<PAGE>   1
 
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                                 UNITED STATES
 
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549
                            ------------------------
 
                                   FORM 10-K
 
(MARK ONE)
 
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
   EXCHANGE ACT OF 1934
 
                   FOR THE FISCAL YEAR ENDED JANUARY 2, 2000
 
                                       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 1-5075
 
                               PERKINELMER, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
 

<TABLE>
<S>                                            <C>
 
                MASSACHUSETTS                                   04-2052042
(STATE OR OTHER JURISDICTION OF INCORPORATION      (I.R.S. EMPLOYER IDENTIFICATION NO.)
              OR ORGANIZATION)
                                                                   02481
 45 WILLIAM STREET, WELLESLEY, MASSACHUSETTS                    (ZIP CODE)
  (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
</TABLE>

 
       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (781) 237-5100
          SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
 

<TABLE>
<CAPTION>
             TITLE OF EACH CLASS                 NAME OF EACH EXCHANGE ON WHICH REGISTERED
             -------------------                 -----------------------------------------
<S>                                            <C>
         COMMON STOCK, $1 PAR VALUE                    NEW YORK STOCK EXCHANGE, INC.
       PREFERRED SHARE PURCHASE RIGHTS                 NEW YORK STOCK EXCHANGE, INC.
</TABLE>

 
       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. [ ]
 
     The aggregate market value of the common stock, $1 par value, held by
nonaffiliates of the registrant on February 25, 2000, was $3,051,477,513.
 
     As of February 25, 2000, there were outstanding, exclusive of treasury
shares, 48,656,003 shares of common stock, $1 par value.
 
                      DOCUMENTS INCORPORATED BY REFERENCE
 

<TABLE>
<S>                                                        <C>
PORTIONS OF PERKINELMER, INC.'S PROXY STATEMENT FOR THE
  2000 ANNUAL MEETING OF STOCKHOLDERS....................     PART III (Items 10, 11, 12 and 13)
</TABLE>

 
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--------------------------------------------------------------------------------

<PAGE>   2
 

                                     PART I
 

ITEM 1.  BUSINESS
 
GENERAL BUSINESS DESCRIPTION
 
     PerkinElmer, Inc. (hereinafter referred to as "PerkinElmer", the "Company",
or the "Registrant", which terms include the Company's subsidiaries) is a global
technology company which provides products and systems to the telecom, medical,
pharmaceutical, chemical, semiconductor and photographic markets. The Company
has operations in over 100 countries, and is a component of the S&P 500 Index.
The Company's continuing operations are classified into four operating segments:
Life Sciences, Optoelectronics, Instruments, and Fluid Sciences. In 1999 the
Company had sales of $1.4 billion from continuing operations. The Company was
incorporated under the laws of the Commonwealth of Massachusetts in 1947.
 
RECENT DEVELOPMENTS
 
     On October 26, 1999, the Company changed its name from "EG&G, Inc." to
"PerkinElmer, Inc." The name change was approved at a Special Meeting of the
Stockholders held on September 10, 1999. The Company began trading as (NYSE:
PKI) effective October 26, 1999. On August 20, 1999, the Company sold the assets
of its Technical Services segment to an affiliate of the Carlyle Group LP for
approximately $250 million in cash and the assumption by the buyer of certain
liabilities of the Technical Services segment. On May 28, 1999, the Company
completed its acquisition of the Analytical Instruments Division of PE Corp. for
an aggregate purchase price of approximately $425 million, plus acquisition
costs.
 
OPERATING SEGMENTS
 
     Set forth below is a brief summary of each of the Company's four operating
segments (also referred to as "strategic business units" or "SBUs"; and within
those SBUs, strategic business enterprises referred to as "SBEs") together with
a description of certain of their more significant or recently introduced
products, services or operations.
 
  Life Sciences
 
     Our Life Sciences business unit helps solve the complex analytical problems
encountered in bio-screening and population screening laboratories by providing
chemical reagents, sample handling and measuring instruments, and computer
software. In 1999, this business unit had sales of $164 million, representing
12% of our total sales.
 
     Life Sciences comprises two SBEs: Bio-screening and Population Screening.
Within the field of bio-screening, Life Sciences focuses on customers engaged in
drug discovery and has established a strong presence in high throughput
screening (HTS) technologies. HTS involves the surveying of vast libraries of
chemicals to detect those that display a particular medicinal property.
Customers include the HTS laboratories of the world's major pharmaceutical
companies.
 
     In population screening, the subject of the screen is a human patient,
typically a large number of patients. For example, newborn babies can be
screened for signs of diseases that may be prevented through dietary change or
other intervention. Customers include public health authorities in the United
States as well as in many European countries.
 
     Principal Products.  The principal products of our Life Sciences business
unit include:
 
     - Multilabel counters and plate readers for rapid quantitative measurement
       of light signals;
 
     - Imaging systems to observe and measure cellular and molecular processes;
 
     - Sample handling and laboratory automation devices;
 
     - Chemical reagents to allow heterogeneous and homogeneous assays; and

<PAGE>   3
 
     - Information management software.
 
     New Products.  New product releases include:
 
     - The Viewlux(TM) plate reader, a new type of HTS instrument for drug
       discovery that facilitates higher throughputs by detecting signals from
       up to 1536 assays simultaneously.
 
     - A new version of the successful VICTOR(TM)multilabel counter, the
       VICTOR(2)V(TM), includes several new features requested by our customers
       in the pharmaceuticals industry.
 
     - On the diagnostics side, we have extended our product range with several
       new test kits and the Specimen Gate(TM) laboratory information management
       system. PerkinElmer Life Sciences is a Microsoft Certified Solution
       Provider, and this new product is the first of its type based on modern
       32-bit Microsoft tools.
 
     Brand Names.  Our Life Sciences business unit offers its products under
various brand names including Wallac(TM), Berthold(TM) and DELFIA(R).
 
  Optoelectronics
 
     Our Optoelectronics business unit produces a broad spectrum of
optoelectronic products, including high volume and high performance specialty
lighting sources, detectors, optical fiber communications components, imaging
devices, emitters and receivers, mux arrays, and large area amorphous silicon
detectors. In 1999, this business unit had sales of $413 million, representing
30% of our total sales.
 
     The Optoelectronics operations and sales organizations are aligned along
three SBEs: Lighting, Imaging and Telecom. Strong relationships exist with major
customers in each market including medical, analytical instrumentation,
telecommunications, consumer, entertainment, industrial and aerospace.
 
     Principal Products.  The principal products of our Optoelectronics business
unit include:
 
     - Lighting products such as photo flashlamps, and specialty high-intensity
       discharge (HID) lighting sources and fiber optic systems (xenon, mercury
       xenon, krypton-arc, metal halide) for medical diagnostics, dental curing
       and whitening, video projection, semiconductor lithography, stage and
       studio lighting, cinema projection lighting, solid-state laser pumping,
       tanning, signage, aerospace and other lighting applications;
 
     - Imaging products such as linear and two dimensional CCD sensors and
       cameras for the machine vision and analytical markets, amorphous silicon
       panels used in digital x-ray imaging and film replacement markets,
       photomultipliers for use in analytical instruments, and photocells and
       thermopiles used in gas and thermal monitoring applications;
 
     - Telecom and sensor components such as high speed Indium Gallium Arsenide
       (InGaAs) PIN photodiodes and avalanche photodiodes (APDs), InGaAs and APD
       hybrid microelectronic receiver modules, photodiode linear arrays, Dense
       Wavelength Division Multiplexer (DWDM) channel monitors, custom packaged
       laser diodes, Erbium Doped Fiber Amplifier (EDFA) pumps, and fiber optic
       component and cable test equipment. Other products include detectors and
       sensors for security systems and for climate and lighting controls.
 
     New Products.  New product releases include:
 
     - In the Telecom SBE, recent product releases include a 2.5 Gbit InGaAs APD
       and related APD receiver module and an InGaAs mux array for use in DWDM
       channel monitoring.
 
     - The Imaging SBE officially announced its new channel photomultiplier
       (CPM) product. This product was featured in several industry
       publications, including Laser Focus World, Sensors, EDN, and Photonics
       Spectra. In addition, our Amorphous Silicon division made the successful
       transition from development to production, shipping 41cm x 41cm digital
       x-ray detectors to GE Medical Systems.
 
                                        2

<PAGE>   4
 
     - In the Lighting SBE, record shipments in flashlamps were supported by Six
       Sigma(R) (see footnote below) quality for the new fourth generation
       design. Customer acceptance of the new Cermax(R) lighting system for
       dental curing was strong in 1999.
 
     Brand Names.  Our Optoelectronics business unit offers its products under
various brand names including Heimann(TM), ILC(R), ORC(TM), Reticon(R),
Vactec(TM), Wolfram(TM), Voltarc(R), Q-Arc(TM), Power Systems(TM) and Amorphous
Silicon(TM).
 
  Instruments
 
     Our Instruments business unit develops, manufactures and markets
sophisticated analytical instruments and imaging detection systems for research
laboratories, academia, medical institutions, government agencies and a wide
range of industrial applications designed to provide industry-specific "sample
to answer" solutions. In 1999, this business unit had sales of $607 million,
representing 45% of our total sales.
 
     The Instruments business unit has two SBEs: Analytical Instruments and
Detection Systems. Analytical Instruments provide world class analytical
solutions employing technologies such as molecular and atomic spectroscopies,
high pressure liquid chromatography (HPLC), gas chromatography (GC), and thermal
and elemental analysis. These instruments measure a range of substances from
biomolecules to organic and inorganic chemicals and have applications in the
pharmaceutical, food and beverage, chemical semiconductor and environmental
markets. Our Detection Systems SBE provides a broad range of products including
walk through weapons detection systems, advanced explosive detection systems,
and large cargo inspection systems. Typical applications are in the aviation,
transportation, government facilities, customs, and hazardous materials
detection markets.
 
     Principal Products.  The principal products of our Instruments business
unit include:
 
     - Analytical instruments used to accelerate the drug development process,
       decipher molecular mechanisms of drug actions, monitor and test for
       environmental pollutants, confirm nutritional content and safety of foods
       and beverages, and analyze the purity of raw materials used in the
       development of semiconductor and optical products.
 
     - Detection systems used to inspect cargo for weapons, explosives and
       contraband, hand-held and walk through metal detectors for security
       screening, and X-ray based technology to identify weapons, explosives or
       narcotics in hand carried or checked baggage.
 
     New Products.  Recent product releases include:
 
     - ELAN 6100 DRC spectrometer produced through a joint venture between the
       Company and Sciex, gives semiconductor manufacturers the ability to
       detect and measure critical elements at the parts per trillion and
       quadrillion levels, a capacity historically degraded by the interference
       from argon.
 
     - Turbomass Mass Spectrometer for the determination of volatile organic
       compounds (VOCs) and semi-volatile organic compounds.
 
     - TurboLC Plus System for Liquid Chromatography provides pharmaceutical
       companies the ability to quickly screen and identify combinatorial
       mixtures, as well as isolate and identify potential drug candidates for
       development.
 
     - HTS 7000 PLUS -- Bio Assay Reader provides a versatile, optimized
       spectroscopic measurement system for molecular biological research and
       drug development, useful in applications such as lead screening and
       therapeutic monitoring, and DNA analysis.
 
     - Spectrum One -- Fourier-transform Infrared (FT-IR) compact system
       provides major advancements in flexibility, and user-friendly technology
       for chemical analysis.
 
---------------
 
     Six Sigma(R) is a registered trademark of Motorola, Inc. All other
trademarks and registered trademarks referenced herein are owned by the Company
and its subsidiaries.
                                        3

<PAGE>   5
 
     - Linescan(R) V employs state-of-the art electronics and advanced features
       to improve the reliability of one of the industry's leading X-ray
       platforms.
 
     - TRX is the first TIP (or "Threat Image Projection") Ready X-ray system
       approved by the FAA for purchase and development at U.S. airports, and is
       a software-based system which allows security managers to consistently
       monitor the baggage screening process.
 
     Brand Names.  Our Instruments business unit offers its products under
various brand names including Astrophysics(TM), Vivid(R), Princeton Applied
Research(TM), ORTEC(R), Signal Recovery(TM) and Fiber Optics(TM).
 
  Fluid Sciences
 
     Our Fluid Sciences business unit produces static and dynamic seals, sealing
systems, solenoid valves, bellows devices, advanced pneumatic components,
systems and assemblies and sheet metal-formed products for market-leading
original equipment manufacturers and end users. In 1999, this business unit had
sales of $180 million, representing 13% of our total sales.
 
     Typical applications for the products of our Fluid Sciences business unit
are in the aerospace, semiconductor and power generation equipment markets as
well as lubricant and fuel testing.
 
     Principal Products.  The principal products of our Fluid Sciences business
unit include:
 
     - Welded metal bellows seals that hold the medication in patient pain
       reduction implants; welded metal bellows for wafer-process vacuum sealing
       and linear motion devices.
 
     - Valves that provide propulsion and directional control on satellites and
       actuation or control on aircraft.
 
     - Brush seals and flexible, metallic C- and E-Seals that reduce or
       eliminate emissions and improve efficiency and fuel consumption in power
       generation engines.
 
     - Aircraft engine dynamic and static sealing to enhance engine efficiency
       and reduce fuel consumption.
 
     - UHV/UHP static sealing in gas delivery and process chamber systems, and
       in laser and memory devices.
 
     - Engine and component durability testing, fuel and lubricant testing,
       vehicle fleet and fuel system testing.
 
     New Products.  New product releases include:
 
     - Alpha-C(R) and Beta-C(TM) Seals, a family of ultra-high vacuum seals
       developed for use in the increasingly harsh environment of semiconductor
       processing and vacuum equipment.
 
     - Micromechanical seals designed to be retrofitted into aircraft and other
       equipment.
 
     - Hydrodynamic seals developed for aircraft and accessory gearbox locations
       in order to reduce heat generation. The seals operate on a self-generated
       film of air, which extends seal life.
 
     - Air-breather valves that control gearbox pressure during aircraft climb.
       This product was developed at customer request and combines our bellows
       and valve technologies to replace a more expensive competing product.
 
     Brand Names.  Our Fluid Sciences business unit offers its products under
various brand names, including Pressure Science(TM), Wright Components(TM),
Belfab(R), Centurion(TM), Automotive Research(TM), and Missouri Metal
Shaping(TM).
 
  Discontinued Operations
 
     For a number of years, the Company had provided services under management
and operations contracts to the United States Department of Energy (the "DOE")
and reports its former DOE Support segment as discontinued operations. The last
of these DOE contracts expired in 1997. The Company is in the process of
 
                                        4

<PAGE>   6
 
negotiating contract closeouts and does not anticipate incurring any material
loss in connection with such contracts in excess of previously established
reserves.
 
     On August 20, 1999, the Company sold the assets of its Technical Services
segment, including the capital stock of EG&G Defense Materials, Inc., a
subsidiary of the Company, to EG&G Technical Services, Inc., an affiliate of The
Carlyle Group LP for approximately $250 million in cash and the assumption by
the buyer of certain liabilities of the Technical Services segment. Through its
Technical Services segment, the Company provided engineering, scientific,
management and technical support services to a broad range of governmental and
industrial customers. In 1999, Technical Services had sales of $303 million,
reported as discontinued operations.
 
MARKETING
 
     All four of the Company's business units, Life Sciences, Optoelectronics,
Instruments and Fluid Sciences, market their products and services through their
own specialized sales forces as well as independent foreign and domestic
manufacturer representatives and distributors. In certain foreign countries,
these operating segments have entered into joint venture and license agreements
with local firms to manufacture and market their products.
 
RAW MATERIALS AND SUPPLIES
 
     Raw materials and supplies used by the Company are generally readily
available in adequate quantities from domestic and foreign sources.
 
PATENTS AND TRADEMARKS
 
     While the Company's patents, trademarks and licenses in the aggregate are
important to its business, the Company does not believe that the loss of any one
patent, trademark or license or group of related patents, trademarks or licenses
would have a materially adverse effect on the overall business of the Company or
on any of its operating segments. The Company has both trademarks and registered
trademarks for a variety of its product names. Registration of the
PerkinElmer(TM) trademark is pending.
 
BACKLOG
 
     At January 2, 2000, the Company had a backlog in continuing operations of
approximately $400 million compared to $305 million at January 3, 1999. The
increase was primarily due to the acquisition of the Analytical Instruments
business from PE Corp. The Company includes in backlog only those orders for
which it has received a completed purchase order. The Company estimates that
more than 95% of its backlog as of January 2, 2000 will be billed during 2000.
Certain of these orders are subject to cancellation by the customer with payment
of a negotiated charge. Because of the possible changes in delivery schedules,
cancellation of orders and potential delays in product shipments, the Company's
backlog as of any particular date may not necessarily be representative of
actual sales for any succeeding period.
 
GOVERNMENT CONTRACTS
 
     Sales to U.S. government agencies, which were predominantly to the United
States Department of Defense and NASA in the former Technical Services segment,
which is reported as discontinued operations, were $326 million, $524 million
and $537 million in 1999, 1998 and 1997, respectively. Costs incurred under
cost-reimbursable contracts are subject to audit by the government. The results
of prior audits, which have been completed through 1995, have not had a material
effect on the Company.
 
COMPETITION
 
     Due to the variety of products and services offered by the Company, it
faces a wide range of competition and competitors. The Company in general,
however, faces strong competition in a number of markets. This affects its
ability to sell its products and services and the prices at which such products
and services are sold.
 
                                        5

<PAGE>   7
 
Competitors range from large organizations, both domestic and international,
that produce a comprehensive array of goods and services and may have greater
financial and other resources than the Company, to smaller organizations which
focus on specific market niches.
 
     In the Life Sciences segment, competition is on the basis of product
availability and reliability, and service level. Size of the competition ranges
from multinational organizations with a wide range of products to specialized
firms that in some cases have well established market niches. The Company
competes in these markets on the basis of innovative technologies, product
differentiation and quality. The proportion of large competitors in this segment
is expected to increase through the continued consolidation of competitors.
 
     In the Optoelectronics segment, no single competitor competes directly with
this segment across its full product range. However, the Company does compete
with specialized manufacturing companies in the manufacture and sale of
specialty flashtubes and lighting sources, certain photodetectors and
photodiodes, and switched power supplies. Competition is based on price,
technological innovation, operational efficiency and product reliability and
quality.
 
     In the Instruments segment, the Company faces a similar situation in that
no single competitor competes directly with this segment as a whole. The Company
competes with instrument companies that serve particular segments of markets in
nuclear and industrial instrumentation, and imaging detection systems. The
Company competes in this segment primarily on the basis of product performance,
product reliability, service and price.
 
     In the Fluid Sciences segment, competition is typically based on product
innovation, quality, service and price. In a few markets, competitors are large,
diversified engineering and manufacturing concerns. Most of the Company's
competitors, however, are small specialized manufacturing companies offering
fewer product lines for narrower market segments. Competition for lubricant
testing services is from a few specialized testing companies and some
customer-owned laboratories, and is mainly based on quality and price.
 
     Within all operating segments of the Company, competition for governmental
purchases of both products and services is subject to mandated procurement
procedures and competitive bidding practices. The Company competes primarily on
the basis of product performance, technological innovation, service and price.
 
RESEARCH AND DEVELOPMENT
 
     During 1999, 1998 and 1997, Company-sponsored research and development
expenditures were approximately $71 million, $46 million and $45 million,
respectively. These expenditures were incurred primarily in the Company's Life
Sciences, Instruments and Optoelectronics operating segments.
 
ENVIRONMENTAL COMPLIANCE
 
     The Company is conducting a number of environmental investigations and
remedial actions at current and former Company locations and, along with other
companies, has been named a potentially responsible party (PRP) for certain
waste disposal sites. The Company accrues for environmental issues in the
accounting period that the Company's responsibility is established and when the
cost can be reasonably estimated. The Company has accrued $12.3 million as of
January 2, 2000, representing management's estimate of the total cost of
ultimate disposition of known environmental matters. Such amount is not
discounted and does not reflect any recovery of any amounts through insurance or
indemnification arrangements. These cost estimates are subject to a number of
variables, including the stage of the environmental investigations, the
magnitude of the possible contamination, the nature of the potential remedies,
possible joint and several liability, the timeframe over which remediation may
occur and the possible effects of changing laws and regulations. For sites where
the Company has been named a PRP, management does not currently anticipate any
additional liability to result from the inability of other significant named
parties to contribute. The Company expects that such accrued amounts could be
paid out over a period of up to five years. As assessments and remediation
activities progress at each individual site, these liabilities are reviewed and
adjusted to reflect additional information as it becomes available. There have
been no environmental problems to date that have had or are expected to have a
material effect on the Company's financial position or results of operations.
While it is
 
                                        6

<PAGE>   8
 
reasonably possible that a material loss exceeding the amounts recorded may have
been incurred, the preliminary stages of the investigations make it impossible
for the Company to reasonably estimate the range of potential exposure.
 
EMPLOYEES
 
     As of March 1, 2000, the Company employed approximately 12,000 persons.
Certain of the Company's subsidiaries are parties to contracts with labor
unions. The Company considers its relations with employees to be satisfactory.
 
FINANCIAL INFORMATION ABOUT OPERATING SEGMENTS
 
     Sales and operating profit by segment for the three years ended January 2,
2000 are shown in the table below:
 

<TABLE>
<CAPTION>
                  (IN THOUSANDS)                       1999         1998        1997
                  --------------                    ----------    --------    --------
<S>                                                 <C>           <C>         <C>
LIFE SCIENCES
Sales.............................................  $  163,587    $148,124    $125,380
Operating Profit..................................      15,453       9,046      10,108
OPTOELECTRONICS
Sales.............................................     412,592     268,558     261,291
Operating Profit (Loss)...........................      34,934      (5,454)    (23,128)
INSTRUMENTS
Sales.............................................     607,281     247,388     236,839
Operating Profit (Loss)...........................      (9,351)      6,659      17,966
FLUID SCIENCES
Sales.............................................     179,669     167,646     127,087
Operating Profit..................................      22,204       5,194       8,846
OTHER
Sales.............................................          --      22,666     176,885
Operating Profit..................................       3,412     104,279      13,227
CONTINUING OPERATIONS
Sales.............................................   1,363,129     854,382     927,482
Operating Profit..................................      66,652     119,724      27,019
</TABLE>

 
     The Company's Technical Services segment and former Department of Energy
segment are presented as discontinued operations and, therefore, are not
included in the preceding table. The results for the periods presented included
certain nonrecurring items which are discussed in the Management's Discussion
and Analysis section of this document.
 
     Additional information relating to the Company's operating segments is as
follows:
 

<TABLE>
<CAPTION>
                                       DEPRECIATION AND
                                     AMORTIZATION EXPENSE             CAPITAL EXPENDITURES
                                 -----------------------------    -----------------------------
        (IN THOUSANDS)            1999       1998       1997       1999       1998       1997
        --------------           -------    -------    -------    -------    -------    -------
<S>                              <C>        <C>        <C>        <C>        <C>        <C>
Life Sciences..................  $ 6,189    $ 5,059    $ 4,091    $ 7,465    $ 5,415    $ 3,352
Optoelectronics................   34,430     25,615     19,528     21,155     17,256     21,312
Instruments....................   17,292     10,573     11,688      6,555      8,382      7,616
Fluid Sciences.................    7,093      6,042      3,090      4,515     10,325      9,488
Other..........................    1,111      1,221      4,301      1,402      3,111      5,874
                                 -------    -------    -------    -------    -------    -------
  Continuing operations........  $66,115    $48,510    $42,698    $41,092    $44,489    $47,642
                                 =======    =======    =======    =======    =======    =======
  Discontinued operations......  $   841    $ 1,869    $ 1,914    $ 1,341    $ 2,033    $ 1,087
                                 =======    =======    =======    =======    =======    =======
</TABLE>

 
                                        7

<PAGE>   9
 

<TABLE>
<CAPTION>
                                                                    TOTAL ASSETS
                                                              ------------------------
                       (IN THOUSANDS)                            1999          1998
                       --------------                         ----------    ----------
<S>                                                           <C>           <C>
Life Sciences...............................................  $  125,025    $  128,970
Optoelectronics.............................................     448,453       479,818
Instruments.................................................     854,452       183,590
Fluid Sciences..............................................     102,421       112,898
Other.......................................................     184,289       233,502
                                                              ----------    ----------
                                                              $1,714,640    $1,138,778
                                                              ==========    ==========
</TABLE>

 
     Other total assets consisted primarily of cash and cash equivalents,
prepaid pension, prepaid taxes and, in 1998, net assets of discontinued
operations.
 
FINANCIAL INFORMATION ABOUT GEOGRAPHIC AREAS
 
     The following geographic area information for continuing operations
includes sales based on location of external customer and net property, plant
and equipment based on physical location:
 

<TABLE>
<CAPTION>
                                                                  SALES
                                                    ----------------------------------
                  (IN THOUSANDS)                       1999         1998        1997
                  --------------                    ----------    --------    --------
<S>                                                 <C>           <C>         <C>
U.S...............................................  $  661,609    $447,793    $512,503
Germany...........................................      98,787      67,647      71,390
Japan.............................................      73,567      28,306      21,630
United Kingdom....................................      71,493      47,794      65,462
Italy.............................................      56,433      17,565      19,204
France............................................      50,282      35,329      44,417
Other Non-U.S.....................................     350,958     209,948     192,876
                                                    ----------    --------    --------
                                                    $1,363,129    $854,382    $927,482
                                                    ==========    ========    ========
</TABLE>

 

<TABLE>
<CAPTION>
                                                                NET PROPERTY, PLANT AND
                                                                       EQUIPMENT
                                                                ------------------------
                       (IN THOUSANDS)                              1999          1998
                       --------------                           ----------    ----------
<S>                                                             <C>           <C>
U.S.........................................................     $133,812      $133,550
Germany.....................................................       21,570        21,923
Finland.....................................................       17,277        15,431
Canada......................................................       14,718         8,861
United Kingdom..............................................       13,282         3,453
Other Non-U.S...............................................       27,375        35,462
                                                                 --------      --------
                                                                 $228,034      $218,680
                                                                 ========      ========
</TABLE>

 
     Effectively all of the sales and net property, plant and equipment of the
discontinued operations (consisting of the Technical Services segment and former
DOE segment) were U.S. based.
 

I
TEM 2.  PROPERTIES
 
     As of March 1, 2000, the Company occupied approximately 4,048,400 square
feet of building area, of which approximately 1,889,400 square feet is owned by
the Company. The balance is leased. The Company's headquarters occupies 53,350
square feet of leased space in Wellesley, Massachusetts. The Company's other
operations are conducted in manufacturing and assembly plants, research
laboratories, administrative offices and other facilities located in 14 states
and 41 foreign countries.
 
     Non-U.S. facilities account for approximately 1,760,900 square feet of
owned and leased property, or approximately 43% of the Company's total occupied
space.
 
     The Company's leases on property are both short-term and long-term. In
management's opinion, the Company's properties are well-maintained and are
adequate for its present requirements.
 
                                        8

<PAGE>   10
 
     Substantially all of the machinery and equipment used by the Company is
owned by the Company and the balance is leased or furnished by contractors or
customers.
 
     The following table indicates the approximate square footage of real
property owned and leased attributable to each of the Company's industry
segments.
 

<TABLE>
<CAPTION>
                                                              OWNED         LEASED        TOTAL
                                                            (SQ. FEET)    (SQ. FEET)    (SQ. FEET)
                                                            ----------    ----------    ----------
<S>                                                         <C>           <C>           <C>
Life Sciences.............................................    241,600       142,300       383,900
Optoelectronics...........................................    689,100       743,100     1,432,200
Instruments...............................................    649,200     1,133,500     1,782,700
Fluid Sciences............................................    305,000        86,700       391,700
Corporate Offices.........................................      4,600        53,400        57,900
                                                            ---------     ---------     ---------
CONTINUING OPERATIONS.....................................  1,889,500     2,159,000     4,048,400
                                                            =========     =========     =========
</TABLE>

 

ITEM 3.  LEGAL PROCEEDINGS
 
     The Company is subject to various claims, legal proceedings and
investigations covering a wide range of matters that arise in the ordinary
course of its business activities. Each of these matters is subject to various
uncertainties, and it is possible that some of these matters may be resolved
unfavorably to the Company. The Company has established accruals for matters
that are probable and reasonably estimable. Management believes that any
liability that may ultimately result from the resolution of these matters in
excess of amounts provided will not have a material adverse effect on the
financial position or results of operations of the Company.
 
     The Company has received notices from the Internal Revenue Service (IRS)
asserting deficiencies in federal corporate income taxes for the Company's 1985
to 1994 tax years. The total additional tax proposed by the IRS amounts to $74
million plus interest. The Company has filed petitions in the United States Tax
Court to challenge most of the deficiencies asserted by the IRS. The Company
believes that it has meritorious legal defenses to those deficiencies and
believes that the ultimate outcome of the case will not result in a material
impact on the Company's consolidated results of operations or financial
position.
 
     The Company and its subsidiary, EG&G Idaho, Inc., have been named as
defendants in a lawsuit filed in the United States District Court for the
District of Idaho and served in November 1998. The suit was filed under the
Civil False Claims Act by two former employees of EG&G Idaho, and names as
defendants six entities which were formerly, or currently are, prime or
subcontractors to the Department of Energy at the Idaho National Engineering and
Environmental Laboratory. The central allegation of the suit is that the
defendants submitted false claims to the government for reimbursement of
environmental activities which they knew or should have known had been performed
improperly or not at all. The damages claimed have not been quantified by the
plaintiffs. In November 1999, the Court granted the defendants' motion to
dismiss the case under Rule 9(b) of the Federal Rules of Civil Procedure. A
restated complaint was filed by the plaintiffs in March 2000, which is currently
being reviewed by counsel for the Company. In January 2000, the Company and
three other companies were named as defendants in a civil false claim action
filed in the United States District Court for the District of Colorado involving
security issues at the Department of Energy's Rocky Flats Plant. In March 2000,
the Company filed motions to dismiss the case under Rules 9(b) and 12(b)(6) of
the Federal Rules of Civil Procedure. Plaintiff's response is due in April 2000.
The Company intends to defend itself vigorously in these matters and believes
that their ultimate disposition will not have a material impact on the Company's
consolidated results of operations or financial position.
 

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
 
     Not applicable.
 
                                        9

<PAGE>   11
 
EXECUTIVE OFFICERS OF THE REGISTRANT
 
     Listed below are the executive officers of the Company as of March 1, 2000.
No family relationship exists between any of the officers.
 

<TABLE>
<CAPTION>
NAME                                                 POSITION                                      AGE
----                                                 --------                                      ---
<S>                                                  <C>                                           <C>
Gregory L. Summe...................................  Chairman of the Board,                        43
                                                     Chief Executive Officer and President
Robert F. Friel....................................  Senior Vice President                         44
                                                     and Chief Financial Officer
Terrance L. Carlson................................  Senior Vice President,                        47
                                                     General Counsel and Clerk
Angelo D. Castellana...............................  Senior Vice President                         58
Richard F. Walsh...................................  Senior Vice President                         47
Robert A. Barrett..................................  Senior Vice President                         56
Patrik Dahlen......................................  Senior Vice President                         38
John J. Engel......................................  Senior Vice President                         38
Robert J. Rosenthal................................  Senior Vice President                         43
Gregory D. Perry...................................  Vice President, Control and Treasury          39
</TABLE>

 
     Mr. Summe joined the Company in 1998 as President and Chief Operating
Officer, was elected President and Chief Executive Officer in December 1999, and
Chairman of the Board in April 1999. Until late 1997, he was President of
AlliedSignal's Automotive Products Group. AlliedSignal, Inc., which recently
merged with Honeywell and became known as Honeywell International, is a $24
billion multi-product company, which has operations in aerospace, automotive and
engineered materials businesses. Prior to being appointed President of
AlliedSignal's Automotive Products Group in 1997, Mr. Summe served as President
of AlliedSignal's Aerospace Engines from 1995 to 1997 and as President of
AlliedSignal's General Aviation Avionics from 1993 to 1995.
 
     Mr. Friel joined the Company in February 1999 as Senior Vice President and
Chief Financial Officer. From 1997 to 1999 he was Corporate Vice President and
Treasurer of AlliedSignal, Inc., which is described above. Prior to that he was
Vice President, Finance and Administration of AlliedSignal Engines from 1992 to
1996.
 
     Mr. Carlson joined the Company in June 1999 as Senior Vice President,
General Counsel and Clerk. From 1997 to 1999 he was Deputy General Counsel of
AlliedSignal, Inc. Prior to that he was Vice President and General Counsel of
AlliedSignal Aerospace from 1994 to 1997, and from 1986 to 1994 he was a partner
in the law firm of Gibson, Dunn & Crutcher.
 
     Mr. Castellana joined the Company in 1965. He was elected a Vice President
in 1991 and a Senior Vice President in 1997 and serves as a principal executive
in the Office of the Chief Executive Officer, overseeing productivity
improvements and sourcing, and special assignments.
 
     Mr. Walsh joined the Company in July 1998 as Senior Vice President of Human
Resources. From 1989 to 1998, he served as Senior Vice President of Human
Resources of ABB Americas, Inc., the U.S. based subsidiary of an international
engineering company.
 
     Mr. Barrett was elected a Vice President of the Company in January 1997 and
a Senior Vice President in January 2000. He has served as President of the Fluid
Sciences Strategic Business Unit since May 1998. From 1990 to 1997, he served as
President and General Manager of the Company's Pressure Science division.
 
     Mr. Dahlen was elected a Vice President of the Company in October 1999 and
a Senior Vice President in January 2000. He has served as President of the Life
Sciences Strategic Business Unit since September 1999. From April through
October 1999, Mr. Dahlen was General Manager of the Reticon division of the
 
                                       10

<PAGE>   12
 
Optoelectronics Strategic Business Unit. From September 1995 through April 1999
Mr. Dahlen was Director of Marketing and General Manager of US Diagnostics for
the Life Sciences Strategic Business Unit. Mr. Dahlen had been Marketing Manager
of Wallac Oy, a subsidiary of the Company, from February 1995 until September
1995. During 1994 he was Director, Diagnostic Systems at Wallac Oy. Mr. Dahlen
is a citizen of Finland.
 
     Mr. Engel was elected a Vice President of the Company in April 1999 and a
Senior Vice President in January 2000. He has served as President of the
Optoelectronics Strategic Business Unit since March 1999. Mr. Engel had been
associated with AlliedSignal since 1994, serving as Vice President and General
Manager of Business and General Aviation from 1997 to March 1999, Vice President
of the Flight Controls Enterprise in 1996, and Director of the Radar and
Collision Avoidance Enterprise from 1994 to 1995.
 
     Dr. Rosenthal was elected a Vice President of the Company in April 1999 and
a Senior Vice President in January 2000. He has served as President of the
Instruments Strategic Business Unit since March 1999. Dr. Rosenthal had been
President and Chief Executive Officer of Thermo Optek Corporation since January
1998. Thermo Optek Corporation is an analytical instrumentation company focusing
on energy and light measurement, and is a subsidiary of Thermo Electron. Dr.
Rosenthal became a Senior Vice President of Thermo Optek in August 1996,
Executive Vice President and Chief Operating Officer in November 1996, and
President and Chief Operating Officer in April 1997. Prior to that, Dr.
Rosenthal was President of Nicolet Instrument Corporation since 1993.
 
     Mr. Perry joined the Company in September 1998 as Controller, and was
elected Vice President, Control and Treasury in 1999. From 1997 to 1998, he
served as Chief Financial Officer of AlliedSignal's Automotive Products Group
and as Chief Financial Officer of AlliedSignal's Fram and Autolite Units. Prior
to 1997, he served as Vice President, Finance of GE Medical Systems Europe from
1994 to 1997, and served as Manager in charge of business development for GE
Motors from 1991 to 1994.
 
                                       11

<PAGE>   13
 

                                    PART II
 

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
 
MARKET PRICE OF COMMON STOCK
 

<TABLE>
<CAPTION>
                                                                     1998 QUARTERS
                                                          ------------------------------------
                                                          FIRST     SECOND    THIRD     FOURTH
                                                          ------    ------    ------    ------
<S>                                                       <C>       <C>       <C>       <C>
High....................................................  $28.50    $33.75    $30.13    $29.44
Low.....................................................   19.44     27.13     18.88     20.50
</TABLE>

 

<TABLE>
<CAPTION>
                                                                     1999 QUARTERS
                                                          ------------------------------------
                                                          FIRST     SECOND    THIRD     FOURTH
                                                          ------    ------    ------    ------
<S>                                                       <C>       <C>       <C>       <C>
High....................................................  $30.19    $36.25    $39.94    $45.00
Low.....................................................   25.50     26.50     31.50     36.63
</TABLE>

 
DIVIDENDS
 

<TABLE>
<CAPTION>
                                                                        1998 QUARTERS
                                                              ----------------------------------
                                                              FIRST    SECOND    THIRD    FOURTH
                                                              -----    ------    -----    ------
<S>                                                           <C>      <C>       <C>      <C>
Cash Dividends Per Common Share.............................  $.14      $.14     $.14      $.14
</TABLE>

 

<TABLE>
<CAPTION>
                                                                        1999 QUARTERS
                                                              ----------------------------------
                                                              FIRST    SECOND    THIRD    FOURTH
                                                              -----    ------    -----    ------
<S>                                                           <C>      <C>       <C>      <C>
Cash Dividends Per Common Share.............................  $.14      $.14     $.14      $.14
</TABLE>

 
     The Company's common stock is listed and traded on the New York Stock
Exchange. The number of holders of record of the Company's common stock as of
February 25, 2000, was approximately 9,000.
 
     In October 1999, the Board of Directors of the Company declared a regular
quarterly cash dividend of fourteen cents per share of common stock. The
quarterly cash dividend was paid on February 10, 2000, to stockholders of record
at the close of business on January 21, 2000.
 
                                       12

<PAGE>   14
 

ITEM 6.  SELECTED FINANCIAL DATA
 
                         SELECTED FINANCIAL INFORMATION
                    FOR THE FIVE YEARS ENDED JANUARY 2, 2000
 

<TABLE>
<CAPTION>
    (IN THOUSANDS WHERE APPLICABLE)          1999             1998            1997          1996        1995
    -------------------------------       ----------       ----------       --------      --------    --------
<S>                                       <C>              <C>              <C>           <C>         <C>
OPERATIONS:
Sales...................................  $1,363,129       $  854,382       $927,482      $928,287    $887,313
Operating income from continuing
  operations............................      66,652(1)       119,724(5)      27,019(9)     56,265      50,628
Income from continuing operations.......      28,371(2)        79,001(6)       9,562(10)    34,264      33,340
Income from discontinued operations, net
  of income taxes.......................      15,665           23,001(7)      24,130        25,892      34,700
Gain on disposition of discontinued
  operations, net of income taxes.......     110,280(3)            --             --            --          --
Net income..............................     154,316(2)(3)    102,002(6)(7)   33,692(10)    60,156      68,040
Basic earnings per share:
  Continuing operations.................         .62(2)          1.74(6)         .21(10)       .72         .64
  Discontinued operations...............        2.77(3)           .51(7)         .53           .55         .68
  Net income............................        3.39(2)(3)       2.25(6)(7)      .74(10)      1.27        1.32
Diluted earnings per share:
  Continuing operations.................         .61(2)          1.72(6)         .21(10)       .72         .64
  Discontinued operations...............        2.70(3)           .50(7)         .53           .55         .68
  Net income............................        3.31(2)(3)       2.22(6)(7)      .74(10)      1.27        1.32
Weighted-average common shares
  outstanding:
  Basic.................................      45,522           45,322         45,757        47,298      51,483
  Diluted...............................      46,569           45,884         45,898        47,472      51,573
Return on equity........................        32.5%(4)         28.0%(8)        9.7%(11)     16.4%       16.8%
FINANCIAL POSITION:
Total assets............................  $1,714,640       $1,138,778       $777,737      $774,761    $757,927
Short-term debt.........................     382,162          157,888         46,167        21,499       5,275
Long-term debt..........................     114,855          129,835        114,863       115,104     115,222
Long-term liabilities...................     196,511          124,799         95,940        76,087      63,816
Stockholders' equity....................     550,776          399,667        328,388       365,106     366,946
Total debt/total capital................          47%              42%            33%           27%         25%
Common shares outstanding...............      46,366           44,746         45,333        46,309      47,610
CASH FLOWS:
Cash flows from continuing operations...  $  108,768       $   40,853       $ 11,405      $ 48,291    $ 80,868
Cash flows from discontinued
  operations............................       7,061           28,702         23,433        31,867      69,297
Cash flows from operating activities....     115,829           69,555         34,838        80,158     150,165
Depreciation and amortization...........      66,115           48,510         42,698        38,861      37,432
Capital expenditures....................      41,092           44,489         47,642        78,796      60,689
Purchases of common stock...............         970           41,217         28,104        30,760     135,079
Cash dividends per common share.........         .56              .56            .56           .56         .56
</TABLE>

 
---------------
 (1) Operating income from continuing operations included net nonrecurring
     expense items totaling $52.1 million pre-tax.
 
 (2) Income from continuing operations included the items in (1) above, plus net
     nonrecurring other income items totaling $3.5 million pre-tax. The net
     nonrecurring items, which are discussed in the notes to the consolidated
     financial statements and the Management's Discussion and Analysis sections
     of this document, totaled $35.2 million after-tax ($.77 basic, $.76 diluted
     loss per share).
 
 (3) Discontinued operations included a $181 million nonrecurring pre-tax gain
     on disposition, $110 million after-tax ($2.42 basic, $2.37 diluted earnings
     per share).
 
                                       13

<PAGE>   15
 
 (4) Return on equity before effects of nonrecurring items was 18.1%.
 
 (5) Operating income from continuing operations included net nonrecurring
     income items totaling $62.5 million pre-tax.
 
 (6) Income from continuing operations included the items in (5) above, plus a
     $4.3 million pre-tax investment gain. The net nonrecurring items, which are
     discussed in the notes to the consolidated financial statements and the

     Management's Discussion and Analysis sections of this document, totaled
     $44.7 million after-tax ($.99 basic, $.97 diluted earnings per share).
 
 (7) Discontinued operations included nonrecurring expense items related to
     restructuring and other charges totaling $6.8 million pre-tax, $4.1 million
     after-tax ($.09 basic and diluted loss per share).
 
 (8) Return on equity before effects of nonrecurring items was 17.9%.
 
 (9) Operating income from continuing operations included an asset impairment
     charge of $28.2 million pre-tax.
 
(10) Income from continuing operations included the item in (9) above, plus a
     $3.4 million pre-tax cost of capital reimbursement. The net nonrecurring
     items, which are discussed in the notes to the consolidated financial
     statements and Management's Discussion and Analysis sections of this
     document, totaled $21.2 million after-tax ($.46 basic and diluted loss per
     share).
 
(11) Return on equity before effects of nonrecurring items was 15.4%.
 
                                       14

<PAGE>   16
 

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
 
OVERVIEW
 
     During 1999, the Company accelerated its transformation towards becoming a
high-technology global leader. In addition to significantly improving the
operating performance of the Company during 1999, several acquisitions and
divestitures were concluded which have shifted the portfolio of businesses to
higher growth potential including:
 
     - acquisition of the Analytical Instruments business from PE Corp.
 
     - divestiture of government services business
 
     - divestiture of structural kinematics business
 
     These transactions resulted in gains from the divestitures and
acquisition-related charges. In addition, the Company's continued restructuring
efforts during 1999 resulted in certain one-time items. The table presented
below reconciles the reported results of the Company in the accompanying
financial statements to the financial results before these nonrecurring items.
On this adjusted basis (which includes results of discontinued operations
through the date of divestiture), EPS expanded 27% during 1999 to $1.70 versus
$1.34 in 1998. Excluding results of discontinued operations, 1999 adjusted EPS
was $1.36 versus $.75 in 1998, representing an 81% increase.
 

