SCHEDULE 14A
(RULE 14A-101)14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
DONALDWON COMPANY, INC.[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
Donaldson Company, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)Statement, if other than the Registrant)
Payment of filing feeFiling Fee (Check the appropriate box):
[X] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transactions applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to exchangeExchange Act Rule 0-11:10-11. (Set forth the amount on which the
filing fee is calculated and state how it was determined.)
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the formForm or scheduleSchedule and the date of its filing.
(1) Amount previously paid:
(2) Form, scheduleSchedule or registration statement no.Registration Statement No.:
(3) Filing party:
(4) Date filed:
1 Set forth the amount on which the filing fee is calculated and state how it
was determined.
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[LOGO] DONALDSON
DONALDSON COMPANY, INC.
NOTICE OF
ANNUAL MEETING OF SHAREHOLDERSSTOCKHOLDERS
TIME: 10:00 a.m., central time, Friday, November 17, 199515, 1996
PLACE: Lutheran Brotherhood Auditorium, 625 Fourth Avenue South,
Minneapolis, Minnesota.
ITEMS OF (1) Election of three directors;
BUSINESS:
(2) Ratification of Ernst & Young LLP as independent auditors
of the Company; and
any other business that properly comes before the meeting.
RECORD DATE: ShareholdersStockholders of record at the close of business on
September 29,
199527, 1996 are entitled to notice of and to vote at
the meeting or any adjournment. A list of such shareholders
will be available prior to the meeting at the office of the
Company, 1400 West 94th Street, Minneapolis, Minnesota for
examination by any such shareholderstockholder for any purpose germane
to the meeting.
By Order of the Board of Directors
Raymond F. Vodovnik/s/ Norman C. Linnell
Norman C. Linnell
Secretary
Dated: October 16, 199515, 1996
IMPORTANT
YOU CAN HELP US PREPARE FOR THE MEETING AND ELIMINATE EXTRA EXPENSE -- WHETHER
YOU HAVE A FEW SHARES OR MANY -- IF YOU WILL COMPLETE AND RETURN THE ENCLOSED
PROXY PROMPTLY. YOUR PROMPT REPLY WILL ELIMINATE EXTRA EXPENSE IN SOLICITING
YOUR PROXY.
- --------------------------------------------------------------------------------
DONALDSON COMPANY, INC.
1400 WEST 94TH STREET
MINNEAPOLIS, MINNESOTA 55431
PROXY STATEMENT
MAILING DATE OCTOBER 16, 199515, 1996
SOLICITATION OF PROXIES
The enclosed proxy is solicited by and on behalf of the Board of Directors of
Donaldson Company, Inc. (the "Company") for use at the Annual Meeting of
ShareholdersStockholders to be held on November 17, 1995.15, 1996, and at any adjournments thereof.
The person signing a proxy may revoke it any time before it is exercised. Each
valid proxy received prior to the meeting will be voted according to the
shareholder'sstockholder's directions.
The cost of this solicitation of proxies will be borne by the Company. In
addition to solicitation of proxies by the use of the mails, there may be
incidental personal solicitations by telephone, special communications or in
person, by officers, directors and regular employees of the Company who will not
receive additional compensation therefor. The Company will also requestreimburse banks,
brokerage houses,firms and other nominees, custodians and fiduciaries to forward soliciting materialfor reasonable
expenses incurred by them in sending proxy materials and annual reports to the
beneficial owners of stockstock. This proxy statement and will reimburse such persons for their expenses so
incurred.the accompanying proxy are
first being mailed to stockholders on or about October 15, 1996.
VOTING SECURITIES
ShareholdersStockholders of record as of the close of business on September 29, 199527, 1996 will be
entitled to vote at the meeting. The Company then had 25,954,964approximately 25,161,436
shares of Common Stock outstanding, each of which entitles its holder to one
vote. Representation at the meeting of a majority of the outstanding shares is
required for a quorum.
Votes that areIf an executed proxy card is returned and the stockholder has abstained from
voting on any matter or, in the case of the election of directors has withheld
and broker non-votesauthority to vote with respect to any or all of the nominees, the shares
represented by such proxy will be countedconsidered present at the meeting for purposes
of determining a quorum and for purposes of calculating the vote, but will not
be considered to have been voted in favor of such matter or, in the case of the
election of directors, in favor of such nominee or nominees. If an executed
proxy is returned by a broker holding shares in street name which indicates that
the broker does not have discretionary authority as to certain shares to vote on
one or more matters, such shares will be considered present at the meeting for
purposes of determining a quorum, but will not be considered to be represented
at the meeting for purposes of determining whether a
quorum exists. However,calculating the vote with respect to such votes will be treated as shares not voted for
purposes of determining the number of shares voted for or against any nominee
for director or any proposal. The affirmative vote of a majority of the
shares represented at the meeting and voting on the issue will be necessary
for election of the directors.matter.
Shares of Common Stock credited to the accounts of participants in the Automatic
Dividend Reinvestment Program of the Company have been added to the
participants' other holdings and included in the enclosed proxy. Participants in
the Company's employee benefit plans are entitled to instruct the plan trustee
on how to vote all shares of Donaldson Common Stock allocated to their accounts
under the plans and will receive a separate voting instruction card for voting
such shares. Shares for which the trustee receives no voting instructions from
participants, including unallocated shares held in the employee stock ownership
plan ("ESOP"), will be voted by the trustee in the same proportion as shares for
which instructions are received.
SECURITY OWNERSHIP
Set forth below is information regarding persons known by the Company to own
beneficially (as defined by the SEC for proxy statement purposes) more than 5% of the outstanding Common Stock of the Company:
NAME AND ADDRESS AMOUNT AND NATURE PERCENT
OF BENEFICIAL OWNER OF BENEFICIAL OWNERSHIP OF CLASS
Donaldson Company Inc.
Employeebased
on the number of shares of Common Stock Ownership Plan 3,271,178(1) 12.6%
c/o Fidelity Management Trust Company
82 Devonshire Street
Boston, MA 02109
Mario J. Gabelli 1,450,000(2) 5.6%
655 Third Avenue
New York, NY 11017
First Bank System, Inc 1,435,841(3) 5.5%outstanding on September 27, 1996:
NAME AND ADDRESS AMOUNT AND NATURE PERCENT
OF BENEFICIAL OWNER OF BENEFICIAL OWNERSHIP OF CLASS
- ------------------- ----------------------- --------
Donaldson Company, Inc.
