SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------------------------
AMENDMENT NO. 1 ON FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report
(Date of earliest event reported):
June 12, 1998
----------------------------------------
THERMO SENTRON INC.
(Exact name of Registrant as specified in its charter)
Delaware 1-14254 41-1827303
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification Number)
incorporation or organization)
501 90th Avenue N.W.
Minneapolis, Minnesota 55433
(Address of principal executive offices) (Zip Code)
(781) 622-1000
(Registrant's telephone number
including area code)
<PAGE>
FORM 8-K/A
Item 2. Acquisition or Disposition of Assets
On June 12, 1998, Thermo Sentron Inc. (the Company) acquired the three
businesses that constitute the Graseby product-monitoring group (Graseby Product
Monitoring) from Graseby Limited (the Seller). The businesses acquired design,
manufacture, and distribute specialized packaged-goods equipment, including
checkweighers and metal detectors, primarily for use by food producers and
pharmaceutical companies.
The acquisition was made pursuant to an Agreement dated March 13, 1998 (as
amended, the Agreement), between the Seller, the Company, and Thermo
Environmental Instruments Inc., which acquired a separate business of the
Seller. Smiths Industries plc, the parent company of the Seller, and Thermo
Electron Corporation, the indirect parent company of the Company and of Thermo
Environmental Instruments Inc., guaranteed the respective obligations of the
parties.
The purchase price of Graseby Product Monitoring was approximately $44
million, net of cash acquired. The purchase price is subject to a post-closing
adjustment equal to the amount by which the net operating assets (excluding cash
balances and certain other identified items) of Graseby Product Monitoring as of
the closing date are greater or less than, as the case may be, certain target
amounts set forth in the Agreement.
The consideration paid for Graseby Product Monitoring was based on the
Company's determination of the fair market value of Graseby Product Monitoring's
business, and the terms of the Agreement were determined by arms-length
negotiation among the parties.
To partially finance the acquisition, the Company borrowed $21.0 million
from Thermo Electron. The indebtedness to Thermo Electron bears interest at a
rate equal to the 90-day Commercial Paper Composite Rate plus 25 basis points,
set at the beginning of each quarter, and is due December 15, 1998.
The Company has no present intention to use the assets of Graseby Product
Monitoring for purposes materially different from the purposes for which such
assets were used prior to the acquisition. However, the Company will review such
business's assets, corporate structure, capitalization, operations, properties,
policies, management and personnel and, upon completion of this review, may
develop additional or alternative plans or proposals, including mergers,
transfers of a material amount of assets or other additional transactions or
changes relating to such business.
2
<PAGE>
Item 7. Financial Statements, Pro Forma Combined Condensed Financial
Information and Exhibits
(a) Financial Statements of Business Acquired: Attached hereto
3
<PAGE>
PRODUCT MONITORING GROUP
TABLE OF CONTENTS
Page Number
Auditors' Report 2
Combined Profit and Loss Account 3
Combined Balance Sheet 4
Combined Statement of Cash Flows 5
Notes to the Combined Accounts 6
<PAGE>
PRODUCT MONITORING GROUP
REPORT OF INDEPENDENT AUDITORS
To the Board of Directors of Product Monitoring Group
We have audited the accompanying combined balance sheet of the Product
Monitoring Group and its subsidiaries ("the Company") as of 1 October 1997 and
the related combined profit and loss account, and combined statement of cash
flows for the nine month period then ended, all expressed in British pounds
sterling and prepared on the basis set forth in Note 1 to the combined financial
statements. These financial statements set out on pages 3 through 21 are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audit in accordance with United Kingdom generally accepted
auditing standards which do not differ in any material respect from auditing
standards generally accepted in the United States. Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the combined financial statements referred to above present
fairly, in all material respects, the financial position of the Company as of 1
October 1997 and the result of the Company's operations and its cash flows for
the nine month period then ended in conformity with generally accepted
accounting principles in the United Kingdom.
Accounting principles generally accepted in the United Kingdom differ in certain
significant respects from accounting principles generally accepted in the United
States. The application of the latter would have affected the determination of
the combined loss for the nine month period ended 1 October 1997 and the
determination of combined financial position as of 1 October 1997. Note 27 to
the combined financial statements summarizes this effect for the nine month
period ended 1 October 1997.
PricewaterhouseCoopers
London, England
24 August 1998
2
<PAGE>
PRODUCT MONITORING GROUP
COMBINED PROFIT AND LOSS ACCOUNT
For the nine months ended 1st October 1997
Continuing
Operations
9 Months to
1 October 1997
(In thousands of British pounds sterling)
Notes
4 TURNOVER 20,766
Cost of Sales (12,371)
-------
Gross Profit 8,395
Other Operating Income -
-------
8,395
2 Operating expenses (8,384)
-------
OPERATING PROFIT 11
3 Net interest 69
-------
PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION 80
6 Tax on profit on ordinary activities (359)
-------
LOSS ON ORDINARY ACTIVITIES AFTER TAXATION (279)
21 Dividend Paid -
-------
RETAINED LOSS (279)
=======
The loss for 1997 is stated on the historical cost basis.
Thereis no difference between the loss on ordinary activities
before taxation and the retained loss for the period stated above and
their historical cost equivalent.
STATEMENT OF TOTAL RECOGNIZED GAINS AND LOSSES
(In thousands of British pounds sterling)
Loss for the financial period (279)
Currency translation differences of foreign currency
net investments 137
-------
Total recognized gains and losses relating to the period (142)
=======
The notes on pages 6 to 21 form an integral part of these accounts.
3
<PAGE>
PRODUCT MONITORING GROUP
COMBINED BALANCE SHEET at 1st October 1997
1 October 1997
Notes (In thousands of British pounds sterling)
FIXED ASSETS
7 Tangible assets 1,102
22 Investments 3
------
1,105
------
CURRENT ASSETS
8 Stocks 4,810
9 Debtors - amounts falling due within one year 4,906
- amounts falling due after more than one year 3,514
Cash at bank and in hand 2,395
------
15,625
10 Creditors - amounts falling due within one year (5,690)
11 Provision for liabilities and charges (187)
------
NET CURRENT ASSETS 9,748
------
TOTAL ASSETS LESS CURRENT LIABILITIES 10,853
======
CAPITAL & RESERVES
13 Combined share capital 1,471
14 Share premium account 3,575
23 Profit and loss account 4,287
------
EQUITY SHAREHOLDERS FUNDS 9,333
25 Non-equity shareholders funds 1,520
------
TOTAL SHAREHOLDERS FUNDS 10,853
======
The report of the auditors is on page 2.
