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Table of Contents
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☐
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Preliminary Proxy Statement | |||
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Confidential, for Use of the Commission
Only
(as permitted by Rule 14a-6(e)(2))
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☒
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Definitive Proxy Statement | |||
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☐
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Definitive Additional Materials | |||
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☐
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Soliciting Material under Section 240.14a-2. | |||
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than Registrant)
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| Payment of Filing Fee (Check the appropriate box): | ||||
| ☒ | No fee required. | |||
| ☐ | Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11 | |||
| ☐ | Fee paid previously with preliminary materials. | |||
Table of Contents
Table of Contents
Notice of 2024 Annual Meeting of Shareholders
May 3, 2024
9:00 a.m. Central Time
Westin Chicago Lombard
70 Yorktown Center
Lombard, Illinois 60148
Dear Fellow Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders (the “Annual Meeting”) of Dover Corporation (“Dover” or the “Company”) at The Westin Chicago Lombard on May 3, 2024, at 9:00 a.m., Central Time, to be held for the following purposes:
| 1. |
To elect ten directors. |
| 2. |
To ratify the appointment of PricewaterhouseCoopers LLP (“PwC”) as our independent registered public accounting firm for 2024. |
| 3. |
To approve, on an advisory basis, named executive officer (“NEO”) compensation. |
| 4. |
To approve an amendment to the Company’s Fifth Restated Certificate of Incorporation to reflect recent Delaware law provisions regarding officer exculpation. |
| 5. |
To consider such other business as may properly come before the Annual Meeting, including any adjournments or postponements thereof. |
All holders of record at the close of business on March 8, 2024, are entitled to notice of and to vote at the Annual Meeting or any adjournments or postponements thereof. Whether or not you plan to attend the Annual Meeting, we urge you to vote your shares as soon as possible.
March 21, 2024
By authority of the Board of Directors,
Ivonne M. Cabrera
Secretary
Table of Contents
TABLE OF CONTENTS
| Notice of 2024 Annual Meeting of Shareholders | ||||
| Proxy Statement Summary | 1 | |||
| 1 | ||||
| 1 | ||||
| 1 | ||||
| 2 | ||||
| 4 | ||||
| 5 | ||||
| 5 | ||||
| 6 | ||||
| 6 | ||||
| 8 | ||||
| Proposal 1 — Election of Directors | 9 | |||
| 9 | ||||
| 10 | ||||
| 11 | ||||
| 21 | ||||
| 30 | ||||
| 32 | ||||
| 35 | ||||
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Proposal 2 — Ratification of Appointment of Independent Registered Public Accounting Firm |
37 | |||
| 38 | ||||
| 39 | ||||
|
Pre-Approval of Services Provided by Independent Registered Public Accounting Firm |
39 | |||
| Compensation Discussion and Analysis | 40 | |||
| 40 | ||||
| 42 | ||||
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Dover’s Alignment with Leading Compensation Governance Practices |
43 | |||
| 44 | ||||
| 45 | ||||
| 49 | ||||
| 56 | ||||
| 58 | ||||
| 60 | ||||
| 61 | ||||
| 61 | ||||
| 63 | ||||
| 64 | ||||
| 66 | ||||
| 66 | ||||
| 68 | ||||
| 69 | ||||
| 74 | ||||
DOVER CORPORATION – 2024 Proxy Statement i
Table of Contents
TABLE OF CONTENTS
DOVER CORPORATION – 2024 Proxy Statement ii
Table of Contents
PROXY STATEMENT SUMMARY
Annual Meeting Information
| Date: | May 3, 2024 | |
| Time: | 9:00 a.m., Central Time | |
| Record Date: | March 8, 2024 | |
| Location: |
The Westin Chicago Lombard 70 Yorktown Center Lombard, Illinois 60148 |
|
| For additional information about our Annual Meeting, please see “General Information About the Annual Meeting.” We are first mailing this Notice of Annual Meeting and Proxy Statement beginning on or about March 21, 2024. | ||
Items of Business
There are four proposals to be voted on at the Annual Meeting:
|
ITEM
|
Proposal
|
Board Voting
|
Page Reference
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|||
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ITEM 1
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The election of ten nominees for director
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FOR each director
|
9 | |||
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ITEM 2
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The ratification of the appointment of PwC as our independent registered public accounting firm for 2024
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FOR
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37 | |||
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ITEM 3
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An advisory resolution to approve NEO compensation
|
FOR
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77 | |||
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ITEM 4
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The approval of an amendment to the Company’s Fifth Restated Certificate of Incorporation to reflect recent Delaware law provisions regarding officer exculpation
|
FOR
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78 | |||
How to Submit Your Proxy
Even if you plan to attend the Annual Meeting in person, please submit your proxy as soon as possible using one of the following methods:
| • |
Via internet by visiting www.proxyvote.com |
| • |
Via telephone by calling 1-800-690-6903 |
| • |
Via mail by marking, signing and dating your proxy card or voting instruction form (if you received proxy materials by mail) and returning it to the address listed therein |
DOVER CORPORATION – 2024 Proxy Statement 1
Table of Contents
PROXY STATEMENT SUMMARY
Company Overview
Dover is a diversified global manufacturer and solutions provider delivering innovative equipment and components, consumable supplies, aftermarket parts, software and digital solutions, and support services through five operating segments: Engineered Products, Clean Energy Fueling, Imaging Identification, Pumps Process Solutions, and Climate Sustainability Technologies. We combine global scale, operational agility, world-class engineering capability, and customer intimacy to lead the markets we serve. Recognized for our entrepreneurial approach for over 65 years, our team of over 25,000 employees takes an ownership mindset, collaborating with customers to redefine what’s possible.
Management Philosophy
| • |
Our executive management team is committed to steady shareholder value creation through a combination of sustained long-term profitable growth, operational excellence, superior free cash flow generation, and productive capital re-deployment while adhering to a conservative financial policy. |
| • |
Our businesses seek to be leaders in a diverse set of growing markets where customers are loyal to trusted partners and suppliers, and value product performance and differentiation driven by superior engineering, manufacturing precision, total solution development, and excellent supply chain performance. |
| • |
Our companies are long-time leaders in their respective markets and are known for their innovation, engineering capability, and customer service excellence. |
| • |
Our sustainable business practices are focused on reducing environmental impact and developing products that help our customers meet their sustainability goals. |
| • |
Our operating structure of five business segments allows for differentiated acquisition focus consistent with our portfolio and capital allocation priorities which, coupled with value-creating functional expertise at our corporate center, presents opportunities to identify and capture operating synergies, such as global sourcing and supply chain integration, centralized shared services, and cross-pollination of manufacturing best practices. |
| • |
Our executive management team sets strategic direction, initiatives and goals, provides oversight of strategy execution and achievement of these goals for our business segments, and with oversight from our Board of Directors (our “Board”), makes capital allocation decisions, including organic investment initiatives, major capital projects, acquisitions, and the return of capital to our shareholders. |
| • |
Our operating culture fosters high ethical and performance standards, values accountability, rigor, trust, inclusion, respect, and open communications, and is designed to encourage individual growth and operational effectiveness. |
DOVER CORPORATION – 2024 Proxy Statement 2
Table of Contents
PROXY STATEMENT SUMMARY
Company Goals
We are committed to driving superior shareholder return through three key tenets of our corporate strategy.
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We are committed to achieving organic sales growth above global gross domestic product growth (4% to 6% annually on average) over a long-term business cycle , absent prolonged adverse economic conditions, complemented by growth through strategic acquisitions . | |
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We are focused on improving returns on capital, as well as earnings margin , by enhancing our operational capabilities and making investments across the organization in growth capacity expansion, digital capabilities, automation, operations management, information technology, shared services, and talent. We also focus on continuous, effective cost management and productivity initiatives, including automation and digitally-supported manufacturing, supply chain optimization, e-commerce and digital go-to-market, restructuring, product complexity reduction, improved footprint utilization, strategic pricing and portfolio management. | |
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We aim to generate strong and growing free cash flow and earnings per share (“EPS”) through strong earnings performance, productivity improvements, and active working capital management. | |
We support achievement of these goals by aligning management compensation with strategic and financial objectives, actively managing our portfolio to increase enterprise scale, improving business mix over time, pursuing acquisitions that fit the characteristics of an ideal Dover business, and investing in talent development programs.
2023 Financial Results
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US GAAP |
FY2023 | FY2022 | Δ | |||||||||
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Revenue ($M) |
8,438 | 8,508 | (1)% | |||||||||
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Net earnings ($M) |
1,057 | 1,065 | (1)% | |||||||||
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Diluted EPS ($) |
7.52 | 7.42 | 1% | |||||||||
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Non-GAAP (1) |
||||||||||||
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Organic revenue change |
(1)% | |||||||||||
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Adjusted net earnings ($M) (2) |
1,237 | 1,213 | 2% | |||||||||
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Adjusted diluted EPS ($) |
8.80 | 8.45 | 4% | |||||||||
(1) Definitions and reconciliations of non-GAAP measures are included at the end of this proxy statement.
(2) Full year 2023 and 2022 adjusted net earnings exclude after tax purchase accounting expenses, disposition costs, and restructuring and other costs. Full year 2023 includes the net income tax benefit of an internal reorganization executed in 2023, and full year 2022 excludes a reduction to income taxes previously recorded related to the Tax Cuts and Jobs Act.
DOVER CORPORATION – 2024 Proxy Statement 3
Table of Contents
PROXY STATEMENT SUMMARY
2023 Performance Overview
|
Capital Return Program |
• We continued our history of providing regular capital returns to shareholders by increasing our quarterly dividend, marking our 68 th consecutive year of dividend increases .
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| Portfolio Management |
• We acquired two businesses for a total of $535.3 million , net of cash acquired and including contingent consideration. The acquisitions complement and expand upon our existing operations in our Pumps Process Solutions and Climate Sustainability Technologies segments.
• As part of the regular review of our portfolio, we entered into a definitive agreement to sell our De-Sta-Co business, which we expect to complete by the end of the first quarter of 2024.
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Strong Operational Execution and Profitability |
• Delivered strong margin improvement in 2023.
• Continued to build upon our four enterprise capabilities in support of margin expansion initiatives by (1) leveraging our Digital Labs team to improve our internal and market-facing digital capabilities, (2) improving utilization and optimization of our manufacturing footprint through centralized resources and investment , (3) driving further centralized shared services under Dover Business Services , and (4) investing in our India Innovation Center shared services with a focus on engineering capabilities.
• Continued to focus on productivity initiatives such as restructuring, supply chain optimization, automation, and product complexity reduction.
• Synergy capture from recent acquisitions presents additional margin upside.
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Cash Flow Capital Allocation Capacity |
• Our businesses generated free cash flow of approximately 14% of revenue. We are focused on the most efficient allocation of our capital to maximize returns on investment. To do this, we prioritize organic reinvestment to support growth capacity, digitization, innovation, and productivity and made $193 million in capital expenditures in 2023, representing 2.3% of revenue.
• We believe our available excess cash and leverage capacity will allow us to execute against a strong acquisition pipeline and pursue opportunistic capital return strategies.
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ESG
Initiative |
• Continued to drive progress across all of our environmental, social, and governance (“ESG”) areas of focus.
• We enhanced the scope of our disclosure by publishing our EEO-1 demographic data on our ESG website and continue to update the website with current information on eighteen topics identified as areas of focus during our initial three-year ESG plan.
• We continue to report our company-wide greenhouse gas (“GHG”) emissions and progress against our science-based targets to reduce our GHG emissions, including an absolute reduction of scope 1 and scope 2 market-based GHG emissions of 30 percent by 2030 (from a 2019 baseline year), and an absolute reduction of scope 3 GHG emissions of 15 percent by 2030 (from a 2019 baseline year).
• We continue to report our progress against our goal of reducing Total Recordable Injury Rate (“TRIR”) by 40% by 2025 (from a 2019 baseline year).
• Having completed our initial set of diversity and inclusion goals, we are assessing our next set of diversity and inclusion goals.
|
DOVER CORPORATION – 2024 Proxy Statement 4
Table of Contents
PROXY STATEMENT SUMMARY
Governance and Board Highlights
Our Board is committed to sound governance practices designed to promote the long-term interests of shareholders and strengthen Board and management accountability. Highlights include:
|
BOARD OF DIRECTORS |
GOVERNANCE HIGHLIGHTS |
|
||
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✓ Lead Independent Director
✓ 9 of our 10 directors are independent; all committee chairs and members are independent
✓ Regular executive sessions of independent directors
✓ Annual election of directors
✓ Majority voting for directors and director resignation policy in uncontested elections
✓ Comprehensive annual individual evaluations of one-third of the directors
✓ Diversity search policy for external director and Chief Executive Officer (“CEO”) searches conducted by third-party search firms
✓ Robust succession planning
|
✓ 15% ownership threshold required to call a special meeting of shareholders
✓ Proxy access right at 3%/3 years/2 or 20% of Board/20 shareholder aggregation allowance
✓ Strong share retention guidelines for directors and executive officers
✓ Executive compensation driven by pay-for-performance philosophy
✓ Executive officers not permitted to hedge or pledge company shares
✓ In 2019, achieved removal of all remaining supermajority voting provisions in our charter |
|||
Shareholder Engagement
We encourage feedback from shareholders and have a strong history of engaging with investors on a range of topics, including our executive compensation program, evolving trends and best practices. In 2023, we continued our focus on regularly engaging with shareholders. We reached out to holders of approximately 54% of our shares outstanding, and engaged with governance professionals and/or portfolio managers at investors holding approximately 27% of our shares outstanding. Our shareholder engagement team consists of senior management and has also included our Lead Independent Director (then our Chair) from time to time. During these discussions, we discussed many topics, including Board oversight and composition, our commitment to diversity and inclusion, progress on our ESG program and disclosures, our executive compensation program, and our corporate governance practices. Investors continued to express broad support for our governance structures and executive compensation program, and shared their views on matters related to diversity and inclusion and our independent, well-qualified Board. Further, investors highlighted the importance of continuing our ongoing engagement with them in the future on long-term corporate strategy and ESG initiatives. For more detailed information regarding these discussions, please see “Shareholder Engagement and History of Board Responsiveness” on page 30.
DOVER CORPORATION – 2024 Proxy Statement 5
Table of Contents
PROXY STATEMENT SUMMARY
2023 Executive Compensation Highlights
Our compensation program for executive officers is designed to emphasize performance-based compensation in alignment with our business strategy.
The following table summarizes pay mix for our CEO and other NEOs, which is highly performance-based.
|
EXECUTIVE COMPENSATION PROGRAM HIGHLIGHTS
|
|
✓ Pay-for-performance philosophy — a substantial majority of NEO pay is performance-based and tied to Dover’s stock price performance
✓ Significant portion of long-term compensation is performance-based, with long-term incentives vesting over three years subject to rigorous three-year performance period
✓ Strong share ownership guidelines for NEOs
✓ Equity awards with anti-hedging and anti-pledging provisions
✓ Investors provided with clear disclosure regarding the individual strategic objectives and financial metrics in our Executive Officer Annual Incentive Plan (“AIP”)
✓ ESG oversight incorporated into our CEO’s individual strategic objectives in the AIP
✓ Robust clawback structure
|
Director Nominees
Our Governance and Nominating Committee maintains an active and engaged Board through a robust refreshment process, which focuses on ensuring our Board has a diverse skill set that benefits from both the industry- and company-specific knowledge of our longer-tenured directors, as well as the fresh perspectives brought by our newer directors.
DOVER CORPORATION – 2024 Proxy Statement 6
Table of Contents
PROXY STATEMENT SUMMARY
Current director Stephen M. Todd is not standing for re-election and will retire from the Board effective as of the Annual Meeting. Dover expresses its appreciation to Mr. Todd for his guidance and contributions during his years of dedicated service on the Board.
| NAME | OCCUPATION | INDEPENDENT |
COMMITTEES MEMBERSHIPS* |
OTHER PUBLIC COMPANY BOARDS |
||||||
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Deborah L. DeHaas Age: 64 Director Since: 2021 |
CEO of the Corporate Leadership Center; Former Vice Chairman of Deloitte and Managing Partner of the Center for Board Effectiveness | ✓ | A, G | 1 | |||||
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H. John Gilbertson, Jr. Age: 67 Director Since: 2018 |
Retired Managing Director at Goldman Sachs | ✓ | F, G | 0 | |||||
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Kristiane C. Graham Age: 66 Director Since: 1999 |
Private Investor | ✓ | C, G | 0 | |||||
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Marc A. Howze Age: 60 Director Since: 2023 |
Former Senior Advisor, Office of the Chairman at Deere Company | ✓ | A | 1 | |||||
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Michael F. Johnston Lead Independent Director Age: 76 Director Since: 2013 |
Retired CEO of Visteon Corporation | ✓ | C, G (Chair) | 0 | |||||
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Michael Manley Age: 60 Director Since: 2023 |
CEO of AutoNation, Inc. | ✓ | A, F | 1 | |||||
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Danita K. Ostling Age: 63 Director Since: 2023 |
Former Partner at Ernst Young LLP | ✓ | A | 1 | |||||
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Eric A. Spiegel Age: 66 Director Since: 2017 |
Former President and CEO of Siemens USA; Special Advisor at Brighton Park Capital | ✓ | A, F (Chair) | 1 | |||||
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Richard J. Tobin Chair of the Board Age: 60 Director Since: 2016 |
President and CEO of Dover |
No
(CEO of Dover) |
— | 1 | |||||
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Keith E. Wandell Age: 74 Director Since: 2015 |
Former President and CEO of Harley-Davidson, Inc. | ✓ | C (Chair), F | 1 | |||||
*A = Audit Committee; C = Compensation Committee; G = Governance and Nominating Committee; F = Finance Committee
DOVER CORPORATION – 2024 Proxy Statement 7
Table of Contents
PROXY STATEMENT SUMMARY
Board Composition
Dover appointed two new directors following our 2023 Annual Meeting, Marc A. Howze and Danita K. Ostling, who bring valuable skills and also strengthen the diversity of the Board, and are submitted for the first time to shareholders for election at this ‘Annual Meeting.
Upon Mr. Todd’s retirement, the Board will have the following composition:
DOVER CORPORATION – 2024 Proxy Statement 8
Table of Contents
Proposal 1 — Election of Directors
Criteria for Director Nominees
The Board seeks to recommend qualified director nominees who, in the opinion of the Board, demonstrate the highest personal and professional integrity as well as exceptional ability and judgment, who can serve as a sounding board for our CEO on planning and policy, and who will be most effective, together with the other nominees to the Board, in collectively serving the long-term interests of all our shareholders.
Key areas of expertise for director nominees, which are reflected in our current director nominees, include:
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✓ Strategic MA
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Experience with international acquisitions, post-merger integration, and portfolio restructuring
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✓ Global Operations Management
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Experience with cross-border transactions, global market entry and expansion, and implementation of operational efficiency
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✓
Capital Markets
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Experience with capital markets and complex financing transactions
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✓
Strategy Development
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Experience with diversified manufacturing in many of the markets and product areas relevant to Dover’s businesses
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✓ Risk Management Expertise
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Experience evaluating risk management policies and procedures
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✓ Audit Corporate Governance Matters
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Experience with assurance and audit, regulation, and financial reporting
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✓ Human Capital Management
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Experience attracting, developing and retaining talent and building strong cultures
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✓ Sustainability
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Experience creating long-term value by embracing opportunities and managing risks deriving from ESG developments
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✓ Executive Leadership Experience
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Leadership experience as current or former CEOs and CFOs of global public companies
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Diversity . Our Board believes that diverse perspectives enhance its decision-making and contribute to the success of Dover. In considering diversity in selecting director nominees, the Governance and Nominating Committee gives weight to the extent to which candidates would increase the effectiveness of the Board by broadening the mix of experience, knowledge, backgrounds, skills, ages, and tenures represented among its members. Our Board has adopted a policy, reflected in our Corporate Governance Guidelines, requiring that the initial list of potential director and external CEO candidates presented by third-party search firms include qualified candidates who reflect diverse backgrounds, including diversity of gender and race or ethnicity. Our Board believes that diverse perspectives enhance its decision-making and contribute to the success of Dover.
Skills Aligned with Dover’s Strategy . The Governance and Nominating Committee also considers our current Board composition and the projected retirement date of current directors, as well as such other factors it may deem to be in the best interests of Dover and its shareholders, including a director nominee’s leadership and operating experience (particularly as a
DOVER CORPORATION – 2024 Proxy Statement 9
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
CEO), financial and investment expertise, and strategic planning experience. Given the global reach and broad array of the types of businesses operated by Dover, the Governance and Nominating Committee highly values director nominees with multi-industry and multi-geographic experience. We believe that our current director nominees possess the right mix of skills and backgrounds to enable us to achieve our strategic goals.
Independence Depth of Experience . The Corporate Governance Guidelines require at least two thirds of Dover’s Board to be independent. The Board believes ensuring appropriate independence exists among the directors enables the Board to effectively carry out its oversight responsibilities. Each director nominee is presently considered to be independent other than the CEO. As further described on page 26 of this proxy statement, the Board believes that combining the offices of Board Chair and CEO is the appropriate leadership structure for Dover at this time.
Director Nomination Process
Whenever the Governance and Nominating Committee concludes that a new nominee to our Board is required or advisable, it will consider recommendations from directors, management, shareholders and, if it deems appropriate, consultants retained for that purpose. In such circumstances, it will evaluate individuals recommended by shareholders in the same manner as nominees recommended from other sources.
Shareholder Nominations for Director
Shareholders who wish to recommend an individual for nomination should send that person’s name and supporting information to the Governance and Nominating Committee, in care of the Corporate Secretary at our principal executive offices, 3005 Highland Parkway, Downers Grove, Illinois, 60515, or through our communications coordinator. Shareholders who wish to directly nominate an individual for election as a director, without going through the Governance and Nominating Committee, must comply with the procedures in our by-laws. Please see “ General Information About the Annual Meeting” for nomination deadlines.
Proxy Access Shareholder Right
Following extensive engagement with our shareholders, our Board determined to adopt proxy access in February 2016, permitting a shareholder or group of up to 20 shareholders holding 3% of our outstanding shares of common stock for at least three years to nominate a number of directors constituting the greater of two directors or 20% of the number of directors on our Board, as set forth in detail in our by-laws.
DOVER CORPORATION – 2024 Proxy Statement 10
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
2024 Director Nominees
There are ten nominees for election to our Board at this Annual Meeting, each to serve until the next annual meeting of shareholders or his or her earlier removal, resignation or retirement. All nominees currently serve on our Board and are being proposed for re-election by our Board.
Current director Stephen M. Todd is not standing for re-election and will retire from the Board effective as of the Annual Meeting. Marc A. Howze and Danita K. Ostling are nominees who are being submitted for election by shareholders for the first time, following their appointments to the Board in November and August 2023, respectively.
If any nominee for election becomes unavailable or unwilling to serve as a director before the Annual Meeting, an event which we do not anticipate, the persons named as proxies will vote for a substitute nominee or nominees as may be designated by our Board, or the Board may reduce the number of directors. Directors will be elected by a majority of the votes cast in connection with their election.
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Deborah L. DeHaas
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Independent Director Nominee Director since: 2021 Age: 64
Committees: Audit, Governance and Nominating
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Skills and Qualifications : |
| • |
Significant leadership, financial and corporate governance expertise garnered from her nearly 40 years of experience at major audit, assurance and consulting firms |
| • |
Certified public accountant (“CPA”) and has extensive experience with financial, accounting, internal controls, and enterprise risk management |
| • |
Has deep expertise on governance, both as a topic and discipline, developed during her career at Deloitte |
| • |
As a former member of the Value Reporting Foundation Board (formerly the SASB Foundation Board), contributes valuable and well-informed insights on a variety of ESG matters |
| • |
Brings relevant public company board service, serving on the board of CF Industries Holdings, Inc. |
| • |
Brings experience and perspective on matters regarding human capital and culture, including diversity and inclusion |
| • |
Holds a bachelor’s degree in management science and accounting from Duke University |
| • |
Included in the National Association of Corporate Directors (“NACD”) Directorship 100 from 2015-2020, recognizing influential leaders in corporate governance and is also an NACD Board Leadership Fellow |
|
Business Experience: |
| • |
CEO of the Corporate Leadership Center, a non-profit leadership development forum |
| • |
Former Vice Chairman and National Managing Partner of the Center for Board Effectiveness at Deloitte |
| • |
Former member of the U.S. Executive Committee |
| • |
Former Vice Chairman and Chief Inclusion Officer |
| • |
Former member of the U.S. Board of Directors |
| • |
Former Vice Chairman and Central Region Managing Partner |
| • |
Former Vice Chairman and Midwest Regional Managing Partner |
| • |
Former Regional Managing Partner, Strategic Clients |
| • |
Former positions of increasing responsibility at Arthur Andersen, an audit, financial advisory, tax and consulting firm, most recently as Managing Partner Business Advisory Assurance, Central Region |
|
Other Board Experience: |
| • |
CF Industries Holdings, Inc. |
DOVER CORPORATION – 2024 Proxy Statement 11
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
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H. John Gilbertson, Jr.
