DEF 14A of Masco Corp /De/
Filed Apr 7, 2025 · FY20240001193125-25-074658
DIRECTORS AND DIRECTOR NOMINEES
DIRECTORS AND DIRECTOR NOMINEES Our Board is currently composed of eleven directors. As of March 5, 2025, in connection with Mr. Nudi’s appointment as our next President and CEO, our Board determined that Mr. Nudi is no longer an independent director, and accordingly, nine of our eleven directors are independent directors. As of the date of our 2025 Annual Meeting, in connection with Mr. Parfet’s retirement from our Board, we will have ten continuing directors, eight of whom will be independent. In connection with Mr. Allman’s retirement as our President and CEO on July 6, 2025, his service as a director on our Board will conclude and we will then have nine continuing directors, eight of whom will be independent. Our directors possess a wide array of skills and experience that provide a strong source of strategic and risk oversight, advice, and guidance to our management team. The following director skills matrix highlights the balanced mix of skills and experience that are most relevant and important to our Company. The skills and experience identified for each continuing director are those we believe are key and unique to each director’s contribution to our Board. This matrix is not meant to encompass or reflect all of the skills and experience possessed by each director. See the following pages for a full biography of each of our continuing directors.
DIRECTORS AND DIRECTOR NOMINEES
| | Alexander | Allman | Denari | Ffolkes | Nudi | O’Herlihy | Payne | Plant | Reddy | Stevens | | Business Operations & Leadership Executive leadership experience at a large organization, including current or former service as a public company officer. | | | | | | | | | | | | M&A Experience executing significant acquisitions and other organizational transactions to drive growth and advance long-term strategic plans | | | | | | | | | | | | Risk Management Experience effectively prioritizing and managing broad enterprise risks as well as anticipating and identifying emerging risks relevant to the business | | | | | | | | | | | | Finance & Accounting Experience with complex financial transactions and in driving capital allocation strategy, as well as a deep understanding of financial reporting and controls | | | | | | | | | | | | Product Innovation Experience driving market share growth through the successful execution of new product development initiatives | | | | | | | | | | | | International Business Leadership and oversight experience with multinational companies in global markets, with a deep knowledge of global industry dynamics and risks | | | | | | | | | | | | Manufacturing Expertise in managing and overseeing complex manufacturing operations, including knowledge of production processes, industry standards and safety protocols | | | | | | | | | | | | Marketing & Brand Management Expertise in the marketing and sales of industry-leading consumer products with a deep expertise in strengthening brand reputation | | | | | | | | | | | | Talent Management Expertise in the execution of talent management strategies and initiatives, including those focused on key employee development and retention, and succession planning | | | | | | | | | | |
DIRECTORS AND DIRECTOR NOMINEES
DIRECTOR NOMINEES FOR CLASS I (if elected, term will expire at our Annual Meeting in 2028)
DIRECTORS AND DIRECTOR NOMINEES
| Jonathon J. Nudi Age: 54 Director Since: 2023 Not Independent Board Committees: • None | Our next President and CEO, effective July 7, 2025 Current Position: Group President, Pet, International and North America Foodservice, General Mills Inc., since 2024 Relevant Skills and Experience: • Business Operations and Leadership: Extensive strategic and operational experience developed through serving in a variety of leadership positions, including driving profitable growth through organizational transformation and capability building • Marketing and Brand Management: Significant experience with consumer-branded products developed through his 30 years of experience with General Mills, including various positions of increasing responsibility in marketing and sales • International Business: Complex international experience gained through serving in a variety of positions in Europe, and leading segments that service consumers and customers in Asia, Australia, Europe, and Latin America • Product Innovation: Deep perspectives developed over his career, including responsibility for product development and a focus on consumer-first design process and product improvements Business Experience: • General Mills, Inc.: • Group President, North American Retail (2016-2023) • President, Europe and Australasia Region (2014-2016) • President, Snacks Division (2010-2014) • Vice President Marketing, Business Unit Director, Green Giant/SGC (2007-2010) Memberships in Other Organizations: • Board of Governors, First Tee, a charitable organization |
DIRECTORS AND DIRECTOR NOMINEES
| Lisa A. Payne Age: 66 Director Since: 2006 Independent Board Committees: • None | Position: Independent Chair of our Board, since 2021 Relevant Skills and Experience: • Business Operations and Leadership: Deep understanding of growth strategy and extensive experience in real estate investment, development and acquisition, as well as extensive experience in senior level and C-Suite roles • M&A: Significant experience developed during her 10 years as an investment banker, focused on acquisition and development financing and merger and acquisition advisory services • Risk Management: In-depth expertise gained through her finance-focused career, including in her prior role as CFO in which she gained deep understanding of macroeconomic risks that may impact business • Finance and Accounting: Substantial financial, accounting and corporate finance expertise gained through her experience as CFO and as an investment banker Business Experience: • President, Soave Real Estate Group, a privately held diversified management and investment company (2016-2017) • Taubman Centers, Inc.: • Vice Chair (2005-2016) • Chief Financial Officer (2005-2015) • Executive Vice President and Chief Financial and Administrative Officer (1997- 2005) • Investment banker, Goldman, Sachs & Co. (1987-1997) Other Public Company Boards: • Rockwell Automation, Inc. (since 2015) • J.C. Penney Company (2016-2020) • Taubman Centers, Inc. (1997-2016) Memberships in Other Organizations: • Chair of the Board, Soave Enterprises, LLC, a privately held diversified management and investment company (2016-2017) |
DIRECTORS AND DIRECTOR NOMINEES
