þ | Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
o | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
Delaware | 02-0642224 | |
(State or Other Jurisdiction of | (IRS Employer Identification No.) | |
Incorporation or Organization) | ||
P.O. Box 777, 2628 Pearl Road, Medina, Ohio | 44258 | |
(Address of Principal Executive Offices) | (Zip Code) |
Title of Each Class
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Name of Each Exchange on Which Registered | |
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Common Stock, par value $0.01
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New York Stock Exchange | |
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Rights to Purchase Shares of Common Stock
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New York Stock Exchange |
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| sealants and institutional roofing systems used in building protection, maintenance and weatherproofing applications marketed under our TREMCO, REPUBLIC, VULKEM and DYMERIC brand names; | |
| basement waterproofing sealants marketed under our TUFF-N-DRI and WATCHDOG WATERPROOFING brand names, and specialized roofing maintenance and related services marketed under our WEATHERPROOFING TECHNOLOGIES brand name; | |
| joint sealing tapes, flashing tapes, cartridge sealants and adhesives, strips, foils and accessories marketed under our ILLBRUCK, FESTIX, PERENNATOR and COCO brand names; | |
| high-performance polymer flooring systems for industrial, institutional and commercial facility floor surfaces marketed under our STONHARD brand name; | |
| industrial and commercial tile systems marketed under our LOCK-TILE and ECOLOC brand names; | |
| fiberglass reinforced plastic gratings and shapes used for industrial platforms, staircases and walkways marketed under our FIBERGRATE, CHEMGRATE and CORGRATE brand names; | |
| high-performance, heavy-duty corrosion-control coatings, fireproofing products and containment linings for a wide variety of industrial infrastructure applications marketed under our CARBOLINE, NULLIFIRE, A/D FIRE, NU-CHEM and PLASITE brand names; | |
| exterior insulating finishing systems, including textured finish coats, sealers and variegated-aggregate finishes marketed under our DRYVIT brand name; | |
| a variety of products for specialized applications, including powder coatings for exterior and interior applications marketed under our TCI brand name; |
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| fluorescent colorants and pigments marketed under our DAY-GLO brand name; | |
| concrete and masonry additives and related construction chemicals marketed under our EUCO brand name; | |
| commercial carpet and floor cleaning solutions marketed under our CHEMSPEC brand name; | |
| specialty adhesives and sealants marketed under our COMPACTA and PACTAN brand names; | |
| fuel additives marketed under our VALVTECT brand name; | |
| wood treatments marketed under our KOP-COAT brand name; | |
| pleasure marine coatings marketed under our PETTIT, WOOLSEY and Z-SPAR brand names; | |
| and waterproofing and concrete repair products marketed under our VANDEX brand name. |
| a broad line of coating products to protect and decorate a wide variety of surfaces for the DIY and professional markets which are sold under several key RUST-OLEUM brand names, including STOPS RUST, AMERICAN ACCENTS, PAINTERS TOUCH, SPECIALTY, PROFESSIONAL, TREMCLAD, VARATHANE, WATCO, EPOXY SHIELD, INDUSTRIAL CHOICE, LABOR SAVER, ROAD WARRIOR, SIERRA PERFORMANCE, HARD HAT, MATHYS, COMBI COLOR, NOXYDE and BLACKFRIAR; | |
| a complete line of caulks, sealants and adhesives for home improvement, construction and the autobody aftermarket, marketed through a wide assortment of DAP and BONDO branded products, including ALEX, ALEX PLUS, ALEX FAST DRY, KWIK SEAL, KWIK SEAL PLUS, SIDEWINDER, DYNAFLEX 230, PHENOSEAL, MONO, SEAL N PEEL, WELDWOOD, BLUESTIK, ONE STIK, SPRAY N STIK, STIKAROUNDS, STRONGSTIK, EPOXYSTIK, BEATS THE NAIL, 33, BLEND STICK, PLASTIC WOOD, FAST N FINAL , DRYDEX, EASY SOLUTIONS, CRACKSHOT, PRESTO PATCH, QUICK PLUG, DAPTEX, KWIK FOAM, BONDO and DYNATRON; | |
| a broad line of specialty products targeted to solve problems for the paint contractor and the DIYer for applications that include surface preparation, mold and mildew prevention, wallpaper removal and application, and waterproofing, under our ZINSSER, B-I-N, BULLS EYE 1-2-3, COVER-STAIN, DIF, FAST PRIME, SEALCOAT, JOMAX, GARDZ, PERMA WHITE, SHIELDZ, WATERTITE, OKON, PARKS, PAPERTIGER and WALWORKS brand names; |
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| an assortment of other products, including hobby paints and cements marketed under our TESTORS brand name; | |
| wood furniture finishes and touch-up products marketed under our CCI, MOHAWK, CHEMICAL COATINGS, BEHLEN and WESTFIELD COATINGS brand names; | |
| deck and fence restoration products marketed under our WOLMAN brand name; | |
| metallic and faux finish coatings marketed under our MODERN MASTERS brand name; | |
| and shellac-based-specialty coatings for industrial and pharmaceutical uses, edible glazes and food coatings marketed under our MANTROSE-HAEUSER and NATURE SEAL brand names. |
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| the sale, export, generation, storage, handling, use and transportation of hazardous materials; | |
| the emission and discharge of hazardous materials into the soil, water and air; | |
| and the health and safety of our employees. |
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| may require us to dedicate a material portion of our cash flow from operations to make payments on our indebtedness or meet our asbestos obligations, thereby reducing the cash flow available to fund working capital, capital expenditures, acquisitions, dividend payments, stock repurchases or other general corporate requirements; | |
| could result in a downgrading of our credit rating, which would increase our borrowing costs, adversely affect our financial results, and make it more difficult for us to raise capital; | |
| may restrict our operational flexibility and reduce our ability to conduct certain transactions, since our credit facility contains certain restrictive financial and operating covenants; | |
| may limit our flexibility to adjust to changing business and market conditions, which would make us more vulnerable to a downturn in general economic conditions; | |
| and may have a material adverse effect on our short-term liquidity if large debt maturities and asbestos-related cash outlays occur in close succession. |
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| inaccurate assessments of disclosed liabilities and the potentially adverse effects of undisclosed liabilities; | |
| unforeseen difficulties in assimilating acquired companies, their products, and their culture into our existing business; | |
| unforeseen delays in realizing the benefits from acquired companies or product lines, including projected efficiencies, cost savings, revenue synergies and profit margins; | |
| unforeseen diversion of our managements time and attention from other business matters; |
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| unforeseen difficulties resulting from insufficient prior experience in any new markets we may enter; | |
| unforeseen difficulties in retaining key employees and customers of acquired businesses; | |
| and increases in our indebtedness and contingent liabilities, which could in turn restrict our ability to raise additional capital when needed or to pursue other important elements of our business strategy. |
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Approximate | ||||||||||||
Square Feet | ||||||||||||
Business/ | of | |||||||||||
Location | Segment | Floor Space | Leased or Owned | |||||||||
Pleasant Prairie,
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Rust-Oleum | 303,200 | Owned | |||||||||
Wisconsin
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(Consumer) | |||||||||||
Toronto, Ontario,
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Tremco | 207,200 | Owned | |||||||||
Canada
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(Industrial) | |||||||||||
Newark,
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Zinsser | 182,418 | Owned | |||||||||
New Jersey
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(Consumer) | |||||||||||
Cleveland,
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Euclid Chemical | 178,838 | Owned | |||||||||
Ohio
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(Industrial) |
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Approximate | ||||||||||||
Square Feet | ||||||||||||
Business/ | of | |||||||||||
Location | Segment | Floor Space | Leased or Owned | |||||||||
Cleveland, Ohio
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Tremco | 160,300 | Owned | |||||||||
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(Industrial) | |||||||||||
Bodenwoehr, | illbruck | 151,171 | Owned | |||||||||
Germany | (Industrial) | |||||||||||
Cleveland, Ohio
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Day-Glo | 147,200 | Owned | |||||||||
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(Industrial) | |||||||||||
Baltimore,
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DAP | 144,200 | Owned | |||||||||
Maryland | (Consumer) | |||||||||||
Hagerstown,
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Rust-Oleum | 143,000 | Owned | |||||||||
Maryland | (Consumer) | |||||||||||
Arkel,
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illbruck | 140,067 | Owned | |||||||||
Netherlands | (Industrial) | |||||||||||
Tipp City, Ohio
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DAP | 140,000 | Owned | |||||||||
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(Consumer) | |||||||||||
Lake Charles,
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Carboline | 114,300 | Owned | |||||||||
Louisiana
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(Industrial) | |||||||||||
Lesage, West
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Zinsser | 112,000 | Owned | |||||||||
Virginia | (Consumer) | |||||||||||
Somerset, New
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Zinsser | 110,000 | Owned | |||||||||
Jersey | (Consumer) | |||||||||||
Maple Shade,
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Stonhard | 77,500 | Owned | |||||||||
New Jersey
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(Industrial) |
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Name | Age | Position and Offices with the Company | ||||
Frank C. Sullivan
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46 | President and Chief Executive Officer | ||||
Ronald A. Rice
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44 | Executive Vice President and Chief Operating Officer | ||||
P. Kelly Tompkins
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50 | Executive Vice President and Chief Administrative Officer | ||||
Paul G. Hoogenboom
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47 | Senior Vice President - Manufacturing and Operations and Chief Information Officer | ||||
Stephen J. Knoop
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42 | Senior Vice President - Corporate Development | ||||
Robert L. Matejka
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64 | Vice President, Chief Financial Officer and Controller |
* | Included pursuant to Instruction 3 to Item 401(b) of Regulation S-K. |
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Item 5. | Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. |
Maximum | ||||||||||||||||
Total | Total Number of | Number of Shares | ||||||||||||||
Number of | Shares Purchased as | that May Yet be | ||||||||||||||
Shares | Part of Publicly | Purchased Under | ||||||||||||||
Purchased | Average Price | Announced Plans or | the Plans or | |||||||||||||
Period | (1) | Paid per Share | Programs | Programs | ||||||||||||
March 1, 2007 through March 31, 2007
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April 1, 2007 through April 30, 2007
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| | | | ||||||||||||
May 1, 2007 through May 31, 2007
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4,021 | $ | 22.70 | | | |||||||||||
TOTAL
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4,021 | $ | 22.70 | | | |||||||||||
(1) | The number of shares reported as repurchased are attributable to shares that were withheld by us from employees in satisfaction of tax obligations of those employees related to the vesting of restricted stock which was granted under the 1997 Restricted Stock Plan and the 2004 Omnibus Equity and Incentive Plan. |
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2007 1 | 2006 1 | 2005 1 | 2004 | 2003 1 | ||||||||||||||||
(Amounts in thousands, except per share and percentage data) | ||||||||||||||||||||
Net sales
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$ | 3,338,764 | $ | 3,008,338 | $ | 2,555,735 | $ | 2,307,553 | $ | 2,053,482 | ||||||||||
Income (loss) before income taxes
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307,535 | (122,475 | ) | 163,728 | 217,616 | 47,853 | ||||||||||||||
Net income (loss)
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208,289 | (76,205 | ) | 105,032 | 141,886 | 35,327 | ||||||||||||||
Return on sales %
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6.2 | % | (2.5 | )% | 4.1 | % | 6.1 | % | 1.7 | % | ||||||||||
Basic earnings (loss) per share
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$ | 1.76 | $ | (0.65 | ) | $ | 0.90 | $ | 1.23 | $ | 0.31 | |||||||||
Diluted earnings (loss) per share
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1.64 | (0.65 | ) | 0.86 | 1.16 | 0.30 | ||||||||||||||
Stockholders equity
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1,086,870 | 925,941 | 1,037,739 | 970,402 | 871,752 | |||||||||||||||
Stockholders equity per share
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9.20 | 7.93 | 8.88 | 8.38 | 7.56 | |||||||||||||||
Return on stockholders equity %
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20.7 | % | (7.8 | )% | 10.5 | % | 15.4 | % | 4.1 | % | ||||||||||
Average shares outstanding
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118,179 | 116,837 | 116,899 | 115,777 | 115,294 | |||||||||||||||
Cash dividends paid
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$ | 82,106 | $ | 74,427 | $ | 68,933 | $ | 63,651 | $ | 59,139 | ||||||||||
Cash dividends per share
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0.685 | 0.630 | 0.590 | 0.550 | 0.515 | |||||||||||||||
Retained earnings
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475,676 | 349,493 | 500,125 | 464,026 | 385,791 | |||||||||||||||
Working capital
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705,509 | 655,718 | 693,656 | 516,542 | 499,838 | |||||||||||||||
Total assets
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3,333,149 | 2,996,064 | 2,647,475 | 2,345,202 | 2,238,199 | |||||||||||||||
Long-term debt
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886,416 | 870,415 | 837,948 | 718,929 | 724,846 | |||||||||||||||
Depreciation and amortization
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81,607 | 74,299 | 65,992 | 63,277 | 58,674 |
Note: | Acquisitions made by the Company during the periods presented may impact comparability from year to year (See Note A to the Consolidated Financial Statements). Certain reclassifications have been made to prior year amounts to conform to the current year presentation. | |
1 | Reflects the impact of the asbestos-related insurance settlement of $15.0 million ($9.7 million after-tax) in 2007, and asbestos charges of $380.0 million ($244.3 million after-tax) in fiscal 2006, $78.0 million ($49.5 million after-tax) in fiscal 2005 and $140.0 million ($87.5 million after-tax) in fiscal 2003 (See Note I to the Consolidated Financial Statements). |
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Table of Contents
24
Table of Contents
Schedule | Page or Exhibit No. | |
Report of Independent Registered Public Accounting Firm
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S-1 | |
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Schedule II Valuation and Qualifying
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S-2 | |
Accounts and Reserves
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Consent of Independent Registered Public Accounting Firm
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Exhibit 23.1 |
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E-1
E-2
E-3
E-4
E-5
E-6
E-7
E-8
E-9
S-1
S-2
S-3
RPM INTERNATIONAL INC.
Date: July 30, 2007
By:
/s/ Frank C. Sullivan
Frank C. Sullivan
President and
Chief Executive Officer
President and Chief Executive Officer and a Director
(Principal Executive Officer)
Vice President, Chief Financial Officer and Controller
(Principal Financial and Accounting Officer)
Chairman and a Director
Director
Director
Director
Table of Contents
Director
Director
Director
Director
Director
Director
Director
Table of Contents
Exhibit No.
Description
Amended and Restated Certificate of Incorporation of the Company, which
is incorporated herein by reference to Exhibit 4.1 to the Companys
Registration Statement on Form S-8 (File No. 333-101501), as filed with
the Commission on November 27, 2002.
Amended and Restated By-Laws of the Company, which are incorporated
herein by reference to Exhibit 4.2 to the Companys Registration
Statement on Form S-8 (File No. 333-101501), as filed with the Commission
on November 27, 2002.
Specimen Certificate of Common Stock, par value $0.01 per share, of the
Company, which is incorporated herein by reference to Exhibit 4.3 to the
Companys Registration Statement on Form S-8 (File No. 333-101501), as
filed with the Commission on November 27, 2002.
Rights Agreement by and between the Company (as successor to RPM, Inc.)
and Harris Trust and Savings Bank dated as of April 28, 1999, which is
incorporated herein by reference to Exhibit 4.1 to the Companys
Registration Statement on Form 8-A as filed with the Commission on May
11, 1999 (File No. 001-14187).
Amendment to Rights Agreement dated as of December 18, 2000 by and among
the Company (as successor to RPM, Inc.), Computershare Investor Services
(formerly Harris Trust and Savings Bank) and National City Bank, which is
incorporated herein by reference to Exhibit 4.4.1 to the Companys Annual
Report on Form 10-K for the fiscal year ended May 31, 2001 (File No.
001-14187).
Second Amendment to Rights Agreement, dated as of October 15, 2002, among
RPM, Inc., National City Bank (as successor rights agent to Computershare
Investor Services, formerly Harris Trust and Savings Bank) and the
Company, which is incorporated herein by reference to Exhibit 4.4.2 to
the Companys Registration Statement on Form S-8 (File No. 333-101501),
as filed with the Commission on November 27, 2002.
Indenture, dated as of June 1, 1995, between RPM, Inc. and The First
National Bank of Chicago, as trustee, which is incorporated herein by
reference to Exhibit 4.5 to the Companys Registration Statement on Form
S-4 as filed with the Commission on August 3, 1995 (File No. 033-61541).
First Supplemental Indenture, dated as of March 5, 1998 to the Indenture
dated as of June 1, 1995, between RPM, Inc. and The First National Bank
of Chicago, as trustee, with respect to the Liquid Asset Notes with
Coupon Exchange (LANCEs(SM)) Due 2008, which is incorporated herein by
reference to Exhibit 4.6 to the Companys Annual Report on Form 10-K for
the fiscal year ended May 31, 1998 (File No. 001-14187).
Table of Contents
Exhibit No.
Description
Specimen Note Certificate of Liquid Asset Notes with Coupon Exchange
(LANCEs(SM)) Due 2008, which is incorporated herein by reference to
Exhibit 4.3 to the Companys Annual Report on Form 10-K for the fiscal
year ended May 31, 1998 (File No. 001-14187).
Second Supplemental Indenture, dated as of August 26, 2002, by and among
the Company, RPM, Inc. and Bank One, N.A. (f/k/a The First National Bank
of Chicago) as Trustee, relating to the Indenture, dated as of June 1,
1995, by and between the Company and the Trustee, which is incorporated
herein by reference to Exhibit 10.6 to the Companys Quarterly Report on
Form 10-Q for the quarter ended August 31, 2002 (File No. 001-14187).
Indenture, dated as of May 13, 2003 between the Company, as issuer, and
The Bank of New York, as trustee, with respect to the Senior Convertible
Notes Due 2033, which is incorporated herein by reference to Exhibit 4.9
to the Companys Annual Report on Form 10-K for the fiscal year ended May
31, 2003 (File No. 001-14187).
Specimen Note Certificate for Senior Convertible Notes Due 2033, which is
incorporated herein by reference to Exhibit 4.4 to the Companys Annual
Report on Form 10-K for the fiscal year ended May 31, 2003 (File No.
001-14187).
Indenture, dated as of December 9, 2003 between the Company, as issuer,
and The Bank of New York, as trustee, with respect to the 6.25% Senior
Notes Due 2013, which is incorporated herein by reference to Exhibit 4.2
to the Companys Registration Statement on Form S-4 (File No.
333-114259), as filed with the Commission on April 7, 2004.
Specimen Note Certificate of 6.25% Senior Notes Due 2013, which is
incorporated herein by reference to Exhibit 4.5 to the Companys Annual
Report on Form 10-K for the fiscal year ended May 31, 2004 (File No.
001-14187).
Indenture dated as of September 30, 2004 between the Company, as
issuer, and The Bank of New York, as trustee, with respect to the 4.45%
Senior Notes Due 2009, which is incorporated herein by reference to
Exhibit 4.1 to the Companys Current Report on Form 8-K, as filed with
the Commission on September 30, 2004 (File No. 001-14187).
Form of 4.45% Senior Notes Due 2009, which is incorporated herein by
reference to Exhibit 4.3 to the Companys Current Report on Form 8-K, as
filed with the Commission on September 30, 2004 (File No. 001-14187).
Indenture, dated as of October 24, 2005, among RPM United Kingdom G.P.,
by its general partners, RPM Canada and RPM Canada Investment Company,
the Company, as guarantor, and The Bank of New York Trust Company, N.A.,
as trustee, which is incorporated herein by reference to Exhibit 4.1 to
the Companys Current Report on Form 8-K, as filed with the Commission on
October 25, 2005 (File No. 001-14187).
Form of 6.70% Senior Note Due 2015, which is incorporated herein by
reference to Exhibit 4.2 to the Companys Current Report on Form 8-K, as
filed with the Commission on October 25, 2005 (File No. 001-14187).
Table of Contents
Exhibit No.
Description
Form of Guarantee, which is incorporated herein by reference to Exhibit
4.3 to the Companys Current Report on Form 8-K, as filed with the
Commission on October 25, 2005 (File No. 001-14187).
Credit Agreement among RPM International Inc., the Borrowers party
thereto, the Lenders party thereto and National City Bank, as
Administrative Agent, dated as of November 19, 2004, which is
incorporated herein by reference to Exhibit 10.1 to the Companys Current
Report on Form 8-K, as filed with the Commission on November 24, 2004
(File No. 001-14187).
Amendment No. 1 to Credit Agreement among RPM International Inc., the
Borrowers party thereto, the Lenders party thereto and National City
Bank, as Administrative Agent, dated as of July 18, 2006, which is
incorporated herein by reference to Exhibit 10.1.1 to the Companys
Annual Report on Form 10-K for the fiscal year ended May 31, 2006 (File
No. 001-14187).
Credit Agreement among RPM International Inc., the Borrowers party
thereto, the Lenders party thereto and National City Bank, as
Administrative Agent, dated as of December 29, 2006, which is
incorporated herein by reference to Exhibit 10.1 to the Companys Current
Report on Form 8-K, as filed with the Commission on January 4, 2007 (File
No. 001-14187).
Receivables Sale Agreement among certain subsidiaries of the Company, the
Company and RPM Funding Corporation, dated June 6, 2002, which is
incorporated herein by reference to Exhibit 10.1 to the Companys
Quarterly Report on Form 10-Q for the quarter ended August 31, 2002 (File
No. 001-14187).
Amendment No. 2 to Receivables Sale Agreement among certain subsidiaries
of the Company, the Company and RPM Funding Corporation, dated January
28, 2003, which is incorporated herein by reference to Exhibit 10.17.1 to
the Companys Annual Report on Form 10-K for the fiscal year ended May
31, 2004 (File No. 001-14187).
Amendment No. 3 to Receivables Sale Agreement among certain subsidiaries
of the Company, the Company and RPM Funding Corporation, dated April 30,
2004, which is incorporated herein by reference to Exhibit 10.17.2 to the
Companys Annual Report on Form 10-K for the fiscal year ended May 31,
2004 (File No. 001-14187).
Amendment No. 4 to Receivables Sale Agreement among certain subsidiaries
of the Company, the Company and RPM Funding Corporation, dated March 8
,
2005, which is incorporated herein by reference to Exhibit 10.15.3 to the
Companys Annual Report on Form 10-K for the fiscal year ended May 31,
2005 (File No. 001-14187).
Omnibus Amendment No. 1 to the Receivables Sale Agreement and the
Receivables Purchase Agreement, by and among RPM, Inc., the Company,
certain subsidiaries of the Company, RPM Funding Corporation and Bank
One, dated as of October 15, 2002, which is incorporated herein by
reference to Exhibit 10.16 to the Companys Quarterly Report on Form 10-Q
for the quarter ended November 30, 2002 (File No. 001-14187).
Table of Contents
Exhibit No.
Description
Amended and Restated Receivables Purchase Agreement, among RPM Funding
Corporation, RPM International Inc., as Servicer, Wachovia Bank, National
Association, as Administrative Agent and Co-Agent, and The Bank of Tokyo
- Mitsubishi UFJ, Ltd., New York Branch as Co-Agent, dated as of May 10,
2006, which is incorporated herein by reference to Exhibit 10.3 to the
Companys Annual Report on Form 10-K for the fiscal year ended May 31,
2006 (File No. 001-14187).
Amended and Restated Performance Undertaking executed by RPM
International Inc., in favor of RPM Funding Corporation, dated May 10,
2006, which is incorporated herein by reference to Exhibit 10.3.1 to the
Companys Annual Report on Form 10-K for the fiscal year ended May 31,
2006 (File No. 001-14187).
Amendment No. 1 to Amended and Restated Receivables Purchase Agreement
among RPM Funding Corporation, RPM International Inc., as Servicer,
Wachovia Bank, National Association, as Administrative Agent and
Co-Agent, and The Bank of Tokyo Mitsubishi UFJ, Ltd., New York Branch
as Co-Agent, entered into July 18, 2006 effective as of May 31, 2006,
which is incorporated herein by reference to Exhibit 10.3.2 to the
Companys Annual Report on Form 10-K for the fiscal year ended May 31,
2006 (File No. 001-14187).
