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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement / / Confidential, for Use
of the Commission
Only (as permitted by
Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Under Rule 14a-12
DENTSPLY International Inc.
(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules
14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction
applies:
(2) Aggregate number of securities to which transaction
applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee
is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, Schedule or Registration Statement no.:
(3) Filing Party:
(4) Date Filed:
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[DENTSPLY LOGO] DENTSPLY INTERNATIONAL
570 West College Avenue
P.O. Box 872
York, PA 17405-0872
(717) 845-7511
Fax (717) 854-2343
April 19, 2001
Dear DENTSPLY Stockholder:
You are cordially invited to attend the 2001 Annual Meeting of Stockholders
to be held on Wednesday, May 23, 2001, at 9:30 a.m., at the Company's Employee
Meeting Room in York, Pennsylvania.
The Annual Meeting will include voting on the matters described in the
accompanying Notice of Annual Meeting and Proxy Statement, a report on Company
operations and discussion.
Whether or not you plan to attend, you can ensure that your shares are
represented at the Annual Meeting by voting your proxy. You have two ways to
vote your proxy. You may vote by mail by promptly completing, signing, dating
and returning the enclosed proxy card in the envelope provided or you may vote
by internet by following the instructions on the proxy card or going to the
internet at www.computershare.com/us/proxy. Your vote is important. Please take
a moment now to vote through one of the above methods.
Sincerely,
/s/ John C. Miles II
John C. Miles II
Chairman of the Board and
Chief Executive Officer
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DENTSPLY INTERNATIONAL INC.
570 WEST COLLEGE AVENUE
YORK, PENNSYLVANIA 17405-0872
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON WEDNESDAY, MAY 23, 2001
------------------------
The Annual Meeting of Stockholders (the "Annual Meeting") of DENTSPLY
International Inc., a Delaware corporation (the "Company"), will be held on
Wednesday, May 23, 2001, at 9:30 a.m., local time, at the Company's Employee
Meeting Room, 570 West College Avenue, York, Pennsylvania, for the following
purposes:
1. To elect three Class III directors to serve for a term of three
years and until their respective successors are duly elected and qualified;
2. To ratify the appointment of PricewaterhouseCoopers LLP,
independent certified public accountants, to audit the books and accounts
of the Company for the year ending December 31, 2001; and
3. To transact such other business as may properly come before the
Annual Meeting and any and all adjournments and postponements thereof.
The Board of Directors has fixed the close of business on April 5, 2001 as
the record date for the determination of stockholders entitled to notice of and
to vote at the Annual Meeting and any adjournment or postponement thereof.
The enclosed proxy is solicited by the Board of Directors of the Company.
Reference is made to the accompanying Proxy Statement for further information
with respect to the business to be transacted at the Annual Meeting.
A complete list of the stockholders entitled to vote at the Annual Meeting
will be available during ordinary business hours for examination by any
stockholder, for any purpose germane to the Annual Meeting, for a period of at
least ten days prior to the Annual Meeting, at the Company's Employee Meeting
Room, 570 West College Avenue, York, Pennsylvania.
THE BOARD OF DIRECTORS URGES YOU TO VOTE YOUR PROXY EITHER BY MAIL OR
THROUGH THE INTERNET. YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING IN
PERSON. THE VOTING OF YOUR PROXY WILL NOT AFFECT YOUR RIGHT TO REVOKE YOUR PROXY
OR TO VOTE IN PERSON IF YOU DO ATTEND THE ANNUAL MEETING.
BY ORDER OF THE BOARD OF DIRECTORS,
BRIAN M. ADDISON
Vice President, Secretary and
General Counsel
York, Pennsylvania
April 19, 2001
YOUR VOTE IS IMPORTANT, NO MATTER HOW MANY SHARES YOU
OWNED ON THE RECORD DATE.
PLEASE INDICATE YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD, DATE AND
SIGN IT, AND RETURN IT IN THE ENVELOPE PROVIDED, WHICH IS ADDRESSED FOR YOUR
CONVENIENCE AND NEEDS NO POSTAGE IF MAILED IN THE UNITED STATES. OR, IF YOU
WISH, YOU MAY PROVIDE YOUR PROXY INSTRUCTION USING THE INTERNET BY FOLLOWING THE
INSTRUCTIONS ON THE ENCLOSED PROXY CARD. IN ORDER TO AVOID THE ADDITIONAL
EXPENSE TO THE COMPANY OF FURTHER SOLICITATION, WE ASK YOUR COOPERATION IN
VOTING YOUR PROXY PROMPTLY.
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DENTSPLY INTERNATIONAL INC.
570 WEST COLLEGE AVENUE
YORK, PENNSYLVANIA 17405-0872
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PROXY STATEMENT
------------------------
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of DENTSPLY International Inc., a Delaware
corporation ("DENTSPLY" or the "Company"), for use at the Company's 2001 Annual
Meeting of Stockholders (together with any and all adjournments and
postponements thereof, the "Annual Meeting") to be held on Wednesday, May 23,
2001, at 9:30 a.m., local time, at the Company's Employee Meeting Room, 570 West
College Avenue, York, Pennsylvania, for the purposes set forth in the
accompanying Notice of Annual Meeting of Stockholders. This Proxy Statement,
together with the foregoing Notice and the enclosed proxy card, are first being
sent to stockholders on or about April 19, 2001.
The Board of Directors has fixed the close of business on April 5, 2001 as
the record date for the determination of stockholders entitled to notice of and
to vote at the Annual Meeting. On the record date, there were 51,684,762 shares
of Common Stock of the Company, par value $.01 per share ("Common Stock"),
outstanding and entitled to vote. Each share of Common Stock is entitled to one
vote per share on each matter properly brought before the Annual Meeting. Shares
can be voted at the Annual Meeting only if the stockholder is present in person
or is represented by proxy. The presence, in person or by proxy, at the Annual
Meeting of shares of Common Stock representing at least a majority of the total
number of shares of Common Stock outstanding on the record date will constitute
a quorum for purposes of the Annual Meeting.
Whether or not you are able to attend the Annual Meeting, you are urged to
vote your proxy, either by mail or the internet, which is solicited by the
Company's Board of Directors and which will be voted as you direct. In the
absence of instructions, shares represented by properly provided proxies will be
voted as recommended by the Board of Directors.
Any proxy may be revoked at any time prior to its exercise by attending the
Annual Meeting and voting in person, by notifying the Secretary of the Company
of such revocation in writing or by delivering a duly executed proxy bearing a
later date, provided that such notice or proxy is actually received by the
Company prior to the taking of any vote at the Annual Meeting.
The cost of solicitation of proxies for use at the Annual Meeting will be
borne by the Company. Solicitations will be made primarily by mail, facsimile or
through the internet, and employees or agents of the Company may solicit proxies
personally or by telephone.
Brokers, banks and other nominee holders will be requested to obtain voting
instructions of beneficial owners of stock registered in their names. Shares
represented by a duly completed proxy submitted by a nominee holder on behalf of
beneficial owners will be counted for quorum purposes, and will be voted to the
extent instructed by the nominee holder on the proxy card or through the
internet. The rules applicable to a nominee holder may preclude it from voting
the shares that it holds on certain kinds of proposals unless it receives voting
instructions from the beneficial owners of the shares (sometimes referred to as
"broker non-votes").
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ELECTION OF DIRECTORS
The Restated Certificate of Incorporation and the By-Laws of the Company
provide that the number of directors (which is to be not less than three) is to
be determined from time to time by resolution of the Board of Directors. The
Board is currently comprised of twelve persons.
Pursuant to the Company's Restated Certificate of Incorporation, the
members of the Board of Directors are divided into three classes. Each class is
to consist, as nearly as may be possible, of one-third of the whole number of
members of the Board. The term of the Class III directors expires at the Annual
Meeting. The terms of the Class I and Class II directors will expire at the 2002
and 2003 Annual Meetings of Stockholders, respectively. At each Annual Meeting,
the directors elected to succeed those whose terms expire are of the same class
as the directors they succeed and are elected for a term to expire at the third
Annual Meeting of Stockholders after their election and until their successors
are duly elected and qualified. A director elected to fill a vacancy is elected
to the same class as the director he succeeds, and a director elected to fill a
newly created directorship holds office until the next election of the class to
which such director is elected.
Three of the four incumbent Class III directors are nominees for election
this year for a three-year term expiring at the 2004 Annual Meeting of
Stockholders. One of the four incumbent Class III directors, Dr. Arthur A.
