SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
----------------------------------
FORM 10-K
(mark one)
[ X ] Annual Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the fiscal year ended December 28, 1996
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Commission file number 1-8002
THERMO ELECTRON CORPORATION
(Exact name of Registrant as specified in its charter)
Delaware 04-2209186
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
81 Wyman Street, P.O. Box 9046
Waltham, Massachusetts 02254-9046
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 622-1000
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
------------------- -------------------
Common Stock, $1.00 par value New York Stock Exchange
Preferred Stock Purchase Rights
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, and (2) has been subject to the
filing requirements for at least 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 the Registrant's knowledge, in definitive proxy or
information statements incorporated by reference into Part III of this Form
10-K or any amendment to this Form 10-K. [ ]
The aggregate market value of the voting stock held by nonaffiliates of the
Registrant as of January 24, 1997, was approximately $5,267,295,000.
As of January 24, 1997, the Registrant had 149,925,557 shares of Common
Stock outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant's Annual Report to Shareholders for the year
ended December 28, 1996, are incorporated by reference into Parts I and II.
Portions of the Registrant's definitive Proxy Statement for the Annual
Meeting of Shareholders to be held on June 3, 1997, are incorporated by
reference into Part III.
PAGE
PART I
Item 1. Business
(a) General Development of Business
Thermo Electron Corporation and its subsidiaries (the Company or the
Registrant) develop, manufacture, and market environmental monitoring and
analysis instruments; biomedical products including heart-assist devices,
respiratory-care equipment, and mammography systems; paper-recycling and
papermaking equipment; alternative-energy systems; industrial process
equipment; and other specialized products. The Company also provides a
range of services for the personal care, environmental, laboratory
analysis, and metals-processing industries, and conducts advanced-
technology research and development. The Company performs its business
through divisions and wholly owned subsidiaries, as well as
majority-owned subsidiaries that are partially owned by the public or by
private investors.
A key element in the Company's growth has been its ability to
commercialize innovative products and services emanating from research
and development activities conducted at the Company's various
subsidiaries and divisions. The Company's strategy has been to identify
business opportunities arising from social, economic, and regulatory
issues, and to seek a leading market share through the application of
proprietary technology. As part of this strategy, the Company continues
to focus on the acquisition of complementary businesses that can be
integrated into its existing core businesses to leverage access to new
markets.
The Company believes that maintaining an entrepreneurial atmosphere
is essential to its continued growth and development. To preserve this
atmosphere, the Company has adopted a strategy of spinning out certain of
its businesses into separate subsidiaries and having these subsidiaries
sell a minority interest to outside investors. The Company believes that
this strategy provides additional motivation and incentives for the
management of the subsidiaries through the establishment of subsidiary-
level stock option incentive programs, as well as capital to support the
subsidiaries' growth. The Company's wholly and majority-owned
subsidiaries are provided with centralized corporate development,
administrative, financial, and other services that would not be available
to many independent companies of similar size. As of March 19, 1997, the
Company had 22 subsidiaries that have sold minority equity interests, 19
of which are publicly traded and three of which are privately held.
The Company is a Delaware corporation and was incorporated in 1956.
The Company completed its initial public offering in 1967 and was listed
on the New York Stock Exchange in 1980.
Forward-looking Statements
Forward-looking statements, within the meaning of Section 21E of the
Securities Exchange Act of 1934, are made throughout this Annual Report
on Form 10-K. For this purpose, any statements contained herein that are
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not statements of historical fact may be deemed to be forward-looking
statements. Without limiting the foregoing, the words "believes,"
"anticipates," "plans," "expects," "seeks," "estimates," and similar
expressions are intended to identify forward-looking statements. There
are a number of important factors that could cause the results of the
Company to differ materially from those indicated by such forward-looking
statements, including those detailed under the caption "Forward-looking
Statements" in the Registrant's 1996 Annual Report to Shareholders
incorporated herein by reference.
(b) Financial Information About Industry Segments
The Company's products and services are divided into six segments:
Instruments, Alternative-energy Systems, Process Equipment, Biomedical
Products, Environmental Services, and Advanced Technologies. Products or
services within a particular segment are provided by more than one
subsidiary, and certain subsidiaries' products or services are included
in more than one segment. The principal products and services offered by
the Company in the six industry segments are described below. Financial
information concerning the Company's industry segments is summarized in
Note 14 to Consolidated Financial Statements in the Registrant's 1996*
Annual Report to Shareholders and is incorporated herein by reference.
(c) Description of Business
(i) Principal Products and Services
Instruments
The Company, through its Thermo Instrument Systems Inc. subsidiary,
is a worldwide leader in the development, manufacture, and marketing of
instruments used to identify and analyze air pollution, radioactivity,
complex chemical compounds, toxic metals, and other elements in a broad
range of liquids, solids, and gases. Thermo Instrument also provides
instruments that control, monitor, image, inspect, and measure various
industrial processes and life sciences phenomena.
Thermo Instrument historically has expanded both through the
acquisition of companies and product lines and through the internal
development of new products and technologies. During the past several
years, Thermo Instrument has completed a number of complementary
acquisitions that have provided additional technologies, specialized
manufacturing or product development expertise, and broader capabilities
in marketing and distribution.
In March 1996, Thermo Instrument completed the acquisition of a
substantial portion of the businesses comprising the Scientific
Instruments Division of Fisons plc, (Fisons) a wholly owned subsidiary of
Rhone-Poulenc Rorer Inc., for approximately 123.5 million British pounds
sterling in cash (approximately $188.9 million) and the assumption of
approximately 30.8 million British pounds sterling of indebtedness
* References to 1996, 1995, and 1994 herein are for the fiscal years
ended December 28, 1996, December 30, 1995, and December 31, 1994,
respectively.
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(approximately $47.2 million). The purchase price is subject to a
post-closing adjustment based on the net assets of the acquired
businesses. The businesses acquired from Fisons substantially added to
Thermo Instrument's research, development, manufacture, and sale of
analytical instruments to industrial and research laboratories worldwide.
Following the acquisition, certain of the Fisons businesses have been
sold by Thermo Instrument to its public subsidiaries with complementary
technologies and markets.
On March 12, 1997, Thermo Instrument declared unconditional in all
respects its cash tender offer for all outstanding shares of Life
Sciences International PLC (Life Sciences) for 135 pence per share
(approximately $2.16 per share). As of that date, Thermo Instrument had
received acceptances representing approximately 91% of the Life Sciences
shares outstanding and Thermo Instrument owned an additional 3% of the
outstanding Life Sciences shares. There are approximately 175 million
Life Sciences shares outstanding. Thermo Instrument has established March
26, 1997, as the date for payment for all shares as to which acceptance
has been received. In addition, Thermo Instrument expects to repay
approximately $72 million of Life Sciences's debt, net of acquired cash
expected to be used. Life Sciences, a London Stock Exchange-listed
company, manufactures laboratory science equipment, appliances,
instruments, consumables, and reagents for the research, clinical, and
industrial markets.
Thermo Instrument adopted the Company's spinout strategy in an
effort to more clearly focus its many analytical technologies on specific
niche markets. To date, Thermo Instrument has completed initial public
offerings of ThermoSpectra Corporation, ThermoQuest Corporation, Thermo
Optek Corporation, and Thermo BioAnalysis Corporation, and a private
equity offering of Metrika Systems Corporation.
ThermoSpectra develops, manufactures, and markets precision imaging,
inspection, and measurement instrumentation based on high-speed data
acquisition and digital-processing technologies to provide industrial and
research customers with integrated systems that address their specific
needs.
ThermoQuest is a leading manufacturer of commercial mass
spectrometers that identify and measure the components of a sample for
organic or inorganic compounds in the pharmaceutical, environmental,
chemical, and food and beverage industries, and in forensic sciences.
ThermoQuest also produces high performance liquid chromatographs, gas
chromatographs, and related equipment used principally in the research
and development and production monitoring of pharmaceuticals and
chemicals, and for environmental monitoring.
Thermo Optek is a worldwide leader in the development, manufacture,
and marketing of analytical instruments that use a range of optical
spectroscopy and energy-based techniques. Thermo Optek's instruments are
used in the quantitative and qualitative chemical analysis of elements
and molecular compounds in a variety of solids, liquids, and gases.
Thermo BioAnalysis develops, manufactures, and markets instruments
and information management systems used in biochemical research and
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production, as well as clinical diagnostics. Thermo BioAnalysis focuses
on three principal product areas: life sciences instrumentation,
information management systems, and health physics instrumentation.
Metrika Systems manufactures process optimization systems that
provide on-line, real-time analysis of the elemental composition of bulk
raw materials in basic materials production processes, including coal,
cement, and minerals. In addition, Metrika Systems manufactures
industrial gauging and process control instruments and systems used
principally by manufacturers of web-type materials, such as sheet metal,
rubber, and plastic foils, to measure and control parameters such as
thickness and coating weight of such materials.
Thermo Instrument also has a number of wholly owned businesses that
manufacture monitoring instruments for three principal markets: the
detection and measurement of nuclear radiation; the monitoring of air
pollutants including toxic and combustible gases; and process monitoring
instruments and control systems for the oil, gas, and petrochemical
industries.
