Crane NXT 424B3Prospectus supplement

Filed Pursuant to Rule 424(b)(3)
Registration No. 333-263119

CRANE CO. 100 FIRST STAMFORD PLACE STAMFORD, CONNECTICUT 06902   A HOLDING COMPANY REORGANIZATION IS PROPOSED – YOUR VOTE IS VERY IMPORTANT   Dear Fellow Stockholders:				This Proxy Statement/Prospectus and the 2021 Annual Report to Stockholders are available at www.craneco.com/ar

Crane Co. cordially invites you to attend the virtual Annual Meeting of Stockholders of Crane Co., which will be held online via live webcast at 10:00 a.m. Eastern Daylight Time, on Monday, May 16, 2022. There will be no physical location for the Annual Meeting. Crane Co. stockholders will be able to attend the Annual Meeting online, and, with a control number appearing on your proxy card, vote shares electronically and submit questions during the Annual Meeting by visiting www.meetnow.global/MXUNZN9 at the meeting date and time.

In addition to the other proposals described on the following pages, at the Annual Meeting, you will be asked to consider and vote on a proposal (the “Holding Company Proposal”) to reorganize our corporate structure following which Crane Co. will become a subsidiary of a new Delaware corporation named Crane Holdings, Co. (“Crane Holdings”).

Implementing the new holding company structure will provide us with strategic, operational and financing flexibility and enable us to more efficiently manage the operations and liabilities in each segment of our business.

The Holding Company Proposal contemplates that Crane Co. will merge with Crane Transaction Company, LLC, a new Delaware limited liability company and wholly-owned subsidiary of Crane Holdings (“Merger Sub”), pursuant to an agreement and plan of merger. Upon completion of the reorganization merger, Crane Co. will be a wholly-owned subsidiary of Crane Holdings and Crane Holdings will replace Crane Co. as the publicly-listed corporation and will conduct all of the operations currently conducted by Crane Co. Your shares of Crane Co. common stock will be converted automatically into shares of Crane Holdings common stock. You will own the same number of shares of Crane Holdings common stock as you own of Crane Co. common stock immediately prior to the reorganization merger, and your shares in Crane Holdings will represent the same ownership of Crane Holdings as you have of Crane Co. immediately prior to the reorganization merger. Your rights as a stockholder of Crane Holdings will be substantially the same as the rights you currently have as a stockholder of Crane Co., including rights as to voting and dividends. In addition, the reorganization merger contemplated by the Holding Company Proposal is generally expected to be tax-free to Crane Co., Crane Holdings and Crane Co. stockholders for U.S. federal income tax purposes.

We expect the shares of Crane Holdings common stock to continue to trade under the ticker symbol “CR” on the New York Stock Exchange.

Our Board of Directors has carefully considered the agreement and plan of merger and believes that it is advisable, fair to and in the best interests of our stockholders, and recommends that you vote FOR the Holding Company Proposal and the other proposals described on the following pages. Because adoption and approval of the Holding Company Proposal requires the affirmative vote of a majority of the issued and outstanding shares of Crane Co. stock entitled to vote at the Annual Meeting, it is important that your shares be represented at the Annual Meeting, regardless of the size of your holdings. If you are unable to attend the virtual Annual Meeting, we urge you to participate by voting your shares by proxy pursuant to the instructions included in this Proxy Statement/Prospectus. Any stockholder attending the virtual Annual Meeting may vote at the virtual Annual Meeting even if a proxy has been returned.

The Notice of Annual Meeting and Proxy Statement/Prospectus on the following pages describe the matters to be presented at the Annual Meeting. Management will also report on current operations, and there will be an opportunity to ask questions regarding Crane Co. and its activities.

Please read these materials carefully. In particular, you should consider the discussion of risk factors beginning on page 17 before voting on the Holding Company Proposal.

Sincerely,

James L. L. Tullis

Chairman of the Board

April 15, 2022

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued under this Proxy Statement/Prospectus or determined if this Proxy Statement/Prospectus is accurate or adequate. Any representation to the contrary is a criminal offense.

This Proxy Statement/Prospectus is dated April 15, 2022 and is first being mailed to Crane Co. stockholders on or about April 18, 2022.

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To the Stockholders of Crane Co.:

The 2022 ANNUAL MEETING OF STOCKHOLDERS OF CRANE CO. will be held virtually for the following purposes:

		WHEN:

May 16, 2022

Monday 10:00 a.m.

Eastern Daylight Time

 

		WHERE:

Online via live webcast at www.meetnow.global/MXUNZN9

HOW TO VOTE:

 

		By Phone

800-652-VOTE (8683)

in the United States,

United States territories,

and Canada

 

		By Mail

Complete, sign, and return the proxy card.

 

		By Internet

www.envisionreports.com/cr

 

		Live Webcast

Stockholders at the close of business on April 5, 2022, are entitled to vote at the Annual Meeting virtually.

 

		By Scanning

You can vote your shares online by scanning the QR code on your proxy card.

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Additional Information

This Proxy Statement/Prospectus incorporates by reference important business and financial information about the Company from our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the U.S. Securities and Exchange Commission on February 28, 2022, and other documents that are not included or delivered with this Proxy Statement/Prospectus. See “Where You Can Find Additional Information” on page 114 and “Incorporation of Certain Documents by Reference” on page 114 for more information. You should rely only on the information contained or incorporated by reference in this Proxy Statement/Prospectus and the Registration Statement of which this Proxy Statement/Prospectus is a part to vote on the proposals being presented at the Annual Meeting. No one has been authorized to provide you with information that is different from what is contained in this document or in the documents that are incorporated by reference.

We will provide, without charge, to each person to whom a copy of this Proxy Statement/Prospectus has been delivered, a copy of any and all of the documents referred to herein that are summarized in this Proxy Statement/Prospectus, if such person makes a written or oral request directed to Crane Co., 100 First Stamford Place, Stamford, Connecticut 06902, Attention: Corporate Secretary, Telephone: (203) 363-7300. If you would like to request any documents, please do so by May 9, 2022 in order to receive them before the Annual Meeting.

This Proxy Statement/Prospectus is dated April 15, 2022. You should not assume the information contained in this Proxy Statement/Prospectus is accurate as of any date other than this date, and neither the mailing (or otherwise making available) of this Proxy Statement/Prospectus nor the issuance of the Crane Holdings common stock pursuant to the agreement and plan of merger implies that information is accurate as of any other date.

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Table of Contents

4      

Proxy Statement/Prospectus

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Summary of the Holding Company Proposal

This section highlights key aspects of the Holding Company Proposal, including the Agreement and Plan of Merger (the “Reorganization Agreement”), which are described in greater detail elsewhere in this Proxy Statement/Prospectus. It does not contain all of the information that may be important to you. To better understand the Holding Company Proposal, and for a more complete description of the legal terms of the Reorganization Agreement, you should read this entire document carefully, including the description “Item 4: The Holding Company Proposal” on page 81, the Appendices to this Proxy Statement/Prospectus, and the additional documents to which we refer you. See “Where You Can Find Additional Information” on page 114 and “Incorporation of Certain Documents by Reference” on page 114 for more information.

