SCHEDULE 14A (Rule 14a - 101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by 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 Rule 14a-11(c) or Rule
14a-12
EG&G, Inc.
............................................................
(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] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
or 14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to
Exchange Act Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which
transaction applies:
...........................................................
2) Aggregate number of securities to which transaction
applies:
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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):
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4) Proposed maximum aggregate value of transaction:
............................................................
5) Total fee paid:
............................................................<PAGE>
[ ] 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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4) Date Filed:
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<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 23, 1996,
at 10:30 a.m., to consider and act upon the following:
1. A proposal to fix the number of Directors at eleven and
to elect seven nominees for Director for terms of one year
each; and
2. Such other matters 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 23, 1996, 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, 1996
- ------------------------------------------------------------
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 1996
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 23, 1996 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, 1996,
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 23, 1996, 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 47,654,234 shares of Common Stock
outstanding and entitled to vote. Each share of Common
<PAGE>
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 sole item to be acted upon by the stockholders is a
proposal to fix the number of Directors at eleven and to
elect seven Directors for terms of one year each. The
proposal is set forth on your proxy card and 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. You are
provided the opportunity to vote your shares for granting,
or withholding, authority to fix the number of Directors at
eleven and to elect the seven 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 eleven and electing the nominees named in this
Proxy Statement.
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 1995 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.
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.
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.
<PAGE>
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.
The Articles of Organization and By-Laws, as amended in
1996, 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. There are, at
present, ten Directors of the Company. The terms of six of
the Directors expire at this year's Annual Meeting; the
terms of two other Directors expire at the Annual Meeting in
1997; and the terms of the remaining two Directors expire at
the Annual Meeting in 1998. Mr. Rubinovitz has announced
that he will retire from the Board following the expiration
of his term at this year's Annual Meeting.
The Board of Directors has declared it advisable that
the number of Directors be fixed at eleven and has nominated
the following persons for election as Directors for one-year
terms expiring at the Annual Meeting in 1997:
William F. Pounds Tamara J. Erickson
Robert F. Goldhammer Nicholas A. Lopardo
G. Robert Tod Fred B. Parks
Greta E. Marshall
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" FIXING THE
NUMBER OF DIRECTORS AT ELEVEN AND FOR ELECTING THE SEVEN
NOMINEES NAMED ABOVE FOR TERMS OF ONE YEAR EACH.
It is intended that the shares represented by proxies
will be voted to fix the number of Directors at eleven and
for the election of the seven nominees (unless one or more
of the nominees is unwilling or unable to serve) for terms
of one year 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
seven nominees. To apprise you of the qualifications of the
Directors, we are including information concerning the
nominees and the four incumbent Directors whose terms of
office expire in 1997 or 1998.
<PAGE>
Nominees for Director for a one-year term expiring in 1997
WILLIAM F. POUNDS: Age 68; Principal Occupation:
Professor, Sloan School of Management, Massachusetts
Institute of Technology, Cambridge, Massachusetts. Director
of EG&G continuously since 1969. Chairman of the Corporate
Governance Committee and a Member of the Compensation and
Stock Option Committee of the Board of Directors.
Dr. William F. Pounds, who served as Dean of the Alfred P.
Sloan School of Management from 1966 to 1980, has been a
member of the faculty of the school since 1961. He is a
former research scholar at Carnegie Mellon University, from
which he graduated with degrees in Chemical Engineering,
Mathematical Economics, and Industrial Administration.
During the 1950's, Dr. Pounds worked for Eastman Kodak
Company, PPG Industries, Inc., and served as a naval
aviator. He is a Member of the American Academy of Arts and
Sciences and the author of numerous publications in the
field of management. Dr. Pounds also serves as a Director
of the Putnam Funds; the Sun Company, 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 65; Principal Occupation:
Principal shareholder of Concord International Partners, a
merchant banking firm. Director of EG&G continuously since
1981. Chairman of the Audit Committee and Member of the
Benefit Plans Investment Committee of the Board of
Directors.
