SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
CB RICHARD ELLIS SERVICES, INC.
----------------------------------------
(Name of Issuer)
Common Stock, $0.01 par value
----------------------------------------
(Title of Class of Securities)
12489L108
----------------------------------------
(CUSIP Number)
Donald M. Koll
4343 Von Karman Avenue
Newport Beach, California 92660
(949) 833-3023
----------------------------------------
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
With a copy to:
Gary J. Singer, Esq.
O'Melveny & Myers LLP
610 Newport Center Drive
Suite 1700
Newport Beach, California 92660
November 10, 2000
----------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this Schedule
13D, and is filing this schedule because of Rule 13d-1(b)(3) or (4),
check the following box. [ ]
*The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to
the subject class of securities, and for any subsequent amendment
containing information which would alter disclosures provided
in a prior cover page.
The information required on the remainder of this cover page shall
not be deemed to be "filed" for the purpose of Section 18 of the
Securities Exchange Act of 1934 ("Act") or otherwise subject to
the liabilities of that section of the Act but shall be subject to all
other provisions of the Act (however, see the Notes).
<PAGE>
1. NAME OR REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSON (ENTITIES ONLY)
DONALD M. KOLL
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [X]
(b) [ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS*:
OO (See Item 3)
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e)
[ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION:
United States
NUMBER OF 7. SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY 8,564,419 (See Item 5)
EACH 9. SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10. SHARED DISPOSITIVE POWER
WITH 8,564,419 (See Item 5)
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,564,419 (See Item 5)
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
40.4% (See Item 5)
14. TYPE OF REPORTING PERSON
IN
*See Instructions Before Filling Out!
<PAGE>
1. NAME OR REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSON (ENTITIES ONLY)
THE DONALD M. KOLL SEPARATE PROPERTY TRUST
U/T/D APRIL 8, 1998
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [X]
(b) [ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS*:
OO (See Item 3)
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e)
[ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION:
California
NUMBER OF 7. SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY 8,564,419 (See Item 5)
EACH 9. SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10. SHARED DISPOSITIVE POWER
WITH 8,564,419 (See Item 5)
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,564,419 (See Item 5)
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
40.4% (See Item 5)
14. TYPE OF REPORTING PERSON
00
*See Instructions Before Filling Out!
<PAGE>
1. NAME OR REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSON (ENTITIES ONLY)
THE KOLL COMPANY
95-2262089
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [X]
(b) [ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS*:
OO (See Item 3)
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e)
[ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION:
California
NUMBER OF 7. SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY 8,564,419 (See Item 5)
EACH 9. SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10. SHARED DISPOSITIVE POWER
WITH 8,564,419 (See Item 5)
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,564,419 (See Item 5)
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
40.4% (See Item 5)
14. TYPE OF REPORTING PERSON
C0
*See Instructions Before Filling Out!
<PAGE>
1. NAME OR REPORTING PERSON
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSON (ENTITIES ONLY)
THE KOLL HOLDING COMPANY
33-0657131
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [X]
(b) [ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS*:
OO (See Item 3)
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e)
[ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION:
California
NUMBER OF 7. SOLE VOTING POWER
SHARES -0-
BENEFICIALLY
OWNED BY 8. SHARED VOTING POWER
EACH 8,564,419 (See Item 5)
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON -0-
WITH 10. SHARED DISPOSITIVE POWER
8,564,419 (See Item 5)
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,564,419 (See Item 5)
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
40.4% (See Item 5)
14. TYPE OF REPORTING PERSON
C0
*See Instructions Before Filling Out!
<PAGE>
Item 1. Security and Issuer
This statement relates to the Common Stock, $.01 par value (the
"Common Stock"), of CB Richard Ellis Services, Inc., a Delaware
corporation (the "Issuer"), having its principal executive offices
at 200 North Sepulveda Boulevard, Suite 300, El Segundo,
California 90245.
Item 2. Identity and Background.
This Statement on Schedule 13D is being filed pursuant to the
Joint Reporting Agreement attached hereto as Exhibit 4 on behalf
of (i) Donald M. Koll ("Koll"); (ii) the Donald M. Koll Separate
Property Trust u/d/t April 8, 1999 ("Koll Trust"); (iii) The Koll
Company, a California corporation ("Koll Co."); and (iv) The Koll
Holding Company, a California corporation ("Koll Holding")
(collectively with the foregoing clauses (i) through (iii), the
"Reporting Persons").
