10-Q

FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549

(Mark One)

[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2001

OR

[   ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from __________ to __________

Commission File Number 001-10109

BECKMAN COULTER, INC.
(Exact name of registrant as specified in its charter)

Delaware	95-1040600
(State of Incorporation)	(I.R.S. Employer Identification No.)
4300 N. Harbor Boulevard, Fullerton, California	92834-3100
(Address of principal executive offices)	(Zip Code)

(714) 871-4848
(Registrant’s telephone number including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes [X]   No [   ].

     APPLICABLE ONLY TO CORPORATE ISSUERS:

     Outstanding shares of common stock, $0.10 par value, as of October 26, 2001: 60,946,250 shares.

TABLE OF CONTENTS

		CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
		CONDENSED CONSOLIDATED BALANCE SHEETS
		CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
		NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
	Item 3. Quantitative and Qualitative Disclosures About Market Risk
PART II
	Item 1. Legal Proceedings
	Item 2. Changes In Securities
	Item 3. Defaults Upon Senior Securities
	Item 4. Submission of Matters to a Vote of Security-Holders
	Item 5. Other Information
	Item 6. Exhibits and Reports on Form 8-K
Signatures
EXHIBIT INDEX
Exhibit 3
EX-10.1
EX-10.2
EX-10.3
EX-10.4
EX-10.5
EX-10.6
Exhibit 15

PART I
FINANCIAL INFORMATION
Item 1.	Financial Statements
	Condensed Consolidated Statements of Operations for the three and nine month periods ended September 30, 2001 and 2000
	Condensed Consolidated Balance Sheets as of September 30, 2001 and December 31, 2000
	Condensed Consolidated Statements of Cash Flows for the nine month periods ended September 30, 2001 and 2000
	Notes to Condensed Consolidated Financial Statements
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations
Item 3.	Quantitative and Qualitative Disclosures About Market Risk
PART II
OTHER INFORMATION
Item 1.	Legal Proceedings
Item 2.	Changes In Securities
Item 3.	Defaults Upon Senior Securities
Item 4.	Submission of Matters to a Vote of Security-Holders
Item 5.	Other Information
Item 6.	Exhibits and Reports on Form 8-K

2

BECKMAN COULTER, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in Millions, Except Amounts Per Share and Share Data)
Unaudited

			Three Months Ended						Nine Months Ended
			September 30,						September 30,
			2001			2000			2001			2000
Sales			$	476.6		$	457.8		$	1,405.7		$	1,361.6
Cost of sales				258.8			243.2			753.5			720.5
Gross profit				217.8			214.6			652.2			641.1
Operating costs and expenses:
	Selling, general and administrative			121.2			116.4			352.4			349.0
	Research and development			45.9			43.3			135.4			130.0
		Total operating costs and expenses		167.1			159.7			487.8			479.0
Operating income				50.7			54.9			164.4			162.1
Nonoperating (income) and expense:
	Interest income			(1.9	)		(1.4	)		(6.1	)		(4.9	)
	Interest expense			12.4			17.7			42.8			54.2
	Other, net			(7.6	)		(3.6	)		(7.3	)		(6.8	)
		Total nonoperating expense		2.9			12.7			29.4			42.5
Earnings before income taxes and accounting change				47.8			42.2			135.0			119.6
Income taxes				14.8			13.1			41.8			37.1
Earnings before accounting change				33.0			29.1			93.2			82.5
Cumulative effect of accounting change, net of income taxes of $1.8				—			—			3.1			—
		Net earnings	$	33.0		$	29.1		$	90.1		$	82.5
Basic earnings per share:
	Before accounting change		$	0.54		$	0.49		$	1.54		$	1.40
	Cumulative effect of accounting change			—			—			(0.05	)		—
			$	0.54		$	0.49		$	1.49		$	1.40
Diluted earnings per share:
	Before accounting change		$	0.52		$	0.47		$	1.46		$	1.34
	Cumulative effect of accounting change			—			—			(0.05	)		—
			$	0.52		$	0.47		$	1.41		$	1.34
Weighted average number of shares outstanding (in thousands):
		Basic		60,730			59,256			60,346			58,733
		Diluted		63,953			62,490			63,873			61,517
Dividends declared per share			$	0.085		$	0.080		$	0.255		$	0.240

See accompanying notes to condensed consolidated financial statements.

3

BECKMAN COULTER, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in Millions, Except Amounts per Share)

				September 30,			December 31,
				2001			2000
				Unaudited
Assets
Current assets:
	Cash and equivalents			$	22.0		$	29.6
	Trade and other receivables				522.9			536.7
	Inventories				392.1			332.1
	Other current assets				49.9			29.4
			Total current assets		986.9			927.8
Property, plant and equipment, net					332.6			298.2
Goodwill, less accumulated amortization of $45.2 and $37.2 at September 30, 2001 and December 31, 2000, respectively					329.3			331.7
Other intangibles, less accumulated amortization of $78.6 and $66.1 at September 30, 2001 and December 31, 2000, respectively					369.4			382.7
Other assets					104.5			77.8
			Total assets	$	2,122.7		$	2,018.2
Liabilities and Stockholders’ Equity
Current liabilities:
	Notes payable and current maturities of long-term debt			$	43.4		$	52.1
	Accounts payable, accrued expenses and other liabilities				383.9			390.7
	Income taxes				72.9			58.3
			Total current liabilities		500.2			501.1
Long-term debt, less current maturities					825.2			862.8
Other liabilities					336.2			310.4
			Total liabilities		1,661.6			1,674.3
Stockholders’ equity:
	Preferred stock, $0.10 par value; authorized 10.0 shares; none issued				—			—
	Common stock, $0.10 par value; authorized 150.0 shares; shares issued and outstanding 60.9 and 59.7 at September 30, 2001 and December 31, 2000, respectively				6.1			6.0
	Additional paid-in capital				204.4			170.0
	Retained earnings				300.8			226.3
	Accumulated other comprehensive income (loss):
		Cumulative foreign currency translation adjustment			(51.8	)		(58.4	)
		Derivatives qualifying as hedges			1.6			—
			Total stockholders’ equity		461.1			343.9
			Total liabilities and stockholders’ equity	$	2,122.7		$	2,018.2

See accompanying notes to condensed consolidated financial statements.

4

BECKMAN COULTER, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in Millions)
Unaudited

					Nine Months Ended
					September 30,
					2001			2000
Cash Flows from Operating Activities
	Net earnings				$	90.1		$	82.5
	Adjustments to reconcile net earnings to net cash provided by operating activities:
			Depreciation and amortization			94.6			101.6
			Cumulative effect of accounting change, net of tax			3.1			—
			Net deferred income taxes			(1.9	)		8.2
			Loss (gain) on sale of property, plant and equipment			0.9			(2.9	)
			Changes in assets and liabilities:
				Trade and other receivables		14.1			76.9
				Inventories		(40.7	)		(46.7	)
				Accounts payable, accrued expenses and other liabilities		(18.7	)		(97.0	)
				Income taxes payable		23.6			23.0
				Other		7.0			3.4
				Net cash provided by operating activities		172.1			149.0
Cash Flows from Investing Activities
	Additions to property, plant and equipment					(122.7	)		(110.1	)
	Proceeds from sale of property, plant and equipment					2.1			17.5
	Proceeds from sale of certain clinical chemistry assets					0.7			15.2
	Purchase of investments					—			(5.3	)
	Payment for acquisition					(3.3	)		—
				Net cash used by investing activities		(123.2	)		(82.7	)
Cash Flows from Financing Activities
	Dividends to stockholders					(15.6	)		(14.2	)
	Proceeds from issuance of stock					27.3			27.3
	Proceeds from stock purchase plan					2.5			2.0
	Notes payable reductions, net					(27.0	)		(21.6	)
	Long-term debt reductions					(43.7	)		(72.8	)
				Net cash used by financing activities		(56.5	)		(79.3	)
Effect of exchange rates on cash and equivalents						—			(3.1	)
Decrease in cash and equivalents						(7.6	)		(16.1	)
Cash and equivalents — beginning of period						29.6			34.4
Cash and equivalents — end of period					$	22.0		$	18.3
Supplemental Disclosures of Cash Flow Information
	Cash paid during the period for:
		Interest			$	44.2		$	52.4
		Income taxes			$	25.3		$	21.1
Noncash investing and financing activities:
	Purchase of equipment under capital lease				$	3.7		$	3.1

See accompanying notes to condensed consolidated financial statements.

5

BECKMAN COULTER, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2001
Unaudited

1. Report by Management

Beckman Coulter, Inc. and its wholly owned subsidiaries (the “Company”) prepared the accompanying Condensed Consolidated Financial Statements following the requirements of the Securities and Exchange Commission for interim reporting. As permitted under those rules, certain footnotes or other financial information normally required by accounting principles generally accepted in the United States of America have been condensed or omitted.

The financial statements include all normal and recurring adjustments that the Company considers necessary for the fair presentation of its financial position and operating results. To obtain a more detailed understanding of the Company’s results, these Condensed Consolidated Financial Statements should be read in conjunction with the consolidated financial statements and notes in the Company’s annual report on Form 10-K for the year ended December 31, 2000.

Revenues, expenses, assets and liabilities can vary between the quarters of the year. Therefore, the results and trends in these interim financial statements may not be the same as those for the full year.

2. Recent Accounting Developments

Derivatives and Hedging Activities

Effective January 1, 2001, the Company adopted Statement of Financial Accounting Standards (“SFAS”) No. 133, “Accounting for Derivative Instruments and Hedging Activities” (“SFAS 133”). The provisions of the statement require the recognition of all derivatives as either assets or liabilities in the consolidated balance sheet and the measurement of those instruments at fair value. Changes in the fair value of derivatives designated as fair value hedges and of the hedged item attributable to the hedged risk are recognized in other nonoperating (income)/expense. If the derivative is designated as a cash flow hedge, the effective portion of the fair value of the derivative is recorded in accumulated other comprehensive income (i.e., derivatives qualifying as hedges) and is subsequently recognized in other nonoperating (income)/expense when the hedged future foreign currency cash flows are received. Ineffective portions of changes in the fair value of cash flow hedges are recognized in other nonoperating (income)/expense. If the derivative is designated as hedging the foreign currency exposure of a net investment in a foreign operation (“net investment hedge”), the effective portion of the change in the fair value of the derivative is recorded in accumulated other comprehensive income (i.e., cumulative foreign currency translation adjustment). Prior to the date of adoption of SFAS 133, the Company’s existing foreign currency contracts were characterized as fair value hedges. The effect of the re-characterization to cash flow hedges on January 1, 2001 was not material. The adoption of SFAS 133 resulted in a cumulative after-tax reduction to income of $3.1 million (net of income taxes of $1.8 million) during the quarter ended March 31, 2001.

Transfers of Financial Assets and Extinguishments of Liabilities

Effective April 1, 2001, the Company adopted SFAS 140, “Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities”. This statement replaces SFAS 125 and revises the accounting for securitizations and other transfers of financial assets. The adoption of SFAS 140 did not have a material impact on the Company’s financial position or results of operations.

6

Goodwill and Other Intangible Assets

SFAS 142 “Goodwill and Other Intangible Assets” requires that goodwill and other intangible assets that have indefinite useful lives not be amortized but rather be tested at least annually for impairment. The Company is required to adopt SFAS 142 on January 1, 2002. However, goodwill and intangible assets acquired after June 30, 2001 are subject to the amortization provisions of SFAS 142. The Company estimates that the adoption of SFAS 142 will decrease amortization expense in 2002 by approximately $16 million (net of income taxes of $4 million).

Accounting for Asset Retirement Obligations

SFAS 143 “Accounting for Asset Retirement Obligations” addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. The Company is required to adopt SFAS 143 on January 1, 2003. The Company is currently evaluating the impact of SFAS 143 on its consolidated financial statements and results of operations.

3. Derivatives

The Company uses derivative financial instruments to hedge foreign currency and interest rate exposures. The Company’s objectives for holding derivatives are to minimize the risks using the most effective methods to eliminate or reduce the impacts of these exposures. The Company does not speculate in derivative instruments in order to profit from foreign currency exchange or interest rate fluctuations; nor does the Company enter into trades for which there are no underlying exposures. The following discusses in more detail the Company’s foreign currency and interest rate exposures and related derivative instruments.

Foreign Currency

The Company manufactures its products principally in the United States, but generates approximately 45% of its revenues from sales made outside the United States by its international subsidiaries. Sales generated by the international subsidiaries generally are denominated in the subsidiary’s local currency, thereby exposing the Company to the risk of foreign currency fluctuations. In order to mitigate the impact of changes in foreign currency exchange rates, the Company uses derivative financial instruments (or “foreign currency contracts”) to hedge the foreign currency exposure resulting from cash flows attributable to anticipated intercompany transactions. These foreign currency contracts include forward and option contracts and are designated as cash flow hedges.

The Company uses foreign currency swap contracts to hedge loans between subsidiaries. These foreign currency swap contracts are designated as fair value hedges.

7

During the three months ended September 30, 2001, the Company entered into a foreign currency swap contract to hedge a net investment in a foreign operation. This foreign currency swap contract is designated as a net investment hedge. At September 30, 2001, a $1.0 million loss associated with this foreign currency swap contract was included in accumulated other comprehensive income (i.e., cumulative foreign currency translation adjustment).

For options designated as cash flow hedges, changes in time value are excluded from the assessment of hedge effectiveness. During the three and nine months ended September 30, 2001, the Company recognized zero and $1.6 million, respectively, of hedge ineffectiveness associated with its cash flow hedges. No hedge ineffectiveness was recognized on the Company’s fair value hedges during the three and nine months ended September 30, 2001. No fair value or cash flow hedges were discontinued for the nine months ended September 30, 2001.

Derivative gains and losses included in accumulated other comprehensive income are reclassified into other nonoperating (income)/expense at the time the hedged future foreign currency cash flows are received. The Company estimates that $0.9 million of the $1.6 million unrealized gain included in accumulated other comprehensive income at September 30, 2001 will be reclassified to other nonoperating (income)/expense within the next twelve months. The actual amounts that will be reclassified to earnings over the next twelve months will vary from this amount as a result of changes in market conditions.

Interest Rate

The Company uses interest rate derivative contracts on certain borrowing transactions to hedge fluctuating interest rates. Interest differentials paid or received under these contracts are recognized as adjustments to the effective yield of the underlying financial instruments hedged.

In March 1998, the Company entered into reverse interest rate swap contracts totaling $300.0 million associated with the issuance of the $400.0 million Senior Notes. Pursuant to the reverse interest rate swap agreements, as amended, the Company receives an average fixed interest rate of 6.2% and pays a floating interest rate (3.5% at September 30, 2001). These reverse interest rate swaps are designated as fair value hedges and are deemed perfectly effective pursuant to SFAS 133 as all significant terms of the Senior Notes and the reverse interest rate swap contracts match. At September 30, 2001, the fair value of the reverse interest rate swaps was $20.0 million and is included in other assets. An offsetting $20.0 million credit is included in long-term debt as a fair value adjustment to the Senior Notes.

8

4. Comprehensive Income

The Company’s components of comprehensive income include net earnings, foreign currency adjustments and derivatives qualifying as hedges, as follows (amounts in millions):

			Three Months Ended September 30,					Nine Months Ended September 30,
			2001			2000		2001			2000
Net earnings			$	33.0		$	29.1	$	90.1		$	82.5
	Foreign currency translation adjustment			9.0			1.5		6.6			(24.6	)
	Derivatives qualifying as hedges:
		Net derivative (loss) gain		(5.9	)		—		6.0			—
		Reclassifications to income		(2.7	)		—		(4.4	)		—
				(8.6	)		—		1.6			—
Comprehensive income			$	33.4		$	30.6	$	98.3		$	57.9

9

5. Earnings Per Share

The following is a reconciliation of the numerators and denominators used in computing basic and diluted earnings per share (“EPS”) before accounting change (amounts in millions, except amounts per share):

		Three Months Ended September 30,
		2001							2000
						Per							Per
		Net				Share			Net				Share
		Earnings		Shares		Amount			Earnings		Shares		Amount
Basic EPS:
	Net earnings	$	33.0		60.730	$	0.54		$	29.1		59.256	$	0.49
	Effect of dilutive stock options		—		3.223		(0.02	)		—		3.234		(0.02	)
Diluted EPS:
	Net earnings	$	33.0		63.953	$	0.52		$	29.1		62.490	$	0.47

		Nine Months Ended September 30,
		2001							2000
		Earnings
		Before				Per							Per
		Accounting				Share			Net				Share
		Change		Shares		Amount			Earnings		Shares		Amount
Basic EPS:
	Net earnings	$	93.2		60.346	$	1.54		$	82.5		58.733	$	1.40
	Effect of dilutive stock options		—		3.527		(0.08	)		—		2.784		(0.06	)
Diluted EPS:
	Net earnings	$	93.2		63.873	$	1.46		$	82.5		61.517	$	1.34

For the three and nine months ended September 30, 2001 and for the three months ended September 30, 2000, there were no shares relating to the possible exercise of outstanding stock options excluded from the computation of diluted EPS. For the nine months ended September 30, 2000, there were 0.1 million shares relating to the possible exercise of outstanding stock options that were not included in the computation of diluted EPS as their effect would have been anti-dilutive.

6. Sale of Receivables

During the nine months ended September 30, 2001, the Company sold certain sales-type lease receivables as part of the Company’s plan to reduce debt. The net book value of financial assets sold was $44.3 million for which the Company received $47.5 million in cash proceeds. During the nine months ended September 30, 2000, the Company sold similar assets with a net book value of $61.6 million for which the Company received $61.9 million. The transactions were accounted for as asset sales and as a result the related receivables have been excluded from the accompanying Condensed Consolidated Balance Sheets. The sales are subject to certain recourse and servicing provisions, and, as such, the Company has established reserves for these probable liabilities.

10

7. Inventories

Inventories consisted of the following (amounts in millions):

	September 30, 2001		December 31, 2000
Finished products	$	256.0	$	214.0
Raw materials, parts and assemblies		109.3		95.7
Work in process		26.8		22.4
	$	392.1	$	332.1

8. Contingencies

In December 1999, Streck Laboratories, Inc. (“Streck”) sued Beckman Coulter and Coulter Corporation in the United States District Court for the District of Nebraska. Streck alleges that certain hematology control products sold by Beckman Coulter and/or Coulter Corporation infringe each of six patents owned by Streck, and seeks injunctive relief, damages, attorney fees and costs. The Company, on behalf of itself and Coulter Corporation, denied liability. The litigation, previously stayed pending settlement discussions, has resumed as a result of the inability of the parties to reach a settlement. The trial is currently scheduled for June 2002. The Company believes that there is no reasonable basis to conclude that this litigation could lead to an outcome that would have a material adverse effect on its consolidated results of operations, financial position or liquidity.

In addition to the above matter, the Company is involved in a number of other lawsuits, which the Company considers ordinary and routine in view of its size and the nature of its business. The Company does not believe that any ultimate liability resulting from any such lawsuits will have a material adverse effect on its consolidated results of operations, financial position or liquidity.

9. Business Segment Information

The Company is engaged primarily in the design, manufacture and sale of laboratory instrument systems and related products. The Company has two reportable segments: (1) clinical diagnostics and (2) life science research. The clinical diagnostics segment encompasses diagnostic applications, principally in hospital and private laboratories. The life science research segment includes life sciences and drug discovery applications in universities, medical schools, and pharmaceutical and biotechnology companies. All corporate activities including financing transactions are captured in a central services “Center”, which is reflected in the table below. The Company evaluates performance based on profit or loss from operations. Although primarily operating in the same industry, reportable segments are managed separately, since each business requires different marketing strategies and has different customers.

11

During the quarter ended March 31, 2001, the Company announced its intention to form three divisions aligned with the biomedical testing continuum: Life Science Research, Specialty Testing and Clinical Diagnostics. Implementation is expected in 2002.

				Three Months Ended						Nine Months Ended
				September 30,						September 30,
				2001			2000			2001			2000
				(amounts in millions)
Net sales
	Clinical diagnostics			$	364.1		$	358.8		$	1,096.5		$	1,078.9
	Life science research				112.5			99.0			309.2			282.7
	Center				—			—			—			—
		Consolidated		$	476.6		$	457.8		$	1,405.7		$	1,361.6
Operating income (loss)
	Clinical diagnostics			$	52.0		$	53.2		$	170.3		$	174.1
	Life science research				21.0			17.0			51.9			39.8
	Center				(22.3	)		(15.3	)		(57.8	)		(51.8	)
		Consolidated		$	50.7		$	54.9		$	164.4		$	162.1
Interest income
	Clinical diagnostics			$	(0.8	)	$	(0.6	)	$	(2.6	)	$	(1.3	)
	Life science research				—			—			—			—
	Center				(1.1	)		(0.8	)		(3.5	)		(3.6	)
		Consolidated		$	(1.9	)	$	(1.4	)	$	(6.1	)	$	(4.9	)
Interest expense
	Clinical diagnostics			$	—		$	—		$	—		$	—
	Life science research				—			—			—			—
	Center				12.4			17.7			42.8			54.2
		Consolidated		$	12.4		$	17.7		$	42.8		$	54.2
Sales to external customers
	Americas			$	308.5		$	291.6		$	902.0		$	840.1
	Europe				113.2			112.8			340.1			357.2
	Asia				54.9			53.4			163.6			164.3
			Consolidated	$	476.6		$	457.8		$	1,405.7		$	1,361.6

				September 30, 2001		December 31, 2000
Total assets
	Clinical diagnostics			$	1,405.6	$	1,356.8
	Life science research				194.7		201.7
	Center				522.4		459.7
		Consolidated		$	2,122.7	$	2,018.2
Long-lived assets
	Americas			$	1,032.5	$	997.7
	Europe				85.1		72.8
	Asia				18.2		19.9
			Consolidated	$	1,135.8	$	1,090.4

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10. Stockholders’ Equity

During the nine months ended September 30, 2001, we recorded a $7.2 million increase to additional paid-in capital with an offsetting decrease to income taxes payable as a result of the tax benefit we receive from employees exercising non-qualified stock options.

