<PAGE>
SCHEDULE 14A INFORMATION
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
DANAHER CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
DANAHER CORPORATION
1250 24th Street, N.W.
Washington, D.C. 20037
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 4, 1999
To the Shareholders:
Notice is hereby given that the 1999 Annual Meeting of Shareholders of
Danaher Corporation, a Delaware corporation (the "Company"), will be held at
the Washington Monarch Hotel, 2401 M Street, NW, Washington, D.C. 20037, on
May 4, 1999 at 2:00 p.m., local time, for the following purposes:
1. To elect three Directors to hold office for a term of three years and
until their successors are elected and qualified.
2. To approve the appointment of Arthur Andersen LLP as the Company's
independent auditors for the year ending December 31, 1999.
3. 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 19, 1999 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, 1999
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.
1
<PAGE>
PROXY STATEMENT
DANAHER CORPORATION
1250 24th Street, N.W.
Washington, D.C. 20037
(202) 828-0850
1999 ANNUAL MEETING OF SHAREHOLDERS
MAY 4, 1999
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 1999 Annual Meeting of Shareholders
("Annual Meeting") to be held at the Washington Monarch Hotel on May 4, 1999
at 2:00 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, 1999. The
purpose of the meeting is to elect three directors of the Company; to approve
the appointment of Arthur Andersen LLP as the Company's independent auditors
for the current year; 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 19, 1999 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 19, 1999, the record date for determining the shareholders of the
Company entitled to vote at the Annual Meeting, 135,345,836 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 directors 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.
1
<PAGE>
Abstentions and "broker non-votes" are counted as present in determining
whether the quorum requirement is satisfied. 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.
BENEFICIAL OWNERSHIP OF COMPANY COMMON STOCK BY
DIRECTORS, OFFICERS AND PRINCIPAL SHAREHOLDERS
As of March 19, 1999, the beneficial ownership of Company Common Stock by
directors and the nominees for director, by each of the executive officers
named in the Summary Compensation Table, by any principal shareholders
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:
<TABLE>
<CAPTION>
Number of Shares Percent
Name Beneficially Owned** Of Class
---- -------------------- --------
<S> <C> <C>
Mortimer M. Caplin..................... 193,748 (9) *
George M. Sherman...................... 2,342,596 (4) 1.9%
Donald J. Ehrlich...................... 58,000 (7) *
Walter G. Lohr, Jr..................... 166,000 (8) *
Mitchell P. Rales...................... 45,216,406 (1) 33.4%
Steven M. Rales........................ 45,216,406 (1) 33.4%
H. Lawrence Culp, Jr................... 117,736 (5) *
Patrick W. Allender.................... 548,000 (6) *
James H. Ditkoff....................... 315,554 (3) *
A. Emmet Stephenson, Jr................ 210,120 (2) *
Steven E. Simms........................ 87,553 (10) *
FMR Corp............................... 7,260,000 (11) 5.4%
All executive officers and directors as
a group (includes 17 persons)......... 50,012,937 (1)(2)(12) 37.0%
</TABLE>
- --------
(1) The aggregate holdings for Steven and Mitchell Rales include (i) all of
the 40,064,888 shares of Company Common Stock owned by Equity Group
Holdings LLC and Equity Group Holdings II LLC, of which Steven Rales and
Mitchell Rales are the only members, and (ii) 2,578,952 and 2,572,566
shares of Company Common Stock owned directly or through the Danaher
401(k) Plan by Steven Rales and Mitchell Rales, respectively. Steven and
Mitchell Rales each disclaim beneficial ownership of those shares of
Company Common Stock that are owned directly or through the Danaher
401(k) Plan by the other. Their business address, and that of Equity
Group Holdings LLC and Equity Group Holdings II LLC, is 1250 24th Street,
N.W., Washington, D.C. 20037.
(2) Includes 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. Mr. Stephenson has the option to acquire 18,000
shares of Company stock.
(3) Mr. Ditkoff has the option to acquire 95,200 shares of Company Common
Stock.
(4) Mr. Sherman has the option to acquire 2,000,000 shares of Company Common
Stock. Includes shares held by Sherman Investors Limited Partnership, a
partnership for the benefit of his family. Mr. Sherman controls the
general partner.
(5) Mr. Culp has the option to acquire 116,800 shares of Company Common
Stock.
(6) Mr. Allender has the option to acquire 362,000 shares of Company Common
Stock.
(7) Mr. Ehrlich has the option to acquire 18,000 shares of Company Common
Stock.
(8) Mr. Lohr has the option to acquire 18,000 shares of Company Common Stock.
