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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________
FORM 10-K
__
| X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2002
OR
__
|__| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________ to _________________
Commission file number 1-7928
BIO-RAD LABORATORIES, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 94-1381833
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
1000 Alfred Nobel Drive, Hercules, CA 94547
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (510)724-7000
Securities registered pursuant to Section 12(b) of the Act:
Market Value on
Name of Each Exchange Shares Outstanding March 4, 2003 of Stocks
Title of Each Class on Which Registered March 4, 2003 Held by Non-Affiliates
------------------- --------------------- ------------------ ------------------------
Class A Common Stock
Par Value $0.0001 per share American Stock Exchange 20,443,314 $596,629,362
Class B Common Stock
Par Value $0.0001 per share American Stock Exchange 4,851,942 $ 20,676,246
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 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. [ ]
Indicate by check mark whether the registrant is an accelerated
filer (as defined in Rule 126-2 of the Act). Yes X No____
Documents Incorporated by Reference
Document Form 10-K Parts
_________________________________________ ____________________
(1) Annual Report to Stockholders for the
fiscal year ended December 31, 2001
(specified portions) I, II, IV
(2) Definitive Proxy Statement to be mailed
to stockholders in connection with the
registrant's 2002 Annual Meeting of
Stockholders (specified portions) III
P A R T I
ITEM 1. BUSINESS
General
Founded in 1957, Bio-Rad Laboratories, Inc. ("Bio-Rad" or the
"Company") was initially engaged in the development and
production of specialty chemicals used in biochemical,
pharmaceutical and other life science research applications. In
1967, the Company entered the field of clinical diagnostics with
the development of its first test kit based on separation
techniques and materials developed for life science research.
Recognizing that the fields of clinical diagnostics and life
science research were evolving toward more automated techniques,
Bio-Rad expanded into the field of analytical and measuring
instrument systems through internal research and development
efforts and acquisitions in the late 1970's and 1980's.
As Bio-Rad broadened its product lines, it also expanded its
geographical market. The Company has distribution
channels in thirty countries outside the United States through
subsidiaries whose primary focus is customer service and
product distribution.
On October 1, 1999 Bio-Rad acquired the stock of Pasteur Sanofi
Diagnostics (PSD) and the rights to certain ancillary assets for
$210 million. PSD was founded by the Institut Pasteur to
commercialize its diagnostic research, and holds certain
exclusive licenses from the Institut Pasteur in the HIV and
infectious disease diagnostic product market. PSD also expanded
the geographic reach and market penetration for the Company's
product particularly in Latin America, Africa and France.
During 2000 and 2001, the Company sold substantially all of its
analytical instruments product lines. These divestitures have
allowed the Company to focus on its core segments of Life Science
and Clinical Diagnostics.
Bio-Rad manufactures and supplies the life science research,
healthcare, analytical chemistry and other markets with a broad
range of products and systems used to separate complex chemical
and biological materials and to identify, analyze and purify
their components.
Description of Business
Business Segments
The Company operates in two industry segments designated as Life
Science and Clinical Diagnostics. Each operates in both the
United States and international markets. For a description of
business and financial information on industry and geographic
segments, see Note 15 on pages 27 through 29 of Exhibit 13.1,
which is incorporated herein by reference.
1
Life Science Segment.
Life science is the study of the characteristics, behavior, and
structure of living organisms and their component systems. Life
science researchers use a variety of products and systems--
including reagents, instruments, software and apparatus-- to
advance the study of life processes, drug discovery,
biotechnology and food pathogen testing, primarily within a
laboratory setting.
We focus on selected segments of the life science market--
proteomics, genomics and cell biology -- for which we estimate
2002 worldwide sales totaled approximately $3 billion. The
primary technological applications that we supply to these
segments consist of electrophoresis, image analysis, molecular
detection, chromatography, gene transfer, sample preparation and
amplification. The primary end-users in our sectors of the
market are universities and medical schools, industrial research
organizations, government agencies, pharmaceutical manufacturers,
biotechnology researchers and food testing laboratories.
Clinical Diagnostics Segment.
