bymetal ~~using~~per ~~less~~year, ~~zinc~~ and ~~nickel-based~~with ~~material~~certain ~~than~~modifications, ~~they~~to dobe ~~currently.~~capable Ifof ~~one~~producing orover ~~more~~170,000 tons of ~~our~~zinc ~~customers~~metal ~~successfully~~per ~~identify~~year. ~~alternative~~However, ~~products~~achieving ~~that~~these ~~can~~design becapacities ~~substituted~~will ~~for~~be ~~our~~subject ~~zinc~~to orthe ~~nickel-based~~successful ~~products,~~repairs orof ~~find~~and ~~ways~~upgrades to ~~reduce~~the ~~their zinc or nickel consumption~~facility, ~~our~~as ~~sales~~described tounder ~~those~~Item ~~and~~1A. ~~other~~“Risk ~~customers~~Factors” ~~would~~included ~~likely~~in ~~decline~~this report.

22(2) During 2014, we completed an expansion project at the Zochem facility and increased the former capacity of 49,600 annual tons to approximately 72,000 annual tons of zinc oxide per year.

~~Table~~(3) ofWOX, ~~Contents~~with approximately 55% - 65% zinc content, is produced by our recycling operations and is sold as feedstock for other producers or further processed in Palmerton into zinc calcine (up to 65% - 70% zinc content). We expect that WOX will be used as a feedstock for the Mooresboro facility when it is restarted.

~~Demand~~(4) ~~for~~Assumes ~~our EAF dust or nickel-bearing waste recycling operations may decline to the extent~~ that ~~steel~~one ~~mini-mill producers identify less expensive or more convenient alternatives for the disposal~~ of ~~their~~four ~~EAF~~kilns ~~dust~~is oroperated ~~nickel-bearing waste or if the EPA were~~ to noproduce ~~longer~~calcine ~~classify~~and ~~EAF dust as a listed hazardous waste. We may in~~ the ~~future face increased competition from~~ other ~~EAF~~three ~~dust~~kilns orare ~~nickel-bearing~~operated ~~waste~~to ~~recyclers,~~produce ~~including new entrants into those recycling markets, or from landfills implementing more effective disposal techniques~~WOX. ~~Furthermore,~~We ~~our~~expect ~~current~~that ~~recycling customers may seek to capitalize on~~ the ~~value~~calcining ofoperation ~~the~~will ~~EAF~~be ~~dust~~shut ordown ~~nickel-bearing~~when ~~waste~~Mooresboro ~~produced~~(which byhas ~~their~~been ~~operations,~~idled orsince ~~may~~January ~~seek to recycle their material themselves~~22, or2016) ~~reduce~~begins ~~the price they pay~~ to usconsistently ~~for~~achieve ~~the~~a ~~material~~production ~~they~~capacity ~~deliver~~utilization tolevel ~~us. Any~~ of ~~these~~approximately ~~developments would have an adverse effect on our financial results~~75%.

We(5) ~~may~~Depending beupon ~~unable to compete effectively against manufacturers of zinc and nickel products in one or more of our markets, which would limit our market share or reduce our sales and our operating profit margins~~grade.

We ~~face~~believe ~~intense~~that ~~competition~~our ~~from~~existing ~~regional,~~space ~~national~~is ~~and~~adequate ~~global companies in each of the markets we serve, where we face also the potential~~ for ~~future~~our ~~entrants~~current ~~and competitors~~operations. We ~~compete~~believe on the basis of product quality, on-time delivery performance and price, with price representing a more important factor for our larger customers and for sales of standard zinc products than for smaller customers and customers to whom we sell value-added zinc-based products. Our competitors include other independent zinc producers as well as vertically integrated zinc companies that ~~mine~~suitable ~~and~~replacement ~~produce zinc. Some of our competitors have substantially greater financial~~ and ~~other~~additional space ~~resources~~will ~~than~~be weavailable ~~do.~~in ~~Our competitors may also foresee~~ the ~~course~~future ofon ~~market~~commercially ~~development~~reasonable ~~more accurately than we do, sell products at a lower price than we can and/or adapt more quickly to new technologies or industry and customer requirements~~terms. ~~We operate in a global marketplace, and zinc metal imports have historically represented approximately 75% of U.S. zinc metal consumption.~~

InITEM the future, foreign zinc metal producers may develop new ways of packaging and transporting zinc metal that could mitigate the freight cost and other shipping limitations that we believe currently limit their ability to more fully penetrate the U3.S. ~~zinc~~LEGAL market. If our customers in any of the end-user markets we serve were to shift their production outside the United States and Canada, then those customers would likely source zinc overseas, and, as a result, our net sales and results of operations would be adversely affected. If we cannot compete other than by reducing prices, we may lose market share and suffer reduced profit margins. If our competitors lower their prices, it could inhibit our ability to compete for customers with higher value-added sales and could lead to a reduction in our sales volumes and profit. If our product mix changed as a result of competitive pricing, it could have an adverse impact on our gross margins and profitability.PROCEEDINGS

~~Servicing~~We ~~our~~are ~~debt~~subject ~~requires~~to afederal, ~~significant~~state ~~amount~~and oflocal ~~cash,~~laws designed to protect the environment and we ~~may~~believe ~~not~~that ~~have~~as ~~sufficient~~a ~~cash~~general ~~flow~~matter, our ~~from~~policies, ~~our~~practices ~~business~~and procedures are properly designed to ~~pay~~reasonably ~~the~~prevent ~~notes~~risk orof ~~other~~environmental ~~debt~~damage weand ~~may~~financial ~~occur~~liability to the Company.

~~Our~~We ~~ability~~are toparty ~~make scheduled payments of the principal or pay interest on or~~ to ~~refinance~~various ~~our 3.80% Convertible Notes (the "Convertible Notes")~~litigation, ~~our~~claims ~~10.50%~~and ~~Senior Secured Notes (the "Senior Secured Notes")~~disputes, ~~our~~including ~~9.00%~~labor ~~Senior~~regulation ~~Unsecured~~claims ~~Notes~~and ~~(the~~OSHA ~~"Unsecured Notes"), our credit facilities or other indebtedness we may incur, depends on our future performance, which is subject to economic, financial, competitive~~ and ~~other~~environmental regulation ~~factors~~violations ~~beyond~~arising ~~our~~in ~~control~~the ~~including~~ordinary acourse ~~delay to ramp-up production at our new zinc facility because~~ of ~~our inability to correct current operational issues or future unforeseen operational issues. Our~~ business ~~may not continue to generate cash flow from operations sufficient to service our debt and make necessary capital expenditures~~. If weWhile ~~are~~the ~~unable~~ultimate toeffect ~~generate~~of such ~~cash~~actions ~~flow,~~cannot ~~we may~~ be ~~required~~predicted towith ~~adopt one or more alternatives~~certainty, ~~such~~we asexpect ~~selling assets, restructuring debt or obtaining additional equity capital on terms~~ that ~~may be onerous. Our ability to refinance our indebtedness will depend on~~ the ~~capital~~outcome ~~markets and our financial condition at such time. We may not be able to engage in any~~ of these ~~activities~~matters orwill ~~engage~~not ~~in these activities on desirable terms, which could~~ result in a ~~default~~material onadverse ~~the~~effect ~~Convertible~~on ~~Notes,~~our ~~the Senior Secured Notes~~business, financial ~~the~~condition ~~Unsecured Notes, our credit facilities~~ or ~~other~~results ~~debt~~of ~~obligations we may incur~~operations.

~~Work~~22 ~~stoppages and other labor matters could interrupt our production or increase our costs, either of which would negatively impact our operating results.~~

AsTable of December 31, 2014, we had 747 employees, 281, or approximately 38%, of whom were covered by six union contracts. The collective bargaining agreements for our Palmerton, Pennsylvania and Rockwood, Tennessee facilities expire in April and July of 2015 and the rest of our collective bargaining agreements expire between 2016 and 2017. We may be unable to resolve any present or future contract negotiations without work stoppages or significant increases in costs, which could have a material adverse effect on our financial condition, cash flows and operating results. We may be unable to maintain satisfactory relationships with our employees and their unions, and we may encounter strikes, further unionization efforts or other types of conflicts with labor unions or our employees, which may interfere with our production or increase our costs, either of which would negatively impact our operating results. Contents

23On February 2, 2016, the Debtors filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. The Debtors continue to operate their businesses as debtors-in-possession subject to the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court. The commencement of the Debtors’ Chapter 11 Cases constituted events of default that rendered the financial obligations under the Company’s series of notes automatically and immediately due and payable, subject to the imposition of the automatic stay arising pursuant to Section 362 of the Bankruptcy Code. The Chapter 11 Cases are discussed in greater detail in the accompanying Notes to Consolidated Financial Statements.

~~Table~~ITEM of4. ~~Contents~~MINE SAFETY DISCLOSURES

Fluctuations in the cost or availability of electricity, coke, and/or natural gas would lead to higher manufacturing costs, thereby reducing our profit margins and limiting our cash flows from operationsNone.

~~Energy~~23 is one of our most significant costs, comprising approximately $55 million of our production costs during 2014 at our Monaca facility until its permanent closure in April 2014, our Mooresboro facility since it's startup of operations in May 2014 and our recycling facilities. Our processes rely on electricity, coke and natural gas in order to operate, and our freight operations depend heavily on the availability of diesel fuel. Energy prices, particularly for electricity, natural gas, coke and diesel fuel, have been volatile and have exceeded historical averages in recent years. These fluctuations impact our manufacturing costs and contribute to earnings volatility. We estimate that a hypothetical 10% increase in electricity, natural gas and coke costs would have reduced our income from operations by approximately $5.5 million for 2014. In addition, at most of our facilities we do not maintain sources of secondary power, and therefore any prolonged interruptions in the supply of energy to our facilities could result in lengthy production shutdowns, increased costs associated with restarting production and waste of production in progress. We have experienced rolling power outages in the past, and any future outages would reduce our production capacity, reducing our net sales and potentially impacting our ability to deliver products to our customers.

IfTable we were to lose order volumes from any of our major customers, our sales could decline significantly and our cash flows may be reduced.Contents

InPART ~~2014,~~II our ten largest customers were responsible for 44% of our consolidated sales. In 2014, three of INMETCO’s customers provided 77% of its sales. A loss of order volumes from, or a loss of industry share by, any major customer could negatively affect our financial condition and results of operations by lowering sales volumes, increasing costs and lowering profitability. In addition, some of our customers could become involved in bankruptcy or insolvency proceedings and could default on their obligations to us. We may be required to record significant additional reserves for accounts receivable from customers which may have a material impact on our financial condition, results of operations and cash flows.

~~Our~~Market ~~operations~~Information are subject to numerous federal and state statutes that regulate the protection of the health and safety of our employees, and changes in health and safety regulation could result in significant costs, which would reduce our profit margins and adversely affect our cash flow from operations.

WeOur ~~are~~common ~~subject~~stock towas ~~the~~listed ~~requirements~~on ofThe ~~the~~NASDAQ ~~U.S.~~Global ~~Occupational~~Select ~~Safety~~Market ~~and~~under ~~Health~~the ~~Administration~~symbol (“~~OSHA~~ZINC”), ~~and~~from ~~comparable state statutes that regulate the protection of the health and safety of workers. In addition~~August 10, ~~the~~2007 ~~OSHA hazard communication standard requires that information be maintained about hazardous materials used or produced in operations and that this information be provided~~ to ~~employees~~ February 10, ~~state and local government authorities and customers~~2016. We are also subject to federal and state laws regarding operational safety. Costs and liabilities related to worker safety may be incurred and any violation of health and safety laws or regulations could impose substantial costs on us. Possible future developments, including stricter safety laws for workers or others, regulations and enforcement policies and claims for personal injury or property damages resulting from our operations could result in substantial costs and liabilities that could reduce the amount of cash that we would otherwise have to distribute or use to service our indebtedness or further enhance our business.

IfOn February 2, 2016, we ~~fail~~received tonotice ~~implement~~from ~~our~~NASDAQ ~~business~~stating ~~strategy,~~that our ~~financial~~common ~~condition~~stock would be delisted and ~~results~~trading of ~~operations~~our ~~could~~common stock would be ~~materially~~suspended at the opening of business on Thursday, February 11, 2016. On February 23, 2016, NASDAQ filed a Form 25 with the SEC, which removed our common stock from listing and ~~adversely~~registration on ~~affected~~The NASDAQ Stock Market.

~~Our~~According ~~ability~~ to ~~achieve~~the ~~our~~letter, ~~business~~the ~~and~~delisting ~~financial~~was ~~objectives is subject to~~ a ~~variety~~consequence of: ~~factors~~(i) our February 2, 2016 ~~many~~filing of ~~which~~the ~~are~~Bankruptcy ~~beyond~~Petitions ~~our~~for ~~control.~~reorganization ~~For~~under ~~example,~~Chapter ~~factors~~11 ~~such~~of asthe ~~increased~~United ~~competition,~~States ~~legal~~Bankruptcy Code and ~~regulatory~~associated ~~developments,~~public ~~general~~interest ~~economic~~concerns ~~conditions~~raised orby ~~increased~~the ~~operating~~filing; ~~costs~~(ii) concerns ~~could~~regarding ~~prevent~~the usresidual ~~from~~equity ~~increasing~~interest ~~our~~of ~~capacity,~~the ~~implementing~~existing listed ~~further~~securities ~~productivity~~holders; ~~improvements,~~and ~~investing~~(iii) concerns inabout ~~technology~~our ~~upgrades~~ability orto ~~continuing~~sustain tocompliance ~~enhance~~with ~~our~~all ~~business~~requirements ~~and~~for ~~product~~continued ~~mix~~listing on NASDAQ.

AnWe ~~important~~did ~~part~~not ofappeal ~~our~~NASDAQ’s ~~strategy is to grow our business by expanding our capacity to process EAF dust~~determination. ~~One~~ ~~new~~Our ~~kiln~~common tostock ~~process~~currently ~~EAF~~trades ~~dust~~on ~~was~~the ~~placed~~Pink ~~into service in 2008 at our Rockwood~~market, ~~Tennessee~~operated ~~facility~~by ~~and~~the ~~two~~OTC Markets ~~new kilns were placed into service in 2010 at our new recycling facility in Barnwell~~Group, ~~South~~under ~~Carolina. In addition, we began production at our new zinc facility in May 2014 and may initiate other construction projects in~~ the ~~future.~~symbol ~~Our costs in connection with construction projects may also increase to levels that would make our facilities unprofitable to operate~~ZINCQ. ~~Our planned projects may also suffer significant delays or cost overruns as a result of a variety of factors, such as operational issues, shortages of workers or materials, transportation~~

24The highest and lowest sale prices of our common stock for 2014, 2015 and 2016 through February 10, 2016 were:

Table of Contents


Quarter	High		Low
2016
01/01/16 - 02/10/16		$2.15		$0.06

2015
10/01/15 - 12/31/15		$6.02		$1.57
07/01/15 - 09/30/15		$11.90		$3.02
04/01/15 - 06/30/15		$15.18		$11.67
01/01/15 - 03/31/15		$16.05		$11.88

2014
10/01/14 - 12/31/14		$16.77		$13.88
07/01/14 - 09/30/14		$21.02		$16.42
04/01/14 - 06/30/14		$18.37		$14.96
01/01/14 - 03/31/14		$18.83		$14.31

~~constraints,~~24 adverse weather, unforeseen difficulties or labor issues, any of which could prevent us from completing our expansion plans as currently expected. Our project plans may also result in other unanticipated adverse consequences, such as the diversion of management’s attention from our existing operations. Even if we are able to implement our strategy, projected volumes with respect to our products may not materialize to the extent we expect, or at all, resulting in under-utilized capacity. In addition, as part of our business strategy, we seek to identify and enter new markers and to increase our production capacity, product offerings, customers base, operating flexibility and product margins through strategic acquisitions and internal expansion opportunities and have estimated potential investment amounts involved in such opportunities. However, there is no guarantee that we will pursue these opportunities, that the actual investment amounts will equal our estimates or that we will obtain any benefits from these investments, if pursued.

AnyTable failure to successfully implement our business strategy, including for any of the above reasons, could materially and adversely affect our financial condition and results of operations. We may, in addition, decide to alter or discontinue certain aspects of our business strategy at any time.Contents

~~Current~~COMPARISON orOF ~~future~~MONTH ~~credit~~END ~~and~~STOCK ~~financial~~PRICE ~~market~~VS ~~conditions~~LME ~~could~~AVERAGE ~~materially~~CASH ~~and~~ZINC ~~adversely~~PRICE ~~affect our business and results of operations in several ways.~~

LOGO

~~Financial~~As ~~markets~~of ~~in the United States~~August 31, ~~Europe and Asia have experienced disruption~~2016, ~~including,~~there ~~among~~was ~~other~~1 ~~things, volatility~~holder ~~in securities prices, diminished liquidity and credit availability, rating downgrades~~ of ~~certain~~record ~~investments and declining valuations~~ of ~~others. Despite~~our ~~improvements~~common instock ~~credit~~ and approximately ~~financial markets~~4,000 ~~there~~beneficial ~~can~~owners beof ~~no assurance that there will not be further deterioration in these markets and confidence in economic conditions. These economic developments affect businesses~~ such ~~as ours in a number of ways~~stock. ~~Tightening~~ ofThe ~~credit~~transfer inagent ~~financial markets may delay or prevent our customers from securing funding adequate to honor their existing contracts with us or to enter into new contracts to purchase our products~~ and ~~could~~registrar ~~result in a decrease in or cancellation of orders~~ for our ~~products. Our~~common ~~customers~~stock ~~may~~is ~~also~~Computershare, ~~seek~~P.O. toBox ~~delay~~43078, ~~deliveries~~Providence, ofRhode ~~our~~Island, ~~products under existing contracts~~02940-3078, ~~which~~Toll-free ~~may~~telephone ~~postpone~~800-622-6757 ~~our~~(US, ~~ability~~Canada, toPuerto ~~recognize~~Rico), 781-575-4735 ~~revenue on contracts in our order backlog~~(non-US).

~~Our~~Unregistered ~~business~~Sales ~~is also adversely affected by decreases in the general level~~ of ~~economic~~Equity ~~activity,~~Securities including the levels of purchasing and investment in general. Strengthening of the rate of exchange for the U.S. dollar against certain major currencies may adversely affect our results or may adversely affect our domestic customers’ ability to export their product. We may also face increased risk that the counterparty or clearing agent to a hedging transaction that we enter or have entered into may default on its obligation to pay or deliver under the forward contract. We are unable to predict the likely duration and severity of disruptions in financial markets and sluggish economic conditions in the United States and other countries, and any resulting effects or changes, including those described above, may have a material and adverse effect on our business, results of operations and financial condition.

Our business could be harmed if we do not successfully manage the integration of businesses that we acquire in the future or we may not realize all or any of the anticipated benefits from acquisitions we make in the futureNone.

AsDividends part of our business strategy, we have and may continue to acquire other businesses that complement our core capabilities, including the acquisition of Zochem on November 1, 2011 and HZP on November 16, 2012. The benefits of an acquisition, including our recent acquisitions, may often take considerable time to develop and may not be realized. Business acquisitions entail a number of inherent risks such as:

•We ~~the~~currently ~~potential~~do ~~loss~~not plan to pay dividends on our common stock. As a result of ~~key~~our ~~customers~~Macquarie credit facility entered into on July 6, 2015 and ~~employees~~our ofZochem credit facility entered into on April 29, 2014, Horsehead, Zochem and INMETCO were restricted, under certain circumstances, from providing cash to us. These restrictions limited our ability to pay dividends on our common stock during the ~~acquired~~terms ~~business;~~of our two credit facilities.

•In addition, the ~~in-ability~~indenture togoverning ~~achieve~~our ~~the~~10.50% ~~operating~~Senior Secured Notes due 2017 and ~~financial~~the ~~synergies~~indenture ~~anticipated~~governing ~~from~~our an9.00% ~~acquisition;~~Unsecured Notes due 2017 restrict the declaration and payment of dividends.

•Any ~~disruptions~~future ~~that~~determination ~~can~~to ~~arise~~pay ~~from~~dividends ~~the~~will ~~integration~~depend upon, among other factors, our results of ~~the~~operations, ~~acquired~~financial condition, ~~business;~~capital requirements, debt covenants, contractual restrictions, our voluntary proceedings for reorganization under Chapter 11 and any other considerations our board of directors deems relevant.

•25 ~~potential unknown liabilities or other difficulties associated with the acquired businesses.~~

AsTable a result of the aforementioned and other risks, we may not realize the anticipated benefits from acquisitions, which could adversely affect our business.Contents

~~Litigation~~Securities ~~related~~Authorized tofor ~~worker~~Issuance ~~safety~~under orEquity ~~employment~~Compensation ~~laws~~Plans ~~may result in significant liabilities and limit our profitability.~~

WeThe ~~may~~following betable ~~involved~~sets inforth ~~claims~~certain ~~and~~information ~~litigation~~for ~~filed~~each ~~on behalf~~ of ~~persons alleging injuries suffered predominantly because of occupational exposure to substances at~~ our ~~facilities,~~equity orcompensation ~~allegations~~plans ofas ~~violations~~ of ~~laws prohibiting discrimination~~December 31, ~~or harassment or providing other rights relating to the employment relationship~~2015. It is not possible to predict the ultimate outcome of these claims and lawsuits due to the unpredictable nature of personal injury or employment law litigation. If these claims and lawsuits, individually or in the aggregate, were finally resolved against us, our results of operations and cash flows could be adversely affected.

