We continue to place greater attention and resources on our nuclear business.

           Currently, M&EC's revenues are generated primarily pursuantfinancial assurance that guarantees to three subcontracts under contractsthe state that in the event of closure of our permitted facilities will be closed in accordance with the U. S. Departmentregulations.  The policies provide a maximum of Energy (the "DOE"). Each$35,000,000 of these subcontracts provides that the contractor, on its or the DOE's behalf, may terminate the contracts underfinancial assurance coverage of which the subcontractscoverage amount totals $32,515,000 at December 31, 2008.  In March 2009, the policies were increased to provide a maximum of $39,000,000 of financial assurance coverage of which the coverage amounts totals $37,936,000.  This additional increase was the result of additional financial assurance coverage requirement for our DSSI subsidiary to commercially store and dispose of PCB wastes under a permit issued at any time by notifying us. If we fail to maintain, renew, or replace these contracts, M&EC's revenuesthe EPA on November 26, 2008.  The AIG subsidiary also provides other operating insurance policies for the Company and our subsidiaries.  In the event of a failure of AIG, this could be materially reduced, and your investment could be materially and adversely affected.

If we cannot maintain our government permits or cannot obtain any required permits, we may not be able to continue or expand our operations.

           Our business is subject to extensive, evolving, and increasingly stringent federal, state, and local environmental laws and regulations. Such federal, state, and local environmental laws and regulations govern our activities regarding the treatment, storage, recycling, disposal, and transportation of hazardous and non-hazardous waste and low-level radioactive waste. We must obtain and maintain permits, licenses and/or approvals to conduct these activities in compliance with such laws and regulations. Failure to obtain and maintain the required permits, licenses and/or approvals would have a material adverse effect onimpact our operations and financial condition. Ifour permits which we are unablerequired to maintainhave in order to operate our currently held permits, licenses, and/or approvals or obtain any additional permits, licenses and/or approvals which may be required as we expand our operations, we may not be able to continue certain of our operations.

Changes in environmental regulations and enforcement policies could subject us to additional liability and adversely affect our ability to continue certain operations.

           Because the environmental industry continues to develop rapidly, we cannot predict the extent to which our operations may be affected by future enforcement policies as applied to existing laws, by changes to current environmental laws and regulations, or by the enactment of new environmental laws and regulations. Any predictions regarding possible liability under such laws are complicated further by current environmental laws which provide that we could be liable, jointly and severally, for certain activities of third parties over whom we have limited or no control.

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If we are unable to become profitable, we may be unable to comply with certain government regulations and could become subject to substantial fines or lose our permits.

           The standards imposed by federal, state, and local environmental laws require us to incur additional expenses as necessary to upgrade our facility. Our inability to become profitable on a long-term basis could have a negative impact on our ability to remain in compliance with various federal, state, and local environmental regulations. Violation of such federal, state, and local regulations could result in the loss of one or more of our permits or subject us to substantial fines, penalties, or other liabilities that could have a material adverse impact on our financial condition and our ability to continue certain of our operations.

As our operations expand, we may be subject to increased litigation which could have a negative impact on our future financial results.

           Our operations are regulated by numerous laws regarding procedures for waste treatment, storage, recycling, transportation, and disposal activities, all of which may provide the basis for litigation against us. In recent years, the waste treatment industry has experienced a significant increase in so-called "toxic-tort" litigation as those injured by contamination seek to recover for personal injuries or property damage. We believe that as our operations and activities expand, there will be a similar increase in the potential for litigation alleging that we are responsible for contamination or pollution caused by our normal operations, negligence or other misconduct, or for accidents which occur in the course of our business activities. Such litigation, if significant and not adequately insured against, could adversely affect our financial condition and our ability to fund our operations. Protracted litigation would likely cause us to spend significant amounts of our time, effort, and money. This could prevent our management from focusing on our operations and expansion.

facilities.

Our operations will suffer if we are unable

materially adversely affected.

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business.  Allowable costs under U.S. government contracts are subject to audit by the U.S. government.  If these audits result in determinations that costs claimed as reimbursable are not allowed costs or were not allocated in accordance with applicable regulations, we cannot retain our key personnel, we may lose significant revenues,could be required to prepayreimburse the U.S. government for amounts previously received.

governmental contracts or subcontracts involving governmental facilities, claims for civil or criminal fraud may be brought by the government or violations of these regulations, requirements or statutes.

           Our credit facility provides

operations and liquidity.

waste management company. Our revenues in our Industrial Waste Management Services arebusiness is subject to economic downturns.

