SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
__________________________________________
AMENDMENT NO. 1 ON FORM 10-K/A
TO FORM 10-K
(mark one) X Annual Report Pursuant to Section 13 or
-----
15(d) of the Securities Exchange Act of 1934
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
PAGE
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 fiscal year ended December 28, 1996, are incorporated by
reference into Parts I and II.
Part III, Item 10. Directors and Executive Officers of
the Registrant.
Part III, Item 11. Executive Compensation.
Part III, Item 12. Security Ownership of Certain
Beneficial Owners and
Management.
Part III, Item 13. Certain Relationships and
Transactions.
The information required under these items, originally to be
incorporated by reference from the Registrant's definitive proxy
statement to be filed with the Commission pursuant to Regulation
14A, not later than 120 days after the close of the fiscal year,
is contained in the following Attachment A, which is included
herein and made a part of this Annual Report on Form 10-K.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this Amendment No. 1 on Form 10-K/A to be signed by the
undersigned, duly authorized.
THERMO ELECTRON CORPORATION
By: /s/ Sandra L. Lambert
-------------------------------
Sandra L. Lambert
Secretary
ATTACHMENT A
DIRECTORS
Set forth below are the names of the persons serving as
directors and directors whose terms do not expire this year,
PAGE
their ages, their offices in the Corporation, if any, their
principal occupation or employment for the past five years, the
length of their tenure as directors and the names of other public
companies in which such persons hold directorships. Information
regarding their beneficial ownership of the Corporation's Common
Stock and of the common stock of certain subsidiaries of the
Corporation is reported under the caption "Stock Ownership."
John M. Dr. Albertine, 52, has been a director of the
Albertine Corporation since 1986. Dr. Albertine serves as
chairman of the board and chief executive
officer of Albertine Enterprises, Inc., an
economic and public policy consulting firm he
founded in 1990. He also serves as chairman of
The Jian Group Holdings, LLC, a full-service
mergers and acquisitions firm. Dr. Albertine is
also a director of American Precision
Industries, Inc., Bolt, Beranek & Newman, Inc.
and Intermagnetics General Corp.
Peter O. Crisp Mr. Crisp, 64, has been a director of the
Corporation since 1974. Mr. Crisp has been a
general partner of Venrock Associates, a venture
capital investment firm, for more than five
years. Mr. Crisp is also a director of American
Superconductor Corporation, Evans & Sutherland
Computer Corporation, Long Island Lighting
Company, Thermedics Inc., Thermo Power
Corporation, ThermoTrex Corporation and United
States Trust Corporation.
Elias P. Dr. Gyftopoulos, 69, has been a director of the
Gyftopoulos Corporation since 1976. Dr. Gyftopoulos is
Professor Emeritus of the Massachusetts
Institute of Technology, where he was the Ford
Professor of Mechanical Engineering and of
Nuclear Engineering for more than 20 years until
his retirement in 1996. Dr. Gyftopoulos is also
a director of Thermo BioAnalysis Corporation,
Thermo Cardiosystems Inc., ThermoLase
Corporation, Thermo Remediation Inc.,
ThermoSpectra Corporation, Thermo Voltek Corp.
and Trex Medical Corporation.
PAGE
George N. Dr. Hatsopoulos, 70, has been a director, the
Hatsopoulos chairman of the board and chief executive
officer of the Corporation since he founded the
Corporation in 1956. Until March 1997, he was
also the president of the Corporation. Dr.
Hatsopoulos is also a director of Photoelectron
Corporation, Thermedics Inc., Thermo Ecotek
Corporation, Thermo Fibertek Inc., Thermo
Instrument Systems Inc., Thermo Optek
Corporation, ThermoQuest Corporation and
ThermoTrex Corporation. Dr. Hatsopoulos is the
brother of Mr. John N. Hatsopoulos, the
president and the chief financial officer of the
Corporation.
Frank Jungers Mr. Jungers, 70, has been a director of the
Corporation since 1978. Mr. Jungers has been a
consultant on business and energy matters since
1977. Mr. Jungers was employed by the Arabian
American Oil Company from 1974 through 1977 as
chairman and chief executive officer. Mr.
Jungers is also a director of The AES
Corporation, Donaldson, Lufkin & Jenrette,
Georgia-Pacific Corporation, Thermo Ecotek
Corporation and ThermoQuest Corporation.
Robert A. Mr. McCabe, 62, has been a director of the
McCabe Corporation since 1962. He has served as
president of Pilot Capital Corporation, which is
engaged in private investments and provides
acquisition services, since 1987. Prior to that
time Mr. McCabe was a managing director of
Lehman Brothers Inc., an investment banking
firm. Mr. McCabe is also a director of
Borg-Warner Security Corporation, Church &
Dwight Company, Morrison-Knudsen Corporation and
Thermo Optek Corporation.
Frank E. Dr. Morris, 73, has been a director of the
Morris Corporation since 1989. Dr. Morris served as the
Peter Drucker Professor of Management at Boston
College from 1989 to 1994. Dr. Morris also
served as president of the Federal Reserve Bank
of Boston from 1968 until he retired in 1988.
Dr. Morris is a trustee of SEI Liquid Asset
Trust, SEI Cash + Plus Trust, SEI Tax Exempt
Trust, SEI Index Funds, SEI International Trust,
SEI Institutional Managed Trust, The Capitol
Mutual Funds, FFB Lexicon Funds and The Arbor
Fund. Dr. Morris is also a director of Thermo
Remediation Inc.
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PAGE
Donald E. Mr. Noble, 82, has been a director of the
Noble Corporation since 1983. For more than 20 years,
from 1959 to 1980, Mr. Noble served as the chief
executive officer of Rubbermaid, Incorporated,
first with the title of president and then as
chairman of the board. Mr. Noble is also a
director of Thermo Fibertek Inc., Thermo Power
Corporation, Thermo Sentron Inc. and Thermo
TerraTech Inc.
Hutham S. Ms. Olayan, 43, has been a director of the
Olayan Corporation since 1987. She has served as
president and a director of Olayan America
Corporation since 1995 and Competrol Real Estate
Limited since 1986, members of the Olayan Group
engaged in advisory services and private real
estate investments, respectively. Ms. Olayan
also served as president and a director of
Crescent Diversified Limited, a member of the
Olayan Group engaged in private investments,
from 1985 until 1994. Ms. Olayan is also a
director of Trex Medical Corporation.
Roger D. Mr. Wellington, 70, has been a director of the
Wellington Corporation since 1986. Mr. Wellington serves
as the president and chief executive officer of
Wellington Consultants, Inc. and of Wellington
Associates Inc., international business
consulting firms he founded in 1994 and 1989,
respectively. Prior to 1989, Mr. Wellington
served as chairman of the board of Augat Inc., a
manufacturer of electromechanical components,
for more than five years. Prior to 1988, he also
held the positions of president and chief
executive officer of Augat Inc. Mr. Wellington
is also a director of Bolt, Beranek & Newman,
Inc. and Photoelectron Corporation.
Committees of the Board of Directors and Meetings
The Board of Directors has established an Executive
Committee, an Audit Committee and a Human Resources Committee.
The present members of the Executive Committee are Dr.
Hatsopoulos (Chairman), Mr. Crisp, Mr. Jungers and Mr. Noble. The
Executive Committee is empowered to act when it is impractical to
call a meeting of the entire Board of Directors and, with certain
exceptions, has the powers of the Board of Directors. The Audit
Committee consists solely of outside directors, and its present
members are Mr. Jungers (Chairman), Dr. Albertine, Mr. McCabe and
Dr. Morris. The Audit Committee reviews the scope of the audit
with the Corporation's independent public accountants and meets
with them for the purpose of reviewing the results of the audit
subsequent to its completion. The Human Resources Committee
consists solely of outside directors and its present members are
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Mr. Noble (Chairman), Dr. Gyftopoulos, Mr. Jungers, Ms. Olayan
and Mr. Wellington. The Human Resources Committee reviews
corporate organization, reviews the performance of senior members
of management, recommends executive compensation and administers
the Corporation's stock option and other stock-based compensation
plans. The Corporation does not have a nominating committee of
the Board of Directors. The Board of directors met sixteen times,
the Audit Committee met twice, the Executive Committee met once
and the Human Resources Committee met eleven times during fiscal
1996. Each director attended at least 75% of all meetings of the
Board of Directors and committees on which he or she served held
during fiscal 1996.
Compensation of Directors
Cash Compensation
Directors who are not employees of the Corporation or any
companies affiliated with Thermo Electron ("outside directors")
receive an annual retainer of $20,000 and a fee of $1,000 per day
for attending regular meetings of the Board of Directors or its
committees and for each day of consulting for the Board of
Directors, and $500 per day for participating in meetings of the
Board of Directors or such committees held by means of conference
telephone. Payment of directors' fees is made quarterly. Dr. G.
Hatsopoulos, who is a full-time employee of the Corporation, does
not receive any cash compensation from the Corporation for his
service as a director. Directors are also reimbursed for
out-of-pocket expenses and in some instances for travel time
incurred in attending such meetings.
Deferred Compensation Plan for Directors
Under the Corporation's Deferred Compensation Plan for
directors (the "Deferred Compensation Plan"), a director has the
right to defer receipt of his cash fees until he ceases to serve
as a director, dies or retires from his principal occupation. In
the event of a change in control or proposed change in control of
the Corporation that is not approved by the Board of Directors,
deferred amounts become payable immediately. Either of the
following is deemed to be a change of control: (a) the
occurrence, without the prior approval of the Board of Directors,
of the acquisition, directly or indirectly, by any person of 50%
or more of the outstanding Common Stock; or (b) the failure of
the persons serving on the Board of Directors immediately prior
to any contested election of directors or any exchange offer or
tender offer for the Common Stock to constitute a majority of the
Board of Directors at any time within two years following any
such event. Amounts deferred pursuant to the Deferred
Compensation Plan are valued at the end of each quarter as units
of Common Stock. When payable, amounts deferred may be disbursed
solely in shares of Common Stock accumulated under the Deferred
Compensation Plan. A total of 408,907 shares of Common Stock has
been reserved for issuance under the Deferred Compensation Plan.
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PAGE
As of March 1, 1997, deferred units equal to 304,383.44 shares of
Common Stock were accumulated under the Deferred Compensation
Plan.
Directors Stock Option Plan
The Corporation's directors stock option plan (the
"Directors Plan"), provides for the grant of stock options to
purchase shares of common stock of the Corporation and certain of
its majority-owned subsidiaries to outside directors as
additional compensation for their service as directors. Under
the Directors Plan, outside directors are automatically granted
options to purchase 1,000 shares of Common Stock annually. In
addition, the Directors Plan provides for the automatic grant of
options to purchase up to 1,500 shares of the common stock of
certain of the Corporation's publicly traded, majority-owned
subsidiaries and of each majority-owned subsidiary of the
Corporation that is subsequently "spun out" to outside investors.
