-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MHDpxrzpnpUu1FpN4WVglxqTB/GjC7TOZHKE0sgk6bAoVdzQ1cUlSQB6QDgoKZvT Z+A1HKaVHVsnHjFPKCdluQ== 0000928385-01-500160.txt : 20010330 0000928385-01-500160.hdr.sgml : 20010330 ACCESSION NUMBER: 0000928385-01-500160 CONFORMED SUBMISSION TYPE: 10-K405 PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20001231 FILED AS OF DATE: 20010329 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DANAHER CORP /DE/ CENTRAL INDEX KEY: 0000313616 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL INSTRUMENTS FOR MEASUREMENT, DISPLAY, AND CONTROL [3823] IRS NUMBER: 591995548 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K405 SEC ACT: SEC FILE NUMBER: 001-08089 FILM NUMBER: 1584455 BUSINESS ADDRESS: STREET 1: 1250 24TH ST NW STREET 2: SUITE 800 CITY: WASHINGTON STATE: DC ZIP: 20037 BUSINESS PHONE: 2028280850 MAIL ADDRESS: STREET 1: 1250 24TH STREET NW STREET 2: SUITE 800 CITY: WASHINGTON STATE: DC ZIP: 20037 FORMER COMPANY: FORMER CONFORMED NAME: DMG INC DATE OF NAME CHANGE: 19850221 10-K405 1 d10k405.txt FORM 10-K405 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) [ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 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: 1-8089 ------ DANAHER CORPORATION (Exact name of registrant as specified in its charter) Delaware 59-1995548 -------- ---------- (State of incorporation) (I.R.S.Employer Identification number) 1250 24th Street, N.W., Suite 800 Washington, D.C. 20037 ---------------- ----- (Address of Principal (Zip Code) Executive Offices) Registrant's telephone number, including area code: 202-828-0850 Securities Registered Pursuant to Section 12(b) of the Act: Name of Exchanges Title of each class on which registered ------------------- ------------------- Common Stock $.01 par Value New York Stock Exchange, Inc. Pacific Stock Exchange, Inc. Securities registered pursuant to Section 12(g) of the Act: NONE (Title of Class) 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 and (2) has been subject to such filing requirements for the past 90 days. Yes X No __ --- Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] As of March 22, 2001, the number of shares of common stock outstanding was 142.5 million and were held by approximately 3,200 holders. The aggregate market value of common shares held by non-affiliates of the Registrant on such date was approximately $7.8 billion, based upon the closing price of the Company's common shares as quoted on the New York Stock Exchange composite tape on such date. 1 EXHIBIT INDEX APPEARS ON PAGE 14 2 DOCUMENTS INCORPORATED BY REFERENCE Part II and Part IV incorporate certain information by reference from the registrant's Annual Report to Shareholders for the year ended December 31, 2000. With the exception of the pages of the Annual Report to Shareholders specifically incorporated herein by reference, the Annual Report to Shareholders is not deemed to be filed as part of this Form 10-K. Part III incorporates certain information by reference from the registrant's proxy statement for its 2001 annual meeting of stockholders. With the exception of the pages of the 2001 Proxy Statement specifically incorporated herein by reference, the 2001 Proxy Statement is not deemed to be filed as part of this Form 10-K. Certain information included or incorporated by reference in this document may be deemed to be "forward looking statements" within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. All statements, other than statements of historical facts, that address activities, events or developments that the Company intends, expects, projects, believes or anticipates will or may occur in the future are forward looking statements. Such statements are characterized by terminology such as "believe," "anticipate," "should," "intend," "plan," "will," "expects," "estimates," "projects," "positioned," "strategy," and similar expressions. These statements are based on assumptions and assessments made by the Company management in light of its experience and its perception of historical trends, current conditions, expected future developments and other factors it believes to be appropriate. These forward looking statements are subject to a number of risks and uncertainties, including but not limited to continuation of the Company's longstanding relationship with major customers, the Company's ability to integrate acquired businesses into its operations and realize planned synergies, the extent to which acquired businesses are able to meet the Company's expectations and operate profitably, changes in regulations (particularly environmental regulations) which could affect demand for products in the Process/Environmental Controls segment and unanticipated developments that could occur with respect to contingencies such as environmental matters and litigation. In addition, the Company is subject to risks and uncertainties that affect the manufacturing sector generally including, but not limited to, economic, competitive, governmental and technological factors affecting the Company's operations, markets, products, services and prices. Any such forward looking statements are not guarantees of future performances and actual results, developments and business decisions may differ from those 3 envisaged by such forward looking statements. The Company disclaims any duty to update any forward looking statements, all of which are expressly qualified by the foregoing. ITEM 1. BUSINESS - ----------------- The Company conducts its operations through two business segments: Process/Environmental Controls and Tools and Components. Process/Environmental Controls - ------------------------------ The Process/Environmental Controls Segment is comprised of Hach Company, the Dr. Bruno Lange Group, McCrometer, Fluke Corporation, Fluke Networks, Veeder-Root Company, the Danaher Industrial Controls Group, the Danaher Motion Control Group (including the General Purpose Systems Division, the Motion Components Division and the Special Purpose Systems Division), the controls business units of Joslyn Corporation and Pacific Scientific, M&M Precision Systems, Cyberex, Current Technology, United Power Corporation, QualiTROL Corporation, Gems Sensors, Kollmorgen Artus, and Kollmorgen Electro-Optical. These companies produce and sell compact, professional electronic test tools; underground storage tank leak detection systems; motion, position, speed, temperature and level instruments and sensing devices; power switches and controls; communication line products; power protection products; liquid flow and quality measuring devices; quality assurance products and systems; safety devices; and electronic and mechanical counting and controlling devices. These products are distributed by the Company's sales personnel and independent representatives to original equipment manufacturers, distributors and other end- users. The largest product line in the Process/Environmental Control Segment is precision motion control, which includes the following operations: Pacific Scientific, Kollmorgen Industrial and Commercial, American Precision Industries, Warner Electric and Inmotion Technologies. The primary motion control product lines include motors, drives, controls and mechanical components generally used in a variety of motion applications including but not limited to robotics, packaging equipment and electric vehicles. The Company's strategy has been to focus on precision motion control applications providing significant value through system solutions tailored to individual motion control needs. Channels to market include a direct sales force as well as a network of distributors and representatives located primarily throughout Europe and North America. The Company has built a leadership position in precision 4 motion control through several recent acquisitions. Beginning in late 1999, Atlas Copco Controls (later renamed Inmotion Technologies) was acquired. This largely European supplier of complete servo motor, drive and control solutions provides both a European presence and a well recognized high-volume design and manufacturing capability. The acquisition of American Precision Industries in March 2000 brought a diversified U.S. and European motion control supplier that expanded the system scope of the Company. The subsequent acquisition of Kollmorgen in June 2000 provided specialized servo and stepper motor systems to general industrial, medical and aerospace applications. Kollmorgen also has significant operations in Europe and Asia. Kollmorgen's patented "Direct Drive" technology allows for rapid replacement of mechanical and hydraulic systems, eliminating the inefficiency, expense and complexity of gearing systems. In July 2000, the motion control businesses of Warner Electric Company, a leading provider of linear positioning equipment and unique motor solutions in both the U.S. and Europe were also added to the group. The Company's electronic test operations were added through the acquisition of Fluke Corporation in July 1998 and were supplemented by several smaller acquisitions since 1998. Fluke is engaged in the design, manufacture and marketing of compact, professional electronic test tools. Fluke's principal products are portable instruments that measure voltage, current, power quality, frequency, temperature, pressure and other key functional parameters of electronic equipment. Fluke Networks, which was separated from Fluke during 2000 as a stand-alone business unit, provides software and hardware products needed for the installation, monitoring and maintenance of local and wide area networks and the underlying fiber and copper cable infrastructure. In its environmental product lines, the Company has a leadership position in the water quality testing and control market, into which is sold its Hach, Dr. Lange, Pacific Scientific, and Sigma branded products. These products include analytical instruments used in water quality monitoring, and chemicals and other consumables used in the process. The Company markets these products worldwide, both direct to end users and through distributors. Another key environmental product is the Veeder-Root storage tank leak detection system. Veeder-Root is the premier manufacturer of state-of-the-art tank monitoring and leak detection systems for underground fuel storage tanks. Veeder-Root also offers remote monitoring services for its installed systems. The Company's power quality product lines include Cyberex, 5 United Power, Current Technologies, Joslyn Hi-Voltage, Fisher Pierce, QualiTROL, M&M Precision, Sonix and Jennings Technology. Cyberex, United Power and Current Technologies design and manufacture products that provide high quality and reliable power within the infrastructures serving the internet, telecom and traditional data center markets. Primary products include static digital transfer switches, power distribution units, and transient voltage surge suppressors. United Power was acquired in January 2001. Joslyn Hi-Voltage designs and manufactures high voltage switches and advanced electronic controls on a worldwide basis to the utility industry. QualiTROL designs and manufactures automated protection and control equipment used globally in electric transmission and distribution systems. The safety and aviation product lines provide safety equipment, submarine periscopes and generator and motion related products. Pacific Scientific Company designs and manufactures equipment used mainly for fire detection and suppression, crew restraints, flight control and energetic devices. Worldwide sales, service and repair of its products are provided for airlines and other users of safety equipment. The Electro-Optical Division acquired with Kollmorgen has been the primary supplier of submarine periscopes to the United States Navy and also markets and sells submarine periscopes to navies throughout the world. The Italian Electro-Optical subsidiary, Calzoni S.p.A., designs and manufactures proprietary motion systems and components worldwide, in addition to submarine masts. Kollmorgen Artus, a French subsidiary, manufactures and sells generators, special motors, electro-mechanical actuators and drive electronics which are sold worldwide to the aerospace and defense markets. Kollmorgen Artus also manufactures and sells calibration systems for air traffic control navigation aids. The Company's industrial control operations include products and systems that measure and control parameters including temperature, level, position, quantity and time. These products are manufactured and marketed by the Danaher Industrial Controls Group and Gems Sensors primarily in North America and Europe. The raw materials utilized by companies in this segment are stock items, principally metals and plastic, electrical and electronic components. These materials are readily available from a number of sources in sufficient quantities. Tools and Components - -------------------- The Tools and Components segment is comprised of the Danaher Hand Tool Group (including Special Markets, Professional Tool Division and Asian Tool Division), Matco Tools ("Matco"), Jacobs Chuck Manufacturing Company 6 ("Jacobs"), Delta Consolidated Industries ("Delta"), Jacobs Vehicle Systems Company, Hennessy Industries and the hardware and electrical apparatus lines of Joslyn Manufacturing Company (JMC). This segment is one of the largest worldwide producers and distributors of general purpose mechanics' hand tools and automotive specialty tools. Other products manufactured by these companies include tool boxes and storage devices, diesel engine retarders, wheel service equipment, drill chucks, custom designed headed tools and components, hardware and components for the power generation and transmission industries, high quality precision socket screws, fasteners, and high quality miniature precision parts. The Company's business strategy in this segment is focused on increasing sales to existing customers, broadening channels of distribution, developing new products, geographic expansion and achieving production efficiencies and enhanced quality and customer service. Danaher Tool Group (DTG) is one of the largest worldwide producers of general purpose mechanics' hand tools (primarily ratchets, sockets and wrenches) and specialized automotive service tools for the professional and "do-it- yourself" markets. DTG has been the principal manufacturer of Sears, Roebuck and Co.'s Craftsman(R) line of mechanics' hand tools for over 60 years. DTG's Special Markets Group sells to Sears under a five year evergreen agreement, that requires Sears to purchase a significant portion of its annual requirements for its private-label Craftsman mechanics' hand tool line from DTG, subject to certain conditions. For over 30 years, DTG has also been a primary supplier of specialized automotive service tools to NAPA, which has over 6,000 outlets. In addition, DTG has been the designated supplier of general purpose mechanics' hand tools to NAPA since 1983. DTG specialized automotive service tools are also sold under the K-D Tools(R) brand, its industrial tools and products are also sold under the Armstrong(R) and Allen(TM) brand names, and fastener products under the Holo-Krome(R) name are sold to independent distributors and other customers in the "do-it-yourself," professional automotive, commercial and industrial markets. Professional mechanics' tools are distributed by Matco which has approximately 1,400 independent mobile distributors who sell primarily to individual professional mechanics. Matco is one of the leading suppliers in this market. 7 Jacobs(R) is the market leader in the drill chuck business with its highly respected and well recognized brand name. Delta is a leading manufacturer of pickup truck toolboxes and industrial storage boxes and its products are sold under the DELTA(R) and JOBOX(R) brand names. Wheel service equipment is manufactured under the Coats(R), Bada(R) and Ammco(R) brand names. Products include tire changers, wheel balancers, wheel weights and brake service equipment. Wheel service equipment is sold primarily to wholesale distributors and national accounts. These markets are served by the Company's sales personnel. Diesel engine retarders are manufactured at Jacobs Vehicle Systems Company. The "Jake Brake(R)" technology was developed by Jacobs Vehicle and represents the leading brand of engine retarders. The product is sold by Jacobs' sales personnel to original equipment manufacturers and aftermarket distributors. JMC manufactures a wide variety of products used in the construction and maintenance of electric power, telephone and cable television systems. Its products range from specialized fasteners to sophisticated castings and forgings. JMC also manufactures surge protection devices for the electric power utility industry. The major raw materials used by this segment, including high quality steel, are available from a variety of sources in sufficient quantities. Patents, Licenses, etc. - ----------------------- The Company has patents of its own and has acquired licenses under patents of others. The Company does not consider that its business, as a whole, is dependent on any single patent, group of patents, trademark or franchise. The Company does, however, offer many patented products and is periodically engaged in litigation concerning patents and licenses. Seasonal Nature of Business - --------------------------- As a whole, the Company's businesses are not subject to material seasonal fluctuations. Backlog - ------- The Company's products are manufactured primarily in advance of order and either shipped or assembled from stock. Backlogs are not significant as sales 8 are often dependent on orders requiring immediate shipment from inventory. Employee Relations - ------------------ At December 31, 2000, the Company employed approximately 24,000 persons. Of these, approximately 2,400 were hourly-rated unionized employees. The Company considers its labor relations to be good. Research and Development - ------------------------ The Company's research and development expenditures were $138 million for 2000, $119 million for 1999 and $121 million for 1998. Environmental and Safety Regulations - ------------------------------------ Certain of the Company's operations are subject to federal, state and local environmental laws and regulations which impose limitations on the discharge of pollutants into the air and water and establish standards for treatment, storage and disposal of solid and hazardous wastes. The Company believes that it is in substantial compliance with applicable environmental laws and regulations. JMC previously operated wood treating facilities that chemically preserved utility poles, pilings and railroad ties. All such treating operations were discontinued or sold prior to 1982. These facilities used wood preservatives that included creosote, pentachlorophenol and chromium-arsenic-copper. While preservatives were handled in accordance with then existing law, environmental law now imposes retroactive liability, in some circumstances, on persons who owned or operated wood-treating sites. JMC is remediating some of its former sites and will remediate other sites in the future. The Company has made a provision for environmental remediation; however, there can be no assurance that estimates of environmental liabilities will not change. In addition to environmental compliance costs, the Company may incur costs related to alleged environmental damage associated with past or current waste disposal practices or other hazardous materials handling practices. For example, generators of hazardous substances found in disposal sites at which environmental problems are alleged to exist, as well as the 9 owners of those sites and certain other classes of persons, are subject to claims brought by state and federal regulatory agencies pursuant to statutory authority. The Company believes that its liability, if any, for past or current waste handling practices will not have a material adverse effect on its results of operation, financial condition and cash flow. The Company must also comply with various federal, state and local safety regulations in connection with its operations. The Company's compliance with these regulations has had no material adverse effect on its financial condition. Major Customers - --------------- The Company has no customers which accounted for more than 10% of consolidated sales in 2000. The Company's largest single customer is Sears, Roebuck and Co. ("Sears"), and although the relationship with Sears is long- standing, the Company believes the loss or material reduction of this business could have a material adverse effect on its operations. ITEM 2. PROPERTIES - ------------------- The Company occupies over 9 million square feet of manufacturing, distribution, service and office space at various domestic and foreign locations. The principal properties are listed below. The Company believes that its plants have adequate productive capacity and are suitably used for the manufacture of its products and that its warehouses, distribution centers and sales offices are suitably located and utilized for the marketing of its products and services. Manufacturing and distribution operations are located throughout the United States and in 29 other countries. Principal locations include:
Location Principal Use Owned/Leased - -------------------------------- ------------- ------------ Process/Environmental Controls - -------------------------------- Altoona, PA Manufacturing Owned Elizabethtown, NC Manufacturing Owned Sao Paulo, Brazil Manufacturing Owned Gurnee, IL Manufacturing Leased Brighton, England Manufacturing Leased
10 Aldingen, Germany Manufacturing Owned Cleveland, OH (3) Manufacturing Owned Goleta, CA Manufacturing Owned Juarez, Mexico Manufacturing Leased Lancaster, SC Manufacturing Owned Paso Robles, CA Manufacturing Leased San Jose, CA Manufacturing Owned Hemet, CA Manufacturing Owned West Carollton, OH Manufacturing Owned Basingstoke, England Manufacturing Owned Plainville, CT Manufacturing Owned Everett, WA Manufacturing Owned Einhoven, Netherlands Manufacturing Leased Chandler, AZ Manufacturing Leased Duarte, CA Manufacturing Leased Rockford, IL Manufacturing Leased Grants Pass, OR Manufacturing Owned Wilmington, MA Manufacturing Leased Kazmarek, Slovakia Manufacturing Leased Weymouth, MA Manufacturing Owned Loveland, CO Manufacturing Owned Ames, IA Manufacturing Owned Stockholm, Sweden Manufacturing Owned Enis, Ireland Manufacturing Leased Amherst, NY Manufacturing Leased Racine, WI Manufacturing Owned West Chester, PA Manufacturing Leased St. Kitts, West Indies Manufacturing Leased La Chaux-de-Fonds, Switzerland Manufacturing Owned Flen, Sweden Manufacturing Owned Buffalo, NY (3) Manufacturing Owned Grand Prairie, TX Manufacturing Owned Bretten, Germany Manufacturing Leased Bombay, India Manufacturing Leased Brno, Czech Republic Manufacturing Owned Commack, NY Manufacturing Leased Dusseldorf, Germany Manufacturing Leased Lawrence, MA Manufacturing Leased Petach Tikva, Israel Manufacturing Leased Radford, VA Manufacturing Owned Vista, CA Manufacturing Leased Arville, France Manufacturing Owned
11 Bien Hoa, Vietnam Manufacturing Owned Bologna, Italy Manufacturing Leased Northampton, MA Manufacturing Owned Hurffville, NJ Manufacturing Owned Marengo, IL Manufacturing Owned Bristol, CT Manufacturing Owned Lausanne, Switzerland Manufacturing Leased Wolfschlugen, Germany Manufacturing Owned Kristienstad, Sweden Manufacturing Owned Leake City, TX Manufacturing Lease Lakewood, CO Manufacturing Lease San Diego, CA Manufacturing Lease Norwich, England Manufacturing Owned Tools and Components - -------------------------------- Springdale, AK Manufacturing Owned Springfield, MA Manufacturing Owned Gastonia, NC Manufacturing Leased Fayetteville, AK (2) Manufacturing Owned Baltimore, MD Distribution Leased Brampton, Ontario Distribution Leased Lakewood, NY Manufacturing Owned Nashville, TN Distribution Owned Stow, OH Distribution Owned West Hartford, CT Manufacturing Owned Terryville, CT Manufacturing Owned Walworth, WI Manufacturing Owned Dundee, Scotland Manufacturing Owned Sheffield, England Manufacturing Owned Clemson, SC Manufacturing Owned Jonesboro, AK Manufacturing Owned Raleigh, NC Manufacturing Leased Chicago, IL (3) Manufacturing Owned Bloomfield, CT Manufacturing Owned LaVergne, TN Manufacturing Owned Bowling Green, KY Manufacturing Owned Suzhou, China Manufacturing Owned Shanghai, China (3) Manufacturing Owned Taichung, Taiwan Manufacturing Leased Dallas, TX Manufacturing Leased
In addition to the facilities listed, the Company owns or leases various facilities including offices or properties in Washington, District of Columbia; Simsbury, Connecticut; as well as facilities in Uppermill, Livingston, Gloucester and Richmond, 12 Great Britain; Melbourne and Sydney, Australia; Nagoya, Osaka and Tokyo, Japan; Toronto, Canada; Paris, Bron, Toulouse, Lyon, Bordeaux, Tours and Selestat, France; and Stuttgart, Germany. ITEM 3. LEGAL PROCEEDINGS - -------------------------- A former subsidiary of the Company is engaged in litigation in several states with respect to product liability. The Company sold the subsidiary in 1987. Under the terms of the sale agreement, the Company agreed to indemnify the buyer of the subsidiary for product liability related to tools manufactured by the subsidiary prior to June 4, 1987. The cases involve approximately 3,000 plaintiffs, in state and federal courts. All other major U.S. air tool manufacturers are also defendants. The gravamen of these complaints is that the defendants' air tools, when used in different types of manufacturing environments over extended periods of time, were defective in design and caused various physical injuries. The plaintiffs seek compensatory and punitive damages. The Company has accepted an agreement in principle to settle these claims. Completion of this settlement agreement will not result in a material adverse effect on the Company's results of operations or financial condition. In addition to the litigation noted above, the Company and its subsidiaries are from time to time subject to ordinary routine litigation incidental to their business. The Company believes that the results of the above noted litigation and other pending legal proceedings would not have a materially adverse effect on the Company's financial condition. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDER - ----------------------------------------------------------- No matters were submitted to a vote of security holders during the fourth quarter of 2000. PART II ITEMS 5 THROUGH 8. - ------------------ The information required under Items 5 through 8 is included in the Registrant's Annual Report to its Shareholders for the year ended December 31, 2000, and is incorporated herein by reference. 13 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND - ------------------------------------------------------------------------ FINANCIAL DISCLOSURE - -------------------- NONE PART III ITEMS 10 THROUGH 13. - ------------------- The information required under Items 10 through 13 is included in the Registrant's Proxy Statement for its 2001 annual meeting, and is incorporated herein by reference. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K - ------------------------------------------------------------------------- a) Document List 1. Financial Statements Response to this portion of Item 14 is submitted per the Index to Financial Statement Schedules on page 14 of this report. 2. Supplementary Data and Financial Statement Schedules Response to this portion of Item 14 is submitted per the Index to Financial Statement Schedules on page 14 of this report. 3. An Index of Exhibits is on page 15 of this report. b) Reports on Form 8-K filed in the fourth quarter of 2000. NONE 14 DANAHER CORPORATION INDEX TO FINANCIAL STATEMENTS, SUPPLEMENTARY DATA AND FINANCIAL STATEMENT SCHEDULES
Page Number in: --------------- Annual Report ------------- Form 10K To Shareholders -------- --------------- Annual Report: - ---------------------------------------- Report of Independent Public Accountants on Schedule 18 Financial Statements: - ---------------------------------------- Consolidated Statements of Earnings, years ended December 31, 2000, 1999, and 1998 9 Consolidated Balance Sheets, December 31, 2000 and 1999 10 Consolidated Statements of Cash Flows, years ended December 31, 2000, 1999, and 1998 12 Consolidated Statements of Stockholders' Equity, years ended December 31, 2000, 1999, and 1998 13 Notes to Consolidated Financial Statements 14 Supplemental Data: - ---------------------------------------- Market Prices of Common Stock 2 Selected Financial Data 3 Schedules: - ---------------------------------------- II - Valuation and Qualifying Accounts 19
Schedules other than those listed above have been omitted from this Annual Report because they are not required, are not applicable or the required information is included in the financial statements or the notes thereto. 15 Exhibits: - --------- (3) Articles of Incorporation and By-Laws (a) The Articles of Incorporation of Incorporated by Danaher Reference to Exh 3 of 6/26/98 Form 10-Q (b) The By-Laws of Danaher Incorporated by Reference to Exh 3 of 6/26/98 Form 10-Q (10) Material Contracts: (a) Employment Agreement between Danaher Incorporated by Corporation and George M. Sherman Reference to Exh 10(a) dated as of January 2, 1990 of 6/26/98 Form 10-Q (b) Credit Agreement Dated As of Incorporated by September 7, 1990. Among Danaher Reference to Exh 10(b) Corporation, the Financial of 6/26/98 10-Q Institutions Listed Therein and Bankers Trust Company as Agent (c) Agreement as of November 1, 1990 Incorporated by between Danaher Corporation, Easco Reference to Exh 10(c) Hand Tools, Inc. and Sears, of 6/26/98 Form 10-Q Roebuck and Co. (d) Note Agreement as of November 1, 1992 Incorporated by Between Danaher Corporation and Reference to Exh 10(d) Lenders Referenced Therein of 6/26/98 Form 10-Q (e) Note Agreement as of April 1, 1993 Incorporated by Between Danaher Corporation and Reference to Exh 10(d) Lenders Referenced Therein Of 6/26/98 Form 10-Q (f) Danaher Corporation 1998 Stock Option Incorporated by Plan Reference to Exh A of Proxy statement dated March 30, 1998 (g) Indenture Agreement as of October 28, Incorporated by 1998 Between Danaher Corporation and Reference to Form S-3 The First National Bank of Chicago, (File 333-63591) as Trustee (h) Fiscal Agency Agreement as of July Exhibit 10(h) 25, 2000 Between Danaher Corporation and Deutsche Bank AG London. (i) Employment Agreement between Danaher Exhibit 10(i) Corporation and H. Lawrence Culp, Jr. dated as of October 13, 2000. 16 (j) Indenture Agreement as of January 22, Incorporated by 2001 Between Danaher Corporation and Reference to Form S-3 SunTrust Bank, as Trustee (File 333-56406) (13) Annual Report to Securityholders (21) Subsidiaries of Registrant (23) Consent of Independent Public Accountants SIGNATURES Pursuant to the requirements of Section 13 or 15(d) 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. DANAHER CORPORATION By: /s/ GEORGE M. SHERMAN ------------------------- George M. Sherman President and Chief Executive Officer Date: March 29, 2001 /s/ GEORGE M. SHERMAN President and Chief Executive Officer - ------------------------------- George M. Sherman /s/ STEVEN M. RALES Chairman of the Board - ------------------------------- Steven M. Rales /s/ MITCHELL P. RALES Chairman of the Executive Committee - ------------------------------- Mitchell P. Rales /s/ WALTER G. LOHR, JR. Director - ------------------------------- Walter G. Lohr, Jr. /s/ DONALD J. EHRLICH Director - ------------------------------- Donald J. Ehrlich /s/ MORTIMER M. CAPLIN Director - ------------------------------- Mortimer M. Caplin /s/ ALAN G. SPOON Director - ------------------------------- Alan G. Spoon /s/ A. EMMET STEPHENSON, JR. Director - ------------------------------- A. Emmet Stephenson, Jr. /s/ PATRICK W. ALLENDER Executive Vice President-Chief Financial - ------------------------------- Officer and Secretary Patrick W. Allender /s/ CHRISTOPHER C. MCMAHON Vice President and Controller - ------------------------------- Christopher C. McMahon 17 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ON THE FINANCIAL STATEMENT SCHEDULES To Danaher Corporation: We have audited in accordance with auditing standards generally accepted in the United States, the consolidated financial statements included in the Danaher Corporation and Subsidiaries' Annual Report to Shareholders incorporated by reference in this Form 10-K, and have issued our report thereon dated January 24, 2001. Our audit was made for the purpose of forming an opinion on those statements taken as a whole. The schedules listed in the index are the responsibility of the Company's management and are presented for the purpose of complying with the Securities and Exchange Commission's rules and are not a part of the consolidated financial statements. These schedules have been subjected to the auditing procedures applied in the audit of the consolidated financial statements and, in our opinion, fairly state in all material respects the financial data required to be set forth therein in relation to the consolidated financial statements taken as a whole. ARTHUR ANDERSEN LLP Baltimore, Maryland January 24, 2001 18 DANAHER CORPORATION AND SUBSIDIARIES SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (000's omitted)
Additions Write Balance Charged Offs, Classification at to Charged Write Balance Beginning Costs to Downs at End of & other & of Period Expenses Accounts Deductions Period - ------------------------------------------------------------------------------------ Year Ended December 31, 2000 Allowances deducted from asset account: Allowance for doubtful accounts: $28,000 $11,723 $ 4,302 $ 7,025 $37,000 ======= ======= ======= ======= ======= Year Ended December 31, 1999 Allowances deducted from asset accounts: Allowance for doubtful accounts: $24,000 $10,756 $ 185(a) $ 6,941 $28,000 ======= ======= ======= ======= ======= Year Ended December 31, 1998 Allowances deducted from asset accounts: Allowance for doubtful accounts $19,000 $ 9,442 $ 2,698(a) $ 7,140 $24,000 ======= ======= ======= ======= =======
Notes:(a) - Amounts related to businesses acquired, net of amounts related to businesses disposed. 19 EX-10.H 2 dex10h.txt EXHIBIT 10.H Exhibit 10H EXECUTION COPY -------------- Dated July 25, 2000 Danaher Corporation (Euro)300,000,000 6 1/4 percent Notes due 2005 _____________________________________ FISCAL AGENCY AGREEMENT _____________________________________ CONTENTS
Clause Page 1. INTERPRETATION............................................... 1 2. APPOINTMENT OF PAYING AGENTS................................. 3 3. AUTHENTICATION AND DELIVERY OF NOTES......................... 3 4. PAYMENT TO THE FISCAL AGENT.................................. 4 5. NOTIFICATION OF NON-PAYMENT BY THE ISSUER.................... 4 6. DUTIES OF THE PAYING AGENTS.................................. 4 7. REIMBURSEMENT OF THE PAYING AGENTS........................... 5 8. NOTICE OF ANY WITHHOLDING OR DEDUCTION....................... 5 9. DUTIES OF THE FISCAL AGENT IN CONNECTION WITH REDEMPTION FOR TAXATION REASONS....................................... 5 10. RECEIPT AND PUBLICATION OF NOTICES........................... 5 11. CANCELLATION OF NOTES AND COUPONS............................ 6 12. ISSUE OF REPLACEMENT NOTES AND COUPONS....................... 6 13. RECORDS AND CERTIFICATES..................................... 7 14. COPIES OF THIS AGREEMENT AVAILABLE FOR INSPECTION............ 7 15. COMMISSIONS AND EXPENSES..................................... 7 16. INDEMNITY.................................................... 8 17. REPAYMENT BY FISCAL AGENT.................................... 8 18. CONDITIONS OF APPOINTMENT.................................... 8 19. COMMUNICATION WITH PAYING AGENTS............................. 9 20. TERMINATION OF APPOINTMENT................................... 9 21. MEETINGS OF NOTEHOLDERS...................................... 11
