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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________
FORM 10-K
Annual Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
_____________________
For the fiscal year ended Commission file number
December 27, 1997 1-4105
BAUSCH & LOMB INCORPORATED
(Exact name of registrant as specified in its charter)
NEW YORK 16-0345235
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
ONE BAUSCH & LOMB PLACE, ROCHESTER, NEW YORK 14604-2701
(Address of principal executive offices) (Zip Code)
Registrant's telephone no., including area code: (716) 338-6000
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on
which registered
Common Stock, $0.40 par value New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant: (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period
[Cover page 1 of 2 pages]
that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90
days. Yes [ X ] No___
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ X ]
The aggregate market value (based on the consolidated tape
closing price on February 24, 1998) of the voting stock held by
non-affiliates of the registrant was $2,476,057,910. For the
sole purpose of making this calculation, the term "non-affiliate"
has been interpreted to exclude directors and officers. Such
interpretation is not intended to be, and should not be construed
to be, an admission by Bausch & Lomb Incorporated or such
directors or officers that such directors and officers are
"affiliates" of Bausch & Lomb Incorporated, as that term is
defined under the Securities Act of 1933.
The number of shares of Voting Stock of the registrant,
outstanding as of February 24, 1998 was 55,569,003, consisting of
54,892,225 shares of Common Stock and 676,778 shares of Class B
stock, which are identical with respect to dividend and
liquidation rights, and vote together as a single class for all
purposes.
DOCUMENTS INCORPORATED BY REFERENCE
Parts I and II The Bausch & Lomb 1997 Annual Report to
Shareholders for fiscal year ended December 27,
1997 ("Annual Report"). With the exception of
the pages of the Annual Report specifically
Incorporated by reference herein, the Annual
Report is not deemed to be filed as a part of
this Report on Form 10-K.
Part III Bausch & Lomb Incorporated Proxy Statement,
dated March 18, 1998 ("Proxy Statement"). With
the exception of the pages of the Proxy
Statement specifically Incorporated by
reference herein, the Proxy Statement is not
deemed to be filed as part of this Report on
Form 10-K.
[Cover page 2 of 2 pages]
1
TABLE OF CONTENTS
PART I PAGE
Item 1. Business 2
Item 2. Properties 5
Item 3. Legal Proceedings 7
Item 4. Submission of Matters to a Vote of
Shareholders 7
PART II
Item 5. Market for Bausch & Lomb Incorporated's
Common Stock and Related Shareholder
Matters 8
Item 6. Selected Financial Data 8
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 8
Item 7A. Quantitative and Qualitative Disclosures
About Market Risk 8
Item 8. Financial Statements and Supplementary
Data 8
Item 9. Changes In and Disagreements With
Accountants on Accounting and Financial
Disclosure 8
PART III
Item 10. Directors and Executive Officers of
Bausch & Lomb Incorporated 9
Item 11. Executive Compensation 10
Item 12. Security Ownership of Certain Beneficial
Owners and Management 10
Item 13. Certain Relationships and Related
Transactions 10
PART IV
Item 14. Exhibits, Financial Statement Schedule,
and Reports on Form 8-K 11
Signatures 12
Schedules S-1
Exhibit Index E-1
Exhibits (Attached to this Report on Form 10-K)
2
PART I
ITEM 1. BUSINESS
(a) GENERAL DEVELOPMENT OF BUSINESS
Bausch & Lomb Incorporated is a world leader in the development,
manufacture and marketing of products that go in or on the eye.
Bausch & Lomb was incorporated in the State of New York in 1908
to carry on a business which was established in 1853. Its
principal executive offices are located in Rochester, New York.
Unless the context indicates otherwise, the terms "Bausch & Lomb"
and "company" as used herein refer to Bausch & Lomb Incorporated
and its consolidated subsidiaries. Highlights of the general
development of the business of Bausch & Lomb during 1997 are
discussed below.
The year ending December 27, 1997 set the stage for growth as
significant progress was made in transforming the company from a
diversified healthcare and optics company to one focused on
global eye care. Reported revenues for 1997 were $1,916 million,
a decrease of $11 million or less than 1% from 1996. Net earnings
for 1997 amounted to $49 million, or $0.89 per diluted share,
compared to $83 million or $1.47 per diluted share, reported in
1996. Significant operational matters affecting both periods
included restructuring charges, disposition of non-core
businesses and litigation charges.