The Principal Parties

Crane Co.

100 First Stamford Place

Stamford, Connecticut 06902

Telephone: (203) 363-7300

Crane Co. is a diversified manufacturer of highly engineered industrial products. Founded in 1855, Crane Co. provides products and solutions to customers in the chemicals, oil & gas, power, automated payment solutions, banknote design and production and aerospace & defense markets, along with a wide range of general industrial and consumer related end markets. The Company has four business segments: Aerospace & Electronics, Process Flow Technologies, Payment & Merchandising Technologies, and Engineered Materials. On May 24, 2021, Crane announced that it had signed an agreement to divest its Engineered Materials segment. On March 17, 2022, the DOJ filed a complaint to enjoin that sale transaction. In the normal course, the Company expects to engage in a process to address the DOJ’s antitrust concerns regarding a minor overlap in a narrow range of material used in certain commercial building applications. Crane Co. has approximately 11,000 employees in North and Central Americas, Europe, the Middle East, Asia and Australia. Crane Co. is traded on the New York Stock Exchange (the “NYSE”) (NYSE:CR).

Upon completion of the transactions contemplated by the Reorganization Agreement, you will become a stockholder of Crane Holdings, Co. (“Crane Holdings”), a new Delaware corporation that is a holding company, which is currently Crane Co.’s wholly-owned subsidiary. Under the Reorganization Agreement, Crane Co. will merge with Crane Transaction Company, LLC (“Merger Sub”), a Delaware limited liability company and wholly-owned subsidiary of Crane Holdings, with Crane Co. surviving the merger as a wholly-owned subsidiary of Crane Holdings (the “reorganization merger”).

Following the reorganization merger, Crane Holdings intends for Crane Co. (which will, as of that time, be a wholly-owned subsidiary of Crane Holdings) to convert from a Delaware corporation to a Delaware limited liability company. We refer to the reorganization merger and the transactions described in this paragraph collectively as the “reorganization.” Immediately following the reorganization merger, Crane Co. will continue to engage in its current business. All of Crane Co.’s contractual, employment and other business relationships will generally continue at the Crane Holdings’ level unaffected by the reorganization merger.

Crane Co. is a Delaware corporation. Crane Co.’s headquarters are located at 100 First Stamford Place, Stamford, Connecticut 06902, and the telephone number at this location is (203) 363-7300. Crane Co. files annual, quarterly and current reports and amendments to these reports, proxy statements and other information with the U.S. Securities and Exchange Commission (the “SEC”). The SEC maintains an Internet site that contains reports, proxy and information statements and other information regarding issuers, like Crane Co., that file electronically with the SEC. The address of the SEC’s website is www.sec.gov.

Crane Co. also makes its filings available free of charge through its Internet website, as soon as reasonably practicable after filing such material electronically with, or furnishing such material, to the SEC. Also posted on Crane Co.’s website are its Corporate Governance Guidelines, Standards for Director Independence, Crane Co. Code of Ethics and the charters and a brief description of each of the Audit Committee, the Management Organization and Compensation

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Summary of the Holding Company Proposal

Committee and the Nominating and Governance Committee. These items are available in the “Investors—Corporate Governance” section of Crane Co.’s website at www.craneco.com. The content of Crane Co.’s website are not incorporated by reference herein and are not deemed to be part of this Proxy Statement/Prospectus.

Crane Holdings, Co.

100 First Stamford Place

Stamford, Connecticut 06902

Telephone: (203) 363-7300

Crane Holdings is a Delaware corporation formed as a wholly-owned subsidiary of Crane Co. in order to effectuate the reorganization merger. Prior to the reorganization merger, Crane Holdings will have no property, assets, liabilities or operations, other than those incident to its formation. Crane Holdings is not currently subject to any legal proceedings.

Crane Transaction Company, LLC

100 First Stamford Place

Stamford, Connecticut 06902

Telephone: (203) 363-7300

Merger Sub is a Delaware limited liability company formed as a wholly-owned subsidiary of Crane Holdings in order to effectuate the reorganization merger. Prior to the reorganization merger, Merger Sub will have no property, assets, liabilities or operations, other than those incident to its formation. Merger Sub is not currently subject to any legal proceedings.

The Reorganization (Page 81)

Following the adoption and approval of the Holding Company Proposal by the requisite Crane Co. stockholders and the satisfaction or waiver of the other conditions specified in the Reorganization Agreement (which are described below), Crane Co. will merge with Merger Sub, with Crane Co. surviving the merger as a wholly-owned subsidiary of Crane Holdings. We refer to the merger of Crane Co. with Merger Sub, with Crane Co. surviving the merger as a wholly-owned subsidiary of Crane Holdings, as the “reorganization merger.”

The result of the reorganization merger will be that Crane Co. will become a wholly-owned subsidiary of Crane Holdings. Crane Holdings will be the publicly traded holding company of its subsidiaries, including Crane Co.

Following the reorganization merger, Crane Holdings intends for Crane Co. (which will, as of that time, be a wholly-owned subsidiary of Crane Holdings) to convert from a Delaware corporation to a Delaware limited liability company. We refer to the reorganization merger and the transactions described in this paragraph collectively as the “reorganization.”

Following the reorganization, additional steps may be taken to align our corporate structure with our business operations and liability management strategy, but such steps are not considered part of the reorganization for purposes of this Proxy Statement/Prospectus.

Reasons for the Reorganization; Recommendation of the Crane Co. Board (Page 83)

At a meeting of the Board held on Monday, February 28, 2022, the Board concluded that the reorganization is advisable, determined that the terms of the Reorganization Agreement are advisable, fair to and in the best interests of Crane Co. and its stockholders and adopted and approved the Reorganization Agreement. The Board recommends a vote “FOR” the adoption and approval of the Holding Company Proposal (including the Reorganization Agreement). During the course of its deliberations, the Board consulted with management, outside legal counsel and outside tax and accounting advisors and considered a number of factors, including that the reorganization is expected to:

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Summary of the Holding Company Proposal

What Crane Co. Stockholders Will Receive in the Reorganization Merger (Page 84)

In the reorganization merger, each outstanding share of Crane Co. common stock will be converted automatically into one share of Crane Holdings common stock. Immediately after the completion of the reorganization merger, Crane Holdings will own all of Crane Co.’s common stock and each share of Crane Holdings common stock now held by Crane Co. will be cancelled.

In addition, each outstanding option to purchase shares of Crane Co. common stock, if not exercised before the completion of the reorganization merger, will be adjusted automatically into an option to acquire, at the same exercise price, an identical number of shares of Crane Holdings common stock. Each outstanding restricted share unit, performance-based restricted share unit and deferred stock unit, in each case, for shares of Crane Co. common stock will be adjusted automatically into a corresponding restricted share unit, performance-based restricted share unit and deferred stock unit, in each case, for an identical number of shares of Crane Holdings common stock. Except as set forth in the immediately preceding two sentences, all such equity awards will continue to have the same terms and conditions as applied immediately prior to the reorganization merger.

