<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 [X]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
[X] Definitive Proxy Statement Rule 14a-6(e)(2))
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
Donnelly Corporation
------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No Filing 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 DONNELLY]
- -------------------------------------------------------------------------------
PRINCIPAL CORPORATE OFFICES: PLACE OF MEETING:
49 West Third Street Donnelly Corporation
Holland, Michigan 49423-2813 49 West Third Street
Holland, Michigan 49423-2813
April 3, 2000
- -------------------------------------------------------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To be held on May 16, 2000
To Our Shareholders:
The Annual Meeting of Shareholders of Donnelly Corporation, will be on
Tuesday, May 16, 2000, at 9:15 a.m. (local time), at the Company's offices at
49 West Third Street, Holland, Michigan, to elect ten (10) directors as set
forth in the Proxy Statement and to transact such other business as may
properly come before the meeting or at any adjournment thereof.
The Board of Directors has fixed the close of business on March 20, 2000 as
the record date for the Annual Meeting. Only shareholders of record at that
time will be entitled to notice of, and to vote at, the Annual Meeting or any
adjournment or postponement thereof.
It is important that your shares be represented at the Annual Meeting, even
if you cannot attend the Annual Meeting and vote your shares in person.
Shareholders of record can vote their shares by marking your votes on the
enclosed proxy card, signing, dating and mailing the proxy card in the
enclosed envelope, which requires no postage if mailed in the United States.
The return of the enclosed proxy will not affect your right to vote if you
attend the Annual Meeting in person, as your proxy is revocable at your
option.
By Order of the Board of Directors,
/s/ Maryam Komejan
Maryam Komejan
Secretary
<PAGE>
Dated: April 3, 2000
DONNELLY CORPORATION
49 West Third Street
Holland, Michigan 49423
----------------
Proxy Statement
For
Annual Meeting of Shareholders
To be held on May 16, 2000
----------------
GENERAL INFORMATION
This Proxy Statement is furnished to the shareholders of Donnelly
Corporation in connection with the solicitation by the Board of Directors of
proxies to be used at the Annual Meeting of Shareholders (the "Annual
Meeting") which will be held at the Company's offices at 49 West Third Street,
Holland, Michigan on May 16, 2000, at 9:15 a.m., local time. It is anticipated
that this Proxy Statement and proxy will first be mailed to the Company's
shareholders on or about April 3, 2000.
The Company's Annual Report on Form 10-K (including certified financial
statements) ("Annual Report") for the six-month period ending December 31,
1999 is accompanying this Proxy Statement. The Annual Report is not part of
the proxy solicitation material.
Change in Fiscal Year
In April 1999, effective July 4, 1999, the Company changed the date for the
end of its fiscal year from the Saturday nearest June 30 to December 31.
Voting of Proxies
Your vote is important. Shares can be voted at the Annual Meeting only if
you are present in person or represented by proxy. Even if you plan to attend
the meeting, you are urged to sign, date and return the accompanying proxy
card.
When the enclosed proxy card is properly signed, dated and returned, the
shares represented by the proxy will be voted in accordance with your
directions. You can specify your voting instructions by marking the
appropriate box on the proxy card. If your proxy card is signed and returned
without specific voting instructions, your shares of Donnelly Corporation
common stock will be voted FOR the nominees named by the Board of Directors as
set forth in this Proxy Statement. Abstentions marked on the proxy card have
the effect of being voted "against" the directors' proposal but are counted in
the determination of a quorum. Shares not voted at the meeting, whether by
broker non-vote or otherwise, will not be treated as votes cast at the
meeting. Votes cast at the meeting and submitted by proxy will be tabulated by
the Company's transfer agent, The Bank of New York.
You may revoke your proxy at any time before it is voted at the meeting by
delivering a written notice of revocation to the secretary of the Company,
executing and delivering a proxy of later date, or attending the meeting and
voting in person. Attendance at the meeting does not automatically act to
revoke a proxy.
<PAGE>
Votes Required
The close of business on March 20, 2000 has been fixed as the record date
for determination of holders of Company common stock entitled to notice of and
to vote at the Annual Meeting. On that date, there were outstanding 6,016,523
shares of Class A Common Stock of the Company, each having one vote per share
and 4,136,889 shares of Class B Common Stock each having ten (10) votes per
share. The shares of Class B Common Stock are limited in their transferability
but are convertible on a share for share basis into Class A Common Stock.
Holders of shares of Class A Common Stock, as a class, are entitled to elect
one-quarter (rounded up) of the directors to be elected at each meeting held
for the election of directors. Holders of Class B Common Stock elect, as a
class, the directors not elected by the shares of Class A Common Stock.
Holders of shares of Class B Common Stock have cumulative voting rights in the
election of directors. See "Nominees for Election as Directors."
The presence, either in person or by proxy, of persons entitled to cast a
majority of such votes constitutes a quorum for the transaction of business at
the Annual Meeting. Abstentions and broker no-votes on returned proxies are
counted as shares present in the determination of whether the shares of stock
represented at the Annual Meeting constitute a quorum. A broker "non-vote"
occurs when a nominee holding shares of the Company's Class A Common Stock for
a beneficial owner does not vote on a particular item and has not received
instructions from the beneficial owner.
Solicitation of Proxies
The Company will bear the cost of the solicitation. In addition to
solicitation by mail, the Company will request banks, brokers and other
custodian nominees and fiduciaries to supply proxy material to the beneficial
owners of Company common stock of whom they have knowledge, and will reimburse
them for their expenses in so doing; and some regular employees of the
Company, not specially employed for the purpose, may solicit proxies, without
additional remuneration therefor, by personal interview, mail, telephone or
telegraph.
Relationship With Independent Public Accountants
Since 1944, BDO Seidman LLP has served as the Company's independent public
accounting firm. It is expected that representatives of BDO Seidman will be
present at the annual meeting. They will be given an opportunity to make a
statement if they desire to do so, and it is expected that they will be
available to respond to appropriate questions. It is anticipated that the
Company's Audit Committee will select the Company's auditors before the end of
this calendar year.
Shareholder Proposals for 2001 Annual Meeting
Shareholder proposals intended to be presented at the Company's 2001 Annual
Meeting of Shareholders must be received by the Company's Corporate Secretary
no later than December 4, 2000. Such proposals must meet the requirements set
forth in the rules and regulations of the Securities and Exchange Commission
in order to be eligible for inclusion in the proxy statement for the Company's
2001 Annual Meeting of Shareholders.
Other Matters to Come Before the Meeting
The Board of Directors does not know of any matters which will be brought
before the 2000 Annual Meeting of Shareholders other than those specifically
set forth in the notice of meeting. If any other matters are properly
introduced at the meeting for consideration, including, among other things,
consideration of a motion to adjourn the meeting to another time or place, the
individuals named on the enclosed proxy card will have discretion to vote in
accordance with their best judgment.
