<PAGE>
As filed with the Securities and Exchange Commission on May 5, 1997
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------
REGISTRATION STATEMENT ON FORM S-3
UNDER
THE SECURITIES ACT OF 1933
------------------------
ICF KAISER INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Delaware 54-1437073
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9300 Lee Highway
Fairfax, Virginia 22031-1207
(703) 934-3600
(Address, including zip code, and telephone number, including area
code, of registrant's principal executive offices)
------------------------
Paul Weeks, II, Esq.
Senior Vice President, General Counsel and Secretary
ICF Kaiser International, Inc., 9300 Lee Highway, Fairfax, Virginia 22031-1207
(703) 934-3600
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
------------------------
Approximate date of commencement of proposed sale to the public. From
time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans, please check the
following box: [_]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box: [X]
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [_]
------------------------
<PAGE>
<TABLE>
<CAPTION>
Calculation of Registration Fee
Title Proposed Maximum Proposed Maximum
of Each Class of Securities Offering Price Aggregate Offering Amount of
to be Registered Amount to be Registered per Share Price Registration Fee
- ------------------------------------ ------------------------ ------------------- -------------------- -------------------
<S> <C> <C> <C> <C>
Common Stock 105,000 shares (1) $2.00 (2) $210,000 (2) $63.64
Preferred Stock Purchase Rights (3) n/a n/a n/a
</TABLE>
(1) Such shares of Common Stock are issuable upon exercise of the Warrants
described in this Registration Statement.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(g)(3) under the Securities Act based on the average of
the high and low prices of the Common Stock on the New York Stock Exchange
on May 1, 1997.
(3) Each share of Common Stock issued by the Registrant has one associated
non-detachable Preferred Stock Purchase Right.
-------------------------
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 Section 8(a), may
determine.
<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION, OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED MAY 5, 1997
PROSPECTUS
105,000 Shares of Common Stock
ICF Kaiser International, Inc.
-------------------------
The 105,000 shares of ICF Kaiser International, Inc. ("ICF Kaiser" or
the "Company") Common Stock, par value $0.01 per share (the "Common Stock"),
being offered hereby are issuable upon exercise of 105,000 warrants (the
"Warrants"). The Warrants were sold on December 23, 1996, as part of a private
offering of Units (as defined below) to BT Securities Corporation (the "Initial
Purchaser") pursuant to a Purchase Agreement dated December 19, 1996. Each Unit
consisted of $1,000 principal amount of the Registrant's 12% Senior Notes due
2003, Series A (the "Notes"), and seven Warrants, each to purchase one share of
Common Stock. The Notes and the Warrants are separately transferable. On March
7, 1997, the outstanding Notes were exchanged in a registered offering for 12%
Senior Notes due 2003, Series B (SEC Registration No. 333-19519).
A total of 105,000 Warrants were sold as described above. Each
Warrant entitles the holder thereof to purchase one share of Common Stock at a
price equal to $2.30 per share, subject to adjustment under certain
circumstances. Prior to their expiration on December 31, 1999, the Warrants are
exercisable at any time for shares of Common Stock. The 105,000 shares were
listed on The New York Stock Exchange, Inc. effective January 27, 1997.
ICF Kaiser's Common Stock is traded on the New York Stock Exchange
under the symbol "ICF". The last sale price reported for such Common Stock on
May 1, 1997, as reported by the New York Stock Exchange, was $2.00.
See "Risk Factors" beginning on page 5 of this Prospectus for certain
considerations relevant to an investment in the Common Stock.
-------------------------
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.
-------------------------
<TABLE>
<CAPTION>
Price to Public Proceeds to Company (1)
------------------------ --------------------------------
<S> <C> <C>
Per Share (on exercise of Warrants) $2.30 $2.30
Total $241,500 $237,436.36
</TABLE>
(1) Before deducting expenses, payable by the Company, estimated at $4,063.64
The date of this Prospectus is May , 1997.
<PAGE>
TABLE OF CONTENTS
Available Information .............................................2
Incorporation of Certain Documents by Reference....................3
The Company........................................................4
Risk Factors.......................................................5
Selected Consolidated Financial Data..............................10
Use of Proceeds...................................................11
Legal Matters.....................................................11
Experts...........................................................11
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 and other information with the Securities and
Exchange Commission ("Commission"). Reports, proxy and information statements,
and other information filed by the Company can be inspected at the Commission's
Public Reference Room, 450 Fifth Street, N.W., Washington, D.C. 20549, and at
the following Regional Offices of the Commission: Northeast Regional Office, 7
World Trade Center, Suite 1300, New York, New York 10048; and Midwest Regional
Office, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of
each such document may be obtained from the Commission at the Public Reference
Section of the Commission's principal office in Washington, D.C. upon payment of
the charges prescribed by the Commission. The Commission also maintains a Web
site at http://www.sec.gov that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the Commission. The Company is such an electronic filer.
The Company has filed with the Commission a Registration Statement
under the Securities Act of 1933, as amended (the "Securities Act") with respect
to the Common Stock offered hereby (the "Registration Statement"). As permitted
by the rules and regulations of the Commission, this Prospectus does not contain
all the information set forth in the Registration Statement and in the exhibits
thereto and is qualified by reference to such exhibits for a complete statement
of their respective terms and conditions.