In addition, in connection with the reorganization merger, Crane Holdings will assume each of the existing stock-based compensation plans, which include Crane Co.’s 2013 Stock Incentive Plan, as amended and Crane Co.’s 2018 Stock Incentive Plan, as amended (collectively, the “Crane Co. Stock Plans”) and the shares available for issuance under the Crane Co. Stock Plans will be adjusted in accordance with the terms of the respective plans to reflect shares of Crane Holdings common stock.

On the Record Date, there were outstanding 56,173,793 shares of Crane Co. common stock and 398,344 unvested restricted share units, 199,018 unvested performance-based restricted share units (at 100% of target) and 131,404 unvested deferred stock units (and 16,151 deferred dividends), as well as options to acquire an aggregate of 2,051,495 shares of Crane Co. common stock.

As of the Record Date, approximately 2.4% of the outstanding shares of Crane Co. common stock were beneficially owned by Crane Co.’s directors and executive officers and their affiliates. We currently expect that Crane Co.’s directors and executive officers will vote their shares, and direct that the shares held in the Crane Fund (as defined below) be voted, in favor of the Holding Company Proposal, although they are under no obligation to do so.

Conditions to Completion of the Reorganization Merger (Page 84)

We will complete the reorganization merger only if each of the following conditions is satisfied or waived:

      15

Summary of the Holding Company Proposal

Deferral and Abandonment; Termination of Reorganization Agreement (Page 85)

We may defer or abandon the reorganization merger prior to the effective time of the reorganization merger (including by terminating the Reorganization Agreement) or all or any part of the reorganization, even after adoption and approval by our stockholders, if we determine that for any reason the completion of all or such part of the reorganization would be inadvisable or not in the best interests of our Company and our stockholders.

Board of Directors and Executive Officers of Crane Holdings Following the Reorganization Merger (Page 85)

The Board of Directors of Crane Holdings following the reorganization merger will consist of the same persons comprising the Board of Crane Co. immediately prior to the reorganization merger. Similarly, the executive officers of Crane Holdings following the reorganization merger will be the same as those of Crane Co. immediately prior to the reorganization merger.

U.S. Federal Income Tax Considerations (Page 85)

The reorganization is intended to be a tax-free transaction under U.S. federal income tax laws. Accordingly, we expect that you will not recognize any gain or loss for U.S. federal income tax purposes upon your receipt of Crane Holdings common stock in exchange for your shares of Crane Co. common stock in the reorganization merger. See “Item 4: The Holding Company Proposal—U.S. Federal Income Tax Considerations” on page 85 for more information.

Markets and Market Prices

Crane Holdings common stock is not currently traded on any stock exchange. Crane Co. common stock is traded under the ticker symbol “CR” on the NYSE, and we expect Crane Holdings common stock to continue to trade on the NYSE under the ticker symbol “CR” following the reorganization merger. On February 28, 2022, the last trading day before the announcement of the Holding Company Proposal, the closing price per Crane Co. share was $101.08. On April 14, 2022, the most recent trading day for which prices were available, the closing price per Crane Co. share was $105.68.

Appraisal Rights (Page 88)

Under Delaware law, Crane Co.’s stockholders do not have appraisal rights with respect to the reorganization merger.

Certain Financial Information

We have not included pro forma financial comparative per share information concerning Crane Co. that gives effect to the reorganization merger because, immediately after the completion of the reorganization merger, the consolidated financial statements of Crane Holdings will be the same as Crane Co.’s consolidated financial statements immediately prior to the reorganization merger, and the reorganization merger will result in the conversion of each share of Crane Co. common stock into one share of Crane Holdings common stock. In addition, we have not provided financial statements of Crane Holdings because, prior to the reorganization merger, it will have no properties, assets, liabilities or operations other than those incident to its formation. We have incorporated by reference our Annual Report on Form 10-K for the year ended December 31, 2021, as well as other filings with the SEC. See “Incorporation of Certain Documents by Reference” on page 114 for more information.

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In considering whether to vote in favor of the Holding Company Proposal, you should consider all of the information we have included in this Proxy Statement/Prospectus, including the description in “Item 4: The Holding Company Proposal” on page 81, the Appendices to this Proxy Statement/Prospectus, and all of the information included in the documents we have incorporated by reference, including our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and the risk factors described therein and in the other documents incorporated by reference. See “Where You Can Find Additional Information” on page 114 and “Incorporation of Certain Documents by Reference” on page 114 for more information.

In addition, you should pay particular attention to the risks described below.

The Board may choose to terminate the Reorganization Agreement or defer or abandon the reorganization.

The Reorganization Agreement may be terminated and completion of all or any part of the reorganization may be deferred or abandoned, at any time, prior to the effective time of the reorganization merger, by action of the Board, whether before or after the Annual Meeting. While we currently expect the reorganization merger to take place in May 2022, assuming that the Holding Company Proposal is adopted and approved at the Annual Meeting, the Board may terminate the Reorganization Agreement or defer completion or abandon all or any part of the reorganization, even after adoption and approval by our stockholders, but prior to the effective time of the reorganization merger, if the Board determines that completion of all or such part of the reorganization would be inadvisable or not in the best interests of our Company and our stockholders.

We may not obtain the expected benefits of the reorganization.

We believe the reorganization will provide us with benefits in the future. These expected benefits may not be obtained if market conditions or other circumstances prevent us from taking advantage of the strategic, business and financial flexibility that we believe the reorganization will afford us. As a result, we may incur the costs of creating the holding company structure without realizing the possible benefits.

The proposed reorganization may result in substantial direct and indirect costs, whether or not it is completed.

Implementing the reorganization may result in substantial direct costs. These costs and expenses are expected to consist primarily of attorneys’ fees, tax advisors’ fees, accountants’ fees, filing fees and financial printing expenses, which are expected to be substantially incurred prior to the vote of our stockholders, as well as costs related to our indebtedness and contractual relationships as detailed immediately below. The reorganization may also result in certain indirect costs by diverting the attention of our management and employees from our business and by increasing our administrative costs and expenses. The reorganization may also result in certain state transfer or other taxes.

The market for Crane Holdings shares may differ from the market for Crane Co. shares.

Although it is anticipated that the Crane Holdings common shares will be authorized for listing on the NYSE, the market prices, trading volume and volatility of the Crane Holdings shares could be different from those of the Crane Co. shares.

We may not be able to clearly establish when a sale of all or substantially all of the assets has occurred under New York law.