| Sandeep Reddy Age: 54 Director Since: 2023 Independent Board Committees: • Audit • Governance | Position: Executive Vice President – Chief Financial Officer, Domino’s Pizza, Inc., since 2022 Relevant Skills and Experience: • Business Operations and Leadership: Extensive experience gained over his almost 30 years serving in leadership roles at global consumer-facing businesses, including in business strategy development and through the oversight of international supply chain operations • Finance and Accounting: Significant expertise developed in numerous CFO roles with oversight of all financial operations and functions, including his current role where he is responsible for financial strategy and operations, including financial planning, treasury, financial reporting, tax, accounting and investor relations • International Business: Extensive experience in international business operations acquired while holding leadership positions for operations based in Europe and India • Risk Management: Expertise gained while serving in CFO roles with responsibility for risk oversight and, in his current role, responsibility for leading Domino’s environmental, social and governance efforts Business Experience: • Executive Vice President and Chief Financial Officer, Six Flags Entertainment Corporation (2020-2022) • Guess?, Inc.: • Chief Financial Officer (2013-2019) • Vice President and European Chief Financial Officer (2010-2013) • Served in various positions of increasing responsibility for Mattel, Inc., ultimately serving as Vice President of Finance and Supply Chain for France, Spain, Portugal and Italy (1997-2010) |
DIRECTORS AND DIRECTOR NOMINEES
CLASS II DIRECTORS (term expiring at our Annual Meeting in 2026)
DIRECTORS AND DIRECTOR NOMINEES
| Keith J. Allman Age: 62 Director Since: 2014 Not Independent Board Committees: • None | Position: Our President and Chief Executive Officer, since 2014 (Mr. Allman will be retiring from his position with our Company and as a member of our Board effective July 6, 2025) Relevant Skills and Experience: • Business Operations and Leadership: Strong business leadership skills and hands-on operational experience with our businesses have helped to provide the foundation for the current direction of our Company. Mr. Allman has, through his key leadership positions within our Company, acquired a deep knowledge of all aspects of our business, significant understanding of complex global operations, as well as Company-specific customer expertise • Manufacturing: Extensive experience gained through his decades in leading our cabinet and faucet manufacturing operations • Marketing and Brand Management: Expertise developed while playing an integral role in developing our strategies to strengthen our brands and overseeing our innovation efforts • Talent Management: Valuable insight into our Company’s culture developed over his many years with the Company, and, as our CEO, his overall responsibility for our human capital management strategy and initiatives Business Experience: • Masco Corporation: • Group President (2011-2014) • President, Delta Faucet (2007-2011) • Executive Vice President, Builder Cabinet Group (2004-2007) • Served in various management positions of increasing responsibility at Merillat Industries (1998-2003) Other Public Company Boards: • Oshkosh Corporation (since 2015) Memberships in Other Organizations: • Director, No Barriers, a charitable organization |
DIRECTORS AND DIRECTOR NOMINEES
| Aine L. Denari Age: 52 Director Since: 2022 Independent Board Committees: • Audit • Governance | Position: Executive Vice President and President of Navico Group and Chief Technology Officer of Brunswick Corporation, a manufacturer of marine products, since 2024 Relevant Skills and Experience: • Business Operations and Leadership: Extensive business and strategic experience acquired serving in a variety of executive management positions, including her current role, and in prior roles within the automotive and industrial industries and at major global consulting firms • M&A: Deep experience developed while at ZF, where she was responsible for the integration between ZF and TRW, including the strategy and implementation of all functions, businesses, systems and processes • Product Innovation: Expertise gained in her current role, where she is responsible for the oversight of technology strategy and advanced development activities, including artificial intelligence activities, for Brunswick’s entire portfolio, and in her former roles developing and implementing end-to-end technology solutions and overseeing the development of Advanced Driver Assist Systems/Automated Driving • Marketing and Brand Management: Significant experience gained in her current role where she is responsible for 23 marine brands, which comprise the most comprehensive bow-stern portfolio offering in the world Business Experience: • Executive Vice President and President of Brunswick Boat Group, Brunswick Corporation (2020-2024) • ZF AG: • Senior Vice President and General Manager, Advanced Driver Assist Systems/Automated Driving (2017-2020) • Chief Integration Management Officer & Head of Strategic Performance Management Office (2015-2017) • Senior Vice President, Product Planning and Business Development (2014-2017) • Director, Strategy & Analytics, Ingersoll Rand Inc (2010-2014) • Engagement Manager, McKinsey & Company (2006-2010) • Management Consultant / Case Team Leader, Bain & Company (2003-2006) • Served in various engineering roles, including research, product planning and development and program management at Ford Motor Company (1996-2002) |
DIRECTORS AND DIRECTOR NOMINEES
| Christopher A. O’Herlihy Age: 61 Director Since: 2013 Independent Board Committees: • Compensation (Chair) | Position: President and Chief Executive Officer, Illinois Tool Works Inc., a global diversified industrial manufacturer of specialized industrial equipment, consumables, and related service businesses, since 2024 Relevant Skills and Experience: • Business Operations and Leadership: Extensive experience acquired in his executive positions, through which he has acquired deep knowledge and experience in all aspects of business operations, including strategy development, product development, emerging markets and financial performance and structure • International Business: Significant expertise acquired while overseeing business operations in Europe, South America and Asia • Manufacturing: In-depth understanding of complex manufacturing operations gained during his more than 30 years with Illinois Tool Works • Talent Management: Significant experience gained in leading and developing high-performing and key talent, including executive-level talent, through his over ten years serving in executive leadership positions Business Experience: • Illinois Tool Works Inc.: • Vice Chair (2015-2023) • Executive Vice President, with worldwide responsibility for Illinois Tool Works’ Food Equipment Group (2010-2015) • Group President – Food Equipment Group Worldwide (2010) • Group President – Food Equipment Group International (2009-2010) • For almost 30 years, served in various positions of increasing responsibility, including as Group President of the Polymers and Fluids Group Other Public Company Boards: • Illinois Tool Works (since 2024) |
DIRECTORS AND DIRECTOR NOMINEES
