-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PH6sw45CSC+/Tvaq0nNNwYUFVmMWs5BTmQp9cpOhYWY24BbxzJO8klVg/4PcjgWx aaZB5PjjoNOqF8xMwkP/mw== 0000950123-02-000514.txt : 20020413 0000950123-02-000514.hdr.sgml : 20020413 ACCESSION NUMBER: 0000950123-02-000514 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20020118 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FISHER SCIENTIFIC INTERNATIONAL INC CENTRAL INDEX KEY: 0000880430 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-PROFESSIONAL & COMMERCIAL EQUIPMENT & SUPPLIES [5040] IRS NUMBER: 020451017 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: 1933 Act SEC FILE NUMBER: 333-77046 FILM NUMBER: 2512959 BUSINESS ADDRESS: STREET 1: LIBERTY LANE CITY: HAMPTON STATE: NH ZIP: 03842 BUSINESS PHONE: 6039265911 MAIL ADDRESS: STREET 1: LIBERTY LANE CITY: LIBEHAMPTON STATE: NH ZIP: 03842 S-3 1 l92310s-3.txt FISHER SCIENTIFIC INTERNATIONAL INC. AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 18, 2002 REGISTRATION NO. 333- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 --------------------- FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 --------------------- FISHER SCIENTIFIC INTERNATIONAL INC. (Exact name of Registrant as specified in its charter) DELAWARE 02-0451017 (State or other jurisdiction of incorporation or (I.R.S. Employer Identification Number) organization)
ONE LIBERTY LANE HAMPTON, NEW HAMPSHIRE 03842 (603) 926-5911 (Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices) --------------------- TODD M. DUCHENE, ESQ. VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY FISHER SCIENTIFIC INTERNATIONAL INC. ONE LIBERTY LANE HAMPTON, NEW HAMPSHIRE 03842 (603) 926-5911 (Name, address, including zip code, and telephone number, including area code, of agent for service) --------------------- COPIES TO: DAVID J. GOLDSCHMIDT, ESQ. DAVID E. REDLICK, ESQ. SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP STUART R. NAYMAN, ESQ. FOUR TIMES SQUARE HALE AND DORR LLP NEW YORK, NEW YORK 10036-6522 300 PARK AVENUE (212) 735-3000 NEW YORK, NEW YORK 10022 (212) 937-7200
--------------------- APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as practicable after the effective date of this Registration Statement. --------------------- If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. [ ] If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [ ] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] __________ If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] __________ If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [ ] --------------------- CALCULATION OF REGISTRATION FEE
- --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE AGGREGATE REGISTRATION SECURITIES TO BE REGISTERED REGISTERED(1) PER SHARE(2) OFFERING PRICE(2) FEE - --------------------------------------------------------------------------------------------------------------------------------- Common stock, par value $.01 per share.......................... 7,475,000 shares $30.50 $227,987,500 $20,974.85 - --------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------
(1) Includes common stock issuable upon exercise of the underwriters' over-allotment option. (2) Estimated solely for the purpose of calculating the amount of the registration fee, pursuant to Rule 457(c) of the Securities Act of 1933, as amended, based upon the average of the high and low prices of the common stock on January 17, 2002, as reported on the New York Stock Exchange. --------------------- THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell securities nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION. DATED JANUARY 18, 2002. 6,500,000 Shares FISHER SCIENTIFIC INTERNATIONAL INC. Common Stock ------------------------ All of the shares of common stock in the offering are being sold by the selling stockholders identified in this prospectus. Fisher Scientific will not receive any of the proceeds from the sale of the shares. The common stock is listed on the New York Stock Exchange under the symbol "FSH." The last reported sale price of the common stock on January 17, 2002 was $31.00 per share. See "Risk Factors" beginning on page 6 to read about factors you should consider before buying the shares of common stock. ------------------------ NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER REGULATORY BODY HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ------------------------
Per Share Total --------- ----- Initial price to public................................... $ $ Underwriting discount..................................... $ $ Proceeds, before expenses, to the selling stockholders.... $ $
To the extent that the underwriters sell more than 6,500,000 shares of common stock, the underwriters have the option to purchase up to an additional 975,000 shares from the selling stockholders at the initial public offering price less the underwriting discount. ------------------------ The underwriters expect to deliver the shares against payment in New York, New York on , 2002. GOLDMAN, SACHS & CO. CREDIT SUISSE FIRST BOSTON JPMORGAN MERRILL LYNCH & CO. MORGAN STANLEY ------------------------ Prospectus dated January , 2002. PROSPECTUS SUMMARY This summary does not contain all the information that you should consider before investing in our common stock. You should read the entire prospectus carefully, especially "Risk Factors" beginning on page 6. OUR BUSINESS We are a world leader in serving science. We offer more than 600,000 products and services that enable scientific discovery and clinical laboratory testing services to more than 350,000 customers located in approximately 145 countries. As a result of our broad product offering, integrated global logistics network and electronic commerce capabilities, we serve as a "one-stop source" of products, services and global solutions for many of our customers. Our primary target markets are life science, clinical laboratory and industrial safety supply. Our products include scientific instruments and equipment, clinical consumables, diagnostic reagents, safety and clean room supplies and laboratory equipment and workstations. We offer both proprietary products and products that we source from more than 6,000 third-party vendors. Our proprietary products consist of self-manufactured products, Fisher branded products and products for which we serve as the exclusive distributor. We generate approximately 80% of our revenues from the sale of consumable products. We believe that this revenue base provides us with a broad and stable platform for future growth. We offer a range of services, such as third-party procurement, bench-top delivery, laboratory instrument calibration and repair and contract manufacturing. Our broad offering of products and services enables us to effectively serve a diverse range of customers. Through acquisitions of a pharmaceutical packaging services business and a diagnostic manufacturing facility, we have expanded our outsourcing capabilities to offer a more comprehensive suite of services and leverage our brand recognition in the pharmaceutical and biotechnology industries. In addition, through our acquisition of Cole-Parmer Instrument Company and its affiliated companies, which we refer to collectively as Cole-Parmer, we have enhanced our offerings of specialty technical products, including products manufactured by Cole-Parmer and other proprietary products. We have assembled an integrated global logistics network through which we service our customers. This network, together with our order entry and inventory management systems, allows us to deliver products and provide services on a rapid basis worldwide. We make approximately 25,000 shipments each day. In the United States, we ship approximately 95% of all orders within 24 hours of the customer placing the order. We were founded in 1902 and trace our roots back to 1851. Through organic growth and acquisitions we have established ourselves as a world leader in serving science. In January 1998, our management, in conjunction with affiliates of Thomas H. Lee Partners and other investors, purchased 87% of our common stock. Upon completion of this offering, Thomas H. Lee Partners and its affiliates and the other members of this investment group will own approximately 49.9% of our common stock. OUR CUSTOMERS We market our products and services to three principal customer groups: - laboratories engaged in scientific research and testing, including laboratories funded by biotechnology, medical technology and pharmaceutical companies, research institutions, medical schools and universities; - healthcare providers that perform diagnostic tests on patients, such as independent clinical laboratories, hospitals and physician office laboratories; and - users of occupational health and safety products in manufacturing and other activities. 1 OUR COMPETITIVE STRENGTHS AND STRATEGY We believe that our key competitive strengths include our: - leading global brand name; - broad product and service offering; - premier and diversified customer base; - worldwide network of 3,000 sales and customer service professionals; and - global logistics and sourcing capabilities. Our objective is to enhance our position as a world leader in serving science. The key elements of our strategy are to: - continue to leverage our competitive strengths; - continue to develop our operational capabilities and pursue strategic acquisitions that allow us to further penetrate existing markets, expand our product and service offerings and increase our portfolio of value-added services; - leverage and maintain our technology leadership; and - capitalize on current growth opportunities in the life science and other markets that we serve. RECENT DEVELOPMENTS In November 2001, we acquired Cole-Parmer for approximately $208.5 million, net of cash acquired. Cole-Parmer is a leading worldwide manufacturer and distributor of specialty technical instruments, appliances, equipment and supplies. Its customers include industrial and pharmaceutical companies, academic institutions and governmental entities and original equipment manufacturers. We believe the acquisition will enable us to expand the breadth of our product offerings and strengthen our self-manufactured product portfolio. During the fourth quarter of 2001, we commenced implementation of a plan focused on further integration of our international operations and recent acquisitions and the continued streamlining of our domestic operations, including the consolidation of certain distribution centers. The principal elements of this plan are the reduction of our workforce by approximately 3% and the consolidation of international sales and distribution facilities. We estimate that the total costs associated with this plan will be approximately $10.9 million. We expect to record a restructuring charge of $9.5 million in the fourth quarter of 2001 in connection with the restructuring plan. Upon completion of this plan, we expect a reduction of approximately $6.0 million in annual pre-tax expenses. Of this amount, we intend to reinvest approximately $3.0 million in our sales and marketing efforts and distribution capabilities surrounding our chemical and life sciences product portfolio. As a net result, we expect to realize annual savings of $3.0 million beginning in 2002. CORPORATE INFORMATION Our principal executive offices are located at One Liberty Lane, Hampton, New Hampshire 03842, and our telephone number is (603) 926-5911. Our website is located at www.fisherscientific.com. The information on our website is not part of this prospectus. 2 THE OFFERING Common stock offered by the selling stockholders................................ 6,500,000 shares Common stock to be outstanding after this offering.................................... 54,152,184 shares New York Stock Exchange symbol.............. FSH Use of proceeds............................. We will not receive any of the proceeds from the sale of shares by the selling stockholders. The number of shares of our common stock that will be outstanding after this offering is based on our shares of common stock outstanding as of November 30, 2001, which consisted of: - 50,116,894 shares of voting common stock; and - 4,035,290 shares of non-voting common stock. Except as otherwise indicated, all references in this prospectus to our "common stock" are references to our voting and non-voting common stock, collectively. The number of outstanding shares excludes: - 4,375,816 shares of common stock issuable upon the exercise of options outstanding as of November 30, 2001 under our 1998 stock option plan at a weighted average exercise price of $12.73 per share; - 2,583,315 shares of common stock issuable upon the exercise of warrants outstanding as of November 30, 2001 at a weighted average exercise price of $9.65 per share; - 3,140,217 shares of common stock issuable upon the exercise of options outstanding as of November 30, 2001 under our 2001 stock option plan at a weighted average exercise price of $26.26 per share; and - 4,791,033 shares of common stock reserved for future grants under our 2001 stock option plan. Except as otherwise indicated, all information in this prospectus assumes no exercise of the underwriters' over-allotment option. 3 SUMMARY FINANCIAL DATA The following tables summarize our financial data. You should read these tables along with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our financial statements and related notes that are incorporated by reference in this prospectus. The results of operations for the nine months ended September 30, 2001 and 2000 have been derived from our unaudited interim financial statements. The pro forma financial information gives effect to our acquisition of Cole-Parmer as if it had occurred on January 1, 2000 for statement of operations purposes and on September 30, 2001 for balance sheet purposes. You should read the summary pro forma financial information along with "Pro Forma Combined Financial Information" appearing elsewhere in this prospectus.
NINE MONTHS ENDED SEPTEMBER 30, YEAR ENDED DECEMBER 31, -------------------------------- ----------------------------------------- 2001 2000 2000 1999 1998(1) -------------------- -------- ------------------- -------- -------- PRO PRO FORMA ACTUAL FORMA ACTUAL -------- -------- -------- -------- (IN MILLIONS, EXCEPT PER SHARE DATA) STATEMENT OF OPERATIONS DATA: Sales.......................... $2,256.2 $2,125.3 $1,977.6 $2,794.0 $2,622.3 $2,514.5 $2,294.4 Cost of sales.................. 1,658.2 1,585.6 1,487.8 2,069.5 1,974.0 1,885.4 1,721.0 -------- -------- -------- -------- -------- -------- -------- Gross profit................... 598.0 539.7 489.8 724.5 648.3 629.1 573.4 Selling, general and administrative expense....... 447.6 400.0 369.4 552.7 494.0 472.5 440.9 Restructuring and other charges (credits)(2)................. 51.6 51.6 (2.0) (2.0) (2.0) (1.5) 23.6 Recapitalization-related costs(3)..................... -- -- -- -- -- -- 71.0 Loss from operations to be disposed of(4)............... -- -- -- -- -- 11.3 15.1 -------- -------- -------- -------- -------- -------- -------- Income from operations......... 98.8 88.1 122.4 173.8 156.3 146.8 22.8 Interest expense............... 76.7 74.9 75.0 102.4 99.1 104.2 90.3 Other (income) expense, net(5)....................... 6.9 1.6 (4.3) 28.8 19.4 (15.2) (7.2) -------- -------- -------- -------- -------- -------- -------- Income (loss) before income taxes........................ 15.2 11.6 51.7 42.6 37.8 57.8 (60.3) Provision (benefit) for income taxes........................ 7.1 6.2 20.7 16.2 15.1 34.4 (10.8) -------- -------- -------- -------- -------- -------- -------- Net income (loss).............. $ 8.1 $ 5.4 $ 31.0 $ 26.4 $ 22.7 $ 23.4 $ (49.5) ======== ======== ======== ======== ======== ======== ======== Net income (loss) per common share: Basic........................ $ 0.17 $ 0.11 $ 0.77 $ 0.66 $ 0.57 $ 0.59 $ (1.24) Diluted...................... $ 0.16 $ 0.10 $ 0.70 $ 0.59 $ 0.51 $ 0.55 $ (1.24) Weighted average common shares outstanding: Basic........................ 47.8 47.8 40.1 40.1 40.1 40.0 40.0 Diluted...................... 51.6 51.6 44.3 44.4 44.4 42.8 40.0 OTHER FINANCIAL DATA: EBITDA(6)...................... $ 209.3 $ 194.4 $ 174.0 $ 251.3 $ 226.8 $ 223.9 $ 189.7 Cash flows provided by (used in): Operating activities......... 87.4 77.8 51.8 110.1 107.2 124.7 149.9 Investing activities......... (193.5) (196.8) (46.4) (63.8) (57.1) (62.5) (231.8) Financing activities......... 266.0 282.7 (18.6) (45.7) (32.8) (74.1) 129.3
4
AS OF SEPTEMBER 30, 2001 ------------------------- ACTUAL PRO FORMA ------ --------- (IN MILLIONS) BALANCE SHEET DATA: Working capital........................................... $ 325.7 $ 161.7 Total assets.............................................. 1,779.0 1,799.6 Long-term liabilities..................................... 1,193.6 1,194.5 Stockholders' equity...................................... 12.1 12.1
- --------------- (1) On January 21, 1998, we were recapitalized in a transaction in which approximately 87% of our fully diluted shares of common stock were converted into the right to receive $9.65 per share in cash. In connection with this recapitalization, we entered into new debt financing arrangements. The recapitalization and debt financing arrangements are more fully described in Notes 2 and 12 to our audited financial statements incorporated by reference in this prospectus. (2) During the fourth quarter of 1998, we recorded $23.6 million of restructuring and other charges. These charges included asset impairment charges in the United States and Asia and personnel reductions in the United States and Europe. (3) In connection with our recapitalization on January 21, 1998, we recorded $71.0 million of expenses consisting primarily of non-cash compensation expenses relating to the conversion of employee stock options, the implementation of certain executive severance agreements and the grant of options to certain executives in accordance with the terms of the recapitalization. (4) Loss from operations to be disposed of includes a $5.2 million write-off of in-process research and development costs associated with an acquisition in 1999, and a $2.6 million charge for restructuring and asset impairment costs in 1998. (5) Other (income) expense, net includes a $23.6 million charge for the write down of certain Internet-related investments in 2000 and $7.8 million of gains from asset sales in 1999. (6) We define "EBITDA" as net income plus income taxes, interest expense, depreciation and amortization. In calculating EBITDA, we exclude restructuring charges, recapitalization-related charges and other nonrecurring items. We use EBITDA here because we believe that it can assist you in comparing our performance to that of other companies on a consistent basis without regard to depreciation, amortization or one-time items. Depreciation and amortization can vary significantly among companies depending on accounting methods, particularly where acquisitions or non-operating factors including historical cost bases are involved. We believe that EBITDA as we define it is also useful because it enables you to compare our performance before the effect of various one-time items that do not directly affect our operating performance. However, you should not consider EBITDA as an alternative to measures of financial performance determined in accordance with generally accepted accounting principles, such as net income as a measure of operating results or cash flows as a measure of liquidity. Our computation of EBITDA may not be comparable to similarly titled measures of other companies. It is also not the same computation of EBITDA that we make under our various debt agreements, which limit the amount of nonrecurring items that can be excluded in computing EBITDA for purposes of those agreements. 5 RISK FACTORS You should carefully consider the following risk factors in addition to the other information in this prospectus before investing in our common stock. If any of the following risks actually occur, our business, financial condition or results of operations would likely suffer. In that case, the trading price of our common stock could fall, and you may lose all or part of the money that you paid to buy our common stock. RISKS RELATED TO OUR BUSINESS OUR HIGH LEVERAGE MAY HARM OUR BUSINESS We had $1,046.0 million in outstanding indebtedness and stockholders' equity of $12.1 million as of September 30, 2001. Our debt agreements permit us to incur or guarantee additional indebtedness, subject to limitations set forth in those agreements. Our substantial indebtedness could have important consequences to you. Our high leverage could negatively affect our operations in a number of ways, including: - we may be unable to obtain additional financing for our operations or for acquisitions or expansions; - we must dedicate a significant part of our cash flow from operations to payments on our debt, thereby reducing funds available for other corporate purposes; and - the level of our debt could limit our flexibility in responding to downturns in our business. In addition, we will be required to repay the indebtedness under our various debt agreements as that indebtedness matures. We may not have sufficient funds or we may be unable to arrange for additional financing to pay these amounts when they become due. OUR COMPLIANCE WITH RESTRICTIONS AND COVENANTS IN OUR DEBT AGREEMENTS MAY LIMIT OUR ABILITY TO TAKE CORPORATE ACTIONS AND HARM OUR BUSINESS Our debt agreements contain a number of covenants that significantly restrict our operations, our ability to issue additional debt and our ability to pay dividends. Under our bank credit agreement we are also required to comply with specific financial ratios and tests, including maximum leverage ratios and minimum EBITDA to cash interest expense ratios. We may not be able to comply in the future with these covenants or restrictions as a result of events beyond our control, such as prevailing economic, financial and industry conditions. If we default in the performance of the covenants in our debt agreements, our lenders could declare all the principal and interest amounts outstanding due and payable and terminate their commitments to extend credit to us in the future. If we are unable to secure credit in the future, our business could be harmed. BECAUSE OUR RESULTS OF OPERATIONS DEPEND ON OUR CUSTOMERS' RESEARCH AND DEVELOPMENT EFFORTS, OUR BUSINESS MAY BE HARMED IF OUR CUSTOMERS DO NOT EXPEND SUFFICIENT RESOURCES ON THESE ACTIVITIES A significant number of our customers include entities active in scientific or technological research in the life science, clinical laboratory and industrial safety supply markets, in the United States and internationally. Research and development budgets and activities have a large effect on the demand for our products and services. Our customers determine their research and development budgets based on several factors, including the need to develop new products, competition and the general availability of resources. Although scientific and technology-related research and development spending in the United States historically has not been subject to cyclical swings, this trend may not continue. In addition, as we continue to expand our 6 international operations, the research and development spending levels in other global markets will become increasingly important to us. A decrease in research and development spending by our customers could cause our sales and profitability to decrease. IF WE DO NOT SUCCESSFULLY ACQUIRE AND INTEGRATE NEW BUSINESSES, OUR REVENUE GROWTH MAY SLOW AND OUR RESULTS OF OPERATIONS MAY BE NEGATIVELY AFFECTED Acquisitions are an important part of our growth strategy. Since 1991, we have acquired 30 businesses and we routinely review additional potential acquisition opportunities. Integration of acquisitions involves a number of special risks, including: - the diversion of management's attention to the integration of the operations of businesses we have acquired; - difficulties in the integration of operations and systems and the realization of potential operating synergies; - the assimilation and retention of the personnel of the acquired companies; - challenges in retaining the customers of the combined businesses; and - potential adverse short-term effects on operating results. In addition, we compete with other companies to acquire suitable targets, and we may not be able to successfully acquire the targets that we desire. If we are unable to successfully complete and integrate strategic acquisitions in a timely manner, our growth strategy could be harmed. BECAUSE WE RELY HEAVILY ON THIRD PARTY PACKAGE DELIVERY SERVICES, ANY UNANTICIPATED DISRUPTIONS IN THESE SERVICES OR SIGNIFICANT INCREASES IN PRICES MAY HARM OUR BUSINESS We ship a significant portion of our products to our customers through independent package delivery companies, such as UPS. We also maintain a small fleet of transportation vehicles dedicated to the delivery of our products. In the first nine months of 2001 and in the year ended December 31, 2000, we shipped approximately 60% of our products in the United States via UPS. We also ship our products through other carriers, including national and regional trucking firms, overnight courier services and the U.S. Postal Service. The labor contract for UPS's delivery employees expires on July 31, 2002. If UPS or another third party package delivery provider experiences a major work stoppage, as UPS did in 1997, such that either our products would not be delivered in a timely fashion or we would incur additional shipping costs which we could not pass on to our customers, our business may be harmed. In addition, if UPS or our other third party package delivery providers increase prices and we are not able to find alternatives or make adjustments to our delivery network, our profitability would be harmed. OUR OPERATIONS ARE SUBJECT TO ENVIRONMENTAL REGULATION, AND FAILURE TO COMPLY WITH ENVIRONMENTAL REGULATIONS COULD HARM OUR BUSINESS A number of our domestic and international operations involve and have involved the handling, manufacture or use or sale of substances that are or could be classified as toxic or hazardous substances. Some risk of environmental damage is inherent in our operations and the products we manufacture, sell or distribute. We have been named as a potentially responsible party for environmental contamination associated with various sites. We are currently implementing remedial measures at some of our facilities, including at two of our facilities in New Jersey. We have established reserves for the potential costs of this remediation based on estimates of our management and environmental specialists. However, our actual costs may exceed those reflected in our reserves. In addition, future environmental damage resulting from our operations may occur, the costs of which may harm our business. Future events, including 7 changes in existing laws and regulations and the development of new remediation techniques, may also give rise to additional costs which could harm our business. IF WE LOSE OUR KEY PERSONNEL, OUR BUSINESS MAY BE HARMED We depend heavily on the services of our senior management, including Paul M. Montrone, our chairman of the board and chief executive officer, and Paul M. Meister, our vice chairman of the board. We believe that our future success will depend upon the continued services of our senior management. Our business may be harmed by the loss of any member of our senior management, including Mr. Montrone or Mr. Meister. We do not maintain key-man life insurance with respect to Mr. Montrone or Mr. Meister. WE ARE SUBJECT TO ECONOMIC, POLITICAL AND OTHER RISKS ASSOCIATED WITH OUR SIGNIFICANT INTERNATIONAL SALES AND OPERATIONS We conduct international operations through a variety of wholly owned subsidiaries, majority-owned subsidiaries, joint ventures, equity investments and agents located in North and South America, Europe, the Far East, the Middle East and Africa. We are also exploring the possibility of expansion into other international markets. Expansion of these activities could increase the risks associated with our international operations. We derived approximately 20.0% of our total revenue from sales to customers located outside the United States in the first nine months of 2001 and in 2000. We anticipate that revenue from international operations will continue to represent a substantial portion of our total revenue. In addition, many of our manufacturing facilities, employees and suppliers are located outside the United States. Accordingly, our future results could be harmed by a variety of factors, including: - changes in the political or economic conditions in a country or region, particularly in developing or emerging markets; - longer payment cycles of foreign customers and difficulty of collecting receivables in foreign jurisdictions; - trade protection measures and import or export licensing requirements; - differing tax laws and changes in those laws; - difficulty in staffing and managing widespread operations; - differing labor laws and changes in those laws; - differing protection of intellectual property and changes in that protection; and - differing regulatory requirements and changes in those requirements. OUR INTERNATIONAL OPERATIONS EXPOSE US TO EXCHANGE RATE FLUCTUATIONS Approximately 20.0% of our revenues and expenses for the first nine months of 2001 were denominated in currencies other than the U.S. dollar. We own properties and conduct operations in Belgium, Canada, China, France, Germany, Japan, Hong Kong, Malaysia, Mexico, the Netherlands, Singapore, Switzerland and the United Kingdom. In 2000, fluctuations in the exchange rates between the U.S. dollar and other currencies reduced our net sales by approximately $40.1 million. Future fluctuations in exchange rates relative to the U.S. dollar could continue to harm our results of operations. SOME OF OUR EXISTING STOCKHOLDERS CAN EXERT CONTROL OVER US, AND THEY MAY NOT MAKE DECISIONS THAT REFLECT THE INTERESTS OF OUR OTHER STOCKHOLDERS Upon completion of this offering, a group of equity investors consisting of affiliates of Thomas H. Lee Partners, L.P., affiliates of Credit Suisse First Boston (USA) Inc., formerly known 8 as Donaldson, Lufkin & Jenrette, Inc., JP Morgan Partners (BHCA) L.P. and affiliates of Merrill Lynch & Co. will own 49.9% of our common stock, and Thomas H. Lee Equity Fund III, L.P. will own approximately 32.5% of our common stock. Accordingly, these investors have significant control over us and have the power to elect a majority of our directors, appoint new management and approve any action requiring the approval of the holders of our common stock, including adopting amendments to our certificate of incorporation and approving mergers or sales of substantially all of our assets, which may make it more difficult for a third party to acquire us. The interests of these equity investors may conflict with the interests of our other stockholders. These equity investors and members of our management have entered into an investors' agreement with us. This agreement provides that our Board of Directors will consist of at least nine, but not more than ten directors, three of whom may be appointed by the Thomas H. Lee Equity Fund III, L.P., one of whom will be appointed by THL FSI Equity Investors, L.P., one of whom may be appointed by DLJ Merchant Banking Partners II, L.P., one of whom will be Mr. Paul M. Montrone and one of whom will be Mr. Paul M. Meister. Our Board of Directors does not currently include a director appointed by DLJ Merchant Banking Partners II, L.P. The directors elected pursuant to the investors' agreement will have the authority to make decisions affecting our capital structure, including the issuance of additional capital stock, the implementation of stock repurchase programs and the declaration of dividends. OUR FAILURE TO MAINTAIN SATISFACTORY COMPLIANCE WITH THE FOOD AND DRUG ADMINISTRATION'S REGULATIONS AND THOSE OF OTHER GOVERNMENTAL AGENCIES MAY FORCE US TO RECALL PRODUCTS AND CEASE THEIR MANUFACTURE AND DISTRIBUTION Some of our operations are subject to regulation by the U.S. Food and Drug Administration and similar international agencies. These regulations govern a wide variety of product activities, from design and development to labeling, manufacturing, promotion, sales and distribution. If we fail to comply with the Food and Drug Administration's regulations or those of similar international agencies, we may have to recall products and cease their manufacture and distribution, which would harm our business. CHANGES IN THE HEALTHCARE INDUSTRY COULD HARM OUR BUSINESS In recent years, the healthcare industry has undergone significant changes in an effort to reduce costs. These changes include: - the development of large and sophisticated purchasing groups of pharmaceuticals and medical and surgical supplies; - wider implementation of managed care; - legislative healthcare reform; - consolidation of pharmaceutical and medical and surgical supply distributors; and - cuts in Medicare spending. We expect the healthcare industry to continue to change significantly in the future. Some of these potential changes, such as a reduction in governmental support of healthcare services or adverse changes in legislation or regulations governing the delivery or pricing of healthcare services or mandated benefits, may cause healthcare industry participants to purchase fewer of our products and services or to reduce the price that they are willing to pay for our products or services. 9 RISKS RELATING TO THIS OFFERING OUR STOCK PRICE MAY BE EXTREMELY VOLATILE Our stock price has been volatile in the past, due, in part, to low trading volume and the small percentage of our outstanding common stock held by public investors. Since January 1, 2000, our stock price has ranged from a low closing price of $20.06 per share to a high closing price of $49.63 per share. Our stock price may continue to be volatile based on general economic and market conditions. The market price of our common stock may also be affected by our ability to meet analysts' expectations. Failure to meet these expectations, even slightly, could cause the market price of our common stock to fall significantly. In the past, following periods of volatility in the market price of a company's securities, securities class action litigation has often been instituted against such a company. If similar litigation were instituted against us, it could result in substantial costs and a diversion of management's attention and resources, which could have an adverse effect on our business. FUTURE SALES OF COMMON STOCK BY OUR PRINCIPAL STOCKHOLDERS MAY CAUSE OUR STOCK PRICE TO DECLINE Upon completion of this offering, we will have 54,152,184 shares of common stock outstanding. Our principal equity investors, directors and executive officers will own of these shares. These stockholders will be free to sell those shares, subject to volume limitations of Rule 144 under the Securities Act, restrictions on transfer contained in our investors' agreement and the 90-day lock-up agreements that these investors will enter into with the underwriters. Some of these stockholders have registration rights under our investors' agreement. We cannot predict when these stockholders may sell their shares or in what volumes. However, the market price of our common stock could decline significantly if these stockholders sell a large number of shares into the public market after this offering or if the market believes that these sales may occur. 10 SPECIAL NOTE REGARDING FORWARD-LOOKING INFORMATION The Securities and Exchange Commission encourages companies to disclose forward-looking information so that investors can better understand a company's future prospects and make informed investment decisions. This prospectus contains these types of statements, which are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. We make these statements directly in this prospectus, and in the documents filed with the SEC that are incorporated by reference in this prospectus. Words such as "anticipates," "estimates," "expects," "projects," "intends," "plans," "believes" and words and terms of similar substance used in connection with any discussion of future operating results or financial performance identify forward-looking statements. All forward-looking statements reflect our present expectations of future events and are subject to a number of important factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The factors listed in the "Risk Factors" section of this prospectus, as well as any cautionary language in this prospectus, provide examples of these risks and uncertainties. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this prospectus or the date of the document incorporated by reference in this prospectus. We are under no obligation, and expressly disclaim any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise. For these statements, we claim the protection of the safe harbor for forward-looking statements contained in Section 27A of the Securities Act. USE OF PROCEEDS All of the shares of common stock offered hereby are being sold by the selling stockholders. We will not receive any proceeds from this offering. 11 PRICE RANGE OF COMMON STOCK Our common stock is listed on the New York Stock Exchange under the trading symbol FSH. The following table sets forth the high and low closing sale prices of our common stock, as reported by the New York Stock Exchange for each of the periods listed.
