As filed with the Securities and Exchange Commission on August 24, 2006.
Registration No. 333-131085
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 3 to
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
ADA-ES, Inc.
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(Exact name of registrant as specified in its charter)
Colorado 84-1457385
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(State of incorporation) (IRS Employer Identification No.)
8100 SouthPark Way, Unit B,
Littleton, Colorado 80120
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(Address of principal executive offices, including Zip Code)
(Registrant's telephone number, including area code): (303) 734-1727
Mark H. McKinnies
8100 SouthPark Way, B, Littleton Colorado 80120
(303) 734-1727
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(Name, address, including zip code and telephone number,
including area code, of agent for service of process)
With a copy to:
Julie A. Herzog, Esq.
SCHUCHAT, HERZOG & BRENMAN, LLC
1900 Wazee Street, Suite 300
Denver, CO 80202
(303) 295-9700
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to
time after this Registration Statement becomes effective.
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. [ ]
CALCULATION OF REGISTRATION FEE
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Proposed
Title of each class Proposed maximum
of securities to be Amount to be maximum offering aggregate offering Amount of
registered registered price per share price registration fee
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Common Stock, no
par value:
For sale by selling
shareholders 789,089 Shares $ 22.485 (*) $ 17,742,666 (*) $ 1,898.47
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(*) Based on the average of the high and low sale prices reported for the Common
Stock on the NASDAQ Capital Market on January 13, 2006. The resulting fee is
calculated pursuant to section (c) of Rule 457 of Regulation C, and has been
previously paid.
2
The information in this prospectus is not complete and may be changed. These
securities may not be sold until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted
Subject to completion, Dated August 24, 2006
ADA-ES, INC.
789,089 SHARES OF COMMON STOCK
This Prospectus relates to 789,089 shares of our Common Stock being offered for
resale by certain selling shareholders.
The selling shareholders may offer their Common Stock through or to securities
brokers or dealers designated by them on the NASDAQ Capital Market or in other
transactions negotiated by the selling shareholders. The selling shareholders
may sell the shares at whatever prices are current when particular sales take
place or at other prices to which the selling shareholders agree. The selling
shareholders will pay any brokerage fees or commissions relating to the sale of
shares. The registration of the selling shareholders' shares does not
necessarily mean that any shares will be sold.
We will receive no amounts from the sales of any of the shares subject to this
registration statement. We are paying the costs of preparing and filing the
registration statement of which this Prospectus is a part.
The acquisition and ownership of our Common Stock involve a high degree of risk.
Only investors who are able to afford the risk of loss of their entire
investment should purchase our Common Stock. See "Risk Factors" beginning on
page 2 of this Prospectus.
Our Common Stock is traded on the NASDAQ Capital Market under the symbol "ADES".
On January 19, 2006, the last quoted sales price of the Common Stock on that
market was $23.28 per share.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED ON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The mailing address and telephone number of our principal executive office are
8100 SouthPark Way, Unit B, Littleton, Colorado 80120 and (303) 734-1727.
This Prospectus is dated _____________, 2006.
TABLE OF CONTENTS
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COVER PAGE 1
RISK FACTORS 2
RISKS RELATING TO OUR BUSINESS 2
RISKS RELATING TO OUR COMMON STOCK 5
FORWARD LOOKING STATEMENTS 6
WHERE YOU CAN FIND MORE INFORMATION 6
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE 7
USE OF PROCEEDS 7
SELLING SHAREHOLDERS 8
PLAN OF DISTRIBUTION 10
TRANSFER AGENT 12
LEGAL MATTERS 12
EXPERTS 12
In this Prospectus, "the Company," "we," "us," or "our" refers to ADA-ES, Inc.,
a Colorado corporation, and its consolidated subsidiary. You should rely only on
the information incorporated by reference or provided in this Prospectus or any
prospectus supplement. Neither the selling shareholders nor we have authorized
anyone else to provide you with different information. The selling shareholders
are not making an offer of these securities in any state where the offer is not
permitted. You should not assume that the information in this Prospectus or any
prospectus supplement is accurate as of any date other than the date on the
front of those documents.
RISK FACTORS
An investment in our Common Stock involves a high degree of risk. You should
carefully consider the risks described below and the other information in this
Prospectus and any other filings we may make with the Securities and Exchange
Commission in the future before investing in our Common Stock. If any of the
following risks occur, our business, operating results and financial condition
could be seriously harmed. The trading price of our Common Stock could decline
due to any of these risks, and you may lose all or part of your investment. An
investment in our Common Stock may involve additional risks and uncertainties
not described below.
RISKS RELATING TO OUR BUSINESS
IF EXISTING AND PLANNED ENVIRONMENTAL LAWS ARE RESCINDED OR SUBSTANTIALLY
CHANGED, OUR BUSINESS WOULD BE ADVERSELY AFFECTED A significant market driver
for our existing products and services, and those planned in the future, are the
environmental laws that limit emissions from power plants. In the event that
such laws were rescinded or substantially changed, our business would be
adversely affected by declining demand for such products and services. Demand
for the Company's FGC and ADA 249 products is primarily two-fold. Customers
purchase these products to mitigate operating problems and/or to help comply
with environmental regulations such as the Clean Air Act Amendments of 1990.
2
Although our existing customers and those expected in the near-term are believed
to desire our products for mitigation of operating problems, we would anticipate
that any softening of existing air pollution control requirements would slow
expected growth for these products.
Demand for our mercury emission control ("MEC") technology is being driven
almost exclusively by legislation requiring such control. Mercury has been
identified as a toxic substance and pursuant to a court order the EPA issued the
Clean Air Mercury Regulations ("CAMR") for its control in March 2005. CAMR is
being contested by as many as fourteen different states and four environmental
groups for its failure to meet court-mandated standards. In response to the
uncertainty surrounding CAMR, several states have passed, or are expected to
pass, legislation requiring such control including Connecticut, New Hampshire,
New Jersey, Massachusetts, North Carolina, Wisconsin and Pennsylvania.