The notes on pages 6 to 21 form an integral part of these accounts.
4
<PAGE>
PRODUCT MONITORING GROUP
COMBINED STATEMENT OF CASH FLOWS THROUGH 1st October 1997
1 October 1997
Notes (In thousands of British pounds sterling)
24(a) Net Cash Flow from Operating Activities 131
Returns on Investments and Servicing of
Finance:
Interest Received 69
------
Net Cash Inflow for Returns on Investments 69
Taxation: (764)
Capital Expenditure and Financial Investment:
Purchase of Tangible Fixed Assets (481)
Sale of Plant and Machinery 7
------
Net Cash Outflow for Capital Expenditure and
Financial Investment (474)
------
Cash Outflow Before Use of Liquid Resources
and Financing (1,038)
Management of Liquid Resources:
Increase in Long-term Receivables (544)
Financing-Debt Due Within One Year:
Increase in Short-term Borrowings 1,090
------
24(b) Decrease in Cash in the Period (492)
======
5
<PAGE>
PRODUCT MONITORING GROUP
NOTES TO THE COMBINED ACCOUNTS
1.BUSINESS OPERATIONS, BASIS OF PRESENTATION AND PRINCIPAL ACCOUNTING
POLICIES
The combined financial statements have been prepared in accordance with
applicable accounting standards in the United Kingdom. A summary of the more
important accounting policies, which have been applied consistently, is set out
below.
a) Business Operations and basis of presentation
These combined financial statements were prepared in connection
with the acquisition of the checkweighing, metal detection, x-ray and
coding businesses of Graseby plc (collectively referred to as the
"Product Monitoring Group" or the "Company") purchased from Smiths
Industries plc ("Smiths") by Thermo Sentron Inc. ("Thermo"). The
Company was acquired by Smiths on 2 October 1997 upon completion of
its acquisition of Graseby plc. On 12 June 1998, the Company was
acquired from Smiths by Thermo.
The principal activities of the Company are the design,
manufacture and sale of contact coding products used to print variable
information onto products and packaging, and the design, manufacture
and sale of equipment and systems principally used by food and
pharmaceutical producers to identify and reject contaminated or
irregular products.
These combined financial statements reflect the combined balance
sheet, profit and loss account and statement of cash flows of the
Company for the nine months ended 1 October 1997. All significant
intercompany transactions are eliminated in combination. The financial
statements of the Companies' businesses are denominated in the local
foreign currency as the designated functional currency. The
businesses' assets and liabilities have been translated to pounds
sterling at the respective exchange rates prevailing at the balance
sheet date. The businesses' profit and loss accounts have been
translated at the respective average exchange rates for the year.
b) Accounting convention
The accounts have been prepared in accordance with the historical
cost convention.
c) Foreign currency
Exchange profits less losses resulting from the period's trading
are accounted for in the result for the period.
Assets and liabilities expressed in foreign currencies are
translated to sterling at rates of exchange ruling at the end of the
financial period or at forward rates where covered by forward exchange
contracts.
6
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
d) Fixed assets
Fixed assets are stated at historical cost less depreciation.
e) Depreciation
Depreciation of fixed assets is provided on a straight line basis
at such rates that will write off the cost of the assets over their
expected useful working lives.
The principal annual rates used for this purpose are:
Plant and machinery 10% to 33% on cost
Fixtures and fittings 10% to 33% on cost
Motor vehicles 25% to 33% on cost
Long leasehold property over the period to the
next rent review
Leasehold additions 5% to 20% on cost
f) Stocks
Stock and work in progress are stated at the lower of cost and
net realizable value, with provision being made, where necessary, for
obsolete, slow-moving and defective stocks. Cost is determined on the
first in first out basis and includes material, direct labor and
overheads appropriate to the relevant stage of production. Net
realizable value represents the estimated amount at which stocks and
work in progress will be realized after taking into account relevant
marketing, selling and distribution costs.
g) Debtors
Debtors are stated after making such provision as is considered
necessary to cover the risk of bad debts.
h) Deferred taxation
No provision is made or asset recognized for deferred taxation
unless, in the opinion of the directors, there is a reasonable
probability that the relevant amount will crystallise in the
foreseeable future.
i) Research and development
All expenditure for research and development is charged to profit
and loss account as incurred.
7
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
j) Pension scheme arrangements
The company participates in a group pension scheme operated by
Graseby plc. Contributions and pension costs are based on pension
costs across the group as a whole. Pension costs are accounted for on
the basis of charging in each accounting period, the regular cost,
i.e. the consistent ongoing costs of providing pensions over the
period during which the company benefits from the employees' services,
adjusted for any variations in cost arising from the experience of the
scheme. The effects of variations from regular cost are spread over
the expected remaining working lifetime of members of the scheme.
2. OPERATING EXPENSES
9 Months to
1 October 1997
(In thousands of British pounds sterling)
Net operating expenses comprise:-
Distribution costs 3,429
Administration expenses 4,955
-----
8,384
======
3. NET INTEREST RECEIVABLE/(PAYABLE) AND SIMILAR INCOME
9 Months to
1 October 1997
(In thousands of British pounds sterling)
Interest (Payable)/Receivable 69
======
4. TURNOVER & PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION
9 Months to
1 October 1997
(In thousands of British pounds sterling)
The geographical split of turnover in the year was
as follows:-
United Kingdom 6,819
Rest of Europe 4,033
U.S.A. 6,185
Canada 2,096
Other overseas countries 1,633
-------
20,766
=======
8
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
The geographical split of profit on ordinary activities before
tax in the year was as follows:
United Kingdom (852)
Rest of Europe (255)
U.S.A. 878
Canada 303
Other overseas countries 6
-------
80
=======
The geographical split of net assets at the end of the year was as
follows:
United Kingdom 7,182
Rest of Europe (522)
U.S.A. 2,901
Canada 1,110
Other overseas countries 182
-------
10,853
=======
Loss on ordinary activities has been arrived at after charging:
Depreciation of fixed assets 396
Auditors' remuneration for audit work 101
Operating lease rentals:
- plant, machinery and vehicles 274
- land and buildings 213
The split of turnover between product lines was as follows:
Turnover - Product Inspection 17,533
Turnover - Coding Equipment 3,233
------
20,766
======
The split of profit on ordinary activities before tax between product
lines was as follows:
Loss Before Tax - Product Inspection (379)
Profit Before Tax - Coding Equipment 459
------
80
======
The split of net assets between product lines was as follows:
Net Assets - Product Inspection 9,426
Net Assets - Coding Equipment 1,427
------
10,853
======
9
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
5. DIRECTORS AND OTHER EMPLOYEES
All directors have been employed as managers by Graseby plc and
are remunerated by that company in respect of their services to the
group as a whole. They receive no emoluments from this Company,
although Graseby plc makes a charge to the company in respect of
management and other services, which charge is included in these
accounts.