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Independent Director Nominee Director since: 2018 Age: 67
Committees: Finance, Governance and Nominating
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Skills and Qualifications: |
| • |
Extensive experience in corporate finance, capital markets, and mergers and acquisitions |
| • |
Considerable expertise and decades of experience in corporate governance and board and committee processes |
| • |
Served as a strategic and financial advisor to his clients, forming deep relationships with companies in a range of industries |
| • |
Has nearly four decades of experience in the professional and financial services industry |
| • |
Deep expertise in financial management, coupled with his analytical and collaborative mindset, allows him to make invaluable contributions to our Board |
| • |
Strong background in senior leadership development, succession planning, and organizational culture development |
| • |
Brings to the Board considerable expertise in financial risk oversight and capital allocation |
| • |
Bachelor’s degree in political economy from Dartmouth College and an MBA from Harvard University |
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Business Experience: |
| • |
Retired Managing Director at Goldman Sachs |
| • |
Served as Advisory Director and Partner-in-Charge, Midwest Region Investment Banking Services |
| • |
Served as Managing Director at Travelers Group Inc. |
| • |
Former Associate, Mergers and Acquisitions at Morgan Stanley |
| • |
Former Consultant, Corporate Strategy at Bain Company |
| • |
Former Assistant Treasurer, Corporate Banking at Chase Manhattan Bank |
| • |
Former News Reporter at The Providence Journal Company |
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Other Board Experience: |
| • |
Director and Chair of Audit Committee of Meijer, Inc. (“Meijer”) |
| • |
Former Director of AAR Corp. |
DOVER CORPORATION – 2024 Proxy Statement 12
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
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Kristiane C. Graham
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Independent Director Nominee Director since: 1999 Age: 66
Committees: Compensation, Governance and Nominating
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Skills and Qualifications : |
| • |
Experience as a private investor with substantial holdings of Dover stock and her shared interests in Dover, including interests through charitable organizations of which she is a director, makes her a good surrogate for our individual and retail investors |
| • |
Experience with a commercial bank, primarily as a loan officer; founded and operated an advisory company and a publication regarding international thoroughbred racing and now co-manages her family’s investments |
| • |
Actively works with and has served on the boards of various organizations to support the objectives of local communities, affordable housing, education, and health |
| • |
Serves on the Board of Directors of Habitat for Humanity International |
| • |
Serves on the Board of Trustees of the Virginia Museum of Fine Arts Foundation |
| • |
Serves as an Emeritus Trustee of the College Foundation of the University of Virginia and has previously served on the Advisory Board of the University of Virginia School of Nursing |
| • |
Brings valuable insights on the development of our policies and strategies relating to talent, leadership, and culture, with a focus on diversity and inclusion |
| • |
Devoted substantial time to monitoring the development of Dover operating company leaders, enabling her to provide the Board valuable insights regarding management succession |
| • |
As a member of one of the founding families of Dover, Ms. Graham also brings to the Board a sense of Dover’s historical values, culture and strategic vision which the Board believes is beneficial as it considers various strategic planning alternatives for shaping Dover’s future |
|
Business Experience: |
| • |
Private Investor |
DOVER CORPORATION – 2024 Proxy Statement 13
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
|
|
Marc A. Howze
|
|||
|
|
||||
|
Independent Director Nominee Director since: 2023 Age: 60
Committees: Audit
|
||||
|
Skills and Qualifications : |
| • |
Brings significant leadership and business experience garnered during more than two decades at Deere Company (“Deere”), including in his role as Senior Advisor, Office of the Chairman, upon his retirement in February 2024 |
| • |
During his career, Mr. Howze spearheaded strategic initiatives focused on improving operations, delivering customer value, developing future leaders, making Deere a highly regarded employer, and promoting Deere’s brand |
| • |
Under his leadership, Deere was recognized as one of Interbrand’s top global brands, Glassdoor’s Best Places to Work, Fast Company’s Most Innovative Workplaces, and the American Innovation Index’s Most Innovative Firms. |
| • |
Prior to joining Deere, Mr. Howze served as an officer in the U.S. Army, attaining the rank of major. During 12 years of active-duty service, Howze excelled in various capacities, including field artillery and the Judge Advocate General’s Corps. |
| • |
Holds a bachelor’s degree from the University of Michigan-Dearborn, a JD from the University of Michigan Law School, and an MBA from the Fuqua School of Business at Duke University |
|
Business Experience : |
| • |
Former Senior Advisor, Office of the Chairman at Deere |
| • |
Former Group President, Lifecycle Solutions and Chief Administrative Officer at Deere |
| • |
Former Senior Vice President and Chief Administrative Officer at Deere |
| • |
Former Vice President of Global Human Resources and Employee Communications at Deere |
| • |
Former Manager of Business Development, Ag Turf division at Deere |
| • |
Former Associate General Counsel and Corporate Secretary at Deere |
|
Other Board Experience : |
| • |
Nationwide Mutual Insurance Company |
| • |
Lincoln Electric Holdings, Inc. |
DOVER CORPORATION – 2024 Proxy Statement 14
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
|
|
Michael F. Johnston
|
|||
|
|
||||
|
Lead Independent Director; Independent Director Nominee Director since: 2013 Age: 76
Committees: Compensation, Governance and Nominating (Chair)
|
||||
|
Skills and Qualifications : |
| • |
Brings industry insight, financial expertise and leadership experience garnered from his more than two decades on the boards of global companies |
| • |
Served as CEO of an $18 billion global manufacturer |
| • |
Mr. Johnston also brings valuable corporate governance perspectives from his prior board service, including as a lead Director and Chair of other major public companies |
| • |
Brings deep operations experience, which has helped him gain knowledge and a deep understanding in manufacturing, design, innovation, engineering, accounting and finance and capital structure |
| • |
Brings nearly two decades of experience in building businesses in emerging economies |
| • |
Bachelor’s degree in industrial management from the University of Massachusetts and an MBA from Michigan State University |
|
Business Experience : |
| • |
Former CEO and President of Visteon Corporation (“Visteon”) |
| • |
Former Chief Operating Officer of Visteon |
| • |
Former President of North America/Asia Pacific, Automotive Systems Group, of Johnson Controls, Inc. (“Johnson Controls”) |
| • |
Former President of Americas Automotive Group of Johnson Controls |
|
Other Board Experience : |
| • |
Former Chairman and Director of Visteon |
| • |
Former Director of Armstrong World Industries, Armstrong Flooring, Inc., Flowserve Corporation, and Whirlpool Corporation |
DOVER CORPORATION – 2024 Proxy Statement 15
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
|
Michael Manley
|
|||
|
|
||||
|
Independent Director Nominee Director since: 2023 Age: 60
Committees: Audit, Finance
|
||||
|
Skills and Qualifications : |
| • |
Currently the Chief Executive Officer of AutoNation, Inc., the largest automotive retailer in the United States |
| • |
Successfully managed a wide array of business models over his career |
| • |
Extensive knowledge of manufacturing operations and supply chains, multi-national business management, capital markets, and mergers and acquisitions |
| • |
MBA from Ashridge Management College and a Bachelor of Science in engineering from Southbank University |
|
Business Experience : |
| • |
Chief Executive Officer AutoNation, Inc. |
| • |
Former head of Americas and member of the Group Executive Council for Stellantis N.V. |
| • |
Former Chief Executive Officer of Fiat Chrysler Automobiles N.V. (“FCA”), a predecessor to Stellantis N.V. |
| • |
Former Executive Vice President – International Sales Marketing, Business Development and Global Product Planning Operations |
| • |
Former Chief Executive Officer of Jeep |
| • |
Former Chief Executive Officer of Ram |
| • |
Former Chief Operating Officer for the Asia Pacific region |
| • |
Former FCA Global Executive Council member |
|
Other Board Experience : |
| • |
AutoNation, Inc. |
DOVER CORPORATION – 2024 Proxy Statement 16
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
|
|
Danita K. Ostling
|
|||
|
|
||||
|
Independent Director Nominee Director since: 2023 Age: 63
Committees: Audit
|
||||
|
Skills and Qualifications : |
| • |
Brings extensive expertise in accounting and auditing, with significant experience consulting on complex accounting issues for large global companies and ESG reporting |
| • |
Certified public accountant (“CPA”), bringing subject matter knowledge with respect to accounting and audit standards, risk management and compliance, and evaluation of cybersecurity breaches and potential accounting and financial controls impacts |
| • |
Holds a bachelor’s degree in accounting from the University of Arkansas at Little Rock |
|
Business Experience : |
| • |
Former partner and senior leader at Ernst Young LLP (“EY”), serving in various leadership roles from 1999 until her retirement in 2021; and prior thereto, various positions with EY |
| • |
Former Professional Practice Director, U.S. East Region |
| • |
Former Americas IFRS Technical Leader |
| • |
Former co-Director of Assurance Professional Practice – Accounting |
| • |
Former Deputy Director of Global Assurance Professional Practice — Accounting |
| • |
Former Vice President, Corporate Accounting Policy and Advisory Group at Citigroup, Inc. |
|
Other Board Experience : |
| • |
Director and Chair of Audit Committee of Circle Internet Financial Limited |
| • |
Director and Audit Committee member of nVent Electric plc |
| • |
Director and Chair of Audit Committee of Varsity Brands, Inc. |
DOVER CORPORATION – 2024 Proxy Statement 17
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
|
|
Eric A. Spiegel
|
|||
|
|
||||
|
Independent Director Nominee Director since: 2017 Age: 66
Committees: Audit, Finance (Chair)
|
|
Skills and Qualifications: |
| • |
Experienced business leader with diversified, global experience who brings deep and valuable expertise in strategy development, corporate restructuring, portfolio management and MA to our Board |
| • |
40+ years of experience working with large, global companies in the energy and industrial markets, mostly recently as President CEO of Siemens USA |
| • |
At Siemens, he led strategic reviews across a portfolio of ~45 businesses in the company’s largest market with over $22 billion in revenue, 50,000 employees and over 60 manufacturing facilities |
| • |
Participated in the acquisition, divestiture, joint venture and carve-out of over 30 business units and segments |
| • |
Executed Siemens’ “Vision 2020” initiative to optimize growth and margins in the U.S., across all sectors |
| • |
Prior to Siemens, Mr. Spiegel was a global consultant at Booz Allen Hamilton focused on complex organizations in the energy, power, chemical, water, industrial and automotive fields |
| • |
At Booz, he worked with major energy clients globally on projects around corporate strategy, MA, major capital projects, cost restructuring, margin enhancement and supply chain re-design and was also closely involved with the government sector |
| • |
An expert on the global energy industry, Mr. Spiegel co-authored the book Energy Shift: Game-changing Options for Fueling the Future |
| • |
Holds a bachelor’s degree in economics from Harvard University and an MBA from the Tuck School of Business at Dartmouth College |
|
Business Experience: |
| • |
Special Advisor at Brighton Park Capital, a private equity firm, where he supports the firm’s sector investment teams and portfolio companies by providing strategic counsel on industry trends and growth strategies |
| • |
Former President and CEO of Siemens USA |
| • |
Former Managing Partner, Global Energy, Chemicals, and Power, and Managing Partner, Washington, D.C. office, and other roles at Booz Company, Inc. (now known as Strategy) and Booz Allen Hamilton, Inc., global consulting firms |
| • |
Former Associate, Energy and Industrials Practice, at Temple, Barker Sloane, Inc. (now known as Oliver Wyman) |
| • |
Former Marketing and Strategy Manager at Brown Boveri Cie (now known as ABB), a Swiss group of electrical engineering companies |
| • |
In connection with his position at Brighton Park Capital, Mr. Spiegel serves as Chair of Relatient, Inc. |
|
Other Board Experience: |
| • |
Director and Audit Committee Chair of Liberty Mutual Holding Company, Inc. |
| • |
Director and Audit Committee Chair of Project Energy Reimagined Acquisition Corp. |
| • |
Director of TeamBuilder LLC |
DOVER CORPORATION – 2024 Proxy Statement 18
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
|
|
Richard J. Tobin
|
|||
|
|
||||
|
Board Chair; Chief Executive Officer Director since: 2016 Age: 60
Committees: None
|
||||
|
Skills and Qualifications: |
| • |
Mr. Tobin is Dover’s current Board Chair and CEO. |
| • |
Has a broad range of industry and functional experiences acquired through regional and global leadership positions |
| • |
Former CEO of CNH Industrial, a complex international industrial company, where he led efforts to increase efficiencies, innovate through new technologies, expand geographically, and maximize the company’s portfolio of businesses |
| • |
Gained extensive experience in international finance, operations, management, and information technology in his prior roles |
| • |
Developed deep expertise with global capital markets through his international finance leadership roles |
| • |
Prior to beginning his business career, Mr. Tobin was an officer in the United States Army |
| • |
Member of the Board of Trustees of the John G. Shedd Aquarium in Chicago |
| • |
Formerly served on the U.S. Chamber of Commerce Board of Directors, and is a former member of the Business Roundtable |
| • |
Holds a bachelor of arts from Norwich University and an MBA from Drexel University |
|
Business Experience: |
| • |
President and CEO of Dover |
| • |
Former CEO of CNH Industrial NV (“CNH Industrial”) |
| • |
Former Group Chief Operating Officer of Fiat Industrial S.p.A |
| • |
Former President and CEO of CNH Global NV |
| • |
Former CFO of CNH Global NV |
| • |
Former Chief Finance Officer Head of Information Technology of SGS Group |
| • |
Former Chief Operating Officer for North America of SGS Group |
|
Other Board Experience: |
| • |
Director of KeyCorp. |
| • |
Former director of CNH Industrial |
DOVER CORPORATION – 2024 Proxy Statement 19
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
|
|
Keith E. Wandell
|
|||
|
|
||||
|
Independent Director Nominee Director since: 2015 Age: 74
Committees: Compensation (Chair) , Finance
|
||||
|
Skills and Qualifications: |
| • |
Mr. Wandell brings to the Board the valuable perspective of a strategic, experienced leader with a strong record focused on growth, profitability, international expansion and innovation. |
| • |
Has over 30 years of experience in diversified manufacturing businesses, most recently as the former Chairman and CEO of Harley-Davidson, Inc. (“Harley-Davidson”) where he led transformation efforts across the company’s product development, manufacturing and retail functions, focused on international expansion and implemented a restructuring plan |
| • |
Prior to joining Harley-Davidson, Mr. Wandell served as President and Chief Operating Officer of Johnson Controls, Inc. (“Johnson Controls”) and helped manage the company’s entry into the Chinese car-battery market as well as its subsequent joint venture with China’s largest battery manufacturer |
| • |
Gained valuable insights into the effective development of executive leadership capabilities and strong corporate cultures through his experience as a senior leader at various companies |
| • |
Served on the boards of four other public companies, including the two on which he currently serves |
| • |
Holds a bachelor’s degree in business administration from Ohio University and an MBA from the University of Dayton |
|
Business Experience: |
| • |
Former President and CEO of Harley-Davidson |
| • |
Former President and Chief Operating Officer of Johnson Controls |
| • |
Former Executive Vice President of Johnson Controls |
| • |
Former Corporate Vice President of Johnson Controls |
| • |
Former President of the Automotive Experience business of Johnson Controls |
| • |
Former President of the Power Solutions business of Johnson Controls |
|
Other Board Experience: |
| • |
Director of Dana Incorporated |
| • |
Former Director of Constellation Brands, Inc. and Clarcor, Inc. |
| • |
Former Chairman of Harley-Davidson |
THE BOARD RECOMMENDS A VOTE “FOR” THE ELECTION OF EACH
OF THE NOMINEES NAMED ABOVE.
DOVER CORPORATION – 2024 Proxy Statement 20
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
Board Oversight and Governance Practices
Our Board is responsible for, and committed to, overseeing our long-term strategic development as well as managing the principal and most significant risks that we face. In carrying out this duty, our Board advises senior management to help drive long-term value creation for our shareholders. The Board delegates specific areas of responsibility to relevant Board committees, as detailed below under the heading “Overview of Committee Responsibilities”, who report on their deliberations to the Board. The following summarizes our Board’s key areas of oversight responsibility.
Board Oversight
| KEY AREAS OF BOARD OVERSIGHT | ||
|
Long-Term Business Strategy |
• One of the primary responsibilities of our Board is the oversight of management’s long-term strategy and planning . Accordingly, our Board maintains a deep level of engagement with management in setting and overseeing Dover’s long-term business strategy.
|
|
| Capital Allocation |
• Our Board is focused on the efficient allocation of capital to drive growth and provide returns to our shareholders. Our capital allocation priorities are organic investments, strategic acquisitions, and the return of capital to our shareholders.
• We consistently return cash to shareholders by paying dividends , which have increased annually over each of the last 68 years .
• We also undertake opportunistic share repurchases as part of our capital allocation strategy.
• We made approximately $193 million in capital expenditures in 2023, representing 2.3% of revenue, and $221 million in capital expenditures in 2022, representing 2.6% of revenue, in line with our priority of organic reinvestment to grow and strengthen our existing businesses.
• We employ a prudent financial policy to support our capital allocation strategy, which includes maintaining an investment grade credit rating .
|
|
|
Portfolio Management |
• Businesses in our portfolio are continually evaluated for strategic fit.
• We seek to deploy capital in acquisitions in attractive growth areas across our five segments . We focus primarily on bolt-on acquisitions, applying strict selection criteria of market attractiveness (including growth, market landscape, and performance-based competition), business fit (including sustained leading position, revenue visibility, and favorable customer value-add versus switching cost or risk) and financial return profile (accretive growth and margins and double-digit return on invested capital).
• We have sold or divested some of our businesses based on changes in specific market outlook, structural changes in financial performance, value-creation potential, or for other strategic considerations, which included an effort to reduce our exposure to cyclical markets or focus on our higher margin and higher growth spaces.
|
|
DOVER CORPORATION – 2024 Proxy Statement 21
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
| KEY AREAS OF BOARD OVERSIGHT | ||
|
Risk
|
• Our Board has established a comprehensive enterprise risk management process to identify and manage risks , and periodically reviews the processes established by management to identify and manage risks and communicates with management about these processes.
• We have established a risk assessment team consisting of senior executives, which annually, with the assistance of a consultant, oversees a risk assessment made at the corporate center, segment and operating company levels and, with that information in mind, performs an assessment of the overall risks our company may face and reports to the Board on that assessment. Each quarter, this team reassesses the risks, the severity of these risks, and the status of efforts to mitigate them.
|
|
|
ESG |
• The full Board has oversight of ESG matters and is regularly briefed on strategic planning, risks, and opportunities related to ESG by senior management, including our CEO.
• Our Compensation Committee has integrated ESG oversight responsibility into our CEO’s individual strategic objectives within the AIP.
|
|
|
Culture Human
Capital Management |
• Our entrepreneurial culture depends upon an inclusive approach that values employees’ diversity and contributions .
• We foster an operating culture with high ethical standards that values accountability, rigor, trust, inclusion, respect, and open communication and is designed to encourage individual growth and operational effectiveness. We continue to make significant investments in talent development, including in the areas of digital applications and operational management, and recognize that the growth and development of our employees is essential for our continued success .
• As part of our commitment to strong corporate governance practices, we maintain an active and robust ethics program . Our Code of Conduct applies to all employees and directors of Dover and its subsidiaries. We enforce our Code of Conduct fairly and consistently, regardless of one’s position in Dover, and will not tolerate retaliation against those who report suspected misconduct in good faith.
|
|
|
Succession
Planning |
• Another of the Board’s primary responsibilities is overseeing a sound Board and management succession process . The Board has developed a comprehensive plan to address management succession — both over the long term and for emergency purposes. The framework for the long-term plan includes thoughtful, deliberate monitoring of management beyond our top executives to ensure Dover continues to build a deep internal bench of talent.
• Our Board is also focused on its own succession plan , which drives not only our director selection efforts, but also how we approach Board and committee leadership structure and membership, with a focus on critical board skills, diversity, and independence . The recent appointments of Danita Ostling and Marc Howze demonstrate our commitment to active Board refreshment.
|
|
| Cybersecurity |
• The full Board is briefed on enterprise-wide cybersecurity risk management and the overall cybersecurity risk environment, and oversees major tasks related to cybersecurity risk management, periodically reviews our response capabilities, and meets with the Senior Vice President Chief Digital Officer and our Chief Information Security Officer on at least an annual basis.
• We regularly assess our threat landscape and monitor our systems and other technical security controls, maintain information security policies and procedures, ensure maintenance of backup and protective systems, and have a team of security personnel managing our efforts and initiatives.
|
|
DOVER CORPORATION – 2024 Proxy Statement 22
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
Board Committees
Our Board has four standing committees — the Audit Committee, the Compensation Committee, the Governance and Nominating Committee, and the Finance Committee. The table below sets forth a summary of our committee structure and membership information.
|
DIRECTOR |
Audit
Committee |
Compensation
Committee |
Governance
and
Nominating
|
Finance
Committee |
||||
|
DEBORAH L. DEHAAS |
✓ |
✓ |
||||||
|
H. JOHN GILBERTSON, JR. |
✓ |
✓ | ||||||
|
KRISTIANE C. GRAHAM |
✓ |
✓ |
||||||
|
MARC A. HOWZE |
✓ |
|||||||
|
MICHAEL F. JOHNSTON |
✓ | ✓ (Chair) | ||||||
|
MICHAEL MANLEY |
✓ |
✓ | ||||||
|
DANITA K. OSTLING |
✓ |
|||||||
|
ERIC A. SPIEGEL |
✓ |
✓ (Chair) |
||||||
|
RICHARD J. TOBIN |
||||||||
|
STEPHEN M. TODD* |
✓ (Chair) |
|||||||
|
KEITH E. WANDELL |
✓ (Chair) |
✓ |
||||||
|
MEETINGS HELD IN 2023 |
8 |
5 |
4 |
5 |
||||
| * |
Mr. Todd is not standing for re-election and will retire from the Board effective as of the Annual Meeting, at which time the size of our Board will be reduced to ten members. |
DOVER CORPORATION – 2024 Proxy Statement 23
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
Overview of Committee Responsibilities
|
Audit Committee |
||
|
Stephen M. Todd (Chair)
Deborah L. DeHaas Marc. A Howze Michael Manley Danita K. Ostling Eric A. Spiegel |
Key Responsibilities
• Selecting and engaging our independent registered public accounting firm (“independent auditors”)
• Overseeing the work of our independent auditors and our internal audit function
• Approving in advance all services to be provided by, and all fees to be paid to, our independent auditors, who report directly to the committee
• Reviewing with management and the independent auditors the audit plan and results of the auditing engagement
• Reviewing with management and our independent auditors the quality and adequacy of our internal control over financial reporting
The Audit Committee holds regular quarterly meetings at which it meets separately with each of our independent registered public accounting firm, PwC, our internal audit function, financial management and our general counsel to assess certain matters including the status of the independent audit process, management’s assessment of the effectiveness of internal control over financial reporting and the operation and effectiveness of our compliance program. In addition, the Audit Committee, as a whole, reviews and meets to discuss the contents of each Form 10-Q and Form 10-K (including the financial statements) prior to its filing with the SEC.
Our Board has determined that all members of the Audit Committee except for Mr. Howze qualify as “audit committee financial experts” as defined in the SEC rules.
The Audit Committee’s responsibilities and authority are described in greater detail in its written charter.
|
|
|
Compensation Committee |
||
|
Keith E. Wandell (Chair)
Kristiane C. Graham Michael F. Johnston |
Key Responsibilities
The Compensation Committee, together with our independent directors, approves compensation for the CEO of Dover. The functions of the Compensation Committee also include:
• Approving compensation for executive officers who report directly to the CEO (together with the CEO, “senior executive officers”)
• Granting awards and approving payouts under our 2012 Equity and Cash Incentive Plan (the “2012 LTIP”), our 2021 Omnibus Incentive Plan (the “2021 LTIP”) and our AIP
• Approving changes to our executive compensation plans
• Reviewing and recommending compensation for the Board
• Overseeing succession planning and management development programs
The Compensation Committee’s responsibilities and authority are described in greater detail in its written charter.
|
|
DOVER CORPORATION – 2024 Proxy Statement 24
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
|
Governance and Nominating Committee |
||
|
Michael F. Johnston (Chair)
Deborah L. DeHaas H. John Gilbertson, Jr. Kristiane C. Graham |
Key Responsibilities
• Developing and recommending corporate governance principles to our Board
• Annually reviewing the requisite skills and characteristics of board members as well as the size, composition, functioning and needs of our Board as a whole
• Considering and recommending to the Board nominees for election to, or for filling any vacancy on, our Board in accordance with our by-laws, our governance guidelines, and the committee’s charter
• Identifying and recommending to our Board any changes it believes desirable in the size and composition of our Board
• Recommending to our Board any changes it believes desirable in structure and membership of our Board’s committees
• Providing oversight of Dover’s practices on political contributions and lobbying expenses and reviewing annually Dover’s political contributions and lobbying expenses
The Governance and Nominating Committee’s responsibilities and authority are described in greater detail in its written charter.
|
|
|
Finance Committee |
||
|
Eric A. Spiegel (Chair)
H. John Gilbertson, Jr. Michael Manley Keith E. Wandell |
Key Responsibilities
• Reviewing and recommending for approval by the Board proposed changes to dividend policies, stock splits, and repurchase programs
• Reviewing our capital structure, liquidity, and financing plans
• Reviewing and approving the registration and issuance of debt or equity securities
• Subject to thresholds determined from time to time by the Board, reviewing and approving, or reviewing and recommending for Board approval, capital expenditures
• Subject to thresholds determined from time to time by the Board, reviewing and approving, or reviewing and recommending for Board approval, MA transactions
• Oversight of treasury, insurance, and tax planning matters
The Finance Committee’s responsibilities and authority are described in greater detail in its written charter.
|
|
DOVER CORPORATION – 2024 Proxy Statement 25
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
Corporate Governance
Our Board is committed to sound governance practices and regularly reviews and refines our profile to reflect evolving best practices and matters raised by our shareholders. The following summarizes key aspects of our governance framework.
|
GOVERNANCE HIGHLIGHTS |
||
|
Independent Board Leadership |
• Our Board has leadership that is independent from management, by way of a Lead Independent Director, and all directors are independent, other than our Board Chair. |
|
| Commitment to Diversity |
• Our Board has adopted a policy, reflected in our Corporate Governance Guidelines, requiring that the initial list of potential director and external CEO candidates presented by third-party search firms include qualified candidates who reflect diverse backgrounds, including diversity of gender and race or ethnicity . |
|
|
Special
Shareholder Meetings |
• Our by-laws include a right of shareholders holding 15% or more of the voting power of our outstanding stock to call a special meeting of shareholders . |
|
|
Elimination of
|
• All of the supermajority voting provisions in our charter were eliminated in 2019. |
|
| Board Committee Refreshment |
• Our Board periodically reviews committee composition and chair positions , seeking the appropriate blend of continuity and fresh perspectives on committees. |
|
|
Annual Majority
Vote Director Elections Mandatory Resignation Policy |
• All of our directors are elected annually by our shareholders.
• Our directors must receive a majority of the votes cast in uncontested elections to be elected.
• We have a director resignation policy that requires a director to tender an irrevocable resignation letter to the Board prior to being nominated, contingent on the director not receiving a majority of the votes cast in an uncontested election and the Board’s acceptance of the resignation. The Governance and Nominating Committee will recommend to the full Board whether to accept the resignation or whether to take other action. |
|
| Proxy Access |
• Our by-laws permit a shareholder or a group of up to 20 shareholders owning 3% or more of our outstanding common stock continuously for at least three years to nominate and include in our proxy materials director candidates constituting up to the greater of two individuals or 20% of the Board, provided that the shareholder(s) and the nominee(s) satisfy the requirements specified in our by-laws.
|
|
Board Leadership Structure
Our Board believes that it should retain the flexibility to determine whether the Chair of the Board and Chief Executive Officer roles should be separated or combined based on the circumstances at any given point in time. The Board also believes that it is important to have strong, independent Board leadership to help ensure effective Board oversight and sound Board decision-making involving corporate strategy, performance, succession, and other critical matters. Accordingly, our Corporate Governance Guidelines require that, in the event the Chair of the Board is not an independent director, the independent directors will appoint an independent director as Lead Independent Director.
Mr. Tobin, who serves as our President and Chief Executive Officer, was unanimously appointed Board Chair effective February 10, 2024. The Board’s decision to combine the roles of Chair and CEO under Mr. Tobin reflects the Board’s strong belief that he has demonstrated the leadership and strategic vision necessary to lead the Board and the Company. The Board believes that this leadership structure promotes efficient Board functioning, fosters a constructive and cooperative relationship between the Board and senior management and, together with an experienced Lead Independent Director, is the appropriate leadership structure for Dover at this time.
DOVER CORPORATION – 2024 Proxy Statement 26
Table of Contents
PROPOSAL 1 — ELECTION OF DIRECTORS
Lead Independent Director
In connection with the Board’s decision to appoint Mr. Tobin as Chair, the Board appointed Mr. Johnston as the Lead Independent Director, effective February 10, 2024. In making this determination, the independent directors took into consideration Mr. Johnston’s tenure, knowledge of Dover’s business and strategy, and demonstrated independent voice in the boardroom. The Board concluded that Mr. Johnston, who led the Board as Chair from 2016 to 2024, is well positioned to continue in a leadership role to facilitate carrying out the Board’s oversight responsibilities.
The Board also amended Dover’s Corporate Governance Guidelines to define the authority and responsibilities of the Lead Independent Director. Among other duties, the responsibilities include:
| • |
Presiding at all meetings of the Board at which the Board Chair is not present, including executive sessions of the independent directors; |
| • |
Coordinating the activities of the independent directors, including having the authority to call meetings of the independent directors; |
| • |
Establishing the agenda for executive sessions of the independent directors; |
| • |
In consultation with the Board Chair and senior management, establishing the agenda for each Board meeting and ensuring that information provided to the Board is timely and appropriate; |
| • |
Facilitating communications between Board members, including serving as principal liaison between the independent directors and the Board Chair; |
| • |
Consulting with the Board Chair on such other matters as are pertinent to the Board and the Company; |
| • |
If appropriate, and in coordination with executive management, being available for consultation and direct communication with significant stakeholders; and |
| • |
Performing such other duties as may be specified by the Board. |
Board, Committee and Individual Director Evaluations
Our Board and its committees conduct robust annual self-evaluations of their performance. In addition, our Board evaluates one-third of our directors on a rotating individual basis each year with the purpose of assisting each director to be a more effective member of the Board. New directors undergo the evaluation process in each of their first two years on the Board. Our directors believe the rotational nature of our evaluation process enables a more in-depth, comprehensive evaluation for each of our directors.
Directors’ Meetings and Attendance
During 2023, the Board met four times. No director attended less than 75% of the board meetings and standing committee meetings on which he or she served in 2023. Board attendance was 100% in 2023. Our independent directors meet at regularly scheduled executive sessions at least quarterly without management representatives or non-independent directors present. The Chair of the Board or the Lead Independent Director, as applicable, presides at these sessions. We expect our directors to attend the Annual Meeting. All directors then in office attended the 2023 Annual Meeting.
Our directors also regularly engage with management and outside subject matter experts outside of formal meetings. Examples include developing agendas and reviewing the content of materials in advance of meetings, calls, or in-person meetings with members of management to prepare for meetings, receiving periodic updates from management on significant operational or strategic developments between meetings, and, from time to time, engaging with shareholders.
