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                                  UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-K

                  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

     FOR THE FISCAL YEAR ENDED FEBRUARY 28, 1998 Commission File No. 0-17882

                     GZA GEOENVIRONMENTAL TECHNOLOGIES, INC.
             ------------------------------------------------------
             (Exact Name of Registrant as Specified in its Charter)

        Delaware                                         04-3051642
(State of Incorporation)                    (I.R.S. Employer Identification No.)

           320 NEEDHAM STREET, NEWTON UPPER FALLS, MASSACHUSETTS 02164
           -----------------------------------------------------------
           (Address of Principal Executive Offices)         (Zip Code)

       Registrant's telephone number, including area code: (617) 969-0050

           Securities registered pursuant to Section 12(b) of the Act:
                                      None

           Securities registered pursuant to Section 12(g) of the Act:

                               Title of each class
                          ----------------------------
                          Common stock, par value $.01

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.

                      Yes                  No  X
                          ---                 ---

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.  [ ]

Number of Shares of Common Stock
outstanding at May 22, 1998         4,066,968
                                    ---------

The aggregate market value of voting stock of the registrant held by
non-affiliates of the registrant (i.e., stockholders who are not directors or
officers of the registrant and are not otherwise persons who control or are
controlled by or under common control with the registrant) was $17,546,700 as of
May 22, 1998.

                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Annual Report to Stockholders of the registrant for fiscal year
1998 are incorporated by reference in Part II. The registrant intends to file
with the Securities and Exchange Commission a definitive proxy statement for the
Company's 1998 Annual Meeting of Stockholders within 120 days of the end of the
fiscal year ended February 28, 1998. Certain portions of such definitive proxy
statement are incorporated by reference in Part III of this Form 10-K.

                  The Index to Exhibits is located at Page 20.


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                                     PART I
                                     ------

ITEM 1. BUSINESS

GENERAL

GZA GeoEnvironmental Technologies, Inc. ("GZA" or the "Company") provides
geotechnical engineering, environmental consulting, environmental remediation
and information systems and management services to industrial, commercial,
financial, public service and government clients. Geotechnical services involve
the evaluation of soil, rock and groundwater conditions for the design and
construction of buildings, highways, tunnels, dams, piers and other structures.
Environmental services range from the initial assessment and evaluation of
contaminated sites to the design, construction and operation of remediation
systems to treat, control or remove contamination. GZA also helps clients to
plan, coordinate and implement effective environmental and occupational health
and safety management programs. GZA designs and implements environmental health
and safety information management systems, applications and networks focused on
intranet networking platforms. The Company also provides drilling, laboratory
and instrumentation services in support of environmental and geotechnical
activities, and through its Information Systems Division ("ISD"), provides
integrated information management services.

GZA's strategy is to provide vertically integrated services that range from the
identification of a potential problem through the design and implementation of a
solution, although the Company often enters into contracts requiring only one of
its services. Management believes that the Company's ability to combine
environmental, geotechnical and information systems capabilities differentiates
GZA from many of its competitors. Environmental problems frequently involve soil
and groundwater contamination. Often, geotechnical expertise is essential in
developing the best remedial solutions, which may involve excavation and removal
of contaminated soil and groundwater, containment by subsurface and surface
hydraulic barriers, and management of groundwater flow through soil and rock. In
such situations, GZA's geotechnical and environmental personnel work together to
evaluate and develop engineered solutions to environmental problems. The
Company's ISD gives clients greater power and flexibility to control their
operation and comply with complex regulations. Management believes that these
complementary skills enable GZA to offer a broad technical approach and
efficient solutions to clients' problems.

The Company provides services to clients through its subsidiaries and
affiliates. Environmental consulting, environmental remediation, geotechnical
and information management services are performed primarily by GZA
GeoEnvironmental, Inc., and drilling operations are performed primarily by GZA
Drilling, Inc., both of which are wholly owned subsidiaries of the Company.
Certain services in New York are provided by the Company's affiliate,
Goldberg-Zoino Associates of New York, P.C., doing business as GZA
GeoEnvironmental of New York, a professional corporation owned by officers,
directors and stockholders of the Company. Aquaterra Environmental Consultants
Limited, ("Aquaterra") the Company's 50%-owned joint venture in the United
Kingdom, provides environmental services in Europe.

SERVICES

The Company's services can be divided into four broad categories: geotechnical
engineering, environmental consulting, environmental restoration, and
information management services. Any given project may involve activities in
more than one of these categories.


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GEOTECHNICAL ENGINEERING SERVICES

The Company's geotechnical engineers analyze the properties of soil and rock to
develop recommendations and specifications for the design and construction of
structures and civil works projects. Clients include engineers and architects,
construction firms, public agencies, real estate developers and property owners.

SOIL AND ROCK ENGINEERING. GZA provides engineering services for the analysis,
design and construction monitoring of geotechnical construction challenges such
as earthwork, braced excavations, dewatering, slope stability, geosynthetics and
ground improvement.

FOUNDATION ENGINEERING. GZA makes recommendations to other design professionals
concerning foundation design and construction. To formulate its recommendations,
the Company performs geological studies, subsurface exploration and laboratory
testing and analysis to determine the engineering properties of subsurface
materials and to identify related engineering and construction issues.

