SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 333-24001
Packard BioScience Company
(Exact name of registrant as specified in its charter)
Delaware 06-0676652
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
800 Research Parkway, Meriden, Connecticut 06450
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 203-238-2351
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 and Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. YES [ ] NO [X]
Shares Outstanding at June 30, 1997
9,007,264
<PAGE>
PACKARD BIOSCIENCE COMPANY AND SUBSIDIARIES
INDEX
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets as of June 30, 1997 and December
31, 1996
Condensed Consolidated Statements of Income (Loss) for the Three and
Six Months Ended June 30, 1997 and 1996
Condensed Consolidated Statements of Cash Flow for the Six Months
Ended June 30, 1997 and 1996
Notes to Condensed Consolidated Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
<PAGE>
PART I. FINANCIAL INFORMATION
PACKARD BIOSCIENCE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF JUNE 30, 1997 and DECEMBER 31, 1996
(Dollars in Thousands)
June 30, December 31,
1997 1996
ASSETS (Unaudited)
CURRENT ASSETS :
Cash and cash equivalents $ 23,468 $ 37,826
Accounts receivable, net 32,246 40,860
Inventories 24,533 21,798
Other current assets 6,506 6,432
Total current assets 86,753 106,916
PROPERTY, PLANT AND EQUIPMENT, at cost 32,503 31,185
Less - Accumulated depreciation (15,469) (13,598)
17,034 17,587
OTHER ASSETS :
Deferred financing costs, net 10,664 0
Deferred income taxes 7,207 1,238
Investments 5,404 1,818
Goodwill, net 4,789 147
Other 10,917 10,219
38,981 13,422
TOTAL ASSETS $142,768 $137,925
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
CURRENT LIABILITIES :
Notes payable $ 2,045 $ 3,524
Current portion of long-term obligations 1,985 829
Accounts payable 8,972 11,118
Accrued liabilities 18,474 15,943
Other current liabilities 17,089 16,286
Total current liabilities 48,565 47,700
LONG-TERM OBLIGATONS, net of current portion:
Notes and other long-term obligations 5,700 6,912
Term loan facility 39,600 0
Senior subordinated notes 150,000 0
Total long-term obligations, net 195,300 6,912
COMMITMENTS AND CONTINGENCIES
MINORITY INTEREST IN EQUITY OF SUBSIDIARY 0 2,720
STOCKHOLDERS' EQUITY (DEFICIENCY):
Common stock 137 129
Paid-in capital 0 1,320
Cumulative translation adjustment 823 2,402
Retained earnings 364 89,088
Unrealized investment gains, net 2,151 0
3,475 92,939
Less: Treasury stock, at cost 103,435 11,128
Deferred compensation 1,137 1,218
Total stockholders' equity
(deficiency) (101,097) 80,593
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIENCY) $142,768 $ 137,925
======== =========
The accompanying notes are an integral part of these condensed consolidated
financial statements.
<PAGE>
PACKARD BIOSCIENCE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 1997 AND 1996
(Unaudited)
(Dollars in Thousands, except per share amounts)
<TABLE>
<CAPTION>
For the Three Months Ended For the Six Months Ended
June 30, June 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
NET SALES $ 45,142 $ 44,931 $ 87,702 $ 91,033
COST OF SALES 21,383 21,711 40,869 41,977
GROSS PROFIT 23,759 23,220 46,833 49,056
RESEARCH AND
DEVELOPMENT EXPENSES 5,322 3,686 10,373 8,211
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 11,568 12,072 22,742 23,481
RECAPITALIZATION CHARGES 0 170 17,979 170
OPERATING PROFIT (LOSS) 6,869 7,292 (4,261) 17,194
INTEREST EXPENSE ( 4,812) (38) (6,422) (66)
INTEREST INCOME 187 349 505 566
INCOME (LOSS) BEFORE INCOME
TAXES AND MINORITY INTEREST 2,244 7,603 (10,178) 17,694
PROVISION FOR (BENEFIT FROM)
INCOME TAXES 927 1,387 ( 2,207) 5,634
MINORITY INTEREST IN INCOME
OF SUBSIDIARY 0 368 218 1,024
NET INCOME (LOSS) $ 1,317 $ 5,848 $ (8,189) $ 11,036
========== ========= ========== ========
Weighted average common shares
outstanding including common
share equivalents (in thousands) 8,968 24,606 15,912 24,719
Earnings (loss) per share $ .15 $ .24 $ (.51) $ .45
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
<PAGE>
PACKARD BIOSCIENCE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND 1996
(Unaudited)
(Dollars in Thousands)
<TABLE>
<CAPTION>
For the Six Months Ended
June 30,
1997 1996
<S> <C> <C> <C> <C>
CASH FLOWS FROM (USED FOR) OPERATING
ACTIVITIES:
Net income (loss) $ (8,189) $ 11,036
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities:
Depreciation and amortization of intangibles 3,039 2,348
Amortization of deferred financing costs 515 0
Other non-cash charges, net 3,733 1,201
Changes in operating assets and liabilities 3,058 2,947
Net cash provided by operating activities: 2,156 17,532
CASH FLOWS FROM (USED FOR) INVESTING
ACTIVITIES:
Purchase of minority interest in subsidiary (7,551) 0
Capital expenditures (1,674) (1,377)
Investments 0 (2,013)
Product lines, patent rights and licenses acquired (1,256) (1,846)
Net cash used for investing activities (10,481) (5,236)
CASH FLOWS FROM (USED FOR) FINANCING
ACTIVITIES:
Borrowings under long-term obligations 194,710 1,135
Repayments of long-term obligations (4,272) ( 624)
Purchase of treasury stock (208,847) (4,097)
Sale of treasury stock 21,050 0
Proceeds from exercise of stock options 8,330 129
Recapitalization costs deferred or charged to equity (15,295) 0
Dividend paid 0 (4,972)
Net cash used for financing activities ( 4,324) (8,429)
EFFECT OF EXCHANGE RATE CHANGES ON CASH ( 1,709) (1,117)
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS ( 14,358) 2,750
CASH AND CASH EQUIVALENTS, beginning of period 37,826 22,515
CASH AND CASH EQUIVALENTS, end of period $ 23,468 $ 25,265
======== =========
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
<PAGE>
PACKARD BIOSCIENCE COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
AS OF JUNE 30, 1997 AND 1996
The condensed consolidated financial statements and related notes included
herein have been prepared by Packard BioScience Company (the Company) without
audit, except for the December 31, 1996 condensed consolidated balance sheet
which was derived from the Company's registration statement on Form S-4, filed
with the Securities and Exchange Commission on June 5, 1997 (the Registration
Statement), under the Securities Act of 1933. The Registration Statement was
prepared pursuant to the rules and regulations of the Securities and Exchange
Commission and contains audited consolidated financial statements of the
Company for the years ending December 31, 1994, 1995 and 1996. The Company
suggests that the condensed consolidated financial statements be read in
conjunction with the consolidated financial statements and related notes to the
consolidated financial statements contained in the Registration Statement.