Commercial Paper Dealer Agreement between the Company, as Issuer, and
U.S. Bancorp Piper Jaffray Inc., as Dealer, dated as of April 21, 2003,
which is incorporated herein by reference to Exhibit 10.21 to the
Companys Annual Report on Form 10-K for the fiscal year ended May 31,
2003 (File No. 001-14187).
Issuing and Paying Agent Agreement between U.S. Bank Trust National
Association and the Company, dated as of April 21, 2003, which is
incorporated herein by reference to Exhibit 10.22 to the Companys Annual
Report on Form 10-K for the fiscal year ended May 31, 2003 (File No.
001-14187).
Succession and Post-Retirement Consulting Letter Agreement, dated April
12, 2002, by and between RPM, Inc. and Thomas C. Sullivan, which is
incorporated herein by reference to Exhibit 10.1 to the Companys Annual
Report on Form 10-K for the year ended May 31, 2002 (File No. 001-14187).
Letter of Amendment to Employment Agreement and Consulting Letter
Agreement, dated as of October 14, 2002, by and between RPM, Inc., the
Company and Thomas C. Sullivan, which is incorporated herein by reference
to Exhibit 10.1 to the Companys Quarterly Report on Form 10-Q for the
quarter ended November 30, 2002 (File No. 001-14187).
Extension to Post-Retirement Consulting Agreement, which is
incorporated herein by reference to Exhibit 10.1.3 to the Companys
Current Report on Form 8-K, as filed with the Commission on June 29, 2005
(File No. 001-14187).
Extension to Post-Retirement Consulting Agreement, by and between the
Company and Thomas C. Sullivan, dated as of June 1, 2007. (x)
Table of Contents
Exhibit No.
Description
Amended and Restated Employment Agreement, entered into August 16, 2006,
effective as of June 1, 2006, by and between the Company and Frank C.
Sullivan, President and Chief Executive Officer, which is incorporated
herein by reference to Exhibit 10.1 to the Companys Current Report on
Form 8-K, as filed with the Commission on August 22, 2006 (File No.
001-14187).
Form of Amended and Restated Employment Agreement, entered into August
16, 2006, effective as of June 1, 2006, by and between the Company and
each of P. Kelly Tompkins, Senior Vice President, General Counsel and
Secretary; Ronald A. Rice, Senior Vice President Administration and
Assistant Secretary; Paul G. Hoogenboom, Vice President Operations and
Chief Information Officer; and Robert L. Matejka Vice President, Chief
Financial Officer and Controller, which is incorporated herein by
reference to Exhibit 10.2 to the Companys Current Report on Form 8-K, as
filed with the Commission on August 22, 2006 (File No. 001-14187).
Form of Amended and Restated Employment Agreement, dated as of October 5,
2006, by and between the Company and each of Ronald A. Rice, Executive
Vice President, Chief Operating Officer and Assistant Secretary; P. Kelly
Tompkins, Executive Vice President, Chief Administrative Officer and
Secretary; and Paul G. Hoogenboom, Senior Vice President Manufacturing
and Operations and Chief Information Officer, which is incorporated
herein by reference to Exhibit 10.3 to the Companys Current Report on
Form 8-K, as filed with the Commission on October 12, 2006 (File No.
001-14187).
Form of Indemnification Agreement entered into by and between the Company
and each of its Directors and Executive Officers, which is incorporated
herein by reference to Exhibit 10.14 to the Companys Quarterly Report on
Form 10-Q for the quarter ended November 30, 2002 (File No. 001-14187).
RPM International Inc. 1989 Stock Option Plan, as amended, and form of
Stock Option Agreements to be used in connection therewith, which is
incorporated herein by reference to Exhibit 10.4 to the Companys Annual
Report on Form 10-K for the fiscal year ended May 31, 2001 (File No.
001-14187).
Amendment No. 3 to RPM International Inc. 1989 Stock Option Plan, as
amended, which is incorporated herein by reference to Exhibit 4.5.1 to
the Companys Registration Statement on Form S-8 (File No. 033-32794), as
filed with the Commission on November 27, 2002.
RPM International Inc. 1996 Stock Option Plan, which is incorporated
herein by reference to Exhibit 4.5 to the Companys Registration
Statement on Form S-8 (File No. 333-60104), as filed with the Commission
on November 27, 2002.
Amendment No. 1 to RPM International Inc. 1996 Stock Option Plan, which
is incorporated herein by reference to Exhibit 10.7.1 to the Companys
Annual Report on Form 10-K for the fiscal year ended May 31, 1998 (File
No. 001-14187).
Table of Contents
Exhibit No.
Description
Amendment to RPM International Inc. 1996 Stock Option Plan, which is
incorporated herein by reference to Exhibit 4.3.1 to the Companys
Registration Statement on Form S-8 as filed with the Commission on May 3,
2001 (File No. 001-14187).
Amendment No. 3 to RPM International Inc. 1996 Stock Option Plan, which
is incorporated herein by reference to Exhibit 4.5.3 to the Companys
Registration Statement on Form S-8, as filed with the Commission on
November 27, 2002 (File No. 333-60104).
Form of Stock Option Agreement to be used in connection with the RPM
International Inc. 1996 Stock Option Plan, as amended, which is
incorporated herein by reference to Exhibit 10.6.1 to the Companys
Quarterly Report on Form 10-Q for the quarter ended November 30, 2002
(File No. 001-14187).
RPM International Inc. Benefit Restoration Plan, which is incorporated
herein by reference to Exhibit 10.7 to the Companys Annual Report on
Form 10-K for the fiscal year ended May 31, 2001 (File No. 001-14187).
Amendment No. 1 to the RPM International Inc. Benefit Restoration Plan,
which is incorporated herein by reference to Exhibit 10.4 to the
Companys Quarterly Report on Form 10-Q for the quarter ended February
28, 2003 (File No. 001-14187).
Amendment No. 2 to RPM International Inc. Benefit Restoration Plan, which
is incorporated herein by reference to Exhibit 10.9 to the Companys
Quarterly Report on Form 10-Q for the quarter ended November 30, 2002
(File No. 001-14187).
RPM International Inc. Deferred Compensation Plan, which is incorporated
herein by reference to Exhibit 10.8.1 to the Companys Annual Report on
Form 10-K for the year ended May 31, 2002 (File No. 001-14187).
Master Trust Agreement for RPM International Inc. Deferred Compensation
Plan, which is incorporated herein by reference to Exhibit 10.8.1 to the
Companys Annual Report on Form 10-K for the year ended May 31, 2002
(File No. 001-14187).
Amendment No. 1 to RPM International Inc. Deferred Compensation Plan,
which is incorporated herein by reference to Exhibit 4.5.1 to the
Companys Registration Statement on Form S-8 (File No. 333-101512), as
filed with the Commission on November 27, 2002.
Amendment No. 2 to the RPM International Inc. Deferred Compensation Plan.
(x)
Amendment No. 3 to RPM International Inc. Deferred Compensation Plan,
which is incorporated herein by reference to Exhibit 10.10.3 to the
Companys Annual Report on Form 10-K for the fiscal year ended May 31,
2004 (File No. 001-14187).
Amendment No. 4 to the RPM International Inc. Deferred Compensation Plan.
(x)
Amendment No. 5 to the RPM International Inc. Deferred Compensation Plan.
(x)
Amendment No. 6 to the RPM International Inc. Deferred Compensation Plan.
(x)
Table of Contents
Exhibit No.
Description
RPM International Inc. Incentive Compensation Plan, which is incorporated
herein by reference to Exhibit 10.10 to the Companys Annual Report on
Form 10-K for the fiscal year ended May 31, 2001 (File No. 001-14187).
Amendment No. 1 to RPM International Inc. Incentive Compensation Plan,
which is incorporated herein by reference to Exhibit 10.11 to the
Companys Quarterly Report on Form 10-Q for the quarter ended November
30, 2002 (File No. 001-14187).
Amendment No. 2 to RPM International Inc. Incentive Compensation Plan,
which is incorporated herein by reference to Exhibit 10.3 to the
Companys Quarterly Report on Form 10-Q for the quarter ended November
30, 2004 (File No. 001-14187).
1997 RPM International Inc. Restricted Stock Plan, and Form of Acceptance
and Escrow Agreement to be used in connection therewith, which is
incorporated herein by reference to Exhibit 10.12 to the Companys
Quarterly Report on Form 10-Q for the quarter ended November 30, 2002
(File No. 001-14187).
First Amendment to the RPM, Inc. 1997 Restricted Stock Plan, effective as
of October 1, 1998, which is incorporated herein by reference to Exhibit
10.10.1 to the Companys Annual Report on Form 10-K for the year ended
May 31, 2002 (File No. 001-14187).
Second Amendment to the RPM International Inc. 1997 Restricted Stock
Plan, which is incorporated herein by reference to Exhibit 10.10.2 to the
Companys Annual Report on Form 10-K for the year ended May 31, 2002
(File No. 001-14187).
Third Amendment to the 1997 RPM International Inc. Restricted Stock Plan,
which is incorporated herein by reference to Exhibit 10.12.1 to the
Companys Quarterly Report on Form 10-Q for the quarter ended November
30, 2002 (File No. 001-14187).
Fourth Amendment to the 1997 RPM International Inc. Restricted Stock
Plan, which is incorporated herein by reference to Exhibit 10.5 to the
Companys Quarterly Report on Form 10-Q for the quarter ended February
28, 2003 (File No. 001-14187).
Fifth Amendment to the 1997 RPM International Inc. Restricted Stock Plan,
which is incorporated herein by reference to Exhibit 10.12.5 to the
Companys Annual Report on Form 10-K for the fiscal year ended May 31,
2004 (File No. 001-14187).
Sixth Amendment to the RPM International Inc. 1997 Restricted Stock Plan.
(x)
RPM International Inc. 2002 Performance Accelerated Restricted Stock
Plan, which is incorporated herein by reference to Exhibit 10.2 to the
Companys Quarterly Report on Form 10-Q for the quarter ended February
28, 2003 (File No. 001-14187).
Amendment No. 1 to the RPM International Inc. 2002 Performance
Accelerated Restricted Stock Plan, which is incorporated herein by
reference to Exhibit 10.3 to the Companys Quarterly Report on Form 10-Q
for the quarter ended February 28, 2003 (File No. 001-14187).
Table of Contents
Exhibit No.
Description
Amendment No. 2 to the RPM International Inc. 2002 Performance
Accelerated Restricted Stock Plan, which is incorporated herein by
reference to Exhibit 10.13.2 to the Companys Annual Report on Form 10-K
for the fiscal year ended May 31, 2004 (File No. 001-14187).
Amendment No. 3 to the RPM International Inc. 2002 Performance
Accelerated Restricted Stock Plan. (x)
RPM International Inc. 2003 Restricted Stock Plan for Directors, which is
incorporated herein by reference to Exhibit 10.1 to the Companys
Quarterly Report on Form 10-Q for the quarter ended November 30, 2003
(File No. 001-14187).
Amendment No. 1 to the RPM International Inc. 2003 Restricted Stock Plan
for Directors. (x)
RPM International Inc. 2004 Omnibus Equity and Incentive Plan, which is
incorporated herein by reference to Exhibit 4.3 to the Companys
Registration Statement on Form S-8 (File No. 333-120067), as filed with
the Commission on October 29, 2004.
Form of Performance-Earned Restricted Stock (PERS) and Escrow Agreement,
which is incorporated herein by reference to Exhibit 10.26 to the
Companys Annual Report on Form 10-K for the fiscal year ended May 31,
2005 (File No. 001-14187).
Form of Stock Appreciation Rights Agreement, which is incorporated herein
by reference to Exhibit 10.1 to the Companys Quarterly Report on Form
10-Q for the quarter ended August 31, 2005 (File No. 001-14187).
Amendment No. 1 to the RPM International Inc. 2004 Omnibus Equity and
Incentive Plan. (x)
RPM International Inc. 2007 Restricted Stock Plan, which is incorporated
herein by reference to Exhibit 10.1 to the Companys Current Report on
Form 8-K, as filed with the Commission on October 12, 2006 (File No.
001-14187).
RPM International Inc. 2007 Incentive Compensation Plan, which is
incorporated herein by reference to Exhibit 10.2 to the Companys Current
Report on Form 8-K, as filed with the Commission on October 12, 2006
(File No. 001-14187).
Share Purchase Agreement between illbruck GmbH, Sabina Illbruck, Michael
Illbruck and Tremco Germany GmbH, RPOW UK Ltd., RPM International Inc.
dated as of July 25, 2005, which is incorporated herein by reference to
Exhibit 10.2 to the Companys Quarterly Report on Form 10-Q for the
quarter ended August 31, 2005 (File No. 001-14187).
Portions of RPM International Inc.s 2007 Annual Report to Stockholders.
(x)
Subsidiaries of the Company. (x)
Consent of Independent Registered Public Accounting Firm. (x)
Consent of Independent Public Accounting Firm. (x)
Table of Contents
Exhibit No.
Description
Consent of Crawford & Winiarski, which is incorporated herein by
reference to Exhibit 99.1 to the Companys Current Report on Form 8-K, as
filed with the Commission on April 24, 2007 (File No. 001-14187).
Rule 13a-14(a) Certification of the Companys Chief Executive Officer. (x)
Rule 13a-14(a) Certification of the Companys Chief Financial Officer. (x)
Section 1350 Certification of the Companys Chief Executive Officer. (xx)
Section 1350 Certification of the Companys Chief Financial Officer. (xx)
(x)
Filed herewith.
(xx)
Furnished herewith.
*
Management contract or compensatory plan or arrangement.
Table of Contents
on Financial Statement Schedule
RPM International Inc. and Subsidiaries
Medina, Ohio
Table of Contents
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
Table of Contents
(1)
Uncollectible accounts written off, net of recoveries
(2)
Primarily claims paid during the year, net of insurance contributions
(3)
Transfers between current and noncurrent
1. | No Employment Relationship As you are aware, you have not been an employee of the Company since the date of your retirement on January 1, 2003. Accordingly, you are not entitled to participate in the Companys Benefit Plans, except as required by law, the terms of the Benefit Plans, or as provided for during the Extension Period (see below). |
2. | Consulting Services During the twelve (12) month Extension Period, the Company will pay you a gross amount of $25,000 per month for your services as a consultant. Specifically, you agree to continue to utilize your industry experience and business relationships to assist in corporate development related activities including identifying acquisition opportunities, as may be requested from time-to-time by the Company. You also acknowledge that from time-to-time you will be required to travel internationally in connection with the performance of your consulting services. In addition, during the Extension Period, you will also be entitled to the following benefits at the Companys sole cost and expense: |
a. | Use of reasonable off-site office space; | ||
b. | Use of a part-time administrative assistant; | ||
c. | Continued use of your current company car; | ||
d. | Continued coverage under the Companys Health Insurance Plan for you and your eligible dependent; | ||
e. | Continued payment of the standard monthly membership dues during the Extension Period for one country club, and the membership dues for The Union Club; and | ||
f. | Continuation of financial planning services, as currently provided. |
cc:
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Compensation Committee | |
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Frank C. Sullivan | |
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P. Kelly Tompkins | |
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/s/ Thomas C. Sullivan
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6/1/07 | |||
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Thomas C. Sullivan
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Date | |||
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/s/ Janet L. Corrigan
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6/1/07 | |||
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(Witness)
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Date |
1
1.23 | Deferral Account shall mean (i) that portion of a Participants Rollover Amount which is represented by the Participants aggregate deferral contributions described in Section 6.1 of the Predecessor Plan and in the Deferred Compensation Plan for Directors, as well as any appreciation (or depreciation) specifically attributable to such deferral contributions, plus (ii) the sum of all of a Participants Annual Deferral Amounts, plus (iii) amounts credited in accordance with all the applicable crediting and debiting provisions of this Plan that relate to the Participants Deferral Account, less (iv) all distributions made to the Participant or his or her Beneficiary pursuant to this Plan that relate to his or her Deferral Account. |
2
1.41 | Restricted Stock shall mean rights to receive unvested shares of restricted stock selected by the Committee in its sole discretion and awarded to the Participant under the RPM International Inc. 1997 Restricted Stock Plan, the 2002 RPM International Inc. Performance Accelerated Restricted Stock Plan or any other similar stock incentive plan sponsored by the Company. |
1.42. | Restricted Stock Account shall mean the aggregate value, measured on any given date, of (i) the number of shares of Restricted Stock deferred by a Participant as a result of all Annual Restricted Stock Amounts, plus (ii) the number of shares of Restricted Stock cancelled under the RPM International Inc. 1997 Restricted Stock Plan, the 2002 RPM International Inc. Performance Accelerated Restricted Stock Plan or any other similar stock incentive plan sponsored by the Company where a corresponding number of shares is to be credited to the Restricted Stock Account pursuant to the terms of the applicable stock incentive plan, plus (iii) the number of additional shares credited as a result of deemed reinvestment of dividends in accordance with all the applicable crediting provisions of the RPM, Inc. Stock Unit Fund I that relate to the Participants Restricted Stock Account, less (iv) the number of shares of Restricted Stock previously distributed to the Participant or his or her Beneficiary pursuant |
3
to this Plan. This portion of the Participants Account Balance shall only be distributable in actual shares of Stock. |
2.1 | Selection by Committee . Participation in the Plan shall be limited to (i) a select group of management and highly compensated Employees and Directors of the Employer, as determined by the Committee in its sole discretion and/or (ii) any individual who was in a select group of management or highly compensated Employees and/or Directors of the Employer and who accumulated an account balance under the Predecessor Plan or the Deferred Compensation Plan for Directors. From that group, the Committee shall select, in its sole discretion, Employees and Directors to participate in the Plan. |
(c) | Restricted Stock Deferral . Notwithstanding paragraphs (a) and (b), for an election to defer Restricted Stock to be valid: (i) a separate irrevocable Election Form must be completed and signed by the Participant, with respect to such Restricted Stock; and (ii) such Election Form must be timely delivered to and accepted by the Committee in accordance with the following: (i) for the first Plan Year, a Participants Election Form with |
4
respect to such Restricted Stock must be delivered to and accepted by the Committee in accordance with the deadlines established by the Committee; and (ii) for each succeeding Plan Year, a Participants Election Form with respect to Restricted Stock must be timely delivered to and accepted by the Committee at least six (6) months prior to the date such Restricted Stock vests under the terms of the RPM International Inc. 1997 Restricted Stock Plan, the 2002 RPM International Inc. Performance Accelerated Restricted Stock Plan or any other similar stock incentive plan sponsored by the Company. |
3.5 | Rollover Amount . With respect to Participants who participated in the Predecessor Plan or the Deferred Compensation Plan for Directors, an amount equal to their account as set forth in the Predecessor Plan and the Deferred Compensation Plan for Directors, valued as of the Effective Date of this Plan, shall be the Rollover Amount. The Rollover Amount shall be comprised of (i) elective deferrals accumulated pursuant to Section 6.1 of the Predecessor Plan and pursuant to the Deferred Compensation Plan for Directors, (ii) a Participants Merger Account accumulated pursuant to Section 2.15A of the Predecessor Plan, and (iii) any dividends declared on Restricted Stock granted to a Participant and automatically deferred under the Predecessor Plan. The portion of a Participants Rollover Amount that is attributable to elective deferrals (i) |
5
shall be credited to the Participants Deferral Account on the Effective Date of this Plan, and (ii) shall be subject to the terms and conditions of this Plan. The portion of a Participants Rollover Amount that is attributable to a Participants Merger Account (i) shall be credited to the Participants Merger Account on the Effective Date of this Plan and (ii) shall be subject to the terms and conditions of this Plan. The portion of a Participants Rollover Amount that is attributable to dividends declared on Restricted Stock granted to a Participant and automatically deferred under the Predecessor Plan (i) shall be credited to a Participants Stock Dividend Account on the Effective Date of this Plan and (ii) shall be subject to the terms and conditions of this Plan. Any Participant with a Rollover Amount shall have no right to demand distribution of such amounts other than as specifically provided for herein; provided, however, that any in-service distribution elections made by the Participant under the Predecessor Plan shall apply to the Rollover Amount under this Plan. |
3.6. | Annual Stock Dividend Amount . For each Plan Year in which a dividend is declared and paid on Stock, an amount shall be credited as provided by this Section 3.6. |
(a) | An Employer shall automatically credit a Participants Stock Dividend Account with any cash dividends, stock dividends or |
6
other non-cash dividends that are payable on a Participants shares of Restricted Stock which have not been deferred or cancelled under any plan and that are to be credited for the Participants benefit under this Plan pursuant to the terms of the plan under which the Restricted Stock is granted. The amount so credited to a Participant pursuant to this Section 3.6(a) shall (i) be for that Participant the Annual Stock Dividend Amount, (ii) automatically be deemed to be invested in the Measurement Fund(s) selected by or for the Participant in accordance with Section 3.11(b), and (iii) be credited to the Participants Stock Dividend Account on a date or dates to be determined by the Committee, in its sole discretion. | |||
(b) | An Employer shall automatically credit a Participants Restricted Stock Account with any cash dividends, stock dividends or other non-cash dividends that would have been payable on a Participants shares of Restricted Stock which have been deferred or cancelled and credited to this Plan. The amount so credited to a Participant pursuant to this Section 3.6(b) shall (i) automatically be deemed to be invested in the RPM International Inc. Stock Unit Fund I, and (ii) be credited to the Participants Restricted Stock Account on a date or dates to be determined by the Committee, in its sole discretion. | ||
(c) | The amount credited to the Participants Stock Dividend Account or Restricted Stock Account under this Section 3.6 for a particular |
7
cash dividend, stock dividend or other non-cash dividend shall be equal to the fair market value of the dividend on the date it is payable. For purposes of any dividend payable in Stock or in other securities traded on a national securities exchange, fair market value shall mean the closing price on the date the dividend is paid. |
(a) | For each Plan Year, an Employer may be required to credit amounts to a Participants Company Contribution Account in accordance with the RPM International Inc. 1997 Restricted Stock Plan, employment agreements, or other plans and agreements providing for contributions to the Company Contribution Account. Such amounts shall be credited on the date or dates prescribed by such plans and agreements. |
3.9 | Annual Restricted Stock Amount . Subject to Section 3.3(c) and any terms and conditions imposed by the Committee, Participants may elect to defer, under the Plan, Restricted Stock, which amount shall be for that Participant the Annual Restricted Stock Amount for that Plan Year. The portion of any Restricted Stock deferred shall, at the time all restrictions |
8
with respect to the Restricted Stock would otherwise lapse under the terms of the RPM International Inc. 1997 Restricted Stock Plan, the 2002 RPM International Inc. Performance Accelerated Restricted Stock Plan or any other similar stock incentive plan sponsored by the Company, but for the election to defer, be reflected on the books of the Company as an unfunded, unsecured promise to deliver to the Participant a specific number of actual shares of Stock in the future. |
(c) | A Participant shall be vested in his or her Company Contribution Account and Restricted Stock Account in accordance with the vesting schedule(s) set forth in his or her Plan Agreement, employment agreement, or any other agreement entered into between the Participant and his or her Employer. However, amounts credited to the Company Contribution Account and shares credited to the Restricted Stock Account as a result of cancellation or surrender of shares of Restricted Stock granted under the RPM International Inc. 1997 Restricted Stock Plan or any other similar stock incentive plan sponsored by the Company shall be fully vested when the restrictions with respect to the stock cancelled or surrendered would have otherwise lapsed. If not addressed in such agreements or plan, a Participant shall vest in his or her Company Contribution Account and |
9
Restricted Stock Account in accordance with the schedule declared by the Committee in its sole discretion. |
(i) | Subject to the restrictions found in Section 3.11(c), above, a Participant may allocate or re-allocate any portion of his or her Account Balance and/or Merger Account balance to the RPM, Inc. Stock Unit Fund II. In all events, new contributions to the Participants Stock Dividend Account shall automatically be deemed to be invested in the Measurement Fund(s) selected by or for the Participant in accordance with Section 3.11(b). Participants may re-allocate any portion of their Account Balance and/or Merger Account balance from the RPM, Inc. Stock Unit Fund II to any other Measurement Fund, at any time. |
5.5 | Delayed Withdrawal . A Participant may petition the Committee to withdraw all or a portion of his or her vested Account Balance and vested Merger Account balance excluding the portion of the Account Balance attributable to the Restricted Stock Account. The Participant shall make this election by giving written notice of the election to the Committee on a form determined from time to time by the Committee. The Participant |
