February 13, 1995
Securities and Exchange Commission
Division of Corporation Finance
450 Fifth Street, N.W.
Judiciary Plaza
Washington, D.C. 20549
Dear Sir or Madam:
RE: EG&G, Inc., 1995 Preliminary Proxy Material EG&G, Inc. File
01-5075
Pursuant to Rule 14a-6 of the Securities Exchange Act of 1934,
attached is a preliminary copy of EG&G's 1995 proxy material. This
consists of a Notice of Annual Meeting, a Proxy Statement, and a Proxy
Card, all of which pertain to the Annual Meeting of Stockholders to be
held on Tuesday, April 25, 1995. The requisite filing fee of $125 was
previously sent by wire transfer.
We expect to mail definitive proxy material to our stockholders on
or about March 7, 1995 and definitive copies of our proxy material will
be mailed to the SEC on that date.
As you will notice, the preliminary Proxy Statement does not
contain the names and biographies of three of the five candidates
nominated for election to the EG&G Board. The Nominating Committee is
in the process of making final selection of these nominees and
therefore, at this time, the information is not available. I have
recently discussed this matter with the Securities and Exchange
Commission, and I have been advised that this should not delay the date
on which these materials are deemed filed with the SEC.
We would appreciate your earliest action on the enclosed material and
would be most appreciative for your advice by telephone, if convenient.
Please feel free to call the
undersigned collect at (617) 431-4136 or Murray Gross, EG&G's Vice
President and General Counsel at (617) 431-4135.
Very truly yours,
Donna W. Economou
Senior Attorney
DWE/jp
Enclosures<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act
of 1934
Filed by Registrant [x]
Filed by a Party other than the Registrant[]
Check the appropriate box:
[x] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
EG&G, Inc.
............................................................
(Name of Registrant as Specified In Its Charter)
Murray Gross, Vice President & General Counsel
............................................................
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[x] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
1) Title of each class of securities to which transaction applies:
............................................................
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: 1
............................................................
<PAGE>
4) Proposed maximum aggregate value of transaction:
............................................................
1. Set forth the amount on which the filing fee is calculated and state
how it was determined.
[] 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:
............................................................
<PAGE>
NOTICE OF ANNUAL MEETING
To the Stockholders of EG&G, Inc.:
The Annual Meeting of the Stockholders of EG&G, Inc., will be held
at the Sheraton Needham Hotel, 100 Cabot Street, Needham, Massachusetts,
on Tuesday, April 25, 1995, at 10:30 a.m., to consider and act upon the
following:
1. A proposal to fix the number of Directors at thirteen and to elect
five nominees for Director for terms of three years each; and
2. A proposal to amend the Articles of Organization of the Company to
provide for the declassification of the Board of Directors, such
declassification to commence with the Annual Meeting of Stockholders in
1996; and
3. Such other matters, including one stockholder proposal, as may
properly come before the Meeting or any adjournment thereof.
The Board of Directors has no knowledge of any other business to
be transacted at the Meeting.
The Board of Directors has fixed the close of business on February
24, 1995, as the record date for the determination of stockholders
entitled to receive this notice and to vote at the Meeting.
All stockholders are cordially invited to attend the Meeting.
By Order of the Board of Directors
MURRAY GROSS, Clerk
March 7, 1995
- ------------------------------------------------------------
RETURN ENCLOSED PROXY CARD
Whether or not you expect to attend this Meeting, I urge you to
complete, date, and sign the enclosed proxy card and to mail it promptly
in the enclosed envelope. No postage is required if mailed in the
United States. Prompt response is important and your cooperation will
be appreciated. If the envelope is lost, return the card to The First
National Bank of Boston, Shareholder Services Division, Post Office Box
1459, Boston, Massachusetts 02104-9904.
<PAGE>
NOTICE OF ANNUAL MEETING
AND
PROXY STATEMENT 1995
EG&G, INC., CORPORATE OFFICES, 45 WILLIAM STREET, WELLESLEY,
MASSACHUSETTS 02181
<PAGE>
PROXY STATEMENT
This Proxy Statement has been prepared to provide the stockholders
of EG&G, Inc. with information pertaining to the matters to be voted on
at the EG&G, Inc., Annual Meeting of Stockholders to be held on Tuesday,
April 25, 1995 at 10:30 a.m., at the Sheraton Needham Hotel, 100 Cabot
Street, Needham, Massachusetts, and at any adjournment of that Meeting.
The date of this Proxy Statement is March 7, 1995, the approximate date
on which the Proxy Statement and form of Proxy were first sent or given
to stockholders. EG&G, Inc. is sometimes referred to in this Proxy
Statement as "EG&G" or the "Company." EG&G, Inc. Common Stock, $1 par
value (the only outstanding EG&G security with voting power), is
referred to as the "Common Stock."
This proxy is solicited on behalf of the Board of Directors of
EG&G. You are requested to sign and return your proxy card promptly.
You have the right to revoke your proxy and change your vote at any time
prior to its exercise at the Meeting by filing written notice with the
Clerk of EG&G or by signing and delivering a new proxy card bearing a
later date. It is important to sign and return your proxy card. It
helps to establish a quorum so that the Meeting may be held, and it
permits your votes to be cast in accordance with your directions.
The expenses connected with soliciting proxies will be borne by
EG&G. The Company expects to pay brokers, nominees, fiduciaries, and
other custodians their reasonable expenses for forwarding proxy
materials and annual reports to principals and obtaining their voting
instructions. Due to the limited time available for the solicitation of
proxies, the Company has engaged Kissel-Blake Inc., of New York City, to
assist in soliciting proxies from brokers, nominees, fiduciaries, and
custodians and has agreed to pay Kissel-Blake Inc., $6,500 and
out-of-pocket expenses for such efforts. In addition to the use of the
mails, certain Directors, officers, and employees may solicit proxies in
person or by use of communications media.
The stock transfer books of EG&G will not be closed; however, the
Board of Directors has fixed the close of business on February 24, 1995,
as the record date for determining the stockholders entitled to receive
notice and to vote their shares at the Annual Meeting. On the record
date, there were _________ shares of Common Stock outstanding and
entitled to vote. Each share of Common Stock carries with it the right
to cast one vote, with no cumulative voting. A majority of issued and
outstanding shares constitutes a quorum.
The three items to be acted upon by the stockholders are set forth
on your proxy card and each of them is discussed in detail on the
following pages. Shares represented by proxy will be voted at the
Meeting in accordance with your instructions, as indicated on the proxy
card.
<PAGE>
The first item on the proxy card is a proposal to fix the number
of Directors at thirteen and to elect five Directors for terms of three
years each. You are provided the opportunity to vote your shares for
granting, or withholding, authority to fix the number of Directors at
thirteen and to elect the five nominees as a group by marking the
interior of the appropriate box on the proxy card. Should you desire to
withhold authority to vote for specific nominees, please identify the
exceptions in the appropriate space provided on the proxy card. Your
shares will be voted as you indicate. If you sign and return your proxy
card and make no indication concerning Item No. 1 on the proxy card,
your shares will be voted "For" fixing the number of Directors at
thirteen and electing the nominees named in this Proxy Statement.
The second item is a proposal to amend Article 6 of the Company's
Articles of Organization to provide for the declassification of the
Board of Directors, such declassification to commence with the Annual
Meeting of Stockholders in 1996.
The third item is a stockholder proposal to recommend that all
future non-employee directors not be granted pension benefits and that
current non-employee directors voluntarily relinquish their pension
benefits.
With respect to Item Nos. 2 and 3, you are provided the
opportunity to vote for or against adopting the proposals or to abstain
from voting. Your shares will be voted as you indicate; or not voted if
you elect to abstain. If you do not make an indication concerning these
items, your shares will be voted "For" Item No. 2 and "Against" Item No.
3.
Management does not anticipate a vote on any other proposal at the
Annual Meeting. In the event, however, that another proposal is
properly brought before the Meeting, your shares will be voted in
accordance with management's discretion.
EG&G's Annual Report to Stockholders for 1994 has already been
mailed to its stockholders or is enclosed herewith. It should not be
considered either as part of this Proxy Statement or as incorporated
herein by reference.
<PAGE>
Votes Required
The affirmative vote of the holders of a plurality of the votes
cast at the Meeting is required for the election of Directors. The
affirmative vote of the holders of two-thirds of the shares of Common
Stock issued and outstanding and entitled to vote is required for the
proposal to declassify the Board of Directors. The affirmative vote of
the holders of a majority of the shares of Common Stock present or
represented at the Meeting is required for the approval of the
stockholder proposal to be voted upon.