DAMS. GZA provides consulting, design and inspection services in connection with
new construction and the rehabilitation of concrete and embankment dams, dikes
and levees.

MARINE FACILITIES. GZA provides specialized geotechnical engineering and
structural design for the construction of new marine facilities, both marginal
and off-shore, and the rehabilitation and remediation of existing facilities.

TUNNELS. GZA provides geotechnical engineering for the design and construction
of shafts, tunnels and underground chambers in soil and rock for mass transit
programs, utilities, water supply systems, storm water runoff management
systems, highways and other uses. Services range from geological investigations
and mapping to recommendations for structural design and construction to
installation and monitoring of instrumentation.

TRENCHLESS CONSTRUCTION. GZA helps owners, engineers and contractors make
decisions regarding the use of trenchless construction for utility development
and other projects. Services include equipment applicability evaluations,
subsidence evaluations and groundwater control, and involve use of pipe jacking,
microtunneling and directional drilling.

SERVICES TO CONTRACTORS. GZA assists construction companies with specialized
technical services that deal with design, safety, environmental and quality
control issues. Examples of these services include:

  -  Pile Driving Studies/Testing      -  Vibration/Noise Monitoring
  -  Earthwork Control                 -  Health and Safety Plans
  -  Cofferdam/Underpinning Design     -  Environmental Monitoring and Reporting
  -  Dewatering System Design


ENVIRONMENTAL CONSULTING SERVICES

The Company provides a wide variety of services that deal with environmental
issues, seeking solutions that address regulatory requirements that are
acceptable to clients in terms of both cost and risk.



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ENVIRONMENTAL MANAGEMENT AND REGULATORY COMPLIANCE SERVICES. GZA's integrated
services help clients plan, coordinate and implement effective strategies to
comply with environmental and occupational health and safety regulations.
Services include:

  -  Compliance and Management Systems Audits       -  Strategic Planning
  -  Regulatory Training                            -  ISO 14000 Services
  -  Occupational Health & Safety                   -  Permitting Assistance
  -  Wastewater Management                          -  Air Quality Engineering
  -  Solid and Hazardous Waste Management           -  Environmental Information
  -  Pollution Prevention                              Management
  -  Raw Materials Storage and Management           -  Community Relations

ENVIRONMENTAL INVESTIGATIONS OF CONTAMINATED SITES AND FACILITIES. GZA performs
all aspects of environmental investigations for projects ranging from Superfund
sites to individual leaking underground storage tanks. Services include:

  -  Hydrogeologic and Remedial Studies
  -  Facility Evaluation and Voluntary Corrective Actions
  -  Feasibility Studies and Remedial Design

RISK ASSESSMENT. GZA helps clients evaluate environmental data and quantify
potential risks posed to human or ecological receptors. Services include:

  -  Human Health and Ecological Risk Assessment
  -  Development of Risk-Based Cleanup Levels

NATURAL RESOURCE EVALUATION AND PERMITTING. GZA identifies potential risks posed
to natural resources and develops solutions that are environmentally acceptable
and economically viable. Environmental, geotechnical and civil engineering
services include:

  -  Water Resource Evaluation and Aquifer Protection
  -  Erosion Control and Stormwater Management
  -  Wildlife and Aquatic Habitat Evaluation
  -  Wetland Impact Assessment and Mitigation Design

PROPERTY TRANSFER STUDIES/ENVIRONMENTAL SITE ASSESSMENTS. GZA helps clients
assess risks associated with the purchase or management of real estate and
businesses. Services include:

  -  Phase I and Phase II Environmental Site and Physical Condition Assessments
  -  Regulatory Compliance Audits of Operating Facilities

WATER RESOURCES ASSESSMENTS. GZA conducts water quality and benthic condition
surveys of reservoir and riverine systems, physical condition assessments for
dams and pumping networks associated with water supply facilities, and dredge
materials management investigation related to navigation channels.



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SOLID WASTE MANAGEMENT SERVICES. GZA assists the owners and operators of
transfer stations and landfills in the siting, design, construction, operation,
maintenance, remediation, and closure of facilities. Services include:

  -  Feasibility Studies                        -  Construction Management and
  -  Environmental Impact Studies                  Quality Inspection/Testing
  -  Geologic and Hydrogeologic Evaluations     -  Facility Operation
  -  Permitting                                 -  Closure/Post Closure
  -  Facility Design                            -  Environmental Remediation

ENVIRONMENTAL RESTORATION SERVICES

GZA provides engineering, construction and construction management services to
help clients locate, identify and remediate environmental contamination. GZA can
design and implement its own restoration plan or construct and operate cleanup
systems designed by others.

DESIGN AND CONSTRUCTION OF ENVIRONMENTAL TREATMENT SYSTEMS. GZA performs some or
all aspects of design, construction, installation, and start-up of remedial
treatment systems. These systems utilize remediation techniques such as: soil
stabilization/fixation, soil vapor extraction, counter-current aeration, carbon
absorption, thermal desorption and bioremediation. Remote monitoring, operation
and control using radio, dial-up and web-based information systems add value to
GZA remedial designs.

