-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, flYbVxRPI0EcBa2Llc8zAx9rTR35pjc8snzKeTSUj27ecGGllCVbXxT/Y9ERS9pN 0ks5VR/yadj6kBX7yQLjmw== 0000912057-95-003187.txt : 19950508 0000912057-95-003187.hdr.sgml : 19950508 ACCESSION NUMBER: 0000912057-95-003187 CONFORMED SUBMISSION TYPE: POS AM PUBLIC DOCUMENT COUNT: 1 REFERENCES 429: 033-66684 FILED AS OF DATE: 19950505 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: GTS DURATEK INC CENTRAL INDEX KEY: 0000785186 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-HELP SUPPLY SERVICES [7363] IRS NUMBER: 222476180 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: POS AM SEC ACT: 1933 Act SEC FILE NUMBER: 033-71208 FILM NUMBER: 95534731 BUSINESS ADDRESS: STREET 1: 8955 GUILFORD RD SUITE 200 CITY: COLUMBIA STATE: MD ZIP: 21046 BUSINESS PHONE: 4103125100 MAIL ADDRESS: STREET 2: 8955 GUILFORD RD SUITE 200 CITY: COLUMBIA STATE: MD ZIP: 21046 FORMER COMPANY: FORMER CONFORMED NAME: DURATEK CORP DATE OF NAME CHANGE: 19920703 POS AM 1 FORM S-2 As filed with the Securities and Exchange Commission on May 5, 1995 Post-Effective Amendment No. 1 to Registration No. 33-71208 Post-Effective Amendment No. 5 to Registration No. 33-66684 - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ______________________ POST-EFFECTIVE AMENDMENT NO. 1 TO FORM S-3 REGISTRATION STATEMENT AND POST-EFFECTIVE AMENDMENT NO. 5 TO FORM S-3 REGISTRATION STATEMENT ON FORM S-2 UNDER THE SECURITIES ACT OF 1933 ________________________ GTS DURATEK, INC. (Exact name of registrant as specified in its charter) Delaware 22-2476180 (State or other jurisdiction (I.R.S. Employer of incorporation) Identification No.) 8955 Guilford Road, Suite 200 Columbia, Maryland 21046 (410) 312-5100 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) ROBERT E. PRINCE President and Chief Executive Officer GTS Duratek, Inc. 8955 Guilford Road, Suite 200 Columbia, Maryland 21046 (410) 312-5100 (Name, address, including zip code, and telephone number, including area code, of agent for service) * Copies to: * Henry D. Kahn, Esquire Piper & Marbury, L.L.P. Charles Center South 36 South Charles Street Baltimore, Maryland 21201 (410) 539-2530 Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this Registration Statement. If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. /x/ If the registrant elects to deliver its latest annual report to security holders, or a complete and legible facsimile thereof, pursuant to to Item II(a)(1) of this form, check the following box. /x/ In accordance with Rule 429 under the Securities Act of 1933, as amended, the Prospectus contained herein also relates to 667,134 shares of Common Stock covered by Registration Statement No. 33-66684. GTS DURATEK, INC. CROSS REFERENCE SHEET Form S-2 Location Item Number and Heading in Prospectus 1. Forepart of the Registration Statement and Outside Front Cover Outside Front Cover Page of Prospectus. . . . . Page Inside Front Cover 2. Inside Front and Outside Back Cover Pages Page; Outside of Prospectus . . . . . . . . . . . . . . . . . Back Cover Page 3. Summary Information, Risk Factors and Ratio of The Company; Risk Earnings to Fixed Charges . . . . . . . . . . . Factors 4. Use of Proceeds . . . . . . . . . . . . . . . . . Use of Proceeds 5. Determination of Offering Price . . . . . . . . . Not Applicable 6. Dilution. . . . . . . . . . . . . . . . . . . . . Not Applicable The Selling 7. Selling Security Holders. . . . . . . . . . . . . Shareholders 8. Plan of Distribution. . . . . . . . . . . . . . . Plan of Distribution Outside Front Cover Page; Description of 9. Description of Securities to be Registered. . . . Capital Stock 10. Interests of Named Experts and Counsel. . . . . . Legal Matters; Experts The Company; Additional Information about the Company; Incorporation of Certain Documents by 11. Information With Respect to the Registrant. . . . Reference Incorporation of 12. Incorporation of Certain Information by Certain Documents Reference . . . . . . . . . . . . . . . . . . . by Reference 13. Disclosure of Commission Position on Indemnification for Securities Act Liabilities . . . . . . . . . . . . . . . . . . Not Applicable 2,104,634 SHARES GTS DURATEK, INC. COMMON STOCK ------------ This Prospectus relates to up to 2,104,634 shares (the "Shares") of Common Stock $0.01 par value (the "Common Stock"), of GTS Duratek, Inc. (the "Company"), which may be offered by certain shareholders of the Company (the "Selling Shareholders") from time to time in transactions on the Nasdaq National Market, in privately negotiated transactions or otherwise, at fixed prices that may be changed, at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices. The Selling Shareholders may effect such transactions by selling the Shares to or through broker-dealers, and such broker-dealers may receive compensation in the form of discounts, concessions or commissions from the Selling Shareholders or the purchasers of the Shares for whom such broker-dealers may act as agent or to whom they sell as principal, or both (which compensation to a particular broker- dealer might be in excess of customary commissions). See "The Selling Shareholders" and "Plan of Distribution." None of the proceeds from the sale of the Shares will be received by the Company. The Company will receive the proceeds from the exercise of the warrants and the options referred to in (ii) and (iii) below, respectively. See "Use of Proceeds." Of the 2,104,634 shares offered hereby, (i) 667,134 shares were received by two of the Selling Shareholders pursuant to an Exchange Offer with National Patent Development Corporation which was concluded in August, 1993, (ii) 500,000 shares are subject to warrants issued by the Company to a Selling Shareholder in connection with the purchase of rights to certain medical waste and hazardous waste vitrification technologies, (iii) 250,000 shares are subject to options issued by the Company to two Selling Shareholders in consideration of such Selling Shareholders licensing certain vitrification technologies to the Company and (iv) 687,500 shares were sold by the Company to two Selling Shareholders in connection with a transaction between the Company and a corporation controlled by such Selling Shareholders to enable the Company and such corporation to jointly develop certain medical, hazardous and asbestos waste technologies. See "The Selling Shareholders." The Common Stock is listed on the Nasdaq National Market under the symbol "DRTK." On May 3, 1995, the last reported sale price of the Common Stock on the Nasdaq National Market was $5 1/8 per share. SEE "RISK FACTORS" FOR A DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK OFFERED HEREBY. ---------------- THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ---------------- The date of this Prospectus is May 5, 1995. AVAILABLE INFORMATION The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission"). Such reports, proxy statements and other information can be inspected and copied at the public reference facilities of the Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the Commission's Regional Offices located at 75 Park Place, 14th Floor, New York, New York 10007, and Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of such materials may be obtained from the Public Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The Company's Annual Report on Form 10-K for the year ended December 31, 1994, which has been filed by the Company with the Commission pursuant to the Exchange Act, is being delivered to each person who receives this Prospectus and is hereby incorporated into this Prospectus by reference. Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. THE COMPANY GTS Duratek, Inc. (the "Company" or "GTS Duratek") was incorporated in the state of Delaware in December 1982. At December 31, 1994, GTS Duratek was an approximately 61% controlled subsidiary of National Patent Development Corporation ("National Patent"). The Company's business consists of two operating groups: (1) the "Technology Group" (formerly Environmental Services) engaged, directly and through joint ventures, in converting radioactive, hazardous and mixed (both radioactive and hazardous) waste to glass, using in- furnace vitrification processes, and removing radioactive and/or hazardous contaminants from waste water and other liquids using filtration and ion exchange processes and (2) the "Service Group" (formerly Consulting and Staff Augmentation) engaged in consulting, engineering, training, and staff augmentation services. The Company provides services and technologies for various utility, industrial, governmental, and commercial clients. On January 24, 1995, the Company consummated a financing transaction (the "Financing Transaction") with The Carlyle Group, a Washington, D.C. based private merchant bank 2 ("Carlyle"), as a result of which Carlyle has the ability to elect a majority of the Company's Board of Directors and effectively control the Company. See "The Financing Transaction" for a further description of the Financing Transaction. THE TECHNOLOGY GROUP The Company's Technology Group provides radioactive, hazardous, and mixed (radioactive and hazardous) waste treatment systems and services for government and private industry customers. The significant portion of the Technology Group's business is in converting these wastes to durable glass through a vitrification process. The group designs, builds, tests and operates vitrification systems that are tailored to its customers' waste streams and treatment needs. GTS Duratek's vitrification business startup and early growth were largely dependent upon DOE-funded contracts, which should also account for a substantial portion of the Technology Group's business over the next year. However, the Company has made progress in commercializing the technology and is pursuing commercial business in parallel with additional government business. In a joint venture with Chem-Nuclear Systems, Inc. ("Chem-Nuclear") formed in 1994, called DuraChem, GTS Duratek is building a South Carolina facility to vitrify commercially-generated low-level radioactive waste. The customer base for the facility will include nuclear power plants, hospitals and laboratories. Due to the closure of nationally accessible disposal sites and the state waste compacts' delay in opening regional sites, many of these waste generators are faced with interim storage of the material at their own facilities. By converting the waste to glass, DuraChem will significantly reduce the volume of the waste to be stored, and the highly leach- resistant waste form (glass) can be safely stored long-term at the generators' facilities without fear of the contaminants escaping into the environment. Moreover, management believes that when regional burial sites open, the glass waste form, by today's standards, should meet or exceed the waste compacts' acceptance criteria. In a joint venture with Vitritek Holdings, L.L.C., called Vitritek Environmental ("Vitritek"), GTS Duratek has expanded its vitrification technology to include nonradioactive hazardous waste, such as asbestos, fly ash and medical waste. Unlike radioactive vitrified waste, which must be stored in a shielded facility or buried, once converted to glass, some hazardous waste becomes non-hazardous, and the glass can be recycled as useful products, for example, ceramic tile, decorative brick, insulation and aggregate for making paving materials. In the liquid waste treatment business, GTS Duratek continues to supply its proprietary DURASIL -REGISTERED TRADEMARK- ion exchange media, Enhanced Volume Reduction (EVR) processing system, Heat Enhanced Dewatering (HED) system and Integrated Nuclear Waste Removal System (a combination of EVR and HED) to all foreign customers and non-commercial U.S. customers, for example, DOE environmental restoration prime contracts. The Company sold its domestic commercial low-level radioactive waste processing business to Chem-Nuclear in 1990. Under 3 the sales agreement, as amended in April 1994, GTS Duratek supplies DURASIL - REGISTERED TRADEMARK- products to Chem-Nuclear and permits Chem-Nuclear to produce and sell the media to third parties for a fee to be paid to Duratek. THE SERVICES GROUP The Services Group provides technicians, specialists, and professionals for a wide range of consulting, training, and staff augmentation services for utility, industrial, commercial, and governmental customers. The dominant portion of the business is in providing technical personnel to assist utility staffs during nuclear power plant refueling and maintenance outages. Due to lower growth and competitive pressures in that market, however, the Services Group is focusing on expanding its business with existing customers, adding a few well-selected new customers, and shifting the mix of its services business toward higher-margin professional services, such as consulting, engineering and training. The Services Group is also focusing on the environmental restoration market by blending its services with the Technology Group's waste treatment capabilities to provide a comprehensive service package and by teaming with large environmental companies in pursuit of major remediation projects. THE FINANCING TRANSACTION On January 24, 1995, the Company consummated the Financing Transaction whereby it issued for $16 million 160,000 shares of 8% Cumulative Convertible Redeemable Preferred Stock, par value $.01 per share (the "Convertible Preferred Stock") and an option (the "Company Option ") to purchase up to an additional 1.25 million shares of the Company's newly issued Common Stock at any time prior to January 24, 1999 for $3.75 per share to investment partnerships sponsored and controlled by Carlyle. The Convertible Preferred Stock is initially convertible into the Company's Common Stock at a conversion price of $3 per share and, if not previously converted, the Company is required to redeem the outstanding Convertible Preferred Stock on December 31, 2001 for $100 per share plus accrued and unpaid dividends. The Company is required to pay quarterly dividends on the Convertible Preferred Stock of $320,000. In addition, as part of the Financing Transaction, Carlyle acquired 1,666,667 shares of Common Stock of the Company owned by National Patent for $3 per share and has the option (the "National Patent Option") to purchase up to an additional 500,000 shares of the Company's Common Stock from National Patent at any time prior to January 24, 1996 at an exercise price of $3.75 per share. Assuming the conversion of all of the Convertible Preferred Stock into Common Stock, Carlyle would own 49.9% of the Common Stock of the Company, excluding the effects of the exercise of the Company and the National Patent Options and all other outstanding warrants and employee stock options. Assuming the conversion of all of the Convertible Preferred Stock into Common Stock and assuming Carlyle's exercise in full of the Company and National Patent Options (but not the exercise of outstanding warrants and employee stock options), Carlyle would own 57.3% of the Company's Common Stock. 