<PAGE> 1
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------------
FORM 10-Q
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED MARCH 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ____________ TO ____________
COMMISSION FILE NUMBER 1-10235
IDEX CORPORATION
(Exact Name of Registrant as Specified in its Charter)
DELAWARE
(State or other jurisdiction of
incorporation or organization)
630 DUNDEE ROAD, NORTHBROOK, ILLINOIS
(Address of principal executive offices)
36-3555336
(I.R.S. Employer
Identification No.)
60062
(Zip Code)
Registrant's telephone number: (847) 498-7070
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No __
Number of shares of common stock of IDEX Corporation ("IDEX" or the
"Company") outstanding as of April 21, 2000: 29,675,393.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
IDEX CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
2000 1999
----------- ------------
(UNAUDITED)
<S> <C> <C>
ASSETS
Current assets
Cash and cash equivalents................................. $ 4,414 $ 2,895
Receivables -- net........................................ 105,369 100,805
Inventories............................................... 106,138 106,141
Other current assets...................................... 6,827 3,874
-------- --------
Total current assets................................. 222,748 213,715
Property, plant and equipment -- net........................ 127,361 129,917
Intangible assets -- net.................................... 377,831 385,061
Other noncurrent assets..................................... 11,098 9,874
-------- --------
Total assets......................................... $739,038 $738,567
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Trade accounts payable.................................... $ 48,977 $ 44,289
Dividends payable......................................... 4,155 4,153
Accrued expenses.......................................... 47,473 43,192
-------- --------
Total current liabilities............................ 100,605 91,634
Long-term debt.............................................. 249,081 268,589
Other noncurrent liabilities................................ 48,809 49,320
-------- --------
Total liabilities.................................... 398,495 409,543
-------- --------
Shareholders' equity
Common stock, par value $.01 per share
Shares authorized: 2000 and 1999 -- 75,000,000
Shares issued and outstanding: 2000 -- 29,673,893;
1999 -- 29,635,576.................................... 297 296
Additional paid-in capital................................ 100,558 99,802
Retained earnings......................................... 244,984 233,326
Minimum pension liability adjustment...................... (1,759) (1,759)
Accumulated translation adjustment........................ (3,393) (2,543)
Treasury stock............................................ (144) (98)
-------- --------
Total shareholders' equity........................... 340,543 329,024
-------- --------
Total liabilities and shareholders' equity........... $739,038 $738,567
======== ========
</TABLE>
See Notes to Consolidated Financial Statements.
1
<PAGE> 3
IDEX CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED OPERATIONS
(IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
--------------------
2000 1999
---- ----
(UNAUDITED)
<S> <C> <C>
Net sales................................................... $176,662 $156,488
Cost of sales............................................... 106,107 95,168
-------- --------
Gross profit................................................ 70,555 61,320
Selling, general and administrative expenses................ 37,692 34,981
Goodwill amortization....................................... 2,900 2,714
-------- --------
Operating income............................................ 29,963 23,625
Other (expense) income -- net............................... (499) 120
-------- --------
Income before interest expense and income taxes............. 29,464 23,745
Interest expense............................................ 4,164 4,518
-------- --------
Income before income taxes.................................. 25,300 19,227
Provision for income taxes.................................. 9,487 7,306
-------- --------
Net income.................................................. $ 15,813 $ 11,921
======== ========
Basic Earnings Per Common Share............................. $ .53 $ .40
======== ========
Diluted Earnings Per Common Share........................... $ .52 $ .40
======== ========
Share Data:
Weighted average common shares outstanding.................. 29,663 29,464
======== ========
Weighted average common shares outstanding assuming full
dilution.................................................. 30,188 29,880
======== ========
</TABLE>
See Notes to Consolidated Financial Statements.
2
<PAGE> 4
IDEX CORPORATION AND SUBSIDIARIES
STATEMENT OF CONSOLIDATED SHAREHOLDERS' EQUITY
(IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
COMMON
STOCK & MINIMUM
ADDITIONAL PENSION ACCUMULATED TOTAL
PAID-IN RETAINED LIABILITY TRANSLATION TREASURY SHAREHOLDERS'
CAPITAL EARNINGS ADJUSTMENT ADJUSTMENT STOCK EQUITY
---------- -------- ---------- ----------- -------- -------------
<S> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1999.......... $100,098 $233,326 $(1,759) $(2,543) $ (98) $329,024
-------- -------- ------- ------- ----- --------
Net income.......................... 15,813 15,813
Unrealized translation adjustment... (850) (850)
-------- ------- --------
Comprehensive income.............. 15,813 (850) 14,963
-------- ------- --------
Issuance of 40,317 shares of common
stock from exercise of stock
options........................... 757 757
Purchase of common stock............ (46) (46)
Cash dividends declared on common
stock ($.14 per share)............ (4,155) (4,155)
-------- -------- ------- ------- ----- --------
Balance, March 31, 2000
(unaudited)....................... $100,855 $244,984 $(1,759) $(3,393) $(144) $340,543
======== ======== ======= ======= ===== ========
</TABLE>
See Notes to Consolidated Financial Statements.
3
<PAGE> 5
IDEX CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
----------------------
2000 1999
---- ----
(UNAUDITED)
<S> <C> <C>
Cash flows from operating activities
Net income.................................................. $ 15,813 $ 11,921
Adjustments to reconcile to net cash provided by operations:
Depreciation and amortization............................. 5,697 5,352
Amortization of intangibles............................... 3,268 3,063
Amortization of debt issuance expenses.................... 56 139
Deferred income taxes..................................... (463) (141)
Increase in receivables................................... (4,564) (5,455)
Decrease in inventories................................... 3 3,717
Increase (decrease) in trade accounts payable............. 4,688 (1,251)
Increase in accrued expenses.............................. 4,281 553
Other -- net.............................................. (4,904) (1,016)
--------- ---------
Net cash flows from operating activities............... 23,875 16,882
--------- ---------
Cash flows from investing activities
Additions to property, plant and equipment................ (4,348) (4,104)
--------- ---------
Net cash flows from investing activities............... (4,348) (4,104)
--------- ---------
Cash flows from financing activities
Net repayments under credit facilities.................... (11,336) (4,758)
Repayments of other long-term debt........................ (310)
Decrease in accrued interest.............................. (2,596) (2,689)
Dividends paid............................................ (4,152) (4,126)
Proceeds from stock option exercises...................... 432 37
Purchase of common stock.................................. (46) (98)
--------- ---------
Net cash flows from financing activities............... (18,008) (11,634)
--------- ---------
Net increase in cash........................................ 1,519 1,144
Cash and cash equivalents at beginning of year.............. 2,895 2,721
--------- ---------
Cash and cash equivalents at end of period.................. $ 4,414 $ 3,865
========= =========
</TABLE>
<TABLE>
<CAPTION>
SUPPLEMENTAL CASH FLOW INFORMATION
<S> <C> <C>
Cash paid for:
Interest.................................................. $ 6,704 $ 7,136
Income taxes.............................................. 1,598 2,793
</TABLE>
See Notes to Consolidated Financial Statements.
4
<PAGE> 6
IDEX CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. BUSINESS
IDEX Corporation ("IDEX" or the "Company") manufactures an extensive array
of proprietary engineered industrial products sold to customers in a variety of
industries around the world. The Company believes that each of its principal
business units holds the number-one or number-two market share position in each
unit's niche market. IDEX believes that its consistent financial performance has
been attributable to the manufacture of quality proprietary products designed
and engineered by the Company, coupled with its ability to identify and
successfully integrate strategic acquisitions. IDEX consists of three reportable
business segments: Pump Products Group, Dispensing Equipment Group, and Other
Engineered Products Group.
The Pump Products Group designs, produces and distributes a wide variety of
industrial pumps, compressors and related controls for the movement of liquids,
air and gases. The devices and equipment produced by the Group are used by a
large and diverse set of industries, including chemical processing, machinery,
water treatment, medical equipment, petroleum distribution, oil and refining,
and food processing.
The Dispensing Equipment Group produces highly engineered equipment for
dispensing, metering and mixing colorants, paints, inks and dyes; refinishing
equipment; and centralized lubrication systems. This proprietary equipment is
used in a variety of retail and commercial industries around the world. These
units provide componentry and systems for applications such as tinting paints
and coatings; providing industrial and automotive refinishing equipment; and the
precise lubrication of machinery and transportation equipment.
The Other Engineered Products Group manufactures engineered banding and
clamping devices, fire fighting pumps and rescue tools. The high-quality
stainless steel bands, buckles and preformed clamps and related installation
tools are used in applications including securing hoses, signals, pipes, poles,
electrical lines, sign-mounting systems and numerous other "hold-together"
applications. The group also includes a leading manufacturer of truck-mounted
fire pumps and rescue tool systems used by public and private fire and rescue
organizations.
Information about the operations of IDEX in different business segments
follows based on the nature of products and services offered. The Company's
basis of segmentation and basis of segment profit measurement for the three
months ended March 31, 2000, are the same as those set forth under "Business
Segments and Geographic Information" on pages 30 and 31 of the 1999 Annual
Report to Shareholders. Intersegment sales are accounted for at fair value as if
the sales were to third parties. Amounts are in thousands.
5
<PAGE> 7
IDEX CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
--------------------
2000 1999
---- ----
(UNAUDITED)
<S> <C> <C>
Net sales
Pump Products
From external customers................................ $ 98,341 $ 93,661
Intersegment sales..................................... 646 647
-------- --------
Total group sales.................................... 98,987 94,308
-------- --------
Dispensing Equipment
From external customers................................ 39,919 26,259
Intersegment sales..................................... 1
-------- --------
Total group sales.................................... 39,920 26,259
-------- --------
Other Engineered Products
From external customers................................ 38,402 36,568
Intersegment sales..................................... 1 1
-------- --------
Total group sales.................................... 38,403 36,569
-------- --------
Intersegment elimination.................................. (648) (648)
-------- --------
Total net sales...................................... $176,662 $156,488
======== ========
Operating income
Pump Products............................................. $ 19,323 $ 17,253
Dispensing Equipment...................................... 7,217 3,676
Other Engineered Products................................. 7,439 6,315
Corporate Office and Other................................ (4,016) (3,619)
-------- --------
Total operating income............................... $ 29,963 $ 23,625
======== ========
</TABLE>
2. ACQUISITION
On June 4, 1999, IDEX acquired FAST S.p.A. (FAST) at a cost of $61.6
million, with financing provided by borrowings under the Company's U.S. bank
credit facilities and debt acquired from FAST. FAST, with headquarters near
Milan, Italy, is a leading European manufacturer of refinishing and color-
formulation equipment for a number of applications, including paints, coatings,
inks, colorants and dyes. FAST is being operated as part of IDEX's Dispensing
Equipment Group.
The acquisition was accounted for as a purchase, and operating results
include the acquisition from the date of purchase. Cost in excess of net assets
acquired is amortized on a straight-line basis over a period not exceeding 40
years. The unaudited pro forma consolidated results of operations for the three
months ended March 31, 1999, reflecting the allocation of the purchase price and
the related financing of the transaction are as follows, assuming that the
acquisition had occurred at the beginning of the period (in thousands except per
share amounts):
<TABLE>
<CAPTION>
1999
-----------
(UNAUDITED)
<S> <C>
Net sales................................................... $166,608
Net income.................................................. 12,746
Basic EPS -- Net income..................................... .43
Diluted EPS -- Net income................................... .43
</TABLE>
6
<PAGE> 8
IDEX CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
3. EARNINGS PER COMMON SHARE
Earnings per common share (EPS) are computed by dividing net income by the
weighted average number of shares of common stock (basic) plus common stock
equivalents outstanding (diluted) during the year. Common stock equivalents
consist of stock options and have been included in the calculation of weighted
average shares outstanding using the treasury stock method. Basic weighted
average shares reconciles to fully diluted weighted average shares as follows
(in thousands):
<TABLE>
<CAPTION>
FOR THE THREE
MONTHS
ENDED MARCH 31,
----------------
2000 1999
------ ------
(UNAUDITED)
<S> <C> <C>
Basic weighted average common shares outstanding....... 29,663 29,464
Dilutive effect of stock options....................... 525 416
------ ------
Weighted average common shares outstanding assuming
full dilution........................................ 30,188 29,880
====== ======
</TABLE>
4. INVENTORIES
The components of inventories as of March 31, 2000, and December 31, 1999,
were (in thousands):
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
2000 1999
----------- ------------
(UNAUDITED)
<S> <C> <C>
Raw materials and supplies........................ $ 29,954 $ 28,930
Work in process................................... 14,407 12,722
Finished goods.................................... 61,777 64,489
-------- --------
Total........................................... $106,138 $106,141
======== ========
</TABLE>
Those inventories which were carried on a LIFO basis amounted to $85,352
and $86,587 at March 31, 2000, and December 31, 1999, respectively. The excess
of current cost over LIFO inventory value and the impact of using the LIFO
method on earnings are not material.
