DIONEX CORPORATION
501 MERCURY DRIVE
SUNNYVALE, CALIFORNIA 94085
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON OCTOBER 27, 2000
TO THE STOCKHOLDERS OF DIONEX CORPORATION:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Dionex
Corporation, a Delaware corporation (the "Company"), will be held at Dionex
Corporation, 501 Mercury Drive, Sunnyvale, California, on Friday, October 27,
2000 at 9:00 a.m. for the following purposes:
1. To elect directors to serve for the ensuing year and until their successors
are elected.
2. To ratify the selection of Deloitte & Touche LLP as the Company's independent
auditors for its fiscal year ending June 30, 2001.
3. To transact such other business as may properly come before the meeting or
any adjournment or postponement thereof.
The foregoing items of business are more fully described in the Proxy Statement
accompanying this Notice.
The Board of Directors has fixed the close of business on September 11, 2000 as
the record date for the determination of stockholders entitled to notice of
and to vote at this Annual Meeting and at any adjournment or postponement
thereof.
BY ORDER OF THE BOARD OF DIRECTORS
JAMES C. GAITHER
Secretary
Sunnyvale, California
September 11, 2000
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE, SIGN AND
RETURN THE ENCLOSED PROXY. STOCKHOLDERS WITH SHARES REGISTERED DIRECTLY WITH
THE COMPANY'S TRANSFER AGENT, EQUISERVE, L.P. ("EQUISERVE"), MAY CHOOSE TO VOTE
THOSE SHARES VIA THE INTERNET AT EQUISERVE'S VOTING WEB SITE
(WWW.EPROXYVOTE.COM/DNEX), OR THEY MAY VOTE TELEPHONICALLY, WITHIN THE U.S.
ONLY, BY CALLING EQUISERVE AT 1 (877) 779-8683 (TOLL-FREE), OR FOR STOCKHOLDERS
RESIDING OUTSIDE THE U.S. BY CALLING COLLECT ON A TOUCH-TONE PHONE AT (201) 536-
8073. STOCKHOLDERS HOLDING SHARES WITH A BROKER OR BANK MAY ALSO BE ELIGIBLE
TO VOTE VIA THE INTERNET OR TO VOTE TELEPHONICALLY IF THEIR BROKER OR BANK
PARTICIPATES IN THE PROXY VOTING PROGRAM PROVIDED BY ADP INVESTOR COMMUNICATION
SERVICES. SEE "VOTING VIA THE INTERNET OR BY TELEPHONE" IN THE PROXY
STATEMENT FOR FURTHER DETAILS.
DIONEX CORPORATION
501 Mercury Drive
Sunnyvale, California 94085
2000 Proxy Statement
Information Concerning Solicitation and Voting
General
The enclosed proxy is solicited on behalf of the Board of Directors of the
Company (the "Board") for use at the Annual Meeting of Stockholders to be
held on Friday, October 27, 2000, at 9:00 a.m. local time (the "Annual
Meeting"), or at any adjournment or postponement thereof, for the purposes
set forth herein and in the accompanying Notice of Annual Meeting. The Annual
Meeting will be held at Dionex Corporation, 501 Mercury Drive, Sunnyvale,
California.
Solicitation
The Company will bear the entire cost of solicitation of proxies, including
preparation, assembly, printing and mailing of this proxy statement, the proxy
and any additional information furnished to stockholders. Copies of
solicitation materials will be furnished to banks, brokerage houses,
fiduciaries and custodians holding in their names shares of Common Stock
beneficially owned by others to forward to such beneficial owners. The
Company may reimburse persons representing beneficial owners of Common Stock
for their costs of forwarding solicitation materials to such beneficial
owners. Original solicitation of proxies by mail may be supplemented by
telephone, telegram or personal solicitation by directors, officers or other
regular employees of the Company. No additional compensation will be paid
to directors, officers or other regular employees for such services.
The Company intends to mail this proxy statement and accompanying proxy card on
or about September 15, 2000, to all stockholders entitled to vote at the
Annual Meeting.
Voting Via the Internet or by Telephone
If you hold your shares directly registered
in your name with EquiServe:
If you hold your shares in an account with a
broker or bank that participates in the ADP
Investor Communication Services program:
To vote by phone (within the U.S. only, call
toll-free) 1 (877) 779-8683, or (outside of the
U.S., call collect on a touch-tone phone),
(201) 536-8073
To vote via the Internet:
www.eproxyvote.com/dnex
To vote by phone: your voting form from your broker
or bank will show the telephone number to call.
To vote via the Internet
www.proxyvote.com
For Shares Directly Registered in the Name of the Stockholder. Stockholders
with shares registered directly with EquiServe may vote those shares
telephonically by calling EquiServe at 1 (877) 779-8683 (within the U.S.
only, toll-free), or via the Internet at EquiServe's voting Web site
(www.eproxyvote.com/dnex).
For Shares Registered in the Name of a Broker or Bank. A number of brokers
and banks are participating in a program provided through ADP Investor
Communication Services that offers telephone and Internet voting options.