<TABLE>
<CAPTION>
                                                               1999      1998
                                                              ------    ------
<S>                                                           <C>       <C>
Diluted EPS, as reported....................................  $ 3.31    $ 2.22
Gains on dispositions.......................................   (2.63)    (1.91)
Acquisition-related charges.................................     .51       .05
Restructuring and other one-time items......................     .51       .98
                                                              ------    ------
"Adjusted" EPS..............................................  $ 1.70    $ 1.34
                                                              ======    ======
</TABLE>

 
DISCUSSION OF CONSOLIDATED RESULTS OF OPERATIONS -- 1999 COMPARED TO 1998
 
     Over the past two years, the mix of the Company's consolidated revenues
from continuing operations has changed significantly, which resulted in reported
sales from continuing operations of $1,363 million in 1999 versus $854 million
in 1998, representing a 60% increase. Organic growth for 1999 totaled 8%, which
the Company defines as growth in historical businesses plus growth in acquired
businesses assuming they were owned in prior periods, reduced for the effects of
exited businesses and foreign exchange. Revenues by segment during 1999 versus
1998 are discussed in further detail below under the caption "Segment Results of
Operations."
 
     Due to the number of changes in the portfolio of businesses, the table
presented below reconciles reported operating profit from continuing operations
to operating profit before nonrecurring items.
 

<TABLE>
<CAPTION>
                                                                     PRE-TAX
                                                                OPERATING INCOME
                                                              ---------------------
(IN THOUSANDS)                                                  1999        1998
--------------                                                --------    ---------
<S>                                                           <C>         <C>
As reported.................................................  $ 66,652    $ 119,724
Gains on dispositions.......................................   (17,750)    (125,822)
Acquisition-related charges.................................    32,857        2,300
Restructuring charges and other one-time items, net.........    36,948       61,027
                                                              --------    ---------
Adjusted operating profit...................................  $118,707    $  57,229
                                                              ========    =========
</TABLE>

 
     Adjusted operating income before nonrecurring items was $118.7 million for
1999 versus $57.2 million in 1998, representing an increase of $61.5 million, or
107%, during 1999 compared to 1998. On an adjusted basis, operating margin
increased 200 basis points to 8.7% of consolidated sales for 1999 versus 1998
operating
 
                                       15

<PAGE>   17
 
margin of 6.7%. The increase in operating profit during 1999 was due to higher
revenues discussed above, the benefits from restructuring activities and Six
Sigma productivity initiatives, and the changes in the portfolio of businesses
as the acquired businesses have higher margins than those divested.
 
SEGMENT RESULTS OF OPERATIONS
 
     The Company's businesses are reported as four segments, reflecting the
Company's management methodology and structure. The Company's Technical Services
segment has been classified as discontinued operations due to its divestiture
during 1999. The accounting policies of the segments are the same as those
described in the footnotes to the accompanying consolidated financial
statements. The Company evaluates performance based on operating profit of the
respective segments. The discussion that follows is a summary analysis of the
primary changes in operating results by segment for 1999 versus 1998 and 1998
versus 1997.
 
  Life Sciences
 
     1999 Compared to 1998
 
     Sales of $163.6 million for 1999 increased $15.5 million versus 1998.
Adjusting for the impact of the stronger dollar, revenue growth during 1999 was
17%. Higher volumes from continued strength in the high throughput screening and
genetic disease screening markets, and revenues from new products were the
primary contributors to this increase during 1999.
 
     Reported operating profit was $15.5 million during 1999 versus $9 million
in 1998, representing an increase of $6.5 million, or 72%. 1999 operating profit
included net restructuring charges of $5.8 million. Excluding nonrecurring items
in 1999 and 1998, operating profit increased $7.6 million during 1999 to $21.3
million representing a 55% increase versus 1998. Higher sales discussed above
and increased gross margins across most businesses, driven primarily by
higher-margin new products sold in 1999, were the primary contributors for the
overall 1999 increase compared to 1998.
 
     1998 Compared to 1997
 
     Sales for 1998 were $148.1 million compared to $125.4 million for 1997,
which represented a $22.7 million, or 18%, increase. Higher sales volumes from
certain base businesses, revenues from recently developed products and the
Isolab acquisition revenues of $6.5 million were the primary reasons for the
increase during 1998. The higher volumes during 1998 primarily related to the
high throughput screening and genetic disease screening businesses.
 
     Reported operating profit for 1998 was $9 million compared to $10.1 million
for 1997, which represents a $1.1 million, or 11%, decrease. Restructuring
charges of $4.6 million recorded in the first half of fiscal 1998 contributed to
this decrease. 1998 base operating profit was $13.6 million compared to $10.3
million for 1997, which represented a $3.3 million, or 32%, increase. The
increase was due primarily to the higher revenues discussed above and improved
gross margins from most businesses resulting from higher sales of higher margin
products and continued improvements in quality.
 
  Optoelectronics
 
     1999 Compared to 1998
 
     Sales for 1999 were $412.6 million, compared to 1998 sales of $268.6
million, representing an increase of $144 million, or 54%. Revenue from the
acquired specialty lighting business and strong organic growth was partially
offset by softness in the sensors business and exited businesses.
 
     Reported operating profit for 1999 was $34.9 million versus an operating
loss of $5.5 million in 1998. The 1999 operating income included net
restructuring charges of $5.5 million and an asset impairment charge of $3
million. Excluding nonrecurring items, operating profit in 1999 and 1998 was
$43.4 million and $17.1 million, respectively, representing an increase of $26.3
million, or 154%. The 1999 increase was primarily due to higher revenues
discussed above, higher margin new products, the exiting from unprofitable
businesses and the shift by the Company to lower cost manufacturing areas.
 
                                       16

<PAGE>   18
 
     1998 Compared to 1997
 
     Sales for 1998 were $268.6 million compared to $261.3 million for 1997,
which represents a $7.3 million, or 3%, increase. Slight increases in sales
across most businesses were partially offset by lower 1998 printer circuit board
assembly sales versus 1997.
 
     Reported operating loss for 1998 was $5.5 million compared to a loss of
$23.1 million for 1997 which represents an increase of $17.6 million, or 76%.
Restructuring charges of $20.3 million were recorded in the first half of fiscal
1998 and a fourth quarter charge of $2.3 million was recorded for an in-process
research and development charge related to the Lumen acquisition; each
contributed to the 1998 operating loss. 1998 base operating profit was $17.1
million compared to $5.3 million for 1997, which represented an $11.8 million,
or 223%, increase. Higher gross margins across most businesses, favorable
product mix, and various operational improvement initiatives to lower production
costs were the primary contributors to this increase.
 
  Instruments
 
     1999 Compared to 1998
 
     Sales for 1999 and 1998 were $607.3 million and $247.4 million,
respectively, increasing $359.9 million, or 145%, during 1999 compared to 1998.
1999 revenues from acquisitions and higher security revenues during 1999 offset
the effects of divestitures and lower revenues in certain base businesses,
primarily automotive, compared to 1998.
 
     PEAI acquisition purchase accounting charges and certain nonrecurring items
during 1999 contributed to a reported operating loss of $9.4 million versus
operating income of $6.7 million in 1998. The 1999 operating loss included the
following: $23 million charge related to acquired in-process research and
development; a $9.9 million charge related to the revaluation of acquired
inventory; net restructuring charges of $1.4 million; an asset impairment charge
of $15 million and other repositioning costs of $4.4 million. Excluding
nonrecurring items in 1999 and 1998, operating profit in 1999 increased $19
million, or 75%, to $44.3 million compared to 1998. Operating profit from the
acquired PEAI and Lumen photolithography businesses were partially offset by the
effects of depressed market conditions in the security and automotive businesses
during most of 1999.
 
     1998 Compared to 1997
 
     Sales for 1998 were $247.4 million compared to $236.8 million for 1997,
which represented a $10.6 million, or 4%, increase. This was due primarily to
the effects of a $4.5 million increase in automotive business revenues and $4
million of royalty and licensing fees. These increases were partially offset by
a 6% decrease in 1998 X-ray revenues due to an overall softening in the security
markets.
 
     Reported operating profit for 1998 was $6.7 million compared to $18 million
for 1997, which represents a decrease of $11.3 million, or 63%. Restructuring
charges of $11.3 million and an asset impairment charge of $7.4 million were
recorded in the first half of 1998 and contributed to this decrease. 1998 base
operating profit was $25.3 million compared to $20.6 million for 1997, which
represents a $4.7 million, or 23%, increase. Base operating income in 1998
increased versus 1997 due primarily to the royalty and licensing fees, which
contributed $3.1 million to operating income, and a $2 million refund of sales
and use taxes which were offset in part by customer contract provisions.
 
  Fluid Sciences
 
     1999 Compared to 1998
 
     During the third quarter of 1999, the Company's business segment previously
referred to as Engineered Products was renamed Fluid Sciences.
 
     Sales for 1999 were $179.7 million compared to $167.6 million in 1998,
representing a $12.1 million, or 7%, increase. Recovery in the semiconductor
industry and continued growth in the power generation businesses offset
continued weakness in the aerospace markets and the absence of revenues from
businesses exited by the Company during 1998, primarily certain sheetmetal
fabrication operations.
 
                                       17

<PAGE>   19
 
     Reported 1999 operating profit increased $17 million, or 327%, to $22.2
million compared to $5.2 million in 1998. The 1999 operating income included a
net restructuring credit of $2.2 million discussed more fully in the
Restructuring Charges section herein. Excluding 1999 and 1998 nonrecurring
items, 1999 operating profit was $20 million versus $15.7 million in 1998,
representing an increase of $4.3 million, or 27%. Higher sales discussed above
and higher gross margins due to Six Sigma and restructuring initiatives were the
primary factors contributing to the increase in 1999 versus 1998.
 
     1998 Compared to 1997
 
     Sales for 1998 were $167.6 million compared to $127.1 million for 1997,
which represents a $40.5 million, or 32%, increase. Modest strength in the
Company's aerospace business partially contributed to the increase and was
offset in part by market softness which affected the semiconductor business. The
Belfab acquisition completed in the second quarter of 1998 contributed $17.2
million while most other segment businesses recorded higher 1998 sales compared
to 1997. Excluding the acquisition, revenues in 1998 increased approximately 18%
compared to 1997.
 
     Reported operating profit for 1998 was $5.2 million compared to $8.8
million for 1997, which represented a decrease of $3.6 million, or 41%.
Restructuring charges of $9.9 million recorded in the first half of 1998 and
$0.6 million of integration costs recorded in the third quarter of 1998
contributed to this decrease. 1998 base operating profit was $15.7 million
compared to $9.3 million for 1997, which represented an increase of $6.4
million, or 69%. Higher gross margins driven primarily by higher sales levels
and certain manufacturing cost improvements across most businesses within the
segment contributed to this increase. Belfab did not contribute to operating
profit during 1998.
 
CONSOLIDATED RESULTS -- RESTRUCTURING AND ASSET IMPAIRMENT CHARGES
 
     In 1997, as part of a plan to reposition its operations, the Company
recorded $7.8 million of integration costs, which included $4.4 million related
to employee separation costs and $3.4 million related to its consolidation
effort. These costs were included in selling, general and administrative
expenses.
 
     The Company developed restructuring plans during 1998 to integrate and
consolidate its businesses and recorded restructuring charges in the first and
second quarters of 1998. The Company developed additional plans during the third
quarter of 1999 to restructure certain businesses to continue to improve the
Company's performance. Each plan is discussed separately below and in more
detail in Note 3 to the accompanying consolidated financial statements.
 
  First Quarter of 1998 Plan
 
     During the first quarter of 1998, management developed a plan to
restructure certain businesses. A discussion of the businesses affected within
each segment is presented in detail in Note 3. The plan resulted in pre-tax
restructuring charges totaling $30.5 million. The principal actions in the
restructuring plan included close-down or consolidation of a number of offices
and facilities, transfer of assembly activities to lower cost geographic
locations, disposal of underutilized assets, withdrawal from certain product
lines and general cost reductions.
 
  Second Quarter of 1998 Plan
 
     During the second quarter of 1998, the Company expanded its continuing
effort to restructure certain businesses to further improve performance. The
plan resulted in additional pre-tax restructuring charges of $19.5 million. The
principal actions in this restructuring plan included the integration of
operating divisions into five strategic business units (SBUs), close-down or
consolidation of a number of production facilities and general cost reductions.
As discussed in Note 8 to the accompanying financial statements, the Company has
since divested its Technical Services segment. Pre-tax restructuring charges of
$4.5 million were charged to discontinued operations in 1998 ($0.9 million in
the first quarter and $3.6 million in the second quarter), primarily related to
severance benefits, all of which have been incurred as of January 2, 2000.
 
                                       18

<PAGE>   20
 
  Third Quarter of 1999
 
     During the third quarter of 1999, due to the substantial completion of the
actions of the 1998 restructuring plans, the Company reevaluated its 1998
restructuring plans. As a result of this review, costs associated with the
previously planned shutdown of two businesses were no longer required due to
actions taken to improve performance. As a result of these recent developments,
the Company recognized a restructuring credit of $12 million during the third
quarter of 1999, which primarily affected the Fluid Sciences and Optoelectronics
segments. The $12 million credit is reflected in "Restructuring Charges, Net" in
the Consolidated Income Statements.
 
     The acquisitions by the Company discussed in Note 2 to the accompanying
consolidated financial statements and the Company's divestiture during the third
quarter of 1999 of its Technical Services segment discussed in Note 8 to the
accompanying consolidated financial statements (exiting government services)
were strategic milestones in the Company's transition to a commercial
high-technology company. Consistent with the strategic direction of the Company
and concurrent with the reevaluation of existing restructuring plans during the
third quarter of 1999, the Company developed additional plans during the third
quarter of 1999 to restructure certain businesses to continue to improve the
Company's performance.
 
     These plans resulted in a pre-tax restructuring charge of $23.5 million
recorded in the third quarter of 1999. The principal actions in these
restructuring plans include close-down or consolidation of a number of offices
and facilities, transfer of assembly activities to lower-cost geographic
locations, disposal of under-utilized assets, withdrawal from certain product
lines and general cost reductions. Details related to these restructuring plans
are discussed in Note 3 to the accompanying consolidated financial statements.
 
     The components of the restructuring charges met the criteria set forth in
Emerging Issues Task Force Issue 94-3, Liability Recognition for Certain
Employee Termination Benefits and Other Costs to Exit an Activity (Including
Certain Costs Incurred in a Restructuring). The charges do not include
additional costs associated with the restructuring plans, such as training,
consulting, purchase of equipment and relocation of employees and equipment.
These costs were charged to operations or capitalized, as appropriate, when
incurred.
 
     As discussed in Note 2 to the accompanying consolidated financial
statements, approximately $5 million was recorded as accrued restructuring
charges in connection with the Lumen acquisition and approximately $28 million
was recorded as accrued restructuring charges in connection with the acquisition
of PEAI.
 
     Cash outlays during 1999 and 1998 were $32.5 million and $23.5 million,
respectively, for all of the plans discussed above. The Company expects to incur
approximately $25-$30 million of cash outlays in connection with these plans
throughout fiscal 2000. These funds will come from operating cash flows or
borrowing from existing credit facilities. The estimated full year's pre-tax
savings under the restructuring plans, due primarily to lower depreciation and
lower employment costs, when the plans are fully implemented are anticipated to
be approximately $27-$30 million, or $.37 to $.42 per share.
 
     During the third quarter of 1999, in connection with its ongoing review of
its portfolio of businesses, the Company conducted a strategic review of certain
units within its business segments. The strategic review triggered an impairment
review of long-lived assets of certain businesses which are expected to be
disposed. The Company calculated the present value of expected cash flows of
certain business units to determine the fair value of those assets. Accordingly,
in the third quarter of 1999, the Company recorded noncash impairment charges
and wrote down goodwill by $15 million in the Instruments segment and $3 million
in the Optoelectronics segment. Sales and operating profit for the businesses
under strategic review were approximately $54 million and $2 million,
respectively, in 1999.
 
     During the second quarter of 1998, the Company recorded a $7.4 million
noncash impairment charge related to an automotive testing facility in the
Instruments segment. The impairment charge applied to fixed assets and resulted
from projected changes in the principal customer's demand for services. The
Company calculated the present value of expected cash flows of the testing
facility to determine the fair value of the assets.
 
                                       19

<PAGE>   21
 
     During the second quarter of 1997, the Company recorded a noncash
impairment charge of $28.2 million, with $26.7 million related to IC Sensors in
the Optoelectronics segment and $1.5 million related to the goodwill of an
environmental services business in Other. As a result of IC Sensors' inability
to achieve the improvements specified in its corrective action plan, it
continued operating at a loss in the second quarter of 1997, triggering an
impairment review of its long-lived assets. A revised operating plan was
developed to restructure and stabilize the business. The revised projections by
product line provided the basis for measurement of the asset impairment charge.
The Company calculated the present value of expected cash flows of IC Sensors'
product lines to determine the fair value of the assets. Accordingly, in the
second quarter of 1997, the Company recorded an impairment charge of $26.7
million, for a write-down of goodwill of $13.6 million and fixed assets of $13.1
million. The components of the revised operating plan included hiring a new
general manager, transferring assembly and test operations to a lower cost
environment (Batam, Indonesia), introducing new products and reviewing
manufacturing processes to improve production yields. All of these components
were implemented during 1997 and 1998. In February 2000, the Company sold its IC
Sensors business. The Company does not expect a material gain or loss from
disposition.
 
OTHER
 
     In January 1998, the Company sold its Rotron business unit for proceeds of
$103 million. In April 1998, the Company sold its Sealol Industrial Seals
operation for proceeds of $100 million, of which $45 million was utilized for
the Belfab acquisition. The Company realized gains of $125.8 million on the
dispositions.
 
DISCONTINUED OPERATIONS
 
     On August 20, 1999, the Company sold the assets of its Technical Services
segment, including the outstanding capital stock of EG&G Defense Materials,
Inc., a subsidiary of the Company, to EG&G Technical Services, Inc., an
affiliate of The Carlyle Group LP (the "Buyer"), for approximately $250 million
in cash and the assumption by the Buyer of certain liabilities of the Technical
Services segment. Details of the transaction are discussed in Note 8 to the
accompanying consolidated financial statements.
 
     The results of operations of the Technical Services segment were previously
reported as one of five business segments of the Company. The Company accounted
for the sale of its Technical Services segment as a discontinued operation in
accordance with APB Opinion No. 30 and, accordingly, the results of operations
of the Technical Services segment have been segregated from continuing
operations and reported as a separate line item on the Company's accompanying
Consolidated Income Statements.
 
     Summary operating results of the discontinued operations (through August
20, 1999) were as follows:
 

<TABLE>
<CAPTION>
                  (IN THOUSANDS)                       1999        1998        1997
                  --------------                     --------    --------    --------
<S>                                                  <C>         <C>         <C>
Sales..............................................  $302,776    $553,514    $613,118
Costs and expenses.................................   278,242     517,762     575,852
                                                     --------    --------    --------
Operating income from discontinued operations......    24,534      35,752      37,266
Other income.......................................     1,147       1,955       1,983
                                                     --------    --------    --------
Income from discontinued operations before income
  taxes............................................    25,681      37,707      39,249
Provision for income taxes.........................    10,016      14,706      15,119
                                                     --------    --------    --------
Income from discontinued operations, net of income
  taxes............................................  $ 15,665    $ 23,001    $ 24,130
                                                     ========    ========    ========
</TABLE>

 
OTHER EXPENSE
 
  1999 Compared to 1998
 
     Other expense, net, was $21.8 million in 1999 versus $1.4 million in 1998.
This net increase in other expense was due primarily to the impact of higher
interest expense on increased debt levels, at higher 1999 short term rates,
resulting from acquisitions. Included in 1999 other expense was $2.2 million of
income
 
                                       20

<PAGE>   22
 
received by the Company related to the demutualization of a life insurance
company in which the Company is a policyholder.
 
  1998 Compared to 1997
 
     Other expense, net, was $1.4 million for 1998 versus $7.6 million for 1997.
This net decrease of $6.2 million in other expense, net, in 1998 was due
primarily to the impact of higher interest income on increased cash balances
resulting from the 1998 dispositions and lower interest expense on reduced debt
levels during most of 1998. Included in 1998 other expense, net, was a $4.5
million gain on investment. Other expense, net, in 1997 included income of $3.4
million for a cost of capital reimbursement.
 
INCOME TAX PROVISION
 
     The provision for income taxes on pre-tax income from continuing operations
for 1999 and 1998 was $16.5 million and $39.3 million, respectively. Reported
income tax expense as a percent of pre-tax income for 1999 and 1998 was 36.8%
and 33.2% respectively, due, in part, to the income tax effect on nonrecurring
items. Excluding the asset impairment charges and related tax effects, the
effective tax rate was 32% in 1999. The geographical mix of the Company's
revenues was affected during the third quarter of 1999 as the Company sold its
Technical Services segment and integrated PEAI acquired late in the second
quarter of 1999. The income of the Technical Services segment was taxed at the
U.S. federal rate and applicable state and local rates given that its revenues
were earned domestically. The provision for income taxes related to the
Technical Services segment is presented as a component of income from
discontinued operations in the accompanying Consolidated Income Statements. As a
result, the stand-alone effective tax rate attributable to that segment has
historically been higher than the overall 36% effective tax rate for the total
Company in the first and second quarters of 1999. The majority of the revenue of
PEAI is generated in non-U.S. countries with overall lower tax rates than the
historical 36% effective tax rate for the Company prior to the PEAI acquisition.
 
     The 1998 effective tax rate of 33.2% was impacted by the tax consequences
of the gains on dispositions and restructuring charges. Excluding these items
and their related tax effects, the 1998 effective tax rate was higher than the
1997 base effective rate of 30.6% due primarily to the changes in the
geographical distribution of income resulting from the divestiture of the Sealol
Industrial Seals business unit.
 
FINANCIAL CONDITION
 
     Short-term debt at January 2, 2000 was $382 million and included one-year
secured promissory notes of $150 million issued to PE Corp. at an interest rate
of 5%, money market loans of $85 million and commercial paper borrowings of $140
million. The weighted-average interest rate on the money market loans, which had
maturities of 90 days or less, was 6.7%. The weighted-average interest rate on
the commercial paper borrowings, which had maturities of 120 days or less, was
6.5%. Short-term debt at January 3, 1999 was $158 million and consisted
primarily of commercial paper borrowings of $150 million, at a weighted-average
interest rate of 5.4%, that had maturities of 60 days or less. At January 3,
1999, short-term debt also included $6.2 million outstanding under a revolving
credit agreement, bearing interest at 9%, assumed by the Company in connection
with the Lumen acquisition. This amount was paid off in the first quarter of
1999.
 
     In March 2000, the Company's $250 million revolving credit facility was
refinanced and increased to a $300 million revolving credit facility that
expires in March 2001. The Company has an additional revolving credit agreement
for $100 million that expires in March 2002.
 
     At January 2, 2000, long-term debt included $115 million of unsecured
ten-year notes issued in October 1995 at an interest rate of 6.8%, which mature
in 2005. The carrying amount approximated the estimated fair value at January 2,
2000, based on a quoted market price. At January 3, 1999, long-term debt also
included $14.8 million assumed by the Company in connection with the Lumen
acquisition, consisting of unsecured notes of $12.4 million at 8% due in 2002
and a $2.4 million term loan at prime plus 1.75% due in 2000. The unsecured
notes and the loan were retired during 1999.
 
                                       21

<PAGE>   23
 
     In January 1999, the Company filed a shelf registration statement with the
Securities and Exchange Commission (SEC) to register $465 million of securities.
This registration statement, together with the $35 million of securities covered
by a previously filed registration statement, will provide the Company with
financing flexibility to offer up to $500 million aggregate principal amount of
common stock, preferred stock, depository shares, debt securities, warrants,
stock purchase contracts and/or stock purchase units. The Company expects to use
the net proceeds from the sale of the securities for general corporate purposes,
which may include, among other things: the repayment of outstanding
indebtedness, working capital, capital expenditures, the repurchase of shares of
common stock and acquisitions. The precise amount and timing of the application
of such proceeds will depend upon the Company's funding requirements and the
availability and cost of other funds. The Company's credit facilities and shelf
registration statements provide flexibility to refinance its outstanding debt
instruments at January 2, 2000 as they mature. The Company's market
capitalization as of January 2, 2000 was approximately $2,028 million.
 
     Cash and cash equivalents increased by $31.1 million and were $126.7
million at the end of fiscal 1999. Net cash provided by operating activities for
1999 was $115.8 million and included $7.1 million of cash provided by
discontinued operations. The $108.8 million net cash provided by continuing
operating activities was comprised of net income from continuing operations
before depreciation, amortization and other non cash items, net, of $147.6
million offset by gains on dispositions and sales of investments, net, of $21.6
million and a $17.2 million net change in certain other assets and liabilities
during 1999. The primary components of this net change included a $54.4 million
increase in accounts receivable, a decrease in inventory of $12.1 million and
$32 million of cash outlays associated with the integration of the acquired PEAI
and Lumen businesses as well as other restructuring activities. The accounts
receivable increase is due primarily to higher 1999 sales versus 1998,
specifically PEAI and Lumen acquisitions. Capital expenditures for 1999 were
$41.1 million.
 
     During 1999, the Company reduced the number of shares purchased of its
common stock versus 1998 and prior years and utilized available cash and
equivalents to fund acquisitions, restructure its businesses and invest in
growth opportunities. During 1999 and 1998, the Company purchased twenty
thousand and 1.8 million shares, respectively, of its common stock through
periodic purchases on the open market at a cost of $0.9 million and $41.2
million, respectively. As of January 2, 2000, the Company had authorization to
purchase 5.9 million additional shares.
 
     The Company has limited involvement with derivative financial instruments
and uses forward contracts to mitigate the effect of foreign currency movements
on transactions denominated in foreign currencies. The contracts generally have
maturities that do not exceed one month and have no cash requirements until
maturity. Credit risk and market risk are minimal because the contracts are with
large banks and gains and losses are offset against foreign exchange gains and
losses on the underlying hedged transactions. The notional amount of outstanding
forward contracts was $75 million as of January 2, 2000.
 
REVENUE RECOGNITION
 
     The Securities and Exchange Commission released Staff Accounting Bulletin
(SAB) No. 101, Revenue Recognition in Financial Statements, on December 3, 1999.
This SAB provides additional guidance on the accounting for revenue recognition,
including both broad conceptual discussions as well as certain industry-
specific guidance. The new guidance that is most likely to have a potential
impact on the Company concerns customer acceptance and installation terms. The
Company is in the process of accumulating the information necessary to quantify
the potential impact of this new guidance. The guidance is effective for the
first quarter of fiscal 2000 and would be adopted by recording the effect of any
prior revenue transactions affected as a "cumulative effect of a change in
accounting principle" as of January 3, 2000.
 
DIVIDENDS
 
     In January 2000, the Company's Board of Directors declared a regular
quarterly cash dividend of 14 cents per share, resulting in an annual rate of 56
cents per share for fiscal 2000.
 
                                       22

<PAGE>   24
 
ENVIRONMENTAL
 
     The Company is conducting a number of environmental investigations and
remedial actions at current and former Company locations and, along with other
companies, has been named a potentially responsible party (PRP) for certain
waste disposal sites. The Company accrues for environmental issues in the
accounting period that the Company's responsibility is established and when the
cost can be reasonably estimated. The Company has accrued $12.3 million as of
January 2, 2000, representing management's estimate of the total cost of
ultimate disposition of known environmental matters. Such amount is not
discounted and does not reflect any recovery of any amounts through insurance or
indemnification arrangements. These cost estimates are subject to a number of
variables, including the stage of the environmental investigations, the
magnitude of the possible contamination, the nature of the potential remedies,
possible joint and several liability, the timeframe over which remediation may
occur and the possible effects of changing laws and regulations. For sites where
the Company has been named a PRP, management does not currently anticipate any
additional liability to result from the inability of other significant named
parties to contribute. The Company expects that such accrued amounts could be
paid out over a period of up to five years. As assessments and remediation
activities progress at each individual site, these liabilities are reviewed and
adjusted to reflect additional information as it becomes available. There have
been no environmental problems to date that have had or are expected to have a
material effect on the Company's financial position or results of operations.
While it is reasonably possible that a material loss exceeding the amounts
recorded may have been incurred, the preliminary stages of the investigations
make it impossible for the Company to reasonably estimate the range of potential
exposure.
 
                              THE YEAR 2000 ISSUE
 
     The following Year 2000 statements constitute a Year 2000 Readiness
Disclosure within the meaning of the Year 2000 Readiness and Disclosure Act of
1998.
 
     The operations of the Company rely on various computer technologies which,
as is common to most corporations, may be affected by what is commonly referred
to as the Year 2000 ("Y2K") issue. The Y2K issue is the result of computer
programs that were written using two digits rather than four to define the
applicable year. Computer equipment and software, as well as devices with
embedded technology that are time-sensitive, may recognize a date using "00" as
the year 1900 rather than the year 2000. This could result in system failure or
miscalculations causing disruption of operations and normal business activities.
 
     As of January 2, 2000, the Company did not experience a material effect on
its business as a result of the Y2K issue. The financial condition and results
of operations for fiscal year ended January 2, 2000 were not materially impacted
by the Y2K issue. The Company has not recorded any loss contingencies at January
2, 2000 associated with the Y2K issue and has not incurred any material losses
through January 2, 2000. There were no material changes in the estimated costs
related to the Company's Y2K remediation efforts. The Company did not incur or
experience any material adverse spending patterns or cost relationships related
to its Y2K program or remediation activities through January 2, 2000 nor did the
Company postpone any expenses as a result of the Y2K issue as of January 2,
2000. No material changes in customers' buying patterns occurred through January
2, 2000 and the Company did not experience a significant increase in returns of
certain products as a result of the Y2K issue. The Company did not experience
any material Y2K legal claims due to its inability to perform contractual
responsibilities or from failure of its products.
 
     As part of its Y2K program, the Company assessed the effect on the Company
of the Y2K compliance of its significant customers, vendors, suppliers, raw
materials suppliers, primary service suppliers, and financial institutions. The
Company has followed a strategy of identification of risks, risk assessment,
continuous material third party monitoring and evaluation, and contingency
planning. The Company did not use or engage outside firms for the purpose of
independent verification and validation of the reliability of third party risks
assessed and cost estimates related thereto under the Company's Y2K program.
 
     Although the Company has reviewed the Y2K compliance of a substantial
number of its material third parties, it is currently unable to predict the
final readiness of all of its material third parties. Certain of the
 
                                       23

<PAGE>   25
 
Company's products are used in conjunction with products of other companies in
applications that may be critical to the operations of its customers. Any
Company product's Y2K non compliance, whether standing alone or used in
conjunction with the products of other companies, may expose the Company to
claims from its customers, material third parties or others, and could impair
market acceptance of the Company's products or services, increase service and
warranty costs, or result in payment of damages, which in turn could materially
adversely affect the results of operations and financial position of the
Company. While the Company expects such material third parties to address the
Y2K issue based on the representations made by such third parties to the
Company, it cannot guarantee that these systems have been made Y2K compliant or
will be made Y2K compliant in a timely manner and cannot guarantee that it will
not experience a material adverse effect as a result of such non compliance.
 
     The costs incurred by the Company through January 2, 2000 to address the
Y2K issue totaled approximately $8 million. The costs include those incurred by
the Company's Technical Services segment, which was divested in August 1999.
These amounts include the costs to lease, purchase or expense new software and
equipment needed to achieve Year 2000 compliance and enhance existing systems,
as well as internal costs related to this effort. Amounts expended for the
Company's Y2K program were outside of and incremental to the Company's IT budget
for ongoing operational projects. With the exception of new hardware or software
which qualify for capitalization under generally accepted accounting principles,
the Company expensed all costs associated with the Y2K program. Funding
requirements for the Company's Y2K Program activities during fiscal 2000 are not
expected to be significant and have been incorporated into the Company's 2000
capital and operating plans. The Company will utilize cash and equivalents and
cash flows from operations to fund remaining Y2K program costs during 2000. None
of the Company's other IT projects have been deferred due to its Y2K efforts.
 
EURO CONVERSION
 
     On January 1, 1999, eleven of the fifteen member countries of the European
Union established fixed conversion rates between their existing sovereign
currencies and the new common legal currency, the "Euro", which was adopted on
that date. There is a transition period between January 1, 1999 and January 1,
2002, during which the Euro will be adopted into the operations. Areas of
assessment by the Company since 1998 have included the following: cross-border
price transparencies and the resulting competitive impact; adaptation of
information technology and other system requirements to accommodate Euro
transactions; the impact on currency exchange rate risk; the impact on existing
contracts; and taxation and accounting. The Company's assessment is that the
anticipated impact of the Euro conversion on the Company's operations will not
be material.
 
FORWARD-LOOKING INFORMATION AND FACTORS AFFECTING FUTURE PERFORMANCE
 
     This report contains "forward-looking statements" as defined in Section 21E
of the Securities and Exchange Commission Act of 1934. For this purpose, any
statements contained in this report that are not statements of historical fact
may be deemed to be forward-looking statements. Words such as "believes,"
"anticipates," "plans," "expects," "will" and similar expressions are intended
to identify forward-looking statements. There are a number of important factors
that could cause the results of PerkinElmer, Inc. to differ materially from
those indicated by these forward-looking statements including, among others, the
factors set forth below.
 
     The following important factors affect our business and operations
generally or affect multiple segments of our business and operations:
 
     - PerkinElmer faces strong competition in many of the markets that it
       serves, which affects its ability to sell its products and services and
       the prices that it obtains. Some of PerkinElmer's competitors are larger
       than it is and have greater financial and other resources.
 
     - If PerkinElmer is unable to successfully implement the restructuring
       plans that it has adopted, it will not be able to achieve anticipated
       costs savings, its ability to produce and deliver the products and
       services may be adversely affected and it may lose customers and key
       personnel.
 
                                       24

<PAGE>   26
 
     - PerkinElmer's business plan depends on its ability to continue to
       innovate, develop new products and services based on such innovations and
       introduce these new products and services successfully into the market.
       If PerkinElmer is unable to successfully implement this business plan, it
       could have a material adverse effect on PerkinElmer's business, financial
       condition and results of operations.
 
     - PerkinElmer's business plan depends on its ability to acquire attractive
       businesses on favorable terms and integrate these businesses into
       PerkinElmer's other operations. If PerkinElmer is unable to successfully
       implement this business plan, it could have a material adverse effect on
       PerkinElmer's business, financial condition and results of operations.
 
     - In many of PerkinElmer's segments, PerkinElmer serves as a supplier of
       components to other businesses with whom its customers transact business.
       As a result, PerkinElmer's success depends on the business success of its
       customers.
 
     - PerkinElmer needs to be able to continue to access the capital markets to
       fund its growth.
 
     - PerkinElmer's products businesses can be affected by currency risks.
 
     - PerkinElmer needs to achieve satisfactory results in connection with
       certain litigation to which it is a party, particularly its ongoing tax
       litigation with the Internal Revenue Service.
 
     - PerkinElmer needs to attract and retain key management, operational and
       technical personnel.
 
     - PerkinElmer is affected by general economic conditions.
 
     - PerkinElmer could be impacted during fiscal 2000 and beyond by
       unanticipated issues associated with Year 2000 software problems.
 
     - PerkinElmer's effective tax rates in the future could be affected by
       changes in the geographic distribution of income, utilization of non-U.S.
       net operating loss carryforwards, repatriation costs, resolution of
       outstanding tax audit issues and changes in the portfolio of businesses.
 
     PerkinElmer is subject to the following risks that may affect particular
business segments:
 
  Life Sciences
 
     - PerkinElmer's business plan for this segment is significantly dependent
       upon the successful introduction of products currently under development
       as well as the expansion of the geographic markets for this segment's
       products.
 
     - Many of PerkinElmer's products in this segment are subject to regulation
       by the Food and Drug Administration and other regulatory bodies.
 
     - Many of PerkinElmer's products in this segment are used by pharmaceutical
       companies and research laboratories, so the success of these products is
       dependent upon the success of these customers.
 
  Optoelectronics
 
     - PerkinElmer needs to continue the development of its telecommunications
       and amorphous silicon technologies and continue to successfully introduce
       additional products based on these technologies to the respective
       markets.
 
     - PerkinElmer needs to successfully shift the production of certain
       products to lower cost geographic areas such as the Philippines,
       Indonesia and China in order to compete effectively.
 
  Instruments
 
     - PerkinElmer's ability to obtain Federal Aviation Administration
       certification of its Z scan system for screening of checked baggage on a
       timely basis will affect this business segment's success.
 
                                       25

<PAGE>   27
 
     - PerkinElmer needs to continue to successfully integrate the analytical
       instruments business acquired from PE Corp. in May 1999.
 
     - PerkinElmer needs to successfully integrate the Vivid business acquired
       in January 2000.
 
     - PerkinElmer needs to continue to develop new technology and successfully
       introduce additional products based on this technology to the market.
 
  Fluid Sciences
 
     - Key customers for certain of this business segment's products manufacture
       equipment used in semiconductor production. As a result, the success of
       this segment's operations is dependent in part upon the continued
       recovery of economic conditions in the semiconductor industry and the
       ability to ramp up capacity to meet increased customer demand.
 
     - PerkinElmer is in the process of implementing new lower cost
       manufacturing processes for certain of this segment's products. The
       success of this segment's operations depends in part upon PerkinElmer's
       successfully implementing these new manufacturing processes.
 
     - Key customers for the products of this segment are manufacturers of air
       frames and engines for regional and business jets. As a result, the
       success of this segment is dependent in part upon continued growth in the
       regional and business jet markets, no significant reduction in the
       projected demand and associated build rates of original equipment
       manufacturers (OEM) of large transport aircraft, and expansion of the
       maintenance, repair, and overhaul business.
 
     - The success of our operations in this segment depends in part on entering
       into long-term contracts for the sale of seals and components to original
       equipment manufacturers of aircraft, air frames, and engines,
       semiconductor equipment, and automotive lubricants on favorable terms.
 
MARKET RISK
 
     Market Risk:  The Company is exposed to market risk, including changes in
interest rates and currency exchange rates. To manage the volatility relating to
these exposures, the Company enters into various derivative transactions
pursuant to the Company's policies to hedge against known or forecasted market
exposures.
 
     Foreign Exchange Risk Management:  As a multinational corporation, the
Company is exposed to changes in foreign exchange rates. As the Company's
international sales grow, exposure to volatility in exchange rates could have a
material adverse impact on the Company's financial results. The Company's risk
from exchange rate changes is primarily related to non-dollar denominated sales
in Europe and Asia. The Company uses foreign currency forward and option
contracts to manage the risk of exchange rate fluctuations. The Company uses
these derivative instruments to reduce its foreign exchange risk by essentially
creating offsetting market exposures. The instruments held by the Company are
not leveraged and are not held for trading purposes. The Company uses forward
exchange contracts to hedge its net asset (balance sheet) position. The success
of the hedging program depends on forecasts of transaction activity in the
various currencies. To the extent that these forecasts are over or understated
during periods of currency volatility, the Company could experience
unanticipated currency gains or losses. The principal currencies hedged are the
British Pound, Canadian Dollar, Euro, Japanese Yen and Singapore Dollar. In
those currencies where there is a liquid, cost-effective forward market, the
Company maintains hedge coverage between minimum and maximum percentages of its
anticipated transaction exposure for periods not to exceed one year. The gains
and losses on these contracts offset changes in the value of the related
exposure.
 
     Interest Rate Risk:  The Company maintains an investment portfolio
consisting of securities of various issuers, types and maturities. The
investments are classified as available for sale. These securities are recorded
on the balance sheet at market value, with any unrealized gain or loss recorded
in comprehensive income. These instruments are not leveraged, and are not held
for trading purposes.
 
                                       26

<PAGE>   28
 
     Value-At-Risk:  The Company utilizes a Value-at-Risk ("VAR") model to
determine the maximum potential loss in the fair value of its interest rate and
foreign exchange sensitive derivative financial instruments within a 95%
confidence interval. The Company's computation was based on the
interrelationships between movements in interest rates and foreign currencies.
These interrelationships were determined by observing historical interest rate
and foreign currency market changes over corresponding periods. The assets and
liabilities, firm commitments and anticipated transactions, which are hedged by
derivative financial instruments, were excluded from the model. The VAR model
estimates were made assuming normal market conditions and a 95% confidence
level. There are various modeling techniques that can be used in the VAR
computation. The Company's computations are based on the Monte Carlo simulation.
The VAR model is a risk analysis tool and does not purport to represent actual
gains or losses in fair value that will be incurred by the Company. The VAR
model estimated a maximum loss in market value of $.8 million from January 3,
2000 through December 31, 2000 for derivative instruments held as of January 2,
2000.
 
     Management periodically reviews its interest rate and foreign currency
exposures and evaluates strategies to manage such exposures in the near future.
The Company implements changes, when deemed necessary, in the management of
hedging instruments which mitigate its exposure.
 
     Since the Company utilizes interest rate and foreign currency sensitive
derivative instruments for hedging, a loss in fair value for those instruments
is generally offset by increases in the value of the underlying transaction.
 
     It is the Company's policy to enter into foreign currency and interest rate
transactions only to the extent considered necessary to meet its objectives as
stated above. The Company does not enter into foreign currency or interest rate
transactions for speculative purposes.
 
                                       27

<PAGE>   29
 

I
TEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA
 
                       PERKINELMER, INC. AND SUBSIDIARIES
 
                         CONSOLIDATED INCOME STATEMENTS
                   FOR THE THREE YEARS ENDED JANUARY 2, 2000
 

<TABLE>
<CAPTION>
      (DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA)            1999         1998         1997
      --------------------------------------------         ----------    ---------    --------
<S>                                                        <C>           <C>          <C>
Sales:
  Products...............................................  $1,206,038    $ 784,520    $860,598
  Services...............................................     157,091       69,862      66,884
                                                           ----------    ---------    --------
TOTAL SALES..............................................   1,363,129      854,382     927,482
                                                           ----------    ---------    --------
Cost of Sales:
  Products...............................................     746,417      496,861     553,551
  Services...............................................     107,043       54,126      53,195
  Revaluation of Acquired Inventory......................       9,857           --          --
                                                           ----------    ---------    --------
Total Cost of Sales......................................     863,317      550,987     606,746
Selling, General and Administrative Expenses.............     327,142      203,740     220,976
Research and Development Expenses........................      71,248       46,026      44,541
In-Process Research and Development Charges (Note 2).....      23,000        2,300          --
Restructuring Charges, Net (Note 3)......................      11,520       50,027          --
Asset Impairment Charges (Note 4)........................      18,000        7,400      28,200
Gains on Dispositions (Note 5)...........................     (17,750)    (125,822)         --
                                                           ----------    ---------    --------
OPERATING INCOME FROM CONTINUING OPERATIONS..............      66,652      119,724      27,019
Other Expense, Net (Note 6)..............................     (21,782)      (1,397)     (7,555)
                                                           ----------    ---------    --------
Income From Continuing Operations Before Income Taxes....      44,870      118,327      19,464
Provision for Income Taxes (Note 7)......................      16,499       39,326       9,902
                                                           ----------    ---------    --------
INCOME FROM CONTINUING OPERATIONS........................      28,371       79,001       9,562
Income From Discontinued Operations, Net of Income Taxes
  (Note 8)...............................................      15,665       23,001      24,130
Gain on Disposition of Discontinued Operations, Net of
  Income Taxes (Note 8)..................................     110,280           --          --
                                                           ----------    ---------    --------
NET INCOME...............................................  $  154,316    $ 102,002    $ 33,692
                                                           ==========    =========    ========
BASIC EARNINGS PER SHARE (NOTE 9):
  CONTINUING OPERATIONS..................................  $      .62    $    1.74    $    .21
  Discontinued Operations................................        2.77          .51         .53
                                                           ----------    ---------    --------
NET INCOME...............................................  $     3.39    $    2.25    $    .74
                                                           ==========    =========    ========
DILUTED EARNINGS PER SHARE (NOTE 9):
  CONTINUING OPERATIONS..................................  $      .61    $    1.72    $    .21
  Discontinued Operations................................        2.70          .50         .53
                                                           ----------    ---------    --------
NET INCOME...............................................  $     3.31    $    2.22    $    .74
                                                           ==========    =========    ========
</TABLE>

 
  The accompanying notes are an integral part of these consolidated financial
                                  statements.
 
