<PAGE> 1
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
[AMENDMENT NO. ............................]
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, For Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / SOLICITING MATERIAL PURSUANT TO SECTION 240.14A-11(C) OR
SECTION 240.14A-12
DOVER CORPORATION
______________________________________________________________________________
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
______________________________________________________________________________
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE
REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
/X/ No Fee Required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
______________________________________________________________________
2) Aggregate number of securities to which transaction applies:
______________________________________________________________________
3) Per unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
______________________________________________________________________
4) Proposed maximum aggregate value of transaction:
______________________________________________________________________
5) Total fee paid:
______________________________________________________________________
/ / Fee paid previously with preliminary materials:
/ / CHECK BOX IF ANY PART OF THE FEE IS OFFSET AS PROVIDED BY
EXCHANGE ACT RULE 0-11(A)(2) AND IDENTIFY THE FILING FOR WHICH THE
OFFSETTING FEE WAS PAID PREVIOUSLY. IDENTIFY THE PREVIOUS FILING BY
REGISTRATION STATEMENT NUMBER, OR THE FORM OR SCHEDULE AND THE DATE
OF ITS FILING.
1) Amount Previously Paid:_______________________________________________
2) Form, Schedule or Registration Statement No.:__________________________
3) Filing Party:_________________________________________________________
4) Date Filed:___________________________________________________________
<PAGE> 2
[DOVER CORPORATION LOGO]
------------------------------
Notice Of Annual Meeting Of Stockholders
------------------------------
March 17, 2000
TO THE STOCKHOLDERS:
Please take notice that the Annual Meeting of Stockholders of DOVER
CORPORATION will be held at the Lobby Conference Room, Wilmington Trust Company,
1100 North Market Street, Rodney Square North, Wilmington, Delaware 19801, on
April 25, 2000, at 10:00 A.M., for the following purposes:
1. To elect nine directors;
2. To re-approve the performance goals for the Company's 1995 Cash
Performance Program;
3. 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 29, 2000 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
THIS YEAR DOVER IS PLEASED TO OFFER ITS SHAREHOLDERS THE CHOICE OF VOTING
THEIR SHARES BY RETURNING THE ENCLOSED PROXY BY MAIL OR VIA A TOLL-FREE
TELEPHONE NUMBER. INSTRUCTIONS FOR VOTING BY THESE TWO ALTERNATIVES ARE PRINTED
ON THE ENCLOSED PROXY CARD.
<PAGE> 3
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, 2000 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 $12,000. This statement and the proxy form
are being first sent to the stockholders on or about March 17, 2000.
As of the close of business on February 29, 2000, the record date for
determining stockholders eligible to vote at the Meeting, Dover had outstanding
202,911,837 shares of common stock. Each share of common stock is entitled to
one vote on all matters.
DOVER WILL PROVIDE TO EACH PERSON SOLICITED HEREIN, ON THE WRITTEN REQUEST
OF ANY SUCH PERSON, A COPY OF DOVER'S 1999 ANNUAL REPORT ON FORM 10-K INCLUDING
THE FINANCIAL SCHEDULES THERETO, FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION, ALL WITHOUT CHARGE (EXCEPT THAT THE COMPANY MAY CHARGE FOR ANY
EXHIBIT). A REQUEST FOR THE FORM 10-K 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 nine
nominees for director or their substitutes as indicated below unless directed
otherwise in the proxy in which case the shares will be voted as directed. The
proxy also grants discretionary authority to the persons named as proxies in
connection with other matters that may properly come before the Meeting to the
full extent allowed by the rules under the Securities Exchange Act of 1934, as
amended.
Abstentions and 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
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 by mail or by telephone 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
the cancellation of the proxy.
1
<PAGE> 4
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Set forth below is the ownership, as of February 29, 2000 (except as
otherwise stated), of the number of shares and percentage of Company common
stock beneficially owned by: (i) each Director and nominee for Director, (ii)
each executive officer listed in the compensation table, (iii) all Directors,
nominees and executive officers of Dover as a group and (iv) all persons or
entities beneficially owning more than 5% of the outstanding Company common
stock; each such entity reported beneficial ownership only of the shares held in
accounts for which it was investment manager or investment advisor and
disclaimed being part of a group for all purposes other than Securities and
Exchange Commission reporting purposes.
<TABLE>
<CAPTION>
NUMBER OF SHARES(1) PERCENTAGE
------------------- ----------
<S> <C> <C>
David H. Benson........................................ 10,800(2) *
Lewis E. Burns......................................... 465,560 *
Jean-Pierre M. Ergas................................... 26,800 *
Roderick J. Fleming.................................... 8,800 *
Kristiane C. Graham.................................... 1,704,332(3) *
Rudolf J. Herrmann..................................... 165,862 *
James L. Koley......................................... 28,600(4) *
Richard K. Lochridge................................... 4,050 *
John F. McNiff......................................... 414,821(5) *
John E. Pomeroy........................................ 294,179 *
Thomas L. Reece........................................ 676,598(6) *
Gary L. Roubos......................................... 481,611(7) *
Michael B. Stubbs...................................... 323,338(8) *
Jerry W. Yochum........................................ 151,985 *
Directors and Executive Officers as a Group............ 5,149,818 2.5%
Capital Group International, Inc....................... 13,980,790(9) 6.9%
1110 Santa Monica Boulevard
Los Angeles, CA 90025
</TABLE>
- ---------------
* Less than one percent.
(1) Includes shares which are (a) owned by officers in the Company's Retirement
Savings Plan, totaling 152,927 shares, as of December 31, 1999 and (b)
subject to options exercisable within 60 days for the following person(s):
Mr. Burns, 189,286 shares; Mr. Herrmann, 118,376 shares; Mr. Pomeroy,
187,076 shares; Mr. Reece, 368,112 shares; Mr. Roubos, 21,610 shares; Mr.
