<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 12, 1997.
REGISTRATION NO. 333-21951
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
MFRI, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
<S> <C> <C>
DELAWARE 36-3922969
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
</TABLE>
7720 LEHIGH AVENUE
NILES, ILLINOIS 60714
(847) 966-1000
(Address, including ZIP code, and telephone number,
including area code, of registrant's principal executive
offices)
DAVID UNGER
CHAIRMAN OF THE BOARD OF DIRECTORS
MFRI, INC.
7720 LEHIGH AVENUE
NILES, ILLINOIS 60714
(847) 966-1000
(Name, address, including ZIP Code, and
telephone number, including area code, of agent for
service)
COPIES TO:
HAL M. BROWN, ESQ.
DORIAN R. WILLIAMS, ESQ.
RUDNICK & WOLFE
203 NORTH LASALLE STREET, SUITE 1800
CHICAGO, ILLINOIS 60601
(312) 368-4000
(312) 236-7516(TELECOPIER)
<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 AUGUST 12, 1997
PROSPECTUS
2,124,298 Shares
MFRI, INC.
COMMON STOCK
This Prospectus relates to 2,124,298 outstanding shares ("Shares") of
common stock, par value $.01 per share (the "Common Stock"), of MFRI, Inc.,
a Delaware corporation (the "Company"), which may hereafter be offered or
sold from time to time for the account of persons named under the caption
"Selling Stockholders."
The Shares were issued in the merger (the "Merger") of Midwesco, Inc.,
an Illinois corporation, with and into the Company, which occurred on
December 30, 1996 (the "Merger Closing Date").
The Shares may hereafter be offered or sold from time to time for the
account of persons named under the caption "Selling Stockholders" on the
Nasdaq National Market, or otherwise, at prices and on terms then
obtainable, in broker's transactions, special offerings, exchange
distributions, negotiated transactions, block transactions, or otherwise.
See "Selling Stockholders" and "Plan of Distribution." The Company will
not realize any proceeds from any sale of the Shares.
SEE "RISK FACTORS" ON PAGE 2 FOR A DISCUSSION OF CERTAIN FACTORS THAT
SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON STOCK OFFERED
HEREBY.
The Common Stock is traded on the Nasdaq National Market under the
symbol MFRI. On July 31, 1997, the last reported sale price of the Common
Stock on the Nasdaq National Market was $9-3/8.
______________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION PASSED OR ANY STATE SECURITIES COMMISSION UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
______________
AUGUST 12, 1997
<PAGE>
NO DEALER, BROKER OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN
THIS PROSPECTUS, IN CONNECTION WITH THE OFFERING MADE HEREBY, AND, IF GIVEN
OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED ON AS HAVING
BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN
OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY THE SECURITIES TO WHICH
IT RELATES IN ANY JURISDICTION IN WHICH, OR TO ANY PERSON TO WHOM, IT IS
UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION OF AN OFFER. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY OFFER OR SALE MADE HEREUNDER SHALL,
UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE INFORMATION SET FORTH HEREIN OR IN THE AFFAIRS OF THE COMPANY
SINCE THE DATE HEREOF.
THIS PROSPECTUS, INCLUDING DOCUMENTS INCORPORATED BY REFERENCE,
CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 27A OF
THE SECURITIES ACT AND SECTION 21E OF THE EXCHANGE ACT. FORWARD-LOOKING
STATEMENTS ARE INHERENTLY SUBJECT TO RISKS AND UNCERTAINTIES, MANY OF WHICH
CANNOT BE PREDICTED WITH ACCURACY AND SOME OF WHICH MIGHT NOT EVEN BE
ANTICIPATED. FUTURE EVENTS AND ACTUAL RESULTS, FINANCIAL AND OTHERWISE,
MAY DIFFER MATERIALLY FROM THE RESULTS DISCUSSED IN THE FORWARD-LOOKING
STATEMENTS. FACTORS THAT MIGHT CAUSE SUCH A DIFFERENCE INCLUDE, BUT ARE
NOT LIMITED TO, THOSE DISCUSSED IN "RISK FACTORS" HEREIN AND IN
"MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION" INCORPORATED BY REFERENCE IN THE COMPANY'S ANNUAL
REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED JANUARY 31, 1997, WHICH IS
INCORPORATED BY REFERENCE IN THIS PROSPECTUS.
