8-KLeadership Changes

DOVER Corp 8-K Report, Executive Changes (Feb 15, 2012)

Filed February 15, 2012For Securities:DOV

Summary

This 8-K filing from Dover Corporation (DOV) on February 15, 2012, details executive compensation decisions made by the Compensation Committee and independent directors. Key actions include the awarding of 2011 annual cash bonuses, payouts under a 2009-2011 Cash Performance Program, and distributions from 2009 performance share grants. The filing also outlines new long-term incentive compensation grants for the 2012-2014 performance period, including cash performance awards, stock appreciation rights, and performance shares. Investors should note the significant payouts related to prior performance periods, particularly for William Spurgeon who received a substantial payment under the Cash Performance Program and Robert Livingston and William Spurgeon who received substantial performance share payouts. The new long-term grants signal continued performance-based compensation, with targets tied to internal total shareholder return for business units and relative total shareholder return for the company. The stock appreciation rights granted have a strike price of $65.38 and vest in February 2015, indicating management's continued equity alignment with shareholder value.

Key Highlights

  • 1Dover Corporation's executive team received 2011 annual cash bonuses, with Robert Livingston, the CEO, receiving the largest at $1,525,000.
  • 2Significant payouts were distributed under the 2009-2011 Cash Performance Program, with William Spurgeon receiving $1,276,000 and Robert Livingston receiving $479,779.
  • 3Performance share grants from 2009 were paid out, with Robert Livingston receiving 14,271 shares and William Spurgeon receiving 4,934 shares, contingent on relative Total Shareholder Return (TSR) for 2009-2011.
  • 4New long-term incentive compensation grants were awarded for the 2012-2014 performance period.
  • 5These new grants include substantial Stock Appreciation Rights (SSARs) for Robert Livingston (220,251) and significant Cash Performance Program targets (e.g., $1.2M for Livingston).
  • 6The new performance share grants are tied to Dover's relative TSR performance against its peer group over the 2012-2014 period.
  • 7Stock Appreciation Rights granted have a base price of $65.38 and vest on February 9, 2015, with a ten-year term, settling only in company stock.

Frequently Asked Questions

This filing discusses four main components of executive compensation: 2011 annual cash bonuses, payouts from a 2009-2011 Cash Performance Program, payouts of 2009 performance share grants, and new long-term incentive compensation grants for the 2012-2014 performance period (including cash performance, stock appreciation rights, and performance shares).

The 2011 annual bonuses were based on the percentage achievement of earnings and personal objectives set for 2011. The payouts under the 2009-2011 Cash Performance Program and the 2009 Performance Share grants were determined by the internal total shareholder return (TSR) of the participants' business units and Dover's TSR relative to its peer group, respectively, over the specified three-year performance periods.

The new long-term incentive grants include Cash Performance Program targets, Stock Appreciation Rights (SSARs) with a base price of $65.38 that vest in February 2015, and Performance Shares. The payouts for the cash and share awards are contingent on internal business unit TSR and Dover's relative TSR against its peers, respectively, over the 2012-2014 performance period.

Yes, William Spurgeon received a notable payout of $1,276,000 under the 2009-2011 Cash Performance Program. Robert Livingston and William Spurgeon also received substantial payouts in performance shares (14,271 and 4,934 shares, respectively) based on relative TSR.