10
must specify the amount to be withdrawn and the future date on which the amount is to be paid. The requested future date of payment must be at least thirteen (13) months following the date of the written request. If the request is approved by the Committee, payment shall be made as soon as administratively possible after the first business day following the date specified by the Participant in his or her request. If prior to payment, however, an event occurs that triggers a benefit under Article 7, 8, 9, or 10 and distribution pursuant to the applicable Article occurs prior to distribution under this Section 5.5, the amount or portion of the Account Balance requested by the Participant as a delayed withdrawal shall be paid in accordance with the other applicable Article and not under this Section 5.5. |
(a) | Administrator. For purposes of this Plan, the Committee shall be the Administrator at all times prior to the occurrence of a Change in Control. Upon and after the occurrence of a Change in Control, the Administrator shall be an independent third party selected by the individual who, immediately prior to such event, was the Companys Chief Executive Officer or, if not so identified, the Companys highest ranking officer (the Ex-CEO). In the event the Chief Executive Officer or highest ranking officer is not able to perform the duties and |
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12
RPM INTERNATIONAL INC. | ||||||
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By: |
/s/ Ronald A. Rice
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Its: |
Sr. Vice President
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13
1.1 | Account Balance shall mean, with respect to a Participant, a credit on the records of the Employer equal to the sum of (i) the Deferral Account balance, (ii) the Company Contribution Account balance, (iii) the Company Restoration Matching Account balance, (iv) the Restricted Stock Account balance, (v) the Stock Dividend Account balance, (vi) the Performance Share Account balance, (vii) the Stock Appreciation Rights Account balance, (viii) the Option Account balance and (ix) the Dividend Equivalent Account balance. The Account Balance shall be a bookkeeping entry only and shall be utilized solely as a device for the measurement and determination of the amounts to be paid to a Participant, or his or her designated Beneficiary, pursuant to this Plan. The Account Balance shall not include a Participants Merger Account. |
1.6A | Annual Dividend Equivalent Amount shall mean, with respect to a Participant for any one Plan Year, the amount of Dividend Equivalents deferred in accordance with Section 3.9. In the event of a Participants Retirement, Disability (if deferrals cease in accordance with Section 9.1), death or Termination of Employment prior to the end of a Plan Year, such years Annual Dividend Equivalent Amount shall be the actual amount deferred prior to such event. |
1.6B | Annual Option Amount shall mean, with respect to a Participant for any one Plan Year, the value of the shares of Stock distributable in accordance with an Option deferred in accordance with Section 3.9, calculated using the closing price of Stock at the end of the business day closest to the date such Options would otherwise be exercised, but for the election to defer. In the event of a Participants Retirement, Disability (if deferrals cease in accordance with Section 9.1), death or a Termination of Employment prior to the end of a Plan Year, such years Annual Option Amount shall be the actual amount deferred prior to such event. |
2
1.6C | Annual Performance Share Amount shall mean, with respect to a Participant for any one Plan Year, the amount of Performance Shares deferred in accordance with Section 3.9, calculated using the closing price of Stock at the end of the business day closest to the date such Performance Shares would otherwise vest if the Performance Shares or Performance Units are payable in shares of Stock, or the date such Performance Shares or Performance Units would otherwise be distributed if they are payable in cash, but for the election to defer. In the event of a Participants Retirement, Disability (if deferrals cease in accordance with Section 9.1), death or a Termination of Employment prior to the end of a Plan Year, such years Annual Performance Share Amount shall be the actual amount deferred prior to such event. |
1.6D | Annual Stock Appreciation Rights Amount shall mean, with respect to a Participant for any one Plan Year, the amount of Stock Appreciation Rights deferred in accordance with Section 3.9, calculated using the closing price of Stock at the end of the business day closest to the date such Stock Appreciation Rights would otherwise vest if the Stock Appreciation Rights are payable in shares of Stock, or the date such Stock Appreciation Rights would otherwise be distributed if the Stock Appreciation Rights are payable in cash, but for the election to defer. In the event of a Participants Retirement, Disability (if deferrals cease in accordance with Section 9.1), death or a Termination of Employment prior to the end of a Plan Year, such years Annual Stock Appreciation Rights Amount shall be the actual amount deferred prior to such event. |
1.28A | Dividend Equivalent shall mean rights to receive an amount of money equal to the dividends paid from time to time on a specified number of shares of Stock under the RPM International Inc. 2004 Omnibus Equity and Incentive Plan or any other similar stock incentive plan sponsored by the Company. |
1.28B | Dividend Equivalent Account shall mean (i) the sum of all of a Participants Annual Dividend Equivalent Amounts, plus (ii) amounts credited in accordance with all the applicable crediting and debiting provisions of this Plan that relate to the Participants Dividend Equivalent Account, less (iii) all distributions made to |
3
the Participant or his or her Beneficiary pursuant to this Plan that relate to the Participants Dividend Equivalent Account. |
1.35B | Option shall mean an option to purchase shares of Stock granted under the RPM International Inc. 2004 Omnibus Equity and Incentive Plan or any other similar stock incentive plan sponsored by the Company and, where the context requires, Stock distributable in accordance with such an option. |
1.35C | Option Account shall mean (i) the sum of all of a Participants Annual Option Amounts, plus (ii) amounts credited in accordance with all the applicable crediting and debiting provisions of this Plan that relate to the Participants Option Account, less (iii) all distributions made to the Participant or his or her Beneficiary pursuant to this Plan that relate to the Participants Option Account. |
1.36A | Performance Share shall mean a right to receive a specified number of shares of Stock, and/or an amount of money determined by reference to the fair market value of a specified number of shares of Stock, at a future time or times if a specified performance goal is attained granted under the RPM International Inc. 2004 Omnibus Equity and Incentive Plan or any other similar stock incentive plan sponsored by the Company. Except as otherwise provided, the term Performance Share shall be deemed to include Performance Units under the RPM International Inc. 2004 Omnibus Equity and Incentive Plan or any other similar stock incentive plan sponsored by the Company. |
1.36B | Performance Share Account shall mean (i) the sum of all of a Participants Annual Performance Share Amounts plus (ii) amounts credited in accordance with all the applicable crediting and debiting provisions of this Plan that relate to the Participants Performance Share Account, less (iii) all distributions made to the Participant or his or her Beneficiary pursuant to this Plan that relate to the Participants Performance Share Account. |
4
1.48A | Stock Appreciation Rights shall mean rights to receive an amount of money, or a number shares of Stock that have a fair market value on the date of exercise of such Stock Appreciation Rights, or a combination of money and shares valued at fair market value on such date, equal to the amount by which the fair market value of a share of Stock on the date of such exercise exceeds the exercise price of the Stock Appreciation Rights, multiplied by the number of Stock Appreciation Rights exercised. |
1.48B | Stock Appreciation Rights Account shall mean (i) the sum of all of a Participants Annual Stock Appreciation Rights Amounts plus (ii) amounts credited in accordance with all the applicable crediting and debiting provisions of this Plan that relate to the Participants Stock Appreciation Rights Account, less (iii) all distributions made to the Participant or his or her Beneficiary pursuant to this Plan that relate to the Participants Stock Appreciation Rights Account. |
1.41 | Restricted Stock shall mean rights to receive unvested shares of restricted stock selected by the Committee in its sole discretion and awarded to the Participant under the RPM International Inc. 2004 Omnibus Equity and Incentive Plan, the 2002 RPM International Inc. Performance Accelerated Restricted Stock Plan, the RPM International Inc. 1997 Restricted Stock Plan or any other similar stock incentive plan sponsored by the Company. The term Restricted Stock shall be deemed to include Restricted Share Units under the RPM International Inc. 2004 Omnibus Equity and Incentive Plan or any other similar stock incentive plan sponsored by the Company. |
1.42. | Restricted Stock Account shall mean the aggregate value, measured on any given date, of (i) the number of shares of Restricted Stock deferred by a Participant as a result of all Annual Restricted Stock Amounts, plus (ii) |
5
the number of shares of Restricted Stock cancelled under the RPM International Inc. 2004 Omnibus Equity and Incentive Plan, the 2002 RPM International Inc. Performance Accelerated Restricted Stock Plan, the RPM International Inc. 1997 Restricted Stock Plan or any other similar stock incentive plan sponsored by the Company where a corresponding number of shares is to be credited to the Restricted Stock Account pursuant to the terms of the applicable stock incentive plan, plus (iii) the number of additional shares credited as a result of deemed reinvestment of dividends in accordance with all the applicable crediting provisions of the RPM, Inc. Stock Unit Fund I that relate to the Participants Restricted Stock Account, less (iv) the number of shares of Restricted Stock previously distributed to the Participant or his or her Beneficiary pursuant to this Plan. Except as may otherwise be provided in Article 15, this portion of the Participants Account Balance shall only be distributable in actual shares of Stock. |
(b) | Annual Equity and Incentive Grants . For each equity and/or incentive grant, a Participant may elect to defer as follows: |
Deferral | Minimum Percentage | |
Restricted Stock | 0% | |
Dividend Equivalents | 0% | |
Options and/or Stock distributable in accordance with
an Option |
0% | |
Performance Shares | 0% | |
Stock Appreciation Rights | 0% |
If no election is made with respect to any category, the amount deferred for such category shall be zero. |
(c) | Annual Equity and Incentive Interest Deferrals . Notwithstanding paragraphs (a) and (b), for an election to defer Restricted Stock, Dividend Equivalents, Options, Performance Shares or Stock Appreciation Rights (each an Equity or Incentive Interest)to be valid: (i) a separate irrevocable Election Form must be completed and signed by the Participant, with respect to such Equity or Incentive Interest; and (ii) such |
6
Election Form must be timely delivered to and accepted by the Committee in accordance with the following: (i) for the first Plan Year, a Participants Election Form with respect to such Equity or Incentive Interest must be delivered to and accepted by the Committee in accordance with the deadlines established by the Committee; and (ii) for each succeeding Plan Year, a Participants Election Form with respect to such Equity or Incentive Interest must be timely delivered to and accepted by the Committee on a date on which they are determined by the Committee to be Contingent Interests under the RPM International Inc. 2004 Omnibus Equity and Incentive Plan or, with respect to Restricted Stock under the 2002 RPM International Inc. Performance Accelerated Restricted Stock Plan, the RPM International Inc. 1997 Restricted Stock Plan or any other similar stock incentive plan sponsored by the Company, at least six (6) months prior to the date such Restricted Stock vests under the terms of such plans. |
(c) | An Employer shall automatically credit a Participants Performance Share Account with any cash dividends, stock dividends or other non-cash dividends that would have been payable on a Participants Performance Shares which have been deferred or cancelled and credited to this Plan. The amount so credited to a Participant pursuant to this Section 3.6(c) shall (i) to the extent attributable to Performance Shares or Performance Units payable in shares of Stock, automatically be deemed to be invested in the RPM International Inc. Stock Unit Fund I, and (ii) be credited to the Participants Performance Share Account on a date or dates to be determined by the Committee, in its sole discretion. | ||
(d) | The amount credited to the Participants Stock Dividend Account, Restricted Stock Account or Performance Share Account under this Section 3.6 for a particular cash dividend, stock dividend or other non-cash dividend shall be equal to the fair market value of the dividend on the date it is payable. For purposes of any dividend payable in Stock or in other securities traded on a national securities exchange, fair market value shall mean the closing price on the date the dividend is paid. |
7
3.9 | Annual Equity and Incentive Amounts . Subject to Section 3.3(c) and any terms and conditions imposed by the Committee, Participants may elect to defer, under the Plan: |
(a) | Restricted Stock, which shall be for that Participant the Annual Restricted Stock Amount for that Plan Year; | ||
(b) | Dividend Equivalents, which shall be for that Participant the Annual Dividend Equivalent Amount for that Plan Year; | ||
(c) | Options, which shall be for that Participant the Annual Option Amount for that Plan Year; | ||
(d) | Performance Shares, which shall be for that Participant the Annual Performance Share Amount for that Plan Year; and | ||
(e) | Stock Appreciation Rights, which shall be for that Participant the Annual Stock Appreciation Right Amount for that Plan Year. |
The portion of any of the foregoing deferred interests shall, at the time such interests would have vested, or restrictions on such interests would have lapsed, under the terms of the RPM International Inc. 2004 Omnibus Equity and Incentive Plan, the 2002 RPM International Inc. Performance Accelerated Restricted Stock Plan, the RPM International Inc. 1997 Restricted Stock Plan or any other similar stock incentive plan sponsored by the Company, as applicable, but for the election to defer, be reflected on the books of the Company as an unfunded, unsecured promise to deliver to the Participant a specific number of actual shares of Stock or cash, as the case may be, in the future. |
(c) | A Participant shall be vested in his or her Company Contribution Account and Restricted Stock Account in accordance with the vesting schedule(s) set forth in his or her Plan Agreement, employment agreement, or any other agreement entered into between the Participant and his or her Employer. However, amounts credited to the Company Contribution Account and interests credited to the Restricted Stock Account, Dividend Equivalent Account, Option Account, Performance Share Account and Stock Appreciation Account as a result of cancellation or surrender of interests granted under the RPM International Inc. 2004 Omnibus Equity and Incentive Plan, the 2002 RPM International Inc. Performance Accelerated Restricted Stock Plan, the RPM International Inc. 1997 Restricted Stock Plan or any other similar stock incentive plan sponsored |
8
by the Company shall be fully vested when they would have become fully vested, or when restrictions on such interests would have lapsed, but for the election to defer. If not addressed in such agreements or plan, a Participant shall vest in his or her Company Contribution Account and Restricted Stock Account in accordance with the schedule declared by the Committee in its sole discretion. |
(c) | RPM, Inc. Stock Unit Fund I . |
(i) | Participants Restricted Stock Account, any portion of their Performance Share Account attributable to Performance Shares or Performance Units payable in shares of Stock and any portion of their Option Account attributable to shares of Stock will be automatically allocated to the RPM, Inc. Stock Unit Fund I Measurement Fund. Participants may not select any other Measurement Fund to be used to determine the amounts to be credited or debited to these accounts or portions of accounts. Furthermore, no other portion of the Participants Account Balance can be either initially allocated or re-allocated to the RPM, Inc. Stock Unit Fund I. Amounts allocated to the RPM, Inc. Stock Unit Fund I shall only be distributable in actual shares of Stock. | ||
(ii) | Any stock dividends, cash dividends or other non-cash dividends that would have been payable on the Stock credited to a Participants Restricted Stock Account, Performance Share Account or Option Account shall be credited to the respective accounts in the form of additional shares of Stock and shall automatically and irrevocably be deemed to be re-invested in the RPM, Inc. Stock Unit Fund I until such amounts are distributed to the Participant. The number of shares credited to the Participant for a particular stock dividend shall be equal to (a) the number of shares of Stock credited to the Participants account as of the payment date for such dividend in respect of each share of Stock, multiplied by (b) the number of additional shares of Stock actually paid as a dividend in respect of each share of Stock. The number of shares credited to the Participant for a particular cash dividend or other non-cash dividend shall be equal to (a) the number of shares of Stock credited to the Participants account as of the payment date for such dividend in respect of each share of Stock, multiplied by (b) the fair market value of the dividend, divided by (c) the fair market value of the Stock on the payment date for such dividend. | ||
(iii) | The number of shares of Stock credited to the Participants Restricted Stock Account, Performance Share Account and Option Account may be adjusted by the Committee, in its sole discretion, to prevent dilution or enlargement of a Participants rights in the event of any reorganization, |
9
reclassification, stock split, or other unusual corporate transaction or event which affects the value of the Stock, provided that any such adjustment shall be made taking into account any crediting of shares of Stock to the Participant under Section 3.11(c)(ii) above in connection with such transaction or event. | |||
(iv) | For purposes of this Section 3.11(c), fair market value shall mean for any day the average of the high and low sales price or, in the event that no such sale takes place on such day, the average of the reported closing bid and asked prices, in either case as reported on the principal national securities exchange on which the Stock is listed or admitted to trading. |
5.3 | Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies . If the Participant experiences an Unforeseeable Financial Emergency, the Participant may petition the Committee (i) to suspend any deferrals required to be made by such Participant or (ii) to suspend any deferrals required to be made by such Participant and receive a partial or full payout from the Plan. The payout shall not exceed the lesser of the Participants vested Account Balance and vested Merger Account balance, excluding the portion of the Account Balance attributable to the Restricted Stock Account, Performance Share Account, Option Account, Dividend Equivalent Account and Stock Appreciation Right Account, calculated as if such Participant were receiving a Termination Benefit, or the amount reasonably needed to satisfy the Unforeseeable Financial Emergency. A Participant may not receive a payout from the Plan to the extent that the Unforeseeable Financial Emergency is or may be relieved (i) through reimbursement or compensation by insurance or otherwise, (ii) by liquidation of the Participants assets, to the extent the liquidation of such assets would not itself cause severe financial hardship or (iii) by suspension of deferrals under this Plan. If the Committee, in its sole discretion, approves a Participants petition for suspension, the Participants deferrals under this Plan shall be suspended as of the date of such approval. If the Committee, in its sole discretion, approves a Participants petition for suspension and payout, the Participants deferrals under this Plan shall be suspended as of the date of such approval and the Participant shall receive a payout from the Plan within sixty (60) days of the date of such approval. |
10
5.4 | Withdrawal Election . A Participant may elect, at any time, to withdraw all or a portion of his or her vested Account Balance, excluding the portion of the Account Balance attributable to the Restricted Stock Account, Performance Share Account, Option Account, Dividend Equivalent Account and Stock Appreciation Right Account. For purposes of this Section 5.4, the value of a Participants vested Account Balance shall be calculated as of the close of business on or around the date on which receipt of the Participants election is acknowledged by the Committee, as determined by the Committee in its sole discretion, less a withdrawal penalty equal to 10% of the amount withdrawn (the net amount shall be referred to as the Withdrawal Amount). This election can be made at any time, before or after Retirement or Disability, and whether or not the Participant is in the process of being paid pursuant to an installment payment schedule. The Participant shall make this election by giving the Committee advance written notice of the election in a form determined from time to time by the Committee. The Participant shall be paid the Withdrawal Amount within sixty (60) days of his or her election. Once the Withdrawal Amount is paid, the Participants participation in the Plan shall be suspended for the remainder of the Plan Year in which the withdrawal is elected and for one (1) full Plan Year thereafter. |
9.1 | Disability Waiver . |
(a) | Waiver of Deferral . A Participant who is determined to be suffering from a Disability shall be (i) excused from fulfilling that portion of the Annual Deferral Amount commitment that would otherwise have been withheld from a Participants Base Annual Salary, Annual Bonus, Special Incentive Plan Amounts and/or Director Fees for the Plan Year during which the Participant first suffers a Disability, (ii) excused from fulfilling any existing unvested Restricted Stock commitments, and (iii) excused from fulfilling any existing unvested Performance Share commitments to the extent provided in the RPM International 2004 Omnibus Equity and Incentive Plan or other relevant stock incentive plan sponsored by the Company. During the period of Disability, the Participant shall not be allowed to make any additional deferral elections, but will continue to be considered a Participant for all other purposes of this Plan. | ||
(b) | Deferral Following Disability . If a Participant returns to employment, or service as a Director, with an Employer after a Disability ceases, the Participant may elect to defer an Annual Deferral Amount, Annual Restricted Stock Amount, Annual Dividend Equivalent Amount, Annual Option Amount, Annual Performance Share Amount and Annual Stock |
11
Appreciation Right Amount for the Plan Year following his or her return to employment or service and for every Plan Year thereafter while a Participant in the Plan; provided such deferral elections are otherwise allowed and an Election Form is delivered to and accepted by the Committee for each such election in accordance with Section 3.3 above. |
15.1 | Mandatory Sale of Shares of Stock . Subject to the terms, conditions and restrictions specified under this Plan, the Committee shall, prior to making a payout in Stock from a Participants Account Balance and Merger Account (whether a lump sum, installment or other payout), sell or cause to be sold the fewest number of shares of Stock held in such accounts necessary to generate sufficient proceeds of such sale to equal (or exceed by not more than the actual sale price of a single share of Stock) the Participants projected tax liability determined by multiplying (A) the aggregate maximum marginal federal and applicable state and local income tax rates on the date of the distribution; by (B) the total number of shares of Stock to be distributed. The Committee shall withhold the proceeds of such sale for purposes of satisfying the Participants federal, state and local income taxes resulting from the payout of Stock. The Participant shall provide the Committee with such stock powers and additional information or documents as may be necessary for the Committee to discharge its obligations under this Section. | ||
15.2 | Payments to Satisfy Tax Liability . The Committee shall deliver the proceeds of the sale of shares of Stock pursuant to Section 15.1 to the Internal Revenue Service and/or other taxing authority in satisfaction of the Participants tax liability arising from the payout of Stock from such Participants Restricted Stock Account, Performance Share Account and Option Account. |
12
RPM INTERNATIONAL INC. | ||||||
|
||||||
|
By:
Its: |
/s/ Janeen Kastner
|
||||
|
& Administration |
13
1
(d) | Notwithstanding paragraphs (a), (b) and (c) of this Section, and any other provision of the Plan that may provide, or may be interpreted to provide, to the contrary, a Participant may make an irrevocable deferral election as provided in this paragraph (d) with respect to amounts deferred under this Plan that are subject to Code Section 409A and that relate all or in part to services performed on or before December 31, 2005. Such irrevocable deferral election must be made on an Election Form that is completed, signed and submitted to the Committee by the earlier of (i) the date that such amounts have been paid or become payable, or (ii) March 15, 2005. The amount deferred pursuant to such election together with other amounts deferred for the Plan Year must satisfy the minimum deferral amounts of Section 3.1. | ||