This program is different from the program provided by EquiServe for shares
registered directly in the name of the stockholder. If your shares are held in
an account with a broker or bank participating in the ADP Investor
Communication Services program, you may vote those shares telephonically by
calling the telephone number shown on the voting form received from your
broker or bank, or via the Internet at ADP Investor Communication Services'
voting Web site (www.proxyvote.com).
General Information for All Shares Voted Via the Internet or By Telephone.
Votes submitted via the Internet or by telephone must be received by 12:00
midnight, Eastern Standard Time, on October 26, 2000. Submitting your proxy
via the Internet or by telephone will not affect your right to vote in person
should you decide to attend the Annual Meeting. Please note, however, that if
your shares are held of record by a broker, bank or other nominee and you
wish to vote at the meeting, you must bring to the meeting a letter from the
broker, bank or other nominee confirming your beneficial ownership of the
shares. Additionally, in order to vote at the meeting, you must obtain from the
record holder a proxy issued in your name.
The telephone and Internet voting procedures are designed to authenticate
stockholders' identities, to allow stockholders to give their voting
instructions and to confirm that stockholders' instructions have been
recorded properly. Stockholders voting via the Internet should understand that
there may be costs associated with electronic access, such as usage charges from
Internet access providers and telephone companies, that must be borne by the
stockholder.
Voting Rights and Outstanding Shares
Only holders of record of Common Stock at the close of business on September 11,
2000 will be entitled to notice of and to vote at the Annual Meeting. At the
close of business on September 11, 2000, the Company had outstanding and
entitled to vote 22,048,824 shares of Common Stock. Each holder of record
of Common Stock on such date will be entitled to one vote for each share held
on all matters to be voted upon at the Annual Meeting.
All votes will be tabulated by the inspector of election appointed for the
meeting, who will separately tabulate affirmative and negative votes,
abstentions and broker non-votes. Abstentions will be counted towards the
tabulation of votes cast on proposals presented to the stockholders and will
have the same effect as negative votes. Broker non-votes are counted towards
a quorum, but are not counted for any purpose in determining whether a matter
has been approved.
Revocability of Proxies
Any person giving a proxy pursuant to this solicitation has the power to revoke
it at any time before it is voted. It may be revoked by filing with the
Secretary of the Company at the Company's principal executive office,
501 Mercury Drive, Sunnyvale, California 94085, a written notice of
revocation or a duly executed proxy bearing a later date, or it may be revoked
by attending the meeting and voting in person. Attendance at the meeting will
not, by itself, revoke a proxy.
Stockholder Proposals
The deadline for submitting a stockholder proposal for inclusion in the
Company's proxy statement and form of proxy for the Company's 2001 annual
meeting of stockholders pursuant to Rule 14a-8 of the Securities and Exchange
Commission (the "SEC") is May 14, 2001. The deadline for submitting a
stockholder proposal or a nomination for director that is not to be
included in such proxy statement and proxy is July 30, 2001. Stockholders are
also advised to review the Company's Bylaws, which contain additional
requirements with respect to advance notice of stockholder proposals and
director nominations.
PROPOSAL 1
ELECTION OF DIRECTORS
There are five nominees for the five Board positions presently authorized in
the Company's Bylaws. Each director to be elected will hold office until the
next annual meeting of stockholders and until his successor is elected and
has qualified, or until such director's earlier death, resignation or
removal. Each nominee listed below is currently a director of the Company,
having been elected by the stockholders.
Shares represented by executed proxies will be voted, if authority to do so is
not withheld, for the election of the five nominees named below. If any
nominee should be unavailable for election as a result of an unexpected
occurrence, such shares will be voted for the election of such substitute
nominee as management may propose. Each person nominated for election has
agreed to serve if elected, and management has no reason to believe that any
nominee will be unable to serve. Directors are elected by a plurality of the
votes of the holders of Common Stock present in person or represented by
proxy and entitled to vote.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF EACH NAMED NOMINEE.
Nominees
The following information pertains to the nominees, their principal occupations
for the preceding five-year period, certain directorships, and their ages as
of August 31, 2000.
Name Age Principal Occupation/Positions
Held with the Company
David L. Anderson 56 Managing Director of the general partner,
Sutter Hill Ventures
James F. Battey 79 Independent Investor
A. Blaine Bowman 54 President and Chief Executive Officer
B.J. Moore 64 Management Consultant
Riccardo Pigliucci 53 Chairman and Chief Executive Officer,
Discovery Partners International
Mr. Anderson has been the managing director of the general partner of Sutter
Hill Ventures, a venture capital investment partnership, since 1974.
Mr. Anderson has served as a director of the Company since it began
operations in 1980 and previously served as a director of the predecessor
of the Company. Mr. Anderson is also a director of Cytel Corporation, Neurex
Corporation, BroadVision, Inc. and Molecular Devices Corporation and
various private companies.
Dr. Battey was President and Chief Executive Officer of Psi Star, Inc., which
manufactured equipment used in the production of computer circuit boards, from
1981 until May 1987, and Chairman of the Board of Psi Star from May 1987
until his retirement in May 1990. Dr. Battey has served as a director of the
Company since it began operations in 1980 and previously served as a director
of the predecessor of the Company.