2
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth as of March 20, 2000 (the "Record Date")
information concerning persons known to management who may be deemed to be
beneficial owners of more than 5% of either class of the Company's common
stock. Unless otherwise specified, the address for each of them is 49 West
Third Street, Holland, Michigan, 49423.
<TABLE>
<CAPTION>
Amount and Nature
of Percent of
Name and Address of Beneficial Percent of Each Common
Beneficial Owner Ownership Class of Stock Equity
- ----------------------------------------------------------------------------------
Class A Class B Class A Class B
--------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Bank One Corporation.... 394,997(1) 592,385(1) 6.6% 14.3% 9.7%
200 Ottawa Avenue
Grand Rapids, Michigan
49503
Dimensional Fund
Advisors Inc........... 405,325(2) -- 6.7 -- 4.0
1299 Ocean Avenue, 11th
Floor
Santa Monica, California
90401
Heartland Advisors,
Inc.................... 1,455,500(3) -- 24.2 -- 14.3
790 North Milwaukee
Street
Milwaukee, Wisconsin
53202
Investment Counselors of
Maryland, Inc.......... 427,000(4) -- 7.1 -- 4.2
803 Cathedral Street
Baltimore, Maryland
21201
Putnam Investments,
Inc.................... 401,812(5) -- 6.7 -- 4.0
One Post Office Square
Boston, Massachusetts
02109
Anne H. Copps........... -- 240,962(6) -- 5.8 2.4
Bernard P. Donnelly,
Jr..................... 10,542(7) 404,046(7) * 9.8 4.1
Virginia N. Donnelly.... 10,542(7) 404,046(7) * 9.8 4.1
Katherine S. Donnelly... 224,911(8) 314,878(8) 3.7 7.6 5.3
Charles A. Krahmer...... 108,019(9) 363,353(9) 1.8 8.8 4.6
Jane H. Krahmer......... 108,019(9) 363,353(9) 1.8 8.8 4.6
Gerald T. McNeive, Jr... 58,584(10) 311,890(10) * (12) 7.5 3.6(12)
Louise H. McNeive....... 58,584(10) 311,890(10) * (12) 7.5 3.6(12)
Marie Josephte
Martineau.............. 17,176 269,762 * 6.5 2.8
Fernande M. Pruden...... 224,709(11) 299,335(11) 3.4(12) 7.2 5.2(12)
Rudolph B. Pruden....... 224,709(11) 299,335(11) 3.4(12) 7.2 5.2(12)
- ----------------------------------------------------------------------------------
</TABLE>
* Denotes ownership of less than one percent
3
<PAGE>
For purposes of the following notes, shares of Class A Common Stock are
referred to as "A Shares" and shares of Class B Common Stock are referred to
as "B Shares."
(1) Includes (i) 42,233 B Shares held by Bank One Corporation (the "Bank") as
co-trustee of the Robert M. Leonard Trust, 43,750 B Shares as co-trustee
of the B.P. Donnelly Descendants Trust, 117,577 B Shares as co-trustee of
the John Donnelly Residual Trust and 388,825 B Shares held in two trusts
for which the Bank serves as sole trustee, (ii) 394,997 A Shares held by
Strafe & Co. acting as a nominee of the Bank as follows: 20,000 shares in
the Robert M. Leonard Trust, 15,908 shares in the B.P. Donnelly
Descendants Trust and 83,983 shares in the John Donnelly Residual Trust,
for all of which trusts the Bank serves as co-trustee and 275,106 shares
held in two trusts for which the Bank serves as sole trustee.
(2) In a Schedule 13G, dated February 4, 2000, and delivered to the Company,
Dimensional Fund Advisors Inc. ("Dimensional"), a registered investment
advisor, is deemed to have beneficial ownership of 405,325 A Shares, all
of which shares are held in portfolios of DFA Investment Dimensions Group
Inc., a registered open-end investment company, or in series of the DFA
Investment Trust Company, a Delaware business trust, or the DFA Group
Trust and DFA Participation Group Trust, investment vehicles for
qualified employee benefit plans, all of which Dimensional serves as
investment manager. Dimensional disclaims beneficial ownership of all
such shares.
(3) In a Schedule 13G, dated December 31, 1999, and delivered to the Company,
Heartland Advisors, Inc. ("Heartland") disclosed on behalf of its
investment advisory clients that they had acquired beneficial ownership
of 1,455,500 A Shares. Heartland has the sole power to dispose of all of
such shares, and sole power to vote 963,200 of such shares.
(4) In a Schedule 13G, filed February 9, 2000, and delivered to the Company,
Investment Counselors of Maryland, Inc. ("Investment Counselors")
disclosed on behalf of its investment advisory clients that they had
acquired beneficial ownership of 427,000 A Shares. Investment Counselors
has the sole power to dispose of all such shares and sole power to vote
387,000 of such shares.
(5) In a Schedule 13G dated January 26, 1994, and delivered to the Company,
Putnam Investments, Inc. ("Putnam") disclosed on behalf of its investment
management subsidiaries that it had acquired beneficial ownership of
401,812 A Shares. Putnam has the sole power to dispose of all of such
shares, and shared power to vote 132,062 of such shares.
(6) Includes 240,962 B Shares owned by a trust of which Anne H. Copps is
trustee.
(7) Includes 10,542 A Shares and 404,046 B Shares owned by two trusts of
which Bernard P. Donnelly, Jr. and Virginia N. Donnelly (husband and
wife) are co-trustees.
(8) Includes 83,983 A Shares and 117,577 B Shares held in the John Donnelly
Residual Trust for which Katherine S. Donnelly is a co-trustee.
(9) Includes 108,019 A Shares and 363,353 B Shares owned by two trusts of
which Charles A. Krahmer and Jane H. Krahmer (husband and wife) are co-
trustees.
(10) Includes (i) 43,368 A Shares and 295,486 B Shares owned by two trusts of
which Gerald T. McNeive, Jr. and Louise H. McNeive (husband and wife) are
co-trustees, (ii) stock options exercisable within 60 days for 3,500 A
Shares owned by Gerald T. McNeive, Jr., a director of the Company and (iii)
11,716 A Shares and 16,404 B Shares as to which Louise H. McNeive is
custodian for her children, and as to which Gerald T. McNeive, Jr.
disclaims beneficial ownership.