Alternative-energy Systems
The Company's Alternative-energy Systems segment includes the
operation of independent (non-utility) power plants. This segment also
includes the manufacture, sale, and servicing of industrial refrigeration
systems; natural gas and marine engines; packaged cooling and
cogeneration systems; and steam turbines and compressors.
Through its Thermo Ecotek Corporation subsidiary, the Company
designs, develops, owns, and operates independent (non-utility) electric
power generation facilities that use environmentally responsible fuels
including agricultural and wood wastes, referred to as "biomass." Thermo
Ecotek currently operates seven biomass facilities. Its facilities are
developed and operated through joint ventures or limited partnerships in
which it has a majority interest, or through wholly owned subsidiaries.
Thermo Ecotek intends to pursue development of power-generation
projects both in the U.S. and overseas. In 1996, Thermo Ecotek formed a
joint venture in Italy to develop, own, and operate biomass-fueled
electric power facilities, and in January 1997, announced an agreement to
jointly develop a 30-megawatt power project in the Czech Republic.
Thermo Ecotek is expanding beyond biomass power generation into
other products and processes that protect the environment. In August
1995, Thermo Ecotek, through two wholly owned subsidiaries, entered into
a Limited Partnership Agreement with KFx Wyoming, Inc., a subsidiary of
KFx Inc. (in which Thermo Ecotek has a 17.8% interest), to develop,
construct, and operate a coal-beneficiation plant in Gillette, Wyoming.
The plant is expected to begin commercial operation later in 1997 and
will employ patented "clean coal" technology to remove excess moisture
and increase energy from subbituminous coal extracted from Wyoming's
Powder River Basin.
In May 1996, Thermo Ecotek acquired the assets, subject to certain
liabilities, of the biopesticides division of W.R. Grace & Co. (renamed
5PAGE
Thermo Trilogy), which develops, manufactures, and markets
environmentally friendly products for agricultural pest control. In
January 1997, Thermo Trilogy acquired the assets of biosys, inc., a
producer of pheromone, neem/azadiractin, nematodes, and virus-based
biopesticide products, as well as disease-resistant sugar cane.
The Company, through its Thermo Power Corporation subsidiary,
manufactures, markets, and services industrial refrigeration equipment,
natural gas engines for vehicular and stationary applications, marine
engines, fork-lift engines, and commercial cooling and cogeneration
units.
Through its industrial refrigeration business, Thermo Power supplies
standard and custom-designed industrial refrigeration systems used
primarily by the food-processing, petrochemical, and pharmaceutical
industries. Thermo Power's refrigeration packages can be designed for use
with any common refrigerant, but approximately 80% of the units produced
operate on ammonia, a cost-effective and environmentally safe substance
compared with conventional refrigerants based on chlorofluorocarbons.
Thermo Power is also a supplier of both remanufactured and new commercial
cooling equipment for sale or rent.
Thermo Power's engine segment develops, manufactures, markets, and
services gasoline engines for recreational boats; propane and gasoline
engines for lift trucks; and natural gas engines for fleet vehicles and
stationary industrial applications, including cogeneration units, cooling
and refrigeration systems, and compressor drives. Many of Thermo Power's
products are powered by its low-emission TecoDrive(R) engines, which run
solely on compressed natural gas (CNG). Through its privately held
ThermoLyte Corporation subsidiary, Thermo Power is developing and
commercializing a family of lighting products.
The Company's Alternative-energy Systems segment also includes a
U.K.-based manufacturer of steam turbines and compressors.
Process Equipment
The Company designs, manufactures, and sells advanced, custom-
engineered processing machinery; paper-recycling and papermaking
equipment; and thermal-processing and electroplating systems.
Through its Thermo Fibertek Inc. subsidiary, the Company designs and
manufactures processing machinery, accessories, and water-management
systems for the paper and paper-recycling industries. Thermo Fibertek's
custom-engineered systems remove debris, impurities, and ink from
wastepaper, and process it into a fiber mix used to produce recycled
paper. Thermo Fibertek's principal products include custom-engineered
systems and equipment for the preparation of wastepaper for conversion
into recycled paper, accessory equipment and related consumables
important to the efficient operation of papermaking machines, and
water-management systems essential for draining, purifying, and recycling
process water.
A wholly owned subsidiary of the Company entered into a $145 million
contract in December 1994 for engineering, procurement, and construction
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services for an office wastepaper de-inking facility located in
Menominee, Michigan. Thermo Fibertek supplied more than $16 million of
equipment and services under the contract over a two-year period.
Construction of the project was completed in 1996, with startup testing
currently under way.
In September 1996, Thermo Fibergen Inc. became a majority-owned
public subsidiary of Thermo Fibertek. Thermo Fibergen's principal
business consists of conducting research and development to commercialize
equipment and systems for recovering materials from papermaking sludge
generated by plants that produce virgin and recycled pulp and paper.
Thermo Fibergen's GranTek Inc. subsidiary uses a patented process to
convert papermaking sludge into granules that are used as carriers for
agricultural chemicals.
In February 1997, Thermo Fibertek entered into a letter of intent to
acquire the assets, subject to certain liabilities, of the
stock-preparation business of The Black Clawson Company (Black Clawson)
for approximately $110 million in cash. Black Clawson is a leading
supplier of recycling equipment used in processing fiber for the
manufacture of "brown paper," such as that used for corrugated boxes. The
transaction is subject to various conditions of closing.
Through a wholly owned subsidiary, the Company also manufactures
electroplating systems and related waste-treatment equipment and
accessories, as well as aqueous systems for cleaning metal parts without
using ozone-damaging solvents.
Biomedical Products
The Company's Biomedical Products segment comprises a number of
diverse medical products businesses, both wholly and publicly owned. Its
wholly owned Thermo Biomedical group made two acquisitions in 1996:
SensorMedics Corporation, a leading provider of systems for pulmonary
function diagnosis and a producer of respiratory gas analyzers,
physiological testing equipment, and automated sleep analysis systems;
and Medical Data Electronics, a manufacturer of patient-monitoring
systems.
Also part of the Company's Thermo Biomedical group is International
Technidyne Corporation, a leading manufacturer of hemostasis management
products, including blood coagulation-monitoring instruments, and a
producer of skin-incision devices that can draw minute but medically
significant blood samples through precisely controlled incisions.
Nicolet Biomedical Inc., wholly owned subsidiary of the Company, is
a leading manufacturer of biomedical instruments for assessing muscle,
nerve, sleep, hearing, and brain blood-flow disorders, various neurologic
disorders, and for related work in clinical neurophysiology. These
instruments are used in hospitals, clinics, universities, private-
practice medical offices, and medical research facilities.
Another wholly owned subsidiary of the Company, Bird Medical
Technologies, Inc. develops, manufactures, and sells respiratory care
equipment and accessories and infection-control products to hospitals,
7PAGE
subacute care facilities, outpatient surgical centers, doctors, dentists,
the military, as well as other manufactures.
Thermo Cardiosystems Inc., a public subsidiary of Thermedics Inc.,
has developed an implantable left ventricular-assist system (LVAS) called
HeartMate(TM) that, when implanted alongside the natural heart, is
designed to take over the pumping function of the left ventricle for
patients whose hearts are too damaged or diseased to beat adequately on
their own. Thermo Cardiosystems has two versions of the LVAS: a pneumatic
(or air driven) system that can be controlled by either a bedside console
or portable unit, and an electric system that features an internal
electric motor powered by an external battery-pack worn by the patient.
In April 1994, Thermo Cardiosystems received the European Conformity
Mark (CE Mark) for commercial sale of the air-driven LVAS in all European
Community countries. In October 1994, the U.S. Food and Drug
Administration (FDA) granted approval for commercial sale of the
air-driven LVAS in the United States. The electric version of the LVAS,
which received the CE Mark in August 1995, is currently being used in
clinical trials in the U.S. for patients awaiting heart transplants and
may not be sold commercially in this country until it has received FDA
approval. In December 1995, the FDA approved the protocol for conducting
clinical trials using Thermo Cardiosystems' electric LVAS as an
alternative to medical therapy. In December 1996, the Company began
actively working with the FDA on the premarket approval application for
commercial approval of the electric LVAS used as a bridge to transplant.
In Europe, the device is used both as a bridge to transplant and as an
alternative to heart transplants.
In December 1996, Thermo Cardiosystems acquired the business of
Nimbus Medical, Inc., a research and development organization involved
for more than 20 years in ventricular-assist device and total
artificial-heart technology, including high-speed rotary blood pumps,
which are relatively small and could potentially provide cardiac support
in small adults and children.
Trex Medical Corporation, a public subsidiary of ThermoTrex
Corporation, designs, manufactures, and markets a range of medical
imaging systems. It is the world's leading manufacturer of mammography
equipment and minimally invasive stereotactic breast-biopsy systems. Trex
Medical also manufactures general-purpose and specialty radiographic
systems. In 1996, Trex Medical significantly expanded its product lines
through the acquisition of two businesses. XRE Corporation, acquired in
May, designs, manufactures, and markets specialized X-ray systems used in
the diagnosis and treatment of coronary artery disease and other vascular
conditions. Continental X-Ray Corporation, acquired in September,
produces a broad line of general-purpose and specialty X-ray systems,
including radiographic/fluoroscopic systems used in hospitals to diagnose
gastrointestinal disorders, and electrophysiology products that aid
doctors in diagnosing cardiac arrhythmia.