Shares of Common Stock represented by executed proxies received by
the Company will be counted for purposes of establishing a quorum at the
Meeting, regardless of how or whether such shares are voted on any
specific proposal. With respect to the required vote on any particular
matter, abstentions and votes withheld by nominee recordholders who did
not receive specific instructions from the beneficial owners of such
shares will not be treated as votes cast or as shares present or
represented and voting.
Item No. 1
ELECTION OF DIRECTORS
The Articles of Organization and By-Laws of EG&G provide that the
number of Directors, not less than three nor more than thirteen, shall
be fixed by the stockholders and that approximately one-third of the
Directors shall be elected each year for terms of three years each.
There are, at present, eleven Directors of the Company. The terms of
three of the Directors expire at this year's Annual Meeting; the terms
of five other Directors expire at the Annual Meeting in 1996; and the
terms of the remaining three Directors expire at the Annual Meeting in
1997. Mr. Dean Freed has announced that he will retire from the Board
following the expiration of his term at this year's Annual Meeting. Mr.
Joseph Turley has announced that he will retire from the Board in June
1995.
The Board of Directors has declared it advisable that the number
of Directors be fixed at thirteen and has nominated the following
persons, two of whom are currently serving as Directors of the Company,
for election as Directors for three-year terms expiring at the Annual
Meeting in 1998:
John M. Kucharski
John B. Gray
_____________
_____________
_____________
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" FIXING THE NUMBER OF
DIRECTORS AT THIRTEEN AND FOR ELECTING THE FIVE NOMINEES NAMED ABOVE FOR
TERMS OF THREE YEARS EACH.
<PAGE>
It is intended that the shares represented by proxies will be
voted to fix the number of Directors at thirteen and for the election of
the five nominees (unless one or more of the nominees is unwilling or
unable to serve) for terms of three years each, unless a contrary vote
is indicated on the proxy cards. The Board of Directors knows of no
reason why any nominee should be unable or unwilling to serve, but if
such should be the case, the persons named as proxies in the Proxy may
vote for the election of a substitute. In no event will shares
represented by proxies be voted for more than five nominees. To apprise
you of the qualifications of the Directors, we are including information
concerning the nominees and the eight incumbent Directors whose terms of
office expire in 1996 or 1997.
Nominees for Director for a three-year term expiring in 1998
JOHN M. KUCHARSKI: Age 59; Principal Occupation: Chairman of the
Board, President and Chief Executive Officer of EG&G. Member of the
Board of Directors of EG&G since 1986. Member of the Executive
Committee of the Board of Directors.
John M. Kucharski is Chairman of the Board, President, and Chief
Executive Officer of EG&G. Mr. Kucharski joined the Company in 1972
when Challenger Research, Inc., a firm he co-founded in 1965,
specializing in research and analysis studies for the U.S. Navy, was
acquired by Hydrospace Research Corporation, an EG&G subsidiary. Mr.
Kucharski was subsequently named General Manager of the newly merged
company and later assumed responsibility for EG&G's Wolf Research and
Development Corporation, as well. In 1975, the three companies were
combined into a new corporation, EG&G Washington Analytical Services
Center, Inc., and Mr. Kucharski was appointed President and General
Manager. He was promoted to the position of Vice President of EG&G in
1979, and in 1982 was elected a Senior Vice President, assuming
responsibility for all of EG&G's government operations. He held this
position until his appointment as Executive Vice President in 1985. He
was promoted to the position of President and Chief Operating Officer in
1986, was named to the position of Chief Executive Officer in 1987, and
elected Chairman of the Board in 1988. Mr. Kucharski received a BS
degree in electrical engineering from Marquette University in 1958 and a
JD degree from George Washington University in 1965. He is a Director
of Nashua Corporation, New England Electric System, State Street Boston
Corporation and Eagle Industry Co., Ltd. Mr. Kucharski serves on the
Board of Trustees of Marquette University and George Washington
University.
<PAGE>
JOHN B. GRAY: Age 67; Principal Occupation: Former President and
Director of Dennison Manufacturing Company, a subsidiary of Avery
Dennison Corporation, a diversified manufacturer serving worldwide
markets for office products, industrial systems, packaging, and
pressure-sensitive base materials. Member of the Board of Directors of
EG&G since 1983. Chairman of the Benefit Plans Investment Committee and
a member of the Executive Committee and the Audit Committee of the Board
of Directors.
John B. Gray is a former President and Director of Dennison
Manufacturing Company. He joined Dennison Manufacturing Company in 1951
and, after working in a number of production and general management
positions, was elected a Vice President in 1968. He was elected Senior
Vice President of that Company in 1972 and in 1979 was appointed
Executive Vice President, a position he held until his appointment as
President in 1986. Mr. Gray retired from Dennison Manufacturing Company
in 1991. He served as a
Director of Dennison Manufacturing Company from 1968 to 1991. Mr. Gray
received an AB degree from Harvard University in 1949 and an MBA degree
from Harvard Business School in 1951. He also serves as a Director of
the Liberty Mutual Insurance Companies, the Stackpole Corporation, and
the New England Shelter for Homeless Veterans and is Board Chairman of
the Executive Service Corps of New England. Mr. Gray is a Trustee of
Wentworth Institute of Technology and the New England Aquarium as well
as an Incorporator of the Massachusetts General Hospital.
TO BE DETERMINED
[Three Nominees to the Board are in the process of being selected]
<PAGE>
Directors whose terms expire in 1996
SAMUEL RUBINOVITZ: Age 65; Principal Occupation: Retired Executive
Vice President of EG&G. Mr. Rubinovitz served as Executive Vice
President of EG&G from 1989 until his retirement from the Company in
January of 1994. He was Senior Vice President of EG&G in charge of the
Company's commercial operations from 1986 to 1989, and Vice President,
Electron Devices Group from 1979 to 1986. Mr. Rubinovitz joined EG&G,
Inc. in 1963 as Marketing Manager for the Electron Products Division and
served as General Manager of the Electro-Optics Division for the period
1970 through 1978. He was voted a Member of the Board of Directors in
1989 and is a Member of the Executive Committee and the Corporate
Governance Committee. He is a Director of Richardson Electronics Ltd.,
Chicago, Illinois; Kronos, Inc., Waltham, Massachusetts; KLA Instruments
Corporation, Santa Clara, California; and LTX Corporation, Westwood,
Massachusetts.
WILLIAM F. POUNDS: Age 67; Principal Occupation: Professor, Sloan
School of Management, Massachusetts Institute of Technology, Cambridge,
Massachusetts, since 1961. Dr. Pounds has been a Member of the EG&G
Board of Directors continuously since 1969 and is a Member of the
Compensation and Stock Option Committee and Chairman of the Corporate
Governance Committee of the Board of Directors. He is a member of the
American Academy of Arts and Sciences. Dr. Pounds also serves as a
Director of the Putnam Funds; the Sun Company, Inc.; M/A COM, Inc.;
Idexx Laboratories, Inc.; and Perseptive Biosystems, Inc. He is a
Trustee of the Museum of Fine Arts of Boston and an Overseer of WGBH
Educational Foundation.
ROBERT F. GOLDHAMMER: Age 64; Principal Occupation: Principal
shareholder of Concord International Partners, a merchant banking firm.
He has been a member of EG&G Board of Directors continuously since 1981
and is Chairman of the Audit Committee and a Member of the Benefit Plans
Investment Committee of the Board of Directors. Mr. Goldhammer served
as a Vice President and Vice Chairman of the Management Committee of
Kidder, Peabody & Co., Inc. from 1982 to 1986. Mr. Goldhammer is a
Director of Esterline Technologies and serves as Board Chairman of
ImClone Systems Incorporated.
G. ROBERT TOD: Age 55; Principal Occupation: President and Chief
Operating Officer and Director of the CML Group, Inc., a specialty
marketing company. He was elected a Member of the EG&G Board of
Directors in 1984 and is Chairman of the Compensation and Stock Option
Committee and a Member of the Nominating Committee of the Board of
Directors. Mr. Tod is co-founder of the CML Group, Inc. and has served
as its President and Chief Operating Officer from 1969 to the present.
