EXHIBIT 10.1
 
THERMON GROUP HOLDINGS, INC.
2012 SHORT-TERM INCENTIVE PLAN
 
Purposes
 
        The purpose of the Thermon Group Holdings, Inc. Incentive Plan (the
"Plan") is to retain and motivate the officers and other employees of Thermon
Group Holdings, Inc. and its subsidiaries who have been designated by the
Committee to participate in the Plan for a specified Performance Period by
providing them with the opportunity to earn incentive payments based upon the
extent to which specified performance goals have been achieved or exceeded for
the Performance Period. It is intended that all amounts payable to Participants
who are "covered employees" within the meaning of Section 162(m) of the Code
will constitute "qualified performance-based compensation" within the meaning of
U.S. Treasury regulations promulgated thereunder, and the Plan and the terms of
any Awards hereunder shall be so interpreted and construed to the maximum extent
possible.
 
Definitions
 
         " Annual Base Salary " shall mean for any Participant an amount equal
to the rate of annual base salary in effect or approved by the Committee or
other authorized person at the time or immediately before performance goals are
established for a Performance Period, including any base salary that otherwise
would be payable to the Participant during the Performance Period but for his or
her election to defer receipt thereof.
 
         " Applicable Period " shall mean, with respect to any Performance
Period, a period commencing on or before the first day of the Performance Period
and ending not later than the earlier of (a) the 90 th day after the
commencement of the Performance Period and (b) the date on which twenty-five
percent (25%) of the Performance Period has elapsed. Any action required to be
taken within an Applicable Period may be taken at a later date if permissible
under Section 162(m) of the Code or U.S. Treasury regulations promulgated
thereunder.
 
         " Award " shall mean an award to which a Participant may be entitled
under the Plan if the performance goals for a Performance Period are satisfied.
An Award may be expressed in U.S. dollars or pursuant to a formula that is
consistent with the provisions of the Plan.
 
         " Board " shall mean the Board of Directors of the Company.
 
         " Code " shall mean the Internal Revenue Code of 1986, as amended.
 
         " Committee " shall mean the Compensation Committee of the Board
comprised of members of the Board that are "outside directors" within the
meaning of Section 162(m) of the Code, or such other committee designated by the
Board that satisfies any then applicable requirements of the principal national
stock exchange on which the common stock of the Company is then traded to
constitute a compensation committee, and which consists of two or more members
of the Board, each of whom is an "outside director" within the meaning of
Section 162(m) of the Code.
 
         " Company " shall mean Thermon Group Holdings, Inc., a Delaware
corporation, and any successor thereto.
 
         " Participant " shall mean an officer or other employee of the Company
or any of its subsidiaries who is designated by the Committee to participate in
the Plan for a Performance Period, in accordance with Article III.
 
         " Performance Period " shall mean any period commencing on or after
April 1, 2012 for which performance goals are established pursuant to
Article IV. A Performance Period may be coincident with one or more fiscal years
of the Company or a portion of any fiscal year of the Company.
 
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         " Plan " shall mean the Thermon Group Holdings, Inc. Incentive Plan as
set forth herein, as it may be amended from time to time.
 
Administration
 
        General.     The Plan shall be administered by the Committee, which
shall have the full power and authority to interpret, construe and administer
the Plan and Awards granted hereunder (including in each case reconciling any
inconsistencies, correcting any defaults and addressing any omissions). The
Committee's interpretation, construction and administration of the Plan and all
its determinations hereunder shall be final, conclusive and binding on all
persons for all purposes.
 
        Powers and Responsibilities.     The Committee shall have the following
discretionary powers, rights and responsibilities in addition to those described
in Section 3.1 .
 

 
(a)
to designate within the Applicable Period the Participants for a Performance
Period;

 
(b)
to establish within the Applicable Period the performance goals and targets and
other terms and conditions that are to apply to each Participant's Award;

 
(c)
to certify in writing prior to the payment with respect to any Award that the
performance goals for a Performance Period and other material terms applicable
to the Award have been satisfied;

 
(d)
subject to Section 409A of the Code, to determine whether, and under what
circumstances and subject to what terms, an Award is to be paid on a deferred
basis, including whether such a deferred payment shall be made solely at the
Committee's discretion or whether a Participant may elect deferred payment; and

 
(e)
to adopt, revise, suspend, waive or repeal, when and as appropriate, in its sole
and absolute discretion, such administrative rules, guidelines and procedures
for the Plan as it deems necessary or advisable to implement the terms and
conditions of the Plan.

 
        Delegation of Power.     The Committee may delegate some or all of its
power and authority hereunder to the Chief Executive Officer or other executive
officer of the Company as the Committee deems appropriate; provided , however ,
that with respect to any person who is a "covered employee" within the meaning
of Section 162(m) of the Code or who, in the Committee's judgment, is likely to
be a covered employee at any time during the applicable Performance Period or
during any period in which an Award may be paid following a Performance Period,
only the Committee shall be permitted to (a) designate such person to
participate in the Plan for such Performance Period, (b) establish performance
goals and Awards for such person, and (c) certify the achievement of such
performance goals.
 