Dugoni, will retire at the end of his current term which expires at the Annual
Meeting. In the election, the three persons who receive the highest number of
votes actually cast will be elected. The proxy named in the proxy card and on
the internet voting site intends to vote for the election of the three Class III
nominees listed below unless otherwise instructed. If a holder does not wish his
or her shares to be voted for a particular nominee, the holder must identify the
exception in the appropriate space provided on the proxy card or on the internet
site, in which event the shares will be voted for the other listed nominees. If
any nominee becomes unable to serve, the proxy may vote for another person
designated by the Board of Directors or the Board may reduce the number of
directors. The Company has no reason to believe that any nominee will be unable
to serve.
The Company's By-Laws require that stockholders seeking to nominate persons
for election to the Board, or to propose other business to be brought before an
Annual Meeting of Stockholders, comply with certain procedures. See "Stockholder
Proposals for 2002 Proxy Statement".
Set forth below is certain information with regard to each of the nominees
for election as Class III directors and each continuing Class I and Class II
director.
NOMINEES FOR ELECTION AS CLASS III DIRECTORS
NAME AND AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
------------ --------------------------------------
Michael J. Coleman........................ Mr. Coleman is the President of Cape Publications and
Age 57 publisher of FLORIDA TODAY, Melbourne, Florida, and has
been the President of the South Regional Newspaper Group
since 1991. From July 1986 to May 1991, Mr. Coleman was
the President and publisher of the ROCKFORD REGISTER
STAR. Mr. Coleman is a member of the National Newspaper
Association and the American Society of Newspaper
Editors. Mr. Coleman has served as a director of the
Company since the merger of Dentsply International Inc.
("Old Dentsply") and Gendex Corporation on July 11, 1993
("the Merger") and prior thereto served as a director of
Old Dentsply
John C. Miles II.......................... Mr. Miles assumed responsibility as Chairman of the
Age 59 Board on May 20, 1998. Prior to that he was named Chief
Executive Officer of the Company on January 1, 1996 and
Vice Chairman of the Board on January 1, 1997. Prior to
that he was President and Chief Operating Officer and a
director of the Company since the Merger. Prior to that
time he served as President and Chief Operating Officer
and a director of Old Dentsply commencing in January
1990.
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NAME AND AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
------------ --------------------------------------
W. Keith Smith............................ Mr. Smith has been retired since December 31, 1998. He
Age 66 served as Vice Chairman of Mellon Bank Corporation and
Mellon Bank N.A. from July 1987 until December 31, 1998.
He also has served as Chairman and Chief Executive
Officer of The Boston Company and Boston Safe Deposit &
Trust Company since May 1993. In addition, from August
1994 until January 1995, he served as Chief Operating
Officer of The Dreyfus Corporation, and subsequent to
January 1995 he served as Chairman of the Board of The
Dreyfus Corporation as well as Chairman of Buck
Consultants, Inc. He currently serves as a director of
Biomax Technologies Inc., PPL Corporation, Baytree
Bancorp, Inc. and Baytree National Bank and Trust
Company. Mr. Smith has served as a director of the
Company since the Merger and prior thereto served as a
director of Old Dentsply.
DIRECTORS CONTINUING AS CLASS I DIRECTORS
NAME AND AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
------------ --------------------------------------
Dr. Michael C. Alfano..................... Dr. Alfano has been the Dean and Professor of
Age 53 Periodontics and Biological Sciences at the College of
Dentistry, New York University since 1998. Beginning in
1982 until 1998 he held a number of positions with Block
Drug Company, including Senior Vice President for
Research & Technology and President of Block
Professional Dental Products Company. He served on the
Board of Directors of Block Drug Company, Inc. from 1988
to 1998. He serves as a member of or consultant to
various public health organizations, including the
Editorial Board of the American Journal of Dentistry
since 1987, and has served on the Board of Overseers for
the School of Dental Medicine at the University of
Pennsylvania since 1992. Dr. Alfano was appointed to the
Dentsply Board of Directors in February, 2001.
Burton C. Borgelt......................... Mr. Borgelt has been retired since May 1996. He was
Age 68 named Chief Executive Officer of the Company on February
8, 1995 and served in that capacity until December 31,
1995. Mr. Borgelt served as Chairman of the Board of the
Company from the Merger until May 1996 and has served as
a director of the Company since the Merger. Prior to the
Merger, Mr. Borgelt served as Chairman of the Board and
Chief Executive Officer of Old Dentsply commencing in
March 1989 and as the Chief Executive Officer and a
director of Old Dentsply commencing in February 1981.
Mr. Borgelt also serves as a director of Mellon Bank
Corporation and Mellon Bank N.A.
Douglas K. Chapman........................ Mr. Chapman has been retired since March 1993. From
Age 73 January 1978 to March 1993, he was Chairman and a
director of ACCO World Corporation, a company involved
in the manufacture and sale of office products, and from
January 1987 to December 1990, he was also the Chief
Executive Officer of ACCO World Corporation. Mr. Chapman
has served as a director of the Company since the Merger
and prior thereto served as a director of Old Dentsply.
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NAME AND AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
------------ --------------------------------------
C. Frederick Fetterolf.................... Mr. Fetterolf has been retired since August 1991. In
Age 72 February 1983, he was elected a director and President
of Alcoa, an aluminum and alumina producer; and was
appointed Chief Operating Officer of Alcoa in April
1985. He currently serves as a director of Allegheny
Teledyne Incorporated, Teledyne Technologies, Union
Carbide, Praxair Inc. and Commonwealth Industries. Mr.
Fetterolf has been a director of the Company since
December 1995.
William F. Hecht.......................... Mr. Hecht has been the President of PPL Corp., a
Age 58 diversified utility and energy services company, since
1991 and in 1993 he also became its Chairman and Chief
Executive Officer. Mr. Hecht is a member of the
Executive Committee of the Board of Directors of the
Nuclear Energy Institute, is past Chairman and a current
board member of the Utility Business Education
Coalition, and serves as a director of the National
Association of Manufacturers. Mr. Hecht is also a
Trustee of Lehigh University and serves on the Board of
Directors for Lehigh Valley Hospital and Health Network.
Mr. Hecht was appointed to the Dentsply Board of
Directors in March 2001.
DIRECTORS CONTINUING AS CLASS II DIRECTORS
NAME AND AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
------------ --------------------------------------
Cynthia P. Danaher........................ Ms. Danaher has served as a business consultant, with a
Age 42 focus on internet start-up companies since November
1999. From 1995 to 1999, Ms. Danaher served as the Vice
President and Group General Manager for the
Hewlett-Packard Medical Products Group. Ms. Danaher
began her career at Hewlett-Packard in 1984 as a Sales
Development Representative, and later served as Business
Development Manager, Health Care Policy Specialist and
Marketing Manager. Ms. Danaher became a director in June
1999.
Leslie A. Jones........................... Mr. Jones served as Chairman of the Board of the Company
Age 61 from May 1996 to May 1998. From January 1991 to January
1992, he was a Senior Vice President and Special
Assistant to the President of Old Dentsply. Prior to
that time, Mr. Jones served as Old Dentsply's Senior
Vice President of North American Operations. Mr. Jones
has served as a director of the Company since the Merger
and prior thereto served as a director of Old Dentsply.
Edgar H. Schollmaier...................... Mr. Schollmaier is non-executive Chairman of Alcon
Age 67 Laboratories of Fort Worth, Texas, a wholly owned
subsidiary of Nestle S.A. He held the position of
President of Alcon from 1972 to 1997 and was Chief
Executive for the last twenty years of that term. He
also serves as a director of Stevens International, Inc.
and Incara Pharmaceuticals Corporation. Mr. Schollmaier
has served as a director of the Company since June 1996.
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VOTES REQUIRED
The Class III directors will be elected by a plurality of the votes of
shares present and entitled to vote. Accordingly, the three nominees for
election as directors who receive the highest number of votes actually cast will
be elected. Broker non-votes will be treated as shares that neither are capable
of being voted nor have been voted and, accordingly, will have no effect on the
outcome of the election of directors.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE NOMINEES FOR
ELECTION AS CLASS III DIRECTORS.
BOARD OF DIRECTORS AND COMMITTEES
The Company's Board of Directors held eight meetings during 2000, three of
which were telephone meetings. The Board has an Executive Committee, an Audit
and Information Technology Committee, a Board Governance Committee and a Human
Resources Committee, which has a Stock Option Subcommittee. The current
composition and activities of the Committees are described below.
