UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
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☑ | Definitive Proxy Statement | |
☐ | Definitive Additional Materials | |
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Crane Co.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
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CRANE CO.
100 FIRST STAMFORD PLACE
STAMFORD, CONNECTICUT 06902
Dear Fellow Stockholders:
Crane Co. cordially invites you to attend the Annual Meeting of Stockholders of Crane Co., which will be held at 10:00 a.m., Eastern Daylight Time, on Monday, April 23, 2018 in the26, 2021, at 100 First Stamford Place, Ground Floor Conference Room, at 200 First Stamford Place, Stamford, Connecticut.
The Notice of Annual Meeting and Proxy Statement on the following pages describe the matters to be presented at the meeting. Management will report on current operations, and there will be an opportunity to ask questions regarding Crane Co. and its activities. Our 2017 Annual Report to Stockholders accompanies this Proxy Statement.
It is important that your shares be represented at the meeting, regardless of the size of your holdings. If you are unable to attend in person, I urge you to participate by voting your shares by proxy. You may do so by filling out and returning the enclosed proxy card, or by using the internet address or the toll-free telephone number onset forth in this Proxy Statement, or by requesting a printed copy of the proxy card.materials and completing and returning by mail the proxy card you receive in response to your request.
Sincerely,
R.S. Evans
James L.L. Tullis
Chairman of the Board
March 15, 201812, 2021
This Proxy Statement | |||
and the 2020 Annual Report to Stockholders are available at www.craneco.com/ar | |||
This Proxy Statementand the 2017 Annual Report to Stockholdersare available at www.craneco.com/ar
2018 Proxy Statement 1
2021 Proxy Statement | 1 |
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NoticeTable of Annual Meetingof Stockholders
ContentsApril 23, 2018
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS | ||
APRIL 26, 2021 | ||
To the Stockholders of Crane Co.:
THE 2018
The 2021 ANNUAL MEETING OF STOCKHOLDERS OF CRANE CO. will be held for the following purposes:
![]() | WHEN: |
April 26, 2021 Monday 10:00 a.m. Eastern Daylight Time | |
![]() | WHERE: |
100 First Stamford Place Ground Floor Conference Rm Stamford, Connecticut | |
HOW TO VOTE: | |
![]() | By Phone |
800-652-VOTE (8683) in the United States, United States territories, and Canada | |
![]() | By Mail |
If you have requested a paper copy of the proxy materials, complete, sign, and return the proxy card. | |
![]() | By Internet |
www.envisionreports.com/cr | |
![]() | In Person |
Stockholders at the close of business on February 26, 2021, are entitled to vote at the meeting in person. | |
![]() | By Scanning |
You can vote your shares online by scanning the QR code on your proxy card. | |
Board | ||
Proposal | Recommendation | |
Item 1 | To elect | FOR each director ► Page 11 |
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In order to assure a quorum at the meeting, it is important that stockholders who do not expect to attend the meeting in person fill in, sign, date and return the enclosed proxy card in the accompanying envelope, or use the internet address or the toll-free telephone number on the enclosed proxy card.
The Board of Directors has fixed the close of business on February 28, 2018 as the record date for the meeting. Stockholders at that date and time are entitled to notice of and to vote at the meeting or any postponement or adjournment of the meeting. A complete list of stockholders as of the record date will be open to the examination of any stockholder during regular business hours at the offices of Crane Co., 100 First Stamford Place, Stamford, Connecticut 06902, for ten days before the meeting, as well as at the meeting.
By Order of the Board of Directors,
Anthony M. D’IorioSecretaryMarch 15, 2018
IF YOU EXPECT TO ATTEND THE MEETING IN PERSON, PLEASE CONTACT THE CORPORATE SECRETARY,CRANE CO., 100 FIRST STAMFORD PLACE, STAMFORD, CONNECTICUT 06902,OR BY EMAIL TO ADIORIO@CRANECO.COM.
2018 Proxy Statement 3
Proxy Summary
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This Proxy Statement and enclosed form of proxy are first being sent to stockholders on or about March 15, 2018.
Voting Matters
Item 2 | To consider and vote on a proposal to ratify the selection of Deloitte & Touche LLP as independent auditors for Crane Co. for | FOR | ► Page 31 | |||
Item 3 | To consider and vote on a proposal to approve, by a non-binding advisory vote, the compensation paid by the Company to certain executive officers | FOR | ► Page 34 | |||
Item 4 | To consider and vote on a proposal to approve the 2018 Amended & Restated Stock Incentive Plan | FOR | ► Page 73 |
Director NomineesIn addition, any other business properly presented may be acted upon at the meeting.
In order to assure a quorum at the 2021 Annual General Meeting of Stockholders of Crane Co. (the “Annual Meeting”), it is important that stockholders who do not expect to attend in person use the internet address or the toll-free telephone number listed in this Proxy Statement to vote. If you have requested paper copies of the proxy materials, you can vote by completing and Continuingreturning the proxy card enclosed in those materials.
Any stockholder of Crane Co., any past or present associate, and other invitees may attend the Annual Meeting. Due to the ongoing COVID-19 pandemic, attendees will be required to comply with various health and safety protocols including wearing a cloth face covering and social distancing. We continue to monitor COVID-19 developments and if we determine that alternative Annual Meeting arrangements are advisable or required, then we will announce any changes in advance in a press release available on our website at www.craneco.com and filed with the Securities and Exchange Commission.
The Board of Directors has fixed the close of business on February 26, 2021, as the record date for the meeting. Stockholders at that date and time are entitled to notice of and to vote at the Annual Meeting or any postponement or adjournment of the Annual Meeting. Each share is entitled to one vote. This Notice of Annual General Meeting of Stockholders and related Proxy Statement are first being distributed or made available to stockholders on or about March 12, 2021.
We previously mailed a Notice of Internet Availability of Proxy Materials to all Crane Co. stockholders as of the record date. The notice advised such stockholders that they could view the Proxy Statement and Annual Report online at www.envisionreports.com/cr, or request in writing a paper or e-mail copy of the proxy materials at no cost. The Company is making its proxy materials available electronically as the primary means of furnishing proxy materials to stockholders in order to reduce the environmental impact and cost of our proxy solicitation.
A complete list of stockholders as of the record date will be open to examination by any stockholder during regular business hours at the offices of Crane Co., 100 First Stamford Place, Stamford, Connecticut 06902, for 10 days before the Annual Meeting, as well as at the Annual Meeting.
By Order of the Board of Directors,
Anthony M. D’Iorio
Secretary
March 12, 2021
If you expect to attend the annual meeting in person, please contact the Corporate Secretary, Crane Co., 100 First Stamford Place, Stamford, Connecticut 06902, or by email to Director Nomineescorpsec@craneco.com.
2021 Proxy Statement |
Director Nominees
Director | Crane Co. Committees | ||||||
Name and Profession | Age | Since | AC | NGC | EC | MOCC | |
![]() | Martin R. Benante Retired Chairman of the Board and Chief Executive Officer, Curtiss-Wright Corporation | 68 | 2015 | ||||
![]() | Donald G. Cook General, United States Air Force (Retired) | 74 | 2005 | ||||
![]() | Michael Dinkins Retired Executive Vice President and Chief Financial Officer, Integer Holdings Corporation | 66 | 2019 | ||||
![]() | Ronald C. Lindsay Retired Chief Operating Officer, Eastman Chemical Company | 62 | 2013 | ||||
![]() | Ellen McClain Chief Financial Officer, Year Up | 56 | 2013 | ||||
![]() | Charles G. McClure, Jr. Managing Partner, Michigan Capital Advisors | 67 | 2017 | ||||
![]() | Max H. Mitchell President and Chief Executive Officer of Crane Co. | 57 | 2014 | ||||
![]() | Jennifer M. Pollino Executive Coach and Consultant, JMPollino LLC | 56 | 2013 | ||||
![]() | John S. Stroup Executive Chairman, Belden, Inc. | 54 | 2020 | ||||
![]() | James L. L. Tullis Chairman, Tullis Health Investors, Inc. | 73 | 1998 |
Audit Committee | |||||||||||||
Nominating and Governance Committee | Chair | Member | |||||||||||
Executive Committee | |||||||||||||
Management Organization and Compensation Committee | |||||||||||||
4 Crane Co.
4 | Crane Co. |
Proxy Summary
Continuing Directors
Board Snapshot
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Corporate Governance Highlights
Recent Governance Enhancements
As stated in our Corporate Governance Guidelines, the Board has a leadership responsibilityis responsible for helping to help create a culture of high ethical standards.standards and is committed to continually improving its corporate governance process, practices and procedures. Accordingly, the Board has adopted the following best practices in corporate governance.
Recent Governance Enhancements
Annual election of directors:Following the recommendation of the Board, stockholders approved at our 2017 annual meeting of stockholders amendments to declassify the Board of Directors. Beginning with the 2017 annual meeting, directors are elected to serve one year terms expiring at the following annual meeting.See page 10 for additional information, including the effect on continuing directors serving the remainder of their terms.
Board renewal (sixand composition (eight new directors in the last five years)eight years and increased board size in 2020):The Board, specifically through the Nominating and Governance Committee, continually evaluates the skills, expertise, integrity, diversity, and other qualities believed to enhance the Board’s ability to manage and direct in an effective manner, the affairs and business of the Company. Since 2013, the Board has added sixeight new directors.directors and, in 2020, increased its size from nine to ten directors, to accomplish these goals. See additional information beginning on page 1213 about our Board nominees and continuing directors.nominees.
New disclosures:Annual election of directors: For this 2018 Proxy Statement, weFollowing the recommendation of the Board, stockholders approved amendments to declassify the Board of Directors at our 2017 annual meeting of stockholders. Since the 2017 annual meeting, all directors have undertaken a thorough reviewbeen elected to serve one-year terms expiring at the following annual meeting. As of the 2019 Annual Meeting, our transition to annual election of all of our proxy disclosures withdirectors was complete. We believe that directors should be re-elected annually, providing more accountability than boards that are staggered and enhancing the intentability to providepromptly evaluate a more reader-friendly document focused on information most important to our stockholders. In this regard, we have added new content on certain governance practices, including Board oversight of management succession planning, stockholder engagement, our Board evaluation process, director education and CEO pay ratio.See pages 21, 24, 25, and 64 for additional information.board’s performance.
2018 Proxy Statement 5
Proxy Summary
Ongoing Board Governance Practices |
• Separate Chairman and CEO roles | • 100% independent Board committees • Regular executive sessions of non-management directors • Annual Board and committee performance self-evaluations • 100% Board and committee attendance in 2020 • Offer of resignation upon significant change in primary job responsibilities • Directors are elected annually • Majority voting and director resignation policy for directors in uncontested elections | ||
• Stringent conflict of interest policies | |||
• Directors subject to | |||
• Director retirement policy | |||
• Strict over-boarding policy for directors • Diverse Board with the appropriate mix of skills, experience and perspective • Comprehensive director nomination and Board refreshment process • Oversight of sustainability and human capital matters impacting our business |
2017
2020 Performance Highlights
In March 2020, the World Health Organization categorized the novel coronavirus (“COVID-19”) as a pandemic. During the remainder of 2020, the COVID-19 pandemic continued to spread throughout the United States and other countries across the world, significantly impacting the health and safety of people around the world and causing wide-spread economic disruptions to the financial markets, the global economy, and to our business.
The COVID-19 pandemic had a substantial impact on demand for most of our businesses and related end markets, and that impact was completely beyond the control of management. The pandemic related demand destruction was so severe that comparison of actual 2020 results to our original 2020 plan and financial targets, as developed in late 2019 and approved by the Board in early 2020, is not meaningful.
2021 Proxy Statement | 5 |
Proxy Summary
The COVID-19 pandemic and related uncertainty also posed unique and substantial challenges for our normal forecasting and budgeting methodologies throughout 2020. Those challenges were so significant that most U.S. public industrial companies withdrew financial guidance in the spring of 2020. However, consistent with our desire to be fully transparent with our stockholders, we publicly revised and updated all elements of our typical financial guidance with additional details and granularity on April 27, 2020, concurrent with the release of our first quarter 2020 financial results. Furthermore, we continued to update our views and outlook at each of our successive quarterly earnings calls in July and October. While actual financial results for 2020 fell short of our initial pre-pandemic guidance, they compared favorably to our April 27, 2020 revised guidance.
Strong Operational Performance Under Challenging Circumstances
We are proud of our response to the unprecedented set of circumstances we faced during 2020, particularly related to the actions we took to ensure the safety and well-being of our associates, and where possible, to retain them through the pandemic. Starting in early March, we quickly adopted new safety protocols and procedures worldwide, in most cases more stringent than, and in advance of, government mandates. We also quickly adopted a new Emergency Pandemic Exception Pay (“EPE”) program providing additional paid time off to all Crane associates globally that were directly or indirectly impacted by COVID-19.
From a financial perspective, we believe that we were on-track to meet or exceed our 2020 financial targets before the pandemic hit, consistent with our commentary at our February 27, 2020 annual Investor Day event. While final 2020 financial results were below our original financial targets for the year, we believe that the shortfall was entirely related to the impact of COVID-19, and that our operational performance and execution against long-term strategic objectives were excellent considering the unexpected market related challenges arising from the pandemic.
• | Sales in 2020 were $2,937 million, or 11%, below sales in 2019. The decline in sales was comprised of a 17% decline in core sales partially offset by a 6% benefit from acquisitions and slightly favorable foreign exchange rates. Notably, the core sales decline compared to our pre-pandemic expectations was most severe at two of our highest margin businesses: the commercial aircraft portion of Aerospace & Electronics which was significantly impacted by reduced passenger air travel (core sales 38% below prior year), and at Crane Payment Innovations where our products cater to consumer traffic, for example, at various retail stores, casino gaming and mass transit ticketing locations, among others (core sales 37% below prior year). Despite the sharp market-driven declines, we believe that we gained market share across most of our primary businesses during 2020. |
• | Adjusted operating profit in 2020 declined 35% compared to 2019. Excluding the impact of acquisitions, decremental margins (change in adjusted operating profit divided by change in sales) of 35%, were an impressive result given the magnitude of the sales decline and the highly negative business and product mix, reflecting extremely strong operational execution. Adjusted earnings per share (EPS) in 2020 declined 36% compared to 2019, similar to the decline in adjusted operating profit. These results also reflect the impact of our cost reduction initiatives which delivered approximately $105 million of gross savings in 2020. |
• | Free cash flow in 2020 declined 15% compared to 2019, a more muted decline than for adjusted operating profit or adjusted EPS, reflecting strong working capital management and controlled capital expenditures. |
6 | Crane Co. |
Proxy Summary
See “Non-GAAP Reconciliation” beginning on page 84 for more detail regarding Special Items impacting EPS, free cash flow and operating margins, as well as a reconciliation of the non-GAAP measures used herein.
In addition to operational execution during 2020, we continued to execute on all key strategic growth initiatives to ensure that Crane emerges from the pandemic related downturn stronger than competitors and positioned for long-term stockholder value creation. Notable accomplishments included:
• | The integration of Cummins-Allison Corp. (acquired in December 2019) and the integration of Instrumentation & Sampling (acquired in January 2020), as well as continued work to identify additional acquisition opportunities. |
• | We introduced new products and solutions at an accelerating pace in 2020, most notably at Fluid Handling and Payment & Merchandising Technologies. |
• | We continued to invest in the development of next-generation technologies, most notably at Aerospace & Electronics and Payment & Merchandising Technologies. |
• | The combination of new product development and advances in our technology capabilities resulted in share gains across our portfolio despite disruptions related to the pandemic. |
• | We continued to execute on repositioning actions in Fluid Handling initiated at the end of 2019 which involved facility consolidations to better geographically align our manufacturing footprint with customer needs, and to improve our cost position. |
Taken together, we believe all these actions position the Company for years of profitable growth.
