<PAGE> 1
LOGO
------
NOTICE OF THE ANNUAL MEETING OF STOCKHOLDERS
------
March 15, 1995
TO THE STOCKHOLDERS:
Please take notice that the annual meeting of stockholders of DOVER
CORPORATION will be held at the 3rd Floor Conference Room, Wilmington Trust
Company, 1100 North Market Street, Rodney Square North, Wilmington, Delaware
19890, on April 25, 1995, at 10:00 A.M., for the following purposes:
1. To elect eleven directors;
2. To ratify and approve the 1995 Incentive Stock Option Plan and 1995 Cash
Performance Program;
3. To ratify and approve a loan provision amendment to the 1984 Incentive
Stock Option Plan to facilitate option exercises under that Plan; and
4. 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, 1995 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> 2
DOVER CORPORATION
PROXY STATEMENT
GENERAL
This statement is furnished to the stockholders of Dover Corporation
(hereinafter called the "Company" or "Dover"), whose principal executive
offices are at 280 Park Avenue, New York, NY 10017, in connection with the
solicitation of proxies by the Board of Directors for use at the Annual
Meeting of Stockholders (the "Meeting") to be held on April 25, 1995 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 $7,000. The
approximate date on which this statement and the proxy form are to be first
sent to the stockholders will be March 15, 1995.
As of the close of business on February 28, 1995, the record date for
voting, Dover had outstanding 56,680,404 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 3,425,383 shares (6.0%) 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
3,672,809 shares (6.5%) as of December 31, 1994. According to its Schedule
13G filed with the Securities and Exchange Commission, Cooke & Bieler, Inc.
has sole voting power over 2,818,185 of such shares and sole investment power
over 3,489,209 of such shares.
The independent certified public accounting firm of KPMG Peat Marwick, New
York, NY, 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 1994 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, NY 10017.
The shares covered by each proxy will be voted for the election of the
eleven (11) nominees or their substitutes as indicated below, for the
ratification and approval of the 1995 Incentive Stock Option Plan and 1995
Cash Performance Program (the "1995 Plan"), and for the loan provision
amendment to the 1984 Incentive Stock Option Plan (the "1984 Plan"), 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.
Shares abstaining, and shares held in street name as to which a broker has
not voted on some matters but has voted on other matters ("Broker
Non-Votes"), will be included in determining whether a quorum exists at the
Meeting. Approval of each matter specified in the notice of meeting requires
the affirmative vote of a majority, or, in the case of the election of
directors, a plurality, of shares of common stock present in person or by
proxy at the Meeting and entitled to vote thereon. Stockholders may not
1
<PAGE> 3
cumulate their votes. In determining whether a proposal specified in the
notice of meeting has received the requisite number of affirmative votes,
abstentions and Broker Non-Votes will have the same effect as votes against the
proposal, except with respect to the election of directors where abstentions and
Broker Non-Votes will result in the respective nominees receiving fewer votes
but will have no effect on the outcome of the vote.
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.
SECURITY OWNERSHIP
The following table provides information as of February 28, 1995, as
reported to the Company by the persons and members of the group listed, as to
the number of shares and the percentage of Dover's common stock beneficially
owned by: (i) each Director and nominee for Director, (ii) each executive
officer listed in the compensation table and (iii) all Directors, nominees
and executive officers of Dover as a group.
<TABLE>
<CAPTION>
Number of Shares Percentage
---------------- ------------
<S> <C> <C>
John B. Apple ........................ 92,892(1) *
David H. Benson ...................... 1,000 *
3,126,445(2) 5.5
Magalen O. Bryant .................... 298,938(3) 0.53
Lewis E. Burns ....................... 70,502(1) *
Jean-Pierre M. Ergas ................. 5,000 *
Roderick J. Fleming ................. --
John F. Fort ......................... 23,000 *
Rudolf J. Herrmann .................. 9,917(1) *
James L. Koley ...................... 4,500(4) *
John F. McNiff ...................... 72,390(1) *
Anthony J. Ormsby .................... 29,000(5) *
John E. Pomeroy ...................... 36,692(1) *
Thomas L. Reece ...................... 83,882(1) *
Gary L. Roubos ...................... 215,865(1) *
David G. Thomas ...................... 5,000 *
Jerry W. Yochum ...................... 39,211(1) *
Directors and Officers as a Group 4,182,666(1) 7.4
</TABLE>
* Less than one percent.
- ------
(1) Includes shares which are subject to options exercisable within 60 days
for the following person(s): Mr. Apple, 44,608 shares; Mr. Burns, 33,525
shares; Mr. Herrmann, 5,100 shares; Mr. McNiff, 45,839 shares; Mr. Pomeroy,
31,843 shares; Mr. Reece, 40,165 shares; Mr. Roubos, 118,031 shares; Mr.
Yochum, 20,349 shares; and all directors and officers as a group, 356,351
shares.
(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 2,500 shares held in various retirement trusts for Mr. Koley and
his spouse.
(5) Includes 25,000 shares in a personal holding company as to which he
disclaims any beneficial interest.
2
<PAGE> 4
1. ELECTION OF DIRECTORS
The proxies will vote the shares covered by a proxy for the election as
directors of the eleven (11) 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 Messrs.
Benson and Fleming, are presently directors. 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.
<TABLE>
<CAPTION>
Business Experience for
Past Five Years, Year First
Positions with Dover, Became
Name and Age and other Directorships Director
- ---------------------- -------------------------------------------------------------- ------------
<S> <C> <C>
David H. Benson....... Non-Executive Director and formerly Vice Chairman of --
57 Kleinwort-Benson Group Plc.; Chairman, Kleinwort Charter
Investment Trust Plc (financial management); Director of The
Rouse Company (real estate development); Director of Harrow
Corporation (industrial manufacturing); Non-Executive Director
of British Gas Plc and Marshall Cavendish Ltd.; Trustee of The
Charities Official Investment Fund and The Pilot Funds
(financial management).
Magalen O. Bryant..... Director of Carlisle Companies Incorporated and O'Sullivan Corp. 1979
66 (industrial manufacturing).
Jean-Pierre M. Ergas.. Senior Advisor to the President and Chief Executive Officer, 1994
55 Alcan Aluminum, Ltd. (aluminum manufacturer); previously
Chairman and Chief Executive Officer of American National Can
Company (beverage can manufacturer).
Roderick J. Fleming... Director, Robert Fleming Holdings Ltd. (financial management); --
41 previously International Portfolio Director (through November
1991), Director, Capital Markets (through July 1993), and
Director of Corporate Finance UK (through April 1994) at Robert
Fleming; also Director of Aurora Exploration and Development
Corporation Ltd. (natural resources); Updown Investment Company
Ltd. (financial management); and West Rand Consolidated Mines
Limited (natural resources).
John F. Fort.......... Director of Tyco International Ltd. (fire protection systems and 1989
53 industrial products); formerly Chairman (through January 1993)
and Chief Executive Officer (through July 1992); Director, Scott
Paper Company (paper products).
James L. Koley........ Chairman, Koley, Jessen, Daubman & Rupiper, P.C. (law firm); 1989
64 Chairman of the Board of Directors of Arts-Way Manufacturing
Co., Inc. (agricultural manufacturing).
Anthony J. Ormsby..... Private investor. 1971
68
</TABLE>
[table continues on following page]
3
<PAGE> 5
<TABLE>
<CAPTION>
Business Experience for
Past Five Years, Year First
Positions with Dover, Became
Name and Age and other Directorships Director
- ---------------------- ------------------------------------------------------------- ------------
<S> <C> <C>
Thomas L. Reece....... President (since May 1993) and Chief Executive Officer (since 1993
52 May 1994) of Dover; prior thereto Vice President of Dover and
President of Dover Resources, Inc.
Gary L. Roubos........ Chairman of the Board of Dover since August 1989; previously 1976
58 Chief Executive Officer (through May 1994) and President
(through May 1993) of Dover for more than five years; Director
of Bell & Howell Holdings (information management); DOVatron
International Inc. (contract manufacturing); Omnicom Group, Inc.
(advertising); Scott Paper Company (paper products) and The
Treasurers Fund (financial management).
David G. Thomas....... Chairman of the Fleming Enterprise Investment Trust Plc, 1979
69 (financial management); Director of Carlisle Companies,
Incorporated (industrial manufacturing) and Interface, Inc.
(carpet manufacturing).
Jerry W. Yochum....... Vice President of Dover and President of Dover Diversified, Inc. 1994
56
</TABLE>
During 1994, the Board of Directors held four meetings. The Board has
three standing committees, namely an Audit Committee, a Compensation
Committee and an Executive Committee.