HIGH LOW ------ ------ 1999 First Quarter............................................. $20.06 $16.38 Second Quarter............................................ 22.31 16.88 Third Quarter............................................. 23.88 17.63 Fourth Quarter............................................ 43.00 22.50 2000 First Quarter............................................. 49.63 32.06 Second Quarter............................................ 43.25 24.73 Third Quarter............................................. 35.44 20.06 Fourth Quarter............................................ 45.19 34.06 2001 First Quarter............................................. 39.88 32.40 Second Quarter............................................ 38.70 24.70 Third Quarter............................................. 27.41 21.70 Fourth Quarter............................................ 30.30 24.20 2002 First Quarter (through January 17, 2002).................. 31.00 28.25
The last reported sale price of our common stock on the New York Stock Exchange on January 17, 2002 was $31.00 per share. As of January 15, 2002, we had approximately 132 holders of record of our common stock. DIVIDEND POLICY We have not paid a cash dividend during our last three fiscal years. Our bank credit agreement and other debt agreements restrict our ability to pay cash dividends. Accordingly, we do not anticipate paying cash dividends on our common stock at any time in the foreseeable future. 12 CAPITALIZATION The following table sets forth our cash and cash equivalents and our capitalization as of September 30, 2001. You should read this table along with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our financial statements and related notes incorporated by reference in this prospectus. The shares of common stock to be outstanding after this offering exclude: - 4,530,509 shares of common stock issuable upon the exercise of options outstanding as of September 30, 2001 under our 1998 stock option plan at a weighted average exercise price of $12.68 per share; - 2,583,315 shares of common stock issuable upon the exercise of warrants outstanding as of September 30, 2001 at a weighted average exercise price of $9.65 per share; - 3,142,967 shares of common stock issuable upon the exercise of options outstanding as of September 30, 2001 under our 2001 stock option plan at a weighted average exercise price of $26.14 per share; and - 4,791,033 shares of common stock reserved for future grants under our 2001 stock option plan.
AS OF SEPTEMBER 30, 2001 ------------- Cash and Cash Equivalents................................... $ 229.8 ======== Debt, including short term debt: Revolving credit facility(1).............................. $ -- Term facility............................................. 221.3 9% senior subordinated notes due 2008..................... 595.2 7 1/8% notes due 2005..................................... 149.4 Other..................................................... 80.1 -------- Total debt................................................ 1,046.0 -------- Stockholders' Equity: Preferred stock, par value $.01 per share, 15,000,000 shares authorized; no shares outstanding............... -- Common stock, par value $.01 per share, 500,000,000 shares authorized; 54,035,491 shares issued and 54,003,991 shares outstanding..................................... 0.5 Capital in excess of par value.............................. 656.3 Accumulated deficit......................................... (566.5) Other....................................................... (78.2) -------- Total stockholders' equity.................................. 12.1 -------- Total capitalization........................................ $1,058.1 ========
- --------------- (1) The $175.0 million revolving credit facility is available for working capital and general corporate purposes. At September 30, 2001, $51.4 million of this facility was utilized for letters of credit outstanding. 13 SELECTED FINANCIAL DATA You should read the selected financial data set forth below along with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our financial statements and related notes incorporated by reference in this prospectus. We have derived the selected statement of operations data for the years ended December 31, 2000, 1999, 1998, 1997 and 1996 and the selected balance sheet data as of December 31, 2000, 1999, 1998, 1997 and 1996 from our audited financial statements. We have derived the selected financial data for the nine months ended and as of September 30, 2001 and 2000 from our unaudited interim financial statements. We have prepared our unaudited interim financial statements on a basis consistent with our audited financial statements. In the opinion of our management, our unaudited financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of those statements. The results for any interim period are not necessarily indicative of the results for a full fiscal year.
NINE MONTHS ENDED SEPTEMBER 30, YEAR ENDED DECEMBER 31, ------------------- ---------------------------------------------------- 2001 2000 2000 1999 1998(1) 1997 1996 ---- ---- ---- ---- ------- ---- ---- (IN MILLIONS, EXCEPT PER SHARE DATA) STATEMENT OF OPERATIONS: Sales............................ $2,125.3 $1,977.6 $2,622.3 $2,514.5 $2,294.4 $2,213.7 $2,182.8 Cost of sales.................... 1,585.6 1,487.8 1,974.0 1,885.4 1,721.0 1,682.8 1,658.1 -------- -------- -------- -------- -------- -------- -------- Gross profit..................... 539.7 489.8 648.3 629.1 573.4 530.9 524.7 Selling, general and administrative expense......... 400.0 369.4 494.0 472.5 440.9 458.0 430.1 Restructuring and other charges (credits)(2)................... 51.6 (2.0) (2.0) (1.5) 23.6 51.8 -- Recapitalization-related costs(3)....................... -- -- -- -- 71.0 -- -- Loss from operations to be disposed of(4)................. -- -- -- 11.3 15.1 -- -- -------- -------- -------- -------- -------- -------- -------- Income from operations........... 88.1 122.4 156.3 146.8 22.8 21.1 94.6 Interest expense................. 74.9 75.0 99.1 104.2 90.3 23.0 27.1 Other (income) expense, net(5)... 1.6 (4.3) 19.4 (15.2) (7.2) 3.2 (0.1) -------- -------- -------- -------- -------- -------- -------- Income (loss) before income taxes.......................... 11.6 51.7 37.8 57.8 (60.3) (5.1) 67.6 Provision (benefit) for income taxes.......................... 6.2 20.7 15.1 34.4 (10.8) 25.4 30.8 -------- -------- -------- -------- -------- -------- -------- Net income (loss)................ $ 5.4 $ 31.0 $ 22.7 $ 23.4 $ (49.5) $ (30.5) $ 36.8 ======== ======== ======== ======== ======== ======== ======== Net income (loss) per common share: Basic.......................... $ 0.11 $ 0.77 $ 0.57 $ 0.59 $ (1.24) $ (0.30) $ 0.40 Diluted........................ $ 0.10 $ 0.70 $ 0.51 $ 0.55 $ (1.24) $ (0.30) $ 0.38 Weighted average common shares outstanding: Basic.......................... 47.8 40.1 40.1 40.0 40.0 101.5 91.5 Diluted........................ 51.6 44.3 44.4 42.8 40.0 101.5 102.5
14
NINE MONTHS ENDED SEPTEMBER 30, YEAR ENDED DECEMBER 31, ------------------- ---------------------------------------------------- 2001 2000 2000 1999 1998(1) 1997 1996 ---- ---- ---- ---- ------- ---- ---- (IN MILLIONS, EXCEPT PER SHARE DATA) OTHER FINANCIAL DATA: EBITDA(6)........................ $ 194.4 $ 174.0 $ 226.8 $ 223.9 $ 189.7 $ 155.4 $ 157.2 Depreciation and amortization(7)................ 55.3 43.4 58.1 58.5 50.7 47.0 44.6 Capital expenditures............. 23.8 18.7 29.4 41.1 67.2 59.2 40.7 Cash flows provided by (used in): Operating activities........... 77.8 51.8 107.2 124.7 149.9 46.1 49.0 Investing activities........... (196.8) (46.4) (57.1) (62.5) (231.8) (50.7) (42.0) Financing activities........... 282.7 (18.6) (32.8) (74.1) 129.3 (1.9) (46.0) BALANCE SHEET DATA: Working capital.................. $ 325.7 $ 146.4 $ 142.8 $ 115.3 $ 107.9 $ 237.5 $ 259.8 Total assets..................... 1,779.0 1,405.0 1,385.7 1,402.6 1,357.6 1,176.5 1,262.7 Long-term liabilities............ 1,193.6 1,210.0 1,189.6 1,213.7 1,229.1 474.5 483.5 Stockholders' equity (deficit)... 12.1 (317.1) (311.7) (330.6) (324.7) 347.1 386.2
- --------------- (1) On January 21, 1998, we were recapitalized in a transaction in which approximately 87% of our fully diluted shares of common stock were converted into the right to receive $9.65 per share in cash. In connection with this recapitalization, we entered into new debt financing arrangements. The recapitalization and debt financing arrangements are more fully described in Notes 2 and 12 to our audited financial statements incorporated by reference in this prospectus. (2) During the fourth quarter of 1997, we recorded $51.8 million of restructuring and other charges. These charges include costs associated with the closure of logistics and customer-service centers and related asset write-offs in the United States and internationally, the impairment of goodwill and property, plant and equipment related to certain international operations and the impairment of systems-related assets. During the fourth quarter of 1998, we recorded $23.6 million of restructuring and other charges. These charges include asset impairment charges in the United States and Asia and personnel reductions in the United States and Europe. (3) In connection with our recapitalization on January 21, 1998, we recorded $71.0 million of expenses consisting primarily of non-cash compensation expenses relating to the conversion of employee stock options, the implementation of certain executive severance agreements and the grant of options to certain executives in accordance with the terms of the recapitalization. (4) Loss from operations to be disposed of includes a $5.2 million write-off of in-process research and development costs associated with an acquisition in 1999, and a $2.6 million charge for restructuring and asset impairment costs in 1998. (5) Other (income) expense, net includes a $23.6 million charge for the write down of certain Internet-related investments in 2000 and $7.8 million of gains from asset sales in 1999. (6) We define "EBITDA" as net income plus income taxes, interest expense, depreciation and amortization. In calculating EBITDA, we exclude restructuring charges, recapitalization-related charges and other nonrecurring items. We use EBITDA here because we believe that it can assist you in comparing our performance to that of other companies on a consistent basis without regard to depreciation, amortization or one-time items. Depreciation and amortization can vary significantly among companies depending on accounting methods, particularly where acquisitions or non-operating factors including historical cost bases are involved. We believe that EBITDA as we define it is also useful because it enables you to compare our performance before the effect of various one-time items that do not directly 15 affect our operating performance. However, you should not consider EBITDA as an alternative to measures of financial performance determined in accordance with generally accepted accounting principles, such as net income as a measure of operating results or cash flows as a measure of liquidity. Our computation of EBITDA may not be comparable to similarly titled measures of other companies. It is also not the same computation of EBITDA that we make under our various debt agreements, which limit the amount of nonrecurring items that can be excluded in computing EBITDA for purposes of those agreements. (7) Excludes amortization of financing costs which is included in interest expense. 16 UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION The unaudited pro forma financial information set forth below includes our historical results for the periods presented. The unaudited pro forma financial information also includes the combined financial results for Cole-Parmer and Vista Properties, L.P., a special purpose entity not acquired by us, for the periods presented. We refer to Cole-Parmer and Vista collectively as the C-P Entities. On November 5, 2001, we acquired Cole-Parmer in a cash transaction for a total purchase price of approximately $208.5 million, net of cash acquired. We financed the acquisition using cash available from our public offering in May 2001 and from the sale of accounts receivable through our receivables securitization facility. The unaudited pro forma combined balance sheet as of September 30, 2001 set forth below gives effect to our acquisition of Cole-Parmer, as if the transaction had occurred on September 30, 2001. We accounted for the acquisition in accordance with Statement of Financial Accounting Standards No. 141, "Business Combinations" ("SFAS 141"). We have not reflected estimates of acquisition liabilities relating to the integration of Cole-Parmer with our operations in the unaudited pro forma combined balance sheet. The unaudited pro forma combined statements of operations for the nine months ended September 30, 2001 and for the year ended December 31, 2000 set forth below give effect to the acquisition, as if the transaction had occurred on January 1, 2000. We have not reflected potential cost savings from combining the operations in the unaudited pro forma combined statements of operations as there can be no assurance that any such cost savings will occur. Additionally, we have not reflected anticipated costs to integrate the operations and charges due to an estimated fair value increase to inventory in the unaudited pro forma combined statements of operations. The unaudited pro forma adjustments are based upon available information and upon certain assumptions that we believe are reasonable. All information and financial data concerning Cole-Parmer included in the unaudited pro forma financial information has been provided to us by Cole-Parmer. The unaudited pro forma financial information is provided for informational purposes only and does not purport to be indicative of our results of operations or financial positions that would actually have been achieved had the acquisition been completed as of or for the periods presented, or that may be obtained in the future. You should read the pro forma financial information in conjunction with our audited and unaudited historical financial statements and related notes previously reported on Form 10-K and Form 10-Q, and of the C-P Entities and related notes previously reported on Form 8-K/A, and incorporated by reference in this prospectus. 17 UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS NINE MONTHS ENDED SEPTEMBER 30, 2001
HISTORICAL HISTORICAL C-P PRO FORMA PRO FORMA FISHER ENTITIES ADJUSTMENTS COMBINED ---------- ---------- ----------- --------- (IN MILLIONS, EXCEPT PER SHARE DATA) Sales........................................ $2,125.3 $134.6 $(3.7)(a) $2,256.2 Cost of sales................................ 1,585.6 76.3 (3.7)(a) 1,658.2 Selling, general and administrative expense.................................... 400.0 45.2 2.4(b) 447.6 Restructuring and other charges.............. 51.6 -- -- 51.6 -------- ------ ----- -------- Income from operations....................... 88.1 13.1 (2.4) 98.8 Interest expense............................. 74.9 0.5 1.3(c) 76.7 Other (income) expense, net.................. 1.6 (0.2) 5.5(c) 6.9 -------- ------ ----- -------- Income before income taxes................... 11.6 12.8 (9.2) 15.2 Income tax provision......................... 6.2 0.7 0.2(d) 7.1 -------- ------ ----- -------- Net income................................... $ 5.4 $ 12.1 $(9.4) $ 8.1 ======== ====== ===== ======== Net income per common share: Basic...................................... $ 0.11 $ 0.17 ======== ======== Diluted.................................... $ 0.10 $ 0.16 ======== ======== Weighted average common shares outstanding: Basic...................................... 47.8 47.8 ======== ======== Diluted.................................... 51.6 51.6 ======== ========
See accompanying notes to unaudited pro forma combined financial information 18 UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 2000
HISTORICAL HISTORICAL C-P PRO FORMA PRO FORMA FISHER ENTITIES ADJUSTMENTS COMBINED ---------- ---------- ----------- --------- (IN MILLIONS, EXCEPT PER SHARE DATA) Sales........................................ $2,622.3 $176.1 $ (4.4)(a) $2,794.0 Cost of sales................................ 1,974.0 99.9 (4.4)(a) 2,069.5 Selling, general and administrative expense.................................... 494.0 55.6 3.1(b) 552.7 Restructuring and other charges (credits).... (2.0) -- -- (2.0) -------- ------ ------ -------- Income from operations....................... 156.3 20.6 (3.1) 173.8 Interest expense............................. 99.1 0.1 3.2(c) 102.4 Other (income) expense, net.................. 19.4 (0.1) 9.5(c) 28.8 -------- ------ ------ -------- Income before income taxes................... 37.8 20.6 (15.8) 42.6 Income tax provision......................... 15.1 0.8 0.3(d) 16.2 -------- ------ ------ -------- Net income................................... $ 22.7 $ 19.8 $(16.1) $ 26.4 ======== ====== ====== ======== Net income per common share: Basic...................................... $ 0.57 $ 0.66 ======== ======== Diluted.................................... $ 0.51 $ 0.59 ======== ======== Weighted average common shares outstanding: Basic...................................... 40.1 40.1 ======== ======== Diluted.................................... 44.4 44.4 ======== ========
See accompanying notes to unaudited pro forma combined financial information 19 UNAUDITED PRO FORMA COMBINED BALANCE SHEET SEPTEMBER 30, 2001
HISTORICAL HISTORICAL C-P PRO FORMA PRO FORMA FISHER ENTITIES ADJUSTMENTS COMBINED ---------- ---------- ----------- --------- (IN MILLIONS) ASSETS Current Assets: Cash and cash equivalents................... $ 229.8 $ 5.6 $(161.9)(f) $ 73.5 Receivables, net............................ 344.0 21.5 (50.5)(e,f) 315.0 Inventories................................. 248.2 19.9 13.3(h) 281.4 Other current assets........................ 77.0 7.8 -- 84.8 -------- ------ ------- -------- Total current assets..................... 899.0 54.8 (199.1) 754.7 Property, plant and equipment............... 305.8 22.1 (7.1)(g,h) 320.8 Goodwill.................................... 406.7 9.7 70.2(h) 486.6 Other assets................................ 167.5 8.9 61.1(g,h) 237.5 -------- ------ ------- -------- Total assets............................. $1,779.0 $ 95.5 $ (74.9) $1,799.6 ======== ====== ======= ======== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Short-term debt............................. $ 71.1 $ 1.2 $ (0.8)(g) $ 71.5 Accounts payable............................ 328.0 9.9 (0.5)(e) 337.4 Accrued and other current liabilities....... 174.2 4.3 5.6(f) 184.1 -------- ------ ------- -------- Total current liabilities................ 573.3 15.4 4.3 593.0 Long-term debt................................ 974.9 11.1 (11.1)(g) 974.9 Other liabilities............................. 218.7 0.9 -- 219.6 -------- ------ ------- -------- Total liabilities........................ 1,766.9 27.4 (6.8) 1,787.5 -------- ------ ------- -------- Commitments and contingencies Stockholders' equity: Common stock................................ 0.5 0.7 (0.7)(h) 0.5 Capital in excess of par value.............. 656.3 1.5 (1.5)(h) 656.3 Retained earnings (accumulated deficit)..... (566.5) 83.4 (83.4)(h) (566.5) Accumulated other comprehensive loss........ (77.2) -- -- (77.2) Treasury stock, at cost..................... (1.0) (17.5) 17.5(h) (1.0) -------- ------ ------- -------- Total stockholders' equity............... 12.1 68.1 (68.1) 12.1 -------- ------ ------- -------- Total liabilities and stockholders' equity................................. $1,779.0 $ 95.5 $ (74.9) $1,799.6 ======== ====== ======= ========
See accompanying notes to unaudited pro forma combined financial information 20 NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION NOTE 1 -- BASIS OF PRESENTATION The unaudited pro forma financial information set forth above includes our historical results for the periods presented. The unaudited pro forma financial information also includes the combined financial results for the C-P Entities for the periods presented. On November 5, 2001, we acquired Cole-Parmer in a cash transaction for a total purchase price of approximately $208.5 million, net of cash acquired. We financed the acquisition using cash available from our public offering in May 2001 and from the sale of accounts receivable through our receivables securitization facility. The unaudited pro forma combined statement of operations for the nine months ended September 30, 2001 gives effect to the transaction as if it had occurred on January 1, 2000. Our fiscal year ends on December 31, and the fiscal year of the C-P Entities ended on March 31. The historical results of the C-P Entities for the nine months ended September 30, 2001 include the C-P Entities' results for the three months ended March 31, 2001 of its fiscal year then ended and the six months ended September 30, 2001. The unaudited pro forma combined statement of operations for the year ended December 31, 2000 gives effect to the transaction as if it had occurred on January 1, 2000. The unaudited pro forma combined balance sheet gives effect to the transaction as if it had occurred on September 30, 2001. The unaudited pro forma financial information includes certain pro forma adjustments as discussed below in Note 2. The unaudited pro forma financial information does not purport to be indicative of our results of operations or financial position that would actually have been achieved had the acquisition been completed as of or for the periods presented, or that may be obtained in the future. You should read the unaudited pro forma financial information in conjunction with the audited and unaudited historical financial statements of us and the C-P Entities referred to above. NOTE 2 -- UNAUDITED PRO FORMA ADJUSTMENTS (a) Represents the elimination of sales and cost of sales for transactions between us and Cole-Parmer for the periods presented. (b) Included in the $2.4 million and $3.1 million of pro forma adjustments to selling, general and administrative expense for the nine months ended September 30, 2001 and for the year ended December 31, 2000, respectively, are the following: - An adjustment to eliminate depreciation expense of Vista of $0.2 million and $0.3 million for the nine months ended September 30, 2001 and for the year ended December 31, 2000, respectively. - An adjustment to record approximately $1.3 million and $1.7 million of rent expense for lease payments to Vista for the nine months ended September 30, 2001 and for the year ended December 31, 2000, respectively. In connection with the acquisition, we entered into a lease agreement with Vista for the facility located in Vernon Hills, Illinois. - An adjustment to amortize identifiable intangible assets with finite useful lives and depreciate fair value adjustments to fixed assets over periods ranging from 3 to 24 years for intangible assets and 1 to 15 years for fixed assets. The depreciation and amortization expense adjustment was $1.3 million and $1.7 million for the nine months ended September 30, 2001 and for the year ended December 31, 2000, respectively. Goodwill and intangible assets related to this transaction have been accounted for in accordance with Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets" ("SFAS 142"). SFAS 142 provides for the nonamortization of goodwill and other indefinite lived intangible assets. Accordingly, the unaudited 21 NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION -- (CONTINUED) pro forma adjustments do not include amortization of goodwill and indefinite lived intangible assets. (c) Represents an adjustment for the financing of the purchase price of $208.5 million funded through the sale of $50.0 million in receivables under our receivable securitization facility and existing cash on hand. The loss on the sale of receivables, which is included in interest expense, was calculated based on an implied rate of 4.4% and 6.3% for the nine months ended September 30, 2001 and for the year ended December 31, 2000, respectively. The foregone interest income was calculated based on a 4.6% and 6.0% interest rate for the nine months ended September 30, 2001 and for the year ended December 31, 2000, respectively. (d) Represents an adjustment for the tax effect on the Cole-Parmer historical financial results and related unaudited pro forma adjustments at the combined U.S. federal and state statutory tax rate of 37%. The tax effect of the remaining unaudited pro forma adjustments has been calculated using our effective tax rate of 40%. Because Cole-Parmer was organized as a Subchapter S corporation, its historical statements make no provisions for federal income taxes and for certain state income taxes where a Subchapter S election has been made. (e) Represents an adjustment to eliminate accounts receivables and accounts payable between us and Cole-Parmer at September 30, 2001. (f) Represents an adjustment to reflect the funding of the purchase price as we used available cash of $161.8 million from our public offering in May 2001 and $50.0 million from the sale of accounts receivable through our receivables securitization facility. The unaudited pro forma adjustment also reflects $0.1 million of cash for Vista, which was not acquired as part of the transaction. The pro forma combined balance sheet also reflects $5.6 million of accrued transaction costs. (g) Represents an adjustment to eliminate assets and liabilities not acquired by us, including $4.8 million cash surrender value for certain executive life insurance policies, certain debt obligations and Vista that held net property of $14.4 million and debt obligations of $11.4 million. (h) Represents an adjustment to allocate excess purchase price over the book value of the net assets acquired of $156.7 million, including fair value adjustments for inventory, property, plant and equipment intangible assets and goodwill. The allocation of purchase price has been made based upon management estimates and third party valuations that have not been finalized. Accordingly, the allocation of purchase price is preliminary. NOTE 3 -- UNAUDITED PRO FORMA EARNINGS PER SHARE Unaudited pro forma earnings per share is computed in accordance with Statement of Financial Accounting Standards No. 128, "Earnings Per Share". Unaudited pro forma basic net income per share is computed by dividing pro forma net income by our historical weighted average number of shares of common stock outstanding during the period. Unaudited pro forma diluted net income per share is computed by dividing pro forma net income by our historical weighted average number of shares of common stock outstanding during the period, including potential common shares from conversion of stock options and warrants using the treasury stock method, if dilutive. 22 NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION -- (CONTINUED) The following table sets forth unaudited pro forma basic and diluted net income per share computational data for the periods presented (in millions, except per share amounts):
