AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 4, 2006
REGISTRATION NO. 333-134742
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 1
TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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FUEL-TECH N.V.
(Exact Name of Registrant as Specified in Its Charter)
NETHERLANDS ANTILLES 3564 N/A
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification Number)
CASTROWEG 22-24
CURACAO, NETHERLANDS ANTILLES
(599) 9-461-3754
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Registrant's Principal Executive Offices)
CHARLES W. GRINNELL, ESQ.
FUEL TECH, INC.
FINANCIAL CENTRE
695 EAST MAIN STREET
STAMFORD, CONNECTICUT 06901
(203) 363-7105
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent For Service)
---------------
Copies to:
ERNEST M. LORIMER, ESQ.
FINN DIXON & HERLING LLP
1 LANDMARK SQUARE
SUITE 1400
STAMFORD, CONNECTICUT 06901
(203) 325-5000
(203) 348-5777 (FAX)
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon
as practicable after the effective date of this Registration Statement.
If the securities being registered on this form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. |_|
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) 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 post-effective amendment filed pursuant to Rule 462(d)
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. |_|
---------------------------------------
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 that we have
filed with the Securities and Exchange Commission is effective. This prospectus
is not an offer to sell these securities and is not soliciting an offer to buy
these securities in any state where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED AUGUST 4, 2006
PROSPECTUS
FUEL-TECH N.V.
-----------------------
DOMESTICATION IN DELAWARE
21,669,407 SHARES OF COMMON STOCK
-----------------------
We are Fuel-Tech N.V., a limited liability company incorporated under
the laws of the Netherlands Antilles. We are proposing a reorganization and
continuation of our business in the State of Delaware. To effect the
reorganization, we will file a new certificate of incorporation in Delaware
under which we will be domesticated and continue as a Delaware corporation with
the name "Fuel Tech, Inc." In the reorganization, each of our outstanding shares
of common stock will automatically be converted into shares of Fuel Tech, Inc.
common stock. Our Board of Managing Directors has unanimously approved the
reorganization. Netherlands Antilles law does not require that the
reorganization be approved by our stockholders. Our stockholders do not have
statutory dissenters' rights as a result of the reorganization.
Following the reorganization, two of Fuel Tech, Inc.'s wholly owned
United States subsidiaries will merge with and into Fuel Tech, Inc. on or before
December 31, 2006, and Fuel Tech, Inc. will be the surviving entity.
Our common stock is traded on the Nasdaq Stock Market under the symbol
"FTEK." We have received approval from the Nasdaq Stock Market to trade the
common stock of Fuel Tech, Inc. under the same symbol after the reorganization.
INVESTING IN OUR COMMON STOCK INVOLVES RISKS. SEE "RISK FACTORS"
BEGINNING ON PAGE 6 OF THIS PROSPECTUS.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THE SHARES OF COMMON STOCK TO BE
ISSUED IN THE REORGANIZATION OR DETERMINED IF THIS PROSPECTUS IS ACCURATE OR
COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this prospectus is __________ , 2006.
------------------------------
TABLE OF CONTENTS
PAGE PAGE
---- ----
Prospectus Summary................................ 1 Restrictions on Resale of Fuel Tech Delaware
Fuel Tech Structure Prior to the Reorganization... 3 Common Stock...................................... 21
Fuel Tech Structure After the Reorganization Description of Capital Stock...................... 22
and the Statutory Mergers......................... 4 Documents Incorporated by Reference............... 23
Cautionary Note Regarding Forward-Looking Legal Matters..................................... 24
Statements........................................ 5 Tax Matters....................................... 24
Risk Factors...................................... 6 Experts........................................... 24
The Reorganization................................ 8 Where You Can Find Additional Information......... 24
Federal Income Tax Consequences of the Appendix A - Proposed Certificate of
Reorganization.................................... 17 Incorporation of Fuel Tech, Inc................... A-1
Accounting Treatment of the Reorganization........ 21 Appendix B - Proposed Bylaws of Fuel Tech, Inc.... B-1
---------------
This prospectus is part of a registration statement that we filed with
the Securities and Exchange Commission. In making your investment decision, you
should rely only upon the information contained or incorporated by reference in
this prospectus and in the accompanying letter of transmittal. We have not
authorized any other person to provide you with different information. We are
not making an offer to sell these securities or soliciting an offer to buy these
securities in any jurisdiction where an offer or solicitation is not authorized
or in which the person making that offer or solicitation is not qualified to do
so or to anyone whom it is unlawful to make an offer or solicitation. You should
not assume the information contained in this prospectus, as well as the
information we previously filed with the Securities and Exchange Commission that
is incorporated by reference herein, is accurate as of any date other than its
respective date.
This prospectus incorporates important business and financial
information about us that is not included or delivered with this prospectus.
Such information is available without charge to any person to whom this
prospectus is delivered, upon written or oral request to:
Fuel Tech, Inc.
Attn: Investor Relations
695 East Main Street
Stamford, Connecticut 06901
Phone: (203) 425-9830
Toll-Free: (800) 887-3835
Fax: (203) 425-9823
IN ORDER TO OBTAIN TIMELY DELIVERY OF ANY REQUESTED INFORMATION, YOU MUST
REQUEST THE INFORMATION NO LATER THAN _____________, 2006, WHICH IS FIVE
BUSINESS DAYS PRIOR TO THE REORGANIZATION.
---------------
i
PROSPECTUS SUMMARY
The following summary highlights key information contained elsewhere or
incorporated by reference in this prospectus. It is not complete and may not
contain all of the information that may be important to you. We urge you to read
this entire prospectus carefully, especially the discussion of "Risk Factors"
and our consolidated financial statements and related notes. Doing so will give
you a more complete description of us and the proposed reorganization.
Throughout this prospectus (unless the context otherwise requires), when we
refer to "Fuel-Tech N.V.," "we," "our," or "us," we are describing Fuel-Tech
N.V., a Netherlands Antilles entity, together with its subsidiaries and other
operations. When we refer to "Fuel Tech Delaware," we are referring to Fuel
Tech, Inc., the entity Fuel-Tech N.V. will become upon the effectiveness of the
reorganization.
FUEL-TECH N.V.
We are a technology company active in the air pollution control and
specialty chemical businesses. We operate our business through our wholly owned
subsidiary, Fuel Tech, Inc., or FTI, a Massachusetts corporation. We were
incorporated in 1987 under the laws of the Netherlands Antilles. Our principal
executive offices are located at 695 East Main Street, Stamford, Connecticut
06901 and our telephone number is (203) 425-9830. Our internet address is
www.fueltechnv.com.
FTI's special focus is the worldwide marketing of its nitrogen oxide,
or NOx, reduction and flue gas treatment processes. Our NOx reduction
technologies are used to reduce NOx emissions in flue gas from boilers,
incinerators, furnaces and other stationary combustion sources. Our FUEL CHEM(R)
product line uses chemical processes for the control of slagging, fouling and
corrosion and for plume abatement in furnaces and boilers through the addition
of chemicals directly into the fuel or via our proprietary TIFI(TM), Targeted
In-Furnace Injection(TM) programs. FTI has a number of other technologies, both
commercial, and in the development stage, that are related to our NOx reduction
processes or similar in their technological base. FTI's business is materially
dependent on the continued existence and enforcement of worldwide air quality
regulations.
THE REORGANIZATION
We intend to change our place of incorporation from the Netherlands
Antilles to the State of Delaware. We will effect the reorganization by filing a
new certificate of incorporation and a certificate of domestication in Delaware
and a corresponding document in the Netherlands Antilles. We anticipate that the
reorganization will become effective on ______________, 2006.
SHARE EXCHANGE
In the reorganization, each share of Fuel-Tech N.V. common stock
outstanding immediately prior to the reorganization will be automatically
converted into one share of Fuel Tech Delaware common stock. It is not necessary
for stockholders of Fuel-Tech N.V. to exchange their existing stock certificates
for certificates of Fuel Tech Delaware.
REASONS FOR THE REORGANIZATION
Our Board of Managing Directors has unanimously approved the
reorganization because it believes that it will, among other things:
o allow us to simplify our legal structure;
o allow certain investors, including institutional investors who
may not be permitted to invest in foreign corporations, to
invest in our common stock; and
o eliminate what we understand to be uncertainties perceived to
accompany an investment in a corporation domiciled in the
Netherlands Antilles, a country that does not have an income tax
treaty in effect with the United States.
1
FEDERAL INCOME TAX CONSEQUENCES OF THE REORGANIZATION
We retained Deloitte Tax LLP to advise us as to the treatment of the
reorganization for United States federal income tax purposes. Deloitte Tax LLP
is of the opinion the reorganization should be tax-free to Fuel-Tech N.V. and
Fuel Tech Delaware. Based upon our belief that Fuel-Tech N.V. will have a
deficit in current year earnings and profits (for the tax year that will end on
the date of the reorganization) and that it has had a deficit in earnings and
profits in each of its previous tax years and that Fuel-Tech N.V. is not and has
never been a "passive foreign investment company" under the Internal Revenue
Code, stockholders of Fuel-Tech N.V. should not recognize income as a result of
the reorganization except in the case of:
o U.S. persons who on the date of the reorganization own stock of
Fuel-Tech N.V. having a fair market value of $50,000 or more,
but do not beneficially own 10% or more of the voting power of
Fuel-Tech N.V., and who fail to make a valid federal income tax
election (as described herein).
For a more detailed discussion of the tax consequence of the reorganization,
please see "Federal Income Tax Consequences of the Reorganization," beginning on
page 16 of this prospectus.
NOTE: You may be required to make a filing with the IRS (and give us notice of
your election) in order to avoid recognizing income as a result of this
reorganization. If you are required to make a filing, we will send you
additional information, including a form for your filing and substantiation of
the earnings and profits of Fuel-Tech N.V., after the reorganization is
completed. Although it is our responsibility to send you this information, any
and all filings are your responsibility.
NO DISSENTERS' RIGHTS IN THE REORGANIZATION
Fuel-Tech N.V. stockholders do not have statutory dissenters' rights in
relation to the reorganization.
STATUTORY MERGERS AFTER THE REORGANIZATION
In a further effort to simplify our legal structure, our Board of
Managing Directors and the boards of our two wholly owned United States
subsidiaries have approved the following statutory mergers, each of which shall
occur after the reorganization but on or prior to December 31, 2006:
(1) FTI will merge with and into Fuel Tech Delaware, and Fuel Tech
Delaware will be the surviving entity; and
(2) Platinum Plus Inc., a Delaware corporation and wholly owned
subsidiary, will merge with and into Fuel Tech Delaware and Fuel Tech Delaware
will be the surviving entity.
The chart on the following page depicts our legal structure prior to
the reorganization. The chart on page 4 depicts our legal structure after the
reorganization and the statutory mergers.
2
FUEL TECH
STRUCTURE PRIOR TO THE REORGANIZATION
-----------------------------
| Fuel-Tech N.V. |
| (Netherlands Antilles) |
-----------------------------
| |
| |
100% | | 100%
----------------------- -------------------
| Platinum Plus, Inc. | | Fuel Tech, Inc. |
| (Delaware) | | (Massachusetts) |
----------------------- -------------------
|
|
|
--------------------------------------------------------------------------------
| | | |
| | | |
| 100% | 100% | 100% | 100%
--------------------- ----------------------- ---------------------- -------------------------
| Fuel Tech Jamaica | | Fuel Tech Targeted | | Fuel Tech Holdings | | Fuel Tech Srl (Italy) |
| Limited (Jamaica) | | Injection Chemicals | | N.V. (Netherlands | | |
| | | Ltd. (Canada) | | Antilles) | | |
--------------------- ----------------------- ---------------------- -------------------------
|
|
| 100%
----------------------
| Fuel Tech BV |
| (Netherlands) |
----------------------
|
|
| 100%
----------------------
| Fuel Tech GmbH |
| (Germany) |
----------------------
3
FUEL TECH STRUCTURE
AFTER THE REORGANIZATION AND THE STATUTORY MERGERS
-----------------------------
| Fuel Tech, Inc. |
| (Delaware) |
-----------------------------
|
| 100%
|
--------------------------------------------------------------------------------
| | | |
| | | |
| 100% | 100% | 100% | 100%
--------------------- ----------------------- ---------------------- -------------------------
| Fuel Tech Jamaica | | Fuel Tech Targeted | | Fuel Tech Holdings | | Fuel Tech Srl (Italy) |
| Ltd. (Jamaica) | | Injection Chemicals | | N.V. (Netherlands | | |
| | | Ltd. (Canada) | | Antilles) | | |
--------------------- ----------------------- ---------------------- -------------------------
|
|
| 100%
----------------------
| Fuel Tech BV |
| (Netherlands) |
----------------------
|
|
| 100%
----------------------
| Fuel Tech GmbH |
| (Germany) |
----------------------
4
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in this prospectus and the documents
incorporated by reference herein include "forward-looking statements" within the
meaning of Section 27A of the Securities Act and Section 21E of the Securities
Exchange Act of 1934. Forward-looking statements include statements concerning
our plans, objectives, goals, strategies, competition, trends or developments in
our industries, future events, future revenue or performance, capital
expenditures, financing needs, plans or intentions relating to acquisitions and
other information that is not historical information. When used in this
prospectus and the documents incorporated by reference herein, the words
"estimates," "expects," "anticipates," "projects," "plans," "intends,"
"believes" and variations of such words or similar expressions are intended to
identify forward-looking statements. All forward-looking statements, including,
without limitation, our examination of historical operating trends, are based
upon our current expectations and various assumptions. Our expectations, beliefs
and projections are expressed in good faith and we believe there is a reasonable
basis for them, but there can be no assurance that our expectations, beliefs and
projections will be realized.
There are a number of risks and uncertainties that could cause our
actual results to differ materially from the forward-looking statements
contained in this prospectus. Important factors that could cause our actual
results to differ materially from the forward-looking statements we make
include, but are not limited to, product demand, pricing, market acceptance,
litigation, risk of dependence on significant customers, third-party suppliers
and intellectual property rights, risks in product and technology development,
and other factors, including those described in this prospectus under the
heading "Risk Factors," as well as other filings we make with the Securities and
Exchange Commission.
Readers are cautioned not to place undue reliance on these
forward-looking statements. All forward-looking statements attributable to us or
persons acting on our behalf apply only as of the date of this prospectus and
are expressly qualified in their entirety by the cautionary statements included
in this prospectus. We undertake no obligation to publicly update or revise
forward-looking statements which may be made to reflect events or circumstances
after the date made or to reflect the occurrence of unanticipated events, except
as required by applicable securities laws.
