<PAGE>
================================================================================
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [ ]
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 Section 240.14a-11(c) or Section 240.14a-12
FLIR SYSTEMS, 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] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------------
(3) Filing Party:
-------------------------------------------------------------------------
(4) Date Filed:
-------------------------------------------------------------------------
Notes:
<PAGE>
[LOGO OF FLIR SYSTEMS]
16505 S.W. 72nd Avenue
Portland, Oregon 97224
(503) 684-3731
----------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON AUGUST 15, 2000
----------------
To the Shareholders of FLIR Systems, Inc.:
NOTICE IS HEREBY GIVEN that the annual meeting of shareholders (the "Annual
Meeting") of FLIR Systems, Inc. (the "Company") will be held on Tuesday,
August 15, 2000, at 2:00 p.m., at the Multnomah Athletic Club, 1849 S.W.
Salmon Street, Portland, Oregon 97205 for the following purposes:
1. Election of Directors. To elect three directors, each for a three-year
term; and
2. Other Business. To transact such other business as may properly come
before the meeting or any adjournments thereof.
The Board of Directors of the Company has fixed the close of business on
June 19, 2000 as the record date for the determination of shareholders
entitled to notice of and to vote at the Annual Meeting. Only shareholders of
record at the close of business on that date will be entitled to notice of and
to vote at the Annual Meeting or any adjournments thereof.
By Order of the Board,
/s/ John C. Hart
John C. Hart
President, Chief Executive Officer
and Director
Portland, Oregon
July 19, 2000
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, WHETHER OR
NOT YOU PLAN TO BE PRESENT IN PERSON AT THE ANNUAL MEETING, PLEASE DATE,
SIGN AND COMPLETE THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE,
WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
<PAGE>
FLIR SYSTEMS, INC.
16505 S.W. 72nd Avenue
Portland, OR 97224
(503) 684-3731
----------------
PROXY STATEMENT
for the
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON AUGUST 15, 2000
----------------
INTRODUCTION
General
This Proxy Statement is being furnished to the shareholders of FLIR Systems,
Inc., an Oregon corporation ("FLIR" or the "Company"), as part of the
solicitation of proxies by the Company's Board of Directors (the "Board of
Directors") from holders of the outstanding shares of FLIR common stock, par
value $0.01 per share (the "Common Stock"), for use at the Company's Annual
Meeting of Shareholders to be held on August 15, 2000, and at any adjournments
or postponements thereof (the "Annual Meeting"). At the Annual Meeting,
shareholders will be asked to elect three members of the Board of Directors
and transact such other business as may properly come before the meeting or
any adjournments thereof. This Proxy Statement, together with the enclosed
proxy card, is first being mailed to shareholders of FLIR on or about July 19,
2000.
Solicitation, Voting and Revocability of Proxies
The Board of Directors has fixed the close of business on June 19, 2000 as
the record date for the determination of the shareholders entitled to notice
of and to vote at the Annual Meeting. Accordingly, only holders of record of
shares of Common Stock at the close of business on such date will be entitled
to vote at the Annual Meeting, with each such share entitling its owner to one
vote on all matters properly presented at the Annual Meeting. On the record
date, there were approximately 3,500 beneficial holders of the 14,431,497
shares of Common Stock then outstanding. The presence, in person or by proxy,
of a majority of the total number of outstanding shares of Common Stock
entitled to vote at the Annual Meeting is necessary to constitute a quorum at
the Annual Meeting.
If the enclosed form of proxy is properly executed and returned in time to
be voted at the Annual Meeting, the shares represented thereby will be voted
in accordance with the instructions marked thereon. Executed but unmarked
proxies will be voted FOR the election of the three nominees for election to
the Board of Directors. The Board of Directors does not know of any matters
other than those described in the Notice of Annual Meeting that are to come
before the Annual Meeting. If any other matters are properly brought before
the Annual Meeting, the persons named in the proxy will vote the shares
represented by such proxy upon such matters as determined by a majority of the
Board of Directors.
The presence of a shareholder at the Annual Meeting will not automatically
revoke such shareholder's proxy. A shareholder may, however, revoke a proxy at
any time prior to its exercise by filing a written notice of revocation with,
or by delivering a duly executed proxy bearing a later date to, Corporate
Secretary, FLIR Systems, Inc., 16505 S.W. 72nd Avenue, Portland, Oregon 97224,
or by attending the Annual Meeting and voting in person. However, a
shareholder who attends the meeting need not revoke a previously executed
proxy and vote in person unless such shareholder wishes to do so. All valid,
unrevoked proxies will be voted at the Annual Meeting.
1
<PAGE>
ELECTION OF DIRECTORS
At the Annual Meeting three directors will be elected, each for a three-year
term. Unless otherwise specified on the proxy, it is the intention of the
persons named in the proxy to vote the shares represented by each properly
executed proxy for the election as directors of the persons named below as
nominees. The Board of Directors believes that the nominees will stand for
election and will serve if elected as directors. However, if any of the
persons nominated by the Board of Directors fails to stand for election or is
unable to accept election, the number of directors constituting the Board of
Directors may be reduced prior to the Annual Meeting or the proxies may be
voted for the election of such other person as the Board of Directors may
recommend.
Under the Company's articles of incorporation and bylaws, the directors are
divided into three classes. The term of office of only one class of directors
expires in each year, and their successors are elected for terms of three
years and until their successors are elected and qualified. There is no
cumulative voting for election of directors.
In December 1997, we acquired all of the outstanding shares of capital stock
of AGEMA Infrared Systems AB in exchange for a total of 4,162,000 shares of
our Common Stock. This acquisition was completed effective as of
December 1, 1997 pursuant to the terms of a Combination Agreement dated as of
October 6, 1997 by and among FLIR and Spectra-Physics AB ("Spectra") and
certain of Spectra's affiliates (together the "Spectra Companies"). Pursuant
to the terms of the Combination Agreement, we agreed to use our reasonable
best efforts to cause three persons designated by Spectra to be elected to the
Board of Directors, and to cause the number of designees of Spectra serving on
the Board of Directors to be maintained at the number described below: (i)
three designees if on the date of mailing of the notice for the annual
shareholder meeting where such directors shall be up for election, the Spectra
Companies own thirty percent (30%) or more of the then issued and outstanding
shares of Common Stock, (ii) two designees if on the date of mailing of the
notice for the annual shareholder meeting where such directors shall be up for
election, the Spectra Companies own less than thirty percent (30%) but more
than or equal to twenty percent (20%) of the then issued and outstanding
shares of Common Stock, and (iii) one designee if on the date of mailing of
the notice for the annual shareholder meeting where such directors shall be up
for election, the Spectra Companies own less than twenty percent (20%) but
more than or equal to ten percent (10%) of the then issued and outstanding
shares of Common Stock. If at some point in the future the Spectra Companies
own less than ten percent (10%) of the then issued and outstanding shares of
Common Stock, the Spectra Companies shall no longer be entitled to the rights
described above.
