Susan Claire Hudson - May 23, 2022 Form 3 Insider Report for FLOWSERVE CORP (FLS)

Role: Chief Legal Officer
Signature: /s/ Shakeeb U. Mir, attorney-in-fact
Stock symbol: FLS
Transactions as of: May 23, 2022
Transactions value $: $0
Form type: 3
Date filed: 5/24/2022, 05:18 PM
Next filing: Feb 23, 2023

Transactions Table

Type	Sym	Class	Transaction	Value $	Shares	Change %	* Price $	Shares After	Date	Ownership	Footnotes
holding	FLS	Common Stock						2.78K	May 23, 2022	Direct

Derivative Securities (e.g., puts, calls, warrants, options, convertible securities)

Type	Sym	Class	Transaction	Value $	Shares	Change %	* Price $	Shares After	Date	Underlying Class	Amount	Exercise Price	Ownership	Footnotes
holding	FLS	Performance Rights							May 23, 2022	Common Stock	5.7K		Direct	F1
holding	FLS	Restricted Stock Units							May 23, 2022	Common Stock	8.53K		Direct	F2

* An asterisk sign (*) next to the price indicates that the price is likely invalid.

Explanation of Responses:

Id	Content
F1	Each performance right represents a contingent right to receive one share of the issuer's common stock at vesting. The performance rights vest at a rate between 0% and 200% and are based on two factors during a three-year performance cycle beginning on January 1, 2022 and ending on December 31, 2024 which are: 1) the issuer's return on invested capital ("ROIC") measured against the issuer's target ROIC for each calendar year during the performance period; and 2) the issuer's free cash flow ("FCF") as a percentage of net income over the entire performance period. The performance rights are also subject to 15% payout modifier (positive or negative) based on the issuer's relative total shareholder return ("TSR") in comparison to the TSR of companies that comprise the S&P 500 Industrial Index for the entire performance period. The performance rights may be settled, at the issuer's discretion, in cash or shares of common stock.
F2	Each restricted stock unit represents the right to receive, at settlement, one share of common stock (plus dividends accrued on the underlying shares) and are granted to the reporting person pursuant to the issuer's long-term incentive compensation plan for employees. The shares vest ratably over a three-year period on each annual anniversary of the grant.

Content

Each performance right represents a contingent right to receive one share of the issuer's common stock at vesting. The performance rights vest at a rate between 0% and 200% and are based on two factors during a three-year performance cycle beginning on January 1, 2022 and ending on December 31, 2024 which are: 1) the issuer's return on invested capital ("ROIC") measured against the issuer's target ROIC for each calendar year during the performance period; and 2) the issuer's free cash flow ("FCF") as a percentage of net income over the entire performance period. The performance rights are also subject to 15% payout modifier (positive or negative) based on the issuer's relative total shareholder return ("TSR") in comparison to the TSR of companies that comprise the S&P 500 Industrial Index for the entire performance period. The performance rights may be settled, at the issuer's discretion, in cash or shares of common stock.

Each restricted stock unit represents the right to receive, at settlement, one share of common stock (plus dividends accrued on the underlying shares) and are granted to the reporting person pursuant to the issuer's long-term incentive compensation plan for employees. The shares vest ratably over a three-year period on each annual anniversary of the grant.