Management Meetings and Site Visits
We encourage our directors to meet with senior managers throughout the enterprise and attend management’s strategic planning sessions. When considering businesses to visit, priority goes to those businesses identified as strategically important as well as those that were recently acquired. From time to time, the Board makes on-site visits to our businesses to tour the manufacturing facilities and meet face-to-face with company management and employees. These visits serve as an important tool in the Board’s succession planning process for our senior leadership team and enable a deeper understanding of our businesses and our culture.
DOVER CORPORATION – 2024 Proxy Statement 27
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PROPOSAL 1 — ELECTION OF DIRECTORS
Director Orientation and Education
All new directors participate in our director orientation program. New directors meet with senior corporate leaders to review and discuss our businesses, operations, strategy, end markets, governance, internal controls, and culture. We believe that our on-boarding approach, coupled with participation in regular Board and committee meetings, as well as additional exposure to our business through participation in management meetings and site visits, whether virtually or in-person, provides new directors a strong foundation in our businesses and accelerates their effectiveness to fully engage in Board deliberations.
Our Board also encourages directors to participate annually in continuing director education programs outside of the Boardroom, and we reimburse directors for their expenses associated with this participation.
Director Independence
Our Board has determined that each of the current members of the Board, except for Richard J. Tobin, who is our CEO, has no material relationship with Dover and satisfies all the criteria for being “independent” members of our Board. This includes the criteria established by the New York Stock Exchange (“NYSE”) listing standards, as well as our standards for classification as an independent director which are available on our website at www.dovercorporation.com. Our Board makes an annual determination of the independence of each nominee for director prior to his or her nomination for re-election. No director may be deemed independent unless the Board determines that he or she has no material relationship with Dover, directly or as an officer, shareholder or partner of an organization that has a material relationship with Dover.
Majority Standard for Election of Directors and Mandatory Resignation Policy
Under our by-laws and corporate governance guidelines, the voting standard in director elections is a majority of the votes cast. Under this majority of the votes cast standard, a director must receive more votes in favor of his or her election than votes against his or her election. Abstentions and broker non-votes do not count as votes cast with respect to a director’s election. In contested director elections (where there are more nominees than available seats on the board), the plurality standard will apply. Under the plurality standard, the nominees who receive the most “for” votes are elected to the Board until all seats are filled.
For an incumbent director to be nominated for re-election, he or she must submit an irrevocable resignation letter. The resignation will be contingent on the nominee not receiving a majority of the votes cast in an uncontested election and on the Board’s acceptance of the resignation. If an incumbent director fails to receive a majority of the votes cast in an uncontested election, the Governance and Nominating Committee will make a recommendation to our Board concerning whether to accept or reject the resignation or whether other action should be taken. Our Board will act on the resignation within 90 days following certification of the election results, taking into account the committee’s recommendation. The Board will publicly announce its decision and, if the resignation is rejected, the rationale for its decision.
Governance Guidelines and Code of Ethics
Our Board long ago adopted written corporate governance guidelines that set forth the responsibilities of our Board and the qualifications and independence of its members and the members of its standing committees. The Board reviews these guidelines at least annually, in light of evolving best practices, shareholder feedback and the evolution of our business. In 2020, the Board amended the guidelines to require that initial lists of potential director and external CEO candidates presented by third-party search firms include qualified candidates who reflect diverse backgrounds, including diversity of gender and race or ethnicity. In 2024, the Board amended the guidelines to define the authority and responsibilities of the Lead Independent Director. In addition, our Board has a long-standing Code of Conduct setting forth standards applicable to all of our companies and their employees, a code of ethics for our CEO and senior financial officers, and charters for each of its standing committees. All of these documents (referred to collectively as “governance materials”) are available on our website at www.dovercorporation.com.
Procedures for Approval of Related Person Transactions
We generally do not engage in transactions in which our senior executive officers or directors, any of their immediate family members or any of our 5% shareholders have a material interest. Should a proposed transaction or series of similar transactions involve any such persons and an amount that exceeds $120,000, it would be subject to review and approval by the Governance and Nominating Committee in accordance with a written policy and the procedures adopted by our Board, which are available with the governance materials on our website.
DOVER CORPORATION – 2024 Proxy Statement 28
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PROPOSAL 1 — ELECTION OF DIRECTORS
Under the procedures, management determines whether a proposed transaction requires review under the policy and, if so, presents the transaction to the Governance and Nominating Committee. The Governance and Nominating Committee reviews the relevant facts and circumstances of the transaction and approves or rejects the transaction. If the proposed transaction is immaterial or it is impractical or undesirable to defer the proposed transaction until the next committee meeting, the Chair of the committee decides whether to (i) approve the transaction and report the transaction at the next meeting or (ii) call a special meeting of the committee to review and approve the transaction. Should the proposed transaction involve the CEO or enough members of the Governance and Nominating Committee to prevent a quorum, the disinterested members of the committee will review the transaction and make a recommendation to the Board, and the disinterested members of the Board will then approve or reject the transaction. No director may participate in the review of any transaction in which he or she is a related person.
Communication with Directors
The Audit Committee has established procedures for (i) the receipt, retention and treatment of complaints regarding accounting, internal accounting controls or auditing matters (“accounting matters”) and (ii) the confidential, anonymous submission by employees of concerns regarding questionable accounting matters. Such complaints or concerns may be submitted to Dover, care of our Corporate Secretary or through the communications coordinator, an external service provider, by mail, fax, telephone, or via the internet as published on our website. The communications coordinator forwards such communications to Dover without disclosing the identity of the sender if anonymity is requested.
Shareholders and other interested persons may also communicate with our Board and the non-management directors in any of these same manners. Such communications are forwarded to the Chair of the Governance and Nominating Committee.
DOVER CORPORATION – 2024 Proxy Statement 29
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PROPOSAL 1 — ELECTION OF DIRECTORS
Shareholder Engagement and History of Board Responsiveness
Shareholder Engagement
In 2023, we continued our focus on regularly engaging with our shareholders. We reached out to holders of approximately 54% of our shares outstanding, and engaged with governance professionals and/or portfolio managers at investors holding approximately 27% of our shares outstanding. Our shareholder engagement team consists of senior management and has also included our Lead Independent Director (then our Chair) from time to time. We also participate in various governance forums with our shareholders and regularly engage with shareholders through industry conferences and meetings.
We received feedback from investors on a range of topics, including corporate governance topics such as board composition and board refreshment. We are pleased with the feedback we received with investors on the topics we discussed, and look forward to ongoing engagement with our shareholders in order to continue to incorporate their views into our Board’s decision-making process. We aim to have best-in-class governance and compensation structures at Dover.
|
KEY ITEMS OF DISCUSSION AND FEEDBACK
|
||
|
Performance Long-Term Strategy |
• We reviewed our portfolio of businesses, performance, strategic priorities , and focus on continuing to deliver long-term value to shareholders despite challenging market environments. |
|
|
Capital Allocation |
• We discussed how our balance sheet strength and history of prudent capital allocation serve as differentiating factors that allow us to remain flexible. |
|
|
Diversity Inclusion |
• We discussed how we are taking a thoughtful approach to developing a center-led approach to human capital management and diversity and inclusion .
• Shareholders expressed appreciation for continued transparency on the sustainability portion of our website regarding workforce demographics (gender, ethnicity, age) and our decision to disclose publicly our EEO-1 workforce demographic data. |
|
|
ESG |
• We discussed that we continued to report progress against our science-based targets to reduce our GHG emissions , and our continuing to report progress against our goal of reducing TRIR by 40% by 2025 (from a 2019 baseline year).
• We discussed that, in 2023, we continued to provide detailed disclosure of progress on our ESG goals , continued to refresh our sustainability website and continue to publish against key frameworks (SASB and GRI). |
|
|
Executive Compensation |
• After enhancements to our compensation program in recent years, informed by extensive shareholder feedback, shareholders expressed continued support of our executive compensation program, which ensures continued alignment with our strategy and performance. In addition, they expressed support for continuing to include the effective oversight and management of ESG matters as a strategic objective for our CEO under the AIP. |
|
|
Corporate Governance |
• Our shareholders continued to express their broad support for our governance practices and shareholder rights , including special meeting right, use of annual director elections, Board independence, and thoughtful and active refreshment process.
• Many of our shareholders expressed appreciation of the Board’s recent adoption of an amendment to the Governance and Nominating Committee’s charter to provide for oversight of Dover’s practices on political contributions and lobbying expenses . |
|
DOVER CORPORATION – 2024 Proxy Statement 30
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PROPOSAL 1 — ELECTION OF DIRECTORS
History of Board Responsiveness
We are committed to being responsive to our shareholders as demonstrated by the number of changes we have made over the years based on their input. In direct response to shareholder feedback, over the past 10 years, Dover has adopted and amended our special meeting right, adopted proxy access, implemented meaningful changes to our executive compensation program, removed all our super-majority voting provisions in our charter, adopted a cash severance policy, and enhanced our disclosures to investors. The table below highlights many of the changes to our governance structures and compensation program that have been implemented over the past several years informed by shareholder feedback. These changes specifically address shareholders’ areas of focus and input gathered through our extensive shareholder engagements and outreach efforts.
| Year |
% of Outstanding Shares
|
Actions in Response to Shareholder Feedback | ||||||
|
|
|
2024 |
Ongoing |
✓ Currently engaging with shareholders on corporate governance, executive compensation and sustainability ahead of the 2024 Annual Meeting |
||||
|
2023 |
54% / 27% |
✓ Continued to maintain a refreshed and diverse board by appointing three directors, including one female director and one director who is ethnically diverse ✓ Adopted a cash severance policy ✓ Made several ESG accomplishments including: ✓ Completing our initial set of diversity inclusion goals ✓ Disclosing our EEO-1 workforce demographic data |
||||||
|
2022 |
63% / 39% |
✓ Made several ESG accomplishments including: ✓ Completing one diversity inclusion goal and staying on track to complete the other ✓ Continuing to disclose progress against GHG emissions goals and TRIR reduction goals ✓ Amending Governance and Nominating Committee’s charter to provide for oversight of Dover’s practices on political contributions and lobbying expenses |
||||||
|
2021 |
59% / 31% |
✓ Continued to maintain a refreshed and diverse board by appointing an additional female director ✓ Made several ESG accomplishments including: ✓ Announcing goals to reduce our GHG emissions by 2030 ✓ Undertaking a climate risk assessment aligned with the TCFD reporting framework ✓ Setting new diversity inclusion goals ✓ Establishing a working group of operating companies with a goal of embedding sustainability considerations into product development |
||||||
|
2020 |
Winter: 65% / 15%
Lead-up to 2020 AGM: 51% / 12%
Fall: 59% / 38% |
✓ Implemented for 2020 executive compensation program: ✓ Increased proportion of LTIP dedicated to performance shares and shifted from internal TSR to relative TSR as metric for performance shares ✓ Reduced maximum payout ceiling from 400% to 300% in LTIP ✓ Reduced ownership threshold required to call a special meeting of shareholders to 15% from 25% ✓ Adopted a diversity search policy for external director and CEO searches conducted by third-party search firms ✓ Made several ESG accomplishments including: ✓ A robust materiality assessment to help identify go-forward focus areas ✓ The launch of the sustainability portion of our website ✓ Publication of SASB and GRI indices ✓ Release of an “investor tear sheet” covering key ESG highlights ✓ Increased transparency into workforce demographics |
||||||
|
2019 |
Lead-up to 2019 AGM: 63% / 37%
Fall: 63% / 41% |
✓ Achieved removal of all supermajority provisions through submission of management proposal and comprehensive retail investor campaign ✓ Enhanced disclosure regarding individual strategic objectives and financial metrics in AIP ✓ Adopted comprehensive clawback policy ✓ Incorporated ESG oversight into CEO’s individual strategic objectives in AIP |
||||||
|
2018 |
51% / 32% |
✓ Put forth management proposal to remove supermajority voting provisions alongside comprehensive campaign with retail investors to build support – did not pass |
||||||
|
|
2017 |
53% / 33% |
✓ Updated AIP to 60% financial metrics / 40% strategic objectives from 50% / 50% ✓ Put forth management proposal to remove supermajority voting provisions – did not pass |
|||||
|
|
2016 |
60% / 28% |
✓ Adoption of proxy access ✓ Put forth management proposal to provide shareholders with written consent right – did not pass |
|||||
|
|
2015 |
39% / 24% |
✓ Launch of governance-focused shareholder engagement program |
|||||
|
|
2014 |
- / - |
✓ Adoption of special meeting right |
|||||
DOVER CORPORATION – 2024 Proxy Statement 31
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PROPOSAL 1 — ELECTION OF DIRECTORS
Environmental, Social, and Governance Oversight (ESG)
Throughout our history, our commitment to corporate responsibility and sustainability has created significant value for our shareholders and stakeholders. Our vision for sustainability at Dover is “a sustainable innovation for every customer challenge.” This vision helps guide our efforts across our portfolio of operating companies and a team of over 25,000 employees. We remain focused on operating sustainably to help meet the goals of our customers, realize the full potential of our employees by fostering a culture that supports and values their efforts, and strengthen the communities in which we operate. For more information on our initiatives and accomplishments, please visit https://www.dovercorporation.com/sustainability/overview.
ESG Areas of Focus and Materiality Analysis
We pursue sustainability initiatives that support our employees, customers, and communities to ensure our businesses continue to create long-term value for our shareholders. Our eighteen ESG areas of focus — identified and prioritized in our materiality analysis conducted in 2020 – represent the ESG issues most important to our business and stakeholders and continue to guide our sustainability strategy. Please see below for the specific areas of focus identified through the analysis. For each sustainability topic, we are applying our resources, expertise, and innovation to improve outcomes and drive results.
DOVER CORPORATION – 2024 Proxy Statement 32
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PROPOSAL 1 — ELECTION OF DIRECTORS
Governance Oversight of ESG
Our governance framework serves as a strong foundation to promote the long-term interests of our shareholders. Our Board oversees our long-term strategic development and enterprise risk, including ESG risks. The Board’s oversight spans a wide array of ESG issues, including those related to climate change, health and safety, diversity and inclusion, ethics and compliance, and long-term environmental protection. As part of its continued focus on sustainability, our Board incorporates ESG oversight into the CEO’s annual performance and compensation evaluation as one of the CEO’s strategic objectives. The Board also has established a comprehensive enterprise risk management process to identify and manage risks, including any risks related to environmental and social issues.
Additionally, our cross-functional management-level Sustainability Steering Committee was established in 2020 to manage ESG issues, typically meets at least four times per year, and provides an update to the Board at least annually. In 2022, we formalized the organization and structure of the Sustainability Steering Committee in a committee charter. The committee is responsible for guiding our sustainability strategy, initiatives, target-setting, performance, and reporting.
DOVER CORPORATION – 2024 Proxy Statement 33
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PROPOSAL 1 — ELECTION OF DIRECTORS
Progress Toward Goals
We made progress on a number of fronts toward our ESG goals. These goals include our 2030 science-based targets to reduce both our operational and value chain greenhouse gas emissions as well as our goals to promote employee health and safety and diversity and inclusion. We continue to disclose progress against our greenhouse gas emissions and TRIR reduction goals. Also, as part of our efforts around increasing our focus on developing products that help our customers meet their sustainability goals, we have put in place working groups to develop and share best practices for embedding sustainability considerations into new product development. In addition, as of the end of 2023, we have completed our initial diversity and inclusion goals of launching a global employee engagement survey and training at least 80% of our people leaders on unconscious bias.
We highlight key initiatives and performance metrics about our sustainability activities under the “Sustainability” tab on our website.
DOVER CORPORATION – 2024 Proxy Statement 34
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PROPOSAL 1 — ELECTION OF DIRECTORS
Directors’ Compensation
Our non-employee directors’ annual compensation is payable partly in cash and partly in common stock in an allocation our Board may adjust from time to time. If any director serves for less than a full calendar year, the compensation to be paid to that director for the year will be pro-rated as deemed appropriate by our Compensation Committee.
Our Board has adopted a policy that directors are expected to hold at any time a number of shares at least equal to the aggregate number of shares they received as the stock portion of their annual retainer during the past five years, net of an assumed 30% tax rate.
|
FOR 2023, NON-EMPLOYEE DIRECTOR COMPENSATION WAS AS FOLLOWS: |
|
Annual retainer of $285,000, payable $165,000 in common stock and $120,000 in cash |
|
Audit Committee Chair — additional annual cash retainer of $30,000 |
|
Compensation Committee Chair — additional annual cash retainer of $20,000 |
|
Governance and Nominating Committee Chair and Finance Committee Chair — additional annual cash retainer of $15,000 |
|
Board Chair — additional annual retainer of $170,000, payable $130,000 in cash and $40,000 in common stock |
Under our 2021 LTIP, each non-employee director can elect to defer the receipt of 0%, 50%, or 100% of the equity compensation payable in a year until termination of services as a non-employee director. Shares deferred are converted into deferred stock units representing the right to receive one share of our common stock for each unit held at the end of the deferral period. Dividend equivalents are credited on deferred stock units and will be distributed in cash at the time that shares are distributed in settlement of deferred stock units. Messrs. Howze, Johnston, Manley, Spiegel, and Todd and Mses. Graham and DeHaas elected to defer receipt of their 2023 equity compensation and received deferred stock units.
The table below sets forth the compensation paid to our directors for services in 2023.
|
NAME |
FEES EARNED OR PAID IN CASH ($)(1) |
STOCK AWARDS ($)(2) |
TOTAL ($) |
|||||||||
|
DEBORAH L. DEHAAS |
|
120,000 |
|
|
165,069 |
|
|
285,069 |
|
|||
|
H. JOHN GILBERTSON, JR |
|
120,000 |
|
|
165,069 |
|
|
285,069 |
|
|||
|
KRISTIANE C. GRAHAM |
|
120,000 |
|
|
165,069 |
|
|
285,069 |
|
|||
|
MARC A. HOWZE |
|
19,397 |
|
|
26,656 |
|
|
46,053 |
|
|||
|
MICHAEL F. JOHNSTON |
|
259,877 |
|
|
205,052 |
|
|
464,929 |
|
|||
|
MICHAEL MANLEY |
|
107,178 |
|
|
147,438 |
|
|
254,616 |
|
|||
|
DANITA K. OSTLING |
|
49,644 |
|
|
68,304 |
|
|
117,948 |
|
|||
|
ERIC A. SPIEGEL |
|
135,000 |
|
|
165,069 |
|
|
300,069 |
|
|||
|
STEPHEN M. TODD |
|
150,000 |
|
|
165,069 |
|
|
315,069 |
|
|||
|
STEPHEN K. WAGNER |
|
67,500 |
|
|
66,083 |
|
|
133,583 |
|
|||
|
KEITH E. WANDELL |
|
140,000 |
|
|
165,069 |
|
|
305,069 |
|
|||
|
MARY A. WINSTON |
|
60,000 |
|
|
66,083 |
|
|
126,083 |
|
|||
| (1) |
Amounts include the standard annual cash retainer, the Chair’s additional cash retainer, and the additional annual cash retainer for committee Chairs earned or paid in 2023. Ms. Winston and Mr. Wagner retired from the Board effective as of the 2023 Annual Meeting. Mr. Manley, Ms. Ostling and Mr. Howze were first elected to the Board on, respectively, February 9, 2023, August 3, 2023, and November 3, 2023. Their compensation reflects their partial year of service. Mr. Johnston was elected Chair of the Governance and Nominating Committee in May 2023 and earned a pro rata portion of the additional annual cash retainer as Chair of that committee. |
DOVER CORPORATION – 2024 Proxy Statement 35
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PROPOSAL 1 — ELECTION OF DIRECTORS
| (2) |
On November 15, 2023, each of Messrs. Gilbertson and Wandell received 1,189 shares of common stock with an aggregate grant date fair market value of $165,069; Ms. Ostling received 492 shares of common stock with an aggregate grant date fair market value of $68,304; Messrs. Spiegel, Todd and Mses. Graham and DeHaas each received 1,189 deferred stock units with an aggregate grant date fair market value of $165,069; Mr. Howze received 192 deferred stock units with an aggregate grant date fair market value of $26,656; Mr. Manley received 1,062 deferred stock units with an aggregate grant date fair market value of $147,438, and Mr. Johnston received 1,477 deferred stock units with an aggregate grant date fair market value of $205,052, which included his additional compensation as Board Chair. |
Our Compensation Committee reviews our non-employee director compensation policy biennially and proposes changes to the Board, as appropriate. In reviewing the non-employee director compensation policy in 2024, our Compensation Committee worked with its independent compensation consultant to assess the competitiveness of our non-employee director compensation policy based on benchmark information from peer companies and relevant compensation surveys. Based on its review, our Compensation Committee proposed and the Board adopted the following changes to our non-employee director compensation policy to be effective in 2024: an increase by $20,000 of the annual retainer for non-employee directors, payable $10,000 in cash and $10,000 in common stock, and an increase by $5,000 of the additional annual cash retainer for the Compensation Committee Chair and Governance and Nominating Committee Chair. In addition, the Lead Independent Director will receive an additional annual retainer of $50,000, payable in cash.
DOVER CORPORATION – 2024 Proxy Statement 36
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Proposal 2 — Ratification of Appointment of Independent Registered Public Accounting Firm
The Audit Committee has appointed the independent registered public accounting firm of PwC to audit the annual accounts of Dover and its subsidiaries for 2024. PwC has audited the financial statements for the Company since 1995. Representatives of PwC are not expected to be present at the Annual Meeting.
Although shareholder ratification of PwC’s appointment is not required by Dover’s by-laws or otherwise, our Board is submitting the ratification of PwC’s appointment for the year 2024 to Dover’s shareholders. If the shareholders do not ratify the appointment of PwC, the Audit Committee will reconsider whether or not to retain PwC as Dover’s independent registered public accounting firm for the year 2024 but will not be obligated to terminate the appointment. Even if the shareholders ratify the appointment of PwC, the Audit Committee in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if the Audit Committee determines that such a change would be in Dover’s interests.
THE BOARD RECOMMENDS A VOTE “FOR” RATIFICATION OF THE APPOINTMENT
OF PWC AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE YEAR 2024.
DOVER CORPORATION – 2024 Proxy Statement 37
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PROPOSAL 2 — RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Audit Committee Report
|
The Audit Committee is composed of directors who, in the opinion of the Board, are independent and financially literate under NYSE rules and all of whom, with the exception of Mr. Howze, qualify as audit committee financial experts as defined by the SEC. Information concerning the credentials of the Audit Committee members can be found in the section of this proxy statement entitled “Proposal 1 — Election of Directors”.
The Audit Committee operates under a written charter adopted by the Board and available on Dover’s website. The Audit Committee assists the Board in overseeing the quality and integrity of Dover’s financial statements, compliance with legal and regulatory requirements, the qualifications, performance and independence of the independent auditors, and the performance of the internal audit function.
Among other things, the Audit Committee appoints the Company’s independent auditors and is directly involved in the selection of the lead audit engagement partner, discusses with the internal audit function and independent auditors the overall scope and plans for their respective audits, reviews the Company’s accounting policies and system of internal controls, reviews significant financial transactions, discusses with management and with the Board processes relating to risk management, pre-approves audit and permissible non-audit services provided by the independent auditors, and approves all fees paid to the independent auditors for such services.
For 2023, the Audit Committee engaged the independent registered public accounting firm PwC as Dover’s independent auditor. In selecting PwC, the Audit Committee considered, among other things: the experience and qualifications of the lead audit partner and other senior members of the PwC team; PwC’s historical performance on Dover’s audit and the quality of its communications with the Audit Committee; the results of the most recent internal quality control review or Public Company Accounting Oversight Board (“PCAOB”) inspection; PwC’s independence; its reputation for integrity and competence in the fields of accounting and auditing; the appropriateness of its fees; and its tenure as Dover’s independent auditors, including its understanding of the Company’s global businesses, accounting policies and practices, and internal control over financial reporting.
The Audit Committee discussed with PwC the overall scope and plans for the audit of Dover’s 2023 financial statements. The Audit Committee met with PwC, with and without management present, to discuss the results of PwC’s examination, their assessment of internal controls and the overall quality of financial reporting.
The Audit Committee reviewed and discussed, with both the management of Dover and PwC, Dover’s 2023 audited financial statements, including a discussion of critical accounting policies, the quality, not just the acceptability, of the accounting principles followed, the reasonableness of significant judgments reflected in such financial statements and the clarity of disclosures in the financial statements. The Audit Committee met a total of eight times in 2023 and 2024 to discuss 2023 quarterly and full-year financial results and related disclosures.
The Audit Committee has received the written disclosures and the Rule 3526 letter from PwC required by the applicable requirements of PCAOB regarding the independent auditor’s communications with the Audit Committee concerning independence, and discussed with PwC its independence, including the impact of any relationships or permitted non-auditing services on PwC’s independence. The Audit Committee also discussed with PwC the matters required to be discussed under PCAOB Auditing Standard No. 1301. The Audit Committee has also received written materials addressing PwC’s internal control procedures and other matters required by NYSE listing standards.
Based upon the review and discussions referred to above, the Audit Committee recommended that the audited financial statements for the year ended December 31, 2023, be included in Dover’s Annual Report on Form 10-K.
Audit Committee:
Stephen M. Todd (Chair) Deborah L. DeHaas Marc A. Howze Michael Manley Danita K. Ostling Eric A. Spiegel
This report does not constitute “soliciting material” and shall not be deemed filed or incorporated by reference into any filing under the Securities Act of 1933 or under the Securities Exchange Act of 1934, except to the extent we specifically incorporate this report by reference and shall not otherwise be deemed filed under such Acts.
|
DOVER CORPORATION – 2024 Proxy Statement 38
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PROPOSAL 2 — RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Fees Paid to Independent Registered Public Accounting Firm
Fees paid to, or accrued for, PwC for services to us and our subsidiaries for 2023 and 2022 (including reimbursable expenses) were as follows:
|
2023 |
2022 |
|||||||
|
AUDIT FEES |
$ |
6,943,000 |
|
$ |
6,367,600 |
|
||
|
AUDIT-RELATED FEES |
$ |
29,789 |
|
$ |
2,533 |
|
||
|
TAX FEES |
$ |
15,945 |
|
$ |
39,078 |
|
||
|
ALL OTHER FEES |
$ |
4,880 |
|
$ |
5,400 |
|
||
|
|
|
|
|
|||||
|
TOTAL |
$ |
6,993,614 |
|
$ |
6,414,611 |
|
||
Audit Fees. Audit fees include fees for audit or review services in accordance with generally accepted auditing standards of our consolidated financial statements (including internal control over financial reporting), statutory and subsidiary audits and review of documents filed with the U.S. Securities and Exchange Commission (“SEC”).
Audit-Related Fees . Audit-related fees include fees for assurance and related services that are reasonably related to the audit of our financial statements, including system implementation assessments.
Tax Fees . Tax fees include fees for services that are performed by professional tax staff other than in connection with the audit. These services include tax compliance, consulting and advisory services.
All Other Fees . Other fees include fees for non-audit services not listed above that do not impair the independence of the auditor and are not prohibited by the SEC or PCAOB.
Pre-Approval of Services Provided by Independent Registered Public Accounting Firm
Consistent with its charter and applicable SEC rules, our Audit Committee pre-approves all audit and permissible non-audit services provided by PwC to us and our subsidiaries. With respect to certain services which PwC has traditionally provided, the Audit Committee has adopted specific pre-approval policies and procedures. In developing these policies and procedures, the Audit Committee considered the need to ensure the independence of PwC while recognizing that, in certain situations, PwC may possess the expertise and be in the best position to advise us and our subsidiaries on issues and matters other than accounting and auditing.
The policies and procedures adopted by the Audit Committee allow the pre-approval by the Audit Committee of permissible audit-related services, non-audit-related services and tax services. Under the policies and procedures, pre-approval is generally provided for up to one year and any general pre-approval is detailed as to the particular services or category of services and is subject to a specific budget for each of them. The policies and procedures require that any other services be expressly and separately approved by the Audit Committee prior to such services being performed by the independent auditors. In addition, pre-approved services which are expected to exceed the budgeted amount included in a general pre-approval require separate, specific pre-approval. For each proposed service, the independent auditors and management are required to provide detailed information to the Audit Committee at the time of approval. The Audit Committee considers whether each pre-approved service is consistent with the SEC’s rules and regulations on auditor independence.
All audit-related and non-audit-related services of PwC during 2023 listed above under “Fees Paid to Independent Registered Public Accounting Firm” were pre-approved specifically or pursuant to the procedures outlined above. With respect to any tax services provided by PwC, PwC provided to the Audit Committee the communications required under PCAOB Rule 3524.