OPERATION AND MAINTENANCE SERVICES. GZA provides traditional and remote
telemetry-based operation and maintenance services for treatment systems as well
as performance evaluations, including periodic sampling and analyses of
contaminants to monitor cleanup progress.

DESIGN AND CONSTRUCTION OF CONTAINMENT SYSTEMS. GZA designs and constructs
containment systems, using a variety of techniques to physically isolate
contaminants from the surrounding environment.

HAZARDOUS MATERIALS MANAGEMENT. GZA acts as a general contractor on assignments
where the chosen remedial alternative is removal and off-site disposal of
hazardous or contaminated material. GZA oversees excavation, performs testing
and waste characterization, evaluates and monitors transportation and disposal
vendors, and assists with administration and regulatory compliance.

REMOVAL OR REPLACEMENT OF TANKS AND PIPING SYSTEMS. GZA provides underground
storage tank testing and assessment; regulatory compliance audit and planning
services; and management of tank or piping upgrade, removal and installation.

ASBESTOS AND LEAD MANAGEMENT AND ABATEMENT. GZA provides a variety of services
including asbestos survey and lead risk assessments, management of the abatement
process, air quality monitoring and development and periodic review of asbestos
management programs.

FACILITY CLOSURE AND RESTORATION. GZA provides integrated remediation services
to clients that are closing facilities and/or restoring contaminated sites for
redevelopment. Multi-phase services include environmental assessments,
cost-benefit analysis and remedial design and construction management.
Applications include facility/equipment decontamination and decommissioning as
well as lagoon and landfill closures. Projects can be delivered via conventional
owner, engineer, contractor, contractual relationships and design-remediate
project delivery mechanisms that include fixed price to closure agreements.



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INFORMATION MANAGEMENT SERVICES

The Company's ISD develops and delivers information management solutions to
clients, as well as administers the Company's internal information management
strategy. This division complements and enhances the Company's traditional role
as a services firm, largely in the business of acquiring, accumulating and
processing data, and presenting information to, or on behalf of, its clients.
ISD's approach to information management combines the latest information
technology, the communication and computing power of internal information
systems (intranets), the resources of the Internet and sound principles of the
strategic use of information. Information-related services and systems that
GZA's ISD provides to its clients include: 1) services and products that enhance
the ability of a client to utilize data within its own organization and improve
operational and management efficiency, particularly in the area of environmental
and health and safety information management, 2) services and products that
enhance communication between GZA and its client and 3) services and products
that enhance communication between a client and the outside world, including
buyers of the client's products. GZA's products and services are primarily
web-enabled applications that enhance the client's use of the Internet and
intranets.

Examples of these applications include the following:

CustomerLink(SM). CustomerLink(SM) is a web-based application that allows
clients to access information concerning their projects that is maintained on
GZA's systems. Through CustomerLink(SM), clients enter a secure on-line
environment where they can access electronic file cabinets of project-specific
information or collaborate with their project teams. This allows them to
directly participate in their projects from anywhere in the world.

Safety/Health Incident Tracking System. The Safety/Health Incident Tracking
System simplifies and automates the recording, tracking, analysis and reporting
of work-related illness and injury incident information. This web-based
application allows personnel designated by the client to enter plant-specific
incident data on-line, which can be used to update a central database at the
client's facility or at its corporate headquarters. The database produced by the
system complies with OSHA 101 data collection requirements and provides a
variety of other time-saving features.

InfoLink(SM). InfoLink(SM) is a web-based environmental information management
system designed to simplify and streamline environmental health and safety
information management reporting. A modular suite of easily customized
applications that are deployed according to a client's specific needs and
priorities, InfoLink(SM) modules include MSDS Management, Safety/Health Incident
Tracking, Chemical Tracking and Reporting, Employee Training Management, Storage
Tank Management and IS014000 Environmental Management, as well as other custom
applications.

SUPPORT SERVICES

To support its services to clients, GZA maintains a geotechnical instrumentation
group, an environmental laboratory, a geotechnical laboratory and a drilling
operation. Management believes that internal availability of these support
services enables the Company to control quality and to provide faster results
than could generally be obtained from independent commercial providers of such
services.

GEOTECHNICAL INSTRUMENTATION. GZA's Soil and Rock Instrumentation Division
("SRI") supports the Company's geotechnical and environmental projects, and also
provides specialty geotechnical instrumentation and engineering services to the
heavy construction industry and other clients. SRI maintains an instrumentation
laboratory and a fabrication shop. On geotechnical projects, SRI designs,
installs and monitors instruments to observe excavation support systems,
tunnels, and deep foundations during construction. On environmental projects,
SRI performs automated pump tests to determine aquifers characteristics. SRI
also works with ISD and develops web-based applications and custom software to
be used in automatic data acquisition systems for dams and construction projects
in which rapid collection and analysis of data are required.



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LABORATORIES. GZA's Environmental Chemistry Laboratory analyzes soil, water, air
and waste samples in connection with GZA's environmental studies. GZA's Mobile
Laboratory and Vibratory Drill Rigs provide field sampling and small diameter
well installation as well as on-site, real-time chemical analyses. GZA's
Geotechnical Laboratory performs analyses to determine the permeability,
strength, compressibility and other engineering properties of rock cores and
soil samples. The Geotechnical Laboratory also determines geomembrane seam
strength as well as frictional resistance between geomembranes and soils or
other geosynthetics.