Koll Holding is wholly owned by Koll Co., which is wholly owned
by the Koll Trust. Koll is the sole trustee of the Koll Trust. Koll
is a United States citizen and a Director of the Issuer. Koll Co. is
a diversified real estate services firm. Koll Holding was formed to
acquire and hold equity in Koll Real Estate Services, which was
acquired by the Issuer on August 28, 1997 (as further described in
Item 4 hereto). The principal office and business address of Koll
Holding, Koll Co. and Koll is 4343 Von Karman Avenue, Newport Beach,
California 92660.
None of the entities or persons identified in the previous
paragraphs of this Item 2 has, during the past five years, been
convicted of any criminal proceeding (excluding traffic violations
or similar misdemeanors), nor been a party to a civil proceeding
of a judicial or administrative body of competent jurisdiction and
as a result of such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state
securities laws or finding any violation with respect to such
laws.
As described in Items 3 and 4 below, BLUM CB Corp., a Delaware
corporation ("Newco"), submitted a merger proposal to the Issuer
pursuant to which it would, subject to the conditions set forth in
such proposal, merge into the Issuer and the holders of the Common
Stock (other than certain holders described in Item 4 below) would
receive consideration of $15.50 per share in cash in exchange for
their shares of Common Stock. As further described in Items 3 and
4 below, Koll Holding, RCBA Strategic Partners, L.P., a Delaware
limited partnership ("Strategic"), FS Equity Partners III, L.P., a
Delaware limited partnership ("FSEP III"), FS Equity Partners
International, L.P. ("FSEP International"), Raymond E. Wirta
("Wirta"), W. Brett White ("White") and Frederic V. Malek
("Malek," and together with Wirta and White, the "Other Parties")
have entered into a letter agreement, dated as of November 10,
2000 (such letter, the "Letter Agreement") (attached hereto as
Exhibit 1), pursuant to which, among other things, the parties to
the Letter Agreement other than Strategic have agreed to certain
terms with respect to their ability to vote or to dispose of
the shares of Common Stock beneficially owned by them. As a
result of the Letter Agreement, the Reporting Persons, together
with Newco, BLUM Capital Partners, L.P., a California limited
partnership ("BLUM LP"), Richard C. Blum & Associates, Inc., a
California corporation ("RCBA Inc."), RCBA GP, L.L.C., a Delaware
limited liability company ("RCBA GP"), Richard C. Blum, the
Chairman and a substantial shareholder of RCBA Inc. and a managing
member of RCBA GP (collectively with BLUM LP, RCBA Inc.,
Strategic, RCBA GP and Newco, the "BLUM Parties"), FSEP III, FS
Capital Partners, L.P., a California limited partnership ("FS
Capital"), FS Holdings, Inc., a California corporation ("FS
Holdings"), FSEP International, FS&Co. International, L.P., a
Cayman Islands exempted limited partnership ("FS&Co.
International"), FS International Holdings Limited, a Cayman
Islands exempted company limited by shares ("International
Holdings"), Bradford M. Freeman ("Freeman"), Ronald P. Spogli
("Spogli"), William M. Wardlaw ("Wardlaw"), J. Frederick Simmons
("Simmons"), John M. Roth ("Roth"), Charles P. Rullman, Jr.
("Rullman," and together with FSEP III, FS Capital, FS Holdings,
FSEP International, FS&Co. International, International Holdings,
Freeman, Spogli, Wardlaw, Simmons and Roth, the "FS Parties") and
the Other Parties may be deemed to constitute a group within the
meaning of Section 13(d)(3) of the Securities Exchange Act of
1934, as amended (together with the rules and regulations
promulgated by the Securities and Exchange Commission thereunder,
the "Exchange Act").
The Reporting Persons have been advised by the BLUM Parties of the
following information with respect to the BLUM Parties as set
forth below:
Newco is a Delaware corporation newly formed by Strategic. The
principal business of Newco is to engage in the Proposed
Transaction described in Items 3 and 4 below. The principal
business office address of Newco is 909 Montgomery Street, Suite
400, San Francisco, California 94133.