The clinical diagnostics industry encompasses a broad array of
technologies incorporated into a variety of tests used to detect,
identify and quantify substances in blood or other bodily fluids
and tissues. The test results are used as aids for medical
diagnosis, detection, evaluation, monitoring and treatment of
diseases and other medical conditions. The bulk of tests are
performed in vitro (literally, "in glass"), while the remainder
consists of in vivo ("in the body") tests. The most common type
of in vitro tests are routine chemistry tests that measure
important health parameters, such as glucose, cholesterol or
sodium, as part of routine blood checks. Other diagnostic tests
are more specialized and require more sophisticated equipment and
materials than do routine tests. These specialized tests are
also lower-volume and higher-priced than routine tests. We
estimate that in 2002 sales to the global clinical diagnostics
industry totaled approximately $22 billion.
The primary end-users in the areas of the clinical diagnostics
industry we target are hospital laboratories, reference
laboratories, physician office laboratories, government agencies
and other diagnostics manufacturers.
Raw Materials and Components
The Company utilizes a wide variety of chemicals, biological
materials, electronic components, machined metal parts, optical
parts, minicomputers and peripheral devices. Most of these
materials and components are available from numerous sources and
the Company has not experienced difficulty in securing adequate
supplies.
2
Patents and Trademarks
We own numerous U.S. and international patents and patent
licenses. We believe, however, that our ability to develop and
manufacture our products depends primarily on our knowledge,
technology and special skills. Under several patent license
agreements, we pay royalties on the sales of certain products.
We view these patents and license agreements as valuable assets.
Seasonal Operations and Backlog
The Company's business is not inherently seasonal, however, the
European custom of concentrating vacation during the summer
months usually has had a negative impact on third quarter sales
volume and operating income.
For the most part, the Company operates in markets characterized
by short lead times and the absence of significant backlogs.
Management has concluded that backlog information is not material
to the Company's business as a whole.
Sales and Marketing
Each of Bio-Rad's segments maintains a sales force to sell its
products on a direct basis. Each sales force is technically
trained in the disciplines associated with its products. Sales
are also generated through direct mail advertising, exhibits at
trade shows and technical meetings, telemarketing, the Company
website and by extensive advertising in technical and trade
publications. Sales and marketing efforts are augmented by
technical service departments that assist customers in effective
product utilization and in new product applications. Bio-Rad
also produces and distributes technical literature and holds
seminars for customers on the use of its products.
Our customer base is broad and diversified. In 2002, no single
customer accounted for more than 2% of our total net sales. Our
sales are affected by certain external factors. For example, a
number of our customers, particularly in the Life Science
segment, are substantially dependent on government grants and
research contracts for their funding. A significant reduction of
government funding would have a detrimental effect on the results
of this segment.
The Company is the leading provider of BSE (Bovine Spongiform
Encephalopathy or mad cow) tests throughout the world. A large
portion of the revenue for this product is from government
agencies currently mandating the use of the test. Competition,
pricing, changes in test standards, technology or a decrease in
government demand could negatively impact the Company's future
revenue from this product.
Most of the Company's international sales are generated by
wholly-owned subsidiaries and their branch offices in Australia,
Austria, Belgium, Brazil, Canada, the Czech Republic, Denmark,
England, Finland, France, Germany, Hong Kong, Hungary,
3
India, Israel, Italy, Japan, Korea, Mexico, the Netherlands, New
Zealand, Norway, People's Republic of China, Poland, Portugal,
Russia, Singapore, South Africa, Spain, Sweden, Switzerland,
Taiwan and Thailand. Certain of these subsidiaries also have
manufacturing facilities. While Bio-Rad's international
operations are subject to certain risks common to foreign
operations in general, such as changes in governmental
regulations, import restrictions and foreign exchange
fluctuations, the Company's international operations are
principally in developed nations, which the Company regards as
presenting no significantly greater risks to its operations than
are present in the United States.
Competition
Most markets served by our product groups are competitive. Our
competitors range in size from start-ups to large multinational
corporations. Reliable independent information on sales and
market share of products produced by our competitors is not
generally available. We believe, however, based on our own
marketing information, that while some competitors are dominant
with respect to certain individual products, no one company,
including us, is dominant with respect to a material portion of
any segment of our business.
Life Science Segment. Because of the breadth of its product
lines, Life Science does not face the same competitor for all of
its products. Competitors in this market include Amersham
Biosciences, Invitrogen, Qiagen, Zeiss and Applied Biosystems.