The Executive Committee provides guidance to the executive officers of the
Company between meetings of the Board. The members of the Executive Committee
are Messrs. Miles (Chairman), Borgelt, Chapman and Jones. The Executive
Committee did not meet during 2000.
The Audit and Information Technology Committee (the "Audit Committee") is
responsible for nominating the Company's independent auditors for approval by
the Board; reviewing the scope, results and costs of the audit with the
Company's independent auditors; reviewing the financial statements of the
Company and the audit function to ensure compliance with requirements of
regulatory agencies and appropriate disclosure of necessary information to the
stockholders of the Company and reviewing and evaluating the information
technology activities of the Company. For further information on Audit Committee
activity, please refer to the section of this proxy entitled "Audit Committee
Disclosure". The members of the Audit Committee are Messrs. Schollmaier
(Chairman), Chapman and Jones and Ms. Danaher. The Audit and Information
Technology Committee held five meetings during 2000.
The Board Governance Committee is responsible for identifying and
recommending individuals to serve on the Board, reviewing and recommending Board
policies and appraising the performance of the Board. The members of this
Committee are Messrs. Jones (Chairman), Miles and Smith and, during the year
2000, Dr. Dugoni. The Board Governance Committee held one meeting during 2000.
The Human Resources Committee is responsible for evaluating and
administering compensation levels for all officers of the Company. Its current
members are Messrs. Coleman (Chairman), Borgelt, Fetterolf and Smith. Dr. Dugoni
served on the committee until May 2000. The Human Resources Committee met two
times during 2000. The Stock Option Subcommittee was created in 1998 and is
responsible for administering the Company's 1998 Stock Option Plan. Its current
members are Messrs. Coleman (Chairman), Fetterolf and Smith. Dr. Dugoni served
on the committee until May 2000.
No director, except Mr. Coleman and Ms. Danaher, attended fewer than 75% of
the total number of meetings of the Board and the meetings of any committee of
the Board on which a director served during the year ended December 31, 2000.
RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS
The Audit Committee recommended and the Board of Directors appointed
PricewaterhouseCoopers LLP ("PwC"), independent certified public accountants, as
auditors to audit the financial statements of the Company for the year ending
December 31, 2001.
The Company engaged PwC effective as of February 9, 2000 and chose not to
renew the engagement of KPMG LLP who had served as auditors for the year ended
December 31, 1999. The Audit Committee of the Board participated in and
recommended the decision to change independent accountants which was approved by
the Board of Directors.
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The audit reports of KPMG LLP on the consolidated financial statements of
DENTSPLY International Inc. for the fiscal years ended December 31, 1999 and
December 31, 1998 did not contain any adverse opinion or disclaimer of opinion
and were not qualified or modified as to uncertainty, audit scope, or accounting
principles.
In connection with its audits for the fiscal years ended December 31, 1999
and December 31, 1998, except as described below, there were no disagreements
with KPMG LLP on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure, which disagreement, if not
resolved to the satisfaction of KPMG LLP, would have caused it to make reference
to the subject matter of the disagreement in connection with its report. There
was a disagreement involving the Company's reporting of sales, cost of sales,
receivables and inventories for the third quarter of 1998. This disagreement was
discussed with the Audit Committee of the Company's Board of Directors and the
Company has authorized KPMG LLP to respond fully to the inquiries of PwC
concerning the subject matter of the disagreement.
In 1998, management of the Company believed it had certain exposures
relating to receivables from dealers located in Asia and the Commonwealth of
Independent States (CIS) caused by the economic crisis in those geographic
areas. Accordingly, management recorded a $4,450,000 reduction in third quarter
sales and a $1,980,000 reduction in cost of sales to reflect the fact that the
dealers might not be able to sell all of their inventories due to the depressed
economic environment and that higher than usual levels of product returns would
be received. Management believed that the anticipated returns should be
reflected as a reduction in sales and cost of goods sold with a reduction in
operating income of $2,470,000.
KPMG LLP disagreed with the Company's management on this matter. KPMG LLP
recommended to management that the reductions in sales and cost of sales be
reversed and that they reasonably estimate any additional bad debt provisions
that may be necessary for the Asian and CIS receivables. Management agreed to
reverse its recorded entries related to sales and cost of sales and record an
additional bad debt provision for $2,470,000 related to receivables due from the
dealers in Asia and the CIS.
In the event the appointment of PwC for 2001 is ratified, it is expected
that PwC will also audit the books and accounts of certain subsidiaries of the
Company at the close of their current fiscal years. A representative of PwC will
be present at the Annual Meeting and will have the opportunity to make a
statement, if such person desires to do so, and to respond to appropriate
questions. No representative of KPMG LLP is expected to be present at the Annual
Meeting.
The proposal to ratify the appointment of PwC will be approved by the
stockholders if it receives the affirmative vote of a majority of the shares
present in person or represented by proxy at the meeting and entitled to vote on
the proposal. If there is an abstention noted on the proxy materials on this
proposal, the abstention will have the effect of a vote against the proposal
even though the shares represented thereby will not be counted as having been
voted for or against the proposal. Broker non-votes will be treated as shares
not capable of being voted on the proposal and, accordingly, will have no effect
on the outcome of voting on the proposal.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR RATIFICATION OF
THE SELECTION OF PWC AS INDEPENDENT ACCOUNTANTS.
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EXECUTIVE COMPENSATION
SUMMARY COMPENSATION
The following table sets forth the compensation earned by the Company's
chief executive officer and the four other highest-paid executive officers of
the Company whose salary and bonus for the year ended December 31, 2000 were in
excess of $100,000 (collectively, the "named executive officers") for each of
the last three fiscal years.
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG-TERM COMPENSATION
--------------------------------------- -------------------------------
AWARDS PAYOUTS
--------------------- -------
RESTRICTED
OTHER ANNUAL STOCK OPTIONS/ LTIP ALL OTHER
NAME AND SALARY BONUS COMPENSATION AWARD(S) SARS PAYOUTS COMPENSATION
PRINCIPAL POSITION YEAR ($) ($) ($) ($) (#) ($) ($)
------------------ ---- ------- ------- ------------ ---------- -------- ------- ------------
John C. Miles II 2000 564,300 514,400 -- -- 143,700 -- 99,762(1)
Chairman of the Board 1999 550,000 302,400 -- -- 142,500 -- 91,789(1)
and Chief Executive 1998 550,000 282,800 -- -- 94,700 -- 3,021(1)
Officer(2)
Gerald K. Kunkle 2000 357,400 260,700 -- -- 93,400 -- 103,278(1)
President and Chief 1999 348,400 153,300 -- -- 64,100 -- 43,218(1)
Operating Officer 1998 335,000 172,300 -- -- 56,000 -- 3,021(1)
Thomas L. Whiting 2000 254,500 189,600 -- -- 33,700 -- 66,275(1)
Senior Vice President 1999 224,500 133,200 -- -- 37,100 -- 27,606(1)
1998 217,000 113,300 -- -- 27,500 -- 3,021(1)
W. William Weston 2000 245,383 128,802 -- -- 33,700 -- 104,162(4)
Senior Vice
President(3) 1999 220,719 86,748 -- -- 37,100 -- 56,850(4)
1998 257,699 118,002 -- -- 27,500 -- 29,157(4)
William R. Jellison 2000 230,000 153,700 -- -- 33,700 -- 47,655(1)
Senior Vice President 1999 210,000 84,700 -- -- 56,000 -- 20,850(1)
and Chief Financial 1998 147,288 69,400 -- -- 16,500 -- 2,822(1)
Officer
(1) Includes amounts contributed to The DENTSPLY International Inc. Employee
Stock Ownership Plan (the "Company ESOP") and, in 2000 and 1999, to the
Company's Supplemental Executive Retirement Plan ("SERP"). Under the
Internal Revenue Code of 1986, as amended (the "Internal Revenue Code"), the
maximum amount that can be contributed annually to the Company ESOP in
respect of any employee is generally an amount equal to the lesser of
$30,000 or 25% of such employee's covered compensation. Employee interests
in the Company ESOP and SERP are subject to vesting in accordance with the
respective plans.
(2) In May 1998, Mr. Miles assumed responsibility as Chairman of the Board.
(3) Includes compensation for overseas assignment. Mr. Weston's compensation is
paid in German marks. The exchange rates used to determine the U.S. dollar
equivalents for 2000, 1999 and 1998 were .4803, .5133 and .5993,
respectively.