In early 1997, the company's board of directors approved plans to
further restructure all business segments as well as certain
corporate administrative functions. This restructuring effort is
expected to significantly reduce the company's fixed cost
structure and realign the organization to meet its strategic
objectives. These actions resulted in the recording of pre-tax
restructuring charges of $72 million in 1997. The program is
expected to generate annual pre-tax savings of approximately $100
million by 1999. Savings will be generated from projects related
to the company's manufacturing processes, including plans to
phase out sunglass component manufacturing at the company's Frame
Center in Rochester, New York. Savings will also come from
restructuring administrative functions. The projects are
expected to result in improved operating margins, particularly in
the eyewear business, and greater flexibility to invest in growth
opportunities.
In April 1997, the company acquired the assets and trademarks of
the Killer Loop eyewear brands from Benetton Sportsystem of Italy
in a transaction valued at approximately $43 million. Prior to
the acquisition, the company had an exclusive agreement to market
Killer Loop eyewear products.
The company announced in November 1997 that it had entered into
an administrative Consent Order with the Securities and Exchange
Commission (SEC), bringing to a close the SEC's three-year
investigation into certain contact lens and sunglass transactions
that were improperly recorded as sales for the 1993 fiscal year.
The company did not admit or deny liability and no fines or
penalties were imposed.
In a related matter, the company, without admitting any
liability, agreed to pay $42 million in cash to settle a three-
year-old consolidated shareholder class action suit where it was
claimed that the company knowingly misrepresented its 1993
earnings. The company's insurance carrier will pay a substantial
portion of the cost of the settlement. The company recorded a
pre-tax charge of $21 million in the fourth quarter to cover the
cost of the proposed settlement.
In December 1997, the company sold its Thin Film Technology
Division to Applied Image Inc. for $9 million. There was no
material gain or loss on the transaction. The division
manufactured and applied optical thin film coatings for various
eyewear, lighting, optical, commercial and industrial
applications.
In late 1997, the company secured a $900 million 364-day
revolving credit facility and a $300 million five-year revolving
credit facility. These new facilities are being used to support
borrowings to fund
3
the acquisitions of Storz and Chiron Vision,
which were consummated subsequent to fiscal year end and are
described below, as well as to provide funds for operations of
the existing businesses. The interest rate applicable to
borrowing under the agreements is based on the LIBOR rate, or, at
the company's option, the higher of several other common indices.
No debt was outstanding under these agreements at December 27,
1997.
On December 29, 1997, the company completed the acquisition of
Chiron Vision Corporation (Chiron Vision), the ophthalmic
products unit of Chiron Corporation, for $300 million in cash.
Chiron Vision researches, develops and manufactures innovative
products that improve results in cataract and refractive surgery,
and the treatment of progressive eye diseases.
On December 31, 1997, the company also completed the acquisition
of Storz Instrument Company (Storz), a subsidiary of American
Home Products Corporation, for $380 million in cash. Storz is a
leading international manufacturer and distributor of high
quality ophthalmic surgical instruments, surgical and diagnostic
equipment, intraocular lens implants and ophthalmic
pharmaceuticals.
(b) FINANCIAL INFORMATION ABOUT INDUSTRY SEGMENTS
Information concerning sales, business segment earnings and
identifiable assets attributable to each of Bausch & Lomb's
reportable industry segments is set forth on pages 26-30 and 46-
47 of the Annual Report and are incorporated herein by reference.
(c) NARRATIVE DESCRIPTION OF BUSINESS
Industry Segments. Bausch & Lomb's operations are classified
into four industry segments: vision care, eyewear,
pharmaceuticals and healthcare. Below is a description of each
segment and information to the extent that it is material to an
understanding of the company's business taken as a whole.
Additional information can be found on pages 8-21 of the Annual
Report and are incorporated herein by reference.
Vision Care - The vision care segment includes contact lenses and
lens care products. Vision care products are marketed to licensed
eye care professionals, pharmaceutical retailers and mass
merchandisers by the company's own sales force and distributors.
Eyewear - The eyewear segment includes premium-priced sunglasses
and vision accessories. Eyewear products are distributed
worldwide through the company's direct sales force, as well as
through distributors, wholesalers and manufacturer's
representatives. These products are marketed through optical
stores, sunglass specialty stores, department stores, catalog
showrooms, mass merchandisers and sporting goods stores.
