<PAGE>
SCHEDULE 14A
Proxy Statement Pursuant to Section 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
[_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
CUNO INCORPORATED
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] 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 transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (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 Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------------
(3) Filing Party:
-------------------------------------------------------------------------
(4) Date Filed:
-------------------------------------------------------------------------
Notes:
<PAGE>
[LOGO OF CUNO APPEARS HERE]
Notice of
Annual Meeting
of
Stockholders
March 23, 2000
and
Proxy Statement
CUNO Incorporated
400 Research Parkway
Meriden, Connecticut 06450
<PAGE>
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MARCH 23, 2000
To the Stockholders of CUNO Incorporated:
The Annual Meeting of the Stockholders of CUNO Incorporated will be held at
the Radisson Hotel & Conference Center, 100 Berlin Road, Cromwell, Connecticut
on Thursday, March 23, 2000, at 10:00 a.m., for the following purposes:
1. Election of three (3) Class I Directors to serve for a term of three
(3) years and until their successors shall have been elected and
qualified;
2. Ratification of the selection of Ernst & Young LLP as independent
auditors for the fiscal year ending October 31, 2000; and
3. Transaction of such other business as may properly come before the
meeting and any adjournments or postponements thereof;
all in accordance with the accompanying Proxy Statement.
The Board of Directors has fixed the close of business on January 26, 2000,
as the record date for the determination of the stockholders entitled to notice
of, and to vote at, such meeting.
NEW WAY TO VOTE YOUR SHARES. This year you may choose to vote your shares
by using a toll-free telephone number or the Internet, as described on the proxy
card. You may also mark, sign, date, and mail your proxy in the envelope
provided, which requires no postage if mailed in the United States. We encourage
you to complete and file your proxy electronically or by telephone if these
options are available to you. The method by which you decide to vote will not
limit your right to vote at the Annual Meeting. If you later decide to attend
the Annual Meeting in person, you may vote your shares even if you previously
have submitted a proxy.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ John A. Tomich
JOHN A. TOMICH
Counsel and Secretary
February 1, 2000
VOTING YOUR PROXY IS IMPORTANT.
YOU ARE RECEIVING A PROXY FOR EACH ACCOUNT
IN YOUR HOUSEHOLD. PLEASE VOTE ALL PROXIES
YOU RECEIVE. PROMPT ACTION IN VOTING YOUR
PROXY WILL ELIMINATE THE EXPENSE OF
FURTHER SOLICITATION.
2
<PAGE>
PROXY STATEMENT
Annual Meeting of Stockholders
March 23, 2000
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of CUNO Incorporated (the "Company") of proxies to be
voted at the Annual Meeting of Stockholders (the "Annual Meeting") to be held at
the Radisson Hotel & Conference Center, 100 Berlin Road, Cromwell, Connecticut
on Thursday, March 23, 2000, at 10:00 a.m., and at any adjournments or
postponements thereof, for the purposes set forth in the accompanying Notice of
Annual Meeting of Stockholders.
VOTING SHARES
The Board of Directors has fixed the close of business on January 26, 2000,
as the record date for the determination of stockholders entitled to notice of
and to vote at said meeting. Only stockholders of record at the close of
business on that date will be entitled to vote at the meeting or any
adjournments or postponements thereof. The Company's voting securities
outstanding on January 26, 2000, consisted of 16,321,246 shares of its $.001 par
value common stock ("Common Stock") (exclusive of 4,328 shares of treasury
stock). Each share of Common Stock is entitled to one vote on all matters to
come before the Annual Meeting. A plurality of the votes cast in person or by
proxy is required to elect the nominees for director. The affirmative vote of a
majority of the shares present in person or by proxy is required to ratify the
selection of Ernst & Young LLP as independent auditors of the Company's
financial statements for fiscal year ending October 31, 2000.
Any stockholder giving a proxy will have the right to revoke it at any time
prior to the voting thereof by giving written notice to the Secretary of the
Company. All shares represented by effective proxies will be voted at the Annual
Meeting or at any adjournments or postponements thereof. In addition, if you are
present at the Annual Meeting, you may revoke your proxy at that time and vote
personally on all matters brought before the Annual Meeting. All shares
represented by effective proxies marked "abstain" will be counted as present and
entitled to vote for purposes of reaching a quorum at the Annual Meeting or at
any adjournments or postponements thereof and will be counted for purposes of
voting on any proposal presented at the Annual Meeting or any adjournments or
postponements thereof. Abstentions will have the same effect as votes cast
against a proposal. If a broker indicates on a proxy that it does not have
discretionary authority as to certain shares to vote on a particular matter,
those shares will not be considered as present and entitled to vote with respect
to that matter and will have no effect on the vote on such matter. This Proxy
Statement and the accompanying form of proxy were first mailed to stockholders
on or about February 1, 2000.
A list of stockholders entitled to vote at the Annual Meeting, arranged in
alphabetical order, showing the address of and number of shares registered in
the name of each stockholder, will be open to the examination of any
stockholder, for any purpose germane to the Annual Meeting, during ordinary
business hours, commencing March 13, 2000, and continuing through the date of
the Annual Meeting, at the principal offices of the Company, 400 Research
Parkway, Meriden, Connecticut 06450.
3
<PAGE>
PROPOSAL 1
ELECTION OF DIRECTORS
At the Annual Meeting, three directors of Class I will be elected, each for
a term of three years expiring at the Annual Meeting of Stockholders in 2003.
Directors of Class I whose terms of office expire at the Annual Meeting on March
23, 2000, are Mr. Joel B. Alvord, Dr. Charles L. Cooney, and Mr. John M. Galvin,
all of whom were nominated for reelection by the Board of Directors. It is the
intention of the persons named in the enclosed form of proxy to vote such proxy
as specified and, if no specification is made on a signed and returned proxy, to
vote such proxy for the election as directors the three nominees listed in the
table set forth below to serve for a term of three years and until their
successors shall be elected and qualified. THE BOARD OF DIRECTORS RECOMMENDS
THAT THE STOCKHOLDERS VOTE IN FAVOR OF THE ELECTION OF THE NOMINEES NAMED IN
THIS PROXY STATEMENT TO SERVE AS DIRECTORS OF THE COMPANY.
The Board of Directors has no reason to believe that the persons nominated
will not be available. In the event that a vacancy among such original nominees
occurs prior to the meeting, shares represented by the proxies so appointed may
be voted for a substitute nominee or nominees designated by the Board of
Directors and will be voted for the remaining nominees. All of the nominees
identified herein have consented to serve if elected. In any event, the shares
represented by the proxy will be voted for the election of directors unless
instructed to the contrary.
