SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _________ FORM 10-K X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1998 OR __ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________ to _________________ Commission file number 1-7928 BIO-RAD LABORATORIES, INC. (Exact Name of Registrant as Specified in Its Charter) Delaware 94-1381833 (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification No.) 1000 Alfred Nobel Drive, Hercules, CA 94547 (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code (510) 724-7000 Securities registered pursuant to Section 12(b) of the Act: Market Value on Name of Each Exchange Shares Outstanding March 1, 1999 of Stocks Title of Each Class on Which Registered March 1, 1999 Held by Non-Affiliates ------------------- --------------------- ------------------ ------------------------ Class A Common Stock Par Value $1.00 per share American Stock Exchange 9,977,862 $242,363,239 Class B Common Stock Par Value $1.00 per share American Stock Exchange 2,500,266 $ 10,215,330 Securities registered pursuant to Section 12(g) of the Act: NONE Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No _____ Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ] Documents Incorporated by Reference Document Form 10-K Parts _________________________________________ ____________________ (1) Annual Report to Stockholders for the fiscal year ended December 31, 1999 (specified portions) I, II, IV (2) Definitive Proxy Statement to be mailed to stockholders in connection with the registrant's 2000 Annual Meeting of Stockholders (specified portions) III P A R T I ITEM 1. BUSINESS General Founded in 1957, Bio-Rad Laboratories, Inc. ("Bio-Rad" or the "Company") was initially engaged in the development and production of specialty chemicals used in biochemical, pharmaceutical and other life science research applications. In 1967, the Company entered the field of clinical diagnostics with the development of its first test kit based on separation techniques and materials developed for life science research. Recognizing that the fields of clinical diagnostics and life science research were evolving toward more automated techniques, Bio-Rad expanded into the field of analytical and measuring instrument systems through internal research and development efforts and acquisitions in the late 1970's and 1980's. As Bio-Rad broadened its product lines, it also expanded its geographical market. The Company controls its distribution channels in thirty countries outside the U.S.A. through subsidiaries whose primary focus is customer service and product distribution. During 1996 and 1997, the Company made five acquisitions. The assets acquired from Chiron Diagnostics Corporation and Chiron Corporation on December 5, 1997, enhanced the product line offering for diagnostic controls. The remaining acquisitions broadened product line offerings within the Analytical Instruments and Life Science segments. On October 1, 1999 Bio-Rad acquired the stock of Pasteur Sanofi Diagnostics ("PSD") and the rights to certain ancillary assets for $210 million. PSD was founded by the Institut Pasteur to commercialize its diagnostic research, and holds certain exclusive licenses from the Institut Pasteur in the HIV and infectious disease diagnostic product market. PSD also expanded the geographic reach and market penetration for the Company's product particularly in Latin America, Africa and France. Bio-Rad manufactures and supplies the life science research, healthcare, analytical chemistry, semiconductor and other markets with a broad range of products and systems used to separate complex chemical and biological materials and to identify, analyze and purify their components. Description of Business Business Segments The Company operates in three industry segments designated Life Science, Clinical Diagnostics and Analytical Instruments. Each operates in both the U.S. and international markets. For a description of business and financial information on industry and geographic segments, see Note 13 on pages 19 through 22 of Exhibit 13.1, which is incorporated herein by reference. 1 Life Science Segment. Life science is the study of the characteristics, behavior, and structure of living organisms and their component systems. Life science researchers use a variety of products and systems-- including reagents, instruments, software and apparatus-- to advance the study of life processes, drug discovery and biotechnology, primarily within a laboratory setting. We focus on selected segments of the life science market-- laboratory devices, biomaterials, imaging products and microscopy systems-- for which we estimate 1999 worldwide sales totaled approximately $1.6 billion. The primary technological applications that we supply to these segments are diverse and consist of electrophoresis, image analysis and microplate readers, chromatography, gene transfer and sample preparation and amplification. The primary end-users in our sectors of the market are universities and medical schools, industrial research organizations, government agencies, pharmaceutical manufacturers and biotechnology researchers. Clinical Diagnostics Segment. The clinical diagnostics industry encompasses a broad array of technologies incorporated into a variety of tests used to detect, identify and quantify substances in blood or other bodily fluids and tissues. The test results are used as aids for medical diagnosis, detection, evaluation, monitoring and treatment of diseases and other medical conditions. The