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<SEC-DOCUMENT>0000077551-97-000006.txt : 19970918
<SEC-HEADER>0000077551-97-000006.hdr.sgml : 19970918
ACCESSION NUMBER: 0000077551-97-000006
CONFORMED SUBMISSION TYPE: 10-K
PUBLIC DOCUMENT COUNT: 16
CONFORMED PERIOD OF REPORT: 19970630
FILED AS OF DATE: 19970912
SROS: NYSE
SROS: PSE
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: PERKIN ELMER CORP
CENTRAL INDEX KEY: 0000077551
STANDARD INDUSTRIAL CLASSIFICATION: LABORATORY ANALYTICAL INSTRUMENTS [3826]
IRS NUMBER: 060490270
STATE OF INCORPORATION: NY
FISCAL YEAR END: 0630
FILING VALUES:
FORM TYPE: 10-K
SEC ACT:
SEC FILE NUMBER: 001-04389
FILM NUMBER: 97679771
BUSINESS ADDRESS:
STREET 1: 761 MAIN AVE
CITY: NORWALK
STATE: CT
ZIP: 06859-0001
BUSINESS PHONE: 2037621000
MAIL ADDRESS:
STREET 1: 761 MAIN AVENUE
CITY: NORWALK
STATE: CT
ZIP: 06859-0001
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-K
<SEQUENCE>1
<DESCRIPTION>ANNUAL REPORT ON FORM 10-K
<TEXT>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
[ X ] Annual Report Pursuant To Section 13 Or 15(d)
Of The Securities Exchange Act Of 1934
For the Fiscal Year Ended June 30, 1997
OR
[ ] Transition Report Pursuant To Section 13 Or 15(d)
Of The Securities Exchange Act Of 1934
For the transition period from _______ to __________
Commission File Number 1-4389
The Perkin-Elmer Corporation
(Exact name of registrant as specified in its charter)
NEW YORK 06-0490270
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
761 Main Avenue, Norwalk, Connecticut 06859-0001
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including
area code: 203-762-1000
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of class on which registered
Common Stock (par value $1.00 per share) New York Stock Exchange
Pacific Stock Exchange
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.
X Yes No
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. [X]
As of September 8, 1997, 43,847,333 shares of Registrant's Common
Stock were outstanding, and the aggregate market value of shares of such
Common Stock (based upon the average sales price) held by non-affiliates
was approximately $3,450,237,015.
DOCUMENTS INCORPORATED BY REFERENCE
Annual Report to Shareholders for Fiscal Year ended June 30, 1997
- Parts I, II, and IV.
Proxy Statement for Annual Meeting of Shareholders dated September 8,
1997 - Part III.
<PAGE>
PART I
Item 1. BUSINESS
(a) General Development of Business.
The Perkin-Elmer Corporation was incorporated in 1939
under the laws of the State of New York. Together with its
consolidated subsidiaries, The Perkin-Elmer Corporation
(hereinafter collectively referred to as "Registrant" or the
"Corporation") develops, manufactures, and sells products in
the industry segments described in sub-item (c) below.
On February 18, 1993, the shareholders of Registrant and
Applied Biosystems, Inc. ("ABI"), a supplier of automated
systems for life science research and related applications,
approved the merger of a subsidiary of Registrant with and
into ABI which resulted in ABI becoming a wholly-owned
subsidiary of Registrant. Effective July 1, 1994, ABI was
merged into Registrant and is now the Applied Biosystems
Division of Registrant.
On April 18, 1994, Registrant entered into an agreement
with Sulzer Inc. to sell its Material Sciences segment
consisting of its Metco Division ("Metco") headquartered in
Westbury, New York. Registrant completed the sale on
September 30, 1994.
The consolidated financial statements and schedules
reflect the merger with ABI as a pooling of interests and
present the Corporation's Material Sciences segment as a
discontinued operation.
On May 18, 1993, Registrant amended its By-laws to change
Registrant's fiscal year end from July 31 to June 30. Prior
to fiscal year 1993, the financial statements of ABI and
Registrant's subsidiaries outside the United States were for
the years ended June 30, while Registrant's domestic
operations were reported on a July 31 fiscal year end.
In order to concentrate on two different strategies for
the Analytical Instruments and Life Sciences businesses,
Registrant reorganized into two separate business segments in
1996.
On August 25, 1997, Registrant and PerSeptive Biosystems,
Inc. ("PerSeptive") announced that they had signed a
definitive merger agreement in which Registrant would acquire
PerSeptive for $13.00 per share, paid in Registrant's stock.
Based on then current market prices, this transaction will
involve the exchange of approximately $360 million in newly
issued Registrant stock for outstanding PerSeptive securities.
The transaction is subject to antitrust regulatory clearance,
approval by holders of a majority of the outstanding shares of
PerSeptive common stock, and certain other conditions. No
vote of Registrant's shareholders is required. Both companies
expect the merger to be completed by the end of calendar 1997.
Page 1
<PAGE>
(b) Financial Information About Industry Segments.
A summary of net sales to unaffiliated customers,
operating income, and identifiable assets attributable to each
of the Registrant's industry segments for the fiscal years
ended June 30, 1997, 1996 and 1995 is incorporated herein by
reference to Note 6 on Pages 52-53 of the Annual Report to
Shareholders for the fiscal year ended June 30, 1997.
(c) Narrative Description of Business.
Registrant develops, manufactures and markets, on a
worldwide basis, life science and analytical instrument
systems used in such markets as pharmaceutical, biotechnology,
environmental testing, food, agriculture, and chemical
manufacturing.
The Registrant's operations are organized within two
industry segments: (1) Analytical Instruments; and (2) Life
Sciences. These segments are more fully described below.
ANALYTICAL INSTRUMENTS
Registrant's Analytical Instruments segment, consisting
of Registrant's Analytical Instruments Division, develops,
manufactures, markets, sells, and services analytical
instrument systems.
Analytical chemistry is the science of experimentally
determining the elemental and chemical and physical
characteristics that make up a particular sample. Analytical
instruments are the tools used to perform analytical
chemistry. These systems detect, identify and measure changes
in properties of solids, liquids and gases. For example,
certain types of analytical instruments are targeted toward
determining chemical composition, others are used to study
molecular structure and still others measure physical
characteristics. Analytical instruments are also used for
testing and analysis applications, both inside and outside of
laboratories. The use of analytical instruments is widespread
in the life science, pharmaceutical, food, bio-medical,
chemicals, petrochemicals, material science, and environmental
industries, as well as in academic research.
Registrant's Analytical Instrument products tend to vary
significantly in terms of their technologies, test
methodologies, applications, performance and cost. Moreover,
there is rarely any overlap of instruments across categories
of inorganic elements/organic compound/attribute level. That
is, an instrument can be applied for use either in analyzing
elements, compounds or attributes, but typically not more than
one of these applications.
Registrant's Analytical Instrument products can be
broadly classified into four categories:
1. Chromatography. Chromatography instruments are designed
to analyze complex mixtures by first separating them into
their components, and then measuring them quantitatively.
Registrant offers two types of chromatography products:
liquid (LC); and gas (GC).
2. Inorganic Analysis. These instruments are intended for
analysis of inorganic elements such as lead, mercury,
arsenic or gold in a wide variety of samples from oils
and water to geological materials. Registrant offers
three types of inorganic analysis products: atomic
absorption spectrometers; inductively coupled plasma
optical emission spectrometers; and inductively coupled
plasma/mass spectrometers.
Page 2
<PAGE>
3. Organic Analysis. These instruments are designed to
provide qualitative and quantitative information for
molecular and organic compounds, in the broadest range of
samples. Registrant's organic analysis products include:
infrared and near infrared spectrometers; thermal
analyzers; ultraviolet, visible and near infrared
spectrometers; fluorescence spectrometers; analytical
balances; and polarimeters.
4. Laboratory Information Management Systems. These systems
provide data handling and data management for analytical
laboratories.
Registrant also provides services including: repair and
maintenance, validation, consulting, installation and other
product support services.
The principal markets for Registrant's Analytical
Instrument products and services include: agricultural
analysis, automotive industries, petrochemical industries,
clinical and biological analysis industries, environmental
testing and monitoring, materials research, food quality
management, pharmaceutical, and semiconductors.
LIFE SCIENCES
Registrant's Life Sciences segment, consisting of
Registrant's Applied Biosystems Division, develops,
manufactures, markets, sells and services a wide range of
biochemical analytical instrument systems and products,
consisting of instruments, associated reagents and consumable
products.
The analytical problems of biotechnology differ from
those of classical chemical analysis because the molecules
involved are larger than those with which analytical chemists
are usually concerned. In addition, problems differ because
the detailed structure, and in particular the exact order of
the specific nucleotide building blocks in these molecules, is
the most important piece of information.
All cells are composed of four basic biomolecules:
nucleic acids which include deoxyribonucleic acid and
ribonucleic acid , proteins, carbohydrates and lipids.
Although all of these macromolecules are critical for a cell
to function normally, historically key advances in
therapeutics have come from an understanding of proteins or
DNA. Increasingly, and principally driven by the
"biotechnology revolution," researchers are developing an
understanding of and focusing on DNA's role in the growth pattern
of disease. An increased knowledge of how DNA ultimately
determines the functions of living organisms has generated a
worldwide effort to identify and sequence genes of many
organisms, including the estimated 100,000 genes comprising
the human genome. This effort is being led by the Human
Genome Project and related academic, government and industry
research projects.
The Life Science products and services are used in both
research and commercial applications in analyzing,
synthesizing, sequencing and amplifying proteins and genetic
material.
Registrant's Life Science products can be broadly
classified into five categories:
1. Genetic Analysis. Genetic analysis primarily uses
electrophoresis techniques for separating molecules
based on their differentialmobility in an electric field.
Registrant's genetic analysis products are further
differentiatedbetween DNA sequencers and DNA fragment
analysis systems.
Page 3
<PAGE>
DNA sequencers are used to determine the exact order of
nucleotide base pairs that make up DNA. This is done
through the fluorescent tagging of bases, each with a
different colored tag. The tagged fragments are then run
through a gel electrophoresis grid and detected by a
scanner at the bottom of the gel. Registrant's DNA
sequencing products include a sequencer expandable to 96
lanes, a single-lane capillary sequencer, and sequencing
reagents. These automated systems and products are used
for amplification, purification, isolation, analysis,
synthesis, and sequencing of nucleic acids, proteins, and
other biological molecules.
DNA fragment analyzers are used to determine the size,
quantity or pattern of DNA fragments generated by Polymerase
Chain Reaction ("PCR") amplification or other means. Typically
this is done by using fluorescently tagged PCR primers to generate
labeled PCR products. Those products are then analyzed
electrophoretically. Fragment analysis applications
include gene mapping and forensic typing, using
microsatellite markers, single-strand conformation
polymorphism (SSCP) analysis to screen for unknown
mutations within genes, and oligonucleotide ligation
assay (OLA) analysis to detect known mutations within
characterized genes.
2. PCR Products. PCR allows for the amplification of
genetic material that otherwise is and of insufficient
quantity to be detected, by producing enough copies of
the material of interest to conduct numerous studies.
PCR products include 24, 48 and 96 sample amplification
systems, a combination PCR preparation and DNA
sequencing system, a combination PCR and PCR detection
system, and various reagents.
3. DNA Synthesizers. DNA synthesizers build synthetic DNA.
Synthetic DNA is used for DNA sequencing primers and is
also used in drug discovery applications. Registrant currently
markets 5 models of synthesizers. Registrant also provides
custom synthesis, in which oligonucleotides are
made-to-order and shipped to customers.
4. Protein Synthesis and Analysis. Protein sequencers
provide information about the amino acids that make up a
given protein by enzymatically digesting the protein and
analyzing the components. Peptide synthesizers build
peptides from amino acids through successive reactions
which involve the addition of the next amino acid,
removal of the groups in order to prevent unwanted side
reactions, activation to ready the growing chain for the
next amino acid addition, and, finally, repeating the
cycle until the desired peptide is produced. The
synthetically-produced peptides are used in understanding
antibody reactions and as potential drugs or drug
analogues.
5. Liquid Chromatography/Mass Spectrometry "LC/MS". LC/MS
combines the separation of complex mixtures with the
quantitation and/or identification of the compounds in
the mixture.
In a joint venture, Perkin-Elmer Sciex Instruments,
Registrant is engaged in the manufacture and sale of mass
spectrometry instrument systems, which are sold by both the
Analytical Instruments and Life Sciences segments.