Mr. Tod is a Director of SCI Systems, Inc., and is a Trustee of
Rensselaer Polytechnic Institute and of Emerson Hospital.
<PAGE>
GRETA E. MARSHALL, CFA: Age 57; Principal Occupation: Principal and
founder in 1988 of The Marshall Plan, a financial investment company
with offices in Boston, Massachusetts and Incline Village, Nevada. She
was elected a Member of the Board of Directors of EG&G in 1990 and is a
Member of the Compensation and Stock Option Committee and the Benefit
Plans Investment Committee of the Board of Directors. Ms. Marshall was
Director, Investments, Deere & Company, Moline, Illinois, from 1974 to
1984. She was President of Baybanks Investment Management, Boston,
Massachusetts, in 1984 and 1985 and Investment Manager of the California
Public Employees Retirement System from 1985 to 1988. Ms. Marshall is
a Member of the Editorial Board of CFA Digest and is a Trustee of the
AIMR Investment Management Workshop.
<PAGE>
Directors whose terms expire in 1997
JOSEPH F. TURLEY: Age 69; Principal Occupation: Retired President and
Chief Operating Officer, the Gillette Company. He has been a Member of
the EG&G Board of Directors continuously since 1977 and is a Member of
the Compensation and Stock Option Committee and the Benefit Plans
Investment Committee of the Board of Directors. Mr. Turley is a member
of the Boards of Directors of The Gillette Company, 16 investment
companies sponsored by New England Mutual Life Insurance Company, and
Copley Properties, Inc., Boston, Massachusetts. Active in civic
affairs, Mr. Turley serves on the Board of Directors of the South Boston
Neighborhood House.
KENT F. HANSEN: Age 63; Principal Occupation: Professor of Nuclear
Engineering at the Massachusetts Institute of Technology, Cambridge,
Massachusetts. He has been a Member of the EG&G Board of Directors
continuously since 1979 and is a Member of the Audit Committee, the
Nominating Committee, and the Corporate Governance Committee of the
Board of Directors. As a teacher, author, and consultant, Dr. Hansen
has been active in the areas of nuclear fuel management, nuclear reactor
physics, and reactor safety analysis. Dr. Hansen is a Director of Stone
& Webster, Inc. He is also a Member of the National Academy of
Engineering.
JOHN LARKIN THOMPSON: Age 64; Principal Occupation: Of Counsel to
Nutter, McClennen & Fish, a Boston, Massachusetts law firm. Mr.
Thompson became a Member of the EG&G Board of Directors in 1986 and is
Chairman of the Nominating Committee and a member of the Corporate
Governance Committee of the Board of Directors. Mr. Thompson is a
Director of American Medical Response, Inc. He is a Trustee and former
Chairman of the New England Aquarium, Chairman of the Artery Business
Committee, Trustee of the Boston Plan for Excellence, and Trustee of
Emmanuel College. He also served as Chairman of the United Way of
Massachusetts Bay and Chairman of the Massachusetts Port Authority. He
currently serves as a Director of several other civic and charitable
organizations.
<PAGE>
INFORMATION RELATIVE TO THE BOARD OF DIRECTORS
AND CERTAIN OF ITS COMMITTEES
A formal Audit Committee of the Board of Directors was created in
1971. The present Committee, which met five times in 1994, is composed
of three Directors - Messrs. Goldhammer (Chairman), Gray and Hansen,
none of whom is an employee of the Company.
The responsibilities of the Audit Committee are (1) to recommend
the particular persons or firm to be employed by the Company as its
independent auditor; (2) to consult with the persons so chosen to be the
independent auditor with regard to the plan of audit; (3) to review, in
consultation with the independent auditor, its report of audit or
proposed report of audit, and the accompanying management letter, if
any; and (4) to consult periodically with the independent auditor with
regard to the adequacy of internal controls and, if the Committee so
chooses, to consult with the internal auditors, the Chief Financial
Officer, the Corporate Controller, the Treasurer and other officers and
employees as the Committee may deem appropriate.
The Compensation and Stock Option Committee of the Board of
Directors, which met three times in 1994, is composed of four Directors
- - Messrs. Tod (Chairman), Turley and Pounds and Ms. Marshall. The
Committee reviews and approves the salaries and incentive compensation
of the Chairman of the Board, the Chief Executive Officer, the
President, and the Executive and Senior Vice Presidents. The Committee
also reviews and approves the Management Incentive Plans of the Company
and its subsidiaries, administers the stock option plans adopted by the
Company, and reviews and approves such other employment and compensation
matters as it deems necessary and proper.
The Corporate Governance Committee of the Board of Directors,
which met one time in 1994, is composed of five Directors - Messrs.
Pounds (Chairman), Rubinovitz, Freed, Hansen and Thompson. The
Committee examines and defines the Board of Directors' role in corporate
governance, formulates policy to deal with and be responsive to
shareholder concerns, and formulates guidance, for management action, to
deal with evolving social issues, both internal and external to the
organization.
A Nominating Committee of the Board of Directors was created in
1991. The present Committee, which met four times in 1994, is composed
of three Directors - Messrs. Thompson (Chairman), Tod and Hansen. The
Committee establishes criteria for nomination or renomination as a
Director, develops procedures for the nomination or renomination
process, and identifies and recommends candidates for nomination to the
Board of Directors. Any stockholder desiring to submit a candidate for
consideration by the Nominating Committee should send sufficient
biographical data and background information concerning the candidate to
enable a proper judgment as to the candidate's qualifications, together
<PAGE>
with any other relevant information, to: Chairman of the No
Committee, c/o EG&G, Inc., 45 William Street, Wellesley, MA 02181.
A Benefit Plans Investment Committee of the Board of Directors was
created in October of 1991. The present Committee, which met one time
in 1994, is composed of four Directors - Messrs. Gray (Chairman), Turley
and Goldhammer and Ms. Marshall. The Committee reviews the investment
of funds held in the Company's employee benefit plans.
The Board of Directors also has an Executive Committee composed of
three Directors - Messrs. Kucharski, Rubinovitz and Gray. The
Committee, which acts as needed during intervals between Board meetings,
has been delegated with all the powers of the Board except those powers
which by law, the Articles of Organization or the By-Laws of the
Company, the Board of Directors is prohibited from delegating.
Meetings
The Board of Directors met eight times in 1994. All Directors
attended at least 75 percent of the aggregate number of meetings of the
Board of Directors and the committees of the Board on which they
respectively served.
Director Compensation
Directors who are employees of the Company receive no additional
compensation for their services as Directors. Directors who are not
employees of the Company are paid an annual retainer fee of $12,000 and
$1,000 for each meeting of the Board that they attend. Additionally,
the Chairmen of the Audit, Compensation and Stock Option, Corporate
Governance, Nominating, and Benefit Plans Investment Committees receive
$4,000 per year and the other non-employee members of these Committees
receive $3,000 per year. All non-employee members of these Committees
receive $1,000 for each Committee meeting that they attend unless the
Committee meeting is held on the same day as a Board of Directors'
meeting, in which case, the Committee member receives $500.
<PAGE>
The Board of Directors approved and adopted the EG&G, Inc. 1990
Director Stock Plan on January 24, 1990 and the stockholders of EG&G
approved the Director Stock Plan at the Annual Meeting of Stockholders
on April 24, 1990. The Director Stock Plan provides that on each
January 31, non-employee Directors who served for the preceding calendar
year shall receive 800 shares of Common Stock. If a Director fails to
attend at least 75 percent of the aggregate number of meetings of the
Board and the committees on which the Director served during the
preceding year, the number of shares of Common Stock will be reduced to
400 shares and no shares will be issued if a Director fails to attend 50
percent of such meetings. In accordance with the Director Stock Plan,
in February of 1995, each of the ten non-employee Directors who served
as Directors for the 1994 calendar year received 800 shares of Common
Stock, with a fair market value to each such Director at that time of
$11,150.
In addition to the foregoing, the Company has a Deferred
Compensation Plan for non-employee Directors. The Plan provides for an
annual payment to be made by the Company to the eligible Director or his
estate in an amount equal to 100 percent of the Director's annual
retainer fee in effect at the time the Director's service on the Board
ceases due to death, retirement, or resignation. The annual payments
will be made for the greater of five years or the number of years the
Director served on the Board.