4 The terms of the Convertible Preferred Stock provide that the holders of a majority of the Convertible Preferred Stock have the right to elect a majority of the Company's Board of Directors so long as Carlyle owns shares of capital stock having 20% or more of the votes that may be cast at annual or special meetings of stockholders. As part of the Financing Transaction and the sale of the Company's Common Stock from National Patent to Carlyle, the Company, Carlyle and National Patent entered into a stockholders agreement (the "Stockholders Agreement") whereby, among other things, National Patent agreed to vote the remaining shares of Common Stock that it owns in favor of the Carlyle designees to the Company's Board of Directors. As a result of the Financing Transaction, Carlyle has the ability, through its stock ownership, the terms of the Convertible Preferred Stock and the terms of the Stockholders Agreement, to elect a majority of the Company's Board of Directors and effectively control the Company. ADDITIONAL INFORMATION ABOUT THE COMPANY Additional information relating to the business of the Company, consolidated financial statements of the Company and other related matters is set forth in or incorporated by reference in the Company's Annual Report on Form 10-K and the Annual Report to Stockholders for the year ended December 31, 1994, which is being delivered to each person who receives this Prospectus and is incorporated by reference herein. See "Incorporation of Certain Documents by Reference." RISK FACTORS IN ADDITION TO THE OTHER INFORMATION IN THIS PROSPECTUS, PROSPECTIVE INVESTORS SHOULD CONSIDER THE FOLLOWING FACTORS IN EVALUATING AN INVESTMENT IN THE SHARES OFFERED HEREBY: HISTORY OF LOSSES; ACCUMULATED DEFICIT. As of December 31, 1994, the Company had an accumulated deficit of $9,639,000 resulting principally from losses from operations including losses of $1,560,000 and $1,287,000 for 1991 and 1993, respectively, and operating losses related to the Company's old line of business prior to the sale of the domestic commercial low-level liquid radioactive waste processing business and the purchase of General Technical Services, Inc. (GTS). The loss from operations in 1991 was due to losses incurred by the domestic commercial low-level radioactive waste business that was sold and to investments made to start-up the vitrification technology business. The loss from operations for 1993 was due to the decline in revenues in the nuclear power plant support business, delays in the award and performance of DOE funded technology contracts where the Company had incurred certain expenses in anticipation of such contract awards, increased operating expenses relating to the development of the vitrification technology and certain litigation expenses. Although the Company had net income of $257,000 for 1994, there can be no assurance that in the future the 5 Company will generate sufficient revenues or limit operating expenses in order to sustain profitability. NO ASSURANCE OF SUCCESSFUL DEVELOPMENT OR ACCEPTANCE OF TECHNOLOGIES. The Company is in the process of developing and refining new vitrification technologies for site remediation and the Company's growth is significantly dependent upon the acceptance and implementation of these technologies. The Company is under several contracts to demonstrate these technologies at various sites owned by the Department of Energy (DOE) and waste sampling for two other DOE sites is in process. The awarding of any future contracts to implement this technology at this site as well as any other DOE sites is substantially dependent upon the DOE's evaluation of this technology versus several other competing technologies as well as the outcome of these contracts. There can be no assurance that this technology will prove to be a viable and cost-effective means of site remediation or that, even if effective, that the technology will be selected by the DOE for use in future site remediation projects. The Company and Vitritek Environmental, Inc., a Washington corporation ("VEI") entered into a co-license agreement to license medical waste and hazardous waste vitrification technologies from the inventors of such technologies. Subsequently, the Company and VEI agreed to jointly develop the technologies through a single entity, Vitritek, and each transferred their rights to the technologies to Vitritek. The hazardous waste vitrification technology has not yet been fully developed by the inventors of such technology. Accordingly, there can be no assurance that this technology will be developed in the near future, and that even if developed, the Company, through Vitritek, will be able to exploit and commercialize this technology or the medical waste vitrification technology. The Company and Chem-Nuclear have recently entered into a joint venture to commercially vitrify low-level radioactive waste using its vitrification process technologies. There can be no assurance that these technologies will prove to be a viable and cost-effective means of remediation or that the Company will be able to successfully commercialize the technology through this joint venture. DEPENDENCE ON DOE AND OTHER KEY CUSTOMERS. During 1994, the Company's environmental services revenue was primarily derived from various contracts relating to the vitrification process technologies with a combination of DOE contractors and subcontractors and a limited number of other customers. These revenues constituted approximately 78% of the Company's environmental services revenue and 19% of the Company's total revenues. The Company's inability to receive contract awards from the DOE or its contractors and subcontractors may have a material adverse effect on the Company's operations and growth prospects. The Company's consulting and staff augmentation revenues, which constituted approximately 81% of the Company's total revenues in 1994, was significantly dependent upon a limited number of customers with one customer accounting for approximately 22.6% of the Company's total revenues in 1994. Although the Company does have a contract with one of 6 these customers through the end of 1997, the loss of business from any of its major customers could have a material adverse effect on the Company's operations. "PENNY STOCK" REGULATIONS. The Commission has adopted regulations which define a "penny stock" to be any equity security that has a market price (as defined) of less than $5.00 per share, subject to certain exceptions, including securities listed on NASDAQ. For any transaction involving a penny stock, unless an exception applies, these regulations require the delivery, prior to the transaction, of a disclosure schedule prepared by the Commission relating to the penny stock market. A broker-dealer effecting transactions in penny stocks must disclose the commissions payable to both the broker-dealer and any registered representative, current quotations for the securities and, if the broker-dealer is the sole marketmaker, the broker-dealer must disclose this fact and the broker-dealer's presumed control over the market. Finally, monthly statements must be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks. While many NASDAQ-listed securities would otherwise be covered by the definition of penny-stock, transactions in a NASDAQ-listed security are exempt from all but the sole marketmaker provision of the penny stock regulations for: (i) issuers who have $2,000,000 in tangible assets; (ii) transactions in which the customer is an institutional accredited investor; and (iii) transactions that are not recommended by the broker-dealer. In addition, transactions in a NASDAQ-listed security effected directly with a NASDAQ marketmaker for such securities are subject only to the sole marketmaker disclosure requirement and the required disclosure with respect to commissions to be paid to the broker-dealer and the registered representative. Depending upon the market price for the Company's Common Stock, these rules may materially adversely affect the liquidity of the market for such securities and may impair the ability of the holders thereof to sell or otherwise dispose of such securities. GOVERNMENT FUNDING. The