NINE MONTHS ENDED YEAR ENDED SEPTEMBER 30, DECEMBER 31, 2001 2000 ------------- ------------ Unaudited pro forma net income........................... $ 8.1 $26.4 ===== ===== Weighted average shares of common stock outstanding used in the computation of basic earnings per share......... 47.8 40.1 Common stock equivalents(a).............................. 3.8 4.3 ----- ----- Shares used in the computation of diluted earnings per share.................................................. 51.6 44.4 ===== ===== Unaudited pro forma basic net income per share........... $0.17 $0.66 ===== ===== Unaudited pro forma diluted net income per share......... $0.16 $0.59 ===== =====
- --------------- (a) The amount of outstanding antidilutive common stock options and warrants excluded from the computation of unaudited pro forma diluted net income per share for the nine months ended September 30, 2001 and for the year ended December 31, 2000 was 0.9 million and 0.2 million, respectively. The unaudited pro forma basic and diluted net income per share does not purport to be indicative of our basic and diluted earnings per share that would actually have been achieved had the transaction been completed for the periods presented, or that may be obtained in the future. 23 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OVERVIEW We report our financial results on the basis of three business segments: domestic distribution, international distribution and laboratory workstations. The domestic and international distribution segments engage in the supply, marketing, service and manufacture of scientific, clinical, educational, and occupational health and safety products. The laboratory workstations segment manufactures laboratory workstations, fume hoods and enclosures for technology and communication centers. Until 1999, we operated a fourth segment, technology, which we disposed of through the spinoff of ProcureNet, our former outsourcing and supply chain management technology business, in April 1999 and the sale of our UniKix Technology software business in July 1999. In December 1998, we acquired 90% of Bioblock Scientific S.A., a leading distributor of scientific and laboratory instrumentation in France. We acquired the remaining 10% of Bioblock in the first quarter of 1999. From 1998 to 2000, we made other smaller acquisitions of laboratory product distributors and other businesses. In the first nine months of 2001, our acquisitions included: - our February 2001 acquisition of the pharmaceutical packaging services business of Covance, Inc., which we renamed Fisher Clinical Services; - our June 2001 acquisition of a controlling interest in Medical Analysis Systems, Inc, after having made an initial investment in March 2001; and - our July 2001 acquisition of Safety Equipment Company, a distributor of safety supplies and personal protection equipment. The purchase price for Fisher Clinical Services, after adjustments, was $132.7 million, which we financed through the sale of receivables under our receivables securitization facility. The aggregate purchase price for Medical Analysis Systems and Safety Equipment Company was $31.2 million. We have accounted for all of our acquisitions as purchases, with the operations of the acquired companies and businesses included in our financial statements from the dates of acquisition. RECENT DEVELOPMENTS In November 2001, we acquired Cole-Parmer for a cash purchase price of approximately $208.5 million, net of cash acquired. Cole-Parmer is a leading worldwide manufacturer and distributor of specialty technical instruments, appliances, equipment and supplies. We financed the acquisition from the proceeds of our public offering in May 2001 and the sale of receivables under our receivables securitization facility. We will include the results of Cole-Parmer in our domestic distribution segment. During the fourth quarter of 2001, we commenced implementation of a plan focused on further integration of our international operations and recent acquisitions and the continued streamlining of our domestic operations, including the consolidation of certain distribution centers. The principal elements of this plan are the reduction of our workforce by approximately 3% and the consolidation of international sales and distribution facilities. We estimate that the total costs associated with this plan will be approximately $10.9 million. We expect to record a restructuring charge of $9.5 million in the fourth quarter of 2001 in connection with the restructuring plan. Upon completion of this plan, we expect a reduction of approximately $6.0 million in annual pre-tax expenses. Of this amount, we intend to reinvest approximately 24 $3.0 million in our sales and marketing efforts and distribution capabilities surrounding our chemical and life sciences product portfolio. As a net result, we expect to realize annual savings of $3.0 million beginning in 2002. RESULTS OF OPERATIONS The following table sets forth our sales and income (loss) from operations by segment (in millions):
NINE MONTHS ENDED SEPTEMBER 30, YEAR ENDED DECEMBER 31, --------------------- ------------------------------ 2001 2000 2000 1999 1998 ---- ---- ---- ---- ---- SALES: Domestic distribution....... $1,795.8 $1,653.0 $2,164.0 $1,992.9 $1,864.7 International distribution.............. 320.2 316.4 451.0 478.8 421.1 Laboratory workstations..... 132.1 122.1 156.0 182.6 151.7 Technology.................. -- -- -- -- -- -------- -------- -------- -------- -------- Segment sub-total...... 2,248.1 2,091.5 2,771.0 2,654.3 2,437.5 Eliminations................ (122.8) (113.9) (148.7) (139.8) (143.1) -------- -------- -------- -------- -------- Totals...................... $2,125.3 $1,977.6 $2,622.3 $2,514.5 $2,294.4 ======== ======== ======== ======== ======== INCOME (LOSS) FROM OPERATIONS: Domestic distribution....... $ 128.5 $ 116.7 $ 140.5 $ 123.5 $ 113.2 International distribution.............. 9.2 7.1 9.7 7.8 (1.5) Laboratory workstations..... 3.3 2.9 4.2 24.7 21.0 Technology.................. -- -- -- (11.3) (15.1) -------- -------- -------- -------- -------- Segment sub-total...... 141.0 126.7 154.4 144.7 117.6 Recapitalization-related costs..................... -- -- -- -- (71.0) Restructuring and other (charges) credits......... (52.7)(a) (3.5) 2.0 1.5 (23.6) Eliminations................ (0.2) (0.8) (0.1) 0.6 (0.2) -------- -------- -------- -------- -------- Totals...................... $ 88.1 $ 122.4 $ 156.3 $ 146.8 $ 22.8 ======== ======== ======== ======== ========
- --------------- (a) The domestic distribution, international distribution and laboratory workstations segments accounted for $15.4 million, $2.6 million and $0.1 million, respectively, of the 2001 restructuring charge taken in the first quarter of 2001. The domestic distribution segment incurred a $1.1 million inventory write-off to cost of sales in the first quarter related to the restructuring. In addition, we accelerated the vesting of common stock options and recorded a primarily non-cash compensation charge of $33.5 million in the first quarter. NINE MONTHS ENDED SEPTEMBER 30, 2001 COMPARED WITH THE NINE MONTHS ENDED SEPTEMBER 30, 2000 Sales. Sales for the nine months ended September 30, 2001 increased 7.5% to $2,125.3 million from $1,977.6 million for the comparable period in 2000. Excluding foreign exchange effects, sales increased to $2,144.0 million for the nine months ended September 30, 2001, an increase of 8.4% from the corresponding period in 2000. For the nine months ended September 30, 2001, sales in the domestic distribution segment increased 8.6% to $1,795.8 million. The increase is attributable to growth in the pharmaceutical 25 and biotechnology markets and the impact of acquisitions, primarily our February 2001 acquisition of Fisher Clinical Services. We expect annual revenue growth for the domestic distribution segment, including the results of Cole-Parmer which was acquired on November 5, 2001 of 10% to 11% for 2001. Excluding foreign exchange effects, international distribution sales increased to $336.8 million for the nine months ended September 30, 2001, an increase of 6.4% from the corresponding period. We expect annual revenue growth of approximately 4% for the international distribution segment, excluding the impact of foreign exchange. In the laboratory workstation segment, sales grew to $132.1 million for the nine months ended September 30, 2001, an increase of 8.2% from the corresponding period in 2000. The growth is primarily attributable to increased sales volume and improved order activity. We expect annual sales growth for the laboratory workstation segment of approximately 7.5% for 2001. Gross profit. Our gross profit for the nine months ended September 30, 2001, increased to $539.7 million, an increase of 10.2% from the corresponding period in 2000. Gross profit as a percentage of sales increased to 25.4% for the nine months ended September 30, 2001, from 24.8% for the comparable period in 2000. The increase in gross profit as a percentage of sales was primarily due to acquisitions during the year. Selling, general and administrative expense. Selling, general and administrative expense for the nine months ended September 30, 2001 increased to $400.0 million, an increase of 8.3% from the corresponding period in 2000. Excluding nonrecurring costs of $5.5 million in the nine months ended September 30, 2000, selling, general and administrative expense as a percentage of sales was 18.8% for the nine months ended September 30, 2001 compared with 18.4% for the comparable period a year ago. The increase in selling, general and administrative expense as a percentage of sales is primarily due to the effect of acquisitions during the year. Restructuring and other charges. During the first quarter of 2001, we adopted and commenced implementation of a streamlining plan aimed at improving our operations, largely through office, warehouse and manufacturing facility consolidations and the discontinuance of certain product lines. We recorded a restructuring charge of $18.1 million in the first quarter of 2001. Upon adoption of the streamlining plan, we anticipated incurring approximately an additional $7.0 million of nonrecurring expenses related to the plan, of which we have incurred $5.6 million for the nine months ended September 30, 2001. The restructuring charge consisted of $10.9 million in accruals for employee termination and other severance costs associated with the termination of the employment of approximately 500 salaried and hourly employees as part of the streamlining plan and $7.2 million of exit costs relating primarily to lease cancellation costs and costs associated with the discontinuation of certain product lines. As of September 30, 2001, we have spent $8.2 million of the $18.1 million accrued. In addition, in March 2001, we accelerated the vesting of options to purchase approximately 2.3 million shares of common stock having an average exercise price of $20.85 per share. These options were then converted into the right to receive approximately 1.0 million shares of common stock, which were issued and deposited into a "rabbi trust." The number of shares issued was determined by dividing the "spread" value of the option (the difference between the last reported sale price on March 30, 2001 of $35.44 and the exercise price of the option) by $35.44. As a result of these transactions, we recorded a primarily non-cash compensation charge of $33.5 million during the first quarter of 2001. Income from operations. Income from operations for the nine months ended September 30, 2001, decreased to $88.1 million from $122.4 million for the comparable period in 2000. Excluding restructuring and other charges of $52.7 million and $3.5 million for the nine months ended 26 September 30, 2001 and 2000, respectively, income from operations increased 11.8% to $140.8 million from $125.9 million for the comparable period a year ago. Income from operations for the domestic distribution segment increased 10.1% to $128.5 million for the nine months ended September 30, 2001. We expect income from operations as a percentage of sales for our domestic distribution segment to be approximately 7.1% for 2001. Income from operations for the international distribution segment increased 29.6% to $9.2 million for the nine months ended September 30, 2001. We expect the international distribution segment income from operations as a percentage of sales to increase to approximately 3.2% for 2001. Income from operations for the laboratory workstations segment increased to $3.3 million from $2.9 million for the nine months ended September 30, 2001. We expect income from operations as a percentage of sales for the laboratory workstations segment to be approximately 2.7% for 2001. Other (income) expense, net. Other (income) expense, net totaled $1.6 million of expense for the nine months ended September 30, 2001, compared with $4.3 million of income for the comparable period in 2000. The increase in other expense for the 2001 period was primarily due to our equity in the losses of unconsolidated affiliates, HealthNexis, formerly The New Health Exchange, and MAS, prior to acquiring a controlling interest. The losses totaled $5.1 million for the nine months ended September 30, 2001, compared with $0.4 million in the prior year. We expect the equity losses in HealthNexis to continue for the remainder of the year. Income tax provision. For the nine months ended September 30, 2001, we recorded an income tax provision of $6.2 million compared with a $20.7 million income tax provision for the corresponding period in 2000. The effective income tax rate for the nine months ended September 30, 2001 was 53% compared with 40% for the corresponding period in 2000. The higher effective tax rate for the nine months ended September 30, 2001 resulted from the restructuring and stock compensation charges taken in the first quarter of 2001 having a U.S. tax benefit of only 37%. For the fourth quarter of 2001, we anticipate that our effective tax rate will be approximately 40%. 2000 AS COMPARED WITH 1999 Sales. Sales for the year ended December 31, 2000 increased 4.3% to $2,622.3 million from $2,514.5 million in 1999. Excluding the impact of foreign exchange, sales increased 5.9% for the year ended December 31, 2000. Sales growth in the domestic distribution segment was primarily due to internal sales growth. Sales decline in the international distribution segment was due entirely to weaker foreign currencies, primarily the euro, in 2000 compared to 1999. Excluding the $35.1 million negative impact of changes in foreign exchange rates, international distribution sales grew by 1.5% for the year ended December 31, 2000. Sales decline in the laboratory workstations segment was due primarily to a slowdown in the industrial research laboratory construction market. Gross profit. Gross profit for the year ended December 31, 2000 increased 3.1% to $648.3 million from $629.1 million in 1999. This increase resulted primarily from higher volume, which was partially offset by a decrease in gross profit margins. Gross profit as a percentage of sales decreased to 24.7% for the year ended December 31, 2000 from 25.0% in 1999. The reduction in gross profit as a percentage of sales was primarily due to a decline in sales in the laboratory workstations segment, coupled with a change in product mix. Gross profit in 1999 was negatively affected by a $5.3 million inventory write-off as a result of a change in our product portfolio. Selling, general and administrative expense. Selling, general and administrative expense for the year ended December 31, 2000 increased 4.6% to $494.0 million from $472.5 million in 1999. The increase in selling, general and administrative expense in 2000 was primarily due to increased sales volume. Selling, general and administrative expense for the year ended 27 December 31, 2000 includes $10.4 million of nonrecurring costs consisting of $5.5 million of costs incurred by the domestic distribution segment for business combinations that were not consummated, $3.7 million of non-cash compensation expense relating to a one-time change in the terms of certain stock options, and $1.2 million of expenses related to targeted workforce reductions. For the year ended December 31, 1999, selling, general and administrative expense included $2.2 million of nonrecurring costs associated with our long-term restructuring plans. Excluding these nonrecurring costs, selling, general and administrative expense as a percentage of sales decreased to 18.4% for the year ended December 31, 2000 compared with 18.7% in 1999. Restructuring and other charges. In the third quarter of 2000, we recorded a restructuring credit of $2.0 million, which consisted of a $0.7 million reversal of the restructuring charge recorded in 1999 due to revised estimates of severance and related obligations and a $1.3 million reversal of restructuring charges recorded in years prior to 1999 due to revised estimates. In the fourth quarter of 1999, we recorded a $1.5 million net restructuring credit, which consisted of a $2.1 million restructuring charge related to our long-term restructuring plan and a $3.6 million reversal of prior period restructuring charges due to revised estimates. The 1999 restructuring charge reflected consolidation and downsizing of our German operations, which are included in our international distribution segment. This charge resulted from a plan that was adopted in December 1999. The charge related to severance and related costs for the termination of approximately 22 warehouse, customer service and sales employees. This plan was substantially complete at December 31, 2000 and the remaining accrual of $0.4 million is expected to be fully expended during 2001. The $3.6 million reversal of prior period restructuring charges consists of a $3.0 million reduction of severance due to organizational changes and voluntary separations that occurred during 1999 which were not anticipated in prior periods and a $0.6 million reduction due to revised estimates for the closing of logistics centers in the United States. Income from operations. Income from operations for the year ended December 31, 2000 increased to $156.3 million from $146.8 million in 1999, primarily for the reasons discussed above. Excluding restructuring and other nonrecurring costs of $8.4 million in 2000 and $11.2 million in 1999, income from operations increased to $164.7 million in 2000 from $158.0 million in 1999. Interest expense. Interest expense for the year ended December 31, 2000 decreased to $99.1 million from $104.2 million in 1999. The decrease was primarily the result of a reduction in the amount of receivables sold under our receivables securitization facility during 2000 and favorable rate fluctuations on our interest rate swap agreements. Other (income) expense, net. Other (income) expense, net for the year ended December 31, 2000 decreased to $19.4 million of expense from $15.2 million of income in 1999. We recorded a charge of $23.6 million in the fourth quarter of 2000 related to the write-down to fair market value of investments in certain Internet-related ventures. The majority of this charge related to our investment in ProcureNet, which we spun off in April 1999. The charge was triggered primarily by market conditions that adversely impacted ProcureNet's cash flows. The 1999 period includes a gain on the sale of the UniKix Technology software business, gains from the sale of property, plant and equipment and a gain from the undesignated portion of our interest rate swap. Income tax provision. The income tax provision for the year ended December 31, 2000 decreased to $15.1 million from $34.4 million in 1999. The effective tax rate was 40.0% for 2000 compared with 59.5% for 1999. The decrease in the effective tax rate in 2000 is primarily due to the implementation of domestic and international tax planning initiatives and a reduction in foreign losses for which no tax benefits are recorded. Net income. Net income for the year ended December 31, 2000 decreased to $22.7 million from $23.4 million in 1999 for the reasons discussed above. 28 1999 AS COMPARED WITH 1998 Sales. Sales for the year ended December 31, 1999 increased 9.6% to $2,514.5 million from $2,294.4 million in 1998. Sales growth in the domestic distribution and laboratory workstations segments in 1999 was primarily due to internal sales growth as well as the inclusion of sales of companies acquired in the second half of 1998 and the first quarter of 1999. Sales growth in the international distribution segment was predominantly due to the inclusion of sales of acquired companies. Gross profit. Gross profit for the year ended December 31, 1999 increased 9.7% to $629.1 million from $573.4 million in 1998, primarily as a result of increased sales volume. Gross profit as a percentage of sales was 25.0% in 1999 and 1998. Gross profit in 1999 was negatively affected by a $5.3 million inventory write-off as a result of a change in our product portfolio. Gross profit in 1998 was negatively affected by $2.7 million of charges for adjustments of certain domestic and international inventory reserves related to the 1998 restructuring charge discussed below. Gross profit, excluding these charges, increased to 25.2% of sales in 1999 from 25.1% in 1998. Selling, general and administrative expense. Selling, general and administrative expense for the year ended December 31, 1999 increased 7.2% to $472.5 million from $440.9 million in 1998. The increase in selling, general and administrative expense in 1999 was primarily due to the selling, general and administrative expense of companies acquired during the second half of 1998 and the first quarter of 1999 and increased sales volume. Selling, general and administrative expense in both periods includes nonrecurring costs associated with the temporary duplication of operations, relocation of inventories and employees, hiring and training new employees, and other nonrecurring costs associated with our long-term restructuring plans and management retention payments related to our recapitalization. For 1999, $2.2 million of these costs were included in selling, general and administrative expense compared with $7.6 million in 1998. Excluding these nonrecurring costs, selling, general and administrative expense as a percentage of sales was 18.7% in 1999 and 18.9% in 1998. Recapitalization-related costs. During the first quarter of 1998, we recorded $71.0 million of expenses consisting primarily of non-cash compensation expense relating to the conversion of employee stock options, the implementation of certain executive severance agreements and the grant of options to certain executives in accordance with the terms of our recapitalization. Restructuring and other charges. In the fourth quarter of 1998, we recorded $23.6 million of restructuring and other charges, which included $26.5 million of charges related to our long-term restructuring plan and $2.9 million of reversals for adjustments to prior period restructuring charges due to revised estimates. In 1998, restructuring and other charges included international asset impairment charges attributable to the economic slowdown in the Far East, write-offs of information systems due to a change in management's global information system strategy, and employee separation and other exit costs due to a restructuring of our management team in the United States and Europe and selected components of our sales force. These charges consisted of $13.6 million related to non-cash asset impairments, $12.0 million of accruals for employee separation arrangements and $0.9 million of exit costs. The 1998 restructuring plan was substantially completed during 1999. The remaining accruals of $1.1 million for long-term severance arrangements are expected to be expended during 2001. Loss from operations to be disposed of. In December 1998 our Board of Directors approved a plan to dispose of our technology business segment. The disposition was completed through the spinoff of ProcureNet in April 1999 and the sale of the UniKix Technology software business in July 1999. The results of operations of this segment are reported separately in our statement of operations. Loss from operations to be disposed of decreased to $11.3 million for the year ended December 31, 1999 from $15.1 million in 1998. The decrease was primarily due to a decrease in the operating losses of ProcureNet and the UniKix Technology software business 29 during 1999 due to their dispositions. The 1999 period includes a $5.2 million write-off of in-process research and development costs associated with an acquisition made during the first quarter of 1999, while the 1998 period includes $3.5 million of restructuring and other nonrecurring costs. Income from operations. Income from operations for the year ended December 31, 1999 increased to $146.8 million from $22.8 million in 1998, primarily for the reasons discussed above. Excluding recapitalization-related, restructuring and other charges and nonrecurring costs of $11.2 million in 1999 and $108.4 million in 1998, income from operations for 1999 increased to $158.0 million from $131.2 million in 1998. Interest expense. Interest expense for the year ended December 31, 1999 increased to $104.2 million from $90.3 million in 1998. The increase was primarily the result of a full year of interest expense in 1999 resulting from the January 1998 recapitalization and additional indebtedness resulting from our issuance of $200.0 million principal amount of 9% Senior Subordinated Notes in November 1998, both partially offset by one-time charges of $6.5 million in the first quarter of 1998 related to the consummation of the recapitalization. Other (income) expense, net. Other (income) expense, net for the year ended December 31, 1999 increased to $15.2 million of income from $7.2 million of income in 1998. The increase in income in 1999 was primarily due to a gain on the sale of the UniKix Technology software business, gains from the sale of property, plant and equipment associated with our consolidation plans and a gain from the undesignated portion of our interest rate swap. Income tax provision (benefit). The income tax provision (benefit) was $34.4 million for the year ended December 31, 1999 compared with $(10.8) million in 1998. The effective tax rate was 59.5% for 1999. Excluding the $71.0 million of recapitalization related costs, of which a portion was nondeductible, the effective tax rate for 1998 was 152.7%. The decrease in the effective tax rate was due to reductions in foreign losses for which no tax benefits are recognized and the restructuring of foreign operations to permit the recognition of tax benefits on losses. Net income (loss). Net income for the year ended December 31, 1999 increased to $23.4 million from a loss of $49.5 million in 1998 for the reasons discussed above. LIQUIDITY AND CAPITAL RESOURCES During the nine months ended September 30, 2001, our operations provided $77.8 million of cash compared with $51.8 million of cash for the same period in 2000. This change in cash provided by operating activities is primarily due to an increase in net income adjusted for non-cash items. For the year ended December 31, 2000, our operations generated $107.2 million of cash compared with $124.7 million for 1999. The decrease in cash generated from operations in 2000 is primarily due to increased investments in working capital, partially offset by an increase in cash generated from net income, adjusted for non-cash items. We expect annual operating cash flow for 2001 to be $110 million to $120 million. We expect annual operating cash flow for 2002 to be $120 million to $130 million. During the nine months ended September 30, 2001, we used $196.8 million of cash for investing activities compared with $46.4 million for the same period in 2000. The increase in cash used for investing activities is primarily due to an increase in acquisition spending. In the first quarter of 2001, we acquired Fisher Clinical Services for an adjusted purchase price of $132.7 million. We also acquired two other entities for an aggregate purchase price of approximately $31.2 million. The acquisitions were funded with cash on hand and through the sale of receivables under our receivables securitization facility. We also invested $6.0 million as a debt investment in Medical Analysis Systems in the first quarter of 2001 and $3.2 million for our minority interest in HealthNexis. In November 2001, HealthNexis and Global HealthCare Exchange, LLC announced a plan to combine their operations. Upon completion of the merger, 30 we will have an approximate ownership interest of 2.5% in the combined company. We will have no additional funding commitments to the newly merged entity. We anticipate an increase in annual capital expenditures during 2001 to approximately $45 million due to our ongoing warehouse consolidation program and expenditures related to acquisitions. We expect a further increase in annual capital expenditures during 2002 to $65 million due to these same activities and an increased investment in chemical manufacturing. During the year ended December 31, 2000, we used $57.1 million of cash for investing activities, compared with $62.5 million in 1999. We used $23.1 million for acquisitions in 2000, primarily for a manufacturing facility. During 1999, we completed two acquisitions and acquired the remaining shares of Bioblock Scientific S.A. for an aggregate net purchase price of $34.4 million. Capital expenditures decreased to $29.4 million in 2000 compared to $41.1 million in 1999. The decrease in 2000 was due to lower spending on information systems due to reduced spending for the Year 2000 issue and lower spending on facilities. Proceeds from the sale of property, plant and equipment decreased to $1.7 million in 2000 from $16.0 million in 1999. In 1999, we received proceeds from the sale of the UniKix Technology software business and from fixed asset sales resulting from our long-term warehouse consolidation strategy. Our investing activities in 2000 and 1999 were funded with cash on hand and cash generated from operating activities. During the nine months ended September 30, 2001, our financing activities provided $282.7 million of cash compared with using $18.6 million of cash for the same period in 2000. In May 2001, we sold 12.8 million shares of common stock to the public at a price of $24.00 per share, for proceeds of approximately $289.9 million net of underwriters' discounts and offering costs. We used a portion of the net proceeds to reduce the amount of receivables sold under our receivables securitization facility by $170.0 million and the remainder for acquisitions, including the acquisition of Cole-Parmer. Cash used in financing activities decreased to $32.8 million in 2000 compared with $74.1 million in 1999. Financing activities primarily related to reductions in the amount of receivables sold under our receivables securitization facility of $21.7 million in 2000 and $83.5 million in 1999. As of September 30, 2001, we had $1,046.0 million in outstanding indebtedness, including $221.3 million in secured indebtedness under our bank credit agreement. You should refer to Note 12 to the notes to our audited financial statements incorporated by reference in this prospectus for a description of our debt agreements. At September 30, 2001, we had $123.6 million of available borrowing capacity under our revolving credit facility, net of $51.4 million for letters of credit outstanding. At September 30, 2001, the unused portion of our receivables securitization facility was $170 million. We expect that cash flows from operations together with cash and cash equivalents on hand and funds available under existing credit facilities will be sufficient to meet our ongoing operating, capital expenditure and debt service requirements for at least the next 12 months. We intend to continue to pursue acquisitions of complementary businesses that will enhance our growth and profitability. We currently have no commitment, understanding or arrangement relating to any additional material acquisitions. ACCOUNTING PRONOUNCEMENTS In October 2001, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets" ("SFAS 144"). This statement addresses financial accounting and reporting for the impairment or disposal of long-lived assets. This statement supersedes FASB Statement No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of", and the accounting and reporting provisions of APB Opinion No. 30, "Reporting 31 the Results of Operations -- Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions". This Statement also amends ARB No. 51, " Financial Statements", to eliminate the exception to consolidation for a subsidiary for which control is likely to be temporary. This Statement requires that one accounting model be used for long-lived assets to be disposed of by sale, whether previously held and used or newly acquired. This Statement also broadens the presentation of discontinued operations to include more disposal transactions. We adopted the provisions of this Statement at the beginning of 2002. The provisions of this Statement have been adopted as of January 1, 2002 and will be applied prospectively. In August 2001, the FASB issued Statement of Financial Accounting Standards No. 143, "Accounting For Asset Retirement Obligations" ("SFAS 143"). This Statement addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. It applies to legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development and (or) the normal operation of a long-lived asset, except for certain obligations of lessees. This standard requires entities to record the fair value of a liability for an asset retirement obligation in the period incurred. When the liability is initially recorded, the entity capitalizes a cost by increasing the carrying amount of the related long-lived asset. Over time, the liability is accreted to its present value each period, and the capitalized cost is depreciated over the useful life of the related asset. Upon settlement of the liability, an entity either settles the obligation for its recorded amount or incurs a gain or loss upon settlement. We adopted the provisions of SFAS 143 at the beginning of 2002. The adoption of SFAS 143 did not have a significant impact on our financial statements. In July 2001, the FASB issued Statement of Financial Accounting Standards No. 141, "Business Combinations" ("SFAS 141") and Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets" ("SFAS 142"). SFAS 141 requires the purchase method of accounting for business combinations initiated after June 30, 2001 and eliminates the pooling-of-interests method for business combinations. SFAS 141 also specifies the types of acquired intangible assets that are required to be recognized and reported separately from goodwill and those acquired intangible assets that are required to be included in goodwill. SFAS 141 shall be effective for all business combinations completed by us after June 30, 2001. Under the provisions of SFAS 141 goodwill and intangible assets determined to have an indefinite useful life that are acquired in a business combination completed after June 30, 2001, shall not be amortized. Goodwill and intangible assets acquired in business combinations completed prior to July 1, 2001, shall continue to be amortized until December 31, 2001. The adoption of SFAS 141 did not have a significant impact on our financial statements. SFAS 142 requires the use of a nonamortization approach to account for purchased goodwill and certain intangibles. Under the nonamortization approach, goodwill and certain intangibles will not be amortized in results of operations, but instead would be reviewed for impairment and written down with a resulting charge to operations only in the period in which the recorded value of goodwill and certain intangibles is more than its fair value. SFAS 142 requires us to perform an evaluation of whether goodwill is impaired as of January 1, 2002, the effective date of the statement for us. This impairment evaluation is required to be completed by December 31, 2002. Additionally, SFAS 142 requires us to reassess the useful lives and residual values of all intangible assets and make any necessary amortization adjustments. Any transitional impairment loss resulting from the adoption of SFAS 142 will be recognized as a cumulative effect of a change in accounting principle in our statement of operations. The adoption of SFAS 142 resulted in the elimination of goodwill amortization beginning January 1, 2002. Our annual goodwill amortization was approximately $16.5 million in 2001. We are in the process of 32 evaluating the effect that the transitional goodwill impairment provisions of this Statement will have on our financial statements. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We operate manufacturing and logistics facilities as well as offices around the world and utilize fixed and floating rate debt to finance our global operations. As a result, we are subject to business risks inherent in non-U.S. activities, including political and economic uncertainty, import and export limitations, and market risk related to changes in interest rates and foreign currency exchange rates. We believe the political and economic risks related to our foreign operations are mitigated due to the stability of the countries in which our largest foreign operations are located. In the normal course of business, we use derivative financial instruments, including interest rate swaps and foreign currency forward exchange contracts to manage our market risks. Additional information regarding our financial instruments is contained in Notes 6 and 12 to our audited financial statements incorporated by reference in this prospectus. Our objective in managing our exposure to changes in interest rates is to limit the impact of these changes on earnings and cash flow and to lower our overall borrowing costs. Our objective in managing our exposure to changes in foreign currency exchange rates is to reduce volatility on earnings and cash flow associated with these changes. Our principal currency exposures are in the Euro, the British pound, and in the Canadian dollar. We do not hold derivatives for trading purposes. We measure our market risk related to our holdings of financial instruments based on changes in interest rates and foreign currency rates utilizing a sensitivity analysis. The sensitivity analysis measures the potential loss in fair values, cash flows and earnings based on a hypothetical 10% change in interest and currency exchange rates. We use market rates on our financial instruments to perform the sensitivity analysis. We do not include items such as lease contracts, insurance contracts, and obligations for pension and other post-retirement benefits in the analysis. Our primary interest rate exposures relate to our cash, fixed and variable rate debt and interest rate swaps. The potential loss in fair values is based on an immediate change in the net present values of our interest rate sensitive exposures resulting from a 10% change in interest rates. The potential loss in cash flows and earnings is based on the change in the net interest income/expense over a one-year period due to an immediate 10% change in rates. A hypothetical 10% change in interest rates would not have had a material impact on our fair values, cash flows or earnings for the first nine months of 2001 or the years ended December 31, 2000 or 1999. Our primary currency rate exposures are to our intercompany debt, cash and foreign currency forward contracts. The potential loss in fair values is based on an immediate change in the U.S. dollar equivalent balances of our currency exposures due to a 10% shift in exchange rates. The potential loss in cash flows and earnings is based on the change in cash flow and earnings over a one-year period resulting from an immediate 10% change in currency exchange rates. A hypothetical 10% change in the currency exchange rates would not have had a material impact on our fair values, cash flows or earnings for the first nine months of 2001 or the years ended December 31, 2000 or 1999. 33 BUSINESS OVERVIEW We are a world leader in serving science. We offer more than 600,000 products and services that enable scientific discovery and clinical laboratory testing services to more than 350,000 customers located in approximately 145 countries. As a result of our broad product offering, integrated global logistics network and electronic commerce capabilities, we serve as a "one-stop source" of products, services and global solutions for many of our customers. Our primary target markets are life science, clinical laboratory and industrial safety supply. We generate approximately 80% of our revenues from the sale of consumable products. We believe that this revenue base provides us with a broad and stable platform for future growth. We believe that our broad range of products and services and integrated global logistics network position us to take advantage of recent industry trends. In particular, recent developments in genomics, proteomics and various other discovery technologies have resulted in an increase in the pace of drug discovery and development. These advances have, in turn, led to significant capital inflows to pharmaceutical and biotechnology organizations, which we expect to spur significant growth in life science spending and eventually lead to increased demand for our products and services. COMPANY HISTORY We were founded in 1902 and trace our roots back to 1851. Through organic growth and acquisitions we have established ourselves as a world leader in serving science. In January 1998, our management and an investment group including partnerships affiliated with Thomas H. Lee Partners purchased 87% of our common stock. THE INDUSTRY LIFE SCIENCE RESEARCH. The life science research supply market consists primarily of the manufacture, sourcing and distribution of a wide range of scientific instruments, equipment, chemicals and other supplies, to a wide range of pharmaceutical, biotechnology and educational customers. We estimate that sales to the United States scientific research market totaled approximately $7.0 billion in 1999 and that those sales are growing at an average annual rate of 6% to 7%. We believe that the following recent developments suggest continued growth in overall research investment by pharmaceutical, biotechnology and medical technology companies: - Advances in the field of genomics. The mapping of the human genome by the Human Genome Project and its private counterparts coupled with rapid developments in the field of proteomics to elucidate the function of proteins and their role in diseases is generating significant life science laboratory activity directed at discovering new drugs and biological targets. - Increasing number of drugs in development worldwide. The number of drugs in the worldwide development pipeline increased by 49% from approximately 5,500 in 1995 to approximately 8,200 in 2000. CLINICAL LABORATORY. The clinical laboratory supply market consists primarily of the manufacture, sourcing and distribution of a broad range of scientific instruments, equipment, chemicals, clinical consumable diagnostic stains and reagents and other supplies to group purchasing organizations, integrated delivery networks, independent clinical laboratories, hospital and physician office laboratories, and other healthcare providers. The clinical laboratory industry has experienced significant growth in recent years as a result of increasing point of care testing and an ever-increasing array of advanced diagnostic tests and procedures. We estimate that the participants in the U.S. clinical laboratory testing market sold products and services totaling 34 $35.0 billion in 1999, up from approximately $27.0 billion in 1993. We estimate that the clinical testing supply market, the market we serve, totals approximately $7.5 billion per year and will continue to grow over the next several years due to such factors as the general aging of the United States population, the development of more advanced tests for the early detection of disease and increased occupational drug testing. INDUSTRIAL SAFETY SUPPLY. The industrial safety supply market consists of the manufacture, sourcing and distribution of occupational health and safety products. These products include respiratory protection systems, environmental monitoring and sampling equipment, personal protection equipment and other safety and clean-room supplies. Typical users of these products include industrial companies, electronic manufacturers and pharmaceutical and biotechnology companies. The industrial safety supply market is a highly fragmented market that we estimate to be approximately $8.5 billion per year. CUSTOMERS We serve more than 350,000 customers in approximately 145 countries. Our customers range from nationally and internationally recognized scientific research, medical and educational institutions, pharmaceutical, biotechnology and medical technology companies, hospital purchasing organizations and government agencies to start-up companies. No single customer represented more than 5% of our total sales during the first nine months of 2001 or for the year ended December 31, 2000. We market our products and services to the following three principal customer groups: - laboratories engaged in scientific research and testing, including laboratories funded by biotechnology, medical technology and pharmaceutical companies, research institutions, medical schools and universities; - healthcare providers that perform diagnostic tests on patients, such as independent clinical laboratories, hospitals and physician office laboratories; and - users of occupational health and safety products in manufacturing and other activities. OUR STRATEGY Our objective is to enhance our position as a world leader in serving science. The key elements of our strategy are: LEVERAGE OUR COMPETITIVE STRENGTHS. Our key competitive strengths include: - Leading global brand name. The Fisher brand name has been widely recognized in the scientific community since 1902. In particular, we distribute more than one million product catalogs biennially, including the Fisher Catalog, a standard reference tool for scientists worldwide. - Broad product and service offering. Through our catalogs and website, we offer more than 600,000 products. We also offer a range of services, such as third-party procurement, bench-top delivery, laboratory instrument calibration and repair and contract manufacturing. Our broad offering of products and services enables us to effectively serve a diverse range of customers. In addition, our broad offering makes us the "one-stop source" for the research, clinical and safety supply needs of many of our customers. - Premier and diversified customer base. Our customers include some of the largest and fastest-growing companies in the life science, healthcare, education and industrial markets. These customers provide us with a stable source of business, enabling us to remain a market leader. 35 - Worldwide network of sales and customer service professionals. We have a worldwide sales and customer service network of more than 3,000 employees who respond to our customers' questions regarding our products and their applications. Many of our sales force members have scientific or medical backgrounds, which allow them to provide in depth and superior service to the end users of our products. - Global logistics and sourcing capabilities. We have assembled an integrated global distribution logistics network which, combined with our order entry and inventory management systems, enables us to deliver products and services on a rapid basis worldwide. We make approximately 25,000 shipments each day. In the United States, we ship approximately 95% of all orders within 24 hours of the customer placing the order. CONTINUE TO PURSUE STRATEGIC ACQUISITIONS. Since 1991, we have acquired and successfully integrated 30 businesses. Through these acquisitions, we have expanded the markets that we serve and extended the breadth of our product and service offerings. We intend to leverage our experience in identifying and executing acquisitions by seeking to acquire additional businesses that, in conjunction with our existing capabilities, will enable us to: - Further penetrate existing markets. We are continuing to pursue domestic and international acquisition opportunities in our life science research, clinical laboratory, educational and industrial safety distribution markets. - Expand product and service offerings. We seek acquisition candidates that enable us to expand our product and service offerings to continually respond to the needs of our customers. Many of our customers are increasingly outsourcing a variety of operations, including manufacturing and packaging. We believe that we can capitalize on this trend by acquiring businesses that allow us to provide value-added services to our customers. For example, our acquisition of Fisher Clinical Services allows us to provide clinical trial packaging and distribution services to our pharmaceutical and biotechnology customers. LEVERAGE AND MAINTAIN TECHNOLOGY LEADERSHIP. We believe that the technology systems that enhance our distribution, logistics and customer service capabilities are among our key competitive strengths. We were among the first in our industry to employ electronic-commerce technology and we constantly seek to enhance our leadership position in electronic commerce. Our website, www.fishersci.com, has approximately 160,000 registered users. We believe that it is the world's largest and most comprehensive virtual marketplace for the sale of products and supplies for the scientific community. This website provides an interface between our customers' enterprise resource planning, procurement and accounting systems and our order entry, customer service and logistics networks. This allows us to streamline the procurement process and reduce supply chain costs for us and our customers. Sales through our various electronic-commerce channels increased to $367.0 million in 2000 from $194.0 million in 1998, representing 14.0% of sales in 2000, compared to 8.5% in 1998. This trend has continued with sales through our electronic-commerce channels totaling $366.3 million, or 17.2% of our total sales, for the nine months ended September 30, 2001. CAPITALIZE ON GROWTH OPPORTUNITIES IN THE LIFE SCIENCE AND OTHER MARKETS. We plan to use our existing sourcing, manufacturing and logistics capabilities to further expand our product portfolio and offering of value-added services to strengthen our position in existing markets and enter new markets. In particular, the life science market has historically been one of our most important sources of business. We serve this market through our direct sales force and a dedicated team of specialists whom we have trained to meet the needs of our life science customers. In recent years, the life science market has experienced significant growth, which we are seeking to capitalize on by: - sourcing and