TABLE OF CONTENTS
PAGE
Available Information 2
Risk Factors 2
The Company 3
Selling Stockholders 5
Use of Proceeds 8
Plan of Distribution 8
Legal Matters 9
Experts 9
Information Incorporated by Reference 9
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 periodic 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 maintained by the Commission at
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and should also
be available for inspection and copying at the regional offices of the
Commission located at 75 Park Place, 14th Floor, New York, New York 10007
and 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies
of such material can also be obtained from the Public Reference Section of
the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at
prescribed rates. The Commission maintains a Web site that contains
reports, proxy and information statements, and other information about the
Company. The address of the Web site maintained by the Commission is
"http://www.sec.gov".
This Prospectus constitutes a part of a registration statement on
Form S-3 (herein, together with all amendments and exhibits, the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Securities Act"), filed by the Company. This Prospectus does not contain
all of the information set forth in the Registration Statement. For
further information, reference is hereby made to the Registration
Statement, including the financial schedules and exhibits filed or
incorporated by reference as a part thereof, which may be -examined at the
Public Reference Room of the Commission in Washington, D.C., without
charge, or copies of which may be obtained from the Commission upon payment
of the prescribed fees. Statements contained herein concerning the
provisions of documents filed herewith as exhibits are necessarily
summaries of such documents, and each such statement is qualified in its
entirety by reference to the copy of the applicable document filed with the
Commission.
RISK FACTORS
COMPETITION; BUSINESS. The businesses in which the Company is engaged
are highly competitive. In addition, new installations of baghouses are
subject to competition from alternative technologies and the sale of
specialty piping systems and electronic leak detection and location systems
are subject to competition from alternative products. The business of
Thermal Care is dependent on the plastics industry. Any adverse trends in
the plastics industry may have a material adverse effect on the business of
Thermal Care. Thermal Care relies upon a single source for key components
of several of its products. Although the Company believes that there are
alternate sources available for such components, there can be no assurance
that the interruption of supplies of such components would not have an
adverse effect on the financial condition of the Company, and that the
Company, if required to do so, would be able to negotiate agreements with
alternative sources on acceptable terms.
GOVERNMENT REGULATION. The demand for the Company's leak detection
and location systems and secondary containment piping systems is driven
primarily by government regulation with respect to hazardous waste. Laws
such as the Federal Resource Conservation and Recovery Act ("RCRA"), and
standards such as the National Emission Standard for Hydrocarbon Airborne
Particulates ("NESHAP"), have increased the demand for the Company's leak
detection and location and secondary containment piping systems. The
Company's filtration products business to a large extent is dependent on
governmental regulation of air pollution at the federal and state levels.
The Company believes that continuing growth in the sale of filtration
products and services will be materially dependent on continuing
enforcement of environmental laws such as the Federal Clean Air Act
Amendments of 1990 ("Clean Air Act Amendments"). Although changes in such
environmental regulations could significantly alter the demand for the
Company's products and services, the Company does not believe that such a
change is likely to decrease demand in the foreseeable future.
ECONOMIC FACTORS. Although demand for many of the Company's products
is generally affected by its customers' need to comply with governmental
regulations, purchases of the Company's products at times may be delayed by
customers due to adverse economic factors.
DIVIDENDS. The Company has not paid dividends in the past and does
not anticipate paying cash dividends on its common stock in the foreseeable
future. The Company's line of credit agreement contains certain
restrictions on payment of dividends. The primary restriction limits
dividends to a cumulative amount of up to 25% of net income.
LACK OF ARM'S-LENGTH NEGOTIATIONS; CONFLICTS OF INTEREST. The
agreements between the Company and Midwesco relating to the Merger and the
Perma-Pipe Transaction were not negotiated on an arm's-length basis.
However, the Company believes the consideration, representations,
warranties and covenants in such agreements are fair to the Company even
though they may not provide the same level of protection as similar
representations, warranties and covenants contained in comparable
agreements with persons that are not affiliates of the Company. Members of
the Board of Directors affiliated with Midwesco (Messrs. Unger, Ogilvie,
Elgendy, Gruenberg and Henry and Bradley Mautner) will have a conflict of
interest with respect to their obligations as directors and officers of the
Company, and enforcing the terms of such agreements against Midwesco, if
necessary.
THE COMPANY
The Company is engaged in the manufacture and sale of filter bags for
use in industrial air pollution control systems known as "baghouses", and
also engineers, designs and manufactures specialty piping systems and leak
detection and location systems, and industrial water cooling equipment.