5
RISK FACTORS
Investing in our common stock involves various risks, including the
material risks described below. You should carefully consider each of the
following risks. If any of the events described below actually occur, our
business, financial condition and operating results could be adversely affected.
As a result, the trading price of our common stock could decline, perhaps
significantly, and you could lose all or part of your investment.
RISKS RELATING TO THE CHANGE IN OUR PLACE OF INCORPORATION
YOUR RIGHTS AS A STOCKHOLDER MAY BE DIFFERENT AND COULD BE LIMITED BY DELAWARE
LAW AS A RESULT OF THE REORGANIZATION.
Some of your rights as a stockholder under Delaware law and the Fuel
Tech Delaware certificate of incorporation and bylaws will differ from some of
the rights you have as a stockholder under Netherlands Antilles law and
Fuel-Tech N.V.'s governing documents. In some ways, your rights as a stockholder
may be limited by our reorganization. For example, Delaware law allows a
corporation to include in its Certificate of Incorporation the right to amend
its bylaws without obtaining the approval of its stockholders. Fuel Tech
Delaware's certificate of incorporation permits its Board of Directors to amend
its bylaws without first obtaining the approval of its stockholders. For a more
detailed description of the rights of the stockholders of Fuel Tech Delaware,
please read "The Reorganization" starting on page 8 of this prospectus, and
Appendix A and Appendix B to this prospectus.
THE REORGANIZATION COULD RESULT IN ADVERSE TAX CONSEQUENCES FOR YOU AND US.
Depending on your circumstances, you may be required to make a filing
with the Internal Revenue Service as a result of the change of our place of
incorporation. Failure to make this filing on a timely basis could result in
your owing taxes because of the change, even though you will not have realized
any income or liquidity as a result of the change. For a more detailed
description of the tax consequences associated with this transaction, please
read "Federal Income Tax Consequences of the Reorganization" starting on page 16
of this prospectus. We also urge you to consult with your own tax advisor. In
addition, after the change in our place of incorporation, our effective
corporate tax rate may increase.
RISKS RELATED TO OUR BUSINESS
LACK OF DIVERSIFICATION IN OUR BUSINESS MAY IMPACT OUR ABILITY TO GENERATE
REVENUE.
We have two business segments that provide advanced engineering
solutions for the optimization of combustion systems in utility and industrial
applications. They are as follows:
o The NOx reduction technology segment, which includes our processes for
the reduction of NOx emissions in flue gas from boilers, incinerators,
furnaces and other stationary combustion sources; and
o The fuel treatment chemical segment, which uses chemical processes for
the control of slagging, fouling and corrosion and for plume abatement
in furnaces and boilers through the addition of chemicals directly into
the fuel or by our proprietary Targeted In-Furnace Injection(TM)
technology.
An adverse development in our advanced engineering solutions business
as a result of competition, technological change, government regulation, or any
other factor could have a significantly greater impact than if we maintained
more diverse operations, as such operations account for almost all of our
revenue.
OUR COMPETITION, AND OUR CUSTOMERS' ABILITY TO COMPLY WITH REGULATIONS WITHOUT
THE USE OF OUR TECHNOLOGY, MAY AFFECT OUR BUSINESS.
Competition in the NOx control market comes from processes utilizing
low-NOx burners, over-fire air, flue gas recirculation, ammonia selective
catalytic reduction and non-catalytic reduction and, with respect to particular
uses of urea that do not infringe upon our patents, urea. Competition also comes
from business practices such as the
6
purchase rather than the generation of electricity, fuel switching, closure or
derating of units, and sale or trade of pollution credits. Utilization by our
customers of such processes or business practices or combinations thereof may
adversely affect our pricing and participation in the NOx control market if
customers elect to comply with regulations by methods other than our processes
to reduce NOx.
Competition in the FUEL CHEM(R) markets includes chemicals sold by
specialty chemical companies, such as GE Betz, Inc., primarily in the
traditional heavy-fuel-oil treatment area. Although no significant competition
currently exists for our Targeted In-Furnace Injection(TM) processes of
additives for the control of slagging, fouling, and corrosion and for plume
abatement, there can be no assurance that such lack of substantive competition
will continue.
WE ARE DEPENDENT ON CERTAIN REGULATIONS, INCLUDING WORLDWIDE AIR QUALITY
REGULATIONS, WHICH IF REPEALED, WOULD HAVE A MATERIAL IMPACT ON OUR BUSINESS.
The domestic U.S. air pollution control market is the primary driver of
our NOx reduction business. This market is dependent upon air pollution
regulations and their continued enforcement. Because our business is
significantly impacted by the regulatory environment surrounding the markets in
which we serve, our business will be adversely impacted to the extent that
regulations are repealed or amended to significantly reduce the level of
required NOx reduction or to the extent that regulatory authorities minimize
such enforcement.
OUR ABILITY TO COMPETE DEPENDS ON OUR ABILITY TO PROTECT OUR INTELLECTUAL
PROPERTY, WHICH MAY NOT BE ADEQUATELY PROTECTED.
We hold licenses under and own a number of patents. We also have patent
applications pending approval. There can be no assurance that pending patent
applications will be granted or that outstanding patents will not be challenged
or circumvented by our competitors. Certain critical technology relating to our
products is protected by trademark and trade secret laws and by confidentiality
and licensing agreements. There can be no assurance that such protection will
prove adequate or that we will have adequate remedies for disclosure of our
trade secrets or violations of our intellectual property rights.
RISKS RELATING TO OUR COMMON STOCK
THE PRICE OF OUR COMMON STOCK MAY FLUCTUATE SUBSTANTIALLY, WHICH COULD
NEGATIVELY AFFECT US AND THE HOLDERS OF OUR COMMON STOCK.
The price of our common stock has been volatile. Since May 2, 2005, the
high and low bid quotations of our common stock has ranged from a low of $5.33
to a high of $18.80. The trading price of our common stock may continue to be
volatile in response to a number of factors, many of which are beyond our
control, including, among others, negative news about other publicly traded
companies in our industry and the industries of our customers, general economic
or stock market conditions unrelated to our operating performance, quarterly
variations in our operating results, changes in earnings estimates by analysts,
and announcements of new clients or service offerings by our competitors. In
addition, our financial results may be below the expectations of securities
analysts and investors. If this were to occur, the market price of our common
stock could decrease, perhaps significantly.
In addition, the U.S. securities markets have from time to time
experienced significant price and volume fluctuations. These fluctuations often
have been unrelated to the operating performance of companies in these markets.
Broad market and industry factors may negatively affect the price of our common
stock, regardless of our operating performance. Further, if we were to be the
object of securities class action litigation as a result of volatility in our
common stock price or for other reasons, such litigation could result in
substantial costs and divert our management's attention and resources, which
could negatively affect our financial results. In addition, if we decide to
settle any class action litigation against us, our decision to settle may not
necessarily be related to the merits of the claim.
7
THE REORGANIZATION
Our Board of Managing Directors believes that it is in our best
interest and the best interest of our stockholders to change our place of
incorporation from the Netherlands Antilles to the State of Delaware. We urge
all of our stockholders to carefully read the following sections of this
prospectus, including the related appendices.
We will effect the reorganization by filing a new certificate of
incorporation and a certificate of domestication in Delaware and a corresponding
document in the Netherlands Antilles. We anticipate that the reorganization will
become effective on ______________, 2006. The reorganization does not need to be
approved by the stockholders of Fuel-Tech N.V. After the reorganization, but on
or prior to December 31, 2006, our wholly owned United States subsidiaries, FTI
and Platinum Plus, Inc., will each merge with and into Fuel Tech Delaware, and
Fuel Tech Delaware will be the surviving entity.
EFFECTS OF THE REORGANIZATION
Each share of Fuel-Tech N.V. common stock outstanding will be converted
into one share of Fuel Tech Delaware common stock. Fuel Tech Delaware will be
deemed to have been incorporated in Delaware on the date Fuel-Tech N.V. was
incorporated in the Netherlands Antilles. The powers, assets, rights and
liabilities of Fuel-Tech N.V. will continue with Fuel Tech Delaware.
The reorganization will not result in any change in our business,
management, fiscal year, operating assets, liabilities or location of our
principal facilities. Our directors prior to the reorganization will continue to
serve as our directors after the reorganization. All of our stock option
agreements will be continued by Fuel Tech Delaware, and each outstanding option
or warrant to purchase shares of Fuel-Tech N.V. common stock will automatically
be converted into an option or warrant to purchase that same number of shares of
Fuel Tech Delaware common stock upon the same terms and subject to the same
conditions. Our other employee benefit arrangements will continue and will be
maintained by Fuel Tech Delaware after the reorganization upon the terms, and
subject to the conditions, currently in effect.
REORGANIZATION SHARE EXCHANGE
In the reorganization, each outstanding share of Fuel-Tech N.V. common
stock held by our stockholders will be converted into one share of Fuel Tech
Delaware common stock. The shares so exchanged will be all of Fuel Tech
Delaware's issued and outstanding shares immediately after the reorganization.
The number of shares of Fuel Tech Delaware common stock outstanding immediately
after the reorganization will be the same number of shares of Fuel-Tech N.V.
common stock outstanding immediately before the reorganization.
Fuel Tech Delaware will not issue new stock certificates to Fuel-Tech
N.V. stockholders. You will receive a new stock certificate only upon any future
transaction in Fuel Tech Delaware common stock that requires our transfer agent
to issue stock certificates in exchange for existing stock certificates. It is
not necessary for stockholders of Fuel-Tech N.V. to exchange their existing
stock certificates for certificates of Fuel Tech Delaware. Until surrendered and
exchanged, each certificate evidencing Fuel-Tech N.V. common stock will be
deemed for all purposes to evidence the identical number of shares of Fuel Tech
Delaware common stock.
BACKGROUND AND REASONS FOR THE REORGANIZATION
Fuel-Tech N.V. was organized in 1987 by European investors as a vehicle
to acquire the then-existing Fuel Tech, Inc. Their perception was that the
company could develop a substantial non-U.S. market, with considerable revenues
in the form of intellectual property royalties, particularly in Europe. The
Netherlands Antilles was thought to be an appropriate jurisdiction acceptable to
the parties in which to incorporate. In addition, this jurisdiction offered the
prospect of potential tax savings on royalty income via the tax treaties in
force among various European countries, the Netherlands and the Netherlands
Antilles. After the acquisition of the Company in 1987, however, the U.S.
remained the major market for Fuel Tech products and services, and neither a
substantial European market nor significant royalty revenue developed.
8
Thereafter, on an informal basis, the officers and directors of Fuel
Tech, Inc. and Fuel-Tech N.V. from time to time discussed and inquired as to
whether there were any particular advantages or disadvantages associated with
the continued organization of Fuel-Tech N.V. in the Netherlands Antilles. The
general view of management was that the current organization was awkward and
complicated because the parent company and issuer of common shares was located
in the Netherlands Antilles, while the principal subsidiary employing most of
the group's personnel and conducting and managing all of the company's
operations, in the United States and elsewhere, was in the United States.
Additionally, potential investors would from time to time express reservations
to management about investing in a company organized in a country other than the
United States. Moreover, since the Netherlands Antilles did not have a U.S. tax
treaty, there were uncertainties as to the tax effect of future dividends, if
any, and various potential cross border transactions. Nevertheless, at that
time, the officers and directors did not believe that there were sufficient
reasons overall to justify the expense of engaging in a U.S. domestication.
Because most of our assets are located in the United States, and our
management is located in the United States, we are subject to the same reporting
regimen for United States securities law purposes as if we were incorporated in
the United States.
At a Board meeting in August 1999, and at the request of the Chairman,
the Chief Financial Officer of Fuel-Tech N.V. reviewed with the Board the likely
costs and effects of domestication in the United States, including the effects
of filing federal and state tax returns as a U.S. taxpayer. Upon review, the
Board decided to defer consideration of the issue until a later time.
The Board later reviewed the tax aspects of Fuel-Tech N.V.'s current
organization and the utility of other potential structures with an independent
tax advisor at a Board meeting in May 2002. At the conclusion of this review,
the Board took the matter under advisement but took no further action.
In December 2002, the Chief Financial Officer and the General Counsel
reported at a meeting of the Board that after careful consideration the
continued use of the Netherlands Antilles jurisdiction for the parent company,
Fuel-Tech N.V., did not offer significant continuing advantages, and other
off-shore structures, specifically reincorporating in Bermuda, did not appear to
be feasible or useful. The Chief Financial Officer also reported that he
understood certain potential investors in Fuel-Tech N.V. had investment
limitations restricting them to investments in U.S. companies. A domestication
in Delaware was recommended by these officers. After careful consideration, the
Board requested that the staff review the feasibility, costs and tax effects of
a domestication in Delaware and report their findings to the Board at a later
time. Moreover, if the staff believed a domestication to be feasible and
advantageous, they were to propose a plan to implement a domestication.
At a Board meeting in March 2003, the Chief Financial Officer and the
General Counsel reported back on their progress on the domestication study, and
the Board requested that the discussion be continued at a later meeting.
The Chief Financial Officer again discussed various aspects of the
domestication of Fuel-Tech N.V. at a Board meeting in December 2005. He reported
that the domestication in itself did not appear to present adverse tax
consequences. He further reported that the staff of Fuel-Tech N.V. had a
provisional target date of July 1, 2006 for the domestication. The Board then
authorized the Chief Financial Officer to seek a tax opinion from Deloitte Tax
LLP on the tax aspects of domestication and to report back to the Board at a
later meeting.
In May 2006, the Chief Financial Officer and the General Counsel
proposed a plan of reorganization and domestication. After a discussion of the
costs and procedures associated with such reorganization and domestication, the
advantages to be gained by the reorganizations and domestication, the Fuel Tech
N.V. Board found the plan of reorganization and domestication to be overall
advantageous to Fuel-Tech N.V. and its shareholders and approved it in
substantially the same form as described in this prospectus.
Our Board of Managing Directors unanimously approved the
reorganization because it believes that it will, among other things:
o allow us to simplify our legal structure;
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o allow certain investors, including institutional investors who
may not be permitted to invest in foreign corporations, to invest
in our common stock; and
o eliminate what we understand to be uncertainties perceived to
accompany an investment in a corporation domiciled in the
Netherlands Antilles, a country that does not have an income tax
treaty in effect with the United States.
