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<SEC-DOCUMENT>0000077551-98-000016.txt : 19980928
<SEC-HEADER>0000077551-98-000016.hdr.sgml : 19980928
ACCESSION NUMBER: 0000077551-98-000016
CONFORMED SUBMISSION TYPE: 10-K
PUBLIC DOCUMENT COUNT: 9
CONFORMED PERIOD OF REPORT: 19980630
FILED AS OF DATE: 19980925
SROS: NYSE
SROS: PCX
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: 98714986
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, 1998
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 New York Stock Exchange
$1.00 per share) Pacific Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
Title of class
Class G Warrants
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 9, 1998, 49,395,010 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 $ 2,999,205,733.
DOCUMENTS INCORPORATED BY REFERENCE
Annual Report to Shareholders for Fiscal Year ended June 30,
1998 - Parts I, II, and IV.
Proxy Statement for Annual Meeting of Shareholders dated
September 9, 1998 - 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 markets life
science systems and analytical instruments used in the
pharmaceutical, biotechnology, environmental testing, food,
forensics, agriculture, and chemical manufacturing
industries. Registrant's industry segments are described in
Item 1.(c) below.
On November 21, 1997, Registrant acquired Molecular
Informatics, Inc., a developer of bioinformatics software
for the pharmaceutical, biotechnology, agrochemical,
forensics, and human identification markets.
On December 29, 1997, Registrant acquired approximately
52% of the voting rights and approximately 14.5% of the
equity of Tecan AG, a Swiss company. Tecan AG manufactures
and distributes laboratory automation systems for use in
life science and analytical applications.
On January 22, 1998, Registrant acquired PerSeptive
Biosystems, Inc. ("PerSeptive"). PerSeptive manufactures a
variety of products for use in the discovery, development,
and production of biopharmaceutical products.
On May 9, 1998, Registrant, Dr. J. Craig Venter, and
The Institute for Genomic Research ("TIGR") announced that
they had signed letters of intent to form a new genomics
company: Celera Genomics Corporation. The goal of Celera is
to become a primary source of genomic and medical
information to enable scientists to develop a better
understanding of human health and to facilitate the
discovery of therapeutics and diagnostics. The initial
focus is a plan to substantially complete the sequencing of
the human genome in three years. Results of operations
for Celera were not material for fiscal 1998.
On September 8, 1998, Registrant announced that it had
engaged consultants to explore strategic alternatives for
Registrant's Analytical Instruments Division. Options to be
explored include selling the business, spinning the division
off as a separate company, and retaining the division as
part of the Corporation. A decision with respect to the
various alternatives is expected by early in calendar year
1999.
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<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, 1998, 1997, and 1996 is incorporated
herein by reference to Note 6 on Pages 50-52 of the Annual
Report to Shareholders for the fiscal year ended June 30,
1998.
(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, forensics,
agriculture, and chemical manufacturing.
The Registrant's operations are comprised of three
business segments: its life sciences division, known as PE
Biosystems; its traditional Analytical Instruments business;
and the recently formed Celera Genomics Corporation.
Results of operations for Celera were not material for
fiscal 1998.
PE BIOSYSTEMS
Registrant's PE Biosystems Division develops,
manufactures, markets, sells, and services a wide range of
biochemical analytical instrument systems and products for
the biotechnology market, consisting of instruments,
associated reagents, consumables, and information management
tools.
All living organisms are composed of cells that contain
deoxyribonucleic acid ("DNA"). DNA contains information
that is used by cells as a blueprint for the organism. The
characteristics of any living thing essentially are
determined by the information in DNA. The components of DNA,
called genes, are further derived from combinations of four
different substances and usually contain between 1,000 and
100,000 instances of these substances. The entire set of
genes, called the genome, may contain between 4 million
(simple bacteria) and 3 billion (human) instances or more.
Combining DNA from different existing organisms
(plants, animals, insects, bacteria, etc.) results in
modified organisms with a combination of traits from the
parents. Scientists are now able to identify the specific
genes for many desirable traits and transfer only those
genes into another organism. Desirable traits found in
nature can theoretically be transferred into any chosen
organism. An organism genetically engineered in this way is
called transgenic. Genetic engineering is being used in
many practical situations.
One application of this technology is the development
of transgenic plants that are resistant to certain insects
or viruses. The genes for these traits have been
incorporated into the plants from other unrelated plants,
bacteria, or viruses by genetic engineering techniques.
Another use is in gene therapy, where, for
example, defective DNA in bone marrow cells is supplemented
with a copy of normal DNA, and the repaired cells are then
used by the body to generate cells with normal DNA.
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Another application is pharmaceutical production.
Drugs such as insulin for diabetics, growth hormone for
individuals with pituitary dwarfism, and tissue plasminogen
activator for heart attack victims, as well as animal drugs
like the growth hormones, bovine or porcine somatotropin,
are being produced by the fermentation of transgenic
bacteria that have received the appropriate human, cow, or
pig gene.
In addition to genetic engineering, DNA information is
also used in diagnostic applications. Individuals within
any given species, breed, or hybrid line can usually be
identified by minor differences in their DNA sequences.