(e) | Notwithstanding paragraphs (a), (b) (c) and (d), and any other provision of the Plan that may provide, or may be interpreted to provide, to the contrary, with regard to amounts subject to Code Section 409A, a Participant may elect to terminate all or a level of his or her participation in the Plan or elect to cancel all or a portion of his or her deferral election provided such election is provided to the Committee on or before December 31, 2005. The amounts subject to the termination or cancellation election shall be paid to the Participant in, and included in the income of the Participant for, 2005 or, if later, on the date the Participant earns and is vested in such amounts. |
3.13. | Change In Distribution Elections Before December 31, 2006 For Code Section 409A Amounts . A Participants vested Account Balance shall be paid as provided by the Plan and, where permitted under the Plan, as elected by the Participant. On or before December 31, 2006, a Participant may change his or her payment elections (including any election regarding the form and timing of a payment) for vested amounts and benefits of the Plan that are subject to Code Section 409A and that are deferred prior to the election. A Participant may not in calendar year 2006, however, change any payment election with respect to any vested amounts or benefits subject to Code Section 409A that he or she would otherwise receive in calendar year 2006, or cause any such amount or benefit to be paid in calendar year 2006 that would otherwise not be received in calendar year 2006. |
2
RPM INTERNATIONAL INC. | ||||||
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||||||
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By: |
/s/ Ronald A. Rice
|
||||
|
||||||
|
Its: |
Senior Vice President
|
3
15.1 | Mandatory Sale of Shares of Stock . Subject to the terms, conditions and restrictions specified under this Plan, the Committee shall, prior to making a payout in Stock from a Participants Account Balance and Merger Account (whether a lump sum, installment or other payout), sell or cause to be sold the fewest number of shares of Stock held in such accounts necessary to generate |
sufficient proceeds of such sale to equal (or exceed by not more than the actual sale price of a single share of Stock) the Participants minimum tax liability determined by multiplying (A) the aggregate minimum marginal federal and applicable state and local income tax rates on the date of the distribution; by (B) the total number of shares of Stock to be distributed. The Committee shall withhold the proceeds of such sale for purposes of satisfying the Participants federal, state and local income taxes resulting from the payout of Stock. The Participant shall provide the Committee with such stock powers and additional information or documents as may be necessary for the Committee to discharge its obligations under this Section. |
RPM INTERNATIONAL INC. | ||||||
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||||||
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By: | /s/ Ronald A. Rice | ||||
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||||||
|
Ronald A. Rice | |||||
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||||||
|
Its: | Senior Vice President Administration | ||||
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2
2
RPM INTERNATIONAL INC. | ||||||
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||||||
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By: | /s/ Ronald A. Rice | ||||
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||||||
|
Ronald A. Rice | |||||
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||||||
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Its: | Senior Vice President Administration | ||||
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3
2
3
RPM INTERNATIONAL INC. | ||||||
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||||||
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By: | /s/ Ronald A. Rice | ||||
|
||||||
|
Ronald A. Rice | |||||
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||||||
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Its: | Senior Vice President Administration | ||||
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4
2
RPM INTERNATIONAL INC. | ||||||
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||||||
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By: | /s/ Ronald A. Rice | ||||
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||||||
|
Ronald A. Rice | |||||
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||||||
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Its: | Senior Vice President Administration | ||||
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3
RPM INTERNATIONAL INC. | ||||||
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||||||
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By: | /s/ Ronald A. Rice | ||||
|
Ronald A. Rice
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|||||
|
Its: | Senior Vice President Administration | ||||
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2
Annual | ||
Report | Financial Section Contents |
22 |
Managements Discussion and Analysis
|
|||
34 |
Financial Statements
|
|||
38 |
Notes to Financial Statements
|
|||
64 |
Quarterly Stock Price and Dividend Information
|
|||
65 |
Managements Report on Internal Control
|
|||
66 |
Auditors Reports
|
|||
69 |
Stockholder Information
|
|||
70 |
Subsidiaries
|
| significant under-performance relative to historical or projected future operating results; | |
| significant changes in the manner of our use of the acquired assets; | |
| significant changes in the strategy for our overall business; | |
| and significant negative industry or economic trends. |
Year Ended May 31 | 2007 | 2006 | 2005 | |||||||||
Net Sales
|
||||||||||||
Industrial Segment
|
$ | 2,100,386 | $ | 1,811,590 | $ | 1,441,548 | ||||||
Consumer Segment
|
1,238,378 | 1,196,748 | 1,114,187 | |||||||||
Consolidated
|
$ | 3,338,764 | $ | 3,008,338 | $ | 2,555,735 | ||||||
Income (Loss) Before Income Taxes
(a)
|
||||||||||||
Industrial Segment
|
||||||||||||
Income Before Income Taxes
(a)
|
$ | 233,120 | $ | 201,230 | $ | 168,578 | ||||||
Interest (Expense), Net
|
(1,937 | ) | (1,711 | ) | 532 | |||||||
EBIT
(b)
|
$ | 235,057 | $ | 202,941 | $ | 168,046 | ||||||
Consumer Segment
|
||||||||||||
Income Before Income Taxes
(a)
|
$ | 151,496 | $ | 159,147 | $ | 147,601 | ||||||
Interest (Expense), Net
|
(2,895 | ) | (142 | ) | 415 | |||||||
EBIT
(b)
|
$ | 154,391 | $ | 159,289 | $ | 147,186 | ||||||
Corporate/Other
|
||||||||||||
(Expense) Before Income Taxes
(a)
|
$ | (77,081 | ) | $ | (482,852 | ) (c) | $ | (152,451 | ) (c) | |||
Interest (Expense), Net
|
(42,201 | ) | (39,490 | ) | (36,325 | ) | ||||||
EBIT
(b)
|
$ | (34,880 | ) | $ | (443,362 | ) | $ | (116,126 | ) | |||
Consolidated
|
||||||||||||
Income (Loss) Before Income Taxes
(a)
|
$ | 307,535 | $ | (122,475 | ) | $ | 163,728 | |||||
Interest (Expense), Net
|
(47,033 | ) | (41,343 | ) | (35,378 | ) | ||||||
EBIT
(b)
|
$ | 354,568 | $ | (81,132 | ) | $ | 199,106 | |||||
(a) | The presentation includes a reconciliation of Income (Loss) Before Income Taxes, a measure defined by Generally Accepted Accounting Principles (GAAP) in the United States, to EBIT. | |
(b) | EBIT is defined as earnings (loss) before interest and taxes. We evaluate the profit performance of our segments based on income (loss) before income taxes, but also look to EBIT as a performance evaluation measure because interest expense is essentially related to corporate acquisitions, as opposed to segment operations. We believe EBIT is useful to investors for this purpose as well, using EBIT as a metric in their investment decisions. EBIT should not be considered an alternative to, or more meaningful than, operating income as determined in accordance with GAAP, since EBIT omits the impact of interest and taxes in determining operating performance, which represent items necessary to our continued operations, given our level of indebtedness and ongoing tax obligations. Nonetheless, EBIT is a key measure expected by and useful to our fixed income investors, rating agencies and the banking community all of whom believe, and we concur, that this measure is critical to the capital markets analysis of our segments core operating performance. We also evaluate EBIT because it is clear that movements in EBIT impact our ability to attract financing. Our underwriters and bankers consistently require inclusion of this measure in offering memoranda in conjunction with any debt underwriting or bank financing. EBIT may not be indicative of our historical operating results, nor is it meant to be predictive of potential future results. | |
(c) | The asbestos charges, totaling $380.0 million in fiscal 2006 and $78.0 million in fiscal 2005, reflected in Corporate/Other, relate to our Bondex International, Inc. subsidiary (see Note I to the Consolidated Financial Statements). |
Payments Due In | ||||||||||||||||||||
Total Contractual | ||||||||||||||||||||
(In thousands) | Payment Stream | 2008 | 2009-10 | 2011-12 | After 2012 | |||||||||||||||
Long-term debt obligations
|
$ | 988,057 | $ | 101,641 | $ | 260,469 | $ | 273,620 | $ | 352,327 | ||||||||||
Operating lease obligations
|
101,925 | 28,149 | 35,093 | 15,560 | 23,123 | |||||||||||||||
Other long-term liabilities
1
|
365,370 | 61,769 | 77,776 | 76,636 | 149,189 | |||||||||||||||
Total
|
$ | 1,455,352 | $ | 191,559 | $ | 373,338 | $ | 365,816 | $ | 524,639 | ||||||||||
1 | These amounts represent our estimated cash contributions to be made in the periods indicated for our pension and postretirement plans, assuming no actuarial gains or losses, assumption changes or plan changes occur in any period. The projection results assume $10.3 million will be contributed to the U.S. plan in fiscal 2008; all other plans and years assume the required minimum contribution will be contributed. Also included are expected interest payments on long-term debt. |
May 31 | 2007 | 2006 | ||||||
Assets
|
||||||||
Current Assets
|
||||||||
Cash and short-term investments
|
$ | 159,016 | $ | 108,616 | ||||
Trade accounts receivable (less allowances of $19,167 in 2007
and $20,252 in 2006)
|
744,259 | 650,945 | ||||||
Inventories
|
437,759 | 399,014 | ||||||
Deferred income taxes
|
39,276 | 48,885 | ||||||
Prepaid expenses and other current assets
|
189,939 | 163,768 | ||||||
Total current assets
|
1,570,249 | 1,371,228 | ||||||
Property, Plant and Equipment, at Cost
|
||||||||
Land
|
28,149 | 28,849 | ||||||
Buildings and leasehold improvements
|
276,852 | 267,899 | ||||||
Machinery and equipment
|
658,199 | 590,528 | ||||||
|
963,200 | 887,276 | ||||||
Less allowance for depreciation and amortization
|
489,904 | 442,584 | ||||||
Property, plant and equipment, net
|
473,296 | 444,692 | ||||||
Other Assets
|
||||||||
Goodwill
|
830,177 | 750,635 | ||||||
Other intangible assets, net of amortization
|
351,435 | 321,942 | ||||||
Deferred income taxes, non-current
|
18,694 | 34,084 | ||||||
Other
|
89,298 | 73,483 | ||||||
Total other assets
|
1,289,604 | 1,180,144 | ||||||
Total Assets
|
$ | 3,333,149 | $ | 2,996,064 | ||||
Liabilities and Stockholders Equity
|
||||||||
Current Liabilities
|
||||||||
Accounts payable
|
$ | 385,003 | $ | 333,684 | ||||
Current portion of long-term debt
|
101,641 | 6,141 | ||||||
Accrued compensation and benefits
|
132,555 | 136,384 | ||||||
Accrued loss reserves
|
73,178 | 66,678 | ||||||
Asbestos-related liabilities
|
53,000 | 58,925 | ||||||
Other accrued liabilities
|
119,363 | 113,698 | ||||||
Total current liabilities
|
864,740 | 715,510 | ||||||
Long-Term Liabilities
|
||||||||
Long-term debt, less current maturities
|
886,416 | 870,415 | ||||||
Asbestos-related liabilities
|
301,268 | 362,360 | ||||||
Other long-term liabilities
|
175,958 | 108,002 | ||||||
Deferred income taxes
|
17,897 | 13,836 | ||||||
Total long-term liabilities
|
1,381,539 | 1,354,613 | ||||||
Total liabilities
|
2,246,279 | 2,070,123 | ||||||
Stockholders Equity
|
||||||||
Preferred stock, par value $0.01; authorized 50,000 shares;
none issued
|
||||||||
Common stock, par value $0.01; authorized 300,000 shares;
issued and outstanding 120,906 as of May 2007;
issued and outstanding 118,743 as of May 2006
|
1,209 | 1,187 | ||||||
Paid-in capital
|
584,845 | 545,422 | ||||||
Treasury stock, at cost
|
||||||||
Accumulated other comprehensive income
|
25,140 | 29,839 | ||||||
Retained earnings
|
475,676 | 349,493 | ||||||
Total stockholders equity
|
1,086,870 | 925,941 | ||||||
Total Liabilities and Stockholders Equity
|
$ | 3,333,149 | $ | 2,996,064 | ||||
Year Ended May 31 | 2007 | 2006 | 2005 | |||||||||
Net Sales
|
$ | 3,338,764 | $ | 3,008,338 | $ | 2,555,735 | ||||||
Cost of Sales
|
1,978,312 | 1,760,973 | 1,452,761 | |||||||||
Gross Profit
|
1,360,452 | 1,247,365 | 1,102,974 | |||||||||
Selling, General and Administrative Expenses
|
1,020,884 | 948,497 | 825,868 | |||||||||
Asbestos (Income) Charges
|
(15,000 | ) | 380,000 | 78,000 | ||||||||
Interest Expense, Net
|
47,033 | 41,343 | 35,378 | |||||||||
Income (Loss) Before Income Taxes
|
307,535 | (122,475 | ) | 163,728 | ||||||||
Provision (Benefit) for Income Taxes
|
99,246 | (46,270 | ) | 58,696 | ||||||||
Net Income (Loss)
|
$ | 208,289 | $ | (76,205 | ) | $ | 105,032 | |||||
Average Number of Shares of Common Stock Outstanding
|
||||||||||||
Basic
|
118,179 | 116,837 | 116,899 | |||||||||
Diluted
|
128,711 | 116,837 | 126,364 | |||||||||
Earnings (Loss) per Share of Common Stock
|
||||||||||||
Basic
|
$ | 1.76 | $ | (0.65 | ) | $ | 0.90 | |||||
Diluted
|
$ | 1.64 | $ | (0.65 | ) | $ | 0.86 | |||||
Cash Dividends per Share of Common Stock
|
$ | 0.685 | $ | 0.630 | $ | 0.590 | ||||||
Year Ended May 31 | 2007 | 2006 | 2005 | |||||||||
Cash Flows From Operating Activities:
|
||||||||||||
Net income (loss)
|
$ | 208,289 | $ | (76,205 | ) | $ | 105,032 | |||||
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
|
||||||||||||
Depreciation
|
59,256 | 56,463 | 49,841 | |||||||||
Amortization
|
22,351 | 17,836 | 16,151 | |||||||||
Provision for asbestos-related liabilities
|
380,000 | 78,000 | ||||||||||
Deferred income taxes
|
32,740 | (111,308 | ) | 125 | ||||||||
Earnings of unconsolidated affiliates
|
(914 | ) | (890 | ) | (354 | ) | ||||||
Changes in assets and liabilities, net of effect
from purchases and sales of businesses:
|
||||||||||||
(Increase) decrease in receivables
|
(75,185 | ) | (59,734 | ) | (63,611 | ) | ||||||
(Increase) decrease in inventory
|
(23,864 | ) | (42,255 | ) | (44,429 | ) | ||||||
(Increase) decrease in prepaid expenses and other
current and long-term assets
|
(17,777 | ) | (20,260 | ) | (20,220 | ) | ||||||
Increase (decrease) in accounts payable
|
37,656 | 42,315 | 69,037 | |||||||||
Increase (decrease) in accrued compensation and benefits
|
(4,335 | ) | 38,513 | 6,621 | ||||||||
Increase (decrease) in accrued loss reserves
|
6,501 | 1,226 | 8,753 | |||||||||
Increase (decrease) in other accrued liabilities
|
54,879 | 22,402 | 17,002 | |||||||||
Payments made for asbestos-related claims
|
(67,017 | ) | (59,887 | ) | (67,435 | ) | ||||||
Other, including exchange rate changes
|
(30,275 | ) | (2,727 | ) | 2,839 | |||||||
Cash From Operating Activities
|
202,305 | 185,489 | 157,352 | |||||||||
Cash Flows From Investing Activities:
|
||||||||||||
Capital expenditures
|
(70,393 | ) | (61,155 | ) | (55,609 | ) | ||||||
Acquisition of businesses, net of cash acquired
|
(124,154 | ) | (174,625 | ) | (20,100 | ) | ||||||
Purchases of marketable securities
|
(96,695 | ) | (59,416 | ) | (44,309 | ) | ||||||
Proceeds from sales of marketable securities
|
78,530 | 50,105 | 39,154 | |||||||||
(Investments in) and distributions from unconsolidated affiliates
|
72 | (895 | ) | 136 | ||||||||
Proceeds from sales of assets and businesses
|
1,516 | 9,282 | 5,426 | |||||||||
Other
|
2,873 | 2,323 | (666 | ) | ||||||||
Cash (Used For) Investing Activities
|
(208,251 | ) | (234,381 | ) | (75,968 | ) | ||||||
Cash Flows From Financing Activities:
|
||||||||||||
Additions to long-term and short-term debt
|
153,516 | 186,772 | 200,153 | |||||||||
Reductions of long-term and short-term debt
|
(53,560 | ) | (152,862 | ) | (79,665 | ) | ||||||
Cash dividends
|
(82,106 | ) | (74,427 | ) | (68,933 | ) | ||||||
Tax benefit from exercise of stock options
|
1,549 | |||||||||||
Exercise of stock options
|
25,833 | 10,636 | 12,543 | |||||||||
Cash From (Used For) Financing Activities
|
45,232 | (29,881 | ) | 64,098 | ||||||||
Effect of Exchange Rate Changes on Cash and
Short-Term Investments
|
11,114 | 3,249 | 4,099 | |||||||||
Net Change in Cash and Short-Term Investments
|
50,400 | (75,524 | ) | 149,581 | ||||||||
Cash and Short-Term Investments at Beginning of Year
|
108,616 | 184,140 | 34,559 | |||||||||
Cash and Short-Term Investments at End of Year
|
$ | 159,016 | $ | 108,616 | $ | 184,140 | ||||||
Supplemental Disclosures of Cash Flows Information:
|
||||||||||||
Cash paid during the year for:
|
||||||||||||
Interest
|
$ | 57,929 | $ | 50,690 | $ | 39,279 | ||||||
Income taxes
|
$ | 51,971 | $ | 68,263 | $ | 48,535 | ||||||
Supplemental Schedule of Non-Cash Investing
and Financing Activities:
|
||||||||||||
Share-based compensation activity
|
$ | 7,746 | $ | 3,545 | $ | 1,960 | ||||||
Debt from business combinations
|
$ | 7,828 | $ | 10,259 |
Accumulated | ||||||||||||||||||||||||||||
Common Stock | Other | |||||||||||||||||||||||||||
Number | Par/ | Comprehensive | ||||||||||||||||||||||||||
of | Stated | Paid-in | Treasury | Income | Retained | |||||||||||||||||||||||
Shares | Value | Capital | Stock | (Loss) | Earnings | Total | ||||||||||||||||||||||
Balance at June 1, 2004
|
116,122 | $ | 1,161 | $ | 509,096 | $ | -0- | $ | (3,881 | ) | $ | 464,026 | $ | 970,402 | ||||||||||||||
Comprehensive income
|
||||||||||||||||||||||||||||
Net income
|
105,032 | 105,032 | ||||||||||||||||||||||||||
Translation gain and other
|
13,885 | 13,885 | ||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Comprehensive income
|
118,917 | |||||||||||||||||||||||||||
Dividends paid
|
(68,933 | ) | (68,933 | ) | ||||||||||||||||||||||||
Stock option exercises, net
|
1,109 | 11 | 12,532 | 12,543 | ||||||||||||||||||||||||
Stock-based compensation expense
|
2,850 | 2,850 | ||||||||||||||||||||||||||
Restricted stock awards, net
|
323 | 4 | 1,956 | 1,960 | ||||||||||||||||||||||||
Balance at May 31, 2005
|
117,554 | 1,176 | 526,434 | -0- | 10,004 | 500,125 | 1,037,739 | |||||||||||||||||||||
Comprehensive income
|
||||||||||||||||||||||||||||
Net (loss)
|
(76,205 | ) | (76,205 | ) | ||||||||||||||||||||||||
Translation gain and other
|
19,835 | 19,835 | ||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Comprehensive (loss)
|
(56,370 | ) | ||||||||||||||||||||||||||
Dividends paid
|
(74,427 | ) | (74,427 | ) | ||||||||||||||||||||||||
Stock option exercises, net
|
823 | 8 | 10,628 | 10,636 | ||||||||||||||||||||||||
Stock-based compensation expense
|
4,818 | 4,818 | ||||||||||||||||||||||||||
Restricted stock awards, net
|
366 | 3 | 3,542 | 3,545 | ||||||||||||||||||||||||
Balance at May 31, 2006
|
118,743 | 1,187 | 545,422 | -0- | 29,839 | 349,493 | 925,941 | |||||||||||||||||||||
Comprehensive income
|
||||||||||||||||||||||||||||
Net income
|
208,289 | 208,289 | ||||||||||||||||||||||||||
Translation gain and other
|
37,580 | 37,580 | ||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Comprehensive income
|
245,869 | |||||||||||||||||||||||||||
Impact of adoption of SFAS No. 158,
net of taxes of $22,468
|
(42,279 | ) | (42,279 | ) | ||||||||||||||||||||||||
Dividends paid
|
(82,106 | ) | (82,106 | ) | ||||||||||||||||||||||||
Stock option exercises, net
|
1,798 | 18 | 25,815 | 25,833 | ||||||||||||||||||||||||
Stock-based compensation expense
|
5,862 | 5,862 | ||||||||||||||||||||||||||
Restricted stock awards, net
|
365 | 4 | 7,746 | 7,750 | ||||||||||||||||||||||||
Balance at May 31, 2007
|
120,906 | $ | 1,209 | $ | 584,845 | $ | -0- | $ | 25,140 | $ | 475,676 | $ | 1,086,870 | |||||||||||||||
Intangible Asset | ||||||||
Amortization Life | ||||||||
(In thousands) | (In Years) | Total | ||||||
Current assets
|
$ | 34,678 | ||||||
Property, plant and equipment
|
15,145 | |||||||
Goodwill
|
N/A | 71,918 | ||||||
Tradenames indefinite lives
|
N/A | 13,053 | ||||||
Other intangible assets
|
10 - 20 | 29,114 | ||||||
Total Assets Acquired
|
$ | 163,908 | ||||||
Liabilities assumed
|
(38,451 | ) | ||||||
Net Assets Acquired
|
$ | 125,457 | ||||||
Intangible Asset | ||||||||
Amortization Life | ||||||||
(In thousands) | (In Years) | illbruck | ||||||
Current assets
|
$ | 63,740 | ||||||
Property, plant and equipment
|
32,562 | |||||||
Goodwill
|
N/A | 50,867 | ||||||
Tradenames indefinite lives
|
N/A | 27,190 | ||||||
Tradenames other
|
12 - 15 | 1,639 | ||||||
Other intangible assets
|
4 - 12 | 21,805 | ||||||
Total Assets Acquired
|
$ | 197,803 | ||||||
Liabilities assumed
|
(63,633 | ) | ||||||
Net Assets Acquired
|
$ | 134,170 | ||||||
Minimum Pension | ||||||||||||||||||||
Foreign | and Other | Unrealized | Unrealized | |||||||||||||||||
Currency | Postretirement | Gain (Loss) | Gain (Loss) | |||||||||||||||||
Translation | Benefit Liability | on | on | |||||||||||||||||
(In thousands) | Adjustments | Adjustments | Derivatives | Securities | Total | |||||||||||||||
Balance at June 1, 2004
|
$ | (123 | ) | $ | (5,055 | ) | $ | $ | 1,297 | $ | (3,881 | ) | ||||||||
Reclassification adjustments for (gains)
included in net income
|
(73 | ) | (73 | ) | ||||||||||||||||
Other comprehensive income (loss)
|
15,008 | (2,379 | ) | 1,082 | 13,711 | |||||||||||||||
Deferred taxes
|
529 | (282 | ) | 247 | ||||||||||||||||
Balance at May 31, 2005
|
14,885 | (6,905 | ) | 2,024 | 10,004 | |||||||||||||||
Reclassification adjustments for (gains)
included in net (loss)
|
(17 | ) | (17 | ) | ||||||||||||||||
Other comprehensive income (loss)
|
30,160 | (14,700 | ) | (3,010 | ) | 1,443 | 13,893 | |||||||||||||
Deferred taxes
|
5,413 | 1,011 | (465 | ) | 5,959 | |||||||||||||||
Balance at May 31, 2006
|
45,045 | (16,192 | ) | (1,999 | ) | 2,985 | 29,839 | |||||||||||||
Reclassification adjustments for (gains)
included in net income
|
(1,501 | ) | (1,501 | ) | ||||||||||||||||
Other comprehensive income (loss)
|
25,954 | 1,974 | 7,850 | 10,056 | 45,834 | |||||||||||||||
Deferred taxes
|
(1,317 | ) | (2,540 | ) | (2,896 | ) | (6,753 | ) | ||||||||||||
Impact of adopting SFAS No. 158, net of taxes of $22,468
|
(42,279 | ) | (42,279 | ) | ||||||||||||||||
Balance at May 31, 2007
|
$ | 70,999 | $ | (57,814 | ) | $ | 3,311 | $ | 8,644 | $ | 25,140 | |||||||||
May 31 | 2007 | 2006 | ||||||
(In thousands) | ||||||||
Raw materials and supplies
|
$ | 138,541 | $ | 124,573 | ||||
Finished goods
|
299,218 | 274,441 | ||||||
Total Inventories
|
$ | 437,759 | $ | 399,014 | ||||
Industrial | Consumer | |||||||||||
(In thousands) | Segment | Segment | Total | |||||||||
Balance as of
June 1, 2005
|
$ | 316,426 | $ | 346,798 | $ | 663,224 | ||||||
Acquisitions
|
69,252 | 3,234 | 72,486 | |||||||||
Purchase accounting
adjustments
1
|
2,204 | 2,204 | ||||||||||
Translation adjustments
|
11,134 | 1,587 | 12,721 | |||||||||
Balance as of
May 31, 2006
|
396,812 | 353,823 | 750,635 | |||||||||
Acquisitions
|
20,636 | 51,282 | 71,918 | |||||||||
Purchase accounting
adjustments
2
|
(1,208 | ) | (919 | ) | (2,127 | ) | ||||||
Tax adjustments
3
|
(577 | ) | (68 | ) | (645 | ) | ||||||
Translation adjustments
|
7,397 | 2,999 | 10,396 | |||||||||
Balance as of
May 31, 2007
|
$ | 423,060 | $ | 407,117 | $ | 830,177 | ||||||
1 | Relates primarily to other accruals. | |
2 | Relates primarily to other accruals and illbruck purchase price settlement. | |
3 | Represents valuation allowance adjustments related to the deferred tax assets recorded in purchase accounting. Refer to Note C, Income Taxes, for additional information. |
Gross | Net Other | |||||||||||||||
Amortization | Carrying | Accumulated | Intangible | |||||||||||||
(In thousands) | Period (in Years) | Amount | Amortization | Assets | ||||||||||||
As of May 31, 2007
|
||||||||||||||||
Amortized intangible assets
|
||||||||||||||||
Formulae
|
10 to 33 | $ | 199,076 | $ | 84,086 | $ | 114,990 | |||||||||
Customer-related intangibles
|
7 to 33 | 101,628 | 29,548 | 72,080 | ||||||||||||
Trademarks/names
|
5 to 40 | 18,341 | 5,051 | 13,290 | ||||||||||||
Other
|
3 to 30 | 27,064 | 14,914 | 12,150 | ||||||||||||
Total Amortized Intangibles
|
346,109 | 133,599 | 212,510 | |||||||||||||
Unamortized intangible assets
|
||||||||||||||||
Trade names
|
138,925 | 138,925 | ||||||||||||||
Total Other Intangible Assets
|
$ | 485,034 | $ | 133,599 | $ | 351,435 | ||||||||||
As of May 31, 2006
|
||||||||||||||||
Amortized intangible assets
|
||||||||||||||||
Formulae
|
10 to 33 | $ | 190,665 | $ | 74,551 | $ | 116,114 | |||||||||
Customer-related intangibles
|
7 to 33 | 82,739 | 23,799 | 58,940 | ||||||||||||
Trademarks/names
|
5 to 40 | 18,607 | 5,593 | 13,014 | ||||||||||||
Other
|
3 to 30 | 26,468 | 13,626 | 12,842 | ||||||||||||
Total Amortized Intangibles
|
318,479 | 117,569 | 200,910 | |||||||||||||
Unamortized intangible assets
|
||||||||||||||||
Trade names
|
121,032 | 121,032 | ||||||||||||||
Total Other Intangible Assets
|
$ | 439,511 | $ | 117,569 | $ | 321,942 | ||||||||||
Land improvements
|
5 to 40 years | |
Buildings and improvements
|
5 to 50 years | |
Machinery and equipment
|
2 to 40 years |
RPM International Inc. and Subsidiaries 41
42 RPM International Inc. and Subsidiaries
Year ended May 31 | 2007 | 2006 | 2005 | |||||||||
(In thousands, except per share amounts) | ||||||||||||
Shares Outstanding
|
||||||||||||
For computation of basic earnings per share of common stock
|
||||||||||||
Weighted average shares
|
118,179 | 116,837 | 116,899 | |||||||||
Total shares for basic earnings per share
|
118,179 | 116,837 | 116,899 | |||||||||
For computation of diluted earnings per share of common stock
|
||||||||||||
Net issuable common share equivalents
1
|
2,498 | 1,431 | ||||||||||
Additional shares issuable assuming conversion
of convertible securities
1
|
8,034 | 8,034 | ||||||||||
Total shares for diluted earnings per share
|
128,711 | 116,837 | 126,364 | |||||||||
Net Income
|
||||||||||||
Net income (loss) applicable to shares of common stock
for basic earnings per share
|
$ | 208,289 | $ | (76,205 | ) | $ | 105,032 | |||||
Add: Income effect of contingently issuable shares
|
3,085 | 3,099 | ||||||||||
Net income (loss) applicable to shares of common stock
for diluted earnings per share
|
$ | 211,374 | $ | (76,205 | ) | $ | 108,131 | |||||
Basic Earnings (Loss) Per Share of Common Stock
|
$ | 1.76 | $ | (0.65 | ) | $ | 0.90 | |||||
Diluted Earnings (Loss) Per Share of Common Stock
|
$ | 1.64 | $ | (0.65 | ) | $ | 0.86 | |||||
1 | For the year ended May 31, 2006, net issuable common share equivalents totaling 2.8 million shares, and shares relating to our convertible securities and their related income effect, totaling 8.0 million shares and $3.7 million, respectively, were not assumed in our computation of fully diluted earnings per share, since the result would have been anti-dilutive. |
RPM International Inc. and Subsidiaries 43
May 31 | 2007 | 2006 | ||||||
(In thousands) | ||||||||
Unsecured 4.45% senior notes due October 15, 2009.