For many years Delaware has been a leader in adopting, implementing and
interpreting comprehensive and flexible corporate laws that are responsive to
the legal and business needs of corporations. Many publicly and privately held
corporations initially choose Delaware for their state of incorporation or
subsequently change their corporate domiciles to Delaware in a manner similar to
that proposed by us. Because of Delaware's prominence as the state of
incorporation for many major corporations, both the legislature and courts in
Delaware have demonstrated an ability and a willingness to act quickly and
effectively to meet changing business needs. The Delaware courts have developed
considerable expertise in dealing with corporate issues, and a substantial body
of case law has developed interpreting Delaware law and establishing public
policies with respect to corporate legal affairs.
Despite the unanimous belief of our Board of Directors that the
reorganization is in our best interests and that of our stockholders, some
stockholders may find the proposal disadvantageous to the extent that it has the
effect of discouraging a future takeover attempt that is not approved by the
Board of Directors, but that a majority of the stockholders deem to be in their
best interests or in which stockholders are to receive a substantial premium for
their shares over the market value or their cost basis in such shares. In
addition, to the extent that these provisions enable the Board of Directors to
resist a takeover or a change in control of Fuel Tech Delaware, they could make
it more difficult to change the existing Board of Directors and management or to
make a change in control of Fuel Tech Delaware that is opposed by the Board.
This strengthened tenure and authority of the Board could enable the Board of
Directors to resist change and otherwise thwart the desires of a majority of the
stockholders.
Delaware law has been criticized by some commentators on the grounds
that it does not afford minority stockholders the same substantive rights and
protections as are available in a number of other states. For a comparison of
stockholders' rights and the powers of management under Netherlands Antilles and
Delaware law, please see "Differences in Governing Corporate Law" above.
Our Board of Managing Directors has examined the terms of the
reorganization considered the advantages and potential disadvantages and
unanimously approved it after concluding that it is in our best interests
and that of our stockholders.
NO CHANGE IN THE BUSINESS, MANAGEMENT, EMPLOYEE PLANS OR LOCATION
The reorganization will effect a change in the legal domicile of
Fuel-Tech N.V., and other changes of a legal nature, which are described in this
prospectus. The reorganization should not result in any change in the business,
management, fiscal year, assets, liabilities or location of the principal
facilities of Fuel-Tech N.V. All Fuel-Tech N.V. employee benefit and stock
option agreements will be continued by Fuel Tech Delaware.
The Board of Directors of Fuel Tech Delaware immediately following the
reorganization will be the existing Board of Managing Directors of Fuel-Tech
N.V., namely Douglas G. Bailey, Ralph E. Bailey, Miguel Espinosa, Charles W.
Grinnell, Thomas L. Jones, Samer S. Khanachet, John D. Morrow, John F. Norris,
Jr., and Thomas S. Shaw. The executive officers of Fuel Tech Delaware
immediately following the reorganization will be the current executive officers
of Fuel-Tech N.V. Fuel-Tech N.V.'s subsidiaries, FTI, Platinum Plus, Inc., Fuel
Tech Jamaica Ltd., Fuel Tech Targeted Injection(TM) Chemicals Ltd., Fuel Tech
Holdings N.V. and Fuel Tech Srl, will continue as subsidiaries of Fuel Tech
Delaware and the Boards of Directors and executive officers of those
subsidiaries will remain the same. After the reorganization but on or prior to
December 31, 2006, FTI and Platinum Plus, Inc. will each merge with and into
Fuel Tech Delaware and Fuel Tech Delaware will be the surviving entity.
DIFFERENCES IN GOVERNING CORPORATE LAW
After the reorganization, we will be incorporated in the State of
Delaware and will no longer be domiciled in the Netherlands Antilles. We will
become subject to the laws of Delaware as of the date we are incorporated in
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the State of Delaware. We will not, however, be relieved of any obligations
or liabilities we incurred before our incorporation in Delaware, because our
existence as a corporation will be deemed to have commenced on the date we were
incorporated in the Netherlands Antilles. The term "domiciled" under Netherlands
Antilles corporate law means that the company is located in the Netherlands
Antilles and is subject to the laws of the Netherlands Antilles, whereas under
Netherlands Antilles corporate law, the term "incorporated" simply means the
date the company came into existence. Other than with respect to the differences
in governing corporate law discussed below, there are no material differences
between the terms of the shares of common stock of Fuel-Tech N.V. and the shares
of common stock of Fuel Tech Delaware.
The following summary describes the material differences between
Netherlands Antilles corporate law and Delaware corporate law.
STOCKHOLDER MEETINGS
Netherlands Antilles law provides that a general meeting of the
company's stockholders must be held at least once a year. Under Netherlands
Antilles law, general meetings of stockholders must be held in the Netherlands
Antilles on the island where the company's registered office is established,
unless the company's articles of association provide otherwise. Fuel-Tech N.V.'s
articles of association provide that the general meetings of its stockholders be
held on Curacao, Bonaire, St. Maarten (Netherlands Antilles), Saba or St.
Eustatius. Information meetings for stockholders, however, may be held outside
of the Netherlands Antilles. Written proxies are permitted at the stockholder
meetings held in the Netherlands Antilles. Netherlands Antilles law does not
have quorum requirements.
Netherlands Antilles law also allows a stockholder, who individually or
together with other stockholders holds at least ten percent of the outstanding
shares of the company, to request in writing that the managing directors of the
company call a general meeting of the stockholders to consider and vote upon the
matters presented by the stockholder or stockholders requesting the general
meeting. The stockholder or stockholders requesting the general meeting must
have a reasonable interest relating to the matters presented.
Under Delaware law, meetings of stockholders may be held either within
or outside of the State of Delaware, as the corporation designates in its
certificate of incorporation or bylaws. If the corporation does not designate
such information in its certificate of incorporation or bylaws, the board of
directors is responsible for determining the meeting place, which may be at any
place the board determines, or at no place at all, if the board elects to hold
the meeting solely through means of remote communication. The proposed bylaws of
Fuel Tech Delaware allow a stockholder, who individually or together with other
stockholders holds a majority of the outstanding shares of Fuel Tech Delaware,
to request in writing that the Chairman or Chief Executive Officer or Secretary
of Fuel Tech Delaware, call a special meeting of the stockholders to consider
and vote upon the matters presented by the stockholder or stockholders
requesting the special meeting. Delaware law provides that a corporation's
certificate of incorporation or the bylaws may specify what constitutes a
quorum, but generally, a quorum cannot be less than one-third of the shares
entitled to vote at the meeting. The proposed bylaws of Fuel Tech Delaware
provide for a quorum of one-third of the shares entitled to vote at the meeting.
ACTION BY WRITTEN CONSENT OF STOCKHOLDERS
Under Netherlands Antilles law, any resolution that may be adopted at
the general meeting of stockholders may also be adopted by the stockholders
outside of the general meeting. Such resolution must be adopted by a vote of all
stockholders entitled to vote on such matter. Prior notice of the intended
adoption of the resolution outside of the general meeting must be given to all
of the company's stockholders and managing directors in a timely manner.
Under Delaware law, stockholders may act by written consent without a
meeting if such consent is signed by stockholders having not less than the
minimum number of votes that would be required to take such action at a meeting.
Fuel Tech Delaware's proposed bylaws provide for stockholder action by written
consent.
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RIGHTS OF DISSENTING STOCKHOLDERS
Under Netherlands Antilles law, a stockholder whose rights or interests
are prejudiced by a specific action of the managing directors or the company in
such a manner that continued ownership of the stock by such stockholder cannot
reasonably be required, may request that a Netherlands Antilles court require
the company to repurchase the shares held by such stockholder.
Generally, stockholders of a Delaware corporation who dissent from a
merger or consolidation for which a stockholders' vote is required are entitled
to appraisal rights that require the surviving corporation to purchase the
dissenting shares at fair value, as agreed or determined in a judicial
proceeding. There are, however, generally no statutory rights of appraisal with
respect to stockholders of a Delaware corporation, such as Fuel Tech Delaware,
whose shares of stock are (1) listed on a national securities exchange or
designated as a national market system security on an interdealer quotation
system by the National Association of Securities Dealers, Inc. or (2) held of
record by more than 2,000 stockholders, where such stockholders receive only
shares of stock of the corporation surviving or resulting from the merger or
consolidation or cash in lieu of fractional interests therein.
STOCKHOLDER DERIVATIVE SUITS
Netherlands Antilles law is silent with respect to stockholder
derivative suits.
Under Delaware law, a stockholder may only bring a derivative action on
behalf of the corporation if the stockholder was a stockholder of the
corporation at the time of the transaction in question or his or her stock
thereafter devolved upon him or her by operation of law.
INSPECTION OF BOOKS AND RECORDS
Under Netherlands Antilles law, each stockholder has the right to
inspect the company's annual accounts prepared by the managing directors and
approved at the general meeting of stockholders, including any documents
relating thereto, for a period of two years from the date the annual accounts
were prepared or, as the case may be, approved. Each stockholder is entitled to
inspect the company's annual accounts prepared by the managing directors and
approved at the general meeting of stockholders, including any documents
relating thereto, insofar as the inspection of the annual accounts relates to
the shares held by such stockholder. A company's articles of association may
grant the right of inspection to other individuals.
Delaware law allows any stockholder to inspect the stockholder list and
the corporation's books and records for a purpose reasonably related to such
person's interests as a stockholder.
CORPORATE MANAGEMENT
A Netherlands Antilles company is managed by a board of managing
directors. If provided for in the articles of incorporation, the board of
managing directors may be supervised by a board of supervisory directors. The
board of managing directors may also appoint an attorney-in-fact, in the
Netherlands Antilles or abroad, with limited or unlimited powers to conduct
business on behalf of the company. Managing directors are elected by a majority
of the votes of the stockholders of the company.
A Delaware corporation is governed by a board of directors, unless the
corporation provides otherwise in its certificate of incorporation. The board of
directors consists of one or more members, each of whom must be a natural
person. Pursuant to Fuel Tech Delaware's by-laws, Directors of Fuel Tech
Delaware will be elected by a plurality of the votes cast. Each director holds
office until that director's successor is elected and qualified or until such
director's earlier resignation or removal. A corporation will also elect
officers, setting forth each officer's title and duty in the corporation's
bylaws or in a resolution of the board of directors. Each officer holds office
until that officer's successor is elected and qualified or until that officer's
earlier resignation or removal.
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REMOVAL OF DIRECTORS
Under Netherlands Antilles law, a managing director may be removed,
suspended or dismissed by the body or person that appointed such managing
director.
Under Delaware law, directors may be removed, with or without cause, by
the holders of a majority of the outstanding shares entitled to vote. However,
unless the corporation's certificate of incorporation otherwise provides, if the
board is classified then stockholders may only remove directors for cause.
LIMITATION OF LIABILITY OF DIRECTORS
Under Netherlands Antilles law, each managing director owes an
obligation to the company to properly perform the duties that fall within the
scope of his or her responsibilities. Responsibilities of managing directors
include all the duties of management that are not specifically allocated to one
or more other managing directors under or pursuant to the company's articles of
association.
Although each managing director is responsible for his or her own
assigned tasks, all of the managing directors of the company are responsible for
the general course of affairs of the company and must, when possible,
endeavor to prevent the occurrence of an act or omission which may cause a loss
to the company, even if the matter falls outside his or her designated
responsibilities. Failure to do so could result in the managing directors being
found liable to the company. The managing directors to whom certain tasks have
been assigned are required to keep the other managing directors regularly
informed as to the state of affairs relating to such managing director's
responsibilities. Under Netherlands Antilles law, approval by the stockholders
of the report of management and financial statements for a particular year
exculpates the managing directors from certain liabilities with regard to such
report of management and such financial statements for that year.
A managing director's failure to prevent an act or omission that has
caused a loss to the company results in joint and several liability for all the
managing directors. A managing director who proves, however, that he or she
cannot be blamed for the improper performance of duties, taking into
consideration his or her work during the period in which he or she has been in
office, and that he or she was not negligent in his or her acts and/or took
steps to prevent the consequences of his or her acts, will not be deemed liable.
If, in the case of an involuntary liquidation of a company, the
managing directors are found by a court to have manifestly improperly managed
the company such that their management was the cause or a material cause of the
involuntary liquidation, each managing director of the company will be jointly
and severally liable to the bankruptcy estate of such company for any
liabilities of the company that cannot be discharged during the liquidation.
The Articles of Association of Fuel-Tech N.V. provide that, to the
fullest extent permitted by Netherlands Antilles laws, a managing director of
the corporation shall not be personally liable to the corporation or its
stockholders for monetary damages for breach of his or her fiduciary duty as a
managing director.
Under Delaware law, a corporation may include in its certificate of
incorporation a provision which would, subject to the limitations described
below, eliminate or limits director liability for monetary damages for breaches
of their fiduciary duty of care. Under Delaware law, a director's liability
cannot be eliminated or limited for (1) breaches of the duty of loyalty, (2)
acts or omissions not in good faith or that involve intentional misconduct or a
knowing violation of law, (3) the payment of unlawful dividends or expenditure
of funds for unlawful stock purchases or redemptions, or (4) transactions from
which such director derived an improper personal benefit. The proposed
certificate of incorporation of Fuel Tech Delaware limits a director's liability
to the fullest extent permitted by Delaware law.
INDEMNITY OF DIRECTORS
Under Netherlands Antilles law, in the event of an involuntary
liquidation of the company, a managing director will not be able to rely on a
discharge of liability granted to him or her by the company if certain claims
are
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instituted by the receiver in the involuntary liquidation. In such a case, the
managing director may also not be permitted to offset any claim against the
company.
Fuel-Tech N.V.'s articles of association provide that managing
directors and employees will be indemnified to the fullest extent permitted by
law, but that the corporation will not provide indemnification with respect to
any matter in which the managing director or employee has been found to not have
been acting in good faith and in the reasonable belief that such actions were in
the best interests of the corporation.
Delaware law provides that a corporation may indemnify a director,
officer, employee or agent of the corporation against expenses paid in
settlement actually and reasonably incurred by the person if such person acted
in good faith and in a manner he or she reasonably believed to be in or not
opposed to the best interests of the corporation. Fuel-Tech Delaware's proposed
certificate of incorporation provides that all directors and officers shall be
indemnified to the fullest extent permitted by Delaware law.
TRANSACTIONS INVOLVING DIRECTORS OR OFFICERS
By implication under Netherlands Antilles law there may be transactions
between a corporation and its managing directors or stockholders. In the event
of a conflict of interest between the corporation and a managing director, a
stockholder, or a supervisory director, if any, in any such transaction, the
general meeting of stockholders is at all times authorized to designate one or
more persons to act as special representative of the corporation, either on a
per incident basis or for a definite period of time.