Employee Stock Ownership Plan............... 3,743,407(1) 14.9%
c/o Fidelity Management Trust Company
82 Devonshire Street
Boston, MA 02109
Pioneering Management Corporation........... 2,412,800(2) 9.6%
60 State Street
Boston, MA 02109
First Bank System, Inc...................... 1,517,828(3) 6.0%
601 Second Avenue South
Minneapolis, MN 55402
Mario J. Gabelli............................ 1,266,850(4) 5.0%
One Corporate Center
Rye, NY 10580-1434
- ----------------------------
(1) These shares are held in trust for the benefit of participants in the
Company's ESOP for which Fidelity Management Trust Company is the trustee
and claims no voting or investment power over the indicated shares. (See
also discussion above on voting rights under employee benefit plans.)
(2) Pioneering Management Corporation is a registered investment adviser with
sole voting power with respect to all 2,412,800 shares and shared
investment power with respect to all 2,412,800 shares. Information is
based solely on a Schedule 13G filed with the Securities and Exchange
Commission by Pioneering Management Corporation with respect to shares
held as of January 26, 1996.
(3) First Bank System, Inc. is a holding company for one or more subsidiary
banks which have sole voting power with respect to 617,168 shares; shared
voting power with respect to 513,579 shares; sole investment power with
respect to 576,414 shares and shared investment power with respect to
911,156. Information is based solely on a Schedule 13G filed with the
Securities and Exchange Commission by First Bank Systems, Inc. with
respect to shares held as of December 31, 1995.
(4) Mario J. Gabelli directly or indirectly controls various entities which
are primarily investment advisors and which generally have sole
investment and voting power as to the shares owned by the individual
entity. (3) First Bank System, Inc.Information is based solely on a holding company for one or more subsidiary
banks which have sole voting powerSchedule 13D filed with the
Securities and Exchange Commission by Mario J. Gabelli with respect to
514,197 shares; shared
voting power with respect to 516,711 shares; sole investment power with
respect to 478,581 shares and shared investment power with respect to
932,056.held as of July 19, 1996.
The following table sets forth information regarding the beneficial ownership of
the Company's Common Stock by each director, each of the Named Officers and all
executive officers and directors of the Company as a group. TOTAL PERCENT EXERCISABLE
NAME OF INDIVIDUAL OR GROUP SHARES (1) OF CLASS OPTIONS
William A. Hodder 1,266,921 4.7 456,022
William G. Van Dyke 419,513 1.6 242,004
Richard M. Negri 206,011 * 87,112
Erland D. Anderson 196,342 * 82,470
James R. Giertz 17,078 * 15,000
C. Angus Wurtele. 14,799 * 6,000
Kendrick B. Melrose 14,325 * 6,000
S. Walter Richey 13,865 * 6,000
Stephen W. Sanger 9,974 * 6,000
Jack W. Eugster 8,407 * 4,000
Michael R. Bonsignore 6,946 * 6,000
A. Gary Ames 6,257 * 4,000
F. Guillaume Bastiaens 100 * -0-
DirectorsExcept as otherwise
indicated, the named beneficial owner has sole voting and Officers as a Group 2,518,549 9.3 1,130,316investment power with
respect to the shares held by such beneficial owner.
TOTAL PERCENT EXERCISABLE
NAME OF INDIVIDUAL OR GROUP SHARES (1) OF CLASS OPTIONS
- --------------------------- ---------- -------- -----------
William A. Hodder 1,237,590 4.9 441,022
William G. Van Dyke 419,513 1.7 239,266
Nickolas Priadka 109,494 * 54,490
James R. Giertz 39,030 * 20,000
Lowell F. Schwab 21,159 * 9,548
C. Angus Wurtele. 17,823 * 8,000
Kendrick B. Melrose 17,055 * 8,000
S. Walter Richey 16,908 * 8,000
Stephen W. Sanger 13,166 * 8,000
Jack W. Eugster 11,137 * 6,000
Michael R. Bonsignore 9,196 * 8,000
F. Guillaume Bastiaens 2,946 * 2,000
Paul B. Burke 1,000 * 0
Janet M. Dolan 165 * 0
Directors and Officers as a Group 2,175,971 8.6 949,677
- ------------------------
* Less than 1%
(1) Includes restricted shares, shares owned by related household members or held in trust (including the ESOP
allocation for years prior to F'95)F'96) and the shares which the directors and officers have a present right to acquire
pursuant to the Company's stock option plansunderlying options
exercisable within 60 days, as listed under the Exercisable Options
column. The total shares for Mr. Van Dyke includes 632 shares held in a
family trust of which Mr. Van Dyke is the trustee and 4,128 shares held
by Mr. Van Dyke's wife.
ELECTION OF DIRECTORS
The Bylaws of the Company provide that the Board of Directors is composedshall consist of
ten members.not less than three nor more than 15 directors and that the number of directors
may be fixed from time to time by the affirmative vote of a majority of the
directors. At its meeting of September 20, 1996, the Board of Directors fixed
the number of directors constituting the entire Board at ten. Vacancies and
newly created directorships resulting from an increase in the number of
directors may be filled by a majority of the directors then in office and the
directors so chosen will hold office until the next election of the class for
which such directors shall have been chosen and until their successors are
elected and qualified. Directors are elected for a term of three years with
positions staggered so that approximately one-third of the directors are elected
at each annual meeting of the shareholders.stockholders. The terms of F. Guillaume Bastiaens,
Janet M. Dolan and S. Walter Richey expire at the annual meeting. Mr. Richey was
elected a director at the 1993 annual meeting, Mr. Bastiaens was elected by the
Board effective September 1, 1995 and Ms. Dolan was elected by the Board
effective July 26, 1996. It is intended that proxies received will be voted,
unless authority is withheld, forFOR the election of the nominees presented on Page
3,4, namely Messrs. Hodder, MelroseF. Guillaume Bastiaens, Janet M. Dolan and Sanger.S. Walter Richey. The
election of each nominee requires the affirmative vote of the holders of a
plurality of the shares cast in the election of directors.
The Board of Directors meets on a regularly scheduled basis. During the past
fiscal year the Board held six meetings. Except for Mr. Ames, eachEach director attended at least 75% of
the aggregate of the Board meetings and meetings of Board committees on
which each served.