Directors' Emoluments:
9 Months to
1 October 1997
(In thousands of British pounds sterling)
Emoluments for services as directors to the
Product Monitoring Group paid by another
group undertaking (excluding pension contributions) 231
Company contributions -
---
Company contribution to defined benefit scheme 231
===
Excluding pension contributions, the emoluments of the highest
paid director were 57,666 British pounds sterling.
There are 11 directors for whom retirement benefits are accruing
in the defined benefit scheme referred to in note 15.
The average number of persons, including directors, employed by
the Company during the period was as follows:
9 Months to
1 October 1997
Number
Production 205
Selling, Distribution and Administration 128
-----
333
=====
9 Months to
1 October 1997
(In thousands of British pounds sterling)
Staff Costs:
Wages and salaries 4,670
Social security costs 392
Other pension costs 184
-----
5,246
=====
10
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
6. TAX ON PROFIT ON ORDINARY ACTIVITIES
9 Months to
1 October 1997
(In thousands of British pounds sterling)
Corporation tax based on profits for the period
at 31.67% (25)
Deferred taxation (334)
----
(359)
====
7 TANGIBLE ASSETS
Short Fixtures,
Long leasehold leasehold plant &
buildings buildings vehicles Total
(In thousands of British pounds sterling)
Cost:
At 31st December 1996 531 53 2,706 3,290
Additions - 3 478 481
Disposal - - (413) (413)
----- ----- ----- -----
At 1st October 1997 531 56 2,771 3,358
----- ----- ----- -----
Depreciation:
At 31st December 1996 367 32 1,855 2,254
Charge for period 45 7 344 396
Disposals - - (394) (394)
----- ----- ----- -----
At 1st October 1997 412 39 1,805 2,256
----- ----- ----- -----
Net book value:
At 1st October 1997 119 17 966 1,102
===== ===== ===== =====
At 31st December 1996 164 21 851 1,036
===== ===== ===== =====
8. STOCKS AND WORK IN PROGRESS
1 October 1997
(In thousands of British pounds sterling)
Raw materials and consumables 1,959
Work in progress 701
Finished goods 2,150
-----
4,810
=====
11
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
9. DEBTORS
1 October 1997
(In thousands of British pounds sterling)
Amounts recoverable within one year:
Trade debtors 4,379
Prepayments and accrued income 527
-----
4,906
=====
Amounts recoverable after one year:
Group Loans:
Immediate holding company 3,514
=====
The directors regard the Group Loans as long term in nature as
there is no fixed repayment date, although the balance may fluctuate
in the short term. Of the balance outstanding at the end of the
financial period, 305,000 British pounds sterling bears a finance
charge varying with market rates.
10. CREDITORS - amounts falling due within one year 1 October 1997 (In
thousands of British pounds sterling)
Bank overdraft 1,619
Trade creditors 2,801
Accruals and deferred income 908
Social security and other taxes payable 47
Corporate tax payable 315
-----
5,690
=====
The bank overdraft is secured by cross guarantees from other
participating companies in the joint bankers arrangements.
11. PROVISION FOR LIABILITIES AND CHARGES
Includes the following:
Restructuring Warranty
Costs Costs Total
(In thousands of British pounds sterling)
At 31st December 1996 70 98 168
Profit and Loss Account (3) 22 19
--- --- ---
At 1st October 1997 67 120 187
=== === ===
12
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
12. DEFERRED TAXATION
The potential liability to deferred tax, calculated under the
liability method together with the element for which provision has
been recognized or made in the accounts, is analyzed below.
1 October 1997
Full Recognized
Potential in accounts
(asset)/
liability
(In thousands of British pounds sterling)
Accelerated capital allowances (156) -
Other short-term timing
differences (253) -
---- ----
(409) -
==== ====
13. COMBINED SHARE CAPITAL
The combined share capital represents the aggregate share capital
of the companies in the Product Monitoring Group, as follows:
-Graseby Product Monitoring Limited
-Graseby Allen Limited
-Graseby Goring Kerr GmbH
-Graseby Goring Kerr (NZ) Limited
-Goring Kerr Detection Limited
-Graseby Goring Kerr (Canada) Inc.
14. SHARE PREMIUM ACCOUNT
(In thousands of British pounds sterling)
At 1 October 1997 and 31 December 1996 3,575
=====
This represents the share premium account in Graseby Product
Monitoring Limited.
15. PENSION COMMITMENTS
The Company participated in a group defined benefit pension
scheme. The funds of the Graseby scheme are administered by trustees
and are separate from the group. The funds are valued every three
years by professionally qualified independent actuaries, the rates of
contribution being determined by the actuaries. In the intervening
years the actuaries review the continuing appropriateness of the
rates. The latest actuarial valuation of the scheme was 31st March
1994.
The total pension cost for the company was 187,000 British pounds
sterling. This represents contributions payable to Graseby plc, who
are responsible for making contributions to the pension funds on
behalf of the group as a whole.
