SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) [ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1999 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____to___Commission File Number:1-8089 ------ DANAHER CORPORATION (Exact name of registrant as specified in its charter) <TABLE> <S> <C> Delaware 59-1995548 -------- ---------- (State of incorporation) (I.R.S.Employer Identification number) 1250 24th Street, N.W., Suite 800 Washington, D.C. 20037 ---------------- ----- (Address of Principal (Zip Code) Executive Offices) </TABLE> Registrant's telephone number, including area code: 202-828-0850 Securities Registered Pursuant to Section 12(b) of the Act: <TABLE> <S> <C> Name of Exchanges Title of each class on which registered - ------------------- ------------------- Common Stock $.01 par Value New York Stock Exchange, Inc. Pacific Stock Exchange, Inc. </TABLE> Securities registered pursuant to Section 12(g) of the Act: NONE (Title of Class) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filing requirements for the past 90 days. Yes X No --- --- Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] As of March 17, 2000, the number of shares of common stock outstanding was 141.3 million and were held by approximately 3,500 holders. The aggregate market value of common shares held by non-affiliates of the Registrant on such date was approximately $4.1 billion, based upon the closing price of the Company's common shares as quoted on the New York Stock Exchange composite tape on such date. 1
EXHIBIT INDEX APPEARS ON PAGE 14 2
DOCUMENTS INCORPORATED BY REFERENCE Part II and Part IV incorporate certain information by reference from the registrant's Annual Report to Shareholders for the year ended December 31, 1999. With the exception of the pages of the Annual Report to Shareholders specifically incorporated herein by reference, the Annual Report to Shareholders is not deemed to be filed as part of this Form 10-K. Part III incorporates certain information by reference from the registrant's proxy statement for its 2000 annual meeting of stockholders. With the exception of the pages of the 2000 Proxy Statement specifically incorporated herein by reference, the 2000 Proxy Statement is not deemed to be filed as part of this Form 10-K. Certain information included or incorporated by reference in this document may be deemed to be "forward looking statements" within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. All statements, other than statements of historical facts, that address activities, events or developments that the Company intends, expects, projects, believes or anticipates will or may occur in the future are forward looking statements. Such statements are characterized by terminology such as "believe," "anticipate," "should," "intend," "plan," "will," "expects," "estimates," "projects," "positioned," "strategy," and similar expressions. These statements are based on assumptions and assessments made by the Company management in light of its experience and its perception of historical trends, current conditions, expected future developments and other factors it believes to be appropriate. These forward looking statements are subject to a number of risks and uncertainties, including but not limited to continuation of the Company's longstanding relationship with major customers, the Company's ability to integrate acquired businesses into its operations and realize planned synergies, the extent to which acquired businesses are able to meet the Company's expectations and operate profitably, changes in regulations (particularly environmental regulations) which could affect demand for products in the Process/Environmental Controls segment and unanticipated developments that could occur with respect to contingencies such as environmental matters and litigation. In addition, the Company is subject to risks and uncertainties that affect the manufacturing sector generally including, but not limited to, economic, competitive, governmental and technological factors affecting the Company's operations, markets, products, services and prices. Any such forward looking statements are not guarantees of future performances and actual results, developments and business decisions may differ from those 3
envisaged by such forward looking statements. The Company disclaims any duty to update any forward looking statements, all of which are expressly qualified by the foregoing. ITEM 1. BUSINESS - ----------------- The Company conducts its operations through two business segments: Process/Environmental Controls and Tools and Components. Process/Environmental Controls - ------------------------------ The Process/Environmental Controls segment is comprised of Hach Company, Fluke Corporation ("Fluke"), Veeder-Root Company ("Veeder-Root"), Danaher Controls, Partlow/West, Anderson Instruments, West Instruments, QualiTROL Corporation, A.L. Hyde Company, Hengstler, McCrometer, the controls product line business units of Joslyn Corporation and Pacific Scientific Company, Namco Controls, Dolan-Jenner, Atlas Copco