11. Debt Financing and Guarantor Subsidiaries

In March 1998, the Company issued $160.0 million of 7.10% Senior Notes due 2003 and $240.0 million of 7.45% Senior Notes due 2008 (the “Offering”). In connection with the Offering, certain of the Company’s subsidiaries (the “Guarantor Subsidiaries”) jointly, fully, severally and unconditionally guaranteed such notes. Pursuant to Securities and Exchange Commission regulations, certain condensed financial information about the Parent, Guarantor Subsidiaries and Non-Guarantor Subsidiaries is required to be disclosed. The following provides this required financial information. Note that the Company used the equity method of accounting for its investments in subsidiaries and the Guarantor Subsidiaries’ investments in Non-Guarantor Subsidiaries.

13

Condensed Consolidated Statement of Operations
Three Months Ended September 30, 2001

									Non-
						Guarantor			Guarantor
			Parent			Subsidiaries			Subsidiaries			Eliminations			Consolidated
Sales			$	372.8		$	71.7		$	254.0		$	(221.9	)	$	476.6
Operating costs and expenses:
	Cost of sales			241.6			52.6			186.5			(221.9	)		258.8
	Selling, general and administrative			66.9			11.0			43.3			—			121.2
	Research and development			27.9			16.9			1.1			—			45.9
		Operating income (loss)		36.4			(8.8	)		23.1			—			50.7
Nonoperating (income) expense				(7.6	)		3.6			(1.3	)		8.2			2.9
Earnings (loss) before income taxes				44.0			(12.4	)		24.4			(8.2	)		47.8
Income tax expense (benefit)				11.1			(3.8	)		7.6			(0.1	)		14.8
		Net earnings (loss)	$	32.9		$	(8.6	)	$	16.8		$	(8.1	)	$	33.0

Condensed Consolidated Statement of Operations
Three Months Ended September 30, 2000

								Non-
					Guarantor			Guarantor
			Parent		Subsidiaries			Subsidiaries			Eliminations			Consolidated
Sales			$	353.2	$	67.1		$	227.7		$	(190.2	)	$	457.8
Operating costs and expenses:
	Cost of sales			219.0		49.8			166.0			(191.6	)		243.2
	Selling, general and administrative			61.7		11.2			43.5			—			116.4
	Research and development			25.1		17.2			1.0			—			43.3
		Operating income (loss)		47.4		(11.1	)		17.2			1.4			54.9
Nonoperating expense (income)				8.0		3.3			(1.5	)		2.9			12.7
Earnings (loss) before income taxes				39.4		(14.4	)		18.7			(1.5	)		42.2
Income tax expense (benefit)				11.3		(6.2	)		7.5			0.5			13.1
		Net earnings (loss)	$	28.1	$	(8.2	)	$	11.2		$	(2.0	)	$	29.1

14

Condensed Consolidated Statement of Operations
Nine Months Ended September 30, 2001

									Non-
						Guarantor			Guarantor
			Parent			Subsidiaries			Subsidiaries			Eliminations			Consolidated
Sales			$	1,099.4		$	217.6		$	722.9		$	(634.2	)	$	1,405.7
Operating costs and expenses:
	Cost of sales			699.6			159.1			528.7			(633.9	)		753.5
	Selling, general and administrative			200.6			31.7			120.1			—			352.4
	Research and development			81.9			50.3			3.2			—			135.4
		Operating income (loss)		117.3			(23.5	)		70.9			(0.3	)		164.4
Nonoperating (income) expense				(5.8	)		10.6			(1.8	)		26.4			29.4
Earnings (loss) before income taxes and accounting change				123.1			(34.1	)		72.7			(26.7	)		135.0
Income tax expense (benefit)				29.8			(10.5	)		22.5			—			41.8
Earnings (loss) before accounting change				93.3			(23.6	)		50.2			(26.7	)		93.2
Cumulative effect of accounting change net of taxes				3.1			—			—			—			3.1
		Net earnings (loss)	$	90.2		$	(23.6	)	$	50.2		$	(26.7	)	$	90.1

Condensed Consolidated Statement of Operations
Nine Months Ended September 30, 2000

								Non-
					Guarantor			Guarantor
			Parent		Subsidiaries			Subsidiaries			Eliminations			Consolidated
Sales			$	1,033.3	$	226.8		$	705.5		$	(604.0	)	$	1,361.6
Operating costs and expenses:
	Cost of sales			646.9		163.6			517.2			(607.2	)		720.5
	Selling, general and administrative			188.3		34.0			126.7			—			349.0
	Research and development			75.1		51.0			3.9			—			130.0
		Operating income (loss)		123.0		(21.8	)		57.7			3.2			162.1
Nonoperating expense (income)				15.8		10.0			(3.7	)		20.4			42.5
Earnings (loss) before income taxes				107.2		(31.8	)		61.4			(17.2	)		119.6
Income tax expense (benefit)				26.9		(9.8	)		19.0			1.0			37.1
		Net earnings (loss)	$	80.3	$	(22.0	)	$	42.4		$	(18.2	)	$	82.5

15

Condensed Consolidated Balance Sheet
September 30, 2001

									Non-
						Guarantor			Guarantor
			Parent			Subsidiaries			Subsidiaries		Eliminations			Consolidated
Assets:
	Cash and equivalents		$	(45.4	)	$	(0.4	)	$	67.8	$	—		$	22.0
	Trade and other receivables			261.0			1.4			260.5		—			522.9
	Inventories			247.5			48.9			131.4		(35.7	)		392.1
	Other current assets			969.7			1,343.9			78.6		(2,342.3	)		49.9
		Total current assets		1,432.8			1,393.8			538.3		(2,378.0	)		986.9
	Property, plant and equipment, net			202.7			89.2			97.1		(56.4	)		332.6
	Goodwill, net			8.7			315.6			5.0		—			329.3
	Other intangibles, net			26.7			338.2			4.5		—			369.4
	Other assets			1,091.8			25.5			344.1		(1,356.9	)		104.5
		Total assets	$	2,762.7		$	2,162.3		$	989.0	$	(3,791.3	)	$	2,122.7
Liabilities:
	Notes payable and current maturities of long-term debt		$	3.8		$	—		$	39.6	$	—		$	43.4
	Accounts payable and accrued expenses			238.8			30.5			114.6		—			383.9
	Other current liabilities			918.0			854.7			119.2		(1,819.0	)		72.9
		Total current liabilities		1,160.6			885.2			273.4		(1,819.0	)		500.2
	Long-term debt, less current maturities			793.3			—			31.9		—			825.2
	Other liabilities			353.9			599.9			18.5		(636.1	)		336.2
		Total liabilities		2,307.8			1,485.1			323.8		(2,455.1	)		1,661.6
Total stockholders’ equity				454.9			677.2			665.2		(1,336.2	)		461.1
		Total liabilities and stockholders’ equity	$	2,762.7		$	2,162.3		$	989.0	$	(3,791.3	)	$	2,122.7

16

Condensed Consolidated Balance Sheet
December 31, 2000

									Non-
						Guarantor			Guarantor
			Parent			Subsidiaries			Subsidiaries		Eliminations			Consolidated
Assets:
	Cash and equivalents		$	(28.3	)	$	(4.3	)	$	62.2	$	—		$	29.6
	Trade and other receivables			258.6			3.7			274.4		—			536.7
	Inventories			221.7			38.2			103.3		(31.1	)		332.1
	Other current assets			814.1			1,028.4			51.7		(1,864.8	)		29.4
		Total current assets		1,266.1			1,066.0			491.6		(1,895.9	)		927.8
	Property, plant and equipment, net			172.1			86.3			109.9		(70.1	)		298.2
	Goodwill, net			10.7			321.0			—		—			331.7
	Other intangibles, net			26.9			350.2			5.6		—			382.7
	Other assets			1,308.2			22.3			300.8		(1,553.5	)		77.8
		Total assets	$	2,784.0		$	1,845.8		$	907.9	$	(3,519.5	)	$	2,018.2
Liabilities:
	Notes payable and current maturities of long-term debt		$	32.8		$	0.1		$	19.2	$	—		$	52.1
	Accounts payable and accrued expenses			301.1			24.6			76.7		(11.7	)		390.7
	Other current liabilities			832.1			539.3			99.4		(1,412.5	)		58.3
		Total current liabilities		1,166.0			564.0			195.3		(1,424.2	)		501.1
	Long-term debt, less current maturities			806.9			—			55.9		—			862.8
	Other liabilities			473.5			581.0			41.7		(785.8	)		310.4
		Total liabilities		2,446.4			1,145.0			292.9		(2,210.0	)		1,674.3
Total stockholders’ equity				337.6			700.8			615.0		(1,309.5	)		343.9
		Total liabilities and stockholders’ equity	$	2,784.0		$	1,845.8		$	907.9	$	(3,519.5	)	$	2,018.2

17

Condensed Consolidated Statement of Cash Flows
Nine Months Ended September 30, 2001

									Non-
						Guarantor			Guarantor
			Parent			Subsidiaries			Subsidiaries			Consolidated
Net cash provided by operating activities			$	76.8		$	6.2		$	89.1		$	172.1
Cash flows from investing activities:
	Additions to property, plant and equipment			(71.9	)		(7.8	)		(43.0	)		(122.7	)
	Proceeds from sale of property, plant and equipment			—			0.5			1.6			2.1
	Proceeds from sale of certain clinical chemistry assets			—			—			0.7			0.7
	Payment for acquisition			(3.3	)		—			—			(3.3	)
		Net cash used by investing activities		(75.2	)		(7.3	)		(40.7	)		(123.2	)
Cash flows from financing activities:
	Dividends to stockholders			(15.6	)		—			—			(15.6	)
	Proceeds from issuance of stock			27.3			—			—			27.3
	Proceeds from stock purchase plan			2.5			—			—			2.5
	Notes payable (reductions) borrowings			(28.9	)		—			1.9			(27.0	)
	Net intercompany borrowings (reductions)			9.5			5.0			(14.5	)		—
	Long-term debt reductions			(13.5	)		—			(30.2	)		(43.7	)
		Net cash (used) provided by financing activities		(18.7	)		5.0			(42.8	)		(56.5	)
(Decrease) increase in cash and equivalents				(17.1	)		3.9			5.6			(7.6	)
Cash and equivalents — beginning of period				(28.3	)		(4.3	)		62.2			29.6
Cash and equivalents — end of period			$	(45.4	)	$	(0.4	)	$	67.8		$	22.0

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Condensed Consolidated Statement of Cash Flows
Nine Months Ended September 30, 2000

									Non-
						Guarantor			Guarantor
			Parent			Subsidiaries			Subsidiaries			Consolidated
Net cash provided (used) by operating activities			$	44.4		$	(6.5	)	$	111.1		$	149.0
Cash flows from investing activities:
	Additions to property, plant and equipment			(51.4	)		(7.5	)		(51.2	)		(110.1	)
	Proceeds from sale of property, plant and equipment			—			2.3			15.2			17.5
	Proceeds from sale of certain clinical chemistry assets			—			—			15.2			15.2
	Investments			(4.8	)		—			(0.5	)		(5.3	)
		Net cash used by investing activities		(56.2	)		(5.2	)		(21.3	)		(82.7	)
Cash flows from financing activities:
	Dividends to stockholders			(14.2	)		—			—			(14.2	)
	Proceeds from issuance of stock			27.3			—			—			27.3
	Proceeds from stock purchase plan			2.0			—			—			2.0
	Notes payable reductions			(0.1	)		(0.8	)		(20.7	)		(21.6	)
	Net intercompany borrowings (reductions)			20.7			5.0			(25.7	)		—
	Long-term debt reductions			(60.8	)		(0.1	)		(11.9	)		(72.8	)
		Net cash (used) provided by financing activities		(25.1	)		4.1			(58.3	)		(79.3	)
Effect of exchange rates on cash and equivalents				—			—			(3.1	)		(3.1	)
(Decrease) increase in cash and equivalents				(36.9	)		(7.6	)		28.4			(16.1	)
Cash and equivalents — beginning of period				(5.3	)		3.7			36.0			34.4
Cash and equivalents — end of period			$	(42.2	)	$	(3.9	)	$	64.4		$	18.3

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

Beckman Coulter simplifies and automates laboratory processes used in all phases of the battle against disease. We design, manufacture and market systems which consist of instruments, chemistries, software and supplies that meet a variety of laboratory needs. Our products are used in a range of applications, from instruments used for pioneering medical research, clinical trials and drug discovery to diagnostic tools found in hospitals and physicians’ offices. We compete in market segments that totaled approximately $31 billion in annual sales worldwide in 2000, and we currently have products which address approximately half of that market.

Our product lines cover virtually all blood tests routinely performed in hospital laboratories and include a range of systems for medical and pharmaceutical research. We offer a wide range of instrument systems and related products, including reagents, consumables, accessories and support services in both the clinical diagnostics and life science research segments. We have more than 175,000 systems operating in laboratories around the world, with approximately two-thirds of annual revenues coming from after-market customer purchases of operating supplies, chemistry kits and service. We market our products in approximately 130 countries, generating approximately 45% of revenues outside the United States. Our strategy is to maintain our position as a leading provider of laboratory systems. To this end, we achieved the following significant milestones during the quarter ended September 30, 2001:

• Shipped the Access® 2 Immunoassay System, a second-generation analyzer for cardiac, cancer, anemia, thyroid, fertility and infectious disease testing with networking and automation capabilities.

• Acquired Anthos Labtec Instruments, G.m.b.H., an Austria-based manufacturer of microtiter plate readers, washers and shakers commonly used with liquid handling systems in life science research and pre-clinical markets.

• Introduced three new, ready-to-use, MHC Tetramer reagents for Cytomegalovirus (CMV), Epstein-Barr Virus (EBV) and Influenza.

• Formed strategic alliance between our Immunomics Operations and EpiVax, Inc., to discover, develop and commercialize products and services to accelerate the identification of the biological sequences with the greatest potential for activating the immune system.

• Moved and reconfigured cellular analysis instrument manufacturing, completing the last integration activity from the Coulter Corporation acquisition.

• Shipped the COULTER® LH750 hematology system, a random access, blood counting analyzer for high-volume testing environments, such as mid-sized to large hospitals and private laboratories.

Results of Operations

Sales were $476.6 million during the quarter ended September 30, 2001, an increase of 4.1% compared to $457.8 million in the same period in the prior year. On a constant currency basis, sales increased 6.8% in the third quarter of 2001. Sales were $1,405.7 million during the nine months ended September 30, 2001, an increase of 3.2% compared to $1,361.6 million in the same period in the prior year. Sales on a constant currency basis, and

20

excluding a one-time asset sale during the quarter ended March 31, 2000 (see below for discussion), increased 7.2% during the nine months ended September 30, 2001.

The following provides key product and geographical sales information (amounts in millions):

KEY PRODUCT SALES

			Three Months Ended								Nine Months Ended
			September 30, 2001								September 30, 2001
								Constant								Constant
					Reported			Currency					Reported			Currency
			$		Growth %			Growth %			$		Growth %*			Growth %*
Routine Chemistry			$	130.9		1.7			3.9		$	399.0		6.3			8.6
Immunodiagnostics				94.9		10.3			12.2			273.1		8.6			10.7
	Total Chemistry			225.8		5.2			7.2			672.1		7.3			9.4
Hematology				91.8		(5.4	)		(2.9	)		279.2		(4.2	)		(1.7	)
Cytometry				37.9		1.3			5.1			118.9		1.9			5.6
	Total Cellular Analysis			129.7		(3.5	)		(0.7	)		398.1		(2.5	)		0.4
Particle Characterization				8.6		(11.3	)		(7.2	)		26.3		(4.7	)		(1.1	)
	Total Clinical Diagnostics			364.1		1.5			3.9			1,096.5		3.2			5.7
Robotic Auto./Genetic Analysis				43.6		38.9			43.3			107.5		32.1			36.7
Centrifuge/Analytical Systems				68.9		1.9			5.2			201.7		0.2			3.5
	Total Life Science Research			112.5		13.6			17.3			309.2		9.4			13.1
		Total Beckman Coulter	$	476.6		4.1			6.8		$	1,405.7		4.5			7.2

GEOGRAPHICAL SALES

			Three Months Ended							Nine Months Ended
			September 30, 2001							September 30, 2001
								Constant							Constant
					Reported			Currency				Reported			Currency
			$		Growth %			Growth %		$		Growth %*			Growth %*
Clinical Diagnostics
	Americas		$	237.0		3.6			3.6	$	714.0		6.5			6.7
	Europe			87.8		(1.6	)		4.5		268.6		(1.0	)		5.1
	Asia			39.3		(3.9	)		3.9		113.9		(5.6	)		1.4
		Total Clinical Diagnostics		364.1		1.5			3.9		1,096.5		3.2			5.7
Life Science Research
	Americas			71.5		13.7			13.8		188.0		10.7			11.0
	Europe			25.4		7.6			15.3		71.5		3.2			10.7
	Asia			15.6		24.8			38.4		49.7		14.0			24.8
		Total Life Science Research		112.5		13.6			17.3		309.2		9.4			13.1
Total Beckman Coulter
	Americas			308.5		5.8			5.8		902.0		7.4			7.6
	Europe			113.2		0.4			6.7		340.1		(0.1	)		6.3
	Asia			54.9		2.8			12.0		163.6		(0.4	)		7.6
		Total Beckman Coulter	$	476.6		4.1			6.8	$	1,405.7		4.5			7.2

* Percentages have been adjusted to exclude the one-time $16.6 million sale of clinical chemistry assets in Spain to a third party distributor during the quarter ended March 31, 2000.

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The strongest performing product lines during the quarter and nine month periods ended September 30, 2001 were immunodiagnostics and robotic automation/genetic analysis. The combination of our new Access® 2 Immunoassay System and our newly-cleared Troponin I cardiac test increased immunodiagnostics sales 12.2% in constant currency in the quarter ended September 30, 2001. Immunodiagnostics sales increased 10.7% in constant currency for the nine months ended September 30, 2001 due to the aforementioned items and increases in other Access® immunoassay product sales. Robotic automation/genetic analysis sales grew 43.3% and 36.7% in constant currency for the quarter and nine month periods ended September 30, 2001, respectively, fueled by sales of the Biomek® FX laboratory automation workstation. Hematology, particularly in the high-volume laboratory market, was our weakest performing product line, which decreased 2.9% and 1.7% in constant currency for the three and nine month periods ended September 30, 2001, respectively.

On a geographical basis, sales in the Americas increased 5.8% in the third quarter of 2001 as compared to the same period in the prior year. In the Americas, particularly the United States, the quarterly sales cycle was disrupted for nearly two weeks subsequent to the tragic events of September 11. As a result, several orders, consisting primarily of routine chemistry and hematology systems, slipped into the fourth quarter of 2001. In constant currency, sales in Europe and Asia grew 6.7% and 12.0%, respectively, in the third quarter of 2001 as compared to the same period in the prior year. The improvement was led by sales in Life Science Research of robotic automation/genetic analysis systems. For the nine months ended September 30, 2001, constant currency sales in the Americas, Europe and Asia were 7.6%, 6.3% and 7.6%, respectively, as compared to the same period in the prior year.

Gross profit as a percentage of sales (“gross margin”) in the third quarter of 2001 was 45.7%, 1.2 percentage points lower than the same period in the prior year. The decrease in gross margin is mainly due to the effects of currency fluctuations relative to the U.S. dollar (0.7 percentage point impact) and a slightly higher mix of instruments to after-market sales of supplies, chemistry kits and reagents (0.8 percentage point impact). Gross margin for the nine months ended September 30, 2001 was 46.4% (47.1% in constant currency), 0.7 percentage points lower than the same period in the prior year.

Selling, general and administrative expenses (“SG&A”) as a percentage of sales was 25.4% in the third quarter of 2001, consistent with the same period in the prior year. For the nine months ended September 30, 2001, SG&A as a percentage of sales was 25.1%, 0.5 percentage points lower than in the same period in the prior year. The decrease in SG&A as a percentage of sales during this period is primarily due to a $3.8 million reversal of an accrual associated with a cross-licensing agreement during the quarter ended March 31, 2001, continued expense control and the fixed nature of certain of our SG&A expenses. Excluding the aforementioned accrual reversal, SG&A as a percentage of sales would have been 25.3% for the nine months ended September 30, 2001.

Research and development (“R&D”) expenses increased $2.6 million to $45.9 million in the third quarter of 2001 from $43.3 million in the third quarter of 2000. R&D increased $5.4 million to $135.4 million for the nine months ended September 30, 2001 from $130.0 million for the same period in the prior year. The increases are primarily due to increased R&D expenses associated with our Immunomics operation. R&D as a percentage of sales for the three and nine month periods ended September 30, 2001 was 9.6% as compared to 9.5% for the three and nine month periods ended September 30, 2000.

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Interest expense decreased $5.3 million to $12.4 million in the third quarter of 2001 from $17.7 million in the third quarter of 2000. Interest expense decreased $11.4 million to $42.8 million for the nine months ended September 30, 2001 from $54.2 million in the prior year. The decreases from the prior year periods are due to lower debt levels and lower interest rates on the variable rate portion of our borrowings.