The Board of Directors has assigned certain responsibilities to standing
committees. The Audit Committee composed of directors A.Gary Ames,Janet M. Dolan, Jack W.
Eugster, Kendrick B. Melrose, S. Walter Richey and Stephen W. Sanger
(Chairman)(Chairperson), all non-employee directors, held two meetings during the past
fiscal year. Briefly stated, functionsFunctions of the Audit Committee include: recommending to the
Board of Directors independent public auditors for the Company, reviewing the
scope and results of the auditors' examination, and reviewing the internal
audit program, adequacy of internal controls, and adherence to applicable
legal, ethical and regulatory requirements.
The Human Resources Committee, composed of directors Michael R. Bonsignore,
Paul B. Burke, Jack W. Eugster, Kendrick B. Melrose, Stephen W. Sanger, and
C. Angus Wurtele (Chairman)(Chairperson), all non-employee directors, held one meetingsix meetings
during the past fiscal year. The functions of this Committeecommittee include review
of management development, approval of compensation arrangements for senior
management and administration of the Company's stock compensation plans.
The Committee on Directors' Affairs, composed of directors A. Gary Ames,
Michael R. Bonsignore
(Chairman)(Chairperson), Paul B. Burke, Janet M. Dolan, S. Walter Richey, and C. Angus
Wurtele, all non-employee directors, held one meeting during the past fiscal
year. The committee's duties are to review the organization of the Board and its
committees, remuneration arrangements for the directors, propose to the Board a
slate of directors for election by the shareholdersstockholders at each Annual Meeting and
propose candidates to fill vacancies on the Board. The Committee will consider
nominees for director recommended by shareholders.stockholders. Recommendations should be
addressed to the Secretary, Donaldson Company, Inc., P.O. Box 1299, Minneapolis,
MN 55440. Any proposal by a stockholder for the nomination of a candidate for
director at the annual meeting for the election of directors is required by the
Company's Bylaws to be submitted in writing to the Secretary and received at the
principal executive offices of the Company not less than sixty days nor more
than 90 days prior to the date of the annual meeting.
The Board of Directors has no reason to believe that any nominees will be
unavailable or unable to serve, but in the event any nominee is not a candidate
at the meeting, the persons named in the enclosed proxy intend to vote in favor
of the remaining nominees and of such other person, if any, as they may
determine.
The table below and on the following page sets forth additional information with
respect to each nominee for election as a director and each other person whose
term of office as a director will continue after the meeting.
NOMINEES FOR ELECTION
NAME PRINCIPAL OCCUPATION AND BUSINESS EXPERIENCE
- ---- --------------------------------------------------------------------------------------
FOR A TERM EXPIRING IN 1998:
William A. Hodder Chairman and Chief Executive Officer of the Company. Also a director of Norwest
Age - 64 Corporation, Tennant Company, ReliaStar Financial Corp., Musicland Stores Corp. and
Director since 1969 Supervalu Inc.
Kendrick B. Melrose Chairman and Chief Executive Officer of The Toro Company (manufacturer of outdoor
Age - 55 maintenance products). Also a director of The Toro Company and The Valspar Corporation.
Director since 1991
Stephen W. Sanger Chairman and Chief Executive Officer of General Mills, Inc. (1995) (consumer products
Age - 49 and services). Previously an executive officer of various groups and divisions of
Director since 1992 General Mills, Inc. Also a director of General Mills, Inc.
DIRECTORS CONTINUING IN OFFICE
NAME PRINCIPAL OCCUPATION AND BUSINESS EXPERIENCE
TERMS EXPIRING IN 1996:
A. Gary Ames President and Chief Executive Officer of U.S. West International (1995). Previously
Age - 51 President and Chief Executive Officer of U.S. West Communications. Also a director
Director since 1993 of Albertson's, Inc. and Tektronix, Inc.
S. Walter Richey President and Chief Executive Officer of Meritex, Inc. and its predecessor corporation
Age - 59 Space Center Company (owns and manages business properties and distribution centers).
Director since 1991 Also a director of Meritex, Inc., First Bank Systems, Inc. and BMC Industries, Inc.1999:
F. Guillaume Bastiaens Executive Vice President (1995) and President, Food Sector and Chief Technology Officer
Age - 52 Officer53 of Cargill, Incorporated (Agribusiness). Also, a director of Cargill, Incorporated.
Director since 1995
Janet M. Dolan Executive Vice President (1996) of Tennant Company (manufacturer of floor maintenance
Age - 47 equipment and coating products). Previously Sr. Vice President, Secretary and General
Elected a Director IncorporatedCounsel of Tennant Company. Also, a director of William Mitchell College of Law.
effective September 1, 1995July 26, 1996
S. Walter Richey Chief Executive Officer and President of Meritex, Inc. and its predecessor corporation
Age - 60 Space Center Company (owns and manages business properties and distribution centers).
Director since 1991 Also, a director of Meritex, Inc., First Bank Systems, Inc. and BMC Industries, Inc.
DIRECTORS CONTINUING IN OFFICE
NAME PRINCIPAL OCCUPATION AND BUSINESS EXPERIENCE
- ---- ------------------------------------------------------------------------------------
TERMS EXPIRING IN 1997:
Michael R. Bonsignore Chairman (1993) and Chief Executive Officer and Chairman of Honeywell Inc. (1993) (manufacturer
of
Age - 5455 of electronic controls). Previously Executive Vice President and Chief Operating
Officer
Director since 1988 Officer of Honeywell Inc. Also, a director of Honeywell Inc., Cargill, Incorporated and The St. Paul
Companies, Inc.
Jack W. Eugster Chairman, President and Chief Executive Officer of Musicland Stores Corp. (retail
Age - 5051 consumer products). Also, a director of Musicland Stores Corp., Damark, Inc., Midwest Resources Company,
Director since 1993 Resources Company, and Shopko Stores, Inc.
William G. Van Dyke President and Chief Operating Officer of the Company. (1994) Previously, Executive
Age - 5051 Vice President (1992) and Vice President -- Industrial Group of the Company. Also,
Director since 1994 a director of Graco Inc.
C. Angus Wurtele Chairman of the Board of The Valspar Corporation (paint products). Also, a director
Age - 62 of Bemis Co. Inc., and General Mills, Inc.
Director since 1981
TERMS EXPIRING IN 1998:
Paul B. Burke Chairman, (1995) Chief Executive Officer and President of BMC Industries, Inc.