Pursuant to the Directors Plan, outside directors receive an
annual grant of options to purchase 1,000 shares of Common Stock
at the close of business on the date of each Annual Meeting of
the Stockholders of the Corporation. Options evidencing annual
grants may be exercised at any time from and after the six-month
anniversary of the grant date of the option and prior to the
expiration of the option on the third anniversary of the grant
date. Shares acquired upon exercise of the options are subject
to repurchase by the Corporation at the exercise price if the
recipient ceases to serve as a director of the Corporation or any
other Thermo Electron company prior to the first anniversary of
the grant date.
In addition, under the Directors Plan, outside directors are
automatically granted options to purchase shares of common stock
of certain of the Corporation's publicly traded, majority-owned
subsidiaries as described in the Directors Plan and of each
majority-owned subsidiary of the Corporation that is subsequently
"spun out" to outside investors. Outside directors receive
options to purchase 1,500 shares of common stock for
majority-owned subsidiaries that are directly owned by the
Corporation and 1,000 shares of common stock for majority-owned
subsidiaries that are indirectly owned by the Corporation through
one or more of its other majority-owned subsidiaries. The grant
of options with respect to the common stock of subsidiaries that
are spun out occurs on the close of business on the date of the
first Annual Meeting of the Stockholders next following the
subsidiary's spinout, which is the first to occur of either an
initial public offering of the subsidiary's common stock or a
sale of such stock to third parties in an arms-length
transaction. The options granted vest and become exercisable on
the fourth anniversary of the date of grant, unless prior to such
date the subsidiary's common stock is registered under Section 12
of the Securities Exchange Act of 1934, as amended (''Section 12
Registration"). In the event that the effective date of Section
12 Registration occurs before the fourth anniversary of the grant
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PAGE
date, the option will become immediately exercisable and the
shares acquired upon exercise will be subject to restrictions on
transfer and the right of the Corporation to repurchase such
shares at the exercise price in the event the director ceases to
serve as a director of the Corporation or any other Thermo
Electron company. In the event of Section 12 Registration, the
restrictions and repurchase rights shall lapse or be deemed to
lapse at the rate of 25% per year, starting with the first
anniversary of the grant date. These options expire after five
years. At this Annual Meeting of the Stockholders, each outside
director will be granted options to purchase 1,500 shares of
common stock of Thermo Cardiosystems Inc. and 1,000 shares of the
common stock of each of (i) Thermo Optek, a subsidiary of Thermo
Instrument Systems Inc. that was spun out in June 1996, (ii)
Thermo Fibergen Inc., a subsidiary of Thermo Fibertek Inc. that
was spun out in September 1996, (iii) Metrika Systems
Corporation, a subsidiary of Thermo Instrument Systems Inc. that
was spun out in November 1996 and (iv) Thermedics Detection
Inc., a subsidiary of Thermedics Inc. that was spun out in
November 1996.
The exercise price for options granted under the Directors
Plan is the average of the closing prices of the common stock as
reported on the New York or American Stock Exchange (or other
principal market on which the common stock is then traded) for
the five trading days preceding and including the date of grant,
or, if the shares are not then traded, at the last price per
share paid by third parties in an arms-length transaction prior
to the option grant. An aggregate of 450,000 shares of Common
Stock has been reserved for issuance under the Directors Plan.
Stock Ownership Policies for Directors
During 1996, the Human Resources Committee of the Board of
Directors (the "Committee") established a stock holding policy
for directors. The stock holding policy requires each director
to hold a minimum of 1,000 shares of Common Stock. Directors are
requested to achieve this ownership level by the 1998 Annual
meeting of Stockholders. Directors who are also executive
officers of the Corporation are required to comply with a
separate stock holding policy established by the Committee in
1996.
In addition, the Committee adopted a policy requiring
directors to hold shares of the Corporation's Common Stock equal
to one-half of their net option exercises over a period of five
years. The net option exercise is determined by calculating the
number of shares acquired upon exercise of a stock option, after
deducting the number of shares that could have been traded to
exercise the option and the number of shares that could have been
surrendered to satisfy tax withholding obligations attributable
to the exercise of the option. This policy is also applicable to
executive officers.
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PAGE
STOCK OWNERSHIP
The following table sets forth, as of March 1, 1997, the
beneficial ownership of the Corporation's Common Stock, by (a)
each director, (b) each of the Corporation's executive officers
named in the summary compensation table set forth below under the
heading "Executive Compensation," and (c) all directors and
current executive officers as a group, as well as their
beneficial ownership of each of the Corporation's majority-owned
subsidiaries as follows: (i) Thermo Ecotek Corporation, (ii)
Thermo Fibertek Inc. and Thermo Fibergen Inc., a majority-owned
subsidiary of Thermo Fibertek Inc., (iii) Thermo Power
Corporation and ThermoLyte Corporation, a majority-owned
subsidiary of Thermo Power Corporation, (iv) Thermo TerraTech
Inc. and Thermo Remediation Inc., a majority-owned subsidiary of
Thermo TerraTech Inc., (v) Thermedics Inc. and Thermedics
Detection Inc., Thermo Cardiosystems Inc., Thermo Sentron Inc.
and Thermo Voltek Corp., each a majority-owned subsidiary of
Thermedics Inc., (vi) ThermoTrex Corporation and ThermoLase
Corporation and Trex Medical Corporation, each a majority-owned
subsidiary of ThermoTrex Corporation, and (viii) Thermo
Instrument Systems Inc. and Thermo BioAnalysis Corporation,
Thermo Optek Corporation, ThermoQuest Corporation, ThermoSpectra
Corporation and Metrika Systems Corporation, each a
majority-owned subsidiary of Thermo Instrument Systems Inc. The
common stock of each of the majority-owned subsidiaries is
publicly traded except for the common stock of ThermoLyte
Corporation and Metrika Systems Corporation, which are privately
held.
Thermo Thermo Thermo Thermo Thermo Thermo Thermo Thermo
Electron Ecotek Fibertek Fibergen Power Lyte Tech Remediation
Name Corp Corp Inc. Inc. Corp Corp Inc. Inc.
(2) (3) (4) (5) (6) (7) (8) (9)
John M. Albertine 39,357 2,250 6,750 0 3,000 1,000 1,500 4,500
Peter O. Crisp 98,904 5,191 6,750 4,000 34,161 1,500 3,660 4,500
Elias P. 71,070 2,250 6,750 0 3,000 15,000 1,500 27,600
Gyftopoulos
George N. 3,512,279 25,575 191,910 20,000 54,282 15,000 55,420 7,500
Hatsopoulos
John N. 526,768 35,605 119,155 20,000 45,953 15,000 62,306 42,182
Hatsopoulos
Frank Jungers 245,754 41,850 7,875 1,500 3,000 2,500 1,500 15,450
Robert A. McCabe 47,515 2,250 6,750 0 11,209 1,000 3,660 4,500
Frank E. Morris 23,498 2,250 6,750 0 3,000 1,000 1,500 26,751
Donald E. Noble 54,701 2,250 114,250 3,000 20,472 2,500 49,327 10,500
Hutham S. Olayan 23,995 2,250 6,750 1,000 3,000 1,000 1,500 4,500
William A. 252,294 6,000 517,894 41,500 0 6,000 6,000 24,000
Rainville
Arvin H. Smith 513,038 6,000 90,000 10,000 7,969 6,000 36,997 2,400
Roger D. 34,180 2,250 15,750 0 6,425 1,000 2,500 4,500
Wellington
John W. Wood, Jr. 263,199 3,321 9,000 10,000 0 6,000 0 0
All directors and
current executive
officers as a 6,197,962 157,683 1,200,834 118,000 219,425 79,500 314,800 212,764
group (16 persons)
Thermo
Thermedics Cardio- Thermo Thermo Thermo Thermo Trex
Thermedics Detection systems Sentron Voltek Trex Lase Medical
Name Inc. Inc. Inc. Inc. Corp Corp Corp Corp
(10) (11) (12) (13) (14) (15) (16) (17)
John M. Albertine 4,500 1,000 11,250 1,000 11,250 4,500 2,000 1,000
Peter O. Crisp 46,186 1,500 24,750 2,500 2,250 43,165 2,000 1,000
Elias P. 4,500 1,000 14,500 1,000 3,750 4,500 61,400 40,000
Gyftopoulos
George N. 63,546 0 11,599 17,000 0 48,746 31,125 41,188
Hatsopoulos
John N. 65,618 0 432 30,000 11,623 23,844 63,503 40,983
Hatsopoulos
Frank Jungers 9,000 5,550 11,250 1,000 6,000 11,000 3,300 3,850
Robert A. McCabe 7,915 10,000 11,250 3,000 3,300 10,000 4,100 2,050
Frank E. Morris 4,500 1,000 11,250 1,000 1,500 4,500 2,000 1,000
Donald E. Noble 14,173 1,000 11,250 16,785 1,500 4,500 6,000 1,000
Hutham S. Olayan 4,500 1,000 11,250 1,000 1,500 4,500 2,000 45,199
William A. 0 0 0 7,000 0 2,700 10,000 20,000
Rainville
Arvin H. Smith 91,290 0 30,000 7,000 0 2,700 10,000 20,000
Roger D. 4,500 1,000 11,250 1,000 1,500 4,500 2,000 1,000
Wellington
John W. Wood, Jr. 175,347 27,854 40,332 33,000 93,071 900 10,000 20,000
All directors and
current executive
officers as a 533,809 50,904 205,163 129,285 127,494 187,985 349,371 265,715
group (16 persons)
Thermo
Thermo Bio- Thermo Thermo- Thermo- Metrika
Instrument Analysis Optek Quest Spectra Systems
Name Systems Corp Corp Corp Corp Corp
Inc.
(18) (19) (20) (21) (22) (23)
John M. Albertine 1,875 1,000 0 1,000 1,000 20,000
Peter O. Crisp 17,693 1,000 0 1,000 1,000 0
Elias P. 47,018 15,000 0 1,000 20,000 0
Gyftopoulos
George N. 143,314 25,000 110,000 90,000 20,000 0
Hatsopoulos
John N. 81,204 25,000 120,000 92,100 20,000 0
Hatsopoulos
Frank Jungers 52,568 5,500 10,000 45,565 5,500 0
Robert A. McCabe 53,504 3,000 54,734 1,000 8,318 10,000
Frank E. Morris 1,875 1,000 0 1,000 1,000 0
Donald E. Noble 54,688 3,000 0 2,300 4,000 3,000
Hutham S. Olayan 1,875 1,000 0 1,000 1,000 0
William A. 0 6,000 15,000 15,000 10,000 0
Rainville
Arvin H. Smith 431,667 39,000 98,000 90,000 20,000 0
Roger D. 4,875 1,000 0 1,000 1,000 0
Wellington
John W. Wood, Jr. 15,608 6,000 15,000 15,000 5,000 0
All directors and
current executive
officers as a 954,430 140,500 437,234 368,965 127,318 33,000
group (16 persons)
(1) Except as reflected in the footnotes to this table, shares
of the Common Stock of the Corporation and of the common stock of
each of the Corporation's subsidiaries beneficially owned consist
of shares owned by the indicated person or by that person for the
benefit of minor children, and all share ownership includes sole
voting and investment power.