A Delaware corporation may lend money to, or guarantee any obligation
incurred by, its directors or officers if in the judgment of the board such loan
or guarantee may reasonably be expected to benefit the corporation. However,
because Fuel-Tech N.V. is listed, and Fuel Tech Delaware will be listed, on the
Nasdaq Stock Market, they are subject to the Nasdaq rule prohibiting most loans
to directors and executive officers. With respect to any other contract or
transaction between the corporation and one or more of its directors or
officers, such transactions are neither void nor voidable solely for this reason
if either (1) the director's or officer's interest is made known to the
disinterested directors or the stockholders of the corporation, who thereafter
approve the transaction in good faith, or (2) the contract or transaction is
fair to the corporation as of the time it is approved or ratified by either the
board, a committee thereof or the stockholders.
MERGERS, CONSOLIDATIONS AND SALES OF ASSETS
Under Netherlands Antilles law, a Netherlands Antilles entity may be
converted into another Netherlands Antilles legal form, can be converted into a
foreign legal entity, or may merge with another legal entity, generally upon
approval by the entity's stockholders.
Under Delaware law, with certain exceptions, any merger, consolidation
or sale of all or substantially all of the corporation's assets must be approved
by the board of directors and a majority of the outstanding shares entitled to
vote.
INTERESTED STOCKHOLDERS TRANSACTIONS
Netherlands Antilles law is silent with respect to transactions with
interested stockholders, but please see the discussion above under
"--Transactions Involving Directors or Officers".
Delaware law prohibits transactions between a Delaware corporation and
an interested stockholder under certain circumstances. An interested stockholder
for this purpose is a stockholder who is directly or indirectly a beneficial
owner of 15% or more of the outstanding voting stock of the corporation. This
provision prohibits business combinations between an interested stockholder and
a corporation for a period of three years after the date such stockholder became
an interested stockholder unless (1) the business combination or transaction
which resulted in the stockholder becoming an interested stockholder is approved
by the corporation's board before such stockholder became an interested
stockholder, (2) the interested stockholder acquired at least 85% of the voting
stock of the corporation in the transaction in which such stockholder became an
interested stockholder, or (3) the business combination is approved by a
majority of the board and the affirmative vote of the holders of two-thirds of
14
the outstanding voting stock not owned by the interested stockholder at or
subsequent to the time that such stockholder became an interested stockholder.
These restrictions do not apply if, among other things, the corporation's
original certificate of incorporation contains a provision expressly electing
not to be governed by such law. Fuel Tech Delaware does not intend to opt out of
these provisions.
DISSOLUTION
Netherlands Antilles law provides that a corporation may be dissolved,
in certain circumstances, by a judge, at the request of an interested party or
the public prosecutor, at the request of the Chamber of Commerce through a court
order, or through a resolution providing for the dissolution, which is taken by
the general meeting of stockholders.
Under Delaware law, a corporation may voluntarily dissolve (1) if a
majority of the board adopts a resolution to that effect and the holders of a
majority of outstanding stock entitled to vote thereon vote for such
dissolution, (2) if all stockholders entitled to vote thereon consent in writing
to such dissolution, or (3) by judicial dissolution.
AMENDMENT TO THE ARTICLES OF INCORPORATION, CERTIFICATE OF
INCORPORATION, AND BYLAWS
Under Netherlands Antilles law, a corporation may amend its articles of
association by a vote of an absolute majority of shares outstanding and entitled
to vote.
Under Delaware law, an amendment to a corporation's certificate of
incorporation requires (1) adoption of a resolution by the board, and (2) the
affirmative vote of a majority of the outstanding shares entitled to vote
thereon. Delaware law also provides that the authority to adopt, amend or repeal
a corporation's bylaws is held exclusively by the stockholders unless that
authority is conferred upon the board in the certificate of incorporation. The
proposed certificate of incorporation of Fuel Tech Delaware permits the board to
adopt, amend or repeal any provision of the bylaws.
ANTI-TAKEOVER IMPLICATIONS
Delaware, like many other states, permits a corporation to adopt a
number of measures designed to reduce its vulnerability to unsolicited takeover
attempts. The reorganization is not being undertaken in order to prevent a
change in control, nor is it in response to any known attempt to acquire
majority stock ownership or Board representation.
In the discharge of its fiduciary obligations to our stockholders, our
Board of Directors has evaluated, and will continue to evaluate, our
vulnerability to potential unsolicited bidders, taking into consideration in the
future the adoption of certain defensive strategies designed to enhance the
Board's ability to negotiate with an unsolicited bidder. These strategies may
include, but are not limited to, the adoption of stockholder rights plan,
severance agreements for management and key employees that become effective upon
a change in control of Fuel Tech Delaware, and the issuance of preferred stock,
the rights and preferences of which are determined by the Board of Directors.
Neither Fuel-Tech N.V. nor Fuel Tech Delaware is currently authorized to issue
preferred stock. There is substantial judicial precedent in Delaware as to the
legal principles applicable to these measures and as to the assessment of the
conduct of boards of directors under the business judgment rule with respect to
unsolicited takeover attempts.
Some effects of the reorganization might be considered to have
anti-takeover implications. Section 203 of the Delaware General Corporation Law
restricts business combinations with interested stockholders for three years
following the date that a person becomes an interested stockholder, unless the
board of directors approves the business combination. Corporations may opt out
of the provisions of Section 203 and thus decline its potential anti-takeover
protection; however, Fuel Tech Delaware does not intend to do so. See
"Differences in Governing Corporate Law-Business Combinations/Reorganizations."
In addition, changes to the relative rights of stockholders and
management that have anti-takeover implications may be implemented under
Delaware law. These changes include the establishment of a staggered or
15
classified board of directors with a portion of directors elected each year for
multi-year terms, and the elimination of the ability of stockholders to act by
majority, rather than unanimous, written consent without a meeting. Our Board
has considered these alternatives and has determined not to provide for any of
these alternatives. For a discussion of these and other differences between the
laws of the Netherlands Antilles and Delaware, see "Differences in Governing
Corporate Law."
Notwithstanding that our Board has determined not to provide for the
various alternative anti-takeover measures described above, it nevertheless
continues to evaluate such measures and has determined not to opt out of
Delaware General Corporation Law Section 203. Our Board of Directors believes
that unsolicited takeover attempts, in addition to possibly causing serious
disruption to the business and management of Fuel Tech Delaware, might be unfair
or disadvantageous to Fuel Tech Delaware and its stockholders because a
non-negotiated takeover bid might:
o be timed to take advantage of temporarily depressed stock
prices;
o be designed to foreclose or minimize the possibility of more
favorable competing bids; and
o involve the acquisition of only a controlling interest in Fuel
Tech Delaware, without affording all stockholders the
opportunity to receive the same economic benefits.
By contrast, our Board of Directors believes that, by preserving the
process whereby an acquiror must negotiate with an independent Board of
Directors, the Board can and should take account of the underlying and long-term
values of assets, the possibilities for alternative transactions on more
favorable terms, possible advantages from a tax-free reorganization, anticipated
favorable developments in Fuel Tech Delaware's business not yet reflected in its
stock price and equal treatment of all stockholders.
GOVERNING DOCUMENTS
To change our place of domicile, we must file a certificate of
incorporation and a certificate of domestication with the Secretary of State of
the State of Delaware. The proposed certificate of incorporation and the
proposed bylaws of Fuel Tech Delaware are similar to the articles of association
of Fuel-Tech N.V. Following the change in our place of domicile, the rights of
our stockholders will be governed by the terms of the certificate of
incorporation and the bylaws that are attached as Appendix A and Appendix B,
respectively, to this prospectus. All stockholders are urged to read these
documents in their entirety.
TERMINATION
The reorganization may be terminated by action of the Board of Managing
Directors of Fuel-Tech N.V. and the reorganization abandoned at any time prior
to its completion.
EFFECTIVE TIME
The reorganization will be effected when the certificate of
incorporation of Fuel Tech Delaware and the certificate of domestication of
Fuel-Tech N.V. are filed with the Secretary of State of the State of Delaware.
We expect these filings to be effective on _____________, 2006.
EXPENSES OF THE REORGANIZATION
We will pay the expenses of the reorganization incurred by us and any
related transactions regardless of whether the reorganization is completed.
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FEDERAL INCOME TAX CONSEQUENCES OF THE REORGANIZATION
The following discussion summarizes the material United States federal
income tax consequences of the change in our place of incorporation. This
discussion is based upon the Internal Revenue Code of 1986, as amended (which we
refer to as the Code), the Treasury regulations promulgated thereunder, and
administrative rulings and court decisions in effect as of the date hereof, all
of which are subject to change, possibly with retroactive effect.
This discussion is, where noted, based on an opinion we have received
from Deloitte Tax LLP, which describes what the federal income tax consequences
of the reorganization should be, in their opinion. Deloitte Tax LLP's opinion is
not binding on Federal tax authorities, however, and Deloitte Tax LLP does not
warrant or guarantee the Federal income taxes consequences of the reorganization
In summary Deloitte Tax LLP believes that the reorganization should be tax-free
to Fuel-Tech N.V., Fuel Tech Delaware, and the stockholders of Fuel-Tech N.V.
This conclusion is based upon our belief that no shareholder should have an "all
earnings and profits" amount with respect to its Fuel-Tech N.V. stock based upon
the fact that we believe that Fuel Tech N.V. will not have current earnings and
profits (for the year that should end as of the domestication) and Fuel Tech
N.V. has never had any positive earnings and profits in any prior tax years.
Although we believe that Fuel Tech N.V. has correctly calculated its earnings
and profits, it is possible that the amount of Fuel-Tech N.V.'s earnings and
profits could be adjusted as a result of an IRS examination or an adjustment
between the IRS and a foreign taxing authority pursuant to procedures
established under a U.S. income tax treaty. Fuel-Tech, N.V. does not expect such
an adjustment, but if it were to occur, it could cause Fuel-Tech N.V. to have
positive earnings and profits in one or more of its tax years. As a result, a
shareholder could have an all earnings and profits amount with respect to its
Fuel-Tech N.V. stock, depending upon the period in which such shareholder held
its Fuel-Tech N.V. stock and the period in which that all earnings and profits
amount occurred and might be required to include income as a result. We believe
the likelihood of such an adjustment is remote.
This discussion does not address all aspects of United States federal
income taxation that might be relevant to a stockholder in light of the
stockholder's particular circumstances or to those stockholders subject to
special rules, such as stockholders who are financial institutions, tax-exempt
organizations, insurance companies or dealers in securities, stockholders who
acquired their stock pursuant to the exercise of options or similar derivative
securities or otherwise as compensation, or stockholders who hold their stock as
part of a straddle or conversion transaction, nor does it address any
consequences arising under the laws of any local, state or foreign jurisdiction
or under any treaty. This discussion assumes that stockholders hold their shares
of stock as capital assets within the meaning of Section 1221 of the Code. All
stockholders are urged to consult their own tax advisors as to the particular
tax consequences to them of the change in our place of incorporation.
GENERAL TAX CONSEQUENCES OF THE CHANGE IN OUR PLACE OF INCORPORATION
In the opinion of Deloitte Tax LLP, the change in our place of
incorporation should constitute a reorganization within the meaning of Section
368(a)(1)(F) of the Code and, as a result, should be tax-free to Fuel-Tech N.V.
and Fuel Tech Delaware. If the change in our place of incorporation were not a
tax-free reorganization, the tax consequences of the change in our place of
incorporation could differ from those described below. We do not plan to seek
any rulings from the IRS with respect to the change in our place of
incorporation.
In the opinion of Deloitte Tax LLP, except as described in the
discussions under the headings "--Tax Consequences to United States Persons" and
"--Tax Consequences to United States Persons if Fuel-Tech N.V. Is or Was a PFIC"
below, holders of our shares should not recognize any income, gain or loss for
federal income tax purposes solely as a result of the change in our place of
incorporation. Following the change in our place of incorporation, a holder of
our common stock should have a tax basis in the Fuel Tech Delaware common stock
equal to the tax basis such holder had in the shares before the change in our
place of incorporation (increased, in the case of any stockholder who recognizes
income, by the amount of such income). A stockholder's holding period with
respect to the Fuel Tech Delaware common stock should include the holding period
that such holder had in the shares before the change in our place of
incorporation.
17
TAX CONSEQUENCES TO UNITED STATES PERSONS
Subject to the discussion under the heading "--Tax Consequences to
United States Persons if Fuel-Tech N.V. Is or Was a PFIC" below, the federal
income tax consequences of our domestication for United States persons holding
our stock depend on the amount of our stock held. For these purposes, a "United
States person" is:
o an individual citizen or resident of the United States;
o a domestic partnership;
o a domestic corporation;
o any estate, other than a foreign estate; and
o any trust if a court within the United States is able to exercise
primary supervision over the administration of the trust and one or
more United States persons have the authority to control all
substantial decisions of the trust.
In the case of a foreign partnership, foreign trust or foreign estate
owning our stock, the partners and beneficiaries thereof are considered to own
their proportionate share of our stock for these purposes.
A United States person who is a stockholder of Fuel-Tech N.V. will fit
within one of three categories based on his or her ownership of our stock. The
federal income tax consequences of the domestication to a United States person
will depend on which category the stockholder is within.
First, a United States person who on the date of the reorganization
beneficially owns 10% or more of the voting power of our stock is required to
include in income as a dividend the allocable share of our "all earnings and
profits amount." To the extent of this income inclusion, the United States
stockholder is permitted to increase basis in the stock received in the
exchange. However, because we believe that we have not had positive earnings and
profits in any tax year (including the tax year that should end as of the date
of the domestication), we expect that the all earnings and profits amount with
respect to each shareholder's Fuel-Tech N.V. stock will be zero. If the all
earnings and profits amount with respect to any shareholder's stock is in fact
zero, then in the opinion of Deloitte Tax LLP such United States stockholder in
this ownership category should recognize no income or loss upon our
domestication.