Other nonoperating (income) expense was $(7.6) million for the quarter ended September 30, 2001, consisting primarily of foreign currency related activities of $(5.1) million and a gain on the sale of certain sales-type lease receivables of $(1.1) million (see Note 6 “Sale of Receivables”). For the nine months ended September 30, 2001, other nonoperating (income) expense was $(7.3) million, primarily consisting of the following:

• a write-down of $4.7 million for an equity investment in point-of-care testing during the quarter ended March 31, 2001;

• foreign currency related activities of $(8.5) million; and

• gains on the sales of certain sales-type lease receivables of $(2.5) million (see Note 6 “Sale of Receivables”).

Other nonoperating (income) expense was $(3.6) million for the quarter ended September 30, 2000 and primarily consisted of foreign currency related activities of $(3.0) million and a gain on the sale of a facility in Australia of $(1.2) million. For the nine months ended September 30, 2000, other nonoperating (income) expense was $(6.8) million and primarily consisted of foreign currency related activities of $(4.3) million, a gain on the sale of the facility in Australia of $(1.2) million and a gain on the sale of a facility in Japan of $(1.7) million.

Earnings were $33.0 million or $0.52 per diluted share for the third quarter of 2001 compared to $29.1 million or $0.47 per diluted share for the third quarter of 2000. Earnings before the accounting change associated with the adoption of SFAS No. 133 (see Note 2 “Recent Accounting Developments” for further discussion) for the nine months ended September 30, 2001 were $93.2 million or $1.46 per diluted share compared to $82.5 million or $1.34 per diluted share for the same period in the prior year.

Financial Condition

As discussed in greater detail in our 2000 annual report, we are a leveraged company. Although the debt-to-capital ratio has improved from 72.7% at December 31, 2000 to 65.3% at September 30, 2001, among other things, our high level of debt:

• increases our vulnerability to general adverse economic and industry conditions;

• could limit our ability to obtain additional financing on favorable terms; and

• requires the dedication of a substantial portion of our cash flow from operations to the payment of principal and interest on indebtedness.

In addition, our agreements with our lenders contain a number of covenants, which, among other things, require us to comply with specified financial ratios and tests. At September 30, 2001, we are in compliance with such financial ratios and tests.

Operating activities provided cash of $172.1 million for the nine months ended September 30, 2001 compared to $149.0 million for the nine months ended September 30, 2000. The primary contributors were:

• increases in inventories used $40.7 million in 2001 as compared to $46.7 million in 2000; and

• cash paid to settle accounts payable, accrued expenses and other liabilities was $18.7 million in 2001 versus $97.0 million in 2000.

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These contributors were partially offset by decreases in trade and other receivables of $14.1 million in 2001 versus $76.9 million in 2000.

In 2001, investing activities used $123.2 million of net cash primarily consisting of $122.7 million of additions to property, plant and equipment. In 2000, investing activities used $82.7 million of net cash, consisting of $110.1 million of additions to property, plant and equipment and $5.3 million of investments, partially offset by $15.2 million in proceeds from the sale of clinical chemistry assets to a third party distributor in Spain and $17.5 million in proceeds from the sale of property, plant and equipment.

Net cash used by financing activities was $56.5 million in 2001 compared to $79.3 million in 2000. Net cash paid to reduce our debt was $70.7 million and $94.4 million during 2001 and 2000, respectively. Additionally, we paid $15.6 million and $14.2 million in dividends to our stockholders in 2001 and 2000, respectively. These amounts were partially offset by proceeds received from the issuance of stock of $27.3 million in both 2001 and 2000.

Based upon current levels of operations, anticipated cost savings and future growth, we believe that our cash flow from operations, together with available borrowings under the credit facility and other sources of liquidity (including other credit facilities, leases and any other available financing sources) will be adequate to meet our anticipated requirements until the maturity of the credit facility in October 2002. Given our history of debt reductions, we expect that we will have paid down a substantial amount of our credit facility by its maturity. As such, we expect that we will have the flexibility to evaluate various types of financing including, but not limited to, various forms of debt and/or commercial paper. There can be no assurance, however, that our business will continue to generate cash flows at or above current levels or that estimated cost savings or growth can be achieved. Future operating performance and ability to service or refinance our existing indebtedness, including the credit facility, will be subject to future economic conditions and to financial, business and other factors, many of which are beyond our control.

Our strategies for growth require a flexible infrastructure. As a result of an aggressive acquisition schedule in 1996 and 1997, there are multiple systems and processes currently in use throughout the Company. We have chosen to implement an Oracle enterprise resource planning system (“ERP”) to achieve a single, globally integrated infrastructure. This includes functionality for Finance, Human Resources, Supply Chain, Order Management, Sales and Service to replace or complement existing legacy systems and business processes. We expect that the majority of the work required to implement these new systems will take place through 2002. If we are unable to implement and effectively manage the transition to this new integrated system, our future consolidated operating results could be adversely affected.

24

During the quarter ended June 30, 2001, our senior long-term credit rating at Moody's Investors Service was upgraded to “Baa3”. On November 9, 2001, our senior long-term credit rating at Standard & Poor’s was upgraded to “BBB”. These upgrades, combined with Fitch, Inc.’s “BBB” senior long-term credit rating, give us an investment grade rating at all three rating agencies, improves our financial profile and should enhance our ability to borrow in the future at relatively more favorable rates.

In September 2001, we paid a quarterly cash dividend of $0.085 per share of common stock, for a total of $5.2 million.

Business Climate

The clinical diagnostics and life science research markets are highly competitive with many manufacturers around the world. These markets continue to be unfavorably impacted by the economic weakness in parts of Europe, Asia and Latin America and government and healthcare cost containment initiatives in general. The life science research market also continues to be affected by governmental constraints on research and development spending outside the United States.

In the clinical diagnostics market, attempts to lower costs and to increase productivity have led to further consolidation among healthcare providers in the United States, resulting in more powerful provider groups that continue to leverage their purchasing power to contain costs. Preferred supplier arrangements and combined purchases are becoming more commonplace. Consequently, it has become essential for manufacturers to provide cost-effective diagnostic systems to remain competitive. Cost containment initiatives in the United States and in the European healthcare systems will continue to be factors which may affect our ability to maintain or increase sales. Future profitability may also be adversely affected if the relative value of the U.S. dollar strengthens against certain currencies.

The continuing consolidation trend among United States healthcare providers, mentioned previously, has increased pressure on diagnostic equipment manufacturers to broaden their product offerings to encompass a wider range of testing capability, greater automation and higher volume capacity at a lower cost.

With our leadership position in cellular analysis and our extensive capabilities in routine chemistry and immunodiagnostics, we are able to offer a broad range of automated systems that together can perform more than 75% of a hospital laboratory’s testing needs and essentially 100% of the blood tests that are considered routine. We believe we are able to provide significant value-added benefits, enhanced through our expertise in simplifying and automating laboratory processes, to our customers.

Our new products originate from four sources:

• internal research and development programs;

• external collaborative efforts with individuals in academic institutions and technology companies;

• devices and techniques that are generated in customers’ laboratories; and

• business and technology acquisitions.

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The size and growth of our markets are influenced by a number of factors, including:

• technological innovation in bioanalytical practice;

• government funding for basic and disease-related research (for example, heart disease, AIDS and cancer);

• research and development spending by biotechnology and pharmaceutical companies;

• healthcare spending; and

• physician practice.

We expect worldwide healthcare expenditures and diagnostic testing to increase over the long-term, primarily as a result of the following:

• growing demand for services generated by the increasing size and aging of the world population;

• increasing expenditures on diseases requiring costly or extended treatment (for example, AIDS and cancer); and

• expanding demand for improved healthcare services in developing countries.

In addition to the business climate factors discussed previously, certain economic factors may influence our business:

• currency fluctuations — as approximately 45% of our revenues are generated outside the United States and given the recent fluctuations in foreign currencies, we may experience volatility in sales, operating income and other nonoperating income and expense; and

• interest rates — as approximately 70% of our debt is under variable interest rate terms. This percentage includes the effect of our reverse interest rate swap derivatives which change the character of the interest rate on our long-term debt by effectively converting a fixed rate to a variable rate.

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Recent Accounting Developments

Goodwill and Other Intangible Assets

SFAS 142 “Goodwill and Other Intangible Assets” requires that goodwill and other intangible assets that have indefinite useful lives not be amortized but rather be tested at least annually for impairment. We are required to adopt SFAS 142 on January 1, 2002. However, goodwill and intangible assets acquired after June 30, 2001 are subject to the amortization provisions of SFAS 142. We estimate that the adoption of SFAS 142 will decrease amortization expense in 2002 by approximately $16 million (net of income taxes of $4 million).

Asset Retirement Obligations

SFAS 143 “Accounting for Asset Retirement Obligations” addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. We are required to adopt SFAS 143 on January 1, 2003. We are currently evaluating the impact of SFAS 143 on our consolidated financial statements and results of operations.

Forward-Looking Statements

This Form 10-Q contains forward-looking statements, including statements regarding, among other items:

• the schedule for completion of our ERP program;

• anticipated debt reduction, cash flow available to be applied to debt reduction and the availability of additional financing;

• our business strategy;

• the impacts of recent accounting changes, particularly the adoption of SFAS 142;

• anticipated trends in our business; and

• our liquidity requirements and capital resources.

27

These forward-looking statements are based on our expectations and are subject to a number of risks and uncertainties, some of which are beyond our control. These risks and uncertainties include, but are not limited to:

• unanticipated delays in completing our ERP program;

• anticipated debt reduction;

• complexity and uncertainty regarding development of new high- technology products;

• loss of market share through aggressive competition in the clinical diagnostics and life science research markets;

• our dependence on capital spending policies and government funding;

• the effect of potential healthcare reforms;

• changes in estimates associated with the adoption of SFAS 142;

• fluctuations in foreign exchange rates and interest rates;

• reliance on patents and other intellectual property;

• global economic and political conditions;

• unanticipated reductions in cash flows and difficulty in sales of assets;

• unanticipated euro problems; and

• other factors that cannot be identified at this time.

Although we believe we have the product offerings and resources required to achieve our objectives, actual results could differ materially from those anticipated by these forward-looking statements. There can be no assurance that events anticipated by these forward-looking statements will in fact transpire as expected.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

Our cash flow and earnings are subject to fluctuations due to changes in foreign currency exchange rates and interest rates. We attempt to limit our exposure to these market risks through the use of various financial instruments. Assuming a hypothetical 10% strengthening and 10% weakening of the spot exchange rates for the U.S. dollar against the foreign currencies at September 30, 2001, a 10% strengthening of the U.S. dollar would result in a gain in fair value of $19.7 million and a 10% weakening of the U.S. dollar would result in a loss in fair value of $20.7 million in these instruments. With respect to interest rates, a one percentage point increase or decrease in interest rates would decrease or increase current year’s pre-tax earnings by $1.5 million. For further discussion of the Company’s market risk exposures, refer to the section entitled “Financial Risk Management” included in “Management’s Discussion and Analysis” of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2000.

29

PART II

OTHER INFORMATION

Item 1. Legal Proceedings

In December 1999, Streck Laboratories, Inc. sued Beckman Coulter and Coulter Corporation in the United States District Court for the District of Nebraska. Streck alleges that certain hematology control products sold by Beckman Coulter and/or Coulter Corporation infringe each of six patents owned by Streck, and seeks injunctive relief, damages, attorney fees and costs. We, on behalf of ourselves and Coulter Corporation, have denied liability. The litigation, previously stayed pending settlement discussions, has resumed as a result of the inability of the parties to reach a settlement. The trial is currently scheduled for June 2002. We believe that there is no reasonable basis for us to conclude that this litigation could lead to an outcome that would have a material adverse effect on our consolidated operations, financial position or liquidity.

Item 2. Changes In Securities

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Submission of Matters to a Vote of Security-Holders

None.

Item 5. Other Information

None.

Item 6. Exhibits and Reports on Form 8-K

a) Exhibits

3.0	Amended and Restated By-Laws of Beckman Coulter, Inc. as of June 7, 2001.
10.1	Amendment Number 2001-1 to the Beckman Coulter, Inc. Supplemental Pension Plan, adopted June 29, 2001 and effective as of January 1, 2001.
10.2	2001 Annual Incentive Plan (AIP)
10.3	Amendment Number 2001-1 to the Beckman Coulter, Inc. Savings Plan, adopted November 1, 2001.
10.4	Amendment Number 2001-1 to the Beckman Coulter, Inc. Employees’ Stock Purchase Plan, adopted September 25, 2001.
10.5	Addendum to the Agreement Regarding Retirement Benefits of Fidencio M. Mares, dated August 10, 2001.

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10.6	Addendum to the Agreement Regarding Retirement Benefits of Albert Ziegler, dated August 20, 2001.
11.	Statement re: Computation of Per Share Earnings: This information is set forth in Note 5, Earnings Per Share of the Condensed Consolidated Financial Statements included in Part I herein.
15.	Independent Accountants’ Review Report, October 25, 2001

b) Reports on Form 8-K

     None.

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Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

BECKMAN COULTER, INC.
(Registrant)

Date: November 9, 2001	by	/s/ William H. May
		William H. May Vice President, General Counsel and Secretary

Date: November 9, 2001	by	/s/ Amin I. Khalifa
		Amin I. Khalifa Vice President, Finance and Chief Financial Officer

32

EXHIBIT INDEX

FORM 10-Q, THIRD QUARTER, 2001

Exhibit
Number	Description
3.0	Amended and Restated By-Laws of Beckman Coulter, Inc. as of June 7, 2001.
10.1	Amendment Number 2001-1 to the Beckman Coulter, Inc. Supplemental Pension Plan, adopted June 29, 2001 and effective as of January 1, 2001.
10.2	2001 Annual Incentive Plan (AIP).
10.3	Amendment Number 2001-1 to the Beckman Coulter, Inc. Savings Plan, adopted November 1, 2001.
10.4	Amendment Number 2001-1 to the Beckman Coulter, Inc. Employees’ Stock Purchase Plan, adopted September 25, 2001.
10.5	Addendum to the Agreement Regarding Retirement Benefits of Fidencio M. Mares, dated August 10, 2001.
10.6	Addendum to the Agreement Regarding Retirement Benefits of Albert Ziegler, dated August 20, 2001.
11.	Statement re: Computation of Per Share Earnings: This information is set forth in Note 5, Earnings Per Share, of the Condensed Consolidated Financial Statements included in Part I herein.
15.	Independent Accountants’ Review Report, October 25, 2001