Registrant also provides services including: repair and
maintenance, consulting, installation and other product
support services.
Page 4
<PAGE>
The principal markets for Registrant's Life Sciences
products and services include human disease research, genetic
analysis, pharmaceutical drug discovery, clinical and
biological analysis, and forensics.
MARKETING AND DISTRIBUTION
The marketing and distribution systems for Registrant's
Analytical Instruments and Life Sciences businesses are
essentially the same. In the United States, Registrant
markets the largest portion of its products directly through
its own sales and distribution organizations, although certain
products are marketed through independent distributors and
sales representatives. Sales to major markets outside of the
United States are generally made by the Registrant's foreign
based sales and service staff, although some sales are made
directly from the United States to foreign customers. In
certain foreign countries, sales are made through various
representative and distributorship arrangements. Registrant
owns or leases sales and service offices in strategic regional
locations in the United States, and in foreign countries
through its foreign sales subsidiaries and distribution
operations. None of Registrant's products is distributed
through retail outlets.
RAW MATERIALS
There are no specialized raw materials that are
particularly essential to the operation of Registrant's
business. Registrant's manufacturing operations require a
wide variety of raw materials, electronic and mechanical
components, chemical and biochemical materials, and other
supplies, some of which are occasionally found to be in short
supply. Registrant has multiple commercial sources for most
components and supplies but is dependent on single sources for
a limited number of such items, in which case Registrant
normally secures long-term supply contracts. In certain cases,
discontinuances of certain sources could temporarily interrupt
Registrant's business in the Life Sciences segment.
PATENTS, LICENSES, AND FRANCHISES
Registrant has pursued a policy of seeking patent
protection in the United States and other countries for
developments, improvements, and inventions originating within
its organization which are incorporated in Registrant's
products or which fall within its fields of interest. Certain
licenses under patents have been granted to, and received
from, other entities. Registrant has certain rights from
Hoffmann-La Roche Inc. under patents relating to PCR, which
patents expire in 2004. Registrant also has rights under a
patent issued to the California Institute of Technology
relating to DNA sequencing, which patent expires in 2009. In
Registrant's opinion, however, no other single patent or
license, or group of patents or licenses, or any franchise, is
material to its business as a whole or to either industry
segment.
From time to time, Registrant has asserted that various
competitors and others are infringing Registrant's patents and
similarly, from time to time, others have asserted that
Registrant was infringing patents owned by them. In most
cases, such claims are settled by mutual agreement on a
satisfactory basis and result in the granting of licenses by
Registrant or the granting of licenses to Registrant.
SEASONAL FLUCTUATIONS
Neither of Registrant's industry segments is subject to
pronounced seasonal fluctuations.
Page 5
<PAGE>
BACKLOG
Registrant's recorded backlog was $173.2 million at June
30, 1997 and $182.3 million at June 30, 1996. It is
Registrant's general policy to include in backlog only
purchase orders or production releases which have firm
delivery dates within one year. Recorded backlog may not
result in sales because of cancellation or other factors. It
is anticipated that all orders included in the current backlog
will be delivered before the close of fiscal year 1998.
UNITED STATES GOVERNMENT SALES
No material portion of either of Registrant's industry
segments is subject to renegotiation of profits or termination
of contracts or subcontracts at the election of the United
States Government.
COMPETITION
The industry segments in which Registrant operates are
highly competitive and are characterized by the application of
advanced technology. There are numerous companies which
specialize in, and a number of larger companies which devote a
significant portion of their resources to, the development,
manufacture, and sale of products which compete with those
manufactured or sold by Registrant. Many of Registrant's
competitors are well-known manufacturers with a high degree of
technical proficiency. In addition, competition is
intensified by the ever-changing nature of the technologies in
the industries in which Registrant is engaged. The markets
for Registrant's products are characterized by specialized
manufacturers that often have strength in narrow segments of
these markets. While the absence of reliable statistics makes
it difficult to determine Registrant's relative market
position in its industry segments, Registrant is confident it
is one of the principal manufacturers in its fields, marketing
a broad line of analytical instruments and life science
systems. In addition to competing in terms of the technology
that Registrant offers, Registrant competes in terms of price,
application requirements, service, and quality.
RESEARCH, DEVELOPMENT, AND ENGINEERING
Registrant is actively engaged in basic and applied
research, development, and engineering programs designed to
develop new products and to improve existing products. During
fiscal years 1997, 1996, and 1995, Registrant spent $105.7
million, $102.3 million, and $95.1 million, respectively, on
company sponsored research, development, and engineering
activities.
ENVIRONMENTAL MATTERS
Registrant is subject to federal, state, and local laws
and regulations regulating the discharge of materials into the
environment, or otherwise relating to the protection of the
environment, in those jurisdictions where Registrant operates
or maintains facilities. Registrant does not believe that
compliance with all environmental provisions will have a
material effect on its business, and no material capital
expenditures are expected for environmental control.
EMPLOYEES
As of June 30, 1997, Registrant employed 5,685 persons
worldwide. None of Registrant's United States employees is
subject to collective bargaining agreements.
Page 6
<PAGE>
(d) Financial Information About Foreign and Domestic
Operations and Export Sales.
A summary of net revenues to unaffiliated customers,
operating income, and identifiable assets attributable to each
of Registrant's geographic areas and export sales for the
fiscal years 1997, 1996, and 1995 is incorporated herein by
reference to Note 6 on Pages 52 and 54 of the Annual Report to
Shareholders for the fiscal year ended June 30, 1997.
Registrant's consolidated net revenues to unaffiliated
customers in countries other than the United States for the
fiscal years 1997, 1996, and 1995 were $792.4 million, $744.7
million, and $669.8 million, or 62.1%, 64.0%, and 63.0%,
respectively, of Registrant's consolidated net revenues.
All of the Registrant's manufacturing facilities outside
of the continental United States are located in Germany, the
United Kingdom, Japan, Canada, and Singapore.
There are currently no material foreign exchange controls
or similar limitations restricting the repatriation to the
United States of capital or earnings from operations outside
the United States.
(e) Discontinued Operations.
On September 30, 1994, Registrant sold Metco, comprising
its Material Sciences segment, headquartered in Westbury, New
York to Sulzer Inc., a wholly-owned subsidiary of Sulzer,
Ltd., Winterthur, Switzerland. The consolidated financial
statements and schedules present Registrant's Material
Sciences segment as a discontinued operation.
Item 2. PROPERTIES
Listed below are the principal facilities of Registrant
as of June 30, 1997. Registrant considers all facilities
listed below to be reasonably appropriate for the purpose(s)
for which they are used, including manufacturing, research and
development, and administrative purposes. All properties are
maintained in good working order and, except for those held
for sale or lease, are substantially utilized on the basis of
at least one shift. None of the leased facilities is leased
from an affiliate of Registrant. Facilities are grouped
within the business segment which is the principal user.
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<PAGE>
Approximate
Owned or Expiration Floor Area
Location Leased Date of Lease In Sq. Ft.
Analytical Instruments
Norwalk, CT Owned 402,000
Wilton, CT Owned 219,000
San Jose, CA Owned 72,000
Beaconsfield, England Owned 70,000
Ueberlingen, Germany Owned 62,000
Ontario, Canada Owned 38,000
Irvine, CA Owned 22,000
Toronto, Canada Owned 14,700
Ueberlingen, Germany Leased 2001 180,000
Llantrisant, Wales Leased * 113,000
Singapore Leased 1999 30,000
Meersburg, Germany Leased 1998 24,000
Beaconsfield, England Leased 2005 8,000
Life Sciences
Warrington, England Owned 58,000
Narita, Japan Owned 24,000
San Jose, CA Owned 9,000
Foster City, CA** Leased 1997-2005 436,000
Bedford, MA Leased 2000 15,000
Davis, CA Leased 1999 13,000
Salt Lake City, UT Leased 1999 8,000
* Leased on a month to month basis as the facility is being closed.
** Comprising 3 principal facilities totaling 324,000
square feet, and additional facilities totaling 112,000 square
feet.
In addition to the facilities listed above, Registrant
leases space in certain industrial centers for use as regional
sales and service offices, technical demonstration centers,
and warehousing. Registrant also owns undeveloped land in
Redding, Connecticut; Vacaville, California; and Ueberlingen,
Germany.
In addition to the properties used by Registrant in its
operations, Registrant owned as of June 30, 1997 a facility in
Garden Grove, California (approximately 82,000 square feet),
leased to OCA Applied Optics, Inc., which was sold in July
1997. Registrant also owns two facilities in Wilton,
Connecticut (approximately 51,000 square feet and 42,000
square feet), which are held for sale or lease. One of the
facilities in Wilton is leased on a long-term basis, and a
portion of the other facility in Wilton is leased on a short-
term basis.
Item 3. LEGAL PROCEEDINGS
The Corporation has been named as a defendant in various legal
actions arising from the conduct of its normal business activities.
Although the amount of any liability that might arise
Page 8
<PAGE>
with respect to any of these matters cannot be accurately
predicted, the resulting liability, if any, will
not, in the opinion of management of Registrant, have a
material adverse effect on the consolidated financial
statements of Registrant.
Registrant was one of approximately 125 third party
defendants named in a third party complaint dated February 19,
1993 in United States of America v. Davis et al., which is
pending in the United States District Court for the District
of Rhode Island. The third party plaintiffs, who were named
as defendants and potentially responsible parties in the
Government's initial complaint, sought equitable contribution
and indemnification in the event they were found liable for
remediation costs relating to the removal of hazardous
substances from a site located in Smithfield, Rhode Island
(such costs initially were estimated by the Government to be
$27.8 million, but most recent estimates of such costs appear
to be in the $40 million range). All but one of the third
party plaintiffs settled with the Government for a total of
approximately $6 million, and a trial on the question of the
remaining third party plaintiff's liability to the Government
resulted in an April 22, 1995 Memorandum and Order in which
the Court found such plaintiff, United Technologies
Corporation, liable as a "generator" of hazardous wastes
deposited at the site. Thereafter, the Court permitted United
Technologies Corporation to proceed with its claims against
third parties. Approximately one-half of the third party
claims have been settled, and the remaining claims, including
the claim against Registrant, are likely to be scheduled for
trial in early 1998. In addition, the Government has
threatened to sue non-settling third party defendants for the
unreimbursed waste removal costs should United Technologies
Corporation prevail in its suit. Registrant, while vigorously
contesting the case, has explored the possibility of an out-
of-court settlement, but to date such efforts have proven
unsuccessful. Because of the uncertainty of all litigation,
Registrant cannot definitively state that it will incur less
than $100,000 in monetary liability.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF
SECURITY HOLDERS
No matter was submitted to a vote of security holders,
through the solicitation of proxies or otherwise, during the
fourth quarter of the fiscal year covered by this report.
PART II
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS
(a) Market Information.
The principal United States market where Registrant's
Common Stock is traded is the New York Stock Exchange,
although such stock is also traded on the Pacific Stock
Exchange.
The following information, which appears in Registrant's
Annual Report to Shareholders for the fiscal year ended June
30, 1997, is hereby incorporated by reference in this Form 10-
K: the high and low sales prices of Registrant's Common Stock
for each quarterly period during the fiscal years 1997 and
1996 (Note 13, Page 61 of the Annual Report to Shareholders
for the fiscal year ended June 30, 1997).
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(b) Holders.
On September 8, 1997, the approximate number of holders
of Common Stock of Registrant was 6,889. The approximate
number of holders is based upon the actual number of holders
registered in the books of Registrant at such date and does
not include holders of shares in "street name" or persons,
partnerships, associations, corporations, or other entities
identified in security position listings maintained by
depository trust companies. The calculation of the number of
shares of Registrant's Common Stock held by non-affiliates
shown on the cover of this Form 10-K was made on the
assumption that there were no affiliates other than executive
officers and directors.
(c) Dividends.
The amount of quarterly dividends paid during the fiscal
years 1997 and 1996 (Note 13, Page 61 of Registrant's Annual
Report to Shareholders for the fiscal year ended June 30,
1997) is hereby incorporated by reference in this Form 10-K.
(d) Sale of Unregistered Securities
Registrant has sold no securities in the last 3 years
which were not registered under the Securities Act of 1933.