DOVER CORPORATION – 2024 Proxy Statement 39
Table of Contents
Compensation Discussion and Analysis
This Compensation Discussion and Analysis (“CDA”) describes our compensation program and how it operates for our NEOs. Our NEOs for 2023 were:
|
|
NAMED EXECUTIVE OFFICERS | |
|
RICHARD J. TOBIN |
President CEO |
|
|
BRAD M. CEREPAK |
Senior Vice President CFO |
|
|
GIRISH JUNEJA |
Senior Vice President Chief Digital Officer |
|
|
IVONNE M. CABRERA |
Senior Vice President General Counsel |
|
|
KIMBERLY K. BORS |
Senior Vice President Chief Human Resources Officer |
|
Executive Summary
Our compensation program is based on a pay-for-performance philosophy and is designed to incentivize executives to achieve financial and strategic goals that are aligned with the Company’s long-term business strategy and the creation of sustained, long-term value for our shareholders.
2023 Performance Results
In 2023, we:
| ✓ |
Delivered GAAP earnings per share of $7.52, up 1% compared to the prior year, and adjusted earnings per share of $8.80, up 4% compared to the prior year. |
| ✓ |
Increased our quarterly dividend, marking our 68 th consecutive year of dividend increases. |
| ✓ |
Acquired two businesses for a total of $535.3 million, net of cash acquired and including contingent consideration, which complement and expand upon our existing operations. |
| ✓ |
Entered into a definitive agreement to sell our De-Sta-Co business, which we expect to complete by the end of the first quarter of 2024, as part of the regular review of our portfolio. This transaction will allow us to concentrate our efforts and capital deployment on growing core platforms. |
| ✓ |
Generated cash flow provided by operating activities of $1,336.3 million, and free cash flow of $1,143.8 million, representing 14% of revenue. |
| ✓ |
Continued to evolve our operating model to include center-led value capture from digital opportunities, and continued to invest in growth and productivity initiatives, including automation, capacity expansion, and the implementation of common corporate systems and measurement tools. |
| ✓ |
Took proactive action to balance production in line with demand trends and position us for forecasted 2024 demand. |
DOVER CORPORATION – 2024 Proxy Statement 40
Table of Contents
COMPENSATION DISCUSSION AND ANALYSIS
Financial Performance Summary
| (1) |
Definitions and reconciliations of non-GAAP measures are included at the end of this proxy statement. |
| (2) |
Source: Capital IQ |
2023 Pay Decisions Align with Dover’s Performance
Our compensation program structure is designed to align pay outcomes with our shareholders’ experience by emphasizing variable, at-risk pay for our management team, including the NEOs, through our AIP and long-term incentive program.
For 2023, our pay decisions and outcomes were consistent with our pay-for-performance philosophy. Our NEOs made significant progress against their pre-defined individual strategic objectives as evaluated by our Compensation Committee under our AIP. As a result of strong operational and strategic achievements, 2023 annual bonus payouts were modestly above target but below last year. Consistent with our value creation over the three-year performance period of 2021-2023, the performance shares for that period, which vested at the end of 2023 and were based on relative TSR to the companies in the SP 500 Industrials index, had a payout percentage of 76.6% for our NEOs.
DOVER CORPORATION – 2024 Proxy Statement 41
Table of Contents
COMPENSATION DISCUSSION AND ANALYSIS
Say on Pay Vote Results and Shareholder Engagement
| 93% Say on Pay support | 54% Shares Outstanding Contacted | 27% Shares Engaged | ||
Our Board has a strong history of engaging with shareholders and soliciting feedback on a range of topics, including our executive compensation program. Historically, our program has received strong shareholder support as expressed during our one-on-one engagement discussions with shareholders and through our Say on Pay vote levels.
At our 2023 annual meeting, approximately 93% of the voting shareholders approved the compensation of the NEOs. In 2023, we continued our shareholder engagement program, reaching out to holders of approximately 54% of our outstanding shares and engaging with governance professionals and/or portfolio managers of investors holding approximately 27% of our outstanding shares. In addition to the governance topics detailed earlier in this proxy statement, we had thoughtful discussions with our shareholders regarding our compensation program. Shareholders indicated that they believe our pay aligns with performance, and expressed support for our program structure and approach, and did not share any significant concerns. The Compensation Committee will continue to consider feedback from shareholders, as well as the results from future shareholder advisory votes, in its ongoing evaluation of executive compensation programs and practices at Dover.
DOVER CORPORATION – 2024 Proxy Statement 42
Table of Contents
COMPENSATION DISCUSSION AND ANALYSIS
Dover’s Alignment with Leading Compensation Governance Practices
|
WHAT WE DO |
||
|
✓ The majority of target NEO pay opportunity is performance based (75% for the CEO; 62% for the other NEOs)
✓ A significant portion of target NEO pay opportunity is tied to Dover stock performance (75% for the CEO; 50% for the other NEOs)
✓ Robust engagement with shareholders to seek feedback on executive compensation programs
✓ Compensation program includes ESG objectives
✓ All long-term incentives are paid in stock, not cash
✓ Executives must hold significant amounts of Dover stock: five-times salary for the CEO, three-times for other NEOs
✓ All long-term incentives are earned or vest over three years
✓ Change in control provisions require double trigger
✓ Comprehensive clawback policy
✓ Executives participate in benefit and employee programs on the same basis as other Dover employees
✓ Our Compensation Committee retains its own independent consultant
✓ Annual compensation risk assessment
|
||
|
WHAT WE DON’T DO |
||
|
✗ No tax gross ups
✗ No repricing, reloads, or exchanges of stock-settled stock appreciation rights (“SSARs”)
✗ No SSARs granted below fair market value
✗ No hedging or pledging of Dover securities by executives, including margin loans
✗ No dividends are paid on performance shares or restricted stock units (“RSUs”) during the earning or vesting period. Dividend equivalents are accrued on RSUs, but are only paid if the RSUs vest
✗ No special executive retirement arrangements
✗ No NEO cash severance over 2.99x the sum of base salary and target bonus without shareholder approval
✗ No substantial executive perquisites, nor do we own or operate any corporate aircraft
|
||
DOVER CORPORATION – 2024 Proxy Statement 43
Table of Contents
COMPENSATION DISCUSSION AND ANALYSIS
Compensation Principles
Guiding Principles for Dover’s Executive Compensation Program
Based on these principles, these were the key elements of our executive compensation program in 2023:
| ✓ |
Financial metrics that are clearly linked to the creation of shareholder value: adjusted earnings and three-year relative TSR. |
| ✓ |
A focus on our business strategy to ensure our long-term compensation program aligns the interests of our executives with those of our shareholders by placing an emphasis on performance-based stock compensation. |
| ✓ |
An annual review by our Compensation Committee of executive compensation levels and the components of our program. |
| ✓ |
A reference to the median of our peer group for total direct compensation, with consideration for internal pay equity, sustained performance, specific responsibilities, and experience with comparable market talent. |
| ✓ |
Total compensation opportunities designed so that the large majority of compensation is variable and at-risk based on financial, strategic, operational, and share price performance. |
| ✓ |
An annual cash bonus plan (the AIP) designed to reward annual financial performance and the attainment of well-defined strategic objectives that the Board believes will assure the long-term success of Dover. |
| ✓ |
Executive benefits and programs that are consistent with those offered to other employees. We provide no substantial executive perquisites, nor do we own or operate any corporate aircraft. |
DOVER CORPORATION – 2024 Proxy Statement 44
Table of Contents
COMPENSATION DISCUSSION AND ANALYSIS
Compensation Process
Setting Executive Compensation — Roles
The process for determining our executive compensation program structure and payouts involves the dedicated participation of our Compensation Committee, the independent directors of the Board, the CEO, and our Compensation Committee’s independent consultant. The roles of each in making compensation decisions are:
DOVER CORPORATION – 2024 Proxy Statement 45
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COMPENSATION DISCUSSION AND ANALYSIS
Setting Executive Compensation – Timeline
The process for making executive compensation decisions for 2023 began with goal setting at the beginning of the year and concluded with the actual compensation payout decisions in early 2024. As described below in a summary of the Compensation Committee’s process and timing for determining CEO pay, this year-long process integrates key factors, such as our business strategy, our annual budget, and market compensation data.
DOVER CORPORATION – 2024 Proxy Statement 46
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COMPENSATION DISCUSSION AND ANALYSIS
Executive Compensation Program Peer Group
For assessing executive pay programs and levels, the Compensation Committee selected a group of companies that are similar to Dover in terms of end markets, complexity, revenues and market capitalization. In 2023, with the help of its independent consultant, the Compensation Committee reviewed the peer group and made no changes to the group.
|
COMPANY
|
2023
REVENUE |
2023
MARKET CAP(1) |
INDUSTRY |
20%
GLOBAL REVENUES |
DOVER-LIKE
STRUCTURE |
SAME ANALYST
COVERAGE(2) |
||||||||||
|
AMETEK, INC. |
$ | 6,597 | $ | 38,056 |
Electrical
Equipment |
✗ | ✗ | |||||||||
|
CARLISLE COMPANIES INC. |
$ | 4,587 | $ | 15,171 |
Industrial
Conglomerates |
✗ | ||||||||||
|
CORNING INCORPORATED |
$ | 12,588 | $ | 25,979 |
Electrical
Equipment |
✗ | ||||||||||
|
EATON CORPORATION PLC |
$ | 23,196 | $ | 96,159 |
Electrical
Equipment |
✗ | ✗ | |||||||||
|
EMERSON ELECTRIC CO. |
$ | 15,165 | $ | 55,626 |
Electrical
Equipment |
✗ | ✗ | |||||||||
|
FLOWSERVE CORPORATION
|
$
|
4,321
|
|
$
|
5,408
|
|
Machinery
|
✗
|
||||||||
|
FORTIVE CORPORATION |
$ | 6,065 | $ | 25,876 |
Industrial
Machinery |
✗ | ✗ | |||||||||
|
ILLINOIS TOOL WORKS INC.
|
$
|
16,107
|
|
$
|
78,814
|
|
Machinery
|
✗
|
✗
|
|||||||
|
INGERSOLL-RAND INC
|
$
|
6,876
|
|
$
|
31,307
|
|
Machinery
|
✗
|
✗
|
|||||||
|
PARKER-HANNIFIN CORPORATION
|
$
|
19,065
|
|
$
|
59,189
|
|
Machinery
|
✗
|
||||||||
|
ROCKWELL AUTOMATION INC. |
$ | 9,058 | $ | 35,575 |
Electrical
Equipment |
✗ | ||||||||||
|
ROPER TECHNOLOGIES, INC. |
$ | 6,178 | $ | 58,236 |
Industrial
Conglomerates |
✗ | ✗ | |||||||||
|
SNAP-ON INCORPORATED |
$ | 5,108 | $ | 15,245 |
Industrial
Machinery |
✗ | ||||||||||
|
STANLEY BLACK DECKER, INC. |
$ | 15,781 | $ | 15,040 |
Industrial
Machinery |
✗ | ||||||||||
|
TEXTRON INC. |
$ | 13,683 | $ | 15,763 |
Aerospace
Defense |
✗ | ✗ | |||||||||
|
XYLEM, INC. |
$ | 7,364 | $ | 27,570 |
Industrial
Machinery |
✗ | ||||||||||
|
75TH PERCENTILE |
$ | 15,319 | $ | 56,279 |
|
|||||||||||
|
MEDIAN |
$ | 8,211 | $ | 29,438 |
|
|||||||||||
|
25TH PERCENTILE |
$ | 6,150 | $ | 15,633 |
|
|||||||||||
|
DOVER |
$ | 8,438 | $ | 21,517 |
|
|||||||||||
| (1) |
As of 12/31/2023. |
| (2) |
“Same analyst coverage” means company is covered by at least five of the analysts that cover Dover. |
DOVER CORPORATION – 2024 Proxy Statement 47
Table of Contents
COMPENSATION DISCUSSION AND ANALYSIS
Role of Internal Equity in Setting Executive Compensation
Management and our Compensation Committee consider both market benchmarks (i.e., external competitiveness), as well as the impact each executive role has relative to internal peers (i.e., internal equity), in establishing the executive pay structures used to govern pay.
Retention and Independence of Compensation Consultant
Our Compensation Committee has the authority and discretion to retain external compensation consultants as it deems appropriate. Our Compensation Committee has adopted a policy to ensure the continuing independence and accountability to the committee of any advisor hired to assist the committee in the discharge of its duties. The policy formalizes the independent relationship between the Compensation Committee’s advisor and Dover, while permitting management limited ability to access the advisor’s knowledge of Dover for compensation matters. Under the policy, our Compensation Committee annually reviews and pre-approves the services that may be provided to management by the independent advisor without further Compensation Committee approval. Compensation Committee approval is required prior to Dover retaining the independent advisor for any executive compensation services or other consulting services or products above an aggregate annual limit of $50,000.
Since September 2020, our Compensation Committee has retained Meridian Compensation Partners, LLC (“Meridian”) to serve as its independent compensation consultant. Meridian does no other work for and has no other relationships with Dover. Meridian is focused on executive compensation and does not have departments, groups, or affiliates that provide services other than those related to executive compensation and benefits.
Our Compensation Committee looks to its consultant to periodically review and advise on the adequacy and appropriateness of our overall executive compensation plans, programs, and practices and, from time to time, to answer specific questions raised by our Compensation Committee or management. Compensation decisions are made by, and are the responsibility of, our Compensation Committee and our Board, and may reflect factors and considerations other than the information and recommendations provided by our Compensation Committee’s consultant.
To ensure independence of the compensation consultant, the consultant reports directly to the Chair of our Compensation Committee and works specifically for the Compensation Committee solely on compensation and benefits.
Meridian did not engage in any projects for management in 2023. Our Compensation Committee has assessed the independence of Meridian and concluded that its work for the Compensation Committee does not raise any conflict of interest.
DOVER CORPORATION – 2024 Proxy Statement 48
Table of Contents
COMPENSATION DISCUSSION AND ANALYSIS
Elements of Executive Compensation
Variable, Performance-Based Compensation Program Structure Drives Pay-For-Performance Alignment
The pay packages of Dover executives consist predominantly of incentive-based pay, both annual and long-term. Each of the compensation components has a specific role in the overall design of our executive pay program. While the components are designed to be mutually reinforcing, care is taken to minimize overlap between them. The following table provides an overview of the 2023 compensation program structure.
|
Component |
Pay Element | 2023 Metrics Weighting | Objectives | |||
|
Base Salary
|
Cash
|
◾ n/a
|
◾ Attract and retain qualified executives
◾ Benchmarked to peer group median while also considering additional factors such as experience and performance in role
|
|||
|
Annual Incentive Plan (AIP) |
Cash |
◾ 60% Financial Results:
○ Adj. Earnings (100%)
◾ 40% Individual Strategic
○ Specific strategic initiatives deemed to be important to achieve in 2023
○ ESG oversight included in CEO and select NEO individual strategic objectives
|
◾ Intended to drive profitability, growth, and progress against strategy
◾ Individual objectives are focused on a limited and measurable set of goals to benefit shareholders over the long-term
◾ Including ESG oversight in objectives establishes clear tone at the top regarding the importance of ESG
|
|||
|
Long-Term Incentive Plan |
Performance Shares (40%) |
◾ 40% LTIP weighting
◾ Performance Criteria: 3-Year relative TSR with the SP 500 Industrials index companies as the comparator group
|
◾ Focus executives on shareholder value creation
◾ Relative TSR closely aligns our executive-level measurement system with the experience of shareholders
|
|||
|
SSARs (40%) |
◾ 40% LTIP Weighting
◾ Performance Criteria: Dover stock price, exercisable three years after grant date and remain exercisable for another seven years (subject to 10-year stock price movement)
|
◾ Focus executives on share price appreciation
◾ SSARs are an important component of our program, reflecting input from investors, many of whom acknowledge the role SSARs play in emphasizing growth and go-forward value creation
|
||||
|
RSUs (20%) |
◾ 20% LTIP weighting
◾ Performance Criteria: Dover stock price; awards vest ratably over three years
|
◾ Retention, ownership, and full alignment with the shareholder experience |
||||
|
Benefits
|
Consistent with other similarly situated employees
|
|||||
DOVER CORPORATION – 2024 Proxy Statement 49
Table of Contents
COMPENSATION DISCUSSION AND ANALYSIS
2023 Target Pay Mix
For 2023, the vast majority of the CEO’s and other NEOs’ target pay mix was composed of “at risk” incentive-based pay as shown in the chart below. Additionally, the target pay mix was heavily weighted toward long-term performance and tied to share performance, with the annual incentives focused on key short-term drivers and progress on strategy.
Annual Incentive Plan Compensation
An annual bonus may be earned each year based on an NEO’s performance against objectives tied to our financial performance as well as individual strategic goals. Each NEO’s bonus target amount is determined in reference to market benchmarking and according to the scope and complexity of the NEO’s functional responsibilities, overall impact on our results, strategic leadership, and managerial responsibility. We believe that balancing the measurement of performance for the annual bonus between financial and strategic objectives is important in mitigating risk and executing on our long-term strategy for value creation.
Each executive officer is eligible for a bonus equal to his or her base salary multiplied by his or her target award percentage multiplied by the Overall Payout Factor (which is the sum of the Financial Objective Factor (weighted 60%) and the Strategic Objectives Factor (weighted 40%)).
2023 AIP Financial Objective Factor – Target
The Financial Objective Factor in the 2023 AIP was calculated based on Adjusted Earnings. In setting the financial objective, our Compensation Committee considered our annual budget, operational priorities, plans for capital allocation, historical performance, and external factors, among other items. This thorough process is designed to ensure that targets are rigorous and to establish challenging but attainable goals in the context of expectations for the year on the basis of these factors. The target performance level for the financial objective was established at the beginning of the fiscal year and provided for appropriate adjustments for acquisitions and dispositions occurring during the year. For this measure, our Compensation Committee established threshold, target, and maximum levels of performance, as well as a payout percentage curve that relates each level of performance to a payout percentage.
DOVER CORPORATION – 2024 Proxy Statement 50
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COMPENSATION DISCUSSION AND ANALYSIS
Threshold and maximum performance levels are set at 85% and 107%, respectively, of target. There is no payout on the Financial Objective Factor if performance is below the threshold. At threshold, the payout percentage curve begins at 50%. If performance is at the target level, the payout percentage is 100%. For performance at or above the maximum level of achievement, the payout percentage is capped at 200%.
2023 AIP Financial Objective Factor – Results
Following the end of 2023, we calculated the Financial Objective Factor as follows:
|
2023 AIP FINANCIAL OBJECTIVE RESULTS (in millions) |
||||||||||
|
|
TARGET
PERFORMANCE LEVEL |
ACTUAL
PERFORMANCE LEVEL |
PAYOUT%
(BEFORE WEIGHTING) |
WEIGHTING OF MEASURE |
WEIGHTED
PAYOUT% |
|||||
|
Adjusted Earnings (1) |
$1,245.5 |
$1,236.7 |
97.6% |
60% |
58.6% |
|||||
|
Financial Objective Factor |
58.6% |
|||||||||
| (1) |
Definitions and reconciliations of non-GAAP measures are included at the end of this proxy statement. |
2023 AIP Individual Strategic Objectives Factor
The Strategic Objectives Factor is based on the achievement of individual strategic objectives designed to create long-term value for our shareholders. The strategic objectives for the CEO were developed by our Compensation Committee at the beginning of the year, approved by our independent directors, and communicated to the CEO in February. The individual strategic objectives were based on specific strategic initiatives that the Board and management agreed were important to achieve in 2023. These objectives were cascaded to the CEO’s direct reports, as appropriate, based on their responsibilities or business portfolio. The Board monitored progress on the CEO’s strategic objectives and, following the end of the year, reviewed the CEO’s performance against these objectives when determining his annual bonus.
Following the end of 2023, our Compensation Committee determined for each NEO a Strategic Objectives Factor between 0% and 200%. Our Compensation Committee believes such judgment is an important risk-mitigating element to our compensation program and provides an opportunity to further align executive compensation with long-term value creation. To make this determination, our Compensation Committee took into account each executive’s execution against his or her personal strategic objectives for the year and the executive’s overall performance for the year.
DOVER CORPORATION – 2024 Proxy Statement 51
Table of Contents
COMPENSATION DISCUSSION AND ANALYSIS
Strategic Objectives Factor — CEO
The table below summarizes the individual strategic objectives, weightings, and results the Compensation Committee considered for our CEO in determining his Strategic Objectives Factor for 2023.
|
Strategic Objectives Accomplishments – Richard J. Tobin (Chairman, President CEO) |
|
Three Pillars Progression (20%)
|
|
✓ Continued to make progress on productivity and margin expansion initiatives.
|
|
Capital Markets and Shareholder Engagement (20%)
|
|
✓ Presented at multiple industry conferences and conducted an investor day presentation. ✓ Engaged with investors regarding our long-term strategy execution and value-creation priorities. ✓ Reached out to holders of approximately 54% of outstanding shares and engaged with investors holding approximately 27% of outstanding shares.
|
|
Portfolio Management (20%)
|
|
✓ Effectively deployed capital to increase the value of our portfolio, including through investments in organic growth and $535.3 million deployed toward synergistic acquisitions. ✓ Completed the integration of several recent acquisitions that provide exposure to high-growth technologies and markets. ✓ Announced the divestiture of De-Sta-Co business for approximately $680.0 million enterprise value
|
|
Talent, Succession Planning Workforce Diversity (20%)
|
|
✓ Completed several objectives in the multi-year strategy to help ensure that our culture continues to take an inclusive approach that values diversity. ✓ Completed talent and succession planning review. ✓ Provided regular updates to the Compensation Committee on changes to key positions within organizational structure.
|
|
ESG (20%)
|
|
✓ Implemented the first year of the second three-year ESG strategic plan by continuing to report progress toward public facing goals on ESG topics, including GHG emissions. ✓ Completed initial set of public-facing diversity and inclusion goals while helping to prepare the Company to set the next generation of diversity and inclusion goals. ✓ Reviewed progress against ESG plan with the Board, including as a member of Dover’s Sustainability Steering Committee.
|
Our Compensation Committee evaluated Mr. Tobin’s achievements against his strategic objectives and assigned him a Strategic Objectives Factor of 110%.
DOVER CORPORATION – 2024 Proxy Statement 52
Table of Contents
COMPENSATION DISCUSSION AND ANALYSIS
Strategic Objectives Factor — Other NEOs
The following table summarizes the individual strategic objectives and results the Compensation Committee considered for our other NEOs in determining their respective Strategic Objectives Factors for 2023.
|
Brad M. Cerepak (Senior Vice President CFO) Strategic Objectives Accomplishments |
|
Investor Relations (20%) ✓ Conducted successful investor day presentation.
Corporate Strategy (20%) ✓ Evaluated options for capital deployment, including this year though organic reinvestment, MA, and cash dividends (increased annually over each of the last 68 years). ✓ Aligned key metrics and market positions to drive shareholder communications.
Strategic Planning Process (20%) ✓ Made improvements to business unit strategic planning process
Capital Structure Analysis (20%) ✓ Reviewed capital structure options based on projected capital and liquidity needs ✓ Consistent with capital structure plan, put in place new $1.0 billion five-year and $500.0 million 364-day unsecured revolving credit facilities.
Finance Transformation and Control Environment (20%) ✓ Made progress on three-year strategic plan to optimize the structure of our finance team and improve process efficiency of shared services. ✓ Made progress on implementing new financial reporting software.
|
| Assigned Strategic Objectives Factor of 120% |
|
Girish Juneja (Senior Vice President Chief Digital Officer) Strategic Objectives Accomplishments |
|
Digital Strategy (25%) ✓ Supported our strategic initiatives and priorities by assessing the digital capabilities of acquisition targets and driving adoption of shared services and common practices. ✓ Helped progress our information technology centralization initiatives.
Digital Customer Experience (25%) ✓ Continued support in building common platforms to enhance the customer experience and deliver efficiencies by enabling automated transactions.
Data Security (25%) ✓ Supported our enterprise-wide strategy for data security.
Product Development (25%) ✓ Continued support in our connected software and machine learning augmented solutions, which were built to integrate and work with our equipment and component offerings.
|
| Assigned Strategic Objectives Factor of 100% |
DOVER CORPORATION – 2024 Proxy Statement 53
Table of Contents
COMPENSATION DISCUSSION AND ANALYSIS
|
Ivonne M. Cabrera (Senior Vice President, General Counsel Secretary) Strategic Objectives Accomplishments |
|
ESG (25%) ✓ Continued effective leadership of our Sustainability Steering Committee and key roles in driving initiatives and communications aligned with completing the objectives outlined in our new three-year ESG plan.
Board Composition (25%) ✓ Provided strategic support and advice related to the evolution of our Board composition, including through the Board’s appointment of three new directors with diverse backgrounds and skill sets in 2023.
Commercial Contracts, Intellectual Property and MA (25%) ✓ Managed key legal matters relating to continued evolution of our portfolio of companies, intellectual property matters and key commercial contracts
Shareholder Engagement (25%) ✓ Supported evolution of our engagement activities and provided support, advice and leadership in communications with our shareholder base.
|
| Assigned Strategic Objectives Factor of 100% |
|
Kimberly K. Bors (Senior Vice President Chief Human Resources Officer) Strategic Objectives Accomplishments |
|
Enterprise Talent Management Development Renewal (25%) ✓ Continued to enhance our talent management processes, capabilities and succession depth across the enterprise.
Strategic HR Enterprise Initiatives (25%) ✓ Continue to harmonize and streamline aspects of global benefits programs. ✓ Supported the roll out of a global career architecture and compensation structure.
ESG/Workforce Diversity (25%) ✓ Supported pulse surveys at selected operating companies following the successfully completion of our first annual global engagement survey. ✓ Helped implement Diversity Inclusion roadmap initiatives, including by rolling out diversity, equity inclusion training. ✓ Supported expansion of diverse candidate outreach and pipeline at operating company and enterprise levels
HR Transformation (25%) ✓ Made progress on several initiatives related to implementation of the global operating model designed to expand shared services and centers of expertise and improve the operational effectiveness of the human resources function.
|
| Assigned Strategic Objectives Factor of 100% |
The Overall Payout Factors resulting from the above Financial Objective Factors and the Strategic Objectives Factors resulted in the payouts set forth in the 2023 Summary Compensation Table.
DOVER CORPORATION – 2024 Proxy Statement 54
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COMPENSATION DISCUSSION AND ANALYSIS
Long-Term Incentive Compensation
The following table summarizes the components of awards under our LTIP and the related performance criteria for awards granted in 2023. Note that all components are paid in stock rather than cash to encourage shareholder alignment through stock ownership.
| Pay Element | 2023 Weighting Performance Criteria | Objectives | ||
|
Performance Shares |
◾ 40% LTIP weighting
◾ Performance Criteria: 3-Year relative TSR with the SP 500 Industrials index companies as the comparator group |
◾ Focus executives on shareholder value creation |
||
|
Stock Settled Stock Appreciation Rights |
◾ 40% LTIP weighting ◾ Performance Criteria: Dover stock price, exercisable three years after grant date and remain exercisable for seven years (subject to 10-year stock price movement) |
◾ Focus executives on share price appreciation |
||
|
Restricted Stock Units |
◾ 20% LTIP weighting ◾ Performance Criteria: Dover stock price; awards vest ratably over three years |
◾ Retention and full alignment with the shareholder experience |
||
Performance Shares – Relative TSR Metric
In February 2023, the Compensation Committee approved the grant of performance shares to each of our NEOs. Performance shares are earned based on our relative TSR performance against the SP 500 Industrials index companies measured over the three-year performance period ending December 31, 2025. The relative TSR metric provides shareholders with a transparent and simple measure to gauge our performance against companies in our industry and aligns the interests of our executives with our shareholders. The relative TSR targets for our performance shares are highly competitive. Awards are earned three years after the grant, provided relative TSR exceeds a threshold level with a maximum payout capped at 300% of target.
Payouts are made on a sliding scale using the following formula based on our relative TSR performance:
Performance share payouts will be capped at 100% if absolute TSR is negative over the performance period.