The Company also has established the EG&G, Inc. Directors
Charitable Contribution Program for certain outside Directors. To be
eligible under the program, the Director must be an outside director
with no previous employment with the Company and have either been a
member of the Company's Board of Directors as of January 1, 1992 or have
otherwise completed five years of service on the Board. Under this
program, the Company will contribute, upon the death of an eligible
Director, a total of $1,000,000 to one or more qualifying charitable
organizations named by the Director. The program is funded through a
life insurance policy on each such eligible Director, with the life
insurance proceeds payable to EG&G.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table identifies the only persons known to the
Company to be beneficial owners of five percent or more of the
outstanding shares of Common Stock. The information in this table and
the footnotes is taken from a Schedule 13G dated February ___, 1995,
filed by INVESCO PLC, a Schedule 13G dated January 10, 1995, filed by
The Regents of the University of California, and a Schedule 13G dated
February ___, 1995, filed by FMR Corp. with the Securities and Exchange
Commission.
<PAGE>
<TABLE>
Name and Address Amount and Nature Percent of
of Beneficial of Beneficial Class
Owner Ownership (1)
________________ _________________ ___________
<S> <C> <C>
INVESCO PLC (2) ____________ (2) _______%
INVESCO North American
Group, Ltd. (2)
INVESCO, Inc. (2)
INVESCO North American
Holdings, Inc. (2)
INVESCO Capital
Management, Inc. (2)
c/o 11 Devonshire Square
London EC2M 4YR
England
The Regents of the 3,343,000 (3) 6.06%
University of California
300 Lakeside Drive
Office of the Treasurer
Oakland, CA 94612
FMR Corp. _____________ (4) _______%
82 Devonshire Street
Boston, MA 02109
</TABLE>
NOTES
(1) There are no shares included with respect to which such persons
have a right to acquire beneficial ownership.
(2) The Schedule 13G filed by INVESCO PLC on behalf of itself, as the
parent holding company, and its subsidiaries, INVESCO North American
Group, Ltd., INVESCO, Inc., INVESCO North American Holdings, Inc., and
INVESCO Capital Management, Inc. (the "Reporting Persons") states that
each of the foregoing Reporting Persons is the beneficial owner of the
same __________ shares and that each of the Reporting Persons has shared
voting power and shared dispositive power over those ___________ shares.
Each of the Reporting Persons declares that the filing of the Schedule
13G shall not be deemed as an admission that it is the beneficial owner
of the securities covered by the Schedule.
<PAGE>
(3) The Schedule 13G filed by The Regents of the University of
California states that it has sole voting power and sole dispositive
power over 3,343,000 shares.
(4) The Schedule 13G filed by FMR Corp. states that it has sole voting
power over ________ shares and sole dispositive power over __________
shares.
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
The following table shows the number of shares of Common Stock
owned of record or beneficially (including unexercised stock options) on
February 1, 1995, (i) by each of the Directors and nominees for
Director individually, (ii) by each of the executive officers named in
the Summary Compensation Table, and (iii) by all of the executive
officers, Directors, and nominees for Director as a group. No Director,
nominee for Director, or executive officer of the Company owned any
equity securities of the Company other than Common Stock on that date.
<TABLE>
Amount and Nature of Percent
Name Beneficial Ownership of Class
_____________________ ____________________ _________
<S> <C> <C>
John M. Kucharski(1)(2) 433,162 *
Fred B. Parks(1) 93,461 *
Edward H. Snow(1)(2) 125,985 *
Charles M. Williams(1)(2) 122,184 *
James O. Zane(1)(2) 111,597 *
Samuel Rubinovitz(1)(2) 116,108 *
Dean W. Freed(1) 44,024 *
William F. Pounds 15,200 *
Joseph F. Turley 15,600 *
Kent F. Hansen 4,000 *
Robert F. Goldhammer 14,000 *
John B. Gray 11,800 *
G. Robert Tod 9,000 *
John Larkin Thompson 6,800 *
Greta E. Marshall 3,800 *
- ------------------
- ------------------
- ------------------
All executive officers,
Directors, nominees for
Director, of the Company
as a Group, 33 in number,
including those listed
above (1)(2)
1,932,571 3.5%
(not including
3 nominees)
</TABLE>
*Less than 1%
<PAGE>
NOTES
1) The amounts shown as beneficially owned by Messrs. Kucharski, Parks,
Snow, Williams, Zane, Rubinovitz, and Freed, and by all executive
officers, Directors, and nominees for Director as a group, include
374,000, 87,600, 68,700, 91,900, 103,300, 99,000, 14,824, and $1,617,624
shares, respectively, which are obtainable only upon exercise of, and
payment for, outstanding, unexercised stock options.
(2) Owners of all shares shown have sole voting and investment power
except Messrs. Kucharski, Snow, Williams, Zane, and Rubinovitz and
certain executive officers of EG&G, not identified by name in the above
Table, as a group, who share investment and/or voting power over 24,962
shares, 54,986 shares, 20,684 shares, 8,297 shares, 5,940 shares, and
22,057 shares, respectively. The number of shares stated as being owned
beneficially includes shares held beneficially by spouses, minor
children, and certain trusts; the inclusion of such shares in the Proxy
Statement, however, does not constitute an admission that the executive
officers, Directors, or nominees for Director are direct or indirect
beneficial owners of such shares.
<PAGE>
BOARD COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
The Compensation and Stock Option Committee (Committee) of the
Board of Directors is composed of four independent outside Directors.
The Committee's report on executive compensation follows.
Overall Philosophy
The Company's overall executive compensation philosophy is based
on the premise that compensation should be aligned with and support the
Company's business strategy and long-term initiatives, enhance
shareholder value and be competitive with that offered by comparable
companies. Under the guidance of the Committee, compensation policies
have been designed which link executive compensation to the attainment
of the Company's specific goals. These policies also allow the Company
to attract and retain those senior executives critical to the long-term
success of a highly diversified organization by providing a competitive
compensation package and recognizing and rewarding individual
contributions. The key elements of the Company's executive compensation
are base salary, annual incentive awards, and stock options.
Section 162(m) of the Internal Revenue Code which became effective
January 1, 1994 generally limits the deductibility of annual
compensation for certain officers to $1 million. It is the general
intention of the Committee to assure that Officer compensation will meet
the Section 162(m) requirements for deductibility. However, the
Committee reserves the right to use its judgement to authorize
compensation payments which may be in excess of the limit when the
Committee believes such payment is appropriate, after taking into
consideration changing business conditions or the Officer's performance,
and is in the best interest of the shareholders. The Committee will
review its policy concerning Section 162(m) on a year by year basis.
Base Salary
Each year, the Committee reviews and establishes the base salary
of the Chief Executive Officer based on the Company's performance, as
measured by a combination of factors consisting principally of sales,
earnings per share growth, return on equity, and on a comparison to
executive compensation in other companies as revealed by the surveys
referred to below. The Committee also reviews, approves or modifies, as
deemed appropriate by the Committee, a salary plan recommended by the
Chief Executive Officer and the Vice President of Human Resources for
the positions of President and Senior Vice President. This plan,
developed by the Human Resources staff, is based on the performance of
each such Officer while taking into consideration the Company's
performance as measured by the factors described above.
<PAGE>
Two national surveys are used to provide general overall guidance
with respect to compensation levels. A special study is also conducted
that contains compensation data on approximately 20 companies in the S&P
High Tech Composite Index. The S&P High Tech Composite Index was chosen
because it is comprised of companies in businesses similar to that of
the Company and is one of the indices with which the Company's
cumulative total shareholder return is compared in this Proxy Statement.
The special compensation study was performed by a major consulting firm
utilizing the compensation data contained in their compensation data
bank. The report shows the average base and average total compensation
for selected Officer positions for companies comparable in size to EG&G,
Inc. Generally, the compensation levels of EG&G Officers are comparable
with those for similar positions within the companies included in the
above-mentioned surveys.
In view of uncertain economic conditions in the U.S. and
throughout the world, the base salaries of all Officers, upon
recommendation of the Chief Executive Officer and the approval of the
Committee, were frozen from December, 1990 through the end of 1993.
Officers who were promoted or whose salaries were found to be
significantly below comparable data were eligible for salary
adjustments. The salary freeze was discontinued at the end of 1993. In
accordance with our policy to pay competitive salaries, the base salary
of most Officers was increased in January 1994. Mr. Kucharski's base
salary was increased to $650,000 per year in January 1994.
