SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or
240.14a-12
Dover Corporation
- --------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
Robert Kuhback
- --------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[x] $125 per Exchange Act Rules 0-11(c)(1)(ii),
14a-4(i)(1),or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to
Exchange Act Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and )-11.
1. Title of each class of securities to which transaction applies:
__________________________________________
2. Aggregate number of securities to which transaction applies:
__________________________________________
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule O-11:(1).
__________________________________________
4. Proposed maximum aggregate value of transaction:
__________________________________________
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule )-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1. Amount Previously Paid:
___________________________________________
2. Form, Schedule or Registration Statement No.:
___________________________________________
3. Filing Party:
__________________________________________
- --------
(1) Set forth the amount on which the filing fee is calculated and state how
it was determined.
DOVER CORPORATION
NOTICE OF THE ANNUAL MEETING OF STOCKHOLDERS
March 15, 1994
To the Stockholders:
Please take notice that the annual meeting of stockholders of
Dover Corporation will be held at Suite L-100, 32 Loockerman Square,
Dover, Delaware, on April 26, 1994, at 10:00 A.M., for the following
purposes:
1. To elect ten directors; and
2. To transact such other business as may properly come before
the meeting.
Only holders of record of the outstanding common stock at the close
of business on February 28, 1994 are entitled to notice of and to vote at the
meeting or any adjournments thereof.
By authority of the Board of Directors,
ROBERT G. KUHBACH
Secretary
STOCKHOLDERS WHO DO NOT PLAN TO ATTEND THE MEETING ARE REQUESTED TO SIGN
AND DATE THE ENCLOSED PROXY AS SOON AS POSSIBLE AND MAIL IT IN THE ENCLOSED
ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
<PAGE>1
DOVER CORPORATION
PROXY STATEMENT
GENERAL
This statement is furnished to the stockholders of Dover Corporation
(hereinafter called "Dover"), whose principal executive offices are at 280
Park Avenue, New York, N. Y. 10017, in connection with the solicitation of
proxies by the Board of Directors for use at the annual meeting of
stockholders to be held on April 26, 1994 or any adjournments thereof, for
the purposes set forth in the notice of meeting. Dover will pay the
reasonable and actual costs of soliciting proxies, but no amount will be paid
to any officer or employee of Dover or its subsidiaries as compensation for
soliciting proxies. In addition to solicitation by mail, Dover has retained
Morrow & Co. to solicit brokerage houses and other custodians, nominees or
fiduciaries and to send proxies and proxy material to the beneficial owners
of such shares, at a cost not to exceed $6,500. The approximate date on which
this statement and the proxy form are to be first sent to the stockholders
will be March 15, 1994.
As of the close of business on February 28, 1994, the record date for
voting, Dover had outstanding 57,168,745 shares of common stock. Each share
of common stock is entitled to one vote on all matters. To the best of
Dover's knowledge, no stockholder owns beneficially as much as 5% of the
outstanding common stock other than (1) Magalen O. Bryant, Post Office Box
247, Middleburg, Va. 22117, who owns 3,382,303 shares (5.92%) including
298,938 shares held in a trust in which she is a co-trustee sharing voting
and investment powers and in which she disclaims any beneficial interest and
(2) Cooke & Bieler Inc., 1700 Market Street, Philadelphia, PA 19103 which
owned 3,765,785 shares (6.6%) as of December 31, 1993.
According to its Schedule 13G filed with the Securities and Exchange
Commission, Cooke & Bieler, Inc., have sole voting power over 2,851,885 of
such shares and no voting power over the remainder.
The independent certified public accounting firm of KPMG Peat Marwick,
New York, N. Y., is the principal independent public accountant selected for
auditing the annual accounts of Dover and its subsidiaries for the current
fiscal year. That firm has been the principal independent certified public
accountant for Dover for many years. Representatives of that firm are not
expected to be present at the annual meeting.
DOVER WILL PROVIDE WITHOUT CHARGE TO EACH PERSON SOLICITED HEREIN, ON
THE WRITTEN REQUEST OF ANY SUCH PERSON, A COPY OF DOVER'S 1993 ANNUAL REPORT
ON FORM 10-K INCLUDING THE SCHEDULES THERETO, FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION. A REQUEST THEREFOR SHOULD BE DIRECTED TO THE CORPORATE
SECRETARY AT DOVER'S OFFICE, 280 PARK AVENUE, NEW YORK, N. Y. 10017.
The shares covered by each proxy will be voted for the election of the
10 nominees or their substitutes as indicated below unless directed otherwise
in the proxy, in which case the shares will be voted as directed.
The proxy also grants discretionary authority to the proxies in connection
with other matters that may properly come before the meeting.
A person giving a proxy may revoke it at any time before it is exercised
by written notice to the secretary of Dover at the address referred to above
or by attending the meeting and requesting in writing a return of the proxy.