                                       28

<PAGE>   30
 
                       PERKINELMER, INC. AND SUBSIDIARIES
 
                          CONSOLIDATED BALANCE SHEETS
                   AS OF JANUARY 2, 2000 AND JANUARY 3, 1999
 

<TABLE>
<CAPTION>
        (DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA)             1999          1998
        --------------------------------------------          ----------    ----------
<S>                                                           <C>           <C>
Current Assets:
  Cash and cash equivalents.................................  $  126,650    $   95,565
  Accounts receivable (Note 10).............................     346,160       170,171
  Inventories (Note 11).....................................     201,724       123,568
  Other current assets (Note 7).............................     140,560       110,954
  Net assets of discontinued operations (Note 8)............          --        32,087
                                                              ----------    ----------
TOTAL CURRENT ASSETS........................................     815,094       532,345
                                                              ----------    ----------
Property, Plant and Equipment:
  At cost (Notes 4 and 12)..................................     496,347       491,647
  Accumulated depreciation and amortization.................    (268,313)     (272,967)
                                                              ----------    ----------
Net Property, Plant and Equipment...........................     228,034       218,680
                                                              ----------    ----------
Investments (Note 13).......................................      14,911        13,506
Intangible Assets (Notes 4 and 14)..........................     592,438       317,611
Other Assets (Notes 7 and 17)...............................      64,163        56,636
                                                              ----------    ----------
TOTAL ASSETS................................................  $1,714,640    $1,138,778
                                                              ==========    ==========
Current Liabilities:
  Short-term debt (Note 15).................................  $  382,162    $  157,888
  Accounts payable..........................................     152,920        73,420
  Accrued restructuring costs (Note 3)......................      41,759        34,569
  Accrued expenses (Note 16)................................     275,657       218,600
                                                              ----------    ----------
TOTAL CURRENT LIABILITIES...................................     852,498       484,477
                                                              ----------    ----------
Long-Term Debt (Note 15)....................................     114,855       129,835
Long-Term Liabilities (Notes 7, 17 and 18)..................     196,511       124,799
Contingencies (Note 19)
Stockholders' Equity (Note 21):
  Preferred stock -- $1 par value, authorized 1,000,000
     shares; none outstanding...............................          --            --
  Common stock -- $1 par value, authorized 100,000,000
     shares; issued 60,102,000 shares in 1999 and 1998......      60,102        60,102
  Retained earnings.........................................     762,009       623,591
  Accumulated other comprehensive income (loss).............     (14,040)        3,729
  Cost of shares held in treasury; 13,736,000 shares in 1999
     and 15,355,000 shares in 1998..........................    (257,295)     (287,755)
                                                              ----------    ----------
Total Stockholders' Equity..................................     550,776       399,667
                                                              ----------    ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY..................  $1,714,640    $1,138,778
                                                              ==========    ==========
</TABLE>

 
  The accompanying notes are an integral part of these consolidated financial
                                  statements.
 
                                       29

<PAGE>   31
 
                       PERKINELMER, INC. AND SUBSIDIARIES
 
                CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                   FOR THE THREE YEARS ENDED JANUARY 2, 2000
 

<TABLE>
<CAPTION>
                                                                                    ACCUMULATED
                                                                                       OTHER
                                                                                   COMPREHENSIVE     COST OF         TOTAL
                                              COMPREHENSIVE   COMMON    RETAINED      INCOME       SHARES HELD   STOCKHOLDERS'
(DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA)     INCOME        STOCK    EARNINGS      (LOSS)       IN TREASURY      EQUITY
--------------------------------------------  -------------   -------   --------   -------------   -----------   -------------
<S>                                           <C>             <C>       <C>        <C>             <C>           <C>
BALANCE, DECEMBER 29, 1996.................                   $60,102   $532,043     $ 19,432       $(246,471)     $365,106
Comprehensive income:
  Net income...............................     $ 33,692          --      33,692           --              --        33,692
  Other comprehensive income (loss), net of
    tax:
    Foreign currency translation
      adjustments..........................      (22,608)         --          --      (22,608)             --       (22,608)
    Unrealized losses on securities:
      Losses arising during the period.....         (655)
      Reclassification adjustment..........          (26)
                                                --------
    Net unrealized losses..................         (681)         --          --         (681)             --          (681)
                                                --------
  Other comprehensive income (loss)........      (23,289)
                                                --------
Comprehensive income.......................     $ 10,403
                                                ========
Cash dividends ($.56 per share)............                       --     (25,684)          --              --       (25,684)
Exercise of employee stock options and
  related income tax benefits..............                       --         328           --           6,339         6,667
Purchase of common stock for treasury......                       --          --           --         (28,104)      (28,104)
                                                              -------   --------     --------       ---------      --------
BALANCE, DECEMBER 28, 1997.................                   60,102     540,379       (3,857)       (268,236)      328,388
Comprehensive income:
  Net income...............................     $102,002          --     102,002           --              --       102,002
  Other comprehensive income, net of tax:
    Gross foreign currency translation
      adjustments..........................        4,608          --          --        4,608              --         4,608
    Reclassification adjustment for
      translation losses realized upon sale
      of Sealol Industrial Seals...........        3,115          --          --        3,115              --         3,115
    Unrealized losses on securities arising
      during the period....................         (137)         --          --         (137)             --          (137)
                                                --------
  Other comprehensive income...............        7,586
                                                --------
Comprehensive income.......................     $109,588
                                                ========
Cash dividends ($.56 per share)............                       --     (25,408)          --              --       (25,408)
Exercise of employee stock options and
  related income tax benefits..............                       --       6,618           --          21,698        28,316
Purchase of common stock for treasury......                       --          --           --         (41,217)      (41,217)
                                                              -------   --------     --------       ---------      --------
BALANCE, JANUARY 3, 1999...................                   60,102     623,591        3,729        (287,755)      399,667
Comprehensive income:
  Net income...............................     $154,316          --     154,316           --              --       154,316
  Other comprehensive income (loss), net of
    tax:
    Foreign currency translation
      adjustments..........................      (17,804)         --          --      (17,804)             --       (17,804)
    Unrealized gains on securities:
      Gains arising during the period......           93
      Reclassification adjustment..........          (58)
                                                --------
    Net unrealized gains...................           35          --          --           35              --            35
                                                --------
  Other comprehensive income (loss)........      (17,769)
                                                --------
Comprehensive income.......................     $136,547
                                                ========
Cash dividends ($.56 per share)............                       --     (25,499)          --              --       (25,499)
Exercise of employee stock options and
  related income tax benefits..............                       --       8,369           --          20,264        28,633
Issuance of common stock for employee
  benefit plans............................                       --       1,232           --          11,166        12,398
Purchase of common stock for treasury......                       --          --           --            (970)         (970)
                                                              -------   --------     --------       ---------      --------
BALANCE, JANUARY 2, 2000...................                   $60,102   $762,009     $(14,040)      $(257,295)     $550,776
                                                              =======   ========     ========       =========      ========
</TABLE>

 
  The accompanying notes are an integral part of these consolidated financial
                                  statements.
                                       30

<PAGE>   32
 
                       PERKINELMER, INC. AND SUBSIDIARIES
 
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                   FOR THE THREE YEARS ENDED JANUARY 2, 2000
 

<TABLE>
<CAPTION>
                   (DOLLARS IN THOUSANDS)                       1999        1998        1997
                   ----------------------                     ---------   ---------   --------
<S>                                                           <C>         <C>         <C>
Operating Activities:
  Net income................................................  $ 154,316   $ 102,002   $ 33,692
  Deduct net income from discontinued operations............    (15,665)    (23,001)   (24,130)
  Deduct net gain on disposition of discontinued
    operations..............................................   (110,280)         --         --
                                                              ---------   ---------   --------
  Income from continuing operations.........................     28,371      79,001      9,562
  Adjustments to reconcile income from continuing operations
    to net cash provided by continuing operations:
    Revaluation of acquired inventory.......................      9,857          --         --
    In-process research and development charges.............     23,000       2,300         --
    Noncash portion of restructuring charges................      2,300      12,020         --
    Asset impairment charges................................     18,000       7,400     28,200
    Depreciation and amortization...........................     66,115      48,510     42,698
    Gains on dispositions and sales of investments, net.....    (21,624)   (130,545)   (11,713)
    Changes in assets and liabilities which provided (used)
     cash, excluding effects from companies purchased and
     divested:
      Accounts receivable...................................    (54,439)      7,830    (24,507)
      Inventories...........................................     12,132       3,265     (2,475)
      Accounts payable and accrued expenses.................     62,660      13,797        291
      Accrued restructuring costs...........................    (21,005)     29,569      3,025
      Noncurrent prepaid pension............................         --          --    (10,040)
      Prepaid and deferred taxes............................     (2,616)    (12,359)    (4,315)
      Prepaid expenses and other............................    (13,983)    (19,935)   (19,321)
                                                              ---------   ---------   --------
Net Cash Provided by Continuing Operations..................    108,768      40,853     11,405
Net Cash Provided by Discontinued Operations................      7,061      28,702     23,433
                                                              ---------   ---------   --------
Net Cash Provided by Operating Activities...................    115,829      69,555     34,838
                                                              ---------   ---------   --------
Investing Activities:
  Capital expenditures......................................    (41,092)    (44,489)   (47,642)
  Reimbursement of invested capital (Note 18)...............         --          --     27,000
  Proceeds from dispositions of businesses and sales of
    property, plant and equipment...........................     31,560     210,505     24,287
  Cost of acquisitions, net of cash and cash equivalents
    acquired................................................   (302,288)   (217,937)    (3,611)
  Proceeds from sales of investments........................      6,086       7,623      4,129
  Other.....................................................     (1,408)       (160)    (1,156)
                                                              ---------   ---------   --------
Net Cash Provided by (Used in) Continuing Operations........   (307,142)    (44,458)     3,007
Net Cash Provided by (Used in) Discontinued Operations......    163,259      (2,033)    (1,087)
                                                              ---------   ---------   --------
Net Cash Provided by (Used in) Investing Activities.........   (143,883)    (46,491)     1,920
                                                              ---------   ---------   --------
Financing Activities:
  Increase (decrease) in commercial paper borrowings........    (10,000)    104,156     27,879
  Payment of acquired Lumen revolving credit borrowings.....         --     (59,090)        --
  Other debt increases (decreases)..........................     69,529       7,270     (3,443)
  Proceeds from issuance of common stock....................     28,923      28,316      6,667
  Purchases of common stock.................................       (970)    (41,217)   (28,104)
  Cash dividends............................................    (25,499)    (25,408)   (25,684)
                                                              ---------   ---------   --------
Net Cash Provided by (Used in) Continuing Operations........     61,983      14,027    (22,685)
Net Cash Provided by (Used in) Discontinued Operations......         --          --         --
                                                              ---------   ---------   --------
Net Cash Provided by (Used in) Financing Activities.........     61,983      14,027    (22,685)
                                                              ---------   ---------   --------
Effect of Exchange Rate Changes on Cash and Cash
  Equivalents...............................................     (2,844)        540     (3,985)
                                                              ---------   ---------   --------
Net Increase in Cash and Cash Equivalents...................     31,085      37,631     10,088
Cash and Cash Equivalents at Beginning of Year..............     95,565      57,934     47,846
                                                              ---------   ---------   --------
Cash and Cash Equivalents at End of Year....................  $ 126,650   $  95,565   $ 57,934
                                                              =========   =========   ========
Supplemental Disclosures of Cash Flow Information:
  Cash paid during the year for:
    Interest................................................  $  28,438   $  12,367   $ 12,351
    Income taxes............................................     82,368      59,029     26,683
  Noncash Investing and Financing Activities:
    One-year secured 5% promissory notes issued to PE Corp.
     in connection with the acquisition of the Analytical
     Instruments Division (Note 2)..........................    150,000          --         --
</TABLE>

 
  The accompanying notes are an integral part of these consolidated financial
                                  statements.
 
                                       31

<PAGE>   33
 
                       PERKINELMER, INC. AND SUBSIDIARIES
 

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
NOTE 1.  NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES
 
     Principles of Consolidation:  The consolidated financial statements include
the accounts of PerkinElmer, Inc. (formerly EG&G, Inc.) and its subsidiaries
(the Company). All material intercompany balances and transactions have been
eliminated in consolidation.
 
     Nature of Operations:  PerkinElmer, Inc. is a global high-technology
company which provides products and systems to the telecom, medical,
pharmaceutical, chemical, semiconductor, photographic and other markets. The
Company's operating segments are Life Sciences, Optoelectronics, Instruments and
Fluid Sciences. In August 1999, the Company divested its Technical Services
segment, which is presented as discontinued operations in accordance with
Accounting Principles Board (APB) Opinion No. 30, Reporting the Results of
Operations (see Note 8).
 
     Use of Estimates:  The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
 
     Sales:  Product sales are recorded at the time of shipment and when
persuasive evidence of an arrangement exists, the seller's price to the buyer is
fixed or determinable and collectibility is reasonably assured. Service sales
are generally recorded as the services are rendered. If a loss is anticipated on
any contract, provision for the entire loss is made immediately. The former
Technical Services segment had cost-reimbursement contracts with governmental
agencies. These contracts included both cost plus fixed fee contracts and cost
plus award fee contracts based on performance. Sales under cost-reimbursement
contracts were recorded as costs were incurred and included applicable income in
the proportion that costs incurred bear to total estimated costs.
 
     The Securities and Exchange Commission released Staff Accounting Bulletin
(SAB) No. 101, Revenue Recognition in Financial Statements, on December 3, 1999.
This SAB provides additional guidance on the accounting for revenue recognition,
including both broad conceptual discussions as well as certain industry-
specific guidance. The new guidance that is most likely to have a potential
impact on the Company concerns customer acceptance and installation terms. The
Company is in the process of accumulating the information necessary to quantify
the potential impact of this new guidance. The guidance is effective for the
first quarter of fiscal 2000 and would be adopted by recording the effect of any
prior revenue transactions affected as a "cumulative effect of a change in
accounting principle" as of January 3, 2000.
 
     Inventories:  Inventories, which include material, labor and manufacturing
overhead, are valued at the lower of cost or market. The majority of inventories
is accounted for using the first-in, first-out method of determining inventory
costs; remaining inventories are accounted for using the last-in, first-out
(LIFO) method.
 
     Property, Plant and Equipment:  For financial statement purposes, the
Company depreciates plant and equipment using the straight-line method over
their estimated useful lives, which generally fall within the following ranges:
buildings and special-purpose structures -- 10 to 25 years; leasehold
improvements -- estimated useful life or remaining term of lease, whichever is
shorter; machinery and equipment -- 3 to 7 years. Nonrecurring tooling costs are
capitalized, while recurring costs are expensed. For income tax purposes, the
Company depreciates plant and equipment over their estimated useful lives using
accelerated methods.
 
     Pension Plans:  The Company's funding policy provides that payments to the
U.S. pension trusts shall at least be equal to the minimum funding requirements
of the Employee Retirement Income Security Act of 1974. Non-U.S. plans are
accrued for, but generally not funded, and benefits are paid from operating
funds.
 
                                       32

<PAGE>   34
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     Translation of Foreign Currencies:  The balance sheet accounts of non-U.S.
operations, exclusive of stockholders' equity, are translated at year-end
exchange rates, and income statement accounts are translated at weighted-average
rates in effect during the year; any translation adjustments are made directly
to a component of stockholders' equity. The net transaction gains (losses) were
not material for the years presented.
 
     Intangible Assets:  In accordance with Statement of Financial Accounting
Standards (SFAS) No. 121, Accounting for the Impairment of Long-Lived Assets and
for Long-Lived Assets to be Disposed Of, and APB Opinion No. 17, Intangible
Assets, the Company reviews long-lived assets and all intangible assets
(including goodwill) for impairment whenever events or changes in circumstances
indicate the carrying amount of such assets may not be recoverable.
Recoverability of these assets is determined by comparing the forecasted
undiscounted net cash flows of the operation to which the assets relate, to the
carrying amount including associated intangible assets of such operation. If the
operation is determined to be unable to recover the carrying amount of its
assets, then intangible assets are written down first, followed by the other
long-lived assets of the operation, to fair value. Fair value is determined
based on discounted cash flows or appraised values, depending upon the nature of
the assets. (See Note 4 for further discussion of asset impairment charges.)
 
     Stock-Based Compensation:  In accordance with SFAS No. 123, Accounting for
Stock-Based Compensation, the Company accounts for stock-based compensation at
intrinsic value with disclosure of the effects of fair value accounting on net
income and earnings per share on a pro forma basis.
 
     Cash Flows:  For purposes of the Consolidated Statements of Cash Flows, the
Company considers all highly liquid instruments with a purchased maturity of
three months or less to be cash equivalents. The carrying amount of cash and
cash equivalents approximates fair value due to the short maturities.
 
     Environmental Matters:  The Company accrues for costs associated with the
remediation of environmental pollution when it is probable that a liability has
been incurred and the Company's proportionate share of the amount can be
reasonably estimated. Any recorded liabilities have not been discounted.
 
     Comprehensive Income:  In the first quarter of 1998, the Company adopted
the provisions of SFAS No. 130, Reporting Comprehensive Income, which
established standards for reporting and display of comprehensive income and its
components. Comprehensive income is the total of net income and all other
nonowner changes in stockholders' equity.
 
     Segments and Related Information:  In the fourth quarter of 1998, the
Company adopted the provisions of SFAS No. 131, Disclosures about Segments of an
Enterprise and Related Information. The statement established standards for the
way that public business enterprises report information and operating segments
in annual financial statements and requires reporting of selected information in
interim financial reports.
 
     Derivative Instruments and Hedging:  The Financial Accounting Standards
Board issued SFAS No. 137, Accounting for Derivative Instruments and Hedging
Activities -- Deferral of the Effective Date of SFAS No. 133, in June 1999. SFAS
No. 133 is now effective for all fiscal quarters of all fiscal years beginning
after June 15, 2000; earlier adoption is allowed. The statement requires
companies to record derivatives on the balance sheet as assets or liabilities,
measured at fair value. Gains or losses resulting from changes in the values of
those derivatives would be accounted for depending on the use of the derivative
and whether it qualifies for hedge accounting. The Company has not yet
determined the effect that adoption of SFAS No. 133 will have or when the
provisions of the statement will be adopted. However, the Company currently
expects that, due to its relatively limited use of derivative instruments, the
adoption of SFAS No. 133 will not have a material effect on the Company's
results of operations or financial position.
 
     Start-up Activities:  During 1998, the American Institute of Certified
Public Accountants issued Statement of Position 98-5, Reporting on the Costs of
Start-up Activities. This statement required a change in
 
                                       33

<PAGE>   35
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
the method of accounting for start-up costs on major projects to expense these
costs as incurred. Prior to this accounting change, these costs could be
capitalized. The impact of this accounting change did not have a material effect
on the Company's results of operations or financial position.
 
     Reclassifications:  Certain amounts from prior years have been reclassified
to conform to the 1999 financial statement presentation.
 
NOTE 2.  ACQUISITIONS
 
     On May 28, 1999, the Company completed its acquisition of the Analytical
Instruments Division (PEAI) of PE Corp. for an aggregate purchase price of
approximately $425 million, plus acquisition costs. In addition, under the terms
of the Purchase Agreement dated March 8, 1999 between the Company and PE Corp.
(the "Purchase Agreement"), the Company assumed German and other pension
liabilities of approximately $65 million. These pension liabilities were
historically funded on a pay-as-you go basis, and the funding going-forward is
expected to remain consistent. The acquisition was accounted for as a purchase
under APB Opinion No. 16, Business Combinations. In accordance with APB Opinion
No. 16, the Company allocated the purchase price of PEAI based on the fair
values of the net assets acquired and liabilities assumed. The allocation of the
purchase price has not yet been finalized, however, the Company does not expect
any material changes. The purchase price is subject to a post-closing adjustment
currently in negotiation which will be equal to the amount by which the audited
net assets of PEAI as of the closing date were greater or less than, as the case
may be, certain target amounts set forth in the Purchase Agreement. PEAI
produces high-quality analytical testing instruments and consumables, and
generated 1998 fiscal year sales of $569 million. PEAI's operations are reported
in the Company's Instruments segment.
 
     Portions of the purchase price, including intangible assets, were valued by
independent appraisers utilizing customary valuation procedures and techniques.
These intangible assets included approximately $23 million for acquired
in-process research and development (in-process R&D) for projects that did not
have future alternative uses. This allocation represents the estimated fair
value based on risk-adjusted cash flows related to the in-process R&D projects.
At the date of the acquisition of PEAI, the development of these projects had
not yet reached technological feasibility, and the R&D in process had no
alternative future uses. Accordingly, these costs were expensed in the second
quarter of 1999. Other acquired intangibles totaling $163.8 million included the
fair value of trade names, trademarks, patents and developed technology. These
intangibles are being amortized over their respective estimated useful lives
ranging from 10-40 years. Goodwill resulting from the acquisition of PEAI is
being amortized over 40 years. Approximately $28 million was recorded as accrued
restructuring charges in connection with the acquisition of PEAI. The
restructuring plans include initiatives to integrate the operations of the
Company and of PEAI, and reduce overhead. The primary components of these plans
relate to: (a) employee termination benefits and related costs for approximately
20% of the acquired workforce of approximately 3,000 employees; to date, the
Company has reduced PEAI's workforce by 230 individuals, (b) consolidation or
shutdown of certain operational facilities worldwide and (c) termination of
certain leases and other contractual obligations. While the Company does not
anticipate material changes at this time to its restructuring plans, management
is in the process of refining the restructuring plans and, accordingly, the
amounts recorded are based on management's current estimates of those costs. The
majority of the restructuring actions are expected to occur through fiscal 2000.
 
                                       34

<PAGE>   36
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     The components of the purchase price and allocation were as follows:
 

<TABLE>
<CAPTION>
                                                              (IN THOUSANDS)
                                                              --------------
<S>                                                           <C>
Consideration and acquisition costs:
  Cash paid.................................................    $ 275,000
  Seller note...............................................      150,000
  Pension liabilities assumed...............................       65,000
  Acquisition costs.........................................       10,000
                                                                ---------
                                                                $ 500,000
                                                                =========
Preliminary allocation of purchase price:
  Current assets............................................    $ 253,777
  Property, plant and equipment.............................       33,308
  Acquired intangibles......................................      163,800
  In-process R&D............................................       23,000
  Goodwill..................................................      175,064
  Liabilities assumed and other.............................     (148,949)
                                                                ---------
                                                                $ 500,000
                                                                =========
</TABLE>

 
     On December 16, 1998, the Company acquired substantially all of the
outstanding common stock and options of Lumen Technologies, Inc. (Lumen), a
maker of high-technology specialty light sources. The purchase price of
approximately $253 million, which included $75 million of assumed debt, was
funded with existing cash and commercial paper borrowings. The acquisition was
accounted for as a purchase under APB Opinion No. 16. In accordance with APB
Opinion No. 16, the Company allocated the purchase price of Lumen based on the
fair values of the assets acquired and liabilities assumed. Portions of the
purchase price, including intangible assets, were valued by independent
appraisers utilizing proven valuation procedures and techniques. These
intangible assets included approximately $2.3 million for acquired in-process
R&D for projects that did not have future alternative uses. This allocation
represents the estimated fair value based on risk-adjusted cash flows related to
the in-process R&D projects. At the date of the acquisition, the development of
these projects had not yet reached technological feasibility, and the R&D in
process had no alternative future uses. Accordingly, these costs were expensed
in the fourth quarter of 1998. Acquired intangibles totaling $11.8 million
included the fair value of trade names, trademarks and patents. These
intangibles are being amortized over their estimated useful life of ten years.
Goodwill resulting from the Lumen acquisition is being amortized over 30 years.
Approximately $5 million was recorded as accrued restructuring charges in
connection with the acquisition. The restructuring plans included initiatives to
integrate the operations of the Company and Lumen, and reduce overhead. The
primary components of these plans related to: (a) transfer of certain
manufacturing activities to lower-cost facilities, (b) integration of the sales
and marketing organization and (c) termination of certain contractual
obligations. The remaining restructuring actions are expected to occur in fiscal
2000. Lumen's operations were primarily reported in the Company's
Optoelectronics segment, with the photolithography business reported in the
Instruments segment, in 1999.
 
                                       35

<PAGE>   37
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     The components of the purchase price and allocation were as follows:
 

<TABLE>
<CAPTION>
                                                              (IN THOUSANDS)
                                                              --------------
<S>                                                           <C>
Consideration and acquisition costs:
  Cash paid for stock and options...........................     $168,050
  Debt assumed..............................................       74,388
  Fair value of options exchanged...........................        6,500
  Acquisition costs.........................................        3,925
                                                                 --------
                                                                 $252,863
                                                                 ========
Allocation of purchase price:
  Current assets............................................     $ 66,829
  Property, plant and equipment.............................       52,525
  Acquired intangibles......................................       11,800
  In-process R&D............................................        2,300
  Goodwill..................................................      164,900
  Liabilities assumed and other.............................      (45,491)
                                                                 --------
                                                                 $252,863
                                                                 ========
</TABLE>

 
     In December 1998, the Company acquired Life Science Resources Limited
(LSR), a U.K.-based developer and supplier of biotechnology, biomedical and
clinical research instrumentation, for $11 million. In April 1998, in connection
with the divestiture of the Sealol Industrial Seals division, the Company
purchased Belfab, the advanced metal bellows division of John Crane, Inc. for
$45 million in cash. In February 1998, the Company acquired Isolab, Inc., a
supplier of systems for clinical diagnostic screening, for $10 million. These
acquisitions were accounted for using the purchase method. The excess of the
cost over the fair market value of the net assets acquired totaled $54 million
and is being amortized over periods of 10-20 years using a straight-line method.
The results of operations of the acquisitions were included in the consolidated
results of the Company from the date of each respective acquisition.
 
     Unaudited pro forma operating results for the Company, assuming the
acquisitions of Lumen and PEAI occurred on December 29, 1997, are as follows:
 

<TABLE>
<CAPTION>
          (IN THOUSANDS EXCEPT PER SHARE DATA)               1999              1998
          ------------------------------------            ----------        ----------
<S>                                                       <C>               <C>
Sales from continuing operations........................  $1,577,963        $1,556,094
Income from continuing operations.......................      24,541            46,173
  Basic earnings per share..............................         .54              1.02
  Diluted earnings per share............................         .53              1.01
Net income..............................................     150,486            69,174
  Basic earnings per share..............................        3.31              1.53
  Diluted earnings per share............................        3.23              1.51
</TABLE>

 
     The pro forma amounts in the table above exclude the in-process R&D charges
of $23 million for PEAI and $2.3 million for Lumen. The unaudited pro forma
financial information is provided for informational purposes only and is not
necessarily indicative of the Company's operating results that would have
occurred had the acquisitions been consummated on the dates for which the
consummation of the acquisitions is being given effect, nor is it necessarily
indicative of the Company's future operating results. The pro forma amounts do
not reflect any operating efficiencies and cost savings that the Company
believes are achievable. Pro forma amounts for the other 1998 acquisitions are
not included as their effect is not material to the Company's consolidated
financial statements.
 
                                       36

<PAGE>   38
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
NOTE 3.  RESTRUCTURING AND INTEGRATION CHARGES
 
     In 1997, as part of a plan to reposition its operations, the Company
recorded $7.8 million of integration costs, which included $4.4 million related
to employee separation costs and $3.4 million related to its consolidation
effort. These costs were included in selling, general and administrative
expenses.
 
     The Company developed restructuring plans during 1998 to integrate and
consolidate its businesses and recorded restructuring charges in the first and
second quarters of 1998, which are discussed separately below.
 
     During the first quarter of 1998, management developed a plan to
restructure certain businesses. A discussion of the businesses affected within
each segment is presented below. The plan resulted in pre-tax restructuring
charges totaling $30.5 million. The principal actions in the restructuring plan
included close-down or consolidation of a number of offices and facilities,
transfer of assembly activities to lower-cost geographic locations, disposal of
underutilized assets, withdrawal from certain product lines and general cost
reductions.
 
     Further details of the actions are presented below. Specific businesses
within each segment which were affected by the restructuring actions are as
follows: the Fluid Sciences business affected primarily manufactures mechanical
components and systems; the Optoelectronics businesses affected produce various
lighting and sensor components and systems; the Instruments restructuring
related primarily to its X-ray imaging business which produces security
screening equipment, as well as its Instruments for Research and Applied Science
business which produces particle detector equipment.
 
     Close-down of certain facilities:  Costs have been accrued for the closing
down of facilities. These costs related to the affected businesses discussed
above within the Fluid Sciences and Optoelectronics segments.
 
     Transfer of assembly activities:  The Company plans to relocate certain
activities, primarily in its Optoelectronics segment, to lower-cost geographic
areas such as Indonesia and China. The costs included in the restructuring
charges related to costs associated with exiting the previous operations. Actual
costs to physically relocate are charged to operations as incurred.
 
     Disposal of underutilized assets:  The Company plans to dispose of
underutilized assets either through sale or abandonment, primarily in its
Instruments and Optoelectronics segments.
 
     Withdrawal from certain product lines:  The Company has made a strategic
decision to discontinued certain unprofitable product lines discussed above,
primarily in its Instruments and Optoelectronics segments.
 
     During the second quarter of 1998, the Company expanded its continuing
effort to restructure certain businesses to further improve performance. The
plan resulted in additional pre-tax restructuring charges of $19.5 million. The
principal actions in this restructuring plan included the integration of
operating divisions into five strategic business units (SBUs), close-down or
consolidation of a number of production facilities and general cost reductions.
As discussed in Note 8, the Company has since divested its Technical Services
segment. Pre-tax restructuring charges of $4.5 million were charged to
discontinued operations in 1998 ($0.9 million in the first quarter and $3.6
million in the second quarter), primarily related to severance benefits, all of
which have been incurred as of January 2, 2000.
 
     As part of the Company's second quarter restructuring plan, management
reorganized its operating divisions into five SBUs. This resulted in termination
of employees as well as the integration and consolidation of certain facilities
and product lines. This effort is company-wide and affects all segments of the
Company. The major components within the Optoelectronics plan consisted of the
closing of two wafer fab production facilities and a development program.
 
     The total restructuring charges in 1998 included $9.9 million for
termination of leases and other contractual obligations. This amount included
approximately $6.5 million for termination of facility leases and other
lease-related costs, $1.5 million for termination of distributor arrangements
and $1.9 million for various
 
                                       37

<PAGE>   39
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
other commitments. The facility leases have remaining terms ranging from six
months to five years. The amount accrued reflects the Company's best estimate of
actual costs to buy out the leases in certain cases or the net cost to sublease
the properties in other cases.
 
     The restructuring charges related to continuing operations recorded in the
first and second quarters of 1998 were broken down as follows by operating
segment:
 

<TABLE>
<CAPTION>
                                                                        TERMINATION OF
                                                     DISPOSAL OF       LEASES AND OTHER
                                   EMPLOYEE        CERTAIN PRODUCTS      CONTRACTUAL
        (IN MILLIONS)          SEPARATION COSTS    LINES AND ASSETS      OBLIGATIONS       TOTAL
        -------------          ----------------    ----------------    ----------------    ------
<S>                            <C>                 <C>                 <C>                 <C>
Life Sciences................       $ 3.6               $   .4              $  .6          $  4.6
Optoelectronics..............         8.5                  6.4                5.4            20.3
Instruments..................         6.4                  2.9                2.0            11.3
Fluid Sciences...............         6.2                  1.9                1.8             9.9
Corporate and Other..........         3.8                   --                 .1             3.9
                                    -----               ------              -----          ------
Total restructuring
  charges....................        28.5                 11.6                9.9            50.0
Amounts incurred through
  January 3, 1999............        (8.1)               (11.6)              (1.0)          (20.7)
                                    -----               ------              -----          ------
Accrued restructuring costs
  at January 3, 1999.........        20.4                   --                8.9            29.3
Amounts incurred during
  1999.......................        (8.3)                  --               (2.6)          (10.9)
Amounts reversed during
  1999.......................        (7.4)                  --               (4.6)          (12.0)
                                    -----               ------              -----          ------
Accrued restructuring costs
  at January 2, 2000.........       $ 4.7               $   --              $ 1.7          $  6.4
                                    =====               ======              =====          ======
</TABLE>

 
     The headcount reduction, by function, resulting in the Employee Separation
Costs detailed above is as follows (after amounts reversed during 1999):
 

<TABLE>
<CAPTION>
                                         FIRST QUARTER PLAN    SECOND QUARTER PLAN     TOTAL
                                         ------------------    -------------------    --------
<S>                                      <C>                   <C>                    <C>
Sales and Marketing....................          34                     39                  73
Production.............................         197                     70                 267
General & Administrative...............          34                     82                 116
                                                ---                    ---            --------
Total..................................         265                    191                 456
                                                ===                    ===            ========
</TABLE>

 
     Approximately 60% of the total employees expected to be terminated have
been severed as of January 2, 2000.
 
     The remaining accrual at January 2, 2000 for the 1998 restructuring plans
consisted of the following amounts: Life Sciences -- $.5 million;
Optoelectronics -- $4.9 million; Fluid Sciences -- $.1 million; Corporate and
Other -- $.9 million. The amounts represent the estimated costs to complete
restructuring actions currently in process and are expected to be incurred
during fiscal 2000.
 
     The components of the restructuring charges met the criteria set forth in
Emerging Issues Task Force Issue 94-3, Liability Recognition for Certain
Employee Termination Benefits and Other Costs to Exit an Activity (Including
Certain Costs Incurred in a Restructuring). The charges do not include
additional costs associated with the restructuring plans, such as training,
consulting, purchase of equipment and relocation of employees and equipment.
These costs were charged to operations or capitalized, as appropriate, when
incurred.
 
                                       38

<PAGE>   40
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     During the third quarter of 1999, due to the substantial completion of the
actions of the 1998 restructuring plans, the Company reevaluated its 1998
restructuring plans. As a result of this review, costs associated with the
previously planned shutdown of two businesses were no longer required due to
actions taken to improve performance. As a result of these recent developments,
the Company recognized a restructuring credit of $12 million during the third
quarter of 1999, which primarily affected the Fluid Sciences and Optoelectronics
segments. The $12 million credit is reflected in "Restructuring Charges, Net" in
the Consolidated Income Statements.
 
     The acquisitions by the Company discussed in Note 2 and the Company's
divestiture during the third quarter of 1999 of its Technical Services segment
discussed in Note 8 (exiting government services) were strategic milestones in
the Company's transition to a commercial high-technology company. Consistent
with the strategic direction of the Company and concurrent with the reevaluation
of existing restructuring plans during the third quarter of 1999, the Company
developed additional plans during the third quarter of 1999 to restructure
certain businesses to continue to improve the Company's performance.
 
     These plans resulted in a pre-tax restructuring charge of $23.5 million
recorded in the third quarter of 1999. The principal actions in these
restructuring plans include close-down or consolidation of a number of offices
and facilities, transfer of assembly activities to lower-cost geographic
locations, disposal of underutilized assets, withdrawal from certain product
lines and general cost reductions. The restructuring plans are expected to
result in the elimination of approximately 400 positions, primarily in the
manufacturing and sales categories. The major components of the restructuring
charge were $13.6 million of employee separation costs to restructure the
worldwide organization, including the sales and manufacturing focus, $2.3
million of noncash charges to dispose of certain product lines and assets
through sale or abandonment and $7.6 million of charges to terminate lease and
other contractual obligations no longer required as a result of the
restructuring plans. The charges do not include additional costs associated with
the restructuring plans, such as training, consulting, purchase of equipment and
relocation of employees and equipment. These costs will be charged to operations
or capitalized, as appropriate, when incurred.
 
     The restructuring actions related to the 1999 charge are broken down as
follows by business segment:
 

<TABLE>
<CAPTION>
                                                                          TERMINATION OF
                                                  DISPOSAL OF CERTAIN    LEASES AND OTHER
                                  EMPLOYEE              PRODUCT            CONTRACTUAL
       (IN MILLIONS)          SEPARATION COSTS     LINES AND ASSETS        OBLIGATIONS       TOTAL
       -------------          ----------------    -------------------    ----------------    -----
<S>                           <C>                 <C>                    <C>                 <C>
Life Sciences...............       $  .5                 $ .8                  $4.9          $ 6.2
Optoelectronics.............         6.1                   .8                   2.1            9.0
Instruments.................         1.8                   --                    --            1.8
Fluid Sciences..............         5.2                   .2                    .1            5.5
Corporate and Other.........          --                   .5                    .5            1.0
                                   -----                 ----                  ----          -----
Total restructuring
  charge....................        13.6                  2.3                   7.6           23.5
Amounts incurred through
  January 2, 2000...........        (2.1)                 (.2)                  (.4)          (2.7)
                                   -----                 ----                  ----          -----
Accrued restructuring costs
  at January 2, 2000........       $11.5                 $2.1                  $7.2          $20.8
                                   =====                 ====                  ====          =====
</TABLE>

 
     Further details of the Company's restructuring actions are presented below.
Specific businesses within each segment which were affected by the restructuring
actions are as follows: the primary Fluid Sciences business affected
manufactures certain products for the aerospace markets; the Optoelectronics
businesses affected produce various lighting and sensor components and systems;
the Instruments restructuring relates to its analytical instruments business,
its X-ray imaging business which produces security screening equipment, and its
Instruments for Research and Applied Science business which produces particle
detector equipment.
 
                                       39

<PAGE>   41
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     Close-down of certain facilities:  Costs have been accrued for the closing
down of certain facilities. These costs relate primarily to the Instruments and
Optoelectronics segments.
 
     Transfer of assembly activities:  The Company continues to relocate certain
activities, primarily in its Optoelectronics segment, to lower-cost geographic
areas, such as the Philippines, Indonesia and China. The costs included in the
restructuring charges related to costs associated with exiting the previous
operations. Actual costs to physically relocate are charged to operations as
incurred.
 
     Disposal of underutilized assets:  The Company plans to dispose of
underutilized assets either through sale or abandonment, primarily in its
Instruments and Optoelectronics segments.
 
     Withdrawal from certain product lines:  The Company has made a strategic
decision to discontinue certain unprofitable product lines, primarily in its
Optoelectronics segment.
 
     Most of the actions remaining at January 2, 2000 are expected to occur in
fiscal 2000.
 
     The following table summarizes reserve activity through January 2, 2000
related to the May 1999 PEAI acquisition as discussed in Note 2:
 

<TABLE>
<CAPTION>
                                                               TERMINATION OF LEASES
                                               EMPLOYEE        AND OTHER CONTRACTUAL
              (IN MILLIONS)                SEPARATION COSTS         OBLIGATIONS          TOTAL
              -------------                ----------------    ----------------------    -----
<S>                                        <C>                 <C>                       <C>
Accrued restructuring costs at
  acquisition date.......................       $ 23.5                 $ 4.7             $28.2
Charges/writeoffs........................        (14.1)                 (1.7)            (15.8)
                                                ------                 -----             -----
Accrued restructuring costs at January 2,
  2000...................................       $  9.4                 $ 3.0             $12.4
                                                ======                 =====             =====
</TABLE>

 
     The following table summarizes reserve activity through January 2, 2000
related to the December 1998 Lumen acquisition as discussed in Note 2 (there was
no activity during 1998):
 

<TABLE>
<CAPTION>
                                                                          TERMINATION OF
                                                  DISPOSAL OF CERTAIN    LEASES AND OTHER
                                  EMPLOYEE              PRODUCT            CONTRACTUAL
       (IN MILLIONS)          SEPARATION COSTS     LINES AND ASSETS        OBLIGATIONS       TOTAL
       -------------          ----------------    -------------------    ----------------    -----
<S>                           <C>                 <C>                    <C>                 <C>
Accrued restructuring costs
  at acquisition date.......        $1.1                 $ 2.0                $ 1.9          $ 5.0
Charges/writeoffs...........         (.3)                 (1.1)                (1.9)          (3.3)
                                    ----                 -----                -----          -----
Accrued restructuring costs
  at January 2, 2000........        $ .8                 $  .9                $  --          $ 1.7
                                    ====                 =====                =====          =====
</TABLE>

 
     The following table summarizes restructuring activity from continuing
operations for the two years ended January 2, 2000:
 

<TABLE>
<CAPTION>
                       (IN THOUSANDS)                           1999        1998
                       --------------                         --------    --------
<S>                                                           <C>         <C>
Accrued restructuring costs at beginning of year............  $ 34,569    $  3,025
Provisions:
  Operations................................................    23,500      50,027
  Acquisitions..............................................    28,195       5,000
Charges/writeoffs...........................................   (32,525)    (23,483)
Reversals...................................................   (11,980)         --
                                                              --------    --------
Accrued restructuring costs at end of year..................  $ 41,759    $ 34,569
                                                              ========    ========
</TABLE>

 
                                       40

<PAGE>   42
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     Cash outlays during 1999 and 1998 were $32.5 million and $23.5 million,
respectively, for all of these plans. The Company expects to incur approximately
$25-$30 million of cash outlays in connection with these plans throughout fiscal
2000.
 
NOTE 4.  ASSET IMPAIRMENT CHARGES
 
     During the third quarter of 1999, in connection with its ongoing review of
its portfolio of businesses, the Company conducted a strategic review of certain
units within its business segments. The strategic review triggered an impairment
review of long-lived assets of certain business units that are expected to be
disposed. The Company calculated the present value of expected cash flows of
certain business units to determine the fair value of those assets. Accordingly,
in the third quarter of 1999, the Company recorded noncash impairment charges
and wrote down goodwill by $15 million in the Instruments segment and $3 million
in the Optoelectronics segment. Sales and operating profit for the businesses
under strategic review were approximately $54 million and $2 million,
respectively, in 1999.
 
     During the second quarter of 1998, the Company recorded a $7.4 million
noncash impairment charge related to an automotive testing facility in the
Instruments segment. The impairment charge applied to fixed assets and resulted
from projected changes in the principal customer's demand for services. The
Company calculated the present value of expected cash flows of the testing
facility to determine the fair value of the assets.
 
     During the second quarter of 1997, the Company recorded a noncash
impairment charge of $28.2 million, with $26.7 million related to IC Sensors in
the Optoelectronics segment and $1.5 million related to the goodwill of an
environmental services business in Other. As a result of IC Sensors' inability
to achieve the improvements specified in its corrective action plan, it
continued operating at a loss in the second quarter of 1997, triggering an
impairment review of its long-lived assets. A revised operating plan was
developed to restructure and stabilize the business. The revised projections by
product line provided the basis for measurement of the asset impairment charge.
The Company calculated the present value of expected cash flows of IC Sensors'
product lines to determine the fair value of the assets. Accordingly, in the
second quarter of 1997, the Company recorded an impairment charge of $26.7
million, for a write-down of goodwill of $13.6 million and fixed assets of $13.1
million. The components of the revised operating plan included hiring a new
general manager, transferring assembly and test operations to a lower-cost
environment (Batam, Indonesia), introducing new products and reviewing
manufacturing processes to improve production yields. All of these components
were implemented during 1997 and 1998. In February 2000, the Company sold its IC
Sensors business. The Company does not expect a material gain or loss on
disposition.
 
NOTE 5.  GAINS ON DISPOSITIONS
 
     During the second quarter of 1999, the Company sold its Structural
Kinematics business for cash of $15 million, resulting in a pre-tax gain of $4.3
million, and $.06 per diluted share after-tax. Additionally, as a result of the
Company's continuing evaluation of its Instruments businesses, the Company
undertook certain repositioning actions during the second quarter of 1999,
including exiting selected product lines and activities, rebalancing its
customer mix in certain businesses and other related activities. These actions
resulted in second quarter pre-tax charges of approximately $3.4 million,
primarily recorded in cost of sales. During the fourth quarter of 1999, the
Company sold its KT Aerofab business for cash of $4.4 million, resulting in a
pre-tax gain of $0.3 million. The net operating results of the divested
businesses for 1999 were not significant.
 