Mr. Bowman has served as the Company's President and Chief Executive Officer and
as a director since the Company began operations in 1980. Mr. Bowman is also a
director of Molecular Devices Corporation.
Mr. Moore is an independent management consultant. From December 1985 until
July 1991, he was President of Outlook Technology, Inc., a company that
manufactured and sold high performance instrumentation and was merged with
Biomation Corporation in August 1991. He has served as a director of the
Company since it began operations in 1980 and previously served as a director
of the predecessor of the Company. Mr. Moore is also a director of Adaptec,
Inc. and American Xtal Technology, Inc.
Mr. Pigliucci is Chairman and Chief Executive Officer of Discovery Partners
International, a supplier of equipment and services to the drug discovery
market. From 1996 to 1997, Mr. Pigliucci was Chief Executive Officer of Life
Sciences International, a supplier of scientific equipment and consumables to
research, clinical and industrial markets. Prior to that, he held numerous
management positions during his 23-year career at Perkin-Elmer Corporation,
a life science and analytical instrument company, including President and
Chief Operating Officer from 1993 to 1995. He was elected as a director of
the Company in March 1998. Mr. Pigliucci is also a director of Biosphere
Medical Corporation and Epoch Pharmaceutical, Inc.
Meetings; Committees
During the fiscal year ended June 30, 2000, the Board held four meetings. The
Board has two committees, an Audit Committee and a Compensation Committee.
The Audit Committee recommends engagement of the Company's independent auditors,
approves services performed by such auditors, and reviews and evaluates the
Company's accounting system and its system of internal accounting controls.
During fiscal 2000, the Audit Committee consisted of Messrs. Anderson, Moore
and Pigliucci and Dr. Battey and held one meeting. Mr. Anderson resigned
from the Audit Committee effective July 1, 2000.
The Compensation Committee reviews and administers the compensation of the
Company's officers and certain members of senior management of the Company.
The members of the Compensation Committee are Messrs. Anderson, Moore and
Pigliucci and Dr. Battey. During the fiscal year ended
June 30, 2000, the Compensation Committee held three meetings.
During the fiscal year ended June 30, 2000, each Board member attended 100% of
the meetings of the Board and the committees upon which such member served.
PROPOSAL 2
APPROVAL OF INDEPENDENT AUDITORS
Deloitte & Touche LLP ("Deloitte & Touche") has served as the Company's
independent auditors with respect to the Company's books and accounts since
the Company began operations in 1980.
The stockholders are being asked to ratify the approval of Deloitte & Touche as
independent auditors for the fiscal year ending June 30, 2001. Although it is
not required to do so, the Board is submitting the approval of
Deloitte & Touche to the stockholders for ratification as a matter of good
corporate practice. Should the stockholders fail to provide such ratification,
the Board would reconsider its approval of Deloitte & Touche as independent
auditors for the fiscal year ending June 30, 2001. Even if the selection is
ratified, the Board in its discretion may direct the appointment of a different
independent auditing firm at any time during the year if the Board determines
that such a change would be in the best interests of the Company and its
stockholders.
Representatives of Deloitte & Touche are expected to be present at the Annual
Meeting of Stockholders. They do not expect to make any statement, but will
have the opportunity to make a statement if they desire to do so and will be
available to respond to appropriate questions.
The affirmative vote of the holders of a majority of the Common Stock present in
person or represented by proxy and entitled to vote on the proposal at the
Annual Meeting will be required to ratify the selection of Deloitte & Touche.
THE BOARD OF DIRECTORS RECOMMENDS RATIFICATION OF THE SELECTION OF
DELOITTE & TOUCHE.
SECURITY OWNERSHIP
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the ownership of
the Company's Common Stock as of August 1, 2000 by (i) each director,
(ii) each Named Executive Officer (as defined under "Executive
Compensation"), (iii) all executive officers and directors as a group and
(iv) all those known by the Company to be beneficial owners of more than five
percent of its Common Stock:
Beneficial Ownership (1)
Number of Percent of
Name of Beneficial Owner Shares Shares
Janus Capital Corporation (2) 2,613,770 11.8%
100 Fillmore Street
Denver, CO 80206
Pioneer Investment Management Corporation (3) 2,026,000 9.2%
60 State Street
Boston, MA 02109
A. Blaine Bowman (4) 1,274,388 5.6%
James F. Battey 495,980 2.2%
Barton Evans, Jr. (4) 375,755 1.7%
David L. Anderson (4) 292,032 1.3%
Brent J. Middleton (4) 46,224 *
Nebojsa Avdalovic (4) 42,950 *
B. J. Moore (4) 40,040 *
Michael A. Merion (4) 16,346 *
Riccardo Pigliucci (4) 10,000 *
All executive officers and directors as a 2,684,783 11.6%
group (11 persons) (5)
* Less than one percent.
(1) This table is based upon information supplied by officers, directors and
principal stockholders and Schedules 13D and 13G filed with the SEC. Unless
otherwise indicated in the footnotes to this table, and subject to community
property laws where applicable, the Company believes that each of the
stockholders named in this table has sole voting and investment power with
respect to the shares indicated as beneficially owned. Applicable
percentages are based on 22,059,914 shares outstanding on August 1, 2000
adjusted as required by rules promulgated by the SEC.