Certain information and footnote disclosures which normally accompany financial
statements prepared in accordance with generally accepted accounting principles
have been omitted from the accompanying condensed consolidated financial
statements, as permitted by the Securities and Exchange Commission's rules and
regulations. The Company believes that the accompanying disclosures and notes
are adequate to make the financial statements not misleading. Such financial
statements reflect all adjustments which are normal and recurring and, in the
opinion of management, necessary for a fair presentation of the results of
operations and financial position of the Company for the periods reported
herein.
Note 1. Basis of Presentation and Significant Accounting Policies:
The accompanying financial statements have been prepared in accordance with the
accounting policies described in Note 1 to the consolidated financial statements
included in the Registration Statement. The Company's practices of recognizing
assets, liabilities, revenues, expenses and other transactions which impact the
accompanying financial information is consistent with such note.
In connection with a collaborative research and development alliance, the
Company has an equity investment in a company that designs and develops
proprietary drug discovery systems, services and technologies to accelerate and
enhance the discovery of new medicines. The Company has classified this
investment as available for sale securities in accordance with Financial
Accounting Standards Board (FASB) Statement of Financial Accounting Standard No.
115, "Accounting for Certain Investments in Debt and Equity Securities". As
such, the investment is reflected in the accompanying financial statements at
its market value as of June 30, 1997 and the unrealized gain, net of taxes, as
of that date is reflected in a separate component of stockholders' equity titled
"Unrealized investment gains, net".
Note 2. New Accounting Standards:
In April 1997, the FASB issued Statement of Financial Accounting Standard No.
128, "Earnings Per Share" (SFAS No. 128). SFAS No. 128 changes the manner in
which earnings per share amounts are calculated and presented. The most
significant change that this standard introduces is the required presentation
of "basic" earnings per share which is based solely on the weighted average
number of common shares outstanding during the period reported, excluding the
dilutive impact of any potential common stock equivalents such as stock
options. SFAS No. 128, which will be effective for the Company beginning with
the annual period ending December 31, 1997, will result in the Company's
presentation of basic as well as diluted earnings per share. All historical
earnings per share information will be restated to conform to the provisions of
SFAS No. 128. SFAS No. 128 will have no impact on the Company's results of
operations or financial position.
In addition to SFAS No. 128, the FASB has issued several other new accounting
standards which became effective after January 1, 1996 (refer to Note 1 to the
consolidated financial statements included in the Registration Statement). The
impact of adopting these standards was not material to the consolidated
financial position or results of operations of the Company.
Note 3. Inventories:
Inventories consisted of the following at June 30, 1997 and December 31, 1996
(in thousands):
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
<S> <C> <C>
Raw materials and parts $ 12,496 $ 13,532
Work in process 908 944
Finished goods 13,136 9,085
26,540 23,561
Excess and obsolete reserve (2,007) (1,763)
$ 24,533 $ 21,798
========== ==========
</TABLE>
Note 4. Recapitalization:
Refer to Notes 4 and 12 to the 1996 consolidated financial statements and Notes
3 and 4 to the condensed consolidated financial statements included in the
Registration Statement for a detailed description of the recapitalization of
the Company which occurred in March 1997 (the Recapitalization).
Note 5. Minority Interest Acquisition:
In May 1997, a subsidiary of the Company, Packard Japan KK ("PJKK"), entered
into an agreement, denominated in Japanese yen, to acquire the 40% interest
held by its minority stockholder for approximately $7.5 million. The agreement
obligates PJKK to acquire approximately 60% of the minority interest in 1997
and the remainder in future years as PJKK generates sufficient earnings to
allow the transaction to occur in accordance with Japanese laws and
regulations. Under the agreement, the minority stockholder has surrendered the
rights to any dividends from PJKK subsequent to December 31, 1996. The Company
has reflected the acquisition in full as of the effective date of the agreement
which was April 1, 1997 and, as a result, the minority interest has been
eliminated and the related obligations as well as resulting goodwil have been
recorded as of such date.
Note 6. Stock Dividend:
On May 15, 1997, the Board of Directors declared a 1-for-1 stock dividend on
shares outstanding on that date. The dividend was paid from shares held in
treasury by the Company. The impact of the issuance of the treasury shares was
charged against paid-in capital to the extent available with the remainder
charged to retained earnings. All per share and number of shares information,
except for treasury stock, included in the accompanying financial statements
has been restated to reflect the stock dividend.
Note 7. Stock Option Plans:
In connection with the Recapitalization, the Company redeemed all stock options
of noncontinuing stockholders and acquired a portion of the then outstanding
options held by management. Subsequent to the Recapitalization, all remaining
outstanding options, amounting to 600,000 (adjusted to reflect the 1-for-1
stock dividend discussed above), became fully vested. Such options will expire
at various dates through the year 2006.
Effective March 4, 1997, the Company adopted the Management Stock Incentive
Plan. Under this nonqualified plan, the Company is authorized to issue
incentive and performance options to certain employees and directors. The
plan allows for the issuance of up to 952,840 incentive options and up to
278,052 performance options with exercise prices of $11.125 and $13.625,
respectively. The options vest over a four year period commencing from the
date of grant and expire within ten years from grant. Management authorized
the granting of 657,500 incentive options and 265,000 performance options,
generally effective as of the closing of the Recapitalization.
Note 8. Stockholder's Equity (Deficiency):
During the six months ending June 30, 1997, changes in selected stockholders'
equity (deficiency) accounts and related share information consisted of the
following (dollar amounts in thousands):
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Common Stock Treasury Stock Paid -in Retained
Shares Amount Shares Amount Capital Earnings
Balance, December 31, 1996 12,924,221 $ 129 777,869 $ (11,128) $1,320 $ 89,088
Restricted stock plan shares
forfeited (898) (6)
Shares issued in connection
with the exercise of stock
options 798,500 8 17,758
Purchase of treasury stock 9,386,432 (208,847)
Sale of treasury stock (1,103,413) 24,452 (3,403)
Fees related to Recapitalization (3,252) (864)
Stock dividend (4,346,329) 95,340 (18,208) (77,132)
Net loss (8,189)
Balance, June 30, 1997 13,721,823 $ 137 4,714,559 $(103,435) $ 0 $ 364
</TABLE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 1997 AND 1996
This report contains statements which, to the extent they are not recitations
of historical facts, constitute "forward-looking" statements and are
prospective. All such forward-looking statements are intended to be subject to
the safe harbor protection of the Securities Litigation Reform Act of 1995. A
number of important factors affecting the Company's business and financial
results could cause actual results to differ materially from those stated in
the forward-looking statements. Those factors include developments in
technology, changes in legislative, political and regulatory conditions, and
the overall competitive environment in addition to such other factors disclosed
in the Registration Statement and in the Company's other securities filings.