     In April 1998, the Company sold its Sealol Industrial Seals division for
cash of $100 million, resulting in a pre-tax gain of $58.3 million. The
after-tax gain of this divestiture was $42.6 million, or $.93 diluted earnings
per share. Sealol's 1998 sales prior to the disposition were $23 million, and
its operating income was $2.1 million ($.04 diluted earnings per share). Sealol
had 1997 sales of $88 million and operating income of $11.4 million ($.21
diluted earnings per share). In January 1998, the Company sold its Rotron
division for $103
 
                                       41

<PAGE>   43
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
million in cash, resulting in a pre-tax gain of $64.4 million. During the first
quarter of 1998, the Company also sold a small product line for $4 million in
cash, resulting in a pre-tax gain of $3.1 million. The after-tax gain of these
divestitures was $45.2 million, or $.99 diluted earnings per share in 1998.
Rotron had 1997 sales of $70 million and operating income of $11.9 million ($.16
diluted earnings per share). During 1999, in connection with the 1998
dispositions of the Company's Rotron and Sealol Industrial Seals divisions, the
Company recognized approximately $13.2 million of pre-tax gains from the
previously deferred sales proceeds as a result of the favorable resolution of
certain events and contingencies. These gains are reported on the "Gains on
Dispositions" line in the Consolidated Income Statements.
 
     In 1997, the Company sold its Chandler, Flow and Birtcher divisions for $23
million, resulting in pre-tax gains of $10.6 million. These gains were recorded
in selling, general and administrative expenses.
 
NOTE 6. OTHER EXPENSE
 
     Other income (expense), net, consisted of the following:
 

<TABLE>
<CAPTION>
                  (IN THOUSANDS)                       1999        1998        1997
                  --------------                     --------    --------    --------
<S>                                                  <C>         <C>         <C>
Interest income....................................  $  3,365    $  6,873    $  1,969
Interest expense...................................   (28,284)    (11,391)    (12,482)
Gains on sales of investments, net.................     1,952       4,465         711
Other..............................................     1,185      (1,344)      2,247
                                                     --------    --------    --------
                                                     $(21,782)   $ (1,397)   $ (7,555)
                                                     ========    ========    ========
</TABLE>

 
     Other consists mainly of foreign exchange losses, $2.2 million of income
received by the Company in 1999 related to the demutualization of a life
insurance company in which the Company is a policyholder and a $3.4 million cost
of capital reimbursement in 1997 relating to a joint development program (see
Note 18).
 
NOTE 7. INCOME TAXES
 
     The components of income from continuing operations before income taxes for
financial reporting purposes were as follows:
 

<TABLE>
<CAPTION>
                   (IN THOUSANDS)                      1999        1998        1997
                   --------------                     -------    --------    --------
<S>                                                   <C>        <C>         <C>
U.S.................................................  $ 1,044    $ 26,664    $(22,483)
Non-U.S.............................................   43,826      91,663      41,947
                                                      -------    --------    --------
                                                      $44,870    $118,327    $ 19,464
                                                      =======    ========    ========
</TABLE>

 
                                       42

<PAGE>   44
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     The components of the provision for income taxes for continuing operations
were as follows:
 

<TABLE>
<CAPTION>
                                                                  DEFERRED
                   (IN THOUSANDS)                      CURRENT    (PREPAID)     TOTAL
                   --------------                      -------    ---------    -------
<S>                                                    <C>        <C>          <C>
1999
  Federal............................................  $ 9,397    $ (5,436)    $ 3,961
  State..............................................      921        (621)        300
  Non-U.S............................................   13,052        (814)     12,238
                                                       -------    --------     -------
                                                       $23,370    $ (6,871)    $16,499
                                                       =======    ========     =======
1998
  Federal............................................  $32,067    $ (7,538)    $24,529
  State..............................................    3,802        (977)      2,825
  Non-U.S............................................   15,951      (3,979)     11,972
                                                       -------    --------     -------
                                                       $51,820    $(12,494)    $39,326
                                                       =======    ========     =======
1997
  Federal............................................  $ 4,460    $ (5,805)    $(1,345)
  State..............................................    2,168        (144)      2,024
  Non-U.S............................................    7,028       2,195       9,223
                                                       -------    --------     -------
                                                       $13,656    $ (3,754)    $ 9,902
                                                       =======    ========     =======
</TABLE>

 
     The total provision for income taxes included in the consolidated financial
statements was as follows:
 

<TABLE>
<CAPTION>
                    (IN THOUSANDS)                                  1999       1998
                    --------------                                 -------    -------
<S>                                                     <C>        <C>        <C>
Continuing operations.................................  $16,499    $39,326    $ 9,902
Discontinued operations...............................   80,522     14,706     15,119
                                                        -------    -------    -------
                                                        $97,021    $54,032    $25,021
                                                        =======    =======    =======
</TABLE>

 
     The major differences between the Company's effective tax rate for
continuing operations and the federal statutory rate were as follows:
 

<TABLE>
<CAPTION>
                                                              1999     1998     1997
                                                              -----    -----    -----
<S>                                                           <C>      <C>      <C>
Federal statutory rate......................................   35.0%    35.0%    35.0%
Non-U.S. rate differential, net.............................  (18.0)   (19.0)   (39.4)
Future remittance of non-U.S. earnings......................     --      8.4       --
State income taxes, net.....................................    1.4      1.6      4.1
Goodwill amortization.......................................    7.6       .6      9.2
Goodwill write-downs........................................   11.7       --     27.0
Change in valuation allowance...............................    9.0      2.0     15.3
Other, net..................................................   (9.9)     4.6     (0.3)
                                                              -----    -----    -----
Effective tax rate..........................................   36.8%    33.2%    50.9%
                                                              =====    =====    =====
</TABLE>

 
     The 1999 and 1997 tax provisions and effective rates for continuing
operations were impacted by non-deductible goodwill write-downs. Excluding the
impairment charges and related tax effects, the effective tax rates were 32% in
1999 and 30.6% in 1997.
 
                                       43

<PAGE>   45
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     The tax effects of temporary differences and carryforwards which gave rise
to deferred income tax assets and liabilities as of January 2, 2000 and January
3, 1999 were as follows:
 

<TABLE>
<CAPTION>
                       (IN THOUSANDS)                           1999        1998
                       --------------                         --------    --------
<S>                                                           <C>         <C>
Deferred tax assets:
  Inventory reserves........................................  $  7,042    $  7,510
  Other reserves............................................    16,417      17,828
  Deferred income...........................................     6,024       5,286
  Vacation pay..............................................     5,499       1,760
  Net operating loss carryforwards..........................    28,562      35,349
  Postretirement health benefits............................     4,072       4,420
  Restructuring reserve.....................................    15,567      16,600
  In-process R&D............................................     8,970          --
  All other, net............................................    50,138      38,797
                                                              --------    --------
Total deferred tax assets...................................   142,291     127,550
                                                              --------    --------
Deferred tax liabilities:
  Pension contribution......................................   (13,354)    (12,555)
  Amortization..............................................      (468)     (1,143)
  Depreciation..............................................   (19,661)    (10,819)
  All other, net............................................   (20,748)    (25,572)
                                                              --------    --------
Total deferred tax liabilities..............................   (54,231)    (50,089)
                                                              --------    --------
Valuation allowance.........................................   (28,580)    (32,628)
                                                              --------    --------
Net prepaid taxes...........................................  $ 59,480    $ 44,833
                                                              ========    ========
</TABLE>

 
     At January 2, 2000, the Company had non-U.S. (primarily from Germany) net
operating loss carryforwards of $65.2 million, substantially all of which carry
forward indefinitely. The $25.6 million valuation allowance results primarily
from these carryforwards, for which the Company currently believes it is more
likely than not that they will not be realized.
 
     Current deferred tax assets of $92 million and $82.3 million were included
in other current assets at January 2, 2000 and January 3, 1999, respectively.
Long-term deferred tax liabilities of $33 million and $32.5 million were
included in long-term liabilities at January 2, 2000 and January 3, 1999,
respectively. These amounts included approximately $8.3 million of current
deferred tax assets and $3.3 million of long-term deferred tax liabilities
related to the discontinued operations of the Technical Services segment at
January 3, 1999.
 
     In general, it is the practice and intention of the Company to reinvest the
earnings of its non-U.S. subsidiaries in those operations. Repatriation of
retained earnings is done only when it is advantageous. Applicable federal taxes
are provided only on amounts planned to be remitted. In connection with 1998
divestitures, certain proceeds will not be permanently reinvested in those
operations, and, accordingly, federal taxes in the amount of $10 million were
provided in connection with those earnings. Accumulated net earnings of non-U.S.
subsidiaries for which no federal taxes have been provided as of January 2, 2000
were $99.9 million, which does not include amounts that, if remitted, would
result in little or no additional tax because of the availability of U.S. tax
credits for non-U.S. taxes. Federal taxes that would be payable upon remittance
of these earnings are estimated to be $32.9 million at January 2, 2000.
 
                                       44

<PAGE>   46
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
NOTE 8. DISCONTINUED OPERATIONS
 
     On August 20, 1999, the Company sold the assets of its Technical Services
segment, including the outstanding capital stock of EG&G Defense Materials,
Inc., a subsidiary of the Company, to EG&G Technical Services, Inc., an
affiliate of The Carlyle Group L.P. (the "Buyer"), for approximately $250
million in cash and the assumption by the Buyer of certain liabilities of the
Technical Services segment. Approximately $2.1 million of the cash purchase
price will be paid by the Buyer to the Company on the seventh anniversary of the
closing of this transaction. The purchase price is subject to a post-closing
adjustment based on the Technical Services segment's working capital, as
defined, currently being arbitrated by the parties.
 
     The results of operations of the Technical Services segment were previously
reported as one of five business segments of the Company. The Company accounted
for the sale of its Technical Services segment as a discontinued operation in
accordance with APB Opinion No. 30 and, accordingly, the results of operations
of the Technical Services segment have been segregated from continuing
operations and reported as a separate line item on the Company's Consolidated
Income Statements. The Company recorded a pre-tax gain on disposition of
discontinued operations of $181 million, net of transaction and related costs,
during 1999. The $110 million after-tax gain was reported separately from the
results of the Company's continuing operations.
 
     The Company's former Department of Energy (DOE) segment is also presented
as discontinued operations in accordance with APB Opinion No. 30. The Company's
last DOE management and operations contract expired in 1997. The Company is in
the process of negotiating contract closeouts and does not anticipate incurring
any material loss in excess of previously established reserves.
 
     Summary operating results of the discontinued operations (through August
20, 1999) were as follows:
 

<TABLE>
<CAPTION>
                  (IN THOUSANDS)                       1999        1998        1997
                  --------------                     --------    --------    --------
<S>                                                  <C>         <C>         <C>
Sales..............................................  $302,776    $553,514    $613,118
Costs and expenses.................................   278,242     517,762     575,852
                                                     --------    --------    --------
Operating income from discontinued operations......    24,534      35,752      37,266
Other income.......................................     1,147       1,955       1,983
                                                     --------    --------    --------
Income from discontinued operations before income
  taxes............................................    25,681      37,707      39,249
Provision for income taxes.........................    10,016      14,706      15,119
                                                     --------    --------    --------
Income from discontinued operations, net of income
  taxes............................................  $ 15,665    $ 23,001    $ 24,130
                                                     ========    ========    ========
</TABLE>

 
     Income from discontinued operations, net of income taxes, of $15.7 million
in 1999 and $23 million in 1998 reflected the results of the Company's Technical
Services segment. Income from discontinued operations, net of income taxes, of
$24.1 million in 1997 reflected $21.1 million from the Company's Technical
Services segment and $3 million related to the Company's former DOE segment.
Sales for the Technical Services segment for fiscal 1999, 1998 and 1997 were
$303 million, $554 million and $533 million, respectively. The remaining sales
for 1997 in the preceding chart relate to the DOE segment.
 
NOTE 9. EARNINGS PER SHARE
 
     Basic earnings per share was computed by dividing net income by the
weighted-average number of common shares outstanding during the year. Diluted
earnings per share was computed by dividing net income by the weighted-average
number of common shares outstanding plus all potentially dilutive common shares
 
                                       45

<PAGE>   47
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
outstanding, primarily shares issuable upon the exercise of stock options using
the treasury stock method. The following table reconciles the number of shares
utilized in the earnings per share calculations:
 

<TABLE>
<CAPTION>
                     (IN THOUSANDS)                         1999      1998      1997
                     --------------                        ------    ------    ------
<S>                                                        <C>       <C>       <C>
Number of common shares-basic............................  45,522    45,322    45,757
Effect of dilutive securities:
  Stock options..........................................   1,015       516       141
  Other..................................................      32        46        --
                                                           ------    ------    ------
Number of common shares-diluted..........................  46,569    45,884    45,898
                                                           ======    ======    ======
</TABLE>

 
     Options to purchase 92,000 and 1,477,000 shares of common stock were not
included in the computation of diluted earnings per share for 1998 and 1997,
respectively, because the options' exercise prices were greater than the average
market price of the common shares and thus their effect would have been
antidilutive.
 
NOTE 10. ACCOUNTS RECEIVABLE
 
     Accounts receivable were net of reserves for doubtful accounts of $12.9
million and $4.4 million as of January 2, 2000 and January 3, 1999,
respectively. The increase is primarily due to the acquisition of PEAI ($6.5
million).
 
NOTE 11. INVENTORIES
 
     Inventories as of January 2, 2000 and January 3, 1999 consisted of the
following:
 

<TABLE>
<CAPTION>
                       (IN THOUSANDS)                           1999        1998
                       --------------                         --------    --------
<S>                                                           <C>         <C>
Finished goods..............................................  $ 87,177    $ 36,552
Work in process.............................................    26,342      22,124
Raw materials...............................................    88,205      64,892
                                                              --------    --------
                                                              $201,724    $123,568
                                                              ========    ========
</TABLE>

 
     The increase in inventories was primarily due to the acquisition of PEAI in
1999. The acquisition of PEAI also caused the portion of total inventories
accounted for using the LIFO method to drop from 12% in 1998 to 8% in 1999. The
excess of current cost of inventories over the LIFO value was approximately $5
million as of January 2, 2000 and January 3, 1999.
 
NOTE 12. PROPERTY, PLANT AND EQUIPMENT
 
     Property, plant and equipment, at cost, as of January 2, 2000 and January
3, 1999 consisted of the following:
 

<TABLE>
<CAPTION>
                       (IN THOUSANDS)                           1999        1998
                       --------------                         --------    --------
<S>                                                           <C>         <C>
Land........................................................  $ 28,724    $ 23,884
Buildings and leasehold improvements........................   127,908     128,900
Machinery and equipment.....................................   339,715     338,863
                                                              --------    --------
                                                              $496,347    $491,647
                                                              ========    ========
</TABLE>

 
     Increases in property, plant and equipment due to the acquisition of PEAI
($33 million) and capital expenditures ($41 million) were partially offset by
decreases resulting from dispositions ($54 million) and the effect of
translating fixed assets denominated in non-U.S. currencies at current exchange
rates.
 
                                       46

<PAGE>   48
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
NOTE 13. INVESTMENTS
 
     Investments as of January 2, 2000 and January 3, 1999 consisted of the
following:
 

<TABLE>
<CAPTION>
                       (IN THOUSANDS)                          1999       1998
                       --------------                         -------    -------
<S>                                                           <C>        <C>
Marketable investments......................................  $11,082    $10,695
Joint venture investments...................................    3,829      2,811
                                                              -------    -------
                                                              $14,911    $13,506
                                                              =======    =======
</TABLE>

 
     Joint venture investments are accounted for using the equity method.
Marketable investments consisted mainly of trust assets which were carried at
market value and were primarily invested in common stocks and fixed-income
securities to meet the supplemental executive retirement plan obligation. The
market values were based on quoted market prices. As of January 2, 2000, the
fixed-income securities, on average, had maturities of approximately 15 years.
The net unrealized holding gain on marketable investments, net of deferred
income taxes, reported as a component of accumulated other comprehensive income
(loss) in stockholders' equity, was $0.4 million at January 2, 2000 and January
3, 1999.
 
     Marketable investments classified as available for sale as of January 2,
2000 and January 3, 1999 consisted of the following:
 

<TABLE>
<CAPTION>
                                                                       GROSS UNREALIZED
                                                                            HOLDING
                                                 MARKET                -----------------
                (IN THOUSANDS)                    VALUE      COST      GAINS    (LOSSES)
                --------------                   -------    -------    -----    --------
<S>                                              <C>        <C>        <C>      <C>
1999
  Common stocks................................  $ 7,046    $ 6,345    $721      $ (20)
  Fixed-income securities......................    3,360      3,449      --        (89)
  Other........................................      676        652      24         --
                                                 -------    -------    ----      -----
                                                 $11,082    $10,446    $745      $(109)
                                                 =======    =======    ====      =====
1998
  Common stocks................................  $ 6,838    $ 6,367    $633      $(162)
  Fixed-income securities......................    3,549      3,506      43         --
  Other........................................      308        281      27         --
                                                 -------    -------    ----      -----
                                                 $10,695    $10,154    $703      $(162)
                                                 =======    =======    ====      =====
</TABLE>

 
NOTE 14. INTANGIBLE ASSETS
 
     Intangible assets consist mainly of goodwill from acquisitions accounted
for using the purchase method of accounting, representing the excess of cost
over the fair market value of the net assets of the acquired businesses.
Goodwill is being amortized over periods of 10-40 years. Goodwill, net of
accumulated amortization, was $417 million and $301 million at January 2, 2000
and January 3, 1999, respectively. Other identifiable intangible assets from
acquisitions include patents, trademarks, trade names and developed technology
and are being amortized over periods of 10-40 years. Other identifiable
intangible assets, net of
 
                                       47

<PAGE>   49
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
accumulated amortization, were $175 million and $17 million at January 2, 2000
and January 3, 1999, respectively. Intangible assets as of January 2, 2000 and
January 3, 1999 consisted of the following:
 

<TABLE>
<CAPTION>
                       (IN THOUSANDS)                           1999        1998
                       --------------                         --------    --------
<S>                                                           <C>         <C>
Goodwill....................................................  $477,072    $351,130
Other identifiable intangible assets........................   182,550      17,929
                                                              --------    --------
                                                               659,622     369,059
Accumulated amortization....................................   (67,184)    (51,448)
                                                              --------    --------
                                                              $592,438    $317,611
                                                              ========    ========
</TABLE>

 
     The increase in intangible assets resulted primarily from the acquisition
of PEAI.
 
NOTE 15. DEBT
 
     Short-term debt at January 2, 2000 was $382 million and included one-year
secured promissory notes of $150 million issued to PE Corp. at an interest rate
of 5%, money market loans of $85 million with Chase Securities, Inc. and
commercial paper borrowings of $140 million. The weighted-average interest rate
on the money market loans, which had maturities of 90 days or less, was 6.7%.
The weighted-average interest rate on the commercial paper borrowings, which had
maturities of 120 days or less, was 6.5%. Commercial paper borrowings averaged
$210 million during 1999 at an average interest rate of 5.5%. Short-term debt at
January 3, 1999 was $158 million and consisted primarily of commercial paper
borrowings of $150 million, at a weighted-average interest rate of 5.4%, that
had maturities of 60 days or less. Commercial paper borrowings averaged $23
million during 1998 at an average interest rate of 5.5%. At January 3, 1999,
short-term debt also included $6.2 million outstanding under a revolving credit
agreement, bearing interest at 9%, assumed by the Company in connection with the
Lumen acquisition. This amount was paid off in the first quarter of 1999.
 
     In March 2000, the Company's $250 million revolving credit facility was
refinanced and increased to a $300 million revolving credit facility that
expires in March 2001. The Company has an additional revolving credit agreement
for $100 million that expires in March 2002. These agreements, which serve as
backup facilities for the commercial paper borrowings, have no significant
commitment fees. The Company did not draw down its credit facilities during
1999.
 
     At January 2, 2000 and January 3, 1999, long-term debt included $115
million of unsecured ten-year notes issued in October 1995 at an interest rate
of 6.8%, which mature in 2005. The carrying amount approximated the estimated
fair value at January 2, 2000 and January 3, 1999 based on a quoted market
price. At January 3, 1999, long-term debt also included $14.8 million assumed by
the Company in connection with the Lumen acquisition, consisting of unsecured
notes of $12.4 million at 8% due in 2002 and a $2.4 million term loan at prime
plus 1.75% due in 2000. The unsecured notes and the loan were retired during
1999.
 
NOTE 16. ACCRUED EXPENSES
 
     Accrued expenses as of January 2, 2000 and January 3, 1999 consisted of the
following:
 

<TABLE>
<CAPTION>
                       (IN THOUSANDS)                           1999        1998
                       --------------                         --------    --------
<S>                                                           <C>         <C>
Payroll and incentives......................................  $ 32,720    $ 22,463
Employee benefits...........................................    49,293      31,171
Federal, non-U.S. and state income taxes....................    45,324      36,211
Other accrued operating expenses............................   148,320     128,755
                                                              --------    --------
                                                              $275,657    $218,600
                                                              ========    ========
</TABLE>

 
                                       48

<PAGE>   50
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     The increase in other accrued operating expenses resulted primarily from
the acquisition of PEAI in 1999, partially offset by payment of accruals related
to the Lumen acquisition and recognition of gains on dispositions from
previously deferred sales proceeds.
 
     NOTE 17.  EMPLOYEE BENEFIT PLANS
 
     Except where noted otherwise, the following employee benefit plan
disclosures include amounts and information, on a combined basis, for both the
continuing and discontinued operations of the Company.
 
     Savings Plan:  The Company has a savings plan for the benefit of qualified
U.S. employees. Under this plan, the Company contributes an amount equal to the
lesser of 55% of the amount of the employee's voluntary contribution or 3.3% of
the employee's annual compensation. Savings plan expense charged to continuing
operations was $3.9 million in 1999, $2.7 million in 1998 and $2.8 million in
1997.
 
     Pension Plans:  The Company has defined benefit pension plans covering
substantially all U.S. employees and non-U.S. pension plans for non-U.S.
employees. The plans provide benefits that are based on an employee's years of
service and compensation near retirement. Assets of the U.S. plan are composed
primarily of equity and debt securities.
 
     Net periodic pension cost included the following components:
 

<TABLE>
<CAPTION>
                  (IN THOUSANDS)                       1999        1998        1997
                  --------------                     --------    --------    --------
<S>                                                  <C>         <C>         <C>
Service cost.......................................  $  8,539    $  9,356    $  9,081
Interest cost......................................    19,528      18,300      18,126
Expected return on plan assets.....................   (23,130)    (23,360)    (21,288)
Net amortization and deferral......................      (645)       (816)       (743)
                                                     --------    --------    --------
                                                     $  4,292    $  3,480    $  5,176
                                                     ========    ========    ========
</TABLE>

 
     The following table sets forth the changes in the funded status of the
principal U.S. pension plan and the principal non-U.S. pension plans and the
amounts recognized in the Company's Consolidated Balance Sheets as of January 2,
2000 and January 3, 1999:
 

<TABLE>
<CAPTION>
                                                   1999                   1998
                                            -------------------    -------------------
                                             NON-                   NON-
              (IN THOUSANDS)                 U.S.        U.S.       U.S.        U.S.
              --------------                -------    --------    -------    --------
<S>                                         <C>        <C>         <C>        <C>
Actuarial present value of benefit
  obligations:
Accumulated benefit obligations...........  $84,110    $144,588    $29,387    $232,978
                                            =======    ========    =======    ========
Projected benefit obligations at beginning
  of year.................................  $32,571    $259,468    $27,912    $240,176
PEAI projected benefit obligations at date
  of acquisition..........................   67,780          --         --          --
Service cost..............................    1,528       7,011        886       8,470
Interest cost.............................    3,872      15,656      1,860      16,440
Benefits paid.............................   (2,345)    (11,802)      (948)    (11,734)
Actuarial loss (gain).....................   (4,489)      1,859      1,182      23,318
Effect of exchange rate changes...........   (7,029)         --      1,679          --
Dispositions..............................       --          --         --     (17,202)
Settlement loss -- discontinued
  operations..............................       --      20,316         --          --
Curtailment gain -- discontinued
  operations..............................       --     (13,798)        --          --
</TABLE>

 
                                       49

<PAGE>   51
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 

<TABLE>
<CAPTION>
                                                   1999                   1998
                                            -------------------    -------------------
                                             NON-                   NON-
              (IN THOUSANDS)                 U.S.        U.S.       U.S.        U.S.
              --------------                -------    --------    -------    --------
<S>                                         <C>        <C>         <C>        <C>
Reduction of projected benefit
  obligations -- discontinued
  operations..............................       --    (107,604)        --          --
                                            -------    --------    -------    --------
Projected benefit obligations at end of
  year....................................   91,888     171,106     32,571     259,468
                                            -------    --------    -------    --------
Fair value of plan assets at beginning of
  year....................................       --     310,024         --     294,790
Actual return on plan assets..............       --      65,040         --      26,968
Benefits paid and plan expenses...........       --     (12,679)        --     (11,734)
Transfer out -- discontinued operations...       --    (107,850)        --          --
                                            -------    --------    -------    --------
Fair value of plan assets at end of
  year....................................       --     254,535         --     310,024
                                            -------    --------    -------    --------
Plan assets less (greater) than projected
  benefit obligations.....................   91,888     (83,429)    32,571     (50,556)
Unrecognized net transition asset.........       --       1,024         --       2,254
Unrecognized prior service costs..........     (918)        (54)    (1,146)        (77)
Unrecognized net gain.....................    2,385      48,078      2,619       7,779
                                            -------    --------    -------    --------
Accrued pension liability (asset).........  $93,355    $(34,381)   $34,044    $(40,600)
                                            =======    ========    =======    ========
Actuarial assumptions as of the year-end
  measurement date:
  Discount rate...........................      5.8%        7.5%       6.5%        6.5%
  Rate of compensation increase...........      3.5%        4.5%       4.0%        4.5%
  Expected rate of return on assets.......       --         9.0%        --         9.0%
</TABLE>

 
     Non-U.S. accrued pension liabilities classified as long-term liabilities
totaled $122 million and $34 million as of January 2, 2000 and January 3, 1999,
respectively. The U.S. pension asset was classified as other noncurrent assets.
 
     The Company also sponsors a supplemental executive retirement plan to
provide senior management with benefits in excess of normal pension benefits. At
January 2, 2000 and January 3, 1999, the projected benefit obligations were
$14.9 million and $13.8 million, respectively. Assets with a fair value of $9.8
million and $10.1 million, segregated in a trust, were available to meet this
obligation as of January 2, 2000 and January 3, 1999, respectively. Pension
expense for this plan was approximately $1.8 million in 1999, $1.4 million in
1998 and $1.3 million in 1997.
 
     Postretirement Medical Plans:  The Company provides health care benefits
for eligible retired U.S. employees under a comprehensive major medical plan or
under health maintenance organizations where available. The majority of the
Company's U.S. employees become eligible for retiree health benefits if they
retire directly from the Company and have at least ten years of service.
Generally, the major medical plan pays stated percentages of covered expenses
after a deductible is met and takes into consideration payments by other group
coverages and by Medicare. The plan requires retiree contributions under most
circumstances and has provisions for cost-sharing changes. For employees
retiring after 1991, the Company has capped its medical premium contribution
based on employees' years of service. The Company funds the amount allowable
under a 401(h) provision in the Company's defined benefit pension plan. Assets
of the plan are composed primarily of equity and debt securities.
 
                                       50

<PAGE>   52
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     Net periodic postretirement medical benefit cost (credit) included the
following components:
 

<TABLE>
<CAPTION>
                    (IN THOUSANDS)                       1999       1998       1997
                    --------------                      -------    -------    -------
<S>                                                     <C>        <C>        <C>
Service cost..........................................  $   289    $   360    $   317
Interest cost.........................................    1,036      1,250      1,237
Expected return on plan assets........................   (1,304)    (1,245)      (804)
Net amortization and deferral.........................   (1,022)      (402)    (1,148)
                                                        -------    -------    -------
                                                        $(1,001)   $   (37)   $  (398)
                                                        =======    =======    =======
</TABLE>

 
     The following table sets forth the changes in the postretirement medical
plan's funded status and the amounts recognized in the Company's Consolidated
Balance Sheets at January 2, 2000 and January 3, 1999:
 

<TABLE>
<CAPTION>
                       (IN THOUSANDS)                          1999       1998
                       --------------                         -------    -------
<S>                                                           <C>        <C>
Actuarial present value of accumulated benefit obligations:
  Retirees..................................................  $13,672    $11,448
  Active employees eligible to retire.......................      800        565
  Other active employees....................................    5,256      5,032
                                                              -------    -------
Accumulated benefit obligations at beginning of year........   19,728     17,045
                                                              -------    -------
Service cost................................................      289        360
Interest cost...............................................    1,036      1,250
Benefits paid...............................................   (1,204)    (1,394)
Actuarial loss (gain).......................................   (2,782)     2,467
Settlement loss -- discontinued operations..................      381         --
Curtailment gain -- discontinued operations.................   (2,350)        --
Reduction of accumulated benefit obligations -- discontinued
  operations................................................   (2,231)        --
                                                              -------    -------
Change in accumulated benefit obligations during the year...   (6,861)     2,683
                                                              -------    -------
  Retirees..................................................   10,379     13,672
  Active employees eligible to retire.......................      371        800
  Other active employees....................................    2,117      5,256
                                                              -------    -------
Accumulated benefit obligations at end of year..............   12,867     19,728
                                                              -------    -------
Fair value of plan assets at beginning of year..............   15,255     13,839
Actual return on plan assets................................    3,214      1,416
Benefits paid and plan expenses.............................     (757)        --
Transfer out -- discontinued operations.....................   (3,238)        --
                                                              -------    -------
Fair value of plan assets at end of year....................   14,474     15,255
                                                              -------    -------
Fair value of plan assets less (greater) than accumulated
  benefit obligations.......................................   (1,605)     4,473
Unrecognized net gain.......................................    9,234      7,483
                                                              -------    -------
Accrued postretirement medical liability....................  $ 7,629    $11,956
                                                              =======    =======
</TABLE>

 
                                       51

<PAGE>   53
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 

<TABLE>
<CAPTION>
                       (IN THOUSANDS)                          1999       1998
                       --------------                         -------    -------
<S>                                                           <C>        <C>
Actuarial assumptions as of the year-end measurement date:
  Discount rate.............................................      7.5%       6.5%
  Expected rate of return on assets.........................      9.0%       9.0%
  Health care cost trend rate:
     First year.............................................      9.0%       9.0%
     Ultimate...............................................      5.5%       5.5%
     Time to reach ultimate.................................  4 years    5 years
</TABLE>

 
     The accrued postretirement medical liability included $6.6 million and $11
million classified as long-term liabilities as of January 2, 2000 and January 3,
1999, respectively.
 
     If the health care cost trend rate was increased 1%, the accumulated
postretirement benefit obligations would have increased by approximately $0.5
million at January 2, 2000. The effect of this increase on the annual cost for
1999 would have been approximately $45,000. If the health care cost trend rate
was decreased 1%, the accumulated postretirement benefit obligations would have
decreased by approximately $0.4 million at January 2, 2000. The effect of this
decrease on the annual cost for 1999 would have been approximately $39,000.
 
     Deferred Compensation Plans:  During 1998, the Company implemented certain
nonqualified deferred compensation programs that provide benefits payable to
officers and certain key employees or their designated beneficiaries at
specified future dates, upon retirement or death. Benefit payments under these
plans are funded by a combination of contributions from participants and the
Company.
 
     Employee Stock Purchase Plan:  The Company has an Employee Stock Purchase
Plan, whereby participating employees have the right to purchase common stock at
a price equal to 85% of the lower of the closing price on the first day or the
last day of the six-month offering period. The number of shares which an
employee may purchase, subject to certain aggregate limits, is determined by the
employee's voluntary contribution which may not exceed 10% of base compensation.
 
     Other:  In April 1999, the Company's stockholders approved the 1999
Incentive Plan, under which cash performance awards as well as an aggregate of
3.5 million shares of the Company's common stock were made available for option
grants, restricted stock awards, performance units and other stock-based awards.
 
     The Company incurred a $2.8 million charge in 1997 related to a cash
deficit in an employee benefit plan.
 
NOTE 18. REIMBURSEMENT OF INVESTED CAPITAL
 
     In 1997, the Company received a $30.4 million payment as part of the
negotiation of a joint development contract. This payment represented a $27
million reimbursement of previously invested capital, which will be amortized to
income over the estimated life of the related assets, and a $3.4 million
reimbursement of cost of capital, which was included in other income. The
reimbursement, net of accumulated amortization, included in long-term
liabilities was $15.3 million as of January 2, 2000 and $20.4 million as of
January 3, 1999.
 
NOTE 19. CONTINGENCIES
 
     The Company is subject to various claims, legal proceedings and
investigations covering a wide range of matters that arise in the ordinary
course of its business activities. Each of these matters is subject to various
uncertainties, and it is possible that some of these matters may be resolved
unfavorably to the Company. The Company has established accruals for matters
that are probable and reasonably estimable. Management believes that any
liability that may ultimately result from the resolution of these matters in
excess of amounts provided will not have a material adverse effect on the
financial position or results of operations of the Company.
 
                                       52

<PAGE>   54
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     In addition, the Company is conducting a number of environmental
investigations and remedial actions at current and former Company locations and,
along with other companies, has been named a potentially responsible party (PRP)
for certain waste disposal sites. The Company accrues for environmental issues
in the accounting period that the Company's responsibility is established and
when the cost can be reasonably estimated. The Company has accrued $12.3 million
as of January 2, 2000, representing management's estimate of the total cost of
ultimate disposition of known environmental matters. Such amount is not
discounted and does not reflect any recovery of any amounts through insurance or
indemnification arrangements. These cost estimates are subject to a number of
variables, including the stage of the environmental investigations, the
magnitude of the possible contamination, the nature of the potential remedies,
possible joint and several liability, the timeframe over which remediation may
occur and the possible effects of changing laws and regulations. For sites where
the Company has been named a PRP, management does not currently anticipate any
additional liability to result from the inability of other significant named
parties to contribute. The Company expects that such accrued amounts could be
paid out over a period of up to five years. As assessments and remediation
activities progress at each individual site, these liabilities are reviewed and
adjusted to reflect additional information as it becomes available. There have
been no environmental problems to date that have had or are expected to have a
material effect on the Company's financial position or results of operations.
While it is reasonably possible that a material loss exceeding the amounts
recorded may have been incurred, the preliminary stages of the investigations
make it impossible for the Company to reasonably estimate the range of potential
exposure.
 
     The Company has received notices from the Internal Revenue Service (IRS)
asserting deficiencies in federal corporate income taxes for the Company's 1985
to 1994 tax years. The total additional tax proposed by the IRS amounts to $74
million plus interest. The Company has filed petitions in the United States Tax
Court to challenge most of the deficiencies asserted by the IRS. The Company
believes that it has meritorious legal defenses to those deficiencies and
believes that the ultimate outcome of the case will not result in a material
impact on the Company's consolidated results of operations or financial
position.
 
NOTE 20. RISKS AND UNCERTAINTIES
 
     For information concerning various investigations, claims, legal
proceedings, environmental investigations and remedial actions, and notices from
the IRS, see Note 19. For information concerning factors affecting future
performance, see Management's Discussion and Analysis.
 
     Costs incurred under cost-reimbursable government contracts, primarily in
the former Technical Services segment, which is presented as discontinued
operations, are subject to audit by the government. The results of prior audits,
completed through 1995, have not had a material effect on the Company.
 
     The Company's management and operations contracts with the DOE are
presented as discontinued operations. The Company's last DOE management and
operations contract expired on September 30, 1997. The Company is in the process
of negotiating contract closeouts and does not anticipate incurring any material
loss in excess of previously established reserves.
 
NOTE 21. STOCKHOLDERS' EQUITY
 
     Stock-Based Compensation:  Under the 1999 Incentive Plan, 3.5 million
additional shares of the Company's common stock were made available for option
grants, restricted stock awards, performance units and other stock-based awards.
At January 2, 2000, 11.4 million shares of the Company's common stock were
reserved for employee benefit plans.
 
     The Company has nonqualified and incentive stock option plans for officers
and key employees. Under these plans, options may be granted at prices not less
than 100% of the fair market value on the date of grant. Options expire 7-10
years from the date of grant, and options granted since 1994 become exercisable,
in
 
                                       53

<PAGE>   55
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
ratable installments, over periods of 3-5 years from the date of grant. The
Stock Option Committee of the Board of Directors, at its sole discretion, may
also include stock appreciation rights in any option granted. There are no stock
appreciation rights outstanding under these plans.
 
     The following table summarizes stock option activity for the three years
ended January 2, 2000:
 

<TABLE>
<CAPTION>
                                            1999                    1998                    1997
                                    ---------------------   ---------------------   ---------------------
                                                WEIGHTED-               WEIGHTED-               WEIGHTED-
                                     NUMBER      AVERAGE     NUMBER      AVERAGE     NUMBER      AVERAGE
      (SHARES IN THOUSANDS)         OF SHARES     PRICE     OF SHARES     PRICE     OF SHARES     PRICE
      ---------------------         ---------   ---------   ---------   ---------   ---------   ---------
<S>                                 <C>         <C>         <C>         <C>         <C>         <C>
Outstanding at beginning of
  year............................    3,300      $20.05       4,187      $19.64       4,161      $19.56
  Granted.........................    2,711       25.94         568       22.82         927       19.19
  Exercised.......................   (1,109)      19.08      (1,209)      19.87        (363)      16.74
  Lapsed..........................     (330)      23.28        (246)      20.29        (538)      20.23
                                     ------                  ------                   -----
Outstanding at end of year........    4,572       23.53       3,300       20.05       4,187       19.64
                                     ======                  ======                   =====
Exercisable at end of year........    1,851       19.31       1,540       19.46       2,195       19.85
                                     ======                  ======                   =====
Available for grant at end of
  year............................    4,665                   2,866                   2,290
                                     ======                  ======                   =====
</TABLE>

 
     The following table summarizes information about stock options outstanding
at January 2, 2000:
 

<TABLE>
<CAPTION>
RANGE OF EXERCISE PRICES                       OPTIONS OUTSTANDING               OPTIONS EXERCISABLE
------------------------              --------------------------------------    ----------------------
                                                    WEIGHTED-
                                                     AVERAGE       WEIGHTED-                 WEIGHTED-
                                                    REMAINING       AVERAGE                   AVERAGE
                                      NUMBER OF    CONTRACTUAL     EXERCISE     NUMBER OF    EXERCISE
       (SHARES IN THOUSANDS)           SHARES      LIFE (YEARS)      PRICE       SHARES        PRICE
       ---------------------          ---------    ------------    ---------    ---------    ---------
<S>                                   <C>          <C>             <C>          <C>          <C>
$ 5.64 - 15.28......................      348          3.8          $13.37          348       $13.37
 15.95 - 23.44......................    2,053          5.1           20.32        1,435        20.22
 25.75 - 39.19......................    2,171          7.0           28.19           68        30.36
                                        -----                                     -----
  5.64 - 39.19......................    4,572          5.9           23.53        1,851        19.31
                                        =====                                     =====
</TABLE>

 
     During 1999, 1,611,000 options were granted pursuant to the 1992 Stock
Option Plan at exercise prices ranging from $25.75 per share to $28.81 per
share; 421,000 options were granted pursuant to the 1999 Incentive Plan at
exercise prices ranging from $29.69 per share to $39.19 per share and 250,000
options were granted to an officer at an exercise price of $27.25 per share
pursuant to a plan other than the 1992 and 1999 Plans. In connection with the
acquisition of Lumen Technologies, Lumen options were converted into
approximately 429,000 Company stock options, effective January 5, 1999. These
options had an average exercise price of $14.47 per share and were fully vested.
In January 1998, the Board of Directors granted 400,000 options to an officer at
an exercise price of $21.19 per share; 200,000 options were granted pursuant to
the 1992 Plan, and 200,000 options were granted pursuant to a plan other than
the 1992 Plan. In addition, 167,500 options were granted pursuant to the 1992
Plan at various dates in 1998 at exercise prices ranging from $23.13 per share
to $30.25 per share. In December 1997, 927,000 options were granted at an
exercise price of $19.19 per share.
 
                                       54

<PAGE>   56
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     The weighted-average fair values of options granted during 1999, 1998 and
1997 were $9.14, $6.83 and $6.14, respectively. The values were estimated on the
date of grant using the Black-Scholes option pricing model. The following
weighted-average assumptions were used in the model:
 

<TABLE>
<CAPTION>
                                                          1999        1998       1997
                                                        ---------    -------    -------
<S>                                                     <C>          <C>        <C>
Risk-free interest rate...............................        4.9%       5.4%       5.9%
Expected dividend yield...............................          2%         2%         2%
Expected lives........................................   5.5 years    6 years    7 years
Expected stock volatility.............................         27%        27%        26%
</TABLE>

 
     In April 1999, the Company's stockholders approved the 1998 Employee Stock
Purchase Plan, whereby participating employees currently have the right to
purchase common stock at a price equal to 85% of the lower of the closing price
on the first day or the last day of the six-month offering period. The first
offering period, for which the employee discount was 10%, began on September 1,
1998 and ended on June 30, 1999. The number of shares which an employee may
purchase, subject to certain aggregate limits, is determined by the employee's
voluntary contribution which may not exceed 10% of base compensation. During
1999, the Company issued 358,000 shares under this plan at a weighted-average
price of $22.14 per share. There remains available for sale to employees an
aggregate of 2.1 million shares of the Company's stock out of 2.5 million shares
authorized by the stockholders.
 
     As permitted by SFAS No. 123, Accounting for Stock-Based Compensation, the
Company continues to apply APB Opinion No. 25 in accounting for its stock option
and stock purchase plans. As required, the following table disclosed pro forma
net income and diluted earnings per share had compensation cost for the
Company's stock-based compensation plans been determined based on the fair value
approach:
 

<TABLE>
<CAPTION>
        (IN THOUSANDS EXCEPT PER SHARE DATA)            1999        1998       1997
        ------------------------------------          --------    --------    -------
<S>                                                   <C>         <C>         <C>
Net income:
  As reported.......................................  $154,316    $102,002    $33,692
  Pro forma.........................................   145,354     100,000     32,891
Diluted earnings per share:
  As reported.......................................      3.31        2.22        .74
  Pro forma.........................................      3.12        2.18        .72
</TABLE>

 
     Pro forma compensation cost may not be representative of that to be
expected in future years since the estimated fair value of stock options is
amortized to expense over the vesting period, and additional options may be
granted in future years.
 
     Shareholder Rights Plan:  Under a Shareholder Rights Plan, preferred stock
purchase rights were distributed on February 8, 1995 as a dividend at the rate
of one right for each share of common stock outstanding. Each right, when
exercisable, entitles a stockholder to purchase one one-thousandth of a share of
a new series of junior participating preferred stock at a price of $60. The
rights become exercisable only if a person or group acquires 20% or more or
announces a tender or exchange offer for 30% or more of the Company's common
stock. This preferred stock is nonredeemable and will have 1,000 votes per
share. The rights are nonvoting, expire in 2005 and may be redeemed prior to
becoming exercisable. The Company has reserved 70,000 shares of preferred stock,
designated as Series C Junior Participating Preferred Stock, for issuance upon
exercise of such rights. If a person (an Acquiring Person) acquires or obtains
the right to acquire 20% or more of the Company's outstanding common stock
(other than pursuant to certain approved offers), each right (other than rights
held by the Acquiring Person) will entitle the holder to purchase shares of
common stock of the Company at one-half of the current market price at the date
of occurrence of the event. In addition, in the event that the Company is
involved in a merger or other business combination in which it is not the
surviving corporation or in connection with which the Company's common stock is
changed or converted, or it sells or transfers 50% or more of its assets or
earning power to another person, each right that has not previously been
exercised will entitle its holder to purchase shares of common stock of such
other person at one-half of the current market price of such common stock at the
date of the occurrence of the event.
 