5. COMMON AND PREFERRED STOCK
The Company had five million shares of preferred stock authorized but
unissued at March 31, 2000, and December 31, 1999.
7
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
HISTORICAL OVERVIEW AND OUTLOOK
IDEX sells a broad range of proprietary pump products, dispensing equipment
and other engineered products to a diverse customer base in the United States
and internationally. Accordingly, IDEX's businesses are affected by levels of
industrial activity and economic conditions in the U.S. and in other countries
where its products are sold, and by the relationship of the U.S. dollar to other
currencies. Among the factors that influence the demand for IDEX's products are
interest rates, levels of capacity utilization and capital spending in certain
industries, and overall industrial activity.
IDEX has a history of above-average operating margins. The Company's
operating margins are affected by, among other things, utilization of facilities
as sales volumes change, and inclusion of newly acquired businesses, which may
have lower margins and whose margins are normally further reduced by purchase
accounting adjustments.
IDEX achieved records in orders, sales, net income and earnings per share
for the first quarter of 2000. New orders for the first quarter totaled $193.2
million, a 16% improvement from the first quarter of last year and 17% ahead of
1999's fourth quarter. As a result, the order backlog rose almost $17 million
during the quarter, the largest increase in the Company's history. IDEX
continues to operate with a relatively low backlog of unfilled orders of about
1 1/3 months' sales. This customarily low level of backlog allows the Company to
provide excellent customer service, but also means that changes in orders are
felt quickly in operating results.
The following forward-looking statements are qualified by the cautionary
statement under the Private Securities Litigation Reform Act set forth below.
Management is very optimistic about the Company's short-and long-term prospects.
IDEX anticipates improving results as the year progresses and expects to achieve
record orders, sales and earning per share in 2000. Several factors should
contribute to the Company's sales and earnings growth. These factors include the
positive trend of leading economic indicators for our end-markets and an
improving international economy. IDEX will also benefit from our continued
emphasis on profitable growth initiatives, margin improvement at recently
acquired businesses, the use of the Company's strong cash flow to cut debt and
interest expense, and the continued pursuit of an active and successful
acquisition strategy. Management believes that IDEX is well-positioned to
continue its profitable growth.
CAUTIONARY STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
The preceding paragraph, the "Liquidity and Capital Resources" and "Euro
Preparations" sections of this management's discussion and analysis of IDEX's
operations contain forward-looking statements within the meaning of Section 27A
of the Securities Act of 1933 and Section 21E of the Exchange Act of 1934. Such
statements relate to, among other things, capital expenditures, cost reduction,
cash flow and operating improvements, and are indicated by words such as
"anticipate," "estimate," "expects," "plans," "projects," "should," "will,"
"management believes," "the Company intends," and similar words or phrases. Such
statements are subject to inherent uncertainties and risks that could cause
actual results to vary materially from suggested results. These uncertainties
and risks include but are not limited to the following: levels of industrial
activity and economic conditions in the U.S. and other countries around the
world; pricing pressures and other competitive factors, and levels of capital
spending in certain industries -- all of which could have a material impact on
order rates and the Company's results, particularly in light of the low levels
of order backlogs typically maintained by the Company; IDEX's ability to
integrate and operate acquired businesses on a profitable basis; the
relationship of the U.S. dollar to other currencies and its impact on pricing
and cost competitiveness; interest rates; utilization of IDEX's capacity and the
effect of capacity utilization on costs; labor market conditions and raw
material costs; developments with respect to contingencies, such as
environmental matters and litigation; and other risks detailed from time to time
in the Company's filings with the Securities and Exchange Commission.
8
<PAGE> 10
RESULTS OF OPERATIONS
For purposes of this discussion and analysis section, reference is made to
the table on the following page and the Company's Statements of Consolidated
Operations included in the Financial Statements section. IDEX consists of three
reportable business segments: Pump Products, Dispensing Equipment and Other
Engineered Products.
PERFORMANCE IN THE THREE MONTHS ENDED MARCH 31, 2000 COMPARED TO THE SAME PERIOD
OF 1999
Orders, sales, net income and earnings per share for the first quarter of
2000 were the highest for any quarter in the Company's history. Incoming orders,
$193.2 million, were 16% higher than in 1999, with the base businesses
contributing the majority of the growth. Net sales for the three months ended
March 31, 2000, were $176.7 million, an increase of 13% over the $156.5 million
for the comparable 1999 period. The FAST acquisition (June 1999) added 4% to
first quarter sales, base business volume was up 11%, but foreign currency
translation had a 2% negative effect. Net income was $15.8 million, 33% higher
than the $11.9 million earned in last year's first quarter. Diluted earnings per
share rose 12 cents to 52 cents, up 30% over the same period a year ago.
In the first quarter of 2000, the Pump Products Group contributed 56% of
sales and 57% of operating income, the Dispensing Equipment Group accounted for
22% of sales and 21% of operating income, and the Other Engineered Products
Group represented 22% of both sales and operating income. International sales
were 40% of total sales, up from 37% in the same quarter of 1999. In the first
quarter of 2000, international sales grew by 20%, while domestic sales increased
by 9%. Excluding FAST, international sales increased 9%.
Pump Products Group sales of $99.0 million for the three months ended March
31, 2000, increased by $4.7 million, or 5%, from 1999 principally reflecting
higher sales volume. Foreign currency had almost no effect on the Group's sales
comparison to 1999. In the first quarter of 2000, international sales grew by
8%, while domestic sales increased by 3%. As a result, sales to customers
outside the U.S. increased to 31% of total group sales in 2000 from 30% in 1999
principally due to higher sales in Europe.
Dispensing Equipment Group sales of $39.9 million increased $13.7 million,
or 52%, in the first quarter of 2000 compared with last year's first quarter.
The FAST acquisition added 24% to first quarter sales, base business volume was
up 34%, but foreign currency translation had a 6% negative effect. In the first
quarter of 2000, international sales grew by 94%, while domestic sales increased
by 23%. The increase in international sales reflected the FAST acquisition and
higher base business volume. Excluding FAST, international sales increased by
34% reflecting higher sales volume in all of the Dispensing Equipment Group's
international markets. Sales to customers outside the U.S. were 51% of total
group sales in 2000, up from 40% in 1999 reflecting the additional international
sales from the FAST acquisition and higher base business international sales.
Other Engineered Products sales of $38.4 million increased by $1.8 million,
or 5%, in the first quarter of 2000 compared with 1999. Overall base business
increased by 8% and foreign currency translation had a negative effect of 3% on
this Group's sales volume. In the first quarter of 2000, domestic sales
increased by 15%, while international sales decreased by 4% with the decline in
international sales principally reflecting foreign currency translation. Sales
to customers outside the U.S. were 48% of total group sales in 2000, down from
52% in 1999.
Gross profit of $70.6 million in the first quarter of 2000 increased by
$9.2 million, or 15%, from 1999 reflecting higher sales volume and productivity
improvements at all of IDEX's business operations. Gross profit as a percent of
sales was 39.9% in 2000, versus 39.2% in 1999 reflecting productivity
improvements. Selling, general and administrative expenses increased 8% to $37.7
million in 2000 from $35.0 million in 1999 principally reflecting volume related
increases and the FAST acquisition. As a percent of net sales, selling, general
and administrative expenses decreased to 21.3% from 22.4% in 1999. Goodwill
amortization increased by 7% to $2.9 million in 2000 from $2.7 million in 1999
reflecting the FAST acquisition. As a percent of sales, goodwill amortization
remained flat at about 2% for both years.
9
<PAGE> 11
IDEX CORPORATION AND SUBSIDIARIES
COMPANY AND BUSINESS GROUP FINANCIAL INFORMATION
(IN THOUSANDS)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
--------------------
2000 1999(1)
---- -------
(UNAUDITED)
<S> <C> <C>
Pump Products Group
Net sales(2).............................................. $ 98,987 $ 94,308
Operating income(3)....................................... 19,323 17,253
Operating margin.......................................... 19.5% 18.3%
Depreciation and amortization............................. $ 4,975 $ 4,909
Capital expenditures...................................... 1,966 1,863
Dispensing Equipment Group
Net sales(2).............................................. $ 39,920 $ 26,259
Operating income(3)....................................... 7,217 3,676
Operating margin.......................................... 18.1% 14.0%
Depreciation and amortization............................. $ 2,138 $ 1,699
Capital expenditures...................................... 1,101 1,197
Other Engineered Products Group
Net sales(2).............................................. $ 38,403 $ 36,569
Operating income(3)....................................... 7,439 6,315
Operating margin.......................................... 19.4% 17.3%
Depreciation and amortization............................. $ 1,768 $ 1,729
Capital expenditures...................................... 1,267 1,017
Company
Net sales................................................. $176,662 $156,488
Operating income.......................................... 29,963 23,625
Operating margin.......................................... 17.0% 15.1%
Depreciation and amortization(4).......................... $ 8,965 $ 8,415
Capital expenditures...................................... 4,348 4,104
</TABLE>
- ---------------
(1) On June 4, 1999, IDEX completed the acquisition of FAST S.p.A. for a cash
purchase price of $61.6 million. The acquisition was accounted for as a
purchase, and operating results include the acquisition from the date of
purchase.
(2) Group net sales include intersegment sales.
(3) Group operating income excludes net unallocated corporate operating
expenses.
(4) Excludes amortization of debt issuance expenses.
10
<PAGE> 12
Operating income increased by 27% to $30.0 million in 2000 from $23.6
million in 1999. Operating income as a percent of sales increased to 17.0% in
2000 from 15.1% in 1999. The increase in operating income and margin growth
reflected improvements at all three business groups and resulted from higher
sales volumes, expense controls and productivity improvements. In the Pump
Products Group, operating income of $19.3 million and operating margin of 19.5%
in 2000 compared to the $17.3 million and 18.3% recorded in 1999. Operating
income of $7.2 million and operating margin of 18.1% in the Dispensing Equipment
Group increased from the $3.7 million and 14.0% recorded in 1999. Operating
income in the Other Engineered Products Group of $7.4 million and operating
margin of 19.4% in 2000 increased from $6.3 million and 17.3% achieved in 1999.
Interest expense decreased to $4.2 million in the first quarter of 2000
from $4.5 million in 1999. The decrease in interest was due to lower interest
rates and debt reductions from operating cash flow.
The provision for income taxes increased to $9.5 million in 2000 from $7.3
million in 1999 reflecting higher income. The effective tax rate decreased to
37.5% in 2000 from 38.0% in 1999.
Net income of $15.8 million in 2000 was 33% higher than net income of $11.9
million in 1999. Diluted earnings per share amounted to 52 cents in 2000, an
increase of 12 cents per share, or 30%, from the 40 cents achieved in 1999.
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 2000, IDEX's working capital was $122.1 million and its
current ratio was 2.2 to 1. The Company's cash flow from operations increased by
$7.0 million to $23.9 million in 2000. The improvement principally reflected
higher income, lower income tax payments, and lower working capital
requirements.
Cash flow provided from operations was more than adequate to fund capital
expenditures of $4.3 million and $4.1 million in 2000 and 1999, respectively.
Capital expenditures were generally for machinery and equipment, which improved
productivity, although a portion was for repair and replacement of equipment and
facilities. Management believes that IDEX has ample capacity in its plant and
equipment to meet expected needs for future growth in the intermediate term.