General
The Company is a leading developer, manufacturer and marketer of analytical
instruments and related products and services for use in the drug discovery and
molecular biology segments of the life sciences industry and in the nuclear
instrumentation industry. Through Packard Instrument Company, Inc., a wholly-
owned subsidiary, and several other wholly-owned subsidiaries (collectively,
"Packard Instrument"), the Company supplies bioanalytical instruments, and
related biochemical supplies and services, to the drug discovery and molecular
biology markets, and through certain divisions and wholly-owned subsidiaries
comprising the Canberra Nuclear Products Group ("Canberra Nuclear"), the
Company manufactures analytical instruments used to detect, identify and
quantify radioactive materials for the nuclear industry and related markets.
Results of Operations (dollars in millions)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
%Inc. %Inc.
1997 1996 (Dec.) 1997 1996 (Dec.)
<S> <C> <C> <C> <C> <C> <C>
Total revenues:
Packard Instrument $31.4 $30.7 2.2 % $60.8 $62.8 (3.2)%
Canberra Nuclear 13.7 14.2 (3.6) 26.9 28.2 (4.7)
Consolidated 45.1 44.9 0.4 87.7 91.0 (3.7)
Gross profit:
Packard Instrument 17.2 16.6 3.6 33.6 35.6 (5.7)
Canberra Nuclear 6.6 6.6 - 13.2 13.5 (2.3)
Consolidated 23.8 23.2 2.5 46.8 49.1 (4.7)
Operating expenses:
Research and development 5.3 3.7 43.2 10.4 8.2 26.8
Selling, general and administrative 11.6 12.0 (3.4) 22.7 23.5 (3.5)
Recapitalization charges - .2 N/A 18.0 .2 N/A
Operating profit (loss) $ 6.9 $ 7.3 (5.5) $(4.3) $17.2 N/A
</TABLE>
Excluding the impact of changes in foreign currency exchange rates,
consolidated total revenues would have been $1.8 million and $3.7 million
higher for the three and six months ended June 30, 1997, respectively. Packard
Instrument's total revenues increased slightly during the three month period
ended June 30, 1997 and decreased approximately $2 million during the six month
period then ended as compared to the comparable periods in 1996. Sales at the
Company's Japanese subsidiary, Packard Japan KK ("PJKK"), experienced declines,
which were expected, during both of the 1997 periods. These decreases, which
amounted to $3.75 million and $7.6 million for the three and six month periods
presented, are primarily a result of the Japanese government's efforts during
1996 to stimulate the Japanese economy through increased spending in areas
including the Company's products and services. During 1997, the Japanese
government's spending level in these areas has decreased dramatically. The
decreases in Japanese sales volume were offset by increases in sales of several
new products including the Homogeneous Time-Resolved Flourescence (HTRF)
<trademark> instrument, Cyclone<trademark>, MicroCount<trademark>, Top
Count<trademark> and Kryptor<trademark> as well as increased chemical and
supply sales. Canberra Nuclear's decreased sales, both second quarter and
year-to-date 1997, is due primarily to declining sales volume at the majority
of its European operations combined with the unfavorable exchange impact of the
strengthening U.S. dollar in 1997 as compared to 1996.
The Company's gross profit decrease during the six months ended June 30, 1997,
as compared to the corresponding 1996 period, is due to the lower sales
discussed above (particularly from the Company's Japanese operation) and a
stronger U.S. dollar. Gross profit increased during the three months ended
June 30, 1997, as compared with the same period in 1996, primarily due to
margins generated on the increased Packard Instrument sales of new products
discussed above.
Research and development spending increased during both of the 1997 periods
presented, as compared to 1996, primarily reflecting increased investment on
the part of Packard Instrument in the areas of product enhancement and new
product development.
Selling, general and administrative expenses decreased from 1996 comparable
period levels and, as a percentage of total revenues, remained relatively
consistent with 1996 on a year-to-date basis. The decreases are attributable
primarily to the impact which the stronger U.S. dollar has on translating
foreign operating results.
During the first quarter of 1997, the Company recorded an $18.0 million charge
associated with the Recapitalization which was completed in March 1997. Refer
to the condensed consolidated financial statements and other information
contained in the Registration Statement for a detailed discussion and
description of the Recapitalization.
The consolidated operating profit (loss) of $6.9 million and $(4.3) million for
the three and six months ended June 30, 1997 compares with $7.3 million and
$17.2 million during the corresponding 1996 periods. In addition to the
Recapitalization charge, 1997 operating profit (loss) for the periods presented
reflects the negative impact of the lower Japanese operating results, increased
research and development spending and the stronger U.S. dollar as compared to
1996.
The increase in interest expense and decrease in interest income during the
1997 periods are a direct result of the funds used for the Recapitalization
(refer to the Registration Statement).
For the six months ended June 30, 1997, the consolidated effective tax rate was
a benefit of 21.7% compared to a 31.8% provision during the same period in
1996. The reduced rate was primarily a result of the tax benefit provided on a
portion of the Recapitalization charges being realized at a lower effective
rate than the rate on income generated in high tax rate countries, particularly
Japan.
Financial Condition - Liquidity and Capital Resources
The Company has historically generated sufficient cash flow from operations to
meet its working capital requirements as well as to fund capital expenditures,
debt service and equity transactions such as dividend payments and stock
repurchases. In connection with the Recapitalization, the Company increased
its long-term indebtedness by $190 million and, as a result, debt service
requirements have increased significantly as compared to historical levels.
The Company has, as of August 12, 1997, $75 million of funds available under a
revolving credit facility secured as part of the Recapitalization. Monies
available under this credit facility are subject to certain restrictions and
provisions contained therein. Refer to the Registration Statement for a
detailed description of the Recapitalization including the related indebtedness
and repayment terms and conditions. Prior to the time at which significant
levels of principal on the term loan and subordinated notes becomes due in
fiscal 2002, the Company will evaluate and identify the most advantageous
options available to service such debt. Options may include refinancing such
principal under potentially new terms and conditions or repaying such debt
through funds obtained through other sources or means. However, there can be
no assurance that any new financing will be available or that the terms thereof
will be favorable to the Company.
