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 Pursuant to Rule 14a-11(c) or Rule 14a-12

                               CONMED CORPORATION
 ................................................................................
                (Name of Registrant as Specified in Its Charter)

                                       N/A

 ................................................................................
    (Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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:

               .................................................................





                               CONMED CORPORATION
                                310 BROAD STREET
                              UTICA, NEW YORK 13501


                    NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

         NOTICE IS HEREBY  GIVEN that the  Annual  Meeting  of  Shareholders  of
CONMED  Corporation  (the  "Company")  will  be held at the  Holiday  Inn,  1777
Burrstone  Road, New Hartford,  New York on Tuesday,  May 18, 1999, at 3:30 P.M.
(New York time), for the following purposes:

          (1)  To  elect  six  Directors  to  serve  on the  Company's  Board of
               Directors;

          (2)  To appoint independent accountants for the Company for 1999;

          (3)  To approve the adoption of the Company's 1999 Long-Term Incentive
               Stock Plan;

          (4)  To approve an amendment to the Company's Restated  Certificate of
               Incorporation to increase to 100,000,000 the number of authorized
               shares of Common Stock; and

          (5)  To transact such other business as may properly be brought before
               the meeting or any adjournment thereof.

         The  shareholders  of record at the close of business on March 31, 1999
are entitled to notice of and to vote at the Annual  Meeting or any  adjournment
thereof.

         Even if you plan to attend the meeting in person,  we request  that you
mark, date, sign and return your proxy in the enclosed  self-addressed  envelope
as soon as possible so that your shares may be certain of being  represented and
voted at the meeting.  Any proxy given by a  shareholder  may be revoked by that
shareholder at any time prior to the voting of the proxy.

                                     By Order of the Board of Directors,



                                                      Thomas M. Acey
                                                           Secretary

April 16, 1999






                               CONMED CORPORATION
                                310 BROAD STREET
                              UTICA, NEW YORK 13501

                                 PROXY STATEMENT

                         ANNUAL MEETING OF SHAREHOLDERS
                                  MAY 18, 1999

         The  enclosed  proxy is  solicited  by and on  behalf  of the  Board of
Directors of CONMED Corporation (the "Company") for use at the Annual Meeting of
Shareholders to be held on Tuesday,  May 18, 1999, at 3:30 P.M. (New York time),
at the Holiday  Inn,  1777  Burrstone  Road,  New  Hartford,  New York,  and any
adjournment thereof. The matters to be considered and acted upon at such meeting
are described in the foregoing  notice of the meeting and this proxy  statement.
This proxy statement,  the related form of proxy and the Company's annual report
to shareholders  are being mailed on or about April 16, 1999 to all shareholders
of record on March 31, 1999.  Shares of the Company's  Common  Stock,  par value
$.01 per share (the "Common  Stock"),  represented in person or by proxy will be
voted as hereinafter described or as otherwise specified by the shareholder. Any
proxy given by a shareholder may be revoked by the shareholder at any time prior
to the voting of the proxy by  delivering a written  notice to the  Secretary of
the Company, by executing and delivering a later-dated proxy or by attending the
meeting and voting in person.

         The  persons  named as proxies  are Eugene R.  Corasanti  and Robert E.
Remmell, each of whom is presently a director and an officer of the Company. The
cost of preparing,  assembling and mailing the proxy,  this proxy  statement and
other material  enclosed,  and all clerical and other expenses of solicitations,
will be borne by the Company.  In addition to the solicitation of proxies by use
of the  mails,  directors,  officers  and  employees  of  the  Company  and  its
subsidiaries may solicit proxies by telephone,  telegram or personal  interview.
The Company also will request  brokerage houses and other  custodians,  nominees
and  fiduciaries  to forward  soliciting  material to the  beneficial  owners of
Common Stock held of record by such parties and will  reimburse such parties for
their  expenses in  forwarding  soliciting  material.  The total  amount of such
reimbursement of expenses is anticipated to be approximately $30,000.

         Votes at the 1999 Annual Meeting will be tabulated by a  representative
of Registrar  and Transfer  Company,  which has been  appointed by the Company's
Board of Directors to serve as inspector of election.

                                  VOTING RIGHTS

         The  holders  of  record  of the  15,201,913  shares  of  Common  Stock
outstanding  on March 31,  1999 will be entitled to one vote for each share held
on all matters coming before the meeting. The holders of record of a majority of
the  outstanding  shares  of Common  Stock  present  in person or by proxy  will
constitute a quorum for the transaction of business at the meeting. Shareholders
are not entitled to cumulative voting rights.  Under the rules of the Securities
and  Exchange  Commission  (the "SEC"),  boxes and a designated  blank space are
provided  on the proxy card for  shareholders  if they wish either to abstain on
one or more of the  proposals  or to withhold  authority to vote for one or more
nominees for director.  In accordance with New York State law, such  abstentions
are not counted in  determining  the votes cast at the meeting.  With respect to
Proposal 1, the director  nominees  who receive the greatest  number of votes at
the meeting  will be elected to the Board of  Directors  of the  Company.  Votes
against,  and votes  withheld in respect of, a candidate  have no legal  effect.
Proposals 2 and 3 require the  affirmative  vote of the holders of a majority of
the votes  cast at the  meeting  in order to be  approved  by the  shareholders.
Proposal 4 requires  the  affirmative  vote of the  holders of a majority of the
outstanding shares of Common Stock in order to be approved by the








shareholders.  When properly  executed a proxy will be voted as specified by the
shareholder. If no choice is specified by the shareholder, a proxy will be voted
"for"  all  portions  of items  (1),  (2),  (3)  (except  as  stated in the next
paragraph)  and (4), and in the proxies'  discretion on any other matters coming
before the meeting.

         Under the rules of the New York Stock Exchange, Inc., which effectively
govern the voting by any brokerage firm holding shares registered in its name or
in the name of its nominee on behalf of a beneficial owner, Proposals 1, 2 and 4
are  considered  "discretionary"  items upon which  brokerage  firms may vote in
their  discretion  on behalf of their clients if such clients have not furnished
voting  instructions within ten days prior to the Annual Meeting (shares held by
such  clients,   "broker   non-votes")   and  Proposal  3  is  considered   "non
discretionary"  and brokers who have received no instructions from their clients
do not have  discretion  to vote on this  item.  The  broker  non-votes  will be
treated in the same manner as votes present.

                                  ANNUAL REPORT

         The  annual  report  for the  fiscal  year  ended  December  31,  1998,
including financial  statements,  is being furnished herewith to shareholders of
record on March 31, 1999.  The annual  report does not  constitute a part of the
proxy soliciting material and is not deemed "filed" with the SEC.

                         SECURITY OWNERSHIP OF CERTAIN
                        BENEFICIAL OWNERS AND MANAGEMENT

         The following table sets forth certain  information with respect to the
beneficial ownership of the Company's Common Stock as of March 31, 1999, by each
shareholder  known by the Company to be the beneficial  owner of more than 5% of
its outstanding Common Stock, by each director and nominee director,  by each of
the Named  Executive  Officers  (as  defined  below)  and by all  directors  and
executive officers as a group.

                                                   AMOUNT AND NATURE
                                                     OF BENEFICIAL      PERCENT
NAME OF BENEFICIAL OWNER*                              OWNERSHIP        OF CLASS
- -------------------------                          -----------------    --------
William W. Abraham(1)                                   170,152           1.07%
Eugene R. Corasanti(2)                                  586,402           3.70%
Joseph J. Corasanti(3)                                   49,225            (4)
Bruce F. Daniels(5)                                       7,875            (4)
Joseph B. Gross(6)                                       25,700            (4)
William D. Matthews(7)                                   11,500            (4)
Robert E. Remmell(8)                                      4,950            (4)
Stuart J. Schwartz(9)                                     2,350            (4)
Robert D. Shallish, Jr.(10)                              64,875            (4)
Directors and executive officers as a group                                 
   (9 persons)(1)(2)(3)(5)(6)(7)(8)(9)(10)(11)          923,029           5.83%



                                       -2-





                                                   AMOUNT AND NATURE
                                                     OF BENEFICIAL      PERCENT
NAME OF BENEFICIAL OWNER*                              OWNERSHIP        OF CLASS
- -------------------------                          -----------------    --------

Bristol-Myers Squibb Company(12)
  345 Park Avenue
  New York, NY 10154                                  1,000,000           6.17%

Fenimore Asset Management, Inc.(13)
Thomas O. Putnam
  118 North Grand Street
  P.O. Box 310
  Cobleskill, New York 12043                          1,281,584           8.43%

Neuberger Berman, LLC(14)
Neuberger Berman Management Inc.
  605 Third Avenue
  New York, New York 10158-3698                         795,200           5.23%

- --------------------
*    Unless  otherwise set forth above,  the address of each of the above listed
     shareholders is c/o CONMED Corporation,  310 Broad Street,  Utica, New York
     13501.
(1)  Includes 152,052 shares subject to options, exercisable within 60 days.
(2)  Includes  360,502  shares subject to options,  exercisable  within 60 days.
     Also  includes  42,525 shares owned  beneficially  by the wife of Eugene R.
     Corasanti.  Eugene R.  Corasanti  disclaims  beneficial  ownership of these
     shares.
(3)  Includes  22,300  shares  subject to options,  exercisable  within 60 days.
     Joseph J. Corasanti is the son of Eugene R. Corasanti.
(4)  Less than 1%.
(5)  Includes 4,500 shares subject to options,  exercisable within 60 days. Also
     includes 3,375 shares owned  beneficially  by the wife of Bruce F. Daniels.
     Mr. Daniels disclaims beneficial ownership of these shares.
(6)  Includes 25,700 shares subject to options,  exercisable within 60 days.
(7)  Includes 1,500 shares subject to options, exercisable within 60 days.
(8)  Includes 4,500 shares subject to options, exercisable within 60 days.
(9)  Includes 850 shares owned  beneficially  by the wife of Stuart J. Schwartz.
     Mr. Schwartz disclaims beneficial ownership of these shares.
(10) Includes 61,500 shares subject to options, exercisable within 60 days.



                                       -3-








(11) Includes  634,054  shares subject to options,  exercisable  within 60 days,
     held by William W. Abraham, Eugene R. Corasanti, Joseph J. Corasanti, Bruce
     F. Daniels, Joseph B. Gross, William D. Matthews, Robert E. Remmell, Stuart
     J. Schwartz and Robert D. Shallish,  Jr.,  directors and executive officers
     of the Company. Such 634,054 shares are equal to approximately 4.17% of the
     Common Stock outstanding. As of March 31, 1999, the Company's directors and
     officers as a group (9 persons)  are the record  owners of 242,225  shares,
     which is approximately 1.59% of the Common Stock outstanding.
(12) A Schedule 13D filed with the SEC by  Bristol-Myers  Squibb Company ("BMS")
     on January 9, 1998,  indicates that BMS beneficially  owns 1,000,000 shares
     of Common Stock by virtue of having sole voting and dispositive  power over
     such shares  pursuant to a warrant to purchase  Common  Stock,  dated as of
     December  31,  1997,  issued by the Company to BMS in  connection  with the
     acquisition of Linvatec Corporation ("Linvatec") by the Company on December
     31, 1997.
(13) An Amendment  to a Schedule  13G,  filed with the SEC by these  entities on
     February 5, 1999,  indicates that such entities  beneficially own 1,281,584
     shares of Common Stock by virtue of having  shared  voting and  dispositive
     power over such shares through discretionary accounts owned economically by
     clients.
(14) A Schedule 13G filed by these entities on February 10, 1999, indicates that
     such entities  beneficially own 795,200 shares of Common Stock by virtue of
     having sole and shared voting and shared dispositive power over such shares
     through discretionary accounts owned economically by clients.

         On March  31,  1999  there  were  2,254  shareholders  of record of the
Company's Common Stock.


             SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

         Pursuant to  regulations  promulgated  by the  Securities  and Exchange
Commission,  the Company is required to  identify,  based  solely on a review of
reports filed under Section 16(a) of the  Securities  Exchange Act of 1934,  and
furnished to the Company pursuant to Rule 16a-3(c) thereunder,  each person who,
at any time  during its fiscal year ended  December  31,  1998,  was a director,
officer or  beneficial  owner of more than ten percent of the  Company's  Common
Stock  that  failed to file on a timely  basis any such  reports.  Based on such
reports,  the Company is not aware of any such failure to file on a timely basis
any such reports by any such person that has not previously been disclosed.