1
|
$ | 193,711 | $ | 189,993 | ||||
Unsecured 6.25% senior notes due December 15, 2013.
|
200,000 | 200,000 | ||||||
Unsecured $297,000 face value at maturity 2.75% senior convertible notes due May 13, 2033.
|
150,042 | 150,042 | ||||||
Unsecured notes due March 1, 2008. Interest, which is tied to LIBOR, averaged 5.36% at May 31, 2007.
|
100,000 | 100,000 | ||||||
Unsecured 6.70% senior notes due November 1, 2015.
2
|
150,000 | 150,000 | ||||||
Unsecured senior notes due insurance companies.
3
|
40,000 | |||||||
Revolving credit agreement for $400,000 with a syndicate of banks, through December 29, 2011.
Interest, which is tied to LIBOR, averaged 5.845% for U.S. dollar denominated debt and
6.1875% for Sterling Pound denominated debt at May 31, 2007.
|
123,017 | 10,000 | ||||||
Accounts receivable securitization program for $125,000 with two banks, through May 12, 2009.
Interest averaged 5.34% as of May 31, 2007.
|
65,000 | 25,000 | ||||||
Other obligations, including capital leases, and unsecured notes payable at various rates of
interest due in installments through 2011.
|
6,287 | 11,521 | ||||||
|
988,057 | 876,556 | ||||||
Less current portion
|
101,641 | 6,141 | ||||||
Total Long-Term Debt, Less Current Maturities
|
$ | 886,416 | $ | 870,415 | ||||
1 | We entered into an interest rate swap, which has the effect of converting this fixed-rate note to variable rates based on the six-month London Interbank Offered Rate (LIBOR). The weighted average effective rate was 5.88% as of May 31, 2007. | |
2 | We entered into a cross-currency swap, which fixed the interest and principal payments in euros, resulting in an effective fixed rate borrrowing of 5.31%. | |
3 | On July 18, 2006, we prepaid our $10,000 6.61% Senior Notes, Series B, due November 15, 2006, and our $30,000 7.30% Senior Notes, Series C, due November 15, 2008. We did not incur any material early termination penalties in connection with our termination of these Notes. |
44 RPM International Inc. and Subsidiaries
RPM International Inc. and Subsidiaries 45
Year Ended May 31 | 2007 | 2006 | 2005 | |||||||||
(In thousands) | ||||||||||||
United States
|
$ | 215,859 | $ | (181,282 | ) | $ | 115,192 | |||||
Foreign
|
91,676 | 58,807 | 48,536 | |||||||||
|
||||||||||||
Income (Loss) Before Income Taxes
|
$ | 307,535 | $ | (122,475 | ) | $ | 163,728 | |||||
|
Year Ended May 31 | 2007 | 2006 | 2005 | |||||||||
(In thousands) | ||||||||||||
Current:
|
||||||||||||
U.S. federal
|
$ | 28,276 | $ | 35,035 | $ | 31,313 | ||||||
State and local
|
7,007 | 7,232 | 8,098 | |||||||||
Foreign
|
31,223 | 22,771 | 19,160 | |||||||||
|
66,506 | 65,038 | 58,571 | |||||||||
Deferred:
|
||||||||||||
U.S. federal
|
36,455 | (108,373 | ) | (2,544 | ) | |||||||
State and local
|
(264 | ) | (3,798 | ) | (218 | ) | ||||||
Foreign
|
(3,451 | ) | 863 | 2,887 | ||||||||
|
32,740 | (111,308 | ) | 125 | ||||||||
Provision (Benefit) for Income Taxes
|
$ | 99,246 | $ | (46,270 | ) | $ | 58,696 | |||||
2007 | 2006 | |||||||
(In thousands) | ||||||||
Deferred income tax assets related to:
|
||||||||
Inventories
|
$ | 7,234 | $ | 4,322 | ||||
Allowance for losses
|
532 | 5,511 | ||||||
Accrued compensation and benefits
|
41,730 | 17,844 | ||||||
Asbestos-related liabilities
|
125,932 | 151,478 | ||||||
Accrued other expenses
|
3,348 | 7,986 | ||||||
Other long-term liabilities
|
21,145 | 28,183 | ||||||
Net operating loss and credit carryforwards
|
31,142 | 33,647 | ||||||
Total deferred income tax assets
|
231,063 | 248,971 | ||||||
Less: valuation allowances
|
(21,838 | ) | (18,981 | ) | ||||
Net deferred income tax assets
|
209,225 | 229,990 | ||||||
Deferred income tax (liabilities) related to:
|
||||||||
Depreciation
|
(56,408 | ) | (58,449 | ) | ||||
Pension and other postretirement benefits
|
(10,101 | ) | (10,128 | ) | ||||
Amortization of intangibles
|
(102,643 | ) | (92,280 | ) | ||||
Total deferred income tax (liabilities)
|
(169,152 | ) | (160,857 | ) | ||||
Deferred Income Tax Assets, Net
|
$ | 40,073 | $ | 69,133 | ||||
46 RPM International Inc. and Subsidiaries
Year Ended May 31 | 2007 | 2006 | 2005 | |||||||||
Income tax expense at the U.S. statutory federal income tax rate
|
35.0 | % | (35.0 | %) | 35.0 | % | ||||||
Impact of foreign operations
|
(3.8 | %) | (6.4 | %) | (4.8 | %) | ||||||
State and local income taxes net of federal income tax benefit
|
1.4 | % | 1.8 | % | 3.1 | % | ||||||
Tax benefits from the extraterritorial income exclusion
|
(0.1 | %) | (0.7 | %) | (0.5 | %) | ||||||
Valuation allowance
|
0.8 | % | 3.9 | % | 2.6 | % | ||||||
Other
|
(1.0 | %) | (1.4 | %) | 0.4 | % | ||||||
Effective Income Tax Expense (Benefit) Rate
|
32.3 | % | (37.8 | %) | 35.8 | % | ||||||
RPM International Inc. and Subsidiaries 47
Year ended May 31 | 2007 | 2006 | 2005 | |||||||||
(In thousands) | ||||||||||||
Selling, general and administrative expense
|
$ | 10,509 | $ | 6,719 | $ | 4,798 | ||||||
Income tax expense (benefit)
|
(3,381 | ) | (1,852 | ) | (1,177 | ) | ||||||
Total stock-based compensation cost
|
$ | 7,128 | $ | 4,867 | $ | 3,621 | ||||||
Year Ended May 31 | 2007 | 2006 | 2005 | |||||||||
Risk-free interest rate
|
4.6 | % | 4.2 | % | 3.7 | % | ||||||
Expected life of option
|
6.7 | yrs | 6.0 | yrs | 6.4 | yrs | ||||||
Expected dividend yield
|
3.7 | % | 3.6 | % | 3.4 | % | ||||||
Expected volatility rate
|
27.4 | % | 27.7 | % | 31.0 | % | ||||||
48 RPM International Inc. and Subsidiaries
2007 | 2006 | 2005 | ||||||||||||||||||||||
Weighted | Number | Weighted | Number | Weighted | Number | |||||||||||||||||||
Average | of Shares | Average | of Shares | Average | of Shares | |||||||||||||||||||
Exercise | Under | Exercise | Under | Exercise | Under | |||||||||||||||||||
Shares Under Option | Price | Option | Price | Option | Price | Option | ||||||||||||||||||
(In thousands, except per share amounts) | ||||||||||||||||||||||||
Balance at June 1
|
$ | 14.34 | 6,414 | $ | 13.90 | 6,764 | $ | 13.23 | 7,403 | |||||||||||||||
Options granted
|
18.80 | 380 | 17.65 | 560 | 17.60 | 584 | ||||||||||||||||||
Options canceled/expired
|
14.75 | (43 | ) | 14.48 | (87 | ) | 13.57 | (76 | ) | |||||||||||||||
Options exercised
|
14.37 | (1,801 | ) | 12.93 | (823 | ) | 11.53 | (1,147 | ) | |||||||||||||||
Balance at May 31
|
$ | 14.67 | 4,950 | $ | 14.34 | 6,414 | $ | 13.90 | 6,764 | |||||||||||||||
Exercisable at May 31
|
$ | 13.73 | 3,630 | $ | 13.68 | 4,587 | $ | 13.41 | 4,578 | |||||||||||||||
(Shares in thousands) | Weighted | Number of | Weighted Average | |||||||||
Average | Shares | Remaining | ||||||||||
Grant-Date | Under | Contractual | ||||||||||
Fair Value | Option | Term | ||||||||||
June 1, 2006
|
$ | 4.15 | 1,829 | |||||||||
Granted
|
4.34 | 380 | ||||||||||
Vested
|
4.15 | (861 | ) | |||||||||
Forfeited/expired
|
4.12 | (28 | ) | |||||||||
May 31, 2007
|
$ | 4.21 | 1,320 | 8.04 | ||||||||
RPM International Inc. and Subsidiaries 49
(Shares in thousands) | Weighted | |||||||
Average | ||||||||
Grant-Date | Number of | |||||||
Fair Value | Shares | |||||||
June 1, 2006
|
$ | 14.92 | 1,367 | |||||
Granted
|
18.78 | 444 | ||||||
Vested
|
15.76 | (51 | ) | |||||
Forfeited/expired
|
13.26 | (72 | ) | |||||
May 31, 2007
|
$ | 15.98 | 1,688 | |||||
50 RPM International Inc. and Subsidiaries
May 31 | ||||
(In thousands) | ||||
2008
|
$ | 29,663 | ||
2009
|
21,253 | |||
2010
|
15,327 | |||
2011
|
9,771 | |||
2012
|
7,011 | |||
Thereafter
|
25,328 | |||
Total Minimum Lease Commitments
|
$ | 108,353 | ||
Before Application | After Application | |||||||||||
At May 31, 2007 | of SFAS No. 158 | Adjustments | of SFAS No. 158 | |||||||||
(In thousands) | ||||||||||||
Prepaids and other current assets
|
$ | 204,830 | $ | (14,891 | ) | $ | 189,939 | |||||
Intangible assets
|
351,443 | (8 | ) | 351,435 | ||||||||
Deferred income taxes current
|
39,539 | (263 | ) | 39,276 | ||||||||
Total Assets
|
3,348,311 | (15,162 | ) | 3,333,149 | ||||||||
Current liabilities
|
863,343 | 1,397 | 864,740 | |||||||||
Other long-term liabilities
|
128,123 | 47,835 | 175,958 | |||||||||
Deferred income taxes non-current
|
40,012 | (22,115 | ) | 17,897 | ||||||||
Total Liabilities
|
2,219,162 | 27,117 | 2,246,279 | |||||||||
Accumulated other comprehensive income (loss), net of tax
|
67,419 | (42,279 | ) | 25,140 | ||||||||
Total Stockholders Equity
|
1,129,149 | (42,279 | ) | 1,086,870 | ||||||||
U.S. Plans | Non-U.S. Plans | |||||||||||||||||||||||
(In thousands) | 2007 | 2006 | 2005 | 2007 | 2006 | 2005 | ||||||||||||||||||
Service cost
|
$ | 13,224 | $ | 13,270 | $ | 11,231 | $ | 3,135 | $ | 2,475 | $ | 2,154 | ||||||||||||
Interest cost
|
9,063 | 8,245 | 7,481 | 5,095 | 4,741 | 4,359 | ||||||||||||||||||
Expected return on plan assets
|
(11,428 | ) | (10,108 | ) | (9,759 | ) | (5,047 | ) | (4,599 | ) | (4,117 | ) | ||||||||||||
Amortization of:
|
||||||||||||||||||||||||
Prior service cost
|
193 | 194 | 294 | 22 | ||||||||||||||||||||
Net gain on adoption of SFAS No. 87
|
(2 | ) | (3 | ) | ||||||||||||||||||||
Net actuarial (gains) losses recognized
|
2,397 | 2,375 | 1,500 | 1,803 | 1,511 | 1,394 | ||||||||||||||||||
Curtailment/settlement (gains) losses
|
65 | |||||||||||||||||||||||
Net Pension Cost
|
$ | 13,514 | $ | 13,974 | $ | 10,744 | $ | 5,008 | $ | 4,128 | $ | 3,790 | ||||||||||||
U.S. Plans | Non-U.S. Plans | |||||||||||||||
(In thousands) | 2007 | 2006 | 2007 | 2006 | ||||||||||||
Benefit obligation at beginning of year
|
$ | 161,669 | $ | 148,505 | $ | 103,713 | $ | 89,190 | ||||||||
Service cost
|
13,224 | 13,270 | 3,135 | 2,475 | ||||||||||||
Interest cost
|
9,063 | 8,245 | 5,095 | 4,741 | ||||||||||||
Benefits paid
|
(11,558 | ) | (9,627 | ) | (3,057 | ) | (3,067 | ) | ||||||||
Participant contributions
|
903 | 773 | ||||||||||||||
Acquisitions
|
5,422 | 1,230 | ||||||||||||||
Plan amendments
|
258 | |||||||||||||||
Actuarial losses
|
5,666 | 1,276 | 2,997 | 9,997 | ||||||||||||
Settlements
|
(144 | ) | ||||||||||||||
Premiums paid
|
(143 | ) | ||||||||||||||
Currency exchange rate changes
|
5,515 | (1,884 | ) | |||||||||||||
Benefit Obligation at End of Year
|
$ | 177,920 | $ | 161,669 | $ | 123,580 | $ | 103,713 | ||||||||
Fair value of plan assets at beginning of year
|
$ | 130,268 | $ | 118,091 | $ | 72,982 | $ | 65,923 | ||||||||
Actual return on plan assets
|
11,442 | 13,591 | 6,600 | 8,015 | ||||||||||||
Employer contributions
|
13,790 | 8,213 | 7,597 | 2,661 | ||||||||||||
Participant contributions
|
903 | 773 | ||||||||||||||
Acquisitions
|
5,612 | 119 | ||||||||||||||
Benefits paid
|
(11,558 | ) | (9,627 | ) | (3,057 | ) | (3,067 | ) | ||||||||
Settlements
|
(144 | ) | ||||||||||||||
Premiums paid
|
(143 | ) | ||||||||||||||
Currency exchange rate changes
|
3,865 | (1,442 | ) | |||||||||||||
Fair Value of Plan Assets at End of Year
|
$ | 143,798 | $ | 130,268 | $ | 94,359 | $ | 72,982 | ||||||||
(Deficit) of plan assets versus benefit obligations at end of year
|
$ | (34,122 | ) | $ | (31,401 | ) | $ | (29,221 | ) | $ | (30,731 | ) | ||||
Contributions after measurement date
|
61 | 1,941 | 2,437 | 1,268 | ||||||||||||
Unrecognized actuarial (gains) losses
|
N/A | 43,409 | N/A | 33,147 | ||||||||||||
Unrecognized prior service cost
|
N/A | 2,352 | N/A | 232 | ||||||||||||
Unrecognized net transitional asset
|
N/A | N/A | ||||||||||||||
Net Amount Recognized
|
$ | (34,061 | ) | $ | 16,301 | $ | (26,784 | ) | $ | 3,916 | ||||||
Accumulated Benefit Obligation
|
$ | 135,463 | $ | 125,208 | $ | 108,749 | $ | 92,784 | ||||||||
U.S. Plans | Non-U.S. Plans | |||||||||||||||
(In thousands) | 2007 | 2006 | 2007 | 2006 | ||||||||||||
Prepaid benefit cost
|
N/A | $ | 16,672 | N/A | $ | | ||||||||||
Accrued benefit liability
|
N/A | (848 | ) | N/A | (19,019 | ) | ||||||||||
Accumulated other comprehensive loss
|
N/A | 468 | N/A | 22,935 | ||||||||||||
Intangible asset
|
N/A | 9 | N/A | |||||||||||||
Net Amount Recognized
|
N/A | $ | 16,301 | N/A | $ | 3,916 | ||||||||||
U.S. Plans | Non-U.S. Plans | |||||||||||||||
(In thousands) | 2007 | 2006 | 2007 | 2006 | ||||||||||||
Noncurrent assets
|
$ | | N/A | $ | 275 | N/A | ||||||||||
Current liabilities
|
(104 | ) | N/A | (296 | ) | N/A | ||||||||||
Noncurrent liabilities
|
(33,957 | ) | N/A | (26,763 | ) | N/A | ||||||||||
Net Amount Recognized
|
$ | (34,061 | ) | N/A | $ | (26,784 | ) | N/A | ||||||||
U.S. Plans | ||||||||||||||||
2007 | 2006 | |||||||||||||||
Benefit | Plan | Benefit | Plan | |||||||||||||
(In thousands) | Obligation | Assets | Obligation | Assets | ||||||||||||
Plans with projected benefit
obligation in excess of plan assets
|
$ | 177,920 | $ | 143,798 | $ | 161,669 | $ | 130,268 | ||||||||
Plans with accumulated benefit
obligation in excess of plan assets
|
$ | 1,850 | $ | 1,095 | $ | 1,866 | $ | 987 | ||||||||
Plans with assets in excess of
accumulated benefit obligations
|
$ | 133,613 | $ | 142,703 | $ | 123,342 | $ | 129,281 | ||||||||
Non-U.S. Plans | ||||||||||||||||
2007 | 2006 | |||||||||||||||
Benefit | Plan | Benefit | Plan | |||||||||||||
(In thousands) | Obligation | Assets | Obligation | Assets | ||||||||||||
Plans with projected benefit
obligation in excess of plan assets
|
$ | 117,909 | $ | 88,414 | $ | 103,713 | $ | 72,982 | ||||||||
Plans with accumulated benefit
obligation in excess of plan assets
|
$ | 103,232 | $ | 88,414 | $ | 92,784 | $ | 72,982 | ||||||||
Plans with assets in excess of
projected benefit obligations
|
$ | 5,671 | $ | 5,945 | $ | | $ | | ||||||||
Plans with assets in excess of
accumulated benefit obligations
|
$ | 5,517 | $ | 5,945 | $ | | $ | | ||||||||
(In thousands) | U.S. Plans | Non-U.S. Plans | ||||||
Net loss
|
$ | (46,599 | ) | $ | (33,626 | ) | ||
Prior service costs/(credits)
|
(2,159 | ) | (234 | ) | ||||
Total recognized in accumulated other comprehensive
income not affecting retained earnings
|
$ | (48,758 | ) | $ | (33,860 | ) | ||
(In thousands) | U.S. Plans | Non-U.S. Plans | ||||||
Net loss
|
$ | (2,581 | ) | $ | (1,770 | ) | ||
Prior service costs/(credits)
|
(240 | ) | (25 | ) | ||||
U.S. Plans | Non-U.S. Plans | |||||||||||||||||||||||
Year-End Benefit Obligations | 2007 | 2006 | 2005 | 2007 | 2006 | 2005 | ||||||||||||||||||
Discount rate
|
5.75 | % | 5.75 | % | 5.75 | % | 5.00 | % | 4.89 | % | 5.40 | % | ||||||||||||
Rate of compensation increase
|
3.79 | % | 3.73 | % | 3.50 | % | 3.88 | % | 3.39 | % | 3.63 | % | ||||||||||||
U.S. Plans | Non-U.S. Plans | |||||||||||||||||||||||
Net Periodic Pension Cost | 2007 | 2006 | 2005 | 2007 | 2006 | 2005 | ||||||||||||||||||
Discount rate
|
5.75 | % | 5.75 | % | 6.00 | % | 4.89 | % | 5.40 | % | 5.68 | % | ||||||||||||
Expected return on plan assets
|
8.75 | % | 8.75 | % | 8.75 | % | 6.68 | % | 6.93 | % | 7.31 | % | ||||||||||||