22. NOTICES...................................................... 12 23. TAXES........................................................ 12 24. COUNTERPARTS................................................. 13 25. DESCRIPTIVE HEADINGS......................................... 13 26. GOVERNING LAW AND SUBMISSION TO JURISDICTION................. 13 27. AMENDMENTS................................................... 13 SCHEDULE 1......................................................... 14 PART 1 - FORM OF THE TEMPORARY GLOBAL NOTE................ 14 PART 2 - FORM OF THE PERMANENT GLOBAL NOTE................ 25 SCHEDULE 2......................................................... 33 PART 1 - FORM OF DEFINITIVE NOTE AND COUPON............... 33 PART 2 - CONDITIONS OF THE NOTES.......................... 38 SCHEDULE 3 PROVISIONS FOR MEETINGS OF NOTEHOLDERS............................. 51
DANAHER CORPORATION (Euro)300,000,000 6 1/4 percent Notes due 2005 FISCAL AGENCY AGREEMENT Danaher Corporation 1250 24th Street, N.W.Table of Contents Washington, D.C. 20037 July 25, 2000 Ladies and Gentlemen: WHEREAS: (A) Danaher Corporation (the "Issuer") has agreed to issue (Euro)300,000,000 6 1/4 percent Notes due 2005 (the "Notes" which expression shall include, unless the context otherwise requires, any further Notes issued pursuant to Condition 16 and forming a single series with the Notes). (B) The Notes will be issued in bearer form in the denominations of (Euro)1,000, (Euro)10,000 and (Euro)100,000 each having, in the case of definitive Notes (the "Definitive Notes"), interest coupons ("Coupons") attached. (C) The Notes will initially be represented by a temporary Global Note (the "Temporary Global Note") in or substantially in the form set out in Part 1 of Schedule 1 which will be exchanged in accordance with its terms for a permanent Global Note (the "Permanent Global Note" and, together with the Temporary Global Note, the "Global Notes") in or substantially in the form set out in Part 2 of Schedule 1. (D) If issued, the Definitive Notes and Coupons will be in or substantially in the respective forms set out in Part 1 of Schedule 2. The Terms and Conditions of the Notes (the "Conditions") will be in or substantially in the form set out in Part 2 of Schedule 2. We wish to record the arrangements agreed between us for this purpose: 1. INTERPRETATION 1.1 In this Agreement, any reference to principal or interest includes any additional amounts payable in relation thereto under Condition 9. 1.2 Terms and expressions used but not defined herein have the respective meanings given to them in the Conditions. 1.3 As used in this Agreement and in the Conditions: "Conditions" means the Terms and Conditions of the Notes (as set out in Part 2 of Schedule 2 to this Agreement and as modified from time to time in accordance with their terms), and any reference to a numbered "Condition" is to the correspondingly numbered provision thereof; "(Euro)" and "euro" mean the single currency introduced at the start of the third stage of European economic and monetary union pursuant to the Treaty; "Fiscal Agent" and "Paying Agent" mean and include each Fiscal Agent and Paying Agent from time to time appointed to exercise the powers and undertake the duties conferred and imposed upon it by this Agreement and notified to the Noteholders under clause 20; "Noteholders" means the holders of the Notes for the time being; "Outstanding" means, in relation to the Notes, all the Notes issued other than: (a) those Notes which have been redeemed in full and cancelled pursuant to Condition 7 or otherwise pursuant to the Conditions; (b) those Notes in respect of which the due date for redemption under the Conditions has occurred and all sums due in respect of such Note (including all accrued interest) have been received by the Fiscal Agent in the manner provided in Clause 4 and remain available for payment against presentation and surrender of such Note or (as the case may be) the relevant Coupons; (c) those Notes which have been purchased and cancelled under Condition 7; (d) those Notes which have become void under Condition 11; (e) those mutilated or defaced Notes which have been surrendered and cancelled and in respect of which replacements have been issued pursuant to Condition 12; (f) (for the purposes only of ascertaining the principal amount of the Notes outstanding and without prejudice to the status for any other purpose of the relevant Notes) those Notes which are alleged to have been lost, stolen or destroyed and in respect of which replacements have been issued pursuant to Condition 12; or (g) the Temporary Global Note to the extent that it has been duly exchanged for the Permanent Global Notes and/or Notes in definitive form and the Permanent Global Note to the extent that it has been exchanged for Notes in definitive form, in each case pursuant to their respective provisions, provided that for each of the following purposes, namely: (i) the right to attend and vote at any meeting of the Noteholders or any of them; and (ii) the determination of how many and which Notes are for the time being outstanding for the purposes of Schedule 3; those Notes (if any) which are for the time being held by any person (including but not limited to, the Issuer or any of its Subsidiaries) for the benefit of the Issuer or any of its Subsidiaries shall (unless and until ceasing to be so held) be deemed not to remain outstanding; 2 "specified office" means in relation to any Fiscal Agent and Paying Agent the offices specified in clause 22 or any other specified offices as the Issuer may from time to time be duly notified pursuant to clause 22; and "Treaty" means the Treaty establishing the European Community, as amended by the Treaty of European Union. 2. APPOINTMENT OF PAYING AGENTS 2.1 The Issuer appoints, on the terms and subject to the conditions of this Agreement: (a) Deutsche Bank AG London as fiscal and principal paying agent (the "Fiscal Agent") in respect of the Notes; and (b) Deutsche Bank Luxembourg, S.A. and UBS AG as paying agents (together with the Fiscal Agent, the "Paying Agents") for the payment of principal of, and interest on, the Notes, in each case acting at its specified office. 2.2 The obligations of the Paying Agents are several and not joint. 3. AUTHENTICATION AND DELIVERY OF NOTES 3.1 The Issuer undertakes that the Permanent Global Note (duly executed on behalf of the Issuer) will be available to be exchanged for interests in the Temporary Global Note in accordance with the terms of the Temporary Global Note. 3.2 The Issuer undertakes that it will deliver to, or to the order of, the Fiscal Agent, not later than 10 days prior, to the Exchange Date (as defined in the Permanent Global Note), the Definitive Notes (with Coupons attached) in an aggregate principal amount of (Euro)300,000,000 or such lesser amount as is equal to the principal amount of Notes then outstanding. Each Definitive Note so delivered shall be duly executed on behalf of the Issuer. 3.3 The Issuer authorizes and instructs the Fiscal Agent (or its authorized agent) to authenticate the Global Notes and any Definitive Notes delivered pursuant to subclause 3.2. 3.4 The Issuer authorizes and instructs the Fiscal Agent to cause interests in the Temporary Global Note to be exchanged for interests in the Permanent Global Note or Definitive Notes, as the case may be, and interests in the Permanent Global Note to be exchanged for Definitive Notes, in each case in accordance with their respective terms. Following the exchange of the last interest in a Global Note, the Fiscal Agent shall cause the Global Note to be cancelled and delivered to the Issuer or as it may direct. 3.5 The Fiscal Agent shall cause all Notes delivered to and held by it under this Agreement to be maintained in safe custody and shall ensure that interests in the Temporary Global Note are only exchanged for interests in the Permanent Global Note or Definitive Notes, as the case may be, in accordance with the terms of the Temporary Global Note and this Agreement and that the Definitive Notes are issued only in accordance with the terms of the Permanent Global Note and this Agreement. 3 3.6 So long as any of the Notes is outstanding the Fiscal Agent shall, within seven days of any request by the Issuer, certify to the Issuer the number and principal amount of Notes held by it under this Agreement. 4. PAYMENT TO THE FISCAL AGENT 4.1 The Issuer shall, not later than 10.00 a.m. (Central European time) on each date on which any payment of principal and/or interest in respect of any of the Notes becomes due and payable, transfer to an account specified by the Fiscal Agent such amount of euro as shall be sufficient for the purposes of the payment of principal and/or interest in immediately available funds or in such funds and at such times (being not later than 10.00 a.m. (Central European time) on the relevant due date) as may be determined by the Fiscal Agent to be customary for the settlement of similar transactions. 4.2 The Issuer shall ensure that, not later than 10.00 a.m. (London time) on the second Business Day immediately preceding the date on which any payment is to be made to the Fiscal Agent pursuant to subclause 4.1, that the bank effecting payment on its behalf confirms to the Fiscal Agent by tested telex or authenticated SWIFT message that it has issued irrevocable payment instructions for the transfer of the relevant sum due on that date to the account of the Fiscal Agent. For the purposes of this subclause 4.2, "Business Day" means a day on which banks are open for business in London and on which the TARGET System is open. The Fiscal Agent will forthwith notify the Issuer by telex if it has not by 10.00 a.m. (London time) on the relevant Business Day received the confirmation and details referred to in this subclause and in the event that such failure is continuing at 3.00 p.m. (London time) on such day the Fiscal Agent will forthwith notify the other Paying Agents and the Issuer and in such event the Paying Agents shall not be bound to make payment in respect of the Notes until the Fiscal Agent notifies by telex each of the other Paying Agents that it has received unconditionally the full amount of any sum due in respect of the Notes. 5. NOTIFICATION OF NON-PAYMENT BY THE ISSUER The Fiscal Agent shall notify by telex each of the other Paying Agents forthwith: (a) if it has not by the specified time on the relevant date specified in clause 4.1 received unconditionally the full amount in euro required for the payment; and (b) if it receives unconditionally the full amount of any sum due in respect of the Notes or Coupons after such date. Upon receipt of a notice from the Fiscal Agent as described in subparagraph (a) and until receipt of a notice from the Fiscal Agent as described in subparagraph (b), no Paying Agent shall be obliged to make any payment in respect of the Notes. The Fiscal Agent shall, at the expense of the Issuer, forthwith upon receipt of any amount as described in subparagraph (b), cause notice of that receipt to be published under Condition 15. 6. DUTIES OF THE PAYING AGENTS 6.1 Subject to the payments to the Fiscal Agent provided for by clause 4.1 being duly made and subject to clause 4.2, the Paying Agents shall act as paying agents of the Issuer in respect of the Notes and pay or cause to be paid on behalf of the Issuer, on and after each date on which any payment becomes due and payable, the amounts of principal and/or interest then payable on 4 surrender or, in the case of a Global Note, endorsement, of Notes or Coupons under the Conditions and this Agreement. If any payment provided for by clause 4 is made late but otherwise under the terms of this Agreement, the Paying Agents shall nevertheless act as paying agents. 6.2 If default is made by the Issuer in respect of any payment, unless and until the full amount of the payment has been made under the terms of this Agreement (except as to the time of making the same) or other arrangements satisfactory to the Fiscal Agent have been made, neither the Fiscal Agent nor any of the other Paying Agents shall be bound to act as paying agents. 6.3 If on presentation of a Note or Coupon the amount payable in respect of the Note or Coupon is not paid in full (otherwise than as a result of the circumstances provided in Condition 7(b) or Condition 9) the Paying Agent to whom the Note or Coupon is presented shall procure that the Note or Coupon is enfaced with a memorandum of the amount paid and the date of payment. 6.4 If the Fiscal Agent pays any amounts to Noteholders or to the other Paying Agents at a time when it has not received payment in full in respect of such Note the Issuer shall, in addition to paying amounts due under clause 4.1, pay to the Fiscal Agent on demand interest at a rate reasonably determined by the Fiscal Agent to represent its cost of funding until receipt in full by the Fiscal Agent of the funds. 7. REIMBURSEMENT OF THE PAYING AGENTS The Fiscal Agent shall charge the account referred to in clause 4 for all payments made by it under this Agreement and will credit or transfer to the respective accounts of the other Paying Agents the amount of all payments made by them under the Conditions immediately upon notification from them, subject in each case to any applicable laws or regulations. 8. NOTICE OF ANY WITHHOLDING OR DEDUCTION If the Issuer is, in respect of any payment in respect of the Notes, compelled to withhold or deduct any amount as contemplated by Condition 7(b) or Condition 9, the Issuer shall give notice to the Fiscal Agent as soon as reasonably practicable after it becomes aware of the requirement to make the withholding or deduction and shall give to the Fiscal Agent such information as the Fiscal Agent shall require to enable it to comply with the requirement. 9. DUTIES OF THE FISCAL AGENT IN CONNECTION WITH REDEMPTION FOR TAXATION REASONS If the Issuer decides to redeem all the Notes for the time being outstanding under Condition 7(b) it shall give notice of the decision to the Fiscal Agent at least 15 days before the date on which notice is to be given to the Noteholders as required by Condition 15 and shall deliver the certificate and opinion referred to in Condition 7. 10. RECEIPT AND PUBLICATION OF NOTICES 10.1 Forthwith upon the receipt by the Fiscal Agent of a demand or notice from any Noteholder under Condition 10, the Fiscal Agent shall forward a copy of the demand or notice to the Issuer. 10.2 On behalf of and at the request and expense of the Issuer, the Fiscal Agent shall cause to be published all notices required to be given by the Issuer under the Conditions. 5 11. CANCELLATION OF NOTES AND COUPONS 11.1 All Notes which are surrendered in connection with redemption, (together with all unmatured Coupons attached to or delivered with Notes) and all Coupons which are paid shall be cancelled by the Paying Agent to which they are surrendered. Each of the Paying Agents shall give to the Fiscal Agent details of all payments made by it and shall deliver all cancelled Notes and Coupons to the Fiscal Agent (or as the Fiscal Agent may specify). Where Notes are purchased by or on behalf of the Issuer, the Issuer may ensure that the Notes (together with all unmatured Coupons appertaining to the Notes) are promptly cancelled and delivered to any Paying Agent. 11.2 Paying Agents shall (unless otherwise instructed by the Issuer in writing and save as provided in clause 13.1) destroy all cancelled Notes and Coupons and furnish the Issuer with a certificate of destruction containing written particulars of the serial numbers of the Notes and the number by maturity date of Coupons so destroyed. 12. ISSUE OF REPLACEMENT NOTES AND COUPONS 12.1 The Issuer shall cause a sufficient quantity of additional forms of Notes and Coupons to be available, upon request, to the Fiscal Agent at its specified office for the purpose of issuing replacement Notes or Coupons as provided below. 12.2 The Fiscal Agent shall, subject to and in accordance with Condition 12 and the following provisions of this clause, cause to be authenticated (in the case only of replacement Notes) and delivered any replacement Notes or Coupons which the Issuer may determine to issue in place of Notes or Coupons which have been lost, stolen, mutilated, defaced or destroyed. 12.3 In the case of a mutilated or defaced Definitive Note, the Fiscal Agent shall ensure that (unless otherwise covered by such indemnity as the Issuer may require) any replacement Definitive Note only has attached to it Coupons corresponding to those attached to the mutilated or defaced Definitive Note which is presented for replacement. 12.4 The Fiscal Agent shall endeavour to obtain verification, in the case of an allegedly lost, stolen or destroyed Note or Coupon in respect of which the serial number is known, that the Note or Coupon has not previously been redeemed or paid. The Fiscal Agent shall not issue a replacement Note or Coupon unless and until the applicant has: (a) paid such costs as may be incurred in connection with the replacement; (b) furnished it with such evidence and indemnity or otherwise as the Issuer and the Fiscal Agent may reasonably require; and (c) in the case of a mutilated or defaced Note or Coupon, surrendered it to the Fiscal Agent. 12.5 The Fiscal Agent shall cancel mutilated or defaced Notes or Coupons in respect of which replacement Notes or Coupons have been issued pursuant to this clause. The Fiscal Agent shall furnish the Issuer with a certificate stating the serial numbers of the Notes or Coupons received by it and cancelled pursuant to this clause and shall, unless otherwise requested by the Issuer, destroy all those Notes and Coupons and furnish the Issuer with a destruction certificate containing the information specified in clause 11.2. 6 12.6 The Fiscal Agent shall, on issuing any replacement Note or Coupon, forthwith inform the Issuer and the other Paying Agents of the serial number of the replacement Note or Coupon issued and (if known) of the serial number of the Note or Coupon in place of which the replacement Note or Coupon has been issued. Whenever replacement Coupons are issued under this clause, the Fiscal Agent shall also notify the other Paying Agents of the maturity dates of the lost, stolen, mutilated, defaced or destroyed Coupons and of the replacement Coupons issued. 12.7 Whenever a Note or Coupon for which a replacement Note or Coupon has been issued and the serial number of which is known is presented to a Paying Agent for payment, the relevant Paying Agent shall immediately send notice to the Issuer and the Fiscal Agent. 13. RECORDS AND CERTIFICATES 13.1 The Fiscal Agent shall (a) keep a full and complete record of all Notes and Coupons (other than serial numbers of Coupons) and of their redemption and/or purchase by or on behalf of the Issuer (other than purchases in the open market or by tender or by private agreement), cancellation or payment (as the case may be) and of all replacement Notes or Coupons issued in substitution for lost, stolen, mutilated, defaced or destroyed Notes or Coupons and (b) in respect of the Coupons of each maturity, retain until the expiry of five years from the Relevant Date in respect of the Coupons a list of the total numbers of Coupons of that maturity still remaining unpaid. The Fiscal Agent shall at all reasonable times make the records and Coupons (if any) available to the Issuer. 13.2 The Fiscal Agent shall give to the Issuer, as soon as possible and in any event within four months after the date of redemption, purchase, payment or replacement of a Note or Coupon (as the case may be), a certificate stating (a) the aggregate principal amount of Notes which have been redeemed and the aggregate amount in respect of Coupons which have been paid, (b) the serial numbers of those Notes in definitive form, (c) the total number of each denomination by maturity date of those Coupons, (d) the aggregate principal amounts of Notes (if any) which have been purchased by or on behalf of the Issuer and cancelled (subject to delivery of the Notes to the Fiscal Agent) and the serial numbers of such Notes in definitive form and the total number of each denomination by maturity date of the Coupons attached to or surrendered with the purchased Notes, (e) the aggregate principal amount of Notes and the aggregate amounts in respect of Coupons which have been surrendered and replaced and the serial numbers of those Notes in definitive form and the total number of each denomination by maturity date of the Coupons surrendered therewith and (f) the total number of each denomination by maturity date of unmatured Coupons missing from Notes which have been redeemed or surrendered and replaced and the serial numbers of the Notes in definitive form to which the missing unmatured Coupons appertained. 14. COPIES OF THIS AGREEMENT AVAILABLE FOR INSPECTION The Paying Agents shall hold copies of this Agreement available for inspection by Noteholders and Couponholders. For this purpose, the Issuer shall furnish the Paying Agents with sufficient copies of such document. 15. COMMISSIONS AND EXPENSES 15.1 The Issuer shall pay to the Fiscal Agent such commissions in respect of the services of the Paying Agents under this Agreement as shall be agreed between the Issuer and the Fiscal Agent. The Issuer shall not be concerned with the apportionment of payment among the Paying Agents. 7 15.2 The Issuer shall also pay to the Fiscal Agent an amount equal to any value added tax which may be payable in respect of the commissions together with all reasonable documented expenses including, without limitation, legal, advertising, cable and postage expenses, insurance costs and publication expenses incurred by the Paying Agents in connection with their services under this Agreement. 15.3 The Fiscal Agent shall arrange for payment of the commissions due to the other Paying Agents and arrange for the reimbursement of their reasonable documented expenses promptly after receipt of the relevant moneys from the Issuer. 16. INDEMNITY 16.1 The Issuer undertakes to indemnify each of the Paying Agents and their directors, officers, employees and controlling persons against all losses, liabilities, costs, claims, actions, damages, expenses or demands which any of them may incur or which may be made against any of them as a result of or in connection with the appointment of or the exercise of the powers and duties by any Paying Agent under this Agreement except as may result from its wilful default, negligence or bad faith or that of its directors, officers, employees or controlling persons or any of them, or breach by it of the terms of this Agreement. 16.2 Each of the Paying Agents severally undertakes to indemnify the Issuer and the Issuer's directors, officers, employees and controlling persons against all losses, liabilities, costs, claims, actions, damages, expenses or demands which any of them may incur or which may be made against any of them as a result of its wilful default, negligence or bad faith or that of its directors, officers, employees or controlling persons or any of them, or breach by it of the terms of this Agreement. 16.3 This clause shall survive the termination or expiry of this Agreement. 17. REPAYMENT BY FISCAL AGENT Sums paid by or by arrangement with the Issuer to the Fiscal Agent pursuant to the terms of this Agreement shall not be required to be repaid to the Issuer unless and until any Note or Coupon becomes void under the provisions of Condition 11 but in that event the Fiscal Agent shall forthwith repay to the Issuer sums equivalent to the amounts which would otherwise have been payable in respect of the relevant Note or Coupon. 18. CONDITIONS OF APPOINTMENT 18.1 Subject as provided in subclause 18.3 of this clause the Fiscal Agent shall he entitled to deal with money paid to it by the Issuer for the purposes of this Agreement in the same manner as other money paid to a banker by its customers and shall not be liable to account to the Issuer for any interest or other amounts in respect of the money. No money held by any Paying Agent need be segregated except as required by law. 18.2 In acting under this Agreement and in connection with the Notes and the Coupons the Paying Agents shall act solely as agents of the Issuer and will not assume any obligation towards or relationship of agency or trust for or with any of the owners or holders of the Notes or the Coupons. 18.3 No Paying Agent shall exercise any right of set-off or lien against the Issuer or any holders of Notes or Coupons in respect of any moneys payable to or by it under the terms of this Agreement. 8 18.4 Except as ordered by a court of competent jurisdiction or required by law or otherwise instructed by the Issuer, each of the Paying Agents shall be entitled to treat the holder of any Note or Coupon as the absolute owner thereof (whether or not the Note or Coupon shall be overdue and notwithstanding any notice of ownership or writing thereon, any notice of previous loss or theft thereof, or any notice of any trust or other interest therein) for the purpose of making payment and for all other purposes and shall not be required to obtain any proof thereof or as to the identity of such holder. 18.5 The Paying Agents shall be obliged to perform such duties and only such duties as are set out in this Agreement and the Notes and no implied duties or obligations shall be read into this Agreement or the Notes against the Paying Agents. 18.6 The Fiscal Agent may consult with legal and other professional advisers and the opinion of the advisers shall be full and complete protection in respect of action taken, omitted or suffered under this Agreement in good faith and in accordance with the opinion of the advisers. The Issuer agrees to reimburse the Fiscal Agent for all reasonable expenses incurred in consultation with such legal or other professional advisers. 18.7 Each of the Paying Agents shall be protected and shall incur no liability for or in respect of action taken, omitted or suffered in good faith in reliance upon any instruction, request or order from the Issuer or any other Paying Agent, or any Note or Coupon, or any notice, resolution, direction, consent, certificate, affidavit, statement, facsimile, telex or other paper or document which it reasonably believes to be genuine and to have been delivered, signed or sent by the proper party or parties or upon written instructions from the Issuer. 18.8 Any of the Paying Agents, their officers, directors, employees or controlling persons, may become the owner of, or acquire any interest in, Notes or Coupons with the same rights that it or he would have if the Paying Agent concerned were not appointed under this Agreement, and may engage or be interested in any financial or other transaction with the Issuer, and may act on, or as depository, trustee or agent for, any committee or body of holders of Notes or Coupons or other obligations of the Issuer, as freely as if the Paying Agent concerned were not appointed under this Agreement and without accounting for any profit. 18.9 The Fiscal Agent shall not be under any obligation to take any action under this Agreement which it expects will result in any expense or liability accruing to it, the payment of which within a reasonable time is not, in its opinion, assured to it. 19. COMMUNICATION WITH PAYING AGENTS A copy of all communications relating to the subject matter of this Agreement between the Issuer and any of the Paying Agents other than the Fiscal Agent shall be sent to the Fiscal Agent. 20. TERMINATION OF APPOINTMENT 20.1 The Issuer may terminate the appointment of any Paying Agent at any time and/or appoint additional or other Paying Agents by giving to the Paying Agent whose appointment is concerned and, where appropriate, the Fiscal Agent, at least 90 days' prior written notice to that effect, provided that, so long as any of the Notes is outstanding: (a) in the case of a Paying Agent, the notice shall not expire less than 45 days before any due date for the payment of interest; and 9 (b) notice shall be given under Condition 15 not less than 30 days, nor more than 45 days, before the removal or appointment of a Paying Agent. 20.2 Notwithstanding the provisions of subclause 20.1, if at any time a Paying Agent becomes incapable of acting, or is adjudged bankrupt or insolvent, or files a voluntary petition in bankruptcy or makes an assignment for the benefit of its creditors or consents to the appointment of an administrator, liquidator or administrative or other receiver of all or any substantial part of its property, or if an administrator, liquidator or administrative or other receiver of it or of all or a substantial part of its property is appointed, or it admits in writing its inability to pay or meet its debts as they may mature or suspends payment of its debts, or if an order of any court is entered approving any petition filed by or against it under the provisions of any applicable bankruptcy or insolvency law or if a public officer takes charge or control of the Paying Agent or of its property or affairs for the purpose of rehabilitation, administration or liquidation, the Issuer may forthwith without notice terminate the appointment of the Paying Agent, in which event notice shall be given to the Noteholders under Condition 15 as soon as is practicable. 20.3 The termination of the appointment of a Paying Agent under this Agreement shall not entitle the Paying Agent to any amount by way of compensation but shall be without prejudice to any amount then accrued due. 20.4 All or any of the Paying Agents may resign their respective appointments under this Agreement at any time by giving to the Issuer and, where appropriate, the Fiscal Agent at least 90 days' prior written notice to that effect provided that, so long as any of the Notes is outstanding, the notice shall not expire less than 45 days before any due date for the payment of interest. Following receipt of a notice of resignation from a Paying Agent, the Issuer shall promptly, and in any event not less than 30 days before the resignation takes effect, give notice to the Noteholders (through the Fiscal Agent) under Condition 15. If any Paying Agent shall resign or be removed pursuant to subclauses 20.1 or 20.2 above or in accordance with this subclause 20.4, the Issuer shall promptly and in any event within 30 days appoint a successor. If the Issuer fails to appoint a successor within such period, the relevant Paying Agent may select a leading bank (which, in the case of the Fiscal Agent, shall be a leading bank acting through its office in London) to act as Paying Agent hereunder and the Issuer shall appoint that bank as the successor Paying Agent. 20.5 Notwithstanding the provisions of subclauses 20.1, 20.2 and 20.4, so long as any of the Notes is outstanding, the termination of the appointment of a Paying Agent (whether by the Issuer or by the resignation of the Paying Agent) shall not be effective unless upon the expiry of the relevant notice there is: (a) a Fiscal Agent; and (b) at least one Paying Agent having a specified office in a city in western Europe which, so long as the Notes are listed on the Luxembourg Stock Exchange, will be in Luxembourg. 20.6 Any successor Paying Agent shall execute and deliver to its predecessor, the Issuer, and, where appropriate, the Fiscal Agent an instrument accepting the appointment under this Agreement, and the successor Paying Agent, without any further act, deed or conveyance, shall become vested with all the authority, rights, powers, trusts, immunities, duties and obligations of the predecessor with like effect as if originally named as a Paying Agent. 20.7 If the appointment of a Paying Agent under this Agreement is terminated (whether by the Issuer or by the resignation of the Paying Agent), the Paying Agent shall on the date on which the 10 termination takes effect deliver to its successor Paying Agent (or, if none, the Fiscal Agent) all Notes and Coupons surrendered to it but not yet destroyed and all records concerning the Notes and Coupons maintained by it (except such documents and records as it is obliged by law or regulation to retain or not to release) and pay to its successor Paying Agent (or, if none, to the Fiscal Agent) the amounts (if any) held by it in respect of Notes or Coupons which have become due and payable but which have not been presented for payment, but shall have no other duties or responsibilities under this Agreement. 20.8 If the Fiscal Agent or any of the other Paying Agents shall change its specified office, it shall give to the Issuer and, where appropriate, the Fiscal Agent not less than 45 days' prior written notice to that effect giving the address of the new specified office. As soon as practicable thereafter and in any event at least 30 days before the change, the Fiscal Agent shall give to the Noteholders on behalf of and at the expense of the Issuer notice of the change and the address of the new specified office under Condition 15. 20.9 A corporation into which any Paying Agent for the time being may be merged or converted or a corporation with which the Paying Agent may be consolidated or a corporation resulting from a merger, conversion or consolidation to which the Paying Agent shall be a party shall, to the extent permitted by applicable law, be the successor Paying Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties to this Agreement. Notice of any merger, conversion or consolidation shall forthwith be given to the Issuer and, where appropriate, the Fiscal Agent. 21. MEETINGS OF NOTEHOLDERS 21.1 The provisions of Schedule 3 shall apply to meetings of the Noteholders and shall have effect in the same manner as if set out in this Agreement provided that, so long as any of the Notes are represented by a Global Note, the expression "Noteholders" shall include the persons for the time being shown in the records of Morgan Guaranty Trust Company of New York, Brussels office, as operator of the Euroclear System ("Euroclear") and/or Clearstream Banking, societe anonyme, Luxembourg ("Clearstream, Luxembourg"), as the holders of a particular principal amount of such Notes (each an "Accountholder") (in which regard a certificate or other document issued by Euroclear or Clearstream, Luxembourg as to the principal amount of such Notes standing to the account of any person shall be conclusive and binding) for all purposes other than with respect to the payment of principal and interest on such Notes, the right to which shall be vested as against the Issuer solely in the bearer of each Global Note in accordance with and subject to its terms, and the expressions "holder" and "holders" shall be construed accordingly and in connection with the meetings of Noteholders the expression "Notes" shall mean units of . (Euro)1,000 principal amount of Notes. 21.2 Without prejudice to subclause 21.1, each of the Paying Agents shall, on the request of any holder of Notes, issue Voting Certificates and Block Voting Instructions (as defined in paragraph 1 of Schedule 3) together, if so required by the Issuer, with reasonable proof satisfactory to the Issuer of their due execution on behalf of the Paying Agent under the provisions of Schedule 3 and shall forthwith give notice to the Issuer under Schedule 3 of any revocation or amendment of a Voting Certificate or Block Voting Instruction. Each Paying Agent shall keep a full and complete record of all Voting Certificates and Block Voting Instructions issued by it and shall, not less than 24 hours before the time appointed for holding any meeting or adjourned meeting, deposit at such place as the Fiscal Agent shall designate or approve, full particulars of all Voting Certificates and Block Voting Instructions issued by it in respect of any meeting or adjourned meeting. 11 22. NOTICES Any notice required to be given under this Agreement to any of the parties shall be delivered in person, sent by pre-paid post (first class if inland, first class airmail if overseas) or by facsimile or telex addressed to: The Issuer: Danaher Corporation 1250 24th Street, N.W. Washington, D.C. 20037 Telex No: 202-828-0850 Facsimile No: 202-828-0860 (Attention: Patrick Allender) The Fiscal Agent: Deutsche Bank AG London Winchester House 1 Great Winchester Street London EC2N 2DB Telex No: 883341 BANT Facsimile No: (0207)5476149 (Attention: Corporate Trust and Agency Services) The Paying Agents: Deutsche Bank Luxembourg S.A. UBS AG 2 Boulevard Konrad Adenauer Bahnhofstrasse 45 L-1115 Luxembourg CH-8098 Zurich Switzerland Telex No: 3392 BTLLU Facsimile No: 00 352 473 136 Telex No: 8128581 BVZCH (Attention: Coupon Paying Department) Facsimile No: 00 411 236 5333 (Attention:WS-Coupons)