Mr. Robert F. Goldhammer is a graduate of Boston University
with a degree of Bachelor of Science. He 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 56; Principal Occupation: President and
Chief Operating Officer and Director of the CML Group, Inc.,
a specialty marketing company. Director of EG&G
continuously since 1984. Chairman of the Compensation and
Stock Option Committee and Member of the Nominating
Committee of the Board of Directors.
<PAGE>
Mr. G. Robert Tod is a 1961 graduate of Rensselaer
Polytechnic Institute with a Bachelor's degree in Mechanical
Engineering and a 1967 graduate of the Harvard Business
School MBA Program. 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.
GRETA E. MARSHALL, CFA: Age 58; Principal Occupation:
Principal and founder of The Marshall Plan, a financial
investment company. Elected a Member of the Board of
Directors of EG&G in 1990. Member of the Compensation and
Stock Option Committee and the Benefit Plans Investment
Committee of the Board of Directors.
Ms. Greta E. Marshall manages The Marshall Plan, a financial
investment company she founded in 1988, with offices in
Boston, Massachusetts and Incline Village, Nevada. She has
thirty years of experience in financial analysis, research,
and investment. From 1974 to 1984, she was Director,
Investments, Deere & Company, Moline, Illinois. She was
President of Baybanks Investment Management 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 Board of Directors of Hysec, Inc. Ms.
Marshall holds Bachelor of Arts and Master of Business
Administration degrees from the University of Louisville.
She is a Member of the Editorial Board of CFA Digest and is
a Trustee of the AIMR Investment Management Workshop.
TAMARA J. ERICKSON: Age 41; Principal Occupation: Senior
Vice President of Arthur D. Little, Inc., a management
consulting company in Cambridge, Massachusetts and Chairman
of Innovation Associates, Inc., an Arthur D. Little Company.
Elected a Member of the Board of Directors of EG&G at the
Board of Director's meeting on December 20, 1995.
Ms. Erickson became a Senior Vice President of Arthur D.
Little, Inc. in 1993, a company with which she has been
associated since 1978. She presently serves as Chairman of
Innovation Associates, Inc. with responsibility for
integrating this company into Arthur D. Little's worldwide
management consulting business. From 1991 to 1995, Ms.
Erickson served as a Managing Director of Arthur D. Little,
Inc. with direct line management responsibility for all the
firm's management consulting business in North America,
including strategy and organization, information systems,
and operations management consulting services. Ms. Erickson
is the co-author of the book, Third Generation R&D: Managing<PAGE>
the Link to Corporate Strategy, published in 1991. She
holds a BA degree in Biological Sciences from the University
of Chicago and an MBA from the Harvard Graduate School of
Business Administration. Ms. Erickson is a Director of
Allergan, Inc., Irvine, California. She is a Member of the
Board of Trustees of the Boston Ballet, a Member the Finance
Committee of Belmont Day School, and a Member of the
Industrial Research Institute and the Commercial Development
Association.
NICHOLAS A. LOPARDO: Age 49; Principal Occupation:
Executive Vice President of Global Investment Management and
Chairman and Chief Executive Officer of State Street Global
Advisors, departments of State Street Bank and Trust
Company.
Mr. Lopardo joined the Asset Management Division of State
Street Bank and Trust Company in January 1987. In September
of 1990, he was promoted to Executive Vice President of the
Bank and Chief Executive Officer of State Street Global
Advisors with responsibility for the Company's investment
management businesses. Mr. Lopardo is also a member of the
Senior Executive Group at State Street Bank and Trust
Company which is responsible for setting the policy
direction of the Bank. Prior to joining State Street Bank
and Trust Company, Mr. Lopardo served as Senior Vice
President of sales, marketing and advisory services with
Equitable Life Assurance Society in New York. Mr. Lopardo
has over 28 years of experience in the pension industry,
having served in a variety of roles with Equitable related
to pension marketing, client relationships, and Equitable's
pension investment advisory services. He is a 1968 graduate
of Susquehanna University with a BS in marketing and
management and is a member of the Board of Directors of the
University and the Investment, Property and Finance, and
Executive Committees of that Board. He is also Chairman of
the Advisory Board of the Weis Business School at
Susquehanna University and Chairman of the Board of the
Landmark School, the premier secondary school for dyslexic
students. Mr. Lopardo is also a Board Member of the Boston
Stock Exchange and of the Whitehead Institute for Biomedical
Research.