                                       55

<PAGE>   57
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     Comprehensive Income:  The components of accumulated other comprehensive
income (loss) were as follows:
 

<TABLE>
<CAPTION>
                                       FOREIGN CURRENCY                        ACCUMULATED OTHER
                                         TRANSLATION       UNREALIZED GAINS      COMPREHENSIVE
           (IN THOUSANDS)                ADJUSTMENTS        ON SECURITIES        INCOME (LOSS)
           --------------              ----------------    ----------------    -----------------
<S>                                    <C>                 <C>                 <C>
Balance, December 29, 1996...........      $ 18,228             $1,204             $ 19,432
Current year change..................       (22,608)              (681)             (23,289)
                                           --------             ------             --------
Balance, December 28, 1997...........        (4,380)               523               (3,857)
Current year change..................         7,723               (137)               7,586
                                           --------             ------             --------
Balance, January 3, 1999.............         3,343                386                3,729
Current year change..................       (17,804)                35              (17,769)
                                           --------             ------             --------
Balance, January 2, 2000.............      $(14,461)            $  421             $(14,040)
                                           ========             ======             ========
</TABLE>

 
     The tax effects related to each component of other comprehensive income
(loss) were as follows:
 

<TABLE>
<CAPTION>
                                                         BEFORE-TAX    TAX (PROVISION)    AFTER-TAX
                    (IN THOUSANDS)                         AMOUNT          BENEFIT         AMOUNT
                    --------------                       ----------    ---------------    ---------
<S>                                                      <C>           <C>                <C>
1999
Foreign currency translation adjustments...............   $(17,804)         $ --          $(17,804)
Unrealized gains on securities:
  Gains arising during the period......................        143           (50)               93
  Reclassification adjustment..........................        (89)           31               (58)
                                                          --------          ----          --------
Net unrealized gains...................................         54           (19)               35
                                                          --------          ----          --------
Other comprehensive income (loss)......................   $(17,750)         $(19)         $(17,769)
                                                          ========          ====          ========
1998
Gross foreign currency translation adjustments.........   $  4,608          $ --          $  4,608
Reclassification adjustment for translation losses
  realized upon sale of Sealol Industrial Seals........      3,115            --             3,115
Unrealized losses on securities arising during the
  period...............................................       (211)           74              (137)
                                                          --------          ----          --------
Other comprehensive income.............................   $  7,512          $ 74          $  7,586
                                                          ========          ====          ========
1997
Foreign currency translation adjustments...............   $(22,608)         $ --          $(22,608)
Unrealized losses on securities:
  Losses arising during the period.....................     (1,008)          353              (655)
  Reclassification adjustment..........................        (40)           14               (26)
                                                          --------          ----          --------
Net unrealized losses..................................     (1,048)          367              (681)
                                                          --------          ----          --------
Other comprehensive income (loss)......................   $(23,656)         $367          $(23,289)
                                                          ========          ====          ========
</TABLE>

 
NOTE 22. FINANCIAL INSTRUMENTS
 
     Financial instruments that potentially subject the Company to
concentrations of credit risk consist principally of temporary cash investments
and accounts receivable. The Company believes it had no significant
concentrations of credit risk as of January 2, 2000.
 
     The Company has relatively limited involvement with derivative financial
instruments. In the ordinary course of business, the Company enters into foreign
exchange forward contracts for periods consistent with its
 
                                       56

<PAGE>   58
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
committed exposures to mitigate the effect of foreign currency movements on
transactions denominated in foreign currencies. Transactions covered by hedge
contracts include intercompany and third-party receivables and payables. The
contracts are primarily in European and Asian currencies, generally have
maturities that do not exceed one month and have no cash requirements until
maturity. Credit risk and market risk are minimal because the forward contracts
are with very large banks, and gains and losses are offset against foreign
exchange gains and losses on the underlying hedged transactions. From time to
time the Company enters into foreign exchange forward contracts to mitigate the
effect of foreign currency movements associated with anticipatory transactions
denominated in foreign currencies. Realized gains and losses on foreign currency
instruments, which are hedges of committed transactions on assets and
liabilities, are recognized at the time the underlying transaction is completed.
Realized and unrealized gains and losses on forward contracts, which are not
hedges of committed transactions, are recognized in income. The notional amount
of outstanding forward contracts was $75 million as of January 2, 2000 and $42
million as of January 3, 1999. The carrying value as of January 2, 2000 and
January 3, 1999, which approximated fair value, was not significant.
 
     See Notes 1, 13 and 15 for disclosures about fair values, including methods
and assumptions, of other financial instruments.
 
NOTE 23. LEASES
 
     The Company leases certain property and equipment under operating leases.
Rental expense charged to continuing operations for 1999, 1998 and 1997 amounted
to $19.2 million, $10.1 million and $10.1 million, respectively. Minimum rental
commitments under noncancelable operating leases are as follows: $19 million in
2000, $14.6 million in 2001, $12.9 million in 2002, $12.1 million in 2003, $11.4
million in 2004 and $12.4 million after 2004.
 
NOTE 24. INDUSTRY SEGMENT AND GEOGRAPHIC AREA INFORMATION
 
     In 1998, the Company adopted SFAS No. 131, Disclosures about Segments of an
Enterprise and Related Information, which changed the way the Company reports
information about its operating segments. The Company's businesses are reported
as four reportable segments which reflect the Company's management and structure
under four SBUs. The accounting policies of the reportable segments are the same
as those described in Note 1. The Company evaluates the performance of its
operating segments based on operating profit. Intersegment sales and transfers
are not significant.
 
     The operating segments and their principal products and services are:
 
          Life Sciences:  Sample handling and measuring instruments, computer
     software and chemical reagents for use in bio-screening and population
     screening laboratories. Bio-screening activities include academic research
     applications and drug discovery applications in high throughput screening
     laboratories of major pharmaceutical companies. Population screening
     activities include inherited and infectious disease screening, as well as
     routine clinical diagnostics.
 
          Optoelectronics:  A broad spectrum of optoelectronic products,
     including large area amorphous silicon detectors, high volume and
     high-performance specialty lighting sources, detectors, imaging devices, as
     well as telecom products, which include emitters, receivers and mux arrays.
 
          Instruments:  Products and services for detection, measurement and
     testing applications, including analytical instruments for the
     pharmaceutical, food and beverage, environmental, chemical and plastics
     industries.
 
          Fluid Sciences:  Static and dynamic seals, sealing systems, solenoid
     valves, bellows devices, advanced pneumatic components, systems and
     assemblies and sheet metal-formed products for original equipment
     manufacturers and end users.
 
                                       57

<PAGE>   59
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
     Sales to U.S. government agencies, which were predominantly to the
Department of Defense and NASA in the former Technical Services segment, which
is reflected as discontinued operations in the accompanying financial statements
(see Note 8), were $326 million, $524 million and $537 million in 1999, 1998 and
1997, respectively. In 1998, the Company's joint venture with Johnson Controls
was unsuccessful in its bid to provide support services to NASA and the Air
Force at Florida's Kennedy Space Center, Cape Canaveral Air Station and Patrick
Air Force Base. The NASA contract at the Kennedy Space Center contributed sales
of $134 million in 1998 and $168 million in 1997.
 
     Sales and operating profit by segment for the three years ended January 2,
2000 are shown in the table below:
 

<TABLE>
<CAPTION>
                  (IN THOUSANDS)                       1999         1998        1997
                  --------------                    ----------    --------    --------
<S>                                                 <C>           <C>         <C>
LIFE SCIENCES
Sales.............................................  $  163,587    $148,124    $125,380
Operating Profit..................................      15,453       9,046      10,108
OPTOELECTRONICS
Sales.............................................     412,592     268,558     261,291
Operating Profit (Loss)...........................      34,934      (5,454)    (23,128)
INSTRUMENTS
Sales.............................................     607,281     247,388     236,839
Operating Profit (Loss)...........................      (9,351)      6,659      17,966
FLUID SCIENCES
Sales.............................................     179,669     167,646     127,087
Operating Profit..................................      22,204       5,194       8,846
OTHER
Sales.............................................          --      22,666     176,885
Operating Profit..................................       3,412     104,279      13,227
CONTINUING OPERATIONS
Sales.............................................   1,363,129     854,382     927,482
Operating Profit..................................      66,652     119,724      27,019
</TABLE>

 
     The Company's Technical Services segment and former Department of Energy
segment are presented as discontinued operations and, therefore, are not
included in the preceding table. The results for the periods presented included
certain nonrecurring items which are discussed in the Management's Discussion
and Analysis section of this document.
 
     Additional information relating to the Company's operating segments is as
follows:
 

<TABLE>
<CAPTION>
                                       DEPRECIATION AND
                                     AMORTIZATION EXPENSE             CAPITAL EXPENDITURES
                                 -----------------------------    -----------------------------
       (IN THOUSANDS)             1999       1998       1997       1999       1998       1997
       --------------            -------    -------    -------    -------    -------    -------
<S>                              <C>        <C>        <C>        <C>        <C>        <C>
Life Sciences................    $ 6,189    $ 5,059    $ 4,091    $ 7,465    $ 5,415    $ 3,352
Optoelectronics..............     34,430     25,615     19,528     21,155     17,256     21,312
Instruments..................     17,292     10,573     11,688      6,555      8,382      7,616
Fluid Sciences...............      7,093      6,042      3,090      4,515     10,325      9,488
Other........................      1,111      1,221      4,301      1,402      3,111      5,874
                                 -------    -------    -------    -------    -------    -------
  Continuing operations......    $66,115    $48,510    $42,698    $41,092    $44,489    $47,642
                                 =======    =======    =======    =======    =======    =======
  Discontinued operations....    $   841    $ 1,869    $ 1,914    $ 1,341    $ 2,033    $ 1,087
                                 =======    =======    =======    =======    =======    =======
</TABLE>

 
                                       58

<PAGE>   60
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 

<TABLE>
<CAPTION>
                                                                    TOTAL ASSETS
                                                              ------------------------
                       (IN THOUSANDS)                            1999          1998
                       --------------                         ----------    ----------
<S>                                                           <C>           <C>
Life Sciences...............................................  $  125,025    $  128,970
Optoelectronics.............................................     448,453       479,818
Instruments.................................................     854,452       183,590
Fluid Sciences..............................................     102,421       112,898
Other.......................................................     184,289       233,502
                                                              ----------    ----------
                                                              $1,714,640    $1,138,778
                                                              ==========    ==========
</TABLE>

 
     Other total assets consisted primarily of cash and cash equivalents,
prepaid pension, prepaid taxes and, in 1998, net assets of discontinued
operations.
 
     The following geographic area information for continuing operations
includes sales based on location of external customer and net property, plant
and equipment based on physical location:
 

<TABLE>
<CAPTION>
                                                                  SALES
                                                    ----------------------------------
                  (IN THOUSANDS)                       1999         1998        1997
                  --------------                    ----------    --------    --------
<S>                                                 <C>           <C>         <C>
U.S. .............................................  $  661,609    $447,793    $512,503
Germany...........................................      98,787      67,647      71,390
Japan.............................................      73,567      28,306      21,630
United Kingdom....................................      71,493      47,794      65,462
Italy.............................................      56,433      17,565      19,204
France............................................      50,282      35,329      44,417
Other Non-U.S. ...................................     350,958     209,948     192,876
                                                    ----------    --------    --------
                                                    $1,363,129    $854,382    $927,482
                                                    ==========    ========    ========
</TABLE>

 

<TABLE>
<CAPTION>
                                                              NET PROPERTY, PLANT AND
                                                                     EQUIPMENT
                                                              ------------------------
                       (IN THOUSANDS)                            1999          1998
                       --------------                         ----------    ----------
<S>                                                           <C>           <C>
U.S. .......................................................   $133,812      $133,550
Germany.....................................................     21,570        21,923
Finland.....................................................     17,277        15,431
Canada......................................................     14,718         8,861
United Kingdom..............................................     13,282         3,453
Other Non-U.S. .............................................     27,375        35,462
                                                               --------      --------
                                                               $228,034      $218,680
                                                               ========      ========
</TABLE>

 
     Effectively all of the sales and net property, plant and equipment of the
discontinued operations (consisting of the Technical Services segment and former
DOE segment) were U.S. based.
 
                                       59

<PAGE>   61
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
NOTE 25. QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
 
     Selected quarterly financial information follows:
 

<TABLE>
<CAPTION>
                                          FIRST      SECOND     THIRD      FOURTH
 (IN THOUSANDS EXCEPT PER SHARE DATA)    QUARTER    QUARTER    QUARTER    QUARTER       YEAR
 ------------------------------------    --------   --------   --------   --------   ----------
<S>                                      <C>        <C>        <C>        <C>        <C>
1999
Sales..................................  $243,217   $304,258   $388,413   $427,241   $1,363,129
Operating income (loss) from continuing
  operations...........................    17,028      1,940       (328)    48,012       66,652
Income (loss) from continuing
  operations before income taxes.......    12,396     (4,257)    (8,932)    45,663       44,870
Income (loss) from continuing
  operations...........................     8,042     (2,725)    (5,801)    28,855       28,371
Net income.............................    14,087      3,617    103,773     32,839      154,316
Basic earnings (loss) per share:
  Continuing operations................       .18       (.06)      (.13)       .62          .62
  Net income...........................       .31        .08       2.27        .71         3.39
Diluted earnings (loss) per share:
  Continuing operations................       .18       (.06)      (.13)       .61          .61
  Net income...........................       .31        .08       2.27        .69         3.31
Cash dividends per common share........       .14        .14        .14        .14          .56
Market price of common stock:
  High.................................     30.19      36.25      39.94      45.00        45.00
  Low..................................     25.50      26.50      31.50      36.63        25.50
  Close................................     26.75      35.75      38.75      41.69        41.69
1998
Sales..................................  $219,642   $209,424   $191,503   $233,813   $  854,382
Operating income from continuing
  operations...........................    46,398     40,006     10,153     23,167      119,724
Income from continuing operations
  before income taxes..................    44,484     38,913     13,661     21,269      118,327
Income from continuing operations......    28,588     27,753      8,743     13,917       79,001
Net income.............................    34,483     31,614     15,437     20,468      102,002
Basic earnings per share:
  Continuing operations................       .63        .61        .19        .31         1.74
  Net income...........................       .76        .69        .34        .46         2.25
Diluted earnings per share:
  Continuing operations................       .62        .60        .19        .31         1.72
  Net income...........................       .75        .68        .33        .45         2.22
Cash dividends per common share........       .14        .14        .14        .14          .56
Market price of common stock:
  High.................................     28.50      33.75      30.13      29.44        33.75
  Low..................................     19.44      27.13      18.88      20.50        18.88
  Close................................     27.75      29.69      22.44      27.81        27.81
</TABLE>

 
NOTE 26. SUBSEQUENT EVENTS
 
     Acquisition:  On January 14, 2000, the Company completed its previously
announced acquisition of Vivid Technologies, Inc. (Vivid). The transaction was a
stock merger whereby the shareholders of Vivid
 
                                       60

<PAGE>   62
                       PERKINELMER, INC. AND SUBSIDIARIES
 
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
 
received one share of the Company's common stock for each 6.2 shares of Vivid
common stock. The Company issued approximately 1.6 million shares in connection
with the acquisition, resulting in a total transaction value of approximately
$66 million. Vivid, which is a leading supplier of automated explosive detection
systems utilized in airports and high-security facilities worldwide, generated
sales of $21 million for the fiscal year ended September 30, 1999. The
transaction will be accounted for as a purchase in accordance with APB Opinion
No. 16.
 
                                       61

<PAGE>   63
 
 
                   REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
 
To the Stockholders of PerkinElmer, Inc.:
 
     We have audited the accompanying consolidated balance sheets of
PerkinElmer, Inc. (a Massachusetts corporation) and subsidiaries as of January
2, 2000 and January 3, 1999 and the related consolidated statements of income,
stockholders' equity and cash flows for the years ended January 2, 2000, January
3, 1999 and December 28, 1997. These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion on
these financial statements based on our audits.
 
     We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
 
     In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of PerkinElmer,
Inc. and subsidiaries as of January 2, 2000 and January 3, 1999, and the results
of their operations and their cash flows for the years ended January 2, 2000,
January 3, 1999 and December 28, 1997 in conformity with generally accepted
accounting principles.
 
/s/ ARTHUR ANDERSEN LLP
--------------------------------------
Arthur Andersen LLP
Boston, Massachusetts
January 25, 2000

 
                                       62

<PAGE>   64
 

                                    PART III
 

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
 
     None.
 

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
 
     a) DIRECTORS
 
     The information required by this Item with respect to Directors is
contained in the Company's 2000 Proxy Statement for the Annual Meeting of
Stockholders to be held on April 25, 2000 (the "2000 Proxy Statement") under the
captions "Election of Directors," "Information Relative to the Board of
Directors and Certain of its Committees," and "Section 16(a) Beneficial
Ownership Reporting Compliance" and is herein incorporated by reference.
 
     b) EXECUTIVE OFFICERS
 
     The information required by this item with respect to Executive Officers is
contained in Part I of this Report.
 

ITEM 11.  EXECUTIVE COMPENSATION
 
     The information required by this Item is contained under the captions
"Summary Compensation Table" up to and including "Aggregated Option Exercises in
Last Fiscal Year and Fiscal Year-End Value Option Table" and Notes thereto in
the 2000 Proxy Statement, and is herein incorporated by reference.
 

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
 
     The information required by this Item is contained under the captions
"Security Ownership of Certain Beneficial Owners" and "Security Ownership of
Management" in the 2000 Proxy Statement, and is herein incorporated by
reference.
 

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
 
     The information required by this Item is contained under the caption
"Certain Transactions" in the 2000 Proxy Statement, and is herein incorporated
by reference.
 
                                       63

<PAGE>   65
 

                                    PART IV
 

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
 
(a) DOCUMENTS FILED AS PART OF THIS REPORT:
 
     1.  FINANCIAL STATEMENTS
 
        Included in Part II, Item 8:
 
          Consolidated Income Statements for the Three Years Ended January 2,
          2000
 
          Consolidated Balance Sheets as of January 2, 2000 and January 3, 1999
 
          Consolidated Statements of Stockholders' Equity for the Three Years
          Ended January 2, 2000
 
          Consolidated Statements of Cash Flows for the Three Years Ended
          January 2, 2000
 

          Notes to Consolidated Financial Statements
 
 
         Report of Independent Public Accountants
 
     2.  FINANCIAL STATEMENT SCHEDULES
 
        Report of Independent Public Accountants on Financial Statement
        Schedules
 
        Schedule II -- Valuation and Qualifying Accounts
 
     Financial statement schedules, other than those above, are omitted because
of the absence of conditions under which they are required or because the
required information is given in the financial statements or notes thereto.
 
     Separate financial statements of the Registrant are omitted since it is
primarily an operating company, and since all subsidiaries included in the
consolidated financial statements being filed, in the aggregate, do not have
minority equity interests and/or indebtedness to any person other than the
Registrant or its consolidated subsidiaries in amounts which together exceed
five percent of total consolidated assets.
 
     3.  EXHIBITS
 

<TABLE>
<S>      <C>
  3.1    The Company's Restated Articles of Organization were filed
         with the Commission on March 30, 1999 as Exhibit 3.1 to the
         Company's Annual Report on Form 10-K for the fiscal year
         ended January 3, 1999 and are herein incorporated by
         reference.
  3.2    Articles of Amendment to the Company's Restated Articles of
         Organization were filed with the Commission on November 5,
         1999 as Exhibit 3 to the Company's Report on Form 8-K and
         are herein incorporated by reference.
  3.3    The Company's By-Laws as amended and restated by the Board
         of Directors on April 27, 1999 are attached hereto as
         Exhibit 3.3.
  4.1    Specimen Certificate of the Company's Common Stock, $1 par
         value, was filed with the Commission on November 5, 1999 as
         Exhibit 4 to the Company's Report on Form 8-K and is herein
         incorporated by reference.
  4.2    Form of Indenture dated June 28, 1995 between the Company
         and the First National Bank of Boston, as Trustee, was filed
         with the Commission as Exhibit 4.1 to the Company's
         Registration Statement on Form S-3, File No. 33-59675 and is
         herein incorporated by reference.
*10.1    The Company's Supplemental Executive Retirement Plan revised
         as of April 19, 1995 was filed as Exhibit 10.1 to the
         Company's Annual Report on Form 10-K for the fiscal year
         ended December 31, 1995, and is herein incorporated by
         reference.
*10.2    The Company's 1999 INCENTIVE PLAN was filed with the
         Commission on April 2, 1999 as Exhibit B to the Company's
         Definitive Proxy Statement on Schedule 14A and is herein
         incorporated by reference.
</TABLE>

 
                                       64

<PAGE>   66

<TABLE>
<S>      <C>
 10.3    5-Year Competitive Advance and Revolving Credit Facility
         Agreement (referred to as the "5-Year Agreement") dated as
         of March 21, 1994 among the Company, the Lenders Named
         Herein and The Chase Manhattan Bank as Administrative Agent;
         Amendment No. 1 dated as of March 15, 1995; and Amendment
         No. 2 dated as of March 14, 1996 were filed as Exhibit 10.3
         to the Company's Annual Report on Form 10-K for the fiscal
         year ended December 31, 1995 and are herein incorporated by
         reference. Amendment No. 3 dated as of March 7, 1997 was
         filed as Exhibit 10.3 to the Company's Annual Report on Form
         10-K for the fiscal year ended December 29, 1996 and is also
         herein incorporated by reference. Amendment No. 4 dated as
         of November 20, 1998 was filed as Exhibit 10.3 to the
         Company's Annual Report on Form 10-K for the fiscal year
         ended January 3, 1999 and is also herein incorporated by
         reference.
 10.4    $300,000,000 Amended and Restated Competitive Advance and
         Revolving Credit Facility Agreement dated as of March 3,
         2000 among the Company, the Lenders Named Herein and The
         Chase Manhattan Bank as Administrative Agent, which is
         attached hereto as Exhibit 10.4, amends and restates the
         Competitive Advance and Revolving Credit Facility Agreement
         dated as of March 5, 1999 among the Company, the Lenders
         Named Herein and The Chase Manhattan Bank as Administrative
         Agent, which was filed with the Commission as Exhibit 10.4
         to the Company's Annual Report on Form 10-K for the fiscal
         year ended January 3, 1999 and is herein incorporated by
         reference.
*10.5    Employment Contracts:
         (1) Employment contract between Gregory L. Summe and the
         Company dated January 8, 1998, as amended by an amendment
             dated November 5, 1999, is attached hereto as Exhibit
             10.5(a).
         (2) Employment contract between Robert F. Friel and the
             Company dated November 18, 1999.
         (3) Employment contract between Terrance L. Carlson and the
         Company dated August 1, 1999.
         (4) Employment contract between Angelo D. Castellana and the
         Company dated November 10, 1999.
         (5) Employment contract between Richard F. Walsh and the
             Company dated July 29, 1999.
         (6) Employment contract between Robert A. Barrett and the
             Company dated July 23, 1999.
         (7) Employment contract between Patrik Dahlen and the
             Company dated October 1, 1999.
         (8) Employment contract between John J. Engel and the
             Company dated December 1, 1999.
         (9) Employment contract between Robert J. Rosenthal and the
             Company dated July 23, 1999.
         (10) Employment contract between Gregory D. Perry and the
              Company dated August 8, 1999.
         Except for the name of the officer in the employment
         contracts identified by numbers 2 through and including 10,
         the form of said employment contracts is identical in all
         material respects. The employment contract between Angelo D.
         Castellana and the Company is representative of the
         employment contracts of these executive officers and is
         attached hereto as Exhibit 10.5(b).
*10.6    The Company's 1982 INCENTIVE STOCK OPTION PLAN was filed as
         Exhibit 4(v) to the Company's Registration Statement on Form
         S-8, File No. 33-36082 and is herein incorporated by
         reference.
*10.7    The Company's 1992 STOCK OPTION PLAN was filed as Exhibit
         4(vi) to the Company's Registration Statement on Form S-8,
         File No. 333-32059 and is herein incorporated by reference.
*10.8    The Company's 1998 EMPLOYEE STOCK PURCHASE PLAN was filed
         with the Commission on March 30, 1999 as Exhibit 10.8 to the
         Company's Annual Report on Form 10-K for the fiscal year
         ended January 3, 1999 and is herein incorporated by
         reference.
*10.9    Agreement and General Release between the Company and Murray
         Gross dated April 30, 1999.
*10.10   Agreement and General Release between the Company and Daniel
         T. Heaney dated November 3, 1998.
</TABLE>

 
                                       65

<PAGE>   67

<TABLE>
<S>      <C>
*10.11   Agreement and General Release between the Company and
         Deborah S. Lorenz dated June 6, 1998.
 21      Subsidiaries of the Registrant.
 23      Consent of Independent Public Accountants (appears on
         signature page).
 24      Power of Attorney (appears on signature page).
 27      Financial Data Schedule.
</TABLE>

 
---------------
* This exhibit is a management contract or compensatory plan or arrangement
  required to be filed as an Exhibit pursuant to Item 14(c) of Form 10-K.
 
(b) REPORTS ON FORM 8-K
 
     A report on Form 8-K was filed with the Commission on November 5, 1999
regarding an amendment to the Company's Restated Articles of Organization filed
with the Massachusetts Secretary of State on October 26, 1999 by which the
Company changed its name from "EG&G, Inc." to "PerkinElmer, Inc."
 
     A report on Form 8-K was filed with the Commission on November 23, 1999
regarding the sale of the Technical Services segment and the restatement of
financial statements and other information to reflect Technical Services as a
discontinued operation.
 
(c) PROXY STATEMENT
 
     The Company's 2000 Proxy Statement, in definitive form, was filed
electronically on March 27, 2000 with the Securities and Exchange Commission in
Washington, D.C. pursuant to the Commission's Rule 14a-6.
 
                                       66

<PAGE>   68
 

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
                                  ON SCHEDULES
 
To PerkinElmer, Inc.:
 
     We have audited in accordance with generally accepted auditing standards,
the consolidated financial statements of PerkinElmer, Inc. included in this Form
10-K and have issued our report thereon dated January 25, 2000. Our audit was
made for the purpose of forming an opinion on the basic financial statements
taken as a whole. Schedule II is the responsibility of the Company's management
and is presented for purposes of complying with the Securities and Exchange
Commission's rules and is not part of the basic financial statements. The
schedule has been subjected to the auditing procedures applied in the audit 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.
 
/s/ ARTHUR ANDERSEN LLP
--------------------------------
Arthur Andersen LLP
Boston, Massachusetts
January 25, 2000

 
                                       67

<PAGE>   69
 
                                  SCHEDULE II
 
                       PERKINELMER, INC. AND SUBSIDIARIES
 
                       VALUATION AND QUALIFYING ACCOUNTS
                   FOR THE THREE YEARS ENDED JANUARY 2, 2000
                                 (IN THOUSANDS)
 

<TABLE>
<CAPTION>
                                      BALANCE AT                                             BALANCE
                                     BEGINNING OF                  CHARGES/                  AT END
DESCRIPTION                              YEAR        PROVISIONS    WRITEOFFS     OTHER       OF YEAR
-----------                          ------------    ----------    ---------    -------      -------
<S>                                  <C>             <C>           <C>          <C>          <C>
RESERVE FOR DOUBTFUL ACCOUNTS
Year Ended December 28, 1997.......    $ 4,126        $ 2,090      $ (1,211)    $  (295)     $ 4,710
Year Ended January 3, 1999.........    $ 4,710        $ 1,084      $   (960)    $  (434)(a)  $ 4,400
Year Ended January 2, 2000.........    $ 4,400        $ 2,569      $ (1,302)    $ 7,261(b)   $12,928
ACCRUED RESTRUCTURING COSTS
Year Ended December 28, 1997.......    $    --        $ 4,433      $ (1,408)    $    --      $ 3,025
Year Ended January 3, 1999.........    $ 3,025        $50,027      $(23,483)    $ 5,000(c)   $34,569
Year Ended January 2, 2000.........    $34,569        $11,520(e)   $(32,525)    $28,195(d)   $41,759
</TABLE>

 
---------------
(a) Includes reserves for doubtful accounts of $1,371 related to companies
    acquired in 1998.
 
(b) Includes reserve for doubtful accounts of $6,500 related to a company
    acquired in 1999.
 
(c) Represents accrued restructuring costs of $5,000 related to a company
    acquired in 1998.
 
(d) Represents accrued restructuring costs of $28,195 related to a company
    acquired in 1999.
 
(e) Includes a $23,500 restructuring charge and an $11,980 reversal of prior
    year's charges.
 
                                       68

<PAGE>   70
 
                   CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
 
     As independent public accountants, we hereby consent to the incorporation
by reference of our reports dated January 25, 2000, included in this Form 10-K,
into Registration Statements previously filed by PerkinElmer, Inc. on,
respectively, Form S-8, File No. 2-98168; Form S-8, File No. 33-36082; Form S-8,
File No. 33-35379; Form S-8, File No. 33-49898; Form S-8, File No. 33-57606;
Form S-8, File No. 33-54785; Form S-8, File No. 33-62805; Form S-8, File No.
333-8811; Form S-8, File No. 333-32059; Form S-8, File No. 333-32463; Form S-3,
File No. 33-59675; Form S-8, File No. 333-50953; Form S-8, File No. 333-56921;
Form S-8, File No. 333-58517; Form S-8, File No. 333-61615; Form S-8, File No.
333-65367; Form S-8, File No. 333-69115; Form S-8, File No. 333-70977; Form S-3,
File No. 333-71069; Form S-8, File No. 333-81759; Form S-4, File No. 333-91535
and Form S-8, File No. 333-30150.
 
/s/ ARTHUR ANDERSEN LLP
---------------------------------------------------------
Arthur Andersen LLP
Boston, Massachusetts
March 28, 2000
 
                               POWER OF ATTORNEY
 
     We, the undersigned officers and directors of PerkinElmer, Inc., hereby
severally constitute Gregory L. Summe, and Terrance L. Carlson, and each of them
singly, our true and lawful attorneys with full power to them, and each of them
singly, to sign for us and in our names, in the capacities indicated below, this
Annual Report on Form 10-K and any and all amendments to said Annual Report on
Form 10-K, and generally to do all such things in our name and behalf in our
capacities as officers and directors to enable PerkinElmer, Inc. to comply with
the provisions of the Securities Exchange Act of 1934, and all requirements of
the Securities and Exchange Commission, hereby rectifying and confirming signed
by our said attorneys, and any and all amendments thereto.
 
     Witness our hands on the date set forth below.
 

                                   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.
 
                                          PERKINELMER, INC.
 

<TABLE>
<CAPTION>
                     SIGNATURE                                    TITLE                      DATE
                     ---------                                    -----                      ----
<S>                                                  <C>                                <C>
By: /s/ GREGORY L. SUMME                             Chairman of the Board, Chief       March 28, 2000
                                                     Executive Officer and President
--------------------------------------------------   (Principal Executive Officer)
    Gregory L. Summe
 
By: /s/ ROBERT F. FRIEL                              Senior Vice President and Chief    March 28, 2000
                                                     Financial Officer (Principal
--------------------------------------------------   Financial Officer)
    Robert F. Friel
 
By: /s/ GREGORY D. PERRY                             Vice President, Control and        March 28, 2000
                                                     Treasury (Principal Accounting
--------------------------------------------------   Officer)
    Gregory D. Perry
</TABLE>

 
                                       69

<PAGE>   71
 
     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 DATE INDICATED:
 

<TABLE>
<CAPTION>
                     SIGNATURE                                     TITLE                     DATE
                     ---------                                     -----                     ----
<S>                                                  <C>                                <C>
By: /s/ TAMARA J. ERICKSON                           Director                           March 17, 2000
--------------------------------------------------
    Tamara J. Erickson
 
By: /s/ KENT F. HANSEN                               Director                           March 15, 2000
--------------------------------------------------
    Kent F. Hansen
 
By: /s/ JOHN F. KEANE                                Director                           March 28, 2000
--------------------------------------------------
    John F. Keane
 
By: /s/ NICHOLAS A. LOPARDO                          Director                           March 16, 2000
--------------------------------------------------
    Nicholas A. Lopardo
 
By: /s/ GRETA E. MARSHALL                            Director                           March 28, 2000
--------------------------------------------------
    Greta E. Marshall
 
By: /s/ GABRIEL SCHMERGEL                            Director                           March 28, 2000
--------------------------------------------------
    Gabriel Schmergel
 
By: /s/ MICHAEL C. RUETTGERS                         Director                           March 28, 2000
--------------------------------------------------
    Michael C. Ruettgers
 
By: /s/ GREGORY L. SUMME                             Director                           March 28, 2000
--------------------------------------------------
    Gregory L. Summe
 
By: /s/ JOHN LARKIN THOMPSON                         Director                           March 16, 2000
--------------------------------------------------
    John Larkin Thompson
 
By: /s/ G. ROBERT TOD                                Director                           March 28, 2000
--------------------------------------------------
    G. Robert Tod
</TABLE>

 
                                       70

<PAGE>   72
 

                                 EXHIBIT INDEX
 

<TABLE>
<CAPTION>
EXHIBIT
NUMBER                             EXHIBIT NAME
-------                            ------------
<S>        <C>
 3.1       The Company's Restated Articles of Organization were filed
           with the Commission on March 30, 1999 as Exhibit 3.1 to the
           Company's Annual Report on Form 10-K for the fiscal year
           ended January 3, 1999 and are herein incorporated by
           reference.
 3.2       Articles of Amendment to the Company's Restated Articles of
           Organization were filed with the Commission on November 5,
           1999 as Exhibit 3 to the Company's Report on Form 8-K and
           are herein incorporated by reference.
 3.3       The Company's By-Laws as amended and restated by the Board
           of Directors on April 27, 1999.
 4.1       Specimen Certificate of the Company's Common Stock, $1 par
           value, was filed with the Commission on November 5, 1999 as
           Exhibit 4 to the Company's Report on Form 8-K and is herein
           incorporated by reference.
 4.2       Form of Indenture dated June 28, 1995 between the Company
           and the First National Bank of Boston, as Trustee, was filed
           with the Commission as Exhibit 4.1 to the Company's
           Registration Statement on Form S-3, File No. 33-59675 and is
           herein incorporated by reference.
10.1       The Company's Supplemental Executive Retirement Plan revised
           as of April 19, 1995 was filed as Exhibit 10.1 to the
           Company's Annual Report on Form 10-K for the fiscal year
           ended December 31, 1995, and is herein incorporated by
           reference.
10.2       The Company's 1999 INCENTIVE PLAN was filed with the
           Commission on April 2, 1999 as Exhibit B to the Company's
           Definitive Proxy Statement on Schedule 14A and is herein
           incorporated by reference.
10.3       5-Year Competitive Advance and Revolving Credit Facility
           Agreement (referred to as the "5-Year Agreement") dated as
           of March 21, 1994 among the Company, the Lenders Named
           Herein and The Chase Manhattan Bank as Administrative Agent;
           Amendment No. 1 dated as of March 15, 1995; and Amendment
           No. 2 dated as of March 14, 1996 were filed as Exhibit 10.3
           to the Company's Annual Report on Form 10-K for the fiscal
           year ended December 31, 1995 and are herein incorporated by
           reference. Amendment No. 3 dated as of March 7, 1997 was
           filed as Exhibit 10.3 to the Company's Annual Report on Form
           10-K for the fiscal year ended December 29, 1996 and is also
           herein incorporated by reference. Amendment No. 4 dated as
           of November 20, 1998 was filed as Exhibit 10.3 to the
           Company's Annual Report on Form 10-K for the fiscal year
           ended January 3, 1999 and is also herein incorporated by
           reference.
10.4       $300,000,000 Amended and Restated Competitive Advance and
           Revolving Credit Facility Agreement dated as of March 3,
           2000 among the Company, the Lenders Named Herein and The
           Chase Manhattan Bank as Administrative Agent, which is
           attached hereto as Exhibit 10.4, amends and restates the
           Competitive Advance and Revolving Credit Facility Agreement
           dated as of March 5, 1999 among the Company, the Lenders
           Named Herein and The Chase Manhattan Bank as Administrative
           Agent, which was filed with the Commission as Exhibit 10.4
           to the Company's Annual Report on Form 10-K for the fiscal
           year ended January 3, 1999 and is herein incorporated by
           reference.
10.5(a)    Employment Contract between the Company and Gregory L. Summe
           dated January 8, 1998, as amended by an amendment dated
           November 5, 1999.
10.5(b)    Employment Contract between the Company and Angelo D.
           Castellana dated November 10, 1999.
10.6       The Company's 1982 INCENTIVE STOCK OPTION PLAN was filed as
           Exhibit 4(v) to the Company's Registration Statement on Form
           S-8, File No. 33-36082 and is herein incorporated by
           reference.
10.7       The Company's 1992 STOCK OPTION PLAN was filed as Exhibit
           4(vi) to the Company's Registration Statement on Form S-8,
           File No. 333-32059 and is herein incorporated by reference.
</TABLE>






<PAGE>   1
                                                                     Exhibit 3.3

                            PERKINELMER, INC. BY-LAWS

                              As of April 27, 1999

                                   ARTICLE I.

                                  Stockholders.


          1. Place of Meetings. All meetings of stockholders shall be held
within Massachusetts unless the Articles of Organization permit the holding of
stockholder meetings outside Massachusetts, in which event such meetings may be
held either within or without Massachusetts. Meetings of stockholders shall be
held at the principal office of the corporation unless a different place is
fixed by the Directors or the Chairman of the Board and stated in the notice of
the meeting. (Amended by Directors 4/20/78 and 3/23/83)

          2. Annual Meetings. The annual meeting of stockholders shall be held
on the fourth Tuesday of April in each year (or if that be a legal holiday in
the place where the meeting is to be held, on the next succeeding full business
day) at 10:30 o'clock A.M., unless a different hour is fixed by the Directors or
the Chairman of the Board and stated in the notice of the meeting. The purposes
for which the annual meeting is to be held, in addition to those prescribed by
law, by the Articles of Organization or by these By-Laws, may be specified by
the Directors or the Chairman of the Board. If no annual meeting is held in
accordance with the foregoing
 provisions, a special meeting may be held in lieu
thereof and any action taken at such meeting shall have the same effect as if
taken at the annual meeting. (Amended by Directors, 4/20/78; Amended by
Stockholders, 4/21/83)

          3. Special Meetings. Special meetings of stockholders may be called by
the President or by the Directors. In addition, upon written application of one
or more stockholders who are entitled to vote and who hold at least the Required
Percentage (as defined below) of the capital stock entitled to vote at the
meeting (the "Voting Stock"), special meetings shall be called by the Clerk, or
in case of the death, absence, incapacity or refusal of the Clerk, by any other
officer. For purposes of this Section 3, the "Required Percentage" shall be 40%
or such lesser percentage as shall constitute the maximum percentage permitted
by law for this purpose. Any request for a call of special meeting of
stockholders (a "Call") by the holders of the Required Percentage of the Voting
Stock shall be governed by and subject to the following:

                                      -1-

<PAGE>   2
                (a) Any stockholder of record seeking to solicit requests for a
Call pursuant to this Section 3 shall so notify the corporation in writing to
the Clerk of the corporation, and such written notification shall set forth the
reason or reasons for the Call and the purpose or purposes of such special
meeting.

                (b) No solicitation of stockholder requests for a Call (a "Call
Solicitation") may be commenced (I) before the Call Request Record Date, as
defined in paragraph (c) of this Section 3, or (ii) during the period of 90 days
following the most recent meeting of the stockholders of the corporation.

                (c) In order that the corporation may determine the stockholders
entitled to request a Call, the Board of Directors of the corporation shall fix
a record date (the "Call Request Record Date"). Any stockholder of record
seeking to solicit stockholder requests for a Call shall, with delivery to the
corporation of the written information specified in paragraph (a), request in
writing that the Board of Directors fix the Call Request Record Date. The Board
of Directors shall, within 10 days after the date on which such request is
received, adopt a resolution fixing the Call Request Record Date, and such Call
Request Record Date shall be not more than 10 days after the date upon which
such resolution is adopted by the Board of Directors.

                (d) All requests for a Call and revocations thereof shall be
delivered to the corporation no later than the 30th day (the "Delivery Date")
after the Call Request Record Date.

                (e) Any stockholder may revoke a prior request for a Call or
opposition to a Call by an instrument in writing delivered prior to the Delivery
Date.

                (f) Promptly after the Delivery Date, requests for a Call and
revocations thereof shall be counted and verified by an independent party
selected by the corporation.

                (g) If, in response to any Call Solicitation, the holders of
record of the Required Percentage of the Voting Stock as of the Call Request
Record Date submit valid and unrevoked requests for a Call no later than the
Delivery Date, the Board of Directors of the corporation shall fix a record date
and a meeting date for the special meeting, provided that the date to be fixed
for such meeting shall be no earlier than 60 days or later than 90 days after
the Delivery Date, and provided further that the Board of Directors shall not be
obligated to fix a meeting date or to

                                      -2-

<PAGE>   3
hold any meeting of stockholders within 60 days of the next scheduled meeting of
the stockholders of the corporation.

                (h) In the absence of a quorum at any special meeting called
pursuant to a Call Solicitation, such special meeting may be postponed or
adjourned from time to time only by the officer of the corporation entitled to
preside at such meeting.

                (i) If a Call Solicitation does not receive the support of the
holders of record of the Required Percentage of the Voting Stock, no subsequent
Call may be made or solicited by any stockholder during a period of 90 days
after the Delivery Date. (Amended by Directors, 4/20/78, 3/23/83, 4/24/90 and
4/23/91)

        4. Notice of Meetings. A written notice of every meeting of stock-
holders, stating the place, date and hour thereof, and the purposes for which
the meeting is to be held, shall be given by the Clerk or other person calling
the meeting at least seven days before the meeting to each stockholder entitled
to vote thereat and to each stockholder who, by law, by the Articles of
Organization or by these By-Laws, is entitled to such notice, by leaving such
notice with him or at his residence or usual place of business, or by mailing it
postage prepaid and addressed to him at his address as it appears upon the books
of the corporation. Whenever any notice is required to be given to a stockholder
by law, by the Articles of Organization or by these By-Laws, no such notice need
be given if a written waiver of notice, executed before or after the meeting by
the stockholder or his attorney thereunto duly authorized, is filed with the
records of the meeting.

          5. Quorum. Unless the Articles of Organization otherwise provide, a
majority in interest of all stock issued, outstanding and entitled to vote on
any matter shall constitute a quorum with respect to that matter, except that if
two or more classes of stock are outstanding and entitled to vote as separate
classes, then in the case of each such class a quorum shall consist of a
majority in interest of the stock of that class issued, outstanding and entitled
to vote.

          6. Adjournments. Except as provided in Section 3 of this Article I,
any meeting of stockholders may be adjourned to any other time and to any other
place at which a meeting of stockholders may be held under these By-Laws by the
stockholders present or represented at the meeting, although less than a quorum,
or by any officer entitled to preside or to act as clerk of such meeting, if no
stockholder is present. It shall not be necessary to notify any stockholder of
any adjournment. Any business which could have been transacted at any meeting of

                                      -3-

<PAGE>   4
the stockholders as originally called may be transacted at any adjournment
thereof. (Amended by Directors, 4/24/90)

          7. Voting and Proxies. Each stockholder shall have one vote for each
share of stock entitled to vote held by him of record according to the records
of the corporation and a proportionate vote for a fractional share so held by
him, unless otherwise provided by the Articles of Organization. Stockholders may
vote either in person or by written proxy dated not more than six months before
the meeting named therein. Proxies shall be filed with the clerk of the meeting,
or of any adjournment thereof, before being voted. Except as otherwise limited
therein, proxies shall entitle the persons named therein to vote at any
adjournment of such meeting, but shall not be valid after final adjournment of
such meeting. A proxy with respect to stock held in the name of two or more
persons shall be valid if executed by one of them, unless at or prior to
exercise of the proxy the corporation receives a specific written notice to the
contrary from any one of them. A proxy purported to be executed by or on behalf
of a stockholder shall be deemed valid unless challenged at or prior to its
exercise.