We compete primarily on meeting performance specifications.
Clinical Diagnostics Segment. Competitors in this segment range
in size from small private companies to large multinational
corporations. We compete only in very specific market niches and
do not attempt to pursue the most competitive general diagnostics
markets. We compete based on our technological ability to
provide customers with very specific tests and believe we are
usually a significant competitor within our market niche.
Competitors include Abbott Laboratories, bioMerieux, Inc., Roche
Diagnostics, BioChem Pharma, Inova, diaSorin and Medical Analysis
Systems.
Product Research and Development
The Company conducts extensive product research and development
activities in all areas of our business, employing approximately
500 people worldwide in these activities. Research and
development have played a major role in Bio-Rad's growth and are
expected to continue to do so in the future. Our research teams
are continuously developing new products and new applications for
existing products. In our development and testing of new
products and applications, we consult with scientific and medical
professionals at universities, hospitals and medical schools, and
in industry. We spent approximately $82.9 million, $76.5 million
and $68.1 million on research and development activities during
the years ended December 31, 2002, 2001, and 2000, respectively.
4
Regulatory Matters
The manufacturing, marketing and labeling of certain of our
products (primarily diagnostic products) are subject to
regulation in the United States by the Center for Devices and
Radiological Health of the United States Food and Drug
Administration (FDA) and in other jurisdictions by state and
foreign government authorities. FDA regulations require that
some new products have pre-marketing approval by the FDA and
require certain products to be manufactured in accordance with
"good manufacturing practices," to be extensively tested and to
be properly labeled to disclose test results and performance
claims and limitations.
As a multinational manufacturer and distributor of sophisticated
instrumentation equipment, we must meet a wide array of
electromagnetic compatibility and safety compliance requirements
to satisfy regulations in the United States, the European
Community and other jurisdictions. The FDA must approve an
export permit application before companies can market products
outside the U.S. prior to the products' receipt of FDA approval.
The requirements relating to testing and trials, product
licensing, pricing and reimbursement vary widely among countries.
Our operations are subject to federal, state, local and foreign
environmental laws and regulations that govern such activities as
emissions to air and discharges to water, as well as handling and
disposal practices for solid, hazardous and medical wastes. In
addition to environmental laws that regulate our operations, we
are also subject to environmental laws and regulations that
create liabilities and clean-up responsibility for spills,
disposals or other releases of hazardous substances into the
environment as a result of our operations or otherwise impacting
real property that we own or operate. The environmental laws and
regulations also subject us to claims by third parties for
damages resulting from any spills, disposals or releases
resulting from our operations or at any of our properties.
Employees
At December 31, 2002, Bio-Rad had approximately 4,600 full-time
employees. Fewer than 11% of Bio-Rad's 2,200 U. S. employees are
covered by a collective bargaining agreement which will expire on
November 7, 2006. Many of Bio-Rad's non-U.S. full-time
employees, especially in France, are covered by collective
bargaining agreements. Bio-Rad considers its employee relations
in general to be good.
Available Information
The Company files annual, quarterly, and current reports, proxy
statements, and other documents with the Securities and Exchange
Commission (SEC) under the Securities Exchange Act of 1934. The
public may read and copy any materials that the Company files
with the SEC at the SEC's Public Reference Room at 450 Fifth
Street, NW, Washington, DC 20549. The public may obtain
information on the operation of the Public Reference Room by
5
calling the SEC at 1-800-SEC-0330. Also, the SEC maintains an
Internet website that contains reports, proxy and information
statements, and other information regarding issuers, including
the Company, that file electronically with the SEC. The public
can obtain any documents that the Company files with the SEC at
http://www.sec.gov.
The Company's website address is www.bio-rad.com. The Company
makes available, free of charge through its Internet website, its
Form 10-K's, 10-Q's and 8-K's, and any amendments to these forms,
as soon as reasonably practicable after filing with the SEC.