The Company's Common Stock is listed on the New York Stock Exchange,
Inc. and trades under the symbol "ICF." Reports, proxy and information
statements, and other information concerning the Company can be inspected at the
New York Stock Exchange, Inc. 20 Broad Street, New York, NY 10005.
------------------
No dealer, salesman, or other person has been authorized to give any
information or to make any representation not contained in this Prospectus and,
if given or made, such information or representation must not be relied upon as
having been authorized by the Company. This Prospectus does not constitute an
offer to sell or a solicitation of an offer to buy any of the securities offered
hereby in any jurisdiction to any person to whom it is unlawful to make such
offer or solicitation in such jurisdiction. Neither the delivery of this
Prospectus 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 other information contained herein is correct at any
time subsequent to the date hereof.
2
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents have been filed by the Company with the
Commission pursuant to the Exchange Act (File No. 1-12248) and are incorporated
herein by reference and made a part hereof:
(1) the Company's Annual Report on Form 10-K for the year ended
December 31, 1996, together with Amendment No. 1 thereto filed
with the Commission on April 21, 1997;
(2) the Company's Report on Form 8-K (Date of Report: December 31,
1996) filed with the Commission on January 15, 1997;
(3) the Company's Report on Form 8-K (Date of Report: January 30,
1997) filed with the Commission on February 10, 1997; and
(4) the description of capital stock found on pages 48-56 of the
Prospectus filed with the Commission on November 27, 1996, as
part of the Company's Registration Statement on Form S-1
(Registration No. 333-16937).
All documents filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of filing of this
Prospectus and prior to the termination of the offering of the Common Stock
covered by this Prospectus are deemed to be incorporated by reference and shall
be a part hereof from their respective dates of filing.
Any statement contained in a document incorporated by reference
herein shall be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained in this Prospectus or in any
other subsequently filed document which also is 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 will provide, without charge, to each person to whom a
copy of this Prospectus is delivered, upon written or oral request, a copy of
any and all of the information that has been incorporated by reference in this
Prospectus, but not including exhibits to such information unless such exhibits
are specifically incorporated by reference into the information that this
Prospectus incorporated. Requests for copies of such information should be
directed to Paul Weeks, II, Senior Vice President, General Counsel and
Secretary, ICF Kaiser International, Inc., 9300 Lee Highway, Fairfax, Virginia
22031, telephone number (703) 934-3040.
3
<PAGE>
THE COMPANY
ICF Kaiser International, Inc., through ICF Kaiser Engineers, Inc.
and its other operating subsidiaries, is one of the nation's largest
engineering, construction, program management, and consulting services
companies. The Company's Federal Programs, ICF Kaiser Engineers & Constructors,
and Consulting Groups provide fully integrated services in the public and
private sector of the environment, infrastructure, energy, and basic metals and
mining industry markets. The "Company" or "ICF Kaiser" in this Prospectus refers
to ICF Kaiser International, Inc. and/or any of its consolidated subsidiaries.
Effective December 31, 1995, the Company changed its fiscal year end from
February 28 to December 31.
For the year ended December 31, 1996, ICF Kaiser reported gross and
service revenue of $1,248.4 million and $532.1 million, respectively. Service
revenue is derived by deducting the costs of subcontracted services and direct
project costs from gross revenue and adding the Company's share of the equity in
income of unconsolidated joint ventures and affiliated companies. During the
year ended December 31, 1996, the ten months ended December 31, 1995, and the
year ended February 28, 1995, the Company operated predominantly in one industry
segment, in which it provided engineering, construction, program management,
consulting, and other professional services. For the year ended December 31,
1996, approximately 70% of the Company's consolidated gross revenue came from
the U.S. Department of Energy ("DOE"); other Federal agencies collectively
accounted for another approximately 10%.
<TABLE>
<CAPTION>
Year Ended Ten Months Ended Year Ended
December 31, 1996 December 31, 1995 February 28, 1995
----------------- ----------------- -----------------
<S> <C> <C> <C>
Gross revenue..................... $1,248,443,000 $916,744,000 $861,518,000
Service revenue................... $ 532,116,000 $425,896,000 $459,786,000
Operating income.................. $ 21,180,000 $ 17,505,000 $ 13,688,000
Assets............................ $ 365,973,000 $369,517,000 $281,422,000
</TABLE>
As of December 31, 1996, the Company's contract backlog totaled
approximately $4.7 billion compared to $4.4 billion as of December 31, 1995.
Most of the Company's backlog relates to public-sector environmental projects
that span from one to five years. Approximately 20% of the $4.7 billion backlog
is expected to be worked off during the fiscal year ending December 31, 1997.
The Company's headquarters is located at 9300 Lee Highway, Fairfax,
Virginia 22031-1207, and its telephone number is (703) 934-3600. The Company's
five regional headquarters are located at 1800 Harrison St., Oakland, California
94612-3430 Telephone (510) 419-6000; Gateway View Plaza, 1600 West Carson St.,
Pittsburgh, Pennsylvania 15220 Telephone (412) 497-2000; 5718 Westheimer, Suite
1000, Houston, TX 77057 Telephone (713) 735-2900; Q.V. 1 Building, George's
Terrace, Perth, WA 6000, Australia Telephone 61-9-366-5366; and Regal House,
London Road, Twickenham, Middlesex, TW1-3QQ, England Telephone 44-181-892-4433.