          8. Action at Meeting. When a quorum is present, the vote of a majority
of the stock present or represented and voting on a matter (or if there are two
or more classes of stock entitled to vote as separate classes, then in the case
of each such class, the vote of a majority of the stock of that class present or
represented and voting on a matter), except where a larger vote is required by
law, the Articles of Organization or these By-Laws, shall decide any matter to
be voted on by the stockholders. Any election by stockholders shall be
determined by a plurality of the votes cast by the stockholders entitled to vote
at the election. No ballot shall be required for such election unless requested
by a stockholder present or represented at the meeting and entitled to vote in
the election. The Corporation shall not directly or indirectly vote any share of
its stock. Nothing in this Section shall be construed as limiting the right of
this Corporation to vote shares of stock held directly or indirectly by it in a
fiduciary capacity. In the event that a vote of stockholders of this Corporation
is required to approve an agreement to consolidate this Corporation with another
corporation to form a new corporation, or to merge this Corporation into another
corporation, or to merge or consolidate another corporation into this
Corporation, the vote of two-thirds of each class of stock of this Corporation
outstanding and entitled to vote on the question, voting separately, shall be
necessary for the approval of such agreement.
(Amended by Directors, 5/24/89)

                                      -4-

<PAGE>   5
          9. Action without Meeting. Any action to be taken by stockholders may
be taken without a meeting if all stockholders entitled to vote on the matter
consent to the action by a writing filed with the records of the meetings of
stockholders. Such consent shall be treated for all purposes as a vote at a
meeting.

                                   ARTICLE II.

                                   Directors.

          1. Powers. The business of the corporation shall be managed by a Board
of Directors who may exercise all the powers of the corporation except as
otherwise provided by law, by the Articles of Organization or by these By-Laws.
In the event of a vacancy in the Board of Directors, the remaining Directors,
except as otherwise provided by law, may exercise the powers of the full Board
until the vacancy is filled.

          2. Number and Election. The number of Directors which shall constitute
the whole Board of Directors shall be such number, not less than three nor more
than thirteen, as shall be fixed by vote of the stockholders or the Board of
Directors. During the time periods specified in this Section 2, the Board of
Directors shall be divided into three classes in respect of term of office, each
class to contain, as nearly as possible, one-third of the whole number of the
Board. Of the Board of Directors elected at the Annual Meeting of Stockholders
in 1975, the members of one class shall serve until the Annual Meeting of
Stockholders held two years following their election, and the members of the
third class shall serve until the Annual Meeting of Stockholders held three
years following their election; provided, however, that in each case Directors
shall serve until their successors shall be elected and qualified. At each
Annual Meeting of Stockholders, commencing with the Annual Meeting in 1976
through and including the Annual Meeting in 1995, the successors of the
Directors of the class whose terms expire in that year shall be elected to serve
until the Annual Meeting of Stockholders held three years next following (and
until their successors shall be duly elected and qualified), so that the term of
one class of Directors shall expire in each year. At each Annual Meeting of
Stockholders, commencing with the Annual Meeting in 1996, the successors of the
Directors whose terms expire in that year shall be elected to serve until the
Annual Meeting of Stockholders held in the following year (and until their
successors shall be duly elected and qualified), so that, upon the expiration in
1998 of the terms of the Directors elected at the Annual Meeting in 1995, all
Directors shall be elected to hold office for a one-year term (and until their

                                      -5-

<PAGE>   6
successors shall be duly elected and qualified). (Amended by Directors, 5/16/74
and 1/25/95)

          3. Vacancies. A vacancy in the Board of Directors, however occurring,
unless and until filled by the stockholders, may be filled by the Directors.
(Amended by Directors, 5/16/74 and 1/25/95)

          4. Change in Number of the Board. The number of the Board of Directors
may be increased or decreased and one or more additional Directors elected at
any special meeting of the stockholders or by a vote of a majority of the
Directors then in office. For so long as the Directors are divided into classes
in accordance with the terms of Section 2 of this Article II, Directors who are
elected to fill vacancies, whether or not created by an enlargement of the
Board, shall be apportioned among the classes so as to make all classes as
nearly equal in number as possible. Directors who are elected to fill vacancies,
whether or not created by an enlargement of the Board, shall serve until the
expiration of the term of his or her predecessor and until his or her successor
is duly elected and qualified. No decrease in the number of the Board of
Directors shall shorten the term of any incumbent Directors. (Amended by
Directors, 5/16/74 and 1/25/95)

          5. Resignation and Retirement. Any Director may resign by delivering
his written resignation to the corporation at its principal office or to the
Chairman of the Board, the President, Clerk or Secretary. Such resignation shall
be effective upon receipt unless it is specified to be effective at some other
time or upon the happening of some event. Except in special circumstances
specifically approved by the Board, a Director shall be deemed to have retired
at the Annual Meeting of Stockholders following the date the Director shall have
attained the age of seventy. (Amended by Directors, 5/16/74, 4/20/78 and
12/17/97)

          6. Removal. A Director may be removed from office (a) with or without
cause by a vote of two-thirds of the stock outstanding and entitled to vote in
the election of Directors, provided that the Directors of a class elected by a
particular class of stockholders may be removed only by the vote of two-thirds
of the shares of such class which are outstanding and entitled to vote or (b)
for cause by vote of a majority of the Directors then in office. A Director may
be removed for cause only after reasonable notice and opportunity to be heard
before the body proposing to remove him. (Amended by Stockholders, 4/16/74)

          7. Meetings. Regular meetings of the Directors may be held without
call or notice at such places, within or without Massachusetts, and at such
times as the

                                      -6-

<PAGE>   7
Directors may from time to time determine, provided that any Director who is
absent when such determination is made shall be given notice of the
determination. A regular meeting of the Directors may be held without a call or
notice at the same place as the annual meeting of stockholders, or the special
meeting held in lieu thereof, following such meeting of stockholders.

                Special meetings of the Directors may be held at any time and
place, within or without Massachusetts, designated in a call by the Chairman of
the Board, the President, Treasurer or two or more Directors. (Amended by
Directors, 4/20/78 and 3/23/83)

          8. Notice of Special Meetings. Notice of all special meetings of the
Directors shall be given to each Director by the Secretary, or if there be no
Secretary, by the Clerk, or Assistant Clerk, or in case of the death, absence,
incapacity or refusal of such persons, by the officer or one of the Directors
calling the meeting. Notice shall be given to each Director in person or by
telephone or by telegram sent to his business or home address at least
forty-eight hours in advance of the meeting, or by written notice mailed to his
business or home address at least seventy-two hours in advance of the meeting.
Notice need not be given to any Director if a written waiver of notice, executed
by him before or after the meeting, is filed with the records of the meeting, or
to any Director who attends the meeting without protesting prior thereto or at
its commencement the lack of notice to him. A notice or waiver of notice of a
Directors' meeting need not specify the purposes of the meeting.

          9. Quorum. At any meeting of the Directors, a majority of the
Directors then in office shall constitute a quorum. Less than a quorum may
adjourn any meeting from time to time without further notice.

         10. Action at Meeting. At any meeting of the Directors at which a
quorum is present, the vote of a majority of those present, unless a different
vote is specified by law, by the Articles of Organization or by these By-Laws,
shall be sufficient to take any action.

         11. Action by Consent. Any action by the Directors may be taken without
a meeting if a written consent thereto is signed by all the Directors and filed
with the records of the Directors' meetings. Such consent shall be treated as a
vote of the Directors for all purposes.

                                      -7-

<PAGE>   8
         12. Committees. The Directors may, by vote of a majority of the
Directors then in office, elect from their number an executive committee or
other committees and may by like vote delegate thereto some or all of their
powers except those which by law, the Articles of Organization or these By-Laws
they are prohibited from delegating. Except as the Directors may otherwise
determine, any such committee may make rules for the conduct of its business,
but unless otherwise provided by the Directors or in such rules, its business
shall be conducted as nearly as may be in the same manner as is provided by
these By-Laws for the Directors.

                                  ARTICLE III.

                                    Officers.

          1. Enumeration. The officers of the corporation shall consist of a
Chairman of the Board, President, one or more Vice Presidents, a Treasurer, a
Clerk and such other officers as the Directors may determine. Such other
officers may include, without limiting the foregoing, a Controller and a
Secretary or one or more Assistant Vice Presidents, Assistant Controllers,
Assistant Treasurers, Assistant Clerks and Assistant Secretaries. (Amended by
Directors, 3/25/81 and 3/23/83)

          2. Election. The Chairman of the Board, President, Treasurer and Clerk
shall be elected annually by the Directors at their first meeting following the
annual meeting of stockholders. Other officers may be appointed by the Directors
at such meeting or at any other meeting. The Chief Executive Officer shall also
have the power to appoint Assistant Vice Presidents, Assistant Treasurers,
Assistant Controllers, Assistant Clerks and Assistant Secretaries. (Amended by
Directors, 3/25/81 and 3/23/83)

          3. Qualification. The Chairman of the Board and the President shall be
Directors. No officer need be a stockholder. Any two or more officers may be
held by the same person, provided that the Chairman of the Board and Clerk shall
not be the same person, nor shall the President and Clerk be the same person.
The Clerk shall be a resident of Massachusetts unless the corporation has a
resident agent appointed for the purpose of service of process. Any officer may
be required by the Directors to give bond for the faithful performance of his
duties to the corporation in such amount and with such sureties as the Directors
may determine. (Amended by Directors, 4/20/78 and 3/23/83)

          4. Tenure. Except as otherwise provided by law, by the Articles of
Organization or by these By-Laws, the Chairman of the Board, President,
Treasurer

                                      -8-

<PAGE>   9
and Clerk shall hold office until the first meeting of the Directors following
the annual meeting of stockholders and thereafter until his successor is chose
and qualified; and all other officers appointed by the Directors or by the Chief
Executive Officer shall hold office until the first meeting of the Directors
following the annual meeting of stockholders, unless a different term is
specified in choosing or appointing them. Any officer may resign by delivering
his written resignation to the corporation at its principal office or to the
Chairman of the Board, President, Clerk or Secretary, and such resignation shall
be effective upon receipt unless it is specified to be effective at some other
time or upon the happening of some other event. (Amended by Directors, 3/25/81
and 3/23/83)

          5. Removal. The Directors may remove any officer with or without cause
by a vote or a majority of the entire number of Directors then in office,
provided, that an officer may be removed for cause only after reasonable notice
and opportunity to be heard by the Board of Directors prior to action thereon.

          6. Chairman of the Board. The Directors shall appoint a Chairman of
the Board. When present he shall preside at all meetings of the Directors and
stockholders and shall have such other powers and duties as are usually vested
in the office of Chairman of the Board as well as such other powers and duties
as may be vested in him by the Board of Directors. (Amended by Directors,
4/20/78 and 3/23/83)

          7. President. The President shall have general supervision and control
of all or a substantial portion of the operations of the business, as well as
such other power and duties as may be vested in the President by the Board of
Directors, or the Chief Executive Officer if other than the President. In the
absence of the Chairman of the Board, the President shall preside, when present,
at all meetings of the Directors and stockholders. In the absence or disability
of the Chief Executive Officer, if other than the President, the President shall
perform the duties and exercise the powers of the Chief Executive Officer.
(Amended by Directors, 4/20/78, 3/23/83 and 4/25/89)

          8. Chief Executive Officer. The Board of Directors, shall appoint, as
the Chief Executive Officer of the Company, the President, the Chairman of the
Board, or any other officer of the corporation as the Board of Directors may
deem appropriate. The Chief Executive Officer shall have the ultimate
supervision and control of the operations of the business. (Amended by
Directors, 3/23/83)

                                      -9-

<PAGE>   10
          9. Vice President and Assistant Vice President. Unless otherwise
specified by the Board of Directors, the Vice President, or if there shall be
more than one, the Vice Presidents in the order determined by the Directors,
shall, in the absence or disability of the President, perform the duties and
exercise the powers of the President and shall perform such other duties and
shall have such other powers as the Directors or the Chief Executive Officer may
from time to time prescribe. (Amended by Directors, 3/25/81, 3/23/83 and
11/28/84)

             An Assistant Vice President shall have such duties and powers as
the Directors, the Chief Executive Officer may from time to time prescribe.
(Amended by Directors, 3/25/81 and 3/23/83)

         10. Financial Officers. In addition to the election of a Treasurer, the
Directors may appoint one or more additional financial officers. The Directors
may designate one of the officers as the chief financial officer who, subject to
the direction of the Directors and the Chief Executive Officer, shall have
overall supervision and control of the internal and external financial affairs
of the corporation including financial reporting, and the management of the
assets of the corporation as well as such other powers and duties as may be
vested in him by the Directors or the Chief Executive Officer. He shall have
responsibility, custody and control of all funds, securities and valuable
documents of the corporation except as the Directors may otherwise provide.
(Amended by Directors, 3/23/83)

                The Treasurer shall, subject to the direction of the Directors,
the Chief Executive Officer and the chief financial officer, if there be one,
have general charge of managing the assets of the corporation. He shall perform
such other duties as may be vested in him by the Directors, the Chief Executive
Officer, or the chief financial officer. In the event the Directors have not
designated a chief financial officer, or, if one is designated, in his absence
or disability, the Treasurer shall have custody of all funds, securities and
valuable documents of the corporation except as the Directors may otherwise
provide. (Amended by Directors, 3/23/83)

                The Assistant Treasurer, or if there shall be more than one, the
Assistant Treasurers in the order determined by the Directors, shall in the
absence or disability of the Treasurer, perform the duties and exercise the
powers of the Treasurer and shall perform such other duties and shall have such
other powers as the Directors may from time to time prescribe. (Amended by
Directors, 3/25/81)


                                      -10-

<PAGE>   11
                The Assistant Controller, or if there shall be more than one,
the Assistant Controllers in the order determined by the Directors, shall, in
the absence or disability of the Controller, perform the duties and exercise the
powers of the Controller and shall perform such other duties and shall have such
other powers as the Directors may from time to time prescribe. (Amended by
Directors, 3/25/81)

         11. Clerk and Assistant Clerks. The Clerk shall keep a record of the
meetings of stockholders. Unless a Transfer Agent is appointed, the clerk shall
keep or cause to be kept in Massachusetts, at the principal office of the
corporation or at his office, the stock and transfer records of the corporation,
in which are contained the names of all stockholders and the record address, and
the amount of stock held by each.

                If there is no Secretary or Assistant Secretary, the Clerk shall
keep the record of the meetings of the Directors.

                The Assistant Clerk, or if there shall be more than one, the
Assistant Clerks in the order determined by the Directors, shall, in the absence
or disability of the Clerk, perform the duties and exercise the powers of the
Clerk and shall perform such other duties and shall have such other powers as
the Directors may from time to time prescribe.

         12. Secretary and Assistant Secretaries. If a Secretary is appointed,
he shall attend all meetings of the Directors and shall keep a record of the
meetings of the Directors. He shall, when required, notify the Directors of
their meetings, and shall have such other powers and shall perform such other
duties as the Directors may from time to time prescribe.

                The Assistant Secretary, or if there shall be more than one, the
Assistant Secretaries in the order determined by the Directors, shall in the
absence or disability of the Secretary, perform the duties and exercise the
powers of the Secretary and shall perform such other duties and shall have such
other powers as the Directors may from time to time prescribe.

         13. Other Powers and Duties. Each officer shall, subject to these
By-Laws, have in addition to the duties and powers specifically set forth in
these By-Laws, such duties and powers as are customarily incident to his office,
and such duties and powers as the Directors may from time to time designate.

                                      -11-

<PAGE>   12
                                   ARTICLE IV.

                                 Capital Stock.

          1. Certificates of Stock. Each stockholder shall be entitled to a
certificate of the capital stock of the corporation in such form as may be
prescribed from time to time by the Directors. The certificate shall be signed
by the Chairman of the Board of Directors, the President or a Vice President and
by the Treasurer or any Assistant Treasurer, but when a certificate is
countersigned by a transfer agent or a registrar, other than a Director, officer
of employee of the corporation, such signatures may be facsimiles. In case any
officer who has signed or whose facsimile signature has been placed on such
certificate shall have ceased to be such officer before such certificate is
issued, it may be issued by the corporation with the same effect as if he were
such officer at the time of its issue. (Amended by Directors, 4/20/78 and
1/22/92)

                 Every certificate for shares of stock which are subject to any
restriction on transfer pursuant to the Articles of Organization, the By-Laws or
any agreement to which the corporation is a party, shall have conspicuously
noted on the face or back of the certificate either the full text of the
restriction or a statement of the existence of such restrictions and a statement
that the corporation will furnish a copy thereof to the holder of such
certificate upon written request and without charge. Every certificate issued
when the corporation is authorized to issue more than one class or series of
stock shall set forth on its face or back either the full text of the
preferences, voting powers, qualifications and special and relative rights of
the shares of each class and series authorized to be issued or a statement of
the existence of such preferences, powers, qualifications and rights and a
statement that the corporation will furnish a copy thereof to the holder of such
certificate upon written request and without charge.

          2. Transfers. Subject to the restrictions, if any, stated or noted on
the stock certificates, shares of stock may be transferred on the books of the
corporation by the surrender to the corporation or its transfer agent of the
certificate therefor properly endorsed or accompanied by a written assignment
and power of attorney properly executed, with necessary transfer stamps affixed,
and with such proof of the authenticity of signature as the corporation or its
transfer agent may reasonably require. Except as may be otherwise required by
law, by the Articles of Organization or by these By-Laws, the corporation shall
be entitled to treat the record holder of stock as shown on its books as the
owner of such stock for all purposes, including the payment of dividends and the
right to vote with

                                      -12-

<PAGE>   13
respect thereto, regardless of any transfer pledge or other disposition of such
stock, until the shares have been transferred on the books of the corporation in
accordance with the requirements of these By-Laws.

                It shall be the duty of each stockholder to notify the
corporation of his post office address and of his taxpayer identification
number.

          3. Record Date. The Directors may fix in advance a time not more than
sixty days preceding the date of any meeting of stockholders or the date for the
payment of any dividend or the making of any distribution to stockholders or the
last day on which the consent or dissent of stockholders may be effectively
expressed for any purpose, as the record date for determining the stockholders
having the right to notice of and to vote at such meeting, and any adjournment
thereof, or the right to receive such dividend or distribution or the right to
give such consent or dissent. In such case only stockholders of record on such
record date shall have such right, notwithstanding any transfer of stock on the
books of the corporation after the record date. Without fixing such record date
the Directors may for any of such purposes close the transfer books for all or
any part of such period.

          4. Replacement of Certificates. In case of the alleged loss or
destruction or the mutilation of a certificate of stock, a duplicate certificate
may be issued in place thereof, upon such terms as the Directors may prescribe,
including the presentation of reasonable evidence of such loss, destruction or
mutilation and the giving of such indemnity as the Directors may require for the
protection of the corporation or any transfer agent or registrar.

          5. Issue of Capital Stock. Unless otherwise voted by the stockholders,
the whole or any part of any unissued balance of the authorized capital stock of
the corporation or the whole or any part of the capital stock of the corporation
held in its treasury may be issued or disposed of by vote of the Directors, in
such manner, for such consideration and on such terms as the Directors may
determine.

                                    ARTICLE V

                            Miscellaneous Provisions.

         1. Fiscal Year. The fiscal year of the corporation shall end on the
31st day of December in each year in which such date falls on Sunday, or the
Sunday next preceding or following the 31st day of December in each year, which
ever

                                      -13-

<PAGE>   14
Sunday is nearest to such 31st day of December.

          2. Seal. The seal of the corporation shall, subject to alteration by
the Directors, bear its name, the word "Massachusetts", and the year of its
incorporation.

          3. Execution of Instruments. All deeds, leases, transfers, contracts,
bonds, notes and other obligations authorized to be executed by an officer of
the corporation in its behalf shall be signed by the Chairman of the Board and
Chief Executive Officer or the Treasurer except as the Directors may generally
or in particular cases otherwise determine. (Amended by Directors, 4/20/78)

          4. Voting of Securities. Except as the Directors may otherwise
designate, the Chairman of the Board, the President the chief financial officer,
Treasurer or clerk may waive notice of, and act as, or appoint any person or
persons to act as, proxy or attorney-in-fact for, this corporation (with or
without power of substitution) at any meeting of stockholders or shareholders of
any other corporation or organization, the securities of which may be held by
this corporation. (Amended by Directors, 4/20/78)

          5. Corporate Records. The original, or attested copies, of the
Articles of Organization, By-Laws and records of all meetings of the
incorporators and stockholders, and the stock and transfer records, which shall
contain the names of all stockholders and the record address and the amount of
stock held by each, shall be kept in Massachusetts at the principal office of
the corporation, or at an office of its transfer agent or of the Clerk. Said
copies and records need not all be kept in the same office. They shall be
available at all reasonable times to the inspection of any stockholder for any
proper purpose, but not to secure a list of stockholders for the purpose of
selling said list or copies thereof or of using the same for a purpose other
than in the interest of the applicant, as a stockholder, relative to the affairs
of the corporation.

          6. Evidence of Authority. A certificate by the Clerk or Secretary, or
an Assistant Clerk or Assistant Secretary, or a temporary Clerk or temporary
Secretary, as to any action taken by the stockholders, Directors, Executive
Committee or any officer or representative of the corporation shall as to all
persons who rely thereon in good faith be conclusive evidence of such action.


          7. Articles of Organization. All references in these By-Laws to the
Articles

                                      -14-

<PAGE>   15
of Organization shall be deemed to refer to the Articles of Organization of the
corporation, as amended and in effect from time to time.

          8. Transactions with Interested Parties. In the absence of fraud, no
contract or other transaction between this corporation and any other corporation
or any firm, association, partnership or person shall be affected or invalidated
by the fact that any Director or officer of this corporation is pecuniarily or
otherwise interested in or is a director, member or officer of such other
corporation or of such firm, association or partnership or is a party to or is
pecuniarily or otherwise interested in such contract or other transaction or is
in any way connected with any person or persons, firm, association, partnership
or corporation pecuniarily or otherwise interested therein; provided that the
fact that he individually or as a director, member or officer of such
corporation, firm, association or partnership is such a party or is so
interested shall be disclosed to or shall have been known by the Board of
Directors or a majority of the Board of Directors at which action upon any such
contract or transaction shall be taken; any Director may be counted in
determining the existence of a quorum and may vote at any meeting of the Board
of Directors of this corporation for the purpose of authorizing any such
contract or transaction with like force and effect as if he were not so
interested, or were not a director, member or officer of such other corporation,
firm, association or partnership, provided that any vote with respect to such
contract or transaction must be adopted by a majority of the Directors then in
office who have no interest in such contract or transaction.

INDEMNIFICATION

         9.(a) Actions, Suits and Proceedings. The corporation shall indemnify
each 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, by reason of the fact that he is or
was, or has agreed to become, a director or officer of the corporation, or is or
was serving, or has agreed to serve, at the request of the corporation, as a
director or officer of, or in a similar capacity with, another organization or
in any capacity with respect to any employee benefit plan of the corporation
(all such persons being referred to hereafter as an "Indemnitee"), or by reason
of any action alleged to have been taken or omitted in such capacity, against
all expenses (including attorneys' fees), judgments and fines incurred by him or
on his behalf in connection with such action, suit or proceeding and any appeal
therefrom, unless the Indemnitee shall be finally adjudicated in such action,
suit or proceeding not to have acted in good faith in the reasonable belief that
his action was in the best interests of the corporation

                                      -15-

<PAGE>   16
or, to the extent such matter relates to service with respect to an employee
benefit plan, in the best interests of the participants or beneficiaries of such
employee benefit plan. Notwithstanding anything to the contrary in this Article,
except as set forth in Section 6 below, the corporation shall not indemnify an
Indemnitee seeking indemnification in connection with a proceeding (or part
thereof) initiated by the Indemnitee unless the initiation thereof was approved
by the Board of Directors of the corporation. Notwithstanding anything to the
contrary in this Article, the corporation shall not indemnify an Indemnitee to
the extent such Indemnitee is reimbursed from the proceeds of insurance, and in
the event the corporation makes any indemnification payments to an Indemnitee
and the Indemnitee is subsequently reimbursed from the proceeds of insurance,
such Indemnitee shall promptly refund such indemnification payments to the
corporation to the extent of such insurance reimbursement.

         (b) Settlements. The right to indemnification conferred in this Article
shall include the right to be paid by the corporation for amounts paid in
settlement of any such action, suit or proceeding and any appeal therefrom, and
all expenses (including attorneys' fees) incurred in connection with such
settlement, pursuant to a consent decree or otherwise, unless and to the extent
it is determined pursuant to Section 5 below that the Indemnitee did not act in
good faith in the reasonable belief that his action was in the best interests of
the corporation or, to the extent such matter relates to service with respect to
an employee benefit plan, in the best interests of the participants or
beneficiaries of such employee benefit plan.

         (c) Notification and Defense of Claim. As a condition precedent to his
right to be indemnified, the Indemnitee must notify the corporation in writing
as soon as practicable of any action, suit, proceeding or investigation
involving him for which indemnity will or could be sought. With respect to any
action, suit, proceeding or investigation of which the corporation is so
notified, the corporation will be entitled to participate therein at its own
expense and/or to assume the defense thereof at its own expense, with legal
counsel reasonably acceptable to the Indemnitee. After notice from the
corporation to the Indemnitee of its election so to assume such defense, the
corporation shall not be liable to the Indemnitee for any legal or other
expenses subsequently incurred by the Indemnitee in connection with such claim,
other than as provided below in this Section 3. The Indemnitee shall have the
right to employ his own counsel in connection with such claim, but the fees and
expenses of such counsel incurred after notice from the corporation of its
assumption of the defense thereof shall be at the expense of the Indemnitee
unless (i) the employment of counsel by the Indemnitee has been authorized by
the corporation, (ii) counsel to the Indemnitee shall have reasonably concluded
that

                                      -16-

<PAGE>   17
there may be a conflict of interest or position on any significant issue between
the corporation and the Indemnitee in the conduct of the defense of such action
or (iii) the corporation shall not in fact have employed counsel to assume the
defense of such action, in each of which cases the fees and expenses of counsel
for the Indemnitee shall be at the expense of the corporation, except as
otherwise expressly provided by this Article. The corporation shall not be
entitled, without the consent of the Indemnitee, to assume the defense of any
claim brought by or in the right of the corporation or as to which counsel for
the Indemnitee shall have reasonably made the conclusion provided for in clause
(ii) above.

         (d). Advance of Expenses. Subject to the provisions of Section 5 below,
in the event that the corporation does not assume the defense pursuant to
Section 3 of this Article of any action, suit, proceeding or investigation of
which the corporation receives notice under this Article, any expenses
(including attorneys' fees) incurred by an Indemnitee in defending a civil or
criminal action, suit, proceeding or investigation or any appeal therefrom shall
be paid by the corporation in advance of the final disposition of such matter;
provided, however, that the payment of such expenses incurred by an Indemnitee
in advance of the final disposition of such matter shall be made only upon
receipt of an undertaking by or on behalf of the Indemnitee to repay all amounts
so advanced in the event that it shall ultimately be determined that the
Indemnitee is not entitled to be indemnified by the corporation as authorized in
this Article. Such undertaking shall be accepted without reference to the
financial ability of the Indemnitee to make such repayment.

         (e). Procedure for Indemnification. In order to obtain indemnification
or advancement of expenses pursuant to Section 1, 2 or 4 of this Article, the
Indemnitee shall submit to the corporation a written request, including in such
request such documentation and information as is reasonably available to the
Indemnitee and is reasonably necessary to determine whether and to what extent
the Indemnitee is entitled to indemnification or advancement of expenses. Any
such indemnification or advancement of expenses shall be made promptly, and in
any event within 60 days after receipt by the corporation of the written request
of the Indemnitee, unless the corporation determines within such 60-day period
that the Indemnitee did not meet the applicable standard of conduct set forth in
Section 1 or 2, as the case may be. Such determination shall be made in each
instance by (a) a majority vote of a quorum of the directors of the corporation,
(b) a majority vote of a quorum of the outstanding shares of stock of all
classes entitled to vote for directors, voting as a single class, which quorum
shall consist of stockholders who are not at that time parties to the action,
suit or proceeding in

                                      -17-

<PAGE>   18
question, (c) independent legal counsel (who may, to the extent permitted by
law, be regular legal counsel to the corporation), or (d) a court of competent
jurisdiction.

         (f) Remedies. The right to indemnification or advances as granted by
this Article shall be enforceable by the Indemnitee in any court of competent
jurisdiction if the corporation denies such request, in whole or in part, or if
no disposition thereof is made within the 60-day period referred to above in
Section 5. Unless otherwise required by law, the burden of proving that the
Indemnitee is not entitled to indemnification or advancement of expenses under
this Article shall be on the corporation. Neither the failure of the corporation
to have made a determination prior to the commencement of such action that
indemnification is proper in the circumstances because the Indemnitee has met
the applicable standard of conduct, nor an actual determination by the
corporation pursuant to Section 5 that the Indemnitee has not met such
applicable standard of conduct, shall be a defense to the action or create a
presumption that the Indemnitee has not met the applicable standard of conduct.
The Indemnitee's expenses (including attorneys' fees) incurred in connection
with successfully establishing his right to indemnification, in whole or in
part, in any such proceeding shall also be indemnified by the corporation.

         (g) Subsequent Amendment. No amendment, termination or repeal of this
Article or of the relevant provisions of Chapter 156B of the Massachusetts
General Laws or any other applicable laws shall affect or diminish in any way
the rights of any Indemnitee to indemnification under the provisions hereof with
respect to any action, suit, proceeding or investigation arising out of or
relating to any actions, transactions or facts occurring prior to the final
adoption of such amendment, termination or repeal.

         (h) Other Rights. The indemnification and advancement of expenses
provided by this Article shall not be deemed exclusive of any other rights to
which an Indemnitee seeking indemnification or advancement of expenses may be
entitled under any law (common or statutory), agreement or vote of stockholders
or directors or otherwise, both as to action in his official capacity and as to
action in any other capacity while holding office for the corporation, and shall
continue as to an Indemnitee who has ceased to be a director or officer, and
shall inure to the benefit of the estate, heirs, executors and administrators of
the Indemnitee. Nothing contained in this Article shall be deemed to prohibit,
and the corporation is specifically authorized to enter into, agreements with
officers and directors providing indemnification rights and procedures different
from those set forth in this Article. In addition, the corporation may, to the
extent authorized from time to time

                                      -18-

<PAGE>   19
by its Board of Directors, grant indemnification rights to other employees or
agents of the corporation or other persons serving the corporation and such
rights may be equivalent to, or greater or less than, those set forth in this
Article.

         (i) Partial Indemnification. If an Indemnitee is entitled under any
provision of this Article to indemnification by the corporation for some or a
portion of the expenses (including attorneys' fees), judgments, fines or amounts
paid in settlement actually and reasonably incurred by him or on his behalf in
connection with any action, suit, proceeding or investigation and any appeal
therefrom but not, however, for the total amount thereof, the corporation shall
nevertheless indemnify the Indemnitee for the portion of such expenses
(including attorneys' fees), judgments, fines or amounts paid in settlement to
which the Indemnitee is entitled.

         (j) Insurance. The corporation may purchase and maintain insurance, at
its expense, to protect itself and any director, officer, employee or agent of
the corporation or another organization or employee benefit plan against any
expense, liability or loss incurred by him in any such capacity, or arising out
of his status as such, whether or not the corporation would have the power to
indemnify such person against such expense, liability or loss under Chapter 156B
of the Massachusetts General Laws.

         (k) Merger or Consolidation. If the corporation is merged into or
consolidated with another corporation and the corporation is not the surviving
corporation, the surviving corporation shall assume the obligations of the
corporation under this Article with respect to any action, suit, proceeding or
investigation arising out of or relating to any actions, transactions or facts
occurring prior to the date of such merger or consolidation.

         (l) Savings Clause. If this Article or any portion hereof shall be
invalidated on any ground by any court of competent jurisdiction, then the
corporation shall nevertheless indemnify each Indemnitee as to any expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement in
connection with any action, suit, proceeding or investigation, whether civil,
criminal or administrative, including an action by or in the right of the
corporation, to the fullest extent permitted by any applicable portion of this
Article that shall not have been invalidated and to the fullest extent permitted
by applicable law.

         (m) Subsequent Legislation. If the Massachusetts General Laws are
amended after adoption of this Article to expand further the indemnification
permitted to Indemnitees, then the corporation shall indemnify such persons to
the

                                      -19-

<PAGE>   20
fullest extent permitted by the Massachusetts General Laws, as so amended.
(Amended by Directors 4/27/99)

         10. Amendments. The stockholders may by a vote of two-thirds of the
stock of the corporation, outstanding and entitled to vote, make, amend or
repeal the By-Laws of the corporation in whole or in part at any meeting of the
stockholders provided that notice of the substance of the proposed action is
stated in the notice of meeting. The Directors may make, amend or repeal the
By-Laws of the corporation in whole or in part at any meeting of the Directors
by vote of a majority of the Directors then in office, except that the
provisions thereof fixing the place of the meetings of stockholders, fixing the
date of the annual meeting of stockholders, designating the number necessary to
constitute a quorum at meetings of the stockholders, governing procedure with
respect to the removal of Directors, affording indemnification to Directors or
officers and governing amendment of these By-Laws, may be made, amended, or
repealed only by the stockholders. No change in the date of the annual meeting
may be made within sixty days before the date fixed in these By-Laws, and in
case of any change of such date, notice thereof shall be given to each
stockholder in person or by letter mailed to his last known post office address
at least twenty days before the new date fixed for such meeting.

         11. 1987 Massachusetts Control Share Acquisition Act. The 1987
Massachusetts Control Share Acquisition Act, Chapter 110D of the Massachusetts
General Laws, as it may be amended from time to time, shall not apply to the
corporation. (Amended by Directors, 9/23/87 and 1/25/95)

                                      -20-



<PAGE>   1
                                                                    EXHIBIT 10.4


                                          $300,000,000 AMENDED AND RESTATED
                               COMPETITIVE ADVANCE AND REVOLVING CREDIT FACILITY
                               AGREEMENT dated as of March 3, 2000 (the "Amended
                               and Restated Credit Agreement"), among
                               PERKINELMER, INC. (formerly known as "EG&G,
                               Inc.") (the "Borrower"), the LENDERS listed on
                               the signature pages hereof and THE CHASE
                               MANHATTAN BANK, as Administrative Agent.WHEREAS,
                               the Borrower, certain Lenders and the
                               Administrative Agent are parties to the
                               $250,000,000 Competitive Advance and Revolving
                               Credit Facility Agreement dated as of March 5,
                               1999 (the "Credit Agreement");

          WHEREAS, the Borrower has requested that the Lenders amend and restate
the Credit Agreement;

          WHEREAS, the undersigned Lenders are willing, on the terms and subject
to the conditions set forth herein, to agree to such amendment and restatement;
and

          WHEREAS, each capitalized term used but not defined herein shall have
the meaning assigned to it in the Credit Agreement as amended and restated
hereby;

          NOW, THEREFORE, in consideration of the premises, the Borrower and the
undersigned Lenders hereby agree as follows:

          SECTION 1. AMENDMENT AND RESTATEMENT. Effective as of the date hereof
(but subject to the conditions set forth in Section 3), the Credit Agreement is
hereby amended and restated in the form of a new agreement (this "Amended and
Restated Credit Agreement") identical to the Credit Agreement, which is
incorporated by reference herein as modified by the following amendments, and
all rights and obligations of the Borrower, the Lenders and the Agent under the
Credit Agreement (including
 accrued interest and fees) shall continue as so
modified as rights and obligations of such parties under this Amended and
Restated Credit Agreement:

          (a) The name "EG&G, Inc." in the Credit Agreement is hereby replaced
with "PerkinElmer, Inc.".

          (b) The aggregate principal amount of the Lenders' Commitments set
forth in the preamble of the Credit Agreement is hereby changed from "principal
amount not in excess of 


<PAGE>   2
                                                                               2

$250,000,000" to "principal amount not in excess of $300,000,000".

          (c) The definition of "Maturity Date" in Section 1.01 of the Credit
Agreement is hereby replaced in its entirety with the following:

          "MATURITY DATE" shall mean March 1, 2002.

          (d) The definition of "Termination Date" in Section 1.01 of the Credit
Agreement is hereby replaced in its entirety with the following:

          "TERMINATION DATE" shall mean March 2, 2001.

          (e) The reference to the date "March 31, 1999" in Section 2.05 of the
Credit Agreement is hereby replaced with "March 31, 2000".

          (f) Section 2.13(b) of the Credit Agreement is hereby amended by: (i)
deleting the phrase "compliance by any Lender (or any lending office of such
Lender)" and inserting in place thereof "compliance by any Lender or any entity
controlling a Lender (or any lending office of such Lender or entity controlling
such Lender)" and (ii) deleting the phrase "reducing the rate of return on such
Lender's capital as a consequence of this Agreement" and substituting it with
"reducing the rate of return on such Lender's capital (or the capital of an
entity controlling such Lender) as a consequence of this Agreement".

          (g) Section 2.18(a) of the Credit Agreement is hereby amended by
inserting before the period at the end of the subsection ", without setoff,
counterclaim or other deductions".

          (h) In Section 3.04(a) of the Credit Agreement, the phrase "The
unaudited consolidated balance sheet of the Company and its Consolidated
Subsidiaries as of January 3, 1999," is hereby deleted and replaced with "The
unaudited consolidated balance sheet of the Company and its Consolidated
Subsidiaries as of January 3, 2000".

          (i) All references to the date "September 27, 1998" in Section 3.04(b)
of the Credit Agreement are hereby replaced with "September 30, 1999".

          (j) Section 3.13 of the Credit Agreement is hereby deleted and
replaced in its entirety with the following:

          "Section 3.13. YEAR 2000. There has not occurred, and the Borrower
     does not expect that there will occur, any material disruption in the
     operations or business systems of the Borrower or its Subsidiaries
     resulting from the


<PAGE>   3
                                                                               3

     inability of computer systems of the Borrower and its Subsidiaries or
     equipment containing embedded microchips to recognize or properly process
     dates in or following the year 2000."

          (k) The reference to the date "January 3, 1999" in Section 3.14 of the
Credit Agreement is hereby replaced with "September 30, 1999".

          (l) Section 4.02(e) of the Credit Agreement is hereby deleted and
replaced in its entirety with the following:
          "(e) No Loan shall be outstanding under the $250,000,000 Competitive
     Advance and Revolving Credit Facility Agreement dated as of March 5, 1999."

          (m) Section 9.13(c) of the Credit Agreement is hereby amended by
deleting the phrase "Each party to this Agreement irrevocably consents to
service of process in the manner provided for notices in Section 9.01." and
replacing it with "Each Borrower hereby irrevocably consents to service of
process in the manner provided for notices in Section 9.01."

          (n) Section 9.16(e) of the Credit Agreement is hereby deleted and
replaced in its entirety with the following:

          "(e) to any Affiliate of or any actual or prospective assignee or
participant in any rights of such Lender or the Administrative Agent under this
Agreement, provided that such Affiliate, assignee or participant delivers to the
Administrative Agent or such Lender, as applicable, a confidentiality letter
containing substantially the undertakings set forth in this Section 9.16 and".

          (o) Schedules 2.01 and 3.08 to the Credit Agreement are hereby
replaced with the Schedules 2.01 and 3.08 attached to this Amended and Restated
Credit Agreement.

          (p) All references in the Credit Agreement to "the date hereof" or
"the date of this Agreement", and all similar references to the date of the
Credit Agreement, shall be deemed references to the date of this Amended and
Restated Credit Agreement.

          (q) The Exhibits to the Credit Agreement are hereby amended by
replacing the references to the "$250,000,000 Competitive Advance and Revolving
Credit Facility Agreement dated as of March 5, 1999 (as amended, modified,
extended or restated from time to time, the "Agreement")" with references to the
"$300,000,000 Amended and Restated Competitive Advance and Revolving Credit
Facility Agreement dated as of March 3, 2000 (the "Agreement")" and by replacing
any other references therein to March 5, 1999, with references to March 3, 2000.



<PAGE>   4
                                                                               4

Additionally, all references to "EG&G, Inc." in the Exhibits to the Credit
Agreement are hereby replaced with "PerkinElmer, Inc." The reference to "the
Competitive Advance and Revolving Credit Facility Agreement dated as of March 5,
1999" in Exhibit D-1 to the Credit Agreement is hereby replaced with "the
Amended and Restated Competitive Advance and Revolving Credit Facility Agreement
dated as of March 3, 2000". The reference to "the 5-Year Competitive Advance and
Revolving Credit Facility Agreement dated as of March 21, 1994 and the
Competitive Advance and Revolving Credit Facility Agreement dated as of March 5,
1999" in Exhibit D-2 to the Credit Agreement is hereby replaced with "the 5-Year
Competitive Advance and Revolving Credit Facility Agreement dated as of March
21, 1994 and the Amended and Restated Competitive Advance and Revolving Credit
Facility Agreement dated as of March 3, 2000".

          SECTION 2. REPRESENTATIONS AND WARRANTIES. The representations and
warranties set forth in Article III of the Credit Agreement, as amended by this
Amended and Restated Credit Agreement, shall be deemed to have been repeated in
this Amended and Restated Credit Agreement on and as of the date hereof, with
all references to "this Agreement", "hereof" and "hereunder", and all similar
references, being deemed to refer to this Amended and Restated Credit Agreement.

          SECTION 3. EFFECTIVENESS. This Amended and Restated Credit Agreement
shall become effective on the date hereof, subject to the satisfaction on and as
of the date hereof of the conditions set forth in Section 4.02 of the Credit
Agreement as amended hereby, with references in such Section 4.02 to "hereunder"
meaning "under this Amended and Restated Credit Agreement" and references to
"this Agreement" meaning this Amended and Restated Credit Agreement.

          SECTION 4. APPLICABLE LAW. This Amended and Restated Credit Agreement
shall be construed in accordance with and governed by the law of the State of
New York.

          SECTION 5. COUNTERPARTS. This Amended and Restated Credit Agreement
may be executed in two or more counterparts, each of which shall constitute an
original, but all of which when taken together shall constitute but one
contract. Delivery of an executed counterpart of a signature page of this
Amended and Restated Credit Agreement by facsimile transmission shall be as
effective as delivery of a manually executed counterpart of this Amended and
Restated Credit Agreement.

          SECTION 6. HEADINGS. Section headings used herein are for convenience
of reference only, are not part of this Amended and Restated Credit Agreement
and are not to affect the construction of, or to be taken into consideration in
interpreting, this Amended and Restated Credit Agreement.



<PAGE>   5
                                                                               5

          SECTION 7. EXPENSES. The Borrower shall reimburse the Agent for its
expenses in connection with this Amended and Restated Credit Agreement as
separately agreed in writing with the Agent.

          IN WITNESS WHEREOF, the Borrower, the Administrative Agent and the
undersigned Lenders have caused this Amended and Restated Credit Agreement to be
duly executed by their duly authorized officers, all as of the date first above
written.