bulk of tests are performed in vitro (literally, "in glass"), while the remainder consists of in vivo ("in the body") tests. The most common type of in vitro tests are routine chemistry tests that measure important health parameters, such as glucose, cholesterol or sodium, as part of routine blood checks. A second type of diagnostic tests, on which we focus, are more specialized and require more sophisticated equipment and materials than do routine tests. These specialized tests are also lower-volume and higher-priced than routine tests. We estimate that in 1999, sales to the global clinical diagnostics industry totaled approximately $20 billion. The primary end-users in the areas of the clinical diagnostics industry we target are hospital laboratories, reference laboratories, physician office laboratories, government agencies and other diagnostics manufacturers. Analytical Instruments Segment. The analytical instruments segment develops, manufacturers, sells and services FT-IR spectroscopy systems, semiconductor tests and manufacturing instruments, spectral reference publications and software. Spectrometers measure the infrared spectra of materials, providing quantitative and qualitative information about their chemical composition. The primary end-users for spectrometers are scientists and researchers in a wide range of industries, 2 including chemicals, pharmaceuticals, biotechnology and food. Applications for the products are varied but range from general analytical purposes to research and development and quality control. Our semiconductor division designs, manufactures, and sells instruments and systems that measure the critical dimensions of integrated circuits ("ICs") and the characterization of silicon wafers and compound semiconductor materials. The primary end- users for these instruments and systems include IC, silicon substrate and compound semiconductor manufacturers, as well as universities and research institutes. The primary end-users for spectral databases, chemists and spectroscopists, use them to identify a sample through the spectrum it produces against a spectra of known compounds. A variety of market segments use these products, including the chemical, pharmaceutical, biotechnology, forensic and environmental chemistry industries, as well as academic researchers. Raw Materials and Components The Company utilizes a wide variety of chemicals, biological materials, electronic components, machined metal parts, optical parts, minicomputers and peripheral devices. Most of these materials and components are available from numerous sources and the Company has not experienced difficulty in securing adequate supplies. Patents and Trademarks We own numerous U.S. and international patents and patent licenses. We believe, however, that our ability to develop and manufacture our products depends primarily on our knowledge, technology and special skills. Under several patent license agreements, we pay royalties on the sales of certain products. We view these patents and license agreements as valuable assets. The clinical diagnostics segment has a broad portfolio of intellectual property which it uses to advance and promote its competitive position within the market of blood viruses, bacteriology, immuno-hematology, infectious diseases and cardiovascular testing. Its portfolio is comprised of owned patents, patent rights licensed from Institut Pasteur and other rights secured under third-party licensing agreements. Additionally, this segment has a wide array of patents and patent applications which are owned and licensed in the area of HIV testing. These include patents on purified virus proteins, antigens used for detection of HIV, monoclonal antibodies, cloned DNA sequences, primers and probes. Seasonal Operations and Backlog The Company's business is not inherently seasonal, however, the European custom of concentrating vacation during the summer 3 months usually has had a negative impact on third quarter sales volume and operating income. For the most part, the Company operates in markets characterized by short lead times and the absence of significant backlogs. The Company produces several analytical instruments against an order backlog. Management has concluded that backlog information is not material to the Company's business as a whole. Sales and Marketing Each of Bio-Rad's segments maintains a sales force to sell its products on a direct basis. Each sales force is technically trained in the disciplines associated with its products. Sales are also generated through direct mail advertising, exhibits at trade shows and technical meetings, telemarketing, and by extensive advertising in technical and trade publications. Sales and marketing efforts are augmented by technical service departments that assist customers in effective product utilization and in new product applications. Bio-Rad also produces and distributes technical literature and holds seminars for customers on the use of its products. Our customer base is broad and diversified. In 1999, no single customer accounted for more than 2% of our total net sales. Our sales are affected by certain external factors. For example, a number of our customers, particularly in the life science segment, are substantially dependent on government grants and research contracts for their funding, and a portion of the analytical instruments segment depends on contracts with large semiconductor manufacturers. Thus, the loss of government funding or a large contract or a severe downturn in the semiconductor