Company believes that the demand for its environmental services is directly related to the response of governmental authorities to public concern over the treatment and disposal of low-level radioactive wastes. If there were a lessening of public concern in this area, there could be a corresponding reduction in demand for the services and products offered by the Company. In addition, since it is anticipated that a significant portion of the Company's future environmental services revenues will be from government contracts, the Company's results of operations will be dependent on the level and timing of government funding. Government contracts are funded at the discretion of the government, are subject to termination at the convenience of the government or for default and often are not fully funded. In addition, potential application of the Company's vitrification process technologies in commercial and industrial situations could be adversely affected by a long standing inability of federal and state regulatory authorities to develop additional low level nuclear waste disposal sites. GOVERNMENT REGULATION. The Company's environmental services are subject to varying degrees of government regulation on the federal, state and local levels. The treatment and disposal of radioactive and hazardous wastes is subject to ever-increasing regulations being 7 promulgated by various federal agencies and state and local governments. The failure to comply with these regulations, which are frequently amended, could have a material adverse effect on the Company's business. PATENTS AND LICENSES. The Company owns and licenses a number of patents relating to ion media for the removal of impurities and contaminants from water and for the processing of radioactive and hazardous materials which expire from 1995 to 2009, including the vitrification process technologies which the Company licenses from Drs. Macedo and Litovitz of the Catholic University of America's Vitreous State Laboratory. In addition, the Company and VEI entered into a co- license agreement to co-license medical waste and hazardous waste vitrification technologies from Drs. Macedo and Litovitz of the Vitreous State Laboratory, the inventors of such technologies. Subsequently, the Company and VEI agreed to jointly develop the technologies through a single entity, Vitritek, and each transferred their rights to the technologies to Vitritek. There can be no assurances concerning the scope, validity or value of such existing patents, nor as to the protection from infringement by patents held by others and licensed to the Company. In addition, competitors could modify the essential technology represented by the Company's patents in such a way that it would not result in patent infringement. IMPACT OF SEASONALITY AND FLUCTUATIONS IN QUARTERLY RESULTS. A large component of the Company's staff augmentation business is the outage support for nuclear power plants. Accordingly, the Company's revenues have historically been subject to significant quarterly fluctuations, affected primarily by the timing of outage support projects at its customers' facilities, which typically occur in the spring and fall when electrical load demand is at its lowest. Accordingly, the results for any one quarter should not be considered indicative of the results for any other quarter or for the year. POTENTIAL LIABILITY AND INSURANCE. Performance of the Company's services requires exposure to radioactive and other hazardous materials and conditions. Although the Company is committed to a policy of operating safely and prudently, the Company may be subject to liability claims by employees, customers and third parties. In addition, the Company may be subject to fines, penalties or other liabilities arising from its actions imposed under environmental or safety laws. To date, the Company has been able to obtain liability insurance for the operation of its businesses, however, there can be no assurance that the Company's existing liability insurance policy is adequate or that it will be able to be maintained or that all possible claims that may be asserted against the Company will be covered by insurance. A partially or completely uninsured claim, if successful and of sufficient magnitude, could have a material adverse effect on the Company. COMPETITION. The industry in which the Company operates is fragmented and highly competitive. In the consulting and staff augmentation business, the Company competes 8 with many other firms, ranging from small local firms to large national firms having substantially greater financial, management and marketing resources than the Company. Competitive factors for these services include price considerations, performance record, quality, safety and availability of qualified technical personnel. In the environmental services business, the Company competes with many other firms that use competing technologies to the vitrification technologies developed and implemented by the Company. Many of such firms have significantly greater financial resources for research and development than the Company. CONTROL BY CARLYLE. Pursuant to the Financing Transaction, Carlyle purchased Convertible Preferred Stock which converts into 49.9% of the Common Stock of the Company and which by its terms gives the holder thereof the right to elect to elect a majority of the Company's Board of Directors. In addition, if Carlyle exercises in full the Company and National Patent Options, Carlyle will own 57.3% of the Company's Common Stock. Carlyle and National Patent also entered into the Stockholders Agreement whereby National Patent agreed to vote the remaining shares of Common Stock that it owns in favor of the Carlyle designees to the Company's Board of Directors. As a result of the Financing Transaction, Carlyle has the ability, through its stock ownership, the terms of the Convertible Preferred Stock and the terms of the Stockholders Agreement to elect a majority of the Company's Board of Directors and effectively control the Company. See "The Company - The Financing Transaction." DEPENDENCE ON TECHNICAL PERSONNEL. The Company's operations are dependent on the continued efforts of certain technical personnel which include certain of the Company's senior management as well as certain individuals at the Catholic University of America's Vitreous State Laboratory who have developed and are continuing to refine the vitrification process technologies and the medical and hazardous waste vitrification technologies. The loss of the services of any of these technical personnel may have a material adverse effect on the Company. AVAILABILITY OF SKILLED PROFESSIONALS. The Company's success in the consulting and staff augmentation segment of its business is dependent upon its ability to staff customer projects with skilled technical specialists and experts in a wide range of scientific, engineering, health and safety, data processing and communications disciplines. The Company does not retain all such skilled professionals on a full-time basis but contracts with these individuals on an as-needed basis. The market for skilled professionals in these disciplines is highly competitive and there can be no assurance that the Company will be able to retain these professionals when needed to staff customer projects or that the cost of such labor will not have significantly increased. 