<PAGE>2
SECURITY OWNERSHIP
The following table provides information as of February 28, 1994, as
reported to the Company by the persons and members of the group listed, as to
the number of shares and the percentage of the Dover's common stock
beneficially owned by: (i) each Director (ii) each executive officer listed
in the compensation table and (iii) all Directors and executive officers of
Dover as a group.
NAME OF DIRECTOR,
OFFICER OR NUMBER OF
PERSONS IN GROUP NUMBER OF SHARES PERCENTAGE
------------------- ---------------- -------------
John B. Apple 79,747(1) *
Magalen O. Bryant 3,083,365(2) 5.39
298,938(3) 0.52
Lewis E. Burns 63,072(4) *
Michael C. Devas 6,400 *
John F. Fort 23,000 *
James L. Koley 3,000 *
John F. McNiff 62,473(5) *
George L. Ohrstrom 380,742 *
210,472(6) *
Anthony J. Ormsby 29,000(7) *
John E. Pomeroy 30,228(8) *
Thomas L. Reece 69,630(9) *
Gary L. Roubos 191,565(10) *
David G. Thomas 5,000 *
Jerry W. Yochum 20,145(11) *
Executive Officers and Directors as
a Group 4,672,236(12) 8.17
- -----
* Less than one percent.
(1) Includes 42,587 shares which are subject to options exercisable within
60 days.
(2) Includes 76,240 shares held by a corporation over which she has control.
(3) Held in a trust of which she is a co-trustee sharing voting and
investment powers and in which she disclaims any beneficial interest.
(4) Includes 32,047 shares which are subject to options exercisable within
60 days.
(5) Includes 45,511 shares which are subject to options exercisable within
60 days.
(6) Held in a trust of which he is a co-trustee sharing voting and
investment powers and in which he disclaims any beneficial interest.
(7) Includes 25,000 shares in a personal holding company as to which he
disclaims any beneficial interest.
(8) Includes 25,408 shares which are subject to options exercisable within
60 days.
(9) Includes 31,925 shares which are subject to options exercisable within
60 days.
(10) Includes 100,083 shares which are subject to options exercisable within
60 days.
(11) Includes 18,254 shares which are subject to options exercisable within
60 days.
(12) Includes 347,770 shares which are subject to options held by executive
officers and directors exercisable within 60 days.
<PAGE>3
1. ELECTION OF DIRECTORS
The proxies will vote the shares covered by a proxy for the election as
directors of the 10 nominees listed below unless directed otherwise in the
proxy, in which case the shares will be voted as directed. If any such
nominee for election is not for any reason a candidate for election at the
meeting, an event which management does not anticipate, the proxies will be
voted for a substitute nominee or nominees as may be designated by the Board
of Directors and for the others named below. All the nominees, except Mr.
Yochum, are presently directors. Mr. Yochum replaces Lewis E. Burns, under a
program of rotating directors elected from operating management. Each
director elected at the annual meeting will serve until the election and
qualification of his successor.
Directors will be elected by a plurality of the votes cast. Only votes
cast for a nominee will be counted, except that the accompanying proxy will
be voted for the nominees in the absence of instructions to the contrary.
Abstentions, broker non-votes, and instructions on the accompanying proxy
card to withhold authority to vote for one or more of the nominees will
result in the respective nominees receiving fewer votes.
<TABLE>
<CAPTION>
BUSINESS EXPERIENCES FOR
PAST FIVE YEARS, YEAR FIRST
POSITIONS WITH DOVER, BECAME
NAME AND AGE AND OTHER DIRECTORSHIPS DIRECTOR
------------ ----------------------- --------
<S> <C> <C>
Magalen O. Bryant(1) Director of Carlisle Companies Incorporated and O'Sullivan 1979
65 Corp. (industrial manufacturing); Member of Executive and
Compensation Committees.
Michael C. Devas Chairman [London Board], Colonial Mutual Life Assurance 1967
69 Society, Ltd.; formerly Chairman (through Jan. 1993),
Kleinwort Charter Investment Trust plc (financial management);
Member of Audit Committee.
John F. Fort Director of Tyco International Ltd. (fire protection systems and 1989
52 industrial products), formerly Chairman (through Jan. 1993)
and Chief Executive Officer (through July 1992); Member of
Executive and Compensation Committees.
James L. Koley President, Koley, Jessen, Daubman & Rupiper, P.C. (law firm); 1989
63 Director of Arts-Way Manufacturing Co., Inc. (agricultural
manufacturing); Member of Audit Committee.
George L. Ohrstrom(1) Partner, G. L. Ohrstrom & Co. (investment firm). Director 1964
66 of Carlisle Companies Incorporated, Roper Industries, Inc.
and Harrow Industries, Inc. (industrial manufacturing).
Anthony J. Ormsby Private investor; Member of Executive and Audit Committees. 1971
67
Thomas L. Reece President of Dover since May 1993; prior thereto, Vice President 1993
51 of Dover and President of Dover Resources, Inc.