TSR Lagged Benchmarks Given End Market Headwinds
Despite this strong operational performance, total stockholder return (share price appreciation plus reinvested dividends) (TSR) trailed that of the consistent focusmost relevant benchmark indices on a one- and three-year basis. We believe that underperformance is primarily attributable to our exposure to two end markets that were among the most negatively impacted by the COVID-19 pandemic, and for which investors had substantial concerns about the short- and medium-term outlook: commercial aerospace, and the process industries which include oil & gas.
Crane Co. TSR for Periods Ending December 31, 2020
2021 Proxy Statement | 7 |
Proxy Summary
Consistent with the Management Organization and Compensation Committee (the “Compensation Committee”)Committee’s continued focus on aligning pay with performance, and despite the extraordinary circumstances in 2020, all variable elements of management’s compensation increaseddeclined compared to 2019, reflecting the business performance shortfalls relative to target, and lower three-year relative TSR compared to the prior year. Further, the performance-based restricted share units (PRSUs) granted to our named executive officers (NEOs) for the three-year period 2018-2020 vested at 0% due to below performance threshold resulting in 0 shares payout for 2020, reflecting the negative TSR for that period. PRSUs represent 41% of target pay for our CEO and, 23% of target pay, on average, for our other NEOs. In addition, reflecting the impact that the year’s financial performance had on both stockholders and other stakeholders, including Crane associates, our executive officers, including our NEOs, voluntarily took a temporary reduction in base pay from April through December (20% for the CEO and 10% for all other executive officers).
Crane Co. 2017 TSR Better than Benchmark Indices
Continued to Execute on Near-Term Priorities in 2017
In 2017, the Company delivered strong financial results in line with our operating plan objectives. Specifically:
6 Crane Co.
Proxy Summary
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20172020 Compensation Highlights
Compensation Best Practices
The Management Organization and Compensation Committee is firmly committed to implementing aan executive compensation program that aligns management and stockholder interests, encourages executives to drive sustainable stockholder value creation, and helps retain key personnel. Moreover, despite the global disruptions and adverse impact to the Company’s business caused by the ongoing pandemic, we remained committed to maintaining our core compensation plan design. Key elements of our pay practices are as follows:
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• Pay for performance, aligning executive pay with Company results and stockholder returns | • Require significant stock ownership by executives, including a 6x base salary requirement for the CEO • Majority of executive variable pay is delivered in long-term equity-based awards • Appropriate mix of fixed and variable pay to balance employee retention with Company goals, both annual and long-term | |||
• Incentive compensation subject to clawback | ||||
• Management Organization and Compensation Committee retains independent compensation consultant |
• No excise tax gross-ups upon change in control | • No multi-year guaranteed incentive awards • No fixed-duration employment contracts with executive officers • No hedging or pledging of Company stock permitted • No excessive perquisites for executives | ||
• No | |||
• No repricing of options | |||
• No discounted stock options |
2018 Proxy Statement 7
8 | Crane Co. |
Proxy Summary
Pay andfor Performance Alignment
Over 80%
85% of CEO Target Pay is Performance-Based
The following table summarizes the major elements of our CEO compensation program.program, which is designed to link pay and performance.
Totals may not sum due to rounding.
Our Philanthropy, Sustainability and Equality Highlights
Philanthropy
Sustainability
Equality
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![]() See additional details on the Company’s efforts and performance with respect to philanthropy, sustainability, and equality, at www.craneco.com/pse. |
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8 Crane Co.
Proxy Statement | ||
Proxy Statement
2018 Proxy Statement 9
10 | Crane Co. |
Item 1: Election of Directors | ||
![]() ![]() | PROPOSAL 1 The Board recommends votingFOReach of theDirector Nominees | ![]() |
Crane Co. Board of DirectorsComposition
Our Corporate Governance Guidelines provide that the Board should generally have from nine to twelve directors, a substantial majority of whom must qualify as independent directors under the listing standards of the NYSE.New York Stock Exchange (“NYSE”).
The Board of Directors currently consists of 12ten members, 11nine of whom are independent.
Prior to the 2017 annual meeting of stockholders, On December 8, 2020, the Board of Directors was divided into three classes with staggered three year terms. At the 2017 annual meeting, stockholders voted to declassifyincrease the size of the Board from a total of Directorsnine directors to ten and provide forto appoint John S. Stroup to fill that newly created interim vacancy. Mr. Stroup was also appointed to serve as a member of the annual election of directors, without reducing the term of any then incumbent director. There are sevenManagement Organization and Compensation Committee.
The ten directors whose terms will expire at the time of the Annual Meeting, but will serve until their successors are duly elected and four directors whose terms will expire at the annual meeting of stockholders in 2019.
The seven directors whose terms will expire at the time of the Annual Meetingqualified, are Martin R. Benante, Donald G. Cook, R.S. Evans,Michael Dinkins, Ronald C. Lindsay, Philip R. Lochner, Jr.,Ellen McClain, Charles G. McClure, Jr. and, Max H. Mitchell.Mitchell, Jennifer M. Pollino, John S. Stroup, and James L. L. Tullis. The Board of Directors has nominated each of them for re-election by the stockholders for a one yearone-year term to expire at the 20192022 annual meeting of stockholders. The Board of Directors has determined that all directors other than Mr. Mitchell are independent directors.
E. Thayer Bigelow, who has been a member of the Board since 1984, has reached the mandatory retirement age under our Corporate Governance Guidelines and will retire from the Board as of the time of the Annual Meeting.
Peter Scannell, who has been a member of the Board since 2015 and whose term would expire in 2019, has informed the Corporate Secretary that he intends to retire from the Board as of the time of the Annual Meeting.
The three remainingCompany believes a board with between nine to twelve directors Ellen McClain, Jennifer M. Pollinois appropriate to generate a manageable diversity of thought, perspective and James L. L. Tullis, who are not standing for election at the Annual Meeting, will continue to serve for the remainder of the terms for which they were elected, which will expire at the 2019 annual meeting of stockholders, and until their successors are duly elected and qualified.insight in a cost-efficient manner.
Director Nominating Procedures
The Board believes that a company’s directors should possess and demonstrate, individually and as a group, an effective and diverse combination of skills and experience to guide the management and direction of the Company’s business and affairs.affairs and to align with our long-term strategic vision. The Board has charged the Nominating and Governance Committee with responsibility for evaluating the mix of skills, experience and experiencediversity of background of the Company’s directors and director nominees, as well as leading the evaluation process for the Board and its committees.
Criteria for Board membership take into account skills, expertise, integrity, diversity, and other qualities which are expected to enhance the Board’s ability to manage and direct Crane Co.’s business and affairs. In general, nominees for director should have an understanding of the workings of large business organizations such as Crane Co., and senior level executive experience as well asleadership experience. In addition, nominees should have the ability to make independent, analytical judgments, the ability toand they should be an effective communicator andcommunicators with the ability and willingness to devote the time and effort required to be an effective and contributing member of the Board.
A director who serves as a chief executive officer shouldmay not serve on more than two public company boards in addition to our Board, and other directors should not sit on more than four public company boards in addition to our Board. The members of the Audit Committee shouldmay not serve on more than two other audit committees of public companies. All of the director nominees are in compliance with these requirements.
10 Crane Co.
Item 1: Election of Directors
The Nominating and Governance Committee has proposed, and the Board of Directors recommends, that each of the seventen nominees be elected to the Board. If, before the meeting, any nominee becomes unavailable for election as a director, the persons named in the enclosed form of proxy will vote for whichever nominee, if any,elected directors may make an interim vacancy appointment to the Board of Directors recommends to fillafter the vacancy,Annual Meeting, or the Board of Directors may reduce the number of directors to eliminate the vacancy.
2021 Proxy Statement | 11 |
Item 1: Election of Directors
Board Composition
Our Board takes an active and thoughtful approach to board composition and is focused on building and maintaining a diverse board. In conducting its annual review of director skills and Board composition, the Nominating and Governance Committee determined and reported to the Board its judgment that the Board as a whole demonstrates a diversity of organizational experience,and professional experience, education, and other background, viewpoint, skills, and other personal qualities and attributes that enables the Board to perform its duties in a highly effective manner. The NominatingCompany is proud to have such a diverse Board, including with respect to gender and Governance Committee also considers the Board’s overall diversity of experience, education, background, skillsethnicity.
Board Snapshot
Board Skills and attributes when identifying and evaluating potential director nominees.Experience
Board Snapshot
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Our individual Board members have a wide range of skills and experience from within and outside our industry, giving them diverse perspectives from which to oversee the Company’s strategy of manufacturing a diverse range of highly engineered industrial products in markets where we have competitive differentiation and scale, and growing the business globally organically and through domestic and international acquisitions. Our Board members possess expertise in, among other things, acquisitions and other business combinations, diversified industrial operations and manufacturing, international business, corporate finance, human capital management, and organizational leadership.
2018 Proxy Statement 11
Summary of Board Skills and Experience
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Public company multinational CEO experience | ● | ● | ● | ● | ● | |||||
Public company multinational CFO experience | ● | |||||||||
General finance acumen | ● | ● | ● | ● | ● | ● | ● | ● | ● | ● |
Corporate governance/board experience | ● | ● | ● | ● | ● | ● | ● | ● | ● | ● |
Mergers & acquisitions | ● | ● | ● | ● | ● | ● | ● | ● | ● | ● |
Manufacturing operations | ● | ● | ● | ● | ● | ● | ● | |||
Expertise with one or more of Crane Co.’s end markets | ● | ● | ● | ● | ● | ● | ||||
Intellectual capital development (human capital) | ● | ● | ● | ● | ● | ● | ● | ● | ● | ● |
Independent | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | |
Self-Identified Race/Ethnicity | ||||||||||
African American | ● | ● | ||||||||
White Caucasian | ● | ● | ● | ● | ● | ● | ● | ● | ||
Self-Identified Gender | ||||||||||
Male | ● | ● | ● | ● | ● | ● | ● | ● | ||
Female | ● | ● |
The Board Composition and Board Skills and Experience sections above reflect the Board’s current ten director nominees.
12 | Crane Co. |
Item 1: Election of Directors
Board of Directors Nominees and Continuing Directors
Nominees to be Elected for Terms to Expire in 20192022
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![]() | MARTIN R. BENANTE | |||
Age: 68 Director Since:2015 | Crane Co. Committees:Audit Nominating & Governance | |||
Retired Chairman of the Board and Chief Executive Officer of Curtiss-Wright Corporation, Charlotte, NC (supplier of highly engineered products and services to commercial, industrial, defense, and energy markets), having served from 2000 to | ||||
2015. Other Directorships: • | ||||
Relevant Skills and Experience: • • • Expertise in domestic and international mergers and acquisitions, and in the global integration of acquired companies | ||||
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![]() | DONALD G. COOK | |||
Age: 74 Director Since:2005 | Crane Co. Committees:Nominating and Governance (Chair); Management Organization and | |||
General, United States Air Force (Retired); consultant; independent | ||||
director since 2005. Other Directorships: • Texas Pacific Land Corporation since December 2020
• USAA Federal Savings Bank • | ||||
Relevant Skills and Experience: • • | ||||
12 Crane Co.
Note: Age calculations for all directors are as of the Record Date.
2021 Proxy Statement | 13 |
Item 1: Election of Directors
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![]() | MICHAEL DINKINS | |||
Age: 66 2019Director Since: | Crane Co. Committees: | |||
Retired Executive Vice President and Chief Other Directorships: • The Shyft Group since 2020 • Community Health Systems, Inc. since 2017 • National Council on Compensation Insurance, Inc. since 2015 | ||||
Relevant Skills and Experience: • Sophisticated financial expertise acquired through public company chief financial officer, chief executive officer and financial, IT and internal audit roles
• CEO of a publicly traded company with international operations • Expertise in the • National Association of | ||||
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![]() | RONALD C. LINDSAY | |||
Age: 62 Director Since:2013 | Crane Co. Committees:Audit; Management Organization and Compensation | |||
Retired Chief Operating Officer of Eastman Chemical Company, Kingsport, TN (manufacturer of specialty chemicals, plastics, and fibers). Chief Operating Officer from 2013 to 2016, and Executive Vice President, Specialty Fluids and Intermediates, Fibers, Adhesives and Plasticizers Worldwide Engineering, Construction and Manufacturing Support, | ||||
Relevant Skills and Experience: • | ||||
2018 Proxy Statement 13
14 | Crane Co. |
Item 1: Election of Directors
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![]() | ELLEN McCLAIN | |||
Age: 56 2013Director Since: | Crane Co. Committees:Audit; | |||
Chief Financial Officer, Year Up, Boston, MA (not-for-profit provider of | ||||
Relevant Skills and Experience: • • Broad experience as a senior executive | ||||
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![]() | CHARLES G. McCLURE, JR. | |||
Age: 67 Director Since:2017 | Crane Co. Committees: | |||
Managing Partner of Michigan Capital Advisors, Bloomfield, MI (private equity firm investing in Tier 2 and 3 global automotive and transportation suppliers). Prior to co-founding Michigan Capital Advisors in 2014, served from 2004 to 2013 as Chairman of the Board, CEO and President of Meritor, Inc., | ||||
markets). Other Directorships: • • • | ||||
Relevant Skills and Experience: • • | ||||
14 Crane Co.
2021 Proxy Statement | 15 |
Item 1: Election of Directors
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![]() | MAX H. MITCHELL | |||
Age: 57 Director Since:2014 | Crane Co. Committees:Executive | |||
President and Chief Executive Officer of the Company since | ||||
Other Directorships: • • | ||||
Relevant Skills and Experience: • • Demonstrated expertise developing and • • Broad international and domestic M&A expertise, including successful integration of acquired companies • Extensive experience leveraging the Company’s intellectual/human capital management process to drive a performance-based culture | ||||
Continuing Directors Whose Terms Expire in 2019
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2018 Proxy Statement 15
Item 1: Election of Directors
![]() ![]() | JENNIFER M. POLLINO | |||
Age: 56 Director Since:2013 | Crane Co. Committees:Audit; Management Organization and Compensation | |||
Executive Coach and Consultant, JMPollino LLC, Charlotte, NC since 2012. Executive Vice President, Human Resources and Communications, Goodrich Corporation, Charlotte, NC (aerospace products manufacturer) from 2005 to 2012. Prior positions at Goodrich included President and General Manager of Goodrich Aerospace’s Aircraft Wheels & Brakes Division and of its Turbomachinery Products Division, and Vice President and General Manager of Goodrich Aerospace, Aircraft Seating Products. | ||||
Other Directorships: • Hubbell Incorporated since 2020
• Wesco Aircraft Holdings, Inc. | ||||
Relevant Skills and Experience: • • • | ||||
![]() | Crane Co. |
Item 1: Election of Directors
![]() | JOHN S. STROUP | |||
Age: 54 Director Since: 2020 | Crane Co. Committees: Management Organization and Compensation | |||
Executive Chairman of Belden, Inc. (global leader in signal transmission and security solutions) since 2020. Other Directorships: • Tenneco since 2020 • Rexnord Corporation since 2012 • Belden, Inc. since 2005 | ||||
Relevant Skills and Experience: • More than 30 years of experience in industrial manufacturing of highly engineered products and business strategy development • Proven leadership skills with over 15 years of experience as president, chief executive officer and director of a global leader in signal transmission and security solutions | ||||
![]() | JAMES L. L. TULLIS | |||
Age: 73 Director Since:1998 | Crane Co. Committees: | |||
Chairman, | ||||
from 1988 to the present. Other Directorships: • ATEC, Inc. since 2018 electroCore, Inc. from 2018 to 2020
• Lord Abbett & Co. Mutual Funds since • | ||||
Relevant Skills and Experience: • • | ||||
Vote Required
VOTE REQUIRED Our By-laws provide that nominees for director and directors running for re-election to the Board without opposition must receive the affirmative vote of a majority of votes cast. Any director who fails to receive the required number of votes for re-election is required by Crane Co. policy to tender his or her written resignation to the Chairman of the Board for consideration by the Nominating and Governance Committee. | ![]() |
Our By-laws provide that nominees for director and directors running for re-election to the Board without opposition must receive the affirmative vote of a majority of votes cast. Any director who fails to receive the required number of votes for re-election is required by Crane Co. policy to tender his or her written resignation to the Chairman of the Board for consideration by the Nominating and Governance Committee.