FRED B. PARKS: Age 48; Principal Occupation: Executive
Vice President and Chief Operating Officer of EG&G, Inc.
Dr. Parks, who joined EG&G in 1976, was elected a Vice
President in 1988, a Senior Vice President in 1991, and
Executive Vice President and Chief Operating Officer in
1995. Dr. Parks has overall responsibility for the four
EG&G business segments - Technical Services, Instruments,
Mechanical Components, and Optoelectronics.
<PAGE>
In the Technical Services area, his duties include oversight
of the engineering, scientific, management and technical
support services provided to a broad range of governmental
and industrial customers. His responsibilities for the
Instruments segment include supervising the development and
manufacture of hardware and associated software for
applications in medical diagnostics, biochemical and medical
research, environmental monitoring, industrial process
measurement, and airport and industrial security. For the
Mechanical Components segment, he oversees the development
and manufacture of products used in the transportation,
aerospace and environmental industries. His duties with
respect to the Optoelectronics segment include overseeing
the manufacture and sale of products utilized by
manufacturers of cameras, copy machines, and light
communications systems, and by the automotive industry, as
well as the cultivation of two important technology
platforms for EG&G's future growth: micromachining and
amorphous silicon.
Dr. Parks earned BS and MS degrees in Mechanical Engineering
from the University of Missouri and the University of
Arizona, respectively. He was awarded a PhD degree in
Mechanical Engineering from the University of Missouri.
Directors whose terms expire in 1997
KENT F. HANSEN: Age 64; 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 Chairman of the Board of Directors
of Stone & Webster, Inc. He is also a Member of the
National Academy of Engineering.
JOHN LARKIN THOMPSON: Age 65; 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, Director and former
Chairman of the Artery Business Committee, and Trustee of<PAGE>
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.
Directors whose terms expire in 1998
JOHN M. KUCHARSKI: Age 60; Principal Occupation: Chairman
of the Board, President, and Chief Executive Officer of
EG&G. Mr. Kucharski has been a Director of the Company
since 1986 and is a Member of the Executive Committee of the
Board of Directors. He joined the Company in 1972 when
Challenger Research, Inc., a firm he co-founded in 1965, was
acquired by EG&G. Mr. Kucharski was elected a Vice
President of the Company in 1979, a Senior Vice President in
1982, and 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. He is a
Director of Nashua Corporation, New England Electric System,
State Street Boston Corporation, and Eagle Industry Co.,
Ltd. He serves on the Board of Trustees of Marquette
University and George Washington University.
JOHN B. GRAY: Age 68; Principal Occupation: Retired
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. Mr. Gray has been a Member of the Board of
Directors of EG&G since 1983 and is a Member of the
Executive Committee and the Audit Committee and Chairman of
the Benefit Plans Investment Committee. He also serves as a
Director of the Liberty Mutual Insurance Companies, Liberty
Financial Co., 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.
<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 four
times in 1995, is composed of three Directors - Messrs.
Goldhammer (Chairman), Gray and Hansen.
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 one time in 1995, is composed
of three Directors - Messrs. Tod (Chairman), 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 1995, is composed of four
Directors - Messrs. Pounds (Chairman), Rubinovitz, 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 three
times in 1995, 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 <PAGE>
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 with any other relevant
information, to: Chairman of the Nominating 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 two times in 1995, is composed of three
Directors - Messrs. Gray (Chairman), 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. With the exception of the Executive Committee,
all Committees of the Board of Directors are comprised of
non-employee Directors.