At March 31, 2000, the maximum amount available under the U.S. Bank Credit
Facility was $235 million, of which $80.1 million was borrowed, including an 82
million Netherlands guilder borrowing ($35.6 million) and a 90 billion Italian
lira borrowing ($44.5 million). The Netherlands guilder and Italian lira
borrowings provide an economic hedge against the net investment in Fluid
Management's Netherlands operation and FAST's Italian operation, respectively.
The availability under this facility declines in stages, to $210 million on July
1, 2000. Any amount outstanding at July 1, 2001, becomes due at that date.
Interest is payable quarterly on the outstanding balance at the agent bank's
reference rate or at LIBOR plus an applicable margin. At March 31, 2000, the
applicable margin was 50 basis points. The Company pays an annual facility fee
of 15 basis points on the total facility.
The Company also has a $15 million demand line of credit available for
short-term borrowing requirements at the bank's reference rate or at an optional
rate based on the bank's cost of funds. At March 31, 2000, the Company had no
borrowings under this short-term line of credit.
At March 31, 2000, the maximum amount available under the Company's German
credit agreement was 52.5 million marks ($25.7 million), of which 16.5 million
marks ($8.1 million) was being used, which provides an economic hedge against
the net investment in Hale Product's German subsidiary. The availability under
this agreement declines to 37 million marks at November 1, 2000. Any amount
outstanding at November 1, 2001, becomes due at that date. Interest is payable
quarterly on the outstanding balance at LIBOR plus an applicable margin. At
March 31, 2000, the applicable margin was 62.5 basis points.
On October 20, 1998, IDEX's Board of Directors authorized the repurchase of
up to 1.5 million shares of common stock either at market prices or on a
negotiated basis as market conditions warrant. Any such purchases would be
funded with borrowings under the Company's existing lines of credit. At March
31, 2000
11
<PAGE> 13
6,500 shares had been repurchased under the program at a cost of approximately
$144,000 including 2,000 shares at a cost of approximately $46,000 during the
first quarter of 2000.
IDEX believes it will generate sufficient cash flow from operations in 2000
to meet its operating requirements, interest and scheduled amortization payments
under the U.S. Bank Credit Facility, the Italian credit facilities and notes
payable, the demand line of credit, the German credit agreement, interest and
principal payments on the Senior Notes, any share repurchases, approximately $25
million of planned capital expenditures, and approximately $17 million of annual
dividend payments to holders of common stock. From commencement of operations in
January 1988 until March 31, 2000, IDEX has borrowed $639 million under its
various credit agreements to complete 14 acquisitions. During this same period
IDEX generated, principally from operations, cash flow of $559 million to reduce
its indebtedness. In the event that suitable businesses are available for
acquisition by IDEX upon terms acceptable to the Board of Directors, IDEX may
obtain all or a portion of the financing for the acquisitions through the
incurrence of additional long-term indebtedness.
YEAR 2000
IDEX initiated a Year 2000 compliance program in late 1996 to ensure that
its information systems and other date-sensitive equipment continue an
uninterrupted transition into the Year 2000. All of the Company's essential
processes, systems, and business functions were compliant with the Year 2000
requirements by the end of 1999. IDEX did not experience any Year 2000
consequences affecting its financial position, liquidity, or results of
operations.
The costs of IDEX's Year 2000 transition program were funded with cash
flows from operations. Some of these costs related solely to the modification of
existing systems, while others were for new systems, which also improved
business functionality. In total, these costs were not substantially different
from the normal, recurring costs incurred for system development and
implementation, in part due to the reallocation of internal resources to
implement the new business systems. Expenditures related to this multi-year
program were approximately $6 million.
EURO PREPARATIONS
During 1998, 1999 and 2000, the Company upgraded its business systems to
accommodate the euro currency. The cost of this upgrade was immaterial to the
Company's financial results. Although difficult to predict, any competitive
implications and any impact on existing financial instruments resulting from the
euro implementation are also expected to be immaterial to the Company's results
of operations, financial position or liquidity.
12
<PAGE> 14
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
The Company is subject to market risk associated with changes in interest
rates and foreign currency exchange rates. Interest rate exposure is limited to
the $249.1 million of long-term debt of the Company outstanding at March 31,
2000. Approximately 11% of the debt is priced at interest rates that float with
the market. A 50 basis point movement in the interest rate on the floating rate
debt would result in an approximate $140,000 annualized increase or decrease in
interest expense and cash flows. The remaining debt is either fixed rate debt or
debt that has been essentially fixed through the use of interest rate swaps. The
Company will from time to time enter into interest rate swaps on its debt when
it believes there is a clear financial advantage for doing so. A formalized
treasury risk management policy adopted by the Board of Directors exists that
describes the procedures and controls over derivative financial and commodity
instruments, including interest rate swaps. Under the policy, the Company does
not use derivative financial or commodity instruments for trading purposes, and
the use of such instruments is subject to strict approval levels by senior
officers. Typically, the use of such derivative instruments is limited to
interest rate swaps on the Company's outstanding long-term debt. The Company's
exposure related to such derivative instruments is, in the aggregate, not
material to the Company's financial position, results of operations and cash
flows.
The Company's foreign currency exchange rate risk is limited principally to
the euro, British pound sterling, German mark, Dutch guilder, Italian lira and
other Western European currencies. The Company manages its foreign exchange risk
principally through the invoicing of its customers in the same currency as the
source of the products.
13
<PAGE> 15
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS. None.
ITEM 2. CHANGES IN SECURITIES. Not Applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES. None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. None.
ITEM 5. OTHER INFORMATION. None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits:
The exhibits listed in the accompanying "Exhibit Index" are filed as
part of this report.
(b) Reports on Form 8-K:
There have been no reports on Form 8-K filed during the quarter for
which this report is filed.
14
<PAGE> 16
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized in the capacity and on the date
indicated.
IDEX CORPORATION
/s/ WAYNE P. SAYATOVIC
--------------------------------------
WAYNE P. SAYATOVIC
Senior Vice President -- Finance
and Chief Financial Officer
(Duly Authorized and Principal
Financial Officer)
April 27, 2000
15
<PAGE> 17
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <S>
3.1 Restated Certificate of Incorporation of IDEX Corporation
(formerly HI, Inc.) (incorporated by reference to Exhibit
No. 3.1 to the Registration Statement on Form S-1 of IDEX,
et al., Registration No. 33-21205, as filed on April 21,
1988)
3.1(a) Amendment to Restated Certificate of Incorporation of IDEX
Corporation (formerly HI, Inc.), (incorporated by reference
to Exhibit No. 3.1(a) to the Quarterly Report of IDEX on
Form 10-Q for the quarter ended March 31, 1996, Commission
File No. 1-10235)
3.2 Amended and Restated By-Laws of IDEX Corporation
(incorporated by reference to Exhibit No. 3.2 to
Post-Effective Amendment No. 2 to the Registration Statement
on Form S-1 of IDEX, et al., Registration No. 33-21205, as
filed on July 17, 1989)
3.2(a) Amended and Restated Article III, Section 13 of the Amended
and Restated By-Laws of IDEX Corporation (incorporated by
reference to Exhibit No. 3.2(a) to Post-Effective Amendment
No. 3 to the Registration Statement on Form S-1 of IDEX, et
al., Registration No. 33-21205, as filed on February 12,
1990)
4.1 Restated Certificate of Incorporation and By-Laws of IDEX
Corporation (filed as Exhibits No. 3.1 through 3.2(a))
4.2 Indenture, dated as of February 23, 1998, between IDEX
Corporation, and Norwest Bank Minnesota, National
Association, as Trustee, relating to the 6 7/8% Senior Notes
of IDEX Corporation due February 15, 2008 (incorporated by
reference to Exhibit No. 4.1 to the Current Report of IDEX
on Form 8-K dated February 23, 1998, Commission File No.
1-10235)
4.3 Specimen Senior Note of IDEX Corporation (incorporated by
reference to Exhibit No. 4.1 to the Current Report of IDEX
on Form 8-K dated February 23, 1998, Commission File No.
1-10235)
4.4 Specimen Certificate of Common Stock of IDEX Corporation
(incorporated by reference to Exhibit No. 4.3 to the
Registration Statement on Form S-2 of IDEX, et al.,
Registration No. 33-42208, as filed on September 16, 1991)
4.5 Third Amended and Restated Credit Agreement dated as of July
17, 1996, among IDEX Corporation, Bank of America NT&SA, as
Agent, and other financial institutions named therein (the
"Banks") (incorporated by reference to Exhibit No. 4.5 to
the Quarterly Report of IDEX on Form 10-Q for the quarter
ended June 30, 1996, Commission File No. 1-10235)
4.5(a) First Amendment to the Third Amended and Restated Credit
Agreement dated as of April 11, 1997 (incorporated by
reference to Exhibit No. 4.5(a) to the Quarterly Report of
IDEX on Form 10-Q for the quarter ended June 30, 1998,
Commission File No. 1-10235)
4.5(b) Second Amendment to the Third Amended and Restated Credit
Agreement dated as of January 20, 1998 (incorporated by
reference to Exhibit No. 4.5(b) to the Quarterly Report of
IDEX on Form 10-Q for the quarter ended June 30, 1998,
Commission File No. 1-10235)
4.5(c) Third Amendment to the Third Amended and Restated Credit
Agreement dated as of February 9, 1998 (incorporated by
reference to Exhibit No. 4.5(c) to the Quarterly Report of
IDEX on Form 10-Q for the quarter ended June 30, 1998,
Commission File No. 1-10235)
4.5(d) Fourth Amendment to the Third Amended and Restated Credit
Agreement dated as of April 3, 1998 (incorporated by
reference to Exhibit No. 4.5(d) to the Quarterly Report of
IDEX on Form 10-Q for the quarter ended June 30, 1998,
Commission File No. 1-10235)
4.5(e) Fifth Amendment to the Third Amended and Restated Credit
Agreement dated as of June 8, 1999 (incorporated by
reference to Exhibit No. 4.5(e) to the Quarterly Report of
IDEX on Form 10-Q for the quarter ended June 30, 1999,
Commission File No. 1-10235)
10.1* IDEX Corporation Amended and Restated Stock Option Plan for
Outside Directors
10.2* Amended and Restated Employment Agreement between IDEX
Corporation and Wayne P. Sayatovic, dated March 31, 2000
</TABLE>
16
<PAGE> 18
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <S>
10.3* First Amendment to the Letter Agreement between IDEX
Corporation and Wayne P. Sayatovic, dated March 15, 2000
10.4* First Amendment to the Letter Agreement between IDEX
Corporation and James R. Fluharty, dated March 15, 2000
10.5* First Amendment to the Letter Agreement between IDEX
Corporation and Rodney L. Usher, dated March 15, 2000
27* Financial Data Schedule
</TABLE>
- -------------------------
* Filed herewith
17
<PAGE> 1
Exhibit 10.1
IDEX CORPORATION
AMENDED AND RESTATED
STOCK OPTION PLAN
FOR OUTSIDE DIRECTORS
IDEX Corporation, a corporation organized under the laws of the State of
Delaware (the "Company"), adopted the IDEX Corporation Stock Option Plan For
Outside Directors (the "Plan") effective April 24, 1990. The original purposes
of the Plan were as follows:
(1) To further the growth, development and financial success of the
Company and its subsidiaries by providing additional incentives to Outside
Directors (as defined below), by assisting them to become owners of capital
stock of the Company and thus to benefit directly from its growth,
development and financial success.
(2) To enable the Company to obtain and retain the services of the
type of Outside Directors considered essential to the long-range success of
the Company by providing and offering them an opportunity to become owners
of capital stock of the Company under options.
Under the original terms of the Plan, no options could be granted more
than ten years after its adoption by the Board (as defined below). As a
significant number of shares were still available for grant of options under
the Plan upon the original expiration date of the Plan, it is in the best
interest of the Company to continue the Plan and the grant of options to
Outside Directors thereunder. Therefore, the following constitutes an
amendment, restatement, continuation and extension of the Plan beyond its
original term, effective upon approval of this IDEX Corporation Amended and
Restated Stock Option Plan for Outside Directors by the stockholders of the
Company, as provided in Section 7.3 hereof.