Number of
Securities to be
Issued Upon
Exercise of
Outstanding
Options,
Warrants
and Rights

Weighted-Average
Exercise Price of
Outstanding
Options, Warrants
and Rights

Number of
Securities
Remaining Available
for Future Issuance
Under Equity
Compensation Plan

Equity Compensation plans approved by stockholders:

Amended and Restated 2006 Long-Term Equity Incentive Plan (“LTIP”)

798,415

13.00

***

2012 Incentive Compensation Plan (“ICP”)

929,686

1,711,506

Equity Compensation plans not approved by stockholders:

None

~~Table~~* This amount is based on the potential vesting of ~~Contents~~528,643 shares of common stock that could vest upon the maximum level of achievement for the 210,587 units of performance-based Restricted Stock Units (“RSUs”) that were issued in January of 2014 and 2015. All RSU’s will be canceled upon emergence from bankruptcy.

We** ~~are~~The ~~subject~~number toprovided ~~stringent~~is ~~environmental~~the ~~regulation,~~exercise ~~which~~price ~~may~~of ~~cause~~options. usRSU’s tothat ~~incur~~vest ~~significant~~under ~~costs~~the ~~and~~LTIP ~~liabilities~~or ~~that~~the ~~could~~ICP ~~materially~~do ~~harm~~not ~~our~~require ~~operating~~payment ~~results~~by the holder upon their vesting.

~~Our~~*** ~~business~~The is2012 ~~subject~~Incentive toCompensation aPlan ~~variety~~was ofadopted ~~environmental~~after ~~regulations~~approval ~~and~~by ~~our operations expose us to various potential environmental liabilities. For example, we recycle EAF dust, which is listed and regulated as a hazardous waste under~~ the ~~EPA~~Company’s ~~solid~~stockholders waste Resource Conservation and Recovery Act ("RCRA"). Failure to properly process and manage EAF dust could result in significant liability for us, including, among other things, costs for health-related claims or for remediation of hazardous substances in the environment. In addition, as part of the purchase of assets out of bankruptcy, we inherited responsibility for several environmental issues from our predecessor at our Palmerton, Pennsylvania and Bartlesville, Oklahoma facilities. The issues related to our Palmerton, Pennsylvania facility are cited in a 1995 EPA and Pennsylvania Department of Protection ("PADEP") consent decree, and the ~~matters~~2012 ~~relating~~Annual toMeeting ~~our Bartlesville, Oklahoma facility are covered in a RCRA post-closure care permit issued by the Oklahoma Department~~ of ~~Environmental Quality. A reserve in the amount of $2.2 million was originally established as of December 31~~Stockholders, ~~2010,~~no tofurther ~~cover~~awards ~~the~~will ~~cost~~be ofgranted ~~construction~~under of a storage building for calcine kiln feed materials at our Palmerton, Pennsylvania facility ($1.5 million) and for ongoing post-closure groundwater monitoring and maintenance activities at our Bartlesville, Oklahoma facility ($0.7 million). The reserve ($1.5 million) for the ~~Palmerton,~~2006 ~~Pennsylvania facility was removed during 2011 since the PADEP concurred with our assessment that construction of the storage building for calcine feed was not necessary~~LTIP. ~~Consequently, no further reserves have been recorded.~~

~~Our~~26 Barnwell, South Carolina facility and our Rockwood, Tennessee facility have been the subject of EPA and state agency investigations alleging violations under RCRA. In connection with these investigations, we are currently working on a settlement with the U.S. Department of Justice, EPA Region 4, and the state agencies. Although the various agencies have acknowledged our efforts to cooperate with these investigations and the improvements and investments made at the facilities to address identified issues, if a settlement is not reached, the government may seek penalties and/or issue permanent injunctions against us. We cannot guarantee that we will be able to reach a satisfactory settlement on these matters, nor can we anticipate the amount of penalties, if any, that may be involved, or other actions that we may be required to complete.

WeTable may also incur costs related to future compliance with or violations of applicable environmental laws and regulations, including, but not limited to, air emission regulations under possible future “Maximum Achievable Control Technology” (“MACT”) rules relating to the Company's operations such as regulations relating to non-ferrous secondary metals production. Our total cost of environmental compliance at any time depends on a variety of regulatory, legal, technical and factual issues, some of which cannot be anticipated. For example, in June 2014, we received a notice and findings of violation from Illinois EPA and EPA Region 5 alleging violations of certain provisions of our Calumet, Illinois facility’s Title V Operating Permit and state and federal air regulations. Although we do not believe that these allegations represent a material risk for us, we believe that the entry into a consent order is likely to occur in this case. We cannot speculate as to the content of the consent order or in any other way guarantee the outcome of these investigations and the impact they could have on our environmental compliance costs. Additional environmental issues could arise, or laws and regulations could be passed and promulgated, resulting in additional costs, which our reserves may not cover and which could materially harm our operating results.Contents

~~Potential~~Performance ~~federal~~Graph ~~climate change legislation or greenhouse gas regulation could result in increased operating costs and reduced demand for our products.~~

~~Over~~The ~~the~~following ~~past~~graph ~~several~~compares ~~years,~~the ~~Congress~~five-year ~~has~~cumulative ~~considered~~stockholder ~~legislation~~return ~~that~~on ~~would~~our ~~cap~~common ~~and~~stock ~~reduce~~with ~~emissions~~the ofreturn ~~greenhouse~~on ~~gases~~the ~~GHGs~~Russell 2000 ~~for~~Index ~~most~~and ~~industrial~~a ~~sectors,~~Peer ~~although~~Group toIndex, ~~date~~from noJanuary 1, ~~major~~2010 ~~climate~~through ~~change bill has been enacted. In June~~December ~~2009~~31, 2015, the ~~U.S.~~end ~~House~~ of ~~Representatives~~our ~~passed~~fiscal ~~the~~year. ~~American~~The ~~Clean~~graph ~~Energy~~assumes ~~Security~~investments ~~Act~~ of ~~2009~~$100 on January 1, ~~which~~2010 ~~was~~in ~~introduced~~our bycommon ~~Rep.~~stock, ~~Henry~~the ~~Waxman~~Russell ~~(D-CA)~~2000 Index and ~~Rep.~~the ~~Edward~~Peer ~~Markey~~Group Index ~~(D-MA)~~ and ~~commonly~~assumes ~~known~~the asreinvestment ~~“Waxman-Markey.” This~~of ~~bill~~all ~~would~~dividends. ~~have~~Since ~~established~~2013, ana ~~economy-wide~~portion ~~cap-and-trade~~of ~~system~~management’s ~~for~~long ~~emissions~~term ofincentive ~~GHGs,~~program ~~seeking~~has tobeen ~~reduce~~based ~~them~~on ~~17%~~the ~~below~~performance ~~2005~~of ~~levels~~the byCompany’s ~~2020~~total ~~and~~shareholder ~~83%~~return ~~below~~over ~~2005~~a ~~levels~~three byyear ~~2050. Under~~period ~~Waxman-Markey,~~compared ~~sources~~to that ~~emit~~of a ~~GHGs~~group ~~would~~of ~~have~~global ~~been~~metals ~~required~~companies. toBased ~~hold~~on anthis ~~emission~~change, ~~allowance~~management orhas anprepared ~~offset~~the ~~credit~~performance ~~for~~graph ~~each~~based ~~carbon~~on ~~dioxide-equivalent~~the ~~ton~~global ofmetals acompanies ~~GHG~~which ~~emitted~~are orincluded ~~produced~~in onthe ~~site. Broadly,~~calculation ~~Waxman-Markey~~under ~~and~~the ~~similar~~long ~~regulatory~~term ~~programs~~incentive ~~would~~program. ~~likely~~The ~~have~~Peer ~~resulted~~Group inis ~~increased~~composed ~~costs~~of HudBay ~~associated~~Minerals, ~~with~~Inc., ~~the~~Nyrstar, ~~production~~Materion ~~and~~Corporation, ~~combustion~~Quanex ofBuilding ~~carbon-intensive~~Products ~~fuels~~Corporation, ~~such~~Vale ~~as coal~~S.A., ~~oil,~~Freeport-McMoRan ~~refined~~Copper & ~~petroleum~~Gold ~~products~~Inc., ~~and~~Teck ~~gas.~~Resources ~~This~~Limited, ~~bill~~Hecla ~~was~~Mining ~~originally~~Co., ~~passed~~Haynes inInternational, ~~the U~~Inc.S. ~~House,~~and ~~but~~Glencore ~~was~~plc. ~~defeated~~and inis weighted ~~the~~by ~~Senate~~each inof ~~2009. It~~their isrelative ~~possible~~market ~~that~~capitalizations ~~similar~~at ~~legislation~~the ~~could~~beginning beof ~~proposed~~each ~~again~~year infor ~~the~~which ~~near~~returns ~~future~~are reported.

InCOMPARISON ~~addition,~~OF ~~the~~5 YEAR ~~EPA~~CUMULATIVE ~~has~~TOTAL ~~begun~~RETURN* regulating GHG emissions under the Clean Air Act (the "CAA") in response to the Supreme Court’s 2007 decision in Massachusetts v. EPA. In December 2009, the EPA published its findings that atmospheric concentrations of GHGs endanger public health and welfare pursuant to the CAA and that GHG emissions from new motor vehicles and new motor vehicle engines are contributing to air pollution endangering public health and welfare pursuant to the CAA (the “endangerment finding”). Although these findings do not by themselves impose any requirements with respect to sources emitting

26Among Horsehead Holding Corp., the Russell 2000 Index and Peer Group

LOGO

~~Table~~*$100 invested on 12/31/10 in stock or index, including reinvestment of ~~Contents~~dividends.

~~GHGs~~Copyright ~~and~~2016 ~~contain~~Russell noInvestment ~~specific~~Group. ~~emission~~All ~~reduction~~rights ~~targets, they have resulted in subsequent efforts by the EPA to regulate GHGs under the CAA~~reserved.

Following the endangerment finding, the EPA conducted several rulemakings that, if ultimately implemented, would regulate GHGs from certain stationary sources under the CAA. Separately, the EPA has promulgated a series of rulemakings requiring the reporting of GHG emissions. The adoption and implementation of any regulations imposing reporting obligations on, or limiting emissions of GHGs from, our equipment and operations could require us to incur significant costs to reduce emissions of GHGs associated with our operations.


Fiscal Year ending December 31	2010	2011	2012	2013	2014	2015
Horsehead Holding Corp.	100	69	78	124	121	16
Russell 2000	100	96	111	155	162	155
Peer Group	100	65	65	59	44	15

OnIssuer ~~October~~Purchases ~~30, 2009, the EPA promulgated the Final Rule for the Mandatory Reporting~~ of ~~GHG. This~~Equity ~~rule~~Securities became effective on December 29, 2009. As part of this rulemaking the EPA identified zinc production as a Source Category consisting of zinc smelters and secondary zinc recycling facilities in Subpart GG of 40 CFR Part 98. This requires the reporting of carbon dioxide (“CO2”), methane (“CH4”), and nitrous oxide (“N2O”) from each Waelz kiln and electrothermic furnace used for zinc production. Additionally CO2, CH4 and N2O from each stationary combustion unit other than the Waelz kilns must also be reported. Starting in 2010, GHG emissions for sources emitting greater than 25,000 metric tons of CO2 equivalents (CO2(e)) are to be reported into a national database set up by the EPA. Some states such as Pennsylvania are now asking that this also be reported as part of an annual inventory submittal.

InWe ~~addition~~did to the reporting rule on May 13, 2010, the EPA issued a GHG Tailoring Rule that sets thresholds for GHG emissions that define when permits under the New Source Review Prevention of Significant Deterioration (PSD) and Title V Operating Permit programs are required for new and existing sources. Following judicial challenges to the Tailoring Rule, the United States Supreme Court determined in June 2014, in Utility Air Regulatory Group v. EPA, that the CAA does not ~~authorize~~repurchase ~~application~~any of ~~PSD~~our tocommon ~~proposed~~stock ~~new~~during ~~stationary sources or major modifications of existing sources if~~ the ~~only~~fourth ~~pollutants~~quarter for which the project would be determined to be significant are GHGs. Similarly, the obligation to obtain a Title V Operating Permit would not be triggered for such sources. However, the Court also found that if a source is otherwise required to have a PSD permit based on emissions of ~~conventional, non-GHG pollutants,~~ the ~~permit~~fiscal ~~may~~year ~~contain~~ended ~~GHG limits based on the application of Best Available Control Technology standards (BACT)~~December 31, ~~and likewise~~2015, ~~Title V Operating Permits may incorporate~~ and we ~~assure~~do ~~compliance~~not ~~with~~have ~~GHG BACT limits that remain applicable requirements under~~ a ~~PSD~~formal ~~permit~~or ~~issued~~publicly toannounced ~~such~~stock ~~sources.~~repurchase ~~Furthermore, the Court’s ruling does not preclude imposition of GHG permitting requirements at the state level~~program. ~~Although EPA has issued guidance to assist permitting authorities in addressing the implications of the Court’s decision in the short term, additional regulatory revisions are~~

~~anticipated~~27 ~~at both the federal and state levels to fully implement the Court’s decision relative to affected permitting programs.~~

EPATable rulesof regulating GHG emissions have resulted and will continue to result in electric utilities increasing their rates to pay for compliance measures, and our electric power costs could significantly increase as a result.Contents

WeITEM ~~believe we are in substantial compliance with existing environmental laws and regulations applicable to our current operations~~6. ~~However,~~ ~~accidental~~SELECTED ~~spills~~FINANCIAL or releases or other events may occur in the course of our operations, and we cannot give any assurance that we will not incur substantial costs and liabilities as a result of such spills or releases or other events, including those relating to claims for damage to property, persons, natural resources or the environment. Moreover, we cannot give any assurance that the passage of more stringent laws or regulations in the future will not have a negative effect on our business, financial condition and results of operations. DATA

~~Our~~We ~~hedging~~have ~~strategies~~derived ~~may~~the ~~fail~~selected tohistorical ~~protect~~consolidated usfinancial information as of December 31, 2013, 2012 and 2011 and for the years ended December 31, 2012 and 2011 from ~~changes~~our audited consolidated financial statements, which are not included in this Annual Report on Form 10-K. We have derived the ~~prices~~selected historical consolidated financial information as of December 31, 2015 and 2014 and for ~~natural~~the ~~gas~~years ended December 31, ~~zinc~~2015, 2014 and ~~nickel~~2013 from our audited consolidated financial statements, which ~~could~~are ~~reduce~~included elsewhere in this Annual Report on Form 10-K. The selected historical consolidated financial and other information presented below is condensed and may not contain all of the information that you should consider. You should read this information in conjunction with our ~~gross~~consolidated ~~margin~~financial statements, including, where applicable, the related notes, and ~~cash~~the ~~flow~~“Management’s Discussion and Analysis of Financial Condition and Results of Operations” section included in this Annual Report on Form 10-K.

We pursue various hedging strategies, including entering into forward purchase contracts and call and put options, in order to reduce our exposure to losses from adverse changes in the prices for natural gas, zinc and nickel. Our hedging activities may fail to protect or could harm our operating results because, among other things:


	Year ended December 31,
	2015		2014		2013		2012		2011
Statements of operations data (1)	(in thousands, except for LME price and per share data)
Net sales	$	414,943	$	453,937	$	441,936	$	435,666	$	451,180
Cost of sales (excluding depreciation and amortization)		443,660		414,159		404,759		406,621		367,181
(Gain) loss on asset dispositions		(11,029)		915		701		631		423
Impairment loss (3)		527,621		—		9,349		25,305		9,797
Depreciation and amortization		54,824		35,406		29,678		26,193		22,025
Selling, general and administrative expenses		26,580		24,149		22,207		20,882		22,942

Total costs and expenses		1,041,656		474,629		466,694		479,632		422,368
Loss from operations		(626,713)		(20,692)		(24,758)		(43,966)		28,812
Interest expense		(39,280)		(21,680)		(2,728)		(7,864)		(3,324)
Gain on bargain purchase of a business		—		—		—		1,781		4,920
Interest and other income		946		13,942		6,072		2,694		1,948

(Loss) income before income taxes		(665,047)		(28,430)		(21,414)		(47,355)		32,356
Income tax provision (benefit)		341		(12,974)		(7,455)		(16,928)		10,902

Net (loss) income	$	(665,388)	$	(15,456)	$	(13,959)	$	(30,427)	$	21,454

Net (loss) income per share:
Basic	$	(11.75)	$	(0.30)	$	(0.31)	$	(0.69)	$	0.49

Diluted	$	(11.75)	$	(0.30)	$	(0.31)	$	(0.69)	$	0.49

Balance sheet data (at end of period)
Cash and cash equivalents	$	25,675	$	30,714	$	136,327	$	244,119	$	188,500
Working capital (deficit) (4)		(403,682)		48,547		114,334		265,571		260,930
Property, plant and equipment, net		254,841		799,093		708,250		405,222		260,052
Total assets		392,052		973,517		1,005,312		811,828		631,492
Current maturities of long-term debt		433,079		3,044		2,870		1,285		—
Total long-term debt, less current maturities		—		406,016		354,768		263,334		79,663
Stockholders’ equity (deficit)		(148,573)		434,185		444,894		383,281		412,251
Cash Flow statement data:
Operating cash flow	$	(68,666)	$	(40,659)	$	41,995	$	64,232	$	32,274
Investing cash flow		(32,378)		(110,825)		(310,007)		(181,177)		(51,558)
Financing cash flow		96,005		45,871		160,220		172,263		98,187
Other data:
Tons of zinc product shipped		121		129		169		189		152
Average LME zinc price (2)	$	0.87	$	0.98	$	0.87	$	0.88	$	0.99
Capital expenditures		33,693		110,825		311,798		184,541		64,709
Depreciation and amortization		54,824		35,406		29,678		26,193		22,025

•(1) ~~hedging~~We ~~can~~acquired beHZP ~~expensive~~on November 16, ~~particularly~~2012 ~~during~~for ~~periods~~a purchase price of ~~volatile~~$1,101, ~~prices;~~and Zochem on November 1, 2011 for a purchase price of $15,078.

•(2) ~~available~~Average ~~hedges~~LME ~~may~~zinc ~~not~~price ~~correspond~~equals ~~directly~~the ~~with~~average ~~the~~of ~~risks~~each ~~that~~closing weLME ~~are~~price ~~seeking~~for tozinc ~~protect~~on ~~ourselves~~a ~~against;~~dollars per pound basis during the measured period.

•(3) ~~the~~The ~~duration~~Mooresboro offacility ~~the~~was ~~hedge~~impaired ~~may~~in ~~not~~2015. ~~match~~See ~~the~~discussion ~~duration~~in ofManagement’s ~~the~~Discussion ~~risk~~and ~~that~~Analysis weof ~~are~~Financial ~~seeking~~Condition toand ~~protect~~Results ~~ourselves~~of ~~against;~~Operation.

•(4) ~~the~~Debt ~~counterparty~~was orreclassified ~~clearing~~to ~~agent~~current toin a2015 ~~hedging~~as ~~transaction~~a ~~may~~result ~~default~~of ondefaults. ~~its~~See ~~obligation~~discussion toin ~~pay~~Liquidity orand ~~deliver~~Capital ~~under~~Resources of the ~~forward~~Management’s ~~contract;~~Discussion and Analysis of Financial Condition and Results of Operations.

•28 ~~we may need to post collateral with counterparties for certain hedging transactions.~~

27Table of Contents

~~Table~~ITEM of7. ~~Contents~~MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

WeYou ~~depend~~should onread the ~~service~~following discussion and analysis in conjunction with the other sections of ~~key~~this ~~individuals~~Annual Report on Form 10-K, including “Business” and “Selected Financial Data,” as well as our consolidated financial statements, including the ~~loss~~notes thereto. As described below, we are currently operating as a debtor-in-possession under Chapter 11 protection. The statements in this discussion and analysis regarding industry outlook, our expectations regarding our future performance and our liquidity and capital resources and other non-historical statements in this discussion are forward-looking statements. See the “Cautionary Statement Regarding Forward-Looking Statements.” Our actual results may differ materially from those contained in or implied in any forward-looking statements due to numerous risks and uncertainties, including, but not limited to, the risks and uncertainties described in “Risk Factors.” In considering only those events and transactions that have occurred or closed prior to the filing of ~~whom~~this Annual Report on Form 10-K, there is substantial doubt that we could ~~materially~~continue ~~harm~~as ~~our~~a ~~business~~going concern.

~~Our~~Overview success will depend, in part, on the efforts of our executive officers and other key employees, none of whom are covered by key person insurance policies. These individuals possess sales, marketing, engineering, manufacturing, financial and administrative skills that are critical to the operation of our business. If we lose or suffer an extended interruption in the services of one or more of our executive officers or other key employees, our business, results of operations and financial condition may be negatively impacted. Moreover, the market for qualified individuals may be highly competitive and we may not be able to attract and retain qualified personnel to succeed members of our management team or other key employees, should the need arise.

