SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
[X] Definitive Proxy Statement RULE 14C-5(D)(2))
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
DANAHER CORPORATION
------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
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Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-
6(i)(3).
[_] 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:
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pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
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[_] 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 Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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Notes:
DANAHER CORPORATION
1250 24TH STREET, N.W.
WASHINGTON, D.C. 20037
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 17, 199423, 1995
To the Shareholders:
Notice is hereby given that the 19941995 Annual Meeting of Shareholders of
Danaher Corporation, (the "Company"), a Delaware corporation (the "Company"), will be held at
the ANA Hotel, 2401 M Street, NW, Washington, D.C. 20037, on May 17, 199423, 1995 at
4:00 p.m., local time, for the following purposes:
1. To elect three Directorsone Director to hold office for a term of three years and until
their successors arehis successor is elected and qualified.
2. To approve the appointment of Arthur Andersen & Co.LLP as the Company's
independent auditors for the year ending December 31, 1994.1995.
3. To approve an amendmentthe performance goals for 1995 incentive compensation to the
1987 Stock Option Plan of the Company.Company's executive officers.
4. To approve the grant of an option to acquire shares of Company stock to
be made to Mr. George M. Sherman, President and Chief Executive
Officer.
5. To consider and act upon such other business as may properly come before
the meeting.
The Board of Directors has fixed the close of business on March 23, 199427, 1995 as
the record date for determination of shareholders entitled to notice of and to
vote at the meeting and any adjournment thereof.
Whether or not you expect to be present, please sign, date and return the
enclosed proxy card as promptly as possible in the enclosed stamped envelope,
the postage on which will be valid if mailed in the United States.
By Order of the Board of Directors
/s/ Patrick W. Allender
Patrick W. Allender
Secretary
March 30, 19941995
EVERY SHAREHOLDER'S VOTE IS IMPORTANT. PLEASE MARK, SIGN, DATE AND MAIL THE
ENCLOSED PROXY CARD AT YOUR EARLIEST CONVENIENCE, WHETHER OR NOT YOU PLAN TO
ATTEND THE DANAHER CORPORATION ANNUAL MEETING.
PROXY STATEMENT
DANAHER CORPORATION
1250 24TH STREET, N.W.
WASHINGTON, D.C. 20037
(202) 828-0850
19941995 ANNUAL MEETING OF SHAREHOLDERS
MAY 17, 199423, 1995
This Proxy Statement is furnished in connection with the solicitation by the
Board of Directors of Danaher Corporation, a Delaware corporation (the
"Company"), of proxies for use at the 19941995 Annual Meeting of Shareholders
("Annual Meeting") to be held at the ANA Hotel on May 17, 199423, 1995 at 4:00 p.m.,
local time, and at any and all adjournments thereof. The Company's principal
address is 1250 24th Street, N.W., Washington, D.C. 20037. The date of mailing
of this Proxy Statement is on or about March 30, 1994.1995. The purpose of the
meeting is to elect three directorsone director of the Company, to approve the appointment of
Arthur Andersen & Co.LLP as the Company's independent auditors for the current year,
to approve an amendmentthe performance goals for 1995 incentive compensation to the
1987 Stock Option Plan of the Company, to
approve the grant of an option to acquire shares of Company stock to be made to
Mr. George M. Sherman, President and Chief Executive Officer,Company's executive officers, and to transact such other business as may
properly come before the meeting.
OUTSTANDING STOCK AND VOTING RIGHTS
In accordance with the By-laws of the Company, the Board of Directors has
fixed the close of business on March 23, 199427, 1995 as the record date for
determining the shareholders entitled to notice of, and to vote at, the Annual
Meeting. Only shareholders of record on that date will be entitled to vote. A
shareholder who submits a proxy on the accompanying form has the power to
revoke it by notice of revocation directed to the proxy holders of the Company
at any time before it is voted. A subsequently dated proxy, when filed with the
Secretary of the Company, will constitute revocation. Proxies will be voted as
specified on the proxy card and, in the absence of specific instructions, will
be voted for the proposals described in this Proxy Statement and in the
discretion of the proxy holders on any other matter which properly comes before
the meeting. A shareholder who has given a proxy may nevertheless attend the
meeting, revoke the proxy and vote in person. The Board of Directors has
selected Steven M. Rales and Mitchell P. Rales to act as proxies with full
power of substitution.
Solicitation of proxies may be made by mail, personal interview, telephone
and telegraph by officers and other management employees of the Company, who
will receive no additional compensation for their services. The total expense
of the solicitation will be borne by the Company and may include reimbursement
paid to brokerage firms and others for their expenses in forwarding material
regarding the Annual Meeting to beneficial owners.
The only outstanding securities of the Company entitled to vote at the Annual
Meeting are shares of Common Stock. As of the close of business on March 23,
1994,27,
1995, the record date for determining the shareholders of the Company entitled
to vote at the Annual Meeting, 28,556,12758,438,288 shares of the Common Stock of the
Company, $.01 par value ("Company Common Stock"), were issued and outstanding.
Each outstanding share of Company Common Stock entitles the holder to one vote
on all matters brought before the Annual Meeting. The quorum necessary to
conduct business at the Annual Meeting consists of a majority of the
outstanding shares of Company Common Stock as of the record date.
The election of the directorsdirector nominated will require a plurality of the votes
cast in person or by proxy at the Annual Meeting by holders of shares of the
Company's Common Stock. In the election of directors, each stockholder is
entitled to cast one vote for each director to be elected; cumulative voting is
not permitted. Approval of the appointment of the Company's auditors will
require the affirmative vote of the holders of a majority of the shares of the
Company's Common Stock cast at the Annual Meeting in person or by proxy.
Approval of the amendmentperformance goals for 1995 incentive compensation to the
1987 Stock Option Plan and the approval of the grant of an
option to acquire shares of Company stock to be made to Mr. Sherman requireCompany's executive officers requires the affirmative vote of the holders of a
majority of the shares of common stock of
the CompanyCompany's Common Stock present, or represented,
and entitled to vote at the annual meeting.
Abstentions and "broker non-votes" are counted as present in determining
whether the quorum requirement is satisfied. Abstentions and "non-votes" are
treated as votes against proposals presented to stockholders other than
elections of directors. For purpose of the election of
directors, abstentions and broker non-votes are not considered to be votes cast
and do not affect the plurality vote required for elections of directors. For
purposes of the appointment of the Company's auditors, abstentions and broker
non-votes will not be considered votes cast for the foregoing purposes. For
purposes of approval of the amendmentperformance goals for 1995 incentive compensation
to the 1987 Stock Option Plan and the approval of the option grant to
Mr. Sherman,Company's executive officers abstentions are treated as present and
entitled to vote on the matter and have the effect of a vote against the
proposal and broker non-votes arewill not be considered entitled to be votes cast.vote and will
have no effect on the vote required for approval.