Following widespread disappointment and legal challenges of the CAMR, in
November 2005 the State and Territorial Air Pollution Program Administrators and
the Association of Local Air Pollution Control Officials (STAPPA/ALAPCO) - the
two national associations of air pollution control agencies throughout the
United States, have developed a model rule entitled, "Mercury from Power Plants:
A Model Rule for States and Localities" in response to concern that EPA's CAMR
was inconsistent with the requirements of the Clean Air Act and would not result
in adequate reductions in emissions of mercury from coal-fired power plants to
protect public health. The STAPPA/ALAPCO model rule provides state and local
governments with the tools needed to obtain reductions in mercury emissions
necessary to meet the requirements of the Clean Air Act. Specifically, the model
describes two options for state and local governments that wish to develop
utility mercury rules that are more protective of public health and the
environment than EPA's regulation and contains model rule language for both. The
phased timing proposed in the model rule allows power generators to consider
mercury specific control technologies, or alternatively, control technologies
that reduce mercury as an added benefit when reducing other air pollution
emissions. The model rule provides compliance options using two phases, the use
of annual rolling averages, and averaging of emissions across sources at a
facility; and may well provide the flexibility to prevent any threat to a
source's ability to continue to generate power. As compared with either maximum
achievable control technology (MACT) regulation, or CAMR, we believe the
STAPPA/ALAPCO model rule better reflects the capabilities of mercury control
technologies that are currently commercially available today and gives power
generators options in selecting the most cost effective approach for each plant.
The impact of various state and federal regulations on the future of our
business, and the long-term growth of the MEC market for the electric utility
industry will most likely depend on the final outcome of the CAMR court action
and how industry chooses to respond to a final CAMR and other state regulations,
which are in various stages of enactment. As many as 1,100 existing coal-fired
boilers may be affected by such regulations, when they are fully implemented.
Permitting of new coal-fired plants generally requires them to meet more
stringent requirements that likely include MEC. For the near-term, our revenues
from this market will depend on (i) DOE- and industry-funded contracts, (ii)
mercury testing services and (iii) equipment sales and commissions on sorbents
sold to new plants and existing plants affected by the implementation of enacted
regulations. We do not expect significant revenue growth unless and until
federal regulations and/or state regulations impact a significant portion of
existing boilers. Delays in, or derailment of, the passage of state mercury
control legislation or undue delay in resolution of the CAMR court action will
likely impede the expected growth of the Company.
IF THE DEPARTMENT OF ENERGY (DOE) DISCONTINUES FUNDING OF EXISTING AND PLANNED
CLEAN COAL TECHNOLOGY PROGRAMS, OUR BUSINESS WOULD BE HARMED.
In 2005, 2004 and 2003, 39%, 49% and 45%, respectively of our revenues were
derived from or related to DOE programs. Our revenues from government contracts
would be adversely impacted by any material decrease in funding for the projects
in which we are involved. In addition, we look to the DOE funding as a
significant means to further develop our technology and intellectual property in
the areas of mercury emissions control and flue gas conditioning additives
covered by that funding. Any material decrease in funding for the projects in
which we are involved would hamper the development of our technology and
intellectual property as it does not appear that we could currently fund the
same level of development work apart from the DOE.
3
THE LOSS OF KEY RELATIONSHIPS WOULD ADVERSELY AFFECT OUR SALES AND FINANCIAL
CONDITION
We have developed key industry relationships with companies much larger than
ourselves (e.g., NORIT Americas, Inc., Alstom Power, Inc, and Arch Coal, Inc.).
Subject to the terms of those agreements, the relationships may be terminated by
the passage of time, through notification from the other party or failure of the
Company to obtain a certain market share of activated carbon sales. We believe
these relationships bolster our position in the market to limit mercury
emissions from coal-fueled power plants. The loss of these relationships would
impede our ability to secure business from that market.
TECHNICAL OR OPERATIONAL PROBLEMS WITH THE ACTIVATED CARBON INJECTION SYSTEMS
COULD RESULT IN DELAYS THAT ADVERSELY AFFECT OUR FINANCIAL CONDITION
Our activated carbon injection (ACI) systems have been demonstrated for several
months at certain power plants and are starting to be installed on a permanent
basis for the first time. There can be no assurance that there will be no
technical or operational problems with our ACI systems. Any such problems could
result in delays in, or postponement or cancellation of, expected installations
at power plants.
EFFECT OF ISSUING PERFORMANCE GUARANTEES FOR COMMERCIAL ACTIVATED CARBON
INJECTION SYSTEMS IS UNKNOWN AND COULD ADVERSELY AFFECT OUR FINANCIAL CONDITION
The market for commercial ACI systems to control mercury emissions is emerging
as state and federal regulations are being formalized. Performance guarantees
have been and will likely continue to be an integral part of successful sales.
Such guarantees typically require levels of mercury removal efficiency based on
stated injection rates of a specified or approved activated carbon given other
operating parameters, including the nature of the coal burned. Provisions of
such guarantees generally require us to spend amounts up to the value of the
sales contract to "make right" the performance of the ACI, if the guaranteed
level of performance is not achieved. Any substantial payments under such
guarantees would have an adverse effect on our financial condition and our
ability to generate future sales.
ANY DECREASE IN THE USE OF COAL BY ELECTRIC UTILITY COMPANIES COULD ADVERSELY
AFFECT OUR FINANCIAL CONDITION AND BUSINESS
Our business depends substantially on providing air pollution and operating cost
solutions to coal-fueled power plants. If the demand for coal declines as a
result of increases in the use of alternative fuels, technological developments
or general economic conditions, our financial condition and business could be
materially adversely affected.
OUR FINANCIAL RESULTS MAY FLUCTUATE AS A RESULT OF SEASONALITY AND OTHER
FACTORS, INCLUDING THE DEMAND FOR ENVIRONMENTAL TECHNOLOGY AND SPECIALTY
CHEMICALS, WHICH MAKES IT DIFFICULT TO PREDICT OUR FUTURE PERFORMANCE
The environmental technology and specialty chemicals industry is generally
subject to seasonal trends. These trends reflect the general pattern of
electricity use and generation, which typically peak during the spring and
summer months and decline from October through March. Our quarterly results can
be expected to fluctuate in the future, reflecting this seasonality. These and
other factors may make it difficult to predict our results of operations. If our
results of operations do not meet the expectations of our shareholders and
financial analysts, then our Common Stock price may be adversely impacted.
INADEQUATE SUPPLIES OF ACTIVATED CARBON COULD ADVERSELY AFFECT OUR
PROFITABILITY.
We expect the demand for activated carbon to increase as power plants begin to
use ACI systems to control mercury emissions. If the production of activated
carbon, which is outside our control, does not increase to meet the increased
demand, the inadequate supplies of activated carbon could harm our results of
operations and business.
INADEQUATE SUPPLIES OF COAL COULD ADVERSELY AFFECT OUR PROFITABILITY.
Our profitability depends on working with coal-fueled power plants. If
economically recoverable coal reserves are not available or if coal cannot be
readily supplied to power plants because of transportation, labor or other
issues, such unavailability could adversely affect our profitability and impede
the growth of our business.