Meetings
The Board of Directors met six times in 1995. 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 EG&G, Inc. 1990 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
1996, each of the eight non-employee Directors who served as
Directors for the entire 1995 calendar year received 800
shares of Common Stock, with a fair market value to each
such Director at that time of $17,700. Mr. Freed and Mr.
Turley, who retired from the Board on April and July of
1995, respectively, received 200 shares with a fair market
value of $4,425 and 400 shares with a fair market value of
$8,850, respectively.
In addition to the foregoing, the Company had a
Deferred Compensation Plan for non-employee Directors. This
Plan was terminated effective December 31, 1995 by the Board
of Directors at its meeting on January 24, 1996. The
termination applies to all current and future non-employee
Directors of the Company but such termination will not
affect any rights of non-employee Directors that have vested
as of such termination date. The Plan provided for an
annual payment to be made by the Company to the eligible
Director or his or her 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 ceased due to
death, retirement, or resignation. Under the Plan as
terminated, annual payments will be made to any current
non-employee Director at the time of his or her death,
retirement, or resignation from the Board for the greater of
five years or the number of years the Director served on the
Board as of December 31, 1995.
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.
<PAGE>
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 January 16, 1996, filed by The Regents of
the University of California and a Schedule 13G dated
February 14, 1996, filed by FMR Corp. with the Securities
and Exchange Commission.
<TABLE>
<CAPTION>
Name and Address Amount and Nature Percent of
of Beneficial of Beneficial Class
Owner Ownership (1)
_______________ _________________ __________
<S> <C> <C>
The Regents of the
University of California
300 Lakeside Drive
Office of the Treasurer
Oakland, CA 94612 3,343,000 (2) 6.95 %
FMR Corp.
82 Devonshire Street
Boston, MA 02109 4,175,937 (3) 8.68 %
<FN>
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 The Regents of the University
of California states that it has sole voting power and sole
dispositive power over 3,343,000 shares.
(3) The Schedule 13G filed by FMR Corp. states that FMR
Corp. has sole dispositive power with respect to 4,175,937
shares held by various investment companies to which FMR
Corp. acts as investment adviser (including 3,209,000 shares
which are held by Fidelity Puritan Fund) and has sole voting
power and sole dispositive power with respect to 11,775
shares held by a subsidiary of FMR Corp.
/TABLE
<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 exercisable within 60 days) on
February 1, 1996, (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>
<CAPTION>
Amount and Nature of Percent
Name Beneficial Ownership of Class
_____________________ ____________________ _________
<S> <C> <C>
John M. Kucharski(1)(2) 356,926 *
James O. Zane(1) 91,520 *
Fred B. Parks(1) 65,461 *
C. Michael Williams(1)(2) 103,484 *
Luciano S. Rossi(1)(2) 73,816 *
Samuel Rubinovitz(1)(2) 90,968 *
William F. Pounds 15,100 *
Kent F. Hansen 4,800 *
Robert F. Goldhammer 14,800 *
John B. Gray 12,600 *
G. Robert Tod 9,800 *
John Larkin Thompson 7,600 *
Greta E. Marshall 4,600 *
Tamara J. Erickson 0 *
Nicholas A. Lopardo 0 *
<FN>
All executive officers, Directors, nominees for Director,
of the Company as a Group, 26 in number, including those listed
above (1)(2)
1,387,837 2.84 %
_____________________
*Less than 1%<PAGE>
NOTES
1) The amounts shown as beneficially owned by Messrs. Kucharski,
Zane, Parks, Williams, Rossi, and Rubinovitz, and by all
executive officers, Directors, and nominees for Director as a
group, include 290,500, 91,100, 59,600, 73,200, 68,300, 79,000,
and 1,071,800 shares, respectively, which are obtainable within
60 days 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, Williams, Rossi, 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 24,726 shares, 20,684 shares, 5,516 shares, 5,390
shares, and 57,486 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.