The Audit Committee is composed of three directors who are not employees
of the Company. The functions of the Audit Committee consist of annually
recommending to the Board of Directors the appointment of the independent
auditors; reviewing with management and such auditors the 1995 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
1994, the Audit Committee held three meetings. Current members of the Audit
Committee are Anthony J. Ormsby (Chairman), Jean-Pierre M. Ergas (replacing
Michael C. Devas who retired in August 1994), and James L. Koley.
The Compensation Committee is composed of three directors who are not
employees of the Company. It approves compensation for corporate executive
officers, grants, awards and payouts under the stock option plan and
performance program and minor compensation plan changes. In 1994, the
Compensation Committee held two meetings. Its current members consist of John
F. Fort (Chairman), Magalen O. Bryant and David G. Thomas.
The Executive Committee is composed of six directors. The Executive
Committee is generally empowered to act unanimously on behalf of the Board
and meets or otherwise takes action on an as needed basis between the
regularly scheduled quarterly Board meetings. The Executive Committee held
two meetings during 1994. Current members of the Executive Committee are Gary
L. Roubos (Chairman), Magalen O. Bryant, John F. Fort, Anthony J. Ormsby,
Thomas L. Reece and David G. Thomas.
During fiscal year 1994, except for one director who missed one meeting,
every director attended all of the meetings of the Board of Directors and
Committees on which he or she served.
4
<PAGE> 6
DIRECTORS' COMPENSATION
Management directors receive no compensation for services as a director or
as a member of any Committee. Each of the other directors receives a base fee
of $27,000, plus an additional $10,000 a year if he or she is a member of the
Executive Committee and an additional $3,000 if he or she is a member of the
Audit Committee. Each of the other directors also receives $1,500 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
commences at age 70, Dover's mandatory retirement age for directors, and
continues for the lesser of such director's years of service on the Dover
board or life. The annual retirement benefit is equal to the base fee at
retirement (currently $27,000 per year), payable monthly. A director may
elect an actuarially reduced joint and survivorship benefit. The benefit will
be reduced by any other pension benefit received from Dover.
James L. Koley is Chairman of Koley, Jessen, Daubman & Rupiper, P.C., a
Nebraska law firm which has performed legal services on behalf of Dover.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The Summary Compensation Table below shows all remuneration paid by Dover
and its subsidiaries on an accrual basis to the Chief Executive Officer and
the seven other most highly paid executive officers for services in all
capacities for each of the five calendar years ended December 31, 1994, or
such lessor period that a person was an executive officer.
<TABLE>
<CAPTION>
Annual Long-Term
Compensation(1)(2) Compensation
--------------------- ------------------------
Awards Payouts
------------ -----------
Long-term
Securities Incentive All
Name and Underlying Plan Other
Principal Position Year Salary Bonus Options(#) Payouts Compensation(3)
- -------------------------------- ------ ----------- --------- ------------ ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Gary L. Roubos .................... 1994 $750,000 $ 0 13,460 $389,312 $ 43,993
Chairman of the Board; CEO of 1993 610,000 300,000 15,770 0 250,240
Dover until May 1994; President 1992 575,000 230,000 17,490 9,900 124,758
of Dover until May 1993 1991 550,000 215,000 19,110 39,875 43,002
1990 525,000 250,000 21,270 363,812 25,769
Thomas L. Reece ................... 1994 450,000 400,000 9,140 209,304 25,693
CEO of Dover since May 1994; 1993 400,000 230,000 7,240 0 23,462
Director and President of Dover 1992 350,000 140,000 8,030 90,214 318,580
since May 1993; Director and 1991 312,500 130,000 6,290 0 17,160
President of Dover Resources, 1990 300,000 130,000 6,250 55,348 18,624
Inc. until May 1993
John B. Apple ..................... 1994 425,000 115,000 6,310 0 15,896
Vice President of Dover; 1993 405,000 140,000 7,800 0 14,443
Director and President of Dover 1992 405,000 145,000 9,030 0 15,971
Elevator International, Inc. 1991 405,000 135,000 8,700 19,849 13,725
1990 375,000 225,000 9,030 489,601 13,985
</TABLE>
[table continues on following page]
5
<PAGE> 7
<TABLE>
<CAPTION>
Annual Long-Term
Compensation(1)(2) Compensation
--------------------- ------------------------
Awards Payouts
------------ -----------
Long-term
Securities Incentive All
Name and Underlying Plan Other
Principal Position Year Salary Bonus Options(#) Payouts Compensation(3)
- -------------------------------- ------ ----------- --------- ------------ ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Lewis E. Burns ................... 1994 405,000 235,000 7,150 390,947 42,200
Vice President of Dover; 1993 355,000 235,000 6,810 0 165,572
Director and President of Dover 1992 323,000 125,000 7,240 104,310 98,877
Industries, Inc. 1991 315,000 110,000 6,080 1,125 38,120
1990 290,000 125,000 5,870 0 10,590
Rudolf J. Herrmann ................ 1994 325,000 225,000 5,030 232,064 7,392
Vice President of Dover; 1993 224,000 125,000 1,520 41,552 7,195
Director and President of Dover
Resources, Inc. since May 1993
John F. McNiff .................... 1994 320,000 240,000 6,170 175,392 25,697
Vice President-Finance and 1993 305,000 190,000 7,020 0 319,500
Treasurer of Dover 1992 290,000 152,000 7,880 0 118,990
1991 282,500 145,000 8,720 4,644 17,284
1990 275,000 170,000 9,110 18,675 17,936
John E. Pomeroy ................... 1994 340,000 210,000 5,980 432,818 35,292
Vice President of Dover; 1993 295,000 195,000 5,750 19,916 43,556
Director and President of Dover 1992 264,000 110,000 5,920 0 111,093
Technologies, Inc. 1991 240,000 90,000 4,350 0 38,460
1990 240,000 75,000 5,190 0 33,816
Jerry W. Yochum ................... 1994 365,000 220,000 6,430 445,814 58,818
Director and Vice President 1993 315,000 210,000 6,450 277,313 43,051
of Dover; Director and President 1992 290,000 140,000 7,780 144,000 87,272
of Dover Diversified, Inc. 1991 275,000 175,000 5,870 215,418 70,619
1990 250,000 150,000 6,180 193,049 38,134
</TABLE>
- ------
(1) The bonus amount is determined as described in the Compensation Committee
Report on page 10 of this proxy statement. Cash bonuses for the fiscal years
shown have been listed in the year earned, and were generally paid in
February of the following fiscal year.
(2) Perquisites and other personal benefits paid to each officer in each
instance aggregated less than either $50,000 or 10% of total salary plus
bonus, and accordingly are omitted from the table.
(3) Represents company contributions to the Dover Savings and Investment
Plan, annual increase in the Company's obligation to participants under the
Executive Deferred Income Plan or similar accrual, Company payments to other
defined contribution plans, Company paid insurance premiums on split-dollar
term life insurance and payments for financial counseling. For 1994, these
amounts are detailed as follows:
6
<PAGE> 8
<TABLE>
<CAPTION>
Executive Other
Dover Deferred Defined
Savings Income Contribution Insurance Financial
Name Plan Plan Plans Premiums Counseling Total
- ------------------- --------- ----------- -------------- ----------- ------------ ---------
<S> <C> <C> <C> <C> <C> <C>
G. L. Roubos ...... $7,392 $36,601 $43,993
T. L. Reece ....... 7,392 18,301 25,693
J. B. Apple ....... 3,696 12,200 15,896
L. E. Burns ....... 3,696 31,454 $ 7,050 42,200
R. J. Herrmann .... 7,392 7,392
J. F. McNiff ...... 7,392 18,301 25,697
J. E. Pomeroy ..... 6,006 15,250 14,037 35,293
J. W. Yochum ...... 7,392 36,601 $5,570 $9,255 58,818
</TABLE>
STOCK OPTION PLAN AND CASH PERFORMANCE PROGRAM
The Company had an Incentive Stock Option Plan and Cash Performance
Program, adopted in 1984 and extended one year through January 1995, which
provided for stock options coordinated with performance awards. At the time
of grant, allocations were made such that of each combined award, greater
emphasis was given to cash performance awards at the operating level and
greater emphasis was given to stock options at the corporate level.
Information on stock option grants made in 1994, stock option exercises
during 1994, year end option grant values and cash performance awards granted
for the three-year period ended in 1997 are shown in the tables below. For
calendar year 1994 payouts on prior cash performance awards, see the Summary
Compensation Table on page 5. For stock option awards made in February 1995,
subject to stockholder ratification, see page 15.