Controls, M&M Precision Systems, Communications Technology Corporation, Gems Sensors and the Dr. Bruno Lange Group. These companies produce and sell compact, professional electronic test tools, underground storage tank leak detection systems and motion, position, speed, temperature, level and position instruments and sensing devices, power switches and controls, communication line products, power protection products, liquid flow and quality measuring devices, quality assurance products and systems, safety devices and electronic and mechanical counting and controlling devices. These products are distributed by the Company's sales personnel and independent representatives to original equipment manufacturers, distributors and other end users. The Company's strategy in the Process/Environmental Controls segment is to concentrate on the rapid expansion of its key strategic product lines, including environmental, electronic test and measurement, motion and others. One key product in the environmental controls product line is the Veeder-Root storage tank leak detection system. The Company believes that Veeder-Root is the premier manufacturer of state-of-the-art tank measuring and leak detection systems for underground fuel storage tanks. Veeder-Root continues to expand its environmental controls product and service offering to encompass applications related to markets other than petroleum storage and to address nonregulatory business requirements. The Company has a leadership position in the water quality testing and control market, into which is sold its Hach, Dr. Lange, Pacific Scientific, and Sigma branded products. These products include analytical instruments used in water quality 4
monitoring, and chemicals and other consumables used in the process. The Company markets these products worldwide, both direct to end users and through distributors. Fluke is engaged in the design, manufacture and marketing of compact, professional electronic test tools. Fluke's principal products are portable instruments that measure voltage, current, power quality, frequency, temperature, pressure and other key functional parameters of electronic equipment. Fluke distributes its products in over 100 countries, serving two major markets: industrial tools and networks. In its instruments product line, the Company's strategy is to continue enhancing its global controls and instrument position by both new product development and complementary acquisitions. Danaher's instrument companies have significant synergies in both product offerings and channels of distribution. The Company's plan is to leverage these synergies in product design, engineering and manufacturing, and product marketing. M&M Precision Systems provides both quality assurance products and systems which enhance both quality and manufacturing effectiveness as well as motion products which are generally components of other devices. Pacific Scientific has two major product lines, motion and safety equipment. Nearly half of Pacific Scientific's sales consists of electric motors, drives and controls. The Company also manufactures and sells electronic drives as part of its Atlas Copco Controls division. These electric motors and controls are sold primarily to original equipment manufacturers who incorporate them into a wide variety of products. Pacific Scientific motors are used in factory automation, medical, printing, plastic extrusion and molding, paper converting, vending, textile, aerospace, fitness and many other types of equipment. Safety equipment includes mainly fire detection and suppression equipment, crew restraints, flight control and pyrotechnic devices. Safety equipment is sold mainly in the aviation and aerospace industry. The Company also provides worldwide sales, service and repair of its products for airlines and other users of safety equipment. Other business lines within this segment include extruded thermoplastic mill shapes and custom molded plastic products. The raw materials utilized by companies in this segment are stock items, principally metals and plastic, electrical and electronic components. These materials are readily available from a number of sources in sufficient quantities. 5
Tools and Components - -------------------- The Tools and Components segment is comprised of the Danaher Hand Tool Group (including Special Markets, Professional Tool Division and Asian Tool Division), Matco Tools ("Matco"), Jacobs Chuck Manufacturing Company ("Jacobs"), Delta Consolidated Industries ("Delta"), Jacobs Vehicle Systems Company, Hennessy Industries and the hardware and electrical apparatus lines of Joslyn Manufacturing Company (JMC). This segment is one of the largest worldwide producers and distributors of general purpose mechanics' hand tools and automotive specialty tools. Other products manufactured by these companies include tool boxes and storage devices, diesel engine retarders, wheel service equipment, drill chucks, custom designed headed tools and components, hardware and components for the power generation and transmission industries, high