The Company, which was incorporated in Delaware in October 1993, is the
successor corporation to Midwesco Filter Resources, Inc. ("Midwesco
Filter").
Midwesco Filter was incorporated in Delaware in October 1989 as a
wholly owned subsidiary of Midwesco. On December 13, 1989, Midwesco Filter
exchanged shares of its common stock for the net assets constituting its
Midwesco Filter Resources division ("Filter Division") of Midwesco. The
Filter Division was formed from certain assets of the Filter Media division
of the Kennecott Corporation, acquired by Midwesco in June 1982, and
certain assets of the Filter Resources Corporation, acquired by Midwesco in
December 1983.
On January 28, 1994 pursuant to a merger transaction ("Perma-Pipe
Transaction") between the Company, a subsidiary of the Company and Midwesco
Filter, the Company acquired the Perma-Pipe business ("Perma-Pipe") from
Midwesco for cash and 278,666 shares of Common Stock. Pursuant to the
Perma-Pipe Transaction, each share of common stock of Midwesco Filter was
exchanged for one share of Common Stock. Immediately prior to the
effective time of the Perma-Pipe Transaction, a public offering (the
"Offering") of shares of common stock of Midwesco Filter was consummated,
the net proceeds of which were used to repay bank debt related to
Perma-Pipe. Perma-Pipe is in the business of engineering, designing and
manufacturing specialty piping systems and leak detection and location
systems.
On September 30, 1994, the Company and an indirect wholly-owned
subsidiary of the Company, pursuant to a purchase agreement dated as of
such date ("Purchase Agreement"), acquired substantially all of the assets
of Ricwil Piping Systems Limited Partnership ("Ricwil LP") for cash and
55,710 shares of Common Stock, as adjusted in accordance with the terms of
the Purchase Agreement. Ricwil LP was a manufacturer of insulated piping
systems for district heating and cooling systems.
On December 6, 1995, Perma-Pipe acquired for cash the net assets and
leak detection business of Hagenuk GmbH.
On August 15, 1996, the Company, pursuant to an Asset Purchase
Agreement dated as of such date (the "Purchase Agreement"), acquired
substantially all of the assets of Eurotech Air Filtration, Inc., an Oregon
corporation ("Eurotech"), for cash and 30,571 shares of Common Stock.
Pursuant to the Purchase Agreement, Eurotech distributed such shares to its
four shareholders.
On December 30, 1996, the Company acquired the Thermal Care Division
("Thermal Care") and certain other specified assets and liabilities of
Midwesco by the merger of Midwesco with and into MFRI (the "Merger").
Through the Merger, an aggregate of 2,124,298 shares of Common Stock were
issued to the shareholders of Midwesco and the 1,717,666 shares of Common
Stock owned by Midwesco immediately prior to the consummation of the Merger
were cancelled. Thermal Care engineers, designs and manufactures
industrial water cooling equipment.
The Company's filtration products business is carried on by Midwesco
Filter, and the piping system products business is carried on by Perma-
Pipe, Inc. Midwesco Filter and Perma-Pipe, Inc. are wholly-owned
subsidiaries of MFRI. As used herein, unless the context otherwise
requires, the term Company includes MFRI, Inc., Midwesco Filter, Thermal
Care, Perma-Pipe, Inc., and its subsidiaries, and their predecessors.
The Company's principal executive offices are located at 7720 Lehigh
Avenue, Niles, Illinois 60714 and its telephone number is (847) 966-1000.
Other information concerning the Company's management, business,
securities, and results of operations is incorporated by reference from its
reports filed with the Commission. See "Information Incorporated by
Reference."
SELLING STOCKHOLDERS
The Shares may be offered from time to time for the account of the
Selling Stockholders whose names are set forth in the table below. The
table sets forth information as of January 31, 1997 with respect to the
beneficial ownership of the Shares by the Selling Stockholders. To the
knowledge of the Company, none of the Selling Stockholders has any material
relationship with the Company except as set forth in the footnotes to the
following table and as more fully described elsewhere in this Prospectus
(including the information incorporated by reference in this Prospectus).