(2) The number of shares of Common Stock reported in the table
reflects a three-for-two split of such stock distributed in June
1996 in the form of a 50% stock dividend. Shares of the Common
Stock of the Corporation beneficially owned by Dr. Albertine, Mr.
Crisp, Dr. Gyftopoulos, Dr. G. Hatsopoulos, Mr. J. Hatsopoulos,
Mr. Jungers, Mr. McCabe, Dr. Morris, Mr. Noble, Ms. Olayan, Mr.
Rainville, Mr. Smith, Mr. Wellington, Mr. Wood and all directors
and current executive officers as a group include 9,375, 9,375,
9,375, 1,510,300, 429,685, 9,375, 9,375, 9,375, 9,375, 9,375,
205,648, 222,411, 9,375, 227,658 and 2,847,401 shares,
respectively, that such person or members of the group have the
right to acquire within 60 days of March 1, 1997, through the
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exercise of stock options. Shares beneficially owned by Dr. G.
Hatsopoulos, Mr. J. Hatsopoulos, Mr. Smith and all directors and
current executive officers as a group include 2,164, 1,934,
1,717, and 9,687 full shares, respectively, allocated to their
respective accounts maintained pursuant to the Corporation's
employee stock ownership plan (the "ESOP"), of which the
trustees, who have investment power over its assets, are
executive officers of the Corporation. Shares beneficially
owned by Dr. Albertine, Mr. Crisp, Mr. Jungers, Mr. McCabe, Dr.
Morris, Mr. Noble, Ms. Olayan, Mr. Wellington and all directors
and current executive officers as a group include 29,982, 44,885,
80,427, 34,725, 10,708, 41,911, 14,620, 22,275, and 279,533
shares, respectively, allocated to accounts maintained pursuant
to the Corporation's deferred compensation plan for directors.
Shares beneficially owned by Dr. G. Hatsopoulos include 89,601
shares held by his spouse, 168,750 shares held by a QTIP trust of
which his spouse is a trustee, 39,937 shares held by a family
trust of which his spouse is the trustee, and 153 shares
allocated to his spouse's account maintained pursuant to the
ESOP. Shares beneficially owned by Mr. Jungers include 4,500
shares held by Mr. Jungers' spouse. Shares beneficially owned by
Mr. Morris include 3,415 shares held by Mr. Morris' spouse.
Shares beneficially owned by Ms. Olayan do not include 4,300,000
shares owned by Crescent Holding GmbH, a member of the Olayan
Group. Crescent Holding GmbH is indirectly controlled by Suliman
S. Olayan, Ms. Olayan's father. Ms. Olayan disclaims beneficial
ownership of the shares owned by Crescent Holding GmbH. Except
for Dr. G. Hatsopoulos, who beneficially owned 2.3% of the Common
Stock outstanding as of March 1, 1997, no director or executive
officer beneficially owned more than 1% of the Common Stock
outstanding as of such date; all directors and current executive
officers as a group beneficially owned 4.1% of the Common Stock
outstanding as of March 1, 1997.
(3) The number of shares of the common stock of Thermo Ecotek
Corporation reported in the table reflects a three-for-two split
of such stock distributed in October 1996 in the form of a 50%
stock dividend. Shares of the common stock of Thermo Ecotek
Corporation beneficially owned by Dr. Albertine, Mr. Crisp, Dr.
Gyftopoulos, Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers,
Mr. McCabe, Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Rainville, Mr.
Smith, Mr. Wellington and all directors and current executive
officers as a group include 2,250, 2,250, 2,250, 15,000, 13,257,
37,500, 2,250, 2,250, 2,250, 2,250, 6,000, 6,000, 2,250 and
112,257 shares, respectively, that such person or members of the
group have the right to acquire within 60 days of March 1, 1997,
through the exercise of stock options. Shares beneficially owned
by Dr. G. Hatsopoulos include 36 shares held in trusts of which
Dr. G. Hatsopoulos is a trustee. Shares beneficially owned by
Mr. Jungers include 300 shares held by Mr. Jungers' spouse. The
directors and current executive officers did not individually or
as a group beneficially own more than 1% of the Thermo Ecotek
Corporation common stock outstanding as of March 1, 1997.
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PAGE
(4) The number of shares of common stock of Thermo Fibertek Inc.
reported in the table reflects a three-for-two split of such
stock distributed in June 1996 in the form of a 50% stock
dividend. Shares of the common stock of Thermo Fibertek Inc.
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe,
Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Rainville, Mr. Smith, Mr.
Wellington, Mr. Wood and all directors and current executive
officers as a group include 6,750, 6,750, 6,750, 157,910, 97,200,
6,750, 6,750, 6,750, 95,850, 6,750, 495,000, 90,000, 6,750, 9,000
and 1,082,210 shares, respectively, that such person or members
of the group have the right to acquire within 60 days of March 1,
1997, through the exercise of stock options. Shares beneficially
owned by Mr. Noble and all directors and current executive
officers as a group include 5,715 shares allocated to Mr. Noble's
account maintained pursuant to Thermo Fibertek Inc.'s deferred
compensation plan for directors. Shares beneficially owned by Mr.
Jungers include 1,125 shares held by his spouse. No director or
executive officer beneficially owned more than 1% of the Thermo
Fibertek Inc. common stock outstanding as of March 1, 1997; all
directors and current executive officers as a group beneficially
owned 1.9% of the Thermo Fibertek Inc. common stock outstanding
as of such date.
(5) Shares of the common stock of Thermo Fibergen Inc.
beneficially owned by Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr.
Rainville, Mr. Smith, Mr. Wood and all directors and current
executive officers as a group include 20,000, 20,000, 40,000,
10,000, 10,000 and 107,000 shares, respectively, that such person
or members of the group have the right to acquire within 60 days
of March 1, 1997, through the exercise of stock options. The
directors and executive officers of Thermo Electron did not
individually or as a group beneficially own more than 1% of the
Thermo Fibergen Inc. common stock outstanding as of March 1,
1997. In addition, Mr. Crisp, Mr. Jungers, Ms. Olayan, Mr.
Rainville and directors and current executive officers as a group
beneficially owned 4,000, 1,500, 1,000, 1,500 and 8,000
redemption rights, respectively, issued by Thermo Fibergen Inc.
Each of these rights, issued in a public offering in September
1996, permits the holder to sell one share of the Thermo Fibergen
common stock back to Thermo Fibergen Inc. at certain points in
the future at a price of $12.25 per share.
(6) Shares of the common stock of Thermo Power Corporation
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe,
Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Wellington and all
directors and current executive officers as a group include
3,000, 6,600, 3,000, 40,000, 40,000, 3,000, 3,000, 3,000, 7,200,
3,000, 3,000 and 123,800 shares, respectively, that such person
or members of the group have the right to acquire within 60 days
of March 1, 1997, through the exercise of stock options. Shares
beneficially owned by Mr. Crisp, Mr. Noble and all directors and
current executive officers as a group include 9,468, 5,847 and
9
PAGE
15,315 shares, respectively, allocated to their respective
accounts maintained pursuant to Thermo Power Corporation's
deferred compensation plan for directors. Shares beneficially
owned by Dr. G. Hatsopoulos include 114 shares held by Dr. G.
Hatsopoulos' spouse. Shares beneficially owned by Mr. J.
Hatsopoulos include 2,600 shares held by him as custodian for two
minor children. No director or executive officer beneficially
owned more than 1% of the Thermo Power Corporation common stock
outstanding as of March 1, 1997; all directors and current
executive officers as a group beneficially owned 1.7% of the
Thermo Power Corporation common stock outstanding as of such
date.
(7) Shares of the common stock of ThermoLyte Corporation
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe,
Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Rainville, Mr. Smith, Mr.
Wellington, Mr. Wood and all directors and current executive
officers as a group include 1,000, 1,500, 15,000, 15,000, 15,000,
1,000, 1,000, 1,000, 1,500, 1,000, 6,000, 6,000, 1,000, 6,000 and
77,000 shares, respectively, that such person or members of the
group have the right to acquire within 60 days of March 1, 1997,
through the exercise of stock options. Shares beneficially owned
by Mr. Crisp do not include 100,000 shares owned in the aggregate
by entities affiliated with Venrock Associates, of which Mr.
Crisp is both a general and limited partner and for which Mr.
Crisp disclaims beneficial ownership. Shares beneficially owned
by Ms. Olayan do not include 25,000 shares owned by Crescent
International Holdings Limited, a member of the Olayan Group.
Crescent International Holdings Limited is indirectly controlled
by Suliman S. Olayan, Ms. Olayan's father. Ms. Olayan disclaims
beneficial ownership of the shares owned by Crescent
International Holdings Limited. The directors and executive
officers of Thermo Electron did not individually or as a group
beneficially own more than 1% of the ThermoLyte Corporation
common stock outstanding as of March 1, 1997.
(8) Shares of the common stock of Thermo TerraTech Inc.
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe,
Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Rainville, Mr. Smith, Mr.
Wellington and all directors and current executive officers as a
group include 1,500, 1,500, 1,500, 40,000, 40,000, 1,500, 1,500,
1,500, 8,200, 1,500, 60,000, 35,000, 1,500 and 202,200 shares,
respectively, that such person or members of the group have the
right to acquire within 60 days of March 1, 1997, through the
exercise of stock options. Shares beneficially owned by Dr. G.
Hatsopoulos, Mr. J. Hatsopoulos, Mr. Smith and all directors and
current executive officers as a group include 258, 264, 265 and
1,314 full shares, respectively, allocated to their respective
accounts maintained pursuant to the Corporation's ESOP. Shares
beneficially owned by Mr. Noble and all directors and current
executive officers as a group include 18,087 shares allocated to
Mr. Noble's account maintained pursuant to Thermo TerraTech
10
PAGE
Inc.'s deferred compensation plan for directors. Shares
beneficially owned by Mr. J. Hatsopoulos and all directors and
current executive officers as a group include 12,500 shares that
Mr. J. Hatsopoulos has the right to acquire within 60 days of
March 1, 1997, through the exercise of stock purchase warrants
acquired in connection with private placements of securities by
Thermo TerraTech Inc. and one or more of that corporation's
subsidiaries on terms identical to terms granted to outside
investors. Shares beneficially owned by Dr. G. Hatsopoulos
include 93 shares held by his spouse and 3 shares allocated to
his spouse's account maintained pursuant to the Corporation's
ESOP. Shares beneficially owned by Mr. J. Hatsopoulos include
2,000 shares held by him as custodian for two minor children. No
director or executive officer beneficially owned more than 1% of
the Thermo TerraTech Inc. common stock outstanding as of March 1,
1997; all directors and current executive officers as a group
beneficially owned 1.7% of the Thermo TerraTech Inc. common stock
as of such date.
