RUDNICK & WOLFEAs filed with the Securities and Exchange Commission on December 15, 2006
Registration No. 333-_____
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
MFRI, INC.
(Exact name of registrant as specified in its charter)
Delaware | 36-3922969 | ||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) | ||||
7720 Lehigh Avenue
Niles, Illinois 60714
(847) 966-1000
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
Mr. David Unger
Chairman of the Board of Directors
MFRI, Inc.
7720 Lehigh Avenue
Niles, Illinois 60714
(847) 966-1000
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copy to:
Hal M. Brown, Esq.
DLA Piper US LLP
203 North LaSalle Street, Suite 1800
1900
Chicago, ILIllinois 60601
May 2, 1997
(312) 368-2109
VIA EDGAR368-4012
Approximate date of commencement of proposed sale to the public: From time to time after this registration statement becomes effective.
If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [ X ]
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]
If this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. [ ]
If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. [ ]
CALCULATION OF REGISTRATION FEE
Title of each class | Amount to be registered | Proposed maximum offering price per unit(1) | Proposed maximum aggregate offering price (1) | Amount of registration |
Common Stock, par value, $0.01 per share | 1,500,000 shs. | $22.02 | $33,030,000 | $3,535 |
(1) | Estimated solely for the purpose of computing the registration fee in accordance with Rule 457(c) based on the average of the high and low reported sales prices on the NASDAQ Global Market on December 11, 2006. |
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.
The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement relating to these securities has been declared effective by the Securities and Exchange Commission. This prospectus is neither an offer to sell nor a solicitation of an offer to buy these securities in any jurisdiction where such offer or sale is unlawful.
Subject to Completion
Dated _______, 2006
PROSPECTUS
1,500,000 Shares
MFRI, INC.
Common Stock
This prospectus relates to the offer and sale from time to time of 1,500,000 shares of common stock of MFRI, Inc., a Delaware corporation (the “Company”), par value $0.01 per share (“Common Shares”) by the Company.
The Common Shares are listed on the NASDAQ Global Market under the symbol “MFRI”.
Investing in our securities involves risk. Before buying our securities, you should read and consider the risk factors included in our periodic reports and in other information that we file with the Securities and Exchange Commission. See “Special Note Regarding Forward-Looking Statements.”
Neither the Securities and Exchange Commission 450 5th Street, N. W.
Washington, D. C. 20549
Re: MFRI, INC.
ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED JANUARY 31, 1996
FILE NO. 0-18370
REGISTRATION STATEMENT ON FORM S-3
FILE NO. 333-21951
Ladies and Gentlemen:
Attached, for filing,nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a conformed copycriminal offense.
The date of Amendment No. 1this prospectus is ___________, 200_.
TABLE OF CONTENTS
Page | ||
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS | 3 | |
AVAILABLE INFORMATION | 3 | |
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE | 3 | |
THE COMPANY | 4 | |
USE OF PROCEEDS | 4 | |
PLAN OF DISTRIBUTION | 4 | |
EXPERTS | 5 | |
LEGAL MATTERS | 5 | |
No dealer, salesperson or other individual has been authorized to Registration Statement No. 333-21951 on Form S-3, including exhibits
thereto, with respectgive any information or to shares of common stock, par value $. 01 per share,
of MFRI, Inc. (the "Company"), that were issuedmake any representations not contained or incorporated by reference in this prospectus in connection with the mergeroffering covered by this prospectus. If given or made, such information or representations must not be relied upon as having been authorized by us. This prospectus does not constitute an offer to sell, or a solicitation of Midwesco, Inc. ("Midwesco") with and intoan offer to buy, the Company.
The changesCommon Shares, in Amendment No. 1 include: (i) changesany jurisdiction where, or to any person to whom, it is unlawful to make any such offer or solicitation. Neither the delivery of this prospectus nor any offer or sale made in response to
the staff's letter of comment dated March 20, 1997 (as discussed below);
and (ii) minor editorial efforts and corrections.
The responses herein are numbered consecutively to correspond to the
commentshereunder shall, under any circumstances, create an implication that there has not been any change in the staff's letter.
THE COMPANY, PAGE 3
1. The Company's Annual Report on Form 10-K forfacts set forth in this prospectus or in our affairs since the fiscal year ended
January 31, 1997 ("1997 Form 10-K Report"), which isdate hereof.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Information contained in or incorporated by reference into this prospectus and any accompanying prospectus supplement contains “forward-looking statements” within the Registration Statement, includes a discussionmeaning of the
business of Thermal Care.
