<PAGE> 1
SCHEDULE 14A INFORMATION
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
FILED BY THE REGISTRANT /X/ FILED BY A PARTY OTHER THAN THE REGISTRANT / /
- --------------------------------------------------------------------------------
Check the appropriate box:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
/ / Confidential, For Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
GZA GEOENVIRONMENTAL TECHNOLOGIES, INC.
(Name of Registrant as Specified In Its Charter)
Not Applicable
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement no.:
3) Filing Party:
4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE> 2
GZA GEOENVIRONMENTAL TECHNOLOGIES, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
JULY 14, 1998
Notice is hereby given that the Annual Meeting of Stockholders of GZA
GeoEnvironmental Technologies, Inc., a Delaware corporation (the "Company"),
will be held on Tuesday, July 14, 1998 at 10 A.M., Eastern daylight savings
time, at the Sheraton Needham Hotel, 100 Cabot Street, Needham, Massachusetts
(the "Meeting"), for the purpose of considering and voting upon the following
matters:
1. To elect three persons to the Board of Directors, each to serve as a
Class I director for a three-year term;
2. To ratify the appointment of Coopers & Lybrand L.L.P. as the Company's
independent public accountants for the fiscal year ending February 28,
1999; and
3. To transact such further business as may properly come before the
Meeting or any adjournment thereof.
As of the date of this Notice, the Board of Directors has no knowledge of
any other business to be transacted at the Meeting.
The Board of Directors has fixed the close of business on Friday, May 22,
1998 as the record date for the Meeting for the determination of stockholders
entitled to notice of and to vote at the Meeting and at any adjournments
thereof.
By Order of the Board of Directors,
RICHARD M. SIMON
Secretary
June 15, 1998
Newton Upper Falls, Massachusetts
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE PROMPTLY COMPLETE,
DATE, SIGN AND RETURN THE ENCLOSED PROXY IN THE ACCOMPANYING ENVELOPE.
IF MORE THAN ONE PROXY IS ENCLOSED, PLEASE COMPLETE AND RETURN ALL OF THEM.
<PAGE> 3
GZA GEOENVIRONMENTAL TECHNOLOGIES, INC.
320 NEEDHAM STREET
NEWTON UPPER FALLS, MASSACHUSETTS 02464
PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JULY 14, 1998
This Proxy Statement and the enclosed Notice of Meeting and form of proxy
are being mailed to stockholders on or about June 15, 1998 in connection with
the solicitation of proxies by the Board of Directors of GZA GeoEnvironmental
Technologies, Inc. (the "Company") for use at the Annual Meeting of the Company,
to be held at the Sheraton Needham Hotel, 100 Cabot Street, Needham,
Massachusetts at 10 A.M., Eastern daylight savings time, on Tuesday, July 14,
1998, and at any and all adjournments thereof (the "Meeting").
On May 22, 1998, the record date for the determination of stockholders
entitled to notice of and to vote at the Meeting, there were outstanding and
entitled to vote 4,066,968 shares of the Company's common stock, $.01 par value
("Common Stock"). Each share of Common Stock entitles its record holder to one
vote on each matter considered at the Meeting.
Reference to the Company in this Proxy Statement shall include, unless the
context does not permit, the Company and its direct and indirect subsidiaries,
including, without limitation, GZA GeoEnvironmental, Inc. ("GZA GeoEnviron-
mental"), GZA Remediation, Inc. ("GZA Remediation") and GZA Drilling, Inc. ("GZA
Drilling").
PROXIES
Each copy of this Proxy Statement is accompanied by a form of proxy that is
being solicited by the Board of Directors of the Company. You are requested to
complete, sign, date and promptly return the accompanying form of proxy in the
enclosed envelope. Shares of Common Stock represented by properly executed
proxies received by the Company and not revoked will be voted at the 1998 Annual
Meeting in accordance with the instructions therein.
Proxies that have been properly executed and returned by a stockholder will
be voted in accordance with the stockholder's directions. If no choice is
specified by the stockholder, then the shares covered by the proxy will be voted
in the following manner, as recommended by management: FOR the election of Rose
Ann Giordano, Donald T. Goldberg and Thomas W. Philbin as the Class I directors
of the Company; and FOR ratifying the appointment of Coopers & Lybrand L.L.P. as
the Company's auditors for the 1999 fiscal year.
Stockholders are encouraged to vote on the matters to be considered. Any
proxy signed and returned by a stockholder may be revoked at any time before it
is voted. A stockholder may revoke the proxy by (i) notifying the Company's
Secretary in writing, (ii) signing and duly delivering a proxy bearing a later
date or (iii) attending the Annual Meeting and voting in person. The Company's
principal executive offices are located at 320 Needham Street, Newton Upper
Falls, Massachusetts 02464.
QUORUM AND TABULATION OF VOTES
Under the Company's Amended and Restated By-Laws, the holders of a majority
of the shares of Common Stock issued, outstanding and entitled to vote at the
Meeting will constitute a quorum for the transaction of business at the Meeting.
Shares of Common Stock present in person or represented by proxy (including
shares that abstain or do not vote with respect to the matter presented for
stockholder approval)
<PAGE> 4
will be counted for the purpose of determining whether a quorum exists at the
Meeting. Holders of Common Stock are entitled to one vote for each share held on
each matter submitted to a vote.
The affirmative vote of the holders of a plurality of the shares of Common
Stock properly cast at the Meeting is required to elect each nominee for
election as a director.