market would have a detrimental effect on the results of these segments. Most of the Company's international sales are generated by wholly-owned subsidiaries and their branch offices in Australia, Austria, Belgium, Canada, Denmark, England, Finland, France, Germany, Hong Kong, Hungary, India, Israel, Italy, Japan, Korea, Mexico, the Netherlands, New Zealand, Norway, People's Republic of China, Poland, Portugal, Russia, Singapore, South Africa, Spain, Sweden, Switzerland and Thailand. Certain of these subsidiaries also have manufacturing facilities. While Bio-Rad's international operations are subject to certain risks common to foreign operations in general, such as changes in governmental regulations, import restrictions and foreign exchange fluctuations, the Company's international operations are principally in developed nations, which the Company regards as presenting no significantly greater risks to its operations than are present in the United States. Competition Most markets served by our product groups are competitive. Our competitors range in size from start-ups to large multinational corporations. Reliable independent information on sales and market share of products produced by our competitors is not 4 generally available. We believe, however, based on our on marketing information, that while some competitors are dominant with respect to certain individual products, no one company, including us, is dominant with respect to a material portion of any segment of our business. Life Science Segment. Because of the breadth of its product lines, Life Science does not face the same competitor for all of its products. Competitors in this market include Amersham Pharmacia Biotech, Life Technologies, Qiagen, Zeiss and PE Applied Biosystems. We compete primarily on meeting performance specifications. Clinical Diagnostics Segment. Competitors in this segment range in size from small private companies to large multinational corporations. We compete only in very specific market niches and do not attempt to pursue the most competitive general diagnostics markets. We compete based on our technological ability to provide customers with very specific tests and believe we are usually a significant competitor within our market niche. Competitors include Abbott Laboratories, bioMerieux, Inc., Roche Diagnostics, BioChem Pharma, Inova, diaSorin and Medical Analysis Systems. Analytical Instruments Segment. We compete in the high-end analytical instruments market primarily on the basis of technology and features. Competitors in this segment include Nicolet Instruments (a division of Thermo Instruments) and EG&G (formerly Perkin-Elmer) in spectroscopy; and Hitachi and KLA- Tencor in semiconductor measurement instruments. Product Research and Development The Company conducts extensive product research and development activities in all areas of our business, employing approximately 475 people worldwide in these activities. Research and development have played a major role in Bio-Rad's growth and are expected to continue to do so in the future. Our research teams are continuously developing new products and new applications for existing products. In our development and testing of new products and applications, we consult with scientific and medical professionals at universities, hospitals and medical schools, and in industry, most notably with the Institut Pasteur. We spent approximately $51.2 million (excluding $15.5 million of purchased in-process research and development expense), $41.4 million and $46.4 million on research and development activities during the years ended December 31, 1999, 1998 and 1997, respectively. Regulatory Matters The manufacturing, marketing and labeling of certain of our products (primarily diagnostic products) are subject to regulation in the United States by the Center for Devices and Radiological Health of the United States Food and Drug Administration ("FDA") and in other jurisdictions by state and foreign government authorities. FDA regulations require that some new products have pre-marketing approval by the FDA and 5 require certain products to be manufactured in accordance with "good manufacturing practices," to be extensively tested and to be properly labeled to disclose test results and performance claims and limitations. As a multinational manufacturer and distributor of sophisticated instrumentation equipment, we must meet a wide array of electromagnetic compatibility and safety compliance requirements to satisfy regulations in the United States, the European Community and other jurisdictions. The FDA must approve an export permit application before companies can market products outside the U.S. prior to the products' receipts of FDA approval. The requirements relating to testing and trials, product licensing, pricing and reimbursement vary widely among countries. Our operations are subject to federal, state, local and foreign environmental laws and regulations that govern such activities as emissions to air and discharges to water, as well as handling and disposal practices for solid, hazardous and medical wastes. In addition to environmental laws that regulate our operations, we are also subject to environmental laws and regulations that create liabilities and clean-up responsibility for spills, disposals or other releases of hazardous substances into the environment as a result of our operations or otherwise impacting real property that we own or operate. The environmental laws and regulations also subject us to claims by third