13
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
16. LEASE COMMITMENTS
The Company has annual commitments under non-cancelable leases
having expiry periods as follows:
1 October 1997
Land and
Buildings Other
(In thousands of British pounds sterling)
Within one year 40 77
Between one & five years 210 276
After five years 347 6
--- ---
597 359
=== ===
17. CONTINGENT LIABILITIES
a) The Company has a contingent liability, under a composite cross
guarantee structure with other companies in the group, in respect
of banking facilities. At the year end there were no such
liabilities.
b) The Company is registered with H.M. Customs and Excise as a member
of a group for VAT purposes, resulting in a joint and several
liability on a continuing basis for amounts owing by the remainder
of the group for unpaid VAT.
There are no other known claims at the balance sheet date not provided
for in these financial statements.
18. COMMITMENTS FOR CAPITAL EXPENDITURE
1 October 1997
(In thousands of British pounds sterling)
Capital expenditure authorized and
contracted for but not provided 34
Capital expenditure authorized for
which contracts have not been placed -
--
34
==
19. RELATED PARTY TRANSACTIONS
There were no transactions during the period with related parties
as defined in financial reporting standard number 8 ("FRS8") other
than with fellow group companies. As the Company is owned as to more
than 90% by the ultimate holding company it is exempt under FRS8 from
the obligation to disclose transactions with fellow group companies.
20. ULTIMATE HOLDING COMPANY
At the balance sheet date the Company's ultimate holding company
was Graseby plc, incorporated in England and Wales. On 2nd October an
offer by Smiths Industries plc for all the issued share capital of
Graseby plc was declared unconditional with acceptances in excess of
90%. Accordingly, Smith Industries plc, which is also incorporated in
England and Wales was the ultimate holding company until 12 June 1998,
at which point Thermo Sentron Inc. purchased the Company.
14
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
21. DIVIDENDS PAID
Per Share Amount
9 Months to 9 Months to
1 October 1997 1 October 1997
(In thousands of British pounds sterling)
Dividend on ordinary
equity shares:-
Interim - -
----------- -----------
Final - -
----------- -----------
- -
----------- -----------
Dividend on non-equity
redeemable shares:-
Interim - -
----------- -----------
Final - -
----------- -----------
- -
----------- -----------
Total - -
----------- -----------
22. INVESTMENTS
Other Investments
(In thousands of British pounds sterling)
Valuation 3
At 31 December 1996 -
Additions -
Disposals -
--
At 1 October 1997 3
==
The Group has a 33% interest in Svenska Allen AB (Sweden).
Svenska Allen AB acts as a distributor for the Allen Coding
operations. The Board does not exercise significant influence over
this investment and it is valued at a cost of 3,000 British pounds
sterling.
23. MOVEMENT ON RESERVES
1 October 1997
(In thousands of British pounds sterling)
Profit and loss account
At 31 December 1996 4,429
Loss for the period (279)
Currency translation differences on foreign
currency net investments 137
-------
At 1 October 1997 4,287
=======
24. CASH FLOW DISCLOSURES
a) Reconciliation of Operating Profit to Net Cash Inflow
Cash Flow from Operating Activities:
Operating Profit 11
Depreciation Charges 396
Increase in Stocks (178)
Decrease in Debtors 231
Decrease in Creditors (329)
-----
Net Cash Inflow from Operating Activities 131
=====
15
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
b)Reconciliation of Net Cash Flow Movement to Movement in Net
Funds
Reconciliation of Net Cash Flow to Movement
in Net Funds:
Decrease in Cash in the Period (492)
Cash Inflow from Increase in Short-term Borrowings (1,090)
Exchange Differences 89
------
Movement in net funds in the period (1,493)
Net funds at 31 December 1996 2,269
------
Net funds at 1 October 1997 776
======
c) Analysis of Net Funds
At 31 Dec. Cash Exch. At 1 Oct.
1996 Flow Move. 1997
(In thousands of British pounds sterling)
Cash in Hand, at Bank 2,798 (492) 89 2,395
Overdrafts (529) (1,090) 0 (1,619)
---------------------------------------
Total 2,269 (1,582) 89 776
=======================================
25. Reconciliation of Movement in Shareholders' Funds
(In thousands of British pounds sterling)
Equity shareholders' funds:
Loss for the financial period (279)
Other recognized gains and losses 137
-----
Net addition to shareholders' funds (142)
Opening shareholders' funds 9,475
-----
Closing shareholders' funds 9,333
=====
Non-equity shareholders' funds:
At 31 December 1996 and
At 1 October 1997 1,520
=====
Non-equity shareholders' funds represent redeemable ordinary
shares in Goring Kerr Detection Limited and Graseby Product Monitoring
Limited.
26. COMPANIES ACT 1985
The combined financial statements do not constitute "statutory
accounts" within the meaning of the United Kingdom Companies Act 1985
for any of the periods presented. These combined financial statements
exclude certain parent company statements and other information
required by the Companies Act 1985. However, they include all material
disclosures required by generally accepted accounting principles in
the United Kingdom including those Companies Act 1985 disclosures
relating to the profit and loss account and balance sheet items. NOTES
TO THE COMBINED ACCOUNTS (continued)
16
<PAGE>
27. SUMMARY OF DIFFERENCES BETWEEN UNITED KINGDOM AND UNITED STATES
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES
(1)Differences giving rise to accounting adjustments
The Company's accounts are prepared in accordance with generally
accepted accounting principles ("GAAP") applicable in the United
Kingdom, which differ in certain significant respects from those
applicable in the United States. The main differences relate
principally to the following items, and the effects of the adjustments
on operating profits, net income and shareholders' funds, and on
certain balance sheet items are set out below.
a.Goodwill
Under U.K. GAAP, the Company writes off acquisition goodwill
directly against reserves in its combined balance sheet in the year of
acquisition. Under U.S. GAAP, goodwill is recognized in the balance
sheet and amortized by charges against income over its useful life,
not to exceed forty years. The Company considered various factors in
determining its amortization period, including competitive, legal,
regulatory, and other factors. As required by APB No. 17, the Company
limited its amortization period to the specified maximum life of forty
years.