           Our Industrial Waste Management Services segment is generally adversely affected by economic downturns. Reductions in industrial production results in reduced levelsextensive, evolving, and increasingly stringent federal, state, and local environmental laws and regulations. Such federal, state, and local environmental laws and regulations govern our activities regarding the treatment, storage, recycling, disposal, and transportation of hazardous and non-hazardous waste being generated and/and low-level radioactive waste. We must obtain and maintain permits or sent off for treatment.  licenses to conduct these activities in compliance with such laws and regulations. Failure to obtain and maintain the required permits or licenses would have a material adverse effect on our operations and financial condition. If any of our facilities are unable to maintain currently held permits or licenses or obtain any additional permits or licenses which may be required to conduct its operations, we may not be able to continue those operations at these facilities, which could have a material adverse effect on us.

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quantity of rights to purchase our common stock could result in a significant dilution in the percentage ownership interest of our stockholders and the dilution in ownership value. Future sales of the shares issuable could also depress the market price of our common stock.

            The terms of the Series 17 Preferred allow us to pay dividends on the outstanding Series 17 Preferred in cash or common stock. We currently intend to pay the dividends accruing on the Series 17 Preferred in common stock if, and when, declared and paid by our Board of Directors. The actual number of shares of common stock issuable in payment of accrued dividends on the Series 17 Preferred will depend upon the length of time the Series 17 Preferred is outstanding and the price of the common stock at the time of payment of dividends. Our credit facilityCredit Facility prohibits us from paying cash dividends on our common stock.

Wemarket price of our common stock will not realize a benefit fromcontinue to fluctuate. This may make it difficult for you to resell the common stock when you want or at prices you find attractive.

            Weany, that future issuances or sales of shares of common stock or the availability of shares of common stock for future issuance, will have approximately $19.2 million in net operating loss carryforwards which will expire from 2007 to 2021 if not used againston the trading price of our common stock.  Such future federal income tax liabilities. Our net loss carryforwards are subject to various limitations and have not been approved by the Internal Revenue Service. We anticipate the net loss carryforwards will be used toissuances could also significantly reduce the federal income tax payments which we would otherwise be required to make with respect to income, if any, generated in future years.

percentage ownership and dilute the ownership value of our existing common stockholders.

The issued

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           Under our Restated Certificate of Incorporation, as amended (the "Certificate"), as of October 1, 2002, 40,701,618 shares of common stock (including 988,000 treasury shares) are available for future issuance, of which 18,760,619 areStock reserved for issuance under our outstanding preferred stock, options and warrants.share rights plan).  These authorizedunissued shares are necessary to provide us with the ability to issue common stock from time to time as needed for proper corporate purposes, such as:

            *      raising capital funds through private or public offerings;

            *      acquiring other companies;

            *      declaring stock splits or stock dividends; and

            *      issuing common stock under warrants, preferred stock, or other rights which may be granted by us 
                    from time to time in the future.

            Additional authorization of shares of common stock could be used by incumbentour management to make it more difficult, and thereby discourage an attempt to acquire control of us, even thoughus.

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           *      future federal tax audit or auditsdate on which could reduce our loss carryforwards;
           *      limitations imposed by the Internal Revenue Code or our inability to utilize our loss carryforwards;
           *      inability to develop new and existing technologies in the conduct of operations or to develop such
                   technologies for commercial use;
           *     changes in federal, state, and local laws and regulations, especially environmental regulations, or 
                   in the interpretation of such laws and regulations;
           *      potential increases in equipment, maintenance, operating or labor costs;
           *      management retention and development;
           *      inability to become profitable, and, if unable to become profitable, our inability to secure additional 
                   liquidity in the form of additional equity or debt;
           *      inability to maintain the listing of our common stock on the Nasdaq;
           *      cancellation of one or more subcontracts issued to M&EC in connection with government contracts;
           *      M&EC's limited operating history; and
           *      the factors set forth under "Risk Factors" beginning on page 2 of this prospectus.

            In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "could," "would," "expect," "plan," "anticipate," "believe," "continue," or the derivative of these terms or other similar expressions. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified by the cautionary statements included in this prospectus.that statement is made.  We undertake no obligation to update or revise ourforward-looking statements,publicly any forward-looking statement, whether as a result of new information, future events or otherwise.  In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this prospectus might not occur.

Private Placement: Unit Warrants and Placement Agent Warrants

            On July 30, 2001, we completed a private placement offering of units (the "Private Placement") to accredited investors. Each unit is comprised of one share of our common stock and one warrant to purchase one share of common stock (a "Unit Warrant"). The purchase price for each unit was $1.75, and the exercise price of each Unit Warrant is $1.75, subject to adjustment under certain conditions. We accepted subscriptions for 4,397,566 of the maximum 4,400,000 units offered, for an aggregate purchase price of $7,695,740. This prospectus is part of the registration statement which registers for resale 4,010,638 of the 4,397,566 shares of common stock issued pursuant to the Private Placement and 4,352,893 of the 4,397,566 shares of common stock issuable upon the exercise of the Unit Warrants issued pursuant to the Private Placement.

