SIFCO INDUSTRIES, INC. 2007 LONG-TERM INCENTIVE PLAN
(Amended and Restated as of November 17, 2016)

Performance Share Award Agreement

THIS PERFORMANCE SHARE AWARD AGREEMENT (“Award Agreement”) is made and entered
into effective as of _________ (“Grant Date”) by and between SIFCO INDUSTRIES,
INC., an Ohio corporation (the “Company”), and __________, an Employee of the
Company (the “Grantee”).
In recognition of the value of Grantee’s service as a key employee of the
Company and/or its Affiliates, the Committee hereby awards the Grantee
Performance Shares under the Plan, subject to the following terms and
conditions. Unless otherwise defined herein, capitalized terms shall have the
meanings ascribed to them in the SIFCO Industries, Inc. 2007 Long-Term Incentive
Plan, as amended and restated (the “Plan”).
1.Award. Subject to the conditions set forth herein, the Company hereby grants
to Grantee, as of the Grant Date specified above, an Award of ______ Performance
Shares (“PSs”) which may be earned in accordance with Section 2. This represents
the maximum number of Performance Shares that can be earned. Your target number
of Performance Shares, awarded at Target Performance as defined in Section 2, is
________ (“Target Award”).
2.Performance Vesting. Subject to Sections 4, 5 and 6, the Company shall deliver
to Grantee one share of Stock for each whole Performance Share that is earned in
accordance with the following schedule:
Performance Level Achieved
3 Yr. Average EBITDA Margin Performance Measure
Vested PSs for EBITDA Margin Performance Measure
Minimum
Performance goals to be inserted
0%
 
Performance goals to be inserted
50%
Target
Performance goals to be inserted
100%
 
Performance goals to be inserted
150%
Maximum
Performance goals to be inserted
200%

    

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Company shall interpolate amounts for the three year average EBITDA Margin
performance results that fall between the minimum and maximum thresholds. The
Performance Measure achieved may be evaluated and adjusted as provided in
Sections 13.6.5 and 13.6.6 of the Plan.
3.Delivery of Shares. The number of shares of Stock that Grantee earns, if any,
as a result of the vesting of Grantee’s PSs under Sections 2 will be delivered
to Grantee within the Specified Date. Before such delivery, the Committee shall
certify in writing the number of Performance Shares that you have earned. No
fractional shares will be delivered pursuant to this Award.
4.Employment Termination. Except as provided in Sections 5 and 6, if Grantee
incurs a Separation from Service before the end of the Performance Period, this
Award of Performance Shares shall be forfeited on the date of such Separation
from Service. In the event that Grantee is re-employed by the Company during the
same Performance Period and after no more than twelve consecutive months of
Separation from Service, Grantee’s Award will be reinstated. At the conclusion
of the Performance Period, the number of PSs earned will be prorated to reflect
the number of full months of service completed during the Performance Period.
5.Retirement, Death or Disability. If Grantee’s Separation from Service occurs
during the Performance Period, because of Grantee’s retirement on or after the
age of 65, death or Disability, Grantee will be entitled to a prorated portion
of the PSs earned in accordance with Section 2, determined at the end of the
Performance Period based on the ratio of the number of days Grantee is employed
during the Performance Period to the total number of days in the Performance
Period. It is the intention of the Company and Grantee that this provision
comply with Treasury Regulation Section 1.162-27(e)(2)(i), and that no PSs will
vest and no shares of Stock will be delivered unless the Performance Measures
are met as specified in Section 2 of this Award Agreement. Any
payouts/deliveries of Stock due as a result of Grantee’s death shall be paid to
Grantee’s estate (or Grantee’s designated beneficiary) within the Specified Date
after the end of the Performance Period as specified in Section 3 hereof.
6.Change in Control.
(a)    In General. Unless previously forfeited, or limited pursuant to Section
6(b), the Award shall vest in full if (i) a Corporate Transaction occurs, and
(ii) either (x) Grantee incurs a Separation from Service within twelve months
following such Corporate Transaction, other than a Separation from Service by
the Company for Cause or a Separation from Service by Grantee other than as a
result of a reduction in Grantee’s title, duties or compensation, a proposed
relocation of Grantee, or Grantee’s death or Disability; or (y) the Company does
not survive as a standalone entity following such Corporate Transaction, or the
Award is terminated in connection with the Corporate Transaction.
(b)    Preclusion of Vesting in Certain Instances. Notwithstanding any other
provision of this Award Agreement or of any other agreement, contract, or
understanding heretofore or hereafter entered into by a Grantee with the Company
or any Affiliate, except an agreement, contract, or understanding that expressly
addresses Section 280G or Section 4999 of the Code (an

    