parties for damages resulting from any spills, disposals or releases resulting from our operations or at any of our properties. Employees At December 31, 1999, Bio-Rad had approximately 4,100 full-time employees. Fewer than 7% of Bio-Rad's 1,900 U. S. employees are covered by a collective bargaining agreement which will expire on November 7, 2002. Many of Bio-Rad's non-U.S. full-time employees, especially in France, are covered by collective bargaining agreements. The Company is currently working with the representative unions of these employees to achieve workforce reductions where duplication or redundancies exist as a result of the PSD acquisition. Bio-Rad considers its employee relations in general to be good. ITEM 2. PROPERTIES We own our Corporate headquarters located in Hercules, California. The principal manufacturing and research locations for each segment are as follows: Approximate Segment Location Square Ftg. Owned/Leased Life Science Richmond, California 191,000 Owned/Leased Hercules, California 95,400 Owned Hemel Hempstead, England 102,000 Leased Milan, Italy 50,000 Leased 6 Clinical Diagnostics Hercules, California 112,000 Owned/Leased Irvine, California 137,000 Leased Greater Seattle, Washington 127,600 Owned/Leased Lille, France 182,000 Owned Paris, France 162,000 Leased Munich, Germany 55,000 Leased Nazareth-Eke, Belgium 30,000 Leased Analytical Instruments Cambridge, Massachusetts 76,000 Owned York, England 144,000 Owned Philadelphia, Pennsylvania 28,000 Owned Most manufacturing and research facilities also house administration, sales and distribution activities. In addition, we lease office and warehouse facilities in a variety of locations around the world. The facilities are used principally for sales, service, distribution and administration for all three segments. The Life Science segment's Richmond, California distribution and instrument manufacturing facility lease expires in November 2000. While we are currently negotiating a renewal, the lease is not automatically renewable. The Marnes la Coquette facility near Paris, France which served as the corporate headquarters for PSD, as well as a significant manufacturing and research facility is currently being renegotiated as the lease expired December 31, 1999. In the interim, the space is being occupied on a month to month basis. We believe all of our other facilities are adequate to support our current and anticipated production requirements. Historically, adequate space to expand sales and distribution channels has been available and we have leased space as needed. We have received several offers to purchase our facility located in Cambridge, Massachusetts. This facility houses a portion of the manufacturing and distribution for the analytical instruments segment, which we will relocate if the building is sold. ITEM 3. LEGAL PROCEEDINGS Note 12, "Legal Proceedings," appearing on page 19 of Exhibit 13.1 is incorporated herein by reference. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS There were no matters submitted to a vote of the Company's security holders during the fourth quarter of the fiscal year covered by this report. 7 P A R T II ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS Note 16, "Information Concerning Common Stock," appearing on page 23 of Exhibit 13.1 is incorporated herein by reference. The Company subsequent to year-end, effective February 17, 2000 has sold $150 million of 11-5/8% Senior Subordinated Notes ("Notes") due February 15, 2007. The initial purchasers for the Notes were Warburg Dillon Read LLC and ABN Amro Incorporated. The offering price was 98.832% and the initial purchaser's discount was 3%. Proceeds before expenses were $143.8 million and were used to repay the $100 million Senior Subordinated Credit Agreement, retire $20 million of the $100 million term loan and with substantially all of the residual proceeds, reduce the amount outstanding under the revolving facility. The obligations under the notes are not secured, rank junior to all of our existing and future senior debt, rank equally with all of our existing and future senior subordinated debt and rank senior to all our existing and future subordinated indebtedness. Our current and future domestic subsidiaries that are material to our business guarantee the notes, but our foreign subsidiaries do not. The Notes have not been registered under the Securities Act. Accordingly the initial purchasers will offer the Notes only to "Qualified Institutional Buyers" as defined under Rule 144A of the Securities Act and non-U.S. persons outside the United States in reliance upon Regulation S of the Securities Act. ITEM 6. SELECTED FINANCIAL DATA The table headed "Summary of Operations" appearing on page 1 of Exhibit 13.1 is incorporated herein by reference. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The section headed "Management's Discussion and Analysis of Results of Operations and Financial Condition" appearing on pages 25 through 33 of Exhibit 13.1 is incorporated herein by reference. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The section headed "Financial Risk Management" appearing on page 32 of Exhibit 13.1 is incorporated herein by reference. 8 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The Consolidated Financial Statements and Notes thereto and the Report of Independent Public Accountants appearing on pages 1 through 33 of Exhibit 13.1 are incorporated herein by reference. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. P A R T III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT The sections labeled "Election of Directors" and "Section 16(a) Beneficial Ownership Reporting Compliance" of the definitive Proxy Statement mailed to stockholders in connection with the 2000 Annual Meeting of Stockholders ("the 2000 Proxy Statement") are incorporated herein by reference. ITEM 11. EXECUTIVE COMPENSATION The sections labeled "Executive Compensation and Other Information," "Compensation of Directors," "Compensation Committee Interlocks and Insider Participation," "Report of the Compensation Committee of the Board of Directors" and "Stock Performance Graph" of the 2000 Proxy Statement are incorporated herein by reference. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The section labeled "Principal and Management Stockholders" of the 2000 Proxy Statement is incorporated herein by reference. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS The section labeled "Compensation of Directors" of the 2000 Proxy Statement is incorporated herein by reference. 9 P A R T IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K (a) 1. Index to Financial Statements The following Consolidated Financial Statements are included in the 1999 Annual Report and are incorporated herein by reference pursuant to Item 8: Page in Exhibit 13.1 Consolidated Balance Sheets at December 31, 1999 and 1998 2-3 Consolidated Statements of Income for each of the three years in the period ended December 31, 1999 4 Consolidated Statements of Cash Flows for each of the three years in the period ended December 31, 1999 5 Consolidated Statements of Changes in Stockholders' Equity for each of the three years in the period ended December 31, 1999 6 Notes to Consolidated Financial Statements 7-23 Report of Independent Public Accountants 24 2. Index to Financial Statement Schedule Page in Form 10-K Schedule II Valuation and Qualifying Accounts 12 Report of Independent Public Accountants on Schedule II 13 All other financial statement schedules are omitted because they are not required or because the required information is included in the Consolidated Financial Statements or the Notes thereto. 3. Index to Exhibits The exhibits listed in the accompanying Index to Exhibits on pages 15 and 16 of this report are filed or incorporated by reference as part of this report. 10 (b) Reports on Form 8-K Bio-Rad filed Form 8-K dated October 1, 1999, announcing that Bio-Rad completed the acquisition of 100% of the capital stock of Pasteur Sanofi Diagnostics from Sanofi-Synthelabo S.A. and Institut Pasteur pursuant to the terms of the Purchase Agreement (previously filed as Exhibit 2.1 to Form 8-K dated July 15, 1999). 11 BIO-RAD LABORATORIES, INC,. SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS Years Ended December 31, 1999, 1998 and 1997 (In thousands) Reserve for doubtful accounts receivable Additions Balance at Charged to Balance Beginning Costs and at End of Year Expenses Deductions Other of Year 1999 . . . $3,629 $3,123 $(2,449) $5,279(A) $9,582 1998 . . . $3,374 $1,616 $(1,361) $ - $3,629 1997 . . . $3,688 $1,088 $(1,402) $ - $3,374 Valuation allowance for deferred tax assets Deductions Balance at Charged to Balance Beginning Costs and at End of Year Additions Expenses Other of Year 1999 . . . . $5,342 $ -- $ (553) $19,342(A) $24,131 1998 . . . . $3,285 $2,057 $ -- $ -- $5,342 1997 . . . . $5,572 $ -- $(2,287) $ -- $3,285 (A) Valuation arising from the acquisition of PSD. 12 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ON SCHEDULE II To Bio-Rad Laboratories, Inc. We have audited in accordance with generally accepted auditing standards, the consolidated financial statements included in Bio-Rad Laboratories, Inc.'s annual report to stockholders incorporated by reference in this Form 10-K, and have issued our report thereon dated February 9, 2000. Our audit was made for the purpose of forming an opinion on those statements taken as a whole. The schedule listed in the index, Item 14(a)2, is the responsibility of the Company's management and is presented for purposes of complying with the Securities and Exchange Commission's rules and is not part of the basic financial statements. This schedule has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, fairly states in all material respects the financial data required to be set forth therein in relation to the basic financial statements taken as a whole. /s/ Arthur Andersen LLP ARTHUR ANDERSEN LLP San Francisco, California February 9, 2000 13 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. BIO-RAD LABORATORIES, INC. By: /s/ Sanford S. Wadler Sanford S. Wadler Secretary Date: March 28, 2000 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Principal Executive Officer: /s/ David Schwartz President and Director March 28, 2000 (David Schwartz) Principal Financial Officer: /s/ T. C. Chesterman Vice President, March 28, 2000 (Thomas C. Chesterman) Chief Financial Officer Principal Accounting Officer: /s/ James R. Stark Corporate Controller March 28, 2000 (James R. Stark) Other Directors: /s/ James J. Bennett Director March 28, 2000 (James J. Bennett) /s/ Albert J. Hillman Director March 28, 2000 (Albert J. Hillman) /s/ Philip L. Padou Director March 28, 2000 (Philip L. Padou) /s/ Alice N. Schwartz Director March 28, 2000 (Alice N. Schwartz) /s/ Norman Schwartz Director March 28, 2000 (Norman Schwartz) /s/ Burton A. Zabin Director March 28, 2000 (Burton A. Zabin) 14 BIO-RAD LABORATORIES, INC. INDEX TO EXHIBITS ITEM 14(a)3 The following documents are filed as part of this report: Exhibit No. 3.1 Restated Certificate of Incorporation, as of September 15, 1988. (1) 3.2 Bylaws of the Registrant, as amended February 19, 1980. (2) 4.1 Credit Agreement dated as of September 30, 1999 among Bio-Rad Laboratories, Inc., the lenders named therein, Bank One, N.A., as Administrative Agent, ABN Amro Bank N.V. as Syndication Agent and Union Bank of California, N.A. as Documentation Agent. (3) 4.1.1 Amendment dated as of January 31, 2000, to the Credit Agreement dated as of September 30, 1999, by and among Bio-Rad Laboratories, Inc. the lenders named therein, and Bank One, N.A. as Agent. 