Pharmaceuticals - The pharmaceuticals segment manufactures and
sells generic and proprietary prescription pharmaceuticals with a
strategic emphasis in the ophthalmic field and over-the-counter
(OTC) medications. These products are marketed by the company's
sales force and distributed through wholesalers, independent
pharmacies, drug stores, food stores, mass merchandisers and
hospitals.
Healthcare - Included in this segment are businesses which
provide purpose-bred laboratory animals, pathogen-free eggs,
biomedical products and services, hearing aids and skin care
products. Biomedical products are sold through the company's own
sales force to the scientific research community. Hearing aids
are distributed primarily through the Miracle-Ear franchise
system and company-owned stores. Skin care products are sold
through the company's sales force and brokers to drug stores,
food stores, mass merchandisers, warehouse clubs and the military
class of trade.
Suppliers and Customers. Materials and components in all four of
the company's industry segments are purchased from a wide variety
of suppliers and the loss of any one supplier would not adversely
affect the company's business to a significant extent. No
material part of the company's business taken as a whole
4
is dependent upon a single or a few customers. However, in the
eyewear segment approximately 13% of segment sales are
attributable to Sunglass Hut International and in the vision care
segment approximately 10% of segment sales are attributable to
Wal-Mart.
Patents, Trademarks and Licenses. While in the aggregate the
company's patents are of material importance to its businesses
taken as a whole, no single patent or patent license or group of
patent licenses relating to any particular product or process is
material to any industry segment. The company actively pursues
technology development and acquisition as a means to enhance its
competitive position in its business segments.
In the vision care segment, Bausch & Lomb has developed
significant consumer and eye care professional recognition of
products sold under the Bausch & Lomb, ReNu, ReNu MultiPlus,
Sensitive Eyes, SeeQuence, Medalist, Boston, Optima FW and
SofLens66 trademarks. Ray-Ban, Revo, Wayfarer, Arnette and
Killer Loop are trademarks receiving substantial consumer
recognition in the eyewear segment. Bausch & Lomb and Dr. Mann
Pharma are trademarks receiving substantial consumer recognition
in the pharmaceuticals segment. In the healthcare segment,
Miracle-Ear, Mirage, Curel, Soft Sense and Charles River are
trademarks receiving significant consumer and industry
professional recognition.
Seasonality and Working Capital. Some seasonality exists for
sunglasses in the eyewear segment. The accumulation of
inventories of such products in advance of expected shipments
reflects the seasonal nature of the products. In general, the
working capital practices followed in each of the company's
industry segments are typical of those businesses.
Competition. Each industry is highly competitive in both U.S.
and non-U.S. markets. In all of its segments, Bausch & Lomb
competes on the basis of product performance, quality,
technology, price, service, warranty and reliability. In the
eyewear segment, the company also competes on the basis of style.
Research and Development. Research and development constitutes
an important part of Bausch & Lomb's activities. In 1997, the
company's research and development expenditures totaled $67
million, as compared to $75 million in 1996 and $66 million in
1995.
Environment. Although Bausch & Lomb is unable to predict what
legislation or regulations may be adopted or enacted in the
future with respect to environmental protection and waste
disposal, existing legislation and regulations have had no
material adverse effect on its capital expenditures, earnings or
competitive position. Capital expenditures for property, plant
and equipment for environmental control facilities were not
material during 1997 and are not anticipated to be material for
1998 or 1999.
Year 2000 Software Compliance. Information regarding the
identification and resolution of year 2000 data and processing
issues is set forth on page 36 of the Annual Report and such
information is incorporated herein by reference.
Number of Employees. Bausch & Lomb employed approximately 13,000
persons as of December 27, 1997.
(d) FINANCIAL INFORMATION ABOUT FOREIGN AND DOMESTIC OPERATIONS
AND EXPORT SALES
Information as to sales, operating earnings and identifiable
assets attributable to each of Bausch & Lomb's geographic
regions, and the amount of export sales in the aggregate, is set
forth on pages 31-32 and 46 of the Annual Report and is
incorporated herein by reference.
5
ITEM 2. PROPERTIES
The principal manufacturing, distribution and production
facilities and other important physical properties of Bausch &
Lomb at March 1, 1998 are listed below and are grouped under the
principal industry segment to which they relate. Certain
properties relate to more than one industry segment. Except
where otherwise indicated by footnote, all properties shown are
held in fee and are not subject to major encumbrances.