Other offices include Livermore, Los Angeles, Rancho Cordova, San Diego, San
Francisco, San Rafael, and Universal City, California; Golden and Lakewood,
Colorado; Washington, DC; Ft. Lauderdale and Miami, Florida; Chicago, Illinois;
Ruston, Louisiana; Abington, Baltimore, Beltsville, Edgewood, and Lexington
Park, Maryland; Boston, Massachusetts; Las Vegas, Nevada; Iselin, New Jersey;
Albuquerque and Los Alamos, New Mexico; New York, New York; Richmond, Virginia;
Richland and Seattle, Washington. The Company's other international offices are
located in Brisbane and Sydney, Australia; Ostrava and Prague, Czech Republic;
Paris, France; Hong Kong; Budapest, Hungary; Mexico City, Mexico; Manila, the
Philippines; Lisbon, Portugal; Moscow, Russia; and Taipei, Taiwan.
ICF Kaiser International, Inc. is a Delaware corporation incorporated
in 1987 under the name American Capital and Research Corporation. It is the
successor to ICF Incorporated, a nationwide consulting firm organized in 1969.
In 1988, the Company acquired the Kaiser Engineers business which dates from
1914. As of February 28, 1997, ICF Kaiser employed 5,047 persons.
4
<PAGE>
RISK FACTORS
Prospective purchasers of the Common Stock should carefully consider
the following, as well as other information contained in and incorporated in
this Prospectus.
Company is Highly Leveraged
At December 31, 1996, the Company had total indebtedness of $156.6
million, representing 79.2% of total capitalization. Effective March 8, 1996,
the Company agreed to increase the interest rate on the Company's 12% Senior
Subordinated Notes due 2003 (the "Senior Subordinated Notes") by one percent
until the Company achieves and maintains a specified level of earnings as
defined in the Fourth Supplemental Indenture to the Indenture dated as of
January 11, 1994 (as such Indenture has been and may be amended, restated,
supplemented or otherwise modified from time to time, the "1994 Indenture")
governing the Senior Subordinated Notes. The Indenture dated December 23, 1996
("1996 Indenture") governing the Company's 12% Senior Notes due 2003, Series B
("Senior Notes") contains an identical increased interest rate provision. The
Senior Subordinated Notes and the Senior Notes together are referred to as the
"Notes" in this Prospectus.
The degree to which the Company is leveraged could have important
consequences to the Company's security holders, including, but not limited to,
the following: (i) the Company's ability to obtain additional financing in the
future for working capital, capital expenditures, acquisitions, general
corporate, or other purposes may be limited; (ii) a substantial portion of the
Company's cash flow from operations will be dedicated to the payment of the
principal of, and interest on, its debt; (iii) the agreements governing the
Company's long-term debt contain certain restrictive financial and operating
covenants which could limit the Company's ability to compete as well as its
ability to expand; (iv) the Company's substantial leverage may make it more
vulnerable to economic downturns and reduce its flexibility in responding to
changing business and economic conditions; and (v) the level of the Company's
leverage may make it more difficult for the Company to obtain performance and
similar bonds. The ability of the Company to pay interest and principal on the
Notes and to satisfy its other debt obligations will be dependent on the future
operating performance of the Company, which could be affected by changes in
economic conditions and other factors, including factors beyond the control of
the Company. A failure to comply with the covenants and other provisions of its
debt instruments could result in events of default under such instruments, which
could permit acceleration of the debt under such instruments and in some cases
acceleration of debt under other instruments that contain cross-default or
cross-acceleration provisions.
If the Company is unable to generate sufficient cash flow to meet its
debt obligations, the Company may be required to renegotiate the terms of the
instruments relating to its long-term debt or to refinance all or a portion of
its long-term debt. However, there can be no assurance that the Company will be
able to successfully renegotiate such terms or refinance its indebtedness, or,
if the Company were able to do so, that the terms available would be favorable
to the Company. In the event that the Company were unable to refinance its
indebtedness or obtain new financing under these circumstances, the Company
likely would have to consider various other options such as the sale of certain
assets to meet its required debt service, negotiation with its lenders to
restructure applicable indebtedness, or other options available to it under law.
History of Net Losses
As shown in the following table, for two of the past five fiscal
years, the Company has had net losses (dollars in thousands).
<TABLE>
<CAPTION>
Year Ten Months
Ended Ended Year Ended February 28,
December 31, December 31, ---------------------------------
1996 1995 1995 1994 1993
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net income (loss) $ 5,834 $ 2,252 $(1,661) $ (18,497) $ 8,639
Net income (loss) available 3,656 449 (3,815) (25,322) 3,346
for common shareholders
</TABLE>
5
<PAGE>
Limited Ability to Incur Additional Debt
Excluding borrowings under the Company's Credit Facility dated as of
May 6, 1996, as amended with a consortium of banks (with CoreStates Bank, N.A.,
as Agent) (the "Credit Facility"), the 1994 Indenture and the 1996 Indenture
(together, the "Indentures") limit the Company's ability to incur additional
Indebtedness (as defined). The amount of available additional Indebtedness may
be insufficient for working capital needs, potential acquisitions, significant
capital expenditures, repayment of debt, or other purposes.