ARTICLE I
DEFINITIONS
Whenever the following terms are used in the Plan, they shall have the
meanings specified below.
Board -- the Board of Directors of the Company.
Change in Control Event -- a "Change of Control Event" shall mean the
occurrence of (a) any transaction or series of transactions which within a
12-month period constitute a change of management or control where (i) at least
51 percent of the then outstanding shares of Common Stock are (for cash,
property (including, without limitation, stock in any corporation), or
indebtedness, or any combination thereof) redeemed by the Company or purchased
by any person(s), firm(s) or entity(ies), or exchanged for shares in any other
corporation whether or not affiliated with the Company, or any combination of
such redemption, purchase or exchange, or (ii) at least 51 percent of the
Company's assets are purchased by any
<PAGE> 2
person(s), firm(s) or entity(ies) whether or not affiliated with the Company
for cash, property (including, without limitation, stock in any corporation) or
indebtedness or any combination thereof, or (iii) the Company is merged or
consolidated with another corporation regardless of whether the Company is the
survivor (except any such transaction solely for the purpose of changing the
Company's domicile or which does not change the ultimate beneficial ownership
of the equity interests in the Company), or (b) any substantial equivalent of
any such redemption, purchase, exchange, change, transaction or series of
transactions, acquisition, merger or consolidation constituting such a change
of management or control. For purposes hereof, the term "control" shall have
the meaning ascribed thereto under the Exchange Act and the regulations
thereunder, and the term "management" shall mean the chief executive officer of
the Company. For purposes of clause (a)(ii) above or as appropriate for
purposes of clause (b) above, the Company shall be deemed to include on a
consolidated basis all subsidiaries and other affiliated corporations or other
entities with the same effect as if they were divisions.
Code -- the Internal Revenue Code of 1986, as amended.
Committee -- a committee consisting of each member of the Compensation
Committee of the Board who is then a disinterested person within the meaning of
Rule 16b-3.
Common Stock -- the Company's Common Stock, par value $.01 per share.
Company -- IDEX Corporation and any corporation assuming, or issuing new
stock options in substitution for, Options.
Director -- a member of the Board.
Exchange Act -- the Securities Exchange Act of 1934, as amended.
Fair Market Value -- the "Fair Market Value" of a share of Common Stock as
of a given date shall be: (i) if Common Stock is traded on an exchange then the
closing price of a share of Common Stock as reported in the Wall Street Journal
for the first trading date immediate prior to such date during which a sale
occurred; or (ii) if Common Stock is not traded on an exchange but is quoted on
NASDAQ or a successor or other quotation system, (x) the last sales price (if
the Common Stock is then listed as a National Market Issue under the NASD
National Market System) or (y) the mean between the closing representative bid
and asked prices (in all other cases) for the Common Stock on the date
immediately prior to such date on which sales prices or bid and asked prices, as
applicable, are reported by NASDAQ or such successor quotation system; or (iii)
if such Common Stock is not publicly traded on an exchange and not quoted on
NASDAQ or a successor quotation system, the mean between the closing bid and
asked prices for the Common Stock on the day previous to such date, as
determined in good faith by the Committee; or (iv) if the Common Stock is not
publicly traded, the fair market value established by the Committee acting in
good faith.
Officer -- the President, any Vice President, the Secretary or any
Assistant Secretary of the Company.
2
<PAGE> 3
Option -- an option to purchase Common Stock granted under the Plan, which
option shall not constitute an option that meets the requirements of Section 422
of the Code.
Optionee -- an Outside Director to whom an Option is granted under the
Plan.
Outside Director -- a Director who is not then (i) a full-time employee (as
defined in accordance with the regulations and revenue rulings then applicable
under Section 3401(c) of the Code) of the Company or of any corporation that is
then a Parent Corporation or a Subsidiary or (ii) a general partner, limited
partner or full-time employee of either KKR Associates, L.P. or Kohlberg Kravis
Roberts & Co., L.L.C.
Parent Corporation -- any corporation that owns, directly or indirectly,
more than 50% of the voting power of the shares of stock entitled (without
regard to the occurrence of any contingency) to vote in the election of
Directors.
Retirement -- the Termination of Service on or after the date the Director
attains age sixty (60).
Rule 16b-3 -- that certain Rule 16b-3, as such rule is then in effect, that
has been adopted by the Securities and Exchange Commission under the Exchange
Act, or any replacement rule adopted thereunder.
Secretary -- the Secretary of the Company.
Securities Act -- the Securities Act of 1933, as amended.
Subsidiary -- any corporation of which more than 50% of the total voting
power of the shares of capital stock entitled (without regard to the occurrence
of any contingency) to vote in the election of directors thereof is owned,
directly or indirectly, by the Company.
Termination of Service -- the effective time at which a person serving as a
Director ceases to be a member of the Board for any reason.
ARTICLE II
SHARES SUBJECT TO PLAN
SECTION 2.1 * SHARES SUBJECT TO PLAN
The shares of stock subject to Options shall be shares of the Company's
Common Stock. The aggregate number of such shares which may be issued upon
exercise of Options shall not exceed 337,500(1).
SECTION 2.2 * UNEXERCISED OPTIONS
- --------------
1 Reflects 3 for 2 stock splits occurring on January 31, 1995 and January 31,
1997.
3
<PAGE> 4
If any Option expires or is cancelled without having been fully exercised,
the number of shares subject to such Option, but as to which such Option was
not exercised prior to its expiration or cancellation, may again be optioned
hereunder, subject to the limitations of Section 2.1.
4
<PAGE> 5
SECTION 2.3 * CHANGES IN COMPANY'S SHARES
In the event that the outstanding shares of Common Stock are hereafter
changed into or exchanged for a different number or kind of shares or other
securities of the Company or of another corporation by reason of
reorganization, merger, consolidation, recapitalization, reclassification,
stock split, stock dividend or combination of shares, appropriate adjustments
shall be made by the Committee in the number and kind of shares for the
purchase of which Options may be granted, including adjustments of the
limitation in Section 2.1 on the maximum number and kind of shares which may be
issued upon exercise of Options. In the event of an adjustment contemplated by
this Section 2.3 in any outstanding Options, the Committee shall make an
appropriate and equitable adjustment to the end that after such event the
Optionee's proportionate interest shall be maintained as before the occurrence
of such event. Such adjustment in any outstanding Options shall be made
without change in the total price applicable to the option or the unexercised
portion of any Option (except for any change in the aggregate price resulting
from rounding off or share quantities or prices) and with any necessary
corresponding adjustment in the Option price per share. In the event of a
"spin-off" or other substantial distribution of assets of the Company which has
a material diminutive effect upon Fair Market Value, the Committee may in its
discretion make an appropriate and equitable adjustment to the Option exercise
price to reflect such diminution. Any such adjustment made by the Committee
shall be final and binding upon all Optionees, the Company and all other
interested persons.
ARTICLE III
GRANTING OF OPTIONS
SECTION 3.1 * ELIGIBILITY
Any person who (a) is an Outside Director on January 1, 2000 or (b)
thereafter becomes an Outside Director shall be granted Options under Section
3.2.
SECTION 3.2 * GRANTING OF OPTIONS
(a) Subject to Section 2.1, Options shall be granted as follows:
(i) Each person who first becomes an Outside Director between
January 1, 2000 and April 18, 2000 shall receive, on the date that
this Plan is approved by the Company's stockholders in accordance with
Section 7.3, an Option to purchase 6,750 shares of Common Stock;
(ii) Each person who first becomes an Outside Director on or
after April 19, 2000 shall receive, as of the date on which such
person first becomes an
5
<PAGE> 6
Outside Director, an Option to purchase 6,750 shares of Common Stock;
provided, however, that each person who, immediately prior to becoming
an Outside Director, was either (i) a full-time employee of the
Company or any of its subsidiaries or (ii) a partner or full-time
employee of either Kohlberg Kravis Roberts & Co., L.L.C. or KKR
Associates, L.P., shall not receive such an option; and
(iii) On the date of the first regularly scheduled meeting of the
Board held in January of each year, commencing with the meeting held
in January 2001, any person who is an Outside Director on such date
shall receive an Option to purchase 4,500 shares of Common Stock.
(b) The Committee shall instruct the Secretary or other
authorized Officer to execute and deliver a stock option agreement
(described in Section 4.1) to each person who becomes entitled to an
Option under Section 3.2(a).
ARTICLE IV
TERMS OF OPTIONS
SECTION 4.1 * OPTION AGREEMENT
Each Option shall be evidenced by a written stock option agreement, which
shall be executed by the Optionee and an authorized Officer and which shall
contain such terms and conditions as the Committee shall determine, consistent
with the Plan.
SECTION 4.2 * OPTION PRICE
The price of the shares subject to each Option shall be the Fair Market
Value of such shares on the date such Option is granted.
SECTION 4.3 * COMMENCEMENT OF EXERCISABILITY
(a) Subject to the provisions of Sections 4.3(b) and 4.3(c), each
Option shall become fully vested and exercisable upon the first to occur of
the following events:
(i) the second anniversary of the date of such Option grant;
(ii) the Optionee's becoming disabled (within the meaning of
Section 22(e)(3) of the Code);
(iii) the Optionee's Termination of Service because of his death
or his Retirement; or
(iv) the occurrence of a Change in Control Event.
6
<PAGE> 7
(b) Notwithstanding the provisions of Section 4.3(a), no Option shall
be exercisable in a manner that would disqualify the Plan from satisfying
the requirements of Rule 16b-3, and, to the extent necessary, no Option
shall be exercisable for at least 6 months (or such other period as may be
specified in such Rule) after the date such Option is granted.
(c) Except in the event of the subsequent determination of disability,
at the time of Termination of Service under subsection 4.3(a)(ii), no
portion of an Option that is unexercisable on the date of the Optionee's
Termination of Service shall thereafter become exercisable.
SECTION 4.4 * EXPIRATION OF OPTIONS
No Option may be exercised to any extent by anyone after the first to
occur of the following events:
(a) the expiration of ten years from the date the Option was granted;
(b) the expiration of one year from the date of the Optionee's
Termination of Service for any reason other than Retirement; provided,
however, that Section 4.4(d) shall apply if the Optionee dies or becomes
disabled (within the meaning of Section 22(e)(3) of the Code) prior to the
expiration of such one-year period;
(c) the expiration of three years from the date of the Optionee's
Termination of Service by reason of Retirement.
(d) if the Optionee dies or becomes disabled prior to the first
anniversary of the Optionee's Termination of Service, the expiration of 1
year from the earlier of (i) the date of the Optionee's death, or (ii) the
date on which the Optionee becomes disabled (within the meaning of Section
22(e)(3) of the Code).
SECTION 4.5 * RIGHTS TO CONTINUED SERVICE
Nothing in the Plan or in any Stock Option Agreement hereunder shall
confer upon any Optionee any right to continue as a Director.
ARTICLE V
EXERCISE OF OPTIONS
SECTION 5.1 * PERSONS ELIGIBLE TO EXERCISE
(a) Subject to Section 5.1(b) and (c), during the lifetime of the
Optionee, only he may exercise an Option (or any portion thereof) granted
to him. After the death of the
7
<PAGE> 8
Optionee, any exercisable portion of an Option may, prior to the time when
such portion becomes unexercisable under the Plan or the applicable Stock
Option Agreement, be exercised by his personal representative or by any
person empowered to do so under the deceased Optionee's will or under the
then applicable laws of descent and distribution.
(b) Should the Optionee be determined under applicable law to have
become a disabled person or the equivalent thereof, the Option may, prior
to the time when the Option becomes unexercisable under the Plan or the
applicable Stock Option Agreement, be exercised by the Optionee's guardian
or by any other person empowered to do so under applicable laws of
guardianship. For purposes of this Section 5.1(b), "disabled person" shall
mean a person who (i) because of mental deterioration or physical
incapacity is not fully able to manage his person or estate or (ii) is
mentally ill and who because of his mental illness is not fully able to
manage his person or estate.