(11) Includes (i) 205,192 A Shares and 282,547 B Shares owned by Fernande M.
Pruden and her retirement plans and (ii) stock options exercisable within
60 days for 3,500 A Shares and 16,017 A Shares and 16,788 B Shares owned by
Rudolph B. Pruden and his retirement plans. Rudolph B. Pruden is Fernande
M. Pruden's husband and a director of the Company. Fernande M. Pruden and
Rudolph B. Pruden each disclaim beneficial ownership of the other's shares.
(12) Calculated based on the number of shares outstanding plus 548,713 shares
with respect to which officers and directors have the right to acquire
beneficial ownership under stock options exercisable within 60 days.
4
<PAGE>
Five of the Company's directors, B. Patrick Donnelly, III, Joan E. Donnelly,
Leonard, McNeive and Pruden are all descendants of, or are married to
descendants of, Bernard P. Donnelly, Sr., the Company's founder, and each
represents one of five family groups of such descendants (the "Donnelly
Family"). John F. Donnelly, Jr., the Chief Operating Officer of the Company's
European Operations, is also a descendant of Bernard P. Donnelly and is the
brother of Ms. Donnelly. Each of four family groups has the ability to elect
at least one director if they act together and cumulate the votes of the Class
B Common Stock. The Company does not know of a family group taking such
action. Members of the Donnelly Family own approximately 99% of the Class B
Common Stock and approximately 26% of the Class A Common Stock of the Company.
These shareholders therefore possess approximately 90% of the voting power of
the Company and approximately 26% of the voting power of the Class A Common
Stock. Members of the Donnelly Family may transfer shares of Class B Common
Stock among themselves, enabling them to retain voting control of the Company
for an extended period. Given the voting control of the Donnelly Family, the
Donnelly Family could, if all or part of the family took a united position in
response to attempts to acquire control of the Company through tender offers
or proxy contests, effectively block any such attempts. There is no assurance
that any united action would be taken.
NOMINEES FOR ELECTION AS DIRECTORS
The Company's Board of Directors is currently composed of ten members. All
nominees are currently directors of the Company and are up for re-election at
the Annual Meeting, each to serve until the 2001 annual meeting of
shareholders or until his or her successor is elected or his or her earlier
resignation or removal.
Three of the directors will be elected exclusively by the holders of the
Class A Common Stock voting as a class, and the other seven directors will be
elected by the holders of the Class B Common Stock voting as a class. Holders
of shares of Class B Common Stock have cumulative voting rights in the
election of directors. Cumulative voting rights of the Class B Common Stock
entitle the holders thereof to spread their votes equally among all nominees
for which they are entitled to vote or to cumulate those votes for one or any
number of the nominees for which they are entitled to vote. If a holder of
Class B Common Stock does not indicate on the proxy card that he or she
desires to cumulate votes, the proxies will spread the votes equally among all
nominees. The Board of Directors has nominated the persons set forth below for
election to the Company's Board of Directors at the annual meeting.
Holders of Class A Common Stock should complete the accompanying white proxy
and holders of Class B Common Stock should complete the accompanying yellow
proxy (and carefully review the instructions accompanying the yellow proxy
regarding cumulative voting). Unless otherwise directed by a shareholder's
proxy, it is intended that the votes cast upon exercise of proxies in the form
accompanying this statement will be in favor of electing as directors for the
ensuing year the nominees set forth below, all of whom are presently serving
as directors.
A plurality of the votes cast at the meeting is required to elect the
nominees as directors of the Company. As such, the three individuals who
receive the greatest number of votes cast by the holders of the Class A Common
Stock, voting as a class, will be elected as directors and the seven
individuals who receive the greatest number of votes cast by the holders of
Class B Common Stock, voting as a class, will be elected as directors. If any
nominee becomes unavailable for election due to circumstances not now known,
the accompanying proxy will be voted for such other person to become a
director as the Board of Directors so elects. The Board of Directors
recommends a vote FOR the election of all persons nominated by the Board.
The content of the following table is based upon information as of March 20,
2000 furnished to the Company by the nominees.
5
<PAGE>
<TABLE>
<CAPTION>
Amount and Nature
Year First of Percent of
Became A Beneficial Percent of Each Common
Name Age Director Ownership Class of Stock Equity (2)
- -----------------------------------------------------------------------------------------------
Class A (1) Class B Class A (2) Class B
----------- ------- ---------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Nominees for Election By
Holders of Class A
Common Stock
John A. Borden
(a,b,e,f,g,h).......... 66 1996 1,625 -- * % -- % * %
R. Eugene Goodson, Ph.D
(a,f,g)................ 64 1993 4,125 -- * -- *
Donald R. Uhlmann, Ph.D
(f,g,h)................ 63 1978 15,562 -- * -- *
Nominees for Election by
Holders of Class B
Common Stock
J. Dwane Baumgardner,
Ph.D................... 59 1982 183,766 -- 2.7 -- 1.8
Arnold F. Brookstone
(a,b,d,e).............. 69 1976 27,250 -- * -- *
B. Patrick Donnelly, III
(b,c,d,e).............. 55 1980 44,610(3) 139,240(3) * 3.4 1.8
Joan E. Donnelly
(b,c,d,e).............. 52 1987 69,081(4) 93,625(4) 1.0 2.3 1.6
Thomas E. Leonard
(c,d,f,g,h)............ 70 1967 29,750(5) 123,823(5) * 3.0 1.5
Gerald T. McNeive, Jr.
(c,d,f,g).............. 58 1980 58,584(6) 311,890(6) * 7.5 3.6
Rudolph B. Pruden
(b,c,d,e).............. 70 1984 224,709(7) 299,335(7) 3.4 7.2 5.2
- -----------------------------------------------------------------------------------------------
</TABLE>
* Denotes ownership of less than one percent.
<TABLE>
<C> <S>
(a) Member Audit Committee
(b) Member Compensation Committee
(c) Member Stock Option Committee
(d) Member Finance Committee
(e) Member Human Resource Committee
(f) Member Strategic Planning Committee
(g) Member Technology Committee
(h) Member Vision Committee
</TABLE>
For purposes of the following notes, shares of Class A Common Stock are
referred to as "A Shares" and shares of Class B Common Stock are referred to
as "B Shares."
(1) Includes the following number of shares with respect to which the
Directors have the right to acquire beneficial ownership under stock
options exercisable in 60 days: Mr. Borden--1,000; Dr. Baumgardner--
131,438; all other Directors--3,500.
(2) Calculated based on the number of shares outstanding plus 548,713 shares
with respect to which officers and directors have the right to acquire
beneficial ownership under stock options exercisable within 60 days.