Scientists can diagnose viral, bacterial, or fungal
infections, distinguish between closely related individuals,
or map the locations of specific genes along the vast length
of the DNA molecules in the cells.
Registrant's PE Biosystems Division -- consisting of
Applied Biosystems, PerSeptive Biosystems, PE Informatics,
Tropix, and PE GenScope -- provides the tools that enable
scientists to implement these applications.
Applied Biosystems
Applied Biosystems develops, manufactures, and markets
systems and services for polymerase chain reaction ("PCR"),
DNA sequencing, genetic analysis, protein analysis, nucleic
acid synthesis, and peptide synthesis. These systems and
services are used in both research and commercial
applications in purifying, analyzing, synthesizing, and
sequencing proteins and genetic material.
Registrant's Applied Biosystems' offerings can be
broadly classified into the following areas:
1. Genetic Analysis. Genetic analysis primarily uses
electrophoresis techniques for separating molecules
based on their differential mobility in an electric
field. Registrant's genetic analysis products
generally perform both DNA sequencing and fragment
analysis.
DNA sequencing is used to determine the exact order of
nucleotides 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
an electrophoresis gel and are detected at the bottom
of the gel. Registrant's DNA sequencing systems
include a sequencer expandable to 96 lanes, a single-
lane capillary sequencer, and sequencing reagents.
A newly developed product, the 3700 DNA Analyzer is
scheduled for production shipments during fiscal year
1999. This product is designed to enable applications
requiring tens of thousands of samples produced weekly
by combining proven capillary electrophoresis hardware
and separation polymer chemistry with new detection
technology and automation. It is expected to be the
enabling technology for the sequencing of the human
genome by Celera Genomics Corporation, as discussed
below.
DNA fragment analyzers are used to determine the size,
quantity, or pattern of DNA fragments generated by PCR
amplification or other means. Typically this is done
by using fluorescently tagged PCR primers to generate
labeled PCR products that are then analyzed
electrophoretically. Fragment analysis applications
include gene mapping and forensic typing using
microsatellite markers, single-strand conformation
polymorphism ("SSCP")
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<PAGE>
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 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, which is used for DNA sequencing primers and is
also used in drug discovery applications. Registrant
currently markets several models of synthesizers.
Registrant also provides custom synthesis, in which
oligonucleotides are made to order and shipped to
customers.
4. PNA. Registrant has an exclusive license for
technology to manufacture and sell peptide nucleic acid
("PNA") for molecular biology research and, subject to
certain limited reservations, for other applications.
PNA is a synthetic mimic of the DNA molecule with a
modified uncharged peptide-like "backbone." The unique
chemical structure of PNA enhances its affinity and
specificity as a DNA or RNA probe.
PerSeptive
PerSeptive develops, manufactures, and markets products
for the purification, analysis and synthesis of
biomolecules.
A variety of synthesis, purification, and analysis
procedures are conducted in each stage in the discovery,
development, and production of a biopharmaceutical product.
Synthesis involves the creation and replication of multiple
compounds that can be identical or subtly differentiated by
as little as one amino acid. Purification involves the
isolation and separation of a target biomolecule from other
substances, such as contaminants, without destroying the
biological activity of the biomolecule. Analysis involves
techniques used to measure the quantity of a biomolecule, to
identify its biological characteristics, and to assess the
nature and quantity of contaminants.
PerSeptive's products can be broadly classified into
the following categories:
1. Mass Spectrometry
Biospectrometry. PerSeptive owns a significant body of
technology relating to biological mass spectrometry
("Biospectrometry"). Although there are many different
kinds of mass spectrometers, most instruments are
defined by differences in two subsystems. One is the
ionization source that creates the ionic species, and
the other is the detection system. Biomolecular
analysis using mass spectrometry has been limited to
date by the inability of mass spectrometers to resolve
(identify) large biomolecules as well as the high cost
and difficulty of use of mass spectrometry. PerSeptive
believes that its Matrix-Assisted, Laser Desorption
Ionization Time-of-Flight Mass Spectrometry ("MALDI-
TOF/MS") technology overcomes the deficiencies of mass
spectrometry for biomolecular analysis.
Liquid Chromatography/Mass Spectrometry ("LC/MS").
LC/MS is a two stage analysis system which enables the
separation of a complex mixture and then the
quantitation and/or identification of the compounds in
the mixture. The component of the sample are first
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<PAGE>
separated in the chromatography stage and then the mass
spectrometer performs a molecular analysis, profiling
each molecule by its mass to charge ratio.
2. Perfusion Chromatography. PerSeptive's patented
Perfusion Chromatography process and media, which use
proprietary flow-through particles, separate
biomolecules 10 to 1,000 times faster than conventional
liquid chromatography ("LC") or high pressure liquid
chromatography ("HPLC") and achieve the same or better
levels of purity. Prior to the invention of Perfusion
Chromatography, it was generally accepted in the
chromatography industry that the slow speed of
diffusion was an inherent limitation to the potential
speed of chromatography.
3. ImmunoDetection. PerSeptive has developed novel
immunoassays that can be performed in a flow-through
column format ("ImmunoDetection"). ImmunoDetection
permits target molecule detection in seconds or minutes
-- far faster than conventional immunoassay techniques,
which require several hours to complete.