Company Dependent on Federal Government Contracts
A substantial portion of ICF Kaiser's revenues are derived from
services performed directly or indirectly under contracts with various agencies
and departments of the federal government. During the year ended December 31,
1996, approximately 80% of the Company's consolidated gross revenue was derived
from contracts with the U.S. Government. During that year, the DOE accounted for
approximately 70% of consolidated gross revenue, and other federal agencies
collectively accounted for approximately 10% of the Company's consolidated gross
revenue.
Contracts made with the U.S. government generally are subject to
annual approval of funding. Limitations imposed on spending by federal
government agencies, which might result from efforts to reduce the federal
deficit or for other reasons, may limit the continued funding of the Company's
existing federal government contracts and may limit the ability of the Company
to obtain additional contracts. These limitations, if significant, could have a
material adverse effect on the Company.
The Company has a substantial number of cost-reimbursement contracts
with the U.S. government, the costs of which are subject to audit by the U.S.
government. As a result of pending audits relating to fiscal years 1986 forward,
the government has asserted, among other things, that certain costs claimed as
reimbursable under government contracts either were not allowable or not
allocated in accordance with federal procurement regulations. The Company is
actively working with the government to resolve these issues. The Company has
provided for its estimate of the potential effect of issues that have been
quantified, including its estimate of disallowed costs for the periods currently
under audit and for periods not yet audited. Many of the issues, however, have
not been quantified by the government or the Company, and others are qualitative
in nature, and their potential financial impact, if any, is not quantifiable by
the government or the Company at this time. This provision will be reviewed
periodically as discussions with the government progress.
All federal contracts may be terminated by the U.S. government at any
time, with or without cause. There can be no assurance that existing or future
federal government contracts would not be terminated or that the government will
continue to use the Company's services at levels comparable to current use.
Risk Associated with Company's Pledge of Assets
The Company and most of its subsidiaries have granted a security
interest in substantially all of their accounts receivable and certain other
assets to secure all debt incurred pursuant to the Credit Facility. The Company
would not be able to incur additional debt (including additional debt permitted
by the Credit Facility and Indentures) if the Company were required to pledge
assets in connection with the incurrence of such additional Indebtedness.
Limited Ability to Make Acquisitions and Other Investments
The Credit Facility limits the Company's ability to make acquisitions
and other investments, and the Indentures limit the Company's ability to make
restricted payments, including certain payments in connection with investments
and acquisitions. Limitations in the 1994 Indenture are based in part on the
Company's Consolidated Net Income (as defined) during the period since August
31, 1993; the losses incurred by the Company during fiscal 1994 and 1995 have
the effect of making this limitation very restrictive.
6
<PAGE>
The indebtedness, investment, acquisition, and restricted payment
limitations in the Credit Facility and the Indentures discussed above mean that
during the next several years, unless the Credit Facility and Indentures are
amended, it likely will be necessary for the Company to issue additional equity
securities to fund any significant acquisitions and to invest significant
amounts in joint ventures. These limitations may make it more difficult for the
Company to compete effectively in its markets.
Limitations on Change of Control
In the event of a Change of Control, as defined in the Indentures,
the Company would be required, subject to certain conditions, to offer to
purchase all outstanding Notes at a price equal to 101% of the principal amount
thereof, plus accrued and unpaid interest, if any, thereon to the date of
purchase. As of December 31, 1996, the Company did not have sufficient funds
available to purchase all of the Notes were they to be tendered in response to
an offer made as a result of such a Change of Control. There can be no assurance
that, at the time of a Change of Control, the Company will have sufficient cash
to repay all amounts due under the Notes. If, following a Change of Control, the
Company has insufficient funds to purchase all of the Notes tendered pursuant to
such an offer, an event of default in respect of such Notes would occur which
could result in cross-default or cross-acceleration under other debt
instruments. The Change of Control provisions of the Indentures may have the
effect of discouraging attempts by a person or group to take control of the
Company.
The Company's Restated Certificate of Incorporation, By-laws,
Shareholder Rights Plan, and certain other agreements contain provisions that
could have the effect of delaying or preventing a change of control of the
Company or affect the Company's ability to engage in certain extraordinary
transactions.
Company Dependent on Governmental Environmental Regulation Continuing
A substantial portion of the Company's business has been generated
either directly or indirectly as a result of federal and state laws,
regulations, and programs related to environmental issues. Accordingly, a
reduction in the number or scope of these laws and regulations, or changes in
government policies regarding the funding, implementation, or enforcement of
such laws, regulations, and programs, could have a material adverse effect on
the Company's business. In addition, any significant effort by the DOE to reduce
the role of private contractors in environmental projects could have a material
adverse effect on the Company.