16 Crane Co.
2021 Proxy Statement | 17 |
Item 1: Election of Directors
Independent Status of Directors
Standards for Director Independence
No
The listing standards of the NYSE, as well as Crane Co.’s Corporate Governance Guidelines, require that a majority of the Board be comprised of independent directors. In order for a director qualifiesto qualify as independent, unless the Board must affirmatively determinesdetermine that the director has no material relationship with Crane Co. The Board has adopted the standards set forth below in order to assist the Nominating and Governance Committee and the Board itself in making determinations of director independence. Any of the following relationships would preclude a director from qualifying as an independent director:
The director is or was an employee, or the director’s immediate family member is or was an executive officer, of Crane Co. other than as an interim Chairman or interim CEO, unless at least three years have passed since the end of such employment relationship. | |
• | The director is an employee, or the director’s immediate family member is an executive officer, of an organization (other than a charitable organization) that in any of the last three completed fiscal years made payments to, or received payments from, Crane Co. for property or services, if the amount of such payments exceeded the greater of $1 million or 2% of the other organization’s consolidated gross revenues. |
• | The director has received, or the director’s immediate family member has received, direct compensation from Crane Co., if the director is a member of the Audit Committee or the amount of such direct compensation received during any twelve-month period within the preceding three years has exceeded $120,000 per year, excluding (i) director and committee fees and pension and other forms of deferred compensation for prior services (so long as such compensation is not contingent in any way on continued service); (ii) compensation received as interim Chairman or CEO; or (iii) compensation received by an immediate family member for service as a non-executive employee of Crane Co. |
• | The director is a current partner of or employed by, or the director’s immediate family member is a current partner of, or an employee who personally works on the audit of Crane Co. at, a firm that is the internal or external auditor of Crane Co., or the director was, or the director’s immediate family member was, within the last three years a partner or employee of such a firm and personally worked on the Crane Co. audit at that time. |
• | The director is or was employed, or the director’s immediate family member is or was employed, as an executive officer of another organization, and any of Crane Co.’s present executive officers serves or served on that other organization’s compensation committee, unless at least three years have passed since the end of such service or the employment relationship. |
• | The director is a member of a law firm, or a partner or executive officer of any investment banking firm, that has provided services to Crane Co., if the director is a member of the Audit Committee or the fees paid in any of the last three completed fiscal years or anticipated for the current fiscal year exceed the greater of $1 million or 2% of such firm’s consolidated gross revenues. |
The existence of any relationship of the type referred to above, but at a level lower than the thresholds referred to, does not, if entered into in the ordinary course of business, preclude a director from being independent. The Nominating and Governance Committee and the Board review all relevant facts and circumstances before concluding that a relationship is not material or that a director is independent. Specifically, the Committee’s evaluation process includes the review of (i) direct and indirect relationships between directors and the Company, (ii) a report of transactions with director affiliated entities, (iii) director responses to annual questionnaires, and (iv) Code of Business Conduct and Ethics compliance certifications. In addition, the Nominating and Governance Committee reviews and must approve all charitable contributions in excess of $10,000 made by the Company or its affiliatedthrough one of the following three independent charitable funds: Crane Fund, Crane Fund for Widows and Children, or Crane Foundation, to any organization for which a director or his or her spouse or other immediate family member serves as a trustee, director, or officer or in any similar capacity. There were no such contributions in 2017.2020.
Crane Co.’s Standards for Director Independence, along with its Corporate Governance Guidelines and Code of Business Conduct and Ethics, which appliesapply to Crane Co.’s directors and to all officers and other employees, including our chief executive officer, chief financial officerChief Executive Officer, Chief Financial Officer and controller,Controller, are available on our website atwww.craneco.com/governancewww.craneco.com/governance.Crane Co. intends to satisfy any disclosure requirements concerning amendments to, or waivers. See “Code of the Code of Ethics by posting such information at that website address.Business Conduct and Ethics” on page 26.
2018 Proxy Statement 17
18 | Crane Co. |
Item 1: Election of Directors
Independence of Directors
The Nominating and Governance Committee has reviewed whether any of the directors other than Mr. Mitchell, who is Chief Executive Officer of Crane Co., has any relationship that, in the opinion of the Committee, (i) is material (either directly or as a partner, stockholder, director, or officer of an organization that has a relationship with Crane Co.) and, as such, would be reasonably likely to interfere with the exercise by such person of independent judgment in carrying out the responsibilities of a director or (ii) would otherwise cause such person not to qualify as an “independent” director under the rules of the NYSE and, in the case of members of the Audit Committee and the Management Organization and Compensation Committee, the additional requirements under SectionSections 10A and 10C, respectively, of the Securities Exchange Act of 1934 and the associated rules. The Nominating and Governance Committee determined that, other than Mr. Mitchell, all of Crane Co.’s current directors and all persons who served as a director of Crane Co. at any time during 20172020 are independent in accordance with the foregoing standards, and the Board of Directors has reviewed and approved the determinations of the Nominating and Governance Committee.
In evaluating the independence of all directors, the Board considered all transactions in which the Company and any director had an interest, including all purchases and sales with other companies on which a director served on that company’s board. The Board determined in each case that such purchases and sales were de minimis, comprising less than 0.15% of the Company’s revenues. The Board evaluated these transactions that arose in the ordinary course of business and on the same terms and conditions available to other customers and suppliers. Furthermore, in reaching their determinations regarding the independence of the other directors (other than Mr. Mitchell), the Committee and the Board applied the Standards for Director Independence described above and determined that there were no transactions that were likely to affect the independence of any director’s judgment.
Board RenewalRefreshment
At the 2017 annual meeting, our stockholders voted to declassify the Board of Directors, reducing the term of office for directors from three years to one year. In connection with this change, the Corporate Governance Guidelines were amended to increase the retirement age for directors from 72 to 75. Each director who has attained the age of 75 as of the record date for an annual meeting of stockholders or who has served on the Board for 15 years, is required to tender his or her resignation from the Board. The Corporate Governance Guidelines also require a director to tender his or her resignation from the Board if there is a significant change in his or her primary job responsibilities.responsibilities that could impact the skills or perspectives they bring to the Board. The Nominating and Governance Committee then makes a recommendation to the Board, based on a review of all the circumstances, whether the Board should accept the resignation or ask the director to continue on the Board.
The Nominating and Governance Committee will, from time to time, seek to identify potential candidates for director to sustain and enhance the composition of the Board with thean appropriate balance of knowledge, experience, skills, expertise, and diversity.diversity of thought to enable Crane Co. to formulate and implement its strategic plan. In this process, the Committee will consider potential candidates proposed by other members of the Board, by management, or by stockholders, and the Committee has the sole authority to retain a search firm to assist in this process, at Crane Co.’s expense.
Once a person has been identified by the Nominating and Governance Committee as a potential candidate, the Committee, as an initial matter, may collect and review publicly available information regarding the person to assess whether the person should be considered further. Generally, if the person expresses a willingness to be considered and to serve on the Board, and the Committee believes that the person has the potential to be a good candidate, the Committee would seek to gather information from or about the person, review the person’s accomplishments and qualifications in light of any other candidates that the Committee might be considering, and, as appropriate, conduct one or more interviews with the person. In certain instances, Committee members may contact one or more references provided by the candidate or may contact other members of the business community or other persons that may have greater first-hand knowledge of the candidate’s background, skills and accomplishments. The Committee’s evaluation process does not vary based on whether or not a prospective candidate is recommended by a stockholder, although, as stated below, the Board may take into consideration the number of shares held by the recommending stockholder and the length of time that such shares have been held.stockholder.
18 Crane Co.
2021 Proxy Statement | 19 |
Item 1: Election of Directors
Board Effectiveness
Our Board of Directors, led by our Nominating and Governance Committee, evaluates the size and composition of our Board of Directors at least annually, giving consideration to evolving skills, diversity, perspective, and experience needed on our Board of Directors to perform its governance and oversight role as the business grows and evolves and the underlying risks change over time. Below are steps our Board has recently taken to proactively improve our Board effectiveness.
Nominations by Stockholders
In considering candidates submitted by stockholders, the Nominating and Governance Committee will take into consideration the needs of the Board and the qualifications of the candidate. A stockholder proposing to nominate a director must provide the followingcertain information about the nominating stockholder and the director nominee, including the following information and must update such information as of the record date for the meeting:
the number of shares of Company stock, including details regarding any derivative securities, held by the nominating stockholder and the director nominee and any of their respective affiliates or associates; | |
• | a description of any agreement regarding how the director nominee would vote, if elected, on a particular matter, including a representation that there are no other |
• | a description of any agreement with respect to compensation as a director from any person other than Crane Co., including a representation that there are no other |
• | a representation that the director nominee will comply with all publicly disclosed Board policies, including those relating to confidentiality; |
• | a completed questionnaire similar to the one required of existing directors, a copy of which the Corporate Secretary will provide upon request; |
• | a description of any material interest the nominating stockholder has in any such nomination; and |
• | any other information about the proposed candidate that would, under the Securities and Exchange Commission’s proxy rules, be required to be included in our proxy statement if the person were a nominee. |
20 | Crane Co. |
Item 1: Election of Directors
Such notice must also be accompanied by a written consent of each proposed nominee to being named as a nominee and to serve as a director, if elected. A complete description of the requirements relating to a stockholder nomination is set forth in our By-laws.
Any stockholder recommendation for next year’s Annual Meeting,annual general meeting, together with the information described above, must be sent to the Corporate Secretary at 100 First Stamford Place, Stamford, CT 06902 and, in order to allow for timely consideration, must be received by the Corporate Secretary no earliernot less than December 24, 2018, and no later90 days nor more than January 23, 2019.120 days prior to April 26, 2022.
Majority Voting for Directors and Resignation Policy
Our By-laws provide that nominees for director and directors running for re-election to the Board without opposition must receive a majority of votes cast. Any director who fails to receive the required number of votes for re-election is required by Crane Co. policy to tender his or her written resignation to the Chairman of the Board for consideration by the Nominating and Governance Committee. The Committee will consider such tendered resignation and make a recommendation to the Board concerning the acceptance or rejection of the resignation. In determining its recommendation to the Board, the Committee will consider all factors deemed relevant by the members of the Committee including, without limitation, the stated reason or reasons why stockholders voted against such director’s re-election, the qualifications of the director, and whether the director’s resignation from the Board would be in the best interests of the Company and its stockholders.
2018 Proxy Statement 19
Item 1: Election of Directors
Board’s Role and Responsibilities
The Board is responsible for, and is committed to, overseeing the business and affairs of the Company and providing guidance for sound decision making, accountability and accountability.ethical professional conduct. It reviews the performance of our management and establishes guidelines and performance targets for our executive compensation program. The Board has adopted a comprehensive set of Corporate Governance Guidelines that set forth the Company’s governance philosophy, policies, and practices, and provide a framework for the conduct of the Board’s business.
Strategic Oversight
Our Board takes an active role in overseeing management’s formulation and implementation of its strategic plan. It receives a comprehensive overview of management’s strategic plan for all of the Company’s businesses at least annually, receives regular updates from consultants and other experts on the global capital markets and industrial environment, and receives periodic updates from individual businesses at other regularly scheduled Board meetings throughout the year. The Board provides insight and feedback to senior management, and, if necessary, challenges management on the Company’s strategic direction. The Board also monitors and evaluates, with the assistance of the Chief Executive Officer, the Company’s strategic results, and approves all significantmaterial capital allocation decisions.
Risk Oversight
The Board recognizes its duty to assure itself that the Company has effective procedures for assessing and managing risks to the Company’s operations, financial position, and reputation, including compliance with applicable laws and regulations. The Board has charged the Audit Committee with responsibility for monitoring the Company’s processes and procedures for risk assessment, risk management, and compliance, includingwhich includes receiving regular reports on environmental remediation activities, and on any violations of law or Company policies and consequentresultant corrective action. The Audit Committee receives presentations regarding these matters from management at each in-person meeting (at least quarterly). The Company’s Director of Compliance and Ethics, as well as the Chief Audit Executive, has regular independent communications with the Audit Committee. The Chair of the Audit Committee reports any significant matters to the Board as part of his reports on the Committee’s meetings and activities.
2021 Proxy Statement | 21 |
Item 1: Election of Directors
The Board receives an annual presentation by management on the Company’s risk management practices. The Board also receives reports from management at each meeting regarding operating results, the Company’s asbestos liability, pending and proposed acquisition and divestiture transactions (each of which must be approved by the Board before completion), capital expenditures (material capital expenditures require Board approval), and other matters.
In addition, the Management Organization and Compensation Committee of the Board has established a process for assessing the potential that the Company’s compensation plans and practices may encourage executives to take risks that are reasonably likely to have a material adverse effect on the Company. The conclusions of this assessment are set forth in the Compensation Discussion and Analysis section under the heading “Compensation Risk Assessment” on page 47.55.
20 Crane Co.
Item 1: Election of Directors
Coordination Among Board Committees Regarding Risk Oversight
Management Succession Planning and Intellectual Capital
We have a comprehensive Intellectual Capital (“IC”) process at Crane Co. that encompasses careful and rigorous talent selection, systematic training and personalized development, and an annual assessment of performance and potential. Our Board of Directors and the Management Organization and Compensation Committee take an important role in our human capital management and the IC process. The Management Organization and Compensation Committee has the primary responsibilities for (i) assuring that the Company’s management development and succession planning policies and procedures are sound and effective, (ii) evaluating the performance of the Chief Executive Officer and other members of senior management, and (iii) regularly reporting its findings and recommendations to the Board of Directors. A key element of the IC process is the identification of management succession needs and opportunities, whether arising from natural career growth and development, voluntary turnover, retirements, or other causes. Such management succession planning forms part of our annual strategy review process for each of our businesses, and the senior management levels are reviewed with the Board annually. The Board’s oversight and involvement in the annual review of senior management level succession needs and opportunities promotes the identification and development of a pipeline of strong performance-focused senior leaders that possess diverse skills and talents.
Stockholder Engagement
The Company regularly meets with current and potential stockholders, both to provide transparency about its operations and results, and to better understand the investment community’s perception of the Company’s performance and corporate strategy. During 2017, the Company attended meetings with more than 100 different investors at conferences, during investor roadshows, and at industry events. Crane Co. also typically hosts an annual halfinvestor day investor event in New York City during the first quarter of the year to provide a thorough review of the prior year’s results, to discuss the Company’s outlook for the current year, and to review the Company’s corporate strategyportfolio and capital allocation policies.strategies. During 2020, the Company also participated in meetings, phone
22 | Crane Co. |
Item 1: Election of Directors
calls and video conference calls with approximately 120 different investors at conferences and during investor roadshows; in light of the global COVID-19 pandemic and related restrictions on travel and in-person gatherings, the substantial majority of these investor interactions during 2020 were virtual.
Our Vice President of Investor Relations and/or our Chief Financial Officer provide feedback from the investor and analyst meetings formally to the Board of Directors on a quarterly basis. Additional viewpoints and commentary from investors and analysts are incorporated into our comprehensive strategic review which is presented to the Board of Directors at least annually.
