SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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 Pursuant to Section 240.14a-11(c) or Section 240.14a-12
Respironics, Inc.
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(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)(4) and 0-11.
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pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
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paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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Notes:
[LOGO OF RESPIRONICS, INC.]
Dear Shareholder:
You are cordially invited to join us for our Annual Meeting of Shareholders to
be held this year on Thursday, November 18, 1999, at 1:00 p.m. (local time) at
Two Mellon Bank Center in the Auditorium on the Tenth Floor, at 501 Grant
Street, Pittsburgh, Pennsylvania.
The Notice of Annual Meeting of Shareholders and the Proxy Statement that
follow describe the business to be conducted at the meeting. We will also
report on matters of current interest to our shareholders.
Representatives of the Company will be in attendance beginning at 12:00 p.m.
Please also take this opportunity to view Respironics products, which will be
on display.
Your vote is important. Whether you own a few or many shares of stock, it is
important that your shares be represented. If you cannot personally attend, we
encourage you to make certain that you are represented at the meeting by
signing the accompanying proxy card and promptly returning it in the enclosed
envelope.
Very truly yours,
/s/ James W. Liken
James W. Liken
President and Chief Executive
Officer
October 25, 1999
RESPIRONICS, INC.
1501 Ardmore Boulevard
Pittsburgh, Pennsylvania 15221-4401
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
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The Annual Meeting of Shareholders of Respironics, Inc. will be held at Two
Mellon Bank Center at 501 Grant Street, Pittsburgh, Pennsylvania on Thursday,
November 18, 1999 at 1:00 p.m., in the Auditorium on the Tenth Floor, for the
following purposes:
(1) To elect six directors;
(2) To ratify the selection of auditors to examine the consolidated
financial statements of the Company for the fiscal year ending June
30, 2000; and
(3) To transact such other business as may properly come before the
meeting.
Please refer to the accompanying Proxy Statement for a description of the
matters to be considered at the meeting.
Please sign, date and return the enclosed proxy promptly in the envelope
provided, which requires no United States postage.
Dorita A. Pishko
Corporate Secretary
October 25, 1999
RESPIRONICS, INC.
1501 Ardmore Boulevard
Pittsburgh, Pennsylvania 15221-4401
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PROXY STATEMENT
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Annual Meeting of Shareholders to be Held November 18, 1999
GENERAL
The enclosed proxy is solicited on behalf of the Board of Directors of
Respironics, Inc. (the "Company") for use at the Annual Meeting of
Shareholders to be held at 1:00 p.m., on Thursday, November 18, 1999 at Two
Mellon Bank Center at 501 Grant Street, Pittsburgh, Pennsylvania. The
accompanying Notice of Annual Meeting of Shareholders sets forth the purposes
of the meeting.
The enclosed proxy may be revoked at any time before its exercise by giving
notice of revocation to the Secretary of the Company. The shares represented
by proxies in the form solicited by the Board of Directors will be voted at
the meeting. If a choice is specified on the proxy with respect to a matter to
be voted upon, the shares represented by the proxy will be voted in accordance
with that specification. If no choice is specified, the shares will be voted
as stated below in this Proxy Statement.
It is expected that this Proxy Statement and the accompanying form of proxy
will first be mailed to shareholders of the Company on or about October 25,
1999. The Company's Annual Report on Form 10-K for 1999 is enclosed with this
Proxy Statement but does not form a part of the proxy soliciting material.
SHAREHOLDER PROPOSALS FOR 2000 ANNUAL MEETING
If any shareholder wishes to present a proposal at the 2000 Annual Meeting
of Shareholders, the proposal must be received by the Secretary of the Company
by June 27, 2000 to be considered for inclusion in the Company's Proxy
Statement and form of proxy relating to the 2000 Annual Meeting. The Bylaws of
the Company require that any shareholder intending to present a proposal for
action at an Annual Meeting must give written notice of the proposal,
containing the information specified in the Bylaw, so that it is received by
the Company not later than the notice deadline determined under the Bylaw.
This notice deadline will generally be 90 days prior to the anniversary of the
Company's Proxy Statement for the previous year's anual meeting, or July 27,
2000 for the Company's Annual Meeting in 2000. Any shareholder proposal
received by the Secretary of the Company after July 27, 2000 will be
considered untimely under Rule 14a-4(c)(1) promulgated by the Securities and
Exchange Commission under the Securities Exchange Act of 1934. The 2000 Annual
Meeting is presently scheduled for November 16, 2000.
VOTING SECURITIES AND RECORD DATE
Holders of the Company's Common Stock of record as of the close of business
on October 1, 1999 (the "record date") are entitled to receive notice of and
to vote at the meeting. On the record date, the Company had outstanding
30,177,123 shares of Common Stock, the holders of which are entitled to one
vote per share. These shares outstanding exclude 2,898,783 shares held in
treasury.
SECURITY OWNERSHIP
Management
The following table shows the number of shares of Common Stock beneficially
owned by each director and nominee for director of the Company, each of the
officers of the Company named in the Summary Compensation Table herein and by
all directors, nominees and executive officers of the Company as a group, as
of the record date. As used herein, "beneficial ownership" means the sole or
shared power to vote, or to direct the voting of, a security, or the sole or
shared investment power with respect to a security (i.e., the power to dispose
of, or to direct the disposition of, a security). A person is deemed, as of
any date, to have "beneficial ownership" of any security that the person has
the right to acquire within 60 days after that date.
1
Amount and
Nature of
Beneficial Percent
Name of Beneficial Owner Ownership of Class
- ------------------------ ---------- ---------
Daniel P. Barry (1)....................................... 19,732 0.07%
Douglas A. Cotter (1)..................................... 36,432 0.12%
Robert D. Crouch (2)...................................... 284,053 0.94%
J. Terry Dewberry (1) (9)................................. 112,564 0.37%
James H. Hardie (1) (3)................................... 53,632 0.18%
Donald H. Jones (1)....................................... 20,632 0.07%
Joseph C. Lawyer (1) (10)................................. 25,632 0.08%
James W. Liken............................................ 105,365 0.35%
Candace L. Littell........................................ 0 0.00%
Gerald E. McGinnis (4).................................... 821,448 2.72%
Dennis S. Meteny (5)...................................... 356,075 1.18%
John C. Miclot (6)........................................ 86,643 0.29%
Craig B. Reynolds (7)..................................... 273,157 0.90%
Robert E. Tucker (8)...................................... 130,498 0.43%
J. Paul Yokubinas (11).................................... 69,202 0.23%
All directors, nominees, and executives officers as a
group (19 persons)....................................... 2,139,299 6.91%
- --------
(1) Includes shares which would be outstanding upon the exercise of currently
exercisable stock options granted under the 1991 Non-Employee Directors'
Stock Option Plan in the following amounts: Mr. Barry, 14,025 shares; Dr.