Age - 40 (manufacturer of precision imaged and optical products). Also, a director of Apogee
Elected a Director Enterprises, Inc. and The Optical Manufacturers Association.
July 26, 1996
Kendrick B. Melrose Chairman and Chief Executive Officer of The Valspar Corporation (paintToro Company (manufacturer of outdoor
Age - 6156 maintenance products). Also, a director of The Valspar Corporation, Bemis Co. Inc., and GeneralBSI Corporation
Director since 19811991 and Jostens, Inc.
Stephen W. Sanger Chairman and Chief Executive Officer of General Mills, Inc. (1995) (consumer products
Age - 50 and services). Previously, an executive officer of various groups and divisions of
Director since 1992 General Mills, Inc. Also, a director of Dayton Hudson Corporation.
DIRECTOR COMPENSATION
Directors who are not employees receive a retainer fee of $18,000 annually and
are paid $1,000 for each Board or Committee meeting attended. Committee Chairmen
receive an additional annual retainer of $2,500. Pursuant to the Company's
Compensation Plan for Non-Employee Directors, any non-employee director may
elect, prior to each year of his term, to defer all or part of his director
compensation received during the year. Each participating director is entitled
to a company credit on the balance in his deferral account at the same rate as
the company credit under the Fixed Income Fund of the Salaried Employees'
Retirement Savings Plan. The deferral election must also specify the manner for
distribution of the deferral balance.
The 1991 Master Compensation Plan, as amended, provides for the issuance of
restricted shares to non-employee directors in lieu of 30% of the annual
retainer for services as a Director to be rendered in the following service year
and allows an election to receive restricted shares in lieu of all or part of
the remaining retainer and meeting fees. Transfer of the shares is restricted
until the earliest of retirement, disability, termination of service (with
consent of the Board), death or a change in control of the Company.
The Company also has a nonqualified pension plan for non-employee directors
which provides for an annual retirement benefit for directors, who have served
at least five years, in an amount equal to the final annual retainer fee
received for services as a director. Such annual benefit is payable in a lump
sum or, at the election of the director, over a maximum fifteen year period or
such shorter period as is equal to the number of years of service on the Board
and provides for a benefit in the event of death.
The Company's Non-Qualified Stock Option Program for Non-employee Directors
provides for the automatic grant of a non-qualified stock option for 2,000
shares of Common Stock to each non-employee Director of the Company who is a
member of the Board between the dates of December 1 and December 22 each year.
The exercise price of such options is the closing price of Common Stock in
consolidated trading on the first business day of December in the respective
year. The options are exercisable on and after December 22 of the respective
year and have a term of ten years.
INDEPENDENT AUDITORS
Upon recommendation of its Audit Committee, the Board of Directors has appointed
Ernst & Young LLP as independent public accountants to audit the books and
accounts of the Company for the fiscal year ending July 31, 1997, such
appointment to continue at the pleasure of the Board of Directors and subject to
ratification by the stockholders. Ernst & Young LLP has audited the books and
accounts of the Company since 1951. Representatives of Ernst & Young LLP are
expected to be present at the meeting with the opportunity to make a statement
and to respond to appropriate questions. In the event this appointment is not
ratified, the Board will appoint other independent auditors for the subsequent
fiscal year.
The Board of Directors recommends that stockholders vote FOR ratification of the
appointment of Ernst & Young LLP as independent auditors for the fiscal year
ending July 31, 1997.
EXECUTIVE COMPENSATION
The following table sets forth as to each person who was at the end of fiscal
1995,1996, the Chief Executive Officer and the other four most-highly compensated
executive officers of the Company information concerning the cash and noncash
compensation for services rendered to the Company for each of the last three
fiscal years (the "Named Officers").
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION (1) LONG TERM COMPENSATION
ANNUAL COMPENSATION (1) (2)------------------------ --------------------------------------
AWARDS PAYOUTS
---------------------- -------------
RESTRICTED STOCK
STOCK OPTIONS ALL OTHER
NAME AND PRINCIPAL FISCAL AWARD(S) (SHARES) LTIP PAYOUTS COMPENSATION
POSITION YEAR SALARY ($) BONUS ($) ($) (2) ($) (3) ($) (4)
($) (5)- ------------------ ------ ---------- --------- ---------- -------- ------------ ------------
WILLIAM A. HODDER 1996 571,154 820,000 0 0 515,625 162,078
Chairman and Chief 1995 518,269 660,000 0 120,722 477,125 162,044
Chairman and ChiefExecutive Officer 1994 464,423 488,205 0 88,608 0 121,723
Executive Officer 1993 428,846 216,270 299,092 0 64,412
WILLIAM G. VAN DYKE 1996 385,000 462,000 0 54,362 190,125 121,960
President and Chief 1995 340,692 420,000 0 30,000 136,938 105,227
President and ChiefOperating Officer 1994 275,000 232,690 0 48,058 0 63,988
Operating Officer 1993 251,154 134,940 152,046 0 38,538
JAMES R. GIERTZ 1996 220,000 181,229 315,625(5) 15,300 0 50,434
Senior Vice President and 1995 174,615 165,870 0 25,000 0 0
Vice President andChief Financial Officer 1994 0 0 0 0 0 Chief Financial Officer 1993 0
NICKOLAS PRIADKA 1996 169,117 108,165 0 0 0 0
RICHARD M. NEGRI 1995 150,039 112,792 11,600 92,948 36,27210,300 129,050 37,174
Senior Vice President, 1995 149,616 97,771 108,675(5) 10,000 92,340 34,159
OEM Engine 1994 143,461 89,878 21,722136,423 70,179 0 28,474
Manufacturing 1993 137,038 46,592 33,84021,216 0 18,333
ERLAND D. ANDERSON 1995 152,462 99,982 31,736 94,163 34,80518,000
LOWELL F. SCHWAB 1996 148,808 88,911 0 8,148 0 32,546
Senior Vice President, 1995 128,340 81,400 108,675(5) 7,200 0 29,018
Operations 1994 146,038 80,259 11,60099,638 20,237 0 29,367
Corporate Technology 1993 138,615 41,350 33,8342,000 0 17,9680
- ---------------------
(1) Includes any portion deferred under the Management Compensation Plan.
(2) As of July 31, 1995 Mr. Van Dyke held an aggregate of 16,200 shares of
restricted stock valued at $429,300. Dividends are paid on all of the
reported restricted stock at the same rate as paid on the Company's common
stock.
