UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Soliciting Material Pursuant to
[_] Confidential, For Use of the SS.240.14a-11(c) or SS.240.14a-12
Commission Only (as permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
CONMED CORPORATION
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(Name of Registrant as Specified In Its Charter)
N/A
- --------------------------------------------------------------------------------
(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):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
________________________________________________________________________________
<PAGE>
CONMED CORPORATION
310 Broad Street
Utica, New York 13501
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of
CONMED Corporation (the "Company") will be held at the Radisson Hotel - Utica
Centre, 200 Genesee Street, Utica, New York on Tuesday, May 16, 2000, at 3:30
P.M. (New York time), for the following purposes:
(1) To elect six Directors to serve on the Company's Board of Directors;
(2) To appoint independent accountants for the Company for 2000; and
(3) To transact such other business as may properly be brought before
the meeting or any adjournment thereof.
The shareholders of record at the close of business on March 29, 2000
are entitled to notice of and to vote at the Annual Meeting or any adjournment
thereof.
Even if you plan to attend the meeting in person, we request that you
mark, date, sign and return your proxy in the enclosed self-addressed envelope
as soon as possible so that your shares may be certain of being represented and
voted at the meeting. Any proxy given by a shareholder may be revoked by that
shareholder at any time prior to the voting of the proxy.
By Order of the Board of Directors,
/s/ Thomas M. Acey
------------------
Thomas M. Acey
Secretary
April 14, 2000
<PAGE>
CONMED CORPORATION
310 Broad Street
Utica, New York 13501
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
May 16, 2000
The enclosed proxy is solicited by and on behalf of the Board of
Directors of CONMED Corporation (the "Company") for use at the Annual Meeting of
Shareholders to be held on Tuesday, May 16, 2000, at 3:30 P.M. (New York time),
at the Radisson Hotel - Utica Centre, 200 Genesee Street, Utica, New York, and
any adjournment thereof. The matters to be considered and acted upon at such
meeting are described in the foregoing notice of the meeting and this proxy
statement. This proxy statement, the related form of proxy and the Company's
annual report to shareholders are being mailed on or about April 14, 2000 to all
shareholders of record on March 29, 2000. Shares of the Company's Common Stock,
par value $.01 per share (the "Common Stock"), represented in person or by proxy
will be voted as hereinafter described or as otherwise specified by the
shareholder. Any proxy given by a shareholder may be revoked by the shareholder
at any time prior to the voting of the proxy by delivering a written notice to
the Secretary of the Company, by executing and delivering a later-dated proxy or
by attending the meeting and voting in person.
The persons named as proxies are Eugene R. Corasanti and Robert E.
Remmell, who are presently directors and, in the case of Mr. Corasanti, an
officer of the Company. The cost of preparing, assembling and mailing the proxy,
this proxy statement and other material enclosed, and all clerical and other
expenses of solicitations, will be borne by the Company. In addition to the
solicitation of proxies by use of the mails, directors, officers and employees
of the Company and its subsidiaries may solicit proxies by telephone, telegram
or personal interview. The Company also will request brokerage houses and other
custodians, nominees and fiduciaries to forward soliciting material to the
beneficial owners of Common Stock held of record by such parties and will
reimburse such parties for their expenses in forwarding soliciting material.
Votes at the 2000 Annual Meeting will be tabulated by a representative
of Registrar and Transfer Company, which has been appointed by the Company's
Board of Directors to serve as inspector of election.
VOTING RIGHTS
The holders of record of the 15,322,718 shares of Common Stock
outstanding on March 29, 2000 will be entitled to one vote for each share held
on all matters coming before the meeting. The holders of record of a majority of
the outstanding shares of Common Stock present in person or by proxy will
constitute a quorum for the transaction of business at the meeting. Shareholders
are not entitled to cumulative voting rights. Under the rules of the Securities
and Exchange Commission (the "SEC"), boxes and a designated blank space are
provided on the proxy card for shareholders if they wish either to abstain on
one or more of the proposals or to withhold authority to vote for one or more
nominees for director. In accordance with New York State law, such abstentions
are not counted in determining the votes cast at the meeting. With respect to
Proposal 1, the director nominees who receive the greatest number of votes at
the meeting will be elected to the Board of Directors of the Company. Votes
against, and votes withheld in respect of, a candidate have no legal effect.
<PAGE>
Proposal 2 requires the affirmative vote of the holders of a majority of the
votes cast at the meeting in order to be approved by the shareholders. When
properly executed, a proxy will be voted as specified by the shareholder. If no
choice is specified by the shareholder, a proxy will be voted "for" all portions
of items (1) and (2). Each proxy will be voted in the proxies' discretion on any
other matters coming before the meeting.
Under the rules of the New York Stock Exchange, Inc., which effectively
govern the voting by any brokerage firm holding shares registered in its name or
in the name of its nominee on behalf of a beneficial owner, Proposals (1) and
(2) are considered "discretionary" items upon which brokerage firms may vote in
their discretion on behalf of their clients if such clients have not furnished
voting instructions within ten days prior to the Annual Meeting (shares held by
such clients, "broker non-votes"). The broker non-votes will be treated in the
same manner as votes present.
ANNUAL REPORT
The annual report for the fiscal year ended December 31, 1999,
including financial statements, is being furnished herewith to shareholders of
record on March 29, 2000. The annual report does not constitute a part of the
proxy soliciting material and is not deemed "filed" with the SEC.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information with respect to the
beneficial ownership of the Company's Common Stock as of March 29, 2000, by each
shareholder known by the Company to be the beneficial owner of more than 5% of
its outstanding Common Stock, by each director and nominee director, by each of
the Named Executive Officers (as defined below) and by all directors and
executive officers as a group.
Amount and Nature of Percent of
Name of Beneficial Owner* Beneficial Ownership Class
William W. Abraham(1) 180,152 1.12
Eugene R. Corasanti(2) 635,402 3.97
Joseph J. Corasanti(3) 67,625 (4)
Bruce F. Daniels(5) 9,375 (4)
William D. Matthews(6) 13,000 (4)
Robert E. Remmell(7) 6,450 (4)
Stuart J. Schwartz(8) 3,850 (4)
John V. Scibelli(9) 4,000 (4)
Robert D. Shallish, Jr.(10) 66,525 (4)
Directors and executive officers as a group (9 986,379 6.16
persons)(1)(2)(3)(5)(6)(7)(8)(9)(10)(11)
Bristol-Myers Squibb Company(12) 1,000,000 6.13
345 Park Avenue
New York, NY 10154
2
<PAGE>
Amount and Nature of Percent of
Name of Beneficial Owner* Beneficial Ownership Class
Fenimore Asset Management, Inc.(13) 1,261,693 8.23
Thomas O. Putnam
118 North Grand Street
P.O. Box 310
Cobleskill, New York 12043
- -----------------------
* Unless otherwise set forth above, the address of each of the above
listed shareholders is c/o CONMED Corporation, 310 Broad Street, Utica,
New York 13501.
(1) Includes 162,052 shares subject to options, exercisable within 60 days.
(2) Includes 410,502 shares subject to options, exercisable within 60 days.
Also includes 42,525 shares owned beneficially by the wife of Eugene R.