33 EX-3 3 a76921ex3.txt EXHIBIT 3 EXHIBIT 3 BECKMAN COULTER, INC. AMENDED AND RESTATED BY-LAWS ARTICLE I OFFICES SECTION 1. REGISTERED OFFICE. The registered office shall be National Registered Agents, Inc., 9 Loockerman Street, in the city of Dover, County of Kent, State of Delaware, 19901. SECTION 2. PRINCIPAL OFFICE. The principal office for the transaction of the business of the corporation is hereby fixed and located at 4300 North Harbor Boulevard, Fullerton, Orange County, California. ARTICLE II MEETINGS OF STOCKHOLDERS SECTION 1. PLACE OF MEETINGS. All annual meetings of stockholders shall be held at the principal office of the corporation, unless from time to time the Board of Directors, pursuant to authority hereby expressly conferred by resolution, fixes a different place where annual meetings of stockholders shall be held. All other meetings of stockholders shall be held at the principal office or at any other place which may be designated by the Board of Directors pursuant to authority hereby expressly granted. SECTION 2. ANNUAL MEETINGS. The annual meetings of stockholders shall be held on the first Thursday of April of each year, at 10:00 o'clock A.M. of said day -1- or such other day and time as may be designated by resolution of the Board of Directors; provided, however, that should said day fall upon a legal holiday, then any such annual meeting of stockholders shall be held at the same time and place on the next day thereafter ensuing which is not a legal holiday. At an annual meeting of stockholders, only such business shall be conducted, and only such proposals shall be acted upon, as shall have been brought before the annual meeting (a) by, or at the direction of, a majority of the Directors, or (b) by any stockholder of the corporation who complies with the notice procedures set forth in this section. For a proposal to be properly brought before an annual meeting by a stockholder, the stockholder must have given timely notice thereof in writing to the secretary of the corporation. To be timely, a stockholder's notice must be delivered to, or mailed and received at, the principal executive offices of the corporation not less than 60 days prior to the scheduled annual meeting, regardless of any postponements, deferrals or adjournments of that meeting to a later date; provided, however, that if less than 70 days' notice or prior public disclosure of the date of the scheduled annual meeting is given or made, notice by the stockholder, to be timely, must be so delivered or received not later than the close of business on the tenth day following the earlier of the day on which such notice of the date of the scheduled annual meeting was mailed or the day on which such public disclosure was made. A stockholder's notice to the secretary shall set forth as to each matter the stockholder proposes to bring before the annual meeting (a) a brief description of the proposal desired to be brought before the annual meeting and the reasons for conducting such business at the annual meeting, (b) the name and address, as they appear on the -2- corporation's books, of the stockholder proposing such business and any other stockholders known by such stockholder to be supporting such proposal, (c) the class and number of shares of the corporation's stock which are beneficially owned by the stockholder on the date of such stockholder notice and by any other stockholders known by such stockholder to be supporting such proposal on the date of such stockholder notice, and (d) any financial interest of the stockholder in such proposal. The presiding officer of the annual meeting shall determine and declare at the annual meeting whether the stockholder proposal was made in accordance with the terms of this section. If the presiding officer determines that a stockholder proposal was not made in accordance with the terms of this section, he shall so declare at the annual meeting and any such proposal shall not be acted upon at the annual meeting. This provision shall not prevent the consideration and approval or disapproval at the annual meeting of reports of officers, directors and committees of the Board of Directors, but, in connection with such reports, no new business shall be acted upon at such annual meeting unless stated, filed and received as herein provided. SECTION 3. NOTICE OF MEETINGS AND ADJOURNED MEETING. Written notice stating the place, date and hour of any meeting shall be given not fewer than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder entitled to vote at such meeting. If mailed, notice is given when deposited in the United States mail, postage prepaid, directed to the stockholder at his address as it appears on the records of the corporation. When a meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time and place thereof are announced at the -3- meeting at which the adjournment is taken. At the adjourned meeting the corporation may transact any business that might have been transacted at the original meeting. If the adjournment is for more than thirty (30) days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. SECTION 4. SPECIAL MEETINGS. Special meetings of the stockholders of the corporation for any purpose or purposes may be called at any time by the Board of Directors, the chairman of the Board of Directors or the chief executive officer of the corporation. Special meetings of the stockholders of the corporation may not be called by any other person or persons. Except in special cases where other express provision is made by statute, notice of such special meetings shall be given in the same manner as for annual meetings of the stockholders. Notices of any special meetings shall specify, in addition to the place, day and hour of such meeting, the general nature of the business to be transacted. SECTION 5. VOTING; PROXIES. The officer who has charge of the stock ledger of the corporation shall prepare and make, at least ten (10) days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten (10) days prior to the meeting, at the principal place of business of the corporation. The list also shall -4- be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. Upon the willful neglect or refusal of the Directors to produce such a list at any meeting for the election of Directors, they shall be ineligible for election to any office at such meeting. Each stockholder entitled to vote at a meeting of stockholders may authorize another person or persons to act for him by proxy. A stockholder may grant such authority by (a) executing a writing authorizing another person or persons to act for him as proxy, which execution may be accomplished by the stockholder or his authorized officer, director, employee or agent signing such writing or causing his or her signature to be affixed to such writing by any reasonable means including, but not limited to, by facsimile signature, or (b) authorizing another person or persons to act for him as proxy by transmitting or authorizing the transmission of a telegram, cablegram, or other means of electronic transmission (including without limitation by use of telephone keypad or by means of the internet) to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service organization or like agent duly authorized by the person who will be the holder of the proxy to receive such transmission, provided that any such telegram, cablegram or other means of electronic transmission must either set forth or be submitted with information (for example, a password or other similar means) from which it can be determined that the telegram, cablegram or other electronic transmission was authorized by the stockholder, and further provided that any such electronic transmission is recorded electronically or otherwise in a manner that permits -5- conversion of such records into clearly legible paper form within a reasonable time. If it is determined that such telegrams, cablegrams or other electronic transmissions are valid, the inspectors or, if there are no inspectors, such other persons making that determination shall specify the information upon which they relied. Any copy, facsimile telecommunication or other reliable reproduction of the writing or transmission created pursuant to the foregoing subsection (b) may be substituted or used in lieu of the original writing or transmission for any and all purposes for which the original writing or transmission could be used, provided that such copy, facsimile telecommunication or other reproduction shall be a complete reproduction of the entire original writing or transmission. Each original writing, telegram, cablegram or other means of electronic transmission, or a copy, facsimile telecommunication or other reliable reproduction thereof, shall be filed with the secretary of the corporation not later than the day on which exercised. Except as otherwise specifically provided by law, the Certificate of Incorporation or these by-laws, the affirmative vote of the majority of shares present in person or represented by proxy at the meeting and entitled to vote on the subject matter shall be the act of the stockholders. Elections of Directors need not be by written ballot. Except as otherwise specifically provided by law, all other votes may be viva voce or by ballot. SECTION 6. QUORUM. Except as otherwise provided by the law, the Certificate of Incorporation or these by-laws, the presence, in person or by proxy, of the holders of a majority of the outstanding shares entitled to vote shall constitute a quorum, but in no event shall a quorum consist of less than one-third (1/3) of the -6- shares entitled to vote at a meeting. The stockholders present at a duly organized meeting can continue to do business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less than a quorum. SECTION 7. WAIVER OF NOTICE. The transactions of any meeting of stockholders, either annual or special, however called and noticed, shall be as valid as though had at a meeting duly held after regular call and notice, if a quorum be present either in person or by proxy, and if, either before or after the meeting, each of the persons entitled to vote, not present in person or by proxy, signs a written waiver of notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. All such waivers shall be filed with the corporate records or made a part of the minutes of the meeting. SECTION 8. NO ACTION WITHOUT MEETING. Any action required or permitted to be taken at any annual or special meeting of stockholders may be taken only upon the vote of the stockholders at an annual or special meeting duly called and may not be taken by written consent of the stockholders. ARTICLE III DIRECTORS SECTION 1. POWERS. -7- (a) GENERAL POWERS. The Board of Directors shall have all powers necessary or appropriate to the management of the corporation, and, in addition to the power and authority conferred by these by-laws, may exercise all powers of the corporation and do all such lawful acts and things as are not by statute, these by-laws or the Certificate of Incorporation directed or required to be exercised or done by the stockholders. (b) SPECIFIC POWERS. Without limiting the general powers conferred by the last preceding clause and the powers conferred by the Certificate of Incorporation and by-laws of the corporation, it is expressly declared that the Board of Directors shall have the following powers: FIRST - To select and remove all the other officers, agents and employees of the corporation, prescribe such powers and duties for them as may not be inconsistent with law, with the Certificate of Incorporation or the by-laws, fix their compensation and require from them security for faithful service. SECOND - To conduct, manage and control the affairs and business of the corporation, and to make such rules and regulations therefor not inconsistent with law, or with the Certificate of Incorporation or the by-laws, as they may deem best. THIRD - To change the principal office for the transaction of the business of the corporation from one location to another as provided in Article I, Section 2 hereof; to designate the place and time of annual and other meetings of stockholders as provided in Article II, Section 2 -8- and Article II, Section 4 of these by-laws; and to adopt, make and use a corporate seal, and to prescribe the forms of certificates of stock, and to alter the form of such seal and of such certificates from time to time, as in their judgment they may deem best, provided such seal and such certificates shall at all times comply with the provisions of law. FOURTH - To authorize the issuance of shares of stock of the corporation from time to time, upon such terms as may be lawful, in consideration of cash, services rendered, personal property, real property, leases of real property, or a combination thereof, or in the case of shares issued as a dividend against amounts transferred from surplus to stated capital. FIFTH - To borrow money and incur indebtedness for the purposes of the corporation, and to cause to be executed and delivered therefor, in the corporate name, promissory notes, bonds, debentures, deeds of trust, mortgages, pledges, hypothecations or other evidences of debt and securities therefor. SIXTH - To appoint an Executive Committee and other committees, and to delegate to the Executive Committee, to the extent allowed by law, any of the powers and authority of the Board in the management of the business and affairs of the corporation. The Board of Directors shall have the power to prescribe the manner in which proceedings of the Executive Committee and other committees shall be -9- conducted. The Executive Committee shall be composed of two or more Directors. Unless the Board of Directors shall otherwise provide: meetings of the Executive Committee may be called by the Chairman of the Board, chief executive officer, president, any Board elected Vice President who is a member of the Executive Committee, or any two members thereof, upon written notice to the members of the Executive Committee of the time and place of such meeting given in the manner provided for the giving of written notice to members of the Board of Directors of the time and place of special meetings of the Board of Directors; vacancies in the membership of the Executive Committee may be filled by the Board of Directors; a majority of the authorized number of members of the Executive Committee shall constitute a quorum for the transaction of business; and transactions of any meeting of the Executive Committee, however called and noticed or wherever held, after regular call and notice, if a quorum be present and if, either before or after the meeting, each of the members not present signs a written waiver of notice or a consent to holding such meeting or an approval of the minutes thereof. All such waivers, consents or approvals shall be filed with the corporate records or made a part of the minutes of the meeting. SECTION 2. INDEFINITE NUMBER OF DIRECTORS AUTHORIZED. The authorized number of Directors shall be not less than six nor more than twelve. The -10- exact number of Directors shall be fixed from time to time, within the limits specified in this section, by a resolution duly adopted by the Board of Directors. SECTION 3. ELECTION AND TERM OF OFFICE. The Directors shall be elected at each annual meeting of the stockholders but, if any such annual meeting is not held or the Directors are not elected thereat, the Directors may be elected at any special meeting of stockholders held for that purpose. The Directors of the corporation shall be divided into three classes, as nearly equal in number as reasonably possible, with the Directors in each class to hold office until their successors are elected and qualified. At each annual meeting of stockholders of the corporation, the successors to the class of Directors whose term shall then expire shall be elected to hold office for a three year term. If the number of Directors is changed, any increase or decrease shall be apportioned among the classes so as to maintain the number of Directors in each class as nearly equal as possible, and any additional Directors of any class elected to fill a vacancy resulting from an increase in such class shall hold office for a term that shall coincide with the remaining term of that class, but in no case will a decrease in the number of Directors shorten the term of any incumbent Director. A Director shall hold office until the annual meeting for the year in which his term expires and until his successor shall be elected and shall qualify, subject, however, to prior death, resignation, retirement disqualification or removal from office. Notwithstanding the foregoing, no person shall be elected or serve as a Director if such person is in a management position with or a director of a direct competitor of the corporation. -11- Notwithstanding the foregoing, whenever the holders of any one or more classes or series of Preferred Stock issued by the corporation shall have the right, voting separately by class or series, to elect Directors at an annual or special meeting of stockholders, the election, term of office, filling of vacancies and other features of such directorships shall be governed by the terms of the Certificate of Incorporation or the resolution or resolutions adopted by the Board of Directors pursuant to Paragraph 4 of the Certificate of Incorporation, and such Directors so elected shall not be divided into classes pursuant to this section unless expressly provided by such terms. Subject to the rights, if any, of the holders of shares of Preferred Stock then outstanding only persons who are nominated in accordance with the following procedures shall be eligible for election as Directors. Nominations of persons for election to the Board of Directors of the corporation may be made at a meeting of stockholders by or at the direction of the Board of Directors by any nominating committee or person appointed by the board or by any stockholder of the corporation entitled to vote for the election of Directors at the meeting who complies with the notice procedures set forth in this section. Such nominations, other than those made by or at the direction of the Board, shall be made pursuant to timely notice in writing to the secretary of the corporation. To be timely, a stockholder's notice must be delivered to, or mailed and received at, the principal executive offices of the corporation not less than 60 days prior to the scheduled annual meeting, regardless of any postponement, deferrals or adjournments of that meeting to a later date; provided, however, that if less than 70 days' notice or prior public disclosure of the -12- date of the scheduled annual meeting is given or made, notice by the stockholder, to be timely, must be so delivered or received not later than the close of business on the tenth day following the earlier of the day on which such notice of the date of the scheduled annual meeting was mailed or the day on which such public disclosure was made. A stockholder's notice to the secretary shall set forth (a) as to each person whom the stockholder proposes to nominate for election or reelection as a Director, (i) the name, age, business address and residence address of the person, (ii) the principal occupation or employment of the person, (iii) the class and number of shares of capital stock of the corporation which are beneficially owned by the person and (iv) any other information relating to the person that is required to be disclosed in solicitations for proxies for election of Directors pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended; and (b) as to the stockholder giving the notice (i) the name and address, as they appear on the corporation's books, of the stockholder and (ii) the class and number of shares of the corporation's stock which are beneficially owned by the stockholder on the date of such stockholder notice. The corporation may require any proposed nominee to furnish such other information as may reasonably be required by the corporation to determine the eligibility of such proposed nominee to serve as Director of the corporation. The presiding officer of the annual meeting shall determine and declare at the annual meeting whether the nomination was made in accordance with the terms of this section. If the presiding officer determines that a nomination was not made in accordance with the terms of this section, he shall so declare at the annual meeting and any such defective nomination shall be disregarded. -13- SECTION 4. VACANCIES. Newly created directorships resulting from any increase in the number of Directors or any vacancy on the Board of Directors resulting from death, resignation, disqualification, removal or other cause shall be filled solely by the affirmative vote of a majority of the remaining Directors then in office, even though less than a quorum, or by a sole remaining Director. Any Director elected in accordance with the preceding sentence shall hold office for the remainder of the full term of the class of Directors in which the new directorship was created or the vacancy occurred and until such Director's successor shall have been elected and qualified. No decrease in the number of Directors constituting the Board of Directors shall shorten the term of any incumbent Director. SECTION 5. PLACE OF MEETING. Regular meetings of the Board of Directors shall be held at any place within or without the State of Delaware as a majority of the Directors from time to time may designate or by written consent of all members of the Board. In the absence of such designation regular meetings shall be held at the principal office for the transaction of business of the corporation. Special meetings of the Board may be held either at a place so designated or at the principal office. SECTION 6. ORGANIZATION MEETING. Immediately following each annual meeting of the stockholders the Board of Directors shall hold a regular meeting for the purpose of organization, election of officers, and the transaction of other business. Notice of such organizational meetings is hereby dispensed with. SECTION 7. MEETINGS. Meetings of the Board of Directors for any purpose or purposes shall be called at any time by the chairman of the Board, chief executive -14- officer or the president or, if the chief executive officer and president are absent or unable or refuse to act, by any Board elected vice president or by any two Directors. Written notice of the time and place of meetings shall be delivered personally to each Director or sent to each Director by mail, e-mail, facsimile, or by other form of written communication, charges prepaid, addressed to him at his address as it is shown upon the records of the corporation or, if it is not so shown on such records or is not readily ascertainable, at the place in which the meetings of the Directors are regularly held. In case such notice is mailed or telegraphed, it shall be deposited in the United States mail or delivered to the telegraph company in the place in which the principal office of the corporation is located at least forty-eight (48) hours prior to the time of the holding of the meeting. In case such notice is delivered personally as above provided, it shall be so delivered at least twenty-four (24) hours prior to the time of the holding of the meeting. Such mailing, telegraphing or delivery as above provided shall be due, legal and personal notice to such Director. SECTION 8. NOTICE OF ADJOURNMENT. Notice of the time and place of holding an adjourned meeting need not be given to absent Directors if the time and place be fixed at the meeting adjourned. SECTION 9. CONSENT OF ABSENTEES; WAIVER OF NOTICE. The transactions of any meeting of the Board of Directors, however called and noticed or wherever held, shall be as valid as though had at a meeting duly held after regular call and notice, if a quorum be present and if, either before or after the meeting, each of the Directors not present signs a written waiver of notice or a consent to holding such meeting or an approval of the minutes thereof. Attendance of a Director at a -15- meeting shall constitute a waiver of notice of such meeting, except when the Director attends meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. All such waivers, consents or approvals shall be filed with the corporate records or made a part of the minutes of the meeting. SECTION 9.1 ACTION WITHOUT A MEETING. Any action required or permitted to be taken by the Board of Directors, or of any committee thereof, may be taken without a meeting if all members of the Board or committee, as the case may be, individually or collectively consent in writing to such action. Such written consent or consents shall be filed with the minutes of the proceedings of the Board or committee. Such action by written consent shall have the same force and effect as a unanimous vote of the Directors. SECTION 10. QUORUM. A majority of the total number of Directors shall be necessary to constitute a quorum for the transaction of business, except to adjourn as hereinafter provided. Every act or decision done or made by a majority of the Directors present at a meeting duly held at which a quorum is present shall be regarded as the act of the Board of Directors, unless a greater number be required by law or by the Certificate of Incorporation. SECTION 11. ADJOURNMENT. A quorum of the Directors may adjourn any Directors' meeting to meet again at a stated day and hour; provided, however, that in the absence of a quorum a majority of the Directors present at any Directors' meeting, either regular or special, may adjourn from time to time until the time fixed for the next regular meeting of the Board. -16- SECTION 12. FEES AND COMPENSATION. Directors and members of committees may receive such compensation, if any, for their services, and such reimbursement for expenses, as may be fixed or determined by resolution of the Board. SECTION 13. REMOVAL OF DIRECTORS BY STOCKHOLDERS. Subject to the rights, if any, of the holders of shares of Preferred Stock then outstanding, any or all of the Directors of the corporation may be removed from office by the stockholders at any annual or special meeting of stockholders of the corporation, the notice of which shall state that the removal of a Director or Directors is among the purposes of the meeting, but only for cause, by the affirmative vote of at least 66-2/3% of the outstanding shares of Common Stock of the corporation. SECTION 14. RESIGNATIONS. Any Director may resign at any time by submitting his written resignation to the corporation. Such resignation shall take effect at the time of its receipt by the corporation unless another time be fixed in the resignation, in which case it shall become effective at the time so fixed. The acceptance of a resignation shall not be required to make it effective. SECTION 15. PARTICIPATION BY CONFERENCE TELEPHONE. Directors may participate in regular or special meetings of the Board by telephone or similar communications equipment by means of which all other persons at the meeting can hear each other, and such participation shall constitute presence in person at the meeting. -17- SECTION 16. AGE LIMITATION. A person shall not hold office as a director following the annual meeting of stockholders held on or after the date of such person's 70th birthday. -18- ARTICLE IV OFFICERS SECTION 1. OFFICERS. The officers of the corporation shall be a chief executive officer, a president, a vice president, a secretary and a treasurer. The corporation may also have, at the discretion of the Board of Directors, a chairman of the Board, one or more additional vice presidents, one or more assistant secretaries, one or more assistant treasurers, and such other officers as may be appointed in accordance with the provisions of Section 3 of this Article. One person may hold two or more offices except that the secretary shall not be the same person as the chief executive officer or the president. SECTION 2. ELECTION. The officers of the corporation, except such officers as may be appointed in accordance with the provisions of Section 3 or Section 5 of this Article IV, shall be chosen annually by the Board of Directors, and each shall hold his office until he shall resign or shall be removed or otherwise disqualified to serve, or his successor shall be elected and qualified. SECTION 3. SUBORDINATE OFFICERS, ETC. The Board of Directors may appoint such other officers as the business of the corporation require, each of whom shall hold office for such period, shall have such authority and shall perform such duties as are provided in the by-laws or as the Board of Directors may from time to time determine. SECTION 4. REMOVAL AND RESIGNATION. Any officer may be removed either with or without cause, by the Board of Directors, at any regular or special -19- meeting thereof, or, except in the case of an officer chosen by the Board of Directors pursuant to Section 2 of this Article IV, by any officer upon whom such power of removal may be conferred by the Board of Directors. Any officer may resign at any time by giving written notice to the Board of Directors, the Chairman of the Board, the chief executive officer, the president, or the secretary of the corporation. Any such resignation shall take effect at the date of the receipt of such notice or at any later time specified therein; and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective. SECTION 5. VACANCIES. A vacancy in any office because of death, resignation, removal, disqualification or any other cause shall be filled in the manner prescribed in the by-laws for regular appointments to such office. SECTION 6. DELEGATION OF OFFICE. The Board of Directors may delegate the powers or duties of any officer of the corporation to any other officer or to any Director from time to time. SECTION 7. CHAIRMAN OF THE BOARD. The Chairman of the Board, if there shall be such an officer, shall, if present, preside at all meetings of the Board of Directors and exercise and perform such other powers and duties as may be from time to time assigned to him by the Board of Directors or prescribed by the by-laws. SECTION 8. CHIEF EXECUTIVE OFFICER. Subject to such supervisory powers, if any, as may be given by the Board of Directors to the Chairman of the Board, if there be such an officer, the chief executive officer of the corporation shall, subject to the control of the Board of Directors, have general supervision, direction and -20- control of the business and officers of the corporation. He shall preside at all meetings of the stockholders and, in the absence of the Chairman of the Board, or if there be none, at all meetings of the Board of Directors. He shall have the general powers and duties of management usually vested in the office of chief executive officer of a corporation, and shall have such other powers and duties as may be prescribed by the Board of Directors or the by-laws. SECTION 9. PRESIDENT. The president shall be the chief operating officer of the corporation next in authority to the Chairman of the Board and the chief executive officer both of whom he shall assist in the management of the business of the corporation and the implementation of orders and resolutions of the Board of Directors. In the absence of the Chairman of the Board and the chief executive officer, he shall preside at all meetings of the shareholders and of the Board of Directors and shall exercise all other powers and perform all other duties of the chairman of the Board of Directors and the chief executive officer; and he shall perform such other duties as the Board of Directors may from time to time prescribe. SECTION 10. DIVISION PRESIDENTS. In the absence or disability of the chief executive officer, the president or the chief operating officer, the most senior of the board elected division presidents in order of their rank as fixed by the Board of Directors or, if not ranked, the division president designated by the Board of Directors, shall perform all the duties of the chief executive officer, and when so acting shall have all the powers of, and be subject to all the restrictions upon, the chief executive officer. The Board elected division presidents shall have such other -21- powers and perform such other duties as from time to time may be prescribed for them respectively by the Board of Directors or the by-laws. SECTION 11. VICE PRESIDENTS. In the absence or disability of the chief executive officer, the president, the chief operating officer or the division presidents, the most senior of the board elected vice presidents in order of their rank as fixed by the Board of Directors or, if not ranked, the vice president designated by the Board of Directors, shall perform all the duties of the chief executive officer, and when so acting shall have all the powers of, and be subject to all the restrictions upon, the chief executive officer. The Board elected vice presidents shall have such other powers and perform such other duties as from time to time may be prescribed for them respectively by the Board of Directors or the by-laws. SECTION 12. SECRETARY. The secretary shall keep or cause to be kept, at the principal office or such other place as the Board of Directors may order, a book of minutes of all meetings of Directors and stockholders, with the time and place of holding, whether regular or special, and, if special, how authorized, the notice thereof given, the names of those present at Directors' meetings, the number of shares present or represented at stockholders' meetings, and the proceedings thereof. The secretary shall keep, or cause to be kept, at the principal office or at the office of the corporation's transfer agent, a share register, or a duplicate share register, showing the names of the stockholders and their addresses, the number and classes of shares held by each, the number and date of certificates issued for the same, and the number and date of cancellation of every certificate surrendered for cancellation. -22- The secretary shall give, or cause to be given, notice of all the meetings of the stockholders and of the Board of Directors required by the by-laws or by law to be given, and he shall keep the seal of the corporation in safe custody, and shall have such other powers and perform such other duties as may be prescribed by the Board of Directors or by the by-laws. SECTION 13. TREASURER. The treasurer shall keep and maintain, or cause to be kept and maintained, adequate and correct accounts of the properties and business transactions of the corporation, including accounts of its assets, liabilities, receipts, disbursements, gains, losses, capital, surplus and shares. Any surplus, including earned surplus, paid-in surplus and surplus arising from a reduction of stated capital, shall