quality precision socket screws, fasteners, and high quality miniature precision parts. The Company's business strategy in this segment is focused on increasing sales to existing customers, broadening channels of distribution, developing new products, geographic expansion and achieving production efficiencies and enhanced quality and customer service. Danaher Tool Group (DTG) is one of the largest worldwide producers of general purpose mechanics' hand tools (primarily ratchets, sockets and wrenches) and specialized automotive service tools for the professional and "do-it- yourself" markets. DTG has been the principal manufacturer of Sears, Roebuck and Co.'s Craftsman/(R)/ line of mechanics' hand tools for over 60 years. Approximately 80% of the over 200 million pieces sold to Sears annually are sold in tool sets that include from three to over 1,000 pieces. DTG's Special Markets Group sells to Sears under a five year evergreen agreement, that requires Sears to purchase a significant portion of its annual requirements for its private-label Craftsman mechanics' hand tool line from DTG, subject to certain conditions. For over 30 years, DTG has also been a primary supplier of specialized automotive service tools to NAPA, which has approximately 6,100 outlets. In addition, DTG has been the designated supplier of general purpose mechanics' hand tools to NAPA since 1983. DTG specialized automotive service tools are also sold under the K-D Tools/(R)/ brand, its industrial tools and products are also sold under the Armstrong/(R)/ and Allen brand names, and fastener products under the Holo-Krome/(R)/ name are sold to independent distributors and other customers in the "do-it-yourself," professional automotive, commercial and industrial markets. 6
Professional mechanics' tools are distributed by Matco which has approximately 1,300 independent mobile distributors who sell primarily to individual professional mechanics. Matco is one of the leading suppliers in this market. Jacobs/(R)/ is the market leader in the drill chuck business with its highly respected and well recognized brand name. Delta is a leading manufacturer of pickup truck toolboxes and industrial storage boxes and its products are sold under the DELTA/(R)/ and JOBOX/(R)/ brand names. Wheel service equipment is manufactured under the Coats/(R)/, Bada/(R)/ and Ammco/(R)/ brand names. Products include tire changers, wheel balancers, wheel weights and brake service equipment. Wheel service equipment is sold primarily to wholesale distributors and national accounts. These markets are served by the Company's sales personnel. Diesel engine retarders are manufactured at Jacobs Vehicle Systems Company. The "Jake Brake/(R)/" technology was developed by Jacobs Vehicle and represents the leading brand of engine retarders. The product is sold by Jacobs' sales personnel to original equipment manufacturers and aftermarket distributors. JMC manufactures a wide variety of products used in the construction and maintenance of electric power, telephone and cable television systems. Its products range from specialized fasteners to sophisticated castings and forgings. JMC also manufactures surge protection devices for the electric power utility industry. The major raw materials used by this segment, including high quality steel, are available from a variety of sources in sufficient quantities. Patents, Licenses, etc. - ----------------------- The Company has patents of its own and has acquired licenses under patents of others. The Company does not consider that its business, as a whole, is dependent on any single patent, group of patents, trademark or franchise. The Company does, however, offer many patented products and is periodically engaged in litigation concerning patents and licenses. 7
Seasonal Nature of Business - --------------------------- As a whole, the Company's businesses are not subject to material seasonal fluctuations. Backlog - ------- The Company's products are manufactured primarily in advance of order and either shipped or assembled from stock. Backlogs are not significant as sales are often dependent on orders requiring immediate shipment from inventory. Employee Relations - ------------------ At December 31, 1999, the Company employed approximately 19,000 persons. Of these, approximately 2,300 were hourly-rated unionized employees. The Company considers its labor relations to be good. Research and Development - ------------------------ The Company's research and development expenditures were $119 million for 1999, $121 million for 1998 and $96 million for 1997. Environmental and Safety Regulations - ------------------------------------ Certain of the Company's operations are subject to federal, state and local environmental laws and regulations which impose limitations on the discharge of pollutants into the air and water and establish standards for treatment, storage and disposal of solid and hazardous wastes. The Company believes that it is in substantial compliance with applicable environmental laws and regulations. JMC previously operated wood treating facilities that chemically preserved utility poles, pilings and railroad ties. All such treating operations were discontinued or sold prior to 1982. These facilities used wood preservatives that included creosote, pentachlorophenol and chromium-arsenic-copper. While preservatives were handled in accordance with then existing law, environmental law now imposes retroactive liability, in some circumstances, on persons who owned or operated wood-treating sites. JMC is remediating some of its former sites and will remediate other sites in the future. The Company has made a provision for environmental remediation; however, there can be no assurance that estimates of environmental liabilities will not change. 8