or such other address of which notice in writing has been given to the other parties to this Agreement under the provisions of this clause. Any notice shall take effect on receipt, provided that if sent by telex it shall be deemed to be received if and when the addressee's answerback shall have been received at the end of transmission, and provided further that any notice, request, demand or other communication received on a non-working day or after business hours in the place of receipt shall be deemed to be received on the next following working day in such place. 23. TAXES The Issuer agrees to pay any and all stamp and other documentary taxes or duties which shall be payable in connection with the execution, delivery, performance and enforcement of this Agreement (except any stamp and other documentary taxes or duties resulting from the enforcement of this Agreement which are payable pursuant to clause 16.2). 12 24. COUNTERPARTS This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed an original and all of which taken together shall constitute one and the same agreement. 25. DESCRIPTIVE HEADINGS The descriptive headings in this Agreement are for convenience of reference only and shall not define or limit the provisions of this Agreement. 26. GOVERNING LAW AND SUBMISSION TO JURISDICTION 26.1 The provisions of this Agreement are governed by, and shall be construed in accordance with, the laws of the State of New York. 26.2 The Issuer agrees that any State or federal courts sitting in the Borough of Manhattan, The City of New York, shall have jurisdiction to settle any disputes which may arise out of or in connection with this Agreement and accordingly any legal action or proceedings arising out of or in connection with the Notes or the Coupons (the "Proceedings") may be brought in such courts. The Issuer irrevocably submits to the jurisdiction of such courts and waives any objection which it may now or hereafter have to Proceedings in any such courts whether on the ground of the laying of venue or on the ground that the Proceedings have been brought in an inconvenient forum. This submission is made for the exclusive benefit of each of the Paying Agents and shall not limit the right of any of them to take Proceedings in any other court of competent jurisdiction nor shall the taking of Proceedings in one or more jurisdictions preclude the taking of Proceedings in any other jurisdiction (whether concurrently or not). To the extent that the Issuer has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process with respect to itself or its property, the Issuer irrevocably waives such immunity in respect of its obligations under this Agreement. 27. AMENDMENTS This Agreement may be amended by all of the parties, without the consent of any Noteholder or Couponholder, either: (a) for the purpose of curing any ambiguity or of curing, correcting or supplementing any defective provision contained in this Agreement; or (b) in any manner which the parties may mutually deem necessary or desirable and which shall not be inconsistent with the Conditions and shall not be materially prejudicial to the interests of the Noteholders. SIGNED by each of the parties (or their duly authorized representatives) as of the date first above written. 13 SCHEDULE 1 PART 1 FORM OF TEMPORARY GLOBAL NOTE DANAHER CORPORATION (incorporated under the laws of the State of Delaware) TEMPORARY GLOBAL NOTE (Euro)300,000,000 6 1/4 percent Notes due 2005 This temporary Global Note is issued in respect of the 6 1/4 percent Notes due 2005 (the "Notes") of Danaher Corporation (the "Issuer"). The Notes are issued subject to and with the benefit of a Fiscal Agency Agreement (the "Fiscal Agency Agreement") dated July 25, 2000 between, inter alios, the Issuer and Deutsche Bank AG London as Fiscal Agent (the "Fiscal Agent). The Notes are issued subject to and with the benefit of the Terms and Conditions of the Notes (the "Conditions") set out in Part 2 of Schedule 2 to the Fiscal Agency Agreement. 1. Promise To Pay Subject as provided in this temporary Global Note, the Issuer, for value received, promises to pay the bearer upon presentation and surrender of this temporary Global Note the sum of (Euro)300,000,000 or such lesser sum as is shown by the latest entry in Part I or Part II of the Schedule to this temporary Global Note on July 26, 2005 or on such earlier date as the principal of this temporary Global Note may become due under the Conditions and to pay interest on the principal sum for the time being outstanding at the rate of 6 1/4 percent per annum from July 26, 2000 payable annually in arrears on July 26 in each year until payment of the principal sum has been made or duly provided for in full together with any other amounts as may be payable, all subject to and under the Conditions. 2. Exchange For Permanent Global Note And Cancellations The permanent Global Note to be issued on exchange for interests in this temporary Global Note will be substantially in the form set out in Part 2 of Schedule 1 to the Fiscal Agency Agreement. Subject as provided below, the permanent Global Note will only have an entry made to represent Definitive Notes after the date which is 90 days after the closing date for the Notes. Interests in this temporary Global Note may be exchanged for interests in a duly executed and authenticated permanent Global Note without charge and the Fiscal Agent or such other person as the Fiscal Agent may direct (the "Exchange Agent") shall make the appropriate entry on Part I of the Schedule to the permanent Global Note in full or partial exchange for this temporary Global Note, in order that the permanent Global Note represents an aggregate principal amount of Notes equal to the principal amount of this temporary Global Note submitted for exchange. Notwithstanding the foregoing, no such entry shall be made on the permanent Global Note unless there shall have been presented to the Exchange Agent a certificate from Morgan Guaranty Trust 14 Company of New York, Brussels office, as operator of the Euroclear System ("Euroclear") or Clearstream Banking, societe anonyme, Luxembourg ("Clearstream, Luxembourg") substantially in the form of the certificate attached as Exhibit A. Notwithstanding the foregoing, where this temporary Global Note has been exchanged in part for the permanent Global Note pursuant to the foregoing and Definitive Notes have been issued in exchange for the total amount of Notes represented by the permanent Global Note pursuant to its terms, then interests in this temporary Global Note will no longer be exchangeable for interests in the permanent Global Note but will be exchangeable, in full or partial exchange, for duly executed and authenticated Definitive Notes, without charge, in the denominations of 1,000, 10,000 and 100,000 each with interest coupons attached, such Definitive Notes to be substantially in the form set out in Part 1 of Schedule 2 to the Fiscal Agency Agreement. Notwithstanding the foregoing, Definitive Notes shall not be so issued and delivered unless there shall have been presented to the Exchange Agent a certificate from Euroclear or Clearstream, Luxembourg substantially in the form of the certificate attached as Exhibit A. Any person who would, but for the provisions of this temporary Global Note and of the Fiscal Agency Agreement, otherwise be entitled to receive either (i) an interest in the permanent Global Note or (ii) Definitive Notes shall not be entitled to require the exchange of an appropriate part of this temporary Global Note for an interest in the permanent Global Note or Definitive Notes unless and until he shall have delivered or caused to be delivered to Euroclear or Clearstream, Luxembourg a certificate in substantially the form of the certificate attached as Exhibit B (copies of which form of certificate will be available at the offices of Euroclear in Brussels and Clearstream, Luxembourg in Luxembourg and the specified offices of each Paying Agent named in the Fiscal Agency Agreement). Upon (a) any exchange of the whole or a part of this temporary Global Note for an interest in the permanent Global Note or for a Definitive Note or (b) receipt of instructions from Euroclear or Clearstream, Luxembourg that, following the purchase by or on behalf of the Issuer of the whole or a part of this temporary Global Note, part is to be cancelled, the portion of the principal amount of this temporary Global Note so exchanged or cancelled shall be entered by or on behalf of the Fiscal Agent on Part I of the Schedule to this temporary Global Note, whereupon the principal amount of this temporary Global Note shall be reduced for all purposes by the amount so exchanged or cancelled and entered. 3. Benefits Until the entire principal amount of this temporary Global Note has been extinguished in exchange for the permanent Global Note and/or Definitive Notes, this temporary Global Note shall in all respects be entitled to the same benefits as the Definitive Notes referred to above, except that the holder of this temporary Global Note shall only be entitled to receive any payment on this temporary Global Note on presentation of certificates as provided below. 4. Payments Payments due in respect of Notes for the time being represented by this temporary Global Note shall be made to the bearer of this temporary Global Note only upon presentation by Euroclear or, as the case may be, Clearstream, Luxembourg, to the Fiscal Agent at its specified office of a certificate, substantially in the form of the certificate attached as Exhibit A, to the effect that Euroclear, or as the case may be, Clearstream, Luxembourg, has received a certificate substantially in the form of the certificate attached as Exhibit B. 15 Upon any payment in respect of the Notes represented by this temporary Global Note, the amount so paid shall be endorsed by or on behalf of the Fiscal Agent on Part II of the Schedule to this temporary Global Note, which endorsement shall, in the absence of manifest error, be prima facie evidence that such payment has been made in respect of the Notes. In the case of any payment of principal the principal amount of this temporary Global Note shall be reduced for all purposes by the amount so paid and the remaining principal amount of this temporary Global Note shall be entered by or on behalf of the Fiscal Agent on Part II of the Schedule to this temporary Global Note. On and after October 24, 2000, no payment will be made on this temporary Global Note unless exchange for an interest in the permanent Global Note is improperly withheld or refused. 5. Accountholders For so long as any of the Notes is represented by this temporary Global Note and this temporary Global Note is held on behalf of Euroclear and/or Clearstream, Luxembourg, each person who is for the time being shown in the records of Euroclear and/or Clearstream, Luxembourg as the holder of a particular principal amount of such Notes (each an "Accountholder") (in which regard any certificate or other document issued by Euroclear or Clearstream, Luxembourg as to the principal amount of such Notes standing to the account of any such person shall be conclusive and binding for all purposes) shall be treated as the holder of that principal amount of such Notes for all purposes (including for the purposes of any quorum requirements of, or the right to demand a poll at, meetings of the Noteholders) other than with respect to the payment of principal and interest on such Notes, the right to which shall be vested, as against the Issuer and the Paying Agents, solely in the bearer of this temporary Global Note in accordance with and subject to its terms. Each Accountholder must look solely to Euroclear or Clearstream, Luxembourg, as the case may be, for its share of each payment made to the bearer of this temporary Global Note. Notes represented by this temporary Global Note are transferable in accordance with the rules and procedures for the time being of Euroclear or Clearstream, Luxembourg as appropriate. The Issuer covenants in favour of each Accountholder that it will make all payments in respect of the Notes, for the time being shown in the records of Euroclear and/or Clearstream, Luxembourg as being held by the Accountholder and represented by this temporary Global Note to the bearer of this temporary Global Note in accordance with clause 1 above and acknowledges that each Accountholder may take proceedings to enforce this covenant and any of the other rights which it has under the first paragraph of this clause directly against the Issuer. 6. Notices Notices to be given by the Issuer will be given at least once by publication in a daily newspaper in the English language with general circulation in London, England, and, so long as the Notes are listed on the Luxembourg Stock Exchange and the rules of the Luxembourg Stock Exchange so require, in a daily newspaper of general circulation in Luxembourg. If publication in London or Luxembourg is impractical, notices shall be published by such means as will, so far as may be reasonably practicable, approximate publication in such newspaper. Publication is expected to be made in the Luxemburger Wort in Luxembourg and the Financial Times in London. Such notices will be deemed to have been given on the date of such publication or, if published more than once, on the date of the first such publication. 16 For so long as any of the Notes are represented by this temporary Global Note and/or the permanent Global Note and this temporary Global Note and/or the permanent Global Note is/are held on behalf of Euroclear and/or Clearstream, Luxembourg, notices may be given by delivery of the relevant notice to Euroclear and/or Clearstream, Luxembourg (as the case may be) for communication to the relative Accountholders rather than by publication as required in the preceding paragraph provided that, so long as the Notes are listed on the Luxembourg Stock Exchange, and the rules of that stock exchange so require, notices to Noteholders will be published in one daily newspaper in Luxembourg (which is expected to be the Luxemburger Wort). Any such notice shall be deemed to have been given to the Noteholders on the day after such notice is delivered to Euroclear and or Clearstream, Luxembourg (as the case may be) as aforesaid or the date of publication, whichever is earlier. 7. Prescription Claims against the Issuer in respect of principal and interest on the Notes represented by this temporary Global Note will be prescribed after 10 years (in the case of principal) and five years (in the case of interest) from the Relevant Date (as defined in Condition 4). 8. Cancellation Cancellation of any Note represented by this temporary Global Note will be effected by endorsement by or on behalf of the Fiscal Agent of the reduction in the principal amount of this temporary Global Note on Part I of the Schedule hereto. 9. Authentication This temporary Global Note shall not become valid or enforceable for any purpose unless and until it has been authenticated by or on behalf of the Fiscal Agent. 10. Governing Law This temporary Global Note is governed by, and shall be construed in accordance with, the laws of the State of New York. 17 IN WITNESS whereof the Issuer has caused this temporary Global Note to be duly executed under its corporate seal to be affixed or imported hereon. DANAHER CORPORATION By: __________________________________ Name: __________________________________ Title: __________________________________ Attest: __________________________________ Name: __________________________________ Title: __________________________________ Issued on July __, 2000 CERTIFICATE OF AUTHENTICATION This is the temporary Global Note described in the Fiscal Agency Agreement By or on behalf of Deutsche Bank AG London, as Fiscal Agent (without recourse, warranty or liability) By: __________________________________ Authorized Signatory ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE 18 THE SCHEDULE TO THE TEMPORARY GLOBAL NOTE Part I EXCHANGES FOR THE PERMANENT GLOBAL NOTE/DEFINITIVE NOTES AND CANCELLATIONS The following exchanges of a part of this temporary Global Note for interests in the permanent Global Note/Definitive Notes and cancellations of a part of the aggregate principal amount of this temporary Global Note have been made:
Date of exchange or Part of the Part of the Remaining principal Notation made by or cancellation aggregate principal aggregate principal amount of this on behalf of the amount of this amount of this temporary Global Fiscal Agent temporary Global temporary Global Note following Note exchanged for Note cancelled exchange or interests in the cancellation permanent Global Note/Definitive Notes (Euro) (Euro) (Euro) _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________
19 Part II PAYMENTS The following payments in respect of the Notes represented by this temporary Global Note have been made:
Date of payment Amount of interest Amount of principal Remaining principal Notation made by or paid paid amount of this on behalf of the temporary Global Fiscal Agent Note following payment of principal (Euro) (Euro) (Euro) _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________ _______________
20 EXHIBIT A DANAHER CORPORATION (incorporated under the laws of the State of Delaware) (Euro)300,000,000 6 1/4 percent Notes due 2005 (the "Securities") This is to certify that, based solely on certifications we have received in writing, by tested telex or by electronic transmission from member organizations appearing in our records as persons being entitled to a portion of the principal amount set forth below (our "Member Organizations") (such certifications "Member Certifications") substantially to the effect set forth in the Fiscal Agency Agreement, as of the date hereof, (Euro)300,000,000 principal amount of the above-captioned Securities (i) is owned by persons that are not citizens or residents of the United States, domestic partnerships, domestic corporations or any estate or trust the income of which is subject to United States federal income taxation regardless of its source ("United States persons"), (ii) is owned by United States persons that (a) are foreign branches of United States financial institutions (as defined in U.S. Treasury Regulations Section 1.165-12(c)(1)(v)) ("financial institutions") purchasing for their own account or for resale, or (b) acquired the Securities through foreign branches of United States financial institutions and who hold the Securities through such United States financial institutions on the date hereof (and in either case (a) or (b), each such United States financial institution has agreed, on its own behalf or through its agent, that we may advise the Issuer or the Issuer's agent that it will comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and the regulations thereunder), or (iii) is owned by United States or foreign financial institutions for purposes of resale during the restricted period (as defined in U.S. Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7)), and to the further effect that United States or foreign financial institutions described in clause (iii) above (whether or not also described in clause (i) or (ii)) have certified that they have not acquired the Securities for purposes of resale directly or indirectly to a United States person or to a person within the United States or its possessions. If the Securities are of the category contemplated in Section 230.903(c)(3) of Regulation S under the Securities Act of 1933, as amended, then this is also to certify with respect to such principal amount of Securities set forth above that, except as set forth below, we have received in writing, by tested telex or by electronic transmission, from our Member Organizations entitled to a portion of such principal amount, certifications with respect to such portion, substantially to the effect set forth in the Fiscal Agency Agreement. We further certify (i) that we are not making available herewith for exchange (or, if relevant, exercise of any rights or collection of any interest) any portion of the temporary global Security excepted in such certifications, (ii) that as of the date hereof we have not received any notification from any of our Member Organizations to the effect that the statements made by such Member Organizations with respect to any portion of the part submitted herewith for exchange (or, if relevant, exercise of any rights or collection of any interest) are no longer true and cannot be relied upon as of the date hereof and (iii) that we shall retain the Member Certifications for a period of four calendar years following the year such Member Certifications were obtained. 21 We understand that this certification is required in connection with certain tax laws and, if applicable, certain securities laws of the United States. In connection therewith, if administrative or legal proceedings are commenced or threatened in connection with which this certification is or would he relevant, we irrevocably authorize you to produce this certification to any interested party in such proceedings. *Dated [Morgan Guaranty Trust Company of New York, Brussels office, as operator of the Euroclear System] [Clearstream, Luxembourg] By ______________________________ Authorized Signatory __________________________ * To be dated no earlier than the date to which this certification relates, namely (a) payment date or (b) the date set for the exchange of the temporary Global Note for an interest in the permanent Global Note. 22 EXHIBIT B DANAHER CORPORATION (incorporated under the laws of the State of Delaware) (Euro)300,000,000 6 1/4 percent Notes due 2005 (the "Securities") This is to certify that as of the date hereof, and except as set forth below, the above-captioned Securities held by you for our account (i) are owned by person(s) that are not citizens or residents of the United States, domestic partnerships, domestic corporations or any estate or trust the income of which is subject to United States federal income taxation regardless of its source ("United States person(s)"), (ii) are owned by United States person(s) that (a) are foreign branches of United States financial institutions (as defined in U.S. Treasury Regulations Section 1.165-12(c)(1)(v)) ("financial institutions") purchasing for their own account or for resale, or (b) acquired the Securities through foreign branches of United States financial institutions and who hold the Securities through such United States financial institutions on the date hereof (and in either case (a) or (b), each such United States financial institution hereby agrees, on its own behalf or through its agent, that you may advise the Issuer or the Issuer's agent that it will comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and the regulations thereunder), or (iii) are owned by United States or foreign financial institution(s) for purposes of resale during the restricted period (as defined in U.S. Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7)), and in addition if the owner of the Securities is a United States or foreign financial institution described in clause (iii) above (whether or not also described in clause (i) or (ii)) this is further to certify that such financial institution has not acquired the Securities for the purposes of resale directly or indirectly to a United States person or to a person within the United States or its possessions. If the Securities are of the category contemplated in Section 230.903(c)(3) of Regulation S under the Securities Act of 1933, as amended (the "Act"), then this is also to certify that, except as set forth below (i) in the case of debt securities, the Securities are beneficially owned by (a) non-U.S. person(s) or (b) U.S. person(s) who purchased the Securities in transactions which did not require registration under the Act; or (ii) in the case of equity securities, the Securities are owned by (x) non-U.S. person(s) (and such person(s) are not acquiring the Securities for the account or benefit of U.S. person(s)) or (y) U.S. person(s) who purchased the Securities in a transaction which did not require registration under the Act. If this certification is being delivered in connection with the exercise of warrants pursuant to Section 230.902(m) of Regulation S under the Act, then this is further to certify that, except as set forth below, the Securities are being exercised by and on behalf of non-U.S. person(s). As used in this paragraph the term "U.S. person" has the meaning given to it by Regulation S under the Act. As used herein, "United States" means the United States of America (including the States and the District of Columbia); and its "possessions" include Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana Islands. We undertake to advise you promptly by tested telex on or prior to the date on which you intend to submit your certification relating to the Securities held by you for our account in accordance with your documented procedures if any applicable statement herein is not correct on such date, and in the absence of any such notification it may be assumed that this certification applies as of such date. 23 This certification excepts and does not relate to (Euro) [ ] of such interest in the above Securities in respect of which we are not able to certify and as to which we understand exchange and delivery of definitive Securities (or, if relevant, exercise of any rights or collection of any interest) cannot be made until we do so certify. We understand that this certification is required in connection with certain tax laws and, if applicable, certain securities laws of the United States. In connection therewith, if administrative or legal proceedings are commenced or threatened in connection with which this certification is or would be relevant, we irrevocably authorize you to produce this certification to any interested party in such proceedings. *Dated By ____________________________ Qualified Account Holder __________________________ * To be dated no earlier than the date to which this certification relates, namely (a) payment date or (b) the date set for the exchange of the temporary Global Note for an interest in the permanent Global Note. 24 SCHEDULE 1 PART 2 FORM OF THE PERMANENT GLOBAL NOTE DANAHER CORPORATION (incorporated under the laws of the State of Delaware) PERMANENT GLOBAL NOTE (Euro)300,000,000 6 1/4 percent Notes due 2005 This permanent Global Note is issued in respect of the (Euro)300,000,000 6 1/4 percent Notes due 2005 (the "Notes") of Danaher Corporation (the "Issuer"). The Notes are initially represented by a temporary Global Note, interests in which will be exchanged in accordance with the terms of the temporary Global Note for interests in this permanent Global Note and, if applicable, Definitive Notes. The Notes are issued subject to and with the benefit of a Fiscal Agency Agreement (the "Fiscal Agency Agreement") dated July 25, 2000 between, inter alios, the Issuer and Deutsche Bank AG London as Fiscal Agent (the "Fiscal Agent"). The Notes are issued subject to and with the benefit of the Terms and Conditions of the Notes (the "Conditions") set out in Part 2 of Schedule 2 to the Fiscal Agency Agreement. 1. Promise To Pay Subject as provided in this permanent Global Note, the Issuer, for value received, promises to pay the bearer upon presentation and surrender of this permanent Global Note such sum as is equal to the principal amount of the Notes represented by this permanent Global Note as shown by the latest entry in Part I, Part II or Part III of the Schedule to this permanent Global Note on July 26, 2005 or on such earlier date as the principal of this permanent Global Note may become due under the Conditions and to pay interest on the principal sum for the time being outstanding at the rate of 6 1/4 percent per annum from July 26, 2000 payable annually in arrears on July 26 in each year until payment of the principal sum has been made or duly provided for in full together with any other amounts as may be payable, all subject to and under the Conditions. 2. Exchange Of Interests In The Temporary Global Note For Interests In This Permanent Global Note Upon any exchange of an interest in the temporary Global Note representing the Notes for an interest in this permanent Global Note, the Fiscal Agent shall make the appropriate entry in Part I of the Schedule to this permanent Global Note in order to indicate the principal amount of Notes represented by this permanent Global Note following such exchange. 3. Exchange For Definitive Notes And Cancellations This permanent Global Note will be exchangeable in whole but not in part (free of charge to the holder) for Definitive Notes only (i) so long as an Event of Default has occurred and is continuing, (ii) if either Morgan Guaranty Trust Company of New York, Brussels office, as operator of Euroclear System ("Euroclear") or Clearstream Banking, societe anonyme, 25 Luxembourg ("Clearstream, Luxembourg") is closed for business period for a continuous period of 14 days (other than by reason of holiday, statutory or otherwise) or announces an intention permanently to cease business or does in fact do so and no alternative clearing system satisfactory to the Fiscal Agent is available, (iii) if the Issuer would suffer a disadvantage as a result of a change in laws or regulations (taxation or otherwise) or as a result of a change in the practice of Euroclear and/or Clearstream, Luxembourg which would not be suffered were the Notes in definitive form and a certificate to such effect signed by two Directors of the Issuer is given to the Fiscal Agent or (iv) at the option of an Accountholder (as defined below), such option to be exercisable by the giving of instructions to that effect by the Accountholder to the holder of the permanent Global Note. Thereupon (in the case of (i) and (ii) above) the holder of this permanent Global Note (acting on the instructions of (an) Accountholder(s) (as defined below)) may or (in the case of (iv) above) shall give notice to the Fiscal Agent and the Issuer, and (in the case of (iii) above) the Issuer may give notice to the Fiscal Agent and the Noteholders, of its intention to exchange this permanent Global Note for Definitive Notes on or after the Exchange Date (as defined below). On or after the Exchange Date the holder of this permanent Global Note may or, in the case of (iii) and (iv) above, shall surrender this permanent Global Note to or to the order of the Fiscal Agent. In exchange for this permanent Global Note the Issuer will deliver, or procure the delivery of, an equal aggregate principal amount of Definitive Notes in the denominations of (Euro)1,000, (Euro)10,000 and (Euro)100,000 (having attached to them all Coupons in respect of interest which has not already been paid on this permanent Global Note), security printed in accordance with any applicable legal and stock exchange requirements and in or substantially in the form set out in Part 1 of Schedule 2 to the Fiscal Agency Agreement. On exchange of this permanent Global Note, the Issuer will ensure that this permanent Global Note is cancelled. "Exchange Date" means a day specified in the notice requiring exchange falling not less than 45 days after that on which such notice is given and on which banks are open for business in the city in which the specified office of the Fiscal Agent is located and in the city in which the relevant clearing system is located. Upon receipt of instructions from Euroclear or Clearstream, Luxembourg that, following the purchase by or on behalf of the Issuer of the whole or a part of this permanent Global Note, part is to be cancelled, the portion of the principal amount of this permanent Global Note so cancelled shall be entered by or on behalf of the Fiscal Agent on Part II of the Schedule to this permanent Global Note, whereupon the principal amount of this permanent Global Note shall be reduced for all purposes by the amount so cancelled and entered. 4. Benefits Until the entire principal amount of this permanent Global Note has been extinguished in exchange for Definitive Notes or in any other manner envisaged by the Conditions, this permanent Global Note shall in all respects be entitled to the same benefits as the Definitive Notes referred to above. 5. Payments Payments due in respect of Notes for the time being represented by this permanent Global Note shall be made to the bearer of this permanent Global Note. 26 Upon any payment in respect of the Notes represented by this permanent Global Note, the amount so paid shall be endorsed by or on behalf of the Fiscal Agent on Part III of the Schedule to this permanent Global Note, which endorsement shall, in the absence of manifest error, be prima facie evidence that such payment has been made in respect of the Notes. In the case of any payment of principal the principal amount of this permanent Global Note shall be reduced for all purposes by the amount so paid and the remaining principal amount of this permanent Global Note shall be entered by or on behalf of the Fiscal Agent on Part III of the Schedule to this permanent Global Note. 6. Accountholders For so long as any of the Notes is represented by this permanent Global Note and this permanent Global Note is held on behalf of Euroclear and/or Clearstream, Luxembourg, each person who is for the time being shown in the records of Euroclear and/or Clearstream, Luxembourg as the holder of a particular principal amount of Notes (each an "Accountholder") (in which regard any certificate or other document issued by Euroclear or Clearstream, Luxembourg as to the principal amount of such Notes standing to the account of any person shall be conclusive and binding for all purposes) shall be treated as the holder of that principal amount of such Notes for all purposes (including for the purposes of any quorum requirements of, or the right to demand a poll at, meetings of the Noteholders) other than with respect to the payment of principal and interest on such Notes, the right to which shall be vested, as against the Issuer and the Paying Agents, solely in the bearer of this permanent Global Note in accordance with and subject to its terms. Each Accountholder must look solely to Euroclear or Clearstream, Luxembourg, as the case may be, for its share of each payment made to the bearer of this permanent Global Note. Notes represented by this permanent Global Note are transferable in accordance with the rules and procedures for the time being of Euroclear or Clearstream, Luxembourg as appropriate. The Issuer covenants in favour of each Accountholder that it will make all payments in respect of the Notes for the time being shown in the records of Euroclear and/or Clearstream, Luxembourg as being held by the Accountholder and represented by this permanent Global Note to the bearer of this permanent Global Note in accordance with clause 1 above and acknowledges that each Accountholder may take proceedings to enforce this covenant and any of the other rights which it has under the first paragraph of this clause directly against the Issuer. 7. Notices Notices to be given by the Issuer will be given at least once by publication in a daily newspaper in the English language with general circulation in London, England, and, so long as the Notes are listed on the Luxembourg Stock Exchange and the rules of the Luxembourg Stock Exchange so require, in a daily newspaper of general circulation in Luxembourg. If publication in London or Luxembourg is impractical, notices shall be published by such means as will, so far as may be reasonably practicable, approximate publication in such newspaper. Publication is expected to be made in the Luxemburger Wort in Luxembourg and the Financial Times in London. Such notices will be deemed to have been given on the date of such publication or, if published more than once, on the date of the first such publication. For so long as any of the Notes are represented by this permanent Global Note and/or the temporary Global Note and this permanent Global Note and/or the temporary Global Note is/are held on behalf of Euroclear and/or Clearstream, Luxembourg, notices may he given by delivery of the relevant notice to Euroclear and/or Clearstream, Luxembourg (as the case may be) for 27 communication to the relative Accountholders rather than by publication as required in the preceding paragraph provided that, so long as the Notes are listed on the Luxembourg Stock Exchange, and the rules of that stock exchange so require, notices to Noteholders will be published in one daily newspaper in Luxembourg (which is expected to be the Luxemburger Wort. Any such notice shall be deemed to have been given to the Noteholders on the day after such notice is delivered to Euroclear and/or Clearstream, Luxembourg (as the case may be) as aforesaid or the date of publication, whichever is earlier. 8. Prescription Claims against the Issuer in respect of principal and interest on the Notes represented by this permanent Global Note will be prescribed after 10 years (in the case of principal) and five years (in the case of interest) from the Relevant Date (as defined in Condition 4). 9. Cancellation Cancellation of any Note represented by this permanent Global Note will be effected by endorsement by or on behalf of the Fiscal Agent of the reduction in the principal amount of this permanent Global Note on Part II of the Schedule hereto. 10. Authentication This permanent Global Note shall not become valid or enforceable for any purpose unless and until it has been authenticated by or on behalf of the Fiscal Agent. 11. Governing Law This permanent Global Note is governed by, and shall be construed in accordance with, the laws of the State of New York. 28 IN WITNESS whereof the Issuer has caused this permanent Global Note to be duly executed under its corporate seal to be affixed or imported hereon. DANAHER CORPORATION By: ________________________________ Name: ________________________________ Title: ________________________________ Attest: ________________________________ Name: ________________________________ Title: ________________________________ Issued on July __, 2000 CERTIFICATE OF AUTHENTICATION This is the permanent Global Note described in the Fiscal Agency Agreement By or on behalf of Deutsche Bank AG London, as Fiscal Agent (without recourse, warranty or liability) By: ________________________________ Authorized Signatory ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE. 29 THE SCHEDULE TO THE PERMANENT GLOBAL NOTE Part I EXCHANGES OF THE TEMPORARY GLOBAL NOTE The following exchanges of part of the temporary Global Note for interests in this permanent Global Note have been made:
Date of exchange Part of aggregate Aggregate principal amount Notation made by or on principal amount of the of Notes represented by behalf of the Fiscal Agent temporary Global Note this permanent Global Note exchanged for this following exchange permanent Global Note (Euro) (Euro) _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________
30 Part II CANCELLATIONS The following cancellations of a part of the aggregate principal amount of this permanent Global Note have been made:
Date of cancellation Part of the aggregate Remaining principal amount Notation made by or on principal amount of this of this permanent Global behalf of the Fiscal Agent permanent Global Note Note following cancellation cancelled (Euro) (Euro) _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________
31 Part III PAYMENTS The following payments in respect of the Notes represented by this permanent Global Note have been made:
Date of payment Amount of interest Amount of principal Remaining principal Notation made by or paid paid amount of this on behalf of the permanent Global Fiscal Agent Note following payment of principal (Euro) (Euro) (Euro) ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________ ______________
32 SCHEDULE 2 PART 1 FORM OF DEFINITIVE NOTE AND COUPON (Face of Note) ________________________________________________________________________________ XSO114750515 011475051 ________________________________________________________________________________ DANAHER CORPORATION (incorporated under the laws of the State of Delaware) (Euro)300,000,000 6 1/4 percent Notes due 2005 The issue of the Notes was authorized by a resolution of the board of directors of Danaher Corporation (the "Issuer") passed on June 2, 2000. This Note forms one of a series of Notes issued as bearer Notes in the denominations of (Euro)1,000, (Euro)10,000 and (Euro)100,000, each in an aggregate principal amount of (Euro)300,000,000. The Issuer for value received and subject to and in accordance with the Terms and Conditions endorsed hereon (the "Conditions") hereby promises to pay to the bearer on July 26, 2005 (or on such earlier date as the principal sum may become repayable under the said Conditions) the principal sum of: (Euro)[1,000]/[10,000]/(100,000] together with interest on the principal sum of (Euro) [1,000]/[10,000]/[100,000] at the rate of 6 1/4 percent per annum payable annually in arrears on July 26 in each year and together with such other amounts as may be payable, all subject to and under the Conditions. The Notes are issued pursuant to a Fiscal Agency Agreement (the "Fiscal Agency Agreement") dated July 25, 2000 between, inter alios, the Issuer and Deutsche Bank AG London as Fiscal Agent. The Notes have the benefit of, and are subject to, the provisions contained in the Fiscal Agency Agreement and the Conditions. Neither this Note nor any of the Coupons relating to this Note shall become valid or enforceable for any purpose unless and until this Note has been authenticated by or on behalf of the Fiscal Agent. 33 IN WITNESS WHEREOF this Note has been executed on behalf of the Issuer. Dated as of July __, 2000 Issued in London, England. Danaher Corporation By: - ------------------------------------- CERTIFICATE OF AUTHENTICATION This is one of the Notes described in the Fiscal Agency Agreement. By or on behalf of Deutsche Bank AG London, as Fiscal Agent (without recourse, warranty or liability) - ------------------------------------- ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE. 34 (Reverse of Note) CONDITIONS OF THE NOTES (as set out in Part 2 of this Schedule 2) FISCAL AND PRINCIPAL PAYING AGENT Deutsche Bank AG London Winchester House 1 Great Winchester Street London EC2N 2DB THE OTHER PAYING AGENT Deutsche Bank Luxembourg S.A. 2 Boulevard Konrad Adenauer L-1115 Luxembourg UBS AG Bahnhofstrasse 45 CH-8098 Zurich Switzerland and/or such other or further Fiscal Agent or Paying Agents and/or specified offices as may from time to time be appointed by the Issuer and notice of which has been given to the Noteholders. 35 - FORM OF COUPON - (Face of Coupon) Danaher Corporation (Euro)300,000,000 6 1/4 percent Notes due 2005 This Coupon relating to a Note payable in the denomination of (Euro) [1,000]/[10,000]/[100,000] is payable to bearer, separately negotiable and subject to the Conditions of the Notes Coupon for (Euro)[62.5]/[625]/[6,250] due on 20__ ANY UNITED STATES PERSON WHO HOLDS THIS OBLIGATION WILL BE SUBJECT TO LIMITATIONS UNDER THE UNITED STATES INCOME TAX LAWS INCLUDING THE LIMITATIONS PROVIDED IN SECTIONS 165(j) AND 1287(a) OF THE INTERNAL REVENUE CODE. ________________________________________________________________________________ XSO114750515 011475051 ________________________________________________________________________________ 36 (Reverse of Coupon) FISCAL AND PRINCIPAL PAYING AGENT: Deutsche Bank AG London Winchester House 1 Great Winchester Street London EC2N 2DB THE OTHER PAYING AGENTS: Deutsche Bank Luxembourg S.A. 2 Boulevard Konrad Adenauer L-1115 Luxembourg UBS AG Bahnhofstrasse 45 CH-8098 Zurich Switzerland 37 SCHEDULE 2 PART 2 CONDITIONS OF THE NOTES The Notes are issued pursuant to a Fiscal Agency Agreement dated July 25, 2000 (the "Fiscal Agency Agreement") among the Issuer, Deutsche Bank AG London as fiscal agent (in such capacity, the "Fiscal Agent," which expression shall include any successors thereto), and the paying agents named therein (together with the Fiscal Agent, the "Paying Agents," which expression shall include any successors thereto). The statements in these Terms and Conditions include summaries of, and are subject to, the detailed provisions of the Fiscal Agency Agreement, which includes the form of the Notes, the interest coupons appertaining to any definitive Notes (the "Coupons") and which also includes provisions that are not summarized herein. Copies of the Fiscal Agency Agreement are available for inspection during normal business hours at the specified office of the Fiscal Agent and each of the other Paying Agents. The holders of the Notes (the "Noteholders") and holders of the Coupons (the "Couponholders") are entitled to the benefit of the Fiscal Agency Agreement and are deemed to have notice of all the provisions of the Fiscal Agency Agreement, which provisions are binding on such holders. 1. Form, Denomination and Title The Notes are in bearer form, and in the case of definitive Notes, serially numbered, in the denominations of (Euro)1,000, (Euro)10,000 and (Euro)100,000, with Coupons attached on issue. Title to the Notes and the Coupons will pass by delivery. The Issuer, the Fiscal Agent and any other Paying Agent may (to the fullest extent permitted by applicable law) treat any Noteholder or Couponholder as the absolute owner thereof (whether or not such Note or Coupon shall be overdue and notwithstanding any notice of ownership or writing thereon, any notice of previous loss or theft thereof, or any notice of any trust or other interest therein) for the purpose of making payment and for all other purposes. 2. Status The Notes will be senior unsecured obligations of the Issuer and will rank pari passu without preference among themselves, with other senior unsecured obligations of the Issuer, and will rank senior to all existing and future subordinated indebtedness of the Issuer. 3. Covenants (a) Limitation on Secured Debt The Issuer will not, and will not permit any Subsidiary to, create, assume, or guarantee any Secured Debt without making effective provision for securities by the Notes equally and ratably secured with such Secured Debt. The foregoing restrictions shall not apply, however, to debt secured to by: (1) purchase money mortgages created to secure payment for the acquisition or construction of any property including, but not limited to, any indebtedness incurred by the Issuer or a Subsidiary prior to, at the time of, or within 180 days after the later of the acquisition, the completion of construction (including any improvements on an existing property) or the commencement of commercial operation of such property, which indebtedness is 38 incurred for the purpose of financing all or any part of the purchase price of such property or construction or improvements on such property; (2) mortgages, pledges, liens, security interest or encumbrances (collectively referred to herein as "security interests") on property, or any conditional sales agreement or any title retention with respect to property, existing at the time of acquisition thereof, whether or not assumed by the Issuer or a Subsidiary; (3) security interests on property or shares of capital stock or indebtedness of any corporation or firm existing at the time such corporation or firm becomes a Subsidiary; (4) security interests in property or shares of capital stock or indebtedness of a corporation existing at the time such corporation is merged into or consolidated with the Issuer or a Subsidiary or at the time of a sale, lease, or other disposition of the properties of a corporation or firm as an entirety or substantially as an entirety to the Issuer or a Subsidiary, provided that no such security interests shall extend to any other Principal Property of the Issuer or such Subsidiary prior to such acquisition or to other Principal Property thereafter acquired other than additions or improvements to the acquired property; (5) security interests on property of the Issuer or a Subsidiary in favor of the United States of America or any state thereof, or in favor of any other country, or any department, agency, instrumentality or political subdivision thereof (including, without limitation, security interests to secure indebtedness of the pollution control or industrial revenue type) in order to permit the Issuer or any Subsidiary to perform a contract or to secure indebtedness incurred for the purpose of financing all or any part of the purchase price for the cost of constructing or improving the property subject to such security interests or which is required by law or regulation as a condition to the transaction of any business or the exercise of any privilege, franchise or license; (6) security interests on any property or assets of any Subsidiary to secure indebtedness owing by it to the Issuer or to another Subsidiary; (7) any mechanics', materialmen's, carriers' or other similar lien arising in the ordinary course of business (including construction of facilities) in respect of obligations which are not yet due or which are being contested in good faith; (8) any security interest for taxes, assessments or government charges or levies not yet delinquent, or already delinquent, but the validity of which is being contested in good faith; (9) any security interest arising in connection with legal proceedings being contested in good faith, including any judgment lien so long as execution thereof is being stayed; (10) landlords' liens on fixtures located on premises leased by the Issuer or a Subsidiary in the ordinary course of business; or (11) any extension, renewal or replacement (or successive extensions, renewals or replacements), in whole or in part, of any security interest referred to in the foregoing clauses (1) to (10) inclusive. 39 (b) Limitations on Sale and Leaseback Transactions The Issuer will not, and will not permit any Subsidiary to, enter any lease longer than three years (excluding leases of newly acquired, improved or constructed property) covering any Principal Property of the Issuer or any Subsidiary that is sold to any other person in connection with such lease (a "Sale and Leaseback Transaction"), unless either: (1) the Issuer or such Subsidiary would be entitled, without equally and ratably securing the Notes, to incur Indebtedness secured by a mortgage on the Principal Property leased pursuant to clauses (1) through (11) under Condition 3(a); or (2) an amount equal to the value of the Principal Property so leased is applied to the retirement, within 120 days of the effective date of such arrangement, of indebtedness for borrowed money incurred or assumed by the Issuer or a Subsidiary which is recorded as Funded Debt (defined to include the Notes and other long-term indebtedness of the Issuer or any Subsidiary) as shown on the most recent consolidated balance sheet of the Issuer and which in the case of such Indebtedness of the Issuer, is not subordinate and junior in right of payment to the prior payment of the Notes. (c) Exempted Indebtedness Notwithstanding Conditions 3(a) and 3(b), the Issuer and any one or more Subsidiaries may, without securing the Notes, issue, assume, or guarantee Secured Debt or enter into any Sale and Leaseback Transaction which would otherwise be subject to the foregoing restrictions, provided that, after giving effect thereto, the aggregate amount of such Secured Debt then outstanding (not including Secured Debt permitted under the exceptions set forth in Condition 3(a)) and the Attributable Debt of Sale and Leaseback Transactions (other than Sale and Leaseback Transactions in connection with clauses (1) or (2) in Condition 3(b)) at such time does not exceed 15% of Consolidated Net Assets. (d) Payment of Principal and Interest The Issuer covenants and agrees for the benefit of the Noteholders that it will duly and punctually pay the principal of and interest, if any, on the Notes in accordance with the terms of the Notes and these Conditions (e) Stay, Extension and Usury Laws The Issuer covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of these Conditions or the Notes and the Issuer (to the extent it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not by resort to any such law, hinder, delay or impede the execution of any power granted under the Fiscal Agency Agreement to the Fiscal Agent, but will suffer and permit the execution of every such power as though no such law has been enacted. 40 (f) Taxes The Issuer shall, and shall cause each of its Significant Subsidiaries to, pay prior to delinquency all their respective taxes, assessments and governmental levies, except as contested in good faith and by appropriate proceedings. 4. Definitions For the purpose of these Conditions: "Attributable Debt" means in respect of a Sale and Leaseback Transaction, as of any particular time, the present value (discounted at the rate of interest implicit in the lease involved in such Sale and Leaseback Transaction, as determined in good faith by the Issuer) of the obligation of the lessee thereunder for rental payments (excluding, however, any amounts required to be paid by such lessee, whether or not designated as rent or additional rent, on account of maintenance and repairs, insurance, taxes, assessments, water rates or similar charges or any amounts required to be paid by such lessee thereunder contingent upon the amount of sales, maintenance and repairs, insurance, taxes, assessments, water rates or similar charges) during the remaining term of such lease (including any period for which such lease has been extended or may, at the option of the lessor, be extended). "Consolidated Assets" means the aggregate of all assets of the Issuer and its Subsidiaries (including the value of all existing Sale and Leaseback Transactions and any assets resulting from the capitalization of other long-term lease obligations in accordance with GAAP), appearing on the most recent available consolidated balance sheet of the Issuer and its Subsidiaries at their net book values, after deducting related depreciation, amortization and other valuation reserves, all prepared in accordance with GAAP. "Consolidated Current Liabilities" means the aggregate of the current liabilities of the Company and its Subsidiaries appearing on the most recent available consolidated balance sheet of the Company and its Subsidiaries, all in accordance with GAAP. In no event shall Consolidated Current Liabilities include any obligation of the Company and its Subsidiaries issued under a revolving credit or similar agreement if the obligation issued under such agreement matures by its terms within twelve months from the date thereof but by the terms of such agreement such obligation may be renewed or extended or the amount thereof reborrowed or refunded at the option of the Company or any Subsidiary for a term in excess of 12 months from the date of determination. "Consolidated Current Liabilities," means the aggregate of the current liabilities of the Issuer and its Subsidiaries appearing on the most recent available consolidated balance sheet of the Issuer and its Subsidiaries, all in accordance with GAAP. In no event shall Consolidated Current Liabilities include any obligation of the Issuer and its Subsidiaries issued under a revolving credit or similar agreement if the obligation issued under such agreement matures by its terms within 12 months from the date thereof but by the terms of such agreement such obligation may be renewed or extended or the amount thereof reborrowed or refunded at the option of the Issuer or any Subsidiary for a term in excess of 12 months from the date of determination. "Consolidated Net Assets" means Consolidated Assets after deduction of Consolidated Current Liabilities. 41 "Default" means any event which is, or after notice or passage of time would be, an Event of Default; "Funded Debt" means all indebtedness for money borrowed having a maturity of more than twelve months from the date of the most recent consolidated balance sheet of the Issuer and its Subsidiaries or renewable and extendable beyond twelve months at the option of the borrower and all obligations in respect of lease rentals which under GAAP would be shown on the consolidated balance sheet of the Issuer as a liability item other than a current liability; provided, however, that Funded Debt shall not include any of the foregoing to the extent that such indebtedness or obligations are not required by GAAP to be shown on the balance sheet of the Issuer. "Indebtedness" means, with respect to a Person, (i) all liabilities representing borrowed money or purchase money obligations as shown on the liability side of a balance sheet, (ii) all indebtedness secured by any Lien existing on property owned subject to such Lien, whether or not such secured indebtedness has been assumed and (iii) contingent obligations in respect of, or to purchase or otherwise acquire, any such indebtedness of others described in the foregoing clauses (i) or (ii) above, including guarantees and endorsements (other than for purposes of collection in the ordinary course of business of any such indebtedness). "Lien" means, with respect to any property or assets, any mortgage or deed of trust, pledge, hypothecation, assignment, security interest, lien or other security arrangement of any kind or nature whatsoever on or with respect to such property or assets (including any conditional sale or other title retention agreement having substantially the same economic effect as any of the foregoing). "Person" means any individual, corporation, partnership, joint venture, association, limited liability company, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. "Principal Property" means any manufacturing plant, warehouse, office building or parcel of real property (including fixtures but excluding leases and other contract rights which might otherwise be deemed real property) owned by the Issuer or any Subsidiary, whether owned at the date of issue of the Notes or thereafter, provided each such plant, warehouse, office building or parcel of real property has a gross book value (without deduction for any depreciation reserves) at the date as of which the determination is being made of in excess of two percent of the Consolidated Net Assets of the Issuer and the Subsidiaries, other than any such plant, warehouse, office building or parcel of real property or portion thereof which, in the opinion of the Board of Directors of the Issuer (evidenced by a certified Board Resolution), is not of material importance to the business conducted by the Issuer and its Subsidiaries taken as a whole. "Relevant Date" means (i) the date on which payment on any Note or Coupon first becomes due or (ii) if payment to the Fiscal Agent on or prior to such due date is improperly withheld or refused, the date on which all moneys then due for payment shall have been so received and notice to that effect shall have been duly given in accordance with "Condition 15" below. "Secured Debt" means Indebtedness for borrowed money and any Funded Debt which is secured by a security interest in (a) any Principal Property or (b) any shares of capital stock or Indebtedness of any Subsidiary. 42 "Significant Subsidiary" means any direct or indirect Subsidiary of the Issuer that would be a "significant subsidiary" as defined in Article I, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act of 1933, as amended, as such regulation is in effect on the date hereof. "Subsidiary" of any specified Person means any corporation or other entity (including, without limitation, partnerships, joint ventures and associations) of which at least a majority of the outstanding stock having by the terms thereof ordinary voting power for the election of directors of such corporation or other entity (irrespective of whether or not at the time stock of any other class or classes of such corporation shall have or might have voting power by reason of the happening of any contingency) is at the time directly or indirectly owned by such Person, or by one or more Subsidiaries, or by such Persons and one or more other Subsidiaries. 5. Successor (a) Merger The Issuer may not merge or consolidate with, or sell, lease or convey all or substantially all of its assets to any other corporation, unless: (1) the successor entity is a corporation, partnership or trust organized and existing under the laws of the United States, any State or the District of Columbia and such entity shall expressly assume the due and punctual payment of the principal of (and premium, if any) and interest on all the Notes, according to their terms, and the due and punctual performance and observance of all the covenants and conditions of the Notes to be performed by the Issuer; and (2) immediately after giving effect to the transaction, no Default shall have occurred and be continuing. (b) Successor Corporation Substituted Upon any consolidation or merger, or any sale, lease, conveyance or other disposition of all or substantially all of the assets of the Issuer in accordance with Condition 5(a), the successor corporation formed by such consolidation or into or with which the Issuer is merged or to which such sale, lease, conveyance or other disposition is made shall succeed to, and be substituted for, and may exercise every right and power of, the Issuer under this Agreement with the same effect as if such successor person has been named as the Issuer herein; provided, however, that the predecessor Issuer in the case of a sale, lease, conveyance or other disposition shall not be released from the obligation to pay the principal of and interest, if any, on the Notes. 6. Interest (a) Interest on the Notes will be payable in arrears on July 26 of each year until maturity (each, an "annual interest payment date"), beginning July 26, 2001. The Notes will bear interest at the rate of 6" percent per annum. Interest on the Notes payable on each annual interest payment date will include interest accrued from and including July 26, 2000 (the "Issue Date") or from and including the most recent date to which interest has been paid or duly provided for to but excluding the next annual interest payment date, including the maturity date. 43 (b) Interest on the Notes that is required to be calculated for a period of less than one year will be calculated on the basis of the actual number of days elapsed divided by the actual number of days in the period from and including the immediately preceding annual interest payment date to but excluding the next annual interest payment date. 7. Redemption and Purchase (a) Redemption at Maturity Unless earlier redeemed or purchased and cancelled as provided below, the Issuer will redeem the Notes at their principal amount on July 26, 2005. (b) Redemption for Taxation Reasons Except as set forth hereunder, the Notes may not be redeemed prior to maturity. If (a) as a result of any change in, or amendment to, the laws (or any regulations or rulings promulgated thereunder) of the United States (or any political subdivision or taxing authority thereof or therein), or any change in, or amendment to, the official position regarding the application or interpretation of such laws, regulations or rulings, which change or amendment is announced or becomes effective on or after July 25, 2000, the Issuer becomes or will become obligated to pay additional amounts as described herein under the heading "Payment of Additional Amounts" or (b) any act is taken by a taxing authority of the United States on or after July 25, 2000, whether or not such act is taken with respect to the Issuer or any affiliate, that results in a substantial probability that the Issuer will or may be required to pay such additional amounts, then the Issuer may, at its option, redeem the Notes, as a whole but not in part, upon not less than 35 days' nor more than 60 days' published notice in accordance with "Notices" below at 100% of their principal amount together with interest accrued thereon to the respective date fixed for redemption; provided that the Issuer determines in its business judgment, that the obligation to pay such additional amounts cannot be avoided by the use of reasonable measures available to the Issuer, not including substitution of the obligor under the Notes. No redemption pursuant to (b) above may be made unless the Issuer shall have received an opinion of independent counsel to the effect that an act taken by a taxing authority of the United States results in a substantial probability that it will or may be required to pay the additional amounts described herein under the heading "Payment of Additional Amounts" and the Issuer shall have delivered to the Fiscal Agent a certificate, signed by a duly authorized officer, stating that based on such opinion the Issuer is entitled to redeem the Notes pursuant to their terms. (c) Purchase The Issuer may at any time purchase Notes (provided that all unmatured Coupons related thereto are attached or surrendered therewith) in the open market or by tender or by private agreement at any price. Such Notes may be held, resold or, at the option of the Issuer, surrendered to any Paying Agent for cancellation. 44 (d) Cancellation All Notes redeemed pursuant to the provisions of this Condition will be cancelled forthwith, together with all unmatured Coupons surrendered therewith, and may not be resold or reissued. 8. Payment (a) Payments of the principal and interest in respect of each Note and Coupon will be made in euro against presentation and surrender (or, in the case of part payment only, endorsement) of such Note or Coupon (subject as provided below), as the case may be, at the office of any Paying Agent outside the United States and its possessions. Such payments will be made, at the option of the holder, by euro cheque or by credit of or transfer to a designated euro account subject in all cases to any fiscal or other laws and regulations applicable in the place of payment, but without prejudice to the provisions under the heading "Payment of Additional Amounts." No payment with respect to any Note or Coupon will be made at any office of a Paying Agent located in the United States or its possessions, nor will any payment be made by transfer to an account maintained in the United States. Each definitive Note shall be presented for payment together with all related unmatured Coupons, failing which the amount of any missing unmatured Coupon will be deducted from the sum due for payment. Any amount so deducted will be paid in the manner mentioned above against surrender of the relevant missing Coupons within a period ending 10 years from the Relevant Date (as defined under the heading "Prescription") in respect of the Note to which such Coupon appertained. If any day for payment of principal or interest in respect of any Note or Coupon is not a Business Day (as defined below), the holder shall not be entitled to payment until the next Business Day following such day in such place or to any interest or other sums in respect of such postponed payment. If the date for redemption of a Note is not an annual interest payment date, the accrued interest from the previous annual interest payment date or the Issue Date, as the case may be, shall be payable only against presentation of such Note. "Business Day" means a day which is both a day on which commercial banks and foreign exchange markets settle payments in the place where the specified office of the Paying Agent to which the Note or Coupon is surrendered for payment is located and a day on which the Trans-European Automated Real-Time Gross Settlement Express Transfer System or any successor thereto is operating. (b) The Issuer reserves the right to terminate the appointment of the Fiscal Agent and any Paying Agent, to vary the appointment of the Fiscal Agent and/or any Paying Agent, and to appoint additional or other Paying Agents provided that it will, so long as any of the Notes remains outstanding, always maintain a Paying Agent having a specified office in a city in western Europe which, so long as the Notes are listed on the Luxembourg Stock Exchange, will be in Luxembourg. Not less than 30 nor more than 45 days' prior notice (except in the case of termination by reason of the insolvency or default of the Fiscal Agent or any Paying Agent, when such notice shall be effective forthwith) of any such termination, variation or appointment, or any changes in the specified office of the Fiscal Agent or any of the other Paying Agents, will be given to the Noteholders in accordance with "Condition 15." 