</TABLE>
<PAGE>
BOARD COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
The Compensation and Stock Option Committee (Committee) of
the Board of Directors is composed of three 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.
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,
Executive Vice 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.
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 25 companies in the S&P High Technology
Composite Index. The S&P High Technology 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.
Generally, the compensation levels of EG&G officers are
comparable with those for similar positions within the
companies included in the above-mentioned surveys.
The salary freeze, in effect for all officers from December
1990 through the end of 1993, was discontinued at the end of
1993. In accordance with the Company's policy to pay
competitive salaries, the base salary of most officers was
increased in January of 1994 and in April of 1995. Mr.
Kucharski's base salary was increased to $650,000 per year
in January 1994. He did not receive a salary increase in
1995 and his recommendation to the Committee that he not
receive a base salary increase in 1996 has been accepted by
the Committee.
Incentive Compensation
EG&G maintains an Economic Value Added ("EVA") Incentive
Plan (the "Plan", or "EVA Plan"), the purpose of which is to
provide incentive compensation to certain key employees.
Mr. Kucharski and most officers, including the other
executive officers named in the Summary Compensation Table,
except for Mr. Zane, are participants in the EVA Plan.
Although the EVA Plan is the primary source of bonuses for
officers, the Committee may award additional bonuses to
selected officers outside of the EVA Plan in circumstances
in which the Committee determines that an additional bonus
determined on a different basis is appropriate.
Bonuses under the EVA Plan are based on the additional
shareholder value created. For purposes of the Plan,
shareholder value is created when the Company earns a return
in excess of the cost of the capital employed. EG&G
calculates its EVA by taking its net operating profit after
tax and subtracting a capital charge. The capital charge is
the result of the capital employed multiplied by the
Company's weighted average cost of capital.
Each EVA Plan participant is assigned a target incentive,
expressed as a percentage of base salary ranging between 5%
and 60%, which represents the amount of incentive award if
EVA performance targets are met. The EVA performance targets
are based on the participant's business unit. Thus, the
performance targets may be based on Division, Segment or
Consolidated performance depending on the participant's
degree of responsibility. The actual incentive award is
determined by multiplying the target incentives by a formula
performance factor based upon actual EVA performance
compared to the target performance. The performance factor
will be greater than one if the EVA target is exceeded and
will be less than one or even negative if the EVA target is
not met. There is no cap and no floor on the incentive
award.
The incentive awards declared in a year for certain
employees are not completely paid out in the following year.
Instead, a percentage of the annual incentive award of all
Company officers, general managers, and certain highly
compensated employees remains in an "at risk" reserve
account. Every year the amount of the incentive award for
an officer is added to the officer's reserve account. Then
a specified percentage of the account is distributed. The
specified percentage is as follows:
1996 80%
1997 67%
1998 57%
1999 & Beyond 50%
Amounts in the reserve account can be lost if performance is
so far below target that a negative award results. Thus, it
is possible for the reserve account to have a negative
balance, although plan participants are not required to
reimburse the Company for negative balances in the reserve
account or for negative awards. In the case of retirement,
disability or death, the balance in the reserve account will
be paid to the participant. The reserve account will be
forfeited (unless determined otherwise by the Company) in
the case of voluntary or involuntary termination and will be
forfeited for breach of any noncompetition agreement. If
there is a Change in Control of the Company (as defined in
the EVA Plan), the Plan will terminate and all positive
balances in reserve accounts distributed unless the Plan is
continued on no less beneficial terms to the participants.
Individual performance factors allow managers to adjust a
participant's final incentive awards up or down by 25% based
upon their discretionary assessment of performance. These
adjustment factors are limited to participants with target
incentive percentages of 5% - 30% of salary.
In 1995, Mr. Kucharski's target bonus was 60% of base
salary. His target EVA was based on Consolidated
performance. For 1995 the actual Consolidated EVA exceeded
his target EVA. As a result, he received an EVA award of
$491,400 which represents 126% of the target bonus.