4.2 Senior Subordinated Credit Agreement dated as of September 30, 1999 among Bio-Rad Laboratories, Inc., the lenders named therein and Bank One Capital Markets, Inc., as agent. (3) 4.4 Senior Subordinated Credit Agreement dated as of January 31, 2000 among Bio-Rad Laboratories, Inc., the lenders names therein and UBS AG, Stamford Branch, as Agent. 4.5 The Indenture dated as of February 17, 2000 for 11.625% Senior Subordinated Notes due 2007 among Bio-Rad Laboratories, Inc., as Issuer, and Norwest Bank Minnesota, N.A., as Trustee. 4.6 The Registration Rights Agreement dated as of February 17, 2000 by and among Bio-Rad Laboratories, Inc. and Warburg Dillon Reed LLC and ABN AMRO Incorporated. 10.4 1994 Stock Option Plan. (4) 10.5 Amended and Restated 1988 Employee Stock Purchase Plan. (5) 10.6 Employees' Deferred Profit Sharing Retirement Plan (Amended and Restated effective January 1, 1997). (6) 10.10 Non-competition and employment continuation agreement with James J. Bennett. (7) 10.11 Employment and non-compete agreement with Dr. Burton A. Zabin. (8) 15 10.12 Split Dollar Life Insurance Agreement dated September 17, 1999 between the Schwartz Irrevocable Descendants Trust and Bio-Rad Laboratories, Inc. 13.1 Excerpt from Annual Report to Stockholders' for the fiscal year ended December 31, 1999, (to be deemed filed only to the extent required by the instructions to exhibits for reports on Form 10-K). 21.1 Listing of Subsidiaries. 23.1 Consent of Independent Public Accountants. 27.1 Financial Data Schedule. ________________________________________________________________ (1) Incorporated by reference from the Exhibits to the Company's Form 10-K filing for the fiscal year ended December 31, 1992, dated March 26, 1993. (2) Incorporated by reference from the Exhibits to the Company's Registration Statement on Form S-7 Registration No. 2-66797, which became effective April 22, 1980. (3) Incorporated by reference from Exhibits to the Company's Form 8-K dated October 1, 1999. (4) Incorporated by reference from the Exhibits to the Company's Form S-8 filing, dated April 28, 1994. (5) Incorporated by reference from the Exhibits to the Company's September 30, 1998, Form 10-Q filing dated November 10, 1998. (6) Incorporated by reference from the Exhibits to the Company's September 30, 1997, Form 10-Q filing dated November 13, 1997. (7) Incorporated by reference from the Exhibits to the Company's Form 10-K filing for the fiscal year ended December 31, 1996, dated March 26, 1997. (8) Incorporated by reference from the Exhibits to the Company's June 30, 1998, Form 10-Q filing dated August 6, 1998. 16 </TEXT> </DOCUMENT> <DOCUMENT> <TYPE>EX-4.1.1 <SEQUENCE>2 <DESCRIPTION>EXHIBIT 14.1.1 - AMENDMENT TO CREDIT AGREEMENT <TEXT> Exhibit 4.1.1 EXECUTION COPY AMENDMENT NO. 1 TO CREDIT AGREEMENT This Amendment No. 1 (this "Amendment") is entered into as of January 31, 2000 by and among BIO-RAD LABORATORIES, INC., a Delaware corporation (the "Borrower"), the undersigned lenders (collectively, the "Lenders") and BANK ONE, NA, having its principal office in Chicago, Illinois, as one of the Lenders and in its capacity as contractual representative (the "Agent") on behalf of itself and the other Lenders. RECITALS: WHEREAS, the Borrower, the Lenders and the Agent have entered into that certain Credit Agreement dated as of September 30, 1999 (the "Credit Agreement"); WHEREAS, the Borrower seeks to amend the Credit Agreement to permit the refinancing of the Bridge Loan (as defined in the Credit Agreement); and WHEREAS, the Lenders and the Agent are willing to amend the Credit Agreement on the terms and conditions herein set forth; NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: 1. Defined Terms. Capitalized terms used herein and not otherwise defined herein shall have the meanings attributed to such terms in the Credit Agreement. 2. Amendments to Credit Agreement. Upon the effectiveness of this Amendment in accordance with the provisions of Section 4 below, the Credit Agreement is hereby amended as follows: (a) Article I of the Credit Agreement is amended by adding thereto the following new definitions: "New Bridge Loan" means the bridge loan in the initial principal amount of $100,000,000 made to the Borrower on or about January 31, 2000 pursuant to the New Bridge Loan Agreement to refinance the Bridge Loan in its entirety, including any increase in such principal amount as a result of the capitalization of interest thereon and including any Rollover Bridge Notes and Exchange Notes, as defined in the New Bridge Loan Agreement; provided that the Exchange Notes shall be issued pursuant to an indenture all of the terms and conditions of which are reasonably acceptable to the Agent and the Required Lenders, and provided further that terms and conditions substantially similar to those contained in the Description of Notes shall be deemed to be reasonably acceptable. "New Bridge Loan