(c) Notwithstanding the foregoing provisions of this Section 5.1, the
Committee, in its sole discretion, may permit the Optionee with prior
written notice to the Committee to transfer by gift, without the receipt of
any consideration, to a member of the Optionee's immediate family, as
defined in Rule 16a-1 under the Exchange Act, or to a trust for the
exclusive benefit of, or any other entity owned solely by, such members,
provided that an Option that has been so transferred shall continue to be
subject to all of the terms and conditions of the Option Agreement as
applicable to the Optionee, and the transferee shall execute any and all
such documents requested by the Committee in connection with the transfer,
including without limitation to evidence the transfer and to satisfy any
requirements for an exemption for the transfer under applicable federal and
state securities laws.
SECTION 5.2 * PARTIAL EXERCISE
At any time and from time to time before any exercisable Option or
exercisable portion thereof becomes unexercisable under the Plan or the
applicable Stock Option Agreement, such Option or portion thereof may be
exercised in whole or in part; provided, however, that the Company shall not be
required to issue fractional shares and no Option may be exercised for less
than 1,000 shares of Common Stock unless such exercise is the full exercise of
the exercisable portion of such Option.
SECTION 5.3 * MANNER OF EXERCISE
An exercisable Option, or any exercisable portion thereof, may be
exercised solely by delivery to the Secretary or his office of all of the
following prior to the time when such Option or such portion becomes
unexercisable under the Plan or the applicable Stock Option Agreement:
(a) Notice in writing signed by the Optionee or other person then
entitled to exercise such Option or portion thereof, stating that such
Option or portion thereof is thereby exercised, such notice complying with
all applicable rules established by the
8
<PAGE> 9
Committee;
(b) (i) Full payment (in cash or by check) for the shares with respect
to which such Option or portion thereof is thereby exercised;
(ii) With the consent of the Committee, shares of Common Stock
which have been owned by the Optionee for more than six months on the
date of delivery and duly endorsed for transfer to the Company with a
Fair Market Value on the date of delivery equal to the aggregate
Option price of the shares with respect to which such Option or
portion thereof is thereby exercised;
(iii) To the extent permitted by law (including the then
interpretations of Rule 16b-3), a "cashless exercise procedure"
satisfactory to the Committee which permits the Optionee to deliver an
exercise notice to a broker-dealer, who then sells Option shares, and
delivers the proceeds of the sale, less commission, to the Company
which delivers such proceeds, less the exercise price and withholding
taxes to the Optionee; or
(iv) Any combination of the consideration provided in the
foregoing subsections (i), (ii) or (iii);
(c) Such representations and documents as the Committee, in its
absolute discretion, deems necessary or advisable to effect compliance with
all applicable provisions of the Securities Act and any other federal or
state securities laws or regulations. The Committee may, in its absolute
discretion, also take whatever additional actions it deems appropriate to
effect such compliance, including without limitation placing legends on
share certificates and issuing stop-transfer orders to transfer agents and
registrars; and
(d) In the event that the Option or portion thereof shall be exercised
pursuant to Section 5.1 by any person or persons other than the Optionee,
appropriate proof of the right of such person or persons to exercise the
Option or portion thereof.
SECTION 5.4 * CONDITIONS TO ISSUANCE OF STOCK CERTIFICATES
The shares of Common Stock issuable and deliverable upon the exercise of
an Option or any portion thereof may be either previously authorized but
unissued shares or issued shares which have been reacquired by the Company.
The Company shall not be required to issue or deliver any certificate or
certificates for shares of stock purchased upon the exercise of any Option or
portion thereof prior to fulfillment of all of the following conditions:
(a) The listing of such shares on all stock exchanges on which such
class of stock is then listed; and
(b) The completion of any registration or other qualification of such
shares,
9
<PAGE> 10
and the obtaining of any other approval or clearance from any state or
federal governmental agency which the Committee shall, in its absolute
discretion, determine to be necessary or advisable; and
(c) The payment to the Company of all amounts which it is required to
withhold under federal, state or local law in connection with the exercise
of the Option.
10
<PAGE> 11
SECTION 5.5 * RIGHTS AS STOCKHOLDERS
The holders of Options shall not be, nor have any of the rights or
privileges of, stockholders of the Company in respect of any shares purchasable
upon the exercise of an Option or any portion thereof unless and until
certificates representing such shares have been issued by the Company to such
holders.
ARTICLE VI
ADMINISTRATION
It shall be the duty of the Committee to conduct the general
administration of the Plan in accordance with its provisions. The Committee
shall have the power to interpret the Plan and the Options, to adopt such rules
for the administration, interpretation and application of the Plan as are
consistent therewith, and to interpret, amend or revoke any such rules. No
member of the Committee shall be liable for any action or determination made in
good faith with respect to the Plan or any Option.
ARTICLE VII
OTHER PROVISIONS
SECTION 7.1 * OPTIONS NOT TRANSFERABLE
No Option or interest or right therein or part thereof shall be liable for
the debts, contracts or engagements of the Optionee or his successors in
interest or shall be subject to disposition by transfer, alienation,
anticipation, pledge, encumbrance, assignment or any other means, whether such
disposition be voluntary or involuntary or by operation of law by judgment,
levy, attachment, garnishment or any other legal or equitable proceedings
(including bankruptcy), and any attempted disposition thereof shall be null and
void and of no effect; provided, however, that nothing in this Section 7.1
shall prevent transfers by will, by the applicable laws of descent and
distribution, or as provided in Section 5.1(c).
SECTION 7.2 * AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN; MODIFICATION OF
OPTIONS
(a) The Plan may be amended or otherwise modified, suspended or
terminated at any time and from time to time by the Board; provided,
however, the provisions of Sections 3.1 (Eligibility), 3.2 (Granting of
Options) and 4.2 (Option Price) shall not be modified more than once every
six months, other than to comport with the changes in the Internal Revenue
Code, the Employee Retirement Income Security Act or the rules thereunder;
provided, further that without approval of the Company's stockholders given
within 12 months after the action by the Board, the Board may not, except
as provided in Section 2.3, increase any limit imposed in Section 2.1 on
the Options, modify the eligibility requirements of Section 3.1, increase
the number of Options granted or accelerate the timing of those grants
under Section 3.2, reduce the minimum Option price
11
<PAGE> 12
requirements of Section 4.2 or extend the limit imposed in this Section 7.2
on the period during which Options may be granted and such action by the
Board shall become effective only after stockholder approval is obtained;
and provided, further, that no amendment or modification may be made if
such amendment or modification would disqualify the Plan from satisfying
the requirements of the Securities Act or the Exchange Act or any
regulation or rule promulgated by the Securities and Exchange Commission
thereunder. None of the amendment, suspension or termination of the Plan
shall, without the consent of the holder of the Option, alter or impair any
rights or obligations under any Option theretofore granted. No Option may
be granted during any period of suspension of the Plan, and in no event may
any Option be granted under the Plan after April 19, 2009.
(b) An Option shall be subject in all events to the condition that, if
at any time the Board shall determine, in its discretion, that the listing,
registration or qualification of any of the Company's securities upon any
securities exchange or under any law, regulation or other requirement of
any governmental authority is necessary or desirable, or that any consent
or approval from any governmental authority is necessary or desirable, then
the Board may modify the terms of any Option granted under the Plan,
without the consent of the Optionee, in any manner which the Board deems
necessary or desirable in order to improve the Company's ability to obtain
such listing, registration, qualification, consent or approval.
SECTION 7.3 * APPROVAL OF PLAN BY STOCKHOLDERS
The amendment, restatement and continuation of the Plan will be submitted
for the approval of the Company's stockholders and shall be effective only upon
attainment of such approval.
SECTION 7.4 * EFFECT OF PLAN UPON OTHER OPTION AND COMPENSATION PLANS
This Plan shall not affect any other compensation or incentive plans in
effect for the Company, any Parent Corporation or any Subsidiary. Nothing in
the Plan shall be construed to limit the right of the Company, any Parent
Corporation or any Subsidiary (a) to establish any other forms of incentives or
compensation for employees or (b) to grant or assume options otherwise than
under the Plan in connection with any proper corporate purpose, including
without limitation the grant or assumption of options in connection with the
acquisition by purchase, merger, consolidation or otherwise, of the business,
stock or assets of any corporation, firm or association.
SECTION 7.5 * NO OBLIGATION TO REGISTER
The Company shall not be deemed, by reason of the granting of any Option,
to have any obligation to register the shares of Common Stock subject to such
Option under the Securities Act or to maintain in effect any registration of
such shares which may be made at any time under the Securities Act.
12
<PAGE> 13
SECTION 7.6 * CONFORMANCE TO SECURITIES ACT AND EXCHANGE ACT
The Plan is intended to conform to the provisions of the Securities Act
and the Exchange Act and any and all regulations and rules promulgated by the
Securities and Exchange Commission thereunder. Notwithstanding anything herein
to the contrary, the Plan shall be administered, and Options shall be granted
and may be exercised, only in such a manner as to conform to the provisions of
the Securities Act and Exchange Act and any and all such regulations.
* * * *
I hereby certify that the foregoing Amended and Restated Stock Option Plan
for Outside Directors was duly adopted by the Board of Directors of IDEX
Corporation on January 25, 2000 and approved by the stockholders of the IDEX
Corporation on April 19, 2000
Executed on this 19th day of April, 2000.
/s/ Frank J. Notaro
Secretary
Corporate Seal
13
<PAGE> 1
Exhibit 10.2
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
BETWEEN
IDEX CORPORATION
AND
WAYNE P. SAYATOVIC
<PAGE> 2
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS AGREEMENT, made as of the 31st day of March, 2000, between IDEX
CORPORATION, a Delaware corporation with its executive offices at 630 Dundee
Road, Suite 400, Northbrook, Illinois 60062 ("IDEX"), and WAYNE P. SAYATOVIC,
91 Mallard Lane, Lake Forest, Illinois 60045 (the "Executive").
IDEX and the Executive entered into an Employment Agreement dated as of
January 22, 1988 (the "Effective Date") and executed by the Executive on May
10, 1989 and by IDEX on May 12, 1989, subsequently amended as of January 13,
1993 and as of September 27, 1994; and amended and restated in its entirety as
of November 22, 1996. The parties now wish to modify certain provisions of the
Employment Agreement and to restate the Employment Agreement in its entirety as
modified. Therefore, IDEX and the Executive agree as follows:
1. Introductory statement. The Executive has previously served as an
executive of Houdaille Industries, Inc. ("Houdaille"). IDEX purchased from
Houdaille all of the shares of stock of all of the active subsidiaries of
Houdaille other than John Crane-Houdaille, Inc. (the "NonCrane Subsidiaries")
on January 22, 1988 and desires to secure the full-time services of the
Executive until at least the third anniversary of the Effective Date on the
terms and conditions as provided in this Agreement. The Executive is willing
to execute this
<PAGE> 3
- 3 -
Agreement with respect to his employment upon the terms and conditions set
forth in this Agreement. This Agreement amends and restates in its entirety
all previous employment agreements between the Executive and IDEX.
2. Agreement of employment. IDEX agrees to, and hereby does, employ the
Executive, and the Executive agrees to, and hereby does accept, employment by
IDEX, or one of its subsidiaries, as the case may be (hereafter in the
aggregate, the "Corporation"), as an executive of the Corporation, subject to
the provisions of the by-laws of the Corporation in respect of the duties and
responsibilities assigned from time to time by the Chief Executive Officer of
the Corporation and subject also at all times to the control of the Board of
Directors of the Corporation.
The Corporation shall not require the Executive to perform services
hereunder away from the Chicago, Illinois area of such frequency and duration
as would necessitate, in the reasonable judgment of the Executive, the
Executive moving his residence from the Chicago, Illinois area. Following an
Acquisition (as hereinafter defined), the Corporation shall not, in the
reasonable judgment of the Executive, (a) significantly reduce the scope of the
duties of the Executive hereunder or (b) significantly reduce the total
potential compensation of the Executive hereunder. If the Executive determines
in accordance with the preceding sentences that (a) the
<PAGE> 4
- 4 -
services required by the Corporation necessitate that the Executive move his
residence from the Chicago, Illinois area, (b) the duties of the Executive
hereunder have been significantly reduced or (c) the total potential
compensation of the Executive hereunder has been significantly reduced, the
Executive, in his sole discretion, may deem that the Corporation has terminated
his services and shall so notify the Corporation in writing, in which case the
Corporation shall be deemed to have terminated the services of the Executive
for all purposes of this Agreement as of the date specified by the Executive in
his notice to the Corporation.