45 9. Payment of Additional Amounts All payments of principal and interest in respect of the Notes and Coupons by the Issuer will be made without withholding or deduction for or on account of any present or future taxes, duties, assessments or governmental charges of whatever nature imposed, levied, withheld or assessed by or within the United States or any political subdivision or any authority thereof or therein having power to tax, unless such withholding or deduction is required by law. In such event the Issuer will, subject to the exceptions and limitations set forth below, pay as additional interest on the Notes, such additional amounts as are necessary in order that the net payment by the Issuer or a paying agent of the principal of and interest on the Notes or the Coupons to a holder who is not a United States person (as defined below), after deduction for any present or future tax, assessment or governmental charge of the United States or a political subdivision or taxing authority thereof or therein, imposed by withholding with respect to the payment, will not be less than the amount provided in the Notes or any coupons to be then due and payable; provided, however, that the foregoing obligation to pay additional amounts shall not apply: (a) in respect of any Note or Coupon presented for payment by the holder of any Note or Coupon who is not a United States Alien (as defined herein): (b) to a tax, assessment or governmental charge that is imposed or withheld solely by reason of the holder, or a fiduciary, settlor, beneficiary, member or shareholder of the holder if the holder is an estate, trust, partnership or corporation, or a person holding a power over an estate or trust administered by a fiduciary holder, being considered as: (i) being or having been present or engaged in trade or business in the United States or having or having had a permanent establishment in the United States; (ii) having a current or former relationship with the United States, including a relationship as a citizen or resident thereof; (iii) a personal holding company, a foreign personal holding company with respect to the United States, a controlled foreign corporation or a passive foreign investment company for United States tax purposes or a corporation subject to the accumulated earnings tax; (iv) being or having been (i) a "10-percent shareholder" of the Issuer as defined in section 871(h)(3) of the United States Internal Revenue Code of 1986, as amended (the "Code") or (ii) such holder being a bank receiving interests described in Section 881(d)(3)(A) of the Code; or (c) to a tax, assessment or governmental charge that is imposed or withheld solely by reason of the payment being made in the United States on a Note or Coupon; (d) to a tax, assessment or governmental charge that is imposed or withheld solely by reason of the failure to comply with certification, identification or information reporting requirements concerning the nationality, residence, identity or connection with the United States of the holder or beneficial owner of such Note or any coupon appertaining thereto, if compliance is required by statute or by regulation of the United States Treasury Department or income tax treaty as a precondition to exemption from such tax, assessment or other governmental charge; 46 (e) to a tax, assessment or governmental charge that is imposed otherwise than by withholding by the Issuer or a paying agent from the payment; (f) to a tax, assessment or governmental charge that would not have been imposed or withheld but for the presentation by the holder of such Note or Coupon appertaining thereto for payment on a date more than 30 days after the Relevant Date (as defined herein); (g) in respect of any estate, inheritance, gift, sales, transfer, personal property or similar tax, assessment or governmental charge; (h) in respect of any tax, assessment or other governmental charge which is payable by a holder that is not the beneficial owner of the Note or Coupon, or a portion of either, or that is a foreign or fiduciary partnership, but only to the extent that a beneficial owner, settlor with respect to such fiduciary or member of the partnership would not have been entitled to the payment of such additional amounts had the beneficial owner or member received directly its beneficial or distributive share of the payment; (i) in respect of any tax assessment or other governmental charge required to be withheld by any paying agent from any payment of the principal of or interest on any Note or Coupon, if such payment can be made without such withholding by any other paying agent; or (j) in the case of any combination of items (a), (b), (c), (d), (e), (f), (g),(h) and (i). The Notes and Coupons are subject in all cases to any tax, fiscal or other law or regulation or administrative or judicial interpretation applicable thereto. Except as specifically provided under this heading and under the heading "Redemption for Taxation Reasons", the Issuer shall not be required to make any payment with respect to any tax, assessment or governmental charge imposed by any government or a political subdivision or taxing authority thereof or therein. As used in this Condition, the term "United States" means the United States of America (including the States and the District of Columbia) and its territories, its possessions and other areas subject to its jurisdiction and "United States person" means any individual who is a citizen or resident of the United States, a corporation, partnership or other entity created or organized in or under the laws of the United States or any estate or trust the income of which is subject to United States federal income taxation regardless of its source; provided, however, that elsewhere in the Fiscal Agency Agreement (and the schedules attached thereto) such terms shall have the meanings given to them by the United States Internal Revenue Code or Regulation S under the United States Securities Act of 1933, as amended, as applicable. 10. Events of Default If any one or more of the following events (each, an "Event of Default") shall occur: (a) default for 15 days in payment of any interest on the Notes; (b) failure to pay principal with respect to the Notes, if any, when due; 47 (c) default by the Issuer in the performance or observance of any other of the covenants in the Notes if such default continues for 60 days after written notice thereof by any Noteholder to the Issuer requiring the same to be continued; (d) any indebtedness of the Issuer or any of its Subsidiaries becomes due and repayable prematurely by reason of an event of default (however described) or the Issuer or any of its Subsidiaries fails to make any payment in respect of any indebtedness on the due date for payment (as extended by an originally applicable grace period) or any security given by the Issuer or any of its Subsidiaries for any indebtedness becomes enforceable or if default is made by the Issuer or any Subsidiary in making any payment due under any guarantee and/or indemnity given by it in relation to any indebtedness of any other person (as extended by any originally applicable grace period), provided, however, that no such event shall constitute an event of default unless the indebtedness relating to all such events which shall have occurred and be continuing whether individually or in the aggregate shall amount to at least $30,000,000 (or its equivalent in any other currency); or (e) the Issuer or any of its Significant Subsidiaries pursuant to or within the meaning of any Bankruptcy Law (i) commences a voluntary case, (ii) consents to the entry of an order for relief against it in an involuntary case, (iii) consents to the appointment of a Custodian of it or for all or substantially all of its property, (iv) makes a general assignment for the benefit of its creditors, or (v) generally is unable to pay its debts as the same become due; or (f) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that (i) is for relief against the Issuer or any of its Significant Subsidiaries in an involuntary case, (ii) appoints a Custodian of the Issuer or any of its Significant Subsidiaries or for all or substantially all of its property, or (iii) orders the liquidation of the Issuer or any of its Significant Subsidiaries, and the order or decree remains unstayed and in effect for 90 days; then any Noteholder may, by written notice to the Issuer at the specified office of the Fiscal Agent, effective upon the date of receipt thereof by the Fiscal Agent, declare the Note held by the holder to be forthwith due and payable whereupon the same shall become forthwith due and payable at par, together with accrued interest (if any) to the date of repayment, without presentment, demand, protest or other notice of any kind. The term "Bankruptcy Law" means Title 11, U.S. Code or any similar Federal or State law for the relief of debtors. The term "Custodian" means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law. 11. Prescription The Notes and Coupons will become void unless presented for payment within a period of 10 years (in the case of principal) and five years (in the case of interest) after the Relevant Date therefore. 12. Replacement of Notes and Coupons If any Note or Coupon is mutilated, defaced, destroyed, stolen, or lost, it may be replaced at the specified office of the Fiscal Agent, subject to all applicable laws and stock exchange requirements, upon payment by the claimant of such costs as may be incurred in connection 48 therewith and on such terms as to evidence and indemnity or otherwise as the Issuer and the Fiscal Agent may reasonably require. Mutilated or defaced Notes or Coupons must be surrendered before replacements will be issued. 13. Meetings of Noteholders, Modification and Waiver The Fiscal Agency Agreement contains provisions for convening meetings of the Noteholders to consider any matters affecting their interests, including the sanctioning of a modification of the Notes, the Coupons or any of the provisions of the Fiscal Agency Agreement. Such a meeting may be convened by the Issuer or Noteholders holding not less than 10 percent of the aggregate principal amount of the Notes then outstanding. The quorum at any such meeting is one or more persons holding or representing not less than 50 percent of the aggregate amount of the Notes then outstanding, or at any adjourned meeting 50 percent of the aggregate principal amount of the Notes then outstanding represented or held by the persons present at such previously adjourned meeting, except that at any such meeting the business of which includes the modifications of certain provisions of the Notes or the Coupons (including modifying the date of maturity of the Notes or at any date for payment of interest thereon, reducing or canceling the amount of principal or the rate of interest payable in respect of the Notes or altering the currency of payment of the Notes or the Coupons), the quorum should be one or more persons holding or representing not less than two-thirds of the aggregate principal amount of the Notes then outstanding, or at any adjourned such meeting one or more persons holding or representing not less than one-third in aggregate principal amount of the Notes then outstanding. A resolution passed at any meeting of the Noteholders shall be binding on all the Noteholders, whether or not they are present, and on all Couponholders. The Fiscal Agent and Issuer may agree, without the consent of the Noteholders or Couponholders, to (i) any modification (except as mentioned above) of the Fiscal Agency Agreement which is not prejudicial to the interests of the Noteholders, or (ii) any modification of the Notes, the Coupons or the Fiscal Agency Agreement which is of a formal, minor, or technical nature or is made to correct a manifest error or to comply with mandatory provisions of the law. Any such modification shall be binding on the Noteholders and the Couponholders and any such modification shall be notified to the Noteholders in accordance with the preceding paragraph as soon as practicable thereafter. 14. Fiscal Agent and Paying Agents In acting under the Fiscal Agency Agreement and in connection with the Notes and the Coupons, the Fiscal Agent and the other Paying Agents are acting solely as agents of the Issuer and do not assume any obligation towards, or relationship of agency or trust for or with, any Noteholder or Couponholder. The Fiscal Agency Agreement contains provisions for the indemnification of the Fiscal Agent and the other Paying Agents and for their relief from responsibility. The Fiscal Agent and the other Paying Agents are entitled to enter into business transactions with the Issuer without accounting for any profit. 15. Notices 49 (a) Notices to be given by the Issuer will be given at least once by publication in a daily newspaper in the English language with general circulation in London, England, and, so long as the Notes are listed on the Luxembourg Stock Exchange and the rules of the Luxembourg Stock Exchange so require, in a daily newspaper of general circulation in Luxembourg. If publication in London or Luxembourg is impractical, notices shall be published by such means as will, so far as may be reasonably practicable, approximate publication in such newspaper. Publication is expected to be made in the Luxemburger Wort in Luxembourg and the Financial Times in London. Such notices will be deemed to have been given on the date of such publication or, if published more than once, on the date of the first such publication. (b) For so long as all of the Notes are represented by one or both of the Global Notes and such Global Note(s) is/are held on behalf of Euroclear and/or Clearstream, Luxembourg, notices to holders of Notes represented by such Global Note(s) may be given by delivery of the relevant notice to Euroclear and/or Clearstream, Luxembourg (as the case may be) for communication to the relative Accountholders rather than by publication as required in (a) above provided that, so long as the Notes are listed on the Luxembourg Stock Exchange, and the rules of that stock exchange so require, notices to Noteholders will be published in one daily newspaper in Luxembourg (which is expected to be the Luxemburger Wort). Any such notice shall be deemed to have been given to the Noteholders on the day after such notice is delivered to Euroclear and/or Clearstream, Luxembourg (as the case may be) as aforesaid. 16. Further Issues The Issuer may, without notice to or the consent of the holders of the Notes, issue additional Notes of the same tenor as the Notes so that such additional Notes and the Notes offered hereby shall form a single series, and references herein to the Notes shall include (unless the context otherwise requires) any further Notes issued as described in this paragraph. 17. Governing Law The Fiscal Agency Agreement, the Notes and the Coupons will be governed by and construed in accordance with the laws of the State of New York. Any State or federal courts sitting in the Borough of Manhattan, The City of New York, shall have jurisdiction to settle any disputes which may arise out of or in connection with the Notes or the Coupons and accordingly any legal action or proceedings arising out of or in connection with the Notes or the Coupons (the "Proceedings") may be brought in such courts. The Issuer irrevocably submits to the jurisdiction of such courts and waives any objection which it may now or hereafter have to Proceedings in any such courts whether on the ground of the laying of venue or on the ground that the Proceedings have been brought in an inconvenient forum. This submission is made for the benefit of each of the Noteholders and Couponholders and shall not limit the right of any of them to take Proceedings in any other court of competent jurisdiction nor shall the taking of Proceedings in one or more jurisdictions preclude the taking of Proceedings in any other jurisdiction (whether concurrently or not). To the extent that the Issuer has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process with respect to itself or its property, the Issuer irrevocably waives such immunity in respect of its obligations under any Note or Coupon. 50 SCHEDULE 2 PROVISIONS FOR MEETINGS OF NOTEHOLDERS 1. Definitions In this Agreement and the Conditions, the following expressions have the following meanings: "Block Voting Instruction" means, in relation to any Meeting, a document in the English language issued by a Paying Agent: (a) certifying that certain specified Notes (the "Deposited Notes") have been deposited with such Paying Agent (or to its order at a bank or other depositary) or blocked in an account with a clearing system and will not be released until the earlier of: (i) the conclusion of the Meeting; and (ii) the surrender to such Paying Agent, not less than 48 hours before the time fixed for the Meeting (or, if the Meeting has been adjourned, the time fixed for its resumption), of the receipt for the deposited or blocked Notes and notification thereof by such Paying Agent to the Issuer; (b) certifying that the depositor of each deposited Note or a duly authorized person on its behalf has instructed the relevant Paying Agent that the votes attributable to such deposited Note are to be cast in a particular way on each resolution to be put to the Meeting and that, during the period of 48 hours before the time fixed for the Meeting, such instructions may not be amended or revoked; (c) listing the total number and (if in definitive form) the certificate numbers of the deposited Notes, distinguishing for each resolution between those in respect of which instructions have been given to vote for, or against, the resolution; and (d) authorizing a named individual or individuals to vote in respect of the deposited Notes in accordance with such instructions; "Chairman" means, in relation to any Meeting, the individual who takes the chair in accordance with paragraph 7; "Constitutive Quorum" means: (a) for voting on Ordinary Resolutions, more than half of the aggregate principal amount of the outstanding Notes; and (b) for voting on any Extraordinary Resolution, more than two-thirds of the aggregate principal amount of the outstanding Notes; provided, however, that, in the case of a Meeting which has resumed after adjournment for want of a quorum it means: (i) for voting on Ordinary Resolutions more than half of the aggregate principal amount of the Notes then outstanding represented or held by the Voters actually present at such previously adjourned Meeting; and 51 (ii) for voting on any Extraordinary Resolution more than one third of the aggregate principal amount of Notes outstanding. "Extraordinary Resolution" means a resolution passed at a duly convened Meeting passed by the favorable vote of one or more Voters holding or representing in the aggregate more than half of the aggregate principal amount of outstanding Notes; "Meeting" means a meeting of Noteholders (whether originally convened or resumed following an adjournment) convened to resolve an ordinary or extraordinary matters; "Ordinary Resolution" means any resolution for all business other than voting on an Extraordinary Resolution; "Proxy" means, in relation to any Meeting, a person appointed to vote under a Block Voting Instruction other than: (a) any such person whose appointment has been revoked and in relation to whom the Fiscal Agent has been notified in writing of such revocation by the time which is 48 hours before the time fixed for such Meeting; (b) any such person appointed to vote at a Meeting which has been adjourned for want of a quorum and who has not been re-appointed to vote at the Meeting when it is resumed; and (c) a director, auditor or employee of the Issuer or any of its controlled companies. "Voter" means, in relation to any Meeting, the bearer of a Voting Certificate, a Proxy or the bearer of a Definitive Note who produces such Definitive Note at the Meeting; "Voting Certificate" means, in relation to any Meeting, a certificate in the English language issued by a Paying Agent and dated in which it is stated: (a) that certain specified Notes (the "deposited Notes") have been deposited with such Paying Agent (or to its order at a bank or other depositary) or blocked in an account with a clearing system and will not be released until the earlier of: (i) the conclusion of the Meeting; and (ii) the surrender of such certificate to such Paying Agent; and (b) that the bearer of such certificate is entitled to attend and vote at the Meeting in respect of the deposited Notes; "Written Resolution" means a resolution in writing signed by or on behalf of all holders of Notes who for the time being are entitled to receive notice of a Meeting in accordance with the provisions of this Schedule, whether contained in one document or several documents in the same form, each signed by or on behalf of one or more such holders of the Notes; "24 hours" means a period of 24 hours including all or part of a day upon which banks are open for business in both the places where the relevant Meeting is to be held and in each of the places where the Paying Agents have their Specified Offices (disregarding for this purpose the day upon 52 which such Meeting is to be held) and such period shall be extended by one period or, to the extent necessary, more periods of 24 hours until there is included as aforesaid all or part of a day upon which banks are open for business as aforesaid; and "48 hours" means 2 consecutive periods of 24 hours. 2. Issue Of Voting Certificates And Block Voting Instructions The holder of a Note may obtain a Voting Certificate from any Paying Agent or require any Paying Agent to issue a Block Voting Instruction by depositing such Note with such Paying Agent or arranging for such Note to be (to its satisfaction) held to its order or under its control or blocked in an account with a clearing system not later than 48 hours before the time fixed for the relevant Meeting. A Voting Certificate or Block Voting Instruction shall be valid until the release of the deposited Notes to which it relates. So long as a Voting Certificate or Block Voting Instruction is valid, the bearer thereof (in the case of a Voting Certificate) or any Proxy named therein (in the case of a Block Voting Instruction) shall be deemed to be the holder of the Notes to which it relates for all purposes in connection with the Meeting. A Voting Certificate and a Block Voting Instruction cannot be outstanding simultaneously in respect of the same Note. 3. References To Deposit/Release Of Notes Where Notes are represented by the Temporary Global Note and/or the Permanent Global Note or are held in definitive form within a clearing system, references to the deposit, or release, of Notes shall be construed in accordance with the usual practices (including blocking the relevant account) of such clearing system. 4. Validity Of Block Voting Instructions A Block Voting Instruction shall be valid only if it is deposited at the specified office of the Fiscal Agent, or at some other place approved by the Fiscal Agent, at least 24 hours before the time fixed for the relevant Meeting or the Chairman decides otherwise before the Meeting proceeds to business. If the Fiscal Agent requires, a notarized copy of each Block Voting Instruction and satisfactory proof of the identity of each Proxy named therein shall be produced at the Meeting, but the Fiscal Agent shall not be obliged to investigate the validity of any Block Voting Instruction or the authority of any Proxy. 5. Convening Of Meeting The Issuer may convene a Meeting at any time. The Issuer shall be obliged to convene a Meeting upon the request in writing of Noteholders holding not less than one tenth of the aggregate principal amount of the outstanding Notes. 6. Notice At least 30 days' written notice (exclusive of the day on which the notice is given and of the day on which the relevant Meeting is to be held) specifying the date, time and place of the Meeting shall be given to the Noteholders and the Paying Agents (with a copy to the Issuer). The notice shall set out the full text of any resolutions to be proposed and shall state that the Notes may be deposited with, or to the order of, any Paying Agent for the purpose of obtaining Voting Certificates or appointing Proxies not later than 48 hours before the time fixed for the Meeting. 53 7. Chairman An individual (who may, but need not, be a Noteholder) nominated in writing by the Issuer may take the chair at any Meeting but, if no such nomination is made or if the individual nominated is not present within 15 minutes after the time fixed for the Meeting, those present shall elect one of themselves to take the chair failing which, the Issuer may appoint a Chairman. The Chairman of an adjourned Meeting need not be the same person as was the Chairman of the original Meeting. 8. Quorum A Meeting shall be deemed validly convened if at least one or more Voters representing or holding not less than the Constitutive Quorum are present at the Meeting provided, however, that, so long as at least the Constitutive Quorum of the aggregate principal amount of the outstanding Notes is represented by the Temporary Global Note and/or the Permanent Global Note, a single Proxy representing the holder thereof shall be deemed to be two Voters for the purpose of forming a quorum. 9. Adjournment for want of quorum If within 15 minutes after the time fixed for any Meeting a quorum is not present, then: (a) in the case of a Meeting requested by Noteholders, it shall be dissolved; and (b) in the case of any other Meeting, it shall be adjourned for such period (which shall be not less than 14 days and not more than 42 days) and to such place as the Chairman determines; provided, however, that: (i) the Meeting shall be dissolved if the Issuer so decides; and (ii) no Meeting may be adjourned more than once for want of a quorum. 10. Adjourned Meeting The Chairman may, with the consent of (and shall if directed by) any Meeting, adjourn such Meeting from time to time and from place to place, but no business shall be transacted at any adjourned Meeting except business which might lawfully have been transacted at the Meeting from which the adjournment took place. 11. Notice following adjournment Paragraph 6 shall apply to any Meeting which is to be resumed after adjournment for want of a quorum save that: (a) 10 days' notice (exclusive of the day on which the notice is given and of the day on which the Meeting is to be resumed) shall be sufficient; and (b) the notice shall specifically set out the quorum requirements which will apply when the Meeting resumes. It shall not be necessary to give notice of the resumption of a Meeting which has been adjourned for any other reason. 54 12. Participation The following may attend and speak at a Meeting: (a) Voters; (b) representatives of the Issuer and the Fiscal Agent; (c) the financial advisers of the Issuer; (d) the legal counsel to the Issuer and the Fiscal Agent; and (e) any other person approved by the Meeting. 13. Show of hands Every question submitted to a Meeting shall be decided in the first instance by a show of hands. Unless a poll is validly demanded before or at the time that the result is declared, the Chairman's declaration that on a show of hands a resolution has been passed, passed by a particular majority, rejected or rejected by a particular majority shall be conclusive, without proof of the number of votes cast for, or against, the resolution. 14. Poll A demand for a poll shall be valid if it is made by the Chairman, the Issuer or one or more Voters representing or holding not less than one fiftieth of the aggregate principal amount of the outstanding Notes. The poll may be taken immediately or after such adjournment as the Chairman directs, but any poll demanded on the election of the Chairman or on any question of adjournment shall be taken at the Meeting without adjournment. A valid demand for a poll shall not prevent the continuation of the relevant Meeting for any other business as the Chairman directs. 15. Votes Every Voter shall have one vote in respect of each Note held by him. In the case of a voting tie the Chairman shall have a casting vote. Unless the terms of any Block Voting Instruction state otherwise, a Voter shall not be obliged to exercise all the votes to which he is entitled or to cast all the votes which he exercises in the same way. 16. Validity of Votes by Proxies Any vote by a Proxy in accordance with the relevant Block Voting Instruction shall be valid even if such Block Voting Instruction or any instruction pursuant to which it was given has been amended or revoked, provided that the Fiscal Agent has not been notified in writing of such amendment or revocation by the time which is 24 hours before the time fixed for the relevant Meeting. Unless revoked, any appointment of a Proxy under a Block Voting Instruction in relation to a Meeting shall remain in force in relation to any resumption of such Meeting following an adjournment; provided, however, that no such appointment of a Proxy in relation to a Meeting originally convened which has been adjourned for want of a quorum shall remain in 55 force in relation to such Meeting when it is resumed. Any person appointed to vote at such a Meeting must be re-appointed under a Block Voting Instruction Proxy to vote at the Meeting when it is resumed. 17. Powers A duly convened Meeting shall have power (exercisable by either Ordinary Resolution or Extraordinary Resolution), without prejudice to any other powers conferred on it or any other person and in accordance with the provision of Clause 8: (a) To approve all business other than an Extraordinary Resolution, with a majority of at least one more than half of the Voters present at the Meeting, in first or second call; and (b) to approve any of the following Extraordinary Resolutions with a majority of one more than half of the aggregate principal amount of the outstanding Notes, at the first call or second call; (i) to change any date fixed for payment of principal or interest in respect of the Notes, to reduce the amount of principal or interest payable on any date in respect of the Notes or to alter the method of calculating the amount of any payment in respect of the Notes on redemption or maturity or the date for any such payment; (ii) to effect the exchange or substitution of the Notes for, or the conversion of the Notes into, shares, Notes or other obligations or securities of the Issuer or any other person or body corporate formed or to be formed; (iii) to change the currency in which amounts due in respect of the Notes are payable; (iv) to change the quorum required at any Meeting or the majority required to pass an Extraordinary Resolution; (v) to amend this definition; (vi) the substitution of any person for the Issuer (or any previous substitute) as principal obligor under the Notes and the Deed of Covenant; (vii) waiver to any breach or authorization of any proposed breach by the Issuer of its obligations under or in respect of the Notes or the Deed of Covenant or any act or omission which might otherwise constitute an event of default under the Notes; (vii) authorization of the Fiscal Agent or any other person to execute all documents and do all things necessary to give effect to any Extraordinary Resolution; (ix) any other authorization or approval which is required to be given by Extraordinary Resolution; (x) appointment of any persons as a committee to represent the interests of the Noteholders and to confer upon such committee any powers which the Noteholders could themselves exercise by Extraordinary Resolution; (xi) adopt a proposal for controlled administration or composition with creditors of the Issuer; (xii) create of a fund for the expenses incurred by the Noteholders in respect of the Notes; and (xiii) any matter of interest to the Noteholders. 18. Extraordinary Resolution binds all holders An Extraordinary Resolution shall be binding upon all Noteholders and holders of Coupons whether or not present at such Meeting and each of the Noteholders shall be bound to give effect to it accordingly. Notice of the result of every vote on an Extraordinary Resolution shall be given to the Noteholders and the Paying Agents (with a copy to the Issuer) within 14 days of the conclusion of the Meeting. 19. Minutes Minutes shall be made of all resolutions and proceedings at each Meeting. The Chairman shall sign the minutes, which shall be prima facie evidence of the proceedings recorded therein. Unless and until the contrary is proved, every such Meeting in respect of the proceedings of 56 which minutes have been summarized and signed shall be deemed to have been duly convened and held and all resolutions passed or proceedings transacted at it to have been duly passed and transacted. 20. Written Resolution A Written Resolution shall take effect as if it were an Extraordinary Resolution. 57 Please confirm that this letter correctly sets out the arrangements agreed between us. Yours faithfully, DEUTSCHE BANK AG LONDON By: /s/ Mark Jones /s/ Richard Tate ------------------------------------------------- Name: Mark Jones Richard Tate Title: Vice President Assistant Vice President DEUTSCHE BANK LUXEMBOURG S.A. By: /s/ Mark Jones ------------------------------------------------- Name: Mark Jones Title: Vice President UBS AG By: /s/ Mark Jones ------------------------------------------------- Name: Mark Jones Title: Vice President We agree to the foregoing. DANAHER CORPORATION By: /s/ Chris McMahon ------------------------------------------------- Name: Chris McMahon Title: V.P. and Controller 58 EX-10.I 3 dex10i.txt EXHIBIT 10.I Exhibit 10I EMPLOYMENT AGREEMENT THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into as of this 18th day of July, 2000 (the "Effective Date"), by and between Danaher Corporation, a Delaware corporation (the "Company"), and Henry Lawrence Culp, Jr. (the "Executive"). WHEREAS, the Company desires to employ the Executive, and the Executive desires to be employed by the Company, on the terms and conditions set forth herein. NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the parties hereto agree as follows: 1. Employment. On the terms and conditions set forth in this ---------- Agreement, the Company agrees to employ the Executive, and the Executive agrees to be employed by the Company, for the term set forth in Section 2 hereof and in the position and with the duties set forth in Section 3 hereof. 2. Term. The employment of the Executive by the Company as provided in ---- Section 1 hereof shall commence on the date of execution of this Agreement (the "Effective Date") and, unless sooner terminated as hereinafter set forth, shall end three (3) years thereafter; provided that, unless sooner terminated as -------- hereinafter set forth, the term of this Agreement shall be extended automatically for additional one (1) year periods on the second anniversary date of this Agreement and each subsequent anniversary date (the "Applicable Anniversary Notice Date"), unless and until either party provides written notice to the other party not less than ninety (90) days prior to the Applicable Anniversary Notice Date that the party is terminating this Agreement, which termination shall be effective as of the end of the initial term or extended term, as the case may be. 3. Position and Duties. The Executive shall serve as the Chief ------------------- Operating Officer of the Company, or in another position of equal or greater title, authority and responsibility, as assigned by the Chief Executive Officer of the Company or the board of directors of the Company (the "Board"), with duties and responsibilities as the Chief Executive Officer of the Company or the Board may from time to time determine and assign to the Executive. The Executive agrees to serve without additional compensation, if elected or appointed thereto, as a director of the Company and any of its subsidiaries and in one or more executive offices of any of the Company's subsidiaries, provided that the Executive is indemnified for serving in any and all director capacities on a basis no less favorable than is currently provided by the Company to any other director of the Company or any of its subsidiaries. The Executive shall devote the Executive's best efforts and full business time to the performance of the Executive's duties and the advancement of the business and affairs of the Company. 4. Place of Performance. In connection with the Executive's employment -------------------- by the Company, the Executive shall be based at the principal executive offices of the Company which the Company retains the right to change in its discretion or at such other place as the Company and the Executive mutually agree and subject to Section 9(c)(iv) hereof. 