The terms of office of Mr. Mark G. Kachur and Mr. Gerald C. McDonough both
Class II directors, will expire at the annual meeting in 2001 and the terms of
office of Messrs. Frederick C. Flynn, Jr., C. Edward Midgley, Paul J. Powers and
David L. Swift, all Class III directors, will expire at the annual meeting in
2002.
Each Stockholder will be entitled to vote the number of shares of Common
Stock held as of the record date by such Stockholder for the number of directors
to be elected. Stockholders will not be allowed to cumulate their votes in the
election for directors.
4
<PAGE>
INFORMATION AS TO NOMINEES
The names of the nominees for the office of director to be elected at the
Annual Meeting, together with certain information concerning the nominees, are
set forth below:
Joel B. Alvord, age 61 - Director since 1996
Class I Director (present term expires in 2000)
Mr. Alvord has been a director of the Company since August 1996.
He is currently President and Managing Director of Shawmut Capital
Partners. Prior to joining Shawmut Capital Partners, he was
Chairman of Fleet Financial Group for two years, after it was
merged with Shawmut National Corporation. Mr. Alvord served as
Chief Executive Officer of Shawmut National Corporation from 1987
to 1995. He is a director of HSB Group and Fleet Financial Group.
He has been a member of the Board of the Federal Reserve Bank of
Boston and Swiss Reinsurance Company of North America. He is a
trustee of the Wang Center for the Performing Arts, the American
Repertory Theater and the Harvard Eating Disorders Center.
Dr. Charles L. Cooney, age 55 - Director since 1996
Class I Director (present term expires in 2000)
Dr. Cooney has been a director of the Company since August 1996.
He has been a Professor of Chemical and Biochemical Engineering
at the Massachusetts Institute of Technology ("MIT") since 1982.
At MIT he is also the executive officer of the Department of
Chemical Engineering and the co-director of the Program on the
Pharmaceutical Industry. Since 1989, he has served as the
regional editor of Bioseparations, and in 1992, Dr. Cooney became
a founding Fellow for the American Institute for Medical and
Biological Engineering. He holds a bachelor of science degree in
Chemical Engineering from the University of Pennsylvania and a
master's degree and a Ph.D. in Biochemical Engineering from MIT.
Dr. Cooney is also a director of Genzyme Corporation.
John M. Galvin, age 67 - Director since 1993
Class I Director (present term expires in 2000)
Mr. Galvin has been a director of the Company since 1993, when
the Company was a subsidiary of Commercial Intertech Corp. Since
his retirement in 1992 from The Irvine Company, a major landowner
and developer that also owns a major portfolio of income
property, Mr. Galvin has been a private investor and consultant.
From 1987 until 1992, he was Vice Chairman and Director of The
Irvine Company. He holds a bachelor's degree in Business
Administration from Indiana University. Mr. Galvin is also a
director of Commercial Intertech Corp. and Global Marine, Inc.
5
<PAGE>
INFORMATION CONCERNING DIRECTORS WHOSE TERMS
OF OFFICE WILL CONTINUE AFTER THE ANNUAL MEETING
The names of the remaining six directors of the Company, and certain
information with respect to the directors, are as follows:
Mark G. Kachur, age 56 - Director since 1996 Class II
(present term expires in 2001)
Mr. Kachur has been a director of the Company since July
1996, Chairman of the Board since November 1, 1999,
President and Chief Executive Officer of the Company since
December 1, 1997, and President and Chief Operating Officer
of the Company from September 1996 until December 1, 1997.
Since joining the Company in 1994, Mr. Kachur has been
President of the Company. From 1992 until 1994, he was
President and CEO of Biotage, Inc., and from 1971 to 1991,
he was with Pall Corporation, the last seven years as a
Group Vice President. He holds a bachelor of science degree
in Mechanical Engineering from Purdue University and a
master's degree in Business Administration from the
University of Hartford.
Gerald C. McDonough, age 71 - Director since 1992
Class II (present term expires in 2001)
Mr. McDonough has been a director of the Company since 1992,
when the Company was a subsidiary of Commercial Intertech
Corp. Mr. McDonough retired from Leaseway Transportation
Corporation, a trucking company, in 1988, prior to which he
had served as Chairman of the Board and Chief Executive
Officer since 1982. He holds a bachelor's degree in Business
Administration from Case Western Reserve University. Mr.
McDonough is also a director of Commercial Intertech Corp.
and Associated Estates Realty Corporation, Chairman of the
Board of York International Corporation, and Chairman of the
Independent Trustees of the Fidelity Funds.
Frederick C. Flynn, Jr., age 49 - Director since 1999
Class III Director (present term expires in 2002)
Mr. Flynn was appointed a Director of the Company, Senior
Vice President - Finance and Administration, Chief Financial
Officer, Treasurer and Assistant Secretary of the Company in
January 1999. From 1997 through 1998, he served as Senior
Vice President -Finance and Chief Financial Officer of GE
Capital Information Technology Solutions, a computer systems
distributor and service provider. In 1996 he was Senior Vice
President - Finance of National Medical Care, Inc., a
healthcare services provider, and from 1979 to 1995 he was
with United Technologies Corporation, the last six years as
Vice President -Treasurer. He holds a bachelor of science
degree in Economics from Boston College and a master's
degree in Business Administration from the University of
Connecticut.
6
<PAGE>
C. Edward Midgley, age 62 - Director since 1995
Class III Director (present term expires in 2002)
Mr. Midgley has been a director of the Company since 1995,
when the Company was a subsidiary of Commercial Intertech
Corp. Mr. Midgley has been associated with PaineWebber
Incorporated since 1995 and is currently an Advisory
Director. From 1992 until 1995, he was Co-Head of Investment
Banking, Executive Managing Director, Head of Mergers and
Acquisitions and a Member of the Board of Directors of
Kidder, Peabody & Co. Incorporated. He holds a bachelor of
arts degree in Economics from Princeton University and a
master's degree in Business Administration from Harvard
Business School. Mr. Midgley is also a director of
Commercial Intertech Corp.
Paul J. Powers, age 64 - Director since 1986
Class III Director (present term expires in 2002)
Mr. Powers has been a director of the Company since 1986,
when the Company was a subsidiary of Commercial Intertech
Corp., an Executive Officer of the Company since December 1,
1997, Chairman of the Board of Directors from June 1987
until October 31, 1999, and Chief Executive Officer of the
Company from July 1996 until December 1, 1997. He has also
been President and Chief Operating Officer of Commercial
Intertech Corp. since 1984 and Chairman and Chief Executive
Officer since 1987. He holds a bachelor's degree in
Economics from Merrimack College and a master's degree in
Business Administration from George Washington University.
