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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
December 3, 1995
GREINER ENGINEERING, INC.
(Exact name of registrant as specified in its charter)
1-7567 95-1799320
(Commission File Number) (I.R.S. Employer
Identification Number)
Nevada
(State or other jurisdiction of incorporation)
909 East Las Colinas Boulevard, Suite 1900
Irving, Texas 75039
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code:
(214) 869-1001
Page 1 of 17 sequentially numbered pages. Index to exhibits is on page
number 4.
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Item 5. Other Events.
On December 3, 1995, URS Corporation ("URS") and
Greiner Engineering, Inc. ("Greiner") executed a letter of intent for URS to
acquire all the outstanding stock of Greiner pursuant to a merger of Greiner
with a wholly-owned subsidiary of URS (the "Acquisition"). The Acquisition
price will consist of $13.50 in cash plus 0.298 shares of URS common stock for
each of the 4,698,442 outstanding shares of Greiner common stock, for an
aggregate Acquisition price of $63,428,467 and 1.4 million shares of URS common
stock.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits
(c) The following exhibits are furnished in accordance
with the provisions of Item 601 of Regulation S-K:
<TABLE>
<CAPTION>
Exhibit Number Exhibit
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<S> <C>
2(a) Letter of Intent and Transaction Term
Sheet dated December 2, 1995
20(a) Press Release issued December 4, 1995
</TABLE>
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SIGNATURE
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.
Dated: December 6, 1995
GREINER ENGINEERING, INC.
By: /s/ Patrick J. McColpin
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Patrick J. McColpin
Vice President and
Chief Financial Officer
(Principal Accounting Officer)
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INDEX TO EXHIBITS
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<TABLE>
<CAPTION>
Exhibit Sequentially
Number Exhibit Numbered Page
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<S> <C> <C>
2(a) Letter of Intent and 5
Transaction Term Sheet dated
December 2, 1995
20(a) Press Release issued 14
December 4, 1995
</TABLE>
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Exhibit 2(a)
URS Corporation 100 California Street, Suite 500
San Francisco, CA 94111-4529
Tel: (415) 774-2700
Fax: (415) 398-1505
Martin M. Koffel
Chairman and
Chief Executive Officer
December 2, 1995
HMF-56393
Mr. Robert L. Costello
President and Chief Executive Officer
Greiner Engineering, Inc.
Suite 1900, LB 44
909 E. Las Colinas Blvd.
Irving Texas 75039-3907
Re: Acquisition of Greiner Engineering, Inc.
by URS Corporation
Dear Rob:
I am very pleased that the Board of Directors of Greiner
Engineering, Inc. has agreed with us that the combination of Greiner with URS
Corporation on the terms proposed is an excellent strategic and financial
opportunity for the shareholders, employees and clients of both our companies.
The attached Transaction Term Sheet is intended to summarize
the nonbinding understandings of the parties with respect to the terms and
conditions of the combination, as well as certain binding agreements between
the parties regarding their relationships while the transaction is being
finalized. If you agree that the Transaction Term Sheet accurately summarizes
our mutual intent and sets forth our agreements as of the date of this letter,
please so indicate by countersigning this letter.
Once this letter has been countersigned, the next phase will
be to finalize an appropriate definitive agreement, to prepare the required
regulatory filings, and to commence the other steps that will be necessary or
appropriate to complete the transaction.
I also am enclosing a copy of the joint press release in the
form we previously agreed upon. As discussed, we are planning to issue this
release prior to the opening of the stock market in New York on Monday,
December 4, assuming that you have countersigned this letter by that time.
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We look forward to working with you toward a prompt and
successful conclusion to this transaction, and to a bright future for our
combined companies.
Sincerely,
/s/ Martin M. Koffel
AGREED AND CONFIRMED
GREINER ENGINEERING, INC.
By /s/ Robert L. Costello
-------------------------------------
Robert L. Costello
President and Chief Executive Officer
Date: December 3, 1995
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TRANSACTION TERM SHEET
PART 1. NONBINDING UNDERSTANDINGS:
STRUCTURE * URS Corporation ("URS") will acquire all
the outstanding stock of Greiner
Engineering, Inc. ("Greiner") pursuant
to a merger of Greiner with a
wholly-owned subsidiary of URS (the
"Acquisition").