The following shares will not be counted as votes cast in favor of a given
matter: (i) shares that abstain from voting as to such matter; and (ii) shares
held in "street name" by brokers or nominees who indicate on their proxies that
they do not have discretionary authority to vote such shares as to such matter.
Each matter will be tabulated separately.
Votes will be tabulated by the Company's transfer agent and registrar,
American Stock Transfer & Trust Company.
PROPOSAL ONE: ELECTION OF DIRECTORS
The Company has a classified Board of Directors consisting of Class I,
Class II and Class III directors who serve three-year terms, with the term of
one of the three classes expiring each year, concurrently with the Company's
Annual Meeting. Currently, the number of directors constituting the full Board
of Directors of the Company is ten, consisting of three Class I directors, four
Class II directors, and three Class III directors.
The term of Donald T. Goldberg, Thomas W. Philbin and Irvine G. Reinig II,
the Company's current Class I directors, expires immediately following the 1998
Annual Meeting. Mr. Reinig resigned from the Company's Board of Directors
effective as of May 1, 1998. The Board has nominated Messrs. Goldberg and
Philbin for reelection as Class I directors and has nominated Rose Ann Giordano
for election as a Class I director. If elected, the terms of Messrs. Goldberg
and Philbin and Ms. Giordano will expire in 2001.
The term of the Company's Class II directors, M. Joseph Celi, Lewis
Mandell, Andrew P. Pajak and William E. Hadge, expires in 2000. The term of the
Company's current Class III directors, Timothy W. Devitt, Joseph D. Guertin and
David B. Perini, expires in 1999. Paul F. Gorman, who had served as a director
of the Company since 1991, resigned from the Company's Board of Directors
effective as of September 12, 1997. Mr. Gorman was a Class III Director of the
Company. On May 1, 1998, the Board of Directors appointed David B. Perini as a
Class III director to fill the vacancy created by the resignation of Mr. Gorman.
Unless marked otherwise, returned proxies will be voted to elect each of
Ms. Giordano and Messrs. Goldberg and Philbin as the Class I directors. Each of
Ms. Giordano and Messrs. Goldberg and Philbin have agreed to serve if elected,
and the Company has no reason to believe that any of them will be unable to
serve. If any of Ms. Giordano or Messrs. Goldberg or Philbin is unable or
declines to serve as a director at the time of the Meeting, then the Board will
designate another nominee and proxies will be voted in favor of such nominee.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE PROPOSAL
TO ELECT MS. GIORDANO AND MESSRS. GOLDBERG AND PHILBIN AS THE CLASS I DIRECTORS
OF THE COMPANY.
2
<PAGE> 5
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information concerning each director
of the Company continuing in office, each nominee for election as director, and
each executive officer of the Company, including information regarding executive
offices held by such persons with the Company's operating subsidiaries.
<TABLE>
<CAPTION>
NAME OF INDIVIDUAL AGE PRINCIPAL POSITION
- ------------------ --- ------------------
<S> <C> <C>
Donald T. Goldberg(1)(2)............. 69 Chairman of the Board of Directors
Andrew P. Pajak...................... 48 Director, President and Chief Executive Officer of the
Company; President of GZA GeoEnvironmental
M. Joseph Celi....................... 64 Director and Executive Vice President -- Remediation
Services of the Company; Executive Vice President --
Remediation Services of GZA GeoEnvironmental; President of
GZA Drilling
Richard M. Simon..................... 52 Executive Vice President -- Professional Practice of the
Company; Executive Vice President -- Professional Practice
of GZA GeoEnvironmental
John E. Ayres........................ 61 Executive Vice President -- Business Development of the
Company; Executive Vice President -- Business Development
of GZA GeoEnvironmental
Joseph D. Guertin, Jr. .............. 56 Director of the Company; Senior Vice President of GZA
GeoEnvironmental
William E. Hadge..................... 42 Director of the Company; Senior Vice President of GZA
GeoEnvironmental
Joseph P. Hehir...................... 53 Executive Vice President, Chief Financial Officer and
Treasurer of the Company
Lewis Mandell(1)..................... 55 Director of the Company
Thomas W. Philbin(1)................. 58 Director of the Company
Thomas W. Devitt(2).................. 53 Director of the Company
David B. Perini...................... 61 Director of the Company
Rose Ann Giordano.................... 59 Nominee for Director of the Company
</TABLE>
- ---------------
(1) Member of the Audit Committee.
(2) Member of the Compensation Committee.
Donald T. Goldberg has served as the Chairman of the Company's Board of
Directors since 1989. Mr. Goldberg also served as the Chief Executive Officer of
the Company from 1989 to 1995, and as President of GZA GeoEnvironmental from
1966 to 1990 and from 1992 to 1993.
Andrew P. Pajak has been Chief Executive Officer and President of the
Company and President of GZA GeoEnvironmental since August 1996. Mr. Pajak has
been a director of the Company since September 1996. Mr. Pajak was Executive
Vice President of Michael Baker Corporation, an engineering, construction and
operations and maintenance services firm, from 1994 to 1996, and President and
Chief Executive Officer of Baker Environmental, Inc., a wholly-owned subsidiary
of Michael Baker Corporation, from 1990 to 1996.
M. Joseph Celi has been a director of the Company since 1991. In 1997 Mr.
Celi was appointed to the position of Regional Operating Officer, Great Lakes
and Southern Regions of the Company. Mr. Celi also is responsible for the
Company's Brownfields development effort. In 1996 Mr. Celi was also appointed to
the positions of Executive Vice President of the Company and President of GZA
Drilling.
Richard M. Simon has been Executive Vice President -- Professional Practice
of the Company since 1995 and Executive Vice President -- Professional Practice
of GZA GeoEnvironmental since 1992.