Item 6. SELECTED FINANCIAL DATA
Registrant hereby incorporates by reference in this Form
10-K, Page 34 of Registrant's Annual Report to Shareholders for
the fiscal year ended June 30, 1997.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Registrant hereby incorporates by reference in this Form
10-K, Pages 35-41 of Registrant's Annual Report to
Shareholders for the fiscal year ended June 30, 1997.
Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK
Registrant hereby incorporates by reference in this Form
10-K, Note 12 on Pages 59-60 of Registrant's Annual Report to
Shareholders for the fiscal year ended June 30, 1997.
Item 8. FINANCIAL STATEMENTS AND
SUPPLEMENTARY DATA
The following financial statements and the supplementary
financial information included in Registrant's Annual Report
to Shareholders for the fiscal year ended June 30, 1997 are
incorporated by reference in this Form 10-K: the Consolidated
Financial Statements and the report thereon of Price
Waterhouse LLP dated July 23, 1997, and Pages 42-62 of said
Annual Report, including Note 13, Page 61, which contains
unaudited quarterly financial information.
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Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
Registrant has not changed its public accounting firm
within 24 months prior to June 30, 1997, the date of
Registrant's most recent financial statements. There have
been no unresolved disagreements on any matter of accounting
principles or practices, financial statement disclosure, or
auditing scope or procedure.
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PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS
OF THE REGISTRANT
(a) Identification and Background of Directors.
Registrant hereby incorporates by reference in this Form 10-K,
Pages 1-3 of Registrant's Proxy Statement dated September 8,
1997, in connection with its Annual Meeting of Shareholders to be
held on October 16, 1997.
(b) Identification of Executive Officers.
The following is a list of Registrant's executive officers,
their ages, and their positions and offices with the Registrant,
as of September 8, 1997.
<TABLE>
<CAPTION>
Name Age Present Positions and Year First Elected
<S> <C> <C>
Manuel A. Baez...........55 Senior Vice President and President, Analytical Instruments Division (1996)
Peter Barrett............44 Vice President (1994)
Ugo D. DeBlasi...........35 Corporate Controller (1997)
Michael W. Hunkapiller...48 Vice President (1994)
Stephen O. Jaeger........53 Vice President, Chief Financial Officer (1995), and Treasurer (1996)
Joseph E. Malandrakis....52 Vice President (1993)
Mark C. Rogers...........54 Senior Vice President, Corporate Development, and Chief Technology Officer (1996)
William B. Sawch.........42 Vice President, General Counsel and Secretary (1993)
Tony L. White............51 Chairman, President, and Chief Executive Officer (1995)
</TABLE>
Each of the foregoing named officers was either elected at
the last organizational meeting of the Board of Directors held on
October 17, 1996 or was elected by the Board since that date.
The term of each officer will expire on October 16, 1997, the
date of the next scheduled organizational meeting of the Board of
Directors, unless renewed for another year. Mr. Jaeger has
announced his resignation as Vice President, Chief Financial
Officer and Treasurer on or about September 30, 1997. Mr. Dennis
L. Winger has been appointed Senior Vice President, Chief
Financial Officer and Treasurer effective upon Mr. Jaeger's
resignation.
(c) Identification of Certain Significant Employees.
Not applicable.
(d) Family Relationships.
To the best of Registrant's knowledge and belief, there is
no family relationship between any of Registrant's directors,
executive officers, or persons nominated or chosen by Registrant
to become a director or an executive officer.
(e) Business Experience.
With respect to the business experience of Registrant's
directors and persons nominated to become directors,
Registrant hereby incorporates by reference in this Report
on Form 10-K Pages 1-3 of Registrant's Proxy Statement
dated September 8, 1997, in connection with its Annual
Page 12
<PAGE>
Meeting of Shareholders to beheld on October 16, 1997. With
respect to the executive officers of Registrant, each such
officer has been employed by Registrant or a subsidiary in one
or more executive or managerial capacities for at least the past
five years, with the exception of Mr. Baez, Dr. Hunkapiller,
Mr. Jaeger, Dr. Rogers, Mr. White and Mr. Winger.
Mr. Baez was elected Senior Vice President of Registrant on
June 20, 1996. Prior to his employment by Registrant in June,
1996, Mr. Baez was employed by Baxter International Inc. for 22
years, most recently as Executive Vice President, International.
Prior to joining Baxter International, Inc., Mr. Baez was
employed by Ciba-Geigy, Inc.
Dr. Hunkapiller was elected Vice President of Registrant on
October 20, 1994. Prior to his employment by Registrant in
February, 1993, Dr. Hunkapiller was employed by ABI as Executive
Vice President. Dr. Hunkapiller joined ABI in 1983 as a member
of the Research and Development group and was later appointed
Vice President, Research and Development. He also served as Vice
President, Science and Technology, and General Manager, DNA
Business Unit.
Mr. Jaeger was elected Vice President of Registrant on March
16, 1995. Prior to his employment by Registrant in March, 1995,
Mr. Jaeger was employed by Houghton Mifflin and Company from 1987
to 1995, most recently as Executive Vice President, Chief
Financial Officer and Treasurer, and served on its board of
directors. Prior to joining Houghton Mifflin, he served in
various capacities at British Petroleum North America, Inc. from
1979 to 1987, with his last position being Senior Vice President
and Chief Financial Officer.
Dr. Rogers was elected Senior Vice President on June 20,
1996. Prior to his employment by Registrant in May, 1996, Dr.
Rogers was Vice Chancellor for Health Affairs at Duke University
Medical Center and Chief Executive Officer at Duke Hospital and
Health Network from 1992 to 1996. Prior to joining Duke,
Dr. Rogers held a number of positions at Johns Hopkins
University, including Chairman of the Department of
Anesthesiology and Critical Care Medicine.
Mr. White was elected Chairman, President and Chief
Executive Officer of Registrant in September, 1995. Prior to his
joining Registrant, he was Executive Vice President and a member
of the Office of the Chief Executive of Baxter International Inc.
He also served as Group Vice President of Baxter International
Inc. from 1986 to 1992. Mr. White is also a director of
C.R. Bard, Inc. and Ingersoll-Rand Company.
Mr. Winger has accepted the position of Senior Vice
President, Chief Financial Officer, and Treasurer effective
September 30, 1997. Prior to his employment by Registrant, Mr.
Winger was employed by Chiron Corporation where he was Senior
Vice President, Finance and Administration, and Chief Financial
Officer since 1989.
(f) Involvement in Certain Legal Proceedings.
To the best of Registrant's knowledge and belief, none of
Registrant's directors, persons nominated to become directors, or
executive officers has been involved in any proceedings during
the past five years that are material to an evaluation of the
ability or integrity of such persons to be directors or executive
officers of Registrant.
Page 13
<PAGE>
(g) Compliance with Section 16(a) of the Securities Exchange
Act of 1934.
Information concerning compliance with Section 16(a) of the
Securities Exchange Act of 1934 is incorporated by reference to
Page 7 of Registrant's Proxy Statement dated September 8, 1997,
in connection with its Annual Meeting of Shareholders to be held
on October 16, 1997.
Item 11. EXECUTIVE COMPENSATION
Registrant hereby incorporates by reference in this Form 10-K
Pages 8-11 and 13-18 of Registrant's Proxy Statement dated
September 8, 1997, in connection with its Annual Meeting of
Shareholders to be held on October 16, 1997.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
(a) Security Ownership of Certain Beneficial Owners.
Registrant hereby incorporates by reference in this Form 10-K,
Page 6 of Registrant's Proxy Statement dated September 8, 1997,
in connection with its Annual Meeting of Shareholders to be held
on October 16, 1997.
(b) Security Ownership of Management.
Information concerning the security ownership of management
is hereby incorporated by reference to Pages 2-3 and 7 of
Registrant's Proxy Statement dated September 8, 1997, in
connection with its Annual Meeting of Shareholders to be held on
October 16, 1997.
(c) Changes in Control.
Registrant knows of no arrangements, including any pledge by
any person of securities of Registrant, the operation of which
may at a subsequent date result in a change in control of
Registrant.
Item 13. CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS
Information concerning certain related party transactions is
hereby incorporated by reference to Note 9, Pages 56-57 of the
Annual Report to Shareholders for the fiscal year ended June 30,
1997, and to Page 6 of Registrant's Proxy Statement dated
September 8, 1997, in connection with its Annual Meeting of
Shareholders to be held on October 16, 1997.
Page 14
<PAGE>
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
AND REPORTS ON FORM 8-K
(a) 1. Financial Statements.
The following consolidated financial statements, together
with the report thereon of Price Waterhouse LLP dated July 23,
1997, appearing on Pages 42 through 62 of Registrant's Annual
Report to Shareholders for the fiscal year ended June 30, 1997,
are incorporated by reference in this Form 10-K. With the
exception of the aforementioned information and that which is
specifically incorporated in Parts I and II, the Annual Report to
Shareholders for the fiscal year ended June 30, 1997 is not to be
deemed filed as part of this report on Form 10-K.
10-K Annual Report
Page No. Page No.
Consolidated Statements of
Operations - fiscal years
1997, 1996, and 1995..................... -- 42
Consolidated Statements of
Financial Position - fiscal years
1997 and 1996............................ -- 43
Consolidated Statements of
Cash Flows - fiscal years
1997, 1996, and 1995..................... -- 44
Consolidated Statements of
Shareholders' Equity - fiscal years
1997, 1996, and 1995..................... -- 45
Notes to Consolidated Financial
Statements............................... -- 46-61
Report of Management....................... -- 62
Report of Price Waterhouse LLP............. -- 62
(a) 2. Financial Statement Schedules.
The following additional financial data should be read in
conjunction with the consolidated financial statements in said
Annual Report to Shareholders for the fiscal year ended June 30,
1997. Schedules not included with this additional financial data
have been omitted because they are not applicable or the required
information is shown in the consolidated financial statements or
notes thereto.
Annual
10-K Page No. Report Page No.
Report of Independent Accountants
on Financial Statement Schedule........... 20 --
Schedule II - Valuation and
Qualifying Accounts and Reserves.......... 21 --
Page 15
<PAGE>
(a) 3. Exhibits.
Exhibit
No.
2(1) Acquisition Agreement dated July 19, 1991, among the Corporation,
Hoffmann-LaRoche Inc., and Roche Probe, Inc. (Incorporated by
reference to Exhibit 1 to Current Report on Form 8-K of the Corporation
dated July 19, 1991 (Commission file number 1-4389).)
2(2) Acquisition Agreement dated July 19, 1991, between the Corporation and
F. Hoffmann-La Roche Ltd. (Incorporated by reference to Exhibit 2 to
Current Report on Form 8-K of the Corporation dated July 19, 1991
(Commission file number 1-4389).)
2(3) Agreement and Plan of Merger, by and among Registrant, Sequence
Acquisition Company and Applied Biosystems, Inc. dated as of October 6,
1992. (Incorporated by reference to Exhibit 2 to Current Report on
Form 8-K of the Corporation dated October 6, 1992 (Commission file
number 1-4389).)
2(4) Agreement dated April 18, 1994 between Sulzer Inc. and The Perkin-Elmer
Corporation, as amended through August 31, 1994. (Incorporated by
reference to Exhibit 2(4) to Annual Report on Form 10-K of the
Corporation for fiscal year ended June 30, 1994 (Commission file number
1-4389).)
2(5) Agreement and Plan of Merger, dated as of August 23, 1997, among
the registrant, Seven Acquisition Corp. and PerSeptive
Biosystems, Inc. (Incorporated by reference to Exhibit 2 to Current
Report on Form 8-K of the Corporation dated August 23, 1997 (Commission
file number 1-4389).)
3(i) Restated Certificate of the Corporation as amended through July 1,
1994. (Incorporated by reference to Exhibit 3(I) to Annual Report on
Form 10-K of the Corporation for fiscal year ended June 30, 1994
(Commission file number 1-4389).)
3(ii) Amended and Restated By-laws of the Corporation, as amended through
July 15, 1993. (Incorporated by reference to Exhibit 3(ii) to Annual
Report on Form 10-K of the Corporation for fiscal year ended June 30,
1993 (Commission file number 1-4389).)
4(1) Three Year Credit Agreement dated June 1, 1994, among Morgan Guaranty
Trust Company, certain banks named in such Agreement, and the
Corporation, as amended July 20, 1995. (Incorporated by reference to
Exhibit 4(1) to Annual Report on Form 10-K of the Corporation for
fiscal year ended June 30, 1995 (Commission file number 1-4389).).