Potential Environmental Liability
The assessment, analysis, remediation, handling, management, and
disposal of hazardous substances necessarily involve significant risks,
including the possibility of damages or personal injuries caused by the escape
of hazardous materials into the environment, and the possibility of fines,
penalties, or other regulatory action. These risks include potentially large
civil and criminal liabilities for violations of environmental laws and
regulations, and liabilities to customers and to third parties for damages
arising from performing services for clients.
Potential Liabilities Arising Out of Environmental Laws and
Regulations
All facets of the Company's business are conducted in the context of
a rapidly developing and changing statutory and regulatory framework. The
Company's operations and services are affected by and subject to regulation by a
number of federal agencies, including EPA and the Occupational Safety and Health
Administration, as well as applicable state and local regulatory agencies.
The Comprehensive Environmental Response, Compensation, and Liability
Act ("CERCLA") of 1980, as amended by the Superfund Amendments and
Reauthorization Act of 1986, addresses cleanup of sites at which there has been
a release or threatened release of hazardous substances into the environment.
Increasingly, there are efforts to expand the reach of CERCLA to make
environmental contractors responsible for cleanup costs by claiming that
environmental contractors are owners or operators of hazardous waste facilities
or that they arranged for treatment, transportation, or disposal of hazardous
substances. Several recent court decisions have accepted these claims. Should
the Company be held responsible under CERCLA for damages caused while performing
services or otherwise, it may
7
<PAGE>
be forced to bear such liability by itself, notwithstanding the potential
availability of contribution or indemnity from other parties.
The Resource Conservation and Recovery Act ("RCRA") of 1976, as
amended by the Hazardous and Solid Waste Amendments of 1984 ("HSWA"), governs
hazardous waste generation, treatment, transportation, storage, and disposal.
RCRA, or EPA-approved state programs at least as stringent, govern waste
handling activities involving wastes classified as "hazardous." Substantial fees
and penalties may be imposed under RCRA and similar state statutes for any
violation of such statutes and the regulations thereunder.
Potential Environmental Liabilities Involving Clients and Third
Parties
In performing services for its clients, the Company could potentially
be liable for breach of contract, personal injury, property damage, and
negligence (including improper or negligent performance or design, failure to
meet specifications, and breaches of express or implied warranties). The damages
available to a client, should it prevail in its claims, are potentially large
and could include consequential damages.
Environmental contractors, in connection with work performed for
clients, potentially face liabilities to third parties from various claims,
including claims for property damage or personal injury stemming from a release
of hazardous substances or otherwise. Claims for damage to third parties could
arise in a number of ways, including through a sudden and accidental release or
discharge of contaminants or pollutants during the performance of services;
through the inability, despite reasonable care, of a remedial plan to contain or
correct an ongoing seepage or release of pollutants; through the inadvertent
exacerbation of an existing contamination problem; or through reliance on
reports or recommendations prepared by the Company. Personal injury claims could
arise contemporaneously with performance of the work or long after completion of
the project as a result of alleged exposure to toxic or hazardous substances. In
addition, increasing numbers of claimants assert that companies performing
environmental remediation should be adjudged strictly liable, i.e., liable for
damages even though its services were performed using reasonable care, on the
grounds that such services involved "abnormally dangerous activities."
Clients frequently attempt to shift various liabilities arising out
of remediation of their own environmental problems to contractors through
contractual indemnities. Such provisions seek to require the Company to assume
liabilities for damage or personal injury to third parties and property and for
environmental fines and penalties. The Company has endeavored to protect itself
from potential liabilities resulting from pollution or environmental damage by
obtaining indemnification from its private-sector clients and intends to
continue this practice in the future. Under most of these contracts, the Company
has been successful in obtaining such indemnification; however, such
indemnification generally is not available if such liabilities arise as a result
of breaches by the Company of specified standards of care or if the indemnifying
party has insufficient assets to cover the liability. The Company's subsidiary,
ICF Kaiser Remediation Company, is the entity through which the Company intends
to increase its remediation activities performed for public- and private-sector
clients. The Company will continue its efforts to minimize the risks and
potential liability associated with its remediation activities by performing all
remediation contracts in a professional manner and by carefully reviewing any
and all remediation contracts it signs in an effort to ensure that its
environmental clients accept responsibility for their own environmental
problems.
For EPA contracts involving field services in connection with
Superfund response actions, the Company is eligible for indemnification under
Section 119 of CERCLA for pollution and environmental damage liability resulting
from release or threatened release of hazardous substances. Some of the
Company's clients (including private clients, DOE, and the U.S. Department of
Defense) are Potentially Responsible Parties (PRPs) under CERCLA. Under the
Company's contracts with these PRPs, the Company has the right to seek
contribution from these PRPs for liability imposed on the Company in connection
with its work at these clients' CERCLA sites and generally qualifies for the
limitations on liabilities under CERCLA Section 119(a). In addition, in
connection with contracts involving field services at 10 of DOE's weapons
facilities, including the DOE's Hanford site, the Company is indemnified under
the Price-Anderson Act, as amended, against liability claims arising out of
contractual activities involving a nuclear incident. Recently, EPA has
constricted significantly the circumstances under which it will indemnify its
contractors against liabilities incurred in connection with CERCLA projects.
There are other proposals both in Congress and at the regulatory agencies to
further restrict indemnification of contractors from third-party claims.