9 USE OF PROCEEDS None of the proceeds from the sale of the Shares will be received by the Company. However, the Company will receive the proceeds from the exercise of warrants issued to Environmental Corporation of America ("ECA") and the exercise of the options issued to Drs. Macedo and Litovitz. See "The Selling Shareholders." The warrants issued to ECA are to purchase 500,000 shares of the Company's Common Stock for $2.97 per share and will result in gross proceeds to the Company, assuming full exercise of the warrants, of $1,485,000. The warrants contain certain anti-dilution provisions which adjust the number of shares of Common Stock issuable upon the exercise of such warrants and the exercise price in the event the Company issues capital stock under certain circumstances. As a result of the Financing Transaction, the anti-dilution provision of the warrants was triggered and the Company is obligated to issue an additional 173,401 shares of Common Stock upon the exercise of the warrants and the exercise price decreased from $4.00 to $2.97 per share. The additional shares are not being registered in this prospectus. The options issued to Drs. Pedro Macedo and Theodore Litovitz are to purchase a total of 250,000 shares of the Company's Common Stock for $2.34 per share and will result in gross proceeds to the Company, assuming full exercise of the options of $585,000. The total gross proceeds to the Company from the exercise of the warrants and the options in full will be $2,070,000. The net proceeds to be received by the Company from the exercise of the Warrants or options will be approximately $2,030,000 after deducting estimated offering expenses. There can be no assurances, however, that the warrants or options referred to herein will be exercised in full or in part. The Company plans to use all of the approximately $2.0 million of net proceeds, to continue the commercialization of vitrification technologies, including the design and construction of capital equipment such as the Duramelter to be used at field locations. Each Duramelter is designed and constructed to specifications based on the characteristics of the waste streams of the particular field locations. Any remaining net proceeds will be used for general corporate purposes. The cost, timing and amount of funds required for specific uses by the Company cannot be precisely determined at this time. The allocation and timing of the Company's use of proceeds will be determined by such factors as the timing and amount of the exercise of the warrants and options, the Company's progress in the development of vitrification technologies, the demand for the use of such technologies, competitive conditions and the availability of alternative methods of financing, including agreements with other companies relating to the development and commercialization of the vitrification technologies. Pending such uses, the net proceeds will be invested in short- term, interest-bearing U.S. government securities or money market funds investing in such securities. 10 DESCRIPTION OF CAPITAL STOCK COMMON STOCK The Company is authorized to issue 20,000,000 shares of Common Stock, $.01 par value. As of March 31, 1995, 8,690,317 shares of Common Stock were issued and outstanding and 3,973,401 shares were reserved for issuance upon exercise of warrants or options. The holders of Common Stock are entitled to one vote per share on all matters voted on by stockholders, including the election of directors. There is no cumulative voting for the election of directors. Subject to the preferential rights of the Convertible Preferred Stock and any series of preferred stock that may be authorized and issued hereafter, the holders of Common Stock are entitled to such dividends as may be declared from time to time by the Board of Directors from funds available therefor. Upon liquidation, dissolution or winding-up of the Company, the holders of the Common Stock will be entitled to share ratably all assets of the Company available for distribution to such holders after payment of liabilities, subject to prior distribution rights of holders of any shares of Convertible Preferred Stock and any preferred stock authorized, issued and outstanding hereafter. No holder of Common Stock has any preemptive rights to subscribe for any securities of the Company of any kind or class. All outstanding shares of Common Stock are fully paid and non-assessable and all shares of Common Stock to be outstanding upon exercise of outstanding warrants or options will be fully paid and non-assessable. The rights, preferences and privileges of holders of Common Stock are subject to the rights, preferences and privileges of the Convertible Preferred Stock and will be subject to the rights, preferences and privileges of any series of preferred stock which the Company may authorize and issue in the future. The transfer agent and registrar for the Common Stock of the Company is Harris Trust Company of New York. PREFERRED STOCK The Company is authorized to issue 5,000,000 shares of Preferred Stock, $.01 par value. As of March 31, 1995, 160,000 shares of Convertible Preferred Stock were issued and outstanding. The following is a summary of the terms and conditions of the Convertible Preferred Stock: ISSUE. 160,000 shares of 8% Cumulative Convertible Redeemable Preferred Stock at a price of $100 per share. 11 DIVIDENDS. The Convertible Preferred Stock is entitled to cumulative annual dividends of 8% per share ($8.00) payable quarterly in arrears. PREFERENCES. The Convertible Preferred Stock have a preference with respect to assets and dividends over the Company's Common Stock. In the event of the liquidation, dissolution or winding up of the Company, the Convertible Preferred Stock are entitled to a preference of $100 per share. The Convertible Preferred Stock will be senior to any existing or future class of capital stock or securities into which convertible indebtedness is convertible. CONVERSION OR EXCHANGE. Each share of the Convertible Preferred Stock is, at the option of the holder, convertible into 33-1/3 shares of Common Stock based on an implied conversion price of $3.00 per share. REDEMPTION. The Company will redeem all of the outstanding shares of Convertible Preferred Stock on December 31, 2001 at $100 per share plus accrued and unpaid dividends. VOTING RIGHTS. Each share of Convertible Preferred Stock has the right to vote that number of votes equal to the number of shares of Common Stock issuable upon conversion of the Convertible Preferred Stock and has the right to vote, together with the Common Stock voting as a single class, on all matters on which the Common Stock can vote. Additionally, the holders of the Convertible Preferred Stock have the right, voting as a separate class, to elect a majority of the Company's Board of Directors. REGISTRATION RIGHTS. If the Company files a registration statement with the Securities and Exchange Commission (the "Commission") (excluding the Company's current shelf registration statement on file with the Commission and any registration statements filed in connection with any of the Company's employee benefit plans or in connection with any acquisition on Form S-4), the Company will include the shares of Common Stock issued upon conversion of the Convertible Preferred Stock or purchased from National Patent in such registration statement for sale in the same manner and under the same conditions as originally contemplated in such registration statement. The Company may reduce on a pro rata basis the number of shares sold by each selling stockholder if the number of shares to be registered and sold would materially and adversely effect the offering price. Additionally, the holders of shares of Convertible Preferred Stock have the right on three separate occasions to cause the Company to register their shares of Common Stock issued upon the conversion of the Convertible Preferred Stock. The holders of the Convertible Preferred Stock have an additional registration right at their own expense. National Patent will also have the right on one occasion to cause the Company to register the shares of Common Stock owned by it. Other than the one additional registration right at the expense of the holders of Convertible Preferred Stock, the Company has agreed to incur the expenses of all such registrations except for fees and expenses of counsel for the selling stockholders and any underwriters' or brokers' commissions, fees or expenses applicable to the shares being sold by such selling stockholders. 