SELLING STOCKHOLDERS, PAGE 5
2. The Registration Statement has been revised as requested.
3. The Registration Statement has been revised as requested.
PLAN OF DISTRIBUTION, PAGE 7
4. The Registration Statement has not been revised, in accordance with
telephone conversations between the undersigned and Mr. Mark Webb of the
staff.
INFORMATION INCORPORATED BY REFERENCE, PAGE 7
5. The Registration Statement has been amended as requested.
6. As discussed by the undersigned and Mr. Webb, the Registration Statement
incorporates the Company's Current Report on Form 8-K dated December 30,
1996, as required by Item 12 of Form S-3. However, no information
incorporated therein has been incorporated by reference into the
Registration Statement.
EXPERTS
7. The Registration Statement has been revised to reflect the filing of the
1997 Form 10-K Report. See the responses to questions 10 and 11 below.
INFORMATION INCORPORATED BY REFERENCE
8. The Registration Statement has been revised as requested.
GENERAL
9. A consent for the use of the audit report contained in the 1997
Form 10-K Report has been included in the Registration Statement.
10. The Registration Statement has been amended to incorporate by reference
the financial statements of the Company as of and for the year ended
January 31, 1997 included in the 1997 Form 10-K Report.
11. The financial statements of the Company included in the 1997 Form 10-K
Report include updated pro forma financial information with respect to the
Company's December 30, 1996 acquisition of Midwesco. Midwesco merged with
and into the Company and through such merger, Midwesco's accounts are
included in the consolidated financial statements of the Company since the
date of acquisition in accordance with APB No. 16. Management of the
Company does not believe that the separate historic interim or prior year
financial statements of Midwesco, after the consummation of the transaction
and the merger of Midwesco into the Company, would be meaningful to the
readers of its financial statements at this time.
12. Midwesco Management believes that, as a privately held entity, the
"segmentation" provisions of APB 30 do not apply to Midwesco. The spin off
of certain operations of Midwesco was contingent upon approval of the
acquisition of Midwesco by the stockholders of the Company; thus, no
"measurement date" under paragraph 14 of APB 30 had been reached.
Management does not believe that restatement of Midwesco's historic interim
or prior year financial statements, after the consummation of the
transaction and the merger of Midwesco into the Company, would be
meaningful to the readers of its financial statements at this time.
13. Because the fiscal 1994 consolidated statement of operations is not
included in the 1997 Form 10-K Report, management does not believe it is
meaningful at this point to amend the disclosure in the earlier year's
Form 10-K. Management believes that the comparisons made in the referenced
Form 10-K/A1 are meaningful given their pro forma nature.
14. The following reconciles the changes in the balance sheet accumulated
depreciation and amortization to the cash flow provision for depreciation
and amortization, for the year ended January 31, 1996 in $000's:
AVAILABLE INFORMATION
The Company is
We are subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"“Exchange Act”), and, in accordance therewith, files periodicwe are required to file reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission"“Commission”). SuchYou may read and copy these reports, proxy statements and other information can be inspected and copied
at the public reference facilities maintained by the Commission atPublic Reference Room
1024, 450 Fifth Street, N. W., Washington, D. C. 20549, and should also be
available for inspection and copying at the regional offices of the Commission, located at 75 Park Place, 14th Floor, New York, New York 10007
and 500 West Madison100 F Street, Suite 1400, Chicago, Illinois 60661. Copies
of such material can also be obtained from the Public Reference Section of
the Commission at 450 Fifth Street, N. W.N.E., Washington, D. C. 20549 at
prescribed rates. The Commission maintains a Web site that containsD.C. 20549. You may also obtain copies of the reports, proxy and information statements and other information aboutregarding issuers that file electronically with the Company. The address ofCommission by accessing the Commission's World Wide Web site maintained byat http://www.sec.gov. You may obtain information on the Commission is
"http://www. sec. gov".