Eyewear
Manufacturing Plants Distribution Centers
Beijing, China (2) San Clemente, CA (2)
Bhiwadi, India Sunnyvale, CA (2)
Waterford, Ireland (2) San Antonio, TX
Rochester, NY (Frame Center) Richmond Hill, Ontario,
San Antonio, TX Canada (2)
New Territories, Hong Kong (2) Hoofdorp, Netherlands (2)
Nuevo Laredo, Mexico (2) North Ryde, Australia (2)
Guangzhou, China (2)
Healthcare
Production Facilities
Hollister, CA (2) Houston, TX
Lebanon, CT Brussels, Belgium
Preston, CT St. Constant, Canada
Storrs, CT Margate, England
Voluntown, CT West Sussex, England
Summerland Key, FL Lyon, France (2)
Colbert, GA (2) St. Aubin-les-Elbeuf, France
Eureka, IL St. Germain, France (2)
Roanoke, IL Extertal, Germany
Windham, ME Kisslegg, Germany
Southbridge, MA (2) Sulzfeld, Germany
West Brookfield, MA (2) Calco, Italy
Wilmington, MA Atsugi, Japan
Portage, MI Hino, Japan
O'Fallon, MO Tskuba, Japan (2)
Raleigh, NC Tuhuacan, Mexico (2)
Pittsfield, NH Someren, Netherlands
Newfield (Lakeview), NJ Barcelona, Spain (2)
Stone Ridge (Kingston), NY Uppsala, Sweden (2)
Charleston, SC (2) Budapest, Hungary (2)
Prague, Czech Republic (2)
Manufacturing Plants Distribution Centers
Golden Valley, MN (1) Wilmington, MA (2)
Kitchener, Ontario, Canada (2) Golden Valley, MN (1)
Preston, CT (2)
6
Pharmaceuticals/Surgical
Manufacturing Plants Distribution Centers
Tampa, FL Tampa, FL
Berlin, Germany Bracknell, United Kingdom (2)
Claremont, CA (2) Heidelberg, Germany (2)
Irvine, CA
Clearwater, FL
St. Louis, MO
Artarmon, Australia (2)
Lyon, France (2)
Vision Care
Manufacturing Plants Distribution Centers
Sarasota, FL (1) Rochester, NY (Optics Center)
Wilmington, MA (2) (1)(2)
Rochester, NY (Optics Center) Greenville, SC (2)
(1)(2) Lynchburg, VA (2)
Greenville, SC Richmond Hill, Ontario,
Porto Alegre, Brazil Canada (2)
Beijing, China (2) Guangzhou, China (2)
Bhiwadi, India Hoofdorp, Netherlands (2)
Waterford, Ireland (2) Livingston, Scotland (2)
Milan, Italy
Umsong-Gun (Seoul), Korea
Livingston, Scotland (2)
Barcelona, Spain
Hastings, United Kingdom
Madrid, Spain (2)
North Ryde, Australia (2)
Corporate Facilities
Rochester, NY
One Bausch & Lomb Place (2)
Optics Center (1) (2)
1295 Scottsville Road (2)
(1) This facility is financed under a tax-exempt financing
agreement
(2) This facility is leased
Bausch & Lomb considers that its facilities are suitable and
adequate for the operations involved. All facilities are being
productively utilized.
7
ITEM 3. LEGAL PROCEEDINGS
1. Since June of 1994, the company has defended several
shareholder actions against the company, its former Chief
Executive Officer and Chairman, Daniel E. Gill, and four other
officers, alleging that the defendants made false and misleading
statements about expected financial results. These actions have
been consolidated in the United States District Court for the
Western District of New York. On November 17, 1997, the company
announced that it had entered into a memorandum of understanding
with counsel representing the plaintiffs, agreeing to pay $42
million in full settlement of all claims. In entering into this
proposed settlement, the company and the individual defendants
have continued to deny all liability, but have settled in order
to avoid the expense and burden of further litigation. The
claimants include purchasers of the company's common stock from
December 13, 1993 through January 25, 1995. The proposed
settlement is subject to making appropriate notice to potential
class members and a review by the Court of the fairness and
adequacy of the terms of the settlement. The company's insurance
carriers have agreed to contribute substantially toward this
settlement and the company has recorded a one-time charge against
1997 fourth-quarter earnings of $21 million or $13 million after
taxes.