(9) Mr. Caplin has the option to acquire 10,000 shares of Company Common
Stock.
2
<PAGE>
(10) Mr. Simms has the option to acquire 85,600 shares of Company Common
Stock.
(11) FMR Corp.'s address is 82 Devonshire Street, Boston, MA 02109.
(12) Includes 3,344,160 shares underlying options exercisable within 60 days.
* Represents less than 1% of the outstanding Company Common Stock.
** All options are exercisable within 60 days and shares underlying such
options are included in the table.
Apart from Steven M. Rales, Mitchell P. Rales and FMR Corp., 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 1999 Annual Meeting of Shareholders,
shareholders will elect three directors to serve until the 2002 Annual Meeting
of Shareholders and until their successors are duly elected and qualified. The
Board of Directors has nominated Messrs. Mitchell P. Rales, George M. Sherman
and A. Emmet Stephenson, Jr. to serve as directors in the class whose term
expires in 2002. 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 2000. Mr. Steven M. Rales will continue to serve as a director until his
term expires in 2001.
The names of the nominees 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 a nominee 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.
Nominees For Election At This Year's Annual Meeting To Serve In The Class
Whose Term Expires In 2002
<TABLE>
<CAPTION>
Director Term
Name Age Principal Occupation Since Expires
---- --- -------------------- -------- -------
<C> <C> <S> <C> <C>
Mitchell P. Rales (b,d)....... 42 Chairman of the 1983 2002
Executive Committee of
the Company since 1990;
during the past five
years he has been a
principal in a number of
private business
entities with interests
in manufacturing
companies, media
operations and publicly
traded securities;
Director of Imo
Industries Inc.
George M. Sherman (d)......... 57 President and Chief 1990 2002
Executive Officer of the
Company since 1990;
Director of Campbell
Soup Company.
A. Emmet Stephenson, Jr. (a).. 53 President of Stephenson 1986 2002
and Co., a private
investment firm in
Denver, Colorado for
more than five years;
Chairman of StarTek,
Inc. for more than five
years.
</TABLE>
Current Directors Whose Term Will Continue After This Meeting
<TABLE>
<CAPTION>
Director Term
Name Age Principal Occupation Since Expires
---- --- -------------------- -------- -------
<C> <C> <S> <C> <C>
Mortimer M. Caplin (a,c).. 82 Senior Member of Caplin & 1990 2000
Drysdale, a law firm in
Washington, D.C., for over
five years; Director of
Fairchild Corporation and
Presidential Realty
Corporation.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
Director Term
Name Age Principal Occupation Since Expires
---- --- -------------------- -------- -------
<C> <C> <S> <C> <C>
Donald J. Ehrlich (a,c).. 61 President, Chairman and Chief 1985 2000
Executive Officer of Wabash
National Corp. for over five
years; Director of Indiana
Secondary Market for
Educational Loans, Inc. and
INB National Bank, N.W.
Walter G. Lohr, Jr. (c).. 55 Partner of Hogan & Hartson, a 1983 2000
law firm in Baltimore,
Maryland, for over five years
Steven M. Rales (b,d).... 47 Chairman of the Board of the 1983 2001
Company since 1984; during
the past five years he has
been a principal in a number
of private business entities
with interests in
manufacturing companies,
media operations and publicly
traded securities. Director
of Imo Industries Inc.
</TABLE>
- --------
(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.
(d) Member of the Executive Committee of the Board of Directors.
THE BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD
The Board of Directors had a total of four meetings during 1998. 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 1998.
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 two times in 1998.
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 1998.
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 1998.
The Company has no Nominating Committee of its Board of Directors.
EXECUTIVE OFFICERS OF THE REGISTRANT
Executive Officers of the Company are:
<TABLE>
<CAPTION>
Officer
Name Age Position Since
---- --- -------- -------
<C> <C> <S> <C>
Steven M. Rales...... 47 Chairman of the Board 1984
Mitchell P. Rales.... 42 Chairman of the Executive Committee 1984
Chief Executive Officer, President and
George M. Sherman.... 57 Director 1990
Senior Vice President, Chief Financial
Patrick W. Allender.. 52 Officer and Secretary 1987
James H. Ditkoff..... 53 Vice President-Finance and Tax 1991
Dennis D. Claramunt.. 53 Vice President and Group Executive 1994
</TABLE>
4
<PAGE>
<TABLE>
<S> <C> <C> <C>
C. Scott Brannan.......... 40 Vice President-Administration and Controller 1987
John P. Watson............ 54 Vice President and Group Executive 1993
H. Lawrence Culp, Jr...... 35 Vice President and Group Executive 1995
Daniel L. Comas........... 34 Vice President-Corporate Development 1996
Steven E. Simms........... 43 Vice President and Group Executive 1996
Mark C. DeLuzio........... 41 Vice President-Danaher Business System 1996
Dennis A. Longo........... 42 Vice President-Human Resources 1997
</TABLE>
Steven M. Rales has served as Chairman of the Board since January 1984. In
addition, during the past five years he has been a principal in a number of
private business entities with interests in manufacturing companies, media
operations and publicly traded securities. He is also a director of Imo
Industries Inc.