ITEM 2. PROPERTIES
We own our Corporate headquarters located in Hercules,
California. The principal manufacturing and research locations
for each segment are as follows:
Approximate
Segment Location Square Ftg. Owned/Leased
Life Science Richmond, California 201,000 Owned/Leased
Hercules, California 114,600 Owned
Hemel Hempstead, England 102,000 Leased
Milan, Italy 50,000 Leased
Clinical
Diagnostics Hercules, California 135,000 Owned/Leased
Irvine, California 185,900 Leased
Greater Seattle,
Washington 127,600 Owned/Leased
Lille, France 182,000 Owned
Paris, France 162,000 Leased
Munich, Germany 55,000 Leased
Nazareth-Eke, Belgium 30,000 Leased
Most manufacturing and research facilities also house
administration, sales and distribution activities. In addition,
we lease office and warehouse facilities in a variety of
locations around the world. The facilities are used principally
for sales, service, distribution and administration for both
segments.
The Life Science segment's Richmond, California distribution and
instrument manufacturing facility lease expires in November 2005.
The Marnes la Coquette facility near Paris, France which served
as the corporate headquarters for PSD, as well as a significant
manufacturing and research facility has been renewed until
December 31, 2005.
The Company is currently building additional facilities at its
Northern California headquarters. Historically, adequate space
to expand sales and distribution channels has been available and
we have leased space as needed.
6
ITEM 3. LEGAL PROCEEDINGS
Note 14, "Legal Proceedings," appearing on page 26 of the Exhibit
13.1 is incorporated herein by reference.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters submitted to a vote of the Company's
security holders during the fourth quarter of the fiscal year
covered by this report.
P A R T II
ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED
STOCKHOLDER MATTERS
Information Concerning Common Stock
The Company's Class A and Class B Common Stock are listed on the
American Stock Exchange with the symbols BIO and BIO.B,
respectively. The following sets forth, for the periods
indicated, the high and low prices for the Company's Class A and
Class B Common Stock.
Class A Class B
High Low High Low
2002
Fourth Quarter 45.90 36.25 44.35 37.00
Third Quarter 45.99 34.90 45.00 36.00
Second Quarter 51.00 36.30 50.25 38.50
First Quarter 38.00 27.45 37.50 27.50
2001
Fourth Quarter 33.00 22.85 32.50 22.50
Third Quarter 28.88 21.00 27.00 22.50
Second Quarter 25.65 17.05 24.75 19.75
First Quarter 21.00 14.88 20.25 15.00
On March 4, 2003 the Company had 1,133 holders of record of Class
A Common Stock and 218 holders of record of Class B Common Stock.
Bio-Rad has never paid a cash dividend and has no present plans
to pay cash dividends.
ITEM 6. SELECTED FINANCIAL DATA
The table headed "Summary of Operations and Selected Financial
Data" appearing on page 1 of Exhibit 13.1 is incorporated herein
by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The section headed "Management's Discussion and Analysis of
Results of Operations and Financial Condition" appearing on pages
7
33 through 41 of Exhibit 13.1 is incorporated herein by
reference.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
The section headed "Financial Risk Management" appearing on pages
40-41 of Exhibit 13.1 is incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The Consolidated Financial Statements and Notes thereto and the
Reports of Independent Public Accountants appearing on pages 2
through 32 of Exhibit 13.1 are incorporated herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
The Company filed a current report on Form 8-K with the SEC on
July 10, 2002 noting a change in independent public accountants.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The sections labeled "Election of Directors" and "Section 16(a)
Beneficial Ownership Reporting Compliance" of the definitive
Proxy Statement mailed to stockholders in connection with the
2003 Annual Meeting of Stockholders ("the 2003 Proxy Statement")
are incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION
The sections labeled "Executive Compensation and Other
Information," "Compensation of Directors," "Compensation
Committee Interlocks and Insider Participation," "Report of the
Compensation Committee of the Board of Directors" and "Stock
Performance Graph" of the 2003 Proxy Statement are incorporated
herein by reference.
8
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The section labeled "Principal and Management Stockholders" of
the 2003 Proxy Statement is incorporated herein by reference.
(a) (b) (c)
Number of Number of securities
securities remaining available
to be issued Weighted-average for future issuance
upon exercise exercise price under equity
of outstanding of outstanding compensation plans
options, warrants options, warrants (excluding securities
Plan Category and rights and rights reflected in column(a))
Equity compensation
plans approved by
security holders (1) 1,591,832 $ 15.84 1,472,880 (2)
Equity compensation
plans not approved
by stockholders - - -
--------- --------- ---------
Total 1,591,832 $ 15.84 1,472,880
========= ========= =========
(1) Consists of the Bio-Rad Laboratories, Inc. 1994 Stock Option
Plan and the Bio-Rad Laboratories, Inc. Employee Stock
Purchase Plan.
