<PAGE>
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934.
For the Fiscal Year Ended December 31, 1997 Commission File Number 0-6866
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
HELIX TECHNOLOGY CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 04-2423640
(State of incorporation) (IRS Employer Identification No.)
Mansfield Corporate Center, Nine Hampshire Street,
Mansfield, Massachusetts 02048-9171
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (508) 337-5111
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Common Stock,
$1 Par Value
(Title of Class)
Indicate by checkmark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. YES [X] NO [ ]
Indicate by checkmark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best
of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ X ]
The aggregate market value of the registrant's common stock held by
nonaffiliates of the registrant as of February 20, 1998, (computed by reference
to the quoted selling prices of such stock in the over-the-counter market), was
$423,595,000.
The number of shares outstanding of the registrant's Common Stock, $1 Par Value,
as of February 20, 1998 was 19,830,206.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Annual Proxy Statement for the registrant's 1998 Annual Meeting
of Stockholders to be filed with the SEC in March 1998 are incorporated by
reference into Part III, Items 10-12.
<PAGE>
HELIX TECHNOLOGY CORPORATION 10-K Annual Report
Commission File No. 0-6866 For Fiscal Year Ended
December 31, 1997
PART I
Item 1. Business
General - HELIX TECHNOLOGY CORPORATION ("the Company"), a Delaware
corporation organized in 1967, is engaged in the development and application of
cryogenic and vacuum technology. The Company provides innovative solutions to
customer requirements in select markets worldwide.
Through its CTI-CRYOGENICS ("CTI") operations, the Company provides critical
vacuum components and subsystems used in a broad range of electronic component
manufacturing equipment. The principal customers for CTI's vacuum products are
involved in the production of semiconductors, optical and magnetic data storage
media and advanced information displays. The Cryo-Torr cryogenic vacuum pump
product line combines the expertise of CTI in both cryogenics and vacuum
technology. (Cryo-Torr is a registered trademark of Helix Technology
Corporation.) CTI's On-Board cryogenic vacuum pumping system incorporates
built-in microprocessor capabilities to provide on-line performance monitoring
and diagnostics. (On-Board is a registered trademark of Helix Technology
Corporation.)
The Company maintains Customer Support Centers strategically located throughout
the world to provide replacement parts, overhaul, repair and upgrade services.
The Company's unique GUTS rapid response system is designed to assure that users
of the Company's products have direct, twenty-four-hour a day access to the
resources of the Customer Support Centers. (GUTS is a registered trademark of
Helix Technology Corporation.)
The Company encounters competition in both domestic and foreign markets for its
products. Competition comes from smaller firms and from larger firms that have
greater total resources than the Company. The absence of statistics makes it
impossible to state the Company's precise position in its served markets,
although the Company believes it enjoys a leadership in the market for cryogenic
vacuum pumping systems. Customer service, product quality, performance and price
are all factors in selling the Company's products.
The Company's business is, generally, not dependent on the availability of raw
materials or components from any single source. Certain components, however, may
be available from only one or two qualified sources. The Company's policy is to
develop alternative sources for components and, where possible, to avoid using
scarce raw material in its products.
The Company holds many U.S. and foreign patents in the field of vacuum and
cryogenics that it believes are significant to its operations, which expire at
various times during the period ending 2015. No patents, which the Company
considers significant, expire during the next five years. Trademarks are
considered important to the Company's business. These trademarks are protected
by registration in the United States and other countries in which the Company's
products are marketed.
- 2 -
<PAGE>
PART I
Item 1. Business (continued)
The Company and Ulvac Corporation of Chigasaki, Japan, operate a joint venture,
Ulvac Cryogenics, Inc. ("UCI") formed in 1981, which manufactures and sells
cryogenic vacuum pumps, principally to Ulvac Corporation. Each company owns 50%
of UCI and made initial cash investments of approximately $100,000, with no
subsequent cash investments. The joint venture arrangement included a license
and technology agreement from the Company and a management and consultation
agreement from Ulvac Corporation. The Company and Ulvac Corporation essentially
share control of the joint venture.
Backlog - The backlog of orders believed to be firm was approximately
$5.9 million on December 31, 1997, compared to $5.3 million at December 31,
1996. The Company expects to recognize revenues from essentially all of the
December 31, 1997 backlog during the 1998 calendar year.
Research and Development - The Company expended $8,899,000 in 1997 on
research and development efforts compared to $7,668,000 and $4,534,000 in 1996
and 1995, respectively. These expenditures reflect development activities
relating to product enhancements and new products for commercial applications.
Employment - Total employment in the Company at the end of 1997 was 453
compared with 423 and 404 at the end of 1996 and 1995, respectively.
Environmental Affairs - Compliance with federal, state and local provisions
relating to environmental quality has not had, and is not expected to have, a
material impact upon capital expenditures, earnings or the competitive position
of the Company.
Financial Information about Industry Segments and Major Customers - The
Company's one industry segment is cryogenic and vacuum equipment. The Company's
largest customer represented 29%, 28% and 30% of sales for 1997, 1996 and 1995,
respectively. Information concerning operations in different geographic areas is
included in Note G of Notes to Consolidated Financial Statements included
elsewhere in this report.
Item 2. Properties
The Company leases and occupies two buildings in Mansfield, Massachusetts,
totaling approximately 218,000 square feet. The lease for its corporate
headquarters and manufacturing operations expires December 31, 2006. The lease
includes scheduled base rent increases through the term of the lease and renewal
options for up to fifteen additional years. The Company also leases space to
house remote customer support facilities. A facility of approximately 11,000
square feet is leased in Santa Clara, California, a facility of 12,000 square
feet is leased in Austin, Texas, and a facility of 1,300 square feet is leased
in Phoenix, Arizona. A total of approximately 16,000 square feet is leased in
Europe to house three customer support centers. The Company believes that its
facilities are adequate to support its current operations.
- 3 -
<PAGE>
PART I
Item 3. Legal Proceedings
In the normal course of business, the Company is subject to various legal
proceedings and claims. The Company believes that the ultimate outcome of these
matters will not have a material effect on its financial statements.
Item 4. Submission of Matters to a Vote of Security Holders
During the quarter ended December 31, 1997, no matters were submitted to a vote
of security holders through the solicitation of proxies or otherwise.
PART II
Item 5. Market for the Registrant's Common Stock and Related Security Holder
Matters
The Company's common stock is traded on the Over-The-Counter market (NASDAQ
symbol HELX). At December 31, 1997, there were 19,830,206 shares of common stock
outstanding and approximately 750 common stockholders of record.
Cash Dividend Per Common Share and Price Range of Common Stock
The cash dividend per common share and price range of the Company's common stock
by quarter are:
First Second Third Fourth
1997 Quarter Quarter Quarter Quarter
- --------------------------------------------------------------------------------
Stock price
High (1) $ 18.63 $ 21.00 $ 33.38 $ 31.53
Low (1) $ 14.13 $ 15.00 $ 19.50 $ 17.50
Cash dividend per share (1) $ .175 $ .175 $ .175 $ .210
First Second Third Fourth
1996 Quarter Quarter Quarter Quarter
- --------------------------------------------------------------------------------
Stock price
High (1) $ 20.63 $ 21.44 $ 19.63 $ 16.63
Low (1) $ 12.50 $ 13.63 $ 11.63 $ 12.63
Cash dividend per share (1) $ .125 $ .175 $ .175 $ .175
(1) Market prices and per share data reflect a two-for-one common stock split
effective November 1997. (Note E)
The Board of Directors declared a quarterly cash dividend of $0.21 per common
share payable on March 19, 1998, to common stockholders of record at the close
of business on March 5, 1998.
- 4 -
<PAGE>
PART II
<TABLE>
Item 6. Selected Financial Data
<CAPTION>
(in thousands except per share data) 1997 1996 1995 1994 1993
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net sales $131,519 $128,383 $123,667 $86,761 $63,863
Net income $ 21,315 $ 21,957 $ 20,985 $10,603 $ 5,021 (2)
Basic net income per share (1) $ 1.08 $ 1.12 $ 1.08 $ .55 $ .27 (2)
Diluted net income per share (1) $ 1.07 $ 1.10 $ 1.05 $ .54 $ .27 (2)
Cash dividends per share (1) $ .735 $ .65 $ .29 $ .145 $ .10
Total assets $ 81,666 $ 71,759 $ 69,074 $45,386 $32,662
Capitalized lease obligations $ - $ - $ - $ 36 $ 81
Basic shares (1) 19,768 19,670 19,478 19,146 18,944
Diluted shares (1) 19,970 19,978 20,010 19,698 19,124
(1) All share and per share data reflect a two-for-one common stock split
effective November 1997. (Note E) (2) Includes $108,000 ($0.01 per share)
cumulative tax benefit from adoption of SFAS No. 109 in 1993.
</TABLE>
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations - 1997 Compared With 1996
Net sales for 1997 increased to $131.5 million, an increase of $3.1 million or
2% compared with the prior year. The growth in sales resulted primarily from
record sales of the Company's cryogenic vacuum products and services used
principally by semiconductor manufacturers worldwide. Sales showed sequential
quarterly improvement during the first three quarters of 1997 as the global
market for semiconductor capital equipment strengthened. Sales decreased in the
fourth quarter due to uncertainty in the Asian market.
Total gross profit as a percentage of net sales was 47.4% in 1997 compared with
47.0% in 1996. The increase in gross profit was principally due to efficiencies
derived from the Company's flexible manufacturing strategies and ongoing cost
reduction initiatives.
Research and development expenses increased to $8.9 million or 6.8% of net sales
for fiscal 1997 as compared to $7.7 million or 6.0% of net sales for the prior
fiscal period. This increase reflects continued funding by the Company of
long-term strategic development programs in response to the increasing demand
for new products and product enhancements from the semiconductor industry.
- 5 -
<PAGE>
PART II
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations (continued)
Selling, general and administrative expenses increased to $24.2 million or 18.4%
of net sales for fiscal 1997 as compared to $20.9 million or 16.3% of net sales
for the prior fiscal year. This increase is primarily due to increases in
salaries and variable compensation expense, and to increased sales and
marketing efforts worldwide.
Interest income for 1997 was $1.5 million compared with $1.3 million for 1996,
reflecting higher cash and cash equivalent balances during the year.
Royalty and equity income from the Company's joint venture in Japan improved $.3
million over 1996.
The Company's provision for income taxes was $11.2 million and $12.5 million in
1997 and 1996, respectively. The difference between the statutory federal tax
rate and the Company's effective tax rate of 34.4% and 36.25% for 1997 and 1996,
respectively, is principally due to state and foreign income taxes. The lower
tax rate for 1997 is primarily due to increased tax credits for research and
development expenditures.
Liquidity and Capital Resources
Net cash provided by operating activities was $23.5 million in 1997. The Company
invested $4.5 million, primarily in machinery and equipment during 1997. As of
December 31, 1997, there are no anticipated material future capital
expenditures. Cash dividends paid to stockholders increased to $14.5 million
from $12.8 million for 1996.
At December 31, 1997, the Company had informal bank money market lines of credit
of $12 million. There have been no borrowings under these agreements since 1993.
Since the agreements are informal and unused, terms would be negotiated as
necessary. The Company does not anticipate utilizing these lines of credit in
the near term.
The Company manages its foreign exchange rate risk arising from intercompany
foreign currency denominated transactions through the use of foreign currency
forward contracts. The gains and losses on these transactions are not material.
The Company believes anticipated cash flow from operations and funds available
under existing credit lines will be adequate to fund operations through 1998 and
that it has opportunities to consider further financing options should
additional funds be required.
Results of Operations - 1996 Compared With 1995
Net sales for 1996 increased to $128.4 million, an increase of $4.7 million or
4% compared with prior year sales. The growth in sales resulted primarily from
record sales of the Company's cryogenic vacuum products and services used
principally by semiconductor manufacturers worldwide. Sales in the second half
of 1996 were sharply lower than in the first half as a result of the slowdown in
the global market for semiconductors and the equipment required to produce these
devices.
- 6 -
<PAGE>
PART II
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations (continued)
Total gross profit as a percentage of net sales improved 1.8 percentage points
during 1996 compared with 1995. The increase in gross margin was principally
due to efficiencies derived from the Company's manufacturing competencies. As a
result of the Company's flexible manufacturing strategy, gross margins remained
strong at the low revenue levels of the second half of 1996.
The Company's investment in research and development increased 69% in 1996
compared with 1995. Incorporation of our On-Board technology in a full range of
vacuum components will allow us to offer a broader range of products to our
current market. The Company has been developing unique vacuum solutions for
customers who are moving to larger wafer sizes and finer geometries in next
generation semiconductors. The Company continues to fund long-term strategic
development programs despite short-term market conditions.
The increase in Selling, general and administrative expenses was primarily
attributable to increases in selling costs and was somewhat offset by
performance-based management compensation expense.
Interest income for 1996 was $1.3 million compared with $.6 million for 1995,
reflecting significantly higher cash and cash equivalent balances during the
year.
Royalty and equity income from the Company's joint venture in Japan improved
$88,000 over 1995.
The Company's provision for income taxes was $12.5 million and $12.7 million in
1996 and 1995, respectively. The difference between the statutory federal tax
rate and the Company's effective tax rate of 36.25% and 37.75%, for 1996 and
1995, respectively, is principally due to state and foreign income taxes. The
change in the Company's effective tax rate between 1996 and 1995 is due to
increased tax credits for research and development combined with higher foreign
tax credits.
Year 2000
Certain of the Company's internal computer systems are not Year 2000 ready
(i.e., such systems use only two digits to represent the year in date data
fields and, consequently, may not accurately distinguish between the 20th and
21st centuries or may not function properly at the turn of the century). The
Company has been taking actions intended to either correct such systems or
replace them with Year 2000 ready systems. The Company expects to implement
successfully the systems and programming changes necessary to address Year 2000
issues and does not believe that the cost of such actions will have a material
effect on the Company's results of operations or financial condition.
- 7 -
<PAGE>
PART II
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations (continued)
New Accounting Pronouncements
In June 1997, the Financial Accounting Standards Board issued Financial
Accounting Standards No. 130, "Reporting Comprehensive Income" (SFAS 130). SFAS
130 establishes standards for the reporting and display of comprehensive income
and its components in a full set of general purpose financial statements.
Comprehensive income is defined as the change in equity of a business enterprise
during a period from transactions and other events and circumstances from
nonowner sources. The impact of adopting SFAS 130, which is effective for the
Company in 1998, has not been determined.
In June 1997, the Financial Accounting Standards Board issued Financial
Accounting Standards No. 131, "Disclosure about Segments of an Enterprise and
Related Information" (SFAS 131). SFAS 131 requires public companies to report
segment information on the basis used internally to measure segment performance
in complete financial statements and in condensed interim financials issued to
stockholders. This segment information includes their products and services, the
geographic areas in which they operate and their major customers. The impact of
adopting SFAS 131, which is effective for the Company in 1998, has not been
determined.
Business Risks and Uncertainties
The Company operates in a changing and cyclical business environment that
involves a number of risks, some of which are beyond the Company's control. The
Company's future results will depend on its continued ability to manage through
the cyclical nature of the semiconductor capital equipment industry, the
Company's ability to introduce new products to meet its customers' demands for
higher productivity and reliability, and the dependence of the Company on key
customers and key suppliers.
Forward-Looking Statements
This Annual Report, other SEC filings, and pronouncements and press releases
made from time to time by the Company through its senior management may include
a number of forward-looking statements, including, but not limited to,
statements with respect to the Company's future financial performance, operating
results, plans and objectives. Such statements are made pursuant to the Safe
Harbor provisions of the Private Securities Litigation Reform Act of 1995.
Actual results may differ materially from those anticipated by such statements
depending upon a variety of factors, some of which are itemized in the "Business
Risks and Uncertainties" section above. The Company undertakes no responsibility
to update any forward-looking statements that may be made to reflect events or
circumstances occurring after the dates the statements were made or to reflect
the occurrence of unanticipated events.
- 8 -
<PAGE>
PART II
Item 8. Financial Statements and Supplementary Data
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND
SCHEDULES COVERED BY THE REPORT OF
INDEPENDENT ACCOUNTANTS
Page(s)
Report of Independent Accountants..........................................17
Consolidated Financial Statements of Helix Technology Corporation
Consolidated Balance Sheets as of December 31, 1997 and 1996........18
Consolidated Statements of Operations for the Years Ended
December 31, 1997, 1996 and 1995................................19
Consolidated Statements of Stockholders' Equity
for the Years Ended December 31, 1997, 1996 and 1995............20
Consolidated Statements of Cash Flows for the Years
Ended December 31, 1997, 1996 and 1995..........................21
Notes to Consolidated Financial Statements.......................22-32
Report of Independent Accountants..........................................33
Quarterly Results (Unaudited)..............................................34
Financial Statement Schedules for the Years Ended December 31, 1997,
1996 and 1995
II. Valuation and Qualifying Accounts..........................35
Schedules other than those listed above have been omitted since they are either
inapplicable or not required.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
The Company did not change accountants or file a Form 8-K reporting a
disagreement on an accounting principle, practice or financial statement
disclosure during the twenty-four-month period ended December 31, 1997.
- 9 -
<PAGE>
PART III
Item 10. Directors and Executive Officers of The Registrant
Officers are elected annually by the Board and serve at the discretion of the
Board. Set forth below is information regarding the current Executive Officers
of the Company who are not Directors of the Company.
Mr. Robert Anastasi is 51 and has served the Company as Senior Vice President
since July 1997 and Vice President since June 1991.
Mr. Michael El-Hillow is 46 and has served the Company as Senior Vice President
and Chief Financial Officer since July 1997 and Vice President and Chief
Financial Officer since April 1997. He was Vice President and Chief Financial
Officer of A.T. Cross Company from January 1991 until April 1997.
Mr. Christopher Moody is 42 and has served the Company as Senior Vice President
since August 1997. He was Vice President of Japan Sales at KLA-Tencor
Corporation from April 1996 until August 1997 and Director of Sales for KLA
Instruments Wafer Inspection Division from January 1995 until April 1996. He
served as National Sales Manager at Eaton Corporation, Semiconductor Equipment
Division, from 1993 until January 1995.
Mr. Richard Paynting is 50 and has served the Company as Senior Vice
President since July 1997 and Vice President since August 1996. He was Director
of New Products at Bose Corporation from May 1991 until August 1996.
Additional information required by this item is incorporated herein by reference
to the registrant's proxy statement for its 1998 Annual Meeting of Stockholders
which will be filed with the SEC in March 1998, pursuant to Regulation 14A.
Item 11. Executive Compensation
Information required by this item is incorporated herein by reference to the
registrant's proxy statement for its 1998 Annual Meeting of Stockholders which
will be filed with the SEC in March 1998, pursuant to Regulation 14A.
Item 12. Security Ownership of Certain Beneficial Owners and Management
Information required by this item is incorporated herein by reference to the
registrant's proxy statement for its 1998 Annual Meeting of Stockholders which
will be filed with the SEC in March 1998, pursuant to Regulation 14A.
Item 13. Certain Relationships and Related Transactions
There were no related party transactions.
- 10 -
<PAGE>
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
Page Number(s) or
Incorporation by
Description Reference to
(a) Financial Statements, Schedules & Exhibits:
(1), (2) The Consolidated Financial Statements 9
and required schedules are indexed
under Item 8.
(3) Exhibits required by Item 601 of SEC
Regulation S-K. (Exhibit numbers refer to
exhibit number on Table I.)
3. Articles of Incorporation Exhibit 3 to the
Restated articles of incorporation Company's Form 10-Q
as amended on May 7, 1987, and for the Quarter Ended
May 18, 1988. September 30, 1988.
By-laws Exhibit (3)-3 to the
As amended on December 10, 1986, and Company's Form 10-K
December 9, 1987. for the Year Ended
December 31, 1987.
4A. Description of Common Stock Exhibit 3 to the
Company's Form
10-Q for the
Quarter Ended
September 30, 1988.
4B. Description of Preferred Stock Exhibit 3 to the
Company's Form
10-Q for the
Quarter Ended
September 30, 1988.
- 11 -
<PAGE>
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(continued)
Page Number(s) or
Incorporation by
Description Reference to
10. Material Contracts:
(1) Basic agreement between the Company Exhibit 10.13 to
and Ulvac Corporation dated a Registration
August 17, 1981. Statement on Form
S-2, Registration
No. 2-84880.
(2) Lease agreement dated July 24, 1984, Exhibit 10-(14)
between WRC Properties, Inc., as to the Company's
Lessor, and the Company as Lessee. Form 10-K for
the Year Ended
December 31, 1984.
(3) Lease Agreement dated May 23, 1991, Exhibit 10-(14) to the
between Mansfield Corporate Center Company's Form 10-K
Limited Partnership, as Lessor, and for the Year Ended
the Company as Lessee. December 31, 1991.
Compensation Plans, Contracts and
Arrangements:
(4) The Company's 1996 Equity Incentive Exhibit A to the
Plan. Company's Proxy
Statement for its
1996 Annual Meeting
of Stockholders held
on April 24, 1996.
(5) The Company's 1996 Stock Option Plan Exhibit B to the
for Non-Employee Directors. Company's Proxy
Statement for its
1996 Annual Meeting
of Stockholders held
on April 24, 1996.
- 12 -
<PAGE>
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(continued)
Page Number(s) or
Incorporation by
Description Reference to
(6) The Company's informal incentive Exhibit 10.9 to a
bonus plan. Registration
Statement on Form
S-2, Registration
No. 2-84880.
(7) Employment agreement dated Exhibit 9-(14) to the
December 13, 1989, as amended Company's Form 10-K
and restated on February 13, 1992, for the Year Ended
and re-executed on May 28, 1992, December 31, 1992.
between the Company and
Robert J. Lepofsky.
(8) The Company's Section 125 Plan. Exhibit 18 to Form 8,
Amendment No. 1 to
1985 Annual Report
on Form 10-K.
(9) The Company's Amended and Exhibit 10-(11) to the
Restated Employee Savings Plan Company's Form
dated December 15, 1994. 10-K for the Year
Ended December 31,
1994.
(10) The Company's Amended and Restated Exhibit 10-(12) to the
Employees' Pension Plan dated Company's Form
December 15, 1994. 10-K for the Year
Ended December 31,
1994.
(11) The Company's Amended and Restated Exhibit 10-(13) to the
Employee Personal Account Plan Company's Form
dated December 15, 1994. 10-K for the Year
Ended December 31,
1994.
- 13 -
<PAGE>
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(continued)
Page Number(s) or
Incorporation by
Description Reference to
(12) The Company's Supplemental Exhibit 14-(14) to the
Key Executive Retirement Plan Company's Form
effective February 13, 1992. 10-K for the Year
Ended December 31,
1992.
(13) Employment Agreement dated
July 18, 1997 between the Company
and Robert E. Anastasi.
(14) Employment Agreement dated
July 18, 1997 between the Company
and Michael El-Hillow.
(15) Employment Agreement dated
August 18, 1997 between the Company
and Christopher Moody.
(16) Employment Agreement dated
July 18, 1997 between the Company
and Richard J. Paynting.
11. Schedule of Computation of Income per
Share
21. Subsidiaries of the Registrant
23. Consent of Independent Accountants
27. Financial Data Schedule
(EDGAR version only)
(b) The Company did not file any reports on Form 8-K during the quarter ended
December 31, 1997.
(c) Exhibits required by Item 601 of Regulation S-K are indexed under
(a)(3) above.
(d) Separate financial statements of: (1) subsidiaries not consolidated and
fifty percent or less owned persons; (2) affiliates whose securities are
pledged as collateral; and (3) Schedules I, III, and IV are not filed
because they are either not applicable or the items do not exceed the
various disclosure levels.
- 14 -
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly
authorized, this 13th day of March, 1998.
HELIX TECHNOLOGY CORPORATION
(Registrant)
/s/ Robert J. Lepofsky
-----------------------------------------
Robert J. Lepofsky
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf
of the registrant on this 13th day of March, 1998, in the capacities
indicated.
Signatures Titles
(i) Principal Executive Officer
/s/ Robert J. Lepofsky
---------------------------
Robert J. Lepofsky President and Chief Executive Officer
(ii) Principal Financial and
Accounting Officer
/s/ Michael El-Hillow
---------------------------
Michael El-Hillow Senior Vice President,
Chief Financial Officer and
Chief Accounting Officer
- 15 -
<PAGE>
(iii) A Majority of the Board of Directors
/s/ Arthur R. Buckland Director
-------------------------
Arthur R. Buckland
/s/ Matthew O. Diggs, Jr. Director
-------------------------
Matthew O. Diggs, Jr.
/s/ Frank Gabron Director
-------------------------
Frank Gabron
/s/ Robert J. Lepofsky Director
-------------------------
Robert J. Lepofsky
/s/ Marvin G. Schorr Director and Chairman of the Board
-------------------------
Marvin G. Schorr
/s/ Wickham Skinner Director
-------------------------
Wickham Skinner
/s/ Mark S. Wrighton Director
-------------------------
Mark S. Wrighton
- 16 -
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To The Board Of Directors and Stockholders
of Helix Technology Corporation:
We have audited the accompanying consolidated balance sheets of Helix
Technology Corporation as of December 31, 1997 and 1996, and the related
consolidated statements of operations, stockholders' equity, and cash flows for
each of the three years in the period ended December 31, 1997. These financial
statements 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 audits in accordance with generally accepted auditing
standards. 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 financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Helix
Technology Corporation as of December 31, 1997 and 1996, and the consolidated
results of its operations and its cash flows for each of the three years in the
period ended December 31, 1997, in conformity with generally accepted accounting
principles.
/s/ Coopers & Lybrand L.L.P.
----------------------------
Coopers & Lybrand L.L.P.
Boston, Massachusetts
February 6, 1998
- 17 -
<PAGE>
<TABLE>
HELIX TECHNOLOGY CORPORATION
CONSOLIDATED BALANCE SHEETS
<CAPTION>
December 31,
(in thousands except share data) Notes 1997 1996
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Current:
Cash and cash equivalents (including repurchase
agreements of $24,500 in 1997 and $18,500
in 1996) A $ 33,360 $ 29,378
Receivables - net of allowances of $150 in
1997 and $148 in 1996 15,371 11,525
Inventories A 11,287 12,370
Deferred income taxes A&D 4,215 3,414
Other current assets 1,096 842
Total Current Assets 65,329 57,529
Property, plant and equipment at cost A 27,094 24,219
Less: accumulated depreciation (17,370) (15,837)
Net property, plant and equipment 9,724 8,382
Other assets A&F 6,613 5,848
TOTAL ASSETS $ 81,666 $ 71,759
LIABILITIES AND STOCKHOLDERS' EQUITY
Current:
Accounts payable $ 4,695 $ 4,780
Payroll and compensation E 3,691 3,438
Retirement costs H 2,960 2,212
Income taxes A&D 2,931 1,049
Other accrued liabilities 343 442
Total Current Liabilities 14,620 11,921
Commitments C - -
Stockholders' Equity:
Preferred stock, $1 par value; authorized
2,000,000 shares; issued and outstanding: none - -
Common stock, $1 par value; authorized 30,000,000
shares; issued and outstanding: 19,830,206 in 1997
and 19,725,180 in 1996 E 19,830 19,725
Capital in excess of par value 1,897 811
Currency translation adjustment A&F 71 833
Retained earnings E 45,248 38,469
Total Stockholders' Equity 67,046 59,838
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 81,666 $ 71,759
The accompanying notes are an integral part of these financial statements.
</TABLE>
- 18 -
<PAGE>
<TABLE>
HELIX TECHNOLOGY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
<CAPTION>
For the years ended December 31,
(in thousands except per share data) Notes 1997 1996 1995
- ------------------------------------------------------------------------------------------------------- ----------------
<S> <C> <C> <C> <C>
Net sales $131,519 $128,383 $123,667
Costs and expenses:
Cost of sales 69,210 68,081 67,740
Research and development A 8,899 7,668 4,534
Selling, general and administrative E 24,189 20,922 19,588
102,298 96,671 91,862
Operating income 29,221 31,712 31,805
Joint venture income F 1,744 1,480 1,392
Interest income 1,527 1,282 621
Other - (32) (104)
Income before taxes 32,492 34,442 33,714
Income taxes A&D (11,177) (12,485) (12,729)
Net income $ 21,315 $ 21,957 $ 20,985
Net income per share:
Basic A&E $ 1.08 $ 1.12 $ 1.08
Diluted A&E $ 1.07 $ 1.10 $ 1.05
Number of shares used in per share calculations:
Basic A&E 19,768 19,670 19,478
Diluted A&E 19,970 19,978 20,010
The accompanying notes are an integral part of these financial statements.
</TABLE>
- 19 -
<PAGE>
<TABLE>
HELIX TECHNOLOGY CORPORATION
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
<CAPTION>
Capital
Par in Excess Translation Retained
(in thousands except per share data) Value of Par Adjustment Earnings Total
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1994
as previously reported $ 9,668 $ 2,157 $1,043 $ 21,477 $ 34,345
Two-for-one stock split (Note E) 9,668 (2,157) - (7,511) -
As restated 19,336 - 1,043 13,966 34,345
Shares issued for stock options 370 2,523 - - 2,893
Income tax benefit from exercise of
stock options - 1,273 - - 1,273
Shares tendered for exercise of
stock options (152) (2,403) - - (2,555)
Currency translation adjustment - - 264 - 264
Net income - - - 20,985 20,985
Cash dividends ($.29 per share) - - - (5,652) (5,652)
Balance, December 31, 1995 19,554 1,393 1,307 29,299 51,553
Shares issued for stock options 419 1,417 - - 1,836
Income tax benefit from exercise of
stock options - 1,739 - - 1,739
Shares tendered for exercise of
stock options (168) (2,843) - - (3,011)
Retirement of treasury stock (80) (895) - - (975)
Currency translation adjustment - - (474) - (474)
Net income - - - 21,957 21,957
Cash dividends ($.65 per share) - - - (12,787) (12,787)
Balance, December 31, 1996 19,725 811 833 38,469 59,838
Shares issued for stock options 157 1,625 - - 1,782
Income tax benefit from exercise of
stock options - 448 - - 448
Shares tendered for exercise of
stock options (52) (987) - - (1,039)
Currency translation adjustment - - (762) - (762)
Net income - - - 21,315 21,315
Cash dividends ($.735 per share) - - - (14,536) (14,536)
Balance, December 31, 1997 $19,830 $ 1,897 $ 71 $ 45,248 $ 67,046
The accompanying notes are an integral part of these financial statements.
</TABLE>
- 20 -
<PAGE>
<TABLE>
HELIX TECHNOLOGY CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
For the years ended December 31,
(in thousands) 1997 1996 1995
- ---------------------------------------------------------------------------------------------------------------------------
Cash flows from operating activities:
<S> <C> <C> <C>
Net income $ 21,315 $ 21,957 $ 20,985
Adjustments to reconcile net income to net
cash provided (used) by operating activities:
Depreciation and amortization 3,176 3,235 2,562
Decrease in noncurrent deferred income taxes - (388) (174)
Undistributed earnings of joint venture, other (1,527) (962) (418)
Increase in accrual for performance-based
executive compensation 1,300 750 1,938
Net change in other operating assets and liabilities (1) (732) 2,092 (665)
Net cash provided by operating activities 23,532 26,684 24,228
Cash flows from investing activities:
Capital expenditures (4,518) (3,291) (3,051)
Net cash used by investing activities (4,518) (3,291) (3,051)
Cash flows from financing activities:
Decrease in capital lease obligations - - (36)
Shares tendered for exercise of stock options (1,039) (3,011) (2,555)
Net cash provided by employee stock plans 543 1,061 713
Purchase of treasury stock - (975) -
Cash dividends paid (14,536) (12,787) (5,652)
Net cash used by financing activities (15,032) (15,712) (7,530)
Increase in cash and cash equivalents 3,982 7,681 13,647
Cash and cash equivalents, January 1 29,378 21,697 8,050
Cash and cash equivalents, December 31 $ 33,360 $ 29,378 $ 21,697
(1) Change in other operating assets and liabilities:
(Increase)/decrease in accounts receivable $ (3,846) $ 6,449 $ (5,755)
(Increase)/decrease in inventories 1,083 (248) (2,566)
(Increase)/decrease in other current assets (1,055) (661) (549)
Increase/(decrease) in accounts payable (85) (1,778) 1,662
Increase/(decrease) in other accrued expenses 3,171 (1,670) 6,543
Net change in other operating assets and liabilities $ (732) $ 2,092 $ (665)
Income taxes paid $ 9,992 $ 15,288 $ 8,217
Supplemental disclosure of non-cash activity:
In 1997 and 1996, $1,240,000 and $775,000, respectively, was reclassed from
accrued executive compensation to equity in connection with issuance of stock
options.
The accompanying notes are an integral part of these financial statements.
</TABLE>
- 21 -
<PAGE>
HELIX TECHNOLOGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
A. Summary of Significant Accounting Policies
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ
from those estimates. Certain reclassifications have been made to prior
years' consolidated financial statements to conform with the current
presentation.
Principles of Consolidation
The consolidated financial statements include the accounts of the Company
and its wholly owned subsidiaries after elimination of all intercompany
transactions. The investment in and operating results of the Company's
50%-owned joint venture are included on the basis of the equity method of
accounting.
Foreign Currency Translation
Assets and liabilities of operations outside of the United States are
translated into U.S. dollars using current exchange rates. Income and
expense accounts are translated at the average rates in effect during the
year. The effects of foreign currency translation adjustments are
included as a component of stockholders' equity. The cumulative
translation adjustment for the Company's 50%-owned joint venture is
reported net of income taxes. Transaction gains/losses were not material.
The effect of foreign currency exchange rates on cash and cash
equivalents was not material.
Cash and Cash Equivalents
Short-term investments with original maturities or put features of three
months or less from the date of purchase are classified as cash
equivalents. Cash and cash equivalents include demand deposits, overnight
repurchase agreements fully collateralized by U.S. Government-backed
securities, and U.S. Government-backed variable rate demand notes.
Financial Instruments
Financial instruments that potentially subject the Company to significant
concentrations of credit risk consist principally of cash and cash
equivalents and trade accounts receivable. The Company generally invests
its cash investments in investment-grade securities. The Company's
customers are concentrated in one industry segment, the semiconductor
manufacturing industry, and, historically, a significant portion of the
Company's sales have been to a limited number of customers within this
industry. The Company performs ongoing credit evaluations of its
customers' financial condition and may require deposits on large orders
but does not require collateral or other security to support customer
receivables.
- 22 -
<PAGE>
HELIX TECHNOLOGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
A. Summary of Significant Accounting Policies (continued)
Inventories
December 31,
(in thousands) 1997 1996
-------------------------------------------------------------------------
Finished goods $ 3,846 $ 3,854
Work in process 6,460 7,655
Materials and parts 981 861
Net inventories $11,287 $12,370
Inventories are stated at the lower of cost or market on a first-in,
first-out basis.
Property, Plant and Equipment
December 31,
(in thousands) 1997 1996
-------------------------------------------------------------------------
Machinery and equipment $23,985 $21,488
Leasehold improvements 3,109 2,731
Total $27,094 $24,219
Depreciation is provided on the straight-line method over the
estimated useful lives of the assets. Leasehold improvements are
amortized over the lesser of their useful life or the remaining life of
the lease. Estimated useful lives of machinery and equipment range from
3 to 10 years.
Maintenance and repairs are charged to expense as incurred, and
betterments are capitalized. The cost of assets sold or retired and
related depreciation are removed from the accounts at the time of sale
and any resulting gain or loss is reflected in income.
Revenue Recognition
The Company records revenue on its products when units are shipped and
when services are performed.
Research and Development
Research and development costs are expensed as incurred.
Income Taxes
Deferred income taxes result from temporary differences in the
recognition of revenues and expenses between financial statements and tax
returns. Tax credits are recognized when realized for tax purposes using
the "flow-through" method of accounting. The Company has not provided for
federal income taxes applicable to undistributed earnings of its foreign
subsidiaries since these earnings are indefinitely reinvested.
- 23 -
<PAGE>
HELIX TECHNOLOGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
A. Summary of Significant Accounting Policies (continued)
Net Income Per Share
The Company has adopted Financial Accounting Standards No. 128 which
specifies the computation, presentation and disclosure of net income per
share. Basic net income per common share is based on the weighted average
number of common shares outstanding during the year. Diluted net income
per common share reflects the potential dilution that could occur if
outstanding stock options were exercised. All prior period net income per
share figures have been restated.
New Accounting Pronouncements
In June 1997, the Financial Accounting Standards Board issued Financial
Accounting Standards No. 130, "Reporting Comprehensive Income" (SFAS
130). SFAS 130 establishes standards for the reporting and display of
comprehensive income and its components in a full set of general purpose
financial statements. Comprehensive income is defined as the change in
equity of a business enterprise during a period from transactions and
other events and circumstances from nonowner sources. The impact of
adopting SFAS 130, which is effective for the Company in 1998, has not
been determined.
In June 1997, the Financial Accounting Standards Board issued Financial
Accounting Standards No. 131, "Disclosure about Segments of an Enterprise
and Related Information" (SFAS 131). SFAS 131 requires public companies
to report segment information on the basis used internally to measure
segment performance in complete financial statements and in condensed
interim financials issued to stockholders. This segment information
includes their products and services, the geographic areas in which they
operate and their major customers. The impact of adopting SFAS 131, which
is effective for the Company in 1998, has not been determined.
B. Bank Credit Arrangements
The Company's informal bank money market lines of credit amounted to
$12,000,000 on December 31, 1997 and 1996.
C. Lease Obligations and Commitments
The Company leases its facilities and certain equipment under long-term
operating leases. The Company has a noncancelable operating lease for its
corporate headquarters and manufacturing operations, which expires
December 31, 2006. The lease includes scheduled base rent increases
through the term of the lease and renewal options for up to fifteen
additional years.
- 24 -
<PAGE>
HELIX TECHNOLOGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
C. Lease Obligations and Commitments (continued)
Future minimum lease payments under the noncancelable operating leases
are:
(in thousands) Operating Leases
-------------------------------------------------------------------------
1998 $ 3,035
1999 2,774
2000 2,202
2001 1,935
2002 2,116
Later Years 8,228
Total $20,290
Total rental expense under operating leases was $3,108,100 in 1997,
$3,018,138 in 1996, and $3,028,445 in 1995.
The Company enters into short-term foreign currency forward contracts
with its primary bank to minimize the effect of foreign currency on
certain intercompany transactions with its wholly owned European
subsidiaries. Net realized and unrealized gains and losses on these
transactions are not material and are recorded in the statements of
operations. The notional amounts of the Company's outstanding foreign
currency forward contracts at December 31, 1997 and 1996, were $2,224,442
and $477,000, respectively.
D. Income Taxes
The provisions for income taxes are as follows:
(in thousands) 1997 1996 1995
-------------------------------------------------------------------------
Current tax expense:
Federal $10,096 $10,593 $ 9,816
State 1,632 2,369 2,443
Foreign 250 285 1,223
Total current 11,978 13,247 13,482
Deferred tax expense:
Federal (656) (624) (710)
State (145) (138) (43)
Total deferred (801) (762) (753)
Total provision for taxes $11,177 $12,485 $12,729
- 25 -
<PAGE>
HELIX TECHNOLOGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
D. Income Taxes (continued)
Significant components of deferred income taxes are as follows:
December 31,
(in thousands) 1997 1996
-------------------------------------------------------------------------
Gross deferred assets:
Inventory valuation $ 1,312 $ 1,181
Compensation and benefit plans 2,483 1,994
Leases 262 300
Other 211 159
Total gross deferred assets $ 4,268 $ 3,634
Gross deferred liabilities:
Depreciation $ (53) $ (220)
Total gross deferred liabilities $ (53) $ (220)
Net deferred assets $ 4,215 $ 3,414
Deferred income taxes on undistributed earnings of the foreign
subsidiaries are not material. The Company believes that its deferred tax
assets are realizable; therefore, no valuation allowance is required.
Domestic income before income taxes was approximately $31,780,000,
$33,870,000 and $31,065,000 in 1997, 1996 and 1995, respectively. Foreign
income before income taxes for the same years was approximately $712,000,
$572,000 and $2,649,000, in 1997, 1996 and 1995, respectively.
The following table reconciles income tax based on the federal statutory
rate to the income tax provision in the statements of operations:
(in thousands) 1997 1996 1995
-------------------------------------------------------------------------
Federal tax computed at
statutory rate of 35% $11,372 $12,055 $11,800
State income taxes, net of
federal tax benefit 966 1,450 1,545
Foreign sales corporation
tax benefit (907) (923) (704)
Earnings not subject to U.S.
income taxes (414) (333) (287)
R&D tax credit (425) (150) (100)
Other 585 386 475
Income tax provision $11,177 $12,485 $12,729
Effective tax rate 34.40% 36.25% 37.75%
E. Capital Stock
On October 16, 1997, the Company's Board of Directors authorized a
two-for-one common stock split that was effected in the form of a 100%
stock dividend. Stock certificates were distributed on November 13, 1997,
to stockholders of record on October 30, 1997. All references in the
- 26 -
<PAGE>
HELIX TECHNOLOGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
E. Capital Stock (continued)
financial statements and notes to number of shares, per share amounts and
market prices of the Company's common stock have been retroactively
restated to reflect the increased number of common shares outstanding.
Options for the purchase of shares of the Company's common stock have
been granted to officers, directors and key employees under various
incentive and nonqualified stock option agreements. The terms of these
agreements provide that the options are exercisable over a number of
years from the date of grant at not less than the fair market value at
the date of grant.
Options expire at various dates through the year 2007. At December 31,
1997 and 1996, respectively, 1,313,774 and 1,525,000 shares of common
stock were reserved for stock options. At December 31, 1997 and 1996,
respectively, 75,774 and 94,250 nonqualified stock options were
exercisable. In 1989, the Company entered into an agreement with its
President under which options to purchase up to 800,000 shares of the
Company's common stock were granted, at a price of $1.69 per share,
exercisable over a ten-year period subject to the attainment of certain
financial performance targets. Based on 1997 performance, options for the
purchase of 80,000 shares will become exercisable on March 1, 1998. Based
on 1996, 1995 and 1994 performance, options for the purchase of 80,000
shares became exercisable on March 1, 1997, March 1, 1996, and March 1,
1995, respectively. In addition, based on cumulative performance for the
five-year period ended December 31, 1994, 240,000 shares became
exercisable on March 1, 1995. In connection with this agreement,
compensation expense of $1,300,000, $750,000 and $1,938,000 was charged
to "Selling, general and administrative expenses" in 1997, 1996 and 1995,
respectively.
The following table summarizes option activity for the years ended 1997,
1996 and 1995:
Number of Weighted Average
Options Outstanding Common Shares Exercise Price
-------------------------------------------------------------------------
December 31, 1994 1,231,100 $ 2.25
Options granted 35,000 $ 10.76
Options exercised (370,700) $ 1.92
December 31, 1995 895,400 $ 2.71
Options granted 140,000 $ 16.40
Options exercised (420,400) $ 2.52
December 31, 1996 615,000 $ 5.95
Options granted 121,000 $ 20.90
Options exercised (157,226) $ 3.45
Options cancelled (82,000) $ 14.66
December 31, 1997 496,774 $ 8.95
- 27 -
<PAGE>
HELIX TECHNOLOGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
E. Capital Stock (continued)
The following table summarizes information concerning currently
outstanding and exercisable options:
<TABLE>
<CAPTION>
Options Outstanding Options Exercisable
------------------------------------------------------- -------------------------------
Range of Number Weighted Average Weighted Number Weighted
Exercise Outstanding Remaining Average Exercisable Average
Prices at 12/31/97 Contractual Life Exercise Price at 12/31/97 Exercise Price
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$ 1.69 - $ 1.69 240,000 2.28 years $ 1.69 - -
$ 2.86 - $ 18.37 174,774 7.50 years $ 12.53 65,774 $ 5.45
$ 18.44 - $ 27.03 82,000 6.41 years $ 22.56 10,000 $ 18.44
</TABLE>
The Company adopted the disclosure only option under Statement of
Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation" (SFAS 123) as of December 31, 1996. If the accounting
provisions of SFAS 123 had been adopted, the effect on net income and
basic and diluted net income per share would have been as follows:
(in thousands except per share data) 1997 1996 1995
-------------------------------------------------------------------------
As Reported
Net income $ 21,315 $ 21,957 $ 20,985
Basic net income per share $ 1.08 $ 1.12 $ 1.08
Diluted net income per share $ 1.07 $ 1.10 $ 1.05
Proforma
Net income $ 21,142 $ 21,846 $ 20,967
Basic net income per share $ 1.07 $ 1.11 $ 1.08
Diluted net income per share $ 1.06 $ 1.09 $ 1.05
The weighted average fair value of options granted during 1997, 1996 and
1995 was $8.06, $6.16 and $4.45, respectively. The fair value of each
option grant is estimated on the date of grant using the Black-Scholes
option-pricing model with the following weighted-average assumptions used
for grants:
1997 1996 1995
-------------------------------------------------------------------------
Dividend yield 4.2% 4.2% 4.2%
Expected stock price volatility 50% 50% 50%
Risk-free interest rate 6.34% 6.08% 7.29%
Expected holding period (years) 6.4 6.3 8.0
- 28 -
<PAGE>
HELIX TECHNOLOGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
F. Other Assets
The Company has a 50/50 joint venture company, Ulvac Cryogenics, Inc.,
with an unrelated Japanese manufacturer to produce cryogenic vacuum pumps
in Japan.
Condensed results of operations for the joint venture for each of the
three years ended September 30, are as follows:
(in thousands) 1997 1996 1995
-------------------------------------------------------------------------
Net sales $27,638 $25,751 $27,845
Gross profit $ 8,488 $ 7,415 $ 7,894
Net income $ 2,364 $ 1,901 $ 1,642
Fee income, including royalty income
and equity income $ 1,744 $ 1,480 $ 1,392
Condensed balance sheet information as of September 30, is as follows:
(in thousands) 1997 1996
-------------------------------------------------------------------------
Current assets $20,724 $18,399
Noncurrent assets 3,399 3,565
Total assets $24,123 $21,964
Current liabilities $ 9,710 $ 8,654
Long-term liabilities 915 902
Stockholders' equity 13,498 12,408
Total liabilities and stockholders' equity $24,123 $21,964
The Company's net investment in the joint venture of approximately
$6,552,000 and $5,792,000 at December 31, 1997 and 1996, respectively, is
included in "Other assets." The Company's net investment at December 31,
1997 and 1996, reflects a cumulative translation adjustment of $366,000
and $766,000, respectively (net of income taxes of $197,000 and $412,000,
respectively). This currency translation adjustment, which is also shown
as a separate component of stockholders' equity, resulted from
translating the balance sheet of the joint venture into U.S. dollars.
G. Segment Information
Line of Business and Foreign Operations
The Company operates in one line of business; the development,
manufacture, sale and support of cryogenic and vacuum equipment.
- 29 -
<PAGE>
HELIX TECHNOLOGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
G. Segment Information (continued)
The consolidated financial statements include the accounts of wholly
owned European subsidiaries which operate customer support facilities to
sell and service products manufactured in the United States. A summary of
United States and European operations follows:
Corporate
Expenses
United and Assets/
(in thousands) States Europe Eliminations Consolidated
-------------------------------------------------------------------------
1997
Revenues $126,891 $13,993 $(9,365) $131,519
Operating income 33,634 751 (5,164) 29,221
Identifiable assets 42,710 7,457 31,499 81,666
1996
Revenues $123,893 $13,093 $(8,603) $128,383
Operating income 35,249 561 (4,098) 31,712
Identifiable assets 37,018 7,183 27,558 71,759
1995
Revenues $117,407 $14,400 $(8,140) $123,667
Operating income 34,362 2,806 (5,363) 31,805
Identifiable assets 39,588 9,209 20,277 69,074
Corporate expenses consist of certain general and administrative expenses
not allocable to operations. Corporate assets consist primarily of cash
and cash equivalents. Intercompany transactions are at prices that are
comparable to third party sales.
Export Sales and Significant Customers
The Company's export sales, principally to customers in the Far East,
were $10,643,000 in 1997, $9,684,000 in 1996 and $8,330,000 in 1995.
The Company's largest customer represented 29%, 28% and 30% of sales for
1997, 1996 and 1995, respectively.
- 30 -
<PAGE>
HELIX TECHNOLOGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
H. Employee Benefit Plans
The Company's retirement and savings plans cover substantially all of the
Company's employees who have one year of service. A noncontributory
defined benefit pension plan and a defined contribution plan function
together as the Company's retirement program. In 1994, the Company
discontinued future contributions to the Company's defined contribution
plan.
The Company's funding policy is to contribute not less than the minimum
required amount in accordance with the Internal Revenue Code and ERISA.
The following table sets forth the funded status of the defined benefit
pension plan at December 31, 1997 and 1996, in accordance with SFAS No.
87.
(in thousands) 1997 1996
-------------------------------------------------------------------------
Accumulated benefit obligation, including
nonvested benefit obligations of $150
and $85 in 1997 and 1996, respectively $(2,836) $(3,346)
Projected benefit obligation (6,369) (5,964)
Plan assets at fair value 8,190 7,553
Plan assets in excess of projected benefit
obligations 1,821 1,589
Unrecognized net transition asset (223) (262)
Unrecognized prior service cost 52 60
Unrecognized net gain (4,135) (3,196)
Accrued pension cost recognized on the
consolidated balance sheets $(2,485) $(1,809)
The Company's net pension cost included the following components:
(in thousands) 1997 1996 1995
-------------------------------------------------------------------------
Service cost $ 894 $ 840 $ 664
Interest cost 482 443 470
Actual return on plan assets (1,941) (1,024) (1,396)
Net amortization and deferral 1,241 450 882
Net pension cost of defined benefit plan $ 676 $ 709 $ 620
- 31 -
<PAGE>
HELIX TECHNOLOGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
H. Employee Benefit Plans (continued)
Key assumptions used in computing year end obligations for the defined
benefit plan were:
1997 1996 1995
-------------------------------------------------------------------------
Discount rate for obligations 7.0% 7.5% 7.0%
Rate of compensation increase 5.0% 5.5% 5.0%
Long-term rate of return on assets 9.0% 9.0% 9.0%
Defined benefit plan assets include marketable equity securities,
corporate and government debt securities and cash.
The Company has an Employee Savings Plan, qualified under Section 401(k),
that is designed to supplement income to be received from the Company's
retirement program. The Company contributes a percentage of the
participants' contributions up to a defined maximum amount. The matching
contributions expense, net of forfeitures, was $457,000 in 1997, $421,000
in 1996 and $383,000 in 1995.
In 1992, the Company adopted a Supplemental Key Executive Retirement Plan
which is designed to supplement benefits paid to participants under
Company-funded tax-qualified retirement plans. The Company recorded
additional retirement costs of $69,000 in 1997, $140,000 in 1996 and
$130,000 in 1995 in connection with this Plan.
- 32 -
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To The Board Of Directors and Stockholders
of Helix Technology Corporation:
Our report on the consolidated financial statements of Helix Technology
Corporation is included on Page 17 of this Form 10-K. In connection with our
audits of such financial statements, we have also audited the related financial
statement schedule listed in the index on Page 9 of this Form 10-K.
In our opinion, the financial statement schedule referred to above,
when considered in relation to the basic financial statements taken as a whole,
presents fairly, in all material respects, the information required to be
included therein.
/S/ Coopers & Lybrand L.L.P.
--------------------------------
Coopers & Lybrand L.L.P.
Boston, Massachusetts
February 6, 1998
- 33 -
<PAGE>
HELIX TECHNOLOGY CORPORATION
QUARTERLY RESULTS
(UNAUDITED)
First Second Third Fourth
(in thousands except per share data) Quarter Quarter Quarter Quarter
- --------------------------------------------------------------------------------
1997
Net sales $29,022 $32,931 $35,622 $33,944
Gross profit 13,463 15,430 16,752 16,664
Operating income 5,843 7,049 8,259 8,070
Net income 4,158 5,121 6,032 6,004
Basic net income per share (1) $ .21 $ .26 $ .31 $ .30
Diluted net income per share (1) $ .21 $ .26 $ .30 $ .30
1996
Net sales $40,206 $39,351 $25,122 $23,704
Gross profit 18,967 18,771 11,653 10,911
Operating income 11,251 11,259 4,971 4,231
Net income 7,390 7,525 3,875 3,167
Basic net income per share (1) $ .38 $ .38 $ .20 $ .16
Diluted net income per share (1) $ .37 $ .38 $ .19 $ .16
(1) All per share data reflects a two-for-one common stock split effective
November 1997. (Note E)
- 34 -
<PAGE>
<TABLE>
HELIX TECHNOLOGY CORPORATION
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
For the Years Ended December 31, 1997, 1996 and 1995
(in thousands)
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
Column A Column B Column C Column D Column E
- ----------------------------------------------------------------------------------------------------------------------------------
Additions
------------------------------------
Balance at Balance at
Beginning Charged to Charged to Deductions End of
Description of Period Costs and Expenses Other Accounts From Reserves Period
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Year ended December 31, 1997
Allowance for doubtful accounts $148 $ 7 $ - $ 5 $ 150
==================================================================================================================================
Year ended December 31, 1996
Allowance for doubtful accounts $150 $ - $ - $ 2 $ 148
==================================================================================================================================
Year ended December 31, 1995
Allowance for doubtful accounts $157 $ - $ - $ 7 $ 150
==================================================================================================================================
</TABLE>
- 35 -
Exhibit 10.13 EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated as of July 18, 1997 between Robert E. Anastasi
(the "Executive") and Helix Technology Corporation, a Delaware corporation (the
"Company").
WHEREAS, the Company is engaged primarily in the business of providing
cryogenic and vacuum equipment and services principally to semiconductor
equipment manufacturers;
WHEREAS, the Executive currently serves as a Senior Vice President of the
Company;
WHEREAS, the Executive's abilities and services are unique and essential to
the prospects of the Company; and
WHEREAS, the Company and the Executive desire to enter into this Agreement
to provide for the continued employment of the Executive by the Company upon the
terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein, the parties hereby agree as follows:
1. Employment; Term.
(a) Employment. The Company hereby employs the Executive, and the
Executive hereby agrees to be employed by the Company, upon the terms and
subject to the conditions contained in this Agreement.
(b) Term. The term of this Agreement (the "Term") shall commence
on the date hereof and shall continue indefinitely thereafter until terminated
pursuant to Section 4 hereof. As used herein, the term "Employment Period" shall
mean the period commencing on the date hereof and ending on the date of
termination of Executive's employment with the Company pursuant to Section 4
hereof. For purposes of Section 4(d)(ii) the Executive's "Date of Hire" shall be
defined to be July 12, 1979.
2. Position; Duties; Responsibilities.
(a) Position and Duties. The Company shall employ the Executive as
a Senior Vice President of the Company. The Executive shall faithfully and
loyally perform to the best of his abilities all the duties reasonably assigned
to him hereunder, shall devote his full time, attention and effort to the
affairs of the Company as is reasonably necessary for the proper performance of
such duties and shall use his reasonable best efforts to promote the interests
of the Company. Any other commitments or activities which might impinge on the
Executive's full-time performance of such duties shall be reported to and
approved by the Chairman of the Board of Directors of the Company (the "Board")
and the President of the Company.
(b) Responsibilities. The Executive shall have responsibility and
authority for the formulation and execution of the policies relating to the
manufacturing and production operations of the Company and the administration of
its manufacturing and production operations and facilities and such other
responsibilities and authorities as are customarily exercisable by a head of
manufacturing, subject in each case to the general supervision and direction of
the Board, the Chairman of the Board and the President of the Company.
<PAGE>
3. Compensation.
(a) Base Salary. During the Employment Period, the Company shall
pay to the Executive an annual base salary at the rate of $170,000 per annum,
payable in accordance with the Company's executive payroll policy. Such base
salary shall be reviewed annually, commencing January 1, 1998, and may be
increased (but shall not be decreased except in conjunction with a general
reduction of executive salaries), as determined by the Company's Human Resources
and Compensation Committee (the "Compensation Committee"). The Executive's base
salary, as increased or decreased hereunder, is referred to herein as the "Base
Salary."
(b) Annual Performance Bonus. In the discretion of the Company's
Compensation Committee, the Executive shall be eligible to receive an annual
performance bonus payable in cash for each full or partial fiscal year of the
Company during the Employment Period in accordance with the Company's
performance-based bonus program for Executive Officers.
(c) Stock Options. In the discretion of the Company's Compensation
Committee, the Executive shall be eligible to receive from time to time during
the Employment Period options to purchase shares of Company common stock
("Common Stock") pursuant to the terms of the Company's 1996 Equity Incentive
Plan.
(d) Supplemental Key Executive Retirement Plan. In addition to the
compensation and benefits to which the Executive is entitled hereunder, the
Executive shall be entitled to participate in the Company's Supplemental Key
Executive Retirement Plan (the "Supplemental Retirement Plan") in accordance
with its terms.
(e) Reimbursement of Expenses. The Company shall reimburse the
Executive for all expenses necessarily and reasonably incurred by him during the
Employment Period in connection with the business of the Company, upon
presentation of proper receipts or other proof of expenditure and subject to
such reasonable guidelines or limitations as are established by the Company from
time to time.
(f) Participation in Benefit Plans. During the Employment Period,
the Executive shall be entitled to participate in any profit sharing plan,
retirement plan, group life insurance plan or other insurance plan or medical
expense plan maintained by the Company for its senior executives generally.
4. Termination.
(a) Death. Upon the death of the Executive, this Agreement shall
automatically terminate and all rights of the Executive and his heirs, executors
and administrators to compensation and other benefits hereunder shall cease,
except for (i) compensation which shall have accrued to the date of death,
including accrued Base Salary up to the date of termination, prorated Bonus
(based on the same percentage of accrued Base Salary as compared to annual Base
Salary multiplied times the average of the annual Bonuses paid to the Executive
for the three fiscal years of the Company preceding the Executive's death) and
any amounts payable pursuant to the Supplemental Retirement Plan and (ii) the
rights to indemnification under Section 5 hereof.
<PAGE>
(b) Disability. The Company may, at its option, terminate this
Agreement upon written notice to the Executive if the Executive, because of
physical or mental incapacity or disability, fails in any material respect to
perform the services required of him hereunder for a continuous period of 180
days. Upon such termination, all obligations of the Company hereunder shall
cease, except for (i) compensation which shall have accrued to the date of
termination, including accrued Base Salary up to the date of termination,
prorated Bonus (based on the same percentage of accrued Base Salary as compared
to annual Base Salary multiplied times the average of the annual Bonuses paid to
the Executive for the three fiscal years of the Company preceding the
termination of this Agreement pursuant to this Section 4(b)) and any amounts
payable pursuant to the Supplemental Retirement Plan, and (ii) the rights to
indemnification under Section 5 hereof. In the event of any dispute regarding
the existence of the Executive's incapacity hereunder, the matter shall be
resolved by the determination of a majority of three physicians qualified to
practice medicine in the state of the Executive's residence, one to be selected
by each of the Executive and the Board and the third to be selected by such two
designated physicians. For this purpose, the Executive shall submit to
appropriate medical examinations.
(c) Cause. (i) The Company may, at its option, terminate the
Executive's employment under this Agreement for "Cause" (as hereinafter
defined). A termination for Cause shall not take effect until and unless the
Company complies with this Section 4(c)(i). The Executive shall be given written
notice by the Company of the intention to terminate his employment hereunder for
Cause (the "Cause Notice"). The Cause Notice shall state the particular
action(s) or inaction(s) giving rise to termination for Cause.
(ii) As used in this Agreement, the term "Cause" shall mean
any one or more of the following, in any case as determined to have occurred by
not less than two-thirds of the directors then serving on the Board:
(A) the Executive's refusal to perform specific
directives of the Board which are consistent with the scope and nature
of the Executive's duties and responsibilities as set forth herein or a
material violation by Executive of the policies, procedures or rules of
the Company;
(B) the Executive's commission of, or conviction for, a
felony or any act involving fraud, embezzlement, theft,
misrepresentation, dishonesty or moral turpitude;
(C) the Executive's indictment for commission of a
material crime on the basis of alleged facts of such a serious nature
that the Company has reasonable cause to believe that the Executive
cannot effectively discharge the Executive's duties and
responsibilities, or the Executive's indictment for the commission of a
material business related crime;
(D) any gross or willful misconduct of the Executive
resulting in substantial loss to the Company or substantial damage to
the Company's business or reputation;
(E) gross neglect of the Executive's duties resulting
in substantial loss to the Company or substantial damage to the
Company's business or reputation; or
(F) any material breach by the Executive of this
Agreement or any non-competition agreement between the Executive and
the Company.
<PAGE>
(iii) The exercise of the right of the Company to terminate
this Agreement pursuant to this Section 4(c) shall not abrogate the rights or
remedies of the Company in respect of the breach giving rise to such
termination.
(iv) If the Company terminates the Executive's employment for
Cause, he shall be entitled to:
(A) accrued Base Salary through the date of the
termination of his employment;
(B) any amounts owing but not yet paid pursuant to
Section 3(e); and
(C) other or additional benefits to the extent required
by any applicable plans and programs of the Company.
(v) Notwithstanding anything to the contrary contained in this
Agreement, if, following a termination of the Executive's employment for Cause,
a court of competent jurisdiction, in a final determination, determines that the
Executive was not guilty of the conduct that formed the basis for the
termination, the Executive shall be entitled to the payments and the economic
equivalent of the benefits he would have received had his employment been
terminated by the Company without Cause.
(d) Termination Without Cause. If, during the Employment Period,
the Company terminates the employment of the Executive hereunder for any reason
other than a reason set forth in Section 4(a), 4(b) or 4(c):
(i) concurrent with such termination, the Company shall pay to
the Executive an amount equal to his accrued Base Salary up to the date of
termination, prorated Bonus (based on the same percentage of accrued Base Salary
as compared to the annual Base Salary multiplied times the average of the annual
Bonuses paid to the Executive for the three fiscal years of the Company
preceding such termination of employment) and any amounts payable pursuant to
the Supplemental Retirement Plan, in each case accrued through the date of
termination;
(ii) the Company shall continue to pay the Executive his Base
Salary, average Bonus (based on the average of the annual Bonuses paid to the
Executive for the three fiscal years of the Company preceding such termination
of employment divided by the applicable pay period (said Base Salary and average
bonus being payable pro-rata to the Executive on the Company's usual payroll
dates)) and all other benefits which would otherwise be payable hereunder for a
period of twelve months if the effective date of the termination of the
Executive's employment with the Company under this Section 4(d) occurs at least
one year after the Executive's Date of Hire and for a period of twenty-four
months if the effective date of the termination of the Executive's employment
with the Company under this Section 4(d) occurs at least five years after the
Executive's Date of Hire; provided, however, that if, prior to the end of such
period, the Executive shall obtain employment with another employer (the
Executive being obligated to use his or her reasonable best efforts to secure
employment during such period), the amounts otherwise payable pursuant to this
clause (ii) shall be reduced by the amount of compensation earned by the
Executive from his or her new employment during such period (except that in no
event shall any such reduction result in the Executive receiving an amount
pursuant to this clause (ii) that would be less than the amount the Executive
would have earned if his Base Salary, average Bonus and other benefits had been
continued for a period of six months following such termination);
<PAGE>
(iii) the Executive shall be entitled to any amounts owing but
not yet paid pursuant to Section 3(e); and
(iv) the Executive shall be entitled to his rights to
indemnification under Section 5 hereof.
(e) Termination for Good Reason. (i) If, during the Employment
Period, the Executive terminates his employment hereunder for "Good Reason" (as
such term is defined in Section 4(e)(ii) hereof, he or she shall be entitled to
all of the payments and benefits specified by Sections 4(d)(i) through 4(d)(iv)
hereof, inclusive.
(ii) For purposes of this Agreement, "Good Reason" shall
mean, without the Executive's express written consent, the occurrence of any one
or more of the following events:
(A) a material breach of this Agreement by the Company;
(B) the failure to elect or re-elect the Executive to
any position that is at least substantially comparable or more
favorable to the positions described in Section 2 hereof, removal of
the Executive from any such position or any change in the Executive's
responsibilities described in Section 2 in any respect which is
materially adverse to the Executive;
(C) a diminution of any of the Executive's significant
duties or the assignment to the Executive of any duties inconsistent
with his duties or the material impairment of the Executive's ability
to function in the positions described in Section 2 hereof, in each
case only after the Company shall have had an opportunity to cure (any
such cure to be effected within 30 days after appropriate written
notice of the basis for Good Reason is given to the Company by the
Executive);
(D) a material reduction of any benefit enjoyed by the
Executive or the failure to continue the Executive's participation in
any incentive compensation plan, unless a plan providing a
substantially similar economic opportunity is substituted or all senior
executives suffer a substantially similar reduction or failure;
(E) the relocation of the Executive's office to a
location more than 50 miles from Mansfield, Massachusetts; or
(F) the failure of the Company to obtain the assumption
in writing of its obligation to perform this Agreement by any successor
to all or substantially all of the assets of the Company within 15 days
after a merger, consolidation, sale of assets or similar transaction.
(f) Voluntary Termination. If, during the Employment Period, the
Executive voluntarily terminates his employment hereunder for any reason other
than Good Reason, he shall be entitled to the payments specified by Sections
4(c)(iv)(A) through 4(c)(iv)(C) hereof, inclusive.
5. Indemnification. To the fullest extent permitted by law, the
Certificate of Incorporation of the Company, the By-laws of the Company or any
indemnification agreement entered into between the Company and the Executive,
the Executive (and his heirs, executors and administrators) shall be indemnified
by the Company and its successors and assigns. The obligations of the Company
pursuant to this Section 5 shall survive the termination of the Employment
Period, except as otherwise provided herein.
<PAGE>
6. Non-Competition. For a period of three years following termination
of the Executive's employment with the Company for any reason except as set
forth below, the Executive agrees that he will not accept or continue to hold
any position in any capacity, whether as an employee, agent, consultant,
investor, director or otherwise, with any person, firm or corporation, whose
present or planned business is competitive with the business of the Company as
it exists on the date of the termination of the Executive's employment with the
Company. In the event the Executive's employment with the Company is terminated
by the Company without Cause or by the Executive for Good Reason, the foregoing
non-competition covenant shall apply for two years following the date of the
termination of the Executive's employment with the Company. The foregoing
non-competition covenant shall not apply to the Executive in any given instance
if the Board waives said covenant in writing with respect to that instance.
Ownership by the Executive of less than one percent (1%) of the outstanding
stock or securities in any business enterprise shall not itself be deemed to be
engaging in any activity prohibited by this Section 6.
7. Trade Secrets. If the Executive has not already done so, the
Executive agrees to execute and abide by the Company's standard form of
agreement presently in effect protecting the Company's inventions, patents and
proprietary and confidential information and the Executive agrees to execute and
abide by any subsequent agreement generally in effect for the Company's officers
and key employees.
8. Insurance. The Company may, at its election and for its benefit,
insure the Executive against disability, accidental loss or death and the
Executive shall submit to such physical examinations and supply such information
as may be required in connection therewith.
9. Assignment. The rights and benefits of the Executive hereunder
shall not be assignable, whether by voluntary or involuntary assignment or
transfer. This Agreement shall be binding upon, and inure to the benefit
of, the successors and assigns of the Company, and the heirs, executors and
administrators of the Executive, and shall be assignable by the Company to any
entity acquiring substantially all of the assets of the Company, whether by
merger, consolidation, sale of assets or similar transaction.
10. Notices. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and personally delivered, sent by
certified or registered mail or sent by overnight courier service as follows: if
to the Executive, to his address as set forth in the records of the Company, and
if to the Company, to the address of its principal executive offices, attention:
President, with a copy to William Williams II, Esquire, Palmer & Dodge LLP, One
Beacon Street, Boston, MA 02108, or to any other address designated by any party
hereto by notice similarly given.
11. Waiver of Breach. A waiver by the Company or the Executive of any
breach of any provision of this Agreement by the other party shall not operate
or be construed as a waiver of any other or subsequent breach by the other
party.
12. Entire Agreement. This Agreement contains the entire agreement of
the parties with respect to the subject matter hereof. This Agreement may be
modified only by an agreement in writing signed by the parties hereto.
<PAGE>
13. Severability. In case any one or more of the provisions contained
in this Agreement shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Agreement, but this Agreement shall
be construed as if such invalid, illegal or unenforceable provision had never
been contained herein. If, moreover, any one or more of the provisions contained
in this Agreement shall for any reason be held to be excessively broad as to
time, duration, geographical scope, activity or subject, it shall be construed,
by limiting and reducing it, so as to be enforceable to the extent compatible
with the applicable law as it shall then appear.
14. Costs. In the event that a dispute shall arise between the parties
hereto with respect to any term or provision of this Agreement or the subject
matter hereof, all costs and expenses (including attorney fees incurred by the
Company or the Executive associated with such dispute) shall be borne by the
respective party incurring such costs and expenses; provided, however, that if
such dispute is ultimately determined in favor of Executive by a court of
competent jurisdictions, then the Company shall be required to reimburse the
Executive for up to an aggregate $100,000 of such costs and expenses actually
incurred by the Executive in connection with such dispute.
15. Interpretation; Applicable Law. This Agreement and its terms are
subject to reasonable interpretation by the Compensation Committee in its sole
discretion. The terms of this Agreement shall be governed by and construed in
accordance with the internal laws (as opposed to the conflict of laws
provisions) of the Commonwealth of Massachusetts.
16. Complete Agreement. This Agreement supersedes all other prior
agreements between the Executive and the Company concerning the Executive's
employment with the Company, and none of such agreements shall be of any force
or effect whatsoever; provided, however, that nothing contained herein shall be
deemed to limit or otherwise affect the provisions of any non-competition
agreement or code of conduct arrangement between the Executive and the Company
or the provisions of any other agreement, arrangement or policy concerning the
Executive and the Company that is unrelated to the subject matter of this
Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
HELIX TECHNOLOGY CORPORATION
By:/s/ Robert J. Lepofsky
----------------------------
President
EXECUTIVE:
/s/ Robert E. Anastasi
----------------------------
Robert E. Anastasi
Exhibit 10.14 EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated as of July 18, 1997 between Michael El-Hillow
(the "Executive") and Helix Technology Corporation, a Delaware corporation (the
"Company").
WHEREAS, the Company is engaged primarily in the business of providing
cryogenic and vacuum equipment and services principally to semiconductor
equipment manufacturers;
WHEREAS, the Executive currently serves as a Senior Vice President of the
Company;
WHEREAS, the Executive's abilities and services are unique and essential to
the prospects of the Company; and
WHEREAS, the Company and the Executive desire to enter into this Agreement
to provide for the continued employment of the Executive by the Company upon the
terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein, the parties hereby agree as follows:
1. Employment; Term.
(a) Employment. The Company hereby employs the Executive, and the
Executive hereby agrees to be employed by the Company, upon the terms and
subject to the conditions contained in this Agreement.
(b) Term. The term of this Agreement (the "Term") shall commence
on the date hereof and shall continue indefinitely thereafter until terminated
pursuant to Section 4 hereof. As used herein, the term "Employment Period" shall
mean the period commencing on the date hereof and ending on the date of
termination of Executive's employment with the Company pursuant to Section 4
hereof. For purposes of Section 4(d)(ii) the Executive's "Date of Hire" shall be
defined to be April 18, 1997.
2. Position; Duties; Responsibilities.
(a) Position and Duties. The Company shall employ the Executive as
a Senior Vice President of the Company. The Executive shall faithfully and
loyally perform to the best of his abilities all the duties reasonably assigned
to him hereunder, shall devote his full time, attention and effort to the
affairs of the Company as is reasonably necessary for the proper performance of
such duties and shall use his reasonable best efforts to promote the interests
of the Company. Any other commitments or activities which might impinge on the
Executive's full-time performance of such duties shall be reported to and
approved by the Chairman of the Board of Directors of the Company (the "Board")
and the President of the Company.
(b) Responsibilities. The Executive shall have responsibility and
authority for the formulation and execution of the policies relating to the
financial and accounting functions of the Company and the administration of the
financial and accounting department and fringe benefit matters and such other
responsibilities and authorities as are customarily exercisable by a chief
financial officer and chief accounting officer, subject in each case to the
general supervision and direction of the Board, the Chairman of the Board and
the President of the Company.
<PAGE>
3. Compensation.
(a) Base Salary. During the Employment Period, the Company shall
pay to the Executive an annual base salary at the rate of $170,000 per annum,
payable in accordance with the Company's executive payroll policy. Such base
salary shall be reviewed annually, commencing January 1, 1998, and may be
increased (but shall not be decreased except in conjunction with a general
reduction of executive salaries), as determined by the Company's Human Resources
and Compensation Committee (the "Compensation Committee"). The Executive's base
salary, as increased or decreased hereunder, is referred to herein as the "Base
Salary."
(b) Annual Performance Bonus. In the discretion of the Company's
Compensation Committee, the Executive shall be eligible to receive an annual
performance bonus payable in cash for each full or partial fiscal year of the
Company during the Employment Period in accordance with the Company's
performance-based bonus program for Executive Officers.
(c) Stock Options. In the discretion of the Company's Compensation
Committee, the Executive shall be eligible to receive from time to time during
the Employment Period options to purchase shares of Company common stock
("Common Stock") pursuant to the terms of the Company's 1996 Equity Incentive
Plan.
(d) Supplemental Key Executive Retirement Plan. In addition to the
compensation and benefits to which the Executive is entitled hereunder, the
Executive shall be entitled to participate in the Company's Supplemental Key
Executive Retirement Plan (the "Supplemental Retirement Plan") in accordance
with its terms.
(e) Reimbursement of Expenses. The Company shall reimburse the
Executive for all expenses necessarily and reasonably incurred by him during the
Employment Period in connection with the business of the Company, upon
presentation of proper receipts or other proof of expenditure and subject to
such reasonable guidelines or limitations as are established by the Company from
time to time.
(f) Participation in Benefit Plans. During the Employment Period,
the Executive shall be entitled to participate in any profit sharing plan,
retirement plan, group life insurance plan or other insurance plan or medical
expense plan maintained by the Company for its senior executives generally.
4. Termination.
(a) Death. Upon the death of the Executive, this Agreement shall
automatically terminate and all rights of the Executive and his heirs, executors
and administrators to compensation and other benefits hereunder shall cease,
except for (i) compensation which shall have accrued to the date of death,
including accrued Base Salary up to the date of termination, prorated Bonus
(based on the same percentage of accrued Base Salary as compared to annual Base
Salary multiplied times the average of the annual Bonuses paid to the Executive
for the three fiscal years of the Company preceding the Executive's death) and
any amounts payable pursuant to the Supplemental Retirement Plan and (ii) the
rights to indemnification under Section 5 hereof.
<PAGE>
(b) Disability. The Company may, at its option, terminate this
Agreement upon written notice to the Executive if the Executive, because of
physical or mental incapacity or disability, fails in any material respect to
perform the services required of him hereunder for a continuous period of 180
days. Upon such termination, all obligations of the Company hereunder shall
cease, except for (i) compensation which shall have accrued to the date of
termination, including accrued Base Salary up to the date of termination,
prorated Bonus (based on the same percentage of accrued Base Salary as compared
to annual Base Salary multiplied times the average of the annual Bonuses paid to
the Executive for the three fiscal years of the Company preceding the
termination of this Agreement pursuant to this Section 4(b)) and any amounts
payable pursuant to the Supplemental Retirement Plan, and (ii) the rights to
indemnification under Section 5 hereof. In the event of any dispute regarding
the existence of the Executive's incapacity hereunder, the matter shall be
resolved by the determination of a majority of three physicians qualified to
practice medicine in the state of the Executive's residence, one to be selected
by each of the Executive and the Board and the third to be selected by such two
designated physicians. For this purpose, the Executive shall submit to
appropriate medical examinations.
(c) Cause. (i) The Company may, at its option, terminate the
Executive's employment under this Agreement for "Cause" (as hereinafter
defined). A termination for Cause shall not take effect until and unless the
Company complies with this Section 4(c)(i). The Executive shall be given written
notice by the Company of the intention to terminate his employment hereunder for
Cause (the "Cause Notice"). The Cause Notice shall state the particular
action(s) or inaction(s) giving rise to termination for Cause.
(ii) As used in this Agreement, the term "Cause" shall mean
any one or more of the following, in any case as determined to have occurred by
not less than two-thirds of the directors then serving on the Board:
(A) the Executive's refusal to perform specific
directives of the Board which are consistent with the scope and nature
of the Executive's duties and responsibilities as set forth herein or a
material violation by Executive of the policies, procedures or rules of
the Company;
(B) the Executive's commission of, or conviction for, a
felony or any act involving fraud, embezzlement, theft,
misrepresentation, dishonesty or moral turpitude;
(C) the Executive's indictment for commission of a
material crime on the basis of alleged facts of such a serious nature
that the Company has reasonable cause to believe that the Executive
cannot effectively discharge the Executive's duties and
responsibilities, or the Executive's indictment for the commission of a
material business related crime;
(D) any gross or willful misconduct of the Executive
resulting in substantial loss to the Company or substantial damage to
the Company's business or reputation;
(E) gross neglect of the Executive's duties resulting
in substantial loss to the Company or substantial damage to the
Company's business or reputation; or
(F) any material breach by the Executive of this
Agreement or any non-competition agreement between the Executive
and the Company.