Trex Medical has developed a full-view digital imaging system that
is currently in clinical trials, and plans to submit a 510(k) application
to the FDA in 1997 to gain clearance to market this system commercially.
The advantage of digital imaging is that the radiologist can manipulate
8PAGE
and enhance the image quality to scrutinize subtle differences that may
go undetected on film-based X-rays. After introducing the digital imaging
system for mammography applications, the most technically challenging
imaging modality, Trex Medical plans to develop its flat-panel digital
technology for use in other of its products.
ThermoLase Corporation, a public subsidiary of ThermoTrex, operates
a national network of Spa Thira salons that offer its patented
SoftLight(TM) hair-removal system, for which it received FDA clearance in
April 1995. The SoftLight system uses a low-energy, dermatology laser in
combination with a lotion to remove hair. ThermoLase currently has 10
spas open in the U.S., with two additional spas in development.
ThermoLase also plans to submit a 510(k) application in 1997 for its
laser-based skin-rejuvenation system, based on data from its clinical
trials.
In January 1996, ThermoLase formed a joint venture to market the
SoftLight process in Japan for both hair removal and skin-rejuvenation,
if and when available. In November, ThermoLase entered into a license
agreement with a medical supply and service company in Saudi Arabia, to
market its hair-removal process in that country. A joint venture was also
established with a leading provider of premium hair- and skin-care
services in France in November 1996.
To complement its Spa Thira salons, ThermoLase has commenced a
program to license the SoftLight hair-removal process to qualified
service providers for use in their practices.
ThermoLase also manufactures and markets skin-care, bath, and body
products sold through department stores, salons, and spas, including the
lotion that is an integral part of the SoftLight hair-removal system.
Environmental Services
Through its Thermo TerraTech Inc. subsidiary, the Company provides
environmental and infrastructure planning and design services, with
specialization in the areas of municipal and industrial water quality
management, bridge and highway construction and reconstruction, and
natural resource management. Thermo TerraTech also offers comprehensive
environmental testing and analysis through a national network of
laboratories serving the environmental, food, and pharmaceutical
industries.
Thermo Remediation Inc., a public subsidiary of Thermo TerraTech,
provides services for the recycling of industrial fuel waste, and offers
nuclear remediation and health physics services at radioactively
contaminated sites. Thermo Remediation also operates centers that
thermally treat soil to remove and destroy petroleum contamination from
industrial sites and from former manufactured-gas plants, refineries, and
other sources. Thermo Remediation also offers other remedial solutions,
depending on the location, type, and extent of contamination, including
bioremediation and the application of risk-based corrective actions.
A majority-owned subsidiary of Thermo TerraTech, Thermo EuroTech
N.V., provides wastewater treatment services and specializes in
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converting "off-spec" and contaminated petroleum fluids into usable oil
products.
In addition, metallurgical heat-treating services are provided for
customers in the automotive, aerospace, defense, and other industries.
The Company also provides metallurgical fabrication services, principally
on high-temperature materials, for customers in the aerospace, medical,
electronics, and nuclear industries.
Advanced Technologies
ThermoTrex conducts sponsored research and development and is
attempting to commercialize new products based on advanced technologies
developed in its laboratories. Sponsored research and development,
conducted principally for the U.S. government, includes basic and applied
research in communication, avionics, X-ray detection, signal processing,
advanced-materials technology, and lasers.
ThermoTrex is currently developing a number of technologies that it
believes have future commercial potential. These include a laser
communication system called lasercom, intended to help alleviate capacity
constraints on existing communication systems; a passive microwave camera
intended to "see" through clouds and fog to enhance safety in aerial
navigation; and direct digital imaging systems for medical equipment to
improve image quality for more accurate clinical diagnoses.
Through a public subsidiary of Thermedics, Thermo Sentron Inc., the
Company designs and manufactures high-speed precision-weighing and
inspection equipment for packaging lines and industrial production.
Thermo Sentron serves two principal markets, packaged goods and bulk
materials, both of which use its products to meet quality and
productivity objectives. Customers for Thermo Sentron's checkweighers are
in the food-processing, pharmaceutical, mail-order, and other
packaged-goods businesses. Thermo Sentron also sells metal detectors with
a patented self-test feature, used to inspect packaged products for metal
contamination, to food-processing and pharmaceutical companies. Its
bulk-materials product line includes conveyor-belt scales, solid
level-measurement and conveyor-monitoring systems, and sampling systems,
all sold to customers in the mining and material-processing industries,
as well as to electric utilities, chemical, and other manufacturing
companies.
Thermedics manufactures electrode-based chemical-measurement
products used in the agriculture, biomedical research, food processing,
pharmaceutical, sewage treatment, and many other industries. In
laboratories, manufacturing plants, and in the field, Thermedics'
products permit these industries to determine the presence and amount of
relevant chemicals. Thermedics also manufactures on-line process monitors
used by power plants and semiconductor manufacturers to detect
contaminants in high-purity water.
Thermedics Detection Inc., a public subsidiary of Thermedics,
manufactures quality-assurance and explosives-detection products. Much of
its technology involves rapid contents analysis. Thermedics Detection
provides high-speed X-ray imaging systems that monitor liquid fill-level
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and other container characteristics for the beverage and other industries
that assure the quality of refillable plastic containers that are
principally used outside the United States. Moisture Systems Corporation
and Rutter & Co., B.V., acquired by Thermedics Detection in January 1996,
design, manufacture, and sell instruments that use near-infrared
spectroscopy to measure moisture and other product components, including
fat, protein, solvents, and other substances in numerous consumer and
industrial products. Thermedics Detection also recently introduced an
ultra-high-speed gas chromatograph that permits manufacturers to conduct
laboratory-quality analysis for near on-line process-control
applications.
Thermedics Detection incorporates trace-detection technologies in
products that screen baggage, people, and electronic equipment for the
presence of a range of explosives. Its explosives detectors are in place
at airports and border crossings and in forensics investigations, such as
the attempt to identify the cause of the crash of TWA Flight 800.
Thermedics Detection also has developed a lower-cost product designed for
use in conjunction with its trace explosives detectors, and an automated
system that can detect traces of explosives on people.
Thermo Voltek Corp., a public subsidiary of Thermedics, designs,
manufactures, and markets electromagnetic compatibility (EMC) testing
instruments that simulate pulsed electromagnetic interference, radio
frequency interference, and changes in AC voltage, to allow manufacturers
of electronic systems and integrated circuits to test for resistance to
those conditions. Thermo Voltek also manufactures high-voltage
power-conversion systems and programmable power amplifiers, provides EMC
consulting and systems-integration services, and distributes EMC-related
products.
The Company's wholly owned Coleman Research Corporation subsidiary
provides systems integration, systems engineering, and analytical
services to government and commercial customers in fields of information
technology, software engineering, energy, the environment, launch
systems, advanced radar and imaging, and health systems.
Publicly and Privately Held Subsidiaries
In 1983, the Company adopted a strategy of having certain
subsidiaries sell a minority interest in a public or private offering to
outside investors. An important goal of this strategy is to provide the
entrepreneurial atmosphere and focused performance incentives of a
separate business. As of March 19, 1997, the Company had 22 subsidiaries
that have sold minority equity interests, 19 of which are publicly traded
and three of which are privately held.
Thermedics Inc. develops, manufactures, and markets product quality
assurance systems, precision weighing and inspection equipment,
explosives-detection devices, microweighing and electrochemistry
instruments, as well as biomaterials and other biomedical products.
Thermedics' products are included in the Biomedical Products and Advanced
Technologies segments.
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Thermo Cardiosystems Inc., a majority-owned subsidiary of
Thermedics, develops, manufactures, and markets implantable left
ventricular-assist systems and develops artificial hearts. Thermo
Cardiosystems' products are included in the Biomedical Products
segment.
Thermo Voltek Corp., a majority-owned subsidiary of Thermedics,
designs, manufactures, and markets electromagnetic compatibility
(EMC) testing instruments, high-voltage power-conversion systems,
and programmable power amplifiers; provides EMC consulting and
systems-integration services; and distributes EMC-related products.
Thermo Voltek's products and services are included in the Advanced
Technologies segment.
Thermo Sentron Inc., a majority-owned subsidiary of Thermedics,
develops, manufactures, and markets high-speed precision-weighing
and inspection equipment for producers of bulk materials and for
packaging lines in the food-processing, pharmaceutical, mail-order,
and other diverse industries. Thermo Sentron's products are included
in the Advanced Technologies segment.
Thermedics Detection Inc., a majority-owned subsidiary of
Thermedics, develops, manufactures, and markets high-speed detection
and measurement products used for product quality assurance,
explosives detection, and laboratory analysis. Thermedics
Detection's products are included in the Advanced Technologies
segment.
Thermo Instrument Systems Inc. develops, manufactures, and markets
analytical instruments used to identify complex chemical compounds, toxic
metals, and other elements in a broad range of liquids and solids, as
well instruments used to monitor radioactivity and air pollution, and to
control, image, inspect, and measure various industrial processes and
life sciences phenomena. Thermo Instrument's products represent the
Company's Instruments segment.