This Prospectus constitutes a partoperation of a registration statement on Form S-3
(herein, together with all amendments and exhibits, the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities
Act"), filed by the Company. This Prospectus does not contain all of the
information set forth in the Registration Statement. For further
information, reference is hereby made to the Registration Statement,
including the financial schedules and exhibits filed or incorporated by
reference as a part thereof, which may be -examined at the Public Reference Room by calling the Commission at 1-800-SEC-0330.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
We have filed the documents listed below with the Commission under the Exchange Act and these documents are incorporated into this prospectus by reference:
a. | Annual Report on Form 10-K for the year ended January 31, 2006. |
b. | Quarterly Reports on Form 10-Q for the periods ended April 30, 2006, July 31, 2006, and October 31, 2006. |
c. | Current Reports on Form 8-K filed on April 20, 2006, June 30, 2006, September 21, 2006, October 18, 2006, and November 6, 2006. |
d. | Description of our common shares contained in the registration statement of our predecessor on Form 8-A filed on March 13, 1990. |
All documents filed by us pursuant to Sections 13(a), 13(c), 14 and 15(d) of the CommissionExchange Act after the date of this prospectus and prior to the termination of the offering of all Common Shares under this prospectus will also be deemed to be incorporated by reference in Washington, D. C., without charge, or copies of
which maythis prospectus and to be obtaineda part hereof from the Commission upon paymentdate of filing those documents.
Any statement contained in this prospectus or in a document incorporated or deemed to be incorporated by reference herein will be modified or superseded by inconsistent statements in any document we file in the prescribed
fees. Statements containedfuture that will be deemed incorporated by reference herein, concerningincluding any prospectus supplement that supplements this prospectus. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus or any accompanying prospectus supplement. Subject to the provisions of documents
filed herewith as exhibits are necessarily summaries of such documents,foregoing, all information appearing in this prospectus and each such statementaccompanying prospectus supplement is qualified in its entirety by reference to the copy
of the applicable document filed with the Commission.
RISK FACTORS
COMPETITION; BUSINESS. The businesses in which the Company is engaged are
highly competitive. In addition, new installations of baghouses are
subject to competition from alternative technologies and the sale of
specialty piping systems and electronic leak detection and location systems
are subject to competition from alternative products. The business of
Thermal Care is dependent on the plastics industry. Any adverse trendsinformation appearing in the plastics industry may have a material adverse effect ondocuments incorporated by reference.
We will provide, without charge, copies of all documents that are incorporated herein by reference (not including the business of
Thermal Care. Thermal Care relies upon a single source for key components
of several of its products. Although the Company believes that thereexhibits to such information, unless such exhibits are alternate sources available for such components, there can be no assurance
that the interruption of supplies of such components would not have an
adverse effect on the financial condition of the Company, and that the
Company, if required to do so, would be able to negotiate agreements with
alternative sources on acceptable terms.
GOVERNMENT REGULATION. The demand for the Company's leak detection and
location systems and secondary containment piping systems is driven
primarilyspecifically incorporated by government regulation with respect to hazardous waste. Laws
such as the Federal Resource Conservation and Recovery Act ("RCRA"), and
standards such as the National Emission Standard for Hydrocarbon Airborne
Particulates ("NESHAP"), have increased the demand for the Company's leak
detection and location and secondary containment piping systems. The
Company's filtration products business to a large extent is dependent on
governmental regulation of air pollution at the federal and state levels.
The Company believes that continuing growth in the sale of filtration
products and services will be materially dependent on continuing
enforcement of environmental laws such as the Federal Clean Air Act
Amendments of 1990 ("Clean Air Act Amendments"). Although changesreference in such environmental regulations could significantly alter the demand for the
Company's products and services, the Company does not believe that such a
changeinformation) to each person, including any beneficial owner, to whom this prospectus is likelydelivered upon written or oral request. Requests should be directed to decrease demand in the foreseeable future.
ECONOMIC FACTORS. Although demand for many of the Company's products is
generally affected by its customers' need to comply with governmental
regulations, purchases of the Company's products at times may be delayed by
customers due to adverse economic factors.
DIVIDENDS. The Company has not paid dividends in the past and does not
anticipate paying cash dividends on its common stock in the foreseeable
future. The Company's line of credit agreement contains certain
restrictions on payment of dividends. The primary restriction limits
dividends to a cumulative amount of up to 25% of net income.