(3) Shares adjusted for stock splits.
(4)(3) Earned under the Company's 1991 Master Stock Compensation Plan during the
three-year period ending July 31, 1995.in the fiscal year in which the payout is
listed. Payout is in the Company's common stock and delivered during the
following fiscal 1996.
(5)year.
(4) Amounts in this column represent the dollar value of share allocations
under the Company's ESOP and benefits in excess of the limits established
by Section 415 of the Internal Revenue Code ("IRC") contributed by the Company to
an unqualified supplemental plan. The amounts for fiscal 19951996 are:
NAME ESOP ESOP (SUPL.)
- ---- ---- ------------
William A. Hodder $19,390 $142,688
William G. Van Dyke 19,390 102,570
James R. Giertz 19,390 31,044
Nickolas Priadka 19,390 17,784
Lowell F. Schwab 19,390 13,156
(5) Amounts in the Restricted Stock Award column represent the dollar value
of grants of restricted stock under the Company's 1991 Master Stock
Compensation Plan. Regular dividends are paid on the restricted shares.
At the end of fiscal 1996, the number and value of the aggregate
restricted stockholdings for the Named Officers were: William A. Hodder,
0, $0; William G. Van Dyke, 16,200, $421,200; James R. Giertz, 12,500,
$325,000; Nickolas Priadka, 12,300, $319,800; Lowell F. Schwab, 4,200,
$109,200.
NAME ESOP ESOP (SUPL.)
William A. Hodder $20,750 $141,294
William G. Van Dyke 20,750 84,477
Richard M. Negri 20,750 15,522
Erland D. Anderson 20,750 14,055
OPTIONS GRANTED IN FISCAL 1995
OPTIONS GRANTED IN FISCAL 1996
POTENTIAL REALIZABLE GAINVALUE AT
ASSUMED ANNUAL RATES OF STOCK
PRICE APPRECIATION FOR OPTION
INDIVIDUAL GRANTS (1) PRICE APPRECIATIONTERM (3)
-------------------------------------------------------- --------------------------------
NUMBER OF % OF TOTAL
SHARES OPTIONS
OPTIONS EXERCISE
GRANTEDUNDERLYING GRANTED TO EXERCISE
OPTIONS EMPLOYEES OR BASE EXPIRATION
NAME (SHARES)GRANTED (2) EMPLOYEESIN FY 1996 PRICE ($) DATE 0% ($) 5% ($) 10% ($)
- ---- ----------- ---------- --------- ---------- ------ ------- --------
WILLIAMWilliam A. HODDER 80,000 (4) 26.0 22.375 12/15/04Hodder 0 1,127,144 2,857,226
40,722 (5) 13.2 28.000 12/14/03 0 580,119 1,406,189
WILLIAM G. VAN DYKE 30,000 (4) 9.8 22.375 12/15/04 0 422,679 1,071,460
JAMES R. GIERTZ 15,000 (6) 4.9 26.000 09/08/04 0 245,579 622,524
10,000 (4) 3.2 22.375 12/15/04 0 140,893 357,153
RICHARD M. NEGRI 11,600 (4) 3.8 22.375 12/15/04 0 163,436 414,298
ERLAND D. ANDERSON 11,600 (4) 3.8 22.375 12/15/04 0 163,436 414,298
9,759 (5) 3.2 25.875 12/21/02 0 126,250 305,004
10,377 (5) 3.4 25.875 12/14/03 0 153,970 382,359
ALL SHAREHOLDERS (7) N/A N/A 26.500 07/19/04 0 415,631,278 1,041,889,634
STOCK PRICE (7) N/A N/A N/A N/A N/A
42.373 66.289William G. Van Dyke 31,500 17.0 24.750 12/21/05 0 490,922 1,244,450
22,862 (4) 12.3 26.250 12/14/03 0 270,247 640,541
James R. Giertz 15,300 8.3 24.750 12/21/05 0 238,448 604,447
Nicolas Priadka 10,300 5.6 24.750 12/21/05 0 160,524 406,915
Lowell F. Schwab 7,300 3.9 24.750 12/21/05 0 113,769 288,396
848 (4) .5 26.500 07/26/03 0 9,319 21,781
(1) No stock appreciation rights ("SARs") have been granted.
(2) All grants (other than as noted in footnote (6)(4)) during the period were
non-qualified stock options granted at the market value on date of grant
exercisable within 30 daysfor a term of the date of grant,ten years, vesting in four equal annual installments
beginning 12/21/96, and were granted with the right to use shares in lieu
of the exercise price and to satisfy any tax withholding obligations.
(3) These amounts represent certain assumed rates of appreciation over the
full term of the option. The value ultimately realized, if any, will
depend on the amount that the market price of the Company's stock exceeds
the exercise price on date of sale.
(4) Annual grant of a non-qualified stock option. These options include a
reload feature in the event they are exercised while the executive is an
employee and the market price exceeds the exercise price by 25%.
(5) These grants were made to individuals who exercised an option during
fiscal 19951996 and made payment of the purchase price using shares of
previously owned Company stock. This restoration or "reload" grant is for
the number of shares equal to the shares used in payment of the purchase
price or withheld for tax withholding. The option price is equal to the
market value of the Company's stock on the date of exercise and will
expire on the same date as the original option which was exercised. These
options, which are the result of such a restoration, do not contain the
reload feature.
(6) This grant was made to Mr. Giertz as an employment incentive and includes a
reload and a three year vesting schedule.
(7) This value was calculated using the market price of Donaldson stock on, and
outstanding shares as of, July 31, 1995 and applying the assumed
appreciation over the weighted average option term of 9.6 years for all
options granted in fiscal 1995. In total, 27 key employees were granted
options for 307,799 shares at a weighted average exercise price of $23.762.