The Company expects to generate adequate cash from operations to meet most of
its working capital needs as well as to provide for necessary debt service
requirements during the next several years. If necessary, the Company can and
will borrow monies from the revolving credit facility in order to meet
temporary or seasonal shortfalls which may arise in the level of cash generated
from operations. The Company expects that, should the generation of excess
available operating cash flow be insufficient, it will utilize the revolving
credit facility to fund a significant portion of its strategic acquisition
program and new product development initiatives, as well as a portion of
capital expenditures for machinery, equipment and facility expansions.
Operating activities generated $2.2 million of cash during the six months ended
June 30, 1997 compared to $17.5 million of cash generated from operations in
the comparable 1996 period. The reduced operating cash flow is primarily a
result of the cash portion of the Recapitalization charge ($8.5 million)
recognized in the first quarter of 1997, the additional interest incurred on
the Recapitalization indebtedness and the lower operating results during the
six months ended June 30, 1997 as compared to the prior year period. The
Company has utilized a significant amount of cash (approximately $21.2 million)
to fund Recapitalization related fees and other related expenses.
In May 1997, PJKK entered into an agreement to acquire the 40% interest held
by its minority stockholder for approximately $7.5 million. (Refer to Note 5
to the condensed consolidated financial statements included herein). To date,
the acquisition has been funded through a combination of cash on hand and notes
payable issued to the minority stockholder. The Company expects that PJKK will
be able to complete the acquisition through a similar combination of sources.
In July 1997, the Company signed a letter of intent to acquire Aquila
Technologies Group, Inc. (Aquila). Aquila manufactures surveillance cameras,
electronic seals and other equipment utilized in the safeguarding of nuclear
materials. The Company expects to finance some portion of the proposed purchase
through borrowing on the revolving credit facility discussed above. The Company
will pay up to $7.7 million during calendar year 1997 with additional payments
contingent upon post-acquisition operating performance through 2000.
As of June 30, 1997, the Company's order backlog was approximately $23.5
million. The Company includes in backlog only those orders for which it has
received purchase orders and does not include in backlog orders for service.
The Company's backlog as of any particular date may not be representative of
actual sales for any succeeding period.
<PAGE>
PART II. OTHER INFORMATION
PACKARD BIOSCIENCE COMPANY
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
Exhibit No. Description
3.1 Amended and Restated Certificate of Incorporation of the
Company (incorporated by reference)
3.2 By-Laws of the Company (incorporated by reference)
10 Employment Agreement between Packard BioScience Company and
Ben D. Kaplan
27 Financial data schedule pursuant to Article 5 of Regulation
S-X
(b) Reports on Form 8-K
Not applicable.
<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, in the City of Meriden, State of
Connecticut, on August 12, 1997.
PACKARD BIOSCIENCE COMPANY
By: /s/ Emery G. Olcott
--------------------------------------
Emery G. Olcott
Chairman of the Board, Chief
Executive Officer and President
By: /s/ Ben D. Kaplan
--------------------------------------
Ben D. Kaplan
Vice President and Chief
Financial Officer
<PAGE>
EXHIBIT INDEX
Exhibit No. Description Page
10 Employment Agreement between Packard
BioScience Company and Ben D. Kaplan
27 Financial Data Schedule
EXHIBIT 10
EMPLOYMENT AGREEMENT
AGREEMENT by and between Packard BioScience Company (f/k/a
Canberra Industries, Inc.), a Delaware corporation with its principal office
and place of business in Meriden, Connecticut (the "Company"), and Ben D.
Kaplan (the "Executive"), dated as of the 4th day of March, 1997.
WHEREAS, the Board of Directors of the Company (the "Board") has
determined that it is in the best interests of the Company and its shareholders
to employ the Executive as Vice President and Chief Financial Officer of the
Company or in such capacity as may be reasonably assigned to him by the Chief
Executive Officer or the President of the Company;
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Employment Period. The Company shall employ the Executive,
and the Executive shall serve the Company, on the terms and conditions set
forth in this Agreement, for the period commencing on the date hereof and
ending on the third anniversary of the date hereof (the "Employment Period").
2. Position and Duties. (a) During the Employment Period, the
Executive's position (including status, offices, titles and reporting
requirements), authority, duties and responsibilities shall be those which are
reasonably assigned to him by the Chief Executive Officer or the President
of the Company.
(b) During the Employment Period, and excluding any
periods of vacation and sick leave to which the Executive is entitled, the
Executive shall devote reasonable attention and time during normal business
hours to the business and affairs of the Company and, to the extent necessary
to discharge the responsibilities assigned to the Executive under this
Agreement, use the Executive's reasonable best efforts to carry out such
responsibilities faithfully and efficiently. It shall not be considered a
violation of the foregoing for the Executive to serve on corporate, civic
or charitable boards or committees so long as such activities do not
significantly interfere with the performance of the Executive's
responsibilities as an employee of the Company in accordance with this
Agreement.
(c) The Executive's services shall be performed
primarily at the Company's headquarters in Meriden, Connecticut.
3. Compensation. (a) Base Salary. During the Employment
Period, the Executive shall receive an annual base salary ("Annual Base
Salary") at least equal to twelve times the monthly base salary paid or payable
to the Executive immediately prior to the date hereof. During the Employment
Period, the Annual Base Salary shall be reviewed for increase at least annually
and shall be increased pursuant to each such review by a percentage no less
than the percentage increase in the United States Consumer Price Index -- All
Urban Consumers, as published by the Bureau of Labor Statistics of the U.S.
Department of Labor, for the calendar year immediately preceding such
review. Any increase in the Annual Base Salary shall not limit or reduce any
other obligation of the Company under this Agreement. The Annual Base Salary
shall not be reduced after any such increase, and the term "Annual Base
Salary" shall thereafter refer to the Annual Base Salary as so increased.
(b) Annual Bonus. In addition to the Annual Base
Salary, the Executive shall be eligible to be awarded, for each fiscal year or
portion of a fiscal year ending during the Employment Period, an annual bonus
(the "Annual Bonus"), in accordance with the Company's annual incentive plans
then in effect. Each Annual Bonus shall be paid in a single cash lump sum no
later than 90 days after the end of the fiscal year or portion thereof for
which the Annual Bonus is awarded, unless the Executive elects in writing,
before the beginning of the fiscal year for which the Annual Bonus is to be
awarded, to defer receipt of the Annual Bonus.