<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 1996 for performance in 1995 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.
Stock Ownership Program By Officers
The Committee has determined that in order to
further align management and shareholder interests, EG&G
stock ownership by EG&G officers should be significant
relative to each officer's base salary. The market value of
EG&G stock expected to be owned by the Company's officers is
as follows:
CEO 2 times base salary
Executive Vice Presidents 1 1/2 times base salary
Senior Vice Presidents 1 1/2 times base salary
Other Officers 1 times base salary
Those officers who do not presently have such ownership are
expected to attain the ownership within the later of January
1, 2000 or fours years after their election to the specified
officer position.
<PAGE>
Section 162(m)
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 judgment 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.
Compensation and Stock Option Committee
G. Robert Tod (Chairman)
William F. Pounds
Greta E. Marshall
<PAGE>
STOCK PERFORMANCE GRAPH
Set forth below is a line graph comparing the
cumulative total shareholder 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 December 31, 1990 and ended December 31, 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>
<CAPTION>
TOTAL RETURN TO SHAREHOLDERS
REINVESTED DIVIDENDS
Indexed Returns
Year Ending
Company/Index Dec. Dec. Dec. Dec. Dec. Dec.
1990 1991 1992 1993 1994 1995
- --------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
EG&G, Inc. 100 163.99 132.20 126.98 101.02 179.42
S&P 500 Index 100 130.47 140.41 154.56 156.60 215.45
S&P High Tech
Composite Index 100 114.08 118.79 146.13 170.31 245.32
<FN>
* Assumes that the value of the investment in EG&G, Inc. Common Stock
and each index was $100 on December 30, 1990 and that all dividends
were reinvested.
/TABLE
<PAGE>
The following table sets forth information concerning
the annual and long-term compensation for services to the
Company for the 1993, 1994, and 1995 fiscal years, of those
persons who were, at December 31, 1995 (i) the chief
executive officer, and (ii) the other four most highly
compensated executive officers of the Company.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual Compensation Long-Term Compensation
Awards Payouts
Other
Annual Restricted Securities All Other
Name and Compen- Stock Underlying LTIP Compen-
Principal Salary Bonus sation (2) Award(s) Options Payouts sation (3)
Position Year ($) ($)(1) ($) ($) (#) ($) ($)
<S> <C> <C> <C> <C> <C> <C> <C>
John M. Kucharski 1995 650,000 491,400 75,000 30,714
Chairman of the 1994 647,885 0 75,000 33,434
Board, President, 1993 540,020 0 60,000 36,249
and Chief
Executive Officer
James O. Zane 1995 274,976 274,976 0 16,007
Senior Vice 1994 274,476 0 12,500 17,288
President 1993 250,016 0 22,000 19,692
Fred B. Parks 1995 334,984 211,040 50,000 3,371
Executive Vice 1994 333,350 0 35,000 3,300
President and Chief 1993 241,938 70,000 20,000 7,099
Operating Officer
C. Michael 1995 250,016 168,761 19,000 14,079
Williams 1994 249,439 37,300 19,000 15,026
Vice President 1993 220,012 70,000 12,600 17,400
Luciano S. Rossi 1995 220,000 175,725 17,500 5,026
Vice President 1994 220,000 17,400 17,500 4,950
1993 204,880 0 11,600 4,525
<PAGE>
<FN>
NOTES
(1) Twenty percent of each of the incentive awards set forth in the
Bonus Column for the named executive officers, with the exception of Mr.
Zane, is held in an "at risk" reserve account in accordance with the
provisions of the EVA Incentive Plan.
(2) Perquisites 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.
(3) 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, Zane, Parks, Williams, and Rossi is $25,764, $11,127, $71,
$9,129,and $76, 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 1995 for Messrs.
Kucharski, Zane, Parks, Williams, and Rossi includes $4,950, $4,950,
$3,300, $4,950, and $4,950, respectively, as the Company's contribution
to the EG&G, Inc. Savings Plan for the aforementioned executives.