AGGREGATED OPTION EXERCISES IN FISCAL 1995
AGGREGATED OPTION EXERCISES IN FISCAL 1996 AND YEAR END OPTION VALUES
NUMBER OF SHARES VALUE OF UNEXERCISED
NUMBER OFUNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
OPTIONS AT 7/31/95 7/31/95FY-END AT FY-END (2)
SHARES VALUE ----------------------------- -----------------------------
ACQUIRED ON REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
NAME EXERCISE (1) ($) (SHARES) (SHARES) ($) ($)
- ---- ------------ -------- ----------- ------------- ----------- -------------
WILLIAMWilliam A. HODDER 63,700 494,681 456,022 0 3,038,823 0
WILLIAM G. VAN DYKEHodder 0 N/A 242,004441,022 0 1,835,1692,659,610 0
JAMESWilliam G. Van Dyke 25,600 142,400 239,266 31,500 1,578,167 39,375
James R. GIERTZGiertz 0 N/A 10,000 15,000 41,250 7,500
RICHARD M. NEGRI20,000 25,300 36,250 19,125
Nickolas Priadka 0 N/A 87,112 0 712,671 0
ERLAND D. ANDERSON 23,200 150,800 82,470 0 589,516 054,490 10,300 305,633 12,875
Lowell F. Schwab 1,000 7,938 9,548 8,800 35,132 18,157
- ------------------------
(1) The number of shares shown in this column is larger than the number of
shares actually acquired on exercise. The actual number of shares
received is reduced by the number of shares delivered in payment of the
exercise price and shares withheld to cover withholding taxes.
Share ownership
objectives for executive officers encourages retention of shares acquired
through option exercise.
(2) This value is based on the difference between the exercise price of such
options and the closing price of Donaldson stockCompany Common Stock as of July 31, 1995.fiscal
year-end 1996.
LONG-TERM INCENTIVE PLANS -- AWARDS IN LAST FISCAL YEAR
ESTIMATED FUTURE PAYOUTS
NUMBER OF SHARES, PERFORMANCE ESTIMATED FUTURE PAYOUTSUNDER NON-STOCK
SHARES, UNITS OR OTHER PERIOD UNDER NON-STOCKPRICE-BASED PLAN
OR OTHER UNTIL MATURATION PRICE-BASED PLAN-------------------------------
NAME RIGHTS (1) OR PAYOUT THRESHOLD TARGET MAXIMUM
- ---- ------------- ---------------- --------- ------ -------
WILLIAMWilliam A. HODDER 10,500Hodder 3,533 8/1/9495 - 7/31/97 5,250 10,500 15,750
WILLIAM98 1,767 3,533 5,300
William G. VAN DYKE 7,200Van Dyke 6,800 8/1/9495 - 7/31/97 3,600 7,200 10,800
JAMES98 3,400 6,800 10,200
James R. GIERTZ (2) 3,500Giertz 3,100 8/1/9495 - 7/31/97 5,250 10,500 15,750
RICHARD M. NEGRI 2,20098 1,550 3,100 4,650
Nickolas Priadka 2,500 8/1/9495 - 7/31/97 1,100 2,200 3,300
ERLAND D. ANDERSON 2,30098 1,250 2,500 3,750
Lowell F. Schwab 2,100 8/1/9495 - 7/31/97 1,150 2,300 3,45098 1,050 2,100 3,150
- ------------------------
(1) Awards are of Performance Units, each of which represents the right to
receive one share of the Company's common stock. Awards are earned only
if the Company achieves the minimum Performance Objectives and the Award
Value will be based on a weighting of compound corporate net sales growth
and after-tax return on investment over the three year period. The
amounts shown in the table under the headings "Threshold", "Target" and
"Maximum" are amounts awarded at 50%, 100% and 150% of the targeted
award. The award may also be adjusted upward by 25% for consistency if
earnings per share increase in each of the three year period by at least
5%.
(2) To compensate new participants for the first two years of the plan which
have no payout, the Award for such new participant's first cycle is
increased by 200%. The amounts shown for Mr. Giertz reflect the 200%
increase since the performance period presented is his first cycle.
HUMAN RESOURCES COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Human Resources Committee of the Board of Directors, consisting of fivesix
independent outside directors,(" ("the Committee") is responsible for establishing
the compensation programs for the Company's, executive officers. The objectives
of the Company's executive compensation program are to:
* attract and retain the best executives available in our industry;
* motivate and reward executives responsible for attaining the financial
and strategic objectives essential to the Company's long-term success and
continued growth in shareholderstockholder value;
* promote a pay-for-performance philosophy by placing significant portions
of pay at risk and requiring outstanding results for payment at the
threshold level;
* obtain an appropriate balance between short-term and long-term results
based on the executive's influence and impact;
* align the interests of executives with those of the Company's
shareholdersstockholders by providing a significant portion of compensation in the
form of Company common stock. Common stock ownership objectives have been
established for all executive officers ranging from sixfive to ten times
base salary.
BASE SALARIES. Base salaries for all executives are reviewed annually based on
performance and market conditions. A performance appraisal is required for all
executives of the Company. The Committee approves and/or determines the annual
base salary increases for all senior executives based on performance of the
executive and external market data. Our objective is that base salaries should
approximate the mid-point (average) of senior executives of manufacturing
companies of similar size in the United States. The Company uses nationally
known consultant surveys for external market data.
ANNUAL CASH INCENTIVE. Executive officers are eligible for target awards under
the annual incentive program ranging from 30%that range up to 60% of base salary. The size of
the target award is determined by the executive officer's position and
competitive data for similar positions at the peer and cross-industry companies
as presented in the same nationally recognized surveys as are used for the base
salary. The Company sets aggressive performance goals and, in keeping with the
strong performance-based philosophy, the resulting awards decrease or increase
substantially if actual Company performance fails to meet or exceed targeted
levels. Payments can range from 0% to 200% of the target awards. Executive
officers have from 80%up to 100% of their annual cash incentive opportunity linked to
Company
performance as measured byachieving record Earnings Per Share (EPS).
Consequently, executive officers must obtain record EPS, thereby increasing
shareholderstockholder value, to receive a competitive annual cash incentive.
LONG-TERM INCENTIVE COMPENSATION. The Long-Term Performance Award program is
based on three-year compounded growth in net sales at an after tax Return on
Investment that exceeds the Company's weighted cost of capital. Under this
program, the Committee selected eligible executives and established an incentive
opportunity as a percentage of base salary. In order for a participant to
receive a payout, minimum performance must be attained. Payout for the 1993-19951994-1996
cycle is listed in the Compensation Table. The Committee occasionally grants
restricted stock with a fixed restriction period usually five years, to insure
retention of key executives. The Committee also believes that significant stock
option grants encourage the executive officers to own and hold Donaldson stock
and tie their long-term economic interests directly to those of the
shareholders.stockholders. Stock options are typically granted annually. In determining the
number of shares covered by such options, the Committee takes into account
position levels, base salary, and other factors relevant to individual
performance but does not consider the amount and terms of options and restricted
stock already held by the executive.