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“Other Agreement”), and notwithstanding any formal or informal plan or other
arrangement for the direct or indirect provision of compensation to the Grantee
(including groups or classes of Grantees or beneficiaries of which the Grantee
is a member), whether or not such compensation is deferred, is in cash, or is in
the form of a benefit to or for the Grantee (a “Benefit Arrangement”), if the
Grantee is a “disqualified individual,” as defined in Section 280G(c) of the
Code, any PS held by the Grantee and any right to receive any payment or other
benefit under this Award Agreement shall not become vested (i) to the extent
that such right to vesting, payment, or benefit, taking into account all other
rights, payments, or benefits to or for the Grantee under this Award Agreement,
all Other Agreements, and all Benefit Arrangements, would cause any payment or
benefit to the Grantee under this Award Agreement to be considered a “parachute
payment” within the meaning of Section 280G(b)(2) of the Code as then in effect
(a “Parachute Payment”) and (ii) if, as a result of receiving a Parachute
Payment, the aggregate after-tax amounts received by the Grantee from the
Company under this Award Agreement, all Other Agreements, and all Benefit
Arrangements would be less than the maximum after-tax amount that could be
received by the Grantee without causing any such payment or benefit to be
considered a Parachute Payment.
(c)    Time and Form of Payment. Within 70 days after the close of the Corporate
Transaction, the Company shall deliver, at its sole discretion, either (i) one
share of stock for each vested PS, or (ii) the cash equivalent of one share of
stock for each vested PS, which payout/delivery shall be in lieu of any
payout/delivery under Section 2; provided that if such 70-day period begins in
one calendar year and end in another, the Grantee shall not have the right to
designate the year of payment; and, provided further, that the cash equivalent
shall be determined using the imputed value as of the close of the Corporate
Transaction. The Company and Grantee acknowledge that Treasury Regulation
Section 1.162-27(e)(2)(v) applies to this Corporate Transaction situation.
(d)    Award Agreement Controls. Only the provisions of this Section 6, and not
the provisions of any other change in control agreement or other agreement
containing change in control provisions, shall apply to the Award.
7.Transferability. The PSs shall not be sold, pledged, assigned, hypothecated,
transferred or disposed of in any manner, whether by the operation of law or
otherwise. Any attempted transfer of the PSs prohibited by this Section 7 shall
be null and void.
8.Adjustments. The PSs shall be subject to adjustment in accordance with the
Plan.
9.Withholding. Grantee is responsible for all applicable federal, state and
local income and employment taxes (including taxes of any foreign jurisdiction)
which the Company is required to withhold at any time with respect to the PSs to
satisfy its minimum statutory withholding requirements. Such payment shall be
made in full at Grantee’s election, by check made payable to the Company, or by
Grantee’s tender of shares of Stock payable under this Award. Shares of Stock
tendered as payment of required withholding shall be valued at Fair Market Value
on the date such withholding obligation arises or at the imputed value as of the
close of the Corporate Transaction if the stock ceases to exist as a result of a
Corporate Transaction.

    

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10.Miscellaneous.
(a)    Disclaimer of Rights. Nothing contained herein shall constitute an
obligation for continued employment.
(b)    Rights Unsecured. Grantee only has the Company’s unfunded, unsecured
promise to pay pursuant to the terms of this Award. Grantee’s rights shall be
that of an unsecured general creditor of the Company and Grantee shall not have
any security interest in any assets of the Company.
(c)    Adjustment for Dividends. Upon the declaration of any dividend on shares
of Stock of the Company to shareholders of record as of a date after the end of
the Performance Period but before the issuance of a stock certificate
representing the earned Award, the number of PSs shall be increased by the
number obtained by dividing (x) the aggregate amount of the dividend that would
be payable to Grantee if each of Grantee’s PSs were issued and outstanding and
entitled to dividends on the dividend shareholder of record date, by (y) the
Fair Market Value of the Company’s common stock on the shareholder of record
date.
(d)    Terms of Plan. The Award is subject to the terms and conditions set forth
in the Plan, which are incorporated into and shall be deemed to be a part of
this Award, without regard to whether such terms and conditions are otherwise
set forth in this Award. In the event that there is any inconsistency between
the provisions of this Award and of the Plan, the provisions of the Plan shall
govern.
(e)    Severability. If any term, provision, covenant or restriction contained
herein is held by a court or a federal regulatory agency of competent
jurisdiction to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions contained herein shall remain in full
force and effect, and shall in no way be affected, impaired or invalidated.
(f)    Controlling Law. The Award shall be construed, interpreted and applied in
accordance with the laws of the State of Ohio, without giving effect to the
choice of law provisions thereof. Grantee agrees to irrevocably submit any
dispute arising out of or relating to this Award to the exclusive concurrent
jurisdiction of the state and federal courts located in Cleveland, Ohio. Grantee
also irrevocably waives to the fullest extent permitted by applicable law, any
objection Grantee may now or hereafter have to the laying of venue of any such
dispute brought in such court or any defense of inconvenient forum for the
maintenance of such dispute, and agrees to accept service of legal process from
the courts of Ohio.
(g)    Section 409A Compliance. To the extent applicable, it is intended that
this Award and the Plan comply with Section 409A. This Award and the Plan shall
be interpreted and administered in a manner consistent with this intent, and any
provision that would cause the Award or the Plan to fail to satisfy Section 409A
shall have no force and effect unless or until amended to comply with Section
409A (which amendment may be retroactive to the extent permitted by Section 409A
and may be made by the Company without Grantee’s consent).

    

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(h)    Headings. Section and other headings contained in this Award Agreement
are for reference purposes only and are in no way intended to describe,
interpret, defined or limit the scope, extent or intent of the Award or any
provision hereof or of the Plan.
11.Definitions. As used herein the following terms shall be defined as set forth
below:
(a)     “EBITDA Margin” means earnings from continuing operations before
interest, taxes, depreciation and amortization, adjusted for LIFO, and then
divided by Net Sales.
(b)    “Performance Period” means the Company’s three (3) consecutive fiscal
years commencing with the fiscal year beginning October 1, 2016, and ending with
the fiscal year ending September 30, 2019.
(c)    “Specified Date” means any day during the period that begins on December
1, 2019, and that ends on February 15, 2020.
IN WITNESS WHEREOF, the Company has caused this Award Agreement to be duly
executed, and the Grantee has hereunto set his or her hand, all as of the day
and year first above written.

 
SIFCO INDUSTRIES, INC.

By:                                                             
Its: President and Chief Executive Officer
 
 
 
GRANTEE:

Signature: