<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 27, 2000
REGISTRATION NO. 333-35478
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 2
TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
THERMO ELECTRON CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 3569 04-2209186
(STATE OR OTHER JURISDICTION (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
</TABLE>
81 WYMAN STREET
WALTHAM, MASSACHUSETTS 02454-9046
(781) 622-1000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------
SANDRA L. LAMBERT, SECRETARY
THERMO ELECTRON CORPORATION
81 WYMAN STREET
WALTHAM, MASSACHUSETTS 02454-9046
(781) 622-1000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
------------------------
COPIES TO:
<TABLE>
<S> <C>
SETH H. HOOGASIAN, ESQ. DAVID E. REDLICK, ESQ.
GENERAL COUNSEL HALE AND DORR LLP
THERMO ELECTRON CORPORATION 60 STATE STREET
81 WYMAN STREET BOSTON, MASSACHUSETTS 02109
WALTHAM, MASSACHUSETTS 02454-9046 (617) 526-6000
(781) 622-1000
</TABLE>
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As
promptly as practicable after this Registration Statement becomes effective and
the other conditions to the exchange offer are met or waived.
If the securities being registered on this form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [ ]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SECTION 8(a), MAY DETERMINE.
================================================================================
<PAGE> 2
THE INFORMATION CONTAINED IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE
CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE RELATED REGISTRATION
STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE.
THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND WE ARE NOT
SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER
OR SALE IS NOT PERMITTED.
Subject to Completion, dated June 27, 2000
THERMO ELECTRON CORPORATION
OFFER TO EXCHANGE
0.85 SHARES OF COMMON STOCK
OF
THERMO ELECTRON CORPORATION
FOR
EACH OUTSTANDING SHARE OF COMMON STOCK
OF
THERMO INSTRUMENT SYSTEMS INC.
------------------------
MERGER
OF
THERMO INSTRUMENT SYSTEMS INC.
INTO
THERMO ELECTRON CORPORATION
------------------------
THE OFFER AND WITHDRAWAL RIGHTS
WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME,
ON THURSDAY, JUNE 29, 2000, UNLESS THE OFFER IS EXTENDED.
We are offering to exchange 0.85 shares of Thermo Electron Corporation
common stock for each outstanding share of common stock of Thermo Instrument
Systems Inc. that stockholders of Thermo Instrument validly tender, and do not
properly withdraw, before the exchange offer expires. You may withdraw shares of
Thermo Instrument common stock that you tender pursuant to this exchange offer
at any time prior to the expiration of the exchange offer.
If we complete the exchange offer, we intend to cause Thermo Instrument to
merge into Thermo Electron. In the merger, we will issue 0.85 shares of Thermo
Electron common stock for each outstanding share of Thermo Instrument common
stock, subject to any applicable appraisal rights. This prospectus also relates
to the shares of our common stock that we would issue in the merger.
You should read this prospectus carefully. It sets forth the terms and
conditions of the exchange offer and the merger. It also describes our and
Thermo Instrument's businesses and finances. We have prepared this prospectus so
that you will have the information necessary to make a decision about the
exchange offer and whether to pursue your appraisal rights in connection with
the merger.
OUR OBLIGATION TO EXCHANGE THERMO ELECTRON COMMON STOCK FOR THERMO
INSTRUMENT COMMON STOCK IS SUBJECT TO THE IMPORTANT CONDITIONS LISTED BELOW
UNDER "THE EXCHANGE OFFER -- CONDITIONS OF THE OFFER." THESE INCLUDE THE
CONDITION THAT STOCKHOLDERS OF THERMO INSTRUMENT VALIDLY TENDER, AND DO NOT
WITHDRAW, A SUFFICIENT NUMBER OF SHARES OF THERMO INSTRUMENT COMMON STOCK WHICH,
TOGETHER WITH SHARES OF THERMO INSTRUMENT COMMON STOCK OWNED BY US, CONSTITUTE
AT LEAST 90% OF THE OUTSTANDING SHARES OF THERMO INSTRUMENT COMMON STOCK UPON
THE EXPIRATION OF THE EXCHANGE OFFER. AS OF MAY 31, 2000, WE OWNED 114,594,884
SHARES OF THERMO INSTRUMENT COMMON STOCK, REPRESENTING APPROXIMATELY 88.5% OF
THE OUTSTANDING SHARES OF THERMO INSTRUMENT COMMON STOCK ON THAT DATE.
Our common stock trades on the New York Stock Exchange under the symbol
"TMO." On June 26, 2000, the last reported sale price for our common stock was
$20.4375. Thermo Instrument common stock trades on the American Stock Exchange
under the symbol "THI." On June 26, 2000, the last reported sale price for
Thermo Instrument common stock was $17.3125.
An investment in our common stock involves a high degree of risk. You should
carefully review the "Risk Factors" beginning on page 12 for a discussion of
important factors that you should consider in connection with our offer, the
merger and an investment in our common stock.
------------------------
We incorporate by reference into this prospectus important business and
financial information about Thermo Instrument and about us. This information is
not included in, or delivered with, this prospectus.
We will provide you with a copy of any and all of the information that we
incorporate by reference in this prospectus, without charge, upon written or
oral request. If we do not specifically incorporate by reference in this
prospectus exhibits to the documents that we incorporate in this prospectus,
then we will not provide copies of those exhibits. TO OBTAIN TIMELY DELIVERY,
YOU MUST REQUEST THE INFORMATION NO LATER THAN JUNE 22, 2000.
You should direct any requests for documents relating to Thermo Instrument
or to us to: Sandra L. Lambert, Corporate Secretary, Thermo Electron
Corporation, 81 Wyman Street, Waltham, Massachusetts 02454 (telephone:
781-622-1000; facsimile: 781-768-6620).
------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIME.
------------------------
The date of this prospectus is , 2000
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<S> <C>
SUMMARY..................................................... 1
RISK FACTORS................................................ 12
FORWARD-LOOKING STATEMENTS.................................. 16
INFORMATION ABOUT THERMO ELECTRON AND THERMO INSTRUMENT..... 18
BACKGROUND TO THE EXCHANGE OFFER AND THE MERGER............. 19
THE EXCHANGE OFFER.......................................... 28
MARKET PRICES AND DIVIDENDS................................. 43
THE MERGER; APPRAISAL RIGHTS................................ 44
FEDERAL INCOME TAX CONSEQUENCES............................. 46
COMPARISON OF THE RIGHTS OF HOLDERS OF OUR COMMON STOCK AND
THE RIGHTS OF HOLDERS OF THERMO INSTRUMENT COMMON STOCK... 48
TRANSACTIONS WITH RELATED PARTIES........................... 54
LEGAL MATTERS............................................... 54
EXPERTS..................................................... 54
WHERE YOU CAN FIND MORE INFORMATION......................... 55
THERMO ELECTRON CORPORATION PRO FORMA CONSOLIDATED CONDENSED
FINANCIAL STATEMENTS (UNAUDITED).......................... F-1
ANNEX A..................................................... A-1
ANNEX B..................................................... B-1
ANNEX C..................................................... C-1
</TABLE>
THIS PROSPECTUS INCORPORATES IMPORTANT BUSINESS AND FINANCIAL INFORMATION
ABOUT THERMO ELECTRON AND THERMO INSTRUMENT THAT IS NOT INCLUDED OR DELIVERED
WITH THE PROSPECTUS. YOU MAY OBTAIN THIS INFORMATION WITHOUT CHARGE TO YOU UPON
WRITTEN OR ORAL REQUEST. YOU MUST ADDRESS YOUR REQUEST TO SANDRA L. LAMBERT,
CORPORATE SECRETARY, THERMO ELECTRON CORPORATION, 81 WYMAN STREET, WALTHAM,
MASSACHUSETTS 02454-9046, TELEPHONE (781) 622-1000. TO OBTAIN TIMELY DELIVERY,
YOU MUST REQUEST THE INFORMATION NO LATER THAN JUNE 22, 2000.
<PAGE> 4
SUMMARY
Before you make any decision with respect to the exchange offer or the
merger, you should read the following summary together with the more detailed
information included elsewhere, or that we incorporate by reference, in this
prospectus.
- THE COMPANIES
- Thermo Electron Corporation (page 18). Thermo Electron Corporation, a
Delaware corporation, develops, manufactures and sells measurement and
detection instruments that our customers use to collect, monitor and
analyze data. We conduct this business in significant part through Thermo
Instrument. As discussed below, we are in the process of spinning off a
business that serves the healthcare industry with a range of medical
products for diagnosis and monitoring, and our paper recycling and
papermaking equipment business. We are also in the process of selling
various non-core businesses. We plan to take Thermo Ecotek Corporation,
our electric power generation business, private. Although we no longer
consider it a core business under our new strategy, we expect to retain
Thermo Ecotek after it is taken private while we continue to evaluate how
to best exit that business and create maximum value for our stockholders.
Our common stock is listed on the New York Stock Exchange under the symbol
"TMO." Our principal executive offices are located at 81 Wyman Street,
P.O. Box 9046, Waltham, Massachusetts 02454-9046, and our telephone number
is (781) 622-1000.
- Thermo Instrument Systems Inc. (page 18). Thermo Instrument Systems
Inc., a Delaware corporation, is a worldwide leader in developing,
manufacturing and marketing measurement instruments used to monitor,
collect and analyze information. Thermo Instrument's customers use these
systems for multiple applications in a range of industries, including
industrial processing, food and beverage production, life sciences
research and medical diagnostics. Thermo Instrument common stock is
listed on the American Stock Exchange under the symbol "THI." Thermo
Instrument's principal executive offices are located at 81 Wyman Street,
P.O. Box 9046, Waltham, Massachusetts 02454-9046, and its telephone
number is (781) 622-1000.
- Affiliation of Thermo Instrument and Thermo Electron (pages 23 and
24). We own a majority of Thermo Instrument's common stock. Several
officers of Thermo Instrument are also officers or directors of Thermo
Electron. See "Background To The Exchange Offer And The Merger."
- The Thermo Electron reorganization (page 19). On January 31, 2000, we
announced that our board of directors had authorized our management to
proceed with a major reorganization of our operations. As part of this
reorganization, we plan to:
- acquire the public minority interest in most of our subsidiaries that
have minority investors;
- spin off a business that serves the healthcare industry with a range
of medical products for diagnosis and monitoring, and our paper
recycling and papermaking equipment business; and
- divest a variety of non-core businesses.
The primary goal of the reorganization is to allow us to focus on our core
business and each of our spun-off subsidiaries to focus on its core
business. The purpose of the exchange offer and merger described in this
prospectus is to allow us to acquire the minority public interest in
Thermo Instrument as part of our overall reorganization. The exchange
offer and merger also would provide the public stockholders of Thermo
Instrument with a continuing equity interest in the restructured company.
We plan to retain Thermo Instrument as part of our core instrument
business.
- The Thermo Instrument reorganization. Thermo Instrument has historically
conducted its business through wholly-owned subsidiaries and divisions,
as well as majority-owned subsidiaries that are partially owned by public
or private investors. On January 31, 2000, Thermo Instrument announced
its intention to acquire, through cash tender offers and mergers, the
interests of public stockholders
1
<PAGE> 5
in five subsidiaries that it does not wholly own. Thermo Instrument completed
these acquisitions in the second quarter of 2000. Thermo Instrument's total cost
of acquiring the public minority interests in these subsidiaries was
approximately $240 million, which we loaned to Thermo Instrument. As a
result of these tender offers and mergers, Spectra-Physics Lasers, Inc. is
Thermo Instrument's only subsidiary with publicly-held minority interests.
Thermo Instrument acquired the publicly-held minority interests in these
subsidiaries as part of our reorganization described above.
- PRINCIPAL TERMS OF THE EXCHANGE OFFER
- Exchange offer for all outstanding Thermo Instrument shares (page
28). We are offering to acquire all of the outstanding shares of common
stock of Thermo Instrument that we do not currently own in exchange for
shares of our common stock.
- Exchange ratio (page 28). We are offering to exchange 0.85 shares of our
common stock for each share of Thermo Instrument common stock that Thermo
Instrument stockholders validly tender in the exchange offer. We
sometimes refer to this ratio of 0.85 to 1 as the "exchange ratio." The
following table shows the last reported sale price of Thermo Instrument
common stock on the American Stock Exchange and our common stock on the
New York Stock Exchange on March 7, 2000, the last trading date before we
announced the exchange ratio, and on June 26, 2000, the last trading date
before the date of this prospectus.
<TABLE>
<CAPTION>
DATE THERMO INSTRUMENT THERMO ELECTRON
---- ----------------- ---------------
<S> <C> <C>
March 7, 2000.......................................... $19.9375 $24.00
June 26, 2000.......................................... $17.3125 $20.4375
</TABLE>
The exchange ratio represents a valuation of the Thermo Instrument common
stock at a premium of 2.3% over its last reported sale price on March 7,
2000, based on the last reported sale price of our common stock on that
date. For more information regarding the trading ranges of our common
stock and Thermo Instrument common stock, see "-- Comparative Per Share
Market Information."
- Cash in lieu of fractional shares (page 28). We will not issue
fractional shares of our common stock in the exchange offer or the
merger. Instead, we will pay an amount in cash equal to $19.1875 per
whole share of our common stock for fractional shares.
- Expiration of the exchange offer (page 28). The exchange offer will
expire at 12:00 midnight on Thursday, June 29, 2000. We can elect at any
time to extend the exchange offer. If we extend the exchange offer, we
will issue a press release announcing the extension. See "The Exchange
Offer -- Terms Of The Exchange Offer; Expiration Of The Exchange Offer."
- Procedures for accepting the exchange offer and tendering shares (page
32). To exchange your shares of Thermo Instrument common stock for
shares of our common stock in the exchange offer, you must follow the
procedures described below under "The Exchange Offer -- Procedures For
Accepting The Offer And Tendering Shares" and in the accompanying letter
of transmittal before the exchange offer expires. If you are the record
owner of your shares and you tender your shares in the exchange offer,
you will not have to pay brokerage fees or incur similar expenses. If you
own your shares through a broker or other nominee and your broker tenders
the shares on your behalf, your broker may charge you a fee for doing so.
You should consult your broker or nominee to determine whether any
charges will apply.
- Issuance of Thermo Electron shares for tendered shares (page 30). If we
satisfy or waive all of the conditions of the exchange offer and we
accept for exchange shares of Thermo Instrument common stock that you
tendered, we will issue you shares of our common stock in exchange for
your shares of Thermo Instrument common stock promptly after the exchange
offer expires. See "The Exchange Offer -- Acceptance For Exchange And
Exchange Of Shares."
2
<PAGE> 6
- Withdrawal rights (page 35). You may withdraw shares of Thermo
Instrument common stock that you have tendered at any time on or before
June 29, 2000, or, if we extend the exchange offer, before the exchange
offer expires. Unless accepted for exchange on or before June 22, 2000,
you may also withdraw shares that you have tendered and which we have not
accepted for exchange at any time after June 22, 2000. For your
withdrawal to be effective, American Stock Transfer & Trust Company, the
depositary for the exchange offer, must receive your notice of withdrawal
at one of the addresses on the back cover of this prospectus before the
exchange offer expires. For more information on your withdrawal rights,
see "The Exchange Offer -- Withdrawal Rights."
- Conditions of the exchange offer (page 36). Our obligation to complete
the exchange offer is subject to a number of conditions. In particular,
Thermo Instrument stockholders must tender, and not withdraw, enough
shares of Thermo Instrument common stock so that at the time the exchange
offer expires we own at least 90% of Thermo Instrument's outstanding
shares of common stock. As of May 31, 2000:
<TABLE>
<S> <C>
Our ownership of Thermo Instrument common stock as a
percentage of outstanding shares was:..................... 88.5%
Based on that percentage, the number of shares of Thermo
Instrument common stock that Thermo Instrument
stockholders must tender for us to meet the 90% condition
is:....................................................... 1,898,056
Our ownership of Thermo Instrument common stock as a
percentage of the shares of Thermo Instrument common stock
then outstanding, assuming that optionholders had
exercised all outstanding Thermo Instrument options issued
by Thermo Instrument or by us and debenture holders did
not convert any of the two issues of Thermo Instrument's
outstanding $422.5 million total principal amount of
convertible debentures into Thermo Instrument common stock
at their conversion prices of $35.65 per share and $34.456
per share, would have been:............................... 85.0%
Based on that percentage, the number of shares of Thermo
Instrument common stock that Thermo Instrument
stockholders must tender for us to meet the 90% condition
is:....................................................... 6,676,893
</TABLE>
As of June 26, 2000, Thermo Instrument stockholders had tendered and not
withdrawn 11,866,494 shares of Thermo Instrument common stock pursuant to
this exchange offer. These shares may be withdrawn at any time before the
exchange offer expires.
In addition, our obligation to complete the exchange offer is subject to
the condition that the SEC declare effective the registration statement of
which this prospectus is a part. You can tender your shares of Thermo
Instrument common stock before the registration statement is effective but
we cannot accept these shares for exchange before the registration
statement is effective or before the exchange offer expires. If the SEC
has not declared the registration statement effective by the expiration
date, we will extend or withdraw the exchange offer. For more information
regarding the conditions to our obligation to complete the exchange offer,
see "The Exchange Offer -- Conditions Of The Offer." We are not aware of
any other material filing, approval or other action by any federal or
state governmental or administrative authority that we must obtain in
connection with our acquisition of shares of Thermo Instrument common
stock as contemplated in this prospectus.
- THE MERGER
- Subsequent merger (page 44). We plan to take Thermo Instrument private
by acquiring all of the outstanding shares of Thermo Instrument common
stock that we do not currently own. The exchange offer is the first step
in this plan. If we complete the exchange offer, we will own at least 90%
of Thermo Instrument's outstanding shares of common stock. We would then
cause Thermo Instrument to merge with and into Thermo Electron in a
so-called "short-form" merger. A short-
3
<PAGE> 7
form merger would not require approval of Thermo Instrument's board of directors
or the stockholders of Thermo Instrument other than Thermo Electron.
- No public stockholder action for merger; appraisal rights (page 44). We
do not intend to enter into a merger agreement with Thermo Instrument or
to seek the approval of the directors of Thermo Instrument for the
merger. Even if you do not tender your shares of Thermo Instrument common
stock in the exchange offer, you would not be entitled to vote your
shares with respect to the merger. If you do not tender your shares and
we complete the merger, you would have a right to demand a judicial
appraisal of the fair value of your shares of Thermo Instrument common
stock. You could lose your right to an appraisal, however, if you fail to
follow the statutory procedure. See "The Merger; Appraisal Rights."
- Merger consideration (page 44). In the merger, we would issue 0.85
shares of our common stock for each share of Thermo Instrument common
stock that we do not already own. This is the same consideration for each
share of Thermo Instrument common stock that we are offering in this
exchange offer. See "Background To The Exchange Offer And The
Merger -- The Merger."
- SHARE OWNERSHIP INFORMATION
- Thermo Instrument shares outstanding. As of May 31, 2000, Thermo
Instrument had outstanding:
- 129,436,600 shares of common stock;
- options to purchase 5,299,822 shares of common stock;
- $250 million principal amount of 4% convertible subordinated
debentures due January 2005 convertible into a total of 7,012,623
shares of common stock; and
- $172.5 million principal amount of 4.5% senior convertible debentures
due October 2003 convertible into a total of 5,006,385 shares of
common stock.
- Ownership of Thermo Instrument common stock by Thermo Electron and
officers and directors of Thermo Electron and Thermo Instrument. On May
31, 2000, we owned 114,594,884 shares of Thermo Instrument common stock,
or approximately 88.5% of the outstanding shares of Thermo Instrument
common stock. Assuming that optionholders exercised all outstanding
options to purchase Thermo Instrument common stock and debenture holders
did not convert any of Thermo Instrument's outstanding 4% convertible
subordinated debentures into Thermo Instrument common stock at the
current conversion price of $35.65 per share or 4.5% senior convertible
debentures into Thermo Instrument common stock at the current conversion
price of $34.456 per share, we would have owned 84.8% of the outstanding
shares of Thermo Instrument common stock on that date. In addition, on
January 31, 2000, our directors and executive officers owned less than 1%
of the outstanding shares of our common stock and less than 1% of the
outstanding shares of Thermo Instrument common stock. On January 31,
2000, the directors and executive officers of Thermo Instrument who are
not also our directors or executive officers owned less than 1% of the
outstanding shares of Thermo Instrument common stock and less than 1% of
the outstanding shares of our common stock. On that date, our executive
officers and directors also owned options to purchase 2,660,715 shares of
our common stock and 733,790 shares of Thermo Instrument common stock.
- Ownership of Thermo Electron after the exchange offer and the merger. If
we acquire all of the outstanding shares of Thermo Instrument common
stock pursuant to the exchange offer and the merger, former stockholders
of Thermo Instrument would acquire through the exchange offer and the
merger approximately 7.5% of the then outstanding shares of our common
stock, based upon the number of shares of Thermo Instrument common stock
and of our common stock outstanding on May 31, 2000 and the assumption
that no Thermo Instrument optionholders exercise their options and that
no Thermo Instrument debenture holders convert their debentures. In our
reorganization, we are also offering shares of our common stock in
connection with acquiring the
4
<PAGE> 8
minority interests in a number of our other public subsidiaries. We would
issue approximately 9.8 million additional shares of our common stock in
these other transactions, assuming that optionholders do not exercise any
options to purchase shares of common stock of the subject companies and
debenture holders do not convert any convertible debt securities of the
subject companies.
- RISK FACTORS (PAGE 12)
Before you make any decision about the exchange offer or the merger, you
should read carefully this prospectus and the documents that we incorporate by
reference in this prospectus. You should also carefully consider the risks of
the exchange offer and the merger, our reorganization and our business that we
identify in this prospectus and in the documents that we incorporate by
reference in this prospectus. These risks include the following:
- we may not complete our reorganization as proposed, including the two
proposed spin-offs, the acquisition of the minority interests in most of
our subsidiaries and the dispositions of our non-core businesses;
- we may not realize the anticipated benefits of our reorganization;
- the fixed exchange ratio in this exchange offer and the merger may work
to your disadvantage if Thermo Instrument common stock increases in value
or our common stock decreases in value;
- the trading price for our common stock has been and may continue to be
volatile; and
- our business is subject to a number of risks, including intense
competition, rapid technological changes, significant governmental
regulation and difficulties of international operations.
You should carefully review "Risk Factors" beginning on page 12 for a more
complete discussion of these and other risk factors relating to the exchange
offer, the merger, our reorganization and our business.
- FEDERAL INCOME TAX CONSEQUENCES (PAGE 46)
For federal income tax purposes, your receipt of shares of our common stock
pursuant to the exchange offer or the merger would be tax-free. However, you
would recognize taxable income upon the receipt of cash in lieu of fractional
shares of our common stock in the exchange offer or the merger.
For a more detailed discussion of the tax consequences of the exchange
offer and the merger, you should carefully review "Federal Income Tax
Consequences." We urge you to consult with your own tax advisor.
- CONSEQUENCES OF THE OFFER AND THE MERGER (PAGE 24)
Completion of the exchange offer and the merger would have the following
consequences:
- The shares of Thermo Instrument would no longer be listed on the American
Stock Exchange; and
- Thermo Instrument would no longer be subject to the requirements of the
Securities Exchange Act of 1934, including requirements to file annual
and other periodic reports.
If you do not tender your shares of Thermo Instrument common stock and we
complete the exchange offer, your shares will remain outstanding until the
merger of Thermo Instrument and Thermo Electron. After the merger, each of your
shares will convert, subject to appraisal rights, into the right to receive 0.85
shares of our common stock.
- EFFECT OF THE MERGER ON THERMO INSTRUMENT STOCK OPTIONS AND DEBENTURES (PAGES
26 AND 27)
- Stock options. In connection with the exchange offer and the merger, we
will assume Thermo Instrument's stock option plans and any outstanding
options to purchase shares of Thermo Instrument common stock under those
plans. After we have assumed these options, they will be
5
<PAGE> 9
exercisable for shares of our common stock. The number of shares of our
common stock underlying each assumed option will equal the number of
shares of Thermo Instrument common stock underlying the option before the
merger multiplied by the exchange ratio. The exercise price for each
assumed option will be calculated by dividing the exercise price of the
Thermo Instrument stock option before the merger by the exchange ratio,
rounded up to the nearest whole cent.
- Debentures. In connection with the merger, we will assume Thermo
Instrument's 4% convertible subordinated debentures due January 2005 and
its 4.5% senior convertible debentures due October 2003. After we assume
these debentures, they will be convertible into shares of our common
stock, instead of shares of Thermo Instrument common stock. A total of
$250 million principal amount of the 4% debentures was outstanding and a
total of $172.5 million principal amount of the 4.5% debentures was
outstanding as of May 31, 2000. As of that date, the 4% debentures were
convertible into a total of 7,012,623 shares of Thermo Instrument common
stock at a conversion price of $35.65 per share and the 4.5% debentures
were convertible into a total of 5,006,385 shares of Thermo Instrument
common stock at a conversion price of $34.456 per share. After the
merger, the 4% debentures would be convertible into a total of 5,960,729
shares of our common stock at a conversion price of $41.94 per share and
the 4.5% debentures would be convertible into a total of 4,255,427 shares
of our common stock at a conversion price of $40.54 per share. Holders of
these debentures will not have the right to require Thermo Instrument to
redeem their debentures as a result of the merger.
- POTENTIAL CONFLICTS OF INTEREST (PAGE 22)
In setting the exchange ratio, our financial interest was adverse to the
financial interest of the public stockholders of Thermo Instrument. We set the
exchange ratio on our own and without any negotiations with Thermo Instrument.
- APPRAISAL RIGHTS (PAGE 44)
If you tender your shares of Thermo Instrument common stock in the exchange
offer, you will not be entitled to exercise appraisal rights under the Delaware
General Corporation Law. If you do not tender your shares in the exchange offer,
upon the merger of Thermo Instrument into Thermo Electron, you will have a right
to dissent and demand payment of the judicially appraised fair value of your
Thermo Instrument shares under the Delaware General Corporation Law. This value
may be more or less than the market value of the 0.85 shares of our common stock
issuable for each share of Thermo Instrument common stock in the exchange offer
and the merger. See "The Merger; Appraisal Rights."
- COMPARISON OF STOCKHOLDERS' RIGHTS (PAGE 48)
If you tender your shares of Thermo Instrument common stock in the exchange
offer or do not exercise appraisal rights in the merger, you will become a
stockholder of Thermo Electron. Your rights as a stockholder of Thermo Electron
will be governed by our certificate of incorporation and bylaws. Unlike Thermo
Instrument, we have a classified board of directors and we have adopted a
stockholders rights plan. The classified board, the rights plan and other
provisions of our certificate of incorporation and bylaws may make it more
difficult for a third party to acquire us, even if an acquisition is favored by
many of our stockholders. See "Comparison Of The Rights Of Holders Of Our Common
Stock And The Rights Of Holders Of Thermo Instrument Common Stock."
- SUMMARY HISTORICAL AND UNAUDITED PRO FORMA COMBINED SELECTED FINANCIAL
INFORMATION
We will exchange shares of our common stock for shares of Thermo Instrument
common stock that we accept in the exchange offer or we acquire in the merger.
You should consider our financial condition before you decide to become one of
our stockholders through the exchange offer or the merger. In considering our
financial condition, you should review the documents that we incorporate by
reference in this prospectus because they contain detailed business, financial
and other information about us and about Thermo Instrument.
6
<PAGE> 10
SELECTED FINANCIAL INFORMATION -- THERMO ELECTRON
We have derived the selected financial information presented below as of
and for the fiscal years ended January 1, 2000, and January 2, 1999, and for the
fiscal year ended January 3, 1998, from our consolidated financial statements,
which Arthur Andersen LLP, independent public accountants, audited, as indicated
in their report. We incorporate these financial statements by reference into
this prospectus from our Annual Report on Form 10-K for the fiscal year ended
January 1, 2000. We have derived the selected financial information presented
below as of January 3, 1998, and as of and for the fiscal years ended December
28, 1996 and December 30, 1995, from our consolidated financial statements,
which Arthur Andersen LLP audited, but which we have not included or
incorporated by reference in this prospectus. You should read this information
in conjunction with our consolidated financial statements and the related notes
that we incorporate by reference into this prospectus. The selected financial
information as of and for the three months ended April 1, 2000, and April 3,
1999, has not been audited but, in our opinion, includes all adjustments,
consisting only of normal recurring adjustments, necessary to present fairly
such information in accordance with generally accepted accounting principles
applied on a consistent basis. The results of operations for the three months
ended April 1, 2000, are not necessarily indicative of results for the entire
year.
<TABLE>
<CAPTION>
THREE MONTHS ENDED
----------------------- FISCAL YEAR(1)
APRIL 1, APRIL 3, --------------------------------------------------------------
2000 1999 1999(2) 1998(3) 1997 1996(4) 1995
---------- ---------- ---------- ---------- ---------- ---------- ----------
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA:
Revenues.............................. $ 598,929 $ 555,750 $2,471,193 $2,055,805 $1,979,602 $1,573,005 $1,059,064
Income (Loss) from Continuing
Operations Before Extraordinary
Items............................... 15,291 18,069 (14,580) 114,676 174,665 164,172 76,167
Net Income (Loss)..................... 15,823 28,299 (174,573) 181,901 239,328 190,816 139,582
Earnings (Loss) per Share from
Continuing Operations Before
Extraordinary Items:
Basic............................... .10 .11 (.09) .71 1.15 1.16 .60
Diluted............................. .09 .11 (.11) .67 1.05 1.03 .55
Earnings (Loss) per Share:
Basic............................... .10 .18 (1.10) 1.12 1.57 1.35 1.10
Diluted............................. .09 .17 (1.13) 1.08 1.41 1.17 .95
BALANCE SHEET DATA (AT END OF PERIOD):
Working Capital....................... $1,629,388 $1,450,858 $2,163,010 $2,001,963 $2,218,617 $1,317,146
Total Assets.......................... 5,177,187 5,181,842 5,421,060 4,961,046 4,546,942 3,247,952
Long Term Obligations................. 1,570,323 1,565,974 1,808,582 1,518,687 1,531,668 1,079,761
Minority Interest..................... 364,900 364,278 399,512 464,191 364,163 200,868
Common Stock of Subsidiaries Subject
to Redemption....................... 7,692 7,692 40,500 40,500 2,613 --
Shareholders' Investment.............. 2,014,251 2,014,486 2,254,802 2,007,862 1,755,576 1,311,311
OTHER DATA (UNAUDITED):
Book Value per Share.................. $ 12.84 $ 12.87 $ 14.23 $ 12.62 $ 11.71 $ 9.82
Cash Dividends Declared per Share..... -- -- -- -- -- --
Ratio of Earnings to Fixed
Charges(5).......................... 2.38x 1.32x 3.35x
</TABLE>
---------------
(1) Our 1999, 1998, 1997, 1996 and 1995 fiscal years ended January 1, 2000,
January 2, 1999, January 3, 1998, December 28, 1996 and December 30, 1995,
respectively.
(2) Reflects a $182.4 million pretax charge for restructuring and related costs.
(3) Reflects a $32.5 million pretax charge for restructuring and related costs,
the issuance of $150.0 million principal amount of our notes and our public
offering of common stock for net proceeds of $290.1 million.
(4) Reflects the issuance of $585.0 million principal amount of our convertible
debentures.
(5) For purposes of computing the ratios of earnings to fixed charges,
"earnings" represent income from continuing operations before taxes and
minority interest, plus fixed charges. "Fixed charges" consist of interest
on indebtedness and amortization of debt expense and one-third of rental
expense, which is treated as the interest component of rental expense.
7
<PAGE> 11
SELECTED FINANCIAL INFORMATION -- THERMO INSTRUMENT
We have derived the selected financial information presented below as of
and for the fiscal years ended January 1, 2000, and January 2, 1999, and for the
fiscal year ended January 3, 1998, from Thermo Instrument's consolidated
financial statements, which Arthur Andersen LLP, independent public accountants,
audited, as indicated in their report. We incorporate these financial statements
by reference into this prospectus from Thermo Instrument's Annual Report on Form
10-K for the fiscal year ended January 1, 2000. We have derived the selected
financial information presented below as of January 3, 1998, and as of and for
the fiscal years ended December 28, 1996 and December 30, 1995, from Thermo
Instrument's consolidated financial statements, which Arthur Andersen LLP
audited, but which we have not included or incorporated by reference in this
prospectus. You should read this information in conjunction with Thermo
Instrument's consolidated financial statements and the related notes that we
incorporate by reference into this prospectus. The selected financial
information as of and for the three months ended April 1, 2000, and April 3,
1999, has not been audited but, in the opinion of Thermo Instrument, includes
all adjustments, consisting only of normal recurring adjustments, necessary to
present fairly such information in accordance with generally accepted accounting
principles applied on a consistent basis. The results of operations for the
three months ended April 1, 2000, are not necessarily indicative of results for
the entire year.
<TABLE>
<CAPTION>
THREE MONTHS ENDED
--------------------- FISCAL YEAR(1)
APRIL 1, APRIL 3, --------------------------------------------------------------
2000 1999 1999(2) 1998(3) 1997(4) 1996(5) 1995
---------- -------- ---------- ---------- ---------- ---------- ----------
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF INCOME DATA:
Revenues............................... $ 521,086 $463,579 $2,093,537 $1,659,981 $1,592,314 $1,209,362 $ 782,662
Income Before Extraordinary Item....... 19,332 18,885 87,799 103,565 147,258 132,751 79,306
Net Income............................. 19,332 18,885 87,799 104,084 147,258 132,751 79,306
Earnings per Share:
Basic................................ .16 .16 .74 .86 1.21 1.12 .70
Diluted.............................. .15 .15 .67 .79 1.09 1.01 .64
BALANCE SHEET DATA (AT END OF PERIOD):
Working Capital........................ $ 410,152 $ 368,800 $ 745,955 $ 612,666 $ 636,703 $ 489,895
Total Assets........................... 2,851,282 2,885,358 2,565,774 2,351,153 1,924,400 1,372,813
Long Term Obligations.................. 454,561 596,494 743,443 673,194 554,214 441,034
Shareholders' Investment............... 1,129,898 984,566 945,007 877,558 746,267 542,705
OTHER DATA (UNAUDITED):
Book Value per Share................... $ 8.73 $ 8.29 $ 7.92 $ 7.19 $ 6.16 $ 4.74
Cash Dividends Declared per Share...... -- -- -- -- -- --
Ratio of Earnings to Fixed
Charges(6)........................... 3.76x 3.78x 4.45x
</TABLE>
---------------
(1) Thermo Instrument's 1999, 1998, 1997, 1996 and 1995 fiscal years ended
January 1, 2000, January 2, 1999, January 3, 1998, December 28, 1996 and
December 30, 1995, respectively.
(2) Reflects a pretax charge of $21.7 million for restructuring and related
costs, consisting of restructuring and unusual costs, net, of $15.0 million
and inventory provisions of $6.7 million. Also reflects the February 1999
acquisition of Spectra-Physics AB, the reclassification as short-term of an
aggregate of $130.0 million of 5% subordinated convertible debentures of
ThermoQuest Corporation and Thermo Optek Corporation due August and October
2000, respectively, and the classification as noncurrent of Thermo
Instrument's $140.0 million 3 3/4% senior convertible note as a result of
its conversion by Thermo Electron in February 2000.
(3) Reflects a pretax charge of $31.8 million, consisting of restructuring and
unusual costs, net, of $23.2 million and inventory provisions of $8.6
million. Also reflects nontaxable gains of $18.6 million from the issuance
of stock by subsidiaries and the January 1998 issuance of $250.0 million
principal amount of 4% subordinated convertible debentures due 2005.
(4) Reflects the March 1997 acquisition of Life Sciences International PLC and
nontaxable gains of $46.4 million from the issuance of stock by
subsidiaries.
(5) Reflects the March 1996 acquisition of a substantial portion of the
businesses constituting the Scientific Instruments Division of Fisons plc,
the October 1996 issuance of $172.5 million principal amount of 4 1/2%
senior convertible debentures due 2003 and nontaxable gains of $71.7 million
from the issuance of stock by subsidiaries.
(6) For purposes of computing the ratios of earnings to fixed charges,
"earnings" represent income before taxes and minority interest, plus fixed
charges. "Fixed charges" consist of interest on indebtedness and
amortization of debt expense and one-third of rental expense, which is
treated as the interest component of rental expense.
8
<PAGE> 12
UNAUDITED PRO FORMA COMBINED SELECTED FINANCIAL INFORMATION
AND COMPARATIVE PER SHARE DATA
The following table presents unaudited pro forma combined selected
financial information for us and for Thermo Instrument, historical selected
financial information for us and for Thermo Instrument, and unaudited pro forma
combined per share data for us and for Thermo Instrument. We derived the
historical financial information from our financial statements and those of
Thermo Instrument, which we incorporate by reference into this prospectus. We
derived the pro forma information from the pro forma consolidated condensed
financial information included elsewhere in this prospectus. The unaudited pro
forma consolidated condensed statement of operations data sets forth our results
of operations for the three months ended April 1, 2000, and the fiscal year
ended January 1, 2000, assuming that we had successfully completed the exchange
offer and the merger as of the beginning of fiscal 1999. The unaudited pro forma
consolidated condensed balance sheet data set forth our financial position as of
April 1, 2000, assuming that we had successfully completed the exchange offer
and the merger on April 1, 2000.
This data is not necessarily indicative of the results of the future
operations of the combined entity or the actual results that would have occurred
had we completed the exchange offer and the merger prior to the periods
indicated.
<TABLE>
<CAPTION>
THREE MONTHS ENDED FISCAL YEAR ENDED
APRIL 1, 2000 JANUARY 1, 2000
------------------ -----------------
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<S> <C> <C>
PRO FORMA COMBINED:
STATEMENT OF OPERATIONS DATA:
Revenues................................................ $ 598,929 $2,471,193
Income (Loss) from Continuing Operations Before
Extraordinary Items.................................. 16,551 (7,347)
BALANCE SHEET DATA (AT END OF PERIOD):
Working Capital......................................... $1,629,388
Total Assets............................................ 5,341,149
Long-term Obligations................................... 1,570,323
Minority Interest....................................... 235,993
Common Stock of Subsidiaries Subject to Redemption...... 7,692
Shareholders' Investment................................ 2,307,120
----------
PER SHARE DATA:
THERMO ELECTRON (HISTORICAL):
Book Value per Common Share............................. $ 12.84
Cash Dividends Declared per Share....................... -- --
Earnings (Loss) per Share from Continuing Operations
Before Extraordinary Items:
Basic................................................ $ .10 $ (.09)
Diluted.............................................. $ .09 $ (.11)
Ratio of Earnings to Fixed Charges(2)................... 2.38x 1.32x
PRO FORMA:
COMBINED PER SHARE OF THERMO ELECTRON STOCK:
Book Value per Common Share............................. $ 13.62
Cash Dividends Declared per Share....................... -- --
Earnings (Loss) per Share from Continuing Operations
Before Extraordinary Items:
Basic................................................ $ .10 $ (.04)
Diluted.............................................. $ .09 $ (.06)
Ratio of Earnings to Fixed Charges(2)................... 2.34x 1.29x
</TABLE>
9
<PAGE> 13
<TABLE>
<CAPTION>
THREE MONTHS ENDED FISCAL YEAR ENDED
APRIL 1, 2000 JANUARY 1, 2000
------------------ -----------------
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<S> <C> <C>
COMBINED PER THERMO ELECTRON SHARE EQUIVALENT(1):
Book Value per Common Share............................. $ 11.57
Cash Dividends Declared per Share....................... -- --
Earnings (Loss) per Share from Continuing Operations
Before Extraordinary Items:
Basic................................................ $ .08 $ (.04)
Diluted.............................................. $ .08 $ (.05)
Ratio of Earnings to Fixed Charges(2)................... 1.99x 1.10x
THERMO INSTRUMENT (HISTORICAL):
Book Value per Common Share............................. $ 8.73
Cash Dividends Declared per Share....................... -- --
Earnings per Share:
Basic................................................ $ .16 $ .74
Diluted.............................................. $ .15 $ .67
Ratio of Earnings to Fixed Charges(2)................... 3.76x 3.78x
</TABLE>
---------------
(1) Pro forma combined per Thermo Electron share equivalent data has been
calculated based on the pro forma combined data for Thermo Electron common
stock, multiplied by an exchange ratio of 0.85. See "-- Principal Terms of
the Exchange Offer -- Exchange ratio" for a description of the exchange
ratio. The exchange ratio is the 0.85 shares of our common stock which you
would have received for each share of Thermo Instrument common stock in the
exchange offer or the merger.
(2) For purposes of computing the ratios of earnings to fixed charges,
"earnings" represent income from continuing operations before taxes and
minority interest, plus fixed charges. "Fixed charges" consist of interest
on indebtedness and amortization of debt expense and one-third of rental
expense, which is treated as the interest component of rental expense.
10
<PAGE> 14
- COMPARATIVE PER SHARE MARKET INFORMATION (PAGE 43)
Our common stock is traded on the New York Stock Exchange under the symbol
"TMO." Thermo Instrument common stock is traded on the American Stock Exchange
under the symbol "THI."
The following table presents the closing prices per share of Thermo
Instrument common stock and the closing prices per share of our common stock on:
- March 7, 2000, the last trading day before our public announcement of the
terms, including the exchange ratio, of the exchange offer and the
merger; and
- June 26, 2000, the last trading date before the date of this prospectus.
The table also presents, in the line entitled "Equivalent Per Share Price,"
the price per share of Thermo Instrument common stock based upon the exchange
ratio of 0.85 shares of our common stock for each share of Thermo Instrument
common stock.
<TABLE>
<CAPTION>
MARCH 7, 2000 JUNE 26, 2000
------------- -------------
<S> <C> <C>
Thermo Instrument......................................... $19.9375 $17.3125
Thermo Electron........................................... $24.00 $20.4375
Equivalent Per Share Price................................ $20.40 $17.37
</TABLE>
You should obtain current stock price quotations for our common stock and
the Thermo Instrument common stock.
- FOR MORE INFORMATION (PAGE 55)
You can obtain more information about Thermo Instrument and about us from
our respective public filings with the SEC. See "Where You Can Find More
Information."
If you have any questions about the exchange offer, you should call the
information agent, D.F. King & Co., Inc. If you are a banker or broker, call
collect at (212) 269-5550. All others should call toll-free at (800) 290-6433.
11
<PAGE> 15
RISK FACTORS
The exchange offer, the merger and an investment in our common stock
involve a high degree of risk. If any of the following events occurs, our
business, financial condition and results of operations would likely suffer,
possibly materially.
RISK RELATED TO THE EXCHANGE OFFER AND THE MERGER
BECAUSE WE WILL NOT ADJUST THE EXCHANGE RATIO TO REFLECT CHANGES IN OUR OR
THERMO INSTRUMENT'S STOCK PRICE, THE FIXED EXCHANGE RATIO USED IN THE EXCHANGE
OFFER MAY PROVE UNFAVORABLE TO YOU.
We have fixed the exchange ratio at 0.85 shares of our common stock for
each share of Thermo Instrument common stock. We will not adjust the exchange
ratio to reflect fluctuations in the market value of shares of our common stock
or Thermo Instrument common stock. We will use the same exchange ratio in the
exchange offer and the merger. If you tender your shares of Thermo Instrument
common stock and we complete the exchange offer or if you do not tender your
shares of Thermo Instrument common stock and do not properly exercise your
appraisal rights in connection with the merger, you will be locked into the
exchange ratio and you will not be able to capture gains from possible increases
in the value of Thermo Instrument common stock. You may incur losses from
possible decreases in the value of our common stock.
RISKS RELATED TO OUR REORGANIZATION
BECAUSE OUR REORGANIZATION IS VERY COMPLEX AND WILL REQUIRE GOVERNMENTAL AND
THIRD PARTY CONSENTS AND APPROVALS, WE MAY NOT BE ABLE TO SUCCESSFULLY COMPLETE
THIS REORGANIZATION OR TO DO SO ON THE TIME SCHEDULE WE CONTEMPLATE.
Our reorganization consists of:
- the acquisition of the public minority interest in most of our
subsidiaries that have minority investors;
- the spin off of two of our businesses; and
- the sale of a variety of non-core businesses.
To accomplish these objectives, we will need to obtain a variety of governmental
and third party consents and approvals. In particular, in addition to the
Internal Revenue Service ruling that we discuss below, we will need to obtain:
- approval of the spin-offs and some of the other transactions by our board
of directors;
- when we are making a tender or exchange offer, the tender by minority
stockholders of enough shares to allow us to own at least 90% of the
target subsidiary's outstanding shares; and
- the receipt of any necessary third party contractual consents.
We also must make various filings with the SEC relating to the reorganization
that must comply with the SEC's rules.
If we do not receive these consents and approvals and make the required
filings with the SEC in compliance with its rules, we may not be able to effect
all aspects of our reorganization. If we are not able to effect all aspects of
the reorganization, we may not achieve all of the anticipated benefits of our
reorganization. Until we have completed the entire reorganization, we will
continue to own and operate a diverse group of businesses, some of which may
continue to have minority stockholders.
Our reorganization is time-consuming and expensive, and consumes management
resources. The failure of our management to complete the proposed reorganization
in a timely manner could negatively affect the public market's confidence in our
management, which in turn may adversely affect the market price of our common
stock.
12
<PAGE> 16
WE DO NOT EXPECT TO PROCEED WITH OUR TWO PLANNED SPIN-OFFS UNTIL WE RECEIVE A
FAVORABLE RULING FROM THE INTERNAL REVENUE SERVICE, WHICH THE INTERNAL REVENUE
SERVICE MAY NOT ISSUE OR WHICH MAY TAKE A SUBSTANTIAL PERIOD OF TIME FOR US TO
OBTAIN.
We do not expect to spin-off our business that serves the healthcare
industry with a range of medical products for diagnosis and monitoring or our
paper recycling and papermaking equipment business unless we obtain a favorable
ruling from the Internal Revenue Service. The Internal Revenue Service may not
grant the necessary ruling or may seek to impose conditions to the granting of
the ruling that are not acceptable to us. We do not expect the Internal Revenue
Service to issue a tax ruling before the end of 2000, and additional delays are
possible.
AS PART OF OUR REORGANIZATION, WE ARE SEEKING TO DIVEST A SIGNIFICANT NUMBER OF
BUSINESSES; WE MAY NOT SUCCEED IN SELLING ALL OF THESE BUSINESSES IN A TIMELY
MANNER OR AT PRICES WE CONSIDER ACCEPTABLE.
We plan to sell a significant number of businesses as part of our
reorganization. This process will entail a number of risks:
- We may not find buyers for all of these businesses.
- The timing of these dispositions is uncertain.
- We cannot be certain that the terms, including price, for the sale of
these businesses will be acceptable to us.
- Each of these sales will be subject to various conditions, including
conditions in the agreements governing the transaction and the receipt of
necessary governmental approvals.
EVEN IF WE SUCCEED IN COMPLETING OUR REORGANIZATION, WE WILL FACE A NUMBER OF
CHALLENGES IN INTEGRATING OUR INSTRUMENT BUSINESS.
Currently we operate our instrument business directly and through a number
of majority-owned subsidiaries, including Thermo Instrument, Thermedics Inc. and
their publicly traded subsidiaries. We have conducted these operations largely
as autonomous, unaffiliated businesses. As part of our reorganization, we plan
to manage these operations in a more coordinated manner. The following factors
may make it difficult for us to successfully integrate and consolidate our
instrument operations:
- Our success in integrating these businesses will depend on our ability to
coordinate geographically separate organizations and integrate personnel
with different business backgrounds and corporate cultures.
- Our ability to combine these businesses will require coordination of
administrative, sales and marketing, distribution and accounting and
finance functions and expansion of information and management systems.
- The integration process could disrupt our instrument business.
- Retaining key employees of these businesses may be difficult.
OUR REORGANIZATION CONTEMPLATES THE ISSUANCE OF A SIGNIFICANT NUMBER OF
ADDITIONAL SHARES OF OUR COMMON STOCK, WHICH MAY DEPRESS THE MARKET PRICE OF OUR
SHARES.
We expect to issue a substantial number of shares of our common stock or
securities exercisable for shares of our common stock in connection with the
exchange offer, the merger and our reorganization. At May 31, 2000, 155,547,567
shares of our common stock were outstanding. The number of shares of our
13
<PAGE> 17
common stock outstanding may increase by as many as 55.2 million shares because,
as part of our reorganization:
- We plan to exchange shares of our common stock for the common stock held
by minority stockholders in a number of our public subsidiaries,
including Thermo Instrument. We expect to issue a total of approximately
22.3 million shares of our common stock in these transactions.
- We plan to assume employee stock options in these transactions, including
the merger with Thermo Instrument, that would be exercisable for
approximately 15.3 million shares of our common stock. In addition, we
may be required to issue additional stock options to retain our key
employees.
- The debentures issued by some of our subsidiaries, including Thermo
Instrument, will become convertible into shares of our common stock.
Based on the total principal amounts outstanding of these debentures and
the conversion prices at May 31, 2000, these debentures would be
convertible into approximately 17.6 million shares of our common stock.
The increase in the number of outstanding shares of our common stock, as
well as the potential future issuance of shares of our common stock upon
conversion of debentures or exercise of employee stock options, may depress the
market price of our common stock.
WE ARE UNABLE TO PREDICT THE LIQUIDITY OR PROSPECTIVE PERFORMANCE OF THE COMMON
STOCK OF THE COMPANIES THAT WE INTEND TO SPIN OFF.
We are unable to predict the liquidity or market performance of the shares
of the businesses we plan to spin off. Although Thermo Fibertek Inc., the
company that conducts our paper recycling and papermaking equipment business,
has publicly traded shares, the historic prices of these shares may not be
representative of the trading price of Thermo Fibertek's common stock after the
number of shares held by its stockholders other than us increases as a result of
the spin-off. We currently conduct our business that serves the healthcare
industry with a range of medical products for diagnosis and monitoring both
directly and through subsidiaries. There is currently no public trading market
for the shares of the company that will conduct this business following the
proposed spin-off. The businesses that we are spinning off may not have the
financial resources and management skills necessary to succeed as independent
entities.
AS A RESULT OF THE SPIN-OFF OF THERMO FIBERTEK AND ITS SUBSIDIARIES, WE WILL
REMAIN AS THE GUARANTOR OF INDEBTEDNESS AND STOCK REDEMPTION RIGHTS OF THESE
COMPANIES EVEN THOUGH WE WILL NO LONGER CONTROL THEIR BUSINESS OR OPERATIONS.
We have guaranteed the payment of principal and interest on $153 million
principal amount of debentures issued by Thermo Fibertek. These debentures
mature in July 2004. We have also guaranteed the financial obligations of Thermo
Fibergen Inc., a subsidiary of Thermo Fibertek, under stock redemption rights
granted by Thermo Fibergen. We are contingently liable for $60.1 million under
these stock redemption rights, some of which terminate in September 2000 and the
remainder of which terminate in September 2001. We will remain liable as a
guarantor for these obligations following the spin-offs, although we will no
longer control the business or operations of Thermo Fibertek or of its
subsidiaries.
RISKS RELATED TO OUR BUSINESS AND FINANCIAL CONDITION
OUR STOCK PRICE MAY BE VOLATILE, WHICH COULD CAUSE YOU TO LOSE PART OR ALL OF
YOUR INVESTMENT.
The market price for our common stock can be very volatile. As of June 26,
2000, the 52-week range of the market price of our common stock was $12.75 to
$26.875 per share. The market price for our common stock may be affected by a
number of factors, including:
- the risks described in this prospectus;
- our financial results; and
- general market conditions.
14
<PAGE> 18
In addition, the stock market has experienced extreme price and volume
fluctuations. This volatility has significantly affected the market prices of
securities for reasons frequently unrelated to or disproportionate to the
operating performance of the specific companies. These broad market fluctuations
may adversely affect the market price of our common stock.
WE HAVE ACQUIRED SEVERAL COMPANIES AND BUSINESSES; AS A RESULT WE HAVE RECORDED
SIGNIFICANT GOODWILL ON OUR BALANCE SHEET, WHICH WE MUST CONTINUALLY EVALUATE
FOR POTENTIAL IMPAIRMENT.
We have acquired significant intangible assets, including approximately
$1.2 billion of cost in excess of net assets of acquired companies, or goodwill,
that we have recorded on our balance sheet as of January 1, 2000. We amortize
this goodwill principally over 40 year periods. We assess the future useful life
of the goodwill we have on our books whenever events or changes in circumstances
indicate that the current useful life has diminished. These events or
circumstances generally include operating losses or a significant decline in
earnings associated with the acquired business or asset. Goodwill amortization
from our continuing operations was $35 million in fiscal 1999. In addition, in
fiscal 1999 we wrote off $29 million of goodwill attributable to our continuing
operations that we determined was impaired in connection with the planned sale
of our power electronics and test equipment business.
We expect to record additional goodwill in 2000 as a result of our
acquisition of the minority interests in most of our publicly-traded
subsidiaries. Our ability to realize the value of this asset will depend on
future cash flows of the businesses in which we acquire these interests. These
cash flows in turn depend in part on how well we can integrate these businesses.
IT MAY BE DIFFICULT FOR US TO EXPAND BECAUSE SOME OF THE MARKETS FOR OUR
PRODUCTS ARE NOT GROWING.
Some of the markets in which we compete have been flat or declining over
the past several years. To address this issue, we are pursuing a number of
strategies to improve our internal growth, including:
- finding new markets for our products;
- developing new applications for our technologies;
- combining sales and marketing operations in appropriate markets to
compete more effectively;
- actively funding research and development; and
- strengthening our presence in selected geographic markets.
These strategies may not result in growth of our business, and we may not be
able to successfully implement these strategies.
WE HAVE SIGNIFICANT INTERNATIONAL OPERATIONS, WHICH ENTAIL THE RISK THAT
EXCHANGE RATE FLUCTUATIONS MAY NEGATIVELY AFFECT DEMAND FOR OUR PRODUCTS AND OUR
PROFITABILITY.
We are a global company with substantial operations outside of the United
States. We intend to continue to expand our international operations. In 1999,
our international revenues from continuing operations, including export revenues
from the United States, accounted for approximately 63% of our total revenues.
Our international revenues are subject to the risk that changes in exchange
rates may adversely affect demand for our products and the profitability in U.S.
dollars of products and services we provide in foreign markets, where payment
for our products and services is made in the local currency. For example, in the
first quarter of fiscal 2000, the unfavorable effects of currency translation
decreased revenues of Thermo Electron's continuing operations by $15.6 million.
WE MUST DEVELOP NEW PRODUCTS, ADAPT TO RAPID AND SIGNIFICANT TECHNOLOGICAL
CHANGE AND RESPOND TO INTRODUCTIONS OF NEW PRODUCTS TO REMAIN COMPETITIVE.
Our growth strategy includes significant investment in product development.
We intend to increase our investment in research and development. We sell our
products in several industries that are
15
<PAGE> 19
characterized by rapid and significant technological changes, frequent new
product and service introductions and enhancements and evolving industry
standards. Without the timely introduction of new products, services and
enhancements, our products and services will likely become technologically
obsolete over time, in which case our revenue and operating results would
suffer.
Our customers use many of our products to develop, test and manufacture
their new products. As a result, we must anticipate industry trends and develop
products in advance of the commercialization of our customers' products. If we
fail to adequately predict our customers' needs and future activities, we may
invest heavily in research and development of products and services that do not
lead to significant revenue.
Many of our products and products under development are technologically
innovative and require significant planning, design, development and testing at
the technological, product and manufacturing-process levels. These activities
require us to make significant investments.
Products in our markets undergo rapid and significant technological change
because of quickly changing industry standards and the introduction of new
products and technologies that make existing products and technologies
uncompetitive or obsolete. Our competition may adapt more quickly to new
technologies and changes in our customers' requirements than we can. The
products we are currently developing, or those we will develop in the future,
may not be technologically feasible or accepted by the marketplace, and our
products or technologies could become uncompetitive or obsolete.
CHANGES IN GOVERNMENTAL REGULATIONS MAY REDUCE DEMAND FOR OUR PRODUCTS OR
INCREASE OUR EXPENSES.
We compete in many markets in which we or our customers must comply with
federal, state, local and foreign regulations, such as environmental, health and
safety and food and drug regulations. We develop, configure and market our
products to meet customer needs created by these regulations. Any significant
change in these regulations could reduce demand for our products. For example,
many of our instruments are marketed to the pharmaceutical industry for use in
discovering and developing drugs. Changes in the Food and Drug Administration's
regulation of the drug discovery and development process could have an adverse
effect on the demand for these products.
DEMAND FOR SOME OF OUR PRODUCTS DEPENDS ON CAPITAL SPENDING POLICIES OF OUR
CUSTOMERS AND ON GOVERNMENT FUNDING POLICIES.
Our customers include manufacturers of semiconductors and products
incorporating semiconductors, pharmaceutical and chemical companies,
laboratories, universities, healthcare providers, government agencies and public
and private research institutions. Many factors, including public policy
spending provisions, available resources and economic cycles have a significant
effect on the capital spending policies of these entities. These policies in
turn can have a significant effect on the demand for our products. For example,
a reduction in discretionary capital spending by petrochemical, oil and gas, and
mining companies, due to difficult market conditions, has adversely affected our
businesses operating in the process control industry. Similarly, softness in the
semiconductor industry has resulted in lower revenues at some of our businesses.
Also, our Thermedics Detection Inc. subsidiary has experienced lower demand for
its detection instruments as a result of a shift in the process of recycling
plastic containers in Europe, from sanitizing and reusing recyclables, to
melting and re-forming plastic containers.
FORWARD-LOOKING STATEMENTS
This prospectus and the information that we incorporate by reference into
this prospectus include statements that are subject to risks and uncertainties
and are based on the beliefs and assumptions of our and Thermo Instrument's
management, based on information currently available to each company's
management. When we use words such as "believes," "expects," "anticipates,"
"intends," "plans," "estimates," "should," "likely" or similar expressions, we
are making forward-looking statements. Forward-looking statements include the
information concerning possible or assumed future results of our and Thermo
Instrument's operations set forth:
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<PAGE> 20
- under "Summary," "Risk Factors," "Information About Thermo Electron And
Thermo Instrument," "Background To The Exchange Offer And The Merger,"
"Transactions With Related Parties" and "Pro Forma Consolidated Condensed
Financial Statements (Unaudited)" in this prospectus;
- under "Business" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" in our and Thermo Instrument's
Annual Reports on Form 10-K that we incorporate by reference into this
prospectus; and
- under "Management's Discussion and Analysis of Financial Condition and
Results of Operations" in our and Thermo Instrument's Quarterly Reports
on Form 10-Q that we incorporate by reference into this prospectus.
Forward-looking statements are not guarantees of performance. They involve
risks, uncertainties and assumptions. The future results and stockholder values
of Thermo Electron and Thermo Instrument may differ materially from those
expressed in the forward-looking statements. Many of the important factors that
will determine these results and values are beyond our ability to control or
predict. You should not put undue reliance on any forward-looking statements.
For a discussion of some of the factors that may cause actual results to differ
materially from those suggested by the forward-looking statements, you should
read carefully the section of this prospectus captioned "Risk Factors" that
starts on page 12.
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<PAGE> 21
INFORMATION ABOUT THERMO ELECTRON AND THERMO INSTRUMENT
THERMO ELECTRON
Thermo Electron Corporation, a Delaware corporation, develops, manufactures
and sells measurement and detection instruments that our customers use to
collect, monitor and analyze data. We conduct these businesses in significant
part through Thermo Instrument. We are in the process of spinning off our
business that serves the healthcare industry with a range of medical products
for diagnosis and monitoring, and our paper recycling and papermaking equipment
business. We are also in the process of selling various non-core businesses. We
plan to take Thermo Ecotek, our electric power generation business, private.
Although we no longer consider it a core business under our new strategy, we
expect to retain Thermo Ecotek after it is taken private while we continue to
evaluate how to best exit that business and create maximum value for our
stockholders. See "Background To The Exchange Offer And The Merger -- Our
Reorganization; Purpose And Reasons For The Exchange Offer And The Merger -- Our
Reorganization."
Our common stock is listed on the New York Stock Exchange under the symbol
"TMO." Our principal executive offices are located at 81 Wyman Street, P.O. Box
9046, Waltham, Massachusetts 02454-9046, and our telephone number is (781)
622-1000.
The name, business address, principal occupation, five-year employment
history and citizenship of each of our directors and executive officers is
included in Annex A to this prospectus. Except as set forth in Annex B to this
prospectus, none of our executive officers or directors purchased or sold any
shares of Thermo Instrument common stock during the 60-day period ended on June
26, 2000.
During the past five years, we have not been convicted in a criminal
proceeding, excluding traffic violations or similar misdemeanors, or been a
party to any judicial or administrative proceeding, except for any matters that
were dismissed without sanction or settlement, that resulted in a judgment,
decree or final order enjoining us from future violations of, or prohibiting
activities subject to, federal or state securities laws, or a finding of any
violation of federal or state securities laws.
We are subject to the disclosure requirements of the Exchange Act and are
required to file reports, proxy statements and other information with the SEC
relating to our business, financial condition and other matters. You can inspect
and copy, at prescribed rates, these reports, proxy statements and other
information at the offices of the SEC and the New York Stock Exchange. See
"Where You Can Find More Information."
THERMO INSTRUMENT
Thermo Instrument Systems Inc., a Delaware corporation, is a worldwide
leader in developing, manufacturing and marketing measurement instruments used
to monitor, collect and analyze information. Thermo Instrument's customers use
these systems for multiple applications in a range of industries, including
industrial processing, food and beverage production, life sciences research and
medical diagnostics.
Thermo Instrument common stock is listed on the American Stock Exchange
under the symbol "THI." Thermo Instrument's principal executive offices are
located at 81 Wyman Street, P.O. Box 9046, Waltham, Massachusetts 02454-9046,
and its telephone number is (781) 622-1000.
The name, business address, principal occupation, five-year employment
history and citizenship of each of Thermo Instrument's directors and executive
officers is included in Annex A to this prospectus. Except as set forth in Annex
B to this prospectus, none of Thermo Instrument's executive officers or
directors purchased or sold any shares of Thermo Instrument common stock during
the 60-day period ended on June 26, 2000.
Thermo Instrument is subject to the disclosure requirements of the Exchange
Act and is required to file reports, proxy statements and other information with
the SEC relating to its business, financial condition and other matters. You can
inspect and copy, at prescribed rates, these reports, proxy statements and other
information at the offices of the SEC and the American Stock Exchange. See
"Where You Can Find More Information."
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<PAGE> 22
BACKGROUND TO THE EXCHANGE OFFER AND THE MERGER
OUR REORGANIZATION; PURPOSE AND REASONS FOR THE EXCHANGE OFFER AND THE MERGER
Our Reorganization. On January 31, 2000, we announced that our board of
directors had authorized our management to proceed with a major reorganization
of our operations. The reorganization reflects a significant change in strategic
direction for us, both in terms of our business focus and operating structure.
- Until we adopted the reorganization plan, we had historically been
engaged in a diversified group of businesses, including the instruments
business. If we complete all aspects of the reorganization, we will focus
primarily on a variety of segments in the instruments business. The
businesses that we currently conduct through Thermo Instrument would be
central to this new focus.
- We have historically pursued a strategy of publicly offering minority
interests in some of our subsidiaries. These subsidiaries, in turn,
pursued the same strategy. Our management has reevaluated the benefits
and detriments of this corporate structure and concluded that we would
benefit if we reorganized our instrument businesses under a single parent
company without minority interests. To acquire the minority interests in
our subsidiaries, this new strategy includes exchanging shares of our
common stock for publicly held shares of the common stock of a number of
our subsidiaries, and tender offers and mergers by Thermo Instrument and
Thermedics involving publicly held shares of common stock of their
subsidiaries.
As part of our reorganization, we intend to spin-off or dispose of all of
our businesses other than the instrument business and our electric power
generation business. We do not expect to complete the spin-offs until the end of
2000 or early 2001. If you receive shares of our common stock in the exchange
offer or the merger and hold them at the time we complete the spin-offs, you
will receive shares of common stock of companies that will conduct our business
that serves the healthcare industry with a range of medical products for
diagnosis and monitoring and our paper recycling and papermaking equipment
business. See "Risk Factors -- Risks Related to Our Reorganization -- We are
unable to predict the liquidity or prospective performance of the common stock
of the companies that we intend to spin off." In addition, we will continue to
hold non-core assets until we sell them, which may not occur until after we
complete the proposed spin-offs. During the fiscal year ended January 1, 2000,
revenue from these non-core businesses and the businesses we are spinning off
was approximately $1.83 billion and net loss from the non-core businesses and
the businesses we are spinning off was approximately $111.5 million.
We plan to take Thermo Ecotek, our electric power generation business,
private. Although we no longer consider it a core business under our new
strategy, we expect to retain Thermo Ecotek after it is taken private while we
continue to evaluate how to best exit that business and create maximum value for
our stockholders.
As of June 26, 2000, the status of the reorganization was as follows:
- We had acquired for cash the publicly held minority equity interests in
13 of our subsidiaries;
- We had filed registration statements with the SEC relating to the
acquisitions of the publicly held minority equity interests in four of
our subsidiaries for shares of our common stock in mergers;
- We had filed registration statements with the SEC relating to the
acquisitions of the publicly held minority equity interests in two of our
subsidiaries, Thermo Instrument and Thermedics, for shares of our common
stock in exchange offers;
- We were seeking buyers for two of our publicly traded subsidiaries;
- We had filed a ruling request with the IRS relating to the two proposed
spin-offs; and
- We were evaluating our options for our subsidiary, Spectra-Physics
Lasers, Inc.
We currently expect that we will complete the acquisitions of minority interests
in our subsidiaries in the third quarter of 2000 and the spin-offs at the end of
2000 or early in 2001.
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<PAGE> 23
In addition, as of June 26, 2000, we had sold businesses with total 1999
revenues of approximately $246.4 million under our reorganization plan. We
received total gross proceeds, including both cash and non-cash consideration,
of approximately $235.7 million from these sales.
If we complete our reorganization as described above, we will not have any
public subsidiaries, unless we decide to keep Spectra-Physics Lasers as a public
subsidiary.
We have acquired the minority public interest in some of our subsidiaries
for cash, while in other cases we are issuing our common stock in exchange
offers or mergers. The primary factor in our decision whether to offer the
minority stockholders cash or our common stock was the outstanding principal
amount, if any, and due date, of that subsidiary's convertible debentures. In a
stock-for-stock merger or exchange offer, these debentures become convertible
into our common stock. If we take the subsidiary private in a cash transaction,
we must repay these debentures immediately. For example, if we had offered cash
in exchange for each outstanding share of Thermo Instrument common stock in this
exchange offer, we would have been required to repay an aggregate of $422.5
million in principal amount of Thermo Instrument's debentures.
Purpose of the Exchange Offer and the Merger. The purpose of this exchange
offer and the merger is to acquire the minority public interest in Thermo
Instrument as part of our overall reorganization. We are seeking through the
reorganization to:
- eliminate the complexity of our corporate structure; and
- focus on and integrate our instruments business.
We anticipate that our stockholders may realize the following benefits from
the exchange offer and the merger:
- By conducting our operations in a more coordinated manner with our other
instruments subsidiaries, we would achieve greater marketing, operating
and administrative efficiency.
- We would eliminate additional burdens on management associated with
public reporting and other tasks resulting from Thermo Instrument's
public company status. For example, Thermo Instrument's management would
no longer need to dedicate time and resources to stockholder and analyst
inquiries and investor and public relations.
- We would lower costs, particularly those associated with being a public
company. For example, as a privately-held entity, Thermo Instrument would
no longer be required to file quarterly, annual or other periodic reports
with the SEC or publish and distribute to its stockholders annual reports
and proxy statements. We anticipate that eliminating these costs,
including fees for an audit by an independent accounting firm and legal
fees, will result in savings of approximately $450,000 per year.
PROJECTED FINANCIAL DATA
Thermo Instrument does not, as a matter of course, make public forecasts or
projections as to future sales, earnings or other income statement data, cash
flows or balance sheet and financial position information. However, in
connection with the exchange offer and the merger, we had access to Thermo
Instrument's projections for the fourth quarter of fiscal 1999 and for fiscal
1999 and 2000. These projections were prepared by management of Thermo
Instrument in the course of its regular business planning.
We have included a summary of these Thermo Instrument projections below.
These projections do not reflect any of the effects of the exchange offer or the
merger or other changes that may in the future be appropriate concerning Thermo
Instrument and its assets, business, operations, properties, policies, corporate
structure, capitalization and management in light of the circumstances then
existing. We and Thermo Instrument believe that the assumptions were reasonable
at the time Thermo Instrument prepared the projections, given the information
known by our and Thermo Instrument's management.
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<PAGE> 24
Thermo Instrument did not prepare its projections for the fourth quarter of
fiscal 1999 and for fiscal 1999 and 2000 with a view toward public disclosure or
compliance with published guidelines of the SEC or the American Institute of
Certified Public Accountants regarding forward-looking information or generally
accepted accounting principles. Neither Thermo Instrument's independent
auditors, nor any other independent accountants, have compiled, examined or
performed any procedures with respect to the prospective financial information
contained in these projections nor have they expressed any opinion or given any
form of assurance on this information or its achievability. They assume no
responsibility for, and disclaim any association with, this prospective
financial information.
In preparing its projections for the fourth quarter of fiscal 1999 and for
fiscal 1999 and 2000, Thermo Instrument necessarily made numerous assumptions,
many of which are beyond our or Thermo Instrument's control and may prove not to
have been, or may no longer be, accurate. Except as otherwise indicated, this
information does not reflect revised prospects for Thermo Instrument's business,
changes in general business and economic conditions or any other transaction or
event that has occurred or that may occur and that Thermo Instrument did not
anticipate at the time it prepared this information. Accordingly, this
information is not necessarily indicative of current values or future
performance, which may be significantly more favorable or less favorable than as
set forth below, and you should not regard our including these projections in
this prospectus as a representation that they will be achieved.
THE THERMO INSTRUMENT PROJECTIONS FOR THE FOURTH QUARTER OF FISCAL 1999 AND
FOR FISCAL 1999 AND 2000 ARE NOT GUARANTEES OF PERFORMANCE. THEY INVOLVE RISKS,
UNCERTAINTIES AND ASSUMPTIONS. THE FUTURE FINANCIAL RESULTS AND STOCKHOLDER
VALUE OF THERMO INSTRUMENT MAY DIFFER MATERIALLY FROM THOSE EXPRESSED IN THESE
PROJECTIONS. MANY OF THE FACTORS THAT WILL DETERMINE THESE RESULTS AND VALUES
ARE BEYOND THERMO INSTRUMENT'S ABILITY TO CONTROL OR PREDICT. YOU SHOULD NOT
PLACE UNDUE RELIANCE ON THESE PROJECTIONS. THERMO INSTRUMENT'S FUTURE FINANCIAL
RESULTS MAY VARY MATERIALLY FROM THESE PROJECTIONS. NEITHER THERMO INSTRUMENT
NOR WE INTEND TO UPDATE OR REVISE THESE PROJECTIONS.
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<PAGE> 25
THERMO INSTRUMENT PROJECTIONS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOURTH FISCAL FISCAL
QUARTER YEAR YEAR
FISCAL 1999 1999 2000
----------- ---------- ----------
<S> <C> <C> <C>
SELECTED INCOME STATEMENT DATA:
Revenues............................................... $ 570,144 $2,092,567 $2,291,414
---------- ---------- ----------
Costs and Operating Expenses
Cost of revenues..................................... 304,207 1,128,745 1,209,458
Operating expenses................................... 199,199 743,024 825,402
Restructuring costs, net............................. 328 1,871 279
---------- ---------- ----------
503,734 1,873,640 2,035,139
---------- ---------- ----------
Operating Income....................................... 66,410 218,927 256,275
Interest Income........................................ 4,742 22,341 18,456
Interest Expense....................................... (13,454) (52,818) (54,834)
Equity in Loss of Affiliates........................... 2,343 (7,947) (646)
Gain on Sale of Investments............................ -- 1,116 --
Other Expense, Net..................................... (1) (3,387) (1)
---------- ---------- ----------
Income Before Provision for Income Taxes and Minority
Interest............................................. 60,040 178,232 219,250
Provision for Income Taxes............................. 25,218 77,230 92,084
Minority Interest Expense.............................. 5,326 16,402 20,219
---------- ---------- ----------
Net Income............................................. $ 29,496 $ 84,600 $ 106,947
========== ========== ==========
SELECTED BALANCE SHEET DATA:
Accounts Receivable, Net............................... $ 478,370 $ 478,370 $ 494,514
Inventories............................................ 338,660 338,660 326,721
Prepaid Income Taxes and Other Current Assets.......... 121,052 121,052 133,277
---------- ---------- ----------
Total Current Assets Excluding Cash and Investments.... 938,082 938,082 954,512
Property, Plant and Equipment:
Balance, Beginning of Period......................... 290,211 220,231 289,488
Additions............................................ 18,024 52,636 61,618
Depreciation Expense................................. (14,098) (48,555) (54,619)
Sales................................................ 299 70,124 78
---------- ---------- ----------
Balance, End of Period............................... 294,436 294,436 296,565
Cost in Excess of Net Assets of Acquired Companies..... 1,081,751 1,081,751 1,048,743
</TABLE>
CONFLICTS OF INTEREST
Thermo Electron. In setting the exchange ratio, our financial interest was
adverse to the financial interest of the public stockholders of Thermo
Instrument. We set the exchange ratio on our own and without any negotiations
with Thermo Instrument.
Our Directors. The members of our board of directors own, or hold options
to purchase, shares of our common stock and/or shares of common stock of Thermo
Instrument. These positions and equity interests presented these directors with
actual or potential conflicts of interest in determining the exchange ratio and
the other terms of the exchange offer and the merger.
Officers and Directors of Thermo Instrument. We set the exchange ratio on
our own and without negotiation with Thermo Instrument. The board of directors
of Thermo Instrument has formed a special
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<PAGE> 26
committee to evaluate the exchange offer and to make a recommendation to Thermo
Instrument's stockholders as to whether to accept or reject the exchange offer.
Mr. Polyvios C. Vintiadis, the only director of Thermo Instrument who is not an
employee of Thermo Electron or one of our affiliates, is the sole member of this
special committee.
The single member committee of the board of directors of Thermo Instrument
has recommended that Thermo Instrument stockholders accept the exchange offer
and tender their shares of Thermo Instrument common stock. This recommendation
is set forth in Thermo Instrument's Schedule 14D-9, dated May 5, 2000 and filed
with the SEC. YOU SHOULD CAREFULLY REVIEW THERMO INSTRUMENT'S SCHEDULE 14D-9
BEFORE DETERMINING WHETHER TO TENDER YOUR SHARES IN THE EXCHANGE OFFER OR TO
PURSUE YOUR APPRAISAL RIGHTS IN CONNECTION WITH THE MERGER.
In considering any position that Thermo Instrument has taken or may take in
the future with respect to the exchange offer and the merger, you should be
aware that the officers and several directors of Thermo Instrument have
interests in connection with the exchange offer and the merger that present them
with actual or potential conflicts of interest, as summarized below.
Officers and directors of Thermo Instrument who own shares of Thermo
Instrument common stock will receive shares of our common stock in the exchange
offer or the merger at the same exchange ratio and on the same terms as the
Thermo Instrument public stockholders.
Several members of the board of directors and executive officers of Thermo
Instrument are directors or officers of ours and of our other affiliates, as set
forth below:
- Mr. Earl R. Lewis, the chief executive officer, president and a director
of Thermo Instrument, is our chief operating officer, measurement and
detection, and a director of our affiliates FLIR Systems Inc., SpectRx
Inc. and Spectra-Physics Lasers, Inc.;
- Mr. Theo Melas-Kyriazi, the chief financial officer of Thermo Instrument,
is also our chief financial officer; and
- Mr. Vintiadis is also a director of our affiliates, Thermo TerraTech Inc.
and Spectra-Physics Lasers, Inc.
Consequently, these directors and officers receive or have received compensation
not only from Thermo Instrument but also from us and/or our other affiliates.
As of January 31, 2000, the members of the board of directors and executive
officers of Thermo Instrument owned a total of 168,043 shares of Thermo
Instrument common stock. These individuals would receive in exchange for their
shares of Thermo Instrument common stock a total of 142,836 shares of our common
stock, assuming that they tender all of their shares of Thermo Instrument common
stock in the exchange offer.
In addition, as of January 31, 2000, the members of the board of directors
and executive officers of Thermo Instrument held options to acquire a total of
1,270,168 shares of Thermo Instrument common stock, with exercise prices ranging
from $4.88 to $27.89. We would assume these options and convert them into
options to acquire shares of our common stock on the same terms as all of the
other holders of Thermo Instrument options in connection with the exchange offer
and the merger. See "-- Treatment of Thermo Instrument Options."
As of January 1, 2000, Mr. Vintiadis had accumulated deferred units
representing 5,590 shares of Thermo Instrument common stock under Thermo
Instrument's deferred compensation plan for directors. These units would be
converted into the right to receive 4,751.5 shares of our common stock in the
merger. See "-- Treatment of Thermo Instrument Deferred Compensation Plan for
Directors."
Indemnification Agreements. We have entered into separate indemnification
agreements with each of Thermo Instrument's executive officers and directors,
including Mr. Vintiadis, the member of the single member committee. These
agreements require us to indemnify and advance expenses to the indemnified
director or officer if he or she, by reason of his or her status as a director
or officer of Thermo Instrument,
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<PAGE> 27
or service as a director, officer or fiduciary of another enterprise at our
request, is made or threatened to be made a party to any threatened, pending or
completed action, suit or other proceeding, whether civil, criminal,
administrative or investigative. We are only required to provide these benefits
if the director or officer seeking indemnification acted in good faith and in a
manner he or she reasonably believed to be in or not opposed to our best
interests, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his or her conduct was unlawful. We are required to
provide indemnification to the maximum extent permitted by Delaware law in the
case of any threatened, pending or completed action, suit or proceeding by or in
our right.
We entered into these indemnification agreements with Thermo Instrument's
officers and directors so that the indemnified officers and directors would have
supplemental protection in the event that indemnification directly from Thermo
Instrument was not available, either because of legal restrictions or because
Thermo Instrument did not have the funds to cover the obligation.
THE MERGER
If we successfully complete the exchange offer, we plan to cause Thermo
Instrument to merge into us in a so-called "short-form" merger. This merger
would occur as promptly as practicable after completion of the exchange offer.
Under the Delaware General Corporation Law, if we own at least 90% of the
outstanding shares of Thermo Instrument common stock, we would have the power to
approve, adopt and complete the merger without a vote of Thermo Instrument's
stockholders or board of directors. Our stockholders would own all of the
outstanding shares of the surviving corporation after the merger.
On the effective date of the merger, each outstanding share of Thermo
Instrument common stock, other than shares of Thermo Instrument common stock
held by us or Thermo Instrument and shares of Thermo Instrument common stock
held by stockholders, if any, who are entitled to and perfect their appraisal
rights under Section 262 of the Delaware General Corporation Law, would be
cancelled and converted into the right to receive 0.85 shares of our common
stock.
EFFECTS OF THE EXCHANGE OFFER AND THE MERGER
General. Upon completion of the exchange offer and the merger, we would
have complete control over the conduct of Thermo Instrument's business and would
have a 100% interest in the net book value and net earnings of Thermo
Instrument. In addition, we would receive the benefit of complete control over
any future increases in the value of Thermo Instrument and would bear the
complete risk of any losses incurred in the operation of Thermo Instrument and
any decrease in the value of Thermo Instrument. Our ownership of Thermo
Instrument, before the transactions contemplated by the exchange offer and the
merger, totaled approximately 88.5%.
Possible Effect of the Exchange Offer on the Market for Thermo Instrument
Common Stock. After the completion of the exchange offer and before the
effective date of the merger, our exchange of shares of our common stock for
shares of Thermo Instrument common stock pursuant to the exchange offer would
reduce the number of shares of Thermo Instrument common stock that might
otherwise trade publicly and may reduce the number of holders of shares of
Thermo Instrument common stock. These exchanges could adversely affect the
liquidity and market value of the remaining shares of Thermo Instrument common
stock held by the public.
American Stock Exchange Listing. If we complete the exchange offer and the
merger, the shares of Thermo Instrument common stock would not meet the
requirements for continued listing on the American Stock Exchange and would be
delisted. Assuming that the merger occurs shortly after the completion of the
exchange offer, we do not expect the American Stock Exchange to delist the
shares of Thermo Instrument common stock until after the effective date of the
merger. However, as discussed below, it is possible that the American Stock
Exchange could take this action.
The shares of Thermo Instrument common stock may not meet the quantitative
requirements for continued listing on the American Stock Exchange following the
closing of the exchange offer and prior to
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<PAGE> 28
the effective date of the merger. Whether the shares of Thermo Instrument common
stock meets those requirements will depend upon:
- the aggregate market value and the number of shares of Thermo Instrument
common stock that we do not exchange for shares of our common stock
pursuant to the exchange offer; and
- the number of Thermo Instrument public stockholders who are not
affiliated with us.
To be listed on the American Stock Exchange, an issuer must have at least
200,000 publicly held shares, held by at least 300 stockholders, with a market
value of at least $1,000,000 and have stockholders' equity of at least
$2,000,000 or $4,000,000, depending on profitability levels during the issuer's
four most recent fiscal years.
If the shares of Thermo Instrument common stock no longer meet the
requirements for listing on the American Stock Exchange, it is possible that the
shares would continue to trade in the over-the-counter market before the
effective date of the merger and that price or other quotations might still be
available from other sources. The extent of the public market for the shares of
Thermo Instrument common stock and the availability of such quotations would,
however, depend upon such factors as:
- the number of holders and/or the aggregate market value of such shares of
Thermo Instrument common stock remaining at the time;
- the interest in maintaining a market in those shares of Thermo Instrument
common stock on the part of securities firms; and
- the possible termination of registration of shares of Thermo Instrument
common stock under the Exchange Act, as described below.
We cannot predict whether a reduction in the number of shares of Thermo
Instrument common stock that might otherwise trade publicly would have an
adverse or beneficial effect on the market price for or marketability of the
shares of Thermo Instrument common stock or whether it would cause future market
prices to be greater or less than the price paid in the exchange offer and the
merger.
Exchange Act Registration. The shares of Thermo Instrument common stock
are currently registered under the Exchange Act. If we complete the exchange
offer and the merger, Thermo Instrument's reporting obligations under the
Exchange Act would terminate.
Before the effective date of the merger, the exchange of shares of Thermo
Instrument common stock for shares of our common stock pursuant to the exchange
offer may result in the shares of Thermo Instrument common stock becoming
eligible for deregistration under the Exchange Act. Thermo Instrument may apply
to the SEC for termination of the registration of its common stock if the common
stock is not listed on a national securities exchange and there are fewer than
300 record holders of the shares of Thermo Instrument common stock. See
"-- American Stock Exchange Listing."
If Thermo Instrument terminates the registration of its common stock under
the Exchange Act:
- Thermo Instrument would no longer be required to provide its stockholders
with annual, quarterly and other reports under the Exchange Act;
- Thermo Instrument would no longer be required to comply with other
provisions of the Exchange Act, such as the short-swing profit recovery
provisions of Section 16(b), the requirement of furnishing a proxy
statement in connection with stockholders' meetings pursuant to Section
14(a) and the requirements of Rule 13e-3 under the Exchange Act with
respect to "going private" transactions;
- "affiliates" of Thermo Instrument and persons holding "restricted
securities" of Thermo Instrument may be deprived of the ability to
dispose of their securities pursuant to Rule 144 under the Securities
Act; and
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<PAGE> 29
- the shares of Thermo Instrument common stock would no longer be "margin
securities" or eligible for listing on the American Stock Exchange.
We presently intend to cause Thermo Instrument to terminate the
registration of the shares of Thermo Instrument common stock under the Exchange
Act as soon after the completion of the exchange offer or the merger as the
requirements for termination of registration are met.
Margin Regulations. The shares of Thermo Instrument common stock are
currently "margin securities" under the rules of the Board of Governors of the
Federal Reserve System. As a result, brokers are allowed to extend credit, known
as purpose loans, on the collateral of shares of Thermo Instrument common stock
for the purpose of buying, carrying or trading in securities. If we complete the
exchange offer and the merger, shares of Thermo Instrument common stock would no
longer be "margin securities." Following the exchange of shares of Thermo
Instrument common stock pursuant to the exchange offer and before the effective
date of the merger, depending upon factors such as the number of record holders
of the shares of Thermo Instrument common stock and the number and market value
of publicly held shares of Thermo Instrument common stock, the shares of Thermo
Instrument common stock might no longer constitute "margin securities" for
purposes of the Federal Reserve Board's margin regulations and you could not
then use your shares of Thermo Instrument common stock as collateral for purpose
loans made by brokers. In addition, if Thermo Instrument terminated the
registration of shares of its common stock under the Exchange Act, the shares of
its common stock would no longer constitute "margin securities."
Treatment of Thermo Instrument Options. Thermo Instrument has issued
options to acquire shares of its common stock pursuant to Thermo Instrument's
Equity Incentive Plan, Directors Stock Option Plan and Employees Equity
Incentive Plan. In connection with the exchange offer and the merger, we would
assume Thermo Instrument's plans and each outstanding option under these plans.
Each option that we assume would continue to have, and be subject to,
substantially the same terms and conditions applicable to the option immediately
before the effective date of the merger, except that:
- each option would be exercisable, or would become exercisable in
accordance with its terms, for that number of whole shares of our common
stock equal to the product of the number of shares of Thermo Instrument
common stock that were issuable upon exercise of the option immediately
before the effective date of the merger multiplied by the exchange ratio,
rounded down to the nearest whole number of shares of our common stock;
and
- the per share exercise price for the shares of our common stock issuable
upon exercise of such assumed option would be equal to the quotient
determined by dividing the exercise price per share at which the option
was exercisable immediately before the effective date of the merger by
the exchange ratio, rounded up to the nearest whole cent.
Treatment of Thermo Instrument Employees' Stock Purchase Plan. In
connection with the exchange offer and the merger, we would assume each
outstanding option to purchase shares of Thermo Instrument common stock under
Thermo Instrument's Employees' Stock Purchase Plan. Each stock option under the
plan that we assume would continue to have, and be subject to, the same terms
and conditions as set forth in the plan immediately before the effective date of
the merger, except that:
- the assumed stock option would be exercisable, or would become
exercisable in accordance with its terms, for that number of whole shares
of our common stock equal to the product of the number of shares of
Thermo Instrument common stock that were issuable upon exercise of the
assumed stock option immediately before the effective date of the merger
multiplied by the exchange ratio, rounded down to the nearest whole
number of shares of our common stock;
- the purchase price per share of our common stock would be the lower of:
-- 85% of the per share market value of the shares of Thermo Instrument
common stock on the grant date of the assumed stock option divided by
the exchange ratio, with the resulting price rounded up to the
nearest whole cent; and
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-- 85% of the per share market value of our common stock as of the
exercise date of the assumed stock option; and
- the $25,000 limit under Section 9.2(i) of the plan would be applied by
taking into account our assumption of the stock options in accordance
with Section 423(b)(8) of the Internal Revenue Code of 1986 and
regulations under that section.
Treatment of Thermo Instrument Deferred Compensation Plan for
Directors. In connection with the exchange offer and the merger, we would
assume Thermo Instrument's deferred compensation plan for directors and the
units for Thermo Instrument common stock outstanding under the plan would be
converted into units for our common stock at the exchange ratio. Based on the
units accumulated on January 1, 2000, Mr. Vintiadis would receive units for
4,751.5 shares of our common stock.
Treatment of Thermo Instrument Debentures. From and after the effective
date of the merger, we would assume Thermo Instrument's 4% convertible
subordinated debentures due January 2005 and Thermo Instrument's 4.5% senior
convertible debentures due October 2003. These debentures would be convertible
into shares of our common stock, instead of Thermo Instrument common stock. As
of May 31, 2000, a total of $250 million principal amount of the 4% debentures
was outstanding and a total of $172.5 million principal amount of the 4.5%
debentures was outstanding. At that date, the 4% debentures were convertible
into a total of 7,012,623 shares of Thermo Instrument common stock at a
conversion price of $35.65 per share and the 4.5% debentures were convertible
into a total of 5,006,385 shares of Thermo Instrument common stock at a
conversion price of $34.456 per share. Holders of Thermo Instrument debentures
would not have the right to require Thermo Instrument to redeem their debentures
as a result of the merger. After the merger, the 4% debentures would be
initially convertible into a total of 5,960,729 shares of our common stock at a
conversion price of $41.94 per share and the 4.5% debentures would be initially
convertible into a total of 4,255,427 shares of our common stock at a conversion
price of $40.54 per share.
Accounting Treatment. The exchange offer and the merger would be accounted
for as the acquisition of a minority interest by us using the purchase method of
accounting.
Tax Consequences. For federal income tax purposes, your receipt of shares
of our common stock pursuant to the exchange offer or the merger would be
tax-free. However, you would be taxed upon your receipt of cash in lieu of
fractional shares of our common stock in the exchange offer or the merger. See
"Federal Income Tax Consequences."
CONDUCT OF THERMO INSTRUMENT'S BUSINESS AFTER THE OFFER AND THE MERGER
Following our reorganization, we plan to retain Thermo Instrument as part
of our core measurement and detection instruments business. We intend to
evaluate ways in which we can more efficiently integrate and operate our
instruments business, including Thermo Instrument's business. We do not
currently have any commitment or agreement for the sale of all or any material
portion of Thermo Instrument's business.
Except as otherwise described in this prospectus, we have not as of the
date of this prospectus approved any specific plans or proposals for:
- any extraordinary corporate transaction involving Thermo Instrument's
business after the completion of the exchange offer and the merger; or
- any sale or transfer of a material amount of assets currently held by
Thermo Instrument after the completion of the exchange offer and the
merger.
CONDUCT OF THERMO INSTRUMENT'S BUSINESS IF THE OFFER IS NOT COMPLETED
If we do not complete the exchange offer because, on the date the exchange
offer expires, we do not own at least 90% of Thermo Instrument's outstanding
shares or because another condition to the exchange
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offer is not satisfied or waived, we expect that Thermo Instrument's current
management will continue to operate Thermo Instrument's business substantially
as presently operated. In that event, we may consider:
- engaging in open market or privately negotiated purchases of shares of
Thermo Instrument common stock to increase our ownership of shares of
Thermo Instrument common stock to at least 90% of the outstanding shares
of Thermo Instrument common stock;
- proposing that we and Thermo Instrument enter into a long-form merger
agreement, which would require the consent of Thermo Instrument's board
of directors, and vote all of our shares of Thermo Instrument common
stock in favor of such merger; or
- keeping outstanding the public minority interest in Thermo Instrument, in
which case the Thermo Instrument public stockholders would not receive
shares of our common stock for their shares of Thermo Instrument common
stock and the trading price for the shares of Thermo Instrument common
stock could decline, including to a price that is less than the value of
the shares of our common stock that we propose to issue in exchange for
shares of Thermo Instrument common stock in the exchange offer and the
merger.
If we were to pursue any of these alternatives, it may take considerably
longer for you to receive any consideration for your shares of Thermo Instrument
common stock, other than through sales in the open market, than if you had
tendered your shares in the exchange offer. Any such transaction may result in
proceeds per share to you that are more or less than the value of the shares of
our common stock that we propose to issue in exchange for shares of Thermo
Instrument common stock in the exchange offer and the merger.
THE EXCHANGE OFFER
TERMS OF THE EXCHANGE OFFER; EXPIRATION OF THE EXCHANGE OFFER
Offer For All Outstanding Shares. We are offering to acquire all the
shares of Thermo Instrument common stock, par value $.10 per share, outstanding
on the expiration date that we do not currently own.
Exchange Ratio. We are offering to exchange 0.85 shares of our common
stock for each outstanding share of common stock of Thermo Instrument that
Thermo Instrument stockholders validly tender and do not properly withdraw.
Fractional Shares. We will not issue fractional shares of our common stock
in the exchange offer or the merger. Instead, we will pay an amount in cash
equal to $19.1875 for each whole share of our common stock in lieu of any
fractional share that we would otherwise issue to you.
Withdrawal Rights. You may withdraw shares that you have tendered at any
time on or before June 29, 2000. If we extend the exchange offer, all shares of
Thermo Instrument common stock that you have previously tendered and not
properly withdrawn would remain subject to the exchange offer, although you
would have the right to withdraw your shares of Thermo Instrument common stock.
Unless we accept your shares for exchange on or before June 22, 2000, you may
also withdraw shares that you have tendered and which we have not accepted for
exchange at any time after that date. See "-- Withdrawal Rights."
Expiration Date. This exchange offer will expire at 12:00 midnight, New
York City time, on Thursday, June 29, 2000, unless we, in our sole discretion,
extend the period during which the exchange offer is open.
Extension of Expiration Date. If allowed by the rules of the SEC, we may
extend the period during which the exchange offer is open. We may exercise this
right in our sole discretion at any time and for any reason, including the
failure to satisfy any of the conditions specified below under "-- Conditions Of
The Offer." We can extend the period during which the exchange offer is open by
providing oral or written notice to American Stock Transfer & Trust Company, the
depositary for the exchange offer. If we extend
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the period during which the exchange offer is open, we will make an announcement
no later than 9:00 a.m., New York City time, on the next business day after the
previously scheduled expiration of the exchange offer. Any extension would delay
our acceptance for exchange and the actual exchange of any shares of Thermo
Instrument common stock that you tender.
Termination, Amendment and Waiver. If allowed by the rules of the SEC, we
may also, in our sole discretion, at any time before the exchange offer expires:
- terminate the exchange offer and not accept for exchange, or exchange,
any shares of Thermo Instrument common stock if any of the conditions
described in "-- Conditions Of The Offer" has not been satisfied or upon
the occurrence and during the continuance of any of the events specified
in "-- Conditions Of The Offer" or
- waive any condition or amend the exchange offer in any respect,
in each case by giving oral or written notice of termination, waiver or
amendment to the depositary and by making a public announcement thereof. If we
terminate or withdraw the exchange offer, we will promptly return any shares of
Thermo Instrument common stock that you have tendered. We may not delay
acceptance for exchange, or the exchange, of any shares of Thermo Instrument
common stock upon the occurrence of any of the conditions specified in
"-- Conditions Of The Offer" without extending the period during which the
exchange offer is open.
If the number of shares of Thermo Instrument common stock tendered is
insufficient to satisfy the minimum tender condition or any other condition
specified in "-- Conditions Of The Offer" is not fulfilled by the expiration of
the exchange offer, we may:
- decline to exchange shares of our common stock for any of the shares of
Thermo Instrument common stock tendered, return to you all shares of
Thermo Instrument common stock that you tendered and terminate the
exchange offer;
- extend the exchange offer and retain all tendered shares of Thermo
Instrument common stock until the expiration of the exchange offer, as
extended, subject to the terms and conditions of the exchange offer,
including your rights to withdraw your shares of Thermo Instrument common
stock; or
- waive or amend the condition and, subject to complying with the rules of
the SEC, accept for exchange and exchange shares of our common stock for
all shares of Thermo Instrument common stock validly tendered.
We will publicly announce any extension, termination or amendment of the
exchange offer as promptly as practicable. Without limiting the manner in which
we may choose to make any public announcement, except as provided by applicable
law, including Rules 14d-4(c), 14d-6(d) and 14e-1 under the Exchange Act, which
require that material changes be promptly disseminated to holders of shares of
Thermo Instrument common stock, we will have no obligation to publish, advertise
or otherwise communicate any public announcement other than by issuing a release
to the Dow Jones News Service.
Material Change to Exchange Offer. If we make a material change in the
terms of the exchange offer or the information concerning the exchange offer, or
waive a material condition of the exchange offer, we will disseminate additional
exchange offer materials, including by public announcement as described above,
and extend the exchange offer to the extent required by Rules 14d-4(d), 14d-6(d)
and 14e-1 under the Exchange Act. The minimum period during which we will keep
the exchange offer open following material changes in the terms of the exchange
offer or information concerning the exchange offer, other than a change in
price, a change in percentage of securities sought or a change in any dealer's
soliciting fee, will depend upon the facts and circumstances, including the
relative materiality of the changes.
With respect to a change in price or, subject to limitations, a change in
the percentage of securities sought or a change in any dealer's soliciting fee,
we will keep the exchange offer open for a minimum ten
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business day period from the date of the change to allow for adequate
dissemination to stockholders. Accordingly, if, before the exchange offer
expires, we:
- decrease the number of shares of Thermo Instrument common stock sought in
the exchange offer,
- increase the consideration offered in the exchange offer, or
- add a dealer's soliciting fee,
and if the exchange offer is scheduled to expire at any time earlier than the
period ending on the tenth business day from the date that we first publish,
send or give to stockholders notice of such increase, decrease or addition, we
will extend the exchange offer at least until the ten business day period
expires. For purposes of the exchange offer, a "business day" means any day
other than a Saturday, Sunday or federal holiday and consists of the time period
from 12:01 a.m. through 12:00 midnight, New York City time.
Mailing of the Prospectus. Thermo Instrument has provided us with its
stockholder list and security position listings for the purpose of disseminating
materials relating to the exchange offer to holders of shares of Thermo
Instrument common stock. We mailed a preliminary form of this prospectus and a
related letter of transmittal and other relevant materials to record holders of
shares of Thermo Instrument common stock on April 24, 2000. We also furnished
those materials to brokers, dealers, commercial banks, trust companies and
similar persons whose names, or the names of whose nominees, appeared on Thermo
Instrument's stockholder list or who were listed as participants in a clearing
agency's security position listing for subsequent transmittal to beneficial
owners of shares of Thermo Instrument common stock.
Subsequent Offering Period. Although we do not currently intend to, we may
elect to provide a subsequent offering period. Any subsequent offering period
would last between three and 20 business days after our acceptance of Thermo
Instrument shares in the exchange offer. We will comply with the requirements
under Exchange Act Rule 14d-11 if we elect to provide a subsequent offering
period. You will not have the right to withdraw any Thermo Instrument shares
that you tender during any subsequent offering period.
ACCEPTANCE FOR EXCHANGE AND EXCHANGE OF SHARES
Timing of Exchange of Shares. Upon the terms and subject to the conditions
of this exchange offer, including, if we extend or amend the exchange offer, the
terms and conditions of any such extension or amendment, we will accept for
exchange, and will exchange for shares of our common stock, all shares of Thermo
Instrument common stock validly tendered before the exchange offer expires and
not properly withdrawn, including shares of Thermo Instrument common stock
validly tendered and not withdrawn during any extension of the exchange offer,
if we extend the exchange offer, subject to the terms and conditions of the
extension, promptly after the expiration of the exchange offer. In addition,
subject to complying with Rule 14e-1 under the Exchange Act, we may, in our sole
discretion, delay the acceptance for exchange or exchange of shares of Thermo
Instrument common stock to comply, in whole or in part, with any law.
In all cases, we will exchange shares of our common stock for shares of
Thermo Instrument common stock tendered and accepted for exchange pursuant to
the exchange offer only after timely receipt by the depositary of:
- certificates evidencing shares of Thermo Instrument common stock or
timely confirmation, known as a book-entry confirmation, of a book-entry
transfer of shares of Thermo Instrument common stock into the
depositary's account at The Depository Trust Company pursuant to the
procedures set forth below under "-- Procedures For Accepting The Offer
And Tendering Shares;"
- a properly completed and duly executed letter of transmittal, or a
facsimile of that document, with any required signature guarantees, or an
agent's message in connection with a book-entry transfer; and
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- any other documents required by the letter of transmittal.
Accordingly, we may issue shares of our common stock to tendering stockholders
at different times if delivery of their shares of Thermo Instrument common stock
and other required documents occurs at different times.
Agent's Message. The term "agent's message" means a message transmitted by
The Depository Trust Company to, and received by, the depositary and forming a
part of a book-entry confirmation, which states that The Depository Trust
Company has received an express acknowledgment from the participant in The
Depository Trust Company tendering the shares of Thermo Instrument common stock
which are the subject of the book-entry confirmation, that the participant has
received and agrees to be bound by the terms of the letter of transmittal and
that we may enforce the agreement against such participant.
Acceptance of Shares. For purposes of the exchange offer, we will have
accepted for exchange, and thereby exchanged, shares of our common stock for
shares of Thermo Instrument common stock validly tendered and not properly
withdrawn if, as and when we give oral or written notice to the depositary of
our acceptance for exchange of such shares of Thermo Instrument common stock
pursuant to the exchange offer. Upon the terms and subject to the conditions of
the exchange offer, we will issue shares of our common stock in exchange for
shares of Thermo Instrument common stock that we accept for exchange by
depositing the total number of shares of our common stock issuable in exchange
for shares of Thermo Instrument common stock with the depositary.
The depositary will act as agent for tendering stockholders for the purpose
of receiving shares of our common stock and transmitting these shares to
stockholders whose shares of Thermo Instrument common stock we have accepted for
exchange. UNDER NO CIRCUMSTANCES WILL WE PAY INTEREST ON THE MARKET VALUE OF
SHARES OF OUR COMMON STOCK OR ON THE AMOUNT OF ANY CASH PAYABLE TO A TENDERING
STOCKHOLDER IN LIEU OF FRACTIONAL SHARES OF OUR COMMON STOCK, REGARDLESS OF ANY
EXTENSION OF THE EXCHANGE OFFER OR DELAY IN MAKING SUCH EXCHANGE. When we
deposit shares of our common stock with the depositary for the purpose of
issuing these shares to validly tendering stockholders, our obligation to make
such exchange will be satisfied and from then on tendering stockholders must
look solely to the depositary for the shares of our common stock owed to them by
reason of the acceptance for exchange of shares of Thermo Instrument common
stock pursuant to the exchange offer.
Shares Not Accepted for Exchange. If for any reason we do not accept any
shares of Thermo Instrument common stock that you tender pursuant to the terms
and conditions of the exchange offer, or if you submit share certificates
representing more shares of Thermo Instrument common stock than you are
tendering, we will return share certificates representing shares of Thermo
Instrument common stock that we do not accept for exchange or that you do not
tender, without expense, to you. In the case of shares of Thermo Instrument
common stock that you tender by book-entry transfer, we will credit your account
at The Depository Trust Company for any shares that we do not accept for
exchange as promptly as practicable following expiration or termination of the
exchange offer.
Other Terms. If we increase the exchange ratio or otherwise increase the
consideration in the exchange offer before the exchange offer expires, we will
apply the higher rate or increased consideration to all shares of Thermo
Instrument common stock that you tender in the exchange offer, whether or not
you tendered or we exchanged such shares of Thermo Instrument common stock
before we increased the in exchange ratio or other consideration.
We may transfer or assign to one or more of our affiliates our right to
exchange shares of our common stock for shares of Thermo Instrument common stock
tendered pursuant to the exchange offer. We may exercise this right in whole or
in part from time to time. If we exercise this right, we will still be required
to comply with our obligations under the exchange offer. Your right to receive
shares of our common stock in exchange for your shares of Thermo Instrument
common stock that you validly tender and that we accept for exchange pursuant to
the exchange offer will not be prejudiced by any such transfer or assignment by
us.
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PROCEDURES FOR ACCEPTING THE OFFER AND TENDERING SHARES
General. Except as set forth below, for you to validly tender your shares
of Thermo Instrument common stock pursuant to the exchange offer, the depositary
must receive either:
- your letter of transmittal, or a facsimile of your letter of transmittal,
properly completed and duly executed, together with any required
signature guarantees, or
- an agent's message in connection with a book-entry delivery of shares of
Thermo Instrument common stock,
together with any other documents required by the letter of transmittal. The
depositary must receive these documents at one of its addresses set forth on the
back cover of this prospectus before the exchange offer expires. In addition,
either
- the depositary must receive share certificates evidencing your tendered
shares of Thermo Instrument common stock at one of the addresses set
forth on the back cover of this prospectus or you must tender your shares
of Thermo Instrument common stock pursuant to the procedures for
book-entry transfer set forth below, and the depositary must receive a
book-entry confirmation, in each case before the exchange offer expires;
or
- you must comply with the guaranteed delivery procedures set forth below.
We will not accept alternative, conditional or contingent tenders. We will
not accept for exchange fractional shares of Thermo Instrument common stock. By
execution of the letter of transmittal included with this prospectus, or a
facsimile thereof, you will waive any right to receive any notice of the
acceptance for exchange of your shares of Thermo Instrument common stock.
THE METHOD OF DELIVERY OF SHARE CERTIFICATES, THE LETTER OF TRANSMITTAL AND
ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH THE DEPOSITORY TRUST
COMPANY, IS AT YOUR SOLE OPTION AND RISK. EXCEPT AS OTHERWISE PROVIDED UNDER
THIS HEADING "PROCEDURES FOR ACCEPTING THE OFFER AND TENDERING SHARES," WE WILL
TREAT YOUR SHARE CERTIFICATES, LETTER OF TRANSMITTAL AND OTHER REQUIRED
DOCUMENTS AS DELIVERED ONLY WHEN THEY ARE ACTUALLY RECEIVED BY THE DEPOSITARY.
IF YOU USE THE MAIL FOR DELIVERY, WE RECOMMEND THAT YOU USE REGISTERED MAIL WITH
RETURN RECEIPT REQUESTED, PROPERLY INSURED. IN ALL CASES, YOU SHOULD ALLOW
SUFFICIENT TIME TO ENSURE TIMELY DELIVERY.
Book-Entry Transfer. Within two business days after the commencement date
of the exchange offer, the depositary requested that The Depository Trust
Company establish an account with respect to the shares of Thermo Instrument
common stock for purposes of the exchange offer, and The Depository Trust
Company did so. Any financial institution that is a participant in the system of
The Depository Trust Company may make book-entry delivery of your shares of
Thermo Instrument common stock by causing The Depository Trust Company to
transfer your shares into the depositary's account at The Depository Trust
Company in accordance with The Depository Trust Company's procedures for such
transfer. Although you may deliver your shares of Thermo Instrument common stock
through book-entry transfer into the depositary's account at The Depository
Trust Company, the depositary must receive:
- your letter of transmittal, or a facsimile of your letter of transmittal,
properly completed and duly executed, together with any required
signature guarantees, or an agent's message, and
- any other documents required by the letter of transmittal,
at one of its addresses set forth on the back cover of this prospectus before
the exchange offer expires for you to validly tender your shares of Thermo
Instrument common stock pursuant to the exchange offer, or you must comply with
the guaranteed delivery procedures described below.
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DELIVERY OF DOCUMENTS TO THE DEPOSITORY TRUST COMPANY IN ACCORDANCE WITH
THE DEPOSITORY TRUST COMPANY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE
DEPOSITARY.
Signature Guarantees. Except as described below, a firm that is a bank,
broker, dealer, credit union, savings association or other entity which is a
member in good standing of:
- the Securities Transfer Agents Medallion Program,
- the Stock Exchanges' Medallion Program, or
- the New York Stock Exchange, Inc. Medallion Signature Program
must guarantee signature on your letter of transmittal. Each firm that is a
member of these medallion programs is referred to in this prospectus as an
"eligible institution." We will not require a signature guarantee on your letter
of transmittal if:
- you are the registered holder of shares of Thermo Instrument common stock
and do not complete either the box entitled "Special Delivery
Instructions" or the box entitled "Special Issuance Instructions" on your
letter of transmittal; or
- you tender shares of Thermo Instrument common stock for the account of an
eligible institution.
For more information regarding these procedures, you should review Instruction 1
of the letter of transmittal.
If your share certificates are registered in the name of a person other
than the person who signs the letter of transmittal, or if you direct us to make
payment or to return your share certificates for exchanged shares of Thermo
Instrument common stock to a person other than the registered holders, then the
tendered share certificates must be endorsed or accompanied by appropriate stock
powers signed exactly as the names of the registered holders appear on the share
certificates, with the signatures on the share certificates or stock powers
guaranteed by an eligible institution as provided above and in the letter of
transmittal. See Instructions 1 and 5 of the letter of transmittal.
Guaranteed Delivery. If you wish to tender shares of Thermo Instrument
common stock pursuant to the exchange offer and your share certificates are not
immediately available or you cannot deliver all of the required documents to the
depositary before the exchange offer expires or you cannot comply with the
procedures for book-entry transfer on a timely basis, you may still tender your
shares of Thermo Instrument common stock, so long as all of the following
conditions are satisfied:
- you make your tender by or through an eligible institution;
- the depositary receives a properly completed and duly executed notice of
guaranteed delivery, substantially in the form provided with this
prospectus, as provided below before the exchange offer expires; and
- the depositary receives within three American Stock Exchange trading days
after the date of execution of the notice of guaranteed delivery the
share certificates, or a book-entry confirmation, for your tendered
shares of Thermo Instrument common stock, in proper form for transfer, in
each case together with a properly completed and duly executed letter of
transmittal, or a facsimile of a properly completed and duly executed
letter of transmittal, with any required signature guarantees or, in the
case of a book-entry transfer, an agent's message and any other documents
required by the letter of transmittal.
You may deliver the notice of guaranteed delivery by hand or transmit it by
telegram, facsimile transmission or mail to the depositary. You must include a
guarantee by an eligible institution in the form set forth in the notice of
guaranteed delivery.
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Timing for Exchange. In all cases, we will exchange shares of Thermo
Instrument common stock that you have tendered and we have accepted for exchange
pursuant to the exchange offer only after timely receipt by the depositary of:
- share certificates for Thermo Instrument shares, or book-entry
confirmation of the transfer of the shares of Thermo Instrument common
stock into the depositary's account at The Depository Trust Company;
- a properly completed and duly executed letter of transmittal, or a
facsimile of a properly completed and duly executed letter of
transmittal, together with any required signature guarantees or, in the
case of a book-entry transfer, an agent's message; and
- any other documents required by the letter of transmittal.
Accordingly, tendering stockholders of Thermo Instrument may receive shares of
our common stock at different times depending upon when share certificates or
book-entry confirmations for their shares of Thermo Instrument common stock are
received by the depositary.
Backup Federal Income Tax Withholding. Under U.S. federal income tax laws,
the depositary may be required to withhold 31% of the amount of any cash
payments made to you in lieu of fractional shares of our common stock. To
prevent backup federal income tax withholding with respect to any reportable
cash payments made to you in the exchange offer, you must provide the depositary
with your correct taxpayer identification number and certify that you are not
subject to backup federal income tax withholding by completing the Substitute
Form W-9 included in the letter of transmittal. See Instruction 9 of the letter
of transmittal.
Appointment as Proxy. By executing the letter of transmittal, you
irrevocably appoint our designees as your attorneys-in-fact and proxies in the
manner set forth in the letter of transmittal, each with full power of
substitution with respect to any shares of Thermo Instrument common stock you
tendered, and with respect to any and all other shares of Thermo Instrument
common stock or other securities issued or issuable in respect of such shares of
Thermo Instrument common stock on or after April 24, 2000. This appointment will
not be effective until we accept your tendered shares of Thermo Instrument
common stock for exchange and deposit shares of our common stock as the exchange
consideration with the depositary. All such proxies will be irrevocable and
coupled with an interest in your tendered shares of Thermo Instrument common
stock. When this appointment becomes effective, all other powers of attorney and
proxies that you have given will be revoked, and you may not give any subsequent
powers of attorney or proxies or execute any subsequent written consents and, if
given or executed, we will treat them as ineffective.
Upon our deposit of shares of our common stock as the exchange
consideration with the depositary, our designees will, with respect to your
shares of Thermo Instrument common stock and other securities for which the
appointment is effective, be empowered to exercise all of your voting and other
rights as they in their sole discretion consider proper. We may exercise these
rights at any time Thermo Instrument stockholders vote. We reserve the right to
require that, for us to treat your shares of Thermo Instrument common stock as
validly tendered, we be able to exercise full voting and other rights of a
record and beneficial holder immediately upon our acceptance for exchange of
your shares of Thermo Instrument common stock.
Determination of Validity. We will determine all questions as to the
validity, form, eligibility, including the time of receipt, and acceptance for
exchange of any tendered shares of Thermo Instrument common stock pursuant to
any of the procedures described above. We will make these determinations in our
sole discretion, and our determinations will be final and binding. We reserve
the absolute right to reject any and all tenders of shares of Thermo Instrument
common stock that we determine are not in proper form or for which the
acceptance of, or exchange for, may, in the opinion of our counsel, be unlawful.
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<PAGE> 38
We also reserve the absolute right to waive any of the conditions of the
exchange offer or any defect or irregularities in the tender of any shares of
Thermo Instrument common stock, whether or not similar defects or irregularities
are waived in the case of any other shares of Thermo Instrument common stock. We
will not treat your tender of shares of Thermo Instrument common stock as
validly made until all defects and irregularities have been cured or waived.
Neither we nor any of our affiliates or assigns, the information agent, the
depositary or any other person will be under any duty to give notification of
any defects or irregularities in tenders or incur any liability for failure to
give any such notification. Our interpretations of the terms and conditions of
the exchange offer, including the letter of transmittal and the instructions to
the letter of transmittal, will be final and binding.
OUR ACCEPTANCE FOR EXCHANGE OF YOUR SHARES OF THERMO INSTRUMENT COMMON
STOCK TENDERED PURSUANT TO THE PROCEDURES DESCRIBED ABOVE WILL BE A BINDING
AGREEMENT BETWEEN US AND YOU UPON THE TERMS AND CONDITIONS OF THIS EXCHANGE
OFFER.
WITHDRAWAL RIGHTS
General. Your tender of shares of Thermo Instrument common stock pursuant
to the exchange offer is irrevocable except as otherwise provided in this
section. You may withdraw shares of Thermo Instrument common stock that you
tender in the exchange offer at any time before the exchange offer expires and,
unless we have previously accepted these shares for exchange as provided in this
prospectus, at any time after June 22, 2000. If we elect to provide a subsequent
offering period under Exchange Act Rule 14d-11, you will not have the right to
withdraw shares of Thermo Instrument common stock that you tender in the
subsequent offering period.
Extensions. If we:
- extend the exchange offer,
- are delayed in, or delay, our acceptance for exchange or the actual
exchange of shares of Thermo Instrument common stock, or
- are unable for any reason to accept for exchange or exchange shares of
Thermo Instrument common stock,
then, without prejudice to our other rights under the exchange offer, the
depositary, on our behalf, may nevertheless return your tendered shares of
Thermo Instrument common stock and you may not exercise withdrawal rights except
to the extent described in this section. We will extend the exchange offer to
the extent required by law in the event of any extension or delay.
Effectiveness of Withdrawal. For your withdrawal to be effective, the
depositary must receive from you a written, telegraphic or facsimile
transmission notice of withdrawal at one of its addresses set forth on the back
cover of this prospectus. Your notice of withdrawal must include:
- your name;
- the number of shares of Thermo Instrument common stock that you wish to
withdraw; and
- the name of the registered holder of the shares of Thermo Instrument
common stock that you wish to withdraw, if different from that of the
person who tendered the shares of Thermo Instrument common stock.
If you have delivered or otherwise identified your share certificates to the
depositary, then, before the physical release of the share certificates, you
must also submit the serial numbers shown on the share certificates to the
depositary and you must have the signatures on the notice of withdrawal
guaranteed by an eligible institution, unless the shares of Thermo Instrument
common stock have been tendered for the account of an eligible institution. If
you tendered shares of Thermo Instrument common stock pursuant to the procedures
for book-entry transfer, as set forth above under "-- Procedures For Accepting
The Offer And Tendering Shares," any notice of withdrawal must specify the name
and number of the account at
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<PAGE> 39
The Depository Trust Company to be credited with the withdrawn shares of Thermo
Instrument common stock and must otherwise comply with the procedures of The
Depository Trust Company.
Revocation of Withdrawal. You may not revoke a withdrawal. We will treat
any shares of Thermo Instrument common stock properly withdrawn as not validly
tendered for purposes of the exchange offer. However, you may re-tender
withdrawn shares of Thermo Instrument common stock at any time before the
exchange offer expires by again following one of the procedures described above
under "-- Procedures For Accepting The Offer And Tendering Shares."
Validity of Withdrawals. We will determine all questions as to the form
and validity, including the time of receipt, of any notice of withdrawal in our
sole discretion, and our determination will be final and binding. Neither we nor
any of our affiliates or assigns, the information agent, the depositary or any
other person will be under any duty to notify you of any defects or
irregularities in any notice of withdrawal or incur any liability for failure to
give any such notification.
CONDITIONS OF THE OFFER
We have the right to extend or amend the exchange offer in our sole
discretion at any time before the exchange offer expires. In addition, we:
- are not required to accept for exchange or, subject to any applicable
rules and regulations of the SEC, including Rule 14e-1(c) under the
Exchange Act, relating to our obligation to return tendered shares of
Thermo Instrument common stock promptly after termination or withdrawal
of the exchange offer, exchange shares of our common stock for any
tendered shares of Thermo Instrument common stock, and
- may delay the acceptance for exchange of or, subject to the restriction
referred to above, the exchange of, any tendered shares of Thermo
Instrument common stock.
Minimum Number of Shares. We may amend or terminate the exchange offer if
we would not own at least 90% of the outstanding shares of Thermo Instrument
immediately following the closing of the exchange offer. As of May 31, 2000, we
owned approximately 88.5% of the outstanding shares of Thermo Instrument common
stock. Assuming that optionholders exercised all outstanding Thermo Instrument
stock options and debenture holders did not convert any of Thermo Instrument's
4% convertible subordinated debentures or 4.5% senior convertible debentures
into Thermo Instrument common stock, we would have owned approximately 85.0% of
the outstanding shares of Thermo Instrument common stock at that date. As of
June 26, 2000, Thermo Instrument stockholders had tendered and not withdrawn
11,866,494 shares, or 9.2% of the outstanding shares, of Thermo Instrument
common stock pursuant to this exchange offer. These shares may be withdrawn at
any time before the exchange offer expires.
Other Conditions. In addition, we may amend or terminate the exchange
offer at any time on or after April 24, 2000 and before the time of acceptance
of the shares of Thermo Instrument common stock for exchange in the exchange
offer if any of the following events shall occur:
- any change occurs in the business, properties, assets, liabilities,
capitalization, stockholders' equity, financial condition, cash flows,
operations, licenses, franchises or results of operations of Thermo
Instrument or its subsidiaries which has a material adverse effect on
Thermo Instrument and its subsidiaries taken as a whole;
- any "governmental entity," including a government or governmental
authority or agency, whether domestic, foreign or supranational,
institutes or threatens any action, proceeding, application, claim or
counterclaim, seeks or obtains any judgment, order or injunction, or
takes any other action, which:
-- challenges the acquisition by us or any of our affiliates of any
shares of Thermo Instrument common stock pursuant to the exchange
offer or the merger, restrains, prohibits or materially delays the
making or consummation of the exchange offer or the merger, prohibits
the performance of any of the contracts or other arrangements entered
into by us or any of our
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<PAGE> 40
affiliates in connection with the acquisition of the shares of Thermo
Instrument common stock or Thermo Instrument, seeks to obtain any
material amount of damages, or otherwise directly or indirectly
adversely affects the exchange offer or the merger;
-- seeks to prohibit or limit materially the ownership or operation by
us, any of our affiliates or Thermo Instrument of all or any material
portion of our business or assets or the businesses or assets of our
affiliates or of Thermo Instrument and its subsidiaries, or to compel
us, any of our affiliates or Thermo Instrument to dispose of or to
hold separate all or any material portion of our, any of our
affiliate's or Thermo Instrument's or its subsidiaries' businesses or
assets as a result of the transactions contemplated by the exchange
offer or the merger;
-- seeks to impose any material limitation on the ability of us, any of
our affiliates or Thermo Instrument to conduct Thermo Instrument's or
its subsidiaries' businesses or to own Thermo Instrument's or its
subsidiaries' assets;
-- seeks to impose or confirm any material limitation on the ability of
us or any of our affiliates to acquire or hold, or to exercise full
rights of ownership of, any shares of Thermo Instrument common stock,
including the right to vote such shares of Thermo Instrument common
stock on all matters properly presented to the stockholders of Thermo
Instrument;
-- seeks to require us or any of our affiliates to divest all or any of
our shares of Thermo Instrument common stock; or
-- otherwise has resulted in or has a reasonable likelihood of resulting
in a material adverse effect on our, any of our affiliate's or Thermo
Instrument's business, financial condition, results of operation or
prospects;
- any statute, rule or regulation is enacted, promulgated, entered,
enforced or treated as applicable to the exchange offer or the merger, or
any other action is taken by any governmental entity or court, that
results in, directly or indirectly, any of the consequences referred to
in first four sub-bullets of the preceding bullet;
- any preliminary or permanent judgment, order, decree, ruling or
injunction is entered or issued, or any other action is taken by any
governmental entity or court, whether on its own initiative or the
initiative of any other person, which:
-- restrains, prohibits or materially delays the making or completing of
the exchange offer or the merger, prohibits the performance of any of
the contracts or other arrangements entered into by us or any of our
affiliates in connection with the acquisition of the shares of Thermo
Instrument common stock or Thermo Instrument or otherwise directly or
indirectly materially adversely affects the exchange offer or the
merger;
-- prohibits or limits materially the ownership or operation by us, any
of our affiliates or Thermo Instrument of all or any material portion
of our business or assets or the businesses or assets of our
affiliates or of Thermo Instrument and its subsidiaries, or compels
us, any of our affiliates or Thermo Instrument to dispose of or to
hold separate all or any material portion of our, any of our
affiliate's or Thermo Instrument's or its subsidiaries' businesses or
assets as a result of the transactions contemplated by the exchange
offer or the merger;
-- imposes any material limitation on the ability of us or any of our
affiliates to conduct Thermo Instrument's or its subsidiaries'
businesses or to own Thermo Instrument's or its subsidiaries' assets;
-- imposes or confirms any material limitation on the ability of us or
any of our affiliates to acquire or hold, or to exercise full rights
of ownership of, any shares of Thermo Instrument common stock,
including the right to vote such shares of Thermo Instrument common
stock on all matters properly presented to the stockholders of Thermo
Instrument;
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<PAGE> 41
-- requires us or any of our affiliates to divest of all or any of our
shares of Thermo Instrument common stock; or
-- otherwise has resulted in or has a reasonable likelihood of resulting
in a material adverse effect on our, any of our affiliate's or Thermo
Instrument's business, financial condition, results of operation or
prospects;
- any action, proceeding, application, claim or counterclaim is instituted
or pending before any governmental entity or court, or any judgment,
order or injunction is sought or any other action is taken by any person
or entity, other than a governmental entity, which:
-- challenges the acquisition by us or any of our affiliates of any
shares of Thermo Instrument common stock pursuant to the exchange
offer or the merger, restrains, prohibits or materially delays the
making or consummation of the exchange offer or the merger, prohibits
the performance of any of the contracts or other arrangements entered
into by us or any of our affiliates in connection with the acquisition
of the shares of Thermo Instrument common stock, seeks to obtain any
material amount of damages, or otherwise directly or indirectly
adversely affects the exchange offer or the merger;
-- seeks to prohibit or limit materially the ownership or operation by
us, any of our affiliates or Thermo Instrument of all or any material
portion of our business or assets or the businesses or assets of our
affiliates or of Thermo Instrument and its subsidiaries, or to compel
us, any of our affiliates or Thermo Instrument to dispose of or to
hold separate all or any material portion of our, any of our
affiliate's or Thermo Instrument's or its subsidiaries' businesses or
assets as a result of the transactions contemplated by the exchange
offer or the merger;
-- seeks to impose any material limitation on the ability of us, any of
our affiliates or Thermo Instrument to conduct Thermo Instrument's or
its subsidiaries' businesses or to own Thermo Instrument's and its
subsidiaries' assets;
-- seeks to impose or confirm any material limitation on the ability of
us or any of our affiliates to acquire or hold, or to exercise full
rights of ownership of, any shares of Thermo Instrument common stock,
including the right to vote such shares of Thermo Instrument common
stock on all matters properly presented to the stockholders of Thermo
Instrument;
-- seeks to require us or any of our affiliates to divest of all or any
of our shares of Thermo Instrument common stock; or
-- otherwise has resulted in or, in our reasonable discretion, has a
reasonable likelihood of resulting in a material adverse effect on
our, any of our affiliates' or Thermo Instrument's business, financial
condition, results of operation or prospects;
and which in the case of the first five sub-bullets of this bullet is
successful or we determine, in our reasonable discretion, has a reasonable
likelihood of being successful;
- the registration statement of which this prospectus is a part does not
become effective under the Securities Act of 1933 or is the subject of
any stop order or proceedings seeking a stop order;
- the shares of our common stock issuable to Thermo Instrument stockholders
in the exchange offer and the merger and the shares issuable upon the
exercise of options to purchase shares of our common stock or the
conversion of debentures convertible into our common stock are not
approved for listing on the New York Stock Exchange, subject to official
notice of issuance;
- any general suspension of trading in, or limitation on prices for,
securities occurs on the New York Stock Exchange or the American Stock
Exchange or in the over-the-counter market, other than any temporary
suspension pursuant to a circuit breaker procedure then in effect and
lasting for not more than three trading hours;
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<PAGE> 42
- any declaration of a banking moratorium by federal or New York
authorities or general suspension of payments in respect of lenders that
regularly participate in the U.S. market in loans occurs;
- any material limitation by any federal, state or local government or any
court, administrative or regulatory agency or commission or other
governmental authority or agency in the United States occurs that
materially affects the extension of credit generally by lenders that
regularly participate in the U.S. market in loans;
- any commencement of a war involving the United States or any commencement
of armed hostilities or other national or international circumstance
involving the United States occurs that has a material adverse effect on
bank syndication or financial markets in the United States; or
- in the case of any occurrence described in the previous four bullets that
existed on or at the time of the commencement of the exchange offer, a
material acceleration or worsening of that occurrence; which in our
reasonable judgment, in any case and regardless of the circumstances
giving rise to the condition, makes it inadvisable to proceed with the
exchange offer or with acceptance of shares of Thermo Instrument common
stock for exchange or exchanges of shares of our common stock for shares
of Thermo Instrument common stock.
Conditions Solely for Our Benefit. The foregoing conditions are for our
sole benefit and we may assert them regardless of any circumstances giving rise
to any condition. We may waive these conditions in whole or in part, at any time
and from time to time before the exchange offer expires, in our reasonable
discretion. Our failure, or the failure of any of our affiliates, at any time to
exercise any of the foregoing rights will not constitute a waiver of any right.
We will treat each right as an ongoing right which may be asserted at any time
and from time to time before the exchange offer expires.
LEGAL MATTERS; REGULATORY APPROVALS
General. Except as described below, we are not aware of any license or
regulatory permit that appears to be material to the business of Thermo
Instrument and its subsidiaries and may be adversely affected by our acquisition
of shares of Thermo Instrument common stock in the exchange offer or the merger.
Except as described in this section, we are not aware of any other material
filing, approval or other action by any federal or state governmental or
administrative authority that we must obtain in connection with our acquisition
of shares of Thermo Instrument common stock as contemplated in this prospectus.
Should any other similar approval or action be required, we currently
contemplate seeking that approval or action. We cannot assure you that we could
obtain any other approval or action, if needed, without substantial conditions
or costs or that adverse consequences would not result to our or Thermo
Instrument's business if we do not obtain any other required approvals or
actions. Our obligation under the exchange offer to accept for exchange and
exchange shares of Thermo Instrument common stock is subject to a number of
conditions, including conditions relating to the legal matters discussed in this
section. See "-- Conditions Of The Offer."
Antitrust. We believe that the exchange offer and the merger are exempt
from the reporting requirements contained in the Hart-Scott-Rodino Antitrust
Improvements Act of 1976. Nevertheless, we cannot assure that a challenge to the
exchange offer and the merger on antitrust grounds will not be made or, if such
challenge is made, what the result will be.
Foreign Approvals. Thermo Instrument conducts business in a number of
foreign countries and jurisdictions. In connection with our acquisition of
shares of Thermo Instrument common stock pursuant to the exchange offer or the
merger, we and/or Thermo Instrument may be required to file information with, or
obtain the approval or consent of, governmental authorities in those foreign
countries and jurisdictions. The governments in those countries and
jurisdictions might attempt to impose additional conditions on Thermo
Instrument's operations conducted in such countries and jurisdictions as a
result of our acquisition of the shares of Thermo Instrument common stock
pursuant to the exchange offer or the merger of Thermo Instrument into Thermo
Electron.
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<PAGE> 43
If foreign approvals or consents are required, we intend to make the
appropriate filings and applications. We do not know if or when we will obtain
any required foreign approvals or consents for which we file or apply. In
addition, we may be unable to cause Thermo Instrument or its subsidiaries to
satisfy or comply with foreign laws. Noncompliance may have adverse consequences
for Thermo Instrument or its subsidiaries after the exchange of shares of our
common stock for shares of Thermo Instrument common stock pursuant to the
exchange offer or the merger.
State Anti-Takeover Statutes. Section 203 of the Delaware General
Corporation Law prohibits business combination transactions involving a Delaware
corporation, such as Thermo Instrument, and an "interested stockholder" for
three years following the time the person became an interested stockholder.
Section 203 defines an interested stockholder in general as any person that
directly or indirectly beneficially owns 15% or more of the outstanding voting
stock of the subject corporation. The prohibitions in Section 203 do not apply
if special requirements are met or exceptions apply, including that prior to the
time a person became an interested stockholder the board of directors of the
subject corporation approved either the business combination or the transaction
which resulted in such person being an interested stockholder. We believe that
neither the exchange offer nor the merger is prohibited by Section 203 of the
Delaware General Corporation Law.
A number of other states have adopted laws and regulations applicable to
attempts to acquire securities of corporations which are incorporated, or have
substantial assets, stockholders, principal executive offices or principal
places of business, or whose business operations otherwise have substantial
economic effects, in such states. In 1982, in Edgar v. MITE Corp., the Supreme
Court of the United States invalidated on constitutional grounds the Illinois
Business Takeover Statute, which, as a matter of state securities law, made
takeovers of corporations meeting the statute's requirements more difficult.
However, in 1987 in CTS Corp. v. Dynamics Corp. of America, the Supreme Court
held that the State of Indiana may, as a matter of corporate law, and, in
particular, with respect to those aspects of corporate law concerning corporate
governance, constitutionally disqualify a potential acquiror from voting on the
affairs of a target corporation without the prior approval of the remaining
stockholders. The state law before the Supreme Court was by its terms applicable
only to corporations that had a substantial number of stockholders in that state
and were incorporated there.
Thermo Instrument, directly or through its subsidiaries, conducts business
in a number of states throughout the United States, some of which have enacted
anti-takeover laws. We do not know whether any of these laws will, by their
terms, apply to the exchange offer or the merger, and we have not necessarily
complied with any such laws. Should any person seek to apply any state
anti-takeover law to the exchange offer or the merger, we will take such action
as then appears desirable, which may include challenging the validity or
applicability of any such statute in appropriate court proceedings. In the event
it is asserted that one or more state anti-takeover laws is applicable to the
exchange offer or the merger, and an appropriate court does not determine that
it is inapplicable or invalid as applied to the exchange offer or the merger, we
may be required to file information with, or receive approvals from, the
relevant state authorities. In addition, if enjoined, we may be unable to accept
for exchange any shares of Thermo Instrument common stock tendered pursuant to
the exchange offer, or be delayed in continuing or consummating the exchange
offer. In any such case, we may not be obligated to accept for exchange any
shares of Thermo Instrument common stock tendered. See "-- Conditions Of The
Offer."
DIVIDENDS AND DISTRIBUTIONS
If, on or after April 24, 2000, Thermo Instrument should declare or pay any
dividend or other distribution, including without limitation the issuance of
additional shares of Thermo Instrument common stock pursuant to any stock
dividend or stock split or the issuance of rights for the purchase of any
securities, with respect to the shares of Thermo Instrument common stock, and
the dividend or distribution is payable or distributable to stockholders of
record on a date occurring before the transfer to our name or the name of our
nominees or transferees on Thermo Instrument's stock transfer records of the
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shares of Thermo Instrument common stock acquired pursuant to the exchange
offer, then, without prejudice to our rights described in "-- Conditions Of The
Offer":
- in the event of a cash dividend or distribution, the exchange ratio per
share will be reduced by multiplying the exchange ratio by a fraction the
numerator of which is $19.375, the closing market price of the Thermo
Instrument common stock on March 7, 2000, minus the amount of the cash
dividend or distribution and the denominator is $19.375; and
- in the event of a non-cash dividend or distribution, you will be required
to deliver promptly and transfer to the depositary for our account any
non-cash dividend or distribution, including additional shares of Thermo
Instrument common stock, together with appropriate documentation of
transfer. Pending your remittance or appropriate assurance of your
remittance, we will be entitled to all rights and privileges as owner of
any such non-cash dividend, distribution or right, and may withhold all
of the shares of our common stock issuable to you in the exchange offer
or reduce the exchange ratio by multiplying the exchange ratio by a
fraction, the numerator of which is $19.375, the closing price of the
Thermo Instrument common stock on March 7, 2000 minus the value of such
non-cash dividend, distribution or right, as determined by us in our sole
discretion, and the denominator of which is $19.375.
If, on or after April 24, 2000, Thermo Instrument should split the shares
of its common stock or combine or otherwise change the shares of its common
stock or its capitalization, then, without prejudice to our rights described in
"-- Conditions Of The Offer," we may make appropriate adjustments to reflect
such split, combination or change in the exchange ratio and other terms of the
exchange offer, including without limitation the number or type of securities we
are offering in exchange for Thermo Instrument common stock.
FEES AND EXPENSES
J.P. Morgan and The Beacon Group are acting as our financial advisors in
connection with the exchange offer and the merger involving Thermo Instrument
described in this prospectus.
In October 1999, we engaged The Beacon Group as our financial advisor in
connection with our proposed acquisition of the outstanding shares held by
public stockholders in our subsidiaries that had public stockholders. We paid
The Beacon Group $500,000 in fees for services that The Beacon Group rendered
pursuant to that engagement in connection with our acquisition of the
outstanding publicly-held shares of common stock of ThermoTrex Corporation and
ThermoLase Corporation.
Pursuant to our letter agreement with J.P. Morgan and The Beacon Group,
dated January 17, 2000, we agreed to pay each of J.P. Morgan and The Beacon
Group a fee of $500,000 for its services in connection with the exchange offer
and the merger involving Thermo Instrument described in this prospectus. In
addition, we will reimburse J.P. Morgan and The Beacon Group for expenses
incurred in connection with these transactions. The letter agreement also
relates to our overall reorganization and provides for separate fees for
services with respect to other elements of our reorganization. These other fees
include a minimum retainer for each of J.P. Morgan and The Beacon Group of $1.25
million. The engagement letter provides for substantial additional compensation
if we complete some or all of the other elements of our reorganization. We have
agreed to indemnify J.P. Morgan and The Beacon Group and their affiliates
against liabilities relating to their engagement by us, including liabilities
under the federal securities laws.
We have retained D.F. King & Co., Inc. to act as the information agent and
American Stock Transfer & Trust Company to act as the depositary in connection
with the exchange offer. The information agent may contact holders of shares of
Thermo Instrument common stock by mail, telephone, telex, telecopy, telegraph
and personal interview and may request brokers, dealers, commercial banks, trust
companies and other nominees to forward the exchange offer material to
beneficial owners. Each of the information agent and the depositary will receive
reasonable and customary compensation for its services,
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will be reimbursed for reasonable out-of-pocket expenses and will be indemnified
against liabilities and expenses in connection with the exchange offer,
including liabilities under U.S. federal securities laws.
We will not pay any fees or commissions to any broker or dealer or any
other person for soliciting tenders of shares of Thermo Instrument common stock
in the exchange offer, other than to the information agent. We will, upon
request, reimburse brokers, dealers, commercial banks and trust companies for
customary mailing and handling expenses incurred by them in forwarding materials
to their customers.
The following is an estimate of the fees and expenses that we expect to
incur in connection with the exchange offer and the merger:
<TABLE>
<CAPTION>
<S> <C>
Financial Advisors.......................................... $1,000,000
Legal....................................................... 250,000
Printing.................................................... 100,000
Listing Fee................................................. 25,650
SEC Filing Fee.............................................. 100,789
Depositary.................................................. 7,500
Information Agent, including mailing........................ 15,000
Miscellaneous............................................... 26,061
----------
$1,525,000
==========
</TABLE>
We will pay these fees and expenses, including any cash paid for fractional
shares, out of cash that we currently hold. Thermo Instrument will not pay any
of the fees and expenses to be incurred by us in connection with the exchange
offer.
STOCK EXCHANGE LISTING
Our common stock is listed on the New York Stock Exchange. We will make an
application as necessary to list on the New York Stock Exchange the common stock
that we will issue pursuant to the exchange offer and the merger. We will not
accept for exchange, or exchange for shares of our common stock, any shares of
common stock of Thermo Instrument or complete the merger unless the following
shares of our common stock are approved for listing on the New York Stock
Exchange, subject to official notice of issuance:
- the shares issuable to Thermo Instrument stockholders in the exchange
offer and the merger;
- the shares issuable upon the exercise of options to purchase shares of
Thermo Instrument common stock that we assume in connection with the
exchange offer and the merger; and
- shares issuable upon the conversion of the Thermo Instrument convertible
debentures that we assume in connection with the exchange offer and the
merger.
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MARKET PRICES AND DIVIDENDS
PRICE RANGE OF SHARES OF OUR COMMON STOCK AND OF THERMO INSTRUMENT COMMON STOCK
Our common stock is listed on the New York Stock Exchange under the symbol
"TMO." Thermo Instrument common stock is listed on the American Stock Exchange
under the symbol "THI." The following table sets forth the high and low sales
prices per share of our common stock and of Thermo Instrument common stock, as
reported in publicly available sources for each of the periods indicated.
<TABLE>
<CAPTION>
THERMO
THERMO ELECTRON INSTRUMENT
---------------- --------------
HIGH LOW HIGH LOW
----- ----- ---- ----
<S> <C> <C> <C> <C>
Fiscal Year Ended January 2, 1999:
First Quarter......................................... 43 5/16 36 5/8 35 7/16 27 13/16
Second Quarter...................................... 41 15/16 30 3/4 34 1/2 25 7/8
Third Quarter....................................... 35 3/16 14 3/16 26 1/2 10
Fourth Quarter...................................... 20 1/16 13 9/16 15 1/8 7 7/8
Fiscal Year Ended January 1, 2000:
First Quarter....................................... 18 3/16 13 3/8 17 7/16 13 1/2
Second Quarter...................................... 20 1/4 12 1/2 16 7/8 12 3/16
Third Quarter....................................... 19 11/16 13 1/8 17 10 3/8
Fourth Quarter...................................... 16 1/8 12 3/4 12 3/4 8 1/8
Fiscal Year Ending December 30, 2000:
First Quarter....................................... 26 7/8 14 23 10 1/4
Second Quarter, through June 26, 2000............... 21 7/16 17 3/4 21 1/8 15 1/4
</TABLE>
As of June 26, 2000, there were 8,011 holders of record and in excess of
36,400 beneficial owners of the shares of our common stock. As of June 26, 2000,
there were 2,276 holders of record and in excess of 6,100 beneficial owners of
shares of Thermo Instrument common stock.
On January 28, 2000, the last full trading day prior to the public
announcement of our intention to commence the exchange offer, the closing sale
price per share of Thermo Instrument common stock, as reported on the American
Stock Exchange, was $15.6875. On March 7, 2000, the day prior to our
announcement of the exchange ratio, the closing sale price per share of Thermo
Instrument common stock, as reported on the American Stock Exchange, was
$19.9375.
YOU SHOULD OBTAIN CURRENT MARKET QUOTATIONS FOR THE SHARES OF OUR COMMON
STOCK AND THERMO INSTRUMENT COMMON STOCK.
DIVIDENDS
Neither we nor Thermo Instrument has ever declared or paid any cash
dividends in respect of our or their common stock.
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THE MERGER; APPRAISAL RIGHTS
THE MERGER
If we complete the exchange offer, we will cause Thermo Instrument to merge
with and into Thermo Electron in accordance with the Delaware General
Corporation Law. Upon the effective date of this merger, each share of Thermo
Instrument common stock issued and outstanding immediately prior to the
effective date of the merger, other than shares owned by us and shares held by
Thermo Instrument's public stockholders, if any, who are entitled to and who
properly exercise their dissenters' rights under the Delaware General
Corporation Law, as described below under "-- Appraisal Rights," will be
cancelled and converted into a right to receive 0.85 shares of our common stock
for each share of Thermo Instrument common stock. Thermo Instrument stockholders
will also be entitled to receive cash in lieu of the issuance of fractional
shares of our common stock in an amount equal to $19.1875 for each whole share
of our common stock. As a result of the merger, Thermo Instrument will cease to
exist as a separate legal entity, and we will own all of Thermo Instrument's
assets.
Under the Delaware General Corporation Law, if we hold at least 90% of the
outstanding shares of Thermo Instrument common stock, we may effect the merger
without a vote of Thermo Instrument's board of directors or Thermo Instrument's
other stockholders. We intend to take all necessary and appropriate action to
cause the merger to become effective as promptly as practicable after we
complete the exchange offer, and without a meeting of the Thermo Instrument's
stockholders.
APPRAISAL RIGHTS
The Delaware General Corporation Law does not entitle stockholders of
Thermo Instrument who tender their shares of Thermo Instrument common stock in
the exchange offer to appraisal rights. If we complete the merger, then
stockholders of Thermo Instrument who do not tender their shares of Thermo
Instrument common stock to us pursuant to the exchange offer would have the
right to demand an appraisal of the fair value of their shares of Thermo
Instrument common stock in accordance with the provisions of Section 262 of the
Delaware General Corporation Law, which sets forth the rights and obligations of
stockholders of Thermo Instrument demanding an appraisal and the procedures to
be followed.
The Appraisal Statute. Under Delaware law, record holders of shares of
Thermo Instrument common stock who follow the procedures set forth in Section
262 will be entitled to have their shares appraised by the Court of Chancery of
the State of Delaware and to receive payment of the fair value of their shares
together with a fair rate of interest, if any, as determined by such court. The
Delaware court does not consider benefits arising from the merger in determining
the value of the Thermo Instrument common stock. The following is a summary of
the provisions of Section 262 of the Delaware General Corporation Law and is
qualified in its entirety by reference to the full text of Section 262, a copy
of which is included with this prospectus as Annex C.
Required Notice and Demand. Within ten days following the consummation of
the merger, we would notify the Thermo Instrument stockholders of record of:
- the effective date of the merger;
- the approval and consummation of the merger; and
- the availability of appraisal rights under Section 262.
Any Thermo Instrument stockholder entitled to appraisal rights would have the
right, within 20 days after the date of mailing of the required notice, to
demand in writing from us an appraisal of the stockholder's shares. Such demand
would be sufficient if it reasonably informs us of the identity of the
stockholder and that the stockholder intends to demand an appraisal of the fair
value of the stockholder's shares. Failure to make such a timely demand would
foreclose a Thermo Instrument stockholder's right to appraisal.
Only a record holder of shares of Thermo Instrument common stock at the
time of the merger would be entitled to assert appraisal rights for the shares
registered in that holder's name. You should execute any demand for appraisal in
your name, as it appears on your stock certificates, if you are the holder of
record. If you are not the holder of record, you should have the holder of
record execute any demand for
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<PAGE> 48
appraisal. Holders of shares of Thermo Instrument common stock who hold their
shares in brokerage accounts or other nominee forms and wish to exercise
appraisal rights should consult with their brokers to determine the appropriate
procedures for the making of a demand for appraisal by such nominee. You should
send or deliver all written demands for appraisal to Sandra L. Lambert,
Secretary, Thermo Instrument Systems Inc., c/o Thermo Electron Corporation, 81
Wyman Street, P.O. Box 9046, Waltham, Massachusetts 02454-9046, so that we
receive the request within 20 days after our mailing of the notice of the merger
described above.
If you own shares of Thermo Instrument common stock in a fiduciary
capacity, such as in a capacity as a trustee, guardian or custodian, you should
execute the demand in that capacity. If more than one person owns the shares, as
in a joint tenancy or tenancy in common, all of the joint owners should execute
the demand or you should execute the demand on behalf of all of the joint
owners.
An authorized agent, including one or more joint owners, may execute a demand
for appraisal on behalf of a holder of record; however, the agent must identify
the record owner or owners and expressly disclose the fact that, in executing
the demand, the agent is agent for such owner or owners.
A record holder, such as a broker holding shares of Thermo Instrument
common stock as nominee for several beneficial owners, may exercise appraisal
rights with respect to the shares held for one or more beneficial owners while
not exercising such rights with respect to the shares held for other beneficial
owners. In such case, the written demand should set forth the number of shares
as to which appraisal is sought. Where no number of shares is expressly
mentioned, the demand will be presumed to cover all shares held in the name of
the record owner.
Filing a Petition for Appraisal. Within 120 calendar days after the
effective date of the merger, we or any stockholder entitled to appraisal rights
under Section 262 and who has complied with the foregoing procedures may file a
petition in the Delaware Court of Chancery demanding a determination of the fair
value of the shares of Thermo Instrument common stock of all such stockholders.
We are not under any obligation, and have no present intention, to file a
petition with respect to the appraisal of the fair value of the shares of Thermo
Instrument common stock. Accordingly, it is the obligation of the stockholders
to initiate all necessary action to perfect their appraisal rights within the
time prescribed in Section 262.
Information We Will Provide. Within 120 calendar days after the effective
date of the merger, any stockholder of record who has complied with the
requirements for exercise of appraisal rights will be entitled, upon written
request, to receive from us a statement setting forth the aggregate number of
shares of Thermo Instrument common stock with respect to which demands for
appraisal have been received and the aggregate number of holders of such shares.
We must mail this statement within 10 calendar days after we receive a written
request or within 10 calendar days after the expiration of the period for the
delivery of demands for appraisals, whichever is later.