~~We may not be able to protect our intellectual property, particularly our proprietary technology related to the recycling of EAF dust and the processing of nickel-bearing materials.~~ Our ~~market~~Business ~~share and results of operations could be harmed.~~

WeThrough ~~rely~~the ~~upon~~operations ~~proprietary~~of ~~know-how~~our ~~and~~subsidiary, ~~continuing~~Horsehead ~~technological~~Corporation, ~~and~~we ~~operating~~are ~~innovation~~a U.S. producer of zinc metal and, ~~other~~we ~~trade~~believe, ~~secrets~~the largest toNorth ~~develop~~American ~~and~~recycler ~~maintain~~of ~~our~~EAF ~~competitive~~dust, ~~position~~a hazardous waste produced by the carbon steel mini-mill manufacturing process. ~~Our~~We ~~competitors~~also ~~could~~believe ~~gain~~that, ~~knowledge~~through the operations of our ~~know-how~~subsidiary, orZochem, ~~trade~~we ~~secrets,~~are ~~either~~the ~~directly~~largest orsingle-site ~~through~~producer ~~one~~of orzinc oxide ~~more~~in North America. Through the operations of our ~~employees~~subsidiary, orINMETCO, ~~other~~we ~~third~~believe ~~parties.~~we Ifare ~~one~~a orleading ~~more~~recycler of ~~our~~nickel-bearing ~~competitors~~waste ~~can~~generated ~~use~~by orthe ~~independently~~stainless ~~develop~~and ~~such~~specialty ~~know~~steel producers and a leading recycler of nickel-~~how~~cadmium orbatteries ~~trade~~and other ~~secrets,~~types ~~our~~of ~~market~~batteries ~~share~~in North America. Horsehead is also the parent company of Horsehead Metal Products, ~~sales~~LLC, ~~volumes~~which ~~and~~owns ~~profit~~our ~~margins~~idled ~~could~~zinc befacility ~~adversely~~in ~~affected~~Mooresboro, North Carolina.

We ~~depend~~currently onhave ~~third~~production ~~parties~~and/or ~~for~~recycling ~~transportation~~operations ~~services,~~at ~~and~~five ~~their~~facilities ~~failure~~(excluding tothe ~~deliver~~Mooresboro ~~raw~~facility) ~~material~~located toin four usstates orin ~~finished~~the United States. Zochem operates from one facility located in Canada. Our products toare ~~our~~used ~~customers~~in ~~could~~a ~~increase~~wide ~~our~~variety ~~costs~~of applications, including in the galvanizing of sheet and ~~harm~~fabricated ~~our~~steel ~~reputation~~products, as components in rubber tires, alkaline batteries, paint, chemicals and ~~operating~~pharmaceuticals ~~results~~and as a remelt alloy in the production of stainless steel.

We, together ~~rely~~with ~~primarily~~our onpredecessors, ~~third~~have ~~parties~~been ~~for~~operating ~~transportation~~in of the ~~products~~zinc weindustry ~~manufacture,~~for asmore ~~well~~than as150 years ~~the delivery of EAF dust to our recycling plants~~ and ~~other~~in ~~raw~~the ~~materials,~~nickel-bearing ~~including~~waste ~~recycled~~industry ~~zinc,~~for tomore ~~our~~than ~~production~~30 ~~facilities~~years. InOn ~~particular~~January 22, a2016, ~~substantial~~we ~~portion~~announced of the ~~raw~~idling ~~materials we use is transported by railroad, which is highly regulated. If any~~ of our ~~third-party transportation providers were to fail to deliver our products in a timely manner~~Mooresboro, weNorth Carolina ~~may~~zinc beproduction ~~unable to sell those products at full value or at all~~facility. ~~Similarly,~~The ifdecision ~~any of these providers were~~ to ~~fail~~idle tothe ~~deliver~~Mooresboro ~~raw~~facility ~~materials~~was tothe usresult ~~in a timely manner, we may be unable to meet customer demand. In addition, if any~~ of ~~these~~many ~~third parties were to cease operations or cease doing business with us~~factors, weincluding ~~may~~a bedepressed ~~unable~~zinc toprice ~~replace~~and ~~them~~our atliquidity ~~reasonable cost~~situation. ~~Any~~A ~~failure~~small ofworkforce awas ~~third-party~~retained ~~transportation provider~~ to ~~deliver~~manage ~~raw~~the ~~materials~~facility. orTo ~~finished products in a timely manner could disrupt our operations~~date, ~~harm~~the Mooresboro ~~our~~facility ~~reputation~~remains ~~and~~in ~~have~~an aidled ~~material adverse effect on our financial condition and operating results~~state.

WeOn ~~depend~~February 2, on2016, we and certain of our ~~supplier~~subsidiaries ~~relationships,~~filed voluntary ~~and~~petitions ~~adverse~~for ~~changes~~relief under Chapter 11 of the United States Bankruptcy Code in ~~these~~the ~~relationships~~U.S. orBankruptcy Court for the District of Delaware. We continue to operate our ~~ability~~businesses as debtors-in-possession subject to ~~enter~~the ~~into~~jurisdiction ~~new~~of ~~relationships~~the Bankruptcy ~~could~~Court ~~negatively~~and ~~affect~~in ~~our~~accordance ~~revenue~~with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court. As a result of the Chapter 11 Cases and various other factors, including working capital deficits, losses from continuing operations, and defaults and cross-defaults under various credit agreements, there is substantial doubt about the Company’s ability to continue as a going concern.

WeOperations rely significantly on our suppliers. Adverse changes in any of our relationships with suppliers or the inability to enter into new relationships with suppliers could negatively impact our operation and performance. Our current arrangements with suppliers may not remain in effect on current or similar terms and the impact of changes to those arrangements may adversely impact our revenue.

~~Our~~We ~~substantial~~operate as ~~indebtedness~~three ~~could~~business ~~adversely~~segments, ~~affect~~Horsehead, Zochem and INMETCO and operate in three distinct, but related, lines of business: (a) the processing of EAF dust and other zinc-bearing material to produce and sell zinc and other metals undertaken by Horsehead Corporation; (b) the production and sale of zinc oxide undertaken by Zochem; and (c) the processing of a variety of metal-bearing waste materials and the production of nickel-bearing alloys undertaken by INMETCO. The Horsehead Corporation segment generated 70%, 56% and 58% of our ~~financial~~revenues ~~flexibility~~in 2013, 2014 and ~~prevent~~2015, usrespectively; ~~from~~the ~~fulfilling~~Zochem segment generated 18%, 32% and 31% of our ~~obligations~~revenues ~~under~~in 2013, 2014 and 2015, respectively; and the ~~agreements~~INMETCO ~~governing~~segment generated 12%, 12% and 11% of our ~~indebtedness~~revenues in 2013, 2014 and 2015, respectively.

AsOur arecycling ~~result of the issuance of our Convertible Notes, our Senior Secured Notes, our Unsecured Notes, borrowings on our Credit Agreement~~ and ~~borrowings~~production ~~under~~operations ~~our~~in ~~credit facility for Horsehead~~2015, ~~our~~including ~~credit~~the currently ~~facility~~idled ~~for~~Mooresboro ~~Zochem and our credit~~ facility ~~for INMETCO~~, weformed ~~currently have~~ a ~~significant~~complete ~~amount~~recycling ~~of indebtedness~~loop. At December 31, 2014, we had $409.1 million of total indebtedness outstanding (excluding $7.9 million of letters of credit outstanding under our ABL Facility and 2014 Zochem Facility) and $11.2 million of surety bonds outstanding). We have an aggregate $5.5 million of available letter of credit and borrowing capacity under our three credit facilities and our Credit Agreement. Our substantial level of indebtedness increases the risk that we may be unable to generate cash sufficient to pay amounts due in respect of our indebtedness. Our substantial indebtedness could have other important consequences and significant effects on our business.

~~For~~29 ~~example, it could:~~

•Table limit our ability to borrow additional amounts to fund working capital, capital expenditures, debt service requirements, execution of our business strategy, or acquisitions;Contents

•Horsehead ~~require~~Corporation ~~us to dedicate a substantial portion of our cash flow from operations to pay principal and interest on our debt, which would reduce the funds available to us for other purposes;~~

•Horsehead ~~make~~Corporation usis ~~more~~a ~~vulnerable~~producer toof ~~adverse~~zinc ~~changes~~products, including zinc metal, used in ~~general~~the ~~economic~~galvanizing of steel, ~~industry~~in zinc die castings, and ~~competitive~~zinc-bearing ~~conditions~~alloys in the United States. Prior to the Petition Date, Horsehead Corporation conducted its zinc production (as opposed to recycling) operations from its facility located in ~~government~~Mooresboro, ~~regulations~~North ~~and~~Carolina, which we began constructing in ~~our~~September ~~business~~2011 byto ~~limiting~~replace our ~~flexibility~~former inzinc ~~planning~~smelter ~~for~~located in Monaca, Pennsylvania. We permanently shut down the Monaca facility in April 2014 and ~~making~~subsequently demolished it, ~~more~~and ~~difficult~~sold ~~for~~the usland toin ~~react~~June ~~quickly to~~2015, ~~changing~~although ~~conditions;~~we ~~and~~retain ownership of a non-hazardous captive landfill located at that site. The Mooresboro facility was idled on January 22, 2016.

28Horsehead Corporation also produces WOX and zinc calcine for sale to other zinc producers. Prior to the idling of the Mooresboro facility, Horsehead Corporation used WOX, the primary product of its recycling operations, as a low-cost, raw material feedstock in the production of zinc metal and value-added zinc products, which yielded a competitive cost advantage. Our EAF dust recycling operations provided us with a reliable, cost-effective source of recycled feedstock without relying on third-party sellers.

~~Table~~Since operations began at the Mooresboro facility in May 2014, we experienced a number of ~~Contents~~significant operational, production, and equipment issues associated with the attempted ramp-up of the Mooresboro facility. For example, it was discovered that the bleed treatment section of the facility was undersized causing a bottleneck to production, electrolyte quality deteriorated causing significant corrosion to electrodes in the cell house due, in part, to poor control of solids carryover into the solvent extraction units combined with equipment issues related to faulty organic filters and the HCl regeneration units, and several pumps and lines were improperly designed for the intended application. The Mooresboro facility was operating at approximately 25% of capacity during the fourth quarter of 2015. While we ultimately expected to realize substantial operating efficiencies from the Mooresboro facility once it became fully operational, we have publicly identified ongoing challenges with respect to the Mooresboro facility on numerous occasions. In total, we have invested approximately $575.0 million in the construction and development of the Mooresboro facility, excluding capitalized interest and internal labor, as of the Petition Date. On January 22, 2016, due to financial constraints, we issued notices to our employees at the Mooresboro facility under the Worker Adjustment and Retraining Notification Act and publicly announced our intention to transition the Mooresboro facility from fully operational status to operating on a “care and maintenance level” only by February 8, 2016. To date, the Mooresboro facility remains in an idled state.

•During ~~make~~the ityear ~~more~~ended December 31, ~~difficult~~2015, our operations were significantly impacted due to ~~satisfy~~the ~~our~~dramatic ~~financial~~decline ~~obligations~~in zinc, ~~including~~nickel ~~payments~~and other commodity prices, continuing issues that delayed the ramp-up of the Mooresboro zinc facility, and lower EAF dust receipts reflecting weaker steel production. Additionally, on January 22, 2016 when we temporarily idled the Mooresboro facility in the face of severe liquidity constraints and our ~~outstanding~~determination ~~series~~that the facility was incapable of ~~notes~~generating positive cash flow in the future without significant additional capital investment and/or a recovery in commodity prices, we determined a triggering event occurred related to our ~~credit~~Mooresboro ~~facilities~~facility which required us to assess if the carrying amount of this long-lived asset may not be recoverable. We performed the required first step of the impairment test and determined the carrying amount of our Mooresboro asset group exceeded the sum of the expected undiscounted cash flows. We proceeded to the second step of the impairment test where we were required to determine a fair value for the Mooresboro asset group and recognize an impairment loss if the carrying value exceeded fair value. Fair value of the Mooresboro asset group was determined using i) published prices of our publicly traded debt and equity coupled with ii) the latest twelve months revenue multiples of selected comparable guideline companies to isolate the Mooresboro asset group’s fair value. The income approach was not considered an appropriate fair value measurement due to the absence of reliable forecast data as the facility was idled indefinitely in early 2016 as a result of uncertainty around timing of future capital inflows necessary to make required capital improvements to generate positive cash flows stemming from the Chapter 11 proceedings as well as uncertainty around recovery timing of commodity prices. As a result of the impairment test, we recorded a non-cash, pretax long-lived asset impairment loss of $527.6 million for the Mooresboro asset group. The total amount of this write-down is included in Loss from operations in the Consolidated Statement of Operations for the year ended December 31, 2015. Following the write-down of the asset group, the remaining net book value of the Mooresboro asset group was $87.6 million at December 31, 2015. The impairment charge did not impact our business operation or future cash flows nor did it result in any cash expenditures. In assessing the recoverability of our long-lived assets, we are required to make assumptions regarding estimated future cash flows and other factors to determine the fair value of the respective assets. This process is subjective and requires judgment at many points throughout the analysis. If our estimates or their related assumptions change in subsequent periods or if actual cash flows or other market measures are below management’s estimates, we may be required to record impairment charges for these assets not previously recorded or additional impairments on assets already recorded.

~~Our~~The ~~ability~~Mooresboro tofacility’s ~~make~~design ~~payments~~is onintended ~~and~~to ~~refinance~~allow ~~our~~us ~~debt depends on our ability~~ to ~~generate~~produce ~~cash~~SHG ~~flow.~~zinc, ToCGG ~~some extent~~zinc, ~~this is subject to prevailing economic~~ and ~~competitive~~high ~~conditions~~grade ~~and~~zinc, in addition to ~~certain~~the ~~financial,~~prime ~~business~~western ~~and~~zinc ~~other~~we ~~factors,~~formerly ~~many~~produced ofat ~~which~~the ~~are~~Monaca ~~beyond our control~~facility. ~~Our~~The ~~business~~Mooresboro ~~may~~facility’s ~~not~~design ~~generate~~is ~~cash~~intended ~~flow~~to ~~from~~use ~~operations~~sustainable atmanufacturing ~~levels~~practices ~~sufficient~~ to ~~permit~~produce uszinc tosolely ~~pay~~from ~~principal,~~recycled ~~premium, if any, and interest on our indebtedness, and our cash needs may increase~~materials. IfThe weMooresboro ~~are~~facility ~~unable~~is designed to ~~generate~~use ~~sufficient~~significantly ~~cash~~less ~~flow~~fossil ~~from~~fuel, ~~operations~~primarily toin ~~service~~the ~~our~~form ~~debt~~of ~~and~~metallurgical ~~meet~~coke, ~~our~~than ~~other~~the ~~cash~~Monaca ~~needs~~facility, which we ~~may~~believe bewill ~~forced~~allow us to reduce orgreenhouse ~~delay~~gas ~~capital~~emissions ~~expenditures,~~and ~~sell~~particulates orinto ~~curtail~~the ~~assets~~atmosphere. orThe ~~operations,~~Mooresboro ~~seek~~facility ~~additional~~is ~~capital, or seek~~ designed to ~~restructure~~process ora ~~refinance~~wide ~~our~~range ~~indebtedness.~~of Ifrecycled weoxidic ~~must~~zinc ~~sell or curtail our assets or operations, it may negatively affect our ability to generate revenue~~materials.

~~Restrictive~~30 covenants in the indentures and credit agreements governing the Convertible Notes, Senior Secured Notes, Unsecured Notes and in the credit agreements governing our four credit facilities limit our current and future operations, particularly our ability to respond to changes in our business or to pursue our business strategies.

TheseTable indenturesof and credit agreements contain and the agreements evidencing or governing other future indebtedness may contain, restrictive covenants that limit our ability to engage in activities that may be in our long-term best interests. Contents

~~These~~Once ~~indentures~~fully operational, we believe the Mooresboro facility will eliminate the need to calcine WOX prior to its use, thereby reducing our manufacturing conversion and ~~credit~~logistics ~~agreements~~costs ~~limit~~in our ~~ability~~recycling facilities. In addition, we expect that the Mooresboro facility, once fully operational, will have lower conversion costs than the Monaca facility, allow us to: realize a higher premium on the sale of SHG and CGG zinc and recover value from the lead and silver contained in WOX in addition to increasing the total output of zinc metal from the same.

•Zochem ~~incur additional indebtedness and guarantee indebtedness;~~

•Our ~~declare~~Zochem facility, orwhich ~~pay~~we ~~dividends~~acquired on November 1, ~~redeem~~2011, ~~capital~~is ~~stock~~located orin ~~make~~Brampton, ~~other~~Ontario, ~~distributions~~Canada and produces zinc oxide. We believe Zochem is the largest single-site producer of zinc oxide in North America. The production process uses SHG zinc as raw material which is added to ~~stockholders;~~the melting section of the furnaces. The melted zinc is then boiled and the zinc vapor is combusted as it enters an oxidation chamber. The zinc oxide is then collected and packaged for shipment. The Zochem facility has the capacity to produce approximately 72,000 tons of zinc oxide a year. During 2014 and 2015, all zinc oxide was produced by our Zochem facility. Zinc oxide is used as an additive in various materials and products, including plastics, ceramics, glass, rubbers, cement, lubricants, pigments, sealants, ointments, fire retardants, and batteries.

•INMETCO ~~make investments and acquire assets;~~

•INMETCO ~~enter~~is ~~into~~a ~~agreements~~leading ~~that~~recycler ~~restrict~~of ~~distributions~~nickel-bearing ~~from~~waste ~~restricted~~generated ~~subsidiaries;~~by the stainless and specialty steel producers, and a leading recycler of nickel-cadmium and other types of batteries in North America. INMETCO operates out of a facility located in Ellwood City, Pennsylvania, which produces nickel-bearing products by using 100% recycled materials. Additionally, INMETCO collects and recycles batteries through its own collection programs and Call2Recycle, which was founded in 1994 by five major rechargeable battery makers. INMETCO also provides environmental services to generators of nickel-containing waste products, such as filter cake, spent pickle liquor, grinding swarf, and mill scale.

•Factors ~~sell~~Affecting orOur ~~transfer~~Operating ~~certain~~Results ~~assets;~~

•Sales. ~~enter~~We ~~into~~generate ~~transactions~~the ~~with~~substantial ~~affiliates;~~majority of our net sales from the sale of zinc-based products and to a much lesser extent from the sales of nickel-based products, our operating results therefore, depend heavily on the prevailing market price for zinc and nickel. Our principal raw materials are zinc extracted from recycled EAF dust, for which we receive revenue from the carbon steel mini-mill companies, and other zinc-bearing secondary materials (“purchased feedstock”) that we purchase from third parties. Costs to acquire and recycle EAF dust are not impacted significantly by fluctuations in the market price of zinc on the LME. Until it was idled on January 22, 2016, our Mooresboro facility utilized zinc recycled from EAF dust for a substantial majority of its raw materials. The cost for the remaining portion of our raw materials is directly impacted by changes in the market price of zinc. Our Zochem facility relies entirely on SHG metal that is dependent on the LME zinc price. The price of our finished products is impacted directly by changes in the market price of zinc and nickel, which can result in rapid and significant changes in our monthly revenues.

•Average ~~create~~monthly, ~~liens~~daily orand ~~use~~yearly ~~assets~~LME zinc asprices ~~security~~for inthe ~~other~~years ~~transactions;~~2005 through 2015 were as follows:

• enter into sale and leaseback transactions;


LME Zinc Prices	2005		2006		2007		2008		2009		2010		2011		2012		2013		2014		2015
Monthly Average
High	$	0.83	$	2.00	$	1.74	$	1.14	$	1.08	$	1.10	$	1.12	$	0.93	$	0.97	$	1.06	$	1.04
Low	$	0.54	$	0.95	$	1.07	$	0.50	$	0.50	$	0.79	$	0.84	$	0.82	$	0.83	$	0.91	$	0.69
Daily High	$	0.86	$	2.08	$	1.93	$	1.28	$	1.17	$	1.20	$	1.15	$	0.99	$	0.99	$	1.10	$	1.09
Daily Low	$	0.53	$	0.87	$	1.00	$	0.47	$	0.48	$	0.72	$	0.79	$	0.80	$	0.81	$	0.88	$	0.66
Average	$	0.63	$	1.48	$	1.47	$	0.85	$	0.75	$	0.98	$	0.99	$	0.88	$	0.87	$	0.98	$	0.87

•We ~~merge~~entered orinto ~~consolidate~~fixed price zinc swaps which were put in place to reduce volatility during the completion of construction and ramp-up of production at the now-idled Mooresboro facility. We received $19,075, or$741 ~~sell~~and $1,094, ~~transfer~~respectively, ~~lease~~from orthe ~~dispose~~settlement of ~~substantially~~fixed ~~all~~price ofzinc ~~our~~swaps ~~assets;~~during the years ended December 31, 2015, 2014 and 2013.

•31 ~~make certain payments on indebtedness.~~

OurTable ability to comply with these covenants will likely be affected by many factors, including events beyond our control, and we may not satisfy those requirements. A breach of the covenants or restrictions under these indentures and credit agreements could result in a default under the applicable indebtedness. Such default may allow the creditors to accelerate the related debt and may result in the acceleration of any other debt to which a cross-acceleration or cross-default provision applies. In the event the lenders under our credit facilities and holders of our notes accelerate the repayment of our borrowings, we cannot assure you that we and our subsidiaries would have sufficient assets to repay such indebtedness.Contents

~~The~~At ~~restrictions~~December 31, ~~contained~~2015, we had 4.5 tons of fixed price zinc swaps in ~~these~~place ~~indentures~~at a ~~and~~strike ~~agreements~~price ~~governing~~of $0.83 per pound for the first quarter of 2016. In January 2016, the broker holding our ~~other~~fixed ~~indebtedness~~price swap contracts required a margin call that we could ~~adversely~~not ~~affect~~meet. ~~our~~As ~~ability~~a ~~to:~~result, all of the fixed price zinc swap contracts in effect at December 31, 2015 were liquidated in early January 2016.