be classified according to source and shown in a separate account. The books of account shall at all reasonable times be open to inspection by any Director. The treasurer shall deposit all moneys and other valuables in the name and to the credit of the corporation with such depositories as may be designated by the Board of Directors. He shall disburse the funds of the corporation, shall render to the chief executive officer, the president and Directors, whenever they request it, an account of all of his transactions as treasurer and of the financial condition of the corporation, and shall have such other powers and perform such other duties as may be prescribed by the Board of Directors or the by-laws. ARTICLE V MISCELLANEOUS -23- SECTION 1. RECORD DATE. The Board of Directors may fix, in advance, a record date to determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action. Such date shall be not more than sixty (60) nor fewer than ten (10) days before the date of any such meeting, nor more than sixty (60) days prior to any other action. If no record date is fixed, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. The record date for determining stockholders for any other purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, the Board of Directors may fix a new record date for the adjourned meeting. SECTION 2. ANNUAL REPORTS. The Board of Directors of the corporation may cause to be sent to the stockholders, not later than one hundred twenty (120) -24- days after the close of the fiscal or calendar year, an annual report in such form as may be deemed appropriate by the Board of Directors. SECTION 3. CERTIFICATES OF STOCK. A certificate or certificates for shares of the capital stock of the corporation shall be issued to each stockholder when any such shares are fully paid up. All such certificates shall be signed by the chairman of the board, chief executive officer, president or a Board elected division president or vice president and the secretary or an assistant secretary, or be authenticated by facsimiles of the signatures of the chairman of the board, chief executive officer, president and secretary or by a facsimile of the signature of the president and the written signature of the secretary or an assistant secretary. Every certificate authenticated by a facsimile of a signature must be countersigned by a transfer agent or transfer clerk, and be registered by an incorporated bank or trust company, either domestic or foreign, as registrar of transfers, before issuance. SECTION 4. REPRESENTATIONS OF SHARES OF OTHER CORPORATIONS. The chief executive officer or president or any Board elected vice president and the secretary or assistant secretary of this corporation are authorized to vote, represent and exercise on behalf of this corporation all rights incident to any and all shares of any other corporation or corporations standing in the name of this corporation. The authority herein granted to said officers to vote or represent on behalf of this corporation any and all shares held by this corporation in any other corporation or corporations may be exercised either by such officers in person or by any other person authorized so to do by proxy or power of attorney duly executed by said officers. -25- SECTION 5. INSPECTION OF BY-LAWS. The corporation shall keep in its principal office for the transaction of business the original or a copy of the by-laws as amended or otherwise altered to date, certified by the secretary, which shall be open to inspection by the stockholders at all reasonable times during office hours. SECTION 6. TRANSFER OF SHARES. Transfer of shares shall be made on the books of the corporation only upon surrender of the share certificate, fully endorsed and otherwise in proper form for transfer, which certificate shall be canceled at the time of the transfer. No transfer of shares shall be made on the books of this corporation if such transfer is in violation of a lawful restriction noted conspicuously on the certificate. SECTION 7. LOST, STOLEN OR DESTROYED SHARE CERTIFICATES. The corporation may issue a new certificate of stock or uncertificated shares in place of any certificate previously issued by it, alleged to have been lost, stolen or destroyed, and the corporation may require the owner of the lost, stolen, or destroyed certificate, or his legal representative, to give the corporation a bond sufficient to indemnify it against any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate or uncertificated shares. SECTION 8. CONSTRUCTION AND DEFINITIONS. Unless the context otherwise requires, the general provisions, rules of construction and definitions contained in the General Corporation Law of the State of Delaware shall govern the construction of these by-laws. Without limiting the generality of the foregoing the masculine gender includes the feminine and neuter, the singular number includes the -26- plural and the plural number includes the singular, and the term "person" includes a corporation as well as a natural person. ARTICLE VI SEAL The form of the seal of the corporation, called the corporate seal of the corporation, shall be as impressed [Form of Seal] adjacent hereto. ARTICLE VII FISCAL YEAR The fiscal year of the corporation shall begin on January 1 and end on December 31. -27- ARTICLE VIII INDEMNIFICATION OF DIRECTORS AND OFFICERS AND OTHER PERSONS SECTION 1. INDEMNIFICATION. Each person who was or is made a party or is threatened to be made a party to or is involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative, (hereinafter a "proceeding"), by reason of the fact that he or she, or a person of whom he or she is the legal representative, is or was a Director or officer of the corporation or is or was serving at the request of the corporation as a Director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans, whether the basis of such proceeding is alleged action in an official capacity as a Director, officer, employee or agent or in any other capacity while serving as a Director, officer, employee or agent, shall be indemnified and held harmless by the corporation to the fullest extent authorized by the Delaware General Corporation Law, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the corporation to provide broader indemnification rights than said law permitted the corporation to provide prior to such amendment), against all expense, liability and loss (including attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts paid or to be paid in settlement) reasonably incurred or suffered by such person in connection therewith and such indemnification shall continue as to a person who has ceased to be a Director, officer, employee or agent and shall inure to the benefit of his or her heirs, executors and administrators; -28- provided, however, that, except as provided in Section 2 of this Article VIII, the corporation shall indemnify any such person seeking indemnification in connection with a proceeding (or part thereof) initiated by such person only if such proceeding (or part thereof) was authorized by the Board of Directors of the corporation. The right to indemnification conferred in this Article VIII shall be a contract right and shall include the right to be paid by the corporation the expenses incurred in defending any such proceeding in advance of its final disposition; provided, however, that, if the Delaware General Corporation Law requires, the payment of such expenses incurred by a Director or officer in his or her capacity as a Director or officer (and not in any other capacity in which service was or is rendered by such person while a Director or officer, including, without limitation, service to an employee benefit plan) in advance of the final disposition of a proceeding, shall be made upon delivery to the corporation of an undertaking, by or on behalf of such Director or officer, to repay all amounts so advanced if it shall ultimately be determined that such Director or officer is not entitled to be indemnified under this Article VIII or otherwise. The right to indemnification conferred in this Article VIII shall include any claim made against the lawful spouse (whether such status is derived by reason of statutory law, common law or otherwise of any applicable jurisdiction in the world) of a Director or officer for claims arising solely out of his or her capacity as the spouse of a Director or officer, including such claims that seek damages recoverable from marital community property, property jointly held by the Director or officer and the spouse, or property transferred from the Director or officer to the spouse; provided, however, that this right shall not include any claim for any actual or alleged Wrongful Act of the spouse -29- and that this right of indemnification shall apply only to actual or alleged Wrongful Acts of a Director or officer. The corporation may, by action of its Board of Directors, provide indemnification to employees and agents of the corporation with the same scope and effect as the foregoing indemnification of Directors and officers. SECTION 2. CLAIM FOR INDEMNIFICATION. If a claim under Section 1 of this Article VIII is not paid in full by the corporation within thirty days after a written claim has been received by the corporation, the claimant may at any time thereafter bring suit against the corporation to recover the unpaid amount of the claim and, if successful in whole or in part, the claimant shall be entitled to be paid also the expense of prosecuting such claim. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in defending any proceeding in advance of its final disposition where the required undertaking, if any is required, has been tendered to the corporation) that the claimant has not met the standards of conduct which make it permissible under the Delaware General Corporation Law for the corporation to indemnify the claimant for the amount claimed, but the burden of proving such defense shall be on the corporation. Neither the failure of the corporation (including its Board of Directors, independent legal counsel or its stockholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the Delaware General Corporation Law, nor an actual determination by the corporation (including its Board of Directors, independent legal counsel, or its stockholders) that the claimant has not met such applicable standard of conduct, -30- shall be a defense to the action or create a presumption that the claimant has not met the applicable standard of conduct. SECTION 3. RIGHT NOT EXCLUSIVE. The right to indemnification and the payment of expenses incurred in defending a proceeding in advance of its final disposition conferred in this Article VIII shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, provision of the Certificate of Incorporation, by-law, agreement, vote of stockholders or disinterested Directors or otherwise. SECTION 4. INSURANCE. The corporation may maintain insurance, at its expense, to protect itself and any Director, officer, employee or agent of the corporation or another corporation, partnership, joint venture, trust or other enterprise against any such expense, liability or loss, whether or not the corporation would have the power to indemnify such person against such expense, liability or loss under the Delaware General Corporation Law. ARTICLE IX AMENDMENTS SECTION 1. AMENDMENTS. (a) BY STOCKHOLDERS. These by-laws may be amended or repealed in whole or in part, and new or additional by-laws may be adopted, by the vote of stockholders entitled to exercise a majority of the voting power of the corporation, except that the vote of stockholders holding more than eighty -31- percent (80%) of the voting power shall be necessary to reduce the authorized number of Directors below five. (b) BY THE BOARD OF DIRECTORS. If the Certificate of Incorporation so provides, these by-laws may be adopted, amended, or repealed by the Board of Directors, provided, however, that no alteration, amendment or repeal of these by-laws that limits indemnification rights or changes the manner or vote required to make such alteration, amendment or repeal, shall be made except by the affirmative vote of stockholders entitled to exercise a majority of the voting power of the corporation. The fact that the power has been so conferred upon the Board of Directors to adopt, amend or repeal these by-laws shall not divest the stockholders of the power nor limit their power to adopt, amend or repeal by-laws. ##### -32- EX-10.1 4 a76921ex10-1.txt EX-10.1 EXHIBIT 10.1 AMENDMENT 2001-1 BECKMAN COULTER, INC. SUPPLEMENTAL PENSION PLAN WHEREAS, Beckman Coulter, Inc. (the "Company"), a Delaware corporation, maintains the Beckman Coulter, Inc. Supplemental Pension Plan (the "Plan"); and WHEREAS, the Company now desires to amend the Plan to coordinate the benefits provided hereunder with increased benefits provided to a group of Participants under the Beckman Coulter, Inc. Pension Plan (the "Pension Plan"); and WHEREAS, the Company has the right to amend the Plan; NOW, THEREFORE, the Plan is hereby amended as follows, effective January 1, 2001: Section 3 is amended by adding the following to the end of the Section: "In the case of any employee identified under Section III of Appendix IV of the Pension Plan, the supplement provided by the Company under this Plan shall be calculated as follows. For each such employee, the supplement that would have been provided under this Plan if the benefit increases under Appendix IV of the Pension Plan had not been adopted shall be calculated (such amount shall be referred to as the "Gross Supplement"). The supplement to be provided by the Company under this Plan shall be the Gross Supplement reduced by the increase to such employee's Pension Plan benefit provided under Appendix IV of the Pension Plan. The increase provided under Appendix IV of the Pension Plan shall be the increase provided after taking into account any applicable limitation on such increase under Section 4.15 of the Pension Plan." -1- IN WITNESS WHEREOF, this Amendment 2001-1 is hereby adopted this 29th day of June, 2001. BECKMAN COULTER, INC. By /s/ Fidencio M. Mares ------------------------------------ Fidencio M. Mares Its Vice President -- Human Resources ----------------------------------- -2- EX-10.2 5 a76921ex10-2.txt EX-10.2 EXHIBIT 10.2 [BECKMAN LOGO] 2001 ANNUAL INCENTIVE PLAN (AIP) WHO PARTICIPATES: Key executives designated by the Chairman of the Board based on qualifying factors established by the Organization and Compensation Committee (the Committee) of the Board of Directors. FUNDING THE AIP: The company must achieve a minimum of (minimum amount) EPS for any funding of AIP awards, regardless of any other financial or non-financial results or individual performance. EPS must exceed (amount) for financial metric payments above target to occur. WHAT IS MEASURED - THE AIP COMPONENTS: There are three financial measurements, as well as the individual performance evaluation, which comprise the 2001 AIP award opportunity. The financial metrics have been selected because they directly align with the company's overall goals and objectives: - Net Earnings - Sales Growth - Debt/EBITDA The individual performance evaluation is linked to the achievement of your goals and objectives, as well as competency development, established and measured through the Performance Success management process. INDIVIDUAL AIP AWARD DETERMINATION: Individual incentive awards are determined by adding the percentages earned based on the level of achievement for financial measurements and your individual performance evaluation. A pro rata incentive award percentage is calculated for gradations between achievement levels for financial results. The sum of the percentages is multiplied by your annual base pay as of December 31, 2001 to arrive at your award amount. For participants with an individual performance rating of "Needs Improvement", the total incentive award (financial results and individual performance) may be reduced by up to 100%. In addition, awards for company financial performance may be reduced based on business unit performance below target. AIP ADMINISTRATION GUIDELINES: The Committee administers the AIP on behalf of the company. This responsibility includes interpretation of the plan and the sole and absolute discretion to establish plan provisions, performance measures, performance targets, specific award levels and participation eligibility. All Committee interpretations, determinations, and actions will be final, conclusive and binding on all participants. The Committee has authorized the Chairman of the Board as its designee in matters of annual plan administration upon its approval of performance measures and targets. AIP TERMS AND CONDITIONS: 1. All financial results will be measured on an "as reported" basis with no adjustment for any effect of currency fluctuations. 2. The Chairman of the Board or his designee will adjust financial measurements and/or calculations as appropriate for mergers, acquisitions, divestitures and/or other one-time or special qualifying events identified as an exception. 3. To be eligible for an AIP award, a participant must be in active pay status continuously through the last company-scheduled workday of the year. Partial payments may be considered, at the full discretion of the Committee or its designee, for retirees as defined by the company's retirement plan, who leave before the end of the plan year. 4. The Committee or its designee may determine in its sole and absolute discretion, the status and incentive award level for any participant whose responsibilities are changed, and of any key employee who becomes eligible to participate in the plan after the beginning of the performance period. 5. AIP awards are payable either in cash or stock at the Committee's discretion. 6. The Committee at any time and from time to time may terminate, suspend, modify or amend the plan. Nothing in this plan or any award granted shall confer on a participant any right to continue in the employ of the company or interfere in any way with the right of the company to terminate any employment. EX-10.3 6 a76921ex10-3.txt EX-10.3 EXHIBIT 10.3 AMENDMENT 2001-1 BECKMAN COULTER, INC. SAVINGS PLAN WHEREAS, Beckman Coulter, Inc. (the "Company"), a Delaware corporation, maintains the Beckman Coulter, Inc. Savings Plan (the "Plan"); and WHEREAS, the Company wishes to amend the Plan to eliminate certain optional forms of distribution as permitted by Treasury Regulations, provide for automatic enrollment, provide that deferrals under the Plan effective January 1, 2002 will be permitted for up to thirty percent (30%) of all compensation, provide for the catch-up contributions allowed by Section 414(v) of the Internal Revenue Code, and make certain changes to the Plan applicable to participants who are also participants under the Company's Restoration Plan; and WHEREAS, the Company has the right to amend the Plan; NOW, THEREFORE, the Plan is hereby amended, effective as set forth below: 1. The second sentence of the definition of Plan Compensation in Section 1.2 is amended by inserting "132(f)" immediately after "401(k)." 2. The following is hereby added to the end of Section 2.2: "Effective April 1, 2002, each Employee shall automatically enroll in the Plan and become a Participant upon first becoming an Eligible Employee, unless he provides (by such procedures as the Committee establishes) an election not to enroll. The automatic enrollment procedures set forth herein shall not apply to any Employee who was an Eligible Employee at any time before April 1, 2002. Unless the Participant elects otherwise, or as otherwise required pursuant to the Plan, the Participant shall be deemed to make the following elections at the time of his automatic enrollment: (a) The Participant shall make Before-Tax Savings Contributions of three percent (3%) of his Plan Compensation; (b) The Participant's Before-Tax Savings Contributions shall be invested in an investment fund designated by the Committee and announced to Eligible Employees; (c) The Participant's Company Matching Contributions shall be invested in the Beckman Coulter Stock Fund; and (d) The Participant's Beneficiary shall be his spouse, if any, and then his estate if his spouse predeceases him. Notwithstanding the preceding deemed elections, the Participant shall be entitled to change any investment elections, contribution amounts, and beneficiary designations, or make any other elections allowed under the Plan, pursuant to the terms of the Plan. 2 Notwithstanding any provision of the Plan to the contrary, contributions, benefits, and service credit with respect to qualified military service will be provided in accordance with Section 414(u) of the Code." 3. Section 3.1(a) is amended to read as follows, effective January 1, 2002: "(a) Election to Defer. Subject to the limitations of this Section and Section 4.1, each Participant may elect to make Before-Tax Savings Contributions, in accordance with procedures prescribed by the Committee in whole percentages from 1% to 30% of said Participant's Plan Compensation. Before-Tax Savings Contributions shall be credited to the Participant's Before-Tax Savings Account, and shall be made in accordance with rules established by the Committee." 4. Section 3.2(a) is amended to read as follows, effective January 1, 2002: "(a) Election to Make After Tax Savings Contributions. Subject to the limitations of Section 3.4 and 4.1, each Participant may elect to make After-Tax Savings Contributions on his own behalf in accordance with procedures established by the Committee in whole percentages from 1% to 15% of said Participant's Plan Compensation." 5. Section 3.3(a) is hereby amended to read as follows, effective January 1, 2002: 3 "(a) Amount of Company Matching Contributions. Subject to the limitations of this Section 3.3, Section 3.4, and Section 4.1, for each Plan Year the Company shall make Company Matching Contributions to the Plan as follows: (i) To the extent a Participant's Company Matching Contributions are invested in the Beckman Coulter Stock Fund in accordance with Section 3.7(b)(2), the Company Matching Contribution shall be equal to 70% of the sum of the Participant's Before-Tax Savings Contributions, After-Tax Savings Contributions and Catch-Up Contributions for the Plan Year on up to 5% of such Participant's Plan Compensation; (ii) To the extent a Participant's Company Matching Contributions are invested in the Investment Funds other than the Beckman Coulter Stock Fund in accordance with Section 3.7(b), the Company Matching Contribution shall be equal to 50% of the sum of the Participant's Before-Tax Savings Contributions, After-Tax Savings Contributions and Catch-Up Contributions for the Plan Year on up to 5% of such Participant's Plan Compensation." 6. Section 3.5 is hereby amended to read as follows, effective January 1, 2002: "A Participant's Before-Tax Savings Contribution percentage, After-Tax Savings Contribution percentage and election concerning Catch-Up Contributions will 4 remain in effect, notwithstanding any change in Plan Compensation, until the Participant elects to discontinue such Contributions or to change the percentage. A Participant may elect as of the first day of each pay period (or such other time established by the Committee) to discontinue, resume or change the percentage of his Before-Tax Savings Contributions, After-Tax Savings Contributions or Catch-Up Contributions, by electing to do so in the manner and at the time prescribed by the Committee. A Participant who is also a participant in the Restoration Plan for a Plan Year shall be permitted to change his or her election of Before-Tax Savings Contributions or Catch-Up Contributions effective as of the first day of a Plan Year, and shall be entitled to change his or her election of After-Tax Savings Contributions during a Plan Year, in each case according to the manner prescribed by the Committee. Notwithstanding the foregoing paragraphs, a Participant who is a participant in the Restoration Plan for a Plan Year shall not be permitted to change, discontinue, or resume his or her election of Before-Tax Savings Contributions or (if applicable) Catch-Up Contributions during that Plan Year; provided, however, that such a Participant may elect, in a manner prescribed by the Committee, to completely discontinue all Before-Tax Savings Contributions, Catch-Up Contributions (if applicable) and After-Tax Savings Contributions under the Plan; provided, however, such a Participant must concurrently discontinue contributions under the Restoration Plan and, if applicable, the Deferred Compensation Plan, 5 and such a Participant may not resume contributions to the Plan or such other plans for the remainder of the Plan Year and the following Plan Year. In addition, a Participant who is also a participant in the Deferred Compensation Plan who discontinues his or her salary and/or bonus deferrals during the year under the Deferred Compensation Plan must at the same time discontinue all Before-Tax Savings Contributions, Catch-Up Contributions (if applicable) and After-Tax Savings Contributions under this Plan and the Restoration Plan. Such a Participant may not resume contributions to this Plan or such other plans for the remainder of the Plan Year and the following Plan Year. The Committee may permit telephonic and on-line elections or change elections and establish rules regarding telephonic and on-line elections. The Committee may establish other rules concerning Before-Tax Savings Contributions, After-Tax Savings Contributions and Catch-Up Contributions. By way of example and not of limitation, such rules may include the following: (a) Rules specifying maximum and/or minimum Before-Tax Savings Contributions and/or After-Tax Savings Contributions, either as dollar or percentage amounts; (b) Rules specifying the frequency with which contribution elections may be changed (and the effective dates of such change elections); 6 (c) Rules establishing specific pay periods for which Before-Tax Savings Contributions, After-Tax Savings Contributions and/or Catch-Up Contributions may be made; and (d) That contribution elections and any changes to Before-Tax Savings Contributions, After-Tax Savings Contributions and/or Catch-Up Contributions be made on forms established by the Committee." 7. The following new Section 3.10 is hereby added to the Plan effective January 1, 2002: "3.10. Catch-Up Contributions. All Participants who are eligible to make Before-Tax Savings Contributions under this Plan and who have obtained age 50 before the close of the Plan Year shall be eligible to make Catch-Up Contributions in accordance with, and subject to the limitations of, Section 414(v) of the Code. Such Catch-Up Contributions shall not be taken into account for purposes of the provisions of the Plan implementing the required limitations of Sections 402(g) and 415 of the Code. The Plan shall not be treated as failing to satisfy the provisions of the Plan implementing the requirements of Section 401(k)(3), 401(k)(11), 401(k)(12), 410(b), or 416 of the Code, as applicable, by reason of the making of such Catch-Up Contributions." 8. Section 4.1 is hereby amended to read as follows, effective January 1, 2002: 7 "Notwithstanding anything else contained herein, the Annual Additions to all the Accounts of a Participant shall not exceed the lesser of $40,000 (adjusted as permitted under Section 415(d)(1) of the Code and regulations issued thereunder) or 100% of the Participant's Section 415 Compensation from the Company and all Related Companies during the Plan Year, in accordance with the provisions of Appendix A attached hereto." 8. Section 6.6(c) is amended by adding the following to the end of the Section, effective as provided in the Small Business Job Protection Act: "If the nonforfeitable balance of the terminating Participant's Accounts is a distribution to which Sections 401(a)(11) and 417 of the Code do not apply, such distribution may commence less than 30 days after the notice described above is given, provided that: (i) the Committee clearly informs the Participant that the Participant has the right to a period of at least 30 days after receiving the notice to consider the decision of whether or not to elect a distribution (and, if applicable, a particular distribution option), and (ii) the Participant, after receiving the notice, affirmatively elects an immediate distribution." 9. The following is hereby added to the end of the first paragraph of Section 4 of Appendix D: "Effective January 1, 2002, only the distribution options generally available under the Plan shall be available pursuant to this Appendix D." 8 IN WITNESS WHEREOF, this Amendment 2001-1 is hereby adopted this 1st day of November, 2001. BECKMAN COULTER, INC. By /s/ Fidencio M. Mares ---------------------------------- Fidencio M. Mares Its Vice President< Human Resources --------------------------------- 9 EX-10.4 7 a76921ex10-4.txt EX-10.4 EXHIBIT 10.4 AMENDMENT 2001-1 BECKMAN COULTER, INC. EMPLOYEES' STOCK PURCHASE PLAN WHEREAS, Beckman Coulter, Inc. (the "Company") maintains the Beckman Coulter, Inc. Employees' Stock Purchase Plan (the "Plan"); and WHEREAS, the Company has the right to amend the Plan, and the Company desires to reflect in the Plan the clarification of how a certain administrative provision works under the Company's change to a bi-weekly payroll in early 2002; NOW, THEREFORE, the Plan is amended as follows, effective January 1, 2002: 1. Section 4 (c) of the Plan is amended by changing the last sentence of sub-section (c) to read as follows: "After commencement of an Option Period, a participant in the Plan may in the time and manner prescribed by the Committee, decrease his or her payroll deductions to the Plan to as low as 1% effective during the Option Period as soon as administratively practical after such decrease direction is submitted." IN WITNESS WHEREOF, the Company has caused its duly authorized officer to execute this Amendment to the Plan on this 25th day of September, 2001. BECKMAN COULTER, INC. BY: /s/ Fidencio M. Mares ------------------------------------- Fidencio M. Mares ITS: Vice President - Human Resources ----------------------------------- EX-10.5 8 a76921ex10-5.txt EX-10.5 EXHIBIT 10.5 ADDENDUM TO THE AGREEMENT REGARDING RETIREMENT BENEFITS OF FIDENCIO M. MARES WHEREAS, Fidencio M. Mares ("Executive") and Beckman Coulter, Inc. ("Company") entered into an agreement ("Agreement") on April 30, 1996 regarding additional retirement benefits for the Executive from the Beckman Coulter, Inc. Supplemental Pension Plan ("Supplemental Plan"). WHEREAS, the Company now wishes to amend the Supplemental Plan, under Amendment 2001-1 thereto, and its Beckman Coulter, Inc. Pension Plan ("Pension Plan"), under Amendment 2001-1 thereto, (collectively, "Amendments") to provide that certain benefits that would have been provided to Executive under the Supplemental Plan (as modified by the Agreement) shall instead be provided under the Pension Plan; NOW, THEREFORE, the Company and the Executive acknowledge and agree that the effect of the Company and the Executive executing this Addendum and the Company's adoption of the Amendments is merely that a portion of the benefits that would otherwise have been provided under the Supplemental Plan and the Agreement shall instead be provided under the Pension Plan. This Addendum is entered into this 10th day of August, 2001. EXECUTIVE By /s/ Fidencio M. Mares ----------------------------- Fidencio M. Mares COMPANY BECKMAN COULTER, INC. By /s/ William H. May ------------------------------ Its Vice President, General ----------------------------- Counsel and Secretary EX-10.6 9 a76921ex10-6.txt EX-10.6 EXHIBIT 10.6 ADDENDUM TO THE AGREEMENT REGARDING RETIREMENT BENEFITS OF ALBERT ZIEGLER WHEREAS, Albert Ziegler("Executive") and Beckman Coulter, Inc. ("Company") entered into an agreement ("Agreement") on June 16, 1995 regarding additional retirement benefits for the Executive from the Beckman Coulter, Inc. Supplemental Pension Plan ("Supplemental Plan"). WHEREAS, the Company now wishes to amend the Supplemental Plan, under Amendment 2001-1 thereto, and its Beckman Coulter, Inc. Pension Plan ("Pension Plan"), under Amendment 2001-1 thereto, (collectively, "Amendments") to provide that certain benefits that would have been provided to Executive under the Supplemental Plan (as modified by the Agreement) shall instead be provided under the Pension Plan; NOW, THEREFORE, the Company and the Executive acknowledge and agree that the effect of the Company and the Executive executing this Addendum and the Company's adoption of the Amendments is merely that a portion of the benefits that would otherwise have been provided under the Supplemental Plan and the Agreement shall instead be provided under the Pension Plan. This Addendum is entered into this 20th day of August, 2001. EXECUTIVE By /s/ Albert Ziegler -------- ------------------ ALBERT ZIEGLER COMPANY BECKMAN COULTER, INC. By /s/ William H. May -------------------------- Its Vice President, General ------------------------- Counsel and Secretary EX-15 10 a76921ex15.txt EXHIBIT 15 Exhibit 15 KPMG LLP Plaza Tower 600 Anton Blvd. Costa Mesa, CA 92626 Independent Accountants' Review Report The Stockholders and Board of Directors Beckman Coulter, Inc.: We have reviewed the condensed consolidated balance sheet of Beckman Coulter, Inc. and subsidiaries as of September 30, 2001, and the related condensed consolidated statements of operations for the three-month and nine month periods ended September 30, 2001 and 2000 and the condensed consolidated statements of cash flows for the nine month periods ended September 30, 2001 and 2000. These condensed consolidated financial statements are the responsibility of the Company's management. We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with auditing standards generally accepted in the United States of America, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to the condensed consolidated financial statements referred to above for them to be in conformity with accounting principles generally accepted in the United States of America. We have previously audited, in accordance with auditing standards generally accepted in the United States of America, the consolidated balance sheet of Beckman Coulter, Inc. and subsidiaries as of December 31, 2000, and the related consolidated statements of operations, stockholders' equity and cash flows for the year then ended (not presented herein); and in our report dated January 25, 2001, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 2000, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived. KPMG LLP Orange County, California October 25, 2001 -----END PRIVACY-ENHANCED MESSAGE-----