<PAGE>
(iii) The exercise of the right of the Company to terminate
this Agreement pursuant to this Section 4(c) shall not abrogate the rights or
remedies of the Company in respect of the breach giving rise to such
termination.
(iv) If the Company terminates the Executive's employment for
Cause, he shall be entitled to:
(A) accrued Base Salary through the date of the
termination of his employment;
(B) any amounts owing but not yet paid pursuant to
Section 3(e); and
(C) other or additional benefits to the extent required
by any applicable plans and programs of the Company.
(v) Notwithstanding anything to the contrary contained in this
Agreement, if, following a termination of the Executive's employment for Cause,
a court of competent jurisdiction, in a final determination, determines that the
Executive was not guilty of the conduct that formed the basis for the
termination, the Executive shall be entitled to the payments and the economic
equivalent of the benefits he would have received had his employment been
terminated by the Company without Cause.
(d) Termination Without Cause. If, during the Employment Period,
the Company terminates the employment of the Executive hereunder for any reason
other than a reason set forth in Section 4(a), 4(b) or 4(c):
(i) concurrent with such termination, the Company shall pay to
the Executive an amount equal to his accrued Base Salary up to the date of
termination, prorated Bonus (based on the same percentage of accrued Base Salary
as compared to the annual Base Salary multiplied times the average of the annual
Bonuses paid to the Executive for the three fiscal years of the Company
preceding such termination of employment) and any amounts payable pursuant to
the Supplemental Retirement Plan, in each case accrued through the date of
termination;
(ii) the Company shall continue to pay the Executive his Base
Salary, average Bonus (based on the average of the annual Bonuses paid to the
Executive for the three fiscal years of the Company preceding such termination
of employment divided by the applicable pay period (said Base Salary and average
bonus being payable pro-rata to the Executive on the Company's usual payroll
dates)) and all other benefits which would otherwise be payable hereunder for a
period of twelve months if the effective date of the termination of the
Executive's employment with the Company under this Section 4(d) occurs at least
one year after the Executive's Date of Hire and for a period of twenty-four
months if the effective date of the termination of the Executive's employment
with the Company under this Section 4(d) occurs at least five years after the
Executive's Date of Hire; provided, however, that if, prior to the end of such
period, the Executive shall obtain employment with another employer (the
Executive being obligated to use his or her reasonable best efforts to secure
employment during such period), the amounts otherwise payable pursuant to this
clause (ii) shall be reduced by the amount of compensation earned by the
Executive from his or her new employment during such period (except that in no
event shall any such reduction result in the Executive receiving an amount
pursuant to this clause (ii) that would be less than the amount the Executive
would have earned if his Base Salary, average Bonus and other benefits had been
continued for a period of six months following such termination);
<PAGE>
(iii) the Executive shall be entitled to any amounts owing but
not yet paid pursuant to Section 3(e); and
(iv) the Executive shall be entitled to his rights to
indemnification under Section 5 hereof.
(e) Termination for Good Reason. (i) If, during the Employment
Period, the Executive terminates his employment hereunder for "Good Reason" (as
such term is defined in Section 4(e)(ii) hereof, he or she shall be entitled to
all of the payments and benefits specified by Sections 4(d)(i) through 4(d)(iv)
hereof, inclusive.
(ii) For purposes of this Agreement, "Good Reason" shall
mean, without the Executive's express written consent, the occurrence of any one
or more of the following events:
(A) a material breach of this Agreement by the Company;
(B) the failure to elect or re-elect the Executive to
any position that is at least substantially comparable or more
favorable to the positions described in Section 2 hereof, removal of
the Executive from any such position or any change in the Executive's
responsibilities described in Section 2 in any respect which is
materially adverse to the Executive;
(C) a diminution of any of the Executive's significant
duties or the assignment to the Executive of any duties inconsistent
with his duties or the material impairment of the Executive's ability
to function in the positions described in Section 2 hereof, in each
case only after the Company shall have had an opportunity to cure (any
such cure to be effected within 30 days after appropriate written
notice of the basis for Good Reason is given to the Company by the
Executive);
(D) a material reduction of any benefit enjoyed by the
Executive or the failure to continue the Executive's participation in
any incentive compensation plan, unless a plan providing a
substantially similar economic opportunity is substituted or all senior
executives suffer a substantially similar reduction or failure;
(E) the relocation of the Executive's office to a
location more than 50 miles from Mansfield, Massachusetts; or
(F) the failure of the Company to obtain the assumption
in writing of its obligation to perform this Agreement by any successor
to all or substantially all of the assets of the Company within 15 days
after a merger, consolidation, sale of assets or similar transaction.
(f) Voluntary Termination. If, during the Employment Period, the
Executive voluntarily terminates his employment hereunder for any reason other
than Good Reason, he shall be entitled to the payments specified by Sections
4(c)(iv)(A) through 4(c)(iv)(C) hereof, inclusive.
5. Indemnification. To the fullest extent permitted by law, the
Certificate of Incorporation of the Company, the By-laws of the Company or any
indemnification agreement entered into between the Company and the Executive,
the Executive (and his heirs, executors and administrators) shall be indemnified
by the Company and its successors and assigns. The obligations of the Company
pursuant to this Section 5 shall survive the termination of the Employment
Period, except as otherwise provided herein.
<PAGE>
6. Non-Competition. For a period of three years following termination
of the Executive's employment with the Company for any reason except as set
forth below, the Executive agrees that he will not accept or continue to hold
any position in any capacity, whether as an employee, agent, consultant,
investor, director or otherwise, with any person, firm or corporation, whose
present or planned business is competitive with the business of the Company as
it exists on the date of the termination of the Executive's employment with the
Company. In the event the Executive's employment with the Company is terminated
by the Company without Cause or by the Executive for Good Reason, the foregoing
non-competition covenant shall apply for two years following the date of the
termination of the Executive's employment with the Company. The foregoing
non-competition covenant shall not apply to the Executive in any given instance
if the Board waives said covenant in writing with respect to that instance.
Ownership by the Executive of less than one percent (1%) of the outstanding
stock or securities in any business enterprise shall not itself be deemed to be
engaging in any activity prohibited by this Section 6.
7. Trade Secrets. If the Executive has not already done so, the
Executive agrees to execute and abide by the Company's standard form of
agreement presently in effect protecting the Company's inventions, patents and
proprietary and confidential information and the Executive agrees to execute and
abide by any subsequent agreement generally in effect for the Company's officers
and key employees.
8. Insurance. The Company may, at its election and for its benefit,
insure the Executive against disability, accidental loss or death and the
Executive shall submit to such physical examinations and supply such information
as may be required in connection therewith.
9. Assignment. The rights and benefits of the Executive hereunder
shall not be assignable, whether by voluntary or involuntary assignment or
transfer. This Agreement shall be binding upon, and inure to the benefit
of, the successors and assigns of the Company, and the heirs, executors and
administrators of the Executive, and shall be assignable by the Company to any
entity acquiring substantially all of the assets of the Company, whether by
merger, consolidation, sale of assets or similar transaction.
10. Notices. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and personally delivered, sent by
certified or registered mail or sent by overnight courier service as follows: if
to the Executive, to his address as set forth in the records of the Company, and
if to the Company, to the address of its principal executive offices, attention:
President, with a copy to William Williams II, Esquire, Palmer & Dodge LLP, One
Beacon Street, Boston, MA 02108, or to any other address designated by any party
hereto by notice similarly given.
11. Waiver of Breach. A waiver by the Company or the Executive of any
breach of any provision of this Agreement by the other party shall not operate
or be construed as a waiver of any other or subsequent breach by the other
party.
12. Entire Agreement. This Agreement contains the entire agreement of
the parties with respect to the subject matter hereof. This Agreement may be
modified only by an agreement in writing signed by the parties hereto.
<PAGE>
13. Severability. In case any one or more of the provisions contained
in this Agreement shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Agreement, but this Agreement shall
be construed as if such invalid, illegal or unenforceable provision had never
been contained herein. If, moreover, any one or more of the provisions contained
in this Agreement shall for any reason be held to be excessively broad as to
time, duration, geographical scope, activity or subject, it shall be construed,
by limiting and reducing it, so as to be enforceable to the extent compatible
with the applicable law as it shall then appear.
14. Costs. In the event that a dispute shall arise between the parties
hereto with respect to any term or provision of this Agreement or the subject
matter hereof, all costs and expenses (including attorney fees incurred by the
Company or the Executive associated with such dispute) shall be borne by the
respective party incurring such costs and expenses; provided, however, that if
such dispute is ultimately determined in favor of Executive by a court of
competent jurisdictions, then the Company shall be required to reimburse the
Executive for up to an aggregate $100,000 of such costs and expenses actually
incurred by the Executive in connection with such dispute.
15. Interpretation; Applicable Law. This Agreement and its terms are
subject to reasonable interpretation by the Compensation Committee in its sole
discretion. The terms of this Agreement shall be governed by and construed in
accordance with the internal laws (as opposed to the conflict of laws
provisions) of the Commonwealth of Massachusetts.
16. Complete Agreement. This Agreement supersedes all other prior
agreements between the Executive and the Company concerning the Executive's
employment with the Company, and none of such agreements shall be of any force
or effect whatsoever; provided, however, that nothing contained herein shall be
deemed to limit or otherwise affect the provisions of any non-competition
agreement or code of conduct arrangement between the Executive and the Company
or the provisions of any other agreement, arrangement or policy concerning the
Executive and the Company that is unrelated to the subject matter of this
Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
HELIX TECHNOLOGY CORPORATION
By:/s/ Robert J. Lepofsky
----------------------------
President
EXECUTIVE:
/s/ Michael El-Hillow
----------------------------
Michael El-Hillow
Exhibit 10.15 EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated as of August 18, 1997 between Christopher Moody
(the "Executive") and Helix Technology Corporation, a Delaware corporation (the
"Company").
WHEREAS, the Company is engaged primarily in the business of providing
cryogenic and vacuum equipment and services principally to semiconductor
equipment manufacturers;
WHEREAS, the Executive currently serves as a Senior Vice President of the
Company;
WHEREAS, the Executive's abilities and services are unique and essential to
the prospects of the Company; and
WHEREAS, the Company and the Executive desire to enter into this Agreement
to provide for the continued employment of the Executive by the Company upon the
terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein, the parties hereby agree as follows:
1. Employment; Term.
(a) Employment. The Company hereby employs the Executive, and the
Executive hereby agrees to be employed by the Company, upon the terms and
subject to the conditions contained in this Agreement.
(b) Term. The term of this Agreement (the "Term") shall commence
on the date hereof and shall continue indefinitely thereafter until terminated
pursuant to Section 4 hereof. As used herein, the term "Employment Period" shall
mean the period commencing on the date hereof and ending on the date of
termination of Executive's employment with the Company pursuant to Section 4
hereof. For purposes of Section 4(d)(ii) the Executive's "Date of Hire" shall be
defined to be August 18, 1997.
2. Position; Duties; Responsibilities.
(a) Position and Duties. The Company shall employ the Executive as
a Senior Vice President of the Company. The Executive shall faithfully and
loyally perform to the best of his abilities all the duties reasonably assigned
to him hereunder, shall devote his full time, attention and effort to the
affairs of the Company as is reasonably necessary for the proper performance of
such duties and shall use his reasonable best efforts to promote the interests
of the Company. Any other commitments or activities which might impinge on the
Executive's full-time performance of such duties shall be reported to and
approved by the Chairman of the Board of Directors of the Company (the "Board")
and the President of the Company.
(b) Responsibilities. The Executive shall have responsibility and
authority for the formulation and execution of the policies relating to the
sales and marketing operations of the Company and the administration of
marketing, sales and customer service matters and such other responsibilities
and authorities as are customarily exercisable by a head of sales and marketing,
subject in each case to the general supervision and direction of the Board, the
Chairman of the Board and the President of the Company.
<PAGE>
3. Compensation.
(a) Base Salary. During the Employment Period, the Company shall
pay to the Executive an annual base salary at the rate of $160,000 per annum,
payable in accordance with the Company's executive payroll policy. Such base
salary shall be reviewed annually, commencing January 1, 1998, and may be
increased (but shall not be decreased except in conjunction with a general
reduction of executive salaries), as determined by the Company's Human Resources
and Compensation Committee (the "Compensation Committee"). The Executive's base
salary, as increased or decreased hereunder, is referred to herein as the "Base
Salary."
(b) Annual Performance Bonus. In the discretion of the Company's
Compensation Committee, the Executive shall be eligible to receive an annual
performance bonus payable in cash for each full or partial fiscal year of the
Company during the Employment Period in accordance with the Company's
performance-based bonus program for Executive Officers.
(c) Stock Options. In the discretion of the Company's Compensation
Committee, the Executive shall be eligible to receive from time to time during
the Employment Period options to purchase shares of Company common stock
("Common Stock") pursuant to the terms of the Company's 1996 Equity Incentive
Plan.
(d) Supplemental Key Executive Retirement Plan. In addition to the
compensation and benefits to which the Executive is entitled hereunder, the
Executive shall be entitled to participate in the Company's Supplemental Key
Executive Retirement Plan (the "Supplemental Retirement Plan") in accordance
with its terms.
(e) Reimbursement of Expenses. The Company shall reimburse the
Executive for all expenses necessarily and reasonably incurred by him during the
Employment Period in connection with the business of the Company, upon
presentation of proper receipts or other proof of expenditure and subject to
such reasonable guidelines or limitations as are established by the Company from
time to time.
(f) Participation in Benefit Plans. During the Employment Period,
the Executive shall be entitled to participate in any profit sharing plan,
retirement plan, group life insurance plan or other insurance plan or medical
expense plan maintained by the Company for its senior executives generally.
4. Termination.
(a) Death. Upon the death of the Executive, this Agreement shall
automatically terminate and all rights of the Executive and his heirs, executors
and administrators to compensation and other benefits hereunder shall cease,
except for (i) compensation which shall have accrued to the date of death,
including accrued Base Salary up to the date of termination, prorated Bonus
(based on the same percentage of accrued Base Salary as compared to annual Base
Salary multiplied times the average of the annual Bonuses paid to the Executive
for the three fiscal years of the Company preceding the Executive's death) and
any amounts payable pursuant to the Supplemental Retirement Plan and (ii) the
rights to indemnification under Section 5 hereof.
<PAGE>
(b) Disability. The Company may, at its option, terminate this
Agreement upon written notice to the Executive if the Executive, because of
physical or mental incapacity or disability, fails in any material respect to
perform the services required of him hereunder for a continuous period of 180
days. Upon such termination, all obligations of the Company hereunder shall
cease, except for (i) compensation which shall have accrued to the date of
termination, including accrued Base Salary up to the date of termination,
prorated Bonus (based on the same percentage of accrued Base Salary as compared
to annual Base Salary multiplied times the average of the annual Bonuses paid to
the Executive for the three fiscal years of the Company preceding the
termination of this Agreement pursuant to this Section 4(b)) and any amounts
payable pursuant to the Supplemental Retirement Plan, and (ii) the rights to
indemnification under Section 5 hereof. In the event of any dispute regarding
the existence of the Executive's incapacity hereunder, the matter shall be
resolved by the determination of a majority of three physicians qualified to
practice medicine in the state of the Executive's residence, one to be selected
by each of the Executive and the Board and the third to be selected by such two
designated physicians. For this purpose, the Executive shall submit to
appropriate medical examinations.