(3) Includes (i) 250 A Shares and 8,500 B Shares owned jointly with Mr.
Donnelly's wife, Jacqueline K. Donnelly, (ii) 1,406 A Shares and 2,343 B
Shares owned by Jacqueline K. Donnelly, (iii) 4,624 A Shares and 7,500 B
Shares held in trust for the benefit of his children, for which Mr.
Donnelly is a trustee, and (iv) 15,908 A Shares and 43,750 B Shares held
in trust for the benefit of Mr. Donnelly and his brothers and sisters, for
which Mr. Donnelly is a co-trustee.
(4) Includes (i) 1,178 A Shares and 1,651 B Shares owned by Joan E. Donnelly's
husband, David K. Taylor as to which Ms. Donnelly disclaims beneficial
ownership, and (ii) 1,952 A Shares and 2,732 B Shares held by Ms. Donnelly
as custodian for her children.
(5) Includes (i) 20,000 A Shares and 42,233 B Shares held by the Robert M.
Leonard Trust, for which Mr. Leonard is a co-trustee, and (ii) 11,590 B
Shares owned by Mr. Leonard's wife, Ann N. Leonard, as to which Mr.
Leonard disclaims beneficial ownership.
6
<PAGE>
(6) See Note 10 under the caption "Voting Securities and Principal Holders
Thereof."
(7) See Note 11 under the caption "Voting Securities and Principal Holders
Thereof."
Mr. Borden is an independent business consultant. From January 1996 until
December 1999, he was a consultant with FTD (Florist Transworld Delivery
Inc.), a worldwide communications and financial service organization; from
1988 until his retirement in December 1995, he was Executive Vice President
and Chief Executive Officer of that company.
Dr. Goodson has been an Adjunct Professor at the University of Michigan's
School of Business since September 1998. From October 1997 to September 1998,
he was a consultant with Oshkosh Truck Corporation, a manufacturer of
specialized trucks and transport equipment; from 1990 until his retirement in
October 1997, he was Chairman of the Board of Directors and Chief Executive
Officer of that company.
Dr. Uhlmann has been a Professor of Materials Science and Engineering and of
Optical Science at the University of Arizona since 1986. From 1986 until 1998,
he served as Chairman of the Materials Science and Engineering Department.
Dr. Baumgardner joined the Company in 1969 and has been Chief Executive
Officer since 1982, Chairman of the Board since 1986, and President since
1994. Dr. Baumgardner is a director of SL Industries, Inc. and Wescast
Industries, Inc.
Mr. Brookstone served as Executive Vice President and Chief Financial and
Planning Officer of Stone Container Corporation, an international pulp and
paper company, until his retirement in January 1996. Mr. Brookstone serves
several Boards of Directors including Abitibi-Consolidated Inc., MFRI, Inc.,
and a number of privately held companies. He is also the Chairman of the Board
of Trustees of the ABN AMRO Family of Mutual and Money Market Funds.
Mr. B. Patrick Donnelly, III, has been President of Productive Solutions,
LLC, a business consulting firm, since May 1998. From November 1995 to April
1998 he was Plant Manager of Ran Enterprises, an automotive parts supplier;
from October 1993 through June 1995 he was Production Manager of Technical
Auto Parts Inc., an automotive parts supplier. Mr. Donnelly is a director of
Ottawa Financial Corporation.
Ms. Donnelly has been Executive Director of Tohono Chul Park, a non-profit
desert urban park and museum, since May 1995. From 1984 to 1995, she was a
shareholder and Vice President of Tizzard, Knuttinen, Donnelly & Wright, P.C.,
certified public accountants.
Mr. Leonard has been President of Grebe Consulting, a business consulting
firm, since March 1998. From 1972 until his retirement in February 1998 he was
President of Henry C. Grebe & Co., Inc. and Grebe Yacht Sales, Inc., a ship
repair and storage business which was recently engaged in land development.
Mr. McNeive is Senior Vice President of Finance and General Counsel for
Laclede Gas Co., a natural gas distributor, since March 1998. From September
1995 through February 1998 he was Senior Vice President of Finance and Chief
Financial Officer; from 1994 through August 1995 he was Vice President-
Associate General Counsel of that company.
Mr. Pruden retired in January 1995 from the National Oceanic and Atmospheric
Administration (NOAA), an agency of the United States Department of Commerce.
His last position, which he had held since 1985, was as chief of the audits
and internal control branch in the office of the controller.
Certain of the directors are related to each other. See "Voting Securities
and Principal Holders Thereof."
The Board of Directors, which had seven meetings in 1999, has several
committees including standing Audit, Compensation and Stock Option Committees.
The responsibilities of the Audit Committee, which met seven times during the
last year, include making recommendations on the choice of independent public
accountants, reviewing financial statements and meeting with accountants,
internal auditors and management.
7
<PAGE>
The Compensation Committee's responsibilities include making recommendations
to the Board with respect to executive compensation and fringe benefits. The
Compensation Committee met three times during 1999. A separate Stock Option
Committee makes final determinations with respect to the award of stock
options. The Stock Option Committee met two times in 1999. The Company has no
nominating committee. Each director of the Company attended at least 75% of
the aggregate number of meetings of the Board and the total number of meetings
of all committees of the Board on which such director served during 1999.
COMPENSATION OF DIRECTORS
Retirement Plan for Outside Directors. On September 21, 1992 the Board of
Director of the Company adopted a retirement plan for directors of the Company
who are not employees of the Company (the "Retirement Plan for Outside
Directors"). This plan provides directors who are not employees of the Company
("Outside Directors") with a retirement benefit based on their years of
service as a director of the Company and the annual directors' retainer fees
at the time of their retirement from the Board of Directors. The retirement
benefits begin after an Outside Director retires from the Board or reaches age
70, whichever date is later. The annual benefits under the plan are equal to
the annual directors' fees at the time of their retirement from the Board and
are payable in quarterly installments. Alternatively, a director may request a
lump-sum distribution. Effective August 21, 1998, the Board of Directors
amended the Retirement Plan for Outside Directors to provide that retirement
benefits continue for a period equal to the length of service on the Board
through 1998 or 35 years, whichever period is shorter, to provide that
directors joining the Board of Directors after 1997 will not be eligible to
participate in the plan and to provide that current directors who are
participating in the plan will not receive credit for years of service after
1998.
The retirement plan for outside directors is not a qualified plan under the
Internal Revenue Code and is not funded. Payments under the plan will be made
from the general assets of the Company.