Stockholder Communications with Directors
The Board has established a process to receive communications from stockholders and other interested parties. Stockholders and other interested parties may contact any member (or all members) of the Board, any Board committee, or any Chair of any such committee by mail or electronically. To communicate with the Board of Directors, any individual director or any group or committee of directors, correspondence should be addressed to the Board of Directors or any individual director or group or committee of directors by either name or title. All such correspondence should be sent to Crane Co., c/o Corporate Secretary, 100 First Stamford Place, Stamford, CT 06902. To communicate with any of our directors electronically, stockholders should use the following e-mail address: adiorio@craneco.com.corpsec@craneco.com.
All communications received as set forth in the preceding paragraph will be opened by the office of the Corporate Secretary for the sole purpose of determining whether the contents representthey contain a message to our directors. Any contents will be forwarded promptly to the addressee unless they are in the nature of advertising or promotion of a product or service, or are patently offensive or irrelevant. To the extent that the communication involves a request for information, such as an inquiry about Crane Co. or stock-related matters, the Corporate Secretary’s office may handle the inquiry directly. In the case of communications to the Board or any group or committee of directors, the Corporate Secretary’s office will make sufficient copies of the contents to send to each director who is a member of the group or committee to which the envelope or e-mailcommunication is addressed.
2018 Proxy Statement 21
Item 1: Election of Directors
Board Leadership Structure
Our Corporate Governance Guidelines do not require that the roles of Chairman of the Board and Chief Executive Officer be held by different individuals, as the Board believes that effective board leadership structure can be highly dependent on the experience, skills, and personal interaction between persons in leadership roles.roles and the needs of the Company at the time. These leadership roles are currently filled separately by our non-executivenon-employee Chairman of the Board, R.S. Evans,James L.L. Tullis, who possesses extensive experience with the Company and its operations, and by our Chief Executive Officer, Max H. Mitchell. To assist in defining this leadership structure, the Board adopted a position description for the role of the non-executivenon-employee Chairman of the Board, which is incorporated into our Corporate Governance Guidelines. The principal duties are as follows:
Provide leadership to the Board and ensure that each director is making an appropriate contribution; | |
• | Guide the Board’s discharge of its duties, including reviewing corporate strategy, monitoring risk management and compliance activities, and evaluating senior management performance and succession planning; |
• | Maintain an effective relationship with the Chief Executive Officer and act as a liaison between the Chief Executive Officer and the Board; |
• | Chair meetings of the Board of Directors and the Annual |
• | Organize and approve the agendas for Board meetings based on input from directors and the Chief Executive Officer; and |
• | Conduct a performance evaluation of the Board. |
The Board believes thiswill continue to monitor and assess its leadership structure has affordedto ensure it best serves the needs of the Company an effective combinationand its stockholders.
2021 Proxy Statement | 23 |
Item 1: Election of Directors
Committees of the Board
The Board of Directors has established an Audit Committee, a Management Organization and Compensation Committee, and a Nominating and Governance Committee. The Board of Directors has also established an Executive Committee, which meets when a quorum of the full Board of Directors cannot be readily convened. The memberships of these committees during 2017 wereare as follows:
Audit Committee Chair M. R. Benante Members M. Dinkins | Roles and Responsibilities The Audit Committee is the Board’s principal agent in fulfilling legal and fiduciary obligations with respect to matters involving Crane Co.’s accounting, auditing, financial reporting, internal control, and legal compliance functions. The Audit Committee has the authority and responsibility for the appointment, retention, compensation, and oversight of our independent auditors. Independence All members of the Audit Committee meet the independence and expertise requirements of the | |
22 Crane Co.
Item 1: Election of Directors
Management Organization and Chair J. M. Pollino Members D. G. Cook | | Roles and Responsibilities The duties of the Management Organization and Compensation Committee include: coordinating the annual evaluation of the Chief Executive Officer; recommending to the Board of Directors all actions regarding compensation of the Chief Executive Officer; approving the compensation of other executive officers and reviewing the compensation of other officers and business unit presidents; reviewing director compensation; administering the annual incentive compensation plans and stock incentive plan; reviewing and approving any significant changes in or additions to compensation policies and Independence All members of the Management Organization and Compensation Committee meet the independence requirements of the |
24 | Crane Co. |
Item 1: Election of Directors
Nominating and Governance Committee Chair D. G. Cook Members M. R. Benante |
Roles and Responsibilities The duties of the Nominating and Governance Committee include developing criteria for selection of and identifying potential candidates for service as directors, policies regarding tenure of service and retirement for members of the Board, Independence All members of the Nominating and Governance Committee meet the independence requirements of the |
Executive Committee Chair J.L.L. Tullis Members D. G. Cook |
2018 Proxy Statement 23M. H. Mitchell
Item 1: Election of Directors
Roles and Responsibilities The Board of Directors has also established an Executive Committee, which meets when a quorum of the full Board of Directors cannot be readily convened. The Executive Committee may exercise any of the powers of the Board of Directors, except for approving an amendment of the Certificate of Incorporation or | ||
2021 Proxy Statement | 25 |
Item 1: Election of Directors
Executive Sessions of Non-Management Directors
Three
Eight of the meetings of the Board during 20172020 included executive sessions without management present, presided over by R. S. Evans,James L.L. Tullis, Chairman of the Board. Crane’s Corporate Governance Guidelines require our non-management directors to meet in executive session without management on a regularly scheduled basis, but not less than two times a year. The Chairman of the Board presides at executive sessions, unless he or she is a member of management, in which case the presiding person at executive sessions rotates on an annual basis among the Chairs of the Nominating and Governance Committee, the Audit Committee, and the Management Organization and Compensation Committee. If the designated person is not available to chair an executive session, then the non-management directors select a person to preside.
Board Meetings and Attendance
The Board of Directors met eightnine times during 2017.2020, including two special meetings. Each director attended over 80%100% of the Board and Committee meetings held in the period during which he or she was a director and Committee member. In addition, it is Crane Co.’s policy that each of our directors attend the Annual Meeting;our annual meetings either in person or telephonically; all members of the Board were present at the 20172020 annual meeting except Ms. Pollino, who was unable to attend due to illness.meeting.
Board and Committee Evaluation Process
Board and committee evaluations play a critical role in ensuring the effective functioning of the Board. It is essential to monitor the Board, committee, and individual director performance and consider and act upon the feedback provided by each Board member. The Nominating and Governance Committee, in consultation with the Chairman of the Board, is charged with overseeingfacilitating an annual self-assessment of the Board’s performance, as well as an annual self-assessment undertaken by each committee of the Board. The multi-stepmultistep evaluation process begins with a questionnaire, and includes one-on-one discussions with the Chairman and individual Board members, and one-on-one discussions withbetween Committee Chairs and the members of eachtheir respective committee. The results are provided to the full Board, and the Board’s policies and practices are updated as appropriate to reflect director feedback.
24 Crane Co.
Item 1: Election of Directors
Director Education
It is important for directors to stay current and informed on developments in corporate governance best practices in order to effectively discharge their duties. Our directors are provided updates on corporate governance developments at regularly scheduled board meetings receive a focused, in-house governance and compliance training session annually, and are encouraged to participate in programs offered by nationally recognized organizations that specialize in director education. The Company reimburses its directors for their reasonable costs and attendance fees to participate in such programs.
Code of Business Conduct and Ethics
Crane Co. is committed to conducting its business in compliance with all applicable laws, rules and regulations and in accordance with the highest standards of business ethics. Accordingly, the Directors, officers and all Company employees are required to act in accordance with Crane Co’s Code of Business Conduct and Ethics. Our Code of Business Conduct and Ethics covers many areas of professional ethical conduct, including the protection and proper use of Company assets, confidentiality, conflicts of interest, compliance with laws and fair dealing with competitors, employees and other Company stakeholders. A copy of the Code of Business Conduct and Ethics is available on our website at www.craneco.com/governance.
26 | Crane Co. |
Item 1: Election of Directors
Conflicts of Interest; Transactions with Related Persons
Crane Co. has established two Conflict of Interest Policies: CP-103, to which all officers and salaried employees are subject, and CP-103D, to which non-employee directorsDirectors are subject. Those who are subject to the policies are required to disclose to the General Counsel in writing each outside relationship, activity, and interest that creates a potential conflict of interest, including prior disclosure of transactions with third parties. The General Counsel will determine whether the matter does or does not constitute an impermissible conflict of interest, or may in his or her discretion refer the question to the Nominating and Governance Committee, which will review the facts and make a recommendation to the Board. All directors, executive officers, and other salaried employees are required to certify in writing each year whether they are personally in compliance with CP-103 or CP-103D, as applicable, and whether they have knowledge of any other person’s failure to comply. In addition, each director and executive officer is required to complete an annual questionnaire which calls for disclosure of any transactions above a stated amount in which the director or officer or any member of his or her family has a direct or indirect material interest. The Board of Directors is of the opinion that these procedures in the aggregate are sufficient to allow for the review, approval, or ratification of any “Transactions with Related Persons” that would be required to be disclosed under applicable Securities and Exchange Commission rules.
Company Policy Regarding Hedging Transactions
Crane Co.’s Policy on Trading in Company Stock prohibits members of the Board or Directors, executive officers, and certain other employees designated as “Employee Insiders” (generally, employees involved in compiling or having access to monthly operating forecasts or other Company-wide financial information) from engaging in any hedging transactions. The policy applies to any transaction that allows the individual to continue to own the covered securities, but without the full risks and rewards of ownership, such as zero-cost collars and forward sale contracts. The policy applies to any Company stock owned by the individual, whether acquired through equity compensation awards or otherwise.
Corporate Governance Documents
The Board of Directors has adopted Corporate Governance Guidelines which reflect the Board’s commitment to monitor the effectiveness of policy-making and decision-making at both at the Board and management level,levels, with a view to enhancing long-term stockholder value. The Corporate Governance Guidelines are available on our website atwww.craneco.com/investors/corporate-governancewww.craneco.com/GovernanceGuidelines.
Copies of the charters of the Board committees are available on our website atwww.craneco.com/CharterAudit; www.craneco.com/CharterAudit; www.craneco.com/CharterCompensation; and andwww.craneco.com/CharterNominating, respectively.
2018 Proxy Statement 25
2021 Proxy Statement | 27 |
Item 1: Election of Directors
Corporate Governance and Sustainability
We value global diversity, respect human rights and the rule of law, and recognize environmental management among our highest priorities throughout the corporation. In embracing this important topic, we have established a senior management committee and created a management position to identify and track metrics on philanthropy, sustainability and equality. This committee publishes a separate report on the Company’s efforts and performance with respect to philanthropy, sustainability, and equality, which can be found at www.craneco.com/pse. In addition to the details to be found in that report, following are examples of our actions and policies aimed at health and safety, philanthropy, diversity and inclusion, protecting the environment, governance and ethics, and supply chain management.
![]() Health & Safety | • Strongly committed to the health and safety of our associates, and strive to continuously reduce the incidence and severity of job-related injuries • Utilize safe technologies, training programs, effective risk management practices, and sound science in our operations to minimize risk to our associates |
![]() Philanthropy | • Embrace philanthropy around the world, providing paid time off to our associates from their work schedules to volunteer and support charitable causes important to our local teams • Annually facilitate the donation of more than $17 million through three independent charitable funds (the largest of which is also our largest shareholder), to former associates in need, to local organizations in the communities where our businesses operate, and in support of important global relief efforts |
![]() Diversity & Inclusion | • Commitment to diversity on our Board of Directors, and across our global workforce, with a focus on developing an inclusive and high-performance culture with trust and respect • Focused development for our associates leveraging a structured intellectual capital process with constructive reviews and various talent/leadership development initiatives endorsed by the executive management team |
![]() Protecting the Environment | • Comply with all applicable environmental laws governing the use, storage, discharge, and disposal of hazardous or toxic material • Seek to improve the operation of our facilities through the efficient use of energy and sustainable use of renewable resources, and commitment to waste reduction, recycling, reducing water usage and carbon emissions, and implementing responsible waste disposal practices |
![]() Governance & Ethics | • Annual review of Corporate Governance Guidelines by the Board of Directors and outside experts • Code of Business Conduct and Ethics adopted by our Board of Directors, as well as anti-bribery policies, and policies prohibiting the Company from engaging in the political process (associates, however, are encouraged to participate in the political process privately if they wish, on their own time and using their own resources) • Mandatory annual training for associates on ethics and anti-bribery • Maintain an actively managed, anonymous ethics hotline |
![]() Supply Chain Management | • Regularly audit and assess our supply chain • Maintain a strict supplier code of conduct that sets expectations about supplier behavior with respect to compensation, hours of labor, coercion and harassment, discrimination, workplace safety, environmental protection, and commercial bribery |
28 | Crane Co. |
Item 1: Election of Directors
Director Compensation Program
Our director compensation program is reviewed annually by the Management Organization and Compensation Committee’s independent consultant and all changes are intended to align the program with the peer group median. From April through December 2020, the directors each voluntarily took 20% temporary reductions in the cash component of the annual retainer to assist the Company’s efforts to reduce expenses during the COVID-19 pandemic. The members of the Board of Directors, other than Mr. Mitchell (who does not receive compensation for his services as a director), receive the following compensation:compensation, which does not reflect the voluntary temporary reductions in 2020:
No meeting fees will be paid unless the total number of meetings exceeds three more than the regularly scheduled meetings of the Board of Directors and the relevant committees. The compensation of Mr. Mitchell, who is Chief Executive Officer in addition to having been a director since January 31, 2014, is shown in the Summary Compensation Table on page 52.60.
Mr. Evans,Tullis, the non-executivenon-employee Chairman of the Board, receives the same annual retainer as a non-employee director plus an incremental retainer of $110,000,$125,000 per year, payable in cash (or up to 100% in DSUs or fully vested shares, at the election of the Chairman), pursuant to an agreement under which the Company also provides him with an office, office assistant and technical support. Prior to the 2017 annual meeting, the incremental retainer was $100,000.. The Company also has a time-sharing agreement with Mr. EvansTullis under which he is permitted personal use of the corporate aircraft, for which he reimburses the Company the aggregate incremental cost. See “Other Arrangements with our Named Executive Officers—Use of Company Aircraft” on page 49.58.
Deferred Stock Units
The Management Organization and Compensation Committee, which is composed solely of independent directors, has the primary responsibility for reviewing and considering any revisions to our director compensation program. The Management Organization and Compensation Committee undertook its annual review of the type and form of compensation paid to our non-employee directors in connection with their service on the Board and its committees for fiscal year 2020, and considered the results of an independent analysis completed by Frederic W. Cook & Co., Inc. (“FW Cook”). As part of this analysis, FW Cook reviewed non-employee director compensation trends and data from companies comprising the same compensation peer group used by the Management Organization and Compensation Committee in connection with its review of executive compensation. Pursuant to this compensation review process, and after considering FW Cook’s advice on industry best practice regarding the timing of equity grants, the Committee determined that no changes in director compensation were required this year, and approved the current retainers for Board members and Committee Chairpersons and members for 2021, as set forth above. In addition, the Management Organization and Compensation Committee reviewed FW Cook’s advice, including peer group data and the substantive role of the Chairman of the Board, similarly determined that no change was required in the Chairman’s compensation this year, and approved the Chairman’s current compensation of $125,000 for 2021.