(9) Shares of the common stock of Thermo Remediation Inc.
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe,
Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Rainville, Mr. Smith, Mr.
Wellington and all directors and current executive officers as a
group include 4,500, 4,500, 27,600, 7,500, 22,500, 4,500, 4,500,
24,450, 6,000, 4,500, 22,500, 2,400, 4,500 and 157,350 shares,
respectively, that such person or members of the group have the
right to acquire within 60 days of March 1, 1997, through the
exercise of stock options. Shares beneficially owned by Dr.
Morris and all directors and current executive officers as a
group include 2,301 shares allocated to Dr. Morris' account
maintained pursuant to Thermo Remediation Inc.'s deferred
compensation plan for directors. Shares beneficially owned by Mr.
Jungers include 450 shares held by his spouse. No director or
executive officer beneficially owned more than 1% of the Thermo
Remediation Inc. common stock outstanding as of March 1, 1997;
all directors and current executive officers as a group
beneficially owned 1.7% of the Thermo Remediation Inc. common
stock outstanding as of such date.
(10) Shares of the common stock of Thermedics Inc. beneficially
owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos, Dr. G.
Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe, Dr.
Morris, Mr. Noble, Ms. Olayan, Mr. Smith, Mr. Wellington, Mr.
Wood and all directors and current executive officers as a group
include 4,500, 9,050, 4,500, 50,000, 50,000, 4,500, 4,500, 4,500,
4,500, 4,500, 82,500, 4,500, 125,500 and 372,050 shares,
respectively, that such person or members of the group have the
right to acquire within 60 days of March 1, 1997, through the
exercise of stock options. Shares beneficially owned by Dr. G.
Hatsopoulos, Mr. J. Hatsopoulos, Mr. Smith and all directors and
current executive officers as a group include 1,500, 1,602,
1,445, and 7,523 full shares, respectively, allocated to their
respective accounts maintained pursuant to the Corporation's
11
PAGE
ESOP. Shares beneficially owned by Mr. Crisp and all directors
and current executive officers as a group include 6,841 shares
allocated to Mr. Crisp's account maintained pursuant to
Thermedic's Inc.'s deferred compensation plan for directors.
Shares beneficially owned by Dr. G. Hatsopoulos include 562
shares held by his spouse and 92 shares allocated to the account
of his spouse maintained pursuant to the Corporation's ESOP.
Shares beneficially owned by Mr. Jungers include 1,500 shares
held by Mr. Jungers' spouse. Shares beneficially owned by Mr.
Wood include 2,600 shares held by him as custodian for two minor
children. No director or executive officer beneficially owned
more than 1% of the common stock of Thermedics Inc. outstanding
as of March 1, 1997; all directors and current executive officers
as a group beneficially owned 1.4% of the Thermedics Inc. common
stock outstanding as of such date.
(11) Shares of the common stock of Thermedics Detection Inc.
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Mr. Jungers, Mr. McCabe, Dr. Morris, Mr. Noble, Ms. Olayan, Mr.
Wellington, Mr. Wood and all directors and current executive
officers as a group include 1,000, 1,500, 1,000, 1,000, 1,000,
1,000, 1,000, 1,000, 1,000, 23,333 and 32,833 shares,
respectively, that such person or members of the group have the
right to acquire within 60 days of March 1, 1997, through the
exercise of stock options. Shares beneficially owned by Mr.
Jungers include 1,550 shares held by his spouse. Shares
beneficially owned by Mr. McCabe include 9,000 shares held in a
trust of which he and members of his family are the trustees.
Shares beneficially owned by Ms. Olayan do not include 50,000
shares owned by Crescent International Holdings Limited, a member
of the Olayan Group. Crescent International Holdings Limited is
indirectly controlled by Mr. Suliman S. Olayan, Ms. Olayan's
father. Ms. Olayan disclaims beneficial ownership of the shares
owned by Crescent International Holdings Limited. The directors
and current executive officers did not individually or as a group
beneficially own more than 1% of the Thermedics Detection Inc.
common stock outstanding as of March 1, 1997.
(12) The number of shares of the common stock of Thermo
Cardiosystems Inc. reported in the table reflects a three-for-two
split of such stock distributed in May 1996 in the form of a 50%
stock dividend. Shares of the common stock of Thermo
Cardiosystems Inc. beneficially owned by Mr. Crisp, Dr.
Gyftopoulos, Mr. Jungers, Mr. McCabe, Dr. Morris, Mr. Noble, Ms.
Olayan, Mr. Smith, Mr. Wellington, Mr. Wood and all directors and
current executive officers as a group include 24,750, 14,500,
11,250, 11,250, 11,250, 11,250, 11,250, 30,000, 11,250, 33,450
and 170,200 shares, respectively, that such person or members of
the group have the right to acquire within 60 days of March 1,
1997, through the exercise of stock options. Shares beneficially
owned by Mr. Wood include 1,122 shares held by him as custodian
for two minor daughters. The directors and current executive
officers of Thermo Electron did not individually or as a group
beneficially own more than 1% of the Thermo Cardiosystems Inc.
12
PAGE
common stock outstanding as of March 1, 1997.
(13) Shares of the common stock of Thermo Sentron Inc.
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe,
Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Rainville, Mr. Smith, Mr.
Wellington, Mr. Wood and all directors and current executive
officers as a group include 1,000, 2,500, 1,000, 15,000, 15,000,
1,000, 1,000, 1,000, 15,000, 1,000, 7,000, 7,000, 1,000, 30,000
and 105,500 shares, respectively, that such person or members of
the group have the right to acquire within 60 days of March 1,
1997, through the exercise of stock options. Shares beneficially
owned by Mr. Noble and all directors and current executive
officers as a group include 485 shares allocated to Mr. Noble's
account maintained pursuant to Thermo Sentron Inc.'s deferred
compensation plan for directors. No director or executive
officer beneficially owned more than 1% of the Thermo Sentron
Inc. common stock outstanding as of March 1, 1997; all directors
and current executive officers as a group beneficially owned 1.3%
of the Thermo Sentron Inc. common stock outstanding as of such
date.
(14) The number of shares of the common stock of Thermo Voltek
Corp. reported in the table reflects a three-for-two split of
such stock distributed in August 1996 in the form of a 50% stock
dividend. Shares of the common stock of Thermo Voltek Corp.
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe, Dr. Morris, Mr.
Noble, Ms. Olayan, Mr. Wellington, Mr. Wood and all directors and
current executive officers as a group include 1,500, 2,250,
3,750, 7,498, 1,500, 1,500, 1,500, 1,500, 1,500, 1,500, 78,450
and 102,448 shares, respectively, that such persons or members of
the group have the right to acquire within 60 days of March 1,
1997, through the exercise of stock options. Shares beneficially
owned by Ms. Olayan do not include 10,000 shares owned by
Crescent Growth Fund Ltd., a member of the Olayan Group.
Crescent Growth Fund, Ltd. is indirectly controlled by Mr.
Suliman S. Olayan, Ms. Olayan's father. Ms. Olayan disclaims
beneficial ownership of the shares owned by Crescent Growth Fund,
Ltd. No director or executive officer beneficially owned more
than 1% of the Thermo Voltek Corp. common stock outstanding as of
March 1, 1997; all directors and current executive officers of
Thermo Electron did not individually or as a group beneficially
owned more than 1.3% of the Thermo Voltek Corp. common stock
outstanding as such date.
(15) Shares of the common stock of ThermoTrex Corporation
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe,
Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Rainville, Mr. Smith, Mr.
Wellington, Mr. Wood and all directors and current executive
officers as a group include 4,500, 27,800, 4,500, 36,870, 21,000,
4,500, 4,500, 4,500, 4,500, 4,500, 2,700, 2,700, 4,500, 900 and
140,170 shares, respectively, that such person or members of the
13
PAGE
group have the right to acquire within 60 days of March 1, 1997,
through the exercise of stock options. Shares beneficially owned
by Mr. Crisp and all directors and current executive officers as
a group include 1,921 shares allocated to Mr. Crisp's account
maintained pursuant to ThermoTrex Corporation's deferred
compensation plan for directors. Shares beneficially owned by Dr.
G. Hatsopoulos include 160 shares held by his spouse. The
directors and current executive officers did not individually or
as a group beneficially own more than 1% of the ThermoTrex
Corporation common stock outstanding as of March 1, 1997.
(16) Shares of the common stock of ThermoLase Corporation
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe,
Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Rainville, Mr. Smith, Mr.
Wellington, Mr. Wood and all directors and current executive
officers as a group include 2,000, 22,508, 61,400, 28,800,
53,800, 2,000, 2,000, 2,000, 2,000, 2,000, 10,000, 10,000, 2,000,
10,000 and 287,508 shares, respectively, that such person or
members of the group have the right to acquire within 60 days of
March 1, 1997, through the exercise of stock options. Shares
beneficially owned by Dr. G. Hatsopoulos include 32 shares held
by his spouse. The directors and current executive officers did
not individually or as a group beneficially own more than 1% of
the ThermoLase Corporation common stock outstanding as of March
1, 1997.
(17) Shares of the common stock of Trex Medical Corporation
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe,
Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Rainville, Mr. Smith, Mr.
Wellington, Mr. Wood and all directors and current executive
officers as a group include 1,000, 2,500, 40,000, 40,000, 40,000,
1,000, 1,000, 1,000, 1,000, 40,000, 20,000, 20,000, 1,000, 20,000
and 238,500 shares, respectively, that such person or members of
the group have the right to acquire within 60 days of March 1,
1997, through the exercise of stock options. Shares beneficially
owned by Dr. G. Hatsopoulos includes 16 shares held by his
spouse. Shares beneficially owned by Ms. Olayan do not include
15,000 and 227,000 shares owned by Crescent Growth Fund, Ltd. and
Crescent International Holdings Limited, respectively. Crescent
Growth Fund, Ltd. and Crescent International Holdings Limited are
indirectly controlled by Mr. Suliman S. Olayan, Ms. Olayan's
father. Ms. Olayan disclaims beneficial ownership of these
shares. The directors and current executive officers did not
individually or as a group beneficially own more than 1% of the
Trex Medical Corporation common stock outstanding as of March 1,
1997.
(18) Shares of the common stock of Thermo Instrument Systems Inc.