For U.S. GAAP purposes, goodwill has been accounted for at the
lower of amortized cost or fair value. Fair value has been determined
by reference to a non-discounted cash flow analysis over the remaining
amortization period. Any goodwill amount not expected to be
recoverable as a result of this review would be accounted for as an
impairment of value. No such impairment of value has occurred.
b.Taxes on income
Under U.K. GAAP, deferred tax is provided using the liability
method at the rates ruling at each year end. Timing differences are
recognized to the extent that the directors consider such differences
will reverse in the foreseeable future. Net debit balances resulting
from tax losses or other timing differences are not recognized except
to the extent that it is assured beyond reasonable doubt that future
taxable profits will be sufficient to offset the losses or reversal of
timing differences during the prescribed carry forward period. Any
amounts not so recognized are subsequently only recognized as they are
realized. This policy was substantially in accordance with U.S. GAAP
prior to the introduction of SFAS No. 109, "Accounting for Income
Taxes." Under SFAS No. 109, deferred tax liabilities related to timing
differences are fully provided and future taxation benefits are
recognized as deferred tax assets to the extent that their realization
is more likely than not.
17
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
c.Hedging of anticipated intercompany foreign currency commitment
Under U.K. GAAP, hedges of anticipated intercompany foreign
currency commitments are deferred to the extent that the forward
contracts are in a gain position. As a result of EITF 95-2, under U.S.
GAAP, either a third party commitment or a real economic loss imposed
by a third party must exist for intercompany foreign currency
commitments to be firm. Such intercompany foreign currency commitments
must be considered firm to justify deferral of gains or losses on
foreign exchange contracts as required by FAS 52. As a result, the
Company's foreign exchange forward contracts to buy U.S. dollars and
sell U.K. pounds sterling have been marked to market for U.S. GAAP
purposes with the resulting gains and losses included in the
determination of net income. Such contracts have not been marked to
market for U.K. GAAP purposes.
d.Combined Balance Sheet presentation
The Combined Balance Sheet prepared in accordance with U.K. GAAP
differs in certain respects from U.S. GAAP. For example, under U.K.
GAAP current assets are presented after fixed assets; current assets
include amounts which fall due after more than one year (see Note 9)
and creditors falling due after one year are deducted from current
assets to present net current assets (liabilities).
e.Combined Statement of Cash Flows
The Company's combined statement of cash flows is prepared in
accordance with Financial Reporting Standard No. 1 (Revised 1996),
"Cash Flow Statements," and presents substantially the same
information as that required under Statement of Financial Accounting
Standards No. 95. However, there are certain differences in
classification of items within the statement of cash flows and with
regard to the definition of cash equivalents between U.K. and U.S.
GAAP.
Cash flows from (i) operating activities; (ii) returns on
investments and servicing of finance; (iii) taxation; (iv) capital
expenditure and financial investment; (v) management of liquid
resources; and (vi) financing activities are presented separately
under U.K. GAAP. However, U.S. GAAP only requires presentation of cash
flows from three activities: operating, investing and financing.
Cash and cash equivalents under U.K. GAAP may include cash in
hand and deposits repayable on demand less any bank loans and
overdrafts repayable on demand. Under U.S. GAAP overdrafts are
included in financing activities.
Cash flows from taxation and returns on investments and servicing
of finance are, with the exception of dividends paid and interest paid
but capitalized, included as operating activities under U.S. GAAP. The
payment of dividends is included under financing activities and
capitalized interest is included under investing activities for U.S.
GAAP purposes.
18
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
The following table summarizes the statement of cash flows for
the Group as if they had been presented in accordance with U.S. GAAP
9 months ended
1 October 1997
(In thousands of British pounds sterling)
Net cash outflow from operating activities (564)
Net cash used in investing activities (474)
Net cash provided by financing activities 546
Exchange rate effect on cash 89
----
Net decrease in cash and cash equivalents (403)
====
f.Effect on net income and shareholders' funds of differences between
U.K. GAAP and U.S. GAAP.
The following is a summary of the approximate effects on operating profit,
net income, shareholders' equity and on certain other balance sheet items
if U.S. GAAP were to be applied instead of U.K. GAAP.
9 months ended
1 October 1997
(In thousands of British pounds sterling)
Operating Profit:
Operating profit under U.K. GAAP 11
Amortization of goodwill (1) (323)
Foreign exchange forward contracts(2) (125)
----
Operating loss under U.S. GAAP (437)
====
Net Income:
Loss on ordinary activities ("net loss") under
U.K. GAAP (279)
Adjustments:
Amortization of goodwill(1) (323)
Foreign exchange forward contracts(2) (75)
Deferred taxation(3) 117
----
Net loss under U.S. GAAP (560)
====
19
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
The following is a summary of the approximate effect on shareholders' funds of
differences between U.K. GAAP and U.S. GAAP.
1 October 1997
(In thousands of British pounds sterling)
Shareholders' Funds:
Capital and reserves under U.K. GAAP 10,853
Adjustments:
Goodwill(1) 15,025
Foreign exchange forward contracts(2) 1
Deferred taxation(3) 526
------
Approximate shareholders' equity under U.S. GAAP 26,405
======
Total Assets:
Under U.K. GAAP 16,730
Adjustments:
Goodwill(1) 15,025
Foreign exchange forward contracts(2) 1
Deferred taxation(3) 526
------
Under U.S. GAAP 32,282
======
Total Liabilities:
Under U.K. and U.S. GAAP 5,877
======
Notes
(1)The goodwill adjustment relates to the acquisition of Product Monitoring
GmbH, Best Limited, Hascal Limited, InterTest Limited and Goring Kerr Limited
during the period 1991 to 1994. The goodwill of 17.2 million British pounds
sterling is being amortized under U.S. GAAP on a straight-line basis over 40
years and is 17.2 million British pounds sterling as of 1 October 1997, net of
accumulated amortization of 2.2 million British pounds sterling.
(2)The foreign exchange forward contracts adjustment recognizes the impact of
marking to market the foreign exchange forward contracts as required under U.S.
GAAP for the Company's contracts to buy U.S. dollars and sell U.K. pounds
sterling.
(3)The deferred taxation adjustment recognizes the deferred tax asset
under U.S. GAAP which is not recognized under U.K. GAAP.
(ii)Additional U.S. GAAP Disclosures
a.Disclosures about fair values of financial instruments
SFAS No. 107 requires the disclosure of estimated fair values for all financial
instruments for which it is practicable to estimate that value.
20
<PAGE>
NOTES TO THE COMBINED ACCOUNTS (continued)
With regard to cash, short term debt, non-trade receivables and payables, and
lease obligations the terms of these financial instruments approximate those
available in the current market. Accordingly carrying values approximate fair
value.