12 DIVIDEND POLICY The Company has never paid a cash dividend on its Common Stock and is currently prohibited from paying dividends under its revolving line of credit with its principal lender. The Company will pay dividends on the Convertible Preferred Stock out of funds legally available therefor in accordance with the terms of the Convertible Preferred Stock. Except with respect to the dividends on the Convertible Preferred Stock, the Company currently intends to retain earnings primarily for working capital and development of vitrification technologies. BUSINESS COMBINATIONS Section 203 of the Delaware General Corporation Law contains a provision restricting Delaware corporations, other than corporations that "opt out" of the statute, from engaging in a wide range of transactions which may be entered into by any such corporation and any interested stockholder. The Company has not opted out of Section 203. Under Section 203, the term "interested stockholder" is defined to include any person or entity who has acquired more than 15% of any class or series of stock entitled to vote generally in the election of directors but does not acquire 85% of such shares in the transaction in which more than 15% of the shares were acquired. Any such stockholder may not engage in certain "Business Combinations" with the corporation for a period of three years subsequent to the date on which the stockholder became an "interested stockholder" unless (i) the Board of Directors prior to the date the interested stockholder obtained such status approved either the "Business Combination" or the transaction in which the stockholder became an "interested stockholder," or (ii) the holders of at least two-thirds of the outstanding voting stock, excluding those shares owned by the "interested stockholder," approve the "Business Combination." Section 203 does not apply to Carlyle or National Patent. Section 203 defines "Business Combination" to encompass a wide variety of transactions with or caused by an "interested stockholder" in which the "interested stockholder" receives or could receive a benefit on other than a pro rata basis with other stockholders, including mergers, certain asset sales, certain issuances of additional shares to the "interested stockholder" in transactions with the corporation which increase the proportionate interest of the "interested stockholder" or transactions in which the "interested stockholder" receives certain other benefits. This statute could deter unfriendly offers or other efforts to obtain control of the Company that are not approved by the Board of Directors and thereby possibly deprive the stockholders of opportunities to sell their shares of Common Stock at prices higher than prevailing market prices. 13 THE SELLING SHAREHOLDERS Certain information regarding the Selling Shareholders appears in the table below. Of the 2,104,634 shares being offered by the Selling Shareholders, (i) 230,178 are being offered by J. Romeo & Co. ("Romeo"), (ii) 436,956 are being offered by Banque Scandinave en Suisse ("BSS"), (iii) 500,000 shares are being offered by ECA, (iv) 125,000 shares are being offered by each of Drs. Litovitz and Macedo and (v) 343,750 shares are being offered by each of Joseph H. Domberger (Domberger) and Jack J. Spitzer (Spitzer). The 667,134 shares being offered by Romeo and BSS were acquired by them from National Patent in the Exchange Offer pursuant to which they exchanged certain bonds held by them and issued by National Patent for shares of the Company and certain other securities all as described in an Offering Circular dated July 12, 1993. The 500,000 shares being offered by ECA are issuable upon the exercise of warrants issued by the Company to ECA. On October 15, 1993, the Company acquired from ECA all of its right, title and interest under an option (the "Option") granted from Dr. Pedro B. Macedo and Dr. Theodore A. Litovitz (collectively, the "Inventors") to ECA pursuant to which ECA had the option to acquire certain medical waste and hazardous waste vitrification technologies that had been developed or are being developed by the Inventors. In consideration of the purchase of ECA's rights under the Option, the Company paid to ECA $500,000 in cash, which was received from VEI in connection with entering into a co-license agreement, and issued to ECA warrants to purchase 500,000 shares of the Company's common stock for $4.00 per share. The warrants expire on September 30, 1997 and contain a provision that permits the Company to require a partial exercise of the warrants of up to 10,000 shares per week so long as the Company's common stock is trading at or above $6.00 per share and the shares can be sold through a broker-dealer designated by the Company for at least the greater of (x) $6.00 per share or (y) $.50 less than the last reported sales price of the Company's common stock on the day the Company notifies ECA of its intent to require the partial exercise. The warrants contain certain anti- dilution provisions which adjust the number of shares of Common Stock issuable upon the exercise of such warrants and the exercise price in the event the Company issues capital stock under certain circumstances. As a result of the Financing Transaction, the anti-dilution provision of the warrants was triggered and the Company is obligated to issue an additional 173,401 shares of Common Stock upon the exercise of the warrants and the exercise price decreased from $4.00 to $2.97 per share. The additional shares are not being registered in this prospectus. The 125,000 shares being offered by each of Drs. Macedo and Litovitz are issuable upon the exercise of options granted to Drs. Macedo and Litovitz in connection with their licensing of certain rights to radioactive waste vitrification technology to the Company. On August 17, 1992, Drs. Macedo and Litovitz entered into a license agreement with the Company pursuant to which they agreed to license to the Company certain rights to radioactive waste vitrification technology. Under the terms of that license agreement, the Company agreed to issue to each of Dr. Macedo and Litovitz options to purchase 125,000 shares of the Company's 14 Common Stock. The options expire in August 1997 and are exercisable by Drs. Litovitz and Macedo at $2.34 per share. The 343,750 shares of the Company's Common Stock to be sold by each of Spitzer and Domberger were purchased by them from the Company in connection with the transaction between the Company and VEI to jointly develop through Vitritek certain medical, hazardous and asbestos waste technologies. See "The Company- The Technology Group." In consideration of VEI agreeing to merge into Vitritek and thereby contribute, by operation of law, all of its rights under the co- license agreement and its rights to the technology for asbestos waste vitrification, the Company agreed to sell to each of Spitzer and Domberger, VEI's principal shareholders, 281,250 shares of the Company's Common Stock for a price equivalent to $4.00 per share. Payment for the shares consisted of cash for $750,000 and the rights to certain technologies valued at $750,000. Additionally, Spitzer and Domberger were each obligated to purchase an additional 62,500 shares of the Company's Common Stock within a specified time for $4.00 per share in cash. Each purchased such shares on April 5, 1994. Following the completion of this transaction, a designee of Messrs. Spitzer and Domberger joined the Company's Board of Directors. In recognition of the fact that the Selling Shareholders have acquired the Shares, either directly or upon the exercise of options or warrants, for investment and may wish to be legally permitted to sell the Shares when they deem appropriate, the Company has agreed to prepare and file with the Commission a registration statement of which this Prospectus is a part with respect to the resale of the Shares from time to time on the Nasdaq National Market, in privately-negotiated transactions or otherwise.