5. Compensation. ------------ (a) Base Salary. The Company shall pay to the Executive an annual ----------- base salary (the "Base Salary") at the rate of $600,000 per year. The Base Salary shall be reviewed for increases no less frequently than annually on the same basis as such salary reviews are made with respect to other executive officers of the Company. If the Executive's Base Salary is increased, the increased amount shall be the Base Salary for the remainder of the term of the Executive's employment hereunder. The Base Salary shall be payable biweekly or in such other installments as shall be consistent with the Company's payroll procedures. (b) Annual Bonus. During the first and each succeeding calendar ------------ year of the term, the Executive shall have a target bonus opportunity of 100% of the Executive's Base Salary, and a maximum bonus opportunity for extraordinary performance, expressed as a percentage of the target bonus opportunity, not less favorable than that provided for the Executive on the Effective Date, or for the President and Chief Executive Officer, following any appointment to that office, (the "Annual Bonus"). The amount of the Annual Bonus shall be determined by the Compensation Committee of the Board in its sole discretion, based upon the Company's achievement of pre-established, objective budgetary and other performance goals. For any year in which the Company has a shareholder approved bonus plan meeting the requirements of Section 162(m) of the Internal Revenue Code, such bonus shall be determined by such committee in a manner that will permit the Annual Bonus payable to the Executive to be fully deductible by the Company. The amount of each Annual Bonus shall be determined and paid not later than 15 days after the Company's earnings for the preceding fiscal year have been publicly announced. The Executive shall be entitled to a pro-rata portion of the target Annual Bonus for any calendar year (or fiscal year, if other than a calendar year) in which his termination of employment occurs except in the case of a termination for Cause pursuant to Section 9(b)(ii) or a termination by the Executive without Good Reason. (c) Other Benefits. The Company shall maintain in full force and -------------- effect, and the Executive shall be entitled to participate in, all of the employee -2- benefit and fringe benefit plans and arrangements in effect on the date hereof in which executives of the Company participate or plans or arrangements providing the Executive with at least equivalent benefits thereunder (including, without limitation, the Executive Deferred Incentive Program, and each group life insurance and accident plan, medical and dental insurance plans, and disability plan); provided, however, that, changes in such plans or arrangements may be made, including termination of such plans or arrangements if it occurs pursuant to a program applicable to all executives of the Company and does not result in a proportionately greater reduction in the rights of or benefits to the Executive as compared with any other executive of the Company. Notwithstanding any other provision of this sub-paragraph, during the term of the Executive's employment hereunder, the Company shall provide the Executive with term life insurance (which may include any group life insurance arrangement provided by the Company to its other employees), covering the Executive's life in a face amount each year equal to six times the Executive's base salary for such year through age fifty five, at which time the face amount of such insurance coverage may be decreased by the Company to four times the Executive's base salary (the "Age 55 Face Amount") and thereafter the face amount may be decreased by the Company by ten percent of the Age 55 Face Amount upon each birthday of the Executive thereafter. The Executive agrees to cooperate with the Company in obtaining such insurance, including submitting to a physical examination if required to do so by the insurance carrier. The beneficiary of this insurance will be designated by the Executive and if not so designated, the beneficiary will be his estate. Nothing paid to the Executive under any fringe plan or arrangement presently in effect or made available in the future shall be deemed to be in lieu of the salary payable to the Executive pursuant to Section 5(a). Any payments or benefits payable to the Executive hereunder in respect of any calendar year during which the Executive is employed by the Company for less than the entire such year shall, unless otherwise provided in the applicable plan or arrangement be pro-rated in accordance with the number of days in such calendar year during which he is so employed. (d) Vacation; Holidays. The Executive shall be entitled to all ------------------ public holidays observed by the Company and vacation days in accordance with the applicable vacation policies in effect for senior executives of the Company, which shall be taken at a reasonable time or times. (e) Relocation Assistance Loan. In addition to the Company's -------------------------- standard relocation package, a copy of which is attached as Exhibit 1, the Company shall lend to the Executive, on an interest-free basis, the sum of $500,000 (the "Loan") to assist him in meeting his relocation expenses, with the loan proceeds to be payable to the Executive within fourteen (14) days after the execution by the Executive of a Promissory Note substantially in the form attached as Exhibit 2. The Company shall also make lump-sum payments sufficient, after giving effect to all federal, state and other applicable taxes, to make the Executive whole for any taxes that might be incurred as a result of the making of, any imputation of interest -3- on, or forgiveness of, the Loan. The Executive agrees that in the event that his employment with the Company is terminated for Cause or without Good Reason prior to the third anniversary of the Effective Date, he shall repay to the Company a pro rata portion of the Loan based on the following formula: Amount of Loan Repayment = $500,000 x (1095 - Number of Days from the Effective Date until the Date of Termination) / 1095 Any repayment called for under this Section shall be made to the Company within fourteen (14) days of the Executive's Date of Termination; alternatively, at the Company's sole discretion, the loan repayment obligation may be satisfied, in whole or in part, by the Company offsetting that obligation against amounts owed to the Executive by the Company. If the Executive's employment continues beyond the third anniversary of the Effective Date, or if the Executive's employment is terminated prior to such date for any reason other than Cause or without Good Reason, then the Company shall forgive the Loan in its entirety as of the Date of Termination. (f) Withholding Taxes and Other Deductions. To the extent required -------------------------------------- by law, the Company shall withhold from any payments due Executive under this Agreement any applicable federal, state or local taxes and such other deductions as are prescribed by law or Company policy. (g) Club Memberships. During the term of the Executive's employment ---------------- hereunder, the Company shall reimburse the Executive for the cost of maintaining annual membership during the term in his existing club and the cost of joining and maintaining annual membership during the term in a club of his choosing located within the District of Columbia, or the suburban Maryland or Virginia area adjacent to the District of Columbia. (h) Tax and Financial Planning. During the term of the Executive's -------------------------- employment hereunder, the Company shall reimburse the Executive for the reasonable expenses incurred by the Executive in connection with obtaining professional tax and financial planning advice. (i) Annual Physical Examination. During the term of the Executive's --------------------------- employment hereunder, the Company shall reimburse the Executive for the reasonable expenses incurred by the Executive in undergoing an annual physical examination by a licensed physician. (j) Compensation During Disability. During any period that the ------------------------------ Executive fails to perform the Executive's duties hereunder as a result of incapacity due to physical or mental illness (the "Disability Period"), the Executive shall be treated as fully employed and shall continue to receive, or receive the benefit of (as -4- the case may be) all items described in Section 5 hereof at the rate then in effect for such period until his employment is terminated pursuant to Section 9(b)(i) hereof; provided, that payments made to the Executive during -------- the first 180 days of the Disability Period shall be reduced by the sum of the amounts, if any, payable to the Executive at or prior to the time of any payment under disability benefit plans of the Company and which amounts were not previously applied to reduce any payment. 6. Expenses. During the term of the Executive's employment hereunder, -------- the Executive shall be entitled to receive prompt reimbursement for all reasonable and customary expenses incurred by the Executive in performing services hereunder, including all expenses of travel and living expenses while away from home on business or at the request of and in the service of the Company, provided that all such expenses are accounted for in accordance with the policies and procedures established by the Company. The Company shall also provide the Executive during the term of his employment hereunder with an automobile allowance of $2,000 per month. 7. Confidential Information. ------------------------ (a) The Executive covenants and agrees that the Executive will not ever, without the prior written consent of the Board or a person authorized by the Board or except as may be ordered by a court of competent jurisdiction, publish or disclose to any unaffiliated third party or use for the Executive's personal benefit or advantage any confidential information with respect to the Company's past, present, or planned business, including but not limited to all information and materials related to any Company business, business plan, product, service, procedure, strategy, method (including the Danaher Business System), technique, technology, research, strategy, plan, customer or supplier information, customer or supplier list, financial data, technical data, computer files, and computer software, including any of the foregoing that is in any stage of research, development, or planning, and any other information which the Executive obtained while employed by, or otherwise serving or acting on behalf of, the Company or which the Executive may possess or have under his control, that is not generally known (except for unauthorized disclosures) to the public or within the industry in which the Company does business. This covenant shall not limit the Executive's use of such confidential information in the normal course of his performance of services for the Company. (b) The Executive acknowledges that the restrictions contained in Section 7(a) hereof are reasonable and necessary, in view of the nature of the Company's business, in order to protect the legitimate interests of the Company, and that any violation thereof would result in irreparable injury to the Company. Therefore, the Executive agrees that in the event of a breach or threatened breach by the Executive of the provisions of Section 7(a) hereof, the Company shall be -5- entitled to obtain from any court of competent jurisdiction, preliminary or permanent injunctive relief restraining the Executive from disclosing or using any confidential information. Nothing herein shall be construed as prohibiting the Company from pursuing any other remedies available to it for breach or threatened breach, including, without limitation, recovery of damages from the Executive. (c) The Executive shall deliver promptly to the Company on termination of employment, or at any other time the Company may so request, all confidential materials, memoranda, notes, records, reports and other documents and materials (and all copies thereof), in whatever form or medium, that contain any of the foregoing, including but not limited to computer data, files, software, and hardware, relating to the Company's or its affiliates' respective businesses which the Executive obtained while employed by, or otherwise serving or acting on behalf of, the Company or which the Executive may then possess or have under his control. 8. Non-Competition. --------------- (a) Non-Competition. The Executive covenants and agrees that the --------------- Executive will not, during the Executive's employment hereunder and for a period of three (3) years thereafter (to the extent permitted by law), at any time and in the United States or any other jurisdiction in which the Company is engaged or has reasonably firm plans to engage in business, enter into any competitive endeavors and not undertake any commercial activity which is contrary to the best interests of the Company or its subsidiaries or affiliates, including becoming an employee, owner (except for passive investments of not more than three percent (3%) of the outstanding shares of, or any other equity interest in, any company or entity listed or traded on a national securities exchange or in an over-the-counter securities market), officer, agent, advisor, consultant or director of any firm or person which directly competes with a line or lines of business of the Company. (b) Injunctive Relief. In the event the restrictions against ----------------- engaging in a competitive activity contained in Section 8(a) hereof shall be determined by any court of competent jurisdiction to be unenforceable by reason of their extending for too great a period of time or over too great a geographical area or by reason of their being too extensive in any other respect, Section 8(a) hereof shall be interpreted to extend only over the maximum period of time for which it may be enforceable and over the maximum geographical area as to which it may be enforceable and to the maximum extent in all other respects as to which it may be enforceable, all as determined by the court in the action. (c) Non-Solicitation. The Executive covenants and agrees that the ---------------- Executive will not, during the Executive's employment hereunder and for a period of three (3) years thereafter solicit, induce, entice, or encourage or attempt to solicit, induce, entice, or encourage any employee of the Company or any of the Company's -6- affiliates to render services for any other person, firm, entity, or corporation or to terminate his or her employment with the Company. 9. Termination of Employment. ------------------------- (a) Death. The Executive's employment hereunder shall terminate ----- upon the Executive's death. (b) By the Company. The Company may terminate the Executive's -------------- employment hereunder under the following circumstances: (i) The Company may terminate the Executive's employment hereunder for "Disability." For purposes of this Agreement, the Company shall have the right to terminate the Executive's employment by reason of "Disability" if, as a result of the Executive's incapacity due to physical or mental illness, the Executive shall have been absent from his duties hereunder on a full-time basis for the entire period of six (6) consecutive months, and within thirty (30) days after written notice of termination is given shall not have returned to the performance of his duties hereunder on a full-time basis. (ii) The Company may terminate the Executive's employment hereunder with or without "Cause." For purposes of this Agreement, "Cause" shall mean (A) the willful and continued failure by the Executive to substantially perform his duties hereunder (other than any such failure resulting from the Executive's incapacity due to physical or mental illness or any such actual or anticipated failure after the issuance of a Notice of Termination, as defined in Section 9(e), by the Executive for Good Reason, as defined in Section 9(c)), after demand for substantial performance is delivered by the Company that specifically identifies the manner in which the Company believes the Executive has not substantially performed his duties, which is not cured within 10 days after notice of such failure has been given to the Executive by the Company, (B) the willful engaging by the Executive in misconduct which is materially injurious to the Company, monetarily or otherwise (including, but not limited to, conduct that violates Section 8(a) hereof), or (C) the Executive's conviction of any felony. For purposes of this paragraph, no act, or failure to act, on the Executive's part shall be considered "willful" unless done, or omitted to be done by him not in good faith and without reasonable belief that his action or omission was in the best interest of the Company. (iii) The Company, in the sole discretion of the Board, may terminate the Executive's employment hereunder at any time other than for Disability or Cause, for any reason or for no reason at all. (c) By the Executive. The Executive may terminate the Executive's ---------------- employment hereunder at any time, with or without "Good Reason." For purposes of this Agreement, "Good Reason" shall mean any one or more of the following circumstances: -7- (i) A failure by the Company to comply with any material provision of this Agreement which has not been cured within ten (10) days after notice of such noncompliance has been given by the Executive to the Company, including, without limitation, any failure to appoint or continue the Executive to an office or position as required by this Agreement; (ii) Any purported termination of the Executive's employment which is not effected pursuant to a Notice of Termination satisfying the requirements of Section 9(e) hereof (and for purposes of this Agreement no such purport ed termination shall be effective); (iii) The assignment to the Executive of any duties materially inconsistent with his status as the Chief Operating Officer, or as the President and Chief Executive Officer of the Company (as applicable at the time when the events enumerated in this paragraph (iii) occur) or a material adverse alteration in the nature or status of his responsibilities in connection with such positions; (iv) Relocation of the Executive to a location which is not within Washington, the District of Columbia, or the suburban Maryland or Virginia area adjacent to the District of Columbia, except for required travel on the Company's business to an extent substantially consistent with the Executive's business travel obligations; (v) The failure by the Company to continue in effect any compensation or benefit plan in which the Executive participated as of the Effective Date and which is material to the Executive's aggregate compensation and benefits hereunder, unless an equitable arrangement (embodied in an ongoing substitute or alternative plan) has been made with respect to such plan, or the failure by the Company to continue the Executive's participation therein (or in such substitute or alternative plan) on a basis not materially less favorable, both in terms of the amount of benefits provided and the level of the Executive's participation relative to other participants, as existed at the Effective Date; (vi) If there is a Change of Control, merger, acquisition or other similar affiliation with another entity (a "Corporate Event") and the Executive does not continue as the Chief Operating Officer, or any other more senior office or directorship he holds immediately prior to such Corporate Event, of the most senior resulting entity of the affiliated group of which Company or the surviving entity is a member after the Corporate Event; or (vii) The failure of the Company to obtain a satisfactory agreement from any successor to assume and agree to perform this Agreement. (d) Change of Control. For the purpose of this Agreement, a "Change ----------------- of Control" shall mean any one or more of the following circumstances: -8- (i) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) (a "Person") of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of the greater of (1) 30% or more of either (A) the then-outstanding shares of common stock of the Company (the "Outstanding Company Common Stock") or (B) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors (the "Outstanding Company Voting Securities") and (2) the lowest whole number percentage which is greater than the combined percentage of the Outstanding Company Common Stock or the Outstanding Company Voting Securities owned by Steven and Mitchell Rales and affiliates (within the meaning of Rule 12b-2 of the Securities Exchange Act of 1934, as amended) of Steven and Mitchell Rales (without duplication); provided, however, that for purposes of this subsection any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company shall not constitute a Change of Control; or (ii) Individuals who, as of the date hereof, constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company's shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though the individual were a member of the Incumbent Board, but excluding, for this purpose, any individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or (iii) Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company (a "Business Combination"), in each case, unless, following a Business Combination, all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to the Business Combination beneficially own, directly or indirectly, more than 50% of, respectively, the then- outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from the Business Combination (including, without limitation, a corporation which as a result of the transaction owns the Company or all or substantially all of the Company's assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to the Business Combination of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be; or -9- (iv) Approval by the shareholders of the Company of a complete liquidation or dissolution of the Company. (e) Notice of Termination. Any termination of the Executive's --------------------- employment by the Company or the Executive (other than pursuant to Section 9(a) hereof) shall be communicated by written "Notice of Termination" to the other party hereto in accordance with Section 11 hereof. For purposes of this Agreement, a "Notice of Termination" shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon, if any, and, if for "Cause" or for "Good Reason", shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision so indicated. (f) Date of Termination. For purposes of this Agreement, the "Date ------------------- of Termination" shall mean (i) if the Executive's employment is terminated by the Executive's death, the date of the Executive's death; (ii) if the Executive's employment is terminated pursuant to Section 9(b)(i) hereof, thirty (30) days after Notice of Termination, provided that the Executive shall not have returned to the performance of the Executive's duties on a full-time basis during this 30-day period; (iii) if the Executive's employment is terminated pursuant to Section 9(b)(ii) or 9(c) hereof, the date specified in the Notice of Termination; and (iv) if the Executive's employment is terminated for any other reason, the date on which Notice of Termination is given. 10. Compensation Upon Termination. ----------------------------- (a) If the Executive's employment is terminated by the Executive's death, the Company shall pay or provide the following amounts to the Executive's estate, or as may be directed by the legal representatives of the estate, not later than 14 days from the Date of Termination in the case of the payments referred to in clauses (i), (ii) and (iii) below and, at the time when such payments are due, in the case of the payments referred to in clause (iv) below (the respective "Payment Due Dates") and the Company shall have no further obligations to the Executive under this Agreement: (i) Base Salary through the Date of Termination; (ii) the balance of any annual or long-term cash incentive awards (if any) earned (but not yet paid) pursuant to the terms of the applicable programs; (iii) any deferred compensation (together with any accrued interest or earnings thereon) including but not limited to deferred bonuses allocated or credited to the Executive or his account as of the Date of Termination, or date of payment, if later; and -10- (iv) the pro-rata Annual Bonus determined in accordance with Section 5(b), and any other or additional benefits in accordance with applicable plans or programs of the company. For purposes of this Agreement, the amounts listed in subsections (i) through (iv) above shall be collectively referred to as the "Accrued Obligations." (b) (i) If the Company terminates the Executive's employment for Disability as provided in Section 9(b)(i) hereof, the Company shall pay or provide the Executive all of the Accrued Obligations, on the respective Payment Due Dates, and the Company shall have no further obligations to the Executive under this Agreement except as provided in clause (ii) below; provided, that -------- payments made to the Executive during the Disability Period shall be reduced by the sum of the amounts, if any, payable to the Executive at or prior to the time of any payment under disability benefit plans of the Company, to the extent not previously applied to reduce any payment. (ii) The Company shall maintain in full force and effect, for the continued benefit of the Executive for twelve months following the Date of Termination due to Disability, all employee welfare benefit plans and programs in which the Executive was entitled to participate immediately prior to the Date of Termination provided that the Executive's continued participation is possible under the general terms and provisions of such plans and programs. In the event that the Executive's participation in any such plan or program is barred, the Company shall arrange to provide the Executive with benefits substantially similar to those which the Executive would otherwise have been entitled to receive under such plans and programs from which his continued participation is barred. (c) If the Company terminates the Executive's employment for Cause as provided in Section 9(b)(ii) hereof, or if the Executive terminates his employment without Good Reason, the Company shall pay or provide, on the respective Payment Due Dates, the Executive all of the Accrued Obligations, other than the pro-rata bonus, and the Company shall have no further obligations to the Executive under this Agreement. (d) If the Company terminates the Executive's employment other than for Cause or Disability or if the Executive terminates the Executive's employment for Good Reason as provided in Section 9(c) hereof, or if the Company terminates this Agreement by giving notice of termination pursuant to Section 2, the Company shall pay or provide, on the respective Payment Due Dates or as otherwise provided below, and shall have no further obligations to the Executive: (i) The Accrued Obligations; -11- (ii) An amount equal to the sum of (x) the Executive's Base Salary and (y) the target Annual Bonus for the year of termination, in substantially equal proportionate installments in accordance with the Company's normal payroll practices, commencing with the first payroll period in the month following the month in which the Date of Termination occurs, for a period of two years; (iii) The Company shall pay all reasonable legal fees and expenses incurred by the Executive as a result of such termination, including the reasonable fees and expenses of enforcing the terms of this Agreement, if the Executive establishes that he was terminated without Cause or terminated his employment for Good Reason, or in connection with any tax audit or proceeding to the extent attributable to the application of Section 4999 of the Internal Revenue Code of 1986 as amended (the "Code") to any payment or benefit provided hereunder; (iv) For two years after the Date of Termination, or any longer period as may be provided by the terms of the appropriate plan, program, practice or policy, the Company shall continue benefits to the Executive and the Executive's family at least equal to those which would have been provided to them in accordance with the welfare benefit plans, practices, policies and programs provided by the Company and its affiliated companies (including, without limitation, medical, prescription, dental, disability, employee life, group life, accidental death and travel accident insurance plans and programs) to the extent applicable generally to other peer employees of the Company and its affiliated companies, as if the Executive's employment had not been terminated; provided, however, that if the Executive becomes reemployed with -------- ------- another employer and is eligible to receive medical or other welfare benefits under another employer provided plan, the medical and other welfare benefits described herein shall be secondary to those provided under the other plan during the applicable period of eligibility; and (v) To the extent not theretofore paid or provided, the Company shall timely pay or provide to the Executive any other amounts or benefits required to be paid or provided or which the Executive is eligible to receive under any plan, program, policy or practice or contract or agreement of the Company and its affiliated companies. (e) Excise Tax Restoration Payment. In the event that it is ------------------------------ determined that any payment or distribution of any type to or for the benefit of the Executive made by the Company, by any of its affiliates, by any person who acquires ownership or effective control or ownership of a substantial portion of the Company's assets (within the meaning of section 280G of the Code) or by any affiliate of this person, whether paid or payable or distributed or distributable pursuant to the terms of an employment agreement or otherwise (the "Total Payments"), would be subject to the excise tax imposed by section 4999 of the Code -12- or any interest or penalties with respect to the excise tax (the excise tax, together with any interest or penalties, are collectively referred to as the "Excise Tax"), then the Executive shall be entitled to receive an additional payment (an "Excise Tax Restoration Payment") in an amount that shall fund the payment by the Executive of any Excise Tax on the Total Payments as well as all income taxes imposed on the Excise Tax Restoration Payment, any Excise Tax imposed on the Excise Tax Restoration Payment and any interest or penalties imposed with respect to taxes on the Excise Tax Restoration or any Excise Tax. (f) Mitigation. The Executive shall not be required to mitigate ---------- amounts payable pursuant to Section 10 hereof by seeking other employment provided, however, that the Company's obligation to continue to provide the - -------- ------- Executive with fringe benefits pursuant to this Agreement above, shall cease if the Executive and his family become eligible to participate in fringe benefits substantially similar to those provided for in this Agreement as a result of the Executive's employment during the period that the Executive and his family is entitled to these fringe benefits. (g) No Additional Payments. Notwithstanding anything to the ---------------------- contrary in this Agreement, the Executive acknowledges and agrees that in the event of the termination of his employment, even if in breach of this Agreement, he will be entitled only to those payments specified herein for the circumstances of his termination, and not to any other payments by way of damages or claims of any nature, whether under this Agreement or under any other agreements between the Executive and the Company. 11. Notices. All notices, demands, requests or other communications ------- required or permitted to be given or made hereunder shall be in writing and shall be delivered, telecopied or mailed by first class registered or certified mail, postage prepaid, addressed as follows: (a) If to the Company: Danaher Corporation 1250 24th Street, N.W., Suite 800 Washington, D.C. 20037 (202) 828-0850 Telecopy: (202) 828-0860 Attention: Secretary -13- (b) If to the Executive: Henry Lawrence Culp, Jr. c/o Danaher Corporation 1250 24th Street, N.W., Suite 800 Washington, D.C. 20037 (202) 828-0850 Telecopy: (202) 828-0860 with a copy (which shall not constitute notice) to: Stephen T. Lindo, Esq. Willkie Farr & Gallagher 787 7th Avenue New York, NY 10019 (212) 728-8242 Telecopy: (212) 728-8111 or to such other address as may be designated by either party in a notice to the other. Each notice, demand, request or other communication that shall be given or made in the manner described above shall be deemed sufficiently given or made for all purposes three (3) days after it is deposited in the U.S. mail, postage prepaid, or at such time as it is delivered to the addressee (with the return receipt, the delivery receipt, the answer back or the affidavit of messenger being deemed conclusive evidence of delivery) or at such time as delivery is refused by the addressee upon presentation. 12. Severability. The invalidity or unenforceability of any one or ------------ more provisions of this Agreement shall not affect the validity or enforceability of the other provisions of this Agreement, which shall remain in full force and effect. 13. Survival. It is the express intention and agreement of the parties -------- hereto that the provisions of Sections 7 and 8 hereof shall survive the termination of employment of the Executive. In addition, all obligations of the Company to make payments hereunder shall survive any termination of this Agreement on the terms and conditions set forth herein. 14. Successors and Assigns. ---------------------- (a) This Agreement is personal to the Executive and without the prior written consent of the Company shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive's legal representatives. (b) This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns. -14- (c) The Company will require any successor or any party that acquires control of the Company (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company or any party that acquires control of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no succession had taken place. As used in this Agreement, "Company" shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise. 15. Resolution of Disputes. Any disputes arising under on in ---------------------- connection with this Agreement shall, at the election of the Executive or the Company, be resolved by binding arbitration, to be held in Washington, D.C. in accordance with the rules and procedures of the American Arbitration Association. Judgment upon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. Each party shall bear its own costs and expenses in connection with any arbitration or court proceeding (including fees and disbursements of counsel), subject to Section 10(d)(iii) hereof. 16. Legal Fees. The Company shall promptly pay the legal fees and ---------- expenses incurred by the Executive in connection with negotiation and execution of this Agreement. 17. Binding Effect. Subject to any provisions hereof restricting -------------- assignment, this Agreement shall be binding upon the parties hereto and shall inure to the benefit of the parties and their respective heirs, devisees, executors, administrators, legal representatives, successors and assigns. 18. Amendment; Waiver. This Agreement shall not be amended, altered or ----------------- modified except by an instrument in writing duly executed by the parties hereto. Neither the waiver by either of the parties hereto of a breach of or a default under any of the provisions of this Agreement, nor the failure of either of the parties, on one or more occasions, to enforce any of the provisions of this Agreement or to exercise any right or privilege hereunder, shall thereafter be construed as a waiver of any subsequent breach or default of a similar nature, or as a waiver of any provisions, rights or privileges hereunder. 19. Headings. Section and subsection headings contained in this -------- Agreement are inserted for convenience of reference only, shall not be deemed to be a part of this Agreement for any purpose, and shall not in any way define or affect the meaning, construction or scope of any of the provisions hereof. 20. Governing Law. This Agreement, the rights and obligations of the ------------- parties hereto, and any claims or disputes relating thereto, shall be governed by -15- and construed in accordance with the laws of the State of Delaware (but not including the choice of law rules thereof). 21. Entire Agreement. This Agreement constitutes the entire agreement ---------------- between the parties hereto with respect to the subject matter hereof, and it supersedes all prior oral or written agreements, commitments or understandings with respect to the matters provided for herein other than stock option agreements and certificates and the Company's employee benefit plans which are covered by the Employee Retirement Income Security Act of 1974. 