Strategic is a Delaware limited partnership whose principal
business is investing in securities and whose principal office is
909 Montgomery Street, Suite 400, San Francisco, California 94133.
RCBA GP is a Delaware limited liability company whose principal
business is acting as the sole general partner of Strategic. The
principal business office address of RCBA GP is 909 Montgomery
Street, Suite 400, San Francisco, California 94133. The names of
the managing members and members of RCBA GP, their addresses,
citizenship and principal occupations are as follows:
<TABLE>
<CAPTION>
Principal
Name and Occupation
Office Held Business Address Citizenship or Employment
---------------------------------------------------------------------------
<S> <C> <C> <C>
Richard C. Blum 909 Montgomery Street USA President and
Managing Member Suite 400 Chairman, BLUM LP
San Francisco, CA 94133
Nils Colin Lind 909 Montgomery Street Norway Managing Partner,
Managing Member Suite 400 BLUM LP
San Francisco, CA 94133
Jeffrey W. Ubben 909 Montgomery Street USA Managing Partner,
Managing Member Suite 400 BLUM LP
San Francisco, CA 94133
George F. Hamel, Jr. 909 Montgomery Street USA Partner, BLUM LP
Member Suite 400
San Francisco,
CA 94133
Marc T. Scholvinck 909 Montgomery Street USA Partner and Chief
Member Suite 400 Financial Officer
San Francisco, BLUM LP
CA 94133
Murray A. Indick 909 Montgomery Street USA Partner and General
Member Suite 400 Counsel, BLUM LP
San Francisco, CA 94133
John C. Walker 909 Montgomery Street USA Partner, BLUM LP
Member Suite 400
San Francisco, CA 94133
</TABLE>
BLUM LP is a California limited partnership whose principal
business is acting as general partner for investment partnerships
and providing investment advisory services. BLUM LP is a
registered investment adviser with the Securities and Exchange
Commission. The sole general partner of BLUM LP is RCBA Inc. The
principal business office address of BLUM LP and RCBA Inc. is 909
Montgomery Street, Suite 400, San Francisco, California 94133.
The names of the executive officers and directors of RCBA Inc.,
their addresses, citizenship and principal occupations are as
follows:
<TABLE>
<CAPTION>
Principal
Name and Occupation
Office Held Business Address Citizenship or Employment
---------------------------------------------------------------------------
<S> <C> <C> <C>
Richard C. Blum 909 Montgomery Street USA President and
President, Suite 400 Chairman,
Chairman and San Francisco, CA 94133 BLUM LP
Director
Nils Colin Lind 909 Montgomery Street Norway Managing Partner,
Managing Partner Suite 400 BLUM LP
and Director San Francisco, CA 94133
Jeffrey W. Ubben 909 Montgomery Street USA Managing Partner,
Managing Partner Suite 400 BLUM LP
and Director San Francisco, CA 94133
Claus J. Moller 909 Montgomery Street Denmark Managing Partner,
Managing Partner San Francisco, CA 94133 BLUM LP
and Director
George F. Hamel, Jr. 909 Montgomery Street USA Partner, BLUM LP
Partner Suite 400
San Francisco, CA 94133
Marc T. Scholvinck 909 Montgomery Street USA Partner and Chief
Partner, Chief Suite 400 Financial Officer,
Financial Officer, San Francisco, CA 94133 BLUM LP
Assistant Secretary
and Director
Murray A. Indick 909 Montgomery Street USA Partner and General
Partner, General Suite 400 Counsel, BLUM LP
Counsel and San Francisco, CA 94133
Secretary
John C. Walker 909 Montgomery Street USA Partner, BLUM LP
Partner Suite 400
San Francisco, CA 94133
Kevin A. Richardson 909 Montgomery Street USA Partner, BLUM LP
Partner Suite 400
San Francisco, CA 94133
</TABLE>
The Reporting Persons have been advised by the FS Parties of the
following information with respect to the FS Parties as set forth
below:
FS Holdings is the general partner of FS Capital, which is the
general partner of FSEP III. International Holdings is the
general partner of FS&Co. International, which is the general
partner of FSEP International.
FSEP III, FS Capital and FS Holdings each has its principal
business address and its principal office at 11100 Santa Monica
Boulevard, Suite 1900, Los Angeles, California 90025. FSEP III
was formed to make private equity investments. FS Capital and FS
Holdings were each formed to organize and manage the transactions
in which FSEP III is the principal investor.