Yochum, 117,492 shares; and all directors and officers as a group, 1,404,468
shares.
(2) Includes 1,000 shares held by his spouse.
(3) Includes 1,287,968 shares held by a charitable foundation of which Ms.
Graham is a director, 550 shares owned by her spouse as to all of which
shares she disclaims beneficial ownership, and 92,208 shares held by trusts
of which she is co-trustee. Excludes 304,960 shares held by a corporation of
which Ms. Graham is a director.
(4) Includes 1,000 shares held by his spouse, 1,200 shares held in various
retirement trusts for Mr. Koley and his spouse, and 4,000 shares held by a
retirement plan as to which Mr. Koley is a co-trustee and beneficiary.
(5) Includes 10,000 shares held by his spouse and 1,200 shares held as custodian
for his minor child.
(6) Includes 75,410 shares held by his spouse.
(7) Includes 125,848 shares held by his spouse and 63,497 shares held by a
limited liability company as to which he disclaims any beneficial interest.
2
<PAGE> 5
(8) Includes 500 shares held by his spouse as to which Mr. Stubbs disclaims
beneficial ownership, 17,500 shares held by a family trust, and 183,132
shares held by trusts of which Mr. Stubbs is a co-trustee and various
members of his immediate family are beneficiaries. Excludes 2,378,228 shares
held by trusts of which Mr. Stubbs or members of his immediate family are
beneficiaries.
(9) Capital Group International Inc. is the parent holding company of Capital
Guardian Trust Company, Capital International Limited, Capital International
SA and Capital International Research and Management, Inc., each of which
beneficially owns some of these shares of Dover common stock as investment
manager or investment advisor to its various clients.
1. ELECTION OF DIRECTORS
The persons named as proxies will vote the shares covered by a proxy for
the election as directors of the nine 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 are presently
directors. Each director elected at the Meeting will serve until the election
and qualification of his or her successor.
Directors will be elected by a plurality of the votes cast. Votes may be
cast only for the nominees listed below. The accompanying proxy will be voted
for the nominees in the absence of instructions to the contrary.
<TABLE>
<CAPTION>
YEAR FIRST
BUSINESS EXPERIENCE FOR PAST FIVE YEARS, BECAME
NAME AND AGE POSITIONS WITH DOVER, AND OTHER DIRECTORSHIPS DIRECTOR
------------ --------------------------------------------- ----------
<S> <C> <C>
David H. Benson................... Chairman, Charter European Trust Plc. (financial 1995
62 management); formally Vice Chairman of The Kleinwort
Benson Group, Plc.; Director of The Rouse Company
(real estate development); Director of B. G. Plc.
(British gas company) and Chairman of The Charities
Official Investment Fund; Director of Daniel Thwaites
Plc. (beverage manufacturer).
Jean-Pierre M. Ergas.............. Chairman and Chief Executive Officer, BWAY 1994
Corporation
60 (since January 2000; steel manufacturer); Executive
Vice President, Europe, Alcan Aluminum, Ltd.
(aluminum manufacturer); previously Chairman and
Chief Executive Officer of American National Can
Company (beverage can manufacturer); Director of ABC
Rail Products Corporation (rail equipment
manufacturer) and Brockway Standard Holdings
Corporation (container manufacturer).
Roderick J. Fleming............... Deputy Chairman, Robert Fleming Holdings Ltd. 1995
(financial
46 management); Director of Ian Fleming (Glidrose)
Publications, Ltd.; Aurora Exploration and
Development Corporation Ltd. (from 1992 through
November 1999; natural resources); Updown Investment
Company Ltd. (from 1994 through 1999; financial
management) and West Rand Consolidated Mines Limited
(from 1994 through November 1999; natural resources).
</TABLE>
3
<PAGE> 6
<TABLE>
<CAPTION>
YEAR FIRST
BUSINESS EXPERIENCE FOR PAST FIVE YEARS, BECAME
NAME AND AGE POSITIONS WITH DOVER, AND OTHER DIRECTORSHIPS DIRECTOR
------------ --------------------------------------------- ----------
<S> <C> <C>
Kristiane C. Graham............... Private Investor. 1999
42
James L. Koley.................... Chairman, Koley, Jessen, Daubman & Rupiper, P.C. (law 1989
69 firm); Chairman of the Board of Directors of Arts-Way
Manufacturing Co., Inc. (agricultural manufacturing).
Richard K. Lochridge.............. President, Lochridge & Company, Inc. (management 1999
50 consulting firm); Director of Hannaford Brothers Co.
(food retailers), The Lowe's Company, Inc. (home
improvement), PETsMART (pet supplies), John H.
Harland Company (financial marketing services) and
Dynatech Corporation (from 1994 to 1996;
communications technology).
Thomas L. Reece................... Chairman of the Board (since May 1999), President and 1993
Chief
57 Executive Officer (since May 1994) of Dover.
Gary L. Roubos.................... Chairman of the Board of Dover (through May 1999); 1976
63 previously Chief Executive Officer (through May
1994); Director of Bell & Howell Company (information
management) and Omnicom Group, Inc. (advertising).
Michael B. Stubbs................. Private Investor; Director of Moore-Handley, Inc. 1999
(wholesale
51 hardware distributor), Lyons, Stubbs & Tompkins, Inc.
(through 1996; investment advisors) and Chairman of
S&P Cellular Holdings, Inc., and its subsidiary
Petroleum Communications, Inc. (through 1995;
communications technology).
</TABLE>
During 1999, the Board of Directors held four meetings. The Board has three
standing committees, namely an Audit Committee, a Compensation Committee and an
Executive Committee. All directors were present at these meetings except for
Roderick Fleming who attended two of the Board of Directors meetings and neither
of the Audit Committee meetings.
