UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): February 3, 2006
GRIFFON CORPORATION
(Exact Name of Registrant as Specified in Charter)
Delaware 1-6620 11-1893410
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification Number)
100 Jericho Quadrangle Jericho, Suite 224, New York 11753
(Address of Principal Executive Offices) (Zip Code)
(516) 938-5544
(Registrant's telephone number, including area code)
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Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01. Entry into a Material Definitive Agreement.
On February 3, 2006, the stockholders of Griffon Corporation (the
"Company") approved the 2006 Equity Incentive Plan (the "Equity Incentive
Plan"). On the same date, the stockholders of the Company approved the 2006
Performance Bonus Plan (the "Performance Bonus Plan"). Each of these plans was
adopted by the Board of Directors of the Company on December 6, 2005. The Equity
Incentive Plan was effective as of February 3, 2006 and the Performance Bonus
Plan was effective as of December 5, 2005, subject to the stockholder approval
obtained on February 3, 2006.
The summary of the Equity Incentive Plan and the Performance Bonus Plan
are qualified in their entirety by reference to the Equity Incentive Plan and
the Performance Bonus Plan, copies of which are filed as exhibits to this
report.
2006 Equity Incentive Plan
The Equity Incentive Plan authorizes the grant of Performance Shares,
Performance Units, Options (incentive stock options and nonqualified stock
options), Stock Appreciation Rights, Restricted Shares and Deferred Shares
(collectively called "Awards"). Pursuant to the Equity Incentive Plan, the
number of shares of common stock initially available for award is 1,700,000
shares (600,000 of which may be issued as incentive stock options). The number
of shares available for issuance will be reduced by a factor of two to one for
each share issued pursuant to an Award other than an Option. The maximum number
of shares that may be awarded to a participant in any fiscal year shall not in
the aggregate exceed 500,000 with respect to Option Awards or 250,000 with
respect to any Award other than an Option.
The Equity Incentive Plan will be administered by the Compensation
Committee (the "Committee") of the Board of Directors. Subject to the other
provisions of the Equity Incentive Plan, the Committee has the authority to
interpret the Equity Incentive Plan, establish and amend rules and regulations
relating to the Equity Incentive Plan, select the participants and determine the
type of Awards to be made to participants, the number of shares subject to
Awards and the terms, conditions, restrictions and limitations of Awards, and
make all other determinations it deems necessary or advisable for the
administration of the Equity Incentive Plan. The Committee may also delegate to
one or more officers of the Company the authority to grant Awards to
participants who are not subject to Section 16 of the Exchange Act or Section
162(m) of the Internal Revenue Code of 1986, as amended (the "Code").
Each grant of Performance Shares and Performance Units will specify the
performance objectives that must be achieved in order for payment to be made.
Each grant of Options or SARs shall specify the length of service and/or any
applicable performance goals that must be achieved before it becomes
exercisable. Each grant of Restricted Shares shall specify the duration of the
restriction period and any other conditions that under which the Restricted
Shares would be forfeitable to the Company, including any applicable performance
goals. Each grant of Deferred Shares shall specify the deferral period and any
other conditions to which future delivery of shares to the recipient is subject,
including any applicable performance goals. Each grant may provide for the early
exercise of rights or termination of a restriction or deferral period in the
event of a change in control or similar transaction or event.
The Board of Directors of the Company has the authority to amend or
terminate the Equity
Incentive Plan at any time, provided, however, that stockholder approval is
required for any amendment, which (i) increases the number of shares available
for Awards under the Equity Incentive Plan (other than to reflect a change in
the Company's capital structure), ii) increases the maximum number of shares
allowed for grants to any participant, (iii) changes the class of persons
eligible to receive grants of Awards or the types of Awards available under the
Equity Incentive Plan, (iv) increases the benefits to participants under the
Equity Incentive Plan, or (v) as otherwise required by applicable law or under
the rules of any applicable exchange. Further, no Award may be repriced,
replaced, regranted through cancellation, or modified without stockholder
approval. Finally, the Equity Incentive Plan will terminate automatically ten
years after it is approved by stockholders.
2006 Performance Bonus Plan
Section 162(m) of the Code disallows a deduction to the Company for any
compensation paid to a "Covered Employee" in excess of $1 million per year,
subject to certain exceptions. In general, "Covered Employees" include the chief
executive officer and the four most highly compensated executive officers of the
Company. Among other exceptions, the deduction limit does not apply to
compensation that meets the specified requirements for "performance-based
compensation." The Performance Bonus Plan will permit incentive compensation
bonus awards to be structured to qualify as "performance-based" compensation
under Section 162(m) of the Code.
All employees of the Company are eligible to participate in the Performance
Bonus Plan. The maximum amount of the incentive compensation bonuses payable to
any participant under the Performance Bonus Plan in, or in respect of, any
single fiscal year shall not exceed $5 million. All incentive compensation
bonuses paid pursuant to the Performance Bonus Plan will be paid in cash.
The Committee will administer the Performance Bonus Plan. Subject to the
other provisions of the Performance Bonus Plan, the Committee has the authority
to interpret the Performance Bonus Plan, establish and amend rules and
regulations relating to the Performance Bonus Plan, select the participants and
establish the performance goals and determine the amounts of incentive
compensation payable to any participant upon satisfaction of a performance goal,
establish the terms and conditions of any performance based incentive
compensation bonus opportunity; and make all other determinations it deems
necessary or advisable for the administration of the Performance Bonus Plan.
The Committee may also delegate to one or more executive officers of
the Company the authority to administer the Performance Bonus Plan with respect
to any participants who are not Covered Employees. The Committee may also, at
any time and from time to time, alter, amend, suspend or terminate the
Performance Bonus Plan in whole or in part. However, no such amendment shall be
effective which alters any grant, performance target or other criteria relating
to any grant to a Covered Employee for the performance period in which such
amendment is made or any prior performance period, except as such amendment may
be made without causing such grant to cease to qualify as performance-based
compensation under Section 162(m) of the Code.
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Item 9.01. Exhibits.
(d) Exhibits.
10.1. Griffon Corporation 2006 Equity Incentive Plan
10.2. Griffon Corporation 2006 Performance Bonus Plan
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SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GRIFFON CORPORATION
By:/s/Eric P. Edelstein
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Eric P. Edelstein
Executive Vice President and
Chief Financial Officer
Date: February 17, 2006
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Exhibit Index
10.1. Griffon Corporation 2006 Equity Incentive Plan
10.2. Griffon Corporation 2006 Performance Bonus Plan