22. Counterparts. This Agreement may be executed in two or more ------------ counterparts, each of which shall be an original and all of which shall be deemed to constitute one and the same instrument. IN WITNESS WHEREOF, the undersigned have duly executed this Agreement, or have caused this Agreement to be duly executed on their behalf, as of the day and year first hereinabove written. DANAHER CORPORATION By: /s/ Steven M. Rales ------------------- Name: STEVEN M. RALES Title: Chairman of the Board Date of Execution:____________ THE EXECUTIVE: /s/ H.L. Culp, Jr. ------------------- Henry Lawrence Culp, Jr. Date of Execution: October 13, 2000 ---------------- -16- PROMISSORY NOTE $500,000.00 WASHINGTON, D.C. October 13, 2000 FOR VALUE RECEIVED, the undersigned Henry Lawrence Culp, Jr. (hereinafter "Culp") hereby promises to pay to the order of Danaher Corporation, 1520 24th Street, Suite 800, N.W., Washington, D.C. 20037 (hereinafter called the "Company") the principal amount of FIVE HUNDRED THOUSAND DOLLARS ($500,000.00), without interest, in the manner set forth herein. This Note and the indebtedness evidenced hereby are being provided pursuant to the terms of the employment agreement dated July 18, 2000 (the "Effective Date") between Culp and the Company (the "Employment Agreement"). Subject to the terms and conditions contained herein, if Culp is employed by the Company for the full period from the Effective Date through the third anniversary of the Effective Date (the "Third Anniversary"), then on the Third Anniversary the indebtedness evidenced by this Note shall be forgiven by the Company in full as of such date and this Note shall be marked cancelled. In the event Culp's employment with the Company is terminated prior to the Third Anniversary, the following shall apply: A. If Culp's employment with the Company is terminated for "Cause" (as defined in the Employment Agreement), Culp will repay to the Company, within fourteen (14) days of such termination date, a pro rata portion of the sums advanced to him pursuant to this Note based on the following formula: Amount of principal to be repaid = $500,000 multiplied by (1,095 minus the number of days from the Effective Date through the Date of Termination) divided by 1,095. B. In the event that Culp's employment with the Company is terminated either by the Company without Cause (as defined in the Employment Agreement) or by reason of Culp's death or Disability or by Culp for "Good Reason" (each as defined in the Employment Agreement), then on the date of such employment termination the indebtedness evidenced by this Note shall be forgiven by the Company in full as of such date and this Note shall be marked cancelled. C. In the event Culp terminates his employment with the Company other than for Good Reason, Culp shall repay, within fourteen (14) days of such -1- termination date, the same principal amount evidenced by this Note as if he had been terminated for "Cause". The repayment obligation referenced in the preceding sentence shall not apply in the event of a termination of the Employment Agreement by reason of Culp's death or Disability. The Company shall have the right to set off any amounts which Culp owes the Company hereunder against any monies which the Company or any of its subsidiaries may owe to Culp, of any nature whatsoever, including without limitation, any compensation and any severance owed under the Employment Agreement or any other benefit owed to or held by Culp as an employee of the Company or any of its subsidiaries, and Culp hereby agrees to and authorizes any such setoff. If payment of the principal on this Note is not paid in accordance with the terms aforementioned, then this Note shall be deemed to be in default and if suit is brought to collect this Note, the Company shall be entitled to collect, in addition to any principal outstanding, all reasonable costs and expenses to include, but not necessarily be limited to, reasonable attorneys' fees and expenses. Presentment, notice of dishonor and protest are hereby waived by Culp. This Note shall be binding upon Culp and his heirs, executors, administrators, and legal representatives. No delay or omission on the part of the Company in exercising any rights hereunder shall operate as a waiver of such rights or of any other right to the Company, nor shall any delay, omission or waiver on any one occasion be deemed as a bar to or waiver of the same or any other right on any future occasion. This note may not be changed or terminated orally. Culp shall have the right to prepay the principal of this Note, in whole or in part, at any time or times, without penalty. All rights and obligations hereunder shall be governed by, and construed and enforced in accordance with, the substantive laws of the State of Delaware, and this Note is executed as, and shall have effect of, a sealed instrument. If any provision of this transaction is inconsistent with the laws and status of the State of Delaware, the rest of the transaction shall not be affected, and that part that is not in accord with the said laws shall be adjusted to so comply. IN WITNESS WHEREOF, the undersigned has executed this Note as an instrument under seal this 13th day of October, 2000. /s/ H.L. Culp, Jr. ------------------- Henry Lawrence Culp, Jr. -2- EX-13 4 dex13.txt EXHIBIT 13 Exhibit 13 Auditors Arthur Andersen LLP Baltimore, Maryland Shareholders' Information For shareholder information or assistance, please write or call our corporate office. Danaher Corporation c/o Investor Relations 1250 24th Street, NW Suite 800 Washington, D.C. 20037 (202) 828-0850 Internet Address: http://www.danaher.com Stock Listing Symbol: DHR New York and Pacific Stock Exchanges Transfer Agent SunTrust Bank Atlanta, Georgia Form 10-K A copy of the Annual Report to the Securities and Exchange Commission on Form 10-K may be obtained by writing to Danaher Corporation 1 MARKET PRICES OF COMMON STOCK
2000 1999 ---- ---- High Low High Low --------------------------------------------------- First quarter....... 51 1/4 36 7/16 55 46 3/8 Second quarter....... 58 15/16 46 13/16 69 51 3/8 Third quarter........ 56 3/4 45 3/16 62 5/8 47 1/2 Fourth quarter....... 69 13/16 49 54 3/8 42 3/4
High and low per share data are as quoted on the New York Stock Exchange. 2 SELECTED FINANCIAL DATA (000's omitted except per share data) - -------------------------------------------------------------------------------- 2000 1999 1998 1997 1996 ---------- ---------- ---------- ---------- ---------- Sales $3,777,777 $3,197,238 $3,047,061 $2,619,100 $2,352,249 Operating profit 552,149 458,007 384,112 319,346 284,411 Earnings from continuing operations 324,213 261,624** 192,186* 188,576 166,511 Per share Diluted 2.23 1.79** 1.33* 1.31 1.17 Basic 2.28 1.84** 1.37* 1.35 1.19 Discontinued operations -- -- -- -- 79,811 Per share Diluted -- -- -- -- 0.56 Basic -- -- -- -- 0.57 Net earnings 324,213 261,624** 192,186* 188,576 246,322 Earnings per share Diluted 2.23 1.79** 1.33* 1.31 1.72 Basic 2.28 1.84** 1.37* 1.35 1.76 Dividends per share 0.07 0.07 0.09 0.10 0.10 Total assets 4,031,679 3,047,071 2,840,859 2,264,741 2,148,888 Total debt 795,190 374,634 503,639 229,095 239,927
* Includes $28.6 million in after-tax costs ($0.20 per share) from the merger with the Fluke Corporation ** Includes $9.8 million in after-tax costs ($0.07 per share) from the merger with the Hach Company 3 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND --------------------------------------------------------------- RESULTS OF OPERATIONS --------------------- Results of Operations Danaher Corporation (the "Company") designs, manufactures and markets industrial and consumer products with strong brand names, proprietary technology and major market positions in two business segments: Process/Environmental Controls and Tools and Components. The Process/Environmental Controls Segment is a leading producer of environmental products, including water quality analytical instrumentation and leak detection systems for underground fuel storage tanks; compact professional electronic test tools; and motion, position, speed, temperature, pressure, level, flow, particulate and power reliability and quality control and safety devices. In its Tools and Components Segment, the Company is a leading producer and distributor of general-purpose mechanics' hand tools and automotive specialty tools, as well as of toolboxes and storage devices, diesel engine retarders, wheel service equipment, drill chucks, and hardware and components for the power generation and transmission industries. Presented below is a summary of sales by business segment. (000's omitted) 2000 1999 1998 --------------------------------------------------------------- $ % $ % $ % Process/Environmental Controls $2,441,986 64.6% $1,854,184 58.0% $1,752,552 57.5% Tools and Components 1,335,791 35.4% 1,343,054 42.0% 1,294,509 42.5% ---------- ------ ---------- ------ --------- ------ $3,777,777 100.0% $3,197,238 100.0% $3,047,061 100.0% ========== ====== ========== ====== ========== ======
Process/Environmental Controls - ------------------------------ The Process/Environmental Controls segment is comprised of Hach Company, the Dr. Bruno Lange Group, McCrometer, Fluke Corporation, Fluke Networks, Veeder-Root Company, the Danaher Industrial Controls Group, the Danaher Motion Control Group (including the General Purpose Systems Division, the Motion Components Division and the Special Purpose Systems Division), the controls business units of Joslyn Corporation and Pacific Scientific Company, M&M Precision Systems, Cyberex, Current Technology, United Power Corporation, QualiTROL Corporation, Gems Sensors, Kollmorgen Artus, and Kollmorgen Electro- Optical. These companies produce and sell compact, professional electronic test tools; underground storage tank leak detection systems; motion, position, speed, temperature, and level instruments and sensing devices; power switches and controls; communication line products; power protection products; liquid flow and quality measuring devices; quality assurance products and systems; safety devices; and electronic and mechanical counting and controlling devices. These products are distributed by the Company's sales personnel and independent representatives to original equipment manufacturers, distributors and other end- users. 2000 COMPARED TO 1999 Sales in 2000 were 32% higher than in 1999 for this segment. The acquisitions of American Precision Industries, Kollmorgen Corporation, Warner Electric Motion and several smaller businesses provided a 24% increase from 1999. The remainder of the sales change was generated by an increase in unit volume of 10.5%, offset by a 2.5% negative currency translation impact. Double- digit volume increases were achieved in the power quality, water quality, motion and electronic test businesses. The motion control business units contributed the majority of the acquisition sales increase. Operating margins increased from 15.5% to 15.7% due to higher sales volumes which were spread over a fixed cost base, continued margin improvements in the electronic test businesses and cost reductions which were offset by lower operating margins of those businesses acquired during 2000. 4 1999 COMPARED TO 1998 Sales in 1999 increased 6% from 1998 levels. Net unit volume increases of 3.5% were driven by gains in the water quality and power quality product lines, offset by lower sales of underground storage tank monitoring systems. 1999 was negatively impacted by price decreases and foreign currency translation decreases totaling over 1%. Acquisition activity contributed 4% of the increase, due primarily to the full-year impact of the Pacific Scientific Company and Dr. Bruno Lange Group acquisitions. Operating margins increased from 13.7% to 15.5% due to overall cost reductions and improvements in the margins of those businesses acquired in 1998. Tools and Components - -------------------- The Tools and Components Segment is comprised of the Danaher Hand Tool Group (including the Special Markets, Asian Tools, Professional Tools and Matco Tools Divisions), Jacobs Chuck Manufacturing Company, Delta Consolidated Industries, Jacobs Vehicle Systems, Hennessy Industries, and the hardware and electrical apparatus lines of Joslyn Manufacturing Company. This segment is one of the largest domestic producers and distributors of general-purpose and specialty mechanics' hand tools. Other products manufactured by these companies include toolboxes and storage devices; diesel engine retarders; wheel service equipment; drill chucks; custom-designed headed tools and components; hardware and components for the power generation and transmission industries; and high- quality precision socket screws, fasteners, and miniature precision parts. 2000 COMPARED TO 1999 Comparable sales for the segment were flat from 1999 to 2000, as reported sales showed a 0.5% decline after a small divestiture. A sharp decline in diesel engine retarder sales accounted for a 3% drop in segment sales and was offset by growth in the hand tool and related products business units, while prices were essentially flat. Operating profit margins increased from 14.0% to 14.2% as a result of cost reductions implemented throughout the segment. 1999 COMPARED TO 1998 Sales in 1999 were 4% higher than in 1998. This increase consists of a higher unit shipment volume of 5%, offset by price decreases of 1%. Demand for diesel engine retarders and professional mechanics' tools was particularly strong in 1999. Operating margins increased from 12.3% to 14.0%, driven by higher sales volumes spread over a fixed cost base and continued manufacturing cost improvements. Gross Profit - ------------ Gross profit margin was 38.7%, the same as the 1999 gross margin. Productivity improvements and manufacturing overhead cost reductions were offset by the lower margins of businesses acquired in 2000. Gross profit, as a percentage of sales, was 38.7% in 1999, a 0.7 point improvement compared to 38.0% achieved in 1998. Product and manufacturing overhead cost reductions, combined with increases in higher margin product lines, drove this improvement. Operating Expenses - ------------------ Selling, general and administrative expenses for 2000 as a percentage of sales were 0.2 points lower than in 1999. Higher spending levels in acquired businesses were offset by cost reductions and the leverage of higher sales. 5 In 1999, selling, general and administrative expenses were 24.3% of sales, an improvement of 1.1 percentage points from 1998 levels. Cost reductions in administrative overhead expenses and higher sales levels spread over a fixed- cost base generated this improvement. Interest Costs and Financing Transactions - ----------------------------------------- The Company's debt financing is composed primarily of $283 million of 6.25% Eurobond notes due 2005, $250 million of publicly issued 6% notes due 2008, uncommitted lines and a revolving credit facility which provides senior financing of $250 million for general corporate purposes. The interest rates for borrowing under the revolving credit facility float with base rates. In January 2001, the Company completed a $450 million 2.375% convertible debt offering. Interest expense in 2000 was $12.6 million higher than in 1999 due to higher debt and lower cash levels which resulted from acquisitions completed during 2000. Interest expense in 1999 was $9.6 million lower than in 1998 due to lower debt and higher cash levels which were generated primarily by substantial cash flow from operations. Income Taxes - ------------ The 2000 effective tax rate of 38.0% is 1.1 percentage points lower than in 1999, driven primarily by an increase in taxable income in lower rate foreign jurisdictions and the nondeductible expenses associated with the Hach merger in 1999. The 1999 effective rate of 39.1% is 0.3 percentage points lower than in 1998. This decrease results primarily from a lower ratio of nondeductible amortization compared to taxable income. Inflation - --------- The effect of inflation on the Company's operations has been minimal in 2000, 1999 and 1998. Financial Instruments and Risk Management - ----------------------------------------- The Company is exposed to market risk from changes in foreign currency exchange rates and interest rates, which could impact its results of operations and financial condition. The Company manages its exposure to these risks through its normal operating and financing activities. There were no material derivative instrument transactions during any of the periods presented. The Company's issuance of Eurobond notes in 2000 provides a hedge to a portion of the Company's European net asset position. The Company has generally accepted the exposure to exchange rate movements relative to its investment in foreign operations without using derivative financial instruments to manage this risk. The fair value of the Company's fixed-rate long-term debt is sensitive to changes in interest rates. The value of this debt is subject to change as a result of movements in interest rates. Sensitivity analysis is one technique used to evaluate this potential impact. Based on a hypothetical, immediate 100 basis-point increase in interest rates at December 31, 2000, the market value of the Company's fixed-rate long-term debt would be impacted by a net decrease of $27 million. This methodology has certain limitations, and these hypothetical gains or losses would not be reflected in the Company's results of operations or financial conditions under current accounting principles. Liquidity and Capital Resources - ------------------------------- In 2000, the Company acquired American Precision Industries, Kollmorgen Corporation, Warner Electric Motion and additional smaller businesses for a total of $707 million in cash. In 1999, the 6 Company acquired Atlas Copco Controls and additional smaller businesses for a total of $65 million. The Company also acquired Pacific Scientific Company for approximately $420 million in cash in March 1998. See Note 2 to the Consolidated Financial Statements for a further discussion of the impact of acquisitions. As discussed previously, $283 million of the Company's debt is fixed at a rate of 6.25%, and $250 million is fixed at an average interest cost of 6%. Substantially all remaining borrowings are short-term in nature and float with referenced base rates. As of December 31, 2000, the Company has unutilized commitments under its revolving credit facility of $250 million. As of December 31, 2000, the Company held $177 million of cash and cash equivalents. These amounts are invested in highly liquid investment grade debt instruments with a maturity of 90 days or less. During January 2001, the Company acquired United Power Corporation for approximately $108 million in cash. Also in January 2001, the Company issued $722 million in zero-coupon convertible senior notes due 2021, yielding gross cash proceeds of $450 million, with an effective yield to maturity of 2.375%. See Note 14 to the Consolidated Financial Statements for a further discussion of these subsequent events. Operating cash flow has been strong in all periods. During the first quarter of 2000, the Company repurchased $82 million of its common stock. In July 1999, the Company sold $70 million of treasury stock through its Hach Company subsidiary. Operations generated $512 million, $419 million and $353 million in cash in 2000, 1999 and 1998, respectively. The principal use of funds has been capital expenditures of $89 million, $89 million, and $102 million in 2000, 1999 and 1998, respectively, and net cash paid for acquisitions of $707 million, $65 million and $532 million in 2000, 1999 and 1998, respectively. The net result of the above, combined with working capital changes, was an increase in debt of $421 million in 2000, a decrease in debt of $130 million in 1999, and an increase in debt of $215 million in 1998. The Company's funds provided from operations, as well as the existing bank facility and available credit lines, should provide sufficient available funds to meet the Company's working capital, capital expenditure, dividend and debt service requirements for the foreseeable future. 7 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Shareholders and Board of Directors of Danaher Corporation: We have audited the accompanying consolidated balance sheets of Danaher Corporation (a Delaware corporation) and subsidiaries as of December 31, 2000 and 1999, and the related consolidated statements of earnings, stockholders' equity, and cash flows for each of the three years in the period ended December 31, 2000. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Danaher Corporation and subsidiaries as of December 31, 2000 and 1999, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2000, in conformity with accounting principles generally accepted in the United States. ARTHUR ANDERSEN LLP Baltimore, Maryland January 24, 2001 8 DANAHER CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS (in thousands, except per share data)
Year Ended December 31, ------------------------------------------------ 2000 1999 1998 ---------- ---------- ---------- Sales.......................................... $3,777,777 $3,197,238 $3,047,061 Cost of sales.................................. 2,315,731 1,960,822 1,889,229 Selling, general and administrative expenses... 909,897 778,409 773,720 ---------- ---------- ---------- Total operating expenses.................. 3,225,628 2,739,231 2,662,949 ---------- ---------- ---------- Operating profit............................... 552,149 458,007 384,112 Other expense.................................. -- 11,778 40,796 Interest expense............................... 29,225 16,667 26,307 ---------- ---------- ---------- Earnings before income taxes................... 522,924 429,562 317,009 Income taxes................................... 198,711 167,938 124,823 ---------- ---------- ---------- Net earnings................................... $ 324,213 $ 261,624 $ 192,186 ========== ========== ========== Basic earnings per share: Net earnings............................... $2.28 $1.84 $1.37 ========== ========== ========== Average shares outstanding..................... 142,469 141,832 139,816 ========== ========== ========== Diluted earnings per share: Net earnings.............................. $ 2.23 $ 1.79 $ 1.33 ========== ========== ========== Average common stock and common equivalent shares outstanding........................ 145,499 146,089 143,987 ========== ========== ==========
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements. 9 DANAHER CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands)
As of December 31, -------------------------------- 2000 1999 ---------- ---------- ASSETS Current assets: Cash and equivalents........................................ $ 176,924 $ 260,281 Trade accounts receivable, less allowance for doubtful accounts of $37,000 and $28,000........................ 704,214 544,738 Inventories................................................. 460,610 324,673 Prepaid expenses and other.................................. 132,558 72,425 ---------- ---------- Total current assets................................... 1,474,306 1,202,117 Property, plant and equipment, net.......................... 575,531 500,189 Other assets................................................ 117,942 52,476 Excess of cost over net assets of acquired companies, less accumulated amortization of $245,000 and $196,000.......... 1,863,900 1,292,289 ---------- ---------- $4,031,679 $3,047,071 ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Notes payable and current portion of debt................... $ 81,633 $ 33,597 Trade accounts payable...................................... 262,095 213,209 Accrued expenses............................................ 674,812 461,980 ---------- ---------- Total current liabilities.............................. 1,018,540 708,786 Other liabilities........................................... 357,249 288,494 Long-term debt.............................................. 713,557 341,037 Stockholders' equity: Common stock, one cent par value; 300,000 shares authorized; 155,650 and 154,035 issued; 142,013 and 142,440 outstanding........................ 1,556 1,540 Additional paid-in capital.................................. 364,426 420,036 Accumulated other comprehensive income...................... (59,130) (34,105) Retained earnings........................................... 1,635,481 1,321,283 ---------- ----------
10
Total stockholders' equity............................. 1,942,333 1,708,754 ----------- ---------- $4,031,679 $3,047,071 =========== ==========
The accompanying Notes to Consolidated Financial Statements are an integral part of these balance sheets. 11 DANAHER CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands)
Year Ended December 31, ----------------------------------------- 2000 1999 1998 ---- ---- ---- Cash flows from operating activities: Net earnings.............................................. $ 324,213 $ 261,624 $ 192,186 Depreciation and amortization............................. 149,721 126,419 114,527 Change in trade accounts receivable....................... (15,926) (60,327) 4,409 Change in inventories..................................... (38,451) 11,149 13,851 Change in accounts payable................................ (81) 45,852 (13,869) Change in other assets, accrued expenses and other liabilities.............................................. 92,769 34,390 41,578 --------- --------- ------------ Total operating cash flows........................... 512,245 419,107 352,682 --------- --------- ----------- Cash flows from investing activities: Payments for additions to property, plant and equipment, net...................................................... (88,503) (88,909) (101,614) Proceeds from disposition of businesses................... -- -- 16,250 Net cash paid for acquisitions............................ (706,794) (64,834) (532,368) --------- --------- ----------- Net cash used in investing activities............... (795,297) (153,743) (617,732) --------- --------- ----------- Cash flows from financing activities: Proceeds from sale of treasury stock...................... -- 69,845 -- Proceeds from issuance of common stock.................... 26,580 18,141 30,545 Dividends paid............................................ (10,015) (9,912) (12,840) Borrowings (repayments) of debt, net...................... 266,090 (129,851) 214,905 Purchase of treasury stock................................ (82,174) -- (2,066) --------- --------- ----------- Net cash provided by (used in) financing activities. 200,481 (51,777) 230,544 --------- --------- ----------- Effect of exchange rate changes on cash................... (786) (1,104) 1,726 --------- --------- ----------- Net change in cash and equivalents........................ (83,357) 212,483 (32,780) Beginning balance of cash and equivalents................. 260,281 47,798 80,578 --------- --------- ----------- Ending balance of cash and equivalents.................... $ 176,924 $ 260,281 $ 47,798 ========= ========= =========== Supplemental disclosures: Cash interest payments............................... $ 21,057 $ 16,348 $ 26,495 ========= ========= =========== Cash income tax payments............................. $ 40,102 $ 114,617 $ 79,301 ========= ========= ===========
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements. 12 DANAHER CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (in thousands)
--------------------- Common Stock --------------------- ------------------------------------------------------------------------------------------------------------------ Accumulated Additional Other Paid-in Retained Comprehensive Comprehensive Shares Amount Capital Earnings Income Income - ------------------------------------------------------------------------------------------------------------------ Balance, December 152,932 $1,530 $294,920 $ 890,225 $(13,450) 31, 1997 - ------------------------------------------------------------------------------------------------------------------ Net earnings for the year..... -- -- -- 192,186 -- $192,186 Dividends declared......... -- -- -- (12,840) -- -- Common stock issued for options exercised......... 365 3 30,542 -- -- -- Purchase of common stock..... -- -- (2,066) -- -- -- Common stock issued for acquisitions..... -- -- 8,661 -- -- -- Increase from translation of foreign financial statements....... -- -- -- -- 12,777 12,777 Sale of securities held.. -- -- -- -- (1,700) (1,700) - ------------------------------------------------------------------------------------------------------------------ Balance, December 31, 1998 153,297 $1,533 $332,057 $1,069,571 $ (2,373) $203,263 ======== - ------------------------------------------------------------------------------------------------------------------ Net earnings for the year..... -- -- -- 261,624 -- 261,624 Dividends declared......... -- -- -- (9,912) -- -- Common stock issued for options exercised........ 738 7 18,134 -- -- -- Sale of treasury stock... -- -- 69,845 -- -- -- Decrease from translation of foreign financial statements....... -- -- -- -- (31,732) (31,732) - ------------------------------------------------------------------------------------------------------------------ Balance, December 31, 1999 154,035 $1,540 $420,036 $1,321,283 $(34,105) $229,892 ======== ------------------------------------------------------------------------------------------------------------------ Net earnings for the year..... -- -- -- 324,213 -- 324,213 Dividends declared......... -- -- -- (10,015) -- -- Common stock issued for options exercised........ 1,615 16 26,564 -- -- -- Purchase of treasury stock... -- -- (82,174) -- -- -- Decrease from translation of foreign financial statements....... -- -- -- -- (25,025) (25,025) - ------------------------------------------------------------------------------------------------------------------ Balance, December 31, 2000 155,650 $1,556 $364,426 $1,635,481 $(59,130) $299,188 ======== - ----------------------------------------------------------------------------------------------------------------
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements. 13 (1) Summary of Significant Accounting Policies: Accounting Principles - The consolidated financial statements include the accounts of the Company and its subsidiaries. The accounts of certain of the Company's foreign subsidiaries are included on the basis of a fiscal year ending November 30. This procedure was adopted to allow sufficient time to include these companies in the consolidated financial statements. All significant intercompany balances and transactions have been eliminated upon consolidation. Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Inventory Valuation - Inventories include material, labor and overhead and are stated principally at the lower of cost or market using the last-in, first- out method (LIFO). Property, Plant and Equipment - Property, plant and equipment are carried at cost. The provision for depreciation has been computed principally by the straight-line method based on the estimated useful lives (3 to 35 years) of the depreciable assets. Other Assets - Other assets include principally deferred income taxes, assets held for sale, noncurrent trade receivables and capitalized costs associated with obtaining financings which are amortized over the term of the related debt. Fair Value of Financial Instruments - For cash and equivalents, the carrying amount is a reasonable estimate of fair value. For long-term debt, rates available for debt with similar terms and remaining maturities are used to estimate the fair value of existing debt. Excess of Cost Over Net Assets of Acquired Companies - This asset is being amortized on a straight-line basis over 40 years. $48,586,000, $37,268,000 and $34,269,000 of amortization was charged to expense for the years ended December 31, 2000, 1999 and 1998, respectively. When events and circumstances so indicate, all long-term assets, including the excess of cost over net assets of acquired companies, are assessed for recoverability based upon cash flow forecasts. Should an impairment exist, fair value estimates would be determined based on cash flow forecasts discounted at a market rate of interest. Shipping and Handling - The Company adopted Emerging Issues Task Force Issue 00-10, "Accounting for Shipping and Handling Fees and Costs," which requires amounts billed to customers for shipping and handling to be included as a component of sales. The impact of implementing this statement was not significant to any periods presented. Shipping and handling costs are included as a component of cost of sales. Foreign Currency Translation - Exchange adjustments resulting from foreign currency transactions are generally recognized in net earnings, whereas adjustments resulting from the translation of financial statements are reflected as a component of accumulated other comprehensive income within stockholders' equity. Net foreign currency transaction gains or losses are not material in any of the years presented. Cash and Equivalents - The Company considers all highly liquid investments with a maturity of three months or less at the date of purchase to be cash equivalents. Income Taxes - The Company accounts for income taxes in accordance with Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes". The Company provides income taxes for unremitted earnings of foreign subsidiaries which are not considered permanently reinvested in that operation. 14 Earnings Per Share - The computation of diluted earnings per share is based on the weighted-average number of common shares and common stock equivalents outstanding during the year. Accumulated Other Comprehensive Income - This consists of primarily cumulative foreign translation loss adjustments of $59,130,000, $34,105,000 and $2,373,000, for 2000, 1999 and 1998, respectively. New Accounting Pronouncements - In June 1998, Financial Accounting Standards No. 133 "Accounting for Derivative Instruments and Hedging Activities," (FAS 133) was issued. FAS 133, as subsequently amended, establishes accounting and reporting standards for derivative instruments and hedging activities. The Company will be required to implement FAS 133 effective January 1, 2001. The Company expects that the adoption of this pronouncement will not have a material effect on operations. (2) Acquisitions: On July 3, 2000, the motion control businesses of Warner Electric Company were acquired and merged into the Company. Total consideration was approximately $147 million. The fair value of the assets acquired was approximately $185 million, and approximately $38 million of liabilities were assumed. The transaction is being accounted for as a purchase. On June 20, 2000, Kollmorgen Corporation was acquired and merged into the Company. Total consideration was approximately $363 million, including the assumption of approximately $96 million of debt. The fair value of the assets acquired was approximately $537 million, and approximately $174 million of liabilities were assumed. The transaction is being accounted for as a purchase. On March 27, 2000, American Precision Industries was acquired and merged into the Company. Total consideration was approximately $246 million, including assumption of approximately $60 million of debt. The heat transfer businesses of American Precision Industries are being carried as assets held for sale and are included in other assets at December 31, 2000. The fair value of the assets acquired was approximately $317 million, and approximately $71 million of liabilities were assumed. The transaction is being accounted for as a purchase. The above three transactions, in addition to several smaller transactions, resulted in approximately $620 million of additional excess cost over net assets of acquired companies in 2000. On July 14, 1999, Hach Company was acquired and merged into the Company. The Company issued 0.2987 shares of common stock in exchange for each outstanding share of Hach; 6,594,430 shares were exchanged for all outstanding Hach shares. The transaction was a tax-free reorganization and was accounted for as a pooling-of-interests. Accordingly, the 1999 and prior financial statements were restated to reflect the combined companies. Reflected in other expense is a one-time charge of $11.8 million ($9.8 million after-tax or $.07 per diluted share) to reflect the costs of the transaction and the elimination of redundant activities and operations. The majority of these costs are cash expenses and were incurred during 1999. On July 9, 1998, Fluke Corporation was acquired and merged into the Company. The Company issued 17,785,122 shares of common stock in exchange for all outstanding Fluke shares; 0.90478 shares were exchanged for each Fluke share. The transaction was a tax-free reorganization and was accounted for as a pooling-of-interests. Accordingly, the 1998 and prior financial statements were restated to reflect the combined companies. Reflected in other expense is a one-time charge of $40.8 million ($28.6 million after-tax or $.20 per diluted share) to reflect the costs of the transaction and integrating and implementing efficiencies associated with information, operational and administrative systems. The majority of these costs are cash expenses and were incurred during 1998. The Company acquired Pacific Scientific Company as of March 9, 1998. Total consideration was approximately $420 million. The fair value of assets acquired was approximately $520 million, and approximately $100 million of liabilities were assumed. The transaction is being accounted for as a 15 purchase. The unaudited pro forma information for the period set forth below gives effect to these transactions as if they had occurred at the beginning of the period. The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the acquisition been consummated as of that time (unaudited, 000's omitted):