DRILLING. GZA performs drilling, sampling and installation of monitoring and
recovery wells for clients that have engaged GZA to provide other services for
other contractors and for government agencies. Drilling to obtain samples
usually forms part of the subsurface investigation phase of both environmental
and geotechnical projects. The drilling operation also provides dewatering and
pump testing support services.

JOINT VENTURE
-------------

AQUATERRA (U.K.)

In 1991, the Company entered into a joint venture with Carl Bro Group (U.K.)
Limited ("CarlBro") to form Aquaterra Environmental Consultants Limited, a
limited liability company whose stock is owned equally by the Company and Carl
Bro. Originally located in Leeds, Great Britain, Aquaterra has recently expanded
to London and Edinburgh where it provides services related to contaminated land
and groundwater and to environmental concerns of operating facilities as well as
geotechnical engineering.

CUSTOMERS
---------

The Company's client base includes industrial companies, owners and operators of
solid waste landfills, real estate developers, architects and engineers,
construction firms, parties to property transfers and financings (lenders, law
firms, corporations and developers) and public agencies. The Company derives
most of its revenues from the private sector, which accounted for approximately
82% of net revenues during the past year.

In fiscal year 1998, the Company was actively engaged in approximately 3,500
assignments for approximately 1,700 clients. These assignments ranged from brief
projects (of one month or less) such as environmental site assessments and
geotechnical foundation evaluations to long-term projects such as multi-year
hazardous waste cleanups and geotechnical infrastructure projects. Most of the
Company's assignments were short-term (less than six months in duration), and
management estimates that 40% of net revenues in fiscal 1998 were derived from
projects for which net revenues were $50,000 or less. In fiscal year 1998, no
one customer accounted for more than 10% of the Company's net revenues.

BACKLOG
-------

As of April 30, 1998 the Company had a backlog of orders it believed to be firm
of approximately $26 million. This amount includes estimated amounts under
orders on a time and materials, unit price or other basis without a fixed price,
and represents gross revenues, including cost of services and materials
subcontracted to third parties. Backlog at April 30, 1998 excludes the value of
government contracts that have been awarded but have not yet been executed
and/or funded, as well as the value of contract options that have not yet been
exercised. As of April 30, 1997, the Company had a backlog of orders calculated
on same basis of approximately $29 million. Because work under the Company's
orders can in general be terminated by the client at any time, there is no
assurance that all the amounts included in backlog will ultimately be realized,
even if covered by written contracts or task orders.



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COMPETITION
-----------

The markets for environmental and geotechnical services have become increasingly
competitive. At each district office and for each service offered, the Company
competes with many different firms, ranging from small local firms to large
regional and national firms having substantially greater financial and marketing
resources than the Company. Competition in both the environmental and
geotechnical services markets is based primarily on quality, diversity of
services, geographic location, price and reputation. In some geographic markets,
GZA provides environmental engineering and consulting, geotechnical engineering
design and contractor support services. Some state and local statutes and
regulations may inhibit the Company's ability to compete for construction work
in areas at or near sites where the Company has formerly provided engineering or
design services. Management believes the Company is one of a few firms that
offers a combination of environmental consulting, remediation, geotechnical
engineering with integrated information management services. Management believes
that its ability to provide this range of services enhances the Company's
competitive position in its market areas.

IMPACT OF ENVIRONMENTAL REGULATION
----------------------------------

The business of the Company and its clients are subject to a wide range of
overlapping federal, state and local laws and regulations concerned with
protection of the environment. These laws and regulations have helped to create
a demand for many of the services offered by the Company. Changes in
environmental laws and regulations, in the regulatory climate generally, and in
the resources available to and priorities of the federal, state and local
agencies responsible for enforcement of environmental laws and regulations could
materially affect demand for the Company's services.

Reductions of the budgets of the U.S. Environmental Protection Agency ("EPA"),
Department of Defense ("DOD") and ongoing legislative proposals to narrow the
scope of the federal Superfund and Clean Water Acts, and delays in EPA rule
making could result in reduced demand for the Company's services. Conversely,
regulatory reform initiatives designed to shift responsibility for environmental
compliance and enforcement from government agencies to private parties could
create new opportunities for the Company. Such privatization initiatives have
been taken in Massachusetts and Connecticut where, under a statute analogous to
the federal Superfund Act, supervision of the clean-up of contaminated sites has
for the most part been delegated by state regulatory officials to "Licensed Site
Professionals" or "Licensed Environmental Professionals" employed by private
entities. The Company employs a number of individuals qualified and licensed in
these and other states in which the Company provides services. Regulatory reform
initiatives may also reduce the cost of environmental cleanups and therefore may
activate private remediation projects that have been pending. Whether such
initiatives will lead to an increased need for the Company's services is not yet
known, and there can be no assurance that changes in the regulatory climate and
in environmental statutes and regulations will not result in reduced demand for
such services.