                                          PERKINELMER, INC.,

                                            by
                                                  /s/  Gregory D. Perry
                                                 ----- -----------------------
                                                 Name:   Gregory D. Perry
                                                 Title: VP Control & Treasury

                                          THE CHASE MANHATTAN BANK,
                                          individually and as Administrative
                                          Agent,

                                            by
                                                  /s/  Robert T. Sacks
                                                 ----- -----------------------
                                                 Name:   Robert T. Sacks
                                                 Title: Managing Director

                                          ABN AMRO BANK N.V.,

                                            by
                                                  /s/  James E. Davis
                                                 ----- -----------------------
                                                 Name:   James E. Davis
                                                 Title: Group Vice President

                                            by
                                                  /s/  Ildiko E. Juhasz
                                                 ----- -----------------------
                                                 Name:   Ildiko E. Juhasz
                                                 Title: Assistant VP

<PAGE>   6
                                                                               6


                                          BANCA NAZIONALE DEL LAVORO S.p.A.

                                            by
                                                  /s/  Giulio Giovine
                                                 ----- -----------------------
                                                 Name:   Giulio Giovine
                                                 Title: Vice President

                                            by
                                                  /s/  Leonardo Valentini
                                                 ----- -----------------------
                                                 Name:   Leonardo Valentini
                                                 Title: First Vice President

                                          BANK ONE, NA (main office Chicago),

                                            by
                                                  /s/  Jeffrey Lubatkin
                                                 ----- -----------------------
                                                 Name:   Jeffrey Lubatkin
                                                 Title: Vice President

                                          BARCLAYS BANK,

                                            by
                                                  /s/  Terance Bullock
                                                 ----- -----------------------
                                                 Name:   Terance Bullock
                                                 Title: Vice President

                                          DRESDNER BANK AG, New York and
                                          Grand Cayman branches,

                                            by
                                                  /s/  Joanna M. Solowski
                                                 ----- -----------------------
                                                 Name:   Joanna M. Solowski
                                                 Title: Vice President

                                            by
                                                  /s/  J. Michael Leffler
                                                 ----- -----------------------
                                                 Name:   J. Michael Leffler
                                                 Title: Senior Vice President

                                          FLEETBOSTON (Boston),

                                            by
                                                  /s/  Jorge A. Schwarz
                                                 ----- -----------------------
                                                 Name:   Jorge A. Schwarz
                                                 Title: Director



<PAGE>   7
                                                                               7


                                          MELLON BANK, N.A.,

                                            by
                                                  /s/  R. Jane Westrich
                                                 ----- -----------------------
                                                 Name:   R. Jane Westrich
                                                 Title: Vice President

                                          NORTHERN TRUST COMPANY (Chicago),

                                            by
                                                  /s/  Michelle D. Griffin
                                                 ----- -----------------------
                                                 Name:   Michelle D. Griffin
                                                 Title: Vice President

                                          SG COWEN (New York),

                                            by
                                                  /s/  Nicolas Guerin
                                                 ----- -----------------------
                                                 Name:   Nicolas Guerin
                                                 Title: Vice President

                                          STANDARD CHARTERED BANK, (New York),

                                            by
                                                  /s/  Natalie Yang
                                                 ----- -----------------------
                                                 Name:   Natalie Yang
                                                 Title: VP Corporate Banking

                                            by
                                                  /s/  Andrew Ng
                                                 ----- -----------------------
                                                 Name:   Andrew Ng
                                                 Title: VP Credit Doc. Manager

                                          WACHOVIA BANK, N.A.,

                                            by
                                                  /s/  Sharon L. Prince
                                                 ----- -----------------------
                                                 Name:   Sharon L. Prince
                                                 Title: Vice President



<PAGE>   1
                                                                 Exhibit 10.5(a)


                       AMENDMENT TO EMPLOYMENT AGREEMENT
                       ---------------------------------

     This Amendment made as of the 5th day of November, 1999, to an Employment
Agreement made as of the 8th day of January, 1998 between EG&G, Inc., now
PerkinElmer, Inc., a Massachusetts corporation (hereinafter called the
"Company"), and Gregory L. Summe (hereinafter referred to as the "Employee").

                                  WITNESSETH:
                                  -----------

     WHEREAS, the Employee and the Company entered into an Employment Agreement
dated as of the 8th day of January, 1998; and

     WHEREAS, the Employee and the Company wish to amend said Employment
Agreement; and

     NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the parties agree as follows, effective as of the date hereof:

     1.   Paragraph 6(a)(iv) of the Employment Agreement is hereby amended to
          read in its entirety as follows:

              Paragraph 5g shall be amended to read in its entirety as follows:

              "Notwithstanding the foregoing provisions, if, within 36 months
              following the occurrence of a Change in Control, the Employee's
              employment by the Company is terminated (A) by the Company other
              than for Cause, which shall not include any failure to perform his
              duties hereunder after giving notice or termination for Good
              Reason, disability or death or (B) by the Employee for Good
              Reason, (1) the Company shall pay to the Employee, on the date of
              his employment termination, a lump sum cash payment in an amount
              equal to the sum of (x) his unpaid base salary through the date of
              termination, (y) pro rata portion of prior year's bonus and (z)
              his Full Salary (as defined
 below) multiplied by three and (2) the
              Employee shall for 36 months



                                        1
                       Amendment to Employment Agreement



<PAGE>   2


          following the occurrence of the Change in Control be eligible to
          participate in all employee benefit plans and arrangements of the
          Company (such as life, health and disability insurance and automobile
          arrangements but excluding incentive arrangements and grants of stock
          options) to the same extent (including coverage of dependents, if any)
          and upon the same terms as were in effect immediately prior to his
          termination. For purposes of this Agreement, "Full Salary" shall mean
          the Employee's annual base salary, plus the amount of any bonus or
          incentive payments received by the Employee with respect to the last
          full fiscal year of the Company for which all bonus or incentive
          payments to be made have been made. Payments under this Paragraph 5f
          shall be made without regard to whether the deductibility of such
          payments (or any other "parachute payments," as that term is defined
          in Section 280G of the Internal Revenue Code of 1986, as amended (the
          "Code"), to or for the benefit of the Employee) would be limited or
          precluded by Section 280G and without regard to whether such payments
          (or any other "parachute payments" as so defined in said Section 280G)
          would subject the Employee to the federal excise tax levied on
          certain "excess parachute payments" under Section 4999 of the Code
          (the "Excise Tax"). In addition, the Employee shall be entitled to
          receive a payment (the "Gross-Up Payment") which shall be an amount
          equal to the sum of (a) the Excise Tax imposed on any parachute
          payment, whether or not payable under this Agreement, and (b) the
          amount necessary to pay all additional taxes imposed on (or
          economically borne by) the Employee (including the Excise Tax, state
          and federal income taxes and all applicable withholding taxes)
          attributable to the receipt of the Gross-Up Payment, computed assuming
          the application of the maximum tax rates provided by law, so that
          after the payment of all applicable income taxes and excise taxes, the
          Employee will be in the same economic position in which he would have
          been if the Excise Tax had not been applicable. The determination of
          the Gross-Up Payment shall be made


                                        2
                       Amendment to Employment Agreement



<PAGE>   3


              at the Company's expense by Arthur Andersen & Co. or by such other
              certified public accounting firm as the Board of Directors of the
              Company may designate prior to a Change in Control of the Company.
              In the event of any underpayment or overpayment under this
              Paragraph 5g as determined by Arthur Andersen & Co. (or such other
              firm as may have been designated in accordance with the preceding
              sentence), the amount of such underpayment or overpayment shall
              forthwith be paid to the Employee or refunded to the Company, as
              the case may be, with interest at the applicable federal rate
              provided for in Section 7872(f)(2) of the Code."

     2.   Except as provided above, the Employment Contract shall continue in
          full force and effect.

     IN WITNESS WHEREOF, the Company has caused its seal to be hereunto affixed
and these presents to be signed by its proper officers, and the Employee has
hereunto set his hand and seal the day and year first above written.

(SEAL)                             PerkinElmer, Inc.


                                   By: /s/ Terrance L. Carlson
                                       ----------------------------------------
                                   Terrance L. Carlson
                                   SVP, Business Development & General
                                   Counsel


                                   Employee: /s/ Gregory L. Summe
                                       ----------------------------------------




                                        3
                       Amendment to Employment Agreement



<PAGE>   4


                              EMPLOYMENT AGREEMENT
                              --------------------

     This Agreement made as of the 8th day of January, 1998, between EG&G, Inc.,
     a Massachusetts corporation (hereinafter called the "Company"), and Gregory
     L. Summe of Phoenix, Arizona (hereinafter referred to as the "Employee").

                                  WITNESSETH:
                                  -----------
     WHEREAS, the Employee will be employed in a management position with the
     Company; and

     WHEREAS, the Employee hereby agrees to continue to perform such services
     and duties of a management nature as shall be assigned to him; and

     NOW, THEREFORE, in consideration of the sum of One Dollar, and of the
     mutual covenants herein contained, the parties agree as follows:

1.   a)   Except as hereinafter otherwise provided, the Company agrees to employ
          the Employee in a management position with the Company, and the
          Employee agrees to remain in the employment of the Company in that
          capacity for a period of three years from the date hereof and for
          three year terms thereafter until such time as this Agreement is
          terminated.

     b)   The Company will, during each year of the term of this Agreement,
          place in nomination before the Board of Directors of the Company the
          name of the Employee for election as an Officer of the Company except
          when a notice of termination has been given in accordance with
          Paragraph 5(b).

2.   The Employee agrees that, during the specified period of employment, he
     shall, to the best of his ability, perform his duties, and shall not engage
     in any business, profession or occupation which would conflict with the
     rendition of the agreed upon services, either directly or indirectly,
     without the prior approval of the Board of Directors.

3.   During the period of his employment under this Agreement, the Employee
     shall be compensated for his services as follows:

     a)   Except as otherwise provided in this Agreement, he shall be paid a
          salary during the period of this Agreement at a base rate to be
          determined by the Company on an annual basis. Except as Provided in
          Subparagraph 3d, such annual base salary shall under no circumstances
          be fixed at a rate below the annual base rate then currently in
          effect;

     b)   He shall be reimbursed for any and all monies expended by him in
          connection with his employment for reasonable and necessary expenses
          on behalf of the Company in accordance with the policies of the
          Company then in effect;

     c)   He shall be eligible to participate under any and all bonus, benefit,
          pension, compensation, and option plans which are, in accordance with
          company policy, available to persons in his position (within the
          limitation as stipulated by such plans). Such eligibility shall not
          automatically entitle him to participate in any such plan;

     d)   If, because of adverse business conditions or for other reasons, the
          Company at any time puts into effect salary reductions applicable to
          all management employees of the Company generally, the salary payments
          required to be made under this Agreement to the Employee during any
          period in which such general reduction is in effect may be reduced by
          the same percentage as is applicable to all management employees of
          the Company generally. Any benefits made available



                                       1

<PAGE>   5


          to the Employee which are related to base salary shall also be reduced
          in accordance with any salary reduction.

4.   a)   During the period of his employment by the Company or for any period
          which the Company shall continue to pay the Employee his salary under
          this Agreement, whichever shall be the longer, the Employee shall not
          directly or indirectly own, manage, control, operate, be employed by,
          participate in or be connected with the ownership, management,
          operation or control of any business which competes with the Company
          or its subsidiaries, provided, however, that the foregoing shall not
          apply to ownership of stock in a publicly held corporation which
          ownership is disclosed to the Board of Directors nor shall it apply to
          any other relationship which is disclosed to and approved by the Board
          of Directors.

     b)   During the period of his employment by the Company and two years
          following the Company's last payment of salary to him, the Employee
          shall not utilize or disclose to others any proprietary or
          confidential information of any type or description which term shall
          be construed to mean any information developed or identified by the
          Company which is intended to give it an advantage over its competitors
          or which could give a competitor an advantage if obtained by it. Such
          information includes, but is not limited to, product or process
          design, specifications, manufacturing methods, financial or
          statistical information about the Company, marketing or sales
          information about the Company, sources of supply, lists of customers,
          and the Company's plans, strategies, and contemplated actions.

     c)   During the period of his employment by the Company or for any period
          during which the Company shall continue to pay the Employee his salary
          under this Agreement, whichever shall be longer, the Employee shall
          not in any way whatsoever aid or assist any party seeking to cause,
          initiate or effect a Change in Control of the Company as defined in
          Paragraph 6 without the prior approval of the Board of Directors.

5.   Except for the Employee covenants set forth in Paragraph 4 which covenants
     shall remain in effect for the periods stated therein, and subject to
     Paragraph 6, this Agreement shall terminate upon the happening of any of
     the following events and (except as provided herein) all of the Company's
     obligations under this Agreement, including, but not limited to, making
     payments to the Employee shall cease and terminate:

     a)   On the effective date set forth in any resignation submitted by the
          Employee and accepted by the Company, or if no effective date is
          agreed upon, the date of receipt of such letter;

     b)   Three years after written notice of termination is given by either
          party to the other party;

     c)   At the end of the month in which the Employee shall have attained the
          age of sixty-five years;

     d)   At the death of the Employee;

     e)   At the termination of the Employee for cause. As used in the
          Agreement, the term "cause" shall mean:

          i)   Misappropriating any funds or property of the Company;

          ii)  Unreasonable refusal to perform the duties assigned to him under
               this Agreement;

          iii) Conviction of a felony;

          iv)  Violation of the Employee's covenants as set forth in Paragraph 4
               above; or


                                       2


<PAGE>   6


          v)   Continued failure by the Employee to observe any of the
               provisions of this Agreement after being informed of such breach.

     f)   At termination of the Employee by the Company without cause.

     g)   Twelve months after written notice of termination is given by the
          Company to the Employee based on a determination by the Board of
          Directors that the Employee is disabled (which, for purposes of this
          Agreement, shall mean that the Employee is unable to perform his
          regular duties, with such determination to be made by the Board of
          Directors, in reliance upon the opinion of the Employee's physician or
          upon the opinion of one or more physicians selected by the Company).
          Such notice shall be given by the Company to the Employee on the 184th
          day of continuous disability of the Employee. Notwithstanding the
          foregoing, if, during the twelve-month notice period referred to
          above, the Employee is no longer disabled and is able to return to
          work, such notice of employment termination shall be rescinded, and
          the employment of the Employee shall continue in accordance with the
          terms of this Agreement. During the first 184 days of continuous
          disability of the Employee, the Company will make periodic payments to
          the Employee in an amount equal to the difference between his base
          salary and the benefits provided by the Company's Short-Term
          Disability Income Plan. During the twelve-month notice period
          following 184 days of continuous disability, the Company will make
          periodic payments to the Employee in an amount equal to the difference
          between his base salary and the benefits provided by the Company's
          Long-Term Disability Plan. If the employment of the Employee
          terminates at the end of such twelve-month notice period, the Company
          will make periodic payments to the Employee in an amount equal to the
          difference between his base pay and the post-employment benefits
          provided to him under the Company's Long-Term Disability Plan. Due to
          the fact that payments to the Employee under the Company's Long-Term
          Disability Plan are not subject to federal income taxes, the payments
          to be made directly by the Company pursuant to the two preceding
          sentences shall be reduced such that the total amount received by the
          Employee (from the Company and from the Long-Term Disability Plan),
          after payment of any income taxes, is equal to the amount that the
          Employee would have received had he been paid his base salary, after
          payment of any income taxes on such base salary.

     h)   Notwithstanding the foregoing provisions, in the event of the
          termination of the Employee by the Company without cause, the Employee
          shall, until the expiration of his then current employment term or
          three years from the date of such termination, whichever is later, (i)
          continue to receive his Full Salary (as defined below), which shall be
          payable in accordance with the payment schedule in effect immediately
          prior to his employment termination, and (ii) continue to be entitled
          to participate in all employee benefit plans and arrangements of the
          Company (such as life, health and disability insurance and automobile
          arrangements) to the same extent (including coverage of dependents, if
          any) and upon the same terms as were in effect immediately prior to
          his termination. For purposes of this Agreement, "Full Salary" shall
          mean the Employee's annual base salary, plus the amount of any bonus
          or incentive payments received by the Employee with respect to the
          last full fiscal year of the Company for which all bonus or incentive
          payments to be made have been made.

6.   a)   In the event that there is a Change in Control of the Company (as
          defined below), the provisions of this Agreement shall be amended as
          follows:

          i)   Paragraph 1a shall be amended to read in its entirety as follows:

               "Except as hereinafter otherwise provided, the Company agrees to
               continue to employ the Employee in a management position with the
               Company, and the Employee agrees to remain in the employment in
               the Company in that capacity, for a period of five (5) years less
               one day from the date of the Change in Control. Except as
               provided in Paragraph 3d, the Employee's salary as set forth in
               Paragraph 3a and his other employee benefits, pursuant to the
               plans described in Paragraph 3c shall not be decreased during
               such period."


                                       3


<PAGE>   7


          ii)  Paragraph 5a shall be amended by the addition of the following
               provision at the end of such paragraph:

               ", provided that the Employee agrees not to resign, except for
               Good Reason (as defined below), during the one-year period
               following the date of the Change in Control."

          iii) Paragraph 5b shall be deleted in its entirety.

          iv)  Paragraph 5h shall be amended to read in its entirety as follows:

               "Notwithstanding the foregoing provisions, in the event of the
               termination of the Employee by the Company without cause, or the
               resignation of the Employee for Good Reason, the Employee shall
               (i) receive, on the date of his employment termination, a cash
               payment in an amount equal to his Full Salary (as defined below)
               multiplied by the number of years (including any portions
               thereof) remaining until the expiration of his then current
               employment term or five years from the date of such termination,
               whichever is later (it being agreed that such amount shall not be
               discounted based upon the present value of such amount), and (ii)
               continue to be entitled to participate in all employee benefit
               plans and arrangements of the Company (such as life, health and
               disability insurance and automobile arrangements) to the same
               extent (including coverage of dependents, if any) and upon the
               same terms as were in effect immediately prior to his
               termination. For purposes of this Agreement, "Full Salary" shall
               mean the Employee's annual base salary, plus the amount of any
               bonus or incentive payments received by the Employee with respect
               to the last full fiscal year of the Company for which all bonus
               or incentive payments to be made have been made. Payments under
               this Paragraph 5h shall be made without regard to whether the
               deductibility of such payments (or any other "parachute
               payments," as that term is defined in Section 280G of the
               Internal Revenue Code of 1986, as amended (the "Code"), to or for
               the benefit of the Employee) would be limited or precluded by
               Section 280G and without regard to whether such payments (or any
               other "parachute payments" as so defined) would subject the
               Employee to the federal excise tax levied on certain "excess
               parachute payments" under Section 4999 of the Code; provided that
               if the total of all "parachute payments" to or for the benefit of
               the Employee, after reduction for all federal, state and local
               taxes (including the tax described in Section 4999 of the Code,
               if applicable) with respect to such payments (the "Total
               After-Tax Payments"), would be increased by the limitation or
               elimination of any payment under this Paragraph 5h, amounts
               payable under this Paragraph 5h shall be reduced to the extent,
               and only to the extent, necessary to maximize the Total After-Tax
               Payments. The determination as to whether and to what extent
               payments under this Paragraph 5h are required to be reduced in
               accordance with the preceding sentence shall be made at the
               Company's expense by Arthur Andersen & Co. or by such other
               certified public accounting firm as the Board of Directors of the
               Company may designate prior to a Change in Control of the
               Company. In the event of any underpayment or overpayment under
               this Paragraph 5h as determined by Arthur Andersen & Co. (or such
               other firm as may have been designated in accordance with the
               preceding sentence), the amount of such underpayment or
               overpayment shall forthwith be paid to the Employee or refunded
               to the Company, as the case may be, with interest at the
               applicable federal rate provided for in Section 7872(f)(2) of the
               Code."

          v)   Paragraph 8 shall be amended to read in its entirety as follows:

               The Employee may pursue any lawful remedy he deems necessary or
               appropriate for enforcing his rights under this Agreement
               following a Change in Control of the Company, and all costs
               incurred by the Employee in connection therewith (including
               without limitation attorneys' fees) shall be promptly reimbursed
               to him by the


                                       4


<PAGE>   8


               Company, regardless of the outcome of such endeavor.

     b)   For purposes of this Agreement, a "Change in Control of the Company"
          shall occur or be deemed to have occurred only if (i) any "person", as
          such term is used in Section 13(d) and 14(d) of the Securities
          Exchange Act of 1934, as amended (the "Exchange Act") (other than the
          Company, any trustee or other fiduciary holding securities under an
          employee benefit plan of the Company, or any corporation owned
          directly or indirectly by the stockholders of the Company in
          substantially the same proportion as their ownership of stock in the
          Company), is or becomes the "beneficial owner" (as defined in Rule
          13d-3 under the Exchange Act), directly or indirectly, of securities
          of the Company representing 30% or more of the combined voting power
          of the Company's then outstanding securities; (i) during any period
          of two consecutive years ending during the term of this Agreement,
          individuals who at the beginning of such period constitute the Board
          of Directors of the Company, and any new director whose election by
          the Board of Directors or nomination for election by the Company's
          stockholders was approved by a vote of at least two-thirds of the
          directors then still in office who were either directors at the
          beginning of the period or whose election or whose nomination for
          election was previously so approved, cease for any reason to
          constitute a majority of the Board of Directors; (iii) the
          stockholders of the Company approve a merger or consolidation of the
          Company with any other corporation, other than a merger or
          consolidation which would result in the voting securities of the
          Company outstanding immediately prior thereto continuing to represent
          (either by remaining outstanding or by being converted into voting
          securities of the surviving entity) more than 50% of the combined
          voting power of the voting securities of the Company or such surviving
          entity outstanding immediately after such merger or consolidation; or
          (iv) the stockholders of the Company approve a plan of complete
          liquidation of the Company or an agreement for the sale or disposition
          by the Company of all or substantially all of the Company's assets.

     c)   For purposes of this Agreement, "Good Reason" shall mean the
          occurrence of any of the following events, except as provided in
          Paragraph 3d; (i) a reduction in the Employee's base salary as in
          effect on the date hereof or as the same may be increased from time to
          time; (ii) a failure by the Company to pay annual cash bonuses to the
          Employees in an amount at least equal to the most recent annual cash
          bonuses paid to the Employee; (iii) a failure by the Company to
          maintain in effect any material compensation or benefit plan in which
          the Employee participated immediately prior to the Change in Control,
          unless an equitable arrangement has been made with respect to such
          plan, or a failure to continue the Employee's participation therein on
          a basis not materially less favorable than existed immediately prior
          to the Change in Control; (iv) any significant and substantial
          diminution in the Employee's position, duties, responsibilities or
          title as in effect immediately prior to the Change in Control; (v) any
          requirement by the Company that the location at which the Employee
          performs his principal duties be changed to a new location outside a
          radius of 25 miles from the Employee's principal place of employment
          immediately prior to the Change in Control; or (vi) any requirement by
          the Company that the Employee travel on an overnight basis to an
          extent not substantially consistent with the Employee's business
          travel obligations immediately prior to the Change in Control.
          Notwithstanding the foregoing, the resignation shall not be considered
          to be for Good Reason if any such circumstances are fully corrected
          prior to the date of resignation.

7.   Neither the Employee nor, in the event of his death, his legal
     representative, beneficiary or estate, shall have the power to transfer,
     assign, mortgage or otherwise encumber in advance any of the payments
     provided for in this Agreement, nor shall any payments nor assets or funds
     of the Company be subject to seizure for the payment of any debts,
     judgments, liabilities, bankruptcy or other actions.

8.   Any controversy relating to this Agreement and not resolved by the Board of
     Directors and the Employee shall be settled by arbitration in the City of
     Boston, Commonwealth of Massachusetts, pursuant to the rules then obtaining
     of the American Arbitration Association, and judgment upon the award may be
     entered in any court having jurisdiction, and the Board of Directors and
     Employee agree to be bound by the arbitration decision on any such
     controversy. Unless otherwise agreed by the parties hereto, arbitration
     will be by


                                       5

<PAGE>   9


     three arbitrators selected from the panel of the American Arbitration
     Association. The full cost of any such arbitration shall be borne by the
     Company.

9.   Failure to insist upon strict compliance with any of the terms, covenants,
     or conditions hereof shall not be deemed a waiver of such term, covenant,
     or condition, nor shall any waiver or relinquishment of any right or power
     hereunder at any one or more times be deemed a waiver or relinquishment of
     such right or power at any other time or times by either party.

10.  All notices or other communications hereunder shall be in writing and shall
     be deemed to have been duly given when delivered personally to the Employee
     or to the General Counsel of the Company or when mailed by registered or
     certified mail to the other party (if to the Company, at 45 William Street,
     Wellesley, Massachusetts 02481, attention General Counsel; if to the
     Employee, at the last known address of the Employee as set forth in the
     records of the Company).

11.  This Agreement has been executed and delivered and shall be construed in
     accordance with the laws of the Commonwealth of Massachusetts. This
     Agreement is and shall be binding on the respective legal representatives
     or successors of the parties, but shall not be assignable except to a
     successor to the Company by virtue of a merger, consolidation or
     acquisition of all or substantially all of the assets of the Company. All
     previous employment contracts between the Employee and the Company or any
     of the Company's present or former subsidiaries or affiliates is hereby
     canceled and of no effect.

     IN WITNESS WHEREOF, the Company has caused its seal to be hereunto affixed
and these presents to be signed by its proper officers, and the Employee has
hereunto set his hand and seal the day and year first above written.

(SEAL)                          EG&G, INC.


                                By: /s/ Murray Gross
                                    -----------------------------------------
                                    Murray Gross    
                                    Senior Vice President & General Counsel


                                Employee: /s/ Gregory L. Summe
                                          -----------------------------------



                                       6



<PAGE>   1
                                                                 Exhibit 10.5(b)

                              EMPLOYMENT AGREEMENT
                              --------------------

     This Agreement made as of the 10th day of November, 1999, between
PerkinElmer, Inc., a Massachusetts corporation (hereinafter called
the "Company"), and Angelo D. Castellana (hereinafter referred to as the 
"Employee").


                                   WITNESSETH:
                                   -----------

     WHEREAS, the Employee is being employed in a management position with the
Company; and

     WHEREAS, the Employee hereby agrees to continue to perform such services
and duties of a management nature as shall be assigned to him; and

     WHEREAS, the Employee hereby agrees to the compensation herein provided and
agrees to serve the Company to the best of his ability during the period of this
Agreement.

     NOW, THEREFORE, in consideration of the sum of One Dollar, and of the
mutual covenants herein contained, the parties agree as follows:

1.   a)   Except as hereinafter otherwise provided, the Company agrees to employ
          the employee in a management position with the Company, and the
          Employee agrees to remain in the employment of the Company in that
          capacity for a period of one year from the date hereof and from year
          to year thereafter until such time as this Agreement is terminated.

     b)   The Company will, during each year of the term of this Agreement,
          place in nomination before
 the Board of Directors of the Company the
          name of the Employee for election as an Officer of the Company except
          when a notice of termination has been given in accordance with
          Paragraph 5(b).

2.   The Employee agrees that, during the specified period of employment, he
     shall, to the best of his ability, perform his duties, and shall devote his
     full business time, best efforts, business judgment, skill and knowledge to
     the advancement of the Company and its interests and to the discharge of
     his duties and responsibilities hereunder. The Employee shall not engage in
     any business, profession or occupation which would conflict with the
     rendition of the agreed-upon services, either directly or indirectly,
     without the prior approval of the Board of Directors, except for personal
     investment, charitable and philanthropic activities.



                                        1
                              Employment Agreement


<PAGE>   2


3.   During the period of his employment under this Agreement, the Employee
     shall be compensated for his services as follows:

     a)   Except as otherwise provided in this Agreement, he shall be paid a
          salary during the period of this Agreement at a base rate to be
          determined by the Company on an annual basis. Except as provided in
          Subparagraph 3d, such annual base salary shall under no circumstances
          be fixed at a rate below the annual base rate then currently in
          effect;

     b)   He shall be reimbursed for any and all monies expended by him in
          connection with his employment for reasonable and necessary expenses
          on behalf of the Company in accordance with the policies of the
          Company then in effect;

     c)   He shall be eligible to participate under any and all bonus, benefit,
          pension, compensation, and option plans which are, in accordance with
          company policy, available to persons in his position (within the
          limitation as stipulated by such plans). Such eligibility shall not
          automatically entitle him to participate in any such plan;

     d)   If, because of adverse business conditions or for other reasons, the
          Company at any time puts into effect salary reductions applicable at a
          single rate to management employees of the Company generally, the
          salary payments required to be made under this Agreement to the
          Employee during any period in which such general reduction is in
          effect may be reduced by the same percentage as is applicable to all
          management employees of the Company generally. Any benefits made
          available to the Employee which are related to base salary shall also
          be reduced in accordance with any salary reduction.

4. 

     a)   So long as the Employee is employed by the Company and for a period of
          one year after the termination of expiration of employment, the
          Employee will not directly or indirectly: (i) as an individual
          proprietor, partner, stockholder, officer, employee, director, joint
          venturer, investor, lender, or in any other capacity whatsoever (other
          than as the holder of not more than one percent (1%) of the total
          outstanding stock of a publicly held company), engage directly or
          indirectly in any business or entity, which competes with the business
          conducted by the Company or its affiliates in any city or geographic
          area in which the Company or its affiliates conduct material
          operations at the time of termination of employment under this
          Agreement, except as approved in advance by the Board after full and
          adequate disclosure; or (ii) recruit, solicit or induct, or attempt to
          induce, any


                                        2
                              Employment Agreement


<PAGE>   3


          employee or employees of the Company to terminate their employment
          with, to otherwise cease their relationship with, the Company; or
          (iii) solicit, divert or take away, or attempt to divert or to take
          away, the business or patronage of any of the clients, customers or
          accounts, of the Company that were contacted, solicited or served by
          the Employee while employed by the Company.

     b)   If any restriction set forth in this Section 4 is found by any court
          of competent jurisdiction to be unenforceable because it extends for
          too long a period of time or over too great a range of activities or
          in too broad a geographical areas it shall be interpreted to extend
          only over the maximum period of time, range of activities or
          geographic area as to which it may be enforceable.

     c)   The restrictions contained in this Section 4 are necessary for the
          protection of the business and goodwill of the Company and are
          considered by the Employee to be reasonable for such purpose. The
          Employee agrees that any breach of this Section 4 will cause the
          Company substantial and irrevocable damage and therefore, in the event
          of any such breach, in addition to such other remedies which may be
          available, the Company shall have the right to seek specific
          performance and injunctive relief.

     d)   The Employee agrees to sign and be bound by the Employee Patent and
          Proprietary Information Utilization Agreement in the form attached
          hereto.

     e)   During the period of his employment by the Company or for any period
          during which the Company shall continue to pay the Employee his salary
          under this Agreement, whichever shall be longer, the Employee shall
          not in any way whatsoever aid or assist any party seeking to cause,
          initiate or effect a Change in Control of the Company as defined in
          Paragraph 6 without the prior approval of the Board of Directors.

5.   Except for the Employee covenants set forth in Paragraph 4 which covenants
     shall remain in effect for the periods stated therein, and subject to
     Paragraph 6, this Agreement shall terminate upon the happening of any of
     the following events and (except as provided herein) all of the Company's
     obligations under this Agreement, including, but not limited to, making
     payments to the Employee shall cease and terminate:

     a)   On the effective date set forth in any resignation submitted by the
          Employee and accepted by the Company, or if no effective date is
          agreed upon, the date of receipt of such resignation letter;

     b)   One year after written notice of termination is given by the Company
          to the



                                        3
                              Employment Agreement


<PAGE>   4


          Employee;

     c)   At the death of the Employee;

     d)   At the termination of the Employee for cause. As used in the
          Agreement, the term "cause" shall mean:

          i)   Misappropriating any funds or property of the Company;

          ii)  Unreasonable refusal to perform the duties assigned to him under
               this Agreement;

          iii) Conviction of a felony;

          iv)  Continuous conduct bringing notoriety to the Company and having
               an adverse effect on the name or public image of the Company;

          v)   Violation of the Employee's covenants as set forth in Paragraph 4
               above; or

          vi)  Continued failure by the Employee to observe any of the
               provisions of this Agreement after being informed of such breach.

     e)   Twelve months after written notice of termination (a "Disability
          Termination Notice") is given by the Company to the Employee based on
          a determination by the Board of Directors that the Employee is
          disabled (which, for purposes of this Agreement, shall mean that the
          Employee is unable to perform his regular duties, with such
          determination to be made by the Board of Directors, in reliance upon
          the opinion of the Employee's physician or upon the opinion of one or
          more physicians selected by the Company). A Disability Termination
          Notice shall be deemed properly delivered if given by the Company to
          the Employee on the 184th day of continuous disability of the
          Employee. Notwithstanding the foregoing, if, during the twelve-month
          period following proper delivery of a Disability Termination Notice as
          aforesaid, the Employee is no longer disabled and is able to return to
          work, such Disability Termination Notice shall be deemed automatically
          rescinded upon the Employee's return to work, and the employment of
          the Employee shall continue in accordance with the terms of this
          Agreement. During the first 184 days of continuous disability of the
          Employee, the Company will make periodic payments to the Employee in
          an amount equal to the difference between his base salary and the
          benefits received by the Employee under the Company's Short-Term
          Disability Income Plan. During the twelve-month period following
          proper delivery of a Disability Termination Notice as aforesaid, the
          Company will make periodic



                                        4
                              Employment Agreement



<PAGE>   5


          payments to the Employee in an amount equal to the difference between
          his base salary and the benefits provided by the Company's Long-Term
          Disability Plan. If any payments to the Employee under the Company's
          Long-Term Disability Plan are not subject to federal income taxes, the
          payments to be made directly by the Company pursuant to the preceding
          sentence shall be reduced such that the total amount received by the
          Employee (from the Company and from the Long-Term Disability Plan),
          after payment of any income taxes, is equal to the amount that the
          Employee would have received had he been paid his base salary, after
          payment of any income taxes on such base salary.

     f)   In the event of the termination of the Employee by the Company
          pursuant to paragraph 5(b) above, the Employee shall, for a period of
          one year from the date this agreement shall terminate, (i) continue to
          receive his Full Salary (as defined below), which shall be payable in
          accordance with the payment schedule in effect immediately prior to
          his employment termination, and (ii) continue to be entitled to
          participate in all employee benefit plans and arrangements of the
          Company (such as life, health and disability insurance and automobile
          arrangements) to the same extent (including coverage of dependents, if
          any) and upon the same terms as were in effect immediately prior to
          his termination. For purposes of this Agreement, "Full Salary" shall
          mean the Employee's annual base salary, plus the amount of any bonus
          or incentive payments received by the Employee with respect to the
          last full fiscal year of the Company for which all bonus or incentive
          payments to be made have been made.

     g)   In the event of a termination of employment pursuant to paragraph
          5(a), (c) or (d), the Company shall pay the Employee his full salary
          through the date of termination of employment.

6.   a)   In the event of a Change in Control of the Company (as defined below),
          the provisions of this Agreement shall be amended as follows:

          i)   Paragraph 1a shall be amended to read in its entirety as follows:

               "Except as hereinafter otherwise provided, the Company agrees to
               continue to employ the Employee in a management position with the
               Company, and the Employee agrees to remain in the employment in
               the Company in that capacity, for a period of three (3) years
               from the date of the Change in Control. Except as provided in
               Paragraph 3d, the Employee's salary as set forth in Paragraph 3a
               and his other employee benefits pursuant to the plans described
               in Paragraph 3c shall not be decreased during such period."



     
                                        5
                              Employment Agreement


<PAGE>   6


          ii)  Paragraph 5a shall be amended by the addition of the following
               provision at the end of such paragraph:

               "provided that the Employee agrees not to resign, except for Good
               Reason (as defined below), during the one-year period following
               the date of the Change in Control."

          iii) Paragraph 5b shall be deleted in its entirety.

          iv)  Paragraph 5f shall be amended to read in its entirety as follows:

               "Notwithstanding the foregoing provisions, if, within 36 months
               following the occurrence of a Change in Control, the Employee's
               employment by the Company is terminated (A) by the Company other
               than for Cause, which shall not include any failure to perform
               his dudes hereunder after giving notice or termination for Good
               Reason, disability or death or (B) by the Employee for Good
               Reason, (1) the Company shall pay to the Employee, on the date of
               his employment termination, a lump sum cash payment in an amount
               equal to the sum of (x) his unpaid base salary through the date
               of termination, (y) pro rata portion of prior year's bonus and
               (z) his Full Salary (as defined below) multiplied by three and
               (2) the Employee shall for 36 months following the occurrence of
               the Change in Control be eligible to participate in all employee
               benefit plans and arrangements of the Company (such as life,
               health and disability insurance and automobile arrangements but
               excluding incentive arrangements and grants of stock options) to
               the same extent (including coverage of dependents, if any) and
               upon the same terms as were in effect immediately prior to his
               termination. For purposes of this Agreement, "Full Salary" shall
               mean the Employee's annual base salary, plus the amount of any
               bonus or incentive payments received by the Employee with respect
               to the last full fiscal year of the Company for which all bonus
               or incentive payments to be made have been made. Payments under
               this Paragraph 5f shall be made without regard to whether the
               deductibility of such payments (or any other "parachute
               payments," as that term is defined in Section 280G of the
               Internal Revenue Code of 1986, as amended (the "Code"), to or for
               the benefit of the Employee) would be limited or precluded by
               Section 280G and without regard to whether such payments (or any
               other "parachute payments" as so defined in said Section 280G)
               would subject the Employee to the federal excise tax levied on
               certain "excess parachute payments" under Section 4999 of the
               Code (the "Excise Tax"). In addition, the Employee shall be
               entitled to receive a payment (the "Gross-Up Payment") which
               shall be an amount equal to the sum of (a) the Excise Tax imposed
               on any parachute payment, whether or not



                                        6
                              Employment Agreement


<PAGE>   7


               payable under this Agreement, and (b) the amount necessary to pay
               all additional taxes imposed on (or economically borne by) the
               Employee (including the Excise Tax, state and federal income
               taxes and all applicable withholding taxes) attributable to the
               receipt of the Gross-Up Payment, computed assuming the
               application of the maximum tax rates provided by law. The
               determination of the Gross-Up Payment shall be made at the
               Company's expense by Arthur Andersen & Co. or by such other
               certified public accounting firm as the Board of Directors of the
               Company may designate prior to a Change in Control of the
               Company. In the event of any underpayment or overpayment under
               this Paragraph 5f as determined by Arthur Andersen & Co. (or such
               other firm as may have been designated in accordance with the
               preceding sentence), the amount of such underpayment or
               overpayment shall forthwith be paid to the Employee or refunded
               to the Company, as the case may be, with interest at the
               applicable federal rate provided for in Section 7872(f)(2) of the
               Code."

          v)   Paragraph 8 shall be amended to read in its entirety as follows:

               "The Employee may pursue any lawful remedy he deems necessary or
               appropriate for enforcing his rights under this Agreement
               following a Change in Control of the Company, and all costs
               incurred by the Employee in connection therewith (including
               without limitation attorneys' fees) shall be promptly reimbursed
               to him by the Company, regardless of the outcome of such
               endeavor."

     b)   For purposes of this Agreement, a "Change in Control of the Company"
          means an event or occurrence set forth in any one or more of clauses
          (i) through (iv) below (including an event or occurrence that
          constitutes a Change in Control under one or such clauses but is
          specifically exempted from another such clause):

                       (i) the acquisition by an individual, entity or group
          (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
          Exchange Act of 1934, as amended (the "Exchange Act") (a "Person") of
          beneficial ownership of any capital stock or the Company if, after
          such acquisition, such Person beneficially owns (within the meaning of
          Rule 13d-3 promulgated under the Exchange Act) 20% or more of either
          (1) the then-outstanding shares of common stock of the Company (the
          "Outstanding Company Common Stock") or (2) the combined voting power
          of the then-outstanding securities of the Company entitled to vote
          generally in the election of directors (the "Outstanding Company
          Voting Securities"); provided, however, that for purposes of this
          paragraph (i), the following acquisitions shall not constitute a
          Change in Control: (l) any acquisition directly from the Company



                                        7
                              Employment Agreement


<PAGE>   8


          (excluding an acquisition pursuant to the exercise, conversion or
          exchange of any security exercisable for, convertible into or
          exchangeable for common stock or voting securities of the Company,
          unless the Person exercising, converting or exchanging such security
          acquired such security directly from the Company or an underwriter or
          agent of the Company), (2) any acquisition by the Company, (3) any
          acquisition by any employee benefit plan (or related trust) sponsored
          or maintained by the Company or any corporation controlled by the
          Company, or (4) any acquisition by any corporation pursuant to a
          transaction which complies with subclauses (1) and (2) or clause (iii)
          of this Section 6b; or

                         (ii) such time as the Continuing Directors (as defined
          below) do not constitute a majority of the Board (or, if applicable,
          the Board of Directors of a successor corporation to the Company),
          where the term "Continuing Director" means at any date a member of the
          Board (1) who was a member of the Board on the date of the execution
          of this Agreement or (2) who was nominated or elected subsequent to
          such date by at least a majority of the directors who were Continuing
          Directors at the time of such nomination or election or whose election
          to the Board was recommended or endorsed by at least a majority of the
          directors who were Continuing Directors at the time of such nomination
          or election; provided, however, that there shall be excluded from this
          clause (2) any individual whose initial assumption of office occurred
          as a result of an actual or threatened election contest with respect
          to the election or removal of directors or other actual or threatened
          solicitation of proxies or consents, by or on behalf of a person other
          than the Board; or

                         (iii) the consummation of a merger, consolidation,
          reorganization, recapitalization or statutory share exchange involving
          the Company or a sale or other disposition of all or substantially all
          of the assets of the Company (a "Business Combination"), unless,
          immediately following such Business Combination, each of the following
          two conditions is satisfied: (1) all or substantially all of the
          individuals and entities who were the beneficial owners of the
          Outstanding Company Common Stock and Outstanding Company Voting
          Securities immediately prior to such Business Combination beneficially
          own, directly or indirectly, more than 50% of the then-outstanding
          shares of common stock and the combined voting power of the
          then-outstanding securities entitled to vote generally in the election
          of directors, respectively, of the resulting or acquiring corporation
          in such Business Combination (which shall include, without limitation,
          a corporation which as a result of such transaction owns the Company
          or substantially all of the Company's assets either directly or
          through one or more subsidiaries) (such resulting or acquiring
          corporation is referred to herein as the "Acquiring Corporation") in
          substantially the same proportions as their ownership, immediately
          prior to such


                                       8
                              Employment Agreement



<PAGE>   9


          Business Combination, of the Outstanding Company Stock and Outstanding
          Company Voting Securities, respectively; and (2) no Person (excluding
          the Acquiring Corporation or any employee benefit plan (or related
          trust) maintained or sponsored by the Company or by the Acquiring
          Corporation) beneficially owns, directly or indirectly, 20% or more of
          the then outstanding shares of common stock of the Acquiring
          Corporation, or of the combined voting power of the then-outstanding
          securities of such corporation entitled to vote generally in the
          election of directors (except to the extent that such ownership
          existed prior to the Business Combination); or

                         (iv) approval by the stockholders of the Company or a
          complete liquidation or dissolution of the Company.

     c)   For purposes of this Agreement, "Good Reason" shall mean the
          occurrence of any of the following events: (i) a reduction in the
          Employee's base salary as in effect on the date hereof or as the same
          may be increased from time to time, except as provided in Paragraph
          3d; (ii) a failure by the Company to pay annual cash bonuses to the
          Employees in an amount at least equal to the most recent annual cash
          bonuses paid to the Employee; (iii) a failure by the Company to
          maintain in effect any material compensation or benefit plan in which
          the Employee participated immediately prior to the Change in Control,
          unless an equitable arrangement has been made with respect to such
          plan, or a failure to continue the Employee's participation therein on
          a basis not materially less favorable than existed immediately prior
          to the Change in Control; (iv) any significant and substantial
          diminution in the Employee's position, duties, authorities,
          responsibilities or title as in effect immediately prior to the Change
          in Control; (v) any requirement by the Company that the location at
          which the Employee performs his principal duties be changed to a new
          location outside a radius of 25 miles from the Employee's principal
          place of employment immediately prior to the Change in Control; (vi)
          any requirement by the Company that the Employee travel on an
          overnight basis to an extent not substantially consistent with the
          Employee's business travel obligations immediately prior to the Change
          in Control or (vii) the failure of the Company to obtain the
          agreement, in a form reasonably satisfactory to the Employee, from any
          successor to the Company to assume and agree to perform this
          Agreement. Notwithstanding the foregoing, the resignation shall not be
          considered to be for Good Reason if any such circumstances are fully
          corrected prior to the date of resignation. The Employee's right to
          terminate his employment for Good Reason shall not be affected by his
          incapacity due to physical or mental illness.