DOVER CORPORATION – 2024 Proxy Statement 55
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COMPENSATION DISCUSSION AND ANALYSIS
Performance Shares Vested in 2023
The performance shares vested in 2023 are based on the three-year performance period of 2021-2023, and the performance is measured on relative TSR as described above. Consistent with our value creation over the three-year performance period, the performance shares vested in 2023 had a payout percentage of 76.6% for our NEOs.
|
|
Target # of Shares |
|
Actual Shares Awarded | |||||||||||
|
Richard J. Tobin |
27,703 | 21,220 | ||||||||||||
|
Brad M. Cerepak |
6,926 | 5,305 | ||||||||||||
|
Girish Juneja |
1,630 | 1,249 | ||||||||||||
|
Ivonne M. Cabrera |
2,607 | 1,997 | ||||||||||||
|
Kimberly K. Bors |
1,727 | 1,323 | ||||||||||||
Stock Settled Stock Appreciation Rights
Stock Settled Stock Appreciation Rights (SSARs) give our NEOs the ability to participate in the price appreciation of a set number of shares of Company stock. Once SSARs vest, an NEO may exercise them any time prior to the expiration date and the proceeds from the exercise are paid to the NEO in the form of shares of Dover common stock to encourage continued share ownership and shareholder alignment. SSARs vest and become exercisable 3 years after the grant date and remain exercisable for seven years, which means the awards are subject to 10-year stock price movement thus aligning executive interests with shareholder interests over the long term. Importantly, in light of our active acquisition program, SSARs’ forward-looking orientation is effective for incentivizing our newly-acquired companies and employees, who must create new value in order to realize gains. Furthermore, SSARs’ 10-year life cycle is essential to managing value creation with a business that has a portfolio of industrial companies whose economic cycles vary.
Restricted Stock Units
RSU grants attract and retain NEOs by providing them with some of the benefits associated with stock ownership during the vesting period. Executives do not actually own the shares underlying the units, nor do they enjoy the benefits of ownership such as dividends and voting, until the vesting conditions are satisfied. Once an NEO’s RSUs vest, the NEO receives a number of shares of Dover common stock equivalent in number to the vested units and receives a cash amount equal to any dividend equivalents that were accrued during the vesting period, net of withholding taxes.
Other Benefits
401(k), Pension Plan and Health Wellness Plans
Our executive officers are able to participate in retirement and benefit plans generally available to our employees on the same terms as other employees. Dover and most of our businesses offer a 401(k) plan to substantially all U.S.-based employees and provide a Company matching contribution denominated as a percentage of the amount of salary deferred into the plan by a participant during the course of the year. Some of our U.S.-based employees also participate in a tax-qualified defined benefit pension plan. Effective December 31, 2013, we closed both our qualified and non-qualified defined benefit retirement plans to new employees. As of December 31, 2023, all benefit accruals in both plans were frozen. All of our U.S.-based employees are offered a health and wellness plan (including health, term life and disability insurance). NEOs do not receive enhanced health and wellness benefits.
Non-Qualified Retirement Plans
We offer two non-qualified plans with participation generally limited to individuals whose annual salary and bonus earnings exceed the Internal Revenue Service (“IRS”) limits applicable to our qualified plans: our Pension Replacement Plan (“PRP”) and our deferred compensation plan. Participation in the deferred compensation plan is open to employees with an annual salary equal to or greater than $250,000 for 2023 deferral elections.
DOVER CORPORATION – 2024 Proxy Statement 56
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COMPENSATION DISCUSSION AND ANALYSIS
After December 31, 2009, benefits under the PRP before offsets are determined using the benefit calculation and eligibility criteria as under the pension plan, except that IRS limits on compensation and benefits do not apply. Prior to December 31, 2009, the participants in the PRP accrued benefits greater than those offered in the pension plan. Effective January 1, 2010, we modified this plan so that executives subject to IRS compensation limits will accrue future benefits that are substantially the same as benefits under the pension plan. Individuals who participated in the PRP prior to January 1, 2010 will receive benefits calculated under the prior benefit formula through December 31, 2009 and benefits calculated under the lower PRP benefit formula on and after January 1, 2010. Amounts receivable by the executives under the PRP are reduced by any amounts receivable by them under the pension plan, any qualifying profit sharing plan, Company-paid portion of social security benefits, and the amounts of the Company match in the 401(k) plan.
Effective December 31, 2013, the PRP was closed to new employees. All eligible employees as of December 31, 2013 continued to earn PRP benefits through December 31, 2023 as long as they remain employed by Dover and its affiliates. Effective December 31, 2023, Dover eliminated any benefit accruals consistent with the freezing of benefit accruals under the pension plan.
We offer a deferred compensation plan to allow participants to elect to defer their receipt of some or all of their salary, bonuses and any payout of a cash performance award. The plan permits executive officers to defer receipt of part of their compensation to later periods and facilitates tax planning for the participants. Effective January 1, 2022, the deferred compensation plan was amended to also provide for automatic Company contributions for participants who do not also participate in the PRP or have a present value benefit under the PRP of less than $100,000.
Executive Non-Change-in Control Severance Plan
All of our NEOs are eligible to participate in our severance plan. Under the plan, if we terminate an NEO’s employment without cause (as defined in the severance plan), the NEO will generally be entitled to receive twelve months of salary plus target annual cash bonus, outplacement services, and healthcare benefits continuation, and a prorated annual cash bonus and a prorated performance share award for time worked during the year. In addition, Mr. Tobin is entitled to receive certain severance payments and benefits under his employment agreement in the event his employment is terminated by Dover without cause or by him for good reason. See “Potential Payments Upon Termination or Change in Control.”
Senior Executive Change in Control Severance Plan
Our Senior Executive Change in Control Severance Plan (the “CIC Severance Plan”) establishes the severance benefits payable to eligible executives if they are involuntarily terminated following a change in control. All of our NEOs are eligible to participate in the CIC Severance Plan. An executive eligible to participate in the CIC Severance Plan as of the date of a change in control will be entitled to receive severance payments under the plan if, within 24 months after the change in control, either the executive’s employment is terminated by the Company without “cause” or he or she terminates employment for “good reason” (as such terms are defined in the plan). The severance payments and benefits will consist of: a lump sum payment equal to 2.0 times their annual salary and target bonus, a prorated annual cash bonus at target, full acceleration of all unvested SSARs and RSUs, performance share payout at target for all in-cycle awards, outplacement services, and a lump sum payment equal to the cost of Consolidated Omnibus Budget Reconciliation Act (COBRA) health care benefit continuation of the executive and covered family members for 24 months. See “Potential Payments Upon Termination or Change in Control.” No executive may receive severance benefits under more than one plan or arrangement. Dover does not provide tax gross-ups in the CIC Severance Plan.
Executive Cash Severance Policy
Effective February 9, 2023, the Compensation Committee adopted a new executive officer cash severance policy that applies to any new employment agreement, severance agreement or separation agreement with any executive officer of the Company or any new severance plan or policy covering any executive officer of the Company. The policy provides that cash severance benefits under any such new arrangement will be limited to no more than 2.99 times the sum of the executive officer’s base salary plus target annual bonus, unless approved by shareholders. The Compensation Committee believes that this policy will serve the interests of shareholders while preserving the Company’s ability to remain competitive in the market for talent.
DOVER CORPORATION – 2024 Proxy Statement 57
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COMPENSATION DISCUSSION AND ANALYSIS
Other Elements of Compensation
Clawback Policy
In May 2023, in light of new rules promulgated by NYSE and SEC requirements, the Compensation Committee adopted a new clawback and recoupment policy applicable to our executive officers, effective as of October 2, 2023 (the “Clawback Policy”) that complies with applicable standards. The Clawback Policy provides for the prompt repayment or forfeiture by current or former executive officers of certain erroneously awarded compensation (“Erroneously Awarded Compensation”) received during an applicable three-year lookback period in the event we are required to prepare an accounting restatement of all or a portion of our consolidated financial statements due to material noncompliance with any financial reporting requirement under the securities laws. Erroneously Awarded Compensation for the purposes of the Clawback Policy generally means the amount of incentive-based compensation received during the fiscal period affected by the restatement by such executive officer that exceeds the amount of incentive-based compensation that would have been received by such executive officer had it been determined based on the restated amounts, without regard to any taxes paid. Incentive-based compensation covered under the Clawback Policy generally includes any incentive-based compensation granted, vested or paid to our executive officers at any time during the performance period for the incentive-based compensation and that was received (i) on or after the effective date of the NYSE listing standard, (ii) after the person became an executive officer, and (iii) at a time that we have a class of securities listed on a national securities exchange, and such incentive-based compensation is in general limited to any compensation granted, earned, or vested based wholly or in part on the attainment of one or more financial reporting measures.
The Clawback Policy does not condition clawback on the fault of the executive officer, but we are not required to pursue forfeiture or recovery of amounts in limited circumstances where the Compensation Committee has made a determination that recovery would be impracticable and (i) we have already attempted to recover such amounts but the direct expenses paid to a third party in an effort to enforce the Clawback Policy would exceed the amount to be recovered, (ii) the recovery of amounts would violate applicable home country law, or (iii) the recovery would cause the non-compliance of a tax-qualified retirement plan under the Internal Revenue Code and applicable regulations. We may effect any such recoupment by requiring the executive officer to pay Dover the relevant amount, by set-off, by reducing future compensation or by such other means or combination of means as the Board determines to be appropriate. We may not indemnify any such executive officer against the loss of such recovered compensation.
Apart from the Clawback Policy described above, our PRP includes clawback provisions for termination for cause and the severance plan and CIC Severance Plan provide for clawback of benefits for breaches of the plan.
Anti-hedging and Anti-pledging Policy
Our Securities Trading and Confidentiality Policy prohibits directors, executive officers and any employee who has previously received or receives any type of long-term incentive plan award, and certain persons and entities related to any such persons, from engaging in short-sales, transactions in derivative securities or any other form of hedging transaction designed to hedge or offset any decrease in the market value of Dover securities granted to or held by such persons. In addition, such persons may not hold Dover securities in a margin account or pledge securities as collateral for a loan or any other obligation.
Perquisites
We provide no substantial executive perquisites, other than the payment for executive physicals, nor does the Company own or operate any corporate aircraft. Management and our Compensation Committee believe that providing significant perquisites to executive officers would not be consistent with our overall compensation philosophy. As a result, we do not provide executive officers with perquisites such as social club memberships, company cars or car allowances, or financial counseling.
Shareholding Guidelines
We believe that our executives will most effectively pursue the long-term interests of our shareholders if they are shareholders themselves. As a result, share ownership guidelines are in place for all NEOs (subject to exceptions that may be granted by our Compensation Committee for significant personal events or retirement planning). Our CEO is required to hold shares equal in value to five-times salary and our other NEOs are required to hold shares equal in value to three-times salary. Our policy
DOVER CORPORATION – 2024 Proxy Statement 58
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COMPENSATION DISCUSSION AND ANALYSIS
requires that NEOs hold/retain all equity grants until the share ownership guidelines are met. Based on current share ownership, all executives serving as NEOs are currently in compliance with the guidelines. Our Compensation Committee reserves the right to provide a portion of annual bonus in stock for any officer who fails to meet or make satisfactory progress toward satisfying the guidelines.
Risk Assessment
In 2023, Dover, with the assistance of Willis Towers Watson, conducted a formal risk assessment for all our incentive compensation programs that have a material impact on our financial statements. Willis Towers Watson inventoried incentive compensation programs at the corporate and operating company levels globally and conducted in-depth reviews of financially material plans, identified based on expected spend and income statement accounts tied to the program. The reviews focused on both the plan design features as well as internal risk mitigation controls in place. Based on this assessment, we have concluded that Dover’s compensation practices and policies do not create risks that are reasonably likely to have a material adverse effect on the Company.
DOVER CORPORATION – 2024 Proxy Statement 59
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Compensation Committee Report
|
We reviewed and discussed with management the Compensation Discussion and Analysis for the year ended December 31, 2023.
Based on the review and discussions referred to above, we recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement and incorporated by reference in Dover’s Annual Report on Form 10-K for the year ended December 31, 2023.
|
||||
|
Compensation Committee: |
Keith E. Wandell (Chair) Kristiane C. Graham Michael F. Johnston |
|||
|
This report does not constitute “soliciting material” and shall not be deemed filed or incorporated by reference into any filing under the Securities Act of 1933 or under the Securities Exchange Act of 1934, except to the extent the Company specifically incorporates this report by reference and shall not otherwise be deemed filed under such Acts.
|
||||
DOVER CORPORATION – 2024 Proxy Statement 60
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Executive Compensation Tables
Summary Compensation Table
The Summary Compensation Table and notes show all remuneration for 2023 provided to our NEOs, consisting of the following officers:
| • |
Our President CEO; |
| • |
Our Senior Vice President CFO; and |
| • |
Our three other most highly compensated executive officers as of the end of 2023. |
The determination of the most highly compensated executive officers is based on total compensation paid or accrued for 2023, excluding changes in the actuarial value of defined benefit plans and earnings on nonqualified deferred compensation balances.
| Name and Principal Position | Year |
Salary
($) |
Bonus
($)(1) |
Stock
Awards ($)(2) |
Option
Awards ($)(3) |
Non-Equity
Incentive Plan Compensation ($)(4) |
Change in
Pension Value and Nonqualified Deferred Compensation Earnings ($)(5) |
All Other
Compensation ($)(6) |
Total ($) | |||||||||||||||||||||||||||
|
Richard J. Tobin President Chief Executive Officer |
|
2023 |
|
|
1,292,500 |
|
|
1,999,920 |
|
|
8,086,100 |
|
|
5,209,390 |
|
|
0 |
|
|
0 |
|
|
207,191 |
|
|
16,795,101 |
|
|||||||||
|
|
2022 |
|
|
1,261,250 |
|
|
1,951,101 |
|
|
6,213,263 |
|
|
4,201,489 |
|
|
0 |
|
|
0 |
|
|
516,149 |
|
|
14,143,252 |
|
||||||||||
|
|
2021 |
|
|
1,235,000 |
|
|
2,964,000 |
|
|
5,808,134 |
|
|
3,580,475 |
|
|
0 |
|
|
0 |
|
|
498,251 |
|
|
14,085,860 |
|
||||||||||
|
Brad M. Cerepak Senior Vice President Chief Financial Officer |
|
2023 |
|
|
781,108 |
|
|
842,357 |
|
|
1,808,578 |
|
|
1,165,253 |
|
|
0 |
|
|
471,561 |
|
|
27,179 |
|
|
5,096,036 |
|
|||||||||
|
|
2022 |
|
|
747,448 |
|
|
771,151 |
|
|
1,467,135 |
|
|
992,011 |
|
|
0 |
|
|
0 |
|
|
27,865 |
|
|
4,005,610 |
|
||||||||||
|
|
2021 |
|
|
731,000 |
|
|
1,169,600 |
|
|
1,452,071 |
|
|
895,111 |
|
|
0 |
|
|
182,670 |
|
|
29,577 |
|
|
4,460,029 |
|
||||||||||
|
Girish Juneja Senior Vice President Chief Digital Officer |
|
2023 |
|
|
529,125 |
|
|
369,452 |
|
|
638,514 |
|
|
411,249 |
|
|
0 |
|
|
0 |
|
|
44,246 |
|
|
1,992,586 |
|
|||||||||
|
|
2022 |
|
|
507,500 |
|
|
365,639 |
|
|
517,814 |
|
|
350,107 |
|
|
0 |
|
|
0 |
|
|
43,312 |
|
|
1,784,372 |
|
||||||||||
|
|
2021 |
|
|
500,000 |
|
|
560,000 |
|
|
341,738 |
|
|
210,626 |
|
|
0 |
|
|
0 |
|
|
51,884 |
|
|
1,664,248 |
|
||||||||||
|
Ivonne M. Cabrera Senior Vice President General Counsel |
|
2023 |
|
|
621,700 |
|
|
465,105 |
|
|
851,134 |
|
|
548,379 |
|
|
0 |
|
|
255,662 |
|
|
18,437 |
|
|
2,760,417 |
|
|||||||||
|
|
2022 |
|
|
589,400 |
|
|
460,275 |
|
|
690,353 |
|
|
466,851 |
|
|
0 |
|
|
0 |
|
|
17,484 |
|
|
2,224,363 |
|
||||||||||
|
|
2021 |
|
|
560,000 |
|
|
627,200 |
|
|
546,632 |
|
|
336,979 |
|
|
0 |
|
|
0 |
|
|
17,922 |
|
|
2,088,733 |
|
||||||||||
|
Kimberly K. Bors SVP CHRO |
|
2023 |
|
|
480,900 |
|
|
335,784 |
|
|
553,324 |
|
|
356,416 |
|
|
0 |
|
|
0 |
|
|
41,402 |
|
|
1,767,826 |
|
|||||||||
|
|
2022 |
|
|
460,125 |
|
|
332,302 |
|
|
365,896 |
|
|
247,414 |
|
|
0 |
|
|
0 |
|
|
37,616 |
|
|
1,443,353 |
|
||||||||||
|
|
2021 |
|
|
450,000 |
|
|
504,000 |
|
|
362,136 |
|
|
223,247 |
|
|
0 |
|
|
0 |
|
|
43,615 |
|
|
1,582,998 |
|
||||||||||
| (1) |
Bonus amounts generally represent payments under our AIP for the year indicated, for which payments are made in the first quarter of the following year. The AIP constitutes a non-equity incentive plan under FASB ASC Topic 718. Although they are based on the satisfaction of pre-established performance targets, AIP amounts are reported in the bonus column rather than the non-equity incentive plan compensation column to make clear that they are annual bonus payments for the year indicated. |
| (2) |
The amounts generally represent (a) the aggregate grant date fair value of performance shares granted during the year indicated, and (b) the aggregate grant date fair value of restricted stock unit awards granted during the year, in each case, calculated in accordance with FASB ASC Topic 718. The amounts set forth in the table do not correspond to the actual value that might be realized by the named executives. As market condition awards, the performance share awards were valued using the Monte Carlo simulation model. For a discussion of the valuation of equity awards and related assumptions, see Note 15 to the Notes to the Financial Statements contained in our Annual Report on Form 10-K for the year ended December 31, 2023. |
|
The grant date fair value for the 2021 performance share awards was $148.29 and the grant date fair value for the 2022 performance share awards was $196.40 and the grant date fair value for the 2023 performance share awards was $249.48. The grant date fair value of 2023 RSU awards was $153.25. All RSU grants are eligible for dividend equivalent payments which are paid upon vesting. |
DOVER CORPORATION – 2024 Proxy Statement 61
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EXECUTIVE COMPENSATION TABLES
| (3) |
The amounts represent the aggregate grant date fair value of SSAR awards granted during the year indicated, calculated in accordance with FASB ASC Topic 718, and do not correspond to the actual value that may be realized by the named executives. The grant date fair value for the 2023 SSAR awards was calculated using a Black-Scholes value of $47.27 per SSAR. |
| (4) |
See Note (1) for a discussion of annual bonuses under the AIP as non-equity incentive plan compensation. |
| (5) |
Amounts represent changes in present value of accumulated benefits under the pension plan and/or PRP during the year indicated. For more information, see “Executive Compensation Tables — Pension Benefits through 2023.” |
| (6) |
Amounts for 2023 represent: (i) 401(k) matching contributions of $11,550 for Mr. Cerepak and Ms. Cabrera and $14,850 for Messrs. Tobin and Juneja, and Ms. Bors, (ii) dividends received on RSUs in the amount of $59,032, $14,629, $3,810 and $5,887 and $3,651 for Messrs. Tobin, Cerepak, Juneja and Mses. Cabrera and Bors respectively, and (iii) for Messrs. Tobin and Juneja, and Ms. Bors, respectively, $133,309, $25,586 and $21,901 for the 4.5% non-elective contributions in the nonqualified deferred compensation plan, since they do not participate in the PRP. |
CEO Employment Agreement
In connection with the hiring of Mr. Tobin as our CEO, Mr. Tobin and Dover entered into a three-year employment agreement commencing May 1, 2018, which was renewed in 2021 for a three-year period. In recognition of Mr. Tobin’s outstanding leadership and contributions to value creation, the agreement was renewed effective March 5, 2024 for an additional three-year period ending May 30, 2027. Under the terms of the agreement, Mr. Tobin is entitled to a minimum annual base salary of $1.2 million and a minimum target annual bonus equal to 125% of his base salary, and the receipt of an annual equity grant for each of Dover’s fiscal years ending during the term of the agreement with a grant date fair value of not less than $7 million. During the term of the agreement, Mr. Tobin will also be entitled to employee benefits on the same basis as those generally available to executive officers of Dover. Mr. Tobin is entitled to receive certain severance payments and benefits in the event his employment is terminated by Dover without cause or by him for good reason. See “Potential Payments upon Termination or Change in Control.”
At the end of the term of the agreement, Mr. Tobin will continue to be employed by Dover as an at-will employee and participate in severance and other benefit plans on the same terms as other executives.
CEO Pay Ratio
We are providing the following information about the relationship of the annual total compensation of our Chief Executive Officer and our median employee. This ratio is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K.
Our global headcount was 25,007 employees (12,637 U.S. and 12,370 non-U.S.) as of our December 31, 2023 determination date. Eleven countries were excluded (2.1% of the total workforce) under the permissible 5% exclusion, with employee counts as follows: Argentina (20), Colombia (4), Costa Rica (1), Dominican Republic (71), Indonesia (4), Malaysia (147), Mexico (105), Russian Federation (26), Taiwan (18), Thailand (172), and Turkey (13). After country exclusions, our total headcount was 24,426 employees (12,637 U.S. and 11,789 non-U.S.). As is permitted under the rules, to determine our median employee, we chose “base salary” as our consistently applied compensation measure. We estimated annual base salary for hourly workers employed for the entire year using their hourly rate and a reasonable estimate of hours worked for the year. For employees who commenced work during 2023, we annualized their annual base salary. We then produced a sample of employees who were paid within a 0.5% range of that median and selected an employee from within that group as our median employee. We determined that employee’s (Summary Compensation Table) total compensation was $52,946 for 2023.
We calculated 2023 annual total compensation for both our median employee and Mr. Tobin using the same methodology that we use to determine our named executive officers’ annual total compensation for the Summary Compensation Table. Mr. Tobin’s total compensation was $16,795,101 resulting in an estimated ratio of 317:1 for CEO pay to median worker pay.
DOVER CORPORATION – 2024 Proxy Statement 62
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EXECUTIVE COMPENSATION TABLES
Grants of Plan-Based Awards in 2023
All awards listed in the table below have a grant date of February 10, 2023 for all executive officers. For a discussion of the awards, see “Compensation Discussion and Analysis – Elements of Executive Compensation.”
|
Name |
Type |
Estimated Future Payouts
|
Estimated Future Payouts
|
All Other
Share of
(#) |
All Other
Securities
|
Exercise
Price of
|
Grant
Stock
|
|||||||||||||||||||||||||||||||||||
|
Threshold
($)(1) |
Target
($) |
Maximum
($) |
Threshold
(#)(1) |
Target
(#) |
Maximum
(#) |
|||||||||||||||||||||||||||||||||||||
|
Richard J. Tobin |
AIP (2) |
|
975,000 |
|
|
1,950,000 |
|
|
3,900,000 |
|
||||||||||||||||||||||||||||||||
| SSAR (3) |
|
110,205 |
|
|
153.25 |
|
|
5,209,390 |
|
|||||||||||||||||||||||||||||||||
|
Performance
|
|
24,796 |
|
|
74,388 |
|
|
6,186,106 |
|
|||||||||||||||||||||||||||||||||
|
RSU (5) |
|
12,398 |
|
|
1,899,994 |
|
||||||||||||||||||||||||||||||||||||
|
Brad M. Cerepak |
AIP (2) |
|
395,250 |
|
|
790,500 |
|
|
1,581,000 |
|
||||||||||||||||||||||||||||||||
|
SSAR (3) |
|
24,651 |
|
|
153.25 |
|
|
1,165,253 |
|
|||||||||||||||||||||||||||||||||
|
Performance
|
|
5,546 |
|
|
16,638 |
|
|
1,383,616 |
|
|||||||||||||||||||||||||||||||||
|
RSU (5) |
|
2,773 |
|
|
424,962 |
|
||||||||||||||||||||||||||||||||||||
|
Girish Juneja |
AIP (2) |
|
187,425 |
|
|
374,850 |
|
|
749,700 |
|
||||||||||||||||||||||||||||||||
| SSAR (3) |
|
8,700 |
|
|
153.25 |
|
|
411,249 |
|
|||||||||||||||||||||||||||||||||
|
Performance
|
|
1,958 |
|
|
5,874 |
|
|
488,482 |
|
|||||||||||||||||||||||||||||||||
|
RSU (5) |
|
979 |
|
|
150,032 |
|
||||||||||||||||||||||||||||||||||||
|
Ivonne M. Cabrera |
AIP (2) |
|
235,950 |
|
|
471,900 |
|
|
943,800 |
|
||||||||||||||||||||||||||||||||
|
SSAR (3) |
|
11,601 |
|
|
153.25 |
|
|
548,379 |
|
|||||||||||||||||||||||||||||||||
|
Performance
|
|
2,610 |
|
|
7,830 |
|
|
651,143 |
|
|||||||||||||||||||||||||||||||||
|
RSU (5) |
|
1,305 |
|
|
199,991 |
|
||||||||||||||||||||||||||||||||||||
|
Kimberly K. Bors |
AIP (2) |
|
170,345 |
|
|
340,690 |
|
|
681,380 |
|
||||||||||||||||||||||||||||||||
| SSAR (3) |
|
7,540 |
|
|
153.25 |
|
|
356,416 |
|
|||||||||||||||||||||||||||||||||
|
Performance
|
|
1,697 |
|
|
5,091 |
|
|
423,368 |
|
|||||||||||||||||||||||||||||||||
|
RSU (5) |
|
848 |
|
|
129,956 |
|
||||||||||||||||||||||||||||||||||||
| (1) |
Represents the minimum amount payable for a certain level of performance. Under each of our plans, there is no guaranteed minimum payment. |
| (2) |
The amounts shown in this row reflect the potential payouts in February 2024 for 2023 under the AIP. The bonus amount actually paid in February 2024 is disclosed in the Summary Compensation Table in the column “Bonus” for 2023 for the executive officer. |
| (3) |
Represents an award of SSARs under the 2021 LTIP that will not be exercisable until February 10, 2026. The grant date fair value was calculated in accordance with FASB ASC 718, using a Black-Scholes value of $47.27 per SSAR. |
| (4) |
Represents an award of performance shares under the 2021 LTIP. The performance shares vest and become payable after the three-year performance period ending December 31, 2025 subject to the achievement of the applicable performance goal. The performance share awards are considered market condition awards per FASB ASC 718 and the grant date fair value for the awards was $249.48 per share, calculated using the Monte Carlo simulation model in accordance with FASB ASC 718. |
| (5) |
Represents an award of RSUs under the 2021 LTIP Plan. The grant vests in three equal annual installments beginning on March 15, 2024. The grant date fair value for the awards were calculated in accordance with FASB ASC 718, using a value of $153.25 per share. |
DOVER CORPORATION – 2024 Proxy Statement 63
Table of Contents
EXECUTIVE COMPENSATION TABLES
Outstanding Equity Awards at Fiscal Year-End 2023
Awards listed below with grant dates beginning in 2013 were made under the 2012 LTIP. All equity awards outstanding as of May 9, 2018 were adjusted as a result of the spin-off of Apergy Corporation (now known as ChampionX Corporation) to preserve the value of the awards in accordance with the Employee Matters Agreement, dated May 9, 2018, between Dover and Apergy.