Corasanti. Eugene R. Corasanti disclaims beneficial ownership of these
shares.
(3) Includes 40,700 shares subject to options, exercisable within 60 days.
Joseph J. Corasanti is the son of Eugene R. Corasanti.
(4) Less than 1%.
(5) Includes 6,000 shares subject to options, exercisable within 60 days.
Also includes 3,375 shares owned beneficially by the wife of Bruce F.
Daniels. Mr. Daniels disclaims beneficial ownership of these shares.
(6) Includes 3,000 shares subject to options, exercisable within 60 days.
(7) Includes 6,000 shares subject to options, exercisable within 60 days.
(8) Includes 3,000 shares subject to options, exercisable within 60 days.
Also includes 850 shares owned beneficially by the wife of Stuart J.
Schwartz. Dr. Schwartz disclaims beneficial ownership of these shares.
(9) Includes 4,000 shares subject to options, exercisable within 60 days.
(10) Includes 57,200 shares subject to options, exercisable within 60 days.
(11) Includes 692,454 shares subject to options, exercisable within 60 days,
held by William W. Abraham, Eugene R. Corasanti, Joseph J. Corasanti,
Bruce F. Daniels, William D. Matthews, Robert E. Remmell, Stuart J.
Schwartz, John V. Scibelli, and Robert D. Shallish, Jr., directors and
executive officers of the Company. Such 692,454 shares are equal to
approximately 4.52% of the Common Stock outstanding. As of March 29,
2000, the Company's directors and officers as a group (9 persons) are
the record owners of 247,175 shares, which is approximately 1.61% of
the Common Stock outstanding.
(12) A Schedule 13D filed with the SEC by Bristol-Myers Squibb Company
("BMS") on January 9, 1998, indicates that BMS beneficially owns
1,000,000 shares of Common Stock by virtue of having sole voting and
dispositive power over such shares pursuant to a warrant to purchase
Common Stock, dated as of December 31, 1997, issued by the Company to
BMS in connection with the acquisition of Linvatec Corporation
("Linvatec") by the Company on December 31, 1997.
(13) An Amendment to a Schedule 13G filed with the SEC by these entities on
February 8, 2000 indicates that such entities beneficially own
1,261,693 shares of Common Stock by virtue of having shared voting and
dispositive power over such shares through discretionary accounts owned
economically by clients.
On March 29, 2000 there were 1,228 shareholders of record of the Company's
Common Stock.
3
<PAGE>
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Pursuant to regulations promulgated by the Securities and Exchange
Commission, the Company is required to identify, based solely on a review of
reports filed under Section 16(a) of the Securities Exchange Act of 1934, and
furnished to the Company pursuant to Rule 16a-3(c) thereunder, each person who,
at any time during its fiscal year ended December 31, 1999, was a director,
officer or beneficial owner of more than ten percent of the Company's Common
Stock that failed to file on a timely basis any such reports. Based on such
reports, the Company is not aware of any such failure to file on a timely basis
any such reports by any such person that has not previously been disclosed.
4
<PAGE>
PROPOSAL ONE: ELECTION OF DIRECTORS
At the meeting, six directors are to be elected to serve on the
Company's Board of Directors. The shares represented by proxies will be voted as
specified by the shareholder. If the shareholder does not specify his choice,
the shares will be voted in favor of the election of the nominees listed on the
proxy card, except that in the event any nominee should not continue to be
available for election, such proxies will be voted for the election of such
other persons as the Board of Directors may recommend. The Company does not
presently contemplate that any of the nominees will become unavailable for
election for any reason. The director nominees who receive the greatest number
of votes at the meeting will be elected to the Board of Directors of the
Company. Votes against, and votes withheld in respect of, a candidate have no
legal effect. Shareholders are not entitled to cumulative voting rights.
The Board of Directors recommends a vote FOR this proposal.
The Board of Directors consists of six directors. Directors hold office
for terms expiring at the next annual meeting of shareholders and until their
successors are duly elected and qualified. Each of the nominees proposed for
election at the Annual Meeting is presently a member of the Board of Directors
and has been elected by the shareholders.
The following table sets forth certain information regarding the
members of, and nominees for, the Board of Directors:
NOMINEES FOR ELECTION AT THE 2000 ANNUAL MEETING
<TABLE>
<CAPTION>
Served As
Director Principal Occupation or
Name Age Since Position with the Company
---- --- ------ -------------------------
<S> <C> <C> <C>
Eugene R. Corasanti 69 1970 Chairman of the Board of Directors and Chief
Executive Officer of the Company
Robert E. Remmell 69 1983 Partner of Steates Remmell Steates & Dziekan
(Attorneys)
Bruce F. Daniels 65 1992 Executive, retired; former Controller of the
international division of Chicago Pneumatic Tool
Company
William D. Matthews 65 1997 Chairman of the Board of Directors and retired Chief
Executive Officer of Oneida Ltd. and director of
Oneida Financial Corporation and Coyne Textile
Services
Stuart J. Schwartz 63 1998 Physician, retired
Joseph J. Corasanti 36 1994 President, and Chief Operating Officer of the Company
</TABLE>
5
<PAGE>
DIRECTORS, EXECUTIVE OFFICERS AND SENIOR OFFICERS
EUGENE R. CORASANTI (age 69) has served as Chairman of the Board of the
Company since its incorporation in 1970. Mr. Corasanti is also the Company's
Chief Executive Officer. Prior to that time he was an independent public
accountant. Mr. Corasanti holds a B.B.A. degree in Accounting from Niagara
University. Eugene R. Corasanti's son, Joseph J. Corasanti, is President and
Chief Operating Officer and a Director of the Company.
ROBERT E. REMMELL (age 69) has served as a Director since June 1983 and
as an Assistant Secretary of the Company and as an officer of several of the
Company's subsidiaries since June 1983. On March 1, 2000, Mr. Remmell resigned
from his position as Assistant Secretary of the Company, and from the positions
he had held in the Company's subsidiaries. Mr. Remmell has been a partner since
January 1961 of Steates Remmell Steates & Dziekan, Utica, New York, which serves
as corporate counsel to the Company. The Company made no payments to Steates
Remmell Steates & Dziekan for services rendered during fiscal year 1999. Mr.
Remmell holds a B.A. degree from Utica College and an L.L.B. from Syracuse
University School of Law.
BRUCE F. DANIELS (age 65) has served as a Director of the Company since
August 1992. Mr. Daniels is a retired executive. From August 1974 to June 1997,
Mr. Daniels held various executive positions, including a position as Controller
with Chicago Pneumatic Tool Company. Mr. Daniels holds a B.S. degree in Business
from Utica College.
WILLIAM D. MATTHEWS (age 65) has served as a Director of the Company
since August 1997. Since 1986 he has been the Chairman of the Board, and from
1986 to his retirement in January 1999 he was the Chief Executive Officer of
Oneida Ltd. Mr. Matthews holds a B.A. degree from Union College and an L.L.B.
degree from Cornell University School of Law.
STUART J. SCHWARTZ (age 63) has served as a Director of the Company
since May 1998. Dr. Schwartz is a retired physician. From 1969 to December 1997
he was engaged in private practice as an urologist. Dr. Schwartz holds a B.A.
degree from Cornell University and a M.D. degree from SUNY Upstate Medical
College, Syracuse.