4(2) Amendment dated as of March 31, 1996 to the Three Year Credit Agreement
dated as of June 1, 1994, among Morgan Guaranty Trust Company, certain
banks named in such Agreement, and the Corporation, as amended July 20,
1995.
4(3) Shareholder Protection Rights Agreement dated April 30, 1989, between
The Perkin-Elmer Corporation and The First National Bank of Boston.
(Incorporated by reference to Exhibit 4 to Current Report on Form 8-K
of the Corporation dated April 20, 1989 (Commission file number 1-
4389).)
10(1) The Perkin-Elmer Corporation 1984 Stock Option Plan for Key Employees,
as amended through May 21, 1987. (Incorporated by reference to Exhibit
28(c) to Post Effective Amendment No. 1 to the Corporation's
Registration Statement on Form S-8 (No. 2-95451).)
10(2) The Perkin-Elmer Corporation 1988 Stock Incentive Plan for Key
Employees. (Incorporated by reference to Exhibit 10(4) to Annual
Report on Form 10-K of the Corporation for the fiscal year ended July
31, 1988 (Commission file number 1-4389).)
10(3) The Perkin-Elmer Corporation 1993 Stock Incentive Plan for Key
Employees. (Incorporated by reference to Exhibit 99 to the
Corporation's Registration Statement on Form S-8 (No. 33-50847).)
10(4) The Perkin-Elmer Corporation 1996 Stock Incentive Plan. (Incorporated
by reference to Exhibit 99 to the Corporation's Registration Statement
on Form S-8 (No. 333-15189).)
10(5) Contingent Compensation Plan for Key Employees of The Perkin-Elmer
Corporation, as amended through August 1, 1990. (Incorporated by
reference to Exhibit 10(5) to Annual Report on Form 10-K of the
Corporation for the fiscal year ended July 31, 1992 (Commission file
number 1-4389).)
10(6) The Perkin-Elmer Corporation Supplemental Retirement Plan as amended
through August 1, 1991. (Incorporated by reference to Exhibit 10(6) to
Annual Report on Form 10-K of the Corporation for the fiscal year ended
July 31, 1991 (Commission file number 1-4389).)
Page 16
<PAGE>
10(7) Agreement dated September 12, 1995, between Registrant and Tony L.
White. (Incorporated by reference to Exhibit 10(21) to Annual Report on
Form 10-K of the Corporation for the fiscal year ended June 30, 1995
(Commission file number 1-4389).)
10(8) Agreement dated May 7, 1996, between Registrant and Mark C. Rogers.
10(9) Agreement dated April 11, 1995, between Registrant and Stephen O.
Jaeger. (Incorporated by reference to Exhibit 10(19) to Annual Report
on Form 10-K of the Corporation for the fiscal year ended June 30, 1996
(Commission file number 1-4389).)
10(10) Agreement dated June 3, 1996, between Registrant and Manuel A. Baez.
10(11) Deferred Compensation Contract dated September 15, 1994, between
Registrant and Michael W. Hunkapiller. (Incorporated by reference to
Exhibit 10(7) to Annual Report on Form 10-K of the Corporation for the
fiscal year ended June 30, 1995 (Commission file number 1-4389).)
10(12) Change of Control Agreement dated September 12, 1995 between Registrant
and Tony L. White. (Incorporated by reference to Exhibit 10(16) to
Annual Report on Form 10-K of the Corporation for the fiscal year ended
June 30, 1995 (Commission file number 1-4389).)
10(13) Employment Agreement dated November 16, 1995, between Registrant and
Michael W. Hunkapiller. (Incorporated by reference to Exhibit 10(11) to
Annual Report on Form 10-K of the Corporation for fiscal year ended
June 30, 1996 (Commission file number 1-4389).)
10(14) Employment Agreement dated June 20, 1996, between Registrant and Manuel
A. Baez.
10(15) Employment Agreement dated June 20, 1996, between Registrant and Mark
C. Rogers.
10(16) Employment Agreement dated November 16, 1995, between Registrant and
Stephen O. Jaeger. (Incorporated by reference to Exhibit 10(12) to
Annual Report on Form 10-K of the Corporation for the fiscal year ended
June 30, 1996 (Commission file number 1-4389).)
10(17) The Excess Benefit Plan of The Perkin-Elmer Corporation dated August 1,
1984, as amended through June 30, 1993. (Incorporated by reference to
Exhibit 10(17) to Annual Report on Form 10-K of the Corporation for the
fiscal year ended June 30, 1993 (Commission file number 1-4389).)
10(18) 1993 Director Stock Purchase and Deferred Compensation Plan as amended
June 19, 1997.
10(19) Pledge Agreements and Promissory Notes between Registrant and Stephen
O. Jaeger, Michael W. Hunkapiller and Michael J. McPartland.
(Incorporated by reference to Exhibit 10 to Quarterly Report on Form
10-Q of the Corporation for the quarter ended March 31, 1996
(Commission file number 1-4389).)
10(20) The Division Long-Term Incentive Plan of The Perkin-Elmer Corporation
dated July 1, 1996.
10(21) The Performance Unit Bonus Plan of The Perkin-Elmer Corporation.
10(22) The Estate Enhancement Plan of The Perkin-Elmer Corporation.
10(23) The Deferred Compensation Plan of The Perkin-Elmer Corporation dated
October 1, 1996.
11 Computation of Net Income (Loss) per Share for the five years ended
June 30, 1997.
13 Annual Report to Shareholders for 1997 (to the extent incorporated
herein by reference).
21 List of Subsidiaries.
23 Consent of Price Waterhouse LLP.
27 Financial Data Schedule.
Note: None of the Exhibits listed in Item 14(a) 3 above, except
Exhibits 11 and 23, are included with this Form 10-K Annual
Report. Registrant will furnish a copy of any such Exhibit upon
written request to the Secretary at the address on the cover of
this Form 10-K Annual Report accompanied by payment of $3.00 U.S.
for each Exhibit requested.
(b) Reports on Form 8-K.
Registrant did not file a report on Form 8-K during the last
quarter of the period covered by this report.
Page 17
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, Registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto
duly authorized.
THE PERKIN-ELMER CORPORATION
By /s/ W. B. Sawch
William B. Sawch
Vice President, General Counsel
and Secretary
Date: September 12, 1997
Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has been signed below by the following
persons on behalf of Registrant and in the capacities and on the
dates indicated.
/s/ Tony L. White September 12, 1997
Tony L. White
Chairman of the Board of Directors, President
and Chief Executive Officer
(Principal Executive Officer)
/s/ Stephen O. Jaeger September 12, 1997
Stephen O. Jaeger
Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
/s/ Ugo D. DeBlasi September 12, 1997
Ugo D. DeBlasi
Corporate Controller
(Principal Accounting Officer)
/s/ Joseph F. Abely, Jr. September 10, 1997
Joseph F. Abely, Jr.
Director
Page 18
<PAGE>
/s/ Richard H. Ayers September 9, 1997
Richard H. Ayers
Director
/s/ Jean-Luc Belingard September 8, 1997
Jean-Luc Belingard
Director
/s/ Robert H. Hayes September 10, 1997
Robert H. Hayes
Director
/s/ Donald R. Melville September 8, 1997
Donald R. Melville
Director
/s/ Burnell R. Roberts September 5, 1997
Burnell R. Roberts
Director
/s/ Georges C. St. Laurent, Jr. September 10, 1997
Georges C. St. Laurent, Jr.
Director
/s/ Carolyn W. Slayman September 5, 1997
Carolyn W. Slayman
Director
/s/ Orin R. Smith September 9, 1997
Orin R. Smith
Director
/s/ Richard F. Tucker September 10, 1997
Richard F. Tucker
Director
Page 19
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS ON
FINANCIAL STATEMENT SCHEDULE
To the Board of Directors
of The Perkin-Elmer Corporation
Our audits of the consolidated financial statements referred
to in our report dated July 23, 1997, appearing on Page 62 of the
1997 Annual Report to Shareholders of The Perkin-Elmer
Corporation (which report and consolidated financial statements
are incorporated by reference in this Annual Report on Form 10-K)
also included an audit of the Financial Statement Schedule listed
in Item 14(a)2 of this Form 10-K. In our opinion, the Financial
Statement Schedule presents fairly, in all material respects, the
information set forth therein when read in conjunction with the
related consolidated financial statements.
PRICE WATERHOUSE LLP
Stamford, Connecticut
July 23, 1997
Page 20
<PAGE>
THE PERKIN-ELMER CORPORATION
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
FOR THE FISCAL YEARS ENDED JUNE 30, 1997, 1996 AND 1995
(Amounts in thousands)
ALLOWANCE FOR
DOUBTFUL ACCOUNTS
Balance at June 30, 1994............................... $7,247
Charged to income in fiscal year 1995.................. 2,086
Deductions from reserve in fiscal year 1995............ (384)
Balance at June 30, 1995............................... 8,949
Charged to income in fiscal year 1996.................. 1,090
Deductions from reserve in fiscal year 1996............ (3,194)
Balance at June 30, 1996............................... 6,845 (1)
Charged to income in fiscal year 1997.................. 1,049
Deductions from reserve in fiscal year 1997............ (2,450)
Balance at June 30, 1997............................... $5,444 (1)
(1) Deducted in the Consolidated Statements of Financial Position
from accounts receivable.
SCHEDULE II
Page 21
<PAGE>
THE PERKIN-ELMER CORPORATION
COMPUTATION OF NET INCOME (LOSS) PER SHARE
(Dollar amounts in thousands, except per share amounts)
<TABLE>
<CAPTION>
At June 30, 1997 1996 1995 1994 1993
<S> <C> <C> <C> <C> <C>
Weighted average number of common shares 43,383 42,720 42,129 43,857 43,780
Common stock equivalents - stock options 1,296 1,027 515 816 1,173
Weighted average number of common shares
used in calculating primary earnings per share 44,679 43,747 42,644 44,673 44,953
Additional dilutive stock options under
paragraph #42 APB #15 116 137 120 172 97
Shares used in calculating earnings per share - fully
diluted basis 44,795 43,884 42,764 44,845 45,050
Calculation of primary and fully diluted earnings
per share:
PRIMARY AND FULLY DILUTED:
Income from continuing operations $ 115,155 $ 13,944 $ 66,877 $ 73,978 $ 24,444
(Loss) Income from discontinued operations - - - (22,851) 1,714
Income before cumulative effect of
accounting changes 115,155 13,944 66,877 51,127 26,158
Cumulative effect of accounting changes - - - - (83,098)
Net income (loss) used in the calculation of
primary and fully diluted earnings per share $ 115,155 $ 13,944 $ 66,877 $ 51,127 $ (56,940)
PRIMARY:
Per share amounts:
Income from continuing operations $ 2.58 $ .32 $ 1.57 $ 1.66 $ .54
(Loss) Income from discontinued operations - - - (.52) .04
Income before cumulative effect of
accounting changes 2.58 .32 1.57 1.14 .58
Loss from cumulative effect of accounting changes - - - - (1.85)
Net income (loss) $ 2.58 $ .32 $ 1.57 $ 1.14 $ (1.27)
FULLY DILUTED:
Per share amounts:
Income from continuing operations $ 2.57 $ .32 $ 1.56 $ 1.65 $ .54
(Loss) Income from discontinued operations - - - (.51) .04
Income before cumulative effect of
accounting changes 2.57 .32 1.56 1.14 .58
Loss from cumulative effect of accounting changes - - - - (1.84)
Net income (loss) $ 2.57 $ .32 $ 1.56 $ 1.14 $ (1.26)
</TABLE>
EXHIBIT 11
Page 22
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the
Registration Statements on Form S-8 (Nos. 2-95451, 33-25218, 33-
44191, 33-50847, 33-50849, 33-58778, and 333-15189) of The
Perkin-Elmer Corporation of our report dated July 23, 1997,
appearing on page 62 of the Annual Report to Shareholders which
is incorporated in this Annual Report on Form 10-K. We also
consent to the incorporation by reference of our report on the
Financial Statement Schedule, which appears on page 20 of this
Form 10-K.
PRICE WATERHOUSE LLP
Stamford, Connecticut
September 10, 1997
EXHIBIT 23
Page 23
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4
<SEQUENCE>2
<DESCRIPTION>EXHIBIT 4(2) AMENDMENT TO CREDIT AGREEMENT
<TEXT>
[CONFORMED COPY]
AMENDMENT NO. 2 TO CREDIT AGREEMENT
AMENDMENT dated as of March 31, 1996 (this "Amendment") to
the Three-Year Credit Agreement dated as of June 1, 1994, as
heretofore amended (the "Agreement") among THE PERKIN-ELMER
CORPORATION (the "Borrower"), the BANKS party thereto (the "Banks")
and MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as Agent (the
"Agent").