(2) Janus Capital Corporation is a registered investment advisor. As of
August 1, 2000, Janus Capital Corporation had shared dispositive and voting
power with respect to all of the shares set forth above.
(3) Pioneer Investment Management Corporation is a registered investment
advisor. As of August 1, 2000, Pioneer Investment Management Corporation had
sole dispositive and voting power with respect to all of the shares set forth
above.
(4) Includes shares subject to outstanding stock options that were exercisable
on August 1, 2000 or that could become exercisable within 60 days thereafter,
as follows: Mr. Bowman, 601,000 shares; Mr. Evans, 250,000 shares;
Mr. Anderson, 10,000 shares; Dr. Avdalovic, 38,300 shares; Mr. Moore, 6,000
shares; Mr. Pigliucci, 10,000 shares; Dr. Merion, 10,000 shares; and
Mr. Middleton, 43,000 shares.
(5) Includes shares described in note 4 above and 58,450 additional shares
subject to outstanding stock options held by other executive officers of the
Company that were exercisable on August 1, 2000 or could become exercisable
within 60 days thereafter.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Exchange Act requires the Company's directors and
executive officers, and persons who own more than ten percent of a registered
class of the Company's equity securities, to file with the SEC initial
reports of ownership and reports of changes in ownership of Common Stock and
other equity securities of the Company. Executive officers, directors and
greater than ten percent stockholders are required by SEC regulation to
furnish the Company with copies of all Section 16(a) forms they file.
To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company and written representations that no other
reports were required during the fiscal year ended June 30, 2000, the
Company's executive officers and directors complied with applicable
Section 16(a) filing requirements.
EXECUTIVE COMPENSATION
Compensation of Directors
Each Non-Employee Director received an annual fee of $16,500 in fiscal 2000 and
$1,250 for each regularly scheduled meeting attended, including the Audit
Committee meeting, and $800 for every other meeting attended. A Non-Employee
Director is defined as a director who is not an employee of the Company or
any parent corporation or subsidiary corporation of the Company as those
terms are defined in Sections 424(e) and (f), respectively, of the Internal
Revenue Code of 1986, as amended (the "Code") (any such corporation, an
"Affiliate"), and has not been an employee or the Company or any Affiliate for
all or part of the preceding fiscal year. The annual fee payable to Non-
Employee Directors during fiscal 2001 will remain the same as in fiscal 2000.
In addition, each Non-Employee Director is eligible for option grants under the
Company's 1988 Directors' Stock Option Plan (the "Directors' Plan"). The
Directors' Plan is administered by the Board. On the date of the annual
meeting of stockholders, each member of the Board who is a Non-Employee
Director, as defined above, is automatically granted under the Directors' Plan,
without further action by the Company, the Board or the stockholders of the
Company, an option to purchase 4,000 shares of Common Stock of the Company.
Each person who is elected for the first time to be a Non-Employee
Director is automatically granted an option to purchase 10,000 shares of the
Common Stock of the Company. The exercise price of options granted under the
Directors' Plan is 100% of the fair market value of the Common Stock subject
to the option on the date of the option grant. Options granted under the
Directors' Plan vest in 25% increments each year beginning one year from the
date of grant. The term of options granted under the Directors' Plan is five
years from the date granted.
During the last fiscal year, the Company granted options covering 16,000 shares
to the Non-Employee Directors of the Company at a weighted average exercise
price per share of $45.75. Options to purchase 12,000 shares of Common Stock
granted under the Directors' Plan were exercised during fiscal 2000, and the
value realized upon exercise of such options was $268,218.
Compensation of Executive Officers
The following table sets forth, for the fiscal years ended June 30, 2000, 1999,
and 1998, certain compensation awarded or paid to, or earned by, the Company's
Chief Executive Officer and the Company's four other most highly compensated
executive officers at June 30, 2000 (the "Named Executive Officers").
SUMMARY COMPENSATION TABLE
Long-Term
Compensation
Awards
Number of
Shares of
Common
Stock
Annual Compensation Underlying All Other
Name and Principal Position Year Salary(1) Bonus(2) Options Compensation(3)
A. Blaine Bowman 2000 $376,192 $340,759(4) 190,000 $8,500
President and 1999 354,596 400,497(4) -- 8,000
Chief Executive Officer 1998 334,904 361,489(4) 160,000 8,000
Barton Evans, Jr. 2000 $246,346 $139,440 80,000 $8,311
Senior Vice President 1999 224,539 147,369 -- 7,676
1998 209,238 127,699 40,000 7,995
Nebojsa Avdalovic 2000 $191,808 $63,496 32,000 $8,669
Vice President 1999 175,054 64,164 -- 8,485
1998 168,185 58,399 18,000 8,294
Michael A. Merion 2000 $156,447 $54,353 37,000 $8,844
Vice President 1999 132,362 53,561 -- 8,138
1998 119,135 47,121 20,000 6,117
Brent J. Middleton 2000 $175,385 $94,757 60,000 $8,692
Vice President 1999 149,515 84,749 -- 8,664
1998 137,423 77,080 30,000 9,356
(1) Includes amounts earned but deferred at the election of the Named
Executive Officers pursuant to the Company's 401(k) Plan.