                                       -4-







                       PROPOSAL ONE: ELECTION OF DIRECTORS

         At the  meeting,  six  directors  are to be  elected  to  serve  on the
Company's Board of Directors. The shares represented by proxies will be voted as
specified by the  shareholder.  If the shareholder  does not specify his choice,
the shares will be voted in favor of the election of the nominees  listed on the
proxy  card,  except  that in the event any  nominee  should not  continue to be
available  for  election,  such  proxies  will be voted for the election of such
other  persons as the Board of  Directors  may  recommend.  The Company does not
presently  contemplate  that any of the  nominees  will become  unavailable  for
election for any reason.  The director  nominees who receive the greatest number
of votes at the  meeting  will be  elected  to the  Board  of  Directors  of the
Company.  Votes  against,  and votes withheld in respect of, a candidate have no
legal effect.  Shareholders are not entitled to cumulative voting rights.

         The Board of Directors recommends a vote FOR this proposal.

         The Board of Directors consists of six directors. Directors hold office
for terms  expiring at the next annual meeting of  shareholders  and until their
successors  are duly elected and  qualified.  Each of the nominees  proposed for
election at the Annual  Meeting is  presently a member of the Board of Directors
and has been elected by the shareholders.

         The  following  table  sets forth  certain  information  regarding  the
members of, and nominees for, the Board of Directors:

NOMINEES FOR ELECTION AT THE 1999 ANNUAL MEETING SERVED AS DIRECTOR PRINCIPAL OCCUPATION OR NAME AGE SINCE POSITION WITH THE COMPANY - ---- --- ----- ------------------------- Eugene R. Corasanti 68 1970 Chairman of the Board of Directors, President and Chief Executive Officer of the Company Robert E. Remmell 68 1983 Member of Steates Remmell Steates & Dziekan (Attorneys) and Assistant Secretary of the Company Bruce F. Daniels 64 1992 Executive, retired William D. Matthews 64 1997 Chairman of the Board of Directors and retired Chief Executive Officer of Oneida Ltd. and director of Oneida Financial Corporation and Coyne Textile Services Stuart J. Schwartz 62 1998 Physician, retired Joseph J. Corasanti 35 1994 Executive Vice President/General Manager of the Company
-5- DIRECTORS, EXECUTIVE OFFICERS AND SENIOR OFFICERS EUGENE R. CORASANTI (age 68) has served as President and Chairman of the Board of the Company since its incorporation in 1970. Mr. Corasanti is also the Company's Chief Executive Officer. Prior to that time he was an independent public accountant. Mr. Corasanti holds a B.B.A. degree in Accounting from Niagara University. Eugene R. Corasanti's son, Joseph J. Corasanti, is a Director and Executive Vice President/General Manager of the Company. ROBERT E. REMMELL (age 68) has served as a Director since June 1983 and as an Assistant Secretary since June 1983. Mr. Remmell has been a partner since January 1961 of Steates Remmell Steates & Dziekan, Utica, New York, the Company's corporate counsel. The Company paid approximately $7,400 to Steates Remmell Steates & Dziekan for services rendered during fiscal year 1998. Mr. Remmell holds a B.A. degree from Utica College and an L.L.B. from Syracuse University School of Law. BRUCE F. DANIELS (age 64) has served as a Director of the Company since August 1992. Mr. Daniels is a retired executive. From August 1974 to June 1997, Mr. Daniels held various executive positions with Chicago Pneumatic Tool Company. Mr. Daniels holds a B.S. degree in Business from Utica College. WILLIAM D. MATTHEWS (age 64) has served as a Director of the Company since August 1997. Since 1986 he has been the Chairman of the Board, and from 1986 to his retirement in January 1999 he was the Chief Executive Officer of, Oneida Ltd. Mr. Matthews holds a B.A. degree from Union College and an L.L.B. degree from Cornell University School of Law. STUART J. SCHWARTZ (age 62) has served as a Director of the Company since May 1998. Dr. Schwartz is a retired physician. From 1969 to December 1997 he was engaged in private practice as an urologist. Dr. Schwartz holds a B.A. degree from Cornell University and a M.D. degree from SUNY Upstate Medical College, Syracuse. JOSEPH J. CORASANTI (age 35) has served as a Director of the Company since May 1994. He also served as General Counsel and Vice President-Legal Affairs of the Company from March 1993 to August 1998 at which time he was named Executive Vice-President/General Manager of the Company. Prior to that time he was an Associate Attorney with the law firm of Morgan, Wenzel & McNicholas, Los Angeles, California from 1990 to March 1993. Mr. Corasanti holds a B.A. degree in Political Science from Hobart College and a J.D. degree from Whittier College School of Law. Joseph J. Corasanti is the son of Eugene R. Corasanti, Chairman, President and Chief Executive Officer of the Company. WILLLAM W. ABRAHAM (age 67) joined the Company in May 1977 as General Manager. He has served as the Company's Vice President-Manufacturing and Engineering since June 1983. In November of 1989 he was named Executive Vice President and on March 24, 1993, he was named Senior Vice President of the Company. Mr. Abraham holds a B.S. degree in Industrial Management from Utica College. ROBERT D. SHALLISH, JR. (age 50) joined the Company as Chief Financial Officer and Vice President-Finance in December 1989 and has also served as an Assistant Secretary since March 1995. Prior to this he was employed as Controller of Genigraphics Corporation in Syracuse, New York since 1984. He was employed by Price Waterhouse LLP as a certified public accountant and senior manager from 1972 through 1984. Mr. Shallish graduated with a B.A. degree in Economics from Hamilton College and holds a Master's degree in Accounting from Syracuse University. -6- THOMAS M. ACEY (age 52) has been employed by the Company since August 1980 and has served as the Company's Treasurer since August 1988 and as the Company's Secretary since January 1993. Mr. Acey holds a B.S. degree in Public Accounting from Utica College and prior to joining the Company was employed by the certified public accounting firm of Tartaglia & Benzo in Utica, New York. LUKE A. POMILIO (age 34) joined the Company as Controller in September 1995. Prior to his employment with the Company, Mr. Pomilio served for two years as Controller of Rome Cable Corporation, a wire and cable manufacturer. He was also employed as a certified public accountant for seven years with Price Waterhouse LLP where he served most recently as an audit manager. Mr. Pomilio graduated with a B.S. degree in Accounting and Law from Clarkson University. DANIEL S. JONAS (age 35) joined the Company as General Counsel in August 1998 and in addition became the Vice President-Legal Affairs in March 1999. Prior to his employment with the Company he was a partner with the law firm of Harter, Secrest & Emery, LLP in Syracuse from January 1998 to August 1998, having joined the firm as an Associate Attorney in 1995. Prior to that he was an Associate Attorney at Miller, Alfano & Raspanti, P.C. in Philadelphia from 1992 to 1995 as well as an adjunct professor of law at the University of Pennsylvania Law School from 1991 to 1995. Mr. Jonas holds an A.B. degree from Brown University and a J.D. from the University of Pennsylvania Law School. FRANK R. WILLIAMS (age 50) joined the Company in 1974 as Sales Manager and Director of Marketing and became Vice President-Marketing and Sales in June 1983. In September 1989 he became Vice President-Business Development and became Vice President-Technology Assessment in November 1995. Mr. Williams graduated with a B.A. degree from Hartwick College in 1970 as a biology major and did his graduate study in Human Anatomy at the University of Rochester College of Medicine. JOSEPH B. GROSS (age 40) joined the Company as Manager of Manufacturing Engineering in April 1988 and became Vice President-Operations in May 1992. In addition, in April 1998 he became the President of Linvatec, a wholly owned subsidiary of the Company. Prior to his employment with the Company, Mr. Gross was employed at Oneida Ltd. Silversmiths. Mr. Gross holds a B.S. degree from the State University of New York-College of Technology and a Master's degree in Business Administration from Rensselaer Polytechnic Institute. JOHN J. STOTTS (age 43) joined the Company as Vice President-Marketing and Sales for Patient Care in July 1993 and became Vice President-Marketing in December 1996. Prior to his employment with the Company, Mr. Stotts served as Director of Marketing and Sales for Medtronic Andover Medical, Inc. Mr. Stotts holds a B.A. degree in Business Administration from Ohio University. JOHN V. SCIBELLI (age 52) joined the Company as President of Aspen Laboratories, Inc., a wholly owned subsidiary of the Company, in August 1998. Prior to his employment with the Company, Mr. Scibelli was employed by Valleylab Inc. Division of Pfizer for twelve years where he served in a number of senior management capacities, most recently as President. Mr. Scibelli holds a B.S. degree from Long Island University and a Ph.D. degree in Chemistry from the University of Michigan. ALEXANDER R. JONES (age 42) joined the Company as a Sales Representative in October 1982 and become Vice President, Sales in November 1998. During his employment with the Company, Mr. Jones has also served as Canadian Sales Manager, Director-National Accounts, Regional Sales Manager and National Sales Manager. Mr. Jones holds a B.A. degree from Muhlenberg College. -7- The Company's Directors are elected at each annual meeting of shareholders and serve until the next annual meeting and until their successors are duly elected and qualified. Eugene R. Corasanti's employment is subject to an employment agreement which expires December 31, 2001. The Company's other officers are appointed by the Board of Directors and hold office at the will of the Board of Directors. MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES The Company's Board of Directors has three standing committees: the Audit Committee, the Stock Option Committee and the Compensation Committee. The Company has no nominating committee. The Audit Committee presently consists of Messrs. Daniels, Matthews and Remmell. The Audit Committee is charged with evaluating accounting and control procedures and practices of the Company and reporting on such to the Board of Directors. The Audit Committee also serves as the direct liaison with the Company's independent public accountants and recommends the engagement or discharge of such auditors. The Audit Committee met two times during 1998. The Stock Option Committee presently consists of Messrs. Daniels and Remmell and Dr. Schwartz. The Stock Option Committee administers the Company's employee stock option plans and has authority to grant options to officers and key employees, as designated by the Stock Option Committee, and to determine the terms of such options in accordance with such plan. The Stock Option Committee acted by unanimous written consent on resolutions twelve times during 1998. The Compensation Committee presently consists of Messrs. Daniels, Matthews and Remmell. The Compensation Committee is charged with reviewing and establishing levels of salary, bonuses, benefits and other compensation for the Company's officers. The Compensation Committee met two times during 1998. The full Board of Directors met eight times (seven times in person and once by telephone) and voted by unanimous consent on resolutions once during 1998. Each incumbent director attended or acted upon at least 75% of the total 1998 board meetings or unanimous consents and committee meetings or unanimous consents held or acted upon during periods that he was a member of the Board or such committees. Each Director was paid $1,000 for each of the seven meetings of the full Board of Directors personally attended and Messrs. Daniels, Matthews and Remmell, as non-employee directors, were paid $2,500 for each of the four fiscal quarters of service on the Board of Directors. Dr. Schwartz, as a non-employee director, received two $2,500 payments for two fiscal quarters of service on the Board of Directors and $2,000 for his attendance at two meetings of the full Board of Directors. Harry Cone received $7,000 for his services as a director until May 19, 1998 (consisting of two $2,500 payments for two fiscal quarters of service on the Board of Directors and $2,000 for his attendance at two meetings of the full Board of Directors) when his term in office terminated upon his decision not to stand for election at the 1998 annual meeting of shareholders. Mr. Cone did not decline to stand for re-election due to a disagreement with the Company on any matter. In addition, under the Company's Stock Option Plan for Non-Employee Directors, each non-employee director (Messrs. Cone, Daniels and Remmell in 1996 and 1997, Messrs. Daniels, Matthews and Remmell and Dr. Schwartz in 1998 and, if elected, Messrs. Daniels, Matthews and Remmell and Dr. Schwartz in 1999) elected, reelected or continuing as a director, receives 1,500 options with an option price equal to the fair market value of the Company's Common Stock on the business day following each annual meeting of the shareholders. -8- COMPENSATION OF EXECUTIVE OFFICERS The following information relates to all plan and non-plan compensation awarded to, earned by, or paid to (i) Eugene R. Corasanti, the Chairman of the Board of Directors, President and Chief Executive Officer of the Company (the "CEO") and (ii) William W. Abraham, Robert D. Shallish, Jr., Joseph B. Gross and Joseph J. Corasanti, the Company's four most highly compensated executive officers, other than the CEO, who were serving as executive officers of the Company at December 31, 1998 (the CEO and such officers, the "Named Executive Officers"). The following information does not reflect any compensation awarded to or earned by the Named Executive Officers subsequent to December 31, 1998, except as may otherwise be indicated. Any compensation awarded to or earned by the Named Executive Officers during 1999 will be reported in the proxy statement for the Company's 2000 Annual Meeting of Shareholders, unless such compensation has been previously reported. SUMMARY COMPENSATION TABLE The following table sets forth for the Named Executive Officers for each of the last three fiscal years: (i) the name and principal position of the executive officer (column (a)); (ii) the year covered (column (b)); (iii) annual compensation (columns (c), (d) and (e)), including: (A) base salary earned during the year covered (column (c)); (B) bonus earned during the year covered (column (d)); and (C) other annual compensation not properly categorized as salary or bonus (column (e)); and (iv) long-term compensation, including the sum of the number of stock options granted (column (f)). -9-
SUMMARY COMPENSATION TABLE Long-Term Compensation Annual Compensation Awards --------------------------------------------------- ------------ (a) (b) (c) (d) (e) (f) Other Annual Name and Principal Fiscal Salary Bonus Compensation Options Position Year ($) ($)(1) ($) (#) ------------------ ------ ------ ----- ------------ ------- Eugene R. Corasanti, 1998 300,000 45,000 225,000(2) 55,000 President, Chief 1997 300,000 - 202,000(2) 1,500 Executive Officer and 1996 250,523 - 165,000(2) 62,000 Chairman of the Board William W. Abraham, 1998 176,557 25,350 - 5,000 Senior Vice President 1997 161,007 10,000 - 20,000 1996 152,107 - - 7,000 Joseph B. Gross, 1998 164,990 24,180 - 35,000 Vice President- 1997 144,957 25,000 - 31,000 Operations and 1996 134,307 - - 7,000 President of Linvatec Robert D. Shallish, Jr., 1998 158,662 22,893 - 5,000 Chief Financial Officer 1997 144,957 25,000 - 20,000 and Vice President- 1996 134,307 - - 7,000 Finance Joseph J. Corasanti 1998 133,195 21,843 - 30,000 Executive Vice-President/ 1997 118,995 10,000 - 22,500 General Manager 1996 106,607 - - 7,000 - ------------------ (1) Includes cash bonuses in year earned even if paid after the fiscal year end. (2) Amounts represent deferred compensation and accrued interest for Mr. Corasanti. See the discussion of Mr. Corasanti's employment agreement, below.
Eugene R. Corasanti has a five-year employment agreement (the "Employment Agreement") with the Company, extending through December 31, 2001. The Employment Agreement provides for Mr. Corasanti to serve as president and chief executive officer of the Company for five years at an annual salary, not less than $300,000, as determined by the Board of Directors. Mr. Corasanti also receives deferred compensation of $100,000 per year with interest at 10% per annum, payable in 120 equal monthly installments upon his retirement or to his beneficiaries at death, and is entitled to participate in the Company's employee stock option plan and pension and other employee benefit plans and such bonus or other compensatory arrangements as may be determined by the Board of Directors. In the event that the Board of Directors should fail to re-elect Mr. Corasanti as president and chief executive officer or should terminate his employment for reasons other than just cause, Mr. Corasanti will become entitled to receive the greater of three years' base annual salary or the balance of his base annual salary plus the average of the bonuses, deferred compensation and incentive compensation awarded to Mr. Corasanti during the three years -10- prior to such termination for the five-term employment term, and shall continue to receive other employment benefits, for the greater of three years or the balance of the Employment Agreement's five-year term. In the event of Mr. Corasanti's death or disability, Mr. Corasanti or his estate or beneficiaries will be entitled to receive 100% of his base annual salary and other employment benefits (other than deferred compensation) for the balance of the Employment Agreement's term. If, during the term of Mr. Corasanti's employment under the Employment Agreement and within two years after a Change in Control, his employment with the Company is terminated by the Company, other than for Cause or by him for Good Reason (as such capitalized terms are defined in the Employment Agreement), Mr. Corasanti will be entitled to receive (a) a lump sum payment equal to three times the sum of (i) his base salary on the date of such termination or his base salary in effect immediately prior to the Change in Control, whichever is higher, plus (ii) the average of the bonuses, deferred compensation and incentive compensation awarded to Mr. Corasanti during the three years prior to such termination; (b) continued coverage under the benefit plans in which he participates for a period of two years from the date of such early termination; (c) a lump sum payment equal to the aggregate amount credited to his deferred compensation account; and (d) awards for the calendar year of such termination under incentive plans maintained by the Company as though any performance or objective criteria used in determining such awards were satisfied. The Board of Directors has determined that Mr. Corasanti's base salary will be $320,000 for 1999. The Company is paying the premiums on three split-dollar life insurance policies for Eugene R. Corasanti as described under "Board of Directors Interlocks and Insider Participation; Certain Relationships and Related Transactions." In 1998, premiums on these policies paid by the Company aggregated approximately $49,000. STOCK OPTION PLANS THE 1992 PLAN In April 1992, the shareholders approved the CONMED Corporation 1992 Stock Option Plan (as amended and approved by the shareholders on May 21, 1996, the "1992 Plan"). Under the 1992 Plan, in the discretion of the Stock Option Committee of the Board of Directors (the "Committee"), options may be granted to officers and key employees of the Company and its subsidiaries for the purchase of shares of Common Stock. The Committee presently consists of Messrs. Daniels and Remmell and Dr. Schwartz. Options may be granted which are (i) incentive stock options within the meaning of Internal Revenue Code Section 422 or (ii) options other than incentive stock options (i.e., non-qualified options). A total of 2,000,000 shares of Common Stock (subject to adjustment for stock splits and other changes in the Company's capital structure) are reserved against the exercise of options to be granted under the 1992 Plan. Shares reserved under an option which for any reason expires or is terminated, in whole or in part, shall again be available for the purposes of the 1992 Plan. Options relating to 1,639,134 shares of Common Stock have been granted and not terminated under the 1992 Plan, of which options relating to 1,353,593 shares of Common Stock are still exercisable. Options relating to 360,866 shares of Common Stock remain available to be granted. -11- THE 1983 PLAN In June 1983, the shareholders of the Company approved an employee stock option plan (the "1983 Plan"), which was subsequently amended and approved by the shareholders on June 30, 1987 and April 10, 1992. Options may be granted which are (i) incentive stock options within the meaning of Internal Revenue Code Section 422 or (ii) options other than incentive stock options (i.e., non-qualified options). Pursuant to the 1983 Plan, officers and key employees of the Company were eligible for grants of stock options at the fair market value of the Company's Common Stock on the date of grant, exercisable commencing one year after grant. The 1983 Plan is administered by the Committee. No additional options may be granted under the 1983 Plan. Options relating to 1,005,753 shares of Common Stock were granted under the 1983 Plan, of which options for 108,014 shares of Common Stock are still exercisable. STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS In May 1995, the shareholders of the Company approved the Stock Option Plan For Non-Employee Directors of CONMED Corporation (the "Non-Employee Directors Plan"). All members of the Company's Board of Directors who are not current or former employees of the Company or any of its subsidiaries ("Non-Employee Directors") are eligible to participate in the Non-Employee Directors Plan. Under the Non-Employee Directors Plan, each Non-Employee Director (Messrs. Cone, Daniels and Remmell in 1996 and 1997, Messrs. Daniels, Matthews and Remmell and Dr. Schwartz in 1998 and if elected, Messrs. Daniels, Matthews and Remmell and Dr. Schwartz in 1999) elected, reelected or continuing as a director receives 1,500 options (which are non-qualified stock options under the Internal Revenue Code of 1986) with an option price equal to the fair market value of the Company's Common Stock on the business day following each annual meeting of the shareholders. A total of 75,000 shares of Common Stock (subject to adjustment for stock splits and other changes in the Company's capital structure) are reserved against the exercise of options to be granted and not terminated under the Non-Employee Directors Plan, of which options for 16,500 shares of Common Stock have been granted and options for 6,000 shares are still exercisable. Options relating to 58,500 shares of Common Stock remain available to be granted. Shares issuable under the Non-Employee Directors Plan may be authorized but unissued shares or treasury shares. Shares reserved under an option which for any reason expires or is terminated, in whole or in part, shall again be available for the purposes of the Non-Employee Directors Plan. -12- OPTION GRANTS TABLE The following table sets forth, with respect to grants of stock options made during 1998 to each of the Named Executive Officers: (i) the name of the executive officer (column (a)); (ii) the number of securities underlying options granted (column (b)); (iii) the percent the grant represents of the total options granted to all employees during 1998; (iv) the per share exercise price of the options granted (column (d)); (v) the expiration date of the options (column (e)); and (vi) the potential realizable value of each grant, assuming the market price of the Common Stock appreciates in value from the date of grant to the end of the option term at a rate of (A) 5% per annum (column (f)) and (B) 10% per annum (column (g)).