OPTION GRANTS IN LAST CALENDAR YEAR
<TABLE>
<CAPTION>
Number of % of Total
Securities Options
Underlying Granted to Exercise Grant Date
Options Employees in Price Expiration Present
Name Granted(#)(1) Calendar Year ($/Share) Date Value($)(2)
- ---------------------- ------------ --------------- ---------- ----------------- ------------
<S> <C> <C> <C> <C> <C>
Gary L. Roubos ....... 13,460 6.9 $59.50 February 27, 2004 $230,704
Thomas L. Reece ...... 9,140 4.7 59.50 February 27, 2004 156,660
John B. Apple ........ 6,310 3.2 59.50 February 27, 2004 108,153
Lewis E. Burns ....... 7,150 3.7 59.50 February 27, 2004 122,558
Rudolf J. Herrmann ... 5,030 2.6 59.50 February 27, 2004 86,214
John F. McNiff ....... 6,170 3.2 59.50 February 27, 2004 105,754
John E. Pomeroy ...... 5,980 3.1 59.50 February 27, 2004 102,497
Jerry W. Yochum ...... 6,430 3.3 59.50 February 27, 2004 110,210
</TABLE>
- ------
(1) The options become exercisable on January 27, 1997.
(2) The modified Black-Scholes model used to calculate the hypothetical
values at date of grant considers a number of factors to estimate the
option's present value, including the stock's historic volatility calculated
using the average daily market price of the Company's common stock over a one
year period prior to the grant date, the exercise period of the option,
interest rates and the stock's expected dividend yield. This resulted in a
range of discount values, and Dover's compensation consultant opined that a
value for industrial companies like Dover of 40% of grant price was
appropriate. The assumptions used in the model for this valuation were:
7
<PAGE> 9
average stock price volatility -- 28%; exercise period -- 5 years; interest
rate -- 7 1/2%; and dividend yield -- 0%. In addition, the Black-Scholes model
assumes an option is not cancelable and can be sold at any time for cash. Since
those assumptions are not applicable here, the Company reduced grant prices an
additional 18% 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 grant
value of $17.14 per share.
AGGREGATED OPTION EXERCISES IN LAST CALENDAR YEAR AND YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
Number of Securities
Underlying Value (1) of Unexercised
Shares Unexercised Options at In-The-Money Options at
Acquired Year End(#) Year End($)
----------------------- ------------------------
on Value(1) Unexer- Unexer-
Name Exercise (#) Realized ($) Exercisable cisable Exercisable cisable
- ------------------ ------------ ------------ ------------- --------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Gary L. Roubos .... -- -- 100,083 47,591 $1,973,891 $329,124
Thomas L. Reece ... -- -- 31,935 23,580 625,644 150,851
John B. Apple ..... 7,245 185,679 35,342 23,580 645,638 167,818
Lewis E. Burns .... -- -- 32,047 21,568 633,739 137,976
Rudolf J. Herrmann -- -- 5,377 8,324 95,230 31,777
John F. McNiff .... 7,758 201,278 37,753 21,460 697,012 147,759
John E. Pomeroy ... -- -- 25,408 17,956 500,486 113,934
Jerry W. Yochum ... 7,779 182,613 7,984 8,423 187,056 31,777
</TABLE>
- ------
(1) Calculated by determining the difference between the exercise price and
the closing market price of Dover common stock (as reported on the New York
Stock Exchange-Composite Transactions) for the exercise dates or December 31,
1994, as the case may be.
LONG-TERM INCENTIVE PLAN AWARDS FOR CALENDAR YEAR 1995
(SUBJECT TO STOCKHOLDER RATIFICATION)
<TABLE>
<CAPTION>
Performance or Estimated Future
Other Period Payouts Under Non-
February 1995 Until Maturation Stock Price
Name Award or Payout Based Plans(1)
- ---------------------- --------------- ---------------- ------------------
<S> <C> <C> <C>
Gary L. Roubos ....... $ 16,550 1995 - 1997 $ 16,550
Thomas L. Reece ...... 213,675 1995 - 1997 213,675
John B. Apple ........ 251,708 1995 - 1997 251,708
Lewis E. Burns ....... 305,168 1995 - 1997 305,168
Rudolf J. Herrmann ... 278,438 1995 - 1997 278,438
John F. McNiff ....... 79,063 1995 - 1997 79,063
John E. Pomeroy ...... 267,300 1995 - 1997 267,300
Jerry W. Yochum ...... 267,300 1995 - 1997 267,300
</TABLE>
- ------
(1) The actual cash payout at the end of the three year performance
measurement period will be equal to the award amount multiplied by a
percentage which is derived from a performance matrix, or table, which uses
two performance parameters, namely: 1. (a) real (inflation adjusted) growth
in earnings per share, or (b) real growth in operating earnings; and 2. (a)
return on equity or (b) return on investment (ROI).
8
<PAGE> 10
There will be no payout if growth in earnings is not achieved; there will
be no payout if return on equity or 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 10
percent of equity or 10 percent of ROI.
There is a $2 million limit on the amount of any annual individual payout,
and the aggregate payout at each appropriate business unit 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.
Given the foregoing, the range of payouts is large. For the past five
years, the amounts shown in the Payout Column of the Summary Compensation
Table represent percentage payouts from zero to 526% of the award given three
years prior to the year of the payout. Accordingly, the amounts shown in this
column, payable in February 1998, have been set at 100% of the February 1995
grants, which would represent a 100% achievement on the aforementioned
matrix. This could be achieved with real average annual earnings growth of 7%
and a ROI/Return on Equity of 13% over the three-year performance period, or
various other similar combinations of growth and ROI.
RETIREMENT PLANS
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 average compensation, defined as the highest 60 months of
compensation out of the last 120 months and on the years of benefit service.
Compensation for plan purposes includes salary and annual bonus but excludes
any payments under the cash performance award program or stock option
bonuses. Generally, vesting occurs after completion of five 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 19, Mr. Reece 22, Mr. Apple 31, Mr. Burns 25, Mr. Herrmann 6, Mr.
McNiff 12, and Mr. Yochum 12. All of these persons are vested. The benefit
amounts listed in the table do not include Social Security Benefits to which
the covered employee may be entitled.
9
<PAGE> 11
PENSION PLAN TABLE
<TABLE>
<CAPTION>
Years of Service
-----------------------------------------------------
Final Average Compensation 15 20 25 30 35
- -------------------------- --------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
$ 400,000 $ 87,000 $116,000 $144,900 $173,900 $202,900
500,000 109,500 146,000 182,400 218,900 255,400
600,000 132,000 176,000 219,900 263,900 307,900
700,000 154,500 206,000 257,400 308,900 360,400
800,000 177,000 236,000 294,900 353,900 412,900
900,000 199,500 266,000 332,400 398,900 465,400
1,000,000 222,000 296,000 369,900 443,900 517,900
1,100,000 244,500 326,000 407,400 488,900 570,400
</TABLE>
TERMINATION ARRANGEMENTS
The Company has agreements with Mr. Roubos, Mr. Reece and 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. For purposes of these
agreements (and under the 1995 Plan and the 1984 Plan as well), a "change of
control" occurs generally when (a) a person becomes beneficial owner of 20%
or more of the Company's common stock, (b) as a result of a business
combination or tender offer, a majority of the Board of Directors changes, or
(c) the stockholders approve a merger or other business combination, as a
result of which the Company ceases to be an independent public company. The
agreements provide that if within eighteen (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 of 1986, as amended (the "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 the
ownership or effective control of the corporation or in the ownership of a
substantial portion of the assets of the corporation, and have an aggregate
present value of at least three times the individual's annualized includable
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.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee (the "Committee") of the Board of Directors is
composed entirely of independent outside directors. The Committee approves
10
<PAGE> 12
annual compensation for corporate executive officers, administers the Dover
incentive stock option and cash performance program and any minor changes in
other compensation programs. 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 executive
compensation program. This was done in 1994 and the results of that review are
reflected in this report.
A. EXECUTIVE COMPENSATION POLICY
The Committee's basic overriding compensation principle is that
compensation at the corporate level, the independent subsidiary level, and at
the operating president level should be linked to total return to
stockholders generally and relative to other comparable companies. The
Committee also 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. This is done annually with salaries
and bonuses, on a medium-term (three-year) basis with the cash performance
program, and on a long-term basis with stock options. The relative "mix" of
medium- and long-term opportunity is also adjusted with increasingly larger
percentage allocated to long-term reward potential the higher the recipient
is in the organization. Performance awards and stock option grants are
annual, but payouts on cash awards, if earned, occur three years later and
options generally have a 10-year term, but are not exercisable for three
years. With respect to pensions and other benefit type programs, the
Committee has set a target at the median of comparable companies.
Substantially all compensation to be paid to the executive officers for 1995
is expected to qualify for deductibility for federal income tax purposes
under Section 162(m) of the Code.