Mitchell P. Rales has served as a director of the Company since January
1984. In addition, during the past five years he has been a principal in a
number of private business entities with interests in manufacturing companies,
media operations and publicly traded securities. He is also a director of Imo
Industries Inc.
George M. Sherman has served as President and Chief Executive Officer and a
director of the Company since February 1990. He is also a director of Campbell
Soup Company.
Patrick W. Allender has served as Chief Financial Officer of the Company
since March, 1987.
James H. Ditkoff has served as Vice President-Finance and Tax since January,
1991.
Dennis D. Claramunt was appointed Vice President and Group Executive in 1994
and has served in general management positions within the Company for more
than the 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 since September, 1990.
H. Lawrence Culp, Jr. was appointed Vice President and Group Executive in
1995. He has served in general management positions within the Company for
more than the past five years.
Daniel L. Comas was appointed Vice President-Corporate Development in 1996.
He has served the Company in an executive capacity in the corporate
development area for more than the past five years.
Steven E. Simms was appointed Vice President and Group Executive in 1996. He
had previously served Black & Decker, most recently as President-Worldwide
Accessories Business.
Mark C. DeLuzio was appointed Vice President-Danaher Business Systems (DBS)
in 1996. He has served the Company as Director-DBS and in financial and
operating positions with Jacobs Vehicle Systems, Inc. for more than the past
five years.
Dennis A. Longo was appointed Vice President-Human Resources in 1997. He has
served the Company as a human resources executive for more than the past five
years.
5
<PAGE>
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 executive officers of the Company who, in addition to the
Chief Executive Officer, received the highest compensation during 1998.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long-term
Annual Compensation Compensation Awards
- ------------------------------------------------------------ ---------------------
(e) (f) (g)
(a) Other Restricted Securities (h)
Name and (c) (d) Annual Stock Underlying All Other
Principal (b) Salary Bonus Compensation Awards (1) Options Compensation (2)
Position Year ($) ($) ($) ($) (#) ($)
--------- ---- ------- --------- ------------ ---------- ---------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
George M. Sherman....... 1998 675,000 1,625,000 -- -- -- $87,000
President and CEO 1997 675,000 1,457,500 -- -- 1,200,000 61,000
1996 675,000 859,000 -- -- -- 63,000
Patrick W. Allender..... 1998 317,000 380,000 -- -- -- 22,000
Senior Vice President 1997 296,000 325,000 -- -- 200,000 22,000
and CFO 1996 270,833 260,000 -- -- 50,000 14,000
Steven E. Simms......... 1998 298,000 240,000 -- -- -- 22,000
Vice President and 1997 280,000 200,000 -- -- 170,000 22,000
Group Executive 1996 210,000 160,000 -- -- 214,000 --
H. Lawrence Culp, Jr.... 1998 264,000 232,000 -- -- -- 22,000
Vice President and 1997 217,000 180,000 -- -- 170,000 22,000
Group Executive 1996 192,000 170,000 -- -- 30,000 14,000
James H. Ditkoff........ 1998 213,000 195,000 -- -- 7,500 22,000
Vice President-- 1997 204,000 175,000 -- -- 12,000 22,000
Finance and Tax 1996 196,000 145,000 -- -- 8,000 14,000
</TABLE>
- --------
(1) Mr. Sherman received a grant of 800,000 shares in 1990; 400,000 have been
issued and 400,000 are deferred until retirement. Issued shares
participate in dividends ($22,000 in 1998, $20,000 in 1997 and $18,000 in
1996) on a non-preferential basis. The value of the 800,000 shares at
December 31, 1998 was $43,450,000.
(2) Includes contributions to the Company's 401(k) and executive retirement
plans and financial consulting fees for all individuals; in the case of
Mr. Sherman, it also includes supplemental term life insurance ($19,000
for 1998) and financial consulting fees ($46,000 for 1998).
6
<PAGE>
Grants in Last Fiscal Year
The following table sets forth certain information relating to options
granted to purchase shares of the Company Common Stock.