           Under the terms of the Private Placement, we appointed Larkspur Capital Corporation ("Larkspur"), Ryan, Beck & Co., formerly Ryan, Beck & Co., L.L.C. ("Ryan Beck"), and National Securities Corporation ("National") as placement agents (each, a "Placement Agent") to place the units as our agent and to assist in completing the Private Placement. We paid each Placement Agent a private placement fee equal to 7.5% of the aggregate purchase price for units placed by that particular Placement Agent. We also issued to each Placement Agent warrants to purchase up to the number of shares of common stock equal to 7% of the aggregate purchase price for units placed by that particular Placement Agent, divided by $1.75 (the "Placement Agent Warrants"). The Placement Agent Warrants are for a term of five years and have an exercise price of $1.75 per share. As a result, we paid the Placement Agents $202,500 in total fees and issued to them Placement Agent Warrants for the purchase of up to an aggregate of 108,000 shares of common stock. On June 26, 2002, Ryan Beck assigned a portion of its Placement Agent Warrants for the purchase of 11,000 shares to managing directors of Ryan Beck. On July 17, 2002, Larkspur assigned all of its Placement Agent Warrants for the purchase of 34,000 shares to certain managing directors of Larkspur. On July 30, 2002, Ryan Beck assigned to Associated Mezzanine Investors, L.L.C. ("AMI") a portion of such warrants for the purchase of 10,000 shares, and Larkspur assigned to AMI a portion of such warrants for the purchase of 10,000 shares.  This prospectus is part of the registration statement which registers for resale the 108,000 shares issuable upon the exercise of the Placement Agent Warrants.

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           The exercise price and the number of shares of common stock issuable upon the exercise of the Unit Warrants and Placement Agent Warrants are subject to adjustment, from time to time, if we:

           The Note Warrants are exercisable at any time, from time to time, beginning July 31, 2001, until July 31, 2008 at an exercise price of $1.50 per share of common stock. The Note Warrants may also be exercised at the option of the holder pursuant to a cashless exercise provision, which permits the holder to surrender the Note Warrants in exchange for the

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number of shares of common stock equal to the product of the number of shares of common stock designated to be exercised multiplied by a fraction, the numerator of which is the current market price of the common stock less $1.50, the denominator of which is the current market price. The number of shares of common stock issuable upon exercise of the Note Warrants and the exercise price of the Note Warrants are subject to adjustment under certain circumstances summarized below.

            If, at any time after July 31, 2001, we issue or sell additional shares of common stock (including certain option and convertible securities under which common stock may be issued) without consideration or for a consideration per share less than the market price of the common stock on the date of, and immediately prior to, such issue or sale, the exercise price of the Note Warrants will be reduced to a price determined by multiplying the exercise price by a fraction:

            (a)    the number of shares of common stock outstanding immediately prior to such issue or sale, plus

            (b)    the number of shares of common stock which the aggregate consideration received by us for the 
                     total number of such additional shares of common stock issued or sold would purchase at the 
                     then market price; and

            Upon an adjustment in the exercise price of the Note Warrants, the number of shares issuable upon exercise of the Note Warrants will be adjusted by multiplying the number of shares of common stock which would otherwise be issuable upon such exercise by a fraction:

            *      the numerator of which is $1.50; and

            *      the denominator of which is the exercise price, as may be adjusted under the terms of the Note Warrants.

             If after July 31, 2001, we declare a dividend or other distribution on our common stock other than a dividend payable in common stock or options for common stock or a regular periodic dividend payable in cash and declared out of earned surplus of the Company, the exercise price in effect prior to the record date for such dividend will be reduced to a price determined by multiplying the exercise price by a fraction (a) the numerator of which will be the current market price on such record date less the value of the dividend or distribution applicable to one share of common stock; and (b) the denominator of which shall be the current market price.

           The Note Warrants' anti-dilution terms further provide that, if after July 31, 2001, we:

           *      consolidate with or merge into another person without being the continuing or surviving corporation; or

           *      consolidate or merge with another person in which we are the continuing or surviving corporation but 
                   our common stock or other securities are exchanged for other securities of another person; or

           *      we transfer all or substantially all of our properties; or

           *      we effect a capital reorganization or reclassification of our common stock or other securities which are 
                   not subject to the anti-dilution provisions discussed above,

then the holders of the Note Warrants will be entitled to receive the amount of cash, securities or other property, which the holder would have been entitled to receive if holder had exercised the Note Warrants immediately prior to the transaction.

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An exception to the above sentence is if a purchase, tender, or exchange offer has been accepted by our stockholders and following such purchase, tender, or exchange offer, the maker thereof, together with its affiliates own more than 50% of our outstanding common stock, then holders of the Note Warrants have the option to receive the amount of cash, securities, or other property to which the holder would have been entitled, if the holder of the Note Warrants had exercised the Note Warrants prior to the expiration of such purchase, tender or exchange offer and accepted such offer, and all of the common stock held by such holder had purchased pursuant to such purchase, tender or exchange offer.