Mr. Powers is also a director of Commercial Intertech Corp.,
First Energy Corp., Global Marine, Inc. and Twin Disc,
Incorporated.
David L. Swift, age 63 - Director since 1996
Class III Director (present term expires in 2002)
Mr. Swift has been a director of the Company since August
1996. Mr. Swift retired in 1996 from Acme-Cleveland
Corporation, a manufacturer of communications, motion
control and measurement products, where he served as
Chairman of the Board since 1993 and Chief Executive Officer
and President since 1988. He holds a bachelor of science
degree from Ball State University and a juris doctorate from
the Salmon P. Chase College of Law. Mr. Swift is also a
director of Alltrista Corporation, LESCO Inc., and Twin
Disc, Incorporated.
7
<PAGE>
BOARD MEETINGS AND COMMITTEE INFORMATION
The Board of Directors held six meetings during fiscal 1999 and established
committees to assist in the discharge of its responsibilities. These presently
include the Audit, Pension and Nominating, and Compensation Committees. During
the fiscal year, all directors attended 75% or more of the aggregate meetings of
the Board and the Board committees to which they were assigned. The attendance
at the meetings of the Board of Directors and committee meetings during the year
was 92%.
The Audit Committee has the responsibility of recommending the selection of
independent auditors to the Board of Directors; reviewing with such auditors,
prior to the commencement of or during such audit for each fiscal year, the
scope of the audit to be made; reviewing with such auditors the results of their
audits, any changes in accounting policies, the services rendered by such
auditors (including management consulting services) and the effect of such
services on the independence of such auditors; reviewing the Company's internal
audit and control functions; considering such other matters relating to such
audits and to the accounting procedures employed by the Company as the Audit
Committee may deem appropriate; and reporting to the full Board of Directors
regarding all of the foregoing. During the fiscal year, the Committee held three
meetings with the auditors. The Audit Committee consists of the following four
members: Messrs. Galvin (Chairman), Midgley, Swift, and Dr. Cooney. None of the
members of the Audit Committee is an employee or former employee of the Company.
The Pension and Nominating Committee has the responsibility of identifying,
recruiting and nominating prospective members of the Board of Directors. Any
stockholder may nominate a person for election to the Board of Directors by
contacting the Chairman of the Pension and Nominating Committee or through the
procedures outlined in Section 2.6 of the Company's By-Laws. The Pension and
Nominating Committee also has the responsibility of overseeing and evaluating
the investments of the Company's pension plan trusts, selecting fund managers
and reviewing their performance and designating the proportion of pension
contributions to be assigned to such managers. During the year, the Committee
held two meetings. The Pension and Nominating Committee consists of the
following six members: Messrs. Midgley (Chairman), Alvord, Galvin, Kachur,
McDonough and Powers.
The Compensation Committee has the authority to determine annual salaries
and bonuses for all elected officers and senior management except for the
Chairman and the Chief Executive Officer; has the authority to approve incentive
and deferred compensation plans, and funding arrangements related thereto, for
elected officers and senior management; and administers such plans. The
Compensation Committee recommends to the non-employee members of the Board of
Directors the annual salary, bonus, stock options, performance shares and
restricted shares for the Chairman and Chief Executive Officer. During the
fiscal year, the Compensation Committee held six meetings. The Compensation
Committee consists of the following six members: Messrs. McDonough (Chairman),
Alvord, Galvin, Midgley, Swift and Dr. Cooney. None of the members of the
Compensation Committee is an employee or former employee of the Company. See
"Compensation Committee Report on Executive Compensation."
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act")
requires the Company's directors, executive officers, and persons who own more
than ten percent of a registered class of the Company's equity securities, to
file with the Securities and Exchange Commission (the "SEC") initial reports of
beneficial ownership and reports of changes in beneficial ownership of Common
Stock. Officers, directors and greater than ten-percent stockholders are
required by SEC regulations to furnish the Company with copies of all Section
16(a) forms they file.
To the Company's knowledge, based solely on review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended October 31, 1999, all
Section 16(a) filing requirements applicable to its officers, directors and
greater than ten-percent beneficial owners were met.
8
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth information with respect to the cash
compensation paid by the Company for services rendered during the fiscal years
ended October 31, for the years listed below to its Chief Executive Officer and
the other four executive officers of the Company whose total annual salary and
bonus exceeded $100,000 during fiscal year 1999 (each, a "Named Executive
Officer").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long-Term Compensation
----------------------
Annual Compensation Awards Payouts
------------------- ------ -------
Restricted Securities
Other Annual Stock Underlying LTIP All Other
Salary Bonus Compensation Awards/(1)/ Options Payouts Compensation
Year ($) ($) ($) ($) (#) ($)/(2)/ ($)
--- --- --- --- --- --- --- ---
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Mark G. Kachur/(3)/ 1999 350,000 190,700 15,180 571,508 20,000 -0- 5,000/(5)/
President and Chief Executive 1998 344,615 36,250 15,028 482,825 100,000 -0- 5,000
Officer 1997 280,057 230,000 15,417 25,003 -0- 328,379 4,750
Paul J. Powers/(4)/ 1999 100,000 162,650 -0- 203,327 36,000 -0- 3,000/(6)/
Chairman 1998 100,000 40,000 15,180 50,008 -0- -0- 3,000
1997 100,000 225,000 17,882 281,251 -0- -0- 1,846
Frederick C. Flynn, Jr./(11)/ 1999 206,731 152,900 12,100 556,584/(9)/ 13,000 -0- 1,731/(10)/
Senior Vice President - 1998
Finance & Administration and 1997
Chief Financial Officer
Michael H. Croft 1999 213,000 152,500 23,760 178,375 8,500 -0- 5,000/(7)/
Senior Vice President 1998 213,000 42,600 23,760 -0- -0- -0- 5,000
1997 205,045 100,000 23,910 -0- -0- 40,307 26,618
Thomas J. Hamlin 1999 167,701 82,300 11,394 70,625 5,000 -0- 4,800/(8)/
Senior Vice President - 1998 110,004 15,800 -0- -0- -0- -0- 3,762
Research & Development 1997 89,237 -0- 8,174 4,495 -0- -0- 2,985
</TABLE>
_____________________________________
(1) This column shows the market value of restricted share awards on the date
of grant. The aggregate holdings/value of restricted stock held on October
31, 1999, by the individuals listed in this table, not including awards
which were earned after the end of the fiscal year as part of the Company's
Executive Management Incentive Plan ("EMIP") and were elected to be taken
in the form of restricted stock, as described in the Compensation Committee
Report on Executive Compensation were: Mark G. Kachur - 53,603
shares/$1,072,060; Paul J. Powers - 18,983 shares/$379,660; Frederick C.