<TABLE>
<CAPTION>
Potential Realizable Value at
Assumed Annual Rates of
Stock Price Appreciation for
Individual Grants Option Term (3)
--------------------------------------------------- --------------------------------
(b) (c)
No. of Securities % of Total (d)
underlying Options Exercise
Options/SARS Granted to or Base (e)
(a) Granted Employees in Price Expiration (f) (g) (h)
Name (#) (1) Fiscal Year ($/Sh)(2) Date 0%($ ) 5%($) 10%($)
---- ----------------- ------------ --------- ---------- -------------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
James H. Ditkoff........ 7,500 0.6% 45.375 12-1-08 0 214,000 540,000
</TABLE>
- --------
(1) Options become exercisable ratably over five years.
(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.
7
<PAGE>
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 1998
for the executive officers whose compensation is reported in the Summary
Compensation Table. Value is considered to be, in the case of unexercised
options, the difference between the exercise price and the market price at
December 31, 1998.
<TABLE>
<CAPTION>
Number of
Securities
Underlying Value of Unexercised
Shares Unexercised Options In-the-Money Options
Acquired Value at FY-End (#) at FY-End($)
on Exercise Realized Exercisable/ Exercisable/
Name # $ Unexercisable Unexercisable
---- ----------- --------- ------------------- ---------------------
<S> <C> <C> <C> <C> <C> <C>
George M. Sherman....... -0- -0- 2,000,000 1,800,000(1) 99,400,000 62,550,000
H. Lawrence Culp, Jr.... 8,000 314,000 116,800 207,200 5,029,000 6,506,000
Patrick W. Allender..... -0- -0- 362,000 258,000 16,454,000 8,194,000
James H. Ditkoff........ 68,000 2,641,000 95,200 28,300 4,413,000 710,000
Steven E. Simms......... -0- -0- 85,600 298,400 3,094,000 9,816,000
</TABLE>
- --------
(1) Includes options to acquire 80,000 shares transferred in trust to family
members. Mr. Sherman disclaims beneficial ownership of these options.
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. A grant of an option to acquire 2,000 shares of
Company Common Stock at $45.375 (fair market value at date of grant) per share
was made to these directors.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT
Pursuant to the terms of termination agreements between the Company and
Messrs. Sherman and 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 Mr. Watson's salary and benefits
would continue for an additional 12 months. See "Report of the Compensation
Committee of the Board of Directors on Executive Compensation" for further
discussion of Mr. Sherman's contract.
COMPENSATION COMMITTEE
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, they do not participate in deliberations
regarding their own compensation. The members of the Compensation Committee
are A. Emmet Stephenson, 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 Securities Exchange Act of
1934.
8
<PAGE>
Total executive officer compensation is comprised of three principal
components: annual salary, annual incentive compensation, and grants of
options to purchase Company Common Stock. In the case of Mr. Sherman, this
included a restricted stock grant at the time of his hire. The Committee
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 his
relationship to other executive positions within the Company, as negotiated at
the date of hire. This base is then adjusted annually based on the Committee's
assessment of individual performance.
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), working capital management (working capital turnover) and
economic value added. 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.
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 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 previously
granted to the employee. Thus the compensation value of this element is
directly related to the performance of the Company as measured by its returns
to shareholders 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. 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. He also received 800,000 shares of
restricted stock (see Summary Compensation Table) and an option to acquire
2,000,000 shares (see Year End Option Value Table) of the Company Common
Stock, and has received, or will receive, tax gross-up payments related to
these items. 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 Committee evaluated each executive's annual incentive compensation
awards for 1998. The Committee assessed their performance in light of the
targets referenced above, which were substantially exceeded, and awarded total
incentive compensation payments to executives other than Group Executives of
$2,610,000 for 1998. For the years 1999-2002, the Committee has established a
maximum bonus payment of up to $2,500,000 per executive. The Company's
shareholders approved the performance goals for these periods, which are
applicable to all of the Company's executive officers, other than Group
Executives, at the 1998 annual meeting.
The Committee has considered the impact of 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.
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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 designed the program for awarding 1998-2002 incentive
compensation to executive officers other than Group Executives so that such
bonuses will comply with an exception to the $1 million deduction limit for
performance-based compensation. Accordingly, the full amount of any such bonus
payments for 1998-2002 should be deductible. One of the requirements of this
exception is that shareholders approve certain material terms under which the
bonus is to be paid. In this regard, the Company's shareholders approved the
material terms used for calculating the 1998-2002 bonus awards for the
Company's executive officers, other than Group Executives, at the 1998 annual
meeting.