BENEFICIAL OWNERSHIP OF COMPANY COMMON STOCK BY
DIRECTORS, OFFICERS AND PRINCIPAL SHAREHOLDERS
As of March 23, 1994,27, 1995, the beneficial ownership of Company Common Stock by
directors and the nomineesnominee for directors,director, by each of the executive officers named
in the Summary Compensation Table, by any principal Shareholdersshareholders beneficially
owning more than five percent of the Company's Common Stock and by all present
executive officers and directors of the Company as a group, was as follows:
NUMBER OF SHARES PERCENT
NAME BENEFICIALLY OWNED OF CLASS
- ---- ------------------ --------
Mortimer M. Caplin............................... 53,937107,874 *
George M. Sherman................................ 600,000(4) 2.1%1,264,000(4) 2.2%
Donald J. Ehrlich................................ 10,00020,000 *
Walter G. Lohr, Jr............................... 37,00074,000 *
Mitchell P. Rales................................ 12,684,649(1) 44.4%25,169,298(1) 43.1%
Steven M. Rales.................................. 12,684,649(1) 44.4%
W. John Weinhardt................................ 24,000(5)25,169,298(1) 43.1%
James H. Ditkoff................................. 90,800(5) *
Patrick W. Allender.............................. 67,227(6)146,000(6) *
John P. Watson................................... 7,200(7)30,800(7) *
Dennis D. Claramunt.............................. 17,600(3) *
A. Emmet Stephenson, Jr.......................... 58,030(2)116,060(2) *
T. Rowe Price Associates, Inc. .................. 1,450,849(3) 5.1%
All executive officers and directors as a group
(includes 13 persons)........................... 13,564,043(1)27,100,432(1)(2) 47.5%46.4%
- --------
(1) The aggregate holdings for Steven and Mitchell Rales include all of the
10,013,78320,027,566 shares of Company Common Stock owned by Equity Group Holdings,
of which Steven M. Rales and Mitchell P. Rales are the general partners.
All of the shares owned by Equity Group Holdings are held with sole voting
and dispositive power. Their business address, and that of Equity Group
Holdings, is 1250 24th Street, N.W., Washington, D.C. 20037.
(2) Includes 34,03068,060 shares of Company Common Stock held in the names of
Stephenson Ventures, a limited partnership of which the sole general
partner is A. Emmet Stephenson, Jr., and 20,00040,000 shares held in the name of
Tessa Fund, a general partnership beneficially owned by trusts for the
benefit of the daughter of Mr. Stephenson, who is the general partner for
control purposes only. Bank One, Denver as Trustee owns 4,0008,000 shares in
individual retirement accounts for the benefit of A. Emmet Stephenson, Jr.
and his wife.
(3) T. Rowe Price Associates, Inc.'s address is: 100 E. Pratt Street,
Baltimore, Maryland 21202.
2
Mr. Claramunt has the option to acquire 17,600 shares of Company Common
Stock.
(4) Mr. Sherman has the option to acquire 500,0001,080,000 shares of common stock.Company Common
Stock.
(5) Mr. WeinhardtDitkoff has the option to acquire 24,00062,800 shares of common stock.Company Common Stock.
(6) Mr. Allender has the option to acquire 20,00052,000 shares of common stock.Company Common
Stock.
(7) Mr. Watson has the option to acquire 7,20030,800 shares of common stock.
* RepresentsCompany Common Stock.
*Represents less than 1% of the outstanding Company Common Stock.
2
Apart from Steven M. Rales and Mitchell P. Rales, and T. Rowe Price
Associates, Inc., the Company knows of no
other person that beneficially owns 5% or more of its Common Stock.
PROPOSAL 1.
ELECTION OF DIRECTORS OF THE COMPANY
The Company's Certificate of Incorporation provides that the Board of
Directors shall be divided into three classes with the number of directors in
each class to be as equal as possible. The Board has fixed the number of
directors of the Company at seven. At the 19941995 Annual Meeting of Shareholders,
shareholders will elect three directorsone director to serve until the 19971998 Annual Meeting of
Shareholders and until their successors arehis successor is duly elected and qualified. The Board
of Directors has nominated Mr. Steven M. Rales to serve as a director until his
term expires in 1998. Messrs. Mortimer M. Caplin, Donald J. Ehrlich and Walter
G. Lohr, Jr. will continue to serve as directors in the class whose term
expires in 1997. Messrs. Mitchell P. Rales, George M. Sherman and A. Emmet
Stephenson, Jr. will continue to serve as directors in the class with a term
expiring in 1996, and Mr. Steven M. Rales will continue to serve as a director with his
term expiring in 1995.1996.
The names of the nomineesnominee and the directors continuing in office, their
principal occupations, the years in which they became directors and the years
in which their terms expire are set forth below. In the event the nomineesnominee shall
decline or be unable to serve, it is intended that the proxies will be voted in
the discretion of the proxy holders. The Company knows of no reason to
anticipate that this will occur.
NOMINEESNOMINEE FOR ELECTION AT THIS YEAR'S ANNUAL MEETING
TO SERVE IN THE CLASS WHOSE TERM EXPIRES IN 19971998
DIRECTOR TERM
NAME AGE PRINCIPAL OCCUPATION SINCE EXPIRES
---- --- -------------------- -------- -------
Mortimer M. Caplin (a,c). 77 Senior Member of Caplin & 1990 1994
Drysdale, a law firm in
Washington, D.C., for over
five years; Director of
Fairchild Industries, Inc.,
Fairchild Corporation,
Presidential Realty
Corporation, and Unigene
Laboratories, Inc.
Donald J. Ehrlich (a,c) 56 President and Director of 1985 1994
Wabash National Corp. for
five years; Director of
Indiana Secondary Market for
Educational Loans, Inc. and
INB National Bank, N.W.
Walter G. Lohr, Jr. (a) 50 Partner of Hogan & Hartson, a 1983 1994
law firm in Baltimore,
Maryland, since 1992;
attorney in private practice
1987-1992.
(a) Member of the Compensation Committee of the Board of Directors.
(b) Mitchell Rales and Steven Rales are brothers.
(c) Member of the Audit Committee of the Board of Directors.
3
CURRENT DIRECTORS WHOSE TERM WILL
CONTINUE AFTER THIS MEETING
DIRECTOR TERM
NAME AGE PRINCIPAL OCCUPATION SINCE EXPIRES
---- --- -------------------- -------- -------
Steven M. Rales (b)...... 42..... 43 Chairman of the Board of the 1983 1995
Company since 1983 1998
1984; Chief Executive Officer of the
Company until Feb. 1990; General Partner
of Equity Group Holdings, a partnership
located in Washington, D.C. with interests
in publicly traded securities,
manufacturing companies and media
operations, since 1979; and Director of
Wabash National Corp.
CURRENT DIRECTORS WHOSE TERM WILL CONTINUE AFTER THIS MEETING
Mortimer M.Caplin (a,c). 78 Senior Member of Caplin & Drysdale, a law 1990 1997
firm in Washington, D.C., for over five
years; Director of Fairchild Industries,
Inc., Fairchild Corporation, and
Presidential Realty Corporation.
Donald J. Ehrlich (a,c). 57 President and Director of Wabash National 1985 1997
Corp. for five years; Director of Indiana
Secondary Market for Educational Loans,
Inc. and INB National Bank, N.W.
Walter G. Lohr, Jr. (a). 51 Partner of Hogan & Hartson, a law firm in 1983 1997
Baltimore, Maryland, since 1992; attorney
in private practice 1987-1992.
- --------
(a) Member of the Compensation Committee of the Board of Directors.
(b) Mitchell P. Rales and Steven M. Rales are brothers.