In February 1999, Thermo Instrument Systems Inc., a subsidiary of Thermo
Electron Corporation, acquired substantially all of the outstanding capital
stock of Spectra. As a result of such acquisition, Thermo Electron became the
beneficial owner of the 4,162,000 shares of Common Stock owned by Spectra and
its affiliates. Lars Spongberg, Patrick L. Edsell and Egon Linderoth, who were
elected to the Board of Directors at the 1998 Annual Meeting as designees of
Spectra, resigned in May of 1999 at Thermo Electron's request. Earl R. Lewis
was elected to the Board of Directors in June 1999 as a designee of
Spectra/Thermo Electron. These shares represent approximately 28.8% of the
shares of Common Stock outstanding as of June 19, 2000. By virtue of its stock
ownership position and Board representation, Thermo Electron will be able to
significantly influence our direction and policies, the election of our Board
of Directors and the outcome of any other matter requiring shareholder
approval, including any merger, consolidation, sale of substantially all of
our assets and other change of control transaction.
2
<PAGE>
Information as to Nominees and Continuing Directors. The following table
sets forth the names of the Board of Directors' nominees for election as a
director and those directors who will continue to serve after the Annual
Meeting. Also set forth is certain other information with respect to each such
person's age at April 25, 2000, principal occupation or employment during the
past five years, the periods during which he has served as a director of FLIR,
the expiration of his term as a director and the positions currently held with
FLIR.
<TABLE>
<CAPTION>
Director Expiration
Nominees: Age Since of Term Position Held with FLIR
--------- --- -------- ---------- -----------------------
<C> <C> <C> <S> <C>
Earl R. Lewis 55 1999 2000 Director
Ronald L. Turner 53 1993 2000 Director
Steven E. Wynne 47 2000 2000 Director
<CAPTION>
Continuing Directors:
---------------------
<C> <C> <C> <S> <C>
W. Allen Reed 52 1992 2001 Director
J. Kenneth Stringer III 47 1993 2001 Director, former President and Chief Executive Officer
Robert P. Daltry 56 1987 2002 Chairman of the Board of Directors
John C. Hart 66 1987 2002 Director, acting President and Chief Executive Officer
</TABLE>
Robert P. Daltry. Mr. Daltry joined the Company in 1987 as President and
Chief Executive Officer and a member of the Board of Directors. He was elected
Chairman of the Board of Directors in April 1993. He served as Chief Executive
Officer until December 1998. From 1984 to 1987, Mr. Daltry was employed by
Lear Siegler, Inc., an aerospace company, where he served as Vice President of
Marketing for the Instrument and Avionics Systems Division. From 1981 to 1984,
Mr. Daltry served as Regional Manager for Singer-Kearfott, an aerospace
company. Mr. Daltry holds a B.A. in Accounting from Grove City College.
John C. Hart. Mr. Hart has served as a Director of the Company since
February 1987 and as Chairman of the Board of Directors from 1987 to April
1993. Mr. Hart was named acting President and Chief Executive Officer of the
Company in May 2000. From 1982 until his retirement in 1993, Mr. Hart served
as Vice President of Finance, Treasurer and a member of the Board of Directors
of Louisiana-Pacific Corporation.
Earl R. Lewis. Mr. Lewis was elected to the Board in June 1999 in connection
with the acquisition of Spectra Physics AB by Thermo Instrument Systems Inc.
Mr. Lewis' current term on the Board of Directors expires in 2000. Mr. Lewis
is President and Chief Executive Officer of Thermo Instrument Systems and has
served in such capacities since March 1997 and January 1998, respectively. Mr.
Lewis is also Chief Operating Officer, Measurement and Detection, of Thermo
Electron Corporation, the parent company of Thermo Instrument Systems, and is
Chairman of the Board of several subsidiaries of Thermo Electron, including
Thermo Optek Corporation, Thermo Quest Corporation, Thermo Vision Corporation,
Thermo BioAnalysis Corporation and ONIX Systems Inc., and is a director of
Metrika Systems Corporation, ThermoSpectra Corporation and Thermo Instrument
Systems. Mr. Lewis is also a director of SpectRx Inc. Mr. Lewis holds a B.S.
from Clarkson College of Technology and has attended postgraduate programs at
the University of Buffalo, Northeastern University and Harvard University.
Ronald L. Turner. Mr. Turner was elected to the Board of Directors in 1993.
Mr. Turner was appointed Chairman of Ceridian Corporation in May 2000. He
served as President and Chief Executive Officer of Ceridian since January
2000, President and Chief Operating Office since 1998 and Executive Vice
President, Operations since 1997. From 1993 to 1997, Mr. Turner served as
President and Chief Executive Officer of Computing Devices International, an
aerospace company, which was a division of Ceridian Corporation. From 1987 to
1993, Mr. Turner was President and Chief Executive Officer of GEC-Marconi
Electronic Systems Corporation, a defense electronic company. Prior to 1987,
Mr. Turner worked for Martin Marietta Corporation for 14 years in a variety of
executive positions. Mr. Turner serves on the Board of Directors of Ceridian
Corporation, BTG, Inc., Government Electronics and Information Technology
Association and is Vice Chairman of the Electronics Industries Alliance and is
on its Executive Committee and Board of Governors. He is also a past President
and a member of the Board of Governors of the Massachusetts Institute of
Technology Society of Sloan Fellows.
3
<PAGE>
W. Allen Reed. Mr. Reed has served as a Director of the Company since April
1992. Mr. Reed is President of General Motors Investment Management
Corporation. From 1991 to 1994, Mr. Reed was Vice President and Treasurer of
GM Hughes Electronics Corporation and Hughes Aircraft Company ("Hughes"). From
1984 to 1991, Mr. Reed was President of the Hughes Investment Management
Company, a wholly owned subsidiary of Hughes. Prior to joining Hughes, Mr.
Reed was Vice President and Portfolio Manager for Allen & Associates
Investment Management Company. Mr. Reed serves on the Boards of Directors of
WEBS Fund, Inc., Temple-Inlands Industries, General Motors Acceptance
Corporation and GMAC Insurance Holdings. Mr. Reed also serves as Chairman of
the Investment Advisory Committee for the Howard Hughes Medical Institute.