Effective May 7, 2021, we adopted the 2021 LTIP. All grants of equity awards made on or after May 7, 2021 were made under the 2021 LTIP.
| Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||||
| Name |
Number of
Securities Underlying Unexercised Options (#) Exercisable |
Number of
Securities Underlying Unexercised Options (#) Unexercisable |
Option
Exercise Prices ($) |
Option
Expiration Date |
Number of
Shares or Units of Stock That Have Not Vested (#) |
Market Value
Stock That
Vested ($) |
Equity
Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have not Vested (#) |
Equity
Incentive Plan
Value of
Unearned
|
||||||||||||||||||||||||||||
|
Richard J. Tobin |
|
110,205 (1) |
|
|
153.25 |
|
|
2/10/2033 |
|
|||||||||||||||||||||||||||
|
|
99,869 (2) |
|
|
160.21 |
|
|
2/11/2032 |
|
||||||||||||||||||||||||||||
|
|
123,125 (3) |
|
|
122.73 |
|
|
2/12/2031 |
|
||||||||||||||||||||||||||||
|
|
118,657 (4) |
|
|
119.86 |
|
|
2/14/2030 |
|
||||||||||||||||||||||||||||
|
|
184,211 (5) |
|
|
91.20 |
|
|
2/15/2029 |
|
||||||||||||||||||||||||||||
|
|
210,658 (6) |
|
|
79.75 |
|
|
5/23/2028 |
|
||||||||||||||||||||||||||||
|
|
12,398 (12) |
|
|
1,906,936 (15) |
|
|
24,796 (16) |
|
|
3,813,873 (18) |
|
|||||||||||||||||||||||||
|
|
7,490 (13) |
|
|
1,152,037 (15) |
|
|
22,471 (17) |
|
|
3,456,265 (18) |
|
|||||||||||||||||||||||||
|
|
4,618 (14) |
|
|
710,295 (15) |
|
|||||||||||||||||||||||||||||||
|
Brad M. Cerepak |
|
24,651 (1) |
|
|
153.25 |
|
|
2/10/2033 |
|
|||||||||||||||||||||||||||
|
|
23,580 (2) |
|
|
160.21 |
|
|
2/11/2032 |
|
||||||||||||||||||||||||||||
|
|
30,781 (3) |
|
|
122.73 |
|
|
2/12/2031 |
|
||||||||||||||||||||||||||||
|
|
29,664 (4) |
|
|
119.86 |
|
|
2/14/2030 |
|
||||||||||||||||||||||||||||
|
|
52,632 (5) |
|
|
91.20 |
|
|
2/15/2029 |
|
||||||||||||||||||||||||||||
|
|
58,478 (7) |
|
|
82.09 |
|
|
2/9/2028 |
|
||||||||||||||||||||||||||||
|
|
71,806 (8) |
|
|
66.85 |
|
|
2/10/2027 |
|
||||||||||||||||||||||||||||
|
|
71,860 (10) |
|
|
61.79 |
|
|
2/12/2025 |
|
||||||||||||||||||||||||||||
|
|
2,773 (12) |
|
|
426,515 (15) |
|
|
5,546 (16) |
|
|
853,030 (18) |
|
|||||||||||||||||||||||||
|
|
1,769 (13) |
|
|
272,090 (15) |
|
|
5,306 (17) |
|
|
816,116 (18) |
|
|||||||||||||||||||||||||
|
|
1,155 (14) |
|
|
177,651 (15) |
|
|||||||||||||||||||||||||||||||
|
Girish Juneja |
|
8,700 (1) |
|
|
153.25 |
|
|
2/10/2033 |
|
|||||||||||||||||||||||||||
|
|
8,322 (2) |
|
|
160.21 |
|
|
2/11/2032 |
|
||||||||||||||||||||||||||||
|
|
7,243 (3) |
|
|
122.73 |
|
|
2/12/2031 |
|
||||||||||||||||||||||||||||
|
|
7,416 (4) |
|
|
119.86 |
|
|
2/14/2030 |
|
||||||||||||||||||||||||||||
|
|
11,842 (5) |
|
|
91.20 |
|
|
2/15/2029 |
|
||||||||||||||||||||||||||||
|
|
11,695 (7) |
|
|
82.09 |
|
|
2/9/2028 |
|
||||||||||||||||||||||||||||
|
|
979 (12) |
|
|
150,580 (15) |
|
|
1,958 (16) |
|
|
301,160 (18) |
|
|||||||||||||||||||||||||
|
|
624 (13) |
|
|
95,977 (15) |
|
|
1,873 (17) |
|
|
288,086 (18) |
|
|||||||||||||||||||||||||
|
|
272 (14) |
|
|
41,836 (15) |
|
|||||||||||||||||||||||||||||||
DOVER CORPORATION – 2024 Proxy Statement 64
Table of Contents
EXECUTIVE COMPENSATION TABLES
| Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||||
| Name |
Number of
Securities Underlying Unexercised Options (#) Exercisable |
Number of
Securities Underlying Unexercised Options (#) Unexercisable |
Option
Exercise Prices ($) |
Option
Expiration Date |
Number of
Shares or Units of Stock That Have Not Vested (#) |
Market Value
Stock That
Vested ($) |
Equity
Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have not Vested (#) |
Equity
Incentive Plan
Value of
Unearned
|
||||||||||||||||||||||||||||
|
Ivonne M. Cabrera |
|
11,601 (1) |
|
|
153.25 |
|
|
2/10/2033 |
|
|||||||||||||||||||||||||||
|
|
11,097 (2) |
|
|
160.21 |
|
|
2/11/2032 |
|
||||||||||||||||||||||||||||
|
|
11,588 (3) |
|
|
122.73 |
|
|
2/12/2031 |
|
||||||||||||||||||||||||||||
|
|
11,866 (4) |
|
|
119.86 |
|
|
2/14/2030 |
|
||||||||||||||||||||||||||||
|
|
21,053 (5) |
|
|
91.20 |
|
|
2/15/2029 |
|
||||||||||||||||||||||||||||
|
|
23,391 (7) |
|
|
82.09 |
|
|
2/9/2028 |
|
||||||||||||||||||||||||||||
|
|
28,722 (8) |
|
|
66.85 |
|
|
2/10/2027 |
|
||||||||||||||||||||||||||||
|
|
39,775 (9) |
|
|
48.28 |
|
|
2/11/2026 |
|
||||||||||||||||||||||||||||
|
|
31,074 (10) |
|
|
61.79 |
|
|
2/12/2025 |
|
||||||||||||||||||||||||||||
|
|
25,873 (11) |
|
|
69.57 |
|
|
3/10/2024 |
|
||||||||||||||||||||||||||||
|
|
1,305 (12) |
|
|
200,722 (15) |
|
|
2,610 (16) |
|
|
401,444 (18) |
|
|||||||||||||||||||||||||
|
|
832 (13) |
|
|
127,970 (15) |
|
|
2,497 (17) |
|
|
384,064 (18) |
|
|||||||||||||||||||||||||
|
|
435 (14) |
|
|
66,907 (15) |
|
|||||||||||||||||||||||||||||||
|
Kimberly K. Bors |
|
7,540 (1) |
|
|
153.25 |
|
|
2/10/2033 |
|
|||||||||||||||||||||||||||
|
|
5,881 (2) |
|
|
160.21 |
|
|
2/11/2032 |
|
||||||||||||||||||||||||||||
|
|
7,677 (3) |
|
|
122.73 |
|
|
2/12/2031 |
|
||||||||||||||||||||||||||||
|
|
7,416 (4) |
|
|
119.86 |
|
|
2/14/2030 |
|
||||||||||||||||||||||||||||
|
|
848 (12) |
|
|
130,431 (15) |
|
|
1,697 (16) |
|
|
261,016 (18) |
|
|||||||||||||||||||||||||
|
|
442 (13) |
|
|
67,984 (15) |
|
|
1,323 (17) |
|
|
203,491 (18) |
|
|||||||||||||||||||||||||
|
|
288 (14) |
|
|
44,297 (15) |
|
|||||||||||||||||||||||||||||||
| (1) |
SSARs granted on February 10, 2023 that are not exercisable until February 10, 2026. |
| (2) |
SSARs granted on February 11, 2022 that are not exercisable until February 11, 2025. |
| (3) |
SSARs granted on February 12, 2021 that became exercisable on February 12, 2024. |
| (4) |
SSARs granted on February 14, 2020 that became exercisable on February 14, 2023. |
| (5) |
SSARs granted on February 15, 2019 that became exercisable on February 15, 2022. |
| (6) |
SSARs granted on May 23, 2018 that became exercisable on May 23, 2021. |
| (7) |
SSARs granted on February 9, 2018 that became exercisable on February 9, 2021. |
| (8) |
SSARs granted on February 10, 2017 that became exercisable on February 10, 2020. |
| (9) |
SSARs granted on February 11, 2016 that became exercisable on February 11, 2019. |
| (10) |
SSARs granted on February 12, 2015 that became exercisable on February 12, 2018. |
| (11) |
SSARs granted on March 10, 2014 that became exercisable on March 10, 2017. |
| (12) |
Unvested RSUs granted on February 10, 2023. The units vest in three equal annual installments beginning on March 15, 2024 |
| (13) |
Unvested portion of RSUs granted on February 11, 2022. The units began vesting in three equal annual installments on March 15, 2023. |
| (14) |
Unvested portion of RSUs granted on February 12, 2021. The units began vesting in three equal annual installments on March 15, 2022. |
| (15) |
The amount reflects the number of units granted multiplied by $153.81, the closing price of our common stock on December 29, 2023. |
| (16) |
Performance shares granted on February 10, 2023 become payable after December 31, 2025 subject to the achievement of the applicable performance goal. The amount reflected in the table represents the number of shares payable based on achievement of the target level of performance (100%). |
| (17) |
Performance shares granted on February 11, 2022 become payable after December 31, 2024 subject to the achievement of the applicable performance goal. The amount reflected in the table represents the number of shares payable based on achievement of the target level of performance (100%). |
| (18) |
The amount reflects the number of performance shares payable based on achievement of the target level of performance multiplied by $153.81, the closing price of our common stock on December 29, 2023. |
DOVER CORPORATION – 2024 Proxy Statement 65
Table of Contents
EXECUTIVE COMPENSATION TABLES
Option Exercises and Stock Vested in 2023
| Name | Option Awards |
Stock Awards |
||||||||||||||||||
|
Number of Shares
Acquired on Exercise (#)(1) |
Value Realized
on Exercise ($)(2) |
Number of Shares
Acquired on Vesting (#)(3) |
Value Realized
on Vesting ($)(4) |
|||||||||||||||||
|
Richard J. Tobin |
34,032 | 5,059,322 | ||||||||||||||||||
|
Brad M. Cerepak |
91,981 | 9,550,847 | 8,456 | 1,257,543 | ||||||||||||||||
|
Girish Juneja |
2,111 | 312,909 | ||||||||||||||||||
|
Ivonne M. Cabrera |
28,841 | 2,552,866 | 3,293 | 488,780 | ||||||||||||||||
|
Kimberly K. Bors |
2,109 | 313,641 | ||||||||||||||||||
| (1) |
Represents exercise of SSARs; number of shares reported as acquired is the total number of shares underlying the SSAR, rather than the net number of shares received by the NEO. |
| (2) |
The “value realized on exercise” provided in the table represents the difference between the average of the high and low trading price on the exercise date and the exercise or base price, multiplied by the number of shares acquired upon exercise of the award. |
| (3) |
This column represents the vesting of a portion of the 2020, 2021 and 2022 grants of RSUs for Messrs. Tobin, Cerepak, and Juneja, and Mses. Cabrera and Bors as well as a performance share payout for the performance period ended December 31, 2023. The number of shares reported as acquired is the full number of RSUs vested or performance shares paid out, not the net number of shares received by the NEO after withholding shares for satisfaction of taxes. |
| (4) |
This value represents the average of the high and low trading price on the date of vesting multiplied by the number of RSUs vesting plus the number of performance shares paid for the period ended December 31, 2023 multiplied by $153.81, the closing price of our stock on December 29, 2023. |
Pension Benefits through 2023
| Name | Plan Name |
Number of
Years Credited Service (#) |
Normal
Retirement Age (#) |
Present Value
of Accumulated Benefit ($)(1) |
Payments
During Last Fiscal Year ($) |
|||||||||||||
|
Richard J. Tobin (2) |
Pension Plan |
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|||||
|
PRP |
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
||||||
|
Brad M. Cerepak |
Pension Plan |
|
15.0 |
|
|
65 |
|
|
684,124 |
|
|
N/A |
|
|||||
|
PRP |
|
14.6 |
|
|
65 |
|
|
2,943,927 |
|
|
N/A |
|
||||||
|
Girish Juneja (2) |
Pension Plan |
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|||||
|
PRP |
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
||||||
|
Ivonne M. Cabrera (3) |
Pension Plan |
|
20.6 |
|
|
65 |
|
|
623,350 |
|
|
N/A |
|
|||||
|
PRP |
|
19.9 |
|
|
65 |
|
|
1,393,097 |
|
|
N/A |
|
||||||
|
Kimberly K. Bors (2) |
Pension Plan |
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|||||
|
PRP |
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
||||||
| (1) |
This amount was earned by the NEOs over his or her years of service. For Mr. Cerepak and Ms. Cabrera, the present value of benefits was calculated assuming that the executive will receive a single lump sum payment upon retirement at age 65. |
| (2) |
Mr. Tobin, Mr. Juneja and Ms. Bors are not eligible to participate in the Dover pension plan or the PRP, since the pension plan and the PRP were closed to new employees on December 31, 2013. |
| (3) |
Ms. Cabrera is eligible to retire with the portion of her PRP benefit accrued through December 31, 2009 payable unreduced at age 62 with 10 years of service, and the portion of her PRP benefit accrued from January 1, 2010 through December 31, 2022 payable unreduced at age 65. The present value of her PRP benefits assuming age 62 retirement age is $1,634,791. |
DOVER CORPORATION – 2024 Proxy Statement 66
Table of Contents
EXECUTIVE COMPENSATION TABLES
The amounts shown in the Pension Benefits table above are actuarial present values of the benefits accumulated through December 31, 2023. An actuarial present value is calculated by estimating expected future payments starting at an assumed retirement age, weighting the estimated payments by the estimated probability of surviving to each post-retirement age, and discounting the weighted payments at an assumed discount rate to reflect the time value of money. The actuarial present value represents an estimate of the amount which, if invested today at the assumed discount rate, would be sufficient on an average basis to provide estimated future payments totaling the current accumulated benefit. For purposes of the table, the assumed retirement age for each NEO is 65, the normal retirement age under each plan. Actual benefit present values will vary from these estimates depending on many factors, including an executive’s actual retirement age.
Pension Plan
We have a pension plan for which eligible Dover employees, and the salaried employees of our participating subsidiaries, were eligible to become participants after they completed one year of service. Benefits under the pension plan for Dover employees, including those for the applicable NEOs, are determined by multiplying a participant’s years of credited service (up to a maximum of 35 years) by a percentage of their final average compensation, subject to statutory limits applicable to tax-qualified pension plans. Benefits for a number of the participating subsidiaries are determined under different benefit formulae.
Pension plan participants generally vest in their benefits after five years of employment or, if earlier, upon reaching age 65, which is the normal retirement age under the plan. All NEOs who participate in the pension plan are vested in their pension plan benefits and are eligible to begin receiving reduced benefits if their employment terminates before normal retirement age.
Effective December 31, 2013, the pension plan is closed to new employees. All pension eligible employees as of December 31, 2013 continued to earn pension benefits through December 31, 2023 as long as they remained employed by an operating company participating in the plan. Dover eliminated benefit accruals effective December 31, 2023.
Pension Replacement Plan
We also maintain the PRP, which is a non-qualified plan for tax purposes, to provide benefits to certain employees whose compensation and pension plan benefits are greater than the compensation and benefit limits applicable to tax-qualified pension plans. Prior to January 1, 2010, our plan which provided non-qualified retirement benefits was the Supplemental Executive Retirement Plan (“SERP”). Effective January 1, 2010, the SERP was amended to provide reduced benefits that are more consistent with the benefits provided under the pension plan and its name was changed to the PRP.
Employees are eligible to participate in the PRP if they hold certain positions within Dover, or its subsidiaries, are U.S. taxpayers and earn more than a set percentage above the Internal Revenue Code’s compensation limits for tax-qualified pension plans. Dover’s CEO may designate other employees as eligible and may revoke the eligibility of participants.
The formula for determining benefits accrued under the PRP after December 31, 2009, before offsets, is determined using the same benefit formula as under the pension plan, except that the Internal Revenue Code’s limits on compensation and benefits applicable to tax-qualified pension plans will not apply. Benefits under the former SERP, before offsets, were determined by multiplying the participant’s years of actual service with Dover companies, plus, in limited cases, prior service credit by a percentage of the participant’s final average compensation as defined under the plan.
Benefits payable under the PRP or SERP are reduced by the amount of Company-provided benefits under any other retirement plans, including the pension plan, as well as the Company-paid portion of social security benefits. PRP participants must complete five years of service to vest in their benefits. All NEOs who participate in the PRP are fully vested in their benefits and will commence receiving benefits upon termination of employment. PRP benefits may be forfeited for “cause” (defined as conviction of a felony which places a Dover company at legal or other risk or is expected to cause substantial harm to the business of a Dover company or its relationships with employees, distributors, customers or suppliers).
Normal retirement age for purposes of the PRP is age 65. Certain employees who were participants on or before March 1, 2010 will be entitled to receive the portion of their benefits that accrued through December 31, 2009 without any reduction due to early retirement if they retire after they reach age 62 and complete 10 years of service. Generally, benefits accrued after December 31, 2009 will be subject to early retirement reduction factors consistent with the reduction factors in the pension plan.
DOVER CORPORATION – 2024 Proxy Statement 67
Table of Contents
EXECUTIVE COMPENSATION TABLES
Effective December 31, 2013, the PRP is closed to new employees. All eligible employees as of December 31, 2013 continued to earn to their PRP benefits through December 31, 2023 as long as they remained employed by Dover and its affiliates. Dover eliminated benefit accruals effective December 31, 2023, consistent with the freezing of benefit accruals under the pension plan.
Nonqualified Deferred Compensation
| Name | Plan Name |
Executive contributions in last FY ($)(1) |
Registrant contributions in last FY ($) |
Aggregate
earnings
($) |
Aggregate
Distribution ($) |
Aggregate
balance
($) |
||||||||||||||||
|
Richard J. Tobin |
Deferred
|
|
1,867,077 |
|
|
176,357 |
|
|
623,617 |
|
|
0 |
|
|
8,995,315 |
|
||||||
|
Brad M. Cerepak |
Deferred
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
||||||
|
Girish Juneja |
Deferred
|
|
616,292 |
|
|
34,297 |
|
|
235,858 |
|
|
0 |
|
|
3,875,744 |
|
||||||
|
Ivonne M. Cabrera |
Deferred
|
|
N/A |
|
|
N/A |
|
|
35,772 |
|
|
N/A |
|
|
202,665 |
|
||||||
|
Kimberly K. Bors |
Deferred
|
|
0 |
|
|
29,640 |
|
|
12,872 |
|
|
0 |
|
|
155,656 |
|
||||||
| (1) |
If any amounts were shown as executive contributions in 2023, they would be included in the Summary Compensation Table in the salary or bonus columns, as appropriate, for the respective officers. |
Our deferred compensation plan is a nonqualified plan that permits select key management and highly compensated employees on a U.S. payroll with an annual salary equal to or greater than $250,000 for 2023 deferrals to irrevocably elect to defer a portion of their salary and bonus. The deferred compensation plan provides participants who are not eligible to participate in the PRP with the same level of matching and other employer contributions that they would have received if certain compensation limits under our Retirement Savings plan did not apply. Only Mr. Cerepak and Ms. Cabrera participate in the PRP and are therefore not eligible to receive matching and other employer contributions under the deferred compensation plan. The plan, as amended effective January 1, 2022, operates similar to an “excess” deferred compensation plan in that it provides for employer contributions on salary and bonuses in excess of the compensation limit permitted under the tax-qualified retirement savings plan.
Under the amended deferred compensation plan, an eligible participant’s account will be credited each year with automatic employer contributions equal to 4.5% of the amount by which the eligible participant’s salary and bonus exceed the limitation imposed under Internal Revenue Code Section 401(a)(17) for such year.
Amounts deferred under the plan are credited with hypothetical investment earnings based on the participant’s investment elections made from investment options designated under the plan. Participants are 100% vested in all amounts they defer, as adjusted for any earnings and losses on such deferred amounts. Effective as of January 1, 2010, a hypothetical investment option that tracks the value of Dover common stock, including any dividend payments, was added to the plan. This Dover stock unit fund does not actually hold any Dover stock, and participants who elect to participate in this option do not own any Dover common stock, or have any voting or other rights associated with the ownership of our common stock. Participants’ accounts are credited with the net returns of shares of our common stock equal to the number of stock units held by the participant. All distributions from the stock unit fund will be paid in cash. Balances allocated into the stock unit fund must remain in the stock unit fund for the remainder of the participant’s participation in the plan.
Generally, deferred amounts will be distributed from the plan only on account of retirement at age 65 (or age 55 with 10 years of service), disability or other termination of service, or at a scheduled in-service withdrawal date chosen by the participant.
DOVER CORPORATION – 2024 Proxy Statement 68
Table of Contents
EXECUTIVE COMPENSATION TABLES
Potential Payments upon Termination or Change in Control
The discussion and table below describe the incremental payments or values to which each of the NEOs would be entitled in the event of termination of such executive’s employment or a change in control. The only compensation plans under which an executive may be entitled to incremental payments are the severance plan, the CIC Severance Plan and the 2012 and 2021 LTIP. Mr. Tobin’s employment agreement provides for benefits similar to the severance plan, except as noted in the table below. No incremental values would be payable under the PRP, pension plan or deferred compensation plan as a result of a termination event or change in control.
Voluntary termination. If an NEO voluntarily terminates his or her employment, he or she will not be entitled to any incremental payments and unvested equity awards will be forfeited, unless the executive is eligible for normal or early retirement under the 2012 and 2021 LTIP as discussed below.
Involuntary termination without cause. If Dover terminates the employment of an NEO without cause (excluding termination due to death or disability), the NEO will be entitled to a cash severance payment under the severance plan consisting of:
| • |
An amount equal to base salary plus target annual cash bonus for 12 months following the date of termination; |
| • |
A pro rata portion (based on the completed calendar months worked in the year of termination) of the NEO’s target annual incentive bonus payable for the year of termination, subject to potential reduction in the discretion of the Compensation Committee based upon attainment of the applicable performance criteria; |
| • |
A pro rata performance share award granted under the 2012 or 2021 LTIP having a scheduled payment date next following the date of termination (based on the completed calendar months worked in the year of termination) based upon attainment of the performance criteria applicable to the award as determined by the Compensation Committee; |
| • |
Outplacement services, at the company’s discretion, for 12 months up to a maximum cost of $25,000; and |
| • |
A lump sum payment equal to the then cost of COBRA health continuation coverage, based on the level of health care coverage in effect on the termination date, for 12 months. |
Unvested equity awards will be forfeited.
Retirement (for awards made in 2020 and earlier). Under the 2012 LTIP, an NEO eligible for normal or early retirement will be entitled to continued vesting of SSARs and restricted stock unit awards for 24 months in the case of early retirement under the Rule of 65, 36 months in the case of early retirement under the Rule of 70 and 60 months in the case of normal retirement at or after age 65. In the case of normal retirement, the outstanding performance share awards for the performance period ending the soonest will continue to vest, subject to the satisfaction of the applicable performance targets. In the case of early retirement under the Rule of 65 or 70, outstanding performance share awards are payable, subject to the satisfaction of the applicable performance targets, only at the Compensation Committee’s discretion.
Early retirement under the 2012 LTIP is defined as termination for any reason other than normal retirement, death, disability or cause, under one of the following circumstances applicable to the NEOs:
| • |
The executive has at least 10 years of service with a Dover company, the sum of his or her age and years of service on the date of termination equals at least 65, and for awards granted on or after August 6, 2014, is at least 55 years old (the “Rule of 65”), and the executive complies with certain notice requirements; or |
| • |
The executive has at least 15 years of service with a Dover company, the sum of his or her age and years of service on the date of termination equals at least 70, and for awards granted on or after August 6, 2014, is at least 60 years old (the “Rule of 70”), and the executive complies with certain notice requirements. |
Any person who takes early or normal retirement under the 2012 LTIP is deemed to have expressly agreed that he or she will not compete with us or any of our companies at which he or she was employed within the three years immediately prior to his or her termination, in the geographic areas in which we or that company actively carried on business at the end of the participant’s employment, for the period during which such retirement affords him or her enhanced benefits (24 months in the case of the Rule of 65, 36 months in the case of the Rule of 70 or 60 months in the case of normal retirement). If the participant fails to comply with the non-compete provision, he or she forfeits any enhanced benefits under the 2012 LTIP and must return to Dover the economic value previously realized by reason of such benefits.
DOVER CORPORATION – 2024 Proxy Statement 69
Table of Contents
EXECUTIVE COMPENSATION TABLES
Retirement (for awards made in 2021 onwards). Under the 2012 and 2021 LTIP, an NEO eligible for normal or early retirement will be entitled to continued vesting of SSARs and restricted stock unit awards for 36 months in the case of early retirement and 60 months in the case of normal retirement at or after age 62. In the case of normal retirement, the outstanding performance share awards for the performance period ending the soonest will continue to vest, subject to the satisfaction of the applicable performance targets. In the case of early retirement, outstanding performance share awards are payable, subject to the satisfaction of the applicable performance targets, only at the Compensation Committee’s discretion.
Early retirement under the 2012 and 2021 LTIP is defined as any reason other than normal retirement, death, disability or cause, under the following circumstance: The executive has at least 10 years of service with a Dover company, is at least 55 years old, and complies with certain notice requirements.
Any person who takes early or normal retirement under the 2012 or 2021 LTIP is deemed to have expressly agreed that he or she will not compete with us or any of our companies at which he or she was employed within the three years immediately prior to his or her termination, in the geographic areas in which we or that company actively carried on business at the end of the participant’s employment, for the period during which such retirement affords him or her enhanced benefits (36 months in the case of early retirement or 60 months in the case of normal retirement). If the participant fails to comply with the non-compete provision, he or she forfeits any enhanced benefits under the 2012 and 2021 LTIP and must return to Dover the economic value previously realized by reason of such benefits.
Change in Control (without termination of employment). All the change in control provisions in Dover’s compensation plans are double-trigger. Accordingly, an NEO’s compensation generally will not be affected by a change in control without termination of his or her employment. An executive will be entitled to incremental payments or values upon a change in control without termination of employment only if an executive’s outstanding awards under the 2012 or 2021 LTIP are impaired. In that circumstance, all unvested SSARs and restricted stock units will immediately vest on the date of the change in control and
outstanding performance share awards will immediately vest and become payable on the date of the change in control on a pro-rata basis for a shortened performance period.
Each person granted an award under the 2012 or 2021 LTIP is deemed to agree that, upon a tender or exchange offer, proxy solicitation or other action seeking to effect a change in control of Dover, he or she will not voluntarily terminate employment with us or any of our companies and, unless terminated by us, will continue to render services to us until the person seeking to effect a change in control of our Company has abandoned, terminated or succeeded in such person’s efforts to effect the change in control.
Under the PRP, upon a change in control, each participant will become entitled to receive the actuarial value of the participant’s benefit accrued through the date of the change in control. No additional incremental amounts are payable under the PRP upon a change in control.
Termination following a change in control. Upon the double-trigger events of a termination of employment following a change in control, an NEO may be eligible for certain cash severance payments and accelerated vesting of equity awards as described below.
An NEO will be entitled to receive severance payments if, within 24 months after the change in control, either his or her employment is terminated by Dover without “cause” or the executive terminates employment for “good reason,” under and as such terms are defined in the CIC Severance Plan. The severance payments will consist of the following:
| • |
A lump sum payment equal to 2.0 multiplied by the sum of (i) the executive’s annual salary on the termination date or the change in control date, whichever is higher, and (ii) his or her target annual incentive bonus for the year in which the termination or the date of the change in control occurs, whichever is higher; |
| • |
A lump sum payment equal to the pro rata portion (based on the completed days worked in the year in which the date of termination occurs divided by the number of days in such year) of the NEO’s target annual incentive bonus; |
| • |
12 months of outplacement services up to a maximum of $25,000, as adjusted upwards for inflation; and |
| • |
A lump sum payment equal to the then cost of COBRA health continuation coverage, based on the level of health care coverage in effect on the termination date, if any, for 24 months. |
DOVER CORPORATION – 2024 Proxy Statement 70
Table of Contents
EXECUTIVE COMPENSATION TABLES
No executive may receive severance benefits under more than one plan or arrangement. If Dover determines that (i) any payment or distribution to an executive in connection with change in control, whether under the CIC Severance Plan or otherwise, would be subject to excise tax as an excess parachute payment under the Internal Revenue Code and (ii) the executive would receive a greater net-after-tax amount by reducing the amount of the severance payment, Dover will reduce the severance payments made under the CIC Severance Plan to the maximum amount that might be paid (but not less than zero) without the executive becoming subject to the excise tax. The CIC Severance Plan does not provide any gross-up for excise taxes.