(c) Member of the Audit Committee of the Board of Directors.
3
CURRENT DIRECTORS WHOSE TERM WILL CONTINUE AFTER THIS MEETING
DIRECTOR TERM
NAME AGE PRINCIPAL OCCUPATION SINCE EXPIRES
---- --- -------------------- -------- -------
Mitchell P. Rales (b).... 37... 38 President of the Company from 1987 to 1983 1996
1987 to
February 1990; Executive Vice President of
the Company from January 1984 to March
1987; General Partner of Equity Group
Holdings, a general partnership located in
Washington, D.C. with interests in
publicly traded securities, manufacturingmanu-
facturing companies and media operations,
since 1979; Director of Wabash National
Corp.
From July 1, 1991 to
January 2, 1992, Mr. Rales
served as acting president
of CPC-Rexcel, Inc., a
manufacturer of plastic food
containers, following the
resignation of that
company's chief executive
officer, until the search
for a new chief executive
officer was completed. CPC-
Rexcel, Inc. filed a
voluntary petition under
Chapter 11 of the Federal
Bankruptcy Code in November
1992.
George M. Sherman........ 52Sherman....... 53 President and Chief Executive Officer of 1990 1996
Officer of
the Company since February 1990; Executive
Vice President and President of the Power
Tools and Home Improvement Group of The
Black & Decker Corporation from 1985 to
1990.
A. Emmet Stephenson, Jr.
(c). 48.................... 49 President of Stephenson and 1986 1996
Co., a private 1986 1996
investment management firm in Denver,
Colorado for more than five years; Senior
Partner of Stephenson Merchant Banking for
more than five years.
THE BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD
The Board of Directors had a total of four meetings during 1993.1994. All
directors attended at least 75% of the meetings of the Board of Directors and
of the Committees of the Board of Directors on which they served during 1993.1994.
The Executive Committee acts on behalf of the Board of Directors of the
Company between meetings of the Board of Directors. The Executive Committee
comprised of Messrs. George M. Sherman, Steven M. Rales and Mitchell P. Rales
met twothree times in 1993.1994.
The Audit Committee reviews the financial statements of the Company to
confirm that they reflect fairly the financial condition of the Company and to
appraise the soundness, adequacy and application of accounting and operating
controls. The Audit Committee recommends independent auditors to the Board of
Directors, reviews the scope of the audit function of the independent auditors
and reviews audit reports rendered by the independent auditors. The Audit
Committee met two times during 1993.
4
1994.
The Compensation Committee reviews the Company's Compensation philosophy and
programs, and exercises authority with respect to the payment of direct
salaries and incentive compensation to Company officers. The Compensation
Committee is also responsible for the oversight of the stock option plans of
the Company. The Compensation committee met two times in 1993.1994.
The Company has no Nominating Committee of its Board of Directors.
4
EXECUTIVE OFFICERS OF THE REGISTRANT
Executive Officers of the Company are:
OFFICER
NAME AGE POSITION SINCE
---- --- -------- -------
Steven M. Rales..... 42Rales......... 43 Chairman of the Board 1984
Mitchell P. Rales... 37Rales....... 38 Chairman of the Executive Committee 1984
George M. Sherman... 52 Chief Executive Officer, President and
George M. Sherman....... 53 Director 1990
Director
Patrick W. Allender. 47Allender..... 48 Senior Vice President, Chief Financial 1987
Officer and Secretary
James H. Ditkoff.... 48Ditkoff........ 49 Vice President-Finance/Tax 1991
W. John Weinhardt... 43Dennis D. Claramunt..... 49 Vice President and Group Executive 1991
C. Scott Brannan.... 351994
Vice President Administration and
C. Scott Brannan........ 36 Controller 1987
John P. Watson...... 49Watson.......... 50 Vice President and Group Executive 1993
Steven M. Rales has served as Chairman of the Board since January 1984. He
has been a General Partner, since 1979, in Equity Group Holdings, a general
partnership located in Washington, D.C. with interests in media operations,
publicly traded securities and manufacturing companies.
Mitchell P. Rales has served as a director of the Company since January 1984,
President from March 1987 to January 1990 and Executive Vice President from
January 1984 to March 1987. He has been a General Partner of Equity Group
Holdings since 1979.
From July 1, 1991 to January 2, 1992, Mr. Rales served as
acting president of CPC-Rexcel, Inc., a manufacturer of plastic food
containers, following the resignation of that company's chief executive
officer and until the search for a new chief executive officer was completed.
CPC-Rexcel, Inc. filed a voluntary petition under Chapter 11 of the Federal
Bankruptcy Code in November 1992.
George M. Sherman has served as President and Chief Executive Officer and a
director of the Company since February 1990. He served as a corporate Executive
Vice President and President of the Power Tools and Home Improvement Group at
The Black and Decker Corporation from 1985 to 1990.
Patrick W. Allender has served as Chief Financial Officer of the Company
since March, 1987.
James H. Ditkoff was appointed Vice President-Finance/Tax in January, 1991.
He has served in an executive capacity in finance/tax for the Company since
September, 1988.
He was Vice President, Taxes for Pepsico, Inc. prior thereto.
W. John WeinhardtDennis D. Claramunt was appointed Vice President and Group Executive in January, 1991. Prior to joining1994.
He has served as President of Jacobs Chuck Manufacturing Company for more than
the Company in November, 1990, he held various
management positions with Prestolite Wire Corporation and Bendix/Allied Signal
Corporation, including most recently President and CEO of Prestolite Wire
Corporation.past five years.
C. Scott Brannan was appointed Vice President-Administration and Controller
of the Company in November, 1987.
John P. Watson was appointed Vice President and Group Executive in 1993. He
has served the Company in an executive capacity in its Tool Group since
September, 1990. He was Executive Vice President for the Sterling Group, a
division of the Kohler Company, prior thereto.
5
COMPENSATION OF DIRECTORS
AND EXECUTIVE OFFICERS
The following table sets forth certain information concerning the
compensation for the last three completed fiscal years of the Chief Executive
Officer and the five executive officers of the Company who, in addition to the
Chief Executive Officer, received the highest compensation during 1993.1994.