Director Compensation. The directors of the Company, other than salaried
employees of the Company, receive an annual retainer fee of $20,000, an annual
retainer fee of $1,000 for each committee of which they are a member, $1,000
per meeting of the Board of Directors and $800 per meeting of committees
thereof which they attend. Chairs of committees receive an additional $400 per
respective committee meeting they chair.
Director fees may be voluntarily deferred under an unfunded deferred
director fee plan. Directors who are not employees of the Company are also
granted stock options under the Company's Non-employee Director Stock Option
Plan. Pursuant to the Plan, options are granted on the second Wednesday of
each August for 2,000 shares of Class A Common Stock. The exercise price of
these nonqualified options equals the fair market value of the Company's Class
A Common Stock on the date of grant. During calendar year 1999, options
covering an aggregate of 18,000 shares were granted to the Company's non-
employee directors at an exercise price per share of $15.4375.
All directors are reimbursed for out-of-pocket expenses incurred in
attending meetings of the Board of Directors and of committees thereof.
Directors who are employees of the Company are not compensated for their
service on the Board.
COMPENSATION OF EXECUTIVE OFFICERS
Committee Report on Executive Compensation
The Compensation Committee of the Board of Directors (the "Committee"),
comprised in calendar 1999 of, B. Patrick Donnelly, III, chair of the
Committee, John A. Borden, Arnold F. Brookstone, Joan E. Donnelly, and Rudolph
B. Pruden, is responsible for the recommendation to the Board of Directors for
the Board's approval and establishment of the level and manner of compensation
of the Company's executive officers
8
<PAGE>
("Executive Officers"). The Committee recommends to the Board of Directors the
compensation policies and practices of the Company utilized in establishing
the compensation of all employees. This is reflective of the Company's long
time commitment to the participative management process and the resulting
emphasis on the collective efforts and achievements of all employees of the
Company.
Compensation Philosophy. The Company's and the Committee's approach to
compensation is to further the Company's policy and practice of empowering its
employees, working individually and as a team, to achieve personal and
collective goals. The Company's compensation policies are intended to be
competitive in the marketplace, reward the achievement of annual and long-term
goals, both personal and corporate, as well as to encourage excellent
performance.
Compensation Policies and Programs. For calendar year 1999, the Company's
compensation programs consisted of cash compensation (including salary and
bonus), stock options, defined contribution and defined benefit retirement
plans. Each year, the Company utilizes external wage surveys to determine the
total compensation levels of employees performing similar roles with
organizations of similar size and like function. These pay ranges are then
used to establish a base level of compensation and amounts that may be paid
under performance standards. The composite performance standards are comprised
of financial performance standards as well as non-financial goals. Financial
performance standards measure levels of return on assets, improvements in
earnings per share and pre-tax income. The performance of Dr. Baumgardner,
Messrs. Reed and Scaffede was measured against company-wide standards. For
fiscal 1999 the performance of Mr. Donnelly was measured primarily by the
Company's European operations business performance and Mr. Viola was measured
primarily by the Company's North American automotive operations business
performance; in the six-month fiscal period ended December 31, 1999, their
performances were measured against company-wide standards. The Committee
combines these standards of performance with the achievement of nonfinancial
goals to compile a composite performance rating for the past year. This
overall rating is then used to establish the salary for the next year as well
as annual incentive payments for the prior year's performance. Total
compensation of the Company's executive officers, including the chief
executive officer, for calendar 1999 were therefore based, in large part, on
the performance of the Company during fiscal 1999.
Dr. Baumgardner's total compensation, including base salary, annual
incentive award target, and stock options, is reviewed based on compensation
for like sized companies in similar industries. It is further measured based
on comparative performance of those comparison companies and the performance
of Donnelly Corporation. The annual incentive opportunity (for 100% goal
attainment) for Dr. Baumgardner is seventy percent of his base salary in a
fiscal year and this incentive is based solely on company performance. For the
first half of calendar year 1999 (the last six months of the 1999 fiscal year)
that target was not achieved, due to overall Company performance. For the six
months from July 4 to December 31, 1999 there was an improvement in Company
performance and targets were exceeded for that period.
The Company believes that stock options and stock ownership contribute to
the aligning of employees' interests with those of shareholders. The Company's
Stock Option Plans encourage stock ownership by employees by authorizing the
grant of stock options to certain employees of the Company. The total number
of stock options granted in each period is determined by the Stock Option
Committee of the Board of Directors, comprised of Joan E. Donnelly, chair of
the Committee, B. Patrick Donnelly III, Thomas E. Leonard, Gerald T. McNeive,
Jr., and Rudolph B. Pruden. In determining the size of individual option
grants, the Committee evaluates each employee's job responsibilities,
competitive market practices, as well as the anticipated potential that
individual has in contributing to the success of the Company. The Company also
encourages stock ownership through participation in the Company's Employees'
Stock Purchase Plan. This plan is available to most U.S.-based employees of
the Company and permits employees to purchase shares of the Company's common
stock at a 15% discount from the market price of such shares.
9
<PAGE>
The Compensation Committee continues to review the limitations on the
deductibility for certain compensation paid to executive officers whose annual
compensation exceeds $1,000,000, as imposed by (S) 162(m) of the Internal
Revenue Code. To date, no officer has exceeded that level.
Compensation Committee
of the Board of Directors of
Donnelly Corporation
B. Patrick Donnelly, III, Chair
John A. Borden Arnold F. Brookstone
Joan E. Donnelly Rudolph B. Pruden
Executive Compensation
The following table sets forth the annual and long-term compensation paid by
the Company to its Chief Executive Officer and each of the Company's four most
highly compensated executive officers (collectively referred to as the "Named
Executives") for services rendered to the Company.