OPTION GRANTS IN 1998 Potential Realizable Value at Assumed Annual Rates of Stock Price Appreciation for Individual Grants Option Term - ------------------------------------------------------------------------------------- -------------------------- (a) (b) (c) (d) (e) (f) (g) Number of Securities Underlying % of Total Options Options Granted Exercise or Granted to Employees in Base Price Expiration Name (#) 1998 ($/Sh) Date 5% ($) 10% ($) ---- ---------- --------------- ----------- ---------- ------ --------- Eugene R. Corasanti 50,000 9.83% 21.9375 1/27/08 689,819 1,748,136 5,000 0.98% 22.5000 5/19/08 70,751 179,296 William W. Abraham 5,000 0.98% 22.5000 5/19/08 70,751 179,296 Joseph B. Gross 20,000 3.93% 23.2500 5/4/08 292,436 741,090 5,000 0.98% 22.5000 5/19/08 70,751 179,296 10,000 1.97% 27.2500 11/4/08 171,374 434,295 Robert D. Shallish, Jr. 5,000 0.98% 22.5000 5/19/08 70,751 179,296 Joseph J. Corasanti 5,000 0.98% 22.5000 5/19/08 70,751 179,296 25,000 4.92% 20.6875 9/14/08 325,256 824,264
-13- AGGREGATED OPTION EXERCISES AND YEAR-END OPTION VALUE TABLE The following table sets forth, with respect to each exercise of stock options during 1998 by each of the Named Executive Officers and the year-end value of unexercised options on an aggregated basis: (i) the name of the executive officer (column (a)); (ii) the number of shares received upon exercise, or, if no shares were received, the number of securities with respect to which the options were exercised (column (b)); (iii) the aggregate dollar value realized upon exercise (column (c)); (iv) the total number of securities underlying unexercised options held at December 31, 1998, separately identifying the exercisable and unexercisable options (column (d)); and (v) the aggregate dollar value of in-the-money, unexercised options held at December 31, 1998, separately identifying the exercisable and unexercisable options (column (e)). The Company's stock option plans do not provide for stock appreciation rights.
AGGREGATED OPTION EXERCISES IN 1998 AND DECEMBER 31, 1998 OPTION VALUES (a) (b) (c) (d) (e) Number of Securities Value of Unexercised In- Underlying Unexercised the-Money Options at Options at 12/31/98(#) 12/31/98($)(1) ------------------------- -------------------------- Shares Acquired Value Exercisable/ Exercisable/ Name on Exercise (#) Realized ($) Unexercisable Unexercisable ---- --------------- ------------ ------------- ------------- Eugene R. Corasanti 0 0 305,502/55,000 5,886,640/605,625 William W. Abraham 0 0 144,051/8,001 2,962,917/114,272 Joseph B. Gross 5,450 78,244 16,000/67,000 116,000/644,950 Robert S. Shallish 500 13,960 58,000/28,200 1,129,091/266,800 Joseph J. Corasanti 21,600 297,731 15,300/61,200 121,731/729,487 - -------------------- (1) Assumes $33 per share fair market value on December 31, 1998.
PENSION PLANS The Company maintains a broadly based defined benefit pension plan (the "Pension Plan") for all employees. The Pension Plan entitles a participant to a normal monthly retirement benefit equal to 1 1/2% of the participant's average monthly earnings over the period of employment times years of service. Eugene R. Corasanti's deferred compensation is not included in the calculation of his retirement benefits. Benefits are fully vested after five years of service, starting from date of hire. Upon reaching normal retirement age, generally age 65 with five years of credited service, participants are entitled to receive vested benefits under the Pension Plan either in the form of a lump sum payment or a monthly retirement benefit. The Pension Plan represents a "fresh start" as of January 1, 1989, replacing the three pension plans formerly in place. The three former plans have been merged into the Pension Plan, which is the former broadly based plan with the benefit formula increased from 1/2% of pay to 1 1/2% of pay. Benefits accrued by participants under the former plans became fully vested as of December 31, 1988 and are paid, when due, from this "fresh start" Pension Plan. Benefits accrued under the former plans are payable from the Pension -14- Plan in addition to the benefits to be received under the Pension Plan. During 1996, Mr. William W. Abraham reached normal retirement age under the Pension Plan and elected to receive a lump sum payment of the actuarial equivalent value of his accrued benefits, as of October 31, 1996. As of December 31, 1998, Messrs. E. Corasanti, Abraham, Shallish and J. Corasanti had three, two, nine and six years of credited service, respectively. The first table presents information concerning the annual pension payable under the Pension Plan based upon various assumed levels of annual compensation and years of service. The benefits listed in the table are not subject to any deduction for Social Security or other offset amounts. As of December 31, 1997, the Company acquired Linvatec from BMS. In connection with the acquisition, the Company established a defined Benefit Retirement Plan (the "Linvatec Plan") effective January 1, 1998 which provides the same level of benefits to the Linvatec employees as the BMS plan provided prior to the acquisition. Assets equal to the present value of the accrued benefits of the Linvatec employees were transferred from the BMS plan to the new Linvatec Plan once those figures became available. Participants therefore continue under the new plan as if nothing had changed. The Linvatec Plan provides coverage to all employees of the Linvatec group who have attained the age of 18. The Linvatec Plan provides for benefits payable to eligible participants in an amount equal to approximately 2% of five year average earnings less 1/70 of the estimated primary insurance amount multiplied by the years of service rendered not to exceed 40 years. Benefits are fully vested after the participant completes 5 years of service. Upon reaching normal retirement age, generally age 65, participants are entitled to receive vested benefits under the Linvatec Plan in the form of an annuity payable for life, or in some other actuarial equivalent option. As of December 31, 1998, Mr. Gross had eleven years of credited service. The second table presents information concerning the annual pension payable under the Linvatec Plan based upon various assumed levels of annual compensation and years of service. The benefits listed in the table are subject to any deduction for Social Security or other offset amounts.
CONMED PENSION PLAN Years of Service ------------------------------------------------------------------------------------- Average Pay 15 20 25 30 35 ----- ---- ---- ---- ---- --- $125,000 $28,125 $37,500 $46,875 $56,250 $65,625 $150,000 33,750 45,000 56,250 67,500 78,750 $175,000(1) 36,000 48,000 60,000 72,000 84,000 $200,000(1) 36,000 48,000 60,000 72,000 84,000 $225,000(1) 36,000 48,000 60,000 72,000 84,000 $250,000(1) 36,000 48,000 60,000 72,000 84,000 $300,000(1) 36,000 48,000 60,000 72,000 84,000 $400,000(1) 36,000 48,000 60,000 72,000 84,000 $450,000(1) 36,000 48,000 60,000 72,000 84,000 $500,000(1) 36,000 48,000 60,000 72,000 84,000
-15-
LINVATEC PENSION PLAN Years of Service ------------------------------------------------------------------------------------- Average Pay 15 20 25 30 35 ----- ---- ---- ---- ---- --- $125,000 $33,924 $45,232 $66,540 $67,848 $79,156 $150,000 41,424 55,232 69,040 82,848 96,656 $175,000(1) 44,424 59,232 74,040 88,848 103,656 $200,000(1) 44,424 59,232 74,040 88,848 103,656 $225,000(1) 44,424 59,232 74,040 88,848 103,656 $250,000(1) 44,424 59,232 74,040 88,848 103,656 $300,000(1) 44,424 59,232 74,040 88,848 103,656 $400,000(1) 44,424 59,232 74,040 88,848 103,656 $450,000(1) 44,424 59,232 74,040 88,848 103,656 $500,000(1) 44,424 59,232 74,040 88,848 103,656 - ------------ (1) 1998 statutory limits are $130,000 for straight life annuity benefit payable at age 65 and $160,000 for annual compensation taken into account in determining average pay.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION The Company's Board of Directors, pursuant to the terms of the Employment Agreement, establishes the annual salary of Eugene R. Corasanti. The Compensation Committee establishes the compensation plans and specific compensation levels for the Company's other officers. The Stock Option Committee administers the Company's stock option plans. The Compensation Committee is presently composed of Bruce F. Daniels, William D. Matthews and Robert E. Remmell. The Stock Option Committee is presently composed of Bruce F. Daniels, Robert E. Remmell and Stuart J. Schwartz. The Board of Directors believes that the compensation of Eugene R. Corasanti, the Company's President and Chairman ("CEO"), should be heavily influenced by company performance, long-term growth and strategic positioning. Therefore, although there is necessarily some subjectivity in setting the CEO's salary, major elements of the compensation package are directly tied to company performance, long-term growth and strategic positioning. This philosophy is reflected in Mr. Corasanti's current five-year employment contract, which provides for a base annual salary of $300,000 and permits the Board of Directors to determine a higher salary in its discretion. In 1993, while the Company consummated the $21.8 million acquisition of certain assets and the business of Medtronic Andover Medical, Inc. from Medtronic Inc., the Company incurred a net loss of $1.4 million, primarily as a result of a $5.0 million charge relating to patent infringement litigation. In 1994, the Company returned to profitability, recording net income of $5.4 million, or $0.56 per diluted share. In 1995, the Company acquired Birtcher Medical Systems, Inc. (in a $21.2 million stock-for-stock exchange) and the business and substantially all of the assets of The Master Medical Corporation (in a $10.0 million purchase transaction) and recorded net income of $10.9 million, or $0.94 per diluted share. In 1996, the Company acquired the business and substantially all of the assets of New Dimensions In Medicine, Inc. in a -16- $34.9 million purchase transaction and continued to increase the level of net income to $16.3 million, or $1.12 per diluted share. In the light of the foregoing matters, on November 4, 1996, the Board of Directors approved Mr. Corasanti's current employment agreement, for employment from January 1, 1997 through December 31, 2001. In 1997, the Company continued to integrate its completed acquisitions, recording then record revenues of $138.2 million. The Company also completed two additional acquisitions to nearly triple the Company's size -- the acquisition of a surgical suction instrument and tubing product line from the Davol subsidiary of C.R. Bard, Inc. for a cash purchase price of $24 million and the acquisition of Linvatec and certain related assets from BMS for a cash purchase price of $370 million (plus the assumption of net liabilities totalling approximately $16.6 million) and the issuance of a warrant to purchase one million shares of the Company's Common Stock at a warrant exercise price of $34.23. For 1997, excluding unusual charges related to the acquisition of Linvatec and the closure of the Company's Dayton, Ohio manufacturing facility, the Company had net income of $17 million, or $1.12 per diluted share. In 1998, the Company continued to integrate its completed acquisitions, again recording record revenues of $336.4 million. The Company, through its wholly owned subsidiary Linvatec, acquired an arthroscopic fluid control product line from Minnesota Mining and Manufacturing Company for a cash purchase price of $17.5 million. For 1998, excluding a one-time charge in connection with the refinancing of the Company's credit facility, the Company had net income of $19.4 million, or $1.26 per diluted share. The Company's stock price has increased from $7.22 on December 31, 1992 to $33 on December 31, 1998. In light of these factors, the Board of Directors awarded Mr. Corasanti 1998 base salary compensation of $312,277. The Compensation Committee has adopted similar policies with respect to compensation of the other executive officers of the Company. The Company's performance, long-term growth and strategic positioning and the individual's past performance and future potential are considered in establishing the base salaries of executive officers. The policy regarding other elements of the compensation package for executive officers is similar to the CEO's in that the package is tied to achievement of performance targets. As discussed below, in 1998, the Company granted each of the Company's executive officers, including Eugene R. Corasanti, stock options. Stock options are granted to the Company's executive officers, including Eugene R. Corasanti, primarily based on the executive's ability to influence the Company's long-term growth and profitability. The number of options granted is determined by using the same subjective criteria. All options are granted at the current market price. Since the value of an option bears a direct relationship to the Company's stock price it is an effective incentive for managers to create value for shareholders. The Committee therefore views stock options as an important component of its long-term, performance-based compensation philosophy. The Committee granted 55,000 stock options to Eugene R. Corasanti in 1998. In 1998, the Committee granted 174,500 options to executive officers. The Board of Directors has not yet adopted a policy with respect to qualification of executive compensation in excess of $1 million per individual for deduction under Section 162(m) of the Internal Revenue Code of 1986, as amended, and the regulations thereunder. The Board of Directors does not anticipate that the compensation of any executive officer during 1998 will exceed the limits for deductibility. -17- In determining a policy for future periods, the Board of Directors would expect to consider all relevant factors, including the Company's tax position and the materiality of the amounts likely to be involved. Board of Directors Compensation Committee Stock Option Committee - ------------------ ---------------------- ---------------------- Eugene R. Corasanti, Chairman Bruce F. Daniels Bruce F. Daniels Joseph J. Corasanti William D. Matthews Robert E. Remmell Bruce F. Daniels Robert E. Remmell Stuart J. Schwartz William D. Matthews Robert E. Remmell Stuart J. Schwartz BOARD OF DIRECTORS INTERLOCKS AND INSIDER PARTICIPATION; CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS The Company's Board of Directors, which is presently composed of Eugene R. Corasanti, Joseph J. Corasanti, Bruce F. Daniels, William D. Matthews, Robert E. Remmell and Stuart J. Schwartz, establishes the compensation plans and specific compensation levels for Eugene R. Corasanti directly (with Mr. Corasanti abstaining) and for other executive officers through the Compensation Committee, and administers the Company's stock option plans through the Stock Option Committee. As disclosed above, Eugene R. Corasanti, the Chairman of the Board of Directors, is the President and Chief Executive Officer of the Company and also serves as an officer of the Company's subsidiaries. Joseph J. Corasanti, a director of the Company, is the Executive Vice President/General Manager of the Company, also serves as an officer of several of the Company's subsidiaries and is the son of Eugene R. Corasanti. Robert E. Remmell is the Assistant Secretary of the Company and also serves as an officer of several of the Company's subsidiaries. The Company pays all premiums on three split-dollar life insurance policies totaling $3,175,000 for the benefit of Eugene R. Corasanti. Premiums paid or accrued by the Company in the fiscal year ended December 31, 1998 were approximately $49,000. Of such premiums, an aggregate of approximately $4,200 has been reflected as compensation to Mr. Corasanti. The remaining amount of $44,800 is being treated by the Company as a loan to Mr. Corasanti. At December 31, 1998, the aggregate amount due the Company from Mr. Corasanti related to these split-dollar life insurance policies is $453,000. This amount (and subsequent loans for future premiums) will be repaid to the Company on Mr. Corasanti's death and the balance of the policy will be paid to Mr. Corasanti's estate or beneficiaries. Robert E. Remmell, Assistant Secretary, director and shareholder of the Company and an officer of several of the Company's subsidiaries, is a partner of Steates Remmell Steates & Dziekan, the Company's corporate counsel. The Company paid approximately $7,400 to Steates Remmell Steates & Dziekan in 1998. The Company has entered into directors and officers insurance policies with National Union Fire Insurance Company of Pittsburgh, PA and Chubb Insurance Company covering the period from January 31, 1999 through January 31, 2000 at a total cost of $175,000, which covers directors and officers of the Company and its subsidiaries. -18- PERFORMANCE GRAPH The graph below compares the yearly percentage change in the Company's Common Stock with the cumulative total return of the Center for Research for Stock Performance ("CRSP") Total Return Index for the NASDAQ Stock Market and the cumulative total return of the Standard & Poor's Medical Products and Supplies Industry Group Index. In each case, the cumulative total return assumes reinvestment of dividends into the same class of equity securities at the frequency with which dividends are paid on such securities during the applicable fiscal year. COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN* AMONG CONMED CORPORATION, THE NASDAQ STOCK MARKET (U.S.) INDEX AND THE S&P HEALTH CARE (MEDICAL PRODUCTS & SUPPLIES) INDEX 12/93 12/94 12/95 12/96 12/97 12/98 ----- ----- ----- ----- ----- ----- CONMED 100 281 529 434 556 699 CORPORATION NASDAQ STOCK 100 98 138 170 209 293 MARKET (U.S.) S&P HEALTH CARE 100 119 200 230 287 413 (MEDICAL PRODUCTS & SUPPLIES) *$100 INVESTED ON 12/31/93 IN STOCK OR INDEX - INCLUDING REINVESTMENT OF DIVIDENDS. FISCAL YEAR ENDING DECEMBER 31. -19- PROPOSAL TWO: INDEPENDENT PUBLIC ACCOUNTANTS The independent accountants for the Company have been PricewaterhouseCoopers LLP since 1982. The Audit Committee recommended to the Board of Directors that PricewaterhouseCoopers LLP be nominated as independent accountants for 1999, and the Board has approved the recommendation. Unless otherwise specified, shares represented by proxies will be voted for the appointment of PricewaterhouseCoopers LLP as independent accountants for 1999. Representatives of PricewaterhouseCoopers LLP are expected to be present at the meeting. Such representatives will have the opportunity to make a statement if they desire to do so and are expected to be available to respond to appropriate questions. The affirmative vote of the holders of a majority of votes cast at the meeting is necessary for the appointment of PricewaterhouseCoopers LLP as independent accountants for the Company for 1999. The Board of Directors recommends a vote FOR this proposal. PROPOSAL THREE: ADOPTION