Gary L. Roubos Chief Executive Officer of Dover since 1981, Chairman of the 1976
57 Board of Dover since August 1989 and President of Dover from
May 1977 to May 1993; Director of Omnicom Group, Inc.
(advertising), Scott Paper Company (paper products) DOVatron
International, Inc. (contract manufacturing) and The Treasurers
Fund (financial management); Member of Executive Committee.
<PAGE>4
David G. Thomas Chairman of The Fleming Enterprise Investment Trust, plc, 1979
68 London, U.K. (financial management); Director of Carlisle
Companies, Incorporated (industrial manufacturing) and
Interface, Inc. (building products); Member of Executive and
Compensation Committees.
Jerry W. Yochum Vice President of Dover and President of Dover Diversified, Inc. --
<FN>
- -----
(1) Magalen O. Bryant and George L. Ohrstrom are sister and brother.
</TABLE>
During 1993 the Board of Directors held four meetings. Dover has a
standing Audit Committee. The functions of the Audit Committee consist of
annually recommending to the Board of Directors the appointment or change in
independent auditors; reviewing with management and such auditors the plan
and results of the auditing engagement; and reviewing management's program
for ensuring the adequacy of Dover's system of internal accounting controls.
In 1993, the Audit Committee held three meetings. Members of the Committee
are Michael C. Devas, Anthony J. Ormsby and James L. Koley. Dover has an
Executive Committee which is generally empowered to act unanimously on behalf
of its Board and meets or otherwise takes action on an as needed basis
between the regularly scheduled quarterly Board meetings. The Executive
Committee did not hold a formal meeting during 1993. Members of the Executive
Committee are Magalen O. Bryant, John F. Fort, Anthony J. Ormsby, Gary L.
Roubos and David G. Thomas. Dover also has a Compensation Committee,
currently consisting of Magalen O. Bryant, John F. Fort and David G. Thomas.
The Compensation Committee approves compensation for corporate executives,
grants under the stock option plan and performance program and other material
compensation plan changes. In 1993, the Compensation Committee held one
meeting. Dover has no standing nominating committee or any other committee.
Management directors receive no compensation for services as a director
or as a member of any Committee. Each of the other directors receives $25,000
a year ($27,000 effective January 1, 1994), plus an additional $12,000 a year
($10,000 effective January 1, 1994) if he/she is a member of the Executive
Committee and an additional $2,500 ($3,000 effective January 1, 1994) if he
is a member of the Audit Committee. Each of the other directors also receives
$1,000 ($1,500 effective January 1, 1994), for each meeting attended.
Effective February 3, 1994, a non-contributory, unfunded retirement plan
for outside directors was adopted. Only outside directors with five or more
years of service as a Dover director are covered. The retirement benefit will
commence at age 70, Dover's mandatory retirement age for directors and will
be equal to the base fee at retirement (currently $27,000 per year) payable
monthly. A director may elect an actuarily reduced joint and survivorship
benefit; the benefit is to continue for the lesser of years of service on the
Dover board or life. The benefit will be reduced by any other pension benefit
received from Dover.
James L. Koley is President of Koley, Jessen, Daubman & Rupiper, P.C.,
a Nebraska law firm which has performed legal services on behalf of Dover.
<PAGE>5
COMPENSATION
The Summary Compensation Table below shows all remuneration paid by Dover and
its subsidiaries on an accrual basis for each of the five calendar years
ended December 31, 1993, to the Chief Executive Officer and the six other
most highly paid executive officers for services in all capacities.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG-TERM COMPENSATION
------------------- ----------------------
AWARDS PAYOUTS
------ -------
OTHER LONG-TERM
ANNUAL SECURITIES INCENTIVE ALL OTHER TOTAL
NAME AND COMPEN- UNDERLYING PLAN COMPENSATION CASH
PRINCIPAL POSITION YEAR SALARY BONUS SATION(1) OPTIONS (#) PAYOUTS (2) COMPENSATION
- ------------------ ---- ------ ------ --------- ----------- --------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Gary L. Roubos 1993 $610,000 $300,000 -- 15,770 -- $324,979 $1,234,979
Chairman of the
Board; President 1992 575,000 230,000 -- 17,490 $ 9,900 250,240 1,065,140
of Dover until
May 1993 1991 550,000 215,000 -- 19,110 9,875 124,758 929,633
1990 525,000 250,000 -- 19,410 363,812 32,002 1,170,814
1989 500,000 225,000 -- 21,270 387,332 25,769 1,138,101
Thomas L. Reece 1993 400,000 230,000 -- 7,240 -- 23,462 653,462
Vice President and
President of Dover 1992 350,000 140,000 -- 8,030 90,214 318,580 898,794
since May 1993
of Dover; 1991 312,500 130,000 -- 6,290 -- 17,160 459,660
Director and
President of Dover 1990 300,000 130,000 -- 6,250 55,348 18,624 503,972
Resources, Inc.