Crane Holdings can only assume our existing indentures upon a sale of all or substantially all of Crane Co.’s assets. The meaning of “substantially all” varies according to the facts and circumstances of the subject transaction and has no clearly established meaning under New York law, which is the law that governs our existing indentures. This ambiguity as to when a sale of substantially all of our assets has occurred may result in uncertainty regarding whether the existing

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Risk Factors Related to the Holding Company Proposal

indentures will be transferred to Crane Holdings with Crane Co.’s other assets. If the reorganization merger transactions do not constitute a sale of all or substantially all of our assets, the existing indentures will remain with Crane Co.

The reorganization merger would result in an Event of Default under our 2021 Facility (as defined below). We are seeking waivers or amendments to the 2021 Facility to avoid any such Event of Default. We may be required to pay fees or agree to changes to the terms of the 2021 Facility in connection with such waivers or amendments.

The reorganization merger would result in an Event of Default (as defined in the 2021 Facility) under our $650 million, 5-Year Revolving Credit Agreement (the “2021 Facility”), by and among Crane Co., CR Holdings C.V., a Dutch limited partnership and wholly-owned subsidiary of Crane Co., the banks party thereto as lenders, JPMorgan Chase Bank, N.A., as administrative agent, Wells Fargo Bank, National Association, as syndication agent, and HSBC Bank USA, National Association, U.S. Bank National Association and Bank of America, N.A., as documentation agents. We are seeking waivers or amendments to the 2021 Facility to avoid any such Event of Default. However, there can be no assurance that we will be able to obtain the necessary waivers or amendments. In any case, we may be required to pay fees or agree to changes to the terms of the 2021 Facility in connection with such waivers or amendments.

Any consent, non-renewal, termination or other similar rights under any of our contracts that are triggered by the reorganization could have an adverse effect on our operations and financial performance.

Our relationships with our customers, suppliers, landlords, employees and other third parties are typically governed by written contracts. Certain of these contracts may include provisions that would permit the third party to terminate or modify the contract, or that would require its consent under the terms of the contract, as a result of the reorganization merger or other aspects of the reorganization. In those situations, we may need to negotiate with the applicable third party to obtain a consent or waiver of a contractual right, and the third party may fail to grant the consent or waiver or impose new terms or conditions that are adverse to us in connection with doing so. Any such terminations, unfavorable renegotiation or changes in the terms of our third party contracts following the reorganization could have an adverse effect on our business and operations, including product or service availability and cost, and on our financial performance and results of operations.

As a holding company, Crane Holdings will depend in large part on its operating subsidiaries to satisfy its obligations.

After the completion of the reorganization merger, Crane Holdings will be a holding company with no business operations of its own, other than those that are operated by Crane Co. as of immediately prior to the reorganization merger (which Crane Co. expects will generally be assigned to Crane Holdings or its applicable subsidiaries promptly following the reorganization merger). Its only other significant assets will be the outstanding capital stock of its subsidiaries. As a result, it will rely on funds from its current subsidiaries and any subsidiaries that it may form or acquire in the future to meet its obligations.

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Crane Co. Board Composition

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. In addition, the Guidelines provide that any director who has attained the age of 75 as of the record date for the annual meeting of stockholders shall tender his/her resignation from the Board.

The Board currently consists of ten members, nine of whom are independent. Donald G. Cook, who has been a member of the Board since 2005, has attained the age of 75 as of the Record Date and, in accordance with the Company’s Director retirement policy, will retire from the Board effective as of the Annual Meeting.

The nine directors whose terms will expire at the time of the Annual Meeting, but will serve until their successors are duly elected and qualified, are Martin R. Benante, Michael Dinkins, Ronald C. Lindsay, Ellen McClain, Charles G. McClure, Jr., Max H. Mitchell, Jennifer M. Pollino, John S. Stroup, and James L. L. Tullis.

The Board has nominated each of the nine non-retiring directors for re-election by the stockholders for a one-year term to expire at the 2023 annual meeting of stockholders. The Board has determined that all directors other than Mr. Mitchell are independent directors.

The Company believes a board with between nine to twelve directors is appropriate to generate a manageable diversity of thought, perspective and 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 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 diversity 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 leadership experience. In addition, nominees should have the ability to make independent, analytical judgments, and they should be effective communicators 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 may 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 may not serve on more than two other audit committees of public companies. All of the director nominees are in compliance with these requirements.

The Nominating and Governance Committee has proposed, and the Board recommends, that each of the nine nominees be elected to the Board. If, before the Annual Meeting, any nominee becomes unavailable for election as a director, the elected directors may make an interim vacancy appointment to the Board after the Annual Meeting, or the Board may reduce the number of directors to eliminate the vacancy.

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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 and professional experience, education, skills, and other personal qualities and attributes that enable the Board to perform its duties in a highly effective manner. The Company is proud to have such a diverse Board, including with respect to gender and ethnicity.

Board Snapshot

Board Skills and Experience

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 broad 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.

Summary of Board Skills and Experience

Public company multinational CEO experience

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Public company multinational CFO experience

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General finance acumen

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Corporate governance/board experience

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Mergers & acquisitions

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Manufacturing operations

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Expertise with one or more of Crane Co.’s end markets

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Intellectual capital development (human capital)

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Independent

Self-Identified Race/Ethnicity

African American

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White Caucasian

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Self-Identified Gender

Male

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Female

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The Board Composition and Board Skills and Experience sections above reflect the Board’s nine director nominees. Donald G. Cook is retiring as of the Annual Meeting and, therefore, is not included in the above skills matrix.

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Item 1: Election of Directors

Board of Directors Nominees

Nominees to be Elected for Terms to Expire in 2023

				MARTIN R. BENANTE   Age: 69   Director Since: 2015		Crane Co. Committees: Audit (Chair); Nominating and 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:   •  Curtiss-Wright Corporation from 1999 to 2015
		Relevant Skills and Experience:   •  Strategic, operational, and managerial expertise gained through a more than 35-year career with a leading industrial manufacturer of highly engineered products in critical service applications, serving markets similar to those of the Company   •  CEO of a publicly traded company with international operations   •  Expertise in domestic and international mergers and acquisitions, and in the global integration of acquired companies

				MICHAEL DINKINS   Age: 68   Director Since: 2019		Crane Co. Committees: Audit; Nominating and Governance
		Retired Executive Vice President and Chief Financial Officer, Integer Holdings Corporation, Plano, TX (leader in advanced medical device outsourcing).   Other Directorships:   •  The Shyft Group since 2020   •  Community Health Systems, Inc. since 2017
		Relevant Skills and Experience:   •  Sophisticated financial expertise acquired through public company chief financial officer, chief executive officer and financial, IT and internal audit roles   •  Significant experience with complex leveraged refinancing and equity financing (initial public offering and secondary markets) transactions   •  CEO of a publicly traded company with international operations   •  Expertise in the global integration of acquired companies   •  National Association of Corporate Directors – Directorship Certification®

Note: Age calculations for all directors are as of the Record Date.