The Audit Committee is composed of four directors who are not employees of
the Company. The functions of the Audit Committee consist of recommending
annually to the Board of Directors the appointment of the independent auditors;
reviewing with management and such auditors the audit 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 1999, the Audit
Committee held two meetings. The members of the Audit Committee are James L.
Koley (Chairman), David H. Benson, Roderick J. Fleming and Gary L. Roubos.
The Compensation Committee is composed of three directors who are not
employees of the Company. The Compensation Committee approves compensation for
executive officers, grants, awards and payouts under the stock option plan and
performance program and compensation plan changes. In 1999, the Compensation
Committee held two meetings. The members of the Compensation Committee are
Richard K. Lochridge (Chairman), Jean-Pierre M. Ergas and Kristiane C. Graham.
Magalen O. Bryant had served as a member of the committee until her retirement
from the Board as of the annual meeting in April of 1999.
The Executive Committee is composed of five 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 one meeting
during 1999. The members of the Executive Committee are Gary L. Roubos
(Chairman), Jean-Pierre M. Ergas, James L. Koley, John F. McNiff and Thomas L.
Reece. Mr. McNiff is retiring from the Board as of the Annual Meeting in April
2000.
4
<PAGE> 7
DIRECTORS' COMPENSATION
Management directors receive no compensation for services as a director or
as a member of any Committee. Under the Dover 1996 Non-Employee Directors' Stock
Compensation Plan (the "Directors' Plan"), non-employee directors are granted
2,000 shares of the Company's common stock per year as their primary
compensation for serving as directors. If any director serves for less than a
full calendar year, the number of shares to be granted to that director for the
year will be adjusted pro rata, based on the number of days he or she served as
a Director during such year. For 1999, each non-employee director received 2,000
shares except Kristiane C. Graham, Richard K. Lochridge and Michael B. Stubbs
who received 1,500 shares, 1,500 shares, and 1,000 shares, respectively. Each
non-employee director received a fee of $2,000 for serving on any of the Board
Committees and also received $1,500 for each Board or Committee meeting
attended.
Each non-employee director may chose to serve as a director of one of the
Company's four independent subsidiary Boards, in which case he or she receives
$1,500 for each subsidiary company board meeting attended. During 1999, David H.
Benson, Kristiane C. Graham, James L. Koley and Michael B. Stubbs received
$3,000, $4,500, $4,500 and $1,500, respectively, for serving on such subsidiary
Boards.
James L. Koley is Chairman of Koley, Jessen, Daubman & Rupiper, P.C., a
Nebraska law firm which from time to time performs legal services on behalf of
Dover.
5
<PAGE> 8
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The Summary Compensation Table below shows all remuneration paid by Dover
and its subsidiaries to the Chief Executive Officer and the four other most
highly paid executive officers for services in all capacities for each of the
three calendar years ended December 31, 1999.
<TABLE>
<CAPTION>
ANNUAL LONG-TERM
COMPENSATION(1) COMPENSATION
---------------------------- -----------------------
AWARDS PAYOUTS
---------- ----------
SECURITIES LONG-TERM
UNDERLYING INCENTIVE ALL
NAME AND OPTIONS PLAN OTHER
PRINCIPAL POSITION YEAR SALARY BONUS (#)(2)(3) PAYOUTS(4) COMPENSATION(5)
------------------ ---- -------- ---------- ---------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Thomas L. Reece...................... 1999 $850,000 $1,100,000 85,280 $ 427,442 $ 8,000
Chairman, President and Chief 1998 825,000 850,000 235,131 1,207,380 6,000
Executive Officer of Dover 1997 800,000 875,000 79,973 1,481,588 7,392
Lewis E. Burns....................... 1999 510,000 410,000 22,265 875,770 8,000
Vice President of Dover; 1998 495,000 375,000 25,822 1,035,868 4,000
Director and President of Dover 1997 485,000 340,000 21,579 1,203,888 3,800
Industries, Inc.
Rudolf J. Herrmann................... 1999 480,000 310,000 18,786 191,536 7,000
Vice President of Dover; 1998 465,000 325,000 23,488 644,009 7,000
Director and President of Dover 1997 450,000 305,000 19,899 604,489 7,392
Resources, Inc.
John E. Pomeroy...................... 1999 520,000 440,000 23,540 546,805 102,250
Vice President of Dover; 1998 505,000 330,000 24,801 454,979 91,600
Director and President of Dover 1997 490,000 370,000 22,613 1,875,911 85,203
Technologies, Inc.
Jerry W. Yochum...................... 1999 490,000 390,000 21,453 667,984 13,570
Vice President of Dover; 1998 465,000 340,000 24,217 712,484 13,570
Director and President 1997 450,000 300,000 19,770 919,213 12,962
of Dover Diversified, Inc.
</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 calendar
years shown have been listed for the year earned, and were generally paid in
February of the following calendar year. Perquisites and other personal
benefits paid to each officer in each instance aggregated less than $50,000
or 10% of total salary plus bonus, and accordingly are omitted from the
table.
(2) Awards are shown for services performed in the calendar year indicated but
were granted in February of the following year.
(3) Mr. Reece's award for calendar year 1998 includes 144,839 option shares
granted as a special, one-time bonus to reflect Mr. Reece's contribution to
the successful sale of Dover's elevator operations, which closed on January
5, 1999.
(4) The payout amount is determined as described under Long-Term Incentive Plan
Awards for Calendar Year 2000 on page 8. Amounts shown represent payouts for
the three-year performance period ended with the year shown.