LACK OF ARM'S-LENGTH NEGOTIATIONS; CONFLICTS OF INTEREST. The agreements
between the Company and Midwesco relating to the Merger and the Perma-Pipe
Transaction were not negotiated on an arm's-length basis. However, the
Company believes the consideration, representations, warranties and
covenants in such agreements are fair to the Company even though they may
not provide the same level of protection as similar representations,
warranties and covenants contained in comparable agreements with persons
that are not affiliates of the Company. Members of the Board of Directors
affiliated with Midwesco (Messrs. Unger, Ogilvie, Elgendy, Gruenberg and
Henry and Bradley Mautner) will have a conflict of interest with respect to
their obligations as directors and officers of the Company, and enforcingMFRI, Inc., 7720 Lehigh Avenue, Niles, Illinois 60714, Attention: Michael D. Bennett (telephone number: (847) 966-1000.)
Unless otherwise indicated, when used herein, the terms of such agreements against Midwesco, if necessary.
"we, "us," and “our” refer to MFRI, Inc., a Delaware corporation, and its subsidiaries.
THE COMPANY
The Company
MFRI, Inc., (“MFRI”), the (“Company” or the “Registrant”) is engaged in the manufacture and sale of filter bags for useproducts in industrial air pollution control systems known as "baghouses", and also
engineers, designs and manufactures specialtythree distinct business segments: filtration products, piping systems and leak
detection and location systems, and industrial waterprocess cooling equipment.
The Company, which was incorporated in Delaware in October 1993, is the
successor corporation to Midwesco Filter Resources, Inc. ("Midwesco
Filter").
Midwesco Filter was incorporated in Delaware in October 1989 as a wholly
owned subsidiary of Midwesco. On December 13, 1989, Midwesco Filter
exchanged shares of its common stock for the net assets constituting its
Midwesco Filter Resources division ("Filter Division") of Midwesco. The
Filter Division was formed from certain assets of the Filter Media division
of the Kennecott Corporation, acquired by Midwesco in June 1982, and
certain assets of the Filter Resources Corporation, acquired by Midwesco in
December 1983.
On January 28, 1994 pursuant to a merger transaction ("Perma-Pipe
Transaction") between the Company, a subsidiary of the Company and Midwesco
Filter, the Company acquired the Perma-Pipe business ("Perma-Pipe") from
Midwesco for cash and 278,666 shares of Common Stock. Pursuant to the
Perma-Pipe Transaction, each share of common stock of Midwesco Filter was
exchanged for one share of Common Stock. Immediately prior to the
effective time of the Perma-Pipe Transaction, a public offering (the
"Offering") of shares of common stock of Midwesco Filter was consummated,
the net proceeds of which were used to repay bank debt related to
Perma-Pipe. Perma-Pipe is in the business of engineering, designing and
manufacturing specialty piping systems and leak detection and location
systems.
On September 30, 1994, the Company and an indirect wholly-owned subsidiary
of the Company, pursuant to a purchase agreement dated as of such date
("Purchase Agreement"), acquired substantially all of the assets of Ricwil
Piping Systems Limited Partnership ("Ricwil LP") for cash and 55,710 shares
of Common Stock, as adjusted in accordance with the terms of the Purchase
Agreement. Ricwil LP was a manufacturer of insulated piping systems for
district heating and cooling systems.
On December 6, 1995, Perma-Pipe acquired for cash the net assets and leak
detection business of Hagenuk GmbH.
On August 15, 1996, the Company, pursuant to an Asset Purchase Agreement
dated as of such date (the "Purchase Agreement"), acquired substantially
all of the assets of Eurotech Air Filtration, Inc., an Oregon corporation
("Eurotech"), for cash and 30,571 shares of Common Stock, subject to
possible adjustments in accordance with the terms of the Purchase
Agreement. Pursuant to the Purchase Agreement, Eurotech has the right,
subject to certain conditions, to distribute such shares to its four
shareholders.
On December 30, 1996, the Company acquired the Thermal Care Division
("Thermal Care") and certain other specified assets and liabilities of
Midwesco by the merger of Midwesco with and into MFRI (the "Merger").
Through the Merger, an aggregate of 2,124,298 shares of Common Stock were
issued to the shareholders of Midwesco and the 1,717,666 shares of Common
Stock owned by Midwesco immediately prior to the consummation of the Merger
were cancelled. Thermal Care engineers, designs and manufactures
industrial water cooling equipment.
