Graham Corporation (NYSE:GHM) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

Graham Corporation (NYSE:GHM) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

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Item5.02

Departure of Directors or Certain Officers; Election
of Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.

Fiscal 2018 Annual Stock-Based Long-Term Incentive Award Plan
for Senior Executives
. On May31, 2017, the Compensation
Committee of the Board of Directors (the Compensation Committee)
of Graham Corporation (the Company) renewed and amended its
Annual Stock-Based Long-Term Incentive Award Plan for Senior
Executives (the Restricted Stock Bonus Program) for the fiscal
year ending March31, 2018 (Fiscal 2018) and approved grants of
time-vested restricted stock and performance-vested restricted
stock thereunder in the amounts set forth below to the Companys
named executive officers. All grants were made under the Amended
and Restated 2000 Graham Corporation Incentive Plan to Increase
Shareholder Value (the Plan).

Time-vested restricted stock awards are designed to encourage the
Companys named executive officers to remain employed by the
Company. The time-vested restricted stock granted to the Companys
named executive officers vests 33 1/3%per year over three years
and the time-vested restricted stock granted to the Companys
Directors, as described below, vests on the first anniversary of
the date of grant.

Performance-vested restricted stock awards are designed to incent
the Companys named executive officers to focus on Company growth,
align their compensation with the Companys business strategy and
to create stockholder value. Awards of performance-vested
restricted stock vest: (i)50% based upon the Companys achievement
over a three year period of Total Shareholder Return compared to
the Russell 2000 Capital Goods and Energy Composite Ranking
(using a 20 day price average at the start and end of the three
year period commencing April1, 2017 and ending March31, 2020)
(Relative TSR); and (i)50% based on the EBITDA margin of Company
for the fiscal year ending March31, 2020 compared to the Baird
Industrial Company Composite as of December 2019 (Relative
EBITDA). The threshold, target and maximum payout matrixes for
the performance-vested restricted stock are set forth below:

Relative TSR

Threshold 25th percentile 50% payout
Target (1) 50th percentile 50% payout
Maximum 75th percentile 200% payout
(1) If the Companys TSR is negative, maximum payout is Target.

Relative EBITDA

Threshold 40th percentile 50% payout
Target 60th percentile 50% payout
Maximum 75th percentile 200% payout

The number of shares of time-vested restricted stock and
performance-vested restricted stock awarded to the Companys named
executive officers under the Restricted Stock Bonus Program were
determined using a Long-Term Incentive Percentage (the L-T
Percentage) for each such officer. On May31, 2017, the
Compensation Committee set the L-T Percentage for each of the
Companys named executive officers as follows: Mr.Lines 70%;
Mr.Glajch 50%; Mr.Smith 50%; and Ms.Condame 35%. The number of
shares of time-vested restricted stock awarded were determined by
multiplying 50% of each named executive officers base salary in
effect on the date of grant by such officers L-T Percentage, and
then dividing the product by the closing price of the Companys
Common Stock on the NYSE on the date of grant. The number of
shares of performance-vested restricted stock was determined by
multiplying 50% of each named executive officers base salary in
effect on the date of grant by such officers L-T Percentage, and
then dividing the product by the closing price of the Companys
Common Stock on the NYSE on the date of grant. The number of
shares of restricted stock awarded to each of the Companys
Directors was determined by dividing $25,000 by the closing price
of the Companys Common Stock on the NYSE on the date of grant.
The closing price of the Companys Common Stock on the NYSE on
May31, 2017 was $20.93.

Named Executive Officer

Number of Shares of Time-VestedRestricted Stock Granted (1) Number of Shares of Performance-Vested RestrictedStockGranted
(1)(2)(3)

James R. Lines,

President and Chief Executive Officer

7,274 14,548

Jeffrey Glajch,

Vice President of Finance and Administration and Chief
Financial Officer

3,226 6,452

Alan E. Smith,

Vice President of Operations

2,879 5,758

Jennifer R. Condame

Controller and Chief Accounting Officer

1,412 2,824
(1) In the event a named executive officers employment terminates
prior to the conclusion of a vesting for reasons other than
death or disability, such officers right to receive any
unvested time-vested restricted stock is forfeited.
(2) The number of shares that will vest following the conclusion
of Fiscal 2020 is based upon the Companys achievement of
performance criteria. The number of shares set forth above
assumes the maximum achievement of such performance criteria.
If maximum achievement is not realized, any unearned shares
will be forfeited back to the Company. Once the achievement
of the performance measures are determined for Fiscal 2020,
the actual number of shares to which each named executive
officer is entitled will be adjusted accordingly.
(3) In the event a named executive officers employment terminates
prior to the conclusion of Fiscal 2020 for reasons other than
death or disability, such officers right to receive the
performance-vested restricted stock shall be forfeited.