FSEP International, FS&Co. International and International
Holdings each has its principal business address and its principal
office at c/o Paget-Brown & Company, Ltd., West Winds Building,
Third Floor, P.O. Box 1111, Grand Cayman, Cayman Islands, B.W.I.
FSEP International was formed to make private equity investments.
FS&Co. International and International Holdings were each formed
to organize and manage the transactions in which FSEP
International is the principal investor.
Freeman, Spogli, Wardlaw, Simmons, Roth and Rullman are the
directors, executive officers and sole shareholders of FS Holdings
and International Holdings. The principal occupation of each of
Freeman, Spogli, Wardlaw, Simmons, Roth and Rullman is to serve as
the directors and executive officers of Freeman Spogli & Co.
Incorporated, a Delaware corporation formed to make private equity
investments ("FS&Co."). Each of Freeman, Spogli, Wardlaw,
<PAGE>
Simmons and Rullman has his principal business address and his principal
office at 11100 Santa Monica Boulevard, Suite 1900, Los Angeles,
California 90025. Roth has his principal business address and his
principal office at 599 Lexington Avenue, 18th Floor, New York,
New York 10022.
The Reporting Persons have been advised by the Other Parties of
the following information with respect to the Other Parties as set
forth below:
Wirta is a United States citizen whose principal occupation is
Chief Executive Officer and a Director of the Issuer. His
business address is CB Richard Ellis Services, Inc., 200 North
Sepulveda Boulevard, El Segundo, California 90245-4380.
White is a United States citizen whose principal occupation is
Chief Operating Officer and a Director of the Issuer. His
business address is CB Richard Ellis Services, Inc., 200 North
Sepulveda Boulevard, El Segundo, California 90245-4380.
Malek is a United States citizen and a Director of the Issuer.
His principal business occupation is Chairman of Thayer Capital
Partners. His business address is Thayer Capital Partners, 1455
Pennsylvania Avenue, N.W., Suite 350, Washington DC 20004.
The BLUM Parties, the FS Parties and the Other Parties have
advised the Reporting Persons that, during the last five years, to
the best knowledge of the BLUM Parties, the FS Parties and the
Other Parties, respectively, none of the BLUM Parties, the FS Parties
or the Other Parties has been (i) convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors)
or (ii) a party to any civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of
such proceeding was or is subject to a judgment, decree or final
order enjoining any future violations of, or prohibiting or
mandating activities subject to, federal or state securities laws
or finding any violations with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
The Proposed Transaction (as defined in Item 4 below) would be
funded through a combination of equity and debt financing.
Pursuant to, and subject to the terms and conditions of, the
Letter Agreement, Koll Holding will contribute to Newco all of
the Common Stock beneficially owned by it and Strategic
and/or its affiliates are prepared to provide up to approximately
$118.1 million of equity to Newco for the Proposed Transaction.
In addition, Newco has had discussions with Credit Suisse First
Boston to provide debt financing to consummate the Proposed
Transaction; however, Newco has not yet entered into a commitment
letter with respect to the debt financing for the Proposed
Transaction, and there is no assurance that one will be
successfully obtained. In addition, the proposed financing of the
Proposed Transaction may change based on availability of such
financing and other facts and circumstances with respect to such
Proposed Transaction or financing.
None of the Reporting Persons has contributed any funds or other
consideration toward the purchase of the shares of Issuer Common
Stock that may be deemed to be beneficially owned by the BLUM
Parties, the FS Parties or the Other Parties as described in Item
5.
<PAGE>
The transactions contemplated by the Letter Agreement are subject
to a number of terms and conditions set forth therein, including,
among others, the approval of the Issuer's Board of Directors, the
execution of mutually acceptable documentation and the
satisfaction of the conditions set forth in the Proposal Letter
(as defined in Item 4 below). The information set forth in
response to this Item 3 is qualified in its entirety by reference
to the Letter Agreement (attached hereto as Exhibit 1), which is
expressly incorporated herein by reference.
Item 4. Purpose of Transaction.