The Company's filtration products business is carried on by Midwesco
Filter, and the piping system products business is carried on by Perma-
Pipe, Inc. Midwesco Filter and Perma-Pipe, Inc. are wholly-owned
subsidiaries of MFRI. As used herein, unless the context otherwise requires, the term Company“Company” includes MFRI Inc., Midwesco Filter, Thermal
Care, Perma-Pipe, Inc., and its subsidiaries, Midwesco Filter Resources, Inc., Perma-Pipe, Inc., Thermal Care Inc., and their predecessors.
respective predecessors and subsidiaries.
The Company's principalFiltration Products business segment manufactures and sells a wide variety of filter elements for air filtration and particulate collection systems. Air filtration systems are used in many industries in the United States and abroad to limit particulate emissions to comply with environmental regulations. The Filtration Products business segment markets air filtration-related products and accessories, and provides maintenance services, consisting primarily of dust collector inspection, filter cleaning and filter replacement.
The Piping Systems business segment engineers, designs, manufactures and sells specialty piping systems and leak detection and location systems. This segment’s specialty piping systems include (i) industrial and secondary containment piping systems for transporting chemicals, waste streams and petroleum liquids, (ii) insulated and jacketed district heating and cooking piping systems for efficient energy distribution to multiple locations from central energy plants, and (iii) oil and gas gathering flow lines and long lines for oil and mineral transportation. The Piping Systems business segment’s leak detection and location systems are sold as part of many of its piping systems products and on a stand-alone basis, to monitor areas where fluid intrusion may contaminate the environment, endanger personal safety, cause a fire hazard, impair essential services or damage equipment or property.
The Industrial Process Cooling Equipment business segment engineers, designs, manufactures and sells industrial process cooling equipment, including liquid chillers, mold temperature controllers, cooling towers, plan circulating systems, and related accessories for use in industrial process applications.
Our executive offices are located at 7720 Lehigh Avenue, Niles, Illinois, 60714 and itsour telephone number is (847) 966-1000.
Other information concerning
USE OF PROCEEDS
Unless we otherwise specify in the Company's management,applicable prospectus supplement, the net proceeds received from the sale of the securities offered by this prospectus and any prospectus supplement will be used for general corporate purposes. General corporate purposes may include the repayment of debt, financing of possible acquisitions, business securities,expansion and resultsworking capital.
PLAN OF DISTRIBUTION
We may sell the shares of operations is incorporatedCommon Stock offered hereby to one or more underwriters for public offering and sale by reference from its
reports filed withthem or may sell such shares to investors directly or through agents. Any underwriter or agent involved in the Commission. See "Information Incorporated by
Reference."
SELLING STOCKHOLDERS
The Sharesoffer and sale of such shares will be named in the applicable prospectus supplement.
Underwriters may offer and sell such shares at a fixed price or prices, which may be offeredchanged, at prices related to the prevailing market prices at the time of sale or at negotiated prices. We may, from time to time, forauthorize underwriters acting as our agents to offer and sell such shares upon the account of the Selling
Stockholders whose namesterms and conditions as are set forth in the table below. The table sets
forth information as of January 31, 1997 with respect to the beneficial
ownership of the Shares by the Selling Stockholders. To the knowledge of
the Company, none of the Selling Stockholders has any material relationshipapplicable prospectus supplement. In connection with the Company except as set forthsale of such shares, underwriters may be deemed to have received compensation from us in the footnotesform of underwriting discounts or commissions and may also receive commissions from purchasers of such shares for whom they may act as agent. Underwriters may sell such shares to the following
table and as more fully described elsewhere in this Prospectus (including
the information incorporated by reference in this Prospectus).
Any underwriting compensation paid by us to offer and sell Shares only through
brokers and dealers registered in such states.
The Selling Stockholders and any brokersunderwriters or dealers that actagents in connection with the saleoffering of Shares hereunderthe shares of Common Stock offered hereby will be set forth in the applicable prospectus supplement. The prospectus supplement may further state that such underwriters may allow discounts, concessions or commissions to participating dealers. Underwriters, dealers and
agents participating in the distribution of such shares may be deemed to be "underwriters" within
the meaning of Section 2(11) of the Securities Actunderwriters, and any discounts and commissions received by them and any profit realized by them on the saleresale of Shares as principalsuch shares may be deemed to be underwriting discounts and commissions, under the Securities Act. The Company will pay all of the expenses of the preparation, printingUnderwriters, dealers and filing of the Registration Statement, any amendments or supplements
thereto,agents may be entitled, under agreements entered into with us, to indemnification against and prospectuses and revised prospectuses as required to cover the
transactions covered hereby, as well as the Company's fees and
disbursements of its counsel and accountants relating to the Registration
Statement, but the Company is not obligated to pay any underwriting
discounts and commissions, brokers' commissions or charges, the legal fees
and expenses of the Selling Stockholders, or transfer taxes, if any,
relating to the sale or disposition of Shares by a Selling Shareholder.