(2) Amounts shown include amounts earned under the Company's Employee Profit
Sharing Plan and the Management Bonus Plan. Under the Employee Profit
Sharing Plan, amounts earned in fiscal years 2000, 1999, and 1998,
respectively, were as follows: Mr. Bowman $65,759, $80,497 and $71,489;
Mr. Evans $35,440, $39,369 and $34,669; Dr. Avdalovic $23,496, $25,164 and
$23,399; Mr. Middleton $24,757, $24,749 and $22,080; and Dr. Merion $19,353,
$19,561 and $17,121. Under the Management Bonus Plan, amounts earned in
fiscal years 2000, 1999 and 1998, respectively, were as follows:
Mr. Bowman $275,000, $320,000 and $290,000; Mr. Evans $104,000, $108,000
and $93,000; Dr. Avdalovic $40,000, $39,000 and $35,000; Mr. Middleton
$70,000, $60,000 and $55,000; and Dr. Merion $35,000, $34,000 and $30,000.
(3) Amounts shown include Company contributions to the Company's 401(k) Plan.
(4) Includes $150,000, $220,000 and $190,000 deferred at the election of Mr.
Bowman for fiscal 2000, 1999 and 1998, respectively, pursuant to the
Company's compensation deferral plan established by the Company for Mr. Bowman.
Stock Option Grants and Exercises
The Company grants options to its executive officers under the Dionex
Corporation Stock Option Plan. As of June 30, 2000, options to purchase a
total of 3,020,082 shares had been granted and were outstanding under the
Plan and the Company's now-expired 1984 Supplemental Stock Option Plan.
Options to purchase 1,398,708 shares remained available for grant under the
plan.
OPTION GRANTS IN LAST FISCAL YEAR
Individual Grants
Number of
Shares of % of Total Potential Realizable
Common Options Value at Assumed
Stock Granted to Exercise Annual Rates of Stock
Underlying Employees Price Price Appreciation
Options in Fiscal Per Expiration for Option Term (3)
Name Granted (1) Year (2) Share Date 5% 10%
Mr. Bowman 190,000 17.4% $32.00 1/19/2010 $3,823,712 $9,689,696
Mr. Evans 55,000 5.0% $32.00 1/19/2010 $1,106,864 $2,804,912
25,000 2.3% $32.25 4/11/2010 $ 507,051 $1,284,921
Dr. Avdalovic 20,000 1.8% $32.00 1/19/2010 $ 402,496 $1,019,968
12,000 1.1% $32.25 4/11/2010 $ 243,384 $ 616,762
Dr. Merion 25,000 2.3% $32.00 1/19/2010 $ 503,120 $1,274,960
12,000 1.1% $32.25 4/11/2010 $ 243,384 $ 616,762
Mr. Middleton 40,000 3.7% $32.00 1/19/2010 $ 804,992 $2,039,936
20,000 1.8% $32.25 4/11/2010 $ 405,641 $1,027,937
All stockholders as a group(4) $447 $ 1,133
million million
(1) Consists of incentive stock options to purchase 31,340 shares of Common
Stock and nonstatutory stock options to purchase 367,660 shares of Common
Stock granted under the Plan. Each of such options has a ten-year term,
subject to earlier termination upon death, disability or termination of
employment, and vests over four years from the date of the grant. The exercise
prices of such options are equal to 100% of the fair market value of the
Company's Common Stock at January 20, 2000 and April 12, 2000, respectively,
based on the closing sales price of the Common Stock as reported on the
Nasdaq National Market for the business day prior to the date of grant. The
Plan contains provisions permitting the Board to accelerate vesting of
outstanding options. In addition, in the event of a dissolution or
liquidation of the Company, a specified stockholder-approved merger or a sale
of all or substantially all of the assets of the Company, to the extent
permitted by law, vesting with respect to each outstanding option will
automatically be accelerated, unless such options are either assumed by any
successor corporation (or its parent corporation) or are otherwise replaced
with comparable options to purchase shares of the capital stock of such
successor corporation or parent thereof.
(2) Based on 1,091,200 options granted to employees in fiscal 2000.
(3) In accordance with the rules of the SEC, the table sets forth the
hypothetical gains or "option spreads" that would exist for such options at
the end of their respective terms. These gains are based on assumed rates of
annual compound stock price appreciation of 5% and 10% from the
date of grant to the end of the option term (ten years). The potential
realizable value is calculated by assuming that the stock price on the date
of grant appreciates at the indicated annual rate, compounded annually for
the entire term of the option, and that the option is exercised and sold
on the last day of its term at the appreciated stock price. For example, a
stockholder who purchased one share of stock on January 20, 2000 at $32.00,
held the stock for ten years (while the stock appreciated at 5% or 10% annual
rate, respectively) and sold it on January 19, 2010, would have profits of
$20.12 and $51.00, respectively, on his or her $32.00 investment. In
addition, a stockholder who purchased one share of stock on April 12, 2000 at
$32.25, held the stock for ten years (while the stock appreciated at 5% and 10%
annual rate, respectively) and sold it on April 11, 2010, would have profits
of $20.28 and $51.40, respectively, on his or her $32.25 investment. No gain
to the optionee is possible unless the price of the Company's stock increases
over the option term, benefiting all of the Company's stockholders. These
amounts represent certain assumed rates of appreciation in accordance with the
rules of the SEC and do not reflect the Company's estimate or projection of
future stock price performance. Actual gains, if any, are dependent on the
actual future performance of the Company's Common Stock.