Annual Stock-Based Grant to Non-Employee Directors. Also
on May31, 2017, the Compensation Committee approved the grant of
time-vested restricted stock under the Plan in the amounts set
forth below to the Companys non-employee Directors.

Director

NumberofShares of Time-Vested Restricted Stock Awarded

James Barber

1,194

Alan Fortier

1,194

James Malvaso

1,194

Gerard Mazurkiewicz

1,194

Jonathan Painter

1,194

Lisa Schnorr

1,194

The Restricted Stock Bonus Program in effect for Fiscal 2017 is
attached to this Current Report on Form 8K as Exhibit 99.1 and
the above summary of the Restricted Stock Bonus Program is
qualified in its entirety by reference to such Exhibit.

Fiscal 2017 Annual Executive Cash Bonus Program. On
May31, 2017, the Compensation Committee renewed and amended the
Companys Annual Executive Cash Bonus Program (the Cash Bonus
Program) for Fiscal 2018. The objective of the Cash Bonus Program
is to motivate the Companys named executive officers to attain
short-term objectives through an annual cash bonus related both
to Company and personal performance. On May31, 2017, the
Compensation Committee set target bonus levels under the Cash
Bonus Program for Fiscal 2017 at 50% attainment of both Company
and personal objectives, as follows: Mr.Lines 70% of base salary;
Mr.Glajch 50% of base salary; Mr.Smith 50% of base salary; and
Ms.Condame 35% of base salary. Each named executive officer will
be eligible to receive anywhere from 0% to 200% of his or her
target bonus level depending on the attainment of such
objectives. A summary of the performance goal weightings for the
Companys named executive officers for Fiscal 2018 is as follows:

Named Executive Officer

Consolidated Net Income Consolidated Bookings Personal Goals

James R. Lines

40% 40% 20%

Jeffrey Glajch

40% 40% 20%

Alan E. Smith

40% 40% 20%

Jennifer R. Condame

40% 40% 20%

The Cash Bonus Program in effect for Fiscal 2018 is attached to
this Current Report on Form 8K as Exhibit 99.2 and the above
summary of the Cash Bonus Program is qualified in its entirety by
reference to such Exhibit.

Fiscal 2017 Named Executive Officer Bonuses. On May31,
2017, the Compensation Committee approved the payment of cash
bonuses to the Companys named executive officers, as set forth
below. Such bonuses were approved in accordance with the Companys
Annual Executive Cash Bonus Program in effect for the fiscal year
ending March31, 2017 (Fiscal 2017) and were based on the Companys
achievement during Fiscal 2017 of net income and profitability of
executable backlog as well as the achievement of personal
objectives by each named executive officer during such year.

Named Executive Officer

TotalFiscal 2017Bonus

James R. Lines

$ 121,800

Jeffrey Glajch

$ 67,531

Alan E. Smith

$ 72,306

Jennifer R. Condame

$ 38,999
Item9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.

Description

99.1 Graham Corporation Annual Stock-Based Long-Term Incentive
Award Plan for Senior Executives in effect for the fiscal
year ending March 31, 2018.
99.2 Graham Corporation Annual Executive Cash Bonus Program in
effect for the fiscal year ending March 31, 2018.


About Graham Corporation (NYSE:GHM)

Graham Corporation designs, manufactures and sells critical equipment for the energy, defense and chemical/petrochemical industries. The Company designs and manufactures custom-engineered ejectors, vacuum pumping systems, surface condensers and vacuum systems. It is a nuclear code accredited fabrication and specialty machining company. It supplies components used inside reactor vessels and outside containment vessels of nuclear power facilities. Its equipment is found in applications, such as metal refining, pulp and paper processing, water heating, refrigeration, desalination, food processing, pharmaceutical, heating, ventilating and air conditioning. For the defense industry, its equipment is used in nuclear propulsion power systems for the United States Navy. The Company’s products are used in a range of industrial process applications in energy markets, including petroleum refining, defense, chemical and petrochemical processing, power generation/alternative energy and other.

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