W I T N E S S E T H :
WHEREAS, the undersigned parties desire to amend the
definition of "Consolidated EBIT" in Section 1.01 of the Agreement to
eliminate the effect of any separately identified non-recurring non-
cash gains or losses;
NOW, THEREFORE, the undersigned parties agree as follows:
SECTION 1. Definitions; References. Unless otherwise
specifically defined herein, each term used herein which is defined in
the Agreement has the meaning assigned to such term in the Agreement.
Each reference to "hereof", "hereunder", "herein" and "hereby" and
each other similar reference and each reference to "this Agreement"
and each other similar reference contained in the Agreement shall
from and after the date hereof refer to the Agreement as
amended hereby.
SECTION 2. Definition of Consolidated EBIT. The
definition of "Consolidated EBIT" in Section 1.01 of the Agreement is
amended to read as follows:
"Consolidated EBIT" means, for any period, the sum
(without duplication) of (i) net operating income for such period
plus (ii) interest income for such period plus (iii) to the
extent deducted in determining such net operating income, any
non-recurring non-cash losses separately identified on the
Borrower's consolidated statement of operations minus (iv) to the
extent included in determining such net operating income, any
non-recurring non-cash gains separately identified on the
Borrower's consolidated statement of operations, all
determined on a consolidated basis for the Borrower and its
Consolidated Subsidiaries.
SECTION 3. Governing Law. This Amendment shall be
governed by and construed in accordance with the laws of the State of
New York.
SECTION 4. Counterparts; Effectiveness. This Amendment may
be signed in any number of counterparts, each of which shall be an
original, with the same effect as if the signatures thereto and hereto
were upon the same instrument. This Amendment shall become effective
as of the date hereof when the Agent shall have received duly executed
counterparts hereof signed by the Borrower and all
Page 1
<PAGE>
the Banks (or, in the case of any such party as to which an
executed counterpart shall not have been received, the Agent
shall have received facsimile or other written confirmation from
such party of execution of a counterpart hereof by such party).
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed as of the date first above written.
THE PERKIN-ELMER CORPORATION
By /s/ Steven 0. Jaeger
Title: Vice President, Chief
Financial Officer
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By /s/ Penelope J.B. Cox
Title: Vice President
CITIBANK, N.A.
By /s/ James Walsh
Title: Attorney-in-fact
CREDIT SUISSE
By /s/ Lynn Allegaert
Title: Member of Senior Management
By /s/ Robert B. Potter
Title: Member of Senior Management
BANQUE NATIONAL DE PARIS
By /s/ Richard L. Sted
Title: Senior Vice President
By /s/ Sophie Revillard Kaufman
Title: Vice President
Page 2
<PAGE>
CHEMICAL BANK
By /s/ Ann B. Kerns
Title: Vice President
THE INDUSTRIAL BANK OF JAPAN, LIMITED
By /s/ John V. Veltri
Title: Senior Vice President
WACHOVIA BANK OF GEORGIA, N.A.
By /s/ M. Euqene Wood, III
Title: Vice President
Page 3
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<DESCRIPTION>EXHIBIT 10(8) EMPLOYMENT AGREEMENT
<TEXT>
EMPLOYMENT AGREEMENT
AGREEMENT entered into as of May 7, 1996, between THE
PERKIN-ELMER CORPORATION (the "Company"), a New York
corporation, and DR. MARK C. ROGERS ("Executive"), presently
residing at 33 West Putnam Avenue, 3H, Greenwich, CT 06830.
WHEREAS, the Company desires to employ Executive on the
terms and conditions set forth herein; and
WHEREAS, the Executive desires to render services to the
Company on the terms and conditions set forth herein;
NOW, THEREFORE, the parties hereto agree as follows:
1. Scope.
(a) The Company agrees to employ Executive, and Executive
agrees to serve as Senior Vice President of the
Corporation and Chief Technology Officer. In such
capacities, Executive shall report to the Chairman,
President and Chief Executive Officer of the Company,
and will have corporate-wide responsibilities for
strategic planning, mergers and acquisitions, business
development, technology review and oversight, as well
as integrating new business initiatives into the
Company.
(b) Executive shall devote his full business time,
attention and best efforts to the affairs of the
Company and its subsidiaries during the Term;
Page 1
<PAGE>
provided, however, that nothing in this Agreement
shall preclude Executive from engaging, so long as, in
the reasonable determination of the Board, such
activities do not interfere with his duties and
responsibilities hereunder, in religious, charitable
and community affairs, from managing any passive
investment made by him in publicly traded equity
securities or other property (provided that no such
investment may exceed 1% of the equity of any entity,
without the prior approval of the Board) or from
serving, subject to the prior approval of the Board,
as a member of boards of directors or as a trustee of
any other corporation, association or entity. The
Executive is encouraged to maintain significant
outside contacts to include lectures, advisory boards,
and consultantships in order to promote the visibility
of the Company in health care as long as such
activities do not interfere with the Executive's
performance of his Company responsibilities.
2. Term of Employment.
(a) Executive's term of employment (the "Term") under this
Agreement shall commence (the "Commencement Date") as
of the date hereof, and terminate (the "Termination
Date") on the termination of Executive's employment.
Any termination of employment by Executive (other than
Page 2
<PAGE>
for death, Permanent Disability or Good Reason) may
only be made upon 90 days prior written notice to the
Company and any termination of employment by Executive
for Good Reason may only be made upon 30 days prior
written notice to the Company.
(b) For purposes of this Agreement, "Good Reason" shall
mean the occurrence of any of the following, other
than with the consent of Executive:
i) Any failure to continue Executive as Senior Vice
President of the Corporation and Chief Technology
Officer or any material reduction by the Company
of Executive's duties or responsibilities (except
in connection with the termination of Executive's
employment for Cause, as a result of Permanent
Disability, as a result of Executive's death or
by Executive other than for Good Reason);
ii) a reduction by the Company in Executive's Base
Salary or Target Bonus (as herein defined), other
than a reduction which is part of a general
salary reduction program affecting senior
executives of the Company.
iii) any material breach by the Company of the
provisions of this Agreement; and
iv) the Company's requiring the Executive to be based
more than fifty miles from Norwalk, Connecticut
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<PAGE>
except for required travel on the Company's
business to an extent substantially consistent
with the business travel obligations of Executive
hereunder.
(c) For purposes of this Agreement, "Cause" shall mean (i)
willful malfeasance or willful misconduct by Executive
in connection with his employment, (ii) continuing
refusal by Executive to perform his duties hereunder
or any lawful direction of the Board of Directors of
the Company (other than due to Executive's physical or
mental incapacity), after a demand for a substantial
performance is delivered to the Executive by the Board
which identifies the manner in which the Executive has
not performed his duties, (iii) any material breach of
this Agreement by Executive, (iv) the willful engaging
by the Executive in conduct which is materially
injurious to the Company or (v) the indictment of
Executive for (A) any felony or (B) a misdemeanor
involving moral turpitude. Termination of Executive
for Cause shall be made by delivery to Executive of a
copy of a resolution duly adopted by the affirmative
vote of not less than a majority of the Directors at a
meeting of the Board of Directors of the Company
called and held for the purpose (after 30 days prior
written notice to Executive and reasonable opportunity
Page 4
<PAGE>
for Executive to be heard before the Board prior to
such vote), finding that in the reasonable judgment of
such Board, Executive was guilty of the conduct set
forth in any of clauses (i) through (iv) above and
specifying the particulars thereof; provided, however,
that with respect to clause (v) herein the Board shall
determine in good faith that Executive's indictment is
reasonably likely to have a material adverse effect on
Executive's ability to perform his duties hereunder as
the Senior Vice President of the Company.
(d) For purposes of this Agreement, "Permanent Disability"
means the absence of the Executive from his duties
with the Company on a full-time basis for one hundred
and eighty (180) consecutive days as a result of
incapacity due to physical or mental illness, such
that executive would be entitled to long term
disability benefits under the long term disability
plan of the Company in effect at such time.
3. Compensation.
(a) The Company will pay to Executive a base salary ("Base
Salary") at the rate of $375,000 per annum for the
period commencing on the beginning of Executive's term
of employment hereunder and ending on the Termination
Date. Base Salary shall be payable in accordance with
the ordinary payroll practices of the Company. Any
Page 5
<PAGE>
increase in Base Salary shall be in the discretion of
the Board and, as so increased, shall constitute "Base
Salary" hereunder. It is understood that the Company
shall review Executive's Base Salary annually, and in
light of such review may, in the discretion of the
Board of Directors or its Compensation Committee,
increase such Base Salary taking into account the
Executive's responsibilities, compensation of other
executives of the Company and its subsidiaries,
increase in salaries of executives of other
corporations, performance by the Executive, and other
pertinent factors.
(b) During the Term, Executive shall be eligible to
receive an annual bonus (a "Bonus") in respect of each
Fiscal Year of the Company ("Fiscal Year") under, and
subject to the terms of, the Company Contingent
Compensation Plan (the "Bonus Plan") to the extent not
inconsistent with the terms hereof. Executive's
target bonus (the "Target Bonus") under the Bonus Plan
will be equal to 60 percent of Executive's Base Salary
and will be payable in accordance with the provisions
of the Bonus Plan; provided, however, that with
respect to Fiscal Year 1996, Executive shall receive a
Bonus of not less than $37,500.
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<PAGE>
4. Stock Arrangements.
(a) Upon Executive's commencement of employment with the
Company, Executive shall be granted 15,000 shares of
restricted stock of the Company ("Restricted Stock")
in accordance with terms consistent with the Company's
1993 Stock Incentive Plan for Key Employees. (Company
has previously granted all available shares under such
plan. Accordingly, the grant to the Executive is
conditioned upon approval of the Company's
shareholders of a new plan or additional authorization
of shares under the Stock Plan. Until such approval,
the grant of Restricted Stock will be treated as a
"performance unit grant" which is consistent with the
terms of Restricted Stock but may not be voted by the
Executive.) The Restricted Stock will vest based on
the average per share market price for 90 consecutive
days of Company common stock as follows:
Average Per Share Market Price for 90 Days Vested Percentage
$59 33%
$66 33%
$73 33%
(b) As of May 7, 1996, Executive's commencement of
employment with the Company, the Company shall grant
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<PAGE>
Executive an option (an "Option") to purchase at fair
market value on the date of grant 50,000 shares of
common stock of the Company under the Stock Plan. The
Option shall vest with respect to 50% of the shares
subject thereto on each of the first and second
anniversaries of the date of grant and shall expire
ten years following the date of grant. In addition to
the foregoing Option grant, the Company, subject to
the approval of the Board, anticipates making annual
Option grants to Executive of 25,000 shares per year,
when normally granted by the Company, beginning in
calendar year 1997.
(c) Unless otherwise specified in this Section 4, the
terms of all Restricted Stock and Options granted to
Executive hereunder, including, without limitation,
terms relating to vesting and forfeiture, shall be
governed by the Stock Plan.
(d) It is understood that Company policy anticipates that
Executive will maintain a level of stock ownership in
the Company equal to two times Executive's Base
Salary. Grants of Restricted Stock under the terms of
this Agreement and shares of Company stock acquired
upon exercise of an Option shall be credited towards
Executive's stock ownership. Executive is expected to
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<PAGE>
achieve the foregoing level of stock ownership no
later than five years after the date hereof.
(e) For purposes only of vesting of Restricted Stock and
Options granted hereunder, in the event of Executive's
termination of employment his termination date will be
the May 7 following the date on which Executive's
employment is terminated.
5. Employee Benefits.
(a) During the Term, Executive shall be entitled to
participate in all employee benefit plans, programs or
arrangements ("Benefit Plans") of the Company, in
accordance with the terms thereof, as presently in
effect or as they may be modified by the Company from
time to time, which the Company makes available to
senior executives of the Company.
(b) During the Term, the Executive shall be entitled to a
paid annual vacation of not less than twenty (20)
business days during each calendar year and to
reasonable sick leave.
(c) During the Term, Executive shall receive an automobile
allowance of $15,000 per year and the Company shall
also reimburse Executive for the reasonable costs of
financial planning and tax preparation in accordance
with Company policy as in effect from time to time.