J. Kenneth Stringer III. Mr. Stringer joined the Company in 1984 as Vice
President of Finance and Chief Financial Officer and was appointed Executive
Vice President in 1990. Mr. Stringer was elected to the Board of Directors in
April 1993. In April 1995, Mr. Stringer was appointed President and Chief
Operating Officer. In December 1998, Mr. Stringer was appointed Chief
Executive Officer. Mr. Stringer served as President and Chief Executive
Officer until May 2000. Prior to joining the Company, Mr. Stringer spent six
years with Evans Products Company, Portland, Oregon, as Director of Financial
Reporting. He started his career with Touche Ross and Company (which
subsequently became Deloitte & Touche). Mr. Stringer received his B.S. degree
from the University of Oregon.
Steven E. Wynne. Mr. Wynne was elected to the Board of Directors in November
1999 and his current term on the Board of Directors expires in 2000. Mr. Wynne
is currently the Chief Executive Officer of eteamz.com, Inc, an on-line
community serving amateur sports. From February 1995 to March 2000, Mr. Wynne
has served as President and Chief Executive Officer of adidas America, Inc..
Prior to that time, he was a partner in the law firm of Ater Wynne LLP. Mr.
Wynne received an undergraduate degree from Willamette University and a J.D.
from Willamette University. Mr. Wynne also serves on the Board of Directors of
Protocol Systems, Inc. and the Board of Directors of Planar Systems, Inc.
Board of Directors Committees and Nominations by Shareholders. The Board of
Directors acts as a nominating committee for selecting nominees for election
as directors. The Company's bylaws also permit shareholders to make
nominations for the election of directors, if such nominations are made
pursuant to timely notice in writing to the Company's Secretary. To be timely,
notice must be delivered to, or mailed to and received at, the principal
executive offices of the Company not less than 60 days nor more than 90 days
prior to the date of the meeting, provided that at least 60 days notice or
prior public disclosure of the date of the meeting is given or made to
shareholders. If less than 60 days notice or prior public disclosure of the
date of the meeting is given or made to shareholders, notice by the
shareholder to be timely must be received by the Company not later than the
close of business on the tenth day following the date on which such notice of
the date of the meeting was mailed or such public disclosure was made. A
shareholder's notice of nomination must also set forth certain information
specified in the Company's bylaws concerning each person the shareholder
proposes to nominate for election and the nominating shareholder.
The Board of Directors has appointed a standing Audit Committee. The members
of the Audit Committee currently are Messrs. Hart, Lewis, Reed and Wynne. The
Audit Committee reviews the scope of the independent annual audit, the
independent public accountants' letter to the Board of Directors concerning
the effectiveness of the Company's internal financial and accounting controls
and management's response to that letter, if deemed necessary. The audit
committee met four times during the fiscal year ended December 31, 1999. The
Board of Directors also has appointed a Compensation Committee that reviews
executive compensation and makes recommendations to the full Board regarding
changes in compensation, and also administers the Company's stock option
plans. During the fiscal year ended December 31, 1999, the Compensation
Committee held four meetings. The members of the Compensation Committee
currently are Messrs. Hart and Turner.
During 1999 the Company's Board of Directors held five meetings. Each
incumbent director attended more than 75% of the aggregate of the total number
of meetings held by the Board of Directors and the total number of meetings
held by all committees of the Board on which he served during the period that
he served.
See "Management--Executive Compensation" for certain information regarding
compensation of directors.
4
<PAGE>
The Board of Directors unanimously recommends that shareholders vote FOR the
election of its nominees for director. If a quorum is present, the Company's
bylaws provide that directors are elected by a plurality of the votes cast by
the shares entitled to vote. Abstentions and broker non-votes are counted for
purposes of determining whether a quorum exists at the Annual Meeting, but are
not counted and have no effect on the determination of whether a plurality
exists with respect to a given nominee.
MANAGEMENT
Executive Officers
The executive officers of the Company are as follows:
<TABLE>
<CAPTION>
Name Age Position
---- --- --------
<S> <C> <C>
Robert P. Daltry........ 56 Chairman of the Board of Directors
John C. Hart............ 66 President, Chief Executive Officer and Director
Arne Almerfors.......... 55 Executive Vice President
Stephen M. Bailey....... 51 Senior Vice President, Finance and Chief Financial Officer
James A. Fitzhenry...... 44 Senior Vice President, General Counsel and Secretary
William A. Sundermeier.. 36 Senior Vice President, Product Strategy
Andrew C. Teich......... 38 Senior Vice President, Sales and Marketing
Jay S. Teich............ 45 Senior Vice President, Boston Operations
</TABLE>
Information concerning the principal occupation of Mr. Daltry is set forth
under "Election of Directors." Information concerning the principal occupation
during the last five years of the executive officers of the Company who are
not also directors of the Company is set forth below.
Arne Almerfors. Mr. Almerfors joined FLIR in December 1997 in connection
with FLIR's acquisition of AGEMA, and currently serves as Executive Vice
President. From 1995 to 1997, Mr. Almerfors was President and Chief Executive
Officer AGEMA. He also served as President and Chief Executive Officer of CE
Johansson AB, a manufacturer of coordinate measuring devices, from 1989 to
1995. Mr. Almerfors received his B.S. and MBA from the University of
Stockholm. Mr. Almerfors received a Masters in Political Science in addition
to post-graduate courses in corporate finance and accounting from the
University of Stockholm.
Stephen M. Bailey. Mr. Bailey joined FLIR in April 2000 as Senior Vice
President, Finance and Chief Financial Officer. Since 1989, Mr. Bailey has
served as Vice President and Chief Financial Officer of Bauce Communications,
Inc., President of Pro Golf of Portland, Inc., and Chief Financial Officer and
Chief Operating Officer of Desk2Web Technologies, Inc. From 1975 to 1988, Mr.
Bailey served in various senior executive positions with Amfac, Inc.,
including Senior Vice President and Controller of Amfac Foods, Inc., President
of Amfac Supply Company and as Senior Vice President and Controller of Amfac,
Inc. A CPA, Mr. Bailey also worked at Touch Ross & Company. (which
subsequently became Deloitte & Touche) from 1970 to 1975. Mr. Bailey received
his B.S. degree from Oregon State University.
James A. Fitzhenry. Mr. Fitzhenry joined FLIR in 1993 as Corporate Counsel
and Director of Administration, and was appointed Senior Vice President,
General Counsel and Secretary in 1995. From 1990 to 1993, Mr. Fitzhenry served
in the White House during the Bush Administration in the Office of Policy
Development and the Office of Cabinet Affairs. Previously, he served as legal
counsel and legislative director to Senator Mark O. Hatfield (R-Ore.) and
practiced law in Portland, Oregon. Mr. Fitzhenry received his B.A. from the
University of Oregon and received his J.D. and MBA degrees from Willamette
University.