until May 1993 1989 275,000 105,000 -- 6,650 -- 13,168 393,168
John B. Apple 1993 405,000 140,000 -- 7,800 -- 14,443 559,443
Director and Vice
President of Dover; 1992 405,000 145,000 -- 9,030 -- 15,971 565,971
Director and
President of Dover 1991 405,000 135,000 -- 8,700 19,849 13,725 573,574
Elevator
International, Inc. 1990 375,000 225,000 -- 9,030 489,601 13,985 1,103,586
1989 325,000 210,000 -- 9,010 277,318 11,454 823,772
Lewis E. Burns 1993 355,000 235,000 -- 6,810 -- 165,572 755,572
Director and
Vice President
of Dover; 1992 323,000 125,000 -- 7,240 104,310 98,877 651,187
Director and
President of Dover 1991 315,000 110,000 -- 6,080 1,125 38,120 464,245
Industries, Inc. 1990 290,000 125,000 -- 5,870 -- 10,590 425,590
1989 275,000 90,000 -- 6,740 39,486 8,441 412,927
John F. McNiff 1993 305,000 190,000 -- 7,020 -- 319,500 814,500
Vice-President
Finance and
Treasurer of Dover 1992 290,000 152,000 -- 7,880 4,644 118,990 565,634
1991 282,500 145,000 8,720 18,675 17,284 463,459
1990 275,000 170,000 -- 9,110 167,575 17,936 630,511
1989 260,000 155,000 -- 9,960 161,230 13,266 589,496
John E. Pomeroy 1993 295,000 195,000 -- 5,750 19,916 43,556 553,472
Vice President
of Dover; 1992 264,000 110,000 -- 5,920 -- 111,093 485,093
Director and
President of Dover 1991 240,000 90,000 -- 4,350 -- 38,460 368,460
Technologies, Inc. 1990 240,000 75,000 -- 5,190 -- 33,816 348,816
1989 225,000 95,000 6,040 406,327 30,659 756,986
Jerry W. Yochum 1993 315,000 210,000 -- 6,450 277,313 43,051 845,364
Vice President
of Dover; 1992 290,000 140,000 -- 7,780 144,000 87,272 661,272
Director and
President of Dover 1991 275,000 175,000 -- 5,870 215,418 70,619 736,037
Diversified, Inc. 1990 250,000 150,000 -- 6,180 193,049 38,134 631,183
1989 175,000 150,000 -- 4,460 146,543 44,132 515,675
<PAGE>6
<FN>
- -----
(1) Disclosure is required for a) the dollar amount of perquisites if such
amounts exceed the lesser of either $50,000 or 10% of total salary plus
bonus (here they do not) and b) four other specific categories of
compensation, none of which are here applicable.
(2) Represents company contributions to the Dover Savings and Investment
Plan, annual increase in the company's obligation to participants under
in the Executive Deferred Income Plan or similar accrual, stock option
bonus, company payments to other defined contribution plans, and company
paid insurance premiums on split-dollar term life insurance. For 1993
these amounts are detailed as follows:
</TABLE>
[CAPTION]
<TABLE>
EXECUTIVE OTHER
DOVER DEFERRED STOCK DEFINED
SAVINGS INCOME OPTION CONTRIBUTION INSURANCE
PLAN PLAN BONUS(a) PLANS PREMIUMS TOTAL
------- ------ -------- ------------ ---------- --------
<S> <C> <C> <C> <C> <C> <C>
G.L. Roubos $7,195 $32,634 $285,150 $324,979
T.L. Reece 7,195 16,267 23,462
J.B. Apple 3,598 10,845 14,443
L.E. Burns 3,598 25,757 126,076 $10,141 165,572
J.F. McNiff 7,195 16,267 296,038 319,500
J.E. Pomeroy 2,699 13,556 27,301 43,556
J.W. Yochum 4,947 32,534 $5,570 43,051
<FN>
- -----
(a) Certain of Dover's stock options are "incentive" stock options (i.e.,
tax qualified) stock options. After the repeal by the 1986 Tax Reform
Act of the preferential treatment of capital gains, the primary
difference between a nonqualified option and an incentive stock option
is that upon exercise of a nonqualified option, the holder will be
required to include in income as compensation for tax purposes the
excess of the value of the stock on the exercise date over the option
price. Dover obtains a tax deduction to the extent of that compensation.
In contrast, the exercise of an incentive stock option has no ordinary
income tax consequences. Dover has determined that it would be in its
best interests if such options were converted to nonqualified options
when exercised. During the five-year period 1989 to 1993, in order to
induce such incentive stock option holders to convert to a nonqualified
option at date of exercise, Dover paid each exercising holder a cash
bonus equal to 66% or 59% in 1993, 59% (1992 and 1991), and 35%
(1989-1990) of Dover's tax deduction.