ImmunoDetection also takes advantage of the higher
degree of automation available in chromatography
instruments, as compared with immunoassay instruments,
and can produce results with much lower margins of
error.
4. Protein Synthesis and Analysis. Protein sequencers
provide information about the amino acids that make up
a given protein by chemically disassembling the protein
and analyzing the components. Peptide synthesizers
build peptides from amino acids through successive
reactions that 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 analogs.
5. Superparamagnetic Bead-Based Separations. PerSeptive
owns technology relating to magnetic separations
particles and processes. Magnetic separations enable
biomedical researchers to improve the speed, purity,
and yield of many common laboratory protocols,
including separation of cell populations and isolation
and purification of nucleic acids. Researchers can
perform techniques based on magnetic separation either
manually or with automated instruments.
6. Purification Products. PerSeptive's purification
products can be incorporated readily into any stage of
the development process of a biopharmaceutical product
and offer productivity advantages over conventional
counterparts. Companies using conventional
purification technology usually make several
significant changes in materials, equipment, and
processes in moving from the development stage to
commercial manufacture. As a result, an integrated
line of purification products is expected to enhance
productivity by reducing or eliminating these costly
and time-consuming changes. Moreover, because the U.S.
Food and Drug Administration ("FDA") must approve
significant changes in manufacturing processes, an
integrated line of purification products may simplify
and expedite the process of obtaining approvals from
the FDA.
Page 6
<PAGE>
PE Informatics
Registrant's PE Informatics business develops, markets,
and distributes bioinformatics software. Principal markets
include agricultural analysis, agrochemical, automotive
industries, petrochemical industries, clinical, and
biological analysis industries, environmental testing and
monitoring, materials research, food quality management,
pharmaceutical, and semiconductors. The products provide a
comprehensive software system researchers can use to manage
and analyze genome data and include software solutions for
science and medical professionals who analyze gene sequences
in an effort to discover and develop drugs, perform clinical
trials, and perform molecular diagnostics. These systems
are necessary to meet the demand to manage, integrate, and
analyze the vast amounts of information related to
bioscience discovery processes.
Bioinformatics is a new science that enables
researchers to transform massive amounts of data into an
organized knowledge database. Customers are typically
attempting breakthroughs in gene mapping, drug discovery,
drug development, and molecular diagnostics and these
products provide the vehicles for transforming raw data into
the organized body of knowledge that enables those
breakthrough discoveries. The business is dedicated to the
development of infrastructure software for pharmaceutical,
biotechnology, and agrochemical industries that perform
genome data collection and management, gene mapping, drug
discovery, and clinical and diagnostic genetic research.
PE Informatics currently provides genomic data
management products directed toward both discovery and
development.
Discovery oriented products include:
1. BioMerge. A product that allows research groups to
store, retrieve, and analyze genetic information. The
system consists of an advanced, object-oriented
relational database and a group of programs that
organize public, proprietary, and third-party data in a
single database. The system provides for editing and
annotating sequence data and for tracking change
history of the databases.
2. BioLIMS. A product that manages automated DNA
sequencing for Registrant's Applied Biosystems
products. Sequence analysis results are entered into a
central database and allows automated genetic
information management, from data acquisition to
assembled contiguous sequences.
3. SQL GT. A product for sample tracking and sample
management for high throughput laboratories.
Development oriented products include:
1. SQL Lims. A product designed to optimize
information processing and provide information
management tools for the analytical laboratory. It
provides tools for automating the laboratory's data
acquisition, processing, and archiving functions as
well as management information to aid in the planning
and control of laboratory resources.
2. TurboChrom. The TurboChrom Client/Server
Chromatography Data System delivers distributed
computing resources across an entire organization,
while managing key data processes centrally. It enables
users throughout an enterprise to access required
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information and to work collaboratively regardless of
geography, function, or local desktop environment.
Financial results from sales of SQL GT, SQL Lims and
TurboChrom products are currently reported in the
Analytical Instruments segment for the fiscal years
covered by the Annual Report to Shareholders for the
fiscal year ended June 30, 1998.
Tropix
Tropix develops, manufactures, and markets
chemiluminescent substrates and related products for the
life sciences market. Tropix also licenses its technology
to companies selling bioanalytical and clinical diagnostic
test kits.
Chemiluminescence is the conversion of chemical energy
stored within a molecule into light. Chemiluminescent
enzyme substrates are used that emit light in the presence
of a target substance that is "labeled," or connected to an
enzyme. The amount of light produced is proportional to the
amount of substrate or enzyme-labeled sample present. The
light lasts for a sufficiently long time to be measured with
instrumentation or photographic film. The substrates enable
the detection of extremely small amounts of virtually any
biological substance that can be detected. Chemiluminescent
technology is used in life science research and commercial
applications including drug discovery and development, gene
function study, molecular biology, and immunology research.
Another major use of this technology includes clinical
diagnostic tests for diseases, including early detection of
certain cancer markers.
Tropix operates a facility devoted to drug discovery
services for the pharmaceutical, biotech, and agricultural
markets. The services offered are custom assay development
using proprietary technologies and high-throughput
screening services with an initial capacity of 100,000
assays per day.