ThermoSpectra Corporation, a majority-owned subsidiary of Thermo
Instrument, develops, manufactures, and markets precision imaging,
inspection, and measurement instrumentation based on high-speed data
acquisition and digital-processing technologies.
ThermoQuest Corporation, a majority-owned subsidiary of Thermo
Instrument, develops, manufactures, and sells mass spectrometers,
liquid chromatographs, and gas chromatographs for the
pharmaceutical, environmental, and industrial markets.
Thermo Optek Corporation, a majority-owned subsidiary of Thermo
Instrument, develops, manufactures, and markets optical and
energy-based analytical instruments used in the quantitative and
qualitative chemical analysis of elements and molecular compounds in
solids, liquids, and gases. In addition, through its wholly owned
Thermo Vision Corporation subsidiary, Thermo Optek addresses the
photonics marketplace for optical components, imaging systems,
analytical instruments, and lasers.
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Thermo BioAnalysis Corporation, a majority-owned subsidiary of
Thermo Instrument, develops, manufactures, and markets instruments
and information management systems used in biochemical research and
production, as well as clinical diagnostics and health physics.
Metrika Systems Corporation, a majority-owned, privately held
subsidiary of Thermo Instrument, develops, manufactures, and markets
systems to optimize on-line industrial processes, such as the
production of raw materials and web-type materials, by employing
proprietary, ultra-high speed measurement and analysis technologies.
Thermo TerraTech Inc. provides environmental services and infrastructure
planning and design encompassing a range of specializations within
consulting and design, soil and water remediation, and laboratory
testing. Thermo TerraTech also provides metal-treating services. Thermo
TerraTech's products and services are included in the Environmental
Services and Process Equipment segments.
Thermo Remediation Inc., a majority-owned subsidiary of Thermo
TerraTech, provides environmental services including industrial
remediation, nuclear remediation, hazardous waste remedial cleanup,
soil remediation, and waste fluids recycling. Thermo Remediation's
services are included in the Environmental Services segment.
Thermo EuroTech N.V., a majority-owned, privately held subsidiary of
Thermo TerraTech, provides environmental services in The
Netherlands, including recycling waste oils and refinery and
drilling wastes. Thermo EuroTech's services are included in the
Environmental Services segment.
Thermo Power Corporation manufactures, markets, and services industrial
refrigeration equipment, natural gas engines for vehicular and stationary
applications, natural gas-fueled cooling and cogeneration systems,
lift-truck engines, and marine engines. Thermo Power also conducts
sponsored research and development on advanced systems for clean
combustion and high-efficiency gas-fueled devices. Thermo Power's
products are included in the Alternative-energy Systems segment.
ThermoLyte Corporation, a majority-owned, privately held subsidiary
of Thermo Power, is developing a line of propane-powered lighting
products.
ThermoTrex Corporation manufactures and markets medical imaging
equipment, has developed a laser-based system for the removal of unwanted
hair, and develops advanced technologies that are being developed for
potential incorporation into commercial products for the medical imaging,
personal-care, avionics, and communications industries. ThermoTrex's
products are included in the Company's Biomedical Products and Advanced
Technologies segments.
ThermoLase Corporation, a majority-owned subsidiary of ThermoTrex,
offers laser-based hair-removal services and manufactures skin-care
and other personal-care products sold through department stores,
salons, and spas. ThermoLase's products and services are included in
the Biomedical Products segment.
13PAGE
Trex Medical Corporation, a majority-owned subsidiary of ThermoTrex,
designs, manufactures, and markets mammography equipment and
minimally invasive stereotactic breast-biopsy systems used for the
detection of breast cancer, as well as general-purpose X-ray systems
and interventional X-ray imaging equipment. Trex Medical's products
are included in the Biomedical Products segment.
Thermo Fibertek Inc. develops, manufactures, and markets a range of
equipment and accessory products for the domestic and international paper
and paper-recycling industry, including de-inking and stock-preparation
equipment and water-management systems. Thermo Fibertek's products are
included in the Process Equipment segment.
Thermo Fibergen Inc., a majority-owned subsidiary of Thermo
Fibertek, is developing and commercializing equipment and systems to
recover materials from pulp reside, or sludge, generated by paper
and pulp mills. Thermo Fibergen also produces granules from
papermaking sludge that are sold as carriers for agricultural
chemicals.
Thermo Ecotek Corporation develops and operates independent (non-utility)
power plants that use clean combustion technology and alternative-energy
sources, such as agricultural waste. The Company is also involved in
engineered clean-coal production, as well as the development and
production of botanical-based biopesticides for the agricultural
industry. Thermo Ecotek's operations are included in the Alternative-
energy Systems segment.
(ii) New Products
The Company's business includes the development and introduction of
new products and may include entry into new business segments. The
Company has made no commitments to new products that require the
investment of a material amount of the Company's assets, nor does it have
any definitive plans to enter new business segments that would require
such an investment (see Section (xi) "Research and Development").
(iii) Raw Materials
Certain raw materials used in the manufacturer of Thermo
Cardiosystem's LVAS are available from only one or two suppliers. Thermo
Cardiosystems is making efforts to minimize the risks associated with
sole sources and ensure long-term availability, including qualifying
alternative materials or developing alternative sources for materials and
components supplied by a single source. Although the Company believes
that it has adequate supplies of materials and components to meet demand
for the LVAS for the foreseeable future, no assurance can be given that
the Company will not experience shortages of certain materials or
components in the future that could cause delays in the Thermo
Cardiosystems' LVAS development program or adversely affect Thermo
Cardiosystems' ability to manufacture and ship LVAS to meet demand.
Except as described above, in the opinion of management, the Company
has a readily available supply of raw materials for all of its
14PAGE
significant products from various sources and does not anticipate any
difficulties in obtaining the raw materials essential to its business.
(iv) Patents, Licenses, and Trademarks
The Company considers patents to be important in the present
operation of its business; however, the Company does not consider any
patent, or related group of patents, to be of such importance that its
expiration or termination would materially affect the Company's business
taken as a whole. The Company seeks patent protection for inventions and
developments made by its personnel and incorporated into its products or
otherwise falling within its fields of interest. Patent rights resulting
from work sponsored by outside parties do not always accrue exclusively
to the Company and may be limited by agreements or contracts.
The Company protects some of its technology as trade secrets and,
where appropriate, uses trademarks or registers its products. It also
enters into license agreements with others to grant and/or receive rights
to patents and know-how.
(v) Seasonal Influences
Thermo Ecotek earns a disproportionately high share of its income in
the months of May through October due to the rate structures under the
power sales agreements relating to its California plants, which provide
strong incentives to operate during this period of high demand.
Conversely, Thermo Ecotek historically has operated at a marginal profit
during the first quarter due to the rate structure under these
agreements.
While Thermo TerraTech conducts significant operations year-round,
the majority of its businesses experience seasonal fluctuations due to
adverse weather during winter months. Such seasonal influences may have a
material effect on its revenues. A number of Thermo TerraTech's
operations were affected by adverse weather during the first quarter of
1996.
There are no other material seasonal influences on the Company's
sales of products and services.
(vi) Working Capital Requirements
There are no special inventory requirements or credit terms extended
to customers that would have a material adverse effect on the Company's
working capital.
(vii) Dependency on a Single Customer
No single customer accounted for more than 10% of the Company's
total revenues in any of the past three years. The Advanced Technologies
segment derived approximately 16%, 27%, and 13% of its revenues in 1996,
1995, and 1994, respectively, from contracts with various agencies of the
U.S. government and approximately 23% of its revenues in 1994 from one
customer for a process-detection instrument. In connection with the
development of power plants, Thermo Ecotek typically enters into
15PAGE
long-term power supply contracts with a single customer for the sale of
power generated by each plant. The Alternative-energy Systems segment
derived 16% of its revenues in 1996, 1995, and 1994, from Pacific Gas &
Electric and 16%, 15%, and 19% of its revenues in 1996, 1995, and 1994,
respectively, from Southern California Edison.
(viii) Backlog
The Company's backlog of firm orders at year-end 1996 and 1995 was
as follows:
(In thousands) 1996 1995
-------------------------------------------------------------------------
Instruments $266,600 $188,700
Alternative-energy Systems 118,500 112,900
Process Equipment 52,300 114,800
Biomedical Products 107,700 87,800
Environmental Services 118,200 76,500
Advanced Technologies 148,600 117,200
-------- --------
$811,900 $697,900
======== ========
The Process Equipment segment backlog in 1995 includes $54 million
for the design and construction of an office wastepaper de-inking
facility completed in 1996.
Backlog includes the uncompleted portion of research and development
contracts and the uncompleted portion of certain equipment contracts that
are accounted for using the percentage-of-completion method. The Company
believes approximately 95% of the 1996 backlog will be filled during
1997.
(ix) Government Contracts
Approximately 5% of the Company's total revenues in 1996 were
derived from contracts or subcontracts with the federal government, which
are subject to renegotiation of profits or termination. The Company does
not have any knowledge of threatened or pending renegotiation or
termination of any material contract or subcontract.