OF 1999 LONG-TERM INCENTIVE STOCK PLAN The Board of Directors adopted the Company's 1999 Long-Term Incentive Plan (the "1999 LTIP") on March 3, 1999, subject to the approval of shareholders. The Board of Directors believes that the Company's long-term financial interests, including its growth and performance, are dependent upon its ability to attract and retain employees and consultants of outstanding ability. The 1999 LTIP will provide the Company an opportunity to encourage selected employees and consultants and employees and consultants of its subsidiaries to acquire an ownership interest in the Company and will help align their economic interests directly with those of the Company's shareholders. The 1999 LTIP will also provide the Company with flexibility to offer, in line with competitive practices, compensation packages to selected candidates whose contributions and skills are important to its long-term success. The present executive officers of the Company are potential beneficiaries under the 1999 LTIP. The Company historically has declined to reprice options as a matter of policy. This policy has been incorporated into the 1999 LTIP to ensure that the interests of employees and consultants who receive options will continue to be closely tied to the long-term performance of the Company. The following summary of the principal terms of the 1999 LTIP is qualified in its entirety by reference to the complete text of the 1999 LTIP set forth in Exhibit A to this Proxy Statement. General. Under the 1999 LTIP, the Company may grant employees or consultants stock options (either incentive stock options within the meaning of Section 422 of the Code or nonstatutory stock options), performance shares and restricted stock (collectively, the "awards"). The 1999 LTIP is administered by the Stock Option Committee (the "Committee" or the "Stock Option Committee"), which is authorized to select employees of the Company and its subsidiaries and consultants to receive awards, determine the type, size and terms of awards to be made, determine the number of shares of Common Stock or share units subject to any award and determine the other terms and conditions of such awards to the extent not provided for in the 1999 LTIP. The Committee also has the authority to interpret the Plan, to establish, amend or rescind any rules and regulations relating to the Plan and to make all other determinations necessary or advisable for the administration of the Plan. Subject to limits it may establish, the Committee may delegate such authority with respect to employees other than those considered to be Covered Employees under the 1999 LTIP (including the Chief Executive Officer and employees whom the Committee considers -20- likely to be among the four most other highly compensated executive officers for the year in which an award is made or payable) and other employees who are subject to Section 16 of the Exchange Act. All employees of the Company and its subsidiaries and certain consultants who have entered into consultancy agreements with the Company or any subsidiary who have demonstrated significant management potential or who have the capacity for contributing in a substantial measure to the successful performance of the Company, as determined by the Stock Option Committee, are eligible to receive awards under the 1999 LTIP. The Stock Option Committee may also deem other Company or subsidiary employees and consultants eligible to receive awards of nonstatutory options under the 1999 LTIP. While such criteria are subjective in nature, the Company currently estimates that approximately 110 employees and consultants are likely to be eligible to receive awards each year under the 1999 LTIP. It is not possible to determine the benefits or amounts to be received under the 1999 LTIP because all amounts to be received will be based solely on future performance. The maximum aggregate number of shares of Common Stock which are available for the grant of awards under the 1999 LTIP shall not exceed 1,000,000 shares of Common Stock, adjusted for any stock dividend or split, recapitalization, merger or any similar change. Notwithstanding the foregoing, in no event shall more than 400,000 shares of Common Stock (subject to adjustment in accordance with the preceding sentence) be available for the issuance of Common Stock pursuant to performance shares and restricted stock awards. On March 31, 1999, the closing price of the Common Stock on the Nasdaq Stock Market was $31 per share. Stock Options. Stock options entitle the holder to purchase shares of Common Stock at a per share price determined by the Stock Option Committee which price will not be less than the closing price of Common Stock on the Nasdaq Stock Market (or, if applicable, on the principal securities exchange on which such shares of Common Stock are traded) on the date of grant ("Fair Market Value"). Stock options will be exercisable for such period as is determined by the Stock Option Committee, but in no event may options be exercisable after 10 years from the date of grant. The Stock Option Committee may permit an employee or a consultant who has received a grant of nonstatutory stock options to transfer the options, subject to such terms and conditions specified by the Stock Option Committee, to the employee's or consultant's spouse and issue (including adopted and step-children) or to a trust for the benefit of the employee or consultant and such family members. No employee or consultant may receive stock option grants under the Plan for more than 200,000 shares of Common Stock in any 12 month period. Upon the grant or exercise of an incentive stock option, no income will be realized by the optionee for Federal income tax purposes and the Company will not be entitled to any deduction. If the Common Stock acquired upon exercise is not disposed of within the one-year period beginning on the date of the transfer of the Common Stock to the optionee, nor within the two-year period beginning on the date of the grant of the option, any gain or loss realized by the optionee upon the disposition of such shares will be taxed as long-term capital gain or loss. In such event, no deduction will be allowed to the Company. If the Common Stock is disposed of within the one-year or two-year periods referred to above, the optionee will realize ordinary income at the time of disposition in an amount equal to the excess of the Fair Market Value of the Common Stock on the date of exercise (or, if less, the net proceeds of the disposition) over the exercise price, and the Company will be entitled to a corresponding deduction. -21- Upon the grant of a nonstatutory option, no income will be realized by the optionee for Federal income tax purposes, and the Company will not be entitled to any deduction. Upon the exercise of such an option, the optionee will realize ordinary income in the amount by which the Fair Market Value of the Common Stock at the time of exercise exceeds the exercise price, and the Company will be entitled to a corresponding deduction. The Stock Option Committee may permit an optionee to satisfy the Company's obligation to withhold required taxes upon the exercise of a nonstatutory option by having the Company retain the number of shares of Common Stock, the Fair Market Value of which is equal to the required withholding amount. Performance Shares. Performance share awards consist of a grant of actual shares of Common Stock or share units having a value equal to an identical number of shares of Common Stock. The number of shares of Common Stock or share units to which the holder is entitled is based upon performance conditions of the Company over a performance period (which in no event may be less than twelve months) as determined by the Stock Option Committee. Performance share awards may provide the holder with dividends or dividend equivalents and voting rights prior to vesting. The Stock Option Committee will determine whether performance shares granted in the form of share units shall be paid in cash, Common Stock or a combination thereof. Awards of performance shares to the Chief Executive Officer and the employees whom the Stock Option Committee considers likely to be among the four most highly compensated executive officers for the year in which an award is made or payable shall, except to the extent determined otherwise by the Stock Option Committee, be subject to performance conditions. The conditions must be established within 90 days after the start of the performance period and be based on the achievement by the Company or, if applicable, a business unit of a specified target operating or net income, earnings per share, return on assets, return on equity, any combination of the foregoing, or on the achievement of a targeted shareholder return. The Stock Option Committee may reduce or eliminate an award of performance shares to such officers, notwithstanding the achievement of a specified target. The maximum number of performance shares subject to any award under the Plan to such an officer is 200,000 for each twelve months during the performance period; to the extent the award is paid in cash, the maximum is the cash value of such shares at the closing price on the Common Stock's last trading day on the Nasdaq Stock Market or, if applicable, the principal securities exchange on which such shares of Common Stock are traded during the period. If such an officer terminates employment for any reason during the period, the award will be payable to the extent determined by the Stock Option Committee if the performance conditions are achieved. Stock Appreciation Rights. Stock appreciation rights ("SARs") may be granted under the Plan to provide holders of options granted under the Plan with an alternative method of realizing the benefits of those options. Upon exercise of a SAR and surrender of the related option, the Company will pay to the holder of the SAR an amount equal to 100%, or such lesser percentage as the Committee may determine, of the excess of (a) the fair market value of the shares of Common Stock subject to the related option on the date the SAR is exercised over (b) the exercise price for those shares of Common Stock (the "spread"). This amount is payable by the Company at the time of exercise in cash, in shares of Common Stock, or in any combination of cash and shares of Common Stock, as determined by the Committee. SARs may be exercised only at a time and to the same extent as the related option is exercisable. Upon exercise of a SAR, the holder of the SAR must surrender, unexercised, the related option or any applicable portion thereof. -22- Restricted Stock. Restricted stock awards consist of a grant of actual shares of Common Stock or share units having a value equal to an identical number of shares of Common Stock. Restricted stock awards may provide the holder with dividends or dividend equivalents and voting rights prior to vesting. The Stock Option Committee will determine whether restricted stock granted in the form of share units shall be paid in cash, Common Stock or a combination thereof. The conditions and the length of the period for vesting of restricted stock awards are established by the Stock Option Committee at the time of grant. A restricted period of not less than three years shall apply to all Common Stock or share units subject to restricted stock awards, except that a restricted period of less than three years may apply to such grants with respect to up to ten percent (10%) of the total shares of Common Stock available for the grant of awards under the Plan. Change in Control. In the event of a "Change in Control" (as defined in the Plan), (i) the restrictions applicable to all shares of restricted stock and restricted share units shall lapse and such shares and share units shall be deemed fully vested, (ii) all restricted stock granted in the form of share units shall be paid in cash, (iii) all performance shares granted in the form of shares of Stock or share units shall be deemed to be earned in full, (iv) all performance shares granted in the form of share units shall be paid in cash, and (v) stock options and SARs that are not exercisable in full shall be deemed fully exercisable. The amount of any cash payment in respect of a restricted share unit or performance share unit shall be equal to: (A) in the event the Change in Control is the result of a tender offer or exchange offer for Common Stock, the final offer price per share paid for the Common Stock or (B) in the event the Change in Control is the result of any other occurrence, the aggregate per share value of Common Stock as determined by the Stock Option Committee at such time. The Stock Option Committee may, in its discretion, include such further provisions and limitations in any agreement documenting such awards as it may deem equitable and in the best interests of the Company. Consistent with the Company's past practices in respect of awards under the 1983 Plan and the 1992 Plan, the 1999 LTIP expressly prohibits the repricing of any of the options or stock appreciation rights that may be granted under the 1999 LTIP, except pursuant to adjustments of and changes in the Common Stock, all as more fully described in Section 16 of the 1999 LTIP. The 1999 LTIP or any portion thereof may be amended, suspended or terminated by the Board of Directors at any time, provided that no amendment shall be made without shareholder approval if such approval is necessary for the 1999 LTIP to continue to comply with Rule 16b-3 under the Exchange Act. Unless terminated earlier by the Board of Directors, the term of the 1999 LTIP will expire on December 31, 2008. The affirmative vote of the holders of a majority of the votes cast at the meeting is necessary for adoption of the 1999 LTIP. The Board of Directors recommends a vote FOR this proposal. -23- PROPOSAL FOUR: INCREASE IN AUTHORIZED SHARES OF COMMON STOCK On March 3, 1999, the Board of Directors authorized and approved, subject to shareholder approval, an amendment to Article FOURTH of the Company's Restated Certificate of Incorporation (the "Certificate of Incorporation"), increasing the number of authorized shares of Common Stock to 100,000,000. It is contemplated that, if the proposed amendment is approved by the Company's shareholders, a Certificate of Amendment will be filed in accordance with the laws of the State of New York so as to become effective as soon as practicable thereafter. Of the 40,000,000 shares of Common Stock currently authorized, as of March 31, 1999 there were 15,201,913 shares issued and outstanding. In addition, 1,441,866 shares were reserved for issuance pursuant to the Company's existing stock option plans and the warrant issued to BMS in connection with the acquisition of Linvatec. If the 1999 Plan is adopted at the Annual Meeting as proposed, an additional 1,000,000 shares of Common Stock would be reserved for issuance under the 1999 Plan. The Board of Directors believes it to be in the best interests of the Company and its shareholders to have additional Common Stock authorized which would be available for issuance for general corporate purposes, including raising capital to support business expansion, stock splits, stock dividends, acquisitions, benefit plans or other developments which might make its issuance desirable. For example, the Company effected three-for-two stock splits in the form of stock dividends on December 27, 1994 and November 30, 1995 (issuing an aggregate of 6,680,000 shares of Common Stock). The Company believes that stock splits or stock dividends broaden the market for, and the liquidity of, the Company's Common Stock. In addition, the Company issued 1,590,000 shares of Common Stock in March 1995 in the acquisition of Birtcher Medical Systems, Inc. and issued 3,852,000 shares of Common Stock in March 1996 in a registered public offering to reduce indebtedness incurred in connection with the Company's acquisitions. The Company issued substantial indebtedness to finance the Linvatec acquisition. Additional authorized Common Stock would be available for issuances in registered public offerings to reduce such indebtedness. The issuance of additional shares of Common Stock could also be used to impede an unsolicited bid for control of the Company which the Board of Directors believed was not in the best interests of the Company or its shareholders. The availability of additional Common Stock as a defensive response to a takeover attempt was not a motivating factor in the Board's approval of the proposed amendment to Article FOURTH, and the Board is not aware of any effort to obtain control of the Company. If authorization of any increase in the Common Stock is postponed until a specific need arises, the delay and expense incident to obtaining approval of shareholders at that time could impair the Company's ability to meet its objectives. The Company does not now have any agreement, understanding, arrangement or commitment which would result in the issuance of any of the additional shares to be authorized (other than pursuant to stock options and the Linvatec warrant) and no assurance can be given at this time that additional shares will, or as to the circumstances under which such shares might, in fact be issued. No further action or authorization by the shareholders would be necessary prior to the issuance of the additional shares unless applicable laws or regulations or the rules of the Nasdaq National Market or of any stock exchange on which the Company's securities may then be listed require such approval. The additional shares authorized by the proposed amendment will have the same rights and privileges as the shares of Common Stock currently authorized and outstanding. Holders of the Company's shares have no preemptive rights and, accordingly, existing shareholders would not have any preferential right to purchase any of the additional shares when issued. Issuance of such shares, depending upon the type of transaction in which the shares are issued, could have a dilutive effect on the equity and earnings per share -24- attributable to present shareholders. Should this Proposal and also Proposal 3 be passed at the Annual Meeting, the Company will have 83,356,221 shares of Common Stock and 500,000 shares of Preferred Stock unissued and not reserved for issuance. The proposed amendment would amend the first paragraph of Article FOURTH of the Certificate of Incorporation to read in its entirety as follows: FOURTH. The aggregate number of shares of stock which the Corporation shall have the authority to issue is 100,500,000, of which 100,000,000 shares of the par value of $.01 per share shall be designated as Common Stock ("Common Stock"), and 500,000 shares of the par value of $.01 per share shall be designated as Preferred Stock ("Preferred Stock"). Language deleted by the proposed amendment has been crossed out and language added by the proposed amendment has been underlined. The rest of Article FOURTH will remain unchanged. The affirmative vote of the holders of a majority of the outstanding shares of Common Stock is necessary for approval of the proposed amendment to the Certificate of Incorporation. The Board of Directors unanimously recommends a vote FOR this proposal. OTHER BUSINESS Management knows of no other business which will be presented for consideration at the Annual Meeting, but should any other matters be brought before the meeting, it is intended that the persons named in the accompanying proxy will vote such proxy at their discretion. SHAREHOLDER PROPOSALS FOR 2000 ANNUAL MEETING Any shareholder desiring to present a proposal to the shareholders at the 2000 Annual Meeting, which currently is expected to be scheduled on or about May 16, 2000, and who desires that such proposal be included in the Company's proxy statement and proxy card relating to that meeting, must transmit such to the Company so that it is received by the Company at its principal executive offices on or before December 11, 1999. All such proposals should be in compliance with applicable SEC regulations. In addition, shareholders wishing to propose matters for consideration at the 2000 Annual Meeting or to propose nominees for election as directors at the 2000 Annual Meeting must follow specified advance notice procedures contained in the Company's By-laws, a copy of which is available on request to the Secretary of the Company, c/o CONMED Corporation, 310 Broad Street, Utica, New York 13501 (Telephone (315) 797- 8375). As of the date of this proxy statement, shareholder proposals, including director nominee proposals, must comply with the conditions set forth in Section 1.13 of the Company's By-laws and to be considered timely, notice of a proposal must be received by the Company between February 16, 2000 and March 17, 2000. By Order of the Board of Directors, Thomas M. Acey Secretary April 16, 1999 -25-