EX-3

                                                                       EXHIBIT 3

                              BECKMAN COULTER, INC.
                          AMENDED AND RESTATED BY-LAWS

                                    ARTICLE I

                                     OFFICES

      SECTION 1. REGISTERED OFFICE. The registered office shall be National
Registered Agents, Inc., 9 Loockerman Street, in the city of Dover, County of
Kent, State of Delaware, 19901.

      SECTION 2. PRINCIPAL OFFICE. The principal office for the transaction of
the business of the corporation is hereby fixed and located at 4300 North Harbor
Boulevard, Fullerton, Orange County, California.

                                   ARTICLE II

                            MEETINGS OF STOCKHOLDERS

      SECTION 1. PLACE OF MEETINGS. All annual meetings of stockholders shall be
held at the principal office of the corporation, unless from time to time the
Board of Directors, pursuant to authority hereby expressly conferred by
resolution, fixes a different place where annual meetings of stockholders shall
be held.

      All other meetings of stockholders shall be held at the principal office
or at any other place which may be designated by the Board of Directors pursuant
to authority hereby expressly granted.

      SECTION 2. ANNUAL MEETINGS. The annual meetings of stockholders shall be
held on the first Thursday of April of each year, at 10:00 o'clock A.M. of said
day


                                      -1-

or such other day and time as may be designated by resolution of the Board of
Directors; provided, however, that should said day fall upon a legal holiday,
then any such annual meeting of stockholders shall be held at the same time and
place on the next day thereafter ensuing which is not a legal holiday.

      At an annual meeting of stockholders, only such business shall be
conducted, and only such proposals shall be acted upon, as shall have been
brought before the annual meeting (a) by, or at the direction of, a majority of
the Directors, or (b) by any stockholder of the corporation who complies with
the notice procedures set forth in this section. For a proposal to be properly
brought before an annual meeting by a stockholder, the stockholder must have
given timely notice thereof in writing to the secretary of the corporation. To
be timely, a stockholder's notice must be delivered to, or mailed and received
at, the principal executive offices of the corporation not less than 60 days
prior to the scheduled annual meeting, regardless of any postponements,
deferrals or adjournments of that meeting to a later date; provided, however,
that if less than 70 days' notice or prior public disclosure of the date of the
scheduled annual meeting is given or made, notice by the stockholder, to be
timely, must be so delivered or received not later than the close of business on
the tenth day following the earlier of the day on which such notice of the date
of the scheduled annual meeting was mailed or the day on which such public
disclosure was made. A stockholder's notice to the secretary shall set forth as
to each matter the stockholder proposes to bring before the annual meeting (a) a
brief description of the proposal desired to be brought before the annual
meeting and the reasons for conducting such business at the annual meeting, (b)
the name and address, as they appear on the


                                      -2-

corporation's books, of the stockholder proposing such business and any other
stockholders known by such stockholder to be supporting such proposal, (c) the
class and number of shares of the corporation's stock which are beneficially
owned by the stockholder on the date of such stockholder notice and by any other
stockholders known by such stockholder to be supporting such proposal on the
date of such stockholder notice, and (d) any financial interest of the
stockholder in such proposal.

      The presiding officer of the annual meeting shall determine and declare at
the annual meeting whether the stockholder proposal was made in accordance with
the terms of this section. If the presiding officer determines that a
stockholder proposal was not made in accordance with the terms of this section,
he shall so declare at the annual meeting and any such proposal shall not be
acted upon at the annual meeting.

      This provision shall not prevent the consideration and approval or
disapproval at the annual meeting of reports of officers, directors and
committees of the Board of Directors, but, in connection with such reports, no
new business shall be acted upon at such annual meeting unless stated, filed and
received as herein provided.

      SECTION 3. NOTICE OF MEETINGS AND ADJOURNED MEETING. Written notice
stating the place, date and hour of any meeting shall be given not fewer than
ten (10) nor more than sixty (60) days before the date of the meeting to each
stockholder entitled to vote at such meeting. If mailed, notice is given when
deposited in the United States mail, postage prepaid, directed to the
stockholder at his address as it appears on the records of the corporation.

      When a meeting is adjourned to another time or place, notice need not be
given of the adjourned meeting if the time and place thereof are announced at
the


                                      -3-

meeting at which the adjournment is taken. At the adjourned meeting the
corporation may transact any business that might have been transacted at the
original meeting. If the adjournment is for more than thirty (30) days, or if
after the adjournment a new record date is fixed for the adjourned meeting, a
notice of the adjourned meeting shall be given to each stockholder of record
entitled to vote at the meeting.

      SECTION 4. SPECIAL MEETINGS. Special meetings of the stockholders of the
corporation for any purpose or purposes may be called at any time by the Board
of Directors, the chairman of the Board of Directors or the chief executive
officer of the corporation. Special meetings of the stockholders of the
corporation may not be called by any other person or persons. Except in special
cases where other express provision is made by statute, notice of such special
meetings shall be given in the same manner as for annual meetings of the
stockholders. Notices of any special meetings shall specify, in addition to the
place, day and hour of such meeting, the general nature of the business to be
transacted.

      SECTION 5. VOTING; PROXIES. The officer who has charge of the stock ledger
of the corporation shall prepare and make, at least ten (10) days before every
meeting of stockholders, a complete list of the stockholders entitled to vote at
the meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder.
Such list shall be open to the examination of any stockholder, for any purpose
germane to the meeting, during ordinary business hours, for a period of at least
ten (10) days prior to the meeting, at the principal place of business of the
corporation. The list also shall


                                      -4-

be produced and kept at the time and place of the meeting during the whole time
thereof, and may be inspected by any stockholder who is present.

      Upon the willful neglect or refusal of the Directors to produce such a
list at any meeting for the election of Directors, they shall be ineligible for
election to any office at such meeting.

      Each stockholder entitled to vote at a meeting of stockholders may
authorize another person or persons to act for him by proxy. A stockholder may
grant such authority by (a) executing a writing authorizing another person or
persons to act for him as proxy, which execution may be accomplished by the
stockholder or his authorized officer, director, employee or agent signing such
writing or causing his or her signature to be affixed to such writing by any
reasonable means including, but not limited to, by facsimile signature, or (b)
authorizing another person or persons to act for him as proxy by transmitting or
authorizing the transmission of a telegram, cablegram, or other means of
electronic transmission (including without limitation by use of telephone keypad
or by means of the internet) to the person who will be the holder of the proxy
or to a proxy solicitation firm, proxy support service organization or like
agent duly authorized by the person who will be the holder of the proxy to
receive such transmission, provided that any such telegram, cablegram or other
means of electronic transmission must either set forth or be submitted with
information (for example, a password or other similar means) from which it can
be determined that the telegram, cablegram or other electronic transmission was
authorized by the stockholder, and further provided that any such electronic
transmission is recorded electronically or otherwise in a manner that permits


                                      -5-

conversion of such records into clearly legible paper form within a reasonable
time. If it is determined that such telegrams, cablegrams or other electronic
transmissions are valid, the inspectors or, if there are no inspectors, such
other persons making that determination shall specify the information upon which
they relied. Any copy, facsimile telecommunication or other reliable
reproduction of the writing or transmission created pursuant to the foregoing
subsection (b) may be substituted or used in lieu of the original writing or
transmission for any and all purposes for which the original writing or
transmission could be used, provided that such copy, facsimile telecommunication
or other reproduction shall be a complete reproduction of the entire original
writing or transmission. Each original writing, telegram, cablegram or other
means of electronic transmission, or a copy, facsimile telecommunication or
other reliable reproduction thereof, shall be filed with the secretary of the
corporation not later than the day on which exercised.

      Except as otherwise specifically provided by law, the Certificate of
Incorporation or these by-laws, the affirmative vote of the majority of shares
present in person or represented by proxy at the meeting and entitled to vote on
the subject matter shall be the act of the stockholders. Elections of Directors
need not be by written ballot. Except as otherwise specifically provided by law,
all other votes may be viva voce or by ballot.

      SECTION 6. QUORUM. Except as otherwise provided by the law, the
Certificate of Incorporation or these by-laws, the presence, in person or by
proxy, of the holders of a majority of the outstanding shares entitled to vote
shall constitute a quorum, but in no event shall a quorum consist of less than
one-third (1/3) of the

                                      -6-

shares entitled to vote at a meeting. The stockholders present at a duly
organized meeting can continue to do business until adjournment, notwithstanding
the withdrawal of enough stockholders to leave less than a quorum.

      SECTION 7. WAIVER OF NOTICE. The transactions of any meeting of
stockholders, either annual or special, however called and noticed, shall be as
valid as though had at a meeting duly held after regular call and notice, if a
quorum be present either in person or by proxy, and if, either before or after
the meeting, each of the persons entitled to vote, not present in person or by
proxy, signs a written waiver of notice. Attendance of a person at a meeting
shall constitute a waiver of notice of such meeting, except when the person
attends a meeting for the express purpose of objecting, at the beginning of the
meeting, to the transaction of any business because the meeting is not lawfully
called or convened. All such waivers shall be filed with the corporate records
or made a part of the minutes of the meeting.

      SECTION 8. NO ACTION WITHOUT MEETING. Any action required or permitted to
be taken at any annual or special meeting of stockholders may be taken only upon
the vote of the stockholders at an annual or special meeting duly called and may
not be taken by written consent of the stockholders.

                                   ARTICLE III

                                    DIRECTORS

      SECTION 1. POWERS.


                                      -7-

      (a) GENERAL POWERS. The Board of Directors shall have all powers necessary
      or appropriate to the management of the corporation, and, in addition to
      the power and authority conferred by these by-laws, may exercise all
      powers of the corporation and do all such lawful acts and things as are
      not by statute, these by-laws or the Certificate of Incorporation directed
      or required to be exercised or done by the stockholders.

      (b) SPECIFIC POWERS. Without limiting the general powers conferred by the
      last preceding clause and the powers conferred by the Certificate of
      Incorporation and by-laws of the corporation, it is expressly declared
      that the Board of Directors shall have the following powers:

      FIRST -   To select and remove all the other officers, agents and
                employees of the corporation, prescribe such powers and duties
                for them as may not be inconsistent with law, with the
                Certificate of Incorporation or the by-laws, fix their
                compensation and require from them security for faithful
                service.

      SECOND -  To conduct, manage and control the affairs and business of the
                corporation, and to make such rules and regulations therefor not
                inconsistent with law, or with the Certificate of Incorporation
                or the by-laws, as they may deem best.

      THIRD -   To change the principal office for the transaction of the
                business of the corporation from one location to another as
                provided in Article I, Section 2 hereof; to designate the
                place and time of annual and other meetings of stockholders
                as provided in Article II, Section 2

                                      -8-

                and Article II, Section 4 of these by-laws; and to adopt, make
                and use a corporate seal, and to prescribe the forms of
                certificates of stock, and to alter the form of such seal and of
                such certificates from time to time, as in their judgment they
                may deem best, provided such seal and such certificates shall at
                all times comply with the provisions of law.

      FOURTH -  To authorize the issuance of shares of stock of the
                corporation from time to time, upon such terms as may be lawful,
                in consideration of cash, services rendered, personal property,
                real property, leases of real property, or a combination
                thereof, or in the case of shares issued as a dividend against
                amounts transferred from surplus to stated capital.

      FIFTH -   To borrow money and incur indebtedness for the purposes of the
                corporation, and to cause to be executed and delivered therefor,
                in the corporate name, promissory notes, bonds, debentures,
                deeds of trust, mortgages, pledges, hypothecations or other
                evidences of debt and securities therefor.

      SIXTH -   To appoint an Executive Committee and other committees, and
                to delegate to the Executive Committee, to the extent allowed
                by law, any of the powers and authority of the Board in the
                management of the business and affairs of the corporation.
                The Board of Directors shall have the power to prescribe the
                manner in which proceedings of the Executive Committee and
                other committees shall be

                                      -9-

                conducted. The Executive Committee shall be composed of two or
                more Directors. Unless the Board of Directors shall otherwise
                provide: meetings of the Executive Committee may be called by
                the Chairman of the Board, chief executive officer, president,
                any Board elected Vice President who is a member of the
                Executive Committee, or any two members thereof, upon written
                notice to the members of the Executive Committee of the time and
                place of such meeting given in the manner provided for the
                giving of written notice to members of the Board of Directors of
                the time and place of special meetings of the Board of
                Directors; vacancies in the membership of the Executive
                Committee may be filled by the Board of Directors; a majority of
                the authorized number of members of the Executive Committee
                shall constitute a quorum for the transaction of business; and
                transactions of any meeting of the Executive Committee, however
                called and noticed or wherever held, after regular call and
                notice, if a quorum be present and if, either before or after
                the meeting, each of the members not present signs a written
                waiver of notice or a consent to holding such meeting or an
                approval of the minutes thereof. All such waivers, consents or
                approvals shall be filed with the corporate records or made a
                part of the minutes of the meeting.

      SECTION 2. INDEFINITE NUMBER OF DIRECTORS AUTHORIZED. The authorized
number of Directors shall be not less than six nor more than twelve. The

                                      -10-

exact number of Directors shall be fixed from time to time, within the limits
specified in this section, by a resolution duly adopted by the Board of
Directors.

      SECTION 3. ELECTION AND TERM OF OFFICE. The Directors shall be elected at
each annual meeting of the stockholders but, if any such annual meeting is not
held or the Directors are not elected thereat, the Directors may be elected at
any special meeting of stockholders held for that purpose.

      The Directors of the corporation shall be divided into three classes, as
nearly equal in number as reasonably possible, with the Directors in each class
to hold office until their successors are elected and qualified. At each annual
meeting of stockholders of the corporation, the successors to the class of
Directors whose term shall then expire shall be elected to hold office for a
three year term. If the number of Directors is changed, any increase or decrease
shall be apportioned among the classes so as to maintain the number of Directors
in each class as nearly equal as possible, and any additional Directors of any
class elected to fill a vacancy resulting from an increase in such class shall
hold office for a term that shall coincide with the remaining term of that
class, but in no case will a decrease in the number of Directors shorten the
term of any incumbent Director. A Director shall hold office until the annual
meeting for the year in which his term expires and until his successor shall be
elected and shall qualify, subject, however, to prior death, resignation,
retirement disqualification or removal from office.

      Notwithstanding the foregoing, no person shall be elected or serve as a
Director if such person is in a management position with or a director of a
direct competitor of the corporation.


                                      -11-

      Notwithstanding the foregoing, whenever the holders of any one or more
classes or series of Preferred Stock issued by the corporation shall have the
right, voting separately by class or series, to elect Directors at an annual or
special meeting of stockholders, the election, term of office, filling of
vacancies and other features of such directorships shall be governed by the
terms of the Certificate of Incorporation or the resolution or resolutions
adopted by the Board of Directors pursuant to Paragraph 4 of the Certificate of
Incorporation, and such Directors so elected shall not be divided into classes
pursuant to this section unless expressly provided by such terms.

      Subject to the rights, if any, of the holders of shares of Preferred Stock
then outstanding only persons who are nominated in accordance with the following
procedures shall be eligible for election as Directors. Nominations of persons
for election to the Board of Directors of the corporation may be made at a
meeting of stockholders by or at the direction of the Board of Directors by any
nominating committee or person appointed by the board or by any stockholder of
the corporation entitled to vote for the election of Directors at the meeting
who complies with the notice procedures set forth in this section. Such
nominations, other than those made by or at the direction of the Board, shall be
made pursuant to timely notice in writing to the secretary of the corporation.
To be timely, a stockholder's notice must be delivered to, or mailed and
received at, the principal executive offices of the corporation not less than 60
days prior to the scheduled annual meeting, regardless of any postponement,
deferrals or adjournments of that meeting to a later date; provided, however,
that if less than 70 days' notice or prior public disclosure of the

                                      -12-

date of the scheduled annual meeting is given or made, notice by the
stockholder, to be timely, must be so delivered or received not later than the
close of business on the tenth day following the earlier of the day on which
such notice of the date of the scheduled annual meeting was mailed or the day on
which such public disclosure was made. A stockholder's notice to the secretary
shall set forth (a) as to each person whom the stockholder proposes to nominate
for election or reelection as a Director, (i) the name, age, business address
and residence address of the person, (ii) the principal occupation or employment
of the person, (iii) the class and number of shares of capital stock of the
corporation which are beneficially owned by the person and (iv) any other
information relating to the person that is required to be disclosed in
solicitations for proxies for election of Directors pursuant to Regulation 14A
under the Securities Exchange Act of 1934, as amended; and (b) as to the
stockholder giving the notice (i) the name and address, as they appear on the
corporation's books, of the stockholder and (ii) the class and number of shares
of the corporation's stock which are beneficially owned by the stockholder on
the date of such stockholder notice. The corporation may require any proposed
nominee to furnish such other information as may reasonably be required by the
corporation to determine the eligibility of such proposed nominee to serve as
Director of the corporation.

      The presiding officer of the annual meeting shall determine and declare at
the annual meeting whether the nomination was made in accordance with the terms
of this section. If the presiding officer determines that a nomination was not
made in accordance with the terms of this section, he shall so declare at the
annual meeting and any such defective nomination shall be disregarded.


                                      -13-

      SECTION 4. VACANCIES. Newly created directorships resulting from any
increase in the number of Directors or any vacancy on the Board of Directors
resulting from death, resignation, disqualification, removal or other cause
shall be filled solely by the affirmative vote of a majority of the remaining
Directors then in office, even though less than a quorum, or by a sole remaining
Director. Any Director elected in accordance with the preceding sentence shall
hold office for the remainder of the full term of the class of Directors in
which the new directorship was created or the vacancy occurred and until such
Director's successor shall have been elected and qualified. No decrease in the
number of Directors constituting the Board of Directors shall shorten the term
of any incumbent Director.