</TABLE>
<PAGE>7
STOCK OPTION PLAN AND CASH PERFORMANCE PROGRAM
The Company has an Incentive Stock Option Plan and Cash Performance
Program, adopted in 1984 and recently extended one year through January 1995,
which provides for stock options coordinated with performance awards. At the
time of grant, allocations are made such that of each combined award, greater
emphasis is given to cash performance awards at the operating level and
greater emphasis is given to stock options at the corporate level.
Information on current grants and cash performance awards is shown below. For
payouts on prior awards see the Summary Compensation Table on page 5.
<TABLE>
<CAPTION>
OPTION GRANTS DURING 1993
NUMBER OF % OF TOTAL
SECURITIES OPTIONS
UNDERLYING GRANTED TO GRANT DATE
OPTIONS EMPLOYEES EXERCISE EXPIRATION PRESENT
NAME GRANTED DURING 1993 PRICE DATE VALUE (1)
---- ------- ----------- ------ ---- ---------
<S> <C> <C> <C> <C> <C>
Gary L. Roubos 16,183 8.1% $45.692 March 4, 2003 $193,711
Thomas L. Reece 7,429 3.7 45.692 March 4, 2003 88,925
John B. Apple 8,004 4.0 45.692 March 4, 2003 95,808
Lewis E. Burns 6,988 3.5 45.692 March 4, 2003 83,646
John F. McNiff 7,204 3.6 45.692 March 4, 2003 86,232
John E. Pomeroy 5,901 3.0 45.692 March 4, 2003 70,635
Jerry W. Yochum 6,617 3.3 45.692 March 4, 2003 79,205
<FN>
- -----
(1) Dover asked an outside adviser to value its stock options based upon the
Black-Scholes model. His response indicated a range of between 32% and
49% of option grant price, depending upon volatility and maturity. Dover
chose 35.9% (volatility 25%, maturity 8 years), which resulted in an
option value on date of grant of $16.40 per share. The Black-Scholes
model assumes an option that is not cancellable and which can be sold at
any time for cash. Therefore, Dover deducted 17% based upon its ten year
historical cancellation rates and another 10% based upon the company's
expectation that, except in cases of unusual need, shares acquired
through the exercise of options are to be held by participants for the
duration of their employment with Dover. This resulted in a final value
of $11.97 per share.
(2) The options become exercisable on February 6, 1996.
(3) The number of shares granted for this group of officers is based upon a
multiple, ranging from .70 to .88, of the aggregate of current base
salary plus current annual cash bonus. The multiple was determined by
independent compensation consultants. The number of shares that may be
granted to each participant is not otherwise limited and prior grants
are not considered by the Compensation Committee when current grants are
awarded. However, when the Plan was approved by the stockholders in
1984, the number of shares that could be granted under the ten year
program was limited to 4,800,000. At December 31, 1993, 3,063,898 shares
remained available out of the 4,800,000 authorization.
</TABLE>
<PAGE>8
<TABLE>
<CAPTION>
AGGREGATED STOCK OPTION EXERCISES IN 1993 AND DECEMBER 31, 1993 OPTION VALUES
NUMBER OF
SECURITIES VALUE (4) OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
STOCK OPTIONS STOCK OPTIONS
AT 12/31/93 AT 12/31/93
SHARES ----------------------- ------------------------ NUMBER
ACQUIRED OF SHARES
UPON VALUE UNEXER- UNEXER- OWNED AT
NAME EXERCISE* REALIZED(1) EXERCISABLE CISABLE EXERCISABLE CISABLE 12/31/93
---- --------- ----------- ------------ -------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Gary L. Roubos 25,203 $1,016,819(2) 80,473 53,741 $2,445,586 $1,075,421 91,482
Thomas L. Reece -- -- 25,470 22,125 771,444 437,010 37,705
John B. Apple -- -- 33,658 26,198 719,413 523,299 37,160
Lewis E. Burns 4,659 191,026(3) 25,808 20,657 705,401 407,712 31,025
John F. McNiff 13,053 448,542(2) 36,563 24,238 1,107,170 485,716 16,962
John E. Pomeroy -- -- 20,944 16,440 631,686 321,995 4,820
Jerry W. Yochum -- -- 14,121 20,627 410,549 409,567 0
<FN>
- -----
* In accordance with company policy, each individual listed continues to
hold these shares.
(1) Represents the gain (i.e., fair market value less exercise price)
realized upon exercise of stock options during 1993 which remains in
Dover shares.
(2) Gain for options granted in 1985 & 1986.
(3) Gain for options granted in 1986.
(4) Represents the difference between the fair market value of the stock at
December 31, 1993, and the exercise prices.