                                                   Exhibit A
                                                   1999 Long-Term Incentive Plan

                               CONMED CORPORATION

                          1999 LONG-TERM INCENTIVE PLAN

         1. PURPOSE.  The purpose of the 1999 Long-Term Incentive Plan of CONMED
Corporation  (the  "Plan") is to promote the long term  financial  interests  of
CONMED  Corporation  (the "Company"),  including its growth and performance,  by
encouraging  employees of the Company and its  subsidiaries  and consultants who
provide  important  services to the Company and its  subsidiaries  to acquire an
ownership position in the Company,  enhancing the ability of the Company and its
subsidiaries  to attract and retain  employees and  consultants  of  outstanding
ability, and providing employees and consultants with an interest in the Company
parallel to that of the Company's  shareholders.  To achieve these purposes, the
Company  may grant  Awards of options,  restricted  shares,  stock  appreciation
rights and performance  shares to key employees and consultants  selected by the
Stock Option  Committee,  all in accordance  with the terms and  conditions  set
forth in the Plan.

         2. DEFINITIONS. The following definitions are applicable to the Plan:

         "Award" shall mean an award  determined in accordance with the terms of
the Plan.

         "Board of Directors" shall mean the Board of Directors of the Company.

         "Committee"  shall  mean the  Stock  Option  Committee  of the Board of
Directors. The Committee shall be composed of not less than two directors of the
Company.  The Board of  Directors  may also  appoint  one or more  directors  as
alternate members of the Committee.  No officer or employee of the Company or of
any  subsidiary  shall be a member or  alternate  member of the  Committee.  The
Committee shall at all times be comprised solely of "outside  directors"  within
the meaning of Section 162(m) of the Internal  Revenue Code and in such a manner
as to satisfy  the  "non-employee"  director  standard  contained  in Rule 16b-3
promulgated under the Exchange Act.

         "Common  Stock" shall mean the common stock,  par value $.01 per share,
of the Company.

         "Covered  Employee"  means, at the time of an Award (or such other time
as required or permitted by Section 162(m) of the Internal Revenue Code) (i) the
Company's  Chief Executive  Officer (or an individual  acting in such capacity),
(ii) any employee of the Company or its  subsidiaries  who, in the discretion of
the  Committee  for purposes of  determining  those  employees  who are "covered
employees"  under Section  162(m) of the Internal  Revenue Code, is likely to be
among the four other highest compensated officers of the Company for the year in
which an Award is made or payable,  and (iii) any other  employee of the Company
or its subsidiaries designated by the Committee in its discretion.

         "Exchange  Act"  shall mean the  Securities  Exchange  Act of 1934,  as
amended.

         "Fair Market Value" shall mean, per share of Common Stock,  the closing
price of the Common Stock on the Nasdaq Stock Market of the National Association
of Securities Dealers,  Inc. (the "Nasdaq Stock Market") on the applicable date,
or, if the shares of Common Stock of the Company are then listed on a securities
exchange,  the closing  price of the Common  Stock on the  principal  securities
exchange  on which  such  shares are then  traded,  or, if there are no sales of
Common Stock on the Nasdaq Stock Market or such  principal  securities  exchange
(as applicable) on such date, then the closing price of the Common Stock on

                                       A-1





the  last  previous  day on  which a sale on the  Nasdaq  Stock  Market  or such
principal securities exchange (as applicable) is reported.

         "Internal  Revenue  Code" means the Internal  Revenue Code of 1986,  as
amended.

         "Participant"  shall mean an employee of the Company or any  subsidiary
or a consultant  who is party to a consulting  agreement with the Company or any
subsidiary,  in each case who is selected by the Committee to participate in the
Plan.

         3. SHARES  SUBJECT TO THE PLAN.  Subject to  adjustment  as provided in
Section 16 of this Plan,  the number of shares of Common  Stock  which  shall be
available  for the grant of Awards  under the Plan shall not  exceed  1,000,000.
Notwithstanding  anything  contained  herein to the contrary,  in no event shall
more than 400,000  shares of Common Stock  (subject to adjustment as provided in
Section 16 of this Plan) be  available  in the  aggregate  for the  issuance  of
Common Stock pursuant to performance  shares and restricted  stock granted under
the Plan. The shares of Common Stock issued under the Plan may be authorized and
unissued  shares,  treasury  shares  or  shares  acquired  in  the  open  market
specifically  for  distribution  under the Plan, as the Company may from time to
time determine.

         Shares of Common  Stock  subject to an Award  under the Plan  that,  in
whole  or in part,  expires  unexercised  or that is  forfeited,  terminated  or
canceled  or is paid in cash in lieu of Common  Stock,  shares  of Common  Stock
surrendered or withheld from any Award under the Plan to satisfy a Participant's
income  tax  withholding  obligation  and  shares of Common  Stock  owned by the
Participant  that are  tendered to pay for the  exercise of a stock option under
the Plan shall thereafter again be available for grant under the Plan.

         4. ADMINISTRATION.  The Plan shall be administered by the Committee.  A
majority of the Committee shall constitute a quorum,  and the acts of a majority
shall be the acts of the Committee.  Any  determination  of the Committee may be
made,  without a meeting,  by a writing or writings signed by all of the members
of the  Committee.  In addition,  the Committee may authorize any one or more of
their  number or any officer of the Company to execute and deliver  documents on
behalf of the Committee and the Committee may delegate to one or more employees,
agents or officers of the  Company,  or to one or more third party  consultants,
accountants,  lawyers or other advisors,  such ministerial duties related to the
operation of the Plan as it may deem appropriate.

         Subject  to the  provisions  of the  Plan,  the  Committee  (i) (or its
delegate,   within  limits  established  by  the  Committee,   with  respect  to
non-Covered  Employees  and  employees  who are not subject to Section 16 of the
Exchange Act) shall select the Participants,  determine the type, size and terms
of Awards  to be made to  Participants,  determine  the  shares  or share  units
subject  to  Awards,  the  restrictions,  conditions  and  contingencies  to  be
applicable in the case of specific Awards, and the time or times at which Awards
shall be exercisable  or at which  restrictions,  conditions  and  contingencies
shall  lapse,  and (ii) shall  have the  authority  to  interpret  the Plan,  to
establish,  amend and rescind any rules and regulations relating to the Plan, to
determine the terms and provisions of any agreements entered into hereunder, and
to make all other  determinations  necessary or advisable for the administration
of the Plan.  The  Committee  may  correct any  defect,  supply any  omission or
reconcile any inconsistency in the Plan or in any Award in the manner and to the
extent it shall deem desirable to carry it into effect.  The  determinations  of
the Committee in the  administration of the Plan, as described herein,  shall be
final and  conclusive.  No member or alternate  member of the Committee shall be
liable for any such action or determination made in good faith.