(c) Cause. (i) The Company may, at its option, terminate the
Executive's employment under this Agreement for "Cause" (as hereinafter
defined). A termination for Cause shall not take effect until and unless the
Company complies with this Section 4(c)(i). The Executive shall be given written
notice by the Company of the intention to terminate his employment hereunder for
Cause (the "Cause Notice"). The Cause Notice shall state the particular
action(s) or inaction(s) giving rise to termination for Cause.
(ii) As used in this Agreement, the term "Cause" shall mean
any one or more of the following, in any case as determined to have occurred by
not less than two-thirds of the directors then serving on the Board:
(A) the Executive's refusal to perform specific
directives of the Board which are consistent with the scope and nature
of the Executive's duties and responsibilities as set forth herein or a
material violation by Executive of the policies, procedures or rules of
the Company;
(B) the Executive's commission of, or conviction for, a
felony or any act involving fraud, embezzlement, theft,
misrepresentation, dishonesty or moral turpitude;
(C) the Executive's indictment for commission of a
material crime on the basis of alleged facts of such a serious nature
that the Company has reasonable cause to believe that the Executive
cannot effectively discharge the Executive's duties and
responsibilities, or the Executive's indictment for the commission of a
material business related crime;
(D) any gross or willful misconduct of the Executive
resulting in substantial loss to the Company or substantial damage to
the Company's business or reputation;
(E) gross neglect of the Executive's duties resulting
in substantial loss to the Company or substantial damage to the
Company's business or reputation; or
(F) any material breach by the Executive of this
Agreement or any non-competition agreement between the Executive
and the Company.
<PAGE>
(iii) The exercise of the right of the Company to terminate
this Agreement pursuant to this Section 4(c) shall not abrogate the rights or
remedies of the Company in respect of the breach giving rise to such
termination.
(iv) If the Company terminates the Executive's employment for
Cause, he shall be entitled to:
(A) accrued Base Salary through the date of the
termination of his employment;
(B) any amount owing but not yet paid pursuant to
Section 3(e); and
(C) other or additional benefits to the extent required
by any applicable plans and programs of the Company.
(v) Notwithstanding anything to the contrary contained in this
Agreement, if, following a termination of the Executive's employment for Cause,
a court of competent jurisdiction, in a final determination, determines that the
Executive was not guilty of the conduct that formed the basis for the
termination, the Executive shall be entitled to the payments and the economic
equivalent of the benefits he would have received had his employment been
terminated by the Company without Cause.
(d) Termination Without Cause. If, during the Employment Period,
the Company terminates the employment of the Executive hereunder for any reason
other than a reason set forth in Section 4(a), 4(b) or 4(c):
(i) concurrent with such termination, the Company shall pay to
the Executive an amount equal to his accrued Base Salary up to the date of
termination, prorated Bonus (based on the same percentage of accrued Base Salary
as compared to the annual Base Salary multiplied times the average of the annual
Bonuses paid to the Executive for the three fiscal years of the Company
preceding such termination of employment) and any amounts payable pursuant to
the Supplemental Retirement Plan, in each case accrued through the date of
termination;
(ii) the Company shall continue to pay the Executive his Base
Salary, average Bonus (based on the average of the annual Bonuses paid to the
Executive for the three fiscal years of the Company preceding such termination
of employment divided by the applicable pay period (said Base Salary and average
bonus being payable pro-rata to the Executive on the Company's usual payroll
dates)) and all other benefits which would otherwise be payable hereunder for a
period of twelve months if the effective date of the termination of the
Executive's employment with the Company under this Section 4(d) occurs at least
one year after the Executive's Date of Hire and for a period of twenty-four
months if the effective date of the termination of the Executive's employment
with the Company under this Section 4(d) occurs at least five years after the
Executive's Date of Hire; provided, however, that if, prior to the end of such
period, the Executive shall obtain employment with another employer (the
Executive being obligated to use his or her reasonable best efforts to secure
employment during such period), the amounts otherwise payable pursuant to this
clause (ii) shall be reduced by the amount of compensation earned by the
Executive from his or her new employment during such period (except that in no
event shall any such reduction result in the Executive receiving an amount
pursuant to this clause (ii) that would be less than the amount the Executive
would have earned if his Base Salary, average Bonus and other benefits had been
continued for a period of six months following such termination);
<PAGE>
(iii) the Executive shall be entitled to any amounts owing but
not yet paid pursuant to Section 3(e); and
(iv) the Executive shall be entitled to his rights to
indemnification under Section 5 hereof.
(e) Termination for Good Reason. (i) If, during the Employment
Period, the Executive terminates his employment hereunder for "Good Reason" (as
such term is defined in Section 4(e)(ii) hereof, he or she shall be entitled to
all of the payments and benefits specified by Sections 4(d)(i) through 4(d)(iv)
hereof, inclusive.
(ii) For purposes of this Agreement, "Good Reason" shall
mean, without the Executive's express written consent, the occurrence of any one
or more of the following events:
(A) a material breach of this Agreement by the Company;
(B) the failure to elect or re-elect the Executive to
any position that is at least substantially comparable or more
favorable to the positions described in Section 2 hereof, removal of
the Executive from any such position or any change in the Executive's
responsibilities described in Section 2 in any respect which is
materially adverse to the Executive;
(C) a diminution of any of the Executive's significant
duties or the assignment to the Executive of any duties inconsistent
with his duties or the material impairment of the Executive's ability
to function in the positions described in Section 2 hereof, in each
case only after the Company shall have had an opportunity to cure (any
such cure to be effected within 30 days after appropriate written
notice of the basis for Good Reason is given to the Company by the
Executive);
(D) a material reduction of any benefit enjoyed by the
Executive or the failure to continue the Executive's participation in
any incentive compensation plan, unless a plan providing a
substantially similar economic opportunity is substituted or all senior
executives suffer a substantially similar reduction or failure;
(E) the relocation of the Executive's office to a
location more than 50 miles from Mansfield, Massachusetts; or
(F) the failure of the Company to obtain the assumption
in writing of its obligation to perform this Agreement by any successor
to all or substantially all of the assets of the Company within 15 days
after a merger, consolidation, sale of assets or similar transaction.
(f) Voluntary Termination. If, during the Employment Period, the
Executive voluntarily terminates his employment hereunder for any reason other
than Good Reason, he shall be entitled to the payments specified by Sections
4(c)(iv)(A) through 4(c)(iv)(C) hereof, inclusive.
5. Indemnification. To the fullest extent permitted by law, the
Certificate of Incorporation of the Company, the By-laws of the Company or any
indemnification agreement entered into between the Company and the Executive,
the Executive (and his heirs, executors and administrators) shall be indemnified
by the Company and its successors and assigns. The obligations of the Company
pursuant to this Section 5 shall survive the termination of the Employment
Period, except as otherwise provided herein.
<PAGE>
6. Non-Competition. For a period of three years following termination
of the Executive's employment with the Company for any reason except as set
forth below, the Executive agrees that he will not accept or continue to hold
any position in any capacity, whether as an employee, agent, consultant,
investor, director or otherwise, with any person, firm or corporation, whose
present or planned business is competitive with the business of the Company as
it exists on the date of the termination of the Executive's employment with the
Company. In the event the Executive's employment with the Company is terminated
by the Company without Cause or by the Executive for Good Reason, the foregoing
non-competition covenant shall apply for two years following the date of the
termination of the Executive's employment with the Company. The foregoing
non-competition covenant shall not apply to the Executive in any given instance
if the Board waives said covenant in writing with respect to that instance.
Ownership by the Executive of less than one percent (1%) of the outstanding
stock or securities in any business enterprise shall not itself be deemed to be
engaging in any activity prohibited by this Section 6.
7. Trade Secrets. If the Executive has not already done so, the
Executive agrees to execute and abide by the Company's standard form of
agreement presently in effect protecting the Company's inventions, patents and
proprietary and confidential information and the Executive agrees to execute and
abide by any subsequent agreement generally in effect for the Company's officers
and key employees.
8. Insurance. The Company may, at its election and for its benefit,
insure the Executive against disability, accidental loss or death and the
Executive shall submit to such physical examinations and supply such information
as may be required in connection therewith.
9. Assignment. The rights and benefits of the Executive hereunder
shall not be assignable, whether by voluntary or involuntary assignment or
transfer. This Agreement shall be binding upon, and inure to the benefit of,
the successors and assigns of the Company, and the heirs, executors and
administrators of the Executive, and shall be assignable by the Company to any
entity acquiring substantially all of the assets of the Company, whether by
merger, consolidation, sale of assets or similar transaction.
10. Notices. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and personally delivered, sent by
certified or registered mail or sent by overnight courier service as follows: if
to the Executive, to his address as set forth in the records of the Company, and
if to the Company, to the address of its principal executive offices, attention:
President, with a copy to William Williams II, Esquire, Palmer & Dodge LLP, One
Beacon Street, Boston, MA 02108, or to any other address designated by any party
hereto by notice similarly given.
11. Waiver of Breach. A waiver by the Company or the Executive of any
breach of any provision of this Agreement by the other party shall not operate
or be construed as a waiver of any other or subsequent breach by the other
party.
12. Entire Agreement. This Agreement contains the entire agreement of
the parties with respect to the subject matter hereof. This Agreement may be
modified only by an agreement in writing signed by the parties hereto.
<PAGE>
13. Severability. In case any one or more of the provisions contained
in this Agreement shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Agreement, but this Agreement shall
be construed as if such invalid, illegal or unenforceable provision had never
been contained herein. If, moreover, any one or more of the provisions contained
in this Agreement shall for any reason be held to be excessively broad as to
time, duration, geographical scope, activity or subject, it shall be construed,
by limiting and reducing it, so as to be enforceable to the extent compatible
with the applicable law as it shall then appear.
14. Costs. In the event that a dispute shall arise between the parties
hereto with respect to any term or provision of this Agreement or the subject
matter hereof, all costs and expenses (including attorney fees incurred by the
Company or the Executive associated with such dispute) shall be borne by the
respective party incurring such costs and expenses; provided, however, that if
such dispute is ultimately determined in favor of Executive by a court of
competent jurisdictions, then the Company shall be required to reimburse the
Executive for up to an aggregate $100,000 of such costs and expenses actually
incurred by the Executive in connection with such dispute.
15. Interpretation; Applicable Law. This Agreement and its terms are
subject to reasonable interpretation by the Compensation Committee in its sole
discretion. The terms of this Agreement shall be governed by and construed in
accordance with the internal laws (as opposed to the conflict of laws
provisions) of the Commonwealth of Massachusetts.
16. Complete Agreement. This Agreement supersedes all other prior
agreements between the Executive and the Company concerning the Executive's
employment with the Company, and none of such agreements shall be of any force
or effect whatsoever; provided, however, that nothing contained herein shall be
deemed to limit or otherwise affect the provisions of any non-competition
agreement or code of conduct arrangement between the Executive and the Company
or the provisions of any other agreement, arrangement or policy concerning the
Executive and the Company that is unrelated to the subject matter of this
Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
HELIX TECHNOLOGY CORPORATION
By:/s/ Robert J. Lepofsky
----------------------------
President
EXECUTIVE:
/s/ Christopher Moody
----------------------------
Christopher Moody
Exhibit 10.16 EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated as of July 18, 1997 between Richard J. Paynting
(the "Executive") and Helix Technology Corporation, a Delaware corporation (the
"Company").
WHEREAS, the Company is engaged primarily in the business of providing
cryogenic and vacuum equipment and services principally to semiconductor
equipment manufacturers;
WHEREAS, the Executive currently serves as a Senior Vice President of the
Company;
WHEREAS, the Executive's abilities and services are unique and essential to
the prospects of the Company; and
WHEREAS, the Company and the Executive desire to enter into this Agreement
to provide for the continued employment of the Executive by the Company upon the
terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein, the parties hereby agree as follows:
1. Employment; Term.
(a) Employment. The Company hereby employs the Executive, and the
Executive hereby agrees to be employed by the Company, upon the terms and
subject to the conditions contained in this Agreement.
(b) Term. The term of this Agreement (the "Term") shall commence
on the date hereof and shall continue indefinitely thereafter until terminated
pursuant to Section 4 hereof. As used herein, the term "Employment Period" shall
mean the period commencing on the date hereof and ending on the date of
termination of Executive's employment with the Company pursuant to Section 4
hereof. For purposes of Section 4(d)(ii) the Executive's "Date of Hire" shall be
defined to be August 5, 1996.
2. Position; Duties; Responsibilities.
(a) Position and Duties. The Company shall employ the Executive as
a Senior Vice President of the Company. The Executive shall faithfully and
loyally perform to the best of his abilities all the duties reasonably assigned
to him hereunder, shall devote his full time, attention and effort to the
affairs of the Company as is reasonably necessary for the proper performance of
such duties and shall use his reasonable best efforts to promote the interests
of the Company. Any other commitments or activities which might impinge on the
Executive's full-time performance of such duties shall be reported to and
approved by the Chairman of the Board of Directors of the Company (the "Board")
and the President of the Company.
<PAGE>
(b) Responsibilities. The Executive shall have responsibility and
authority for the formulation and execution of the policies relating to the
research and development functions of the Company and the administration of its
research and development department and such other responsibilities and
authorities as are customarily exercisable by a head of research and
development, subject in each case to the general supervision and direction of
the Board, the Chairman of the Board and the President of the Company.
3. Compensation.
(a) Base Salary. During the Employment Period, the Company shall
pay to the Executive an annual base salary at the rate of $170,000 per annum,
payable in accordance with the Company's executive payroll policy. Such base
salary shall be reviewed annually, commencing January 1, 1998, and may be
increased (but shall not be decreased except in conjunction with a general
reduction of executive salaries), as determined by the Company's Human Resources
and Compensation Committee (the "Compensation Committee"). The Executive's base
salary, as increased or decreased hereunder, is referred to herein as the "Base
Salary."
(b) Annual Performance Bonus. In the discretion of the Company's
Compensation Committee, the Executive shall be eligible to receive an annual
performance bonus payable in cash for each full or partial fiscal year of the
Company during the Employment Period in accordance with the Company's
performance-based bonus program for Executive Officers.
(c) Stock Options. In the discretion of the Company's Compensation
Committee, the Executive shall be eligible to receive from time to time during
the Employment Period options to purchase shares of Company common stock
("Common Stock") pursuant to the terms of the Company's 1996 Equity Incentive
Plan.
(d) Supplemental Key Executive Retirement Plan. In addition to the
compensation and benefits to which the Executive is entitled hereunder, the
Executive shall be entitled to participate in the Company's Supplemental Key
Executive Retirement Plan (the "Supplemental Retirement Plan") in accordance
with its terms.
(e) Reimbursement of Expenses. The Company shall reimburse the
Executive for all expenses necessarily and reasonably incurred by him during the
Employment Period in connection with the business of the Company, upon
presentation of proper receipts or other proof of expenditure and subject to
such reasonable guidelines or limitations as are established by the Company from
time to time.
(f) Participation in Benefit Plans. During the Employment Period,
the Executive shall be entitled to participate in any profit sharing plan,
retirement plan, group life insurance plan or other insurance plan or medical
expense plan maintained by the Company for its senior executives generally.
