RPM 2020 Proxy Statement

EXECUTIVE COMPENSATION (CONTINUED) (2) The values included in this column represent the grant date fair value of restricted stock computed in accordance with ASC 718, except no assumptions for forfeitures were included. A discussion of the assumptions used in calculating the compensation cost is set forth in Note J of the Notes to Consolidated Financial Statements of our 2020 Annual Report on Form 10-K. (3) Shares of SERP restricted stock awarded under the 2014 Omnibus Plan. These shares vest on the earliest to occur of (a) the later of either the employee’s attainment of age 55 or the fifth anniversary of the May 31st immediately preceding the date on which the shares of restricted stock were awarded, (b) the retirement of the employee on or after the attainment of age 65 or (c) a change in control with respect to the Company. (4) PERS for which the threshold and maximum number of shares and performance goals with respect to fiscal 2020 were determined in early fiscal 2020 and are disclosed herein pursuant to Commission rules. (5) PSU awards were made pursuant to the 2014 Omnibus Plan and are contingent upon the level of attainment of performance goals for the three-year period from June 1, 2019 ending May 31, 2022. The determination of whether and to what extent the PSU awards are achieved for such period will be made following the close of fiscal year 2022. The amounts set forth in columns (i) and (l) assume the maximum amount of PSU is awarded. (6) SARs granted pursuant to the 2014 Omnibus Plan. These SARs vest in four equal installments, beginning July 22, 2021. Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table Salary. Salaries paid to our named executive officers pursuant to their employment arrangements with us are set forth in the Summary Compensation Table. For fiscal 2020, salaries paid to our named executive officers accounted for the following percentages of their total compensation reported in the “Total” column of the Summary Compensation Table: Frank C. Sullivan (11%), Mr. Gordon (20%), Mr. Moore (17%), Ms. Kastner (17%), and Michael H. Sullivan (18%). For fiscal 2019, salaries paid to our named executive officers accounted for the following percentages of their total compensation reported in the “Total” column of the Summary Compensation Table: Frank C. Sullivan (12%), Mr. Gordon (20%), Mr. Moore (18%), and Ms. Kastner (18%). For fiscal 2018, salaries paid to our named executive officers accounted for the following percentages of their total compensation reported in the “Total” column of the Summary Compensation Table: Frank C. Sullivan (19%), Mr. Gordon (28%), Mr. Moore (26%), and Ms. Kastner (28%). Bonus. No bonuses were awarded to our named executive officers during fiscal 2020, fiscal 2019 or fiscal 2018, although the named executive officers did receive cash awards under our Incentive Plan, as further described under the caption “Non-Equity Incentive Plan Compensation” below. Stock Awards. The amounts in the “Stock Awards” column of the “Grants of Plan-Based Awards for Fiscal 2020” table consist of restricted stock and performance earned restricted stock grants. Each of these grants is described in further detail under the heading “Compensation Discussion and Analysis – Equity Compensation.” • SERP Restricted Stock . We granted restricted stock under our 2014 Omnibus Plan. The SERP restricted stock awards granted to our named executive officers are set forth in the table “Grants of Plan-Based Awards for Fiscal 2020.” The vesting of SERP restricted stock upon either the death or disability of the named executive officer or upon a change in control of our Company is described under the heading “Other Potential Post-Employment Compensation.” • PSU . Pursuant to our 2014 Omnibus Plan, we awarded performance stock units, or PSU, to our named executive officers. The PSU awards are contingent upon the level of attainment of performance goals for the three-year period from June 1, 2019 ending May 31, 2022. • PERS . Pursuant to our 2014 Omnibus Plan, we award performance earned restricted stock grants, or PERS, to our named executive officers. The PERS granted to our named executive officers are set forth in the table “Grants of Plan- Based Awards for Fiscal 2020.” The amounts included in the “Stock Awards” column of the Summary Compensation Table represent the grant date fair value of grants made in accordance with ASC 718. Option Awards. Pursuant to our 2014 Omnibus Plan, we awarded stock appreciation rights, or SARs, to our named executive officers. The SARs granted to our named executive officers are set forth in the table “Grants of Plan-Based Awards for Fiscal 2020.” These grants are described in further detail under the heading “Compensation Discussion and Analysis – Equity Compensation – Stock Appreciation Rights (SARs).” The amounts included in the “Option Awards” column of the Summary Compensation Table represent the grant date fair value of grants made in accordance with ASC 718. Non-Equity Incentive Plan Compensation. The non-equity incentive plan compensation set forth in the Summary Compensation Table reflects annual cash incentive compensation under our Incentive Plan. Annual cash incentive compensation is earned based upon the achievement of performance objectives as described under the heading “Compensation Discussion and Analysis – Annual Cash Incentive Compensation.” Change in Pension Value and Nonqualified Deferred Compensation Earnings. The change in the present value of each of our named executive officer’s accrued pension benefits under our Retirement Plan from May 31, 2019 to May 31, 2020 was based upon the Pri-2012 no-collar retiree generational mortality table for males and females with mortality improvements projected using scale MP2019. For calculations under our Retirement Plan in the form of a 100% joint and survivor annuity, as of May 31, 2020, the interest rate used in conversion was 7.00% based on the Retirement Plan’s definition of actuarial equivalence. The change in the present value of each of our named executive officer’s accrued pension 39