•Daily ~~finance~~high, ~~our~~low ~~operations;~~and yearly average LME nickel prices for the years 2010 through 2015 were as follows:

• make needed capital expenditures;


LME Nickel Prices	2010		2011		2012		2013		2014		2015
Daily High	$	11.81	$	13.17	$	9.90	$	8.44	$	9.62	$	7.01
Daily Low	$	8.36	$	7.68	$	6.89	$	5.97	$	6.06	$	3.70
Average	$	9.89	$	10.36	$	7.97	$	6.81	$	7.65	$	5.36

•Weekly ~~make~~steel ~~strategic~~industry ~~acquisitions~~capacity orutilization ~~investments~~continued orthe ~~enter~~general ~~into~~upward ~~alliances;~~trend from 2010 through the second quarter of 2012, remaining in the mid 70% range throughout that period, thereby increasing the amount of EAF dust generated and the demand for our EAF dust recycling services. During the third quarter of 2012, weekly steel industry capacity began to decline and dipped in the fourth quarter of 2012 to its lowest quarterly level since 2010. During 2013 and 2014, weekly steel industry capacity increased back to the mid to high 70% range. The weekly steel industry capacity decreased to the low 70% range during the first nine months of 2015 and dipped during the fourth quarter of 2015 to its lowest level since the end of 2010.

•The ~~withstand~~table abelow ~~future~~illustrates ~~downturn~~our inhistorical ~~our~~sales ~~business~~volumes orand ~~the~~revenues ~~economy~~for inzinc ~~general;~~and nickel-based products and EAF dust:

• 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.


	Shipments/EAF Dust Receipts						Revenue/Ton
	2015		2014		2013		2015		2014		2013
	(Tons, in thousands)						(In U.S. dollars)
Product:
Zinc Products (1)		121		129		169	$	2,010	$	2,125	$	1,966
EAF Dust		510		580		607	$	71	$	70	$	72
Nickel-based products		30		29		28	$	1,350	$	1,677	$	1,568

~~Risks~~(1) ~~related~~Includes toHZP ~~our~~from ~~Common~~November ~~Stock~~16, 2012 until production ceased during the first quarter of 2014.

~~The~~Cost ~~market~~of ~~price~~Sales ~~for~~(excluding ~~shares~~depreciation and amortization). Our cost of ~~our~~producing ~~common~~zinc ~~stock~~and nickel ~~has~~products ~~been~~consists principally of purchased feedstock, energy, maintenance and ~~may~~labor ~~continue~~costs. toPurchased befeedstock ~~highly~~related ~~volatile~~costs are driven by the percentage of purchased feed used in the feed mix, the average LME zinc price and ~~subject~~the price paid for the purchased feed expressed as a percentage of the LME average zinc price. Purchased feedstock sells at a discount to ~~wide~~the ~~fluctuations~~LME price of zinc.

~~The~~Raw ~~market~~material ~~for~~costs ~~equity~~at ~~securities~~our ~~has~~Zochem ~~been~~facility, ~~subject~~which tocomprised ~~significant~~87% ~~disruptions that have caused substantial volatility in the prices~~ of ~~these~~production ~~and other securities~~costs, ~~which~~consisted ~~may~~entirely ~~or may not have corresponded to the business or financial performance~~ of ~~the~~purchased ~~particular~~SHG ~~company~~zinc metal. The ~~market~~ price ~~for shares~~ of ~~our~~these ~~common~~metal ~~stock~~blocks ~~has~~is ~~been~~based ~~affected~~on in the ~~past~~LME ~~may~~zinc ~~continue~~price. toConversion berelated ~~affected~~costs byrepresented ~~general~~13% ~~market~~of ~~conditions~~our ~~unrelated~~2015 toproduction costs at our ~~operating~~Zochem ~~performance~~facility.

~~Some~~Certain ~~specific~~components ~~factors~~of ~~that~~our ~~may~~conversion ~~have~~costs ado ~~significant~~not ~~effect~~change onproportionally ~~the~~with ~~future~~changes ~~market~~in ~~price~~production volume. Consequently, as volume changes, a portion of our ~~shares~~conversion cost per ton changes inversely. Other components of ~~common~~cost ~~stock~~of sales include: transportation costs, as well as other manufacturing expenses. The main factors that influence our cost of sales as a percentage of net sales are fluctuations in zinc and nickel prices, production and shipment volumes, efficiencies, energy costs and our ability to implement cost control measures aimed at improving productivity.

•We value the majority of our ~~ability~~inventories using the weighted average actual cost method. Under this method, the cost of our purchased feedstock generally takes three to ~~successfully~~four ~~ramp~~months to flow through our cost of sales. In an environment of declining LME average zinc prices, our inventory cost can exceed the market value of our finished goods. As a result, lower-upof-cost-or-market ~~production~~(“LCM”) adjustments can occur. During 2015, 2014 and 2013, we recorded LCM adjustments of ~~SHG~~$4.4 million, $3.6 million and $3.7 million, respectively. The 2015, 2014 and 2013 LCM adjustments were the result of the declining LME zinc price, increased production costs in 2013 and 2014 at Monaca as the ~~new~~plant ~~zinc~~operated ~~facility~~at oninefficient levels during the ~~timetable~~impending ~~currently~~shutdown, ~~contemplated~~and the incurrence of higher than normal production costs in 2014 and, ~~once~~2015 ~~fully~~at ~~operational~~the zinc facility in Mooresboro, ~~our~~North ~~ability~~Carolina toas ~~realize~~it operated at inefficient levels during startup. Zochem values its inventory using the ~~benefits~~first wein-first ~~expect~~out tomethod ~~achieve~~and ~~from~~therefore ~~that~~the ~~facility;~~majority of the cost of its purchased feedstock generally flows through cost of sales during the same month it is purchased.

•Selling, ~~actual~~General orand ~~expected~~Administrative ~~fluctuations~~Expenses. Our selling, ingeneral ~~our~~and ~~operating~~administrative ~~results;~~expenses consist of all sales and marketing expenditures, as well as administrative overhead costs, such as salary and benefit costs for sales personnel and administrative staff, expenses related to the use and maintenance of administrative offices, costs associated with acquisitions, other administrative expenses, including expenses relating to logistics and information systems and legal and accounting expense, and

2932

• other ~~actual~~selling orexpenses, ~~expected~~including travel costs. Salary and benefit costs historically have comprised the largest single component of our selling, general and administrative expenses. Selling, general and administrative expenses as a percent of net sales historically have been impacted by changes in ~~our~~salary ~~growth~~and ~~rates~~benefit orcosts, ~~our~~as ~~competitors’~~well ~~growth~~as ~~rates;~~by changes in selling prices.

•Fire ~~changes~~at inour ~~general~~INMETCO ~~economic~~facility ~~conditions~~on orNovember 8, ~~conditions~~2015 ~~in our industry generally;~~

•On ~~changes~~November 8, in2015, ~~market~~a ~~prices~~fire ~~for~~damaged ~~our~~a ~~products~~battery orstorage ~~for~~building at our ~~raw~~INMETCO ~~materials~~facility located in Ellwood City, Pennsylvania. The ~~including~~fire ~~changes~~did innot affect the ~~price~~facility’s primary operations. We maintain property coverage but the damages from the fire exceeded our insurance deductible of ~~zinc;~~$0.5 million.

•The ~~changes~~Company recorded $2.0 million in ~~revenue~~insurance orrecoveries ~~earnings~~during ~~estimates,~~the ~~publication~~fourth quarter of ~~research~~2015 ~~reports~~relating to property damage and this ~~recommendations~~amount byis ~~financial~~included ~~analysts;~~in Cost of sales of nickel-based materials and other services in our Consolidated Statements of Operations. The amount represented a partial settlement of the entire claim and we have not yet reached agreement with the insurance carriers on the final claim amount.

•Through ~~changes~~December 31, in2015, ~~stock~~we ~~market~~had ~~analyst~~incurred ~~research~~clean up, repair and ~~recommendations~~other costs ~~regarding~~associated with the ~~shares~~fire of ~~our~~$1.0 ~~common~~million. ~~stock,~~See ~~other~~Footnote ~~comparable~~AA ~~companies~~- orInsurance Recoveries in our ~~industry~~Audited ~~generally;~~Consolidated Financial Statements for further information.

•Trends ~~speculation~~Affecting inOur ~~the~~Business ~~press or investment community generally or relating to our reputation or our industry;~~

•Our ~~changes~~operating inresults ~~conditions~~are inand ~~the~~will ~~financial~~be ~~markets;~~influenced by a variety of factors, including:

• ~~our~~production ~~ability~~levels toat ~~raise~~our ~~additional capital~~facilities;

• ~~future~~the ~~sales~~supply of ~~our~~EAF ~~equity~~dust orfor ~~equity-related~~our ~~securities~~recycling operations;

• ~~our~~LME ~~compliance~~price ~~with~~of ~~environmental~~zinc ~~laws~~ and ~~regulations and our exposure to liabilities and potential investigations and enforcement actions with respect to such laws and regulations~~nickel;

• changes in ~~applicable~~cost ~~laws~~of orenergy ~~regulations~~and fuels;

• ~~adverse~~changes ~~market~~in ~~reaction~~the tocost ~~any~~of ~~increased~~additives ~~indebtedness~~and weprocess ~~incur in the future~~chemicals;

• ~~additions~~gain orand ~~departures~~loss of ~~key management personnel~~customers;

• ~~strategic~~pricing ~~actions~~pressures byfrom uscompetitors, orincluding ~~our~~new ~~competitors~~entrants into the zinc product markets, ~~such~~or asthe ~~acquisitions~~EAF dust or ~~restructurings;~~nickel-bearing ~~and~~waste recycling markets;

• ~~actions~~production bylevels ~~our~~in ~~stockholders~~the domestic steel industry;

As• aincreases ~~result of these~~ and ~~other~~decreases ~~factors,~~in ~~you~~the ~~may~~use ~~be unable to resell your shares~~ of ~~our~~zinc ~~common~~and ~~stock~~nickel-based ~~at or above the price you paid for such shares.~~products;

We• doexpansions ~~not~~into ~~have~~new ~~any~~products ~~current plan to pay,~~ and ~~are~~expansion ~~restricted~~of in our ~~ability to pay~~capacity, ~~any~~which ~~dividends~~requires onus ~~our~~to ~~common~~incur ~~stock,~~costs ~~and~~prior ~~as a result, your only opportunity~~ to ~~achieve~~generating ~~a return on your investment in our common stock is if the price of our common stock increases.~~revenues;

We• ~~anticipate~~expenditures ~~that~~required weto ~~will~~comply ~~retain~~with ~~all~~environmental ~~future earnings~~ and other ~~cash~~operational resources for the future operation and development of our business. Accordingly, we do not intend to declare or pay regular cash dividends on our common stock in the near future. Payment of any future dividends will be at the discretion of our board of directors after taking into account many factors, including our operating results, financial conditions, current and anticipated cash needs and plans for expansion. The declaration and payment of any dividends on our common stock is also restricted by the terms of our credit facilities and the indenture governing our Senior Secured Notes and Senior Unsecured Notes. As a result, your only opportunity to achieve a return on your investment in us will be if the price of our common stock increases and if you are able to sell your shares at a profit. You may not be able to sell shares of our common stock at a price that exceeds the price that you paid.regulations;

~~Provisions~~• ofaccess ~~our~~to ~~Second~~credit ~~Amended and Restated Certificate of Incorporation and Amended and Restated By-laws could delay or prevent a takeover of us~~ by ~~a third party and may prevent attempts by stockholders to replace or remove~~ our ~~current~~customers; ~~management.~~and

~~Provisions~~• in our ~~Second~~operational ~~Amended~~efficiency ~~and~~improvement Restated Certificate of Incorporation and Amended and Restated By-laws and of Delaware corporate law may make it difficult and expensive for a third party to pursue a tender offer, change in control or takeover attempt that is opposed by our management and board of directorsprograms. ~~These anti-takeover provisions could substantially impede the ability of public stockholders to benefit from a change of control or change our management and board of directors.~~

~~Our~~We ~~Second~~have ~~Amended~~experienced fluctuations in our sales and ~~Restated~~operating ~~Certificate~~profits ofin ~~Incorporation~~recent years due to fluctuations in zinc, energy and fuel ~~Amended~~prices. Historically, zinc prices have been extremely volatile, and ~~Restated~~we Byexpect that volatility to continue. For example, since May 2015, the price of zinc fell approximately 39%, reaching a six-~~laws:~~year low in December 2015. The price of nickel fell approximately 59% from May 2014 to December 2015. Changes in zinc pricing have impacted our sales revenues since the prices of the products we sell are based primarily on LME zinc prices, and they have impacted our costs of production, since the purchase prices of some of our feedstocks are based on LME zinc prices. Therefore, since a large portion of our sales and a portion of our costs are affected by the LME zinc price, we expect that changing zinc prices will continue to impact our operations and financial results in the future and any significant drop in zinc prices will negatively impact our results of operations.

•Energy ~~authorize~~is ~~the~~one ~~issuance~~ of ~~blank~~our ~~check~~most ~~preferred~~significant ~~stock~~costs. ~~that~~Our ~~could~~processes berely ~~issued~~primarily byon ~~our~~electricity ~~board~~and ofnatural ~~directors~~gas to ~~thwart~~operate. aOur freight ~~takeover~~operations ~~attempt;~~depend heavily on diesel fuel. Energy prices have been volatile in recent years and currently exceed long-term historical averages. These fluctuations impact our manufacturing costs and contribute to earnings volatility.

•Several ~~prohibit~~additives ~~cumulative~~and ~~voting~~process inchemicals, including but not limited to coke, and when the ~~election~~Mooresboro offacility ~~directors~~was operating, limestone, ~~which~~sulfuric ~~would~~acid ~~otherwise~~and ~~allow~~manganese ~~holders~~were ofused ~~less~~in ~~than~~our operations. Changes in price and availability have a ~~majority~~direct ofimpact ~~stock~~on toour ~~elect~~manufacturing ~~some~~costs. ~~directors;~~

•33 ~~require super-majority voting by our stockholders to effect amendments to provisions of our Second Amended and Restated Certificate of Incorporation concerning the number of directors;~~

•Table require super-majority voting by our stockholders to effect any stockholder-initiated amendment to any provision of our Amended and Restated By-laws;Contents

•Our ~~limit~~zinc ~~who~~based products compete with other materials in many of their applications. For example, PW zinc is used by steel fabricators in the hot dip galvanizing process, in which steel is coated with zinc in order to protect it from corrosion. Demand for our zinc as a galvanizing material may ~~call~~shift ~~special~~depending ~~meetings~~on how customers view the respective merits of hot dip galvanizing and paint. In addition, SHG zinc and CGG zinc are used by continuous galvanizers to produce galvanized flat-rolled sheet steel for the automotive market. There have been recent plans by some automotive companies to begin to use lightweight aluminum sheet to replace galvanized steel. Any such shifts in industry uses could affect our ~~stockholders;~~sales.

•Our ~~prohibit~~nickel-based ~~stockholder~~products ~~action~~are byused ~~written~~in ~~consent,~~the ~~thereby~~stainless ~~requiring~~steel ~~all~~industry. ~~actions~~Demand tofor beour ~~taken~~products atand services may decline if demand for stainless steel lessens. Nickel-bearing stainless steel faces competition from stainless steel containing a ~~meeting~~lower level of ~~the~~nickel ~~stockholders;~~or no nickel.

•Our ~~establish~~ability ~~advance~~to ~~notice~~anticipate ~~requirements~~shifts ~~for~~in ~~stockholder~~product ~~nominations~~usage ofand ~~candidates~~to ~~for~~produce ~~election~~new products to ~~the~~meet ~~board~~our ofcurrent ~~directors~~and orfuture ~~for~~customers’ needs ~~stockholder~~will ~~proposals~~significantly ~~that~~impact ~~can~~our beoperating ~~acted~~results. ~~upon~~We atalso ~~annual~~face ~~meetings~~intense competition from regional, national and global providers of ~~stockholders;~~zinc and nickel based products, and the growth of any of those competitors could reduce our market share and negatively impact our operating results.

•Our ~~require~~business ~~that~~is ~~vacancies~~subject onto ~~the~~a ~~board~~wide variety of ~~directors,~~environmental ~~including~~and ~~newly-created~~other ~~directorships~~regulations and our operations expose us to bea ~~filled~~wide ~~only~~variety byof potential liabilities. Our total cost of environmental compliance at any time depends on a ~~majority~~variety ~~vote~~of regulatory, technical and factual issues, some of ~~directors~~which ~~then~~cannot be anticipated. Changes in regulations ~~office~~and/or our failure to comply with existing regulations can result in significant capital expenditure requirements or penalties.

30Summary of Critical Accounting Policies and Estimates

~~Table~~Our discussion and analysis of ~~Contents~~our financial condition and results of operations are based on our consolidated financial statements, which have been prepared in conformity with accounting principles generally accepted in the United States of America. Note B to the audited consolidated financial statements included in this Annual Report on Form 10-K contains a summary of our significant accounting policies. Certain of these accounting policies are described below.

InRevenue ~~addition,~~Recognition Section 203 of the Delaware General Corporation Law may discourage, delay or prevent a change in control by prohibiting us from engaging in a business combination with an interested stockholder for a period of three years after the person becomes an interested stockholder. These provisions could limit the price that certain investors might be willing to pay in the future for shares of our common stock and limit the return, if any, you are able to achieve on your investment in us.

~~ITEM~~We ~~1B.~~recognize ~~UNRESOLVED~~revenue ~~STAFF~~from ~~COMMENTS~~the sale of finished goods when persuasive evidence of a sales arrangement exists which includes a fixed or determinable price, when passage of title or risk of loss has occurred (which is generally at the time of shipment) and when collectability is reasonably assured.

~~None~~We recognize service fee revenue when persuasive evidence of a sales arrangement exists which includes a fixed or determinable price, when passage of title or risk of loss has occurred (which is generally recognized at the time of receipt of EAF dust that the Company collects from steel mini-mill operators) and when collectability is reasonably assured.

~~ITEM~~Inventories ~~2. PROPERTIES~~

AsInventories, which consist primarily of ~~December~~zinc ~~31,~~and ~~2014~~nickel-bearing materials, ~~our~~chemical ~~zinc~~reagents ~~production~~and ~~operations~~supplies and spare parts are valued ~~located~~at the lower-of-cost-or-market using a weighted average actual cost method. Zochem values its inventory using the first-in ~~Mooresboro,~~first-out ~~North~~method. ~~Carolina,~~Raw ~~Palmerton~~materials are purchased, ~~Pennsylvania~~as ~~and~~well ~~Brampton~~as produced, ~~Ontario~~from ~~Canada~~the processing of EAF dust. Supplies and ~~our~~spare parts ~~principal~~inventory ~~zinc~~used ~~recycling~~in ~~operations~~the production process are ~~located~~purchased inand ~~Palmerton,~~depending ~~Calumet,~~on ~~Illinois;~~the ~~Rockwood~~type of supply or spare part are either classified as long-term supplies, ~~Tennessee;~~capitalized ~~and~~until ~~Barnwell~~consumption, ~~South~~or ~~Carolina~~expensed immediately. ~~Our~~ ~~nickel~~Work-in-process ~~recycling~~and ~~operations~~finished goods inventories are ~~located~~valued inbased ~~Ellwood~~on ~~City~~the costs of raw materials plus applicable conversion costs, ~~Pennsylvania~~including depreciation and overhead costs relating to associated process facilities.

Zinc ~~Our~~and ~~new~~nickel ~~zinc~~are ~~facility~~traded ~~located~~as incommodities ~~Mooresboro~~on ~~began~~the ~~production~~LME inand, ~~May~~accordingly, ~~2014.~~product ~~The~~inventories ~~facility~~are ~~converts~~subject ~~WOX~~to ~~derived~~price ~~from~~fluctuations. When ~~EAF~~reviewing ~~dust~~inventory ~~and~~for ~~other~~the ~~recycled~~lower ~~materials~~of ~~into~~cost ~~SHG~~or ~~zinc~~market adjustments, ~~CGG~~we ~~zinc~~consider ~~and~~the ~~High~~forward ~~Grade~~metal ~~zinc,~~prices inas ~~addition~~quoted toon the PWLME ~~grade~~as ~~that~~of ~~we previously~~the ~~produced~~reporting atdate in determining our ~~former~~estimate ~~Monaca,~~of ~~Pennsylvania~~net ~~facility~~realizable value and to determine if an adjustment is required. ~~This~~Our ~~new~~product ~~zinc~~revenues ~~facility~~are ~~replaced~~based ~~our~~on ~~Monaca,~~the ~~Pennsylvania~~current ~~facility~~or prior months’ LME average prices. The LME average price upon which ~~was~~our ~~permanently~~product ~~closed~~revenue inis ~~April~~based ~~2014~~has been reasonably correlated with the forward LME prices that we use to determine the lower of cost or market adjustments.

~~The~~Supplies ~~chart~~are ~~below~~adjusted ~~provides~~based aon ~~brief~~obsolescence ~~description~~and ofslow ~~each~~moving ofreviews. We record an estimate for slow moving and obsolete inventory (“inventory reserve”) based upon our ~~production~~product ~~facilities. We~~knowledge, ~~own~~physical ~~each~~inventory observation, future demand, market conditions and an aging analysis of the ~~facilities~~inventory ~~listed~~on ~~below~~hand. For “convenience,” we reduce inventory cost through a contra asset rather than through a new cost basis.