* The Acquisition price will consist of
$13.50 in cash plus 0.298 shares of URS
common stock for each of the 4,698,442
outstanding shares of Greiner common
stock, for an aggregate Acquisition
price of $63,428,467 and 1.4 million
shares of URS common stock.
* Fractional shares otherwise issuable
will be settled for cash based on the
market price of URS common stock as of
the closing of the Acquisition (the
"Closing").
* All outstanding options and other rights
to acquire Greiner common stock will be
cancelled at the Closing. Any such
vested options or other rights which are
in-the-money at the Closing will be
settled for cash in an amount per share
equal to the difference between the
exercise price and the sum of $13.50
plus the market price of 0.298 shares of
URS common stock as of the Closing.
DUE DILIGENCE * URS will immediately proceed with its
operational, financial and legal due
diligence investigation of Greiner.
Such investigation will be completed
prior to the execution of the Definitive
Agreement so that the Agreement (see
below) will contain no due diligence
condition. Execution of the Definitive
Agreement will be subject to completion
of the due diligence investigation to
the satisfaction of URS and its lenders.
URS will deliver to Greiner for its
review such public information
(financial and other) not currently in
Greiner's possession as Greiner may
request to facilitate Greiner's review
of the business and financial condition
of URS.
DEFINITIVE
AGREEMENT * URS and Greiner will promptly begin
negotiations toward a definitive
agreement containing the terms and
conditions summarized elsewhere in this
Term Sheet and other agreements,
representations, warranties
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and conditions appropriate for
transactions of this nature (the
"Definitive Agreement"). URS and its
counsel will be responsible for preparing
the initial draft of the Definitive
Agreement, and the parties intend to
finalize and execute the Definitive
Agreement as quickly as possible.
However, the Definitive Agreement will
not be executed until the due diligence
investigation has been completed to the
satisfaction of URS and its lenders, and
URS and Greiner are satisfied with the
commitments of URS's lenders to fund the
cash portion of the Acquisition price.
PRINCIPAL
CONDITIONS * Principal conditions to Closing to be
specified in the Definitive Agreement will
include, among other things:
- Greiner shareholder approval;
- Receipt upon signing the Definitive
Agreement by Greiner of an opinion
of a reputable investment banking
or valuation firm, selected by
Greiner and reasonably acceptable
to URS, that the Acquisition price
is fair to Greiner and its
shareholders from a financial point
of view.
- Completion of all required filings
and receipt of all required
regulatory and other approvals
(including without limitation
filings under the Hart-Scott-
Rodino Antitrust Improvements Act
(the H-S-R Act"), registration of
the URS shares to be issued in the
Acquisition with the Securities and
Exchange Commission, and listing of
such shares on the New York and
Pacific Stock Exchanges);
- The absence of any material adverse
change in the business, financial
condition or prospects of Greiner
between September 30, 1995 and the
Closing, except as otherwise
publicly disclosed by Greiner as of
December 1, 1995;
- The absence of any pending or
threatened litigation regarding the
Definitive Agreement or the
Acquisition; and
- Such other conditions as may be
imposed by URS's lenders as
conditions to their financing
commitments.
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PART 2. BINDING AGREEMENTS:
BINDING
PROVISIONS * Upon mutual acceptance of this Transaction Term
Sheet by URS and Greiner, the paragraphs contained
in this PART II - BINDING PROVISIONS
(collectively, the "Binding Provisions") will
constitute the legally binding and enforceable
agreements of URS and Greiner (in recognition of
the significant costs to be borne by each of the
parties in pursuing this proposed Acquisition and
further in consideration of their mutual
undertakings as to the matters described herein).