3
<PAGE> 6
Dr. Simon was a director of the Company from 1989 to 1993, and a Senior Vice
President of GZA GeoEnvironmental from 1986 to 1992. Dr. Simon also served as
Central New England Regional Manager of GZA GeoEnvironmental from 1990 to 1993.
John E. Ayres has been Executive Vice President -- Business Development of
the Company and Executive Vice President -- Business Development of GZA
GeoEnvironmental since 1992. Mr. Ayres was a director of the Company from 1979
to 1992 and President of GZA GeoEnvironmental from 1989 to 1992.
Joseph D. Guertin, Jr. has been a director of the Company since 1996 and
has been Senior Vice President of GZA GeoEnvironmental since 1990. Mr. Guertin
also was a director of the Company from 1989 to 1991. Mr. Guertin joined the
Company in 1976.
William E. Hadge has been a director of the Company since July 1997. Mr.
Hadge joined the Company in 1979 and has served as a Senior Vice President of
GZA GeoEnvironmental since 1993.
Joseph P. Hehir has been the Chief Financial Officer of and Treasurer of
the Company since 1993 and an Executive Vice President of the Company since
1998. Mr. Hehir has been Treasurer of GZA GeoEnvironmental since 1988 and was a
Senior Vice President of GZA GeoEnvironmental from 1990 to 1995.
Lewis Mandell has been a director of the Company since 1991. Dr. Mandell
has been Dean of the Business School of, and a professor of finance at,
Marquette University since 1995. Dr. Mandell was Associate Dean of the Business
School of, and a professor of finance at, the University of Connecticut from
1980 to 1995. He also serves as a director of the Variable Annuities of
Traveler's Corporation.
Thomas W. Philbin has been a director of the Company since 1993. Dr.
Philbin has been the President and a director of HEC, Inc., an energy
conservation consulting firm, since 1991. Dr. Philbin was the Executive Director
of Brown, Rudnick, Freed & Gesmer, a Boston law firm, from 1988 to 1990. Dr.
Philbin was President of CompuChem Laboratories, Inc., an analytical laboratory
specializing in forensic and environmental analysis, from 1987 to 1988.
Timothy W. Devitt has been a director of the Company since 1993. Mr. Devitt
has been Managing Director of Putnam, Hayes & Bartlett, Inc., an economic and
management consulting firm, since 1990 and a Principal of that firm since 1987.
Rose Ann Giordano has been nominated for election as a director of the
Company. If elected, Ms. Giordano will replace Irvine G. Reinig II upon
expiration of Mr. Reinig's three-year term as a Class I director. Ms. Giordano
has been Vice President, Internet Service Provider Business Group of Digital
Equipment Corporation, since July 1997. Ms. Giordano also served as Vice
President, Internet Business Group of Digital Equipment Corporation from 1994 to
1997 and as Vice President, Middleware Software of Digital Equipment Corporation
from 1993 to 1994.
David B. Perini has been a director of the Company since May 1998. Mr.
Perini has been a director and Chairman of Perini Corporation, a general
contracting services firm, since 1972. Mr. Perini served as President and Chief
Executive Officer of Perini Corporation from 1972 until 1998, and also has
served as Vice President and General Counsel of Perini Corporation. Mr. Perini
also serves as a director of State Street Boston Corporation.
4
<PAGE> 7
BOARD AND COMMITTEE MEETINGS
During the fiscal year ended February 28, 1998 ("fiscal 1998"), the Board
of Directors of the Company met seven times. No director attended fewer than 75
percent of the meeting of the Board of Directors and of the committees on which
he served.
The Board of Directors has an Audit Committee, which confers with the
Company's independent public accountants concerning the scope of their
examinations of the Company's financial statements, the Company's accounting
policies and internal accounting controls and the results of the independent
public accountants' audit examination, and recommends the selection of the
Company's independent public accountants to the Board of Directors. The
Committee's duties do not include accounting or auditing functions, which are
the responsibility of the Company's officers and its independent public
accountants. The Audit Committee met three times in fiscal 1998. The current
Audit Committee members are Messrs. Mandell and Philbin, neither of whom is an
employee of the Company, and Mr. Goldberg.
The Board of Directors has a Compensation Committee, which oversees
compensation policy, executive salaries, profit sharing, stock options, employee
stock purchase and other benefit and incentive compensation plans, and
employment contracts. In fiscal 1998, the Compensation Committee met four times.
The current Compensation Committee members are Mr. Devitt, who is not an
employee of the Company, and Mr. Goldberg, who was employed by the Company on a
part-time basis in fiscal 1998. See "Compensation Committee Interlocks and
Insider Participation" and "Certain Transactions."
The Board has no other standing committees.
DIRECTORS' COMPENSATION
During fiscal 1998, each non-employee director of the Company (Messrs.
Devitt, Gorman, Mandell, Philbin and Reinig), was paid an annual retainer of
$3,000 plus $1,000 for each Board meeting attended, plus expenses incurred in
attending all such meetings. Non-employee directors also may be compensated at
the rate of $1,000 per day and receive reimbursement for travel and other
expenses for Board related activities. In addition, each of the members of the
Company's Compensation Committee and Audit Committee is compensated on a
quarterly basis and receives reimbursement for travel and other expenses. Mr.
Gorman was compensated at the rate of $1,250 per quarter, and Messrs. Devitt,
Mandell and Philbin are compensated at the rate of $750 per quarter. Messrs.