Annual Compensation: 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 (the "Project 777 database"), which currently includes approximately
40% of the Fortune 500 Industrials. The Project 777 database includes a
substantially larger number of companies than the peer index group referred
to in connection with the Stock Performance Graph below. The average rank in
the Project 777 database, which determines the overall standing, is the
average of the following nine separate measurements: return on equity for one
year and five years; return on capital for one year and five years; return on
sales current year; return on assets one year and five years; and total
capital return one and five years. As a result of the 1994 compensation
review mentioned above, the Committee has determined that as long as the
Company continues to perform in the top quartile, salaries and bonuses will
be targeted at the 60th to the 75th percentile for all company executives.
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 and achievement of special company
goals as well as the Committee's judgment of overall performance.
Long-Term Compensation: Dover's management, the Committee and the Board of
Directors believe that tangible (cash) and intangible (stock) incentives
should be provided to key management at each of the three levels within the
Company over some longer period of time. Given the different levels and
opportunities to impact Dover's long-term growth, and hence benefit Dover's
stockholders, Dover has had, and proposes this year to continue, a long-term
compensation program including both stock options and cash incentive awards.
Only officers and executives who are in a position to affect materially the
profitability and growth of the Company are eligible for stock options and
incentive awards. Both the 1984 Plan and the proposed 1995 Plan (discussed in
greater detail below) basically provide a "mix" of the two incentives, with
operating management receiving a substantial percentage of their respective
gain opportunity in the form of cash incentive awards, and the executive
officers receiving a substantial portion of their opportunity in the form of
stock options. The basic calculation begins with the individual's base salary
11
<PAGE> 13
and may include the most current annual cash bonus, which is then
multiplied by a factor to determine the size of the incentive award (100%
payout case) and the value of the stock option grant, which is then converted
into shares. For the officers identified in the Summary Compensation Tables
above, the cash incentive awards under the 1984 Plan were based on multiples
ranging from .18 to .29, and the number of shares granted under the 1994 Plan
was based on a multiple ranging from .67 to .88. The comparable multiples
under the proposed 1995 Plan are .13 to .45, and .90 to 1.65, respectively.
In all cases, the multiples were initially determined by an independent
consultant, and confirmed by the Committee. Cash incentive awards are annual
and prior awards are not considered by the Committee when current awards are
made. Likewise, the number of shares that may be granted to each participant
is not otherwise limited and prior grants are not considered by the Committee
when current grants are awarded. 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 five years and was 1/2 of 1% in 1995. 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.
B. CHIEF EXECUTIVE OFFICER COMPENSATION
Thomas L. Reece became Chief Executive Office in May 1994, succeeding Gary
L. Roubos who continues as Chairman. In February 1995, the Committee
determined that given his reduced role in the active management of the
Company, Mr. Roubos would receive no bonus for 1994 but would continue to
receive a salary of $100,000, effective March 1, 1995, and be eligible to
participate in stock option plans and cash performance award programs in the
future. At the same time, the Committee decided that given Mr. Reece's
promotion to the position of Chief Executive Officer in May 1994, a bonus of
$400,000 should be paid to him for 1994 and that his salary be increased to
$650,000 effective January 1, 1995. In addition, the proposed long-term cash
incentive award and stock option grant under the proposed 1995 Plan are based
on multiples of .20 and 1.65, respectively. These determinations were based
upon: (a) outside independent compensation survey data, which places the
compensation for Mr. Reece at the median range of the comparative group; (b)
recommendations made by the Committee's independent compensation consultant
who had been engaged by the Committee during 1994 to review executive short-
and long-term compensation; (c) the 1994 earnings per share increase of 28%;
(d) the general business environment during 1994; and (e) a subjective
judgment factor which is the prerogative of the Committee. Items a, b and c
were given the greatest weight by the Committee.
Compensation Committee: John F. Fort, Chairman
Magalen O. Bryant
David G. Thomas
12
<PAGE> 14
STOCK PERFORMANCE GRAPH
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
DOVER CORPORATION, S&P 500 INDEX & PEER GROUP INDEX
TOTAL SHAREHOLDER RETURNS
200-|-----------------------------------------------------------------------|
| |
| |
190-|-----------------------------------------------------------------------|
| & |
| |
180-|-----------------------------------------------------------------------|
| # |
| |
D 170-|-----------------------------------------------------------------------|
| |
| & |
O 160-|-----------------------------------------------------------------------|
| # |
| @ |
L 150-|----------------------------------------------------@------------------|
| |
| |
L 140-|-----------------------------------------------------------------------|
| @& |
| |
A 130-|-----------------------------------------#-----------------------------|
| @ |
| |
R 120-|--------------------------&--------------------------------------------|
| |
| & |
S 110-|-----------------------------------------------------------------------|
| # |
| |
100-|--@&#------------------------------------------------------------------|
| @ |
| # |
90-|-----------------------------------------------------------------------|
| |
| |
80-|--|------------|-----------|-------------|-----------|-------------|---|
Dec-89 Dec-90 Dec-91 Dec-92 Dec-93 Dec-94
Years Ending
S&P 500 Index = @ Dover Corp. = & Peer Group = #
This graph assumes $100 invested on December 31, 1989 in Dover Corporation
common stock, S&P 500 index and a peer group index. Each mark on the axis
displaying the years 1989 through 1994 represents December 31 of that year.
The peer index 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, Dynamic Materials
Corp., 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, Omni
U.S.A. Inc., Palmer Tube Mills Ltd., Pitt-Des Moines 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.
13
<PAGE> 15
2. PROPOSAL TO RATIFY AND APPROVE 1995 INCENTIVE STOCK OPTION PLAN
AND CASH PERFORMANCE PROGRAM
Dover has had in effect for eleven years the 1984 Plan which expired
January 30, 1995. At the time of its expiration, the Board of Directors
believed that a similar replacement plan should be put into place, and asked
that the Committee review the matter and make recommendations.
As a result of an independent 1994 compensation study, the Committee
concluded that the general design of the 1984 Plan was satisfactory and well
understood. However, there was a recognition that long-term incentives to
encourage real (net of inflation) growth in earnings needed to be enhanced.
As a result, the Committee concluded that the total economic value potential
of both stock option grants and cash performance awards needed to be
increased, particularly for presidents of operating companies. In addition,
the "mix" of incentives needed to be weighted more heavily towards stock
options at higher executive management levels.
Accordingly, in February 1995 the Committee recommended that the Board
approve a new incentive compensation program, the 1995 Plan, which is similar
in design to the 1984 Plan. At the same time, the Committee recommended that
total long-term incentives be increased, particularly at the operating
company presidents' level, and a greater weight be given toward stock options
at the corporate levels. At its meeting in February 1995, the Board of
Directors adopted the new 1995 Plan. The 1995 Plan is subject to ratification
and approval by the stockholders, and no grants will become finalized under
the 1995 Plan unless such ratification and approval are obtained. Assuming
stockholder approval and ratification, the Compensation Committee has
approved grants under the proposed 1995 Plan, which are detailed below. On
March 8, 1995, the closing price of Dover's Common Stock on the New York
Stock Exchange was $ 59.75 a share.
The following plan summary is qualified in its entirety by reference to
the full text of the 1995 Plan, which is attached to the Proxy Statement as
Exhibit A.
GENERAL
Participation in the 1995 Plan will be offered only to a limited group of
salaried officers and other key personnel of Dover and its subsidiaries who
are in a position to affect materially the profitability and growth of Dover
and its subsidiaries and on whom major responsibility rests for the present
and future success of Dover. Directors of Dover who are salaried officers and
other key employees are eligible under the 1995 Plan. The Board believes that
the 1995 Plan will provide these key personnel with a long-range inducement
to remain with Dover and to encourage them to increase their efforts to make
Dover and its subsidiaries successful.
As with the prior 1984 Plan, the new 1995 Plan will be administered by the
Committee, substantially as described in the Committee Report on pages 10-12.
The only substantive difference is that under the 1995 Plan, based on the
1994 compensation report discussed above, the Committee has approved 1995
option grants and cash incentive awards which are generally at higher levels
to consciously increase the incentive for management at all levels to
encourage stronger growth initiatives. At present, there are approximately
250 persons who might be considered by the Committee for grants of and
participations under the 1995 Plan. This number will vary from time to time
during the existence of the 1995 Plan.
STOCK OPTION PLAN
A maximum aggregate of 5,000,000 shares of Common Stock will be reserved
for issue under the 1995 Plan pursuant to grants of options to purchase stock
14
<PAGE> 16
which may be made at any time or from time to time before January 30, 2005
by the Committee (or such other committee of the Board of Directors as the Board
of Directors may designate). This maximum number is subject to adjustments
resulting from stock dividends, stock splits, recapitalizations, reorganizations
and other similar changes.