(c) Other Benefits. During the Employment Period:
(i) the Executive shall be entitled to participate in all incentive, savings
and retirement plans, practices, policies and programs of the Company in
accordance with the plans, practices, programs and policies of the Company in
effect for the Executive as of the date hereof; and (ii) the Executive and/or
the Executive's family, as the case may be, shall be eligible for participation
in, and shall receive all benefits under, all welfare benefit plans, practices,
policies and programs provided by the Company (including, without limitation,
medical, prescription, dental, disability, salary continuance, employee life
insurance, group life insurance, accidental death and travel accident insurance
plans and programs, and key employee insurance) in accordance with the plans,
practices, programs and policies of the Company in effect for the Executive as
of the date hereof.
(d) Expenses. During the Employment Period, the
Executive shall be entitled to receive prompt reimbursement for all reasonable
expenses incurred by the Executive in carrying out the Executive's duties under
this Agreement, provided that the Executive complies with the policies,
practices and procedures of the Company for submission of expense reports,
receipts, or similar documentation of such expenses.
(e) Fringe Benefits. During the Employment Period, the
Executive shall be entitled to fringe benefits in accordance with the plans,
practices, programs and policies of the Company in effect for the Executive as
of the date hereof.
(f) Vacation. During the Employment Period, the
Executive shall be entitled to paid vacation annually in accordance with the
plans, policies, programs and practices of the Company as in effect for the
Executive as of the date hereof.
4. Termination of Employment. (a) Death or Disability. The
Executive's employment shall terminate automatically upon the Executive's death
during the Employment Period. The Company shall be entitled to terminate the
Executive's employment because of the Executive's Disability during the
Employment Period. "Disability" means that the Executive has been unable, for
a period of 180 consecutive business days, to perform the Executive's duties
under this Agreement, as a result of physical or mental illness or injury. A
termination of the Executive's employment by the Company for Disability shall
be communicated to the Executive by written notice, and shall be effective on
the 30th day after receipt of such notice by the Executive (the "Disability
Effective Date"), unless the Executive returns to full-time performance of the
Executive's duties before the Disability Effective Date.
(b) By the Company. (i) The Company may terminate the
Executive's employment during the Employment Period for Cause or without Cause.
"Cause" means: (i) the Executive's failure to perform the duties of his or her
employment in any material respect after notice from the Company and failure to
cure within ten business days after delivery of such notice, (ii) malfeasance
or gross negligence in the performance of Executive's duties of employment,
(iii) the Executive's commission of a felony under the laws of the United
States or any state thereof (whether or not in connection with his or her
employment), (iv) the Executive's disclosure of confidential information
respecting the Company's or any of its affiliated companies to any individual
or entity which is not in the performance of the duties of his or her
employment and which is harmful to the Company, or (v) any other act or
omission by the Executive (other than an act or omission resulting from the
exercise by the Executive of good faith business judgment) which is materially
injurious to the financial condition or the business reputation of the Company
or any of its divisions or affiliated companies. For purposes of this
Agreement, the term "affiliated companies" means all companies controlled by,
controlling or under common control with the Company.
(c) Good Reason. (i) The Executive may terminate employment
for Good Reason or without Good Reason. "Good Reason" means:
A. any action by the Company that results in a significant
diminution in the Executive's position or duties, other than an isolated and
inadvertent action that is not taken in bad faith and is remedied by the
Company promptly after receipt of written notice thereof from the Executive;
B. any material failure by the Company to comply with any provision
of Section 3 of this Agreement, other than an isolated and inadvertent failure
that is not taken in bad faith and is remedied by the Company promptly after
receipt of written notice thereof from the Executive;
C. any requirement by the Company that the Executive's services be
rendered primarily at a location or locations at a distance of more than 50
miles from the location provided for in paragraph (c) of Section 2 of this
Agreement without the Executive's consent;
D. any purported termination of the Executive's employment by the
Company for a reason or in a manner not permitted by this Agreement; or
E. any failure by the Company to comply with paragraph (c) of
Section 11 of this Agreement.
(ii) A termination of employment by the Executive for Good
Reason shall be effectuated by giving the Company written notice ("Notice of
Termination for Good Reason") of the termination, setting forth in reasonable
detail the specific conduct of the Company that constitutes Good Reason and the
specific provision(s) of this Agreement on which the Executive relies. A
termination of employment by the Executive for Good Reason shall be effective
on the fifth business day following the date when the Notice of Termination for
Good Reason is given, unless the notice sets forth a later date (which date
shall in no event be later than 30 days after the notice is given).
(iii) A termination of the Executive's employment by the
Executive without Good Reason shall be effected by giving the Company written
notice of the termination.
(d) No Waiver. The failure to set forth any fact or
circumstance in a Notice of Termination for Cause or a Notice of Termination
for Good Reason shall not constitute a waiver of the right to assert, and shall
not preclude the party giving notice from asserting, such fact or circumstance
in an attempt to enforce any right under or provision of this Agreement.
(e) Date of Termination. The "Date of Termination" means
the date of the Executive's death, the Disability Effective Date, the date on
which the termination of the Executive's employment by the Company for Cause or
by the Executive for Good Reason is effective, or the date on which the
Executive gives the Company notice of a termination of employment without
Good Reason, as the case may be.
5. Obligations of the Company upon Termination.
(a) Other Than for Cause, Death or Disability; Good Reason.
If, during the Employment Period, the Company terminates the Executive's
employment, other than for Cause, Death or Disability, or the Executive
terminates employment for Good Reason, the Company shall pay the amounts
described in subparagraph (i) below to the Executive in a lump sum in cash
within 30 days after the Date of Termination; shall continue the benefits
described in subparagraph (ii) below until at least the second anniversary of
the Date of Termination. The payments provided pursuant to this paragraph (a)
of Section 5 are intended as liquidated damages for a termination of
the Executive's employment by the Company other than for Cause, Death or
Disability or for the actions of the Company leading to a termination of the
Executive's employment by the Executive for Good Reason, and shall be the sole
and exclusive remedy therefor, but shall in no way affect the Executive's
rights under the agreements (if any) set forth on Schedule A, attached hereto.