(4) Includes amount contributed to the Company's SERP in 2000 and 1999. Also
includes compensation of $13,544, $14,783 and $17,260 for the tax effect of
the company car which is treated as a benefit in kind, and contributions to
the Company's German pension plan of $31,566, $16,764 and $11,897 in 2000,
1999 and 1998, respectively. The German pension plan is self-funded and
becomes vested after ten years of service. Payment in the form of a pension
commences at age 65 and is .65% times the number of years' service times the
average of the last twelve months base salary.
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The following table sets forth certain information with respect to grants
of options during the year ended December 31, 2000 and their potential
realizable values.
OPTION GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
- ------------------------------------------------------------------------------------------------
% OF TOTAL
OPTIONS
GRANTED TO EXERCISE GRANT DATE
OPTIONS EMPLOYEES IN PRICE EXPIRATION PRESENT
NAME GRANTED (#) FISCAL YEAR ($/SHARE) DATE VALUE ($)
---- ----------- ------------ --------- ---------- ------------
John C. Miles II........................... 143,700 15.65 37.438 12/13/2010 1,977,930(1)
Gerald K. Kunkle........................... 93,400 10.17 37.438 12/13/2010 1,285,586(1)
Thomas L. Whiting.......................... 33,700 3.67 37.438 12/13/2010 463,857(1)
W. William Weston.......................... 33,700 3.67 37.438 12/13/2010 463,857(1)
William R. Jellison........................ 33,700 3.67 37.438 12/13/2010 463,857(1)
The following table sets forth certain information with respect to the
exercise of options during the year ended December 31, 2000 and the value of
options held at that date.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
NUMBER OF VALUE OF UNEXERCISED
UNEXERCISED OPTIONS HELD IN-THE-MONEY OPTIONS AT
AT FISCAL YEAR-END FISCAL YEAR-END ($)(2)
SHARES ACQUIRED VALUE --------------------------- ---------------------------
NAME ON EXERCISE (#) REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- --------------- ------------ ----------- ------------- ----------- -------------
John C. Miles II......... -- -- 349,833 270,267 5,326,974 2,234,029
Gerald K. Kunkle......... -- -- 122,100 154,800 1,756,701 1,116,815
Thomas L. Whiting........ -- -- 101,900 67,600 1,609,063 588,820
W. William Weston........ -- -- 102,900 67,600 1,645,688 588,820
William R. Jellison...... -- -- 29,667 76,533 363,964 646,576
(1) Determined using the Black-Scholes option-pricing model with the following
assumptions: expected dividend yield 0.73%, risk-free interest rate 5.26%,
expected volatility 32%, and expected life 5.5 years.
(2) Represents the difference between the last reported sale price of the Common
Stock as reported on the Nasdaq National Market on December 31, 2000
($39.125) and the exercise price of the options, multiplied by the number of
shares of Common Stock issuable upon exercise of the options.
EMPLOYMENT AGREEMENTS
The Company is party to employment agreements with all of the named
executive officers. Each of these employment agreements provides that, upon
termination of such individual's employment with the Company as a result of the
employee's death, the Company is obligated to pay the employee's estate the then
current base compensation of the employee for a period of one year following the
date of the employee's death, together with the employee's pro rata share of any
incentive or bonus payments due for the period prior to the employee's death.
Each of the employment agreements also provides that, in the event that the
employee's employment is terminated by the Company (in certain cases without
"cause," as defined in the employment agreements) or by the employee with "good
reason" (as described in the employment agreements), (i) the Company will be
obligated to pay the employee for a period of two years subsequent to
termination of employment at the rate paid to the employee during the prior 12
month period, and (ii) the employee will be entitled to receive the benefits
that would have been accrued by him during the two year period following
termination of employment under employee benefit plans, programs or other
arrangements of the Company or any of its affiliates in which the employee
participated before the termination of his employment. In the event that such
termination of employment is made by the Company without cause or by the
employee with good reason after a "change in
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control" (as defined in the employment agreements), the employee may require the
Company to pay to the employee, within five days after the employee's request
for such payment, the present value of the amounts that would have been payable
to him under the employment agreement during the two year period following such
termination of employment.
The Company has also entered into employment agreements with certain other
members of senior management having terms substantially similar to those
described above.
COMPENSATION OF DIRECTORS
Members of the Board of Directors who are not employees of the Company
("Outside Directors") receive an annual fee of $22,000 ($26,000 for Outside
Directors who are chairpersons of any committee of the Board) and an additional
fee of $1,000 for each Board and committee meeting attended. In 1993, each
Outside Director at that time received a non-discretionary grant of options to
purchase 6,000 shares (after a split of the shares of Common Stock) of Common
Stock under the 1993 Stock Option Plan. Additionally, any Outside Director
elected since 1993 received a non-discretionary grant of options at the time of
their election to purchase 6,000 shares of Common Stock. Each Outside Director
will automatically receive an additional grant of 6,000 options on every third
anniversary of the date of the initial grant of options to such Outside
Director. Directors are reimbursed for travel and other expenses relating to
attendance at Board and Committee meetings.
Effective January 1, 1997, the Company established a new Directors'
Deferred Compensation Plan (the "Deferred Plan"), which replaced the plan that
was enacted during 1994. The Deferred Plan permits Outside Directors to elect to
defer receipt of directors fees or other compensation for their services as
directors. Outside Directors can elect to have their deferred payments
administered as a cash with interest account or a stock unit account. Payment
under the Deferred Plan will not be made to any Outside Director until the
Outside Director ceases to be a Board member.
HUMAN RESOURCES COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
From December 18, 1997 to May 24, 2000, Mr. Borgelt, Mr. Coleman, Dr.
Dugoni and Mr. Fetterolf were members of the Human Resources Committee. On May
24, 2000, Mr. Smith joined and Dr. Dugoni left the Human Resource Committee.
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information regarding the beneficial
ownership of the Company's Common Stock as of February 28, 2001 held by (i) each
person who is known by the Company to have been the beneficial owner of more
than five percent of the Company's Common Stock on such date, (ii) each director
and nominee for director, (iii) the Company's chief executive officer and the
other named executive officers, and (iv) all directors and executive officers of
the Company as a group (based on 51,669,929 shares of Common Stock outstanding
as of such date).
SHARES OWNED
BENEFICIALLY
DIRECTORS, EXECUTIVE OFFICERS ----------------------
AND FIVE PERCENT STOCKHOLDERS NUMBER PERCENT
----------------------------- --------- -------
The DENTSPLY International Inc.
Employee Stock Ownership Plan Trust
c/o T. Rowe Price
P. O. Box 17349
Baltimore, MD 21297-1349.................................. 5,912,671(1) 11.4
Burton C. Borgelt........................................... 736,701(2) 1.4
John C. Miles II............................................ 553,731(3) 1.1
Gerald K. Kunkle............................................ 139,738(4) *
Thomas L. Whiting........................................... 152,072(5) *
W. William Weston........................................... 145,790(6) *
William R. Jellison......................................... 36,377(7) *
Dr. Michael C. Alfano....................................... -- *
Douglas K. Chapman.......................................... 23,986(8) *
Michael J. Coleman.......................................... 20,200(9) *
Cynthia P. Danaher.......................................... 2,000(10) *
Arthur A. Dugoni, D.D.S., M.S.D............................. 14,000(11) *
C. Frederick Fetterolf...................................... 13,000(12) *
William F. Hecht............................................ -- *
Leslie A. Jones............................................. 95,686(11) *
Edgar H. Schollmaier........................................ 18,000(13) *
W. Keith Smith.............................................. 26,570(11) *
All directors and executive officers as a group (18
persons).................................................. 2,083,561(14) 4.0
- ---------------
* Less than 1%
(1) Participants in the Company ESOP have the right to direct the trustee
of the Company ESOP as to the voting of shares allocated to such
participants' accounts on all matters submitted to a vote of the
stockholders of the Company, including the election of directors.
Unallocated shares and shares as to which no directions are received
by the trustee of the Company ESOP are voted as directed by the
Company ESOP Committee, which consists of certain employees of the
Company. As of February 28, 2001, 5,209,737 of the shares held by the
trust holding the assets of the Company ESOP were allocated to
participant accounts and 702,934 shares remained unallocated. Each
Company ESOP participant who is fully vested is entitled to receive a
distribution of all of the shares of common stock allocated to his or
her account as soon as practicable after such participant's employment
with the Company terminates. In general, except for certain
participants who are age 55 or older and have been participants in the
Company ESOP for at least 10 years, participants are not entitled to
sell shares allocated to their accounts until their employment has
terminated and the shares allocated to such participants' accounts are
distributed to them.