SUMMARY COMPENSATION TABLE
LONG TERM
ANNUAL COMPENSATION COMPENSATION
- --------------------------------------------------------------------------------------------------------------- ---------------------
AWARDS
---------------------
(E)
OTHER (F) (G) (H)
(A) ANNUAL RESTRICTED SECURITIES ALL OTHER
NAME AND (C) (D) COMPEN- STOCK UNDER-UNDERLYING COMPEN-
PRINCIPAL (B) SALARY BONUS SATION(1) AWARDS(2) LYING SATION(3)OPTION(3) SATION(4)
POSITION YEAR ($) ($) ($) ($) OPTION (#) ($)
--------- ---- ------- ------- --------- ---------- ---------- ---------
George M. Sherman......Sherman....... 1994 675,000 921,000 -- -- -- 30,000
President and CEO 1993 675,000 800,000 -- -- 200,000 $34,000
President and CEO400,000 34,000
1992 675,000 540,000 1,027,998 -- -- 27,000
1991 675,000 145,800W. John Weinhardt(5).... 1994 200,000 152,000 -- -- -- 24,000
Steven M. Rales........ 1993 295,000 -- -- -- -- 19,000
Chairman of the Board 1992 295,000 -- -- -- -- 19,000
1991 295,000 -- -- -- -- 18,000
Mitchell P. Rales...... 1993 295,000 -- -- -- -- 19,000
Chairman, 1992 295,000 -- -- -- -- 19,000
Executive Committee 1991 295,000 -- -- -- -- 18,000
W. John Weinhardt......14,000
Vice President and Group 1993 187,500 234,000 -- -- 15,00030,000 19,000
Vice President andExecutive 1992 176,666 135,200 -- -- -- 19,000
Group Executive 1991 175,000 105,000Patrick W. Allender..... 1994 205,000 254,000 -- -- -- 1,000
Patrick W. Allender....40,000 14,000
Senior Vice President 1993 176,666 180,000 -- -- 30,00060,000 19,000
Senior Vice Presidentand CFO 1992 157,500 124,000 -- -- 20,00040,000 19,000
and CFO 1991 140,833 31,300 --John P. Watson.......... 1994 196,000 196,000 -- -- 18,000 John P. Watson.........14,000
Vice President and Group 1993 180,666 150,000 -- -- 25,00050,000 19,000
Vice President andExecutive 1992 164,333 100,000 -- -- 6,00012,000 19,000
Group Executive 1991 153,500James H. Ditkoff........ 1994 181,150 175,000 -- -- 6,000 14,000
Vice President-Finance & 1993 173,583 115,000 -- -- 18,00010,000 19,000
Tax 1992 165,667 85,000 -- -- 12,000 19,000
Dennis D. Claramunt..... 1994 184,000 120,000 -- -- 10,000 14,000
Vice President and Group 1993 167,000 118,000 -- -- 40,000 19,000
Executive 1992 156,000 110,000 -- -- 8,000 19,000
- --------
(1) Represents tax gross-up payments on restricted stock grantgrant.
(2) Mr. Sherman received a grant of 200,000400,000 shares in 1990; 100,0001990 (giving effect to
the two-for-one stock split on January 20, 1995); 200,000 are currently
vested and 100,000200,000 vest in August, 1996. Vested shares participate in
dividends ($12,00013,000 in 1994 and $12,000 in 1993, none prior thereto) on a
non-
preferentialnon-preferential basis. The value of the 200,000400,000 shares at December 31,
19931994 was $7,625,000.$10,450,000.
(3) Numbers of shares reflect the two-for-one stock split on January 20, 1995.
(4) Includes contributions to the Company's 401(k) plan for all individuals; in
the case of Mr. Sherman, it also includes supplemental term life insurance
($6,000)8,000) and financial consulting fees ($9,000)8,000).
(5) Mr. Weinhardt's employment terminated with the Company on December 7, 1994.
6
OPTION
GRANTS IN LAST FISCAL YEAR
The following table sets forth certain information relating to options
granted to purchase shares of the Company Common Stock.
POTENTIAL REALIZABLE VALUE AT
ASSUMED ANNUAL RATES OF
STOCK PRICE APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERM (3)
- --------------------------------------------------------------------------------------------------------------------------------------------------- -------------------------------
(A) (B) (C) (D) (E) (F) (G) (H)
NO. OF SECURITIES % OF TOTAL
UNDERLYING OPTIONS EXERCISE
OPTIONS/SARS GRANTED TO OR BASE
GRANTED EMPLOYEES IN PRICE EXPIRATION
NAME (#) (1) FISCAL YEAR ($/SH)(2) DATE 0%($) 5%($) 10%($)
---- ----------------------------- ------------ --------- ---------- ------------------- ----------------------------- ------------
George Sherman (4)...... 200,000 37.3% $27.00 4/8/03 $ 0 3,396,003 8,606,191
W. John Weinhardt....... 15,000 2.8% $36.50 12/7/03 $ 0 891,817 1,967,572
Patrick W. Allender..... 30,000 5.6% $36.5040,000 8.8% $23.50 12/7/03 $ 0 1,783,634 3,935,1446/04 $0 591,156 1,498,115
Dennis D. Claramunt..... 10,000 2.2% $23.50 12/6/04 $0 147,789 374,529
James H. Ditkoff........ 6,000 1.3% $23.50 12/6/04 $0 88,673 224,717
John P. Watson.......... 20,000 3.7% $29.88 5/18/03 $ 0 973,424 1,550,019
John P. Watson.......... 5,000 0.9% $36.5018,000 3.9% $23.50 12/7/03 $ 0 297,272 655,8576/04 $0 266,020 674,152
- --------
(1) Options become exercisable ratably beginning one year from date of grant
through five years from date of grant. Number of shares reflect the two-
for-one stock split on January 20, 1995.
(2) Options were granted at fair market value on the date of grant.
(3) The dollar amounts set forth under these columns are the result of
calculations of assumed annual rates of stock price appreciation from the
date of the grant to the date of expiration of such options of 0%, 5%, and
10%. These assumptions are not intended to forecast future price
appreciation of the Company's stock price. The Company's stock price may
increase or decrease in value over the time period set forth above.
(4) Options are subject to shareholders' approval.AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION VALUES
The following table sets forth certain information concerning the number of
unexercised options and the value of unexercised options at the end of 19931994 for
the executive officers whose compensation is reported in the Summary
Compensation Table. The number of shares subject to the options set forth in
the table reflect the two-for-one stock split on January 20, 1995. Value is
considered to be, in the case of unexercised options, the difference between
the exercise price and the market price at December 31, 1993. No stock options were exercised by any of the executive
officers named in the Summary Compensation Table during 1993.1994.
VALUE OF UNEXERCISED
NUMBER OF SECURITIES VALUE OF UNEXERCISEDIN-THE-
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONSMONEY OPTIONS AT
FY-END(#)SHARES OPTION AT FY-END($FY-END (#) FY-END ($)
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE (#) REALIZED ($) UNEXERCISABLE UNEXERCISABLE
---- ------------ ------------ ---------------------- ------------------------------------------
George M. Sherman................. 500,000/200,000(1) $12,687,500/$2,225,000Sherman....... -- -- 1,080,000/320,000 20,760,000/4,040,000
James H. Ditkoff........ 24,000 348,500 62,800/ 24,200 1,157,600/ 249,525
Patrick W. Allender..... -- -- 52,000/118,000 792,500/ 978,750
John P. Watson.......... -- -- 30,800/ 69,200 464,350/ 654,400
Dennis D. Claramunt..... -- -- 17,600/ 48,400 258,500/ 490,750
W. John Weinhardt................. 24,000/ 31,000 570,000/ 404,375
Patrick W. Allender............... 13,000/ 52,000 275,625/ 472,500
John P. Watson.................... 7,200/ 33,800 148,350/ 195,525Weinhardt....... -- -- 70,000/ -0- 1,263,250/ -0-
- --------
(1) Subject to Shareholders Approval.
7
COMPENSATION OF DIRECTORS
Directors who are not officers of the Company receive meeting attendance fees
of $750 per meeting (excluding telephonic meetings), together with quarterly
fees of $3,000. In 1994, a grant of options to acquire 2,000 shares of Company
Common Stock at $22.25 (fair market value at date of grant) per share was made
to these directors.