Shares of Common Shares Owned After Stock Owned Prior Completion of to the Offering Number of the Offering ----------------- Shares ------------------- Selling Shareholder Number % of Class Being Offered Number % of Class - ------------------- ------ ---------- ------------- ------ ---------- J. Romeo & Co. 230,178 2.6% 230,178 -0- * Banque Scandinave 436,956 5% 436,956 -0- * en Suisse Cours de Rive II 1211 Geneva 3 Switzerland Environmental Corp. 673,401 7.2% 500,000 173,401 * of America 70 Jefferson Boulevard Warwick, RI 02888 15 Dr. Pedro B. Macedo 125,000 1.4%% 125,000 -0- * Dr. Theodore A. 125,000 1.4% 125,000 -0- * Litovitz Joseph H. Domberger 343,750 4% 343,750 -0- * Jack J. Spitzer 343,750 4% 343,750 -0- * - -------------- *Less than 1%.
Dr. Macedo was a director of the Company from 1981 to 1994. The Vitreous State Laboratory of the Catholic University has been awarded and continues to be awarded contracts from the Company. Drs. Macedo and Litovitz are employed by the Catholic University and receive salaries from such institution. Drs. Macedo and Litovitz are the principal developers of the technologies licensed to the Company since its founding. Drs. Macedo and Litovitz collectively own 30% of Vitritek Holdings, LLC and have management positions with such entity, which in turn owns 50% of the stock of Vitritek. ECA was recently a party to a transaction with the Company in which it sold its rights to certain of the technologies developed by Dr. Litovitz and Macedo. Romeo and BSS have been the holders of outstanding debt securities of National Patent. Spitzer and Domberger were the principal shareholders of VEI which paid the Company $500,000 to enter into the Co-License Agreement and which was merged into Vitritek and are the principal shareholders of Vitritek Holdings, LLC, which owns 50% of Vitritek. See "The Company - The Technology Group." Other than as described in this paragraph, none of the Selling Shareholders has had any position, office or other material relationship within the past three years with the Company or any of its affiliates. PLAN OF DISTRIBUTION The Company has been advised that the Selling Shareholders may sell Shares from time to time in transactions in the Nasdaq National Market, in privately-negotiated transactions or otherwise. The Selling Shareholders may effect such transactions by selling the Shares to or through broker-dealers, and such broker-dealers may receive compensation in the form of discounts, concessions or commissions from the Selling Shareholders or the purchasers of the Shares for whom such broker-dealers may act as agent or to whom they sell as principal, or both (which compensation to a particular broker-dealer might be in excess of customary commissions). The Selling Shareholders and any broker-dealers who act in connection with the sale of Shares hereunder may be deemed to be "underwriters" as that term is defined in the Securities Act, and any commissions received by them and profit on any resale of the Shares as 16 principal might be deemed to be underwriting discounts and commissions under the Securities Act. National Patent will bear the expenses of registration of the Shares under the Securities Act to be sold or distributed by Romeo and BSS (estimated at $25,000). The Company will bear the expenses of registration of the Shares under the Securities Act to be sold by ECA, Drs. Litovitz and Macedo and Spitzer and Domberger (estimated at $40,000). LEGAL MATTERS The legality of the Shares to be sold or distributed by Romeo and BSS will be passed upon for the Company by Lawrence M. Gordon, Esquire, Vice President and General Counsel of National Patent. The legality of the Shares to be sold by ECA, Drs. Litovitz and Macedo and Spitzer and Domberger will be passed upon for the Company by Piper & Marbury, L.L.P., Baltimore, Maryland. EXPERTS The Company's consolidated financial statements and schedule as of December 31, 1994 and 1993 and for each of the years in the three-year period ended December 31, 1994 included in its Annual Report on Form 10-K for the year ended December 31, 1994 have been audited by KPMG Peat Marwick LLP, independent certified public accountants, as set forth in their report included therein and incorporated herein by reference. Such consolidated financial statements and schedule are incorporated herein by reference in reliance upon such report, and upon the authority of such firm as experts in accounting and auditing. 17 ---------- PROSPECTUS ---------- May 5, 1995 2,104,634 SHARES GTS DURATEK, INC. COMMON STOCK No one has been authorized to give any information or to make any respresentations not contained in this Prospectus regarding the Company or the offering made hereby and, if given or made, such information or representations must not be relied upon as having been authorized by the Company. This Prospectus does not constitute an offer to sell, or solicitation of an offer to buy, any securities other than those to which it relates, nor does it constitute an offer to or solicitation of any person in any jurisdiction in which such offer or solicitation would be unlawful. Neither the deliver of this Prospectus at any time nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the Company since the date hereof or that the information contained herein is correct at any time subsequent to the date hereof. ----------------------- TABLE OF CONTENTS Page ---- Available Information. . . . . . . . . . . . . . . . . . . . . . . . 2 Incorporation of Certain Documents by Reference . . . . . . . . . . . . . . . . . . . . . . 2 The Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Additional Information about the Company . . . . . . . . . . . . . . 5 Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Description of Capital Stock . . . . . . . . . . . . . . . . . . . . 11 The Selling Shareholders . . . . . . . . . . . . . . . . . . . . . . 14 Plan of Distribution . . . . . . . . . . . . . . . . . . . . . . . . 16 Legal Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Experts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION The estimated expenses in connection with the offering are as follows:
SEC registration fee . . . . . . . . . . . . . . . . . . $ 2,673 Legal fees and expenses . . . . . . . . . . . . . . . . . 32,500 Accounting fees and expenses. . . . . . . . . . . . . . . 27,500 Miscellaneous . . . . . . . . . . . . . . . . . . . . . . 2,327 ------ TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . $65,000 ------- -------