The principal statutes affecting the Company's business and the markets it
serves include the following:

RESOURCE CONSERVATION AND RECOVERY ACT OF 1976 ("RCRA"). RCRA, as amended by the
Hazardous and Solid Waste Amendments of 1984, establishes a comprehensive
regulatory scheme for the handling, transportation, treatment, storage and
disposal of hazardous waste. Although "cradle-to-grave" responsibility for
hazardous wastes rests with generators of the material, every facility that
treats, stores or disposes of specified minimum amounts of hazardous waste must
comply with specific operating, design, financial responsibility and closure
requirements. These requirements have contributed to demand for the Company's
consulting services, permitting assistance, remedial design and implementation
and waste management services.

COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION AND LIABILITY ACT OF 1980
("CERCLA" OR "SUPERFUND"). CERCLA, as amended by the Superfund Amendments and
Re-authorization Act of 1986 ("SARA"), addresses problems created by past
handling and disposal of hazardous substances. It requires the EPA to identify



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contaminated sites and to compel a wide array of "responsible parties" to pay
for necessary cleanup activities. CERCLA also authorizes multiple damages and
penalties for non-compliance with EPA orders and provides funds (hence the name
"Superfund") for the EPA to perform cleanup activities in appropriate
circumstances. The Company's related services include site investigations,
feasibility studies, development and implementation of alternative remediation
plans, oversight of contractors and support and expert testimony for related
litigation.

FEDERAL WATER POLLUTION CONTROL ACT OF 1972 (THE "CLEAN WATER ACT"). The Clean
Water Act establishes a system of standards, permits and enforcement procedures
for the discharge to water of pollutants from industrial and municipal sources.
The law sets treatment standards for industries and wastewater treatment plants.
The law also regulates and requires permits for development and construction
activities involving wetlands and navigable waters. The Company provides a range
of services in connection with this regulatory scheme, including regulatory
permitting assessments, conceptual design planning, assistance with
environmental impact studies, reports and applications for environmental permits
and construction services.

CLEAN AIR ACT AMENDMENTS OF 1990 (THE "CLEAN AIR ACT"). The Clean Air Act
consists of major initiatives to attain and maintain National Ambient Air
Quality Standards, to ensure that all new sources of potential atmospheric
emissions are equipped with appropriate pollution control technology and to
ensure that emissions of hazardous air pollutants are controlled to the maximum
extent possible. The law established a comprehensive new operating permit
program known as the Title V program. The Company provides a range of air
quality services including emission inventories and preparation of permit
applications.

OTHER REGULATIONS. In addition to federal environmental regulations, many states
and local authorities have enacted laws regulating activities affecting the
environment, some of which impose differing, and sometimes stricter, standards
than their federal counterparts. Examples include a variety of statutes related
to "Brownfields" initiatives. Brownfields are abandoned or underutilized
properties where actual or perceived contamination may interfere with
redevelopment. Many states are encouraging reuse of such sites through the
promulgation of regulations that establish clean-up standards based on current
risks and reasonably foreseeable future site use, rather than theoretical risks
and unlikely end uses that always require "clean closure" prior to
redevelopment. Some states may also provide covenants not to sue or "no further
action required" agreements that document the regulators' acceptance of the
clean-up process. Such covenants and agreements may be transferable with the
property. The Company is working on a number of projects involving Brownfields
sites, providing services ranging from initial investigation through final
construction. The Company is also seeking investments in contaminated property
to apply its remediation experience to produce attractive financial returns
through a limited liability company, or other affiliations with experienced
property developers, the Company is seeking premium returns with controlled
risks.

POTENTIAL LIABILITY, RISK MANAGEMENT AND INSURANCE
--------------------------------------------------

The Company's professional environmental consulting, remediation design and
geotechnical engineering services, as well as its remedial construction,
drilling and test boring operations, involve risks of significant liability for
environmental and property damage, personal injury, economic loss, and costs,
fines and penalties assessed by regulatory agencies. Liability for environmental
contamination and for the provision of environmental services is a rapidly
developing area of the law, and it is difficult to assess accurately the areas
and magnitude of potential risks to the Company.

Some statutes and judicial decisions impose strict liability on a party that
causes or contributes to the release of contaminants into the environment, even
if the party acted without negligence or fault. Under certain circumstances, a
government or private party might allege that the Company's own analytical,
consulting or remedial activities subjected the Company to liability under
various statutes or regulations. Services by the Company's environmental
consultants as Licensed Site and Licensed Environmental Professionals may expose
the Company to additional liability. In addition to



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its potential liability under statutes and common law, the Company sometimes
agrees to indemnify clients for losses and expenses they may incur as a result
of the Company's services, some of which may not be covered by the Company's
insurance.

The Company's information management services also pose risks associated
primarily with systems security.

The Company maintains comprehensive programs for risk management, health and
safety training and medical monitoring of its field employees, quality assurance
and quality control and loss prevention. The Company seeks to include in its
client contracts provisions that limit GZA's liability to the client and that
require the client to indemnify GZA for costs and liabilities not caused by the
Company's negligence or misconduct. However, not all contracts include these
provisions, and there is no assurance that such, provisions can be enforced or
that the client will have adequate financial resources to stand behind its
indemnity.