3. Executive's obligations: vacations, automobile. During the period of
his full-time service under this Agreement, the Executive shall devote
substantially all of his time and energies during business hours to the
supervision and conduct, faithfully and to the best of his ability, of the
business and affairs of the Corporation, and to the furtherance of its
interests, and shall not accept other gainful employment except with the prior
consent of the Chief Executive Officer of the Corporation. With the approval
of the Chief Executive Officer of the Corporation, however, the Executive may
become a director, trustee or other fiduciary of other corporations, trusts or
entities. The Executive may take four weeks vacation each year with pay. The
Corporation shall furnish and maintain an automobile for the use of the
Executive consistent with the policy of the Corporation in effect at any time;
provided, however, that at no time shall the policy of the Corporation be
materially less generous than the policy of the Corporation in effect as of
January 1, 2000.
<PAGE> 5
- 5 -
4. Annual salary. The Corporation shall pay to the Executive for his
services under this Agreement a salary at the rate of $231,500 per year
commencing as of January 1, 2000, payable in equal monthly installments, and
continuing during the period of his full-time service hereunder; provided,
however, that the Corporation shall in good faith review the salary of the
Executive, on an annual basis, with a view to consideration of appropriate
increases in such salary. If the Executive dies during the period of his
full-time service hereunder, service for any part of the month of his death
shall be considered service for the entire month.
5. Period of service and benefits.
(a) Period of full-time service. The period of full-time service of the
Executive under this Agreement shall continue to the third anniversary of
the Effective Date, and for successive 12 month periods thereafter;
provided, however, that the Corporation may terminate at any time the
full-time service of the Executive hereunder by delivering written notice
of termination to the Executive, or the Executive may resign and terminate
his full-time service hereunder at any time after the third anniversary of
the Effective Date, by delivering written notice of his intention to resign
to the Corporation at least 3 months prior to the effective date of such
resignation.
<PAGE> 6
- 6 -
In the event of termination of the Executive by the Corporation, the
Executive shall be entitled to receive his full annual salary and fringe
benefits in effect on the date of receipt of the notice of termination for a
continuing period of 24 months beginning with that month next following the
month during which he ceases to be actively employed. In the event of the
Executive's death, the balance of the continuing salary payments shall be made
to his wife, if surviving, or if not, to his estate in addition to any and all
other benefits payable under this Agreement upon his death.
In the event of resignation by the Executive as permitted by this
Agreement, the Executive shall be entitled to receive his full annual salary
and fringe benefits in effect on the date of receipt of the notice of
resignation for a continuing period to the effective date of his resignation
but not longer than three months.
Except as otherwise provided in Section 5(c)(3), continuing fringe
benefits under this Section 5(a) shall be reduced to the extent of any fringe
benefits provided by and available to the Executive from any subsequent
employer but shall not be limited by the terms of any such fringe benefit of a
subsequent employer.
<PAGE> 7
- 7 -
In the event of termination of the Executive by the Corporation or the
Executive's death or disability, the Executive or his estate shall receive a
cash bonus for the entire fiscal year in which such termination or death occurs
or disability commences. Such bonus shall be calculated in accordance with the
management incentive compensation program of the Corporation in effect from
time to time and shall in no event be less than the full target amount for the
Executive for such fiscal year. The bonus shall be payable in one lump sum in
accordance with and at the time prescribed by the Corporation's policy for
payment of annual bonuses to its executive employees for the year in which the
Executive's termination or death occurs or his disability commences. If no
policy of the Corporation then exists with regard to calculation and payment of
bonuses, the bonus shall be calculated and paid in accordance with the policy
of the Corporation in effect as of January 1, 2000.
In addition, in the event of either termination (including, without
limitation, because of the Executive's death or disability) of employment or
resignation, the Executive shall receive payment for accrued but unused
vacation, which payment shall be equitably prorated based on the period of
active employment for that portion of the fiscal year in which the termination
or resignation becomes effective, death occurs, or disability commences, plus
payment for accrued but unused vacation for the prior fiscal year. Payment for
accrued but unused vacation shall be payable in one lump sum on the effective
date of termination or
<PAGE> 8
- 8 -
resignation, the date of death (or as soon thereafter as practicable) or the
date disability commences.
In the event of termination of the Executive by the Corporation within 24
months following an "Acquisition" of the Corporation (as hereinafter defined),
the benefits to be provided to the Executive and his beneficiaries upon such
termination, regardless of the continued effectiveness of this Agreement or of
the provisions of this Section 5(a), shall be in an amount and character not
less generous than the benefits payable upon a termination of the Executive by
the Corporation as set forth in this Section 5(a). An "Acquisition" means (I)
any transaction or series of transactions which within a 12-month period
constitute a change of management or control where (i) at least 51 percent of
the then outstanding common shares of the Corporation are (for cash, property
(including, without limitation, stock in any corporation), or indebtedness, or
any combination thereof), redeemed by the Corporation or purchased by any
person(s), firm(s) or entity(ies), or exchanged for shares in any other
corporation whether or not affiliated with the Corporation, or any combination
of such redemption, purchase or exchange, or (ii) at least 51 percent of the
Corporation's assets are purchased by any person(s), firm(s) or entity(ies)
whether or not affiliated with the Corporation for cash, property (including,
without limitation, stock in any corporation) or indebtedness or any
combination thereof, or (iii) the Corporation is merged or consolidated with
another corporation regardless of whether the
<PAGE> 9
- 9 -
Corporation is the survivor, or (II) any substantial equivalent of any such
redemption, purchase, exchange, change, transaction or series of transactions,
merger or consolidation, constituting such change of management or control.
For purposes of this paragraph, the term "control" shall have the meaning
ascribed thereto under the Securities Exchange Act of 1934, as amended, and the
regulations thereunder, and the term "management" shall mean the chief
executive officer of the Corporation. For purposes of clause (I)(ii) above or
as appropriate for purposes of clause (II) above, the Corporation shall be
deemed to include on a consolidated basis all subsidiaries and other affiliated
corporations or other entities with the same effect as if they were divisions.
The benefits provided for under this section shall be in lieu of, and not
in addition to, any and all benefits to which the Executive and his
beneficiaries may be entitled under any bonus or severance program or policy
adopted by the Corporation from time to time unless otherwise expressly stated
therein.
(b) Death benefit. If the Executive dies during the period of his
full-time service hereunder, his wife, if surviving, or if not, his estate
shall be entitled to receive his full annual salary in effect on the date of
his death for a continuing period of nine months commencing on the first day of
the month immediately following the date of his death.
(c) (1) Retirement compensation and obligations. Upon the retirement or
<PAGE> 10
- 10 -
resignation of the Executive or upon his termination from full-time service
with the Corporation, in either case pursuant to the provisions of this Section
5 hereof, the full-time service obligations of the Executive and the
Corporation to each other under Sections 2, 3 and 4 hereof shall cease,
and the Executive shall be entitled to receive benefits and compensation as
specified in this Section 5 hereof.
(2) Guarantee of pension benefits. In addition to the compensation
otherwise provided herein, the Executive and his beneficiaries shall be
entitled to receive the retirement and death benefits they would receive at the
times and under such optional arrangements as the Executive is entitled to
under the terms of any defined benefit retirement or pension plan adopted and
implemented by the Corporation for its executive office employees in effect at
the date of the Executive's retirement, resignation or termination (for
whatever reason) from full-time service with the Corporation or at any time
during the Executive's service with the Corporation (any such plan is referred
to hereafter as the "Plan") (such Plan shall include a lump sum option)
pursuant to the Plan provisions as in effect at the point in time during the
Executive's employment at which the Plan would provide the greatest benefits
for the Executive and his beneficiaries and, in addition, the greatest latitude
in choice of options (including, but not limited to, a lump sum option), but in
any event computed without reference to (i) any restrictions in the Plan upon
payments to the Executive, as described in Section 1.401(a)(4)-5(b) of the
Treasury Regulations; (ii) any restrictions in the Plan upon the maximum
contributions to
<PAGE> 11
- 11 -
the Plan or upon the maximum benefits payable under the Plan, as the case may
be, pursuant to Section 415 of the Internal Revenue Code of 1986, as in effect
at such point in time (the "Code"); (iii) any limitations on the amount of the
Executive's compensation that may be taken into account under the Plan pursuant
to Section 401(a)(17) of the Code or any successor section; (iv) the
limitations on compensation that would exclude any income attributable to the
exercise of the nonqualified stock options granted in replacement of Equity
Appreciation Rights granted under the First Restatement of the Amended and
Restated 1988 Equity Appreciation Rights Plan or the 1989 Equity Appreciation
Rights Plan (hereafter the "EAR Plans"); (v) for purposes of determining
eligibility for a lump sum distribution, any condition under the Plan
considered necessary to receive a lump sum distribution, such as the submission
of medical evidence of reasonable health of the Participant or the meeting of a
specified age or service requirement (in other words the lump sum distribution
shall be an election solely in the discretion of the Executive); or (vi) any
other restriction on the Executive's benefits as determined under the Plan
pursuant to the Code, to the Employee Retirement Income Security Act of 1974,
as in effect at such point in time ("ERISA") or to any other law affecting the
determination of such benefits. However, except as specifically described
otherwise in the preceding sentence, all calculations pursuant to this Section
5(c)(2) of benefits shall be made on the basis of the actual years of service
to the Corporation, including any Affiliated Corporation and Company as defined
under the Plan, and actual compensation of the Executive taken into account
under the applicable Plan provisions. In calculating the Executive's
compensation and years of service to the Corporation
<PAGE> 12
- 12 -
under the Plan for purposes of benefit accrual and to determine active
employment on any date relevant for any purpose under the Plan, compensation
shall be deemed to include amounts termed severance and service shall be deemed
to include the periods for which the Executive receives payments termed
severance (based on the period over which the severance amount would have been
paid if paid as compensation over the entire period as to which severance is
calculated) even if such amount is paid as a lump sum settlement. To the
extent that the benefits to which the Executive or his beneficiaries are
entitled under this Section 5(c)(2) are not paid from the Trust under the Plan
or from the IDEX Corporation Supplemental Executive Retirement Plan, the
Corporation shall pay such benefits directly from its general assets.
If payments are being made, pursuant to this Section 5(c)(2), in the form
of an annuity or other periodic form of distribution, and the portion of the
total amount to be paid from the Trust under the Plan shall thereafter be
reduced after the date such payments have been determined pursuant to the
preceding paragraph, by virtue of the operation of restrictions in the Plan
upon payments to the Executive, as described in Section 1.401(a)(4)-5(b) of the
Treasury Regulations, or by virtue of the termination of the Plan (including
the operation of Section 4045 of ERISA or any successor section) or for any
other reason other than the operation of the provisions of the optional form
selected under the Plan, the Corporation shall increase, in an amount equal to
any such reduction, the amount of the benefit under this Section 5(c)(2) which
is to be paid directly from its general assets, and such increase shall be
prorated over the remaining
<PAGE> 13
- 13 -
payments or used to recalculate the annuity payments, as the case may be.
If payments are being made or have been made in full, pursuant to this
Section 5(c)(2), but the Executive or any of his beneficiaries is required to
make a payment to the Trustee under the Plan (whether in the form of a loss of
collateral, interest on such collateral or otherwise) as the result of the
application of the restrictions in the Plan upon payments to the Executive, as
described in Section 1.401(a)(4)-5(b) of the Treasury Regulations, or by virtue
of the termination of the Plan (including the operation of Section 4045 of
ERISA or any successor section) or for any other reason, the Corporation shall
reimburse the Executive or his beneficiaries, as the case may be, directly from
its general assets, for each such payment to the Trustee, and if the Executive
or any of his beneficiaries does not receive a deduction for federal, state
and/or local income tax purposes for such a payment and/or if such payment
would result in the imposition of any penalty tax because of such repayment,
then the amount of such reimbursement shall be increased by an amount such that
after payment by the Executive or his beneficiaries of all taxes, including,
without limitation, any interest or penalties imposed with respect to such
reimbursement, the Executive or his beneficiaries retain an amount from the
Corporation approximately equal to the amount repaid to the Trustee.