</TABLE>
LONG-TERM INCENTIVE PLAN
CURRENT ANNUAL AWARD
ESTIMATED
FUTURE
PAYOUTS UNDER
JANUARY PERFORMANCE NON-STOCK
1994 MEASUREMENT PRICED BASED
NAME AWARD(1) PERIOD PLANS(2)
---- -------- ------ --------
Gary L. Roubos $200,000 1994-1996 $160,000
Thomas L. Reece 136,000 1994-1996 29,000
John B. Apple 161,025 1994-1996 157,000
Lewis E. Burns 182,400 1994-1996 29,000
John F. McNiff 91,800 1994-1996 70,000
John E. Pomeroy 152,475 1994-1996 85,000
Jerry W. Yochum 163,875 1994-1996 195,000
- -----
(1) The "award" shown above for this group of officers is based upon a
multiple, ranging from .18 to .30, of the aggregate of current base
salary plus current annual cash bonus. The multiples were determined by
independent compensation consultants.
The actual cash payout at the end of the three year performance
measurement period will be derived from a matrix, or table, consisting
of a) real (inflation adjusted) growth in earnings and b) return on
investment (ROI).
<PAGE>9
There will be no payout if growth in earnings is not achieved; there
will be no payout if ROI is less than 10 percent. Moreover, the earnings
in the base year (the year preceding the award year) from which earnings
growth is measured, may not be less than an amount equal to a 10 percent
ROI.
There is no limit on the amount of the payout except that the aggregate
payout at each plan location may not exceed an amount equal to 20% of
average annual nominal earnings increase over the three year performance
period. The same plan is applied to three separate "Business Units" as
follows: (a) the entire company for corporate officers, (b) the market
segment subsidiaries for their respective officers, and (c) operating
businesses for their respective officers.
(2) Amounts shown in this column represent the average payout for the past
five years as indicated on the Summary Compensation Table.
PENSION AND OTHER RETIREMENT BENEFITS
Dover has many non-contributory defined benefit and defined contribution
pension plans covering substantially all employees of the Company and its
domestic and foreign subsidiaries. Dover also has an unfunded Supplemental
Executive Retirement Plan and other similar unfunded retirement programs
("SERPs") which provide retirement benefits for eligible employees including
certain officers of Dover and its subsidiaries. Pursuant to those plans,
payments will be made at the appropriate time (e.g., retirement) to such
officers and other plan participants.
Benefits under various defined benefit plans and SERPs are based
generally upon final pay averages, excluding any payments under the cash
performance award program or of stock option bonuses, and on the years of
benefit service. Generally, vesting occurs after completion of 5 years of
employment subsequent to age 18. The following table shows the estimated
annual benefits payable upon retirement to persons in the specified
remuneration and years of service classifications. The years of covered
employment for eligible persons named in the Summary Compensation Table are:
Mr. Roubos 18, Mr. Reece 21, Mr. Apple 30, Mr. Burns 24, Mr. McNiff 11, and
Mr. Yochum 11. All of these persons are vested. The benefit amounts listed
in the table do not include Social Security Benefits which the covered
employee may be entitled to.
<TABLE>
<CAPTION>
YEARS OF SERVICE
---------------------------------------------------------------------
REMUNERATION 15 20 25 30 35
- ------------ -- -- -- -- --
<S> <C> <C> <C> <C> <C>
$150,000 $ 31,800 $ 42,400 $ 53,100 $ 63,700 $ 74,300
200,000 43,100 57,400 71,800 86,200 100,500
250,000 54,300 72,400 90,600 108,700 126,800
300,000 65,600 87,400 109,300 131,200 153,000
350,000 76,800 102,400 128,100 153,700 179,300
400,000 88,100 117,400 146,800 176,200 205,500
450,000 99,300 132,400 165,600 198,700 231,800
500,000 110,600 147,400 184,300 221,200 258,000
550,000 121,800 162,400 203,100 243,700 284,300
600,000 133,100 177,400 221,800 266,100 310,500
650,000 144,300 192,400 240,600 288,600 336,800
700,000 155,600 207,400 259,300 311,100 363,000
750,000 166,800 222,400 278,100 333,600 389,300
</TABLE>
<PAGE>10
During 1993 under the Dover Employee Savings and Investment Plan, a
salaried employee could contribute from 2% to 18% of his compensation (but
not more than $8,994) for investment under the Plan in one or more of a Dover
Common Stock Fund, a Short Term Investment Fund, a Balanced Fund or two
Common Stock Funds. These employee contributions are made by Dover on behalf
of the participant by salary reduction under Section 401(k) of the Internal
Revenue Code. For 1993 Dover contributed to the Dover Common Stock Fund an
amount (based upon performance) equal to from 40% to 80% of the amount
contributed (of the first 6% of compensation) by each employee. All balances
in the Plan are immediately 100% vested in the participant. No withdrawals
during employment are permitted under the Plan but a participant may obtain
a loan for certain specified purposes in varying amounts. For 1993 Dover
accrued $58,012 with respect to participating executive officers as a group.
Of this amount the following was accrued with respect to each of the seven
highest paid executive officers and directors: Mr. Roubos $7,195, Mr. Reece
$7,195, Mr. Apple $3,598, Mr. Burns $3,598, Mr. McNiff $7,195, Mr. Pomeroy
$2,699, and Mr. Yochum $4,947, which amounts have been included in the
Summary Compensation Table.
