Company: GGG
Filing Date: 2025-03-12
Form Type: DEF 14A
Source: 0001193125-25-052581
Chunk: 58

Company: GRACO INC
Filing Date: 2025-03-12
Form: DEF 14A
Chunk 58
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 Net Sales and 30% regional Incentive EPS for NEOs with regional leadership responsibility. Incentive EPS, worldwide divisional Incentive EPS and regional Incentive EPS exclude certain purchase accounting and one-timetransaction costs related to acquisitions and divestitures, the initial valuation of acquisitions and potential earn out adjustments, and the effects of excess tax benefits from stock option exercises. Description of Certain Relationships The charts below provide a graphic description of the relationship: (i) between the Company’s cumulative total shareholder return and peer group cumulative total shareholder return; (ii) between (A) CAP to the CEOs and the average CAP to the non-CEONEOs, and (B) the Company’s cumulative total shareholder return; (iii) between (A) CAP to the CEOs and the average CAP to the non-CEONEOs, and (B) the Company’s net income; and (iv) between (A) CAP to the CEOs and the average CAP to the non-CEONEOs, and (B) the Company’s Net Sales. 43 Graco Inc. 2025 Proxy Statement

44 Graco Inc. 2025 Proxy Statement Supplemental Pay Versus Performance Disclosure As discussed in the Compensation Discussion and Analysis section of this Proxy Statement, paying for performance is the cornerstone of the Company’s compensation philosophy and program. The MOCC uses Net Sales and Incentive EPS growth as the sole metrics for our short-term cash incentive plan, and stock options as the sole vehicle for our long-term incentive plan, to motivate our executives to attain annual and long-term goals and operational growth for the Company, and to align our executives’ interests with our shareholders’ interests in creating long-term shareholder value. As depicted in the chart below, over the past 10 years the Company’s cumulative total shareholder return has been 255% versus 243% for the S&P 500 and 227% for the Dow Jones U.S. Industrial Machinery Index. The MOCC believes these results demonstrate the use of Net Sales and Incentive EPS growth as the sole metrics in our short-term incentive program and stock options as the sole vehicle in our long-term incentive program have been highly effective in aligning our executives’ interests with our shareholders’ interests in creating shareholder value over the long term. 45 Graco Inc. 2025 Proxy Statement

Policies and Practices Related to the Grant of Certain Equity Awards We do not have any formal policy that requires us to grant, or avoid granting, equity awards to our executive officers