      SECTION 5. PLACE OF MEETING. Regular meetings of the Board of Directors
shall be held at any place within or without the State of Delaware as a majority
of the Directors from time to time may designate or by written consent of all
members of the Board. In the absence of such designation regular meetings shall
be held at the principal office for the transaction of business of the
corporation. Special meetings of the Board may be held either at a place so
designated or at the principal office.

      SECTION 6. ORGANIZATION MEETING. Immediately following each annual meeting
of the stockholders the Board of Directors shall hold a regular meeting for the
purpose of organization, election of officers, and the transaction of other
business. Notice of such organizational meetings is hereby dispensed with.

      SECTION 7. MEETINGS. Meetings of the Board of Directors for any purpose or
purposes shall be called at any time by the chairman of the Board, chief
executive

                                      -14-

officer or the president or, if the chief executive officer and president are
absent or unable or refuse to act, by any Board elected vice president or by any
two Directors.

      Written notice of the time and place of meetings shall be delivered
personally to each Director or sent to each Director by mail, e-mail, facsimile,
or by other form of written communication, charges prepaid, addressed to him at
his address as it is shown upon the records of the corporation or, if it is not
so shown on such records or is not readily ascertainable, at the place in which
the meetings of the Directors are regularly held. In case such notice is mailed
or telegraphed, it shall be deposited in the United States mail or delivered to
the telegraph company in the place in which the principal office of the
corporation is located at least forty-eight (48) hours prior to the time of the
holding of the meeting. In case such notice is delivered personally as above
provided, it shall be so delivered at least twenty-four (24) hours prior to the
time of the holding of the meeting. Such mailing, telegraphing or delivery as
above provided shall be due, legal and personal notice to such Director.

      SECTION 8. NOTICE OF ADJOURNMENT. Notice of the time and place of holding
an adjourned meeting need not be given to absent Directors if the time and place
be fixed at the meeting adjourned.

      SECTION 9. CONSENT OF ABSENTEES; WAIVER OF NOTICE. The transactions of any
meeting of the Board of Directors, however called and noticed or wherever held,
shall be as valid as though had at a meeting duly held after regular call and
notice, if a quorum be present and if, either before or after the meeting, each
of the Directors not present signs a written waiver of notice or a consent to
holding such meeting or an approval of the minutes thereof. Attendance of a
Director at a

                                      -15-

meeting shall constitute a waiver of notice of such meeting, except when the
Director attends meeting for the express purpose of objecting, at the beginning
of the meeting, to the transaction of any business because the meeting is not
lawfully called or convened. All such waivers, consents or approvals shall be
filed with the corporate records or made a part of the minutes of the meeting.

      SECTION 9.1 ACTION WITHOUT A MEETING. Any action required or permitted to
be taken by the Board of Directors, or of any committee thereof, may be taken
without a meeting if all members of the Board or committee, as the case may be,
individually or collectively consent in writing to such action. Such written
consent or consents shall be filed with the minutes of the proceedings of the
Board or committee. Such action by written consent shall have the same force and
effect as a unanimous vote of the Directors.

      SECTION 10. QUORUM. A majority of the total number of Directors shall be
necessary to constitute a quorum for the transaction of business, except to
adjourn as hereinafter provided. Every act or decision done or made by a
majority of the Directors present at a meeting duly held at which a quorum is
present shall be regarded as the act of the Board of Directors, unless a greater
number be required by law or by the Certificate of Incorporation.

      SECTION 11. ADJOURNMENT. A quorum of the Directors may adjourn any
Directors' meeting to meet again at a stated day and hour; provided, however,
that in the absence of a quorum a majority of the Directors present at any
Directors' meeting, either regular or special, may adjourn from time to time
until the time fixed for the next regular meeting of the Board.


                                      -16-

      SECTION 12. FEES AND COMPENSATION. Directors and members of committees may
receive such compensation, if any, for their services, and such reimbursement
for expenses, as may be fixed or determined by resolution of the Board.

      SECTION 13. REMOVAL OF DIRECTORS BY STOCKHOLDERS. Subject to the rights,
if any, of the holders of shares of Preferred Stock then outstanding, any or all
of the Directors of the corporation may be removed from office by the
stockholders at any annual or special meeting of stockholders of the
corporation, the notice of which shall state that the removal of a Director or
Directors is among the purposes of the meeting, but only for cause, by the
affirmative vote of at least 66-2/3% of the outstanding shares of Common Stock
of the corporation.

      SECTION 14. RESIGNATIONS. Any Director may resign at any time by
submitting his written resignation to the corporation. Such resignation shall
take effect at the time of its receipt by the corporation unless another time be
fixed in the resignation, in which case it shall become effective at the time so
fixed. The acceptance of a resignation shall not be required to make it
effective.

      SECTION 15. PARTICIPATION BY CONFERENCE TELEPHONE. Directors may
participate in regular or special meetings of the Board by telephone or similar
communications equipment by means of which all other persons at the meeting can
hear each other, and such participation shall constitute presence in person at
the meeting.


                                      -17-

      SECTION 16. AGE LIMITATION. A person shall not hold office as a director
following the annual meeting of stockholders held on or after the date of such
person's 70th birthday.


                                      -18-

                                   ARTICLE IV

                                    OFFICERS

      SECTION 1. OFFICERS. The officers of the corporation shall be a chief
executive officer, a president, a vice president, a secretary and a treasurer.
The corporation may also have, at the discretion of the Board of Directors, a
chairman of the Board, one or more additional vice presidents, one or more
assistant secretaries, one or more assistant treasurers, and such other officers
as may be appointed in accordance with the provisions of Section 3 of this
Article. One person may hold two or more offices except that the secretary shall
not be the same person as the chief executive officer or the president.

      SECTION 2. ELECTION. The officers of the corporation, except such officers
as may be appointed in accordance with the provisions of Section 3 or Section 5
of this Article IV, shall be chosen annually by the Board of Directors, and each
shall hold his office until he shall resign or shall be removed or otherwise
disqualified to serve, or his successor shall be elected and qualified.

      SECTION 3. SUBORDINATE OFFICERS, ETC. The Board of Directors may appoint
such other officers as the business of the corporation require, each of whom
shall hold office for such period, shall have such authority and shall perform
such duties as are provided in the by-laws or as the Board of Directors may from
time to time determine.

      SECTION 4. REMOVAL AND RESIGNATION. Any officer may be removed either with
or without cause, by the Board of Directors, at any regular or special

                                      -19-

meeting thereof, or, except in the case of an officer chosen by the Board of
Directors pursuant to Section 2 of this Article IV, by any officer upon whom
such power of removal may be conferred by the Board of Directors.

      Any officer may resign at any time by giving written notice to the Board
of Directors, the Chairman of the Board, the chief executive officer, the
president, or the secretary of the corporation. Any such resignation shall take
effect at the date of the receipt of such notice or at any later time specified
therein; and, unless otherwise specified therein, the acceptance of such
resignation shall not be necessary to make it effective.

      SECTION 5. VACANCIES. A vacancy in any office because of death,
resignation, removal, disqualification or any other cause shall be filled in the
manner prescribed in the by-laws for regular appointments to such office.

      SECTION 6. DELEGATION OF OFFICE. The Board of Directors may delegate the
powers or duties of any officer of the corporation to any other officer or to
any Director from time to time.

      SECTION 7. CHAIRMAN OF THE BOARD. The Chairman of the Board, if there
shall be such an officer, shall, if present, preside at all meetings of the
Board of Directors and exercise and perform such other powers and duties as may
be from time to time assigned to him by the Board of Directors or prescribed by
the by-laws.

      SECTION 8. CHIEF EXECUTIVE OFFICER. Subject to such supervisory powers, if
any, as may be given by the Board of Directors to the Chairman of the Board, if
there be such an officer, the chief executive officer of the corporation shall,
subject to the control of the Board of Directors, have general supervision,
direction and

                                      -20-

control of the business and officers of the corporation. He shall preside at all
meetings of the stockholders and, in the absence of the Chairman of the Board,
or if there be none, at all meetings of the Board of Directors. He shall have
the general powers and duties of management usually vested in the office of
chief executive officer of a corporation, and shall have such other powers and
duties as may be prescribed by the Board of Directors or the by-laws.

      SECTION 9. PRESIDENT. The president shall be the chief operating officer
of the corporation next in authority to the Chairman of the Board and the chief
executive officer both of whom he shall assist in the management of the business
of the corporation and the implementation of orders and resolutions of the Board
of Directors. In the absence of the Chairman of the Board and the chief
executive officer, he shall preside at all meetings of the shareholders and of
the Board of Directors and shall exercise all other powers and perform all other
duties of the chairman of the Board of Directors and the chief executive
officer; and he shall perform such other duties as the Board of Directors may
from time to time prescribe.

      SECTION 10. DIVISION PRESIDENTS. In the absence or disability of the chief
executive officer, the president or the chief operating officer, the most senior
of the board elected division presidents in order of their rank as fixed by the
Board of Directors or, if not ranked, the division president designated by the
Board of Directors, shall perform all the duties of the chief executive officer,
and when so acting shall have all the powers of, and be subject to all the
restrictions upon, the chief executive officer. The Board elected division
presidents shall have such other

                                      -21-

powers and perform such other duties as from time to time may be prescribed for
them respectively by the Board of Directors or the by-laws.

      SECTION 11. VICE PRESIDENTS. In the absence or disability of the chief
executive officer, the president, the chief operating officer or the division
presidents, the most senior of the board elected vice presidents in order of
their rank as fixed by the Board of Directors or, if not ranked, the vice
president designated by the Board of Directors, shall perform all the duties of
the chief executive officer, and when so acting shall have all the powers of,
and be subject to all the restrictions upon, the chief executive officer. The
Board elected vice presidents shall have such other powers and perform such
other duties as from time to time may be prescribed for them respectively by the
Board of Directors or the by-laws.

      SECTION 12. SECRETARY. The secretary shall keep or cause to be kept, at
the principal office or such other place as the Board of Directors may order, a
book of minutes of all meetings of Directors and stockholders, with the time and
place of holding, whether regular or special, and, if special, how authorized,
the notice thereof given, the names of those present at Directors' meetings, the
number of shares present or represented at stockholders' meetings, and the
proceedings thereof.

      The secretary shall keep, or cause to be kept, at the principal office or
at the office of the corporation's transfer agent, a share register, or a
duplicate share register, showing the names of the stockholders and their
addresses, the number and classes of shares held by each, the number and date of
certificates issued for the same, and the number and date of cancellation of
every certificate surrendered for cancellation.


                                      -22-

      The secretary shall give, or cause to be given, notice of all the meetings
of the stockholders and of the Board of Directors required by the by-laws or by
law to be given, and he shall keep the seal of the corporation in safe custody,
and shall have such other powers and perform such other duties as may be
prescribed by the Board of Directors or by the by-laws.

      SECTION 13. TREASURER. The treasurer shall keep and maintain, or cause to
be kept and maintained, adequate and correct accounts of the properties and
business transactions of the corporation, including accounts of its assets,
liabilities, receipts, disbursements, gains, losses, capital, surplus and
shares. Any surplus, including earned surplus, paid-in surplus and surplus
arising from a reduction of stated capital, shall be classified according to
source and shown in a separate account. The books of account shall at all
reasonable times be open to inspection by any Director.

      The treasurer shall deposit all moneys and other valuables in the name and
to the credit of the corporation with such depositories as may be designated by
the Board of Directors. He shall disburse the funds of the corporation, shall
render to the chief executive officer, the president and Directors, whenever
they request it, an account of all of his transactions as treasurer and of the
financial condition of the corporation, and shall have such other powers and
perform such other duties as may be prescribed by the Board of Directors or the
by-laws.

                                    ARTICLE V

                                  MISCELLANEOUS


                                      -23-

      SECTION 1. RECORD DATE. The Board of Directors may fix, in advance, a
record date to determine the stockholders entitled to notice of or to vote at
any meeting of stockholders or any adjournment thereof, entitled to receive
payment of any dividend or other distribution or allotment of any rights, or
entitled to exercise any rights in respect of any change, conversion or exchange
of stock or for the purpose of any other lawful action. Such date shall be not
more than sixty (60) nor fewer than ten (10) days before the date of any such
meeting, nor more than sixty (60) days prior to any other action.

      If no record date is fixed, the record date for determining stockholders
entitled to notice of or to vote at a meeting of stockholders shall be at the
close of business on the day next preceding the day on which notice is given,
or, if notice is waived, at the close of business on the day next preceding the
day on which the meeting is held.

      The record date for determining stockholders for any other purpose shall
be at the close of business on the day on which the Board of Directors adopts
the resolution relating thereto.

      A determination of stockholders of record entitled to notice of or to vote
at a meeting of stockholders shall apply to any adjournment of the meeting;
provided, however, the Board of Directors may fix a new record date for the
adjourned meeting.

      SECTION 2. ANNUAL REPORTS. The Board of Directors of the corporation may
cause to be sent to the stockholders, not later than one hundred twenty (120)


                                      -24-

days after the close of the fiscal or calendar year, an annual report in such
form as may be deemed appropriate by the Board of Directors.

      SECTION 3. CERTIFICATES OF STOCK. A certificate or certificates for shares
of the capital stock of the corporation shall be issued to each stockholder when
any such shares are fully paid up. All such certificates shall be signed by the
chairman of the board, chief executive officer, president or a Board elected
division president or vice president and the secretary or an assistant
secretary, or be authenticated by facsimiles of the signatures of the chairman
of the board, chief executive officer, president and secretary or by a facsimile
of the signature of the president and the written signature of the secretary or
an assistant secretary. Every certificate authenticated by a facsimile of a
signature must be countersigned by a transfer agent or transfer clerk, and be
registered by an incorporated bank or trust company, either domestic or foreign,
as registrar of transfers, before issuance.

      SECTION 4. REPRESENTATIONS OF SHARES OF OTHER CORPORATIONS. The chief
executive officer or president or any Board elected vice president and the
secretary or assistant secretary of this corporation are authorized to vote,
represent and exercise on behalf of this corporation all rights incident to any
and all shares of any other corporation or corporations standing in the name of
this corporation. The authority herein granted to said officers to vote or
represent on behalf of this corporation any and all shares held by this
corporation in any other corporation or corporations may be exercised either by
such officers in person or by any other person authorized so to do by proxy or
power of attorney duly executed by said officers.


                                      -25-

      SECTION 5. INSPECTION OF BY-LAWS. The corporation shall keep in its
principal office for the transaction of business the original or a copy of the
by-laws as amended or otherwise altered to date, certified by the secretary,
which shall be open to inspection by the stockholders at all reasonable times
during office hours.

      SECTION 6. TRANSFER OF SHARES. Transfer of shares shall be made on the
books of the corporation only upon surrender of the share certificate, fully
endorsed and otherwise in proper form for transfer, which certificate shall be
canceled at the time of the transfer. No transfer of shares shall be made on the
books of this corporation if such transfer is in violation of a lawful
restriction noted conspicuously on the certificate.

      SECTION 7. LOST, STOLEN OR DESTROYED SHARE CERTIFICATES. The corporation
may issue a new certificate of stock or uncertificated shares in place of any
certificate previously issued by it, alleged to have been lost, stolen or
destroyed, and the corporation may require the owner of the lost, stolen, or
destroyed certificate, or his legal representative, to give the corporation a
bond sufficient to indemnify it against any claim that may be made against it on
account of the alleged loss, theft or destruction of any such certificate or the
issuance of such new certificate or uncertificated shares.

      SECTION 8. CONSTRUCTION AND DEFINITIONS. Unless the context otherwise
requires, the general provisions, rules of construction and definitions
contained in the General Corporation Law of the State of Delaware shall govern
the construction of these by-laws. Without limiting the generality of the
foregoing the masculine gender includes the feminine and neuter, the singular
number includes the
                                      -26-

plural and the plural number includes the singular, and the term "person"
includes a corporation as well as a natural person.

                                   ARTICLE VI

                                      SEAL

      The form of the seal of the corporation, called the
corporate seal of the corporation, shall be as impressed          [Form of Seal]
adjacent hereto.

                                   ARTICLE VII

                                   FISCAL YEAR

      The fiscal year of the corporation shall begin on January 1 and end on
December 31.


                                      -27-

                                  ARTICLE VIII

           INDEMNIFICATION OF DIRECTORS AND OFFICERS AND OTHER PERSONS

      SECTION 1. INDEMNIFICATION. Each person who was or is made a party or is
threatened to be made a party to or is involved in any action, suit or
proceeding, whether civil, criminal, administrative or investigative,
(hereinafter a "proceeding"), by reason of the fact that he or she, or a person
of whom he or she is the legal representative, is or was a Director or officer
of the corporation or is or was serving at the request of the corporation as a
Director, officer, employee or agent of another corporation or of a partnership,
joint venture, trust or other enterprise, including service with respect to
employee benefit plans, whether the basis of such proceeding is alleged action
in an official capacity as a Director, officer, employee or agent or in any
other capacity while serving as a Director, officer, employee or agent, shall be
indemnified and held harmless by the corporation to the fullest extent
authorized by the Delaware General Corporation Law, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the extent
that such amendment permits the corporation to provide broader indemnification
rights than said law permitted the corporation to provide prior to such
amendment), against all expense, liability and loss (including attorneys' fees,
judgments, fines, ERISA excise taxes or penalties and amounts paid or to be paid
in settlement) reasonably incurred or suffered by such person in connection
therewith and such indemnification shall continue as to a person who has ceased
to be a Director, officer, employee or agent and shall inure to the benefit of
his or her heirs, executors and administrators;

                                      -28-

provided, however, that, except as provided in Section 2 of this Article VIII,
the corporation shall indemnify any such person seeking indemnification in
connection with a proceeding (or part thereof) initiated by such person only if
such proceeding (or part thereof) was authorized by the Board of Directors of
the corporation. The right to indemnification conferred in this Article VIII
shall be a contract right and shall include the right to be paid by the
corporation the expenses incurred in defending any such proceeding in advance of
its final disposition; provided, however, that, if the Delaware General
Corporation Law requires, the payment of such expenses incurred by a Director or
officer in his or her capacity as a Director or officer (and not in any other
capacity in which service was or is rendered by such person while a Director or
officer, including, without limitation, service to an employee benefit plan) in
advance of the final disposition of a proceeding, shall be made upon delivery to
the corporation of an undertaking, by or on behalf of such Director or officer,
to repay all amounts so advanced if it shall ultimately be determined that such
Director or officer is not entitled to be indemnified under this Article VIII or
otherwise. The right to indemnification conferred in this Article VIII shall
include any claim made against the lawful spouse (whether such status is derived
by reason of statutory law, common law or otherwise of any applicable
jurisdiction in the world) of a Director or officer for claims arising solely
out of his or her capacity as the spouse of a Director or officer, including
such claims that seek damages recoverable from marital community property,
property jointly held by the Director or officer and the spouse, or property
transferred from the Director or officer to the spouse; provided, however, that
this right shall not include any claim for any actual or alleged Wrongful Act of
the spouse

                                      -29-

and that this right of indemnification shall apply only to actual or alleged
Wrongful Acts of a Director or officer. The corporation may, by action of its
Board of Directors, provide indemnification to employees and agents of the
corporation with the same scope and effect as the foregoing indemnification of
Directors and officers.

      SECTION 2. CLAIM FOR INDEMNIFICATION. If a claim under Section 1 of this
Article VIII is not paid in full by the corporation within thirty days after a
written claim has been received by the corporation, the claimant may at any time
thereafter bring suit against the corporation to recover the unpaid amount of
the claim and, if successful in whole or in part, the claimant shall be entitled
to be paid also the expense of prosecuting such claim. It shall be a defense to
any such action (other than an action brought to enforce a claim for expenses
incurred in defending any proceeding in advance of its final disposition where
the required undertaking, if any is required, has been tendered to the
corporation) that the claimant has not met the standards of conduct which make
it permissible under the Delaware General Corporation Law for the corporation to
indemnify the claimant for the amount claimed, but the burden of proving such
defense shall be on the corporation. Neither the failure of the corporation
(including its Board of Directors, independent legal counsel or its
stockholders) to have made a determination prior to the commencement of such
action that indemnification of the claimant is proper in the circumstances
because he or she has met the applicable standard of conduct set forth in the
Delaware General Corporation Law, nor an actual determination by the corporation
(including its Board of Directors, independent legal counsel, or its
stockholders) that the claimant has not met such applicable standard of conduct,


                                      -30-

shall be a defense to the action or create a presumption that the claimant has
not met the applicable standard of conduct.

      SECTION 3. RIGHT NOT EXCLUSIVE. The right to indemnification and the
payment of expenses incurred in defending a proceeding in advance of its final
disposition conferred in this Article VIII shall not be exclusive of any other
right which any person may have or hereafter acquire under any statute,
provision of the Certificate of Incorporation, by-law, agreement, vote of
stockholders or disinterested Directors or otherwise.

      SECTION 4. INSURANCE. The corporation may maintain insurance, at its
expense, to protect itself and any Director, officer, employee or agent of the
corporation or another corporation, partnership, joint venture, trust or other
enterprise against any such expense, liability or loss, whether or not the
corporation would have the power to indemnify such person against such expense,
liability or loss under the Delaware General Corporation Law.

                                   ARTICLE IX

                                   AMENDMENTS

      SECTION 1. AMENDMENTS.

      (a) BY STOCKHOLDERS. These by-laws may be amended or repealed in whole or
      in part, and new or additional by-laws may be adopted, by the vote of
      stockholders entitled to exercise a majority of the voting power of the
      corporation, except that the vote of stockholders holding more than eighty


                                      -31-

      percent (80%) of the voting power shall be necessary to reduce the
      authorized number of Directors below five.