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
A. Emmet Stephenson, Jr.
Mortimer M. Caplin
Donald J. Ehrlich
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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, 1998 with the cumulative total return on the S&P 500 Index
(the equity index) and the S&P Manufacturing Index (the peer index). The
comparison assumes $100 was invested on December 31, 1993 in the Company's
Common Stock and in each of the above indices with reinvestment of dividends.
[LINE GRAPH APPEARS HERE]
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 member, and from the firm of Hogan & Hartson, of which Mr. Lohr, a
Director, is a partner. The amount of such fees for 1998 was less than five-
percent of each firm's gross revenues. These transactions, which are conducted
on an arms length basis, are not material, either individually or in the
aggregate.
PROPOSAL 2.
APPROVAL OF APPOINTMENT OF AUDITORS
The Board of Directors has appointed Arthur Andersen LLP, an international
accounting firm of independent certified public accountants, to act as
independent accountants for the Company and its consolidated subsidiaries for
1999. Arthur Andersen LLP has been the Company's auditors since 1976 and has
advised the
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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 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 LLP TO SERVE AS INDEPENDENT AUDITORS FOR THE COMPANY FOR 1999.
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 2000 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 26, 1999 for inclusion in the Proxy
Statement and Proxy relating to the 2000 Annual Meeting of Shareholders.
Shareholder proposals submitted other than pursuant to Rule 14(a)-8 under the
Securities Exchange Act are considered untimely if received after February 13,
2000.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Patrick W. Allender
PATRICK W. ALLENDER
Secretary
Dated: March 30, 1999
COPIES OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED
DECEMBER 31, 1998 MAY BE OBTAINED, WITHOUT CHARGE, BY WRITING TO THE COMPANY.
12
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DANAHER CORPORATION
PROXY FOR 1999
ANNUAL MEETING OF SHAREHOLDERS--MAY 4, 1999
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, 1999, 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
4, 1999, 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 and 3. PLEASE
SIGN AND DATE ON THE REVERSE SIDE.
1. ELECTION OF DIRECTORS
Nominee Messrs. Mitchell P. Rales, George
M. Sherman and A. Emmet Stephenson, Jr. to
serve as directors with a term expiring in
2002.
To withhold authority to vote for an
WITHHOLD individual Nominee, write that Nominee's
AUTHORITY name on the line below.
FOR all Nominees for all Nominees
[_] [_] ------------------------------------------
2. APPROVAL OF APPOINTMENT OF AUDITORS
[_] For [_] Against [_] Abstain
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<PAGE>
- --------------------------------------------------------------------------------
[_] For [_] Against [_] Abstain
3. IN THEIR DISCRETION on any other matter which may properly come before the
meeting, including any adjournment thereof.
Dated: __________________ , 1999
________________________________
________________________________
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 [_] IN BLUE OR BLACK INK
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<PAGE>
COMMON STOCK
OF INTERMET CORPORATION
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
FOR THE 1999 ANNUAL MEETING OF SHAREHOLDERS
The undersigned hereby appoints John Doddridge and Doretha J. Christoph; or
either of them with power of substitution in each, the proxies of the
undersigned to vote the Common Stock of the undersigned at the Annual Meeting
of Shareholders of INTERMET CORPORATION (the "Company") to be held on April 15,
1999, and any adjournment thereof.
1. Election of directors
John Doddridge; John P. Crecine; Norman F. Ehlers; A. Wayne Hardy; John R.
Horne; Thomas H. Jeffs, II; Harold C. McKenzie, Jr.; Byron O. Pond, Jr.;
John H. Reed.
[X] FOR all nominees for director listed above
[_] WITHHOLD AUTHORITY to vote for all nominees listed above.
INSTRUCTION: To withhold authority to vote for any individual nominee write
that nominee's name on the space provided below.
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2. Appointment of Ernst & Young LLP as the independent auditors of the Company
for 1999.
[X] FOR [_] AGAINST [_] ABSTAIN
3. In accordance with their best judgment with respect to any other matters
that may properly come before the meeting.
<PAGE>
THE BOARD OF DIRECTORS FAVORS A VOTE "FOR" THE ELECTION AS DIRECTORS OF THE
PERSONS NAMED IN THE PROXY, AND "FOR" APPOINTMENT OF THE INDEPENDENT AUDITORS,
AND, UNLESS INSTRUCTIONS TO THE CONTRARY ARE INDICATED IN THE SPACE PROVIDED,
THIS PROXY WILL BE SO VOTED.
Please sign this Proxy exactly as
name appears on the Proxy.
-------------------------------------
Note: When signing as an attorney,
trustee, administrator or guardian,
please give your title as such. In
the case of joint tenants, each
joint owner must sign.
Date: _______________________________