William A. Sundermeier. Mr. Sundermeier joined FLIR in 1994 as Product
Marketing Manager and was appointed Director of Product Marketing in 1995. Mr.
Sundermeier currently serves as the Senior Vice President of Product
Marketing. Prior to joining FLIR, Mr. Sundermeier was a founder of Quality
Check
5
<PAGE>
Software, Inc. (QCS) in 1993. From 1985 to 1993, Mr. Sundermeier served as
Product Line Manager at Cadre Technologies, Inc. Mr. Sundermeier also served
as Software/Hardware Engineer at Tektronix, Inc. from 1980 to 1985. Mr.
Sundermeier received his B.S. in Computer Science from Oregon State
University.
Andrew C. Teich. Mr. Teich joined FLIR in March 1999 as Senior Vice
President of Marketing. From 1996, Mr. Teich served as Vice President of Sales
and Marketing at Inframetrics, Inc. Inframetrics was acquired by FLIR in March
1999. From 1984 to 1996, Mr. Teich served in the capacities of Sales Engineer,
Western Regional Sales Manager, International Sales Manager and Vice President
of Sales at Inframetrics. He holds an A.S. degree in Industrial Design from
the University of Bridgeport and received his B.S. in Marketing from Arizona
State University.
Jay S. Teich. Mr. Teich joined FLIR in March 1999 as Senior Vice President
of Boston Operations. From 1991 to 1999, Mr. Teich was Vice President and
later President of Inframetrics, Inc. Inframetrics was acquired by FLIR in
March 1999. Mr. Teich joined Inframetrics in 1981 as an engineering manager.
He received his BSEE from Lehigh University and is an M.I.T. graduate in
Engineering and Mathematics.
6
<PAGE>
EXECUTIVE COMPENSATION
Summary of Cash and Certain Other Compensation
The following table provides information concerning the compensation of the
Company's Chief Executive Officer and each of the four other most highly
compensated executive officers of the Company (the "named executive officers")
for the fiscal years ending December 31, 1999, 1998 and 1997 or such periods
as the named executive officer was an officer of the Company.
<TABLE>
<CAPTION>
Annual Compensation Long-term Compensation
---------------------- ----------------------
Stock Long-term
Name and Principal Options Incentive Plan All
Position Year Salary Bonus Granted Payouts (1) Other (2)
------------------ ---- -------- -------- ------- -------------- ---------
<S> <C> <C> <C> <C> <C> <C>
Robert P. Daltry........ 1999 $256,406 $ 0 30,000 $ 0 $5,000
Chairman of the Board of 1998 271,202 230,000 30,000 320,065 5,000
Directors 1997 252,872 122,500 25,500 607,500 4750
J. Kenneth Stringer
III(3)................. 1999 276,000 0 30,000 82,192 5,000
Director, Former 1998 225,726 180,000 25,000 240,049 5,000
President and Chief 1997 216,292 99,000 20,000 455,625 4,750
Executive Officer
Jay S. Teich(4)......... 1999 196,859 0 25,000 20,548 5,000
Senior Vice President,
Boston Operations
William N. Martin(5).... 1999 187,351 0 12,000 54,794 --
Former Senior Vice 1998 178,500 40,000 12,000 80,016 --
President, Sales 1997 174,484 50,000 11,000 151,875 --
James A. Fitzhenry...... 1999 170,689 0 12,000 54,794 5,000
Senior Vice President, 1998 159,579 55,000 12,000 80,016 5,000
General Counsel and 1997 149,391 40,000 11,000 151,875 4,750
Secretary
</TABLE>
--------
(1) The amounts set forth under Long-term Incentive Plan Payouts represent
the dollar value of shares of restricted stock that were earned in 1997,
1998 and 1999 based upon achievement of specified performance goals. The
value of these shares was calculated based upon the closing price of the
Common Stock on February 3, 1998, October 7, 1998 and October 21, 1999,
respectively.
(2) The amounts set forth under All Other Compensation represent matching
amounts contributed on behalf of the named executive officers to the
Company sponsored 401(k) employee savings and retirement plan covering
all of the Company's employees.
(3) Mr. Stringer served as President and Chief Executive Officer until May
2000.
(4) Mr. Teich joined the Company in March 1999.
(5) Mr. Martin served as Senior Vice President, Sales until July 2000.
7
<PAGE>
Stock Options
The following table sets forth information concerning options granted to the
named executive officers during the year ended December 31, 1999 under the
Company's stock options plans:
<TABLE>
<CAPTION>
Potential
Realizable Value
at Assumed Annual
Percent of Rates of Stock
Number of Total Price
Securities Options Appreciation for
Underlying Granted to Exercise Option Term (2)
Options Employees Price Expiration -----------------
Name Granted (1) in 1998 Per Share Date 5% 10%
---- ----------- ---------- --------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Robert P. Daltry........ 30,000 5.9% $17.13 03/05/09 $323,095 $818,785
J. Kenneth Stringer III. 30,000 5.9% $17.13 03/05/09 323,095 818,785
Jay S. Teich............ 25,000 4.9% $18.50 03/31/09 290,864 737,106
William N. Martin....... 12,000 2.3% $17.13 03/05/09 129,238 327,514
James A. Fitzhenry...... 12,000 2.3% $17.13 03/05/09 129,238 327,514
</TABLE>
--------
(1) Options granted in 1999 become exercisable starting 12 months after the
grant date, with one-third of the options becoming exercisable at that
time and with an additional one-third of the options becoming exercisable
on the second and third anniversary dates of the option grant,
respectively.
(2) The amounts shown are hypothetical gains based on the indicated assumed
rates of appreciation of the Common Stock compounded annually for a ten-
year period. Actual gains, if any, on stock option exercises are dependent
on the future performance of the Common Stock and overall stock market
conditions. There can be no assurance that the Common Stock will
appreciate at any particular rate or at all in future years.
Options Exercised in Last Fiscal Year and Fiscal Year End Option Values
The following table sets forth, for each of the named executive officers,
the shares acquired during 1999 and the related value realized, and the number
and value of unexercised options as of December 31, 1999.