(i) The amounts to be paid in a lump sum as described above
are:
A. The Executive's accrued but unpaid cash compensation
(the "Accrued Obligations"), which shall equal the sum of (1)
any portion of the Executive's Annual Base Salary through the
Date of Termination that has not yet been paid, (2) an amount
(the "Accrued Bonus Amount") equal to the product of (x) the
target Annual Bonus for the year of termination (the "An
nual Bonus Amount") and (y) a fraction, the numerator of which
is the number of days in the current fiscal year through the
Date of Termination, and the denominator of which is 365; (3)
any compensation previously deferred by the Executive (together
with any accrued interest or earnings thereon) that has not yet
been paid; and (4) any accrued but unpaid Annual Bonuses and
vacation pay;
B. Severance pay equal to the product of (x) the sum of
(1) the Annual Base Salary and (2) the Annual Bonus Amount and
(y) a fraction, the numerator of which is the number of days
remaining from the Date of Termination until the end of the
Employment Period, and the denominator of which is 365;
C. An amount equal to the aggregate amounts that
Company would have contributed on behalf of Executive under the
Thrift Savings Plan of Company, if said plan shall be in effect,
for two years after the Date of Termination (plus estimated
earnings thereon) as if Executive continued in the employ of
Company for such period and made contributions under said
plan at a rate, as a percentage of salary, equal to the average
rate at which Executive had made contributions to said plan in
the three (3) fiscal years of Company preceding the Date of
Termination;
D. To the extent that any form of compensation
previously granted to Executive, such as, by way of example
only, restricted stock, stock options or performance share
awards, shall not be fully vested or shall require additional
service as an employee at the time of the termination of
Executive's employment, Executive shall be credited with
additional service through the period ending two years after the
Date of Termination; and
E. For two years after the Date of Termination (but not
beyond the time when Executive becomes eligible for comparable
insurance coverage offered on comparable terms by any subsequent
employer), Executive shall also continue to participate in all
life, health, disability and similar insurance plans and
programs of Company to the extent that such continued
participation is possible under the general terms and provisions
of such plans and programs, with Company and Executive paying
the same portion of the cost of each such plan or program as
existed at the time of Executive's termination. In the event
that Executive's continued participation in any group plans and
programs is not permitted, then in lieu thereof, Company
shall acquire, with the same cost sharing, individual insurance
policies providing comparable coverage for Executive; provided
that Company shall not be obligated to pay for any such
individual coverage more than two times Company's cost of such
group coverage; and provided further, if any such individual
coverage is unavailable, then Company shall pay to Executive
annually for two years following the Date of Termination an
amount equal to the sum of the average annual contributions,
payments, credits, or allocations made by Company for such
insurance on Executive's behalf over the two (2) fiscal years of
Company preceding the Date of Termination, which amount shall be
pro rated for any fraction of a year.
(ii) The benefits to be continued as described above are
benefits to the Executive and/or the Executive's family at least as favorable
as those that would have been provided to them under clause (ii) of paragraph
(c) of Section 3 of this Agreement if the Executive's employment had continued
until the second anniversary of the Date of Termination; provided, however,
that during any period when the Executive is eligible to receive such benefits
under another employer-provided plan, the benefits provided by the Company
under this subparagraph may be made secondary to those provided under such
other plan. For purposes of determining eligibility (but not the time of
commencement of benefits) of the Executive for retiree benefits under this
subparagraph, the Executive shall be deemed to have continued employment with
the Company until the second anniversary of the Date of Termination.
(b) Cause; Other than for Good Reason, Death, Disability. If
the Executive's employment is terminated by the Company for Cause during the
Employment Period, the Company shall pay the Executive the Annual Base Salary
through the Date of Termination and the amount of any compensation previously
deferred by the Executive (together with any accrued interest or earnings
thereon), in each case to the extent not yet paid, and the Company shall have
no further obligations under this Agreement. If the Executive voluntarily
terminates employment during the Employment Period, other than for Good Rea
son, the Company shall pay the Accrued Obligations other than the Accrued Bonus
Amount to the Executive in a lump sum in cash within 30 days of the Date of
Termination, and the Company shall have no further obligations under this
Agreement.
If the Executive's employment is terminated by reason of the
Executive's death or Disability during the Employment Period, this Agreement
shall terminate without further obligations to the Executive's legal
representatives under this Agreement, other than for payment of the Accrued
Obligations.
6. Non-exclusivity of Rights. Nothing in this Agreement shall
prevent or limit the Executive's continuing or future participation in any
plan, program, policy or practice provided by the Company for which the
Executive may qualify, nor, subject to paragraph (f) of Section 12, shall
anything in this Agreement limit or otherwise affect such rights as the
Executive may have under any contract or agreement with the Company.
Vested benefits and other amounts that the Executive is otherwise entitled to
receive under any plan, policy, practice or program of, or any contract or
agreement with, the Company on or after the Date of Termination shall be
payable in accordance with such plan, policy, practice, program, contract or
agreement, as the case may be, except as explicitly modified by this Agreement.
7. Full Settlement. The Company's obligation to make the
payments provided for in, and otherwise to perform its obligations under, this
Agreement shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action that the Company may have against the
Executive or others. In no event shall the Executive be obligated to seek
other employment or take any other action by way of mitigation of the
amounts payable to the Executive under any of the provisions of this Agreement,
but if the Executive secures other employment, any fringe benefits (such as
medical insurance) the Company is required to provide to the Executive
following termination of the Executive's employment shall be secondary to those
provided by another employer (if any).
8. Confidential Information. (a) Executive understands that in
the course of his employment by Company, Executive will receive confidential
information concerning the business or purposes of Company, and which Company
desires to protect. Executive agrees that he will not at any time during or
after the Employment Period reveal to anyone outside Company or use for his own
benefit any such information that has been designated as confidential by
Company or reasonably should be understood by Executive to be confidential
without specific written authorization by Company. Executive further agrees
not to use any such confidential information or trade secrets in competing with
Company at any time during or after his employment by Company.
(b) All plans, discoveries and improvements, whether patentable
or unpatentable, made or devised by the Executive, whether alone or jointly
with others, from the date of the Executive's initial employment by the Company
and continuing until the end of the Employment Period and any subsequent period
when the Executive is employed by the Company or its affiliated companies,
relating or pertaining in any way to the Executive's employment with or the
business of the Company or any of its affiliated companies, shall be promptly
disclosed in writing to the Board of Directors of the Company and are hereby
transferred to and shall redound to the benefit of the Company, and shall
become and remain its sole and exclusive property. The Executive agrees to
execute any assignments to the Company or its nominee, of the Executive's
entire right, title and interest in and to any such discoveries and
improvements and to execute any other instruments and documents requisite
or desirable in applying for and obtaining patents or copyrights, at the
expense of the Company, with respect thereto in the United States and in all
foreign countries, that may be required by the Company. The Executive further
agrees, during and after the Employment Period, to cooperate to the extent and
in the manner required by the Company, in the prosecution or defense of any
patent or copyright claims or any litigation, or other proceeding involving any
trade secrets, processes, discoveries or improvements covered by this
Agreement, but all necessary expenses thereof shall be paid by the Company.