Agreement" means the Senior Subordinated Credit Agreement dated as of January 31, 2000 among the Borrower, the lenders named therein and UBS AG, Stamford Branch, as agent for such lenders, together with any notes issued pursuant thereto. (b) Article I of the Credit Agreement is further amended by amending and restating in their entirety the following definitions as follows: "Consolidated EBITDA" means, with reference to any period, Consolidated Net Income for such period plus, to the extent deducted from revenues in determining Consolidated Net Income (without duplication), (i) Consolidated Interest Expense and all non-cash interest expense, (ii) expense for income taxes paid or accrued, (iii) depreciation, (iv) amortization, (v) extraordinary losses incurred other than in the ordinary course of business and losses from discontinued operations, (vi) any extraordinary, unusual or non-recurring non-cash expenses or non-cash losses, and (vii) non-recurring cash charges, including any capitalized non-recurring cash charges, taken on or prior to March 31, 2000 resulting from severance, integration and other adjustments made as a result of the PSD Acquisition (provided that the amounts referred to in this clause (vii) shall not, in the aggregate, exceed $25,000,000), and minus, to the extent included in Consolidated Net Income, extraordinary gains and gains from discontinued operations, all net of tax, realized other than in the ordinary course of business, all calculated for the Borrower and its Subsidiaries on a consolidated basis for such period; provided that the items to be added to and subtracted from Consolidated Net Income with respect to any Subsidiary shall be added or subtracted only to the extent and in the same proportions that (a) the net income of such Subsidiary was included in the calculation of Consolidated Net Income, if such Subsidiary is not a Wholly-Owned Subsidiary and (b) the Consolidated EBITDA of such Subsidiary (calculated as if such Subsidiary were the "Borrower") is permitted to be paid or distributed as a dividend, advance, loan or other distribution to the Borrower. "Consolidated Net Income" means, with reference to any period, the net income (or loss) of the Borrower and its Subsidiaries calculated on a consolidated basis for such period, provided that Consolidated Net Income shall exclude the net income, if positive, of any of the Borrower's consolidated Subsidiaries to the extent that the declaration or payment of dividends of similar distributions is not at the time permitted by operation of the terms of its charter or by-laws or any other agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to such Subsidiary. "Description of Notes" means the Description of Notes attached hereto as Exhibit D, provided that the amount "$155 million" in clause (3) of the description of "Limitation on Incurrence of Additional Indebtedness and Disqualified Capital Stock" in such Description of Notes shall be deleted and the amount "$180 million" substituted therefor. "Financing" means, with respect to any Person, the issuance or sale by such Person of any Equity Interests of such Person or any Indebtedness consisting of debt securities of such Person pursuant to a registered offering or private placement, but excluding the issuance or sale of (i) any Indebtedness permitted to be incurred pursuant to Section 6.11, including, without limitation, the Subordinated Indebtedness, except that the first $20,000,000 of Permitted Subordinated Indebtedness incurred in excess of the amount required to refinance the New Bridge Loan shall be deemed to be a Financing, (ii) Equity Interests by the Borrower to the extent that the proceeds thereof are used to refinance the New Bridge Loan in its entirety, (iii) Equity Interests by the Borrower to any officer, director or employee of the Borrower or any of its Subsidiaries pursuant to any incentive compensation plan or program and (iv) Equity Interests or Indebtedness by any Subsidiary of the Borrower to the Borrower or any Wholly-Owned Subsidiary of the Borrower. "Permitted Subordinated Indebtedness" means Indebtedness of the Borrower, the payment of which is subordinated to payment of the Secured Obligations and all of the terms and conditions of which are reasonably acceptable to the Agent and the Required Lenders, issued in an aggregate principal amount not to exceed $150,000,000, the proceeds of which are used, in whole or in part, to refinance the New Bridge Loan in its entirety; provided that terms and conditions substantially similar to those contained in the Description of Notes shall be deemed to be reasonably acceptable. "Subordinated Indebtedness" means the Bridge Loan, the New Bridge Loan and the Permitted Subordinated Indebtedness. (c) Section 6.1 of the Credit Agreement is amended by deleting the figure "100" in Section 6.1(i) and substituting the figure "90" therefor, by deleting the figure "60" in Section 6.1(ii) and substituting the figure "45" therefor, and by deleting the phrase "Together with the financial statements required under Sections 6.1(i) and (ii)," in Section 6.1(iv) and substituting the following phrase therefor: Within 10 days after the delivery of the financial statements required under Section 6.1(i) and within 15 days after the delivery of the financial statements required under Section 6.1(ii), (d) Section 6.21 of the Credit Agreement is amended by deleting the term "Bridge Loan Agreement" both places it appears in clause (i) thereof and substituting the term "New Bridge Loan