(4) These amounts represent the increase in the aggregate market value of the
Common Stock outstanding as of April 12, 2000 (22,039,000 shares) assuming
the annual rates of stock price appreciation set forth above over the
ten-year period used for the Named Executive Officers. These amounts do not
reflect the Company's estimate or projection of future stock price
performance. Actual gains, if any, are dependent on the actual future
performance of the Company's Common Stock.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES
Number of
Number of Shares of Common Value of
Shares Stock Underlying Unexercised In-the-
Acquired Unexercised Options Money Options at
On Value At Fiscal Year End At Fiscal Year End
Name Exercise Realized Exercisable/Unexercis. Exercisable/Unexercis.
(1) (2) (3)
Mr. Bowman 205,000 $7,335,313 601,000/320,000 $8,507,625/$731,875
Mr. Evans - - 250,000/114,000 $3,946,875/$198,625
Dr. Avdalovic 30,000 1,030 888 38,300/45,500 $422,269/$70,594
Dr. Merion 19,600 522,775 10,000/51,000 $26,250/$68,000
Mr. Middleton 27,600 702,775 43,000/80,000 $363,312/$91,563
(1) Represents the fair market value of the underlying shares on the date of
exercise (based upon the closing sales price reported on the Nasdaq National
Market or the actual sales price if the shares were sold by the optionee)
less the exercise price.
(2) Includes both "in-the-money" and "out-of-the-money" options. An "in-the-
money" option has an exercise price below the market price of the Common
Stock on the last day of the fiscal year.
(3) Represents the fair market value of the underlying shares on the last day
of the fiscal year ($26.75 based on the closing sales price of the Common
Stock as reported on the Nasdaq National Market) less the exercise price.
COMPENSATION COMMITTEE REPORT
The Compensation Committee of the Board (the "Committee") consists of non-
employee directors and establishes compensation policy and practices for the
Company's Chief Executive Officer ("CEO") and its other executive officers.
All compensation at the Company is based upon a sustained high level of
individual performance and the Company's overall performance. The Committee
provides direction and makes recommendations on all compensation matters
relating to executive officers and other senior management employees,
including stock option grants.
Compensation Philosophy
The goal of the compensation program is to tie compensation to the attainment of
specific business and individual objectives, while providing compensation
sufficient to attract, retain, motivate and reward executive officers and
other key employees who contribute to the long-term success of the Company.
In furtherance of these goals, annual base salaries are generally set at
levels that take into account both competitive and performance factors. The
Company also relies to a significant degree on annual longer-range incentive
compensation in order to attract and motivate its executives. Incentive
compensation is variable and is closely tied to corporate performance to
encourage profitability growth and the enhancement of stockholder value.
The Company's total compensation package, composed of base salary, bonus
awards and stock option grants, is designed to be competitive with leading
separations science and high technology companies with which the Company
competes for employees.
Cash-Based Compensation
Cash-based compensation paid to executive officers in fiscal 2000 consisted of
base salary, including amounts received pursuant to the Company's Employee
Profit Sharing Plan, and an annual incentive award under the Company's
Management Bonus Plan. For fiscal 2000, in making its competitive analysis
of cash-based executive compensation, the Committee reviewed surveys provided
by Towers Perrin, Hewitt and Associates and the Western Management Group, all
nationally recognized consulting organizations specializing in executive
compensation, of compensation paid to executive officers of separations
science and high technology companies. Generally, the Committee sets annual
base salary levels and bonus amounts to provide for a total cash-based
compensation that is within the second and third quartiles of compensation
paid to executive officers of separations science and high technology
companies with which the Company competes for talented executives.
Base Salary
The Committee annually reviews and adjusts each executive officer's base
salary. To ensure retention of qualified management, the Committee generally
targets base salaries paid to executive officers at competitive levels,
based on the surveys described above. In addition, when reviewing base
salaries, the Committee considers both qualitative and quantitative factors
relating to individual and corporate performance, levels of responsibility,
prior experience and breadth of knowledge. The Committee does not base its
considerations on any single one of these factors nor does it specifically
assign relative weights to factors. In many instances, the qualitative factors
necessarily involve a subjective assessment by the Committee. Generally, in
determining salary adjustments for executive officers (other than the chief
executive officer), the Committee relies primarily on the evaluation and
recommendations of Mr. Bowman.
Employee Profit Sharing Plan
The Company's Employee Profit Sharing Plan (the "EPSP") has been established to
reward all North American full-time employees of the Company, including
executive officers, for their contributions to the Company's profitability
for any given year. The structure of the EPSP provides for the
development of a compensation pool, the size of which is based on profits for a
given year. In fiscal 2000, each eligible employee, including each of the
executive officers, received pursuant to the EPSP an amount equal to 10.37%
of such employee's eligible compensation.