Annual Incentive Plan
Each year, the Committee reviews, approves or modifies as deemed
appropriate, incentive plans based on performance goals established for
each operating unit. Incentive awards are normally paid in cash upon
the completion of the annual audit. The performance goals for
Headquarters executives are earnings per share growth and return on
equity. The performance goals for each operating unit are normally one,
or a combination of, the following measurements: sales growth, profit
growth , the operating profit to sales ratio, return on net investment,
and cash flow. The incentive pool earned by any operating unit may be
decreased by up to 50% in the event the Company does not attain its
earnings per share growth goal. Individual incentive awards are made on
the basis of responsibility and contribution to the operating unit's
performance.
Because 1994 earnings per share did not meet the established goal
for 1994, Mr. Kucharski was not eligible to receive a 1994 incentive
award.
<PAGE>
Stock Options
Many studies indicate a correlation between stock ownership and
performance. Under the Company's Stock Option Plans, stock options are
granted to the Company's senior executives following guidelines
established by the Committee. These guidelines are based primarily on
competitive industrial practice as revealed by a long-term executive
compensation survey covering a large number of public companies in a
variety of industries in which the Company participates. The survey
data show that the normal stock option award is a multiple of base
salary. Beginning in 1991, the Committee began to use the Black-Scholes
option pricing method as the basis for determining the value of the
option grants. This method takes into consideration a number of factors
including the stock's volatility, dividend rate, option term, and
interest rates to estimate the option's present value. Mr. Kucharski
was granted an option on 75,000 shares in 1994 based on the survey data
and the application of the Black-Scholes option pricing method.
Stock options are classified as long-term incentives and are
intended to link the long-term interests of the executive with those of
the stockholder. Stock options will provide value to the optionee only
when the price of EG&G stock increases above the option price. All
options are granted with an exercise price equal to the fair market
value on the date of the grant.
Compensation and Stock Option Committee
G. Robert Tod (Chairman) Joseph F. Turley
William F. Pounds Greta E. Marshall
<PAGE>
STOCK PERFORMANCE GRAPH
Set forth below is a line graph comparing the cumulative total
stockholder return on the Company's Common Stock against the cumulative
total return of the S&P Composite-500 Stock Index and the S&P High
Technology Composite Index for the period of five fiscal years
commencing January 1, 1990 and ended January 1, 1995.
Comparison of Five-Year Cumulative Total Return*
EG&G, Inc. Common Stock, S&P Composite-500 and
S&P High Technology Composite Indices
<TABLE>
Indexed Returns
Year Ending
<S> <C> <C> <C> <C> <C> <C>
Company/Index Dec. Dec. Dec. Dec. Dec. Dec.
1989 1990 1991 1992 1993 1994
S&P 500 Index 100 96.90 126.42 136.05 149.76 151.74
EG&G, Inc. 100 93.15 152.76 123.14 118.28 94.10
High Tech
Composite 100 102.12 116.50 121.31 149.22 173.92
</TABLE>
* Assumes that the value of the investment in EG&G, Inc. Common Stock
and each index was $100 on December 31, 1989 and that all dividends were
reinvested.
<PAGE>
The following table sets forth information concerning the annual
and long-term compensation for services to the Company for the 1992,
1993, and 1994 fiscal years, of those persons who were, at January 1,
1995 (i) the chief executive officer, and (ii) the other four most
highly compensated executive officers of the Company.
<TABLE>
SUMMARY COMPENSATION TABLE
Annual Compensation
<S> <C> <C> <C> <C> <C>
Other
Annual
Compen-
Name and Salary Bonus sation(1)
Principal Position Year ($) ($) ($)
John M. Kucharski 1994 647,885 0
Chairman of the 1993 540,020 0
Board, President, 1992 540,020 230,000
and Chief
Executive Officer
Fred B. Parks 1994 333,350 0
Senior Vice 1993 241,438 70,000
President 1992 222,012 120,000
Edward H. Snow 1994 220,329 88,200
Vice President 1994 190,320 0
1992 190,320 75,000
C. Michael Williams 1994 249,439 37,300
Vice President 1993 220,012 70,000
1992 220,012 85,500
James O. Zane 1994 274,476 0
Senior Vice 1993 250,016 0
President 1992 210,000 150,000
<PAGE>
SUMMARY COMPENSATION TABLE (CONT.)
Long-Term Compensation
Awards Payouts
All
Restricted Securities Other
Stock Underlying LTIP Compen
Name and Award(s) Options Payouts sation (2)
Principal Position Year ($) (#) ($) ($)
John M. Kucharski 1994 75,000 33,434
Chairman of the 1993 60,000 36,249
Board, President, 1992 50,000 39,746
and Chief
Executive Officer
Fred B. Parks 1994 35,000 3,300
Senior Vice 1993 20,000 7,099
President 1992 20,000 4,437
Edward H. Snow 1994 17,500 17,412
Vice President 1994 12,000 19,560
1992 10,000 21,882
C. Michael Williams 1994 19,000 15,026
Vice President 1993 12,600 17,400
1992 12,600 18,555
James O. Zane 1994 12,500 17,288
Senior Vice 1993 22,500 19,692
President 1992 25,000 25,660
</TABLE>
NOTES
(1) Perquisities and other personal benefits did not in the aggregate
reach the lesser of $50,000 for any named executive officer or 10
percent of the total of annual salary and bonus reported in this table
for such executive.
(2) This column includes the actuarial benefit to the named executive
officer of the split-dollar life insurance policy established in 1991
and the Company's contribution to the EG&G, Inc. Savings Plan. The
actuarial benefit of the split-dollar life insurance to Messrs.
Kucharski, Parks, Snow, Williams, and Zane is $28,484, $0, $12,462,
$10,076, and $12,338, respectively. The Company makes no contribution
to the term life portion of the split-dollar life insurance premium.
The named executive officer contributes an amount each year to the
split-dollar life insurance policy equal to the cost of the term life
insurance under the policy. The amount reported in the column for 1994
for Messrs. Kucharski, Parks, Snow, Williams, and Zane includes $4,950,
$3,300, $4,950, $4,950, and $4,950, respectively, as the Company's
contribution to the EG&G, Inc. Savings Plan for the aforementioned
executives.
PENSION PLANS
Employees Retirement Plan
The Company and its subsidiaries maintain several basic retirement
plans for the benefit of their employees, including officers. With four
exceptions, all of the executive officers, including all of the five
highest compensated executive officers, participate in the EG&G, Inc.
Employees Retirement Plan (the "Retirement Plan"), the principal
features of which are as follows.
Subject to maximum benefit limitations prescribed by law, a
participant will be entitled to receive an annual payment equal to the
sum of 0.85 percent of the participant's Final Average Earnings (the
average of the employee's base salary for the five consecutive
highest-salaried years out of the last ten years of credited service
with the Company) multiplied by the number of years of credited service
with the Company plus 0.75 percent of the excess of such earnings over
the Social Security Tax Base multiplied by the number of years of
credited service (not in excess of 35) with the Company. All of the
employees of EG&G, Inc. who participate in the Retirement Plan are
required to either complete five years of service or reach their normal
retirement date before they have a vested interest in the Retirement
Plan.
The following table sets forth information with respect to
estimated annual benefits under the Retirement Plan, payable upon
retirement to persons in the specified ranges of compensation and years
of service.
<PAGE>
PENSION PLAN TABLE
ANNUAL ESTIMATED BENEFITS
UNDER THE EG&G, INC. EMPLOYEES RETIREMENT PLAN(1)(2)
Years of Service
<TABLE>
Final
Average
Earnings 15 Years 20 Years 25 Years 30 Years 35 Years
<S> <C> <C> <C> <C> <C>
$500,000 $117,233 $118,800 $118,800 $118,800 $118,800
475,000 111,233 118,800 118,800 118,800 118,800
450,000 105,233 118,800 118,800 118,800 118,800
400,000 93,233 118,800 118,800 118,800 118,800
375,000 87,233 116,310 118,800 118,800 118,800
350,000 81,233 108,310 118,800 118,800 118,800
325,000 75,233 100,310 118,800 118,800 118,800
300,000 69,233 92,310 115,388 118,800 118,800
275,000 63,233 84,310 105,388 118,800 118,800
250,000 57,233 76,310 95,388 114,465 118,800
225,000 51,233 68,310 85,388 102,465 118,800
200,000 45,233 60,310 75,388 90,465 105,543
175,000 39,233 52,310 65,388 78,465 91,543
150,000 33,233 44,310 55,388 66,465 77,543
125,000 27,233 36,310 45,388 54,465 63,543
100,000 21,233 36,310 35,388 42,465 49,543
75,000 15,233 20,310 25,388 30,465 35,543
50,000 9,233 12,310 15,388 18,465 21,543
</TABLE>
NOTES
(1)For the purpose of calculating the amounts shown in the above table,
it is assumed that the participants in the specified ranges retired on
December 31, 1994, and at age 65, and that all payments were made on a
straight life annuity basis. These payments are not subject to any
deduction for Social Security benefits.