| Charles K. Stevens, III Age: 65 Director Since: 2018 Independent Board Committees: • Audit (Chair) • Compensation | Position: Retired Executive Vice President and Chief Financial Officer, General Motors Company Relevant Skills and Experience: • Business Operations and Leadership: Significant experience gained in his over 40 years with GM serving in leadership roles with oversight of financial and accounting operations, through which he developed and executed business strategies to drive profitable growth • Risk Management: Strong analytic, strategic and financial skills and expertise developed through his extensive career at GM, which provides valuable perspectives and experience in performing risk evaluation, management and mitigation • Finance and Accounting: Extensive expertise developed over his time at GM serving in senior leadership roles with responsibility for overseeing all financial and accounting functions, resulting in a valuable understanding of finance, financial operations, international financial matters and investor relations • International Business: In-depth knowledge gained while serving for over 15 years in leadership positions in South America, Mexico and the Asia Pacific region, including China, Singapore, Indonesia and Thailand Business Experience: • General Motors Company, a global automotive company (1978 – 2019): • Advisor (2018-2019) • Executive Vice President and Chief Financial Officer (2014-2018) • Chief Financial Officer, GM North America (2010-2014) • Interim Chief Financial Officer, GM South America (2011-2013) • Chief Financial Officer, GM de Mexico (2008-2010) • Chief Financial Officer, GM Canada (2006-2008) • Held various positions of increasing responsibility, including several leadership positions with GM’s Asia Pacific region including China, Singapore, Indonesia and Thailand Other Public Company Boards: • Genuine Parts Company (since 2024) • Flex, Ltd. (since 2018) • Eastman Chemical Company (2022-2024) • Tenneco Inc. (2020-2022) |
DIRECTORS AND DIRECTOR NOMINEES
CLASS III DIRECTORS (term expiring at our Annual Meeting in 2027)
DIRECTORS AND DIRECTOR NOMINEES
| Mark R. Alexander Age: 60 Director Since: 2014 Independent Board Committees: • Compensation • Governance | Position: Chief Executive Officer, Icelandic Provisions, Inc., a provider of Icelandic dairy products, since 2019 Relevant Skills and Experience: • Business Operations and Leadership: Strong experience in leadership and the successful execution of business growth strategy developed through his current experience as a CEO and as the former President of Campbell Soup Company’s largest division • International Business: Significant experience gained through his nearly 35-year career serving in various marketing, sales and management roles in the United States, Canada, Europe and Asia • Product Innovation: Deep expertise gained through his management responsibilities, including investing in brand-building, innovation and distribution • Marketing and Brand Management: Extensive experience with consumer-branded products, and a significant background in marketing and customer relations in his various roles Business Experience: • Campbell Soup Company: • Senior Vice President (2009-2018) • President of Americas Simple Meals and Beverages (2015-2018) • President of Campbell North America (2012-2015), Campbell International (2010-2012) and Asia Pacific (2006-2009) • Chief Customer Officer and President—North America Baking & Snacking (2009-2010) • Served in various marketing, sales and management roles in the United States, Canada, Europe and Asia since 1989 |
DIRECTORS AND DIRECTOR NOMINEES
| Marie A. Ffolkes Age: 53 Director Since: 2017 Independent Board Committees: • Governance (Chair) | Position: Managing Partner, GenNx360 Capital Partners, a private equity firm focused on investing in industrial and business services companies, since 2023 Relevant Skills and Experience: • Business Operations and Leadership: Extensive experience acquired in developing and leading strategy implementation and driving operational profitability, as well as significant leadership experience • International Business: Global and cultural experience developed serving in leadership positions in China, South Korea, Brazil, Japan and Europe • Manufacturing: Significant experience with global manufacturing operations across multiple industrial sectors • Talent Management: Significant human capital experience gained in leadership roles of increasing responsibility across many industries and geographies Business Experience: • Founder and CEO, Axxelist, LLC, a private technology real estate company (since 2021) • Chief Executive Officer, TriMark USA, LLC (2020-2021) • President, Industrial Gases, Americas of Air Products & Chemicals, Inc. (2015-2020) • Tenneco: • Global Vice President and General Manager, Ride Performance Group (2013-2015) • Vice President and General Manager, Global Elastomers (2011-2013) • Johnson Controls International plc (formerly, Johnson Controls): • Vice President & General Manager South America Region, Automotive Group (2010-2011) • Vice President and General Manager, Hyundai-Kia Customer Business Unit (2008-2010) • Global Vice President, Japan (2006-2008) Other Public Company Boards: • Valero Energy Corporation (since 2022) |
DIRECTORS AND DIRECTOR NOMINEES
| John C. Plant Age: 71 Director Since: 2012 Independent Board Committees: • Audit • Governance | Position: Chair of the Board and Chief Executive Officer, Howmet Aerospace Inc., a global supplier of engineered metal products, since 2020 Relevant Skills and Experience: • Business Operations and Leadership: In-depth knowledge gained throughout his over three decades of executive leadership with experience in successfully leading businesses through periods of downturns as well as periods of growth and market development • M&A: Deep expertise gained through various roles, including leading the separation of Arconic Inc. into two independent, publicly traded companies – Howmet Aerospace Inc. and Arconic Corporation • Finance and Accounting: A strong background in finance through various roles, including key finance and operations positions • Manufacturing: Substantial expertise developed during his more than 20 combined years of global experience in manufacturing and engineered solutions at industrial companies Business Experience: • Chief Executive Officer (2019-2020) and Chair of the Board (2017-2020), Arconic Inc. • TRW Automotive Holdings Corp.: • Chair of the Board (2011-2015) • President and Chief Executive Officer and Director (2003-2015) • Co-member of the Chief Executive Office of TRW Inc. and the President and Chief Executive Officer of the automotive business of TRW Inc. (2001-2003) Other Public Company Boards: • Howmet Aerospace Inc. (since 2020) • Jabil Inc. (since 2016) Memberships in Other Organizations: • Director Emeritus, Automotive Safety Council • Director, Gates Industrial Corporation plc, a privately-held manufacturer of casters and wheels (2017-2019) |
BOARD OF DIRECTORS
BOARD OF DIRECTORS Our Board of Directors is committed to maintaining our high standards of ethical business conduct and corporate governance principles and practices.