Annual Incentive Award
The Management Bonus Plan (the "MBP"), an annual incentive award plan, is the
variable pay program for officers and other senior managers of the Company.
The actual bonus award earned depends on the extent to which Company and
individual performance objectives are achieved for any given year. Company
objectives consist of achieving operating, strategic and financial goals
that are considered to be critical to the Company's fundamental long-term
goal of building stockholder value. The Company does not set any specific
target levels of compensation nor does it base its bonus determinations on
achievement of all criteria. At the end of each fiscal year, the Committee
evaluates the degree to which the Company has met its goals in light of its
historical and industry-wide performance. The Committee then determines
individual awards under the MBP by evaluating each participant's contribution
to the achievement of the Company's objectives and overall individual
performance as well as by ensuring that bonus awards remain at competitive
levels.
Cash-based Compensation for Fiscal 2000
The amount of the aggregate of Mr. Bowman's base salary and EPSP award for
fiscal 2000, in addition to his annual bonus under the MBP, was in the first
quartile compared to the surveyed group of leading separations science and
high technology companies. Following a review of the above-described
surveys, the Committee set Mr. Bowman's base annual salary for fiscal 2001 at
$375,000, representing an increase of 7% over his base salary for fiscal 2000.
In setting Mr. Bowman's base salary and amount of award under the MBP, the
Committee took into account, in addition to competitive consideration, the
Committee's evaluation of Mr. Bowman's contribution to the performance of the
Company in fiscal 2000. In particular, the Committee took into consideration
the Company's financial performance, including sales growth and
profitability, as well as contributions by Mr. Bowman to achievements in
strategic planning and positioning. The Committee also considered Mr.
Bowman's leadership and experience in the separations science industry and
the scope of Mr. Bowman's responsibility. As the result of this assessment,
Mr. Bowman was awarded an annual bonus of $275,000.
Similar competitive consideration and corporate and individual performance
factors accounted for increases in base salaries and were taken into
consideration in determining awards under the MBP for other executive
officers for fiscal 2000. The percentage increase in base salaries of
executive officers ranged from 13% to 39%. The executive officers received
awards under the MBP ranging from 9% to 39% of their base salaries.
Long-Term Incentives
The Company utilizes a long-term incentive program, currently consisting of the
Dionex Corporation Stock Option Plan (the "Plan") to further align the
interests of stockholders and management by creating common incentives
related to the possession by management of substantial economic interest
in the long-term appreciation of the Company's stock. In determining the size
of an option to be granted to an executive officer, the Committee takes into
account the officer's position and level of responsibility within the
Company, the officer's existing stock and invested option holdings, the
potential reward to the officer if the stock price appreciates in the public
market, and the competitiveness of the officer's overall compensation
arrangements, including stock options. Additional long-term incentives are
provided through the Company's Employee Stock Participation Plan in which all
eligible employees, including eligible executive officers of the Company, may
purchase stock of the Company, subject to specified limits, at 85% of fair
market value.
In fiscal 2000, Mr. Bowman was granted an option to purchase 190,000 shares
and the other executive officers were granted options to purchase share in
amounts ranging from 32,000 to 80,000 shares.
In fiscal 1999, no options were granted options to executive officers.
Section 162(m) of the Code generally limits the Company's deduction, for
federal income tax purposes, to no more than $1 million of compensation paid
to certain named executive officers in a taxable year. Compensation above
$1 million may be deducted if it is "performance-based compensation." The
Compensation Committee has determined that stock options granted under the Plan
with an exercise price at least equal to the fair market value of the Company's
common stock on the date of grant shall be treated as "performance-based
compensation". In fiscal 1996, the Company's stockholders approved an
amendment to the Plan that enables any compensation recognized by a Named
Executive Officer as a result of the grant of such a stock option that
qualifies as "performance-based compensation" and thus be deductible by the
Company without regard to the $1 million limit otherwise imposed by Code
Section 162(m). The Committee believes that it is unlikely that compensation,
excluding the value of any stock options granted under the Plan, paid to any
Named Executive Officer in a taxable year which is subject to the limitation
will exceed $1 million.
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
DAVID L. ANDERSON
JAMES F. BATTEY
B. J. MOORE
RICCARDO PIGLIUCCI
PERFORMANCE MEASUREMENT COMPARISON(1)
The following chart shows total stockholder return for the Standard &
Poor's 500 Stock Index, a peer group index comprised of all public companies
using SIC Code 3826 (Laboratory Analytical Instruments) (the "Peer Group")(2)
and for the Company:
COMPARISON OF FIVE-YEAR TOTAL CUMULATIVE RETURN ON INVESTMENT(3)
THE FOLLOWING TABLE WAS REPRESENTED BY A LINE CHART IN THE PRINTED MATERIAL
1995 1996 1997 1998 1999 2000
Dionex Corporation 100.00 140.98 224.04 230.60 354.10 233.88
Industry Index 100.00 136.81 167.31 166.44 235.81 594.75
S&P 500 Index 100.00 126.00 169.73 220.92 271.19 290.85
(1) This section is not "soliciting material," is not deemed "filed" with the
SEC and is not to be incorporated by reference in any filing of the Company
under the Securities Act or the Exchange Act, whether made before or after the
date thereof and irrespective of any general incorporation language in any
such filing.