4
LACK OF CLARIFICATION OF "MARKET VALUE" BY CONGRESS OR THE IRS COULD ADVERSELY
AFFECT OUR EXPECTED JV WITH NEXGEN
In June 2006, we signed a Letter of Intent (LOI) to form a 50/50 joint venture
with NexGen Resources Corporation ("NexGen") to pursue opportunities based upon
our refined coal technology. The joint venture is expected to be structured to
develop and market a refined coal product that will qualify to generate tax
credits under Section 45 under the American Jobs Creation Act of 2004 (the "Jobs
Act"). In addition to the technical requirements for refined coal, further
clarification of the meaning of "market value" as set forth in Section 45 is
required for the planned refined coal product to be economically viable. Such
clarification can occur in one of two ways: either (1) through Congressional
amendment of the Jobs Act, or (2) through regulations issued by the IRS. We
cannot assure you that we will receive the clarification needed, and our
inability to do so will have a material adverse effect on the planned operations
of the expected joint venture with NexGen.
WE ARE AN EMERGING COMPANY IN A NEW INDUSTRY, WHICH ENTAILS RISKS THAT COULD
IMPAIR OUR BUSINESS
We intend to pursue a growth strategy for the foreseeable future by expanding
our environmental technology/specialty chemicals business into the emerging MEC
market. We anticipate that future operations will place a strain on management,
information systems and other resources. We must attract and integrate new
personnel, improve existing procedures and controls and implement new ones to
support future growth. Any inability to meet our future hiring needs and to
adapt our procedures and controls accordingly could have a material adverse
effect on our results of operations, financial condition and business prospects.
In addition, if we make strategic acquisitions, we must successfully integrate
the acquired operations in a timely manner. We cannot assure you that we will
achieve our growth expectations, and our inability to do so could materially
adversely affect our results of operations and business.
WE DEPEND ON KEY PERSONNEL
We depend on the performance of our senior management team -- including Jonathan
Barr, C. Jean Bustard, Dr. Michael Durham, Mark McKinnies, Rich Miller and
Richard Schlager, and their direct reports and other key employees, particularly
highly skilled engineers. Our success depends on our ability to attract, retain
and motivate these individuals. We do not have any binding agreements with any
of our employees that prevent them from leaving our company at any time. We
compete heavily for these personnel. In addition, we do not maintain key person
life insurance on any of our employees. The loss of the services of any of our
key employees or our failure to attract, retain and motivate key employees could
harm our business.
MATERIAL ADJUSTMENTS PURSUANT TO DOE AUDITS OF OUR PAST PERFORMANCE COULD HAVE A
DETRIMENTAL IMPACT ON OUR BUSINESS
We have participated in five contracts awarded by the U.S. Department of Energy
(DOE) and industry that are subject to adjustment as a result of government
audits. These contracts contributed a total of $4.3 million and $4.2 million to
revenues in 2005 and 2004, respectively, of which $2.3 million and $2.4 million,
respectively, were directly from DOE. Including two recently awarded contracts,
the total approved budgets for these contracts combined are $39.8 million, $10.0
million of which is the cost-share portion for us and our industry partners. The
remaining unearned amount of the contracts was $19.4 million as of December 31,
2005, and we expect to recognize $6.2 million in 2006 (including cash
contributions by other industry partners). Our historical experience with these
audits has not resulted in significant adverse adjustments to amounts previously
received, however the audits for the years 2002 through 2005 have not been
finalized. If audits for open years were to require us to repay material
amounts, our results of operations and business would likely suffer material
adverse impacts.
CHANGES IN TAXATION RULES OR FINANCIAL ACCOUNTING STANDARDS COULD ADVERSELY
AFFECT OUR RESULTS OF OPERATIONS
Changes in taxation rules and accounting pronouncements (and changes in
interpretations of accounting pronouncements) have occurred and may occur in the
future. A change in existing taxation rules or accounting standards could have
an adverse effect on our reported results of operations.
RISKS RELATING TO OUR COMMON STOCK
A SIGNIFICANT PORTION OF OUR OUTSTANDING SHARES OF COMMON STOCK MAY BE SOLD IN
THE PUBLIC MARKET IN THE NEAR FUTURE, WHICH COULD LOWER THE MARKET PRICE OF OUR
STOCK
As of July 28, 2006, we had 5,626,893 shares of Common Stock issued and
outstanding of which 789,089, or approximately 14%, are being registered
pursuant to the registration statement of which this Prospectus forms a part.
5
Sales of substantial amounts of our Common Stock, or the perception that such
sales will occur, may have a material adverse effect on our stock price.
THE ISSUANCE OF ADDITIONAL SECURITIES IN THE FUTURE COULD HARM THE BOOK VALUE OF
THE OUTSTANDING SHARES OF COMMON STOCK
To the extent our future funding requirements dictate the issuance of
convertible securities or preferred stock or debt instruments having
liquidation, dividend and other preferences and priorities to the shares of
Common Stock, the shares of Common Stock may suffer a decline in book value. Our
Board of Directors has the authority to authorize the offer and sale of
additional securities without the vote of or notice to existing shareholders,
and it is likely that additional securities may be issued to provide future
financing or in connection with acquisitions. The issuance of additional
securities could dilute the percentage interests and per share book value of
existing shareholders.
LACK OF EXPECTED DIVIDENDS MAY MAKE OUR STOCK LESS ATTRACTIVE AS AN INVESTMENT
We intend to retain all future earnings for use in the development of our
business. We do not anticipate paying any cash dividends on our Common Stock in
the foreseeable future. Generally stocks which pay regular dividends command
higher market trading prices, and so our stock price may be lower as a result of
our dividend policy.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Securities Exchange Act
of 1934, as amended ("Exchange Act"), and, therefore, file reports, proxy
statements and other information with the United States Securities and Exchange
Commission (the "Commission" or "SEC"). The reports, proxy statements and other
information we file with the Commission may be inspected and copied at the SEC's
Public Reference Room at 450 Fifth Street, N.W. Washington, D.C. 20549.
Information on the operation of the Public Reference Room can be obtained by
calling the SEC at 1-800-SEC-0330. The SEC maintains an internet site that
contains reports, proxy and information statements, and other information
regarding issuers that file electronically with the SEC on the Commission's Web
Site at (http://www.sec.gov).