The Company has a broad-range insurance program with large commercial insurers
designed to limit exposure arising out of its activities. It maintains
comprehensive general, automobile and excess liability coverage with aggregate
limits of $15 million written on an occurrence basis. The Company's property is
insured for loss or damage. It also maintains an environmental professional
liability policy that covers professional liability, contractor's environmental
liability and completed operations, with an aggregate limit of $5 million in
excess of a deductible of $500,000, written on a claims-made basis for
occurrences since 1986. The law concerning the extent of coverage available
under the Company's liability insurance policies in the context of environmental
claims is unsettled and is likely to remain unsettled in the foreseeable future.
All of the Company's policies permit termination by the insurer without cause.
There is no assurance that the Company will be able to maintain or replace its
insurance policies, that premiums will remain at levels that economically permit
the maintenance of such coverage, that all claims that may be asserted against
the Company will be covered by insurance or that such claims will not exceed the
coverage limits.

EMPLOYEES
---------

On April 30, 1998, the Company had 442 employees, including 339 technical
personnel. The Company's technical staff consists of civil and environmental
engineers, geologists, drillers and a number of specialists in such fields as
hydrology, chemistry, toxicology, biology and industrial hygiene. Management
believes that the future success of the Company depends in large part on its
ability to continue to attract and retain qualified professional staff. The
market for such professionals is competitive.

ITEM 2. PROPERTIES

The Company's corporate and administrative headquarters, and one of its district
offices, are located in Newton Upper Falls, Massachusetts, where the Company
occupies two buildings. One of the buildings is approximately 42,000 square feet
and has a lease that extends through February 2001. During fiscal year 1998, the
Company paid approximately $714,000 in base rent for this facility. The other
location in Newton Upper Falls is for approximately 14,000 square feet. In
fiscal year 1998, the Company paid approximately $140,000 in base rent for this
facility.

The Company leases 20 other principal facilities located in: Vernon,
Connecticut; Duluth, Georgia; Portland, Maine; Brockton, Massachusetts; West
Newton, Massachusetts; Worcester, Massachusetts; Livonia, Michigan; Grand
Rapids, Michigan; Manchester, New Hampshire; Wayne, New Jersey; Hammonton, New
Jersey; Buffalo, New York; Great Neck, New York; Rochester, New York; Charlotte,
North Carolina; Coraopolis, Pennsylvania; Providence, Rhode Island; Dallas,
Texas; Rutland, Vermont; and Pewaukee, Wisconsin. These other facilities have a
combined square footage of approximately 98,000 square feet. Aggregate base rent
for all facilities leased by the Company (other than its facilities in Newton
Upper Falls) during fiscal year 1998 totalled approximately $1,193,000. The
lease terms expire at various times through September 30, 2001.



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The Company believes that its existing facilities are adequate to meet current
requirements and that suitable additional or substitute space will be available
on reasonable terms as needed to accommodate any expansion of operations and for
additional offices as required.

In addition to its leasehold interests in real property, the Company also owns
computer equipment, vehicles, drilling rigs, laboratory equipment and
instrumentation, remediation treatment equipment and other machinery, equipment
and furniture.

ITEM 3. LEGAL PROCEEDINGS

The Company is party to several legal proceedings arising in the normal course
of business. Management believes that the outcome of these actions will not,
individually or in the aggregate, have a material adverse effect on the results
of operations or financial condition of the Company.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not Applicable




                                       11
<PAGE>   12

                                     PART II
                                     -------

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

The information appearing under the caption "Supplemental Information" in the
Annual Report to Stockholders of the Company for the fiscal year ended
February 28, 1998 (the "1998 Annual Report"), in the form included as
Exhibit 13.1 to this Annual Report on Form 10-K, is incorporated herein by
reference.

RECENT SALES OF UNREGISTERED SECURITIES. During the three year period ended
February 28, 1998, the Company issued to 18 employees, without registration
under the Securities Act of 1933, as amended (the "Act"), an aggregate of 35,881
shares of the Company's Common Stock ("Restricted Stock") pursuant to the
Company's 1995 Stock Incentive Plan. The Restricted Stock was awarded as
additional compensation in the nature of a bonus, and no separate consideration
was paid by the recipients. The issuances of Restricted Stock were exempt from
the registration requirements of Section 5 of the Act, by virtue of the
exception set forth in Section 4(2) of the Act.

ITEM 6. SELECTED FINANCIAL DATA

The information appearing under the caption "Summary Financial Information" in
the 1998 Annual Report is incorporated herein by reference.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

The information appearing under the caption "Management's Discussion and
Analysis of Financial Condition and Results of Operations" in the 1998 Annual
Report is incorporated herein by reference.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The information appearing under the captions "Consolidated Balance Sheets,"
"Consolidated Statements of Operations," "Consolidated Statements of
Stockholders' Equity," "Consolidated Statements of Cash Flows," and "Notes to
Consolidated Financial Statements" in the 1998 Annual Report is incorporated
herein by reference.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

None

                                    PART III
                                    --------

ITEMS 10, 11, 12 AND 13. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT;
EXECUTIVE COMPENSATION; SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT; AND CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The information called for by Items 10, 11, 12 and 13 is incorporated by
reference to the definitive proxy statement relating to the Annual Meeting of
Stockholders of the Company to be held on July 14, 1998 (the "1998 Proxy
Statement"), to be filed with the Commission no later than 120 days after the
end of the fiscal year covered by this report.



