EXECUTIVE COMPENSATION (CONTINUED)
incentive compensation for the preceding fiscal year (if not yet paid), plus the sum of (x) for Mr. Moore, three times and for Mr. Gordon and Ms. Kastner, one and one-half times the executives annual base salary in effect on the date of termination, and (y) a pro rata portion of the executives average incentive compensation for the three most recently
completed fiscal years. The pro rata portion is determined by multiplying the average incentive compensation by a fraction, the numerator of which is the number of days in the current fiscal year of the Company that have expired prior to the
termination date and the denominator of which is 365;
continuation of health and welfare benefits for a period of three years for Messrs. Sullivan, Rice and Moore, and for a period of 18 months for Mr. Gordon
and Ms. Kastner;
estate and financial planning services for a period of one year for Messrs. Sullivan, Rice and Moore, and for a period of 6 months for Mr. Gordon and
a lump sum payment equal to, for Messrs. Sullivan, Rice and Moore, three times and for Mr. Gordon and Ms. Kastner, one and one-half times the most recent annual premium or other cost for the executive life insurance coverage in effect on the date of termination, grossed up to compensate for the tax impact of the payment (or, if greater,
the next scheduled annual premium payment shown on the then-current schedule of coverage);
a lump sum amount equal to the cash value of, for Messrs. Sullivan, Rice and Moore, three years, and for Mr. Gordon and Ms. Kastner, 18 months of
benefits that the executive would have received had he continued to participate and received awards under the Restricted Stock Plan (as determined in accordance with the Companys past practice);
the lapse of all transfer restrictions and forfeiture provisions on restricted stock awarded under the 1997 and 2007 Restricted Stock Plans;
the lapse of transfer restrictions on any awards under the 2004 Omnibus Plan;
outplacement assistance for two years following the change in control;
a lump sum payment, or gross-up, equal to the amount of any excise tax imposed on the executive under Section 4999
of the Internal Revenue Code, or any similar state or local tax law, and any taxes, interest or penalties incurred with respect thereto;
interest on certain of the above payments if not made in a timely manner in accordance with the employment agreement or change in control agreement; and
up to an amount of $250,000 in legal fees incurred by the executive in each of the two calendar years following termination of employment in the event that,
following a change in control, he or she may be caused to institute or defend legal proceedings to enforce his or her rights under the employment agreement or change in control agreement.
The employment agreements provide that the Company will not be obligated to make the lump sum payments or provide the additional benefits described above unless the
executive signs a release and waiver of claims and refrains from revoking, rescinding or otherwise repudiating the release of claims during certain time periods. In the table above, we have assumed that the Company timely made all payments and
the executive did not incur legal fees.
Restrictive Covenants that Apply During and After Termination of Employment
Pursuant to the terms of the employment agreements, each of our named executive officers is subject to certain restrictive covenants that apply during and after
their termination of employment. Each named executive officer is subject to a covenant not to disclose our confidential information during their term of employment with us and at all times thereafter. During their employment with us and for a period
of two years thereafter our named executive officers are also subject to covenants not to (i) compete with us (or any of our subsidiaries) or (ii) solicit our employees or customers.
Payments upon a Change in Control Only
Treatment of SARs. Under the terms of the stock appreciation
rights agreements under which SARs were granted, in the event of a change in control, the executive will be entitled to immediately exercise all unvested SARs. The amounts set forth in the table for SARs reflect the difference between the
closing price of our Common Stock on May 31, 2017, the last business day of fiscal 2017, and the exercise prices for the SARs for which vesting would be accelerated and for which the closing price exceeded the SAR exercise price.
Treatment of PERS Awards. Under the terms of the Performance Earned Restricted Stock (PERS) and escrow agreements under which PERS were granted, in the event
change in control, the restrictions on unvested PERS will lapse. The amounts set forth in the table for PERS reflect the number of PERS for
which vesting would be accelerated multiplied by the closing price of our Common Stock on May 31, 2017, the last business day of fiscal 2017.
RPM International Inc. (NYSE: RPM) owns subsidiaries that are world leaders in coatings, sealants, building materials and related services. From homes to precious landmarks worldwide, their brands are trusted by consumers and professionals alike to protect, improve and beautify. Among its leading consumer brands are Rust-Oleum, DAP and Zinsser. Learn more about RPM brands >>
RPM is a compelling long-term investment.
The percent by which RPM's 10-year total return has bested the S&P 500. More reasons >>
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