Cotter, 34,425 shares; Mr. Dewberry, 1,275 shares; Mr. Hardie, 31,925
shares; Mr. Jones, 8,925 shares; and Mr. Lawyer, 19,125 shares.
(2) Includes 154,050 shares that would be outstanding upon the exercise of
currently exercisable stock options granted under the Company's 1984
Incentive Stock Option Plan and 1992 Stock Incentive Plan. Also includes
2,463 shares in Mr. Crouch's 401(k) plan account, for which he has the
power to direct the voting. For purposes of comparison, the correct
number of shares beneficially owned by Mr. Crouch as of October 2, 1998,
the prior year's record date, was 273,750, rather than the 307,966
incorrectly reported in the Company's 1998 proxy statement.
(3) Includes 14,000 shares held by a partnership in which Mr. Hardie is the
general partner and 6,900 shares held in Mr. Hardie's personal IRA
account. Does not include 18,000 shares owned by Mr. Hardie's wife, as to
which he disclaims beneficial ownership.
(4) Includes 145,198 shares held in the Gerald E. McGinnis Charitable
Foundation and 30,000 shares held in the Gerald E. and Audrey L. McGinnis
Charitable Remainder Unitrust. Includes 24,800 shares held jointly with
Mr. McGinnis' wife, as to which voting and investment power is shared.
Includes 343,700 shares held by a partnership in which Mr. McGinnis is a
general partner. Includes 10,500 shares that would be outstanding upon
the exercise of currently exercisable stock options granted under the
Company's 1992 Stock Incentive Plan. Also includes 3,250 shares in Mr.
McGinnis' 401(k) plan account, for which he has the power to direct the
voting. For purposes of comparison, the correct number of shares
beneficially owned by Mr. McGinnis as of October 2, 1998, the prior
year's record date, was 788,964, rather than the 917,886 incorrectly
reported in the Company's 1998 proxy statement.
(5) Includes 289,970 shares held jointly with Mr. Meteny's wife, as to which
voting and investment power is shared, and 4,000 shares held by Mr.
Meteny's minor children, as to which he controls voting and investment
power. Also included are 56,155 shares that would be outstanding upon the
exercise of currently exercisable stock options granted under the
Company's 1984 Incentive Stock Option Plan and 1992 Stock Incentive Plan.
Also includes 5,950 shares in Mr. Meteny's 401(k) plan account, for which
he has the power to direct the voting.
(6) Includes 86,051 shares that would be outstanding upon the exercise of
currently exercisable stock options, certain of which were granted to Mr.
Miclot by Healthdyne and were converted into options to purchase the
Company's Common Stock pursuant to the merger involving Healthdyne, and
certain of which were granted under the Company's 1992 Stock Incentive
Plan.
(7) Includes 242,998 shares that would be outstanding upon the exercise of
currently exercisable stock options, certain of which were granted to Mr.
Reynolds by Healthdyne and were converted into options to purchase
2
the Company's Common Stock pursuant to the merger involving Healthdyne, and
certain of which were granted under the Company's 1992 Stock Incentive
Plan.
(8) Includes 106,576 shares that would be outstanding upon the exercise of
currently exercisable stock options, certain of which were granted to Mr.
Tucker by Healthdyne and were converted into options to purchase the
Company's Common Stock pursuant to the merger involving Healthdyne, and
certain of which were granted under the Company's 1992 Stock Incentive
Plan.
(9) Includes 6,146 shares that would be outstanding upon the exercise of
currently exercisable stock options which were granted to Mr. Dewberry by
Healthdyne Technologies, Inc. ("Healthdyne") and which were converted
into options to purchase the Company's Common Stock pursuant to the
merger involving Healthdyne.
(10) Does not include 2,400 shares held by Mr. Lawyer's wife who has sole
voting and investment power of these shares and as to which Mr Lawyer
disclaims beneficial ownership.
(11) Includes 2,411 shares held jointly with Mr. Yokubinas' wife, as to which
voting and investment power is shared.
Other Beneficial Owners
The following table sets forth information with respect to each shareholder
known to the Company to be the beneficial owner of more than 5% of the
outstanding Common Stock as of the record date.
Amount and
Nature of
Beneficial Percent
Name and Address of Beneficial Owner Ownership of Class
- ------------------------------------ ---------- --------
Snyder Capital Management, L.P.
350 California Street, Suite 1460
San Francisco, CA 94140 (1)................................. 3,145,000 10.42%
Fidelity Management & Research Company
82 Devonshire Street
Boston, MA 02109 (2)........................................ 2,085,500 6.91%
- --------
(1) Based on disclosure by Snyder Capital Management, L.P. as of October 1,
1999. Snyder Capital Management, L.P. has shared dispositive power over
all of these shares, shared voting power over 2,828,100 of these shares,
and no voting power over 316,900 of these shares.
(2) Information regarding the beneficial owner has been determined by the
Company based solely upon data included in a Form 13G filed with the
United States Securities and Exchange Commission and with the Company on
February 12, 1999. Such filing contained information as of December 31,
1998.
BOARD OF DIRECTORS AND COMMITTEES OF THE BOARD
The Board of Directors has five committees to assist in the management of
the affairs of the Company: the Stock Option Committee, the Compensation
Committee, the Audit Committee, the Nominating Committee and the Strategy
Committee.
Stock Option Committee. The Stock Option Committee (the "Stock Option
Committee") currently consists of Messrs. Lawyer (Chairman) and Dewberry. The
Stock Option Committee administers the Company's 1984 Incentive Stock Option
Plan and the 1992 Stock Incentive Plan, and has the authority to grant options
thereunder.
The Compensation Committee. The Compensation Committee consists of Messrs.
Lawyer (Chairman), Dewberry and Hardie. The Compensation Committee makes
recommendations regarding the compensation payable, including compensation
under the Company's bonus plan, to all executive officers of the Company and
certain other management personnel.
3
Audit Committee. The Audit Committee consists of Messrs. Barry (Chairman),
Cotter and Yokubinas. This committee assists the Board in fulfilling its
functions relating to corporate accounting and reporting practices and
financial and accounting controls.