Devitt, Gorman, Mandell, Philbin and Reinig received $17,500, $8,500, $16,500,
$13,500 and $13,500, respectively, plus reimbursable expenses, for such
activities during fiscal year 1998. Each non-employee director also may provide
management consulting services to the Company, for which he is compensated at a
rate of $150 per hour plus expenses for services so rendered. Messrs. Devitt,
Gorman, Philbin, and Reinig received $1,200, $6,450, $1,000 and $1,500
respectively, plus expenses, for such services in fiscal 1998. In addition, in
July 1997 each non-employee director was granted 1,000 shares of Common Stock,
subject to certain transfer restrictions, in connection with his service on the
Board of Directors.
Directors who are employees of the Company are not compensated separately
for serving as directors.
5
<PAGE> 8
EXECUTIVE COMPENSATION
Summary Compensation Table. The following table provides certain summary
information concerning compensation paid to the Company's Chief Executive
Officer and President and its four other most highly compensated executive
officers (collectively, the "Named Executive Officers") for the fiscal years
ended February 28, 1998 and 1997 and February 29, 1996.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
AWARDS
ANNUAL COMPENSATION ------------------------
-------------------- RESTRICTED SECURITIES ALL OTHER
NAME AND SALARY BONUS STOCK UNDERLYING COMPENSATION($)
PRINCIPAL POSITION(S) YEAR ($) ($) AWARDS($) OPTIONS(#) (1)(2)
--------------------- ---- --------- -------- ---------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Andrew P. Pajak.................... 1998 $178,326 $27,146 -- -- $21,600
Chief Executive Officer and 1997 96,357 17,000 30,000(3) 75,000 48,637
President 1996 -- -- -- -- --
M. Joseph Celi..................... 1998 151,133 10,185 -- -- 8,506
Executive Vice President -- 1997 150,295 7,713 -- 13,400 12,480
Remediation Services; 1996 150,010 23,000 -- -- 10,263
President, GZA Remediation
Richard M. Simon................... 1998 142,002 12,427 -- -- 6,529
Executive Vice President -- 1997 140,005 7,332 -- 6,200 8,514
Professional Practice of the 1996 140,005 7,955 -- -- 8,268
Company and of GZA
GeoEnvironmental
John E. Ayres...................... 1998 141,045 5,941 -- -- 7,740
Executive Vice President -- 1997 139,795 5,300 -- -- 10,206
Business Development of the 1996 140,005 4,615 -- -- 9,039
Company and of GZA
GeoEnvironmental
William R. Beloff.................. 1998 134,763 17,000 -- -- 5,877
Senior Vice President of 1997 130,208 12,500 -- 4,000 7,110
GZA GeoEnvironmental 1996 121,126 21,037 9,546(3) -- 7,332
</TABLE>
- ---------------
(1) Amounts shown consist of the Company's contribution under the Company's
401(k) Profit Sharing Plan and the value of employer-paid premiums for term
life insurance programs. The Company's contributions under the 401(k) Profit
Sharing Plan in fiscal 1998 were as follows: Mr. Pajak, $6,400; Mr. Celi,
$6,400; Mr. Simon, $5,665; Mr. Ayres, $5,634 and Mr. Beloff, $5,355. The
value of employer-paid premiums for term life insurance paid by the Company
in fiscal 1998 were as follows: Mr. Pajak, $522; Mr. Celi, $2,106; Mr.
Simon, $864; Mr. Ayres, $2,106 and Mr. Beloff, $522. In addition, amounts
for Mr. Pajak include $14,678 reimbursement of non-deductible moving
expenses.
(2) The Company's contributions under the 401(k) Profit Sharing Plan in fiscal
1997 were as follows: Mr. Pajak, $0; Mr. Celi, $6,718; Mr. Simon, $6270; Mr.
Ayres, $6,270; and Mr. Beloff, $5,754. The value of employer-paid premiums
for term life insurance paid by the Company in fiscal 1997 were as follows:
Mr. Pajak, $812; Mr. Celi, $5,762; Mr. Simon, $2,244; Mr. Ayres, $3,936 and
Mr. Beloff, $1,356. In addition, amounts shown for Mr. Pajak include a
$10,000 sign-on bonus and $37,825 reimbursed to Mr. Pajak for non-deductible
moving expenses.
(3) Represents the value, on the date of grant, of shares of Common Stock of the
Company("Restricted Stock") granted under the Company's 1995 Stock Incentive
Plan. The shares of Restricted Stock vest in
6
<PAGE> 9
five equal annual installments on each of the first five anniversary dates.
The unvested portion of the Restricted Stock may not be sold, assigned,
transferred, pledged or otherwise encumbered or disposed of. In the event of
termination of employment by the Company for any reason, any unvested
Restricted Stock will be forfeited to the Company. In the event that the
Company is acquired by, or merged with, another firm, the unvested portion
of Mr. Pajak's Restricted Stock will become fully vested.
Option Grants in Last Fiscal Year. None of the Named Executive Officers
were granted stock options during fiscal 1998.