NONBINDING
PROVISIONS * The paragraphs contained in PART I - NONBINDING
PROVISION above (collectively, the "NonBinding
Provisions") do not create or constitute any
legally binding obligations between Greiner, URS
or any of their respective directors, officers or
affiliates, and no such party shall have any
liability to any of the other parties with respect
to the Nonbinding Provisions until the Definitive
Agreement, if one is successfully negotiated, is
executed and delivered by URS and Greiner. No
prior or subsequent course of conduct or dealing
among the parties, oral communications or other
actions not reduced to or reflected in a writing
executed by all of the parties shall serve to
modify this paragraph in any way or cause the
Nonbinding Provisions or any provisions covering
the same subject matter to become in any sense
legally binding and enforceable. If the
Definitive Agreement is not prepared, authorized,
executed or delivered for any reason, no party
shall have any liability to any other party based
upon, arising from, or relating to the Nonbinding
Provisions.
NO-SHOP * For the next 120 days, or if longer so long as
negotiations toward the Definitive Agreement are
proceeding, Greiner and its directors, officers,
affiliates and other representatives agree not to,
directly or indirectly, solicit, initiate,
respond to, entertain, encourage submission of
proposals or offers, provide information, or enter
into negotiations or discussing with or in any
manner encourage, discuss, accept or consider any
proposal or offer of any person other than URS,
relating to the acquisition of all or any
substantial part of the assets, business or
capital stock of Greiner; provided that, nothing
herein shall prevent Greiner or its
directors and officers from responding to
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and considering unsolicited firm offers for any
such transaction from persons other than URS if
and to the extent that, in the written opinion of
Greiner's outside counsel, failure to do so would
be reasonably likely to constitute a violation of
applicable law or a breach of the fiduciary
duties of Greiner's directors to Greiner's
stockholders.
* Greiner confirms that it is not currently
conducting any active discussions or negotiations
regarding any such transaction involving Greiner
with any party except URS.
* Greiner will immediately inform URS in writing if
Greiner receives an unsolicited inquiry or
proposal regarding any such transaction, and will
immediately advise URS in writing of the terms and
other details of any such inquiry or proposal.
* If Greiner or any of its directors, officers or
affiliates enter into any such negotiations or
discussions in breach of the above no-shop
provisions, URS shall be entitled to immediate
reimbursement from Greiner for all expenses
incurred in connection with the Acquisition.
* If Greiner or any of its directors, officers or
affiliates enters into any letter of intent,
understanding or other agreement with a party
other than URS relating to the acquisition of all
or any substantial part of the assets, business or
capital stock of Greiner (whether through
purchase, merger, consolidation, exchange or any
other business combination), either in breach of
the above no-shop provisions or within 9 months
after termination of negotiations between Greiner
and URS, then immediately upon entering into such
letter of intent, understanding or other agreement
Greiner shall pay URS a termination fee of $5.0
million; provided that, no such fee shall be
payable if, prior to the entry by Greiner into
such letter of intent, understanding or other
agreement, URS has unilaterally terminated its
discussions with Greiner contemplated by this
Transaction Term Sheet or unilaterally declined to
close the acquisition as contemplated by the
Definitive Agreement.
* The expense reimbursement obligation and
termination fee described above shall not be
the exclusive remedies to URS in the event of a
breach by Greiner of the Binding Provisions of
this Transaction Term Sheet, and in any such
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event, URS shall be entitled, in addition to
receiving such payments, to equitable remedies,
including but not limited to specific performance
and enjoining any actions determined to be in
breach of the Binding Provisions.
DEFINITIVE
AGREEMENT * URS and its counsel will be responsible for
preparing the initial draft of the Definitive
Agreement. Subject to the final sentence of
the following paragraph, URS and Greiner
shall negotiate in good faith to arrive at a
mutually acceptable Definitive Agreement for
approval, execution and delivery on the
earliest possible date.
ACCESS * Greiner will provide URS and its
advisors with complete access in a timely
fashion to the facilities, contracts, books
and records of Greiner, and will cause the
officers, employees, accountants and other
representatives of Greiner to cooperate fully
with URS and its advisors in connection with
the due diligence investigation of Greiner.
URS will be under no obligation to continue
with its due diligence investigation or
negotiations regarding the Definitive
Agreement if, at any time, the results of its
due diligence investigation are not
satisfactory to URS for any reason in its
sole discretion.