Agreement" therefor and by deleting the term "Bridge Loan" in clause (ii) thereof and substituting the term "New Bridge Loan" therefor. (e) Section 6.22 of the Credit Agreement is amended by adding to the last sentence thereof after the phrase "the Bridge Loan" the phrase "and the New Bridge Loan". (f) Section 7.5 of the Credit Agreement is amended by amending and restating the parenthetical phrase in the third clause thereof in its entirety to read as follows: (other than by a regularly scheduled payment and other than in connection with the refinancing of the Bridge Loan with the proceeds of the New Bridge Loan and the refinancing of the New Bridge Loan with the proceeds of Permitted Subordinated Indebtedness or Equity Interests of the Borrower) (g) The Credit Agreement is amended by adding a new Exhibit D thereto in the form of Exhibit D attached to this Amendment. 3. Consent. The Lenders hereby consent to the terms of the Senior Subordinated Credit Agreement dated as of January 31, 2000 among the Borrower, the lenders named therein and UBS AG, Stamford Branch, as agent for such lenders (the "New Bridge Loan Agreement"), provided that such terms are substantially the same as those contained in the draft dated January 26, 2000 (12:50 P.M.) of such Senior Subordinated Credit Agreement furnished to the Lenders, and consent to the refinancing of the Bridge Loan with the proceeds of the loans made pursuant to the New Bridge Loan Agreement. 4. Conditions of Effectiveness. This Amendment shall become effective and be deemed effective as of the date hereof (the "Effective Date") if, and only if, the Agent shall have received duly executed originals of this Amendment from the Borrower and the Required Lenders. 5. Representations and Warranties of the Borrower. The Borrower represents and warrants to the Lenders that, as of the Effective Date: (a) there exists no Default or Unmatured Default; and (b) the representations and warranties contained in Article V of the Credit Agreement are true and correct as of the Effective Date except to the extent any such representation or warranty is stated to relate solely to an earlier date, in which case such representation or warranty was true and correct on and as of such earlier date. 6. Reference to and Effect on the Credit Agreement. 6.1 Upon the effectiveness of this Amendment pursuant to Section 4 hereof, on and after the Effective Date each reference in the Credit Agreement to "this Agreement," "hereunder," "hereof," "herein" or words of like import and each reference to the Credit Agreement in each Loan Document shall mean and be a reference to the Credit Agreement as modified hereby. 6.2 Except as specifically waived or amended herein, all of the terms, conditions and covenants of the Credit Agreement and the other Loan Documents shall remain in full force and effect and are hereby ratified and confirmed. 6.3 The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of (a) any right, power or remedy of any Lender or the Agent under the Credit Agreement or any of the Loan Documents, or (b) any Default or Unmatured Default under the Credit Agreement. 7. CHOICE OF LAW. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (INCLUDING 735 ILCS 105/5-1 ET SEQ. BUT OTHERWISE WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS) OF THE STATE OF ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS. 8. Counterparts. This Amendment may be executed in any number of counterparts, each of which when so executed shall be deemed an original and all of which taken together shall constitute one and the same agreement. 9. Headings. Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose. [Signature Pages Follow] IN WITNESS WHEREOF, the Borrower, the Agent and the Lenders have executed this Amendment No. 1 as of the date first above written. BIO-RAD LABORATORIES, INC. By: /s/ Ronald W. Hutton Name: Ronald W. Hutton Title: Treasurer BANK ONE, NA, as a Lender and as Agent By: /s/ Kandis A. Jaffrey Name: Kandis A. Jaffrey Title: Vice President ABN AMRO BANK N.V., as a Lender By: /s/ Amanda C. Cox Name: Amanda C. Cox Title: Vice President By: /s/ Gina M. Brusatori Name: Gina M. Brusatori Title: Group Vice President UNION BANK OF CALIFORNIA, N.A., as a Lender By: /s/ Michael E. Cooper Name: Michael E. Cooper Title: Vice President THE BANK OF NOVA SCOTIA, as a Lender By: /s/ M. Van Otterloo Name: M. Van Otterloo Title: Managing Director, Corporate BANQUE NATIONALE DE PARIS, as a Lender By: /s/ Debra Wright Name: Debra Wright Title:Vice President By: /s/ Sandra Bertram Name: Sandra Bertram Title:Assistant Vice President COOPERATIEVE CENTRALE RAIFFEISEN- BOERENLEENBANK B.A., "RABOBANK INTERNATIONAL", NEW YORK BRANCH, as a Lender By:_________________________________ Name: Title: By:_________________________________ Name: Title: WELLS FARGO BANK, as a Lender By: /s/ Brian S. O'Melveny Name: Brian S. O'Melveny Title: Vice President COMERICA BANK-CALIFORNIA, as a Lender By: /s/ R. Michael Law Name: R. Michael Law Title: Vice President CREDIT LYONNAIS NEW YORK BRANCH, as a Lender By: /s/ Robert Ivosevich Name: Robert Ivosevich Title: Senior Vice President LLOYDS TSB BANK PLC, as a Lender By:/s/ Ian Dimmock Name: Ian Dimmock Title: Vice President By: /s/ Daivd Rodway Name: David Rodway Title: Assistant Director THE NORTHERN TRUST COMPANY, as a Lender By: /s/ Candelario Martinez Name: Candelario Martinez Title: Vice President U.S. BANK, NATIONAL ASSOCIATION, as a Lender By: /s/ Meredith N. Davis Name: Meredith N. Davis Title:Assistant Vice President