Business Context and Reporting Period
This Form 8-K filing by Dover Corporation (DOVER) was submitted on February 10, 2010, reporting events occurring on February 10-11, 2010. The filing details actions taken by the Compensation Committee and the Board of Directors regarding executive compensation for the fiscal year 2009 and the establishment of compensation for 2010.
Key Financial Metrics and Compensation Data
The filing does not report company-wide revenue, profit, cash flow, margins, debt, or liquidity metrics. It focuses exclusively on executive compensation figures:
- 2009 Annual Cash Bonuses:
- Robert Livingston (CEO): $1,000,000
- William Spurgeon: $475,000
- David Van Loan: $442,000
- Brad Cerepak (CFO): $320,000 (Discretionary bonus; did not participate in the annual plan as he joined after Q1 2009).
- 2010 Long-Term Incentive Grants (Target Values):
- Robert Livingston: $1,000,000 Cash Performance, 279,851 Stock Appreciation Rights (SSARs), 23,321 Performance Shares.
- Brad Cerepak: $300,000 Cash Performance, 51,306 SSARs, 3,498 Performance Shares.
- William Spurgeon: $400,000 Cash Performance, 41,978 SSARs, 3,498 Performance Shares.
- David Van Loan: $400,000 Cash Performance, 41,978 SSARs, 3,498 Performance Shares.
- SSAR Terms: Base price of $42.88 (closing price on grant date); exercisable February 11, 2013; ten-year term; settled in stock.
Material Changes and Salary Adjustments
Regarding base salaries, no named executive officer received a salary increase for 2010. The filing notes that each named executive officer took a salary reduction for most of 2009, and these salaries were restored to their previous levels as of the beginning of 2010.
Outlook, Risks, and Performance Criteria
The long-term incentive awards granted in 2010 are tied to specific performance metrics over a three-year period (2010-2012) compared to the 2009 base year:
- Cash Performance Awards: Payout depends on the internal total shareholder return achieved by the participant's specific business unit.
- Performance Shares: Payout depends on the Company's total shareholder return (TSR) relative to the TSR of companies in the Company's peer group.
- Reference: Detailed descriptions of the 2005 Equity and Cash Incentive Plan and the peer group are referenced in the Company's 2009 proxy statement filed on March 24, 2009.
Key Facts for Investor Verification
- Verify the specific peer group composition used for TSR comparisons in the 2009 proxy statement.
- Confirm the exact salary reduction percentages taken in 2009 and the restored 2010 salary levels for each executive.
- Monitor the vesting schedule and performance hurdles for the 2010-2012 long-term incentive grants.
- Note that Brad Cerepak's 2009 bonus was discretionary due to his late entry into the company, unlike the formula-based bonuses for other executives.