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe,
Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Smith, Mr. Wellington and
all directors and current executive officers as a group include
14
PAGE
1,875, 1,875, 14,465, 93,750, 65,625, 13,809, 10,995, 1,875,
6,093, 1,875, 234,375, 1,875 and 468,174 shares, respectively,
that such person or members of the group have the right to
acquire within 60 days of March 1, 1997, through the exercise of
stock options. Shares beneficially owned by Dr. G. Hatsopoulos,
Mr. J. Hatsopoulos, Mr. Smith and all directors and current
executive officers as a group include 479, 529, 530 and 2,544
full shares, respectively, allocated to accounts maintained
pursuant to the Corporation's ESOP. Shares beneficially owned by
Mr. Jungers, Mr. McCabe and all directors and current executive
officers as a group include 12,200, 7,126 and 19,326 shares,
respectively, allocated to accounts maintained pursuant to Thermo
Instrument Systems Inc.'s deferred compensation plan for
directors. Shares beneficially owned by Dr. G. Hatsopoulos
include 21,368 shares held by his spouse and 50 shares allocated
to his spouse's account maintained pursuant to the Corporation's
ESOP. Shares beneficially owned by Mr. Jungers include 543
shares held by his spouse. Shares beneficially owned by Mr.
Wood include 15,608 shares held in a trust for his daughter of
which he is the trustee. The directors and current executive
officers did not individually or as a group beneficially own more
than 1% of the Thermo Instrument Systems Inc. common stock
outstanding as of March 1, 1997.
(19) Shares of common stock of Thermo BioAnalysis Corporation
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe,
Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Rainville, Mr. Smith, Mr.
Wellington, Mr. Wood and all directors and current executive
officers as a group include 1,000, 1,000, 15,000, 15,000, 15,000,
1,500, 1,500, 1,000, 1,000, 1,000, 1,000, 6,000, 20,000, 1,000,
6,000 and 91,000 shares, respectively, that such person or
members of the group have the right to acquire within 60 days of
March 1, 1997, through the exercise of stock options. No
director or executive officer beneficially owned more than 1% of
the Thermo BioAnalysis Corporation common stock outstanding as of
March 1, 1997; all directors and current executive officers as a
group beneficially owned 1.4% of the Thermo BioAnalysis
Corporation common stock outstanding as of such date.
(20) Shares of the common stock of Thermo Optek Corporation
beneficially owned by Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr.
McCabe, Mr Rainville, Mr. Smith, Mr. Wood and all directors and
current executive officers as a group include 90,000, 90,000
45,000, 15,000, 90,000, 15,000 and 357,000 shares, respectively,
that such person or members of the group have the right to
acquire within 60 days of March 1, 1997, through the exercise of
stock options. Shares beneficially owned by Mr. McCabe include
6,734 shares issuable upon conversion of $100,000 in principal
amount of the 5% convertible subordinated debenture due 2000
issued by Thermo Optek Corporation. Shares beneficially owned
by Ms. Olayan do not include 20,000 shares owned by Crescent
Growth Fund, Ltd., which is indirectly controlled by Mr. Suliman
S. Olayan, Ms. Olayan's father. Ms. Olayan disclaims beneficial
15
PAGE
ownership of the shares owned by Crescent Growth Fund, Ltd. The
directors and current executive officers did not individually or
as a group beneficially own more than 1% of the Thermo Optek
Corporation common stock outstanding as of March 1, 1997.
(21) Shares of the common stock of ThermoQuest Corporation
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe,
Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Rainville, Mr. Smith, Mr.
Wellington, Mr. Wood and all directors and current executive
officers as a group include 1,000, 1,000, 1,000, 90,000, 90,000,
45,000, 1,000, 1,000, 1,000, 1,000, 15,000, 90,000, 1,000, 15,000
and 365,000 shares, respectively, that such person or members of
the group have the right to acquire within 60 days of March 1,
1997, through the exercise of stock options. Shares beneficially
owned by Mr. Jungers and all directors and current executive
officers as a group include 565 full shares allocated to Mr.
Jungers' account maintained pursuant to ThermoQuest Corporation's
deferred compensation plan for directors. The directors and
current executive officers did not individually or as a group
beneficially own more than 1% of the ThermoQuest Corporation
common stock outstanding as of March 1, 1997.
(22) Shares of the common stock of ThermoSpectra Corporation
beneficially owned by Dr. Albertine, Mr. Crisp, Dr. Gyftopoulos,
Dr. G. Hatsopoulos, Mr. J. Hatsopoulos, Mr. Jungers, Mr. McCabe,
Dr. Morris, Mr. Noble, Ms. Olayan, Mr. Rainville, Mr. Smith, Mr.
Wellington, Mr. Wood and all directors and current executive
officers as a group include 1,000, 1,000, 20,000, 20,000, 20,000,
1,500, 1,500, 1,000, 1,000, 1,000, 10,000, 20,000, 1,000, 3,000
and 109,500 shares, respectively, that such person or members of
the group have the right to acquire within 60 days of March 1,
1997, through the exercise of stock options. Shares beneficially
owned by Mr. Crisp do not include 160,000 shares owned in the
aggregate by entities affiliated with Venrock Associates, of
which Mr. Crisp is both a general and limited partner and for
which Mr. Crisp disclaims beneficial ownership. No director or
executive officer beneficially owned more than 1% of the common
stock of ThermoSpectra Corporation outstanding as of March 1,
1997; all directors and current executive officers as a group
beneficially owned 1.0% of the ThermoSpectra Corporation common
stock outstanding as of such date.
(23) Shares of the common stock of Metrika Systems Corporation
beneficially owned by Dr. Albertine include 6,667 shars held by
Albertine Enterprises, Inc. by it as custodian for two of Dr.
Albertine's partners. Dr. Albertine is the chairman of the board
and chief executive officer of Albertine Enterprises, Inc. and
disclaims beneficial ownership of the shares held by it. Shares
beneficially owned by Mr. McCabe include 10,000 shares held in a
trust of which he and members of his family are the trustees.The
directors and current executive officers did not individually or
as a group beneficially own more than 1% of the Metrika Systems
Corporation common stock outstanding as of March 1, 1997.
16
PAGE
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934
requires the Corporation's directors and executive officers, and
beneficial owners of more than 10% of the Common Stock, to file
with the Securities and Exchange Commission initial reports of
ownership and periodic reports of changes in ownership of the
Corporation's securities. Based upon a review of such filings,
all Section 16(a) filing requirements applicable to such persons
were complied with during 1996, except in the following
instances. A Form 4 for the month of January 1996 filed on
behalf of Mr. John N. Hatsopoulos, then the chief financial
officer and an executive vice president of the Corporation, was
amended in March 1996 to include three transactions consisting of
the exercise of employee stock options. Mr. Robert C. Howard, an
executive vice president of the Corporation in 1996, filed one
Form 4 late reporting one transaction.
17
PAGE
EXECUTIVE COMPENSATION
NOTE: All share amounts reported below have, in all cases, been
adjusted as applicable to reflect three-for-two stock splits
distributed in June 1996, May 1996, October 1996, June 1996 and
August 1996 with respect to the Common Stock and the common stock
of Thermo Cardiosystems Inc., Thermo Ecotek Inc., Thermo Fibertek
Inc. and Thermo Voltek Corp., respectively, each in the form of a
50% stock dividend.
Summary Compensation Table
The following table summarizes compensation for services to
the Corporation in all capacities awarded to, earned by or paid
to the Corporation's chief executive officer and its four other
most highly compensated executive officers for the last three
fiscal years.
Summary Compensation Table
Long Term
Compensation
Securities
Underlying
Annual Options (No. of
Name and Fiscal Compensation Shares All Other
Principal Position Year Salary Bonus and Company) (1) Compen-
(2) sation
(3)
George N. 1996 $520,000 $575,000 100,000 (TMO) $6,750
Hatsopoulos
President and 15,000 (TBA)
Chief Executive
Officer (4)
20,000 (TFG)
15,000 (TLT)
90,000 (TOC)
90,000 (TMQ)
15,000 (TSR)
40,000 (TXM)
1995 $485,000 $550,000 -- $6,750
1994 $450,000 $500,000 20,000 (THS) $6,750
John N. Hatsopoulos 1996 $325,000 $550,000 107,200 (TMO)
Executive Vice 15,000 (TBA)
President 20,000 (TFG)
and Chief
Financial Officer 15,000 (TLT)
(4)
90,000 (TOC)
90,000 (TMQ)
15,000 (TSR)
40,000 (TXM)
1995 $300,000 $500,000 7,800 (TMO) $6,750
25,000 (TLZ)
1994 $280,000 $450,000 144,900 (TMO) $6,750
20,000 (THS)
Arvin H. Smith 1996 $270,000 $260,000 9,000 (TMO) $6,750
Executive Vice 20,000 (TBA)
President
10,000 (TFG)
90,000 (TOC)
90,000 (TMQ)
7,000 (TSR)
20,000 (TXM)
1995 $262,000 $256,200 9,000 (TMO) $6,750
10,000 (TLZ)
6,000 (TLT)
1994 $255,000 $280,500 13,500 (TMO) $6,750
20,000 (THS)
William R. 1996 $205,000 $191,000 6,450 (TMO) $17,558(5)
Rainville
Senior Vice 40,000 (TFG)
President
15,000 (TOC)
15,000 (TMQ)
7,000 (TSR)
20,000 (TXM)
1995 $195,000 $220,000 6,150 (TMO) $15,870
6,000 (TBA)
10,000 (TLZ)
6,000 (TLT)
1994 $182,000 $173,000 96,750 (TMO)
10,000 (THS)
John W. Wood Jr. 1996 $195,000 $172,000 40,500 (TMO) $6,750
(6)
Senior Vice 5,400 (TMD)
President
5,000 (TBA)
10,000 (TFG)
5,000 (TLT)
15,000 (TOC)
15,000 (TMQ)
30,000 (TSR)
2,100 (TVL)
20,000 (TXM)
1995 $180,000 $160,000 40,350 (TMO) $6,750
4,900 (TMD)
1,000 (TBA)
3,450 (TCA)
1,350 (TVL)
10,000 (TLZ)
1,000 (TLT)
(1) In addition to grants of options to purchase Common Stock of
the Corporation (designated in the table as TMO), the named
executive officers have been granted options to purchase common
stock of subsidiaries of the Corporation, either as compensation
for their services to the Corporation or to its subsidiaries.
Options were granted during the last three fiscal years to the
chief executive officer and the other named executive officers in
their capacities as executive officers of the Corporation or
directors or executive officers of the following subsidiaries of
the Corporation: Thermedics Inc. (designated in the table as
TMD), Thermo BioAnalysis Corporation (designated in the table as
TBA), Thermo Cardiosystems Inc. (designated in the table as TCA),
Thermo Fibergen Inc. (designated in the table as TFG), ThermoLase
Corporation (designated in the table as TLZ), ThermoLyte
Corporation (designated in the table as TLT), Thermo Optek
Corporation (designated in the table as TOC), ThermoQuest
Corporation (designated in the table as TMQ), Thermo Sentron Inc.
(designated in the table as TSR), ThermoSpectra Corporation
(designated in the table as THS), Thermo Voltek Corp. (designated
in the table as TVL) and Trex Medical Corporation (designated in
the table as TXM).
(2) No awards of restricted stock of the Corporation were made
to the chief executive officer or other named executive officers
during the last three fiscal years. As of December 28, 1996, the
amount and value of each executive officer's restricted stock
holdings were as follows: Dr. G. Hatsopoulos - 20,250 shares
valued at $764,438; Mr. Smith - 10,125 shares valued at $382,219.