In addition, Executive shall be entitled, during the
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<PAGE>
Term, to any other perquisites and fringe benefits not
specifically mentioned herein that are made available
to senior executives of the Company, subject to the
terms of this Agreement and commensurate with his
position with the Company.
(d) In addition to receiving credit under the Company's
qualified defined benefit plan ("Pension Plan") and
the Company's non-qualified Supplemental Retirement
Plan and Contingent Compensation Plan for Key
Executives (collectively, the "Non-Qualified Plans")
for Executive's service with the Company under the
terms of this Agreement, the Company shall pay
Executive a special supplemental pension benefit equal
to the amount which he would receive under the Pension
Plan and the Non-Qualified Plans if Executive were
credited with thirteen (13) years of service under the
Pension Plan and the Non-Qualified Plans.
(e) Company shall reimburse Executive for all reasonable
costs incurred by Executive in connection with his
relocation to Connecticut. At such time as the
Executive relocates to Connecticut, Executive shall
also receive $150,000 in order to assist in such
relocation. If Executive decides to delay selling his
residence in North Carolina, he may choose to make use
of Company's Home Sale Program (which is commensurate
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<PAGE>
with that provided other executives of Company at
Executive's level) at any time during the first three
years of employment.
6. Severance; Benefits.
(a) In the event the Executive's employment is terminated
by the Company for reasons other than "Cause" (and not
due to death or Permanent Disability), or is
terminated by the Executive due to a Good Reason, and
the provisions of the Executive's Employment Agreement
of even date (entitling Executive to benefits
thereunder in the event of a "Change-in-Control" as
defined in such agreement (hereinafter referred to as
the "Change-in-Control Agreement")) are not applicable
to such termination, then the Executive shall be
entitled to, in addition to accrued retirement
benefits, an annual severance payment at the rate of
$150,000 per annum which shall be payable to the
Executive until age 65. In the event that the
Executive becomes eligible for said severance benefit,
the Executive shall have the option to receive such
benefit in an accelerated form or a lump sum based on
the net present value of such severance benefit at the
time of the Executive's eligibility therefor, and
using a discount rate of 4% to calculate such amount.
The severance benefit under this section 6 shall be in
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<PAGE>
lieu of severance under any other severance pay plan
of the Company.
(b) In the event the Executive's employment terminates,
other than for Cause, the Executive's Company provided
medical insurance coverage and life insurance coverage
shall continue upon the same terms as in effect
immediately prior to the Termination Date for a period
of up to two (2) years following the Termination Date,
and the Executive shall be deemed to be on a leave of
absence for such purposes; provided, however, that in
the event the Executive obtains employment during such
two (2) year period and his employer provides medical
and life insurance coverage comparable to that
provided hereunder, then such leave of absence shall
end and insurance coverage hereunder shall terminate.
7. Separability; Legal Fees. If any provision of this
Agreement shall be declared to be invalid or
unenforceable, in whole or in part, such invalidity or
unenforceability shall not affect the remaining provisions
hereof, which shall remain in full force and effect. Each
party shall bear the costs of any legal fees and other
fees and expenses which may be incurred in respect of
enforcing its respective rights under this Agreement;
provided, however, that the Company shall pay the costs of
any reasonable legal fees incurred by Executive in good
Page 12
<PAGE>
faith in enforcing his rights or entitlements under this
Agreement if Executive prevails in such enforcement
action.
8. Assignment. This Agreement shall be binding upon and
inure to the benefit of the heirs and representatives of
Executive and the assigns and successors of the Company,
but neither this Agreement nor any rights or obligations
hereunder shall be assignable or otherwise subject to
hypothecation by Executive (except by will or by operation
of the laws of intestate succession) or by the Company,
except that the Company may assign this Agreement to any
successor (whether by merger, purchase or otherwise) to
all or substantially all of the stock, assets or
businesses of the Company, if such successor expressly
agrees to assume the obligations of the Company hereunder.
9. No Obligation to Mitigate Damages. Except as specifically
provided in this Agreement, Executive shall not be
required to mitigate damages or the amount of any payment
provided for under this Agreement by seeking other
employment or otherwise, nor will any payments under this
Agreement be subject to offset in respect of any amounts
which Executive earns or becomes entitled to from any
other employer or other person after termination of his
employment with the Company.
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<PAGE>
10. Amendment. This Agreement may only be amended by written
agreement of the parties hereto.
11. Survivorship. The respective rights and obligations of
the parties hereunder shall survive any termination of
this Agreement to the extent necessary to the intended
preservation of such rights and obligations. The
provisions of this Section 11 are in addition to the
survivorship provisions of any other section of this
Agreement.
12. Governing Law. This Agreement shall be construed,
interpreted and governed in accordance with the laws of
the State of New York, without reference to rules relating
to conflicts of law.
13. Effect on Prior Agreements. This Agreement and the
Change-in-Control Agreement contain the entire
understanding between the parties hereto and supersede in
all respects any prior or other agreement or understanding
between the Company and Executive.
14. Withholding. The Company shall be entitled to withhold
from payment any amount of withholding required by law.
15. Supersession. Notwithstanding any other provision of this
Agreement, in the event of a Change in Control of the
Company, as defined under the Change in Control Agreement,
the provisions of this Agreement shall be superseded by
the provisions of the Change in Control Agreement.
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<PAGE>
16. Counterparts. This Agreement may be executed in two or
more counterparts, each of which will be deemed an
original.
THE PERKIN-ELMER CORPORATION
By: /s/ Tony L. White
Tony L. White
Chairman, President and
Chief Executive Officer
By: /s/ Mark C. Rogers
Dr. Mark C. Rogers
Page 15
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>4
<DESCRIPTION>EXHIBIT 10(10) LETTER OF EMPLOYMENT
<TEXT>
June 3, 1996
Mr. Manuel Baez
3502 Derby Lane
Ft. Lauderdale, FL 33331
Dear Manny:
Subject to the formal election by the Board of Directors, I am pleased to
offer you the position of Senior Vice President of the Corporation and
President, Analytical Instruments Division, reporting to Tony L. White,
Chairman, President and Chief Executive Officer.
Reporting to you in this position will be:
Dr. David Binkley, Vice President and General Mgr. Organic Div.
Peter Macintyre, Vice President and General Mgr., Chromatography Div.
Joseph Malandrakis, Vice President and General Mgr., Inorganic Div.
Dr. Nino Portolan, Vice President and Managing Director, Europe
Dr. Luigi Strassorier, Vice President and Managing Director, Far East
Luis Carmona, General Manager, Latin America
The annual salary for this position is $375,000. Your salary will be
reviewed by the Management Resources Committee of the Board in September
of each year along with the other officers of the Corporation. You will
also participate in Perkin-Elmer's Contingent Compensation Plan, which is
our annual bonus plan. In this program, you will have a targeted annual
bonus opportunity of 60% of your base salary. The plan provides a range
of bonus payouts from 0 - 90% of salary based upon accomplishment of our
annual financial targets. For FY 96 you will be guaranteed a minimum
payment of $37,500. This payment will be made following the Board
meeting in August.
Mr. Manuel Baez
June 3, 1996
Page 2
On your first day of employment, the Management Resources Committee will
formally review our recommendation of a Restricted Stock Award of 15,000
shares of Perkin-Elmer stock. This grant will vest according to the
following schedule:
Average Market Price for 90 Days % Vested
$59 33%
$66 33%
$73 33%
Additionally as each increment is earned, the Board has agreed to accept
a recommendation to "reload" your Restricted Stock Plan with an amount to
be earned against new performance measures. You will immediately begin
receiving dividends from this award, which under current dividend policy
equals $10,200.
Since we have exhausted our current pool of restricted stock, your grant
will be made by the Board conditional upon shareholder approval at our
Annual Meeting in October. Until shareholder approval, the grant will be
treated as a performance unit grant which mirrors our restricted stock in
all aspects except that you will not be entitled to vote these shares.
The Board has established ownership guidelines for all officers of the
Corporation and this restricted stock grant, is "credited" towards these
ownership guidelines. The Management Resources Committee set an
ownership target of two times annual salary for your position. This
program, initiated last year, allows five years for you to achieve this
target.
Upon your employment, the Management Resources Committee will also
formally review the recommendation to provide you a stock option grant of
50,000 shares of Perkin-Elmer stock. The option will be valued at the
average market price of the stock on the day of your election. This
stock option will vest 50% per year over two years and, subject to the
other terms of our stock plan, will expire ten years following the date
of the grant.
In April of each year, the Management Resources Committee considers
recommendations for stock option grants. Beginning in April 1997, you
will be recommended for an annual stock option grant, which based upon
our current grant practice, would be approximately 25,000 shares.
Mr. Manuel Baez
June 3, 1996
Page 3
As we have discussed, we are designing a divisionalized "Phantom Stock
Option Plan" to provide you with an opportunity to more closely tie the
long-term incentives of your team to the "value creation" which they
accomplish for the Analytical Instruments business. Likewise, Tony wants
a portion of your long-term incentives tied to the Analytical Instrument
business. When this "Phantom Stock Option" grant is determined, it will
not be additive but rather will be integrated with Perkin-Elmer stock
options to achieve an equivalent value to your annual Perkin-Elmer stock
option as described above.
Your Option Grants and Restricted Stock Awards will be subject to terms
of Perkin-Elmer's Employee Stock Incentive Plan, a copy of which will be
provided to you.
In our discussions, you raised the issue of your retirement benefit. We
propose that when you join PE you will be credited with 13 years of past-
service credit for purposes of calculating your benefit. For purposes of
vesting, we have a five year vesting requirement in our qualified plans
that must remain in place. However, you will vest immediately in our
non-qualified plan. If for any reason you resigned before you were
vested in the qualified plan, your total benefit would be derived from
the non-qualified plan.
You will receive a Change of Control Agreement, which applies to all
Executive Officers of the Corporation. This Agreement provides for three
year salary and bonus continuation in the event of a change of control of
the Corporation and the resulting loss of your position.
In addition to the foregoing, you will receive an annual car allowance of
$15,000, financial planning and tax preparation assistance, and four
weeks annual vacation. The usual range of benefits is also included as
described in the accompanying summary.
Obviously, we do not want you to experience any financial burden
associated with your move to Connecticut, and the Corporation will bear
all reasonable expenses regarding this move. As well as our normal
relocation benefits, you will receive a payment of $150,000 at the time
you join the Company in order to assist in your move from Florida.
Mr. Manuel Baez
June 3, 1996
Page 4
Manny, we hope you will accept this offer and join our team at Perkin-
Elmer. Speaking personally, I believe you will find Perkin-Elmer to be a
company that will provide the career opportunity, professional challenges
and personal rewards which you seek.
Please give me a call if you have any questions or concerns regarding any
of the above issues. You can reach me at any time at either my office at
203-761-5451 or my home at 203-259-6012.
Sincerely,
/jk
Agreed: ____________________________
Manuel Baez
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>5
<DESCRIPTION>EXHIBIT 10(14) EMPLOYMENT AGREEMENT
<TEXT>
EMPLOYMENT AGREEMENT
AGREEMENT entered into as of June 20, 1996 between THE
PERKIN-ELMER CORPORATION, a New York corporation having its
principal place of business at Norwalk, Connecticut (the
"Company") and Manuel A. Baez, residing at 3502 Derby Lane,
Ft. Lauderdale, FL 33331 (the "Employee").
WHEREAS, the Employee has rendered and/or will render
valuable services to the Company and it is regarded essential by
the Company that it have the benefit of Employee's services in
future years; and
WHEREAS, the Board of Directors of the Company believes
that it is essential that, in the event of the possibility of a
Change in Control of the Company (as defined herein), the
Employee be able to continue his attention and dedication to his
duties and to assess and advise the Board of Directors of the
Company (the "Board") whether such proposals would be in the best
interest of the Company and its shareholders without distraction
regarding any uncertainty concerning his future with the Company;
and
WHEREAS, the Employee is willing to agree to continue
to serve the Company in the future;
NOW, THEREFORE, it is mutually agreed as follows:
1. Employment. The Company agrees to employ Employee,
and the Employee agrees to serve as an employee of the Company or
one or more of its subsidiaries after a Change of Control during
the Period of Employment (as those terms are defined in Section 2
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<PAGE>
hereof) in such executive capacity as Employee served immediately
prior to the Change in Control which caused the commencement of
the Period of Employment. The Employee also agrees to serve
during the Period of Employment, if elected or appointed thereto,
as a Director of the Board of Directors of the Company and as a
member of any committee of the Board of Directors. Notwith-
standing anything to the contrary herein, the Period of
Employment shall not commence and the Employee shall not be
entitled to any rights, benefits, or payments hereunder unless
and until a Change in Control has occurred.