JOSEPH J. CORASANTI (age 36) has served as President and Chief
Operating Officer of the Company since August 1999 and as a Director of the
Company since May 1994. He also served as General Counsel and Vice
President-Legal Affairs of the Company from March 1993 to August 1998 and
Executive Vice-President/General Manager of the Company from August 1998 to
August 1999. Prior to that time he was an Associate Attorney with the law firm
of Morgan, Wenzel & McNicholas, Los Angeles, California from 1990 to March 1993.
Mr. Corasanti holds a B.A. degree in Political Science from Hobart College and a
J.D. degree from Whittier College School of Law. Joseph J. Corasanti is the son
of Eugene R. Corasanti, Chairman and Chief Executive Officer of the Company.
WILLLAM W. ABRAHAM (age 68) joined the Company in May 1977 as General
Manager. He has served as the Company's Vice President-Manufacturing and
Engineering since June 1983. In November of 1989 he was named Executive Vice
President and in March 1993, he was named Senior Vice President of the Company.
Mr. Abraham holds a B.S. degree in Industrial Management from Utica College.
ROBERT D. SHALLISH, JR. (age 51) joined the Company as Chief Financial
Officer and Vice President-Finance in December 1989 and has also served as an
Assistant Secretary since March 1995. Prior to this he was employed as
Controller of Genigraphics Corporation in Syracuse, New York since 1984. He was
6
<PAGE>
employed by Price Waterhouse LLP as a certified public accountant and senior
manager from 1972 through 1984. Mr. Shallish graduated with a B.A. degree in
Economics from Hamilton College and holds a Master's degree in Accounting from
Syracuse University.
JOHN V. SCIBELLI (age 52) joined the Company as President of Aspen
Laboratories, Inc., a wholly owned subsidiary of the Company, in August 1998. In
January 2000, Mr. Scibelli also became responsible for the overall sales of the
Company's electrosurgery products. Prior to his employment with the Company, Mr.
Scibelli was employed by Valleylab Inc. Division of Pfizer for twelve years
where he served in a number of senior management capacities, most recently as
President. Mr. Scibelli holds a B.S. degree from Long Island University and a
Ph.D. degree in Chemistry from the University of Michigan.
THOMAS M. ACEY (age 53) has been employed by the Company since August
1980 and has served as the Company's Treasurer since August 1988 and as the
Company's Secretary since January 1993. Mr. Acey holds a B.S. degree in Public
Accounting from Utica College and prior to joining the Company was employed by
the certified public accounting firm of Tartaglia & Benzo in Utica, New York.
LUKE A. POMILIO (age 35) joined the Company as Controller in September
1995. In addition, in September 1999, Mr. Pomilio became a Vice President with
responsibility for certain of the Company's manufacturing and research and
development activities. Prior to his employment with the Company, Mr. Pomilio
served for two years as Controller of Rome Cable Corporation, a wire and cable
manufacturer. He was also employed as a certified public accountant for seven
years with Price Waterhouse LLP where he served most recently as an audit
manager. Mr. Pomilio graduated with a B.S. degree in Accounting and Law from
Clarkson University.
DANIEL S. JONAS (age 36) joined the Company as General Counsel in
August 1998 and in addition became the Vice President-Legal Affairs in March
1999. In September 1999, Mr. Jonas assumed responsibility of certain of the
Company's regulatory affairs and quality assurance activities. Prior to his
employment with the Company he was a partner with the law firm of Harter,
Secrest & Emery, LLP in Syracuse from January 1998 to August 1998, having joined
the firm as an Associate Attorney in 1995. Prior to that he was an Associate
Attorney at Miller, Alfano & Raspanti, P.C. in Philadelphia from 1992 to 1995 as
well as an adjunct professor of law at the University of Pennsylvania Law School
from 1991 to 1995. Mr. Jonas holds an A.B. degree from Brown University and a
J.D. from the University of Pennsylvania Law School.
FRANK R. WILLIAMS (age 51) joined the Company in 1974 as Sales Manager
and Director of Marketing and became Vice President-Marketing and Sales in June
1983. In September 1989, he became Vice President-Business Development, in
November 1995, he became Vice President-Technology Assessment and in January
2000, he also became Vice President-Research and Development and Marketing for
Minimally Invasive Surgical Products. Mr. Williams graduated with a B.A. degree
from Hartwick College in 1970 as a biology major and did his graduate study in
Human Anatomy at the University of Rochester College of Medicine.
JOHN J. STOTTS (age 43) joined the Company as Vice President-Marketing
and Sales for Patient Care in July 1993 and became Vice President-Marketing in
December 1996. In January 2000, Mr. Stotts became Vice President - Marketing and
Sales for Patient Care Products. Prior to his employment with the Company, Mr.
Stotts served as Director of Marketing and Sales for Medtronic Andover Medical,
Inc. Mr. Stotts holds a B.A. degree in Business Administration from Ohio
University.
7
<PAGE>
The Company's Directors are elected at each annual meeting of
shareholders and serve until the next annual meeting and until their successors
are duly elected and qualified. Eugene R. Corasanti's employment is subject to
an employment agreement which expires December 31, 2001. The Company's other
officers are appointed by the Board of Directors and, except as set forth in the
following section, hold office at the will of the Board of Directors.
COMPENSATORY ARRANGEMENTS AND RELATED TRANSACTIONS
The Company has outstanding agreements with certain executive employees
of the Company selected by the Board of Directors, which agreements provide that
the individuals will not, in the event of the commencement of steps to effect a
Change of Control (defined generally as an acquisition of 20% or more of the
outstanding voting shares or a change in a majority of the Board of Director),
voluntarily leave the employ of the Company until a third person has terminated
his or her efforts to effect a Change of Control or until a Change of Control
has occurred.
In the event of a termination of the individual's employment within two
(2) years and six (6) months of a Change of Control, the executive is entitled
to three years' compensation, including bonus, retirement benefits equal to the
benefits he would have received had he completed three additional years of
employment, continuation of all life, accident, health, savings, or other fringe
benefits for three years, as well as any excise or other tax that may become due
as a result of such Change of Control.
The Board of Directors of the Company may terminate any such agreement
upon three years prior written notice. The Board of Directors may also, at any
time, terminate an agreement with respect to any executive employee who is
affiliated with any group seeking or accomplishing a Change of Control. Messrs.
E. Corasanti, J. Corasanti, W. Abraham, J. Scibelli and R. Shallish are each a
party to such an agreement, as are certain other officers of the Company and/or
its subsidiaries.
MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES
The Company's Board of Directors has three standing committees: the
Audit Committee, the Stock Option Committee and the Compensation Committee. The
Company has no nominating committee.
The Audit Committee presently consists of Messrs. Daniels, Matthews and
Remmell. The Audit Committee is charged with evaluating accounting and control
procedures and practices of the Company and reporting on such to the Board of
Directors. The Audit Committee also serves as the direct liaison with the
Company's independent public accountants and recommends the engagement or
discharge of such auditors. The Audit Committee met three times during 1999.