Rate of compensation increase
|
3.73 | % | 3.50 | % | 3.50 | % | 3.39 | % | 3.63 | % | 3.66 | % | ||||||||||||
U.S. Plans | ||||||||||||
Actual Asset | ||||||||||||
Allocation | ||||||||||||
Target Allocation | ||||||||||||
as of February 2007 | 2007 | 2006 | ||||||||||
Equity securities
|
70 | % | 69 | % | 65 | % | ||||||
Fixed income securities
|
25 | % | 20 | % | 20 | % | ||||||
Cash
|
6 | % | 10 | % | ||||||||
Other
|
5 | % | 5 | % | 5 | % | ||||||
Total assets
|
100 | % | 100 | % | 100 | % | ||||||
Non-U.S. Plans | ||||||||||||
Actual Asset | ||||||||||||
Allocation | ||||||||||||
Target Allocation | ||||||||||||
as of February 2007 | 2007 | 2006 | ||||||||||
Equity securities
|
41 | % | 45 | % | 51 | % | ||||||
Fixed income securities
|
51 | % | 47 | % | 47 | % | ||||||
Cash
|
1 | % | 1 | % | ||||||||
Property and other
|
7 | % | 7 | % | 2 | % | ||||||
Total assets
|
100 | % | 100 | % | 100 | % | ||||||
U.S. Plans | Non-U.S. Plans | |||||||||||||||||||||||
(In thousands) | 2007 | 2006 | 2005 | 2007 | 2006 | 2005 | ||||||||||||||||||
Service cost Benefits earned during this period
|
$ | | $ | | $ | 11 | $ | 468 | $ | 365 | $ | 265 | ||||||||||||
Interest cost on the accumulated obligation
|
542 | 615 | 661 | 626 | 539 | 473 | ||||||||||||||||||
Amortization of prior service cost
|
(28 | ) | (27 | ) | ||||||||||||||||||||
Amortization of unrecognized (gains) losses
|
59 | 27 | 96 | 47 | 28 | |||||||||||||||||||
Net Periodic Postretirement Expense
|
$ | 514 | $ | 647 | $ | 699 | $ | 1,190 | $ | 951 | $ | 766 | ||||||||||||
U.S. Plans | Non-U.S. Plans | |||||||||||||||
(In thousands) | 2007 | 2006 | 2007 | 2006 | ||||||||||||
Accumulated postretirement benefit obligation
at beginning of year
|
$ | 9,434 | $ | 11,169 | $ | 10,824 | $ | 8,331 | ||||||||
Service cost
|
468 | 365 | ||||||||||||||
Interest cost
|
542 | 615 | 626 | 539 | ||||||||||||
Benefit payments
|
(862 | ) | (849 | ) | (220 | ) | (190 | ) | ||||||||
Medicare subsidy received
|
150 | |||||||||||||||
Actuarial (gains) losses
|
(192 | ) | (1,488 | ) | 1,068 | |||||||||||
Amendments
|
(13 | ) | ||||||||||||||
Currency exchange rate changes
|
674 | 711 | ||||||||||||||
Accumulated postretirement benefit obligation at end of year
|
9,072 | 9,434 | 12,372 | 10,824 | ||||||||||||
Unrecognized actuarial gains (losses)
|
N/A | (249 | ) | N/A | (2,695 | ) | ||||||||||
Unrecognized prior service cost (benefit)
|
N/A | 294 | N/A | |||||||||||||
Accrued Postretirement Health Care Benefits
|
$ | 9,072 | $ | 9,479 | $ | 12,372 | $ | 8,129 | ||||||||
U.S. Plans | Non-U.S. Plans | |||||||||||||||
(In thousands) | 2007 | 2006 | 2007 | 2006 | ||||||||||||
Prepaid benefit cost
|
N/A | N/A | ||||||||||||||
Accrued benefit liability
|
N/A | $ | (9,479 | ) | N/A | $ | (8,129 | ) | ||||||||
Accumulated other comprehensive loss
|
N/A | N/A | ||||||||||||||
Intangible asset
|
N/A | N/A | ||||||||||||||
Net Amount Recognized
|
N/A | $ | (9,479 | ) | N/A | $ | (8,129 | ) | ||||||||
U.S. Plans | Non-U.S. Plans | |||||||||||||||
(In thousands) | 2007 | 2006 | 2007 | 2006 | ||||||||||||
Noncurrent assets
|
$ | | N/A | $ | | N/A | ||||||||||
Current liabilities
|
(760 | ) | N/A | (238 | ) | N/A | ||||||||||
Noncurrent liabilities
|
(8,312 | ) | N/A | (12,134 | ) | N/A | ||||||||||
Net Amount Recognized
|
$ | (9,072 | ) | N/A | $ | (12,372 | ) | N/A | ||||||||
U.S. Plans | Non-U.S. Plans | |||||||||||||||||||||||
Year-End Benefit Obligations | 2007 | 2006 | 2005 | 2007 | 2006 | 2005 | ||||||||||||||||||
Discount rate
|
6.00 | % | 6.00 | % | 5.75 | % | 5.50 | % | 5.50 | % | 6.00 | % | ||||||||||||
Current healthcare cost trend rate
|
9.00 | % | 9.50 | % | 10.00 | % | 7.00 | % | 7.00 | % | 8.00 | % | ||||||||||||
Ultimate healthcare cost trend rate
|
5.00 | % | 5.00 | % | 5.00 | % | 4.50 | % | 5.00 | % | 5.00 | % | ||||||||||||
Year ultimate healthcare cost trend
rate will be realized
|
2015 | 2015 | 2015 | 2012 | 2008 | 2008 | ||||||||||||||||||
U.S. Plans | Non-U.S. Plans | |||||||||||||||||||||||
Net Periodic Postretirement Benefit Cost | 2007 | 2006 | 2005 | 2007 | 2006 | 2005 | ||||||||||||||||||
Discount rate
|
6.00 | % | 5.75 | % | 6.00 | % | 5.50 | % | 6.00 | % | 6.25 | % | ||||||||||||
Healthcare cost trend rate
|
9.50 | % | 10.00 | % | 10.00 | % | 7.00 | % | 8.00 | % | 9.00 | % | ||||||||||||
Ultimate healthcare cost trend rate
|
5.00 | % | 5.00 | % | 5.00 | % | 5.00 | % | 5.00 | % | 5.00 | % | ||||||||||||
Year ultimate healthcare cost trend
rate will be realized
|
2015 | 2015 | 2014 | 2008 | 2008 | 2008 | ||||||||||||||||||
U.S. Plans | Non-U.S. Plans | |||||||||||||||
(In thousands) | 2007 | 2006 | 2007 | 2006 | ||||||||||||
1% Increase in trend rate
|
||||||||||||||||
Accumulated Benefit Obligation
|
$ | 760 | $ | 808 | $ | 2,753 | $ | 2,408 | ||||||||
Postretirement Cost
|
48 | 55 | 270 | 211 | ||||||||||||
1% Decrease in trend rate
|
||||||||||||||||
Accumulated Benefit Obligation
|
$ | (666 | ) | $ | (708 | ) | $ | (1,603 | ) | $ | (1,844 | ) | ||||
Postretirement Cost
|
(42 | ) | (49 | ) | (177 | ) | (151 | ) | ||||||||
2007 | 2006 | |||||||
(In thousands) | ||||||||
Accrued product liability reserves
|
$ | 55,063 | $ | 53,764 | ||||
Accrued warranty reserves
|
7,195 | 7,524 | ||||||
Accrued environmental reserves
|
10,920 | 5,390 | ||||||
Accrued loss reserves current
|
73,178 | 66,678 | ||||||
Asbestos-related liabilities current
|
53,000 | 58,925 | ||||||
Total Reserves Current
|
$ | 126,178 | $ | 125,603 | ||||
|
||||||||
Accrued warranty and product liability reserves noncurrent
|
$ | 10,319 | $ | 14,758 | ||||
Asbestos-related liabilities noncurrent
|
301,268 | 362,360 | ||||||
Total Reserves Noncurrent
|
$ | 311,587 | $ | 377,118 | ||||
Balance at | Additions to | Deductions (Primarily | Balance at | |||||||||||||
(In thousands) | Beginning of Period | Asbestos Charge | Claims Paid) | End of Period | ||||||||||||
Year Ended May 31, 2007
|
$ | 421,285 | $ | 67,017 | $ | 354,268 | ||||||||||
Year Ended May 31, 2006
|
101,172 | $ | 380,000 | 59,887 | 421,285 | |||||||||||
Year Ended May 31, 2005
|
90,607 | 78,000 | 67,435 | 101,172 | ||||||||||||
Year ended May 31 | 2007 | 2006 | 2005 | |||||||||
(In thousands) | ||||||||||||
Segment Information
|
||||||||||||
Net Sales
|
||||||||||||
Industrial
|
$ | 2,100,386 | $ | 1,811,590 | $ | 1,441,548 | ||||||
Consumer
|
1,238,378 | 1,196,748 | 1,114,187 | |||||||||
Total
|
$ | 3,338,764 | $ | 3,008,338 | $ | 2,555,735 | ||||||
Income (Loss) Before Income Taxes
|
||||||||||||
Industrial
|
$ | 233,120 | $ | 201,230 | $ | 168,578 | ||||||
Consumer
|
151,496 | 159,147 | 147,601 | |||||||||
Corporate/Other
|
(77,081 | ) | (482,852 | ) | (152,451 | ) | ||||||
Total
|
$ | 307,535 | $ | (122,475 | ) 1 | $ | 163,728 | 1 | ||||
Identifiable Assets
|
||||||||||||
Industrial
|
$ | 1,708,606 | $ | 1,628,038 | $ | 1,278,234 | ||||||
Consumer
|
1,285,180 | 1,102,687 | 1,144,909 | |||||||||
Corporate/Other
|
339,363 | 265,339 | 224,332 | |||||||||
Total
|
$ | 3,333,149 | $ | 2,996,064 | $ | 2,647,475 | ||||||
Capital Expenditures
|
||||||||||||
Industrial
|
$ | 49,235 | $ | 39,274 | $ | 30,714 | ||||||
Consumer
|
20,141 | 20,800 | 24,175 | |||||||||
Corporate/Other
|
1,017 | 1,081 | 720 | |||||||||
Total
|
$ | 70,393 | $ | 61,155 | $ | 55,609 | ||||||
Depreciation and Amortization
|
||||||||||||
Industrial
|
$ | 46,453 | $ | 40,536 | $ | 33,213 | ||||||
Consumer
|
30,860 | 29,938 | 29,264 | |||||||||
Corporate/Other
|
4,294 | 3,825 | 3,515 | |||||||||
Total
|
$ | 81,607 | $ | 74,299 | $ | 65,992 | ||||||
|
||||||||||||
Geographic Information
|
||||||||||||
Net Sales (based on shipping location)
|
||||||||||||
United States
|
$ | 2,341,008 | $ | 2,248,259 | $ | 2,009,748 | ||||||
Foreign
|
||||||||||||
Canada
|
255,246 | 222,602 | 192,579 | |||||||||
Europe
|
596,613 | 411,548 | 250,585 | |||||||||
Other Foreign
|
145,897 | 125,929 | 102,823 | |||||||||
Total Foreign
|
997,756 | 760,079 | 545,987 | |||||||||
Total
|
$ | 3,338,764 | $ | 3,008,338 | $ | 2,555,735 | ||||||
Long-Lived Assets
2
|
||||||||||||
United States
|
$ | 1,208,981 | $ | 1,190,722 | $ | 1,158,138 | ||||||
Foreign
|
||||||||||||
Canada
|
132,052 | 121,137 | 98,880 | |||||||||
Europe
|
385,066 | 260,866 | 103,070 | |||||||||
Other Foreign
|
18,107 | 18,027 | 18,392 | |||||||||
Total Foreign
|
535,225 | 400,030 | 220,342 | |||||||||
Total
|
$ | 1,744,206 | $ | 1,590,752 | $ | 1,378,480 | ||||||
1 | Asbestos-related charges, totaling $380.0 million in fiscal 2006 and $78.0 million in fiscal 2005, reflected in Corporate/Other, relate to our Bondex International, Inc. subsidiary. | |
2 | Long-lived assets include all non-current assets, excluding non-current deferred income taxes. |
For Quarter Ended | ||||||||||||||||
(In thousands, except per share amounts) | August 31 | November 30 | February 28 | May 31 | ||||||||||||
2007
|
||||||||||||||||
Net Sales
|
$ | 844,161 | $ | 809,386 | $ | 679,494 | $ | 1,005,723 | ||||||||
Gross Profit
|
345,073 | 326,071 | 263,485 | 425,823 | ||||||||||||
Net Income
|
61,342 | 52,941 | 10,052 | 83,954 | ||||||||||||
Basic Earnings Per Share
|
$ | 0.52 | $ | 0.45 | $ | 0.08 | $ | 0.70 | ||||||||
Diluted Earnings Per Share
|
$ | 0.49 | $ | 0.42 | $ | 0.08 | $ | 0.65 | ||||||||
Dividends Per Share
|
$ | 0.160 | $ | 0.175 | $ | 0.175 | $ | 0.175 | ||||||||
For Quarter Ended | ||||||||||||||||
(In thousands, except per share amounts) | August 31 | November 30 | February 28 | May 31 | ||||||||||||
2006
|
||||||||||||||||
Net Sales
|
$ | 747,352 | $ | 739,350 | $ | 612,475 | $ | 909,161 | ||||||||
Gross Profit
|
315,019 | 298,285 | 243,379 | 390,682 | ||||||||||||
Net Income (Loss)
|
49,961 | 18,527 | (2,687 | ) | (142,006 | ) b | ||||||||||
Basic Earnings (Loss) Per Share
|
$ | 0.43 | $ | 0.16 | $ | (0.02 | ) | $ | (1.21 | ) | ||||||
Diluted Earnings (Loss) Per Share
|
$ | 0.40 | $ | 0.15 | $ | (0.02 | ) a | $ | (1.21 | ) a | ||||||
Dividends Per Share
|
$ | 0.150 | $ | 0.160 | $ | 0.160 | $ | 0.160 | ||||||||
a | Conversion of the net issuable common share equivalents and the shares related to convertible securities for the three month periods ended February 28, 2006 and May 31, 2006 were not assumed, since the results would have been anti-dilutive. | |
b | During the fourth fiscal quarter ended May 31, 2006, we increased our liability for asbestos claims by $335.0 million ($215.6 million after-tax), representing our estimation of our liability for pending and unasserted claims through May 31, 2016. See Note I to the Consolidated Financial Statements for discussion. |
Dividends paid | ||||||||||||
High | Low | per share | ||||||||||
Fiscal 2007
|
||||||||||||
First Quarter
|
$ | 19.12 | $ | 17.53 | $ | 0.160 | ||||||
Second Quarter
|
$ | 20.36 | $ | 17.40 | $ | 0.175 | ||||||
Third Quarter
|
$ | 24.25 | $ | 19.90 | $ | 0.175 | ||||||
Fourth Quarter
|
$ | 24.14 | $ | 21.04 | $ | 0.175 |
Dividends paid | ||||||||||||
High | Low | per share | ||||||||||
Fiscal 2006
|
||||||||||||
First Quarter
|
$ | 19.21 | $ | 17.47 | $ | 0.150 | ||||||
Second Quarter
|
$ | 19.15 | $ | 16.90 | $ | 0.160 | ||||||
Third Quarter
|
$ | 19.00 | $ | 16.96 | $ | 0.160 | ||||||
Fourth Quarter
|
$ | 19.70 | $ | 17.40 | $ | 0.160 |
|
|
|
|
||
Frank C. Sullivan
|
Robert L. Matejka | |
President and Chief Executive Officer
|
Vice President, Chief Financial Officer and Controller |
Medina, Ohio
July 27, 2007
Medina, Ohio
July 27, 2007
Medina, Ohio
for the year ended May 31, 2005, which is as of July 22, 2005.
Jurisdiction of | ||
Name | Incorporation | |
First Colonial Insurance Company, Inc.
|
Vermont | |
First Continental Services Co.
|
Vermont | |
RPM Asia Pte. Ltd.
|
Singapore | |
Espan Corporation Pte. Ltd.
|
Singapore | |
RPM China Pte. Ltd.
|
Singapore | |
Magnagro Industries Pte. Ltd.
|
Singapore | |
Dryvit Wall Systems (Suzhou) Co. Ltd.
|
China | |
RPM Consumer Holding Company
|
Delaware | |
DAP Products Inc.
2
|
Delaware | |
DAP Holdings, LLC
3
|
Delaware | |
Gloucester Co., Inc.
|
Massachusetts | |
Bondo Corporation
|
Ohio | |
Rust-Oleum Corporation
4
|
Illinois | |
Rust-Oleum International, LLC
5
|
Delaware | |
BPAG, Inc.
|
Delaware | |
ROC Sales, Inc.
|
Illinois | |
Rust-Oleum Sales Company, Inc.
|
Ohio | |
Rust-Oleum Service Company
|
Delaware | |
The Flecto Company, Inc.
6
|
California | |
Rust-Oleum Japan Corporation
|
Japan | |
The Testor Corporation
7
|
Ohio | |
Zinsser Co., Inc.
8
|
New Jersey | |
Zinsser Asia Pacific Pty. Limited
|
Australia | |
Zinsser Holdings, LLC
9
|
Delaware | |
Mantrose-Haeuser Co., Inc.
|
Massachusetts | |
Modern Masters Inc.
|
California | |
Zinsser Divestiture Co., Inc.
|
New York | |
RPM Enterprises, Inc.
|
Delaware | |
RPM, Inc.
10
|
Ohio | |
American Emulsions Co., Inc.
|
Georgia | |
Select Dye & Chemical, Inc.
|
Georgia | |
Bondex International, Inc.
|
Ohio | |
Chemical Specialties Manufacturing Corporation
|
Maryland | |
Day-Glo Color Corp.
11
|
Ohio | |
Dryvit Holdings, Inc.
|
Delaware | |
Dryvit Systems, Inc.
12
|
Rhode Island | |
Dryvit Systems USA (Europe) Sp. zo.o.
|
Poland | |
Guardian Protection Products, Inc.
|
Delaware | |
Kop-Coat, Inc.
|
Ohio | |
Kop-Coat New Zealand Limited
|
New Zealand | |
Agpro (N.Z.) Limited
|
New Zealand |
Jurisdiction of | ||
Name | Incorporation | |
RPM Wood Finishes Group, Inc.
13
|
Nevada | |
Chemical Coatings, Inc.
|
North Carolina | |
RPM of Mass., Inc.
|
Massachusetts | |
Westfield Coatings Corporation
|
Massachusetts | |
TCI, Inc.
|
Georgia | |
RPM Industrial Holding Company
|
Delaware | |
Carboline Company
14
|
Delaware | |
PLB Holdings Inc.
|
Nevada | |
A/D Fire Protection Systems Corp.
|
Nevada | |
Carboline International Corporation
15
|
Delaware | |
Carboline Dubai Corporation
|
Missouri | |
StonCor Africa (Pty.) Ltd.
|
South Africa | |
Chemrite Equipment Systems
(Pty.) Ltd.
|
South Africa | |
StonCor Namibia (Pty.) Ltd.
|
Namibia | |
Republic Powdered Metals, Inc.
16
|
Ohio | |
StonCor Group, Inc.
17
|
Delaware | |
Fibergrate Composite Structures
Incorporated
18
|
Delaware | |
Stonhard Nederland B.V.
|
Netherlands | |
Parklin Management Group, Inc.
19
|
New Jersey | |
Stonhard Agencia en Chile
|
Chile | |
StonCor Corrosion Specialists Group Ltda.
20
|
Brazil | |
Tremco Incorporated
21
|
Ohio | |
The Euclid Chemical Company
22
|
Ohio | |
Euclid Chemical International Sales
Corp.
23
|
Ohio | |
Grandcourt N.V.
24
|
Netherlands Antilles | |
Redwood Transport, Inc.
25
|
Ohio | |
Paramount Technical Products, Inc.
|
South Dakota | |
Tremco illbruck AB
|
Sweden | |
Tremco Asia Pacific Pty. Limited
|
Australia | |
Tremco Pty. Limited
|
Australia | |
Tremco Asia Pte. Ltd.
|
Singapore | |
Tremco Barrier Solutions, Inc.
26
|
Delaware | |
Tremco GmbH
|
Germany | |
Weatherproofing Technologies, Inc.