7
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT
Pursuant to the terms of termination agreements between the Company and
Messrs. Sherman Watson and Weinhardt,Watson, if the Company were to terminate their employment
without cause, as defined therein, Mr. Sherman's salary and benefits would
continue for an additional 24 months, and Messrs. Watson and
Weinhardt'sMr. Watson's salary and benefits
would continue for an additional 12 months. See "Report of Thethe Compensation
Committee of the Board of Directors on Executive Compensation" for further
discussion of Mr. Sherman's contract.
BOARDCOMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
CONCERNING EXECUTIVE OFFICER COMPENSATION
Messrs. Steven M. Rales, Mitchell P. Rales and George M. Sherman receive a
salary set by the Compensation Committee of the Board of Directors and also
serve as directors, however,directors. However, they do not participate in deliberations regarding
their own compensation. Messrs. Steven M. Rales and Mitchell P. Rales also
serve as directors and participate in deliberations concerning executive
officer compensation at Wabash National Corp., of which Donald J. Ehrlich, a
director of the Company, serves as President. The members of the Compensation
Committee are Walter G. Lohr, Jr., Mortimer M. Caplin and Donald J. Ehrlich.
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS ON EXECUTIVE
COMPENSATION
The report is not deemed to be "soliciting material" or to be "filed" with
the Securities and Exchange Commission (the "SEC") or subject to the SEC's
proxy rules or to the liabilities of Section 18 of the Securities Exchange Act
of the 1934 (the "1934 Act"), and the report shall not be deemed to be
incorporated by reference into any prior or subsequent filing by the
Corporation under the Securities Act of 1933 or the 1934 Act.Securities Exchange Act of
1934.
Total executive officer compensation is comprised of three principal
components: annual salary, annual incentive compensation, and grants of options
to purchase Company stock. In the case of Mr. Sherman, this included a
restricted stock grant at the time of his hire. The BoardCommittee endeavors to
establish total compensation packages for each executive officer equal to the
value of that executive's services determined by both what other companies have
or might pay the executive for his services and thishis relationship to other
executive positions within the Company, as negotiated at the date of hire. This
base is then adjusted annually based on the Board'sCommittee's assessment of
individual performance. To date, the Board has been satisfied in assessing
these values without the assistance of outside consulting services.
A fundamental element of the Company's compensation policy is that a
substantial portion of each executive's compensation be directly related to the
success of the Company. This is accomplished in two ways. First, the annual
incentive compensation program requires that the Company, or the Company's
businesses for which the executive is directly responsible, achieve certain
minimum targets in earnings level (earnings per share which has a majority
weighting) and working capital management (working capital turnover, which has
a minority weighting). If performance for the year is below minimum targeted
levels (generally approximately three-quarters of the earnings target must be
achieved and working capital management must exceed target levels) there would
be no payment. If the minimum targets are met or exceeded, each executive
receives a formula-based payout taking into account the Company's performance
and his or her personal contribution thereto.
8
Secondly,Second, executives and other key employees who, in the opinion of the
Committee, contribute to the growth, development and financial success of the
Company are eligible to be awarded options to purchase Company stock.Common Stock.
These grants are normally made at the fair market value on the date of grant
with vesting over a five year period. In addition to the factors discussed
above, the amount of options granted is impacted both by the level of the
employee within the Company's management and the amount of options
8
previously granted to the employee. Thereby,Thus the compensation value of this element
is directly related to the performance of the Company as measured by its
returns to stockholdersshareholders over at least a five year period.
Mr. Sherman's compensation is governed by a written contract dated January 2,
1990, whereby he agreed to serve as President and Chief Executive Officer. The
contract provides for Mr. Sherman to be paid a base salary of $675,000 per year
and an annual formula-based incentive compensation award, if earned, as
determined by the Compensation Committee. He also received 200,000 shares of
restricted stock (see Summary Compensation Table) and an option to acquire
500,000 shares (see Year End Option Value Table) of the Company stock, and has
received, or will receive, tax gross-up payments related to these items. In
addition, Mr. Sherman's contract requires the Company to provide supplemental
term life insurance and financial consulting services to him (see Summary
Compensation Table) and to provide severance benefits discussed previously.
The Compensation Committee had two deliberations concerning Mr. Sherman's
1993 Compensation during which the members considered a grant of additional
options to acquire Company shares under the Company's 1987 Employee Stock
Option Plan. The Committee discussed Mr. Sherman's contribution to the
development, growth, and financial success of the Company as well as the
Company's preference for performance based compensation. The Committee and subsequently the
Board of Directors recommended, and Mr. Sherman agreed, that his base salary,
which has not increased since he joined the Company, would not be increased
during the remainder of the term of his contract. Therefore, during the
remaining term of his contract with the Company, any increases in Mr. Sherman's
compensation will be tied directly to the financial performance of the Company
and the Company's stock price. In that regard, the BoardHe also received 400,000 shares of Directors granted to Mr. Sherman optionsrestricted
stock (see Summary Compensation Table) and an option to acquire 200,0001,000,000
shares (see Year End Option Value Table) of the Company stock, at an option price equaland has
received, or will receive, tax gross-up payments related to these items. The
number of shares of restricted stock and the fair market value asnumber of the
effective date of the grant,shares subject to
ratification ofoptions reflects the two-for-one stock split on January 20, 1995. In addition,
Mr. Sherman's contract requires the Company to provide supplemental term life
insurance and financial consulting services to him (see Summary Compensation
CommitteeTable) and approval by the shareholders at the 1994 annual meeting.to provide severance benefits discussed previously.
The Committee also evaluated Mr. Sherman'seach executive's annual incentive compensation awardawards
for 1993.1994. The Committee assessed Mr. Sherman'stheir performance in light of the targets
referenced above, which were substantially exceeded, and awarded Mr. Sherman antotal
incentive compensation paymentpayments of $800,000$1.8 million for 1993.1994. For 1994,1995, the
Committee has established a maximum bonus payment of up to $1,000,000 based on achievement$1.5 million per
executive, subject to approval by the Company's shareholders of the above described
criteria.performance
goals, which are applicable to all of the Company's executive officers, other
than Group Executives.
The Committee has considered the impact of newly enacted provisions of the
federal income tax laws that in certain circumstances disallow compensation
deductions in excess of $1 million for any year with respect to the executive
officers named in proxy statements of publicly traded companies. The Securities
and Exchange Commission requires compensation committees of public companies to
state their compensation policies relative to this $1 million deduction limit.
With respect to the Company's Chief Executive Officer, a portion of his
compensation is determined pursuant to a binding contract dated January 2, 1990
and, accordingly, is not subject to the deduction limit. In addition, the
Committee has determinedredesigned the program for awarding 1995 incentive compensation
to executive officers other than Group Executives so that the provisions of the Company's 1987 Stock Option
Plan as proposed to be amended by Proposal 3 should enable the Company tosuch bonuses will
comply to the extent deemed desirable, with an exception to the $1 million deduction limit for performance-based compensation with respect to awards madeperformance-
based compensation. Accordingly, the full amount of any such bonus payments for
1995 should be deductible. One of the requirements of this exception is that
shareholders approve certain material terms under that plan. The Committee also believes thatwhich the 1994 bonus awardis to be
paid topaid. In this regard, the Company's Chief Executive Officer will not exceedshareholders are being asked to approve the
$1 million
deduction limit and accordingly should be fully deductible bymaterial terms used for calculating the Company.