8
<PAGE>
The Company, through Kaiser-Hill Company, LLC, a limited liability
company owned equally by the Company and CH2M Hill Companies, Ltd.
("Kaiser-Hill"), performs DOE's Performance Based Integrating Management
Contract at DOE's Rocky Flats Environmental Technology Site near Denver,
Colorado. Rocky Flats is a former DOE nuclear weapons production facility. Under
Kaiser-Hill's contract with the DOE, Kaiser-Hill is not responsible for, and DOE
pays all costs associated with, any liability (including without limitation, a
claim involving strict or absolute liability and any civil fine or penalty,
expense, or remediation cost, but limited to those of a civil nature), which may
be incurred by, imposed on, or asserted against Kaiser-Hill arising out of any
act or failure to act, condition, or exposure which occurred before Kaiser-Hill
assumed responsibility at the site on July 1, 1995 ("pre-existing conditions").
To the extent the acts or omissions of Kaiser-Hill constitute willful
misconduct, lack of good faith, or failure to exercise prudent business judgment
on the part of Kaiser-Hill's managerial personnel and cause or add to any
liability, expense, or remediation cost resulting from pre-existing conditions,
Kaiser-Hill is responsible, but only for the incremental liability, expense, or
remediation caused by Kaiser-Hill.
The Kaiser-Hill contract further provides that Kaiser-Hill shall be
reimbursed for the reasonable cost of bonds and insurance allocable to the Rocky
Flats contract and for liabilities (and expenses incidental to such liabilities,
including litigation costs) to third parties not compensated by insurance or
otherwise. The exception to this reimbursement provision applies to liabilities
caused by the willful misconduct or lack of good faith of Kaiser-Hill's
managerial personnel or the failure to exercise prudent business judgment by
Kaiser-Hill's managerial personnel.
In connection with its services to its environmental, infrastructure,
and industrial clients, the Company works closely with federal and state
government environmental compliance agencies, and occasionally contests the
conclusions those agencies reach regarding the Company's compliance with permits
and related regulations. To date, the Company never has paid a fine in a
material amount or had liability imposed on it for pollution or environmental
damage in connection with its services; however, there can be no assurance that
the Company will not have substantial liability imposed on it for any such
damage in the future.
Highly Competitive Market for Company's Services
The market for the Company's services is highly competitive. The
Company and its subsidiaries compete with many other environmental consulting,
engineering and construction firms ranging from small firms to large
multinational firms having substantially greater financial, management, and
marketing resources than the Company. Other competitive factors include quality
of services, technical qualifications, reputation, geographic presence, price,
and the availability of key professional personnel.
Risks Associated with Company's Ability to Attract and Retain Professional
Personnel
The Company's ability to retain and expand its staff of qualified
professionals is an important factor in determining the Company's future
success. The market for these professionals, especially environmental
professionals, is competitive. There can be no assurance that the Company will
continue to be successful in its efforts to attract and retain such
professionals.
Fluctuations in Quarterly Financial Results
The Company's quarterly financial results may be affected by a number
of factors, including the commencement, completion, or termination of major
projects. Accordingly, results for any one quarter are not necessarily
indicative of results for any other quarter or for the year.
9
<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA
The selected consolidated financial data of the Company for the year
ended December 31, 1996, the ten months ended December 31, 1995, and each year
in the three-year period ended February 28, 1995, have been derived from the
Company's audited consolidated financial statements. This information should be
read in conjunction with the consolidated financial statements and the related
notes thereto appearing in the Company's Annual Report on Form 10-K for the year
ended December 31, 1996, which has been incorporated by reference into this
Prospectus. Certain reclassifications have been made to the prior period
financial statements to conform to the presentation used in the December 31,
1996, financial statements.
<TABLE>
<CAPTION>
(in thousands, except per share data)
Ten Months
Year Ended Ended
December 31, December 31, Year Ended February 28,
---------------------------------
1996 1995 1995 1994 (1) 1993
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Statement of Operations Data:
Gross revenue.............................................. $ 1,248,443 $ 916,744 $861,518 $ 651,657 $678,882
Service revenue (2)........................................ 532,116 425,896 459,786 382,708 391,528
Operating income (loss).................................... 21,180 17,505 13,688 (5,230) 22,744
Income (loss) before income taxes, minority interests, and
extraordinary item.................................. 14,484 6,303 1,239 (12,877) 14,894
Income (loss) before minority interests and
extraordinary item.................................. 11,877 4,212 (1,661) (12,528) 8,639
Net income (loss) before extraordinary item................ 5,834 2,252 (1,661) (12,528) 8,639
Net income (loss).......................................... 5,834 2,252 (1,661) (18,497) 8,639
Net income (loss) available for common shareholders ....... 3,656 449 (3,815) (25,322) 3,346
Primary and Fully Diluted Net Income (Loss)
Per Common Share:
Before extraordinary item........................... $ 0.17 $ 0.02 $ (0.18) $ (0.92) $ 0.16
Extraordinary loss on early extinguishment of debt.. - - - (0.29) -
----------- ----------- -------- --------- --------
Total...................................... $ 0.17 $ 0.02 $ (0.18) $ (1.21) $ 0.16
=========== =========== ======== ========= ========
Weighted average common and common equivalent
shares outstanding, assuming full dilution.......... 22,062 21,517 20,957 20,886 21,272
Balance Sheet Data (end of period):
Total assets............................................... $ 365,973 $ 369,517 $281,422 $ 281,198 $293,076
Working capital............................................ 113,898 84,589 91,640 87,648 85,861
Long-term liabilities...................................... 161,951 125,818 133,130 130,752 75,602
Redeemable perferred stock................................. - 19,787 19,617 20,212 44,824
Shareholders' equity....................................... 34,892 28,427 27,624 30,780 58,521
</TABLE>
- ----------------------
(1) In fiscal year 1994, the Company adopted Statement of Financial Accounting
Standards No. 106, "Employers' Accounting for Postretirement Benefits Other
than Pensions."