DIRECTOR COMPENSATION PROGRAM
DIRECTOR COMPENSATION PROGRAM Our non-employee directors receive the following compensation for service on our Board:
DIRECTOR COMPENSATION PROGRAM
| Compensation Element | Amount | | Annual Cash Retainer | $130,000 | | Annual Equity Retainer (a) | Restricted stock units with a value of $180,000 that vest in three equal installments over three years | | Annual Chair of the Board Cash Retainer | $200,000 | | Annual Committee Chair Cash Retainer | $25,000 for the Audit Committee $20,000 for the Compensation Committee $20,000 for the Governance Committee | | Meeting Fee (b) | None | | Stock Retention Guideline | Directors must retain shares of our stock valued at five times their annual cash retainer fee (not inclusive of Chair retainers) within 5 years of joining our Board |
DIRECTOR COMPENSATION PROGRAM
Annual Equity Retainer (row a): In 2024, the annual equity retainer was paid in the form of restricted stock units granted under our Non-Employee Director Equity Program. Our 2024 Long Term Stock Incentive Plan imposes a limit on the amount of equity a director may receive during a year of restricted stock units or equity with a grant date value of $750,000. Meeting Fee (row b): Our Board may approve the payment of meeting fees to directors serving on three or more standing committees or serving as members of a special committee constituted by our Board. No such fees were paid for 2024.
Annual Review of our Director Compensation Program
Annual Review of our Director Compensation Program Our Governance Committee reviews our director compensation program annually, including reviewing an analysis of the competitiveness of the program, and recommends any changes to our Board. In 2024, the Committee recommended to the Board that it increase the equity retainer paid to our non-employee directors by $20,000 to $180,000, and increase the retainer paid to our Governance Committee Chair by $5,000 to $20,000. Our Board approved these recommendations.
Director Compensation Table
Director Compensation Table The following table reflects 2024 compensation paid to our directors who served on our Board in 2024, other than Keith Allman, who is also a Company employee and receives no additional compensation for his service as a director.
Director Compensation Table
| Name | Cash Fees Earned ($) | Restricted Stock Units ($) (a) | All Other Compensation ($) (b) | Total ($) | | Mark R. Alexander | 130,000 | 180,052 | — | 310,052 | | Aine L. Denari | 130,000 | 180,052 | — | 310,052 | | Marie A. Ffolkes | 148,750 | 180,052 | — | 328,802 | | Jonathon J. Nudi | 130,000 | 180,052 | — | 310,052 | | Christopher A. O’Herlihy | 150,000 | 180,052 | 5,000 | 335,052 | | Donald R. Parfet | 130,000 | 180,052 | 5,000 | 315,052 | | Lisa A. Payne | 330,000 | 180,052 | — | 510,052 | | John C. Plant | 130,000 | 180,052 | — | 310,052 | | Sandeep Reddy | 130,000 | 180,052 | — | 310,052 | | Charles K. Stevens | 155,000 | 180,052 | — | 335,052 |
Director Compensation Table
Restricted Stock Units (column a): In May 2024, we granted 2,490 restricted stock units to each non-employee director serving on our Board. The amounts reported in this column reflect the aggregate grant date fair value of the restricted stock units, calculated in accordance with accounting guidance. Directors realize the value of these grants over time because the vesting occurs pro rata over three years. All Other Compensation (column b): The amounts reported in this column reflect our contributions in 2024 to eligible tax-exempt organizations under our matching gifts program, as described above, for which directors receive no direct financial benefit. Unvested Restricted Stock Units: The following table reports the unvested restricted stock units held on December 31, 2024 by each non-employee director who was serving on that date.
Director Compensation Table
| Director | Unvested Restricted Stock Units (#) | | Mark R. Alexander | 5,494 | | Aine L. Denari | 6,444 | | Marie A. Ffolkes | 5,494 | | Jonathon J. Nudi | 5,130 | | Christopher A. O’Herlihy | 5,494 | | Donald R. Parfet | 5,494 | | Lisa A. Payne | 5,494 | | John C. Plant | 5,494 | | Sandeep Reddy | 4,910 | | Charles K. Stevens | 5,494 |
PROPOSAL 1: ELECTION OF CLASS I DIRECTOR NOMINEES
PROPOSAL 1: ELECTION OF CLASS I DIRECTOR NOMINEES The term of office of our Class I Directors, who are Jonathon J. Nudi, Lisa A. Payne and Sandeep Reddy, expires at this meeting. Our Board proposes the re-election of Mr. Nudi, Ms. Payne and Mr. Reddy to serve as Class I Directors. The term of the Class I Directors elected at this Annual Meeting will expire at the Annual Meeting of Stockholders in 2028, or when their respective successors are elected and qualified. Our Board expects that the persons named as proxy holders on the proxy card will vote the shares represented by each proxy for the election of each director nominee unless a contrary direction is given. If, prior to the meeting, a nominee is unable or unwilling to serve as a director, which our Board does not expect, the proxy holders may vote for an alternate nominee recommended by our Board, or our Board may reduce its size. Information regarding each of our director nominees can be found above in “Director Nominees for Class I.” Our Board recommends a vote FOR the election to our Board of Directors of each of the following Class I Director nominees:
PROPOSAL 1: ELECTION OF CLASS I DIRECTOR NOMINEES
| Name | Director Since | Occupation | | Jonathon J. Nudi | 2023 | Our next President and CEO, effective July 7, 2025 Current Position: Group President, Pet, International and North America Foodservice, General Mills Inc. | | Lisa A. Payne | 2006 | Independent Chair of our Board, since 2021 | | Sandeep Reddy | 2023 | Executive Vice President – Chief Financial Officer, Domino’s Pizza, Inc. |
PROPOSAL 1: ELECTION OF CLASS I DIRECTOR NOMINEES
The affirmative vote of a majority of the votes cast by shares is required for the election of directors. Abstentions and broker non-votes are not counted as votes cast, and therefore do not affect the outcome of the election. If an incumbent Director nominee fails to receive a majority of the votes cast, the Director is required to give his or her resignation to our Board. Our Board has 90 days after certification of the election results to decide whether to accept the Director’s resignation.
