<SEC-DOCUMENT>0000950123-11-048366.txt : 20110510
<SEC-HEADER>0000950123-11-048366.hdr.sgml : 20110510
<ACCEPTANCE-DATETIME>20110510163709
ACCESSION NUMBER:		0000950123-11-048366
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20110510
ITEM INFORMATION:		Other Events
FILED AS OF DATE:		20110510
DATE AS OF CHANGE:		20110510

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			FUEL TECH, INC.
		CENTRAL INDEX KEY:			0000846913
		STANDARD INDUSTRIAL CLASSIFICATION:	INDUSTRIAL & COMMERCIAL FANS & BLOWERS & AIR PURIFYING EQUIP [3564]
		IRS NUMBER:				205657551
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-33059
		FILM NUMBER:		11828721

	BUSINESS ADDRESS:	
		STREET 1:		27601 BELLA VISTA PARKWAY
		CITY:			WARRENVILLE
		STATE:			IL
		ZIP:			60555
		BUSINESS PHONE:		6308454433

	MAIL ADDRESS:	
		STREET 1:		27601 BELLA VISTA PARKWAY
		CITY:			WARRENVILLE
		STATE:			IL
		ZIP:			60555

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	FUEL TECH N V
		DATE OF NAME CHANGE:	19930510
</SEC-HEADER>
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<TYPE>8-K
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<DESCRIPTION>FORM 8-K
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<DIV align="center" style="font-size: 14pt; margin-top: 12pt"><B>UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION</B>
</DIV>

<DIV align="center" style="font-size: 12pt"><B>Washington, D.C. 20549</B>
</DIV>

<DIV align="center" style="font-size: 18pt; margin-top: 12pt"><B>FORM 8-K</B>
</DIV>


<DIV align="center" style="font-size: 12pt; margin-top: 12pt"><B>CURRENT REPORT<BR>
Pursuant to Section&nbsp;13 or 15(d) of The Securities Exchange Act of 1934</B>
</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B>Date of Report (Date of earliest event reported): May&nbsp;10, 2011</B></DIV>

<DIV align="center" style="font-size: 24pt; margin-top: 12pt"><B>FUEL TECH, INC.</B>
</DIV>

<DIV align="center" style="font-size: 10pt">(Exact name of registrant as specified in its charter)</DIV>


<DIV align="center">
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    <TD width="30%">&nbsp;</TD>
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<TR valign="bottom">
    <TD align="center" valign="top"><B>Delaware</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>001-33059</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>20-5657551</B></TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">(State or other jurisdiction <BR>
of incorporation)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(Commission<BR>
File Number)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(IRS Employer<BR>
Identification No.)</TD>
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</DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B>Fuel Tech, Inc.<BR>
27601 Bella Vista Parkway<BR>
Warrenville, IL 60555-1617<BR>
630-845-4500</B></DIV>

<DIV align="center" style="font-size: 10pt; margin-top: 12pt"><B>(Address and telephone number of principal executive offices)</B></DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provision:</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT style="font-family: Wingdings">&#111;</FONT> Written communications pursuant to Rule&nbsp;425 under the Securities Act (17 CFR 230.425)
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT style="font-family: Wingdings">&#111;</FONT> Soliciting material pursuant to Rule&nbsp;14a-12 under the Exchange Act (17 CFR 240.14a-12)
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT style="font-family: Wingdings">&#254;</FONT> Pre-commencement communications pursuant to Rule&nbsp;14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><FONT style="font-family: Wingdings">&#111;</FONT> Pre-commencement communications pursuant to Rule&nbsp;13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
</DIV>