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised In-
Options Exercised Underlying Unexercised the-Money Options at
in Last Fiscal Year(1) Options at December 31, 1999 December 31, 1999(2)
------------------------- ---------------------------- -------------------------
Number of Value
Shares Realized Exercisable Unexercisable Exercisable Unexercisable
----------- ------------ -------------- --------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Robert P. Daltry........ 0 $ 0 150,667 58,333 $960,167 $20,833
J. Kenneth Stringer III. 0 0 95,517 53,333 499,580 16,667
Jay S. Teich............ 37,406 486,055 0 25,000 0 0
William N. Martin....... 6,667 35,000 7,666 23,667 9,166 9,167
James A. Fitzhenry...... 0 0 10,999 23,667 23,538 9,167
</TABLE>
--------
(1) The value realized is based on the difference between the market price at
the time of exercise of the options and the applicable exercise price.
(2) The value of unexercised in-the-money options is based on the difference
between $16.25, which was the closing price of the Common Stock on
December 31, 1999, and the applicable exercise price.
Employment Agreements
FLIR has entered into employment agreements (the "Employment Agreements")
with certain of its executive officers, including Robert P. Daltry, J. Kenneth
Stringer III, Arne Almerfors, and James A. Fitzhenry. Each of the Employment
Agreements is for a term ending December 31, 2001, provided that if a Change
of Control (as defined) occurs before December 31, 2001, the Employment
Agreements will continue in effect until two years after the Change in
Control. If the executive officer resigns voluntarily or is properly
terminated for Cause (as defined) all pay and benefits under the Employment
Agreement will cease as of the effective date of the termination or
resignation. In the event of the death of an executive officer, the designated
beneficiary of the
8
<PAGE>
executive officer would receive a lump sum payment equal to twelve months base
salary at the then current rate. With respect to Messrs. Daltry and Stringer,
in the event that the employment of such executive officer is terminated by
the Company without cause, such executive officer would be entitled to receive
a lump sum payment in an amount equal to two year's base salary plus bonuses
earned through the date of termination. For a period of two years following
the Change of Control, each executive officer would have the right to
terminate his employment for Good Reason (as defined), and to receive upon
such termination a lump sum payment in an amount equal to two times (three
times in the case of Messrs. Daltry and Stringer) their average annualized
compensation during the five year period preceding the Change of Control. In
addition, the executive officers would be entitled to the continuation of
health and insurance benefits for certain periods. For purposes of the
Employment Agreements, a "Change of Control" includes (i) any merger or
consolidation transaction that results in the shareholders of the Company
immediately before such transaction owning less than 50 percent of the total
combined voting power of the surviving corporation in the transaction, (ii)
the acquisition by any person of 20 percent or more of the Company's total
combined voting power, (iii) the liquidation of the Company of the sale of
substantially all of its assets, and (iv) a change in the composition of the
Board of Directors during any 24 month period such that the directors in
office at the beginning of the period and/or their successors who were elected
by or on the recommendation of the directors in office at the beginning of the
period do not constitute at least a 70 percent majority of the Board. In
connection with the Company's acquisition of AGEMA, the Employment Agreements
were amended to provide that the consummation of that transaction would not
constitute a Change of Control for purposes of the Employment Agreements. This
amendment to the Employment Agreements will terminate and become null and void
upon the acquisition by Spectra-Physics AB and/or its affiliates of any shares
of Common Stock if at the time of such acquisition Spectra and its affiliates
would beneficially own more than 45 percent of the issued and outstanding
shares of Common Stock. In connection with the acquisition by an affiliate of
Thermo Electron Corporation of substantially all of the outstanding capital
stock of Spectra, the Employment Agreements were amended to provide that the
consummation of that transaction would not constitute a Change of Control for
purposes of the Employment Agreements. This amendment to the Employment
Agreements will terminate and become null and void if (i) Thermo Electron
Corporation acquires any shares of Common Stock in excess of those shares held
by Spectra, or (ii) asserts any right to representation on the Board of
Directors. For purposes of the Employment Agreements, "Cause" means the
failure to satisfactorily perform the duties assigned to the executive officer
within a certain period after notice of such failure is given and commission
of certain illegal or wrongful acts.
FLIR has also entered into an employment agreement with Jay S. Teich. The
agreement is for a term ending December 31, 2000 and provides for an annual
base salary of $243,810 and a cash bonus in the amount of $100,000 payable by
May 31, 2000. During the term of the agreement, Mr. Teich may resign his
employment upon giving four weeks' notice in writing. If such notice is
received prior to September 30, 2000, Mr. Teich will be entitled to severance
of his monthly base salary through the end of September 2000.
Director Compensation
The members of the Company's Board of Directors are not compensated for
their service on the Board, but are reimbursed for out-of-pocket and travel
expenses incurred in attending Board meetings. Under the Company's 1993 Stock
Option Plan for Nonemployee Directors, as amended, an option to purchase 6,000
shares of Common Stock is automatically granted to each nonemployee director
each year on the day of the Annual Meeting.
Compensation Committee Report
Under rules established by the Securities and Exchange Commission (the
"SEC"), the Company is required to provide certain data and information in
regard to the compensation and benefits provided to the Company's Chairman of
the Board of Directors and Chief Executive Officer and the four other most
highly compensated executive officers. In fulfillment of this requirement, the
Compensation Committee, at the direction of the Board of Directors, has
prepared the following report for inclusion in this Proxy Statement.
9
<PAGE>
Executive Compensation Philosophy. The Compensation Committee of the Board
of Directors is composed entirely of outside directors. The Compensation
Committee is responsible for setting and administering the policies and
programs that govern both annual compensation and stock ownership programs for
the executive officers of the Company. The Company's executive compensation
policy is based on principles designed to ensure that an appropriate
relationship exists between executive pay and corporate performance, while at
the same time motivating and retaining executive officers.
Executive Compensation Components. The key components of the Company's
compensation program are base salary, an annual incentive award, and equity
participation. These components are administered with the goal of providing
total compensation that is competitive in the marketplace, rewards successful
financial performance and aligns executive officers' interests with those of
stockholders. The Compensation Committee reviews each component of executive
compensation on an annual basis.
Base Salary. Base salaries for executive officers are set at levels believed
by the Compensation Committee to be sufficient to attract and retain qualified
executive officers. Base pay increases are provided to executive officers
based on an evaluation of each executive's performance, as well as the
performance of the Company as a whole. In establishing base salaries, the
Compensation Committee not only considers the financial performance of the
Company, but also the success of the executive officers in developing and
executing the Company's strategic plans, developing management employees and
exercising leadership. The Compensation Committee believes that executive
officer base salaries for 1999 were reasonable as compared to amounts paid by
companies of similar size.