<TABLE>
<CAPTION>
SELLING STOCKHOLDER NO. OF SHARES OWNED NO. OF SHARES WHICH NO. OF SHARES WHICH MAY
PRIOR TO Offering(1) MAY BE Offered BE OWNED AFTER
Offering(1)
<S> <C> <C> <C>
Henry Mautner(2) 451,688 419,938 31,750
Debra Mautner 170,473 170,473 --
David M. Mautner(3) 171,298 170,473 825
Bradley E. Mautner(4) 172,773 170,473 2,300
David Unger(5) 535,677 489,927 45,750
Maxine S. Unger(6) 29,359 12,859 16,500
Judith Golden 141,632 141,632 --
Rebecca Fishman 148,932 141,632 7,300
Michael Unger 142,132 141,632 500
Robert F. Spreenberg(7) 187,925 187,925 --
David A. Miller(8) 6,611 5,511 1,100
William F. Davis(9) 27,126 25,901 1,225
Judith & Jeff Golden 4,374 3,674 700
Don L. Gruenberg(10) 4,587 1,837 2,750
John F. Conroy(11) 2,543 918 1,625
Carlo Ferraro(12) 367 367 --
Edward A. Crylen(13) 3,062 1,837 1,225
Herbert J. Sturm(14) 9,815 3,490 6,325
Robert F. Spreenberg(15) 9,552 9,552 --
Gene K. Ogilvie(16) 43,772 11,022 32,750
Michael D. Bennett(17) 10,331 3,306 7,025
Fati Elgendy(18) 27,969 9,919 18,050
</TABLE>
<PAGE>
(1) Includes shares, if any, held by spouse; held as custodian; held in
joint tenancy with spouse; held by or for the benefit of the named
person or one or more members of his immediate family; with respect to
which the named person has or shares voting or investment powers; or
in which the named person otherwise has a beneficial interest. Also
includes shares issuable upon exercise of employee stock options.
(2) Henry Mautner is Director and Vice Chairman of the Board of Directors
of the Company. From 1972 to the Merger Closing Date, he served as
Chairman of Midwesco.
(3) From June 1985 to the Merger Closing Date, David M. Mautner served as
Director of Midwesco.
(4) Bradley E. Mautner is Director and Vice President of the Company.
From January 1994 to the Merger Closing Date, he served as President
of Midwesco. In addition, since February 1996, he served as the Chief
Executive Officer of Midwesco Services, Inc. ("Midwesco Services"),
which, prior to the Merger Closing Date, was a 50% owned affiliate of
Midwesco. Mr. Mautner served as President of Midwesco Services from
February 1988 to January 1996.
(5) David Unger is Director, Chairman of the Board of Directors, President
and Chief Executive Officer of the Company. From 1972 to the Merger
Closing Date, he served as Director of Midwesco, having served as
President from 1972 to January 1994 and Vice President since January
1994.
(6) From March 1993 to the Merger Closing Date, Maxine S. Unger served as
Director of Midwesco.
(7) From February 1970 to the Merger Closing Date, Robert F. Spreenberg
served as Director and Executive Vice President of Midwesco.
(8) From June 1979 to the Merger Closing Date, Mr. Miller served as Vice
President of Midwesco.
(9) From June 1979 to the Merger Closing Date, Mr. Davis served as Vice
President of Midwesco.
(10) Mr. Gruenberg is Director and Vice President of the Company. From
August 1980 to the Merger Closing Date, he served as Vice President of
Midwesco.
(11) Mr. Conroy is Controller and Assistant Secretary of the Company. From
January 1980 to the Merger Closing Date, he served as Controller of
Midwesco.
(12) From May 1982 to the Merger Closing Date, Mr. Ferraro served as Vice
President of Midwesco Services.
(13) From August 1982 to the Merger Closing Date, Mr. Crylen served as Vice
President of Midwesco.
(14) Mr. Sturm is Vice President of the Company and of Midwesco Filter.
(15) From May 1979 to the Merger Closing Date, Robert F. Spreenberg was
employed by Midwesco.
(16) Mr. Ogilvie is Director, Vice President of the Company and President
of Midwesco Filter. From 1982 to the Merger Closing Date, he served
as Vice President of Midwesco.
(17) Mr. Bennett is Vice President, Secretary and Treasurer of the Company.
From 1989 to the Merger Closing Date, he served as Vice President,
Secretary and Treasurer of Midwesco.
(18) Mr. Elgendy is Director, Vice President of the Company and President
of Perma-Pipe, Inc.
At June 30, 1997, there were 4,969,229 shares of Common Stock
outstanding.
USE OF PROCEEDS
This Prospectus relates solely to Shares being offered and sold
for the accounts of the Selling Stockholders. The Company will not
realize any proceeds from any sale of Shares by the Selling
Stockholders.