In addition to the foregoing, Dover has a deferred compensation plan
which allowed senior managers (including most current executive officers) an
opportunity to defer an amount of salary over four years which would be
repaid to such executives over 15 years upon normal retirement or commencing
at age 65 if employment terminates earlier together with interest generally
at 12 1/2%. Dover purchased whole life insurance policies to fund its
obligations under this executive deferred income plan. With respect to Mr.
Burns who did not participate in this plan, an annual accrual is made to
provide a similar retirement benefit. For current amounts relevant to the
seven highest paid officers and directors, see footnote 2 on page 6.
TERMINATION ARRANGEMENTS
CHANGE OF CONTROL ARRANGEMENTS:
The Company has agreements with Mr. Roubos and certain other officers
including those shown on the Summary Compensation Table designed to encourage
each such officer to continue to carry out his duties with the Company in the
event of a potential change of control of the Company. The agreements provide
that if within 18 months following a change of control of the Company the
officer's employment is terminated either by the Company for other than cause
or disability or by such officer for good reason, then such officer will
receive a lump sum payment equal to 1) the highest base salary (but not bonus
or any other compensation) received by such officer in any of the most recent
five years, or 2) if such officer is then more than 45 years old and has been
with the Company for more than three years the lump sum payment will equal
twice such base salary. Also, in the event of a change of control, the
present value of certain unfunded deferred compensation plans will be paid
immediately to such officers in a lump sum, and the exercisability of stock
options held for more than six months will be accelerated.
The Internal Revenue Code imposes certain excise taxes on, and limits
the deductibility of, certain compensatory payments made by a corporation to
or for the benefit of certain individuals if such payments are contingent
upon certain changes in ownership of a substantial portion of the assets of
the corporation and have an aggregate present value in excess of three times
the individual's annualized includible compensation for the base period, as
defined in the code. Although Dover payments would not be expected to reach
this amount, the agreements limit the compensation payments thereunder to
amounts which can be paid by the Company without adverse tax consequences.
<PAGE>11
COMPENSATION COMMITTEE REPORT
As indicated on page 4, the Compensation Committee of the Board of
Directors is composed entirely of independent outside directors. The
Committee, which superseded the Executive Committee with respect to
compensation matters, was established in February 1992. The Compensation
Committee administers the Dover incentive stock option and cash performance
program. In this capacity the Committee makes or approves all stock option
grants and awards to Company officers and executives under the terms of the
plan. The Committee also makes or approves annual compensation for corporate
officers and any changes in compensation programs. Specifically with respect
to the Chief Executive Officer, the Compensation Committee determined his
bonus for 1993 to be $300,000, and increased his salary, effective January 1,
1994 to $750,000. These determinations were based upon, a) outside
independent compensation data which indicated the percentage relationship of
bonus to 1993 salary (bonus to salary relationships from outside sources
ranged from 67% to 74% with a weighted average of 70%; however, the bonus to
the Dover Chief Executive Officer has historically been below that level), b)
the amount of the prior year bonus, c) the 1993 23.7% increase in earnings
per share achieved by the Company, d) the general business environment during
1993 and e) a subjective judgment factor which is the prerogative of the
committee, and included the opinion that 1993 had been an excellent
acquisition year. In addition, the Committee reviews annually the list of
operating company presidents, which compares salary and total annual
compensation with sales and earnings for each operating company in order of
rank. From time to time, but not less than once every five years, the
Committee reviews studies done by its independent compensation consultant as
to the competitiveness of the Company's overall compensation program.
The Committee's basic overriding compensation principle is that
compensation at the corporate level, the independent subsidiary level, and at
the operating president level be linked to total return to stockholders
generally and relative to other comparable companies. This is done annually
with salaries and bonus, on a medium (three year) basis with the cash
performance program, and long-term with stock options. Performance awards and
stock option grants are annual, but payouts on cash awards, if earned, occur
three years later and options are generally for 10 years, but are not
exercisable for three years. Compensation to be paid to the executive
officers for 1994 is expected to qualify for deductibility for federal income
tax purposes under Section 162(m) of the Internal Revenue Code.
The Committee reviews the Company's performance annually. The
compensation programs of the Company are highly leveraged on the basis of
performance. The Company has for years performed in the top quartile as
measured by the Management Compensation Services Project 777 database, which
currently includes over 40% of the Fortune 500 Industrials. The average rank
in the database, which determines the overall standing, is the average of the
following nine separate measurements: return on equity for 1 year, and
5 years; return on capital for 1 year, and 5 years; return on sales current
year; return on assets 1 year, and 5 years; and total capital return 1 year,
and 5 years. The Committee has determined that as long as the Company
continues this level of performance, salary and bonuses will be targeted at
the 75th percentile. Should the Company's performance fall below that level,
compensation targets will be adjusted downward. Annual bonuses vary with
annual performance based upon earnings growth, return on investment,
achievement of special company goals as well as the Committee's judgment of
overall performance. The Committee believes that all compensation, i.e.,
annual, medium-term and long-term, should be closely aligned to the
performance of the business over which the executive has the most control.