Option Exercises and Fiscal Year-End Values. The following table sets
forth certain information concerning stock options exercised during fiscal 1998
and stock options held as of February 28, 1998 by each of the Named Executive
Officers.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
SHARES UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
ACQUIRED OPTIONS AT FISCAL YEAR END AT FISCAL YEAR END($)(1)
ON VALUE --------------------------- ---------------------------
EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
NAME (#) ($) (#) (#) ($) ($)
---- -------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Andrew P. Pajak....... -- -- 30,000 45,000 $44,070 $66,105
M. Joseph Celi........ -- -- 13,400 -- 19,685 --
Richard M. Simon...... -- -- 6,200 -- 9,108 --
John E. Ayres......... -- -- -- -- -- --
William E. Beloff..... -- -- 2,400 1,600 3,526 2,350
</TABLE>
- ---------------
(1) Value is based on the last sale price of the Common Stock ($4.969 per share)
on February 27, 1998, as reported by the Nasdaq National Market, less the
applicable option exercise price. These values have not been and may never
be realized. Actual gains upon exercise, if any, will depend on the value of
the Common Stock on the date of the sale of the shares.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Compensation Policies. The purposes of the Company's policy for
compensating its executive officers are: (i) to establish aggregate compensation
levels that are consistent with the Company's financial performance; (ii) to
provide appropriate recognition and reward for individual performance and goal
achievement, thereby enhancing Company's profitability and thus stockholder
value; and (iii) to maintain total compensation levels that are sufficiently
competitive to retain and, when necessary, to attract executive officers who can
lead the Company in the attainment of its business objectives.
In fiscal 1998, base salaries were selectively increased so as to remain
competitive with the levels of compensation paid by comparable firms. Senior
executives and other selected Company employees also may qualify for cash
bonuses through participation in the Company's Incentive Compensation Plan. To
maintain an emphasis on incentive-based compensation, the dollar increases in
base salary for fiscal 1998 were modest, and the amount of bonus compensation
that could be earned under the Incentive Compensation Plan based on the
Company's performance remained significant.
In addition to the Incentive Compensation Plan, senior executives are
eligible to participate in various benefit programs provided to all full-time
employees in varying degrees -- including the Company's 401(k)
7
<PAGE> 10
Profit Sharing Plan and a supplemental life and accidental death and disability
insurance program whereby term insurance premiums are paid by the Company on
behalf of senior executives and other selected Company employees.
Base Salaries. The salaries of the executive officers are established
annually by evaluating requirements of each executive officer's position, the
contribution of such executive officer to the Company's performance and such
executive officer's responsibility, experience and potential. Base salaries of
executive officers are intended to be comparable to the salaries paid by a peer
group of comparably-sized companies and to salaries of executive officers
reported in an environmental industry salary survey. In making such comparisons,
the Company's financial performance as well as non-financial measures, such as
contributions to the success of the Company's strategic plan, are considered. In
fiscal year 1998, the base salaries of the executive officers named in the
Summary Compensation Table were selectively increased, as compared with fiscal
1997, to be consistent with their current duties and responsibilities.
Communications with Stockholders. The Compensation Committee is
responsible for communicating with stockholders regarding the Company's
compensation policy and to ensure that the Board of Directors understands
stockholders' perspectives regarding executive compensation. Members of the
Committee may, when appropriate, respond to stockholder concerns about
compensation in subsequent reports or proxy statements. Comments and questions
may be addressed to any member of the Compensation Committee at GZA
GeoEnvironmental Technologies, Inc., 320 Needham Street, Newton Upper Falls,
Massachusetts 02464.
Timothy W. Devitt, Chair
Donald T. Goldberg
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company's Compensation Committee currently consists of Messrs. Devitt
and Goldberg. Mr. Devitt is not, nor ever has been, an officer or employee of
the Company or of any of its subsidiaries. Mr. Goldberg, who was elected to the
Compensation Committee in October 1995, was employed by the Company as its Chief
Executive Officer until his retirement in September 1995. Since January 1997,
Mr. Goldberg has been employed by the Company on a part-time basis. See "Certain
Transactions." There are no family relationships among the executive officers or
directors of the Company.
8
<PAGE> 11
PERFORMANCE GRAPH
The following Performance Graph compares the performance of the Company's
cumulative stockholder return with that of a broad market index, the Nasdaq
Stock Market Index for U.S. Companies, and with those equity securities of a
peer group of issuers in the environmental consulting industry selected by the
Company. Issuers in the peer group consist of EA Engineering, Science, and
Technology, Inc., Ecology & Environment Inc., EMCON, Fluor Daniel GTI, Inc.,
Harding Lawson Associates Group, Inc., Versar, Inc. and Roy F. Weston, Inc. The
cumulative stockholder returns for shares of the Company's Common Stock and for
the market and peer group indices are calculated assuming $100 was invested on
March 1, 1992, the date on which the Company's Common Stock commenced trading on
the Nasdaq National Market (and assuming the reinvestment of dividends, if any,
as of the last day of February in each of the five succeeding years). The
Company paid no cash dividends during the periods shown.
COMPARISON OF CUMULATIVE TOTAL RETURN OF
COMPANY, PEER GROUP AND BROAD MARKET
<TABLE>
<CAPTION>
MEASUREMENT PERIOD BROAD
(FISCAL YEAR COVERED) GZA PEER GROUP MARKET
<S> <C> <C> <C>
1993 100 100 100
1994 148.39 95.76 127.41
1995 77.42 64.25 121.65
1996 87.10 60.00 167.97
1997 80.65 48.54 201.61
1998 128.23 60.92 274.20
</TABLE>
9
<PAGE> 12
CERTAIN TRANSACTIONS
The Company leases certain of its facilities from employees, some of whom
are directors, executive officers or stockholders of the Company, or from
entities in which such persons have interests.
The Company's principal facility in Newton Upper Falls, Massachusetts is
leased from Donald T. Goldberg, Chairman of the Board of the Company and a
beneficial owner of more than five percent of the outstanding Common Stock of
the Company, and William S. Zoino, formerly a director and executive officer and
currently a beneficial owner of more than five percent of the outstanding Common
Stock of the Company. Mr. Goldberg and Mr. Zoino own the property as tenants in
common. Rental payments to Messrs. Goldberg and Zoino aggregated $714,000 for
fiscal 1998.
