Appendix A-2

                               AMENDMENT NO. 2 TO
                          AGREEMENT AND PLAN OF MERGER

      This  AMENDMENT  NO. 2 TO AGREEMENT  AND PLAN OF MERGER (the  "Amendment")
hereby  further  amends the Agreement and Plan of Merger dated as of October 19,
1999,  as amended by Amendment No. 1 to Agreement and Plan of Merger dated as of
April 12, 2000 (the "Merger  Agreement"),  as set forth below. This Amendment is
dated as of July 28, 2000, and is by and among Thermo  Electron  Corporation,  a
Delaware  corporation  ("Thermo  Electron"),   TTT  Acquisition  Corporation,  a
Delaware  corporation and a wholly-owned  subsidiary of Thermo Electron ("Merger
Sub"), and Thermo TerraTech Inc., a Delaware corporation ("TerraTech").

                                    RECITALS

      A. On November 9, 1999, Thermo Electron filed a Registration  Statement on
Form  S-4  with  the  Securities  and  Exchange  Commission  (as  amended,   the
"Registration  Statement")  in order to register the shares of its common stock,
$1.00 par value per share, to be issued to the public  stockholders of TerraTech
in the  proposed  merger  with Merger Sub (the  "Merger"),  as  contemplated  by
Section 5.1 of the Merger Agreement.

      B. In response to comments from the  Securities  and Exchange  Commission,
Thermo  Electron  and  TerraTech  have  filed  amendments  to  the  Registration
Statement on November 30, 1999, April 28, 2000 and July 26, 2000.

      C. As of the date of this  Amendment,  Thermo  Electron and  TerraTech are
working with the  Securities  and Exchange  Commission  to resolve the remaining
comments on the Registration Statement, but Thermo Electron and TerraTech expect
that such comments will not be resolved in time to allow the consummation of the
Merger to take place by July 31, 2000.

      D. Thermo Electron,  TerraTech and Merger Sub each desire, in light of the
foregoing, to amend the Merger Agreement as set forth below.

      NOW,   THEREFORE,   in  consideration  of  the  covenants,   promises  and
representations set forth herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged,  the parties agree
as follows:

      Section  7.1(b) of the Merger  Agreement is hereby amended and restated in
its entirety to read as follows:
<PAGE>

      " (b) by either  TerraTech (at the direction of the Special  Committee) or
Merger Sub if the Merger shall not have been  consummated by September 30, 2000;
provided, however, that the right to terminate this Agreement under this Section
7.1(b)  shall not be  available  to any party whose action or failure to act has
been a  principal  cause of or resulted in the failure of the Merger to occur on
or before  such date if such  action or failure to act  constitutes  a breach of
this Agreement."

      IN WITNESS WHEREOF, Thermo Electron,  Merger Sub and TerraTech have caused
this  Amendment to be signed by themselves or their duly  authorized  respective
officers, all as of the date first written above.


                              THERMO ELECTRON CORPORATION



                              By:    /s/ Theo Melas-Kyriazi
                                     -------------------------------------------
                              Name:  Theo Melas-Kyriazi
                              Title: Vice President and Chief Financial Officer


                              TTT ACQUISITION CORPORATION



                              By:    /s/ Theo Melas-Kyriazi
                                     -------------------------------------------
                              Name:  Theo Melas-Kyriazi
                              Title: President


                              THERMO TERRATECH INC.



                              By:    /s/ Brian D. Holt
                                     -------------------------------------------
                              Name:  Brian D. Holt
                              Title: President and Chief Executive Officer