Second, a United States person who on the date of the reorganization
does not beneficially own 10% or more of the voting power of our stock but does
actually own our stock having a fair market value of $50,000 or more will
recognize gain, but not loss, on the exchange of stock of Fuel-Tech N.V. for
stock of Fuel Tech Delaware to the extent that the fair market value of the Fuel
Tech Delaware stock received exceeds the stockholder's tax basis in the stock of
Fuel-Tech N.V. exchanged, unless the stockholder elects to include in its income
as a dividend its portion of the all earnings and profits amount with respect to
its Fuel-Tech N.V. stock. In connection with this election, Fuel Tech Delaware
will provide the exchanging stockholder with information to substantiate the all
earnings and profits amount, and the stockholder must comply with the
requirements of Treasury Regulation Section 1.367(b)-1(c). Under Treasury
Regulation Section 1.367(b)-1(c), the stockholder must attach a notice to its
timely filed federal income tax return for the year of the exchange, which
includes: (1) a statement that the exchange is a Section 367(b) exchange; (2) a
complete description of the exchange; (3) a description of any stock or
securities or other consideration transferred or received in the exchange; (4) a
statement of the all earnings and profits amount that is required to be taken
into income as a dividend; and (5) certain other information specified in the
Treasury Regulations under Treasury Regulation Section 1.367(b). In addition,
the notice must include (A) a statement that the stockholder is making the
election described in Treasury Regulation Section 1.367(b)-3(c)(3); and (B) a
representation that the stockholder has given the requisite notice to Fuel Tech
Delaware. The stockholder must send notification that he or she is making the
election described in Treasury Regulation Section 1.367(b)-3(c)(3) to Fuel Tech
Delaware on or before the date of filing of such stockholder's federal income
tax return in which the election is made.
Because we believe that Fuel-Tech N.V. has never had positive earnings
and profits in any tax year, we would expect that each shareholder's earnings
and profits amount with respect to its Fuel-Tech N.V. stock should be zero, and
thus, the making of an election to include the person's share of the all
earnings and profits amount into income as a dividend generally would be
advantageous to United States persons who would otherwise recognize gain with
respect to the exchange of our stock in the domestication transaction. WE
STRONGLY URGE EACH
18
UNITED STATES PERSON DESCRIBED IN THIS PARAGRAPH TO CONSULT WITH HIS OR HER TAX
ADVISOR REGARDING THE MANNER AND ADVISABILITY OF MAKING THE ELECTION UNDER
TREASURY REGULATIONS PROMULGATED UNDER SECTION 367(B) OF THE CODE TO INCLUDE IN
INCOME THE ALLOCABLE SHARE OF THE ALL EARNINGS AND PROFITS AMOUNT OF FUEL-TECH
N.V. IN LIEU OF RECOGNIZING GAIN. If you are such a person, we plan to send you
more information, including a notice substantiating the all earnings and profits
amount and a form for your filing, after the reorganization is completed, but
the filing is your responsibility. If a United States stockholder in this
ownership category makes such a filing, then provided Fuel-Tech N.V. has not had
positive earnings and profits in any prior tax years and provided it does not
have current earnings and profits, in the opinion of Deloitte Tax LLP such
stockholder should recognize no income or loss upon our domestication.
Third, in the opinion of Deloitte Tax a United States person who on the
date of the reorganization actually owns our stock having a fair market value of
less than $50,000 and who does not own beneficially 10% or more of the voting
power of our stock should recognize no gain or loss in the reorganization.
TAX CONSEQUENCES TO UNITED STATES PERSONS IF FUEL-TECH N.V. IS OR WAS
A PFIC
In addition to the discussions under the heading "--Tax Consequences to
United States Persons" above, the change in our place of incorporation might be
a taxable event to stockholders that are United States persons if we are or were
ever a passive foreign investment company, or PFIC, under Section 1297 of the
Code, provided that Section 1291(f) of the Code is currently effective.
Generally, a foreign corporation is a PFIC if 75% or more of its gross
income for a taxable year is passive income or if 50% or more of the value of
its assets held by the corporation during a taxable year produce or are held to
produce passive income. Passive income includes dividends, interest, rents and
royalties, but excludes rents and royalties that are derived in the active
conduct of a trade or business and that are received from an unrelated person,
as well as interest, dividends, rents and royalties received from a related
person that are allocable to income of such related person other than passive
income. For purposes of these rules, Fuel-Tech N.V. would be considered to own
the assets of and recognize the income of any subsidiary corporations as to
which it owns 25% or more of the value of their outstanding stock, in proportion
to such ownership. If a foreign corporation is classified as a PFIC for any
taxable year during which a United States person owns stock in the foreign
corporation, the foreign corporation generally remains thereafter classified as
a PFIC with respect to that stockholder. Fuel-Tech N.V. believes that it is not
and has never been a PFIC. Accordingly, the change in our place of incorporation
should not be a taxable event for any stockholder based on an application of the
PFIC rules. However, the determination of whether a foreign corporation is a
PFIC is primarily factual and there is little administrative or judicial
authority on which to rely to make a determination. Hence, the IRS may not agree
that Fuel-Tech N.V. is not a PFIC.
Section 1291(f) of the Code generally requires that, to the extent
provided in regulations, a United States person who disposes of stock of a PFIC
recognizes gain notwithstanding any other provision of the Code. No final
Treasury Regulations have been promulgated under this statute. Proposed Treasury
Regulations were promulgated in 1992 with a retroactive effective date. If
finalized in their current form, these regulations would generally require gain
recognition by a United States person exchanging stock of Fuel-Tech N.V. for
stock of Fuel Tech Delaware, if Fuel-Tech N.V. were classified as a PFIC at any
time during such United States person's holding period in such stock and such
person has not made a timely election to treat Fuel-Tech N.V. as a qualified
electing fund under Section 1295 of the Code and to have thus agreed to be taxed
currently on its share of our earnings and profits. The tax on any such gain so
recognized would be imposed at the rate applicable to ordinary income and an
interest charge would apply based on a complex set of computational rules
designed to offset the tax deferral to such stockholders on our undistributed
earnings. However, it is impossible to predict at this time whether, in what
form, and with what effective date, final Treasury Regulations under Section
1291(f) will be adopted.
FUTURE INCOME OF FUEL TECH DELAWARE AND CERTAIN FOREIGN SUBSIDIARIES
SUBJECT TO UNITED STATES FEDERAL INCOME TAX
The change in our place of incorporation will likely result in a
greater portion of our earnings being subject to United States federal income
tax than is currently the case and might therefore subject us to a higher
effective overall income tax rate. Specifically, as non-United States persons,
Fuel-Tech N.V. and its foreign subsidiaries have
19
generally not been subject to tax in the United States on their income derived
from sources outside the United States. Following the change in our place of
incorporation, however, Fuel Tech Delaware will be subject to United States
federal income tax on our worldwide income. In addition, if we have foreign
subsidiaries meeting the definition of a controlled foreign corporation, the
subpart F income of such foreign subsidiaries will be allocated among the
stockholders of the foreign subsidiaries and taxed in allocable part to the
United States stockholders of the subsidiaries (including Fuel Tech Delaware),
even if such stockholders do not receive any cash from the subsidiaries.
EACH STOCKHOLDER SHOULD CONSULT HIS, HER OR ITS OWN TAX ADVISOR
REGARDING THE PARTICULAR FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF
PURCHASING, HOLDING OR DISPOSING OF OUR SHARES OF COMMON STOCK, INCLUDING THE
CONSEQUENCES OF ANY PROPOSED CHANGE IN APPLICABLE LAWS.
20
ACCOUNTING TREATMENT OF THE REORGANIZATION
There will be no accounting effect or change in the carrying amount of
the assets and liabilities of Fuel-Tech N.V. as a result of reorganization. The
consolidated capitalization, assets, liabilities and financial statements of
Fuel Tech Delaware immediately following the reorganization will be the same as
those of Fuel-Tech N.V. immediately prior to the reorganization.
RESTRICTIONS ON RESALE OF FUEL TECH DELAWARE COMMON STOCK
The shares of Fuel Tech Delaware common stock to be issued in the
reorganization have been registered under the Securities Act of 1933, as
amended, or the Securities Act. Persons who are not affiliates of Fuel Tech
Delaware may resell their shares of Fuel Tech Delaware common stock without
restriction. Generally, you are an affiliate of Fuel-Tech N.V. or Fuel Tech
Delaware if you are a director or executive officer of either company or own 10%
or more of the outstanding common stock of either company. Under current law,
any reoffering or sale of such shares by any person who is an affiliate of Fuel
Tech Delaware will require either (1) the further registration of such shares
under the Securities Act, (2) compliance with Rule 145 promulgated under the
Securities Act, which permits sales under certain conditions, as discussed
below, or (3) the availability of another exemption from further registration.
In general, under Rule 145, assuming that a person is, at the time of
sale, an affiliate of Fuel Tech Delaware, that person may sell such stock if the
person:
o sells during any three-month period no more than the number of shares
permitted under Rule 144(e), which is the greater of (1) 1% of the
total number of shares of Fuel Tech Delaware common stock outstanding,
or (2) the average weekly volume of trading of Fuel Tech Delaware
common stock for the four calendar weeks prior to the sale;
o sells in a brokers' transaction, which means, generally, that the
broker can do no more than execute the order as agent for the seller,
can receive no more than the usual broker's commission, cannot solicit
orders to buy in connection with the transaction, and cannot believe
that the seller is an underwriter of the securities being sold;
o does not solicit orders to buy in connection with the transaction and
does not make any payment in connection with such sale to anyone other
than the selling broker; and
o sells at a time when there is adequate current public information about
Fuel Tech Delaware, which will be satisfied so long as Fuel Tech
Delaware common stock remains registered under the Exchange Act and
Fuel Tech Delaware continues to file the necessary reports under the
Exchange Act.
21
DESCRIPTION OF CAPITAL STOCK
Our authorized capital consists of 40,000,000 shares of common stock,
$0.01 par value per share.
As of May 31, 2006 there were approximately 21,669,407 shares of our
common stock issued and outstanding that were held of record by ___ persons and
beneficially by approximately ________ persons. After the reorganization is
effected, we expect that the same number of shares of common stock of Fuel Tech
Delaware will be outstanding.
COMMON STOCK
Each holder of record of common stock is entitled to one vote for each
share held on all matters properly submitted to a vote of stockholders. Holders
of outstanding shares of common stock are entitled to those dividends declared
by our Board of Directors out of legally available funds, and, in the event of
liquidation, dissolution or winding up of our affairs, holders are entitled to
receive ratably our net assets available to the stockholders. Cumulative voting
in the election of directors is not authorized. Holders of outstanding shares of
common stock have no preemptive, conversion or redemption rights. All of the
issued and outstanding shares of common stock are, and all unissued common
stock, when offered and sold will be, duly authorized, validly issued, fully
paid and nonassessable. To the extent that additional common stock of ours may
be issued in the future, the relative interests of the then existing
stockholders may be diluted.
TRANSFER AGENT AND REGISTRAR
The transfer agent for the common stock of Fuel-Tech N.V. is, and of
Fuel Tech Delaware after the reorganization will be, Mellon Investor Services,
LLC.
22
DOCUMENTS INCORPORATED BY REFERENCE
The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with it, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is considered to be part of this
prospectus, and information that we file later with the Securities and Exchange
Commission will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filings we
will make with the Securities and Exchange Commission under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended:
o Annual Report on Form 10-K for the year ended December 31, 2005;
o Quarterly Report on Form 10-Q for the quarter ended March 31,
2006;
o Current Reports on Form 8-K, dated February 28, 2006 and April 5,
2006;
o Proxy Statement dated April 21, 2006; and
o The description of our stock contained in our registration
statements filed pursuant to Section 12 of the Exchange Act, as
amended from time to time.
You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address:
Fuel Tech, Inc.
Attn: Investor Relations
695 East Main Street
Stamford, Connecticut 06901
Phone: (203) 425-9830
Toll-Free: (800) 887-3835
Fax: (203) 425-9823
23
LEGAL MATTERS
The validity of the shares of common stock of Fuel Tech Delaware to be
issued in the reorganization has been passed upon for Fuel Tech Delaware by Finn
Dixon & Herling LLP, Stamford, Connecticut.
TAX MATTERS
The federal income tax consequences of the reorganization to Fuel-Tech
N.V. and Fuel Tech Delaware have been opined upon by Deloitte Tax LLP.
EXPERTS
Ernst & Young LLP, an independent registered public accounting firm,
has audited our consolidated financial statements and schedule included in our
Annual Report on Form 10-K for the year ended December 31, 2005, and
management's assessment of the effectiveness of our internal control over
financial reporting as of December 31, 2005, as set forth in their reports,
which are incorporated by reference in this prospectus and elsewhere in the
registration statement. Our financial statements and schedule and management's
assessment are incorporated by reference in reliance on Ernst & Young LLP's
reports, given on their authority as experts in accounting and auditing.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
We file, and after the reorganization we will continue to file, annual,
quarterly and current reports, proxy statements, and other information with the
Securities and Exchange Commission. You may read and copy these reports,
statement or other information we file at the Securities and Exchange
Commission's Public Reference Rooms at 100 F Street, N.E., Room 1024,
Washington, D.C. 20549. You may obtain information on the operation of the
Public Reference Room by calling the Securities and Exchange Commission at
1-800-SEC-0330. The Securities and Exchange Commission maintains an Internet
site that contains reports, proxy and information statements, and other
information about issuers that file electronically with the Securities and
Exchange Commission. The address of that site is http://www.sec.gov.
Fuel-Tech N.V. filed a registration statement with the SEC under the
Securities Act of 1933, as amended, relating to the Fuel Tech Delaware common
stock offered to the Fuel-Tech N.V. stockholders. The registration statement
contains additional information about the reorganization, Fuel Tech Delaware and
the Fuel Tech Delaware common stock. The Securities and Exchange Commission
allows Fuel-Tech N.V. to omit certain information included in the registration
statement from this prospectus. The registration statement may be inspected and
copied at the Securities and Exchange Commission public reference facilities
described above.
24
APPENDIX A
CERTIFICATE OF INCORPORATION
OF
FUEL TECH, INC.
1. The name of the corporation is Fuel Tech, Inc.
2. The corporation's original certificate of incorporation was filed on
June 19, 1987, under the name "Fuel-Tech N.V." in the Netherlands
Antilles.
3. The address of its registered office in the State of Delaware is
Corporation Trust Center, 1209 Orange Street, in the city of
Wilmington, County of New Castle. The name of its registered agent at
such address is The Corporation Trust Company.
4. The nature of the business or purpose to be conducted or promoted is to
engage in any lawful act or activity for which corporations may be
organized under the General Corporation law of Delaware.
5. The corporation shall have authority to issue the total number of Forty
Million (40,000,000) shares of the par value of $0.01 per share,
amounting in the aggregate to Four Hundred Thousand Dollars
($400,000.00), and of such shares Forty Million (40,000,000) shall be
designated as common stock.
6. In furtherance and not in limitation of the powers conferred by
statute, the Board of Directors is expressly authorized to make, alter,
amend, rescind or repeal the by-laws of the corporation.
7. Elections of Directors need not be by written ballot unless the by-laws
of the corporation shall so provide.
8. Meetings of stockholders may be held within or without the state of
Delaware, as the by-laws may provide. The books of the corporation may
be kept outside of the State of Delaware at such place or places as may
be designed from time to time by the board of directors or in the
by-laws of the corporation.