It has not been practical to estimate the fair value of the 3.5 million British
pounds sterling group loan recoverable from the immediate parent company as
there is no market interest rate readily available to utilize in such an
estimate.
b.Concentration of credit risk
The Company does not have any significant concentrations of credit risk.
21
<PAGE>
UNAUDITED INTERIM PROFIT AND LOSS ACCOUNTS
Unaudited
Six Months Ended March 31
1997 1998
(In thousands of British pounds sterling)
(Predecessor) (Successor)
TURNOVER 13,890 13,741
Cost of Sales 7,887 8,360
------ ------
Gross Profit 6,003 5,381
Other Operating Income 34 -
Operating Expenses 5,003 4,802
------ ------
OPERATING PROFIT 1,034 579
Net interest 58 65
------ ------
PROFIT ON ORDINARY ACTIVITIES BEFORE
TAXATION 1,092 644
Tax on Profit on Ordinary Activities (542) (337)
------ ------
Profit on Ordinary Activities After
Taxation 550 307
Dividend Paid 761 -
------ ------
RETAINED (LOSS)/PROFIT (211) 307
====== ======
See accompanying notes.
22
<PAGE>
UNAUDITED INTERIM BALANCE SHEET
Unaudited
31 March 1998
(In thousands of British pounds sterling)
FIXED ASSETS
Tangible assets 927
Investments 3
CURRENT ASSETS
Stocks 4,208
Debtors - amounts falling due within one year 6,103
- amounts falling due after more than one year 4,525
Cash at bank and in hand 3,546
-------
18,382
Creditors - amounts falling due within one year (7,812)
-------
NET CURRENT ASSETS 10,570
-------
TOTAL ASSETS LESS CURRENT LIABILITIES 11,500
=======
CAPITAL & RESERVES
Combined share capital 1,471
Share premium account 3,575
Profit and loss account 4,934
-------
EQUITY SHAREHOLDERS FUNDS 9,980
Non-equity shareholders funds 1,520
-------
TOTAL SHAREHOLDERS FUNDS 11,500
=======
See accompanying notes.
23
<PAGE>
UNAUDITED INTERIM STATEMENTS OF CASH FLOWS
Unaudited
Six Months Ended March 31
1997 1998
(In British pounds sterling)
(Predecessor) (Successor)
Cash Flow from Operating Activities:
Operating Profit 1,034 579
Depreciation Charges 288 315
Decrease in Stocks 412 603
Increase in Debtors (708) (1,168)
(Decrease)/Increase in Creditors (376) 1,952
------ ------
Net Cash Inflow from Operating Activities 650 2,281
Returns on Investments and Servicing of
Finance:
Interest Received 58 65
------ ------
Net Cash Inflow for Returns on Investments 58 65
Capital Expenditure and Financial Investment:
Purchase of Tangible Fixed Assets (260) (140)
------ ------
Net Cash Outflow for Capital Expenditure and
Financial Investment (260) (140)
Dividends Paid (761) -
Financing:
Decrease in Short-term Borrowings (926) -
Increase/(Decrease) in Long-term Receivable 1,267 (1,010)
------ ------
Net Cash Outflow from Financing 341 (1,010)
Effect of Exchange Rate (38) (45)
------ ------
Increase/(Decrease) in Cash in the Period (10) 1,151
Reconciliation of Net Cash Flow to Movement
in Net Funds:
Increase/(Decrease) in Cash in the Period (10) 1,151
Net Funds at Beginning of Period 2,573 4,014
------ ------
Net Funds at End of Period 2,563 5,165
====== ======
See accompanying notes.
24
<PAGE>
NOTES TO THE UNAUDITED INTERIM FINANCIAL STATEMENTS
1. Interim Results
The interim financial statements presented have been prepared by the Product
Monitoring Group of Graseby plc without audit and, in the opinion of management,
reflect all adjustments of a normal recurring nature necessary for a fair
statement of the financial position at March 31, 1998 and the results of
operations and cash flows for the six months ended March 31, 1997 and 1998.
Interim results are not necessarily indicative of results for a full year.
2.Reconciling Items Between U.S. and U.K. Generally Accepted Accounting
Principles
a)Interim Profit and Loss Accounts
Unaudited
Six Months Ended 31 March
1997 1998
(In thousands of British pounds sterling)
Profit on ordinary activities after
taxation under U.K. GAAP 550 307
Amortization of goodwill (216) (295)
Foreign exchange forward contracts (75) -
Deferred taxation 25 25
---- ----
Net income under U.S. GAAP 284 37
==== ====
See Note 27 of the audited accounts for explanation of reconciling
items.
b)Interim Balance Sheet
Unaudited
31 March 1998
(In thousands of British pounds sterling)
Shareholders Funds:
Capital and reserves under U.K. GAAP 11,500
Adjustments:
Goodwill 23,319
Deferred taxation 551
------
Shareholders' equity under U.S. GAAP 35,370
======
Total Assets:
Under U.K. GAAP 19,312
Adjustment:
Goodwill 23,319
Deferred taxation 551
------
Under U.S. GAAP 43,182
======
See Note 27 of the audited accounts for explanation of reconciling
items.
25
<PAGE>
NOTES TO THE UNAUDITED INTERIM FINANCIAL STATEMENTS (continued)
c)Interim Cash Flows
Six Months Ended 31 March
1997 1998
(In thousands of British pounds sterling)
Net cash provided by operating
activities 670 2,301
Net cash used in investing activities (260) (140)
Net cash used in financing activities (420) (1,010)
Exchange rate effect on cash 38 45
------ ------
Net increase in cash and cash
equivalents 28 1,196
====== ======
26
Item 7. Financial Statements, Pro Forma Combined Condensed Financial
Information and Exhibits
(b) Pro Forma Combined Condensed Financial Information:
The following unaudited pro forma combined condensed financial
statements set forth the results of operations for the fiscal year
ended January 3, 1998, and the six months ended July 4, 1998, as if the
acquisition of the three businesses that constitute the Graseby
product-monitoring group of Graseby Limited (Graseby Product
Monitoring) by the Company had occurred at the beginning of 1997.