This Prospectus, which constitutes a part of a registration statement on Form
S-3 filed by us with the SEC under the Securities Act of 1933, as amended (the
"Securities Act"), omits certain of the information set forth in the
registration statement. Accordingly, you should reference the registration
statement and its exhibits for further information with respect to our Common
Stock and us. Copies of the registration statement and its exhibits are on file
at the offices of the SEC. Furthermore, statements contained in this Prospectus
concerning any document filed as an exhibit are not necessarily complete and, in
each instance, we refer you to the copy of such document filed as an exhibit to
the registration statement. You should rely only on the information or
representations provided in this Prospectus and the registration statement. We
have not authorized anyone to provide you with different information.
Our Common Stock is currently traded in the over-the-counter market and is
quoted on the NASDAQ Capital Market. Reports, proxy statements and other
information filed by the Company therewith can be inspected at the National
Association of Securities Dealers, Inc. 1735 K Street NW, Washington, D.C.
20006.
FORWARD LOOKING STATEMENTS
This Prospectus contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and 21E of the Securities Exchange Act
of 1934 that relate to matters which involve risks and uncertainties. In
particular such forward-looking statements are found in the section of this
Prospectus entitled "Risk Factors." Words or phrases such as "anticipates,"
"believes," "hopes," "expects," "intends," "plans," "look to" or similar
expressions are used in this Prospectus to identify forward-looking statements,
and such forward-looking statements include, but are not limited to, statements
or expectations that (a) we will become a key supplier of equipment and services
to the coal-fired power generation industry as it seeks to implement reduction
of mercury in flue-gases, (b) contracts we have with the DOE, which generate a
significant part of our revenue, will continue to be funded at expected levels
and that we will be chosen to participate in additional contracts of a similar
nature, (c) current environmental laws and regulations requiring reduction of
mercury from coal-fired boiler flue gases will be upheld and/or strengthened in
pending court proceedings and/or by pending state legislation, and such laws and
regulations will not be materially weakened or repealed by courts or legislation
in the future, (d) we will be able to meet any performance guarantees we make
6
with respect to levels of mercury reduction from systems that we install, (e) we
will be able to appropriately meet our staffing requirements in the face of
anticipated growth, (f) we will be able to retain our key business relationships
with companies with which we have established such relationships, (g) orders we
anticipate receiving will in fact be received, (h) the power industry will
continue to participate in mercury abatement test projects, (i) we will continue
to be able to meet our obligations under contracts as required by those
contracts, (j) governmental audits of our performance under DOE contracts will
not result in material adjustments to amounts we have previously received under
those contracts, (k) we will be able to formulate new chemicals and blends that
will be useful to, and accepted by, the coal-fired boiler power generation
business, (l) we will be able to effectively compete against others who may
choose to participate in our areas of business, (m) adequate supplies of coal
will be available to power generators, (n) we will be able to meet any technical
requirements of projects we undertake, (o) we will be able to obtain adequate
supplies of the materials and supplies needed in our business, including
activated carbon, (p) our efforts to market activated carbon sorbents with
industry partners will be successful, (q) our FGC segment will remain attractive
to the power generation industry, (r) we will be able to obtain adequate
resources and personnel to meet anticipated growth, (s) our stock price will not
be negatively affected by our retaining earnings for future expansion rather
than paying dividends to shareholders and (t) we will have access to adequate
capital to meet our needs. The forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially from
anticipated results. The principal risks and uncertainties that may affect our
actual performance and results of operations include the following: changes in
existing and planned environmental laws, changes in government funding, loss of
key relationships, technical problems with activated carbon injection systems
sold, non-compliance with guarantees on activated carbon injection systems,
decrease in demand for coal, seasonality of our business, inadequate supply of
activated carbon, inadequate supply of coal, lack of or mismanagement of
resources to support future growth, loss of key personnel, changes in taxation
rules or financial accounting standards, dilution resulting from future sales of
Common Stock, and lack of dividend payments to shareholders.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to incorporate by reference the information we file with them,
which means that we can disclose important information to you by referring you
to those documents. The information incorporated by reference is considered to
be part of this Prospectus, and information that we file later with the SEC will
automatically update and supersede the information in this Prospectus.
Accordingly, we incorporate by reference the documents listed below and any
future filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of
the Exchange Act:
1. Our Annual Report on Form 10-KSB, as amended, for the year ended
December 31, 2005, which was originally filed with the SEC on March
30, 2006 and amended on July 26, 2006.
2. Our Definitive Proxy Statement for our 2005 Annual Meeting of
Shareholders to be held May 10, 2006, which was filed with the SEC on
April 10, 2006.
3. Our Additional Definitive Proxy Soliciting Materials and Rule
14(a)(12) Material which was filed with the SEC on April 19, 2006.
4. Our current report on Form 8-K filed with the SEC on April 28, 2006
and July 25, 2006.
5. Our Quarterly Report on Form 10-Q, for the quarter ended March 31,
2006, which was filed with the SEC on May 11, 2006.
6. Our Quarterly Report on Form 10-Q, for the quarter ended June 30,
2006, which was filed with the SEC on August 9, 2006.
7. The description of our Common Stock contained in our Registration
Statement on Form 10-SB filed March 24, 2003, as amended and declared
effective by the Securities and Exchange Commission.
All reports and other documents we subsequently file pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus and
before the filing of a post-effective amendment which indicates that all
securities offered under this Prospectus have been sold or which deregisters all
securities remaining unsold, should also be considered to be part of this
Prospectus from the date of the filing of those reports and documents.
We will provide without charge to each person, including any beneficial owner,
to whom a prospectus is delivered, upon written or oral request a copy of our
annual, quarterly and current reports as filed with the Commission, and a copy
7
of any or all of the other documents incorporated by reference in this document.
The annual report on Form 10-KSB includes our audited financial statements.
Requests should be directed to ADA-ES, Inc., 8100 SouthPark Way, Unit B,
Littleton, Colorado 80120, Attention: Investor Relations (telephone
303-734-1727).
USE OF PROCEEDS
We will not receive any proceeds from the sale of Common Stock by the selling
shareholders. In connection with this offering, we estimate that we will incur
costs of approximately $17,600 for legal, accounting, printing, and other
costs. Any separate costs of selling shareholders will be borne by them.
SELLING SHAREHOLDERS
In October 2005 we entered into several Subscription and Registration Rights
Agreements (the "Sub Docs") and privately sold 789,089 shares of our Common
Stock to the selling shareholders, who are all institutional accredited
investors, at a price of $17.00 per share, for a total offering price of
approximately $13.4 million. The net proceeds to us from the sales totaled
approximately $12.6 million, which will be used for our general working capital
needs. Pritchard Capital Partners LLP and Adams Harkness Inc. acted as the
placement agents for the sales and received a total cash fee of approximately 6%
of the gross proceeds of the offering as well as reimbursement for certain
offering expenses.