The Stock Option Committee presently consists of Messrs. Daniels and
Remmell and Dr. Schwartz. The Stock Option Committee administers the Company's
employee stock option plans and has authority to grant options to officers and
key employees, as designated by the Stock Option Committee, and to determine the
terms of such options in accordance with such plan. The Stock Option Committee
acted by unanimous written consent on resolutions six times during 1999.
The Compensation Committee presently consists of Messrs. Daniels,
Matthews and Remmell. The Compensation Committee is charged with reviewing and
establishing levels of salary, bonuses, benefits and other compensation for the
Company's officers. The Compensation Committee met three times during 1999, and
voted by unanimous consent once during 1999.
8
<PAGE>
The full Board of Directors met six times (five times in person and
once by telephone) and voted by unanimous consent on resolutions twice during
1999. Each incumbent director attended or acted upon at least 75% of the total
1999 board meetings or unanimous consents and committee meetings or unanimous
consents held or acted upon during periods that he was a member of the Board or
such committees.
Each Director was paid $1,000 for each of the six meetings of the full
Board of Directors personally attended and Messrs. Daniels, Matthews and Remmell
and Dr. Schwartz, as non-employee directors, were paid $2,500 for each of the
four fiscal quarters of service on the Board of Directors. In addition, under
the Company's Stock Option Plan for Non-Employee Directors, each non-employee
director (Messrs. Daniels and Remmell in 1996 and 1997, Messrs. Daniels,
Matthews and Remmell and Dr. Schwartz in 1998 and 1999 and, if elected, Messrs.
Daniels, Matthews and Remmell and Dr. Schwartz in 2000) elected, reelected or
continuing as a director, receives 1,500 options with an option price equal to
the fair market value of the Company's Common Stock on the business day
following each annual meeting of the shareholders.
COMPENSATION OF EXECUTIVE OFFICERS
The following information relates to all plan and non-plan compensation
awarded to, earned by, or paid to (i) Eugene R. Corasanti, the Chairman of the
Board of Directors, President and Chief Executive Officer of the Company (the
"CEO"), (ii) Joseph J. Corasanti, William W. Abraham, Robert D. Shallish, Jr.,
Joseph B. Gross and John V. Scibelli, the Company's most highly compensated
executive officers, other than the CEO, who were serving as executive officers
of the Company at December 31, 1999 (the CEO and such officers, the "Named
Executive Officers").
The following information does not reflect any compensation awarded to
or earned by the Named Executive Officers subsequent to December 31, 1999,
except as may otherwise be indicated. Any compensation awarded to or earned by
the Named Executive Officers during 2000 will be reported in the proxy statement
for the Company's 2001 Annual Meeting of Shareholders, unless such compensation
has been previously reported.
Summary Compensation Table
The following table sets forth for the Named Executive Officers for
each of the last three fiscal years: (i) the name and principal position of the
executive officer (column (a)); (ii) the year covered (column (b)); (iii) annual
compensation (columns (c), (d) and (e)), including: (A) base salary earned
during the year covered (column (c)); (B) bonus earned during the year covered
(column (d)); and (C) other annual compensation not properly categorized as
salary or bonus (column (e)); and (iv) long-term compensation, including the sum
of the number of stock options granted (column (f)).
9
<PAGE>
Summary Compensation Table
<TABLE>
<CAPTION>
Long-Term
Compensation
Annual Compensation Awards
--------------------------------------------- ------
(a) (b) (c) (d) (e) (f)
Fiscal Salary Other Annual Options
Name and Principal Position Year ($) Bonus ($)(1) Compensation ($) (#)
--------------------------- ---- --- ------------ ---------------- ---
<S> <C> <C> <C> <C> <C>
Eugene R. Corasanti, 1999 322,854 65,000 245,900(2) 50,000
Chief Executive Officer and 1998 300,000 45,000 225,000(2) 55,000
Chairman of the Board 1997 300,000 - 202,000(2) 1,500
Joseph J. Corasanti, 1999 170,134 40,000 - 60,000
President and Chief Operating 1998 133,195 21,843 - 30,000
Officer 1997 118,995 10,000 - 22,500
William W. Abraham, 1999 178,907 34,840 - 10,000
Senior Vice President 1998 176,557 25,350 - 5,000
1997 161,007 10,000 - 20,000
Joseph B. Gross, 1999 194,658 34,440 - 50,000
Vice President- 1998 164,900 24,180 - 35,000
Operations and President of 1997 144,957 25,000 - 31,000
Linvatec(3)
Robert D. Shallish, Jr., 1999 161,327 31,574 - 10,000
Chief Financial Officer 1998 158,662 22,893 - 5,000
and Vice President-Finance 1997 144,957 25,000 - 20,000
John V. Scibelli, 1999 165,123 31,044 - 20,000
President of Aspen Laboratories, 1998 62,373 7,500 - 20,000
Inc.(4) 1997 n/a n/a - n/a
- ------------------
</TABLE>
(1) Includes cash bonuses in year earned even if paid after the fiscal
year-end.
(2) Amounts represent deferred compensation and accrued interest for Mr.
Corasanti. See the discussion of Mr. Corasanti's employment agreement,
below.
(3) Mr. Gross resigned effective January 7, 2000.
(4) Mr. Scibelli's employment with the Company commenced on August 31,
1998.
Eugene R. Corasanti has a five-year employment agreement (the
"Employment Agreement") with the Company, extending through December 31, 2001.
The Employment Agreement provides for Mr. Corasanti to serve as chief executive
officer of the Company for five years at an annual salary, not less than
$300,000, as determined by the Board of Directors. Mr. Corasanti also receives
deferred compensation of $100,000 per year with interest at 10% per annum,
payable in 120 equal monthly installments upon his retirement or to his
beneficiaries at death, and is entitled to participate in the Company's employee
stock option plan and pension and other employee benefit plans and such bonus or
other compensatory arrangements as may be determined by the Board of Directors.
In the event that the Board of Directors should fail to re-elect Mr. Corasanti
10
<PAGE>
as chief executive officer or should terminate his employment for reasons other
than just cause, Mr. Corasanti will become entitled to receive the greater of
three years' base annual salary or the balance of his base annual salary plus
the average of the bonuses, deferred compensation and incentive compensation
awarded to Mr. Corasanti during the three years prior to such termination for
the five-term employment term, and shall continue to receive other employment
benefits, for the greater of three years or the balance of the Employment
Agreement's five-year term. In the event of Mr. Corasanti's death or disability,
Mr. Corasanti or his estate or beneficiaries will be entitled to receive 100% of
his base annual salary and other employment benefits (other than deferred
compensation) for the balance of the Employment Agreement's term. If, during the
term of Mr. Corasanti's employment under the Employment Agreement and within two
years after a Change in Control, his employment with the Company is terminated
by the Company, other than for Cause or by him for Good Reason (as such
capitalized terms are defined in the Employment Agreement), Mr. Corasanti will
be entitled to receive (a) a lump sum payment equal to three times the sum of
(i) his base salary on the date of such termination or his base salary in effect
immediately prior to the Change in Control, whichever is higher, plus (ii) the
average of the bonuses, deferred compensation and incentive compensation awarded
to Mr. Corasanti during the three years prior to such termination; (b) continued
coverage under the benefit plans in which he participates for a period of two
years from the date of such early termination; (c) a lump sum payment equal to
the aggregate amount credited to his deferred compensation account; and (d)
awards for the calendar year of such termination under incentive plans
maintained by the Company as though any performance or objective criteria used
in determining such awards were satisfied. The Board of Directors has determined
that Mr. Corasanti's base salary will be $325,000 for 2000.