(2) Consists of 1,132,327 shares available for issuance under
the Bio-Rad Laboratories, Inc. 1994 Stock Option Plan and
340,553 shares available for issuance under the Bio-Rad
Laboratories, Inc. Employee Stock Purchase Plan.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The section labeled "Certain Relationships and Related Party
Transactions" and "Compensation of Directors" of the 2003 Proxy
Statement is incorporated herein by reference.
ITEM 14. CONTROLS AND PROCEDURES
Within 90 days prior to the date of this report, the Company
carried out an evaluation, under the supervision and with the
participation of the Company's management, including the
Company's Chief Executive Officer and the Company's Chief
Financial Officer, of the effectiveness of the design and
operation of the Company's disclosure controls and procedures.
Based on the foregoing, the Company's Chief Executive Officer and
Chief Financial Officer concluded that the Company's disclosure
controls and procedures were effective.
There have been no significant changes in the Company's internal
controls or in other factors that could significantly affect the
internal controls subsequent to the date the Company completed
its evaluation.
9
P A R T IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
FORM 8-K
(a) 1. Index to Financial Statements
The following Consolidated Financial Statements are
included in Exhibit 13.1 and are incorporated
herein by reference pursuant to Item 8:
Page in
Exhibit 13.1
Consolidated Balance Sheets
at December 31, 2002 and 2001 2-3
Consolidated Statements of Income
for each of the three years in the
period ended December 31, 2002 4
Consolidated Statements of Cash Flows
for each of the three years in the period
ended December 31, 2002 5
Consolidated Statements of Changes in
Stockholders' Equity for each of the three
years in the period ended December 31, 2002 6
Notes to Consolidated Financial Statements 7-29
Independent Auditors' Report 30-31
Report of Independent Public Accountants 32
2. Index to Financial Statement Schedule
Page in
Form 10-K
Schedule II Valuation and Qualifying Accounts 11
Independent Auditors' Report on
Supplemental Schedule 12
Report of Independent Public Accountants
on Schedule II 13
All other financial statement schedules are omitted because
they are not required or because the required information is
included in the Consolidated Financial Statements or the Notes
thereto.
3. Index to Exhibits
The exhibits listed in the accompanying Index to Exhibits on
pages 13 through 15 of this report are filed or incorporated by
reference as part of this report.
(b) Reports on Form 8-K
Bio-Rad filed a current report on Form 8-K with the SEC on
December 23, 2002, announcing executive management transition
plans.
10
BIO-RAD LABORATORIES, INC,.
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
Years Ended December 31, 2002, 2001 and 2000
(In thousands)
Reserve for doubtful accounts receivable
Additions
Balance at Charged to Balance
Beginning Costs and at End
of Year Expenses Deductions Other of Year
2002 . . . $11,509 $2,857 $(2,244) -- $12,122
====== ====== ====== ====== ======
2001 . . . $10,255 $5,200 $(3,946) -- $11,509
====== ====== ====== ====== ======
2000 . . . $ 9,582 $4,298 $(3,625) -- $10,255
====== ====== ====== ====== ======
Valuation allowance for deferred tax assets
Deductions
Balance at Charged to Balance
Beginning Costs and at End
of Year Additions Expenses Other(A) of Year
2002 . . . . $17,302 $1,241 $(2,342) $(3,334) $12,867
====== ====== ====== ====== ======
2001 . . . . $20,620 $4,959 $(2,793) $(5,484) $17,302
====== ====== ====== ====== ======
2000 . . . . $24,131 $3,600 $(3,431) $(3,680) $20,620
====== ====== ====== ====== ======
(A) Valuation arising from the acquisition of PSD.
11
INDEPENDENT AUDITORS' REPORT ON SUPPLEMENTAL SCHEDULE
To the Board of Directors and Shareholders of
Bio-Rad Laboratories, Inc.