27
|
Delaware | |
RSIF International Limited
|
Ireland | |
Sierra Performance Coatings, Inc.
|
California |
1 | RPM International Inc. owns a 14.99% investment interest in Kemrock Industries & Exports Ltd., a publicly traded Indian company traded on the Bombay Stock Exchange. | |
RPM International Inc. owns 100% of the outstanding voting Common Stock in RPM Funding Corporation, a Delaware corporation. The remaining outstanding shares in RPM Funding Corporation are held as follows: 100% of the outstanding Series A Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series B Preferred Stock (non-voting) by DAP Products Inc.; 100% of the outstanding Series C Preferred Stock (non-voting) by |
2
The Euclid Chemical Company; 100% of the outstanding Series D Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series E Preferred Stock (non-voting) by Rust-Oleum Corporation; 100% of the outstanding Series F Preferred Stock (non-voting) by The Testor Corporation; 100% of the outstanding Series G Preferred Stock (non-voting) by Tremco Incorporated; 100% of the outstanding Series H Preferred Stock (non-voting) by Weatherproofing Technologies, Inc.; 100% of the outstanding Series I Preferred Stock (non-voting) by Zinsser Co., Inc.; and 100% of the outstanding Series J Preferred Stock (non-voting) by Tremco Barrier Solutions, Inc. | ||
RPM Funding Corporation owns 5% of the outstanding shares in Carboline Norge A/S, a Norwegian corporation. Of the remaining outstanding shares in Carboline Norge A/S, Carboline International Corporation owns 40% and 55% are held by a joint venture partner. | ||
2 | DAP Products Inc. owns 100% of the outstanding Series B Preferred Stock (non-voting) in RPM Funding Corporation, a Delaware corporation. The remaining outstanding shares in RPM Funding Corporation are held as follows: 100% of the outstanding voting Common Stock by RPM International Inc.; 100% of the outstanding Series A Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series C Preferred Stock (non-voting) by The Euclid Chemical Company; 100% of the outstanding Series D Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series E Preferred Stock (non-voting) by Rust-Oleum Corporation; 100% of the outstanding Series F Preferred Stock (non-voting) by The Testor Corporation; 100% of the outstanding Series G Preferred Stock (non-voting) by Tremco Incorporated; 100% of the outstanding Series H Preferred Stock (non-voting) by Weatherproofing Technologies, Inc.; 100% of the Outstanding Series I Preferred Stock (non-voting) by Zinsser Co., Inc.; and 100% of the outstanding Series J Preferred Stock (non-voting) by Tremco Barrier Solutions, Inc. | |
RPM Funding Corporation owns 5% of the outstanding shares in Carboline Norge A/S, a Norwegian corporation. Of the remaining outstanding shares in Carboline Norge A/S, Carboline International Corporation owns 40% and 55% are held by a joint venture partner. | ||
DAP Products Inc. owns 94% of the outstanding shares in Portazul, S.A., a Dominican Republic corporation. The remaining 6% of the outstanding shares in Portazul, S.A. are held by the directors of Portazul, S.A. | ||
3 | DAP Holdings, LLC owns 100% of the outstanding Common Stock in DAP Brands Company, a Delaware corporation. RPM Canada Company owns 100% of the outstanding Series A Preferred Stock and Series B Preferred Stock in DAP Brands Company. | |
DAP Holdings, LLC owns 1.60% of the outstanding Common Stock in RPM Holdco Corp., a Delaware Corporation. The remaining outstanding Common Stock in RPM Holdco Corp. is held as follows: Carboline Company 2.93%, Day-Glo Color Corp. 7.33%, Dryvit Systems, Inc. 8.40%, The Euclid Chemical Company 1.27%, RPM Wood Finishes Group, Inc. 5.66%, Rust-Oleum International, LLC 15%, StonCor Group, Inc. 12.87%, Tremco Incorporated 44.67% and Zinsser Holdings, LLC .27%. |
3
DAP Holdings, LLC owns 23.81% of the outstanding Preferred Stock in RPM Holdco Corp., a Delaware Corporation. The remaining outstanding Preferred Stock is held as follows: Rust-Oleum International, LLC 51.54% and Zinsser Holdings, LLC 24.65%. | ||
RPM Holdco Corp. owns 100% of the outstanding shares in RPM Canada Company, a Canadian unlimited liability company. Subsidiaries of RPM Canada Company are listed under Tremco Incorporated footnote. | ||
4 | Rust-Oleum Corporation owns 95% of the outstanding shares of Rust-Oleum Argentina S.A. The remaining 5% of the outstanding shares of Rust-Oleum Argentina S.A. are held by Rust-Oleum International, LLC. | |
Rust-Oleum Corporation owns 100% of the outstanding Series E Preferred Stock (non-voting) in RPM Funding Corporation, a Delaware corporation. The remaining outstanding shares in RPM Funding Corporation are held as follows: 100% of the outstanding voting Common Stock by RPM International Inc.; 100% of the outstanding Series A Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series B Preferred Stock (non-voting) by DAP Products Inc.; 100% of the outstanding Series C Preferred Stock (non-voting) by The Euclid Chemical Company; 100% of the outstanding Series D Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series F Preferred Stock (non-voting) by The Testor Corporation; 100% of the outstanding Series G Preferred Stock (non-voting) by Tremco Incorporated; 100% of the outstanding Series H Preferred Stock (non-voting) by Weatherproofing Technologies, Inc.; 100% of the outstanding Series I Preferred Stock (non-voting) by Zinsser Co., Inc.; and 100% of the outstanding Series J Preferred Stock (non-voting) by Tremco Barrier Solutions, Inc. | ||
RPM Funding Corporation owns 5% of the outstanding shares in Carboline Norge A/S, a Norwegian corporation. Of the remaining outstanding shares in Carboline Norge A/S, Carboline International Corporation owns 40% and 55% are held by a joint venture partner. | ||
5 | Rust-Oleum International, LLC owns 5% of the outstanding shares of Rust-Oleum Argentina S.A. The remaining 95% of the outstanding shares of Rust-Oleum Argentina S.A. are held by Rust-Oleum Corporation. | |
Rust-Oleum International, LLC owns 100% of the outstanding Common Stock in Rust-Oleum Brands Company, a Delaware corporation. RPM Canada Company owns 100% of the outstanding Series A Preferred Stock and Series B Preferred Stock in Rust-Oleum Brands Company. | ||
Rust-Oleum International, LLC owns 15% of the outstanding Common Stock in RPM Holdco Corp., a Delaware Corporation. The remaining Common Stock in RPM Holdco Corp. is held as follows: Carboline Company 2.93%, DAP Holdings, LLC 1.60%, Day-Glo Color Corp. 7.33%, Dryvit Systems, Inc. 8.40%, The Euclid Chemical Company 1.27%, RPM Wood Finishes Group, Inc. 5.66%, StonCor Group, Inc. 12.87%, Tremco Incorporated 44.67% and Zinsser Holdings, LLC .27%. |
4
Rust-Oleum International, LLC owns 51.54% of the outstanding Preferred Stock in RPM Holdco Corp., a Delaware Corporation. The remaining outstanding Preferred Stock is held as follows: DAP Holdings, LLC 23.81% and Zinsser Holdings, LLC 24.65%. | ||
RPM Holdco Corp. owns 100% of the outstanding shares in RPM Canada Company, a Canadian unlimited liability company. Subsidiaries of RPM Canada Company are listed under Tremco Incorporated footnote. | ||
6 | The Flecto Company, Inc. owns 79% of the outstanding shares in Harry A. Crossland Investments, Ltd., a Nevada corporation. The remaining 21% of the outstanding shares in Harry A. Crossland Investments, Ltd. are held by RPM Canada Company. | |
Harry A. Crossland Investments, Ltd. owns 100% of the outstanding shares in Crossland Distributors Ltd., a Canadian corporation. | ||
7 | The Testor Corporation owns 100% of the outstanding Series F Preferred Stock (non-voting) in RPM Funding Corporation, a Delaware corporation. The remaining outstanding shares in RPM Funding Corporation are held as follows: 100% of the outstanding voting Common Stock by RPM International Inc.; 100% of the outstanding Series A Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series B Preferred Stock (non-voting) by DAP Products Inc.; 100% of the outstanding Series C Preferred Stock (non-voting) by The Euclid Chemical Company; 100% of the outstanding Series D Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series E Preferred Stock (non-voting) by Rust-Oleum Corporation; 100% of the outstanding Series G Preferred Stock (non-voting) by Tremco Incorporated; 100% of the outstanding Series H Preferred Stock (non-voting) by Weatherproofing Technologies, Inc.; 100% of the outstanding Series I Preferred Stock (non-voting) by Zinsser Co., Inc.; and 100% of the outstanding Series J Preferred Stock (non-voting) by Tremco Barrier Solutions, Inc. | |
RPM Funding Corporation owns 5% of the outstanding shares in Carboline Norge A/S, a Norwegian corporation. Of the remaining outstanding shares in Carboline Norge A/S, Carboline International Corporation owns 40% and 55% are held by a joint venture partner. | ||
8 | Zinsser Co., Inc. owns 100% of the outstanding Series I Preferred Stock (non-voting) in RPM Funding Corporation, a Delaware corporation. The remaining outstanding shares in RPM Funding Corporation are held as follows: 100% of the outstanding voting Common Stock by RPM International Inc.; 100% of the outstanding Series A Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series B Preferred Stock (non-voting) by DAP Products Inc.; 100% of the outstanding Series C Preferred Stock (non-voting) by The Euclid Chemical Company; 100% of the outstanding Series D Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series E Preferred Stock (non-voting) by Rust-Oleum Corporation; 100% of the outstanding Series F Preferred Stock (non-voting) by The Testor Corporation; 100% of the outstanding Series G Preferred Stock (non-voting) by Tremco Incorporated; 100% of the outstanding Series H Preferred Stock (non-voting) by Weatherproofing Technologies, Inc.; and 100% of the outstanding Series J Preferred Stock (non-voting) by Tremco Barrier Solutions, Inc. |
5
RPM Funding Corporation owns 5% of the outstanding shares in Carboline Norge A/S, a Norwegian corporation. Of the remaining outstanding shares in Carboline Norge A/S, Carboline International Corporation owns 40% and 55% are held by a joint venture partner. | ||
9 | Zinsser Holdings, LLC owns 100% of the outstanding Common Stock in Zinsser Brands Company, a Delaware corporation. RPM Canada Company owns 100% of the outstanding Series A Preferred Stock and Series B Preferred Stock in Zinsser Brands Company. | |
Zinsser Holdings, LLC owns .27% of the outstanding Common Stock in RPM Holdco Corp., a Delaware Corporation. The remaining outstanding Common Stock in RPM Holdco Corp. is held as follows: Carboline Company 2.93%, DAP Holdings, LLC 1.60%, Day-Glo Color Corp. 7.33%, Dryvit Systems, Inc. 8.40%, The Euclid Chemical Company 1.27%, RPM Wood Finishes Group, Inc. 5.66%, Rust-Oleum International, LLC 15%, StonCor Group, Inc. 12.87% and Tremco Incorporated 44.67%. | ||
Zinsser Holdings, LLC owns 24.65% of the outstanding Preferred Stock in RPM Holdco Corp., a Delaware Corporation. The remaining outstanding Preferred Stock is held as follows: DAP Holdings, LLC 23.81% and Rust-Oleum International, LLC 51.54% | ||
RPM Holdco Corp. owns 100% of the outstanding shares in RPM Canada Company, a Canadian unlimited liability company. Subsidiaries of RPM Canada Company are listed under Tremco Incorporated footnote. | ||
10 | RPM, Inc. owns 88% of the outstanding shares in RPM/Lux Consult S.A., a Luxembourg corporation. The remaining 12% of the outstanding shares in RPM/Lux Consult S.A. are held by Tremco Incorporated. | |
RPM/Lux Consult S.A. owns .20% of the outstanding shares in Monile France S.àr.l., a French corporation. The remaining 99.80% of the outstanding shares in Monile France S.àr.l. are held by RPM/Belgium N.V. | ||
RPM/Lux Consult S.A. owns .96% of the outstanding shares in RPM Europe S.A., a Belgian corporation. The remaining 99.04% of the outstanding shares in RPM Europe S.A. are held by RPM Europe Holdco B.V. | ||
11 | Day-Glo Color Corp. owns 7.33% of the outstanding shares in RPM Holdco Corp., a Delaware Corporation. The remaining outstanding shares of RPM Holdco Corp. are held as follows: Carboline Company 2.93%, DAP Holdings, LLC 1.60%, Dryvit Systems, Inc. 8.40%, The Euclid Chemical Company 1.27%, RPM Wood Finishes Group, Inc. 5.66%, Rust-Oleum International, LLC 15%, StonCor Group, Inc. 12.87%, Tremco Incorporated 44.67% and Zinsser Holdings, LLC .27%. | |
RPM Holdco Corp. owns 100% of the outstanding shares in RPM Canada Company, a Canadian unlimited liability company. Subsidiaries of RPM Canada Company are listed under Tremco Incorporated footnote. |
6
Day-Glo Color Corp. owns .32% of the outstanding shares in Radiant Color N.V., a Belgian corporation. The remaining 99.68% of the outstanding shares in Radiant Color N.V. are held by RPM Europe Holdco B.V. | ||
Radiant Color N.V. owns 99.99% of the outstanding shares in Martin Mathys N.V., a Belgian corporation. The remaining .01% of the outstanding shares in Martin Mathys N.V. are held by RPM/Belgium N.V. | ||
Radiant Color N.V. owns 85.71% of the outstanding shares in Carboline Italia S.p.A., an Italian corporation. Of the remaining outstanding shares in Carboline Italia S.p.A., 13.57% are held by RPOW France S.A.S. and .72% are held by RPM Europe Holdco B.V. | ||
Radiant Color N.V. owns 67.86% of the outstanding shares in Ecoloc N.V., a Belgian corporation. The remaining 32.14% of the outstanding shares in Ecoloc N.V. are held by Lock-Tile Belgium N.V. | ||
Radiant Color N.V. owns 99.96% of the outstanding shares in Lock-Tile Belgium N.V., a Belgian corporation. The remaining .04% of the outstanding shares in Lock-Tile Belgium N.V. are held by RPM/Belgium N.V. | ||
12 | Dryvit Systems, Inc. owns 8.40% of the outstanding shares in RPM Holdco Corp., a Delaware corporation. The remaining outstanding shares in RPM Holdco Corp. are held as follows: Carboline Company 2.93%, DAP Holdings, LLC 1.60%, Day-Glo Color Corp. 7.33%, The Euclid Chemical Company 1.27%, RPM Wood Finishes Group, Inc. 5.66%, Rust-Oleum International, LLC 15%, StonCor Group, Inc. 12.87%, Tremco Incorporated 44.67% and Zinsser Holdings, LLC .27%. | |
RPM Holdco Corp. owns 100% of the outstanding shares in RPM Canada Company, a Canadian unlimited liability company. Subsidiaries of RPM Canada Company are listed under Tremco Incorporated footnote. | ||
Dryvit Systems, Inc. owns 88% of the outstanding shares in Beijing Dryvit Chemical Building Materials Co., Ltd., a Peoples Republic of China company. The remaining outstanding shares of Beijing Dryvit Chemical Building Materials Co., Ltd. are held by a joint venture partner. | ||
Dryvit Systems, Inc. owns 27.03% in AWCI Insurance Company, Ltd., a Bermuda exempt company. The remaining outstanding shares in AWCI Insurance Company, Ltd. are held by other EIFS manufacturers. | ||
13 | RPM Wood Finishes Group, Inc. owns 5.66% of the outstanding shares in RPM Holdco Corp., a Delaware corporation. The remaining outstanding shares in RPM Holdco Corp. are held as follows: Carboline Company 2.93%, DAP Holdings, LLC 1.60%, Day-Glo Color Corp. 7.33%, Dryvit Systems, Inc. 8.40%, The Euclid Chemical Company 1.27%, Rust-Oleum International, LLC 15%, StonCor Group, Inc. 12.87%, Tremco Incorporated 44.67% and Zinsser Holdings, LLC .27%. |
7
RPM Holdco Corp. owns 100% of the outstanding shares in RPM Canada Company, a Canadian unlimited liability company. Subsidiaries of RPM Canada Company are listed under Tremco Incorporated footnote. | ||
14 | Carboline Company owns 2.93% of the outstanding shares in RPM Holdco Corp., a Delaware Corporation. The remaining outstanding shares in RPM Holdco Corp. are held as follows: DAP Holdings, LLC 1.60%, Day-Glo Color Corp. 7.33%, Dryvit Systems, Inc. 8.40%, The Euclid Chemical Company 1.27%, RPM Wood Finishes Group, Inc. 5.66%, Rust-Oleum International, LLC 15%, StonCor Group, Inc. 12.87%, Tremco Incorporated 44.67% and Zinsser Holdings, LLC .27%. | |
RPM Holdco Corp. owns 100% of the outstanding shares in RPM Canada Company, a Canadian unlimited liability company. Subsidiaries of RPM Canada Company are listed under Tremco Incorporated footnote. | ||
15 | Carboline International Corporation owns 49% of the outstanding shares in Carboline Korea Ltd.; 40% in Carboline Norge A/S; 49% in StonCor Middle East LLC; 33.33% in Japan Carboline Company Ltd.; and 40% in CDC Carboline (India) Ltd. All outstanding shares of these entities are held by joint venture partners. However, 5% of the outstanding shares in Carboline Norge A/S are held by RPM Funding Corporation. | |
16 | Republic Powdered Metals, Inc. owns 100% of the outstanding Series A & D Preferred Stock (non-voting) in RPM Funding Corporation, a Delaware corporation. The remaining outstanding shares in RPM Funding Corporation are held as follows: 100% of the outstanding voting Common Stock by RPM International Inc.; 100% of the outstanding Series B Preferred Stock (non-voting) by DAP Products Inc.; 100% of the outstanding Series C Preferred Stock (non-voting) by The Euclid Chemical Company; 100% of the outstanding Series E Preferred Stock (non-voting) by Rust-Oleum Corporation; 100% of the outstanding Series F Preferred Stock (non-voting) by The Testor Corporation; 100% of the outstanding Series G Preferred Stock (non-voting) by Tremco Incorporated; 100% of the outstanding Series H Preferred Stock (non-voting) by Weatherproofing Technologies, Inc.; 100% of the outstanding Series I Preferred Stock (non-voting) by Zinsser Co., Inc.; and 100% of the outstanding Series J Preferred Stock (non-voting) by Tremco Barrier Solutions, Inc. | |
RPM Funding Corporation owns 5% of the outstanding shares in Carboline Norge A/S, a Norwegian corporation. Of the remaining outstanding shares in Carboline Norge A/S, Carboline International Corporation owns 40% and 55% are held by a joint venture partner. | ||
17 | StonCor Group, Inc. owns 12.87% of the outstanding shares in RPM Holdco Corp., a Delaware corporation. The remaining outstanding shares in RPM Holdco Corp. are held as follows: Carboline Company 2.93%, DAP Holdings, LLC 1.60%, Day-Glo Color Corp. 7.33%, Dryvit Systems, Inc. 8.40%, The Euclid Chemical Company 1.27%, RPM Wood Finishes Group, Inc. 5.66%, Rust-Oleum International, LLC 15%, Tremco Incorporated 44.67% and Zinsser Holdings, LLC .27%. |
8
RPM Holdco Corp. owns 100% of the outstanding shares in RPM Canada Company, a Canadian unlimited liability company. Subsidiaries of RPM Canada Company are listed under Tremco Incorporated footnote. | ||
StonCor Group, Inc. owns 95% of the outstanding shares in StonCor South Cone S.A., an Argentine corporation. The remaining 5% of the outstanding shares in StonCor South Cone S.A. are held by Parklin Management Group, Inc. | ||
StonCor Group, Inc. owns 99% of the outstanding shares in Stonhard S.A., a Luxembourg corporation. The remaining 1% of the outstanding shares in Stonhard S.A. are held by Parklin Management Group, Inc. | ||
StonCor Group, Inc. owns 99.55% of the outstanding shares in Grupo StonCor, S.A. de C.V., a Mexican corporation. The remaining .45% of the outstanding shares in Grupo StonCor, S.A. de C.V. are held by Parklin Management Group, Inc. | ||
Grupo StonCor, S.A. de C.V. owns 100% of the outstanding shares in Plasite, S.A. de C.V. Mexico, a Mexican corporation and 100% of the outstanding shares in Grupo StonCor, S.A. de C.V., a Colombian corporation. | ||
Grupo StonCor, S.A. de C.V. owns .1% of the outstanding shares in Corgrate Fiberglass Systems S.A. de C.V., a Mexican corporation The remaining 99.9% of the outstanding shares in Corgrate Fiberglass Systems S.A. de C.V. are held by Fibergrate Composite Structures Incorporated. | ||
StonCor Group, Inc. owns 99.67% of the outstanding shares in Stonhard de Mexico, S.A. de C.V., a Mexican corporation. The remaining .33% of the outstanding shares are held by Parklin Management Group, Inc. | ||
Stonhard de Mexico, S.A. de C.V. owns 99.59% of the outstanding shares in Juárez Inmobiliaria, S.A., a Mexican corporation. Of the remaining .41% outstanding shares in Juárez Inmobiliaria, S.A., .33% are held by Grupo StonCor, S.A. de C.V. and .08% are held by StonCor Group,Inc. | ||
StonCor Group, Inc. owns .01% of the outstanding shares in StonCor Services, Ltda., a Brazilian corporation. The remaining 99.99% of the outstanding shares in StonCor Services, Ltda. are held by StonCor Corrosion Specialists Group Ltda. | ||
18 | Fibergrate Composite Structures Incorporated owns 99.9% of the outstanding shares in Corgrate Fiberglass Systems S.A. de C.V., a Mexican corporation. The remaining .1% of the outstanding shares in Corgrate Fiberglass Systems S.A. de C.V. are held by Grupo StonCor, S.A. de C.V. | |
19 | Parklin Management Group, Inc. owns .875% of the outstanding shares in StonCor (Deutschland) GmbH, a German corporation. Of the remaining 99.125% outstanding shares in StonCor (Deutshland) GmbH, 98.25% are held by RPM Canada, a General Partnership and .875% are held by RPM Canada Company. |
9
StonCor (Deutschland) GmbH owns 100% of the outstanding shares in Alteco Technik GmbH, a German corporation. | ||
Parklin Management Group, Inc. owns .45% of the outstanding shares in Grupo StonCor, S.A. de C.V., a Mexican corporation. The remaining 99.55% of the outstanding shares in Grupo StonCor, S.A. de C.V. are held by StonCor Group, Inc. | ||
Parklin Management Group, Inc. owns .33% of the outstanding shares in Stonhard de Mexico, S.A. de C.V., a Mexican corporation. The remaining 99.67% of the outstanding shares in Stonhard de Mexico, S.A. de C.V. are held by StonCor Group, Inc. | ||
Parklin Management Group, Inc. owns 1% of the outstanding shares in Stonhard S.A., a Luxembourg corporation. The remaining 99% of the outstanding shares in Stonhard S.A. are held by StonCor Group, Inc. | ||
Parklin Management Group, Inc. owns 5% of the outstanding shares in StonCor South Cone S.A., an Argentine corporation. The remaining 95% of the outstanding shares in StonCor South cone S.A. are held by StonCor Group, Inc. | ||
20 | StonCor Corrosion Specialists Group Ltda. owns 99.99% of the outstanding shares in StonCor Services, Ltda., a Brazilian corporation. The remaining .01% of the outstanding shares in StonCor Services, Ltda. are held by StonCor Group, Inc. | |
21 | Tremco Incorporated owns 100% of the outstanding Series G Preferred Stock (non-voting) in RPM Funding Corporation, a Delaware corporation. The remaining outstanding shares in RPM Funding Corporation are held as follows: 100% of the outstanding voting Common Stock by RPM International Inc.; 100% of the outstanding Series A Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series B Preferred Stock (non-voting) by DAP Products Inc.; 100% of the outstanding Series C Preferred Stock (non-voting) by The Euclid Chemical Company; 100% of the outstanding Series D Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series E Preferred Stock (non-voting) by Rust-Oleum Corporation; 100% of the outstanding Series F Preferred Stock (non-voting) by The Testor Corporation; 100% of the outstanding Series H Preferred Stock (non-voting) by Weatherproofing Technologies, Inc.; 100% of the outstanding Series I Preferred Stock (non-voting) by Zinsser Co., Inc.; and 100% of the outstanding Series J Preferred Stock (non-voting) by Tremco Barrier Solutions, Inc. | |
RPM Funding Corporation owns 5% of the outstanding shares in Carboline Norge A/S, a Norwegian corporation. Of the remaining outstanding shares in Carboline Norge A/S, Carboline International Corporation owns 40% and 55% are held by a joint venture partner. | ||
Tremco Incorporated owns 44.67% of the outstanding shares in RPM Holdco Corp., a Delaware corporation. The remaining outstanding shares in RPM Holdco Corp. are held as follows: Carboline Company 2.93%, DAP Holdings, LLC 1.60%, Day-Glo Color Corp. 7.33%, Dryvit Systems, Inc. 8.40%, The Euclid Chemical Company 1.27%, RPM Wood Finishes Group, Inc. |
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5.66%, Rust-Oleum International, LLC 15%, StonCor Group, Inc. 12.87%, and Zinsser Holdings, LLC .27%. | ||
RPM Holdco Corp. owns 100% of the outstanding shares in RPM Canada Company, a Canadian unlimited liability company. | ||
RPM Canada Company owns 100% of the outstanding Series A Preferred Stock and Series B Preferred Stock in DAP Brands Company, a Delaware corporation. DAP Holdings, LLC owns 100% of the outstanding Common Stock in DAP Brands Company. | ||