Flynn, Jr. - 36,902 shares/$738,040; Michael H. Croft - 9,000
shares/$180,000; Thomas J. Hamlin - 5,000 shares/$100,000.
(2) The amounts paid in 1997 include the market value of Commercial Intertech
Corp. common shares earned and the accrued Commercial cash dividends
together with the CUNO Incorporated common stock issued in connection with
the Spin-off from Commercial.
9
<PAGE>
(3) On November 1, 1999, Mr. Kachur became Chairman of the Board of Directors
and was confirmed as Chief Executive Officer and President.
(4) On October 31, 1999, Mr. Powers resigned as Chairman of the Board of
Directors and remains on the Board as a Director.
(5) Company matching contributions pursuant to the Company 401(k) Plan.
(6) Company matching contributions pursuant to the Company 401(k) Plan.
(7) Company matching contributions pursuant to the Company 401(k) Plan.
(8) Company matching contributions pursuant to the Company 401(k) Plan.
(9) On February 1, 2000, 3,451 shares will vest and on February 1, 2001, 3,451
shares will vest. Dividends, if any are paid, will accrue on the restricted
stock.
(10) Company matching contributions pursuant to the Company 401(k) Plan.
(11) On January 5, 1999, Frederick C. Flynn, Jr. joined the Company as Senior
Vice President - Finance & Administration and Chief Financial Officer.
The following table sets forth, for each of the Named Executive Officers,
options granted on Common Stock during fiscal year 1999 pursuant to the CUNO
Incorporated 1996 Stock Incentive Plan.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Potential Realizable
Value
at Assumed Annual Rate
of Stock Price
Appreciation for Option
Individual Grants Term
-------------------------------------------------------------------------------
Number of % of Total
Securities Options
Underlying Granted to
Options Employees Exercise or
Granted In Fiscal Base Price Expiration
(#)/(1)/ Year ($/Share) Date 5% ($) 10% ($)
--- ---- --------- ---- ------ -------
<S> <C> <C> <C> <C> <C> <C>
Mark G. Kachur...... 20,000 10.2% 14.125 11/16/08 177,693 450,305
Paul J. Powers...... 36,000 18.3% 14.125 11/16/08 319,847 810,549
Frederick C. Flynn, Jr. 13,000 6.6% 15.875 01/04/09 129,810 328,962
Michael H. Croft.... 8,500 4.3% 14.125 11/16/08 75,519 191,380
Thomas J. Hamlin.... 5,000 2.5% 14.125 11/16/08 44,423 112,576
</TABLE>
(1) The options were granted subject to a three-year vesting period, with 50%
of the options granted becoming exercisable on the second anniversary of
the grant date and 50% on the third anniversary. No SARS were granted. The
exercisability of the options may be accelerated in the event of a change
in control.
10
<PAGE>
The following table sets forth, for each of the Named Executive Officers,
information regarding the exercise of options on the Common Stock during fiscal
year 1999 and unexercised options held as of the end of fiscal year 1999
pursuant to the CUNO Incorporated 1996 Stock Incentive Plan.
AGGREGATED OPTION EXERCISES IN FISCAL YEAR 1999 AND
FISCAL YEAR-END 1999 OPTION VALUES
<TABLE>
<CAPTION>
Shares Value Number of Securities Value of Unexercised
Acquired on Realized Underlying Unexercised In-the-Money Options
Name Exercise (#) ($) Options at FY-End (#) at FY-End ($)/1/
---- ------------ -- --------------------- ----------------
Exercisable/ Exercisable/
Unexercisable Unexercisable
------------- -------------
<S> <C> <C> <C> <C>
Mark G. Kachur............... -0- -0- 177,536/70,000 1,170,426/214,375
Paul J. Powers............... -0- -0- 65,000/36,000 316,875/211,500
Frederick C. Flynn, Jr....... -0- -0- 0/13,000 0/53,625
Michael H. Croft............. -0- -0- 13,000/8,500 63,375/49,937
Thomas J. Hamlin............. -0- -0- 3,000/5,000 14,625/29,375
</TABLE>
__________________________________
/1/ The value per option is calculated by subtracting the exercise price from
the October 29, 1999, closing price of the Common Stock on the NASDAQ National
Market of $20.00.
The following table sets forth, for each of the Named Executive
Officers, long-term incentive awards made during fiscal year 1999 pursuant to
the CUNO Incorporated 1996 Stock Incentive Plan.
LONG-TERM INCENTIVE PLAN AWARDS IN lAST FISCAL YEAR
<TABLE>
<CAPTION>
Estimated Future Payouts Under
Non-Stock Price Based Plans
---------------------------
Number of Performance or Other
Shares, Units Period Until Maturation Threshold Target Maximum
Name or Other or Payout (#) (#) (#)
---- ----- --------- --- --- ---
Rights (#)
----------
<S> <C> <C> <C> <C> <C>
Mark G. Kachur -0- - - - -
Paul J. Powers -0- - - - -
Frederick C. Flynn, Jr. -0- - - - -
Michael C. Croft -0- - - - -
Thomas J. Hamlin -0- - - - -
</TABLE>
11
<PAGE>
Employees may retire from the Company with unreduced benefits under
the Company's retirement plans at age 65 or later with 25 or more years of
service. The table below shows the estimated annual pension benefits provided
under the Company's defined benefit retirement plans for employees in higher
salary classifications retiring at age 65 or later.
ESTIMATED TOTAL ANNUAL RETIREMENT BENEFITS UNDER THE PENSION PLAN FOR
SALARIED EMPLOYEES AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS
<TABLE>
<CAPTION>
Years of Service
--------------------------------------------------------
Remuneration 15 20 25 30 35
------------ -- -- -- -- --
<S> <C> <C> <C> <C> <C>
$200,000 $55,057 $73,410 $91,762 96,350 100,938
300,000 85,057 113,410 141,762 148,850 155,938
400,000 115,057 153,410 191,762 201,350 210,938
500,000 145,057 193,410 241,762 253,850 265,938
600,000 175,057 233,410 291,762 306,350 320,938
700,000 205,057 273,410 341,762 358,850 375,938
</TABLE>
Benefits under the plans are calculated generally under a formula of
50% of the participant's final average compensation reduced by 50% of the
participant's estimated social security benefits, reflected in the table in the
form of a straight life annuity. The compensation covered by the pension plan is
base salary as set forth in the Salary column of the Summary Compensation Table
above. The compensation covered by the supplemental executive retirement plan is
also base salary for Mr. Kachur, the only participant in such plan. As of
December 31, 1999, Mr. Kachur had five years of credited service and Mr. Hamlin
had sixteen years of credited service with the Company. Michael Croft has
elected not to participate in the pension plan. In addition, Paul J. Powers is
not a participant in the pension plan.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Overall Policy and Administration
The Company's executive compensation as developed and administered by
the Compensation Committee of the Board of Directors (the "Compensation
Committee") is designed to preserve and enhance stockholder value in the context
of a progressive, global technology and manufacturing company. The executive
compensation program links executive and stockholder financial interests by:
. Motivating executives toward longer term strategic management of
assets and operations through stock programs that focus executive
attention on increasing stockholder value;
. Recognizing and rewarding individual contributions and achievements as
well as overall business performance via annual incentives tied to the
achievement of annual operating, financial and strategic objectives;
and
. Providing a competitive base salary structure and total compensation
opportunity to attract and retain the executive, research, technical
and other management talent necessary to ensure the Company's
continued profitable growth and maintenance of high technological
standards.