<PAGE>12
With respect to pensions and other benefit type programs, the Committee
has set a target at the median of comparable companies.
Dover's management, the Committee and the Board of Directors believe
that Dover stock ownership is desirable and important in aligning the
interests of Dover officers and executives with Dover stockholders. However,
only officers and executives who are in a position to affect materially the
profitability and growth of the Company are eligible for stock options. The
number of optionees in each annual grant averages just under one percent of
the total number of Dover employees. The annual shares granted has averaged
about 1/3 of 1% of shares outstanding over the past 5 years and was of 1% in
1993. Dover expects that, except in cases of unusual need, shares acquired
through options will be held by participants for the duration of their
employment with the Company.
Magalen O. Bryant
John F. Fort
David G. Thomas
<PAGE>13
STOCK PERFORMANCE GRAPH
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
DOVER CORPORATION, S&P 500 INDEX & PEER GROUP INDEX
[GRAPH]
This graph assumes $100 invested on December 31, 1988 in Dover Corporation
common stock, S&P 500 index and a peer group index. Each mark on the axis
displaying the years 1988 through 1993 represents December 31 of that year.
The peer index is the Media General Financial Services Group 30-Metal Fabrica
tion Companies which consists of the following: ABC Rail Products CP, ABS
Ind. Inc., ACX Technologies Inc., American Locker Group, Amtrol Inc.,
Atchison Casting CP, Besicorp Group, Bliss & Laughlin Ind., Chart Ind.,
Chemi-Trol Chemical Co., Commercial Intertech CP, Commercial Metals Co.,
Cryenco Sciences Inc., Denovo CP, Douglas & Lomason Co., Dover CP, Eastern
Co., Elco Ind. Inc., Explosive Fabricators, Fansteel Inc., General Cable,
Graham CP, Howell Ind. Inc., Insteel Ind. Inc., Internat Aluminum CP,
Johnstown American Ind., Magnetic Technologies CP, Material Sciences CP,
Met-Coil Systems CP, Milastar CP, MLX CP, Moog Inc. CL A, Moog Inc. CL B,
Omni U.S.A. Inc., Palmer Tube Mills Ltd., Pitt-DesMoines Inc., Publicker
Ind., RB&W CP, Rexnord CP, Semicon Packing Material, Steel Technologies Inc.,
Synalloy CP, Temtex Ind. Inc., Thermal Ind., Thermodynetics Inc., Trimas CP,
Trinity Ind., Varlen CP, Wyman-Gordon Co., and Zero CP.
- -----
* Total return assumes reinvestment of dividends.
<PAGE>14
2. OTHER MATTERS
Management does not know of any other business to be taken up at the
annual meeting. If, however, any other business properly comes before the
meeting or any adjournments thereof, the persons named as proxies will vote
the shares covered by a proxy in accordance with their best judgments on such
matters.
STOCKHOLDER PROPOSALS FOR 1995 ANNUAL MEETING
Stockholder proposals properly includible in Dover's proxy statement
must be received by Dover at its principal executive offices, 280 Park
Avenue, New York, N.Y. 10017 by November 18, 1994. All other stockholder
proposals, including nominations for directors, must be received by Dover not
less than 60 days nor more than 90 days prior to the Annual Meeting, which is
scheduled for April 25, 1995.
Dated: March 15, 1994
By authority of the Board of Directors,
ROBERT G. KUHBACH
Secretary
<PAGE>
PROXY PROXY
DOVER CORPORATION
PROXY SOLICITED BY BOARD OF DIRECTORS FOR ANNUAL MEETING, APRIL 26, 1994.
The undersigned hereby appoints Gary L. Roubos, Robert G. Kuhbach, and John
N. Marden, or any of them, as the undersigneds proxy or proxies, 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 Stockholders to be held in Dover, Delaware, on April 26, 1994 at 10:00
A.M., Dover time, and any adjournments thereof, as fully as the undersigned
could if personally present, upon the proposal set forth on the reverse side
hereof revoking any proxy or proxies heretofore given.
IMPORTANT - This Proxy must be signed and dated 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.
PLEASE MARK VOTE IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY.
1994
P
R
O
X
Y
1. Election of Directors Nominees: M.O. Bryant, M.C. Devas, J.F. Fort,
J.L. Koley, G.L. Ohrstrom, A.J. Ormsby, T.L. Reece, G.L. Roubos,
D.G. Thomas and Jerry W. Yochum.
2. In their discretion, upon such other matters as properly may come
before the meeting.
The Board of Directors recommends a Vote FOR Proposal 1.
Date _________________ 1994
Please Sign Here and Return Promptly
____________________________________
____________________________________
Please sign exactly as your name or names appear above. For joint accounts,
each owner should sign. When signing as executor, administrator, attorney,
trustee or guardian, etc., please give your full title.