CONDUCT OF
BUSINESS * Until the Definitive Agreement
has been duly executed and delivered by all of
the parties or the Binding Provisions have
been terminated as provided below, Greiner
shall conduct its business only in the
ordinary course, and shall not engage in any
extraordinary transactions without the prior
written consent of URS, including, without
limitation, the following:
- disposing of any assets of Target
Company, except in the ordinary
course of business;
- materially increasing the annual
level of compensation of any
employee, or increasing at all the
annual level of compensation of any
person whose compensation from
Greiner in the last fiscal year
exceeded $150,000, or granting any
unusual or extraordinary bonuses,
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benefits or other forms of direct or
indirect compensation to any
employee, officer, director or
consultant, except in amounts in
keeping with past
practices;
- issuing any equity securities or
options, warrants, rights or
convertible securities;
- paying any dividends in excess of
the regular dividend payment of
$0.075 per quarter, redeeming any
securities, or otherwise causing
assets of Greiner to be distributed
to any of its shareholders; or
- borrowing any funds under existing
credit lines or otherwise, except
as reasonably necessary for the
ordinary operation of the business
of Greiner in a manner, and in
amounts, in keeping with historical
practices.
DISCLOSURE * Except as and to the extent required by law,
without the prior written consent of the other
party, neither URS nor Greiner shall, and each
shall direct its directors, officers, affiliates
or other representatives not to, directly or
indirectly, make any public comment, statement or
communication with respect to, or otherwise
disclose or permit the disclosure of the existence
of discussions regarding, a possible transaction
among the parties or any of the terms, conditions
or other aspects of the Acquisition. URS and
Greiner have agreed to issue a joint press release
at the time this Transaction Term Sheet has been
mutually accepted, and shall cooperate to develop
and mutually agree upon an appropriate
communication program as soon as possible.
CONFIDENTIALITY * Except as and to the extent required by law,
neither URS nor Greiner shall disclose or use, and
they each shall cause their respective officers,
directors, affiliates, professional advisors and
other representatives not to disclose or use, any
Confidential Information (as defined below) with
respect to any other party furnished or to be
furnished by any other party or their respective
representatives in connection with the transactions
contemplated by this Transaction Term Sheet at any
time or in any manner other than in connection with
the evaluation of the Acquisition. For purposes of
this paragraph, "Confidential Information" means
any information about any party stamped
"confidential" or identified as such to any
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other party; provided that it does not include
information which any party can demonstrate (i) is
generally available to or known by the public other
than as a result of improper disclosure by a party
to this Transaction Term Sheet, or (ii) is obtained
by URS or Greiner from a source other than by the
other party provided that such source was not bound
by a duty of confidentiality with respect to such
information. If the Binding Provisions are
terminated as provided below, each party shall
return any Confidential Information in such party's
possession pertaining to the other party. The
parties may agree to evidence their
confidentiality obligations in a separate expanded
agreement.
COSTS * Each party shall be responsible for and bear
all of its own costs and expenses (including the
fees and expenses of its own professional advisors
and any broker's or finder's fees) incurred in
connection with the transactions contemplated by
this Transaction Term Sheet.
CONSENTS * URS and Greiner shall cooperate with each other
and proceed, as promptly as is reasonably
practical, to prepare and file the notifications
required by the H-S-R Act and the proxy and
registration statements and other filings required
under applicable securities laws, and to obtain
all necessary consents and approvals from third
parties, and to endeavor to comply with all other
legal or contractual requirements for or
preconditions to the execution and consummation of
the Definitive Agreement.
TERMINATION * The Binding Provisions may be terminated:
- by mutual written consent of the
parties; or
- upon written notice by any party to
all of the other parties if the
Definitive Agreement has not been
executed by April 1, 1996;
provided, however, that the termination of the
Binding Provisions shall not affect the liability
of a party for breach of any of the Binding
Provisions prior to termination. Upon termination
of the Binding Provisions, the parties shall have
no further obligations hereunder, except as
stated in the paragraphs captioned "No-Shop,"
"Disclosure," "Confidentiality," and "Costs."
which shall survive any such termination.
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Exhibit 20(a)
GREINER ENGINEERING, INC. NEWS RELEASE
For Immediate Release
Date: December 4, 1995
Contact: Robert L. Costello, President and Chief Executive Officer
Phone: (214) 869-1001
URS CORPORATION TO ACQUIRE GREINER ENGINEERING, INC.