In addition to environmental compliance costs, the Company may incur costs related to alleged environmental damage associated with past or current waste disposal practices or other hazardous materials handling practices. For example, generators of hazardous substances found in disposal sites at which environmental problems are alleged to exist, as well as the owners of those sites and certain other classes of persons, are subject to claims brought by state and federal regulatory agencies pursuant to statutory authority. The Company believes that its liability, if any, for past or current waste handling practices will not have a material adverse effect on its results of operation, financial condition and cash flow. The Company must also comply with various federal, state and local safety regulations in connection with its operations. The Company's compliance with these regulations has had no material adverse effect on its financial condition. Major Customers - --------------- The Company has no customers which accounted for more than 10% of consolidated sales in 1999. The Company's largest single customer is Sears, Roebuck and Co. ("Sears"), and although the relationship with Sears is long- standing, the Company believes the loss or material reduction of this business could have a material adverse effect on its operations. ITEM 2. PROPERTIES - ------------------- The Company occupies over 6 million square feet of manufacturing, distribution, service and office space at various domestic and foreign locations. The principal properties are listed below. The Company believes that its plants have adequate productive capacity and are suitably used for the manufacture of its products and that its warehouses, distribution centers and sales offices are suitably located and utilized for the marketing of its products and services. <TABLE> <CAPTION> Location Principal Use Owned/Leased - -------- ------------- ------------ Process/Environmental Controls - -------------------------------- <S> <C> <C> Altoona, PA Manufacturing Owned Elizabethtown, NC Manufacturing Owned </TABLE> 9
<TABLE> <CAPTION> Location Principal Use Owned/Leased - -------- ------------- ------------ Process/Environmental Controls - -------------------------------- <S> <C> <C> Market Harborough, England Manufacturing Leased Sao Paulo, Brazil Manufacturing Owned New Hartford & Fairport, NY Manufacturing Owned Gurnee, IL Manufacturing Leased Grenloch, NJ Manufacturing Owned Brighton, England Manufacturing Leased Aldingen, Germany Manufacturing Owned Aldingen, Germany (2) Manufacturing Leased Wehingen, Germany (2) Manufacturing Leased Eatontown, NJ Distribution Leased Broxbourne, England Distribution Leased Cleveland, OH (3) Manufacturing Owned Goleta, CA Manufacturing Owned Birmingham, England Manufacturing Leased Juarez, Mexico Manufacturing Leased Lachine, Quebec Manufacturing Leased Lancaster, SC Manufacturing Owned Paso Robles, CA Manufacturing Leased San Jose, CA Manufacturing Owned Hemet, CA Manufacturing Owned Etobicoke, Canada Manufacturing Leased Highland Heights, OH Manufacturing Owned Herzhorn, Germany Manufacturing Owned West Carollton, OH Manufacturing Owned Loffingen, Germany Manufacturing Owned Tamworth, England Manufacturing Leased Basingstoke, England Manufacturing Owned Baretswil, Switzerland Manufacturing Owned Plainville, CT Manufacturing Owned Everett, WA Manufacturing Owned Einhoven, Netherlands Manufacturing Leased Chandler, AZ Manufacturing Leased Duarte, CA Manufacturing Leased Rockford, IL Manufacturing Leased Grants Pass, OR Manufacturing Owned </TABLE> 10
<TABLE> <CAPTION> Location Principal Use Owned/Leased - -------- ------------- ------------ Process/Environmental Controls - -------------------------------- <S> <C> <C> Wilmington, MA Manufacturing Leased Kazmarek, Slovakia Manufacturing Leased Weymouth, MA Manufacturing Owned Loveland, CO Manufacturing Owned Ames, IA Manufacturing Owned Elkhart, IN Manufacturing Owned Stockholm, Sweden Manufacturing Owned Hertfordshire, England Distribution Owned Enis, Ireland Manufacturing Leased Tools and Components - -------------------------------- Springdale, AK Manufacturing Owned Springfield, MA Manufacturing Owned Gastonia, NC Manufacturing Leased Fayetteville,AK (2) Manufacturing Owned Baltimore, MD Distribution Leased Brampton, Ontario Distribution Leased Lakewood, NY