Summary Compensation Table
<TABLE>
<CAPTION>
Long-Term
Compensation
Annual Compensation Awards
----------------------------------- ------------
Stock
Name and Principal Fiscal Other Annual Options All Other
Position Year(1) Salary(2) Bonus(3) Compensation (4) (#) Compensation(5)
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
J. Dwane Baumgardner,
Ph.D.,................. 1999A $440,003 $219,500 -- 21,000 $8,540
Chairman of the Board, 1999B 442,311 0 -- 19,000 6,636
Chief Executive Officer
and 1998 400,005 0 -- 31,500 4,385
President
John F. Donnelly, Jr.,.. 1999A 275,018 181,538 $177,021(6) 12,000 4,299
Chief Operating
Officer, 1999B 271,842 127,875 -- 10,000 3,074
European Operations 1998 220,002 55,000 -- 11,000 1,030
Donn J. Viola,.......... 1999A 340,018 255,050 -- 15,000 4,425
Chief Operating
Officer, 1999B 331,940 219,300 -- 13,000 4,213
North America
Operations 1998 330,013 292,000 -- 22,000 2,435
Scott E. Reed, (7)...... 1999A 275,018 168,469 -- 15,000 3,013
Senior Vice President
and 1999B 231,649 140,938 125,000(8) 15,000 2,677
Chief Financial Officer 1998 -- -- -- -- --
Russell B. Scaffede,.... 1999A 255,008 156,144 -- 10,000 3,689
Senior Vice President 1999B 255,294 130,688 -- 4,500 2,850
1998 187,790 115,000 -- 7,500 842
- --------------------------------------------------------------------------------------------------
</TABLE>
(1) Effective July 4, 1999, the Company's fiscal year end changed from the
Saturday nearest June 30 to December 31. The summary compensation
information presented is for the twelve months ended December 31, 1999
("1999A"), the fiscal year ended July 3, 1999 ("1999B") and the fiscal
year ended June 27, 1998 ("1998"). Compensation paid to the Named Officers
during the transition period between July 4 and December 31, 1999 is
reflected in the 1999A period.
(2) Includes cash compensation plus compensation deferred during the
respective years under the Company's 401(k) Savings Plan and Deferred
Compensation Plan.
10
<PAGE>
(3) Represents amounts paid under the Donnelly Scanlon Bonus and earned under
the Executive Compensation Plan for performance during that year. The bonus
for the 1999A period includes a pro-rated six-month portion for the first
half of calendar year 1999, plus the transition period between July 4 and
December 31, 1999.
(4) Donnelly has concluded that the aggregate amount of perquisites and other
personal benefits paid in such period did not exceed the lesser of 10% of
such officer's total annual salary and bonus for each of 1999A, 1999B and
1998, respectively, or $50,000. Such perquisites have not been included in
the table.
(5) Payments included in these amounts for the twelve months ended December
31, 1999 consist of (a) amounts contributed by the Company to match a
portion of the employees' contributions under the Company's 401(k)
Savings Plan (J. Dwane Baumgardner--$1,904; John F. Donnelly, Jr.--
$1,852; Donn J. Viola $1,781; Scott E. Reed--$2,000; Russell B.
Scaffede--$1,778); plus (b) insurance premiums paid by the Company with
respect to term life insurance for the benefit of the named executive (J.
Dwane Baumgardner--$6,636; John F. Donnelly, Jr.--$2,447; Donn J. Viola--
$2,644; Scott E. Reed--$1,013; Russell B. Scaffede--$1,911).
(6) Represents tax reimbursement of $122,442 and tuition reimbursement of
$54,579 for expenses incurred in connection with Mr. Donnelly's
acceptance of an overseas assignment.
(7) Mr. Reed joined the Company on September 1, 1998.
(8) Represents amount paid as a signing bonus.
Option Grants in 1999. Shown below is information on grants of stock options
pursuant to the Company's 1998 Stock Option Plan (the "Option Plan") during
1999 to the Named Executives.
<TABLE>
<CAPTION>
Potential Realizable
Value at Assumed
% of Total Annual Rates of
Number Options Stock Price
Of Shares Granted to Appreciation for
Underlying Employees in Exercise Option Term (3)
Options Calendar Price Expiration ---------------------
Name Granted (1) Year (2) Date 5% 10%
- -------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
J. Dwane Baumgardner.... 21,000 15% $15.4375 8-11-09 $ 203,880 $ 516,671
John F. Donnelly, Jr.... 12,000 8% $15.4375 8-11-09 116,503 295,241
Donn J. Viola........... 15,000 10% $15.4375 8-11-09 145,628 369,051
Scott E. Reed........... 15,000 10% $15.4375 8-11-09 145,628 369,051
Russell B. Scaffede..... 10,000 7% $15.4375 8-11-09 97,086 246,034
- -------------------------------------------------------------------------------------------
</TABLE>
(1) These options become exercisable, so long as employment with the Company
continues, for one-third of the shares on each anniversary of the grant
date, beginning with the first anniversary of the grant date.
(2) The exercise price equals the closing market price of the Company's Class
A Common Stock on the date of grant. The exercise price may be paid in
cash and/or in shares of the Company's Class A Common Stock.
(3) These amounts are based on assumed rates of appreciation only. Actual
gains, if any, on stock option exercises will be dependent on overall
market conditions and on the future performance of the Company's Class A
Common Stock. There can be no assurance that the amounts reflected in this
table will be realized.
11
<PAGE>
Aggregated Stock Option Exercises in 1999 and Year-End Options Values. Shown
below is information with respect to unexercised options to purchase shares of
the Company's Class A Common Stock granted under the Company's stock option
plans to the Named Executives and held by them at December 31, 1999. Options
representing 12,500 shares of Class A Common Stock was exercised during 1999.
<TABLE>
<CAPTION>
Number of Shares Subject Value of Unexercised
To Unexercised Options In-the-Money Options at
Shares Held at December 31, 1999 December 31, 1999(1)
Acquired Value ------------------------- -------------------------
Name On Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
J. Dwane Baumgardner.... 12,500 $90,531 131,438 21,000 $85,690 $ 0
John F. Donnelly, Jr.... 64,751 12,000 50,625 0
Donn J. Viola........... 47,500 15,000 16,250 0
Scott E. Reed........... 15,000 15,000 0 0
Russell B. Scaffede..... 16,688 10,000 0 0
- -----------------------------------------------------------------------------------------------------
</TABLE>
(1) The value of unexercised options reflects the increase in market value of
the Company Class A Common Stock from the date of grant through December
31, 1999 (when the closing price of the Company's Class A Common Stock was
$14.00 per share.) Value actually realized upon exercise by the Named
Executives will depend on the value of the Company's Class A Common Stock
at the time of exercise.
Pension Plan Table. The following table shows the estimated annual benefits
payable upon normal retirement to persons in specified compensation and years
of service classifications under the Company's defined benefit plan and the
Company's Supplemental Retirement Plan (the "Supplemental Plan"). The
Supplemental Plan provides additional benefits only to those employees whose
projected retirement benefits under the Company's defined benefit plan are
restricted by the Internal Revenue Code (the "Code"). The Code limits
compensation that may be considered for qualified pension plan purposes and
also limits annual benefits that may be paid under qualified plans. The
Supplemental Plan is designed to provide participants with benefits, on a
nonqualified basis, so that their total retirement benefits under the
Company's pension plan and the Supplemental Plan will be equal to the benefits
they would have received under the Company's pension plan if the limitations
of the Code did not apply.