12
<PAGE>
The Compensation Committee establishes salaries for corporate officers
and administers the Company's Executive Management Incentive Plan ("EMIP"),
Management Incentive Plan ("MIP") and the 1996 Stock Incentive Plan. In its
decision-making process, the Compensation Committee uses independent
compensation consultants and may periodically seek input from appropriate
Company executives.
Base Salaries
In the aggregate, the Compensation Committee establishes base salaries
at or near the market median (50/th/ percentile) of senior executives and other
corporate officers in comparably sized technology and manufacturing companies.
In addition, other factors may be considered when setting individual salary
levels, which may result in salaries above or below the stated target. These
factors may include:
. Availability of talent.
. The recruiting requirements of the particular situation.
. Specific research and technical backgrounds.
. Experience.
. Anticipated performance.
Any adjustments in the base salaries of senior executives and other
corporate officers will normally occur as of January 1 each year and are
dependent on such factors as:
. The executive's current responsibilities, experience, and
performance.
. Competitive compensation practices at comparably sized technology
and manufacturing companies,
. The Compensation Committee's assessment regarding the executive's
overall contribution.
Annual Incentive Compensation
The Compensation Committee administers two annual incentive plans
covering management participants. The EMIP was approved by stockholders in 1996
and is a performance-based plan in which payouts are set in accordance with the
requirements of Internal Revenue Code ("IRC") Section 162(m). It provides annual
incentive compensation opportunities to the Company's two most senior executives
based solely on the achievement of predetermined financial performance
objectives. Target awards, as a percent of base salary, range from 45 to 60
percent for the two executive participants.
In addition, the Compensation Committee also administers the MIP,
which provides compensation that is not performance based as defined in Code
Section 162(m), but which is based on Company performance as well as objective
and subjective evaluations of individual executive performance. The MIP provides
opportunities for Company executives to earn annual incentives based on the
achievement of a combination of important financial goals (such as operating and
net income, earnings per share, return on sales, return on assets and/or cash
flow) for the Company as well as individual objectives. A threshold net income
level must be achieved before any payments are made. Target awards, as a percent
of base salary, range from 10% to 80% for plan participants.
Participants for fiscal 1999 included 57 individuals with target
incentive award opportunities primarily based on:
. Individual responsibility levels.
. Market median data for comparably sized technology and
manufacturing companies.
To enhance the Company's objectives of encouraging additional stock
ownership and increasing Company cash flow, certain participants in the EMIP and
MIP may elect to receive up to 100% of their award in restricted stock. If the
participant elects to receive restricted stock, the Company increases the award
by 25%. The vesting period associated with the stock award is four years and the
shares are forfeited in the event a participant voluntarily leaves the Company
or is terminated "for cause."
13
<PAGE>
The 1996 Stock Incentive Plan
The 1996 Stock Incentive Plan allows for the grant of a variety of
stock incentive instruments, including non-qualified and incentive stock
options, stock appreciation rights, restricted stock and performance shares. At
the time the Company was spun off from Commercial Intertech Corp., in 1996, the
Compensation Committee made a grant of stock options to the Company's key
executives to create a direct link between stockholder and executive interests,
specifically by focusing executive attention on increasing stockholder value.
The Committee made an additional grant of stock options to key executives in
fiscal 1999 in furtherance of aligning the executive interests with those of the
stockholder.
Also in fiscal 1999, the Compensation Committee granted restricted
stock to selected participants. The restricted stock contains a four-year
vesting period, and is forfeitable if the participant leaves the Company under
certain conditions. The restricted stock grants are intended to provide a
long-term retention incentive to key executives of the Company.
In determining stock option, performance share, and restricted stock
awards, the Committee considers such factors as:
. Median competitive award levels for comparable companies.
. The need to attract, motivate, and retain managers, technical,
and research and development talent as well as other
professionals.
. Company and individual performance.
The Company also awards time-lapse restricted stock grants in special
circumstances, such as to attract and retain newly hired executives and for
other similar non-recurring situations.
Chief Executive Officer Compensation
Mr. Kachur was paid a base salary of $350,000 for fiscal 1999.
For performance in fiscal 1999, Mr. Kachur received a payment under
the EMIP of $273,300. This payment was calculated from a predetermined formula
based on corporate net income set by the Compensation Committee and certified by
the Compensation Committee in accordance with the provisions of the Code Section
162(m). In addition, Mr. Kachur received a payment from the MIP of $91,000 based
on the Compensation Committee's judgment on his achievement of individual goals
and objectives during 1999. Mr. Kachur elected to receive a portion of these
awards in deferred, restricted stock.
Mr. Kachur received 25,000 time-lapse restricted shares and a
multi-year stock option grant of 20,000 shares in fiscal 1999. In determining
these grants, the Compensation Committee wanted to ensure that Mr. Kachur's
long-term incentive compensation was delivered through stock price appreciation
in order to establish a strong financial link between Mr. Kachur and the
Company's shareholders.
Internal Revenue Code Section 162(m)
A 1993 IRC amendment caps the allowable federal income tax deduction
for compensation paid to each of the proxy-reported officers of a public
company. The deduction limit, effective since 1994, does not apply to
compensation paid under a plan that meets certain requirements for performance-
based compensation. These requirements include:
. Compensation payable based upon the attainment of one or more pre-
established objective performance goals;
. Performance goals established by a Compensation Committee of the Board of
Directors that is comprised solely of two or more "outside directors;"
14
<PAGE>
. The terms of the compensation and the performance criteria disclosed to and
approved by stockholders before payment;
. The Compensation Committee certifies in writing that the performance goals
have been satisfied before payment.