The Company is paying the premiums on three split-dollar life insurance
policies for Eugene R. Corasanti as described under "Board of Directors
Interlocks and Insider Participation; Certain Relationships and Related
Transactions." In 1999, premiums on these policies paid by the Company
aggregated approximately $52,000.
STOCK OPTION PLANS
1999 Long-Term Incentive Stock Plan
In May 1999, the shareholders approved the CONMED Corporation 1999
Long-Term Incentive Plan (the "1999 Plan"). Under the 1999 Plan, in the
discretion of the Stock Option Committee of the Board of Directors (the
"Committee"), options, performance shares and restricted stock may be granted to
employees and/or consultants of the Company and its subsidiaries. The Committee
presently consists of Messrs. Daniels and Remmell and Dr. Schwartz.
Options may be granted which are (i) incentive stock options within the
meaning of Internal Revenue Code Section 422, (ii) options other than incentive
stock options (i.e., non-qualified options), (iii) performance shares, and (iv)
restricted stock (collectively, the "awards"). A total of 1,000,000 shares of
Common Stock (subject to adjustment for stock splits and other changes in the
Company's capital structure) are reserved against the issuance of awards to be
granted under the 1999 Plan. Shares reserved under an award which for any reason
expires or is terminated, in whole or in part, shall again be available for the
purposes of the 1999 Plan. Options relating to 118,000 shares of Common Stock
have been granted and not terminated under the 1999 Plan. At this time, none of
the options are exercisable. Options relating to 882,000 shares of Common Stock
remain available to be granted.
11
<PAGE>
The 1992 Plan
In April 1992, the shareholders approved the CONMED Corporation 1992
Stock Option Plan (as amended and approved by the shareholders on May 21, 1996,
the "1992 Plan"). Under the 1992 Plan, in the discretion of the Stock Option
Committee of the Board of Directors (the "Committee"), options may be granted to
officers and key employees of the Company and its subsidiaries for the purchase
of shares of Common Stock. The Committee presently consists of Messrs. Daniels
and Remmell and Dr. Schwartz.
Options may be granted which are (i) incentive stock options within the
meaning of Internal Revenue Code Section 422 or (ii) options other than
incentive stock options (i.e., non-qualified options). A total of 2,000,000
shares of Common Stock (subject to adjustment for stock splits and other changes
in the Company's capital structure) are reserved against the exercise of options
to be granted under the 1992 Plan. Shares reserved under an option which for any
reason expires or is terminated, in whole or in part, shall again be available
for the purposes of the 1992 Plan. Options relating to 1,896,289 shares of
Common Stock have been granted and not terminated under the 1992 Plan, of which
options relating to 845,317 shares of Common Stock are still exercisable.
Options relating to 103,711 shares of Common Stock remain available to be
granted.
The 1983 Plan
In June 1983, the shareholders of the Company approved an employee
stock option plan (the "1983 Plan"), which was subsequently amended and approved
by the shareholders on June 30, 1987 and April 10, 1992. Options may be granted
which are (i) incentive stock options within the meaning of Internal Revenue
Code Section 422 or (ii) options other than incentive stock options (i.e.,
non-qualified options). Pursuant to the 1983 Plan, officers and key employees of
the Company were eligible for grants of stock options at the fair market value
of the Company's Common Stock on the date of grant, exercisable commencing one
year after grant. The 1983 Plan is administered by the Committee.
No additional options may be granted under the 1983 Plan. Options
relating to 1,005,753 shares of Common Stock were granted under the 1983 Plan,
of which options for 76,714 shares of Common Stock are still exercisable.
Stock Option Plan for Non-Employee Directors
In May 1995, the shareholders of the Company approved the Stock Option
Plan For Non-Employee Directors of CONMED Corporation (the "Non-Employee
Directors Plan"). All members of the Company's Board of Directors who are not
current or former employees of the Company or any of its subsidiaries
("Non-Employee Directors") are eligible to participate in the Non-Employee
Directors Plan. Under the Non-Employee Directors Plan, each Non-Employee
Director (Cone, Daniels and Remmell in 1996 and 1997, Messrs. Daniels, Matthews
and Remmell and Dr. Schwartz in 1998 and 1999 and if elected, Messrs. Daniels,
Matthews and Remmell and Dr. Schwartz in 2000) elected, reelected or continuing
as a director receives 1,500 options (which are non-qualified stock options
under the Internal Revenue Code of 1986) with an option price equal to the fair
market value of the Company's Common Stock on the business day following each
annual meeting of the shareholders.
A total of 75,000 shares of Common Stock (subject to adjustment for
stock splits and other changes in the Company's capital structure) are reserved
against the exercise of options to be granted and not terminated under the
Non-Employee Directors Plan, of which options for 22,500 shares of Common Stock
have been granted and options for 12,000 shares are still exercisable. Options
relating to 52,500 shares of Common Stock remain available to be granted. Shares
12
<PAGE>
issuable under the Non-Employee Directors Plan may be authorized but unissued
shares or treasury shares. Shares reserved under an option which for any reason
expires or is terminated, in whole or in part, shall again be available for the
purposes of the Non-Employee Directors Plan.
Option Grants Table
The following table sets forth, with respect to grants of stock options
made during 1999 to each of the Named Executive Officers: (i) the name of the
executive officer (column (a)); (ii) the number of securities underlying options
granted (column (b)); (iii) the percent the grant represents of the total
options granted to all employees during 1999; (iv) the per share exercise price
of the options granted (column (d)); (v) the expiration date of the options
(column (e)); and (vi) the potential realizable value of each grant, assuming
the market price of the Common Stock appreciates in value from the date of grant
to the end of the option term at a rate of (A) 5% per annum (column (f)) and (B)
10% per annum (column (g)).
Option Grants in 1999
<TABLE>
<CAPTION>
Potential Realizable Value at
Assumed Annual Rates of Stock
Price Appreciation for
Individual Grants Option Term
---------------------------------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f) (g)
Number of
Securities
Underlying % of Total
Options Options Granted Exercise or
Granted to Employees in Base Price Expiration
Name (#) 1999 ($/Sh) Date 5%($) 10% ($)
- ------------------------ ---------- --------------- ------------- ---- ------ -------------
<S> <C> <C> <C> <C> <C> <C>
Eugene R. Corasanti 50,000 11.30% $29.75 4/27/2009 $935,481 $2,370,692
William W. Abraham 10,000 2.26% $29.75 4/27/2009 $187,096 $474,138
Joseph B. Gross1 25,000 5.65% $27.8125 1/7/2000 $01 $01
--------------
5.65% $29.75 1/7/2000 $01 $01
25,000
Robert D. Shallish, Jr. 10,000 2.26% $29.75 4/27/2009 $187,096 $474,138
Joseph J. Corasanti 50,000 11.30% $27.8125 8/24/2009 $874,557 $2,216,298
10,000 2.26% $29.75 4/27/2009 $187,096 $474,138
John V. Scibelli 10,000 2.26% $27.8125 8/24/2009 $174,911 $443,260
10,000 2.26% $29.75 4/27/2009 187,096 $474,138
</TABLE>
- -------------------------
(1) These options were unvested when Mr. Gross resigned effective January 7,
2000.