                                       12
<PAGE>   13

                                     PART IV
                                     -------

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 10-K

(a)  Documents filed as part of the report:

     (1) The following consolidated financial statements of GZA GeoEnvironmental
         Technologies, Inc. and its Subsidiaries and Affiliate included in the
         1998 Annual Report are incorporated by reference in Item 8:

            Report of Independent Accountants.

            Consolidated Balance Sheets at February 28, 1998 and 1997.

            Consolidated Statements of Operations for the fiscal years ended
            February 28, 1998, 1997 and February 29, 1996.

            Consolidated Statements of Stockholders' Equity for the fiscal years
            ended February 28, 1998, 1997 and February 29, 1996.

            Consolidated Statements of Cash Flows for the fiscal years ended
            February 28, 1998, 1997 and February 29, 1996.

            Notes to Consolidated Financial Statements for the fiscal years
            ended February 28, 1998, 1997 and February 29, 1996.

     (2) The following consolidated financial statement schedule of GZA
         GeoEnvironmental Technologies, Inc. and its Subsidiaries and Affiliate
         is included in this report:

         Report of Independent Accountants

                                                                       Page
                                                                       ----
         Schedule II     Valuation and Qualifying Accounts              18

     (3) EXHIBITS.

EXHIBIT NO.   DESCRIPTION

3.1*          Restated Certificate of Incorporation of the Company

3.3*          Amended and Restated By-Laws of the Company

4.1*          Specimen certificate for the Common Stock of the Company

10.2*         Indenture of Lease dated September 5, 1984 and effective as of
              December 1, 1981, and First Amendment to Indenture of Leases,
              between GZA and Donald T. Goldberg and William S. Zoino, for the
              GEO Building, Newton Upper Falls, Massachusetts

10.6*         1989 Incentive Stock Option Plan of the Company

10.7*         1989 Non-Qualified Stock Option Plan of the Company




                                       13
<PAGE>   14

10.21*        Support Services Agreement among the Company, Goldberg-Zoino
              Associates of New York, P.C. and GZA, dated July 26, 1989


10.22***      Stockholders' Agreement among GZANY, Richard M. Simon and Joseph
              D. Guertin, Jr. dated May 1, 1996, together with related Powers of
              Attorney

10.23***      Voting Trust Agreement among the Company, GZANY, Messrs. Simon and
              Guertin, and Richard M. Simon, as Trustee, dated May 1, 1996

10.24***      Indemnification Agreement among the Company, GZA GeoEnvironmental,
              Inc. and Messrs. Simon and Guertin dated May 1, 1996

10.25*        Security Agreement between GZANY and the Company dated July
              26,1989

10.26*        Credit Agreement among the Company, GZANY and GZA dated July 26,
              1989

10.30**       Revolving Credit and Term Loan Agreement among Fleet Bank and the
              Company and its subsidiaries and affiliate dated February 28, 1994

10.34**       Amendment No. 1 to 1989 Incentive Stock Option Plan of the Company

10.35**       GZA 1995 Stock Incentive Plan

10.37**       Lease Agreement dated January 1, 1992 between GZRI Associates and
              GZA GeoEnvironmental, Inc. for the Providence, Rhode Island
              district office

10.38**       Lease Agreement dated March 1, 1992 between GZAIAT Associates and
              GZA Drilling, Inc. for the Brockton, Massachusetts facilities of
              GZA Drilling, Inc.

10.39**       Second Amendment dated December 11, 1991 to Indenture of Lease
              listed as Exhibit 10.2 hereto

10.40**       Form of Confidentiality, Non-Disclosure and Restrictive Covenant
              Agreement between the Company and, respectively, Donald T.
              Goldberg, Andrew P. Pajak, M. Joseph Celi, Richard M. Simon, John
              E. Ayres, William E. Hadge, Lawrence Feldman, Joseph P. Hehir,
              Joseph D. Guertin, Jr., and certain other employees

10.42**       Form of Group Life Insurance Plan for key employees; letter
              describing coverage levels

10.43**       Form of Indemnity Agreement between the Company and its respective
              directors

10.51+        Form of Assignment of Beneficial Interest between GZA
              GeoEnvironmental, Inc. ("Assignee") and, respectively, John E.
              Ayres, Joseph D. Guertin, Jr., and Steven J. Trettel
              ("Assignors"), dated June, 1996, to transfer each Assignor's one
              sixth (1/6) beneficial interest in the GZA Investment Associates
              Trust to Assignee

10.52+        Form of Assignment of Beneficial Interest and Indemnity Agreement
              between GZA GeoEnvironmental, Inc. ("Assignee") and Donald T.
              Goldberg ("Assignor"), dated June 1996, to transfer Assignor's one
              sixth (1/6) beneficial interest in the GZA Investment Associates
              Trust to Assignee



                                       14
<PAGE>   15

10.53         Second Loan Modification Agreement, dated as of August 7, 1997, to
              the Revolving Credit and Term Loan Agreement among Fleet Bank and
              the Company and its subsidiaries and affiliate included as Item
              10.30, including a Promissory Note dated August 7, 1997 and a form
              of Promissory Note.