The Compensation Committee's general policy is to structure the major
components of the Company's incentive compensation programs to satisfy the
requirements of performance-based compensation and preserve the deductibility of
compensation paid to executive officers on an ongoing basis.
To implement the above policy, the Company sought and received
stockholder approval of the 1996 Stock Incentive Plan. Furthermore, in 1999, the
Company sought and received stockholder approval to increase the number of
shares available for awards under the 1996 Stock Incentive Plan. Such approvals
preserved the tax deductibility of stock options, performance shares and annual
incentive awards awarded to the Company's executive officers under the EMIP and
MIP. The 1996 Stock Incentive Plan links compensation to the achievement of key
financial objectives to motivate employees and increase stockholder value.
By: The Compensation Committee
Gerald C. McDonough, Chairman Dr. Charles L. Cooney John M. Galvin
Joel B. Alvord Gerald C. McDonough C. Edward Midgley
Compensation of the Board of Directors
Directors who are not employees or officers of the Company receive an
annual retainer fee in the amount of $15,000, plus $1,000 for attending each
meeting of the Board of Directors and $600 for attending each respective
committee meeting. Non-employee directors have the option to make an election to
receive the retainer, Board and Committee meeting fees in deferred stock units
instead of cash. Those directors who opt for the stock unit alternative receive
a 20 percent premium in stock units versus the cash option. Directors are also
reimbursed for reasonable travel and other expenses related to meetings of the
Board and committees. Non-employee directors receive non-qualified stock options
to purchase 1,000 shares of Common Stock annually and biannually receive 1,000
performance shares. The performance shares are earned based upon the achievement
of certain Company financial targets during a three-year cycle. Each non-
employee director received an award of 6,000 additional performance shares and
stock options to purchase 1,000 shares of Common Stock at the time of the Spin-
off. Directors who are employees or officers of the Company do not receive
compensation for serving as directors or members of committees. Mr. Powers, Mr.
Kachur and Mr. Flynn, as officers of the Company, are not compensated for
serving as directors or members of committees of the Company.
Employment Agreements
On December 1, 1997, the Company entered into a written agreement to
employ Mark G. Kachur as President and Chief Executive Officer. Mr. Kachur's
Employment Agreement expires on November 30, 2000. The Employment Agreement
provides for the payment of a base salary of $350,000, which can be increased at
the discretion of the Company. Additionally, Mr. Kachur will be eligible to (1)
receive bonuses as part of the Company's EMIP and MIP; and (2) participate in
other incentive, stock option, profit sharing and similar plans maintained by
the Company for the benefit of its executives. In addition, the Employment
Agreement with Mr. Kachur provides that, in the event of his termination without
cause (as defined in his Employment Agreement), Mr. Kachur will receive a lump
sum payment equal to two times his recent annual cash compensation. Finally, Mr.
Kachur will be included in all other employee benefit plans to the extent that
he is eligible. Such plans include, but are not limited to, group life insurance
plans, hospitalization and medical plans and long-term disability plans.
On January 5, 1999, the Company entered into a written agreement to
employ Frederick C. Flynn, Jr. Mr. Flynn's Employment Agreement expires on
January 4, 2002. The Employment Agreement provides for the payment of a
15
<PAGE>
base salary of $250,000, which can be increased at the discretion of the
Company. Additionally, Mr. Flynn will be eligible to (1) receive cash bonuses as
part of the Company's MIP; and (2) participate in other incentive, stock option,
profit sharing and similar plans maintained by the Company for the benefit of
its executives. In addition, the Employment Agreement with Mr. Flynn provides
that, in the event of his termination without cause (as defined in his
Employment Agreement), Mr. Flynn will receive a lump sum payment equal to two
times his recent annual cash compensation. Finally, Mr. Flynn will be included
in all other employee benefit plans to the extent that he is eligible. Such
plans include, but are not limited to, group life insurance plans,
hospitalization and medical plans, and long-term disability plans.
Change of Control Agreements
The Company has entered into change in control agreements
("Agreements") with Messrs. Kachur, Powers, Flynn, Croft and Hamlin (the
"Executives"). Under the Agreements, following a "Change in Control" (as defined
in the Agreements), if the Executives are terminated without cause or if the
Executives terminate their own employment for certain reasons, the Executives
could receive (in addition to certain other benefits described below) (i)
accrued and unpaid base salary and a pro rata portion of their highest recent
bonus; (ii) two or three times the sum of their base salary and highest recent
annual bonus during the three preceding years; (iii) the value of any shares,
dividends or other property payable assuming maximum performance with respect to
any performance shares held by the Executives; (iv) the actuarial value of
accrued benefits under the supplemental executive retirement plan; (v) all
vested nonforfeitable amounts owing under any comprehensive benefit plans; (vi)
continuation of certain benefits for two or three years, such as medical
benefits; and (vii) certain other benefits and payments. If a Change in Control
occurs, the Company is obligated to set aside, in trust, sufficient assets to
fund all obligations under the Agreements. In addition, payment received by the
Executives in connection with a Change in Control could be "grossed up" for any
excise taxes imposed by the "parachute payment" provisions of the IRC. Under the
Agreements, each of the Executives has agreed not to compete with the Company
for a stated period of time.
16
<PAGE>
Performance Graph
The following graph shows a comparison of cumulative total returns
during the period commencing on September 10, 1996, the date the Company was
spun-off from Commercial Intertech Corp., and ending on October 31, 1999, for
the Company, the Russell 2000 Index, the Company's Peer Group/1/, the Standard
and Poor's Composite 500 (S&P 500) Index and the Standard and Poor's
Manufacturing Diversified Industries (S&P MFG) Index/2/. The comparison assumes
$100 was invested on September 10, 1996, in the Common Stock, the Russell 2000,
the Peer Group, the S&P 500 and the S&P MFG, and assumes the reinvestment of all
dividends, if any.
CUNO vs. RUSSELL 2000; PEER GROUP; S&P 500 & S&P MANUF, INDEX
COMPARISON OF CUMULATIVE TOTAL RETURN
[COMPARISON CHART APPEARS HERE]
<TABLE>
<CAPTION>
September 10, October 31, October 31, October 31, October 31,
1996 1996 1997 1998 1999
<S> <C> <C> <C> <C> <C>
CUNO 100.00 105.82 112.43 100.86 132.28
RUSSELL 2000 100.00 98.44 127.08 112.30 129.07
PEER GROUP/1/ 100.00 102.94 95.46 89.52 89.76
S&P 500 100.00 108.54 143.40 174.93 219.55
S&P MFG 100.00 107.98 134.87 148.65 188.29
</TABLE>
/1/ Includes: Calgon Carbon Corporation, Ionics Inc., Millipore Corp., Osmonics
Inc. and Pall Corporation.