STOCK OWNERSHIP. Ownership of Donaldson stock is expected of Donaldson
executives. The Committee believes that linking a significant portion of the
executive's current and potential net worth to the Company's success, as
reflected in the stock price, gives the executive a stake similar to the
shareholders.stockholders. The Committee has established stock ownership guidelines for the
Named Officers and certain other executive officers, which encourage retention
of shares obtained through the exercise of options. The guidelines range from
sixfive to ten times base salary. The goal of the Chief Executive Officer is ten
times annual base salary. Mr. Hodder and Mr. Van Dyke currently exceedsexceed this
ownership goal. Shares of stock received on exercise of all options during the
fiscal year by the Named Officers of the Company were retained and therefore are
subject to market risk.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER. Mr. Hodder's fiscal 19951996 base
salary and incentive award were determined by the Committee in accordance
with the methodology described above.
BASE SALARY. Mr. Hodder's base salary for fiscal 19951996 was $518,269$571,154 which
approximates the market mid-point for manufacturing companies of similar
size.
ANNUAL BONUS. Mr. Hodder's cash incentivebonus award for fiscal 19951996 was $660,000. This$820,000. Of
this amount, $660,000 was earned under the annual incentive program based
on EPS growth of 23.9%15.2% over the previous record of $1.17$1.45 earned in fiscal
1994.1995. A discretionary bonus of $160,000 recognized outstanding
performance.
STOCK OPTIONS. Due to his planned retirement, Mr. Hodder willdid not receive
the normal grant of stock options during fiscal 1996, to compensate for this
practice a larger than normal grant was received during fiscal 1995. In
addition he received one restoration option.1996.
POLICY ON QUALIFYING COMPENSATION. The Company's policy is to preserve the tax
deduction for compensation paid to its Chief Executive Officer and other senior
executive officers. In accordance with this policy, in November 1994 the
shareholdersstockholders approved the material terms of the performance goals for payment of
the cash bonus under the Company's Annual Cash Bonus Plan for Designated
Executives.
CONCLUSION. The executive officer compensation program administered by the
Committee provides incentive to attain strong financial performance and an
alignment with shareholderstockholder interests. The Committee believes that the Company's
compensation program focuses the efforts of Company executive officers on the
continued achievement of growth and profitability for the benefit of the
Company's shareholders.stockholders.
SUBMITTED BY THE HUMAN RESOURCES COMMITTEE OF THE BOARD OF DIRECTORS
C. Angus Wurtele, ChairmanChairperson
Michael R. Bonsignore
Paul B. Burke
Jack W. Eugster
Kendrick B. Melrose
Stephen W. Sanger
PERFORMANCE GRAPHGRAPHS
The following graph comparesgraphs compare the cumulative total shareholderstockholder return on the
Company's stockCommon Stock for the last five fiscal years and seven fiscal years
with the cumulative total return of the Standard & Poor's 500 Stock Index and
the Standard & Poor's Index of Manufacturing Companies. The first graph assumes
the investment of $100 in the Company's common stockCommon Stock and each of the indexes at
the market close on July 31, 1990fiscal year-end 1991 and the reinvestment of all dividends.
The second graph assumes the investment of $100 in the Company's Common Stock
and each of the indexes at the market close on fiscal year-end 1989 and the
reinvestment of all dividends. The Company believes the second graph is useful
in showing the cumulative total stockholder return over the seven year period of
consecutive increases in earnings per share.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
[GRAPH]
FISCAL YEARS ENDED JULY 31
1990 1991 1992 1993 1994 1995 1996
---- ---- ---- ---- ---- ----
DONALDSON $100 $115 $151 $188 $251 $277Donaldson $100.00 $131.00 $162.70 $217.28 $239.99 $223.50
S&P 500 100 112 127 138 145 183100.00 112.79 122.64 128.96 162.64 189.58
S&P MANUFACTURING 100 105 110 125 145 199Manufacturing 100.00 104.39 118.46 137.81 188.82 223.42
COMPARISON OF SEVEN YEAR CUMULATIVE TOTAL RETURN
[PLOT POINTS GRAPH]
FISCAL YEARS ENDED JULY 31
1989 1990 1991 1992 1993 1994 1995 1996
---- ---- ---- ---- ---- ---- ---- ----
Donaldson $100.00 $181.29 $209.95 $275.04 $341.57 $456.16 $503.83 $469.22
S&P 500 100.00 106.50 120.09 135.45 147.27 154.87 195.31 227.67
S&P Manufacturing 100.00 109.34 115.50 120.57 136.83 159.17 218.10 258.08
PENSION PLAN TABLE
ANNUAL BENEFITS FOR YEARS OF SERVICE SHOWN
-------------------------------------------------------------------------
FINAL AVERAGE COMPENSATION 10 YEARS 15 YEARS 20 YEARS 25 YEARS 30 YEARS 35 YEARS
- -------------------------- -------- -------- -------- -------- -------- --------
$ 200,000 $ 30,000 $ 45,000 $ 60,000 $ 75,000 $ 90,000 $ 95,000
400,000 60,000 90,000 120,000 150,000 180,000 190,000
600,000 90,000 135,000 180,000 225,000 270,000 285,000
800,000 120,000 180,000 240,000 300,000 360,000 380,000
1,000,000 150,000 225,000 300,000 375,000 450,000 475,000
1,200,000 180,000 270,000 360,000 450,000 540,000 570,000
The executive officers are eligible for the Company's non-contributory Salaried
Employees' Pension Plan which provides benefits based on length of service and
final average compensation, defined as the five highest consecutive years of the
last ten years of service. The amounts shown are for retirement at age 65 and
are reduced by varying amounts (not exceeding one-half) of the annual social
security benefit. Covered compensation for the named executive officers consists
of the amounts shown under "Annual Compensation" in the Summary Compensation
Table. As of July 31, 1995fiscal year-end 1996, Messrs. Hodder, Van Dyke, Giertz, NegriPriadka and
AndersonSchwab had benefit service of 20, 21, 0, 3522, 24, 1, 26 and 3019 years respectively. The table
does not reflect the limitations imposed by the Internal Revenue Code (the
"Code"). The Board of Directors established an Excess Benefit Plan which
provides for supplemental payments to be made to certain executives on
retirement so that they will receive, in the aggregate, the benefits they would
be entitled to receive if such Code limitations did not apply.