Options granted under the 1995 Plan may be either options intended to
qualify as incentive stock options ("ISO's") under Section 422 of the Code or
options not intended to so qualify (non-qualified stock options). Options
will have a term not exceeding ten years, will become exercisable after three
years and cannot be granted for more than 150,000 shares annually to a single
recipient. The shares may either be treasury or unissued stock. The option
price for shares covered by any option will be determined by the Committee
but shall in no event be less than the "fair market value" of such shares
(i.e., the mean between the lowest and the highest sales price per share of
common stock on the New York Stock Exchange-Composite Transactions) on the
date the option is granted. The purchase price for the shares upon exercise
of the option may be paid in whole or in part by cash or by transfer to Dover
at the time the option is exercised of shares of its common stock owned by
the option holder in exchange for all or any of the shares being purchased.
The value per share of the shares so transferred to Dover to be credited
toward the purchase price will be the "fair market value" on the date the
option is exercised.
Pursuant to the 1995 Plan, the Committee may elect to present to the Board
of Directors for approval a loan program to encourage earlier option
exercises and greater holding of stock throughout a grantee's employment with
Dover. The Plan indicates that if a loan program were instituted, it would
generally provide for market rate interest, collateralized full recourse
loans in amounts equal to the exercise price plus related taxes (if any)
triggered by such exercise. For further details, see Paragraph 15 of the
Plan.
Generally, stock options are not transferable, except for non-qualified
options which may be transferred to members of the holder's immediate family
(or a trust for the benefit of one or more of such family members), provided
such transfer can only occur once during the option holder's lifetime. In the
event of death or permanent disability, the option holder or his/her estate
shall have five years to exercise options exercisable at the time of death or
permanent disability. In the event of retirement on or after age 65 (or
earlier if approved by the Committee), the option holder has five years to
exercise options which are or may become exercisable within five years of
such retirement. Where the option holder voluntarily or involuntarily
resigns, the holder has three months to exercise options then exercisable,
except where the holder is terminated for cause, in which event the options
terminate immediately with such termination of employment. Where there is a
"change of control" as defined generally above on page 10, all options may
become immediately exercisable.
Subject to stockholder approval of the 1995 Plan, on February 2, 1995, the
Committee has granted stock options with an exercise price of $56.875 per
share, expiring February 2, 2005, to the following individuals and groups:
Gary L. Roubos, 2,354; Thomas L. Reece, 30,397; John B. Apple, 8,985; Lewis
E. Burns, 10,894; Rudolf J. Herrmann, 9,940; John F. McNiff, 11,247; John E.
Pomeroy, 9,542; Jerry W. Yochum, 9,781; all Executive Officers as a Group,
110,409; and all Employees, including Non-Executive Officers, as a Group,
321,901. All these options become exercisable on February 2, 1998.
CASH PERFORMANCE PROGRAM
The 1995 Cash Performance Program is very similar to its predecessor, the
1984 Cash Performance Program, except that the cash award potential is larger
if the long-term growth objectives are achieved. Under the 1995 Plan, the
Committee may grant a participant the opportunity to earn a cash performance
payment conditional upon the attainment, during a performance period of not
less than three years, of objective performance goals designed to reward
long-term growth and return on investment. Performance goals with respect to
15
<PAGE> 17
each performance period are pre-established by the Committee and are based on
one or more of the following factors, as they apply to the Company as a whole,
to an independent subsidiary or to an operating company: earnings per share,
operating earnings, return on equity, and return on investment. No
participant may receive a cash performance payment greater than $2,000,000. A
performance payment is made only upon certification by the Committee that the
applicable performance target has been attained, and no performance payments
will be made unless shareholder approval and ratification of the 1995 Plan
are obtained.
The Committee established under the 1984 Plan that the maximum amount
payable to any individual company, or business unit, could not exceed twenty
percent (20%) of the aggregate real average annual earnings growth
improvement of that unit over a three-year period. The Committee has adopted
the same limitation for proposed awards made in February 1995, which, subject
to stockholder ratification of the 1995 Plan, are summarized on pages 8 and 9
above. The awards, if earned, would be paid in February 1998.
The Committee has the discretion to decrease the amount payable upon the
attainment of a performance goal to take into account the effect of any
unusual, non-recurring circumstance, but has the discretion to increase the
amount payable to take into account such effect only if such discretion would
not adversely affect the compensation's status as "qualified
performance-based compensation" for purposes of Section 162(m) of the Code.
In the event of a participant's normal retirement on or after age 65 (or
at an earlier retirement date approved by the Committee) before performance
payment is made, the participant will receive the full performance payment as
if he/she has not retired. In the event of a participant's death, permanent
disability, or approved termination of employment before the date of payment
of an award, or in the event a participant otherwise ceases to be an employee
(other than for cause) after the performance period but before the payment
date, the participant will receive a prorated payment based on the number of
months the performance period during which he/she was employed. The
termination of a participant's employment under any other circumstances will
cancel his/her right to receive a cash performance payment.
FEDERAL INCOME TAX CONSEQUENCES
The grant of a stock option will not result in income tax consequences at
the time of grant for the optionee or the Company. The grantee will have no
taxable income upon exercising an ISO, although the alternative minimum tax
may apply, and the Company will receive no deduction when an ISO is
exercised. Upon exercising a non-qualified stock option, the grantee will
recognize ordinary income in the amount by which the fair market value
exceeds the option price; the Company will be entitled to a deduction against
its taxable income for the same amount. The treatment to a grantee of a
disposition of shares acquired through the exercise of an option is dependent
upon the length of time the shares have been held and on whether such shares
were acquired by exercising an ISO or a non-qualified stock option.
Generally, there will be no tax consequence to the Company in connection with
the disposition of shares acquired under an option except that the Company
may be entitled to a deduction in the case of a disposition of shares
acquired upon exercise of an ISO before the applicable ISO holding periods
have been satisfied. In the event a grantee's employment terminates by reason
of retirement or permanent disability, any ISO's held by the grantee will
generally be treated as non-qualified stock options if exercised more than
three months (one year in the case of disability) following such termination
of employment.
The initial grant of a participation in the Cash Performance Program
consisting of contingent future rights to cash after the completion of the
performance measurement period will not result in taxable income to the
individual at the time of the initial grant. At the time Dover pays a cash
award, the amount of the cash will constitute compensation taxable to the
individual as ordinary income, and Dover will be entitled to a deduction in
computing its Federal income taxes for the year taxable to the individual.
16
<PAGE> 18
OTHER INFORMATION
The Board may amend the 1995 Plan as it deems advisable, except that
stockholder approval is required for any amendment that would otherwise cause
the 1995 Plan not to comply with Rule 16b-3 under the Exchange Act. The
Committee may amend outstanding grants consistent with the 1995 Plan if the
amendment does not impair the grantee's rights or upon the agreement of the
grantee.
In the event of a "change of control", in order to preserve all of the
grantee's rights the following shall occur, the Committee may provide in the
grant or award agreement that: (i) any outstanding stock options not already
exercisable shall become immediately exercisable; (ii) outstanding
performance awards shall be vested and paid out on a prorated basis, based on
the maximum award opportunity and the number of months elapsed compared to
the total number of months in the award period; and (iii) in the event of
termination of employment of a grantee of a stock option within two years
after the Change of Control, the option will remain exercisable for three
months after such termination, provided that no option may be extended beyond
a 10-year total term.
RECOMMENDATION
The Board of Directors recommends ratification and approval of the 1995
Plan by the stockholders. The proxies will vote for or against the 1995 Plan
as specified by the stockholder in his Proxy but, unless otherwise
instructed, they will vote to ratify and approve the 1995 Plan. To be
effective, the 1995 Plan must be approved by a majority of the total number
of outstanding shares of stock present in person or by proxy and entitled to
vote at the meeting.
3. PROPOSAL TO RATIFY AND APPROVE A LOAN PROVISION
AMENDMENT TO THE 1984 INCENTIVE STOCK OPTION PLAN
Consistent with the proposed 1995 Plan, the Committee and the Board have
approved an amendment to the 1984 Plan which is designed to allow the
possibility of loans to facilitate employees exercising stock options already
granted under that Plan. While no such loan program is currently offered, the
Committee believes that having such a loan program in the future could
encourage the earlier exercise of options and hence increase the stock
ownership of executives and other key managers, which is consistent with the
purposes of the 1984 Plan, and its successor, the 1995 Plan.
RECOMMENDATION
The Board of Directors recommends approval of the loan provision amendment
to the 1984 Plan by the stockholders. The proxies will vote for or against
the amendment as specified by the stockholder in his Proxy but, unless
otherwise instructed, they will vote to ratify and approve the amendment. To
be effective, the amendment to the 1984 Plan must be approved by a majority
of the total number of outstanding shares of stock present in person or by
proxy and entitled to vote at the Meeting.
