SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
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 (IRS Employer
incorporation or organization) Identification No.)
7720 Lehigh Avenue
Niles, Illinois 60714
(Address, of principal executive offices)
2001 INDEPENDENT DIRECTORS STOCK OPTION PLAN
(Full title of the plan)
Mr. David Unger
Chairman of the Board of Directors
MFRI, Inc.
7720 Lehigh Avenue
Niles, Illinois 60714
(Name and address of agent for service)
(847)966-1000
(Telephone number, including area code, of agent for service)
Copy to:
Hal M. Brown, Esq.
Piper Rudnick LLP
203 North LaSalle Street
Suite 1900
Chicago, Illinois 60601
(312) 368-4012
(312) 236-7516 (telecopier)
CALCULATION OF REGISTRATION FEE
================================================================================
Proposed maximum Proposed maximum
Title of each class of Amount to be offering price aggregate Amount of
securities to be registered registered per share(1) offering price(1) registration fee
- ------------------------------------------------------------------------------------------------------------------------------------
Common Stock, par value
$.01 per share.................................... 100,000 $9.12 $556,280 $70.48
====================================================================================================================================
(1) Pursuant to Rule 457(c) and 457(h), the registration fee has been
calculated on the basis of the actual price per share (ranging from $2.15
to $3.12 per share) at which the options may be exercised with regard to
those options for which such information is available, and with regard to
the remaining shares, on the basis of $9.12 per share, the average of the
high and low sale prices of the common stock on December 21, 2004, as
reported by the Nasdaq National Market System.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents By Reference.
The Company's prospectus dated January 21, 1994 filed with the Securities
and Exchange Commission pursuant to Rule 424(b) under the Securities Act of
1933, as amended, the Company's Amended Annual Report on Form 10-K/A-2 for the
fiscal year ended January 31, 2004, the Company's Quarterly Report on Form 10-Q
for the fiscal quarter ended April 30, 2004, and the Company's Amended Quarterly
Report on Form 10-Q/A for the fiscal quarter ended July 31, 2004 are
incorporated in this registration statement by reference. All reports and proxy
statements filed by the Company pursuant to Sections 13(a), 13(c), 14 and 15(d)
of the Securities Exchange Act of 1934 subsequent to the date hereof and prior
to the filing of a post-effective amendment which indicates that all securities
offered hereby have been sold or which deregisters all securities then remaining
unsold, shall be deemed to be incorporated by reference in this registration
statement and to be a part hereof from the date of filing of such documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
An opinion with respect to the legality of the shares of common stock
subject to stock options is being given by Piper Rudnick LLP, 203 N. LaSalle
Street, Suite 1900, Chicago, Illinois, 60601, counsel for the Company.
Item 6. 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 full extent permitted by
Section 145 of the Delaware General Corporation Law.
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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 a 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 conflicting 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 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 7. Exemption from Registration Claimed.
Not applicable.
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Item 8. Exhibits.
Exhibits filed with this Amendment
4 2001 Independent Directors Stock Option Plan, as amended
[Incorporated by reference to Exhibit (d)(5) of Form SC-TO-1,
filed May 25, 2001]
5 Opinion of Piper Rudnick LLP
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of Piper Rudnick LLP (contained in Exhibit 5 hereof)
24 Power of Attorney of directors and certain officers of the
Company.
Item 9. Undertakings.
The undersigned registrant hereby undertakes (i) to file, during any period
in which offers or sales are being made, a post-effective amendment to this
registration statement 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 the registration statement; (ii) that
for the 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 therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof; and (iii) to remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned registrant hereby undertakes that, for 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 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities 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 expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
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director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the 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 registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Niles, State of Illinois, on December 21, 2004.
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
registration statement has been signed below by the following persons in the
capacities and on the date indicated.
Signature Title Date
- --------------------------- ------------------------------- ----===-----------
David Unger* Director and Chairman of the
Board of Directors (Principal
Executive Officer) +
Michael D. Bennett* Vice President, Secretary and
Treasurer (Principal Financial
and Accounting Officer)
Arnold F. Brookstone* Director +
Dennis Kessler* Director +
Bradley E. Mautner* Director +
Eugene Miller* Director +
Stephen B. Schwartz* Director +
* By: /s/ David Unger Individually and as Attorney- +
------------------- in-fact
David Unger
+ December 21, 2004
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EXHIBIT INDEX
-------------
Exhibit No.