13.1          Annual Report to Stockholders of the Company for the fiscal year
              ended February 28, 1998

22.1          Subsidiaries of the Registrant

23.1          Consent of Independent Accountants

27.1          Financial Data Schedule

27.2          Restated Financial Data Schedule for the fiscal year ended
              February 29, 1996

27.3          Restated Financial Data Schedule for the fiscal year ended
              February 28, 1997

--------------

*    Incorporated by reference to the Company's Registration Statement on Form
     S-1, as amended (File No. 333-29369)
**   Incorporated by reference to the Company's Annual Report on Form 10-K for
     the fiscal year ended February 28, 1995, as filed with the Commission on
     June 12, 1995.
***  Incorporated by reference to the Company's Annual Report on Form 10-K for
     the fiscal year ended February 29, 1996, as filed with the Commission on
     May 24, 1996.
+    Incorporated by reference to the Company's Annual Report on Form 10-K for
     the fiscal year ended February 28, 1997, as filed with the Commission on
     May 29, 1997.

(b)  Reports on Form 8-K: None.




                                       15
<PAGE>   16

                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed in its
behalf by the undersigned, thereunto duly authorized.

                     GZA GEOENVIRONMENTAL TECHNOLOGIES, INC.

Date:  May 27, 1998                                 /s/ Andrew P. Pajak
                                                    -----------------------
                                                    Andrew P. Pajak
                                                    Chief Executive Officer



Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the date indicated.

Signature              Title                                        Date
---------              -----                                        ----

/s/ Andrew P. Pajak     Chief Executive Officer and Director        May 27, 1998
----------------------  (Principal Executive Officer)
Andrew P. Pajak


/s/ Joseph P. Hehir     Chief Financial Officer                     May 27, 1998
----------------------  (Principal Financial and 
Joseph P. Hehir         Accounting Officer)


/s/ Donald T. Goldberg  Director                                    May 27, 1998
----------------------
Donald T. Goldberg


/s/ M. Joseph Celi      Director                                    May 27, 1998
---------------------
M. Joseph Celi


/s/ Joseph D. Guertin   Director                                    May 27, 1998
---------------------
Joseph D. Guertin





                                       16
<PAGE>   17

/s/ William E. Hadge        Director                              May 27, 1998
-------------------------
William E. Hadge


/s/ Dr. Lewis Mandell       Director                              May 27, 1998
-------------------------
Dr. Lewis Mandell


/s/ Dr. Thomas W. Philbin   Director                              May 27, 1998
-------------------------
Dr. Thomas W. Philbin


/s/ Timothy W. Devitt       Director                              May 27, 1998
-------------------------
Timothy W. Devitt




                                       17
<PAGE>   18

                        REPORT OF INDEPENDENT ACCOUNTANTS

In connection with our audits of the consolidated financial statements of GZA
GeoEnvironmental Technologies, Inc. as of February 28, 1998 and 1997 and each of
the three years in the period ended February 28, 1998, we have also audited the
consolidated schedule included in this Annual Report (Form 10-K) for the year
ended February 28, 1998 as listed in Item 14(a)(2).

In our opinion, the consolidated schedule referred to above, when considered in
relation to the basic financial statements taken as a whole, presents fairly, in
all material respects, the information required to be stated therein.

                                                   COOPERS & LYBRAND L.L.P.

Boston, Massachusetts
May 5, 1998




                                       18
<PAGE>   19

                                   SCHEDULE II

              GZA GEOENVIRONMENTAL TECHNOLOGIES, INC. AND AFFILIATE
                        VALUATION AND QUALIFYING ACCOUNTS

                         Years Ended February 29, 1996,
                           February 28, 1997, and 1998

<TABLE>
<CAPTION>
                                      Balance at   Charged to
                                       beginning    costs and                 Balance at
         Description                    of year     expenses    Write-offs   end of year
         -----------                  ----------   ----------   ----------   -----------
<S>                                   <C>          <C>          <C>          <C>

Year ended February 29, 1996
   Allowance for doubtful accounts
   (deducted from accounts
   receivable)......................   $684,000     $240,000     $150,000      $774,000


Year ended February 28, 1997
   Allowance for doubtful accounts
   (deducted from accounts
   receivable)......................   $774,000     $525,000     $455,000      $844,000

Year ended February 28, 1998
   Allowance for doubtful accounts
   (deducted from accounts
   receivable)......................   $844,000     $378,000     $323,000      $899,000
</TABLE>



                                       19
<PAGE>   20

                                  EXHIBIT INDEX
                                  -------------

Exhibit
Number      Description                                                     Page
-------     -----------                                                     ----

10.53       Second Loan Modification Agreement, dated as of August 7,
            1997, to the Revolving Credit and Term Loan Agreement among
            Fleet Bank and the Company and its subsidiaries and affiliate
            included as Item 10.30, including a Promissory Note dated
            August 7, 1997 and a form of Promissory Note.

13.1        Annual Report to Stockholders of the Company for the fiscal
            year ended February 28, 1998

22.1        Subsidiaries of the Registrant

23.1        Consent of Independent Accountants

27.1        Financial Data Schedule

27.2        Restated Financial Data Schedule for the fiscal year ended
            February 29, 1996

27.3        Restated Financial Data Schedule for the fiscal year ended
            February 28, 1997




                                       20