developing new products; - augmenting our team of life science specialists; and 36 - continually developing and introducing new programs to better serve our existing customers and attract new customers in these markets. PRODUCTS AND SERVICES We currently offer more than 600,000 products, including self-manufactured products and products that we source from third party manufacturers. We constantly seek to expand and refine our product offerings to provide our customers with a complete array of products including: - Life science research products, such as scientific instruments, equipment, chemicals, clinical consumables and diagnostic reagents. - Clinical laboratory products, such as scientific instruments, equipment, chemicals, clinical consumables, diagnostic stains and reagents and other supplies. - Industrial safety supply products, such as personal protection equipment, respiratory protection systems, environmental monitoring and sampling equipment and other safety and clean room supplies. PROPRIETARY PRODUCTS. Our proprietary products consist of self-manufactured products, Fisher branded products and products for which we serve as the exclusive distributor. We estimate that proprietary products accounted for approximately 40% of our total sales in the first nine months of 2001 and in 2000. We sell these products primarily through our domestic and international distribution network. LABORATORY WORKSTATIONS. We manufacture and distribute laboratory workstations and fume hoods to companies engaged in scientific research. We also sell enclosures for technology and communication equipment. We sell our laboratory workstations primarily through a network of exclusive dealers. Our laboratory workstation product offering complements our broad consumable portfolio and enhances our position as a "one-stop source" for the laboratory needs of our customers. SERVICES. We offer our customers general laboratory instrument repair and safety equipment services. We service all of our self-manufactured equipment and instrumentation and provide repair and warranty services for many other manufacturers. In addition, our broad portfolio of services includes instrument calibration, instrument certification and integrated services designed to provide comprehensive instrument coverage, documentation and facility service management. PHARMACEUTICAL OUTSOURCING SERVICES. We provide contract manufacturing services worldwide to our pharmaceutical and biotechnology customers. These services include the manufacture of chemicals and diagnostics according to our customers' specifications. In addition, we have expanded our service offerings to leverage our presence and brand recognition in the pharmaceutical and biotechnology industries through our acquisition of the pharmaceutical packaging services business of Covance, which we renamed Fisher Clinical Services Inc., and a diagnostic manufacturing facility from Bayer Corporation, which we renamed Fisher Diagnostics. Fisher Clinical Services provides specialized packaging, distribution and related services for biotechnology and pharmaceutical companies engaged in the clinical trials phase of drug development. SALES AND MARKETING SALES AND CUSTOMER SERVICE PROFESSIONALS. We provide customer support through a worldwide network of more than 3,000 sales and customer service employees. Our direct sales force consists of account representatives and product/systems sales specialists who are located worldwide. These customer service representatives, supported by a scientific and technical staff, 37 respond to end-user product or application questions and assist our customers with efficient order acquisition. Most of the members of our direct sales force have scientific or medical backgrounds, which enable them to provide technical assistance to the end users of our products. Because of the complexity of many of the products that we offer, we believe that this technical expertise is highly valued by our customers. These representatives provide the basis for our market-driven new product and service development program. They do this by identifying customer needs and based upon this information, we use our extensive technical expertise to develop new products or services. FISHER CATALOG. We have been publishing the Fisher Catalog for more than 95 years. The Fisher Catalog is a standard product reference for the scientific community worldwide. In addition, we publish the Fisher HealthCare Catalog, the Acros Organics Catalog of Fine Chemicals, the Fisher Chemical Catalog, the Fisher Science Education Catalog, the Fisher Scientific Safety Catalog and the Cole-Parmer(R) General Catalog. We also publish catalogs in eight different languages to support our growing worldwide presence. We continuously add new products to the electronic version of our catalogs, making our suite of catalogs one of the most complete and up-to-date sources of laboratory and safety products available. We produce more than one million printed copies of our various catalogs biennially, with supplements tailored to specific market segments such as biotechnology, research chemicals, educational materials and occupational health and safety. ELECTRONIC-COMMERCE. We introduced our first proprietary electronic ordering system in 1967. We have developed electronic-commerce capabilities that target the scientific research, healthcare and safety marketplaces. We believe that we are the leading electronic-commerce solution serving the life science, clinical laboratory and industrial safety markets. We offer a robust web-enabled, on-line procurement system for both end users and purchasing professionals designed to streamline their purchasing time and reduce costs. DISTRIBUTION NETWORK Our domestic logistics network consists of 25 locations, including a national distribution center in Somerville, New Jersey, regional centers in Massachusetts, California, Illinois and Georgia and 20 local distribution facilities throughout the United States. Outside of the United States, we have 17 logistics facilities in 10 countries, including facilities in Canada, Europe, the Far East and Latin America. We augment our international logistics network with sales offices in 19 countries and independent dealers in over 100 countries worldwide. We make approximately 25,000 shipments per day. In the United States, we ship approximately 95% of all orders within 24 hours of the customer placing the order. MANUFACTURING Our principal manufacturing facilities are located in: - Fair Lawn and Somerville, New Jersey; - Geel, Belgium; - Two Rivers, Wisconsin; - Rochester and Conklin, New York; - Allentown, Indiana and Pittsburgh, Pennsylvania; - Mountain Home, Arkansas; - Loughborough and Horsham, United Kingdom; - Middletown, Virginia; - Camarillo, California; - Barrington, Illinois; - Singapore; and - Basel, Switzerland. 38 We have clean-room manufacturing facilities that meet customer and Food and Drug Administration requirements. All chemicals manufactured in our FDA licensed, ISO 9002-certified and cGMP facilities undergo rigorous quality assurance and testing procedures throughout the entire production process. Our constant testing through production ensures that our chemicals have the lot-to-lot consistency our customers need for uniform analysis. We have invested in a complete range of instrumentation and scientific staff for quality testing and analysis. SUPPLIERS We distribute laboratory instruments, supplies and equipment obtained from approximately 6,000 vendors. Our largest supplier represented approximately 10% of sales for the first nine months of 2001 and for the year ended December 31, 2000. Our manufacturing operations are not dependent on any particular supplier or group of affiliated suppliers of raw materials, and we have not experienced difficulties in obtaining raw materials in the past. COMPETITION We operate in a highly competitive market. We compete primarily with a wide range of suppliers and manufacturers that sell their own products directly to end-users. We also compete with other distributors. The principal means of competition in the markets we serve are systems capabilities, breadth, price and service. We believe we compete favorably as to all of these factors. TRADEMARKS AND PATENTS We own or license several patents and patent applications, but we do not consider any single patent to be material. We have more than 250 registered and unregistered service marks and trademarks for our products and services. Some of our more significant marks include Fisher Rims, Accumet, Acros, Barnant, Biochemical Sciences, Chemalert, Chemguard, Cole - Parmer, Enviroware, Eutech, Fisher, Fisherbiotech, Fisherbrand, Fisher Diagnostics, Fisher HealthCare, Fisher Safety, Fisher Scientific, Gastrak, Hamilton, Histoprep, Isotemp, Marathon, Masterflex, Microprobe, Oakton, Optima, Pacific Hemostasis, and Valutrak. Registered trademarks generally can have perpetual life, provided they are renewed on a timely basis and continue to be used properly as trademarks, subject to the rights of third parties to seek cancellation of the marks. EMPLOYEES As of November 30, 2001, we had approximately 8,900 full-time employees. We consider relations with our employees to be good. We are a party to several collective bargaining agreements, which do not cover a significant number of employees. ENVIRONMENTAL MATTERS A number of our domestic and international operations involve the handling, manufacture, use or sale of substances that are or could be classified as toxic or hazardous substances within the meaning of applicable environmental laws. Consequently, some risk of environmental and other damage is inherent in our particular operations and products, as it is with other companies engaged in similar businesses. Our expenses for environmental matters relate to the costs of managing company-wide environmental protection compliance programs, complying with environmental regulations and permitting requirements and installing, operating and maintaining groundwater treatment systems and other remedial activities related to environmental contamination. These expenses were approximately $1.2 million in 2000 and $1.0 million in 1999. 39 We estimate that our expenses for environmental matters will continue to be approximately $1.0 million per year. Our Fair Lawn and Somerville, New Jersey facilities are the subject of administrative consent orders issued by the New Jersey Department of Environmental Protection. These orders require us to maintain groundwater remediation activities at these sites. In addition, as the owner of the Fair Lawn facility, we are listed as a potentially responsible party for remediation of contamination located within an area called the Fairlawn Wellfields Superfund Site. This site was listed in 1983 on the National Priority List under the Federal Comprehensive Environmental Response Compensation and Liability Act of 1980. This statute, referred to as "CERCLA", is also known as the "Superfund Act". We have also been notified that we are among the potentially responsible parties under CERCLA or similar state laws for the costs of investigating or remediating contamination at various other superfund sites. Our other liabilities for environmental matters relate to domestic and international remedial measures and environmental regulatory compliance requirements such as the Clean Air Act, the Clean Water Act and other applicable governmental requirements. We cannot predict our potential costs related to environmental matters and the possible impact on our future operations given the uncertainties regarding the extent of any required cleanups, the complexity and interpretation of applicable laws and regulations, the varying costs of alternative cleanup methods and the extent of our responsibility. However, these costs could be material. We record accruals for environmental liabilities, based on current interpretations of environmental laws and regulations when it is probable that a liability has been incurred and the amount of such liability can be reasonably estimated. We calculate estimates based upon reports prepared by environmental specialists and our management's knowledge and experience with these environmental matters. We include in these estimates potential costs for investigation, remediation, operation and maintenance of cleanup systems and related capital expenditures. Our accrued liabilities for environmental matters were $30.2 million for the nine months ended September 30, 2001 and $31.0 million and $32.5 million at December 31, 2000 and 1999, respectively. Although these amounts do not include third-party recoveries, we may be entitled to indemnification from third parties for liabilities relating to certain sites. We believe that this accrual is adequate for the environmental liabilities that we expect to incur. As a result, we believe that our ultimate liability with respect to environmental matters will not have a material adverse effect on our financial position or results of operations. However, we may be subject to additional remedial or compliance costs due to future events, such as changes in existing laws and regulations, changes in agency direction or enforcement policies, developments in remediation technologies or changes in the conduct of our operations, which could have a material adverse effect on our financial position or results of operations. LEGAL PROCEEDINGS We are a party to various lawsuits and other legal proceedings, including some class action and consolidated multi-party product liability actions for products we allegedly distributed. We believe that the ultimate liability with respect to these matters, if any, will not have a material adverse effect on our results of operations, financial position and cash flows. 40 MANAGEMENT Our executive officers and directors, and their ages and positions as of November 30, 2001 are:
EXECUTIVE OFFICERS AND DIRECTORS AGE POSITION - -------------------------------- --- -------- Paul M. Montrone(3)........................ 60 Chairman of the Board and Chief Executive Officer Paul M. Meister(3)......................... 49 Vice Chairman of the Board David T. Della Penta....................... 53 President and Chief Operating Officer Kevin P. Clark............................. 39 Vice President and Chief Financial Officer Todd M. DuChene............................ 38 Vice President, General Counsel and Secretary Mitchell J. Blutt, M.D.(1)................. 44 Director Robert A. Day(1)(2)........................ 57 Director Michael D. Dingman(2)...................... 70 Director Anthony J. DiNovi(3)....................... 39 Director David V. Harkins........................... 60 Director Scott M. Sperling(2)(3).................... 43 Director Kent R. Weldon(1).......................... 34 Director
- --------------- (1) Member of the Audit Committee. (2) Member of Compensation Committee. (3) Member of the Executive Committee. Paul M. Montrone has been our Chairman of the Board since March 1998 and our Chief Executive Officer since prior to 1996. He served as our President from prior to 1996 to 1998. Mr. Montrone is also a director of the General Chemical Group Inc. (producer of soda ash and calcium chloride) (Chairman), GenTek Inc. (manufacturer of telecommunications, automotive and performance products) (Chairman) and Waste Management, Inc. Paul M. Meister has been our Vice Chairman of the Board and Executive Vice President since March 2001. He served as our Vice Chairman of the Board, Executive Vice President and Chief Financial Officer from March 1998 to February 2001. He served as our Senior Vice President and Chief Financial Officer from prior to 1996 to March 1998. Mr. Meister is also a director of General Chemical Group Inc. (Vice Chairman), GenTek Inc. (Vice Chairman), M&F Worldwide Corp. and Minerals Technologies Inc. David T. Della Penta has been our President and Chief Operating Officer since April 1998. From prior to 1996 until April 1998, Mr. Della Penta served as President of Nalge Nunc International, a subsidiary of Sybron International Corporation (now known as Apogent Technologies, Inc.) (medical laboratory device manufacturer). Kevin P. Clark has been our Vice President and Chief Financial Officer since March 2001. He served as our Vice President and Controller from May 1998 to February 2001. Mr. Clark served as our Vice President and Treasurer from September 1997 to May 1998, and as our Assistant Treasurer from prior to 1996 to 1997. Todd M. DuChene has been our Vice President, General Counsel and Secretary since November 1996. Mitchell J. Blutt, M.D. has been an Executive Partner of J.P. Morgan Partners, LLC, or its predecessor, Chase Capital Partners, since 1996. He is also an executive officer of JPMP Capital Corp., which is the general partner of the general partner of J.P. Morgan Partners (BHCA), L.P. 41 (formerly Chase Equity Associates, L.P.). He has been an Adjunct Assistant Professor of Medicine at Weill Medical College of Cornell University since prior to 1996, and is a certified internist. Robert A. Day has been Chairman of the Board and Chief Executive Officer of Trust Company of the West (investments) since prior to 1996 and Chairman and President of W.M. Keck Foundation (philanthropic organization) since 1996. Mr. Day is also a director of Freeport-McMoran Inc. Michael D. Dingman was our Chairman of the Board from prior to 1996 until 1998. He has been President of Shipston Group Ltd. (international investments) since prior to 1996. Mr. Dingman is also a director of Ford Motor Company. Anthony J. DiNovi has been employed by Thomas H. Lee Partners, L.P., and its predecessor Thomas H. Lee Company since prior to 1996 and currently serves as a Managing Director. Mr. DiNovi serves as a director of Eye Care Centers of America, Inc., Fairpoint Communications, Inc., USLEC Corp. and Vertis, Inc. David V. Harkins has been employed by Thomas H. Lee Partners, L.P., and its predecessor Thomas H. Lee Company since prior to 1996 and currently serves as a Senior Managing Director and President of Thomas H. Lee Partners, L.P. Mr. Harkins serves as a director of Conseco Inc., Cott Corporation, Metris Companies, National Dentex (Chairman), Stanley Furniture Company, Inc., and Syratech Corporation. Scott M. Sperling has been employed by Thomas H. Lee Partners, L.P., and its predecessor Thomas H. Lee Company since prior to 1996 and currently serves as a Managing Director. Mr. Sperling serves as a director of CTC Communications, GenTek, Vertis, Inc. and Wyndham International. Kent R. Weldon has been employed by Thomas H. Lee Partners, L.P., and its predecessor Thomas H. Lee Company since prior to 1996 and currently serves as a Managing Director. Mr. Weldon serves as a director of Fairpoint Communications, Inc. and Syratech Corporation. 42 PRINCIPAL AND SELLING STOCKHOLDERS The following table sets forth as of November 30, 2001 certain information concerning the beneficial ownership of our stock by: - each person known by us to be a beneficial owner of more than 5% of common stock; - our chief executive officer and each of our four other most highly compensated executive officers; - each of our directors; - all of our directors and executive officers as a group; and - each of the selling stockholders. Beneficial ownership is determined in accordance with the rules of the SEC. Shares of common stock subject to options that are presently exercisable or exercisable within 60 days of November 30, 2001 are deemed outstanding for the purpose of computing the percentage ownership of the person holding the option, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person. Unless otherwise noted, references to shares in the footnotes to the following table refer to shares of our voting common stock. The percentages in the table below, for beneficial ownership prior to this offering, are calculated on the basis of 54,152,184 shares of common stock outstanding as of November 30, 2001.
PRIOR TO OFFERING AFTER THE OFFERING -------------------------- SHARES BEING ------------------- COMMON STOCK OFFERED COMMON STOCK -------------------------- ------------ ------------------- NAME OF BENEFICIAL OWNER NUMBER % NUMBER % - ------------------------ ------ - ------ - Thomas H. Lee Equity Fund III, L.P. .............................. 21,749,345(1)(2)(3) 39.0% 3,629,384 18,119,961 32.5% Credit Suisse First Boston........... 6,572,289(2)(4)(5) 12.0 1,093,187 5,479,102 10.0 J.P. Morgan Partners (BHCA), L.P. ... 4,367,335(2)(6) 8.0 728,791 3,638,544 6.7 Merrill Lynch & Co................... 1,310,205(2)(20) 2.4 218,638 1,091,567 2.0 Paul M. Montrone..................... 2,851,007(2)(7) 5.1 370,000 2,481,007 4.5 Paul M. Meister...................... 1,760,108(2)(8) 3.2 240,000 1,520,108 2.8 David T. Della Penta................. 524,387(2)(9) * 15,000 509,387 * David V. Harkins..................... 108,210(2)(10) * 18,057 90,153 * Kevin P. Clark....................... 110,100(2)(11) * 19,000 91,100 * Todd M. DuChene...................... 107,963(2)(12) * 18,783 89,180 * Scott M. Sperling.................... 54,105(2)(13) * 9,029 45,076 * Anthony J. DiNovi.................... 54,105(2)(14) * 9,029 45,076 * Robert A. Day........................ 27,758(15) * -- 27,758 * Kent R. Weldon....................... 8,115(2)(16) * 1,354 6,761 * Mitchell J. Blutt, M.D.(6)........... -- -- -- -- -- Michael D. Dingman (17).............. -- -- -- -- -- Other Management..................... 1,329,032 2.4 167,217 1,161,815 2.1 All directors and executive officers as a group (12 individuals)........ 5,605,858(2)(18)(19) 9.9% 700,252 4,905,606 8.6%
43 - --------------- * Less than 1% (1) The address of Thomas H. Lee Equity Fund III, L.P. ("Equity Fund III") is c/o Thomas H. Lee Partners, L.P., 75 State Street, Boston, Massachusetts 02109. The information is based on a Schedule 13D dated February 2, 1998, as amended by Amendment No. 1 thereto dated April 13, 1999 and Amendment No. 2 thereto dated July 3, 2001, filed with the SEC by the THL Entities (including Equity Fund III, THL FSI Equity Investors L.P. ("THL-FSI"), THL Foreign Fund III ("Foreign Fund III"), THL-CCI Limited Partnership ("THL-CCI"), David V. Harkins, Anthony J. DiNovi, Scott M. Sperling and Kent R. Weldon (collectively, the "THL Directors"), certain persons affiliated with Thomas H. Lee Partners, L.P. or the THL Directors (collectively, the "Additional THL Persons")); Thomas H. Lee Equity Advisors III Limited Partnership ("Advisors III"), THL Equity Trust III ("Trust III") and THL Investment Management Corp ("THL Investment"). Each of the THL Entities, Advisors III, Trust III and THL Investment expressly disclaims beneficial ownership of shares of common stock held by others. (2) The shares are subject to the terms and restrictions of an Amended and Restated Investors' Agreement (the "Investors' Agreement") dated as of March 29, 1999 and amended on May 14, 2000 and May 2001 among us; the THL Entities; DLJ Merchant Banking Partners II, L.P. ("DLJ Partners II"); DLJ Merchant Banking Partners Il-A, L.P. ("DLJ Partners Il-A"), DLJ Offshore Partners II, C.V. ("DLJ offshore II"); DLJ Diversified Partners, L.P. ("DLJ Diversified"); DLJ Diversified Partners-A, L.P. ("DLJ Diversified-A"); DLJ Millennium Partners, L.P. ("DLJ Millennium"); DLJ Millennium Partners-A, L.P. ("DLJ Millennium-A"); DLJMB Funding II, Inc. ("DLJ Funding II"); UK Investment Plan 1997 Partners ("UK Partners"); DLJ EAB Partners, L.P. ("DLJ EAB"); DLJ ESC II, L.P. ("DLJ ESC II"), and DLJ First ESC, L.P. ("DLJ ESC" and DLJ Partners II, DLJ Partners Il-A, DLJ Offshore II, DLJ Diversified, DLJ Diversified-A, DLJ Millennium, DLJ Millennium-A, DLJ Funding II, UK Partners, DLJ EAB and DLJ ESC II are collectively referred to herein as the "DLJ Entities"); J.P. Morgan Partners (BHCA), L.P., formerly Chase Equity Associates, L.P. ("CEA"); Merrill Lynch KECALP L.P. 1997 ("ML KECALP"); KECALP Inc. ("KECALP"); ML IBK Positions, Inc. ("ML IBK" and together with ML KECALP and KECALP, the "ML Entities"); and Paul M. Montrone, Paul M. Meister, Todd M. DuChene and certain other members of Fisher management (collectively, the "Management Investors"), whom collectively may constitute a "group" under the Securities Exchange Act of 1934, as amended. Each of the parties to the Investors' Agreement expressly disclaims beneficial ownership of shares of common stock held by others. (3) Includes 12,047,625 outstanding shares and 991,340 shares issuable upon the exercise of warrants to purchase shares owned by Equity Fund III; 6,052,935 outstanding shares and 498,070 shares issuable upon the exercise of warrants to purchase shares owned by THL-FSI; 745,470 outstanding shares and 61,340 shares issuable upon the exercise of warrants to purchase shares owned by Foreign Fund III; 741,960 outstanding shares and 61,045 shares issuable upon the exercise of warrants to purchase shares owned by THL-CCI; 99,980 outstanding shares and warrants to purchase 8,230 shares owned by Mr. Harkins and persons affiliated with Mr. Harkins (see footnote 10); 49,990 outstanding shares and warrants to purchase 4,115 shares issuable upon the exercise of warrants to purchase shares owned by Mr. Sperling or a limited partnership of which Mr. Sperling is a general partner (see footnote 13); 49,990 outstanding shares and warrants to purchase 4,115 shares owned by Mr. DiNovi; 7,500 outstanding shares and warrants to purchase 615 shares owned by Mr. Weldon; and 300,310 outstanding shares and warrants to purchase 24,715 shares attributable to the Additional THL Persons. (4) The address of Credit Suisse First Boston is Vetlibergstrasse 231, P.O. Box 900, CH-8070 Zurich, Switzerland. The information is based on a Schedule 13D dated February 10, 1998 44 as amended by Amendment No. 1 thereto dated December 14, 2000 filed with the SEC by Credit Suisse First Boston, a Swiss bank (the "Bank"), on behalf of itself and its subsidiaries to the extent that they constitute a part of the Credit Suisse First Boston business unit (the "CSFB Business Unit") of the Credit Suisse Group, a Swiss Corporation ("CSG"), including Credit Suisse First Boston, Inc., Credit Suisse First Boston (USA), Inc. (formerly known as Donaldson, Lufkin and Jenrette, Inc.), the DLJ Entities, DLJ Merchant Banking II, LLC, DLJ Merchant Banking II, Inc., DLJ Diversified Associates, L.P., DLJ Diversified Partners, Inc., DLJ LBO Plans Management Corporation, DLJ Capital Investors, Inc. and UK Investment Plan 1997, Inc. CSG expressly disclaims beneficial ownership of shares of common stock held by its direct and indirect subsidiaries, including the CSFB Business Unit. The CSFB Business Unit expressly disclaims beneficial ownership of shares of common stock held by CSG and any of CSG's and the Bank's other business units. (5) Includes 3,812,895 outstanding shares and 313,745 shares issuable upon the exercise of warrants to purchase shares owned by DLJ Partners II; 676,965 outstanding shares and 55,700 shares issuable upon the exercise of warrants to purchase shares owned by DLJ Funding II; 719,015 outstanding shares and 59,165 shares issuable upon the exercise of warrants to purchase shares owned by DLJ ESC II; 222,920 outstanding shares and 18,345 shares issuable upon the exercise of warrants to purchase shares owned by DLJ Diversified; 187,500 outstanding shares and 15,430 shares issuable upon the exercise of warrants to purchase shares owned by DLJ Offshore II; 151,845 outstanding shares and 12,495 shares issuable upon the exercise of warrants to purchase shares owned by DLJ Partners II-A; 100,880 outstanding shares and 8,300 shares issuable upon the exercise of warrants to purchase shares owned by U.K. Partners; 61,650 outstanding shares and 5,075 shares issuable upon the exercise of warrants to purchase shares owned by DLJ Millennium; 82,785 outstanding shares and 6,810 shares issuable upon the exercise of warrants to purchase shares owned by DLJ Diversified-A; 17,120 outstanding shares and 1,410 shares issuable upon the exercise of warrants to purchase shares owned by DLJ EAB; 12,025 outstanding shares and 990 shares issuable upon the exercise of warrants to purchase shares owned by DLJ Millennium-A; and 7,335 outstanding shares and 605 shares issuable upon the exercise of warrants to purchase shares owned by DLJ ESC; and 21,284 shares held by CSFB in proprietary trading and investment accounts. Each of the DLJ Entities expressly disclaims beneficial ownership of shares of common stock held by others. (6) The address of J.P. Morgan Partners (BHCA), L.P. ("JPMP (BHCA)") is 1221 Avenue of the Americas, New York, New York 10020-1080. JPMP (BHCA) is the owner of 4,035,290 outstanding shares of non-voting stock and warrants to purchase 332,045 shares of non-voting stock, which stock is convertible on a one-to-one basis into shares of voting common stock, as provided by our corporate charter. Mitchell J. Blutt, M.D. serves as a director of Fisher, and is a limited partner of JPMP Master Fund Manager ("MF Manager"), formerly Chase Capital Partners, the general partner of JPMP (BHCA). As a result of internal reorganizations in January 2001, MF Manager became a limited partnership and all but one of its general partners, including Dr. Blutt, became limited partners in the partnership. Dr. Blutt expressly disclaims beneficial ownership of such securities except to the extent of his pecuniary interest therein. (7) Includes 1,348,626 shares issuable upon exercise of options exercisable within 60 days of November 30, 2001, 275,000 shares owned directly by Mr. Montrone, 362,500 shares which are held in the Fisher Scientific International Inc. Executive Retirement and Savings Program Trust (the "Savings Trust"), 726,985 shares held in a rabbi trust established under agreement dated as of January 21, 1998 (the "Rabbi Trust I") and 137,896 shares 45 held in a rabbi trust established under agreement dated as of March 30, 2001 (the "Rabbi Trust II"). The address for Mr. Montrone is c/o Fisher, Liberty Lane, Hampton, NH 03842. (8) Includes 812,302 shares issuable upon exercise of options exercisable within 60 days of November 30, 2001, 175,000 shares owned directly by Mr. Meister, 271,500 shares which are held in the Savings Trust, 443,849 shares which are held in the Rabbi Trust I and 57,457 shares held in the Rabbi Trust II. The address for Mr. Meister is c/o Fisher, Liberty Lane, Hampton, NH 03842. (9) Includes 325,000 shares issuable upon exercise of options exercisable within 60 days of November 30, 2001, 50,000 shares owned directly by Mr. Della Penta and 149,387 shares held in the Rabbi Trust II. The address for Mr. Della Penta is c/o Fisher, Liberty Lane, Hampton, NH 03842. (10) Includes 89,980 outstanding shares and 7,405 shares issuable upon the exercise of warrants to purchase shares owned directly by Mr. Harkins and 10,000 outstanding shares and 825 shares issuable upon the exercise of warrants to purchase shares owned by the 1995 Harkins Gift Trust as to which shares Mr. Harkins expressly disclaims any beneficial ownership. The address for Mr. Harkins is c/o THL Partners, 75 State St., Boston, MA 02109. (11) Includes 55,594 shares issuable upon exercise of options exercisable within 60 days of November 30, 2001, 7,785 shares owned directly by Mr. Clark, 26,036 shares held in the Rabbi Trust I and 20,685 shares held in the Rabbi Trust II. The address for Mr. Clark is c/o Fisher, One Liberty Lane, Hampton, NH 03842. (12) Includes 61,600 shares issuable upon exercise of options exercisable within 60 days of November 30, 2001, 18,783 shares held in the Rabbi Trust I and 27,580 shares held in the Rabbi Trust II. The address for Mr. DuChene is c/o Fisher, Liberty Lane, Hampton, NH 03842. (13) Includes 29,995 outstanding shares and warrants to purchase 2,470 shares owned by Mr. Sperling directly, and 19,995 outstanding shares and warrants to purchase 1,645 shares owned by the Sperling Family Limited Partnership as to which shares and warrants Mr. Sperling expressly disclaims beneficial interest. The address for Mr. Sperling is c/o THL Partners, 75 State St., Boston, MA 02109. (14) Includes 49,990 outstanding shares and warrants to purchase 4,115 shares owned by Mr. DiNovi directly. The address for Mr. DiNovi is c/o THL Partners, 75 State St., Boston, MA 02109. (15) Shares held in the Rabbi Trust I. The address for Mr. Day is c/o Fisher, Liberty Lane, Hampton, NH 03842. (16) Includes 7,500 outstanding shares and 615 shares issuable upon the exercise of warrants to purchase shares held by Mr. Weldon directly. The address for Mr. Weldon is c/o THL Partners, 75 State St., Boston, MA 02109. (17) The address for Mr. Dingman is c/o Fisher, Liberty Lane, Hampton, NH 03842. (18) Includes 2,603,122 shares issuable upon exercise of options exercisable within 60 days of November 30, 2001, 715,245 shares held directly, 634,000 shares held indirectly, 17,075 shares issuable upon the exercise of warrants, 1,243,411 shares held in the Rabbi Trust I and 393,005 shares held in the Rabbi Trust II. (19) Includes 10,000 outstanding shares and 825 shares issuable upon the exercise of warrants to purchase shares owned by the 1995 Harkins Gift Trust (as to which shares and warrants Mr. Harkins expressly disclaims beneficial ownership), 19,995 outstanding shares and 1,645 shares issuable upon the exercise of warrants to purchase shares owned by the 46 Sperling Family Limited Partnership (as to which shares and warrants Mr. Sperling expressly disclaims beneficial ownership). (20) Includes 973,370 outstanding shares and 80,095 shares issuable upon the exercise of warrants to purchase shares owned by ML KECALP; 185,405 outstanding shares and 15,255 shares issuable upon the exercise of warrants to purchase shares owned by KECALP; 51,815 outstanding shares and 4,265 shares issuable upon the exercise of warrants to purchase shares owned by ML IBK. Each of the ML Entities expressly disclaims beneficial ownership of shares of common stock held by others. 47 DESCRIPTION OF CAPITAL STOCK Our authorized capital stock consists of 500,000,000 shares of common stock, par value $.01 per share, of which 4,182,375 shares are designated as non-voting common stock and 9,000,000 shares are designated as Series B non-voting common stock, and 15,000,000 are shares of preferred stock, par value $.01 per share. As of November 30, 2001, there were outstanding: - 50,116,894 shares of voting common stock held by 136 stockholders of record; - 4,035,290 shares of non-voting common stock held by one stockholder of record; - warrants to purchase 2,251,270 shares of voting common stock and 332,045 shares of non-voting common stock; and - options to purchase an aggregate of 7,516,033 shares of voting common stock. As of November 30, 2001, we had no shares of Series B non-voting common stock or preferred stock outstanding. The following summary of provisions of our securities, various provisions of our corporate charter and our by-laws and provisions of applicable law is not intended to be complete and is qualified by reference to the provisions of applicable law and to our corporate charter and by-laws, which are incorporated by reference as exhibits to the registration statement of which this prospectus is a part. COMMON STOCK OUR VOTING COMMON STOCK The holders of our voting common stock are entitled to one vote per share on all matters submitted for action by our stockholders. Our stockholders do not have cumulative voting rights. Accordingly, holders of a majority of our voting common stock entitled to vote in any election of directors may elect all of the directors standing for election. Holders of our voting common stock are entitled to receive ratably with other holders of our voting common stock and with holders of our non-voting common stock and Series B non-voting common stock any dividends declared by our board of directors. Upon our liquidation, dissolution or winding up, the holders of our voting common stock are entitled to receive ratably with other holders of our voting common stock and with holders of our non-voting common stock and Series B non-voting common stock our net assets available after the payment of all debts and other liabilities. Holders of our voting common stock have no preemptive, redemption or conversion rights, except that some holders have preemptive and registration rights under our investors' agreement described below. The rights, preferences and privileges of holders of our voting common stock are subject to the rights, preferences and privileges of holders of shares of any series of preferred stock which we may designate and issue in the future. OUR NON-VOTING COMMON STOCK Limited Voting Rights. The holders of our non-voting common stock are generally not entitled to vote on any matter on which our stockholders are entitled to vote. Shares of non-voting common stock are not included in determining the number of shares voting or entitled to vote on any such matters. The holders of our non-voting common stock have the right to vote as a separate class on any merger or consolidation with or into another entity or entities, or any recapitalization or reorganization, in which shares of non-voting common stock would receive or be exchanged for consideration different on a per share basis from consideration received with respect to or in exchange for the shares of our voting common stock or would otherwise be treated differently 48 from shares of our voting common stock in connection with such transactions. Notwithstanding the preceding sentence, shares of non-voting common stock may, without such a separate class vote, receive or be exchanged for non-voting securities which are otherwise identical on a per share basis in amount and form to the voting securities received with respect to or exchanged for our voting common stock so long as: - such non-voting securities are convertible into such voting securities on the same terms as our non-voting common stock is convertible into our voting common stock; and - all other consideration is equal on a per share basis. Economic Rights. Holders of our non-voting common stock are generally entitled to receive ratably with holders of our voting common stock and Series B non-voting common stock any dividends declared by our board of directors. Upon our liquidation, dissolution or winding up, the holders of our non-voting common stock are entitled to receive ratably with other holders of our non-voting common stock and with holders of our voting common stock and Series B non-voting common stock our net assets available after the payment of all debts and other liabilities. Holders of our non-voting common stock have no preemptive or redemption rights, except that some holders have preemptive and registration rights under our investors' agreement. The rights, preferences and privileges of holders of our non-voting common stock are subject to the rights, preferences and privileges of holders of shares of any series of preferred stock which we may designate and issue in the future. Conversion Rights. With limited exceptions as to holders who are subject to Regulation Y of the Federal Reserve System, shares of our non-voting common stock may be converted into the same number of shares of our voting common stock at any time at the option of the holder of the shares of non-voting common stock. OUR SERIES B NON-VOTING COMMON STOCK Limited Voting Rights. The holders of our Series B non-voting common stock are generally not entitled to vote on any matter on which our stockholders are entitled to vote. Shares of Series B non-voting common stock are not included in determining the number of shares voting or entitled to vote on any such matters. The holders of our Series B non-voting common stock have the right to vote as a separate class on any merger or consolidation with or into another entity or entities, any recapitalization or reorganization, or any amendment, repeal or modification of any provision of our corporate charter that would adversely affect the powers, preferences or special rights of the holders of our Series B non-voting common stock. Economic Rights. Holders of our Series B non-voting common stock are generally entitled to receive ratably with holders of our voting common stock and non-voting common stock any dividends declared by our board of directors. Upon our liquidation, dissolution or winding up, the holders of our Series B non-voting common stock are entitled to receive ratably with other holders of our Series B non-voting common stock and with holders of our voting common stock and non-voting common stock our net assets available after the payment of all debts and other liabilities. Holders of our Series B non-voting common stock have no preemptive or redemption rights, except that some holders have preemptive and registration rights under the investors' agreement. The rights, preferences and privileges of holders of our Series B non-voting common stock are subject to the rights, preferences and privileges of holders of shares of any series of preferred stock which we may designate and issue in the future. 49 Conversion Rights. Shares of our Series B non-voting common stock may not be converted into shares of our voting common stock, except: - to meet the requirements of a "pooling of interests" accounting treatment; - to transfer Series B non-voting common stock, in which case the transferee will receive shares of our voting common stock; - to enable the holders to maintain such holder's percentage ownership of the total outstanding voting common stock; or - upon specific major corporate events, such as a merger or a public offering. In May 2001, the holders of all 9,000,000 outstanding shares of Series B non-voting common stock converted those shares into 9,000,000 shares of voting common stock. We have no present plan to issue any additional shares of Series B non-voting common stock. PREFERRED STOCK Under the terms of our corporate charter, our board of directors is authorized to issue shares of preferred stock in one or more series without stockholder approval. Our board of directors has discretion to determine the rights, preferences, privileges and restrictions, including voting rights, dividend rights, conversion rights, redemption rights and liquidation preferences of each series of preferred stock. The purpose of authorizing our board of directors to issue preferred stock and determine its rights and preferences is to eliminate delays associated with stockholder approval of specific issuances. The issuance of preferred stock, while providing desirable flexibility in connection with possible acquisitions and other corporate purposes, could make it more difficult for a third party to acquire, or could discourage a third party from acquiring, a majority of our outstanding voting common stock. We have no present plans to issue any shares of preferred stock. WARRANTS AND STOCK OPTIONS As of November 30, 2001, there were warrants outstanding to purchase 2,251,270 shares of voting common stock and 332,045 shares of non-voting common stock at a per share exercise price of $9.65. These warrants are held by some of our current stockholders. As of November 30, 2001, 4,375,816 shares of voting common stock were issuable pursuant to stock option grants under our 1998 stock option plan at a weighted average exercise price of $12.73 per share, and 3,140,217 shares of voting common stock were issuable pursuant to stock option grants under our 2001 stock option plan at a weighted average exercise price of $26.26 per share. ANTI-TAKEOVER CONSIDERATIONS Our corporate charter and by-laws contain a number of provisions which may have the effect of making it more difficult for a third party to acquire, or of discouraging a third party from acquiring us. CLASSIFIED BOARD OF DIRECTORS Our corporate charter and our by-laws divide our board of directors into three classes, as nearly equal in size as possible, with staggered three year terms, and provide that: - directors may be removed only for cause by the affirmative vote of the holders of at least 80% of the shares of our capital stock entitled to vote; and 50 - any vacancy on our board of directors, however occurring, including a vacancy resulting from the enlargement of the board, may only be filled by vote of a majority of the directors then in office. STOCKHOLDER ACTION; SPECIAL MEETING OF STOCKHOLDERS Our corporate charter eliminates the ability of our stockholders to act by written consent. It further provides that special meetings of our stockholders may be called only by our chief executive officer or by our board of directors pursuant to a majority vote of the total number of authorized directors. ADVANCE NOTICE REQUIREMENTS FOR STOCKHOLDER PROPOSALS AND DIRECTORS NOMINATIONS Our by-laws provide that stockholders seeking to bring business before an annual meeting of stockholders, or to nominate candidates for election as directors at an annual meeting of stockholders, must provide timely notice in writing. To be timely, a stockholder's notice must be delivered to or mailed and received at our principal executive offices not less than 30 days nor more than 60 days prior to the annual meeting; however, if less than 40 days' notice or prior public disclosure of the date of the annual meeting is given or made to stockholders, notice by the stockholder in order to be timely must be received not later than the close of business on the tenth day following the date on which notice of the date of the annual meeting was mailed to stockholders or made public, whichever first occurs. Our by-laws also specify requirements as to the form and content of a stockholder's notice. These provisions may preclude stockholders from bringing matters before an annual meeting of stockholders or from making nominations for directors at an annual meeting of stockholders. AMENDMENTS; SUPERMAJORITY VOTE REQUIREMENTS Our charter requires the affirmative vote of 80% of our voting common stock to amend provisions of our corporate charter and by-laws, including those provisions relating to the classified board of directors, action by written consent and the ability of stockholders to call special meetings. 51 SHARES ELIGIBLE FOR FUTURE SALE GENERAL Based on shares outstanding as of November 30, 2001, we had outstanding 54,152,184 shares of our common stock, assuming no exercise of outstanding options or warrants after the date of this prospectus. Of these shares, all of the shares sold in this offering and approximately additional shares may be freely tradable without restriction under the Securities Act, except for any such shares which may be acquired by our "affiliates" as that term is defined in Rule 144 under the Securities Act. Any shares held by an affiliate may not be resold except pursuant to an effective registration statement or an applicable exemption from registration, including an exemption under Rule 144 of the Securities Act. In general, Rule 144 limits the number of shares that an affiliate of ours can sell within any three-month period to the greater of 1% of the then outstanding shares of our common stock and the average weekly trading volume of our common stock during the four calendar weeks preceding the sale. Rule 144 also imposes various restrictions on the manner in which our affiliates may sell their shares. The Thomas H. Lee entities, our other institutional investors and our directors and executive officers will own a total of shares of common stock, representing approximately % of our common stock to be outstanding after this offering. These stockholders and the selling stockholders have agreed with the underwriters not to dispose of or hedge any of our common stock or securities convertible into or exchangeable for shares of common stock during the period from the date of this prospectus continuing through the date 90 days after the date of this prospectus, without the prior written consent of Goldman, Sachs & Co. After this lock-up period, these stockholders will be free to sell their shares, subject to the volume limitations of Rule 144 and the restrictions on transfer contained in our investors' agreement that are described below. In addition, some of these stockholders have the registration rights under our investors' agreement that are described below. We cannot predict when these stockholders may sell their shares or in what volumes, because this will depend on the market for our common stock, the circumstances of the sellers and other factors. However, the market price for our common stock could decline significantly if these stockholders sell a large number of shares into the public market after this offering or if the market believes that these sales may occur. INVESTORS' AGREEMENT In connection with the investment in us by the Thomas H. Lee entities, we entered into an investors' agreement with the Thomas H. Lee entities, our other institutional investors, members of our management and other individual stockholders. In addition to providing for the size and composition of our board of directors, and the preemptive right to purchase additional shares of our capital stock under certain circumstances, the investors' agreement contains restrictions on transfer of shares held by the parties to the agreement and registration rights. Transfers by the Thomas H. Lee entities are generally subject to tag-along rights, which means that other parties to the agreement can sell some of their shares to the same entity that purchases shares from the Thomas H. Lee entities. Transfers by institutional investors are generally subject to limitations based on transfers made by Thomas H. Lee entities. The restrictions on transfers by our management stockholders, other than transfers to persons adverse to the company, will lapse upon completion of this offering. The parties to the investors' agreement have registration rights allowing them to cause us to register their shares with the SEC for resale under the Securities Act. The Thomas H. Lee entities have demand registration rights under which they can require us to register for sale shares of common stock on up to six occasions. After two such demands are made, a majority of the institutional investors may require us to register for sale common stock held by them. Mr. Montrone and Mr. Meister have demand registration rights after more than 20% of the original investment of the Thomas H. Lee entities and the institutional investors has been transferred. In addition, the parties to the investors' agreement have registration rights which allow them to include their shares in some other registration statements that we may file with the SEC. 52 UNDERWRITING We, the selling stockholders and the underwriters for the offering named below have entered into an underwriting agreement with respect to the shares being offered. Subject to certain conditions, each underwriter has severally agreed to purchase from the selling stockholders the number of shares indicated in the following table.
Number of Underwriters Shares ------------ --------- Goldman, Sachs & Co. ....................................... Credit Suisse First Boston Corporation...................... J.P. Morgan Securities Inc.................................. Merrill Lynch, Pierce, Fenner & Smith Incorporated................................... Morgan Stanley & Co. Incorporated........................... --------- Total............................................. 6,500,000 =========
The underwriters are committed to take and pay for all of the shares being offered, if any are taken, other than the shares covered by the option described below unless and until this option is exercised. If the underwriters sell more shares than the total number set forth in the table above, the underwriters have an option to buy up to an additional 975,000 shares from the selling stockholders to cover such sales. They may exercise that option for 30 days. If any shares are purchased pursuant to this option, the underwriters will severally purchase shares in approximately the same proportion as set forth in the table above. The following table shows the per share and total underwriting discounts and commissions to be paid to the underwriters by the selling stockholders. Such amounts are shown assuming both no exercise and full exercise of the underwriters' option to purchase 975,000 additional shares.