</TABLE>
PENSION PLANS
Employees Retirement Plan
The Company and its subsidiaries maintain several basic retirement
plans for the benefit of their employees, including officers. With
three 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.<PAGE>
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.
<TABLE>
<CAPTION>
PENSION PLAN TABLE
ANNUAL ESTIMATED BENEFITS
UNDER THE EG&G, INC. EMPLOYEES RETIREMENT PLAN(1)(2)
Years of Service
Final Average
Earnings 15 Years 20 Years 25 Years 30 Years 35 Years
<S> <C> <C> <C> <C> <C>
$500,000 $117,084 $120,000 $120,000 $120,000 $120,000
475,000 111,084 120,000 120,000 120,000 120,000
450,000 105,084 120,000 120,000 120,000 120,000
400,000 93,084 120,000 120,000 120,000 120,000
375,000 87,084 116,112 120,000 120,000 120,000
350,000 81,084 108,112 120,000 120,000 120,000
325,000 75,084 100,112 120,000 120,000 120,000
300,000 69,084 92,112 115,140 120,000 120,000
275,000 63,084 84,112 105,140 120,000 120,000
250,000 57,084 76,112 95,140 114,168 120,000
225,000 51,084 68,112 85,140 102,168 119,196
200,000 45,084 60,112 75,140 90,168 105,196
175,000 39,084 52,112 65,140 78,168 91,196
150,000 33,084 44,112 55,140 66,168 77,196
125,000 27,084 36,112 45,140 54,168 63,196
100,000 21,084 28,112 35,140 42,168 49,196
75,000 15,084 20,112 25,140 30,168 35,196
50,000 9,084 12,112 15,140 18,168 21,196
<PAGE>
<FN>
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, 1995, 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.
(2)Messrs. Kucharski, Zane, Parks, Williams, and Rossi have respectively
30, 3, 19, 30, and 9 years of credited service under the EG&G, Inc.
Employees Retirement Plan; and $150,000 of the 1995 compensation of each
of Messrs. Kucharski, Zane, Parks, Williams, and Rossi 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.
</TABLE>
<PAGE>
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, 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 1995, the Company charged $1,465,350 as an expense and
$651,847 as income for the Supplemental Plan and made payments to
retired officers and beneficiaries in the amount of $429,255. 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, 1995, the Trust had a
balance of $7,262,822. 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.
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.
<PAGE>
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, Zane, and Williams 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 and Williams would receive $361,857 and $137,227,
respectively, assuming they retired on the last day of 1995 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 $160,015, assuming he retired on the last day of 1995 and
received benefits in the form of a lifetime income. Mr. Zane did retire
from the Company effective January 1, 1996.
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 1995 of $650,000. Compensation
in the form of salary to Messrs. Zane, Parks, Williams, and Rossi is paid
pursuant to one-year employment agreements with the Company dated November
1, 1993, automatically renewable for successive 1-year intervals, which
provided for minimum annual payments in 1995 of $275,000, $335,000,
$250,000, and $220,000, 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;
<PAGE>
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 September 1995 and January 1996, respectively, the Company
entered into agreements with Mr. James Dubay and Mr. Donald Michel, then
Company Vice Presidents, relating to the terms of their separation from
the Company. Pursuant to the agreements, the Company paid to Mr. Dubay
and Mr. Michel lump sum severance payments of $390,000 and $185,000,
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
$6,000 in 1995 for services rendered pursuant to the consulting agreement.
<PAGE>
OPTION GRANTS
The following table sets forth information on grants made in Fiscal
Year 1996 of stock options pursuant to the EG&G, Inc. 1992 Stock Option
Plan, for performance during the fiscal year ended December 31, 1995, to
the officers identified in the Summary Compensation Table. No stock
appreciation rights were granted under that Plan during the last fiscal
year or in 1996 for performance during the last fiscal year.