                                       A-2







         5.  ELIGIBILITY.  All employees of the Company and its subsidiaries and
consultants  who are parties to consultancy  agreements  with the Company or any
subsidiary,  in each case who have demonstrated significant management potential
or who have the  capacity  for  contributing  in a  substantial  measure  to the
successful  performance  of the Company,  as  determined by the Committee in its
sole discretion,  are eligible to be Participants in the Plan. In addition,  the
Committee  may from time to time deem  other  employees  of the  Company  or its
subsidiaries  or  consultants  eligible  to  participate  in the Plan to receive
awards of nonstatutory stock options. The granting of any Award to a Participant
shall not entitle that  Participant  to, nor disqualify that  Participant  from,
participation in any other grant of an Award.

         6. AWARDS.  Awards under the Plan may consist of: stock options (either
incentive  stock  options  within the  meaning of  Section  422 of the  Internal
Revenue  Code  or  nonstatutory  stock  options),   performance  shares,   stock
appreciation  rights and restricted stock grants.  Awards of performance  shares
and  restricted  stock may provide the  Participant  with  dividends or dividend
equivalents  and voting  rights prior to vesting  (whether  based on a period of
time or based on attainment of specified performance conditions).

         7. STOCK OPTIONS.  The award instrument pursuant to which any incentive
stock option is granted shall specify that the option  granted  thereby shall be
treated as an incentive stock option. The award instrument pursuant to which any
nonstatutory  stock  option is granted  shall  specify  that the option  granted
thereby shall not be treated as an incentive  stock option.  The Committee shall
establish the option price at the time each stock option is granted, which price
shall not be less than 100% of the Fair Market  Value of the Common Stock on the
date of grant.  Stock options shall be exercisable  for such period as specified
by the  Committee,  but in no event may options be  exercisable  for a period of
more than ten years after their date of grant. The option price of each share as
to which a stock option is  exercised  shall be paid in full at the time of such
exercise.  Such  payment  shall be made in cash,  by  tender of shares of Common
Stock owned by the  Participant  valued at Fair  Market  Value as of the date of
exercise,  subject  to such  guidelines  for the  tender of Common  Stock as the
Committee may  establish,  in such other  consideration  as the Committee  deems
appropriate,  or by a combination of cash, shares of Common Stock and such other
consideration. The Committee, in its sole discretion, may grant to a Participant
the right to transfer  Common  Stock  acquired  upon the exercise of a part of a
stock option in payment of the exercise price payable upon immediate exercise of
a further  part of the stock  option.  In no event may any  Participant  receive
stock options under the Plan with respect to more than 200,000  shares of Common
Stock in any 12 month period.

         8. PERFORMANCE SHARES. Performance shares may be granted in the form of
actual  shares  of  Common  Stock or  share  units  having  a value  equal to an
identical  number  of  shares  of  Common  Stock.  In the  event  that  a  stock
certificate is issued in respect of performance  shares,  such certificate shall
be  registered in the name of the  Participant  but shall be held by the Company
until the time the performance shares are earned. The performance conditions and
the length of the performance period shall be determined by the Committee but in
no event may a  performance  period be less than twelve  months.  The  Committee
shall determine in its sole discretion whether performance shares granted in the
form of share units shall be paid in cash,  Common Stock,  or a  combination  of
cash and Common Stock.

         Awards of  performance  shares to a Covered  Employee shall (unless the
Committee  determines  otherwise) be subject to performance  conditions based on
the  achievement  (i) by the Company or a business  unit of a  specified  target
operating  or net income or return on assets,  (ii) by the Company or a business
unit of  specified  target  earnings  per share or return on equity,  (iii) of a
targeted total shareholder  return or (iv) any combination of the conditions set
forth in clauses (i), (ii) and (iii) above. If an Award of performance shares is
made on such basis,  the  Committee  shall  establish  the relevant  performance
conditions  within 90 days after the commencement of the performance  period (or
such  later  date as may be  required  or  permitted  by  Section  162(m) of the
Internal  Revenue  Code).  The  Committee  may,  in its  discretion,  reduce  or
eliminate the amount of payment with respect to an Award of  performance  shares
to  a  Covered  Employee,   notwithstanding   the  achievement  of  a  specified
performance condition. The maximum number of

                                       A-3





performance  shares subject to any Award under the Plan to a Covered Employee is
200,000 for each twelve months during the performance  period (or, to the extent
the Award is paid in cash,  the maximum  dollar  amount of any such Award is the
equivalent  cash value of such number of Shares at the closing price on the last
trading  day  of the  performance  period).  For  purposes  of  the  immediately
preceding  sentence,  "trading  day"  shall  mean a day in which the  Shares are
traded on the Nasdaq Stock Market or, if  applicable,  the principal  securities
exchange  on which  the  shares of Common  Stock  are then  traded.  An Award of
performance  shares to a Participant who is a Covered Employee shall (unless the
Committee  determines  otherwise) provide that in the event of the Participant's
termination  of employment  prior to the end of the  performance  period for any
reason,  such  Award  will be  payable  only (A) if the  applicable  performance
conditions  are achieved and (B) to the extent,  if any, as the Committee  shall
determine.

         9. STOCK APPRECIATION RIGHTS. Stock Appreciation Rights ("SARs") may be
granted only in connection with a stock option. A SAR granted in connection with
an incentive stock option may be granted only when the incentive stock option is
granted.  A SAR granted in connection  with a  nonstatutory  stock option may be
granted either when the related  nonstatutory  stock option is granted or at any
time  thereafter,  including,  in the  case  of any  nonstatutory  stock  option
resulting  from the  conversion of an incentive  stock option to a  nonstatutory
stock  option,  simultaneously  with or  after  the  conversion.  A  Participant
electing to exercise a SAR shall  deliver  written  notice to the Company of the
election  identifying  the SAR and the related  option with respect to which the
SAR was granted to the Participant, and specifying the number of whole shares of
Common Stock with respect to which the  Participant  is exercising the SAR. Upon
exercise of the SAR, the related option shall be deemed to be surrendered to the
extent that the SAR is exercised.  SARs may be exercised only (i) on a date when
the Fair Market  Value of a share of Common  Stock  exceeds the  exercise  price
stated in the stock option  related to that SAR,  (ii) at a time and to the same
extent as the related  stock  option is  exercisable,  (iii) by surrender to the
Company,  unexercised,  of the related  stock option or any  applicable  portion
thereof,  and (iv) in compliance with any restrictions  that may be set forth in
the Award  agreement  pursuant to which the SAR was granted.  The amount payable
upon exercise of a SAR may be paid by the Company in cash,  or, if the Committee
shall  determine  in its sole  discretion,  in shares of Common  Stock (taken at
their Fair Market Value at the time of exercise of the SAR) or in a  combination
of cash and shares of Common Stock;  provided,  however,  that in no event shall
the total  number of shares of Common  Stock  that may be paid to a  Participant
pursuant to the  exercise  of a SAR exceed the total  number of shares of Common
Stock  subject to the related  stock  option.  A SAR shall  terminate and may no
longer be exercised  upon the first to occur of (a) exercise or  termination  of
the related stock option or (b) any termination  date specified by the Committee
at the time of grant of the SAR. In  addition,  the  Committee  may, in its sole
discretion  at any time before the  occurrence  of a Change of  Control,  amend,
suspend,  or terminate  any SAR  theretofore  granted under the Plan without the
holder's consent;  provided that, in the case of amendment,  no provision of the
SAR,  as amended,  shall be in  conflict  with any  provision  of the Plan.  The
amendment,  suspension,  or termination of any SAR by the Committee as described
in the  immediately  preceding  sentence shall not affect the holder's rights in
any related stock option.

         10.  RESTRICTED  STOCK.  Restricted stock may be granted in the form of
actual  shares  of  Common  Stock or  share  units  having  a value  equal to an
identical  number  of  shares  of  Common  Stock.  In the  event  that  a  stock
certificate is issued in respect of restricted  stock, such certificate shall be
registered in the name of the Participant but shall be held by the Company until
the end of the restricted  period.  The employment  conditions and the length of
the period for vesting of restricted stock shall be established by the Committee
at time of grant.  A restricted  period of not less than three years shall apply
to shares of Common  Stock  subject to  restricted  stock grants under the Plan,
except  that a  restricted  period  of less than  three  years may apply to such
grants  with  respect to up to ten percent  (10%) of the total  shares of Common
Stock  available  for the grant of Awards under the Plan.  The  Committee  shall
determine in its sole discretion whether restricted stock granted in the form of
share units shall be paid in cash,  Common Stock,  or a combination  of cash and
Common Stock.

                                       A-4





         11. AWARD  AGREEMENTS.  Each Award under the Plan shall be evidenced by
an  agreement  setting  forth the terms and  conditions,  as  determined  by the
Committee,  which  shall  apply to such  Award,  in  addition  to the  terms and
conditions specified in the Plan.

         12.  CHANGE  IN  CONTROL.  In the  event of a  Change  in  Control,  as
hereinafter defined, (i) the restrictions applicable to all shares of restricted
stock and  restricted  share  units  shall lapse and such shares and share units
shall be deemed fully vested,  (ii) all restricted  stock granted in the form of
share units shall be paid in cash,  (iii) all performance  shares granted in the
form of shares of Common  Stock or share  units  shall be deemed to be earned in
full,  (iv) all  performance  shares granted in the form of share units shall be
paid in cash,  and (v) each a stock  option and SAR that is not  exercisable  in
full shall be deemed fully vested.  The amount of any cash payment in respect of
a restricted share unit or performance  share unit shall be equal to: (A) in the
event the Change in Control is the result of a tender  offer or  exchange  offer
for Common  Stock,  the final offer price per share paid for the Common Stock or
(B) in the event the Change in  Control  is the result of any other  occurrence,
the  aggregate per share value of Common Stock as determined by the Committee at
such time. The Committee may, in its discretion, include such further provisions
and  limitations  in any  agreement  documenting  such  Awards  as it  may  deem
equitable and in the best interests of the Company.