/2/ The Company has chosen the Russell 2000 Index and Peer Group Index as more
representative measures of the Company's relative performance than the S&P
500 Index and the S&P MFG Index the Company used in prior years. The Russell
2000 Index is a market-weighted index comprising approximately 2,000 common
stocks issued by a wide range of smaller-capitalization U.S. companies. The
Peer Group Index represents public companies against which the Company
competes.
17
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
The directors, nominees for the office of director, the Named
Executive Officers, and all directors and executive officers as a group were the
beneficial owners of Common Stock, as of December 31, 1999, as set forth below:
<TABLE>
<CAPTION>
Amount and
Nature of Percent of
Beneficial Voting
Ownership Shares
--------- ------
<S> <C> <C>
Joel B. Alvord......................................................... 31,554 /(2)/ *
Charles L. Cooney...................................................... 14,857 /(2)/ *
Michael H. Croft....................................................... 53,234 /(1) (2)/ *
Frederick C. Flynn, Jr................................................. 39,431 /(1)/ *
John M. Galvin......................................................... 24,597 /(2)/ *
Thomas J. Hamlin....................................................... 10,188 /(1)(2)/ *
Mark G. Kachur......................................................... 330,532 /(1)(2)/ 2.03%
Gerald C. McDonough.................................................... 21,593 /(2)/ *
C. Edward Midgley...................................................... 45,253 /(2)(3)/ *
Paul J. Powers......................................................... 395,798 /(1)(2)/ 2.43%
David L. Swift......................................................... 19,049 /(2)/ *
All Directors and Executive Officers as a group (14 people)............ 1,037,466 6.36%
</TABLE>
- ------------------
* Less than 1%.
(1) Includes the following number of shares of Common Shares (fractional shares
not shown) credited to the accounts of the above-mentioned beneficial
owners by the trustee acting under the provisions of the Company 401(k)
Plan: Mr. Croft 3,264 shares; Mr. Flynn 278 shares; Mr. Hamlin 1735 shares;
Mr. Kachur 691 shares; and Mr. Powers 1,296 shares.
(2) Includes shares of Common Stock acquirable within 60 days of December 31,
1999, upon exercise of options issued under the Company's 1996 Stock
Incentive Plan as follows: Mr. Alvord 3,000 shares; Dr. Cooney 3,000
shares; Mr. Croft 13,000 shares; Mr. Galvin 3,000 shares; Mr. Hamlin 3,000
shares, Mr. Kachur 177,536 shares; Mr. McDonough 3,000 shares; Mr. Midgley
3,000 shares; Mr. Powers 65,000 shares; and Mr. Swift 3,000 shares.
(3) Does not include 10,000 shares of Common Stock owned by Mr. Midgley's wife.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
<TABLE>
<CAPTION>
Title of Name and Address of Amount and Nature of Percent
Class Beneficial Owner Beneficial Ownership (1) of Class
<S> <C> <C> <C>
Common David L. Babson & Co., Inc. 1,826,370 (2) 11.2%
One Memorial Drive
Cambridge, MA 02142-1300
Common Gabelli Asset Management Inc. 1,051,900 (3) 6.4%
One Corporate Center
Rye, NY 10580
Common Thomson, Horstmann & Bryant 947,100 (4) 5.8%
Park 80 West Plaza Two
Saddle Brook, NJ 07663
</TABLE>
(1) The information contained in this Table was obtained from Schedule 13G's or
from information provided by the Beneficial Owner.
(2) David L. Babson & Co. has sole voting power over 1,825,490 shares and
shared voting power over 880 shares. David L. Babson & Co. has sole
investment power over 1,826,370.
(3) Gabelli Asset Management Inc. has sole voting power over 1,051,900 shares
and sole investment power over 1,051,900.
(4) Thomson, Horstmann & Bryant has sole voting power over 476,400 shares and
shared voting power over 22,900 shares and no voting power over 447,800
shares. Thomson Horstmann & Bryant has sole investment power over 947,100
shares.
18
<PAGE>
PROPOSAL 2
SELECTION OF INDEPENDENT AUDITORS
The Board of Directors has selected Ernst & Young LLP to audit the
consolidated financial statements of the Company and its subsidiaries for the
fiscal year ending October 31, 2000. A representative of Ernst & Young LLP is
expected to be present at the Annual Meeting with the opportunity to make a
statement if such representative so desires and will also be available to
respond to appropriate questions from stockholders.
Unless contrary instructions are noted on the proxy, it will be voted
to ratify the selection by the Board of Directors of Ernst & Young LLP as
independent auditors for the fiscal year ending October 31, 2000. The
affirmative vote of the holders of a majority of the voting shares represented
at the Annual Meeting is required for such ratification. THE BOARD OF DIRECTORS
RECOMMENDS THAT THE STOCKHOLDERS VOTE IN FAVOR OF RATIFICATION OF THE SELECTION
OF AUDITORS.
ANNUAL REPORT TO STOCKHOLDERS
The annual report of the Company and its subsidiaries for the fiscal
year ended October 31, 1999, including financial statements reflecting the
financial position and operations of the Company and its subsidiaries for that
year, is being mailed to stockholders simultaneously with this Proxy Statement.
The annual report is not deemed to have been filed with the Securities and
Exchange Commission and is not part of this proxy.
2001 ANNUAL MEETING OF STOCKHOLDERS
The deadline for receipt by the Company of stockholders' proposals for
including in the Company's proxy statement and form of proxy for its 2001 annual
meeting of stockholders (the "2001 Meeting") is October 4, 2000. No stockholder
proposal will be considered at the 2001 Meeting unless proper notice is received
by the Company between December 3, 2000, and December 18, 2000. The Company form
of proxy for the 2001 Meeting will confer discretionary authority upon the
persons named as proxies to vote on any untimely stockholder proposals; and, the
proxy statement will advise how the proxies intend to vote on any timely
stockholder proposals which are not included in the Company's proxy statement
and form of proxy.
FORM 10-K
A COPY OF THE COMPANY'S ANNUAL REPORT AS FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION ON FORM 10-K FOR THE FISCAL YEAR ENDED OCTOBER 31, 1999, MAY
BE OBTAINED BY STOCKHOLDERS AFTER JANUARY 31, 2000, WITHOUT CHARGE, ON WRITTEN
REQUEST DIRECTED TO THE SECRETARY, CUNO INCORPORATED, 400 RESEARCH PARKWAY,
MERIDEN, CONNECTICUT 06450.