PLAN OF DISTRIBUTION
The Selling Stockholders may offer and sell Shares by means of
the Prospectus from time to time in one or more transactions,
directly by the Selling Stockholders, or through agents, dealers or
brokers to be designated from time to time; such offers and sales may
be effected over any national securities exchange or automated
interdealer quotation system on which shares of the Common Stock are
then listed, in negotiated transactions or in a combination of such
methods of sale; the selling price of the Shares may be at market
prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices; and the Shares may
also be offered in coordinated block transactions through
underwriters, dealers or agents, or otherwise who may receive
compensation in the form of underwriting or brokerage discounts,
concessions or commissions from the Selling Stockholders or the
purchasers of such Shares for whom they may act as agents. In
certain states, the Selling Stockholders may be required to offer and
sell Shares only through brokers and dealers registered in such
states.
The Selling Stockholders and any brokers or dealers that act in
connection with the sale of Shares hereunder may be deemed to be
"underwriters" within the meaning of Section 2(11) of the Securities
Act and any commissions received by them and any profit on the sale
of Shares as principal may be deemed to be underwriting discounts and
commissions under the Securities Act.
The Company will pay all of the expenses of the preparation,
printing and filing of the Registration Statement, any amendments or
supplements thereto, and prospectuses and revised prospectuses as
required to cover the transactions covered hereby, as well as the
Company's fees and disbursements of its counsel and accountants
relating to the Registration Statement, but the Company is not
obligated to pay any underwriting discounts and commissions, brokers'
commissions or charges, the legal fees and expenses of the Selling
Stockholders, or transfer taxes, if any, relating to the sale or
disposition of Shares by a Selling Shareholder.
The Selling Stockholders may also resell Shares in open market
transactions pursuant to the resale provisions of Rule 144 under the
Securities Act or in transactions otherwise permitted under the
Securities Act.
LEGAL MATTERS
Certain legal matters in connection with the Shares, including
the validity of the Shares, will be passed upon for the Company by
Rudnick & Wolfe, Chicago, Illinois.
EXPERTS
The Consolidated Financial Statements of MFRI, Inc. and
subsidiaries incorporated in this Prospectus by reference from the
Company's Annual Report on Form 10-K for the year ended January 31,
1997 and the Consolidated Financial Statements of Midwesco, Inc. and
subsidiaries incorporated in this Prospectus by reference from the
Company's Current Report on Form 8-K dated August 11, 1997 have been
audited by Deloitte & Touche LLP, independent auditors, as stated in
their reports, which are incorporated herein by reference, and have
been so incorporated in reliance upon the reports of such firm given
upon their authority as experts in accounting and auditing.
INFORMATION INCORPORATED BY REFERENCE
The following documents previously filed by the Company with the
Commission pursuant to the Exchange Act (SEC File No. 1-18370) are
hereby incorporated by reference into this Prospectus:
(i) the registration statement of the Company's
predecessor on Form 8-A filed on March 13, 1990
registering common stock of the Company's predecessor
under Section 12(g) of the Securities Exchange Act of
1934;
(ii) the Company's Annual Report on Form 10-K for the
fiscal year ended January 31, 1997;
(iii) the Company's Quarterly Report on Form 10-Q for the
quarter ended April 30, 1997; and
(iv) the Company's Current Report on Form 8-K dated
August 11, 1997.
All documents filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act after the date of this
Prospectus and before the termination of the offering of shares of
the Common Stock made hereby are hereby incorporated by reference,
and such documents are deemed to be a part hereof from the date of
filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall
be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently
filed document which is or is deemed to be incorporated by reference
herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not, except as so modified or
superseded, constitute a part of this Prospectus.
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON,
INCLUDING ANY BENEFICIAL OWNER OF COMMON STOCK, TO WHOM A COPY OF
THIS PROSPECTUS IS DELIVERED, UPON THE ORAL OR WRITTEN REQUEST OF
SUCH PERSON, A COPY OF ANY AND ALL OF THE INFORMATION THAT HAS BEEN
INCORPORATED BY REFERENCE IN THIS PROSPECTUS (NOT INCLUDING EXHIBITS
TO THE INFORMATION THAT IS INCORPORATED BY REFERENCE UNLESS SUCH
EXHIBITS ARE SPECIFICALLY INCORPORATED BY REFERENCE IN SUCH
INFORMATION). SUCH REQUEST SHOULD BE DIRECTED TO MICHAEL D. BENNETT,
SECRETARY, MFRI, INC., 7720 LEHIGH AVENUE, NILES, ILLINOIS 60714
(TELEPHONE (847) 966-1000).