We have audited the consolidated financial statements of Bio-Rad
Laboratories, Inc. and subsidiaries (the "Company") as of
December 31, 2002, and for the year then ended, and have issued
our report thereon dated February 5, 2003 (which report expresses
an unqualified opinion and includes an explanatory paragraph
concerning the application of procedures relating to certain
disclosures of consolidated financial statement amounts related
to the 2001 and 2000 consolidated financial statements that were
audited by other auditors who have ceased operations); such
consolidated financial statements and report are included in the
Company's 2002 Annual Report to the Shareholders and are
incorporated herein by reference. Our audit also included the
2002 consolidated financial statement schedule of the Company,
listed in Item 15. This consolidated financial statement
schedule is the responsibility of the Company's management. Our
responsibility is to express an opinion based on our audit. In
our opinion, the consolidated 2002 financial statement schedule,
when considered in relation to the 2002 basic consolidated
financial statements taken as a whole, presents fairly in all
material respects the information set forth therein. The
financial statement schedules for the years ended December 31,
2001 and 2000 were audited by other auditors who have ceased
operations. Those auditors expressed an opinion, in their report
dated February 4, 2002, (February 6, 2002, as to a subsequent
event), that such 2001 and 2000 financial statement schedules,
when considered in relation to the 2001 and 2000 basic financial
statements taken as a whole (prior to the disclosures referred to
above), presented fairly in all material respects the information
set forth therein.
/s/ DELOITTE & TOUCHE LLP
San Francisco, California
February 5, 2003
12
This report is a copy of the previously issued
report covering 2001, 2000, and 1999. The
predecessor auditors have not reissued their report.
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ON SCHEDULE II
To Bio-Rad Laboratories, Inc.:
We have audited in accordance with auditing standards generally
accepted in the United States, the consolidated financial
statements included in Bio-Rad Laboratories, Inc.'s annual report
to stockholders incorporated by reference in this Form 10-K, and
have issued our report thereon dated February 4, 2002. Our
audits were made for the purpose of forming an opinion on those
statements taken as a whole. The schedule listed in the index,
Item 14(a)2, is the responsibility of the Company's management
and is presented for the purposes of complying with the
Securities and Exchange Commission's rules and is not part of the
basic financial statements. This schedule has been subjected to
the auditing procedures applied in the audits of the basic
financial statements and, in our opinion, fairly states in all
material respects the financial data required to be set forth
therein in relation to the basic financial statements taken as a
whole.
ARTHUR ANDERSEN LLP
San Francisco, California
February 4, 2002
13
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.
BIO-RAD LABORATORIES, INC.
By: /s/ Sanford S. Wadler
Sanford S. Wadler
Secretary
Date: March 26, 2003
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:
/s/ Norman Schwartz President and Director March 26, 2003
(Norman Schwartz)
Principal Financial Officer:
Vice President,
/s/ Christine A. Tsingos Chief Financial Officer March 26, 2003
(Christine Tsingos)
Principal Accounting Officer:
/s/ James R. Stark Corporate Controller March 26, 2003
(James R. Stark)
Other Directors:
/s/ James J. Bennett Director March 26, 2003
(James J. Bennett)
/s/ Albert J. Hillman Director March 26, 2003
(Albert J. Hillman)
/s/ Ruediger A. Naumann Director March 26, 2003
(Ruediger A. Naumann)
/s/ Philip L. Padou Director March 26, 2003
(Philip L. Padou)
/s/ Alice N. Schwartz Director March 26, 2003
(Alice N. Schwartz)
/s/ David Schwartz Director March 26, 2003
(David Schwartz)
14
CERTIFICATIONS
I, Norman Schwartz, certify that:
1. I have reviewed this annual report on Form 10-K of Bio-Rad
Laboratories, Inc.