         A "Change  in  Control"  shall  mean the  occurrence  of any one of the
following  events:  (i) any "person" (as such term is defined in Section 3(a)(9)
of the  Exchange  Act and as used  in  Sections  13(d)(3)  and  14(d)(2)  of the
Exchange Act) is or becomes a "beneficial owner" (as defined in Rule 13d-3 under
the  Exchange  Act),  directly  or  indirectly,  of  securities  of the  Company
representing  25% or more of the  combined  voting power of the  Company's  then
outstanding  securities  eligible  to vote  for the  election  of the  Board  of
Directors (the "Company Voting Securities");  provided,  however, that the event
described in this paragraph (i) shall not be deemed to be a Change in Control by
virtue of any of the  following  acquisitions:  (A) by the Company or any of its
subsidiaries,  (B) by any employee  benefit plan  sponsored or maintained by the
Company or any of its subsidiaries,  (C) by any underwriter  temporarily holding
securities  pursuant  to an offering of such  securities,  or (D)  pursuant to a
Non-Control  Transaction  (as defined in clause  (iii)  below),  (ii) during any
period of not more  than two  years,  individuals  who  constitute  the Board of
Directors  of the  Company as of the  beginning  of the period  (the  "Incumbent
Directors")  cease for any reason to constitute at least a majority of the Board
of  Directors,  provided that any person  becoming a director  subsequent to the
beginning of the period;  whose election or nomination for election was approved
by a vote  (either by a specific  vote or by approval of the proxy  statement of
the  Company in which such person is named as a nominee  for  director,  without
objection  to such  nomination)  of at  least  three-quarters  of the  Incumbent
Directors who remain on the Board of Directors,  including those directors whose
election or nomination  for election was  previously so approved,  shall also be
deemed  to be an  Incumbent  Director;  provided,  however,  that no  individual
initially  elected or  nominated  as a director of the Company as a result of an
actual or  threatened  election  contest  with respect to directors or any other
actual or threatened  solicitation of proxies or consents by or on behalf of any
person  other  than the Board of  Directors  shall be deemed to be an  Incumbent
Director; (iii) the consummation of a merger,  consolidation,  share exchange or
similar  form of  corporate  reorganization  of the Company (or any such type of
transaction  involving the Company or any of its subsidiaries  that requires the
approval  of the  Company's  shareholders,  whether for the  transaction  or the
issuance  of   securities  in  the   transaction   or  otherwise)  (a  "Business
Combination"),  unless immediately following such Business Combination: (a) more
than 60% of the  total  voting  power of the  corporation  resulting  from  such
Business  Combination  (including,  without  limitation,  any corporation  which
directly or indirectly  has  beneficial  ownership of 100% of the Company Voting
Securities)  eligible to elect  directors of such  corporation is represented by
shares that were Company Voting  Securities  immediately  prior to such Business
Combination  (either by  remaining  outstanding  or being  converted),  and such
voting power is in substantially the same proportion as the voting power of such
Company Voting Securities immediately prior to the Business Combination,  (b) no
person (other than any holding company resulting from such Business Combination,
any employee benefit plan sponsored or maintained by the Company (or

                                       A-5







the corporation resulting from such Business Combination)) immediately following
the  consummation  of the Business  Combination  becomes the  beneficial  owner,
directly  or  indirectly,  of 25% or  more  of the  total  voting  power  of the
outstanding  voting  securities  eligible to elect  directors of the corporation
resulting  from such  Business  Combination,  and (c) at least a majority of the
members  of the  board of  directors  of the  corporation  resulting  from  such
Business Combination were Incumbent Directors at the time of the approval of the
execution of the initial agreement providing for such Business  Combination (any
Business  Combination which satisfies the conditions in clauses (a), (b) and (c)
is  referred  to  hereunder  as  a  "Non-Control  Transaction");   or  (iv)  the
shareholders  of  the  Company  approve  a  plan  of  complete   liquidation  or
dissolution  of the  Company  or the  sale  of all or  substantially  all of its
assets.  Notwithstanding the foregoing, a Change in Control of the Company shall
not be deemed to occur solely because any person acquires  beneficial  ownership
of more than 25% of the Company Voting Securities as a result of the acquisition
of Company Voting  Securities by the Company which reduces the number of Company
Voting Securities  outstanding;  provided, that if after such acquisition by the
Company such person  becomes the beneficial  owner of additional  Company Voting
Securities   that  increases  the  percentage  of  outstanding   Company  Voting
Securities beneficially owned by such person, a Change in Control of the Company
shall then occur.

         13.  WITHHOLDING.  The Company  shall have the right to deduct from any
payment to be made pursuant to the Plan the amount of any taxes  required by law
to be withheld therefrom, or to require a Participant to pay to the Company such
amount  required to be withheld  prior to the issuance or delivery of any shares
of Common Stock or the payment of cash under the Plan. The Committee may, in its
discretion, permit a Participant to elect to satisfy such withholding obligation
by having the  Company  retain the number of shares of Common  Stock  whose Fair
Market Value equals the amount required to be withheld.  Any fraction of a share
of Common Stock required to satisfy such obligation shall be disregarded and the
amount due shall instead be paid in cash to the Participant.

         14.  NONTRANSFERABILITY.  No Award shall be assignable or transferable,
and no right or  interest  of any  Participant  shall be  subject  to any  lien,
obligation  or  liability  of the  Participant,  except  by will or the  laws of
descent and distribution.  Notwithstanding  the immediately  preceding sentence,
the Committee may, subject to the terms and conditions it may specify,  permit a
Participant to transfer any  nonstatutory  stock options granted to him pursuant
to the  Plan  to one or  more  of his  immediate  family  members  or to  trusts
established in whole or in part for the benefit of the Participant and/or one or
more of such immediate family members. During the lifetime of the Participant, a
nonstatutory stock option shall be exercisable only by the Participant or by the
immediate  family member or trust to whom such stock option has been transferred
pursuant to the immediately  preceding  sentence.  For purposes of the Plan, (i)
the term  "immediate  family"  shall  mean the  Participant's  spouse  and issue
(including  adopted and step  children)  and (ii) the phrase  "immediate  family
members  and  trusts  established  in whole or in part  for the  benefit  of the
Participant  and/or  one or more of such  immediate  family  members"  shall  be
further  limited,  if necessary,  so that neither the transfer of a nonstatutory
stock  option to such  immediate  family  member or trust,  nor the ability of a
Participant  to make such a transfer  shall  have  adverse  consequences  to the
Company or the  Participant by reason of Section 162(m) of the Internal  Revenue
Code.

                                       A-6







         15. NO RIGHT TO  EMPLOYMENT  OR  CONSULTANCY.  No person shall have any
claim or right to be  granted an Award,  and the grant of an Award  shall not be
construed as giving a Participant  the right to be retained in the employ of the
Company or any  subsidiary  or retained as a consultant  with the Company or any
subsidiary.  Further,  the Company and its  subsidiaries  expressly  reserve the
right at any time to dismiss a Participant free from any liability, or any claim
under the Plan,  except as  provided  herein or in any  agreement  entered  into
hereunder.  Any  obligation of the Company under the Plan to make any payment at
any future date merely  constitutes the unsecured promise of the Company to make
such  payment  from its  general  assets in  accordance  with the  Plan,  and no
Participant  shall  have any  interest  in,  or lien or prior  claim  upon,  any
property of the Company or any subsidiary by reason of that obligation.

         16.  ADJUSTMENT  OF AND  CHANGES IN COMMON  STOCK.  In the event of any
change in the outstanding shares of Common Stock by reason of any stock dividend
or split,  recapitalization,  merger,  consolidation,  spinoff,  combination  or
exchange of shares or other corporate  change,  or any  distributions  to common
shareholders  other than regular cash  dividends,  the  Committee  may make such
substitution  or  adjustment,  if any,  as it deems to be  equitable,  as to the
number or kind of shares of Common Stock or other securities  issued or reserved
for issuance pursuant to the Plan and outstanding Awards (including  adjustments
to the option and exercise prices of outstanding Awards). Except pursuant to the
previous sentence, the option or exercise price of outstanding Awards may not be
reduced.

         17. AMENDMENT.  The Board of Directors may amend,  suspend or terminate
the Plan or any portion thereof at any time, provided that no amendment shall be
made without shareholder approval if such approval is necessary in order for the
Plan to continue to comply with Rule 16b-3 under the Exchange Act.

         18. EFFECTIVE DATE AND  TERMINATION.  The Plan shall be effective as of
January 1, 1999, subject to its approval by shareholders of the Company. Subject
to earlier  termination  pursuant to Section 16 of this Plan or by the action of
the Board of Directors, the Plan shall remain in effect until December 31, 2008.

         19.  PURCHASE  FOR  INVESTMENT.  Each  person  acquiring  Common  Stock
pursuant to any Award may be required by the Company to furnish a representation
that he or she is acquiring  the Common Stock so acquired as an  investment  and
not with a view to distribution  thereof if the Company, in its sole discretion,
determines that such representation is required to ensure that a resale or other
disposition  of the Common Stock would not involve a violation of the Securities
Act of 1933,  as  amended,  or of  applicable  blue  sky  laws.  Any  investment
representation  so  furnished  shall no  longer be  applicable  at any time such
representation is no longer necessary for such purposes.

         20.  AWARDS IN  SUBSTITUTION  FOR AWARDS  GRANTED  BY OTHER  COMPANIES.
Awards  may be  granted  under  the  Plan in  substitution  for  awards  held by
employees of a company who become  employees of the Company or any subsidiary as
a result of the merger or consolidation of the employer company with the Company
or any  subsidiary,  or the  acquisition by the Company or any subsidiary of the
assets  of the  employer  company,  or the  acquisition  by the  Company  or any
subsidiary  of stock of the  employer  company as a result of which it becomes a
subsidiary.  The terms,  provisions,  and benefits of the  substitute  Awards so
granted  may vary  from the  terms,  provisions,  and  benefits  set forth in or
authorized  by the Plan to such extent as the Committee at the time of the grant
may deem appropriate to conform, in whole or in part, to the terms,  provisions,
and benefits of the awards in substitution for which they are granted.

         21.  GOVERNING  LAW. The  provisions  of the Plan shall be governed and
construed in accordance with the laws of the State of New York.

                                       A-7







                               CONMED CORPORATION
                     310 Broad Street--Utica, New York 13501
                  Annual Meeting of Shareholders--May 18, 1999

           THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

         The  undersigned  hereby  appoints  Eugene R.  Corasanti  and Robert E.
Remmell,  and  either of them,  proxies of the  undersigned,  with full power of
substitution,  to vote all the shares of Common Stock of CONMED Corporation (the
"Company")  held of record by the  undersigned  on March 31, 1999, at the Annual
Meeting of Shareholders to be held May 18, 1999, and at any adjournment thereof.

     (1)  Election of Directors

     [_] FOR all nominees listed below         [_] WITHHOLD AUTHORITY to vote
         (except as indicated otherwise            for all nominees listed below
         below)

         NOMINEES:  Eugene R.  Corasanti,  Robert E. Remmell,  Bruce F. Daniels,
                    William  D.  Matthews,  Stuart  J.  Schwartz  and  Joseph J.
                    Corasanti.

         INSTRUCTIONS:  To  withhold   authority  to  vote  for  any  individual
                        nominee, write that nominee's name on the space provided
                        below.

- --------------------------------------------------------------------------------

     (2)  Appointment of  PricewaterhouseCoopers  LLP as independent accountants
          of the Company for 1999.

                   [_]  FOR      [_]  AGAINST       [_]  ABSTAIN

     (3)  Approval of the Company's 1999 Long-Term Incentive Stock Plan.

                   [_]  FOR      [_]  AGAINST       [_]  ABSTAIN

     (4)  Approval  of  Amendment  to  the  Company's  Restated  Certificate  of
          Incorporation  to increase  to  100,000,000  the number of  authorized
          shares of Common Stock.

                   [_]  FOR      [_]  AGAINST       [_]  ABSTAIN

     (5)  In their discretion the proxies are authorized to vote upon such other
          matters as may come before the meeting or any adjournment thereof.

         All as more  particularly  described in the Company's Proxy  Statement,
dated  April 16,  1999  (the  "Company's  Proxy  Statement"),  relating  to such
meeting, receipt of which is hereby acknowledged.






         THIS PROXY WHEN  PROPERLY  EXECUTED  WILL BE VOTED AS  SPECIFIED BY THE
UNDERSIGNED  SHAREHOLDER.  IF NO CHOICE IS  SPECIFIED BY THE  SHAREHOLDER,  THIS
PROXY WILL BE VOTED "FOR" ALL  PORTIONS OF ITEMS (1),  (2),  (3) (SUBJECT TO THE
LIMITATION CONTAINED ON PAGE 2 OF THE COMPANY'S PROXY STATEMENT) AND (4), AND IN
THE PROXIES' DISCRETION ON ANY OTHER MATTERS COMING BEFORE THE MEETING.

         The undersigned hereby revokes any proxy or proxies heretofore given to
vote upon or act with respect to such stock and hereby ratifies and confirms all
that said proxies,  their  substitutes  or any of them may lawfully do by virtue
hereof.

                                            ------------------------------------

                                            ------------------------------------

                                            Dated:------------------------, 1999

                                            Please date this Proxy Card and sign
                                            your  name  exactly  as  it  appears
                                            hereon. Where there is more than one
                                            owner,   each  should   sign.   When
                                            signing     as     an      attorney,
                                            administrator,  executor,  guardian,
                                            or trustee, please add your title as
                                            such. If executed by a  corporation,
                                            this Proxy Card  should be signed by
                                            a  duly   authorized   officer.   If
                                            executed  by a  partnership,  please
                                            sign   in   partnership    name   by
                                            authorized persons.

Please  promptly  mark,  date,  sign and mail
this Proxy Card in the enclosed envelope.  No
postage is required.