OTHER MATTERS
The Board of Directors does not know of any matters of business to be
presented for action at the Annual Meeting other than as set forth above. The
enclosed proxy does, however, confer discretionary authority upon the persons
named therein, or their substitutes, to take action with respect to any other
matters that may properly be brought before the Annual Meeting.
19
<PAGE>
SOLICITATION OF PROXIES
The enclosed form of proxy is solicited by the Board of Directors.
Shares represented by the proxy will be voted at the Annual Meeting and such
shares will be voted in accordance with the shareholder's written instructions.
The cost of preparing, printing, assembling and mailing will be paid by the
Company. Officers, directors or other employees of the Company, without
additional remuneration, may solicit proxies personally or by other appropriate
means, if deemed advisable. The Company will also request brokers, banks and
other nominees to send proxy material to and obtain proxies from their
principals, and it will reimburse such persons for their expenses in so doing.
In addition, the Company has retained Morrow & Co., Inc. to assist in the
solicitation of proxies. Morrow & Co., Inc. will request brokerage houses and
other nominees, fiduciaries and custodians nominally holding shares of the
Company's Common Stock of record to forward proxy solicitation material to the
beneficial owners of such shares. For these services, the Company will pay
Morrow & Co., Inc. a fee estimated not to exceed $5,000 plus reimbursement of
expenses.
Please complete, sign, date and return your proxy promptly to ensure
that your shares will be voted at the Annual Meeting. We hope that you will
attend the Annual Meeting. For your convenience, a self-addressed envelope,
which requires no additional postage if mailed in the United States, is
enclosed.
BY THE ORDER OF THE BOARD OF DIRECTORS
/s/ John A. Tomich
JOHN A. TOMICH
Counsel and Secretary
Meriden, Connecticut
February 1, 2000
20
<PAGE>
CUNO INCORPORATED
400 Research Parkway
Meriden, Connecticut 06450
PROXY
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR
THE ANNUAL MEETING OF STOCKHOLDERS, MARCH 23, 2000
The undersigned hereby appoints Mark G. Kachur, Frederick C. Flynn, Jr. and
Timothy B. Carney, and each or any of them, attorneys and proxies with full
power of substitution, to represent the undersigned and to vote all shares of
stock of CUNO Incorporated which the undersigned is entitled to vote at the
Annual Meeting of Stockholders of CUNO Incorporated to be held at the Raddison
Hotel & Conference Center, 100 Berlin Road, Cromwell, Connecticut, on Thursday,
March 23, 2000, at 10:00 a.m., or any adjournments or postponements thereof,
upon all matters as set forth in the Notice of Annual Meeting and Proxy
Statement, receipt of which is hereby acknowledged.
(Continued and to be signed and dated on other side)
FOLD AND DETACH HERE
- -------------------------------------------------------------------------------
[LOGO]
Annual Meeting
of
Stockholders
of
CUNO INCORPORATED
March 23, 2000
at
Radisson Hotel & Conference Center
100 Berlin Road, Cromwell, Connecticut
Beginning at 10:00 a.m.
(See map on reverse side)
<PAGE>
Please mark your votes as
indicated in this example. [X]
<TABLE>
<S> <C>
1. ELECTION OF DIRECTORS 2. RATIFY SELECTION OF ERNST & YOUNG LLP AS
Nominees: Joel B. Alvord, Charles L. Cooney, and John M. Galvin INDEPENDENT AUDITORS
FOR all nominees listed above WITHHOLD AUTHORITY The Board of Directors recommends
(except as listed to the contrary below) to vote for all nominees listed a vote FOR the approval of the auditors.
FOR AGAINST ABSTAIN
[_] [_] [_] [_] [_]
The Board of Directors recommends a vote FOR the election 3. IN THEIR DISCRETION, THE PROXIES ARE
of all the nominees as directors. If you wish to withhold authority AUTHORIZED TO VOTE UPON SUCH OTHER
to vote for any individual nominee, write that nominee's name BUSINESS AS MAY PROPERLY COME BEFORE THE
in the space provided below. MEETING OR ANY ADJOURNMENTS OR
POSTPONEMENTS THEREOF.
</TABLE>
___________________________________
THIS PROXY WILL BE VOTED AS DIRECTED ABOVE, OR IF RETURNED EXECUTED WITH NO
DIRECTION GIVEN, WILL BE VOTED FOR THE ELECTION OF ALL OF THE NOMINEES AS
DIRECTORS, AND FOR RATIFICATION OF ERNST & YOUNG LLP AS AUDITORS.
<TABLE>
<S> <C>
THIS PROXY SHOULD BE SIGNED EXACTLY AS NAME APPEARS HEREON PLEASE SIGN, DATE AND RETURN PROMPTLY
Executors, administrators, trustees, attorneys, etc., should IN ENCLOSED ENVELOPE
give full title as such. If the signer is a corporation or
partnership, please sign full corporate or partnership name by duly authorized
officer.
Dated: ___________________, 2000
_____________________________________
_____________________________________
Signature of Stockholder(s)
</TABLE>
- -----------------------------------------------------------------------------
FOLD AND DETACH HERE
CUNO encourages you to take advantage of new and convenient ways by which you
can vote your shares on matters to be covered at the Annual Meeting of
Stockholders. Please take the opportunity to use one of the three voting methods
outlined below to cast your ballot.
TO VOTE OVER THE INTERNET:
. Have your proxy card in hand when you access the web site.
. Log onto the Internet and go to the web site
http://www.eproxyvote.com/cuno, 24 hours a day. 7 days a week.
. You will be prompted to enter your control number printed in the
box above.
. Follow the instructions provided.
TO VOTE OVER THE TELEPHONE:
. Have your proxy card in hand when you call.
. On a touch-tone telephone call 1-877-PRX-VOTE (1-877-779-8683).
24 hours a day, 7 days a week. Outside the U.S. call 1-201-536-8073.
. You will be prompted to enter your control number printed in the box above.
. Follow the recorded instructions.
TO VOTE BY MAIL:
. Mark, sign and date your proxy card.
. Return your proxy card in the postage-paid envelope provided.
Your electronic vote authorizes the named proxies in the same manner as if you
signed, dated and returned the proxy card. If you choose to vote your shares
electronically, there is no need for you to mail back your proxy card.
[MAP APPEARS HERE]
Directions to the Radisson
Traveling North: Interstate 91 N to exit 21. Turn left. Traveling South:
Interstate 91 S to exit 21. Turn left.
Or
Traveling East: 1-84 to Exit 27 to Route 691 E (Meriden/Middletown) to 1-91 N.
Take exit 21. Turn left. Traveling West: 1-84 to Hartford Interchange to 1-91S
to exit 21. Turn left.