The Company's Brockton, Massachusetts facility is leased from GZA
Investment Associates Trust, a Massachusetts business trust in which the Company
owns a two-thirds interest together with two other shareholders, Mr. Zoino and
Joseph E. Hebert, a former employee of GZA Drilling. Lease payments to GZA
Investment Associates Trust totaled $72,000 in fiscal 1998.
The Company's Providence, Rhode Island facility is leased from GZRI
Associates, a Rhode Island general partnership whose partners are Messrs.
Goldberg and Zoino and four others, Michael A. Powers, Frank W. Clark, David R.
Carchedi and Nicholas A. Campagna, all current employees of GZA
GeoEnvironmental. Lease payments to GZRI Associates totaled $114,771 in fiscal
1998.
The Company believes that the foregoing leases were entered into on terms
no less favorable to the Company than could reasonably have been obtained in
arm's-length transactions with independent third parties.
The Company provides geotechnical design, instrumentation and other
consulting services, on a contracting and subcontracting basis, to Perini
Corporation and other clients affiliated with or engaged in joint ventures with
Perini Corporation. David B. Perini, a director of the Company, is the Chairman
of the Board of Directors of Perini Corporation. In fiscal 1998 the Company
billed an aggregate of $1.6 million for services provided to Perini Corporation
and clients affiliated with Perini Corporation.
Donald T. Goldberg, Chairman of the Board of Directors and formerly the
Company's Chief Executive Officer, is a part-time employee of GZA
GeoEnvironmental who manages certain technical projects under contract by the
Company. During fiscal 1998, Mr. Goldberg was paid a salary of $95,385 plus
expenses and statutory benefits. Since becoming an employee of the Company on a
part-time basis, Mr. Goldberg has received no separate compensation for his
service as a director.
AGREEMENTS WITH EXECUTIVE OFFICERS
Each of Messrs. Goldberg, Pajak, Simon, Ayres, Celi, Beloff, Guertin, Hadge
and Hehir has entered into a Non-Competition and Non-Disclosure Agreement with
the Company which provides, among other things, that following the termination
of his employment, and provided that he complies with certain non-competition
covenants set forth in the agreement, he may be entitled to receive, for a
period of up to twelve months following such termination, his base salary and
certain other benefits.
10
<PAGE> 13
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information with respect to the
beneficial ownership of the Company's Common Stock as of May 22, 1998 by (i)
each person or group known to the Company to be the beneficial owner of more
than five percent of the outstanding Common Stock; (ii) each of the Company's
directors and director nominees; (iii) each of the Named Executive Officers and
(iv) all directors, director nominees and executive officers of the Company as a
group. The information as to each person has been furnished by such person.
<TABLE>
<CAPTION>
SHARES
BENEFICIALLY OWNED(2)
---------------------
NAMES AND ADDRESSES OF BENEFICIAL HOLDERS(1) NUMBER PERCENT
-------------------------------------------- -------- --------
<S> <C> <C>
Heartland Advisors.......................................... 526,500 12.9%
750 North Milwaukee Street
Milwaukee, Wisconsin 53202
William Zoino............................................... 409,368 10.1
175 Moraine Street
Brockton, Massachusetts 02401
Franklin Resources, Inc.(3)................................. 265,000 6.5
777 Mariners Island Boulevard
San Mateo, CA 94404
Donald T. Goldberg(4)....................................... 242,928 6.0
John E. Ayres(5)............................................ 148,563 3.7
Joseph D. Guertin, Jr.(6)................................... 104,264 2.6
Richard M. Simon(7)......................................... 69,124 1.7
Andrew Pajak(8)............................................. 40,314 1.0
William R. Beloff(9)........................................ 38,934 1.0
M. Joseph Celi(10).......................................... 23,696 *
William E. Hadge(11)........................................ 18,536 *
Lewis Mandell(12)........................................... 9,100 *
Timothy W. Devitt(13)....................................... 8,350 *
Thomas W. Philbin(14)....................................... 4,100 *
All directors, director nominees and executive officers
as a group (15 persons)(15)............................... 752,070 18.2
</TABLE>
- ---------------
* Less than one percent.
(1) The address of all persons who are executive officers or directors of the
Company is in care of the Company, 320 Needham Street, Newton Upper Falls,
Massachusetts 02464.
(2) Unless otherwise noted, each person or group identified possesses sole
voting and investment power with respect to such shares, subject to
community property laws where applicable. Shares not outstanding but deemed
beneficially owned by virtue of the right of a person or group to acquire
them within 60 days of May 22, 1998 are treated as outstanding only for
purposes of determining the amount and percent owned by such person or
group. As of May 22, 1998, there were 4,066,968 shares of Common Stock
outstanding.
(3) Franklin Resources, Inc. is the parent holding company for Franklin Advisory
Services, Inc., an investment company. Franklin Advisory Services, Inc. has
sole power to vote or direct the vote of the shares. The principal
stockholders of Franklin Resources, Inc. are Charles B. Johnson and Rupert
H. Johnson, Jr., so that Charles B. Johnson, Rupert H. Johnson, Jr. and
Franklin Advisory Services, Inc. may be deemed to be the beneficial owners
of such shares.
11
<PAGE> 14
(4) Includes 1,207 shares issued to Mr. Goldberg under the Company's 401(k)
Plan and 100,000 shares held by a family trust for certain family members
of Mr. Goldberg. Mr. Goldberg, who is not a trustee of the trust, disclaims
beneficial ownership of these shares. Mr. Goldberg is the Chairman of the
Board of Directors of the Company.