The Selling Stockholders may also resell Shares in open market transactions
pursuant to the resale provisions of Rule 144contribution toward certain civil liabilities, including liabilities under the Securities Act or
in transactions otherwise permitted under the Securities Act.
LEGAL MATTERS
Certain legal matters in connection with the Shares, including the validity
EXPERTS
The consolidated financial statements and schedule of the Shares, will be passed uponCompany for the Company by Rudnick & Wolfe,
Chicago, Illinois.
EXPERTS
The financial statements of MFRI, Inc.years ended January 31, 2006 and subsidiaries incorporated2005 appearing in this Prospectus by reference from the Company'sCompany’s Annual Report on Form 10-K for the year ended January 31, 19972006 have been audited by Grant Thornton LLP, an independent registered public accounting firm, as set forth in their reports thereon included therein, and incorporated herein by reference. Such financial statements have been incorporated herein by reference, in reliance upon such reports given on the authority of such firm as experts in accounting and auditing.
The consolidated financial statements and related financial statement schedule for the year ended January 31, 2004, incorporated in this prospectus by reference from the Company’s Annual Report on Form 10-K for the year ended January 31, 2006, have been audited by Deloitte & Touche LLP, an independent auditors,registered public accounting firm, as stated in their report, which is incorporated herein by reference, and have been so incorporated in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.
INFORMATION INCORPORATED BY REFERENCE
LEGAL MATTERS
The following documents previously filedlegality of the Common Shares offered by the Company has been passed upon for us by the law firm of DLA Piper US LLP, Chicago, Illinois. DLA Piper US LLP attorneys who are participating in the representation of the Company in this offering own an aggregate of 3,100 Common Shares.
1,500,000 Shares
MFRI, INC.
Common Stock
PROSPECTUS |
_______________, 2006
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14.Other Expenses Of Issuance And Distribution
The following table sets forth those expenses for distribution to be incurred in connection with the Commission
pursuantissuance and distribution of the securities being registered.
Registration Fee | $3,535 |
Legal Fees and Expenses* | 7,500 |
Accounting Fees and Expenses* | 20,000 |
Printing and Duplicating Expenses* | 1,000 |
Miscellaneous* | 1,000 |
Total* | $33,035 |
__________
* Estimated |
II-1
Item 15. Indemnification Of Directors And Officers
Section 145 of the Delaware General Corporation Law authorizes indemnification of directors, officers, employees and agents of the Company; allows the advancement of costs of defending against litigation; and permits companies incorporated in Delaware to purchase insurance on behalf of directors, officers, employees and agents against liabilities whether or not in the circumstances such companies would have the power to indemnify against such liabilities under the provisions of the statute.
The Company’s Certificate of Incorporation and its By-Laws provide for indemnification of its officers and directors to the Exchange Act (SEC File No. 1-18370)full extent permitted by Section 145 of the Delaware General Corporation Law.
The Company’s Certificate of Incorporation eliminates, to the fullest extent permitted by Delaware law, liability of a director to the Company or its stockholders for monetary damages for breach of such director’s fiduciary duty of care except for liability where a director (a) breaches his or her duty of loyalty to the Company or its stockholders, (b) fails to act in good faith or engages in intentional misconduct or knowing violation of law, (c) authorizes payment of an illegal dividend or a stock repurchase or (d) obtains an improper personal benefit. While liability for monetary damages has been eliminated, equitable remedies such as injunctive relief or rescission remain available. In addition, a director is not relieved of his responsibilities under any other law, including the federal securities laws.