The Subordinated Notes and Note Warrants were sold pursuant to an exemption from registration under Section 4(2) of the Securities Act of 1933, as amended (the "Act"), and/or Rule 506 of Regulation D promulgated under the Act, and, therefore, were not registered under the Act. outstanding.

           In connection with the salepayment of the Subordinated Notes, we entered into an Option Agreement, dated July 31, 2001, with AMI and BEC (the "Option Agreement"). Pursuantdividends, subject to the Option Agreement,rights, if any, of preferred stock holders.  However, we granted each purchaserhave never paid a dividend and we do not anticipate paying a dividend in the foreseeable future.  Our current secured credit facility prohibits us from paying cash dividends on our common stock.  Upon any liquidation, dissolution or winding up of our business, the Subordinated Notes an irrevocable option requiring us to purchase any or all of the Note Warrants or the sharesholders of common stock issuable under the Note Warrantsare entitled to share equally in all assets available for distribution after payment of all liabilities and provision for liquidation preference of shares of preferred stock then held by the purchaser (the "Put Option").outstanding.  The Put Option may be exercised at any time commencing July 31, 2004, and ending July 31, 2008. In addition, each purchaser granted us an irrevocable option to purchase all the Note Warrants or the sharesholders of common stock issuable under the Note Warrants then held by the purchaser (the "Call Option"). The Call Option may be exercised at any time commencing July 31, 2005,have no preemptive rights and ending July 31, 2008. The purchase price under the Put Option and the Call Option is based on the quotient obtained by dividing (a) the sum of six times our consolidated EBITDA for the period of the 12 most recent consecutive months minus Net Debt plus the Warrant Proceeds by (b) the number of Diluted Shares (as the terms EBITDA, Net Debt, Warrant Proceeds, and Diluted Shares are defined in the Option Agreement).

           Pursuantno rights to the guidance under EITF 00-19 on accounting for, and financial presentation of, securities that could potentially be settled in our stock, the Put Option would be classified outside of equity, based on the ability of the holder to require cash settlement. Also, EITF Topic D-98 discusses the accounting for a security that will become redeemable at a future determinable date and its redemption is variable. This is the case with the Note Warrants as the date is fixed, but the put or call price varies. The EITF gives two possible methodologies for valuing the securities. We have selected to account for the changes in redemption value immediately as they occur, and we will adjust the carrying value of the security to equal the redemption value at the end of each reporting period. On June 30, 2002, the purchase price under the Put Option was in a negative position and, as a result, no liability was recorded for the redemption of the Put Option.

Exchange Agreement and Exchange Warrants

            On July 9, 2001, we entered into an agreement (the "Exchange Agreement") with Capital Bank to issue to Capital Bank, as agent for certain of its accredited investors, 1,893,505 shares of common stock and a warrant to purchase up to 1,839,405 shares of common stock at an exercise price of $1.75 per share (the "Exchange Warrant") in satisfaction of all amounts due or to become due under the Loan Agreement, dated August 29, 2000, between us and Capital Bank (the "$3 Million Loan") and a related Unsecured Promissory Note issued by us in favor of Capital Bank in the original principal amount of $3,000,000 (the "$3 Million Note"), including our obligations to issue to Capital Bank shares of common stock if the $3 Million Note was not paid by certain due dates. The $3 Million Note was due on July 1, 2001. This prospectus is part of a registration statement which registers for resale (a) 1,793,178 of the 1,893,505 shares issued on July 9, 2001, pursuant to the Exchange Agreement and (b) 1,741,926 of the 1,839,405 shares issuable upon the exercise of the Exchange Warrant.

             Upon the closing of the Exchange Agreement effective July 9, 2001, we paid to Capital Bank a closing fee of $325,000, payable in $75,000 cash and by issuing to Capital Bank 105,932 shares of common stock, with the number of shares being equal to the quotient of $250,000 divided by the last closing bid price of the common stock as quoted on the

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Nasdaq on June 26, 2001. In addition, for consulting services in connection with the Exchange Agreement, we issued to Herbert Strauss a five-year warrant for the purchase of up to 625,000 shares of common stock at a purchase price of $1.75 per share (the "Capital Exchange Warrant"). The terms of the Exchange Warrant and the Capital Exchange Warrant are substantively similar.