6
<PAGE> 9
(5) Represents Company contributions to the Dover Retirement Savings Plan,
Company payments to other defined contribution plans and Company paid life
insurance premiums on split dollar term life insurance. For 1999, these
amounts are detailed as follows:
<TABLE>
<CAPTION>
DOVER OTHER DEFINED
RETIREMENT CONTRIBUTION INSURANCE
NAME SAVINGS PLAN PLANS PREMIUMS TOTAL
---- ------------ ------------- --------- --------
<S> <C> <C> <C> <C>
T. L. Reece................................ $ 8,000 $ -- $ -- $ 8,000
L. E. Burns................................ 8,000 -- -- 8,000
R. J. Herrmann............................. 7,000 -- -- 7,000
J. E. Pomeroy.............................. 20,000* 82,250 -- 102,250
J. W. Yochum............................... 8,000 -- 5,570 13,570
</TABLE>
- ---------------
* Includes $16,000 contributed to Dover Technologies International, Inc.'s
("DTI") profit sharing plan for Mr. Pomeroy's account. The DTI profit
sharing plan was merged into the Dover Retirement Savings Plan in April
1999.
INCENTIVE PROGRAMS
The Company has an Incentive Stock Option Plan and Cash Performance Program
(the "Performance Plan"), adopted in 1995 (replacing a similar plan which
expired in January 1995), which provides for stock options coordinated with cash
performance awards. At the time of grant, allocations are made such that of each
combined award, greater emphasis is given to cash performance awards at the
operating level, and greater emphasis is given to stock options at the corporate
level. Information on current grants and cash performance awards is given below.
For payouts on prior awards under this program see the Summary Compensation
Table on page 6.
OPTION GRANTS IN LAST CALENDAR YEAR
<TABLE>
<CAPTION>
NUMBER OF % OF TOTAL
SECURITIES OPTIONS
UNDERLYING GRANTED TO EXERCISE GRANT DATE
OPTIONS EMPLOYEES IN PRICE PRESENT
NAME GRANTED(#)(1) CALENDAR YEAR ($/SHARE) EXPIRATION DATE VALUE($)(2)
---- ------------- ------------- --------- ---------------- -----------
<S> <C> <C> <C> <C> <C>
Thomas L. Reece........ 235,131 18 $31 February 4, 2009 $2,083,261
Lewis E. Burns......... 25,822 2 31 February 4, 2009 228,783
Rudolf J. Herrmann..... 23,488 2 31 February 4, 2009 208,104
John E. Pomeroy........ 24,801 2 31 February 4, 2009 219,737
Jerry W. Yochum........ 24,217 2 31 February 4, 2009 214,563
</TABLE>
- ---------------
(1) All options shown were granted in 1999 for services performed in 1998 and
correspond to the awards shown in the Summary Compensation Table for 1998.
The options become exercisable on February 4, 2002. The awards made in
February 2000 with respect to services performed in 1999 are shown in the
Summary Compensation Table for 1999 on page 6.
(2) The grant date present values were determined using the Black-Scholes option
pricing model applied as of the grant date. The assumptions used in applying
this model were: expected life of 6 years; expected dividend yield of 1.15%;
average stock price volatility of 22.20% and a risk-free interest rate of
4.97%, which represents the approximate yield of a zero coupon Treasury Bond
on the date of grant with a maturity date similar to the assumed exercise
period. This resulted in a discounted per share value of $8.86 (28.58% of
the option price). The valuation model was not adjusted for risk of
forfeiture or any vesting or transferability restrictions of the options,
all of which would reduce the value of the options if factored into the
calculation. The Black-Scholes model generates a theoretical value based on
the assumptions stated above and this value is not intended to be used for
predicting the future prices of the Company's common stock nor is there any
assurance that the theoretical value or any other value will be
7
<PAGE> 10
achieved. The actual value of the options will depend on the future
performance of the Company's common stock, the overall market conditions and
the executive officer's continued service with the Company. The value
ultimately realized by the executive officer will depend on the amount by
which the market price of the Company's common stock on the date of exercise
exceeds the exercise price.
AGGREGATED OPTION EXERCISES IN LAST CALENDAR YEAR AND YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE(1) OF UNEXERCISED
UNEXERCISED OPTIONS AT IN-THE-MONEY OPTIONS AT
SHARES YEAR END(#) YEAR END($)
ACQUIRED ON VALUE(1) --------------------------- ---------------------------
NAME EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Thomas L. Reece........... -- $ -- 258,206 425,010 $7,024,397 $6,373,721
Lewis E. Burns............ 49,052 1,551,126 159,830 76,857 4,854,751 1,184,310
Rudolf J. Herrmann........ -- -- 91,298 70,465 2,591,472 1,085,806
John E. Pomeroy........... -- -- 157,254 77,236 4,828,911 1,187,826
Jerry W. Yochum........... -- -- 90,598 70,881 2,543,332 1,091,042
</TABLE>
- ---------------
(1) Calculated by determining the difference between the exercise price and the
average of the high and low market price of Dover common stock (as reported
on the New York Stock Exchange-Composite Transactions) for the exercise
dates or December 31, 1999, as the case may be. The average of the high and
low market price on December 31, 1999 was $45.125.
LONG-TERM INCENTIVE PLAN AWARDS FOR CALENDAR YEAR 2000
<TABLE>
<CAPTION>
PERFORMANCE OR ESTIMATED FUTURE
OTHER PERIOD PAYOUTS UNDER
FEBRUARY 2000 UNTIL MATURATION NON-STOCK PRICE
NAME AWARD OR PAYOUT BASED PLANS(1)
---- ------------- ---------------- ----------------
<S> <C> <C> <C>
Thomas L. Reece................................. $411,070 2000-2002 $411,070
Lewis E. Burns.................................. 427,680 2000-2002 427,680
Rudolf J. Herrmann.............................. 360,855 2000-2002 360,855
John E. Pomeroy................................. 452,183 2000-2002 452,183
Jerry W. Yochum................................. 412,088 2000-2002 412,088
</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: (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). Parameters (1)(a) and (2)(a) apply to Mr.