Performance Goals
 
        Establishing Performance Goals.     The Committee shall establish within
the Applicable Period of each Performance Period one or more objective
performance goals (the outcome of which, when established, shall be
substantially uncertain) for each Participant or for any group of Participants
(or both). Performance goals shall be based exclusively on one or more of the
following objective corporate-wide or subsidiary, division, operating unit or
individual measures: the attainment by a share of the Company's common stock of
a specified fair market value for a specified period of time, earnings per
share, return to stockholders (including dividends), return on assets, return on
equity, our earnings before or after taxes and/or interest, revenues, expenses,
market share, cash flow or cost reduction goals, interest expense after taxes,
return on investment, return on investment capital, return on operating costs,
economic value created, operating margin, gross margin, achievement of annual
operating profit plans, net income before or after taxes, pretax earnings before
interest, depreciation
 
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and/or amortization, pretax operating earnings after interest expense and before
incentives, and/or extraordinary or special items, operating earnings, net cash
provided by operations, and strategic business criteria, consisting of one or
more objectives based on meeting specified market penetration, geographic
business expansion goals, cost targets, days sales outstanding goals, customer
satisfaction, attainment of specified safety metrics, reductions in errors and
omissions, reductions in lost business, management of employment practices and
employee benefits, supervision of litigation and information technology, quality
and quality audit scores, productivity, efficiency, and goals relating to
acquisitions or divestitures, or any combination of the foregoing. Each such
goal may be expressed on an absolute or relative basis and may include
comparisons based on current internal targets, the past performance of the
Company (including the performance of one or more subsidiaries, divisions, or
operating units) or the past or current performance of other companies (or a
combination of such past and current performance). In the case of earnings-based
measures, in addition to the ratios specifically enumerated above, performance
goals may include comparisons relating to capital (including, but not limited
to, the cost of capital), stockholders' equity, shares outstanding, assets or
net assets, or any combination thereof. With respect to Participants who are not
"covered employees" within the meaning of Section 162(m) of the Code and who, in
the Committee's judgment, are not likely to be covered employees at any time
during the applicable Performance Period or during any period in which an Award
may be paid following a Performance Period, the performance goals established
for the Performance Period may consist of any objective or subjective
corporate-wide or subsidiary, division, operating unit or individual measures,
whether or not listed herein. Performance goals shall be subject to such other
special rules and conditions as the Committee may establish at any time within
the Applicable Period; provided , however , that to the extent such goals relate
to Awards to "covered employees" within the meaning of Section 162(m) of the
Code, such special rules and conditions shall not be inconsistent with the
provisions of Treasury regulation Section 1.162-27(e) or any successor
regulation describing "qualified performance-based compensation."
 
        Impact of Extraordinary Items or Changes in Accounting.     The measures
utilized in establishing performance goals under the Plan shall, to the extent
applicable ( i.e ., if the relevant performance goal is based on a GAAP
measure), be determined in accordance with GAAP and in a manner consistent with
the methods used in the Company's audited consolidated financial statements,
without regard to (a) extraordinary or other nonrecurring or unusual items, as
determined by the Company's independent public accountants in accordance with
GAAP, (b) changes in accounting, as determined by the Company's independent
public accountants in accordance with GAAP, or (c) special charges, such as
restructuring or impairment charges, unless, in each case, the Committee decides
otherwise within the Applicable Period or as otherwise required under
Section 162(m) of the Code.
 
Terms of Awards
 
        Performance Goals and Targets.     At the time performance goals are
established for a Performance Period, the Committee also shall establish an
Award opportunity for each Participant or group of Participants, which shall be
based on the achievement of one or more specified targets of performance goals.
The targets shall be expressed in terms of an objective formula or standard
which may be based upon the Participant's Annual Base Salary or a multiple
thereof. In all cases the Committee shall have the sole and absolute discretion
to reduce the amount of any payment with respect to any Award that would
otherwise be made to any Participant or to decide that no payment shall be made.
With respect to each Award, the Committee may establish terms regarding the
circumstances in which a Participant will be entitled to payment notwithstanding
the failure to achieve the applicable performance goals or targets ( e.g. ,
where the Participant's employment terminates due to death or disability or
where a change in control of the Company occurs); provided , however , that with
respect to any Participant who is a "covered employee" within the meaning of
Section 162(m) of the Code, the Committee shall not establish any such terms
that would cause an Award payable upon the achievement of the performance
 
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goals not to satisfy the conditions of Treasury regulation Section 1.162-27(e)
or any successor regulation describing the "qualified performance-based
compensation."
 