Nominating Committee. The Nominating Committee consists of Messrs. McGinnis
(Chairman), Liken and Reynolds. The Nominating Committee reviews the size and
composition of the Board of Directors and makes recommendations with respect
to nominations for directors. The Nominating Committee will consider nominees
recommended by shareholders provided that shareholders submit the names of
nominees in writing to the Secretary of the Company together with a statement
of the nominee's qualifications. Such information should be received no later
than July 27, 2000 with respect to nominations for election at the 2000 Annual
Meeting of Shareholders.
Strategy Committee. The Strategy Committee consists of all Directors. The
Strategy Committee makes recommendations to the Board of Directors with
respect to general corporate strategy, including the development or
acquisition of present and new products, and the development of strategies for
continued growth and profitability of the Company's business.
The Compensation and Stock Option Committees and the Audit Committee both
met two times, the Strategy Committee met four times, and the Nominating
Committee met one time in fiscal year 1999. Each of these committees also met
informally by telephone during the fiscal year as needed. The Board of
Directors held four regular meetings and two special meetings during fiscal
year 1999.
Each director who is not an employee of the Company receives an annual fee
of $9,600 for his service as a director and committee member. Non-employee
directors receive a fee of $500 for attendance at meetings of the full Board
of Directors. In addition, each non-employee director serving as a committee
chairperson receives $600 while all other committee members receive $300 for
attendance at committee meetings. The annual fee is paid in shares of the
Company's common stock having a fair market value on the date of payment equal
to the fee being paid. All other fees are paid in cash. All directors are
reimbursed for travel expenses related to meetings of the Board. Directors of
the Company who are not employees also hold and receive stock options under
the Company's 1991 Non-Employee Directors' Stock Option Plan. Under this Plan,
each non-employee director is granted an option on the third business day
following each Annual Meeting of Shareholders to purchase 5,100 shares of the
Company's Common Stock at the fair market value on such date. Each option has
a term of 10 years, is exercisable in installments and becomes fully
exercisable after three years from date of grant.
MATTERS TO BE ACTED UPON
1. ELECTION OF DIRECTORS
The Board of Directors, acting pursuant to the Restated Certificate of
Incorporation of the Company, has determined that the number of directors
constituting the full Board of Directors shall be eleven at the present time.
The Board is divided into three classes. One such class is elected every
year at the Annual Meeting of Shareholders for a term of three years.
Accordingly, a class is to be elected at the 1999 Annual Meeting of
Shareholders, with each director so elected to hold office until the 2002
Annual Meeting of Shareholders or until the director's prior death,
disability, resignation or removal. Two additional directors are also to be
elected at the 1999 Annual Meeting, one to hold office until the 2001 Annual
Meeting of Shareholders and one to hold office until the 2000 Annual Meeting
of Shareholders, respectively, or until the director's prior death,
disability, resignation or removal.
4
The Restated Certificate of Incorporation of the Company provides that the
size of the Board of Directors shall be determined by the Board of Directors.
Vacancies in the Board of Directors may be filled by Board action. The term of
office of any director so elected to the Board by the Board itself lasts until
the next election of the class of directors to which such director was
elected.
The Board of Directors has nominated Daniel P. Barry, J. Terry Dewberry,
Donald H. Jones and James W. Liken for reelection to the Board for the class
of 2002, Candace L. Littell for election to the Board for the class of 2001,
and J. Paul Yokubinas for reelection to the Board for the class of 2000, and
each of them has agreed to serve if elected. The Board of Directors recommends
that the shareholders vote "FOR" the election of the six persons nominated to
the Board of Directors. Proxies are solicited in favor of these nominees and
will be voted for them unless otherwise specified. If any nominee becomes
unable or unwilling to serve as director, it is intended that the proxies will
be voted for the election of such other person, if any, as shall be designated
by the Board of Directors.
Information concerning those nominees for director (classes of 2002, 2001
and 2000) and the other directors who will continue in office after the
meeting (classes of 2000 and 2001) is set forth below.
Name Position with the Company
---- -------------------------
Class of 2002
Daniel P. Barry Director
J. Terry Dewberry Director
Donald H. Jones Director
James W. Liken President, Chief Executive Officer and Director
Class of 2001
Douglas A. Cotter Ph.D. Director
Gerald E. McGinnis Chairman of the Board
Craig B. Reynolds Executive Vice President, Chief Operating Officer and Director
Candace L. Littell None
Class of 2000
James H. Hardie Director
Joseph C. Lawyer Director
J. Paul Yokubinas Director
Mr. Barry is 52 years old and a private investor. He has been a director of
the Company since August 1995. Mr. Barry had been the Vice Chairman of the
former AMSCO International, Inc. ("AMSCO") (now merged with Steris
Corporation) from July 1995 through May 1996. Prior to that, he served as
President and Chief Executive Officer of AMSCO from October 1994 through July
1995 and had been the Chief Financial Officer of, as well as serving in
various other executive and consulting capacities with, AMSCO since 1981. Mr.
Barry was a director of AMSCO from 1991 through 1996. He is also a director of
Tollgrade Communications, Inc.
Dr. Cotter is 56 years old. He has been a director of the Company since
February 1989. In April of 1998, Dr. Cotter re-established Healthcare
Decisions, Inc., a Massachusetts health care and biotechnology consulting firm
specializing in corporate development, strategic planning and acquisitions.
Dr. Cotter is the President of Healthcare Decisions, Inc. Between April 1996
and March 1998, Dr. Cotter was Vice President of Decision Resources, an
international consulting firm specializing in the health care industry
(primarily pharmaceuticals). From 1985 to 1996, he was President of the above-
mentioned Healthcare Decisions, Inc. For nineteen years prior to joining
Healthcare Decisions, Dr. Cotter was employed by Corning Glass Works, where he
held various management positions in research, product development and
clinical information systems.
Mr. Dewberry, age 55, is a private investor. He has served as a director of
the Company since the completion of the merger between the Company and
Healthdyne on February 11, 1998. From March 1992 until March 1996, Mr.
Dewberry was Vice Chairman of Healthdyne, Inc. From 1984 to 1992, Mr. Dewberry
served
5
as President and Chief Operating Officer, and Executive Vice President of
Healthdyne. He is also a Director of Healthdyne Information Enterprises, Inc.
Mr. Hardie is 69 years old. He has been a director of the Company since
November 1991. He is a lawyer and of counsel to Reed Smith Shaw & McClay LLP,
a law firm with principal offices in Pittsburgh, Washington, Philadelphia, New
York and Princeton, NJ, which since 1988 has performed legal services for the
Company. Mr. Hardie was a partner of that firm from 1962 through June 1999. He
is a director of a number of other corporations, the securities of which are
not publicly traded.