Location		Process	Product	Effective AnnualCapacity (tons)
Mooresboro, NC		Finished Product	Zinc Metal	155,000 (1)
Brampton, Ontario Canada		Finished Product	Zinc Oxide	72,000 (2)
Barnwell, SC		Recycling	WOX(3)	180,000*
Calumet, IL		Recycling	WOX	163,000*
Palmerton, PA		Recycling	Calcine	130,000 (4)
			WOX	230,000*
			Zinc Powder	5,000 to 14,000 (5)
Rockwood, TN		Recycling	WOX	162,000*
Ellwood City, PA		Recycling	Nickel-chromium-iron alloy	70,000*
Total carbon steel EAF dust Recycling Capacity				735,000
*	Represents EAF dust and other metal-bearing wastes recycling and processing capacity
(1)	The new zinc facility began operations in May 2014 and is expected to be capable of producing over 155,000 tons of zinc metal per year with equipment capable of producing over 170,000 tons of zinc metal per year without significant additional investment.
(2)	During 2014, the Zochem facility completed an expansion project and increased its former capacity of 49,600 annual tons to approximately 72,000 annual tons of zinc oxide per year.
(3)	WOX, with approximately 55% - 65% zinc content, is produced by our recycling operations and is used as a feedstock for our new zinc facility in Mooresboro or further processed in Palmerton into zinc calcine (up to 65% - 70% zinc content). WOX is used as a feedstock for the new zinc facility located in Mooresboro.
(4)	Assumes that one of four kilns is operated to produce calcine and the other three kilns are operated to produce WOX. The calcining operation will be shut down when Mooresboro begins to consistently achieve a production capacity utilization level of approximately 75%.
(5)	Depending upon grade.

WeTable believeof that our existing space is adequate for our current operations. We believe that suitable replacement and additional space will be available in the future on commercially reasonable terms.Contents

31Insurance Claim Liabilities

~~Table~~We accrue for costs associated with self-insured retention under certain insurance policies (primarily workers’ compensation) based on estimates of ~~Contents~~claims, including projected development, from information provided by the third party administrator and a third party actuarial firm. Accruals for estimated costs are undiscounted and are subject to change based on development of such claims. Changes in the estimates of the reserves are included in net income in the period determined. Amounts estimated to be paid within one year have been classified as current liabilities, with the remainder included in non-current liabilities in the Consolidated Balance Sheets.

~~ITEM~~Share-Based ~~3. LEGAL~~Compensation ~~PROCEEDINGS~~

We ~~are~~have ~~party~~a toshare-based ~~various~~compensation ~~litigation,~~plan. ~~claims~~Employee ~~and~~stock ~~disputes,~~options ~~including~~are ~~labor~~expensed ~~regulation~~over ~~claims~~the ~~and~~requisite ~~OSHA~~service ~~and~~period, ~~environmental~~based ~~regulation~~on ~~violations~~the estimated ~~arising~~fair invalue of the ~~ordinary~~award ~~course~~on the date of ~~business.~~the ~~While~~grant using the ~~ultimate~~Black-Scholes ~~effect~~option-pricing ofmodel. ~~such~~Restricted ~~actions~~stock ~~cannot~~unit beservice ~~predicted~~or ~~with~~performance ~~certainty~~related grants are expensed over the vesting period, wewith ~~expect~~the ~~that~~expense based on the ~~outcome~~stock price on the grant-date multiplied by the number of ~~these~~restricted ~~matters~~stock ~~will~~units ~~not~~granted. ~~result~~Restricted instock unit market based grants are expensed over the vesting period, with the expense determined using a ~~material~~valuation ~~adverse~~model ~~effect~~based on ~~our~~commonly ~~business,~~accepted ~~financial~~economic ~~condition~~theory which oris ~~results~~used for all valuations of ~~operations~~awards with market conditions. This economic theory is also used as a basis for the Black Scholes and Monte Carlo valuations.

~~ITEM~~Fair ~~4. MINE~~Value ~~SAFETY DISCLOSURES~~

~~None~~Fair value is measured using inputs from the three levels of the fair value hierarchy. Classification within the hierarchy is determined based on the lowest level of input that is significant to the fair value measurement.

~~PART~~The IIthree levels are described as follows:

~~ITEM~~• 5Level 1 - Unadjusted quoted prices in active markets for identical assets and liabilities. ~~MARKET~~ ~~FOR~~Cash ~~REGISTRANT'S~~and ~~COMMON~~cash ~~EQUITY~~equivalents including the money market demand account, ~~RELATED~~accounts ~~STOCKHOLDER~~receivable, ~~MATTERS~~accounts ~~AND~~payable, ~~ISSUER~~and ~~PURCHASES~~certain OFaccrued ~~EQUITY~~expenses ~~SECURITIES~~are considered to be in Level 1 of the fair value hierarchy as they approximate their fair value due to the short-term nature of these instruments. (see Note G - Cash and Cash Equivalents in our Audited Consolidated Financial Statements).

~~Market~~• ~~Information~~Level 2 - Inputs other than quoted prices included in Level 1 that are observable for the determination of the fair value of the asset or liability, either directly or indirectly. The financial swap and financial option instruments are carried at fair value and are considered to be in Level 2 of the fair value hierarchy. These derivatives are not designated as cash flow hedges and we recognize changes in fair value within the consolidated statements of operations as they occur (see Note T - Accounting for Derivative Instruments and Hedging Activities in our Audited Consolidated Financial Statements). Borrowings under our credit facilities are considered to be in Level 2 of the fair value hierarchy (see Note N - Long Term Debt). The pension assets, which are primarily invested in the Manulife Monthly High Income GIF Fund, are carried at fair value and are considered to be in Level 2 of the fair value hierarchy (see Note R - Employee Benefit Plans in our Audited Consolidated Financial Statements).

~~Our~~• ~~common~~Level ~~stock~~3 ~~has~~- ~~been~~Unobservable ~~listed~~inputs that are significant to the determination of fair value of the asset or liability. The Convertible Notes, issued on July 27, 2011, were initially valued at fair value and subsequently are carried at amortized cost. The ~~NASDAQ~~fair ~~Global~~value ~~Select~~is ~~Market~~considered ~~under~~to be in Level 3 of the ~~symbol~~fair ~~“ZINC”~~value ~~since~~hierarchy ~~August~~(see 10Note N - Long Term Debt). The Senior Secured Notes issued on July 26, ~~2007~~2012, June 3, 2013 and July 29, 2014 were initially valued at fair value and subsequently are carried at amortized cost. The ~~highest~~Unsecured Notes issued on July 29, 2014 were issued and ~~lowest~~are ~~sale~~valued ~~prices~~at par value. The fair value of these debt issuances are considered to be in Level 3 of the fair value hierarchy (see Note N - Long-Term Debt in our ~~common~~Audited ~~stock~~Consolidated ~~for~~Financial Statements). Level 3 inputs are also used in the ~~most~~determination ~~recent~~for ~~eight~~impairment ~~quarters~~testing ~~were:~~on long-lived assets.

Quarter	High	Low
2014
10/01/14 - 12/31/14	$16.77	$13.88
07/01/14 - 09/30/14	$21.02	$16.42
04/01/14 - 06/30/14	$18.37	$14.96
01/01/14 - 03/31/14	$18.83	$14.31
2013
10/01/13 - 12/31/13	$16.80	$12.07
07/01/13 - 09/30/13	$14.09	$10.85
04/01/13 - 06/30/13	$12.90	$9.38
01/01/13 - 03/31/13	$11.45	$9.69

When developing the fair value measurements, we use quoted market prices whenever available or seek to maximize the use of observable inputs and minimize the use of unobservable inputs when quoted market prices are not available.

32Derivatives

~~Table~~We do not enter into derivative financial instruments unless we have an existing asset or obligation or anticipate a future activity that could result in exposing us to market risk. We use various strategies to manage our market risk, including the use of ~~Contents~~derivative instruments to limit, offset or reduce such risk. Derivative financial instruments are used to manage well-defined commodity price risks from our primary business activity.

As35 of February 25, 2015, there were 5 holders of record of our common stock and approximately 14,000 beneficial owners of such stock. The transfer agent and registrar for our common stock is Computershare, P.O. Box 43078, Providence, Rhode Island, 02940-3078, Toll-free telephone 800-622-6757 (US, Canada, Puerto Rico), 781-575-4735 (non-US).

UnregisteredTable Sales of Equity SecuritiesContents

~~Issuance~~We record derivative instruments in current assets or current liabilities in the Consolidated Balance Sheets at fair value. These derivatives are not designated as cash flow hedges and we recognize changes in fair value within the Consolidated Statements of ~~Convertible~~Operations ~~Senior~~as ~~Notes~~they occur. The fair values of derivative instruments are based upon a comparison of third party counterparties valuations, with whom the Company has entered into substantially identical derivative contracts, to ensure that there is an acceptable level of consistency among them. The valuations utilize forward pricing and an implied volatility of the underlying commodity as well as interest rate forwards and are therefore subject to fluctuation based on the movements of the commodity markets. Cash flows from derivatives are recognized in the Consolidated Statements of Cash Flows in a manner consistent with the underlying transactions.

OnWe ~~July~~are ~~27,~~exposed ~~2011,~~to wecredit loss ~~completed~~should ~~the~~counter-parties ~~private~~or ~~placement~~clearing ofagents ~~$100.0~~with ~~million~~which ~~aggregate~~we ~~principal~~have ~~amount~~entered ofinto ~~3.80%~~derivative ~~Convertible~~transactions ~~Notes~~become ~~due~~unable ~~July~~to 1,satisfy ~~2017. The~~their ~~Convertible~~obligations ~~Notes~~in ~~were~~accordance ~~offered~~with atthe anunderlying ~~initial~~agreements. ~~issue~~To ~~price~~reduce the risk of ~~100%~~such ~~which~~losses, ~~resulted~~at points in ~~net~~time, ~~proceeds~~we utilize LME-registered contracts entered into with the London Clearing House for some of ~~$96~~our contracts.5 ~~million~~In addition, ~~after~~we ~~underwriting~~minimize ~~discounts~~credit loss by utilizing four different brokers for our derivative contracts. ~~The~~ ~~representative~~(See Note T - Accounting for ~~the~~Derivative Instruments ~~initial~~and ~~purchasers~~Hedging ~~was~~Activities ~~Stifel,~~in ~~Nicolaus~~our &Audited ~~Company,~~Consolidated ~~Incorporated~~Financial Statements).

33Impairment

~~Table~~Long lived assets, which include property, plant and equipment as well as definite life intangible assets, are reviewed for impairment when events and circumstances indicate that the carrying amount of ~~Contents~~an asset may not be recoverable. Our policy is to record an impairment loss when it is determined that the carrying amount of the asset exceeds the sum of the expected undiscounted future cash flows resulting from use of the asset, and its eventual disposition. Impairment losses are measured as the amount by which the carrying amount of the asset exceeds its fair value, normally as determined in either open market transactions or through the use of a discounted cash flow model. Long lived assets to be disposed of are reported at the lower of the carrying amount or fair value less cost to sell.

~~The~~In ~~Convertible~~assessing ~~Notes~~the ~~are~~recoverability ~~convertible into shares~~ of ~~the~~ our ~~common~~long-lived ~~stock~~assets, ~~cash,~~management ormay abe ~~combination~~required ofto ~~our~~make ~~common~~assumptions ~~stock~~regarding ~~and~~estimated future cash, atflows ~~our~~and ~~election,~~other atfactors anto ~~initial~~determine ~~conversion~~the ~~rate~~fair value of 66the respective assets.~~6667~~ ~~shares~~This ofprocess ~~our~~is ~~common~~subjective ~~stock~~and ~~per~~requires ~~$1,000~~judgment ~~principal~~at ~~amount~~many ofpoints throughout the ~~Convertible~~analysis. ~~Notes~~If ~~(approximately~~such ~~6,666,667~~estimates ~~underlying~~or ~~shares),~~their ~~which~~related isassumptions ~~equivalent~~change toin ansubsequent periods ~~initial~~or ~~conversion~~if ~~price~~actual ofcash ~~approximately~~flows ~~$15.00~~or ~~per~~other ~~share~~market ofmeasures ~~common~~are ~~stock~~below management’s estimates, ~~subject~~we may be required to ~~adjustment~~record inimpairment ~~certain~~charges ~~circumstances,~~for asthese ~~defined~~assets innot ~~the~~previously ~~indenture~~recorded ~~governing~~or ~~the~~additional ~~Convertible~~impairments ~~Notes~~on assets already recorded.

~~Holders~~We ofrecorded ~~the~~an ~~Convertible~~impairment ~~Notes~~loss ~~may convert their Convertible Notes at the applicable conversion rate at any time~~ on ~~or after April 1, 2017 until~~ the ~~close~~Mooresboro offacility ~~business~~in onDecember ~~the second business day immediately preceding the maturity date~~2015. ~~The~~ ~~Notes~~See ~~may~~Footnote beF-Asset ~~converted~~Write-Downs ~~prior~~and toDisposals in ~~April~~the 1,Consolidated ~~2017~~Financial ~~only~~Statements ~~under~~for ~~certain~~additional ~~circumstances. We~~information doon ~~not have~~ the ~~right~~impairment toloss ~~redeem~~on the ~~Convertible~~Mooresboro ~~Notes prior to the stated maturity date of July 1, 2017~~facility.

~~Neither~~We ~~the~~have ~~Convertible~~no ~~Notes~~goodwill ~~nor the shares of common stock issuable upon conversion of the Convertible Notes are registered under the Securities Act of 1933, as amended,~~ or ~~the~~indefinite ~~securities~~life ~~laws~~intangible ~~of any other jurisdiction~~assets. ~~The~~ ~~offering was only made to qualified institutional buyers in accordance with Rule 144A under the Securities Act.~~

WeAcquisitions used the proceeds from the issuance of the Convertible Notes for the initial stages of construction of our new zinc facility and general corporate purposes, including working capital needs, investment in business initiatives, capital expenditures and acquisitions.

~~Dividends~~We recognize the assets acquired and the liabilities assumed at their fair values as of the acquisition date. Contingent purchase consideration is recorded at fair value at the date of acquisition. Measuring assets and liabilities at fair value requires us to determine the price that would be paid by a third party market participant based on the highest and best use of the assets or interest acquired. The excess of the purchase price over the fair value of the net assets acquired is recorded as goodwill. The excess of the fair value of the net assets acquired over the purchase price is recorded as a bargain purchase gain. Acquisition costs are expensed as incurred.

WeVariable ~~currently~~Interest doEntities not plan to pay dividends on our common stock. As a result of our Horsehead credit facility entered into on September 28, 2011 (as amended in 2012, 2013 and 2014), our Zochem credit facility entered into on April 29, 2014 and our INMETCO credit facility entered into on June 24, 2013 (as amended in 2014), Horsehead, Zochem and INMETCO are restricted, under certain circumstances, from providing cash to us. These restrictions may limit our ability to pay dividends on our common stock during the terms of these three credit facilities.

InInvestments ~~addition~~in other entities are accounted for using the consolidation, equity or cost basis method depending upon the Company’s ~~indenture~~level ~~governing~~of ~~our~~ownership, ~~10.50%~~ability ~~Senior~~to ~~Secured~~exercise ~~Notes~~significant ~~due~~influence ~~2017~~over the operating and financial policies of the ~~indenture~~investee ~~governing~~and ~~our~~whether ~~9.00%~~the ~~Unsecured~~Company ~~Notes~~is ~~due~~determined ~~2017~~to ~~restrict~~be the ~~declaration~~primary ~~and~~beneficiary ~~payment~~ of ~~dividends~~a variable interest in an entity.

~~Any~~In ~~future~~December ~~determination~~2013, toHMP ~~pay~~entered ~~dividends~~into ~~will~~a ~~depend~~joint ~~upon,~~venture ~~among~~known ~~other~~as ~~factors~~ThirtyOx, ~~our~~LLC ~~results~~(“ThirtyOx”) with Imperial Acquisitions LLC for the acquisition and processing of ~~operations,~~zinc ~~financial~~bearing ~~condition~~secondary materials. The processing operation is located in North Carolina near the Company’s zinc facility in Mooresboro, ~~capital~~North ~~requirements~~Carolina. When the zinc facility resumes operations and if it achieves better production levels than prior to idling, ~~debt~~we ~~covenants~~expect that the majority of the feedstock for the zinc facility will be supplied by Horsehead’s EAF dust recycling plants. ThirtyOx is expected to supply a portion of the incremental zinc feed required by the zinc facility by recovering secondary zinc oxides from the residues generated by galvanizers, ~~contractual~~die ~~restrictions~~casters and ~~any~~ other ~~considerations~~users ~~our~~of ~~board~~zinc ofmetal. ~~directors~~The ~~deems~~ThirtyOx ~~relevant~~facility became operational in August 2014.

~~Securities~~36 ~~Authorized for Issuance under Equity Compensation Plans~~

InformationTable regarding securities authorized for issuance under our equity compensation plans may be found in our Proxy Statement related to the 2015 Annual Meeting of Stockholders and is incorporated herein by reference.Contents

34ThirtyOx was determined to be a variable interest entity as its significant activities are directed by a management agreement and not the equity group. HMP has determined that although it does have influence on ThirtyOx, it is not the primary beneficiary of the variable interest. HMP accounts for its investment in ThirtyOx utilizing the equity method of accounting as it does not own over 50% of the joint venture. HMP has recorded its cash contributions to ThirtyOx as an investment which is increased or decreased by its respective share of ThirtyOx pretax income or loss.

~~Table~~The ofCompany ~~Contents~~has determined that HMP’s interest in ThirtyOx is not individually significant to its consolidated balance sheet and income statement and therefore is not required to provide additional disclosures regarding its involvement with this joint venture.

~~Performance~~Results ~~Graph~~of Operations

The following ~~graph~~table ~~compares~~sets ~~the~~forth ~~sixty month cumulative stockholder return on our common stock with~~ the ~~return~~percentages ~~on the Russell 2000 Index and a Peer Group Index, from January 1, 2010 through December 31, 2014, the end~~ of ~~our~~sales fiscal year. The graph assumes investments of $100 on January 1, 2010 in our common stock, the Russell 2000 Index and the Peer Group Index and assumes the reinvestment of all dividends. Since 2013, a portion of managements long term incentive program is based on the performance of the Company’s total shareholder return over a three year period compared to that ofcertain aitems ~~group~~ of ~~global~~operating ~~metals~~data ~~companies. Based~~constitute onfor ~~this change, management has prepared~~ the ~~performance graph based on the global metals companies which are included in the calculation under the long term incentive program~~periods indicated. ~~The~~ Peer Group is composed of HudBay Minerals, Inc., Nyrstar, Abengoa S.A., Materion Corporation, Quanex Building Products Corporation, Vale S.A., Freeport-McMoRan Copper & Gold Inc., Teck Resources Limited, RTI International, Inc., Hecla Mining Co., Haynes International, Inc. and Glencore Intl. and is weighted by each of their relative market capitalizations at the beginning of each year for which returns are reported.

*$100 invested on 12/31/09 in stock or index, including reinvestment of dividends.


	2015		2014		2013
Net sales		100.0 %		100.0 %		100.0 %
Cost of sales (excluding depreciation and amortization)		106.9		91.2		91.6
(Gain) loss on asset dispositions		(2.7)		0.2		0.2
Impairment loss		127.2		—		2.1
Depreciation and amortization		13.2		7.8		6.7
Selling, general and administrative expenses		6.4		5.3		5.0

Loss from operations		(151.0)		(4.5)		(5.6)
Interest expense		9.5		4.8		0.6
Interest and other income		0.2		3.1		1.4

Loss before income taxes		(160.3)		(6.2)		(4.8)
Income tax provision (benefit)		0.1		(2.8)		(1.6)

Net loss		(160.4)%		(3.4)%		(3.2)%


Loss per common share:
Basic	$	(11.75)	$	(0.30)	$	(0.31)

Diluted	$	(11.75)	$	(0.30)	$	(0.31)

~~Copyright~~A ~~2014~~significant ~~Russell~~portion ~~Investment~~of ~~Group~~our zinc oxide shipments are priced based on prior months’ LME average zinc price. ~~All~~ ~~rights~~Consequently, ~~reserved~~changes in the LME average zinc price are not fully realized until subsequent periods.

Fiscal Year ending December 31	2009	2010	2011	2012	2013	2014
Horsehead Holding Corp.	100	102	71	80	127	124
Russell 2000	100	127	122	141	196	206
Peer Group	100	143	94	93	84	63

The LME average zinc prices for the most recent eight quarters and the average LME zinc prices for the year to date as of the end of each quarter are listed in the table below:

Issuer Purchases of Equity Securities


	2014								2015
Average LME zinc price	March 31		June 30		September 30		December 31		March 31		June 30		September 30		December 31
Quarter	$	0.92	$	0.94	$	1.05	$	1.01	$	0.94	$	0.99	$	0.84	$	0.73
Year-to-date	$	0.92	$	0.93	$	0.97	$	0.98	$	0.94	$	0.97	$	0.92	$	0.87

WeSegment ~~did~~Disclosure ~~not repurchase any of our common stock during the fourth quarter of the fiscal year ended December 31, 2014, and we do not have a formal or publicly announced stock repurchase program.~~

35In anticipation of the April 2014 closure of our Monaca facility, we ceased production of zinc oxide at that facility on December 23, 2013. Since 2014, we only produce zinc oxide at our Zochem facility. Consequently, effective January 1, 2014, Horsehead Corporation and Zochem did not continue to meet the aggregation criteria as required by ASC 280 Segment Reporting and were not combined into one reporting segment.

~~Table~~We currently report three segments, Horsehead, Zochem and INMETCO. The Horsehead segment processes EAF dust and other zinc-bearing material to produce and sell zinc and other metals. The Zochem segment produces and sells zinc oxide. The INMETCO segment processes a variety of ~~Contents~~metal-bearing waste material generated primarily by the specialty steel industry, provides tolling services and produces and sells nickel-chromium-molybdenum-iron to the stainless and specialty steel industries. Accordingly, the 2013 segment information has been reclassified to conform to the new segment presentation.