As described in a letter, dated November 10, 2000, from Newco to
the Issuer (the "Proposal Letter") (attached hereto as Exhibit 2),
Newco has made a proposal with respect to a transaction in which
Newco would merge with and into the Issuer (the "Proposed
Transaction"). Pursuant to the terms of the Proposed Transaction,
among other things, (i) each of Koll Holding, Strategic, FSEP III, FSEP
International and the Other Parties will contribute all of the shares
of Common Stock beneficially owned by such person to Newco in exchange
for newly-issued shares of Newco, and (ii) immediately following
completion of the foregoing contributions, Newco will be merged into
the Issuer. Pursuant to the merger, all shares of the Common Stock
(other than the shares held by Newco) will be converted into the right
to receive consideration of $15.50 per share, all shares of Common
Stock held by Newco will be cancelled and all shares of common stock
of Newco will be converted into shares of the Common Stock. In
connection with the Proposed Transaction, the Common Stock would
be delisted from the New York Stock Exchange. The Reporting Persons
currently do not intend to deregister the Common Stock under the
Exchange Act but may do so in the future, to the extent permitted
under the Exchange Act.
Annex B of the Letter Agreement provides that the Board of
Directors of the Issuer after consummation of the Proposed
Transaction will consist of six directors, including three
directors designated by Strategic, one director designated by the
FS Parties, and Wirta and White (each for so long as he remains an
employee of the Issuer). In addition, Strategic will be entitled
to designate one additional director at any time.
The Proposal Letter provides that the Proposed Transaction would
be subject to a number of conditions, including, among others, (i)
approval by the Issuer's Board of Directors and stockholders
pursuant to the requirements of Delaware law and the rules of the
New York Stock Exchange, (ii) receipt of any material governmental
and third party approvals (including expiration of all applicable
waiting periods under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended), (iii) receipt of consents from the
holders of a majority of the Issuer's outstanding 8-7/8% Senior
Subordinated Notes due 2006, (iv) completion of the financing
arrangements necessary to consummate the Proposed Transaction,
(v) completion of confirmatory due diligence and (vi) the
negotiation and execution of definitive agreements providing for
the Proposed Transaction and the transactions described in the
Letter Agreement and the satisfaction of the conditions set forth
therein, including a mutually satisfactory definitive merger
agreement which would contain customary covenants,
representations, warranties, conditions and other provisions
normal to such agreements.
Newco's proposal contained in the Proposal Letter expires by its
terms at 5:00 p.m. Pacific Standard Time on December 1, 2000. All
decisions regarding the Proposed Transaction
<PAGE>
will be made by the BLUM Parties. The Reporting Persons expect
to evaluate on an ongoing basis the Issuer's financial condition,
business, operations and prospects, market price of the Common Stock,
conditions in securities markets generally, general economic and
industry conditions and other factors. Accordingly, the Reporting
Persons reserve the right to change their plans and intentions at
any time, as they deem appropriate. In particular, the Reporting
Persons may at any time and from time to time acquire shares of
Common Stock or securities convertible or exchangeable for Common
Stock or dispose of shares of Common Stock. Any such transactions
may be effected at any time and from time to time subject to any
applicable limitations of the Securities Act of 1933, as amended,
and the Exchange Act.
The Reporting Persons originally acquired the shares of Common
Stock beneficially owned by them (i) in Koll's capacity as a Director
of the Issuer and (ii) pursuant to the terms and conditions of an
Agreement and Plan of Reorganization, dated as of May 14, 1997 (the
"Merger Agreement") by and among the Issuer, CBC Acquisition
Corporation, a Delaware corporation ("Acquisition Corp."), Koll Real
Estate Services (formerly KMS Holding Corporation), a Delaware
corporation ("KRES"), FSEP III, FSEP International, AP KMS Partners,
L.P., AP KMS II, LLC, Koll Holding, Koll, William S. Rothe and Wirta.
On August 28, 1997, Acquisition Corp. was merged with and into KRES
(the "Merger") and KRES became a wholly-owned subsidiary of the Issuer.
In the Merger, Koll Holding received 734,290 shares of the Common
Stock and warrants to acquire 78,746 shares of the Common Stock. In
addition, Koll received an option to purchase 250,000 shares of the
Common Stock in the same transaction.
The Reporting Persons have been advised that the BLUM Parties
originally acquired the shares of Common Stock beneficially owned
by them through open market purchases of the Common Stock.
Blum serves on the Issuer's Board of Directors.