Manufacturing Owned Nashville, TN Distribution Owned Stow, OH Distribution Owned West Hartford, CT Manufacturing Owned Terryville, CT Manufacturing Owned Walworth, WI Manufacturing Owned Dundee, Scotland Manufacturing Owned Sheffield, England Manufacturing Owned Clemson, SC Manufacturing Owned Jonesboro, AK Manufacturing Owned Raleigh, NC Manufacturing Leased Chicago, IL (3) Manufacturing Owned Bloomfield, CT Manufacturing Owned LaVergne, TN Manufacturing Owned Bowling Green, KY Manufacturing Owned Suzhou, China Manufacturing Owned Shanghai, China (3) Manufacturing Owned Taichung, Taiwan Manufacturing Leased Dallas, TX Manufacturing Leased Atlanta, GA Manufacturing Owned Mexico City, Mexico Manufacturing Leased </TABLE> In addition to the facilities listed, the Company owns or leases various facilities including offices or properties in Washington, District of Columbia; Simsbury, Connecticut; as well as facilities in Uppermill, Livingston, Gloucester and Richmond, Great Britain; Melbourne and Sydney, Australia; Nagoya, Osaka and Tokyo, Japan; Toronto, Canada; Paris, Bron, Toulouse, Lyon, Bordeaux, Tours and Selestat, France; and Stuttgart, Germany. 11
ITEM 3. LEGAL PROCEEDINGS - -------------------------- A former subsidiary of the Company is engaged in litigation in several states with respect to product liability. The Company sold the subsidiary in 1987. Under the terms of the sale agreement, the Company agreed to indemnify the buyer of the subsidiary for product liability related to tools manufactured by the subsidiary prior to June 4, 1987. The cases involve approximately 3,000 plaintiffs, in state and federal courts. All other major U.S. air tool manufacturers are also defendants. The gravamen of these complaints is that the defendants' air tools, when used in different types of manufacturing environments over extended periods of time, were defective in design and caused various physical injuries. The plaintiffs seek compensatory and punitive damages. The Company has accepted an agreement in principle to settle these claims. Completion of this settlement agreement will not result in a material adverse effect on the Company's results of operations or financial condition. In addition to the litigation noted above, the Company and its subsidiaries are from time to time subject to ordinary routine litigation incidental to their business. The Company believes that the results of the above noted litigation and other pending legal proceedings would not have a materially adverse effect on the Company's financial condition. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDER - ----------------------------------------------------------- No matters were submitted to a vote of security holders during the fourth quarter of 1999. PART II ITEMS 5 THROUGH 8. - ------------------ The information required under Items 5 through 8 is included in the Registrant's Annual Report to its Shareholders for the year ended December 31, 1999, and is incorporated herein by reference. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND - ------------------------------------------------------------------------ FINANCIAL DISCLOSURE - -------------------- NONE 12
PART III ITEMS 10 THROUGH 13. - ------------------- The information required under Items 10 through 13 is included in the Registrant's Proxy Statement for its 2000 annual meeting, and is incorporated herein by reference. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM ---------------------------------------------------------------------- 8-K - --- a) Document List 1. Financial Statements Response to this portion of Item 14 is submitted per the Index to Financial Statement Schedules on page 13 of this report. 2. Supplementary Data and Financial Statement Schedules Response to this portion of Item 14 is submitted per the Index to Financial Statement Schedules on page 13 of this report. 3. An Index of Exhibits is on page 14 of this report. b) Reports on Form 8-K filed in the fourth quarter of 1999. NONE 13
DANAHER CORPORATION INDEX TO FINANCIAL STATEMENTS, SUPPLEMENTARY DATA AND FINANCIAL STATEMENT SCHEDULES <TABLE> <CAPTION> Page Number in: --------------- Annual Report ------------- Form 10K To Shareholders -------- --------------- Annual Report: - -------------- <S> <C> Report of Independent Public Accountants on Schedule 17 Financial Statements: - --------------------- Consolidated Statements of Earnings, year ended December 31, 1999, 1998, and 1997 18 Consolidated Balance Sheets, December 31, 1999 and 1998 19 Consolidated Statements of Cash Flows, years ended December 31, 1999, 1998, and 1997 20 Consolidated Statements of Stockholders' Equity, years ended December 31, 1999, 1998, and 1997 21 Notes to Consolidated Financial Statements 22 Supplemental Data: - ------------------ Selected Financial Data 12 Market Prices of Common Stock 31 Schedules: - ---------- II - Valuation and Qualifying Accounts 18 </TABLE> Schedules other than those listed above have been omitted from this Annual Report because they are not required, are not applicable or the required information is included in the financial statements or the notes thereto. 14