~~ITEM~~37 ~~6. SELECTED FINANCIAL DATA~~

WeTable have derived the selected historical consolidated financial information as of December 31, 2012, 2011 and 2010 and for the years ended December 31, 2011 and 2010 from our audited consolidated financial statements, which are not included in this Annual Report on Form 10-K. We have derived the selected historical consolidated financial information as of December 31, 2014 and 2013 and for the years ended December 31, 2014, 2013 and 2012 from our audited consolidated financial statements, which are included elsewhere in this Annual Report on Form 10-K. Contents

~~The~~Eliminations ~~selected~~related ~~historical~~to ~~consolidated~~the ~~financial~~exclusion ~~and~~of ~~other~~revenue ~~information~~resulting ~~presented~~from ~~below~~EAF isdust ~~condensed~~service fees ~~and~~charged ~~may~~by ~~not~~our ~~contain~~Horsehead ~~all~~segment ofto ~~the~~our ~~information~~INMETCO ~~that~~segment ~~you~~and ~~should~~sales ~~consider.~~of ~~You~~zinc ~~should~~metal ~~read~~from ~~this~~our ~~information~~Horsehead insegment ~~conjunction~~to ~~with~~ our ~~consolidated~~Zochem ~~financial statements~~segment, ~~including,~~interest ~~where~~expense ~~applicable,~~recorded ~~the~~on ~~related~~debt ~~notes,~~which ~~and~~is ~~the~~not ~~“Management’s~~allocated ~~Discussion~~to ~~and~~our ~~Analysis~~segments ofand ~~Financial~~selling, ~~Condition~~general and ~~Results~~administrative expenses ofrelated ~~Operations”~~to ~~section~~our ~~included~~corporate indivision ~~this~~are ~~Annual~~not ~~Report~~recorded onwithin ~~Form~~our ~~10-K~~three segments.

	Year ended December 31,
	2014			2013			2012			2011			2010
Statements of operations data (1)	( in thousands, except for LME price and per share data)
Net sales	$	453,937		$	441,936		$	435,666		$	451,180		$	382,362
Cost of sales	415,074			414,809			432,557			377,401			305,522
Depreciation and amortization	35,406			29,678			26,193			22,025			18,612
Selling, general and administrative expenses	24,149			22,207			20,882			22,942			18,672
Total costs and expenses	474,629			466,694			479,632			422,368			342,806
(Loss) income from operations	(20,692		)	(24,758		)	(43,966		)	28,812			39,556
Interest expense	(21,680		)	(2,728		)	(7,864		)	(3,324		)	(1,226		)
Gain on bargain purchase of a business	—			—			1,781			4,920			—
Interest and other income	13,942			6,072			2,694			1,948			849
(Loss) income before income taxes	(28,430		)	(21,414		)	(47,355		)	32,356			39,179
Income tax (benefit) provision	(12,974		)	(7,455		)	(16,928		)	10,902			14,409
Net (loss) income	$	(15,456	)	$	(13,959	)	$	(30,427	)	$	21,454		$	24,770
Net (loss) income per share:
Basic	$	(0.30	)	$	(0.31	)	$	(0.69	)	$	0.49		$	0.57
Diluted	$	(0.30	)	$	(0.31	)	$	(0.69	)	$	0.49		$	0.57
Balance sheet data (at end of period)
Cash and cash equivalents	$	30,714		$	136,327		$	244,119		$	188,500		$	109,557
Working capital	48,547			114,334			265,571			260,930			170,120
Property, plant and equipment, net	799,093			708,250			405,222			260,052			218,652
Total assets	973,517			1,005,312			811,828			631,492			496,136
Total long-term debt, less current maturities	406,016			354,768			263,334			79,663			255
Stockholders' equity	434,185			444,894			383,281			412,251			373,010
Cash Flow statement data:
Operating cash flow	$	(40,659	)	$	41,995		$	64,232		$	32,274		$	57,306
Investing cash flow	(110,825		)	(310,007		)	(181,177		)	(51,558		)	(44,134		)
Financing cash flow	45,871			160,220			172,263			98,187			905
Other data:
Tons of zinc product shipped	129			169			189			152			137
Average LME zinc price (2)	$	0.98		$	0.87		$	0.88		$	0.99		$	0.98
Capital expenditures	110,825			311,798			184,541			64,709			44,704
Depreciation and amortization	35,406			29,678			26,193			22,025			18,612

Year Ended December 31, 2015 Compared with Year Ended December 31, 2014

(1)	We acquired HZP on November 16, 2012 for a purchase price of $1,101, and Zochem on November 1, 2011 for a purchase price of $15,078.
(2)	Average LME zinc price equals the average of each closing LME price for zinc on a dollars per pound basis during the measured period.

Consolidated net sales.

36Consolidated net sales decreased $39.0 million, or 8.6%, to $414.9 million for 2015 compared to $453.9 million for 2014.

Table of Contents


Change in consolidated net sales	(in millions)
Horsehead	$	(10.1	)
Zochem		(17.6	)
INMETCO		(6.7	)
Eliminations		(4.6	)
Total change in consolidated net sales	$	(39.0	)

~~ITEM~~See ~~7. MANAGEMENT'S~~separate ~~DISCUSSION~~segment ~~AND~~discussion ~~ANALYSIS~~following. ~~OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS~~

~~You~~Consolidated ~~should~~cost ~~read the following discussion and analysis in conjunction with the other sections~~ of ~~this~~sales ~~Annual~~(excluding ~~Report~~depreciation ~~on Form 10-K, including “Business”~~ and ~~“Selected Financial Data,” as well as our consolidated financial statements, including the notes thereto~~amortization). The statements in this discussion and analysis regarding industry outlook, our expectations regarding our future performance and our liquidity and capital resources and other non-historical statements in this discussion are forward-looking statements. See the “Cautionary Statement Regarding Forward-Looking Statements.” Our actual results may differ materially from those contained in or implied in any forward-looking statements due to numerous risks and uncertainties, including, but not limited to, the risks and uncertainties described in “Risk Factors.”

~~Overview~~Consolidated cost of sales increased $29.5 million, or 7.1% to $443.7 million for 2015 compared to $414.2 million for 2014.

Our History


Change in consolidated cost of sales (excluding depreciation and amortization)	(in millions)
Horsehead	$	48.3
Zochem		(10.6)
INMETCO		(3.6)
Eliminations		(4.6)

Total change in consolidated cost of sales (excluding depreciation and amortization)	$	29.5

WeSee ~~are~~separate asegment ~~leading~~discussion Ufollowing.~~S. producer~~ of zinc metal and our products are used in a wide variety of applications, including in the galvanizing of fabricated steel products and as components in rubber tires, alkaline batteries, paint, chemicals, pharmaceuticals and as a remelt alloy in the production of stainless steel. We believe we are also the largest North American recycler of EAF dust, a hazardous waste produced by the carbon steel mini-mill manufacturing process. Through our Zochem operations, we believe we are the largest single site producer of zinc oxide in North America. Through our INMETCO operations, we believe we are a leading recycler of EAF dust and other nickel-bearing waste generated by specialty steel producers and a leading recycler of nickel-cadmium batteries and other types of batteries in North America. We, together with our predecessors, have been operating in the zinc industry for more than 150 years and in the nickel-bearing waste industry for more than 30 years.

InConsolidated ~~anticipation~~(gain) ofloss ~~the April 2014 closure of our Monaca facility, we ceased production of zinc oxide at that facility~~ on ~~December~~asset ~~23,~~dispositions 2013. During 2014, we only produced zinc oxide at our Zochem facility. Consequently, Horsehead Corporation and Zochem do not continue to meet the aggregation criteria as required by ASC 280 Segment Reporting and have not been combined into one reporting segment effective January 1, 2014. The Company now reports three segments, Horsehead, Zochem and INMETCO.

~~While~~In weJune ~~vary our raw material inputs~~2015, ora ~~feedstock,~~gain ~~based~~of on$12.1 ~~cost~~million ~~and~~related ~~availability,~~to ~~our~~the ~~zinc~~sale ~~products~~of ~~produced at our recently completed new zinc facility in Mooresboro~~land, ~~North~~the ~~Carolina~~site ~~and~~of our ~~nickel-based~~former ~~products~~Monaca ~~at our INMETCO~~ facility ~~use nearly 100% recycled materials~~, ~~including~~was recorded in the Horsehead ~~case~~segment. ~~of our Mooresboro facility~~Additionally, ~~zinc~~during ~~recovered~~2015 ~~from~~and ~~our~~2014, ~~four~~net ~~EAF~~losses ~~dust~~of ~~recycling~~$1.1 ~~operations~~million ~~located~~and ~~in four states~~$0.9 ~~Our~~million, ~~four~~respectively, ~~EAF~~were ~~dust~~recorded ~~recycling~~on ~~facilities~~the ~~also~~disposal ~~generate~~of ~~service~~machinery ~~fee revenue from steel mini-mills by providing a convenient~~ and ~~safe means for recycling their EAF dust~~equipment. WeSee ~~believe~~Footnote ~~that~~F ~~our~~- ~~ability~~Asset toWrite-downs ~~convert~~and ~~recycled~~Disposals ~~zinc into finished products results~~ in ~~lower~~the ~~feed~~Consolidated Financial ~~costs~~Statements ~~than~~ for ~~other~~further ~~zinc producers that rely primarily on zinc concentrates~~information.

WeConsolidated ~~produce~~impairment ~~zinc~~loss oxide at our Brampton, Ontario, Canada facility and utilize special high grade zinc metal as raw material feedstock. INMETCO provides recycling services, some of which is on a tolling basis, from a single production facility in Ellwood City, Pennsylvania.

~~Strategic~~During ~~Investments~~the year ended December 31, 2015, our operations were significantly impacted due to the dramatic decline in zinc, nickel and other commodity prices, continuing issues that delayed the ramp-up of the Mooresboro zinc facility, and lower EAF dust receipts reflecting weaker steel production. Additionally, on January 22, 2016 when we temporarily idled the Mooresboro facility in the face of severe liquidity constraints and our determination that the facility was incapable of generating positive cash flow in the future without significant additional capital investment and/or a recovery in commodity prices, we determined a triggering event occurred related to our Mooresboro facility which required us to assess if the carrying amount of this long-lived asset may not be recoverable. We performed the required first step of the impairment test and determined the carrying amount of our Mooresboro asset group exceeded the sum of the expected undiscounted cash flows. We proceeded to the second step of the impairment test where we were required to determine a fair value for the Mooresboro asset group and recognize an impairment loss if the carrying value exceeded fair value. Fair value of the Mooresboro asset group was determined using i) published prices of our publicly traded debt and equity coupled with ii) the latest twelve months revenue multiples of selected comparable guideline companies to isolate the Mooresboro asset group’s fair value. The income approach was not considered an appropriate fair value measurement due to the absence of reliable forecast data as the facility was idled indefinitely in early 2016 as a result of uncertainty around timing of future

In38 September of 2011, we began construction on a new, state-of-the-art zinc facility located in Mooresboro, North Carolina to replace our Monaca, Pennsylvania facility. We began production at our new zinc facility in May 2014. Our new facility provides us with the capability to produce SHG zinc, CGG zinc and High Grade zinc, in addition to the PW zinc that we produced at our former Monaca, Pennsylvania facility. The first month of operation of our new facility validated that the process as designed, is capable or producing SHG quality electrolyte from WOX using the solvent extraction process. The new facility's design relies upon sustainable manufacturing practices to produce zinc solely from recycled materials and uses significantly less fossil fuel than our former Monaca, Pennsylvania facility, allowing us to significantly reduce emissions of GHGs and particulates into the atmosphere.

Table We believe that the new facility, once fully operational, will provide us with a number of substantial benefits, including reduced manufacturing conversion costs due to the lower energy cost; higher labor productivity; reduced operating maintenance costs; and lower operating costs in our EAF dust recycling plants resulting from the elimination of the need to calcine the majority of our WOX prior to its use. We believe that the new zinc facility's capability to convert WOX and other recycled materials into SHG zinc and other grades will allow us to expand into new markets, including selling to continuous galvanizers, which include some of our EAF dust customers, die casters and potentially LME warehouses, while continuing to serve customers in our existing markets. In addition, the new technology will also allow us to recover value from certain metals such as silver and lead from WOX Contents

37 capital inflows necessary to make required capital improvements to generate positive cash flows stemming from the Chapter 11 proceedings as well as uncertainty around recovery timing of commodity prices. As a result of the impairment test, we recorded a non-cash, pretax long-lived asset impairment loss of $527.6 million for the Mooresboro asset group. The total amount of this write-down is included in Loss from operations in the Consolidated Statement of Operations for the year ended December 31, 2015. Following the write-down of the asset group, the remaining net book value of the Mooresboro asset group was $87.6 million at December 31, 2015. The impairment charge did not impact our business operation or future cash flows nor did it result in any cash expenditures. In assessing the recoverability of our long-lived assets, we are required to make assumptions regarding estimated future cash flows and other factors to determine the fair value of the respective assets. This process is subjective and requires judgment at many points throughout the analysis. If our estimates or their related assumptions change in subsequent periods or if actual cash flows or other market measures are below management’s estimates, we may be required to record impairment charges for these assets not previously recorded or additional impairments on assets already recorded. See Footnote F - Asset Write-downs and Disposals in the Consolidated Financial Statements for further information.

~~Table~~Consolidated ofdepreciation ~~Contents~~and amortization.

~~produced~~Consolidated ~~from~~depreciation ~~EAF dust recycling. We began introducing feed into the lead-silver recovery circuit during the fourth quarter~~ and ~~have~~amortization ~~started~~increased to$19.4 ~~produce~~million, ~~lead-silver~~or ~~concentrate that we are currently analyzing~~ 54.8% to ~~fine tune this circuit~~$54. We8 ~~are~~million ~~also~~for ~~addressing~~2015 ~~some~~compared ~~issues with pump selection identified during the initial operating period. This circuit is expected~~ to ~~be fully operational in approximately twelve months~~$35. ~~The~~4 ~~new~~million ~~zinc~~for ~~facility replaced our zinc smelter in Monaca, Pennsylvania, which was permanently shut down in April~~ 2014. ~~The~~ ~~former Monaca smelter was over eighty years old and utilized a higher-cost pyrometallurgical process.~~

We also believe that additional benefits may be realized once the new facility is fully operational. These additional benefits include a reduction in the cost of hedging the price of zinc, which averaged $9.1 million per year for the period from 2008 to 2013 (the last full year of production at our Monaca, Pennsylvania facility), reduced maintenance capital spending, which averaged $7.8 million per year at our Monaca facility for the period from 2007 to 2012 (the last year significant capital expenditures were made at our Monaca facility) and reduced state income taxes as a result of certain tax incentives available as a result of the investment in the new zinc facility.


Change in consolidated depreciation and amortization	(in millions)
Depreciation associated with the Mooresboro facility		19.0
Other		0.4

Total change in consolidated depreciation and amortization	$	19.4

~~Our~~• new zinc facility currently in the ramp-up stage has experienced operational difficulties that we believe are typical of a start-up of this size which have resulted in production interruptions. Numerous improvements have been made to remediate these issues and improve the ramp-up rate. The primary bottleneck thus far has been the removal of solids at the front end of the process. This is conventional technology used extensively in hydrometallurgical and mining applications, thus we anticipate that this issue will be resolved. We have made progress through better control of the process and improvements in equipment reliability. We have not identified any insurmountable technical or operational obstacles that materially challenge the value proposition of our new zinc facility. However, issues such as the removal of solids described above have slowed the ramp-up rate and delayed the realization of the benefits we believe we can obtain from full operation of our zinc facility. The facility has operated continuously since early August 2014 after a shutdown during the month of July 2014. On January 5, 2015, we reported that the facility produced approximately 12,000 tons of zinc metal in the fourth quarter of 2014 (with approximately 5,400 tons produced in December), compared to approximately 4,300 tons in the third quarter of 2014 and approximately 3,400 tons in the second quarter of 2014. During ~~January~~ 2015, we produced approximately 4,600 tons of zinc metal. We reduced the plating rate for several days in January to perform some needed maintenance in the cell house. We also experienced intermittent equipment reliability issues, particularly with some key pumps, which were further exacerbated by recent extreme cold weather conditions. On February 20, 2015, we began a ~~planned~~full ~~seven~~year ~~day outage to address several~~ of ~~these~~depreciation ~~issues. We~~was ~~expect~~recorded to ramp-up production following this outage. Our interim target is to demonstrate that no bottlenecks exist to operating the facility at 75% of nameplate capacity, or 330 tons per day, by the end of the first quarter of 2015. We believe that our ability to achieve this higher level of production will depend primarily on the ~~absence~~Mooresboro ~~of further unplanned equipment issues. Once fully operational, we expect the new zinc~~ facility towhich bewas ~~capable~~completed ofin ~~producing~~May ~~over 155,000 tons of zinc metal per year with equipment capable of producing over 170,000 tons of zinc metal per year without significant additional investment~~2014. ~~Timing, however, for the completion of the ramp-up to full production cannot be determined with any certainty at this time.~~

InConsolidated ~~connection with the start of operations at our new zinc facility~~selling, wegeneral permanently closed our Monaca, Pennsylvania facility in April 2014. Our Monaca, Pennsylvania facility is under contract to be sold to Shell pursuant to an option to purchase granted in March 2012 that was exercised on November 7, 2014. A large majority of the demolition at the site has been completed at Shell’s expense. We will retain ownership of a non-hazardous captive landfill located at that site and weadministrative are currently in the process of separating our National Pollutant Discharge Elimination System permit into two permits, one to be held by Shell for the portion of the site that would be acquired by Shell and a separate one held by us for our continuing operation of the landfillexpenses.

InConsolidated ~~December 2013~~selling, wegeneral ~~entered~~and ~~into~~administrative aexpenses ~~joint~~increased ~~venture~~$2.5 ~~known~~million, asor ~~ThirtyOx~~10.4% ~~with~~to ~~Imperial Zinc Corp~~$26.6 million for ~~the~~2015 ~~acquisition~~compared to ~~and~~$24.1 ~~processing~~million offor ~~zinc bearing secondary materials~~2014. The ~~processing~~increase ~~operation~~was isprimarily ~~located~~due ~~near~~to ~~our~~an ~~Mooresboro~~increase ~~facility and the facility began production~~ in ~~August~~salaried ~~2014. The~~labor ~~majority~~ of ~~the~~$0.8 ~~feedstock~~million, ~~for~~an ~~Mooresboro~~increase ~~will~~in bemanagement ~~supplied~~stock bycompensation ~~Horsehead's~~expense ~~EAF~~of ~~dust recycling plants~~$0.7 ~~ThirtyOx~~million ~~is expected to supply a portion of the incremental zinc feed required by Mooresboro by recovering secondary zinc oxides from the residues generated by galvanizers, die-casters~~ and ~~other~~an ~~users~~increase of ~~zinc metal~~$1. ~~Our~~3 ~~anticipated~~million ~~total investment~~ in ~~ThirtyOx~~legal ~~is expected to be less than $2.0 million~~ and weprofessional ~~had~~fees ~~contributed~~expense all ~~$0.8~~related ~~million~~to asour ofHorsehead ~~December 31, 2014~~segment.

~~Acquisitions~~Consolidated other income (expense).

OnNet ~~November~~consolidated 1,other ~~2011,~~income we(expense) ~~acquired~~was ~~all of the outstanding shares of Zochem, a zinc oxide producer located in Brampton, Ontario Canada from Hudbay for a cash purchase price of~~ $15(38.13) million. ~~The acquisition broadened the Company’s geographic footprint, provided added operational flexibility and diversified our customers and markets~~ for ~~zinc~~2015 ~~oxide.~~compared ~~In 2012, we announced our plans~~ to ~~expand capacity at the Zochem facility in anticipation of the closure of the zinc oxide refinery at our Monaca, Pennsylvania facility~~$(7. ~~During~~7) ~~the~~million ~~second~~for ~~quarter of~~ 2014,. ~~we completed the expansion and put our seventh and final furnace into~~


Change in consolidated other income (expense)	(in millions)
Increase in actual interest expense	$	(5.7)
Decrease in capitalized interest related to construction of Mooresboro facility		(11.9)
Decrease in interest and other income		(13.0)

Total change in consolidated other income (expense)	$	(30.6)

~~Table~~• Increase in actual interest expense as a result of ~~Contents~~a full year of interest expense related the issuance of $50 million of debt during July 2014 and an overall increase in debt outstanding related to our revolving credit facilities.

~~production.~~• ~~The~~Additional ~~expansion~~interest ~~project~~expense ~~increased~~due ~~the~~to ~~total~~minimal ~~zinc~~capitalization ~~oxide~~of ~~production~~interest ~~capacity~~during at2015 ~~Zochem~~as bya ~~approximately~~result ~~20,000~~of ~~tons~~the tocompletion ~~72,000~~of ~~tons~~the ~~per~~Mooresboro ~~year.~~facility in May 2014.