13
<PAGE>
Aggregated Option Exercises and Year-End Option Value Table
The following table sets forth, with respect to each exercise of stock
options during 1999 by each of the Named Executive Officers and the year-end
value of unexercised options on an aggregated basis: (i) the name of the
executive officer (column (a)); (ii) the number of shares received upon
exercise, or, if no shares were received, the number of securities with respect
to which the options were exercised (column (b)); (iii) the aggregate dollar
value realized upon exercise (column (c)); (iv) the total number of securities
underlying unexercised options held at December 31, 1999, separately identifying
the exercisable and unexercisable options (column (d)); and (v) the aggregate
dollar value of in-the-money, unexercised options held at December 31, 1999,
separately identifying the exercisable and unexercisable options (column (e)).
The Company's stock option plans do not provide for stock appreciation rights.
Aggregated Option Exercises in 1999 and
December 31, 1999 Option Values
<TABLE>
<CAPTION>
(a) (b) (c) (d) (e)
Name of Securities Underlying Value of Unexercised In-the-Money
Unexercised Options at Options at
12/31/99 (#) 12/31/99 ($)(1)
Shares
Acquired on Value
Name Exercise (#) Realized ($) Exercisable Unexercisable Exercisable Unexercisable
- ---------------------- ------------ ------------ ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Eugene R. Corasanti 0 $0 360,502 50,000 $3,972,438 $0
William W. Abraham 0 $0 150,551 11,501 $1,997,990 $20,202
Joseph B. Gross 23,100 $241,791 9,000 100,900 $3,000 $139,399
Robert D. Shallish, Jr. 3,000 $89,375 62,900 30,300 $688,278 $50,187
Joseph J. Corasanti 0 $0 31,700 104,800 $122,687 $207,843
John V. Scibelli 0 $0 4,000 36,000 $22,250 $89,000
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Assumes $25.875 per share fair market value on December 31, 1999.
PENSION PLANS
The Company maintains a broadly based defined benefit pension plan (the
"Pension Plan") for all employees. The Pension Plan entitles a participant to a
normal monthly retirement benefit equal to 1 1/2% of the participant's average
monthly earnings over the period of employment times years of service. Eugene R.
Corasanti's deferred compensation is not included in the calculation of his
retirement benefits. Benefits are fully vested after five years of service,
starting from date of hire. Upon reaching normal retirement age, generally age
65 with five years of credited service, participants are entitled to receive
vested benefits under the Pension Plan either in the form of a lump sum payment
or a monthly retirement benefit.
The Pension Plan represents a "fresh start" as of January 1, 1989,
replacing the three pension plans formerly in place. The three former plans have
been merged into the Pension Plan, which is the former broadly based plan with
the
14
<PAGE>
benefit formula increased from 1/2% of pay to 1 1/2% of pay. Benefits accrued by
participants under the former plans became fully vested as of December 31, 1988
and are paid, when due, from this "fresh start" Pension Plan. Benefits accrued
under the former plans are payable from the Pension Plan in addition to the
benefits to be received under the Pension Plan. During 1996, Mr. William W.
Abraham reached normal retirement age under the Pension Plan and elected to
receive a lump sum payment of the actuarial equivalent value of his accrued
benefits, as of October 31, 1996.
As of December 31, 1999, Messrs. E. Corasanti, Abraham, Shallish,
Scibelli and J. Corasanti had four, three, ten, one and seven years of credited
service, respectively. The first table presents information concerning the
annual pension payable under the Pension Plan based upon various assumed levels
of annual compensation and years of service.
As of December 31, 1997, the Company acquired Linvatec from BMS. In
connection with the acquisition, the Company established a defined Benefit
Retirement Plan (the "Linvatec Plan") effective January 1, 1998 which provides
the same level of benefits to the Linvatec employees as the BMS plan provided
prior to the acquisition. Assets equal to the present value of the accrued
benefits of the Linvatec employees were transferred from the BMS plan to the new
Linvatec Plan once those figures became available. Participants therefore
continue under the new plan as if nothing had changed.
The Linvatec Plan provides coverage to all employees of the Linvatec
group who have attained the age of 18. The Linvatec Plan provides for benefits
payable to eligible participants in an amount equal to approximately 2% of five
year average earnings less 1/70 of the estimated primary insurance amount
multiplied by the years of service rendered not to exceed 40 years. Benefits are
fully vested after the participant completes 5 years of service. Upon reaching
normal retirement age, generally age 65, participants are entitled to receive
vested benefits under the Linvatec Plan in the form of an annuity payable for
life, or in some other actuarial equivalent option.
As of December 31, 1999, Mr. Gross had twelve years of credited
service. The second table presents information concerning the annual pension
payable under the Linvatec Plan based upon various assumed levels of annual
compensation and years of service.
<TABLE>
<CAPTION>
CONMED Pension Plan
Years of Service
------------------------------------------------------------------------------
Average
Pay 15 20 25 30 35
------------ ------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$125,000 $28,125 $37,500 $46,875 $56,250 $65,625
$150,000 33,750 45,000 56,250 67,500 78,750
$175,000(1) 36,000 48,000 60,000 72,000 84,000
$200,000(1) 36,000 48,000 60,000 72,000 84,000
$225,000(1) 36,000 48,000 60,000 72,000 84,000
$250,000(1) 36,000 48,000 60,000 72,000 84,000
$300,000(1) 36,000 48,000 60,000 72,000 84,000
$400,000(1) 36,000 48,000 60,000 72,000 84,000
$450,000(1) 36,000 48,000 60,000 72,000 84,000
$500,000(1) 36,000 48,000 60,000 72,000 84,000
- ---------------------------------------------------------------------------------------------------------
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
Linvatec Pension Plan
Years of Service
-------------------------------------------------------------------------------------
Average
Pay 15 20 25 30 35
-------------- -------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$125,000 $33,924 $45,232 $56,540 $67,848 $79,156
$150,000 41,424 55,232 69,040 82,848 96,656
$175,000(1) 44,424 59,232 74,040 88,848 103,656
$200,000(1) 44,424 59,232 74,040 88,848 103,656
$225,000(1) 44,424 59,232 74,040 88,848 103,656
$250,000(1) 44,424 59,232 74,040 88,848 103,656
$300,000(1) 44,424 59,232 74,040 88,848 103,656
$400,000(1) 44,424 59,232 74,040 88,848 103,656
$450,000(1) 44,424 59,232 74,040 88,848 103,656
$500,000(1) 44,424 59,232 74,040 88,848 103,656
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
- -------------------------
(1) 1999 statutory limits are $130,000 for straight life annuity benefit
payable at age 65 and $160,000 annual compensation taken into account
in determining average pay.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Company's Board of Directors, pursuant to the terms of the
Employment Agreement, establishes the annual salary of Eugene R. Corasanti. The
Compensation Committee establishes the compensation plans and specific
compensation levels for the Company's other officers. The Stock Option Committee
administers the Company's stock option plans. The Compensation Committee is
presently composed of Bruce F. Daniels, William D. Matthews and Robert E.
