Kirk Wilson - 13 Feb 2025 Form 4 Insider Report for FLOWSERVE CORP (FLS)

Footnote F1

Includes 43 shares of the issuer's common stock acquired under the Flowserve Employee Stock Purchase Plan in monthly transactions that were exempt under Rule 16b-3.

Footnote F2

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, 2025 and ending on December 31, 2027 which are based equally on: 1) the issuer's ROIC for each calendar year in the performance period measured against the issuer's target ROIC for each calendar year in the performance period; and 2) the issuer's FCF as a percentage of adjusted net income for each calendar year in the performance period measured against the issuer's target FCF as a percentage of adjusted net income for each calendar year in the performance period. The performance rights are also subject to 15% payout modifier (positive or negative) based on the issuer's relative TSR in comparison to the TSR of companies that comprise the S&P 500 Industrials Index for the entire performance period.

Footnote F3

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 March 1, 2025.

Footnote F4

Each performance right represented a contingent right to receive one share of the issuer's common stock at vesting. The performance rights vested at a rate of 76.7% (plus dividends accrued on the underlying shares) based on two factors during the three-year performance cycle beginning on January 1, 2022 and ending on December 31, 2024, which are: 1) the issuer's free cash flow ("FCF") as a percent of adjusted net income for the performance period in comparison to the issuer's targeted free cash flow as a percent of adjusted net income for the performance period; and 2) the issuer's return on invested capital ("ROIC") for each calendar year in the performance period measured against the issuer's targeted ROIC for each calendar year under its operating plan. The performance rights were also subject to a 15% payout modifier (positive or negative) based on the issuer's total shareholder return ("TSR") in comparison to the TSR of peer companies for the entire performance period.