DSUs are issued each year as of the date of the annual meeting; are forfeitable if the director ceases to remain a director until Crane Co.’s next annual meeting, except in the case of death, disability, or change in control; and entitle the director to receive an equivalent number of shares of Crane Co. stock, plus accumulated dividends, upon the director’s ceasing to be a member of the Board. In April 2017,2020, each non-employee director received DSUs pursuant to this plan:plan as follows: Mr. EvansMcClure, Jr., received 3,9153,294 DSUs, one director who had elected to receiveMr. Stroup joined the entire retainer in DSUsBoard of Directors on December 8, 2020, and received 2,503727 DSUs, and the remaining non-employee directors each received 1,5402,506 DSUs.
2021 Proxy Statement | 29 |
Item 1: Election of Directors
Stock Ownership Guidelines for Directors
The Board of Directors has adopted stock ownership guidelines whichthat require each director to hold shares of Crane Co. stock having a fair market value not less than five times the cash portion of the annual retainer for directors currently $75,000.(currently $85,000). A director must have attained this ownership level by the fifth anniversary of his or her first election as a director. As of the Record Date, all directors who had attained their fifth anniversary of service were in compliance with this ownership guideline, and each other director is making what the Board of Directors believes to be reasonable progress towards compliance with this ownership guideline.
26 Crane Co.
Item 1: Election of Directors
Director Compensation in 20172020
The following table shows the actual compensation in 20172020 of all directors except for Mr. Mitchell, our Chief Executive Officer, whose compensation is shown in the Summary Compensation Table on page 52.60. As noted above, from April through December 2020, the directors voluntarily took 20% temporary reductions in the cash component of the annual retainer to assist the Company’s efforts to reduce expenses during the COVID-19 pandemic. See “Compensation of Directors” on page 29, for more details on compensation approved for directors in 2020 prior to the voluntary reductions.
Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1) | Total ($) | ||||||
M. R. Benante | $ | 83,750 | $ | 125,525 | $ | 209,275 | |||
E. T. Bigelow | $ | 95,750 | $ | 141,430 | $ | 237,180 | |||
D. G. Cook | $ | 96,250 | $ | 141,430 | $ | 237,680 | |||
R. S. Evans | $ | — | $ | 328,977 | $ | 328,977 | |||
R. C. Lindsay | $ | 63,750 | $ | 134,853 | $ | 198,603 | |||
P. R. Lochner, Jr. | $ | 91,250 | $ | 149,199 | $ | 240,449 | |||
E. McClain | $ | 91,250 | $ | 130,591 | $ | 221,841 | |||
C. G. McClure, Jr. | $ | 59,167 | $ | 120,695 | $ | 179,862 | |||
J. M. Pollino | $ | 91,250 | $ | 130,591 | $ | 221,841 | |||
P. O. Scannell | $ | 7,500 | $ | 202,606 | $ | 210,106 | |||
J. L. L. Tullis | $ | 88,750 | $ | 141,430 | $ | 230,180 |
Name | Fees Earned or Paid in Cash(1) ($) | Stock Awards(2) ($) | Total ($) | ||||
M. R. Benante | 87,919 | 135,023 | 222,942 | ||||
D. G. Cook | 82,333 | 135,023 | 217,356 | ||||
M. Dinkins | 72,750 | 135,023 | 207,773 | ||||
R. C. Lindsay | 47,750 | 135,023 | 182,773 | ||||
E. McClain | 75,250 | 135,023 | 210,273 | ||||
C. G. McClure, Jr. | 38,581 | 177,481 | 216,062 | ||||
J. M. Pollino | 80,250 | 135,023 | 215,273 | ||||
J. S. Stroup | 0 | 53,325 | 53,325 | ||||
J. L. L. Tullis | 131,667 | 135,023 | 266,690 |
(1) | Amounts in this column include the cash value of vested shares of Crane Co. common stock received in lieu of cash retainers at the election of the director. Mr. Stroup earned fees totaling $4,871 in connection with his interim appointment that were paid in cash during the first week of January 2021. | |
(2) | Amounts shown in this column reflect the grant date fair value |
• | 2,506 DSUs to each of Messrs. Benante, | |
• | An aggregate of | |
The grant date fair value of each DSU granted on April 24, 2017 was $77.91. The assumptions on which this valuation is based are set forth in Note 12 to the audited financial statements included in Crane Co.’s annual report on Form 10-K filed with the Securities and Exchange Commission on February 27, 2018.
At December 31, 2017,2020, each non-employee director held the following number of vested and unvested DSUs:
11,445 | ||
23,969 | ||
4,102 | ||
19,550 | ||
15,135 | ||
8,371 | ||
15,135 | ||
727 | ||
2018 Proxy Statement 27
30 | Crane Co. |
Item 2: Ratification of the Selection of Auditors
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ITEM 2: RATIFICATION OF THE SELECTION OF AUDITORS | ||
![]() | PROPOSAL 2 | The Board recommends votingFOR theRatification of the Selection of Deloitte & Touche LLP as the Company’s independent auditors for | |
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The Board of Directors proposes and recommends that the stockholders ratify the Audit Committee’s selection of the firm of Deloitte & Touche LLP as independent auditors for Crane Co. for 2018.2021. Deloitte & Touche LLP has been Crane Co.’s independent auditor since 1979. Although ratification of this selection is not required by law, the Board of Directors believes it is desirable as a matter of corporate governance. If the stockholders do not ratify the selection of Deloitte & Touche LLP, the Audit Committee will reconsider the appointment of Deloitte & Touche LLP as Crane Co.’s independent auditor. We expect that representatives of Deloitte & Touche LLP will attend the Annual Meeting, where they will have an opportunity to make a statement if they wish to do so and to respond to appropriate questions.
Unless otherwise directed by the stockholders, proxies that are properly executed and returned or submitted electronically will be voted for approval of the ratification of Deloitte & Touche LLP to audit our consolidated financial statements for 2018.2021.
Annual Evaluation and Selection of Auditors
The Audit Committee is responsible to select, in its sole discretion, the firm of independent auditors to audit Crane Co.’s financial statements for each fiscal year. The Committee is also directly responsible for the appointment, compensation, retention, and oversight of the work of the independent auditors, including resolution of any disagreements whichthat arise between management and the auditor regarding financial reporting or other audit, review or attest services for the Company. The independent auditors report directly to the Audit Committee.
The Committee annually reviews and evaluates the performance of the Company’s independent auditors. In evaluating the independent auditors, the Audit Committee considers, among other things, the quality of the independent auditor’s service, the sufficiency of its resources, its independence and objectivity, and the length of time the firm has been engaged as Crane Co.’s independent auditors.
Principal Accounting Firm Fees
Set forth below is a summary of the fees paid for the years ended December 31, 20172020, and 20162019 to Crane Co.’s principal accounting firm, Deloitte & Touche LLP, the member firms of Deloitte Touche Tohmatsu, and their respective affiliates:
2017 | 2016 | |||||
(in thousands) | ||||||
Audit fees(a) | $ | 5,545 | $ | 6,869 | ||
Audit-related fees(b) | $ | 400 | $ | 279 | ||
Tax fees(c) | $ | 784 | $ | 552 | ||
All other fees(d) | $ | 2 | $ | 2 | ||
Total | $ | 6,731 | $ | 7,702 |
2020 | 2019 | ||
(in thousands) | |||
Audit fees(a) | $5,700 | $5,756 | |
Audit-related fees(b) | 241 | 215 | |
Tax fees(c) | 1,014 | 1,491 | |
All other fees(d) | 7 | 3 | |
Total | $6,962 | $7,465 |
(a) | Audit services consisted of: (i) audit of Crane Co.’s annual financial statements; (ii) reviews of Crane Co.’s quarterly financial statements; (iii) Sarbanes-Oxley Act, Section 404 attestation matters; and (iv) statutory and regulatory audits, comfort letters, consents, and other services related to Securities and Exchange Commission matters. |
(b) | Audit-related services consisted of: (i) benefit plan audits; (ii) agreed-upon procedures reports; and (iii) financial accounting and reporting consultations. |
28 Crane Co.
2021 Proxy Statement | 31 |
Item 2: Ratification of the Selection of Auditors
(c) | Fees for tax compliance services totaled |
(d) | Fees for all other services billed consisted of fees for software licenses. |
2017 | 2016 | ||||
Ratio of tax planning and advice fees and all other fees to audit fees, | |||||
audit-related fees and tax compliance fees | 2.6 | % | 1.6 | % | |
Percentage of non-audit services approved by the Audit Committee | 100 | % | 100 | % |
2020 | 2019 | ||
Ratio of tax planning and advice fees and all other fees to audit fees, audit-related fees, and tax compliance fees | 8% | 10% | |
Percentage of non-audit services approved by the Audit Committee | 100% | 100% |
Pre-Approval Policy and Procedures
Securities and Exchange Commission rules under the Sarbanes-Oxley Act of 2002 prohibit independent auditors of public companies from providing certain non-audit services, and require that other non-audit services be approved by the Audit Committee. The Company’s policy implementing this requirement has been in place since January 2003. That policy:
specifies certain types of services that our independent auditors are prohibited from performing; | |
requires that management prepare a budget for non-prohibited services at the beginning of each | |
requires that any expenditure outside of the budget also be approved by the Audit Committee in advance. |
Vote Required
VOTE REQUIRED Ratification of the selection of the auditors requires the affirmative vote of a majority of the votes cast on this question at the Annual Meeting by holders of shares of common stock present in person or represented by proxy and entitled to vote at the meeting. (See Questions and Answers About These Proxy Materials and the Annual Meeting, page 87). | ![]() |
Approval of the above resolution requires the affirmative vote of a majority of the votes cast on this question at the Annual Meeting of Stockholders by holders of shares of common stock present in person or represented by proxy and entitled to vote at the meeting. (See Questions and Answers about These Proxy Materials and the Annual Meeting, page 76).
In accordance with its written charter adopted by the Board of Directors, the Audit Committee (the “Committee”) assists the Board of Directors in fulfilling its responsibility for oversight of the quality and integrity of the accounting, auditing, and financial reporting practices of Crane Co. All of the members of the Committee qualify as “independent” under the provisions of Section 10A of the Securities Exchange Act of 1934 and the rules of the Securities and Exchange Commission thereunder.
The members of the Committee are not professionally engaged in the practice of auditing or accounting and are not, and do not represent themselves to be, performing the functions of auditors or accountants. Members of the Committee rely without independent verification on the information provided to them and on the representations made by management and the independent auditors. Accordingly, the Committee’s oversight does not provide an independent basis to determine that management has maintained appropriate accounting and financial reporting principles or appropriate internal controls and procedures designed to assure compliance with accounting standards and applicable laws and regulations. Furthermore, the Committee’s considerations and discussions referred to below do not assure that the audit of Crane Co.’s financial statements has been carried out in accordance with the standards of the Public Company Accounting Oversight Board (United States), that the financial statements are presented in accordance with generally accepted accounting principles, or that Crane Co.’s auditors are in fact “independent.”
32 | Crane Co. |
Item 2: Ratification of the Selection of Auditors
In discharging its oversight responsibility as to the audit process, the Committee:
received the written disclosures and the letter from the independent auditors required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent auditors’ communications with the Committee concerning independence; |
2018 Proxy Statement 29
Item 2: Ratification of the Selection of Auditors
discussed with the independent auditors their independence, and any activities that may impact their objectivity and independence, including fees for non-audit services, and satisfied itself as to the auditors’ independence; | |
received a report on the quality control procedures of the independent auditors; | |
received and discussed a report on critical audit matters; | |
• | discussed with management, the internal auditors, and the independent auditors the quality and adequacy of Crane Co.’s internal controls, with particular focus on compliance with Section 404 of the Sarbanes-Oxley Act of 2002, as well as the internal audit function’s organization, responsibilities, budget, and staffing; |
reviewed with the independent auditors and the internal auditors their respective audit plans and audit scope; | |
reviewed with management the risk assessment and risk management procedures of Crane Co., including cybersecurity risk, as well as the procedures and findings of Crane Co.’s compliance program; | |
discussed the results of the internal audit examinations; | |
discussed with the independent auditors the matters required to be discussed | |
discussed and reviewed, both with and without members of management present, the independent auditors’ examination of the financial statements. |
The Committee reviewed the audited financial statements of Crane Co. as of and for the year ended December 31, 2017,2020, with management and the independent auditors. Management is responsible for the preparation, presentation, and integrity of Crane Co.’s financial statements, Crane Co.’s internal controls and financial reporting process and the procedures designed to assure compliance with accounting standards and applicable laws and regulations. Crane Co.’s independent auditors are responsible for performing an independent audit of Crane Co.’s financial statements and expressing an opinion as to their conformity with generally accepted accounting principles.
Based on the above-mentioned review and discussions with the independent auditors, the Committee recommended to the Board of Directors that Crane Co.’s audited financial statements be included in its Annual Report on Form 10-K for the year ended December 31, 2017,2020, for filing with the Securities and Exchange Commission.
The Committee approved a policy regarding services by Crane Co.’s independent auditors, effective January 1, 2003. Under this policy, the independent auditors are prohibited from performing certain services in accordance with Section 202 of the Sarbanes-Oxley Act of 2002. With respect to non-prohibited services to be provided by the independent auditors, the policy requires that a budget for such services be prepared by management and approved by the Committee at the beginning of each fiscal year, and any expenditure outside of the budget must also be approved by the Committee in advance. Pursuant to this policy, the Committee reviewed and approved the budget for the audit and other services to be provided by Deloitte & Touche LLP in 2018.2021. The Committee also approved the reappointment of Deloitte & Touche LLP to serve as independent auditors; the Board of Directors concurred in such appointment and directed that this action be presented to stockholders for ratification.
Submitted by:
The Audit Committee of the
Board of Directors of Crane Co.
E. Thayer Bigelow, Chair
Martin R. Benante, Chair
Michael DinkinsPhilip R. Lochner, Jr.Ronald C. Lindsay
Ellen McClainCharles G. McClure, Jr.
Jennifer M. Pollino
Incorporation by Reference.The Audit Committee Report in this Proxy Statement shall not be deemed incorporated by reference by any general statement incorporating by reference this Proxy Statement into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, and shall not be deemed filed under those Acts, except to the extent that Crane Co. specifically incorporates any such matter in a filed document by reference.
30 Crane Co.
2021 Proxy Statement | 33 |
Item 3: Advisory Vote on Compensation of Named Executive Officers
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ITEM 3: ADVISORY VOTE ON COMPENSATION OF NAMED EXECUTIVE OFFICERS | ||
![]() | PROPOSAL 3 | The Board recommends voting FORtheAdvisory Vote to Approve the Compensation of our Named Executive Officers | |
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Based on the recommendation of stockholders at the Company’s 2017 annual meeting of stockholders, and the Board’s consideration of that recommendation, the Company has determined that it will hold a non-binding advisory vote to approve the compensation paid by the Company to its named executive officers every year, until the next required stockholder vote to recommend the frequency of such votes. Accordingly,votes in 2023. In accordance with the requirements of Section 14A of the Securities Exchange Act of 1934 and the related Securities and Exchange Commission rules, we are asking stockholders to express their opinion on the compensation of the named executive officers in 2017,2020, as described in the pages that follow in this Proxy Statement. This vote is non-binding and advisory, however, the Board will give due consideration to the opinion of the Company’s stockholders as expressed by their vote.