Remmell. The Stock Option Committee is presently composed of Bruce F. Daniels,
Robert E. Remmell and Stuart J. Schwartz.
The Board of Directors believes that the compensation of Eugene R.
Corasanti, the Company's Chairman and Chief Executive Officer ("CEO"), should be
heavily influenced by company performance, long-term growth and strategic
positioning. Therefore, although there is necessarily some subjectivity in
setting the CEO's salary, major elements of the compensation package are
directly tied to company performance, long-term growth and strategic
positioning. This philosophy is reflected in Mr. Corasanti's current five-year
employment contract, which provides for a base annual salary of $300,000 and
permits the Board of Directors to determine a higher salary in its discretion.
The Board of Directors believes that the compensation of Joseph J.
Corasanti, the President and Chief Operating Officer ("COO"), should also be
heavily influenced by company performance, long-term growth and strategic
positioning. This philosophy is reflected in the Board's intention to execute in
the near future an employment contract for the COO which is generally similar to
the contract provided to the CEO, and which provides for a base annual salary of
$200,000 and permits the Board of Directors to determine a higher salary in its
discretion.
<PAGE>
In 1993, while the Company consummated the $21.8 million acquisition of
certain assets and the business of Medtronic Andover Medical, Inc. from
Medtronic Inc., the Company incurred a net loss of $1.4 million, primarily as a
result of a $5.0 million charge relating to patent infringement litigation. In
1994, the Company returned to profitability, recording net income of $5.4
million, or $0.56 per diluted share. In 1995, the Company acquired Birtcher
Medical Systems, Inc. (in a $21.2 million stock-for-stock
16
<PAGE>
exchange) and the business and substantially all of the assets of The Master
Medical Corporation (in a $10.0 million purchase transaction) and recorded net
income of $10.9 million, or $0.94 per diluted share. In 1996, the Company
acquired the business and substantially all of the assets of New Dimensions In
Medicine, Inc. in a $34.9 million purchase transaction and continued to increase
the level of net income to $16.3 million, or $1.12 per diluted share.
In the light of the foregoing matters, on November 4, 1996, the Board
of Directors approved Mr. Corasanti's current employment agreement, for
employment from January 1, 1997 through December 31, 2001. In November 1999, the
Board approved amending this agreement so as to provide Mr. Corasanti with the
terms of a Change of Control Agreement as outlined above.
In 1997, the Company continued to integrate its completed acquisitions,
recording then record revenues of $138.2 million. The Company also completed two
additional acquisitions to nearly triple the Company's size -- the acquisition
of a surgical suction instrument and tubing product line from the Davol
subsidiary of C.R. Bard, Inc. for a cash purchase price of $24 million and the
acquisition of Linvatec and certain related assets from BMS for a cash purchase
price of $370 million (plus the assumption of net liabilities totaling
approximately $16.6 million) and the issuance of a warrant to purchase one
million shares of the Company's Common Stock at a warrant exercise price of
$34.23. For 1997, excluding unusual charges related to the acquisition of
Linvatec and the closure of the Company's Dayton, Ohio manufacturing facility,
the Company had net income of $17 million, or $1.12 per diluted share.
In 1998, the Company continued to integrate its completed acquisitions,
again recording record revenues of $336.4 million. The Company, through its
wholly-owned subsidiary Linvatec, acquired an arthroscopic fluid control product
line from Minnesota Mining and Manufacturing Company for a cash purchase price
of $17.5 million. For 1998, excluding a one-time charge in connection with the
refinancing of the Company's credit facility, the Company had net income of
$19.4 million, or $1.26 per diluted share. The Company's stock price has
increased from $7.22 on December 31, 1992 to $33 on December 31, 1998. In light
of these factors, the Board of Directors awarded Mr. Corasanti 1999 base salary
compensation of $312,277.
In 1999, the Company continued to integrate its completed acquisitions,
again recording record revenues of $372.6 million. The Company, through its
wholly-owned subsidiary Linvatec, acquired a powered surgical instrument product
line from Minnesota Mining and Manufacturing Company for a cash purchase price
of $39.0 million, before certain adjustments. For 1999, excluding certain
one-time charges, the Company had net income of $27.4 million, or $1.77 per
diluted share. In light of these factors, the Board of Directors awarded Mr.
Corasanti 2000 base salary compensation of $325,000.
The Compensation Committee has adopted similar policies with respect to
compensation of the other executive officers of the Company. The Company's
performance, long-term growth and strategic positioning and the individual's
past performance and future potential are considered in establishing the base
salaries of executive officers. The policy regarding other elements of the
compensation package for executive officers is similar to the CEO's in that the
package is tied to achievement of performance targets. As discussed below, in
1999, the Company granted each of the Company's executive officers, including
Eugene R. Corasanti, stock options.
Stock options are granted to the Company's executive officers,
including Eugene R. Corasanti, primarily based on the executive's ability to
influence the Company's long-term growth and profitability. The number of
options granted is determined by using the same subjective criteria. All options
are granted at the current market price. Since the value of an option bears a
direct relationship to the Company's stock price it is an effective incentive
17
<PAGE>
for managers to create value for shareholders. The Committee therefore views
stock options as an important component of its long-term, performance-based
compensation philosophy. The Committee granted 50,000 stock options to Eugene R.
Corasanti in 1999. In 1999, the Committee granted 150,000 options to other
executive officers.
The Board of Directors has not yet adopted a policy with respect to
qualification of executive compensation in excess of $1 million per individual
for deduction under Section 162(m) of the Internal Revenue Code of 1986, as
amended, and the regulations thereunder. The Board of Directors does not
anticipate that the compensation of any executive officer during 2000 will
exceed the limits for deductibility. In determining a policy for future periods,
the Board of Directors would expect to consider all relevant factors, including
the Company's tax position and the materiality of the amounts likely to be
involved.
Board of Directors Compensation Committee Stock Option Committee
- ------------------ ---------------------- ----------------------
Eugene R. Corasanti, Chairman Bruce F. Daniels Bruce F. Daniels
Joseph J. Corasanti William D. Matthews Robert E. Remmell
Bruce F. Daniels Robert E. Remmell Stuart J. Schwartz
William D. Matthews
Robert E. Remmell
Stuart J. Schwartz
BOARD OF DIRECTORS INTERLOCKS AND INSIDER PARTICIPATION;
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company's Board of Directors, which is presently composed of Eugene
R. Corasanti, Joseph J. Corasanti, Bruce F. Daniels, William D. Matthews, Robert
E. Remmell and Stuart J. Schwartz, establishes the compensation plans and
specific compensation levels for Eugene R. Corasanti directly (with Mr.
Corasanti abstaining) and for other executive officers through the Compensation
Committee, and administers the Company's stock option plans through the Stock
Option Committee. As disclosed above, Eugene R. Corasanti, the Chairman of the
Board of Directors, is the Chief Executive Officer of the Company and also
serves as an officer of the Company's subsidiaries. Joseph J. Corasanti, a
director of the Company, is the President and Chief Operating Officer of the
Company, also serves as an officer of several of the Company's subsidiaries and
is the son of Eugene R. Corasanti. Robert E. Remmell had served as the Assistant
Secretary of the Company, and as an officer of several of the Company's
subsidiaries, until March 1, 2000, when he resigned from those
positions.