The Committee does not anticipate that1995 bonus awards for the compensation of the other namedCompany's
executive officers will be affected by the deductibility limit referred to
above.other than Group Executives, as discussed in Proposal 3
hereto.
The Company does not maintain a long-term incentive plan. The Company has not
repriced any options or stock appreciation rights during the last ten years.
9
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
Walter G. Lohr, Jr.
Mortimer M. Caplin
Donald J. Ehrlich
9
STOCK PERFORMANCE CHART
As part of proxy statement disclosure requirements mandated by the Securities
and Exchange Commission, the Company is required to provide a five-year
comparison of the cumulative total shareholder return on its Common Stock with
that of a broad equity market index and either a published industry index or a
Company constructed peer group index. This graph is not deemed to be
"soliciting material" or to be "filed" with the SEC or subject to the SEC's
proxy rules or to the liabilities of Section 18 of the 1934 Act, and the graph
shall not be deemed to be incorporated by reference into any prior or
subsequent filing by the Corporation under the Securities Act of 1933 or the
1934 Act.
The following chart compares the yearly percentage change in the cumulative
total shareholder return in the Company's Common Stock during the five years
ended December 31, 19931994 with the cumulative total return on the S&P 500 Index
(the equity index) and the Wilshire 5000S&P Manufacturing Index (the peer index). The
comparison assumes $100 was invested on December 31, 19881989 in the Company's
Common Stock and in each of the above indices with reinvestment of dividends.
[INSERT CHART][CHART APPEARS HERE]
COMPARISON OF FIVE YEAR CUMULATIVE RETURN
AMONG DHR, S&P 500 INDEX AND S&P MANUAL INDEX
Measurement period S&P
(Fiscal Year Covered) DHR S&P 500 MANU
- --------------------- -------- -------- --------
Measurement PT -
12/31/89 $ 100 $ 100 $ 100
FYE 12/31/90 $ 104.92 $ 96.9 $ 99.13
FYE 12/31/91 $ 132.79 $ 126.42 $ 121.51
FYE 12/31/92 $ 170.49 $ 136.05 $ 131.7
FYE 12/31/93 $ 250.59 $ 149.76 $ 159.89
FYE 12/31/94 $ 344.22 $ 151.74 $ 165.5
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company, from time to time, has been involved in transactions with Equity
Group Holdings and its affiliates. The Company has received legal services from
the firm of Caplin & Drysdale, of which Mr. Caplin, a Director, is a principal.member.
The amount of such fees for 19931994 was less than five-percent of such firm's
gross revenues. These transactions, which are conducted on an arms length basis
are not material, either individually or in the aggregate.
10
PROPOSAL 2.
APPROVAL OF APPOINTMENT OF AUDITORS
The Board of Directors has appointed Arthur Andersen & Co., a nationalLLP, an international
accounting firm of independent certified public accountants, to act as
independent accountants for the Company and its consolidated subsidiaries for
1994.1995. Arthur Andersen & Co.LLP has been the Company's auditors since 1976 and has
advised the Company that the firm does not have any direct or indirect
financial interest in the Company or any of its subsidiaries, nor has such firm
had any such interest in connection with the Company during the past five years
other than its capacity as the Company's independent certified public
accountants. A representative of Arthur Andersen & Co.LLP is expected to be present
at the Annual Meeting and will have an opportunity to make a statement if he
desires to do so and to be available to answer questions from shareholders.
The Board of Directors of the Company unanimously recommends that
shareholders vote FOR ratification and approval for the selection of Arthur
Andersen & Co.LLP to serve as independent auditors for the Company for 1994.1995.
PROPOSAL 3.
AMENDMENT TO THE 1987 STOCK OPTION PLAN
The Company's 1987 Stock Option Plan (the "Plan") wasAPPROVAL OF PERFORMANCE GOALS FOR 1995 BONUS
Beginning in 1994, federal income tax laws limit deductions for publicly held
corporations with respect to compensation in excess of $1 million paid to an
executive officer who is named in its proxy statement. However, compensation
payable solely on account of attainment of one or more performance goals is not
subject to the deduction limit if the performance goals are objective, pre-
established and determined by a compensation committee comprised solely of two
or more outside directors, the material terms under which the compensation is
paid are disclosed to shareholders and approved by shareholders ata majority vote, and the
1987 Annual Meeting. An amendmentcompensation committee certifies that the performance goals and other material
terms were in fact satisfied before amounts were paid.
In order to ensure that the full amount of the bonus payment that may be made
to the Plan increasingexecutive officers other then Group Executives for 1995 is deductible
for federal income tax purposes, the numbermaterial terms of shares available for award from 1,300,000the performance goals
under which that bonus is to 1,800,000be paid are described below and limiting the total numbershareholders
will be asked to approve those material terms. Payment of option shares awardedthe 1995 bonus based
on these performance goals is conditioned upon and subject to approval by the
shareholders of the Company of the material terms of these performance goals.
The maximum bonus payable to any individualexecutive officer other than Group
Executives will be determined under the
Plana formula and will not exceed $1.5 million.
The maximum bonus payable to 500,000 shares waseach executive officer other than Group Executives
for 1995 is computed under a formula approved by the Board of Directors, subject to
shareholder approval. The text of the proposed amendmentCompensation Committee on
March 9, 1995, that is set forth as
Exhibit A to this Proxy Statement.
PURPOSE OF THE PLAN
The Purpose of this Plan is to increase the ownership of the Company Common
Stock by those key employees who contribute to the continued growth,
development and financial success of the Company and its subsidiaries, and to
attract and retain such employees and reward them forbased on the Company's performance.reported 1995 earnings per share
from continuing operations. The Plan permits grants of non-qualified stock options and stock
appreciation rights.
NUMBER OF SHARES
The Plan as amended, provides that 1,800,000 share of Common Stock ofCompensation Committee reserves the Company will be available for awards to key employees in the form of non-
qualified stock options and stock appreciation rights, subject to adjustment
to reflect certain subsequent events relating to Common Stock such as stock
dividends, stock splits and share exchanges. The shares of Company Common
Stock utilized in connection with the Plan may be either authorized but
unissued shares or shares acquired and held in the treasury of the Company. No
more than 500,000 shares may be issued to any individual with respect to
awards made under the Plan.
ADMINISTRATIVE; ELIGIBILITY
The selection and the extent of participants in the Plan will be determined
by the Board of Directors, which may delegate its authority to a committee
(the "Committee") consisting of at least two members of the Board of Directors
who are not eligible for awards. Key employees of the Company and its
subsidiaries who, in the opinion of the Committee, contribute to the growth,
development and financial success of the Company or its subsidiaries are
eligible for awards. In determining the size of awards, the Committee will
take into account a participant's responsibility level, performance,
potential, cash compensation level and the fair market value of the Company
Common Stock at the time of the award as well as such other considerations as
it deems appropriate. The Board of Directors estimates that approximately 100
persons are eligible to receive awards under the Plan.
DURATION; EFFECTIVE DATE
The Plan has been effective since October 20, 1987, and options may be
granted under the Plan until October 20, 1997.