Reece and other corporate officers and parameters (1)(b) and (2)(b) apply to
the other four listed officers and those participating officers at
independent subsidiaries and operating companies.
There is no payout if growth in earnings is not achieved; there is 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 invested capital.
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 30% of the 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.
8
<PAGE> 11
Given the foregoing, the range of payouts is large. For the past three
years, the amounts shown in the Payout Column of the Summary Compensation Table
represent percentage payouts from 133.50% to 702% of the award given three years
prior to the year of the payout. Earned payouts may not exceed 1,562%. Given
this range, it is difficult to forecast the required estimates called for by
this column; the amounts shown above, payable in February 2003, represent
payouts at the 100% level 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. Actual payouts for the three-year performance period ended
December 31, 1999 (shown on the Summary Compensation Table, page 6) were: Mr.
Reece 127.3%, Mr. Burns 244.2%, Mr. Herrmann 58.1%, Mr. Pomeroy 150.6% and Mr.
Yochum 204.0%.
RETIREMENT PLANS
Dover has a number of defined benefit and defined contribution pension
plans covering substantially all employees of the Company and its domestic and
foreign subsidiaries. Dover also has unfunded supplemental executive retirement
plans and other similar unfunded retirement programs ("SERPs") which provide
supplemental retirement benefits for eligible employees including certain
officers of Dover and its subsidiaries. These supplemental plans basically
extend retirement benefits to cover compensation not covered by underlying
qualified plans because of Federal statutory limitations. 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 related SERPs are based
generally upon (i) final average compensation, defined as the highest 60 months
of compensation out of the last 120 months and (ii) the years of benefit
service. The following table sets forth the aggregate estimated annual benefits
payable upon normal retirement pursuant to the Company's Retirement Plans.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF SERVICE
----------------------------------------------------------
FINAL AVERAGE COMPENSATION 15 20 25 30 35
- -------------------------- -- -- -- -- --
<S> <C> <C> <C> <C> <C>
$ 600,000 $180,000 $240,000 $ 300,000 $ 360,000 $ 360,000
700,000 210,000 280,000 350,000 420,000 420,000
800,000 240,000 320,000 400,000 480,000 480,000
900,000 270,000 360,000 450,000 540,000 540,000
1,000,000 300,000 400,000 500,000 600,000 600,000
1,100,000 330,000 440,000 550,000 660,000 660,000
1,200,000 360,000 480,000 600,000 720,000 720,000
1,300,000 390,000 520,000 650,000 780,000 780,000
1,400,000 420,000 560,000 700,000 840,000 840,000
1,500,000 450,000 600,000 750,000 900,000 900,000
1,600,000 480,000 640,000 800,000 960,000 960,000
1,700,000 510,000 680,000 850,000 1,020,000 1,020,000
1,800,000 540,000 720,000 900,000 1,080,000 1,080,000
1,900,000 570,000 760,000 950,000 1,140,000 1,140,000
2,000,000 600,000 800,000 1,000,000 1,200,000 1,200,000
</TABLE>
Compensation for plan purposes includes salary and annual bonus but
excludes any payments or stock option awards under the Performance Plan.
Generally, vesting of pension benefits occurs after completion of five years of
employment subsequent to age 18. The table above shows the estimated annual
benefit payable upon retirement on a straight life annuity basis 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. Reece 34, Mr. Burns 40, Mr. Herrmann 11, and Mr. Yochum 17. All of
these persons are
9
<PAGE> 12
vested. The benefit amounts listed in the table include the annuitized portion
of the defined contribution accumulation attributable to Company contributions
and one half of the social security benefits to which the covered employee may
be entitled.
In addition to participating in one of Dover's qualified defined
contribution plans, Mr. Pomeroy also participates in the Supplemental Executive
Retirement Program of Dover Technologies. This is a non-qualified account
balance plan which, based on annual salary and bonus, credits to individuals the
amounts which an employer could have contributed to the account of such
individual under an existing qualified defined contribution plan but for current
Federal statutory limitations, less amounts actually contributed to such
qualified plans for such individual. For 1999, Mr. Pomeroy's account was
credited with $57,163. Account balances are currently credited with interest at
the rate of 10% per annum, compounded annually, so long as such individual
remains an employee. Amounts credited are payable in a lump sum upon retirement.
CHANGE OF CONTROL PROVISIONS
The Company has agreements with 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, 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 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" (all as
defined in the agreements), then such officer will receive a lump sum payment
equal to three times the highest base salary and annual bonus (but not any award
under the Performance Plan or any other compensation) received by such officer
in any of the most recent five years. The severance amounts to be paid may be
subject to reduction if the officer, at the time of termination, is within 36
months from his normal retirement age. In addition, upon termination, all cash
performance awards outstanding will immediately vest and be paid to the officer
and all stock options which have been held by the officer for more than six
months will immediately vest and become exercisable. Also, in the event of a
change of control, the present value of certain unfunded deferred compensation
plans, including the Company's SERP plans, will be paid immediately to such
officers in a lump sum.
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 more than
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 in most cases, if an individual became subject to the excise
taxes, the Company would gross-up the individual's payments to make him or her
whole.
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
annual compensation for the Company's executive officers, administers the
Performance Plan and the Dover Corporation Executive Officer Annual Incentive
Plan (the "Incentive Plan"), and approves 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 last done in 1994, and to a limited extent in 1996, 1997 and 1998 (for
purposes of the special one-time bonus award related to the sale of the elevator
operations). The results of those reviews are reflected in this report.
10
<PAGE> 13
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 Dover's total return to
stockholders generally and should be competitive with 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
through salaries and bonuses, on a medium-term basis through three-year payout
cash performance awards, and on a long-term basis through stock options. The
relative "mix" of medium-term and long-term opportunity is adjusted in
accordance with the breadth of the executive's responsibility across the
organization, with increasingly larger percentages allocated to long-term reward
potential through stock options in the case of those persons who are in
positions to most materially affect the profitability and growth of the Company.