In addition, if, within 24 months following a change in control of Dover (as defined in the 2012 or 2021 LTIP) the executive is either involuntarily terminated other than for cause, death or disability or an event or condition that constitutes “good reason” occurs, and the executive subsequently resigns for good reason within applicable time limits and other requirements under the 2012 or 2021 LTIP:
| • |
All unvested SSARs and RSUs immediately vest upon the date of termination and become exercisable in accordance with the terms of the applicable award agreement; and |
| • |
All performance share awards will be deemed to have been earned “at target” as if the performance target had been achieved and such awards will immediately vest and become immediately due and payable on the date of termination |
Potential Payments upon Termination or Change in Control Table. The table below shows the incremental amounts payable to each NEO if his or her employment had terminated in certain circumstances on December 31, 2023. The amounts shown assume that termination was effective as of December 31, 2023. The actual amounts to be paid out can only be determined at the time of each executive’s separation from Dover.
| Name |
Voluntary
Termination ($)(1) |
Involuntary Not for
Cause Termination ($)(2) |
For Cause
Termination ($)(3) |
Normal
Retirement or Early Retirement ($) |
Involuntary or
Good Reason Termination following a Change-in-Control ($) |
|||||||||||||||
|
Richard J. Tobin |
||||||||||||||||||||
| Cash severance | N/A | 4,875,000 (5) | N/A | N/A | 6,500,000 (6) | |||||||||||||||
| Performance share award | 0 | 0 | 0 | N/A | 7,270,137 (8) | |||||||||||||||
| Stock options/SSARs | 0 | 0 | 0 | N/A | 3,888,440 (9) | |||||||||||||||
| Restricted Stock Units | 0 | 0 | 0 | N/A | 3,769,268 (11) | |||||||||||||||
| Health and welfare benefits | 0 | 41,232 (12) | 0 | N/A | 54,976 (12) | |||||||||||||||
| Outplacement | N/A | 25,000 | N/A | N/A | 25,000 | |||||||||||||||
|
Total: |
0 | 4,941,232 | 0 | N/A | 21,507,821 | |||||||||||||||
|
Brad M. Cerepak |
||||||||||||||||||||
| Cash severance | N/A | 1,581,000 (5) | N/A | N/A | 3,162,000 (6) | |||||||||||||||
| Performance share award | N/A | 816,116 (7) | 0 | 816,116 (7) | 1,669,146 (8) | |||||||||||||||
| Stock options/SSARs | N/A | 970,478 (4) | 0 | 970,478 (4) | 970,478 (9) | |||||||||||||||
| Restricted Stock Units | N/A | 876,256 (10) | 0 | 876,256 (10) | 876,256 (11) | |||||||||||||||
| Health and welfare benefits | N/A | 27,488 (12) | 0 | 0 | 54,976 (12) | |||||||||||||||
| Outplacement | N/A | 25,000 | N/A | N/A | 25,000 | |||||||||||||||
|
Total: |
N/A | 4,296,338 | 0 | 2,662,849 | 6,757,856 | |||||||||||||||
DOVER CORPORATION – 2024 Proxy Statement 71
Table of Contents
EXECUTIVE COMPENSATION TABLES
| Name |
Voluntary
Termination ($)(1) |
Involuntary Not for
Cause Termination ($)(2) |
For Cause
Termination ($)(3) |
Normal
Retirement or Early Retirement ($) |
Involuntary or
Good Reason Termination following a Change-in-Control ($) |
|||||||||||||||
|
Girish Juneja |
||||||||||||||||||||
| Cash severance | N/A | 910,350 (5) | N/A | N/A | 1,820,700 (6) | |||||||||||||||
| Performance share award | 0 | 0 | 0 | N/A | 589,246 (8) | |||||||||||||||
| Stock options/SSARs | 0 | 0 | 0 | N/A | 229,984 (9) | |||||||||||||||
| Restricted Stock Units | 0 | 0 | 0 | N/A | 288,394 (11) | |||||||||||||||
| Health and welfare benefits | 0 | 19,473 (12) | 0 | N/A | 38,946 (12) | |||||||||||||||
| Outplacement | N/A | 25,000 | N/A | N/A | 25,000 | |||||||||||||||
|
Total: |
0 | 954,823 | 0 | N/A | 2,992,270 | |||||||||||||||
|
Ivonne M. Cabrera |
||||||||||||||||||||
| Cash severance | N/A | 1,101,100 (5) | N/A | N/A | 2,202,200 (6) | |||||||||||||||
| Performance share award | N/A | 384,064 (7) | 0 | 384,064 (7) | 785,508 (8) | |||||||||||||||
| Stock options/SSARs | N/A | 366,652 (4) | 0 | 366,652 (4) | 366,652 (9) | |||||||||||||||
| Restricted Stock Units | N/A | 395,599 (10) | 0 | 395,599 (10) | 395,599 (11) | |||||||||||||||
| Health and welfare benefits | 0 | 27,488 (12) | 0 | 0 | 54,976 (12) | |||||||||||||||
| Outplacement | N/A | 25,000 | N/A | N/A | 25,000 | |||||||||||||||
|
Total: |
2,299,903 | 0 | 1,146,314 | 3,829,935 | ||||||||||||||||
|
Kimberly K. Bors |
||||||||||||||||||||
| Cash severance | N/A | 827,390 (5) | N/A | N/A | 1,654,781 (6) | |||||||||||||||
| Performance share award | N/A | 203,491 (7) | 0 | 203,491 (7) | 464,506 (8) | |||||||||||||||
| Stock options/SSARs | N/A | 242,824 (4) | 0 | 242,824 (4) | 242,824 (9) | |||||||||||||||
| Restricted Stock Units | N/A | 242,712 (10) | 0 | 242,712 (10) | 242,712 (11) | |||||||||||||||
| Health and welfare benefits | N/A | 15,107 (12) | 0 | 0 | 30,213 (12) | |||||||||||||||
| Outplacement | N/A | 25,000 | N/A | N/A | 25,000 | |||||||||||||||
|
Total |
N/A | 1,556,523 | 0 | 689,026 | 2,660,036 | |||||||||||||||
| (1) |
Mr. Cerepak is eligible for early retirement for grants awarded through 2020 and normal retirement for grants awarded 2021 onwards. Ms. Bors is eligible for normal retirement for grants awarded 2021 onwards, and Ms. Cabrera is eligible for early retirement for grants under the 2012 and 2021 LTIP. Accordingly, we have assumed that Mr. Cerepak would take early retirement for his grants awarded through 2020 and normal retirement for his grants awarded 2021 onwards, Ms. Bors would take normal retirement for her grants awarded 2021 onwards, and Ms. Cabrera would take early retirement, rather than voluntary termination. |
| (2) |
Dover anticipates allowing anyone eligible for normal retirement or early retirement under the 2012 and 2021 LTIP to take normal or early retirement in the event of involuntary termination. Accordingly, for Mr. Cerepak, this column reflects the applicable early retirement treatment of his performance shares, RSUs, and SSARs, for grants awarded through 2020 and normal retirement treatment for grants awarded 2021 onwards, for Ms. Bors, this column reflects the applicable normal retirement treatment of her performance shares, RSUs, and SSARs for grants awarded 2021 onwards, and for Ms. Cabrera, this column reflects the applicable early retirement treatment of her performance shares, |
DOVER CORPORATION – 2024 Proxy Statement 72
Table of Contents
EXECUTIVE COMPENSATION TABLES
| RSUs, and SSARs that would vest within 24 months for grants awarded through 2020 and early retirement treatment of her performance shares, RSUs and SSARs that would vest within 36 months for grants awarded 2021 onwards. |
| (3) |
A NEO whose employment is terminated by us for cause will forfeit all outstanding cash and equity awards, whether or not vested or exercisable. The executive will also forfeit benefits under the PRP in accordance with the PRP terms. |
| (4) |
Reflects for Mr. Cerepak the value of unvested SSARs that would vest within 60 months for SSARs granted in 2021, 2022 and 2023; for Ms. Bors, the value of unvested SSARS that would vest within 60 months for SSARS granted in 2021, 2022 and 2023, for Ms. Cabrera, the value of unvested SSARs that would vest within 36 months for SSARs granted in 2021, 2022 and 2023. |
| (5) |
For Mr. Tobin, the amount is equal to 1.5 times the sum of his annual salary plus target bonus per his employment agreement; for the other NEOs, the amounts represent 12-month salary continuation and an annual incentive bonus at target. |
| (6) |
Represents a payment equal to 2 times the sum of (i) the executive’s annual salary on the termination date or the change in control date, whichever is higher, and (ii) his or her target annual incentive bonus for the year in which the termination or the date of the change in control occurs, whichever is higher. |
| (7) |
Represents payout at target of performance share awards granted under the 2021 LTIP for the 2022-2024 performance period, using $153.81 per share, market closing price on December 29, 2023. This calculation assumes that the Compensation Committee approves payout for the performance period for Mr. Cerepak, Ms. Cabrera and Ms. Bors. |
| (8) |
Represents payout at target of performance share awards granted under the 2021 LTIP for the 2022-2024 performance period and under the 2021 LTIP for the 2023-2025 performance period, using $153.81 per share, market closing price on December 29, 2023. |
| (9) |
Represents acceleration of vesting of unvested SSAR awards granted under the 2012 and 2021 LTIP, calculated as the difference between the closing price of $153.81 per share of our common stock on December 29, 2023, and the exercise price of each unvested SSAR award multiplied by the number of shares covered by such award. |
| (10) |
For Mr. Cerepak the amount reflects the value of unvested RSUs as of December 31, 2023 that will vest within 60 months for RSUs granted in 2021, 2022 and 2023. For Ms. Bors the amount reflects the value of unvested RSUs as of December 31, 2023 that will vest within the following 60 months for RSUs granted in 2021, 2022 and 2023. For Ms. Cabrera the amount reflects the value of unvested RSUs as of December 31, 2023 that will vest within the following 36 months for RSUs granted in 2021, 2022 and 2023. |
| (11) |
Represents acceleration of vesting of unvested RSUs granted under the 2012 and 2021 LTIP. |
| (12) |
Represents COBRA health continuation coverage costs under the severance plan or CIC Severance Plan as applicable. Under the Severance Plan, an executive is entitled to a lump sum payment equal to the then cost of COBRA health continuation coverage for 12 months. Mr. Tobin would receive 18 months COBRA per his employment agreement; under the CIC Severance Plan, the COBRA lump sum payments for Mr. Tobin and all the NEOs would receive 24 months. |
DOVER CORPORATION – 2024 Proxy Statement 73
Table of Contents
|
Year
|
Summary
Compensation
Table Total
for PEO
($)
|
Compensation
Actually Paid
to PEO ($)(1) |
Average
Summary
Compensation
Table Total for
Non-PEO
NEOs
($) |
Average
Compensation
Actually Paid
to
Non-PEO
NEOs
($)(1)
|
Value of $100 Investment
based on: |
Net Income
($)
|
Earnings ($)(2) |
|||||||||||||||||||||||||
|
Total
Shareholder
Return
($)
|
Peer Group
Total
Shareholder
Return
($)
|
|||||||||||||||||||||||||||||||
|
2023
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
2022
|
|
(
|
) |
|
(
|
|
|
|
|
|||||||||||||||||||||||
|
2021
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
2020
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
(1)
|
The table below provides the adjustments required by Item 402(v) to be made to the Summary Compensation Table totals to determine “compensation actually paid” as reported in the Pay versus Performance Table. “Compensation actually paid” does not necessarily represent cash and/or equity value transferred to the applicable NEO without restriction, but rather is a value calculated under applicable SEC rules.
|
|
Subtract
amounts reported in the “Stock Awards” and “Option Awards” columns in the SCT for applicable FY |
YE Value of
Current Year Awards Outstanding as of YE |
Change in
Value as of YE for Prior Year Awards Outstanding as of YE |
Change in
Value as of Vesting Date for Prior Year Awards That Vested During the Year |
Subtract
Change in Actuarial Value of Pension Benefits During Year |
Increase
for Service Cost
and, if
applicable,
Prior Service Cost for
pension
plans |
Total
Adjustments |
||||||||||||||||||||||
|
CEO
|
|
|||||||||||||||||||||||||||
|
2023
|
$(
|
$
|
$
|
$
|
$
|
$
|
($
|
|||||||||||||||||||||
|
2022
|
$(
|
$
|
($
|
($
|
$
|
$
|
($
|
|||||||||||||||||||||
|
2021
|
$(
|
$
|
$
|
$
|
$
|
$
|
$
|
|||||||||||||||||||||
|
2020
|
$(
|
$
|
$
|
($
|
$
|
$
|
($
|
|||||||||||||||||||||
|
|
||||||||||||||||||||||||||||
|
Avg. Other NEOs
|
|
|||||||||||||||||||||||||||
|
2023
|
$(
|
$
|
$
|
$
|
($
|
$
|
($
|
|||||||||||||||||||||
|
2022
|
$(
|
$
|
($
|
($
|
$
|
$
|
($
|
|||||||||||||||||||||
|
2021
|
$(
|
$
|
$
|
$
|
($
|
$
|
$
|
|||||||||||||||||||||
|
2020
|
$(
|
$
|
$
|
($
|
($
|
$
|
$
|
|||||||||||||||||||||
|
(2)
|
non-GAAP
measures are included at the end of this proxy statement.
|
|
|
Table of Contents
Proposal 3 — Advisory Resolution to Approve Named Executive Officer Compensation
Each year, we offer our shareholders an opportunity to vote to approve, on an advisory and nonbinding basis, the compensation of our NEOs as disclosed in this Proxy Statement in accordance with Section 14A of the Exchange Act.
We are asking our shareholders to indicate their support for our NEO compensation as described in this Proxy Statement. This proposal, commonly known as a “Say on Pay” proposal, gives our shareholders the opportunity to express their views on our NEOs’ compensation. We believe that our compensation programs are well designed and reinforce our strategic focus on continued revenue and profit growth.
Our Board has a strong history of engaging with shareholders and soliciting feedback on a range of topics, including our executive compensation program. Historically, our program has received strong shareholder support as expressed during our one-on-one engagement discussions with shareholders and through our Say on Pay vote levels. At our 2023 annual meeting, approximately 93% of the voting shareholders approved the compensation of the NEOs. At our 2022 annual meeting, approximately 94% of the voting shareholders approved the compensation of the NEOs. The Compensation Committee will continue to consider feedback from shareholders, as well as the results from future shareholder advisory votes, in its ongoing evaluation of executive compensation programs and practices at Dover.
This vote is not intended to address any specific item of compensation but rather the overall compensation of our NEOs and the philosophy, policies and practices described in this Proxy Statement. Accordingly, we ask our shareholders to vote “FOR” the following resolution at the Annual Meeting:
“RESOLVED, that Dover’s shareholders approve, on an advisory basis, the compensation of the named executive officers, as disclosed in Dover’s Proxy Statement for the 2024 Annual Meeting of Shareholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the Summary Compensation Table and the other related tables and disclosures.”
The Say on Pay vote is advisory and therefore not binding on Dover, our Compensation Committee or our Board. Our Board and our Compensation Committee value the opinions of our shareholders and, to the extent there is any significant vote against the NEO compensation as disclosed in this Proxy Statement, we will consider our shareholders’ concerns and the Compensation Committee will evaluate whether any actions are necessary to address those concerns.
THE BOARD RECOMMENDS A VOTE “FOR” THE APPROVAL OF THE COMPENSATION OF
OUR NEOs, AS DISCLOSED IN THIS PROXY STATEMENT.
DOVER CORPORATION – 2024 Proxy Statement 77
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Proposal 4 — Approval of An Amendment to our Fifth Restated Certificate of Incorporation to Reflect Recent Delaware Law Provisions Regarding Officer Exculpation
Our Board has unanimously approved and declared advisable, and recommends that our stockholders adopt, a proposed amendment to our Fifth Restated Certificate of Incorporation (the “Certificate”) to reflect recent Delaware law provisions regarding officer exculpation.
Article SEVENTEENTH of our Certificate presently provides for the elimination of personal liability of directors for monetary damages in certain circumstances pursuant to, and in accordance with, Section 102(b)(7) of the Delaware General Corporation Law (the “DGCL”).
Prior to 2022, the DGCL did not allow for similar elimination or limitation of personal liability of officers for monetary damages. Effective August 1, 2022, Section 102(b)(7) of the DGCL was amended to permit corporations to eliminate or limit the liability of certain senior corporate officers, in addition to directors, in certain limited circumstances. The new Delaware law only permits, and, if the proposed amendment to the Certificate is adopted, our Certificate would only permit, exculpation from liability for these officers in the case of direct claims brought by stockholders for breach of an officer’s fiduciary duty of care, including class actions, and would not eliminate officers’ monetary liability for breach of fiduciary duty claims brought by Dover itself or for derivative claims brought by stockholders on behalf of Dover. Furthermore, the limitation on liability would not apply to breaches of the duty of loyalty, acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, or any transaction in which the officer derived an improper personal benefit. As further described below, we believe this strikes a balance between stockholders’ interest in accountability and Dover’s interest in attracting and retaining high quality officers.
The description of the proposed amendment and the applicable provisions of the DGCL contained herein are summaries and are qualified in their entirety by the text of the proposed amendment and the full text of the applicable provisions of the DGCL.
Text of Proposed Amendment
Our Certificate presently provides for the exculpation of directors, but not officers. We propose to amend Article SEVENTEENTH of our Certificate so that it would state in its entirety as follows (with new text underlined):
“SEVENTEENTH: To the fullest extent permitted by the General Corporation Law of the State of Delaware as the same exists or may hereafter be amended, a director or officer (as defined below) of the corporation shall not be liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director or officer .
Any repeal or modification of this Article shall not result in any liability for a director or officer with respect to any action or omission occurring prior to such repeal or modification.
All references in this ARTICLE SEVENTEENTH to an “officer” shall mean only a person who, at the time of an act or omission as to which liability is asserted, falls within the meaning of the term “officer” as defined in Section 102(b)(7) of the General Corporation Law of the State of Delaware. ”
Factors to Consider
We believe that it is appropriate for directors and officers to remain free of the risk of financial ruin as a result of an unintentional misstep. The nature of the role of directors and officers often requires them to make decisions on crucial matters. Frequently, directors and officers must make decisions in response to time-sensitive opportunities and challenges, which can create substantial risk of investigations, claims, actions, suits or proceedings seeking to impose liability on the basis of hindsight, especially in the current litigious environment and regardless of merit.
Limiting the personal risk to our officers in addition to the existing limitation for directors would empower our officers to best exercise their business judgment in furtherance of stockholder interests. We believe that our directors and officers will best serve Dover if they feel protected in carrying out their duties and exercising judgment without fearing litigation for unintended mistakes, or being second guessed.
DOVER CORPORATION – 2024 Proxy Statement 78
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PROPOSAL 4 — APPROVAL OF AN AMENDMENT TO OUR FIFTH RESTATED CERTIFICATE OF INCORPORATION TO REFLECT RECENT DELAWARE LAW PROVISIONS REGARDING OFFICER EXCULPATION
We believe our peers will adopt similar officer exculpation clauses in their certificates of incorporation limiting the personal liability of officers, and failing to adopt the proposed amendment could impact our ability to recruit and retain exceptional officers. In the absence of such protection, qualified officers might be deterred from serving due to exposure to personal liability and the risk that substantial expense will be incurred in defending lawsuits, regardless of merit. In particular, in its consideration of the proposed amendment, the board took into account the narrow class and type of claims for which such officers would be exculpated from liability pursuant to amended DGCL Section 102(b)(7), the limited number of Dover officers that would be impacted and the benefits the board believes would accrue to Dover by providing exculpation in accordance with DGCL Section 102(b)(7), including, without limitation, the ability to attract and retain key officers and the potential to reduce litigation costs associated with frivolous lawsuits.
The board balanced these considerations with Dover’s existing corporate governance practices and unanimously determined that it is advisable and in the best interests of Dover and its stockholders to amend Article SEVENTEENTH of our Certificate to extend exculpation protection to our officers in addition to our directors.
For the reasons stated above, on February 9, 2024, the Board unanimously determined that the proposed amendment to the Certificate is advisable and in the best interests of Dover and its stockholders, authorized and approved the proposed amendment and directed that it be considered at the Annual Meeting. The board believes the proposed amendment to the Certificate would better position our officers to exercise their business judgment in furtherance of the interests of Dover’s stockholders without the potential for distraction posed by the risk of personal liability.
Additionally, the proposed amendment would align the protections for our officers with those protections currently afforded to our directors, to the extent permitted under Delaware law.
Timing and Effect of the Proposed Amendment to the Certificate
If the proposed amendment to the Certificate is approved by our stockholders, it will become effective immediately upon its filing with the Secretary of State of the State of Delaware, which we expect will occur promptly after the annual meeting. In addition, if the proposed amendment to the Certificate is approved by our stockholders and the proposed amendment is filed with the Secretary of State of the State of Delaware, we intend to file a Sixth Restated Certificate of Incorporation to integrate and restate the Certificate, as amended by the proposed amendment to the Certificate (if approved) and any other previously adopted amendments to the Certificate into a single document.
Other than the revisions to the existing Article SEVENTEENTH, the remainder of our Certificate will remain unchanged after effectiveness of the amendment. If the proposed amendment to the Certificate is not approved by our stockholders, our Certificate will remain unchanged. In accordance with the DGCL, the board may elect to abandon the proposed amendment to the Certificate without further action by the stockholders at any time prior to the effectiveness of its filing with the Secretary of State of the State of Delaware, notwithstanding stockholder approval.
OUR BOARD UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE PROPOSED AMENDMENT TO OUR
CERTIFICATE TO REFLECT THE NEW DELAWARE LAW PERMITTING THE EXCULPATION OF OFFICERS.
DOVER CORPORATION – 2024 Proxy Statement 79
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Share Ownership Information
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information regarding the beneficial ownership, as of March 8, 2024 (except as otherwise stated), of our common stock by the following:
| • |
Each director and each of our executive officers named in the Summary Compensation Table under “Executive Compensation Tables”; |
| • |
All of the directors and executive officers as a group including the NEOs; and |
| • |
Each person known to us to own beneficially more than 5% of our outstanding common stock. |
The beneficial ownership set forth in the table is determined in accordance with the rules of the SEC. The percentage of beneficial ownership for directors and executive officers is based on 137,376,404 shares of common stock outstanding on March 8, 2024. Unless otherwise indicated in the footnotes below, the persons and entities named in the table have sole voting and investment power as to all shares beneficially owned.
|
NAME OF BENEFICIAL OWNER
|
Number of
Shares(1) |
Percentage(1) | ||||||||
|
DIRECTORS (EXCEPT MR. TOBIN): |
|
|
|
|
|
|
||||
|
DEBORAH L. DEHAAS (2) |
3,117 | * | ||||||||
|
H. JOHN GILBERTSON, JR. |
6,223 | * | ||||||||
|
KRISTIANE C. GRAHAM (3) |
192,674 | * | ||||||||
|
MARC A. HOWZE (4) |
192 |
|
|
|
||||||
|
MICHAEL F. JOHNSTON (5) |
22,515 | * | ||||||||
|
MICHAEL MANLEY (6) |
1,062 | * | ||||||||
|
DANITA K. OSTLING |
492 |
|
|
|
||||||
|
ERIC A. SPIEGEL (7) |
10,089 | * | ||||||||
|
STEPHEN M. TODD (8) |
22,955 | * | ||||||||
|
KEITH E. WANDELL |
8,664 | * | ||||||||
|
NEOS: |
|
|
|
|
|
|
||||
|
RICHARD J. TOBIN (9) |
894,560 | * | ||||||||
|
BRAD M. CEREPAK (10) |
334,803 | * | ||||||||
|
IVONNE M. CABRERA (11) |
203,884 | * | ||||||||
|
GIRISH JUNEJA (12) |
45,814 | * | ||||||||
|
KIMBERLY K. BORS (13) |
21,182 | * | ||||||||
|
DIRECTORS AND EXECUTIVE OFFICERS AS A GROUP (17 PERSONS) (14) |
1,821,872 | 1.3% | ||||||||
|
5% BENEFICIAL OWNERS: |
|
|
|
|
|
|
||||
|
BLACKROCK, INC. (15) |
9,869,911 | 7.1% | ||||||||
|
JPMORGAN CHASE CO. (16) |
14,309,617 | 10.2% | ||||||||
|
THE VANGUARD GROUP (17) |
16,496,972 | 11.8% | ||||||||
| * |
Less than one percent. |
DOVER CORPORATION – 2024 Proxy Statement 80
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SHARE OWNERSHIP INFORMATION
| (1) |
In computing the number of shares beneficially owned by an executive officer and the percentage ownership of such executive officers, we have included (i) shares of common stock subject to stock-settled appreciation rights (“SSARs”) held by that person that are currently exercisable or exercisable within 60 days of March 8, 2024 and (ii) shares of common stock subject to restricted stock units that are scheduled to vest within 60 days of March 8, 2024, subject to the executive being an employee of Dover on the date of vesting. Such shares, however, are not deemed to be outstanding for purposes of computing the percentage ownership of any other person. Information about shares held through Dover’s 401(k) plan is as of March 8, 2024; fractional shares held in 401(k) accounts have been rounded down. In computing the number of shares beneficially owned by a director and the percentage ownership of such director, we have included shares of common stock subject to deferred stock units which become payable upon the director’s termination of service. Such shares, however, are not deemed to be outstanding for purposes of computing the percentage ownership of any other person. |
| (2) |
Reflects 3,117 deferred stock units. |
| (3) |
Includes 16,477 deferred stock units. |
| (4) |
Reflects 192 deferred stock units. |
| (5) |
Includes 18,515 deferred stock units. |
| (6) |
Reflects 1,062 deferred stock units. |
| (7) |
Includes 7,724 deferred stock units. |
| (8) |
Includes 16,477 deferred stock units. |
| (9) |
Includes 3,126 deferred stock units, 636,651 shares in respect of vested SSARs, 12,495 shares in respect of restricted stock units scheduled to vest on March 15, 2024 and 466 shares held in our 401(k) plan. |
| (10) |
Includes 315,221 shares in respect of vested SSARs, 2,963 shares in respect of restricted stock units scheduled to vest on March 15, 2024 and 2,968 shares held in our 401(k) plan. |
| (11) |
Includes 167,469 shares in respect of vested SSARs, 1,286 shares in respect of restricted stock units scheduled to vest on March 15, 2024 and 1,975 shares held in our 401(k) plan. |
| (12) |
Includes 38,196 shares in respect of vested SSARs, 910 shares in respect of restricted stock units scheduled to vest on March 15, 2024 and 526 shares held in our 401(k) plan. |
| (13) |
Includes 15,093, shares in respect of vested SSARs, 791 shares in respect of restricted stock units scheduled to vest on March 15, 2024 and 328 shares held in our 401(k) plan. |
| (14) |
Includes 66,690 deferred stock units, 1,217,048 shares in respect of vested SSARs, 19,035 shares in respect of restricted stock units scheduled to vest on March 15, 2024 and 7,503 shares held in our 401(k) plan. |
| (15) |
Number of shares beneficially owned and percentage ownership based on information contained in a Schedule 13G/A filed with the SEC on January 26, 2024 by BlackRock, Inc. with respect to beneficial ownership of Dover common stock as of December 31, 2023. BlackRock reported sole voting power with regard to 8,894,175 of the shares and sole dispositive power with regard to 9,869,911 of such shares. BlackRock, Inc.’s offices are located at 55 East 52nd Street, New York, NY 10055. |
| (16) |
Number of shares beneficially owned and percentage ownership based on information contained in a Schedule 13G/A filed with the SEC on January 18, 2024 by JPMorgan Chase Co. with respect to beneficial ownership of Dover common stock as of December 29, 2023. JPMorgan Chase Co. reported sole voting power with regard to 12,983,267 of the shares, shared voting power with regard to 37,335 of the shares, sole dispositive power with regard to 14,262,908 of the shares and shared dispositive power with regard to 40,454 of the shares. JPMorgan Chase Co.’s address is 383 Madison Avenue, New York, NY 100179. |
| (17) |
Number of shares beneficially owned and percentage ownership based on information contained in a Schedule 13G/A filed with the SEC on February 13, 2024 by The Vanguard Group with respect to beneficial ownership of Dover common stock as of December 31, 2023. The Vanguard Group reported sole voting power with regard to none of the shares, shared voting power with regard to 176,131 of the shares, sole dispositive power with regard to 15,904,015 of the shares and shared dispositive power with regard to 592,957 of the shares. The Vanguard Group’s address is 100 Vanguard Blvd., Malvern, PA 19355. |
DOVER CORPORATION – 2024 Proxy Statement 81
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SHARE OWNERSHIP INFORMATION
Stock Ownership Guidelines
Our Board has adopted a policy that directors are expected to hold at any time a number of shares at least equal to the aggregate number of shares they received as the stock portion of their annual retainer during the past five years, net of an assumed 30% tax rate.