The Company pays all premiums on three split-dollar life insurance
policies totaling $3,175,000 for the benefit of Eugene R. Corasanti. Premiums
paid or accrued by the Company in the fiscal year ended December 31, 1999 were
approximately $52,000. Of such premiums, an aggregate of approximately $1,800
has been reflected as compensation to Mr. Corasanti. The remaining amount of
$50,200 is being treated by the Company as a loan to Mr. Corasanti. At December
31, 1999, the aggregate amount due the Company from Mr. Corasanti related to
these split-dollar life insurance policies is $543,800. This amount (and
subsequent loans for future premiums) will be repaid to the Company on Mr.
Corasanti's death and the balance of the policy will be paid to Mr. Corasanti's
estate or beneficiaries.
Robert E. Remmell, who serves as a director of the Company, and served
as Assistant Secretary and an officer of several of the Company's subsidiaries
until March 1, 2000 when he resigned from such positions, is a partner of
18
<PAGE>
Steates Remmell Steates & Dziekan, the Company's corporate counsel. The Company
has not made any payments to Steates Remmell Steates & Dziekan in 1999.
The Company has entered into directors and officers insurance policies
with National Union Fire Insurance Company of Pittsburgh, PA covering the period
from January 31, 2000 through January 31, 2001 at a total cost of $149,000,
which covers directors and officers of the Company and its subsidiaries.
PERFORMANCE GRAPH
The graph below compares the yearly percentage change in the Company's
Common Stock with the cumulative total return of the Center for Research for
Stock Performance ("CRSP") Total Return Index for the NASDAQ Stock Market and
the cumulative total return of the Standard & Poor's Medical Products and
Supplies Industry Group Index. In each case, the cumulative total return assumes
reinvestment of dividends into the same class of equity securities at the
frequency with which dividends are paid on such securities during the applicable
fiscal year.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
AMONG CONMED CORPORATION,
THE NASDAQ STOCK MARKET (U.S.) INDEX
AND THE S & P HEALTH CARE (MEDICAL PRODUCTS & SUPPLIES) INDEX
[GRAPHIC-OMITTED]
PROPOSAL TWO: INDEPENDENT PUBLIC ACCOUNTANTS
The independent accountants for the Company have been
PricewaterhouseCoopers LLP since 1982. The Audit Committee recommended to the
Board of Directors that PricewaterhouseCoopers LLP be nominated as independent
accountants for 2000, and the Board has approved the recommendation.
Unless otherwise specified, shares represented by proxies will be voted
for the appointment of PricewaterhouseCoopers LLP as independent accountants for
2000. Representatives of PricewaterhouseCoopers LLP are expected to be present
at the meeting. Such representatives will have the opportunity to make a state-
19
<PAGE>
ment if they desire to do so and are expected to be available to respond to
appropriate questions.
The affirmative vote of the holders of a majority of votes cast at the
meeting is necessary for the appointment of PricewaterhouseCoopers LLP as
independent accountants for the Company for 2000.
The Board of Directors recommends a vote FOR this proposal
OTHER BUSINESS
Management knows of no other business which will be presented for
consideration at the Annual Meeting, but should any other matters be brought
before the meeting, it is intended that the persons named in the accompanying
proxy will vote such proxy at their discretion.
SHAREHOLDER PROPOSALS FOR 2001 ANNUAL MEETING
Any shareholder desiring to present a proposal to the shareholders at
the 2001 Annual Meeting, which currently is expected to be scheduled on or about
May 15, 2001, and who desires that such proposal be included in the Company's
proxy statement and proxy card relating to that meeting, must transmit such to
the Company so that it is received by the Company at its principal executive
offices on or before December 19, 2000. All such proposals should be in
compliance with applicable SEC regulations. In addition, shareholders wishing to
propose matters for consideration at the 2001 Annual Meeting or to propose
nominees for election as directors at the 2001 Annual Meeting must follow
specified advance notice procedures contained in the Company's By-laws, a copy
of which is available on request to the Secretary of the Company, c/o CONMED
Corporation, 310 Broad Street, Utica, New York 13501 (Telephone (315) 797-8375).
As of the date of this proxy statement, shareholder proposals, including
director nominee proposals, must comply with the conditions set forth in Section
1.13 of the Company's By-laws and to be considered timely, notice of a proposal
must be received by the Company between February 15, 2001 and March 16, 2001.
By Order of the Board of Directors,
/s/ Thomas M. Acey
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Thomas M. Acey
Secretary
April 14, 2000
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CONMED CORPORATION
310 Broad Street--Utica, New York 13501
Annual Meeting of Shareholders--May 16, 2000
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Eugene R. Corasanti and Robert E.
Remmell, and either of them, proxies of the undersigned, with full power of
substitution, to vote all the shares of Common Stock of CONMED Corporation (the
"Company") held of record by the undersigned on March 29, 2000, at the Annual
Meeting of Shareholders to be held May 16, 2000, and at any adjournment thereof.
(1) Election of Directors
FOR all nominees listed below WITHHOLD AUTHORITY to vote
(except as indicated otherwise below for all nominees listed below
NOMINEES: Eugene R. Corasanti, Robert E. Remmell, Bruce F. Daniels,
William D. Matthews, Stuart J. Schwartz and Joseph J.
Corasanti.
INSTRUCTIONS: To withhold authority to vote for any individual nominee,
write that nominee's name on the space provided below.
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(2) Appointment of PricewaterhouseCoopers LLP as independent accountants of
the Company for 2000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(3) In their discretion the proxies are authorized to vote upon such other
matters as may come before the meeting or any adjournment thereof.
All as more particularly described in the Company's Proxy Statement, dated
April 16, 2000 (the "Company's Proxy Statement"), relating to such meeting,
receipt of which is hereby acknowledged.
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THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS SPECIFIED BY THE UNDERSIGNED
SHAREHOLDER. IF NO CHOICE IS SPECIFIED BY THE SHAREHOLDER, THIS PROXY WILL BE
VOTED "FOR" ALL PORTIONS OF ITEMS (1) AND (2). THIS PROXY WILL BE VOTED IN THE
PROXIES' DISCRETION ON ANY OTHER MATTERS COMING BEFORE THE MEETING.
The undersigned hereby revokes any proxy or proxies heretofore given to
vote upon or act with respect to such stock and hereby ratifies and confirms all
that said proxies, their substitutes or any of them may lawfully do by virtue
hereof.
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Dated:_________________________ , 2000
Please date this Proxy Card and sign
your name exactly as it appears hereon.
Where there is more than one owner, each
should sign. When signing as an
attorney, administrator, executor,
guardian, or trustee, please add your
title as such. If executed by a
corporation, this Proxy Card should be
signed by a duly authorized officer. If
executed by a partnership, please sign
in partnership name by authorized
persons.
Please promptly mark, date, sign and mail this Proxy Card in the enclosed
envelope. No postage is required.