2. Since December 1994, the company has been the subject of an
investigation by the Securities and Exchange Commission (SEC)
principally focused on the accounting treatment of (i) a 1993
contact lens sales program and (ii) Asian sunglass sales from
late 1992 through early 1994. This investigation was concluded
when the company, without admitting or denying liability, entered
into a Consent Order with the SEC, which was announced on
November 17, 1997. The Order imposed no financial penalties on
the company.
3. The company has stipulated to certification by a New York
State Supreme Court of a nationwide class of purchasers of
Sensitive Eyes Rewetting Drops, Boston Rewetting Drops, ReNu
Rewetting Drops and Bausch & Lomb Eye Wash between May 1, 1989
and June 30, 1995. This action arose out of matters commenced in
1994 and 1995 alleging that the company misled consumers in its
marketing and sale of those products. Management vigorously
defends the company's practices.
4. In several actions, the company is defending its long-
standing policy of selling contact lenses only to licensed
professionals against claims that it was adopted in conspiracy
with others to eliminate alternate channels of trade from the
disposable contact lens market. These matters include (i) a
consolidated action in the United States District Court for the
Middle District of Florida filed in June 1994 by the Florida
Attorney General, and now includes claims by the attorneys
general of 21 other states, and (ii) individual actions pending
in California and Tennessee state courts. The company defends
its policy as a lawfully adopted means of ensuring effective
distribution of its products and safeguarding consumers' health.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SHAREHOLDERS
Inapplicable.
8
PART II
ITEM 5. MARKET FOR BAUSCH & LOMB INCORPORATED'S COMMON
STOCK AND RELATED SHAREHOLDER MATTERS
The sections entitled "Dividends" and "Quarterly Stock Prices"
and table entitled "Selected Financial Data" on pages 34, 37 and
63, respectively, of the Annual Report are incorporated herein by
reference.
ITEM 6. SELECTED FINANCIAL DATA
The table entitled "Selected Financial Data" on page 63 of the
Annual Report is incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The section entitled "Financial Review" on pages 26-36 of the
Annual Report is incorporated herein by reference.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
The section entitled "Derivative Financial Instruments" on pages
42 and 58-59 of the Annual Report is incorporated herein by
reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The financial statements, including the notes thereto, together
with the sections entitled "Report of Independent Accountants"
and "Quarterly Results" on pages 38-61, 62 and 37 of the Annual
Report, respectively, are incorporated herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
Inapplicable.
9
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF
BAUSCH & LOMB INCORPORATED
Information with respect to non-officer directors is included in
the Proxy Statement on pages 3-7 and such information is
incorporated herein by reference. Set forth below are the names,
ages (as of March 1, 1998), positions and offices held by, and a
brief account of the business experience during the past five
years of, each executive officer.
Name and Age Position
William H. Waltrip (60) Chairman since January 1997; Chairman
and Chief Executive Officer (1996);
Chairman of Technology Solutions
Company since 1993; Chief Executive
Officer, Technology Solutions Company
(1993-1995); Chairman and Chief
Executive Officer of Biggers
Brothers, Inc. (1991-1993).
William M. Carpenter (45) Chief Executive Officer since January
1997; President and Chief Operating
Officer (1995-1996); Executive Vice
President, Global Business Manager,
Eyewear (1995-1996); President and
Chief Executive Officer, Reckitt &
Colman, Inc. (1994-1995); President
and Chief Operating Officer, Reckitt
and Colman, Inc. (1992-1994).
Dwain L. Hahs (45) Executive Vice President and
President - Eyewear since April 1997;
Senior Vice President, International
Operations (1996-1997); Vice
President and President Europe,
Middle East and Africa Division
(1994-1996); Vice President Field
Operations Europe, Middle East and
Africa Division (1992-1994).
Carl E. Sassano (48) Executive Vice President and
President - Vision Care since January
1997; Senior Vice President and
Global Business Manager, Vision Care
(1996); Global Business Manager,
Contact Lens Products (1994-1996);
Senior Vice President and President,
Contact Lens Division (1994-1996);
Senior Vice President and President,
Polymer Technology Corporation, a
subsidiary of the company (1992-
1994).
Daryl M. Dickson (46) Senior Vice President, Human
Resources since November 1996; Vice
President Human Resources (Foods
group), Quaker Oats Company (1993-
1996); Sector Director Organization,
Staffing and Development,
AlliedSignal Aerospace, AlliedSignal
Inc. (1991-1993).