Annual Incentive. The Compensation Committee believes that a significant
proportion of total cash compensation for executive officers should be subject
to attainment of specific Company earnings criteria. This approach creates a
direct incentive for executive officers to achieve desired performance goals
and places a significant percentage of each executive officer's compensation
at risk. Consequently, each year the Compensation Committee establishes
potential bonuses for executive officers based on the Company's achievement of
certain earnings criteria. For 1999 no annual bonuses were paid to executive
officers.
Stock Options. The Compensation Committee believes that equity participation
is a key component of its executive compensation program. Stock options are
granted to executive officers primarily based on the officer's actual and
potential contribution to the Company's growth and profitability and
competitive marketplace practices. Option grants are designed to retain
executive officers and motivate them to enhance stockholder value by aligning
the financial interests of executive officers with those of stockholders.
Stock options also provide an effective incentive for management to create
shareholder value over the long term since the full benefit of the
compensation package cannot be realized unless an appreciation in the price of
the Company's Common Stock occurs over a number of years.
Compensation of Chief Executive Officer. Consistent with the executive
compensation policy and components described above, the Compensation Committee
determined the salary, bonus and stock options received by J. Kenneth
Stringer, III, the Chief Executive Officer of the Company, for services
rendered in 1999. Mr. Stringer received a base salary of $276,000 for 1999. He
also earned a grant of 4,000 shares of the Company's Common Stock, and
received a cash payment of $36,000 to cover the income tax consequences of the
stock grant. Mr. Stringer received the stock grant based upon achieving
particular financial performance goals specified in advance by the
Compensation Committee.
COMPENSATION COMMITTEE
John C. Hart
Ronald L. Turner
10
<PAGE>
Compensation Committee Interlocks and Insider Participation
The members of the Compensation Committee during the fiscal year ended
December 31, 1999, were Messrs. Hart and Turner.
Stock Performance Graph
The following graph compares the monthly return for the Company, the
Standard & Poor's Mid-Cap 400 Index and the Chase H&Q Technology Index.
COMPARISON OF MONTHLY RETURN*
AMONG FLIR SYSTEMS, INC., THE S & P MIDCAP 400 INDEX
AND THE CHASE H&Q TECHNOLOGY INDEX
[PERFORMANCE GRAPH APPEARS HERE]
PERFORMANCE GRAPH DATA
<TABLE>
<CAPTION>
S&P Midcap 400
Dates FLIR Systems H&Q Technology Index Returns
----- ------------ -------------- --------------
<S> <C> <C> <C>
Dec-94 100.00 100.00 100.00
Mar-95 119.23 111.98 108.19
Jun-95 109.62 139.69 117.62
Sep-95 94.23 157.87 129.10
Dec-95 94.23 149.52 130.95
Mar-96 94.23 152.40 139.00
Jun-96 94.23 163.25 143.01
Sep-96 100.96 173.30 147.17
Dec-96 105.77 185.84 156.09
Mar-97 125.00 177.13 157.39
Jun-97 121.15 213.21 182.69
Sep-97 152.88 258.39 209.54
Dec-97 159.62 217.87 206.43
Mar-98 155.77 263.80 229.17
Jun-98 132.69 270.08 224.26
Sep-98 101.92 240.08 191.82
Dec-98 178.85 338.89 245.87
Mar-99 139.42 369.08 230.18
Jun-99 116.35 437.12 262.77
Sep-99 99.52 462.43 240.70
Dec-99 125.00 756.85 282.07
</TABLE>
--------
* The monthly return on investment (change in stock price plus reinvested
dividends) for each of the periods for the Company, the Standard & Poor's
Mid-Cap 400 Index and the Chase H&Q Technology Index is based on the stock
price on June 22, 1993, the date of the Company's initial public offering.
Section 16 Reports
Section 16(a) of the Securities Exchange Act of 1934, as amended (the "1934
Act") requires the Company's directors and officers, and persons who own more
than 10% of a registered class of the Company's equity securities, to file
initial reports of ownership and reports of changes in ownership with the SEC.
Such persons also are required to furnish the Company with copies of all
Section 16(a) reports they file.
Based solely on its review of the copies of such reports received by it with
respect to fiscal 1999, or written representations from certain reporting
persons, the Company believes that all filing requirements applicable to its
directors, officers and persons who own more than 10% of a registered class of
the Company's equity securities have been complied with for fiscal 1999,
except for Messrs. Almerfors, Fitzhenry, Martin, Stringer, Sundermeier, A.
Teich, and J. Teich, each of whom inadvertently filed a Form 4 late.
11
<PAGE>
STOCK OWNED BY MANAGEMENT AND PRINCIPAL SHAREHOLDERS
The following table sets forth certain information known to the Company with
respect to the beneficial ownership of the Company's Common Stock as of June
19, 2000 by: (i) each person known by the Company to beneficially own more
than 5% of the outstanding shares of Common Stock, (ii) each of the Company's
directors, (iii) each of the Company's named executive officers, and (iv) all
directors and executive officers as a group. Except as otherwise indicated,
the Company believes that each of the following shareholders has sole voting
and investment power with respect to the shares beneficially owned by such
shareholder.
<TABLE>
<CAPTION>
Shares of Percent
Common Stock Common
Beneficially Stock
Name and Address of Beneficial Owner Owned(1) Outstanding
------------------------------------ ------------ -----------
<S> <C> <C>
Thermo Electron Corporation(2)........................ 4,162,000 28.8%
81 Wyman Street
Waltham, MA 02454
Franklin Resources, Inc.(3)........................... 1,261,477 8.7%
777 Mariners Island Blvd.
San Mateo, CA 94404
Advent International Corporation(4)................... 996,524 6.9%
75 State Street
Boston, MA 02109
Robert P. Daltry...................................... 319,479 2.2%
John C. Hart.......................................... 36,000 *
Earl R. Lewis......................................... 2,000 *
W. Allen Reed......................................... 41,000 *
J. Kenneth Stringer III............................... 198,505 1.4%
Ronald L. Turner...................................... 39,000 *
Steven E. Wynne....................................... -- --
James A. Fitzhenry.................................... 37,254 *
William N. Martin..................................... 34,421 *
Jay S. Teich.......................................... 61,855 *
Directors and Executive Officers as a group (14
persons)(5).......................................... 844,915 5.7%
</TABLE>
--------
* Less than one percent (1%).