(3) For all executive officers except Mr. Rainville, this amount
represents matching contributions made on behalf of the executive
officer by the Corporation pursuant to the Corporation's 401(k)
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plan. As to Mr. Rainville, this amount represents employer
contributions to his account under the profit sharing plan of
Thermo Web Systems Inc., a subsidiary of Thermo Fibertek Inc.
(4) Mr. John N. Hatsopoulos was appointed the president of the
Corporation effective as of January 1, 1997. Dr. George N.
Hatsopoulos continues to serve as the chairman of the board and
as chief executive officer of the Corporation.
(5) In addition to the matching contribution referred to in
footnote (3), such amount includes $1,313, which represents the
amount of compensation attributable to an interest-free loan
provided to Mr. Rainville pursuant to the stock holding
assistance plan of Thermo Fibertek Inc., a subsidiary of the
Corporation. See "Relationship with Affiliates - Stock Holding
Assistance Plans."
(6) Mr. Wood did not meet the definition of "highly compensated"
within the meaning of the Securities and Exchange Commission's
executive compensation disclosure rules in fiscal 1994.
Stock Options Granted During Fiscal 1996
The following table sets forth information concerning
individual grants of stock options made during fiscal 1996 to the
Corporation's chief executive officer and the other named
executive officers. It has not been the Corporation's policy in
the past to grant stock appreciation rights, and no such rights
were granted during fiscal 1996.
Option Grants in Fiscal 1996
Potential Realizable
Percent Value at Assumed
of
Total Annual Rates of
Options Stock
Number of Granted Exercise Price Appreciation
Securities to for
Underlying Employees Price Expira- Option Term (2)
Options in Per tion
Name Granted (1) Fiscal Share Date
Year 5% 10%
Dr. George N. 50,000(TMO) 3.3% $39.95 09/27/08 $1,589,500 $4,271,500
Hatsopoulos
50,000(TMO) 3.3% $36.25 12/27/08 $1,442,500 $3,876,000
15,000(TBA) 1.8% $10.00 01/31/08 $119,400 $320,700
20,000(TFG) 3.5% $10.00 08/14/08 $159,200 $427,600
15,000(TLT) 4.2% $10.00 02/09/08 $119,400 $320,700
90,000(TOC) 2.9% $12.00 04/11/08 $859,500 $2,309,400
90,000(TMQ) 3.2% $13.00 01/10/08 $931,500 $2,502,000
15,000(TSR) 2.9% $14.00 03/01/08 $167,100 $449,100
40,000(TXM) 1.9% $11.00 03/26/08 $350,000 $940,800
John N. 7,200(TMO) 0.5% $42.79 05/22/99 $48,528 $101,952
Hatsopoulos
50,000(TMO) 3.3% $39.95 09/27/08 $1,589,500 $4,271,500
50,000(TMO) 3.3% $36.25 12/27/08 $1,442,500 $3,876,000
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15,000(TBA) 1.8% $10.00 01/31/08 $119,400 $320,700
20,000(TFG) 3.5% $10.00 08/14/08 $159,200 $427,600
15,000(TLT) 4.2% $10.00 02/09/08 $119,400 $320,700
90,000(TOC) 2.9% $12.00 04/11/08 $859,500 $2,309,400
90,000(TMQ) 3.2% $13.00 01/10/08 $931,500 $2,502,000
15,000(TSR) 2.9% $14.00 03/01/08 $167,100 $449,100
40,000(TXM) 1.9% $11.00 03/26/08 $350,000 $940,800
Arvin H. Smith 9,000(TMO) 0.6% $42.79 05/22/99 $60,660 $127,440
20,000(TBA) 2.4% $10.00 01/31/08 $159,200 $427,600
10,000(TFG) 1.8% $10.00 09/12/08 $79,600 $213,800
90,000(TOC) 2.9% $12.00 04/11/08 $859,500 $2,309,400
90,000(TMQ) 3.2% $13.00 01/10/08 $931,500 $2,502,000
7,000(TSR) 1.4% $14.00 03/11/08 $77,980 $209,580
20,000(TXM) 1.0% $11.00 03/11/08 $175,000 $470,400
William A. 6,450(TMO) 0.4% $42.79 05/22/99 $43,473 $91,332
Rainville
20,000(TFG) 3.5% $10.00 08/14/08 $159,200 $427,600
20,000(TFG) 3.5% $10.00 08/14/08 $159,200 $427,600
15,000(TOC) 0.5% $12.00 04/09/08 $143,250 $384,900
15,000(TMQ) 0.5% $13.00 03/11/08 $155,250 $417,000
7,000(TSR) 1.4% $14.00 03/11/08 $77,980 $209,580
20,000(TXM) 1.0% $11.00 03/11/08 $175,000 $470,400
John W. Wood 37,500(TMO) 2.4% $40.63 04/03/08 $1,212,750 $3,258,000
Jr.
3,000(TMO) 0.2% $42.79 05/22/99 $20,220 $42,480
5,400(TMD) 1.6% $28.13 02/09/99 $23,922 $50,274
5,000(TBA) 0.6% $10.00 03/11/08 $39,800 $106,900
10,000(TFG) 1.8% $10.00 09/12/08 $79,600 $213,800
5,000(TLT) 1.4% $10.00 03/11/08 $39,800 $106,900
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15,000(TOC) 0.5% $12.00 04/09/08 $143,250 $384,900
15,000(TMQ) 0.5% $13.00 03/11/08 $115,250 $417,000
30,000(TSR) 5.8% $14.00 03/01/08 $334,200 $898,200
2,100(TVL) 1.5% $12.78 03/07/99 $4,221 $8,883
20,000(TXM) 1.0% $11.00 03/11/08 $175,000 $470,400
(1) In addition to grants of options to purchase Common Stock of
the Corporation (designated in the table as TMO), the named
executive officers have been granted options to purchase common
stock of Thermedics Inc. (designated in the table as TMD), Thermo
BioAnalysis Corporation (designated in the table as TBA), Thermo
Fibergen Inc.. (designated in the table as TFG), ThermoLyte
Corporation (designated in the table as TLT), Thermo Optek
Corporation (designated in the table as TOC), ThermoQuest
Corporation (designated in the table as TMQ), Thermo Sentron Inc.
(designated in the table as TSR), Thermo Voltek Corp. (designated
in the table as TVL) and Trex Medical Corporation (designated in
the table as TXM), as part of the Corporation's stock option
program. All of the options reported are immediately exercisable
as of the end of the fiscal year, except options to purchase the
common stock of ThermoLyte Corporation, which are not exercisable
until the earlier of (i) 90 days after the effective date of the
registration of that company's common stock under Section 12 of
the Securities Exchange Act of 1934 (the "Exchange Act") and (ii)
nine years after the grant date. In all cases, the shares
acquired upon exercise are subject to repurchase by the granting
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PAGE
corporation at the exercise price if the optionee ceases to be
employed by the granting corporation or another Thermo Electron
company. The granting corporation may exercise its repurchase
rights within six months after the termination of the optionee's
employment. For publicly traded companies, the repurchase rights
lapse ratably over a five- to ten-year period, depending on the
option term, which may vary from seven to twelve years, provided
that the optionee continues to be employed by the granting
corporation or another Thermo Electron company. For companies
whose shares are not publicly traded, the repurchase rights
generally lapse in their entirety on the ninth anniversary of the
grant date. Certain options granted as a part of Thermo
Electron's stock option program have three-year terms, and the
repurchase rights lapse in their entirety on the second
anniversary of the grant date. The granting corporation may
permit the holders of such options to exercise options and to
satisfy tax withholding obligations by surrendering shares equal
in fair market value to the exercise price or withholding
obligation.
(2) The amounts shown on this table represent hypothetical gains
that could be achieved for the respective options if exercised at
the end of the option term. These gains are based on assumed
rates of stock appreciation of 5% and 10% compounded annually
from the date the respective options were granted to their
expiration date. The gains shown are net of the option exercise
price, but do not include deductions for taxes or other expenses
associated with the exercise. Actual gains, if any, on stock
option exercises will depend on the future performance of the
common stock of the granting corporation, the optionee's
continued employment through the option period and the date on
which the options are exercised.
Stock Options Exercised During Fiscal 1996
The following table reports certain information regarding
stock option exercises during fiscal 1996 and outstanding stock
options held at the end of fiscal 1996 by the Corporation's chief
executive officer and the other named executive officers. No
stock appreciation rights were exercised or were outstanding
during fiscal 1996.