The Company has entered into indemnification agreements in the form described below with each person who is currently a member of the Board of Directors of the Company and will enter into such agreements with persons who in the future become directors of the Company. Such indemnification agreements provide for indemnification against any and all expenses incurred in connection with, as well as any and all judgments, fines, and amounts paid in settlement resulting from, any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative (collectively an “Action”), by reason of the fact that such director is or was a director, officer, employee or agent of the Company, or is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, or other enterprise. The indemnification agreements provide that if any payment, advance or indemnification of the director requires that he or she acted in good faith, in a manner he or she reasonably believed to be for or not opposed to the best interests of the Company or without reasonable cause to believe his or her conduct was unlawful, then it shall be presumed that he or she so acted unless proven otherwise by clear and convincing evidence. The indemnification agreements also provide for the advancement of all expenses, including reasonable attorneys’ fees, arising from the investigation of any claim, preparation for the defense or defense or settlement of an Action. The indemnification agreements authorize the Company to participate in the defense of any action and to assume the defense thereof, with counsel who shall be reasonably satisfactory to the director, provided that the director shall be entitled to separate counsel of his or her choosing if he or she reasonably believes that (i) there exists conflicts interests between himself or herself and the Company or other parties (the defense of whom the Company shall have assumed) or (ii) there is any substantial likelihood that the Company will be financially or legally unable to satisfy its obligations under the Indemnification Agreement. The indemnification agreements provide that a director’s rights under such contract are hereby incorporated
by reference into this Prospectus:
not exclusive of any other indemnification rights he or she may have under any provision of law, the Company’s Certificate of Incorporation or By-laws, the vote of the Company’s stockholders or disinterested directors, other agreements or otherwise.
ITEM 16. Exhibits
4.1* | - | Certificate of Incorporation of MFRI, Inc. | |
4.2** | - | By-laws of MFRI, Inc. | |
5 | - | Opinion of DLA Piper US LLP | |
23.1 | - | Consent of Grant Thornton LLP | |
23.2 | Consent of Deloitte & Touche LLP | ||
23.3 | - | Consent of DLA Piper US LLP (included in Exhibit 5) | |
24 | - | Power of Attorney |
____________________
* | Incorporated by reference to Exhibit 3.3 to Registration Statement No. 33-70298. |
** | Incorporated by reference to Exhibit 3.4 to Registration Statement No. 33-70298. |
ITEM 17. Undertakings
(a) | The undersigned Registrant hereby undertakes: |
(1) | To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
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(i) | To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; |
(ii) | To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; |
(iii) | To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in this registration statement; |
provided, however, that subparagraphs (i) and (ii) above do not apply if the registration statement of the Company's predecessoris on Form 8-AS-3, Form S-8 or Form F-3, and the information required to be included in a post-effective amendment by those paragraphs is contained in the periodic reports filed on Marchwith or furnished to the Commission by the Registrant pursuant to Section 13 1990 registering common stock of the Company's
predecessor underor Section 12(g)15(d) of the Securities Exchange Act of 1934;
(ii) the Company's Annual Report on Form 10-K1934 that are incorporated by reference in this registration statement.
(2) That, for the fiscal year ended
January 31, 1997;purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered herein, and (iii) the Company's Current Report on Form 8-K dated December 30, 1996.
All documents filedoffering of such securities at that time shall be deemed to be the initial bonafide offering thereof.
(3) To remove from registration by the Company pursuant to Section 13(a), 13(c), 14 or
15(d)means of a post-effective amendment any of the Exchange Act after the date of this Prospectus and beforesecurities being registered which remain unsold at the termination of the offeringoffering.
(4) That, for the purpose of sharesdetermining liability under the Securities Act of 1933 to any purchaser:
(A) Each prospectus filed by a registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the Common Stockregistration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and
(B) Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5) or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made hereby are
hereby incorporatedpursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of providing the information required by reference,Section 10(a) of the Securities Acct of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such documents areform of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a part hereof from thenew effective date of filingthe registration statement relating to the securities in the registration statement to which the prospectus relates, and the offering of such documents. Anysecurities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement containedmade in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed to be incorporated by reference hereininto the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.