As a requirement of the Sub Docs, we agreed to file a registration statement
covering the shares sold pursuant to the Sub Docs with the U.S. Securities and
Exchange Commission within 90 days. The registration for resale of all such
shares of Common Stock issued and outstanding discussed in this paragraph is
included in this Prospectus.
The following table provides certain information, as of the date of this
Prospectus, respecting the selling shareholders, the shares of Common Stock held
by them, to be sold, and to be held following the offering, assuming the sale by
such selling shareholders of all shares of Common Stock offered. This
information is based on information provided to us by the applicable selling
shareholders. We may add additional selling shareholders or update or change the
information in this Section as may be appropriate from time to time through
amendments to the registration statement or the filing of prospectus
supplements. The term "selling shareholders" includes the selling shareholders
listed in the table and their transferees, pledgees, donors or successors of any
of such persons. We will file a prospectus supplement to name any successor to
any named selling shareholder who is able to use the Prospectus to resell
shares.
To the best of our knowledge, none of the selling shareholders are broker
dealers or affiliated with any broker dealers. None of the selling shareholders
has, or within the past three years has had, any position, office or other
material relationship with us. The number of shares in the column "Shares to be
Offered" represents all of the shares that a selling shareholder may offer under
this Prospectus. The selling shareholders may sell some, all or none of their
shares. We are unable to determine the exact amount of shares that actually will
be sold. We currently have no agreements, arrangements or understandings with
the selling shareholders regarding the sale of any of the shares.
Beneficial ownership is calculated in accordance with the rules of the
Securities and Exchange Commission. In computing the number of shares of our
Common Stock beneficially owned by a person, shares of Common Stock subject to
options or warrants held by that person that are currently exercisable or become
exercisable within 60 days following, July 31, 2006, are deemed outstanding.
Unless otherwise indicated, the persons and entities named in the table have
sole voting and investment power with respect to all shares beneficially owned,
subject to community property laws where applicable.
8
----------------------------------------------------------------------------------------------------------
Shares Owned Prior to Securities Owned
the Offering After Offering
----------------------------------------------------------------------------------------------------------
Shares to
Selling Shareholders be offered Number %
----------------------------------------------------------------------------------------------------------
Deephaven Event Trading, LTD (1) 71,947 71,947 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
The Dow Chemical Employees' Retirement -- --
Plan(2)(20) 4,200 4,200
-------------------------------------------- ---------------------- --------------- ------------ ---------
Dynamis Energy Fund, LP (3) 257,134 131,490 125,644 2.2
-------------------------------------------- ---------------------- --------------- ------------ ---------
Dynamis Energy Fund Limited (3) 51,388 18,510 32,878 *
-------------------------------------------- ---------------------- --------------- ------------ ---------
Edison Sources Ltd.(4)(5)(19) 48,000 14,800 33,200 *
-------------------------------------------- ---------------------- --------------- ------------ ---------
Figaro Investments Limited (6)(20) 12,900 1,700 11,200 *
-------------------------------------------- ---------------------- --------------- ------------ ---------
The Government of Singapore Investment
Corp.(7)(20) 16,700 16,700 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
GuggenheimPortfolio Company XII, LLC(8) 6,000 6,000 --
-------------------------------------------- ---------------------- --------------- ------------ ---------
Highbridge International, LLC(9) 20,000 20,000 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
Iroquois Master Fund Ltd.(10) 17,647 17,647 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
J. Caird Investors (Bermuda) L.P. (20) 141,700 29,100 112,600 2.0
-------------------------------------------- ---------------------- --------------- ------------ ---------
J. Caird Partners, L.P. (20) 203,600 28,600 175,000 3.1
-------------------------------------------- ---------------------- --------------- ------------ ---------
MA Deep Event Trading, Ltd. (1) 7,465 7,465 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
Nite Capital LP(11) 23,530 23,530 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
Oregon Investment Council (12)(20) 29,200 29,200 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
Public Sector Pension Investment 20,900 20,900 -- --
Board(13)(20)
-------------------------------------------- ---------------------- --------------- ------------ ---------
Radian Group Inc.(7)(20) 2,500 2,500 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
Raffles Associates, L.P. (14) 63,700 10,000 53,700 *
-------------------------------------------- ---------------------- --------------- ------------ ---------
Raytheon Combined DB/DC Master Trust
(4)(5)(19) 32,700 10,100 22,600 *
-------------------------------------------- ---------------------- --------------- ------------ ---------
Raytheon Master Pension Trust (15)(20) 98,800 8,200 90,600 1.6
-------------------------------------------- ---------------------- --------------- ------------ ---------
Raytheon Master Pension Trust Energy Hedge
Account (4)(5)(19) 50,900 50,900 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
The Retirement Program Plan for Employees of
Union Carbide(2)(20) 4,200 4,200 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
The Robert Wood Johnson Foundation(18)(20) 8,300 8,300 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
Rock Creek Partners Ltd.(16) 50,000 50,000 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
Seneca Capital LP(8) 36,000 36,000 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
Seneca Capital International, Ltd.(8) 75,000 75,000 -- --
-------------------------------------------- ---------------------- --------------- ------------ ---------
SSR Energy & Natural Resource Hedge Fund,
LLC (4)(5)(19) 202,800 74,200 128,600 2.3
-------------------------------------------- ---------------------- --------------- ------------ ---------
WTC-CTF Unconventional Value Portfolio (17) 37,100 7,100 30,000 *
(20)
-------------------------------------------- ---------------------- --------------- ------------ ---------
WTC-CIF Unconventional Value Portfolio (17) 49,600 8,700 40,900 *
(20)
-------------------------------------------- ---------------------- --------------- ------------ ---------
WTC-CIF Micro-Cap Equity Portfolio (17)(20) 3,800 2,100 1,700 *
--------- -------- ------- -----
Totals 1,647,711 789,089 858,622 15.3
========= ======== ======= =====
----------------------------------------------------------------------------------------------------------
* Less than one percent
(1) Deephaven Capital Management LLC ("Deephaven"), acting as investment
adviser, for which Matthew Halbower is Portfolio Manager, has investment
and voting power for the securities, and may be deemed the beneficial owner
of the securities. Deephaven and Mr. Halbower disclaim any such beneficial
ownership.
(2) Kane & Co. is the registration name for The Dow Chemicals Employees'
Retirement Plan and The Retirement Program Plan for Employees of Union
Carbide.
(3) Dynamis Advisors, Inc. ("Dynamis"), acting as investment adviser, for which
Alexander Bocock is Portfolio Manager, has investment and voting power for
the securities, and may be deemed the beneficial owner of the securities.