PROPOSAL 1: ELECTION OF CLASS I DIRECTOR NOMINEES
| | COMPENSATION DISCUSSION AND ANALYSIS |
COMPENSATION PROGRAM HIGHLIGHTS
| • | Our compensation program is designed to emphasize pay-for-performance. For 2024, our executive compensation program was significantly dependent on our performance. Components of our program include an annual cash incentive, an annual restricted stock unit (“RSU”) award based on delivered performance, a long-term performance-based award if three-year performance criteria is met and stock options. The RSUs and stock options vest ratably over 3 years. |
COMPENSATION PROGRAM HIGHLIGHTS
| • | We achieved 88% of our annual performance program’s performance target. For 2024, our annual incentives were based on the financial metrics of operating profit and net sales. As a result of our performance in 2024, which was impacted by our softer sales volume, our executive officers earned 88% of target under our annual performance program, and received a cash bonus and an award of RSUs consistent with this performance. |
COMPENSATION PROGRAM HIGHLIGHTS
| • | Our performance did not result in a payout under our 2022-2024 Long-Term Incentive Program (“LTIP”). For the three-year period of 2022-2024, our LTIP was based on the financial metrics of cumulative earnings per share (“EPS”) and a three-year average return on invested capital (“ROIC”). We did not achieve our threshold level of achievement for either metric, and as a result, our executive officers did not receive a stock award under the program. |
PERFORMANCE COMPENSATION EARNED UNDER OUR PROGRAMS
| 2024 Annual Performance Program | | | | | 2022-2024 LTIP | | | | | | Financial Performance Metric | Metric Weight | Target | Actual Performance (as adjusted) | Performance Percentage | Financial Performance Metric | Metric Weight | Target | Actual Performance (as adjusted) | Performance Percentage | | Operating Profit (in millions) | 75% | $1,379 | $1,372 | 73% | Cumulative EPS | 60% | $13.75 | $11.50 | 0% | | Net Sales (in millions) | 25% | $7,972 | $7,828 | 15% | Three-Year Average ROIC | 40% | 52.0% | 42.9% | 0% | | Total Performance Percentage | | | | 88% | Total Performance Percentage | | | | 0% |
PERFORMANCE COMPENSATION EARNED UNDER OUR PROGRAMS
| • | See “Our 2024 Annual Performance Program” and “Our Long-Term Incentive Program” below for a discussion of the establishment of our performance metrics and goals and a description of our calculation of operating profit, net sales, cumulative EPS and ROIC performance. |
PERFORMANCE COMPENSATION EARNED UNDER OUR PROGRAMS
Based on this performance, our eligible executive officers earned a cash bonus and RSU award under our 2024 annual performance program. The performance restricted stock units (“PRSUs”) granted to our executive officers in 2022 under our 2022-2024 LTIP did not vest, and therefore our executive officers did not receive a stock award under our 2022-2024 LTIP.
PERFORMANCE COMPENSATION EARNED UNDER OUR PROGRAMS
| Name | Cash Bonus ($) | Restricted Stock Unit Award ($) | 2022-2024 LTIP- Stock Award ($) | Total Performance Compensation ($) | | Keith J. Allman | 1,682,100 | 2,274,266 | — | 3,956,366 | | Richard J. Westenberg | 525,700 | 525,487 | — | 1,051,187 | | Imran Ahmad | 349,800 | 350,066 | — | 699,866 | | Jai Shah | 422,500 | 422,253 | — | 844,753 | | Kenneth G. Cole | 376,900 | 377,233 | — | 754,133 |
PERFORMANCE COMPENSATION EARNED UNDER OUR PROGRAMS
| • | Restricted stock units vest in equal installments over three years following the grant date, so our executive officers do not realize the value of these awards until they vest. |
PERFORMANCE COMPENSATION EARNED UNDER OUR PROGRAMS
| • | Richard J. Westenberg and Imran Ahmad did not participate in our 2022-2024 LTIP. |
OTHER PERFORMANCE COMPENSATION WE AWARDED IN 2024
OTHER PERFORMANCE COMPENSATION WE AWARDED IN 2024 We grant stock options annually to our executive officers to align their long-term interests with those of our shareholders by reinforcing the goal of long-term share price appreciation. These stock options will provide value to our executive officers only if the price of our common stock increases above the option exercise price. On February 16, 2024, our Compensation Committee awarded the following stock options to our executive officers; these stock options will vest ratably over three years.