(2) Service revenue is derived by deducting the costs of subcontracted services
and direct project costs from gross revenue and adding the Company's share
of the equity in income of unconsolidated joint ventures and affiliated
companies.
10
<PAGE>
USE OF PROCEEDS
The net proceeds to be received by the Company from the sale of the
105,000 shares of Common Stock offered hereby upon exercise of all of the
Warrants will equal $237,436.36. The Company intends to use all of the net
proceeds for general corporate purposes.
LEGAL MATTERS
Matters relating to the legality of the 105,000 shares of Common
Stock being offered by this Prospectus have been passed upon for the Company by
Paul Weeks, II, Esq., Senior Vice President, General Counsel, and Secretary of
the Company.
As of March 31, 1997, Mr. Weeks directly owned 28,675 shares of
Common Stock. In addition, as of December 31, 1996, Mr. Weeks owned 6,490 shares
of Common Stock which are held by the Company's Employee Stock Ownership Plan
("ESOP") and allocated to his ESOP account and another 3,353 shares which are
held in the Company's Retirement Plan and allocated to Mr. Weeks. As of March
31, 1997, Mr. Weeks had options to purchase 26,667 shares of Common Stock
(17,334 of which are exercisable during the 60-day period beginning March 31,
1997).
EXPERTS
The Consolidated Financial Statements of ICF Kaiser International,
Inc. and subsidiaries, which have been incorporated herein by reference to the
Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1996, have been incorporated by reference herein in reliance on the report of
Coopers & Lybrand L.L.P., independent accountants, given on the authority of
that firm as experts in accounting and auditing.
11
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
-------------------------------------------
The following table sets forth the expenses payable by the Registrant
with respect to the offering described in this Registration Statement, all of
which expenses, except for the Commission registration fee, are estimates:
<TABLE>
<S> <C>
SEC registration fee $ 63.64
Legal fees and expenses $1,000.00
Accounting fees and expenses $1,000.00
Miscellaneous expenses (EDGAR) $2,000.00
---------
Total $4,063.64
</TABLE>
Item 15. Indemnification of Directors and Officers
-----------------------------------------
Under the Delaware General Corporation Law ("Delaware Law"), a
corporation may indemnify any person who was or is a party or is threatened to
be made a party to an action by reason of the person's past or present service
as a director, officer, employee, or agent of the corporation or of the person's
past or present service, at the corporation's request, as a director, officer,
employee, or agent of another corporation, partnership, joint venture, trust, or
other enterprise. Under the Delaware Law, a corporation may indemnify such
persons against expenses (including attorneys' fees), judgments, fines, and
amounts paid in settlement that are actually and reasonably incurred by that
person in connection with such action. The Delaware Law provides, however, that
such person must have acted in good faith and in a manner that such person
reasonably believed to be in (or not opposed to) the corporation's best
interests. In respect of any criminal action or proceeding, an indemnifiable
person must have no reasonable cause to believe such conduct to be unlawful. In
addition, the Delaware Law permits no indemnification in any action by or in the
right of the corporation where such person has been adjudged liable to the
corporation, unless, and only to the extent that, a court determines that such
person fairly and reasonably is entitled to indemnity for such costs the court
deems proper in spite of liability adjudication.
The sections of the Company's Restated Certificate of Incorporation
and Amended and Restated By-laws relating to indemnification of directors and
officers provide for mandatory indemnification of directors and officers on
generally the same terms as permitted by the Delaware Law.
Item 16. Exhibits and Financial Statement Schedules
------------------------------------------
The following exhibits are included as part of this Registration
Statement .
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
Exhibit No. 5 Opinion and consent of Mr. Weeks
Exhibit No. 23(a) Consent of Coopers & Lybrand L.L.P.
Exhibit No. 23(b) Consent of Paul Weeks, II (contained in Exhibit No. 5)
Exhibit No. 24 Powers of Attorney (contained on the signature pages
of this Registration Statement)
</TABLE>
12
<PAGE>
Item 17. Undertakings
------------
The undersigned registrant hereby undertakes:
(a)(l) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include a prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or event 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. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
provided, however, that the undertakings set forth in paragraphs (a)(l)(i) and
- -------- -------
(a)(l)(ii) above 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 that are incorporated by reference in this registration
statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(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) 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
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 this 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.