We believe that the compensation of our executive officers should be:
closely linked to the performance of the Company as a whole, the executive’s business unit (as applicable), and the individual executive; | |
aligned with the Company’s annual operating plan and long-term strategic plans and objectives; | |
attractive in the markets in which we compete for executive talent; and | |
structured so as to reward actions in accordance with the Company’s values and standards and to discourage the taking of inappropriate risks, and thereby to uphold Crane Co.’s high standards of business ethics and corporate governance. |
The Compensation Discussion and Analysis beginning on page 3335 explains in detail the elements of the Company’s executive compensation program with respect to our “named executive officers,” and the steps taken by the Company to ensure that the program, as implemented in 2017,2020, was aligned with these core principles. Balancing annual and long-term compensation elements, the program directly links incentive compensation for executives with increases in stockholder value, principally by means of annual cash bonuses based on achievement of performance goals set by the Management Organization and Compensation Committee at the beginning of the year, performance-based restricted share units whichthat vest in accordance with the Company’s total stockholder return relative to the S&P Mid-CapMidcap 400 Capital Goods Group over a three yearthree-year period, and stock options and time-based restricted share units that vest over a four-year period. The Company believes that this system, as put into practice under the supervision of the Management Organization and Compensation Committee, is instrumental in enabling the Company to achieve superior financial performance and investor returns. In light of the impact of the COVID-19 pandemic on the Company’s business and the global economy in general, the Management Organization and Compensation Committee has used these principles to guide its decisions related to executive compensation, with a focus on supporting the business decisions and leadership actions required during this unprecedented time.
2018 Proxy Statement 31
Item 3: Advisory Vote on Compensation of Named Executive Officers
The Board strongly endorses the Company’s actions in this regard, and recommends that stockholders vote for the following resolution:
RESOLVED, that the 20172020 compensation of the named executive officers as disclosed in the Proxy Statement is approved.approved by the stockholders on an advisory basis.
Unless otherwise directed by the stockholders, proxies that are properly executed and returned will be voted for the resolution.
Vote Required
Approval Abstentions and broker non-votes will not count as votes for or against the proposal and will not be included in calculating the number of votes in favor of the above resolution requires the affirmative vote of a majority of the votes cast on this question at the Annual Meeting of Stockholders by holders of shares of common stock present in person or represented by proxy and entitled to vote at the meeting. (See Questions and Answers about These Proxy Materials and the Annual Meeting, page 76.) In accordance with the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and the related Securities and Exchange Commission rules, the resolution is non-binding and advisory; however, the Board will give due consideration to the opinion of the Company’s stockholders as expressed by their votes.proposal.
32 Crane Co.
VOTE REQUIRED Approval of the above resolution requires the affirmative vote of a majority of the votes cast on this question at the Annual Meeting by holders of shares of common stock present in person or represented by proxy and entitled to vote at the meeting. (See “Questions and Answers About These Proxy Materials and the Annual Meeting”, beginning on page 87.) | ![]() |
34 | Crane Co. |
COMPENSATION DISCUSSION AND ANALYSIS | ||
Compensation Discussion and Analysis
We believe that compensation should be directly linked to performance and highly correlated to stockholder value. This section of the Proxy Statement explains how, under the guidance of our Management Organization and Compensation Committee (the “Committee” or “Compensation Committee”), our executive compensation program is designed and operated with respect to our “named executive officers” or “NEOs”,“NEOs,” whose compensation is set forth in the Summary Compensation Table and other compensation tables contained in this Proxy Statement:
Max H. Mitchell | President and Chief Executive Officer | |
Richard A. Maue | Senior Vice President | |
Senior Vice President | ||
Senior | ||
Vice President, General Counsel and Secretary | ||
Alejandro Alcala | Senior Vice President |
SECTION | PAGE |
EXECUTIVE SUMMARY | 36 |
This section details compensation highlights and business activities in the past year that have an impact on compensation, and a high level overview of our compensation practices. We also address the impact of the COVID-19 pandemic on Company performance results for 2020. | |
COMPENSATION PRINCIPLES | 42 |
This section describes our pay for performance philosophy and the principles by which our Compensation Committee has designed the incentive compensation programs. | |
ELEMENTS OF COMPENSATION AND 2020 DECISIONS | 42 |
This section provides a detailed description of the elements that make up our compensation program and the rationale behind the metrics and corresponding performance targets. We also explore the principal conclusions for the Committee’s decisions, including a discussion on the impact of the COVID-19 pandemic. | |
COMPENSATION DECISION-MAKING PROCESS | 52 |
This section outlines roles, responsibilities, and the process behind compensation decisions, as well as the means by which our peer group is reviewed and selected. | |
POLICIES AND PRACTICES RELATED TO OUR EXECUTIVE COMPENSATION PROGRAM | 55 |
This section details our compensation risk assessment and varying policies in place to reinforce our good compensation governance. | |
OTHER ARRANGEMENTS WITH OUR NAMED EXECUTIVE OFFICERS | 57 |
This section describes other important agreements between Crane Co. and the NEOs. |
2021 Proxy Statement | 35 |
Compensation Discussion and Analysis
Executive Summary
During 2017,
Fiscal year 2020 was a difficult year for the global economy and our business primarily due to the unprecedented impacts and significant disruptions caused by the ongoing COVID-19 pandemic. The pandemic had a substantial impact on demand for most of our businesses and related end markets, and that impact was completely beyond the control of management. The pandemic related demand destruction was so severe that comparison of actual 2020 results to our original 2020 plan and financial targets, as developed in late 2019 and approved by the Board in early 2020, is not meaningful.
The COVID-19 pandemic and related uncertainty also posed unique and substantial challenges for our normal forecasting and budgeting methodologies throughout 2020. Those challenges were so significant that most U.S. public industrial companies withdrew financial guidance in the spring of 2020. However, consistent with our desire to be fully transparent with our stockholders, we metpublicly revised and updated all elements of our typical financial guidance with additional details and granularity on April 27, 2020, concurrent with the release of our first quarter 2020 financial results. Furthermore, we continued to update our views and outlook at each of our successive quarterly earnings calls in July and October. While actual financial results for 2020 fell short of our initial guidance, they compared favorably to our April 27, 2020 revised guidance, and reflected extremely strong execution. Specifically, the reduction in demand related to COVID-19 was unavoidable, but decremental margins (change in adjusted operating profit divided by change in sales) excluding the impact of acquisitions of 35% were impressive given the magnitude of the sales decline and the highly negative business and product mix. Further, free cash flow declined materially less than either adjusted operating profit or exceeded our financial objectives, delivering solidadjusted earnings per share (EPS), reflecting effective working capital management and controlled capital expenditures.
Despite this strong operational performance, while continuing to position Crane Co. for long-term stockholder value creation. This performance drove Crane Co.’s stock price higher, with 2017 total stockholder return above(share price appreciation plus reinvested dividends) (TSR) trailed that of the most relevant benchmark stock index.indices on a one- and three-year basis. We believe that underperformance is primarily attributable to our exposure to two end markets that were among the most negatively impacted by the COVID-19 pandemic, and for which investors had substantial concerns about the short- and medium-term outlook: commercial aerospace, and the process industries which include oil & gas.
Crane Co. 2017 TSR Better than Benchmark Indicesfor Periods Ending December 31, 2020
Given
Consistent with the Committee’s consistentcontinued focus on aligning pay with performance, and despite the extraordinary circumstances in 2020, all variable elements of management’s compensation increaseddeclined compared to 2017,2019, reflecting the improved business performance shortfalls relative to target, and total stockholder returnlower three-year relative TSR compared to the prior year.
2018 Proxy Statement 33
Lower variable compensation for management in 2020 appropriately reflects our recent financial performance. However, we are proud of our response to the unprecedented set of circumstances we faced during 2020, particularly related to the actions we took to ensure the safety and well-being of our associates, and where possible, to retain them through the pandemic. Starting in early March, we quickly adopted new safety protocols and procedures worldwide, in most cases more stringent than, and in advance of, government mandates. We also quickly adopted a new Emergency Pandemic Exception Pay (EPE) program providing two weeks of additional paid time off to all associates globally that were directly or indirectly impacted by the pandemic above and beyond normal vacation and sick pay. The EPE program provided
36 | Crane Co. |
Compensation Discussion and Analysis
2017
substantial flexibility for our associates, and it could be used to cover paid time off for associates diagnosed with COVID-19 or required to quarantine, for those who had to stay at home to care for children due to school or day care closure, and to ensure continuity of pay and benefits where Crane manufacturing facilities or offices were required to close because of local health regulations.
As the year progressed, we did take some difficult measures to adjust our cost base to lower demand levels, and gross cost savings totaled approximately $105 million. These actions included temporary base pay reductions for all executive officers and directors, discretionary cost reductions where possible, and a reduction-in-force in businesses to align our workforce size with expected demand levels. However, every possible effort was made to protect our remaining associates as much as possible during this challenging period. For example, none of our businesses mandated unpaid furloughs in the United States, we did not implement any salary reductions (except for executive officers and directors), we maintained all benefits including our 401(k) match in the United States, and we continued with our annual merit salary increase process. Further, in recognition of the extraordinary effort shown by our associates around the world, and because the financial impact of COVID-19 was beyond our associates’ control, all associates normally eligible to receive an annual bonus received a minimum payout at 50% of their target. We followed this approach because we believed it was the fair and appropriate way to treat our associates for their efforts in working through the pandemic to satisfy our customers and other Company stakeholders, and to build lasting goodwill and morale which we believe will assist with associate retention in the years ahead.
2020 Performance Highlights
Continued
Executed Well in a Difficult Period
From a financial perspective, we believe that we were on-track to Execute on Near-Term Priorities in 2017
In 2017,meet or exceed our 2020 financial targets before the Company delivered strongpandemic hit, consistent with our commentary at our February 27, 2020 annual Investor Day event. While the final 2020 financial results were below our original financial targets for the year, we believe that exceededthe shortfall was entirely related to the impact of COVID-19, and that our operating plan objectives. Specifically:operational performance and execution against long-term strategic objectives were excellent considering the unexpected market related challenges arising from the pandemic.
• | Adjusted operating profit in 2020 declined 35% compared to 2019. Excluding the impact of acquisitions, decremental margins (change in adjusted operating profit divided by change in sales) of 35%, were an impressive result given the magnitude of the sales decline and the highly negative business and product mix, reflecting extremely strong operational execution. Adjusted earnings per |
• | Free cash flow |
2021 Proxy Statement | 37 |
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Compensation Discussion and Analysis
See “Non-GAAP Reconciliation” beginning on page 84 for more detail regarding Special Items impacting EPS, free cash flow and operating margins, as well as a reconciliation of the non-GAAP measures used herein.
Continued to PursueExecute Against Consistent Long-Term Strategy
Despite COVID-19 challenges during 2020, our long-term strategy remains unchanged. Crane Co. is a diversified manufacturer of highly engineered industrial products. We choose to compete in markets where we have competitive differentiation and scale. We will continue to leverage our resources as an integrated operating company, and to reinvest in our three large global growth platforms—platforms – Fluid Handling, Payment & Merchandising Technologies, and Commercial Aerospace—Aerospace & Electronics – both organically and through strategic acquisitions. We believe that this strategy will enable us to deliver above-median, strong free cash flow and EPS growth over time.
We will continue to execute this strategy while remaining committed to the values of our founder, R.T. Crane, who resolved to conduct business “in the strictest honesty and fairness; to avoid all deception and trickery; to deal fairly with both customers and competitors; to be liberal and just toward employees; and to put my whole mind upon the business.”
34 Crane Co.
Compensation Discussion and Analysis
With this framework, we continued to position the Company for long-term sustainable growth in 2017. Specificduring 2020 with some significant accomplishments, includedincluding the following:
ACQUISITION ACTIVITY
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Our funnel of acquisition targets remains robust, and we continue to actively pursue acquisitions across all three of our global growth platforms, with a priority focus on Fluid Handlings and Aerospace & Electronics.
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Compensation Discussion and Analysis
NEW PRODUCT DEVELOPMENT
We successfully introduced a number of new products and solutions across our portfolio during 2019 and 2020. Among others:
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• | The process valve business within our Fluid Handling segment continued to expand the breadth of its product portfolio, successfully launching products to broaden its valve portfolio, and continuing to commercialize other products launched over the last few years including new polypropylene-lined large diameter pipe product line, a range of metal seated ball valves, a family of digital pressure transmitters, and a truck cab air suspension valve. Outside of the process business, our Building Services & Utilities business continues to expand its MK3 line of pressure independent control valves, and our Crane Pumps & Systems business continues to expand its portfolio of SITHE chopper and BLADE grinder pump products. |
PROGRESS ON SHARE GAIN INITIATIVES
We gained share across most of our portfolio during 2020. Some notable examples:
• | At Aerospace & Electronics, the commercial side of the business had an extremely challenging 2020 with consumer and business travel dramatically reduced as a result of COVID-19, and aircraft production rates further reduced by the prolonged agency recertification process for the high-volume Boeing 737 MAX. However, the defense business had an outstanding year, delivering high-teens sales growth which was well in excess of market growth rates, driven by continued share gains in our Defense Power and Microwave businesses, as well as continued product shipments to key military programs from our Landing, Fluid and Sensing businesses. | |
• | At Payment & Merchandising Technologies, we | |
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• | At Fluid Handling, we believe that the 2020 core sales decline of 15% was entirely attributable to COVID-19 related market weakness, and that share gains mitigated the sales decline by more than 150 basis points, with notable progress across our process valve, pumps and controls businesses. Share gains were driven primarily by recent new product |
CONTINUED PROACTIVE REPOSITIONING ACTIONS Compensation Discussion and Analysis Taken together, we believe Compensation Framework The mix of target total direct compensation (base salary, target annual incentive awards, and long-term incentive awards) for
Chief Executive Officer Totals may not sum due to rounding. Other NEOs Totals may not sum due to rounding.
Compensation Discussion and Analysis Pay for Performance Alignment Strong Correlation Annual Bonus Directly Tied to Crane’s EPS and Free Cash Flow
PRSU
Table of
Compensation Best Practices The Committee is firmly committed to implementing a compensation program that aligns management and stockholder interests, encourages executives to drive sustainable stockholder value creation, and helps retain key personnel. Key elements of our pay practices are set forth in the Proxy Summary and explained in more detail in the “Policies and Practices Related to
We believe that compensation should be directly linked to performance and highly correlated to stockholder value. The principles that guide us as we make decisions involving executive compensation are that compensation should be:
We also believe that it is important for our NEOs and other executives to have an ongoing long-term investment in the Company as outlined below under “Stock Ownership We design our performance-based incentive compensation so that variation in performance will result in meaningful variation in the earned compensation paid to our NEOs and other key executives. Thus, actual compensation amounts will vary above or below targeted levels depending on performance of the Company and/or business unit and achievement of individual performance goals.
Elements of Compensation and 2020 Decisions The following table summarizes the major elements of our executive officer compensation program.
Compensation Discussion and Analysis The compensation decisions and metrics made and set by the Committee for fiscal year 2020 were established in January 2020, prior to and long before we could anticipate the
Base Salary Base salary is fixed compensation paid to each executive for performing normal duties and responsibilities. We determine the amount at the date of hire based on competitive market data, current salary levels within the Company, and the Base salaries for certain executive officers were increased effective January All NEOs and certain other members of the Company’s senior management team took a voluntary temporary reduction in their base salaries from April through December 2020 (20% for the CEO and 10% for all other executive officers, which reductions are reflected in the chart below),
Note: For comparison, base salaries approved by the Committee for 2019 were $1,004,250 for Mr. Mitchell, $640,000 for Mr. Maue, $470,000 for Mr. Gallo, and $430,000 for Mr. D’Iorio. Mr. Alcala was not an NEO for proxy reporting in 2020.