Mr. Jones is 62 years old. He has been a director of the Company since May
1996. Currently, Mr. Jones serves as chairman of Triangle Capital Corporation,
an investment banking and management firm. From 1990 to 1996, Mr. Jones served
as Chairman of IndustryNet, an online electronic commerce company linking
business-to-business buyers and sellers through electronic networks including
the Internet. Mr. Jones founded IndustryNet in 1990. In 1996 IndustryNet,
together with a subsidiary of another large corporation, was merged into Nets,
Inc. Mr. Jones was not an executive officer of Nets, Inc., which filed for
bankruptcy under Chapter 11 in May, 1997. In 1982 Mr. Jones launched
International Cybernetics Corporation ("ICC"), a developer of advanced factory
automation control systems. In 1985 Mr. Jones merged ICC into the Industrial
Automation Systems Division of Gould Electronics Inc. ("Gould") and he became
Vice President of Business Development for Gould. In 1988 the division was
sold to AEG, a West German based multinational company and Mr. Jones ceased to
be an officer. Mr. Jones is a director of The Associated Group Inc., a
telecommunications company; and Teligent Corporation, a national facilities
based competitive local exchange carrier.
Mr. Lawyer is 54 years old. He has been a director of the Company since
1994. Since 1988, he has been President, Chief Executive Officer and a
Director of Chatwins Group, Inc. ("CGI"), headquartered in Pittsburgh, which
designs, manufactures and markets a broad range of fabricated and machined
parts and products, in a variety of industries primarily to original equipment
manufacturers. From 1986 to 1988 he was President, Chief Executive Officer and
a Director of CP Industries, a predecessor company of CGI. Prior thereto, he
held various operations, marketing, sales, finance and strategic planning
positions for U.S. Steel Corporation for 17 years. Mr. Lawyer is also a
Director of American Architectural Products Corp.
Mr. Liken is 50 years old. He has served as a director of the Company since
January 1999 and President and Chief Executive Officer since August 1999. Mr.
Liken was President and owner of Liken Home Medical, Inc. from 1990 until he
sold that business in July 1998. Mr. Liken was a private investor from July
1998 until August 1999. In addition, Mr. Liken was a consultant to the Company
from July 1998 until January 1999. Mr. Liken has been active in the home
medical business since 1971, serving in management and ownership capacities
for several predecessor companies to Liken Home Medical, Inc. Mr. Liken has
also served on Board of Directors of the National Association for Medical
Equipment Services (NAMES) since 1984 and was the Chairman of that board from
1987 to 1989 and again from 1997 to 1998. Since 1997, Mr. Liken has been a
member of the Business Advisory Council of the Federal Reserve Bank of
Cleveland.
Ms. Littell is 42 years old. She previously served as a director of the
Company in 1997. From January 1995 through January 1998, and again since
September 1999, she has been the President of C L Littell & Associates, Inc.,
a consulting firm, headquartered in Virginia, specializing in health policy,
payment and outcomes management for medical technology companies and related
health care organizations. During the period February 1998 through August
1999, Ms. Littell served as Senior Health Policy Advisor to the Health
Industry Manufacturers Association ("HIMA"), where she advised the
association's membership and executive management on health care financing
developments affecting the medical technology industry. Between 1992 and 1994,
Ms. Littell was Executive Director of the Health Care Technology Institute, a
privately funded organization where she oversaw the development of research
related to the impact on the economy of the medical technology industry. From
1989 through 1991, she served as Vice President of Payment and Policy of HIMA.
6
Mr. McGinnis is 65 years old. He has been a director of the Company since
1977 and Chairman of the Board since November 1994. He served as Chief
Executive Officer of the Company between 1977 and 1994, and President between
1984 and 1994. Prior to 1977, Mr. McGinnis was President of Lanz Medical
Products Corporation, the predecessor to the Company. From 1971 to 1975, Mr.
McGinnis also served on the staff of the Critical Care Department,
Presbyterian University Hospital, Pittsburgh, where he participated in various
medical engineering programs seeking the application of technology to medical
care. Prior thereto, Mr. McGinnis was head of the Surgical Research Department
at Allegheny General Hospital, Pittsburgh, for two years and for eleven years
he was employed at the research and development laboratory of Westinghouse
Electric Corporation. At Westinghouse he served six years as the Manager of
the Bio-Engineering Department and headed the medical product development
activities.
Mr. Reynolds is 50 years old. He has been a director of the Company since
the completion of the merger between the Company and Healthdyne on February
11, 1998. Prior to joining the Company, Mr. Reynolds served as President of
Healthdyne since January 1987 and Chief Executive Officer since 1993.
Previously, he served as President of the Healthdyne Cardiovascular Division
of Healthdyne, from January 1985 to December 1986 and as Vice President of
Business and Technology Development of the Technologies Division of Healthdyne
from January 1981 to December 1984.
Mr. Yokubinas is 61 years old and a private investor. He has been a director
of the Company since January 1999. Mr. Yokubinas joined Healthdyne, Inc. in
1979, serving in various managerial positions before being named President and
Chief Operating Officer in 1992. Mr. Yokubinas held that position until his
retirement in 1996.
2. SELECTION OF AUDITORS
The Board of Directors, following the recommendation of the Audit Committee,
has selected the independent public accounting firm of Ernst & Young LLP as
the auditors to examine the consolidated financial statements of the Company
for fiscal year 2000. The Board of Directors recommends that the shareholders
vote "FOR" ratification of the appointment of Ernst & Young LLP. The proxies
solicited on behalf of the Board of Directors will be voted to ratify
selection of that firm unless otherwise specified.
Ernst & Young LLP has served as the independent auditors for the Company
since 1984. Representatives of Ernst & Young LLP are expected to be present at
the Annual Meeting of Shareholders. They will have the opportunity to make
statements if they desire to do so and will be available to respond to
appropriate questions.
3. OTHER BUSINESS
The Board of Directors does not know of any other business to be presented
to the Annual Meeting of Shareholders. If any other matters properly come
before the meeting, however, the persons named in the enclosed form of proxy
will vote the proxy in accordance with their best judgment.
