SECURITIES AND EXCHANGE COMMISSION Washington, DC 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): April 14, 2000 ---------------------------------------------------- THE RANDERS KILLAM GROUP INC. (Exact name of Registrant as specified in its charter) Delaware 0-18095 38-2788025 (State or other jurisdiction of (Commission (I.R.S. Employer incorporation or organization) File Number) Identification Number) 27 Bleeker Street Milburn, New Jersey 07041 (Address of principal executive offices) (Zip Code) Registrant's telephone number including area code: (781) 622-1000 FORM 8-K THE RANDERS KILLAM GROUP INC. Item 2. Disposition of Assets On April 14, 2000, BAC Killam, Inc. (the "Business"), an indirect wholly owned subsidiary of The Randers Killam Group Inc. (the "Company"), sold all of its assets to Hatch Mott McDonald, Inc. (the "Buyer"). The BAC Killam, Inc. subsidiary provides both private and public sector clients with a broad range of consulting services that address transportation planning and design. The assets sold in the transaction include all tangible personal property of the Business located at the Business's Buffalo, New York; Queensboro, New York; and Milburn, New Jersey, offices, as well as all rights under certain ongoing consulting contracts, and the rights to "Bettigole Andrews and Clark" and "NH Bettigole" names used by the Business. The Buyer assumed all liabilities and obligations under the assumed contracts that arise after the closing and all liabilities and obligations relating to certain real property leases. The purchase price for the assets was $3 million of which approximately $1.4 million was paid in cash at the closing and of which the balance represents accounts receivable of the Business that will be collected by the Buyer and be paid to the Company upon collection (less a five percent collection fee). The purchase price of the assets was determined by the parties in arms-length negotiations. 2 FORM 8-K THE RANDERS KILLAM GROUP INC. Item 7. Financial Statements, Pro Forma Condensed Financial Information and Exhibits (a) Financial Statements Not applicable. (b) Pro Forma Condensed Financial Statements The following unaudited pro forma condensed statements of operations set forth the results of operations for the fiscal year ended April 3, 1999, and the nine months ended January 1, 2000, as if the disposition by the Company of BAC Killam had occurred at the beginning of fiscal 1999. The unaudited pro forma condensed balance sheet sets forth the financial position as of January 1, 2000, as if the disposition had occurred as of that date. The pro forma results of operations are not necessarily indicative of future operations or the actual results that would have occurred had the sale of BAC Killam been consummated at the beginning of fiscal 1999. These statements should be read in conjunction with the accompanying notes herein and the historical consolidated financial statements and related notes of the Company included in its Annual Report on Form 10-K, as amended, for the fiscal year ended April 3, 1999, and Quarterly Report on Form 10-Q for the nine months ended January 1, 2000. 3 FORM 8-K THE RANDERS KILLAM GROUP INC. PRO FORMA CONDENSED STATEMENT OF OPERATIONS Fiscal Year Ended April 3, 1999 (Unaudited) The Randers Less: Pro Forma Killam Group BAC Killam Adjustments Pro Forma (In thousands except per share amounts) Revenues $ 80,773 $12,158 $ - $ 68,615 -------- ------- ------- -------- Costs and Operating Expenses: Cost of revenues 61,754 10,474 - 51,280 Selling, general, and administrative expenses 13,816 2,890 - 10,926 -------- ------- ------- -------- 75,570 13,364 - 62,206 -------- ------- ------- -------- Operating Income (Loss) 5,203 (1,206) - 6,409 Interest Income 652 9 75 718 Interest Expense (155) - - (155) -------- ------- ------- -------- Income (Loss) Before Income Tax Provision 5,700 (1,197) 75 6,972 Income Tax Provision (Benefit) 2,732 (440) 26 3,198 -------- ------- ------- -------- Net Income (Loss) $ 2,968 $ (757) $ 49 $ 3,774 ======== ======= ======= ======== Basic and Diluted Earnings per Share $ .12 $ .15 ======== ======== Weighted Average Shares: Basic 25,429 25,429 ======== ======== Diluted 25,452 25,452 ======== ======== 4 FORM 8-K THE RANDERS KILLAM GROUP INC. PRO FORMA CONDENSED STATEMENT OF OPERATIONS Nine Months Ended January 1, 2000 (Unaudited) The Randers Less: Pro Forma Killam Group BAC Killam Adjustments Pro Forma (In thousands except per share amounts) Revenues $ 52,209 $ 8,598 $ - $ 43,611 -------- ------- ------- -------- Costs and Operating Expenses: Cost of revenues 38,417 6,679 - 31,738 Selling, general, and administrative expenses 9,172 1,368 - 7,804 Restructuring costs 17,939 9,569 - 8,370 -------- ------- ------- -------- 65,528 17,616 - 47,912 -------- ------- ------- -------- Operating Loss (13,319) (9,018) - (4,301) Interest Income 708 3 58 763 Interest Expense (95) - - (95) -------- ------- -------- -------- Loss Before Income Tax Provision (12,706) (9,015) 58 (3,633) Income Tax Provision (Benefit) 291 (443) 20 754 -------- ------- ------- -------- Net Loss $(12,997) $(8,572) $ 38 $ (4,387) ======== ======= ======= ======== Basic and Diluted Loss per Share $ (.51) $ (.17) ======== ======== Basic and Diluted Weighted Average Shares 25,432 25,432 ======== ======== 5 FORM 8-K THE RANDERS KILLAM GROUP INC. PRO FORMA CONDENSED BALANCE SHEET As of January 1, 2000 (Unaudited) The Randers Less: Pro Forma Killam Group BAC Killam Adjustments Pro Forma (In thousands) ASSETS Current Assets: Cash and cash equivalents $ 2,084 $ 200 $ 1,374 $ 3,258 Advance to affiliate 19,030 - - 19,030 Accounts receivable, net 11,309 1,598 - 9,711 Unbilled contract costs and fees 7,842 1,091 - 6,751 Prepaid taxes and deferred tax asset 1,550 - - 1,550 Prepaid expenses 242 9 - 233 ------- -------- ------- -------- 42,057 2,898 1,374 40,533 ------- -------- ------- -------- Property, Plant, and Equipment, at Cost, Net 9,756 443 - 9,313 ------- -------- ------- -------- Other Assets 1,930 - - 1,930 ------- -------- ------- -------- Cost in Excess of Net Assets of Acquired Companies 31,195 - - 31,195 ------- -------- ------- -------- $84,938 $ 3,341 $ 1,374 $ 82,971 ======= ======== ======= ======== 6 FORM 8-K THE RANDERS KILLAM GROUP INC. PRO FORMA CONDENSED BALANCE SHEET (continued) As of January 1, 2000 (Unaudited) The Randers Less: Pro Forma Killam Group BAC Killam Adjustments Pro Forma (In thousands) LIABILITIES AND SHAREHOLDERS' INVESTMENT Current Liabilities: Current maturities of long-term obligations $ 82 $ - $ - $ 82 Accounts payable 3,617 - - 3,617 Accrued payroll and employee benefits 2,506 - - 2,506 Accrued income taxes 1,953 - - 1,953 Accrued restructuring costs 2,484 - - 2,484 Other accrued expenses 1,356 - 100 1,456 Due to parent company and affiliated companies 119 - - 119 -------- ------- ------- -------- 12,117 - 100 12,217 -------- ------- ------- -------- Deferred Income Taxes 997 - - 997 -------- ------- ------- -------- Other Deferred Items 1,097 - - 1,097 -------- ------- ------- -------- Long-term Obligations 694 - - 694 -------- ------- ------- -------- Shareholders' Investment: Common stock 3 - - 3 Capital in excess of par value 79,395 - - 79,395 Accumulated deficit (9,365) - (2,067) (11,432) Parent company investment - 3,341 3,341 - -------- ------- ------- -------- 70,033 3,341 1,274 67,966 -------- ------- ------- -------- $ 84,938 $ 3,341 $ 1,374 $ 82,971 ======== ======= ======= ======== 7 FORM 8-K THE RANDERS KILLAM GROUP INC. NOTES TO PRO FORMA CONDENSED FINANCIAL STATEMENTS (Unaudited) Note 1 - Pro Forma Adjustments to Pro Forma Condensed Statements of Operations (In thousands except in text) Fiscal Year Ended Nine Months Ended April 3, 1999 January 1, 2000 Debit (Credit) Interest Income Increase in interest income earned on the $1,374,000 $(75) $(58) of cash paid to the Company by the acquirer for BAC Killam, calculated using the 30-day Commercial Paper Composite Rate plus 50 basis points, or 5.46% in fiscal 1999 and 5.58% in the first nine months of fiscal 2000 ---- ---- Income Tax Provision Increase in the income tax provision as a result of $ 26 $ 20 an increase in interest income calculated at the federal income tax rate of 34% ---- ---- Note 2 - Pro Forma Adjustments to Pro Forma Condensed Balance Sheet (In thousands) January 1, 2000 Debit (Credit) Cash and Cash Equivalents Cash received for sale of assets of BAC Killam $ 1,374 ------- Other Accrued Expenses Estimated accrued transaction costs, including legal fees and other costs for BAC Killam $ (100) ------- Shareholders' Investment Elimination of BAC Killam's equity account and excess $(1,274) of parent company investment in BAC Killam over proceeds from sale ------- 8 FORM 8-K THE RANDERS KILLAM GROUP INC. Item 7. Financial Statements, Pro Forma Condensed Financial Information and Exhibits (continued) (c) Exhibits 2.1Asset Purchase Agreement by and among BAC Killam, Inc. and The Randers Killam Group Inc. (as Sellers) and Hatch Mott McDonald, Inc. (as Buyer), dated as of March 31, 2000. Exhibits to the Agreement have been omitted from the copy of the Agreement filed herewith. Copies of such exhibits will be furnished supplementally to the Commission upon request to the Company. 9 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, on this 28th day of April 2000. THE RANDERS KILLAM GROUP INC. /s/ Theo Melas-Kyriazi Theo Melas-Kyriazi Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)