The Court's Determination. If you file a petition for an appraisal on a
timely basis, then, after a hearing on the petition, the Delaware Court of
Chancery will determine the stockholders entitled to appraisal rights and will
appraise the fair value of the shares of Thermo Instrument common stock,
together with a fair rate of interest, if any, to be paid upon the amount
determined to be the fair value. If you are considering seeking appraisal, you
should be aware that the fair value of your shares as determined under Section
262 could be more than, the same as or less than the amount per share that you
would otherwise receive if you did not seek appraisal of your shares. The
Delaware Supreme Court has stated that "proof of value by any techniques or
methods that are generally considered acceptable in the financial community and
otherwise admissible in court" should be considered in appraisal proceedings. In
addition, Delaware courts have decided that the statutory appraisal remedy,
depending on factual circumstances, may or may not be a dissenter's exclusive
remedy.
The Court will determine the amount of interest, if any, to be paid upon
the amounts to be received by persons whose shares have been appraised. The
Court may also determine the costs of the action and tax the parties as the
Court deems equitable. The Court may also order that all or a portion of the
expenses incurred by any holder of shares in connection with an appraisal,
including, without limitation, reasonable attorneys' fees and the fees and
expenses of experts used in the appraisal proceeding, be charged pro rata
against the value of all the shares entitled to appraisal.
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The Court may require stockholders who have demanded an appraisal and who
hold shares of Thermo Instrument common stock represented by certificates to
submit their certificates for shares to the Court for notation thereon of the
pendency of the appraisal proceedings. If any stockholder fails to comply with
such direction, the Court may dismiss the proceedings as to such stockholder.
Consequences of a Demand for Appraisal. Any stockholder who has duly
demanded an appraisal in compliance with Section 262 will not, after the
effective date of the merger, be entitled to vote the shares of Thermo
Instrument common stock subject to such demand for any purpose or to be entitled
to the payment of dividends or other distributions on those shares, except
dividends or other distributions payable to holders of record of shares as of a
date prior to the effective date of the merger.
If any stockholder who demands appraisal of shares under Section 262 fails
to perfect, or effectively withdraws or loses, the right to appraisal, as
provided in the Delaware General Corporation Law, the shares of Thermo
Instrument common stock of such holder will be converted into the right to
receive 0.85 shares of our common stock for each share of Thermo Instrument
common stock plus cash in lieu of the issuance of fractional shares of our
common stock in an amount equal to $19.1875 per whole share, without interest. A
stockholder will fail to perfect, or effectively lose, the right to appraisal if
no petition is filed within 120 calendar days after the effective date of the
merger. A stockholder may withdraw a demand for appraisal by delivering to us a
written withdrawal of the demand for appraisal and acceptance of the merger,
except that any such attempt to withdraw made more than 60 calendar days after
the effective date of the merger will require our written approval. Once you
have filed a petition for appraisal, the appraisal proceeding may not be
dismissed as to any stockholder without the approval of the Court.
For federal income tax purposes, stockholders who receive cash for their
shares of Thermo Instrument common stock upon exercise of dissenters' rights
will realize taxable gain or loss. See "Federal Income Tax Consequences."
THE FOREGOING SUMMARY IS NOT A COMPLETE STATEMENT OF THE PROCEDURES THAT
YOU MUST FOLLOW TO EXERCISE YOUR DISSENTING APPRAISAL RIGHTS. THE FULL TEXT OF
THE DELAWARE APPRAISAL STATUTE IS ATTACHED TO THIS PROSPECTUS AS ANNEX C. YOU
SHOULD READ ANNEX C IN ITS ENTIRETY BECAUSE FAILING TO COMPLY WITH THE
PROCEDURES SET FORTH IN THE DELAWARE APPRAISAL STATUTE WILL RESULT IN THE LOSS
OF YOUR APPRAISAL RIGHTS.
FEDERAL INCOME TAX CONSEQUENCES
This section summarizes the important federal income tax consequences of
the exchange offer and the merger to you. This summary is based on the current
Internal Revenue Code, Treasury regulations and administrative rulings and court
decisions, all of which can change. If there are any changes to the Internal
Revenue Code, those regulations or those rulings and decisions, the tax
consequences to you might change. Any changes could be retroactive.
You should know that this summary does not deal with all federal income tax
considerations that may be relevant to you because of your particular
circumstances. Some examples of circumstances that would involve different
federal income tax consequences are if you:
- were a dealer in securities;
- were an insurance company or financial institution;
- were a foreign person or entity;
- do not hold your Thermo Instrument common stock as a capital asset; or
- acquired your shares in connection with stock option or stock purchase
plans or in other compensatory transactions.
In addition, the following discussion does not address the tax consequences
of the exchange offer and the merger under foreign, state or local tax laws. WE
RECOMMEND THAT YOU CONSULT YOUR OWN TAX ADVISOR AS TO THE SPECIFIC TAX
CONSEQUENCES TO YOU OF THE EXCHANGE OFFER AND THE MERGER, INCLUDING THE
APPLICATION OF STATE, LOCAL, FOREIGN AND OTHER TAX LAWS.
In connection with the exchange offer and merger, Hale and Dorr LLP, our
legal counsel, has rendered a tax opinion to Thermo Instrument that the exchange
offer and the merger of Thermo
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Instrument into us should be treated as one integrated transaction that will
qualify as a "reorganization" within the meaning of Section 368(a) of the
Internal Revenue Code. We and Thermo Instrument gave Hale and Dorr information
about the exchange offer and the merger. Hale and Dorr based their tax opinion
on that information. In addition, Hale and Dorr assumed some facts in giving
their tax opinion, and their opinion contains various qualifications and
limitations. We have filed Hale and Dorr's tax opinion as an exhibit to the
registration statement of which this prospectus is a part. Subject to the
assumptions, limitations and qualifications in the tax opinion, Hale and Dorr is
of the opinion that the exchange offer and the merger should result in the
following federal income tax consequences:
- You will not recognize any gain or loss solely upon the exchange of your
shares of Thermo Instrument common stock for our common stock pursuant to
the exchange offer or the merger, except for any cash you receive in lieu
of fractional shares of our common stock.
- Your aggregate tax basis in our common stock that you receive pursuant to
the exchange offer or the merger will be the same as your aggregate tax
basis in the Thermo Instrument common stock that you tendered, reduced by
the amount of any tax basis attributable to any fractional shares that
you do not actually receive.
- Your holding period for our common stock that you receive pursuant to the
exchange offer or the merger will include the period for which you held
the Thermo Instrument common stock that you exchange for our common
stock, if you held the Thermo Instrument common stock as a capital asset
at the time of the exchange.
- Cash payments that you receive in lieu of a fractional share will be
treated as if that fractional share of our common stock had been issued
pursuant to the exchange offer or the merger and then redeemed by us
after the exchange offer or the merger. You generally will recognize gain
or loss upon any cash you so receive measured by the difference, if any,
between the amount of cash you receive and your basis in that fractional
share.
- Neither we nor Thermo Instrument will recognize gain or loss directly as
a result of the exchange offer or the merger.
We will not, and Thermo Instrument will not, request a ruling from the
Internal Revenue Service in connection with the exchange offer or the merger.
You should be aware that Hale and Dorr's tax opinion will not bind the Internal
Revenue Service. Hale and Dorr relied upon many factual representations by us in
rendering its tax opinion and, in particular, upon our representation that if
the exchange offer is successful, we will cause the merger of Thermo Instrument
with and into us to occur.
Hale and Dorr's tax opinion does not address or consider the tax effect on
you of our proposed spin-offs of our business that serves the healthcare
industry with a range of medical products for diagnosis and monitoring and our
paper recycling and papermaking equipment business. In that regard, we have
requested a ruling from the Internal Revenue Service regarding the tax
consequences of the spin-offs. We expect to proceed with the spin-offs only if
we receive a ruling that the spin-offs will qualify under Section 355 of the
Internal Revenue Code. Accordingly, if the spin-offs occur, we anticipate that
the ruling we receive from the Internal Revenue Service will address the tax
consequences of the spin-offs to our stockholders, including those stockholders
who received their shares pursuant to the exchange offer or the merger. Any
ruling that we receive from the Internal Revenue Service may provide that the
spin-offs could be taxable to some or all of our stockholders, including the
prior stockholders of Thermo Instrument who received our common stock pursuant
to the exchange offer or the merger.
A successful challenge by the Internal Revenue Service to the
reorganization status of the exchange offer and the merger would result in your
recognizing taxable gain or loss on each share of Thermo Instrument common stock
that you exchanged in the exchange offer or the merger. The amount of gain or
loss would be equal to the difference between your basis in that share and the
fair market value, as of the effective time of the exchange, of our common stock
that you received in exchange for that share. In such event, a stockholder's
aggregate basis in our common stock so received would equal its fair market
value as of the effective time of the exchange, and the stockholder's holding
period for such stock would begin the day after the exchange.
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COMPARISON OF THE RIGHTS OF HOLDERS OF OUR COMMON STOCK AND
THE RIGHTS OF HOLDERS OF THERMO INSTRUMENT COMMON STOCK
Upon completion of the exchange offer and the merger, stockholders of
Thermo Instrument will become stockholders of Thermo Electron, rather than
stockholders of Thermo Instrument. Thermo Electron's charter and bylaws will
govern your rights as a stockholder of Thermo Electron. Our charter and bylaws
differ in some important respects from Thermo Instrument's charter and bylaws.
Both Thermo Electron and Thermo Instrument are incorporated under the laws of
the State of Delaware. As Thermo Electron stockholders, the Delaware General
Corporation Law will continue to govern the rights of former Thermo Instrument
stockholders.
The following is a comparison of:
- the current rights of Thermo Instrument stockholders under Thermo
Instrument's charter and bylaws; and
- the rights Thermo Instrument stockholders would have as Thermo Electron
stockholders under Thermo Electron's charter and bylaws after the
completion of the offer and the merger.
The comparison summarizes the material differences but does not list all
differences between the rights of Thermo Electron stockholders and Thermo
Instrument stockholders.
<TABLE>
<CAPTION>
THERMO ELECTRON THERMO INSTRUMENT
--------------------------------------- ---------------------------------------
<S> <C> <C>
BOARD OF DIRECTORS
Classified Board Divided into three classes, as nearly Consists of single class serving a
equal in number as possible, with each one-year term.
class serving a staggered three-year
term.
Removal of Directors Directors may be removed for cause Directors may be removed, with or
only, at any special or annual meeting, without cause, by the holders of a
by the affirmative vote of a majority majority of the shares then entitled to
in number of shares of the stockholders vote at an election of directors.
present in person or by proxy at such
meeting entitled to vote for the
election of such director.
Filling of Board Vacancies on the board of directors may Same.
Vacancies be filled by the vote of a majority of
the directors then in office.
Size of Board The number of directors may be fixed by The number of directors may be fixed by
resolution of the board, but may not be resolution of the board but may not be
less than 3. The current number of less than 2 nor more than 13. The
directors is 9. current number of directors is 2.
ANNUAL MEETING Held on date fixed by the board. Same.
CALLING A SPECIAL Special meetings may be called only by Special meetings may be called only by
MEETING the board of directors, the chairman of the board of directors, the chairman of
the board of directors or the chief the board of directors, the president
executive officer. or any vice president.
</TABLE>
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<TABLE>
<CAPTION>
THERMO ELECTRON THERMO INSTRUMENT
--------------------------------------- ---------------------------------------
<S> <C> <C>
QUORUM REQUIREMENTS The presence in person or by proxy of Same.
the holders of a majority of the shares
entitled to vote at the meeting
constitute a quorum for that meeting,
except as otherwise provided by the
Delaware General Corporation Law.
STOCKHOLDER ACTION BY May take action by written consent of May take action by written consent of
WRITTEN CONSENT stockholders having no less than the stockholders having not less than 50%
minimum number of votes that would be of all of the stock entitled to vote on
necessary to take such action at a the action if a meeting were held.
meeting at which all shares entitled to
vote on the matter were present and
voted.
ADVANCE NOTICE FOR A stockholder must deliver notice of No advance notice provisions.
STOCKHOLDER NOMINATIONS stockholder nominations or proposals to
AND OTHER BUSINESS be made at an annual stockholders
meeting to the secretary not less than
60 days nor more than 75 days before
the first anniversary of the date on
which proxy materials for the preceding
year's annual stockholders meeting were
first mailed. However, if the date of
the annual meeting is moved ahead more
than 30 days before or delayed by more
than 30 days after the anniversary of
the preceding year's annual stockholder
meeting, a stockholder must deliver
notice not later than the close of
business on the later of:
- the 90th day prior to such annual
meeting; or
- the 10th day following the day on
which public announcement of the date
of such meeting is made.
AMENDMENTS TO
ORGANIZATIONAL DOCUMENTS
Certificate of The approval of both our board of Same.
Incorporation directors and the holders of a majority
of our outstanding shares entitled to
vote for the amendment is required for
an amendment to our Certificate of
Incorporation.
</TABLE>
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<TABLE>
<CAPTION>
THERMO ELECTRON THERMO INSTRUMENT
--------------------------------------- ---------------------------------------
<S> <C> <C>
Bylaws The board of directors may amend and The board of directors may amend and
repeal bylaws. The holders of a repeal bylaws. The holders of a
majority of the shares of capital stock majority of the shares of capital stock
issued and outstanding and entitled to issued and outstanding and entitled to
vote, voting together as a single vote, voting together as a single
class, may also amend or repeal any class, may also amend or repeal any
bylaw or may adopt a new bylaw, except bylaw or may adopt a new bylaw.
that the affirmative vote of the
holders of at least two-thirds of the
shares of our capital stock issued and
outstanding and entitled to vote is
required to amend or repeal, or adopt
new bylaws inconsistent with, those
which relate to directors or amending
the bylaws.
CAPITALIZATION
Authorized Common Stock 350 million shares. 250 million shares.
Authorized Preferred 50,000 shares of preferred stock; None.
Stock 40,000 shares of the preferred stock
designated as Series B junior
participating preferred stock, used in
the stockholder rights plan described
below. The board of directors may fix
the rights and preferences of any class
or series of the remaining 10,000
shares of preferred stock. The rights
of the holders of our common stock will
be subject to, and may be adversely
affected by, the rights of holders of
any preferred stock that may be issued
in the future.
RIGHTS PLAN We have a rights agreement dated as of None.
January 19, 1996, which is described
below. The rights agreement is
triggered by, among other things, the
acquisition by a third party of 15% or
more of our total outstanding common
stock without the approval of our board
of directors. The board of directors
may redeem rights at any time until ten
days after a triggering acquisition.
</TABLE>
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<TABLE>
<CAPTION>
THERMO ELECTRON THERMO INSTRUMENT
--------------------------------------- ---------------------------------------
<S> <C> <C>
EXCULPATION AND Certificate of Incorporation provides Bylaws provide indemnification to
INDEMNIFICATION OF indemnification to persons that are or persons that are or were directors,
DIRECTORS, OFFICER AND were directors or officers of ours, or officers, employees or agents of Thermo
EMPLOYEES are or were serving at our request as Instrument, or are or were serving at
directors or officers of another the request of Thermo Instrument as
corporation, partnership, joint directors, officers, employees or
venture, trust or other enterprise, to agents of another corporation,
the fullest extent permitted by partnership, joint venture, trust or
Delaware law. other enterprise, to the fullest extent
permitted by Delaware law.
In the case of any action or suit by us
to procure a judgment in our favor, we In the case of any action or suit by
will indemnify those directors and Thermo Instrument to procure a judgment
officers only for expenses, including in its favor, Thermo Instrument will
attorneys' fees, relating to any claim, indemnify those directors, officers,
issue or matter as to which the employees and agents only for expenses,
director or officer has been judged to including attorneys' fees, relating to
be liable to us, if and only to the any claim, issue or matter as to which
extent that the court determines that, the director or officer has been judged
despite the adjudication of liability to be liable to Thermo Instrument, if
but in view of all of the circumstances and only to the extent that the court
of the case, the director or officer is determines that, despite the
entitled to indemnity for such expenses adjudication of liability but in view
which the court finds proper. of all of the circumstances of the
case, the director or officer is
entitled to indemnity for such expenses
which the court finds proper.
</TABLE>
THERMO ELECTRON STOCKHOLDER RIGHTS PLAN
Under Delaware law, every corporation may create and issue rights entitling
the holders of the rights to purchase from the corporation shares of its capital
stock of any class or classes, subject to any provisions of its certificate of
incorporation. The price and terms of the shares must be stated in the company's
certificate of incorporation or in a resolution adopted by the board of
directors for the creation or issuance of such rights.
We entered into a rights agreement dated as of January 19, 1996 with
BankBoston, N.A. as rights agent. On January 19, 1996, our board declared a
dividend distribution of one right for each outstanding share of our common
stock to our stockholders. Each right entitles the registered holder to purchase
from us a unit consisting of one ten-thousandth of a share of Series B junior
participating preferred stock at a purchase price of $250.00 in cash per unit,
subject to adjustment.
The following description is a summary of all the material terms of our
stockholder rights plan. It does not restate these terms in their entirety. We
urge you to read our stockholder rights plan because it, and not this
description, defines the terms and provisions of our plan. We have filed a copy
of the rights agreement that established our rights plan as an exhibit to our
Registration Statement on Form 8-A, which we filed with the SEC on January 26,
1996 and which we incorporate by reference into the registration statement which
includes this prospectus. You may obtain a copy of the rights agreement at no
charge by writing to us at the address listed below under the caption "Where You
Can Find More Information."
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<PAGE> 55
Distribution of rights. Initially, the rights attach to all of our
outstanding common stock certificates and we will not distribute separate rights
certificates. The rights will separate from our common stock, and a distribution
date will occur, upon the earlier of the following events:
- 10 days after a public announcement that a person or group of affiliated
or associated persons has acquired, or obtained the right to acquire,
beneficial ownership of 15% or more of the outstanding shares of our
common stock; and
- 10 business days following the start of a tender offer or exchange offer
that would result in a person or group beneficially owning 15% or more of
the outstanding shares of our common stock.
Until the distribution date:
- the rights will be evidenced by our common stock certificates and will be
transferred only with our common stock certificates;
- new common stock certificates of ours will incorporate the rights
agreement by reference; and
- the surrender for transfer of any certificates of our common stock will
also transfer the rights associated with our common stock represented by
the certificate.
The rights are not exercisable until the distribution date and will expire
at the close of business on January 29, 2006, unless we redeem or exchange them
earlier as described below.
Flip in event. If a person becomes the beneficial owner of 15% or more of
the shares of our common stock, each holder of a right will thereafter have the
right to receive, upon exercise, a number of shares of our common stock, or, in
some circumstances, cash, property or other securities of ours, which equals the
exercise price of the right divided by one-half of the current market price of
our common stock on the date the acquisition occurs. However, following the
acquisition:
- rights are not exercisable until the rights are no longer redeemable by
us as set forth below; and
- all rights that are, or were, under the circumstances specified in the
rights agreement, beneficially owned by any acquiring person will be null
and void.
The event set forth in this paragraph is referred to as a "section 11(a)(ii)
event." A section 11(a)(ii) event does not occur if there is an offer for all of
our outstanding shares of common stock that our board of directors determines is
fair to our stockholders and in their best interests.
For example, at an exercise price of $250 per right, each right not owned
by an acquiring person, or by some related parties, following a section
11(a)(ii) event would entitle the holder to purchase for $250 the number of
shares of our common stock, or other consideration, as noted above, as equals
$250 divided by one-half of the current market price of our common stock.
Assuming that our common stock had a per share value of $50 at that time, the
holder of each valid right would be entitled to purchase ten shares of our
common stock for $250.
Flip over event. If at any time after a person has become an acquiring
person:
- we are acquired in a merger or other business combination transaction in
which we are not the surviving corporation, or our common stock is
changed or exchanged, or
- 50% or more of our assets or earning power is sold or transferred,
then each holder of a right, except rights which previously have been voided as
set forth above, shall thereafter have the right to receive, upon exercise, that
number of shares of common stock of the acquiring company which equals the
exercise price of the right divided by one-half of the current market price of
that company's common stock at the date of the occurrence of the event. This
exercise right does not arise if the merger or other transaction follows an
offer for all of our outstanding shares of common stock that our board of
directors determines is fair to our stockholders and in their best interests.
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<PAGE> 56
For example, at an exercise price of $250 per right, each right following
an event described in the preceding paragraph would entitle the holder to
purchase for $250 the number of shares of common stock of the acquiring company
as equals $250 divided by one-half of the current market price of that company's
common stock. Assuming that the common stock had a per share value of $100 at
that time, the holder of each valid right would be entitled to purchase five
shares of common stock of the acquiring company for $250.
Exchange of rights. At any time after a section 11(a)(ii) event, our board
of directors may exchange the rights, other than rights owned by the acquiring
person that have become void, in whole or in part, at an exchange ratio of one
share of our common stock, or one ten-thousandth of a share of preferred stock,
or of a share of a class or series of our preferred stock having equivalent
rights, preferences and privileges, per right.
Series B junior participating preferred stock. Preferred stock purchasable
upon exercise of the rights will not be redeemable. Each share of preferred
stock will be entitled to a minimum preferential quarterly dividend payment of
$100 per share and will be entitled to an aggregate dividend of 10,000 times the
dividend declared per share of our common stock. In the event of liquidation,
the holders of the preferred stock will be entitled to a minimum preferential
liquidating payment of $100 per share and will be entitled to an aggregate
payment of 10,000 times the payment made per share of our common stock. Each
share of preferred stock will have 10,000 votes, voting together with our common
stock. Finally, in the event of any merger, consolidation or other transaction
in which our common stock is changed or exchanged, each share of preferred stock
will be entitled to receive 10,000 times the amount received per share of our
common stock.
These rights are protected by customary antidilution provisions and, in
light of our stock dividend in 1996, currently provide for the following:
- an aggregate dividend per share of preferred stock of 15,000 times the
dividend declared per share of our common stock;
- an aggregate payment per share of preferred stock, in the event of
liquidation, of 15,000 times the payment made per share of our common
stock; and
- 15,000 votes per share of preferred stock, voting together with our
common stock.
Because of the nature of the preferred stock's dividend, liquidation and
voting rights, the value of one ten-thousandth of a share of preferred stock
purchasable upon exercise of each right should approximate the value of one
share of our common stock.
Redemption of rights. At any time until ten days following the stock
acquisition date, we may redeem the rights in whole, but not in part, at a price
of $.01 per right, payable in cash or stock. Immediately upon an action of our
board of directors ordering redemption of the rights, the rights will terminate
and the only right of the holders of rights will be to receive the $.01
redemption price.
Status of rights holder and tax effects. Until a right is exercised, the
holder of the right, as such, will have no rights as a stockholder of ours,
including the right to vote or to receive dividends. Although the distribution
of the rights is not taxable to stockholders or to us, stockholders may,
depending upon the circumstances, recognize taxable income in the event that the
rights become exercisable for our common stock, or other consideration, or for
common stock of the acquiring company as described above.
Effects of the rights. The rights are intended to have anti-takeover
effects. The rights will cause substantial dilution to a person or group that
attempts to acquire us without conditioning the offer on a substantial number of
rights being acquired. The rights, however, should not affect any prospective
offeror willing to make an offer at a fair price and otherwise in the best
interests of us and our stockholders, as determined by a majority of our board
of directors. The rights should not interfere with any merger or
53
<PAGE> 57
other business combination approved by our board of directors because the board
of directors may, at its option, at any time prior to the close of business on
the earlier of:
- the tenth day following the stock acquisition date, or
- January 29, 2006,
and in other specified circumstances, redeem all of the then outstanding rights
at the redemption price.
DELAWARE ANTI-TAKEOVER STATUTE
Both we and Thermo Instrument are subject to Section 203 of the Delaware
General Corporation Law, which may make it more difficult for a person who would
be an "interested stockholder," as defined in Section 203, in either company, to
effect various business combinations with that company for a three-year period
after becoming an interested stockholder. Under Delaware law, a corporation's
certificate of incorporation or bylaws may exclude a corporation from the
restrictions imposed by Section 203. Neither our nor Thermo Instrument's
certificate of incorporation and bylaws exclude the company from the
restrictions imposed by Section 203.
TRANSACTIONS WITH RELATED PARTIES
PRIOR CONTACTS
Except as set forth in, or incorporated by reference in, this prospectus,
since January 1, 1998, there have been no contacts, negotiations or transactions
between us, on the one hand, and Thermo Instrument or any of its officers,
directors or affiliates, on the other hand, concerning a merger, consolidation
or acquisition, a tender offer or other acquisition of securities, an election
of directors or a sale or other transfer of a material amount of assets.
PRIOR BUSINESS RELATIONSHIPS
Except as set forth in, or incorporated by reference in, this prospectus,
we have not, since January 1, 1998, had any business relationships or
transactions with Thermo Instrument or any of its executive officers, directors
or affiliates that would require disclosure in this prospectus under the SEC's
rules.
LEGAL MATTERS
Seth H. Hoogasian, Esq., our General Counsel, will pass on the validity of
the shares of our common stock offered by this prospectus. Mr. Hoogasian is a
full-time employee and officer of Thermo Electron, is an officer of Thermo
Instrument and, as of June 26, 2000, owned or had the right to acquire 396,754
shares of our common stock and 105,200 shares of the common stock of our
subsidiaries.
EXPERTS
Our financial statements and those of Thermo Instrument that we incorporate
by reference in this prospectus and the financial statement schedules that we
incorporated by reference in the registration statement of which this prospectus
is a part have been audited by Arthur Andersen LLP, independent public
accountants, to the extent and for the periods as indicated in their reports
with respect thereto, and are incorporated by reference in reliance upon the
authority of said firm as experts in giving said reports.
54
<PAGE> 58
WHERE YOU CAN FIND MORE INFORMATION
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE, INCLUDING IMPORTANT
BUSINESS AND FINANCIAL INFORMATION, WHICH ARE NOT PRESENTED IN OR DELIVERED WITH
THIS PROSPECTUS.
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS DOCUMENT OR IN
DOCUMENTS TO WHICH WE HAVE REFERRED YOU. WE HAVE NOT AUTHORIZED ANYONE TO
PROVIDE YOU WITH ANY INFORMATION THAT IS DIFFERENT.
THERMO INSTRUMENT
We incorporate by reference into this prospectus the following documents,
filed by Thermo Instrument (File No. 1-9786) with the SEC:
- Thermo Instrument's Annual Report on Form 10-K for the fiscal year ended
January 1, 2000;
- Thermo Instrument's Quarterly Report on Form 10-Q for the fiscal quarter
ended April 1, 2000; and
- Thermo Instrument's Current Reports on Form 8-K dated February 1, 2000,
April 7, 2000, April 13, 2000, April 27, 2000, May 2, 2000 and May 11,
2000.
THERMO ELECTRON
We incorporate by reference into this prospectus the following documents,
which we have filed (File No. 1-8002) with the SEC:
- Our Annual Report on Form 10-K for the fiscal year ended January 1, 2000
as amended by our Form 10-K/A filed on June 27, 2000;
- Our Current Reports on Form 8-K dated February 1, 2000, May 2, 2000 and
June 14, 2000;
- Our Quarterly Report on Form 10-Q for the fiscal quarter ended April 1,
2000;
- Our Proxy Statement dated April 19, 2000, filed with the SEC on April 21,
2000;
- The description of our common stock which is contained in our
registration statement on Form 8-A and the amendment to that registration
statement, filed under the Exchange Act; and
- The description of our preferred stock purchase rights which is contained
in our registration statement on Form 8-A and the amendments to that
registration statement, filed under the Exchange Act.
All documents that we file or that Thermo Instrument files pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act from the date of this
prospectus to the date that shares are accepted for exchange pursuant to our
offer, the date that our offer is terminated or the date that the merger is
closed will also be deemed to be incorporated in this prospectus by reference.
The information incorporated by reference in this prospectus is deemed to
be a part of this prospectus, except for any information superseded by
information in this prospectus or in any subsequently filed document that we
incorporate by reference in this prospectus.
We will provide a copy of any and all of the information that we
incorporate by reference in this prospectus to any person, without charge, upon
written or oral request. If we do not specifically incorporate by reference
exhibits to the documents that we incorporate by reference in this prospectus,
then we will not provide copies of those exhibits. TO OBTAIN TIMELY DELIVERY,
YOU MUST REQUEST THE INFORMATION NO LATER THAN JUNE 22, 2000.
You should direct requests for documents relating to Thermo Instrument or
to us to: Sandra L. Lambert, Corporate Secretary, Thermo Electron Corporation,
81 Wyman Street, Waltham, Massachusetts 02454 (telephone: 781-622-1000;
facsimile: 781-768-6620).
55
<PAGE> 59
We file reports, proxy statements and other information with the SEC. You
may inspect and copy our reports, proxy statements and other information at the
public reference facilities maintained by the SEC at:
<TABLE>
<S> <C> <C>
Judiciary Plaza Citicorp Center Seven World Trade Center
Room 1024 500 West Madison Street 13th Floor
450 Fifth Street, N.W. Suite 1400 New York, New York 10048
Washington, D.C. 20549 Chicago, Illinois 60661
</TABLE>
You can also inspect reports, proxy statements and other information
concerning Thermo Instrument at:
The American Stock Exchange
86 Trinity Place
New York, New York 10006-1881
You can also inspect reports, proxy statements and other information
concerning us at:
The New York Stock Exchange
20 Broad Street
New York, New York 10005
You can also obtain copies of these materials by mail at prescribed rates
from the Public Reference Room at the SEC, 450 Fifth Street, N.W., Washington,
D.C. 20549. You may obtain information on the operation of the Public Reference
Room by calling the SEC toll-free at l-800-SEC-0330. The SEC maintains an
Internet site that contains reports, proxy statements and other information
regarding Thermo Electron and Thermo Instrument. The address of the SEC website
is http://www.sec.gov.