Executive officers are expected to hold a number of shares with a value at least equal to a multiple of their annual salary. For a discussion of the executive officer share ownership guidelines, see “Compensation Discussion and Analysis — Other Elements of Compensation” on page 58.
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General Information About the Annual Meeting
We are providing this Proxy Statement to our shareholders in connection with the solicitation of proxies by the Board for use at the Annual Meeting. We are mailing this Notice of Annual Meeting and Proxy Statement beginning on or about March 21, 2024.
Record Date
The record date for determining shareholders eligible to vote at the Annual Meeting is March 8, 2024. As of the close of business on that date, we had outstanding 137,376,404 shares of common stock. Each share of common stock is entitled to one vote on each matter.
Electronic Delivery of Proxy Materials
As permitted under SEC rules, we are making this Proxy Statement and our Annual Report to Shareholders (which includes our Annual Report on Form 10-K for the year ended December 31, 2023) available to shareholders electronically via the internet. We believe electronic delivery expedites receipt of our proxy materials by shareholders, while lowering the costs and reducing the environmental impact of the Annual Meeting. If you receive a notice of internet availability of proxy materials by mail, you will not receive a printed copy of the proxy materials by mail unless you specifically request them. Instead, the notice of internet availability will provide instructions as to how you may review the proxy materials and submit your voting instructions over the internet. If you receive the notice by mail and would like to receive a printed copy of the proxy materials, you should follow the instructions in the notice of internet availability for requesting a printed copy. In addition, the proxy card contains instructions for electing to receive proxy materials over the internet or by mail in future years.
Shareholders of Record; Beneficial Owners
Most holders of our common stock hold their shares beneficially through a broker, bank or other nominee rather than of record directly in their own name. As summarized below, there are some differences in the way to vote shares held of record and those owned beneficially.
If your shares are registered directly in your name with our transfer agent, you are considered the shareholder of record of those shares, and the notice of internet availability or proxy materials are being sent directly to you. As a shareholder of record, you have the right to grant your voting proxy directly to the persons named as proxy holders or to vote in person at the Annual Meeting. If you received or requested printed copies of the proxy materials, Dover has enclosed a proxy card for you to use. You may also submit your proxy on the internet or by telephone as described in the proxy card.
If your shares are held in a brokerage account or by a bank or other nominee, you are considered the beneficial owner of the shares held in “street name,” and these proxy materials are being forwarded to you by your broker or nominee who is considered the shareholder of record of those shares. As the beneficial owner, you generally have the right to direct your broker on how to vote and are also invited to attend the Annual Meeting. However, since you are not the shareholder of record, you may not vote those shares in person at the Annual Meeting unless you have a proxy, executed in your favor, from the holder of record of your shares. Your broker or nominee has enclosed a voting instruction card for you to use in directing your broker or nominee as to how to vote your shares. We strongly encourage you to instruct your broker or nominee how you wish to vote.
Vote Required; Abstentions and Broker Non-Votes; Quorum
For Proposal 1, a majority of the votes cast at the Annual Meeting is required to elect each of the directors. This means that the number of votes cast “FOR” a director must exceed the number of votes cast “AGAINST” that director in order for that director to be elected. Our organizational documents do not provide for cumulative voting.
Proposal 2 will require the affirmative vote of at least a majority of shares present in person or represented by proxy and entitled to vote thereon.
Proposal 3 is a nonbinding, advisory resolution so its ultimate adoption is at the discretion of the Board. The affirmative vote of a majority of shares present in person or by proxy and entitled to vote at the Annual Meeting will be deemed to be approval by the shareholders of Proposal 3.
Proposal 4 will require the affirmative vote of a majority of the voting power of all of the outstanding shares entitled to vote at the Annual Meeting.
DOVER CORPORATION – 2024 Proxy Statement 83
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GENERAL INFORMATION ABOUT THE ANNUAL MEETING
If you are a shareholder of record and you sign and return your proxy card or vote electronically without making any specific selection, then your shares will be voted FOR all director nominees listed in Proposal 1, and FOR Proposals 2, 3, and 4.
If you specify that you wish to “ABSTAIN” from voting on an item, then your shares will not be voted on that particular item. Abstentions will not affect the outcome of the vote on Proposal 1. However, they will have the same effect as a vote against Proposals 2, 3, and 4.
If you are a beneficial owner and hold your shares through a broker or other nominee and do not provide your broker or nominee with voting instructions, the broker or nominee will have discretionary authority to vote your shares on routine matters only and will not vote your shares on non-routine matters. This is generally referred to as a “broker non-vote.” Only Proposal 2 will be considered a routine matter for the Annual Meeting. Accordingly, a broker or other nominee will not be able to vote on Proposals 1, 3, and 4 without voting instructions. Broker non-votes will not affect the outcome of the vote on Proposals 1 and 3, but will have the same effect as a vote against Proposal 4.
For purposes of the Annual Meeting, there will be a quorum if the holders of a majority of the outstanding shares of our common stock entitled to vote at the Annual Meeting are present in person or represented by proxy. Abstentions and broker non-votes will be counted for purposes of determining if a quorum is present.
Voting Procedures
If you are a shareholder of record, you may vote in person at the Annual Meeting or submit your proxy or voting instruction form over the internet, by telephone or by mail by following the instructions provided in our notice of internet availability, in the proxy materials or in the voting instruction form. If you hold your shares beneficially in “street name” through a broker or other nominee, you must follow the instructions provided by your broker or nominee to vote your shares.
Revoking Your Proxy/Changing Your Voting Instructions
If you are a shareholder of record, whether you give your proxy over the internet, by telephone or by mail, you may revoke it at any time before it is exercised. You may submit a new proxy by using the internet or the telephone or by mailing a new proxy card bearing a later date so long as it is received before the Annual Meeting. You may also revoke your proxy by attending the Annual Meeting and voting in person, although attendance at the Annual Meeting will not, by itself, revoke your proxy. If you hold your shares beneficially in “street name” through a broker or other nominee, you must follow the instructions provided by your broker or nominee as to how you may change your voting instructions.
Shareholders Sharing the Same Address
SEC rules permit us to deliver one copy of the Proxy Statement or a notice of internet availability of the Proxy Statement to multiple shareholders of record who share the same address and have the same last name, unless we have received contrary instructions from one or more of such shareholders. This delivery method, called “householding,” reduces our printing and mailing costs. Shareholders who participate in householding will continue to receive or have internet access to separate proxy cards.
If you are a shareholder of record subject to householding and wish to receive a separate copy of the Proxy Statement or notice of internet availability of the proxy materials, now or in the future, at the same address or if you are currently receiving multiple copies of such materials at the same address and wish to receive only a single copy, please write to or call the Corporate Secretary, Dover Corporation, 3005 Highland Parkway, Downers Grove, Illinois 60515, telephone: (630) 541-1540.
Beneficial owners sharing an address who are currently receiving multiple copies of the proxy materials or notice of internet availability of the proxy materials and wish to receive only a single copy in the future, or who currently receive a single copy and wish to receive separate copies in the future, should contact their bank, broker or other holder of record to request that only a single copy or separate copies, as the case may be, be delivered to all shareholders at the shared address in the future.
Proxy Solicitation Costs
We will pay the reasonable and actual costs of printing, mailing and soliciting proxies, but we will not pay a fee to any of our officers or employees or to officers or employees of any of our subsidiaries as compensation for soliciting proxies. We have retained Morrow Sodali, LLC to solicit brokerage houses and other custodians, nominees or fiduciaries, and to send proxies and proxy materials to the beneficial owners of such shares, for a fee of approximately $12,000 plus expenses.
DOVER CORPORATION – 2024 Proxy Statement 84
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GENERAL INFORMATION ABOUT THE ANNUAL MEETING
Other Matters
Our Board and management have not received notice of, and are not aware of, any business to come before the Annual Meeting other than the agenda items referred to in this Proxy Statement. If, however, any other business properly comes before the meeting, the persons named as proxies will use their best judgment in voting the proxies.
Shareholder Proposals and Director Nominations for 2025 Annual Meeting
In order for shareholder proposals to be included in our proxy statement for the Annual Meeting of Shareholders to be held in 2025 (the “2025 Annual Meeting”), they must be received by our Corporate Secretary at our principal executive offices, 3005 Highland Parkway, Downers Grove, Illinois, 60515, no later than the close of business on November 21, 2024.
In 2016, we adopted a proxy access right to permit a shareholder or a group of up to 20 shareholders owning 3% or more of our outstanding common stock continuously for at least three years to nominate and include in our proxy materials director candidates constituting up to the greater of two individuals or 20% of the Board, provided that the shareholder(s) and the nominee(s) satisfy the requirements specified in our by-laws. In order to be timely, notice of proxy access director nominees must be received by our Corporate Secretary at our principal executive offices at the address above no earlier than the open of business on October 22, 2024 and no later than the close of business on November 21, 2024 being, respectively, 150 days and 120 days prior to the first anniversary of the date we first distributed this proxy statement.
All other shareholder nominations and proposals, in order to be voted on at the 2025 Annual Meeting, including any notice of director nominees submitted under the universal proxy card voting rules, must be received by us no earlier than the open of business on January 3, 2025, and no later than the close of business on February 2, 2025 being, respectively, 120 days and 90 days prior to the date of the first anniversary of the 2024 Annual Meeting.
Where You Can Find Additional Information
Our website is located at www.dovercorporation.com. You can view additional information on our website, such as:
| • |
Charters of our Board committees |
| • |
Corporate Governance Guidelines |
| • |
Code of Conduct |
| • |
Related Person Transactions Policy |
| • |
Standards for Director Independence |
| • |
Other governance materials and reports that we file with the SEC. Copies of these documents also may be obtained free of charge by writing or calling the Corporate Secretary, Dover Corporation, 3005 Highland Parkway, Downers Grove, Illinois 60515, telephone: (630) 541-1540. |
All Dover Corporation website addresses contained in this proxy statement are intended to be inactive, textual references only. The information on, or accessible through, any such website identified in this proxy statement is not a part of, and is not incorporated by reference into, this proxy statement.
Caution Concerning Forward-Looking Statements
This proxy statement contains forward-looking statements that are inherently subject to uncertainties and risks. We caution investors to be guided in their analysis of Dover by referring to the documents we file with the SEC, including our Annual Report on Form 10-K for 2023, for a list of factors that could cause our results to differ from those anticipated in any such forward-looking statements.
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GENERAL INFORMATION ABOUT THE ANNUAL MEETING
Non-GAAP Disclosures
In an effort to provide investors with additional information regarding our results as determined by accounting principles generally accepted in the United States of America (“GAAP”), we also disclose non-GAAP information that we believe provides useful information to investors. Adjusted net earnings, adjusted diluted net earnings per share, total segment earnings, free cash flow, free cash flow as a percentage of revenue, free cash flow as a percentage of earnings, and organic revenue growth are not financial measures under GAAP and should not be considered as a substitute for net earnings, diluted net earnings per share, cash flows from operating activities, or revenue as determined in accordance with GAAP, and they may not be comparable to similarly titled measures reported by other companies.
Adjusted Net Earnings Per Share
| (in millions, except per share data) | 2023 | 2022 | 2021 | 2020 | 2019 | |||||||||||||||
|
Adjusted net earnings: |
||||||||||||||||||||
|
Net earnings |
$ | 1,057 | $ | 1,065 | $ | 1,124 | $ | 683 | $ | 678 | ||||||||||
|
Purchase accounting expenses, pre-tax 1 |
165 | 181 | 142 | 139 | 138 | |||||||||||||||
|
Purchase accounting expenses, tax impact 2 |
(37 | ) | (42 | ) | (35 | ) | (34 | ) | (35 | ) | ||||||||||
|
Restructuring and other costs, pre-tax 3 |
64 | 39 | 38 | 51 | 32 | |||||||||||||||
|
Restructuring and other costs, tax impact 2 |
(13 | ) | (8 | ) | (7 | ) | (11 | ) | (7 | ) | ||||||||||
|
Disposition costs, pre-tax 4 |
1 | — | — | — | — | |||||||||||||||
|
Disposition costs, tax impact 2 |
— | — | — | — | — | |||||||||||||||
|
Gain on dispositions, pre-tax 5 |
— | — | (206 | ) | (5 | ) | — | |||||||||||||
|
Gain on dispositions, tax-impact 2 |
— | — | 53 | 1 | — | |||||||||||||||
|
Loss on extinguishment of debt, pre-tax 6 |
— | — | — | — | 24 | |||||||||||||||
|
Loss on extinguishment of debt, tax impact 2 |
— | — | — | — | (5 | ) | ||||||||||||||
|
Loss on assets held for sale 7 |
— | — | — | — | 47 | |||||||||||||||
|
Tax Cuts and Jobs Act 8 |
— | (23 | ) | — | — | — | ||||||||||||||
|
Adjusted net earnings |
$ | 1,237 | $ | 1,213 | $ | 1,109 | $ | 824 | $ | 872 | ||||||||||
|
Diluted average shares outstanding |
141 | 144 | 145 | 145 | 147 | |||||||||||||||
|
Adjusted diluted net earnings per common share*: |
||||||||||||||||||||
|
Diluted net earnings per share |
$ | 7.52 | $ | 7.42 | $ | 7.74 | $ | 4.70 | $ | 4.61 | ||||||||||
|
Purchase accounting expenses, pre-tax 1 |
1.18 | 1.27 | 0.98 | 0.95 | 0.94 | |||||||||||||||
|
Purchase accounting expenses, tax impact 2 |
(0.26 | ) | (0.30 | ) | (0.24 | ) | (0.24 | ) | (0.24 | ) | ||||||||||
|
Restructuring and other costs, pre-tax 3 |
0.46 | 0.26 | 0.26 | 0.35 | 0.22 | |||||||||||||||
|
Restructuring and other costs, tax impact 2 |
(0.10 | ) | (0.06 | ) | (0.05 | ) | (0.07 | ) | (0.06 | ) | ||||||||||
|
Disposition costs, pre-tax 4 |
0.01 | — | — | — | — | |||||||||||||||
|
Disposition costs, tax impact 2 |
— | — | — | — | — | |||||||||||||||
|
Gain on dispositions, pre-tax 5 |
— | — | (1.42 | ) | (0.03 | ) | — | |||||||||||||
|
Gain on dispositions, tax-impact 2 |
— | — | 0.37 | 0.01 | — | |||||||||||||||
|
Loss on extinguishment of debt, pre-tax 6 |
— | — | — | — | 0.16 | |||||||||||||||
|
Loss on extinguishment of debt, tax impact 2 |
— | — | — | — | (0.04 | ) | ||||||||||||||
|
Loss on assets held for sale 7 |
— | — | — | — | 0.32 | |||||||||||||||
|
Tax Cuts and Jobs Act 8 |
— | (0.16 | ) | — | — | — | ||||||||||||||
|
Adjusted diluted net earnings per share |
$ | 8.80 | $ | 8.45 | $ | 7.63 | $ | 5.67 | $ | 5.93 | ||||||||||
(1) Purchase accounting expenses are primarily comprised of amortization of intangible assets and charges related to fair value step-ups for acquired inventory sold during the period. FY 2022 include $19.9 million of amortization of inventory step-up, respectively, primarily related to the Q4 2021 acquisitions within our Clean Energy Fueling segment.
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(2) Adjustments were tax effected using the statutory tax rates in the applicable jurisdictions or the effective tax rate, where applicable, for each period.
(3) Restructuring and other costs relate to actions taken for headcount reductions, facility consolidations and site closures, product line exits, and other asset charges. FY 2023 includes $3.3 million of non-cash asset impairment charges for our Climate Sustainability Technologies segment. FY 2022 include $5.5 million of non-cash foreign currency translation losses reclassified to earnings included within restructuring and other costs and $2.1 million related to write-off of assets due to an exit from certain Latin America countries for our Climate Sustainability Technologies segment. FY 2021 for our Climate Sustainability Technologies segment include a $12.1 million other than temporary impairment charge related to an equity method investment and a $6.1 million write-off of assets incurred in connection with an exit from certain Latin America countries. FY 2021 includes a $9.1 million payment received for previously incurred restructuring costs related to a product line exit in our Engineered Products segment.
(4) FY 2023 disposition costs relate to the sale of De-Sta-Co which is expected to close in Q1 2024.
(5) FY2021 represents a $181.6 million gain on disposition of UB in our Climate Sustainability Technologies segment and a $24.7 million gain on disposition of our RWB equity method investment in our Engineered Products segment. FY2020 represents a gain on the sale of AMS Chino, including working capital adjustments, in our Climate Sustainability Technologies segment.
(6) Represents a loss on early extinguishment of €300,000 2.125% notes due 2020 and $450,000 4.30% notes due 2021.
(7) Represents a loss on assets held for sale of Finder Pompe S.r.l. (“Finder”). Under local law, no tax benefit is realized from the loss on the sale of a wholly-owned business.
(8) FY 2022 represents a reduction to income taxes previously recorded related to the Tax Cuts and Jobs Act.
* Per share data and totals may be impacted by rounding.
Segment Earnings
Total segment earnings is defined as the sum of earnings before purchase accounting expenses, restructuring and other costs/benefits, loss on assets held for sale, disposition costs, gain on dispositions, corporate expenses/other, interest expense, interest income and provision for income taxes for all segments. Total segment earnings margin is defined as total segment earnings divided by revenue.
| (in millions) | 2023 | 2022 | 2021 | 2020 | 2019 | |||||||||||||||
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Net earnings |
1,057 | 1,065 | 1,124 | 683 | 678 | |||||||||||||||
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Provision for income taxes 1 |
213 | 222 | 277 | 158 | 165 | |||||||||||||||
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Earnings before provision for income taxes |
1,270 | 1,288 | 1,401 | 842 | 843 | |||||||||||||||
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Interest income |
(13 | ) | (4 | ) | (4 | ) | (4 | ) | (5 | ) | ||||||||||
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Interest expense |
131 | 116 | 106 | 112 | 126 | |||||||||||||||
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Corporate expense / other 2 |
151 | 135 | 156 | 119 | 142 | |||||||||||||||
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Loss on assets held for sale 3 |
— | — | — | — | 47 | |||||||||||||||
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Disposition costs 4 |
1 | — | — | — | — | |||||||||||||||
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Gain on dispositions 5 |
— | — | (206 | ) | (5 | ) | — | |||||||||||||
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Restructuring and other costs (benefits) 6 |
64 | 39 | 38 | 51 | 32 | |||||||||||||||
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Purchase accounting expenses 7 |
165 | 181 | 142 | 139 | 138 | |||||||||||||||
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Total segment earnings |
1,768 | 1,755 | 1,633 | 1,254 | 1,324 | |||||||||||||||
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Total segment earnings margin |
21.0% | 20.6% | 20.7% | 18.8% | 18.6% | |||||||||||||||
(1) FY 2023 includes the net income tax benefit of internal reorganizations executed in 2023. FY 2022 includes a reduction to income taxes previously recorded related to the Tax Cuts and Jobs Act.
(2) Certain expenses are maintained at the corporate level and not allocated to the segments. These expenses include executive and functional compensation costs, non-service pension costs, non-operating insurance expenses, shared business services overhead costs, deal-related expenses and various administrative expenses relating to the corporate headquarters.
(3) Represents a loss on assets held for sale of Finder Pompe S.r.l. (“Finder”). Under local law, no tax benefit is realized from the loss on the sale of a wholly-owned business.
(4) FY 2023 disposition costs relate to the sale of De-Sta-Co which is expected to close in Q1 2024.
(5) Gain on dispositions includes working capital adjustments related to dispositions.
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GENERAL INFORMATION ABOUT THE ANNUAL MEETING
(6) Restructuring and other costs (benefits) relate to actions taken for headcount reductions, facility consolidations and site closures, exit costs, and other asset charges.
(7) Purchase accounting expenses are primarily comprised of amortization of intangible assets and charges related to fair value step-ups for acquired inventory sold during the period.
Free Cash Flow
Free cash flow represents net cash provided by operating activities minus capital expenditures as follows:
| (in millions) | 2023 | 2022 | 2021 | 2020 | 2019 | |||||||||||||||
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Cash flow from operating activities |
$ | 1,336 | $ | 806 | $ | 1,116 | $ | 1,105 | $ | 945 | ||||||||||
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Less: Capital expenditures |
(193 | ) | (221 | ) | (171 | ) | (166 | ) | (187 | ) | ||||||||||
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Free cash flow |
1,144 | 585 | 944 | 939 | 759 | |||||||||||||||
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Free cash flow as a percentage of revenue |
13.6% | 6.9% | 11.9% | 14.1% | 10.6% | |||||||||||||||
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Free cash flow as a percentage of adjusted net earnings |
92.5% | 48.2% | 85.2% | 113.9% | 87.0% | |||||||||||||||
Organic Revenue Growth Factor
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2023
Full Year |
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Organic |
(1.5)% | |||
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Acquisitions |
0.9% | |||
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Currency translation |
(0.2)% | |||
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Total |
(0.8)% | |||
Adjusted net earnings represents net earnings adjusted for the effect of purchase accounting expenses, restructuring and other costs/benefits, Tax Cuts and Jobs Act, disposition costs, gain on dispositions, loss on extinguishment of debt, and loss on assets held for sale. Purchase accounting expenses are primarily comprised of amortization of intangible assets and charges related to fair value step-ups for acquired inventory sold during the period. We exclude after-tax purchase accounting expenses because the amount and timing of such charges are significantly impacted by the timing, size, number and nature of the acquisitions the Company consummates. While we have a history of acquisition activity, our acquisitions do not happen in a predictive cycle. Exclusion of purchase accounting expenses facilitates more consistent comparisons of operating results over time. We believe it is important to understand that such intangible assets were recorded as part of purchase accounting and contribute to revenue generation. We exclude the other items because they occur for reasons that may be unrelated to the Company’s commercial performance during the period and/or management believes they are not indicative of the Company’s ongoing operating costs or gains in a given period.
Adjusted diluted net earnings per share or adjusted earnings per share represent diluted EPS adjusted for the effect of purchase accounting expenses, restructuring and other costs/benefits, Tax Cuts and Jobs Act, disposition costs, gain on dispositions, loss on extinguishment of debt, and loss on assets held for sale.
Management believes these measures are useful to investors to better understand the Company’s ongoing profitability as it will better reflect the Company’s core operating results, offer more transparency and facilitate easier comparability to prior and future periods and to its peers.
Free cash flow represents net cash provided by operating activities minus capital expenditures. Free cash flow as a percentage of revenue equals free cash flow divided by revenue. Free cash flow as a percentage of adjusted net earnings equals free cash flow divided by adjusted net earnings. Management believes that free cash flow and free cash flow ratios are important measures of liquidity because they provide management and investors a measurement of cash generated from operations that is available for mandatory payment obligations and investment opportunities, such as funding acquisitions, paying dividends, repaying debt and repurchasing our common stock.
Management believes that reporting organic revenue growth, which excludes the impact of foreign currency exchange rates and the impact of acquisitions and dispositions, provides a useful comparison of our revenue and bookings performance and trends between periods.
DOVER CORPORATION – 2024 Proxy Statement 88
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DOVER CORPORATION 3005 HIGHLAND PARKWAY DOWNERS GROVE, IL 60515 |
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VOTE BY INTERNET - www.proxyvote.com or scan the QR Barcode above |
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| Use the Internet to transmit your voting instructions and for electronic delivery of information. Vote by 11:59 p.m. Eastern Time on May 2, 2024 for shares held directly and by 11:59 p.m. Eastern Time on April 30, 2024 for shares held in a Plan. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. | ||||||
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ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS |
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| If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years. | ||||||
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VOTE BY PHONE - 1-800-690-6903 |
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Use any touch-tone telephone to transmit your voting instructions. Vote by 11:59 p.m. Eastern Time on May 2, 2024 for shares held directly and by 11:59 p.m. Eastern Time on April 30, 2024 for shares held in a Plan. Have your proxy card in hand when you call and then follow the instructions.
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VOTE BY MAIL |
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Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
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TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
V29878-P04473-Z86844 KEEP THIS PORTION FOR YOUR RECORDS
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DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
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DOVER CORPORATION |
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The Board of Directors recommends a vote FOR each director under Item 1: |
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1. Election of Directors
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For | Against | Abstain |
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1a. D. L. DeHaas |
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The Board of Directors recommends a vote FOR Items 2, 3 and 4: |
For | Against | Abstain | ||||||||||||||||||||||||||||||
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1b. H. J. Gilbertson, Jr. |
☐ | ☐ | ☐ |
2. To ratify the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for 2024. |
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1c. K. C. Graham |
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1d. M. A. Howze |
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3. To approve, on an advisory basis, named executive officer compensation.
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1e. M. F. Johnston |
☐ | ☐ | ☐ |
4. To approve an amendment to the Company’s Fifth Restated Certificate of Incorporation to reflect recent Delaware law provisions regarding officer exculpation.
NOTE: Such other business as may properly come before the meeting or any adjournment thereof.
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1f. M. Manley |
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1g. D. K. Ostling |
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1h. E. A. Spiegel |
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1i. R. J. Tobin |
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1j. K. E. Wandell |
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Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer. |
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Signature [PLEASE SIGN WITHIN BOX] |
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Signature (Joint Owners) |
Date |
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Table of Contents
WE ENCOURAGE YOU TO TAKE ADVANTAGE OF INTERNET OR TELEPHONE VOTING,
BOTH ARE AVAILABLE 24 HOURS A DAY, 7 DAYS A WEEK.
Internet and telephone voting are available through 11:59 PM Eastern Time
the day before the annual meeting date.
Your Internet or telephone vote authorizes the named proxies to vote these shares in the
same manner as if you marked, signed and returned your proxy card.
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INTERNET http://www.proxyvote.com Use the Internet to vote your proxy. Have your proxy card in hand when you access the website.
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OR |
TELEPHONE 1-800-690-6903 Use any touch-tone telephone to vote your proxy. Have your proxy card in hand when you call. |
If you vote your proxy by Internet or telephone, you do NOT need to mail back your proxy card.
To vote by mail, sign and date your proxy card and return it in the enclosed postage-paid envelope.
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Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice and Proxy Statement and Annual Report are available at www.proxyvote.com .
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V29879-P04473-Z86844
PROXY
DOVER CORPORATION
PROXY SOLICITED BY BOARD OF DIRECTORS FOR ANNUAL MEETING
MAY 3, 2024
The undersigned hereby appoints Richard J. Tobin, Brad M. Cerepak, Ivonne M. Cabrera and John C. Nelson, and each of them, as the undersigned’s proxy or proxies, each with full power of substitution, to vote all shares of Common Stock of Dover Corporation which the undersigned is entitled to vote at the Annual Meeting of Shareholders to be held in Lombard, IL on May 3, 2024 at 9:00 A.M., local time, and any adjournments thereof, as fully as the undersigned could if personally present, upon the proposals set forth on the reverse side hereof, revoking any proxy or proxies heretofore given. For participants in the Company’s Retirement Savings Plan, this proxy will govern the voting of stock held for the account of the undersigned in the Plan.
IMPORTANT - You have the option of voting these shares by returning the enclosed proxy card, voting via Internet or by using a toll-free telephone number above and on the reverse side. On the reverse side of this proxy card are instructions on how to vote via the Internet or by telephone. If you vote by either of these methods, your vote will be recorded as if you mailed in your proxy card. If you vote by returning this proxy card, you must sign and date this proxy on the reverse side.
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE SPECIFICATIONS MADE ON THE REVERSE SIDE, BUT IF NO CHOICES ARE INDICATED, THIS PROXY WILL BE VOTED FOR ALL NOMINEES LISTED ON THE REVERSE SIDE AND FOR PROPOSALS 2, 3, AND 4.
Continued and to be signed on reverse side