(x) Competition
The Company is engaged in many highly competitive industries. The
nature of the competition in each of the Company's markets is described
below:
Instruments
The Company is among the principal manufacturers of analytical
instrumentation. Within the markets for the Company's analytical
instrument products, the Company competes with several large corporations
with broad product offerings, such as Hewlett-Packard Co., Perkin-Elmer
Corp., Varian Associates, Inc., and Hitachi, Ltd., and numerous smaller
companies that address only particular segments of the industry or
16PAGE
specific geographic areas. The Company's instruments business generally
competes on the basis of technical advances that result in new products
and improved price/performance ratios, reputation among customers as a
quality leader for products and services, and active research and
application-development programs. To a lesser extent, the Company
competes on the basis of price.
Alternative-energy Systems
The worldwide independent power market consists of numerous
companies, ranging from small startups to multinational industrial
companies. In addition, a number of regulated utilities have created
subsidiaries that compete as non-utility generators. Non-utility
generators often specialize in market "niches," such as a specific
technology or fuel (for example, gas-fired cogeneration,
refuse-to-energy, hydropower, geothermal, wind, solar, wood, or coal) or
a specific region of the country where they believe they have a market
advantage. However, many non-utility generators, including the Company,
seek to develop projects on a best-available-fuel basis. The Company
competes primarily on the basis of project experience, technical
expertise, capital resources, and power pricing.
The Company's sale of industrial refrigeration systems is subject to
intense competition. The industrial refrigeration market is mature,
highly fragmented, and extremely dependent on close customer contacts.
Major industrial refrigeration companies, of which the Company is one,
account for approximately one-half of worldwide sales, with the balance
generated by many smaller companies. The Company competes principally on
the basis of its advanced control systems and overall quality,
reliability, service, and price. The Company believes it is a leader in
remanufactured refrigeration equipment. The Company competes in this
market based on price, delivery time, and customized equipment.
The Company's sale of packaged cogeneration systems is subject to
intense competition, both direct and indirect. Direct competitors consist
of companies that sell cogeneration products resembling those sold by the
Company as well as electric utilities' pricing programs. Indirect
competitors include manufacturers of conventional heating and cooling
systems.
Competition in the market for natural gas engines for vehicles is
intense. Current and potential competitors include major automotive and
natural gas companies and other companies that have substantially greater
financial resources than those of the Company.
The Company has experienced intense competition in the marine engine
business in recent years as some of its former customers have been
acquired by competitors following the vertical integration of the boating
industry. Competition is primarily on the basis of quality, reliability,
and service.
Process Equipment
The Company faces significant competition in the markets for paper-
recycling and water handling equipment and papermachine accessories, and
17PAGE
competes in these markets primarily on the basis of quality, service,
technical expertise, and product innovation. The Company is a leading
supplier of de-inking systems for paper recycling and accessory equipment
for papermaking machines, and competes in these markets primarily on the
basis of service, technical expertise, and performance.
The market for thermal-processing systems is subject to intense
competition worldwide. The Company is aware of at least eight companies
that market a number of products comparable to the Company's, but
competition for particular projects is typically limited to fewer
companies. The Company competes on the basis of several factors,
including technical performance, product quality and reliability, timely
delivery, and price.
Biomedical Products
Competition in the markets for most of the Company's biomedical
products, including those manufactured by Thermo Cardiosystems,
ThermoTrex, International Technidyne, Nicolet Biomedical, Bird Medical
Technologies, SensorMedics, and Medical Data Electronics, is based to a
large extent upon technical performance.
The Company is aware of one other company that has submitted a PMA
application with the FDA for an implantable LVAS that would compete with
Thermo Cardiosystems' LVAS. The Company is unaware whether this PMA
application has been accepted for filing by the FDA. Also, the Company is
aware of one other company that has received approval by the FDA Advisory
Panel on Circulatory System Devices and subsequent commercial approval
for its cardiac-assist device. This is an external device that is
positioned on the outside of the patient's chest and is intended for
short-term use in the hospital environment. The Company is also aware
that a total artificial heart is currently undergoing clinical trials.
The requirement of obtaining FDA approval for commercial sale of an LVAS
is a significant barrier to entry into the U.S. market for these devices.
There can be no assurance, however, that FDA regulations will not change
in the future, reducing the time and testing required for others to
obtain FDA approval. In addition, other research groups and companies are
developing cardiac-assist systems using alternative technologies or
concepts, one or more of which might prove functionally equivalent to or
more suitable than the Company's systems. Among products that have been
approved for commercial sale, the Company competes primarily on the basis
of performance, service capability, reimbursement status, and price.
The Company is one of a number of competitors in the markets for
mammography and general radiographic systems and is one of two
competitors in the market for stereotactic breast-biopsy systems. The
Company competes in these markets primarily on the basis of product
features, product performance, and reputation, as well as price and
service. The markets in which the Company competes with these products
are characterized by rapid technological change. The Company believes
that in order for it to be competitive in these markets it will be
important for it to continue to be technologically innovative.
The Company's SoftLight laser hair-removal system competes with
other laser-based systems, electrolysis, and other hair-removal products.
18PAGE
In March 1997, Laser Industries Ltd., Mehl/Biophile International Corp.,
and Palomar Medical Technologies Inc. each announced that it had received
clearance from the FDA to market its laser-based system for the removal
of unwanted facial and body hair. The laser-based hair-removal market is
characterized by rapid technological change and the Company believes that
it must continue to be technologically innovative in order to compete in
this market. In addition, the SoftLight system will compete with
electrolysis providers, many of whom are small practitioners with
well-established networks of client relationships. Finally, the SoftLight
system competes with razors, hot wax, and other hair-removal products.
Environmental Services
The Company competes in the market for soil-remediation services
based on its ability to offer customers superior protection from
environmental liabilities. However, with relaxed regulatory standards in
many states, the Company faces intense competition in local markets from
landfills, other treatment technologies, and from companies competing
with similar technologies, limiting the volume of soil to be treated and
the prices that can be charged by the Company. Pricing is therefore a
major competitive factor for the Company.
The Company's metallurgical services business competes in specialty
machining services. Competition is based principally on services
provided, turnaround time, and price.
Hundreds of independent analytical testing laboratories and
consulting firms compete for environmental services business nationwide.
Many of these firms use equipment and processes similar to those of the
Company. Competition is based not only on price, but also on reputation
for accuracy, quality, and the ability to respond rapidly to customer
requirements. In addition, many industrial companies have their own
in-house analytical testing capabilities. The Company believes that its
competitive strength lies in certain niche markets within which the
Company is recognized for its expertise.
Advanced Technologies
In its contract research and development business, the Company not
only competes with other companies and institutions that perform similar
services, but must also rely on the ability of government agencies and
other clients to obtain allocations of research and development monies to
fund contracts with the Company. The Company competes for research and
development programs principally on the basis of technical innovations.
As government funding becomes more scarce, particularly for defense
projects, the competition for such funding will become more intense. In
addition, as the Company's programs move from the development stage to
commercialization, competition is expected to intensify.
Thermedics' electrode-based chemical-measurement products compete
with several international companies. In the markets for these products,
Thermedics competes on the basis of performance, service, technology, and
price.
19PAGE
Thermo Sentron competes with several international and regional
companies in the market for its products. Thermo Sentron's competitors in
the packaged goods market differ from those in the bulk materials market.
The principal competitive factors in both markets are customer service
and support, quality, reliability, and price.
Thermedics Detection's product quality assurance systems compete
with chemical-detection systems manufactured by several companies and
with other technologies and processes for product quality assurance.
Competition in the markets for all of the Company's detection products is
based primarily on performance, service, and price.
There are a number of competitors in the market for instruments that
detect explosives, including makers of other chemical-detection
instruments as well as enhanced X-ray detectors. The Company expects that
the Federal Aviation Administration (FAA) will purchase trace detection
systems as part of the initial deployment of explosives-detection systems
in the United States. The Company believes that companies, if any, whose
devices are ultimately required by the FAA will have a substantial
competitive advantage in the United States.
Thermo Voltek is a leading supplier of pulsed electromagnetic
interference testing equipment. The Company competes in this market
primarily on the basis of performance, technical expertise, reputation,
and price. In the market for power amplifiers, Thermo Voltek competes
with several companies worldwide primarily on the basis of technical
expertise, reputation, and price.
(xi) Research and Development
During 1996, 1995, and 1994, the Company expended $299,271,000,
$269,329,000, and $229,200,000, respectively, on research and
development. Of these amounts, $144,823,000, $167,120,000, and
$149,645,000, respectively, were sponsored by customers and $154,448,000,
$102,209,000, and $79,555,000, respectively, were Company-sponsored.
(xii) Environmental Protection Regulations
The Company believes that compliance with federal, state, and local
environmental protection regulations will not have a material adverse
effect on its capital expenditures, earnings, or competitive position.
(xiii) Number of Employees
At December 28, 1996, the Company employed approximately 17,760
persons.
(d) Financial Information about Exports by Domestic Operations and about
Foreign Operations
Financial information about exports by domestic operations and about
foreign operations is summarized in Note 14 to Consolidated Financial
Statements in the Registrant's 1996 Annual Report to Shareholders and is
incorporated herein by reference.