OTHER PERFORMANCE COMPENSATION WE AWARDED IN 2024
| Name | Stock Options Awarded (#) | Stock Option Exercise Price ($ per share) | Value of Stock Options Awarded at Grant ($) | | Keith J. Allman | 103,050 | 73.16 | 2,442,903 | | Richard J. Westenberg | 24,470 | 73.16 | 580,086 | | Imran Ahmad | 15,820 | 73.16 | 375,029 | | Jai Shah | 19,470 | 73.16 | 461,556 | | Kenneth G. Cole | 17,210 | 73.16 | 407,980 |
OTHER PERFORMANCE COMPENSATION WE AWARDED IN 2024
| • | The stock options reflected in this table were priced based on our closing stock price on February 16, 2024, the date of grant. The column “Value of Stock Options Awarded at Grant” shows the aggregate grant date fair value of the stock options awarded, calculated in accordance with accounting guidance. |
OTHER PERFORMANCE COMPENSATION WE AWARDED IN 2024
| ü | An Emphasis on Long-Term Performance—Our compensation programs are weighted toward long-term incentives. In 2024, we gave approximately equal weight to RSUs, stock options and our three-year incentive program, under which we grant performance-based restricted stock units (“PRSUs”). |
OTHER PERFORMANCE COMPENSATION WE AWARDED IN 2024
| ü | Annual Restricted Stock Units Granted on Performance Delivered—For the 2024 performance period, our annual grant of RSUs was based on our executive officers’ target opportunities, which are established at the beginning of the year, and the achievement of our performance goals under our annual performance program. |
OTHER PERFORMANCE COMPENSATION WE AWARDED IN 2024
| ü | Long-Term Performance Program—A meaningful portion of our executive officers’ compensation opportunity is based on the achievement of three-year performance goals. |
OTHER PERFORMANCE COMPENSATION WE AWARDED IN 2024
| ü | Double-Trigger Vesting—We have double-trigger vesting of equity upon a change in control. |
OTHER PERFORMANCE COMPENSATION WE AWARDED IN 2024
| ü | Competitive Analysis—On an annual basis, our Compensation Committee reviews a market analysis of CEO and CFO compensation paid by our peer companies and published survey data for comparably-sized companies. |
OTHER PERFORMANCE COMPENSATION WE AWARDED IN 2024
| × | Excise Tax Gross-Ups—Our equity grants do not provide for excise tax gross-ups. |
OTHER PERFORMANCE COMPENSATION WE AWARDED IN 2024
| × | Employment Agreements and Change in Control Agreements—We have no employment agreements or change in control agreements with our executive officers. |
Our 2024 Annual Performance Program
Our 2024 Annual Performance Program
Program Opportunities
| Name | Target Opportunity for Cash Bonus as a % of Annual Base Salary | Target Opportunity for Restricted Stock Units as a % of Annual Base Salary | | Keith J. Allman | 150% | 202.8% | | Richard J. Westenberg | 80% | 80% | | Imran Ahmad | 75% | 75% | | Jai Shah | 75% | 75% | | Kenneth G. Cole | 70% | 70% |
Program Opportunities
| • | Keith Allman’s target opportunity for restricted stock units as a percent of his annual base salary under our 2024 annual performance program increased from to 202.8% from 191.7%. This increase reflects Mr. Allman’s positive impact on and contributions to our Company and aligns with market practice. |
Performance Metrics
Performance Metrics Our Compensation Committee selected the financial metrics of operating profit (weighted at 75%) and net sales (weighted at 25%) for our 2024 annual performance program, because it believed that improvement in these metrics would continue to reinforce our executive officers’ focus on profit growth and revenue to drive shareholder value. Additionally, these metrics are easily derived from our audited financial statements, which our Compensation Committee believes provides transparency for both our shareholders (as requested from shareholders when we sought feedback) and our executive officers. We calculated the cash bonuses to be paid and restricted stock units to be granted to our executive officers under the annual performance program by multiplying each executive officer’s base salary by his or her target opportunity and multiplying that result by the program performance percentage achieved. The total payout for each executive officer is limited to 200% of the target opportunity.
Performance Metrics
| Base SalaryX | Target OpportunityX | Financial Metrics | = | Annual Performance Percentage | | | | Operating Profit Performance Percentage (75%) | | | | | | + | | | | | | Net Sales Performance Percentage (25%) | | |
Compensation Paid Under the 2024 Annual Performance Program
Compensation Paid Under the 2024 Annual Performance Program Based on a total performance percentage of 88%, we calculated the actual cash bonuses to be paid and restricted stock units to be granted to our executive officers as follows:
Compensation Paid Under the 2024 Annual Performance Program
| Name | Amount of Cash Bonus ($) | Value of Restricted Stock Unit Award ($) | Total 2024 Annual Performance Compensation ($) | | Keith J. Allman | 1,682,100 | 2,274,266 | 3,956,366 | | Richard J. Westenberg | 525,700 | 525,487 | 1,051,187 | | Imran Ahmad | 349,800 | 350,066 | 699,866 | | Jai Shah | 422,500 | 422,253 | 844,753 | | Kenneth G. Cole | 376,900 | 377,233 | 754,133 |
Compensation Paid Under the 2024 Annual Performance Program
| • | The number of restricted stock units granted is determined by dividing the value of the restricted stock unit award by the closing price of our common stock on the grant date and rounding to the nearest ten shares. These restricted stock units vest in equal installments over three years following the grant date, so our executive officers do not realize the value of these awards until they vest. |
Our Long-Term Incentive Program
Our Long-Term Incentive Program
Program Opportunities
Program Opportunities Our Compensation Committee believes a long-term incentive program provides a meaningful incentive for our executive officers to achieve long-term growth and profitability. Under our LTIP, PRSUs are granted to our executive officers at the beginning of each three-year performance period. This grant of PRSUs entitles our executive officers to receive shares of our stock if at least the threshold performance goals over the three-year period are achieved. If the threshold goals are not achieved, our executive officers do not earn a payout. If the maximum goals are exceeded, the payout percentage is capped at 200% of the target opportunity. Our Compensation Committee establishes the LTIP opportunity available to each executive officer as a percent of the executive officer’s annual base salary at the beginning of each three-year performance period. Our executive officers who participated in our 2022-2024 LTIP had the following target opportunities:
Program Opportunities
| Name | Target Opportunity Under 2022-2024 LTIP as a % of Annual Base Salary | | Keith J. Allman | 191.7% | | Jai Shah | 75% | | Kenneth G. Cole | 65% |
Program Opportunities
| • | Richard J. Westenberg and Imran Ahmad did not participate in our 2022-2024 LTIP. |
Performance Metrics
Performance Metrics Our Compensation Committee selected a cumulative EPS metric with a weighting of 60% and a three-year average ROIC metric with a weighting of 40% for our LTIP program for the 2022-2024 LTIP performance period. Our Compensation Committee believes that a combination of EPS and ROIC reinforces our executive officers’ focus on earnings, capital efficiency and consistent return on capital and further encourages our executive officers to make new, profitable investments. In 2023, our Compensation Committee added a relative total shareholder return metric, measured against companies in the S&P 500 Consumer Durables Index, to our LTIP program for the three-year periods beginning in 2023.