Dynamis and Mr. Bocock disclaim any such beneficial ownership. Included in
the shares owned prior to and after the offering are 5,000 shares owned by
Mr. Bocock, a principal with Dynamis.
9
(4) Edison Sources Ltd., Raytheon Combined DB/DC Master Trust Energy Hedge
Account, Raytheon Master Pension Trust Energy Hedge Account and SSR Energy
and Natural Resources Hedge Fund LLC are managed by Blackrock, Inc. as
investment advisor. (See also, footnote 19 to this table.)
(5) Jayvee & Co. is the registration name for Edison Sources Ltd., Raytheon
Combined DB/DC Master Trust Energy Hedge Account, Raytheon Master Pension
Trust Energy Hedge Account and SSR Energy and Natural Resources Hedge Fund
LLC.
(6) Hare & Co. is the registration name for Figaro Investments.
(7) Ell & Co. is the registration name for The Government of Singapore
Investment Corporation Pte Ltd. and Radian Group Inc.
(8) Doug Hirsch is the managing member of the investment manager to Guggenheim
Portfolio Company XII, LLC and of the general partner of Seneca Capital,
L.P. and as such has investment and voting power for the securities owned
by both entities. Mr. Hirsch is also the managing member of the general
partner of the investment manager to Seneca Capital International, Ltd.,
and has investment and voting power for the securities. Mr. Hirsch
disclaims beneficial ownership of the securities except to the extent of
his pecuniary interest therein.
(9) Highbridge International, LLC, for which James Thalacker is Portfolio
Manager, has investment and voting power for the securities.
(10) Joshua Silverman has voting and investment control over the securities held
by Iroquois Master Fund Ltd. Mr. Silverman disclaims beneficial ownership
of the securities.
(11) Nite Capital LP, for which Keith A. Goodman is Manager of the General
Partner, has investment and voting power for the securities.
(12) Westcoast & Co is the registration name for the Oregon Investment Council.
(13) Mac & Co. is the registration name for the Public Sector Pension Investment
Board.
(14) Raffles Associates L.P., for which Paul H. O'Leary is General Partner, has
investment and voting power for the securities.
(15) Bost & Co. is the registration name for Raytheon Master Pension Trust.
(16) Rock Creek Partners Ltd., for which James H. Dahl is Managing General
Partner, has investment and voting power for the securities.
(17) Finwell & Co. is the registration name for WTC-CTF Unconventional Value
Portfolio, WTC-CIF Unconventional Value Portfolio and WTC-CIF Micro-Cap
Equity Portfolio.
(18) Benchworthy & CO is the registration name for The Robert Wood Johnson
Foundation.
(19) Blackrock, Inc ("Blackrock") is an investment advisor registered under the
Investment Adviser Act of 1940, as amended. Blackrock, for which Dan Rice
is Portfolio Manager, has sole voting and dispositive power over the
securities and may be deemed the beneficial owner of the securities.
Blackrock and Mr. Rice disclaim any such beneficial ownership.
(20) Wellington Management Company LLP ("Wellington"), in its capacity as an
investment adviser, may be deemed to have beneficial ownership of the
shares of Common Stock that are owned by its investment advisory clients
named in the table, none of which is known to have such interest with
respect to more than five percent of the class of shares. Wellington has
shared voting and investment control over the securities, but disclaims
beneficial ownership thereof. Wellington is a registered investment adviser
under the Investment Advisers Act of 1940, as amended.
PLAN OF DISTRIBUTION
This Prospectus relates to the public offer and sale by the selling shareholders
of 789,089 shares of Common Stock. We may update or change the information in
this Section as may be appropriate from time to time through amendments to the
registration statement or the filing of prospectus supplements. The selling
shareholders and any of their pledgees, donees, transferees, assignees and
successors-in-interest may, from time to time, sell any or all of their shares
of Common Stock on any stock exchange, market or trading facility on which the
shares are traded or in private transactions. These sales may be made directly
or through one or more underwriters, broker-dealers or agents and may be at
prevailing market prices, fixed prices or negotiated prices. The selling
shareholders may use any one or more of the following methods when selling
shares:
10
o ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;
o block trades in which the broker-dealer will attempt to sell the
shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction;
o purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
o an exchange distribution in accordance with the rules of the
applicable exchange;
o privately negotiated transactions;
o settlement of short sales;
o sales through broker-dealers of a specified number of shares at a
stipulated price per share;
o through the writing or settlement of options or other hedging
transactions, whether through an options exchange or otherwise;
o a combination of any such methods of sale; and
o any other method permitted pursuant to applicable law.
The selling shareholders may or may not sell any of their shares of Common Stock
pursuant to this Prospectus. The selling shareholders may also sell shares under
Rule 144 under the Securities Act, if available, or another exemption from
registration under the Securities Act rather than under this Prospectus. The
shares of our Common Stock may be sold in some states only through registered or
licensed brokers or dealers. In addition, in some states, the shares of our
Common Stock may not be sold unless they have been registered or qualified for
sale or the sale is entitled to an exemption from registration.
As of the date hereof, no selling shareholder has advised us that it has entered
into any agreement or understanding with any underwriter, dealer or broker for
the offer or sale of the Common Stock. Broker-dealers engaged by a selling
shareholder may arrange for other brokers-dealers to participate in sales.
Broker-dealers may receive commissions or discounts from the selling
shareholders (or, if any broker-dealer acts as agent for the purchaser of
shares, from the purchaser) in amounts to be negotiated. The selling
shareholders do not expect these commissions and discounts to exceed what is
customary in the types of transactions involved. The selling shareholders may
agree to indemnify any underwriter, dealer or broker that participates in
transactions involving shares against certain liabilities, including liabilities
arising under the Securities Act.
In connection with the sale of our Common Stock or interests therein, the
selling shareholders may enter into hedging transactions with broker-dealers or
other financial institutions, which may in turn engage in short sales of the
Common Stock in the course of hedging the positions they assume. The selling
shareholders may also sell shares of our Common Stock short and deliver these
shares to close out their short positions, or loan or pledge the Common Stock to
broker-dealers that in turn may sell these shares. The selling shareholders may
also enter into option or other transactions with broker-dealers or other
financial institutions or the creation of one or more derivative securities
which require the delivery to such broker-dealer or other financial institution
of shares offered by this Prospectus, which shares such broker-dealer or other
financial institution may resell pursuant to this Prospectus (as supplemented or
amended to reflect such transaction).