(h) That insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers, and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer, or controlling
person of the Registrant in the successful defense of any action, suit, or
proceeding) is asserted by such 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.
13
<PAGE>
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-3 and has duly caused this Registration
Statement on Form S-3 to be signed on its behalf by the undersigned, thereunto
duly authorized, in the County of Fairfax, the Commonwealth of Virginia, on this
2nd of May, 1997.
ICF Kaiser International, Inc.
(Registrant)
Date: May 2, 1997 By /s/ James O. Edwards
------------------------------------
James O. Edwards,
Chairman and Chief Executive Officer
- --------------------------------------------------------------------------------
POWER OF ATTORNEY
Each of the undersigned hereby appoints James O. Edwards, Marc
Tipermas, Michael K. Goldman, Paul Weeks, II, and Cynthia L. Hathaway, and each
of them severally, his or her true and lawful attorneys to execute (in the name
of and on behalf of and as attorneys for the undersigned) this Registration
Statement on Form S-3 and any and all amendments to this Registration Statement
on Form S-3, and to file the same, with all exhibits thereto and other documents
in connection therewith, with the Securities and Exchange Commission.
- --------------------------------------------------------------------------------
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form S-3 has been signed below by the following
persons in the capacities and on the dates indicated.
(1) Principal executive officer
Date: May 2, 1997 By /s/ James O. Edwards
----------------------------------
James O. Edwards,
Chairman and Chief Executive Officer
(2) Principal financial and accounting officer
Date: May 2, 1997 By /s/ Michael K. Goldman
----------------------------------
Michael K. Goldman,
Executive Vice President,
Chief Administrative Officer,
and Acting Chief Financial Officer
14
<PAGE>
- --------------------------------------------------------------------------------
POWER OF ATTORNEY
Each of the undersigned hereby appoints James O. Edwards, Marc
Tipermas, Michael K. Goldman, Paul Weeks, II, and Cynthia L. Hathaway, and each
of them severally, his or her true and lawful attorneys to execute (in the name
of and on behalf of and as attorneys for the undersigned) this Registration
Statement on Form S-3 and any and all amendments to this Registration Statement
on Form S-3, and to file the same, with all exhibits thereto and other documents
in connection therewith, with the Securities and Exchange Commission.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
(3) The Board of Directors
<S> <C>
Date: May 2, 1997 By /s/ Kenneth L. Campbell
--------------------------------
Kenneth L. Campbell,
Director
Date: May 2, 1997 By /s/ Tony Coelho
--------------------------------
Tony Coelho,
Director
Date: May 2, 1997 By /s/ James O. Edwards
--------------------------------
James O. Edwards,
Director
Date: May 2, 1997 By /s/ Maynard H. Jackson
--------------------------------
Maynard H. Jackson,
Director
Date: May 2, 1997 By /s/ Thomas C. Jorling
--------------------------------
Thomas C. Jorling,
Director
Date: May 2, 1997 By /s/ Hazel R. O'Leary
--------------------------------
Hazel R. O'Leary,
Director
Date: May 2, 1997 By /s/ Keith M. Price
--------------------------------
Keith M. Price,
Director
Date: May 2, 1997 By /s/ Marc Tipermas
--------------------------------
Marc Tipermas,
Director
</TABLE>
15
<PAGE>
Exhibit No. 5
ICF Kaiser International, Inc.
9300 Lee Highway
Fairfax, VA 22031
May 5, 1997
ICF Kaiser International, Inc.
9300 Lee Highway
Fairfax, VA 22031
Re: ICF Kaiser International, Inc. Registration Statement on Form S-3
-----------------------------------------------------------------
Gentlemen:
Referring to the Registration Statement on Form S-3 which ICF Kaiser
International, Inc. (the "Company") has filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended (the "Securities Act"),
relating to the registration of 105,000 shares (the "Shares") of the Company's
Common Stock, par value $0.01 per share, I am of the opinion that:
1. The Shares have been duly and validly authorized by the Company.
2. The Shares to be issued upon exercise of the Company's Warrants
expiring December 31, 1999, at an exercise price of $2.30 per share will, when
issued and delivered, be legally issued, fully paid, and nonassessable.
Capitalized terms not otherwise defined herein are as defined in the
Registration Statement. I hereby consent to the filing of this opinion with the
Securities and Exchange Commission as Exhibit No. 5 to the Registration
Statement referred to above and to the use of my name under the heading "Legal
Matters."
Very truly yours,
/s/ Paul Weeks, II
---------------------
Paul Weeks, II
Senior Vice President,
General Counsel and Secretary
16
<PAGE>
Exhibit No. 23 (a)
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration
Statement of ICF Kaiser International, Inc. on Form S-3 of our report dated
February 28, 1997, on our audits of the consolidated financial statements and
the financial statement schedule of ICF Kaiser International, Inc. and
Subsidiaries as of December 31, 1996 and 1995, and for the year ended December
31, 1996, the ten months ended December 31, 1995, and the year ended February
28, 1995, which report is included in the Company's Annual Report on Form 10-K
for the year ended December 31, 1996. We also consent to the reference to our
firm under the caption "Experts."
Coopers & Lybrand L.L.P.
Washington, D.C.
May 5, 1997
17