Paid by the Selling Stockholders No Exercise Full Exercise -------------------------------- ----------- ------------- Per Share................................................... $ $ Total....................................................... $ $
Shares sold by the underwriters to the public will initially be offered at the public offering price set forth on the cover of this prospectus. Any shares sold by the underwriters to securities dealers may be sold at a discount of up to $ per share from the initial price to public. Any such securities dealers may resell any shares purchased from the underwriters to certain other brokers or dealers at a discount of up to $ per share from the initial price to public. If all the shares are not sold at the initial price to public, the representatives may change the offering price and the other selling terms. We, the selling stockholders and each of our officers and directors have agreed with the underwriters not to dispose of or hedge any of our common stock or securities convertible into or exchangeable for shares of common stock during the period from the date of this prospectus continuing through the date 90 days after the date of this prospectus, except with the prior written consent of Goldman, Sachs & Co. This agreement does not apply to our employee benefit plans. Our common stock is listed on the New York Stock Exchange under the symbol "FSH." In connection with this offering, the underwriters may purchase and sell shares of common stock in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by the underwriters of a greater number of shares than they are required to purchase in the offering. 53 "Covered" short sales are sales made in an amount not greater than the underwriters' option to purchase additional shares from the selling stockholders in this offering. The underwriters may close out any covered short position by either exercising their option to purchase additional shares or purchasing shares in the open market. In determining the source of shares to close out the covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase shares through the overallotment option. "Naked" short sales are any sales in excess of such option. The underwriters must close out any naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the common stock in the open market after pricing that could adversely affect investors who purchase in this offering. Stabilizing transactions consist of certain bids or purchases made for the purpose of preventing or retarding a decline in the market price of the common stock while the offering is in progress. The underwriters also may impose a penalty bid. This occurs when a particular underwriter repays to the underwriters a portion of the underwriting discount received by it because the representatives have repurchased shares sold by or for the account of such underwriter in stabilizing or short covering transactions. Purchases to cover a short position and stabilizing transactions may have the effect of preventing or retarding a decline in the market price of our stock, and together with the imposition of the penalty bid, may stabilize, maintain or otherwise affect the market price of the common stock. As a result, the price of common stock may be higher than the price that otherwise might exist in the open market. If these activities are commenced, they may be discontinued at any time. These transactions may be effected on the NYSE, in the over-the-counter market or otherwise. A prospectus in electronic format may be made available on the websites maintained by one or more of the representatives and may also be made available on websites maintained by other underwriters. The underwriters may agree to allocate a number of shares to underwriters for sale to their online brokerage account holders. Internet distributions will be allocated by the representatives to underwriters that may make Internet distributions on the same basis as other allocations. We and the selling stockholders estimate that their shares of the total expenses of this offering, excluding underwriting discounts and commissions, will be approximately $ and $ , respectively. We and the selling stockholders have agreed to indemnify the several underwriters against certain liabilities, including liabilities under the Securities Act of 1933. Credit Suisse First Boston Corporation, J.P. Morgan Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated are among the underwriters. Because of the ownership interests that affiliates of these underwriters have in us, this offering is being conducted in accordance with Rule 2720 of the National Association of Securities Dealers, Inc. Certain of the underwriters and their affiliates have in the past provided, and may in the future from time to time provide, commercial or investment banking services to us, for which they have in the past received, and may in the future receive, customary fees. Affiliates of some of the underwriters, including affiliates of J.P. Morgan Securities Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated and Credit Suisse First Boston Corporation, are lenders under our bank credit agreement. Affiliates of J.P. Morgan Securities Inc. act as the administrative agent, Canadian administrative agent and U.K. administrative agent under that agreement. An affiliate of Merrill Lynch, Pierce, Fenner & Smith Incorporated acts as syndication agent and an affiliate of Credit Suisse First Boston Corporation acts as documentation agent. Affiliates of J.P. Morgan Securities Inc. act as funding agent under our receivables securitization facility. 54 WHERE YOU CAN FIND MORE INFORMATION We have filed with the SEC a registration statement under the Securities Act with respect to the shares to be sold in this offering. As permitted by the rules and regulations of the SEC, this prospectus omits some information contained in the registration statement. For further information with respect to us and the common stock to be sold in the offering, you should refer to the registration statement and to its exhibits and schedules. Statements contained in this prospectus regarding the contents of any agreement or other document are not necessarily complete. You should refer in each instance to the copy of the agreement or other document filed or incorporated by reference as an exhibit to the registration statement, each such statement being qualified in all respects by the document to which it refers. We are also required to file annual, quarterly and special reports, proxy statements and other information with the SEC. You can read the registration statement and the exhibits and schedules filed with the registration statement or any reports, statements or other information we have filed or file, at the public reference facilities maintained by the SEC at 450 Fifth Street, N.W., Judiciary Plaza, Room 1024, Washington, D.C. 20549. Copies of such material can also be obtained at prescribed rates by mail from the Public Reference Section of the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference services. In addition, the SEC maintains a website (http://www.sec.gov) that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC. You may also inspect our SEC reports and other information at the New York Stock Exchange, 20 Broad Street, New York, New York 10005. INCORPORATION BY REFERENCE This prospectus is part of the registration statement that we filed with the SEC. The SEC permits us to incorporate by reference the information that we file with them, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is considered to be part of this prospectus, and information that we subsequently file with the SEC will automatically update and supersede this information. We incorporate by reference the documents listed below filed by us with the SEC: - Our annual report on Form 10-K for the fiscal year ended December 31, 2000; - Our quarterly reports on Form 10-Q for the quarters ended March 31, 2001, June 30, 2001 and September 30, 2001; - The description of our common stock contained in our Registration Statement on Form 8-A, filed on November 7, 1991; and - Our current reports on Form 8-K filed on April 26, 2001, and Form 8-K filed on November 13, 2001, as amended by Form 8-K/A filed on January 11, 2002. We also incorporate by reference any future filings made with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 after the initial filing of the registration statement until the termination of this offering. If you request a copy of any or all of the documents incorporated by reference, we will send to you the copies requested at no charge. However, we will not send exhibits to such documents unless such exhibits are specifically incorporated by reference in such documents. You should direct requests for such copies to: Secretary, Fisher Scientific International Inc., One Liberty Lane, Hampton, New Hampshire 03842. 55 LEGAL MATTERS The validity of the securities offered under this registration statement will be passed upon for us by Skadden, Arps, Slate, Meagher & Flom LLP. Hale and Dorr LLP, New York, New York, will pass upon certain legal matters in connection with this offering for the underwriters. EXPERTS The financial statements and the related financial statement schedule incorporated in this prospectus by reference from Fisher Scientific International Inc.'s Annual Report on Form 10-K for the year ended December 31, 2000, have been audited by Deloitte & Touche LLP, independent auditors, as stated in their reports, which are incorporated herein by reference, and have been so incorporated in reliance upon the reports of such firm given upon their authority as experts in accounting and auditing. The financial statements of Cole-Parmer Instrument Company and Affiliates as of and for the fiscal year ended March 31, 2001, incorporated in this prospectus by reference from Fisher Scientific International Inc.'s Current Report on Form 8-K filed on January 11, 2002, have been audited by Deloitte & Touche LLP, independent auditors, as stated in their report, which is incorporated herein by reference, and has been so incorporated in reliance upon the report of such firm given upon their authority as experts in accounting and auditing. The financial statements of Cole-Parmer Instrument Company and Affiliates as of March 31, 2000, and for each of the two fiscal years in the period ended March 31, 2000, incorporated in this prospectus by reference from Fisher Scientific International Inc.'s Current Report on Form 8-K filed on January 11, 2002, have been audited by Warady & Davis LLP, independent auditors, as stated in their report, which is incorporated herein by reference, and has been so incorporated in reliance upon the report of such firm given upon their authority as experts in accounting and auditing. 56 - ------------------------------------------------------ - ------------------------------------------------------ No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus. You must not rely on any unauthorized information or representations. This prospectus is an offer to sell only the shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date. --------------------- TABLE OF CONTENTS
Page ---- Prospectus Summary.................... 1 Risk Factors.......................... 6 Special Note Regarding Forward-looking Information......................... 11 Use of Proceeds....................... 11 Price Range of Common Stock........... 12 Dividend Policy....................... 12 Capitalization........................ 13 Selected Financial Data............... 14 Unaudited Pro Forma Combined Financial Information......................... 17 Management's Discussion and Analysis of Financial Condition and Results of Operations....................... 24 Business.............................. 34 Management............................ 41 Principal and Selling Stockholders.... 43 Description of Capital Stock.......... 48 Shares Eligible for Future Sale....... 52 Underwriting.......................... 53 Where You Can Find More Information... 55 Incorporation by Reference............ 55 Legal Matters......................... 56 Experts............................... 56
- ------------------------------------------------------ - ------------------------------------------------------ - ------------------------------------------------------ - ------------------------------------------------------ 6,500,000 Shares FISHER SCIENTIFIC INTERNATIONAL INC. Common Stock ---------------------------- PROSPECTUS ---------------------------- GOLDMAN, SACHS & CO. CREDIT SUISSE FIRST BOSTON JPMORGAN MERRILL LYNCH & CO. MORGAN STANLEY - ------------------------------------------------------ - ------------------------------------------------------ PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION The following sets forth the expenses in connection with the issuance and distribution of the securities being registered, other than underwriting discounts and commissions. All such expenses shall be borne by us. All amounts set forth below are estimates, other than the SEC registration fee. SEC Registration Fee........................................ $ 20,975 NASD Filing Fee............................................. 23,299 Legal Fees and Expenses..................................... * Transfer Agent and Registrar Fees and Expenses.............. * Accounting Fees and Expenses................................ 150,000 Blue Sky Fees Expenses (including counsel fees)............. * Printing Expenses........................................... * Miscellaneous............................................... * -------- TOTAL............................................. $ * ========
- --------------- * To be supplied by amendment. ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS Section 145 of the Delaware General Corporation Law, as amended, provides in regards to indemnification of directors and officers as follows: "145 INDEMNIFICATION OF OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS; INSURANCE. (a) A corporation shall have power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful. (b) A corporation shall have power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys' fees) actually and reasonably incurred by the person in connection with the II-1 defense or settlement of such action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper. (c) To the extent that a present or former director or officer of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in subsections (a) and (b) of this section, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by such person in connection therewith. (d) Any indemnification under subsections (a) and (b) of this section (unless ordered by a court) shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances because the person has met the applicable standard of conduct set forth in subsections (a) and (b) of this section. Such determination shall be made, with respect to a person who is a director or officer at the time of such determination (1) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, or (2) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, or (3) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion, or (4) by the stockholders. (e) Expenses (including attorney's fees) incurred by an officer or director in defending any civil, criminal, administrative or investigative action, suit or proceeding may be paid by the corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the corporation as authorized in this section. Such expenses (including attorneys' fees) incurred by former directors and officers or other employees and agents may be so paid upon such terms and conditions, if any, as the corporation deems appropriate. (f) The indemnification and advancement of expenses provided by, or granted pursuant to the other subsections of this section shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in such person's official capacity and as to action in another capacity while holding such office. (g) A corporation shall have power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person's status as such, whether or not the corporation would have the power to indemnify such person against such liability under this section. (h) For purposes of this section, references to "the corporation" shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, and II-2 employees or agents, so that any person who is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under this section with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued. (i) For purposes of this section, references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on a person with respect to any employee benefit plan; and references to "serving at the request of the corporation" shall include any service as a director, officer, employee or agent of the corporation which imposes duties on, or involves services by, such director, officer, employee, or agent with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner "not opposed to the best interests of the corporation" as referred to in this section. (j) The indemnification and advancement of expenses provided by, or granted pursuant to, this section shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person." ARTICLE FIFTEENTH of Fisher's Certificate of Incorporation provides as follows: FIFTEENTH: (a) A director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware General Corporation Law, or (iv) for any transaction from which the director derived an improper personal benefit. (b)(1) Right to 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 the 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 or inaction 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, 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; PROVIDED, HOWEVER, that, except as provided in this paragraph (b), 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 II-3 indemnification conferred in this paragraph (b) 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 of the Corporation (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 only 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 Section or otherwise. 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. (2) Right of Claimant to Bring Suit. If a claim under subparagraph (b)(1) is not paid in full by the Corporation within 30 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 proceedings 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 or 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, shall be a defense to the action or create a presumption that the claimant has not met the applicable standard or conduct. (3) Non-Exclusivity of Rights. The right to indemnification and the payment of expenses incurred in defending a proceeding in advance of its final disposition conferred in this paragraph (b) 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, bylaw, agreement, vote of stockholders or disinterested directors or otherwise. (4) Insurance. The Corporation may maintain insurance, at its expense, to project 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. II-4 ITEM 16. EXHIBITS
EXHIBIT NUMBER DESCRIPTION - ------- ----------- 1 Form of Underwriting Agreement.* 4.1 Specimen Certificate of Common Stock, $.01 par value per share, of the Company. Incorporated by reference to Exhibit 5 to the Company's Registration Statement on Form 8-A filed on November 7, 1991. 4.2 Certificate of Designation of Non-Voting Stock. Incorporated by reference to Exhibit 3.3 to the Company's Annual Report on Form 10-K filed on March 31, 1999. 4.3 Certificate of Designation of Series B Non-Voting Common Stock. Incorporated by reference to Exhibit 3.4 to the Company's Annual Report on Form 10-K filed on March 31, 1999. 4.4 Amended and Restated Investors' Agreement dated March 29, 1999 (the "Investors' Agreement") among the Company and (i) Thomas H. Lee Equity Fund III, L.P. ("THL"), certain individuals associated with THL, THL-CCI Limited Partnership, THL Foreign Fund III L.P., and THL FSI Equity Investors, L.P., (ii) DLJ Merchant Banking Partners II, L.P., DLJ Offshore Partners II, C.V., DLJ Diversified Partners, L.P., DLJMB Funding II, Inc., DLJ Merchant Banking Partners II-A, L.P., DLJ Diversified Partners-A, L.P., DLJ Millennium Partners, L.P., DLJ Millennium Partners-A, L.P., UK Investment Plan 1997 Partners, DLJ EAB Partners, L.P., DLJ ESC II, L.P. and DLJ First ESC, L.P., (iii) Chase Equity Associates, L.P. ("Chase Equity") and (iv) Merrill Lynch KECALP L.P. 1997, KECALP Inc., and ML IBK Positions, Inc. Incorporated by reference to Exhibit 10.7 to the Company's Annual Report on Form 10-K for the year ended December 31, 1998 filed on March 31, 1999. 4.5 Amendment No. 1 to the Investors' Agreement dated May 14, 2000. Incorporated by reference to Exhibit 10.17 to the Company's Annual Report on Form 10-K for the year ended December 31, 2000 filed on March 29, 2001. 4.6 Amendment No. 2 to the Investors' Agreement dated May 2, 2001. Incorporated by reference to Exhibit 10.19 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2001 filed on May 15, 2001. 4.7 Credit Agreement among Fisher, Certain Subsidiaries of Fisher, Various Lending Institutions, The Chase Manhattan Bank, as Administrative Agent, The Chase Manhattan Bank of Canada, as Administrative Agent, Chase Manhattan International Limited, as U.K. Administrative Agent, Merrill Lynch Capital Corporation, as Syndication Agent, and DLJ Capital Funding, Inc., as Documentation Agent, dated as of January 21, 1998 (the "Credit Agreement"). Incorporated by reference to Exhibit 3 to the Company's Current Report on Form 8-K dated January 21, 1998, filed on February 6, 1998. 4.8 First Amendment and Waiver to the Credit Agreement dated as of November 13, 1998 and Second Amendment and Waiver to the Credit Agreement dated as of December 31, 1998. Incorporated by reference to Exhibits 10.5 and 10.6 respectively of the Company's Annual Report on Form 10-K for the year ended December 31, 1998 filed on March 31, 1999. 4.9 Third Amendment and Waiver to the Credit Agreement dated as of April 15, 2000 and Fourth Amendment and Waiver to the Credit Agreement dated as of February 9, 2001. Incorporated by reference to Exhibits 10.5 and 10.6 respectively of the Company's Annual Report on Form 10-K for the year ended December 31, 2000 filed on March 29, 2001. 4.10 Fifth Amendment and Consent to the Credit Agreement dated as of October 15, 2001. 5.1 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP related to the shares of common stock being offered.* 23.1 Consent of Deloitte & Touche LLP. 23.2 Consent of Deloitte & Touche LLP. 23.3 Consent of Warady & Davis LLP. 23.4 Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in Exhibit 5.1).* 24 Powers of Attorney (included in signature page of this Registration Statement).
- --------------- * To be filed by amendment. II-5 ITEM 17. UNDERTAKINGS The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. The undersigned registrant hereby undertakes that: (1) For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424 (b) (1) or (4) or 497 (h) under the Securities Act shall be deemed to be part of this Registration Statement as of the time it was declared effective. (2) For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new Registration Statement relating to the securities offered therein and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. II-6 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Hampton, State of New Hampshire, on this 18th day of January, 2002. Fisher Scientific International Inc. By /s/ TODD M. DUCHENE ------------------------------------ Todd M. DuChene Vice President, General Counsel and Secretary KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Paul M. Meister, Todd M. DuChene, and Kevin P. Clark, or any of them, his true and lawful attorney-in-fact and agent, with full power of substitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments and any related Registration Statement filed pursuant to Rule 462(b)) to this Registration Statement and to file the same with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and ratifying and confirming all that said attorney-in-fact and agent or his substitute or substitutes may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities with Fisher Scientific International Inc. and on the date indicated.
NAME TITLE DATE ---- ----- ---- /s/ PAUL M. MONTRONE Chairman of the Board and January 18, 2002 - --------------------------------------------------- Chief Executive Officer Paul M. Montrone /s/ PAUL M. MEISTER Vice Chairman of the Board January 18, 2002 - --------------------------------------------------- Paul M. Meister /s/ KEVIN P. CLARK Vice President and Chief January 18, 2002 - --------------------------------------------------- Financial Officer Kevin P. Clark /s/ MITCHELL J. BLUTT Director January 18, 2002 - --------------------------------------------------- Mitchell J. Blutt /s/ MICHAEL D. DINGMAN Director January 18, 2002 - --------------------------------------------------- Michael D. Dingman
II-7
NAME TITLE DATE ---- ----- ---- /s/ ANTHONY J. DINOVI Director January 18, 2002 - --------------------------------------------------- Anthony J. DiNovi /s/ DAVID V. HARKINS Director January 18, 2002 - --------------------------------------------------- David V. Harkins /s/ SCOTT M. SPERLING Director January 18, 2002 - --------------------------------------------------- Scott M. Sperling /s/ KENT R. WELDON Director January 18, 2002 - --------------------------------------------------- Kent R. Weldon
II-8 EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION - ------- ----------- 1 Form of Underwriting Agreement.* 4.1 Specimen Certificate of Common Stock, $.01 par value per share, of the Company. Incorporated by reference to Exhibit 5 to the Company's Registration Statement on Form 8-A filed on November 7, 1991. 4.2 Certificate of Designation of Non-Voting Stock. Incorporated by reference to Exhibit 3.3 to the Company's Annual Report on Form 10-K filed on March 31, 1999. 4.3 Certificate of Designation of Series B Non-Voting Common Stock. Incorporated by reference to Exhibit 3.4 to the Company's Annual Report on Form 10-K filed on March 31, 1999. 4.4 Amended and Restated Investors' Agreement dated March 29, 1999 (the "Investors' Agreement") among the Company and (i) Thomas H. Lee Equity Fund III, L.P. ("THL"), certain individuals associated with THL, THL-CCI Limited Partnership, THL Foreign Fund III, L.P., and THL FSI Equity Investors, L.P., (ii) DLJ Merchant Banking Partners II, L.P., DLJ Offshore Partners II, C.V., DLJ Diversified Partners, L.P., DLJMB Funding II, Inc., DLJ Merchant Banking Partners II-A, L.P., DLJ Diversified Partners-A, L.P., DLJ Millennium Partners, L.P., DLJ Millennium Partners-A, L.P., UK Investment Plan 1997 Partners, DLJ EAB Partners, L.P., DLJ ESC II, L.P. and DLJ First ESC, L.P., (iii) Chase Equity Associates, L.P. ("Chase Equity") and (iv) Merrill Lynch KECALP L.P. 1997, KECALP Inc., and ML IBK Positions, Inc. Incorporated by reference to Exhibit 10.7 to the Company's Annual Report on Form 10-K for the year ended December 31, 1998 filed on March 31, 1999. 4.5 Amendment No. 1 to the Investors' Agreement dated May 14, 2000. Incorporated by reference to Exhibit 10.17 to the Company's Annual Report on Form 10-K for the year ended December 31, 2000 filed on March 29, 2001. 4.6 Amendment No. 2 to the Investors' Agreement dated May 2, 2001. Incorporated by reference to Exhibit 10.19 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2001 filed on May 15, 2001. 4.7 Credit Agreement among Fisher, Certain Subsidiaries of Fisher, Various Lending Institutions, The Chase Manhattan Bank, as Administrative Agent, The Chase Manhattan Bank of Canada, as Administrative Agent, Chase Manhattan International Limited, as U.K. Administrative Agent, Merrill Lynch Capital Corporation, as Syndication Agent, and DLJ Capital Funding, Inc., as Documentation Agent, dated as of January 21, 1998 (the "Credit Agreement"). Incorporated by reference to Exhibit 3 to the Company's Current Report on Form 8-K dated January 21, 1998, filed on February 6, 1998. 4.8 First Amendment and Waiver to the Credit Agreement dated as of November 13, 1998 and Second Amendment and Waiver to the Credit Agreement dated as of December 31, 1998. Incorporated by reference to Exhibits 10.5 and 10.6 respectively of the Company's Annual Report on Form 10-K for the year ended December 31, 1998 filed on March 31, 1999. 4.9 Third Amendment and Waiver to the Credit Agreement dated as of April 15, 2000 and Fourth Amendment and Waiver to the Credit Agreement dated as of February 9, 2001. Incorporated by reference to Exhibits 10.5 and 10.6 respectively of the Company's Annual Report on Form 10-K for the year ended December 31, 2000 filed on March 29, 2001. 4.10 Fifth Amendment and Consent to the Credit Agreement dated as of October 15, 2001. 5.1 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP related to the shares of common stock being offered.* 23.1 Consent of Deloitte & Touche LLP. 23.2 Consent of Deloitte & Touche LLP. 23.3 Consent of Warady & Davis LLP. 23.4 Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in Exhibit 5.1).* 24 Powers of Attorney (included in signature page of this Registration Statement).