PE GenScope
PE GenScope offers customers advanced genomics
technologies including gene expression profiling, gene
discovery, high throughput DNA sequencing, complementary DNA
("cDNA") cloning, and bioinformatics, to accelerate their
drug discovery and development efforts.
PE GenScope has exclusive worldwide rights to AFLP (TM)
technology for human and animal healthcare applications.
AFLP technology was invented and patented by Keygene n.v. of
The Netherlands as a DNA fingerprinting technique for use in
genomics-based plant breeding programs and offers
substantial advantages over other gene fingerprinting
techniques. This technique is an enhancement of PCR that
allows selective analysis of any portion of genetic material
without the specific, prior sequence information normally
required for PCR.
PE GenScope products include gene expression profiling
technology that simultaneously discovers novel genes and
monitors known genes for applications such as molecular
toxicology, gene discovery, and pharmacogenomics. PE
GenScope also offers software and bioinformatics services
which allow clients to access vast amounts of proprietary
data via a secure Internet or Intranet connection, allowing
them to rapidly analyze and distribute information from
public and private sources throughout their global research
and development organizations.
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Joint Venture
Registrant is engaged in the manufacture and sale of
mass spectrometry instrument systems in a joint venture,
Perkin-Elmer Sciex Instruments. These products are sold by
both the PE Biosystems and Analytical Instruments Divisions.
ANALYTICAL INSTRUMENTS
Registrant's Analytical Instruments segment, consisting
of Registrant's Analytical Instruments Division, develops,
manufactures, markets, sells, and services analytical
instrument systems.
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.
Analytical chemistry is the science of experimentally
determining the elemental, 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,
chemicals, petrochemicals, material science, and
environmental industries, as well as in academic research.
Registrant's Analytical Instruments' 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 in
analyzing elements, compounds, or attributes, but typically
not more than one of these applications.
Registrant's Analytical Instruments' 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. These inductively coupled
plasma/mass spectrometers are provided by the joint
venture, Perkin-Elmer Sciex Instruments, referred to
previously.
3. Organic Analysis. These instruments are designed to
provide qualitative and quantitative information for
molecular and organic compounds in the broadest range
of samples.
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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.
CELERA GENOMICS CORPORATION
Registrant, Dr. J. Craig Venter, and TIGR announced on
May 9, 1998 that they had signed letters of intent relating
to the formation of a new genomics company now established
as Celera Genomics Corporation. Its strategy will be
centered on a plan to substantially complete the sequencing
of the human genome in three years.
The new company's goal is to become a primary source of
genomic and associated medical information that will be used
by scientists to develop a better understanding of the
biological processes in humans and to deliver improved
healthcare. Using DNA analysis technology developed by
Registrant's PE Biosystems Division, applied to sequencing
strategies pioneered by Dr. Venter and others at TIGR,
Celera will operate a genomics sequencing facility with an
expected capacity greater than that of the current combined
world output.
Concurrently, Celera also intends to build the
scientific expertise and informatics tools necessary to
extract biological knowledge from genomic data, including
the discovery of new genes, development of polymorphism
assay systems, and databases for the scientific community.
Registrant believes that this information has significant
commercial value and that Celera can provide this
information more rapidly and more accurately than is
currently possible.
MARKETING AND DISTRIBUTION
Registrant's PE Biosystems and Analytical Instruments
businesses employ similar marketing and distribution
practices. 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 are 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
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contracts. In certain cases, discontinuances of certain
sources could temporarily interrupt Registrant's business
in the PE Biosystems 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 that are incorporated in
Registrant's products or that fall within its fields of
interest. Certain licenses under patents have been granted
to, and received from, other entities. Registrant has
certain rights from the Roche Group under patents relating
to PCR, one of 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.
BACKLOG
Registrant's total recorded backlog at June 30, 1998
was $208.6 million, consisting of $116.1 million and $92.5
million for Registrant's PE Biosystems and Analytical
Instrument segments, respectively. At June 30, 1997
Registrant's total recorded backlog was $176.4 million, with
$86.2 million and $90.2 million for Registrant's PE
Biosystems and Analytical Instrument segements, respectively.
It is Registrant's general policy to include in backlog only
purchase orders or production releases that 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
1999.
UNITED STATES GOVERNMENT SALES
No material portion of either of Registrant's industry
segments is subject to re-negotiation 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 that
specialize in, and a number of larger companies that devote
a significant portion of their resources to, the
development, manufacture, and sale of products that 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
Page 11
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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 life science systems and analytical instruments. 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 1998, 1997, and 1996, Registrant spent
$161.0 million, $120.9 million, and $113.7 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 is currently a
party to environmental legal actions as disclosed in Item 3
below. Registrant believes any liability, and compliance
with all environmental regulations will have no material
effect on its business, and no material capital expenditures
are expected for environmental control.
EMPLOYEES
As of June 30, 1998, Registrant employed 7,188 persons
worldwide. None of Registrant's United States employees is
subject to collective bargaining agreements.
(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 1998, 1997, and 1996 is incorporated
herein by reference to Note 6 on Pages 50 - 52 of the Annual
Report to Shareholders for the fiscal year ended June 30,
1998.