           The Exchange Warrant is exercisable at any time, from time to time, on or after July 9, 2001, and prior to July 9, 2006. If we propose to sell substantially all of our assets or merge or consolidate, or effect a merger or consolidation in which we are not the survivor, and the consideration to be received by us or our shareholders consists solely of cash, then the Exchange Warrant will terminate unless exercised by the effective date of the sale or merger transaction. If the consideration to be received by us or our shareholders consists, in whole or in part, of consideration other than cash, the holder of the Exchange Warrant will have the right thereafter to purchase the kind and amount of the shares and other securities and property which would have been owned or entitled to be received after such sale or merger transaction had the Exchange Warrant been exercised immediately prior to such transaction.

           The exercise price and the number of shares of common stock issuable upon exercise of the Exchange Warrant are subject to adjustment, from time to time, if we:

            *     subdivide our outstanding shares of common stock,

            *     combine our outstanding shares ofconvert their common stock into a smaller number of shares of common stock,any other securities.  There are no redemption or

            *     issue any shares of our capital stock in reclassification of our common stock for the number of shares 
                   of common stock issuable upon exercise of the Exchange Warrant.

Upon any such transaction, the Exchange Warrant will be adjusted so that the holder of the Exchange Warrant will be entitled sinking fund provisions applicable to receive the kind and number of shares of common stock or of our other securities which the holder would have owned or been entitled to receive had the Exchange Warrant been exercised in advance of such transaction.

            The holder of the Exchange Warrant will be entitled to purchase the number of shares of common stock or other securities, resulting from such adjustment at an exercise price per share of common stock or other security determined by:

           *      multiplying the exercise price in effect immediately prior to such adjustment by the number of shares 
                   of common stock purchasable pursuant to the Exchange Warrant immediately prior to such adjustment, 
                divided by,

        *      the number of shares of common stock or other securities resulting from such adjustment.

           The issuance of the common stock, the Exchange Warrant and the Capital Exchange Warrant under the terms of the Exchange Agreement was made pursuant to Section 4(2) and/or Rule 506 under Regulation D promulgated under the Act. Capital Bank has advised us that it is precluded by Austrian law from disclosing the identities of its investors at the time of the Exchange Agreement transaction, without the investors' permission. Asserting Austrian law, Capital Bank would not disclose to us the identities of its investors, but did represent to us that all of its investors are accredited investors under Rule 501 of Regulation D promulgated under the Act. Certain of its investors recently gave permission to Capital Bank to disclose their identities in order to be included as a Selling Stockholder in this prospectus. In addition, Capital Bank has advised the Company that none of its investors beneficially own more than 4.9% of our common stock.  See "POTENTIAL CHANGE OF CONTROL" for a discussion of Capital Bank's holdings of our securities.

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           Until the summer of 2001, Herbert Strauss was employed by Capital Bank and was the Company's relationship contact at Capital Bank. During the summer of 2001, Capital Bank undertook a series of management changes. These changes included Mr. Strauss terminating his employment at Capital Bank and becoming a consultant to Capital Bank with the obligation to fulfill certain of his prior duties. It was during this period in which Mr. Strauss assisted the Company with the exchange of debt for equity. As compensation for his assistance to the Company, Mr. Strauss was issued the Common Stock Purchase Warrant, dated July 9, 2001, for the right to purchase up to 625,000 shares of the Company's common stock at an exercise price of $1.75 per share.

            Effective January 1, 2002, the Company and Mr. Strauss entered into a Consulting Agreement in which Mr. Strauss agreed to provide certain financial advisory and consulting services with respect to European investors only. Such services include assisting the Company with the introduction to investment bankers, general business development, and market exposure in Europe. The term of this agreement is one year, but will be terminated earlier if Capital Bank advises the Company that Capital Bank does not approve of the consulting arrangement. Mr. Strauss will be paid a consulting fee of $5,000 per month during the term of the agreement.

BHC Warrants

            On January 31, 2001, we entered into a definitive loan agreement with BHC Interim Funding, L.P. ("BHC"), pursuant to which BHC loaned us $6 million (the "BHC Loan"). The BHC Loan was payable on March 31, 2002, with interest payable monthly on the outstanding principal balance of the BHC Loan at the annual rate of 13.75%. We repaid the BHC Loan in full on July 31, 2001. Pursuant to the terms of the BHC Loan, we issued to BHC certain warrants (the "BHC Warrants") for the purchase of up to 817,142 shares of common stock at an initial exercise price of $1.4578 per share. This prospect is part of the registration statement which registers for resale the 817,142 shares issuable upon the exercise of the BHC Warrants.

            The BHC Warrants allow the holder to exercise the BHC Warrant without paying the exercise price in cash. Upon a cashless exercise, the holder will receive the number of shares of common stock equal to:

            *      the number of shares as to which the BHC Warrants are being exercised, minus

            *      the number of shares having an aggregate fair market value equal to the product of (a) the exercise 
                    price multiplied by (b) the number of shares as to which the BHC Warrants are being exercised.