(2) Includes 64,542 shares owned by a trust of which Mr. Borgelt is a
co-trustee with shared investment and voting power, 21,366 shares held
by Mr. Borgelt's grandchildren, 112,633 shares held in Mr. Borgelt's
individual retirement account and 112,000 shares which could be
acquired pursuant to the exercise of options exercisable within 60
days of February 28, 2001.
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(3) Includes 49,074 shares allocated to the Company ESOP account of Mr.
Miles, 11,794 shares held in Mr. Miles' individual retirement account,
and 349,833 shares which could be acquired pursuant to the exercise of
options exercisable within 60 days of February 28, 2001.
(4) Includes 2,638 shares allocated to the Company ESOP account of Mr.
Kunkle, 5,000 shares held in Mr. Kunkle's' individual retirement
account and 122,100 shares which could be acquired pursuant to the
exercise of options exercisable within 60 days of February 28, 2001.
(5) Includes 29,248 shares allocated to the Company ESOP account of Mr.
Whiting and 101,900 shares which could be acquired pursuant to
exercise of options exercisable within 60 days of February 28, 2001.
(6) Consists of 42,890 shares held by Mr. Weston's spouse and 102,900
shares which could be acquired pursuant to exercise of options
exercisable within 60 days of February 28, 2001.
(7) Includes 1,000 shares owned by a trust of which Mr. Jellison is a
co-trustee with shared investment and voting power, 1,710 shares
allocated to the Company ESOP account of Mr. Jellison and 29,667
shares which could be acquired pursuant to the exercise of options
exercisable within 60 days of February 28, 2001.
(8) Includes 9,986 shares owned by a trust of which Mr. Chapman is a
co-trustee with shared investment and voting power and 14,000 shares
which could be acquired pursuant to exercise of options exercisable
within 60 days of February 28, 2001.
(9) Includes 4,200 shares held by Mr. Coleman's spouse and 14,000 shares
which could be acquired pursuant to exercise of options exercisable
within 60 days of February 28, 2001.
(10) Includes 2,000 shares which could be acquired pursuant to the exercise
of options exercisable within 60 days of February 28, 2001.
(11) Includes 14,000 shares which could be acquired pursuant to exercise of
options exercisable within 60 days of February 28, 2001.
(12) Includes 10,000 shares which could be acquired pursuant to exercise of
stock options exercisable within 60 days of February 28, 2001.
(13) Includes 8,000 shares which could be acquired pursuant to the exercise
of options exercisable within 60 days of February 28, 2001.
(14) Includes 143,984 shares held by or for the benefit of others, 129,427
shares held in individual retirement accounts, 527 shares held in a
401(k) account, 90,318 shares allocated to employees' ESOP accounts
and 1,004,935 shares which could be acquired pursuant to the exercise
of warrants and options exercisable within 60 days of February 28,
2001.
The Board of Directors has established stock ownership guidelines to
encourage accumulation and retention of Common Stock by executives of the
Company, including the named executive officers. The guidelines are stated as a
multiple of annual base salary as follows: three times annual base salary for
the chief executive officer; two times annual base salary for the chief
operating officer; one times annual base salary for senior vice presidents; .75
times base salary for vice presidents and other officers; and .50 times base
salary for general managers. The recommended time period for reaching the
guidelines is five years. Common Stock allocated to officers in their Company
ESOP account and individual retirement plans will be included but stock options
will not be counted in determining ownership levels.
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HUMAN RESOURCES COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Human Resources Committee is pleased to present its report on executive
compensation. This report describes the components of the Company's executive
officer compensation programs and the basis on which compensation determinations
are made with respect to the executive officers of the Company.
In November 1999, the Committee retained Towers Perrin to study and report
on the Company's executive compensation practices and to do competitive
evaluations of the total compensation for twelve of the Company's corporate
officer and executive positions. The Human Resources Committee reviewed the
findings of these studies and made its recommendations to the Board of Directors
of the Company at meetings held in December 1999.
COMPENSATION PHILOSOPHY
It is the philosophy of the Company that a significant portion of executive
compensation be directly linked to the Company's success in meeting profit,
growth and corporate performance goals, as well as increases in stockholder
value. The Human Resources Committee utilizes the following objectives as
guidelines for compensation decisions:
-- Provide a competitive total compensation package that enables the
Company to attract and retain key personnel.
-- Provide a broad-based compensation package that recognizes the
contributions of all management personnel.
-- Provide variable compensation opportunities, primarily on an annual
basis, that are directly linked to corporate performance goals.
-- Provide long-term compensation opportunities, through stock options,
that align executive compensation with value received by stockholders.
Section 162(m) of the Internal Revenue Code disallows a Federal income tax
deduction to publicly held companies for compensation paid to the chief
executive officer and the other named executive officers, to the extent that
compensation exceeds $1 million for such officer in any fiscal year. This
limitation does not apply to compensation that is "performance based" in
accordance with certain specific requirements. The Company's 1998 stock option
plan has been structured so that options granted under the plan qualify as
"performance based compensation" and are exempt from the limitations on
deduction. Compensation paid to the Company's chief executive officer for 2000
that was not "performance-based compensation" in accordance with Section 162(m)
exceeded the $1 million limit. The Committee believes that the chief executive
officer and the other named executive officers are being appropriately
compensated in a manner that relates to performance and is in the long-term
interests of the stockholders. The Committee is not taking action at this time
to limit the Company's discretion to pay "non-performance based compensation" to
the chief executive officer and the other named executive officers.
COMPENSATION PROGRAM COMPONENTS
The Human Resources Committee periodically reviews the Company's
compensation programs to ensure that pay levels and incentive opportunities are
competitive and reflect the performance of the Company. The compensation program
for executive officers is comprised of the following components: base salary,
annual incentive compensation and stock options. Each of these components is
summarized below.
Base Salary. In December 1999, the Committee reviewed and approved the base
salaries of John C. Miles II, Gerald K. Kunkle, Thomas L. Whiting, W. William
Weston and William R. Jellison, in light of the information supplied by Towers
Perrin in November, 1999 concerning industry practices and the recommendations
made by them with respect to the Company's compensation policies. Based on the
above information, effective in 2000, the Committee set Mr. Miles' and Mr.
Kunkle's base salaries at $564,300 and $357,400, respectively. The base salaries
of Messrs. Whiting, Weston and Jellison were set by the Committee at $254,500,
$240,700 and $230,000,
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respectively; however, Mr. Weston is paid in German Marks and his actual salary
is affected by the dollar-mark exchange ratio.
Among the factors that the Human Resources Committee considered in setting
base salaries for executive officers were its interpretation of the Towers
Perrin report regarding salary levels of executive officers of other
manufacturing companies of similar size, and a subjective evaluation of the
Company's performance. While the Committee believes that it will be appropriate
to attempt to maintain base salaries in line with perceived industry averages
for comparable companies, the amount of any particular salary increase will also
depend upon the individual's job performance. In addition to the Towers Perrin
report, the chief executive officer's recommendations were taken into account in
setting the base salaries of executive officers other than the chief executive
officer.
Annual Incentive Compensation. Annual bonuses represent payments for the
achievement of short-term objectives and recognize both the overall performance
of the Company and individual performance in a given year. In December 1999, the
Human Resources Committee approved a bonus program for senior executives in
2000.
Under this bonus program, during 2000, certain target award opportunities
were established for the Company's chief executive officer ("CEO"), president
and chief operating officer ("COO"), senior vice presidents and other management
employees. For the CEO, COO and the chief financial officer ("CFO"), the target
consisted of: (i) the budgeted level of corporate net income; and (ii) the
budgeted level of corporate sales. For the senior vice presidents other than the
CFO, the targets consisted of: (i) the budgeted level of corporate net income;
(ii) the budgeted operating income level of the business group applicable to
each such senior vice president; and (iii) the budgeted level of corporate
sales. For Mr. Miles and Mr. Kunkle, the bonus award for 100% of targeted
performance was set at 75% and 60%, respectively, of their base salaries, while
for Messrs. Whiting, Weston and Jellison, the bonus awards for 100% of targeted
performance were set at 55% of their respective base salaries. Messrs. Miles,
Kunkle, Whiting, Weston and Jellison received bonus awards for 2000 of 91.2%,
72.9%, 74.5%, 52.5%, and 66.8%, respectively, of their base salaries.