(2) Upon written request of a stockholder, the Company will provide a list of
companies comprising the Peer Group as well as the list of companies that were
included in the prior year's Peer Group but are not included in this year's
Peer Group because such companies are no longer listed under the SIC Code 3826
and companies that were not included in the prior year's Peer Group but are
included in this year's Peer Group because such companies are currently, but
were not in the prior year, listed under the SIC Code 3826.
(3)The total return on investment (change in year-end stock price plus
reinvested dividends) for the Company, the Standard & Poor's 500 Stock Index and
the Peer Group, based on June 30, 1995 = 100. In accordance with the rules of
the SEC, the returns of companies comprising the Peer Group are weighted
according to their respective stock market capitalization at the beginning of
each period for which a return is indicated.
OTHER MATTERS
The Board does not know of any other matters that may come before the meeting.
If any other matters are properly presented to the meeting, it is the
intention of the persons named in the accompanying proxy to vote, or
otherwise to act, in accordance with their best judgment on such matters.
By Order of the Board of Directors
JAMES C. GAITHER
Secretary
September 11, 2000
PROXY
Dionex Corporation
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON OCTOBER 27, 2000
The undersigned hereby appoints A. Blaine Bowman and Craig A. McCollam, and
each of them, as attorneys and proxies of the undersigned, with full power
of substitution, to vote all of the shares of stock of Dionex Corporation
which the undersigned may be entitled to vote at the Annual Meeting of
Stockholders of Dionex Corporation to be held at Dionex Corporation,
501 Mercury Drive, Sunnyvale, California 94085 on October 27, 2000
at 9:00 a.m. local time, and at any and all postponements, continuations
and adjournments thereof, with all powers that the undersigned would possess if
personally present, upon and in respect of the following matters and in
accordance with the following instructions, with discretionary authority as
to any and all other matters that may properly come before the meeting.
UNLESS A CONTRARY DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED FOR ALL
NOMINEES LISTED IN PROPOSAL 1 AND FOR PROPOSAL 2, AS MORE SPECIFICALLY
DESCRIBED IN THE PROXY STATEMENT. IF SPECIFIC INSTRUCTIONS ARE INDICATED,
THIS PROXY WILL BE VOTED IN ACCORDANCE THEREWITH.
VOTE BY TELEPHONE
It's fast, convenient, and immediate!
Call Toll-Free on a Touch-Tone Phone 1-877-PRX-VOTE
(1-877-779-8683).
Follow these four easy steps:
1. Read the accompanying Proxy Statement/Prospectus and Proxy Card.
2. Call the toll-free number
1-877-PRX-VOTE (1-877-779-8683).
3. Enter your 14-digit Voter Control Number
located on your Proxy Card above your name.
4. Follow the recorded instructions.
YOUR VOTE IS IMPORTANT!
Call 1-877-PRX-VOTE anytime!
VOTE BY INTERNET
It's fast, convenient, and your vote is immediately confirmed and posted.
Follow these four easy steps:
1. Read the accompanying Proxy Statement/Prospectus
and Proxy Card.
2. Go to the Website http://www.eproxyvote.com/dnex
3. Enter your 14-digit Voter Control Number located on your
proxy Card above your name.
4. Follow the instructions provided.
YOUR VOTE IS IMPORTANT!
Go to http://www.eproxyvote.com/dnex anytime!
DO NOT RETURN YOUR PROXY CARD IF YOU ARE VOTING BY TELEPHONE OR INTERNET
DETACH HERE
/X/ Please mark votes as in this example.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES FOR
DIRECTOR LISTED BELOW AND FOR PROPOSAL 2.
1. To elect five directors to hold office until the next
Annual Meeting of Stockholders and until their successors
are elected. Nominees:
(01) David L. Anderson, (02) James F. Battey,
(03) A. Blaine Bowman, (04) B.J. Moore and (05) Riccardo
Pigliucci.
FOR ALL NOMINEES / / / / WITHHELD FROM ALL NOMINEES
/ / --------------------------------------
To withhold authority to vote for any nominee(s), write
such nominee(s)' name(s) above.
2. To ratify the selection of Deloitte & Touche LLP as the
Company's independent auditors for its fiscal year ending
June 30, 2001.
/ /FOR / /AGAINST / /ABSTAIN
Please vote, date and promptly return this proxy in the enclosed
return envelope which is postage prepaid if mailed in the United
States.
Please sign exactly as your name appears hereon. If the stock is
registered in the names of two or more persons, each should sign.
Executors,administrators, trustees, guardians and attorneys-in-
fact should add their titles. If signer is a corporation, please
give full corporate name and have a duly authorized officer sign,
stating title. If signer is a partnership, please sign in partnership
name by authorized person.
Signature:_________ Date:_____ Signature:________ Date:_____