- --------------- * To be filed by amendment. EX-4.10 3 l92310ex4-10.txt FIFTH AMENDMENT AND CONSENT TO CREDIT AGREEMENT EXHIBIT 4.10 FIFTH AMENDMENT AND CONSENT (this "Amendment") dated as of October 15, 2001 to the Credit Agreement dated as of January 21, 1998 (as previously amended, the "Credit Agreement"), among FISHER SCIENTIFIC INTERNATIONAL INC. (the "Company"), certain Subsidiaries of the Company, the lenders from time to time party thereto (the "Banks"), THE CHASE MANHATTAN BANK, as Administrative Agent, THE CHASE MANHATTAN BANK OF CANADA, as Canadian Administrative Agent, CHASE MANHATTAN INTERNATIONAL LIMITED, as U. K. Administrative Agent, MERRILL LYNCH CAPITAL CORPORATION, as Syndication Agent and DLJ CAPITAL FUNDING, INC. as Documentation Agent. A. Capitalized terms used and not otherwise defined herein shall have the meanings assigned to them in the Credit Agreement, as amended hereby. B. The Company intends to restructure the ownership of its Foreign Subsidiaries by creating holding companies below Fisher Scientific Worldwide Holdings C.V. ("Fisher C.V.") that will own all of the Equity Interests of Fisher Limited (as defined below) which will act as a holding company for most of the Company's European Subsidiaries by means of a series of transactions pursuant to which, inter alia, (i) the Company will create (a) two unlimited liability companies organized under the laws of Nova Scotia (the "ULCs"), all of the Equity Interests of which will be owned by Fisher C.V. and each of which will be a Foreign Subsidiary, (b) a limited partnership organized under the laws of New Brunswick ("Canada LP") all of the Equity Interests of which will be owned by the ULCs and which will be a Foreign Subsidiary and (c) two companies organized under the laws of Barbados and Luxembourg, each of which will be wholly-owned Subsidiaries of Fisher Limited; (ii) the Company will cause (a) Fisher C.V. to transfer all of the Equity Interests of Fisher Scientific Limited, an Ontario corporation, to Canada LP and change the form of Fisher Scientific Limited to a Nova Scotia unlimited liability company (prior to and following such change of form, "Fisher Limited") and (b) cause all of the Equity Interests of Fisher Scientific Europe Holdings B.V. ("Fisher Europe") and certain other Foreign Subsidiaries to be transferred to Fisher Limited or one of its Wholly-Owned Subsidiaries; (iii) certain promissory notes of Foreign Subsidiaries currently held by Fisher C.V. will be transferred to Fisher Limited and/or other Foreign Subsidiaries of the Company, including the newly formed Subsidiaries organized under the laws of Barbados and Luxembourg; (iv) the Liens created under the Pledge Agreement over the Equity Interests of Foreign Subsidiaries listed on Schedule 1 hereto and the guarantees made under the Guarantee Agreement of the Foreign Subsidiaries listed on Schedule 2 hereto will be released (the "Release"); and (v) 65% of the equity interests in Canada LP will be pledged to the Collateral Agent to secure the Obligations. The foregoing transactions, including the Release, are sometimes referred to hereinafter as the "Tax Restructuring" and are more fully described in the summary description thereof attached hereto as Exhibit A. Attached hereto as Exhibits B and C are diagrams setting forth the corporate structure of the Company and its Subsidiaries subject to the Tax Restructuring (a) prior to the Tax Restructuring and (b) after giving effect to the Tax Restructuring, respectively. C. The Company has requested that the Banks amend certain provisions of the Credit Agreement and consent to and approve the Tax Restructuring. D. The Required Banks are willing to so amend the Credit Agreement and consent to and approve the Tax Restructuring, in each case subject to the terms and conditions set forth herein. Accordingly, the parties hereto agree as follows: SECTION 1. Amendments. (a) Amendments to Section 4.02 (Mandatory Repayments and Prepayments). Clause (d) of Section 4.02(A) is amended by (i) inserting the following text immediately after the text in the second parenthetical therein: "except any issuance of Additional Senior Subordinated Notes" and (ii) inserting the following text immediately after the text "as set forth in Section 4.02(C))": "; provided, however, that the Company shall not be required to so apply the cash proceeds (net of underwriting discounts and commissions and other reasonable costs associated therewith) of issuances of Additional Senior Subordinated Notes in an aggregate principal amount not to exceed $200,000,000 during the term of this Agreement, so long as on or immediately prior to the date of the Company's receipt of such net cash proceeds upon any issuance of Additional Senior Subordinated Notes (1) no Default or Event of Default has occurred and is continuing, (2) the Company has delivered an officer's certificate of the Company to the Administrative Agent certifying that such net cash proceeds shall be used solely to finance a Permitted Acquisition or Permitted Acquisitions within 180 days of the date of such issuance, and (3) the Company and its Subsidiaries are in compliance, on a pro forma basis after giving effect to such incurrence of Indebtedness and such Permitted Acquisition or Permitted Acquisitions, with the covenants contained in Sections 8.09, 8.10, 8.11 and 8.12, and provided further, that (1) 2 if all or any portion of the net cash proceeds upon any issuance of Additional Senior Subordinated Notes not required to be applied to the mandatory repayment of outstanding Term Loans pursuant to the preceding proviso are not used (or contractually committed to be used) to finance a Permitted Acquisition or Permitted Acquisitions within 180 days after such issuance of Additional Senior Subordinated Notes, such remaining portion shall be applied on the last day of such period as a mandatory repayment of outstanding Term Loans as provided above in this Section 4.02(A)(d) and (2) if all or any portion of such proceeds are not required to be applied on the 180th day referred to in clause (1) immediately above because such amount is contractually committed to be used, and subsequent to such date such contract is terminated or expires without such portion being so used, such remaining portion shall be applied on the date of such termination or expiration as a mandatory repayment of outstanding Term Loans as provided in this Section 4.02(A)(d) .". (b) Amendments to Section 8.02 (Consolidation, Merger, Sale or Purchase of Assets, etc.). Clause (1) of Section 8.02 of the Credit Agreement is amended by (i) replacing the amount "$50,000,000" with "$75,000,000" and (ii) inserting the following text at the end of such clause, immediately preceding the semicolon: "(for clarification, to the extent that any Subsidiary so acquired becomes a Wholly-Owned Subsidiary pursuant to subsequent investments and purchases of equity interests permitted hereunder at any time after such acquisition, consideration for, and other investments in, such Subsidiary need not be included thereafter for the purpose of determining compliance with the $75,000,000 aggregate investment limitation)". (c) Amendments to Section 8.03 (Liens). Section 8.03 of the Credit Agreement is amended by: (i) replacing the amount "$30,000,000" in clause (o) thereof with "40,000,000"; (ii) replacing the word "and" at the end of clause (r) thereof with a semicolon; and (iii) deleting the period at the end of clause (s) inserting the following text immediately thereafter: "; and 3 (t) Liens over bank accounts maintained at the Cash Pooling Bank by Foreign Subsidiaries; provided that such Liens shall secure only the obligations of the Foreign Subsidiaries under the Cash Pooling Agreement.". (d) Amendments to Section 8.04 (Indebtedness). Section 8.04 of the Credit Agreement is amended by: (i) (1) replacing the text "(B)" in the proviso to clause (c) thereof with "and"; (2) inserting the following immediately preceding the text "and (C)" in such proviso: ", (B) the Additional Senior Subordinated Notes will not amortize principal thereof or mature prior to six months after the date of the termination of this Agreement and the payment in full of all of the Obligations,"; (3) replacing the amount "$600,000,000" in such proviso with "$800,000,000"; and (4) inserting the following text at the end of such proviso, immediately preceding the semicolon: "; provided further, that if, after giving effect to the issuance of any Senior Subordinated Notes, the outstanding aggregate principal amount of the Senior Subordinated Notes exceeds $600,000,000, the net cash proceeds of the issuance of such Senior Subordinated Notes (the "Additional Senior Subordinated Notes") shall be applied to the mandatory prepayment of the Term Loans as provided in Section 4.02(A)(d)"; (ii) inserting the following text immediately preceding the text ", provided" in clause (e) thereof: "and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof plus accrued interest thereon and fees and expenses reasonably incurred in connection therewith or result in an earlier maturity date or decreased weighted average life thereon"; (iii) replacing the amount "$30,000,000" in clause (k) thereof with "$50,000,000"; (iv) inserting the following text immediately preceding the text ", provided" in clause (j) thereof: 4 "and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof plus accrued interest thereon and fees and expenses reasonably incurred in connection therewith or result in an earlier maturity date or decreased weighted average life thereon"; (v) replacing clause (1) thereof in its entirety with the following: "Indebtedness of the Company and its Subsidiaries incurred pursuant to any Permitted Receivables Financing and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof plus accrued interest thereon and fees and expenses reasonably incurred in connection therewith or result in an earlier maturity date or decreased weighted average life thereon"; and (vi) deleting the period at the end of clause (m) and inserting the following text immediately thereafter: "; and (n) Indebtedness constituting a guaranty by the Company of the obligations of the Foreign Subsidiaries to the Cash Pooling Bank under the Cash Pooling Agreement.". (e) Amendments to Section 8.06 (Advances, Investment and Loans). Clause (o) of Section 8.06 of the Credit Agreement is amended by: (i) inserting the following text immediately after the text "may invest in Persons": ", including Subsidiaries,"; (ii) replacing the amount "$50,000,000" with "$75, 000,000"; (iii) inserting the following text at the end of the text of the parenthetical therein: "; for clarification, to the extent that any Person in which an investment is made under this clause (o) becomes a Wholly-Owned Subsidiary of the Company, such investment need not be included thereafter for the purpose of determining compliance with the $75,000,000 aggregate investment limitation"; and (iv) inserting the following text at the end of such clause immediately preceding the period: 5 "; provided further that if any Person would become a Subsidiary of the Company pursuant to any investment proposed to be made under this clause, such investment shall be subject to the conditions precedent contained in Section 8.02(1) (except those conditions contained in the second proviso thereto)". (f) Amendments to Section 8.07 (Dividends, etc.). Section 8.07 of the Credit Agreement is amended by (i) deleting the word "and" at the end of clause (h) thereof, (ii) replacing the amount "$10,000,000" in clause (i) thereof with "$20,000,000", (iii) deleting the period at the end of the clause (i) thereof and (iv) and inserting the following text immediately after clause (i) thereof: "; and (j) the Company and each Wholly-Owned Subsidiary may, if otherwise permitted by Section 8.06(o) or Section 8.02(1), purchase capital stock of any Subsidiary, and any Subsidiary directly owned by the Company or a Wholly-Owned Subsidiary of the Company may, if otherwise permitted by Section 8.06(o) or Section 8.02(1), effect a redemption, repurchase, cancellation or other retirement for value of its own capital stock." (g) Amendment to Section 8.14 (Limitation on Certain Restrictions on Subsidiaries). Section 8.14 is replaced in its entirety with the following text: "SECTION 8.14. Limitation on Certain Restrictions on Subsidiaries. The Company will not, and will not permit any Subsidiary to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of the Company or any Subsidiary to create, incur or permit to exist any Lien upon any of its property or assets, or (b) the ability of any Subsidiary to pay dividends or other distributions with respect to any shares of its capital stock or to make or repay loans or advances to the Company or any other Subsidiary or to guarantee Indebtedness of the Company or any other Subsidiary; provided that (i) the foregoing shall not apply to restrictions and conditions imposed by law or by any Credit Document or Senior Subordinated Note Document, (ii) the foregoing shall not apply to restrictions and conditions imposed by any Existing Indebtedness Agreement or by reason of any Permitted Receivables Transaction (but shall apply to any extension or renewal of, or any amendment or modification expanding the scope of, any such restriction or condition), (iii) the foregoing shall not apply to customary restrictions and 6 conditions contained in agreements relating to the sale of a Subsidiary pending such sale, provided such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder, (iv) clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted under Sections 8.04(e), 8.04(j), 8.04(1) or 8.04(n), in each case if such restrictions or conditions apply only to the property or assets securing such Indebtedness and (v) clause (a) of the foregoing shall not apply to customary provisions in leases and licensing agreements restricting the assignment thereof.". (h) Amendments to Section 8.15 (Limitation on the Creation of Subsidiaries). Section 8.15 of the Credit Agreement is amended by (i) inserting the following text immediately after the text "clause (1) of Section 8.02" in the first parenthetical in the proviso thereto: "or created or capitalized by investments in an aggregate amount at any time of up to $50,000,000 permitted by the provisions of clause (o) of Section 8.06"; and (ii) replacing the text of the parenthetical in clause (a)(iii) of the proviso thereto in its entirety with the following text: "other than (i) Foreign Subsidiaries except to the extent otherwise required pursuant to Section 7.12 (Foreign Subsidiary Security) and (ii) Subsidiaries capitalized pursuant to Section 8.06(o) to the extent that the aggregate investment in such Subsidiaries made pursuant to 8.06(o) does not exceed $50,000,000 at any time". (i) Amendments to Section 10 (Definitions). Section 10(A) of the Credit Agreement is amended by: (i) replacing the amount "$30,000,000" in the definition of the term "Local Letter of Credit Sublimit" with "$40,000,000"; and (ii) inserting the following definitions in the appropriate alphabetical order: "Additional Senior Subordinated Notes" shall have the meaning provided in Section 8.04(c). "Cash Pooling Agreement" shall mean the cash pooling agreement to be entered by the Company and the Foreign Subsidiaries regarding the consolidation of the bank accounts of certain Foreign Subsidiaries, and any amendments or supplements thereto or replacements thereof approved by the Administrative Agent. 7 "Cash Pooling Bank" shall mean Bank Mendes Gans N.V., a banking entity organized under the laws of the Netherlands, or any other bank or other financial institution party to the Cash Pooling Agreement. (j) Amendment to Section 12.07 (Calculations; Computations). Clause (a) of Section 12.07 is amended by replacing in its entirety the proviso thereto with the following: "provided that (i) except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time and (ii) notwithstanding the foregoing, prior to the effective date of each of SFAS 141 and SFAS 142 (as provided therein) the Company need not give effect to purchase accounting adjustments required or permitted by APB 16 (including non-cash write-ups and non-cash charges relating to inventory and fixed assets, in each case arising in connection with the Company) and APB 17 (including non-cash charges relating to intangibles and goodwill arising in connection with the Company) or give effect to any charges in connections with accounting for the Recapitalization; provided, further, that, if the Company notifies the Administrative Agent that the Company requests an amendment to any provision hereof to eliminate the effect of any change occurring after the date hereof in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Company that the Required Banks request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith.". SECTION 2. Consent. The Required Banks hereby (i) approve and consent to the Tax Restructuring (including the Releases) for all purposes under the Credit Documents and (ii) direct the Collateral Agent to execute and deliver such documents and take all actions necessary to effect the release of, and such actions as may be reasonably requested by the Company to evidence such release of, the Liens created under the Credit Documents over the equity interests of the Foreign Subsidiaries listed on Schedule 1 hereto and the guaranties under the Credit Documents delivered by the Foreign Subsidiaries listed on Schedule 2 hereto. SECTION 3. Representations and Warranties. Each of the Borrowers hereby represents and warrants to each Bank, on and as of the date hereof, that: 8 (a) This Amendment has been duly authorized, executed and delivered by each Borrower, and each of this Amendment and the Credit Agreement (as hereby amended) constitutes a legal, valid and binding obligation of each Borrower party thereto, enforceable in accordance with its terms, except to the extent that the enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws generally affecting creditors' rights and by equitable principles (regardless of whether enforcement is sought in equity or at law). (b) After giving effect to this Amendment, the representations and warranties of the Borrowers set forth in the Credit Documents are true and correct in all material respects on and as of the date hereof, in each case with the same effect as though made on and as of the date hereof, except to the extent such representations and warranties expressly relate to an earlier date. (c) On the date hereof and immediately after giving effect to this Amendment, no Default has occurred and is continuing. SECTION 4. Conditions to Effectiveness. This Amendment shall become effective on the date (the "Amendment Effective Date") when: (a) the Administrative Agent shall have received counterparts of this Amendment that, when taken together, bear the signatures of each of the Borrowers and the Required Banks; (b) the Company shall have paid, to the extent invoiced on or prior to October 15, 2001, all out-of-pocket expenses (including fees and charges of counsel for the Administrative Agent) of the Administrative Agent required to be paid or reimbursed by the Company under the Credit Agreement; and (c) the Administrative Agent shall have received payment of all fees payable by the Company in connection with this Amendment, including the fees described in Section 5 below. SECTION 5. Amendment Fees. The Company agrees to pay to the Administrative Agent, for the account of each Bank that delivers an executed counterpart to this Amendment prior to 5:00 p.m., New York City time, on October 15, 2001 (or, if later, on the Amendment Effective Date), an amendment fee equal to 0.05% of the sum of (a) the aggregate unpaid principal amount of Term Loans held by such Bank as of 5:00 p.m., New York City time, on the Amendment Effective Date, and (b) such Bank's Revolving Credit Commitment in effect as of 5:00 p.m., New York City time, on the Amendment Effective Date; provided that the foregoing 9 fee shall not be payable unless this Amendment becomes effective as provided in Section 4 above. SECTION 6. Miscellaneous. (a) This Amendment together with the Credit Documents constitutes the entire agreement and understanding of the parties with respect to the subject matter hereof and supersedes any and all prior agreements and understandings, oral or written, relating to the subject matter hereof. (b) Section headings used herein are for convenience of reference only and are not to affect the construction of, or to be taken into consideration in interpreting, this Amendment. (C) THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. (d) Each reference to a party hereto shall be deemed to include its successors and assigns, all of whom shall be bound by this Amendment and to whose benefit the provisions of this Amendment shall inure. (e) This Amendment may be executed in any number of counterparts, each of which shall be an original but all of which, when taken together, shall constitute but one instrument. Delivery of an executed counterpart of a signature page of this Amendment by facsimile transmission shall be effective as delivery of a manually executed counterpart of this Amendment. (f) Except as specifically amended or modified hereby, the Credit Agreement shall continue in full force and effect in accordance with the provisions thereof. After the date hereof, any reference to the Credit Agreement shall mean the Credit Agreement as amended hereby. This Amendment shall be a Credit Document for all purposes. 10 IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective authorized officers as of the date first above written. FISHER SCIENTIFIC INTERNATIONAL INC., By: /s/ Todd DuChene -------------------------------------------------- Name: Todd DuChene Title: Vice President & General Counsel FISHER SCIENTIFIC U.K., LIMITED, By: /s/ Todd DuChene -------------------------------------------------- Name: Todd DuChene Title: Vice President & General Counsel FISHER SCIENTIFIC LIMITED, By: /s/ Todd DuChene -------------------------------------------------- Name: Todd DuChene Title: Vice President & General Counsel ACROS ORGANICS N.V., By: /s/ Todd DuChene -------------------------------------------------- Name: Todd DuChene Title: Vice President & General Counsel FISHER SCIENTIFIC S.A.S., By: /s/ Todd DuChene -------------------------------------------------- Name: Todd DuChene Title: Vice President & General Counsel FISHER SCIENTIFIC GmbH, By: /s/ Todd DuChene -------------------------------------------------- Name: Todd DuChene Title: Vice President & General Counsel FISHER SCIENTIFIC KOREA LED., By: /s/ Todd DuChene -------------------------------------------------- Name: Todd DuChene Title: Vice President & General Counsel FISHER SCIENTIFIC B.V., By: /s/ Todd DuChene -------------------------------------------------- Name: Todd DuChene Title: Vice President & General Counsel CASA ROCAS S.A. DE C.V., By: /s/ Todd DuChene -------------------------------------------------- Name: Todd DuChene Title: Vice President & General Counsel FISHER GENETICS ASIA pte LTD., By: /s/ Todd DuChene -------------------------------------------------- Name: Todd DuChene Title: Vice President & General Counsel FISHER SCIENTIFIC pte LTD., By: /s/ Todd DuChene -------------------------------------------------- Name: Todd DuChene Title: Vice President & General Counsel FISHER SCIENTIFIC AG, By: /s/ Todd DuChene -------------------------------------------------- Name: Todd DuChene Title: Vice President & General Counsel THE CHASE MANHATTAN BANK, as Administrative Agent and as a Bank, By: /s/ Stacey Haimes -------------------------------------------------- Name: Stacey Haimes Title: Vice President MERRILL LYNCH CAPITAL CORPORATION, as Syndication Agent and as a Bank, By: /s/ Howard D. Sysler -------------------------------------------------- Name: Howard D. Sysler Title: Vice President DLJ CAPITAL FUNDING, INC., as Documentation Agent and as a Bank, By: /s/ Dana F. Klein -------------------------------------------------- Name: Dana F. Klein Title: Director KZH CNC LLC, By: /s/ Susan Lee -------------------------------------------------- Name: Susan Lee Title: Authorized Agent KZH CRESCENT LLC, By: /s/ Susan Lee -------------------------------------------------- Name: Susan Lee Title: Authorized Agent KZH CRESCENT-2 LLC, By: /s/ Susan Lee -------------------------------------------------- Name: Susan Lee Title: Authorized Agent KZH CYPRESSTREE-1 LLC, By: /s/ Susan Lee -------------------------------------------------- Name: Susan Lee Title: Authorized Agent KZH ING-2 LLC, By: /s/ Susan Lee -------------------------------------------------- Name: Susan Lee Title: Authorized Agent KZH LANGDALE LLC, By: /s/ Susan Lee -------------------------------------------------- Name: Susan Lee Title: Authorized Agent SENIOR DEBT PORTFOLIO, BY: BOSTON MANAGEMENT AND RESEARCH as Investment Advisor, By: /s/ Scott H. Page ------------------------------------------- Name: Scott H. Page Title: Vice President FLEET NATIONAL BANK, By: /s/ Christopher J. Wickles -------------------------------------------------- Name: Christopher J. Wickles Title: Vice President BNP PARIBAS, By: /s/ Stephanie Rogers -------------------------------------------------- Name: Stephanie Rogers Time: Vice President By: /s/ Shayn P. March -------------------------------------------------- Name: Shayn P. March Title: Vice President EATON VANCE SENIOR INCOME TRUST BY: EATON VANCE MANAGEMENT as Investment Advisor, By: /s/ Scott H. Page ------------------------------------------- Name: Scott H. Page Title: Vice President EATON VANCE INSTITUTIONAL SENIOR LOAN FUND, BY: EATON VANCE MANAGEMENT as Investment Advisor, By: /s/ Scott H. Page ------------------------------------------- Name: Scott H. Page Title: Vice President EATON VANCE CDO III, LTD., BY: EATON VANCE MANAGEMENT as Investment Advisor, By: /s/ Scott H. Page ------------------------------------------- Name: Scott H. Page Title: Vice President EATON VANCE CDO IV, LTD., BY: EATON VANCE MANAGEMENT as Investment Advisor, By: /s/ Scott H. Page ------------------------------------------- Name: Scott H. Page Title: Vice President GRAYSON & CO., BY: BOSTON MANAGEMENT AND RESEARCH, as Investment Advisor, By: /s/ Scott H. Page ------------------------------------------- Name: Scott H. Page Title: Vice President BANK OF TOKYO-MITSUBISHI TRUST COMPANY, By: /s/ Chris Droussiotis -------------------------------------------------- Name: Chris Droussiotis Time: Vice President NATEXIS BANQUES POPULAIRES, By: /s/ Frank H. Madden, Jr. -------------------------------------------------- Name: Frank H. Madden, Jr. Title: Vice President & Group Manager By: /s/ Harris Frommer -------------------------------------------------- Name: Harris Frommer Title: Assistant Vice President VAN KAMPEN PRIME RATE INCOME TRUST, BY: VAN KAMPEN INVESTMENT ADVISORY CORP., By: /s/ Darvin D. Pierce ------------------------------------------- Name: Darvin D. Pierce Title: Executive Director VAN KAMPEN CLO I, LIMITED, BY: VAN KAMPEN MANAGEMENT INC., as Collateral Manager, By: /s/ Darvin D. Pierce ------------------------------------------- Name: Darvin D. Pierce Title: Executive Director BANK OF AMERICA, N.A., By: /s/ David H. Strickert -------------------------------------------------- Name: David H. Strickert Title: Managing Director NATIONAL CITY BANK, By: /s/ Stephen Bassett -------------------------------------------------- Name: Stephen Bassett Title: Account Officer CIBC, INC., BY: CIBC WORLD MARKETS CORP., as Agent, By: /s/ Dominic Sorresso ------------------------------------------- Name: Dominic Sorresso Title: Executive Director ABN AMRO BANK N.V., By: /s/ James E. Davis -------------------------------------------------- Name: James E. Davis Title: Senior Vice President By: /s/ David A. Carroll -------------------------------------------------- Name: David A. Carroll Title: Assistant Vice President MITSUBISHI TRUST & BANKING, By: /s/ Toshihiro Hayashi -------------------------------------------------- Name: Toshihiro Hayashi Title: Senior Vice President NEW YORK LIFE INSURANCE COMPANY, By: /s/ F. David Melka -------------------------------------------------- Name: F. David Melka Title: Investment Vice President NEW YORK LIFE INSURANCE and ANNUITY CORPORATION, BY: NEW YORK LIFE INVESTMENT MANAGEMENT LLC, as Investment Manager, By: /s/ F. David Melka ------------------------------------------- Name: F. David Melka Title: Vice President JACKSON NATIONAL LIFE INSURANCE COMPANY, BY: PPM AMERICA, INC, as its attorney-in-fact, By: /s/ David C. Wagner ------------------------------------------- Name: David C. Wagner Title: Managing Director ERSTE BANK, By: /s/ Brandon A. Meyerson -------------------------------------------------- Name: Brandon A. Meyerson Title: Vice President Erste Bank, New York Branch By: /s/ John S. Runnion -------------------------------------------------- Name: John S. Runnion Title: Managing Director Erste Bank, New York Branch FIRSTRUST BANK, By: /s/ Kent D. Nelson -------------------------------------------------- Name: Kent D. Nelson Title: Vice President HSBC BANK USA, By: /s/ Thomas J. Crowley -------------------------------------------------- Name: Thomas J. Crowley Title: Vice President CREDIT INDUSTRIEL ET COMMERICAL, By: /s/ Anthony Rock -------------------------------------------------- Name: Anthony Rock Title: Vice President By: /s/ Marcus Edward -------------------------------------------------- Name: Marcus Edward Title: Vice President SEQUILS I, LTD, BY: TCW ADVISORS, INC., as Collateral Manager, By: /s/ Mark L. Gold ------------------------------------------- Name: Mark L. Gold Title: Managing Director By: /s/ G. Steven Kahn ------------------------------------------- Name: G. Steven Kahn Title: Vice President THE BANK OF NOVA SCOTIA, By: /s/ T. M. Pitcher -------------------------------------------------- Name: T. M. Pitcher Title: Authorized Signatory MELLON BANK, N.A., By: /s/ Alexandra M. Dulchinos -------------------------------------------------- Name: Alexandra M. Dulchinos Title: Vice President INDOSUEZ CAPITAL FUNDING IV, L.P., BY: INDOSUEZ CAPITAL, as Portfolio Advisor, By: /s/ Jack C. Henry ------------------------------------------- Name: Jack C. Henry Title: VP-Portfolio Manager BALANCED HIGH YIELD FUND I, LTD., By: ING CAPITAL ADVISORS LLC, as Asset Manager, By: /s/ Michael J. Campbell ------------------------------------------- Name: Michael J. Campbell Title: Managing Director BALANCED HIGH YIELD FUND II, LTD., By: ING CAPITAL ADVISORS LLC as Asset Manager, By: /s/ Michael J. Campbell ------------------------------------------- Name: Michael J. Campbell Title: Managing Director PB CAPITAL, By: /s/ Thomas Dearth -------------------------------------------------- Name: Thomas Dearth Title: Managing Director By: /s/ J. N. Frost -------------------------------------------------- Name: J. N. Frost Title: Managing Director THE INDUSTRIAL BANK OF JAPAN, LIMITED, By: /a/ Mabuchi Akihiko -------------------------------------------------- Name: Mabuchi Akihiko Title: Senior Vice President WINGED FOOT FUNDING TRUST, By: /s/ Ann E. Morris -------------------------------------------------- Name: Ann E. Morris Title: Assistant Vice President SUMITOMO MITSUI BANKING CORPORATION, By: /s/ Suresh Tata -------------------------------------------------- Name: Suresh Tata Title: Senior Vice President ALLIANCE INVESTMENTS LIMITED, By: /s/ Joel G. Serebransky -------------------------------------------------- Name: Joel G. Serebransky Tithe: Senior Vice President FRANKLIN CLO I, LIMITED, By: /s/ Chauncey Lufkin -------------------------------------------------- Name: Chauncey Lufkin Title: Vice President FRANKLIN CLO II, LIMITED, By: /s/ Chauncey Lufkin -------------------------------------------------- Name: Chauncey Lufkin Title: Vice President GALAXY CLO 1999-1, LTD., By: /s/ Thomas G. Brandt -------------------------------------------------- Name: Thomas G. Brandt Title: Authorized Agent CREDIT SUISSE FIRST BOSTON, By: /s/ Dana F. Klein -------------------------------------------------- Name: Dana F. Klein Tithe: Director BANKERS TRUST COMPANY, By: /s/ Scottye D. Lindsey -------------------------------------------------- Name: Scottye D. Lindsey Title: Vice President ARCHIMEDES FUNDING II, LTD., BY: ING Capital Advisors LLC as Collateral Manager, By: /s/ Michael J. Campbell ------------------------------------------- Name: Michael J. Campbell Title: Managing Director CONTINENTAL ASSURANCE COMPANY, Separate Account (E), BY: TCW ASSET MANAGEMENT COMPANY, as Attorney-in-Fact, By: /s/ Mark Gold ------------------------------------------- Name: Mark Gold Title: Managing Director By: /s/ G. Steven Kahn ------------------------------------------- Name: G. Steven Kahn Tithe: Vice President OXFORD STRATEGIC INCOME FUND, BY: EATON VANCE MANAGEMENT, as Investment Advisor, By: /s/ Scott H. Page ------------------------------------------- Name: Scott H. Page Title: Vice President Schedule 1 Released Pledges Fisher Scientific Limited Fisher Scientific of the Netherlands B.V. Acros Organics B.V.B.A. Fisher Bioblock Scientific S.A.S. Fisher Scientific Holding U.K. Limited Fisher Scientific Europe Holdings B.V. Fisher Scientific The Hague I B.V. Fisher Scientific The Hague II B.V. Fisher Scientific UK Holding Company Limited FSL Holding L.L.C. Fisher Scientific Belgium Holding B.V.B.A. Fisher Scientific AG Fisher Scientific U.K. Limited Fisher Chimica N.V. Schedule 2 Released Guarantees Fisher Scientific Europe Holdings B.V. Fisher Scientific The Hague I B.V. Fisher Scientific The Hague II B.V. Fisher Scientific UK Holdings Company Limited Fisher Scientific Belgium Holding B.V.B.A. Fisher Clinical Services U.K. Limited Fisher Clinical Services Holding GmbH Fisher Chimica N.V. Fisher Scientific AG Acros Organics B.V.B.A. EX-23.1 4 l92310ex23-1.txt CONSENT OF DELOITTE & TOUCHE LLP. EXHIBIT 23.1 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in this Registration Statement of Fisher Scientific International Inc. on Form S-3 of our reports dated February 2, 2001 (February 14, 2001 as to Note 22), appearing in the Annual Report on Form 10-K of Fisher Scientific International Inc. for the year ended December 31, 2000, and to the reference to us under the heading "Experts" in the Prospectus, which is part of this Registration Statement. Deloitte & Touche LLP New York, New York January 18, 2002 EX-23.2 5 l92310ex23-2.txt CONSENT OF DELOITTE & TOUCHE LLP. EXHIBIT 23.2 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in this Registration Statement of Fisher Scientific International Inc. on Form S-3 of our report dated October 15, 2001 (November 5, 2001 as to Note 2), appearing in the Current Report on Form 8-K of Fisher Scientific International Inc. filed on January 11, 2002, and to the reference to us under the heading "Experts" in the Prospectus, which is part of this Registration Statement. Deloitte & Touche LLP Pittsburgh, Pennsylvania January 18, 2002 EX-23.3 6 l92310ex23-3.txt CONSENT OF WARADY & DAVIS EXHIBIT 23.3 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in this Registration Statement of Fisher Scientific International Inc. on Form S-3 of our report dated October 3, 2001, appearing in the Current Report on Form 8-K of Fisher Scientific International Inc. filed on January 11, 2002, and to the reference to us under the heading "Experts" in the Prospectus, which is part of this Registration Statement. Warady & Davis LLP Deerfield, Illinois January 18, 2002 -----END PRIVACY-ENHANCED MESSAGE-----