9. (a) A director of the corporation shall not be personally liable
to the corporation or its stockholders for monetary damages
for breach of fiduciary duty as a director except that this
Article 9 shall not eliminate or limit a director's liability
(i) for any breach of the director's duty of loyalty to the
corporation or its stockholders, (ii) for acts or omissions
not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the
Delaware General Corporation law, or (iv) for any transaction
from which the director derived an improper personal benefit.
(b) If the Delaware General Corporation Law is amended after
approval by the stockholders of this Article 9 to authorize
corporate action further eliminating or limiting the personal
liability of directors, then the liability of a director of
the corporation shall be eliminated or limited to the fullest
extent permitted by the Delaware General Corporation Law, as
so amended from time to time.
(c) Any repeal or modification of this Article 9 shall not
increase the personal liability of any director of this
corporation for any act or occurrence taking place prior to
such repeal or modification, or otherwise adversely affecting
any right or protection of a director of the corporation
existing at the time of such repeal or modification.
10. (a) Except as otherwise provided below, the corporation shall, to
the fullest extent permitted by law, indemnify each person who
is, or shall have been, a director or officer of the
corporation or who is or was a director or officer of the
corporation and is serving, or shall have served, at the
request of the corporation, as a director, officer, employee
or agent of another organization or in any capacity with
respect to any employee benefit plan of the corporation,
against all liabilities and expenses (including judgments,
fines, penalties, amounts paid or to be paid in settlement,
and reasonable
A-1
attorneys fees) imposed upon or incurred by any such person
(the "Indemnitee") in connection with, or arising out of, the
defense of disposition of any action, suit or other
proceeding, whether civil or criminal, in which he may be a
defendant or with which he may be threatened or otherwise
involved, directly or indirectly, by reason of his being or
having been such a director, officer, employee or agent or as
a result of his serving or having served with respect to any
such employee benefit plan; provided, however, that the
corporation shall provide no indemnification with respect to
any matter as to which any such Indemnitee shall be finally
adjudicated in such action suit or proceeding not to have
acted in good faith in the reasonable belief that his action
was (i) in the best interests of the corporation or (ii) to
the extent such matter relates to service with respect to an
employee benefit plan, in the best interests of the
participants or beneficiaries of such employee benefit plan;
and, provided further, that, except as provided in section (c)
of this Article 10, the corporation shall indemnify any such
person seeking indemnification in connection with a proceeding
initiated by such person only if such person was authorized to
initiate such proceeding by the board of directors of the
corporation. The right to indemnification conferred in this
Article 10 shall be a contract right and, subject to Sections
(c) and (i) of this Article 10, shall include the right to be
paid by the corporation expenses incurred in defending any
such proceeding in advance of its final disposition. The
corporation may, by action of its board of directors, provide
indemnification to employees and agents of the corporation
with the same scope and effect as the foregoing
indemnification of officers and directors.
(b) The right to indemnification conferred in this Article 10
shall include the right to be paid by the corporation for
liabilities and expenses incurred in connection with the
settlement or compromise of any such action, suit or
proceeding, pursuant to a consent decree or otherwise, unless
a determination is made, within thirty-five (35) days after
receipt by the corporation of a written request by the
Indemnitee for indemnification, that such settlement or
compromise is not in the best interests of the corporation or,
to the extent such matter related to service with respect to
an employee benefit plan, that such settlement or compromise
is not in the best interests of the participants or
beneficiaries of such plan. Any such determination shall be
made (i) by the board of directors of the corporation by a
majority vote of a quorum consisting of disinterested
directors, or (ii) if such quorum is not obtainable, by a
majority of the disinterested directors then in office.
Notwithstanding the foregoing, if there are less than two (2)
disinterested directors of the corporation then in office, the
board of directors shall promptly direct that independent
legal counsel (who may be regular legal counsel to the
corporation) determine, based on facts known to such counsel
at such time, whether such Indemnitee acted in good faith in
the reasonable belief that his action was in the best
interests of the corporation or the participants or
beneficiaries of any such employee benefit plan, as the case
may be; and, in such event, indemnification shall be made to
such Indemnitee unless, within thirty-five (35) days after
receipt by the corporation of the request by such Indemnitee
for indemnification, such independent legal counsel provides
in a written opinion to the corporation that such Indemnitee
did not act in good faith in the reasonable belief that his
action was in the best interests of the corporation or the
participants or beneficiaries of any such employee benefit
plan, as the case may be.
(c) Any indemnification of a director or officer of the
corporation under this Article 10, including any advance of
expenses under Section (e) of this Article 10, shall be made
promptly and, in any event, within thirty-five (35) days, upon
the written request of the director or officer. If a
determination by the corporation that the director or officer
is entitled to indemnification pursuant to this Article 10 is
required, and the corporation fails to respond within sixty
(60) days to a written request for indemnity, the corporation
shall be deemed to have approved the request. If the
corporation denies a written request for indemnification or
advancing of expenses, in whole or in part, or if payment in
full pursuant to such request is not made within thirty-five
(35) days, the right to indemnification or advances as granted
by this Article 10 shall be enforceable by the director or
officer in any court of competent jurisdiction. Such person's
costs and expenses incurred in such action shall also be
indemnified by the corporation if such person prevails in such
action. It shall be a defense to any such action (other than
an action to enforce a claim for expenses incurred in
defending any proceeding in advance of its final disposition
where the required undertaking, if any, has been tendered to
the corporation) that the claimant has not met the
A-2
standards of conduct which make it permissible under the
General Corporation Law of the State of Delaware for the
corporation to indemnify the claimant for the amount claimed
but the burden of such defense shall be on the corporation.
Neither the failure of the corporation (including its board of
directors, independent legal counsel, or its stockholders) to
have made a determination prior to the commencement of such
action that indemnification of the claimant is proper in the
circumstances because he has met the applicable standard of
conduct set forth in the General Corporation Law of the State
of Delaware, nor an actual determination by the corporation
(including its board of directors, independent legal counsel,
or its stockholders) that the claimant has not met such
applicable standard of conduct, shall be a defense to the
action or create a presumption that the claimant has not met
the applicable standard of conduct.
(d) As a condition precedent to his right to be indemnified, the
Indemnitee must give the corporation notice in writing as soon
as practicable of any action, suit or proceeding involving him
for which indemnity will or could be sought. With respect to
any action, suit or proceeding of which the corporation is
notified, the corporation will be entitled to participate
therein at its own expense and/or to assume the defense
thereof at its own expense, with legal counsel reasonably
acceptable to such Indemnitee. After notice from the
corporation to the Indemnitee of its election to assume such
defense, the corporation shall not be liable to such
Indemnitee for any legal or other expenses subsequently
incurred by such Indemnitee in connection with such claim, but
the fees and expense of such counsel incurred after notice
from the corporation of its assumption of the defense thereof
shall be at the expense of the Indemnitee unless (i) the
employment of counsel by the Indemnitee has been authorized by
the corporation, (ii) counsel to the Indemnitee shall have
reasonably concluded that there may be a conflict of interest
or position on any significant issue between the corporation
and the Indemnitee in the conduct of the defense of such
action or (iii) the corporation shall not in fact have
employed counsel to assume the defense of such action, in each
of which cases, the fees and expenses of counsel for the
Indemnitee shall be at the expense of the corporation, except
as otherwise expressly provided by this Article. The
corporation shall not be entitled to assume the defense of any
claim brought by or on behalf of the corporation or as to
which counsel for the Indemnitee shall have reasonably made
the conclusion provided for in (ii) above.
(e) Subject to paragraph 10(c) above, the right to indemnification
referred to in this Article shall include the right to be paid
by the corporation for expenses (including reasonable
attorneys' fees) incurred in defending a civil or criminal
action, suit or proceeding in advance of its final
disposition, subject to receipt of an undertaking by the
Indemnitee to repay such payment if it is ultimately
determined that the Indemnitee is not entitled to
indemnification under this Article. Such undertaking may be
accepted without reference to the financial ability of such
Indemnitee to make such repayment. Notwithstanding the
foregoing, no advance shall be made by the corporation under
this paragraph (d) if a determination is reasonably and
promptly made by the board of directors by a majority vote of
a quorum consisting of disinterested directors or, if such
quorum is not obtainable, by a majority of the disinterested
directors of the corporation then in office or, if there are
not at least two disinterested directors then in office, by
independent legal counsel (who may be regular legal counsel to
the corporation) in written opinion that, based on facts known
to the board of directors or counsel at such time, such
Indemnitee did not act in good faith in the reasonable belief
that his action was in the best interests of the corporation
or the participants or beneficiaries of an employee benefit
plan of the corporation, as the case may be.
(f) If an Indemnitee is entitled under any provision of this
Article to indemnification by the corporation of some or a
portion of the liabilities or expenses imposed upon or
incurred by such Indemnitee in the investigation, defense,
appeal or settlement of any action, suit or proceeding but
not, however, for the total amount thereof, the corporation
shall nevertheless indemnify the Indemnitee for the portion of
such liabilities or expenses to which such Indemnitee is
entitled.
(g) The right to indemnification and the payment of expenses
incurred in defending any action, suit or proceeding in
advance of its final disposition conferred in this Article
shall not be exclusive of any other right which any person may
have or thereafter acquire under any statute, provision of the
A-3
articles of incorporation, by-laws, agreement, vote of
stockholders or board of directors or otherwise. Without
limiting the generality of the foregoing, the corporation,
acting through its board of directors, may enter into
agreements with any director or employee of the corporation
providing for indemnification rights equivalent to or greater
than the indemnification rights set forth in this Article.
(h) The corporation may purchase and maintain insurance, at its
expense, to protect itself and any director or employee of the
corporation or another organization or employee benefit plan
against any expense or liability incurred by him or it in any
such capacity, or arising out of the status as such.
(i) The corporation's obligation to provide indemnification under
this Article shall be offset to the extent of any other source
of indemnification or any otherwise applicable insurance
coverage under a policy maintained by the corporation or any
other person.
(j) Without the consent of a person entitled to the
indemnification and other rights provided in this Article, no
amendment modifying or terminating such rights shall adversely
affect such person's rights under this Article with respect to
the period prior to such amendment.
(k) If this Article or any portion thereof shall be invalidated on
any ground by any court of competent jurisdiction, then the
corporation shall nevertheless indemnify each Indemnitee as to
any liabilities and expenses with respect to any action, suit
or proceeding to the full extent permitted by any applicable
portion of this Article that shall not have been invalidated
and to the full extent permitted by applicable law.
(l) As used in this Article, the terms "director," "officer,"
"employee," "agent," and "person" include their respective
successors, heirs, executors, administrators and legal
representatives and an "interested" director is one against
whom in such capacity the proceedings in question or another
proceeding on the same or similar grounds is then pending.
11. The corporation reserves the right to amend, alter, change or repeal
any provision contained in this certificate of incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred
upon stockholders herein are granted subject to this reservation.
THE UNDERSIGNED duly authorized officer of the corporation does hereby
set his hand this ______ day of ______, 2006.
-------------------------
Incorporator
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APPENDIX B
Fuel Tech, Inc.
A Delaware Corporation
BY-LAWS
As Adopted , 2006
ARTICLE I
OFFICES
Section 1.1. Registered Office. The Corporation's registered
office shall be in the City of Wilmington, County of New Castle, State of
Delaware.
Section 1.2. Other Offices. The Corporation may also have
offices at such other places within or without the State of Delaware as the
Board of Directors shall determine or the business of the Corporation may
require.
ARTICLE II
STOCKHOLDERS MEETINGS
Section 2.1. Place of Meeting. Meetings of stockholders may be
held at such places within or without the State of Delaware as the Board of
Directors shall determine.
Section 2.2 Annual and Special Meetings. Annual meetings of
stockholders shall be held at dates, times, and places fixed by the Board of
Directors and stated in the notice of meeting to elect Directors and to transact
such other business as may properly come before the meeting. Special meetings of
stockholders for any proper purpose or purposes may be called at any time by the
Board of Directors, the Chairman, or the Chief Executive Officer at such date,
time and place as the Board of Directors shall determine. If requested in
writing by the holders of not less than a majority of the Corporation's then
outstanding capital stock specifying the purpose or purposes of the meeting and
delivered to the Chairman or Chief Executive Officer or the Secretary, special
meetings of stockholders shall be called by the Chairman, the Chief Executive
Officer or the Secretary. Only such business as is specified in the notice of
any special meeting of the stockholders shall come before a special meeting. If
a special meeting is properly called by the stockholders, the Board of Directors
shall determine the time and place of such special meeting, which shall be held
not less than thirty-five (35) nor more than one hundred twenty (120) days after
the date of receipt of the request.
Section 2.3. Stockholders List. The Secretary of the
Corporation shall or shall cause the Corporation's Transfer Agent to prepare, at
least ten (10) days before every meeting of stockholders, a complete list of the
stockholders entitled to vote at the meeting. Such list shall be arranged in
alphabetical order and shall show each stockholder's address and the number of
shares registered in such stockholder's name. Such list shall be open to
examination by any stockholder for any purpose germane to the meeting during
ordinary business hours, for a period of at least ten (10) days prior to the
meeting, either at a place within the city where the meeting is to be held,
which place shall be specified in the notice of the meeting (or, if not so
specified, at the place where the meeting is to be held). The list shall be
produced and kept at the time and place of the meeting during the whole time
thereof, and may be inspected by any stockholder who is present.
Section 2.4. Organization. The Chairman of the Board, if there
shall be an incumbent Chairman of the Board, or, otherwise the person designated
by the Board of Directors, or, in the absence of such designation, the highest
ranking officer of the Corporation who is present at the meeting, shall call to
order meetings of stockholders and shall act as chairman of such meetings. The
Secretary of the Corporation shall act as secretary of meetings of stockholders.
If the Secretary of the Corporation is absent from the meeting, the secretary of
the meeting shall be such person as the chairman of the meeting shall appoint.
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Section 2.5. Conduct of Business. The chairman of any meeting
of stockholders shall determine the order of business and the procedures to be
followed at the meeting, including regulation of the manner of voting and of the
conduct of discussion.
Section 2.6. Notice. Except as otherwise provided by law,
written notice of the time, date, and place of meeting (and, in the case of a
special meeting, the purpose thereof) shall be given to each stockholder not
less than ten (10) days and not more than sixty (60) days before the date on
which the meeting is to be held.