2. Definitions.
(a) Cause. During the Period of Employment, "Cause"
means termination upon (i) the willful and continued failure by
the Employee to perform substantially his duties with the Company
(other than any such failure resulting from the Employee's
incapacity due to physical or mental illness) after a demand for
a substantial performance is delivered to the Employee by the
Chief Executive Officer of the Company ("CEO") which specifically
identifies the manner in which the CEO believes that the Employee
has not substantially performed his duties, or (ii) the willful
engaging by the Employee in illegal conduct which is materially
and demonstrably injurious to the Company. For purposes of this
Section 2(a), no act, or failure to act, on the part of the
Employee shall be considered "willful" unless done, or omitted to
be done, by the Employee in bad faith and without reasonable
belief that the Employee's action or omission was in, or not
Page 2
<PAGE>
opposed to, the best interests of the Company. Any act, or
failure to act, based upon authority given pursuant to a
resolution duly adopted by the Board or based upon the advice of
counsel for the Company shall be conclusively presumed to be
done, or omitted to be done, by the Employee in good faith and in
the best interests of the Company. Notwithstanding the
foregoing, the Employee shall not be deemed to have been
terminated for Cause unless and until there shall have been
delivered to the Employee a copy of a resolution duly adopted by
the affirmative vote of not less than three quarters of the
entire membership of the Board at a meeting of the Board called
and held for that purpose (after reasonable notice to the
Employee and an opportunity for him, together with counsel, to be
heard before the Board), finding that in the good faith opinion
of the Board the Employee was guilty of the conduct set forth
above in (i) or (ii) of this Section 2(a) and specifying the
particulars thereof in detail.
(b) Cash Compensation. "Cash Compensation" shall mean
the sum of (i) Employee's Base Salary (determined in accordance
with the provisions of Section 4(a) hereof) and (ii) Executive's
incentive compensation (provided for under Section 4(b) hereof),
which shall be an amount equal to the greatest of (x) the average
of the amount of Employee's incentive compensation for the last
three completed fiscal years immediately prior to the Employee's
termination of employment (whether or not such years occurred
during the Period of Employment), (y) the target amount of such
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<PAGE>
Employee's incentive compensation for the fiscal year in which
his termination of employment occurs or (z) the Employee's target
amount for the fiscal year in which the Change in Control occurs.
(c) Change in Control. "Change in Control" means the
occurrence of any of the following: an event that would be
required to be reported (assuming such event has not been
"previously reported") in response to Item 1(a) of the Current
Report on Form 8-K, as in effect on the date hereof, pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934;
provided, however, that, without limitation, such a Change in
Control shall be deemed to have occurred at such time as (i) any
"person" within the meaning of Section 14(d) of the Securities
Exchange Act of 1934 becomes the "beneficial owner" as defined in
Rule 13d-3 thereunder, directly or indirectly, of more than 25%
of the Company's Common Stock; (ii) during any two-year period,
individuals who constitute the Board of Directors of the Company
(the "Incumbent Board") as of the beginning of the period cease
for any reason to constitute at least a majority thereof,
provided that any person becoming a director during such period
whose election or nomination for election by the Company's
stockholders was approved by a vote of at least three quarters of
the Incumbent Board (either by a specific vote or by approval of
the proxy statement of the Company in which such person is named
as a nominee for director without objection to such nomination)
shall be, for purposes of this clause (ii), considered as though
such person were a member of the Incumbent Board; or (iii) the
Page 4
<PAGE>
approval by the Company's stockholders of the sale of all or
substantially all of the stock or assets of the Company.
(d) Disability. "Disability" means the absence of the
Employee from his duties with the Company on a full-time basis
for one hundred eighty (180) consecutive days as a result of
incapacity due to physical or mental illness.
(e) Good Reason. During the Period of Employment,
"Good Reason" means:
(i) an adverse change in the status of the Employee
(other than any such change primarily attributable to the fact
that the Company may no longer be publicly owned) or position(s)
as an officer of the Company as in effect immediately prior to
the Change in Control or the assignment to the Employee of any
duties or responsibilities which, in his reasonable judgment, are
inconsistent with such status or position(s), or any removal of
the Employee from or any failure to reappoint or reelect him to
such position(s) (except in connection with the termination of
the Employee's employment for Cause, Disability, or upon
attaining age 65 or upon taking early retirement under any of the
Company's retirement plans, or as a result of death or by the
Employee other than for Good Reason);
(ii) a reduction by the Company after a Change in
Control in the Employee's Base Salary;
(iii) a material reduction after a Change in Control
in the Employee's total annual compensation; provided, however,
that for these purposes a reduction for any year of over 10% of
Page 5
<PAGE>
total compensation measured by the preceding year without a
substantially similar reduction to all other executives
participating in incentive compensation plans shall be considered
"material"; and the failure of the Company to adopt or renew a
stock option plan or to grant amounts of restricted stock or
stock options, which are consistent with the Company's prior
practices, to the Employee shall also be considered a material
reduction, unless the Employee participates in substitute
programs that provide substantially equivalent economic value to
the Employee;
(iv) the failure by the Company to continue in effect
any Benefit Plan (as hereinafter defined) in which Employee was
participating at the time of the Change in Control (or Benefit
Plans providing Employee with at least substantially similar
benefits) other than as a result of the normal expiration of any
such Benefit Plan in accordance with its terms as in effect at
the time of the Change in Control, or the taking of any action,
or the failure to act, by the Company which would adversely
affect Employee's continued participation in any such Benefit
Plans on at least as favorable a basis to Employee as is the case
immediately prior to the Change in Control or which would
materially reduce Employee's benefits in the future under any of
such Benefit Plans or deprive Employee of any material benefit
enjoyed by Employee immediately prior to the Change in Control;
(v) the failure by the Company after a Change in
Control to provide and credit Employee with the number of paid
Page 6
<PAGE>
vacation days to which Employee was then entitled in accordance
with the Company's normal vacation policy as in effect
immediately prior to the Change in Control; or
(vi) the Company's requiring the Employee after a
Change in Control to be based more than fifty miles from the
Employee's principal place of business immediately prior to the
Change in Control except for required travel on the Company's
business to an extent substantially consistent with the business
travel obligations which he undertook on behalf of the Company
prior to the Change in Control.
(f) Period of Employment. (i) "Period of Employment"
means, subject to the provisions of Section 2(f)(ii), the period
of thirty-six (36) months commencing on the date of a Change in
Control (as defined in Section 2(c) hereof) and the period of any
extension or extensions thereof in accordance with the terms of
this Section. The Period of Employment shall be extended
automatically by one week for each week in which the Employee's
employment continues after the date of a Change in Control.
(ii) Notwithstanding the provisions of Section 2(f)(i)
hereof, the Period of Employment shall terminate upon the
occurrence of the earliest of (A) the Employee's attainment of
age 65, or the election by the Employee to retire early from the
Company under any of its retirement plans, (B) the death of the
Employee, (C) the Disability of the Employee or (D) a termination
of Employee's employment by the Company for Cause or by the
Employee without Good Reason.
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<PAGE>
(g) Termination Date. "Termination Date" means the
date on which the Period of Employment terminates.
3. Duties During the Period of Employment. While
employed by the Company during the Period of Employment, the
Employee shall devote his full business time, attention, and best
efforts to the affairs of the Company and its subsidiaries;
provided, however, that the Employee may engage in other
activities, such as activities involving charitable, educational,
religious, and similar types of organizations, speaking
engagements, membership on the board of directors of other
organizations, and similar types of activities to the extent that
such other activities do not prohibit the performance of his
duties under this Agreement, or inhibit or conflict in any
material way with the business of the Company and its
subsidiaries.
4. Current Cash Compensation.
(a) Base Salary. The Company will pay to the Employee
while employed by the Company during the Period of Employment an
annual base salary ("Base Salary") in an amount determined by the
Board of Directors or its Compensation Committee which shall
never be less than the greater of (i) the Employee's Base Salary
prior to the commencement of the Period of Employment or (ii) his
Base Salary during the preceding year of the Period of
Employment; provided, however, that it is agreed between the
parties that the Company shall review annually the Employee's
Base Salary, and in light of such review may, in the discretion
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of the Board of Directors or its Compensation Committee, increase
such Base Salary taking into account the Employee's responsi-
bilities, inflation in the cost of living, increase in salaries
of executives of other corporations, performance by the Employee,
and other pertinent factors. The Base Salary shall be paid in
substantially equal biweekly installments while Employee is
employed by the Company.
(b) Incentive Compensation. While employed by the
Company during the Period of Employment, the Employee shall
continue to participate in such of the Company's incentive
compensation programs for executives as the Employee participated
in prior to the commencement of the Period of Employment. Any
amount awarded to the Employee under such programs shall be paid
to Employee in accordance with the terms thereof.
5. Employee Benefits.
(a) Vacation and Sick Leave. The Employee shall be
entitled during the Period of Employment to a paid annual
vacation of not less than twenty (20) business days during each
calendar year while employed by the Company and to reasonable
sick leave.
(b) Regular Reimbursed Business Expenses. The Company
shall reimburse the Employee for all expenses and disbursements
reasonably incurred by the Employee in the performance of his
duties during the Period of Employment.
(c) Employment Benefit Plans or Arrangements. While
employed by the Company, Employee shall be entitled to
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<PAGE>
participate in all employee benefit plans, programs, or
arrangements ("Benefit Plans") of the Company, in accordance with
the terms thereof, as in effect from time to time, which provide
benefits to senior executives of the Company. For purposes of
this Agreement, Benefit Plans shall include, without limitation,
any compensation plan such as an incentive, deferred, stock
option or restricted stock plan, or any employee benefit plan
such as a thrift, pension, profit sharing, pre-tax savings,
medical, dental, disability, salary continuation, accident, life
insurance plan, or a relocation plan or policy, or any other
plan, program, or policy of the Company intended to benefit
employees.
6. Termination of Employment.
(a) Termination by the Company for Cause or
Termination by the Employee Other Than for Good Reason. If
during the Period of Employment the Company terminates the
employment of the Employee for Cause or if the Employee
terminates his employment other than for Good Reason the Company
shall pay the Employee (i) the Employee's Base Salary through the
end of the month in which the Termination Date occurs, (ii) any
incentive compensation payable to him pursuant to Section 4(b)
hereof, including a pro rata share for any partial year, (iii)
any accrued vacation pay, and (iv) benefits payable to him
pursuant to the Company's Benefit Plans as provided in Section
5(c) hereof through the end of the month in which the Termination
Date occurs. The amounts and benefits set forth in clauses (i),
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<PAGE>
(ii), (iii) and (iv) of the preceding sentence shall hereinafter
be referred to as "Accrued Benefits."
(b) Termination by the Company Without Cause or by the
Employee for Good Reason. If during the Period of Employment the
Company terminates the Employee's employment with the Company
without Cause or the Employee terminates his employment with the
Company for Good Reason, the Company will pay to Employee all
Accrued Benefits and, in addition, pay or provide to the Employee
the following:
(i) within thirty (30) days after the date of
termination, a lump sum equal to the greater of
(A) the Employee's Cash Compensation for the
remainder of the Period of Employment or (B) two
times the Employee's Cash Compensation;
(ii) for the greater of two years or the remainder of
the Period of Employment immediately following the
Employee's date of termination, the Employee and
Employee's family shall continue to participate in
any Benefit Plans of the Company (as defined in
Section 5(c) hereof) in which Employee or
Employee's family participated at any time during
the one-year period ending on the day immediately
preceding Employee's termination of employment,
provided that (a) such continued participation is
possible under the terms of such Benefit Plans, and
(b) the Employee continues to pay contributions for
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<PAGE>
such participation at the rates paid for similar
participation by active Company employees in
similar positions to that held by the Employee
immediately prior to the date of termination. If
such continued participation is not possible, the
Company shall provide, at its sole cost and
expense, substantially identical benefits to the
Employee plus pay an additional amount to the
Employee equal to the Employee's liability for
federal, state and local income taxes on any
amounts includible in the Employee's income by
virtue of the terms of this Section 6(b)(ii) so
that Employee does not have to personally pay any
federal, state and local income taxes by virtue of
the terms of this Section 6(b)(ii);
(iii) three additional years of service credit under the
Company's Non-Qualified Plans and, for purposes of
such plans, Employee's final average pay shall be
deemed to be his Cash Compensation for the year in
which the date of termination occurs;
(iv) the Company shall take all reasonable actions to
cause any Company restricted stock ("Restricted
Stock") granted to Employee to become fully vested
and any options to purchase Company stock
("Options") granted to Employee to become fully
exercisable, and in the event the Company cannot
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<PAGE>
effect such vesting or acceleration within sixty
(60) days, the Company shall pay within thirty
(30) days thereafter to Employee (i) with respect
to each Option, an amount equal to the product of
(x) the number of unvested shares subject to such
Option, multiplied by (y) the excess of the fair
market value of a share of Company common stock on
the date of Employee's termination of employment,
over the per share exercise price of such Option
and (ii) with respect to each unvested share of
Restricted Stock an amount equal to the fair
market value of a share of Company common stock on
the date of Employee's termination of employment.