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<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;8.01 &#151; Other Events</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B><I>Explanatory Note:</I></B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fuel Tech, Inc. (the &#147;Company&#148;) will hold its 2011 Annual Meeting of Stockholders (the &#147;Annual
Meeting&#148;) on Thursday, May&nbsp;19 2011 at 10:00&nbsp;a.m. local time at the Company&#146;s corporate
headquarters, located at 27601 Bella Vista Parkway, Warrenville, Illinois 60555. The proxy
statement for the Annual Meeting was first mailed to stockholders on or about April&nbsp;8, 2011. This
Report on Form 8-K provides certain supplemental disclosure to the proxy statement.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B><I>Purpose of the Outreach</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">At our annual meeting of stockholders to be held on May&nbsp;19, 2011, the Company&#146;s stockholders will
vote on whether to approve an exchange program pursuant to which eligible employees would be
offered the opportunity to exchange eligible options for grants of restricted stock units (RSUs) at
ratios determined by the Company&#146;s  Compensation and Nominating Committee and intended to represent a
value-for-value exchange (the &#147;Exchange Program&#148;). Item&nbsp;2 in the Company&#146;s proxy materials
includes further information regarding this proposal.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Two proxy advisory firms have recently issued voting recommendations with respect to the Exchange
Program. We are pleased that Glass Lewis &#038; Co. (&#147;Glass Lewis&#148;), an independent proxy advisory firm,
has recommended that its clients vote &#147;FOR&#148; the Exchange Program proposal, although we see another
proxy advisory firm, ISS Proxy Advisory Services (&#147;ISS&#148;), has recommended that its clients vote
&#147;AGAINST&#148; this proposal.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">We reviewed ISS&#146;s analysis of our proposal, and the reason they set out for recommending an
&#147;AGAINST&#148; vote is that they do not consider it a value-for-value exchange. We believe the
difference lies in the method and stock inputs they used. We want to explain why we believe our
calculation is more appropriate, and why we urge you to follow our recommendation and the Glass
Lewis recommendation and vote &#147;FOR&#148; the Exchange Program proposal.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B><I>Value-for-value exchange: our methodology</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">In our proxy statement dated April&nbsp;5, 2011 we described the methods by which we proposed to
calculate the value of options surrendered in the offer, and the value of the RSUs to be granted.
These methods follow our financial statement disclosures according to generally accepted accounting
principles (GAAP). Under these methods, we value stock options using appropriate valuation
techniques which are widely accepted and stock price inputs as of the valuation date and expected
volatility over the remaining expected term based on the historical volatility for a similar term
ending on the valuation date. We value RSUs based on the stock price at the valuation date. For
purposes of the Exchange Program, the valuation date is the most recent practicable date prior to
commencement of the offer to exchange, and in the illustrative examples included in our proxy
statement, we assumed a valuation date of March&nbsp;31, 2011.
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B><I>Value-for-value exchange: ISS methodology</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">For their analysis of our proposed Exchange Program we understand ISS used a binomial pricing
model, using a stock price calculated as a 200&nbsp;day average of prices ending on December&nbsp;1, 2010 and
volatility measured over the same period. RSUs are valued at the 200&nbsp;day average price as well.
The resulting stock price and volatility were both lower than we used, and resulted in the options
having a lower value than we calculated, and the RSUs having a lower value than we used. Using
these values, ISS calculated that under the illustrative exchange ratios we set forth in the proxy
statement the aggregate value of the RSUs was greater than the aggregate value of the options
surrendered.
</DIV>





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<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B><I>Why we think our methodology is better:</I></B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">We think our methodology is more appropriate for the following reasons:
</DIV>


<DIV style="margin-top: 6pt">
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt">

<TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our method is consistent with GAAP and the way we will account for the exchange program
when and if consummated.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our method, and the method used in setting the actual terms of the offer, uses current
stock information, rather than stale information.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>Our method uses volatility measured for each tranche of options, resulting in a more
accurate measure than the one-size-fits-all approach.</TD>
</TR>

<TR>
    <TD style="font-size: 6pt">&nbsp;</TD>
</TR><TR valign="top" style="font-size: 10pt; color: #000000; background: transparent">
    <TD width="3%" style="background: transparent">&nbsp;</TD>
    <TD width="2%" nowrap align="left"><B>&#149;</B></TD>
    <TD width="1%">&nbsp;</TD>
    <TD>The use of a non-GAAP valuation method could result in the Company incurring
compensation charges for financial statement purposes for the period in which the offer is
consummated, depending on the values measured for GAAP purposes.</TD>
</TR>

</TABLE>
</DIV>
<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Simply put, we believe the valuation methods adopted by the Company will better reflect the current
values of the stock options and RSUs than the values resulting from the use of ISS&#146;s proprietary
model and December&nbsp;1, 2010 measuring point.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Your vote is important. Our board of directors has recommended that you vote &#147;FOR&#148; the Exchange
Program proposal approving the program permitting the exchange of certain stock options for
restricted stock units.</B>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SIGNATURES</B>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned hereunto duly authorized.
</DIV>


<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
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    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>Fuel Tech, Inc.</B><BR>
(Registrant)<BR>
<BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">Date: May&nbsp;10, 2011</TD>
    <TD colspan="3" align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>

<TR>
    <TD align="left">&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>
    <TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/ David S. Collins
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">David S. Collins&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Chief Financial Officer,<BR>
Sr. Vice President and<BR>
Treasurer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
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