On• ~~November~~Decrease ~~16,~~in ~~2012, we acquired the single membership~~ interest ~~in Mitsui Zinc Powders LLC ("MZP"), a leading manufacturer of zinc powders for the alkaline battery business~~ and ~~renamed~~other itincome ~~HZP. We~~primarily ~~had~~resulting ~~been~~from a ~~long-term~~decrease ~~supplier~~in ofincome ~~SSHG zinc metal to MZP which was co-located at the site~~ of ~~our former Monaca zinc smelter~~$10. ~~Our~~6 ~~acquisition~~million ofrecorded ~~HZP~~under ~~enabled us to increase our product margins by allowing us to convert our zinc metal into a higher margin zinc powder product for~~ the ~~battery~~Shell ~~market. During~~option ~~the~~contract ~~first~~in ~~quarter~~2015 ofas ~~2014,~~compared ~~HZP production was idled due~~ to ~~a lack of raw material supply and all of out zinc production was consolidated into the Palmerton facility. Shipments, however, continued through the end of April~~ 2014. OnThe ~~November~~sale ~~7, 2014, we announced that Shell had exercised its option under the Amended and Restated Option and Purchase Agreement between Shell and Horsehead Corporation to purchase the site~~ of the Monaca, ~~Pennsylvania~~land ~~facility which included the HZP facility site. The HZP production facility~~ was ~~subsequently~~completed ~~demolished~~in ~~under~~June ~~an agreement with Shell Chemical~~2015.

~~Other~~Consolidated income tax expense (benefit).

On March 15, 2012, we entered into an option agreement with Shell to purchase our Monaca, Pennsylvania site. At the end of December 2013, we entered into an Amended and Restated Option and Purchase Agreement with Shell that included extending the option period during which Shell could perform an evaluation. The amended agreement also provided for demolition activities to commence in 2014 at Shell's expense. Demolition activities at Shell's expense occurred throughout 2014. On November 7, 2014, Shell exercised the option to purchase under the Amended and Restated Option and Purchase Agreement. No closing date has been established.


	2015			2014
Income tax expense (benefit) (in millions)	$	0.3		$	(13.0	)
Effective tax rate		(0.1	)%		45.6	%

On• ~~July 26,~~The ~~2012,~~decrease wein ~~completed~~the a2015 ~~private~~effective ~~placement~~tax rate is due to the uncertainty surrounding the realization of ~~$175.0~~the ~~million~~related ~~principal~~deferred ~~amount~~tax assets in future tax returns, as a result of ~~10.50%~~recent ~~Senior~~history ~~Secured~~of ~~Notes~~net operating losses due ~~2017,~~to ramp up challenges at anthe ~~issue~~Mooresboro ~~price~~facility and softening commodity prices, the Mooresboro facility impairment and the subsequent Chapter 11 bankruptcy filing on February 2, 2016, all of 98the net deferred U.~~188%~~S. oftax ~~par~~assets ~~with~~have been fully offset by a ~~yield~~valuation toallowance ~~maturity~~at ofDecember 1131, 2015.~~00%.~~ The ~~net~~remaining ~~proceeds~~deferred tax liabilities result from our Canadian operations. In 2014, we believed that the ~~offering~~Mooresboro ~~were~~facility ~~approximately~~would ~~$164~~be running at full capacity and therefore the income projections at that time justified no valuation allowance against the federal U.1S. ~~million~~net operating loss carryforwards.

On39 August 28, 2012, we announced that we entered into a credit agreement with a Spanish bank to provide for the financing of up to €18.6 million (approximately $25.8 million USD) for purchases under certain contracts for equipment and related products and services for the new zinc facility and an additional $1.0 million for the insurance premium on this loan.

OnTable September 27, 2012, we formed Horsehead Metal Products, Inc., a wholly owned subsidiary of Horsehead Corporation, which owns and operates our new Mooresboro, North Carolina facility.Contents

OnConsolidated ~~December 21,~~net ~~2012, Zochem entered into the $15~~loss.0 million CAD revolving credit facility (the "Zochem Facility") to support liquidity needs for its production capacity expansion in Brampton, Ontario. On April 29, 2014, we terminated the $15.0 million CAD Zochem Facility and entered into a new $20.0 million revolving credit facility (the "2014 Zochem Facility").

OnNet ~~June 3,~~loss ~~2013,~~for we2015 ~~completed~~was ~~the sale of an additional~~ $20(665.04) million incompared ~~aggregate~~to ~~principal~~a ~~amount~~net ofloss ~~our Senior Secured Notes (the “2013 Additional Notes”) at an issue price~~ of ~~106~~$(15.5%) ofmillion ~~the~~for ~~principal amount~~2014. ~~The 2013 Additional Notes were issued at an effective interest rate of 8.6%. We received net proceeds from the offering of $21.0 million.~~

OnBusiness ~~June 24,~~Segments 2013, INMETCO entered into a $15.0 million revolving credit facility (the "INMETCO Facility") to support working capital requirements and for general corporate purposes. We entered into a guaranty of INMETCO’s obligations under the INMETCO Facility. On March 31, 2014, we entered into the First Amendment to the Credit Agreement, which amended certain provisions of the Credit Agreement, including the increase of the maximum advances allowed to $20.0 million.

On October 30, 2013, we completed an underwritten public offering of 6.3 million shares of common stock, including 0.8 million shares sold pursuant to the underwriters' exercise of their option to purchase additional shares, at a price to the public of $12.00 per share. We received approximately $72.0 million in net proceeds from the offering, after deducting underwriting discounts and commissions and offering expenses.Horsehead

OnNet ~~July 29, 2014, we completed the sale of $40~~sales.0 million aggregate principal amount of 9.00% Unsecured Notes due 2017, at an issue price of 100.00% of par. On July 29, 2014, we also completed the sale of an additional $10.0 million aggregate principal amount of our Senior Secured Notes, at an issue price of 113.00% of par (the "2014 Additional Notes"). The 2014 Additional Notes were issued at an effective interest rate of 5.5%. Total net proceeds from the July 29, 2014 offerings were $49.7 million. At December 31, 2014, there was an aggregate of $205.0 million of Senior Secured Notes outstanding.

39Net sales. Net sales decreased $10.1 million, or 3.9%, to $246.5 million for 2015 from $256.6 million in 2014.

Table of Contents


Change in Horsehead net sales	(in millions)
Increase in fixed rate swap settlements	$	18.3
Volume decrease due to zinc products and services		(9.1)
Price realization decrease relating to zinc products and services		(6.3)
Decrease in WOX/zinc calcine sales		(18.9)
Miscellaneous and other sales increase		1.2
Intercompany transactions relating to the sale of zinc metal to Zochem in 2015		4.7

Total change in Horsehead net sales	$	(10.1)

On• ~~September~~The ~~30,~~decrease ~~2014,~~in ~~Horsehead~~sales ~~Metal~~volume ~~Products,~~primarily ~~Inc.~~related ~~was~~to ~~converted~~reduced toreceipts aof ~~North~~EAF ~~Carolina~~tons ~~limited~~during ~~liability~~2015 ~~company,~~due ~~named "Horsehead~~to ~~Metal~~the ~~Products,~~decrease ~~LLC",~~in ~~and~~capacity ~~The~~utilization ~~International~~of ~~Metals~~the ~~Reclamation~~majority ~~Company,~~of ~~Inc.~~our ~~was~~customers ~~converted~~and tothe decrease in HZP shipments as a ~~Delaware~~result ~~limited~~of ~~liability~~the ~~company,~~shutdown ~~named~~of ~~"The~~the ~~International~~HZP ~~Metals~~facility ~~Reclamation~~in ~~Company,~~early ~~LLC~~2014."

On• ~~January~~The ~~28,~~decrease ~~2015,~~in weprice ~~completed~~realization anwas ~~underwritten~~due ~~public~~to ~~offering~~a ofdecrease ~~5.8~~in ~~million shares of common stock, including 0.8 million shares sold pursuant to~~ the ~~underwriters'~~average ~~exercise~~LME ofzinc ~~their option to purchase additional shares, at a~~ price ~~to the public~~ of ~~$12~~10.759% ~~per~~for ~~share. We~~2015 ~~received~~as ~~approximately~~compared ~~$69.6~~to ~~million in net proceeds from the offering, after deducting underwriting discounts and commissions and offering expenses~~2014.

~~Recent~~• ~~Operating~~Zinc ~~Updates~~fixed ~~and~~rate ~~Outlook~~swaps resulted in cash received of $19.1 million during 2015 as compared to $0.8 million in 2014.

~~Our~~• ~~primary~~WOX ~~focus~~and ~~during~~zinc ~~the~~calcine ~~fourth~~were ~~quarter~~sold ofto ~~2014~~third ~~was~~parties ~~the~~during ~~ramp-up~~2015 ofand ~~the~~2014 ~~Mooresboro~~and ~~facility. The~~will ~~facility~~continue ~~produced approximately 12,000 tons of zinc metal during the quarter compared~~ to ~~4,300~~be ~~tons~~sold in the ~~third quarter of 2014~~future. ~~Production~~ ~~for~~The ~~the~~decrease ~~month~~is oflargely ~~December~~attributable ~~was approximately 5,400 tons as improvements with equipment reliability and process debottlenecking helped~~ to ~~increase~~ the ~~ramp up rate during the quarter~~10.9% ~~For~~decrease ~~extended periods~~ in ~~December,~~ the ~~facility~~average ~~produced~~LME ~~nearly 230 tons of~~ zinc ~~per~~price ~~day,~~in ~~which~~2015. weTons ~~estimate~~shipped isincreased ~~the~~by ~~level of production necessary to generate cash flow sufficient to cover feedstock, conversion cost and cash interest expense~~13. ~~Zinc~~7% ~~metal sales during the fourth quarter of 2014 continued~~ to bepartially ~~supplemented~~offset ~~with~~ the ~~sale~~decline ofin ~~approximately~~price ~~23,500 tons of zinc calcine~~realization.

~~During~~• ~~the~~Net ~~fourth~~sales ~~quarter~~for of2015 ~~2014,~~were wedecreased ~~made~~by ~~significant~~unrealized ~~progress~~non-cash ~~with~~adjustments ~~the previously reported solids/liquid separation issue at the front end~~ of ~~the process, allowing the production rate to increase~~$1.1 ~~Since~~million ~~the~~relating ~~beginning of 2015, the daily average production rate continued~~ to ~~climb~~our ~~compared~~hedging ~~with the fourth quarter 2014 rate~~activities. ~~During~~Net ~~January~~sales ~~2015 we produced approximately 4,600 tons of zinc metal. In January 2015, we reduced production~~ for ~~several~~2014 ~~days to perform some needed maintenance in the cell house. We also experienced intermittent equipment reliability issues, particularly with some key pumps, which~~ were ~~further~~increased ~~exacerbated~~ by ~~recent~~unrealized ~~extreme~~non-cash ~~cold~~adjustments ~~weather conditions. On February 20, 2015, we began a planned seven day outage to address several~~ of ~~these issues~~$1. We2 ~~expect~~million torelating ~~ramp-up production following this outage. Our interim target is~~ to ~~demonstrate that no bottlenecks exist to operating the facility at 75% of nameplate capacity, or 330 tons per day, by the end of the first quarter of 2015. We believe that~~ our ~~ability~~hedging ~~to achieve this higher level of production will depend primarily on the absence of further unplanned equipment issues~~activities. ~~The timing, however, for the completion of the ramp-up to full production cannot be determined with any certainty at this time.~~

We began introducing feed into the lead-silver recovery circuit during the fourth quarter of 2014 and have started to produce lead-silver concentrate that we are currently analyzing to fine tune this circuit. We are also addressing some issues with pump selection identified during the initial operating period.


Horsehead zinc product shipments - in tons	2015		2014
Zinc finished product shipments		59,238		60,991
Calcine/WOX shipments		110,762		97,391
Total zinc product shipments on a zinc contained basis		128,498		124,889
Average sales price realization on a zinc contained basis	$	0.69	$	0.83

WeNet ~~continue~~sales toof ~~believe~~zinc ~~that~~metal wedecreased ~~will~~$7.4 ~~realize~~million, ~~significant~~or ~~benefits~~6.1%, ~~from~~to ~~the~~$113.3 ~~investment~~million infor ~~our~~2015 ~~new~~compared to ~~zinc~~$120.7 ~~facility~~million asfor ~~production ramps-up to full capacity~~2014.

During the fourth quarter of 2014, EAF dust tons processed decreased approximately 4% compared with the third quarter of 2014 while EAF dust received decreased 9.5% over the same period, as reported steel industry capacity utilization decreased from 78.8% to 76.3%. We are seeing signs during the first quarter of 2015 that operating levels in the steel industry are reducing; however, based on available inventory, we expect to operate all of our waelz kilns through the first quarter of 2015. Based upon the expected rate of ramp-up at Mooresboro, we expect to continue to produce zinc calcine from excess waelz oxide during the first quarter. The calcining operation will be shut down when Mooresboro begins to consistently achieve a production capacity utilization level of approximately 75%.


Change in Horsehead zinc metal net sales	(in millions)
Decrease in volume	$	(0.2)
Decrease in price realization		(7.2)

Total change in Horsehead zinc metal net sales	$	(7.4)

At• ~~Zochem,~~The ~~shipment~~decrease ~~volume~~in ~~increased~~price ~~73%~~realization towas a ~~record~~result ~~level~~ of ~~68,000 tons of zinc oxide for~~ the ~~facility~~decrease in ~~2014, reflecting~~ the ~~shift~~average ofprice ~~our~~per ~~Monaca~~ton ~~oxide~~on ~~business~~zinc tometal ~~Zochem~~sold as a result of ~~the~~a ~~closure~~decrease of ~~the~~10.9% ~~Monaca~~in ~~zinc oxide refinery on December 23, 2013 and~~ the ~~completion~~average ofLME ~~Zochem's~~zinc ~~capacity~~price ~~expansion,~~for as2015 ~~the~~versus ~~seventh and final furnace relating to the expansion was put into production during the second quarter of~~ 2014.

~~INMETCO~~40 operated at full capacity during the fourth quarter of 2014 despite the fact that tolling receipts were down 4% compared with the prior year’s fourth quarter reflecting primarily a reduction in output from one customer that was experiencing a production bottleneck. Pig production increased by approximately 8% compared with the fourth quarter of 2013. Nickel prices were up 14% over the fourth quarter of 2013. The annual maintenance outage which had been planned for the fourth quarter of 2014 was deferred until January 2015. It lasted a total of 22 days.

40Table of Contents

~~Table~~Revenues offrom ~~Contents~~EAF dust recycling decreased $4.1 million, or 9.8%, to $37.7 million for 2015 from $41.8 million for 2014.

Demolition of the former Monaca, Pennsylvania site, undertaken pursuant to the agreement with Shell, is expected to be completed during the first quarter of 2015. The water treatment plant is the final structure to be removed.


Change in Horsehead EAF Dust recycling net sales	(in millions)
Decrease in volume	$	(5.0)
Increase in price realization		0.9

Total change in Horsehead EAF Dust recycling net sales	$	(4.1)

~~Factors~~• ~~Affecting~~EAF ~~Our~~dust ~~Operating~~receipts ~~Results~~were 518,420 tons for 2015 compared to 588,996 for 2014. The decrease in volume was due to a decrease in the steel industry capacity utilization.

~~Production~~• ~~Levels~~Increase atin ~~our~~price ~~Mooresboro~~realization ~~Facility. In~~due ~~May~~to ~~2014,~~an weincrease ~~began production of zinc metal at our new zinc facility~~ in ~~Mooresboro. Once fully operational,~~ the ~~facility~~average ~~will~~price ~~be capable of producing over 155,000 tons of zinc metal~~ per ~~year. We~~ton ~~have, however, experienced a number of operational issues associated with the ramp-up of this facility, which produced approximately 12,000 tons of zinc metal during the fourth quarter of 2014~~received. We have worked to address the operational issues we have faced at this facility and continue its ramp-up, but are currently unable to predict with any certainty when we will begin operating at full design capacity. Lower than anticipated production levels at this new facility have negatively impacted our results of operations and have deferred realization of expected benefits.

~~Market~~Cost ~~Price for Zinc and Nickel. We generate the substantial majority~~ of ~~our net~~ sales ~~from~~(excluding ~~the~~depreciation ~~sale of zinc-based products~~ and to a much lesser extent from the sales of nickel-based products, our operating results therefore depend heavily on the prevailing market price for zinc and nickel. Our principal raw materials are zinc extracted from recycled EAF dust, for which we receive revenue from the carbon steel mini-mill companies, and other zinc-bearing secondary materials (“purchased feedstock”amortization) ~~that we purchase from third parties~~. Costs to acquire and recycle EAF dust, are not impacted significantly by fluctuations in the market price of zinc on the LME. Our new zinc facility, which began production in May 2014, also utilizes zinc recycled from EAF dust for a substantial majority of their raw materials. The cost, however, for the remaining portion of our raw materials is directly impacted by changes in the market price of zinc. Our Zochem facility relies entirely on purchased feedstock that is dependent on the LME zinc price. The price of our finished products is impacted directly by changes in the market price of zinc and nickel, which can result in rapid and significant changes in our monthly revenues.

Cost ~~Monthly~~of ~~average~~sales ~~zinc~~increased ~~prices~~$48.3 ~~rose throughout 2005 and 2006~~million, ~~then~~or ~~began a steady decline through 2008~~19.0%, ~~which~~to ~~was particularly sharp in the fourth quarter of 2008~~$302. ~~Monthly~~8 ~~average~~million ~~zinc prices began to gradually strengthen~~ in ~~2009~~2015 ~~and~~from ~~continued to strengthen throughout 2010 and through the first half of 2011~~$254.5 ~~During~~million the second half of 2011, however, the monthly average zinc price began a steady decline which continued through the end of 2011 but then stabilized during 2012 and 2013. The monthly average zinc price began a steady climb during 2014 but dipped slightly in ~~the fourth quarter of~~ 2014.

~~Average~~The ~~monthly,~~cost ~~daily~~of zinc material and ~~yearly~~other ~~LME~~products ~~zinc~~sold ~~prices~~increased ~~for~~$51.7 ~~the~~million, ~~years~~or ~~2005~~23.3%, ~~through~~to ~~2014~~$273.5 ~~were~~million asin ~~follows:~~2015 from $221.8 million in 2014.

LME Zinc Prices	2005			2006		2007		2008		2009		2010		2011		2012		2013		2014
Change in Horsehead cost of zinc material and other products sold		(in millions)
Monthly Average
Production volume decrease of zinc products			(4.4)
High	$	0.83		$	2.00	$	1.74	$	1.14	$	1.08	$	1.10	$	1.12	$	0.93	$	0.97	$	1.06
Increase in cost of zinc products shipped			45.4
Low	$	0.54		$	0.95	$	1.07	$	0.50	$	0.50	$	0.79	$	0.84	$	0.82	$	0.83	$	0.91
Increase in cost of sales relating to WOX and zinc calcine products produced and sold to third parties			6.7
Daily High	$	0.86		$	2.08	$	1.93	$	1.28	$	1.17	$	1.20	$	1.15	$	0.99	$	0.99	$	1.10
Increase in recycling and other costs			4.0
Daily Low	$	0.53		$	0.87	$	1.00	$	0.47	$	0.48	$	0.72	$	0.79	$	0.80	$	0.81	$	0.88
Total change in Horsehead cost of zinc metal and other products sold		$	51.7
Average	$	0.63		$	1.48	$	1.47	$	0.85	$	0.75	$	0.98	$	0.99	$	0.88	$	0.87	$	0.98

We• ~~have~~Due ~~had various types of hedges in place over time~~ to ~~help mitigate~~ the ~~effect~~failure of ~~low zinc prices. During~~ the ~~majority~~Mooresboro ~~of the period that we operated the Monaca, Pennsylvania~~ facility, ~~we purchased put options at a significant cash outlay~~ to ~~prevent~~utilize ~~negative~~all ~~cash~~of ~~flow in~~ the ~~event~~WOX ~~that~~produced ~~the~~by ~~LME zinc price fell below~~ the ~~cost~~recycling ofoperations, ~~our~~some ~~production. While this type~~ of ~~hedge was costly, it allowed us to realize zinc prices higher, but not lower, than~~ the ~~put~~WOX ~~option strike price. As we approached the startup~~ and ~~during the ramp-up of production at the new~~ zinc ~~facility,~~calcine weproduced ~~chose~~by toour ~~enter~~EAF ~~into~~dust ~~fixed~~recycling ~~price~~operations ~~swaps~~were ~~for~~sold short periods of time. These hedges provide certainty of the commodity price for the quantity hedged with no cash outlay when entering into the hedge arrangement. This type of hedge, however, does not allow us to ~~realize~~third ~~higher zinc prices during the brief periods hedged~~parties.

At• ~~December~~Cost ~~31, 2011, we had zinc put options with an $0.85 per pound strike price outstanding, which covered approximately 160,000 tons~~ of ~~zinc~~products ~~production,~~shipped ~~representing~~increased ~~approximately~~due ~~75% of the expected shipments for the period from January 2012 through June 2013. These put options were put in place~~ to ~~provide protection to operating cash flow in~~ the ~~event~~continued ~~that~~ramp-up ~~zinc~~challenges ~~prices~~at ~~decline below that level during~~ the ~~construction~~Mooresboro ~~of the new zinc~~ facility~~. We~~ ~~also~~during ~~had zinc call options with a $1~~2015.~~81 per pound strike price, covering 160,000 tons of zinc production, outstanding at December 31, 2011.~~

At• ~~December~~Inventory ~~31,~~write ~~2012,~~offs weof ~~had~~$0.5 ~~zinc~~million ~~put~~and ~~options with an~~ $03.851 ~~per~~million ~~pound~~were ~~strike~~recorded ~~price~~in ~~outstanding,~~2014 ~~which~~and ~~covered~~2015, ~~approximately 106~~respectively,~~000~~ ~~tons~~related ofto ~~zinc~~the ~~production~~permanent ~~representing~~closure ~~75%~~ of the ~~expected~~Monaca ~~shipments~~facility ~~for~~in ~~the~~April ~~period~~2014 ~~from~~and ~~January~~adjustments ~~2013~~related ~~through~~to ~~December~~supplies ~~2013. During~~inventory ~~2012,~~in ~~we purchased zinc put options, for the second half of 2013 at a cost of $4~~2015.~~9 million. These~~

41• LCM adjustments of $4.4 million and $3.6 million were recorded in 2015 and 2014, respectively. The LCM adjustments were the result of the declining LME zinc price in both years, increased production costs in 2014 at the Monaca facility as the plant operated at inefficient levels during shutdown and the incurrence of higher than normal production costs in 2014 and 2015 as the Mooresboro facility operated at inefficient levels during startup.