(5) Includes 1,680 shares issued to Mr. Ayres under the Company's 401(k) Plan.
Mr. Ayres is the Executive Vice President--Business Development of the
Company and the Executive Vice President--Business Development of GZA
Remediation.
(6) Includes 1,669 shares issued to Mr. Guertin under the Company's 401(k)
Plan. Mr. Guertin is a director of the Company.
(7) Includes 1,677 shares issued to Mr. Simon under the Company's 401(k) Plan
and 6,200 shares subject to stock options exercisable within 60 days of May
22, 1998. Mr. Simon is the Executive Vice President--Professional Practice
of the Company and the Executive Vice President--Professional Practice of
GZA GeoEnvironmental.
(8) Includes 314 shares issued to Mr. Pajak under the Company's 401(k) Plan and
30,000 shares subject to stock options exercisable within 60 days of May
22, 1998. Mr. Pajak is the President and Chief Executive Officer and a
director of the Company.
(9) Includes 1,478 shares issued to Mr. Beloff under the Company's 401(k) Plan
and 2,400 shares subject to stock options exercisable within 60 days of May
22, 1998. Mr. Beloff is the Senior Vice President of GZA GeoEnvironmental.
(10) Includes 1,791 shares issued to Mr. Celi under the Company's 401(k) Plan
and 13,400 shares subject to stock options exercisable within 60 days of
May 22, 1998. Mr. Celi is the Executive Vice President -- Remediation
Services and a director of the Company.
(11) Includes 1,319 shares issued to Mr. Hadge under the Company's 401(k) Plan
and 3,600 shares subject to stock options exercisable within 60 days of May
22, 1998. Mr. Hadge is the Senior Vice President of GZA GeoEnvironmental
and a director of the Company.
(12) Includes 2,500 shares subject to stock options exercisable within 60 days
of May 22, 1998. Mr. Mandell is a director of the Company.
(13) Includes 2,500 shares subject to stock options exercisable within 60 days
of May 22, 1998. Mr. Devitt is a director of the Company.
(14) Includes 2,500 shares subject to stock options exercisable within 60 days
of May 22, 1998. Mr. Philbin is a director of the Company.
(15) Includes shares described in Notes (4), (5), (6), (7), (8), (9), (10),
(11), (12), (13) and (14).
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's directors,
executive officers and persons who own more than ten percent of the outstanding
Common Stock file with the Securities and Exchange Commission reports of
ownership on Form 3 and reports of changes in ownership on Forms 4 and 5.
Securities and Exchange Commission regulations require directors, executive
officers and greater-than-ten-percent stockholders to furnish the Company with
copies of all Forms 3, 4 and 5 filed with the Securities and Exchange
Commission.
Based solely upon a review of Forms 3 and 4 that were furnished to the
Company during fiscal 1998, Forms 5 that were furnished to the Company by
certain directors and executive officers of the Company with
12
<PAGE> 15
respect to fiscal 1998 and representation letters of certain other directors and
executive officers to the effect that Form 5 filings were not required, the
Company believes that all Section 16(a) filing requirements applicable to its
directors, executive officers and greater-than-ten-percent stockholders were
fulfilled in a timely manner, except that Messrs. Beloff, Devitt, Mandell,
Philbin and Reinig each failed to file on a timely basis one Form 4 with respect
to a single transaction, and Messrs. Hadge and Perini each failed to file a
report on Form 3 upon becoming a director of the Company during fiscal 1998.
PROPOSAL TWO: RATIFICATION OF
INDEPENDENT ACCOUNTANTS
The Board of Directors has appointed Coopers & Lybrand L.L.P. as
independent accountants to audit the financial statements of the Company for the
fiscal year ending February 28, 1999, and submits this appointment for
ratification by the stockholders at the Meeting. Representatives of Coopers &
Lybrand L.L.P. are expected to be present at the Meeting, will have an
opportunity to make a statement if they desire to do so, and are expected to be
available to appropriate questions from stockholders.
If a quorum is present at the Meeting, the affirmative vote of holders of a
majority of the Common Stock present or represented and voted at the meeting is
required to ratify the appointment of the Company's independent public
accountants.
The Board of Directors recommends that you vote FOR the ratification of the
Company's appointment of Coopers & Lybrand L.L.P. as the Company's independent
public accountants for the 1999 fiscal year.
SOLICITATION
The Company will bear the cost of soliciting proxies. Brokers, banks and
other nominees will be reimbursed for their out-of-pocket expenses and other
reasonable clerical expenses incurred in obtaining instructions from beneficial
owners of the Common Stock. In addition to the solicitation by mail, the
directors, officers and certain employees of the Company may solicit proxies,
without additional remuneration, by telephone, facsimile, telegraph and in
person. It is expected that the expense of such special solicitation will be
nominal.
STOCKHOLDER PROPOSALS
Any stockholder intending to present a proposal at the 1999 Annual Meeting
of Stockholders must submit such proposal to the Company at its offices no later
than February 15, 1999 in order to be considered for inclusion in the proxy
statement relating to that meeting.
In addition, under the Amended and Restated By-laws of the Company, any
stockholder intending to present at the 1999 Annual Meeting (a) any proposal
(other than a proposal by, or at the direction of, the Board of Directors of the
Company) relating to nomination of candidates for election as directors of the
Company or (b) any other proposal not made by, or at the direction of, the Board
of Directors, Chairman of the Board or President of the Company, must give
written notice of such proposal (including certain information about any nominee
or matter proposed and the proposing stockholder) to the Secretary of the
Company not later than May 15, 1999 and not before February 14, 1999; provided,
however, that if less than 70 days' notice or prior public disclosure of the
scheduled Annual Meeting is given or made, such notice from the shareholder, to
be timely, must be given within 10 days following public disclosure or mailing
of notice of the meeting, whichever is earlier.