The Reporting Persons have been advised that each of the FS
Parties originally acquired the shares of Common Stock
beneficially owned by them pursuant to the Merger Agreement. In
the Merger, FSEP III received 3,278,448 shares of Common Stock
and warrants to acquire 351,585 shares of Common Stock (the
"FSEP III Warrant") and FSEP International received 124,015
shares of Common Stock and warrants to acquire 13,299 shares of
Common Stock (the "FSEP International Warrant", and collectively
with the FSEP Warrant, the "FS Warrants").
The Letter Agreement provides, among other things, that upon
completion of the Proposed Transaction, the FS Warrants will be
cancelled and the Issuer will issue a new warrant to each of FSEP
III and FSEP International, which warrants will expire on August
27, 2007 and, collectively, be exercisable for a number of shares
of Common Stock equal to the number that represents the same
percentage of the total outstanding shares of Common Stock
immediately after the consummation of the Proposed Transaction as
the FS Warrants were entitled to immediately prior to the
consummation of the Proposed Transaction.
Freeman serves on the Issuer's Board of Directors.
The Reporting Persons have been advised that the Other Parties
originally acquired the shares of Common Stock beneficially owned
by them as follows. Wirta acquired beneficial ownership over
(i) 577,526 shares of the Common Stock pursuant to an option and
warrant granted by Koll Holding and (ii) 70,000 shares of the
Common Stock in his capacity as an officer and director of the
Issuer. White acquired beneficial ownership over 125,200 shares
of the Common Stock in his capacity as an officer and director
of the Issuer. Malek received the shares beneficially owned by
him as an investor in the Issuer, in subsequent purchases, and
in his capacity as a director of the Issuer.
Malek, White and Wirta serve on the Issuer's Board of Directors.
Other than as described above in Item 3 and this Item 4, none of
the Reporting Persons have, and the Reporting Persons have been
advised by the BLUM Parties, the FS Parties
<PAGE>
and the Other Parties that none of the BLUM Parties, the FS Parties
or the Other Parties, respectively, have, any plans or proposals
which relate to or would result in any of the matters described in
subparagraphs (a) through (j) of Item 4 of Schedule 13D (although
they reserve the right to develop such plans).
The information set forth in response to this Item 4 is qualified
in its entirety by reference to the Letter Agreement (attached
hereto as Exhibit 1) and the Proposal Letter (attached hereto as
Exhibit 2), each of which is expressly incorporated herein by
reference.
Item 5. Interest in Securities of the Issuer.
(a), (b) The Reporting Persons believe that there are currently
21,213,928 shares of Common Stock outstanding. Koll Holding owns
1,132,886 shares of the Common Stock (the "Koll Shares"), which
include 398,596 shares of Common Stock underlying stock options
and warrants which are currently exercisable or will become
exercisable within 60 days after November 10, 2000. As described
below in Item 6, Koll Holding has granted an option and warrant to
Wirta exercisable for up to 577,526 shares of the Koll Shares.
Under the option agreement, Koll Holding presently has no right to
dispose of the shares subject to the option, although it retains
voting power over the shares. Koll Holding is wholly owned by
Koll Co., which is wholly owned by the Koll Trust, of which Koll
is the sole trustee. As such, each of the Reporting Persons is
deemed to beneficially own all of the Koll Shares. Based on the
assumption that there are 21,213,928 shares of Common Stock
outstanding, these holdings constitute approximately 5.3% of the
Common Stock.
As a result of the matters described in Items 2, 3 and 4 above,
the Reporting Persons together with the BLUM Parties, the FS
Parties and the Other Parties may be deemed to constitute a group
within the meaning of Section 13(d)(3) of the Exchange Act and the
Reporting Persons may be deemed to have acquired beneficial
ownership of the shares of Common Stock owned or deemed to be
beneficially owned by the BLUM Parties, the FS Parties and the
Other Parties.
The Reporting Persons have been advised that based on the
assumption that there are 21,213,928 shares of Common Stock
outstanding, (i) Strategic reports direct holdings of 2,345,900
shares of the Common Stock (11.1%), and (ii) BLUM LP and RCBA Inc.
report holdings of 1,077,986 shares of the Common Stock (5.1%)
owned directly by BLUM LP or the limited partnerships for which
BLUM LP serves as the general partner and BLUM LP's investment
advisory accounts.
As a result of the matters described in Items 2, 3 and 4 above,
Newco, which was formed by Strategic, may be deemed to have
acquired beneficial ownership of the shares of Common Stock owned
or deemed to be owned by the Reporting Persons.