The named executive officers also participate in the DENTSPLY International
Inc. Supplemental Executive Retirement Plan ("SERP"). The SERP is an unfunded
"top-hat" plan for the purposes of providing additional retirement benefits for
highly compensated employees of the Company to make the Company's executive
retirement benefits more competitive and to make up for contributions that would
otherwise have been made for such executives under the terms of the Company's
ESOP plan if it were not for the limitations imposed by the Internal Revenue
Code.
HUMAN RESOURCES COMMITTEE
MICHAEL J. COLEMAN BURTON C. BORGELT C. FREDERICK FETTEROLF
W. KEITH SMITH
STOCK OPTIONS
The Company's 1998 stock option plan is intended to motivate key employees
to put forth maximum efforts toward the continued growth, profitability and
success of the Company by providing incentives through the ownership and
performance of the Company's Common Stock. The plan is designed to provide
benefits to key management only to the extent that stockholders enjoy increases
in value.
In 2000, 383,400 stock options were granted to the Company's executive
officers under the 1998 stock option plan. The Stock Option Subcommittee of the
Human Resources Committee considered the respective stock and option holdings of
the executive officers of the Company in comparison with stock and option
holdings of top executives of companies of similar size and growth records,
based in large part upon the recommendations set forth in the Towers Perrin
report, and made option awards during 2000 that were intended to keep its
executive officers' holdings competitive with industry averages for comparable
companies.
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In determining the number of stock options to be granted to Mr. Miles in
2000, the subcommittee compared Mr. Miles' base salary, bonus and past stock
option grants to the compensation practices of corporations with revenues of
$500 million to $1 billion in Towers Perrin's Executive Compensation Data Base.
The grant made to Mr. Miles placed a greater emphasis on the long term portion
of his total direct compensation (base salary, annual bonus and the Black
Scholes value of DENTSPLY option grants) while still positioning his total
direct compensation between the 50th and 75th percentiles of competitive
practice.
STOCK OPTION SUBCOMMITTEE
MICHAEL J. COLEMAN C. FREDERICK FETTEROLF W. KEITH SMITH
AUDIT COMMITTEE DISCLOSURE
AUDIT COMMITTEE REPORT
The Audit Committee consists of four directors, all of whom are independent
as defined by Nasdaq's independent director and audit committee listing
standards. The Audit Committee operates under a written charter adopted by the
Board of Directors. This charter is reviewed annually by the Committee and the
board and amended as determined appropriate. A copy of this charter is included
in Appendix A.
The Audit Committee reviews the Company's financial reporting process on
behalf of the Board. In addition, the Committee recommends to the Board, subject
to stockholder ratification, the selection of the Company's independent public
accountants.
Management is responsible for the Company's internal controls and the
financial reporting process. The independent public accountants are responsible
for performing an independent audit of the Company's financial statements in
accordance with generally accepted auditing standards and to issue a report
thereon. The Committee's responsibility is to oversee these processes.
In this context, the Committee has met and held discussions with management
and PricewaterhouseCoopers LLP (PwC), the Company's independent public
accountants. Management represented to the Committee that the Company's
financial statements were prepared in accordance with generally accepted
accounting principles, and the Committee has reviewed and discussed the audited
financial statements with management and PwC. The Committee discussed with PwC
the matters required to be discussed by Statement on Auditing Standards No. 61
(Communication with Audit Committees).
In addition, the Committee has discussed with PwC the auditor's
independence from the Company and its management and has received the written
disclosures and the letter from PwC required by Independence Standards Board
Standard No. 1 (Independence Discussions with Audit Committees), as it has been
modified or supplemented.
The Committee discussed with PwC the overall scope and plans for their
audits. The Committee meets with PwC, with and without management present, to
discuss the results of their examinations, the evaluations of the Company's
internal controls, and the overall quality of the Company's financial reporting.
Based upon the Committee's discussions with management and PwC and the
Committee's review of the representations of management and the report of PwC to
the Committee, the Committee recommended that the Board include the audited
financial statements in the Company's Annual Report on Form 10-K for the year
ended December 31, 2000 filed with the Securities and Exchange Commission.
AUDIT AND INFORMATION TECHNOLOGY COMMITTEE
DOUGLAS K. CHAPMAN CYNTHIA P. DANAHER LESLIE A. JONES EDGAR H. SCHOLLMAIER
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FEES PAID TO AUDITORS
The following table sets forth the fees the Company incurred for services
performed by PwC for the year ended December 31, 2000.
Audit fees.................................................. $ 627,000
Financial information system design and implementation
fees...................................................... --
All other fees.............................................. 465,000(1)
----------
$1,092,000
==========
- ---------------
(1) Includes fees for tax consulting of $444,000 and fees for other non-audit
services of $21,000.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
The following graph shows the cumulative total stockholder return on the
Company's Common Stock over the last five fiscal years as compared to the
returns of the Nasdaq Total Return Index and the Standard & Poor's Health Care
Composite Index. The graph assumes that $100 was invested on December 31, 1995
in the Company's Common Stock and in the Nasdaq Total Return Index and the
Standard & Poor's Health Care Composite Index and assumes reinvestment of
dividends.
YEAR ENDED
DECEMBER 31, 1995 1996 1997 1998 1999 2000
------------ ---- ----- ----- ----- ----- -----
DENTSPLY International Inc.......................... 100 119.7 154.8 131.8 122.0 203.7
S&P Health Care Composite Index..................... 100 120.8 173.5 250.3 229.7 312.2
Nasdaq Total Return Index........................... 100 123.0 150.7 212.5 394.9 237.6
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SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under federal securities laws, the Company's directors, certain officers,
and persons holding more than 10% of the Common Stock of the Company are
required to report, within specified monthly and annual due dates, their initial
ownership and any subsequent changes in ownership to the Securities and Exchange
Commission. The Company is required to describe in this proxy statement whether
it has knowledge that any person required to file such report may have failed to
do so in a timely manner. Based upon reports furnished to the Company and
written representations and information provided to the Company by the persons,
the Company believes that during fiscal 2000, all such persons complied with all
applicable filing requirements, except that the Company determined that the
phantom stock granted to directors pursuant to the Directors Deferred
Compensation Plan described in this proxy statement had not been included in
their year-end reports. As a result, the following directors have filed amended
year-end reports with respect to the exempt grant of phantom stock in each of
the years from 1997 through 2000: Douglas K. Chapman, Michael J. Coleman, C.
Frederick Fetterolf, Edgar H. Schollmaier and W. Keith Smith. Burton C. Borgelt
and Cynthia P. Danaher have filed amended year-end reports with respect to the
exempt grant of phantom stock in 1999 and 2000.
STOCKHOLDER PROPOSALS FOR 2002 PROXY STATEMENT
Stockholder proposals that are intended to be presented at the Company's
Annual Meeting of Stockholders to be held in 2002 must be received by the
Company no later than December 20, 2001, and must otherwise comply with Rule
14a-8, in order to be included in the proxy statement and proxy relating to that
meeting.
The Company's By-Laws provide that advance notice of stockholder-proposed
business to be brought before an Annual Meeting of Stockholders must be given to
the secretary of the Company not less than 60 days in advance of the date of the
mailing of materials regarding the prior year's Annual Meeting, which mailing
date is identified on the Chairman's letter at the front of this proxy
statement. To propose business for an Annual Meeting, a stockholder must specify
in writing the business desired to be brought before the Annual Meeting and the
reasons for conducting such business at the Annual Meeting, the proposing
stockholder's name and address, the class and number of shares beneficially
owned by the stockholder, and any material interest of the stockholder in such
business. In order to be brought before the 2002 Annual Meeting, stockholders
must notify the Company in writing, in accordance with the procedures set forth
above, of any stockholder-proposed business no later than February 17, 2002.
The Company's By-Laws also provide that a stockholder may request that
persons be nominated for election as directors by submitting such request,
together with the written consent of the persons proposed to be nominated, to
the secretary of the Company not less than 60 days prior to the date of the
Annual Meeting. To be in proper form, the nominating stockholder must set forth
in writing, as to each proposed nominee, the nominee's age, business address,
residence address, principal occupation or employment, number of shares of
Common Stock of the Company beneficially owned by such person and such other
information related to such person as is required to be disclosed by applicable
law, and, as to the stockholder submitting the request, such stockholder's name
and address as they appear on the Company's books and the number of shares of
Common Stock of the Company owned beneficially by such person.