4. 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 judgment on such
matters.
17
<PAGE> 19
STOCKHOLDER PROPOSALS FOR 1996 ANNUAL MEETING
Stockholder proposals properly included in Dover's proxy statement must be
received by Dover at its principal executive offices, 280 Park Avenue, New
York, NY 10017 by November 15, 1995. 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 Meeting, which is scheduled for
April 30, 1996.
Dated: March 15, 1995
By authority of the Board of Directors,
ROBERT G. KUHBACH
Secretary
18
<PAGE> 20
EXHIBIT A
DOVER CORPORATION
1995 INCENTIVE STOCK OPTION PLAN
AND
1995 CASH PERFORMANCE PROGRAM
A. PURPOSE AND SCOPE OF
PLAN AND PROGRAM
1. Purpose. The 1995 Incentive Stock Option Plan (the "Plan") and 1995
Cash Performance Program (the "Program") are intended to promote the
long-term success of Dover Corporation by providing salaried officers and
other key employees of Dover Corporation and its subsidiaries, on whom major
responsibility for the present and future success of Dover Corporation rests,
with a long-range inducement to remain with the organization and to encourage
them to increase their efforts to make the Dover Corporation successful. The
term "Corporation" shall mean Dover Corporation and any present or future
corporation which is or would be a "subsidiary corporation" of Dover
Corporation as defined in Section 424 of the Internal Revenue Code of 1986,
as amended (the "Code"), unless the context requires otherwise.
2. Successor Plan and Program. The Plan and the Program are successors to
the 1984 Incentive Stock Option Plan and Cash Performance Program
(hereinafter the "Predecessor Plans"). No further grants of options or
incentive awards may be made under the Predecessor Plans. Options and
incentive awards under the Predecessor Plans shall be administered pursuant
to the provisions of those respective Plans.
3. Administration. The Plan and the Program shall be administered and
interpreted by the Compensation Committee (or such other Committee of the
Board of Directors as the Board may designate if there is no Compensation
Committee; hereinafter the "Committee"), consisting of not less than three
persons appointed by the Board of Directors of the Corporation from among its
members. A person may serve as a Committee member provided he or she shall
comply in all respects with any qualifications required by law, including
specifically being a "disinterested person" for purposes of the rules
promulgated under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and an "outside director" for purposes of Section 162(m) of
the Code. The Committee will have sole and complete authority to administer
all aspects of the Plan and the Program, including but not limited to: (a)
determining the individuals eligible to receive options under the Plan and/or
to participate in the Program; (b) granting options and participations; (c)
determining the number of options and the amount of participations to be
granted to any such eligible individuals at any time or from time to time;
(d) determining the terms and conditions under which grants and
participations will be made; and (e) determining whether objectives and
conditions for performance bonuses have been met. The Committee may, subject
to the provisions of the Plan and Program, from time to time establish such
rules and regulations as it deems appropriate for the proper administration
of the Plan and the Program. The Committee's decisions shall be final,
conclusive and binding with respect to the interpretation and administration
of the Plan and the Program and any grants or awards made thereunder.
4. Eligibility. Grants may be made to any employee of the Corporation who
is a salaried officer or other key employee, including salaried members of
the Board of Directors (hereinafter sometimes referred to as "participants").
The Committee shall select the participants eligible and determine the terms
of the grants and participations to each.
A-1
<PAGE> 21
B. THE STOCK OPTION PLAN
5. Shares Available for Grant. 5,000,000 shares of Common Stock of Dover
Corporation (the "Common Stock") will be reserved for issuance upon exercise
of options to purchase Common Stock granted under the Plan, which options may
be granted at any time prior to January 30, 2005. These maximum numbers are
subject to appropriate adjustment resulting from future stock splits, stock
dividends, recapitalizations, reorganizations and other similar changes to be
computed in the same manner as that provided for in Paragraph 14 below. If
any option granted under the Plan expires, terminates or is canceled for any
reason without having been exercised in full, the number of unpurchased
shares under such option will again be available for the purpose of the Plan.
6. Stock Options. Options granted under the terms of this Plan shall be
designated as either "non-qualified" stock options or "incentive" stock
options within the meaning of Section 422 of the Code, and shall contain such
terms and conditions as the Committee may from time to time determine,
subject to the following limitations:
(a) Option Price. The option price for shares covered by any option
will be determined by the Committee, but shall in no event be less than
the fair market value of such shares on the date the option is granted.
The fair market value will be construed to be the average of the high and
low sales price of the Common Stock on the New York Stock Exchange (the
"Exchange") on the date the option is granted by the Committee or, if no
sales have occurred on that date, such value will be the closing price on
the Exchange on the trading day next preceding the granting of the option.
(b) Option Exercise Period. The term of each option will be for such
period as the Committee may determine, but in no event may an option be
exercised more than 10 years following the granting thereof.
(c) Rights of Option Holder. A recipient of stock options shall have no
rights as a stockholder with respect to any shares issuable or
transferable upon exercise thereof until the date of issuance of a stock
certificate for such shares. Except as specifically set forth in Paragraph
14 below, no adjustment shall be made for dividends or other distributions
of cash or other property on or with respect to shares of stock covered by
these options paid or payable to holders of record prior to such issuance.
(d) Limits on Individuals. Options on a maximum number of 150,000
shares may be granted each year to a single participant. The aggregate
fair market value (determined on the date of grant) of Common Stock with
respect to which a participant is granted incentive stock options
(including incentive stock options granted under any Predecessor Plan)
which first become exercisable during any given calendar year shall not
exceed $100,000.
7. Exercise of Option. Stock options may be exercised at such time or
times and subject to such terms and conditions as the Committee shall
determine and are specified in the options instrument, not inconsistent with
the terms of the Plan; provided, however, that except as set forth in
Paragraphs 11 and 14, no option may be exercised prior to the third
anniversary of such Option grant and any partial exercise of an option shall
be for not less than 500 shares. To exercise an option, the option holder
must give written notice to the Corporation of the number of shares to be
purchased accompanied by payment of the full purchase price of such shares as
set forth in Paragraph 8. The date of actual receipt by the Corporation of
such notice and payment shall be deemed the date of exercise of the option
with respect to the shares being purchased and the stock certificates
therefor shall be issued as soon as practicable thereafter. The shares to be
issued upon exercise of an option will be either treasury or authorized and
unissued stock, in the sole discretion of the Corporation.
A-2
<PAGE> 22
8. Payment. Payment of the option exercise price must be made in full at
the time of exercise (a) by check made payable to the Corporation, (b) if
available, through the Loan Program (as hereinafter described), (c) by
transfer to the Corporation of shares of Common Stock owned by the
participant or (d) with a combination of the foregoing. If payment is made by
the transfer of shares, the value per share of the shares so transferred to
the Corporation to be credited toward the purchase price will be the average
between the high and the low sales price per share of Common Stock on the
Exchange on the date the option is exercised or, if no sales have occurred on
that date, such value will be the closing price per share on the Exchange on
the trading day next preceding the exercise of the option. The shares
transferred to Dover will be added to the Corporation's treasury shares or
canceled and become authorized and unissued shares.
9. Option Transfers. The options granted under this Plan may not be sold,
transferred, hypothecated, pledged or otherwise disposed of by any of the
holders except by will or by the laws of descent and distribution, or as
otherwise provided herein. The option of any person to acquire stock and all
rights thereunder shall terminate immediately if the holder attempts to or
does sell, assign, transfer, pledge, hypothecate or otherwise dispose of the
option or any rights thereunder to any other person except as permitted
herein. Notwithstanding the foregoing, a participant may transfer any
non-qualified option granted under this Plan to members of the holder's
immediate family (defined as a spouse, children and/or grandchildren), or to
one or more trusts for the benefit of such family members if the instrument
evidencing such option expressly so provides and the option holder does not
receive any consideration for the transfer; provided that any such
transferred option shall continue to be subject to the same terms and
conditions that were applicable to such option immediately prior to its
transfer (except that such transferred option shall not be further
transferred by the transferee during the transferee's lifetime).
10. Registration. The Corporation will stamp stock certificates delivered
to the stockholder with an appropriate legend if the shares are not
registered under the Securities Act of 1933, as amended (the "Act"), or are
otherwise not free to be transferred by the holder and will issue appropriate
stop-order instructions to the transfer agent for the Common Stock, if and to
the extent such stamping or instructions may then be required by the Act or
by any rule or regulation of the Securities and Exchange Commission issued
pursuant to the Act.