Section 2.7. Quorum. Except as otherwise required by law or
the certificate of incorporation, at any meeting of stockholders, the holders of
record (present in person or by proxy) of one-third of the shares of capital
stock entitled to vote at the meeting shall constitute a quorum for the
transaction of business, In the absence of a quorum, the chairman or secretary
of the meeting may adjourn the meeting in the manner provided in Section 2.8
hereof until a quorum is present.
Section 2.8. Adjournment. Any meeting of stockholders, annual
or special, may be adjourned from time to time to reconvene at the same place or
another place. A determination in accordance with Article V hereof of
stockholders of record with respect to a meeting of stockholders shall apply to
any adjournment of such meeting; provided, however, that the Board of Directors
shall have authority to fix a new record date for the adjourned meeting. Notice
need not be given of any such adjourned meeting, if the date, time, and place
thereof are announced at the meeting at which the adjournment is taken;
provided, however, that if the adjournment is for more than thirty (30) days or
if a new record date is fixed for the adjourned meeting, written notice of the
date, time, and place of the adjourned meeting shall be given to each
stockholder of record entitled to vote at the adjourned meeting. At the
adjourned meeting, any business may be transacted which might have been
transacted at the original meeting.
Section 2.9. Proxies and Voting. At any meeting of
stockholders, each stockholder entitled to vote may vote in person or by proxy.
Each stockholder shall have one vote for each share of capital stock entitled to
vote which is registered in his name on the record date for the meeting, except
as otherwise provided in these By-Laws or as otherwise required by law. All
voting by stockholders, except on the election of directors and except as
otherwise required by law, may be by voice vote; provided, however, that upon
demand therefor by a stockholder (or by his proxy) entitled to vote, a stock
vote shall be taken. Each stock vote shall be taken by written ballot, each of
which shall state the name of the stockholder (or proxy) voting. Each vote taken
by ballot shall be counted by an inspector or inspectors appointed by the
chairman of the meeting. Elections of Directors shall be determined by a
plurality of the votes cast; except as otherwise required by law, all other
matters shall be determined by a majority of votes cast.
Section 2.10 Consent of Stockholders in Lieu of Meeting
Nothing contained in these By-Laws shall be deemed to restrict the power of the
stockholders to take any action by means of a consent or consents in writing
according to applicable law.
ARTICLE III
DIRECTORS
Section 3.1 General Powers. Except as may otherwise be
provided by law, the Certificate of Incorporation or these By-Laws, the business
and affairs of the Corporation shall be managed by or under the direction of the
Board of Directors and the Board of Directors may exercise all of the powers of
the Corporation.
Section 3.2 Number, Election, Term, and Removal of Directors.
Except as otherwise provided in these By-Laws or as otherwise required by law,
each Director shall be elected until a successor is duly elected or until the
Director shall sooner resign, retire, become deceased or be removed as provided
below. The first Board of Directors shall consist of nine (9) Directors.
Thereafter, the number of Directors shall be determined by the Board of
Directors or by the
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stockholders. The Directors shall all be elected by the stockholders in
accordance with Section 2.9 hereof at the annual meeting of stockholders.
Vacancies and newly created directorships resulting from an increase in the
number of Directors may be filled (for the unexpired term and until a successor
Director is elected) by a majority of the Directors then in office (although
less than a quorum), by the sole remaining Director, or by the stockholders. Any
Director may be removed with or without cause by the stockholders at any time.
Any Director may resign at any time by submitting an electronic transmission or
by delivering a written notice of resignation, signed by such Director, to the
Chairman, the Chief Executive Officer or the Secretary. Unless otherwise
specified therein, such resignation shall take effect upon delivery.
Section 3.3 Nomination of Director Candidates. In addition to
any other applicable requirements, only persons who are nominated in accordance
with the following procedures shall be eligible for election as Directors at the
Annual Meeting. Nominations of persons for election to the Board of Directors of
the Corporation may be made at a meeting of stockholders by or at the direction
of the Board of Directors, a nominating committee of the Board of Directors, a
person appointed by the Board of Directors, or by any stockholder of the
Corporation (i) who is a stockholder of record on the date of the giving of the
notice provided in this Section 3.3 and on the record date for determination of
stockholders entitled to vote at such Annual Meeting and (ii) who timely
complies with the notice provisions of this Section 3.3. Such nominations, other
than those made by or at the direction of the Board of Directors, shall be made
pursuant to notice in writing to the Secretary of the Corporation delivered to
or mailed and received by the Secretary not later than January 1 in the year of
the respective Annual Meeting. Such stockholder's notice shall set forth (a) as
to each person whom the stockholder proposes to nominate for election or
reelection as a Director, (i) the name, age, business address and residence
address of the person, (ii) the principal occupations or employments of the
person currently and for the prior five years, (iii) the class and number of
shares of the Corporation's capital stock owned beneficially or of record by the
person, (iv) a statement signed by the person that such person consents to being
named as a nominee, and, if elected, the person intends to serve as a Director;
and (b) as to the stockholder giving the notice, (i) the name and record address
of the stockholder, (ii) the class and number of shares of capital stock of the
Corporation owned beneficially or of record by the stockholder (iii) a
description of all arrangements or understandings between the person proposed as
a nominee and the stockholder and any other persons including their names, and
(iv) a representation signed by the stockholder that the stockholder intends to
appear in person or by proxy at the Annual Meeting to nominate the persons named
in the notice. The Corporation may require any proposed nominee to furnish such
other information as may reasonably be required by the Corporation to determine
the eligibility of the proposed nominee to serve as a Director of the
Corporation. Information concerning the proposed nominee need not be included in
the proxy statement furnished to stockholders in connection with the Annual
Meeting. These provisions shall not apply to nomination of any persons entitled
to be separately elected by holders of any class or series of capital stock
pursuant to the terms of such capital stock or pursuant to the terms of any
contract to which the Corporation shall be a party.
Section 3.4. Chairman of the Board. The Directors may elect
one of their members to be Chairman of the Board of Directors, hereafter in
these By-Laws referred to as the "Chairman." The Chairman shall be subject to
the control of, and may be removed with or without cause by, the Board of
Directors. The Chairman shall perform such duties as may from time to time be
assigned to him by the Board of Directors.
Section 3.5. Meetings. Regular meetings of the Board of
Directors shall be held at such dates, times, and places as may from time to
time be fixed by the Board of Directors. Notice need not be given of regular
meetings of the Board of Directors. Special meetings of the Board of Directors
may be held at any date, time, and place upon the call of the Chairman, or the
Chief Executive Officer, and shall be called by the Secretary if and as directed
by one-third of the Directors then in office. Facsimile, or other written notice
of the place, date, and time of each special meeting of the Board of Directors
shall be given not less than two (2) days before such meeting to each Director
who shall not waive such notice. Such notice shall state the time and place of
the special meeting, but unless required by law, the Certificate of
Incorporation or these By-Laws, need not state the purpose of the special
meeting. Meetings of the Board of Directors may be held without notice
immediately after annual meetings of stockholders.
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Section 3.6. Action Without Meeting. Nothing contained in
these By-Laws shall be deemed to restrict the power of the Board of Directors or
of any committee thereof to take any action without a meeting by means of
consents thereto in writing or by electronic transmission according to
applicable law.
Section 3.7. Telephonic Meetings. Nothing contained in these
By-Laws shall be deemed to restrict the power of members of the Board of
Directors, or of any committee of the Board of Directors to participate in
meetings of the Board of Directors (or of such committees) by means of
conference telephone or similar communications equipment by means of which all
persons participating in such meeting can hear each other.
Section 3.8. Quorum; Acts of the Board of Directors. One-third
of the total number of members of the Board of Directors as constituted from
time to time, but not less than three (3), shall constitute a quorum for the
transaction of business. If a quorum is not present at any meeting of the Board
of Directors, a majority of the Directors present may adjourn the meeting to
another place, date, and time without further notice or waiver. Except as
otherwise provided by law, by the Certificate of Incorporation, by these
By-Laws, or by any binding contract or agreement to which the Corporation is a
party, the act of a majority of the Directors present at any meeting at which
there is a quorum shall be the act of the Board of Directors.
Section 3.9. Committees of the Board of Directors. Effective
on the adoption of these By-Laws, the Corporation elects to be governed as to
committees of the Board of Directors by the provisions of Section 141(c)(2)of
the Delaware General Corporation Law. The Board of Directors, by resolution
adopted by a majority of the whole Board of Directors, may designate one or more
committees to have and to exercise such power and authority as the Board of
Directors shall specify. Each such Committee shall consist of such number of
Directors as from time to time may be fixed by the Board of Directors. In the
absence or disqualification of a member of a committee, the member or members
thereof present at any meeting and not disqualified from voting may (whether or
not he or they constitute a quorum) unanimously appoint another Director to act
at the meeting in place of the absent or disqualified committee member. Each
committee may fix procedural rules for meeting and for conducting its business
and shall act in accordance therewith, except as otherwise provided in these
By-Laws or as otherwise required by law. Adequate provision shall be made for
notice to committee members of all committee meetings. One-half of the members
of each committee shall constitute a quorum (unless the committee shall consist
of one member, in which event one member shall constitute a quorum). All matters
shall be determined by a majority vote of the committee members present at the
committee meeting.
Section 3.10. Minutes of Meetings of Committees. Each
committee of the Board of Directors shall keep minutes of its meetings and shall
report the same when and as required by the Board of Directors.
Section 3.11. Compensation of Directors. Directors shall be
paid their expenses of attendance at meetings of the Board of Directors or
committees thereof. Directors, pursuant to a resolution adopted by a majority of
the whole Board of Directors, may also be paid a fixed sum for attendance at
each meeting of the Board of Directors or a committee thereof, a stated salary
for service as a Director, a stated salary for service as a Committee
chairperson, and for other service as a Director. No payment referred to in this
Section 3.10 shall preclude any Director from serving the Corporation in any
other capacity or from receiving compensation therefor.
ARTICLE IV
OFFICERS
Section 4.1. General. The Corporation's officers shall consist
of a Chief Executive Officer, a President, one or more Vice Presidents, a
Secretary, a Treasurer, and such other officers (which may include one or more
Assistant Secretaries and Assistant Treasurers) with such titles and duties as
the Board of Directors shall determine. The Chairman shall be an officer if
designated by the Board of Directors as an Executive Chairman. The officers may
have such additional personal titles as shall be approved by the Board of
Directors to indicate their function or seniority. Any number of offices may be
held by the same person. Each officer shall be elected by the
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Board of Directors, shall be subject to supervision and direction by the Board
of Directors, shall serve at the pleasure of the Board of directors, and shall
hold office for the term prescribed by the Board of Directors. The salaries of
all officers shall be fixed by the Board of Directors. The authority, duties, or
responsibilities of any officer may be suspended by the Board of Directors with
or without cause. Any officer may be removed at any time by the Board of
Directors with or without cause. Any officer may resign at any time by
submitting an electronic transmission or by delivering a written notice of
resignation, signed by such officer, to the Chairman, the Chief Executive
Officer or the Secretary. Unless otherwise specified therein, such resignation
shall take effect upon delivery.
Section 4.2. The Chief Executive Officer. The Chief Executive
Officer shall be the Corporation's chief executive officer. Subject to the
provisions of these By-Laws and to the direction of the Board of Directors, the
Chief Executive Officer shall have responsibility for general management and
control of the Corporation's affairs and business and shall perform all duties
and have all powers which are commonly incident to the office of chief executive
or which are delegated to him by the Board of Directors. The Chief Executive
Officer shall have power to sign all stock certificates, contracts, and other
authorized instruments of the Corporation. The Chief Executive Officer shall
have general supervision and direction of the Corporation's other officers and
agents.
Section 4.3 The President. The President shall be responsible
for the day to day operations of the Corporation as may be delegated to the
President by the Chief Executive Officer from time to time and, if the Chief
Executive Officer shall be absent or unable to act, the President shall act in
the stead of the Chief Executive Officer.
Section 4.4. The Vice Presidents. In the President's absence
(or in the event of his inability or refusal to act), the Vice President (or if
there be more than one Vice President, the Vice Presidents in the order
designated by the Board of Directors, or in the absence of such designation,
then in the order of their election, starting with the first to be elected)
shall perform all duties of the President. When so acting, such Vice President
shall have all powers of, and be subject to all restrictions upon, the
President. The Vice President(s) shall perform such other duties, and shall have
such other powers, as the Board of Directors shall prescribe.
Section 4.5. The Secretary; Assistant Secretaries. The
Secretary shall attend all meetings of the Board of Directors and all meetings
of stockholders, and shall record the proceedings of such meetings in a book or
books to be kept for that purpose. If so directed by the Board of Directors, the
Secretary shall perform similar duties with respect to meetings of committees of
the Board of Directors. The Secretary shall give (or cause to be given) notice
of all meetings of stockholders and of all special meetings of the board of
directors. The Secretary shall have custody of the Corporation's seal and he (or
any Assistant Secretary) shall have authority to affix such seal to any
appropriate instrument. When so affixed, such seal may be attested by the
Secretary's (or such Assistant Secretary's) signature. The Board of Directors
may give general authority to any other officer to affix the Corporation's seal
and to attest such affixation by such other officer's signature. In the
Secretary's absence (or in the event of his inability or refusal to act), the
Assistant Secretary (or if there shall be more than one Assistant Secretary, the
Assistant Secretaries in the order designated by the Board of Directors, or in
the absence of such designation, then in the order of their election, starting
with the first to be elected) shall have all powers of, and be subject to all
restrictions upon, the Secretary. The Secretary and the Assistant Secretary (or
Assistant Secretaries) shall perform such other duties, and shall have such
other powers, as the Board of Directors shall prescribe with respect to each
such office.
Section 4.6. The Treasurer; Assistant Treasurers. The
Treasurer shall have custody of the Corporation's monies and securities, shall
keep regular books of account, and shall deposit all of the Corporation's monies
and other valuable effects in the name of (and to the credit of) the corporation
in one or more depositories designated by the Board of Directors. The Treasurer
shall disburse the Corporation's funds as directed by the Board of Directors and
shall take vouchers for such disbursements. The Treasurer shall render to the
Board of Directors at its regular meetings (or when otherwise directed by the
Board of Directors) an account of his transactions as
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Treasurer and of the Corporation's financial condition. In the absence of the
Treasurer (or in the event of his inability or refusal to act), the Assistant
Treasurer (or if there shall be more than one Assistant Treasurer, the Assistant
Treasurers in the order designated by the Board of Directors, or in the absence
of such designation, then in the order of their election, starting with the
first to be elected) shall have all powers of, and be subject to all
restrictions upon, the Treasurer. The Treasurer and the Assistant Treasurer (or
Assistant Treasurers) shall perform such other duties, and shall have such other
powers, as the Board of Directors shall prescribe with respect to each such
office.