(c) The Executive acknowledges and agrees that: (i) the purpose
of the foregoing covenants is to protect the goodwill, trade secrets and other
Confidential Information of the Company; (ii) because of the nature of the
business in which Company are engaged and because of the nature of the
confidential information to which the Executive has access, it would be
impractical and excessively difficult to determine the actual damages
of Company and its affiliates in the event the Executive breached any of the
covenants of this Section 8; and (iii) remedies at law (such as monetary
damages) for any breach of the Executive's obligations under this Section 8
would be inadequate. The Executive therefore agrees and consents that if the
Executive commits any breach of a covenant under this Section 8 or threatens to
commit any such breach, the Company shall have the right (in addition to, and
not in lieu of, any other right or remedy that may be available to it) to
temporary and permanent injunctive relief from a court of competent
jurisdiction, without posting any bond or other security and without the
necessity of proof of actual damage. With respect to any provision of this
Agreement finally determined by a court of competent jurisdiction to be
unenforceable, the Executive and the Company hereby agree that such court shall
have jurisdiction to reform this Agreement or any provision hereof so that it
is enforceable to the maximum extent permitted by law, and the parties agree to
abide by such court's determination. If any of the covenants of this Agreement
are determined to be wholly or partially unenforceable in any jurisdiction,
such determination shall not be a bar to or in any way diminish the Company's
right to enforce any such covenant in any other jurisdiction.
9. Certain Additional Payments by the Company.
(a) Anything in this Agreement to the contrary notwithstanding
and except as set forth below, in the event it shall be determined that any
payment or distribution by the Company to or for the benefit of the Executive
(whether paid or payable or distributed or distributable pursuant to the terms
of this Agreement or otherwise, but determined without regard to any additional
payments required under this Section9) (a "Payment") would be subject to the
excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as
amended (the "Code") or any interest or penalties are incurred by the Executive
with respect to such excise tax (such excise tax, together with any such
interest and penalties, are hereinafter collectively referred to as the "Excise
Tax"), then the Executive shall be entitled to receive an additional payment (a
"Gross-Up Payment") in an amount such that after payment by the Executive of
all taxes (including any interest or penalties imposed with respect to
such taxes), including, without limitation, any income taxes (and any interest
and penalties imposed with respect thereto) and Excise Tax imposed upon the
Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal
to the Excise Tax imposed upon the Payments. Notwithstanding the foregoing
provisions of this Section 9(a), if it shall be determined that the Executive
is entitled to a Gross-Up Payment, but that the Executive, after taking into
account the Payments and the Gross-Up Payment, would not receive a net after-
tax benefit of at least $30,000 (taking into account both income taxes and
any Excise Tax) as compared to the net after-tax proceeds to the Executive
resulting from an elimination of the Gross-Up Payment and a reduction of the
Payments, in the aggregate, to an amount (the "Reduced Amount") such that the
receipt of Payments would not give rise to any Excise Tax, then no Gross-Up
Payment shall be made to the Executive and the Payments, in the aggregate,
shall be reduced to the Reduced Amount.
(b) Subject to the provisions of Section 9(c), all
determinations required to be made under this Section 9, including whether and
when a Gross-Up Payment is required and the amount of such Gross-Up Payment and
the assumptions to be utilized in arriving at such determination, shall be made
by Arthur Andersen LLP or such other certified public accounting firm as may be
designated by the Executive (the "Accounting Firm"), which shall provide
detailed supporting calculations both to the Company and the Executive within
15 business days of the receipt of notice from the Executive that there has
been a Payment, or such earlier time as is requested by the Company. All fees
and expenses of the Accounting Firm shall be borne solely by the Company. Any
Gross-Up Payment, as determined pursuant to this Section 9, shall be paid by
the Company to the Executive within five days of the receipt of the Accounting
Firm's determination. Any determination by the Accounting Firm shall be
binding upon the Company and the Executive. As a result of the uncertainty
in the application of Section 4999 of the Code at the time of the initial
determination by the Accounting Firm hereunder, it is possible that Gross-Up
Payments which will not have been made by the Company should have been made
("Underpayment"), consistent with the calculations required to be made
hereunder. In the event that the Company exhausts its remedies pursuant to
Section 9(c) and the Executive thereafter is required to make a payment
of any Excise Tax, the Accounting Firm shall determine the amount of the
Underpayment that has occurred and any such Underpayment shall be promptly paid
by the Company to or for the benefit of the Executive.
(c) The Executive shall notify the Company in writing of any
claim by the Internal Revenue Service that, if successful, would require the
payment by the Company of the Gross-Up Payment. Such notification shall be
given as soon as practicable but no later than ten business days after the
Executive is informed in writing of such claim and shall apprise the Company of
the nature of such claim and the date on which such claim is requested
to be paid. The Executive shall not pay such claim prior to the expiration of
the 30-day period following the date on which he gives such notice to the
Company (or such shorter period ending on the date that any payment of taxes
with respect to such claim is due). If the Company notifies the Executive in
writing prior to the expiration of such period that it desires to contest such
claim, the Executive shall:
(i) give the Company any information reasonably requested by the
Company relating to such claim,
(ii) take such action in connection with contesting such claim as
the Company shall reasonably request in writing from time to time,
including, without limitation, accepting legal representation with
respect to such claim by an attorney reasonably selected by the
Company,
(iii) cooperate with the Company in good faith in order effectively
to contest such claim, and
(iv) permit the Company to participate in any proceedings relating
to such claim; provided, however, that the Company shall bear and pay
directly all costs and expenses (including additional interest and
penalties) incurred in connection with such contest and shall indemnify
and hold the Executive harmless, on an after-tax basis, for any Excise
Tax or income tax (including interest and penalties with respect
thereto) imposed as a result of such representation and payment of
costs and expenses. Without limitation on the foregoing provisions of
this Section 9(c), the Company shall control all proceedings taken in
connection with such contest and, at its sole option, may pursue or
forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may,
at its sole option, either direct the Executive to pay the tax claimed
and sue for a refund or contest the claim in any permissible manner,
and the Executive agrees to prosecute such contest to a determination
before any administrative tribunal, in a court of initial jurisdiction
and in one or more appellate courts, as the Company shall determine;
provided, however, that if the Company directs the Executive to pay
such claim and sue for a refund, the Company shall advance the amount
of such payment to the Executive, on an interest-free basis and shall
indemnify and hold the Executive harmless, on an after-tax basis, from
any Excise Tax or income tax (including interest or penalties with
respect thereto) imposed with respect to such advance or with respect
to any imputed income with respect to such advance; and further
provided that any extension of the statute of limita tions relating to
payment of taxes for the taxable year of the Executive with respect to
which such contested amount is claimed to be due is limited solely to
such contested amount. Furthermore, the Company's control of the
contest shall be limited to issues with respect to which a Gross-Up
Payment would be payable hereunder and the Executive shall be entitled
to settle or contest, as the case may be, any other issue raised by the
Internal Revenue Service or any other taxing authority.