(5) That, for the purpose of determining liability of a registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the registrant undertakes that in a primary offering of securities of the registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
(i) | Any preliminary prospectus or prospectus of the registrant relating to the offering required to be filed pursuant to Rule 424; |
(ii) | Any free writing prospectus relating to the offering prepared by or on behalf of the registrant or used or referred to by the registrant; |
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(iii) | The portion of any other free writing prospectus relating to the offering containing material information about the registrant or its securities provided by or on behalf of the registrant; and |
(iv) | Any other communication that is an offer in the offering made by the registrant to the purchaser. |
(b) The undersigned Registrant hereby further undertakes that, for the purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in this registration statement shall be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any sucha new registration statement
so modified or superseded shall not, except as so modified or superseded,
constitute a part of this Prospectus.
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON, INCLUDING ANY
BENEFICIAL OWNER OF COMMON STOCK, TO WHOM A COPY OF THIS PROSPECTUS IS
DELIVERED, UPON THE ORAL OR WRITTEN REQUEST OF SUCH PERSON, A COPY OF ANY
AND ALL OF THE INFORMATION THAT HAS BEEN INCORPORATED BY REFERENCE IN THIS
PROSPECTUS (NOT INCLUDING EXHIBITS TO THE INFORMATION THAT IS INCORPORATED
BY REFERENCE UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED BY
REFERENCE IN SUCH INFORMATION). SUCH REQUEST SHOULD BE DIRECTED TO
MICHAEL D. BENNETT, SECRETARY, MFRI, INC., 7720 LEHIGH AVENUE, NILES,
ILLINOIS 60714 (TELEPHONE (847) 966-1000).
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 16. EXHIBITS.
EXHIBIT EXHIBIT
NUMBER DESCRIPTION
2.1 Agreement for Merger by and between Midwesco, Inc. and MFRI, Inc.
[Incorporated by reference to Appendix A to the Company's Proxy Statement
dated November 12, 1996 relating to the Company's Special Meetingsecurities offered herein, and the offering of Stockholders held on December 16, 1996 (SEC File No. 0-18370)].
2.2 Agreementsuch securities at that time shall be deemed to be the initial
(c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and Plancontrolling persons of Merger by and between Midwesco, Inc. and MFRI,
Inc. [Incorporated by reference to Exhibit 2. 2the Registrant pursuant to the Company's Current
Report on Form 8-K dated December 30, 1996 (SEC File No. 0-18370)].
5 Opinion of Rudnick & Wolfe with respect toforegoing provisions or otherwise, the legalityregistrant has been advised that in the opinion of the Common
Stock being registered.
23.1 ConsentSecurities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of Deloitte & Touche LLP.
23.2 Consent of Rudnick & Wolfe (contained in Exhibit 5 hereof).
24.1 Power of Attorney of Directors and certain officersexpenses incurred or paid by a trustee, officer or controlling person of the Company.*
24.2 Powerregistrant in the successful defense of Attorneyany action, suit or proceeding) is asserted by such trustee, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of certain Directorsits counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the Company.
* Previously filed.
question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrantRegistrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this amendment
to registration statementRegistration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Niles, State of Illinois, on
May 2, 1997.
MFRI, INC.
By: /S/ DAVID UNGER
David Unger
Chairman of the Board and Chief
Executive Officer
MFRI, INC. | |
By: | /s/ David Unger |
David Unger, Chairman of the Board and Chief Executive Officer |
Pursuant to the requirements of the Securities Act of 1933, this amendment
to registration statementRegistration Statement has been signed below by the following persons in the capacities set forth below and on the date indicated.
dates indicated:
Signature | Title | Date** | |||
David Unger* | Director, Chief Executive Officer and Chairman of the Board of Directors (Principal Executive Officer) | ||||
Bradley E. Mautner* | Director, President and Chief Operating Officer | ||||
Henry M. Mautner* | Director and Vice Chairman of the Board of Directors | ||||
Michael D. Bennett* | Vice President, Secretary and Treasurer (Principal Financial and Accounting Officer) | ||||
Arnold F. Brookstone* Dennis Kessler* Eugene Miller* Stephen B. Schwartz* | Director Director Director Director | ||||
*By | / |
| |||
David Unger | |||||
**December 15, 2006 | |||||
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EXHIBIT INDEX
Exhibit Number | Exhibit Description | |
4.1* | Certificate of Incorporation of MFRI, Inc. | |
4.2** | By-laws of | |
5 | Opinion of | |
23.1 | Consent of | |
23.2 | Consent of Deloitte & Touche | |
23.3 | Consent of | |
24 | Power of Attorney |
____________________
* | Incorporated by |
** | Incorporated by reference |