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS Section 145(a) of the General Corporation Law of the State of Delaware (the "DGCL") provides that a Delaware corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that he is or was a director, officer, employee or agent of the corporation or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or enterprise, against expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding 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 cause to believe his conduct was unlawful. Section 145(b) of the DGCL provides that a Delaware corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that such person acted in any of the capacities set forth above, against expenses actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted under similar standards, 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 for negligence or misconduct in the performance of his duty to the corporation unless and only to the extent that the court in which such action or suit was brought shall determine that despite the adjudication of liability, such person is fairly and reasonably entitled to indemnify for such expenses which the court shall deem proper. II-1 Section 145 of the DGCL further provides that to the extent a director or officer of a corporation has been successful in the defense of any action, suit or proceeding referred to in subsections (a) and (b) of such section or in the defense of any claim, issue or matter therein, he shall be indemnified against expenses actually and reasonably incurred by him in connection therewith; that indemnification provided for by Section 145 shall not be deemed exclusive of any other rights to which the indemnified party may be entitled; and that the corporation may purchase and maintain insurance on behalf of a director or officer of the corporation against any liability asserted against him or incurred by him in any such capacity or arising out of his status as such whether or not the corporation would have the power to indemnify him against such liabilities under Section 145. The Company's amended and restated Certificate of Incorporation provides for indemnification of directors and officers to the fullest extent permitted by Delaware law. The directors of the Company may not be held liable to the Company or its shareholders for monetary damages for a breach of his or her fiduciary duty as a director, except for a breach of the director's duty of loyalty, for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, for willful or negligent violation of sections 160 or 173 of the DGCL respecting unlawful payment of dividends and unlawful stock purchases and redemptions, or for any transaction from which the director derived an improper personal benefit. ITEM 16. EXHIBITS 4(a) Specimen Common Stock Certificate (filed as Exhibit 1.2 to the Company's Registration Statement (Registration No. 33-2062), and incorporated by reference herein) 4(b) Restated Certificate of Incorporation (filed as Exhibit 3.1 to the Company's Annual Report on Form 10-K for the year ended December 31, 1992 and incorporated by reference herein) 4(c) By-Laws (filed as Exhibit 3.2 to the Company's Registration Statement (Registration No. 33-2062) and incorporated by reference herein) 4(d) Amended and Restated Certificate of Incorporation of the Registrant (filed as Exhibit 3.6 to the Company's Annual Report on Form 10-K for the year ended December 31, 1994 and incorporated by reference herein) 4(e) Certificate of Designations of the 8% Cumulative Convertible Redeemable Preferred Stock dated January 23, 1995 (filed as Exhibit 4.1 to the Registrant's Current Report on Form 8-K No. 014292) 5.1 Opinion of Lawrence M. Gordon, Esquire (previously filed) 5.2 Opinion of Piper & Marbury, L.L.P. (previously filed) 24(a) Consent of KPMG Peat Marwick LLP (filed herewith) 24(b) Consent of Lawrence M. Gordon, Esquire (included in Exhibit 5.1). 24(c) Consent of Piper & Marbury, L.L.P. (included in Exhibit 5.2) 25 Power of Attorney (located on p. II-5 of the Registration Statement) II-2 ITEM 17. UNDERTAKINGS (a) The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement; (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933, as amended (the "Securities Act"); (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post- effective amendment by those paragraphs is contained in periodic reports filed by the registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act") that are incorporated by reference in the registration statement. (2) That for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial BONA FIDE offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned registrant hereby undertakes 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 are 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 II-3 specifically incorporated by reference in the prospectus to provide such interim financial information. (c) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions of the Delaware General Corporate Law, the Restated Certificate of Incorporation or By-Laws of the registrant or resolutions of the Board of Directors of the registrant adopted pursuant thereto, 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 Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such 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 of whether such indemnification by is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. II-4 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-2 and has duly caused this Registration Statement on Form S-2 to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Columbia, State of Maryland, on May 5, 1995. GTS DURATEK, INC. By: /s/ Robert F. Shawver ------------------------------------ Robert F. Shawver Vice President and Chief Financial Officer SIGNATURE PAGE AND POWER OF ATTORNEY Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities indicated on May 5, 1995. Each of the undersigned officers and directors of the registrant hereby constitutes Robert E. Prince and Robert F. Shawver, either of whom may act, his true and lawful attorneys-in-fact with full power to sign for him and in his name in the capacities indicated below and to file any and all amendments to the registration statement filed herewith, making such changes in the registration statement as the registrant deems appropriate, and generally to do all such things in his name and behalf in his capacity as an officer and director to enable the registrant to comply with the provisions of the Securities Act of 1933 and all requirements of the Securities and Exchange Commission. Signature Title and Capacity - --------- ------------------ /s/ Daniel A. D'Aniello Chairman of the Board of Directors - --------------------------------- Daniel A. D'Aniello II-5 /s/ William E. Conway Director - ---------------------------------- William E. Conway /s/ Jerome I. Feldman Director - ---------------------------------- Jerome I. Feldman /s/ Martin M. Pollak Director - ---------------------------------- Martin M. Pollak /s/ Earle C. Williams Director - ---------------------------------- Earle C. Williams /s/ Steven J. Gilbert Director - ---------------------------------- Steven J. Gilbert /s/ Robert E. Prince President and Chief Executive - ---------------------------------- Officer and Director Robert E. Prince /s/ Robert F. Shawver Vice President, Chief - ---------------------------------- Financial Officer and Director Robert F. Shawver (Principal Financial Officer) /s/ Craig T. Bartlett Controller (Principal - ---------------------------------- Accounting Officer) Craig T. Bartlett II-6 EXHIBIT INDEX (EXHIBITS DESCRIBED IN ITEM 16 AND LISTED IN THIS INDEX ARE INCORPORATED BY REFERENCE.) Sequentially Exhibit Document Numbered Page - ------- -------- ------------- 5.1 Opinion of Lawrence M. Gordon, Esquire * 5.2 Opinion of Piper & Marbury, L.L.P. * 24(a) Consent of KPMG Peat Marwick LLP ** 24(b) Consent of Piper & Marbury, L.L.P. (included in * Exhibit 5.2) *Previously filed. **Filed herewith. II-7 EXHIBIT 24(a) CONSENT OF INDEPENDENT AUDITORS The Board of Directors GTS Duratek, Inc.: We consent to the use of our report dated February 27, 1995 included in the Company's Annual Report on Form 10-K for the year ended December 31, 1994 incorporated herein by reference and to the reference to our firm under the heading "Experts" in the Prospectus. /s/ KPMG PEAT MARWICK LLP Baltimore, Maryland May 4, 1995 -----END PRIVACY-ENHANCED MESSAGE-----