(d) If, after the receipt by the Executive of an amount
advanced by the Company pursuant to Section9(c), the Executive becomes
entitled to receive any refund with respect to such claim, the Executive shall
(subject to the Company's complying with the requirements of Section9(c))
promptly pay to the Company the amount of such refund (together with any
interest paid or credited thereon after taxes applicable thereto). If, after
the receipt by the Executive of an amount advanced by the Company pursuant to
Section 9 (c), a determination is made that the Executive shall not be entitled
to any refund with respect to such claim and the Company does not notify the
Executive in writing of its intent to contest such denial of refund prior to
the expiration of 30 days after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the amount of such advance
shall offset, to the extent thereof, the amount of Gross-Up Payment required to
be paid.
10. Arbitration. (a) Claims Subject to Arbitration.
Company and Executive mutually consent to the resolution by arbitration in
Hartford, Connecticut of all claims or controversies ("Claims"), whether or not
arising out of Executive's employment (or its termination), that Company may
have against Executive or that Executive may have against the Company or
against its officers, directors, shareholders, employees or agents in their
capacity as such. Any such arbitration shall be conducted in accordance with
the employment dispute resolution rules and procedures of the American
Arbitration Association. The claims covered by this Agreement include, but are
not limited to, claims for wages or other compensation due; claims for breach
of any contract or covenant (express or implied); tort claims; claims for
discrimination (including, but not limited to, race, sex, religion, national
origin, age, marital status, or medical condition, handicap or disability);
claims for benefits (except where an employee benefit or pension plan specifies
that its claims procedure shall culminate in an arbitration procedure different
from this one), and claims for violation of any federal, state, or other
governmental law, statute, regulation, or ordinance, except claims excluded in
the following Subparagraph.
(b) Claims Not Subject to Arbitration. Claims Executive may
have for workers' compensation or unemployment compensation benefits are not
covered under this Section 10. Also not covered are claims by the Company for
injunctive and/or other equitable relief for breach of the Executive's covenant
not to compete, for unfair competition or for the use or unauthorized
disclosure of trade secrets or confidential information, as to which Executive
understands and agrees that the Company may seek and obtain relief from
a court of competent jurisdiction, without any obligation on the part of the
Company to submit any related issue to arbitration before seeking such relief.
11. Successors. (a) This Agreement is personal to the
Executive and, without the prior written consent of the Company, shall not be
assignable by the Executive otherwise than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable
by the Executive's legal representatives.
(b) This Agreement shall inure to the benefit of and be binding
upon the Company and its successors and assigns.
(c) The Company shall require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company expressly to
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would have been required to perform it if no such
succession had taken place. As used in this Agreement, "Company" shall mean
both the Company as defined above and any such successor that assumes and
agrees to perform this Agreement, by operation of law or otherwise.
12. Miscellaneous. (a) This Agreement shall be governed by,
and construed in accordance with, the laws of the State of Connecticut, without
reference to principles of conflict of laws. The captions of this Agreement
are not part of the provisions hereof and shall have no force or effect. This
Agreement may not be amended or modified except by a written agreement executed
by the parties hereto or their respective successors and legal representatives.
Subject to the provisions of Section 10 of this Agreement, the
courts of record of the State of Connecticut or the Courts of the United States
located in the State of Connecticut shall have exclusive jurisdiction over any
suit, action or other proceeding arising out of this Agreement and, in the
event that it is brought, any such suit, action or other proceeding arising out
of this Agreement shall be filed in the Hartford Superior Court of the State of
Connecticut or the United States District Court in Hartford, Connecticut. The
parties hereto hereby irrevocably consent to the jurisdiction of each such
court in any such suit, action or proceeding.
(b) All notices and other communications under this Agreement
shall be in writing and shall be given by hand delivery to the other party or
by registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:
If to the Executive:
Ben D. Kaplan
33 Richard Sweet Drive
Woodbridge, Connecticut 06525
If to the Company:
Packard BioScience Company
800 Research Parkway
Meriden, Connecticut 06450
Attention: General Counsel
or to such other address as either party furnishes to the other in writing in
accordance with this paragraph (b) of Section 12. Notices and communications
shall be effective when actually received by the addressee.
(c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other
provision of this Agreement. If any provision of this Agreement shall be held
invalid or unenforceable in part, the remaining portion of such provision,
together with all other provisions of this Agreement, shall remain valid and
enforceable and continue in full force and effect to the fullest extent
consistent with law.
(d) Notwithstanding any other provision of this Agreement, the
Company may withhold from amounts payable under this Agreement all federal,
state, local and foreign taxes that are required to be withheld by applicable
laws or regulations.
(e) The Executive's or the Company's failure to insist upon
strict compliance with any provision of, or to assert any right under, this
Agreement (including, without limitation, the right of the Executive to
terminate employment for Good Reason pursuant to paragraph (c) of Section 4 of
this Agreement) shall not be deemed to be a waiver of such provision or right
or of any other provision of or right under this Agreement.
(f) The Executive and the Company acknowledge that this
Agreement supersedes any other agreement between them concerning the subject
matter hereof, except that the agreements (if any) set forth on Schedule A,
attached hereto, shall not be superseded.
(g) This Agreement may be executed in several counterparts,
each of which shall be deemed an original, and said counterparts shall
constitute but one and the same
instrument.
IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand
and, pursuant to the authorization of its Board of Directors, the Company has
caused this Agreement to be executed in its name on its behalf, all as of the
day and year first above written.
________________________________________
Ben D. Kaplan
________________________________________
PACKARD BIOSCIENCE COMPANY
By:_____________________________________
Its______________________________________
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<INTEREST-EXPENSE> 6,422
<INCOME-PRETAX> (10,718)
<INCOME-TAX> (2,207)
<INCOME-CONTINUING> (8,189)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (8,189)
<EPS-PRIMARY> (.51)
<EPS-DILUTED> (.51)
</TABLE>