VOTE REQUIRED
Under Delaware law, the six nominees for election as directors at the Annual
Meeting of Shareholders who receive the greatest number of votes cast for the
election of directors by the holders of the Company's Common Stock present in
person or represented by proxy and entitled to vote at the meeting, a quorum
being present, will be elected as directors. The affirmative vote of the
holders of a majority of the shares of the Company's Common Stock present in
person or represented by proxy and entitled to vote at the Annual Meeting of
Shareholders, a quorum being present, is necessary for the ratification of the
selection of Ernst & Young LLP. The aggregate number of shares for which a
vote "For", "Against" or "Abstain" is made is counted for the purpose of
determining the minimum number of affirmative votes required for approval, and
the total number of votes cast "For" approval is counted for the purpose of
determining whether sufficient votes are received. An abstention from voting
on a matter other than election of directors by a shareholder present in
person or represented by
7
proxy and entitled to vote has the same legal effect as a vote "Against" the
matter. If a broker or similar nominee limits on a proxy card the number of
shares voted on a proposal or indicates that the shares represented by a proxy
card are not voted on the proposal, such broker "non-votes" will not be voted
on the proposal and will not be counted in determining the number of
affirmative votes required for approval.
EXECUTIVE COMPENSATION
The following table sets forth information concerning compensation paid to
the Chief Executive Officer of the Company and the four highest paid executive
officers other than the Chief Executive Officer (the "named officers") for
services rendered in all capacities to the Company and its subsidiaries during
the fiscal years ended June 30, 1999, 1998 and 1997.
Summary Compensation Table
Long Term Compensation
-----------------------------
Annual Compensation Awards Payouts
--------------------------- --------------------- -------
Other Securities
Annual Restricted Underlying LTIP All Other
Salary Bonus Compensation Stock Options/ Payouts Compensation
Name and Principal Position Year ($) (A) ($) ($) (B) Awards SAR's (#) ($) ($) (C)
- --------------------------- ---- ------- ------ ------------ ---------- ---------- ------- ------------
Dennis S. Meteny
President and Chief
Executive Officer (D) 1999 339,000 -- -- -- 25,300 -- 62,836
1998 277,491 25,000 -- -- 10,300 -- 30,000
1997 232,005 94,500 -- -- 10,600 -- 32,486
Craig B. Reynolds
Executive Vice
President, Chief
Operating Officer 1999 259,533 -- -- -- 18,100 -- 44,918
1998(E) 95,824 -- -- -- 40,000 -- 1,474
1997(F) -- -- -- -- -- -- --
Robert D. Crouch
Senior Vice President--
New Ventures and
Corporate Services 1999 229,577 -- -- -- 18,100 -- 44,979
1998 191,163 7,000 -- -- 4,300 -- 22,140
1997 162,207 65,025 -- -- 4,500 -- 23,034
John C. Miclot
Senior Vice President,
President--Homecare
Division 1999 212,548 15,000 -- -- 18,100 -- 94,626
1998(E) 77,592 -- -- -- 20,000 -- 86,140
1997(F) -- -- -- -- -- -- --
Robert E. Tucker
Vice President--New
Products 1999 206,281 -- -- -- 10,800 -- 41,171
1998(E) 77,592 -- -- -- 20,000 -- 2,800
1997(F) -- -- -- -- -- -- --
- --------
(A) This column represents base salary and includes tax deferred Section
401(k) contributions under the Company's Retirement Savings Plan.
(B) The dollar value of perquisites and other personal benefits is required
to be disclosed under this column if the amount for any named officer
equals or exceeds $50,000 or 10% of the total annual salary and bonus.
The dollar value of the perquisites and other personal benefits did not
exceed the threshold amount for any of the named officers for any of the
years covered in the table.
8
(C) The amounts in this column for 1999 represent the following: matching
contributions under the Company's Retirement Savings Plan (Mr. Meteny,
$4,800; Mr. Crouch, $4,800; Mr. Miclot, $4,800; Mr. Tucker, $4,800);
annuity plan premiums and related income tax gross ups paid on the
officer's behalf (Mr. Meteny, $58,036; Mr. Reynolds, $44,918; Mr. Crouch,
$40,179; Mr. Miclot, $36,371; Mr. Tucker, $36,371); and income tax gross
ups paid on relocation expenses (Mr. Miclot, $53,755).
(D) Mr. Meteny resigned as an officer of the Company on August 19, 1999 and
as a director of the Company on September 7, 1999.
(E) Messrs. Reynolds, Miclot and Tucker were employed by the Company
effective February 11, 1998. Amounts included herein represent
compensation for the period February 11, 1998 through June 30, 1998.
(F) Messrs. Reynolds, Miclot and Tucker were not executive officers of the
Company in fiscal year 1997.
Stock Options
The following table sets forth information concerning stock option grants
made to the named officers during the fiscal year ended June 30, 1999. The
Company has not granted any stock appreciation rights ("SAR's") to any of the
named officers or any other officers or employees of the Company.
Option Grants in Last Fiscal Year
All Executive Officers
Potential Realizable
Value at Assumed
Annual Rates of Stock
Price Appreciation for
Individual Grants Option Term
----------------------------------------------------------------------- -----------------------
Number of % of Total
Securities Options
Underlying granted to
Options employees Exercise or
Granted in fiscal Base Price
Name (#) (A) year ($/Sh) (B) Expiration Date (C) 5% ($) 10% ($)
- ---- ---------- ---------- ----------- ------------------- ----------- -----------
Dennis S. Meteny 25,300 5% 12.16 August 19, 1999 193,511 490,391
Craig B. Reynolds 18,100 4% 12.16 August 21, 2008 138,440 350,833
Robert D. Crouch 18,100 4% 12.16 August 21, 2008 138,440 350,833
John C. Miclot 18,100 4% 12.16 August 21, 2008 138,440 350,833
Robert E. Tucker 10,800 2% 12.16 August 21, 2008 82,605 209,337
- --------
(A) Options granted in fiscal year 1999 are exercisable starting 12 months
after the grant date, with 25% of the shares covered thereby becoming
exercisable at that time and an additional 25% of the option shares
becoming exercisable on each successive anniversary date, with all option
shares exercisable on the fourth anniversary date. Under the terms of the
Company's stock option plans, this exercise may be accelerated in certain
specific situations.
(B) Under the terms of the Company's stock option plans, there are no
provisions that permit these options to be repriced other than to reflect
stock splits, stock dividends, or similar events.
(C) The options granted to Mr. Meteny in fiscal year 1999 expired upon his
resignation as an officer of the Company on August 19, 1999.
9
The following table sets forth information concerning the stock option
exercises by the named officers during the fiscal year 1999 and the
unexercised stock options held at June 30, 1999 by the named officers.