In early 1999, the Performance Plan was amended to also allow the Committee to
make restricted stock awards, with voting and dividend rights, that vest up to
five years after grant. Restricted stock is generally not awarded except in
connection with special or unusual circumstances. Cash performance awards and
stock option grants are made on an annual basis. However, to provide incentives
to management to increase stockholder value over the medium and long-term,
payouts on cash performance awards, if earned, occur three years later based on
achieving certain performance goals for the three-year period; restricted stock
vests up to five years after grant; and options generally have 10-year terms and
are not exercisable until three years after their grant. With respect to
pensions and other similar benefit programs, the Committee has set a target at
the median of comparable companies. All compensation paid to the executive
officers for 1999 qualified for deductibility for federal income tax purposes
under Section 162(m) of the Code.
Annual Compensation: The Committee reviews the Company's performance
annually. As indicated above, the compensation programs of the Company are
highly leveraged on the basis of performance. In setting compensation, the
Company reviews the performance of the Company as compared to the companies in
the Total Compensation Management database (the "TCM database"). Prior to 1999,
the Company measured its performance against other companies in the Management
Compensation Services Project 777 database (the "Project 777 database").
However, in 1999, the Project 777 database was merged into the TCM database,
thereby providing a much broader base of companies against which the Company now
measures its performance. The Company has for years performed in the top
quartile as measured by the Project 777 database, and continues to do so, as
measured by the TCM database, which currently includes in excess of 40% of the
manufacturing companies included in the Fortune 500 Listings. The TCM 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 of a company in the TCM database, which determines that company's 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 for the current year; return on assets for one year and
five years; and total capital return for one and five years. As a result of the
1994 compensation review mentioned above, the Committee 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.
In 1998, the Company adopted the Incentive Plan which is administered by
the Committee. The Committee has discretion to select executive officers to
participate in the Incentive Plan in any given year. Executive officers selected
to participate in the Incentive Plan would receive their annual bonuses, if any,
for that year under the terms of the Incentive Plan instead of the Company's
traditional bonus program. Mr. Reece is the only executive officer who
participated in the Incentive Plan for 1998 and 1999. For 2000, Messrs. Reece,
Burns, Herrmann, Pomeroy and Yochum will participate in the Incentive Plan.
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
(i.e., corporate, independent subsidiary and operating levels) over periods of
11
<PAGE> 14
time longer than one fiscal year, typically three years. Given the different
levels and opportunities to impact Dover's long-term growth, and hence benefit
Dover's stockholders, Dover has a long-term compensation program, the
Performance Plan, which includes both stock-based awards 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,
restricted stock or cash incentive awards under the Performance Plan. Long-term
awards under the Performance Plan are basically a "mix" of stock based and cash
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 based awards, usually stock options. Under the Performance Plan,
the maximum award is calculated based on an individual's base salary, and in
some cases, the most current annual cash bonus, which amount is then multiplied
by pre-established factors to determine both the allocation of the award between
cash and options and the value of the two. Once the value of the stock option
grant is determined, the value is converted into a number of shares based on the
fair market value of the Company's stock on the date of grant. The payout of
cash incentive awards is conditional upon achievement of certain performance
criteria over the three-year period commencing with the year of the award. For a
discussion of the performance criteria with respect to cash incentive awards,
see the Long-Term Incentive Plan Awards for Calendar Year 2000 table on page 8.
The multiples for each award are set by the Committee. For the officers
identified in the Summary Compensation Table, the cash incentive awards under
the Performance Plan were based on multiples ranging from .20 to .45, and the
number of shares granted was based on multiples ranging from .90 to 1.65. Cash
incentive awards are made annually for the three-year performance period
commencing in that year 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 limited (except that the Plan itself limits the
maximum grant to an individual in any given year to 600,000 options) and prior
grants are not considered by the Committee when current grants are awarded,
although a schedule of outstanding stock options for executive officers is
reviewed by the Committee. 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 less than 1/2 of 1% of shares outstanding over the past
five years and was also less than 1/2 of 1% in 1999. Dover expects that, except
in cases of unusual need, shares acquired through options will be held by
participants (or the participant's family members) for the duration of their
employment with the Company.
B. CHIEF EXECUTIVE OFFICER COMPENSATION
The Compensation Committee awarded Mr. Thomas L. Reece, Chief Executive
Officer, a bonus of $1,100,000 for 1999, which was equal to 129.4% of his 1999
salary of $850,000. In addition, Mr. Reece was granted 85,280 option shares
under the Performance Plan and a cash performance award of $411,070. The annual
bonus amount was determined based upon: (a) outside independent compensation
survey data, which places the compensation of Mr. Reece near the high end of the
median range of the comparative group for companies of Dover's size; (b) the
record sales and earnings achieved in 1999; (c) the general business environment
during 1999; and (d) a subjective judgment factor which is the prerogative of
the Committee. The first three factors were given the greatest weight by the
Committee.