James C. Foster (47) Senior Vice President since 1994
and President and Chief Executive
Officer of Charles River
Laboratories, Inc., a subsidiary of
the company, since 1991; Vice
President (1991-1994).
Stephen C. McCluski (45) Senior Vice President and Chief
Financial Officer since 1995; Vice
President and Controller (1994);
President, Outlook Eyewear Company
(1992-1994).
Thomas M. Riedhammer (49) Senior Vice President and President,
Worldwide Pharmaceuticals since
February 1998; Senior Vice President
and President, Worldwide
Pharmaceutical, Surgical, and Hearing
Care Products (1994-1998); Vice
10
President (1993-1994); President,
Worldwide Pharmaceuticals (1994);
President, Pharmaceutical Division
(1992-1993).
Robert B. Stiles (48) Senior Vice President and General
Counsel since June 1997; Staff Vice
President and Assistant General
Counsel (1994-1997); Assistant
General Counsel (1991-1994).
Jurij Z. Kushner (47) Vice President, Controller since
1995; Vice President, Operations,
Personal Products Division (1994-
1995); Vice President and Controller,
Personal Products Division (1992-
1994).
All officers serve on a year-to-year basis through the day of the
annual meeting of shareholders of the company, and there is no
arrangement or understanding among any of the officers of the
company and any other persons pursuant to which such officer was
selected as an officer.
ITEM 11. EXECUTIVE COMPENSATION
The portions of the "Executive Compensation" section entitled
"Report of the Committee on Management", "Compensation Tables"
and "Defined Benefit Retirement Plans", the second and third
paragraphs of the section entitled "Board of Directors", the
graph entitled "Comparison of Five Year Cumulative Total
Shareholder Return" and the second paragraph of the section
entitled "Related Transactions, Employment Contracts and
Termination of Employment and Change in Control Arrangements"
included in the Proxy Statement on pages 10-13, 14-16, 17-18, 1-
2, 16, and 18, respectively, are incorporated herein by
reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The section entitled "Security Ownership of Certain Beneficial
Owners and Management" in the Proxy Statement on page 8 is
incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The first paragraph of the section entitled "Related
Transactions, Employment Contracts and Termination of Employment
and Change of Control Arrangements" on page 18 of the Proxy
Statement is incorporated herein by reference.
11
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
FORM 8-K
The following documents or the portions thereof indicated are
filed as a part of this report.
(a) INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT
SCHEDULES COVERED BY REPORTS OF INDEPENDENT ACCOUNTANTS.
1. Data incorporated by reference in Page in
Item 8 from the Annual Report Annual Report
Report of Independent Accountants 62
Balance Sheet at December 27, 1997 and
December 28, 1996 39
For the years ended December 27, 1997,
December 28, 1996 and December 30, 1995:
Statement of Earnings 38
Statement of Cash Flows 40
Notes to Financial Statements 41-61
2. Filed herewith
Report of Independent Accountants
on Financial Statement Schedules Exhibit 24
For the years ended December 27, 1997,
December 28, 1996 and December 30, 1995:
SCHEDULE II- Valuation and Qualifying
Accounts Page S-1
All other schedules have been omitted because the required
information is not present or not present in amounts sufficient
to require submission of the schedule, or because the information
required is included in the consolidated financial statements or
the notes thereto.
(b) REPORTS ON FORM 8-K
Inapplicable.
(c) ITEM 601 EXHIBITS
Those exhibits required to be filed by Item 601 of Regulation S-K
are listed in the Exhibit Index immediately preceding the
exhibits filed herewith and such listing is incorporated herein
by reference. Each of Exhibits (10)-a through (10)-w is a
management contract or compensatory plan or arrangement required
to be filed as an exhibit to this form pursuant to Item 14(c) of
this report.
12
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
BAUSCH & LOMB INCORPORATED
Date: March 23, 1998 By:/s/William M. Carpenter
William M. Carpenter
President and Chief Executive
Officer
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the
dates indicated.