Registrant's consolidated net revenues to unaffiliated
customers in countries other than the United States for the
fiscal years 1998, 1997, and 1996 were $880.2 million,
$841.2 million, and $779.9 million, or 57.5%, 61.3%, and
62.4%, respectively, of Registrant's consolidated net
revenues.
All of the Registrant's manufacturing facilities
outside the continental United States are located in
Germany, the United Kingdom, Japan, 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.
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<PAGE>
(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
selected financial data presents Registrant's Material
Sciences segment as a discontinued operation.
Item 2. PROPERTIES
Listed below are the principal facilities of Registrant
as of June 30, 1998. 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.
Approximate
PE BIOSYSTEMS Owned or Expiration Date Floor Area
Location Leased Date of Leases In Sq.Ft.
Davis, CA Leased 1999 13,365
Foster City, CA * Leased 1999-2007 543,000
San Jose, CA Owned 81,000
Bedford, MA Leased 2000 28,000
Framingham, MA Leased 2009 196,000
Santa Fe, NM Leased 1998-2005 14,000
Houston, TX Leased 1999 21,000
Salt Lake City, UT Leased 1999 8,000
Warrington, England Owned 22,000
Singapore Leased 1999 30,000
ANALYTICAL INSTRUMENTS Approximate
Owned or Expiration Date Floor Area
Location Leased Date of Leases In Sq.Ft.
Irvine, CA Owned 22,000
Norwalk, CT Owned 402,000
Wilton, CT Owned 221,000
Beaconsfield, England Owned 70,000
Beaconsfield, England Leased 2005 8,000
Llantrisant, Wales Leased ** 113,000
Meersburg, Germany Leased 2001 24,000
Ueberlingen, Germany Owned 60,000
Ueberlingen, Germany Leased 2001 121,000
* Comprising 3 principal facilities totaling 330,000
square feet, and additional facilities totaling 213,000
square feet.
** Leased on a month-to-month basis as the facility is
being closed.
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 warehouses. Registrant also owns undeveloped
land in Vacaville, California; and Ueberlingen, Germany.
Page 13
<PAGE>
In addition to the properties used by Registrant in its
operations, Registrant owns a facility in Wilton,
Connecticut (approximately 42,000 square feet) leased to a
third-party on a long-term basis.
Item 3. LEGAL PROCEEDINGS
Registrant 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 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. The claim against Registrant was brought
to trial in late spring 1998. The Court has not yet issued
a decision.
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, 1998, 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 1998 and 1997 (Note 13, Page 61 of
the Annual Report to Shareholders for the fiscal year ended
June 30, 1998).
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<PAGE>
(b) Holders.
On September 9, 1998, the approximate number of holders
of Common Stock of Registrant was 6,895. 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 during fiscal years
1998 and 1997 (Note 13, Page 61 of Registrant's Annual
Report to Shareholders for the fiscal year ended June 30,
1998) is hereby incorporated by reference in this Form 10-K.
(d) Sale of Unregistered Securities
Registrant has sold no securities during the fiscal
year ended June 30, 1998 that 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 29 of Registrant's Annual Report to
Shareholders for the fiscal year ended June 30, 1998.
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 30 - 38 of Registrant's Annual Report to
Shareholders for the fiscal year ended June 30, 1998.
Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK
Registrant hereby incorporates by reference in this
Form 10-K, Page 35 and Note 12 on Pages 58-60 of
Registrant's Annual Report to Shareholders for the fiscal
year ended June 30, 1998.
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, 1998 are incorporated by reference in this Form 10-K:
the Consolidated Financial Statements and the report thereon
of PricewaterhouseCoopers LLP dated July 31, 1998, and Pages
39-62 of said Annual Report, including Note 13, Page 61,
which contains unaudited quarterly financial information.
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<PAGE>
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, 1998, 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.
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 9, 1998, in connection with its Annual Meeting of
Shareholders to be held on October 15, 1998.
(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 9, 1998.
Name Age Present Positions and Year First Elected
Noubar B. Afeyan 36 Vice President (1998)
Manuel A. Baez 56 Senior Vice President and President,
Analytical Instruments Division (1996)
Peter Barrett 45 Vice President (1994), Executive Vice
President, Celera Genomics Corporation.(1998)
Ugo D. DeBlasi 36 Corporate Controller (1997)
Ronald D. Edelstein 49 Vice President and Chief
Information Officer (1998)
Elaine J. Heron 50 Vice President (1995),
General Manager Applied Biosystems (1998)
Michael W. Hunkapiller 49 Senior Vice President (1998);
President, PE Biosystems Division (1994)
Joseph E. Malandrakis 53 Vice President (1993),
General Manager, PerSeptive Biosystems (1998)
William B. Sawch 43 Senior Vice President,
General Counsel and Secretary (1993)
Tony L. White 52 Chairman, President, and
Chief Executive Officer (1995)
Dennis L. Winger 50 Senior Vice President and
Chief Financial Officer (1997)
Each of the foregoing named officers was either elected
at the last organizational meeting of the Board of Directors
held on October 16, 1997 or elected by the Board since that
date. The term of each officer will expire on October 15,
1998, the date of the next scheduled organizational meeting
of the Board of Directors, unless renewed for another year.
(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.
