RPM 2020 Proxy Statement

EXECUTIVE COMPENSATION Compensation Discussion and Analysis Executive Summary In this section, we describe the material components of our executive compensation program for our named executive officers whose compensation is set forth in the Summary Compensation Table and other compensation tables contained in this Proxy Statement: • Frank C. Sullivan, our Chairman, President and Chief Executive Officer; • Russell L. Gordon, our Vice President and Chief Financial Officer; • Edward W. Moore, our Senior Vice President, General Counsel and Chief Compliance Officer; • Janeen B. Kastner, our Vice President – Corporate Benefits and Risk Management; and • Michael H. Sullivan, our Vice President – Operations and Chief Restructuring Officer. We also provide an overview of our executive compensation philosophy and our executive compensation program. In addition, we explain how and why the Compensation Committee arrives at specific compensation policies and decisions involving the named executive officers. Our Business RPM International Inc. owns subsidiaries that are world leaders in specialty coatings, sealants, building materials and related services. The Company operates across four reportable segments: consumer, construction products, performance coatings and specialty products. RPM has a diverse portfolio with hundreds of market-leading brands, including Rust-Oleum, DAP, Zinsser, Varathane, Day-Glo, Legend Brands, Stonhard, Carboline, Tremco and Dryvit. From homes and workplaces, to infrastructure and precious landmarks, RPM’s brands are trusted by consumers and professionals alike to help build a better world. The Company employs approximately 14,600 individuals worldwide. For more information about our business, please see “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K filed with the Commission on July 27, 2020. Fiscal 2020 Business Highlights The Company’s consolidated net sales, net income, and diluted earnings per share for the fiscal year ended May 31, 2020 were as follows: • Consolidated net sales decreased 1.0% to a $5.51 billion in fiscal 2020 from $5.56 billion in fiscal 2019; • Net income attributable to RPM International Inc. stockholders increased 14.2% to $304.4 million in fiscal 2020 from $266.6 million in fiscal 2019; and • Diluted earnings per share increased 16.4% to $2.34 in fiscal 2020 from $2.01 in fiscal 2019 (adjusted diluted earnings per share* increased 13.3% to $3.07 in fiscal 2020 from $2.71 in fiscal 2019). * See Appendix A for information about how we calculated adjusted diluted earnings per share for fiscal 2020 and fiscal 2019. The Compensation Committee considered our fiscal 2020 operating results, including our adjusted diluted earnings per share, in connection with its compensation decisions. MAP to Growth Operating Improvement Plan Remains on Track The Company remains on track to reach its targeted $290 million in annualized savings over the course of its MAP to Growth. As part of the MAP to Growth, the Company’s MS- 168 manufacturing system, which focuses on continuous improvement, continued to be implemented at the Company’s plants around the world, allowing the Company to produce better products more quickly, cost effectively and sustainably. The Company’s efforts to centralize procurement provided greater control over the Company’s supply chain, enabling the Company to obtain certain raw materials at better price points. The Company also made great strides in streamlining its administrative functions and consolidating its many information technology platforms. Additionally, the Company has closed 22 out of the 31 plants that were originally targeted for consolidation at the start of the MAP to Growth program. Fiscal 2020 Executive Compensation Highlights For fiscal 2020, the Compensation Committee: • Increased base salaries over fiscal 2019 by 2.1% for Frank C. Sullivan, 2.5% for Mr. Gordon, 2.6% for Mr. Moore, and 5.7% for Ms. Kastner; • Awarded stock appreciation rights for fiscal 2020 in the same amounts as in fiscal 2019, and Performance Earned Restricted Stock (PERS) grants at 76% of target amounts for fiscal 2020; and • Under the Incentive Plan for fiscal 2020, increased cash awards by $100,000 for Frank C. Sullivan, $0 for Messrs. Gordon and Moore, and $60,000 for Ms. Kastner. Total fiscal 2020 compensation, as set forth in the Summary Compensation Table, increased compared to total fiscal 2019 compensation for Messrs. Frank C. Sullivan, Gordon and Moore and Ms. Kastner. 25