FORM 10-K
STOCKHOLDERS MAY OBTAIN A COPY (WITHOUT EXHIBITS) OF THE COMPANY'S ANNUAL
REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2000 AS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION WITHOUT CHARGE BY WRITING TO: DIRECTOR OF
INVESTOR RELATIONS, DENTSPLY INTERNATIONAL INC., 570 WEST COLLEGE AVENUE, YORK,
PENNSYLVANIA 17405-0872.
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OTHER MATTERS
The Board of Directors knows of no matters which are to be brought before
the Annual Meeting other than those set forth in the accompanying Notice of
Annual Meeting of Stockholders. If any other matters properly come before the
Annual Meeting, the person named in the enclosed proxy card, or his duly
appointed substitute acting at the Annual Meeting, will be authorized to vote or
otherwise act thereon in accordance with his judgment on such matters.
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APPENDIX A
DENTSPLY INTERNATIONAL, INC.
AUDIT & INFORMATION TECHNOLOGY COMMITTEE
CHARTER
I. PURPOSE
The primary function of the Audit & Information Technology Committee
("Committee") is to assist the Board of Directors ("Board") in fulfilling its
oversight responsibilities related to corporate accounting, financial reporting
practices, quality and integrity of financial reports as well as legal
compliance, business ethics and review of information technology matters. It
shall be the policy of the Committee to maintain free and open communication
between the Board, the independent auditors, the internal auditors and the
management of the company.
II. ORGANIZATION
1. MEMBERS -- The Committee shall be composed of directors who are independent
of the management of the Company and are free of any relationship that, in
the opinion of the Board, would interfere with their exercise of independent
judgement as a committee member. Committee members shall be nominated by the
Board, and the Committee shall be composed of not less than three
independent Directors who are financially literate.
2. MEETINGS -- The Committee should meet on a regular basis and special
meetings should be called as circumstances require. The Committee shall meet
privately from time to time with representatives of the Company's
independent public accountants, the internal auditor and management. Written
minutes should be kept for all meetings.
III. FUNCTIONS
1. INDEPENDENT ACCOUNTANTS -- Recommend to the Board annually, the firm to be
employed by the Company as its independent accountants. Instruct the
independent accountants that they are ultimately responsible to the Board
and the Committee. Receive from the independent accountants a formal written
statement delineating all relationships between the independent accountants
and the Company, confirming their objectivity and independence, including in
regard to scope of services.
2. AUDIT PLANS & RESULTS -- Review the plans, scope, fees and results for the
annual audit and the internal audits with the independent auditors and the
internal auditors. Inquire of management and the independent auditor if any
significant financial reporting issues arose during the current audit and,
if so, how they were resolved. Discuss any significant issues, if any,
raised by the independent auditors in their Letter of Recommendations to
Management regarding internal control weaknesses and process improvements.
Also review the extent of any services and fees outside the audit area
performed for the Company by its independent accountants.
3. ACCOUNTING PRINCIPLES AND DISCLOSURES -- Review significant developments in
accounting rules and recommended changes in the Company's methods of
accounting or financial statements. The Committee also shall review with the
independent accountants the quality and acceptability of the application of
the Company's accounting principles to the Company's financial reporting,
including any significant proposed changes in accounting principles and
financial statements.
4. INTERNAL ACCOUNTING CONTROLS -- Consult with the independent accountants
regarding the adequacy of internal accounting controls. Inquire as to the
adequacy of the Company's accounting, financial, and auditing personnel
resources. As appropriate, consultation with the independent accountants
regarding internal controls should be conducted out of management's
presence.
5. INTERNAL CONTROL SYSTEMS -- Review with management and internal auditors the
Company's internal control systems intended to ensure the reliability of
financial reporting and compliance with applicable codes of conduct, laws,
and regulations. Reports on internal audit projects with management
responses shall be
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available for Committee review. Special presentations may be requested of
Company personnel responsible for such areas as legal, human resources,
information technology, environmental, risk management, tax compliance and
others as considered appropriate.
6. INFORMATION TECHNOLOGY -- Review information technology plans with respect
to corporate goals, industry trends, and competitive advantages. Review and
assess the security of computer systems and applications and contingency
plans for computer system breakdowns, particularly with respect to the
processing of financial information.
In carrying out its responsibilities, the Committee believes that its policies
and procedures should remain flexible in order that it can best react to
changing conditions and environment and to assure to the directors and
shareholders that the corporate accounting and reporting practices of the
Company are in accordance with all requirements and are of the highest quality.
19
23
PROXY PROXY
DENTSPLY INTERNATIONAL INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS
ANNUAL MEETING OF STOCKHOLDERS
MAY 23, 2001
The undersigned stockholder of DENTSPLY International Inc. (the
"Company") hereby appoints Brian M. Addison as the attorney and proxy of the
undersigned, with full power of substitution, to vote all shares of Common
Stock, par value $.01 per share, of the Company which the undersigned would be
entitled to vote if personally present at the Annual Meeting of Stockholders of
the Company, to be held at the Company's Employee Meeting Room, 570 West College
Avenue, York, Pennsylvania, on Wednesday, May 23, 2001, commencing at 9:30 a.m.,
local time, and at any adjournment or postponement thereof, as follows:
(CONTINUED AND TO BE SIGNED ON OTHER SIDE)
24
DENTSPLY INTERNATIONAL INC.
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. / /
1. Election of Class III Directors: For Withhold For All
Nominees: 01-Michael J. Coleman, 02-John C. Miles II and 03-W. Keith Smith All All Except
Instruction: TO WITHHOLD AUTHORITY to vote for any individual nominee,
mark the oval "For All Except" and write that nominee's name in the space / / / / / / ____________________
provided. Nominee Exception(s)
2. Proposal to ratify the appointment of PricewaterhouseCoopers, LLP, For Against Abstain
independent certified accountants, to audit the books and accounts of the
Company for the year ending December 31, 2001
/ / / / / /
In his discretion, the proxy holder is authorized to vote upon such other
matters as may properly come before the meeting.
UNLESS OTHERWISE SPECIFIED, THE SHARES OF COMMON STOCK REPRESENTED HEREBY WILL
BE VOTED "FOR" THE ELECTION AS CLASS III DIRECTORS OF ALL THE NOMINEES LISTED
AND "FOR" PROPOSAL 2.
Dated: ________________________________, 2001
_____________________________________________________
Signature of Stockholder
_____________________________________________________
Signature of Stockholder
NOTE: Please sign this proxy exactly as name(s) appear on your stock certificate. When signing as attorney-in-fact, executor,
administrator, trustee or guardian, please add your title as such, and if signer is a corporation, please sign with full corporate
name by a duly authorized officer or officers and affix the corporate seal. Where stock is issued in the name of two (2) or more
persons, all such persons should sign.
IMPORTANT: PLEASE SIGN, DATE AND RETURN PROMPTLY.
o FOLD AND DETACH HERE o
CONTROL NUMBER
PLEASE VOTE, SIGN, DATE AND RETURN THIS PROXY FORM
PROMPTLY USING THE ENCLOSED ENVELOPE.
OR
TO VOTE BY INTERNET, FOLLOW THE INSTRUCTIONS BELOW:
o Go to the following website: www.computershare.com/us/proxy
o Enter the information requested on the computer screen, including your
six digit Control Number located above
o Follow instructions on the screen
IF YOU VOTE BY INTERNET, DO NOT MAIL THIS PROXY CARD
25
- -----------------------------------------------------------------------------
[LOGO] DENTSPLY INTERNATIONAL INC.
570 West College Avenue
P.O. Box 872
York, PA 17405-0872
(717) 845-7511
Fax (717) 849-4753
April 19, 2001
Dear DENTSPLY ESOP Participant:
AS A PARTICIPANT IN THE DENTSPLY EMPLOYEE STOCK OWNERSHIP PLAN, YOU HAVE THE
RIGHT TO DIRECT THE ESOP TRUSTEE TO VOTE THE SHARES OF DENTSPLY COMMON STOCK
ALLOCATED TO YOUR ESOP ACCOUNT.
Enclosed for your information are: a proxy statement providing background for
the proposals to be acted upon at DENTSPLY's 2001 Annual Meeting of
Stockholders, and the Annual Report for DENTSPLY for the year ending December
31, 2000. Please read the proxy statement carefully, and decide how you want the
trustee to vote the shares of stock that are allocated to your ESOP account.
Then, fill in the enclosed voting instruction card to direct the ESOP trustee,
T. Rowe Price Retirement Plan Services, Inc., how to vote the shares in your
ESOP account.
YOUR VOTE IS IMPORTANT.