Compensation Discussion and Analysis Annual Incentive Compensation We pay our executive officers cash bonuses based on the attainment of Company and business unit performance goals established Early in the year, the Committee establishes and approves the annual target bonus objectives and award opportunities for each of our named executive officers, subject to review and approval by the Board in the case of the Chief Executive Officer. In making Our Chief Executive Officer and other officers participate in the discussions regarding annual incentive objectives so they can provide their input and understand the expectations of each incentive plan component. Each participating executive receives a confirmation of his or her annual bonus objectives and payout range after it has been approved by the The Committee reviews the performance results for the Annual Incentive Plan, including Company and business unit results and individual performance, at its regularly scheduled January meeting, which is generally the first meeting following the end of the Company’s fiscal
Compensation Discussion and Analysis Annual Incentive Objectives for Performance metrics for In January 2020, prior to the beginning of
The graphs below show the performance targets and related ranges set by the Committee in
Compensation Discussion and Analysis Performance Targets and Bonuses for Operations NEOs in For Messrs. The performance metrics for Messrs. Gallo and Alcala were established by the Committee prior to and long before we could have anticipated the global disruption and impact of the COVID-19 pandemic. Kurt Gallo, Senior Vice President Throughout 2020 and during the unanticipated COVID-19 pandemic, Mr. Gallo undertook additional responsibilities that merited consideration by the Compensation Committee. While leading the Payment & Merchandising Technologies segment and assuming responsibility for Engineered Materials, Mr. Gallo also acted as President of Crane Currency for seven months, guiding Crane Currency to substantially over-deliver on its 2020 plan, achieving a 200% payout. Mr. Gallo also led the consolidation of Merchandising Systems into Crane Payment Innovations and led the integration of the recently acquired Cummins-Allison business. Based on the performance targets described above, the impact of the COVID-19 pandemic on the actual results achieved in 2020 for Mr. Gallo’s businesses, and in recognition of Mr. Gallo’s leadership actions during the pandemic and the additional responsibilities undertaken by Mr. Gallo, the Committee approved a 100% payout for Mr. Gallo.
Alejandro Alcala, Senior Vice President The performance metrics approved by the Committee for Mr. In March 2020, Mr. Alcala was elevated to the position of Senior Vice President and in April assumed responsibility for the entirety of our Fluid Handling businesses and operations in China, India and the Middle East & Africa, prior to which he had been President of Crane ChemPharma & Energy (“CPE”) business. Mr. Alcala, for a period of six months, continued to serve as Acting President of CPE until a successor was appointed and simultaneously led the integration of Instrumentation & Sampling and fulfilling his segment leader responsibilities.
Compensation Discussion and Analysis Based on the performance targets described above, the impact of the COVID-19 pandemic on the actual results achieved in 2020 for Mr. Alcala’s businesses, and in recognition of Mr. Alcala’s leadership actions during the pandemic and the additional responsibilities undertaken by Mr. Alcala during 2020, the Committee approved a 50% positive adjustment and also awarded Mr. Alcala a cash bonus of $50,000, in recognition of his additional duties as Acting President of CPE. The discretionary adjustment to 50%, plus the additional cash bonus in recognition of Mr. Alcala’s dual role, resulted in a total adjusted payout of 65.9%.
Named Executive Officers’ Bonuses for In January During the sustained downturn, Crane’s executive leaders implemented health and safety protocols across all our offices, manufacturing and distribution facilities, well in advance of CDC guidance, to protect Crane associates. These protocols included proper hygiene, social distancing, mask use and temperature screenings. In addition, we provided emergency pandemic compensation to Crane associates affected by the pandemic. The newly adopted Emergency Pandemic Exception Pay (EPE) program provides two weeks of additional paid time off to all associates globally that were directly or indirectly impacted by the pandemic above and beyond normal vacation and sick pay. The EPE program provides substantial flexibility for our associates, and it can be used to cover paid time off for associates diagnosed with COVID-19 or required to quarantine, for those who had to stay at home to care for children due to school or day care closure, and to ensure continuity of pay and benefits where Crane manufacturing facilities or offices were required to close because of local health regulations. The Crane associates’ employee benefit programs, including our 401(k) match in the United States, and our annual merit salary increases that were approved and awarded in January 2020 were not rolled back during the pandemic. In addition to the implementation of health and safety measures, senior management also quickly accessed the capital markets to reinforce the Company’s balance sheet, ahead of a predicted tightening of credit markets, thereby increasing the capacity of our credit facilities and lowering our overall cost of debt. Our senior leaders worked diligently, undertaking company-wide measures to reduce our expenses. These measures included voluntary base pay reductions at the executive officer level (20% for the CEO and 10% for all other executive officers), and 20% voluntary reductions in the cash component of the annual retainer for each of our non-employee Directors, all from April through December. The foregoing, among various other actions implemented by senior management during the sustained downturn, enabled the Company to emerge from the pandemic in a position of strength.
Compensation Discussion and Analysis As in prior years, the Compensation Committee relied on adherence to our core compensation principles and plan design to guide its decisions related to 2020 incentive plan bonuses, with a focus on supporting the business decisions and leadership required during this unprecedented time while still taking into account the impact of the COVID-19 pandemic on our stockholders. In lieu of making mid-year plan adjustments during the ongoing pandemic, the Committee instead chose to exercise its discretion at the low end of target range. The formulaic calculations resulted in
Long-Term Equity Incentive Compensation The Stock Incentive Plan is used to provide long-term incentive compensation through stock options and The Committee determined an overall target dollar value for long-term equity incentive awards for each of the named executive officers. In determining these amounts, the Committee considered the competitive market data compiled by FW Cook, Company and individual performance in 2020, and our historical grant practices including the number of shares and the fair market value of the stock. The Committee then allocated the total target dollar amount among the applicable award types, as follows: for our Chief Executive Officer, 60% as PRSUs and 40% as stock options; and for each of the other named executive officers, 50% as PRSUs, 35% as stock options, and 15% as TRSUs. To determine the target number of PRSUs and the number of stock options and TRSUs, the Committee divided the applicable dollar amount by the closing price of our common stock for the PRSUs and TRSUs and by the Black-Scholes accounting value for the stock options (rounded in each case to the nearest whole share) on the date the awards were approved. Despite the fact that the Company was on track to deliver above plan performance in 2020 prior to the COVID-19 pandemic, and notwithstanding the quick and decisive actions undertaken by management to preserve and protect the Company and its associates, during the sustained economic downturn caused by the pandemic, the Committee chose not to exercise its discretion to modify the previously granted long-term incentive compensation awards, and maintained the awards and the metrics as they had been granted.
Compensation Discussion and Analysis The table below sets forth, for each of our named executive officers, the dollar value used by the Committee and resulting number of shares
PRSU Awards – 3-Year Performance Period Based on Relative TSR The Committee
The vesting of PRSUs awarded to members of the senior leadership team in January For TSR between the 25th and 50th percentiles and between the 50th and 75th percentiles, the vesting is interpolated on a
Compensation Discussion and Analysis
Stock Option Awards – Vest 25% Per Year Over Four Years Under the Stock Incentive Plan, stock options must be granted with a per-share exercise price at no less than fair market value on the date of grant and are subject to vesting terms as established by the Committee
TRSU Awards – Vest 25% Per Year Over Four Years The Stock Incentive Plan also authorizes the Committee to grant time-based restricted share units, or
Retirement Benefits
Messrs. The NEOs also participate in our Benefit Equalization Plan, which is designed only to restore retirement benefits under the Company’s regular defined benefit pension plan that are limited by the tax code; there is no supplemental benefit based on deemed service or enhanced compensation formulas. Benefits accrued under this plan are not funded or set aside in any manner. In the event of retirement at age 62 with 10 years of service, a participating executive would be eligible to receive benefits under that plan without the reduction factor set forth in the Company’s tax-qualified pension plan of three percent per year prior to age 65. The Other Compensation The “All Other Compensation” and “Change in Pension Value and Nonqualified Deferred Compensation Earnings” columns of the Summary Compensation Table and the accompanying footnotes set forth the details of other compensation received by the named executive officers. In certain cases, such as the Crane Co. contributions to defined contribution plans and the increase in actuarial value of the defined benefit pension, such compensation is determined on the same basis as that used for all other employees. In other cases, such as automobile allowances, executive health exams, cybersecurity protection in the executive’s home network environment, and other personal benefits, the compensation is only provided to certain key employees (including the named executive officers), and we have determined it to be reasonable and competitive compensation for the named executive officers in relation to general industry practices. For example, our named executive officers are eligible for reimbursement for the cost of their executive physicals bi-annually, subject to an expense cap of $2,500. This benefit provides our named executive officers with additional flexibility to proactively manage their health and wellness. Our executives bear all taxes associated with such benefits.
Compensation Discussion and Analysis In the case of personal use of the corporate aircraft, this benefit is restricted to the Chief Executive Officer and the Chairman of the Board. Our Chief Executive Officer, Mr. Mitchell, has an agreement with Crane Co. pursuant to which he is not required to reimburse the Company for personal use until the aggregate incremental cost reaches $100,000, and thereafter he is required to reimburse the Company for all incremental cost incurred above that amount. The net incremental cost to Crane Co. above the reimbursed amount is included in the “All Other Compensation” column of the Summary Compensation Table. The Board of Directors has approved this personal use of the aircraft for Mr. Mitchell because the Board believes that such personal use of the aircraft permits the most efficient use of time by Mr. Mitchell and thereby benefits Crane Co. For more information regarding the use of the Company aircraft, see Compensation Decision-Making Process Committee’s Role The Committee is responsible for oversight of our executive compensation program. With respect to the compensation of our Chief Executive Officer, the Committee determines his compensation, subject to review and approval by the Board of Directors. With respect to our other executive officers, the Committee determines their compensation after reviewing the recommendations of the Chief Executive Officer. The Committee administers the Annual Incentive Plan, reviewing and setting the performance targets for the The Committee is assisted in these responsibilities by its independent compensation consultant, FW Cook. Although Crane Co. pays the fees and expenses of FW Cook, the firm is retained by the Committee. FW Cook does not perform any other compensation related services for Crane Co. The Committee reviews the independence of FW Cook each year and has concluded that its work for the Committee has not raised any conflict of interest. Role of CEO and Management The Chief Executive Officer and certain other senior corporate officers play an important role in supporting the Committee in the discharge of its responsibilities. Management maintains records and provides historical compensation data to the Committee and FW Cook, as well as the annual operating plan and the actual performance results from which annual bonuses are determined. The Chief Executive Officer, together with other senior corporate officers, presents recommendations to the Committee regarding performance targets under the Annual Incentive Plan and long-term equity incentives under the Stock Incentive Plan. The Chief Executive Officer and other officers participate in the discussions regarding annual and long-term incentive objectives so they can provide their input and understand the expectations for each incentive plan component.
Compensation Discussion and Analysis Compensation Consultant and Each year, FW Cook reviews the Company’s compensation peer group against certain size-related metrics and alignment with the Company’s business segments and complexity of operations. When and as appropriate, FW Cook proposes the addition of other companies to the compensation peer group to replace companies that have been acquired or made substantial changes to their business
FW Cook provides the Committee with comparative compensation data on the peer companies from publicly available sources and, in addition, comparative compensation data compiled from The Company’s comparator group for PRSUs granted in January of 2020 is the S&P Midcap 400 Capital Goods Group, consisting of approximately 40 companies, with roughly a quarter of those companies in our compensation peer group. The Committee selected the larger comparator group for PRSU purposes based on the view (with which FW Cook concurs) that a larger group is appropriate for measuring relative TSR over a three-year period because (1) company size is less relevant for TSR comparisons than benchmarking target pay levels, (2) the larger group best represents the universe of companies with which Crane competes for investor capital and (3) it is less likely to be meaningfully affected by the loss of constituent companies during the period. In addition, the S&P Midcap 400 Capital Goods Group is a regularly published listing with all the necessary data to make the required calculations.
Compensation Discussion and Analysis CEO Assessment Process and Principal Conclusions Each year, the Chief Executive Officer proposes a set of goals and objectives for himself, which are reviewed and approved by the Board as part of an annual self-assessment and review process managed by the Committee. The goals and objectives include quantitative goals based on the annual operating plan and related metrics, as well as certain qualitative objectives relating to business strategy, organization, and intellectual capital development. At the end of each year, our Chief Executive Officer prepares and delivers to the Committee a self-assessment of his performance during that year, with reference to the goals and objectives established at the beginning of the year as well as challenges and opportunities that arose during the year. This self-assessment is shared with the other members of the Board of Directors, and their responses and other observations are compiled by the Chair of the Committee and discussed with our Chief Executive Officer, who then responds to the full Board.
Compensation Discussion and Analysis
The Committee took these observations into account, along with the competitive data supplied by FW Cook, in approving Mr. Mitchell’s bonuses for A similar process is followed for each of the Company’s other NEOs except that it is the Chief Executive Officer who reviews the self-assessment by such executive officer and provides the conclusions and findings that help guide the compensation decisions affecting such officer; for the other NEOs, annual incentive compensation, though largely formula-based, is subject to adjustment by the CEO, and subject to review and approval by the Committee, based on assessment of individual performance. Say-on-Pay Vote in In accordance with the Dodd-Frank Act and related rules adopted by the Securities and Exchange Commission, we presented a “Say-on-Pay” item to stockholders in Changes to On December 8, 2020, the Compensation Committee approved an adjustment to the 2021 composition of long-term incentive compensation for the CEO and other executive officers (including the NEOs), to more closely align with the Company’s Peer Group median compensation design based on data supplied by FW Cook, the
Policies and Practices Related to Compensation Risk Assessment The Committee has established a process for assessing the potential that our compensation plans and practices may encourage our executives to take risks that are reasonably likely to have a material adverse effect on the Company. A senior management team led by the Vice
Compensation Discussion and Analysis Stock Ownership Guidelines The Company’s stock ownership guidelines for executive officers
Shares that count toward the satisfaction of the guidelines are (i) shares owned by the executive, (ii) shares held in the executive’s 401(k) account, and (iii) the after-tax value (65%) of TRSUs held by the executive. Neither unearned or unvested PRSUs nor unexercised stock options count for purposes of the guideline. The policy permits executives to sell up to 50% of the net shares realized upon an option exercise or vesting of RSUs (i.e., the total shares covered by the option exercised or the RSU grant vesting less the number of shares surrendered to pay the exercise price and satisfy tax withholding obligations), while retaining at least 50% of such net shares in order to meet the stock ownership guidelines. Once such guidelines are met, the policy permits executives to sell any shares held above the required ownership guidelines.
Policies with Respect to Timing of Stock-Based Awards and Exercise Price of Stock Options Annual grants of stock options and RSUs to executive officers are made at the Committee’s regular January Policy with Respect to Hedging and Pledging of Company Stock
Certain forms of hedging or monetization transactions allow an individual to lock in much of the value of his or her stock holdings, often in exchange for all or part of the potential for upside appreciation in the stock, allowing the benefit of continued ownership of the stock without the full risks and rewards of ownership. When that occurs, the individual may no longer have the same objectives as the Company’s other shareholders. For this reason, the Board Clawback Policy The Company’s Compensation “Clawback” Policy provides a means for the recovery of certain incentive compensation awards if the Company’s financial statements are restated due to fraud or similar misconduct by any executive officers. Under the
Table of Compensation Discussion and Impact of Internal Revenue Code Section 162(m) Internal Revenue Code Section 162(m) limits the deductibility of compensation in excess of $1 million paid to any one NEO in any calendar year. Under the tax rules in effect before 2018, compensation that qualified as “performance-based” under Section 162(m) was deductible without regard to this $1 million limit. In 2017 and prior years, the Committee designed awards under the Annual Incentive Plan, as well as PRSUs and stock options granted under equity incentive plans, that were intended to qualify for this performance-based compensation exception. However, the Tax Cuts and Jobs Act (TCJA), which was signed into law December 22, 2017, eliminated this performance-based compensation exception effective January 1, 2018, subject to a special rule that “grandfathers” certain awards and arrangements that were in effect on or before November 2, 2017. As a result, compensation that the Committee structured in 2017 and prior years with the intent of qualifying as performance-based compensation under Section 162(m) that is paid on or after January 1, 2018, may not be fully deductible, depending on the application of the special grandfather rules. Moreover, from and after January 1, 2018, compensation awarded in excess of $1 million to our NEOs generally will not be deductible. While the
Other Arrangements with Change in Control Provisions Each of the Company’s executive officers has an agreement As set forth below under “Potential Payments upon Termination or Change in Control,” the aggregate payments to the named executive officers under the change in control agreements, including the estimated value of continuation for three years (or until normal retirement age) of the individual’s medical coverage and other benefits, had a change of control taken place on December 31, 2020, and had employment been terminated immediately thereafter, would range from Indemnification Agreements Crane Co. has entered into indemnification agreements with Mr. Mitchell, each other director, Messrs. Maue,
Compensation Discussion and Analysis Use of Company Aircraft Crane Co. has entered into time share agreements with
Management Organization and Compensation Committee Report The Management Organization and Compensation Committee of the Board of Directors has submitted the following report for inclusion in this Proxy Statement: The Committee has reviewed and discussed with management the Compensation Discussion and Analysis set forth in this Proxy Statement. Based on our review and discussions with management, the Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement, and incorporated by reference in Crane Co.’s Annual Report on Form 10-K for the year ended December 31, Submitted by: The Management Organization and Compensation
Donald G. Cook
Annual Compensation of the Named Executive Officers This discussion should be read together with the Base Salary— The annual base
Stock The grants were made pursuant to the Option Awards— In January Non-Equity Incentive Plan Compensation— In January Other Compensation— The amounts appearing in the Summary Compensation Table under the caption “All Other Compensation” are disaggregated in footnote 5 to the table.