<PAGE>
4. Termination.
(a) Death. Upon the death of the Executive, this Agreement shall
automatically terminate and all rights of the Executive and his heirs, executors
and administrators to compensation and other benefits hereunder shall cease,
except for (i) compensation which shall have accrued to the date of death,
including accrued Base Salary up to the date of termination, prorated Bonus
(based on the same percentage of accrued Base Salary as compared to annual Base
Salary multiplied times the average of the annual Bonuses paid to the Executive
for the three fiscal years of the Company preceding the Executive's death) and
any amounts payable pursuant to the Supplemental Retirement Plan and (ii) the
rights to indemnification under Section 5 hereof.
(b) Disability. The Company may, at its option, terminate this
Agreement upon written notice to the Executive if the Executive, because of
physical or mental incapacity or disability, fails in any material respect to
perform the services required of him hereunder for a continuous period of 180
days. Upon such termination, all obligations of the Company hereunder shall
cease, except for (i) compensation which shall have accrued to the date of
termination, including accrued Base Salary up to the date of termination,
prorated Bonus (based on the same percentage of accrued Base Salary as compared
to annual Base Salary multiplied times the average of the annual Bonuses paid to
the Executive for the three fiscal years of the Company preceding the
termination of this Agreement pursuant to this Section 4(b)) and any amounts
payable pursuant to the Supplemental Retirement Plan, and (ii) the rights to
indemnification under Section 5 hereof. In the event of any dispute regarding
the existence of the Executive's incapacity hereunder, the matter shall be
resolved by the determination of a majority of three physicians qualified to
practice medicine in the state of the Executive's residence, one to be selected
by each of the Executive and the Board and the third to be selected by such two
designated physicians. For this purpose, the Executive shall submit to
appropriate medical examinations.
(c) Cause. (i) The Company may, at its option, terminate the
Executive's employment under this Agreement for "Cause" (as hereinafter
defined). A termination for Cause shall not take effect until and unless the
Company complies with this Section 4(c)(i). The Executive shall be given written
notice by the Company of the intention to terminate his employment hereunder for
Cause (the "Cause Notice"). The Cause Notice shall state the particular
action(s) or inaction(s) giving rise to termination for Cause.
(ii) As used in this Agreement, the term "Cause" shall mean
any one or more of the following, in any case as determined to have occurred by
not less than two-thirds of the directors then serving on the Board:
(A) the Executive's refusal to perform specific
directives of the Board which are consistent with the scope and nature
of the Executive's duties and responsibilities as set forth herein or a
material violation by Executive of the policies, procedures or rules of
the Company;
(B) the Executive's commission of, or conviction for, a
felony or any act involving fraud, embezzlement, theft,
misrepresentation, dishonesty or moral turpitude;
(C) the Executive's indictment for commission of a
material crime on the basis of alleged facts of such a serious nature
that the Company has reasonable cause to believe that the Executive
cannot effectively discharge the Executive's duties and
responsibilities, or the Executive's indictment for the commission of a
material business related crime;
<PAGE>
(D) any gross or willful misconduct of the Executive
resulting in substantial loss to the Company or substantial damage to
the Company's business or reputation;
(E) gross neglect of the Executive's duties resulting
in substantial loss to the Company or substantial damage to the
Company's business or reputation; or
(F) any material breach by the Executive of this
Agreement or any non-competition agreement between the Executive
and the Company.
(iii) The exercise of the right of the Company to terminate
this Agreement pursuant to this Section 4(c) shall not abrogate the rights or
remedies of the Company in respect of the breach giving rise to such
termination.
(iv) If the Company terminates the Executive's employment for
Cause, he shall be entitled to:
(A) accrued Base Salary through the date of the
termination of his employment;
(B) any amounts owing but not yet paid pursuant to
Section 3(e); and
(C) other or additional benefits to the extent required
by any applicable plans and programs of the Company.
(v) Notwithstanding anything to the contrary contained in this
Agreement, if, following a termination of the Executive's employment for Cause,
a court of competent jurisdiction, in a final determination, determines that the
Executive was not guilty of the conduct that formed the basis for the
termination, the Executive shall be entitled to the payments and the economic
equivalent of the benefits he would have received had his employment been
terminated by the Company without Cause.
(d) Termination Without Cause. If, during the Employment Period,
the Company terminates the employment of the Executive hereunder for any reason
other than a reason set forth in Section 4(a), 4(b) or 4(c):
(i) concurrent with such termination, the Company shall pay to
the Executive an amount equal to his accrued Base Salary up to the date of
termination, prorated Bonus (based on the same percentage of accrued Base Salary
as compared to the annual Base Salary multiplied times the average of the annual
Bonuses paid to the Executive for the three fiscal years of the Company
preceding such termination of employment) and any amounts payable pursuant to
the Supplemental Retirement Plan, in each case accrued through the date of
termination;
<PAGE>
(ii) the Company shall continue to pay the Executive his Base
Salary, average Bonus (based on the average of the annual Bonuses paid to the
Executive for the three fiscal years of the Company preceding such termination
of employment divided by the applicable pay period (said Base Salary and average
bonus being payable pro-rata to the Executive on the Company's usual payroll
dates)) and all other benefits which would otherwise be payable hereunder for a
period of twelve months if the effective date of the termination of the
Executive's employment with the Company under this Section 4(d) occurs at least
one year after the Executive's Date of Hire and for a period of twenty-four
months if the effective date of the termination of the Executive's employment
with the Company under this Section 4(d) occurs at least five years after the
Executive's Date of Hire; provided, however, that if, prior to the end of such
period, the Executive shall obtain employment with another employer (the
Executive being obligated to use his or her reasonable best efforts to secure
employment during such period), the amounts otherwise payable pursuant to this
clause (ii) shall be reduced by the amount of compensation earned by the
Executive from his or her new employment during such period (except that in no
event shall any such reduction result in the Executive receiving an amount
pursuant to this clause (ii) that would be less than the amount the Executive
would have earned if his Base Salary, average Bonus and other benefits had been
continued for a period of six months following such termination);
(iii) the Executive shall be entitled to any amounts owing but
not yet paid pursuant to Section 3(e); and
(iv) the Executive shall be entitled to his rights to
indemnification under Section 5 hereof.
(e) Termination for Good Reason. (i) If, during the Employment
Period, the Executive terminates his employment hereunder for "Good Reason" (as
such term is defined in Section 4(e)(ii) hereof, he or she shall be entitled to
all of the payments and benefits specified by Sections 4(d)(i) through 4(d)(iv)
hereof, inclusive.
(ii) For purposes of this Agreement, "Good Reason" shall
mean, without the Executive's express written consent, the occurrence of any one
or more of the following events:
(A) a material breach of this Agreement by the Company;
(B) the failure to elect or re-elect the Executive to
any position that is at least substantially comparable or more
favorable to the positions described in Section 2 hereof, removal of
the Executive from any such position or any change in the Executive's
responsibilities described in Section 2 in any respect which is
materially adverse to the Executive;
(C) a diminution of any of the Executive's significant
duties or the assignment to the Executive of any duties inconsistent
with his duties or the material impairment of the Executive's ability
to function in the positions described in Section 2 hereof, in each
case only after the Company shall have had an opportunity to cure (any
such cure to be effected within 30 days after appropriate written
notice of the basis for Good Reason is given to the Company by the
Executive);
(D) a material reduction of any benefit enjoyed by the
Executive or the failure to continue the Executive's participation in
any incentive compensation plan, unless a plan providing a
substantially similar economic opportunity is substituted or all senior
executives suffer a substantially similar reduction or failure;
<PAGE>
(E) the relocation of the Executive's office to a
location more than 50 miles from Mansfield, Massachusetts; or
(F) the failure of the Company to obtain the assumption
in writing of its obligation to perform this Agreement by any successor
to all or substantially all of the assets of the Company within 15 days
after a merger, consolidation, sale of assets or similar transaction.
(f) Voluntary Termination. If, during the Employment Period, the
Executive voluntarily terminates his employment hereunder for any reason other
than Good Reason, he shall be entitled to the payments specified by Sections
4(c)(iv)(A) through 4(c)(iv)(C) hereof, inclusive.
5. Indemnification. To the fullest extent permitted by law, the
Certificate of Incorporation of the Company, the By-laws of the Company or any
indemnification agreement entered into between the Company and the Executive,
the Executive (and his heirs, executors and administrators) shall be indemnified
by the Company and its successors and assigns. The obligations of the Company
pursuant to this Section 5 shall survive the termination of the Employment
Period, except as otherwise provided herein.
6. Non-Competition. For a period of three years following termination
of the Executive's employment with the Company for any reason except as set
forth below, the Executive agrees that he will not accept or continue to hold
any position in any capacity, whether as an employee, agent, consultant,
investor, director or otherwise, with any person, firm or corporation, whose
present or planned business is competitive with the business of the Company as
it exists on the date of the termination of the Executive's employment with the
Company. In the event the Executive's employment with the Company is terminated
by the Company without Cause or by the Executive for Good Reason, the foregoing
non-competition covenant shall apply for two years following the date of the
termination of the Executive's employment with the Company. The foregoing
non-competition covenant shall not apply to the Executive in any given instance
if the Board waives said covenant in writing with respect to that instance.
Ownership by the Executive of less than one percent (1%) of the outstanding
stock or securities in any business enterprise shall not itself be deemed to be
engaging in any activity prohibited by this Section 6.
7. Trade Secrets. If the Executive has not already done so, the
Executive agrees to execute and abide by the Company's standard form of
agreement presently in effect protecting the Company's inventions, patents and
proprietary and confidential information and the Executive agrees to execute and
abide by any subsequent agreement generally in effect for the Company's officers
and key employees.
8. Insurance. The Company may, at its election and for its benefit,
insure the Executive against disability, accidental loss or death and the
Executive shall submit to such physical examinations and supply such information
as may be required in connection therewith.
9. Assignment. The rights and benefits of the Executive hereunder
shall not be assignable, whether by voluntary or involuntary assignment or
transfer. This Agreement shall be binding upon, and inure to the benefit
of, the successors and assigns of the Company, and the heirs, executors and
administrators of the Executive, and shall be assignable by the Company to any
entity acquiring substantially all of the assets of the Company, whether by
merger, consolidation, sale of assets or similar transaction.
<PAGE>
10. Notices. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and personally delivered, sent by
certified or registered mail or sent by overnight courier service as follows: if
to the Executive, to his address as set forth in the records of the Company, and
if to the Company, to the address of its principal executive offices, attention:
President, with a copy to William Williams II, Esquire, Palmer & Dodge LLP, One
Beacon Street, Boston, MA 02108, or to any other address designated by any party
hereto by notice similarly given.
11. Waiver of Breach. A waiver by the Company or the Executive of any
breach of any provision of this Agreement by the other party shall not operate
or be construed as a waiver of any other or subsequent breach by the other
party.
12. Entire Agreement. This Agreement contains the entire agreement of
the parties with respect to the subject matter hereof. This Agreement may be
modified only by an agreement in writing signed by the parties hereto.
13. Severability. In case any one or more of the provisions contained
in this Agreement shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Agreement, but this Agreement shall
be construed as if such invalid, illegal or unenforceable provision had never
been contained herein. If, moreover, any one or more of the provisions contained
in this Agreement shall for any reason be held to be excessively broad as to
time, duration, geographical scope, activity or subject, it shall be construed,
by limiting and reducing it, so as to be enforceable to the extent compatible
with the applicable law as it shall then appear.
14. Costs. In the event that a dispute shall arise between the parties
hereto with respect to any term or provision of this Agreement or the subject
matter hereof, all costs and expenses (including attorney fees incurred by the
Company or the Executive associated with such dispute) shall be borne by the
respective party incurring such costs and expenses; provided, however, that if
such dispute is ultimately determined in favor of Executive by a court of
competent jurisdictions, then the Company shall be required to reimburse the
Executive for up to an aggregate $100,000 of such costs and expenses actually
incurred by the Executive in connection with such dispute.
15. Interpretation; Applicable Law. This Agreement and its terms are
subject to reasonable interpretation by the Compensation Committee in its sole
discretion. The terms of this Agreement shall be governed by and construed in
accordance with the internal laws (as opposed to the conflict of laws
provisions) of the Commonwealth of Massachusetts.
16. Complete Agreement. This Agreement supersedes all other prior
agreements between the Executive and the Company concerning the Executive's
employment with the Company, and none of such agreements shall be of any force
or effect whatsoever; provided, however, that nothing contained herein shall be
deemed to limit or otherwise affect the provisions of any non-competition
agreement or code of conduct arrangement between the Executive and the Company
or the provisions of any other agreement, arrangement or policy concerning the
Executive and the Company that is unrelated to the subject matter of this
Agreement.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
HELIX TECHNOLOGY CORPORATION
By:/s/Robert J. Lepofsky
----------------------------
President
EXECUTIVE:
/s/ Richard J. Paynting
----------------------------
Richard J. Paynting
<TABLE>
Exhibit 11. SCHEDULE OF COMPUTATION OF INCOME PER SHARE
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
(in thousands except per share data) 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net income $21,315 $21,957 $20,985
Basic shares (1) 19,768 19,670 19,478
Add: (1) common equivalent shares representing shares issuable upon
conversion of stock options (using the treasury stock method)
Options outstanding not included in the computation of diluted
shares were 40, 60, and 0 for 1997, 1996 and 1995, respectively,
because the options' price was greater than the average market
price of the common shares. 202 308 532
Diluted shares (1) 19,970 19,978 20,010
Basic net income per share (1) $ 1.08 $ 1.12 $ 1.08
Diluted net income per share (1) $ 1.07 $ 1.10 $ 1.05
(1) All share and per share data reflect a two-for-one common stock split
effective November 1997. (Note E)
</TABLE>
Exhibit 21. Subsidiaries of the Registrant
Percentage of Voting
Subsidiary Place Organized Securities Owned
- ------------------- --------------- --------------------
Helix Securities
Corporation Massachusetts Wholly owned
CTI-Cryogenics, Inc. Barbados Wholly owned
CTI-Cryogenics Ltd. England Wholly owned
CTI-Cryogenics SA France Wholly owned
CTI-Cryogenics GmbH Germany Wholly owned
Exhibit 23. Consent of Experts and Counsel
CONSENT OF INDEPENDENT ACCOUNTANTS
To The Board Of Directors and Stockholders
of Helix Technology Corporation:
We consent to the incorporation by reference in the registration
statement of Helix Technology Corporation on Form S-8 (File No. 2-83974) of our
reports dated February 6, 1998, on our audits of the consolidated financial
statements and financial statement schedules of Helix Technology Corporation as
of December 31, 1997 and 1996, and for the years ended December 31, 1997, 1996
and 1995, which reports are included in this Annual Report on Form 10-K.
/s/ Coopers & Lybrand L.L.P.
-------------------------------
Coopers & Lybrand L.L.P.
Boston, Massachusetts
March 12, 1998
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<CASH> 33,360
<SECURITIES> 0
<RECEIVABLES> 15,521
<ALLOWANCES> (150)
<INVENTORY> 11,287
<CURRENT-ASSETS> 65,329
<PP&E> 27,094
<DEPRECIATION> (17,370)
<TOTAL-ASSETS> 81,666
<CURRENT-LIABILITIES> 14,620
<BONDS> 0
0
0
<COMMON> 19,830
<OTHER-SE> 47,216
<TOTAL-LIABILITY-AND-EQUITY> 81,666
<SALES> 131,519
<TOTAL-REVENUES> 131,519
<CGS> 69,210
<TOTAL-COSTS> 33,088
<OTHER-EXPENSES> (3,271)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 32,492
<INCOME-TAX> 11,177
<INCOME-CONTINUING> 21,315
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 21,315
<EPS-PRIMARY> 1.08
<EPS-DILUTED> 1.07
</TABLE>