Except as provided in the following sentence, the amounts payable
to the Employee under this Section 6(b) shall be absolutely owing
and shall not be subject to reduction or mitigation as a result
of employment of the Employee elsewhere after the date of
termination. Notwithstanding any provision herein to the
contrary, the benefits described in clauses (i), (ii) and (iii)
of this Section 6(b) shall only be payable with respect to the
period ending upon the earlier of (i) the end of the period
specified in each such clause or (ii) Employee's attainment of
age 65.
7. Gross-Up. In the event any amounts due to the
Employee under this Agreement after a Change in Control, under
the terms of any Benefit Plan, or otherwise payable by the
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<PAGE>
Company or an affiliate of the Company are subject to excise
taxes under Section 4999 of the Internal Revenue Code of 1986, as
amended ("Excise Taxes"), the Company shall pay to the Employee,
in addition to any other payments due under other provisions of
this Agreement, an amount equal to the amount of such Excise
Taxes plus the amount of any federal, state and local income or
other taxes and Excise Taxes attributable to all amounts,
including income taxes, payable under this Section 7, so that
after payment of all income, Excise and other taxes with respect
to the amounts due to the Employee under this Agreement, the
Employee will retain the same net after tax amount with respect
to such payments as if no Excise Taxes had been imposed.
8. Governing Law. This Agreement is governed by, and
is to be construed and enforced in accordance with, the laws of
the State of Connecticut. If under such laws any portion of this
Agreement is at any time deemed to be in conflict with any
applicable statute, rule, regulation, or ordinance, such portion
shall be deemed to be modified or altered to conform thereto or,
if that is not possible, to be omitted from this Agreement, and
the invalidity of any such portion shall not affect the force,
effect, and validity of the remaining portion hereof.
9. Notices. All notices under this Agreement shall be
in writing and shall be deemed effective when delivered in person
(in the Company's case, to its Secretary) or seventy-two (72)
hours after deposit thereof in the U.S. mail, postage prepaid,
for delivery as registered or certified mail -- addressed, in the
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<PAGE>
case of the Employee, to the Employee at Employee's residential
address, and in the case of the Company, to its corporate
headquarters, attention of the Secretary, or to such other
address as the Employee or the Company may designate in writing
at any time or from time to time to the other party. In lieu of
personal notice or notice by deposit in the U.S. mail, a party
may give notice by telegram, fax or telex.
10. Miscellaneous. This Agreement may be amended only
by a subsequent written agreement of the Employee and the
Company. This Agreement shall be binding upon and shall inure to
the benefit of the Employee, the Employee's heirs, executors,
administrators, beneficiaries, and assigns and to the benefit of
the Company and its successors. Notwithstanding anything in this
Agreement to the contrary, nothing herein shall prevent or
interfere with the ability of the Company to terminate the
employment of the Employee prior to a Change in Control nor be
construed to entitle Employee to be continued in employment prior
to a Change in Control and this Agreement shall terminate if
Employee or the Company terminates Employee's employment prior to
a Change in Control. Similarly, nothing herein shall prevent the
Employee from retiring under any of the Company's retirement
plans and receiving the corresponding benefits thereunder
consistent with the treatment of other Company employees.
11. Fees and Expenses. The Company shall pay all
reasonable legal fees and related expenses incurred by the
Employee in connection with this Agreement following a Change in
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<PAGE>
Control of the Company, including, without limitation, all such
fees and expenses, if any, incurred in connection with:
(i) contesting or disputing any termination of the Employee's
employment hereunder; or (ii) the Employee seeking to obtain or
enforce any right or benefit provided by the Agreement.
12. Arbitration. Any dispute or controversy arising
under or in connection with this Agreement shall be settled
exclusively by arbitration in Connecticut by three arbitrators in
accordance with the rules of the American Arbitration Association
then in effect. Judgment may be entered on the arbitrator's
award in any court having jurisdiction; provided, however, that
the Employee shall be entitled to be paid as if his or her
employment continued during the pendency of any dispute or
controversy arising under or in connection with this Agreement.
The Company shall bear all costs and expenses arising in
connection with any arbitration pursuant to this Section 12.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the year and day first above written.
THE PERKIN-ELMER CORPORATION
By: /s/ Tony L. White
Tony L. White
Chairman, President and
Chief Executive Officer
ATTEST:
By: /s/ W. B. Sawch
William B. Sawch
Vice President
General Counsel & Secretary
ACCEPTED AND AGREED:
/s/ Manuel A. Baez
Page 17
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>6
<DESCRIPTION>EXHIBIT 10(15) EMPLOYMENT AGREEMENT
<TEXT>
EMPLOYMENT AGREEMENT
AGREEMENT entered into as of June 20, 1996 between THE
PERKIN-ELMER CORPORATION, a New York corporation having its
principal place of business at Norwalk, Connecticut (the
"Company") and Dr. Mark C. Rogers, residing at 33 West Putnam
Avenue, 3G, Greenwich, CT 06830 (the "Employee").
WHEREAS, the Employee has rendered and/or will render
valuable services to the Company and it is regarded essential by
the Company that it have the benefit of Employee's services in
future years; and
WHEREAS, the Board of Directors of the Company believes
that it is essential that, in the event of the possibility of a
Change in Control of the Company (as defined herein), the
Employee be able to continue his attention and dedication to his
duties and to assess and advise the Board of Directors of the
Company (the "Board") whether such proposals would be in the best
interest of the Company and its shareholders without distraction
regarding any uncertainty concerning his future with the Company;
and
WHEREAS, the Employee is willing to agree to continue
to serve the Company in the future;
NOW, THEREFORE, it is mutually agreed as follows:
1. Employment. The Company agrees to employ Employee,
and the Employee agrees to serve as an employee of the Company or
one or more of its subsidiaries after a Change of Control during
the Period of Employment (as those terms are defined in Section 2
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<PAGE>
hereof) in such executive capacity as Employee served immediately
prior to the Change in Control which caused the commencement of
the Period of Employment. The Employee also agrees to serve
during the Period of Employment, if elected or appointed thereto,
as a Director of the Board of Directors of the Company and as a
member of any committee of the Board of Directors. Notwith-
standing anything to the contrary herein, the Period of
Employment shall not commence and the Employee shall not be
entitled to any rights, benefits, or payments hereunder unless
and until a Change in Control has occurred.
2. Definitions.
(a) Cause. During the Period of Employment, "Cause"
means termination upon (i) the willful and continued failure by
the Employee to perform substantially his duties with the Company
(other than any such failure resulting from the Employee's
incapacity due to physical or mental illness) after a demand for
a substantial performance is delivered to the Employee by the
Chief Executive Officer of the Company ("CEO") which specifically
identifies the manner in which the CEO believes that the Employee
has not substantially performed his duties, or (ii) the willful
engaging by the Employee in illegal conduct which is materially
and demonstrably injurious to the Company. For purposes of this
Section 2(a), no act, or failure to act, on the part of the
Employee shall be considered "willful" unless done, or omitted to
be done, by the Employee in bad faith and without reasonable
belief that the Employee's action or omission was in, or not
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<PAGE>
opposed to, the best interests of the Company. Any act, or
failure to act, based upon authority given pursuant to a
resolution duly adopted by the Board or based upon the advice of
counsel for the Company shall be conclusively presumed to be
done, or omitted to be done, by the Employee in good faith and in
the best interests of the Company. Notwithstanding the
foregoing, the Employee shall not be deemed to have been
terminated for Cause unless and until there shall have been
delivered to the Employee a copy of a resolution duly adopted by
the affirmative vote of not less than three quarters of the
entire membership of the Board at a meeting of the Board called
and held for that purpose (after reasonable notice to the
Employee and an opportunity for him, together with counsel, to be
heard before the Board), finding that in the good faith opinion
of the Board the Employee was guilty of the conduct set forth
above in (i) or (ii) of this Section 2(a) and specifying the
particulars thereof in detail.
(b) Cash Compensation. "Cash Compensation" shall mean
the sum of (i) Employee's Base Salary (determined in accordance
with the provisions of Section 4(a) hereof) and (ii) Executive's
incentive compensation (provided for under Section 4(b) hereof),
which shall be an amount equal to the greatest of (x) the average
of the amount of Employee's incentive compensation for the last
three completed fiscal years immediately prior to the Employee's
termination of employment (whether or not such years occurred
during the Period of Employment), (y) the target amount of such
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<PAGE>
Employee's incentive compensation for the fiscal year in which
his termination of employment occurs or (z) the Employee's target
amount for the fiscal year in which the Change in Control occurs.
(c) Change in Control. "Change in Control" means the
occurrence of any of the following: an event that would be
required to be reported (assuming such event has not been
"previously reported") in response to Item 1(a) of the Current
Report on Form 8-K, as in effect on the date hereof, pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934;
provided, however, that, without limitation, such a Change in
Control shall be deemed to have occurred at such time as (i) any
"person" within the meaning of Section 14(d) of the Securities
Exchange Act of 1934 becomes the "beneficial owner" as defined in
Rule 13d-3 thereunder, directly or indirectly, of more than 25%
of the Company's Common Stock; (ii) during any two-year period,
individuals who constitute the Board of Directors of the Company
(the "Incumbent Board") as of the beginning of the period cease
for any reason to constitute at least a majority thereof,
provided that any person becoming a director during such period
whose election or nomination for election by the Company's
stockholders was approved by a vote of at least three quarters of
the Incumbent Board (either by a specific vote or by approval of
the proxy statement of the Company in which such person is named
as a nominee for director without objection to such nomination)
shall be, for purposes of this clause (ii), considered as though
such person were a member of the Incumbent Board; or (iii) the
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<PAGE>
approval by the Company's stockholders of the sale of all or
substantially all of the stock or assets of the Company.
(d) Disability. "Disability" means the absence of the
Employee from his duties with the Company on a full-time basis
for one hundred eighty (180) consecutive days as a result of
incapacity due to physical or mental illness.
(e) Good Reason. During the Period of Employment,
"Good Reason" means:
(i) an adverse change in the status of the Employee
(other than any such change primarily attributable to the fact
that the Company may no longer be publicly owned) or position(s)
as an officer of the Company as in effect immediately prior to
the Change in Control or the assignment to the Employee of any
duties or responsibilities which, in his reasonable judgment, are
inconsistent with such status or position(s), or any removal of
the Employee from or any failure to reappoint or reelect him to
such position(s) (except in connection with the termination of
the Employee's employment for Cause, Disability, or upon
attaining age 65 or upon taking early retirement under any of the
Company's retirement plans, or as a result of death or by the
Employee other than for Good Reason);
(ii) a reduction by the Company after a Change in
Control in the Employee's Base Salary;
(iii) a material reduction after a Change in Control
in the Employee's total annual compensation; provided, however,
that for these purposes a reduction for any year of over 10% of
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<PAGE>
total compensation measured by the preceding year without a
substantially similar reduction to all other executives
participating in incentive compensation plans shall be considered
"material"; and the failure of the Company to adopt or renew a
stock option plan or to grant amounts of restricted stock or
stock options, which are consistent with the Company's prior
practices, to the Employee shall also be considered a material
reduction, unless the Employee participates in substitute
programs that provide substantially equivalent economic value to
the Employee;
(iv) the failure by the Company to continue in effect
any Benefit Plan (as hereinafter defined) in which Employee was
partici