13
<PAGE> 16
MISCELLANEOUS
The Board of Directors does not know of any business that will be presented
for consideration at the Meeting other than that described in this Proxy
Statement. However, if any other business should come before the Meeting, the
persons named in the enclosed form of proxy will vote, or otherwise act, in
accordance with their best judgment.
AVAILABLE INFORMATION
Stockholders of record at the close of business on May 22, 1998 will
receive a Proxy Statement, the Company's Annual Report to Stockholders, which
contains detailed financial information concerning the Company, and the
Company's Annual Report on Form 10-K for fiscal 1998 (excluding exhibits). The
Company will mail, without charge, a copy of the Company's Annual Report on Form
10-K (excluding exhibits) to any stockholder solicited hereby who requests it in
writing. Please submit any such written request to Mr. Joseph P. Hehir, Senior
Vice President and Chief Financial Officer, 320 Needham Street, Newton Upper
Falls, Massachusetts 02464.
14
<PAGE> 17
PROXY
GZA GEOENVIRONMENTAL TECHNOLOGIES, INC.
320 NEEDHAM STREET
NEWTON UPPER FALLS, MASSACHUSETTS 02464
Proxy for Annual Meeting of Stockholders
to be held on July 14, 1998
The undersigned hereby constitutes and appoints Donald T. Goldberg, Andrew P.
Pajak and Joseph D. Guertin, Jr., and each of them acting singly, as proxies of
the undersigned, each with full power to appoint his substitute, and authorizes
each of them, and each substitute so appointed, to represent and vote all
shares of Common Stock of GZA GeoEnvironmental Technologies, Inc. (the
"Company") held of record by the undersigned at the close of business on May 22,
1998 at the Annual Meeting of Stockholders of the Company to be held at The
Sheraton Needham Hotel, 100 Cabot Street, Needham, Massachusetts on July 14,
1998 at 10:00 a.m. local time and at any adjournments thereof.
The undersigned hereby acknowledge(s) receipt of a copy of the accompanying
Notice of Annual Meeting of Stockholders and of the Proxy Statement relating
thereto, and hereby revoke(s) any proxy or proxies heretofore given. This proxy
may be revoked at any time before it is exercised.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
<PAGE> 18
GZA GEOENVIRONMENTAL TECHNOLOGIES, INC.
Dear Stockholder:
Please take note of the important information enclosed with this Proxy Ballot.
There are a number of issues related to the management and operation of your
Company that require your immediate attention and approval. These are discussed
in detail in the enclosed proxy materials.
Your vote counts, and you are strongly encouraged to exercise your right to
vote your shares.
Please mark the boxes on the proxy card to indicate how your shares shall be
voted. Then sign the card, detach it and return your proxy vote in the enclosed
postage paid envelope.
Your vote must be received prior to the Annual Meeting of Stockholders, July
14, 1998, in order to be voted at the meeting.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
GZA GeoEnvironmental Technologies, Inc.
<PAGE> 19
<TABLE>
<S> <C>
Please Detach and Mail in the Envelope Provided
- ----------------------------------------------------------------------------------------------------------------------------------
A [X] PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE.
FOR ALL WITH-
EXCEPT HOLD FOR AGAINST ABSTAIN
1) Proposal to elect [ ] [ ] NOMINEES: Rose Ann Giordano 2) Proposal to ratify the appointment [ ] [ ] [ ]
the following Donald T. Goldberg of Coopers & Lybrand as the Company's
nominees to three year terms as Thomas W. Philbin independent public accountants for the
Class I Directors fiscal year ending February 28, 1999.
To withhold authority to vote for any THIS PROXY IS BEING SOLICITED ON BEHALF OF THE BOARD OF
individual nominee, check the "For All DIRECTORS OF THE COMPANY. WHEN PROPERLY EXECUTED, THIS PROXY
Except" box, and strike a line through WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED
that nominee's name in the list at right. STOCKHOLDER(S). IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE
VOTED FOR PROPOSALS 1 AND 2. THE COMPANY HAS RECEIVED NO NOTICE
OF ANY OTHER MATTER THAT WILL BE PRESENTED AT THE MEETING.
PURSUANT TO RULE 14a-4(c)(1), THIS PROXY WILL BE VOTED IN THE
DISCRETION OF THE PERSONS NAMES AS PROXIES AS TO ANY OTHER
MATTER AS MAY PROPERLY COME BEFORE THE MEETING. A STOCKHOLDER
WISHING TO VOTE IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE
BOARD OF DIRECTORS NEED ONLY SIGN AND DATE THIS PROXY AND
RETURN IT IN THE ENCLOSED ENVELOPE.
Comment/Address Change ______________________________________
_____________________________________________________________
_____________________________________________________________
_______________________________________________________GZA CM
RECORD DATE SHARES:
PLEASE SIGN, DATE AND MAIL YOUR PROXY CARD PROMPTLY IN THE
ENCLOSED ENVELOPE.
Stockholder sign here _____________________________________ Co-owner sign here __________________________________ Date ____, 1998
NOTE: Please sign exactly as name appears above. Joint owners should each sign. When signing as attorney, executor, administrator,
trustee or guardian, please give your full title.
</TABLE>