Principal Executive Officer
Date: March 23, 1998 By:/s/William M. Carpenter
William M. Carpenter
President and Chief Executive
Officer
Principal Financial Officer
Date: March 23, 1998 By:/s/ Stephen C. McCluski
Stephen C. McCluski
Senior Vice President and Chief
Financial Officer
Controller
Date: March 23, 1998 By:/s/ Jurij Z. Kushner
Jurij Z. Kushner
Vice President and Controller
Directors
Franklin E. Agnew
William Balderston III
William M. Carpenter
Domenico De Sole
Jonathan S. Linen
Ruth R. McMullin
John R. Purcell
Linda Johnson Rice
Alvin W. Trivelpiece
William H. Waltrip
Kenneth L. Wolfe
Date: March 23, 1998 By:/s/Robert B. Stiles
Robert B. Stiles
Attorney-in-Fact
Bausch & Lomb Incorporated
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
Reserves for Doubtful
Accounts (Dollar December 27, December 28, December 30,
amounts in thousands) 1997 1996 1995
Balance at beginning
of year $ 13,278 $ 11,232 $ 16,830
Activity for the year:
Provision charged to
income 4,310 8,556 8,253
Reductions/(additions)
resulting from divestiture/
(acquisition) activity 68 (399) (821)
Accounts written off (5,179) (6,899) (10,194)
Recoveries on accounts
previously written off 1,538 788 634
Reclassifications -- -- (3,470)
------------------------------------
Balance at end of year $ 14,015 $ 13,278 $ 11,232
------------------------------------
------------------------------------
[FN]
Represents reserves related to trade receivables which have
been reclassified to Notes Receivable.
EXHIBIT INDEX
S-K Item Document
601 No
(3)-a Certificate of Incorporation of Bausch & Lomb
Incorporated (filed as Exhibit (3)-a to the company's Annual
Report on Form 10-K for the fiscal year ended December 29, 1985,
File No. 1-4105, and incorporated herein by reference).
(3)-b Certificate of Amendment of Bausch & Lomb
Incorporated (filed as Exhibit (3)-b to the company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1988,
File No. 1-4105, and incorporated herein by reference).
(3)-c Certificate of Amendment of Bausch & Lomb
Incorporated (filed as Exhibit (3)-c to the company's Annual
Report on Form 10-K for the fiscal year ended December 26, 1992,
File No. 1-4105, and incorporated herein by reference).
(3)-d By-Laws of Bausch & Lomb Incorporated, as amended,
effective October 28, 1986 (filed as Exhibit (3)-b to the
company's Annual Report on Form 10-K for the fiscal year ended
December 28, 1986, File No. 1-4105, and incorporated herein by
reference).
(4)-a See Exhibit (3)-a.
(4)-b See Exhibit (3)-b.
(4)-c See Exhibit (3)-c.
(4)-d Form of Indenture, dated as of September 1, 1991,
between the company and Citibank, N.A., as Trustee, with respect
to the company's Medium-Term Notes (filed as Exhibit 4-(a) to the
company's Registration Statement on Form S-3, File No. 33-42858,
and incorporated herein by reference).
(4)-e Rights Agreement between the company and The First
National Bank of Boston, as successor to Chase Lincoln First
Bank, N.A. (filed as Exhibit 1 to the company's Current Report on
Form 8-K dated July 25, 1988, File No. 1-4105, and incorporated
herein by reference).
(4)-f Amendment to the Rights Agreement between the
company and The First National Bank of Boston, as successor to
Chase Lincoln First Bank, N.A. (filed as Exhibit 1 to the
company's Current Report on Form 8-K dated July 31, 1990, File
No. 1-4105, and incorporated herein by reference).
(10)-a Change of Control Employment Agreement with certain
executive officers of the company (filed as Exhibit (10)-a to the
company's Annual Report on Form 10-K for the fiscal year ended
December 29, 1990, File No. 1-4105, and incorporated herein by
reference).
(10)-b Change of Control Employment Agreement with certain
executive officers of the company (filed as Exhibit (10)-b to the
company's Annual Report on Form 10-K for the fiscal year ended
December 28, 1996, No. 1-4105, and incorporated herein by
reference).
(10)-c Amended and restated Supplemental Retirement Income
Plan II (filed as Exhibit (10)-f to the company's Annual Report
on Form 10-K for the fiscal year ended December 29, 1990, File
No. 1-4105, and incorporated herein by reference).
(10)-d Supplemental Retirement Income Plan III (filed as
Exhibit (10)-g to the company's Annual Report on Form 10-K for
the fiscal year ended December 26, 1992, File No. 1-4105, and
incorporated herein by reference).
(10)-e The 1982 Stock Incentive Plan (filed as Exhibit III-
F to the company's Annual Report on Form 10-K for the fiscal year
ended December 26, 1982, File No. 1-4105, and incorporated herein
by reference).