        Payments.     At the time the Committee determines an Award opportunity
for a Participant, the Committee shall also establish the payment terms
applicable to such Award. Such terms shall include when such payments will be
made; provided , however , that the timing of such payments shall in all
instances either (A) satisfy the conditions of an exception from Section 409A of
the Code ( e.g. , the short-term deferrals exception described in Treasury
Regulation Section 1.409A-1(b)(4)), or (B) comply with Section 409A of the Code
and provided , further , that in the absence of such terms regarding the timing
of payments, such payments shall occur no later than the later of (1) the
15th day of the third month of the calendar year following the calendar year in
which the Participant's right to payment ceased being subject to a substantial
risk of forfeiture, and (2) the 15th day of the third month of the Company's
fiscal year following the Company's fiscal year in which the Participant's right
to payment ceased being subject to a substantial risk of forfeiture.
 
        Maximum Awards.     No Participant shall receive a payment under the
Plan with respect to any Performance Period having a value in excess of
$2,000,000, which maximum amount shall be proportionately adjusted with respect
to Performance Periods that are less than or greater than one year in duration.
 
General
 
        Effective Date.     The Plan shall be submitted to the stockholders of
the Company for approval at the 2012 annual meeting of stockholders and, if
approved by the affirmative vote of a majority of the shares of common stock
present in person or represented by proxy at such meeting, shall become
effective for Performance Periods beginning on and after April 1, 2012. In the
event that the Plan is not approved by the stockholders of the Company, the Plan
shall be null and void with respect to Participants who are "covered employees"
within the meaning of Section 162(m) of the Code.
 
        Amendments and Termination.     The Board may amend the Plan as it shall
deem advisable, subject to any requirement of stockholder approval required by
applicable law, rule or regulation, including Section 162(m) of the Code. The
Board may terminate the Plan at any time.
 
        Non-Transferability of Awards.     No award under the Plan shall be
transferable other than by will, the laws of descent and distribution or
pursuant to beneficiary designation procedures approved by the Company. Except
to the extent permitted by the foregoing sentence, no award may be sold,
transferred, assigned, pledged, hypothecated, encumbered or otherwise disposed
of (whether by operation of law or otherwise) or be subject to execution,
attachment or similar process. Upon any attempt to sell, transfer, assign,
pledge, hypothecate, encumber or otherwise dispose of any such award, such award
and all rights thereunder shall immediately become null and void.
 
        Tax Withholding.     The Company shall have the right to require, prior
to the payment of any amount pursuant to an award made hereunder, payment by the
Participant of any Federal, state, local or other taxes which may be required to
be withheld or paid in connection with such award.
 
        No Right of Participation or Employment.     No person shall have any
right to participate in the Plan. Neither the Plan nor any award made hereunder
shall confer upon any person any right to continued employment by the Company or
any subsidiary or affiliate of the Company or affect in any manner the right of
the Company or any subsidiary or affiliate of the Company to terminate the
employment of any person at any time without liability hereunder.
 
        Designation of Beneficiary.     If permitted by the Company, a
Participant may file with the Committee a written designation of one or more
persons as such Participant's beneficiary or beneficiaries (both primary and
contingent) in the event of the Participant's death. Each beneficiary
 
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designation shall become effective only when filed in writing with the Committee
during the Participant's lifetime on a form prescribed by the Committee. The
spouse of a married Participant domiciled in a community property jurisdiction
shall join in any designation of a beneficiary other than such spouse. The
filing with the Committee of a new beneficiary designation shall cancel all
previously filed beneficiary designations. If a Participant fails to designate a
beneficiary, or if all designated beneficiaries of a Participant predecease the
Participant, then any amount payable with respect to an award after a
Participant's death shall be payable to the Participant's executor,
administrator, legal representative or similar person.
 
        Governing Law.     The Plan and each award hereunder, and all
determinations made and actions taken pursuant thereto, to the extent not
otherwise governed by the Code or the laws of the United States, shall be
governed by the laws of the State of Delaware and construed in accordance
therewith without giving effect to principles of conflicts of laws.
 
        Other Plans.     Payments pursuant to the Plan shall not be treated as
compensation for purposes of any other compensation or benefit plan, program or
arrangement of the Company or any of its subsidiaries, unless either (a) such
other plan provides that compensation such as payments made pursuant to the Plan
are to be considered as compensation thereunder or (b) the Board or the
Committee so determines in writing. Neither the adoption of the Plan nor the
submission of the Plan to the Company's stockholders for their approval shall be
construed as limiting the power of the Board or the Committee to adopt such
other incentive arrangements as it may otherwise deem appropriate.
 
        Binding Effect.     The Plan shall be binding upon the Company and its
successors and assigns and the Participants and their beneficiaries, personal
representatives and heirs. If the Company becomes a party to any merger,
consolidation or reorganization, then the Plan shall remain in full force and
effect as an obligation of the Company or its successors in interest, unless the
Plan is amended or terminated pursuant to Section 6.2.
 
        Unfunded Arrangement.     The Plan shall at all times be entirely
unfunded and no provision shall at any time be made with respect to segregating
assets of the Company for payment of any benefit hereunder. No Participant shall
have any interest in any particular assets of the Company or any of its
affiliates by reason of the right to receive a benefit under the Plan and any
such Participant shall have only the rights of an unsecured creditor of the
Company with respect to any rights under the Plan.
 
 
 
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