At July 31, 1995fiscal year-end 1996, the Company had a supplementary retirement benefit
agreement with Mr. Hodder providing for fifteen annual payments, after
retirement at age 65, to him or his beneficiaries. The size of the annual
payment is based on his termination or retirement date and upon the highest annual compensation
earned by him from the Company prior to such date if the Company has not
previously set a maximum level. The agreement provides for benefits in the event
of death prior to retirement and there is progressive vesting of other benefits.
Assuming the agreement is unchanged and employment until
normalBased on Mr. Hodder's retirement age, based on current compensation, annualafter fiscal year-end 1996, payments under the
agreement wouldwill be $152,617.$228,782 in the first year and then annual payments of
$206,265.
The Company has a supplementary retirement benefit plan which is intended to
assure that Messrs. Hodder, and Van Dyke will receive at least 60% of their
average (five highest years) compensation upon retirement at age 65 with 2%
reduction for each year in the event of early retirement after age 55. In
determining whether the plan must supplement other retirement benefits to reach
such level, the Company will consider the benefits described in the previous
paragraph, the Pension Plan Table and footnote (5) to the Summary Compensation
Table as well as 50% of primary Social Security and vested pension benefits from
prior employers, if any. Assuming the plan is unchanged and employment until age
65, based on current compensation and payment levels from other plans, no
payments would be made under the plan.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers to file initial reports of ownership and
reports of changes in ownership with the SEC and the New York Stock Exchange. BasedTo
the Company's knowledge, based on a review of copies of such forms and written
representations fromfurnished to the Company during fiscal 1996, all Section 16(a)
filing requirements applicable to the Company's directors and executive officers
the Company notes that William G. Van
Dyke, a Company officer, inadvertently failed to report a sale which occurred
on March 31, 1995. This information was reported on Form 4 for April 1995
following discovery of the error.were satisfied.
CHANGE-IN-CONTROL ARRANGEMENTS
Each of the Named Officers has a severance agreement with the Company designed
to retain the executive and provide for continuity of management in the event of
an actual or threatened change of control in the Company (as defined in the
agreements). The agreements provide that in the event of a change of control,
each key employee would have specific rights and receive certain benefits if,
within three years after a change in control, the employee is terminated without
cause or the employee terminates voluntarily under "constructive involuntary"
circumstances as defined in the agreement. In such circumstance the employee
will receive a severance payment equal to three times the employee's annual
average compensation calculated over the five years preceding such termination
as well as continued health, disability and life insurance for three years after
termination. The 1980 and 1991 Master Stock Compensation Plans, the
supplementary retirement agreements and deferred income arrangements also
provide for immediate vesting or payment in the event of termination under
circumstances of a change in control.
INDEPENDENT AUDITORS
Upon recommendation1997 STOCKHOLDER PROPOSALS
In order for stockholders' proposals for the 1997 annual meeting of its Audit Committee,stockholders
to be eligible for inclusion in the Board of Directors has
appointed Ernst & Young LLP as independent public accountantsCompany's Proxy Statement, they must be
received in writing by submission to audit the books and accountsSecretary of the Company for the fiscal year ending July 31,at its
principal office in Minneapolis, Minnesota no later than September 22, 1996 such appointmentand
not prior to continue at the pleasure of the Board of Directors and
subject to ratification by the shareholders. Ernst & Young LLP has audited
the books and accounts of the Company since 1951. Representatives of Ernst &
Young LLP are expected to be present at the meeting with the opportunity to
make a statement and to respond to appropriate questions. In the event this
appointment is not ratified, the Board will appoint other independent
auditors for the subsequent fiscal year.
The Board of Directors recommends that shareholders vote for ratification of
the appointment of Ernst & Young LLP as independent auditors for the fiscal
year ending July 31,August 22, 1996.
SHAREHOLDER PROPOSALS
The last day the Company will receive for its consideration any proposals
from shareholders for the 1996 Annual Meeting of Shareholders is June 18,
1996. Proposals should be sent to the attention of the Secretary.
OTHER MATTERS
The Company is not aware of any matter, other than as stated above, which will
or may properly be presented for action at the meeting. If any other matters
properly come before the meeting, it is the intention of the persons named in
the enclosed form of proxy to vote the shares represented by such proxies in
accordance with their best judgment.
By Order of the Board of Directors
Raymond F. Vodovnik/s/ Norman C. Linnell
Norman C. Linnell
Secretary
October 16, 1995
- --------------------------------------------------------------------------------
[LOGO]15, 1996
DONALDSON COMPANY, INC.
[LOGO] DONALDSON
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints William A. HodderG. Van Dyke and Raymond F. Vodovnik,Norman C. Linnell, and
each of them, as proxies, with full power to appoint a substitute, to vote all
shares the undersigned is entitled to vote at the Annual Meeting of Shareholders
of Donaldson Company, Inc. to be held on November 17, 1995,15, 1996, and all adjournments
thereof, to vote as designated on the matters referred to on the reverse side
hereof and, in their discretion, on any other matters properly coming before
said meeting. Dated: __________________, 1995
_______________________________
_______________________________, 1996 Signatures (Please sign as name(s) appear on this
proxy. If joint account, each joint owner should sign. When signing as attorney,
executor, administrator, trustee, guardian or corporate official, give your full
title as such.)
Dated: ______________________________, 1996
___________________________________________
___________________________________________
Signatures
(Please sign as name(s) appear on this
proxy. If joint account, each joint owner
should sign. When signing as attorney
attorney, executor, administrator, trustee
guardian or corporate official, give your
full title as such.)
(Continued from and to be signed on the reverse side)
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED BELOW. IF
NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR PROPOSALS 1 AND 2.
1. ELECTION OF DIRECTORS. Nominees: W.A. Hodder, K.B. Melrose,F.G. Bastiaens, J.M. Dolan, S.W. SangerRichey
[ ] VOTE FOR all nominees listed above; except vote withheld from
following nominees (if any):
[ ] WITHHOLD VOTE from all nominees.
2. RATIFY APPOINTMENT OF AUDITORS:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. IN THEIR DISCRETION upon other matters as may come before the meeting.
PLEASE MARK, SIGN, DATE AND RETURN THIS
PROXY PROMPTLY USING THE ENCLOSED ENVELOPE