(10)-f Amendment to the 1982 Stock Incentive Plan (filed as
Exhibit (10)-i to the company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1988, File No. 1-4105, and
Incorporated herein by reference).
(10)-g Amendment to the 1982 Stock Incentive Plan (filed as
Exhibit (10)-k to the company's Annual Report on Form 10-K for
the fiscal year ended December 29, 1990, File No. 1-4105, and
Incorporated herein by reference).
(10)-h The 1987 Stock Incentive Plan (filed as Exhibit I.B
to the company's Registration Statement on Form S-8, File No. 33-
15439, and incorporated herein by reference).
(10)-i Amendment to the 1987 Stock Incentive Plan (filed as
Exhibit (10)-n to the company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1988, File No. 1-4105, and
Incorporated herein by reference).
(10)-j Amendment to the 1987 Stock Incentive Plan (filed as
Exhibit (10)-n to the company's Annual Report on Form 10-K for
the fiscal year ended December 29, 1990, File No. 1-4105, and
Incorporated herein by reference).
(10)-k Amended and restated 1990 Stock Incentive Plan
(filed as Exhibit (10)-y to the company's Annual Report on form
10-K for the fiscal year ended December 28, 1996, File No. 1-
4105, and Incorporated herein by reference).
(10)-l Amended and restated Director Deferred Compensation
Plan (filed as Exhibit (10)-bb to the company's Annual Report on
Form 10-K for the fiscal year ended December 28, 1996, File No.
1-4105, and incorporated herein by reference).
(10)-m Amended and restated Executive Deferred Compensation
Plan (filed as Exhibit (10)-cc to the company's Annual Report on
Form 10-K for the fiscal year ended December 28, 1996, File No.
1-4105, and incorporated herein by reference).
(10)-n Amended and restated Executive Benefit Plan (filed
as Exhibit (10)-t to the company's Annual Report on Form 10-K for
the fiscal year ended December 29, 1990, File No. 1-4105, and
Incorporated herein by reference).
(10)-o Executive Security Program (filed as Exhibit (10)-s
to the company's Annual Report on Form 10-K for the fiscal year
ended December 30, 1989, File No. 1-4105, and incorporated herein
by reference).
(10)-p Retirement Benefit Restoration Plan (filed as
Exhibit (10)-t to the company's Annual Report on Form 10-K for
the fiscal year ended December 28, 1991, File No. 1-4105, and
incorporated herein by reference).
(10)-q Annual Retainer Stock Plan for Non-Employee
Directors (filed as Exhibit (10)-dd to the company's Annual
Report on Form 10-K for the fiscal year ended December 28, 1996,
File No. 1-4105, and incorporated herein by reference).
(10)-r Stock Purchase Agreement by and between Bausch &
Lomb Incorporated and Chiron Corporation (filed as Exhibit 2(a)
to the company's Current Report on Form 8-K dated January 13,
1998, File No. 1-4105, and incorporated herein by reference).
(10)-s Purchase Agreement by and among American Cyanamid
Company, American Home Products Corporation and Bausch & Lomb
Incorporated (filed as Exhibit 2(b) to the company's Current
Report on Form 8-K dated January 13, 1998, File No. 1-4105, and
incorporated herein by reference).
(10)-t Amended and restated Charles River Laboratories,
Inc. Executive Life Insurance/Supplemental Retirement Income Plan
(filed herewith).
(10)-u Agreement with William H. Waltrip (filed herewith).
(10)-v Corporate Officer Separation Plan (filed herewith).
(10)-w EVA Management Incentive Compensation Plan (filed
herewith).
(11) Statement Regarding Computation of Per Share
Earnings (filed herewith).
(12) Statement Regarding Computation of Ratio of Earnings
to Fixed Charges (filed herewith).
(13) The Bausch & Lomb 1997 Annual Report to Shareholders
for the fiscal year ended December 27, 1997 (filed herewith).
With the exception of the pages of the Annual Report specifically
incorporated by reference herein, the Annual Report is not deemed
to be filed as a part of this Report on Form 10-K.
(21) Subsidiaries (filed herewith).
(23) Report of Independent Accountants on Financial
Statement Schedules and Consent of Independent Accountants (filed
herewith).
(24) Power of attorney with respect to the signatures of
directors in this Report on Form 10-K (filed herewith).
(27) Financial Data Schedule (filed herewith).