<PAGE> 14
- 14 -
In the event (I) the Executive requests a lump sum distribution from the
Trustee or Committee under the Plan and is denied the request, regardless of
the reason for the denial, or (II) (i) if the Plan is amended to eliminate the
lump sum distribution option on future benefit accruals or (ii) the Executive
is not otherwise entitled to a lump sum distribution under the Plan terms and,
in the case of (i) or (ii), the Executive states in writing to the Corporation
at any time prior to the Executive or his beneficiaries receiving a benefit
under the Plan that he otherwise would have requested the lump sum distribution
option, the Corporation shall pay the Executive, or his beneficiaries, as the
case may be, in cash in a single lump sum benefit, an amount equal to the
benefit hereinbefore determined less any amount received by the Executive or
his beneficiaries from the Plan directly or indirectly in a single payment,
regardless of the form of payment in which the benefit is being paid or is to
be paid under the Plan. In the case of a benefit provided under this
paragraph, the Corporation shall pay the Executive or his beneficiaries an
additional amount in cash in a single lump sum payment such that after payment
by the Executive or his beneficiaries of all federal, state, and/or local
income taxes (including, without limitation, any interest or penalties imposed
with respect to such taxes) imposed upon such single lump sum payment, the
Executive or his beneficiaries retain an amount that would have been retained
by him or them (without regard to any limitations as described in the first
paragraph of this Section 5(c)(2)) had he or they directly rolled the amount
from the Plan into an individual retirement account. If the Executive or his
beneficiaries receive the single lump sum payment from the Corporation under
this paragraph, the Executive and his beneficiaries agree to
<PAGE> 15
- 15 -
waive and/or return to the Corporation all benefits to him or them that he or
they subsequently receive from the Plan. Notwithstanding the preceding
sentence, if the Executive or any of his beneficiaries does not receive a
deduction for federal, state and/or local income tax purposes for such benefits
and/or if such benefits would result in the imposition of any penalty tax
because of such repayment, then the amount of such waiver and/or return to the
Corporation shall be decreased by an amount such that after payment by the
Executive or his beneficiaries of all taxes, including, without limitation, any
interest or penalties imposed with respect to such waiver and/or return, the
Executive or his beneficiaries incur no net expense from such benefits he or
they subsequently receive from the Plan. For purposes of this Section,
beneficiaries means the beneficiaries as determined under the Plan.
Notwithstanding the preceding provisions of this Section 5(c)(2), in
calculating the benefit provided under this Section 5(c)(2) under the terms of
any Plan, compensation shall include in any year any amount otherwise excluded
from compensation in such year as a result of an election to defer income made
pursuant to the provisions of the IDEX Corporation 1996 Deferred Compensation
Plan for Officers and shall exclude in any year any amount that would otherwise
be included in compensation in a year which relates to an amount deferred in a
prior year under the provisions of the IDEX Corporation 1996 Deferred
Compensation Plan for Officers.
Notwithstanding the preceding provisions of this Section 5(c)(2), in
calculating the
<PAGE> 16
- 16 -
benefit provided under this Section 5(c)(2) under the terms of the Plan, the
following rules shall apply:
(a) In computing average compensation for purposes of any benefit
formula under the Plan, compensation shall not include any income
includable in the Executive's income for income tax purposes attributable
to the exercise of stock options granted in replacement for Equity
Appreciation Rights under the EAR Plans at any time.
(b) An additional benefit under this Section 5(c)(2) shall be payable
in an amount equal to the benefit accrued at the rate provided in the
Plan's career average formula applied to the income includable in the
Executive's income for income tax purposes attributable to the exercise of
stock options granted in replacement of Equity Appreciation Rights under
the EAR Plans at any time.
(3) Medical benefits. The Executive and/or his wife, as the case may be,
shall be entitled to prompt reimbursement for all medical, dental,
hospitalization, convalescent, nursing, extended care facilities (including,
without limitation, long term care facilities such as convalescent and nursing
homes) and similar health and welfare expenses incurred by the Executive (or by
his wife in the event of the Executive's death or disability) for the Executive
or for the benefit of his wife or other dependents (hereinafter collectively
referred to as "medical benefits"). Such medical benefits shall continue at
all times while the Executive is employed by
<PAGE> 17
- 17 -
the Corporation, and thereafter for the remainder of his life or the life of
his wife, whichever shall be the longer time, if (a) the Executive continues in
the employ of the Corporation until the commencement of his 56th year, or (b)
the Executive prior to the commencement of his 56th year dies or becomes
disabled while employed by the Corporation, or (c) the Executive incurs a
"Termination of Service," which entitles him to receive "Severance Benefits,"
both terms as defined within the meaning of the Severance Agreement between the
Corporation and the Executive dated December 3, 1999, if the Termination of
Service occurs within the two (2) year period preceding the commencement of his
56th year, or (d) the Executive ceases to be employed by the Corporation for
any reason, whether voluntary or involuntary, at any time following an
Acquisition. The Corporation may, in its discretion, insure such medical
benefits; provided, however, that such benefits shall not be affected by the
existence or non-existence of any available insurance from any source, shall
not be limited by the terms of any such insurance or the failure of any insurer
to meet its obligations thereunder, shall not limit the Executive or his wife
or other dependents in the choice of any physician, medical care facility or
type of medical expenses in any way, and, except as provided in the following
sentence, shall not be affected by the availability of any medical benefits
provided by and available to the Executive from any subsequent employer. Such
medical benefits shall be reduced to the extent of any medical benefits
actually available and actually provided by any subsequent employer to the
Executive, his wife, or other dependents only during the following periods:
<PAGE> 18
- 18 -
(a) until the commencement of his 56th year if he ceases to be
employed by the Corporation as a result of his involuntary termination
following an Acquisition, or
(b) until the commencement of his 60th year if he ceases to be
employed by the Corporation as a result of his voluntary termination or
retirement prior to the commencement of his 60th year.
Without limiting the foregoing, there shall be no such offset in the event of:
(a) termination for any reason after commencement of the Executive's
60th year,
(b) involuntary termination following an Acquisition, and after
commencement of the Executive's 56th year, or
(c) the death or disability of the Executive while in the active
employment of the Corporation.
In any case such reduction in medical benefits shall be only to the extent of
any medical benefits actually provided by and actually available to the
Executive (and/or his wife or other dependents)
<PAGE> 19
- 19 -
from any subsequent employer without cost to the Executive (and/or his wife or
other dependents) or subject to full reimbursement of any such cost by the
Corporation to the Executive (and/or his wife or other dependents), but shall
not be limited by the terms of any such insurance or reimbursement. For
purposes of this Agreement, the term "medical expenses" shall include, but not
be limited to, prescription drugs, prosthetics, optical care (including
corrective lenses) and travel and lodging associated with medical expenses,
with the selection of medical providers and institutions and related travel and
lodging to be solely in the discretion of the Executive (and/or his wife or
other dependents).
(d) Confidentiality agreement. During the course of his employment, the
Executive has had and will have access to confidential information relating to
the lines of business of the corporation, its trade secrets, marketing
techniques, technical and cost data, information concerning customers and
suppliers, information relating to product lines, and other valuable and
confidential information relating to the business operations of the Corporation
not generally available to the public (the "Confidential Information"). The
parties hereby acknowledge that any unauthorized disclosure or misuse of the
Confidential information could cause irreparable damage to the Corporation.
The parties also agree that covenants by the Executive not to make unauthorized
use or disclosures of the Confidential Information are essential to the growth
and stability of the business of the Corporation. Accordingly, the
<PAGE> 20
- 20 -
Executive agrees to the confidentiality covenants set forth in this section.
The Executive agrees that, except as required by his duties with the
Corporation or as authorized by the Corporation in writing, he will not use or
disclose to anyone at any time, regardless of whether before or after the
Executive ceases to be employed by the Corporation, any of the Confidential
Information obtained by him in the course of his employment with the
Corporation.
The Executive agrees that since irreparable damage could result from his
breach of the covenants in this Section 5(d) of this Agreement, in addition to
any and all other remedies available to the Corporation, the Corporation shall
have the remedies of a restraining order, injunction or other equitable relief
to enforce the provisions thereof. The Employee consents to jurisdiction in
Lake County, Illinois on the date of the commencement of any action for
purposes of any claims under this Section 5(d). In addition, the Executive
agrees that the issues in any action brought under this section will be limited
to claims under this section, and all other claims or counterclaims under other
provisions of this Agreement will be excluded.
6. Compensation under this Agreement not exclusive. Except as expressly
stated to the contrary in this Agreement, the compensation and benefits payable
by the
<PAGE> 21
- 21 -
Corporation to the Executive under the provisions of this Agreement shall be in
addition to and separate and apart from such additional compensation or
incentives and such retirement, disability or other benefits as the Executive
may be entitled to under any present or future extra compensation or bonus
plan, stock option plan, share purchase agreement, pension plan, disability
insurance plan, medical insurance plan, life insurance program, or other plan
or arrangement of the Corporation established for its executives or employees,
and the provisions of this Agreement shall not affect any such compensation,
incentives or benefits. The Board of Directors of the Corporation, in its
discretion, may award the Executive such additional compensation, incentives or
benefits, pursuant to such plans or otherwise, as it may from time to time
determine.
7. Termination of this Agreement. This Agreement shall terminate when the
Corporation has made the last payment provided for hereunder; provided,
however, that the obligations set forth under Section 5(d) of this Agreement
shall survive any such termination and shall remain in full force and effect.
Without the written consent of the Executive, the Corporation shall have no
right to terminate this Agreement prior thereto. In the event the Executive,
or his beneficiaries, as the case may be, and the Corporation shall disagree as
to their respective rights and obligations under this Agreement, and the
Executive or his beneficiaries are successful in establishing, privately or
otherwise, that his or their position is substantially correct, or that the
<PAGE> 22
- 22 -
Corporation's position is substantially wrong or unreasonable, or in the event
that the disagreement is resolved by settlement, the Corporation shall pay all
costs and expenses, including counsel fees, which the Executive or his
beneficiaries may incur in connection therewith directly to the provider of the
services or as may otherwise be directed by the Executive or his beneficiaries.
The Corporation shall not delay or reduce the amount of any payment provided
for hereunder or setoff or counterclaim against any such amount for any reason
whatever; it is the intention of the Corporation and the Executive that the
amounts payable to the Executive or his beneficiaries hereunder shall continue
to be paid in all events in the manner and at the times herein provided. All
payments made by the Corporation hereunder shall be final and the Corporation
shall not seek to recover all or any part of any such payments for any reason
whatsoever.
8. Additional payments by Corporation.
(a) Notwithstanding anything in this Agreement or any other agreement to
the contrary, in the event it shall be determined that any payment or
distribution by the Corporation or any affiliate (as defined under the
Securities Act of 1933, as amended, and the regulations thereunder) thereof or
any other person to or for the benefit of the Executive, whether paid or
<PAGE> 23
- 23 -
payable or distributed or distributable pursuant to the terms of this
Agreement, pursuant to that certain shareholder purchase and/or sale agreement
between Executive and the Corporation made as of January 22, 1988, as amended
and restated, pursuant to all non-qualified stock option plans of the
Corporation now or hereafter in effect, pursuant to the IDEX Corporation
Supplemental Executive Retirement Plan, pursuant to the IDEX Corporation 1996
Deferred Compensation Plan for Officers, any other plan of deferred
compensation, or pursuant to any other agreement or arrangement with the
Corporation or any affiliate thereof now or hereafter in effect (a "Payment"),
would be subject to the excise tax imposed by Section 4999 of the Code, or any
successor statute thereto, or any interest or penalties with respect to such
excise tax (such excise tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise Tax"), then the Executive
shall be entitled to receive an additional payment (a "Gross-Up Payment") in an
amount such that after payment by the Executive of all taxes (including,
without limitation, any interest or penalties imposed with respect to such
taxes and any Excise Tax) imposed upon the Gross-Up Payment, the Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon
the Payments.