If we are notified in writing by a selling shareholder that any material
arrangement has been entered into with a broker-dealer for the sale of Common
Stock through a block trade, special offering, exchange distribution or
secondary distribution or a purchase by a broker or dealer, we will file a
supplement to this Prospectus pursuant to Rule 424(b) under the Securities Act,
disclosing (i) the name of each such selling shareholder and of the
participating broker-dealer(s), (ii) the number of shares involved, (iii) the
price at which such the shares of Common Stock were sold, (iv) the commissions
paid or discounts or concessions allowed to such broker-dealer(s), where
applicable, (v) that such broker-dealer(s) did not conduct any investigation to
verify the information set out or incorporated by reference in this Prospectus,
and (vi) other facts material to the transaction. Upon our being notified in
writing by a selling shareholder that a donee or pledgee intends to sell shares
of Common Stock, we will file a supplement to this Prospectus if then required
in accordance with applicable securities laws.
The selling shareholders and any broker-dealers or agents that are involved in
selling the shares may be deemed to be "underwriters" within the meaning of the
Securities Act in connection with such sales. In such event, any commissions
received by such broker-dealers or agents and any profit on the resale of the
shares purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act. Discounts, concessions, commissions and
similar selling expenses, if any, that can be attributed to the sale of the
shares will be paid by the selling shareholder and/or the purchasers. Each
selling shareholder has represented and warranted to us that it acquired the
11
shares subject to this registration statement for its own account, not as a
nominee or agent, for investment purposes and not with a view towards
distribution or resale within the meaning of the Securities Act.
Selling shareholders may not use shares registered on this Registration
Statement to cover short sales of Common Stock made prior to the date on which
this Registration Statement becomes effective. If a selling shareholder uses
this Prospectus for any sale of the Common Stock, it will be subject to the
prospectus delivery requirements of the Securities Act. The selling shareholders
will be responsible for complying with the applicable provisions of the
Securities Act and Exchange Act, and the rules and regulations thereunder
promulgated, including, without limitation, Regulation M, as applicable to such
selling shareholders in connection with resales of their respective shares under
this Registration Statement.
Once sold under the registration statement of which this Prospectus forms a
part, the shares of Common Stock will be freely tradable in the hands of persons
other than our affiliates.
We have agreed to indemnify and hold harmless the selling shareholders and each
of their respective officers, directors, certain representatives and persons
controlling the selling shareholders from and against any claim or liability
under the Securities Act or otherwise if such liability or claim arises out of a
material untrue statement or a material omission in the registration statement
of which this Prospectus is a part or this Prospectus. We also have agreed to
reimburse such persons for all legal and other expenses incurred by them in
connection with investigating or defending any such claim. This obligation to
indemnify does not apply, however, if the liability arises from (a) a material
untrue statement or a material omission (i) in reliance upon or in conformity
with written information furnished to us by the selling shareholder or (ii) that
was corrected in a final prospectus furnished to the selling shareholder but
which the selling shareholder failed to deliver to the purchaser or (b) use of a
registration statement or prospectus after we have notified the selling
shareholder that a stop order has been issued in respect of such registration
statement or prospectus or any proceedings for that purpose have been initiated
or use of a prospectus when such use has been suspended (collectively, "Excluded
Liabilities").
The selling shareholders have agreed to indemnify and hold us, our officers,
directors, certain representatives and each person who controls us, harmless
from and against any Excluded Liability and have agreed to reimburse us and such
persons for all legal and other expenses incurred by us and them in connection
with investigating or defending any such claim.
Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to directors, officers or persons controlling us pursuant to the
foregoing provisions or otherwise, we have been informed 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.
TRANSFER AGENT AND REGISTRAR
Computershare Investor Services is the transfer agent and registrar for our
Common Stock. It is located at Suite 800, 350 Indiana Street, Golden, CO 80401,
telephone (303) 262-0600.
LEGAL MATTERS
Certain legal matters with respect to the legality of the securities offered and
the organization and existence of our company have been passed upon for us by
Schuchat, Herzog & Brenman, LLC, 1900 Wazee Street, Suite 300, Denver, Colorado
80202.
EXPERTS
The consolidated financial statements which are incorporated by reference in
this Prospectus by reference from our Annual Report on Form 10-KSB as of and for
the year ended December 31, 2005, have been audited by Hein & Associates LLP, an
independent registered public accounting firm, as stated in their report, which
are incorporated herein by reference, and have been so incorporated in reliance
upon such report given the authority of that firm as experts in accounting and
auditing.
12
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the various expenses payable by the
Registrant in connection with the sale and distribution of the securities being
registered. All of the amounts shown are estimated except for the Securities and
Exchange Commission registration fee and listing fees. The Selling Shareholders
will not be paying any of these expenses.
SEC registration fee $ 1,878.47
Printing and mailing expenses $ 500.00
Reimbursable expenses of placement agents $ 31,579.47
Legal fees and expenses $ 5,000.00
Accounting fees and expenses $ 2,000.00
Listing fees $ 7,890.89
Stock transfer agent fees $ 317.50
-----------
Total $ 49,186.33
===========
Item 15. Indemnification of Directors and Officers.
Limitation of Director Liability
The Colorado Business Corporation Act allows a Colorado corporation to
eliminate or limit the personal liability of a director to his corporation or to
its shareholders for monetary damages for a breach of fiduciary duty as a
director, except for liabilities arising from any breach of the director's duty
of loyalty to the corporation or its shareholders, from acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, from any transaction from which the director derived an improper personal
benefit, or from any other act, omission or transaction as to which the Colorado
Business Corporation Act prohibits the elimination or limitation of liability.
Our Amended and Restated Articles of Incorporation (the "Articles") contain such
a provision limiting director liability.
Indemnification of Directors, Officers and Others
The Colorado Business Corporation Act allows a corporation to indemnify its
directors, officers, employees, fiduciaries and agents against liability in
certain situations. Our Articles provide that we will indemnify our directors,
officers, employees, fiduciaries and agents (each, a "Proper Person" as defined
in our Amended and Restated Bylaws (the "Bylaws")) to the maximum extent
provided by law.
Under the Colorado Business Corporation Act and our Articles,
indemnification would be mandatory with respect to a director or officer who was
wholly successful in defense of an action, suit or proceeding. As permitted by
the Colorado Business Corporation Act, our Bylaws provide the following as to
the indemnification of Proper Persons:
- We will indemnify any Proper Person against reasonably incurred
expenses, judgments, penalties, fines and amounts paid in settlement
reasonably incurred by him in connection with an action, suit or
proceeding if it is determined that he conducted himself in good faith
and that he reasonably believed (i) in the case of conduct in his
official capacity, that his conduct was in the Company's best
interests, or (ii) in all other cases (except criminal cases), that
his conduct was at least not opposed to the Company's best interests,
or (iii) in the case of a criminal proceeding, that he had no
reasonable cause to believe his conduct was unlawful.