11. Effect of Death, or Permanent Disability or Retirement. If an option
holder dies or becomes permanently disabled while employed by the
Corporation, the option holder or such holder's estate or the legatees or
distributees of such holder's estate or of the option, as the case may be,
shall have the right, on or before the earlier of the expiration date of the
option or sixty (60) months following the date of such death or permanent
disability, to purchase under the option the number of shares, if any, which
the option holder was entitled to purchase as of such date of death or
permanent disability. If an option holder retires at or after age 65 (or at
an earlier retirement date approved by the Committee), the option holder
shall have the right, on or before the earlier of the expiration date of the
option or sixty (60) months following the date of such retirement, to
purchase shares under any options which at retirement are, or within sixty
(60) months following retirement would become, exercisable.
12. Voluntary or Involuntary Termination. If any option holder's
employment with the Corporation is voluntarily or involuntarily terminated
for any reason, other than for reasons specified above or for "cause" (as
defined below), the option holder shall have the right to purchase under the
option the number of shares, if any, which such holder was entitled to
purchase at the time of such termination at any time on or before the earlier
of three (3) months following the effective date of such termination of
employment or the expiration date of the option.
13. Termination for Cause. If an option holder's employment with the
Corporation is terminated for cause (defined as (a) a felony conviction of
the option holder; (b) the commission by the option holder of an act of
A-3
<PAGE> 23
fraud or embezzlement against the Corporation; or (c) the option holder's
willful misconduct or gross negligence materially detrimental to the
Corporation ), the option shall be canceled and the holder shall have no
further rights to exercise any such option and all of such holder's rights
thereunder shall terminate as of the effective date of termination of
employment.
14. Effect of Stock Dividends, Merger, Recapitalization or
Reorganization. If any Common Stock dividend is paid by the Corporation, if
any non-cash distribution if made by the Corporation as respects its Common
Stock, if the shares of Common Stock are split or reclassified, if the
Corporation should be reorganized or consolidated or merged with or into
another corporation, or if all or substantially all the assets of the
Corporation are transferred to any other corporation in a reorganization,
each option holder shall be entitled, upon exercise of such holder's option,
to receive for the same aggregate exercise price the same number and kind of
shares of stock (to the nearest whole number) as he would have been entitled
to receive upon the happening of such stock dividend, distribution, stock
split, reclassification, reorganization, consolidation, merger or transfer,
if he had been, immediately prior to such event, the holder of such shares.
Outstanding options shall be appropriately amended as to price and other
terms in a manner consistent with the aforementioned adjustment to the shares
of Common Stock subject to the Plan. The Board of Directors shall have the
power, in the event of any disposition of substantially all of the assets of
the Corporation, its dissolution, any merger or consolidation, or the merger
or consolidation of any other corporation into the Corporation, to amend all
outstanding options to permit their exercise prior to the effectiveness of
any such transaction and to terminate such options as of such effectiveness.
If the Board of Directors shall exercise such power, all options outstanding
shall be deemed to have been amended to permit the exercise thereof in whole
or in part by the holder at any time or from time to time as determined by
the Board of Directors prior to the effectiveness of such transaction and
such options shall be deemed to terminate upon such effectiveness.
15. Loan Program. Except in unusual circumstances, it is the Corporation's
expectation that shares acquired through the exercise of options are to be
held by participants for the duration of their employment with the
Corporation. In order to help participants finance the exercise of their
options and resulting income taxes, if any, the Corporation may provide for
loans to Plan participants at any time and from time to time after May 1,
1995. If established by the Board, any loan program will be administered by
the Committee and may apply to all existing unexercised options, with the
exception of incentive options, and/or all future option grants, as the
Committee shall decide. The terms of any loans shall be specified by the
Committee, as they may deem appropriate, provided that the following terms
shall apply:
(a) The maximum amount of any loan cannot be greater than the option
exercise price of the acquired stock, together with the amount of any
taxes due as a result of such exercise, and in any event cannot exceed the
fair market value of the acquired stock. In the event the participant
chooses to satisfy all or a portion of the option exercise price by
surrender, at fair market value, of other Common Stock already owned by
the participant, the maximum amount of the loan will be reduced by the
value of the stock surrendered.
(b) Loans will be evidenced by promissory notes having a term of not
more than ten (10) years, which notes shall be subject to further
extension for additional periods of time not exceeding ten (10) years at
each such extension. Prepayment of loan principal may not be required
during the participant's employment with the Corporation and/or
subsidiaries. Repayment in full must be made within one (1) month of
termination of employment; however, this period is extended to six (6)
months if employment ceases due to death, permanent disability or
retirement. Loan prepayment may be made by the participant at the
participant's discretion but, once reduced, the loan may not be
subsequently increased.
A-4
<PAGE> 24
(c) The Corporation shall have the right to hold as collateral all
stock acquired under a particular option instrument, regardless of the
amount of the loan, until the loan is fully repaid. Such stock will be
registered in the participant's name (or such other name as the Plan
permits) so that the participant may vote the stock and receive the
dividends applicable thereto, provided the loan is current.
(d) The participant will be responsible for the full repayment of the
loan, regardless of the value of the stock. However, no additional
collateral for the loan will be required regardless of the fair market
value of the stock.
(e) Interest on the loan balance will be due quarterly, in arrears, and
will be at a sufficient rate so as not to result in any imputed income to
the participant under the terms of the Code.
16. Change of Control. The terms of an option may provide for the
acceleration of the option's exercisability in the event of a change of
control (as defined in Paragraph 27 below) of the Corporation.
C. CASH PERFORMANCE PROGRAM
17. Awards and Period of Contingency. The Committee may, concurrently
with, or independently of, the granting of an option under the Plan, in its
sole discretion, grant to a participant the opportunity to earn a cash
performance payment, conditional upon the attainment of an objective
performance goal during a performance period. The performance period shall be
not less than three fiscal years of the Corporation, including the year in
which the conditional grant is made. Any performance goal established by the
Committee shall include an objective formula or standard for determining the
amount of the performance payment payable to a participant if the goal is
attained. The performance goal may be fixed by the Committee for the
Corporation as a whole or for a subsidiary or division of the Corporation,
depending on the Committee's judgment as to what is most appropriate for the
individual involved, and shall be set by the Committee before the 90th day
after the commencement of the period of services to which the performance
payment relates. Performance goals shall be based on at least one or more of
the following factors which the Committee deems appropriate, as they apply to
the Corporation as a whole or to a subsidiary or a division: (a) earnings per
share, (b) operating earnings, (c) return on equity and (d) return on
investment. The performance goal with respect to a performance period will be
the same for all persons within the same business unit. The material terms of
the performance goals shall be subject to stockholder approval to the extent
provided in regulations promulgated under Section 162(m) of the Code.
18. Determination of Payment Amount. The aggregate maximum cash payout for
any business unit within the Corporation or the Corporation as a whole shall
not exceed a fixed percentage of the annual average earnings increase of the
relevant entity during the performance period. such percentages and dollar
amounts to be determined by the Committee annually when performance goals are
established. In no event can an individual receive an annual payment which
exceeds $2 million. A performance payment shall be payable with respect to a
performance period only if the Committee shall have certified that the
applicable performance target has been attained. The Committee shall also
have the power to approve proportional or adjusted payments under the Program
to address situations where participants join the Corporation, or transfer
within the Corporation, during a performance period. The Committee shall have
the discretion to decrease the amount payable upon attainment of the
performance goal (as determined under such formula or standard) to take into
account the effect of any unusual, non-recurring circumstance, but shall have
the discretion to increase the amount payable to take into account any such
effect only if such discretion would not cause such compensation to fail to
qualify as "qualified performance-based compensation" for purposes of Section
162(m) of the Code.
A-5
<PAGE> 25
19. Effect of Death, Disability or Other Early Termination of
Employment. If the participant in the Program (a) dies, becomes permanently
disabled while employed by the Corporation or terminates employment for any
reason designated by the Compensation Committee as an "approved termination"
(other than related to retirement), in each case before the date of payment
or distribution of any final award, or (b) otherwise ceases to be an
employee, whether voluntarily or involuntarily, after the performance
measurement period and before the payment date for any reason other than
termination by the employer for cause, the participant (or the participant's
estate or the legatees or distributees of the participant's estate, as the
case may be), shall be entitled to receive on the payment date the cash
payment which the participant would have earned had he then been an employee
of the Corporation multiplied by a fraction, the numerator of which is the
number of months the participant was employed by the Corporation during the
performance measurement period and the denominator of which is the number of
months of the performance measurement period (treating fractional months as
whole months in each case).
20 Effect of Normal Retirement. If before the date of payment, the
participant retires on or after age 65 years (or at an earlier retirement
date approved by the Committee), the participant shall be entitled to receive
on the payment date the same amount of cash which the participant would have
earned had such participant then been an employee of the Corporation as of
such date.