(1) Applicable percentage of ownership is based on 14,431,497 shares of FLIR
Common Stock outstanding as of June 19, 2000. Beneficial ownership is
determined in accordance with rules of the SEC, and includes voting power
and investment power with respect to shares. Shares issuable upon the
exercise of outstanding stock options that are currently exercisable or
become exercisable within 60 days from June 19, 2000 are considered
outstanding for the purpose of calculating the percentage of Common Stock
owned by such person, but not for the purpose of calculating the
percentage of Common Stock owned by any other person. The number of shares
that are issuable upon the exercise of options that are currently
exercisable or exercisable within 60 days of June 19, 2000 is as follows:
Mr. Daltry -- 179,000; Mr. Hart -- 36,000; Mr. Reed -- 39,000; Mr.
Stringer -- 120,517; Mr. Turner -- 39,000; Mr. Martin -- 19,333;
Mr. Fitzhenry -- 22,666; Mr. Teich -- 8,333; and all officers and
directors as a group -- 497,182.
(2) This information as to beneficial ownership is based on a Schedule 13D
filed by Thermo Electron Corporation with the Securities and Exchange
Commission on August 16, 1999. The Schedule 13D states that (i) Thermo
Electron Corporation is the beneficial owner of 4,162,000 shares of Common
Stock as to which it has sole voting and dispositive power, and (ii) the
4,162,000 shares of Common Stock as to which beneficial ownership is
reported are held by Spectra-Physics AB, which is a majority-owned
subsidiary of Thermo Instrument Systems, Inc., a majority-owned publicly
traded subsidiary of Thermo Electron Corporation.
12
<PAGE>
(3) This information as to beneficial ownership is based on a Schedule 13G/A
filed by Franklin Resources, Inc. with the Securities and Exchange
Commission on January 24, 2000. The Schedule 13G states that Franklin
Resources and its affiliates are the beneficial owners of 1,261,477 shares
of Common Stock as to which certain affiliates of Franklin Resources have
sole voting and dispositive power.
(4) This information as to beneficial ownership is based on a Schedule 13G/A
filed with the Securities and Exchange Commission on April 9, 1999 by
Global Private Equity II Limited Partnership, Advent Direct Investment
Program Limited Partnership, Advent Israel Limited Partnership, Advent
Israel (Bermuda) Limited Partnership, EnviroTech Investment Fund I Limited
Partnership (together the "Advent Partnerships"), Advent International
Corporation ("AIC") and Advent International Limited Partnership ("AILP").
The Schedule 13G/A states that AIC is the General Partner of AILP which in
turn is the General Partner of each of the Advent Partnerships and, as
such, that AIC has sole voting and sole dispositive power with respect to
the 996,524 shares of Common Stock as to which beneficial ownership is
reported.
(5) Does not include the 4,162,000 shares of Common Stock held by
Spectra/Thermo Electron, as to which all directors and executive officers
disclaim beneficial ownership.
13
<PAGE>
INDEPENDENT AUDITORS
PricewaterhouseCoopers LLP ("PricewaterhouseCoopers") served as the
Company's independent auditors for the year ended December 31, 1999. On May 2,
2000, the Company dismissed PricewaterhouseCoopers as its independent
auditors. This action was approved by the Board of Directors and the Audit
Committee of the Board of Directors. The audit reports of
PricewaterhouseCoopers on the consolidated financial statements of the Company
and its subsidiaries as of and for the years ended December 31, 1998 and 1999,
did not contain any adverse opinion or disclaimer of opinion, nor were they
qualified or modified as to uncertainty, audit scope or accounting principles,
except that the report on the financial statements for the year ended December
31, 1999 included an emphasis of a matter paragraph referring to the
restatement of the 1998 financial statements, as described in the notes
thereto.
In connection with the audits for the two years ended December 31, 1999 and
1998, and the subsequent interim period through May 2, 2000, there were no
disagreements with PricewaterhouseCoopers on any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure, which if not resolved to the satisfaction of
PricewaterhouseCoopers, would have caused it to make a reference to the
subject matter of the disagreement in connection with its report.
In connection with the audit of the Company's consolidated financial
statements for the year ended December 31, 1999, PricewaterhouseCoopers has
delivered to the Company its Report to the Audit Committee--Results of 1999
Audit (the "Report"). The Report states that, in the course of
PricewaterhouseCoopers' audit of the Company's consolidated financial
statements for the year ended December 31, 1999, PricewaterhouseCoopers noted
certain matters involving the internal control structure or its operations
that it considered to be material weaknesses. The Report identified material
weaknesses in internal controls in three areas: (i) lack of follow-up by
personnel independent from the inventory costing system, (ii) the use of
manual entries to general ledger account balances for sales, cost of sales,
accounts receivable, inventory and inter-company receivables and payables and
the lack of regular and timely follow-up of the related accounts, and
(iii) the lack of regular and timely reconciliation of inter-company
receivable and payable accounts and follow-up of the related accounts. The
Report also states that, as a result of the material weaknesses in internal
controls identified in the Report, PricewaterhouseCoopers has determined that
it will be unable to perform a review of the Company's March 31, 2000 interim
financial statements and that PricewaterhouseCoopers believes that the
material weaknesses raise questions about the Company's ability to prepare
interim consolidated financial information that is both timely and accurate.
The Company has authorized PricewaterhouseCoopers to respond fully to
questions from any successor auditors regarding this matter. The Company
believes that it has corrected certain of the deficiencies identified by
PricewaterhouseCoopers and is in the process of taking actions to correct the
remaining deficiencies. The Audit Committee intends to review and discuss the
Report and take appropriate action.
On July 13, 2000, the Company engaged Arthur Andersen LLP ("Arthur
Andersen") as its independent auditors for the fiscal year ending December 31,
2000. The engagement of Arthur Andersen was approved by the Company's Board of
Directors.
In connection with the Company's dismissal of PricewaterhouseCoopers, the
Company sought to engage Arthur Andersen as its independent auditors for the
year ending December 31, 2000. Arthur Andersen agreed to be retained by the
Company to conduct the Statement of Accounting Standards No. 71 ("SAS 71")
review of the Company's interim consolidated financial statements for the
quarter ended March 31, 2000 (the "First Quarter SAS 71 Review") and agreed
that upon completion of the First Quarter SAS 71 Review, it would consider
acceptance of engagement as the Company's independent auditors for the year
ending December 31, 2000. The rules of the Securities and Exchange Commission
(the "SEC") require a SAS 71 review of interim financial information included
in Quarterly Reports on Form 10-Q prior to the filing of such information with
the SEC for all quarters ending after March 15, 2000.