We have filed a registration statement on Form S-4 under the Securities Act
with the SEC with respect to our common stock we would issue to Thermo
Instrument stockholders in the exchange offer and the merger. This prospectus
constitutes our prospectus filed as part of the registration statement. This
prospectus does not contain all of the information set forth in the registration
statement because we have omitted parts of the registration statement in
accordance with the SEC's rules. The registration statement and its exhibits are
available for inspection and copying as set forth above.
We have also filed with the SEC a statement on Schedule TO pursuant to Rule
14d-3 under the Exchange Act furnishing information about the exchange offer.
You may read and copy the Schedule TO and any amendments thereto at the SEC's
public reference room in Washington, D.C. referred to above.
If you have any questions about the exchange offer, you should call the
information agent, D.F. King & Co., Inc. If you are a banker or broker, call
collect at (212) 269-5550. All others should call toll-free at (800) 290-6433.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF
AN OFFER TO PURCHASE, THE SECURITIES OFFERED BY THIS PROSPECTUS, IN ANY
JURISDICTION OR FROM ANY PERSON TO WHOM OR FROM WHOM IT IS UNLAWFUL TO MAKE SUCH
OFFER OR SOLICITATION OF AN OFFER IN SUCH JURISDICTION. NEITHER THE DELIVERY OF
THIS PROSPECTUS NOR ANY DISTRIBUTION OF SECURITIES PURSUANT TO THIS PROSPECTUS
SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE INFORMATION SET FORTH OR INCORPORATED INTO THIS PROSPECTUS BY
REFERENCE OR IN OUR AFFAIRS SINCE THE DATE OF THIS PROSPECTUS.
56
<PAGE> 60
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<PAGE> 61
THERMO ELECTRON CORPORATION
INDEX TO PRO FORMA CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
<TABLE>
<CAPTION>
PAGE
<S> <C>
Pro Forma Consolidated Condensed Financial Information of
Thermo Electron Corporation (Unaudited)................... F-2
Pro Forma Consolidated Condensed Statement of Continuing
Operations for the three months ended April 1, 2000....... F-3
Pro Forma Consolidated Condensed Statement of Operations for
the fiscal year ended January 1, 2000..................... F-4
Pro Forma Consolidated Condensed Balance Sheet as of April
1, 2000................................................... F-5
Notes to Pro Forma Consolidated Condensed Financial
Statements................................................ F-6
</TABLE>
F-1
<PAGE> 62
THERMO ELECTRON CORPORATION
PRO FORMA CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
The following unaudited pro forma consolidated condensed statement of
operations sets forth our results of operations for the three months ended April
1, 2000, and the fiscal year ended January 1, 2000, as if we had completed the
exchange offer and the merger at the beginning of fiscal 1999. The following
unaudited pro forma consolidated condensed balance sheet sets forth our
financial position as of April 1, 2000, as if we had completed the exchange
offer and the merger on April 1, 2000. For purposes of determining the number of
shares of our common stock that we will issue in the exchange offer and the
merger, we have used the exchange ratio of 0.85 shares of our common stock for
each share of Thermo Instrument common stock. The pro forma results of
operations are not necessarily indicative of future operations or the actual
results that would have occurred if we had completed the exchange offer and the
merger at the beginning of fiscal 1999.
F-2
<PAGE> 63
THERMO ELECTRON CORPORATION
PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF CONTINUING OPERATIONS
THREE MONTHS ENDED APRIL 1, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
PRO FORMA
HISTORICAL ADJUSTMENTS PRO FORMA
----------- ------------ ----------
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C>
Revenues $598,929 $ -- $598,929
-------- ------- --------
Costs and Operating Expenses:
Cost of revenues........................................ 325,183 -- 325,183
Selling, general and administrative expenses............ 173,682 1,025 174,707
Research and development expenses....................... 48,446 -- 48,446
Restructuring and other unusual costs, net.............. (7,700) -- (7,700)
-------- ------- --------
539,611 1,025 540,636
-------- ------- --------
Operating Income.......................................... 59,318 (1,025) 58,293
Other Expense, Net........................................ (21,172) -- (21,172)
-------- ------- --------
Income from Continuing Operations Before Income Taxes,
Minority Interest and Extraordinary Items............... 38,146 (1,025) 37,121
Income Tax Provision...................................... 16,728 -- 16,728
Minority Interest Expense................................. 6,127 2,285 3,842
-------- ------- --------
Income from Continuing Operations Before Extraordinary
Items................................................... $ 15,291 $ 1,260 $ 16,551
======== ======= ========
Earnings per Share from Continuing Operations Before
Extraordinary Items:
Basic................................................... $ .10 $ .10
======== ========
Diluted................................................. $ .09 $ .09
======== ========
Weighted Average Shares:
Basic................................................... 156,813 12,545 169,358
======== ======= ========
Diluted................................................. 157,464 12,545 170,009
======== ======= ========
</TABLE>
F-3
<PAGE> 64
THERMO ELECTRON CORPORATION
PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
FISCAL YEAR ENDED JANUARY 1, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
PRO FORMA
HISTORICAL ADJUSTMENTS PRO FORMA
---------- ----------- ----------
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C>
Revenues $2,471,193 $ -- $2,471,193
---------- ------- ----------
Costs and Operating Expenses:
Cost of revenues..................................... 1,378,494 -- 1,378,494
Selling, general and administrative expenses......... 673,004 4,099 677,103
Research and development expenses.................... 171,100 -- 171,100
Restructuring and other unusual costs, net........... 149,589 -- 149,589
---------- ------- ----------
2,372,187 4,099 2,376,286
---------- ------- ----------
Operating Income....................................... 99,006 (4,099) 94,907
Other Expense, Net..................................... (61,520) -- (61,520)
---------- ------- ----------
Income from Continuing Operations Before Income Taxes,
Minority Interest and Extraordinary Items............ 37,486 (4,099) 33,387
Income Tax Provision................................... 33,073 -- 33,073
Minority Interest Expense.............................. 18,993 11,332 7,661
---------- ------- ----------
Loss from Continuing Operations Before Extraordinary
Items................................................ $ (14,580) $ 7,233 $ (7,347)
========== ======= ==========
Loss per Share from Continuing Operations Before
Extraordinary Items:
Basic................................................ $ (.09) $ (.04)
========== ==========
Diluted.............................................. $ (.11) $ (.06)
========== ==========
Basic and Diluted Weighted Average Shares.............. 157,987 12,545 170,532
========== ======= ==========
</TABLE>
F-4
<PAGE> 65
THERMO ELECTRON CORPORATION
PRO FORMA CONSOLIDATED CONDENSED BALANCE SHEET
APRIL 1, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
PRO FORMA
HISTORICAL ADJUSTMENTS PRO FORMA
---------- ----------- ----------
(IN THOUSANDS)
<S> <C> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents............................ $ 533,471 $ -- $ 533,471
Short-term available-for-sale investments, at quoted
market value...................................... 426,015 -- 426,015
Accounts receivable, net............................. 534,569 -- 534,569
Other current assets................................. 690,103 -- 690,103
Net assets of discontinued operations................ 502,629 -- 502,629
---------- --------- ----------
2,686,787 -- 2,686,787
---------- --------- ----------
Property, Plant and Equipment, at Cost, Net............ 424,874 -- 424,874
---------- --------- ----------
Other Assets........................................... 233,486 -- 233,486
---------- --------- ----------
Cost in Excess of Net Assets of Acquired Companies..... 1,206,238 163,962 1,370,200
---------- --------- ----------
Long-term Net Assets of Discontinued Operations........ 625,802 -- 625,802
---------- --------- ----------
$5,177,187 $ 163,962 $5,341,149
========== ========= ==========
LIABILITIES AND SHAREHOLDERS' INVESTMENT
Current Liabilities.................................... $1,057,399 $ -- $1,057,399
---------- --------- ----------
Deferred Income Taxes and Other Deferred Items......... 162,622 -- 162,622
---------- --------- ----------
Long-term Obligations:
Subordinated convertible obligations................. 1,184,033 -- 1,184,033
Other................................................ 386,290 -- 386,290
---------- --------- ----------
1,570,323 -- 1,570,323
---------- --------- ----------
Minority Interest...................................... 364,900 (128,907) 235,993
---------- --------- ----------
Common Stock of Subsidiary Subject to Redemption....... 7,692 -- 7,692
---------- --------- ----------
Shareholders' Investment:
Common stock......................................... 167,990 12,545 180,535
Capital in excess of par value....................... 1,061,754 280,324 1,342,078
Retained earnings.................................... 1,057,791 -- 1,057,791
Treasury stock at cost............................... (193,457) -- (193,457)
Deferred compensation................................ (6,917) -- (6,917)
Accumulated other comprehensive items................ (72,910) -- (72,910)
---------- --------- ----------
2,014,251 292,869 2,307,120
---------- --------- ----------
$5,177,187 $ 163,962 $5,341,149
========== ========= ==========
</TABLE>
F-5
<PAGE> 66
THERMO ELECTRON CORPORATION
NOTES TO PRO FORMA CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
<TABLE>
NOTE 1 -- PRO FORMA ADJUSTMENTS TO PRO FORMA CONSOLIDATED
CONDENSED STATEMENT OF OPERATIONS (IN THOUSANDS
EXCEPT IN TEXT)
THREE MONTHS
ENDED
APRIL 1, YEAR ENDED
2000 JANUARY 1, 2000
------------ ---------------
DEBIT (CREDIT)
<S> <C> <C>
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Amortization of cost in excess of net assets of acquired
companies created by the acquisition of additional shares
of Thermo Instrument...................................... $ 1,025 $ 4,099
-------- ---------
MINORITY INTEREST EXPENSE
Decrease in minority interest expense as a result of our
increased ownership of Thermo Instrument.................. $ (2,285) $ (11,332)
-------- ---------
WEIGHTED AVERAGE SHARES
Increase in weighted average shares outstanding due to the
assumed issuance of 12,545,187 shares of our common stock
for the acquisition of additional shares of Thermo
Instrument as of the beginning of 1999.................... 12,545 12,545
-------- ---------
NOTE 2 -- PRO FORMA ADJUSTMENTS TO PRO FORMA CONSOLIDATED
CONDENSED BALANCE SHEET (IN THOUSANDS EXCEPT IN
TEXT)
APRIL 1,
2000
--------
DEBIT (CREDIT)
COST IN EXCESS OF NET ASSETS OF ACQUIRED COMPANIES
Increase in cost in excess of net assets of acquired
companies as a result of our increased ownership of Thermo
Instrument................................................ $163,962
--------
MINORITY INTEREST
Decrease in minority interest as a result of our increased
ownership of Thermo Instrument............................ 128,907
--------
COMMON STOCK
Increase in common stock due to the assumed issuance of
12,545,187 shares of our common stock for the acquisition
of additional shares of Thermo Instrument................. (12,545)
--------
CAPITAL IN EXCESS OF PAR VALUE
Increase in capital in excess of par value as a result of
our increased ownership of Thermo Instrument and the
conversion of outstanding stock options of Thermo
Instrument into our stock options......................... (280,324)
--------
</TABLE>
F-6
<PAGE> 67
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<PAGE> 68
ANNEX A
DIRECTORS AND EXECUTIVE OFFICERS OF THERMO ELECTRON
AND THERMO INSTRUMENT
THERMO ELECTRON
We have set forth in the following table:
- the name, business address, position with Thermo Electron, present
principal occupation or employment and five-year employment history of
each of our directors and executive officers; and
- the names, principal businesses and addresses of any corporations or
other organizations in which those principal occupations are conducted.
Unless otherwise indicated, each occupation listed in the table refers to
Thermo Electron, each individual is a United States citizen and each
individual's business address is 81 Wyman Street, Waltham, Massachusetts 02454.
Unless otherwise indicated, to our knowledge, none of our directors or
executive officers beneficially owns any shares of our common stock or Thermo
Instrument common stock or rights to acquire shares of our common stock or
Thermo Instrument common stock. Unless otherwise indicated, to our knowledge,
none of our directors or executive officers has been convicted in a criminal
proceeding during the last five years, excluding traffic violations or similar
misdemeanors, and none of our directors or executive officers was a party to any
judicial or administrative proceeding during the last five years that resulted
in a judgement, decree or final order enjoining the person from future
violations of, or prohibiting activities subject to, federal or state securities
laws, or a finding of any violation of federal or state securities laws.
Mr. John N. Hatsopoulos retired from our board of directors effective
February 21, 2000. Dr. George N. Hatsopoulos retired from our board of directors
effective March 31, 2000. Mr. Roger D. Wellington retired from our board of
directors effective May 17, 2000.
SAMUEL W. BODMAN................... Dr. Bodman, 61, has been a director of
Thermo Electron since May 1999. Since
1988, Dr. Bodman has served as the
chairman and chief executive officer of
Cabot Corporation, a manufacturer of
specialty chemicals and materials located
at 75 State Street, Boston, MA 02109. Dr.
Bodman is also a director of Cabot
Corporation, John Hancock Financial
Services, Inc., Security Capital Group
Incorporated and Westvaco Corporation.
PETER O. CRISP..................... Mr. Crisp, 67, has been a director of
Thermo Electron since 1974. Mr. Crisp was
a general partner of Venrock Associates,
a venture capital investment firm located
at 30 Rockefeller Plaza, New York, NY
10112, for more than five years until his
retirement in September 1997. He has been
the vice chairman of Rockefeller
Financial Services, Inc. since December
1997. Mr. Crisp is also a director of
American Superconductor Corporation,
Evans & Sutherland Computer Corporation,
Thermedics Inc., ThermoTrex Corporation
and United States Trust Corporation.
ELIAS P. GYFTOPOULOS............... Dr. Gyftopoulos, 72, has been a director
of Thermo Electron since 1976. Dr.
Gyftopoulos is Professor Emeritus of the
Massachusetts Institute of Technology,
where he was the Ford Professor of
Mechanical Engineering
A-1
<PAGE> 69
and of Nuclear Engineering for more than
20 years until his retirement in 1996.
Dr. Gyftopoulos is also a director of
Thermo Cardiosystems Inc., ThermoLase
Corporation and Trex Medical Corporation.
FRANK JUNGERS...................... Mr. Jungers, 73, has been a director of
Thermo Electron since 1978. Mr. Jungers
has been a consultant on business and
energy matters since 1977. His business
address is 822 N.W. Murray Boulevard,
Suite 242, Portland, OR 97229. Mr.
Jungers is also a director of The AES
Corporation, Donaldson, Lufkin &
Jenrette, Inc., Statia Terminals Group
N.V. and Thermo Ecotek Corporation.
JIM P. MANZI....................... Mr. Manzi, 48, was the chairman,
president and chief executive officer of
Lotus Development Corporation, a software
manufacturer, from 1984 until 1995. Since
leaving Lotus, he has been involved in a
number of technology startup ventures,
primarily related to the Internet.
ROBERT A. MCCABE................... Mr. McCabe, 65, has been a director of
Thermo Electron since 1962. He has been
the chairman of Pilot Capital Corporation
located at 444 Madison Avenue, Suite
2103, New York, NY 10022, which is
engaged in private investments, since
1998. Mr. McCabe was the president of
Pilot Capital Corporation from 1987 to
1998. Mr. McCabe is also a director of
Atlantic Bank & Trust Company, Burns
International Services Corporation and
Church & Dwight Company.
HUTHAM S. OLAYAN................... Ms. Olayan, 46, has been a director of
Thermo Electron since 1987. She has
served since 1995 as president and a
director of Olayan America Corporation, a
member of the Olayan Group, and as
president and a director of Competrol
Real Estate Limited, another member of
the Olayan Group, from 1986 until its
merger into Olayan America Corporation in
1997. The surviving company, which is
located at 505 Park Avenue, Suite 1100,
New York, NY 10022, is engaged in private
investments, including real estate, and
advisory services. Ms. Olayan is also a
director of Trex Medical Corporation. Ms.
Olayan is a citizen of Saudi Arabia.
ROBERT W. O'LEARY.................. Mr. O'Leary, 56, has been a director of
Thermo Electron since June 1998. He has
been the president and chairman of
Premier, Inc., a strategic alliance of
not-for-profit health care and hospital
systems located at 12225 El Camino Real,
San Diego, CA 92130, since 1995.
RICHARD F. SYRON................... Dr. Syron, 56, has been a director of
Thermo Electron since September 1997, its
president and chief executive officer
since June 1999 and chairman of the board
since January 2000. From April 1994 until
May 1999, Dr. Syron was the chairman and
chief executive officer
A-2
<PAGE> 70
of the American Stock Exchange Inc.
located at 86 Trinity Place, New York, NY
10006-1881. Dr. Syron is also a director
of Dreyfus Corporation, John Hancock
Financial Services, Inc., and Thermo
Fibertek Inc.
BRIAN D. HOLT...................... Mr. Holt, 51, became the chief operating
officer, energy and environment, of
Thermo Electron in September 1998. Mr.
Holt has been the president and chief
executive officer of Thermo Ecotek
Corporation, a majority-owned subsidiary
of Thermo Electron located at 245 Winter
Street, Waltham, MA 02451, that is
involved in electric power generation
since February 1994. From March 1996 to
September 1998, he was a vice president
of Thermo Electron. Mr. Holt is also a
director of Thermo Ecotek Corporation and
Thermo TerraTech Inc.
JOHN T. KEISER..................... Mr. Keiser, 64, became chief operating
officer, biomedical, of Thermo Electron
in September 1998 and was a vice
president from April 1997 until his
promotion. Mr. Keiser has been the
president and chief executive officer of
Thermedics Inc., a manufacturer of
biomedical products, product
quality-assurance systems and security
devices, since March 1998 and December
1998, respectively, and served as a
senior vice president of Thermedics Inc.
from 1994 until his promotion to
president. He has also been the president
of Thermo Electron's wholly owned
biomedical group, a manufacturer of
medical equipment and instruments, since
1994. Mr. Keiser is a director of
Thermedics Inc., Thermo Cardiosystems
Inc., ThermoLase Corporation, ThermoTrex
Corporation and Trex Medical Corporation.
EARL R. LEWIS...................... Mr. Lewis, 56, became chief operating
officer, measurement and detection, of
Thermo Electron in September 1998, and
served as senior vice president of Thermo
Electron from June 1998 to September 1998
and vice president from September 1996 to
June 1998. Mr. Lewis has been president
and chief executive officer of Thermo
Instrument since March 1997 and January
1998, respectively, and was chief
operating officer from January 1996 to
January 1998. Prior to that time, he was
executive vice president of Thermo
Instrument from January 1996 to March
1997 and senior vice president from
January 1994 to January 1996. Mr. Lewis
served as chief executive officer of
Thermo Optek Corporation, a subsidiary of
Thermo Instrument and a manufacturer of
analytical instruments that measure
energy and light for purposes of
materials analysis, characterization and
preparation, from its inception in August
1995 to January 1998. Mr. Lewis is a
director of FLIR Systems Inc., SpectRx
Inc. and Spectra-Physics Lasers, Inc.
A-3
<PAGE> 71
THEO MELAS-KYRIAZI................. Mr. Melas-Kyriazi, 40, has been a vice
president, of Thermo Electron since March
1998 and its chief financial officer
since January 1999. Prior to his
appointment as a vice president of Thermo
Electron, Mr. Melas-Kyriazi served as
president and chief executive officer of
ThermoSpectra Corporation, a subsidiary
of Thermo Instrument that develops,
manufactures, and markets precision
imaging, inspection, measurement, and
temperature-control instrumentation, from
its inception in August 1994 until March
1998. Mr. Melas-Kyriazi is a citizen of
Greece.
WILLIAM A. RAINVILLE............... Mr. Rainville, 58, became chief operating
officer, recycling and resource recovery,
of Thermo Electron in September 1998. Mr.
Rainville was a senior vice president of
Thermo Electron from March 1993 to
September 1998, and a vice president of
Thermo Electron from 1986 to 1993. He has
been president and chief executive
officer of Thermo Fibertek Inc., a
majority-owned subsidiary of Thermo
Electron located at 245 Winter Street,
Waltham, MA 02451 that develops and
manufactures equipment and products for
the papermaking and paper-recycling
industries, since its inception in 1991.
Mr. Rainville is also a director of
Thermo Ecotek Corporation, Thermo
Fibergen Inc., Thermo Fibertek Inc. and
Thermo TerraTech Inc.
Stock Ownership. The following table sets forth the beneficial ownership
of common stock of Thermo Instrument and Thermo Electron, as of January 31,
2000, with respect to each of our directors and executive officers. Our
directors and executive officers disclaim beneficial ownership of the shares of
Thermo Instrument common stock beneficially owned by us.
<TABLE>
<CAPTION>
THERMO THERMO
ELECTRON INSTRUMENT
NAME(1) CORPORATION(2) SYSTEMS INC.(3)
------- -------------- ---------------
<S> <C> <C>
Samuel W. Bodman............................................ 27,599 0
Peter O. Crisp.............................................. 121,767 3,009
Elias P. Gyftopoulos........................................ 91,399 88,842
Brian D. Holt............................................... 322,941 999
Frank Jungers............................................... 171,021 26,412
John T. Keiser.............................................. 331,636 155,211
Earl R. Lewis............................................... 215,477 436,499
Jim P. Manzi................................................ 0 0
Robert A. McCabe............................................ 66,326 46,846
Theo Melas-Kyriazi.......................................... 458,532 182,715
Hutham S. Olayan............................................ 49,568 3,009
Robert W. O'Leary........................................... 43,830 666
William A. Rainville........................................ 361,499 19,065
Richard F. Syron............................................ 1,074,006 0
All directors and current executive officers as a group (14
persons).................................................. 3,335,601 963,273
</TABLE>
---------------
(1) Except as reflected in the footnotes to this table, shares beneficially
owned consist of shares owned by the indicated person or by that person for
the benefit of minor children, and all share ownership includes sole voting
and investment power.
A-4
<PAGE> 72
(2) Shares of the Common Stock of Thermo Electron beneficially owned by Dr.
Bodman, Mr. Crisp, Dr. Gyftopoulos, Mr. Holt, Mr. Jungers, Mr. Keiser, Mr.
Lewis, Mr. McCabe, Mr. Melas-Kyriazi, Ms. Olayan, Mr. O'Leary, Mr.
Rainville, Dr. Syron and all directors and current executive officers as a
group include 26,000, 25,596, 27,442, 284,948, 24,673, 263,230, 212,278,
27,442, 384,361, 27,442, 27,000, 294,630, 1,011,000 and 2,636,042 shares,
respectively, that such person or members of the group have the right to
acquire within 60 days of January 31, 2000 through the exercise of stock
options. Shares beneficially owned by Mr. Melas-Kyriazi and all directors
and current executive officers as a group include 1,071 shares allocated to
Mr. Melas-Kyriazi's account maintained pursuant to the Thermo Electron's
employee stock ownership plan (the "ESOP"). Shares beneficially owned by Dr.
Bodman, Mr. Crisp, Dr. Gyftopoulos, Mr. Jungers, Mr. McCabe, Ms. Olayan, Mr.
O'Leary, Dr. Syron and all directors and current executive officers as a
group include 1,599, 49,277, 1,378, 80,427, 34,725, 19,876, 3,830, 2,506 and
193,618 shares, respectively, allocated to accounts maintained pursuant to
Thermo Electron's deferred compensation plan for directors. Shares
beneficially owned by Ms. Olayan do not include 6,150,000 shares owned by
Crescent Holding GmbH, a member of the Olayan Group. Crescent Holding GmbH
is indirectly controlled by Suliman S. Olayan, Ms. Olayan's father. Ms.
Olayan disclaims beneficial ownership of the shares owned by Crescent
Holding GmbH. No director or current executive officer beneficially owned
more than 1% of the Thermo Electron common stock outstanding as of such
date; all directors and current executive officers as a group beneficially
owned 2.13% of the Thermo Electron common stock outstanding as of January
31, 2000.
(3) Shares of the common stock of Thermo Instrument beneficially owned by Mr.
Crisp, Dr. Gyftopoulos, Mr. Holt, Mr. Jungers, Mr. Keiser, Mr. Lewis, Mr.
McCabe, Mr. Melas-Kyriazi, Ms. Olayan, Mr. O'Leary, Mr. Rainville and all
directors and current executive officers as a group include 3,009, 40,586,
999, 11,443, 71,311, 409,081, 7,925, 163,687, 3,009, 666, 19,065 and 730,790
shares, respectively, that such person or members of the group have the
right to acquire within 60 days of January 31, 2000 through the exercise of
stock options. Shares beneficially owned by Mr. Melas-Kyriazi and all
directors and current executive officers as a group include 468 shares
allocated to Mr. Melas-Kyriazi's account maintained pursuant to the ESOP.
Shares beneficially owned by Mr. Jungers, Mr. McCabe and all directors and
current executive officers as a group include 13,563, 8,908 and 22,471
shares, respectively, allocated to their respective accounts maintained
pursuant to Thermo Instrument's deferred compensation plan for directors.
Shares beneficially owned by Mr. Lewis include 2,987 shares held by his
spouse. No director or current executive officer beneficially owned more
than 1% of the Thermo Instrument common stock outstanding as of January 31,
2000; all directors and current executive officers as a group beneficially
owned less than 1% of the Thermo Instrument common stock outstanding as of
January 31, 2000.
THERMO INSTRUMENT
We have set forth in the following table:
- the name, business address, position with Thermo Instrument, present
principal occupation or employment and five-year employment history of
each of the directors and executive officers of Thermo Instrument; and
- the names, principal businesses and addresses of any corporations or
other organizations in which those principal occupations are conducted.
Unless otherwise indicated, each occupation listed in the table refers to
Thermo Instrument, each individual is a United States citizen and each
individual's business address is 81 Wyman Street, Waltham, Massachusetts 02454.
Unless otherwise indicated, to our knowledge, no director or executive
officer of Thermo Instrument beneficially owns any shares of our common stock or
of Thermo Instrument common stock or rights to acquire shares of our common
stock or Thermo Instrument common stock. Unless otherwise indicated, to our
knowledge, no director or executive officer of Thermo Instrument has been
convicted in a criminal proceeding during the last five years, excluding traffic
violations or similar misdemeanors, and no director
A-5
<PAGE> 73
or executive officer of Thermo Instrument was a party to any judicial or
administrative proceeding during the last five years that resulted in a
judgement, decree or final order enjoining the person from future violations of,
or prohibiting activities subject to, federal or state securities laws, or a
finding of any violation of federal or state securities laws.
Arvin H. Smith, John N. Hatsopoulos and Richard F. Syron resigned from the
board of directors of Thermo Instrument effective February 15, 2000, February
21, 2000 and March 7, 2000, respectively. George N. Hatsopoulos retired from the
board of directors of Thermo Instrument effective March 31, 2000.
EARL R. LEWIS....................... Mr. Lewis, 56, has been a director and
the chief executive officer of Thermo
Instrument since January 1998, and has
been president of Thermo Instrument
since March 1997. He was chief
operating officer of Thermo Instrument
from January 1996 to January 1998.
Prior to that time, he was executive
vice president of Thermo Instrument
from January 1996 to March 1997 and
senior vice president from January 1994
to January 1996. Mr. Lewis has been the
chief operating officer, measurement
and detection, of Thermo Electron since
September 1998. Prior to his
appointment as chief operating officer,
Mr. Lewis served as senior vice
president of Thermo Electron from June
1998 to September 1998 and vice
president from September 1996 to June
1998. Mr. Lewis served as chief
executive officer of Thermo Optek
Corporation from its inception in
August 1995 to January 1998. Mr. Lewis
is a director of FLIR Systems Inc.,
SpectRx Inc. and Spectra-Physics
Lasers, Inc.
POLYVIOS C. VINTIADIS............... Mr. Vintiadis, 64, has been a director
of Thermo Instrument since July 1993.
Mr. Vintiadis has been the chairman and
chief executive officer of Towermarc
Corporation, a real estate development
company located at Two Sound View
Drive, Greenwich, CT 06830, since 1984.
Mr. Vintiadis is also a director of
Spectra-Physics Lasers, Inc. and Thermo
TerraTech Inc.
RICHARD W.K. CHAPMAN................ Dr. Chapman, 54, has been senior vice
president of Thermo Instrument since
July 1998 and was a vice president of
Thermo Instrument from 1992 until July
1998. He has been the chief executive
officer, president and a director of
ThermoQuest Corporation, a subsidiary
of Thermo Instrument since its
inception in June 1995. ThermoQuest
Corporation develops and distributes
mass spectrometers, liquid
chromatographs, gas chromatographs, and
multi-instrument combinations of these
products for the pharmaceutical,
environmental, and industrial
marketplaces and is located at 2215
Grand Avenue Parkway, Austin, TX
78728-3812.
A-6
<PAGE> 74
DENIS A. HELM....................... Mr. Helm, 61, has been executive vice
president of Thermo Instrument since
January 1999, and was a senior vice
president from 1994 to 1998. From 1981
to 1998, Mr. Helm served as president
of Thermo Instrument's Thermo
Environmental Instruments Inc.
subsidiary, a manufacturer of
instruments and systems for detecting
and monitoring environmental
pollutants. Mr. Helm also served as
chief executive officer of Metrika
Systems Corporation, a subsidiary of
Thermo Instrument that develops and
manufactures process optimization
systems for raw material analysis and
finished materials quality control,
from November 1996 until February 1998.
Mr. Helm's business address is 8 East
Forge Parkway, Franklin, MA 02038. Mr.
Helm is also a director of Metrika
Systems Corporation.