(b) The Executive and/or the Corporation shall notify each other in
writing as soon as practicable of any claim by the Internal Revenue Service
that, if successful, would require the payment by the Corporation of the
Gross-Up Payment. Such notification shall state
<PAGE> 24
- 24 -
the nature of such claim and the date on which such claim is requested to be
paid. Neither the Executive nor the Corporation shall pay such claim for taxes
prior to the expiration of the thirty-day period following the date on which
the notice is given (or such shorter period ending on the date that any payment
of taxes with respect to such claim is due). If the Executive or Corporation
(hereafter the "Notifying Party") notifies the other party in writing prior to
the expiration of such period that it desires to contest such claim, such other
party shall take such action, in connection with contesting such claim as the
Notifying Party shall reasonably request in writing from time to time,
including, without limitation, accepting legal representation with respect to
such claim by an attorney selected by the Notifying Party and approved by the
other party, provided, however, that the Corporation shall bear and pay
directly all costs and expenses (including additional interest and penalties
and counsel fees as submitted) incurred in connection with such contest and
shall indemnify and hold the Executive harmless, on an after-tax basis, for any
Excise Tax or income tax, including interest and penalties with respect
thereto, imposed as a result of such representation and payment of costs and
expenses. Furthermore, if the Corporation is the Notifying Party, the
Corporation's control of the contest shall be limited to issues with respect to
which a Gross-Up Payment would be payable hereunder and the Executive shall be
entitled to settle or contest, as the case may be, any other issue raised by
the Internal Revenue Service or any other taxing authority.
<PAGE> 25
- 25 -
9. Assurances on liquidation. The Corporation agrees that until the
termination of this Agreement as above provided, it will not voluntarily
liquidate or dissolve, or enter into or be a party to any other transaction the
effect of which would be to materially reduce the net assets or operations of
the Corporation, without first making a written agreement with the Executive or
other beneficiary, satisfactory to and approved by him or such beneficiary in
writing within 30 days of receipt of a notice from the Corporation of such
proposed liquidation, dissolution or other transaction, in fulfillment of or in
lieu of its obligations to him or such beneficiary under this Agreement or any
other agreement, plan, policy or program of the Corporation or, in the absence
of such agreement, paying him or such beneficiary in a lump sum settlement of
all such obligations prior to such proposed liquidation, dissolution or other
transaction. Notwithstanding anything in the preceding sentence to the
contrary, in the event that pursuant to the preceding sentence the Corporation
is obligated to pay to the Executive or such beneficiary in a lump sum
settlement all of the obligations of the Corporation to the Executive or such
beneficiary under this Agreement or any other agreement, plan, policy or
program of the Corporation, the Executive or, in the event of his death or
inability to act, his wife or, if not surviving, his eldest surviving child (or
in the event of their inability to act, such person who has the legal power to
act on their behalf), shall have the right, in his or her sole discretion, to
elect not to receive a lump sum settlement of the obligations of the
Corporation to the Executive or other beneficiary under Section 5(c)(3) of
this Agreement and, in lieu thereof, to receive a guaranty (including, without
limitation, a letter of credit), in form and substance satisfactory to the
<PAGE> 26
- 26 -
Executive or other beneficiary, as the case may be, in his or her sole
discretion, of the payment of such obligations from any entity satisfactory to
the Executive or other beneficiary, as the case may be, in his or her sole
discretion. Any lump sum settlement shall reflect a reasonable assumption of
cost-of-living adjustments, if appropriate to such obligation, and shall be
determined using the mortality assumptions of the "applicable mortality table"
under Section 417(e) of the Code and either (i) the interest rate that would be
used (as of the date of payment) by the Pension Benefit Guaranty Corporation
for purposes of valuing a lump sum distribution upon a plan termination on the
January 1 of the calendar year in which the single sum is paid or (ii) the
"applicable interest rate" under Section 417(e) of the Code, determined as of
the first month of the calendar year in which the single sum is paid, whichever
would produce the greater single sum amount. For purposes of this Subsection,
the Corporation shall be deemed to include on a consolidated basis all
subsidiaries and other affiliated corporations or other entities with the same
effect as if they were divisions.
10. Definitions. For purposes of this Agreement, the term "year" shall
mean fiscal year, the term "dependents" shall have the same meaning as pursuant
to Section 152 of the Code and the terms "his 56th year" and "his 60th year"
shall mean immediately following the Executive's 55th birthday and 59th
birthday respectively. For purposes of this Agreement, disability shall mean a
disability which is, or has the potential to be, total and permanent and
<PAGE> 27
- 27 -
because of which the Executive is or may become physically or mentally unable
to substantially perform his regular duties as an Executive of the Corporation.
Any question as to the existence, extent or potentiality of disability of the
Executive upon which the Executive and the Corporation cannot agree shall be
determined by a qualified independent physician selected by the Executive and
reasonably acceptable to the Corporation (or, if the Executive is unable to
make such selection, it shall be made by any adult member of his immediate
family). The determination of such physician made in writing to the
Corporation and to the Executive shall be final and conclusive for all purposes
of this Agreement.
11. Amendments. This Agreement may not be amended or modified orally, and
no provision hereof may be waived, except in a writing signed by the parties
hereto, and specifically the agreement of any beneficiary, wife, dependents or
other potential or actual third party beneficiary shall not be required, except
as specifically provided for in this Agreement.
12. Assignment. This Agreement cannot be assigned by either party hereto
except with the written consent of the other.
13. Binding effect. This Agreement shall be binding upon and inure to the
benefit of the personal representatives and successors in interest of the
Executive and any
<PAGE> 28
- 28 -
successors in interest of the Corporation. In addition to inuring to the
benefit of the Executive, Sections 5(a) and 5(b) are intended to inure to the
benefit of the Executive's beneficiaries, Section 5(c)(2) is intended to inure
to the benefit of the Executive's beneficiaries, to the extent contemplated in
that provision, Section 5(c)(3) is intended to inure to the benefit of the
Executive's wife and his dependents, and Section 7, Section 8 and Section 9 are
intended to inure to the benefit of the Executive's beneficiaries; such
provisions shall be enforceable by the aforesaid beneficiaries, wife and/or
dependents, as the case may be, who upon the Executive's death shall be deemed
successors in interest.
14. Choice of law. This Agreement shall be governed by the law of the
State of Illinois (excluding the law of the State of Illinois with regard to
conflicts of law) as to all matters, including but not limited to matters of
validity, construction, effect and performance.
15. Notice. Except as otherwise provided in this Agreement, all notices
and other communications given pursuant to this Agreement shall be deemed to
have been properly given if personally delivered or mailed, addressed to the
appropriate party at the address of such party as shown at the beginning of
this Agreement, postage prepaid, by certified mail or by Federal Express or
similar overnight courier service. A copy of any notice sent pursuant to this
section shall also be sent to Hodgson, Russ, Andrews, Woods & Goodyear, 1800
One M&T Plaza, Buffalo, New York, 14203, Attention: Richard E. Heath, Esq. and
Dianne Bennett, Esq.
<PAGE> 29
- 29 -
Any party may from time to time designate by written notice given in accordance
with the provisions of this paragraph any other address or party to which such
notice or communication or copies thereof shall be sent.
16. Severability of provisions. In case any one or more of the provisions
contained in this Agreement shall be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be effected or impaired thereby and this
Agreement shall be interpreted as if such invalid, illegal or unenforceable
provision was not contained herein.
17. Titles. Titles are provided herein for convenience only and are not
to serve as a basis for interpretation or construction of this Agreement.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the Executive has hereunto set his hand and the
<PAGE> 30
- 30 -
Corporation has caused this Agreement to be executed in its name and on its
behalf as of the date first above written.
/s/ Wayne P. Sayatovic
DATE OF EXECUTION: March 31, 2000
IDEX CORPORATION
/s/ Frank J. Hansen
President
DATE OF EXECUTION: March 31, 2000
The undersigned hereby executes this Amendment to evidence her agreement
to be bound by the terms of Subsection 5(c)(2) of the Employment Agreement.
/s/ Janice Z. Sayatovic
DATE OF EXECUTION: March 31, 2000
<PAGE> 1
Exhibit 10.3
March 15, 2000
PERSONAL AND CONFIDENTIAL
Mr. Wayne P. Sayatovic
91 West Mallard Lane
Lake Forest, Illinois 60045
Dear Wayne:
Re: Severance Agreement
This letter serves as an amendment of the Severance Agreement between IDEX
Corporation and you dated December 3, 1999 which you accepted on December 21,
1999. Pursuant to this amendment, Item 9 of the enumerated Severance Benefits
is eliminated and replaced with the following:
9) All stock options previously granted to you will immediately vest and
you will have until the earlier of (i) ten (10) years from date of
grant of the option or (ii) thirty-six (36) months following the last
day of employment to exercise the options you hold.
All other terms of the Severance Agreement remain unchanged. Please
acknowledge your acceptance of this amendment by signing and returning the
enclosed copy of this letter.
Very truly yours,
/s/ Frank J. Hansen
FJH:mtm
Enclosure
Agreed to and accepted by:
/s/ Wayne P. Sayatovic
Date: March 31, 2000
<PAGE> 1
Exhibit 10.4
March 15, 2000
PERSONAL AND CONFIDENTIAL
Mr. James R. Fluharty
308 Camelot Lane
Libertyville, Illinois 60048
Dear Jim:
Re: Severance Agreement
This letter serves as an amendment of the Severance Agreement between IDEX
Corporation and you dated December 3, 1999 which you accepted on December 6,
1999. Pursuant to this amendment, Item 9 of the enumerated Severance Benefits
is eliminated and replaced with the following:
9) All stock options previously granted to you will immediately vest and
you will have until the earlier of (i) ten (10) years from date of
grant of the option or (ii) thirty-six (36) months following the last
day of employment to exercise the options you hold.
All other terms of the Severance Agreement remain unchanged. Please
acknowledge your acceptance of this amendment by signing and returning the
enclosed copy of this letter.
Very truly yours,
/s/ Frank J. Hansen
FJH:mtm
Enclosure
Agreed to and accepted by:
/s/ James R. Fluharty
Date: March 31, 2000
<PAGE> 1
Exhibit 10.5
March 15, 2000
PERSONAL AND CONFIDENTIAL
Mr. Rodney L. Usher
2 Neuchatel Lane
Fairport, New York 14450
Dear Rod:
Re: Severance Agreement
This letter serves as an amendment of the Severance Agreement between IDEX
Corporation and you dated December 3, 1999 which you accepted on December 6,
1999. Pursuant to this amendment, Item 9 of the enumerated Severance Benefits
is eliminated and replaced with the following:
9) All stock options previously granted to you will immediately vest and
you will have until the earlier of (i) ten (10) years from date of
grant of the option or (ii) thirty-six (36) months following the last
day of employment to exercise the options you hold.
All other terms of the Severance Agreement remain unchanged. Please
acknowledge your acceptance of this amendment by signing and returning the
enclosed copy of this letter.
Very truly yours,
/s/ Frank J. Hansen
FJH:mtm
Enclosure
Agreed to and accepted by:
/s/ Rodney L. Usher
Date: March 15, 2000
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 4,414
<SECURITIES> 0
<RECEIVABLES> 108,266
<ALLOWANCES> 2,897
<INVENTORY> 106,138
<CURRENT-ASSETS> 222,748
<PP&E> 275,675
<DEPRECIATION> 148,314
<TOTAL-ASSETS> 739,038
<CURRENT-LIABILITIES> 100,605
<BONDS> 249,081
0
0
<COMMON> 297
<OTHER-SE> 340,246
<TOTAL-LIABILITY-AND-EQUITY> 739,038
<SALES> 176,662
<TOTAL-REVENUES> 176,662
<CGS> 106,107
<TOTAL-COSTS> 146,530
<OTHER-EXPENSES> 499
<LOSS-PROVISION> 169
<INTEREST-EXPENSE> 4,164
<INCOME-PRETAX> 25,300
<INCOME-TAX> 9,487
<INCOME-CONTINUING> 15,813
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 15,813
<EPS-BASIC> 0.53
<EPS-DILUTED> 0.52
</TABLE>
