SHAREHOLDERS' EQUITY AND EQUITY COMPENSATION

9 Months Ended

Jun. 30, 2025

Stockholders' Equity Note [Abstract]

SHAREHOLDERS' EQUITY AND EQUITY COMPENSATION

SHAREHOLDERS’ EQUITY AND EQUITY COMPENSATION

During the nine months ended June 30, 2025, the Company paid three quarterly cash dividends each for $0.18 per share each. During 2024, the Company paid four quarterly cash dividends each for $0.15 per share, totaling $0.60 per share.

The Company currently intends to pay dividends each quarter; however, payment of dividends is determined by the Board of Directors at its discretion based on various factors, and no assurance can be provided as to the payment of future dividends. Dividends paid on shares in Griffon's Employee Stock Ownership Plan (the “ESOP”) were used to offset ESOP compensation expense. For all dividends, a dividend payable is established for the holders of restricted shares; such dividends will be released upon vesting of the underlying restricted shares.

The ESOP was frozen as of September 30, 2024; this means that, for plan years after this date, no additional employees will become participants under the ESOP and no new voluntary contributions will be made to the ESOP. Prior to this date, the Company’s U.S. employees who were not members of a collective bargaining agreement and met certain eligibility requirements became participants in the ESOP. During the first quarter ended December 31, 2024 the final loan payment was made by the ESOP to the Company and compensation expense for the period was fully offset by dividends paid. As of December 31, 2024 there were 4,166,038 shares of common stock in the ESOP, all of which were allocated to participant accounts.

On August 5, 2025, the Board of Directors declared a quarterly cash dividend of $0.18 per share, payable on September 16, 2025 to shareholders of record as of the close of business on August 29, 2025.

On January 29, 2016, shareholders approved the Griffon Corporation 2016 Equity Incentive Plan (the "Original Incentive Plan") pursuant to which, among other things, awards of performance shares, performance units, stock options, stock appreciation rights, restricted shares, restricted stock units, deferred shares and other stock-based awards may be granted. On January 31, 2018, shareholders approved Amendment No. 1 to the Original Incentive Plan pursuant to which, among other things, 1,000,000 shares were added to the Original Incentive Plan; on January 30, 2020, shareholders approved Amendment No. 2 to the Original Incentive Plan, pursuant to which 1,700,000 shares were added to the Original Incentive Plan; on February 17, 2022, shareholders approved the Amended and Restated 2016 Equity Incentive Plan (the “Amended Incentive Plan”), which amended and restated the Original Incentive Plan and pursuant to which, among other things, 1,200,000 shares were added to the Original Incentive Plan; and on March 20, 2024, shareholders approved an amendment to add 2,600,000 shares to the Amended Incentive Plan. Options granted under the Amended Incentive Plan may be either “incentive stock options” or nonqualified stock options, generally expire ten years after the date of grant and are granted at an exercise price of not less than 100% of the fair market value at the date of grant. The maximum number of shares of common stock available for award under the Amended Incentive Plan is 8,850,000 (600,000 of which may be issued as incentive stock options), plus (i) any shares that were reserved for issuance under the Original Incentive Plan as of the effective date of the Original Incentive Plan, and (ii) any shares underlying awards outstanding on such date under the 2011 Incentive Plan that were subsequently canceled or forfeited. As of June 30, 2025, there were 1,889,293 shares available for grant.

Compensation expense for restricted stock and restricted stock units is recognized ratably over the required service period based on the fair value of the grant, calculated as the number of shares or units granted multiplied by the stock price on the date of grant, and for performance shares, including performance units, the likelihood of achieving the performance criteria. The Company recognizes forfeitures as they occur. Compensation expense for restricted stock granted to four senior executives is calculated as the maximum number of shares granted, upon achieving certain performance criteria or market conditions, multiplied by the stock price as valued by a Monte Carlo Simulation Model. Compensation cost related to stock-based awards with graded vesting, generally over a period of 3 years, is recognized using the straight-line attribution method and recorded within SG&A expenses.