Program Targets and Achievement
Program Targets and Achievement Our Compensation Committee established the following EPS and ROIC goals and corresponding payout percentages for the 2022-2024 LTIP performance period. These performance goals were consistent with our long-range business plan and were established to require a high level of performance to achieve. For the three-year performance period of 2022-2024, we did not achieve our threshold level of achievement for either metric, and as a result, our executive officers did not receive a stock award under the program. To calculate achievement of our cumulative earnings per share performance target, we adjusted our income from continuing operations to exclude the after-tax effect of special and other non-recurring income and expenses and divided by adjusted average diluted common shares outstanding. Average diluted common shares outstanding for each year during the performance period was increased to reflect the minimum number of common shares outstanding permitted under the LTIP during the performance period. PART II — COMPENSATION DISCUSSION AND ANALYSIS
PRSUs Granted Under the 2024-2026 LTIP
PRSUs Granted Under the 2024-2026 LTIP The following table reflects the PRSUs granted to our eligible executive officers under the 2024-2026 LTIP. The amounts reflected in the PRSU Target Grant column are the number of PRSUs granted on February 23, 2024, which we calculated using the closing price of our stock on the grant date ($74.94) and rounded to the nearest ten shares, assuming the target award would be earned at the end of the three-year performance period. The actual number of shares of stock awarded, if any, will be determined after the three-year performance period concludes on December 31, 2026. If the threshold goals are not achieved, our executive officers will not earn a stock award. If the maximum goals are exceeded, the stock award opportunity is capped at 200% of the target opportunity.
PRSUs Granted Under the 2024-2026 LTIP
| Name | Target Opportunity as a Percentage of Annual Base Salary | 2024-2026 LTIP PRSU Target Grant (#) | | Keith J. Allman | 202.8% | 34,490 | | Richard J. Westenberg | 80% | 7,740 | | Imran Ahmad | 75% | 5,000 | | Jai Shah | 75% | 6,160 | | Kenneth G. Cole | 70% | 5,440 |
PRSUs Granted Under the 2024-2026 LTIP
| • | Keith Allman’s target opportunity for PRSUs as a percent of his annual base salary under our 2024-2026 LTIP increased from to 202.8% from 191.7%. This increase reflects Mr. Allman’s positive impact on and contributions to our Company and aligns with market practice. |
Stock Options Granted In 2024
Stock Options Granted In 2024 We grant stock options annually to our executive officers. The value of the stock option grants approximates the restricted stock unit target opportunity for each executive officer under our annual performance program. Our Compensation Committee believes that stock options are an important component of our executive compensation program because they align our executive officers’ long-term interests with those of our shareholders. Because stock options only confer actual value if our stock price appreciates between the grant date and the exercise date, we believe they reinforce the goal of long-term share price appreciation. On February 16, 2024, our Compensation Committee awarded to our eligible executive officers the following stock options that vest in equal installments over three years:
Stock Options Granted In 2024
| Name | Stock Options Awarded (#) | Value of Stock Options Awarded ($) | | Keith J. Allman | 103,050 | 2,442,903 | | Richard J. Westenberg | 24,470 | 580,086 | | Imran Ahmad | 15,820 | 375,029 | | Jai Shah | 19,470 | 461,556 | | Kenneth G. Cole | 17,210 | 407,980 |
Stock Options Granted In 2024
| • | The stock options reflected in this table were priced based on our closing stock price of $73.16 on February 16, 2024, the date of grant. The column “Value of Stock Options Awarded” shows the aggregate grant date fair value of the stock options awarded, calculated in accordance with accounting guidance. |
Stock Options Granted In 2024
Our Compensation Committee established a pricing policy for our grants of equity awards, including stock options (the “Pricing Policy”). The Pricing Policy provides that if the Compensation Committee’s approval of an equity award occurs within four days prior to the release of our financial results or within one day following such release, the grant is effective at the end of the second trading day following the day we release our financial results and is priced based on the closing price of our common stock on that date.
Our Equity Awards Have Double-Trigger Change of Control Provisions
Our Equity Awards Have Double-Trigger Change of Control Provisions Upon a change of control of our Company, our unvested equity awards will vest only if the recipient of the award:
Our Equity Awards Have Double-Trigger Change of Control Provisions
| • | is terminated from employment at the time of the change in control or within two years after the change in control; |
Our Equity Awards Have Double-Trigger Change of Control Provisions
| • | terminates employment for good reason (for example, if his or her job duties have been significantly diminished); or |
Our Equity Awards Have Double-Trigger Change of Control Provisions
| • | does not receive comparable replacement awards by the acquiring company. |
Our Compensation Programs Encourage Executive Retention and Protect Us
| • | forfeit unvested awards of RSUs, stock options and PRSUs if their employment terminates prior to being retirement eligible under the applicable award agreement; |
We Do Not Have Employment Agreements or Change in Control Agreements
We Do Not Have Employment Agreements or Change in Control Agreements Our executive officers do not have employment agreements and are “at-will” employees who may be terminated at our discretion. Our executive officers also do not have change in control agreements. For further discussion regarding change in control, see “Payment Upon Change in Control” below. At our discretion, we may enter into severance arrangements or arrangements for an executive officer’s service following termination of employment. Such arrangements may include continued vesting of equity awards that would otherwise be forfeited, as well as provisions restricting competitive activities following termination and a release of any claims.
Our Peer Group
Our Peer Group Given the many and diverse businesses we operate, the composition of an appropriate peer group is challenging. Our Compensation Committee annually considers the composition of our peer group and believes that our current peer group reflects the companies we compete with for executive talent and that have a range of annual revenues and business and operational characteristics similar to ours. Our current peer group is as follows:
Our Peer Group
| Dover Corporation (DOV) | PPG Industries, Inc. (PPG) | | Fortive Corp. (FTV) | RPM International Inc. (RPM) | | Fortune Brands Innovations, Inc. (FBIN) | Snap-on Incorporated (SNA) | | Illinois Tool Works Inc. (ITW) | Stanley Black & Decker, Inc. (SWK) | | Leggett & Platt, Incorporated (LEG) | The Sherwin-Williams Company (SHW) | | Mohawk Industries, Inc. (MHK) | Trane Technologies plc (TT) | | Newell Rubbermaid Inc. (NWL) | Whirlpool Corporation (WHR) | | Owens Corning (OC) | Xylem Inc. (XYL) | | Pentair plc (PNR) | |
Pay-for-Performance Alignment
Pay-for-Performance Alignment Our Compensation Committee reviews the overall pay-for-performance alignment of our CEO’s compensation compared to our peer group over a three-year period. During 2024, our Compensation Committee reviewed data showing that our total shareholder return was at the 65th percentile of our peers for the three-year period ended December 31, 2023. Our CEO’s realizable compensation was at the 53rd percentile of our peer group during this three-year period. We defined realizable compensation as the sum of salary, actual cash bonus payments and the value of equity awards based on our stock price as of December 31, 2023. Based on its analysis, the Compensation Committee believes there is alignment between our CEO’s realizable compensation and our total shareholder return.