20PAGE
(e) Executive Officers of the Registrant
Present Title (Year First
Name Age Became Executive Officer)
------------------------ --- --------------------------------------
George N. Hatsopoulos(1) 70 Chairman of the Board, Chief Executive
Officer, and Director (1956)
John N. Hatsopoulos(1) 62 President and Chief Financial Officer
(1968)
Peter G. Pantazelos 66 Executive Vice President (1968)
Arvin H. Smith 67 Executive Vice President (1983)
William A. Rainville 55 Senior Vice President (1993)
John W. Wood Jr. 53 Senior Vice President (1995)
Paul F. Kelleher 54 Vice President, Finance and
Administration (1982)
(1) George N. Hatsopoulos and John N. Hatsopoulos are brothers.
Each executive officer serves until his successor is chosen or
appointed and qualified or until earlier resignation, death, or removal.
All executive officers, except Messrs. John Hatsopoulos, Rainville, and
Wood, have held comparable positions with the Company for at least the
last five years. Mr. John Hatsopoulos has been President of the Company
since January 1997 and Chief Financial Officer of the Company since 1988.
Mr. Rainville has been a Senior Vice President of the Company since 1993
and was a Vice President of the Company from 1986 to 1993. Mr. Wood has
been President and Chief Executive Officer of Thermedics Inc. since 1984
and was a Vice President of the Company from 1994 to 1995, prior to
becoming a Senior Vice President of the Company in 1995.
Item 2. Properties
The location and general character of the Company's principal
properties by industry segment as of December 28, 1996, are as follows:
Instruments
The Company owns approximately 1,973,000 square feet of office,
engineering, laboratory, and production space, principally in California,
Colorado, Florida, New Mexico, Texas, Wisconsin, England, and Germany,
and leases approximately 2,281,000 square feet of office, engineering,
laboratory, and production space principally in California, Connecticut,
Massachusetts, Ohio, Texas, Wisconsin, and England, under leases expiring
from 1997 to 2017.
Alternative-energy Systems
The Company owns approximately 371,000 square feet of office,
engineering, and production space, principally in Pennsylvania, England,
and Massachusetts, and leases approximately 392,000 square feet of
office, engineering, laboratory, and production space principally in
Illinois, Michigan, and England, under leases expiring from 1997 to 2006.
21PAGE
The Company operates four independent power plants in California,
Maine, and New Hampshire, under leases expiring from 2000 to 2010. The
Company owns three independent power plants in New Hampshire and
California and a coal-beneficiation plant in Wyoming.
Process Equipment
The Company owns approximately 1,105,000 square feet of office,
laboratory, and production space, principally in France, Connecticut,
Massachusetts, and New York, and leases approximately 325,000 square feet
of office, engineering, and production space principally in Wisconsin and
Michigan, under leases expiring from 1997 to 2004.
Biomedical Products
The Company owns approximately 412,000 square feet of office and
production space in Illinois, California, Connecticut, and New Jersey,
and leases approximately 1,068,000 square feet of office, engineering,
laboratory, and production space in Texas, Massachusetts, California, New
York, Connecticut, and Illinois, under leases expiring from 1997 to 2012.
Environmental Services
The Company owns approximately 840,000 square feet of office,
laboratory, and production space, principally in California, The
Netherlands, Pennsylvania, and Minnesota, and leases approximately
550,000 square feet of office, engineering, laboratory, and production
space principally in California, Pennsylvania, Massachusetts, New
Hampshire, and New York, under leases expiring from 1997 to 2008.
The Company owns approximately 96 acres of land from which it
provides soil-remediation services principally in Maryland, South
Carolina, and California, and leases approximately 29 acres of land from
which it provides soil-remediation and fluid-recycling services in
principally New York, Arizona, Washington, and Virginia, under leases
expiring from 1997 to 2006.
Advanced Technologies and Corporate Headquarters
The Company owns approximately 153,000 square feet of office space
principally in Massachusetts and New York, and leases approximately
1,108,000 square feet of office, engineering, and laboratory space
principally in Florida, Massachusetts, California, and Minnesota, under
leases expiring from 1997 to 2013.
The Company believes that its facilities are in good condition and
are suitable and adequate to meet its current needs, and that suitable
replacements are available on commercially reasonable terms for any
leases that expire in 1997 in the event that the Company is unable to
renew such leases on reasonable terms.
22PAGE
Item 3. Legal Proceedings
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
PART II
Item 5. Market for Registrant's Common Equity and Related Stockholder
Matters
Information concerning the market and market price for the
Registrant's common stock, $1.00 par value, and related matters, is
included under the sections labeled "Common Stock Market Information" and
"Dividend Policy" in the Registrant's 1996 Annual Report to Shareholders
and is incorporated herein by reference.
Item 6. Selected Financial Data
The information required under this item is included under the
sections "Ten Year Financial Summary" and "Dividend Policy" in the
Registrant's 1996 Annual Report to Shareholders and is incorporated
herein by reference.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The information required under this item is included under the
heading "Management's Discussion and Analysis of Financial Condition and
Results of Operations" in the Registrant's 1996 Annual Report to
Shareholders and is incorporated herein by reference.
Item 8. Financial Statements and Supplementary Data
The Registrant's Consolidated Financial Statements as of December
28, 1996, are included in the Registrant's 1996 Annual Report to
Shareholders and are incorporated herein by reference.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosures
Not Applicable.
23PAGE
PART III
Item 10. Directors and Executive Officers of the Registrant
The information concerning directors required under this item is
incorporated herein by reference from the material contained under the
caption "Election of Directors" in the Registrant's definitive proxy
statement to be filed with the Securities and Exchange Commission
pursuant to Regulation 14A, not later than 120 days after the close of
the fiscal year. The information concerning delinquent filers pursuant to
Item 405 of Regulation S-K is incorporated herein by reference from the
material contained under the heading "Section 16(a) Beneficial Ownership
Reporting Compliance" under the caption "Stock Ownership" in the
Registrant's definitive proxy statement to be filed with the Securities
and Exchange Commission pursuant to Regulation 14A, not later than 120
days after the close of the fiscal year.
Item 11. Executive Compensation
The information required under this item is incorporated herein by
reference from the material contained under the caption "Executive
Compensation" in the Registrant's definitive proxy statement to be filed
with the Securities and Exchange Commission pursuant to Regulation 14A,
not later than 120 days after the close of the fiscal year.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The information required under this item is incorporated herein by
reference from the material contained under the caption "Stock Ownership"
in the Registrant's definitive proxy statement to be filed with the
Securities and Exchange Commission pursuant to Regulation 14A, not later
than 120 days after the close of the fiscal year.
Item 13. Certain Relationships and Related Transactions
The information required under this item is incorporated herein by
reference from the material contained under the caption "Relationship
with Affiliates" in the Registrant's definitive proxy statement to be
filed with the Securities and Exchange Commission pursuant to Regulation
14A, not later than 120 days after the close of the fiscal year.
24PAGE
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on
Form 8-K
(a), (d) Financial Statements and Schedules
(1) The financial statements set forth in the list below are
filed as part of this Report.
(2) The financial statement schedule set forth in the list
below is filed as part of this Report.
(3) Exhibits filed herewith or incorporated herein by
reference are set forth in Item 14(c) below.
List of Financial Statements and Schedules Referenced in this
Item 14
Information incorporated by reference from Exhibit 13 filed
herewith:
Consolidated Statement of Income
Consolidated Balance Sheet
Consolidated Statement of Cash Flows
Consolidated Statement of Shareholders' Investment
Notes to Consolidated Financial Statements
Report of Independent Public Accountants
Financial Schedule included herewith:
Schedule II: Valuation and Qualifying Accounts
All other schedules are omitted because they are not applicable
or not required, or because the required information is shown
either in the financial statements or in the notes thereto.
(b) Reports on Form 8-K
None.
(c) Exhibits
See Exhibit Index on the page immediately preceding exhibits.
25PAGE
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.
Date: March 19, 1997
THERMO ELECTRON CORPORATION
By: George N. Hatsopoulos
---------------------
George N. Hatsopoulos
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of
the Registrant and in the capacities indicated, as of March 19, 1997.
Signature Title
--------- -----
By:George N. Hatsopoulos Chief Executive Officer, Chairman
----------------------
George N. Hatsopoulos of the Board, and Director
By:John N. Hatsopoulos President and Chief Financial
----------------------
John N. Hatsopoulos Officer
By:Paul F. Kelleher Vice President, Finance and Adminis-
----------------------
Paul F. Kelleher tration (Chief Accounting officer)
By:John M. Albertine Director
----------------------
John M. Albertine
By:Peter O. Crisp Director
----------------------
Peter O. Crisp
By:Elias P. Gyftopoulos Director
----------------------
Elias P. Gyftopoulos
By:Frank Jungers Director
----------------------
Frank Jungers
By:Robert A. McCabe Director
----------------------
Robert A. McCabe
By:Frank E. Morris Director
----------------------
Frank E. Morris
By:Donald E. Noble Director
----------------------
Donald E. Noble
By:Hutham S. Olayan Director
----------------------
Hutham S. Olayan
By:Roger D. Wellington Director
----------------------
Roger D. Wellington
26PAGE
Report of Independent Public Accountants
----------------------------------------
To the Shareholders and Board of Directors of
Thermo Electron Corporation:
We have audited in accordance with generally accepted auditing
standards, the consolidated financial statements included in Thermo
Electron Corporation's Annual Report to Shareholders incorporated by
reference in this Form 10-K, and have issued our report thereon dated
February 12, 1997 (except with respect to the matter discussed in Note 16
as to which the date is March 12, 1997). Our audits were made for the
purpose of forming an opinion on those statements taken as a whole. The
schedule listed in Item 14 on page 25 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
consolidated financial statements. This schedule has been subjected to
the auditing procedures applied in the audits of the basic consolidated
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 consolidated financial statements taken as a whole.