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Item 1: Election of Directors

				RONALD C. LINDSAY   Age: 63   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, from 2011 to 2013. Positions of increasing responsibility with Eastman Chemical Company from 1980, including Senior Vice President from 2006 to 2009 and Executive Vice President from 2009 to 2013.
		Relevant Skills and Experience:   •  Corporate strategy, operational, sales, and manufacturing expertise gained by extensive senior executive experience with Eastman Chemical Company, a leading chemical manufacturer served by the Company’s Process Flow Technologies segment

				ELLEN MCCLAIN   Age: 57   Director Since: 2013		Crane Co. Committees: Audit; Management Organization and Compensation
		Chief Operating Officer, since 2021, and Chief Financial Officer from 2015 to 2021, Year Up, Boston, MA (not-for-profit provider of job training services). Senior management and financial positions with New York Racing Association, Inc., Ozone Park, NY (operator of thoroughbred racetracks), including President from 2012 to 2013. Vice President, Finance of Hearst-Argyle Television, Inc., New York, NY (operator of local television stations) from 2004 to 2009.   Other Directorships:   •  Horseracing Integrity and Safety Authority since 2021
		Relevant Skills and Experience:   •  Financial, operational and organizational expertise gained as chief financial officer, chief operating officer, and president of public and private enterprises   •  Broad experience as a senior executive with responsibility for organizational direction and development, financial expertise, and intellectual capital

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Item 1: Election of Directors

				CHARLES G. MCCLURE, JR.   Age: 68   Director Since: 2017		Crane Co. Committees: Management Organization and Compensation; Nominating and Governance
		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., Troy, MI (leading global supplier of drivetrain, mobility, braking, and aftermarket solutions for commercial vehicle and industrial markets).   Other Directorships:   •  3D Systems since 2017; Chairman since 2018   •  Penske Corporation since 2013   •  DTE Energy Company since 2012
		Relevant Skills and Experience: •  More than 35 years of experience in corporate strategy, manufacturing, sales, operational, and intellectual capital expertise in various industries, including transportation   •  Proven leadership skills with over 20 years of experience as chief executive officer, president, and director of major domestic and international corporations, as well as a member of the boards of various industry organizations

				MAX H. MITCHELL   Age: 58   Director Since: 2014		Crane Co. Committees: Executive
		President and Chief Executive Officer of the Company since 2014; President and Chief Operating Officer from 2013 to 2014; Executive Vice President and Chief Operating Officer from 2011 to 2013; Group President, Process Flow Technologies segment of the Company from 2005 to 2012.   Other Directorships:   •  Lennox International, Inc. since 2016   •  Manufacturers Alliance for Productivity and Innovation
		Relevant Skills and Experience: •  Comprehensive knowledge of the Company’s culture and operations gained from successive leadership positions of increasing responsibility   •  Demonstrated expertise developing and driving corporate strategy and optimizing portfolio results   •  Extensive knowledge of, and experience with, the global end markets in which the Company trades   •  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

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Item 1: Election of Directors

				JENNIFER M. POLLINO   Age: 57   Director Since: 2013		Crane Co. Committees: Audit; Management Organization and Compensation (Chair)
		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   •  Kaman Corporation since 2015; Lead Independent Director since 2021   •  Wesco Aircraft Holdings, Inc. from 2014 to 2020   •  National Association of Corporate Directors since 2021
		Relevant Skills and Experience: •  Broad experience as an aerospace industry senior executive with responsibility for corporate governance, intellectual capital, and organizational issues, as well as financial and operational expertise, gained in over 20 years as senior executive and general manager with a leading aerospace products company   •  Financial expertise gained as controller of savings and loan association and field accounting officer at Resolution Trust Corporation   •  Certified Public Accountant

				JOHN S. STROUP   Age: 55   Director Since: 2020		Crane Co. Committees: Management Organization and Compensation
		Operating Advisor, Clayton, Dubilier & Rice (a global private equity manager that invests in and builds businesses) since 2020. Former President, Chief Executive Officer, and member of the board of directors from 2005 to May 2020, Chairman from 2016, and Executive Chairman from 2020 to May 2021, of Belden Inc. (a global leader in signal transmission and security solutions).   Other Directorships:   •  Tenneco since 2020   •  Zurn Water since 2008*   •  Belden, Inc. from 2005 to May 2021; Chairman from 2016 to 2020; Executive Chairman from 2020 to May 2021
		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
		*  In October 2021, Regal Beloit Corporation and Rexnord Corporation effected a corporate spin-off transaction resulting in two entities, Regal Rexnord Corporation and Zurn Water. The entity formerly known as Rexnord Corporation was renamed Zurn Water.

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Item 1: Election of Directors

				JAMES L. L. TULLIS   Age: 74   Director Since: 1998		Crane Co. Committees: Executive (Chair)
		Chairman, Tullis Health Investors, LLC, Palm Beach Gardens, FL (venture capital investments in the health care industry) from 1988 to the present.   Other Directorships:   •  ATEC, Inc. since 2018   •  Exagen Diagnostics, Inc. since 2015   •  Lord Abbett & Co. Mutual Funds since 2006; Chairman since 2017   •  electroCore, Inc. from 2018 to 2020
		Relevant Skills and Experience: •  Executive leadership, financial and organizational expertise gained as chief executive officer of venture capital investment group   •  Significant experience and expertise in management, strategy and governance matters gained as director of several public and private companies, including serving as chairman and on the compensation, nominating and governance, audit and executive committees of public companies

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.

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Item 1: Election of Directors

Independent Status of Directors

Standards for Director Independence

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 to qualify as independent, the Board must affirmatively determine 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 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 through 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 2021.

Crane Co.’s Standards for Director Independence, along with its Corporate Governance Guidelines and Code of Business Conduct and Ethics, which apply to Crane Co.’s directors and to all officers and other employees, including our Chief Executive Officer, Chief Financial Officer and Controller, are available on our website at www.craneco.com/governance. See “Code of Business Conduct and Ethics” on page 35.

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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 Sections 10A and 10C, respectively, of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), 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 2021 are independent in accordance with the foregoing standards, and the Board 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 0.1% 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 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 Refreshment

At the 2017 annual meeting, our stockholders voted to declassify the Board, 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 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 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 an appropriate balance of knowledge, experience, skills, expertise, and 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.

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Item 1: Election of Directors

Board Effectiveness

Our Board, led by our Nominating and Governance Committee, evaluates the size and composition of our Board at least annually, giving consideration to evolving skills, diversity, perspective, and experience needed on our Board 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.

		STEPS TO IMPROVE BOARD EFFECTIVENESS   •  Identify director candidates with diverse backgrounds and experiences   •  Annual Board and committee performance self-evaluations   •  Alignment of director strengths with the Company’s strategic goals and objectives   •  Director retirement policy   •  Strict over-boarding policy for directors   •  Adjust the size of the Board as appropriate
		OUTCOMES    Eightnew directors over the past nine years    Expandedqualifications and diversity of thought, including the number of women and ethnically diverse directors, represented on the Board    Threedirectors retired in last four years in accordance with director retirement policy    Furtherskills added to the board include:   •  Significant international M&A experience   •  Public company CEO experience   •  Public company CFO experience   •  Military and defense expertise

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 certain 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:

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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 (as defined below).