Graseby Product Monitoring was acquired by Smiths Industries plc on
October 1, 1997. Accordingly, the pro forma combined condensed
statement of operations for the year ended January 3, 1998, includes
the results of Graseby Product Monitoring for the nine months ended
October 1, 1997 (the Predecessor) prior to its acquisition by Smiths
plc and the three months ended January 3, 1998, subsequent to its
acquisition by Smiths plc (the Successor). The primary difference in
the basis of accounting between the Predecessor and the Successor
relates to goodwill which has been adjusted in the pro forma combined
condensed results of operations to reflect the goodwill arising as a
result of the Company's acquisition of Graseby Product Monitoring.
The acquisition has been accounted for using the purchase method of
accounting. The pro forma results of operations are not necessarily
indicative of future operations or the actual results that would have
occurred had the acquisition of Graseby Product Monitoring been
consummated at the beginning of 1997. The historical financial
statements of Graseby Product Monitoring, originally prepared in
accordance with U.K. generally accepted accounting principles and
stated in British pounds sterling, have been translated into U.S.
dollars and presented in a manner consistent with the financial
statements of the Company, as described in Note 1 to these pro forma
combined condensed statement of operations. In addition, the
accompanying pro forma adjustments include those necessary to conform
such financial statements to U.S. generally accepted accounting
principles. The financial statements filed under part (a) of this item
should be read in conjunction with these pro forma combined condensed
financial statements.
4
<PAGE>
<TABLE>
<CAPTION>
FORM 8-K/A
THERMO SENTRON INC.
PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
Year Ended January 3, 1998
(Unaudited)
Historical Pro Forma
----------------------------------------------------------------- ------------------
Graseby Product Monitoring
-------------------------------------------
<CAPTION>
U.S. GAAP
Thermo Predecessor Successor Total Adjust- Adjust-
Sentron U.K. GAAP U.K. GAAP U.K. GAAP ments U.S. GAAP ments Combined
-------- -------- -------- -------- -------- -------- -------- --------
(In thousands except per share amounts)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues $ 78,695 $ 33,642 $ 12,177 $ 45,819 $ - $ 45,819 $ - $124,514
-------- -------- -------- -------- -------- -------- -------- --------
Costs and Operating
Expenses:
Cost of revenues 47,564 20,042 8,020 28,062 - 28,062 325 75,951
Selling, general,
and administrative
expenses 20,533 11,574 3,941 15,515 782 16,297 297 37,127
Research and
development
expenses 1,888 1,887 513 2,400 - 2,400 - 4,288
-------- -------- -------- -------- -------- -------- -------- --------
69,985 33,503 12,474 45,977 782 46,759 622 117,366
-------- -------- -------- -------- -------- -------- -------- --------
Operating Income (Loss) 8,710 139 (297) (158) (782) (940 (622) 7,148
Interest and Other Income
(Expense), Net 1,926 (8) (54) (62) (191) (253) (2,586) (913)
-------- -------- -------- -------- -------- -------- -------- --------
Income (Loss) Before
Income Taxes 10,636 131 (351) (220) (973) (1,193) (3,208) 6,235
Income Tax Provision
(Benefit) 4,148 581 (14) 567 (192) 375 (1,210) 3,313
-------- -------- -------- -------- -------- -------- -------- --------
Net Income (Loss) $ 6,488 $ (450) $ (337) $ (787) $ (781) $ (1,568) $ (1,998) $ 2,922
======== ======== ======== ======== ======== ======== ======== ========
Basic and Diluted
Earnings per Share $ .66 $ .30
======== ========
Weighted Average Shares:
Basic 9,875 9,875
======== ========
Diluted 9,878 9,878
======== ========
See notes to pro forma combined condensed financial information.
</TABLE>
5
<PAGE>
<TABLE>
FORM 8-K/A
THERMO SENTRON INC.
PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
Six Months Ended July 4, 1998
(Unaudited)
Historical Pro Forma
------------------------------------------- -------------------
Graseby Product Monitoring
----------------------------
<CAPTION>
U.S. GAAP
Thermo U.K. Adjust- Adjust-
Sentron GAAP ments U.S. GAAP ments Combined
-------- -------- -------- -------- -------- --------
(In thousands except per share amounts)
<S> <C> <C> <C> <C> <C> <C>
Revenues $ 40,558 $ 19,178 $ - $ 19,178 $ - $ 59,736
-------- -------- -------- -------- -------- --------
Costs and Operating Expenses:
Cost of revenues 24,598 10,605 - 10,605 (156) 35,047
Selling, general, and
administrative expenses 10,666 6,374 442 6,816 69 17,551
Research and development
expenses 1,006 805 - 805 - 1,811
-------- -------- -------- -------- -------- --------
36,270 17,784 442 18,226 (87) 54,409
-------- -------- -------- -------- -------- --------
Operating Income (Loss) 4,288 1,394 (442) 952 87 5,327
Interest and Other Income
(Expense), Net 805 442 - 442 (1,099) 148
-------- -------- -------- -------- -------- --------
Income (Loss) Before Income
Taxes 5,093 1,836 (442) 1,394 (1,012) 5,475
Income Tax Provision (Benefit) 1,968 654 (41) 613 (405) 2,176
-------- -------- -------- -------- -------- --------
Net Income (Loss) $ 3,125 $ 1,182 $ (401) $ 781 $ (607) $ 3,299
======== ======== ======== ======== ======== ========
Basic and Diluted Earnings
per Share $ .32 $ .34
======== ========
Weighted Average Shares:
Basic 9,776 9,776
======== ========
Diluted 9,779 9,779
======== ========
</TABLE>
See notes to pro forma combined condensed financial information.
6
<PAGE>
FORM 8-K/A
THERMO SENTRON INC.
NOTES TO PRO FORMA COMBINED CONDENSED FINANCIAL INFORMATION
(Unaudited)
Note 1 - Basis of Presentation
The results of operations of Graseby Product Monitoring have been presented
in the pro forma combined condensed statement of operations in accordance with
U.K. generally accepted accounting principles (GAAP) adjusted to conform to U.S.