Arthur Andersen LLP
Boston, Massachusetts
February 12, 1997
27PAGE
SCHEDULE II
THERMO ELECTRON CORPORATION
Valuation and Qualifying Accounts
(In thousands)
Balance Provision
at Charged Accounts Balance
Beginning to Accounts Written at End
Description of Year Expense Recovered Off Other(a) of Year
- ------------------------------------------------------------------------------
Year Ended
December 28, 1996
Allowance for
Doubtful
Accounts $29,318 $ 6,002 $ 760 $(8,994) $ 7,235 $34,321
Year Ended
December 30, 1995
Allowance for
Doubtful
Accounts $21,664 $ 5,534 $ 5 $(6,422) $ 8,537 $29,318
Year Ended
December 31, 1994
Allowance for
Doubtful
Accounts $14,174 $ 4,225 $ 268 $(4,649) $ 7,646 $21,664
(a) Allowances of businesses acquired during the year as described in Note 3
to Consolidated Financial Statements in the Registrant's 1996 Annual
Report to Shareholders and the effect of foreign currency translation.
28PAGE
EXHIBIT INDEX
-------------
Exhibit
Number Description of Exhibit
-------------------------------------------------------------------------
2.1 Amended and Restated Asset and Stock Purchase Agreement
dated March 29, 1996, among the Registrant, Thermo
Instrument, and Fisons plc (filed as Exhibit 2.1 to the
Registrant's Quarterly Report on Form 10-Q for the quarter
ended March 30, 1996 [File No. 1-8002] and incorporated
herein by reference). Pursuant to Item 601(b)(2) of
Regulation S-K, schedules to this Agreement have been
omitted. The Registrant hereby undertakes to furnish
supplementally a copy of such schedules to the Commission
upon request.
3.1 Restated Certificate of Incorporation of the Registrant, as
amended (filed as Exhibit 3(i) to the Registrant's
Quarterly Report on Form 10-Q for the quarter ended June
29, 1996 [File No. 1-8002] and incorporated herein by
reference).
3.2 By-laws of the Registrant, as amended.
4.1 Fiscal Agency Agreement dated as of April 15, 1994, between
the Registrant and Chemical Bank, pertaining to the
Registrant's 5% Senior Convertible Debentures due 2001
(filed as Exhibit 4.1 to the Registrant's Quarterly Report
on Form 10-Q for the quarter ended April 2, 1994 [File No.
1-8002] and incorporated herein by reference).
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 (filed as Exhibit 4.1 to the Registrant's Annual
Report on Form 10-K for the fiscal year ended December 30,
1995 [File No. 1-8002] and incorporated herein by
reference).
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.
4.2 Rights Agreement dated as of January 19, 1996, between the
Registrant and The First National Bank of Boston, 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 (filed as Exhibit 1 to the Registrant's
Registration Statement on Form 8-A, declared effective by
the Commission on January 31, 1996 [File No. 1-8002] and
incorporated herein by reference).
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Exhibit
Number Description of Exhibit
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10.1 Thermo Electron Corporate Charter as amended and restated
effective January 3, 1993 (filed as Exhibit 10.1 to the
Registrant's Annual Report on Form 10-K for the fiscal year
ended January 2, 1993 [File No. 1-8002] and incorporated
herein by reference).
10.2 Form of Severance Benefit Agreement with officers (filed as
Exhibit 10.15 to the Registrant's Annual Report on Form
10-K for the fiscal year ended December 29, 1990 [File No.
1-8002] and incorporated herein by reference).
10.3 Form of Indemnification Agreement with directors and
officers (filed as Exhibit 10.16 to the Registrant's Annual
Report on Form 10-K for the fiscal year ended December 29,
1990 [File No. 1-8002] and incorporated herein by
reference).
10.4 Loan and Reimbursement Agreement dated as of December 1,
1991, among North County Resource Recovery Associates;
Union Bank of Switzerland; National Westminster Bank PLC
and Banque Paribas, New York Branch, as lead managers;
Credit Local de France as co-lead manager; and Union Bank
of Switzerland as issuing bank and as agent (filed as
Exhibit 10.39 to the Registrant's Annual Report on
Form 10-K for the fiscal year ended January 2, 1993
[File No. 1-8002] and incorporated herein by reference).
10.5 Amended and Restated Reimbursement Agreement dated as of
December 31, 1993, among Chemical Trust Company of
California as Owner Trustee; Delano Energy Company Inc.;
ABN AMRO Bank N.V., Boston Branch, for itself and as Agent;
The First National Bank of Boston, as Co-agent; Barclays
Bank PLC, as Co-agent; Societe Generale, as Co-agent; and
BayBank, as Lead Manager (filed as Exhibit 10.5 to the
Registrant's Annual Report on Form 10-K for the fiscal year
ended January 1, 1994 [File No. 1-8002] and incorporated
herein by reference).
10.6 Amended and Restated Participation Agreement dated as of
December 31, 1991, among Delano Energy Company Inc.; Thermo
Ecotek Corporation (formerly Thermo Energy Systems
Corporation); Chemical Trust Company of California, as
Owner Trustee; ABN AMRO Bank N.V., Boston Branch, as
Co-agent; Bank of Montreal, as Co-agent; Barclays Bank PLC,
as Co-agent; Society Generale, as Co-agent; BayBank, as
Lead Manager; and ABN AMRO Bank N.V., Cayman Island Branch,
and joined in by the Registrant (filed as Exhibit 10.6 to
the Registrant's Annual Report on Form 10-K for the fiscal
year ended January 1, 1994 [File No. 1-8002] and
incorporated herein by reference).
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EXHIBIT INDEX
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Exhibit
Number Description of Exhibit
--------------------------------------------------------------------------
10.7 Turnkey Engineering, Procurement, Construction, and Initial
Operation Agreement for a de-inking pulp facility dated as
of November 1, 1994, between the Registrant, as contractor,
and Great Lakes Pulp Partners I, L.P., as owner (filed as
Exhibit 10.7 to the Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1994 [File No.
1-8002] and incorporated herein by reference). Pursuant to
Item 601(b)(2) of Regulation S-K, schedules to this
Agreement have been omitted. The Company hereby undertakes
to furnish supplementally a copy of such schedules to the
Commission upon request.
10.8 Stock Holdings Assistance Plan and Form of Promissory Note.
10.9 - 10.20 Reserved.
10.21 Deferred Compensation for Directors of the Registrant
(filed as Exhibit 10.5 to the Registrant's Annual Report on
Form 10-K for the fiscal year ended January 3, 1987 [File
No. 1-8002] and incorporated herein by reference). (Maximum
number of shares issuable is 679,218 shares, after
adjustment to reflect share increases approved in 1986 and
1992 and 3-for-2 stock splits effected in October 1986,
October 1993, May 1995, and June 1996.)
10.22 Amended and Restated Directors' Stock Option Plan of the
Registrant (filed as Exhibit 10.25 to the Registrant's
Annual Report on Form 10-K for the fiscal year ended
December 31, 1994 [File No. 1-8002] and incorporated herein
by reference).
10.23 Incentive Stock Option Plan of the Registrant (filed as
Exhibit 4(d) to the Registrant's Registration Statement on
Form S-8 [Reg. No. 33-8993] and incorporated herein by
reference). (Maximum number of shares issuable in the
aggregate under this plan and the Registrant's Nonqualified
Stock Option Plan is 13,552,734 shares, after adjustment to
reflect share increases approved in 1984 and 1986, share
decrease approved in 1989, and 3-for-2 stock splits
effected in October 1986, October 1993, May 1995, and June
1996.)
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EXHIBIT INDEX
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Exhibit
Number Description of Exhibit
--------------------------------------------------------------------------
10.24 Nonqualified Stock Option Plan of the Registrant (filed as
Exhibit 4(e) to the Registrant's Registration Statement on
Form S-8 [Reg. No. 33-8993] and incorporated herein by
reference). (Plan amended in 1984 to extend expiration date
to December 14, 1994; maximum number of shares issuable in
the aggregate under this plan and the Registrant's
Incentive Stock Option Plan is 13,552,734 shares, after
adjustment to reflect share increases approved in 1984 and
1986, share decrease approved in 1989, and 3-for-2 stock
splits effected in October 1986, October 1993, May 1995,
and June 1996.)