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<PAGE>
(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 9, 1998, in connection with its Annual Meeting of
Shareholders to be held on October 15, 1998. 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 Dr. Afeyan, Mr.
Baez, Mr. Edelstein, Dr. Heron, Mr. White, and Mr. Winger.
Dr. Afeyan was elected Vice President of Registrant on
February 19, 1998. Prior to his employment by Registrant in
January 1998, Dr. Afeyan founded PerSeptive, a manufacturer
of products for use in the discovery, development and
production of biopharmaceutical products, in 1987.
PerSeptive was acquired by Registrant in January 1998.
Before founding PerSeptive, he served as Technology Transfer
Officer for the Biotechnology Process Engineering Center at
The Massachusetts Institute of Technology which conducts
biotechnology research and education.
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., a manufacturer of health care products
and instruments, for 22 years, most recently as Executive
Vice President, International.
Mr. Edelstein was elected Vice President of Registrant
on June 18, 1998. Prior to his employment by Registrant in
June 1998, Mr. Edelstein served as Vice President and Chief
Information Officer of Witco Corporation, a manufacturer of
specialty chemicals, for seven years.
Dr. Heron was elected Vice President of Registrant on
December 21, 1995. She was most recently appointed Vice
President and General Manager of Registrant's Applied
Biosystems business in July 1998. Previously Dr. Heron
served as Vice President, Worldwide Sales, Service, and
Marketing since December 1995. She had served as Vice
President of Marketing at Affymetrix, Inc., a supplier of
genetic analysis equipment, for the year prior to this
appointment and previously was Director of Marketing for
Applied Biosystems beginning in 1990.
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 was elected Senior Vice President and Chief
Financial Officer on October 16, 1997. Prior to his
employment by Registrant in September 1997, Mr. Winger was
employed by Chiron Corporation, which conducts research and
development in the fields of biological proteins, gene
therapy and combinatorial chemistry, 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
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<PAGE>
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.
(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 9, 1998, in connection with its Annual Meeting of
Shareholders to be held on October 15, 1998.
Item 11. EXECUTIVE COMPENSATION
Registrant hereby incorporates by reference in this
Form 10-K, Pages 8-10 and 12-17 of Registrant's Proxy
Statement dated September 9, 1998, in connection with its
Annual Meeting of Shareholders to be held on October 15,
1998.
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 9, 1998, in connection with its Annual Meeting of
Shareholders to be held on October 15, 1998.
(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 9,
1998, in connection with its Annual Meeting of Shareholders
to be held on October 15, 1998.
(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
None.
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 PricewaterhouseCoopers
LLP dated July 31, 1998, appearing on Pages 39-62 of
Registrant's
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<PAGE>
Annual Report to Shareholders for the fiscal
year ended June 30, 1998, 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, 1998 is not to be deemed filed as
part of this report on Form 10-K.
Annual
10-K Page Report
No. Page No.
Consolidated Statements of
Operations - fiscal years
1998, 1997, and 1996................ -- 39
Consolidated Statements of
Financial Position at June 30,
1998 and 1997....................... -- 40
Consolidated Statements of
Cash Flows - fiscal years
1998, 1997, and 1996................ -- 41
Consolidated Statements of
Shareholders' Equity - fiscal years
1998, 1997, and 1996................ -- 42
Notes to Consolidated Financial
Statements.......................... -- 43-61
Report of Management.................. -- 62
Report of PricewaterhouseCoopers LLP.. -- 62
(a) 2. Financial Statement Schedule.
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, 1998. 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 Report
Page No. Page No.
Report of Independent Accountants
on Financial Statement Schedule 25 --
Schedule II - Valuation and
Qualifying Accounts and
Reserves 26 --
Page 19
<PAGE>
(a) 3. Exhibits.
Exhibit
No.
2(1) 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(2) Agreement and Plan of Merger, dated 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)).
2(3) Stock Option Agreement, dated as of August 23, 1997,
between the Company and PerSeptive Biosystems, Inc.
(incorporated by reference to Exhibit 10 to the
Company's Current Report on Form 8-K dated August 23,
1997 (Commission File No. 1-4389)).
3(i) Restated Certificate of Incorporation of the Company
(incorporated by reference to Exhibit 4.1 to the
Corporation's Registration Statement on Form S-3 (No.
333-39549)).
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 March 31, 1996 to the 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(2) to Annual
Report on Form 10-K of the Corporation for fiscal year
ended June 30, 1997 (Commission file number 1-4389)).
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) The Perkin-Elmer Corporation 1996 Employee Stock
Purchase Plan (incorporated by reference to Exhibit 99
to the Corporation's Registration Statement on Form S-8
(No. 333-15259)).*
10(6) The Perkin-Elmer Corporation 1997 Stock Incentive Plan
(incorporated by reference to Exhibit 99 to the
Company's Registration Statement on Form S-8 (No. 333-
38713)).*
10(7) PerSeptive Biosystems, Inc. 1989 Stock Plan, as amended
August 1, 1991 (incorporated by reference to Exhibit
3(i) of the Company's Quarterly Report on Form 10-Q for
the fiscal quarter ended March 31, 1998 (Commission File
No. 1-4389)).*
10(8) PerSeptive Biosystems, Inc. 1992 Stock Plan, as amended
January 20, 1997 (incorporated by reference to Exhibit
4.1 to the Quarterly Report on Form 10-Q of PerSeptive
Biosystems, Inc. for the fiscal quarter ended March 29,
1997 (Commission File No. 0-20032)).*
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<PAGE>
10(9) Molecular Informatics, Inc. 1997 Equity Ownership Plan
(incorporated by reference to Exhibit 99 to the
Corporation's Registration Statement on Form S-8 (No.