GAAP. The historical financial statements of Graseby Product Monitoring are
denominated in British pound sterling, and have been translated at the average
exchange rate of 1.620 U.S. dollars per British pound sterling for the pro forma
combined condensed statement of operations for the nine months ended October 1,
1997 (Predecessor), 1.660 U.S. dollars per British pounds sterling for the three
months ended January 3, 1998 (Successor), and 1.654 U.S. dollars per British
pound sterling for the six months ended July 4, 1998. The allocation of the
purchase price is based on an estimate of the fair market value of the net
assets acquired and is subject to adjustment. To date, no information has been
gathered that would cause the Company to believe that the final allocation of
the purchase price will be materially different than the preliminary estimate.
Note 2 - Pro Forma Adjustments to Pro Forma Combined Condensed
Statement of Operations (In thousands, except in text)
Year Ended Six Months
January 3, Ended
1998 July 4, 1998
---------- ------------
Debit (Credit)
Adjustments to Convert U.K. GAAP to U.S. GAAP
- ---------------------------------------------
Selling, General, and Administrative Expenses
Record amortization of cost in excess of net
assets of acquired companies over 40 years,
recorded to shareholders' investment under
U.K. GAAP $ 782 $ 442
------- -------
Interest and Other Income (Expense), Net
Record mark-to-market adjustment for
foreign currency contract that is not
recorded as a hedge under U.S. GAAP 191 -
------- -------
Income Tax Provision
Record deferred tax provision not recorded
under U.K. GAAP (192) (41)
------- -------
Pro Forma Adjustments
- ---------------------
Cost of Revenues
Increase in the work-in-process and finished
goods inventories of Graseby Product
Monitoring to the estimated selling price,
less the sum of the costs of disposal and
a reasonable profit allowance for the
Company's selling efforts 325 (156)
------- -------
7
<PAGE>
Note 2 - Pro Forma Adjustments to Pro Forma Combined Condensed
Statement of Operations (In thousands, except in text)
(continued)
Year Ended Six Months
January 3, Ended
1998 July 4, 1998
---------- ------------
Debit (Credit)
Selling, General, and Administrative Expenses
Eliminate corporate services fee charged to
Graseby Product Monitoring by Smiths plc $ (343) $ (84)
Service fee of 1.0% and 0.8% of the revenues
of Graseby Product Monitoring for the fiscal
year ended January 3, 1998, and the six-month
period ended July 4, 1998, respectively, for
services provided under a services agreement
between the Company and Thermo Electron 458 153
Amortization over 40 years of $38,574,000 of
cost in excess of net assets of acquired
companies created by the acquisition of
Graseby Product Monitoring, net of
amortization of cost in excess of net assets
of acquired companies recorded in Graseby
Product Monitoring's historical results of
operations, as adjusted to conform to U.S.
GAAP 182 -
------- -------
297 69
------- -------
Interest and Other Income (Expense), Net
Decrease in interest income as a result of
the use of cash of $23.2 million to partially
finance the acquisition of Graseby Product
Monitoring, calculated using the 90-day
Commercial Paper Composite Rate plus 25
basis points, or 5.85% for the year ended
January 3, 1998, and 5.71% for the six
months ended July 4, 1998 1,357 577
Increase in interest expense as a result of a
borrowing from Thermo Electron of $21.0
million to partially finance the acquisition
of Graseby Product Monitoring, calculated
using the 90-day Commercial Paper Composite
Rate plus 25 basis points, or 5.85% for the
year ended January 3, 1998, and 5.71% for
the six months ended July 4, 1998 1,229 522
------- -------
2,586 1,099
------- -------
8
<PAGE>
Note 2 - Pro Forma Adjustments to Pro Forma Combined Condensed
Statement of Operations (In thousands, except in text)
(continued)
Year Ended Six Months
January 3, Ended
1998 July 4, 1998
---------- ------------
Debit (Credit)
Income Tax Provision (Benefit)
Income tax benefit associated with the
adjustments above (excluding the
amortization of cost in excess of net
assets of acquired companies), calculated
at the Company's statutory rate of 40% $ (1,210) $ (405)
------- -------
9
<PAGE>
Item 7. Financial Statements, Pro Forma Combined Condensed Financial
Information and Exhibits
(c) Exhibits
2.1* Agreement dated March 13, 1998, for the sale and purchase of all
of the issued share capitals of Graseby Allen Limited, Graseby
Product Monitoring Limited, Goring Kerr Detection Limited,
Graseby Goring Kerr Inc., Graseby Andersen Inc. and part of the
share capital of Allen France S.A., between Graseby Limited,
Thermo Environmental Instruments Inc., Thermo Sentron Inc.,
Smiths Industries plc, and Thermo Electron Corporation
(previously filed as Exhibit 2.1 to the Registrant's Current
Report on Form 8-K filed June 24, 1998). Pursuant to Item
601(b)(2) of regulation S-K, schedules and exhibits to this
Agreement have been omitted. The Company hereby undertakes to
furnish supplementally a copy of such schedules and exhibits to
the Commission upon request.
2.2 Amendment Agreement dated May 7, 1998, between Graseby Limited,
Thermo Environmental Instruments Inc., Thermo Sentron Inc.,
Smiths Industries plc, and Thermo Electron Corporation
(previously filed as Exhibit 2.2 to the Registrant's Current
Report on Form 8-K filed June 24, 1998).
2.3 Agreement, dated June 9, 1998, to further amend the sale and
purchase agreement dated March 13, 1998 between Graseby Limited,
Thermo Environmental Instruments Inc., Thermo Sentron Inc.,
Smiths Industries plc, and Thermo Electron Corporation
(previously filed as Exhibit 2.3 to the Registrant's Current
Report on Form 8-K filed June 24, 1998). Pursuant to Item
601(b)(2) of regulation S-K, schedules and exhibits to this
Amendment Agreement have been omitted. The Company hereby
undertakes to furnish supplementally a copy of such schedules and
exhibits to the Commission upon request.
10 $21.0 Million Promissory Note due December 15, 1998, payable to
Thermo Electron Corporation (previously filed as Exhibit 10 to
the Registrant's Current Report on Form 8-K filed June 24, 1998).
* Confidential treatment requested as to certain portions of the document,
which portions have been omitted and filed separately with the Securities and
Exchange Commission.
10
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized, on this 26th day of August, 1998.
THERMO SENTRON INC.
By: Paul F. Kelleher
---------------------------------
Paul F. Kelleher
Chief Accounting Officer
11
<PAGE>