- -----------
4.1 2001 Independent Directors Stock Option Plan, as amended
[Incorporated by reference to Exhibit (d)(5) of Form
SC-TO-1, filed May 25, 2001]
5 Opinion of Piper Rudnick LLP
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of Piper Rudnick LLP (contained in Exhibit 5 hereof)
24 Power of Attorney of directors and certain officers of the
Company
EXHIBIT 5
[LETTERHEAD OF PIPER RUDNICK LLP]
December 21, 2004
The Board of Directors
MFRI, Inc.
7720 Lehigh Avenue
Niles, Illinois 60714
Gentlemen:
We have examined the registration statement to be filed with the Securities
and Exchange Commission on or about December 21, 2004 for registration under the
Securities Act of 1933, as amended, of 100,000 shares of common stock, par value
$0.01 per share ("Common Stock"), of MFRI, Inc. (the "Company") reserved for
issuance upon the exercise of options granted and to be granted pursuant to the
Company's 2001 Independent Directors Stock Option Plan (the "2001 Plan"). We
have examined pertinent corporate documents and records of the Company,
including its Certificate of Incorporation and its By-Laws, and we have made
such other examinations as we have deemed necessary or appropriate as a basis
for the opinion hereinafter expressed.
On the basis of the foregoing, we are of the opinion that the issuance of
the aforesaid shares of common stock to be offered by the Company pursuant to
options granted or to be granted pursuant to the 2001 Plan has been duly
authorized, and, when issued and sold upon the terms and conditions set forth in
the 2001 Plan and in the options granted or to be granted thereunder, such
shares will be legally issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as an exhibit to the
registration.
Very truly yours,
PIPER RUDNICK LLP
By: /s/ Hal M. Brown
--------------------------
Hal M. Brown, a partner
EXHIBIT 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in this Registration Statement of
MFRI, Inc. on Form S-8 of our report dated May 12, 2004 (December 14, 2004 as to
Note 17), relating to the consolidated financial statements of MFRI, Inc. and
subsidiaries as of and for the year ended January 31, 2004 (which report
expresses an unqualified opinion and includes explanatory paragraphs as to MFRI
Inc. s change in its method of accounting for goodwill and intangible assets and
restatement of its balance sheet discussed in Note 17) appearing in the Annual
Report on Form 10-K/A-2 Amendment No. 2 of MFRI, Inc. and subsidiaries for the
year ended January 31, 2004. DELOITTE & TOUCHE LLP /s/ DELOITTE & TOUCHE LLP
Chicago, Illinois December 21, 2004
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned, being a
director or officer, or both, of MFRI, INC., a Delaware corporation (the
"Company"), does hereby constitute and appoint DAVID UNGER, HENRY M. MAUTNER AND
MICHAEL D. BENNETT with full power to each of them to act alone, as the true and
lawful attorneys and agents of the undersigned, with full power of substitution
and resubstitution to each of said attorneys to execute, file or deliver any and
all instruments and to do all acts and things which said attorneys and agents
deem advisable to enable the Company to comply with the Securities Act of 1933,
as amended, and any requirements or regulations of the Securities and Exchange
Commission in respect thereof, in connection with the registration under said
Securities Act of shares of common stock of the Company subject to the Company's
2001 Independent Directors Stock Option Plan, including specifically, but
without limitation of the general authority hereby granted, the power and
authority to sign his name as a director or officer or both, of the Company, as
indicated below his signature, to the registration statement, and any amendment,
post-effective amendment, supplement or papers supplemental thereto, to be filed
with respect to said shares of common stock; and each of the undersigned does
hereby fully ratify and confirm all that said attorneys and agents, or any of
them, or the substitute of any of them, shall do or cause to be done by virtue
hereof. Validity of this Power of Attorney will not be affected by failure to
acknowledge, witness or seal it.
This Power of Attorney may be executed in two or more counterparts, each of
which shall be original and off of which shall constitute one and the same
instrument.
[signatures on following page]
IN WITNESS WHEREOF, each of the undersigned has subscribed these presents,
this 17th day of November, 2004.
/s/ David Unger Director, Chairman of the Board of
- --------------------------------- Directors, President and Chief Executive
David Unger Officer
Director and Vice Chairman of the
Henry M. Mautner Board of Directors
/s/ Bradley E. Mautner Director and Executive Vice President
- ---------------------------------
Bradley E. Mautner
/s/ Arnold F. Brookstone Director
- ---------------------------------
Arnold F. Brookstone
/s/ Eugene Miller Director
- ---------------------------------
Eugene Miller
/s/ Stephen B. Schwartz Director
- ---------------------------------
Stephen B. Schwartz
/s/ Dennis Kessler Director
- ---------------------------------
Dennis Kessler
/s/ Michael D. Bennett Vice President, Secretary and Treasurer
- --------------------------------- (Principal Financial and Accounting Officer)
Michael D. Bennett