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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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) August 19, 1997
KOLL REAL ESTATE GROUP, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
0-17189 02-0426634
(Commission File Number) (I.R.S. Employer Identification No.)
4343 Von Karman Avenue, Newport Beach, California 92660
(Address of principal executive offices) (Zip Code)
(714) 833-3030
(Registrant's Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address,
if Changed Since Last Report)
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Item 3. BANKRUPTCY OR RECEIVERSHIP
On August 19, 1997, the United States Bankruptcy Court for the
District of Delaware (the "Court") confirmed the Registrant's Prepackaged
Plan of Reorganization (the "Prepackaged Plan").
The Prepackaged Plan generally consists of the following transactions:
(i) the cancellation and exchange of approximately $169.0 million of Senior
Subordinated Pay-In-Kind Debentures due March 15, 2002 ("Senior Debentures")
and liquidated non-contingent claims and approximately $41.1 million of
Subordinated Pay-In-Kind Debentures due March 15, 2002 ("Subordinated
Debentures") on the basis of 56 shares of the Registrant's newly created
Common Stock ("Common Stock") for each $1,000 principal amount of Senior
Debentures or liquidated non-contingent claims and 28 shares of Common Stock
for each $1,000 principal amount of Subordinated Debentures (all after
consolidation of all outstanding shares of capital stock into a single class
of Common Stock and the reverse stock split described below); (ii) the
reclassification and combination of each share of the Company's Series A
Preferred Stock (the "Preferred Stock") and Class A Common Stock (the "Class
A Common Stock") outstanding prior to the effective date of the Prepackaged
Plan into one and three-quarter (1.75) shares and one (1) share,
respectively, of Common Stock (the "Capital Stock Combination"); (iii) the
reverse stock split of all outstanding shares of capital stock of the
Registrant on a one for one hundred (1:100) basis (the "Reverse Stock
Split"); (iv) the implementation of numerous amendments to the Registrant's
Restated Certificate of Incorporation (the "Restated Certificate") and
Amended Bylaws (the "Bylaws") to effect the Capital Stock Combination and the
Reverse Stock Split, to provide for authorized capital stock of 18 million
shares of Common Stock, to eliminate the Registrant's classified board of
directors which existed prior to the the effective date of the Prepackaged
Plan and to remove various anti-takeover provisions contained in the Restated
Certificate and Bylaws prior to the effective date of the Prepackaged Plan,
including all supermajority voting provisions, certain restrictions on
stockholders' ability to call special meetings and restrictions on
stockholders' ability to act by written consent; and (v) the reconstitution
and expansion of the Registrant's board of directors to include four
incumbent directors and six new directors, each to serve for one year terms.
There are currently approximately 48,938,507 and 38,886,590 issued and
outstanding shares of the Registrant's Class A Common Stock and Preferred
Stock, respectively. Upon completion of the Registrant's recapitalization,
there will be approximately 11.8 million shares of Common Stock outstanding,
excluding shares of Common Stock underlying certain options and warrants.
Information concerning the Registrant's assets and liabilities is set
forth in the Registrant's Registration Statement on Form S-4, as amended
(Registration Nos. 333-29883 and 333-22121) and the Registrant's Quarterly
Reports on Form 10-Q for the quarters ended March 31, 1997 and June 30, 1997,
which information is incorporated herein by reference. The Prepackaged Plan,
as confirmed by the Court, is attached as Exhibit 99.1 to the Registrant's
Current Report on Form 8-K filed July 21, 1997 and is incorporated herein by
reference.
On August 19, 1997, the Registrant issued a press release, a copy of
which is attached hereto and is incorporated herein by reference, which
describes the confirmation of the Prepackaged Plan by the Court.
Certain of the foregoing information is forward looking in its nature
and involves risks and uncertainties that could significantly impact the
ability of the Registrant to achieve its currently anticipated goals and
objectives.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits:
Exhibit No. Description
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99.01 Press Release, issued August 19, 1997.*
99.02 Prepackaged Plan of Reorganization of Koll Real
Estate Group, Inc., incorporated by reference to
Exhibit 99.1 of the Registrant's Current Report on
Form 8-K filed July 21, 1997.
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*Filed herewith.
2.
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SIGNATURES
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 thereunto duly authorized.
KOLL REAL ESTATE GROUP, INC.
Date: August 28, 1997 By /s/ Raymond J. Pacini
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Raymond J. Pacini
Executive Vice President and
Chief Financial Officer
3.
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[EXHIBIT 99.01]
[LETTERHEAD]
NEWS RELEASE
- ------------
Contact: Donald M. Koll
Chairman and Chief Executive Officer
714-833-3030 X200
KREG ANNOUNCES COURT CONFIRMATION OF PREPACKAGED PLAN
NEWPORT BEACH, Calif. -- August 19, 1997 -- Koll Real Estate Group, Inc.
(NASDAQ:KREG) announced today that its Prepackaged Plan of Reorganization,
which was filed on July 14, 1997, has been confirmed by the U.S. Bankruptcy
Court for the District of Delaware.
Under the confirmed plan, the Company will exchange approximately $210
million of outstanding debentures and noncontingent claims for common stock
on or about September 2, 1997. Once completed, all corporate debt will be
eliminated, resulting in a pro forma net worth of approximately $140 million
as of June 30, 1997, and the preservation of approximately $200 million of
tax loss carryforwards.
"We are pleased to have obtained confirmation of our recapitalization
plan within only 36 days of filing with the court," said Donald M. Koll, KREG
chairman and CEO. "I am very optimistic about the future of the Company with
its strong balance sheet, favorable tax position, absence of corporate debt
and dominant position in strong domestic and Asian real estate markets."
Koll Real Estate Group, Inc. provides residential and commercial real
estate development services on a national and international basis. The
Company's largest single asset, Bolsa Chica in Orange County, California, is
progressing toward groundbreaking for a new master-planned residential
community in 1998. In addition, the Company currently has 30 commercial
projects under development in the United States and Asia totaling
approximately 12 million square feet and $1.2 billion in construction costs.
**MORE**
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August 19, 1997 Page 2
Any forward-looking statements in this press release involve risks and
uncertainties. The Company's actual results could differ materially from
those currently anticipated in any such forward-looking statements because of
many factors.
**END**
EDITOR'S NOTE: Please do not confuse the four separately owned and
operated companies which carry the Koll name. Koll Real Estate Group, Inc. is
a publicly-owned development and development services company with operations
in the United States and Asia. Koll Real Estate Services, which has agreed to
merge with CB Commercial Real Estate Services Group Inc., is one of the
nation's largest real estate services companies, providing property,
facilities and asset management to clients throughout the United States and
Asia. Koll Construction, is one of the country's largest multi-service
construction firms. Koll Resorts International is a leading developer of
resort communities in Mexico and provides management services to resort
developments in Mexico and the United States.