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 16. EXHIBITS.
EXHIBIT EXHIBIT
NUMBER DESCRIPTION
2.1 Agreement for Merger by and between Midwesco, Inc. and
MFRI, Inc. [Incorporated by reference to Appendix A
to the Company's Proxy Statement dated November 12,
1996 relating to the Company's Special Meeting of
Stockholders held on December 16, 1996 (SEC File
No. 0-18370)].
2.2 Agreement and Plan of Merger by and between Midwesco,
Inc. and MFRI, Inc. [Incorporated by reference to
Exhibit 2.2 to the Company's Current Report on
Form 8-K dated December 30, 1996 (SEC File
No. 0-18370)].
5 Opinion of Rudnick & Wolfe with respect to the
legality of the Common Stock being registered.*
23.1 Consent of Deloitte & Touche LLP.
23.2 Consent of Rudnick & Wolfe (contained in Exhibit 5
hereof).*
24.1 Power of Attorney of Directors and certain officers of
the Company.*
24.2 Power of Attorney of certain Directors of the
Company.*
* Previously filed.
<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 amendment to registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of
Niles, State of Illinois, on August 12, 1997.
MFRI, INC.
By:/S/ DAVID UNGER
David Unger
Chairman of the Board and
Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
amendment to registration statement has been signed below by the
following persons in the capacities and on the date indicated.
SIGNATURE TITLE DATE
David Unger* Director and Chairman of the
Board of Directors (Principal
Executive Officer) August 12, 1997
Henry M. Mautner* Director, Vice Chairman of
the Board of Directors August 12, 1997
Gene K. Ogilvie* Director and Vice President August 12, 1997
Bradley E. Mautner* Director and Vice President August 12, 1997
Michael D. Bennett* Vice President, Secretary and
Treasurer (Principal Financial
and Accounting Officer) August 12, 1997
Fati Elgendy* Director and Vice PresidentAugust 12, 1997
Don Gruenberg* Director and Vice President August 12, 1997
Arnold F. Brookstone* Director August 12, 1997
Eugene Miller* Director August 12, 1997
Stephen B. Schwartz* Director August 12, 1997
*By:/S/ DAVID UNGER Individually and as Attorney- August 12, 1997
David Unger in-fact
<PAGE>
EXHIBIT INDEX
EXHIBIT EXHIBIT
NUMBER DESCRIPTION
2.1 Agreement for Merger by and between Midwesco, Inc. and
MFRI, Inc. [Incorporated by reference to Appendix A to the
Company's Proxy Statement dated November 12, 1996 relating
to the Company's Special Meeting of Stockholders held on
December 16, 1996 (SEC File No. 0-18370)].
2.2 Agreement and Plan of Merger by and between Midwesco, Inc.
and MFRI, Inc. [Incorporated by reference to Exhibit 2.2
to the Company's Current Report on Form 8-K dated
December 30, 1996 (SEC file No. 0-18370)].
5 Opinion of Rudnick & Wolfe with respect to the legality of
the Common Stock being registered.*
23.1 Consent of Deloitte & Touche LLP.
23.2 Consent of Rudnick & Wolfe (contained in Exhibit 5
hereof).*
24.1 Power of Attorney of the Directors and certain officers of
the Company.*
24.2 Power of Attorney of certain Directors of the Company.*
* Previously filed.
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration
Statement of MFRI, Inc. on Form S-3 of our report dated April 18,
1997 with respect to the Consolidated Financial Statements of MFRI,
Inc. and subsidiaries appearing in the Annual Report on Form 10-K of
MFRI, Inc. for the year ended January 31, 1997, and of our report
dated May 28, 1996 (August 14, 1996 as to the second paragraph of
Note 6) with respect to the Consolidated Financial Statements of
Midwesco, Inc. and subsidiaries appearing in the Current Report on
Form 8-K of MFRI, Inc. dated August 11, 1997, and to the reference to
us under the caption "Experts" in the Prospectus, which is part of
this Registration Statement.
/S/ DELOITTE & TOUCHE LLP
Deloitte & Touche LLP
Chicago, Illinois
August 12, 1997