Aggregated Option Exercises in Last Fiscal Year FY-End Option Values
Value of
Number of Unexercised
Unexercised In-the-Money
Options at Options at
FY--End (#) FY--End ($)
Value -------------- ----------------
Shares Acquired Realized Exercisable/ Exercisable (2)/
Name on Exercise (#) ($) (1) Unexercisable Unexercisable
- ---- --------------- -------- -------------- ----------------
Dennis S. Meteny -- -- 56,155/38,325 361,216/75,141
Craig B. Reynolds 11,998 68,959 238,473/48,100 1,204,900/53,757
Robert D. Crouch -- -- 147,325/23,575 1,302,720/53,757
John C. Miclot -- -- 81,526/33,100 320,773/53,757
Robert E. Tucker 53,584 499,917 103,867/25,800 476,656/32,076
- --------
(1) Represents the amount by which the fair market value of the shares
acquired on exercise at the exercise date exceeded the exercise price of
such shares.
(2) Represents the amount by which the fair market value ($15.13) of the
shares covered by the stock options on June 30, 1999 exceeded the
exercise price of such options.
Employment Agreements and Other Transactions
Effective December 1, 1994 the Company entered into an Employment Agreement
with Mr. Meteny providing for his employment as President and Chief Executive
Officer of the Company for a three year term ending November 30, 1997.
Effective the same date the Company and Mr. Crouch entered into an Employment
Agreement providing for his employment as Vice President of Sales and
Marketing (now Vice President--New Ventures and Corporate Services) also for a
three year term ending November 30, 1997. Each agreement is automatically
extended each year for one additional year absent prior notice by either
party. The Agreements provide for base salaries for Messrs. Meteny and Crouch
of $195,600 per year (subject to annual adjustment) and $138,200 per year
(subject to annual adjustment), respectively, plus participation in the
Company's benefit and incentive plans on a basis comparable with other
executives in the Company.
Effective November 11, 1997, the Company entered into Employment Agreements
with Messrs. Reynolds, Miclot and Tucker providing for their employment as
Senior Vice President (now Executive Vice President and Chief Operating
Officer), Group Vice President--Sleep Disorders (now Senior Vice President and
President, Homecare Division) and Group Vice President--Respiratory (now Vice
President, New Products) respectively, for three year terms ending February
11, 2001. The Agreements are automatically extended each year for an
additional year absent prior notice by either party. The Agreements provide
for base salaries of $251,538 for Mr. Reynolds and $203,679 for Messrs. Miclot
and Tucker (subject to annual adjustment) plus participation in the Company's
benefit and incentive plans on a basis comparable with other executives in the
Company.
Executive Officers
The executive officers of the Company, other than those who also serve as
directors and are described in the preceding pages, are Daniel J. Bevevino,
39, Vice President and Chief Financial Officer; Robert D. Crouch, 51, Senior
Vice President--New Ventures and Corporate Services; Steven P. Fulton, 40,
Vice President--General Counsel; Susan A. Lloyd, 50, Vice President--Asthma
and Allergy Division; John L. Miclot, 40, Senior Vice President and
President--Homecare Division; Robert E. Tucker, 50, Vice President--New
Products; Geoffrey Waters, 49, Vice President--International; and Paul L.
Woodring, 59, Vice President--Hospital Division.
10
Mr. Bevevino joined the Company in 1988 as Manager of Cost Accounting. From
1990 to 1994 Mr. Bevevino served as Controller. In November of 1994, Mr.
Bevevino was elected Chief Financial Officer and in May 1996 was also elected
Vice President. Prior to his affiliation with the Company, Mr. Bevevino--a
Certified Public Accountant--spent five years with Ernst & Young.
Mr. Crouch joined the Company as Director of Sales and Marketing in January
1989. From 1989 to 1997, he was Vice President Sales and Marketing. He was
promoted to Senior Vice President Sales and Marketing in May 1997. In August
1998, Mr. Crouch accepted the position of Senior Vice President--New Ventures.
In July 1999, Mr. Crouch also assumed responsibility for Corporate Services,
including Legal, Human Resources and Information Systems. Prior to joining the
Company from 1986 to 1989, Mr. Crouch worked as a consultant for various
companies on administrative and governmental affairs issues. From 1985 to
1986, he was employed by Cryogenic Associates, serving as Executive Vice
President and later President. From 1983 to 1985, Mr. Crouch was President,
Chief Executive Officer and Chairman of the Board of BetaMed Pharmaceuticals.
Mr. Fulton joined the Company on a part time basis in May 1995 serving as
General Counsel. In January 1996 his role was expanded to full time status. On
October 8, 1996, Mr. Fulton was elected Vice President, Human Resources. In
February 1998, Mr. Fulton was appointed to the position of Vice President--
General Counsel. Prior to joining the Company, Mr. Fulton was a partner in the
Pittsburgh office of Reed Smith Shaw & McClay. He joined the law firm in May
1984. Prior to this employment, he served briefly in an engineering capacity
for Westinghouse Electric Corporation.
Ms. Lloyd, as part of the Company's merger with Healthdyne, joined
Respironics in February 1998 as Vice President-Sales and Marketing, Asthma and
Allergy. In July 1999, she was named Vice President--Asthma and Allergy
Division. Ms. Lloyd was employed by Becton, Dickinson and Company from 1974
through 1990, serving in a variety of sales and marketing positions, including
most recently as Director of Marketing for the Becton Dickinson Acute Care
Division. In 1990, she joined Healthscan Products, Inc. ("Healthscan") as
Director of Marketing. In 1994, Healthdyne acquired Healthscan and Ms. Lloyd
was named Vice President, Marketing for Healthscan. In 1997, she was named
Vice President, Sales and Marketing for Healthscan, a position she held until
Healthdyne was merged with Respironics.
Mr. Miclot, as part of the Company's merger with Healthdyne, joined the
Company in February 1998 as Group Vice President--Sleep Disorders. In August
1998, in addition to his Group Vice President role he has acquired the added
responsibility of Vice President Sales and Marketing. In July 1999, Mr. Miclot
was named Senior Vice President and President--Homecare Division. From 1995 to
February of 1998, Mr. Miclot had been Senior Vice President Sales and
Marketing for Healthdyne. Prior to that time, he was Vice President of
Marketing for Medex, Inc. which he joined in February 1994. Mr. Miclot
previously held several senior positions in marketing, international
activities and sales with Ohmeda, a Division of British Oxygen Corporation,
which he joined in 1988.