      (b) BY THE BOARD OF DIRECTORS. If the Certificate of Incorporation so
      provides, these by-laws may be adopted, amended, or repealed by the Board
      of Directors, provided, however, that no alteration, amendment or repeal
      of these by-laws that limits indemnification rights or changes the manner
      or vote required to make such alteration, amendment or repeal, shall be
      made except by the affirmative vote of stockholders entitled to exercise a
      majority of the voting power of the corporation. The fact that the power
      has been so conferred upon the Board of Directors to adopt, amend or
      repeal these by-laws shall not divest the stockholders of the power nor
      limit their power to adopt, amend or repeal by-laws.

                                     #####


                                      -32-

EX-10.1

                                                                    EXHIBIT 10.1



                                AMENDMENT 2001-1

                              BECKMAN COULTER, INC.
                            SUPPLEMENTAL PENSION PLAN


      WHEREAS, Beckman Coulter, Inc. (the "Company"), a Delaware corporation,
maintains the Beckman Coulter, Inc. Supplemental Pension Plan (the "Plan"); and

      WHEREAS, the Company now desires to amend the Plan to coordinate the
benefits provided hereunder with increased benefits provided to a group of
Participants under the Beckman Coulter, Inc. Pension Plan (the "Pension Plan");
and

      WHEREAS, the Company has the right to amend the Plan;

      NOW, THEREFORE, the Plan is hereby amended as follows, effective January
1, 2001:

      Section 3 is amended by adding the following to the end of the Section:

            "In the case of any employee identified under Section III of
      Appendix IV of the Pension Plan, the supplement provided by the Company
      under this Plan shall be calculated as follows. For each such employee,
      the supplement that would have been provided under this Plan if the
      benefit increases under Appendix IV of the Pension Plan had not been
      adopted shall be calculated (such amount shall be referred to as the
      "Gross Supplement"). The supplement to be provided by the Company under
      this Plan shall be the Gross Supplement reduced by the increase to such
      employee's Pension Plan benefit provided under Appendix IV of the Pension
      Plan. The increase provided under Appendix IV of the Pension Plan shall be
      the increase provided after taking into account any applicable limitation
      on such increase under Section 4.15 of the Pension Plan."



                                      -1-



      IN WITNESS WHEREOF, this Amendment 2001-1 is hereby adopted this 29th day
of June, 2001.

                                      BECKMAN COULTER, INC.



                                      By /s/ Fidencio M. Mares
                                        ------------------------------------
                                             Fidencio M. Mares

                                      Its Vice President -- Human Resources
                                         -----------------------------------



                                      -2-

EX-10.2

                                                                    EXHIBIT 10.2

[BECKMAN LOGO]



                        2001 ANNUAL INCENTIVE PLAN (AIP)

WHO PARTICIPATES:

Key executives designated by the Chairman of the Board based on qualifying
factors established by the Organization and Compensation Committee (the
Committee) of the Board of Directors.

FUNDING THE AIP:

The company must achieve a minimum of (minimum amount) EPS for any funding of
AIP awards, regardless of any other financial or non-financial results or
individual performance. EPS must exceed (amount) for financial metric payments
above target to occur.

WHAT IS MEASURED - THE AIP COMPONENTS:

There are three financial measurements, as well as the individual performance
evaluation, which comprise the 2001 AIP award opportunity. The financial metrics
have been selected because they directly align with the company's overall goals
and objectives:

               -   Net Earnings

               -   Sales Growth

               -   Debt/EBITDA

The individual performance evaluation is linked to the achievement of your goals
and objectives, as well as competency development, established and measured
through the Performance Success management process.

INDIVIDUAL AIP AWARD DETERMINATION:

Individual incentive awards are determined by adding the percentages earned
based on the level of achievement for financial measurements and your individual
performance evaluation. A pro rata incentive award percentage is calculated for
gradations between achievement levels for financial results. The sum of the
percentages is multiplied by your annual base pay as of December 31, 2001 to
arrive at your award amount. For participants with an individual performance
rating of "Needs Improvement", the total incentive award (financial results and
individual performance) may be reduced by up to 100%. In addition, awards for
company financial performance may be reduced based on business unit performance
below target.

AIP ADMINISTRATION GUIDELINES:

The Committee administers the AIP on behalf of the company. This responsibility
includes interpretation of the plan and the sole and absolute discretion to
establish plan provisions, performance measures, performance targets, specific
award levels and participation eligibility. All Committee interpretations,
determinations, and actions will be final, conclusive and binding on all
participants. The Committee has authorized the Chairman of the Board as its
designee in matters of annual plan administration upon its approval of
performance measures and targets.

AIP TERMS AND CONDITIONS:

1.    All financial results will be measured on an "as reported" basis with no
      adjustment for any effect of currency fluctuations.

2.    The Chairman of the Board or his designee will adjust financial
      measurements and/or calculations as appropriate for mergers, acquisitions,
      divestitures and/or other one-time or special qualifying events identified
      as an exception.

3.    To be eligible for an AIP award, a participant must be in active pay
      status continuously through the last company-scheduled workday of the
      year. Partial payments may be considered, at the full discretion of the
      Committee or its designee, for retirees as defined by the company's
      retirement plan, who leave before the end of the plan year.

4.    The Committee or its designee may determine in its sole and absolute
      discretion, the status and incentive award level for any participant whose
      responsibilities are changed, and of any key employee who becomes eligible
      to participate in the plan after the beginning of the performance period.

5.    AIP awards are payable either in cash or stock at the Committee's
      discretion.

6.    The Committee at any time and from time to time may terminate, suspend,
      modify or amend the plan. Nothing in this plan or any award granted shall
      confer on a participant any right to continue in the employ of the company
      or interfere in any way with the right of the company to terminate any
      employment.

EX-10.3

                                                                    EXHIBIT 10.3

                                AMENDMENT 2001-1

                              BECKMAN COULTER, INC.
                                  SAVINGS PLAN


      WHEREAS, Beckman Coulter, Inc. (the "Company"), a Delaware corporation,
maintains the Beckman Coulter, Inc. Savings Plan (the "Plan"); and

      WHEREAS, the Company wishes to amend the Plan to eliminate certain
optional forms of distribution as permitted by Treasury Regulations, provide for
automatic enrollment, provide that deferrals under the Plan effective January 1,
2002 will be permitted for up to thirty percent (30%) of all compensation,
provide for the catch-up contributions allowed by Section 414(v) of the Internal
Revenue Code, and make certain changes to the Plan applicable to participants
who are also participants under the Company's Restoration Plan; and

      WHEREAS, the Company has the right to amend the Plan;

      NOW, THEREFORE, the Plan is hereby amended, effective as set forth below:

      1.    The second sentence of the definition of Plan Compensation in
Section 1.2 is amended by inserting "132(f)" immediately after "401(k)."

      2.    The following is hereby added to the end of Section 2.2:

      "Effective April 1, 2002, each Employee shall automatically enroll in the
      Plan and become a Participant upon first becoming an Eligible Employee,
      unless he provides (by such procedures as the Committee establishes) an
      election not to enroll. The automatic enrollment procedures set forth
      herein shall not apply to any Employee who was an Eligible Employee at any
      time before April 1, 2002.



      Unless the Participant elects otherwise, or as otherwise required pursuant
      to the Plan, the Participant shall be deemed to make the following
      elections at the time of his automatic enrollment:


      (a)   The Participant shall make Before-Tax Savings Contributions of three
      percent (3%) of his Plan Compensation;


      (b)   The Participant's Before-Tax Savings Contributions shall be invested
      in an investment fund designated by the Committee and announced to
      Eligible Employees;


      (c)   The Participant's Company Matching Contributions shall be invested
      in the Beckman Coulter Stock Fund; and


      (d)   The Participant's Beneficiary shall be his spouse, if any, and then
      his estate if his spouse predeceases him.


      Notwithstanding the preceding deemed elections, the Participant shall be
      entitled to change any investment elections, contribution amounts, and
      beneficiary designations, or make any other elections allowed under the
      Plan, pursuant to the terms of the Plan.



                                       2


      Notwithstanding any provision of the Plan to the contrary, contributions,
      benefits, and service credit with respect to qualified military service
      will be provided in accordance with Section 414(u) of the Code."


      3.    Section 3.1(a) is amended to read as follows, effective January 1,
      2002:


      "(a) Election to Defer. Subject to the limitations of this Section and
      Section 4.1, each Participant may elect to make Before-Tax Savings
      Contributions, in accordance with procedures prescribed by the Committee
      in whole percentages from 1% to 30% of said Participant's Plan
      Compensation. Before-Tax Savings Contributions shall be credited to the
      Participant's Before-Tax Savings Account, and shall be made in accordance
      with rules established by the Committee."


      4.    Section 3.2(a) is amended to read as follows, effective January 1,
      2002:

      "(a) Election to Make After Tax Savings Contributions. Subject to the
      limitations of Section 3.4 and 4.1, each Participant may elect to make
      After-Tax Savings Contributions on his own behalf in accordance with
      procedures established by the Committee in whole percentages from 1% to
      15% of said Participant's Plan Compensation."


      5.    Section 3.3(a) is hereby amended to read as follows, effective
      January 1, 2002:


                                       3


      "(a) Amount of Company Matching Contributions. Subject to the limitations
      of this Section 3.3, Section 3.4, and Section 4.1, for each Plan Year the
      Company shall make Company Matching Contributions to the Plan as follows:


            (i) To the extent a Participant's Company Matching Contributions are
            invested in the Beckman Coulter Stock Fund in accordance with
            Section 3.7(b)(2), the Company Matching Contribution shall be equal
            to 70% of the sum of the Participant's Before-Tax Savings
            Contributions, After-Tax Savings Contributions and Catch-Up
            Contributions for the Plan Year on up to 5% of such Participant's
            Plan Compensation;


            (ii) To the extent a Participant's Company Matching Contributions
            are invested in the Investment Funds other than the Beckman Coulter
            Stock Fund in accordance with Section 3.7(b), the Company Matching
            Contribution shall be equal to 50% of the sum of the Participant's
            Before-Tax Savings Contributions, After-Tax Savings Contributions
            and Catch-Up Contributions for the Plan Year on up to 5% of such
            Participant's Plan Compensation."


      6.    Section 3.5 is hereby amended to read as follows, effective January
      1, 2002:

      "A Participant's Before-Tax Savings Contribution percentage, After-Tax
      Savings Contribution percentage and election concerning Catch-Up
      Contributions will



                                       4


      remain in effect, notwithstanding any change in Plan Compensation, until
      the Participant elects to discontinue such Contributions or to change the
      percentage. A Participant may elect as of the first day of each pay period
      (or such other time established by the Committee) to discontinue, resume
      or change the percentage of his Before-Tax Savings Contributions,
      After-Tax Savings Contributions or Catch-Up Contributions, by electing to
      do so in the manner and at the time prescribed by the Committee.


      A Participant who is also a participant in the Restoration Plan for a Plan
      Year shall be permitted to change his or her election of Before-Tax
      Savings Contributions or Catch-Up Contributions effective as of the first
      day of a Plan Year, and shall be entitled to change his or her election of
      After-Tax Savings Contributions during a Plan Year, in each case according
      to the manner prescribed by the Committee.


      Notwithstanding the foregoing paragraphs, a Participant who is a
      participant in the Restoration Plan for a Plan Year shall not be permitted
      to change, discontinue, or resume his or her election of Before-Tax
      Savings Contributions or (if applicable) Catch-Up Contributions during
      that Plan Year; provided, however, that such a Participant may elect, in a
      manner prescribed by the Committee, to completely discontinue all
      Before-Tax Savings Contributions, Catch-Up Contributions (if applicable)
      and After-Tax Savings Contributions under the Plan; provided, however,
      such a Participant must concurrently discontinue contributions under the
      Restoration Plan and, if applicable, the Deferred Compensation Plan,


                                       5



      and such a Participant may not resume contributions to the Plan or such
      other plans for the remainder of the Plan Year and the following Plan
      Year. In addition, a Participant who is also a participant in the Deferred
      Compensation Plan who discontinues his or her salary and/or bonus
      deferrals during the year under the Deferred Compensation Plan must at the
      same time discontinue all Before-Tax Savings Contributions, Catch-Up
      Contributions (if applicable) and After-Tax Savings Contributions under
      this Plan and the Restoration Plan. Such a Participant may not resume
      contributions to this Plan or such other plans for the remainder of the
      Plan Year and the following Plan Year.


      The Committee may permit telephonic and on-line elections or change
      elections and establish rules regarding telephonic and on-line elections.
      The Committee may establish other rules concerning Before-Tax Savings
      Contributions, After-Tax Savings Contributions and Catch-Up Contributions.
      By way of example and not of limitation, such rules may include the
      following:


                  (a)   Rules specifying maximum and/or minimum Before-Tax
            Savings Contributions and/or After-Tax Savings Contributions, either
            as dollar or percentage amounts;

                  (b)   Rules specifying the frequency with which contribution
            elections may be changed (and the effective dates of such change
            elections);


                                       6


                  (c)   Rules establishing specific pay periods for which
            Before-Tax Savings Contributions, After-Tax Savings Contributions
            and/or Catch-Up Contributions may be made; and

                  (d)   That contribution elections and any changes to
            Before-Tax Savings Contributions, After-Tax Savings Contributions
            and/or Catch-Up Contributions be made on forms established by the
            Committee."

            7.    The following new Section 3.10 is hereby added to the Plan
effective January 1, 2002:

            "3.10. Catch-Up Contributions. All Participants who are eligible to
            make Before-Tax Savings Contributions under this Plan and who have
            obtained age 50 before the close of the Plan Year shall be eligible
            to make Catch-Up Contributions in accordance with, and subject to
            the limitations of, Section 414(v) of the Code. Such Catch-Up
            Contributions shall not be taken into account for purposes of the
            provisions of the Plan implementing the required limitations of
            Sections 402(g) and 415 of the Code. The Plan shall not be treated
            as failing to satisfy the provisions of the Plan implementing the
            requirements of Section 401(k)(3), 401(k)(11), 401(k)(12), 410(b),
            or 416 of the Code, as applicable, by reason of the making of such
            Catch-Up Contributions."


            8.    Section 4.1 is hereby amended to read as follows, effective
January 1, 2002:


                                       7


                  "Notwithstanding anything else contained herein, the Annual
            Additions to all the Accounts of a Participant shall not exceed the
            lesser of $40,000 (adjusted as permitted under Section 415(d)(1) of
            the Code and regulations issued thereunder) or 100% of the
            Participant's Section 415 Compensation from the Company and all
            Related Companies during the Plan Year, in accordance with the
            provisions of Appendix A attached hereto."


            8.    Section 6.6(c) is amended by adding the following to the end
of the Section, effective as provided in the Small Business Job Protection Act:


            "If the nonforfeitable balance of the terminating Participant's
            Accounts is a distribution to which Sections 401(a)(11) and 417 of
            the Code do not apply, such distribution may commence less than 30
            days after the notice described above is given, provided that: (i)
            the Committee clearly informs the Participant that the Participant
            has the right to a period of at least 30 days after receiving the
            notice to consider the decision of whether or not to elect a
            distribution (and, if applicable, a particular distribution option),
            and (ii) the Participant, after receiving the notice, affirmatively
            elects an immediate distribution."


            9.    The following is hereby added to the end of the first
paragraph of Section 4 of Appendix D:

            "Effective January 1, 2002, only the distribution options generally
            available under the Plan shall be available pursuant to this
            Appendix D."



                                       8


      IN WITNESS WHEREOF, this Amendment 2001-1 is hereby adopted this 1st day
of November, 2001.


                                         BECKMAN COULTER, INC.



                                         By  /s/ Fidencio M. Mares
                                           ----------------------------------
                                                Fidencio M. Mares

                                         Its  Vice President< Human Resources
                                             ---------------------------------





                                       9

EX-10.4

                                                                    EXHIBIT 10.4


                                AMENDMENT 2001-1

                             BECKMAN COULTER, INC.
                         EMPLOYEES' STOCK PURCHASE PLAN


      WHEREAS, Beckman Coulter, Inc. (the "Company") maintains the Beckman
Coulter, Inc. Employees' Stock Purchase Plan (the "Plan"); and

      WHEREAS, the Company has the right to amend the Plan, and the Company
desires to reflect in the Plan the clarification of how a certain administrative
provision works under the Company's change to a bi-weekly payroll in early 2002;

      NOW, THEREFORE, the Plan is amended as follows, effective January 1, 2002:

      1.    Section 4 (c) of the Plan is amended by changing the last sentence
            of sub-section

            (c)   to read as follows:


            "After commencement of an Option Period, a participant in the Plan
            may in the time and manner prescribed by the Committee, decrease his
            or her payroll deductions to the Plan to as low as 1% effective
            during the Option Period as soon as administratively practical after
            such decrease direction is submitted."


            IN WITNESS WHEREOF, the Company has caused its duly authorized
officer to execute this Amendment to the Plan on this 25th day of September,
2001.


                                       BECKMAN COULTER, INC.

                                       BY: /s/ Fidencio M. Mares
                                          -------------------------------------
                                               Fidencio M. Mares

                                       ITS:   Vice President - Human Resources
                                            -----------------------------------

EX-10.5

                                                                    EXHIBIT 10.5


                           ADDENDUM TO THE AGREEMENT
                          REGARDING RETIREMENT BENEFITS
                              OF FIDENCIO M. MARES


      WHEREAS, Fidencio M. Mares ("Executive") and Beckman Coulter, Inc.
("Company") entered into an agreement ("Agreement") on April 30, 1996 regarding
additional retirement benefits for the Executive from the Beckman Coulter, Inc.
Supplemental Pension Plan ("Supplemental Plan").

      WHEREAS, the Company now wishes to amend the Supplemental Plan, under
Amendment 2001-1 thereto, and its Beckman Coulter, Inc. Pension Plan ("Pension
Plan"), under Amendment 2001-1 thereto, (collectively, "Amendments") to provide
that certain benefits that would have been provided to Executive under the
Supplemental Plan (as modified by the Agreement) shall instead be provided under
the Pension Plan;

      NOW, THEREFORE, the Company and the Executive acknowledge and agree that
the effect of the Company and the Executive executing this Addendum and the
Company's adoption of the Amendments is merely that a portion of the benefits
that would otherwise have been provided under the Supplemental Plan and the
Agreement shall instead be provided under the Pension Plan.

      This Addendum is entered into this 10th day of August, 2001.


                                             EXECUTIVE


                                             By  /s/ Fidencio M. Mares
                                                -----------------------------
                                                     Fidencio M. Mares


                                             COMPANY
                                             BECKMAN COULTER, INC.



                                             By /s/ William H. May
                                               ------------------------------

                                             Its Vice President, General
                                                -----------------------------
                                                   Counsel and Secretary

EX-10.6

                                                                   EXHIBIT 10.6


                           ADDENDUM TO THE AGREEMENT
                          REGARDING RETIREMENT BENEFITS
                                OF ALBERT ZIEGLER


        WHEREAS, Albert Ziegler("Executive") and Beckman Coulter, Inc.
("Company") entered into an agreement ("Agreement") on June 16, 1995 regarding
additional retirement benefits for the Executive from the Beckman Coulter, Inc.
Supplemental Pension Plan ("Supplemental Plan").

        WHEREAS, the Company now wishes to amend the Supplemental Plan, under
Amendment 2001-1 thereto, and its Beckman Coulter, Inc. Pension Plan ("Pension
Plan"), under Amendment 2001-1 thereto, (collectively, "Amendments") to provide
that certain benefits that would have been provided to Executive under the
Supplemental Plan (as modified by the Agreement) shall instead be provided under
the Pension Plan;

        NOW, THEREFORE, the Company and the Executive acknowledge and agree that
the effect of the Company and the Executive executing this Addendum and the
Company's adoption of the Amendments is merely that a portion of the benefits
that would otherwise have been provided under the Supplemental Plan and the
Agreement shall instead be provided under the Pension Plan.

        This Addendum is entered into this 20th day of August, 2001.


                                              EXECUTIVE


                                              By /s/ Albert Ziegler
                                                -------- ------------------
                                                     ALBERT ZIEGLER

                                              COMPANY
                                              BECKMAN COULTER, INC.



                                              By /s/ William H. May
                                                 --------------------------

                                              Its Vice President, General
                                                  -------------------------
                                                   Counsel and Secretary

EX-15

                                                                      Exhibit 15

KPMG LLP
Plaza Tower
600 Anton Blvd.
Costa Mesa, CA 92626

       Independent Accountants' Review Report

The Stockholders and Board of Directors
Beckman Coulter, Inc.:

We have reviewed the condensed consolidated balance sheet of Beckman Coulter,
Inc. and subsidiaries as of September 30, 2001, and the related condensed
consolidated statements of operations for the three-month and nine month periods
ended September 30, 2001 and 2000 and the condensed consolidated statements of
cash flows for the nine month periods ended September 30, 2001 and 2000. These
condensed consolidated financial statements are the responsibility of the
Company's management.

We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with auditing standards generally accepted in the United States of America, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should
be made to the condensed consolidated financial statements referred to above for
them to be in conformity with accounting principles generally accepted in the
United States of America.

We have previously audited, in accordance with auditing standards generally
accepted in the United States of America, the consolidated balance sheet of
Beckman Coulter, Inc. and subsidiaries as of December 31, 2000, and the related
consolidated statements of operations, stockholders' equity and cash flows for
the year then ended (not presented herein); and in our report dated January 25,
2001, we expressed an unqualified opinion on those consolidated financial
statements. In our opinion, the information set forth in the accompanying
condensed consolidated balance sheet as of December 31, 2000, is fairly stated,
in all material respects, in relation to the consolidated balance sheet from
which it has been derived.

                                                  KPMG LLP


Orange County, California
October 25, 2001