            The exercise price and the number of shares of common stock issuable upon exercise of the BHC Warrants are subject to adjustment, from time to time, upon the occurrence of any of the following events. If we issue shares of common stock for a price per share less than the exercise price in effect before such issuance, the exercise price will be reduced to a price determined by multiplying the exercise price by a fraction having:

          *      the numerator equal to the total number of common stock shares outstanding plus the number of 
                  shares of common stock which the aggregate consideration received by us would purchase at 
                  such exercise price; and

         *      the denominator equal to the total number of shares of common stock outstanding immediately 
                 after such issuance.

These adjustments will not be made as a result of the grant or exercise of rights or options under our existing stock purchase and stock option plans or under our warrants which were outstanding on January 1, 2001.

            If we issue options or rights to subscribe for shares of common stock, or any securities convertible into or exchangeable for shares of common stock, for a price less than the exercise price, the exercise price in effect immediately prior to such issuance will be reduced to a price computed by the above-listed method. If we subdivide, combine, or pay a dividend in shares of common stock outstanding, the exercise price and number of shares issuable upon exercise of the

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BHC Warrants will be proportionately decreased, or increased, as appropriate. If the exercise price is adjusted, the number of shares of common stock issuable upon the exercise of the BHC Warrant will be equal to:

            *      the product of: (a) the number of shares of common stock issuable upon the exercise of the BHC Warrant
                    immediately prior to such adjustment, and (b) the exercise price immediately prior to such adjustment, 
                    divided by

            *      the exercise price immediately after such adjustment.

            The exercise price and the number of shares of common stock issuable upon exercise of the BHC Warrants are subject to adjustment, from time to time, if we:

            *       reorganize or reclassify the outstanding shares of common stock;

            *       merge or consolidate with another corporation; or

            *       sell, lease or convey all, or substantially all, of our property, assets, business and goodwill to another 
                     entity.

Upon any such transaction, the BHC Warrant will be adjusted so that the holder of the BHC Warrant will be entitled to receive the kind and number of shares of common stock or of our other securities which the holder would have owned or been entitled to receive had the BHC Warrant been exercised in advance of such transaction.

             If we make a distribution of assets or securities to our stockholders, prior to the expiration of the BHC Warrant and prior to the exercise of the BHC Warrant, the holder of the BHC Warrant will be entitled, upon the exercise, to receive, in addition to the common stock it is entitled to receive, the same kind and amount of assets or securities as would have been distributed to it in a distribution had it been the holder of record of shares of common stock receivable upon exercise of the BHC Warrant on the record date for determination of those entitled to receive the distribution.

            If we dissolve, liquidate, or wind up our affairs at any time prior to the expiration or exercise of the BHC Warrant, the holder of the BHC Warrant will be entitled to receive, in lieu of our common stock, the same kind and amount of assets as would have been issued, distributed or paid to it upon the exercise of the BHC Warrant on the record date for the determination of those entitled to receive any such liquidating distribution.

            The holder of the BHC Warrants may, at any time and from time to time during the term of the BHC Warrants, request the registration of the BHC Warrant and common stock issuable upon the exercise of the BHC Warrants. Inaddition, the holder of the BHC Warrants is entitled, subject to certain conditions, to include the BHC Warrant and common stock issuable upon the exercise of the BHC Warrant in a registration statement covering other securities which the Registrant proposes to register.

National Warrants

            On December 5, 2000, we entered into a financial advisory and consulting agreement (the "Advisory and Consulting Agreement") with National Securities Corporation ("National"). Pursuant to the terms of the Advisory and Consulting Agreement, National performed various financial advisory services for the Company, including disseminating information to the investment community at large; and advising us as to the timing and structure of future offerings of equity securities. Pursuant to the terms of the Advisory and Consulting Agreement, we issued to National two warrants (collectively, the "National Warrants"), consisting of (a) a warrant, dated June 1, 2001, for the purchase of up to 250,000 shares of common stock and exercisable for a period of five years at an exercise price of $1.50 per share, and (b) a warrant, dated June 1, 2001, for the purchase of up to 360,000 shares of common stock and exercisable for a period of five years at an exercise price of $1.75 per share. On July 30, 2002, National assigned a portion of the National Warrants to various

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brokers and entities controlled by brokers of National entitling the assignees to acquire 247,000 shares of common stock at an exercise price of $1.50 per share and 340,000 shares of common stock at an exercise price of $1.75 per share.

             The terms of the National Warrants provide that the holder may exercise a National Warrant without paying the exercise price in cash. Upon a cashless exercise, the holder will receive the number of shares equal to the product of (a) the number of shares of common stock as to which the National Warrant is being exercised, multiplied by (b) a fraction, the numerator of which is the market price of our common stock minus the exercise price, and the denominator is the market price.

             If we declare and pay a dividend in common stock into a greater number of shares, or if theAll outstanding shares of common stock are subdivided, combined or consolidated, then the number of shares issuable upon the exercise of the National Warrant or the exercise price will be proportionately increased or decreased, as appropriate.