<TABLE>
<CAPTION>
Benefits Based Upon Years of
Service at
Normal Retirement Age (2)(3)
Final Average ----------------------------------
Annual 10
Compensation (1) Years 20 Years 30 Years 35 Years
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$120,000.................................. $15,000 $ 31,000 $ 46,000 $ 54,000
200,000.................................. 28,000 56,000 83,000 97,000
280,000.................................. 40,000 80,000 121,000 141,000
360,000.................................. 53,000 105,000 158,000 184,000
440,000.................................. 65,000 130,000 195,000 228,000
520,000.................................. 77,000 155,000 232,000 271,000
600,000.................................. 90,000 180,000 269,000 314,000
- -------------------------------------------------------------------------------
</TABLE>
(1) The final average annual compensation is determined under the defined
benefit plan and the Supplemental Plan by the average of the five highest
consecutive years of annual compensation (including salary and bonus
payments as referenced in the Summary Compensation Table) during the last
ten years of employment, subject to a maximum of $160,000 for 1999, for
computing benefits under the Company's defined benefit plan.
(2) The Named Executives have credited years of service under the defined
benefit plan and the Supplemental Plan as follows: J. Dwane Baumgardner--
30 years; John F. Donnelly, Jr.--22 years; Donn J. Viola--3 years; Scott
E. Reed--0 years; Russell B. Scaffede--4 years.
(3) Amounts in excess of $130,000, as limited by Section 415 of the Code,
would be paid pursuant to the Supplemental Plan. Benefits shown in the
table are computed as a straight life annuity beginning at age 66 and are
not subject to any deduction for social security benefits or other offset
amounts.
12
<PAGE>
The Company provides group health and life insurance benefits and
supplemental unemployment benefits to its regular employees, including
executive officers. The Company also maintains a 401(k) salary savings plan in
which all regular employees of the Company are eligible to participate and to
which the Company provides matching contributions of 25% on up to 5% of
eligible compensation.
Security Ownership of Management. The following table shows, as of March 20,
2000, the number of shares beneficially owned by each of the Named Executives
identified in the executive compensation tables of this proxy statement and by
all Directors and Executive Officers as a group. Except as described in notes
following the table, the following persons have sole voting and dispositive
power as to all of their respective shares.
<TABLE>
<CAPTION>
Percent of
Amount and Nature of Percent of Each Common
Name Beneficial Ownership Class of Stock Equity (2)
- -----------------------------------------------------------------------------------
Class A (1) Class B Class A (2) Class B
----------- --------- ---------- --------
<S> <C> <C> <C> <C> <C>
J. Dwane Baumgardner.... 183,766 -- 2.7% -- % 1.8%
John F. Donnelly, Jr.... 105,887(3) 110,471(3) 1.6 2.7 2.1
Donn J. Viola........... 47,500 -- * -- *
Scott E. Reed........... 21,089 -- * -- *
Russell B. Scaffede..... 16,688 -- * -- *
All Executive Officers
and Directors as a
Group (17 persons)..... 939,677 1,078,384 14.0 26.1 19.9
- -----------------------------------------------------------------------------------
</TABLE>
* Denotes ownership of less than one percent.
(1) Includes the following number of shares with respect to which the Named
Executives have the right to acquire beneficial ownership under stock
options exercisable in 60 days: Dr. Baumgardner--131,438; Mr. Donnelly--
64,749; Mr. Viola--47,500; Mr. Reed--15,000; and Mr. Scaffede--16,688.
(2) Calculated based on the number of shares outstanding plus 548,713 shares
with respect to which officers and directors have the right to acquire
beneficial ownership under stock options exercisable within 60 days.
(3) Includes (i) 976 A Shares and 1,366 B Shares owned by his wife, Banba
Donnelly, as to which Mr. Donnelly disclaims beneficial ownership, and
(ii) 1,952 A Shares and 1,366 B Shares owned by Mr. Donnelly as custodian
for his children.
13
<PAGE>
SHAREHOLDER RETURN PERFORMANCE GRAPH
Set forth below is a line graph comparing the cumulative total shareholder
return on the Company's Common Stock with the cumulative total return of the
Russell 2000 Index and the Dow Jones Other Auto Parts Index. In July 1999, the
Company's fiscal year end changed from the Saturday nearest June 30 to December
31. Therefore, the graph below shows the cumulative total return as of the end
of each of the five years in the period ended June 30, 1999, and the six-month
transition period ended December 31, 1999. The graph assumes the investment of
$100 on June 30, 1994 in the Company's Common Stock, the Russell 2000 Index and
the Dow Jones Other Auto Parts Index with dividends reinvested (the Dow Jones
Automobile Parts Index used in previous proxy statements no longer exists).
COMPARISON OF FIVE YEAR TOTAL RETURNS
AMONG THE DONNELLY CORPORATION, THE RUSSELL 2000 INDEX,
AND THE DOW JONES OTHER AUTO PARTS INDEX
[PERFORMANCE GRAPH]
Source: Research Data Group, Inc.
14
<PAGE>
CERTAIN TRANSACTIONS
Pursuant to a 1972 agreement (the "1972 Agreement") between the Company and
five principal shareholders, the Company agreed to purchase, upon the death of
any of those shareholders, an amount of the Company's 7 1/2% preferred stock,
$10 par value per share, equal to the lesser of $200,000 or the total estate
tax and cost of administration of the shareholder's estate. The purchase price
for the 7 1/2% preferred stock is $10 per share, its par value. The 1972
Agreement remains in effect with one shareholder, Bernard P. Donnelly, Jr.,
who owns 40,000 shares of the 7 1/2% preferred stock and who also owns more
than 5% of the common equity of the Company. See "Voting Securities and
Principal Holders Thereof."
The holders of the Company's Class B Common Stock also own shares of
Donnelly Export Corporation, a shareholder Domestic International Sales
Corporation under the Internal Revenue Code which has been designed to reduce
the income tax liability of the Company. The shares of Donnelly Export
Corporation are owned entirely by the holders of the Class B Common Stock of
the Company. The holders of Class B Common Stock hold, for every 175 such
shares, 16 shares of common stock of Donnelly Export Corporation. Donnelly
Export Corporation does not provide the holders of Class B Common Stock any
financial advantage over holders of the Class A Common Stock. The shareholders
of Donnelly Export Corporation are not entitled to vote on issues voted upon
by the Company's shareholders.
The above Notice and Proxy Statement are sent by order of the Board of
Directors.
April 3, 2000.
J. Dwane Baumgardner
CHAIRMAN OF THE BOARD
15
<PAGE>
- --------------------------------------------------------------------------------
The Company's Annual Report on Form 10-K containing certified financial
statements for the transition period from July 4, 1999 to December 31, 1999 is
being mailed to the shareholders with these materials.