11
NON-QUALIFIED STOCK OPTIONS
The Board of Directors or the Committee may grant a participant options which
are non-qualified under the Internal Revenue Code of 1986. The timing and size
of options awarded will be subject to guidelines adopted by the Committee,
which may in its discretion provide that an option may not be exercised in
whole or in part for any period or periods. Options may be reacquired in the
discretion of the Board of Directors or the Committee for cash.
STOCK APPRECIATION RIGHTS
In the discretion of the Board of Directors or the Committee, any or all
optionees may be given the right, at any time during the option period, to
surrender all or part of their options and to receive from the Company a
payment equal to the appreciation that they would have realized on shares of
stock had the related options been exercised and the option stock sold.
The amount payable by the Company upon exercise of a stock appreciation right
may be paid either in cash, in Common Stock of the Company or in a combination
thereof, as the Board of Directors of the Committee in
its sole and absolute discretion, shall determine. However, the total number of shares which may be received
pursuantnot to a stock appreciation right may not exceed the total number of
shares subjectaward any bonus to the related option. Sharesexecutive
officers other than Group Executives for 1995 or to whichaward any of them a stock appreciation
right is related shall be used not more than once to calculate the amounts to
be received pursuant to an exercisebonus
of such right. The Board of Directors or
the Committee, may, in its sole discretion prohibit or limit the exercise of
stock appreciation rights for a period or periods as to determines to be in the
best interest of the Company and its stockholders.
STOCK OPTION AGREEMENTS
Non-qualified stock options will be evidenced by agreements approved by the
Board of Directors or the Committee, and a stock appreciation right will be
evidenced by an agreement incorporated in or amending the stock option
agreement to which the stock appreciation right relates. These agreements will
contain terms and conditions relating to medium of payment, number of shares,
option price (which will not be less than 85% of the fair market value of the
shares subject to the option on the date of grant), date of exercise,
repurchases, exercisemaximum amount determined in the event a participant ceases employmentaccordance with the Company, and other provisions that the Committee deems advisable.
SUBSTITUTE AWARDS
Non-qualified stock options and stock appreciation rights may be granted
under the Plan in substitution for similar awards held by employees of the
corporations who become or are about to become key employees of the Company as
a result of a merger, acquisition of assets or stock, consolidation or
reorganization. The terms and conditions of the substitute awards may vary from
the terms and conditions of the Plan to such extent as the Committee at the
time of the grant may deem appropriate in order to conform, in whole or in
part, to provisions of awards in substitution for which they are granted.
However, no variation which materially extends the period for granting awards,
or materially modifies the requirements as to eligibility can be effected
without shareholder approval.
EFFECT OF MERGER OR ACQUISITION
If the Company is the surviving or resulting corporation in any merger,
acquisition of assets or stock, consolidation or reorganization, rights granted
under the Plan shall survive, and the Board of Directors shall make any
necessary determinations and adjustments to preserve the rights and benefits of
participants. If the Company is not the surviving or resulting corporation in
any such transaction, the successor corporation may, but shall not be required
to, assume the rights and obligations of the Company under the Plan.
AMENDMENT OF PLAN
The Board of Directors may at any time and from any time alter, amend,
suspend, or discontinue the Plan, except no such action may be taken without
stockholder approval which materially increase the benefits to participants
under the Plan, materially increases the number of shares to be issued,
materially extends the period for granting awards, or materially modifies the
requirements as to eligibility. In addition, no such action may be taken which
adversely affects the rights of a participant under the Plan without his
consent.
12
FEDERAL INCOME TAX CONSEQUENCES
Under current law, there will be no federal income tax consequences to either
the optionee or the Company upon the grant of a non-qualified stock option. An
option holder who exercises a non-qualified stock option will generally realize
compensation taxable as ordinary income in an amount equal to the difference
between the option price and the fair market value of the shares on the date of
the exercise. The option holder's basis in such shares will be their fair
market value on the date of exercise, and when he disposes of the shares he
will generally recognize capital gain or loss, either long-term or short-term,
depending on the holding period of the shares.
The grant of a stock appreciation right will not result in taxable income to
the option holder or a deduction to the Company. An option holder who exercises
a stock appreciation right will realize compensation taxable as ordinary income
in an amount equal to the cash or the fair market value of the shares received
on the date of exercise. The option holder's basis in any share received will
be equal to the amount of compensation income recognized with respect to the
exercise, and when he disposes of the shares he will generally recognize
capital gain or loss, either long-term or short-term, depending on the holding
period of the shares.
Generally, the Company is entitled to a deduction in the amount of the income
recognized by the option holder at the time an option or stock appreciation
right is exercised. Beginning in 1994, the Company's deductions for an
executive officer named in the proxy statement may be limited to the extent
compensation paid to such officer for any year exceeds $1 million. However, an
exception to this limit is provided with respect to options and stock
appreciation rights granted at fair market value under a plan that is approved
by shareholders and administered by outside directors who satisfy certain
conditions imposed by proposed regulations issued by the Internal Revenue
Service, provided the plan limits the maximum number of shares that may be
issued to any individual. If the Company's shareholders approve the proposed
amendment of the Plan, it is expected that the requirements of this exception
will be satisfied for options and stock appreciation rights granted at fair
market value under the Plan.
The Internal Revenue Service has ruled that an employee who allows a stock
appreciation right to expire, other than as a result of exercising the related
option, will have taxable income in the year of expiration equal to the amount
of cash or the fair value of stock which he would have received if he had
exercised his stock appreciation right.formula
described above.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS APPROVE THE AMENDMENTMATERIAL
TERMS OF THE PERFORMANCE GOALS ESTABLISHED FOR THE PAYMENT OF BONUSES TO THE
1987 STOCK OPTION PLAN. APPROVAL REQUIRES THE AFFIRMATIVE VOTE OF THE
HOLDERS OF A MAJORITY OF THE SHARES OF COMMON STOCK OF THE COMPANY PRESENT, OR
REPRESENTED, AND ENTITLED TO VOTE AT THE ANNUAL MEETING.
PROPOSAL 4.
APPROVAL OF OPTION GRANT TO PRESIDENT
AND CHIEF EXECUTIVE OFFICER
By Unanimous Written Consent dated as of April 8, 1993, the Board of
Directors of the Company granted 200,000 non-qualified stock options to George
M. Sherman under the Company's 1987 Stock Option Plan at fair market value at
the close of business on that date ($27.00 per share), subject to approval of
the Compensation Committee of the Board of Directors and by a vote of a
majority of the Company's shareholders. The Compensation Committee approved
this grant (see Report of Compensation Committee) on December 7, 1993.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS APPROVE THE OPTION
GRANT TO THE PRESIDENT AND CHIEF EXECUTIVE OFFICER.OFFICERS OTHER THAN GROUP EXECUTIVES. APPROVAL REQUIRES THE
AFFIRMATIVE VOTE OF A MAJORITY OF THE SHARESHOLDERS OF COMMON STOCK OF THE COMPANY
PRESENT, OR REPRESENTED, AND ENTITLED TO VOTEVOTED AT THE
ANNUAL MEETING.
13MEETING ON THIS PROPOSAL.
11
OTHER MATTERS
The management of the Company is not aware of any other business that may
come before the meeting. However, if additional matters properly come before
the meeting, proxies will be voted at the discretion of the proxy holders.