The table below summarizes the compensation for
2020 Executive Compensation Tables
The following table gives further details of In the table below, the rows labeled “Annual Incentive Plan” disclose target bonuses set in February
Note that the amount shown in the Summary Compensation Table for The rows labeled “Performance RSU” disclose the target numbers of shares
In no event will the aggregate value of the shares earned exceed four times the value of the target number of shares determined at the beginning of the performance period. The column headed “Grant Date Fair Value” shows the grant date fair value of the Performance RSUs, calculated using a formula based on the probability of various outcomes. This amount also appears in the Summary Compensation Table under the heading “Stock Awards”;
The rows labeled “Stock Option” disclose the number of shares underlying stock options granted in January
2020 Executive Compensation Tables
The following table provides information on all exercises of stock options, and all vestings of The value realized on exercise of options is computed by multiplying the number of shares acquired upon exercise by the difference between the market price of the shares on the applicable exercise date (calculated as the closing price on that date, or, if the shares received were concurrently sold, as the price actually obtained), and the exercise price of the options. The value realized on vesting of TRSUs and PRSUs is computed by multiplying the number of shares by the closing price on the applicable vesting date.
The following table shows for each named executive officer, as of December 31,
2020 Executive Compensation Tables
Employees Hired Prior to 2006 (defined benefit)— All employees of Crane Co. hired before January 1, 2006, including Messrs. Mitchell Effective January 1, 2013, all executive officers and other employees who were participants in the pension plan receive annual pension benefits payable under the pension plan equal to 1-2/3% per year of service of the participant’s average annual compensation during the five highest compensated consecutive years (prior to 2013) of the 10 years of service immediately preceding retirement less 1-2/3% per year of service of the participant’s Social Security benefit, up to a maximum deduction of 50% of the Social Security benefit. Compensation for purposes of the pension plan is defined as total W-2 compensation plus employee contributions made under salary reduction plans
2020 Executive Compensation Tables other expense allowances; (ii) cash and noncash fringe benefits (including automobile allowances); (iii) moving expenses (including “home allowances”); (iv) deferred compensation; (v) welfare benefits; (vi) severance pay; (vii) amounts realized from the exercise of a non-qualified stock option or the sale, exchange or other disposition of stock acquired under a qualified stock option; and (viii) amounts realized when restricted stock (or property) held by the employee is recognized in the employee’s taxable income under Section 83 of the Internal Revenue Code. However, the tax code limits the total compensation taken into account for any participant under the pension plan. That limit was
Benefit Equalization Plan— The NEOs also participate in the Benefit Equalization Plan, a non-qualified, non-elective deferred compensation plan. Under the Benefit Equalization Plan, participating executives receive a benefit intended to restore retirement benefits under the Company’s regular pension plan that are limited by the Internal Revenue Code cap on the amount of compensation that can be considered in determining benefits under tax-qualified pension plans. There is no supplemental benefit based on deemed service or enhanced compensation formulas. Benefits accrued under this plan are not funded or set aside in any manner. The NEOs with defined benefit accounts in this plan are Mr. See “Nonqualified Deferred Compensation Benefits” below, regarding certain employer contributions to the Benefit Equalization Plan for the year The table below sets forth the number of years of credited service and the present value at December 31,
Nonqualified Deferred Compensation Benefits The Benefit Equalization Plan was amended effective January 1, 2014, to add a defined contribution component that restores the tax-limited portion of the non-matching company contribution under the Company’s 401(k) plan. That benefit is currently three percent of a participant’s annual salary plus bonus in excess of the Internal Revenue Code compensation limit that applies under the 401(k) plan. Contributions earn interest during a plan year at a rate equal to the average 10-year Treasury Constant Maturities for the month of December immediately preceding such plan year. The contributions become vested based on the participant’s years of service at the rate of 20% per year over five years. Vested contributions, as adjusted for interest, are payable in a lump sum cash payment six months after termination of employment. The following table shows information about the participation by each named executive officer in the Benefit Equalization Plan with respect to this employer contribution. The named executive officers do not participate in any other defined contribution nonqualified deferred compensation plans.
2020 Executive Compensation Tables 2020 Nonqualified Deferred Compensation
Potential Payments Upon Termination or Change in Control The named executive officers would have received certain payments or other benefits in the following circumstances, assuming that each had taken place on December 31,
Such payments or other benefits would be due to the named executive officers under the following plans and agreements: Severance Pay Our stated severance policy is to pay salaried employees one week per year of service upon termination of employment by Crane Co. for the convenience of Crane Co.; however, our prevailing practice on severance in the case of executive officers is to pay the executive an amount equal to one year’s base salary, either in a lump sum or by continuation of biweekly payroll distributions, at the election of the executive, with medical, dental, and other welfare benefits and retirement benefits continuing during such period. Under this practice, if each of the named executive officers had been terminated by Crane Co. for the convenience of Crane Co. as of December 31,
2020 Executive Compensation Tables Stock Options
If the then unvested stock options of each of the named executive officers had become exercisable as of December 31,
Restricted Share Units and Performance Restricted Share Units
2020 Executive Compensation Tables If the then unvested RSUs (including PRSUs) owned by each of the named executive officers had become vested as of December 31,
Benefit Equalization Plan Each of the named executive officers participates in the Benefit Equalization Plan described
Change in Control Agreements Each of the named executive officers has an agreement Upon termination within three years after a change in control, by Crane Co. without “Cause” or by the employee with “Good Reason” (as defined in the agreement), the employee is immediately entitled to a proportionate amount of the greater of the last year’s bonus or the average bonus paid in the three prior years, plus three times the sum of his or her annual salary and the greater of the last year’s bonus or the average of the previous three years’ bonuses. All accrued deferred compensation and vacation pay, employee benefits, medical coverage, and other benefits also continue for three years (or until normal retirement) after termination. “Cause” under the change in control agreements generally includes, among other things, personal dishonesty or certain breaches of fiduciary duty; repeated, willful, and deliberate failure to perform the executive’s specified duties; the commission of a criminal act related to the performance of duties; distributing proprietary confidential information about the Company; habitual intoxication by alcohol or other drugs during work hours; or conviction of a felony. “Good Reason” under the change in control agreements includes, among other things, any action by Crane Co.
2020 Executive Compensation Tables If a change in control had taken place on December 31,
Aggregate Benefit Amounts The table below reflects the estimated aggregate compensation that each of the named executive officers would receive in the event of his voluntary resignation, involuntary termination, normal retirement at age 65, death or disability, change in control, and termination following a change in control. The amounts shown assume that such termination was effective as of December 31,
As of December 31, The following briefly describes the process we used to identify our median employees for 2020, based on our employee population as of December 31, 2020: We used a statistical sampling technique to identify
2020 Executive Compensation Tables In accordance with SEC rules, our sampling of the worldwide group excluded all employees located in The CEO pay ratio reported above is a reasonable estimate calculated in a manner consistent with SEC rules based on the methodologies and assumptions described above. SEC rules for identifying the median employee and determining the CEO pay ratio permit companies to use a wide range of methodologies, estimates, and assumptions. As a result, the CEO pay ratios reported by other companies, which may have employed other permitted methodologies or assumptions and which may have a significantly different work force structure from ours, are likely not comparable to our CEO pay ratio. Equity Compensation Plan
Includes 317,655 restricted share units (“RSUs”), 122,340 deferred stock units (“DSUs”) and 371,614 performance-based restricted share units (“PRSUs”), assuming the maximum potential payout percentage. Actual numbers of shares may vary, depending on actual performance. If the PRSUs included in this total vest at the target performance level as opposed to the maximum level, the aggregate awards outstanding would be 3,476,324. Column (b) does not take RSUs, PRSUs or DSUs into account because they do not have an exercise price.
The Company’s current stock incentive plan, The 2018 Plan originally authorized the issuance of 6,500,000 shares of stock pursuant to awards under the plan. As of January 31, 2021, there were approximately 2,952,911 shares available for future grants under the 2018 Plan. The Company is seeking stockholder approval of the 2018 Amended & Restated Plan, which increases the share pool by approximately 1,757,089 shares, by authorizing the issuance of up to 4,710,000 shares of Crane Co. stock from and after February 1, 2021, plus any shares added to the share pool as a result of the expiration, forfeiture or termination of certain outstanding awards in accordance with the
As discussed in the Compensation Discussion and Analysis above, Crane Co.’s stock incentive program is used to provide long-term incentive compensation and to retain highly regarded employees and non-employee directors. The Board of Directors believes that Crane Co.’s stock incentive program is an integral part of our approach to long-term incentive compensation, focused on stockholder return, and our continuing efforts to align stockholder and management interests. We believe that growth in stockholder value depends on, among other things, our continued ability to attract and retain employees, in a competitive workplace market, with the experience and capacity to perform at the highest levels. The Board The
Principal Provisions of Crane Co. 2018 Amended & Restated Stock Incentive Plan The principal features of the 2018 Amended & Restated Plan are summarized below. The following summary of the 2018 Amended & Restated Plan does not purport to be a complete description of all of the provisions of the 2018 Amended & Restated Plan. This summary of the terms of the 2018 Amended & Restated Plan is qualified in its entirety by reference to the text of the plan, a copy of which appears as Appendix A to this Proxy Statement. Except as noted below, the terms of the 2018 Amended & Restated Plan are substantially similar to the terms of the 2018 Plan, as originally approved by our stockholders.
Item 4: Proposal to Approve the 2018 Amended & Restated Stock Incentive Plan Key Features of the 2018 Amended & Restated Plan
Consistent with the 2018 Plan, the following features of the 2018 Amended & Restated Plan will protect the interests of our stockholders:
Administration The 2018 Eligibility Participants in the 2018 Amended & Restated Plan are non-employee directors of the Company, and such key employees of Crane Co. and its subsidiaries as the Management Organization and Compensation Committee may designate. As of February Shares Available As described in the Introduction,
INVESTOR INFORMATION Visit our website atwww.craneco.comwhere you will find detailed information about the Company, its business segments and its financial performance. All of this information, including annual reports, SEC filings, earnings, news and dividend releases, can be bookmarked, printed or downloaded from this site. You may automatically receive email notification of Crane Co. news, SEC filings, and daily closing stock price by clicking “Investors” and then “Investor Alerts” atwww.craneco.com. Once your name has been added to our distribution list, the Company will automatically email you news and information as it is released.
ELECTRONIC DELIVERY OF PROXY MATERIALS Shareholders can elect to receive Proxy Materials (proxy statement, annual report and proxy card) over the internet instead of receiving paper copies in the mail. If you are a registered shareholder and wish to consent to electronic delivery of Proxy Materials, you may register your authorization at www.computershare.com/You can locate your account number on your stock certificate, dividend check or plan statement.
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Annual Meeting of Stockholders April
The undersigned does hereby appoint and constitute This proxy also covers all shares, if any, for which the undersigned has the right to give voting instructions to Vanguard Fiduciary Trust Company, Trustee of the Crane Co. Savings and Investment Plan. If voting instructions for such Savings and Investment Plan shares are not received by the proxy tabulator by April You are encouraged to specify your choices by marking the appropriate boxes (SEE REVERSE SIDE), but you need not mark any boxes if you wish to vote in accordance with the Board of Directors’ recommendations. The Proxies cannot vote your shares unless you sign and return this card or use the toll-free telephone number or internet website on the reverse side. This proxy, when properly executed, will be voted in the manner directed herein. If no direction is made, this proxy will be voted FOR election of all nominees, (Items to be voted appear on reverse side)
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Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title.
INVESTOR INFORMATION Visit our website atwww.craneco.comwhere you will find detailed information about the Company, its business segments and its financial performance. All of this information, including annual reports, SEC filings, earnings, news and dividend releases, can be bookmarked, printed or downloaded from this site. You may automatically receive email notification of Crane Co. news, SEC filings, and daily closing stock price by clicking “Investors” and then “Investor Alerts” at
ELECTRONIC DELIVERY OF PROXY MATERIALS Shareholders can elect to receive Proxy Materials (proxy statement, annual report and proxy card) over the internet instead of receiving paper copies in the mail. If you are a registered shareholder and wish to consent to electronic delivery of Proxy Materials, you may register your authorization at www.computershare.com/You can locate your account number on your stock certificate, dividend check or plan statement.
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Annual Meeting of Stockholders April
The undersigned does hereby appoint and constitute This proxy also covers all shares, if any, for which the undersigned has the right to give voting instructions to Vanguard Fiduciary Trust Company, Trustee of the Crane Co. Savings and Investment Plan. If voting instructions for such Savings and Investment Plan shares are not received by the proxy tabulator by April You are encouraged to specify your choices by marking the appropriate boxes (SEE REVERSE SIDE), but you need not mark any boxes if you wish to vote in accordance with the Board of Directors’ recommendations. The Proxies cannot vote your shares unless you sign and return this This proxy, when properly executed, will be voted in the manner directed herein. If no direction is made, this proxy will be voted FOR election of all nominees, FOR Proposals 2, 3 and 4. (Items to be voted appear on reverse side)
Important Notice Regarding the Availability of Proxy Materials for the Under Securities and Exchange Commission rules, you are receiving this notice that the proxy materials for the annual stockholders’ meeting are available on the Internet. Follow the instructions below to view the materials and vote online or request a copy. The items to be voted on and location of the Annual Meeting are on the reverse side. Your vote is important! This communication presents only an overview of the more complete proxy materials that are available to you on the Internet. We encourage you to access and review all of the important information contained in the proxy materials before voting. The proxy statement and annual report to stockholders are available at:
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Crane Co.’s Annual Meeting of Stockholders will be held on Monday, April 26, 2021 at 100 First Stamford Place, Ground Floor Conference Room, Stamford, Connecticut 06902, at 10:00 a.m. Eastern Daylight Time. Proposals to be voted on at the meeting are listed below along with the Board of Directors’ recommendations. The Board of Directors recommends a vote FOR all the nominees listed, and FOR Proposals 2, 3 and
PLEASE NOTE – YOU CANNOT VOTE BY RETURNING THIS NOTICE. To vote your shares you must go online or request a paper copy of the proxy materials to receive a proxy card. If you wish to attend and vote at the meeting, please bring this notice with you.
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