<PAGE>
(2)Messrs. Kucharski, Parks, Snow, Williams, and Zane have respectively
29, 18, 6, 29, and 2 years of credited service under the EG&G, Inc.
Employees Retirement Plan; and $150,000 of the 1994 compensation of each
of Messrs. Kucharski, Parks, Snow, Williams, and Zane is covered by the
Retirement Plan. The reasons for the difference between the amounts
shown in the Summary Compensation Table and the amounts disclosed above
are that compensation in excess of $150,000 and all incentive payments
and deferred compensation amounts, other than amounts deferred under
savings plans, are excluded in determining the compensation covered by
the Retirement Plan.
Supplemental Executive Retirement Plan
In addition to the basic benefit plan outlined in the table above,
the Company has created the EG&G, Inc. Supplemental Executive Retirement
Plan (the "Supplemental Plan"), which provides additional benefits for
executive officers. Officers at the Vice Presidential level and above,
the General Counsel, the Corporate Controller, the Treasurer, the
Assistant Treasurer, the Assistant Clerk, and others designated by the
Board of Directors are eligible to receive benefits under the
Supplemental Plan when they have reached 55 years of age and completed
five years of service. In the event of a change of control as defined
in the Supplemental Plan, however, participants in the Supplemental Plan
are eligible to receive benefits regardless of age or years of service.
If a participant dies prior to attaining age 55, but after the
completion of five years of service, the participant's eligible spouse
is entitled to receive a benefit in the form of a 50 percent surviving
spouse option commencing on the date the participant would have attained
age 55.
During 1994, the Company charged $1,477,067 as an expense for the
Supplemental Plan and made payments to retired officers and
beneficiaries in the amount of $343,552. While the Company is not
required to fund the Supplemental Plan, effective April 6, 1989, the
EG&G, Inc. Non-Qualified Benefit Trust Agreement (the "Trust") was
established by and between EG&G, Inc. and The Boston Safe Deposit and
Trust Company. As of December 31, 1994, the Trust had a balance of
$6,022,104. The purpose of the Trust is to provide greater assurance of
the receipt of Supplemental Plan benefits. Amounts held in the Trust
are subject to the claims of the Company's general creditors in the
event of the Company's insolvency or bankruptcy.
The Supplemental Plan is administered by the Compensation and
Stock Option Committee of the Board of Directors. The Board of
Directors may amend or terminate the Supplemental Plan at any time;
however, such amendment or termination shall not reduce or eliminate the
benefit payments currently being made or the accrued plan benefit of any
participant.
<PAGE>
The Supplemental Plan provides an annual benefit payable at
retirement equal to:
(a) 0.85 percent of average total compensation (as defined below) for
each year of credited service, plus 0.75 percent of average total
compensation in excess of the Social Security Tax Base, less (b),
(b) 100 percent of the participant's benefit accrued at date of
termination and payable at normal retirement age under any
Company-funded retirement plan, plus (c),
(c) The reduction, if any, to the early retirement benefit payable from
any Company-funded retirement plan due to the limitations as set forth
in Section 415(b) of the Internal Revenue Code of 1986.
The benefit payable under the Supplemental Plan, however, shall in
no event be less than (c) above.
Years of service after age 65 are not counted in determining
benefits under the Supplemental Plan, nor is any actuarial adjustment
made as a result of retirement before or after age 65. Average total
compensation is the average of a participant's total cash compensation
for the highest-compensated consecutive five years of credited service
out of his last ten years of credited service prior to age 65 (or his
age at earlier termination of employment).
Messrs. Kucharski, Snow, Williams, and Zane have reached the
minimum age of eligibility for retirement under the Supplemental Plan.
In combination with the amounts payable under the EG&G, Inc. Employees
Retirement Plan, Messrs. Kucharski, Snow, and Williams would receive
$259,900, $16,573, and $103,386, respectively, assuming they retired on
the last day of 1994 and received benefits in the form of a lifetime
income. In combination with the amounts payable under the EG&G, Inc.
Employees Retirement Plan and the Idaho National Engineering Laboratory
Employee Retirement Plan, Mr. Zane would receive $144,121, assuming he
retired on the last day of 1994 and received benefits in the form of a
lifetime income.
Employment and Other Agreements
Compensation in the form of salary to Mr. Kucharski is paid
pursuant to a three-year employment agreement with the Company dated
November 1, 1993, automatically renewable for successive 3-year
intervals, which provided for a minimum annual payment in 1994 of
$650,000. Compensation in the form of salary to Messrs. Parks, Snow,
Williams, and Zane is paid pursuant to one-year employment agreements
with the Company dated November 1, 1993, automatically renewable for
<PAGE>
successive 1-year intervals, which provided for minimum annual
in 1994 of $334,984, $220,532, $250,016, and $274,976, respectively.
All of the employment agreements with the named executive officers
contain provisions that provide that in the event of a change in control
of the Company, the employment term shall be extended for a period of
five (5) years from the date of the change of control. Following a
change in control, if the named executive is terminated without "cause"
or resigns for "good reason" (each as defined in the agreement), the
named executive is entitled to receive a severance payment equivalent to
five (5) years of base salary plus bonuses and continuation of certain
benefits for five (5) years from the date of termination.
Generally, a change in control will be deemed to have occurred in
any of the following circumstances:
1) the acquisition of 30% or more of the outstanding voting stock of
the Company by any person or entity;
2) during any period of two consecutive years, persons serving as
directors of the Company and those replacements or additions approved by
a two-thirds vote of the Board, cease for any reason to constitute a
majority of the Board;
3) the stockholders of the Company approve a merger or consolidation
in which the voting securities of the Company outstanding immediately
prior thereto would end up representing 50% or less of the voting power
of the surviving entity; or
4) a plan for the complete liquidation or an agreement for the sale
or disposition of all or substantially all of the assets of the Company
is approved by the stockholders of the Company.
All of the employment agreements with the named executive officers, with
the exception of Mr. Kucharski's employment agreement, contain
provisions that provide that upon termination initiated by the Company
without cause, apart from a change in control situation, each executive
would be entitled to continuation of his or her salary, bonus, and
employee benefits for one (1) year from the date of termination. Mr.
Kucharski's employment agreement provides that he would be entitled to
the continuation of his salary, bonus, and employee benefits for three
(3) years from the date of termination.
In July 1994, the Company entered into an agreement with Mr.
Richard Delio in connection with Mr. Delio's resignation as the
Company's Senior Vice President and Chief Financial Officer. In
accordance with the agreement, the Company paid Mr. Delio a lump sum
severance payment of $562,510.
<PAGE>
In May and August 1994, respectively, the Company entered into
agreements with Mr. Louis Williams and Mr. Elmar Illek, then Company
Vice Presidents, relating to the terms of their separation from the
Company. Pursuant to the agreements, the Company paid to Mr. Williams
and Mr. Illek lump sum severance payments of $272,646 and $664,000,
respectively.
The Company has a renewable one-year consulting agreement, dated
January 1, 1994, with Mr. Samuel Rubinovitz, a Director and former
Executive Vice President of the Company. The Company paid Mr.
Rubinovitz $13,425 in 1994 for services rendered pursuant to the
consulting agreement.
OPTION GRANTS
The following table sets forth information on grants of stock
options pursuant to the EG&G, Inc. 1992 Stock Option Plan during the
fiscal year ended January 1, 1995, to the officers identified in the
Summary Compensation Table. No stock appreciation rights were granted
under that Plan during the last fiscal year.