The ESOP trustee will vote your shares as you direct. Any shares for which the
ESOP trustee receives no voting instructions, and any unallocated shares, will
be voted by the ESOP trustee as instructed by the DENTSPLY ESOP Committee.
YOUR VOTE IS CONFIDENTIAL.
Your voting instructions will be kept confidential by the ESOP trustee. Voting
tabulations that identify individual ESOP participants will not be disclosed to
DENTSPLY.
MAKE YOUR VOTE COUNT.
Please review the proxy statement, then vote by mail or through the internet by
following the instructions on the proxy card. Proxy votes must be received no
later than May 21, 2001.
Very truly yours,
/s/ JOHN C. MILES II
John C. Miles II
Chairman of the Board and
Chief Executive Officer
26
VOTING INSTRUCTIONS
DENTSPLY INTERNATIONAL INC.
ANNUAL MEETING OF STOCKHOLDERS, MAY 23, 2001
To T. Rowe Price Retirement Plan Services, Inc., Trustee:
As a participant in the DENTSPLY International Inc. Employee Stock
Ownership Plan (the "ESOP"), I hereby instruct you to vote the shares of Common
Stock, par value $.01 per share ("Common Stock"), of DENTSPLY International Inc.
(the "Company") allocated to my ESOP account (a) in accordance with the
following direction and (b) to grant a proxy to the proxy nominated by the
Company's Board of Directors authorizing him to vote in his discretion upon such
other matters as may properly come before the meeting.
(CONTINUED AND TO BE SIGNED ON OTHER SIDE)
27
DENTSPLY INTERNATIONAL INC.
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. / /
1. Election of Class III Directors: For Withhold For All
Nominees: 01-Michael J. Coleman, 02-John C. Miles II and 03-W. Keith Smith All All Except
Instruction: TO WITHHOLD AUTHORITY to vote for any individual nominee,
mark the oval "For All Except" and write that nominee's name in the space / / / / / / ____________________
provided. Nominee Exception(s)
2. Proposal to ratify the appointment of PricewaterhouseCoopers, LLP, For Against Abstain
independent certified accountants, to audit the books and accounts of the
Company for the year ending December 31, 2001
/ / / / / /
In his discretion, the proxy holder is authorized to vote upon such other
matters as may properly come before the meeting.
UNLESS OTHERWISE SPECIFIED, THE SHARES OF COMMON STOCK REPRESENTED HEREBY WILL
BE VOTED "FOR" THE ELECTION AS CLASS III DIRECTORS OF ALL THE NOMINEES LISTED
AND "FOR" PROPOSAL 2.
Dated: ________________________________, 2001
_____________________________________________________
Signature of Stockholder
_____________________________________________________
Signature of Stockholder
NOTE: Please sign this proxy exactly as name(s) appear on your stock certificate. When signing as attorney-in-fact, executor,
administrator, trustee or guardian, please add your title as such, and if signer is a corporation, please sign with full corporate
name by a duly authorized officer or officers and affix the corporate seal. Where stock is issued in the name of two (2) or more
persons, all such persons should sign.
IMPORTANT: PLEASE SIGN, DATE AND RETURN PROMPTLY.
o FOLD AND DETACH HERE o
CONTROL NUMBER
PLEASE VOTE, SIGN, DATE AND RETURN THIS PROXY FORM
PROMPTLY USING THE ENCLOSED ENVELOPE.
OR
TO VOTE BY INTERNET, FOLLOW THE INSTRUCTIONS BELOW:
o Go to the following website: www.computershare.com/us/proxy
o Enter the information requested on the computer screen, including your
six digit Control Number located above
o Follow instructions on the screen
IF YOU VOTE BY INTERNET, DO NOT MAIL THIS PROXY CARD
28
- -----------------------------------------------------------------------------
[LOGO] DENTSPLY INTERNATIONAL INC.
570 West College Avenue
P.O. Box 872
York, PA 17405-0872
(717) 845-7511
Fax (717) 849-4753
April 19, 2001
Dear DENTSPLY 401(k) Participant:
AS A PARTICIPANT IN THE DENTSPLY 401(K) SAVINGS PLAN, YOU HAVE THE RIGHT TO
DIRECT THE 401(K) TRUSTEE TO VOTE THE SHARES OF DENTSPLY COMMON STOCK HELD IN
YOUR 401(K) ACCOUNT.
Enclosed for your information are: a proxy statement providing background for
the proposals to be acted upon at DENTSPLY's 2001 Annual Meeting of
Stockholders, and the Annual Report for DENTSPLY for the year ending December
31, 2000. Please read the proxy statement carefully, and decide how you want the
trustee to vote the shares of stock that are allocated to your 401(k) account.
Then, fill in the enclosed voting instruction card to direct the 401(k) trustee,
T. Rowe Price Retirement Plan Services, Inc., how to vote the shares in your
401(k) account.
YOUR VOTE IS IMPORTANT.
The 401(k) trustee will vote your shares as you direct. Any shares for which the
401(k) trustee receives no voting instructions will be voted by the 401(k)
trustee as instructed by the DENTSPLY 401(k) Committee.
YOUR VOTE IS CONFIDENTIAL.
Your voting instructions will be kept confidential by the 401(k) trustee. Voting
tabulations that identify individual 401(k) participants will not be disclosed
to DENTSPLY.
MAKE YOUR VOTE COUNT.
Please review the proxy statement, then vote by mail or through the internet by
following the instructions on the proxy card. Proxy votes must be received no
later than May 21, 2001.
Very truly yours,
/s/ JOHN C. MILES II
John C. Miles II
Chairman of the Board and
Chief Executive Officer
29
VOTING INSTRUCTIONS
DENTSPLY INTERNATIONAL INC.
ANNUAL MEETING OF STOCKHOLDERS, MAY 23, 2001
To T. Rowe Price Retirement Plan Services, Inc., Trustee:
As a participant in the DENTSPLY International Inc. 401(k) Savings Plan
(the "401(k)"), I hereby instruct you to vote the shares of Common Stock, par
value $.01 per share ("Common Stock"), of DENTSPLY International Inc. (the
"Company") allocated to my 401(k) account (a) in accordance with the following
direction and (b) to grant a proxy to the proxy nominated by the Company's Board
of Directors authorizing him to vote in his discretion upon such other matters
as may properly come before the meeting.
(CONTINUED AND TO BE SIGNED ON OTHER SIDE)
30
DENTSPLY INTERNATIONAL INC.
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. / /
1. Election of Class III Directors: For Withhold For All
Nominees: 01-Michael J. Coleman, 02-John C. Miles II and 03-W. Keith Smith All All Except
Instruction: TO WITHHOLD AUTHORITY to vote for any individual nominee,
mark the oval "For All Except" and write that nominee's name in the space / / / / / / ____________________
provided. Nominee Exception(s)
2. Proposal to ratify the appointment of PricewaterhouseCoopers, LLP, For Against Abstain
independent certified accountants, to audit the books and accounts of the
Company for the year ending December 31, 2001
/ / / / / /
In his discretion, the proxy holder is authorized to vote upon such other
matters as may properly come before the meeting.
UNLESS OTHERWISE SPECIFIED, THE SHARES OF COMMON STOCK REPRESENTED HEREBY WILL
BE VOTED "FOR" THE ELECTION AS CLASS III DIRECTORS OF ALL THE NOMINEES LISTED
AND "FOR" PROPOSAL 2.
Dated: ________________________________, 2001
_____________________________________________________
Signature of Stockholder
_____________________________________________________
Signature of Stockholder
NOTE: Please sign this proxy exactly as name(s) appear on your stock certificate. When signing as attorney-in-fact, executor,
administrator, trustee or guardian, please add your title as such, and if signer is a corporation, please sign with full corporate
name by a duly authorized officer or officers and affix the corporate seal. Where stock is issued in the name of two (2) or more
persons, all such persons should sign.
IMPORTANT: PLEASE SIGN, DATE AND RETURN PROMPTLY.
o FOLD AND DETACH HERE o
CONTROL NUMBER
PLEASE VOTE, SIGN, DATE AND RETURN THIS PROXY FORM
PROMPTLY USING THE ENCLOSED ENVELOPE.
OR
TO VOTE BY INTERNET, FOLLOW THE INSTRUCTIONS BELOW:
o Go to the following website: www.computershare.com/us/proxy
o Enter the information requested on the computer screen, including your
six digit Control Number located above
o Follow instructions on the screen
IF YOU VOTE BY INTERNET, DO NOT MAIL THIS PROXY CARD