BARRY S. HOWE....................... Mr. Howe, 44, has been a vice president
of Thermo Instrument since 1994. He has
been president and chief executive
officer of ThermoSpectra Corporation, a
subsidiary of Thermo Instrument that
develops, manufactures, and markets
precision imaging, inspection,
measurement, and temperature-control
instrumentation, since March 1998 and
was appointed president, chief
executive officer and a director of
Thermo Optek Corporation, a subsidiary
of Thermo Instrument, in October 1999.
Thermo Optek is a manufacturer of
analytical instruments that measure
energy and light for purposes of
materials analysis, characterization
and preparation. Mr. Howe also served
as president and chief executive
officer of Thermo BioAnalysis
Corporation, which develops and markets
instruments, consumables, diagnostics
and information measurement systems for
biochemistry, healthcare and other
applications, from February 1995 to
March 1998. Mr. Howe's business address
is 8 East Forge Parkway, Franklin, MA
02038.
THEO MELAS-KYRIAZI.................. Mr. Melas-Kyriazi, 40, has been the
chief financial officer of Thermo
Instrument since January 1999. He has
been a vice president of Thermo
Electron since March 1998 and its chief
financial officer since January 1999.
Prior to his appointment as a vice
president at Thermo Electron, Mr.
Melas-Kyriazi served as president and
chief executive officer of
ThermoSpectra Corporation, a subsidiary
of Thermo Instrument that develops,
manufactures, and markets precision
imaging, inspection, measurement, and
temperature-control instrumentation,
from its inception until March 1998.
Mr. Melas-Kyriazi is a citizen of
Greece.
A-7
<PAGE> 75
Stock Ownership. The following table sets forth the beneficial ownership
of common stock of Thermo Instrument and Thermo Electron, as of January 31,
2000, with respect to each director and executive officer of Thermo Instrument.
While some directors and executive officers of Thermo Instrument are also
directors and executive officers of Thermo Electron or its subsidiaries, all
such persons disclaim beneficial ownership of the shares of common stock
beneficially owned by us.
<TABLE>
<CAPTION>
THERMO THERMO
INSTRUMENT ELECTRON
NAME(1) SYSTEMS INC.(2) CORPORATION(3)
------- ---------------- --------------
<S> <C> <C>
Richard W.K. Chapman........................................ 225,530 79,801
Denis A. Helm............................................... 278,638 167,163
Barry S. Howe............................................... 303,290 71,655
Earl R. Lewis............................................... 436,499 215,477
Theo Melas-Kyriazi.......................................... 182,715 458,532
Polyvios C. Vintiadis....................................... 17,597 2,500
All directors and current executive officers as a group (6
persons).................................................. 1,444,269 995,128
</TABLE>
---------------
(1) Except as reflected in the footnotes to this table, shares of the common
stock beneficially owned consist of shares owned by the indicated person or
by that person for the benefit of minor children, and all share ownership
includes sole voting and investment power.
(2) Shares of the Thermo Instrument common stock beneficially owned by Dr.
Chapman, Mr. Helm, Mr. Howe, Mr. Lewis, Mr. Melas-Kyriazi, Mr. Vintiadis and
all directors and current executive officers as a group include 196,249,
216,250, 273,156, 409,081, 163,687, 11,745 and 1,270,168 shares,
respectively, that such person or group had the right to acquire within 60
days of January 31, 2000, through the exercise of stock options. Shares
beneficially owned by Mr. Melas-Kyriazi and all directors and current
executive officers as a group include 468 shares, allocated through January
31, 2000, to Mr. Melas-Kyriazi's account maintained pursuant to Thermo
Electron's employee stock ownership plan (the "ESOP"). Shares beneficially
owned by Mr. Vintiadis and all directors and current executive officers as a
group include 5,590 shares, allocated through January 1, 2000, to Mr.
Vintiadis' account maintained under Thermo Instrument's deferred
compensation plan for directors. Shares beneficially owned by Mr. Helm
include a total of 5,264 shares held in custodial accounts for the benefit
of four minor children. Shares beneficially owned by Mr. Howe include 374
shares held in custodial accounts for the benefit of his minor children.
Shares beneficially owned by Mr. Lewis include 2,987 shares held by his
spouse. No director or current executive officer beneficially owned more
than 1% of the Thermo Instrument common stock outstanding as of January 31,
2000; all directors and current executive officers as a group beneficially
owned 1.1% of the Thermo Instrument common stock outstanding as of such
date.
(3) Shares of the common stock of Thermo Electron beneficially owned by Dr.
Chapman, Mr. Helm, Mr. Howe, Mr. Lewis, Mr. Melas-Kyriazi and all directors
and current executive officers as a group include 76,428, 99,816, 64,141,
212,278, 384,361 and 837,024 shares, respectively, that such person or group
had the right to acquire within 60 days of January 31, 2000, through the
exercise of stock options. Shares beneficially owned by Mr. Melas-Kyriazi
and all directors and current executive officers as a group include 1,071
shares, allocated through January 31, 2000, to Mr. Melas-Kyriazi's account
maintained pursuant to the ESOP. Shares beneficially owned by Mr. Helm
include 8,100 shares held in custodial accounts for the benefit of his minor
children. Shares beneficially owned by Mr. Howe include 200 shares held in
custodial accounts for the benefit of his minor children. No director or
current executive officer beneficially owned more than 1% of the Thermo
Electron common stock outstanding as of January 31, 2000; all directors and
current executive officers as a group beneficially owned less than 1% of the
Thermo Electron common stock outstanding as of such date.
A-8
<PAGE> 76
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<PAGE> 77
ANNEX B
INFORMATION CONCERNING TRANSACTIONS IN THE
COMMON STOCK OF THERMO INSTRUMENT
Neither we nor, to our knowledge, any of our directors or executive
officers engaged in any transactions in Thermo Instrument common stock during
the 60-day period ended June 26, 2000, except for the option exercises described
below.
<TABLE>
<CAPTION>
NUMBER OF
SHARES RECEIVED EXERCISE PRICE
NAME RELATIONSHIP EXERCISE DATE UPON EXERCISE PER SHARE
---- ------------------------- ------------- --------------- --------------
<S> <C> <C> <C> <C>
Elias P. Gyftopoulos................. Director, Thermo Electron 6/26/00 1,053 $11.44
Frank Jungers........................ Director, Thermo Electron 5/17/00 2,109 $ 7.11
Robert A. McCabe..................... Director, Thermo Electron 6/7/00 702 $11.44
William A. Rainville................. Director, Thermo 5/10/00 2,000 $10.88
Instrument; Chief
Operating Officer,
Recycling and Resource
Recovery, Thermo Electron
William A. Rainville................. See above 5/10/00 7,033 $ 7.11
</TABLE>
B-1
<PAGE> 78
[This page intentionally left blank]
<PAGE> 79
ANNEX C
SECTION 262 OF THE DELAWARE GENERAL CORPORATION LAW
(a) Any stockholder of a corporation of this State who holds shares of
stock on the date of the making of a demand pursuant to subsection (d) of this
section with respect to such shares, who continuously holds such shares through
the effective date of the merger or consolidation, who has otherwise complied
with subsection (d) of this section and who has neither voted in favor of the
merger or consolidation nor consented thereto in writing pursuant to sec.228 of
this title shall be entitled to an appraisal by the Court of Chancery of the
fair value of the stockholder's shares of stock under the circumstances
described in subsections (b) and (c) of this section. As used in this section,
the word "stockholder" means a holder of record of stock in a stock corporation
and also a member of record of a nonstock corporation; the words "stock" and
"share" mean and include what is ordinarily meant by those words and also
membership or membership interest of a member of a nonstock corporation; and the
words "depository receipt" mean a receipt or other instrument issued by a
depository representing an interest in one or more shares, or fractions thereof,
solely of stock of a corporation, which stock is deposited with the depository.
(b) Appraisal rights shall be available for the shares of any class or
series of stock of a constituent corporation in a merger or consolidation to be
effected pursuant to sec.251 (other than a merger effected pursuant to
sec.251(g)of this title), sec.252, sec.254, sec.257, sec.258, sec.263 or sec.264
of this title:
(1) Provided, however, that no appraisal rights under this section
shall be available for the shares of any class or series of stock, which
stock, or depository receipts in respect thereof, at the record date fixed
to determine the stockholders entitled to receive notice of and to vote at
the meeting of stockholders to act upon the agreement of merger or
consolidation, were either (i) listed on a national securities exchange or
designated as a national market system security on an interdealer quotation
system by the National Association of Securities Dealers, Inc. or (ii) held
of record by more than 2,000 holders; and further provided that no
appraisal rights shall be available for any shares of stock of the
constituent corporation surviving a merger if the merger did not require
for its approval the vote of the stockholders of the surviving corporation
as provided in subsection (f) of sec.251 of this title.
(2) Notwithstanding paragraph (1) of this subsection, appraisal rights
under this section shall be available for the shares of any class or series
of stock of a constituent corporation if the holders thereof are required
by the terms of an agreement of merger or consolidation pursuant to
sec.sec.251, 252, 254, 257, 258, 263 and 264 of this title to accept for
such stock anything except:
a. Shares of stock of the corporation surviving or resulting from
such merger or consolidation, or depository receipts in respect thereof;
b. Shares of stock of any other corporation, or depository receipts
in respect thereof, which shares of stock (or depository receipts in
respect thereof) or depository receipts at the effective date of the
merger or consolidation will be either listed on a national securities
exchange or designated as a national market system security on an
interdealer quotation system by the National Association of Securities
Dealers, Inc. or held of record by more than 2,000 holders;
c. Cash in lieu of fractional shares or fractional depository
receipts described in the foregoing subparagraphs a. and b. of this
paragraph; or
d. Any combination of the shares of stock, depository receipts and
cash in lieu of fractional shares or fractional depository receipts
described in the foregoing subparagraphs a., b. and c. of this
paragraph.
(3) In the event all of the stock of a subsidiary Delaware corporation
party to a merger effected under sec.253 of this title is not owned by the
parent corporation immediately prior to the merger, appraisal rights shall
be available for the shares of the subsidiary Delaware corporation.
C-1
<PAGE> 80
(c) Any corporation may provide in its certificate of incorporation that
appraisal rights under this section shall be available for the shares of any
class or series of its stock as a result of an amendment to its certificate of
incorporation, any merger or consolidation in which the corporation is a
constituent corporation or the sale of all or substantially all of the assets of
the corporation. If the certificate of incorporation contains such a provision,
the procedures of this section, including those set forth in subsections (d) and
(e) of this section, shall apply as nearly as is practicable.
(d) Appraisal rights shall be perfected as follows:
(1) If a proposed merger or consolidation for which appraisal rights
are provided under this section is to be submitted for approval at a
meeting of stockholders, the corporation, not less than 20 days prior to
the meeting, shall notify each of its stockholders who was such on the
record date for such meeting with respect to shares for which appraisal
rights are available pursuant to subsections (b) or (c) hereof that
appraisal rights are available for any or all of the shares of the
constituent corporations, and shall include in such notice a copy of this
section. Each stockholder electing to demand the appraisal of such
stockholder's shares shall deliver to the corporation, before the taking of
the vote on the merger or consolidation, a written demand for appraisal of
such stockholder's shares. Such demand will be sufficient if it reasonably
informs the corporation of the identity of the stockholder and that the
stockholder intends thereby to demand the appraisal of such stockholder's
shares. A proxy or vote against the merger or consolidation shall not
constitute such a demand. A stockholder electing to take such action must
do so by a separate written demand as herein provided. Within 10 days after
the effective date of such merger or consolidation, the surviving or
resulting corporation shall notify each stockholder of each constituent
corporation who has complied with this subsection and has not voted in
favor of or consented to the merger or consolidation of the date that the
merger or consolidation has become effective; or
(2) If the merger or consolidation was approved pursuant to sec.228 or
sec.253 of this title, each constituent corporation, either before the
effective date of the merger or consolidation or within ten days
thereafter, shall notify each of the holders of any class or series of
stock of such constituent corporation who are entitled to appraisal rights
of the approval of the merger or consolidation and that appraisal rights
are available for any or all shares of such class or series of stock of
such constituent corporation, and shall include in such notice a copy of
this section; provided that, if the notice is given on or after the
effective date of the merger or consolidation, such notice shall be given
by the surviving or resulting corporation to all such holders of any class
or series of stock of a constituent corporation that are entitled to
appraisal rights. Such notice may, and, if given on or after the effective
date of the merger or consolidation, shall, also notify such stockholders
of the effective date of the merger or consolidation. Any stockholder
entitled to appraisal rights may, within 20 days after the date of mailing
of such notice, demand in writing from the surviving or resulting
corporation the appraisal of such holder's shares. Such demand will be
sufficient if it reasonably informs the corporation of the identity of the
stockholder and that the stockholder intends thereby to demand the
appraisal of such holder's shares. If such notice did not notify
stockholders of the effective date of the merger or consolidation, either
(i) each such constituent corporation shall send a second notice before the
effective date of the merger or consolidation notifying each of the holders
of any class or series of stock of such constituent corporation that are
entitled to appraisal rights of the effective date of the merger or
consolidation or (ii) the surviving or resulting corporation shall send
such a second notice to all such holders on or within 10 days after such
effective date; provided, however, that if such second notice is sent more
than 20 days following the sending of the first notice, such second notice
need only be sent to each stockholder who is entitled to appraisal rights
and who has demanded appraisal of such holder's shares in accordance with
this subsection. An affidavit of the secretary or assistant secretary or of
the transfer agent of the corporation that is required to give either
notice that such notice has been given shall, in the absence of fraud, be
prima facie evidence of the facts stated therein. For purposes of
determining the stockholders entitled to receive either notice, each
constituent corporation may fix, in advance, a record date that shall be
not more than 10 days prior to the date the notice is given, provided, that
if the notice is given on or after the effective date of the
C-2
<PAGE> 81
merger or consolidation, the record date shall be such effective date. If
no record date is fixed and the notice is given prior to the effective
date, the record date shall be the close of business on the day next
preceding the day on which the notice is given.
(e) Within 120 days after the effective date of the merger or
consolidation, the surviving or resulting corporation or any stockholder who has
complied with subsections (a) and (d) hereof and who is otherwise entitled to
appraisal rights, may file a petition in the Court of Chancery demanding a
determination of the value of the stock of all such stockholders.
Notwithstanding the foregoing, at any time within 60 days after the effective
date of the merger or consolidation, any stockholder shall have the right to
withdraw such stockholder's demand for appraisal and to accept the terms offered
upon the merger or consolidation. Within 120 days after the effective date of
the merger or consolidation, any stockholder who has complied with the
requirements of subsections (a) and (d) hereof, upon written request, shall be
entitled to receive from the corporation surviving the merger or resulting from
the consolidation a statement setting forth the aggregate number of shares not
voted in favor of the merger or consolidation and with respect to which demands
for appraisal have been received and the aggregate number of holders of such
shares. Such written statement shall be mailed to the stockholder within 10 days
after such stockholder's written request for such a statement is received by the
surviving or resulting corporation or within 10 days after expiration of the
period for delivery of demands for appraisal under subsection (d) hereof,
whichever is later.
(f) Upon the filing of any such petition by a stockholder, service of a
copy thereof shall be made upon the surviving or resulting corporation, which
shall within 20 days after such service file in the office of the Register in
Chancery in which the petition was filed a duly verified list containing the
names and addresses of all stockholders who have demanded payment for their
shares and with whom agreements as to the value of their shares have not been
reached by the surviving or resulting corporation. If the petition shall be
filed, by the surviving or resulting corporation, the petition shall be
accompanied by such a duly verified list. The Register in Chancery, if so
ordered by the Court, shall give notice of the time and place fixed for the
hearing of such petition by registered or certified mail to the surviving or
resulting corporation and to the stockholders shown on the list at the addresses
therein stated. Such notice shall also be given by or more publications at least
week before the day of the hearing, in a newspaper of general circulation
published in the City of Wilmington, Delaware or such publication as the Court
deems advisable. The forms of the notices by mail and by publication shall be
approved by the Court, and the costs thereof shall be borne by the surviving or
resulting corporation.
(g) At the hearing on such petition, the Court shall determine the
stockholders who have complied with this section and who have become entitled to
appraisal rights. The Court may require the stockholders who have demanded an
appraisal for their shares and who hold stock represented by certificates to
submit their certificates of stock to the Register in Chancery for notation
thereon of the pendency of the appraisal proceedings; and if any stockholder
fails to comply with such direction, the Court may dismiss the proceedings as to
such stockholder.
(h) After determining the stockholders entitled to an appraisal, the Court
shall appraise the shares, determining their fair value exclusive of any element
of value arising from the accomplishment or expectation of the merger or
consolidation, together with a fair rate of interest, if any, to be paid upon
the amount determined to be the fair value. In determining such fair value, the
Court shall take into account all relevant factors. In determining the fair rate
of interest, the Court may consider all relevant factors, including the rate of
interest which the surviving or resulting corporation would have had to pay to
borrow money during the pendency of the proceeding. Upon application by the
surviving or resulting corporation or by any stockholder entitled to participate
in the appraisal proceeding, the Court may, in its discretion, permit discovery
or other pretrial proceedings and may proceed to trial upon the appraisal prior
to the final determination of the stockholder entitled to an appraisal. Any
stockholder whose name appears on the list filed by the surviving or resulting
corporation pursuant to subsection (f) of this section and who has submitted
such stockholder's certificates of stock to the Register in Chancery, if such is
required, may participate fully in all proceedings until it is finally
determined that such stockholder is not entitled to appraisal rights under this
section.
C-3
<PAGE> 82
(i) The Court shall direct the payment of the fair value of the shares,
together with interest, if any, by the surviving or resulting corporation to the
stockholders entitled thereto. Interest may be simple or compound, as the Court
may direct. Payment shall be so made to each such stockholder, in the case of
holders of uncertificated stock forthwith, and the case of holders of shares
represented by certificates upon the surrender to the corporation of the
certificates representing such stock. The Court's decree may be enforced as
other decrees in the Court of Chancery may be enforced, whether such surviving
or resulting corporation be a corporation of this State or of any state.
(j) The costs of the proceeding may be determined by the Court and taxed
upon the parties as the Court deems equitable in the circumstances. Upon
application of a stockholder, the Court may order all or a portion of the
expenses incurred by any stockholder in connection with the appraisal
proceeding, including, without limitation, reasonable attorney's fees and the
fees and expenses of experts, to be charged pro rata against the value of all
the shares entitled to an appraisal.
(k) From and after the effective date of the merger or consolidation, no
stockholder who has demanded appraisal rights as provided in subsection (d) of
this section shall be entitled to vote such stock for any purpose or to receive
payment of dividends or other distributions on the stock (except dividends or
other distributions payable to stockholders of record at a date which is prior
to the effective date of the merger or consolidation); provided, however, that
if no petition for an appraisal shall be filed within the time provided in
subsection (e) of this section, or if such stockholder shall deliver to the
surviving or resulting corporation a written withdrawal of such stockholder's
demand for an appraisal and an acceptance of the merger or consolidation, either
within 60 days after the effective date of the merger or consolidation as
provided in subsection (e) of this section or thereafter with the written
approval of the corporation, then the right of such stockholder to an appraisal
shall cease. Notwithstanding the foregoing, no appraisal proceeding in the Court
of Chancery shall be dismissed as to any stockholder without the approval of the
Court, and such approval may be conditioned upon such terms as the Court deems
just.
(l) The shares of the surviving or resulting corporation to which the
shares of such objecting stockholders would have been converted had they
assented to the merger or consolidation shall have the status of authorized and
unissued shares of the surviving or resulting corporation. (Last amended by Ch.
339, L. '98, eff. 7-1-98.)
C-4
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You or your broker, dealer, commercial bank, trust company or other nominee
should deliver your letter of transmittal, certificates for Thermo Instrument
shares and any other required documents to the depositary at one of its address
set forth below.
The Depositary for the exchange offer is:
AMERICAN STOCK TRANSFER & TRUST COMPANY
<TABLE>
<S> <C>
By Mail: By Hand or Overnight
40 Wall Street Courier:
46th Floor 40 Wall Street
New York, New York 10005 46th Floor
Attn: Reorganization New York, New York 10005
Department Attn: Reorganization
Department
</TABLE>
By Facsimile Transmission:
(718) 234-5001
Confirm by Telephone:
(718) 921-8200
You should direct any questions or requests for assistance or additional
copies of the prospectus, the letter of transmittal and the notice of guaranteed
delivery to the Information Agent at its telephone numbers and location listed
below. You may also contact your local broker, commercial bank, trust company or
nominee for assistance concerning the exchange offer.
The Information Agent for the exchange offer is:
D.F. KING & CO., INC.
77 Water Street, 20th Floor
New York, NY 10005
Bankers and Brokers Call Collect (212) 269-5550
All Others Call Toll-Free (800) 290-6433
<PAGE> 87
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Delaware General Corporation Law and Thermo Electron's Certificate of
Incorporation and Bylaws limit the monetary liability of directors to Thermo
Electron and to its stockholders and provide for indemnification of Thermo
Electron's officers and directors for liabilities and expenses that they may
incur in such capacities. In general, officers and directors are indemnified
with respect to actions taken in good faith in a manner reasonably believed to
be in, or not opposed to, the best interests of Thermo Electron and, with
respect to any criminal action or proceeding, actions that the indemnitee had no
reasonable cause to believe were unlawful. Thermo Electron also has
indemnification agreements with its directors and officers that provide for the
maximum indemnification allowed by law.
Thermo Electron has an insurance policy which insures its directors and
officers against those liabilities set forth in the insurance policy which might
be incurred in connection with the performance of their duties.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) The following exhibits are filed herewith or incorporated herein by
reference:
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
------- -----------------------
<C> <S>
3.1 Amended and Restated Certificate of Incorporation of the
Registrant (incorporated by reference to Exhibit 1 to the
Registrant's Amendment No. 3 to Registration Statement on
Form 8-A/A filed on September 9, 1999 (SEC File No.
1-8002)).
3.2 Bylaws of the Registrant (incorporated by reference to
Exhibit 3 to the Registrant's Quarterly Report on Form 10-Q
for the quarter ended July 3, 1999 (SEC File No. 1-8002)).
4.1 Reference is made to Exhibits 3.1 and 3.2 above.
4.2 Fiscal Agency Agreement dated as of January 3, 1996, between
the Registrant and Chemical Bank pertaining to the
Registrant's 4 1/4% Subordinated Convertible Debentures due
2003 (incorporated by reference to Exhibit 4.1 to
Registrant's Annual Report on Form 10-K for the fiscal year
ended December 30, 1995 (SEC File No. 1-8002)). The
Registrant agrees, pursuant to Item 601(b)(4)(iii)(A) of
Regulation S-K, to furnish to the Commission upon request, a
copy of each instrument with respect to other long-term debt
of the Registrant or its consolidated subsidiaries.
4.3 Rights Agreement, dated as of January 19, 1996, between the
Registrant and the First National Bank of Boston, as Rights
Agent, which includes as Exhibit A the Form of Certificate
of Designations, as Exhibit B the Form of Rights Certificate
and as Exhibit C the Summary of Rights to Purchase Preferred
Stock (incorporated by reference to Exhibit 1 to the
Registrant's Registration Statement on Form 8-A filed on
January 26, 1996, as amended by Amendment No. 1 to
Registration Statement on Form 8-A/A filed on May 30, 1997
(SEC File No. 1-8002)).
4.4 Amendment No. 1 to Rights Agreement, dated as of June 11,
1999, between the Registrant and BankBoston, N.A. (formerly,
The First National Bank of Boston), as Rights Agent, which
includes as Exhibit B the amended and restated Form of
Rights Certificate and as Exhibit C the amended and restated
Summary of Rights to Purchase Preferred Stock (incorporated
by reference to Exhibit 2 to the Registrant's Amendment No.
2 to Registration Statement on Form 8-A/A filed on June 21,
1999 (SEC File No. 1-8002)).
</TABLE>
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<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
------- -----------------------
<C> <S>
4.5 Indenture dated as of October 29, 1998, by and between the
Registrant and Bankers Trust Company, as Trustee, relating
to the issuance of senior debt securities by the Registrant
(incorporated by reference to Exhibit 4.1 to the
Registrant's Current Report on Form 8-K dated October 29,
1998, filed with the SEC on October 30, 1998 (SEC File No.
1-8002)).
4.6 First Supplemental Indenture dated as of October 29, 1998,
by and between the Registrant and Bankers Trust Company, as
Trustee, relating to the issuance by the Registrant of
$150,000,000 aggregate principal amount of its 7.625% Notes
due 2008 (incorporated by reference to Exhibit 4.2 to the
Registrant's Current Report on Form 8-K dated October 29,
1998, filed with the SEC on October 30, 1998 (SEC File No.
1-8002)).
5.1* Opinion and consent of Seth H. Hoogasian, Esq. as to the
validity of the securities being issued.
8.1* Opinion and consent of Hale and Dorr LLP as to the material
United States federal income tax consequences of the
exchange offer and the merger.
10.1 Form of Indemnification Agreement between the Registrant and
the directors and officers of its majority-owned
subsidiaries (filed as Exhibit 10.1 to the Registrant's
Registration Statement on Form S-4 [Reg. No. 333-90661] and
incorporated herein by reference).
10.2 Form of Amended and Restated Indemnification Agreement
between the Registrant and its directors and officers (filed
as Exhibit 10.2 to the Registrant's Registration Statement
on Form S-4 [Reg. No. 333-90661] and incorporated herein by
reference).
12.1* Computation of Registrant's ratio of earnings to fixed
charges.
12.2* Computation of Thermo Instrument's ratio of earnings to
fixed charges.
21.1 Subsidiaries of the Registrant (incorporated by reference to
Exhibit 21.1 to the Registrant's Annual Report on Form 10-K
dated January 1, 2000, filed with the SEC on March 22, 2000
(SEC File No. 1-8002)).
23.1 Consent of Arthur Andersen LLP, independent accountants to
the Registrant.
23.2 Consent of Arthur Andersen LLP, independent accountants to
Thermo Instrument Systems Inc.
23.3* Consent of Seth H. Hoogasian, Esq. (included in Exhibit 5.1
of this Registration Statement).
23.4* Consent of Hale and Dorr LLP (included in Exhibit 8.1 of
this Registration Statement).
24.1* Powers of Attorney (included in the signature pages of this
Registration Statement as originally filed).
99.1* Form of Letter of Transmittal.
99.2* Form of Notice of Guaranteed Delivery.
99.3* Form of Broker Dealer Letter.
99.4* Form of Letter to Clients.
99.5* Form of Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9.
</TABLE>
---------------
* Previously filed.
ITEM 22. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) that, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual report
pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act
of 1934 (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in this registration statement
shall be deemed to be a new registration statement relating to the
securities
II-2
<PAGE> 89
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof;
(2) that before any public reoffering of the securities registered
hereunder through use of a prospectus which is a part of this registration
statement, by any person or party who is deemed to be an underwriter within
the meaning of Rule 145(c), the issuer undertakes that such reoffering
prospectus will contain the information called for by the applicable
registration form with respect to reofferings by persons who may be deemed
underwriters, in addition to the information called for by the other items
of the applicable form;
(3) that every prospectus (i) that is filed pursuant to paragraph (2)
immediately preceding, or (ii) that purports to meet the requirements of
Section 10(a)(3) of the Act and is used in connection with an offering of
securities subject to Rule 415, will be filed as a part of an amendment to
the registration statement and will not be used until such amendment is
effective, and that, for purposes of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof;
(4) to respond to requests for information that is incorporated by
reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this
Form, within one business day of receipt of such request, and to send the
incorporated documents by first class mail or other equally prompt means,
including information contained in documents filed after the effective date
of this registration statement through the date of responding to such
request; and
(5) to supply by means of a post-effective amendment all information
concerning a transaction, and the company being acquired involved therein,
that was not the subject of and included in this registration statement
when it became effective.
Insofar as indemnification for liabilities under the Securities Act of 1933
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described in Item 20 above, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act and is therefore unenforceable. If a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer, or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
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<PAGE> 90
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
has duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Waltham, Commonwealth of
Massachusetts, on this twenty seventh day of June, 2000.
THERMO ELECTRON CORPORATION
By: /s/ RICHARD F. SYRON
------------------------------------
Richard F. Syron
President, Chief
Executive Officer and
Chairman of the Board
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ RICHARD F. SYRON President, Chief Executive June 27, 2000
--------------------------------------------------- Officer and Chairman of the
Richard F. Syron Board (Principal Executive
Officer)
/s/ THEO MELAS-KYRIAZI Vice President and Chief June 27, 2000
--------------------------------------------------- Financial Officer (Principal
Theo Melas-Kyriazi Financial Officer and
Principal Accounting Officer)
* Director June 27, 2000
---------------------------------------------------
Samuel W. Bodman
* Director June 27, 2000
---------------------------------------------------
Peter O. Crisp
* Director June 27, 2000
---------------------------------------------------
Elias P. Gyftopoulos
* Director June 27, 2000
---------------------------------------------------
Frank Jungers
Director
---------------------------------------------------
Jim P. Manzi
* Director June 27, 2000
---------------------------------------------------
Robert A. McCabe
* Director June 27, 2000
---------------------------------------------------
Hutham S. Olayan
</TABLE>
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<PAGE> 91
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
* Director June 27, 2000
---------------------------------------------------
Robert W. O'Leary
* By /s/ THEO MELAS-KYRIAZI
---------------------------------------------------
Theo Melas-Kyriazi
Attorney-in-fact
</TABLE>
II-5