Any stockholder recommendation for next year’s annual 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 not less than 90 days nor more than 120 days prior to May 16, 2023.

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.

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 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 on their strategic plans 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 material capital allocation decisions.

Environmental, Social and Governance (“ESG”) Oversight

ESG strategies and initiatives are integrated into the purview of the Board. Our Board takes an active role in its oversight by reviewing ESG matters relevant to the Company’s business, including environmental sustainability, corporate governance and diversity, equity, and inclusion. At least annually, the Board receives a comprehensive review of management’s plan for the Company with respect to philanthropy, sustainability, and equality initiatives and reviews the Company’s prior year efforts and performance on these important issues. (See “Corporate Governance and Sustainability” on page 37). Our Board also receives periodic reports from management regarding the Company’s efforts, initiatives, and performance with respect to these metrics and is not only responsible for the oversight of the Company’s ESG commitments, but for periodically reviewing the Company’s policies and practices regarding ESG matters.

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Item 1: Election of Directors

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, which includes receiving regular reports on environmental remediation activities, and on any violations of law or Company policies and resultant 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.

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 62.

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 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. A key element of the IC process is the identification of management succession needs and opportunities, whether arising from natural career

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Item 1: Election of Directors

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. Crane Co. typically hosts an annual investor day event 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 portfolio and capital allocation strategies. In 2021, in addition to our usual first quarter investor day event, we hosted an Aerospace & Electronics-specific investor day event in May to provide further details about the exciting growth opportunities in that segment. During 2021, the Company also participated in meetings, phone calls and video conference calls with approximately 115 different investors at conferences, during investor roadshows, and in response to direct investor inquiries.

Our Vice President of Investor Relations and/or our Chief Financial Officer provide feedback from the investor and analyst meetings formally to the Board 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 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, any individual director or any group or committee of directors, correspondence should be addressed to the Board 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: 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 they 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 communication is addressed.

Board Structure

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 and the needs of the Company at the time. These leadership roles are currently filled separately by our non-employee Chairman of the Board, 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-employee Chairman of the Board, which is incorporated into our Corporate Governance Guidelines. The principal duties are as follows:

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Item 1: Election of Directors

The Board will continue to monitor and assess its leadership structure to ensure it best serves the needs of the Company and its stockholders.

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Item 1: Election of Directors

Committees of the Board

The Board has established an Audit Committee, a Management Organization and Compensation Committee, and a Nominating and Governance Committee. The Board has also established an Executive Committee, which meets when a quorum of the full Board cannot be readily convened. The memberships of these committees are as follows:

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Item 1: Election of Directors

^* Donald G. Cook will remain Chair of the Nominating and Governance Committee and a member of the Executive Committee and Management Organization and Compensation Committee until his retirement at the Annual Meeting, at which time the Board will appoint a new Chair for the Nominating and Governance Committee and make other Committee membership adjustments as appropriate.

Executive Sessions of Non-Management Directors

All seven of the meetings of the Board during 2021 included executive sessions without management present, presided over by 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.

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Item 1: Election of Directors

Board Meetings and Attendance

The Board met seven times during 2021. Each director attended 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 our annual meetings either in person, virtually or telephonically; all members of the Board were present at the 2021 annual meeting.

Board Processes

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 facilitating an annual self-assessment of the Board’s performance, as well as an annual self-assessment undertaken by each committee of the Board. The multistep evaluation process begins with a questionnaire, and includes discussions with the Chairman and Board members, and discussions between Committee Chairs and the members of their 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.

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 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.

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 directors 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 Audit Committee, which is responsible for reviewing significant conflicts of interest involving directors or executive officers and/or the Nominating and Governance Committee, which is responsible for reviewing director nominee independence requirements. The respective Committees 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 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 SEC rules.

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Item 1: Election of Directors

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 has adopted Corporate Governance Guidelines which reflect the Board’s commitment to monitor the effectiveness of policy-making and decision-making at both the Board and management levels, with a view to enhancing long-term stockholder value. The Corporate Governance Guidelines are available on our website at www.craneco.com/investors/corporate-governance.

Copies of the charters of the Board committees are available on our website at www.craneco.com/CharterAudit; www.craneco.com/CharterCompensation; and www.craneco.com/CharterNominating, respectively.

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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.

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Item 1: Election of Directors

Compensation 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. The members of the Board, other than Mr. Mitchell (who does not receive compensation for his services as a director), receive the following compensation:

No meeting fees will be paid unless the total number of meetings exceeds three more than the regularly scheduled meetings of the Board 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 2021 Summary Compensation Table on page 67.

Mr. Tullis, the non-employee Chairman of the Board, receives the same annual retainer as a non-employee director plus an incremental retainer of $125,000 per year ($135,000 per year beginning in May 2022), payable in cash (or up to 100% in DSUs or fully vested shares, at the election of the Chairman). The Company also has a time-sharing agreement with Mr. Tullis 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 64.

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 2021, 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 recommended and the full Board approved the increases in the retainers for Board members beginning at the Annual Meeting in May 2022, as set forth above. Further pursuant to this review, the Committee determined that no changes in the retainers for Committee Chairpersons and members were required, and sustained the current retainers 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 recommended and the full Board approved an increase in the Chairman’s compensation to $135,000 effective as of the Annual Meeting.

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 2021, each non-employee director received DSUs pursuant to this plan as follows: Ms. McClain received 1,594 DSUs, Mr. McClure, Jr., received 1,862 DSUs, and the remaining non-employee directors each received 1,416 DSUs.

38      

Item 1: Election of Directors

Stock Ownership Guidelines for Directors

The Board has adopted stock ownership guidelines that 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 $85,000 and increasing to $90,000 beginning at the Annual Meeting). 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 believes to be reasonable progress towards compliance with this ownership guideline.

Director Compensation in 2021

The following table shows the actual compensation in 2021 of all directors except for Mr. Mitchell, our Chief Executive Officer, whose compensation is shown in the 2021 Summary Compensation Table on page 67.

      39

Item 1: Election of Directors

Director Stock Ownership

All of the Company’s directors own stock in the Company. For more information regarding each director’s overall beneficial ownership, see “Beneficial Ownership of Common Stock by Directors and Management” on page 97. As of December 31, 2021, each non-employee director held the following aggregate number of vested and unvested DSUs:

40      

The Board 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 2022. Deloitte & Touche LLP has been Crane Co.’s independent auditor since 1979. Although ratification of this selection is not required by law, the Board 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 2022.

Annual Evaluation and Selection of Auditors

The Audit Committee (the “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 that 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 for the years ended December 31, 2021, and 2020 to Crane Co.’s principal accounting firm, Deloitte & Touche LLP, the member firms of Deloitte Touche Tohmatsu, and their respective affiliates:

      41

Item 2: Ratification of the Selection of Auditors

Pre-Approval Policy and Procedures

SEC 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:

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 (including virtual attendance) or represented by proxy and entitled to vote at the meeting. (See Questions and Answers About These Proxy Materials and the Annual Meeting, page 103).