2. Based on my knowledge, this annual report does not contain
any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in
light of the circumstances under which such statements were
made, not misleading with respect to the period covered by
this annual report;
3. Based on my knowledge, the financial statements, and other
financial information included in this annual report fairly
present, in all material respects the financial condition,
results of operations and cash flows of the registrant as
of, and for, the periods presented in this annual report;
4. The registrant's other certifying officer and I are
responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules
13a-14 and 15d-14) for the registrant and have:
a. designed such disclosure controls and procedures
to ensure that material information relating to
the registrant, including its consolidated
subsidiaries, is made known to us by others within
those entities, particularly during the period in
which this annual report is being prepared;
b. evaluated the effectiveness of the registrant's
disclosure controls and procedures as of a date
within 90 days prior to the filing date of this
annual report (the "Evaluation Date"); and
c. presented in this annual report our conclusions
about the effectiveness of the disclosure controls
and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officer and I have
disclosed, based on our most recent evaluation, to the
registrant's auditors and the audit committee of the
registrant's board of directors (or persons performing the
equivalent functions);
a. all significant deficiencies in the design or
operation of internal controls which could
adversely affect the registrant's ability to
record, process, summarize and report financial
data and have identified for the registrant's
auditors any material weakness in internal
controls; and
15
b. any fraud, whether or not material, that involves
management or other employees who have a
significant role in the registrant's internal
controls; and
6. The registrant's other certifying officer and I have
indicated in this annual report whether or not there
were significant changes in internal controls or in
other factors that could significantly affect internal
controls subsequent to the date of our most recent
evaluation, including any corrective actions with
regard to significant deficiencies and material
weaknesses.
Date: March 26, 2003 /s/ Norman Schwartz
-----------------------------------
Norman Schwartz
Chief Executive Officer
16
CERTIFICATIONS
I, Christine A. Tsingos, certify that:
1. I have reviewed this annual report on Form 10-K of Bio-Rad
Laboratories, Inc.
2. Based on my knowledge, this annual report does not contain
any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in
light of the circumstances under which such statements were
made, not misleading with respect to the period covered by
this annual report;
3. Based on my knowledge, the financial statements, and other
financial information included in this annual report fairly
present, in all material respects the financial condition,
results of operations and cash flows of the registrant as
of, and for, the periods presented in this annual report;
4. The registrant's other certifying officer and I are
responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules
13a-14 and 15d-14) for the registrant and have:
a. designed such disclosure controls and procedures
to ensure that material information relating to
the registrant, including its consolidated
subsidiaries, is made known to us by others within
those entities, particularly during the period in
which this annual report is being prepared;
b. evaluated the effectiveness of the registrant's
disclosure controls and procedures as of a date
within 90 days prior to the filing date of this
annual report (the "Evaluation Date"); and
c. presented in this annual report our conclusions
about the effectiveness of the disclosure controls
and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officer and I have
disclosed, based on our most recent evaluation, to the
registrant's auditors and the audit committee of the
registrant's board of directors (or persons performing the
equivalent functions);
a. all significant deficiencies in the design or
operation of internal controls which could
adversely affect the registrant's ability to
record, process, summarize and report financial
data and have identified for the registrant's
auditors any material weakness in internal
controls; and
17
b. any fraud, whether or not material, that involves
management or other employees who have a
significant role in the registrant's internal
controls; and
6. The registrant's other certifying officer and I have
indicated in this annual report whether or not there
were significant changes in internal controls or in
other factors that could significantly affect internal
controls subsequent to the date of our most recent
evaluation, including any corrective actions with
regard to significant deficiencies and material
weaknesses.
Date: March 26, 2003 /s/ Christine A. Tsingos
-----------------------------------
Christine A. Tsingos
Vice President,
Chief Financial Officer
18
BIO-RAD LABORATORIES, INC.
INDEX TO EXHIBITS
ITEM 14(a)3
The following documents are filed as part of this report:
Exhibit No.
3.1 Restated Certificate of Incorporation, as of
February 8, 2002. (1)
3.2 Bylaws of the Registrant, as amended February 19,
1980. (2)
4.1 Credit Agreement dated as of September 30, 1999 among
Bio-Rad Laboratories, Inc., the lenders named therein,
Bank One, N.A., as Administrative Agent, ABN Amro Bank
N.V. as Syndication Agent and Union Bank of California,
N.A. as Documentation Agent. (3)
4.1.1 Amendment dated as of January 31, 2000, to the Credit
Agreement dated as of September 30, 1999, by and among
Bio-Rad Laboratories, Inc. the lenders named therein,
and Bank One, N.A. as Agent. (4)
4.1.2 Amendment dated as of June 21, 2000 to the Credit
Agreement dated as of September 30, 1999, among Bio-Rad
Laboratories, Inc., the lenders named therein, Banc
One, N.A. as Administrative Agent, ABN AMRO Bank N.V.
as Syndication Agent, and Union Bank of California,
N.A. as Documentation Agent. (6)
4.1.3 Amendment dated as of August 9, 2003 to the Credit
Agreement dated as of September 30, 1999, by and among
Bio-Rad Laboratories, Inc., the Lenders named therein,
and Bank One, N.A. as Agent. (5)
4.1.4 Amendment dated as of February 12, 2003 to the Credit
Agreement dated as of September 30, 1999 by and among
Bio-Rad Laboratories, Inc., the Lenders names therein
and Bank One, N.A. as Agent.