              If we merge or consolidate with another entityfully paid and we are not the surviving entity, or if we sell or convey all or substantially all of our property, the holder of a National Warrant may receive, upon its exercise, the kindnonassessable.

The terms of the National Warrants provide that the holder has certain piggyback registration rights. This prospectus is part of the registration statement which registersregistrar for resale the 610,000 shares of our common stock that are issuable upon exercise of the National Warrants.

Consultant Warrants

             We have issued an aggregate of 2,591,458 warrants to purchase common stock (collectively, the "Consultant Warrants") in connection with retaining and compensating Larkspur Capital Corporation ("Larkspur"), Ryan, Beck & Co. ("Ryan Beck"), and Strategic Growth International, Inc. ("Strategic") for consulting and advisory services rendered to us. These consulting services related to the negotiation and completion of our $22 million credit facility, the BHC Loan, and the Purchase Agreement covering our Subordinated Notes. A portion of the Consultant Warrants issued to Larkspur and Ryan Beck were assigned by Larkspur and Ryan Beck to certain officers and/or managing directors of Larkspur and Ryan Beck or trusts controlled by such officer or managing director. Except as otherwise noted below, each of these warrants are for a term of five years with an exercise price of $1.44 per share. This prospectus is part of the registration statement which registers for resale the 2,591,458 shares of our common stock that are issuable upon the exercise of the Consultant Warrants.

             In connection with retaining the services of Larkspur, Ryan Beck, and Strategic, we issued warrants to purchase an aggregate of 630,000 shares of common stock, consisting of (a) warrants issued to each of Larkspur and Ryan Beck, dated January 25, 2000, for the purchase of up to 75,000 shares and (b) warrants issued to Strategic, dated April 1, 1999, for the purchase of up to 480,000 shares. The warrants granted to Strategic are for a term of four years and have an exercise price of $1.20 per share as to 240,000 shares and $1.40 per share as to 240,000 shares.

           In connection with the negotiation and completion of our $22 million credit facility, we issued warrants for the purchase of an aggregate of 1,283,332 shares of common stock, consisting of (a) warrants issued to each of Larkspur and Ryan Beck, dated December 22, 2000, for the purchase of up to 534,722 shares, and (b) warrants issued to Strategic, dated December 22, 2000, for the purchase of up to 213,888 shares.

           In connection with the negotiation and completion of the BHC Loan, we issued warrants for the purchase of an aggregate of 349,999 shares of common stock, consisting of (a) warrants issued to each of Larkspur and Ryan Beck, dated January 31, 2001, for the purchase of up to 85,069 shares, (b) warrants issued to Strategic dated February 1, 2001, for the purchase of up to 34,028 shares, (c) warrants issued to each of Larkspur and Ryan Beck, dated March 9, 2001, for the purchase of up to 60,764 shares, and (d) warrants issued to Strategic, dated March 9, 2001, for the purchase of up to 24,305 shares.

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           In connection with the negotiation and completion of the Purchase Agreement and our Subordinated Notes, we issued warrants for the purchases of up to an aggregate of 328,127 shares of common stock consisting of (a) warrants issued to each of Larkspur and Ryan Beck, dated July 31, 2001, for the purchase of up to 136,720 shares, and (b) warrants issued to Strategic, dated July 31, 2001, for the purchase of up to 54,687 shares.

           The terms of the Consultant Warrants provide that the holder may exercise a Consultant Warrant without paying the exercise price in cash. Upon a cashless exercise, the holder will receive the number of shares equal to the product of (a) the number of warrant shares as to which the warrant is being exercised, multiplied by (b) a fraction, the numerator of which is the market price of our common stock minus the exercise price, and the denominator is the market price.

           The exercise price or number of shares issuable upon exercise of the Consultant Warrants may be proportionately increased or decreased, as appropriate, if we subdivide or combine our common stock, or pay a dividend in common stock. When the exercise price is adjusted, the number of shares issuable upon exercise will also be adjusted multiplying a number equal to the exercise price in effect immediately prior to such adjustment by the number of shares issuable upon exercise of the Consultant Warrants immediately prior to such adjustment and dividing the product by the adjusted exercise price.

          The following table sets forth as to each Selling Stockholder: (a) the name of each Selling Stockholder, (b) the amount of shares beneficially owned as of September 12, 2002, (c) the number of shares of common stock owned by each Selling Stockholder which are included under this prospectus, (d) the number of shares beneficially owned after the offering, assuming that all shares of common stock being offered hereby are sold and that such are outstanding, and (e) the percentage of common stock beneficially owned after completion of the offering. Unless otherwise noted, each Selling Stockholder has sole voting and investment power over the shares of common stock listed as beneficially owned by the Selling Stockholder.