21. Effect of Other Termination. If the participant's employment with the
Corporation is terminated for any reason during or after the performance
period and before the payment date other than as set forth in the preceding
two paragraphs, whether such termination be voluntary or involuntary, such
participation shall be canceled and all of the participant's rights under the
grant shall terminate as of the effective date of termination of such
employment.
22. Change of Control. The terms of a performance goal may include
modified rules applicable in the event of a change of control (as defined in
Paragraph 27 below) of the Corporation, including provisions relating to the
calculation of the bonus amount, the early termination of the performance
period, and the date through which a participant must continue to be employed
to be eligible to receive cash payment of such award.
D. GENERAL PROVISIONS
23. Legal Compliance. It is the intent of the Corporation that the Plan
comply in all respects with applicable provisions of the Exchange Act,
including Section 16 and Rule 16b-3, so that any grant of options to, or
other transaction by, a participant who is subject to the reporting
requirements of Section 16(a) of the Exchange Act shall not result in
short-swing profits liability under Section 16(b) (except for any transaction
exempted under alternative Exchange Act rules or intended by such participant
to be a non-exempt transaction). It is also the intent of the Corporation
that any compensation income realized in connection with options and any
perform- ance payments made under the Plan and Program constitute
"performance-based compensation" within the meaning of Section 162(m)(4)(C)
of the Code so that any deduction to which the Corporation is entitled in
connection with such compensation will not be subject to the limitations of
Section 162(m)(1) of the Code. Accordingly, if any provision of this Plan or
Program or any agreement relating to an option or participation does not
comply with such requirements of Rule 16b-3 as then applicable to any such
transaction so that such a participant would be subject to Section 16(b)
liability (except for any transaction exempted under alternative Exchange Act
rules or intended by such participant to be a non-exempt transaction), or if
any provision of this Plan or Program or any agreement relating to an option
or participation would limit, under Section 162(m)(1) of the Code, the amount
of compensation income to an optionee or participant that the Corporation
would otherwise be entitled to deduct, such provision shall be construed or
deemed amended to the extent necessary to conform to such requirements, or to
eliminate such deductibility limitation, and the participant shall be deemed
to have consented to such construction or amendment.
A-6
<PAGE> 26
24. Withholding Taxes. The Committee shall make arrangements for the
collection of any Federal, State or local taxes of any kind required to be
withheld with respect to any transactions effected under the Plan or the
Program. The obligations of the Corporation under the Plan and the Program
shall be conditional on satisfaction of such obligations and the Corporation,
to the extent permitted by law, shall have the right to deduct any such taxes
from any payment of any kind otherwise due to a participant.
25. Effect of Recapitalization or Reorganization. The obligations of the
Corporation with respect to an option granted under the Plan or a
participation under the Program shall be binding upon the Corporation, its
successors or assigns, including any successor or resulting company either in
liquidation or merger of the Corporation into another company owning all the
outstanding voting stock of the Corporation or in any other transaction
whether by merger, consolidation or otherwise under which such succeeding or
resulting company acquires all or substantially all the assets of the
Corporation and assumes all or substantially all its obligations unless
options are terminated in accordance with Paragraph 14.
26. Employment Rights and Obligations. The granting of any option under
the Plan or participation under the Program shall not alter or otherwise
affect the rights of the Corporation to change any and all the terms and
conditions of employment of any participant including, but not limited to,
the right to terminate such participant's employment.
27. Change of Control.
(a) For purposes of the Plan, a "change of control" shall be deemed to
have taken place upon the occurrence of any of the following events:
(i) any person is, becomes, or has the right to become the
beneficial owner, directly or indirectly, of securities of the
Corporation representing 20% or more of the shares of Common Stock of
the Corporation then outstanding, whether or not such person continues
to be the beneficial owner of securities representing 20% or more of
the outstanding shares of Common Stock; or
(ii) as the result of, or in connection with, any tender or
exchange offer, merger or other business combination, sale of assets or
contested election, any announcement of an intention to make any of the
foregoing transactions, or any combination of the foregoing
transactions (a "Transaction"), those persons who were directors of the
Corporation before the Transaction and were otherwise unaffiliated with
any other party to the Transaction shall cease to constitute a majority
of the Board of Directors of the Corporation or any successor to the
Corporation (a "Change in the Board"); or
(iii) the stockholders of the Corporation approve any merger,
consolidation, reorganization, liquidation, dissolution, or sale of all
or substantially all of the Corporation's assets in which neither the
Corporation nor a successor resulting from a change in domicile or form
of organization will survive as an independent, publicly owned
corporation.
(b) Notwithstanding anything in the preceding subparagraph (a) to the
contrary, no change of control shall be deemed to have occurred by virtue
of any event which results in any of the following:
(i) the acquisition, directly or indirectly, of 20% or more of the
outstanding shares of Common Stock of the Corporation by (A) the
executive or a person including the executive, (B) the Corporation, (C)
a Subsidiary, or (D) any employee benefit plan of the Corporation or of
a Subsidiary, or any entity holding securities of the Corporation
recognized, appointed, or established by the Corporation or by a
Subsidiary for or pursuant to the terms of such plan; or
(ii) a Change in the Board resulting from any Transaction in which
the executive or a person including the executive participates directly
or indirectly with any party to the Transaction other than the
Corporation.
A-7
<PAGE> 27
28. Interpretation. The Committee shall have the sole and complete
authority and discretion to decide any questions concerning the application,
interpretation or scope of any of the terms and conditions of the Plan and
the Program, of any stock option agreement or loan entered into pursuant to
the Plan, or of any participation under the Program, and its decisions shall
be binding and conclusive upon all interested parties.
29. Amendment. Except as expressly provided in the next sentence, the
Board of Directors may amend the Plan or Program in any manner it deems
necessary or appropriate (including any of the terms, conditions or
definitions contained herein), or terminate the Plan and/or Program at any
time prior to January 30, 2005; provided, however, that any such termination
will not affect the validity of any then outstanding options previously
granted under the Plan or outstanding participations under the Program, as
the case may be. Without the approval of the Corporation's stockholders, the
Board cannot: (a) increase the maximum number of shares covered by the Plan
or change the class of employees eligible to receive options; (b) reduce the
option price below the fair market value of the Common Stock on the date of
the option grant; or (c) extend beyond 120 months from the date of the grant
the period within which an option may be exercised.
30. Effectiveness, and Termination of Plan. The Plan and the Program will
become effective on the date of their adoption by the Board of Directors,
subject to ratification of the adoption of the Plan and the Program by
affirmative vote of holders of a majority of the issued and outstanding
shares of Common Stock. The Plan and Program will both terminate on January
30, 2005 and no option grant or participation grant, as the case may be, may
be made on or after such date .
31. Foreign Jurisdictions. The Committee may adopt, amend, and terminate
such arrangements, not inconsistent with the intent of the Plan and the
Program, as it may deem necessary or desirable to make available tax or other
benefits of the laws of foreign jurisdictions to participants who are subject
to such laws.
32. Governing Law. The Plan, the Program and all grants, options, awards
and payments made hereunder shall be governed by and interpreted in
accordance with the internal laws of the State of New York, without regard to
conflicts of law principles.
A-8
<PAGE> 28
PROXY PROXY
DOVER CORPORATION
PROXY SOLICITED BY BOARD OF DIRECTORS FOR ANNUAL MEETING, APRIL 25, 1995.
The undersigned hereby appoints Gary L. Roubos,
Thomas L. Reece and Robert G. Kuhbach, or any of
them, as the undersigned's 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
Wilmington, Delaware, on April 25, 1995 at 10:00
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.
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 AND FOR ITEMS 2 AND 3
LISTED ON THE REVERSE SIDE.
<PAGE> 29
PROXY DOVER CORPORATION PROXY
For All
(Except Nominee(s)
1995 1. Election of Directors-- For Withhold written below)
P Nominees: D.H. Benson,
R M.O. Bryant, J-P. M.
O Ergas, R.J. Fleming,
X J.F. Fort, J.L. Koley,
Y A.J. Ormsby, T.L. Reece,
G.L. Roubos, D.G. Thomas
and J.W. Yochum.
For Against Abstain
2. To rafity and approve the 1995
Incentive Stock Option and 1995
Cash Performance Program.
For Against Abstain
3. To ratify and approve an amendment
to the 1984 Incentive Stock Option
Plan to allow for possible loans
under that Plan.
4. To transact such other business as For Against Abstain
may properly come before the meeting.
------------------------------------
The Board of Directors recommends a
Vote FOR Items 1, 2 and 3.
Date 1995
-------------------------
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.