Report of the Audit Committee

In accordance with its written charter adopted by the Board, the Committee assists the Board in fulfilling its responsibility for oversight of the quality and integrity of the accounting, auditing, and financial reporting practices of Crane Co. All the members of the Committee qualify as “independent” under the provisions of Section 10A of the Exchange Act and the rules of the SEC 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.”

In discharging its oversight responsibility as to the audit process, the Committee:

42      

Item 2: Ratification of the Selection of Auditors

The Committee reviewed the audited financial statements of Crane Co. as of and for the year ended December 31, 2021, 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 that Crane Co.’s audited financial statements be included in its Annual Report on Form 10-K for the year ended December 31, 2021, for filing with the SEC.

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 2022. The Committee also approved the reappointment of Deloitte & Touche LLP to serve as independent auditors; the Board 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.

Martin R. Benante, Chair

Michael Dinkins

Ronald C. Lindsay

Ellen McClain

Jennifer M. Pollino

Incorporation by Reference. The Audit Committee Report in this Proxy Statement/Prospectus shall not be deemed incorporated by reference by any general statement incorporating by reference this Proxy Statement/Prospectus into any filing under the Securities Act of 1933, as amended (the “Securities Act”) or the Exchange Act, 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.

      43

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 in 2023. In accordance with the requirements of Section 14A of the Exchange Act and the related SEC rules, we are asking stockholders to express their opinion on the compensation of the named executive officers in 2021, as described in the pages that follow in this Proxy Statement/Prospectus. 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:

The Compensation Discussion and Analysis beginning on page 45 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 2021, 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 that vest in accordance with the Company’s total stockholder return relative to the S&P Midcap 400 Capital Goods Group over a three-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.

The Board strongly endorses the Company’s actions in this regard, and recommends that stockholders vote for the following resolution:

RESOLVED, that the 2021 compensation of the named executive officers as disclosed in this Proxy Statement/Prospectus is 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. 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 proposal.

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 (including virtual attendance) 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 103.)

44      

We believe that compensation should be directly linked to performance and highly correlated to stockholder value. This section of this Proxy Statement/Prospectus 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,” whose compensation is set forth in the 2021 Summary Compensation Table and other compensation tables contained in this Proxy Statement/Prospectus:

Executive Compensation Index

      45

Compensation Discussion and Analysis

Executive Summary

We delivered strong financial performance during 2021, setting new records for earnings from continuing operations per diluted share (“EPS”), operating margins, cash provided by operating activities from continuing operations, and free cash flow, all of which were substantially above our expectations entering the year. We delivered these strong results even though our largest end markets remain depressed, with demand still below 2019 pre-novel coronavirus (“COVID-19”) levels. Further, these record results were achieved despite numerous challenges during the year including the rapid onset of substantial inflation in early 2021, numerous supply chain disruptions, and persistent operational impacts from COVID-19 related regulations and restrictions. In addition to generating strong financial results, we continued our consistent investments in numerous strategic growth initiatives to ensure that our business remains positioned to deliver profitable and sustainable above-market growth over the long-term. The market’s view of our strong performance and continued investment for growth is reflected in our stock’s performance, with TSR outpacing the most relevant benchmark indices during 2021.

We believe that our performance is evidence of our consistent, differentiated, best-in-class execution capabilities enabled by the cadence and discipline of the Crane Business System, Crane’s strong and unique culture, and the performance of Crane’s experienced and highly capable senior management team.

We believe that investors recognized our strong performance in 2021, and that this recognition resulted in TSR higher than that of the most relevant benchmark indices during 2021. Three-year annualized TSR trailed that of the most relevant benchmark indices which reflects outperformance in 2021 that was more than offset by the stock’s relative underperformance in 2019 and 2020.

Crane Co. TSR for Periods Ending December 31, 2021

A substantial majority of the compensation for our NEOs is performance-based and thus varies with the Company’s actual performance. Consistent with the Management Organization and Compensation Committee’s continued focus on aligning pay with performance, all variable elements of management’s compensation increased compared to 2020, reflecting the strong business performance and higher relative TSR compared to the prior year.

Specifically, annual bonuses for our CEO and other corporate NEOs, which are linked to Crane’s earnings per share and free cash flow, were 200% of target in 2021 compared to 13% for the CEO (as calculated) and 50% for the NEOs (as adjusted)^* in 2020, and 69.5% in 2019.

46      

Compensation Discussion and Analysis

The PRSUs granted to our NEOs for the three-year period 2019-2021 vested at 25% of target, which reflects the percentile ranking of the Company’s TSR relative to the TSR’s of the other constituent companies in the S&P Midcap 400 Capital Goods Group. In 2020, the PRSUs granted for the three-year period 2018-2020 vested at 0% due to below threshold performance resulting in no payout. In 2019, the PRSUs granted for the three-year period 2017-2019 vested at 61.3% of target.

2021 Performance Highlights

Record Financial Results Despite Challenging Market Conditions

Final 2021 financial results^* were substantially above our original financial targets for the year, driven by a combination of a better than expected recovery in certain end markets, consistent and strong operational execution, and substantial benefits from strategic growth investments. Specifically:

Continued to Execute Against Consistent Long-Term Strategy

Despite widespread global supply chain disruptions and inflationary pressure during 2021, 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 – Process Flow Technologies, Payment & Merchandising Technologies, and 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.”

With this framework, we continued to position the Company for long-term sustainable growth during 2021 with some significant accomplishments, including the following:

      47

Compensation Discussion and Analysis

NEW PRODUCT DEVELOPMENT

We successfully introduced a number of new products and solutions across our portfolio during 2020 and 2021. Among others:

PROGRESS ON GROWTH INITIATIVES

We experienced growth across most of our portfolio during 2021. Some notable examples:

48      

Compensation Discussion and Analysis

CAPITAL DEPLOYMENT AND PORTFOLIO MANAGEMENT

Management also took actions during 2021 to strengthen Crane’s overall portfolio of businesses, to return cash to stockholders, and to manage its balance sheet to ensure that the Company has the optimal operational structure and financial strength necessary to drive continued growth. Specific actions included:

Exiting 2021, the Company’s balance sheet is strong, with no short-term debt outstanding, long-term debt of $842 million (with maturities in 2023, 2036, and 2048), and cash of $479 million, none of which reflects the expected receipt of approximately $360 million (subject to closing adjustments) in proceeds from the sale of Engineered Materials. On March 17, 2022, the DOJ filed a complaint to enjoin that sale transaction. In the normal course, the Company expects to engage in a process to address the DOJ’s antitrust concerns regarding a minor overlap in a narrow range of material used in certain commercial building applications.