Compensation Committee: Richard K. Lochridge (Chairman)
Jean-Pierre M. Ergas
Kristiane C. Graham
12
<PAGE> 15
STOCK PERFORMANCE GRAPH
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
DOVER CORPORATION, S&P 500 INDEX & PEER GROUP INDEX
TOTAL STOCKHOLDER RETURNS
[TOTAL STOCKHOLDER RETURNS LINE GRAPH]
<TABLE>
<CAPTION>
PEER GROUP DOVER CORP. S&P 500 INDEX
---------- ----------- -------------
<S> <C> <C> <C>
Dec-94 100.00 100.00 100.00
Dec-95 131.74 145.13 137.58
Dec-96 172.02 201.42 169.17
Dec-97 206.99 291.62 225.61
Dec-98 232.10 299.10 290.09
Dec-99 265.08 374.82 351.13
</TABLE>
This graph assumes $100 invested on December 31, 1994 in Dover Corporation
common stock, the S&P 500 index and a peer group index. The peer index consists
of the following public companies selected by the Company based on its
assessment of businesses with similar industrial characteristics: Ametek Inc.,
Applied Power-CL A, Carlisle Cos. Inc., Cooper Industries Inc., Crane Co.,
Danaher Corp., Eaton Corp., Emerson Electric Co., Federal Signal Corp.,
Harnischfeger Industries Inc., Honeywell International, Inc., Hubbell Inc. CL B,
Illinois Tool Works, Ingersoll-Rand Co., ITT Industries Inc., Minnesota Mining &
Mfg., Parker-Hannifin Corp., Pentair Inc., Perkinelmer Inc., Tecumseh Products
Co., TRW Inc., Tyco International Inc. and United Technologies Corp. Last year's
peer group included AMP, Inc. which was acquired by Tyco International, Inc., E.
G. & G., which was acquired by Perkinelmer Inc. and Coltec Industries, Inc.
which was purchased by B.F. Goodrich. This year, we have included Honeywell
International, Inc., and Minnesota Mining & Mfg., because they are substantially
in the same lines of business as the Company. General Electric, which
historically had been included in the peer group, has not been included in this
year's peer index based on the Company's assessment that while General Electric
shares some similar industrial characteristics with the Company, its lines of
business are too dissimilar from the Company's to warrant continued inclusion in
the peer group.
* Total return assumes reinvestment of dividends.
2. RE-APPROVAL OF THE PERFORMANCE GOALS OF THE COMPANY'S 1995 CASH PERFORMANCE
PROGRAM
In 1995, the Company adopted the Performance Plan, which was approved by
the Company's stockholders on April 25, 1995. One part of the Performance Plan
is the 1995 Cash Performance Program (for purposes of this section of the proxy
statement, the "Program"), the purpose of which is to compensate managerial and
other key employees who contribute materially to the success of the Company and
its subsidiaries. Since the Performance Plan including the Program was approved
by the Company's stockholders, awards made under the Program are not subject to
the $1 million tax deduction limit of Section 162(m) of the Internal Revenue
Code (the "Code"). However, because the Company's Compensation Committee (the
"Committee"), which administers the Program, has the authority to establish
different targets under the
13
<PAGE> 16
performance goals of the Program, the performance goals must be re-approved by
the Company's stockholders every five years in order for Program awards to
continue to be qualified performance-based compensation, and not subject to the
$1 million tax deduction limit, under Section 162(m).
Stockholder re-approval of the performance goals requires the affirmative
vote of a majority of the shares present or represented and entitled to vote at
the meeting. In the event that stockholders do not re-approve the performance
goals, the Company may still grant awards to eligible employees; however, the
Company may not be entitled to a deduction on its federal income tax return in
the case of some awards or, in the case of others, may only be entitled to a
partial deduction.
The Board of Directors recommends a vote FOR the re-approval of the
performance goals under the 1995 Cash Performance Program.
SUMMARY
Participation in the Program is offered to salaried officers and other key
employees of Dover and its subsidiaries who, in the opinion of the Committee,
have major responsibility for the present and future success of Dover. The Board
believes that the Program provides 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. The Program is administered by
the Committee.
The performance goals under the Program are (a) long-term earnings growth
and (b) return on equity or investment. Under the Program, the Committee may
grant a participant the opportunity to earn a cash performance payment based
upon achieving certain financial results over a performance period of not less
than three years, which results reflect real growth in long-term earnings and
favorable return on investment. Performance parameters with respect to each
performance period are pre-established by the Committee and must be 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. The actual payout amount
is determined at the end of the performance measurement period and is equal to
the award amount multiplied by a percentage which is derived from a combination
of the performance goals and parameters described above. For a description of
the performance matrix used for awards made in 2000 to the officers who are
listed in the Summary Compensation Table, see note (1) and the accompanying
discussion on pages 8 and 9.
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. The
Committee has established that the maximum amount payable under the Program to
participants in any individual company, or business unit, cannot exceed thirty
percent of the average annual nominal earnings growth of that unit over a
three-year period. The Committee, at its discretion, may alter or eliminate this
maximum limit.
The Committee has the discretion to decrease the amount payable upon the
attainment of a performance target to take into account the effect of any
unusual, non-recurring circumstance. It also 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 and subject to non-compete
requirements) and before performance payment is made, the participant will
receive the full performance payment as if he/she had not retired. In the event
of a participant's death, permanent disability, or (subject to non-compete
requirements) 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 in
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.
14
<PAGE> 17
OTHER INFORMATION
The Board may amend the Program as it deems advisable, except that
stockholder approval is required for any amendment that would otherwise cause
the Program not to comply with Rule 16b-3 under the Exchange Act. The Committee
may amend outstanding awards consistent with the Program if the amendment either
does not impair the participant's rights or is agreed to by the participant.
FEDERAL INCOME TAX CONSEQUENCES
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,
assuming that stockholder re-approval is obtained.
PLAN BENEFITS
The table below shows the Cash Performance payments to be made in the first
quarter of 2000 and the Cash Performance awards made in February 2000. The
benefits or amounts that will be awarded or paid after 2000 are not determinable
at this time.
<TABLE>
<CAPTION>
FEBRUARY 2000 FEBRUARY 2000 AWARDS
NAME PAYOUT(1) TO BE PAID OUT IN FUTURE YEARS(2)
---- ------------- ---------------------------------
<S> <C> <C>
Thomas L. Reece...................................... $ 427,442 $ 411,070
Chairman, President and Chief Executive Officer of
Dover Corporation
Lewis E. Burns....................................... 875,770 427,680
Vice President of Dover; Director and President of
Dover Industries, Inc.