10.25 Equity Incentive Plan of the Registrant (filed as Exhibit
10.1 to the Registrant's Quarterly Report on Form 10-Q for
the quarter ended July 2, 1994 [File No. 1-8002] and
incorporated herein by reference). (Plan amended in 1989 to
restrict exercise price for SEC reporting persons to not
less than 50% of fair market value or par value; maximum
number of shares issuable is 10,575,000 shares, after
adjustment to reflect 3-for-2 stock splits effected in
October 1993, May 1995, and June 1996, and share increase
approved in 1994.)
10.26 Thermo Electron Corporation - Thermedics Inc. Nonqualified
Stock Option Plan (filed as Exhibit 4 to a Registration
Statement on Form S-8 of Thermedics [Reg. No. 2-93747] and
incorporated herein by reference). (Maximum number of
shares issuable is 450,000 shares, after adjustment to
reflect share increase approved in 1988, 5-for-4 stock
split effected in January 1985, 4-for-3 stock split
effected in September 1985, and 3-for-2 stock splits
effected in October 1986 and November 1993.)
10.27 Thermo Electron Corporation - Thermo Instrument Systems
Inc. (formerly Thermo Environmental Corporation)
Nonqualified Stock Option Plan (filed as Exhibit 4(c) to a
Registration Statement on Form S-8 of Thermo Instrument
[Reg. No. 33-8034] and incorporated herein by reference).
(Maximum number of shares issuable is 421,875 shares, after
adjustment to reflect 3-for-2 stock splits effected in July
1993 and April 1995, 5-for-4 stock split effected in
December 1995.)
32PAGE
EXHIBIT INDEX
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Exhibit
Number Description of Exhibit
-------------------------------------------------------------------------
10.28 Thermo Electron Corporation - Thermo Instrument Systems
Inc. Nonqualified Stock Option Plan (filed as Exhibit 10.12
to the Registrant's Annual Report on Form 10-K for the
fiscal year ended January 3, 1987 [File No. 1-8002] and
incorporated herein by reference). (Maximum number of
shares issuable is 600,285 shares, after adjustment to
reflect share increase approved in 1988, 3-for-2 stock
splits effected in January 1988, July 1993 and April 1995,
and 5-for-4 stock split effected in December 1995.)
10.29 Thermo Electron Corporation - Thermo TerraTech Inc.
(formerly Thermo Process Systems Inc.) Nonqualified Stock
Option Plan (filed as Exhibit 10.13 to the Registrant's
Annual Report on Form 10-K for the fiscal year ended
January 3, 1987 [File No. 1-8002] and incorporated herein
by reference). (Maximum number of shares issuable is
108,000 shares, after adjustment to reflect 6-for-5 stock
splits effected in July 1988 and March 1989 and 3-for-2
stock split effected in September 1989.)
10.30 Thermo Electron Corporation - Thermo Power Corporation
(formerly Tecogen Inc.) Nonqualified Stock Option Plan
(filed as Exhibit 10.14 to the Registrant's Annual Report
on Form 10-K for the fiscal year ended January 3, 1987
[File No. 1-8002] and incorporated herein by reference).
(Amended in September 1995 to extend the plan expiration
date to December 31, 2005.)
10.31 Thermo Electron Corporation - Thermo Cardiosystems Inc.
Nonqualified Stock Option Plan (filed as Exhibit 10.11 to
the Registrant's Annual Report on Form 10-K for the fiscal
year ended December 29, 1990 [File No. 1-8002] and
incorporated herein by reference). (Maximum number of
shares issuable is 250,000 shares, after adjustment to
reflect share increases approved in 1990, 1992, and 1997,
3-for-2 stock split effected in January 1990, 5-for-4 stock
split effected in May 1990, 2-for-1 stock split effected in
November 1993, and 3-for-2 stock split effected in May
1996.)
10.32 Thermo Electron Corporation - Thermo Ecotek Corporation
(formerly Thermo Energy Systems Corporation) Nonqualified
Stock Option Plan (filed as Exhibit 10.12 to the
Registrant's Annual Report on Form 10-K for the fiscal year
ended December 29, 1990 [File No. 1-8002] and incorporated
herein by reference). (Maximum number of shares issuable is
487,500 shares, after adjustment to reflect 3-for-2 stock
split effected in October 1996.)
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EXHIBIT INDEX
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Exhibit
Number Description of Exhibit
-------------------------------------------------------------------------
10.33 Thermo Electron Corporation - ThermoTrex Corporation
(formerly Thermo Electron Technologies Corporation)
Nonqualified Stock Option Plan (filed as Exhibit 10.13 to
the Registrant's Annual Report on Form 10-K for the fiscal
year ended December 29, 1990 [File No. 1-8002] and
incorporated herein by reference). (Maximum number of
shares issuable is 225,000 shares, after adjustment to
reflect 3-for-2 stock split effected in October 1993 and
share increase approved in March 1997.)
10.34 Thermo Electron Corporation - Thermo Fibertek Inc.
Nonqualified Stock Option Plan (filed as Exhibit 10.14 to
the Registrant's Annual Report on Form 10-K for the fiscal
year ended December 28, 1991 [File No. 1-8002] and
incorporated herein by reference). (Maximum number of
shares issuable is 900,000 shares, after adjustment to
reflect 2-for-1 stock split effected in September 1992 and
3-for-2 stock split effected in September 1995 and June
1996.)
10.35 Thermo Electron Corporation - Thermo Voltek Corp. (formerly
Universal Voltronics Corp.) Nonqualified Stock Option Plan
(filed as Exhibit 10.17 to the Registrant's Annual Report
on Form 10-K for the fiscal year ended January 2, 1993
[File No. 1-8002] and incorporated herein by reference).
(Maximum number of shares issuable is 86,250 shares, after
adjustment to reflect 3-for-2 stock split effected in
November 1993, share increase approved in September 1995,
and 3-for-2 stock split effected in August 1996.)
10.36 Thermo Electron Corporation - Thermo BioAnalysis
Corporation Nonqualified Stock Option Plan (filed as
Exhibit 10.31 to Thermo Power's Annual Report on Form 10-K
for the fiscal year ended September 30, 1995 [File No.
1-10573] and incorporated herein by reference). (Maximum
number of shares issuable is 150,000 shares, after share
increase approved in March 1997.)
10.37 Thermo Electron Corporation - ThermoLyte Corporation
Nonqualified Stock Option Plan (filed as Exhibit 10.32 to
Thermo Power's Annual Report on Form 10-K for the fiscal
year ended September 30, 1995 [File No. 1-10573] and
incorporated herein by reference). (Maximum number of
shares issuable is 150,000 shares, after share increase
approved in March 1997.)
10.38 Thermo Electron Corporation - Thermo Remediation Inc.
Nonqualified Stock Option Plan (filed as Exhibit 10.33 to
Thermo Power's Annual Report on Form 10-K for the fiscal
year ended September 30, 1995 [File No. 1-10573] and
incorporated herein by reference).
34PAGE
EXHIBIT INDEX
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Exhibit
Number Description of Exhibit
-------------------------------------------------------------------------
10.39 Thermo Electron Corporation - ThermoSpectra Corporation
Nonqualified Stock Option Plan (filed as Exhibit 10.34 to
Thermo Power's Annual Report on Form 10-K for the fiscal
year ended September 30, 1995 [File No. 1-10573] and
incorporated herein by reference).
10.40 Thermo Electron Corporation - ThermoLase Corporation
Nonqualified Stock Option Plan (filed as Exhibit 10.35 to
Thermo Power's Annual Report on Form 10-K for the fiscal
year ended September 30, 1995 [File No. 1-10573] and
incorporated herein by reference).
10.41 Thermo Electron Corporation - ThermoQuest Corporation
Nonqualified Stock Option Plan (filed as Exhibit 10.41 to
Thermo Cardiosystems' Annual Report on Form 10-K for the
fiscal year ended December 30, 1995 [File No. 1-10114] and
incorporated herein by reference).
10.42 Thermo Electron Corporation - Thermo Optek Corporation
Nonqualified Stock Option Plan (filed as Exhibit 10.42 to
Thermo Cardiosystems' Annual Report on Form 10-K for the
fiscal year ended December 30, 1995 [File No. 1-10114] and
incorporated herein by reference).
10.43 Thermo Electron Corporation - Thermo Sentron Inc.
Nonqualified Stock Option Plan (filed as Exhibit 10.43 to
Thermo Cardiosystems' Annual Report on Form 10-K for the
fiscal year ended December 30, 1995 [File No. 1-10114] and
incorporated herein by reference).
10.44 Thermo Electron Corporation - Trex Medical Corporation
Nonqualified Stock Option Plan (filed as Exhibit 10.44 to
Thermo Cardiosystems' Annual Report on Form 10-K for the
fiscal year ended December 30, 1995 [File No. 1-10114] and
incorporated herein by reference).
10.45 Thermo Electron Corporation - Thermo Fibergen Inc.
Nonqualified Stock Option Plan (filed as Exhibit 10.19 to
Trex Medical's Annual Report on Form 10-K for the fiscal
year ended September 28, 1996 [File No. 1-11827] and
incorporated herein by reference).
11 Computation of earnings per share.
13 Annual Report to Shareholders for the year ended December
28, 1996 (only those portions incorporated herein by
reference).
21 Subsidiaries of the Registrant.
23 Consent of Arthur Andersen LLP.
27 Financial Data Schedule.
35