- In proceedings brought by or in the right of the Company,
indemnification will be limited to reasonable expenses incurred in
connection with the proceeding.
- No indemnification will be provided a Proper Person with respect to
any claim, issue or matter in connection with a proceeding by or in
the right of the Company in which the Proper Person was adjudged to be
liable to the Company on in any proceeding charging that the Proper
Person derived an improper personal benefit, whether or not involving
action in an official capacity, in which he was adjudged to be liable
to the Company on the basis that he derived an improper personal
benefit.
Additional indemnification may be provided to officers, employees,
fiduciaries or agents if they are not also directors, so long as such additional
indemnification is provided for by general or specific action by the Board of
Directors or shareholders or by contract and would not be inconsistent with
public policy.
Insurance
Under the Colorado Business Corporation Act and our Articles, the Company
may obtain insurance on behalf of its directors, officers, employees,
fiduciaries and agents against liabilities incurred by them in those capacities.
We may maintain insurance to protect us and them against expenses, liabilities
and losses whether or not we would have the power to indemnify them under
Colorado law. We purchase and maintain directors' and officers' liability and
company reimbursement liability insurance policies.
Item 16. Exhibits.
Exhibit
Number Description
------ -----------
4.1 Specimen Common Stock Certificate (1)
4.2 Registration Rights Agreement dated October 21, 2005 (2)
5.1* Opinion of Schuchat, Herzog & Brenman, LLC as to legality of the
shares
23.1** Consent of Hein & Associates LLP
23.2* Consent of Schuchat, Herzog & Brenman, LLC (contained in
Exhibit 5.1)
* Previously filed as the like numbered Exhibit to Registrant's Registration
Statement on Form S-3, SEC File No. 333-131085, on January 17, 2006.
** Filed herewith.
--------------------------------------------------------------------------------
(1) Incorporated by reference to Exhibit 4.1 to the Form 8-K dated October 21,
2005 filed on October 26, 2005. (2) Incorporated by reference to Exhibit 10.1 to
the Form 8-K dated October 21, 2005 filed on October 26, 2005.
Item 17. Undertakings.
a. The undersigned registrant hereby undertakes:
(1) To file, during any period in which it offers or sells securities, 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;
(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.
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
ii
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 additional or changed material information on 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 in subparagraphs (i), (ii) and (iii)
above do not apply to a Registration Statement on Form S-3, if the information
required to be included in a post-effective amendment is contained in reports
filed with or furnished to the Commission by the registrant pursuant to section
13 or 15(d) of the Securities Exchange Act of 1934 or is contained in a form of
prospectus filed pursuant to Rule 424(b) that is part of the 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) File a post-effective amendment to remove from registration any of the
securities that remain unsold at the end of the offering.
(4) Not applicable.
(5) That, for the purpose of determining liability under the Securities
Act of 1933 to any purchaser:
(i) Not applicable.
(ii) Each prospectus filed pursuant to Rule 424(b) as part of a
registration statement relating to an offering, other than
registration statements relying on Rule 430B or other than
prospectuses filed in reliance on Rule 430A, shall be deemed to be
part of and included in the registration statement as of the date
it is first used after effectiveness. Provided, however, that no
statement made in a registration statement or prospectus that is
part of the registration statement or made in a document
incorporated or deemed incorporated by reference into the
registration statement or prospectus that is part of the
registration statement will, as to a purchaser with a time of
contract of sale prior to such first use, supersede or modify any
statement that was made in the registration statement or
prospectus that was part of the registration statement or made in
any such document immediately prior to such date of first use.
(6) That, for the purpose of determining liability of the registrant under
the Securities Act of 1933 to any purchaser in the initial
distribution of the securities: The undersigned registrant undertakes
that in a primary offering of securities of the undersigned registrant
pursuant to this registration statement, regardless of the
underwriting method used to sell the securities to the purchaser, if
the securities are offered or sold to such purchaser by means of any
of the following communications, the undersigned registrant will be a
seller to the purchaser and will be considered to offer or sell such
securities to such purchaser:
(i) Any preliminary prospectus or prospectus of the undersigned
registrant relating to the offering required to be filed pursuant
to Rule 424;
(ii) Any free writing prospectus relating to the offering prepared by
or on behalf of the undersigned registrant or used or referred to
by the undersigned registrant;
(iii) The portion of any other free writing prospectus relating to the
offering containing material information about the undersigned
registrant or its securities provided by or on behalf of the
undersigned registrant; and
iii
(iv) Any other communication that is an offer in the offering made by
the undersigned registrant to the purchaser.
b. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to section 13(a) or
section 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual report
pursuant to section 15(d) of the Securities Exchange Act of 1934) that
is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
h. 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.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant hereby 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 and any amendment thereto to be signed on its behalf by
the undersigned, thereunto duly authorized, in the City of Littleton, State of
Colorado on August 24, 2006.
ADA-ES, INC.
Date: August 24, 2006 /s/ Michael D. Durham
------------------------------------------
President and Chief Executive Officer
Date: August 24, 2006 /s/ Mark H. McKinnies
------------------------------------------
Mark H. McKinnies, Principal Financial and
Accounting Officer
Pursuant to the requirements of the Securities Exchange Act of 1933, as
amended, this Registration Statement and any amendment thereto has been signed
below by the following persons in the capacities and on the dates indicated.
Date:
------------------------------------------
Robert N. Caruso, Director
Date: August 24, 2006 /s/ John W. Eaves
------------------------------------------
John W. Eaves, Director
iv
Date: August 24, 2006 /s/ Michael D. Durham
------------------------------------------
Michael D. Durham, Director
Date: August 24, 2006 /s/ Derek C. Johnson
------------------------------------------
Derek C. Johnson, Director
Date: August 24, 2006 /s/ Ronald B. Johnson
------------------------------------------
Ronald B. Johnson, Director
Date: August 24, 2006 /s/ Mark H. McKinnies
------------------------------------------
Mark H. McKinnies, Director
Date: August 24, 2006 /s/ Rollie J. Peterson
------------------------------------------
Rollie J. Peterson, Director
Date: August 24, 2006 /s/ Jeffrey C. Smith
------------------------------------------
Jeffrey C. Smith, Director
Date:
------------------------------------------
Richard J. Swansan
v