Section 4.7. Delegation of Authority. The Board of Directors
may from time to time delegate or authorize the delegation of the powers or
duties of any officer to any other officer or agent, notwithstanding any other
provision of these By-Laws.
Section 4.8. Facsimile Signatures of Officers. Facsimile
signatures of any officer may be used whenever authorized by these By-Laws or by
the Board of Directors.
Section 4.9. Action with Respect to Securities of Other
Entities. Unless otherwise prescribed by the Board of Directors, the Executive
Chairman, the Chief Executive Officer, the President or Secretary (or any other
officer designated by the Chief Executive Officer to act in their stead) shall
have power and authority on the Corporation's behalf to attend (and to act and
vote at) meetings of holders of securities of any entity in which the
Corporation shall own or hold securities. At such meetings, the Chairman, the
Chief Executive Officer, the President, Secretary or Chief Executive Officer's
designee, as the case may be, shall possess (and may exercise) all rights and
powers incident to the ownership or holding of such securities which the
Corporation might have possessed and exercised. The Chief Executive Officer, the
President, the Secretary or the Chief Executive Officer's designee may execute
and deliver on the Corporation's behalf powers of attorney, proxies, consents,
waivers, and other instruments relating to the securities owned or held by the
Corporation.
ARTICLE V
CAPITAL STOCK
Section 5.1. Stock Certificates. Certificates for shares of
the Corporation's capital stock shall be in such form as shall be permitted by
law and approved by the Board of Directors. Every holder of stock in the
Corporation shall be entitled to have a certificate signed by, or in the name of
the Corporation by the Chairman or the Chief Executive Officer or the President
or a Vice President and by the Treasurer or an Assistant Treasurer, or the
Secretary or an Assistant Secretary, certifying the number of shares owned by
him in the corporation. If such certificate is countersigned (1) by a transfer
agent other than the Corporation or its employee, or (2) by a registrar other
than the Corporation or its employee, any other signatures on the certificate
may be facsimile. In case any officer who has signed or whose facsimile
signature has been placed upon a certificate shall have ceased to be such
officer before such certificate is issued, it may be issued by the Corporation
with the same effect as if he were such officer at the date of issue.
If the Corporation shall be authorized to issue more than one
class of stock or more than one series of any class, the designations,
preferences and relative, participating optional or other special rights of each
class of stock or series thereof and the qualifications, limitations or
restrictions of such preferences and/or rights shall be set forth in full or
summarized on the face or back of the certificates which the Corporation shall
issue to represent such class or series of stock or there shall be set forth on
the face or back of the certificates which the Corporation shall issue to
represent such class or series of stock, a statement that the Corporation will
furnish, without charge to each stockholder who so requests, the designations,
references and relative, participating, optional or other special rights of each
class of stock or series thereof and the qualifications, limitations or
restrictions of such preferences and/or rights. Any restriction imposed upon the
transfer of shares or registration of transfer of shares shall be noted
conspicuously on the certificate representing the shares subject to such
restriction.
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Section 5.2. Transfer of Shares. Shares of the Corporation's
capital stock may be transferred on the Corporation's books only by the holder
of such shares (or by such holder's authorized attorney) upon surrender to the
Corporation or to the Corporation's transfer agent of the properly endorsed
certificate(s) representing such shares.
Section 5.3. Lost, Stolen, or Destroyed Certificates. The
Board of Directors (or the Corporation's transfer agent) may authorize the
issuance of a new share certificate to replace any certificate theretofore
issued by the Corporation which is alleged to have been lost, stolen, or
destroyed. The Board of Directors, as a condition to such issuance, may require
that the owner of such lost, stolen, or destroyed certificate, or his legal
representative, (i) submit to the Corporation an affidavit stating that such
certificate has been lost, stolen, or destroyed, (ii) advertise the same in such
manner as the Board of Directors shall require, and/or (iii) give the
Corporation a bond in such sum as the Board of Directors shall require to
indemnify the Corporation against any claim that may be made against the
Corporation in respect of the certificate alleged to have been lost, stolen,
destroyed or the certificate to be issued.
Section 5.4. Record Date. In order that the Corporation may
determine the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, the Board of Directors may fix a record
date, which record date shall not precede the date upon which the resolution
fixing the record date is adopted by the Board of Directors, and which record
date shall not be more than sixty (60) nor less than ten (10) days before the
date of such meeting.
In order that the Corporation may determine the stockholders
entitled to receive payment of any dividend or other distribution or allotment
of any rights or the stockholders entitled to exercise any rights in respect of
any change, conversion or exchange of stock, or for the purpose of any other
lawful action, the Board of Directors may fix a record date, which record date
shall not precede the date upon which the resolution fixing the record date is
adopted, and which record date shall be not more than sixty (60) days prior to
such action.
If no record date is fixed:
(1) The record date for determining stockholders entitled to
notice of or to vote at a meeting of stockholders shall be at the close of
business on the day next preceding the day on which notice is given, or if
notice is waived, at the close of business on the day next preceding the day on
which the meeting is held. A determination of stockholders of record entitled to
notice of or to a vote at a meeting of stockholders shall apply to any
adjournment of the meeting; provided, however, that the Board of Directors may
fix a new record date for the adjourned meeting.
(2) The record date for determining stockholders entitled to
consent to corporate action in writing without a meeting, when no prior action
by the Board of Directors is necessary, shall be the first date on which a
signed written consent setting forth the action taken or proposed to be taken is
delivered to the Corporation by delivery to its registered office in this State,
its principal place of business, or an officer of agent of the corporation
having custody of the book in which proceedings of meetings of stockholders are
recorded. Delivery made to the Corporation's registered office shall be by hand
or by certified or registered mail, return receipt requested.
(3) The record date for determining stockholders entitled to
consent to corporate action in writing without a meeting, when prior action by
the Board of Directors is required, shall be at the close of business on the day
on which the Board of Directors adopts the resolution taking such prior action.
(4) The record date for determining stockholders for any other
purpose shall be at the close of business on the day on which the Board of
Directors adopts the resolution relating thereto.
Section 5.5. Registered Stockholders. The Corporation shall be
entitled to recognize the exclusive right of a person registered on the
Corporation's books as the owner of shares of capital stock to receive dividends
on such shares and to vote as owner of such shares. The Corporation need not
recognize any claim to (or
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interest in) such shares by any other person, whether or not the Corporation
shall have notice thereof, except as otherwise required by law.
Section 5.6. Regulations. The Board of Directors shall have
power and authority to make all rules and regulations which it deems expedient
concerning the issuance, transfer, registration, cancellation, and replacement
of certificates representing the Corporation's capital stock.
ARTICLE VI
GENERAL PROVISIONS
Section 6.1. Checks, etc. All checks, other drafts, and notes
of the Corporation in excess of Twenty-Five Thousand Dollars ($25,000) shall be
signed by at least two of such persons as the Board of Directors shall designate
or authorize. Any two of those persons designated or authorized by the Board of
Directors to sign checks, other drafts and notes of the Corporation are
authorized to open and jointly use such accounts with such banks or trust
companies as may from time to time be required for the purposes of the
Corporation.
Section 6.2. Contracts. All contracts, agreements, indentures
or other written commitments intended to bind the Corporation shall be signed by
an officer pursuant to the authority of the Board of Directors including
authority limitation regulations adopted from time to time by the Board of
Directors.
Section 6.3. Pro-Forma Banking and Qualification Resolutions.
Resolutions from time to time necessary or appropriate for the opening or
maintenance by the Corporation of any account with any bank or trust company or
for the qualification of the Corporation to do business under the laws of any
state shall be effective and shall be adopted in haec verba as of the date of
certification thereof so long as such resolutions shall be certified by the
Secretary or an Assistant Secretary of the Corporation and filed with the
permanent records of the resolutions of the Directors of the Corporation.
Section 6.4. Fiscal Year. The Corporation's fiscal year shall
be the twelve calendar months ending December 31 in each year unless otherwise
fixed by the Board of Directors.
Section 6.5. Corporate Seal. The Corporation's corporate seal
shall have inscribed thereon the Corporation's name, the year of its
incorporation, and the words "Corporate Seal" and "Delaware".
Section 6.6. Notices. Whenever any law, the Certificate of
Incorporation, or these By-Laws requires that notice be given to any Director,
officer, or stockholder, such notice may be given personally or in writing by
mail, addressed to such Director, officer, or stockholder at his address which
appears on the Corporation's records. Any notice given by mail shall be deemed
to have been given when deposited in the United States mail, with postage
thereon prepaid. Notice to Directors or officers may be given by telegram,
cable, radiogram, or facsimile, addressed to such Director or officer at his
address which appears on the Corporation's records, in which case notice shall
be deemed to have been given when delivered for transmission.
Section 6.7. Time Periods. Whenever these By-Laws require that
an act be done or not be done a specified number of days prior to or after the
occurrence of any event (or require that an act be done or not be done within a
period of days prior to or after the occurrence of an event), calendar days
shall be used, with the day of the doing of such act excluded and the day of the
occurrence of such event included.
Section 6.8 Books and Records. Except to the extent otherwise
required by law, the books and records of the Corporation shall be kept at such
place or places within or without the State of Delaware as may be determined
from time to time by or under the authority of the Board of Directors.
B-8
Section 6.9 Amendments. The holders of shares of capital stock
entitled at the time to vote for the election of Directors shall have power to
amend or repeal these By-Laws by vote of not less than a majority of such
shares. Except as otherwise provided by law, the Board of Directors shall have
power to amend or repeal these By-Laws by vote of not less than a majority of
the entire Board of Directors. Any by-law adopted by the Board of Directors,
however, may be amended or repealed by vote of the holders of a majority of the
shares of capital stock entitled at the time to vote for the election of
Directors.
Section 6.10 Construction. In the event of any conflict
between the provisions of these By-Laws and the Certificate of Incorporation,
the provisions of the Certificate of Incorporation shall be controlling.
B-9
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Under Section 145 of the Delaware General Corporation Law, a corporation
may indemnify a director, officer, employee or agent of the corporation (or a
person who is or was serving at the request of the corporation as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise) against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by the person if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the corporation and, with
respect to any criminal action or proceeding, had no reasonable cause to believe
his conduct was unlawful. In the case of an action brought by or in the right of
a corporation, the corporation may indemnify a director, officer, employee or
agent of the corporation (or a person who is or was serving at the request of
the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise) against
expenses (including attorneys' fees) actually and reasonably incurred by him if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation, except that no indemnification
may be made in respect of any claim, issue or matter as to which such person
shall have been adjudged to be liable to the corporation unless and only to the
extent a court finds that, in view of all the circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such expenses as the
court shall deem proper.
Fuel Tech Delaware's certificate of incorporation provides that no
director of Fuel Tech Delaware shall be liable to Fuel Tech Delaware or its
stockholders for monetary damages for breach of fiduciary duty as a director to
the fullest extent permitted by law.
Fuel Tech Delaware's certificate of incorporation also provides that
Fuel Tech Delaware shall indemnify to the fullest extent permitted by Delaware
law any and all of its directors and officers, or former directors and officers,
or any person who may have served at Fuel Tech Delaware's request as a director
or officer of another corporation, partnership, joint venture, trust or other
enterprise.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits:
NUMBER DESCRIPTION
------ -----------
3.1* Proposed Certificate of Incorporation of Fuel Tech, Inc.
3.2* Proposed Bylaws of Fuel Tech, Inc.
5.1 Opinion of Finn Dixon & Herling LLP
8.1 Opinion of Deloitte Tax LLP
21.1* Subsidiaries of Fuel Tech, Inc.
23.1 Consent of Finn Dixon & Herling LLP (included in Exhibit 5.1)
23.2 Consent of Deloitte Tax LLP
23.3 Consent of Ernst & Young LLP
24.1* Power of Attorney
---------------
* Previously filed.
ITEM 22. UNDERTAKINGS
The undersigned registrant hereby undertakes as follows:
(1) 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 15(d) of the Securities Exchange Act of 1934 (and, where
II-1
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.
(2) To deliver or cause to be delivered with the prospectus, to each person to
whom the prospectus is sent or given, the latest annual report, to security
holders that is incorporated by reference in the prospectus and furnished
pursuant to and meeting the requirements of Rule 14a-3 or Rule 14c-3 under the
Securities Exchange Act of 1934; and, where interim financial information
required to be presented by Article 3 of Regulation S-X is not set forth in the
prospectus, to deliver, or cause to be delivered to each person to whom the
prospectus is sent or given, the latest quarterly report that is specifically
incorporated by reference in the prospectus to provide such interim financial
information.
(3) To respond to requests for information that is incorporated by reference
into the prospectus within one business day of receipt of such request, and to
send the incorporated documents by first class mail or other equally prompt
means. This includes information contained in documents filed subsequent to the
effective date of the registration statement through the date of responding to
the request.
(4) 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 of controlling person or the registrant in the
successful defense of any action, suite or proceeding) is asserted by such
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.
II-2
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant has duly caused this Amendment No.1 to the registration statement to
be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of Stamford, State of Connecticut, on the 4th day of August, 2006.
FUEL-TECH N.V.
By: /s/ Ralph E. Bailey
--------------------------------------
Name: Ralph E. Bailey
Title: Executive Chairman and Director
Pursuant to the requirements of the Securities Act of 1933, this
Amendment No. 1 to the registration statement has been signed below by the
following persons in the capacities indicated.
SIGNATURE TITLE DATE
---------------------------- ----------------------------------------------------- ------------
* August 4, 2006
-------------------
Ralph E. Bailey Executive Chairman and Director
* President, Chief Executive Officer and Director August 4, 2006
----------------------- (Principal Executive Officer)
John F. Norris, Jr.
* Chief Financial Officer, Vice President and Treasurer August 4, 2006
--------------------- (Principal Financial and Accounting Officer)
Vincent J. Arnone
* Managing Director August 4, 2006
---------------------
Douglas G. Bailey
* Managing Director August 4, 2006
------------------
Thomas S. Shaw
* Managing Director August 4, 2006
-------------------
Miguel Espinosa
* Managing Director August 4, 2006
----------------------
Samer S. Khanachet
* Managing Director August 4, 2006
------------------
John D. Morrow
Managing Director ______, 2006
------------------
Thomas L. Jones
/s/ Charles W. Grinnell Managing Director, Vice President, General Counsel and August 4, 2006
----------------------- Corporate Secretary
Charles W. Grinnell
*By: /s/ Charles W. Grinnell
-----------------------
Charles W. Grinnell
(Attorney-in-Fact)