During the two most recent fiscal years and the interim period through May
2, 2000, the date Arthur Andersen was retained to conduct the First Quarter
SAS 71 Review, neither the Company nor any person on its
14
<PAGE>
behalf consulted Arthur Andersen regarding (i) the application of accounting
principles to a specified transaction, either completed or proposed, (ii) the
type of audit opinion that might be rendered on the Company's financial
statements, or (iii) any matter that was either the subject of a disagreement
(as defined in paragraph 304(a)(1)(iv) of the Regulation S-K) or a reportable
event (as described in paragraph 304(a)(1)(v) of Regulation S-K).
In the ordinary course of the First Quarter SAS 71 Review, the Company
discussed various accounting and financial reporting matters with Arthur
Andersen. The Company also provided Arthur Andersen with a copy of the Report
of PricewaterhouseCoopers and discussed the Report with Arthur Andersen. Among
other things, the Report states that, in the course of PricewaterhouseCoopers'
audit of the Company's consolidated financial statements for the year ended
December 31, 1999, PricewaterhouseCoopers noted certain matters involving the
internal control structure of its operations that it considered to be material
weaknesses. The Company authorized PricewaterhouseCoopers to respond fully to
questions from Arthur Andersen regarding the Report. Arthur Andersen discussed
the Report with PricewaterhouseCoopers and has advised the Company that it
considered the Report and these discussions in conducting the First Quarter
SAS 71 Review. The Company also informed PricewaterhouseCoopers of its
discussions with Arthur Andersen of these matters.
A representative of Arthur Andersen is expected to be present at the Annual
Meeting and will be given an opportunity to make a statement if he or she
desires to do so and will be available to respond to appropriate questions.
DATE FOR SUBMISSION OF SHAREHOLDER PROPOSALS
Any shareholder proposal intended for inclusion in the proxy statement and
form of proxy relating to the Company's 2001 Annual Meeting of Shareholders
must be received by the Company not later than March 19, 2001, pursuant to the
proxy soliciting regulations of the SEC. In addition, the Company's bylaws
require that notice of shareholder proposals and nominations for director be
delivered to the Secretary of the Company not less than 60 days nor more than
90 days prior to the date of an annual meeting, unless notice or public
disclosure of the date of the meeting occurs less than 60 days prior to the
date of such meeting, in which event, shareholders may deliver such notice not
later than the 10th day following the day on which notice of the date of the
meeting was mailed or public disclosure thereof was made. Nothing in this
paragraph shall be deemed to require the Company to include in its proxy
statement and form of proxy for such meeting any shareholder proposal which
does not meet the requirements of the SEC in effect at the time.
OTHER MATTERS
As of the date of this Proxy Statement, the Board of Directors does not know
of any other matters to be presented for action by the shareholders at the
2000 Annual Meeting. If, however, any other matters not now known are properly
brought before the meeting, the persons named in the accompanying proxy will
vote such proxy in accordance with the determination of a majority of the
Board of Directors.
COST OF SOLICITATION
The cost of soliciting proxies will be borne by the Company. In addition to
use of the mails, proxies may be solicited personally or by telephone by
directors, officers and employees of the Company, who will not be specially
compensated for such activities. Also, W.F. Doring & Co. may solicit proxies
at an approximate cost of $2,500 plus reasonable expenses. Such solicitations
may be made personally, or by mail, facsimile, telephone, telegraph or
messenger. The Company will also request persons, firms and companies holding
shares in their names or in the name of their nominees, which are beneficially
owned by others, to send proxy materials to and obtain proxies from such
beneficial owners. The Company will reimburse such persons for their
reasonable expenses incurred in that connection.
15
<PAGE>
ADDITIONAL INFORMATION
A copy of the Company's Annual Report to Shareholders for the fiscal year
ended December 31, 1999 accompanies this Proxy Statement. The Company is
required to file an Annual Report on Form 10-K for its fiscal year ended
December 31, 1999 with the Securities and Exchange Commission. Shareholders
may obtain, free of charge, a copy of the Form 10-K (without exhibits) by
writing to Investor Relations, FLIR Systems, Inc., 16505 S.W. 72nd Avenue,
Portland, Oregon 97224.
By Order of the Board of Directors
/s/ John C. Hart
John C. Hart
President, Chief Executive Officer
and Director
Portland, Oregon
July 19, 2000
16
<PAGE>
FLIR SYSTEMS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned shareholder of FLIR Systems, Inc., an Oregon corporation
(the "Company"), hereby appoints John C. Hart and James A. Fitzhenry, or either
of them, with full power of substitution in each, as proxies to cast all votes
that the undersigned shareholder is entitled to cast at the Annual Meeting of
Shareholders (the "Annual Meeting") to be held at 2:00 p.m. on Tuesday, August
15, 2000 at the Multnomah Athletic Club, 1849 SW Salmon Street, Portland, Oregon
97205 and any adjournment or postponements thereof upon the following matters.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. UNLESS DIRECTION IS GIVEN, THIS PROXY
WILL BE VOTED "FOR" THE ELECTION OF THE NOMINEES LISTED IN PROPOSAL 1 AND IN
ACCORDANCE WITH THE RECOMMENDATIONS OF A MAJORITY OF THE BOARD OF DIRECTORS AS
TO OTHER MATTERS. The undersigned hereby acknowledges receipt of the Company's
Proxy Statement and hereby revokes any proxy of proxies previously given.
PLEASE SIGN, DATE AND RETURN THIS PROXY CARD TODAY, USING THE ENCLOSED
ENVELOPE.
(continued and to be signed and dated on reverse side)
________________________________________________________________________________
. FOLD AND DETACH HERE .
<PAGE>
Please mark
your votes [X]
as indicated
FOR the WITHHOLD
nominees listed AUTHORITY to vote
below (except as for all nominees
indicated below) listed below
1. Election of three directors [_] [_]
each for a three-year term.
Earl R. Lewis,
Ronald L. Turner and
Steven E. Wynne
INSTRUCTION: To withhold authority to vote for any nominee write the
nominee's name(s) in this space:
_____________________________________________________________________________
2. In their discretion, the proxies are authorized to vote upon such other
matters as may properly come before the meeting or any adjournments or
postponements thereof.
__________________________________________
Typed or Printed name(s)
__________________________________________
Authorized Signature
__________________________________________
Title or authority, if applicable
__________________________________________
Date
Please sign exactly as your name appears
on this Proxy Card. If shares are
registered in more than one name, all such
persons should sign. A corpoation should
sign in its full corporate name by a duly
authorized officer, stating his/her title.
Trustees, guardians, executors and
administrators should sign in their
official capacity, giving their full title
as such. If a partnership, please sign in
the partnership name by authorized
person(s).
If you receive more than one Proxy Card, please sign and return all such cards
in the accompanying envelope.
________________________________________________________________________________
. FOLD AND DETACH HERE .