Year ended December 31, 2000 1999 1998 - --------------------------- ---------- ---------- ---------- Net sales............................... $4,045,629 $3,754,460 $3,646,567 Net earnings............................ 321,984 243,057 185,580 Earnings per share (diluted)........... $ 2.21 $ 1.66 $ 1.29
(3) Inventory: The major classes of inventory are summarized as follows (000's omitted): December 31, 2000 December 31, 1999 ----------------- ----------------- Finished goods............ $ 152,509 $ 128,134 Work in process........... 95,402 67,437 Raw material.............. 212,699 129,102 ----------- ---------- $ 460,610 $ 324,673 =========== ==========
If the first-in, first-out (FIFO) method had been used for inventories valued at LIFO cost, such inventories would have been $11,177,000 and $11,394,000 higher at December 31, 2000 and 1999, respectively. (4) Property, Plant and Equipment: The major classes of property, plant and equipment are summarized as follows (000's omitted):
December 31, 2000 December 31, 1999 ------------------ ----------------- Land and improvements.......... $ 29,692 $ 25,595 Buildings...................... 248,024 209,118 Machinery and equipment........ 930,388 818,200 ---------- ---------- 1,208,104 1,052,913 Less accumulated depreciation.. (632,573) (552,724) ---------- ---------- $ 575,531 $ 500,189 ========== ==========
(5) Financing: Financing consists of the following (000's omitted):
December 31, 2000 December 31, 1999 ----------------- ----------------- Notes payable due 2008....... $250,000 $250,000 Notes payable due 2005....... 282,780 -- Notes payable due 2003....... 30,000 30,000 Uncommitted lines of credit.. 115,000 55,000 Other........................ 117,410 39,634 -------- -------- 795,190 374,634 Less-currently payable....... 81,633 33,597 -------- -------- $713,557 $341,037 ======== ========
16 The Notes due 2008 were issued in October 1998 at an average interest cost of 6.1%. The carrying amount approximates fair value. The Notes due 2005 (the Eurobond Notes), with a stated amount of EU 300 million were issued in July 2000 and bear interest at 6.25% per annum. The carrying amount of the Eurobond Notes approximates fair value. The Notes due 2003 had an original average life of approximately 10 years and an average interest cost of 7%. The carrying amount approximates fair value. The borrowings under uncommitted lines of credit are principally short-term borrowings payable upon demand. The carrying amount approximates fair value. The weighted-average interest rate for short-term borrowings under the uncommitted lines of credit was 6.2%, 5.3% and 5.8% for each of the three years ended December 31, 2000. The Company also has a bank credit facility which provides revolving credit through September 30, 2001, of up to $250 million. The facility provides funds for general corporate purposes at an interest rate of LIBOR plus .125%. There were no borrowings under the bank facility during the three years ended December 31, 2000. The Company is charged a fee of .075% per annum for the facility. Commitment and facility fees of $190,000 were incurred in 2000, 1999 and 1998. The Company has complied with all debt covenants, including limitations on secured debt, sale and lease-back transactions, maintenance of working capital, net worth, debt levels, interest coverage, and payment of dividends. Uncommitted lines of credit and certain other debt are classified as noncurrent since management intends to refinance it and expects to use the proceeds of the LYONS (Note 14) to repay the debt. The minimum principal payments during the next five years are as follows: 2001 - $81,633,000; 2002 - $27,951,000; 2003 - $31,533,000; 2004 - $115,635,000; 2005 - $283,389,000; and $255,049,000 thereafter. (6) Accrued Expenses and Other Liabilities: Selected accrued expenses and other liabilities include the following (000's omitted):
December 31, 2000 December 31, 1999 ----------------- ----------------- Current Noncurrent Current Noncurrent -------- ---------- --------- ---------- Compensation and benefits $194,205 $68,618 $126,130 $54,057 Claims, including self- insurance and litigation 15,553 88,134 16,221 91,920 Postretirement benefits 5,000 77,400 5,000 73,006 Environmental and regulatory compliance 31,422 55,861 34,156 60,719 Taxes, income and other 137,018 66,499 45,065 7,950
Approximately $16.3 million of accrued expenses and other liabilities were guaranteed by bank letters of credit as of December 31, 2000. 17 (7) Pension and Employee Benefit Plans: The Company has noncontributory defined benefit pension plans which cover certain of its domestic hourly employees. Benefit accruals under most of these plans have ceased, and pension expense for defined benefit plans is not significant for any of the periods presented. It is the Company's policy to fund, at a minimum, amounts required by the Internal Revenue Service. In addition to providing pension benefits, the Company provides certain health care and life insurance benefits for some of its retired employees. Certain employees may become eligible for these benefits as they reach normal retirement age while working for the Company. The following sets forth the funded status of the plans as of the most recent actuarial valuations using a measurement date of September 30 (millions):
Pension Benefits Other Benefits ---------------------------- ------------------------------ 2000 1999 2000 1999 ------ ------ ------ ------ Change in benefit obligation Benefit obligation at beginning of year $249.8 $267.8 $ 63.7 $ 72.8 Service cost 13.4 12.9 0.3 0.5 Interest cost 20.5 17.2 4.8 4.7 Actuarial gain (loss) 7.6 (27.0) (2.3) (8.2) Acquisition 55.0 -- 6.7 -- Benefits paid (23.8) (21.1) (5.9) (6.1) ------ ------ ------ ------ Benefit obligation at end of year 322.5 249.8 67.3 63.7 Change in plan assets Fair value of plan assets at beginning of year 314.4 287.8 -- -- Actual return on plan assets 37.4 47.7 -- -- Acquisition 93.5 -- -- -- Benefits paid (23.8) (21.1) -- -- ------ ------ ------ ------ Fair value of plan assets at end of year 421.5 314.4 -- -- Funded status 99.0 64.6 (67.0) (63.7) Unrecognized net actuarial gain (42.1) (47.7) (15.4) (14.3) ------ ------ ------ ------ Prepaid (accrued) benefit cost $ 56.9 $ 16.9 $(82.4) $(78.0) ====== ====== ====== ====== Weighted-average assumptions as of December 31: Discount rate 7.75% 7.75% 7.75% 7.75% Expected return on plan assets 10.0% 10.0% -- --
18 For measurement purposes, an eight percent annual rate of increase in the per capita cost of covered health care benefits was assumed in 2001. The rate was assumed to decrease to six percent by 2002 and remain at that level thereafter. Components of net periodic benefit cost Service cost $ 13.4 $ 12.9 $ 0.3 $ 0.5 Interest cost 20.5 17.2 4.8 4.7 Expected return on plan assets (33.4) (27.4) -- -- Recognized net actuarial gain (2.2) (2.2) (1.8) (1.0) ------ ------ ----- ----- Net periodic benefit cost $ (1.7) $ 0.5 $ 3.3 $ 4.2 ====== ====== ===== =====
The Company acquired Kollmorgen Corporation on June 20, 2000, including their pension and postretirement benefit plans. The Company acquired American Precision Industries on March 27, 2000, including their pension plans. Assumed health care cost trend rates have a significant effect on the amounts reported for the health care plans. A one-percentage point change in assumed health care cost trend rates would have the following effects:
One-Percentage One-Percentage Point Increase Point Decrease -------------- -------------- Effect on total of service and interest cost components . . . . . . . . . . . . . . . . . $0.5 $(0.5) Effect on postretirement benefit obligation . . 6.8 (6.2)
Substantially all employees not covered by defined benefit plans are covered by defined contribution plans, which generally provide funding based on a percentage of compensation. Pension expense for all plans amounted to $36,555,000, $35,624,000 and $33,303,000 for the years ended December 31, 2000, 1999 and 1998, respectively. (8) Stock Transactions: The Company has adopted a non-qualified stock option plan for which it is authorized to grant options to purchase up to 15 million shares. Under the plan, options are granted at not less than existing market prices, expire ten years from the date of grant and generally vest ratably over a five-year period. Changes in stock options were as follows: 19
Number of Shares Under Option ------------- (thousands) Outstanding at December 31, 1997 10,127 (average $14.86 per share) Granted (average $43.11 per share) 1,154 Exercised (average $9.52 per share) (365) Cancelled (611) ------ Outstanding at December 31, 1998 (average $17.26 per share) 10,305 Granted (average $49.66 per share) 942 Exercised (average $9.54 per share) (738) Cancelled (292) ------ Outstanding at December 31, 1999 (average $20.48 per share) 10,217 ------ Granted (average $52.56 per share) 3,268 Exercised (average $12.95 per share) (1,615) Cancelled (1,119) ------ Outstanding at December 31, 2000 10,751 (at $5.03 to $68.31 per share, average ====== $31.65 per share)
As of December 31, 2000, options with a weighted average remaining life of 6.7 years covering 4,267,454 shares were exercisable at $5.03 to $60.38 per share (average $17.36 per share), and options covering 562,000 shares remain available to be granted. Options outstanding at December 31, 2000 are summarized below:
Outstanding Exercisable --------------------------------------- ------------------- Average Average Average Exercise Exercise Remaining Exercise Price Shares Price Life Shares Price -------- ------ -------- --------- ------ --------- (thousands) (thousands) $5.03 to $7.47 1,051 $ 6.44 2 years 1,051 $ 6.44 $7.97 to $11.75 755 10.20 3 years 755 10.20 $14.13 to $20.81 1,285 15.63 5 years 1,236 15.72 $21.25 to $32.22 3,124 24.11 6 years 742 23.89 $35.19 to $68.31 4,536 50.80 9 years 484 46.44
Nonqualified options have been issued only at fair market value exercise prices as of the date of grant during the periods presented herein, and the Company's policy does not recognize compensation costs for options of this type. The pro forma costs of these options granted have been calculated using the Black-Scholes option pricing model and assuming a 6% risk-free interest rate, a 10-year life for the option, a 37.6% expected volatility and dividends at the current annual rate. The weighted-average grant date fair market value of options issued was $32 per share in 2000, $28 per share in 1999 and $18 per share in 1998. Had this method been used in the determination of income, net earnings would have decreased by 20 approximately $17.9 million in 2000, $10.7 million in 1999 and $7.8 million in 1998 and diluted earnings per share would have decreased by $.12 in 2000, $.07 in 1999, and $.05 in 1998. These proforma amounts may not be representative of the effects on proforma net earnings for future years. (9) Leases and Commitments: The Company's leases extend for varying periods of time up to 10 years and, in some cases, contain renewal options. Future minimum rental payments for all operating leases having initial or remaining noncancelable lease terms in excess of one year are $33,000,000 in 2001, $26,000,000 in 2002, $20,000,000 in 2003, $15,000,000 in 2004, $11,000,000 in 2005 and $35,000,000 thereafter. Total rent expense charged to income for all operating leases was $35,000,000, $34,000,000 and $32,000,000 for the years ended December 31, 2000, 1999 and 1998, respectively. (10) Litigation and Contingencies: A former subsidiary of the Company is engaged in litigation in multiple states with respect to product liability. The Company sold the subsidiary in 1987. Under the terms of the sale agreement, the Company agreed to indemnify the buyer of the subsidiary for product liability related to tools manufactured by the subsidiary prior to June 4, 1987. The cases involve approximately 3,000 plaintiffs in state and federal courts in multiple states. All other major U.S. air tool manufacturers are also defendants. The gravamen of these complaints is that the defendants' air tools, when used in different types of manufacturing environments over extended periods of time, were defective in design and caused various physical injuries. The plaintiffs seek compensatory and punitive damages. The Company has accepted an agreement, in principle, to settle these claims. Completion of this settlement agreement will not result in a material adverse effect on the Company's results of operations or financial condition. A subsidiary, Joslyn Manufacturing Company (JMC), previously operated wood- treating facilities that chemically preserved utility poles, pilings and railroad ties. All such treating operations were discontinued or sold prior to 1982. These facilities used wood preservatives that included creosote, pentachlorophenol and chromium-arsenic-copper. While preservatives were handled in accordance with then existing law, environmental law now imposes retroactive liability, in some circumstances, on persons who owned or operated wood-treating sites. JMC is remediating some of its former sites and will remediate other sites in the future. The Company has made a provision for environmental remediation; however, there can be no assurance that estimates of environmental liabilities will not change. In addition to the litigation noted above, the Company is, from time to time, subject to routine litigation incidental to its business. These lawsuits primarily involve claims for damages arising out of the use of the Company's products, some of which include claims for punitive as well as compensatory damages. The Company is also involved in proceedings with respect to environmental matters, including sites where it has been identified as a potentially responsible party under federal and state environmental laws and regulations. The Company believes that the results of the above-noted litigation and other pending legal proceedings will not have a materially adverse effect on the Company's results of operations or financial condition, notwithstanding any related insurance recoveries. A subsidiary of the Company has sold, with limited recourse, certain of its accounts and notes receivable. The subsidiary accounts for this sale in accordance with Statement of Financial Accounting Standards (SFAS) No. 125, "Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities". A provision for estimated losses as a result of the limited recourse has been included in accrued expenses. No gain or loss arose from these transactions. 21 (11) Income Taxes: The provision for income taxes for the years ended December 31 consists of the following (000's omitted):
2000 1999 1998 -------- -------- -------- Federal: Current.............. $ 85,955 $111,809 $ 90,560 Deferred............. 67,150 16,139 12,151 State and local....... 12,645 11,665 6,647 Foreign............... 32,961 28,325 15,465 -------- -------- -------- Income tax provision.. $198,711 $167,938 $124,823 ======== ======== ========
Deferred income taxes are reflected in prepaid expenses and other current assets and in other assets. Deferred tax assets consist of the following (000's omitted):
December 31, ------------------- 2000 1999 -------- -------- Bad debt allowance............. $ 14,555 $ 10,242 Inventories.................... 7,672 9,913 Property, plant and equipment.. (47,952) (41,564) Postretirement benefits........ 37,276 33,827 Insurance, including self- insurance..................... 27,886 27,108 Environmental compliance....... 22,979 23,946 Other accruals................. (15,594) 15,538 All other accounts............. (46,044) (19,575) -------- -------- Net deferred tax asset......... $ 778 $ 59,435 ======== ========
The effective income tax rate for the years ended December 31 varies from the statutory federal income tax rate as follows:
Percentage of Pre-tax Earnings --------------------------------- 2000 1999 1998 ---- ---- ---- Statutory federal income tax rate................. 35.0% 35.0% 35.0% Increase (decrease) in tax rate resulting from: Permanent differences in amortization of certain assets for tax and financial reporting purposes..................................... 3.1 2.7 3.7 State income taxes (net of Federal income tax benefit)..................................... 1.6 1.8 1.4 Taxes on foreign earnings...................... (1.7) (0.9) (1.4) Costs of Hach (1999) and Fluke (1998) mergers.. -- 0.5 0.7 ---- ---- ---- Effective income tax rate......................... 38.0% 39.1% 39.4% ==== ==== ====
22 (12) Segment Data: Operating profit represents total revenues less operating expenses, excluding other expense, interest and income taxes. The identifiable assets by segment are those used in each segment's operations. Intersegment amounts are eliminated to arrive at consolidated totals. Detailed segment data is presented in the following table (000's omitted): Operations in Different Industries - ----------------------------------
Year Ended December 31, --------------------------------------------------- 2000 1999 1998 ---------- ---------- ---------- Total Sales: Process/Environmental Controls $2,441,986 $1,854,184 $1,752,552 Tools and Components 1,335,791 1,343,054 1,294,509 ---------- ---------- ---------- $3,777,777 $3,197,238 $3,047,061 ========== ========== ========== Operating Profit: Process/Environmental Controls $ 382,354 $ 286,997 $ 239,794 Tools and Components 189,062 187,511 159,225 Other (19,267) (16,501) (14,907) ---------- ---------- ---------- $ 552,149 $ 458,007 $ 384,112 ========== ========== ========== Identifiable Assets: Process/Environmental Controls $2,863,930 $1,793,873 $1,783,142 Tools and Components 987,207 995,234 994,364 Other 180,542 257,964 63,353 ---------- ---------- ---------- $4,031,679 $3,047,071 $2,840,859 ========== ========== ========== Liabilities: Process/Environmental Controls $1,026,463 $ 596,332 $ 595,360 Tools and Components 347,484 381,025 374,726 Other 715,399 360,960 469,985 ---------- ---------- ---------- $2,089,346 $1,338,317 $1,440,071 ========== ========== ========== Depreciation and Amortization: Process/Environmental Controls $ 101,605 $ 81,647 $ 69,416 Tools and Components 48,116 44,772 45,111 ---------- ---------- ---------- $ 149,721 $ 126,419 $ 114,527 ========== ========== ========== Capital Expenditures: Process/Environmental Controls $ 51,067 $ 53,358 $ 61,422 Tools and Components 37,436 35,551 40,192 ---------- ---------- ---------- $ 88,503 $ 88,909 $ 101,614 ========== ========== ==========
23 Operations in Geographical Areas - --------------------------------
Year Ended December 31, ----------------------------------------------- 2000 1999 1998 ---------- ---------- ---------- Total sales: United States.................. $2,883,392 $2,507,517 $2,418,500 Germany........................ 199,064 166,268 151,136 United Kingdom................. 154,731 138,066 123,511 All other...................... 540,590 385,387 353,914 ---------- ---------- ---------- $3,777,777 $3,197,238 $3,047,061 ========== ========== ========== Long-lived assets: United States.................. $2,418,590 $1,747,086 $1,821,142 Germany........................ 29,405 22,101 22,931 United Kingdom................. 22,134 24,967 21,157 All other...................... 87,244 50,800 43,933 Less: Deferred taxes................ (778) (59,435) (75,574) ---------- ---------- ---------- $2,556,595 $1,785,519 $1,833,589 ========== ========== ========== Sales outside the United States: Direct Sales................... $ 894,385 $ 689,721 $ 628,561 Exports........................ 298,000 263,000 259,000 ---------- ---------- ---------- $1,192,385 $ 952,721 $ 887,561 ========== ========== ===========
(13) Quarterly Data-Unaudited (000's omitted, except per share data) 2000 ---------------------------------------------------------- 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter ----------- ----------- ----------- ----------- Net sales......................... $867,847 $890,775 $986,786 $1,032,369 Gross profit...................... 329,889 349,590 386,972 395,595 Operating profit.................. 117,629 136,665 146,844 151,011 Net earnings...................... 71,557 81,267 83,625 87,764 Earnings per share: Basic........................ $ .50 $ .57 $ .59 $ .62 Diluted...................... $ .49 $ .56 $ .58 $ .60
24
1999 ---------------------------------------------------------- 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter ----------- ----------- ----------- ----------- Net sales....................... $793,044 $774,133 $781,867 $848,194 Gross profit.................... 295,484 301,930 311,068 327,934 Operating profit................ 102,681 113,857 119,216 122,253 Net earnings.................... 59,122 66,353 61,846* 74,303 Earnings per share: Basic...................... $ .42 $ .47 $ .43* $ .52 Diluted.................... $ .41 $ .46 $ .42* $ .51
* Includes $9.8 million in after-tax costs ($0.07 per share) from the merger with Hach Company (14) Subsequent Events In January 2001, the Company acquired United Power Corporation. The consideration was approximately $108 million. The fair value of the assets acquired was approximately $118 million and approximately $10 million of liabilities were assumed. The transaction is being accounted for as a purchase. In January 2001, the Company issued $722 million (value at maturity) in zero-coupon convertible senior notes due 2021 known as Liquid Yield Option Notes or LYONS. The gross proceeds to the Company of approximately $450 million will be used to pay down debt and for general corporate purposes, including potential future acquisitions. The initial purchaser has a 30 day option to purchase additional LYONS to cover over-allotments, which would give the Company approximately $68 million in additional gross proceeds. The LYONS will be convertible into approximately 5.2 million common shares of the Company assuming the over-allotment option is not exercised. The LYONS carry a yield to maturity of 2.375%. The LYONS are not redeemable by the Company prior to January 22, 2004, but it may be required to purchase LYONS at the accreted value thereof, at the option of the holders, on January 22, 2004 or 2011. The Company may choose to pay the purchase price for the repurchases in cash and/or common shares. 25 Danaher Corporation and Subsidiaries - ------------------------------------ Major Operating Company Presidents Current Technology, Inc. Joseph W. Roark President Cyberex, Inc. Maureen F. Austin President Danaher Industrial Controls Group Craig B. Purse President Danaher Motion Control Group General Purpose Systems Division John S. Stroup President Danaher Motion Control Group Motion Components Division William T. Fejes, Jr. President Danaher Motion Control Group Special Purpose Systems Division Lawrence D. Kingsley President Danaher Tool Group Professional Tools Division Jake R. Nichol President Danaher Tool Group Special Markets Division Thomas R. Sulentic President Delta Consolidated Industries Thomas P. Joyce, Jr. President Dr. Bruno Lange GmbH Dr. Michael Romberg President Fluke Corporation James A. Lico President Fluke Networks Chris L. Odell President Gems Sensors Steven E. Breitzka President Hach Company Steven E. Simms President (Acting) Hennessy Industries, Inc. Vincent E. Piacenti President Jacobs Chuck Manufacturing Company C. Michael Heath President Jacobs Vehicle Systems, Inc. Gary A. Masse President Jennings Technology Company Kurt F. Gallo President Joslyn Hi-Voltage Company James F. Domo President Joslyn Manufacturing Company Michael J. Gallant President Joslyn Sunbank Company P. Edward Prutzman President Kollmorgen Artus Robert Perrin President Kollmorgen Electro-Optical Division H. Kenyon Bixby President M&M Precision Systems Corporation Gerald W. Blankenship President Matco Tools Corporation Thomas N. Willis President Pacific Scientific Company Instruments Division Simon R. Appleby President Pacific Scientific Energetic Materials Company Thomas L. Walsh President Pacific Scientific Safety & Aviation Group Richard G. Knoblock President QualiTROL Corporation Ronald N. Meyer President United Power Corporation Robert J. Van Sickle President Veeder-Root Industries Scott Clawson President Corporate Officers George M. Sherman President and Chief Executive Officer H. Lawrence Culp, Jr. Executive Vice President and Chief Operating Officer 26 Patrick W. Allender Executive Vice President, Chief Financial Officer and Secretary Philip W. Knisely Executive Vice President Steven E. Simms Executive Vice President William J. Butler Vice President and Group Executive Thomas S. Gross Vice President and Group Executive Daniel L. Comas Vice President - Corporate Development James H. Ditkoff Vice President - Finance & Tax W. Bruce Graham Vice President - Danaher Business System Dennis A. Longo Vice President - Human Resources Christopher C. McMahon Vice President - Controller Daniel A. Pryor Vice President - Strategic Development Uldis K. Sipols Vice President - Procurement Directors Mortimer M. Caplin Partner Caplin & Drysdale Donald J. Ehrlich President, Chairman and Chief Executive Officer Wabash National Corp. Walter G. Lohr, Jr. Partner Hogan & Hartson Mitchell P. Rales Chairman of the Executive Committee Danaher Corporation Steven M. Rales Chairman of the Board Danaher Corporation George M. Sherman President and Chief Executive Officer Danaher Corporation Alan G. Spoon General Partner Polaris Venture Partners A. Emmet Stephenson, Jr. Chairman of the Board Startek, Inc. 27 EX-21 5 dex21.txt EXHIBIT 21 Exhibit 21 DANAHER CORPORATION & SUBSIDIARIES EXHIBIT TO 2000 ANNUAL REPORT ON FORM 10K (21) SUBSIDIARIES OF REGISTRANT 1 Danaher Corporation 2 DHR Nova Scotia ULC 3 Danaher Canadian Finance LP 4 DMG Plastics, Inc. 5 FJ 900 Inc. 6 Danaher Insurance Company 7 Utica Holding Company 8 Fluke Corporation 9 Fluke Networks, Inc. 10 Fluke Electronics Corporation 11 Fluke International Corporation 12 Fluke China (Hong Kong) Ltd. 13 Fluke Deutschland GmbH 14 Fluke Electronics (Malaysia) And.Bhd. 15 Fluke Southeast Asia Pte.Ltd. 16 KK Fluke Japan 17 Fluke Australia Pty Ltd 18 Fluke do Brazil Ltda. 19 Fluke Europe B.V. 20 Fluke UK Ltd. 21 Fluke Iberica SL 22 Fluke Italia S.r.l. 23 Warner Electric S.r.l. 24 Fluke Holding B.V. 25 Fluke Industrial B.V. 26 Fluke Nederland B.V. 27 Fluke Vertriebsgesellschaft m.b.H 28 Fluke Belgium N.V./S.A. 29 Fluke Danmark A/S 30 Fluke Finland Oy 31 Fluke France S.A. 32 Fluke Norge A/S 33 Fluke Sveriga AB 34 Contronic Development AB 35 Proces-Styring APS 36 Prosess-Styring AS 37 Advanced Motion Controls AB 38 Inmotion AB 39 Inmotion Elesta AG 40 Inmotion GmbH 41 Inmotion SRL 42 Inmotion SA 43 Warner Electric SA 44 Warner Electric AB 45 Fluke Switzerland AG 46 DH Holdings Corp. 47 DCI Consolidated Industries, Inc. 48 Delta Consolidated Industries, Inc. 49 Truck Storage Incorporated 50 Danaher Finance Company 51 Sonix, Inc. 52 Sonix Technologies SDV.BHD. 53 Gems Sensors Inc. 54 Industrial Sensors, Inc. 55 Jacobs Chuck Manufacturing Company 56 Jacobs Chuck Mfg. (Suzhou) Co. Ltd. 57 Jacobs Chuck Trading (Shanghai) Co. Ltd. 58 Jacobs Japan Inc. 59 Power Tool Holders Incorporated 60 Kistler-Morse Corporation 61 United Power Corporation 62 Jessie & J Company, Ltd. 63 Gems Sensors (WEKA) AG 64 Danaher Alberta, Inc. 65 Partlow Corporation 66 Anderson Instrument Co., Inc. 67 Flow Measurement Corporation 68 Western Pacific Industries, Inc. 69 Swiss Precision Parts Corp. 70 Easco Hand Tools, Inc. 71 Hand Tool design Corporation 72 K-D Tools of Puerto Rico, Inc. 73 Holo-Krome Company 74 The Allen Manufacturing Company 75 Industrial Fasteners, Inc. 76 Quality Wire Processing, Inc. 77 Holo-Krome Australia Pty Ltd. (51%) 78 Danaher Canada, Inc. 79 Veeder-Root Company 80 Launchchange Holding Company 81 Veeder-Root Finance Company 82 Launchchange Limited 83 Hengstler Industries Ltd. 84 Jacobs Holding Company 85 Spline Gauges Ltd. 86 West Instruments Ltd. 87 Veeder-Root Environmental Systems Ltd. 88 Gwendolene Holdings Ltd. 89 Gems Sensors Ltd. 90 Holo-Krome Ltd. 91 Jacobs Manufacturing Co. Ltd. 92 Piccadilly Precision Engineering Ltd. 93 Danaher UK Industries Ltd. 94 Pacific Scientific Ltd. 95 Royce Thompsen Ltd. 96 Wavetek Ltd. 97 Fluke Precision Measurements Ltd. 98 Datron Instruments Ltd. 99 Robin Electronics Ltd. 100 CGF Automation Ltd. 101 Contents Measuring Systems Ltd. 102 Veeder-Root Ltd. 103 QualiTROL Instruments Ltd. 104 Buhler Montec Group Ltd. 105 EPIC Products Ltd. 106 Petroleum Industry Controls, Inc. 107 Veeder-Root Service Company 108 Veeder-Root do Brasil 109 Jacobs Chuck (Hong Kong) Ltd. 110 Armstrong Tools, Inc. 111 Old Tide Corp. 112 Jacobs Vehicle Systems, Inc. 113 Jacobs Mexico, S.A. de C.V. 114 Diesel Engine Retarders, Inc. 115 McCrometer, Inc. 116 Beamco, Inc. 117 Hach Company 118 Hach Europe, S.A. 119 Hach Sales & Service Canada Ltd. 120 Environmental Test Systems, Inc. 121 Lea Way Hand Tool Corporation 122 Joslyn Holding Company 123 Joslyn Company, LLC 124 Joslyn Manufacturing Company, LLC 125 Joslyn Electronic Systems Company, LLC 126 Joslyn Hi-Voltage Company, LLC 127 Joslyn Clark Controls, LLC 128 Sunbank Family of Companies, LLC 129 Joslyn Sunbank Company, LLC 130 Jennings Technology Company, LLC 131 Jennings Land Company 132 Cyberex, LLC 133 Cyberex, B.V. 134 Danaher Canadian Holdings Inc. 135 Hennessy Canada LLC 136 Danaher Tool Group LP 137 Fluke Electronics Canada LP 138 Joslyn Canada 139 Hengstler Canada LP 140 QualiTROL Canada LP 141 Hennessy Industries Canada LP 142 Danaher Nova Scotia ULC 143 Kingsley Tools, Inc. 144 Newtown Manufacturing Company, Inc. 145 Acme-Cleveland Corp. 146 AC Intermediate Co. 147 143420 Ontario, Inc. 148 Acme-Cleveland Laser Systems, Inc. (89%) 149 Namco Controls Corp. 150 Ball Screws and Actuators Co., Inc. 151 Communications Technology Corp. 152 Communications Technology (Canada) Ltd. 153 Communications Technology Corp. Mexico, S.A. 154 Phoenix Microsystems, Inc. 155 Dolan-Jenner Industries, Inc. 156 Dolan-Jenner Europe, B.V. (60%) 157 M & M de France, Inc. 158 M & M Precision Systems Corp. 159 Master Gears Corp. 160 Precision Gauges, Inc. 161 Hennessy Industries, Inc. 162 Service Station Products Company 163 Dynapar Corporation 164 Hengstler Espana S.A. 165 Current Technology, Inc. 166 GID Acquisition Company 167 Data Recorders Incorporated 168 Hecon Properties, Inc. 169 Hengstler Italia SRL 170 Gems Sensors SRL 171 Hengstler Japan Corp. 172 Matco Tools Corporation 173 Mechanics Custom Tools Corporation 174 NMTC, Inc. 175 Pacific Scientific Company 176 Pacific Scientific Instruments Company 177 Fisher Pierce Company 178 Pacific Scientific Energetic Materials Co. 179 Wermex Corporation 180 Bobinas de Sur 181 Pacific Scientific International Holding 182 Advanced Servo Sytems Limited 183 Light Controls Corp. 184 JS Technology, Inc. 185 Securaplane Technologies, Inc. 186 Danaher Canada Partners Inc. 187 QualiTROL Corporation 188 Danaher Finance Company, LLC 189 Danaher Holding GmbH 190 QualiTROL GmbH 191 Dr. Bruno Lange Verwaltungs GmbH 192 Warner Electric GmbH 193 Hengstler GmbH 194 KACO GmbH 195 Hengstler Controle Numerique SARL 196 Societe Civile Immobiliere 197 Gems Sensors GmbH 198 Veeder-Root GmbH 199 Dr. Bruno Lange GmbH & Co. KG 200 Dr. Bruno Lange AG 201 Dr. Bruno Lange Ges.m.b.H 202 Dr. Bruno Lange SARL 203 Dr. Bruno Lange SRL 204 Dr. Bruno Lange (UK) Ltd. 205 Dr. Lange Belgie B.V.B.A. 206 Dr. Lange Danmark A/S 207 Dr. Lange Nederland B.V. 208 Dr. Lange Sp.ZOO 209 Neurtek Medio Ambiente S.A. 210 Namco Controls GmbH 211 Cleveland Precision Systems GmbH 212 Pacific Scientific GmbH 213 Eduard Bautz GmbH & Co. KG 214 PMI Motion Technologies GmbH 215 PMI Verwaltungs GmbH 216 Kollmorgen Seidel GmbH & Co. KG 217 SMB GmbH 218 API Schmidt-Bretten Beteiligungs GmbH 219 API Schmidt-Bretten Verwaltungs GmbH 220 API Schmidt-Bretten GmbH & Co. KG 221 Schmidt-Bretten Nederland BV 222 Danaher GbR 223 Power Transformer Controls Company 224 American Precision Industries Inc. 225 API Gettys Inc. 226 API Harowe (St. Kitts) Ltd. 227 API Portescap 228 API Portescap International 229 API Portescap Deutschland GmbH 230 API Portescap Scandinavia AB 231 API Portescap Polska Sp.zoo 232 API Positran Ltd. 233 API Portescap (UK) Ltd. 234 API Portescap France SA 235 API Portescap Japan Ltd. 236 API Heat Transfer Inc. 237 American Precision Industries (U.K.) Ltd. 238 API Development Corporation 239 Portescap U.S. Inc. 240 API of Canada, Inc. 241 Kollmorgen Corporation 242 Kollmorgen Securities Corporation 243 Kollmorgen Overseas Development Corp. 244 Kollmorgen International LLC 245 PacSci Motion Control, Inc. 246 Superior Electric Holding LLC 247 Warner Linear LLC 248 Precision Specialties, Inc. 249 Kollmorgen SAS 250 AB Kiklstroms Manometerfabrik 251 KB Instrumate 252 API Elmo AB 253 Kollmorgen Artus S.A. 254 Cryla S.A. 255 Kollmorgen Artus Vietnam Co. Ltd. 256 Pacific Scientific SARL 257 Veeder-Root SARL 258 Gems Sensors SARL 259 Radiometer Analytical S.A. 260 Buhler Montec S.A. 261 Polymetron S.A. 262 Calzoni S.p.A. 263 Kollmorgen Italia S.r.l. 264 Servotech Control Technology Ltd. 265 Kollmorgen Asia Investment Company 266 Tianjin Kollmorgen Industrial Drives Ltd. 267 Kollmorgen Asia Investment Company BV 268 Jachymova Securities s.r.o. 269 SEMCON, a.s. 270 SMB s.r.o. 271 Kollmorgen India Invest. Co. Mauritius 272 Kollmorgen [Tandon] India 273 Kollmorgen Servotronix Ltd EX-23 6 dex23.txt EXHIBIT 23 EXHIBIT 23 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation of our reports included (or incorporated by reference) in this Form 10-K, into the Company's previously filed Registration Statement File No. 33-32402. ARTHUR ANDERSEN LLP Baltimore, Maryland March 27, 2001 -----END PRIVACY-ENHANCED MESSAGE-----