The Reporting Persons have been advised that based on the
assumption that there are 21,213,928 shares of Common Stock
outstanding, (i) FSEP III, FS Capital and FS Holdings each is
deemed to beneficially own 3,278,448 shares (15.5%) of the Common
Stock, (ii) FSEP International, FS&Co. International and
International Holdings each is deemed to beneficially own 124,015
shares (less than 1%) of Common Stock and (iii) Freeman, Spogli,
Wardlaw,
<PAGE>
Simmons, Roth and Rullman each is deemed to beneficially
own 3,402,463 shares (16.0%) of the Common Stock. The Reporting
Persons have been further advised that, as directors, executive
officers and shareholders of FS Holdings and International
Holdings, Freeman, Spogli, Wardlaw, Simmons, Roth and Rullman may
be deemed to be the beneficial owners of the securities
beneficially owned by FS Holdings and International Holdings.
The Reporting Persons have been advised that Wirta currently owns
70,000 shares of Common Stock which includes 35,000 shares of
Common Stock underlying stock options which are currently
exercisable or which become exercisable within 60 days after
November 10, 2000. In addition, as described below in Item 6,
Wirta holds an immediately-exercisable option to purchase 521,590
shares of Common Stock, and warrants to acquire 55,936 shares of
Common Stock, from Koll Holding. As such, Wirta is deemed to
beneficially own 647,526 shares of Common Stock, which constitute
approximately 3.1% of the Common Stock.
The Reporting Persons have been advised that White beneficially
owns 125,200 shares of Common Stock which includes 66,600 shares
of Common Stock underlying stock options which are currently
exercisable or which become exercisable within 60 days after
November 10, 2000. These holdings constitute less than one
percent of the Common Stock.
The Reporting Persons have been advised that Malek beneficially
owns 409,984 shares of Common Stock which includes 12,110 shares
of Common Stock underlying stock options which are currently
exercisable or which become exercisable within 60 days after
November 8, 2000. These holdings constitute approximately 1.9%
percent of the Common Stock.
The Reporting Persons have been advised that, except as
disclosed in this Schedule 13D, each of the Other Parties has
sole power (and does not share any power) to vote or direct the
vote of all shares of Common Stock beneficially owned by him or
it and has sole power (and does not share any power) to dispose
or to direct the disposition all shares of Common Stock
beneficially owned by him or it.
Other than as set forth above, the Reporting Persons have been
advised by the BLUM Parties, the FS Parties and the Other Parties
that, as of November 8, 2000, none of the BLUM Parties, the FS
Parties or the Other Parties, respectively, beneficially owns any
shares of any class of capital stock of the Issuer.
(c) None of the Reporting Persons has effected any transactions
in any shares of Common Stock during the 60-day period ended
November 9, 2000 except as disclosed in this Schedule 13D.
The Reporting Persons have been advised by the Blum Parties, the
FS Parties and the Other Parties that none of the Blum Parties,
the FS Parties or the Other Parties, respectively, has effected
any transactions in any shares of Common Stock during the 60-day
period ended November 10, 2000, except as disclosed in this
Schedule 13D.
(d) No one other than the Reporting Persons has the right to
receive, or the power to direct the receipt of, dividends from, or
the proceeds from the sale of, any of the securities of the Issuer
acquired by the Reporting Persons as described in Item 5. The
Reporting Persons have been advised that no person other than the
BLUM Parties, the FS Parties and the Other Parties has the right
to receive or the power to direct the receipt of dividends from,
or the proceeds from
<PAGE>
the sale of, the shares of Common Stock beneficially owned by the
BLUM Parties, the FS Parties or the Other Parties, respectively,
as described above.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships
With Respect to Securities of the Issuer.
On August 27, 1997, in connection with the merger of KRES into a
wholly-owned subsidiary of the Issuer in exchange for shares of
the Common Stock and warrants to acquire additional shares of the
Common Stock (as described above in Item 4), Koll Co., Koll
Holding and KRES entered into an Amended and Restated Option
Agreement ("Option Agreement") with Wirta (attached hereto as
Exhibit 3), pursuant to which an option previously granted to
Wirta to purchase 672,000 shares of KRES common stock was
converted into (i) an immediately-exercisable option ("Option") to
purchase up to 521,590 shares of the Common Stock from Koll
Holding at an exercise price of $5.84 and (ii) the right to obtain
in connection with each exercise of such Option .1072413 warrants
per share of Common Stock rounded to the nearest warrant, for a
maximum of 55,936 shares of the Common Stock. The exercise period
for the Option and warrants currently extends to May 30, 2004.