(San Francisco, CA and Irving, TX). URS Corporation (NYSE:URS) and
Greiner Engineering, Inc. (NYSE:GII) today jointly announced that they have
signed a letter of intent for URS to acquire all of the outstanding shares of
Greiner's common stock. The proposed combination will result in the 20th
largest design engineering company and the fifth largest transportation
engineering firm in the nation. The acquisition is not expected to have a
material impact on URS FY1996 earnings per share.
As a result of the proposed acquisition, Greiner will become a wholly
owned subsidiary of URS. Terms of the letter of intent call for Greiner
stockholders to receive $13.50 per share in cash plus an aggregate of 1.4
million shares of URS common stock. Based on Greiner's 4,698,442 outstanding
shares of common stock, each Greiner stockholder will receive .298 share of URS
common stock for every common share of Greiner. Based on the price of URS
stock on Friday, December 1, the proposed acquisition's total value per share
to Greiner stockholders is approximately $15.50. The transaction is subject to
various conditions,
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including negotiation of a definitive agreement, due diligence and standard
regulatory, stockholder and other approvals.
"The strategic benefits of this proposed acquisition are compelling,"
stated Martin M. Koffel, Chairman and Chief Executive Officer of URS. "Greiner
has a world-class engineering reputation, and we are pleased this talented
group of professionals is joining URS. Our combined revenue will exceed $330
million, increasing our opportunities to serve as a prime contractor on larger
and more diverse projects. There is little geographic overlap of the two
organizations, and our respective services are highly complementary. Rob
Costello, Greiner's CEO, will lead the Greiner division and join the URS Board
of Directors. As a result, we anticipate excellent opportunities for
cross-marketing and significant expansion of the revenue base of the combined
enterprise. The combination will also provide a platform for increased
penetration into international markets."
"While our proposed offer represents a premium of approximately 70%
over the current market price of Greiner shares, we believe the value of
Greiner's contribution to the combined enterprise, as well as the expected cost
savings from integrating the two companies' systems and administrative
overheads, provide the opportunity to significantly enhance long-term returns
to URS shareholders," Mr. Koffel added.
Robert L. Costello, President and Chief Executive Officer of Greiner,
commented, "We believe the proposed transaction provides an excellent
opportunity for Greiner's stockholders, employees, and clients. The
combination allows our two companies to participate in the industry's current
consolidation trend to our mutual benefit. By joining URS we create a stronger
organization that has the potential to generate growth rates that we could not
have achieved as separate operations."
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For the most recent fiscal year ended October 31, 1994, URS reported
revenue of $164 million and earnings per share of $.60. For the first nine
months of fiscal year 1995, URS reported revenue of $129.6 million, a nine
percent increase over the first nine months of fiscal year 1994. Earnings per
share for the first nine months of fiscal year 1995 were $.44, compared to $.37
in 1994.
Greiner reported revenue of $151.9 million and earnings per share of
$.82 for the year ended December 31, 1994. For the nine months ended September
30, 1995, Greiner reported revenue of $117 million and a loss of $3.4 million,
or $.72 per share. The 1995 third-quarter results for Greiner included certain
restructuring charges amounting to $3.1 million associated with the company's
strategy to 1) de-emphasize local residential land development services in
California, and 2) to shift its primary focus for Asian operations from Hong
Kong to Kuala Lumpur, Malaysia. In addition, Greiner incurred a non-cash
charge of $2.3 million associated with the reduction in carrying value of its
investment in NTA (a partnership with The Perot Group established to develop
privatized transportation facilities such as toll roads). In its recent
quarterly earnings release, Greiner stated that its overall financial condition
remained strong and that its current backlog position is at a record high
level.
Headquartered in San Francisco, URS offers a broad range of services to
public and private sector clients in two principal markets: infrastructure
projects involving transportation systems, institutional and commercial
facilities, and water resources; and environmental projects involving hazardous
waste management and pollution control.
Headquartered in Irving, Texas, Greiner is a professional services firm
operating in the engineering and architectural design services industry. The
company provides engineering, planning, architectural, environmental, program
management, and other services to public and
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private sector clients throughout the U.S. and in foreign countries, including
Malaysia and Hong Kong.
###
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