Rudolf J. Herrmann................................... 191,536 360,855
Vice President of Dover; Director and President of
Dover Resources, Inc.
John E. Pomeroy...................................... 546,805 452,183
Vice President of Dover; Director and President of
Dover Technologies, Inc.
Jerry W. Yochum...................................... 667,984 412,088
Vice President of Dover; Director and President of
Dover Diversified, Inc.
Executive Group...................................... 2,989,386 2,398,771
Non-Executive Director Group(3)...................... None None
Non-Executive Officer Employee Group................. 25,070,571 13,063,336
</TABLE>
- ---------------
(1) The payout amount is determined at the end of the three-year performance
measurement period and is equal to the award amount multiplied by a
percentage which is derived from a performance matrix, or table, which uses
two performance parameters: (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). Parameters (1)(a) and
(2)a apply to Mr. Reece and other corporate officers, and parameters (1)(b)
and (2)b apply to the other four listed officers and those participating
officers at independent subsidiaries and operating companies.
(2) Awards are granted as described in the Summary Description of the Program
above.
(3) Non-employee directors are not eligible to participate in the Program.
15
<PAGE> 18
MISCELLANEOUS
OTHER MATTERS
Management does not know of any other business to be taken up at the
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.
RELATIONSHIP WITH INDEPENDENT ACCOUNTANTS
The independent certified public accounting firm of PricewaterhouseCoopers
LLP is the independent public accountant selected in August 1999 to audit the
annual accounts of Dover and its subsidiaries for 2000. This firm also audited
the financial statements for 1998 and 1999. Representatives of
PricewaterhouseCoopers LLP are not expected to be present at the Meeting.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires that the
Company's directors and officers file reports of ownership and changes of
ownership of the Company's common stock with the Securities and Exchange
Commission and the New York Stock Exchange. Based solely on copies of such
reports provided to the Company, the Company believes that all directors and
officers filed on a timely basis all such reports required of them with respect
to stock ownership and changes in ownership during 1999, except that Kristiane
C. Graham filed a late report of her initial statement of beneficial ownership
of securities.
STOCKHOLDER PROPOSALS FOR 2001 ANNUAL MEETING
In order for stockholder proposals to be included in Dover's proxy
statement for the 2001 Annual Meeting, they must be received by Dover at its
principal executive offices, 280 Park Avenue, New York, NY 10017 by November 18,
2000. All other stockholder proposals, including nominations for directors, must
be received by Dover not less than 60 days or more than 90 days prior to the
Meeting, which is tentatively scheduled for April 24, 2001.
Dated: March 17, 2000
By authority of the Board of
Directors,
ROBERT G. KUHBACH
Secretary
16
<PAGE> 19
PROXY PROXY
DOVER CORPORATION
PROXY SOLICITED BY BOARD OF DIRECTORS FOR ANNUAL MEETING, APRIL 25, 2000.
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, 2000 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. For participants in the Company's Retirement
Savings Plan, this proxy will govern the voting of stock held for the account of
the undersigned in the Plan.
IMPORTANT -- You now have the option of voting your shares by returning the
enclosed proxy card or by voting by using a toll-free telephone number. On the
reverse side of this proxy card are instructions on how to vote by telephone. If
you vote by telephone, your vote will be recorded as if you mailed in your proxy
card. If you vote by returning this proxy card, you must sign and date this
proxy on the reverse side.
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE SPECIFICATIONS MADE ON THE
REVERSE SIDE, BUT IF NO CHOICES ARE INDICATED, THIS PROXY WILL BE VOTED FOR ALL
NOMINEES LISTED ON THE REVERSE SIDE.
<PAGE> 20
PROXY DOVER CORPORATION PROXY
2000 ANNUAL MEETING
1. Election of Directors-- For Withhold For All (Except Nominee(s)
written below)
All All _________________________
Nominees: (01) D. H. Benson,
(02) J-P. M. Ergas, (03) R. J. Fleming,
(04) K. C. Graham, (05) J. L. Koley,
(06) R. K. Lochridge, (07) T. L. Reece,
(08) G. L. Roubos, and (09) M. B. Stubbs.
2. To re-approve the performance goals for For Against Abstain
the Company's 1995 Cash Performance Program.
3. To transact such other business as may For Against Abstain
properly come before the meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1 AND 2.
Please Sign Here and Return Promptly
Signature (s) _______________________ Dated:_________, 2000
_______________________
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.
<PAGE> 21
FOLD AND DETACH HERE
Control Number
_______________
VOTE BY TELEPHONE
CALL* * TOLL FREE * * ON A TOUCH TONE TELEPHONE
1-877-587-0760
THERE is NO CHARGE to you for this call.
Your telephone vote authorizes the named proxies to vote your shares in the same
manner as if you marked, signed and returned your proxy card. You will be asked
to enter a Control Number which is located in the box on the left side of this
form.
OPTION #1: To vote as the Board of Directors recommends on ALL proposals:
Press 1.
WHEN ASKED, PLEASE CONFIRM YOUR VOTE BY PRESSING 1 -- THANK YOU FOR
VOTING.
OPTION # 2: If you choose to vote for each proposal separately, press 0. You
will hear these instructions:
Proposal 1: To vote FOR ALL nominees, press 1; to WITHHOLD FOR ALL
nominees, press 9.
To WITHHOLD FOR AN INDIVIDUAL nominee, Press 0 and listen to
the instructions.
Proposal 2: To vote FOR, press 1; AGAINST, press 9; ABSTAIN, press 0.
Proposal 3: To vote FOR, press 1; AGAINST, press 9; ABSTAIN, press 0.
WHEN ASKED, PLEASE CONFIRM YOUR VOTE BY PRESSING 1 -- THANK YOU FOR
VOTING.
IF YOU VOTE BY TELEPHONE, DO NOT MAIL BACK YOUR PROXY.