Under the Option Agreement, Koll Holding may not sell any shares
of the Common Stock or exercise or transfer any warrants to
acquire the Common Stock if as a result of such sale, exercise or
transfer Koll Holding will not retain a sufficient number of
shares of Common Stock and warrants to permit Wirta to exercise
his rights in full under the Option Agreement. There are no
voting restrictions on the shares prior to exercise of the Option
and warrant.
As described in Item 3 of this Schedule 13D, the Letter Agreement
(attached hereto as Exhibit 1) sets forth certain understandings
among Koll Holding, Strategic, FSEP III, FSEP International and
the Other Parties with respect to the Proposed Transaction
including, among other things, the negotiation of the Proposed
Transaction, the contribution of equity, a stockholders agreement,
agreements with management and employees, exclusivity and voting
and fees and expenses. The consummation of the equity
contributions and the entering into of a stockholders agreement
and the agreements with management and employees are conditioned
upon the prior negotiation and execution of a definitive merger
agreement for the Proposed Transaction and other definitive
documentation.
Annex B to the Letter Agreement sets forth the understandings
between such persons with respect to their ownership of Common
Stock in the event that the Proposed Transaction is consummated,
including without limitation as to restrictions on transfer, co-
sale/tag along rights, right of first offer, preemptive rights,
sale of Issuer, an initial public offering of the Issuer,
registration rights, voting, representation on the Issuer's Board
of Directors, advisory assistance, general consent rights, consent
rights of FSEP III and FSEP International, information and
inspection rights and indemnification.
As described in Item 4 of this Schedule 13D, the Proposal Letter
(attached hereto as Exhibit 2) contains the proposal by Newco to
the Issuer with respect to the Proposed Transactions, including
with respect to the Issuer a discussion of, among other things,
the purchase price, the equity financing, the debt financing, the
structure, the treatment of existing
<PAGE>
indebtedness, the employees, the headquarters and the legal
documentation and conditions regarding the Proposed Transaction.
The descriptions of the Letter Agreement and the Proposal Letter
contained in this Schedule 13D are qualified in their entirety by
reference, respectively, to the Letter Agreement (attached hereto
as Exhibit 1) and the Proposal Letter (attached hereto as Exhibit
B).
None of the Reporting Persons or, to the best knowledge of the
Reporting Persons, the BLUM Parties, the FS Parties, the Other
Parties or other persons named in Item 2 is a party to any
contract, arrangement, understanding or relationship with respect
to any securities of the Issuer, including but not limited to the
transfer or voting of any securities of the Issuer, finder's fees,
joint ventures, loan or option arrangements, puts or calls,
guarantees of profits, division of profits or loss, or the giving
or withholding of proxies, except as previously disclosed.
Item 7. Material to be Filed as Exhibits
1. Letter agreement dated November 10, 2000 among Koll Holding,
Strategic, FSEP III, FSEP International and the Other Parties.
2. Proposal Letter dated November 10, 2000.
3. Amended and Restated Option Agreement dated August 27, 1997
among Koll Co., Koll Holding, Wirta and KRES.
4. Joint Filing Agreement dated November 15, 2000 among the
Reporting Persons.
<PAGE>
SIGNATURES
After reasonable inquiry and to the best of our knowledge and
belief, the undersigned certify that the information set forth in
this statement is true, complete and correct.
Dated: November 15, 2000
DONALD M. KOLL, an individual
/s/ Donald M. Koll
------------------------------
KOLL SEPARATE PROPERTY TRUST
u/d/t April 8, 1999
By: /s/ Donald M. Koll
--------------------------
Donald M. Koll
Trustee
THE KOLL COMPANY, a California
corporation
By: /s/ Donald M. Koll
--------------------------
Donald M. Koll
Chairman of the Board and
Chief Executive Officer
THE KOLL HOLDING COMPANY
By: /s/ Donald M. Koll
--------------------------
Donald M. Koll
President
<PAGE>