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the 19951996 Annual Meeting of
Shareholders of the Company must be received by the Company at its principal
executive offices, Danaher Corporation, 1250 24th Street, N.W., Washington,
D.C. 20037, no later than November 27, 19941995 for inclusion in the Proxy
Statement and Proxy relating to the 19951996 Annual Meeting of Shareholders.
By Order of the Board of Directors
/s/ Patrick W. Allender
Patrick W. Allender
Secretary
Dated: March 30, 19941995
COPIES OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED
DECEMBER 31, 19931994 MAY BE OBTAINED, WITHOUT CHARGE, BY WRITING TO THE COMPANY.
14
EXHIBIT A
AMENDMENT TO DANAHER CORPORATION
1987 STOCK OPTION PLAN
Resolved that, as recommended and declared advisable by the Board of
Directors, the Company's 1987 Stock Option Plan be amended by striking out
SECTION FIVE in its entirety and substituting in lieu thereof the following:
SECTION FIVE. GRANT OF AWARDS AND LIMITATION
OF NUMBER OF SHARES OF STOCK AWARDED.
The Board or the Committee may, from time to time, grant Awards of Stock to
one or more Eligible Employees; provided that (i) subject to any adjustment
pursuant to Section Eleven or Twelve, the aggregate number of shares of Stock
subject to awards under this Plan may not exceed 1,800,000 shares; (ii) to the
extent that an Award lapses or the rights of the Participant to whom it was
granted terminate, any shares of Stock subject to such Awards shall again be
available for the grant of an award hereunder; and (iii) shares ceasing to be
subject to an award because of the exercise of a Non-qualified Stock Option and
Stock Appreciation Right shall no longer be available for the grant of an Award
hereunder and (iv) no Eligible Employee shall receive an Award or Awards under
this Plan for, in the aggregate, more than 500,000 shares. In determining the
size of awards, the Board or the Committee may take into account a
Participant's responsibility level, performance, potential, cash compensation
level, the Fair Market Value of the Stock at the time of Awards and such other
considerations as it deems appropriate.
1512
DANAHER CORPORATION
PROXY FOR 19941995
ANNUAL MEETING OF SHAREHOLDERS--MAY 17, 199423, 1995
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF DANAHER
CORPORATION
The undersigned acknowledges receipt of the Proxy Statement and Notice, dated
March 30, 1994,1995, of the Annual Meeting of Shareholders and hereby appoints
Steven M. Rales and Mitchell P. Rales, and each of them, with full power of
substitution, the attorneys, agents and proxies of the undersigned, to act for
and in the name of the undersigned and to vote all the shares of Common Stock
of the undersigned which the undersigned is entitled to vote at the Annual
Meeting of Shareholders of Danaher Corporation (the "Company") to be held May
17, 1994, and at any adjournment or adjournments thereof, for the following
matters:
PLEASE SEE REVERSE SIDE
Dated: , 1994
-------------------
--------------------------------
--------------------------------
Signature of Shareholder(s)
Please sign, date and promptly return this proxy in the enclosed envelope. No
postage is required if mailed in the United States. (Please sign exactly as
your name appears in the space on the left. If stock is registered in more than
one name, each holder should sign. When signing as an attorney, administrator,
executor, guardian or trustee, please add your title as such. If executed by a
corporation, the proxy must be signed by a duly authorized officer, and his
title should appear next to his signature.)
Proxies will be voted in the manner directed herein by the undersigned. IF NO
DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR PROPOSALS 1, 2, 3 and 4.
(Please sign and date on the reverse side.)
1. ELECTION OF DIRECTORS
Nominees Mortimer M. Caplin, Donald J. Ehrlich and Walter G. Lohr, Jr. to serve
in the class of directors with a term expiring in 1997.
WITHHOLD
AUTHORITY
for
all
FOR all Nominees Nominees
[_] [_]
To withhold authority to vote for an individual Nominee, write that Nominee's
name on the line below.
- --------------------------------------------------------------------------------
2. APPROVAL OF AUDITORS
For Against Abstain
[_] [_] [_]
3. APPROVAL OF AMENDMENT TO 1987 STOCK OPTION PLAN
For Against Abstain
[_] [_] [_]
4. APPROVAL OF GRANT OF AN OPTION TO ACQUIRE COMPANY STOCK MADE TO PRESIDENT
AND CEO
For Against Abstain
[_] [_] [_]
5. IN THEIR DISCRETION on any other matter which may properly come before the
meeting, including any adjournment thereof.
PLEASE MARK YOUR CHOICE LIKE THIS [X] IN BLUE OR BLACK INK
LOGO
DANAHER CORPORATION
PROXY FOR 1994
ANNUAL MEETING OF SHAREHOLDERS--MAY 17, 1994
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF DANAHER
CORPORATION
The undersigned acknowledges receipt of the Proxy Statement and Notice, dated
March 30, 1994, of the Annual Meeting of Shareholders and hereby appoints
Steven M. Rales and Mitchell P. Rales, and each of them, with full power of
substitution, the attorneys, agents and proxies of the undersigned, to act for
and in the name of the undersigned and to vote all the shares of Common Stock
of the undersigned which the undersigned is entitled to vote at the Annual
Meeting of Shareholders of Danaher Corporation (the "Company") to be held May
17, 1994,23, 1995, and at any adjournment or adjournments thereof, for the following
matters:
Proxies will be voted in the manner directed herein by the undersigned. IF NO
DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR PROPOSALS 1, 2, 3 and 4.3. PLEASE
SIGN AND DATE ON THE REVERSE SIDE.
1. ELECTION OF DIRECTORS. Nominees MortimerDIRECTOR. Nominee Steven M. Caplin, Donald J. Ehrlich and
Walter G. Lohr, Jr.Rales to serve in the class of
directors with a term expiring in 1997.1998.
[_] FOR NomineesNominee [_] WITHHOLD AUTHORITY for Nominees
To withhold authority to vote for an individual Nominee
write that Nominee's name on the line below.
-----------------------------------------------------------
2. APPROVAL OF AUDITORS
[_] FOR [_] AGAINST [_] ABSTAIN
3.3 APPROVAL OF AMENDMENTPERFORMANCE GOALS FOR 1995 BONUS TO 1987 STOCK OPTION PLANCOMPANY EXECUTIVE OFFICERS
[_] FOR [_] AGAINST [_] ABSTAIN
4. APPROVAL OF GRANT OF AN OPTION TO ACQUIRE COMPANY STOCK MADE TO THE
PRESIDENT AND CEO
[_] FOR [_] AGAINST [_] ABSTAIN
5. IN THEIR DISCRETION on any other matter which may properly come before the
meeting, including any adjournment thereof.
Dated: __________________ , 1994
-------------------
--------------------------------
--------------------------------1995
________________________________
________________________________
Signature of Shareholder(s)
Please sign, date and promptly return this proxy in the enclosed envelope. No
postage is required if mailed in the United States. Please sign exactly as your
name appears in the space on the left. If stock is registered in more than one
name, each holder should sign. When signing as an attorney, administrator,
executor, guardian or trustee, please add your title as such. If executed by a
corporation, the proxy must be signed by a duly authorized officer, and his
title should appear next to his signature.)
PLEASE MARK YOUR CHOICE LIKE THIS [X][///] IN BLUE OR BLACK INK