The following table summarizes the Company’s compensation expense relating to all stock-based incentive plans:


	Three Months Ended June 30,				Nine Months Ended June 30,
	2025		2024		2025		2024
Restricted stock	$	5,968	$	4,699	$	17,861	$	13,576
ESOP1	—		2,353		—		6,150
Total stock-based compensation	$	5,968	$	7,052	$	17,861	$	19,726

________________________

1.During the nine months ended June 30, 2025, the final loan payment was made by the ESOP to the Company and compensation expense for the period was fully offset by dividends paid.

During the first quarter of 2025, Griffon granted 142,911 shares of restricted stock and restricted stock units ("RSUs") to 43 executives and key employees, subject to certain performance conditions, with a vesting period of thirty-six months and a total fair value of $9,735, or a weighted average fair value of $68.12 per share. During the first quarter of 2025, Griffon also granted 436,947 shares of restricted stock to four senior executives with a vesting period of thirty-six months and a two-year post-vesting holding period, subject to the achievement of certain performance criteria or market conditions, relating to required levels of return on invested capital and the relative total shareholder return of Griffon's common stock as compared to a market index. So long as the minimum performance conditions are attained, the amount of shares that can vest will range from a minimum of 72,827 to a maximum of 436,947, with the target number of shares being 145,649. The total estimated fair value of these restricted shares, assuming achievement of the performance conditions at target, is $12,372, or a weighted average fair value of $84.95 per share. During the second quarter of 2025, Griffon granted 15,940 shares of restricted stock to non-employee directors of Griffon with a vesting period of one year and a fair value of $1,100, or a weighted average fair value of $69.03 per share. During the third quarter of 2025, there were no shares of restricted stock or RSUs granted.

On November 13, 2024, Griffon announced that the Board of Directors approved an additional increase of $400,000 to its share repurchase authorization. Under the authorized share repurchase program, the Company may, from time to time, purchase shares of its common stock in the open market, including pursuant to a 10b5-1 plan, pursuant to an accelerated share repurchase

program or issuer tender offer, or in privately negotiated transactions. Share repurchases during the quarter and nine months ended June 30, 2025 totaled 581,082 shares and 1,611,454 shares of common stock, respectively, for a total of $40,257 and $113,125, respectively, or an average of $69.28 per share and $70.20 per share, respectively. This excludes excise taxes incurred for share repurchases of $396 and $1,112, for the quarter and nine months ended June 30, 2025, respectively. As of June 30, 2025, $319,568 remains available under Griffon's Board authorized repurchase program.

Share repurchases during the quarter and nine months ended June 30, 2024 totaled 283,479 shares and 3,721,357 shares of common stock, respectively, for a total of $19,080 and $206,104, respectively, or an average of $67.31 per share and $55.38 per share, respectively.

The share repurchases during the nine months ended June 30, 2024 include the repurchase of 1,500,000 shares of common stock, par value $0.25 per share, by the Company on February 20, 2024 pursuant to a stock purchase and cooperation agreement executed by the Company and Voss Value Master Fund, L.P., Voss Value-Oriented Special Situations Fund, L.P. and four separately managed accounts of which Voss Capital, LLC is the investment manager, in a private transaction. The purchase price per share was $65.50, for an aggregate purchase price of $98,250.

During the nine months ended June 30, 2025, 583,893 shares, with a market value of $45,277, or $77.54 per share, were withheld to settle employee taxes due upon the vesting of restricted stock, and were added to treasury stock. There were no shares withheld to settle employee taxes due upon vesting of restricted stock during the three months ended June 30, 2025. This excludes excise tax benefits of $528 for the nine months ended June 30, 2025.

- Definition

The entire disclosure for equity.

+ References

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+ Details

GRIFFON CORP 10-Q