<TABLE>
<CAPTION>
OPTION GRANTS TABLE
OPTION GRANTS IN 1996 (1)
FOR PERFORMANCE IN LAST FISCAL YEAR
GRANT
DATE
INDIVIDUAL GRANTS VALUE(2)
- ---------------------------------------------------------------------------------------------------------------------------------
NUMBER OF % OF TOTAL
SECURITIES OPTIONS EXERCISE GRANT
UNDERLYING GRANTED TO OR BASE DATE
OPTIONS EMPLOYEES PRICE PER PRESENT
GRANTED IN FISCAL SHARE(3) EXPIRATION VALUE(2)
NAME (#) YEAR ($) DATE ($)
<S> <C> <C> <C> <C> <C>
John M. Kucharski 75,000 11.3% 21.75 1/19/06 594,750
James O. Zane 0 0 -- -- 0
Fred B. Parks 50,000 7.5% 21.75 1/19/06 396,500
C. Michael Williams 19,000 2.9% 21.75 1/19/06 150,670
Luciano S. Rossi 17,500 2.6% 21.75 1/19/06 138,755
<FN>
NOTES
(1) All options granted by the Company in 1996 for performance in 1995
to the officers identified above are non-statutory options and vest in
20% increments over a period of five (5) years. The options become
fully vested and immediately exercisable upon the death of the optionee
while in the employ of the Company; upon termination of the optionee's
employment due to permanent and total disability or upon retirement at a
Company-recognized retirement age; or upon a change in control of the
Company.
(2) The Black-Scholes option pricing model was chosen to estimate the
grant date present value of the options set forth in this table. The
assumptions used at the time of grant in January of 1996 included
expected market volatility of 25.9%, a 7.5% risk-free rate of return, a
2.7% dividend yield, and a 10-year exercise period.
(3) The exercise or base price is equal to the fair market value of
the Common Stock as determined by the closing price on the New York
Stock Exchange-Composite Transactions on January 19, 1996, the date of
grant.
</TABLE>
<PAGE>
Option Exercises and Fiscal Year-End Values
The following table sets forth information with respect to option
exercises during the 1995 fiscal year and the number and value of
unexercised options to purchase the Company's Common Stock held by the
officers named in the Summary Compensation Table at the end of the 1995
fiscal year.
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL
YEAR-END OPTION VALUE TABLE
Number of
Securities Value of
Underlying Unexercised
Unexercised In-The-Money
Shares Options at Options at
Acquired Value FY-End FY-End
on Exercise Realized (#) ($)
Name (#) ($) Exercisable/ Exercisable/
Unexercisable Unexercisable
(1) (1)(2)
<S> <C> <C> <C> <C>
John M. Kucharski 0 0 298,000/60,000 1,524,312/603,750
James O. Zane 0 0 91,100/10,000 414,131/100,625
Fred B. Parks 0 0 59,600/28,000 226,050/281,750
C. Michael Williams 0 0 73,200/15,200 384,638/152,950
Luciano S. Rossi 0 0 68,300/14,000 362,206/140,875
<FN>
(1) Does not reflect options granted in 1996 for 1995 performance.
(2) 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 29, 1995 ($24.3125).
</TABLE>
<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 24, 1996, 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 1996.
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 1997 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, 1996.
By Order of the Board of Directors
MURRAY GROSS, Clerk
Wellesley, Massachusetts
March 7, 1996
DETACH HERE EGG EGG DETACH HERE
EG&G, INC.
P THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
R For Annual Meeting of Stockholders April 23, 1996
O
X The undersigned hereby appoints John M. Kucharski and Murray Gross,
Y 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 23, 1996, 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 eleven and to elect William F.
Pounds, Robert F. Goldhammer, G. Robert
Tod, Greta E. Marshall, Tamara J.
Erickson, Nicholas A. Lopardo and Fred B.
Parks for terms of one year 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>
[ X ] 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 eleven and the election of Directors.
_______________________________________
| 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).
_________________________
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>