Mr. Tucker, as part of the Company's merger with Healthdyne, joined
Respironics in February 1998 as Group Vice President--Respiratory. In July
1999, Mr. Tucker was named Vice President--New Products. From March 1994 to
February 1998, he had been Senior Vice President of Operations for Healthdyne.
From September 1985 to March 1994, Mr. Tucker was Vice President of Operations
of Healthdyne.
Mr. Waters, as part of the Company's acquisition of LIFECARE International,
Inc., joined Respironics in October 1996, as Vice President Customer
Satisfaction. In February 1998, Mr. Waters was transitioned to the position of
Vice President--International Sales and Marketing. In July 1999, Mr. Waters
was named Vice President--International. Prior to joining the Company, Mr.
Waters was employed in various capacities by LIFECARE International, Inc. from
1984 to 1996. His last position with LIFECARE was President and Chief
Operating Officer.
Mr. Woodring, as part of the Company's merger with Healthdyne, joined
Respironics in February 1998 as Vice President--Operations, Respiratory. In
July 1999, Mr. Woodring was named Vice President--Hospital
11
Division. Mr. Woodring was employed by Puritan-Bennett (now Nellcor Puritan
Bennett, a division of Mallinckrodt, Inc.) from 1976 to 1995, serving in a
variety of engineering and management positions, including most recently as
Vice President--Research and Development. Mr. Woodring formed a new company,
InVentive Technologies, in 1995, and was employed there until joining
Healthdyne in 1996.
REPORT OF THE COMPENSATION COMMITTEE
Introduction
Decisions regarding compensation of the Company's executives generally are
made based on recommendations by the Compensation Committee, which is composed
of three independent outside directors. All decisions of the Compensation
Committee relating to compensation of the Company's executive officers are
reviewed and approved by the full Board. Set forth below is a report submitted
by Dr. Cotter and Messrs. Jones and Lawyer in their capacity as members of the
Board's Compensation Committee addressing the Company's compensation policies
for fiscal year 1999 as they affected executive officers of the Company,
including Mr. Meteny, the President and Chief Executive Officer during fiscal
year 1999, and Messrs. Reynolds, Crouch, Miclot and Tucker, the four executive
officers other than Mr. Meteny who were, for fiscal year 1999, the Company's
most highly compensated executive officers. In February 1999, Messrs.
Dewberry, Hardie and Liken were appointed to the Compensation Committee,
replacing Dr. Cotter and Mr. Jones. Mr. Liken ceased to be a member of the
Compensation Committee when he became Chief Executive Officer in August 1999.
All decisions relating to executive compensation policies for fiscal year 1999
were made prior to February 1999.
Compensation
The Company's executive and key employee compensation program consists of a
base salary component, a component providing the potential for an annual
profit sharing bonus based on overall Company performance as well as
individual performance, and a component providing the opportunity to earn
stock options linking the employee's long-term financial success to that of
the Company's stockholders.
Cash Compensation
Officers are compensated within salary ranges that are generally based on
similar positions in companies of comparable size and complexity to the
Company. Companies are selected based on products marketed, customers and
markets served, geographic distribution, manufacturing locations and
complexity of operations (which involves several factors, with sales revenue
being a major factor) for those companies operating in the respiratory
products market. In addition, the Company participates in compensation surveys
and receives summary compensation survey information from these and other
sources.
The methodology used to determine guidelines for compensation was a matching
of each executive's responsibilities to a comparable position described in the
surveys. Based on this matching, each executive's salary was compared to the
corresponding salary range of comparable executives in the surveys. Then, an
appropriate salary range (e.g., 25th percentile, median, 75th percentile) was
selected based on the comparison of the executive's responsibilities to those
of the comparable position in the surveys. The comparable companies operating
in the respiratory market and other data were then examined for reasonableness
on a position-by-position basis. Salaries were established based on the
performance of the executive given his responsibilities within a specific
position and the relationship of the current salary to the appropriate
percentile for the most comparable position available within the surveys.
The primary level of compensation is based on a combination of years of
experience and performance. An officer's performance is based on how well he
meets objectives set by his supervisor through a Company-wide process of
stating objectives for each associate (employee), insuring compatibility of
objectives among associates, reviewing performance against objectives and
recognizing the accomplishment of these objectives.
12
The Board of Directors establishes and reviews the objectives of the Chairman
of the Board, and the Board also assesses the Chairman's performance compared
to these objectives. The salary of all officers is reviewed annually in
November, with the amount of the increases (which take effect the following
February) based on factors such as Company performance, general economic
conditions, marketplace compensation trends and individual performance. The
relative weight of each of these factors in determining salary increases
varies for each annual salary determination. There is no fixed weighting.
However, in the past, the factors which have generally had the greatest
influence on salary increases have been (in decreasing significance) Company
performance, individual performance, marketplace trends in compensation and
general economic conditions.
Profit Sharing and Other Bonuses
The second compensation component is a Company-wide profit sharing program
under the Company's Profit Sharing Bonus Plan. Bonuses are primarily based on
the Company's annual financial performance and secondarily on the performance
of the individual. Bonuses under this program generally range from zero to 50%
of base salary. The measures of annual financial performance used in
determining the amount of bonuses include sales growth, earnings growth and
achievement of net income targets. Based on these factors, no profit sharing
bonuses were accrued for fiscal year 1999 for the named officers or any other
employees of the Company.
In addition, from time to time, special bonuses may be awarded to employees
based on individual effort and performance on specific projects or tasks.
During fiscal year 1999, special bonuses were paid to a variety of employees
including certain of the named executive officers. The amounts of the special
bonuses paid to named executive officers are shown in the Summary Compensation
Table in the Bonus column.
Stock Options
The third major component of the officer's compensation consists of stock
options. The primary purpose of granting stock options is to link the
officers' financial success to that of the stockholders of the Company. The
exercise price of stock options is determined by the Compensation Committee at
the time the option is granted, but may not be less than the fair market value
of the Company's Common Stock as of the date of grant. Options become
exercisable commencing a minimum of six months from the date of grant and are
exercisable for a maximum period of 10 years, as determined by the
Compensation Committee.
The Compensation Committee awarded stock options to 280 of the Company's
employees during fiscal year 1999. Stock options granted to named officers
during fiscal year 1999 are listed on the table entitled "Option Grants in
Last Fiscal Year."
CEO Compensation
The following factors constitute the basis for the compensation paid to Mr.