<TABLE>
OPTION GRANTS TABLE
OPTION GRANTS IN LAST FISCAL YEAR (1) GRANT
DATE
INDIVIDUAL GRANTS VALUE (2)
<CAPTION>
________________________________________________________________________
NUMBER OF % OF TOTAL
SECURITIES OPTIONS EXERCISE GRANT
UNDERLYING GRANTED TO OR BASE DATE
OPTIONS EMPLOYEES PRICE PER PRESENT
GRANTED IN FISCAL SHARE(3) EXPIRATION VALUE(2)
NAME (#) YEAR ($) DATE ($)
________________________________________________________________________
<S> <C> <C> <C> <C> <C>
John M. Kucharski 75,000 10.2 14.2500 12/20/04 401,250
Fred B. Parks 35,000 4.7 14.2500 12/20/04 187,250
Edward H. Snow 17,500 2.4 14.2500 12/20/04 93,625
Charles M. Williams 19,000 2.6 14.2500 12/20/04 101,650
James O. Zane 12,500 1.7 14.2500 12/20/04 66,875
</TABLE>
<PAGE>
NOTES
(1) All options granted by the Company in 1994 to the officers
identified above are non-statutory options and vest in 20% increments
over a period of five (5) years. The options become fully vested and
immediately exercisable upon the death of the optionee while in the
employ of the Company; upon termination of the optionee's employment due
to permanent and total disability or upon retirement at a Company-
recognized retirement age; or upon a change in control of the Comp
(2) The Black-Scholes option pricing model was chosen to estimate the
grant date present value of the options set forth in this table. The
assumptions used at the time of grant in December of 1994 included
expected market volatility of 27%, a 6 1/4% risk-free rate of return, a
2.3% dividend yield, and a 10-year exercise period.
(3) The exercise or base price is equal to the fair market value of
the Common Stock as determined by the closing price on the New York
Stock Exchange-Composite Transactions on December 20, 1994, the date of
grant.
Option Exercises and Fiscal Year-End Values
The following table sets forth information with respect to option
exercises during the 1994 fiscal year and the number and value of
unexercised options to purchase the Company's Common Stock held by the
officers named in the Summary Compensation Table at the end of the 1994
fiscal year.
<PAGE>
<TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL
YEAR-END OPTION VALUE TABLE
<CAPTION>
________________________________________________________________________
Number of
Securities Value of
Underlying Unexercised
Unexercised In-The-Money
Shares Options at Options at
Acquired Value FY-End FY-End
on Exercise Realized (#) ($)
Name (#) ($) Exercisable/ Exercisable/
Unexercisable Unexercisable(1)
________________________________________________________________________
<S> <C> <C> <C> <C>
John M. Kucharski 0 0 299,000/75,000 0/0
Fred B. Parks 0 0 52,600/35,000 0/0
Edward H. Snow 800 3,300 51,200/17,500 0/0
C. Michael Williams
3,500 9,625 72,900/19,000 0/0
James O. Zane 2,200 7,425 90,800/12,500 0/0
</TABLE>
(1) Based on the fair market value (determined by averaging the high and
the low selling price) on the New York Stock Exchange-Composite
Transactions of the Company's Common Stock on December 30, 1994
($14.25).
ITEM NO. 2
AMENDMENT OF THE COMPANY'S ARTICLES OF ORGANIZATION TO PROVIDE FOR THE
DECLASSIFICATION OF THE BOARD OF DIRECTORS, SUCH DECLASSIFICATION TO
COMMENCE WITH THE ANNUAL MEETING OF STOCKHOLDERS IN 1996.
Item 6 of the Company's Articles of Organization at present provides for
the division of the Board of Directors into three classes, each class
consisting as nearly as possible of one-third of the total number of
Directors, with each class of Directors having a separate or staggered
three-year term of office. Pursuant to a review undertaken by the
Corporate Governance Committee of the Board of Directors, the Board has
determined that eliminating the classified Board and instead having all
of EG&G's Directors elected annually would best serve the interests of
the Company and its stockholders. The Board has determined that this
change should be implemented on a prospective basis, commencing with the
Annual Meeting of Stockholders in 1996, so as not to shorten the term
for which any incumbent Director already has been elected to serve.
<PAGE>
Thus, as proposed to be amended, the revised Articles of Organization
would provide that at each Annual Meeting of Stockholders, commencing
with the Annual Meeting of Stockholders in 1996, the successors of the
Directors whose terms expire in that year shall be elected for a one-
year term. Accordingly, upon the expiration in 1998 of the terms of the
Directors elected at this year's Annual Meeting, all Directors will be
elected to hold office for a one-year term.
Accordingly, Management will present to the Meeting a proposal that the
Company's Articles of Organization be amended to declassify the Board of
Directors as discussed above by deleting Item 6 of the Company's
Articles of Organization and substituting therefor a revised Item 6 as
set forth in Exhibit A to this Proxy Statement.
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE
PROPOSED AMENDMENT TO THE COMPANY'S ARTICLES OF ORGANIZATION TO
DECLASSIFY THE BOARD OF DIRECTORS.
ITEM NO. 3
STOCKHOLDER PROPOSAL TO RECOMMEND THAT ALL FUTURE NON-EMPLOYEE DIRECTORS
NOT BE GRANTED PENSION BENEFITS AND THAT CURRENT NON-EMPLOYEE DIRECTORS
VOLUNTARILY RELINQUISH THEIR PENSION BENEFITS.
Management has been advised that a stockholder (name and address
and Common Stock holdings of proponent will be supplied upon oral or
written request to the Clerk of the Corporation) intends to introduce a
proposal at the Annual Meeting which recommends that all future non-
employee Directors not be granted pension benefits and that curr
THE BOARD OF DIRECTORS' STATEMENT IN OPPOSITION TO ITEM NO. 3
The Company has a Deferred Compensation Plan for non-employee Directors.
The Plan provides for the payment of an annual benefit to the Director
or his or her estate in an amount equal to the Director's annual
retainer fee in effect at the time the Director's service on the Board
ceases due to death, retirement, or resignation. The payments are made
for the greater of five years or the number of years the Director served
on the Board.
Management believes that it is in the best interests of the Company and
its stockholders to have capable and experienced individuals serving on
the Company's Board of Directors. In order for the Company to be able
to attract and to motivate such individuals, it is necessary for the
Company to provide a benefits package competitive with that of other
major corporations. The benefits offered by EG&G, including the
Deferred Compensation Plan, are representative of those offered by other
large corporations to their outside directors.
With the increased recognition of the link between corporate governance
and the long-term strategic success of a corporation, the demands on the
time, commitment and expertise of individuals serving as directors of a
major public corporation have risen to new levels. Accompanying these
increased demands, has been a commensurate increase in director
liability and accountability. The Company believes that it is necessary
to compensate its Directors for their time and expertise. It strongly
disagrees with the proponent that the providing of benefits to the
Company's outside Directors such as the Deferred Compensation Plan will
cause the Company's Directors to compromise their fiduciary
responsibilities to the stockholders and, in effect, "rubber-stamp"
management policies and initiatives to serve their own self-interest.
The Company believes that its compensation package to outside directors
not only helps to align the interests of its Directors with those of the
Company but also provides for involved and motivated outside Board
members with the capability and expertise to help create and insure the
long-term growth and success of the Company.
TEXT OF STOCKHOLDER PROPOSAL
"RESOLVED, that the shareholders assembled in person and by proxy,
recommend (i) that all future non-employee directors not be granted
pension benefits and (ii) current non-employee directors voluntarily
relinquish their pension benefits."
SUPPORTING STATEMENT OF STOCKHOLDER
"Aside from the usual reasons, presented in the past, regarding
"double dipping", that is outside (non-employee) directors who are in
almost all cases amply rewarded with their pension at their primary
place of employment, and in many instances serving as outside pensioned
directors with other companies, there are other more cogent reasons that
render this policy as unacceptable.
"Traditionally, pensions have been granted in both the private and
public sectors for long term service. The service component usually
represents a significant number of hours per week. The practice of
offering pensions for consultants is a rarity. Outside directors'
service could logically fit the definition of consultants and pensions
for this type of service is an abuse of the term.
"But more importantly, outside directors, although retained by
corporate management, namely the C.E.O., are in reality representatives
of shareholders. Their purpose is to serve as an impartial group to
which management is accountable. Although outside directors are
certainly entitled to compensation for their time and expertise,
pensions have the pernicious effect of compromising their impartiality.
In essence, pensions are management's grants to outside directors to
insure their unquestioning loyalty and acquiescence to whatever policy
management initiates, and at times, serving their own self interests.
<PAGE>
Thus, pensions become another device to enhance and entrench
management's controls over corporate policies while being accountable
only to themselves. As a founding member of the Investors Rights
Association of America I feel this practice perpetuates a culture of
corporate management "cronyism" that can easily be at odds with
shareholder and company interest.