333-42683)).*
10(10) 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(11) Agreement dated June 3, 1996, between Registrant and
Manuel A. Baez (incorporated by reference to Exhibit
10(10) to Annual Report on Form 10-K of the Corporation
for the fiscal year ended June 30, 1997 (Commission file
number 1-4389)).*
10(12) 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(13) 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(14) 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(15) Employment Agreement dated June 20, 1996, between
Registrant and Manuel A. Baez (incorporated by
reference to Exhibit 10(14) to Annual Report on Form 10-
K of the Corporation for the fiscal year ended June 30,
1997 (Commission file number 1-4389)).*
10(16) Employment Agreement dated November 16, 1995, between
Registrant and William B. Sawch.*
10(17) Employment Agreement dated September 25, 1997, between
Registrant and Dennis L. Winger.*
10(18) Letter Agreement dated June 24, 1997, between Registrant
and Dennis L. Winger.*
10(19) Deferred Compensation Contract dated July 15, 1993
between Registrant and William B. Sawch.*
10(20) Pledge Agreement and Promissory Note between Registrant
and Michael W. Hunkapiller (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(21) 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(22) 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)).*
10(23) 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(24) 1993 Director Stock Purchase and Deferred Compensation
Plan as amended June 19, 1997 (incorporated by
reference to Exhibit 10(18) to Annual Report on Form 10-
K of the Corporation for the fiscal year ended June 30,
1997 (Commission file number 1-4389)).*
10(25) The Division Long-Term Incentive Plan of The Perkin-
Elmer Corporation dated July 1, 1996 (incorporated by
reference to Exhibit 10(20) to Annual Report on Form 10-
K of the Corporation for the fiscal year ended June 30,
1997 (Commission file number 1-4389)).*
10(26) The Performance Unit Bonus Plan of The Perkin-Elmer
Corporation (incorporated by reference to Exhibit
10(21) to Annual Report on Form 10-K of the Corporation
for the fiscal year ended June 30, 1997 (Commission file
number 1-4389)).*
10(27) The Estate Enhancement Plan of The Perkin-Elmer
Corporation (incorporated by reference to Exhibit
10(22) to Annual Report on Form 10-K of the Corporation
for the fiscal year ended June 30, 1997 (Commission file
number 1-4389)).
10(28) Deferred Compensation Plan, as amended and restated
effective as of January 1, 1998 (incorporated by
reference to Exhibit 4 to the Company's Registration
Statement on Form S-8 (No. 333-45187)).*
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<PAGE>
11 Computation of Net Income (Loss) per Share for the three
years ended June 30, 1998 (incorporated by reference to
Note 1 to Consolidated Financial Statements of Annual
Report to Shareholders for the fiscal year ended June
30, 1998).
13 Annual Report to Shareholders for 1998 (to the extent
incorporated herein by reference).
21 List of Subsidiaries.
23 Consent of PricewaterhouseCoopers LLP.
27 Financial Data Schedule.
* Management contract or compensatory plan or arrangement.
Note: None of the Exhibits listed in Item 14(a) 3 above,
except Exhibit 23, is 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 filed Amendment No. 1 to Form 8-K on April
6, 1998, responding to Items 2 and 7 on Form 8-K dated
January 22, 1998. The amendment included the following
financial statements:
Consolidated Balance Sheets at December 27, 1997 and September
30, 1997
Consolidated Statements of Operations for the Three months ended
December 27, 1997 and December 28, 1996
Consolidated Statements of Cash Flows for the Three months ended
December 27, 1997 and December 28, 1996
Notes to Unaudited Consolidated Financial Statements
Introduction to Unaudited Pro Forma Condensed Combined Financial
Statements
Unaudited Pro Forma Condensed Combined Statements of Financial
Position at December 31, 1997
Unaudited Pro Forma Condensed Combined Statements of Operations
for the Six months ended December 31, 1997
Unaudited Pro Forma Condensed Combined Statements of Operations
for the Six months ended December 31, 1996
Unaudited Pro Forma Condensed Combined Statements of Operations
for the fiscal years ended June 30, 1997, 1996 and 1995
Notes to Unaudited Pro Forma Condensed Combined Financial
Statements
Page 22
<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/ William B. Sawch
William B. Sawch
Vice President, General
Counsel and Secretary
Date: September 21, 1998
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 22, 1998
Tony L. White
Chairman of the Board of Directors, President
and Chief Executive Officer
(Principal Executive Officer)
/s/ Dennis L. Winger September 21, 1998
Dennis L. Winger
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
/s/ Ugo D. DeBlasi September 22, 1998
Ugo D. DeBlasi
Corporate Controller
(Principal Accounting Officer)
/s/ Joseph F. Abely, Jr. September 16, 1998
Joseph F. Abely, Jr.