Meteny, the Company's Chief Executive Officer ("CEO") during fiscal year 1999;
his responsibilities as the Company's CEO, the Company's ability to achieve
its objectives for revenue and earnings growth and its objectives for long-
term growth; the salaries paid to other CEO's of comparable companies as
reported in the industry surveys; and Mr. Meteny's experience compared to the
CEO's of comparable companies in the industry surveys. In fiscal year 1999 the
Compensation Committee recommended and the Board approved a base salary
increase for Mr. Meteny of 11% considering the foregoing factors. Mr. Meteny
was awarded no profit sharing bonus for fiscal year 1999.
Compensation Committee of the Company's Board of Directors:
Douglas A. Cotter, Chairman
Donald H. Jones
Joseph C. Lawyer
13
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Securities and Exchange Commission's rules relating to the disclosure of
executive compensation require that the Proxy Statement include certain
information about "insider" participation on compensation committees and about
specific kinds of "interlocking" relationships between the compensation
committees of different companies, under the foregoing caption. All members of
the Compensation Committee are outside directors, and no such interlocking
relationships exist.
The Compensation Committee of the Board of Directors is responsible for
executive compensation decisions as described above under "Board of Directors
and Committees of the Board." During fiscal year 1999, the Committee consisted
of Dr. Cotter (Chairman) and Messrs. Jones and Lawyer for the period July 1998
through February 1999 and Messrs. Lawyer (Chairman), Dewberry, Hardie and
Liken for the period February 1999 through June 1999. Mr. Parker H. Petit
served on the Committee from July 1998 until his resignation from the Board in
August 1998.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and officers, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file with the
Securities and Exchange Commission (the "Commission") and the National
Association of Securities Dealers National Market System initial reports of
ownership and reports of change in ownership of Common Stock and other equity
securities of the Company. Officers, directors and greater than ten percent
shareholders are required by Commission regulation to furnish the Company with
copies of all Section 16(a) forms they file.
All Forms 3, 4, and 5 have been filed within the guidelines of Commission
during fiscal year 1999. In making this disclosure, the Company has relied
solely on the written representation of its directors and officers and copies
of the reports that they have filed with the Commission.
14
PERFORMANCE GRAPH
The following graph shows a five year comparison of cumulative total returns
for the Company, the NASDAQ Market Index, the Standard & Poor's Medical
Products and Supplies Index ("Hlthcare-500") and a peer group index ("Peer
Group Index") consisting of ResMed, Inc., Sunrise Medical, Inc., Invacare
Corp., and Mallinckrodt, Inc. The Company has adopted this Peer Group Index,
which consists of the Company's major competitors that are publicly-held,
because it believes that the Peer Group Index is more meaningful for
comparative purposes than the Hlthcare-500, which includes companies with
business and product lines dissimilar to that of the Company and its
competitors. The graph assumes that the value of the investment in the
Company's Common Stock and each index was $100 at June 30, 1994, and that all
dividends were reinvested.
[Performance Graph Appears Here]
Fiscal Year Ended June 30
------------------------------------------
1994 1995 1996 1997 1998 1999
------- ------ ------ ------ ------ ------
NASDAQ............................... $100.00 133.48 171.38 208.43 274.43 392.16
Hlthcare-500......................... $100.00 153.42 201.56 267.10 357.29 425.00
Peer Group Index..................... $100.00 119.76 125.48 124.32 113.46 131.29
Respironics, Inc..................... $100.00 168.88 219.25 250.36 184.43 179.25
MISCELLANEOUS
The cost of soliciting proxies will be borne by the Company. Following the
original mailing of the proxy solicitation material, proxies may be solicited
personally, or by telephone, facsimile or other electronic means, by employees
of the Company and its subsidiaries who will receive no additional compensation
for such services. The Company will reimburse brokerage houses and other
custodians, nominees and fiduciaries for reasonable expenses incurred in the
sending of proxy solicitation material and the 1999 Annual Report on Form 10-K
to beneficial owners of stock held in their names.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR FISCAL YEAR 1999 IS
INCLUDED IN THIS MAILING WITH THE PROXY STATEMENT. ADDITIONAL COPIES MAY BE
OBTAINED WITHOUT CHARGE BY ANY SHAREHOLDER UPON WRITTEN REQUEST TO DORITA A.
PISHKO, CORPORATE SECRETARY, RESPIRONICS, INC., 1501 ARDMORE BOULEVARD,
PITTSBURGH, PA 15221-4401.
Dorita A. Pishko
Corporate Secretary
October 25, 1999
15
RESPIRONICS, INC.
1501 Ardmore Boulevard
Pittsburgh, PA 15221
Annual Meeting of Shareholders, November 18, 1999
Gerald E. McGinnis, James W. Liken and Dorita A. Pishko, or any of them,
are hereby appointed proxies with full power of substitution, to vote the shares
of the shareholder(s) named on the reverse side hereof at the Annual Meeting of
Shareholders of Respironics, Inc. to be held at Two Mellon Bank Center in the
Auditorium on the Tenth Floor, at 501 Grant Street, Pittsburgh, Pennsylvania, on
November 18, 1999, and at any adjournment thereof, as directed hereon, and in
their discretion to vote and act upon any other matters as may properly come
before this meeting.
(Continued on reverse side)
/\ FOLD AND DETACH HERE /\
Unless you attend and vote in person, you MUST sign and return your proxy in
order to have your shares voted at the meeting.
Please mark
your votes as
indicated in X
this example
1. Election of Directors.
NOMINEES: Daniel P. Barry, J. Terry Dewberry, Donald H. Jones and James W.
Liken to the class of 2002, Candace L. Littell to the class of 2001 and J.
Paul Yokubinas to the class of 2000.
FOR all nominees WITHHOLD AUTHORITY
(listed above except to vote for all
as marked to the nominees listed above
contrary)
[ ] [ ]
FOR AGAINST ABSTAIN
2. To ratify the selection of Ernst & Young LLP as [ ] [ ] [ ]
independent public accountants for the fiscal year
ending June 30, 2000.
(Instruction: To withhold authority to vote for any nominee, write that
nominee's name in the space provided below.)
- ----------------------------------------------------------------------
____________ This proxy is solicited on behalf of the Board of Directors and
will be voted as specified. A vote FOR the election of nominees
listed includes discretionary authority to vote for a substitute
if any nominee is unable to serve or for good cause will not
serve.
Date: , 1999
----------------------------------------------------
---------------------------------------------------------------
---------------------------------------------------------------
Shareholder(s) signature should correspond to the name(s) shown
hereon. (Executors, Administrators, Trustees, etc. should so
indicate when signing.)
PLEASE SIGN, DATE AND MAIL YOUR PROXY TODAY!
/\ FOLD AND DETACH HERE /\