RPM Canada Company owns 100% of the outstanding Series A Preferred Stock and Series B Preferred Stock in Rust-Oleum Brands Company, a Delaware corporation. Rust-Oleum International, LLC owns 100% of the outstanding Common Stock in Rust-Oleum Brands Company. | ||
RPM Canada Company owns 100% of the outstanding Series A Preferred Stock and Series B Preferred Stock in Zinsser Brands Company, a Delaware corporation. Zinsser Holdings, LLC owns 100% of the outstanding Common Stock in Zinsser Brands Company. | ||
RPM Canada Company owns 100% of the outstanding shares in RPM Canada Investment Company, a Canadian unlimited liability company. | ||
RPM Canada Investment Company owns 100% of the outstanding shares in Permaquik Corporation, a Canadian Corporation. | ||
RPM Canada Company is a 73.77% partner in RPM Canada, a General Partnership, an Ontario partnership. RPM Canada Investment Company is a 26.23% partner in RPM Canada, a General Partnership. | ||
RPM Canada Company owns 21% of the outstanding shares in Harry A. Crossland Investments, Ltd., a Nevada corporation. The remaining 79% of the outstanding shares in Harry A. Crossland Investments, Ltd. are held by The Flecto Company, Inc. | ||
Harry A. Crossland Investments, Ltd. owns 100% of the outstanding shares in Crossland Distributors Ltd., a Canadian corporation. | ||
RPM Canada, a General Partnership owns 100% of the outstanding shares in Euclid Admixture Canada Inc., a Canadian corporation. | ||
RPM Canada, a General Partnership owns 100% of the outstanding shares in A/D Fire Protection Systems Inc., a Canadian corporation. | ||
A/D Fire Protection Systems Inc. owns 50% of the outstanding shares in the following Canadian corporations: Donalco Inc., Donalco Western Inc. and 2926253 Canada Ltd./Ltee. (dba Pro Firestop). The remaining 50% of the outstanding shares are held by non-RPM shareholders. |
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RPM Canada, a General Partnership owns 99% of the outstanding partnership interest in RPM United Kingdom G.P., a non-registered United Kingdom partnership. The remaining 1% of the outstanding partnership interest in RPM United Kingdom G.P. is held by RPM Canada Investment Company. | ||
RPM United Kingdom G.P. owns 12% of the outstanding shares in RPM Europe Holdco B.V.. a Netherlands corporation. Of the remaining outstanding shares, RPM Canada Company owns 79% and RPM Canada, a General Partnership owns 9%. | ||
RPM United Kingdom G.P. is the sole member of RPM Europe Coöperatief U.A., a Dutch cooperative with excluded liability. | ||
RPM United Kingdom G.P. owns 100% of the outstanding shares in RPM Nova Scotia ULC, a Canadian Corporation. | ||
RPM Europe Coöperatief U.A. owns 100% of the outstanding shares in RPM Germany GmbH, a German corporation and RPM Lux Holdco S.àr.l., a Luxembourg corporation. | ||
RPM Lux Holdco S.àr.l. owns 100% of the outstanding shares in RPM Ireland IP Limited, an Irish corporation. | ||
RPM Germany GmbH owns 100% of the outstanding shares in Compact Technology GmbH and Tremco illbruck International GmbH, both German Corporations. | ||
Tremco illbruck International GmbH owns 100% of the outstanding shares in Tremco illbruck Produktion GmbH, a German Corporation; Tremco illbruck GmbH, an Austrian corporation; Tremco illbruck s.r.o., a Czech Republic corporation; Tremco illbruck Sp. zo.o., a Polish corporation; and illbruck Joints et Systèmes S.A.S., a French corporation. | ||
Tremco illbruck Produktion GmbH is a general partner and Tremco illbruck International GmbH is a limited partner in Tremco illbruck GmbH & Co. KG, a German limited partnership. | ||
Tremco illbruck International GmbH owns 99.75% of the outstanding shares in illbruck Sealant Systems N.V., a Belgian corporation. The remaining .25% of the outstanding shares in illbruck Sealant Systems N.V. are held RPM Germany GmbH, a German corporation. | ||
illbruck Sealant Systems N.V. owns 100% of the outstanding shares in Colcon N.V., a Belgian corporation. | ||
Colcon N.V. owns 100% of the outstanding shares in Colymit N.V. a Belgian corporation. | ||
Colymit N.V. owns 100% of the outstanding shares in Caseko Sealants B.V., a Netherlands corporation. | ||
RPM Canada, a General Partnership owns 100% of the outstanding shares in Tremco illbruck Production Limited, a United Kingdom corporation. |
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Tremco illbruck Production Limited owns 100% of the outstanding shares in Tremco illbruck OY, a Finnish corporation and 100% of the outstanding shares in Tremco illbruck Limited, illbruck Sealant Systems UK Limited, Tretol Group Limited and Tor Coatings Limited, all UK corporations. | ||
Tremco illbruck OY owns 100% of the outstanding shares in Tremco illbruck ooo, a Russian corporation. | ||
Tretol Group Limited owns 100% of the outstanding shares in Tretol Limited and Tretobond Limited, both United Kingdom corporations. | ||
Tor Coatings Limited owns 100% of the outstanding shares in Ardenbrite Products Limited, Crossco (261) Limited, Crossco (754) Limited, Deancove Limited, Duratec Coatings Consultants Limited, Holdtite Adhesives Limited, Oakdyke Limited and Sandco 953 Limited, all UK corporations. | ||
RPM Canada Company owns 79% of the outstanding shares in RPM Europe Holdco B.V., a Netherlands corporation. Of the remaining 21% of the outstanding shares in RPM Europe Holdco B.V., 9% of the outstanding shares are held by RPM Canada, a General Partnership and 12% are held by RPM United Kingdom G.P. | ||
RPM Europe Holdco B.V. owns .20% of the outstanding shares in illbruck Sealant Systems Production S.A. The remaining 99.80% of the outstanding shares in illbruck Sealant Systems Production S.A. are held by Tremco illbruck Productie B.V. | ||
RPM Europe Holdco B.V. owns 100% of the outstanding shares in Vandex Holding AG, a Swiss corporation. | ||
Vandex Holding AG owns 100% of the outstanding shares in Vandex Isoliermittel-Gesellschaft mbH, a German corporation; Vandex UK Limited, a United Kingdom corporation; Vandex International AG and Vandex AG, both Swiss corporations; and 49% of the outstanding shares in Vandex (USA) LLC, a Pennsylvania corporation. The remaining outstanding shares in Vandex (USA) LLC are held by a joint venture partner. | ||
RPM Europe Holdco B.V. owns 100% of the outstanding shares in Tremco illbruck Productie B.V., Rust-Oleum Netherlands B.V., StonCor Benelux B.V., and Tremco illbruck B.V., all Netherlands corporations, and RPOW U.K. Limited, a United Kingdom corporation. | ||
Tremco illbruck Productie B.V. owns 9.214% of the outstanding shares in PDR GmbH and 8.32% of the outstanding shares in PDR Recycling GmbH & Co. KG, both German corporations. The remaining outstanding shares are held by joint venture partners. | ||
Tremco illbruck Productie B.V. owns 100% of the outstanding shares in Arkelveste B.V., a Netherlands corporation. |
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Tremco illbruck Productie B.V. owns 99.80% of the outstanding shares in illbruck Sealant Systems Production S.A., a Belgian corporation. The remaining .20% of the outstanding shares in illbruck Sealant Systems Production S.A. are held by RPM Europe Holdco B.V. | ||
illbruck Sealant Systems Production S.A. owns 100% of the outstanding shares in Eurobond S.A., a Belgian corporation. | ||
RPM Europe Holdco B.V. owns 96.04% of the outstanding shares in RPM/Belgium N.V., a Belgian corporation. The remaining 3.96% of the outstanding shares in RPM/Belgium N.V. are held by Tremco Incorporated. | ||
RPM Europe Holdco B.V. owns 99.68% of the outstanding shares in Radiant Color N.V., a Belgian corporation. The remaining .32% of the outstanding shares in Radiant Color N.V. are held by Day-Glo Color Corp. | ||
Radiant Color N.V. owns 99.99% of the outstanding shares in Martin Mathys N.V., a Belgian corporation. The remaining .01% of the outstanding shares in Martin Mathys N.V. are held by RPM/Belgium N.V. | ||
Radiant Color N.V. owns 85.71% of the outstanding shares in Carboline Italia S.p.A., an Italian corporation. Of the remaining outstanding shares in Carboline Italia S.p.A., 13.57% are held by RPOW France S.A.S. and .72% are held by RPM Europe Holdco B.V. | ||
Radiant Color N.V. owns 67.86% of the outstanding shares in Ecoloc N.V., a Belgian corporation. The remaining 32.14% of the outstanding shares in Ecoloc N.V. are held by Lock-Tile Belgium N.V. | ||
Radiant Color N.V. owns 99.96% of the outstanding shares in Lock-Tile Belgium N.V., a Belgian corporation. The remaining .04% of the outstanding shares in Lock-Tile Belgium N.V. are held by RPM/Belgium N.V. | ||
RPM/Belgium N.V. owns 99.80% of the outstanding shares in Monile France S.àr.l., a French corporation. The remaining .20% of the outstanding shares in Monile France S.àr.l. are held by RPM/Lux Consult S.A. | ||
RPM/Belgium N.V. owns 100% of the outstanding shares in Alteco Chemical-Produtos Quimicos SA, a Portuguese corporation. | ||
RPM Europe Holdco B.V. owns 99% of the outstanding shares in Zinsser Europe N.V., a Belgian corporation. The remaining 1% of the outstanding shares in Zinsser Europe N.V. are held by RPM/Belgium N.V. | ||
RPM Europe Holdco B.V. owns 100% of the outstanding shares in RPOW France S.A.S., a French corporation. |
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RPM Europe Holdco B.V. owns .72% of the outstanding shares in Carboline Italia S.p.A., an Italian corporation. Of the remaining outstanding shares in Carboline Italia S.p.A., 85.71% are held by Radiant Color N.V. and 13.57% are held by RPOW France S.A.S. | ||
RPM Europe Holdco B.V. owns 99.04% of the outstanding shares in RPM Europe S.A., a Belgian corporation. The remaining .96% of the outstanding shares in RPM Europe S.A. are held by RPM/Lux Consult S.A. | ||
RPOW France S.A.S. owns 13.57% of the outstanding shares in Carboline Italia S.p.A., an Italian corporation. Of the remaining outstanding shares in Carboline Italia S.p.A., 85.71% are held by Radiant Color N.V. and .72% are held by RPM Europe Holdco B.V. | ||
RPOW France S.A.S. owns 100% of the outstanding shares in Carboline France S.A.S., a French corporation. | ||
RPOW France S.A.S. owns 100% of the outstanding shares in Rust-Oleum France S.A.S., a French corporation and Rust-Oleum Mathys Italia S.r.l., an Italian corporation. | ||
RPOW France S.A.S. owns 99.99% of the outstanding shares in Stonhard S.A.S., a French corporation. The remaining .01% of the outstanding shares are held by Rust-Oleum France S.A.S. | ||
Stonhard S.A.S. owns 100% of the outstanding shares in StonCor España SL, a Spanish corporation. | ||
RPOW U.K. Limited owns 100% of the outstanding shares in each of the following United Kingdom corporations: Advanced Construction Materials Limited, Anglo Building Products Limited, Bondo U.K. Limited, Chemspec Europe Limited, Dane Color UK Limited, Dryvit U.K. Limited, Fibergrate Composite Structures Limited, illbruck Holdings Limited, Mantrose U.K. Limited, RPM Holdings UK Limited, Rust-Oleum U.K. Limited, Stonhard U.K. Limited, Timberex International Limited, Watco International Limited and Watco UK Limited. | ||
illbruck Holdings Limited owns 100% of the outstanding shares in Alfas Group Limited, a United Kingdom corporation. | ||
Mantrose U.K. Limited owns 100% of the outstanding shares in Agricoat Industries Limited and Wm. Zinsser Limited, both United Kingdom corporations. | ||
Watco UK Limited owns 100% of the outstanding shares in the following United Kingdom corporations: Industrial Flooring Services Limited, Watco Group Manufacturing Limited and Watco Limited, as well as 100% of the outstanding shares of Watco GmbH, a German corporation and Watco S.àr.l., a French corporation. | ||
RPM Holdings UK Limited owns 100% of the outstanding shares in Dore Holdings Limited, a United Kingdom corporation. |
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Dore Holdings Limited owns 100% of the outstanding shares in each of Amtred Limited and Nullifire Limited, both United Kingdom corporations. | ||
RPM Canada, a General Partnership, owns 98.25% of the outstanding shares in StonCor (Deutschland) GmbH, a German corporation. The remaining 1.75% of the outstanding shares in StonCor (Deutschland) GmbH are split equally between RPM Canada Company and Parklin Management Group, Inc., each holding .875% of the remaining outstanding shares. | ||
RPM Canada, a General Partnership, owns 100% of Permaquik (UK) Limited, a United Kingdom corporation. | ||
RPM Canada, a General Partnership, owns 77% of the outstanding shares in Permaquik Western Ltd., a Canadian corporation. The remaining 23% of the outstanding shares in Permaquik Western Ltd. are held by a joint venture partner. | ||
Permaquik Western Ltd. owns 66% of the outstanding ownership interest in Permaquik (Shanghai) Waterproofing Materials Co. Ltd., a Peoples Republic of China corporation. The remaining 34% of the outstanding shares in Permaquik Western Ltd. are held by a joint venture partner. | ||
StonCor (Deutschland) GmbH owns 100% of the outstanding shares in Alteco Technik GmbH, a German corporation. | ||
Tremco Incorporated owns 3.96% of the outstanding shares in RPM/Belgium N.V., a Belgian corporation. The remaining 96.04% of the outstanding shares in RPM/Belgium N.V. are held by RPM Europe Holdco B.V. | ||
RPM/Belgium N.V. owns 100% of the outstanding shares in Alteco Chemical-Produtos Quimicos SA, a Portuguese corporation. | ||
RPM/Belgium N.V. owns .01% of the outstanding shares in Martin Mathys N.V., a Belgian corporation. The remaining 99.99% of the outstanding shares in Martin Mathys N.V. are held by Radiant Color N.V. | ||
RPM/Belgium N.V. owns 1% of the outstanding shares in Zinsser Europe N.V., a Belgian corporation. The remaining 99% of the outstanding shares in Zinsser Europe N.V. are held by RPM Europe Holdco B.V. | ||
RPM/Belgium N.V. owns .04% of the outstanding shares in Lock-Tile Belgium N.V., a Belgian corporation. The remaining 99.96% of the outstanding shares in Lock-Tile Belgium N.V. are held by Radiant Color N.V. | ||
Lock-Tile Belgium N.V. owns 32.14% of the outstanding shares in Ecoloc N.V. The remaining 67.86% of the outstanding shares in Ecoloc N.V. are held by Radiant Color N.V. | ||
Tremco Incorporated owns .0025% of the outstanding shares in Toxement S.A., a Colombian corporation. Of the remaining outstanding shares in Toxement S.A., Grandcourt N.V. owns |
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50.99%, The Euclid Chemical Company owns 49% and Euclid Chemical International Sales Corp, Redwood Transport, Inc. and Weatherproofing Technologies, Inc. each own .0025%. | ||
Tremco Incorporated owns 49% of the outstanding shares in Sime Tremco Sdn. Bhd., a Malaysian corporation. The remaining outstanding shares in Sime Tremco Sdn. Bhd. are held by a joint venture partner. | ||
Sime Tremco Sdn. Bhd. Owns 100% of the outstanding shares in Sime Tremco Specialty Chemicals Sdn. Bhd., a Malaysian corporation. | ||
Tremco Incorporated owns 99.999% of the outstanding shares in Tremco Far East Limited, a Hong Kong corporation. The remaining .001% of the outstanding shares in Tremco Far East Limited are held by a director of Tremco Far East Limited. | ||
Tremco Far East Limited owns 100% of the outstanding shares in Tremco (Malaysia) Sdn. Bhd., a Malaysian corporation and 100% of the outstanding shares in Shanghai Tremco International Trading Co., Ltd., a Chinese corporation. | ||
Tremco Incorporated owns 12% of the outstanding shares in RPM/Lux Consult S.A., a Luxembourg corporation. The remaining 88% of the outstanding shares in RPM/Lux Consult S.A. are held by RPM, Inc. | ||
RPM/Lux Consult S.A. owns .20% of the outstanding shares in Monile France S.àr.l., a French corporation. The remaining 99.80% of the outstanding shares in Monile France S.àr.l. are held by RPM/Belgium N.V. | ||
RPM/Lux Consult S.A. owns .96% of the outstanding shares in RPM Europe S.A., a Belgian corporation. The remaining 99.04% of the outstanding shares in RPM Europe S.A. are held by RPM Europe Holdco B.V. | ||
22 | The Euclid Chemical Company owns 60% interest in Euco Densit LLC, an Ohio limited liability company. The remaining 40% interest in Euco Densit LLC is held by a joint venture partner. | |
The Euclid Chemical Company owns 100% of the outstanding Series C Preferred Stock (non-voting) in RPM Funding Corporation, a Delaware corporation. The remaining outstanding shares in RPM Funding Corporation are held as follows: 100% of the outstanding voting Common Stock by RPM International Inc.; 100% of the outstanding Series A Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series B Preferred Stock (non-voting) by DAP Products Inc.; 100% of the outstanding Series D Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series E Preferred Stock (non-voting) by Rust-Oleum Corporation; 100% of the outstanding Series F Preferred Stock (non-voting) by The Testor Corporation; 100% of the outstanding Series G Preferred Stock (non-voting) by Tremco Incorporated; 100% of the outstanding Series H Preferred Stock (non-voting) by Weatherproofing Technologies, Inc.; 100% of the outstanding Series I Preferred Stock (non- |
17
voting) by Zinsser Co., Inc.; and 100% of the outstanding Series J Preferred Stock (non-voting) by Tremco Barrier Solutions, Inc. | ||
RPM Funding Corporation owns 5% of the outstanding shares in Carboline Norge A/S, a Norwegian corporation. Of the remaining outstanding shares in Carboline Norge A/S, Carboline International Corporation owns 40% and 55% are held by a joint venture partner. | ||
The Euclid Chemical Company owns 1.27% of the outstanding shares in RPM Holdco Corp., a Delaware corporation. The remaining outstanding shares in RPM Holdco Corp. are held as follows: Carboline Company 2.93%, DAP Holdings, LLC 1.60%, Day-Glo Color Corp. 7.33%, Dryvit Systems, Inc. 8.40%, RPM Wood Finishes Group, Inc. 5.66%, Rust-Oleum International, LLC 15%, StonCor Group, Inc. 12.87%, Tremco Incorporated 44.67% and Zinsser Holdings, LLC .27%. | ||
RPM Holdco Corp. owns 100% of the outstanding shares in RPM Canada Company, a Canadian unlimited liability company. Subsidiaries of RPM Canada Company are listed under Tremco Incorporated footnote. | ||
The Euclid Chemical Company owns 99.997% of the outstanding shares in Eucomex S.A. de C.V., a Mexican corporation. The remaining .003% of the outstanding shares in Eucomex S.A. de C.V. are held by Redwood Transport, Inc. | ||
The Euclid Chemical Company owns 49% of the outstanding shares in Toxement S.A., a Colombian corporation. Of the remaining outstanding shares in Toxement S.A., Grandcourt N.V. owns 50.99% and Euclid Chemical International Sales Corp., Redwood Transport, Inc., Tremco Incorporated and Weatherproofing Technologies, Inc. each own .0025%. | ||
23 | Euclid Chemical International Sales Corp. owns .0025% of the outstanding shares in Toxement S.A., a Colombian corporation. Of the remaining outstanding shares in Toxement S.A., Grandcourt N.V. owns 50.99%, The Euclid Chemical Company owns 49% and Redwood Transport, Inc., Tremco Incorporated and Weatherproofing Technologies, Inc. each own .0025%. | |
24 | Grandcourt N.V. owns 50.99% of the outstanding shares in Toxement S.A., a Colombian corporation. Of the remaining outstanding shares in Toxement S.A., The Euclid Chemical Company owns 49% and Euclid Chemical International Sales Corp., Redwood Transport, Inc., Tremco Incorporated and Weatherproofing Technologies, Inc. each own .0025%. | |
25 | Redwood Transport, Inc. owns .003% of the outstanding shares in Eucomex S.A. de C.V., a Mexican corporation. The remaining 99.997% of the outstanding shares in Eucomex S.A. de C.V. are held by The Euclid Chemical Company. | |
Redwood Transport, Inc. owns .0025% of the outstanding shares in Toxement S.A., a Colombian corporation. Of the remaining outstanding shares in Toxement S.A., Grandcourt N.V. owns 50.99%, The Euclid Chemical Company owns 49% and Euclid Chemical International Sales Corp., Tremco Incorporated and Weatherproofing Technologies, Inc. each own .0025%. |
18
26 | Tremco Barrier Solutions, Inc. owns 100% of the outstanding Series J Preferred Stock (non-voting) in RPM Funding Corporation, a Delaware corporation. The remaining outstanding shares in RPM Funding Corporation are held as follows: 100% of the outstanding voting Common Stock by RPM International Inc.; 100% of the outstanding Series A Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series B Preferred Stock (non-voting) by DAP Products Inc.; 100% of the outstanding Series C Preferred Stock (non-voting) by The Euclid Chemical Company; 100% of the outstanding Series D Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series E Preferred Stock (non-voting) by Rust-Oleum Corporation; 100% of the outstanding Series F Preferred Stock (non-voting) by The Testor Corporation; 100% of the outstanding Series G Preferred Stock (non-voting) by Tremco Incorporated; 100% of the outstanding Series I Preferred Stock (non-voting) by Zinsser Co., Inc.; and 100% of the outstanding Series H Preferred Stock (non-voting) by Weatherproofing Technologies, Inc. | |
RPM Funding Corporation owns 5% of the outstanding shares in Carboline Norge A/S, a Norwegian corporation. Of the remaining outstanding shares in Carboline Norge A/S, Carboline International Corporation owns 40% and 55% are held by a joint venture partner. | ||
27 | Weatherproofing Technologies, Inc. owns 100% of the outstanding Series H Preferred Stock (non-voting) in RPM Funding Corporation, a Delaware corporation. The remaining outstanding shares in RPM Funding Corporation are held as follows: 100% of the outstanding voting Common Stock by RPM International Inc.; 100% of the outstanding Series A Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series B Preferred Stock (non-voting) by DAP Products Inc.; 100% of the outstanding Series C Preferred Stock (non-voting) by The Euclid Chemical Company; 100% of the outstanding Series D Preferred Stock (non-voting) by Republic Powdered Metals, Inc.; 100% of the outstanding Series E Preferred Stock (non-voting) by Rust-Oleum Corporation; 100% of the outstanding Series F Preferred Stock (non-voting) by The Testor Corporation; 100% of the outstanding Series G Preferred Stock (non-voting) by Tremco Incorporated; 100% of the outstanding Series I Preferred Stock (non-voting) by Zinsser Co., Inc.; and 100% of the outstanding Series J Preferred Stock (non-voting) by Tremco Barrier Solutions, Inc. | |
RPM Funding Corporation owns 5% of the outstanding shares in Carboline Norge A/S, a Norwegian corporation. Of the remaining outstanding shares in Carboline Norge A/S, Carboline International Corporation owns 40% and 55% are held by a joint venture partner. | ||
Weatherproofing Technologies, Inc. owns .0025% of the outstanding shares in Toxement S.A., a Colombian corporation. Of the remaining outstanding shares in Toxement S.A., Grandcourt N.V. owns 50.99%, The Euclid Chemical Company owns 49% and Euclid Chemical International Sales Corp., Redwood Transport, Inc. and Tremco Incorporated each own .0025%. |
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(1) | Registration Statements (Form S-8 Nos. 033-32794, 1989 Stock Option Plan; 333-35967 and 333-60104, 1996 Stock Option Plan; 333-101512, Deferred Compensation Plan; 333-101501, 401(k) Trust and Plan and Union 401(k) Retirement Savings Trust and Plan; 333-117581, 2003 Restricted Stock Plan for Directors; 333-120067, 2004 Omnibus Equity and Incentive Plan; and 333-139906, 2007 Restricted Stock Plan) |
|
/s/ Ernst & Young LLP
|
/s/ Ciulla, Smith & Dale, LLP | ||||
Ciulla, Smith & Dale, LLP | ||||
1. | I have reviewed this Annual Report on Form 10-K of RPM International Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
(c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
(d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: July 30, 2007 | /s/ Frank C. Sullivan | |||
Frank C. Sullivan | ||||
President and Chief Executive Officer | ||||
1. | I have reviewed this Annual Report on Form 10-K of RPM International Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
(c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
(d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
Date: July 30, 2007 | /s/ Robert L. Matejka | |||
Robert L. Matejka | ||||
Vice President, Chief Financial Officer and Controller | ||||
Dated: July 30, 2007 | /s/ Frank C. Sullivan | |||
Frank C. Sullivan | ||||
President and Chief Executive Officer | ||||
Dated: July 30, 2007 | /s/ Robert L. Matejka | |||
Robert L. Matejka | ||||
Vice President, Chief Financial Officer and Controller | ||||