20
PAGE
Aggregated Option Exercises In Fiscal 1996 And
Fiscal 1996 Year-End Option Values
Number of
Unexercised
Shares Options at Fiscal Value of
Acquired Year-End Unexercised
on Value (Exercisable/ In-the-Money
Name Company Exercise Realized Unexercisable) Options
(1) (2)
Dr. George N. (TMO) 243,000 $7,914,4301,499,500 /0 $30,114,958/--
Hatsopoulos
(TMD) -- -- 50,000 /0 $117,250/--
(TBA) -- -- 15,000 /0 $46,875/--
(TCK) 39,000 $480,987 15,000 /0 $153,750/--
(TFG) -- -- 20,000 /0 $15,000/--
(TFT) 18,000 $257,994 157,910 /0 $805,710/--
(THI) -- -- 93,750 /0 $1,518,281/--
(TLZ) 14,400 $446,400 28,800 /0 $399,600/--
(TLT) -- -- 0 /15,000 --/$0 (5)
(TOC) -- -- 90,000 /0 $0/--
(THP) -- -- 40,000 /0 $0/--
(TMQ) -- -- 90,000 /0 $0/--
(THN) -- -- 7,500 /0 $13,650/--
(TSR) -- -- 15,000 /0 $0/--
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PAGE
(THS) -- -- 20,000 /0 $37,500/--
(TTT) -- -- 40,000 /0 $18,800/--
(TKN) -- -- 36,600 /0 $554,805/--
(TXM) -- -- 40,000 /0 $65,000/--
John N. (TMO) 124,335 $2,887,545 429,685 /0 (3) $6,252,399/--
Hatsopoulos
(TMD) -- -- 50,000 /0 $117,250/--
(TBA) -- -- 15,000 /0 $46,875/--
(TCK) 40,743 $452,561 13,257 /0 $135,885/--
(TFG) -- -- 20,000 /0 $15,000/--
(TFT) 91,800 $1,119,150 97,200 /0 $469,800/--
(THI) 18,750 $243,031 75,000 /0 $1,214,625/--
(TLZ) 14,400 $342,000 53,800 /0 $399,600/--
(TLT) -- -- 0 /15,000 --/$0 (5)
(TOC) -- -- 90,000 /0 $0/--
(THP) -- -- 40,000 /0 $0/--
(TMQ) -- -- 90,000 /0 $0/--
(THN) -- -- 22,500 /0 $40,950/--
(TSR) -- -- 15,000 /0 $0/--
(THS) -- -- 20,000 /0 $37,500/--
(TTT) -- -- 40,000 /0 $18,800/--
(TKN) 3,000 $92,775 21,000 /0 $276,675/--
(TVL) -- -- 7,498 /0 $57,772/--
(TXM) -- -- 40,000 /0 $65,000/--
Arvin H. Smith (TMO) 60,750 $1,931,728 222,411 /0 $4,885,161/--
(TMD) -- -- 82,500 /0 $785,663/--
(TBA) -- -- 20,000 /0 $62,500/--
(TCA) -- -- 30,000 /0 $657,600/--
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PAGE
(TCK) -- -- 6,000 /0 $70,500/--
(TFG) -- -- 10,000 /0 $7,500/--
(TFT) -- -- 90,000 /0 $540,000/--
(THI) -- -- 234,375 /0 $3,795,703/--
(TLZ) -- -- 10,000 /0 $0/--
(TLT) -- -- 0 /6,000 --/$0 (5)
(TOC) -- -- 90,000 /0 $0/--
(TMQ) -- -- 90,000 /0 $0/--
(THN) -- -- 2,400 /0 $4,368/--
(TSR) -- -- 7,000 /0 $0/--
(THS) -- -- 20,000 /0 $37,500/--
(TTT) -- -- 35,000 /0 $56,000/--
(TKN) -- -- 2,700 /0 $65,273/--
(TXM) -- -- 20,000 /0 $32,500/--
William A (TMO) 5,062 $161,594 205,648 /0 (3) $4,091,585/--
Rainville
(TBA) -- -- 6,000 /0 $18,750/--
(TCK) -- -- 6,000 /0 $70,500/--
(TFG) -- -- 40,000 /0 (4) $30,000/--
(TFT) -- -- 495,000 /0 $2,686,500/--
(TLZ) -- -- 10,000 /0 $0/--
(TLT) -- -- 0 /6,000 --/$0 (5)
(TOC) -- -- 15,000 /0 $0/--
(TMQ) -- -- 15,000 /0 $0/--
(THN) -- -- 22,500 /0 $40,950/--
(TSR) -- -- 7,000 /0 $0/--
(THS) -- -- 10,000 /0 $18,750/--
(TTT) -- -- 60,000 /0 $17,700/--
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PAGE
(TKN) -- -- 2,700 /0 $65,273/--
(TXM) -- -- 20,000 /0 $32,500/--
John W. Wood (TMO) 13,836 $363,383 227,658 /0 (3) $3,088,021/--
Jr.
(TMD) -- -- 125,500 /0 $580,037/--
(TDX) -- -- 0 /23,333 --/$0 (5)
(TBA) -- -- 6,000 /0 $18,750/--
(TCA) 25,775 $1,314,963 33,450 /0 $766,358/--
(TCK) 4,500 $51,188 -- /-- --/--
(TFG) -- -- 10,000 /0 $7,500/--
(TFT) -- -- 9,000 /0 $54,000/--
(TLZ) -- -- 10,000 /0 $0/--
(TLT) -- -- 0 /6,000 --/$0 (5)
(TOC) -- -- 15,000 /0 $0/--
(TMQ) -- -- 15,000 /0 $0/--
(TSR) -- -- 30,000 /0 $0/--
(THS) -- -- 3,000 /0 $5,625/--
(TKN) -- -- 900 /0 $21,758/--
(TVL) 8,623 $61,645 78,450 /0 $319,074/--
(TXM) -- -- 20,000 /0 $32,500/--
4
(1) Options to purchase shares of the following subsidiaries of
the Corporation have been granted to the chief executive officer
and the other named executive officers: Thermedics Inc.
(designated in the table as TMD), Thermedics Detection Inc.
(designated in the table as TDX), Thermo BioAnalysis Corporation
(designated in the table as TBA), Thermo Cardiosystems Inc.
(designated in the table as TCA), Thermo Ecotek Corporation
(designated in the table as TCK), Thermo Fibergen Inc.
(designated in the table as TFG), Thermo Fibertek Inc.
(designated in the table as TFT), Thermo Instrument Systems Inc.
(designated in the table as THI), ThermoLase Corporation
(designated in the table as TLZ), ThermoLyte Corporation
(designated in the table as TLT), Thermo Optek Corporation
(designated in the table as TOC), Thermo Power Corporation
(designated in the table as THP), ThermoQuest Corporation
(designated in the table as TMQ), Thermo Remediation Inc.
(designated in the table as THN), Thermo Sentron Inc. (designated
in the table as TSR), ThermoSpectra Corporation (designated in
the table as THS), Thermo TerraTech Inc. (designated in the table
as TTT), ThermoTrex Corporation (designated in the table as TKN),
Thermo Voltek Corporation (designated in the table as TVL) and
Trex Medical Corporation (designated in the table as TXM).
(2) All of the options reported outstanding at the end of the
fiscal year were immediately exercisable as of fiscal year-end,
except options to purchase the common stock of ThermoLyte
Corporation and Thermedics Detection Inc., which are not
exercisable until the earlier of (i) 90 days after the effective
date of the registration of the company's common stock under
Section 12 of the Exchange Act and (ii) nine years after the
grant date. In all cases, the shares acquired upon exercise of
the options are subject to repurchase by the granting corporation
at the exercise price if the optionee ceases to be employed by
such corporation or another Thermo Electron company. The granting
corporation may exercise its repurchase rights within six months
after the termination of the optionee's employment. For publicly
traded companies, the repurchase rights generally lapse ratably
over a five- to ten-year period, depending on the option term,
which may vary from seven to twelve years, provided that the
optionee continues to be employed by the granting corporation or
another Thermo Electron company. For companies whose shares are
not publicly traded, the repurchase rights lapse in their
entirety on the ninth anniversary of the grant date. Certain
options granted as a part of Thermo Electron's stock option
program have three-year terms, and the repurchase rights lapse in
their entirety on the second anniversary of the grant date.
(3) Options to purchase 135,000, 90,000 and 90,000 shares of the
21
PAGE
Common Stock granted to Messrs. J. Hatsopoulos, Rainville and
Wood, respectively, are subject to the same terms as described in
footnote (2), except that the repurchase rights of the granting
corporation generally do not lapse until the tenth anniversary of
the grant date. In the event of the employee's death or
involuntary termination prior to the tenth anniversary of the
grant date, the repurchase rights of the granting corporation
shall be deemed to have lapsed ratably over a five-year period
commencing with the fifth anniversary of the grant date.
(4) Options to purchase 20,000 shares of the common stock of
Thermo Fibergen Inc. granted to Mr. Rainville are subject to the
same terms as described in footnote (2), except that the
repurchase rights are deemed to lapse 20% per year commencing on
the sixth anniversary of the grant date.
(5) No public market for the shares underlying these options
existed at fiscal year-end. Accordingly, no value in excess of
exercise price has been attributed to these options.
Defined Benefit Retirement Plan
Thermo Web Systems Inc., a wholly owned subsidiary of Thermo
Fibertek Inc., maintains a defined benefit retirement plan (the
"Retirement Plan") for eligible U.S. employees. Mr. Rainville is
the chief executive officer of Thermo Fibertek Inc. and the only
executive officer of the Corporation who participates in the
Retirement Plan. The following table sets forth the estimated
annual benefits payable under the Retirement Plan upon retirement
to employees of the subsidiary in specified compensation and
years-of-service classifications. The estimated benefits at
certain compensation levels reflect the statutory limits on
compensation that can be recognized for plan purposes. This limit
is currently $150,000 per year.
Years of Service
Annual 15 20 25 30 35
Compensation
$100,000 $25,250 $35,000 $43,750 $48,125 $48,125
$125,000 $32,813 $43,750 $54,688 $60,156 $60,156
$150,000 $39,375 $52,500 $65,625 $72,188 $72,188
Each eligible employee receives a monthly retirement
benefit, beginning at normal retirement age (65), based on a
percentage (1.75%) of the average monthly compensation of such
employee before retirement, multiplied by his years of service
(up to a maximum of 30 years). Full credit is given for the first
25 years of service, and half credit is given for years over 25
and less than 30. Benefits are reduced for retirement before
normal retirement age. Average monthly compensation is generally
defined as average monthly base salary over the five years of
highest compensation in the ten-year period preceding retirement.
For 1995, the annual compensation of Mr. Rainville recognized for
plan purposes was $150,000. The estimated credited years of
service recognized under the Retirement Plan for Mr. Rainville is
30, assuming retirement at age 65. No benefits under the
Retirement Plan vest for an employee until after five years of
22
PAGE
participation, at which time they become fully vested. The
benefits shown in the above table are subject to reduction for
Social Security benefits. The plan benefits shown are payable
during the employee's lifetime unless the employee elects another
form of benefit that provides death benefit protection.
Severance Agreements
The executive officers and certain key employees of the
Corporation have entered into contracts with the Corporation that
provide severance benefits if there is a change of control of the
Corporation that is not approved by the Board of Directors and
their employment is terminated, for whatever reason, within one
year thereafter. For purposes of these agreements a change of
control exists upon (i) the acquisition of 50% or more of the
outstanding Common Stock by any person without the prior approval
of the Board of Directors, (ii) the failure of the Board of
Directors, within two years after any contested election of
directors or tender or exchange offer not approved by the Board
of Directors, to be constituted of a majority of directors
holding office prior to such event or (iii) any other event that
the Board of Directors determines constitutes an effective change
of control of Thermo Electron.
In 1983, the Corporation entered into severance agreements
with all of the named executive officers, except Mr. Rainville
and Mr. Wood. For these severance agreements, the benefit is
stated as an initial percentage which was established by the
Board of Directors and was generally based upon the employee's
age and length of service with the Corporation. Benefits are to
be paid over a five-year period. The benefit to be paid in the
first year is determined by applying this percentage to the
employee's highest annual total cash remuneration in any 12-month
period during the preceding three years. This benefit is reduced
10% in each of the succeeding four years in which benefits are
paid. The initial percentage to be so applied to Dr. G.
Hatsopoulos, Mr. J. Hatsopoulos and Mr. Smith is 98.1%, 76.1% and
59.1%, respectively. Assuming that severance benefits would have
been payable under such agreements as of March 1, 1997, the
payments thereunder for the first year thereof to Dr. G.
Hatsopoulos, Mr. J. Hatsopoulos and Mr. Smith would have been
approximately $1,074,000, $665,000 and $313,000, respectively.
Payments under these agreements are not subject to the so-called
"excess parachute payment" provisions under applicable provisions
of the Internal Revenue Code of 1986, as amended.