- --------------------------------------------------------------------------------
<PAGE>
DONNELLY CORPORATION
49 WEST THIRD STREET, HOLLAND, MICHIGAN 49423-2813
PROXY - CLASS A COMMON STOCK
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints J. Dwane Baumgardner and Maryam Komejan
as Proxies, each with the power to appoint their substitute, and hereby
authorizes them to represent and to vote, as designated below, all the shares of
Class A Common Stock of Donnelly Corporation held of record by the undersigned
on March 20, 2000, at the annual meeting of shareholders to be held May 16,
2000, and at any adjournment thereof.
This proxy, when properly executed, will be voted in the manner directed herein
by the undersigned shareholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR ALL NOMINEES LISTED IN PROPOSAL 1.
(Continued and to be signed and dated on the Reverse Side.)
DONNELLY CORORATION
P.O. BOX 11041
NEW YORK, N.Y. 10203-0041
<PAGE>
[ ]
<TABLE>
<CAPTION>
1. Directors to be elected by holders of Class A Common Stock
<S> <C> <C>
FOR all nominees listed below [X] WITHHOLD AUTHORITY to vote [X] EXCEPTIONS [X]
for all nominees listed below
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE MARK THE "EXCEPTIONS" BOX AND STRIKE A LINE THROUGH THE
NOMINEE'S NAME IN THE LIST BELOW.)
John A. Borden, R. Eugene Goodson, Donald R. Uhlmann
2. In their discretion, the Proxies are authorized to vote upon such other business as may properly come before the meeting.
Change of Address and or [X]
Comments, Mark Here
Please sign exactly as name appears below. When shares are
held by joint tenants, both should sign. When signing as
attorney, executor, administrator, trustee or guardian,
please give full title as such. If a corporation, please
sign in full corporate name by president or other
authorized officer. If a partnership, please sign in
partnership name by authorized person.
DATED: , 2000
---------------------------------------------
---------------------------------------------------------
Signature
---------------------------------------------------------
Signature if held jointly
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY VOTES MUST BE INDICATED
USING THE ENCLOSED ENVELOPE. (X) IN BLACK OR BLUE INK [X]
</TABLE>
<PAGE>
DONNELLY CORPORATION
49 West Third Street, Holland, Michigan 49423-2813
PROXY - CLASS B COMMON STOCK
This Proxy is solicited on behalf of the Board of Directors
The undersigned hereby appoints J. Dwane Baumgardner and Maryam Komejan as
Proxies, each with the power to appoint their substitute, and hereby authorized
them to represent nd to vote, as designated below, all the shares of Class B
Common Stock of Donnelly Corporation held of record by the undersigned on March
20, 2000, at the annual meeting of shareholders to be held May 16, 2000, and at
any adjournment thereof.
This proxy, when properly executed, will be voted in the manner directed herein
by the undersigned shareholder. If no direction is made, this Proxy will be
voted FOR all nominees listed in Proposal l.
(Continued and to be signed and dated on the Reverse Side.)
DONNELLY CORPORATION
P.O. BOX 11041
NEW YORK, N.Y. 10203-0041
<PAGE>
[ ]
<TABLE>
<CAPTION>
<S><C>
1. Directors to be elected by holders of Class B Common Stock
Holders of Class B Common Stock have 10 votes per share and have the right to cumulate their votes in the election of directors
to be elected by that class. (See enclosed instructions.) PLEASE VOTE EITHER IN SUBSECTION A OR SUBSECTION B, BUT NOT BOTH.
A. NON-CUMULATIVE VOTING.
If desired, a holder may vote for or against all nominees by checking one of the boxes below
FOR all nominees listed below [X] WITHHOLD AUTHORITY to vote [X] EXCEPTIONS [X]
for all nominees listed below
(INSTRUCTION: IF NOT CUMULATING YOUR VOTES, TO WITHHOLD AUTHORITY TO VOTE FOR A NOMINEE, STRIKE THAT NOMINEE'S NAME FROM THE LIST
BELOW.)
J Baumgardner, A. Brookstone, B.P. Donnelly, T. Leonard, G. McNeive Jr., R. Pruden
B. CUMULATIVE VOTING (DO NOT VOTE HERE IF YOU HAVE ALREADY VOTED IN SUBSECTION A).
To cumulate votes, write in the number of votes you wish to cast for a nominee opposite his or her name.
J. Baumgardner B.P. Donnelly T. Leonard R. Pruden
- ---- ----- ----- -----
A. Brookstone J. Donnelly G. McNeive, Jr.
- ---- ----- -----
2. In their discretion, the Proxies are authorized to vote upon such other
business as properly come before the meeting.
Change of Address and or
Comments, Mark Here
Please sign exactly as name appears below. When shares
are held by joint tenants, both should sign. When
signing as attorney, executor, administrator, trustee or
guardian, please give full title as such. If a
corporation, please sign in full corporate name by
president or other authorized officer. If a partnership,
please sign in partnership name by authorized person.
DATED: , 2000
-------------------------------------------
-------------------------------------------------------
Signature
-------------------------------------------------------
Signature if held jointly
VOTES MUST BE INDICATED
(X) IN BLACK OR BLUE INK. [X]
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY
USING THE ENCLOSED ENVELOPE.
</TABLE>
<PAGE>
Instructions for Voting of Class B Common Stock
Holders of the Class B Common Stock of Donnelly Corporation have 10 votes
per share and also have the right to cumulate their votes in the election of
directors to be elected by that class. At the 2000 Annual Meeting, the Class B
Common Stock will elect 7 directors. The right to cumulate votes means that
holders of Class B Common Stock, instead of spreading their votes equally
among all 7 nominees, may cast all of their votes for one nominee or otherwise
cast the votes on a disproportionate basis among the nominees.
A holder's total number of votes is equal to the number of shares of Class B
Common Stock held times 10 times 7. For example, if a holder owns 500 shares,
his or her total number of votes in the election of directors will be 35,000.
These votes may be distributed among the nominees however the holder desires.
For example, again assuming 35,000 votes (based upon ownership of 500 shares),
a holder may cast all 35,000 votes for one nominee, cast the votes in some
other combination disproportionately among the nominees or cast a blanket vote
for all nominees (in which case each nominee would get 5,000 votes).
The enclosed yellow proxy explains what a holder must do in order to
cumulate votes and also what a holder must do to simply vote for all the
nominees or to withhold authority for all the nominees. The proxy permits a
holder to either vote without cumulating votes or to cumulate votes.