"A final note in rebuttal to management's contention that many
companies offer their outside directors pensions, so they can attract
and retain persons of the highest quality. Since there are also
companies that do not offer their outside directors pensions, can
management demonstrate that those companies that offer pensions have a
better performance record than their non-pensioned peers? In addition,
do we have any evidence of a significant improvement in corporate
profitability with the advent of pensions for outside directors?
"I URGE YOUR SUPPORT, VOTE FOR THIS RESOLUTION."
________________________________________________
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "AGAINST" THIS PROPOSAL.
<PAGE>
OTHER MATTERS
The Board of Directors knows of no other business which will be
presented for consideration at the Meeting other than that described
above. However, if any other business should come before the Meeting,
it is the intention of the persons named in the Proxy to vote, or
otherwise act, in accordance with their best judgement on such matters.
SELECTION OF AUDITORS
On January 25, 1995, the Board of Directors selected the firm of
Arthur Andersen LLP, independent public accountants, to act as the
Company's auditors and to audit the books of the Company and its
subsidiaries for 1995. Arthur Andersen LLP is currently performing
these duties and has done so continuously since 1968.
Representatives of Arthur Andersen LLP have been invited to the
Annual Meeting and are expected to be present and will have an
opportunity to make a statement if they so desire. They are also
expected to be available to respond to appropriate questions from
stockholders.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF
1934.
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers and directors to file initial reports of
ownership and reports of changes in ownership with the Securities and
Exchange Commission and the New York Stock Exchange. The Company has a
program in place to assist its officers and directors in complying with
the filing requirements of Section 16(a). Executive officers and
directors are required by SEC regulations to furnish the Company with
copies of all Section 16(a) forms they file. Based on a review of the
copies of such forms furnished to the Company and written representations
from the Company's executive officers and directors, the Company believes
that during the preceding year its executive officers and directors have
complied with all Section 16 filing requirements.
<PAGE>
STOCKHOLDER PROPOSALS
In order to be considered for addition to the agenda for the 1996
Annual Meeting of Stockholders and to be included in the Proxy Statement
and form of proxy, stockholder proposals should be addressed to the Clerk
of the Company and must be received at the Corporate Offices of EG&G no
later than November 7, 1995.
By Order of the Board of Directors
MURRAY GROSS, Clerk
Wellesley, Massachusetts
March 7, 1995
<PAGE>
EXHIBIT A
Article 6 of the Articles of Organization of EG&G, Inc. is amended
by deleting Article 6 in its entirety and replacing it with the
following:
Meetings of Stockholders may be held within the
Commonwealth of Massachusetts or elsewhere in the
United States of America to the extent permitted by
the By-Laws of the Corporation.
The Directors may make, amend, or repeal the By-
Laws of the Corporation in whole or in part at any
meeting of the Directors by vote of a majority of
the Directors then in office, except that the
provisions thereof fixing the place of the meetings
of Stockholders, designating the number necessary
to constitute a quorum at meetings of the
Stockholders, governing procedure with respect to
the removal of Directors, and affording
indemnification to Directors or officers may be
made, amended, or repealed only by the
Stockholders.
The number of Directors which shall constitute the
whole Board of Directors shall be such number, not
less than three nor more than thirteen, as shall be
fixed by vote of the Stockholders or the Board of
Directors. During the time periods specified in
this Article 6, the Board of Directors shall be
divided into three classes in respect of term of
office, each class to contain, as nearly as
possible, one-third of the whole number of the
Board. Of the Board of Directors elected at the
Annual Meeting of Stockholders in 1975, the members
of one class shall serve until the Annual Meeting
of Stockholders held in the year following their
election, the members of the second class shall
serve until the Annual Meeting of Stockholders held
two years following their election, and the members
of the third class shall serve until the Annual
Meeting of Stockholders held three years following
their election; provided, however, that in each
case Directors shall serve until their successors
shall be elected and qualified. At each Annual
Meeting of Stockholders, commencing with the Annual
Meeting in 1976 through and including the Annual
Meeting in 1995, the successors of the Directors of
the class whose terms expire in that year shall be
elected to serve until the Annual Meeting of
Stockholders held three years next following (and
until their successors shall be duly elected and
qualified), so that the term of one class of
Directors shall expire in each year. At each
Annual Meeting of Stockholders, commencing with the
Annual Meeting in 1996, the successors of the
Directors whose terms expire in that year shall be
elected to serve until the Annual Meeting of
Stockholders held in the following year (and until
their successors shall be duly elected and
qualified), so that, upon the expiration in 1998 of
the terms of the Directors elected at the Annual
Meeting in 1995, all Directors shall be elected to
hold office for a one-year term. A vacancy in the
Board of Directors, however occurring, unless and
until filled by the Stockholders, may be filled by
the Directors. The number of the Board of
Directors may be increased or decreased and one or
more additional Directors elected at any special
meeting of the Stockholders or by a vote of the
Directors then in office. For so long as the
Directors are divided into classes in accordance
with the terms of this Article 6, Directors who are
elected to fill vacancies, whether or not created
by an enlargement of the Board, shall be
apportioned among the classes so as to make all
classes as nearly equal in number as possible.
Directors who are elected to fill vacancies,
whether or not created by an enlargement of the
Board, shall serve until the expiration of the term
of his or her predecessor and until his or her
successor is duly elected and qualified. No
decrease in the number of the Board of Directors
shall shorten the term of any incumbent Directors.
A Director may be removed from office (a) with or
without cause, by vote of two-thirds of the stock
outstanding and entitled to vote in the election of
Directors, provided that the Directors of a class
elected by a particular class of stockholders may
be removed only by the vote of two-thirds of the
shares of such class which are outstanding and
entitled to vote or (b) for cause by vote of a
majority of the Directors then in office. A
Director may be removed for cause only after
reasonable notice and opportunity to be heard
before the body proposing to remove him.
To the fullest extent permitted by Chapter 156B of
the Massachusetts General Laws, as it exists or may
be amended, a Director of this Corporation shall
not be personally liable to the Corporation or its
stockholders for monetary damages for breach of
fiduciary duty as a Director, notwithstanding any
provision of law imposing such liability.
<PAGE>
APPENDIX A
EG&G LOGO
P
R
O
X
Y
EG&G, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
For Annual Meeting of Stockholders April 25, 1995
The undersigned hereby appoints John M. Kucharski, and Murray
Gross, and each of them, proxies with power of substitution to vote, as
indicated below, for and on behalf of the undersigned at the Annual
Meeting of Stockholders of EG&G, Inc., to be held at the Sheraton
Needham Hotel, 100 Cabot Street, Needham, Massachusetts on Tuesday,
April 25, 1995, at 10:30 a.m., and at any adjournment thereof, hereby
granting full power and authority to act on behalf of the undersigned at
said Meeting:
1. ELECTION OF DIRECTORS Authority to fix the number of Directors
at thirteen and to elect John M.
Kucharski, John B. Gray, ________________,
______________, and ______________ for
terms of three years each.
SEE REVERSE SIDE. If you wish to vote in accordance with the
Board of Directors' recommendations, just sign on the reverse
side. You need not mark any boxes.
SEE REVERSE
SIDE
<PAGE>
Please mark
votes as in
this example.
This Proxy when executed will be voted in the manner directed herein.
If no direction is made, this Proxy will be voted FOR fixing the number
of Directors at thirteen and the election of Directors, FOR the
declassification of the Board of Directors, and AGAINST Proposal 3.
The Board of Directors recommends a vote FOR Proposal 1.
(1) Election of Directors (See Reverse).
FOR WITHHELD
FOR, except vote withheld from the following nominee(s):
____________________ ___________________ ______________
The Board of Directors recommends a vote FOR Proposal 2.
(2) Declassification of the Board of Directors commencing with 1996
Annual Meeting of Stockholders.
FOR AGAINST ABSTAIN
The Board of Directors recommends a vote AGAINST Proposal 3.
(3) Stockholder Proposal regarding not granting pension benefits to
non-employee Directors.
FOR AGAINST ABSTAIN
Mark Here
for Address
Change and
Note Change
At Left
Please sign exactly as your name appears
hereon. Joint owners should each sign.
When signing as attorney, executor,
administrator, trustee or guardian,
please give full title as such.
Signature_____________________Date
Signature_____________________Date
<PAGE>