Director
Page 23
<PAGE>
/s/ Richard H. Ayers September 17, 1998
Richard H. Ayers
Director
/s/ Jean-Luc Belingard September 17, 1998
Jean-Luc Belingard
Director
/s/ Robert H. Hayes September 17, 1998
Robert H. Hayes
Director
/s/ Georges C. St. Laurent, Jr. September 16, 1998
Georges C. St. Laurent, Jr.
Director
/s/ Carolyn W. Slayman September 17, 1998
Carolyn W. Slayman
Director
/s/ Orin R. Smith September 17, 1998
Orin R. Smith
Director
Page 24
<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 31, 1998, appearing on
Page 62 of the 1998 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.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Stamford, Connecticut
July 31, 1998
Page 25
<PAGE>
THE PERKIN-ELMER CORPORATION
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
FOR THE FISCAL YEARS ENDED JUNE 30, 1998, 1997, AND 1996
(Amounts in thousands)
ALLOWANCE FOR
DOUBTFUL ACCOUNTS
Balance at June 30,1995........................ $ 10,648
Charged to income in fiscal year 1996.......... 2,365
Deductions from reserve in fiscal year 1996.... (3,782)
Balance at June 30, 1996....................... 9,231
Charged to income in fiscal year 1997.......... 1,187
Deductions from reserve in fiscal year 1997.... (3,011)
Balance at June 30, 1997 (1)................... 7,407
Charged to income in fiscal year 1998.......... 4,673
Acquired businesses (2)........................ 495
Deductions from reserve in fiscal year 1998.... (3,298)
Balance at June 30, 1998 (1)................... $ 9,277
(1) Deducted in the Consolidated Statements of Financial
Position from accounts receivable.
(2) See Note 2 to the Consolidated Financial Statements.
SCHEDULE II
Page 26
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in
the Registration Statements on Form S-3 (No. 333-39549) and
Form S-8 (Nos. 2-95451, 33-25218, 33-44191, 33-50847, 33-
50849, 33-58778, 333-15189, 333-152259, 333-38713, 333-
38881, 333-42683, and 333-45187) of The Perkin-Elmer
Corporation of our report dated July 31, 1998, 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 25
of this Form 10-K.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Stamford, Connecticut
September 25, 1998
EXHIBIT 23
Page 27
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
10(16) Employment Agreement dated November 16, 1995,
between Registrant and William B. Sawch.
10(17) Employment Agreement dated September 25, 1997,
between Registrant and Dennis L. Winger.
10(18) Letter Agreement dated June 24, 1997,
between Registrant and Dennis L. Winger.
10(19) Deferred Compensation Contract dated July 15, 1993
between Registrant and William B. Sawch.
13 Annual Report to Shareholders for the fiscal year
ended June 30, 1998 (to the extent incorporated
herein by reference).
21 List of Subsidiaries.
23 Consent of PricewaterhouseCoopers LLP.
27 Financial Data Schedule.
Page 28
<PAGE>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>2
<DESCRIPTION>EX-10(16) EMPLOYMENT AGREEMENT
<TEXT>
EMPLOYMENT AGREEMENT
AGREEMENT entered into as of November 16, 1995, between
THE PERKIN-ELMER CORPORATION, a New York corporation having its
principal place of business at Norwalk, Connecticut (the
"Company") and William B. Sawch residing at 146 Lyons Plains
Road, Weston, Connecticut 06883 (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
Page 1
<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
Page 3
<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.
Page 7
<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
Page 8
<PAGE>
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
Page 9
<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),
Page 10
<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
Page 11
<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
Page 12
<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
Page 13
<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
Page 14
<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 shall supersede the
prior Employment Agreement dated November 21, 1991, with the
Employee. 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.
Page 15
<PAGE>
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
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.
Page 16
<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/ Michael J. McPartland
Michael J. McPartland
Vice President
ACCEPTED AND AGREED:
/s/ W.B. Sawch
William B. Sawch
Page 17
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<DESCRIPTION>EX-10(17) EMPLOYMENT AGREEMENT
<TEXT>
EMPLOYMENT AGREEMENT
AGREEMENT entered into as of September 25, 1997,
between THE PERKIN-ELMER CORPORATION, a New York corporation
having its principal place of business at Norwalk, Connecticut
(the "Company") and Dennis L. Winger, residing at 19 Prospect
Ridge, Quail Ridge Unit 56, Ridgefield, CT 06877 (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
Page 1
<PAGE>
the Period of Employment (as those terms are defined in Section 2
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
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belief that the Employee's action or omission was in, or not
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) Employee'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
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during the Period of Employment), (y) the target amount of such
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
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such person were a member of the Incumbent Board; or (iii) the
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,
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that for these purposes a reduction for any year of over 10% of
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 was 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;
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(v) the failure by the Company after a Change in
Control to provide and credit Employee with the number of paid
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
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of Employee's employment by the Company for Cause or by the
Employee without Good Reason.
(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
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parties that the Company shall review annually the Employee's
Base Salary, 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 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.
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(c) Employment Benefit Plans or Arrangements. While
employed by the Company, Employee 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 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
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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), (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