4.2 Senior Subordinated Credit Agreement dated as of
September 30, 1999 among Bio-Rad Laboratories, Inc.,
the lenders named therein and Bank One Capital Markets,
Inc., as Agent. (3)
4.4 Senior Subordinated Credit Agreement dated as of
January 31, 2000 among Bio-Rad Laboratories, Inc., the
lenders named therein and UBS AG, Stamford Branch, as
Agent. (4)
4.5 The Indenture dated as of February 17, 2000 for 11.625%
Senior Subordinated Notes due 2007 among Bio-Rad
Laboratories, Inc., as Issuer, and Norwest Bank
Minnesota, N.A., as Trustee. (4)
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4.6 The Registration Rights Agreement dated as of February
17, 2000 by and among Bio-Rad Laboratories, Inc. and
Warburg Dillon Reed LLC and ABN AMRO Incorporated. (4)
10.4 1994 Stock Option Plan. (7)
10.4.1 Amendment to the Bio-Rad Laboratories, Inc. 1994 Stock
Option Plan dated April 28, 1998. (8)
10.4.2 Second Amendment to the Bio-Rad Laboratories, Inc. 1994
Stock Option Plan dated December 6, 1999. (8)
10.4.3 Third Amendment to the Bio-Rad Laboratories, Inc. 1994
Stock Option Plan dated September 19, 2000. (8)
10.5 Amended and Restated 1988 Employee Stock Purchase Plan.
(9)
10.6 Employees' Deferred Profit Sharing Retirement Plan
(Amended and Restated effective January 1, 1997). (11)
10.10 Non-competition and employment continuation agreement
with James J. Bennett. (11)
10.12 Split Dollar Life Insurance Agreement dated
September 17, 1999 between the Schwartz Irrevocable
Descendants Trust and Bio-Rad Laboratories, Inc. (4)
13.1 Excerpt from Annual Report to Stockholders' for the
fiscal year ended December 31, 2002, (to be deemed
filed only to the extent required by the instructions
to exhibits for reports on Form 10-K).
21.1 Listing of Subsidiaries.
23.1 Consent of Independent Public Accountants.
99.1 Certification of Chief Executive Officer.
99.2 Certification of Chief Financial Officer
______________________________________________________________
(1) Incorporated by reference from Exhibits to the
Company's Form 10-K filing for the fiscal year ended
December 31, 2001, dated March 28, 2002.
(2) Incorporated by reference from the Exhibits to the
Company's Registration Statement on Form S-7
Registration No. 2-66797, which became effective
April 22, 1980.
(3) Incorporated by reference from Exhibits to the
Company's Form 8-K dated October 1, 1999.
(4) Incorporated by reference from the Exhibits to the
Company's Form 10-K filing for the fiscal year ended
20
December 31, 1999, dated March 28, 2000.
(5) Incorporated by reference from Exhibits to the
Company's September 30, 2002, Form 10-Q filing dated
November 13, 2002.
(6) Incorporated by reference from Exhibits to the
Company's June 30, 2000, Form 10-Q filing dated
August 14, 2000.
(7) Incorporated by reference from the Exhibits to the
Company's Form S-8 filing, dated April 28, 1994.
(8) Incorporated by reference from the Exhibits to the
Company's Form 10-K filing for the fiscal year ended
December 31, 2000, dated March 28, 2001.
(9) Incorporated by reference from the Exhibits to the
Company's September 30, 1998, Form 10-Q filing dated
November 10, 1998.
(10) Incorporated by reference from the Exhibits to the
Company's September 30, 1997, Form 10-Q filing dated
November 13, 1997.
(11) Incorporated by reference from the Exhibits to the
Company's Form 10-K filing for the fiscal year ended
December 31, 1996, dated March 26, 1997.
21