7.   Neither the Employee nor, in the event of his death, his legal
     representative, beneficiary or estate, shall have the power to transfer,
     assign, mortgage or otherwise encumber in advance



                                        9
                              Employment Agreement



<PAGE>   10


     any of the payments provided for in this Agreement, nor shall any payments
     nor assets or funds of the Company be subject to seizure for the payment of
     any debts, judgments, liabilities, bankruptcy or other actions.

8.   Any controversy relating to this Agreement and not resolved by the Board of
     Directors and the Employee shall be settled by arbitration in the City of
     Boston, Commonwealth of Massachusetts, pursuant to the rules then obtaining
     of the American Arbitration Association, and judgment upon the award may be
     entered in any court having jurisdiction, and the Board of Directors and
     Employee agree to be bound by the arbitration decision on any such
     controversy. Unless otherwise agreed by the parties hereto, arbitration
     will be by three arbitrators selected from the panel of the American
     Arbitration Association. The full cost of any such arbitration shall be
     borne by the Company.

9.   Failure to insist upon strict compliance with any of the terms, covenants,
     or conditions hereof shall not be deemed a waiver of such term, covenant,
     or condition, nor shall any waiver or relinquishment of any right or power
     hereunder at any one or more times be deemed a waiver or relinquishment of
     such right or power at any other time or times by either party.

10.  All notices or other communications hereunder shall be in writing and shall
     be deemed to have been duly given when delivered personally to the Employee
     or to the General Counsel of the Company or when mailed by registered or
     certified mail to the other party (if to the Company, at 45 William Street,
     Wellesley, Massachusetts 02481, attention General Counsel; if to the
     Employee, at the last known address of the Employee as set forth in the
     records of the Company).

11.  This Agreement has been executed and delivered and shall be construed in
     accordance with the laws of the Commonwealth of Massachusetts. This
     Agreement is and shall be binding on the respective legal representatives
     or successors of the parties, but shall not be assignable except to a
     successor to the Company by virtue of a merger, consolidation or
     acquisition of all or substantially all of the assets of the Company. This
     Agreement constitutes and embodies the entire understanding and agreement
     of the parties and, except as otherwise provided herein, there are no
     other agreements or understandings, written or oral, in effect between the
     parties hereto relating to the employment of the Employee by the Company.
     All previous employment contracts between the Employee and the Company or
     any of the Company's present or former subsidiaries or affiliates is hereby
     canceled and of no effect.

12.  The Company shall require any successor (whether direct or indirect, by
     purchase, merger, consolidation or otherwise) to all or substantially all
     of the business or assets of the Company to assume expressly in writing and
     to agree to perform its obligations under this



                                       10
                              Employment Agreement


<PAGE>   11


     Agreement in the same manner and to the same extent that the Company would
     be required to perform it if no such succession had taken place. Failure of
     the Company to obtain an assumption of this Agreement prior to the
     effectiveness of succession shall be a breach of this Agreement. As used in
     this Agreement, "the Company" shall mean the Company as defined above and
     any successor to its business or assets as aforesaid which assumes and
     agrees to perform this Agreement by operation of law, or otherwise.





                                       11
                              Employment Agreement



<PAGE>   12


     IN WITNESS WHEREOF, the Company has caused its seal to be hereunto affixed
and these presents to be signed by its proper officers, and the Employee has
hereunto set his hand and seal the day and year first above written.


(SEAL)                                  PERKINELMER, INC.



                                        By: /s/ Gregory L. Summe
                                            -----------------------------------
                                            Gregory L. Summe
                                            Chairman and Chief Executive Officer



                                        Employee: /s/ Angelo D. Castellana
                                                  -----------------------------
                                                  Angelo D. Castellana




                                       12
                              Employment Agreement





<PAGE>   1
                                                                    Exhibit 10.9

                          AGREEMENT AND GENERAL RELEASE

                  EG&G, Inc., 45 William Street, Wellesley, Massachusetts,
02481, its affiliates, subsidiaries, divisions, successors and assigns and the
employees, officers, directors and agents thereof (collectively referred to
throughout this Agreement as "EG&G"), and Murray Gross ("Gross") agree that:

                  1. DATE OF CESSATION OF EMPLOYMENT Upon execution of this
Agreement, Gross will submit a letter to EG&G resigning as Senior Vice
President, General Counsel and Clerk effective May 14, 1999 and terminating his
employment and his Employment Agreement dated November 1, 1993 effective July 2,
1999.

                  2. CONSIDERATION. In consideration for signing this Agreement
and General Release and compliance with the promises made herein, EG&G agrees:

                           a.       to pay to Gross one lump sum in the amount
of Five Hundred Twenty Thousand dollars ($520,000) less lawful deductions, and
appropriate withholdings provided that EG&G has received the letter from Gross
in the form attached hereto as Exhibit "A" by May 7, 1999 and provided that
Gross did not revoke this Agreement pursuant to paragraph 4, said payment shall
be deemed to be salary and a management incentive bonus payment attributable to
work performed in 1999;

                           b.       to pay Gross his Target EVA incentive
payment at a 50% rate for 1999 less lawful deductions, said payment to be made
at the time such EVA payments are made to other officers; provided, however that
if EG&G's performance is below the target level, the incentive payment will be
reduced in accordance with the provisions of the EVA incentive plan. 

                           c. to allow Gross to receive the Company car then
currently assigned to him without charge, all taxes related thereto shall be
paid by Gross;

                           d.       to allow Gross to keep the computer and
related peripherals currently being used by him;

                           e.       to continue until May 14, 2000 or until
Gross becomes eligible for other comparable coverage whichever comes first,
Gross' same medical and dental coverage (but not disability coverage which will
terminate on May 14, 1999) as was in effect immediately prior to May 14, 1999,
the cost of said coverage to be borne by the Company;

                           f.       that, for all purposes hereunder including
but not limited to the calculation of payments due under the EG&G, Inc.
Supplemental Executive Retirement Plan, Gross shall be deemed to have been an
officer of EG&G, Inc. from April 24, 1990 through May 14, 1999; and

                           g.       to pay the Company match in the EG&G Savings
Plan for the 1999 Plan year.

<PAGE>   2
                           3.       NO  CONSIDERATION  ABSENT  EXECUTION  OF
THIS AGREEMENT. GROSS understands and acknowledges that he will not receive and
will not be entitled to any of the items "a-g" above until ten (10) business
days after the Company received from Gross the letter in the form attached
hereto as Exhibit A. Gross also understands and acknowledges that he is
responsible for the payment of all federal, state and payroll taxes associated
with items "a-g" above.

                  4. REVOCATION. Gross may revoke this Agreement and General
Release for a period of seven (7) days following the day he executes this
Agreement and General Release. Any revocation within this period must be
submitted, in writing, to Richard Walsh, Senior Vice President, and state, "I
hereby revoke my acceptance of our Agreement and General Release." The
revocation must be personally delivered to Mr. Walsh or his designee, or mailed
to Mr. Walsh at EG&G, 45 William Street, Wellesley, Massachusetts 02481 and
postmarked within seven (7) days of execution of this Agreement and General
Release. This Agreement and General Release shall not become effective or
enforceable until the revocation period has expired. If the last day of the
revocation period is a Saturday, Sunday, or legal holiday in Massachusetts, then
the revocation period shall not expire until the next following day which is not
a Saturday, Sunday, or legal holiday.

                  5. GENERAL RELEASE OF CLAIMS. GROSS KNOWINGLY AND VOLUNTARILY
RELEASES AND FOREVER DISCHARGES EG&G, OF AND FROM ANY AND AIL CLAIMS, KNOWN AND
UNKNOWN, WHICH AGAINST EG&G, GROSS, HIS heirs, executors, administrators,
successors, and ASSIGNS (referred to collectively throughout this Agreement as
"Gross") have or may HAVE AS OF THE DATE OF EXECUTION OF THIS AGREEMENT AND
GENERAL RELEASE, INCLUDING, BUT NOT LIMITED TO, any alleged violation of:

         -        The National Labor Relations Act, as amended;

         -        Title VII of the Civil Rights Act of 1964, as amended;

         -        The Civil Rights Act of 1991

         -        Sections 1981 through 1988 of Title 42 of the United States
                  Code, as amended;

         -        the Employee Retirement Income Security Act of 1974, as
                  amended;

         -        The Immigration Reform Control Act, as amended;

         -        The Americans with Disabilities Act of 1990, as amended

         -        The Age Discrimination in Employment Act of 1967, as amended;

                                      -2-

<PAGE>   3
         -        The Fair Labor
 Standards Act, as amended;

         -        The Occupational Safety and Health Act, as amended;

         -        The Family and Medical Leave Act of 1993;

         -        The Massachusetts Law Against Discrimination, G.L., c. 151B;

         -        The Massachusetts Civil Rights Act, G.L. c. 12,
                  Sections llH and 11I;

         -        The Massachusetts Equal Rights Law, G.L. c. 93;

         -        The Massachusetts Wage and Hour Laws, G.L. c.s 149 and 151;

         -        The Massachusetts Privacy Statute, G.L. c. 214,Section 1B, as
                  amended;

         -        any other federal, state or local civil or human rights law or
                  any other local, state or federal law, regulation or
                  ordinance;

         -        any public policy, contract, tort, or common law; or

         -        any allegation for costs, fees, or other expenses including
                  attorneys' fees incurred in these matters.

                  6. NO CLAIMS EXIST. Gross confirms that no charge, complaint,
or action exists in any forum or form. In the event that any such claim, charge,
complaint or action is filed, Gross shall not be entitled to recover any relief
or recovery therefrom, including costs and attorney's fees. Gross acknowledges
that he understands that if this Agreement were not signed, Gross would have the
right to voluntarily assist other individuals or entities in bringing claims
against EG&G. Gross hereby waives that right and he will not provide any such
assistance other than assistance in an investigation or proceeding conducted by
the United States Equal Employment Opportunity Commission. EG&G and Gross
further agree that Gross may provide information pursuant to any valid subpoena.

                  7. Confidentiality. Gross agrees not to disclose or cause to
be disclosed any information regarding the existence or substance of this
Agreement and General Release, other than to an attorney with whom Gross chooses
to consult regarding his consideration of this Agreement and General Release,
his immediate family, tax advisors or as required by law. Gross agrees to
instruct all of his representatives, including, without limitation, his
attorney, immediate family and tax advisors, if applicable, not to disclose or
cause to be disclosed any information regarding the existence or substance of
this Agreement and General Release, except as required by law.

                                      -3-

<PAGE>   4
                  8. GOVERNING LAW AND INTERPRETATION. This Agreement and
General Release shall be governed and conformed in accordance with the laws of
the Commonwealth of Massachusetts without regard to its conflict of laws
provision. Should any provision of this Agreement and General Release be
declared illegal or unenforceable by any court of competent jurisdiction and
cannot be modified to be enforceable, excluding the general release language,
such provision shall immediately become null and void, leaving the remainder of
this Agreement and General Release in full force and effect. However, if any
portion of the general release language were ruled to be unenforceable for any
proceeding initiated by Gross, Gross shall return the consideration paid
hereunder to EG&G.

                  9. NONADMISSION OF WRONGDOING. Gross agrees that neither this
Agreement and General Release nor the furnishing of the consideration for this
Release shall be deemed or construed at anytime for any purpose as an admission
by EG&G of any liability or unlawful conduct of any kind.

                  10. AMENDMENT. This Agreement and General Release may not be
modified, altered or changed except upon express written consent of both Parties
wherein specific reference is made to this Agreement and General Release.

                  11. ENTIRE AGREEMENT. This Agreement and General Release sets
forth the entire agreement between the parties hereto, and fully supersedes any
prior agreements between the parties, except Gross agrees to abide by the
agreement contained in paragraph 4(b) of the Employment Agreement between Gross
and EG&G made as of November 1, 1993. Gross acknowledges that he has not relied
on any representations, promises, or agreements of any kind made to him in
connection with his decision to sign this Agreement and General Release, except
for those set forth in this Agreement and General Release.

                                      -4-

<PAGE>   5
                  GROSS HAS BEEN ADVISED THAT HE HAS AT LEAST TWENTY-ONE (21)
DAYS TO CONSIDER THIS AGREEMENT AND GENERAL RELEASE AND HAS BEEN ADVISED IN
WRITING TO CONSULT WITH AN ATTORNEY PRIOR TO EXECUTION OF THIS AGREEMENT AND
GENERAL RELEASE.

                  GROSS AGREES THAT ANY MODIFICATIONS, MATERIAL OR OTHERWISE,
MADE TO THIS AGREEMENT AND GENERAL RELEASE DO NOT RESTART OR AFFECT IN ANY
MANNER THE ORIGINAL TWENTY-ONE DAY CONSIDERATION PERIOD.

                  HAVING ELECTED TO EXECUTE THIS AGREEMENT AND GENERAL RELEASE,
TO FULFILL THE PROMISES SET FORTH HEREIN, AND TO RECEIVE THEREBY THE SUMS AND
BENEFITS SET FORTH IN PARAGRAPH "2" ABOVE, GROSS FREELY AN]) KNOWINGLY, AND
AFTER DUE CONSIDERATION, ENTERS INTO THIS AGREEMENT AND GENERAL RELEASE
INTENDING TO WAIVE, SETTLE AND RELEASE ALL CLAIMS HE HAS OR MIGHT HAVE AGAINST
EG&G.

                  IN WITNESS WHEREOF, the parties hereto knowingly and
voluntarily executed this Agreement and General Release as of the date set forth
below:


                               /s/ Murray Gross
                               -----------------------------------------------
                                   Murray Gross

                               Date:   April 30, 1999
                                    ------------------------------------------

                               EG&G, Inc.

                               By: /s/ Richard F. Walsh
                                  --------------------------------------------
                                       Richard F. Walsh

                               Title:   Senior Vice President, Human Resources
                                     -----------------------------------------

                               Date: April 30, 1999
                                    ------------------------------------------

                                      -5-



<PAGE>   1
                                                                   EXHIBIT 10.10

                          AGREEMENT AND GENERAL RELEASE

         EG&G, Inc., 45 William Street, Wellesley, Massachusetts, 02181, its
affiliates, subsidiaries, divisions, successors and assigns and the employees,
officers, directors and agents thereof (collectively referred to throughout this
Agreement as "EG&G"), and Daniel T. Heaney ("Heaney") agree that:

         1. DATE OF CESSATION OF EMPLOYMENT. Heaney may at his election submit a
letter to EG&G terminating his employment and his Employment Agreement dated
June 1, 1995 effective December 31, 1999 or such earlier date after December 31,
1998 as may be determined by Heaney.

         2. CONSIDERATION. In consideration for signing this Agreement and
General Release and compliance with the promises made herein, EG&G agrees:

                  a. to pay to Heaney one lump sum in the amount Three Hundred
Thirty Four Thousand Dollars ($334,000) less lawful deductions, and appropriate
withholdings provided that EG&G has received a letter from Heaney in the form
attached hereto as Exhibit "A" at least twenty-one (21) days prior to the
receipt of the consideration to be paid by EG&G hereunder and provided that
Heaney did not revoke this Agreement pursuant to paragraph 4, said payment shall
be deemed to be salary and a management incentive bonus payment attributable to
work performed in the calendar year paid;

                  b. to pay Heaney his full EVA incentive payment for 1998 less
lawful deductions said payment to be made at the time such EVA payments are made
to other officers;

                  c. to allow Heaney to keep the laptop computer currently being
used by him;

                  d. to pay a lump sum of $10,000 to be used for out placement
services, training, job search related costs or relocation, said payment will be
subject to appropriate tax withholdings;

                  e. to continue until December 31, 1999 or until Heaney becomes
eligible for other comparable coverage whichever comes first, Heaney' same
medical and dental coverage as was in effect immediately prior to December 31,
1998, the cost of said coverage to be borne by the Company;

                  f. to pay the Company match in the EG&G Savings Plan for the
1998 Plan

<PAGE>   2
                  g. all Employee Stock Options granted by EG&G to Heaney shall
be deemed to have been vested as of December 31, 1998. Said options shall be
exercisable until the earlier of the expiration dates specified in such options
or two years following the date of resignation specified in the letter of
resignation.

          3. NO CONSIDERATION ABSENT EXECUTION OF THIS AGREEMENT. Heaney
understands and acknowledges that he will not receive and will not be entitled
to any of the items "a-f" above until ten (10) business days after the Company
received from Heaney the letter in the form attached hereto as Exhibit A. Heaney
also understands and acknowledges that he is responsible for the payment of all
federal, state and payroll taxes associated with items "a-f" above.

         4. REVOCATION. Heaney may revoke this Agreement and General Release for
a period of seven (7) days following the day he executes this Agreement and
General Release. Any revocation within this period must be submitted, in
writing, to Murray Gross, Senior Vice President and General Counsel, and state,
"I hereby revoke my acceptance of our Agreement and General Release." The
revocation must be personally delivered to Mr. Gross or his designee, or mailed
to Mr. Gross at EG&G, 45 William Street, Wellesley, Massachusetts 02181 and
postmarked within seven (7) days of execution of this Agreement and General
Release. This Agreement and General Release shall not become effective or
enforceable until the revocation period has expired. If the last day of the
revocation period is a Saturday, Sunday, or legal holiday in Massachusetts, then
the revocation period shall not expire until the next following day which is not
a Saturday, Sunday, or legal holiday.

         5. GENERAL RELEASE OF CLAIMS. Heaney knowingly and voluntarily releases
and forever discharges EG&G, of and from any and all claims, known and unknown,
which against EG&G, Heaney, his heirs, executors, administrators, successors,
and assigns (referred to collectively throughout this Agreement as "Heaney")
have or may have as to the date of execution of this Agreement and General
Release, including, but not limited to, any alleged violation of:

          -        The National Labor Relations Act, as amended;

          -        Title VII of the Civil Rights Act of 1964, as amended;

          -        The Civil Rights Act of 1991

          -        Sections 1981 through 1988 of Title 42 of the United States
                   Code, as amended;

                                       2

<PAGE>   3
          -        the Employee Retirement Income Security Act of 1974, as
                   amended;

          -        The Immigration Reform Control Act, as amended;

          -        The Americans with Disabilities Act of 1990, as amended;

          -        The Age Discrimination in Employment Act of 1967, as
                   amended;

          -        The Fair Labor Standards Act, as amended;

          -        The Occupational
 Safety and Health Act, as amended;

          -        The Family and Medical Leave Act of 1993;

          -        The Massachusetts Law Against Discrimination, G.L., c. iSiB;

          -        The Massachusetts Civil Rights Act, G.L. c. 12,
                   Sections 11H and 111;

          -        The Massachusetts Equal Rights Law, G.L. c. 93;

          -        The Massachusetts Wage and Hour Laws, G.L. c.s 149 and 151;

          -        The Massachusetts Privacy Statute, G.L. c. 214, Section 1B,
                   as amended;

          -        any other federal, state or local civil or human rights law
                   or any other local, state or federal law, regulation or
                   ordinance;

          -        any public policy, contract, tort, or common law; or

          -        any allegation for costs, fees, or other expenses including
                   attorneys' fees incurred in these matters.


         6. NO CLAIMS EXIST. Heaney confirms that no charge, complaint, or
action exists in any forum or form. In the event that any such claim, charge,
complaint or action is filed, Heaney shall not be entitled to recover any relief
or recovery therefrom, including costs and attorney's fees. Heaney acknowledges
that he understands that if this Agreement were not signed, Heaney would have
the right to voluntarily assist other individuals or entities in bringing claims
against EG&G. Heaney hereby waives that right and he will not provide any such
assistance other than assistance in an investigation or proceeding conducted by
the United States Equal Employment Opportunity Commission. EG&G and Heaney
further agree that Heaney may provide information

                                       3

<PAGE>   4
pursuant to any valid subpoena.

         7. CONFIDENTIALITY. Heaney agrees not to disclose or cause to be
disclosed any information regarding the existence or substance of this Agreement
and General Release, other than to an attorney with whom Heaney chooses to
consult regarding his consideration of this Agreement and General Release, his
immediate family, tax advisors or as required by law. Heaney agrees to instruct
all of his representatives, including, without limitation, his attorney,
immediate family and tax advisors, if applicable, not to disclose or cause to be
disclosed any information regarding the existence or substance of this Agreement
and General Release, except as required by law.

          8. GOVERNING LAW AND INTERPRETATION. This Agreement and General
Release shall be governed and conformed in accordance with the laws of the
Commonwealth of Massachusetts without regard to its conflict of laws provision.
Should any provision of this Agreement and General Release be declared illegal
or unenforceable by any court of competent jurisdiction and cannot be modified
to be enforceable, excluding the general release language, such provision shall
immediately become null and void, leaving the remainder of this Agreement and
General Release in full force and effect. However, if any portion of the general
release language were ruled to be unenforceable for any proceeding initiated by
Heaney, Heaney shall return the consideration paid hereunder to EG&G.

          9. NONADMISSION OF WRONGDOING. Heaney agrees that neither this
Agreement and General Release nor the furnishing of the consideration for this
Release shall be deemed or construed at anytime for any purpose as an admission
by EG&G of any liability or unlawful conduct of any kind.

          10. AMENDMENT. This Agreement and General Release may not be modified,
altered or changed except upon express written consent of both Parties wherein
specific reference is made to this Agreement and General Release.

         11. ENTIRE AGREEMENT. This Agreement and General Release sets forth the
entire agreement between the parties hereto, and fully supersedes any prior
agreements between the parties, except .Heaney agrees to abide by the agreement
contained in paragraph 4(b) of the Employment Agreement between Heaney and EG&G
made as of November 1, 1993. Heaney acknowledges that he has not relied on any
representations, promises, or agreements of any kind made to him in connection
with his decision to sign this Agreement and General Release, except for those
set forth in this Agreement and General Release.

                                       4

<PAGE>   5
         HEANEY HAS BEEN ADVISED THAT HE HAS AT LEAST TWENTY-ONE (21) DAYS TO
CONSIDER THIS AGREEMENT AND GENERAL RELEASE AND HAS BEEN ADVISED IN WRITING TO
CONSULT WITH AN ATTORNEY PRIOR TO EXECUTION OF THIS AGREEMENT AND GENERAL
RELEASE.

          HEANEY AGREES THAT ANY MODIFICATIONS, MATERIAL OR OTHERWISE, MADE TO
THIS AGREEMENT AND GENERAL RELEASE DO NOT RESTART OR AFFECT IN ANY MANNER TILE
ORIGINAL TWENTY-ONE DAY CONSIDERATION PERIOD.

          HAVING ELECTED TO EXECUTE THIS AGREEMENT AND GENERAL
RELEASE, TO FULFILL THE PROMISES SET FORTH HEREIN, AND TO RECEIVE THEREBY THE
SUMS AND BENEFITS SET FORTH IN PARAGRAPH "2" ABOVE, HEANEY FREELY AND KNOWINGLY,
AND AFTER DUE CONSIDERATION, ENTERS INTO THIS AGREEMENT AND GENERAL RELEASE
INTENDING TO WAIVE, SETTLE AND RELEASE ALL CLAIMS HE HAS OR MIGHT HAVE AGAINST
EG&G.

         IN WITNESS WHEREOF, the parties hereto knowingly and voluntarily
executed this Agreement and General Release as of the date set forth below:

                                              /s/ Daniel T. Heaney
                                              ----------------------------------
                                                  Daniel T. Heaney

                                              Date:   11/3/98
                                                   -----------------------------

                                              EG&G, Inc.

                                              By: /s/ John M. Kucharski
                                                 -------------------------------
                                                      John M. Kucharski

                                              Date:   11/3/98
                                                   -----------------------------

                                       5



<PAGE>   1
                                                                   Exhibit 10.11

                          AGREEMENT AND GENERAL RELEASE

                  EG&G, Inc., 45 William Street, Wellesley, Massachusetts,
02181, its affiliates, subsidiaries, divisions, successors and assigns and the
employees, officers, directors and agents thereof (collectively referred to
throughout this Agreement as "EG&G"), and Deborah S. Lorenz ("Lorenz") agree 
that:

                  1. DATE OF CESSATION OF EMPLOYMENT Upon execution of this
Agreement, Lorenz will submit a letter to EG&G terminating her employment and
her Employment Agreement dated November 1, 1993 effective December 31, 1999 or
such earlier date after December 31, 1998 as may be determined by Lorenz.

                  2. CONSIDERATION. In consideration for signing this Agreement
and General Release and compliance with the promises made herein, EG&G agrees:

                           a.       to pay to Lorenz one lump sum in the amount
of Four Hundred Ten Thousand Twenty dollars ($410,020) less lawful deductions,
and appropriate withholdings provided that EG&G has received the letter from
Lorenz in the form attached hereto as Exhibit "A" by November 30, 1998 and
provided that Lorenz did not revoke this Agreement pursuant to paragraph 4, said
payment shall be deemed to be salary and a management incentive bonus payment
attributable to work performed in 1998;

                           b.       to pay Lorenz her full EVA incentive payment
for 1998 less lawful deductions said payment to be made at the time such EVA
payments are made to other officers;

                           c.       to allow Lorenz to receive the Company car
then currently assigned to her without charge, all taxes related thereto shall
be paid by Lorenz;

                           d.       to allow Lorenz to keep the laptop computer
currently being used by her;

                           e.       to pay a lump sum of $10,000 to be used for
out placement services, training, job search related costs or relocation, said
payment will be subject to appropriate tax withholdings;

                           f.       to continue until December 31, 1999 or until
Lorenz becomes eligible for other comparable coverage whichever comes first,
Lorenz' same medical and dental coverage as was in effect immediately prior to
December 31, 1998, the cost of said coverage to be borne by the Company; and

                           g.       to pay the Company match in the EG&G Savings
Plan for the

<PAGE>   2
                           h.       all Employee Stock Options granted by EG&G
to Lorenz shall be deemed to have been vested as of December 31, 1998. Said
options shall be exercisable until the earlier of the expiration dates specified
in such options or March 31, 2000.

                           3.       NO  CONSIDERATION  ABSENT  EXECUTION  OF
THIS AGREEMENT. Lorenz understands and acknowledges that she will not receive
and will not be entitled to any of the items "a-h" above until ten (10) business
days after the Company received from Lorenz the letter in the form attached
hereto as Exhibit A. Lorenz also understands and acknowledges that she is
responsible for the payment of all federal, state and payroll taxes associated
with items "a-h" above.

                  4. REVOCATION. Lorenz may revoke this Agreement and General
Release for a period of seven (7) days following the day she executes this
Agreement and General Release. Any revocation within this period must be
submitted, in writing, to Murray Gross, Senior Vice President and General
Counsel, and state, "I hereby revoke my acceptance of our Agreement and General
Release. The revocation must be personally delivered to Mr. Gross or her
designee, or mailed to Mr. Gross at EG&G, 45 William Street, Wellesley,
Massachusetts 02181 and postmarked within seven (7) days of execution of this
Agreement and General Release. This Agreement and General Release shall not
become effective or enforceable until the revocation period has expired. If the
last day of the revocation period is a Saturday, Sunday, or legal holiday in
Massachusetts, then the revocation period shall not expire until the next
following day which is not a Saturday, Sunday, or legal holiday.

                  5. GENERAL RELEASE OF CLAIMS. LORENZ KNOWINGLY AND VOLUNTARILY
RELEASES AND FOREVER DISCHARGES EG&G, OF AND FROM ANY AND ALL CLAIMS, KNOWN AND
unknown, which against EG&G, Lorenz, her heirs, executors, administrators,
successors, and assigns (referred to collectively throughout this Agreement as
"Lorenz") have or may have as OF THE date OF EXECUTION OF THIS AGREEMENT AND
GENERAL RELEASE, including, but not limited to, any alleged violation of:

          -       The National Labor Relations Act, as amended;

          -       Title VII of the Civil Rights Act of 1964, as amended;

          -       The Civil Rights Act of 1991

          -       Sections 1981 through 1988 of Title 42 of the United States
                  Code, as amended;

          -       the Employee Retirement Income Security Act of 1974, as
                  amended;

          -       The Immigration Reform Control Act, as amended;

                                       2

<PAGE>   3
          -       The Americans with Disabilities
 Act of 1990, as amended;

          -       The Age Discrimination in Employment Act of 1967, as amended;

          -       The Fair Labor Standards Act, as amended;

          -       The Occupational Safety and Health Act, as amended;

          -       The Family and Medical Leave Act of 1993;

          -       The Massachusetts Law Against Discrimination, G.L., c. ISlE;

          -       The Massachusetts Civil Rights Act, G.L. c. 12, Sections 11H
                  and 111;

          -       The Massachusetts Equal Rights Law, G.L. c. 93;

          -       The Massachusetts Wage and Hour Laws, G.L. c.s 149 and 151;

          -       The Massachusetts Privacy Statute, G.L. c. 214, Section 1B, as
                  amended;

          -       any other federal, state or local civil or human rights law or
                  any other local, state or federal law, regulation or
                  ordinance;

          -       any public policy, contract, tort, or common law; or

          -       any allegation for costs, fees, or other expenses including
                  attorneys' fees incurred in these matters.


                  6. NO CLAIMS EXIST. Lorenz confirms that no charge, complaint,
or action exists in any forum or form. In the event that any such claim, charge,
complaint or action is filed, Lorenz shall not be entitled to recover any relief
or recovery therefrom, including costs and attorney's fees. Lorenz acknowledges
that she understands that if this Agreement were not signed, Lorenz would have
the right to voluntarily assist other individuals or entities in bringing claims
against EG&G. Lorenz hereby waives that right and she will not provide any such
assistance other than assistance in an investigation or proceeding conducted by
the United States Equal Employment Opportunity Commission. EG&G and Lorenz
further agree that Lorenz may provide information pursuant to any valid
subpoena.

                  7. CONFIDENTIALITY. Lorenz agrees not to disclose or cause to
be disclosed any information regarding the existence or substance of this
Agreement and General Release, other than to an attorney with whom Lorenz
chooses to consult regarding her consideration of this Agreement and General
Release, her immediate family, tax advisors or as required by law.

                                       3

<PAGE>   4
Lorenz agrees to instruct all of her representatives, including, without
limitation, her attorney, immediate family and tax advisors, if applicable, not
to disclose or cause to be disclosed any information regarding the existence or
substance of this Agreement and General Release, except as required by law.

                  8. GOVERNING LAW AND INTERPRETATION. This Agreement and
General Release shall be governed and conformed in accordance with the laws of
the Commonwealth of Massachusetts without regard to its conflict of laws
provision. Should any provision of this Agreement and General Release be
declared illegal or unenforceable by any court of competent jurisdiction and
cannot be modified to be enforceable, excluding the general release language,
such provision shall immediately become null and void, leaving the remainder of
this Agreement and General Release in full force and effect. However, if any
portion of the general release language were ruled to be unenforceable for any
proceeding initiated by Lorenz, Lorenz shall return the consideration paid
hereunder to EG&G.

                  9. NONADMISSION OF WRONGDOING. Lorenz agrees that neither this
Agreement and General Release nor the furnishing of the consideration for this
Release shall be deemed or construed at anytime for any purpose as an admission
by EG&G of any liability or unlawful conduct of any kind.

                  10. AMENDMENT. This Agreement and General Release may not be
modified, altered or changed except upon express written consent of both Parties
wherein specific reference is made to this Agreement and General Release.

                  11. ENTIRE AGREEMENT. This Agreement and General Release sets
forth the entire agreement between the parties hereto, and fully supersedes any
prior agreements between the parties, except Lorenz agrees to abide by the
agreement contained in paragraph 4(b) of the Employment Agreement between Lorenz
and EG&G made as of November 1, 1993. Lorenz acknowledges that she has not
relied on any representations, promises, or agreements of any kind made to her
in connection with her decision to sign this Agreement and General Release,
except for those set forth in this Agreement and General Release.

                                       4

<PAGE>   5
                  LORENZ HAS BEEN ADVISED THAT SHE HAS AT LEAST TWENTY-ONE (21)
DAYS TO CONSIDER THIS AGREEMENT AND GENERAL RELEASE AND HAS BEEN ADVISED IN
WRITING TO CONSULT WITH AN ATTORNEY PRIOR TO EXECUTION OF THIS AGREEMENT AND
GENERAL RELEASE.

                  LORENZ AGREES THAT ANY MODIFICATIONS, MATERIAL OR OTHERWISE,
MADE TO THIS AGREEMENT AND GENERAL RELEASE DO NOT RESTART OR AFFECT IN ANY
MANNER THE ORIGINAL TWENTY-ONE DAY CONSIDERATION PERIOD.

                  HAVING ELECTED TO EXECUTE THIS AGREEMENT AND GENERAL RELEASE,
TO FULFILL THE PROMISES SET FORTH HEREIN, AND TO RECEIVE THEREBY THE SUMS AND
BENEFITS SET FORTH IN PARAGRAPH "2" ABOVE, LORENZ FREELY AND KNOWINGLY, AND
AFTER DUE CONSIDERATION, ENTERS INTO THIS AGREEMENT AND GENERAL RELEASE
INTENDING TO WAIVE, SETTLE AND RELEASE ALL CLAIMS SHE HAS OR MIGHT HAVE AGAINST
EG&G.

                  IN WITNESS WHEREOF, the parties hereto knowingly and
voluntarily executed this Agreement and General Release as of the date set forth
below:


                                                  /s/ Deborah S. Lorenz
                                                  ------------------------------
                                                      Deborah S. Lorenz

                                                  Date:   June 6, 1998
                                                       -------------------------

                                                  EG&G, Inc.

                                                  By: /s/ John M. Kucharski
                                                     ---------------------------
                                                          John M. Kucharski

                                                  Date:   June 4, 1998
                                                       -------------------------

                                       5



<PAGE>   1
                                   EXHIBIT 21

                         Subsidiaries of the Registrant

As of March 2, 2000, the following is a list of the parent (Registrant) and its
active subsidiaries, together with their subsidiaries. Except as noted, all
voting securities of the listed subsidiaries are 100% beneficially owned by the
Registrant or a subsidiary thereof. The subsidiaries are arranged alphabetically
by state and then country of incorporation or organization.


<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------
                                                           State or Country      Name
                                                           of Incorporation      of
        Name of Company                                    or Organization       Parent

===============================================================================================================
<S>  <C>                                                   <C>                   <C>
1.   PerkinElmer, Inc.                                     Massachusetts         N/A
2.   PerkinElmer Instruments, Inc.                         California            PKI
3.   PerkinElmer Instruments, Inc.                         Delaware              Holdings
4.   EG&G Japan, Inc.                                      Delaware              Holdings
5.   PerkinElmer Optoelectronics, Inc.                     Delaware              PKI Opto SC
6.   Lumen Technologies, Inc.                              Delaware              PKI
7.   PerkinElmer Optoelectronics NC, Inc.                  Delaware              Lumen
8.   PerkinElmer Optoelectronics SC, Inc.                  Delaware              Lumen
9.   PerkinElmer Instruments LLC                           Delaware              PKI
10.  Genomic Solutions Inc.                                Delaware              PKI (8%)
11.  Vivid Technologies, Inc.                              Delaware              PKI
12.  PerkinElmer Wallac Inc.                               Maryland              PKI
13.  EG&G Ventures, Inc.                                   Massachusetts         PKI
14.  PerkinElmer Holdings, Inc.                            Massachusetts         PKI (94%)1
15.  PerkinElmer Automotive Research, Inc.                 Texas                 Holdings
16.  Perkin-Elmer Argentina S.R.L                          Argentina             Holdings
17.  EG&G Vertriebs GmbH                                   Austria               BV
18.  EG&G Perkin Elmer Pty Limited                         Australia             Holdings
19.  PerkinElmer Belgium NV/SA                             Belgium               PKI (96.8%)2
20.  PerkinElmer do Brasil Ltda.                           Brazil                CV (94.6%)3
21.  PerkinElmer Canada Investments Inc.                   Canada                CV
22.  PerkinElmer Canada Inc.                               Canada                PKI
23.  Bragg Photonics, Inc.                                 Canada                PKI Canada Inc. (13%)
24.  PerkinElmer Instruments International Ltd.            Cayman Islands        CV
25.  PerkinElmer Philippines, Ltd.                         Cayman Islands        CV
26.  Perkin Elmer Chile Limitada                           Chile                 Holdings4
27.  PerkinElmer Shenzhen Industrial Ltd.                  China                 PKI Opto (Germany)
28.  Shanghai EG&G Reticon Optoelectronics Co. Ltd.        China                 PKI (50%)
29.  Perkin Elmer de Centro America S.A.                   Costa Rica            Holdings
30.  Perkin-Elmer S.R.O.                                   Czech Republic        BV
31.  PerkinElmer A/S                                       Denmark               Wallac Oy
32.  PerkinElmer Egypt                                     Egypt                 CV
33.  PerkinElmer Oy                                        Finland               BV
34.  Wallac Oy                                             Finland               PKI Oy (Finland)
35.  PerkinElmer S.A.S.                                    France                PKI Europe BV (Netherlands)
36.  Berthold France S.A.                                  France                PKI SAS (France)
37.  Societe Civile Immobiliere                            France                PKI SAS (80%)5
38.  PerkinElmer Instruments GmbH                          Germany               Holdings
39.  PerkinElmer Holding GmbH                              Germany               PKI
40.  Wallac Distribution GmbH                              Germany               PKI Instruments GmbH
41.  PerkinElmer Instruments International Ltd. & Co. KG   Germany               CV (100%)6
42.  Berthold GmbH & Co. KG                                Germany               PKI Instruments GmbH (58%)7,
</TABLE>


--------
1  PerkinElmer Instruments, Inc., Delaware corporation, owns the remaining 6%.
2  PerkinElmer Instruments LLC owns the remaining 3.2%.
3  PerkinElmer Holdings, Inc. (5%), PerkinElmer Wallac Inc., Maryland
   corporation, owns a de minimus share.
4  PerkinElmer Instruments LLC owns a de minimus share.
5  Berthold France S.A. owns the remaining 20%.
6  PerkinElmer Instruments International, Cayman Islands corporation owns a de
   minimus share.
7  PerkinElmer Holding GmbH owns 2.3%, PerkinElmer Automotive Research, Inc.
   owns 39.7%.


<PAGE>   2


<TABLE>
<S>  <C>                                                   <C>                   <C>
43.  PerkinElmer Optoelectronics GmbH                      Germany               Berthold GmbH & Co
44.  PerkinElmer Limited                                   Hong Kong             CV (99%)8
45.  Perkin-Elmer Hungaria Kft                             Hungary               BV
46.  PT Perkinelmer Batam                                  Indonesia             Holdings
47.  EG&G Srl                                              Italy                 BV
48.  Perkin Elmer Italia SpA                               Italy                 EG&G Srl, Italy
49.  NOK EG&G Optoelectronics Corporation                  Japan                 PKI (49%)
50.  Seiko EG&G Co. Ltd.                                   Japan                 PKI (49%)
51.  WALLAC Berthold Japan Co., Ltd.                       Japan                 Wallac Oy (80%)
52.  Perkin-Elmer Japan Co., Ltd.                          Japan                 Holdings
53.  Perkin Elmer Yuhan Hoesa                              Korea                 BV
54.  Perkin Elmer Sdn. Bhd.                                Malaysia              CV
55.  Perkin Elmer de Mexico, S.A.                          Mexico                Holdings9
56.  PerkinElmer Europe B.V.                               Netherlands           BV
57.  Wellesley B.V.                                        Netherlands           CV
58.  PerkinElmer International, C.V.                       Netherlands           Holdings (99%)10
59.  PerkinElmer Norge AS                                  Norway                Wallac Oy
60.  EG&G Omni, Inc.                                       Philippines           Holdings
61.  Perkin-Elmer Instruments (Philippines) Corporation    Philippines           Holdings
62.  Perkin Elmer Polska Sp zo.o.                          Poland                BV
63.  Wellesley Portugal - Instumentos Cientificos, LDA     Portugal              BV (100%)11
64.  PerkinElmer Rus                                       Russia                PKI Oy
65.  PerkinElmer Singapore Pte Ltd.                        Singapore             CV
66.  EG&G Perkin-Elmer South Africa (Proprietary) Limited  South Africa          CV
67.  PerkinElmer Espana, S.L.                              Spain                 BV
68.  PerkinElmer Sverige AB                                Sweden                Wallac Oy
69.  PerkinElmer (Schweiz) AG                              Switzerland           BV
70.  Wallac Distribution AG                                Switzerland           Wallac Distribution GmbH (90%)
71.  EG&G Perkin-Elmer Corporation                         Taiwan                CV
72.  Perkin Elmer Limited                                  Thailand              CV
73.  Life Science Resources Limited                        United Kingdom        Holdings
74.  PerkinElmer UK Holdings Ltd.                          United Kingdom        BV
75.  PerkinElmer Ltd.                                      United Kingdom        PKI UK Holdings Ltd
76.  PerkinElmer Services Ltd.                             United Kingdom        PKI UK Holdings Ltd
77.  Q-Arc Ltd.                                            United Kingdom        PKI UK Holdings Ltd.
78.  PerkinElmer (UK) Ltd.                                 United Kingdom        PKI UK Holdings Ltd.
79.  Vivid Technologies UK Ltd.                            United Kingdom        Vivid Technologies, Inc.
80.  EG&G Exporters Ltd.                                   U.S. Virgin Islands   Holdings
81.  ILC Light Source Foreign Sales Corporation            U.S. Virgin Islands   PKI Opto NC
82.  Optical Radiation Foreign Sales Corporation           U.S. Virgin Islands   PKI Opto SC
</TABLE>



--------
8  Wellesley BV owns a de minimus share.
9  PKI owns a de minimus share.
10 PKI owns the remaining 1%.
11 PerkinElmer International CV owns a de minimus share.


BV=Wellesley BV, CV=PerkinElmer International CV, Holdings=PerkinElmer Holdings,
Inc., Lumen=Lumen Technologies, Inc., PKI=PerkinElmer, Inc., PKI Opto SC=
PerkinElmer Optoelectronics SC, Inc., PKI Opto NC=PerkinElmer Optoelectronics
NC, Inc.





<TABLE> <S> <C>

<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET AS OF JANUARY 2, 2000 AND THE CONSOLIDATED INCOME
STATEMENT FOR THE YEAR ENDED JANUARY 2, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
       
<S>                             <C>
<PERIOD-TYPE>                   12-MOS
<FISCAL-YEAR-END>                          JAN-02-2000
<PERIOD-START>                             JAN-04-1999
<PERIOD-END>                               JAN-02-2000
<EXCHANGE-RATE>                                      1
<CASH>                                         126,650
<SECURITIES>                                         0
<RECEIVABLES>                                  346,160
<ALLOWANCES>                                    12,928
<INVENTORY>                                    201,724
<CURRENT-ASSETS>                               815,094
<PP&E>                                         496,347
<DEPRECIATION>                                 268,313
<TOTAL-ASSETS>                               1,714,640
<CURRENT-LIABILITIES>                          852,498
<BONDS>                                        114,855
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                        60,102
<OTHER-SE>                                     490,674
<TOTAL-LIABILITY-AND-EQUITY>                 1,714,640
<SALES>                                      1,206,038
<TOTAL-REVENUES>                             1,363,129
<CGS>                                          746,417
<TOTAL-COSTS>                                  863,317
<OTHER-EXPENSES>                               450,910
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                              28,284
<INCOME-PRETAX>                                 44,870
<INCOME-TAX>                                    16,499
<INCOME-CONTINUING>                             28,371
<DISCONTINUED>                                 125,945
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                   154,316
<EPS-BASIC>                                       3.39
<EPS-DILUTED>                                     3.31
        

</TABLE>