During 1988, Mr. Rainville and Mr. Wood each entered into a
severance agreement with the Corporation pursuant to which he
will receive a lump sum benefit at the time of a qualifying
severance equal to the highest total cash compensation paid to
him in any twelve-month period during the three years preceding
the severance event. A qualifying severance exists if (i) the
officer's employment is terminated for any reason within one year
after a change in control of the Corporation or (ii) a group of
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PAGE
directors of the Corporation consisting of directors of the
Corporation on the date of the severance agreement or, if an
election contest or tender or exchange offer for the
Corporation's Common Stock has occurred, the directors of the
Corporation immediately prior to such election contest or tender
or exchange offer, and any future directors who are nominated or
elected by such directors, determines that any other termination
of the officer's employment should be treated as a qualifying
severance. The benefits under this agreement are limited in such
a manner that the payments will not constitute "excess parachute
payments" under applicable provisions of the Internal Revenue
Code of 1986, as amended. Assuming that severance benefits would
have been payable as of March 1, 1997, the payment under such
agreement to Mr. Rainville and Mr. Wood would have been
approximately $415,000 and $367,000, respectively.
RELATIONSHIP WITH AFFILIATES
Thermo Electron has adopted a strategy of selling a minority
interest in subsidiary companies to outside investors as an
important tool in its future development. As part of this
strategy, Thermo Electron has created Thermedics Inc., Thermo
Ecotek Corporation, Thermo Fibertek Inc., Thermo Instrument
Systems Inc., Thermo Power Corporation, Thermo TerraTech Inc. and
ThermoTrex Corporation, all of which are publicly traded,
majority subsidiaries of the Corporation; Thermedics Inc. has
created Thermedics Detection Inc., Thermo Cardiosystems Inc. and
Thermo Sentron Inc. as publicly traded, majority-owned
subsidiaries and has acquired the majority interest in a
previously unaffiliated public company, Thermo Voltek Corp.;
Thermo TerraTech Inc. has created Thermo Remediation Inc. as a
publicly traded, majority-owned subsidiary; Thermo Instrument
Systems Inc. has created Thermo BioAnalysis Corporation, Thermo
Optek Corporation, ThermoQuest Corporation and ThermoSpectra
Corporation as publicly traded, majority-owned subsidiaries, and
ThermoTrex Corporation has created ThermoLase Corporation and
Trex Medical Corporation as publicly traded, majority-owned
subsidiaries. From time to time, Thermo Electron and its
subsidiaries will create other majority-owned subsidiaries as
part of its spinout strategy. (The Corporation and such other
majority-owned Thermo Electron subsidiaries are hereinafter
referred to as the "Thermo Subsidiaries.")
Thermo Electron and each of the Thermo Subsidiaries
recognize that the benefits and support that derive from their
affiliation are essential elements of their individual
performance. Accordingly, Thermo Electron and each of the Thermo
Subsidiaries have adopted the Thermo Electron Corporate Charter
(the "Charter") to define the relationships and delineate the
nature of such cooperation among themselves. The purpose of the
Charter is to ensure that (1) all of the companies and their
stockholders are treated consistently and fairly, (2) the scope
and nature of the cooperation among the companies, and each
company's responsibilities, are adequately defined, (3) each
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company has access to the combined resources and financial,
managerial and technological strengths of the others, and (4)
Thermo Electron and the Thermo Subsidiaries, in the aggregate,
are able to obtain the most favorable terms from outside parties.
To achieve these ends, the Charter identifies the general
principles to be followed by the companies, addresses the role
and responsibilities of the management of each company, provides
for the sharing of group resources by the companies and provides
for centralized administrative, banking and credit services to be
performed by Thermo Electron. The services provided by Thermo
Electron include collecting and managing cash generated by
members, coordinating the access of Thermo Electron and the
Thermo Subsidiaries (the "Thermo Group") to external financing
sources, ensuring compliance with external financial covenants
and internal financial policies, assisting in the formulation of
long-range planning and providing other banking and credit
services. Pursuant to the Charter, Thermo Electron may also
provide guarantees of debt or other obligations of the Thermo
Subsidiaries or may obtain external financing at the parent level
for the benefit of the Thermo Subsidiaries. In certain instances,
the Thermo Subsidiaries may provide credit support to, or on
behalf of, the consolidated entity or may obtain financing
directly from external financing sources. Under the Charter,
Thermo Electron is responsible for determining that the Thermo
Group remains in compliance with all covenants imposed by
external financing sources, including covenants related to
borrowings of Thermo Electron or other members of the Thermo
Group, and for apportioning such constraints within the Thermo
Group. In addition, Thermo Electron establishes certain internal
policies and procedures applicable to members of the Thermo
Group. The cost of the services provided by Thermo Electron to
the Thermo Subsidiaries is covered under existing corporate
services agreements between Thermo Electron and each of the
Thermo Subsidiaries.
The Charter presently provides that it shall continue in
effect so long as Thermo Electron and at least one Thermo
Subsidiary participate. The Charter may be amended at any time by
agreement of the participants. Any Thermo Subsidiary, including
the Corporation, can withdraw from participation in the Charter
upon 30 days' prior notice. In addition, Thermo Electron may
terminate a subsidiary's participation in the Charter in the
event the subsidiary ceases to be controlled by Thermo Electron
or ceases to comply with the Charter or the policies and
procedures applicable to the Thermo Group. A withdrawal from the
Charter automatically terminates the corporate services agreement
and tax allocation agreement (if any) in effect between the
withdrawing company and Thermo Electron. The withdrawal from
participation does not terminate outstanding commitments to third
parties made by the withdrawing company, or by Thermo Electron or
other members of the Thermo Group, prior to the withdrawal.
However, a withdrawing company is required to continue to comply
with all policies and procedures applicable to the Thermo Group
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and to provide certain administrative functions mandated by
Thermo Electron so long as the withdrawing company is controlled
by or affiliated with Thermo Electron.
In general, under the corporate services agreements between
Thermo Electron and each of the Thermo Subsidiaries, Thermo
Electron's corporate staff provides each of the Thermo
Subsidiaries with certain administrative services, including
certain legal advice and services, risk management, employee
benefit administration, tax advice and preparation of tax
returns, centralized cash management and financial and other
services. For the fiscal year ended December 28, 1996, the
Corporation assessed each Thermo Subsidiary an annual fee equal
to 1.0% of such subsidiary's revenues for these services. The
fee is reviewed annually and may be changed by mutual agreement
of any Thermo Subsidiary and Thermo Electron. For items such as
employee benefit plans, insurance coverage and other identifiable
costs, Thermo Electron charges each of the Thermo Subsidiaries
based on charges attributable to the respective subsidiary. Each
corporate services agreement automatically renews for successive
one-year terms, unless canceled by the subsidiary upon 30 days'
prior notice. In addition, each corporate services agreement
terminates automatically in the event the subsidiary ceases to be
a member of the Thermo Group or ceases to be a participant in the
Charter. In the event of a termination of a corporate services
agreement, the subsidiary will be required to pay a termination
fee equal to the fee that was paid by such subsidiary for
services under the corporate services agreement for the
nine-month period prior to termination. Following termination,
Thermo Electron may provide certain administrative services on an
as-requested basis by the subsidiary or as required in order to
meet such subsidiary's obligations under Thermo Electron's
policies and procedures. Thermo Electron will charge a subsidiary
a fee equal to the market rate for comparable services if such
services are provided to such subsidiary following termination.
Pursuant to an international distribution agreement,
Thermedics Detection Inc. ("Thermedics Detection"), a subsidiary
of Thermedics Inc., which is, in turn, a subsidiary of the
Corporation, has appointed Arabian Business Machines Co. ("ABM")
as its exclusive distributor of drug-and-explosives detection
products in certain Middle East countries. ABM is a member of
the Olayan Group, and Hutham S. Olayan, a director of the
Corporation, is the president and a director of Olayan America
Corporation and Competrol Real Estate Limited, two other members
of the Olayan Group, which is controlled by Suliman S. Olayan,
Ms. Olayan's father. During 1996, ABM purchased $652,000 of
products from Thermedics Detection pursuant to this distribution
agreement.
In March 1996, Thermedics Detection completed private
placements of an aggregate of 300,000 shares primarily to
outside investors of minority investments in its common stock.
Crescent International Holdings Limited purchased 50,000 shares
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of the common stock of Thermedics Detection in such private
placements at a purchase price of $10.00 per share, the same
price paid by unaffiliated buyers. Crescent International
Holdings Limited is a wholly owned subsidiary of Crescent Holding
GmbH. Crescent Holding GmbH is indirectly controlled by Suliman
S. Olayan, the father of Hutham S. Olayan, a director of the
Corporation.
In December 1996, Metrika Systems Corporation ("Metrika
Systems"), subsidiary of the Corporation, completed a private
placement of 1,935,667 shares primarily to outside investors of
minority investments in its common stock. Dr. John M. Albertine,
a director of the Corporation, and Albertine Enterprises, Inc.,
of which Dr. Albertine is chairman of the board and chief
executive officer, purchased 13,333 and 6,667 shares,
respectively, of the common stock of Metrika Systems at a price
of $7.50 per share, the same price paid by unaffiliated buyers.
Stock Holding Assistance Plans
During 1996, the Human Resources Committee of the
Corporation's Board of Directors (the "Committee") also
established a stock holding policy for executive officers of the
Corporation. The stock holding policy specifies an appropriate
level of ownership of the Corporation's Common Stock as a
multiple of the officer's compensation. For the chief executive
officer, the multiple is one times his base salary and reference
bonus for the calendar year. For all other officers, the
multiple is one times the officer's base salary. The Committee
deemed it appropriate to permit officers to achieve these
ownership levels over a three-year period.
In order to assist officers in complying with the policy,
the Committee also adopted a stock holding assistance plan under
which the Corporation is authorized to make interest-free loans
to officers to enable them to purchase shares of the Common Stock
in the open market. The loans are required to be repaid upon the
earlier of demand or five years from the date of the loan, unless
otherwise authorized by the Committee. No such loans are
currently outstanding under this plan.
Each of the Corporation's publicly traded, majority-owned
subsidiaries have adopted similar stock holding policies and
stock holding assistance plans, which are applicable to their
executive officers. Certain executive officers of the
Corporation are the chief executive officers of these
subsidiaries and are required to comply with the subsidiary's
stock holding policies. Mr. Arvin H. Smith, an executive vice
president of the Corporation, is also the chief executive officer
of Thermo Instrument Systems Inc. Mr. William A. Rainville, a
senior vice president of the Corporation, is also the chief
executive officer of Thermo Fibertek Inc. Mr. John W. Wood,
Jr., a senior vice president of the Corporation, is also the
chief executive officer of Thermedics Inc. In 1996, Mr.
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Rainville received a loan in the principal amount of $118,104
under the Thermo Fibertek Inc. stock holding assistance plan to
purchase 10,000 shares of the common stock of Thermo Fibertek
Inc. Mr. Rainville's loan is payable on the earlier of demand or
five years from the date of the loan, unless otherwise authorized
by the human resources committee of the board of directors of
Thermo Fibertek Inc. None of the other named executive officers
have loans currently outstanding under any subsidiary stock
holding assistance plan.
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