CONTINUED PROACTIVE REPOSITIONING ACTIONS

At the end of 2019, we approved additional repositioning actions in our Process Flow Technologies segment, including additional facility consolidation, to better geographically align our manufacturing footprint with customer needs. This opportunity arose as a result of continued operational improvements in certain facilities that are now able to handle higher volumes. These actions were delayed modestly as a result of COVID-19 related construction restrictions in certain regions. We expect, however, that these incremental actions will generate approximately $7 million of annual savings by 2022.

Further, in response to the COVID-19 pandemic, during 2020, we implemented gross cost reductions of approximately $105 million, approximately 40% of which were structural. The structural cost measures resulted in approximately $85 million of annualized savings in 2021.

      49

Compensation Discussion and Analysis

These actions are in addition to our regular and disciplined operating cadence that drives productivity benefits. Taken together, we believe all these actions position the Company for profitable growth, and that the combination of our core, underlying business prospects, along with the recent acquisitions, repositioning initiatives, and capital deployment potential, lay the groundwork for Adjusted EPS growth of approximately 10%, on average, over a multi-year period.

Compensation Framework

In December 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 Compensation Peer Group median compensation design based on data supplied by FW Cook, the Compensation Committee’s independent consultant. For 2021, the CEO’s long-term incentive mix is comprised of 55% PRSUs, 25% stock options and 20% time-based restricted share units (“TRSUs”). The other NEOs and executive officers’ adjusted long-term incentive mix is comprised of 50% PRSUs, 25% stock options and 25% TRSUs. The mix of target total direct compensation (base salary, target annual incentive awards, and long-term incentive awards) for 2021 was structured to deliver the following approximate proportions of total compensation to our CEO and the other NEOs (on average) if target levels of performance are achieved.

84% of CEO and over 65% of other NEOs Target Pay is Performance-Based

Chief Executive Officer

Totals may not sum due to rounding.

Other NEOs

Totals may not sum due to rounding.

Pay for Performance Alignment

Strong Correlation Between Pay and Performance. A substantial majority of the compensation for our NEOs is performance-based and thus varies with the Company’s actual performance. Based on the Company’s strong financial performance and TSR in 2021, the annual cash bonuses for our CEO and other corporate NEOs were substantially higher than in prior years; however, due to underperformance on TSR in 2019 and 2020, the tranche of PRSUs tied to the Company’s TSR from 2019-2021 vested at 25% of target.

50      

Compensation Discussion and Analysis

Annual Bonus Directly Tied to Crane’s EPS and Free Cash Flow

Annual Period		Minimum		Target		Maximum
2021
2020*
2019

PRSU Vesting Directly Tied to Crane’s Relative TSR

Three-year period		Threshold (25th percentile)		Target (50th percentile)		Maximum (75th percentile)
2019-2021
2018-2020
2017-2019

      51

Compensation Discussion and Analysis

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 Statement/Prospectus Summary and explained in more detail in the “Policies and Practices Related to Our Executive Compensation Program” section beginning on page 62. See “Compensation Best Practices” chart on page 10 for a summary of our compensation best practices.

Compensation Principles

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 Guidelines” on page 62.

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 2021 Decisions

The following table summarizes the major elements of our executive officer compensation program.

52      

Compensation Discussion and Analysis

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 salary level needed to attract the particular executive. We review and determine the amount annually based on the executive’s overall performance, competitive compensation data, level of responsibility, and comparison to other Company executives.

Base salaries for certain executive officers were increased effective January 25, 2021, in connection with annual merit increases. After giving effect to such increases, the base salaries for most of our NEOs were all within the competitive range of +/- 15% in relation to the 50^th percentile of competitive market data per the Committee’s independent compensation consultant, FW Cook.

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 not reflected in the chart above).

Annual Incentive Compensation

We pay our executive officers cash bonuses based on the attainment of Company and business unit performance goals established in January and an assessment of individual performance conducted at the end of the year.

Early in the year, the Committee establishes and approves the annual target bonus objectives and award opportunities for each of our NEOs, subject to review and approval by the Board in the case of the Chief Executive Officer.

In making determinations about performance targets, the Committee considers a variety of factors including financial elements of the annual operating plan, comparison to prior year results, the general business outlook for the coming year, the opinions of analysts who follow the Company, and our diversified industrial manufacturing peers.

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 Committee (the Board in the case of the Chief Executive Officer). Annual incentive plan objectives are not modified during the year, although the Committee may determine to exclude certain special items impacting EPS or free cash flow, either known at the beginning of the year or occurring during the year.

      53

Compensation Discussion and Analysis

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 year in order that full-year performance may be considered. Based on this review, the Committee determines and approves the annual cash bonuses for each of our executive officers.

Annual Incentive Objectives for 2021—CEO and Other Corporate NEOs

Performance metrics for 2021 consisted of EPS and free cash flow (each as adjusted for special items by the Committee for bonus calculation purposes under the Annual Incentive Plan, and which adjustments may in some cases differ from the adjustments made for reporting purposes), weighted 75% / 25% respectively, for the Chief Executive Officer and other corporate NEOs. In addition to the targeted performance goals, for each performance metric, the Committee set minimum threshold and maximum cap values, so that actual payouts could range from 0% to 200% of the target award amounts.

In January 2021, the Committee established an EPS target of $5.22 to align with our annual operating plan. The Committee also established a payout range for EPS from $4.18 (0% payout) to $6.26 (200% payout). For free cash flow, the Committee established a target of $267.1 million with a payout range from $187 million (0% payout) to $347.2 million (200% payout). Actual performance compared to annual incentive objectives for this group were as follows:

54      

Compensation Discussion and Analysis

The graphs below show the performance targets and related ranges set by the Committee in January 2021 and the actual performance in 2021. These corporate financial metrics are adjusted for special items by the Committee for bonus calculation purposes under the Annual Incentive Plan, which adjustments may in some cases differ from the adjustments made for reporting purposes.

Performance Targets and Bonuses for Operations NEOs in 2021

For Messrs. Gallo and Alcala, Senior Vice Presidents with responsibility for certain business operations (Payment & Merchandising Technologies and Engineered Materials in the case of Mr. Gallo, and Process Flow Technologies and operations in China, India and the Middle East & Africa in the case of Mr. Alcala), performance metrics for 2021 were operating profit (70% of target bonus) and free cash flow (30% of target bonus) based on results of the businesses for which they were responsible. While Mr. Maue has operational responsibility for the Aerospace & Electronics segment, his bonus is based solely on his performance as Chief Financial Officer and not his operational responsibilities.

Kurt F. Gallo, Senior Vice President

The performance metrics approved by the Committee for Mr. Gallo were aggregate operating profit of the Payment & Merchandising Technologies and Engineered Materials businesses, with a target of $275.4 million (100% payout) and a payout range from $220.1 million (0% payout) to $330.7 million (200% payout), and aggregate free cash flow from such businesses, with a target of $238.7 million (100% payout) and a payout range from $191.1 million (0% payout) to $286.5 million (200% payout). Actual performance for Mr. Gallo’s businesses compared to these annual incentive objectives are set forth in the tables immediately below.