Exhibits: - --------- <TABLE> <S> <C> (3) Articles of Incorporation and By-Laws (a) The Articles of Incorporation of Danaher Incorporated by Reference to Exh 3 of 6/26/98 Form 10-Q (b) The By-Laws of Danaher Incorporated by Reference to Exh 3 of 6/26/98 Form 10-Q (10) Material Contracts: (a) Employment Agreement between Danaher Incorporated by Corporation and George M. Sherman Reference to Exh 10(a) dated as of January 2, 1990 of 6/26/98 Form 10-Q (b) Credit Agreement Dated As of September 7, Incorporated by 1990. Among Danaher Corporation, the Reference to Exh 10(b) Financial Institutions Listed Therein of 6/26/98 10-Q and Bankers Trust Company as Agent (c) Agreement as of November 1, 1990 between Incorporated by Danaher Corporation, Easco Hand Tools, Inc. Reference to Exh 10(c) and Sears, Roebuck and Co. of 6/26/98 Form 10-Q (d) Note Agreement as of November 1, 1992 Incorporated by Between Danaher Corporation and Lenders Reference to Exh 10(d) Referenced Therein of 6/26/98 Form 10-Q (e) Note Agreement as of April 1, 1993 Incorporated by Between Danaher Corporation and Lenders Reference to Exh 10(d) Referenced Therein Of 6/26/98 Form 10-Q (f) Danaher Corporation 1998 Stock Option Plan Incorporated by Reference to Exh A of Proxy statement dated March 30, 1998 (g) Indenture Agreement as of October 28, 1998 Incorporated by Between Danaher Corporation and The First Reference to Form S-3 National Bank of Chicago, as Trustee (File 333-63591) (13) Annual Report to Securityholders (21) Subsidiaries of Registrant (23) Consent of Independent Public Accountants (27) Financial Data Schedules </TABLE> 15
SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. DANAHER CORPORATION By: /s/ GEORGE M. SHERMAN ------------------------- George M. Sherman President and Chief Executive Officer Date: March 17, 2000 <TABLE> <S> <C> /s/ GEORGE M. SHERMAN President and Chief Executive Officer - ------------------------------- George M. Sherman /s/ STEVEN M. RALES Chairman of the Board - ------------------------------- Steven M. Rales /s/ MITCHELL P. RALES Chairman of the Executive Committee - ------------------------------- Mitchell P. Rales /s/ WALTER G. LOHR, JR. Director - ------------------------------- Walter G. Lohr, Jr. /s/ DONALD J. EHRLICH Director - ------------------------------- Donald J. Ehrlich /s/ MORTIMER M. CAPLIN Director - ------------------------------- Mortimer M. Caplin /s/ ALAN G. SPOON Director - ------------------------------- Alan G. Spoon /s/ A. EMMET STEPHENSON, JR. Director - ------------------------------- A. Emmet Stephenson, Jr. /s/ PATRICK W. ALLENDER Executive Vice President-Chief Financial - ------------------------------- Patrick W. Allender Officer and Secretary /s/ CHRISTOPHER C. MCMAHON Vice President and Controller - ------------------------------- Christopher C. McMahon </TABLE> 16
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ON THE FINANCIAL STATEMENT SCHEDULES To Danaher Corporation: We have audited in accordance with generally accepted auditing standards, the consolidated financial statements included in the Danaher Corporation and Subsidiaries' Annual Report to Shareholders incorporated by reference in this Form 10-K, and have issued our report thereon dated January 27, 2000. Our audit was made for the purpose of forming an opinion on those statements taken as a whole. The schedules listed in the index are the responsibility of the Company's management and are presented for the purpose of complying with the Securities and Exchange Commission's rules and are not a part of the consolidated financial statements. These schedules have been subjected to the auditing procedures applied in the audit of the consolidated financial statements and, in our opinion, fairly state in all material respects the financial data required to be set forth therein in relation to the consolidated financial statements taken as a whole. /s/ ARTHUR ANDERSEN LLP Baltimore, Maryland January 27, 2000 17
DANAHER CORPORATION AND SUBSIDIARIES SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (000's omitted) <TABLE> <CAPTION> Additions Write Balance Charged Offs, Classification at to Charged Write Balance Beginning Costs to Downs at End of & other & of Period Expenses Accounts Deductions Period - --------------------------------------------------------------------- <S> <C> <C> <C> <C> <C> Year Ended December 31, 1999 Allowances deducted from asset accounts: Allowance for doubtful accounts: $24,000 $10,756 $ 185(a) $ 6,941 $28,000 ======= ======= ====== ======= ======= Year Ended December 31, 1998 Allowances deducted from asset accounts: Allowance for doubtful accounts $19,000 $ 9,442 $ 2,698(a) $ 7,140 $24,000 ======= ======= ======= ======= ======= Year Ended December 31, 1997 Allowances deducted from asset accounts: Allowance for doubtful accounts: $16,000 $ 6,986 $ 510(a) $ 4,496 $19,000 ======= ======= ====== ======= ======= </TABLE> Notes:(a) - Amounts related to businesses acquired, net of amounts related to businesses disposed. 18