           The common stock being offered includes shares of common stock which may be acquired upon: (a) the exercise of outstanding warrants, whether such are currently exercisable, and/or (b) conversion of outstanding shares of preferred stock, whether or not such are currently convertible.

           The percentage of common stock beneficially owned after completion of this offering assumes: (a) all shares of common stock covered by this prospectus are sold, (b) the Selling Stockholder does not acquire beneficial ownership of additional shares of common stock after the date of this prospectus, and (c) we do not issue any additional shares of common stock after the date of this prospectus, except the shares of common stock which a person has the right to acquire upon the exercise of warrants and conversion of preferred stock outstanding as of the date of this prospectus, but such shares are not determined to be outstanding for the purpose of computing the percentage ownership of any other person. The amounts indicated are based on outstanding common stock of34,298,382 shares as of September 12, 2002.

* Less than 1%.

** This Selling Stockholder is an affiliate of a registered broker-dealer.

⁽¹⁾    All of the shares indicated are issuable upon the exercise of warrants.

⁽²⁾    One-half of the shares indicated are issuable upon the exercise of warrants.

⁽³⁾    Includes 250,000 shares issuable upon the exercise of warrants and 100,000 owned of record by D.W. 
         Investments, Inc. of which Mr. Ellis is the sole stockholder.

⁽⁴⁾    Includes 571,428 shares issuable upon the exercise of warrants.

⁽⁵⁾    Includes 571,429 shares issuable upon the exercise of warrants and 15,000 issuable upon the exercise of 
        options.

⁽⁶⁾    Includes 225,000 shares issuable upon the exercise of warrants.

⁽⁷⁾    As of September 12, 2002, Capital Bank owned of record, as agent for certain accredited investors, 9,258,672 
        shares of common stock representing 27.0% of our issued and outstanding common stock. As of that date,
        Capital Bank also had the right to acquire an additional 6,025,317 shares of common stock, comprised of 
        (a) 4,358,650 shares of common stock issuable under various warrants held by Capital Bank, as agent for 
        certain investors and (b) 1,666,667 shares of common stock issuable to Capital Bank upon the conversion 
        of 2,500 shares of Series 17 Preferred held by Capital Bank, as agent for certain investors.If Capital Bank 
        were to acquire all of the shares of common stock issuable upon exercise of the various warrants held 
        by Capital Bank and the shares of common stock issuable upon conversion of the Series 17 Preferred, 
        then Capital Bank would own of record 15,283,989 shares of common stock, representing 37.9% of 
        the issued and outstanding common stock (assuming no other issuances of our common stock). 
        The Selling Stockholders identified in this table under the caption "Capital Bank-Grawe Gruppe 
        AG, as agent for the following Selling Stockholders" include 109 persons and entities which, in 
        the aggregate, beneficially own 3,143,115 shares of the common stock that are owned of record by 
        Capital Bank and 2,725,548 shares of common stock issuable upon the exercise of warrants held in 
        Capital Bank's name. The warrants held in Capital Bank's name are exercisable at exercise prices 
        ranging from $1.4219 to $1.9688 per share of common stock. Capital Bank may also acquire 
 additional shares as payment of dividends on the Seriesis Continental Stock Transfer & Trust Company 17 Preferred. None of the shares includedBattery Place, Floor 8, New York, New York 10004-1123.

            The financial statements of M&EC for the years ended December 31, 2000, and 1999 included in our definitive proxy statement, filed May 9, 2002, relating to our Special Meeting (the "Special Meeting Proxy") have been audited by Gallogly Fernandez & Riley, LLP ("GFR"), independent certified public accountants to the extent and for the periods set forth in their report incorporated herein by reference, and are incorporated by reference herein in reliance upon such report given upon the authority of said firm as experts in auditing and accounting.

           Approximately 95% and 94% of the total hours spent on the audit of our financial statements for the years ended December 31, 2000 and 2001, respectively, were spent by GFR, as a member of the BDO alliance network of firms. Members of the BDO alliance network of firms, including GFR, are not full time, permanent employees of BDO.

            The financial statements of our subsidiary, Diversified Scientific Services, Inc., included in the Special Meeting Proxy have been incorporated in reliance on the report of Arthur Andersen LLP, independent certified public accountants. We have not been able to obtain, after reasonable efforts, the written consent of Arthur Andersen LLP to the inclusion of its report in this prospectus, and we have not filed that consent in reliance on Rule 437a promulgated under the Act. Because Arthur Andersen has not consented to the inclusion of its report in this prospectus, your ability to assert claims against Arthur Andersen may be limited. In particular, because of this lack of consent, you will not be able to sue Arthur Andersen under Section 11(a)(4) of the Act for untrue statements of a material fact, if any, contained in the financial statements audited by Arthur Andersen or omissions to state a material fact, if any required to be stated in those financial statements.