~~Table~~Conversion costs for the Mooresboro facility, which began production in May 2014, were $92.9 million and $42.7 million for 2015 and 2014, respectively, and consisted primarily of ~~Contents~~labor, maintenance, services, utilities, supplies and chemical additives. Conversion costs for the Monaca facility, which closed at the end of April 2014, were $32.6 million for 2014.

~~put~~Conversion ~~options~~costs ~~were~~for ~~put in place to provide protection to operating cash flow in~~ the ~~event~~recycling ~~that~~facilities ~~zinc prices decline below~~ that ~~level~~process ~~during~~EAF ~~the~~dust ~~completion~~increased of$2.4 ~~construction~~million, ofor ~~the new zinc facility~~2.6%, Weto ~~also had zinc call options with a~~ $194.810 ~~per~~million ~~pound~~in ~~strike~~2015 from ~~price outstanding but their value was negligible at December 31, 2012~~$91.6 ~~The~~million ~~remaining~~in ~~zinc call options expired during the six months ended June 30, 2013~~2014.

During the first quarter of 2013, the Company purchased put options, with an $0.85 per pound strike price, for the first quarter of 2014 that covered approximately 13,200 tons of production at a cost of $0.8 million. These put options were put in place to provide protection to operating cash flow in the event that zinc prices decline below that level during the completion of construction and start up of the new zinc facility. During August 2013, the Company put in place equivalent $0.85 per pound strike price put options covering an additional 4,400 tons per month of zinc production for the period of January 2014 through March 2014 and converted $0.85 per pound strike price put options covering 5,000 tons per month of zinc production from October 2013 through March 2014 to fixed price swap contracts for the same period at an average price of approximately $0.903 per pound. We converted a portion of the put options into swaps in order to reduce the effect of changes in the zinc price on cash flow during the period of planned transition of operations to the new zinc facility. The sale of the put options resulted in a $1.3 million cash benefit, and the Company was able to put the swaps in place without any additional payment. In December 2013, we entered into additional fixed price swap contracts for the first quarter of 2014 at an average price of approximately $0.90 per pound. These swaps were transacted without any payment by us.


Change in Horsehead recycling conversion costs	(in millions)
Services	$	1.4
Coke		0.7
Labor		0.7
Maintenance related costs		2.1
Natural gas		(2.4)
Other		(0.1)

Total change in Horsehead recycling conversion costs	$	2.4

At• ~~December 31,~~Conversion ~~2013,~~costs ~~the~~reflect ~~total quantity covered under forward fixed price swaps was 26,600 tons and the total quantity covered under put options was approximately 11,600 tons at~~ a ~~strike price of $0~~3.856% ~~per~~decrease ~~pound.~~in ~~All~~production ~~quantities~~levels ~~covered~~due ~~related~~ to the ~~first~~ramp-up ~~quarter~~ of ~~2014~~production ~~and~~at ~~no forward fixed price swaps nor put options were in place beyond~~ the ~~first~~Mooresboro ~~quarter~~facility ~~of 2014. In late July~~ and ~~early August 2014, we added zinc fixed price swaps for the months of August and September 2014, at an average price of slightly over $1.07 per pound for~~ a ~~total~~decrease ~~quantity~~in ~~covered~~EAF ofdust ~~6,000 tons per month~~receipts. In ~~October~~The ~~and~~decrease ~~early~~in ~~November~~receipts ~~2014,~~was wedue ~~added~~to ~~zinc fixed price swaps for the months of November and December 2014, at an average price of slightly over $1.05 per pound for~~ a ~~total~~decrease ~~quantity covered of 6,600 tons per month. These fixed rate swaps were put~~ in ~~place to reduce volatility during~~ the ~~continued~~steel ~~ramp~~industry upcapacity ~~of production at the new zinc facility~~utilization.

The ~~put~~cost ~~options~~of ~~settled~~EAF ~~monthly~~dust onservices andecreased ~~average LME pricing basis~~$4.4 ~~During the year ended December 31~~million, ~~2014,~~or ~~the average LME monthly zinc prices for first three months of 2014 were higher than the strike price for the contracts and we received no settlement payment~~13. ~~During the year ended December 31~~1%, ~~2013,~~to ~~the average LME monthly zinc prices for six of the twelve months were lower than the strike price for the contracts and we received a total of~~ $129.43 million. ~~During the year ended December 31, 2012, the average LME monthly zinc prices~~ for ~~three~~2015 offrom ~~the twelve months were lower than the strike price for the contracts and we received a total of~~ $033.87 million for 2014.

We received $0.7 million and $1.1 million, respectively, from the settlement of fixed price swaps during the years ended December 31, 2014 and 2013. We did not have any fixed price swaps in place during 2012.


Change in Horsehead cost of EAF dust services	(in millions)
Decrease due to volume	$	(4.0)
Decrease in transportation costs		(0.4)

Total change in Horsehead cost of EAF dust services	$	(4.4)

At• ~~December 31,~~EAF ~~2014,~~dust wereceipt ~~had~~tons nodecreased ~~remaining~~12.0% ~~put~~for ~~options~~2015 ~~nor~~compared ~~fixed~~to ~~price~~2014. ~~swaps~~The decrease in ~~place~~volume was due to a decrease in the steel industry capacity utilization.

~~During~~41 the first quarter of 2015, we added zinc fixed price swaps for the month of February 2015, at an average price of approximately $0.97 per pound for a total quantity covered of approximately 3,300 tons for the month.

DailyTable high,of low and yearly average LME nickel prices for the years 2010 through 2014 were as follows:Contents

LME Nickel Prices	2010		2011		2012		2013		2014
Daily High	$	11.81	$	13.17	$	9.90	$	8.44	$	9.62
Daily Low	$	8.36	$	7.68	$	6.89	$	5.97	$	6.06
Average	$	9.89	$	10.36	$	7.97	$	6.81	$	7.65

Zochem

~~Demand~~Net ~~for Zinc and Nickel-Based Products~~sales. We generate revenue from the sale of zinc metal, zinc oxide and nickel-based products and services, as well as from the collection and recycling of EAF dust. Demand for our products and services decreased significantly in the fourth quarter of 2008 due to the severe economic slowdown and continued into the first quarter of 2009. Demand for our products, however, began to increase during the second quarter of 2009 and continued to increase through 2012, as our smelting facility and recycling plants operated at near-capacity during 2012, reflecting some increase in market share and some strengthening of underlying market demand. During 2013, we elected to reduce shipments of zinc products in order to build inventory to support customer demand during the transition of metal and oxide production from Monaca to North Carolina and Zochem. At the end of 2013, we began to ship some of the inventory that we had been building during 2013. Our zinc equivalent production of zinc products at our Monaca, Pennsylvania facility, which permanently closed in April 2014, and our

42Net sales decreased $17.6 million, or 12.2%, to $127.1 million in 2015 from $144.7 million in 2014.

Table of Contents


Change in Zochem net sales	(in millions)
Lower shipment volume	$	(12.7)
Decrease in price realization		(4.9)

Total change in Zochem net sales	$	(17.6)

~~new~~• ~~zinc~~Lower ~~facility~~shipment involume ~~Mooresboro,~~due ~~North~~to ~~Carolina,~~a ~~which~~decrease ~~began production~~ in ~~May~~tons ~~2014,~~shipped ~~was~~of ~~50,000~~8.8% ~~tons~~ for ~~2014~~2015 as compared to ~~125,000 and 146,000 tons in 2013 and 2012, respectively~~2014.

~~Weekly~~• ~~steel~~Decrease ~~industry~~in ~~capacity~~price ~~utilization~~realization ~~continued~~resulted ~~the general upward trend~~ from ~~2010~~a ~~through the second quarter of 2012, remaining in the mid 70~~10.9% ~~range~~lower ~~throughout~~LME ~~that~~average ~~period,~~zinc ~~thereby~~price ~~increasing the amount of EAF dust generated and the demand~~ for ~~our~~2015 ~~EAF~~as ~~dust~~compared recycling services. We began operations at the first kiln at our Barnwell, South Carolina facility in April of 2010 and the second kiln in September of 2010. During the third quarter of 2012, weekly steel industry capacity began to ~~decline and dipped in the fourth quarter of 2012 to its lowest quarterly level since 2010. During 2013 and~~ 2014~~, weekly steel industry capacity increased back to the mid to high 70% range~~.

~~The~~• ~~table~~Non-cash ~~below~~adjustments ~~illustrates~~related ~~historical~~to ~~sales~~our ~~volumes~~hedging ~~and~~activities ~~revenues~~were ~~for~~not ~~zinc~~material ~~and~~for ~~nickel-based~~both ~~products~~2015 and ~~EAF dust:~~2014.

	Shipments/EAF Dust Receipts			Revenue/Ton
	2014	2013	2012	2014		2013		2012
Product:	(Tons, in thousands)			(In U.S. dollars)
Zinc Products (1)	129	169	189	$	2,125	$	1,966	$	1,870
EAF Dust	580	607	618	$	70	$	72	$	69
Nickel-based products	29	28	28	$	1,677	$	1,568	$	1,717

Cost of sales (excluding depreciation and amortization).

~~(1)~~Cost ~~Includes~~of ~~HZP~~sales ~~from~~decreased ~~November~~$10.6 16million, ~~2012~~or ~~until~~8.4%, ~~production~~to ~~ceased~~$116.2 ~~during~~million ~~the~~in ~~first~~2015 ~~quarter~~from of$126.8 million in 2014.

Cost of Sales (excluding depreciation and amortization). Our cost of producing zinc and nickel products consists principally of purchased feedstock, energy, maintenance and labor costs. Purchased feedstock related costs are driven by the percentage of purchased feed used in the feed mix, the average LME zinc price and the price paid for the purchased feed expressed as a percentage of the LME average zinc price. Purchased feedstock sells at a discount to the LME price of zinc.


Change in Zochem cost of sales	(in millions)
Decrease in cost of products shipped	$	(11.1)
Decrease in price realization		(0.5)
Hedge settlements		1.0

Total change in Zochem cost of sales	$	(10.6)

~~Purchased~~• ~~feedstock~~Shipment ~~costs~~volume atdecreased ~~our Zochem facility, which comprised 84~~8.8% ofin ~~production~~2015 ~~costs,~~as ~~consisted~~compared ~~entirely~~to of2014 ~~purchased~~which ~~SHG~~resulted ~~zinc~~in ~~metal. The~~a ~~price~~total ofdecrease ~~these~~in ~~metal blocks is based on~~ the ~~LME~~cost ~~zinc price. Conversion related costs represented 16%~~ of ~~our~~products ~~2014 production costs at our Zochem facility~~shipped.

~~Certain~~• ~~components~~Decrease ~~of our conversion costs do not change proportionally with changes~~ in ~~production~~price ~~volume. Consequently,~~realization asresulted ~~volume~~from ~~changes,~~ a ~~portion of our conversion cost per ton changes inversely~~10. ~~Other~~9% ~~components~~lower ofLME ~~cost~~average ofzinc ~~sales~~price ~~include~~for ~~transportation~~2015 ~~costs,~~ as ~~well~~compared as other manufacturing expenses. The main factors that influence our cost of sales as a percentage of net sales are fluctuations in zinc and nickel prices, production and shipment volumes, efficiencies, energy costs and our ability to ~~implement cost control measures aimed at improving productivity~~2014.

WeIncome ~~value~~before ~~the~~income ~~majority of our inventories using the weighted average actual cost method~~taxes. ~~Under~~ this method, the cost of our purchased feedstock generally takes three to four months to flow through our cost of sales. In an environment of declining LME average zinc prices, our inventory cost can exceed the market value of our finished goods. As a result, lower-of-cost-or-market (“LCM”) adjustments can occur. During 2014, 2013 and 2012, we recorded LCM adjustments of $3.6 million, $3.7 million and $1.4 million, respectively. Zochem values its inventory using the first in-first out method and therefore the majority of the cost of its purchased feedstock generally flows through cost of sales during the same month it is purchased.

~~Selling,~~For ~~General~~the ~~and~~reasons ~~Administrative~~stated ~~Expenses. Our selling~~above, ~~general~~Zochem’s ~~and~~income ~~administrative~~before ~~expenses~~income ~~consist~~taxes ofwas ~~all~~$5.6 ~~sales~~million ~~and marketing expenditures, as well as administrative overhead costs, such as salary and benefit costs~~ for ~~sales~~2015 ~~personnel~~compared ~~and administrative staff, expenses related~~ to the use and maintenance of administrative offices, costs associated with acquisitions, other administrative expenses, including expenses relating to logistics and information systems and legal and accounting expense, and other selling expenses, including travel costs$13.6 ~~Salary~~million ~~and benefit costs historically have comprised the largest single component of our selling, general and administrative expenses~~for 2014. ~~Selling,~~ ~~general and administrative expenses as a percent of net sales historically have been impacted by changes in salary and benefit costs, as well as by changes in selling prices.~~

~~Fire at our~~ INMETCO ~~facility on October 28, 2012~~

~~On October 28, 2012, a fire occurred at the Company’s INMETCO facility~~Net sales. As INMETCO began its annual maintenance shutdown of the rotary hearth furnace and the submerged arc furnace, they experienced an unrelated fire in the material preparation and blending section of the plant, incurring damage to that portion of the building. The planned maintenance outage was only extended a day as a result of delays caused by the fire but we were not able to operate at full capacity until mid-December 2012

43Net sales decreased $6.7 million, or 12.4%, to $47.4 million in 2015 from $54.1 million in 2014.

Table of Contents


Change in INMETCO net sales	(in millions)
Increase in shipment volume	$	2.6
Decrease in price realization		(9.2)
Other and miscellaneous sales		(0.1)

Total change in INMETCO net sales	$	(6.7)

~~because~~• ~~power~~Lower ~~was~~price ~~not~~realization ~~fully~~resulted ~~restored~~from toa ~~some~~30.0% ~~ancillary~~lower ~~operations~~LME average nickel price and customer mix on tolling return shipments. ~~All~~2014 ofincluded ~~the~~$1.5 ~~repairs~~million ~~were~~unfavorable ~~substantially~~adjustments ~~complete~~related byto ~~the~~nickel ~~end~~hedge ofsettlements ~~the~~as ~~first~~opposed ~~quarter~~to of$0.2 ~~2013~~million in unfavorable adjustments related to nickel hedge settlements in 2015.

~~The~~42 damages from the fire exceeded our insurance deductible of $0.5 million and an estimated claim of $4.9 million was submitted for property damage insurance recovery. We reached a final settlement in the amount of $4.0 million during the second quarter of 2013. As of December 2013, the entire insurance recovery of $4.0 million had been received in cash.

SeeTable Footnoteof DD - Insurance Recoveries in our Audited Consolidated Financial Statements for further information.Contents

~~Trends~~Cost ~~Affecting~~of ~~Our~~sales ~~Business~~(excluding depreciation and amortization).

~~Our~~Cost ~~operating~~of ~~results~~sales ~~are~~decreased ~~and~~$3.6 ~~will~~million, beor ~~influenced~~10.5%, byto a$30.6 ~~variety~~million ofin ~~factors,~~2015 ~~including:~~from $34.2 million in 2014.

•production levels at our facilities;


Change in INMETCO cost of sales (excluding depreciation and amortization)	(in millions)
Decrease in cost of products shipped	$	(3.2)
Higher shipment volume		1.6
Net insurance benefit		(1.7)
Other		(0.3)

Total change in INMETCO cost of sales (excluding depreciation and amortization)	$	(3.6)

•~~the~~ ~~supply~~Decrease in cost of ~~EAF~~products ~~dust~~shipped ~~for~~was ~~our~~due ~~recycling~~to ~~operations;~~lower purchased raw material costs and a reduction in incentive program costs.

•~~LME~~ ~~price~~Net insurance benefits of ~~zinc~~$1.7 ~~and~~million ~~nickel;~~related to a fire at the INMETCO facility in November 2015.

~~•changes~~Other ~~in cost of energy and fuels;~~

~~•gain~~Corporate, eliminations and ~~loss~~other ~~of customers;~~

•Net ~~pricing~~sales. ~~pressures from competitors, including new entrants into the zinc product markets, or the EAF dust or nickel-bearing waste recycling markets;~~

~~•production~~Eliminations ~~levels~~of innet sales were $6.0 million for 2015 and $1.4 million for 2014. Eliminations relate to the ~~domestic~~exclusion ~~steel~~of revenue ~~industry;~~resulting from EAF dust service fees charged by our Horsehead segment to our INMETCO segment during 2015 and 2014 and the sale of zinc products from our Horsehead segment to our Zochem segment during 2015.

~~•increases~~Loss ~~and~~before ~~decreases~~income intaxes. ~~the use of zinc and nickel-based products;~~

~~•expansions~~Loss ~~into~~before ~~new~~income ~~products~~taxes ~~and~~increased ~~expansion~~$14.0 ofmillion ~~our~~to ~~capacity,~~$32.7 ~~which~~million ~~requires~~for us2015 compared to ~~incur~~$18.7 ~~costs~~million ~~prior~~for 2014. The increase was primarily due to ~~generating~~a ~~revenues;~~decrease in capitalized interest of $11.3 million resulting from the completion of construction of the Mooresboro facility in May 2014 and an increase in actual interest expense of $3.1 million as a result of a full year of interest expense related the issuance of $50 million of debt during July 2014 which was recorded in our corporate division.

~~•expenditures~~Year ~~required~~Ended December 31, to2014 ~~comply~~Compared with ~~environmental~~Year ~~and~~Ended ~~other~~December 31, ~~operational~~2013 ~~regulations;~~

~~•access~~Consolidated tonet ~~credit~~sales. ~~by our customers; and~~

~~•our~~Consolidated ~~operational~~net ~~efficiency~~sales ~~improvement~~increased ~~programs~~$12.0 million, or 2.7%, to $453.9 million for 2014 compared to $441.9 million for 2013.

We have experienced fluctuations in our sales and operating profits in recent years due to fluctuations in zinc, energy and fuel prices. Historically, zinc prices have been extremely volatile, and we expect that volatility to continue. Changes in zinc pricing have impacted our sales revenues since the prices of the products we sell are based primarily on LME zinc prices, and they have impacted our costs of production, since the purchase prices of some of our feedstocks are based on LME zinc prices. Therefore, since a large portion of our sales and a portion of our costs are affected by the LME zinc price, we expect that changing zinc prices will continue to impact our operations and financial results in the future and any significant drop in zinc prices will negatively impact our results of operations.


Change in consolidated net sales	(in millions)
Horsehead	$	(55.3)
Zochem		66.4
INMETCO		0.5
Eliminations		0.4

Total change in consolidated net sales	$	12.0

~~Energy~~See isseparate ~~one~~segment ofdiscussion ~~our most significant costs~~following. ~~Our~~ processes rely on electricity, coke and natural gas to operate. Our freight operations depend heavily on diesel fuel. Energy prices, particularly for coke and diesel fuel, have been volatile in recent years and currently exceed long-term historical averages. These fluctuations impact our manufacturing costs and contribute to earnings volatility.

~~Our~~43 zinc based products compete with other materials in many of their applications. For example, PW zinc is used by steel fabricators in the hot dip galvanizing process, in which steel is coated with zinc in order to protect it from corrosion. Steel fabricators can also use paint, which we do not sell, for corrosion protection. Demand for our zinc as a galvanizing material may shift depending on how customers view the respective merits of hot dip galvanizing and paint. In addition, SHG zinc and CGG zinc are used by continuous galvanizers to produce galvanized flat-rolled sheet steel for the automotive market. There have been recent plans by some automotive companies to begin to use light weight aluminum sheet to replace galvanized steel. Any such shifts in industry uses could affect our sales.

OurTable nickel-based products are used in the stainless steel industry. Demand for our products and services may decline if demand for stainless steel lessens. Nickel-bearing stainless steel faces competition from stainless steel containing a lower level of nickel or no nickel. Contents

~~Our~~Consolidated ~~ability~~cost to anticipate shifts in product usage and to produce new products to meet our current and future customers’ needs will significantly impact our operating results. We also face intense competition from regional, national and global providers of ~~zinc~~sales ~~and~~(excluding ~~nickel~~depreciation ~~based products,~~ and ~~the growth of any of those competitors could reduce our market share and negatively impact our operating results~~amortization).

~~Our~~Consolidated ~~business~~cost ~~is subject to a wide variety~~ of ~~environmental~~sales ~~and~~increased ~~other~~$9.4 ~~regulations~~million, ~~and~~or ~~our~~2.3%, ~~operations expose us~~ to ~~a wide variety of potential liabilities~~$414.2 ~~Our~~million ~~total~~for ~~cost~~2014 ofcompared ~~environmental~~to ~~compliance~~$404.8 atmillion ~~any~~for ~~time depends on a variety of regulatory, technical~~ 2013.


Change in consolidated cost of sales (excluding depreciation and amortization)	(in millions)
Horsehead	$	(49.4)
Zochem		59.5
INMETCO		(1.2)
Eliminations		0.5

Total change in consol

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