Market Data
Market Data We believe understanding market data allows us to attract and retain the talent we need, while enabling us to manage our compensation expense. Our Compensation Committee reviews compensation for each of our executive officers with published compensation surveys from AonHewitt, Mercer and WTW and, secondarily, with compensation information disclosed in the proxy statements of our peer group. When we achieve targeted levels of performance, our executive compensation program seeks to provide total target compensation (base salary, target annual bonus and the target value of long-term incentives) at approximately the median compensation level provided to executives in comparable positions at these companies. While our Compensation Committee generally targets total compensation for each executive officer at the median, it considers other factors, such as performance, the officer’s roles and responsibilities and the length of time the officer has served in the current position.
Tally Sheets
Tally Sheets Finally, our Compensation Committee reviews a tally sheet that summarizes all current compensation components of each of our executive officers. The tally sheet includes base salary, annual cash incentive compensation, long-term incentive compensation, retirement and savings plans, heath and welfare programs and other executive benefits. The tally sheet allows our Compensation Committee to compare an executive officer’s compensation with the compensation of our other executive officers as part of its consideration of internal and external pay competitiveness. Amounts actually realized by an executive officer from prior equity grants are not necessarily a factor in establishing current compensation, although the current value of outstanding equity awards may be considered by our Compensation Committee when assessing pay competitiveness.
Retention of Discretion by our Compensation Committee
Retention of Discretion by our Compensation Committee Our approach to executive compensation emphasizes corporate rather than individual performance, reflecting our operating strategy that encourages collaboration and cooperation among our businesses and corporate functions. We believe that the effectiveness of our executive compensation programs requires not only objective, formula-based arrangements but also the exercise of discretion and sound business judgment by our Compensation Committee. Accordingly, our Compensation Committee retains discretion to adjust the mix of cash and equity compensation, adjust the mix of restricted stock units and stock options awarded and offer different forms of equity-based compensation. Our Compensation Committee has the discretion to award time-based restricted stock units to our executive officers, other than our CEO, if it determines that an executive officer has made outstanding individual contributions during the prior year. The total value of these awards cannot exceed 20% of the combined annual base salaries of the executive officers (excluding the salary of our CEO). No discretionary awards were made in 2024.
Outside Compensation Consultant
Outside Compensation Consultant Our Compensation Committee has engaged Semler Brossy as its compensation consultant. Semler Brossy was chosen by our Compensation Committee based on its deep experience in the area of executive compensation and its creative and proactive approach in analyzing executive compensation practices and programs. During 2024, Semler Brossy attended Compensation Committee meetings, met with our Compensation Committee in executive sessions without our executive officers or other members of management, and met individually with our Compensation Committee members and our Compensation Committee Chair. Semler Brossy advised our Compensation Committee on its overall implementation of our compensation objectives, our equity program structure, our peer group, our director compensation practices and the compensation for our executive officers, including performing a competitive analysis of CEO compensation within our peer group, as well as for similarly situated companies outside of that group. After considering the factors promulgated by the SEC for assessing the independence of its advisors, our Compensation Committee has determined that the work of Semler Brossy has not raised any conflict of interest.
ACCOUNTING CONSIDERATIONS
ACCOUNTING CONSIDERATIONS Our Compensation Committee considers the accounting treatment of various elements of our executive compensation program. We issue stock-based incentives in various forms to our executive officers. Outstanding stock-based incentives were in the form of restricted stock units, performance restricted stock units, stock options, phantom restricted stock units, phantom performance restricted stock units and stock appreciation rights. We follow the FASB ASC Topic 718 for our stock-based compensation awards. We measure compensation expense for restricted stock units at the market price of our common stock at the grant date. We measure compensation expense for performance restricted stock units and phantom performance restricted stock units at the expected payout of the awards. We measure compensation expense for the relative total shareholder return metric for our performance restricted stock units using a Monte-Carlo pricing model that is updated at “expected” payout. We measure compensation expense for stock options using a Black-Scholes option pricing model. We initially measure compensation expense for phantom restricted stock units at the market price of our common stock at the grant date and we remeasure and adjust at the end of each reporting period until the awards are fully vested. We initially measure compensation expense for stock appreciation rights using a Black-Scholes option pricing model at the grant date and we remeasure and adjust at the end of each reporting period until the stock appreciation rights are exercised or expire.
SUMMARY COMPENSATION TABLE
SUMMARY COMPENSATION TABLE The following table reports compensation earned during the years indicated by Keith Allman, our principal executive officer, Richard Westenberg, our principal financial officer, and Imran Ahmad, Jai Shah and Kenneth Cole, our three other most highly compensated executive officers in 2024. We refer to the individuals listed in the table collectively as our “executive officers.”
2024 Summary Compensation Table
2024 Summary Compensation Table
2024 Summary Compensation Table
| Name and Principal Position | Year (a) | Salary ($) (b) | Bonus ($) (c) | Stock Awards ($) (d) | Option/SAR Awards ($) (e) | Non-Equity Incentive Plan Compensation ($) (f) | Change in Pension Value and Non- Qualified Deferred Compensation Earnings ($) (g) | All Other Compensation ($) (h) | Total ($) | | Keith J. Allman President and Chief Executive Officer | 2024 | 1,274,354 | — | 4,858,947 | 2,442,903 | 1,682,100 | — | 393,517 | 10,651,821 | | | 2023 | 1,274,354 | — | 5,876,604 | 2,442,978 | 2,658,900 | 8,768 | 214,777 | 12,476,381 | | | 2022 | 1,274,354 | — | 2,443,149 | 2,442,962 | — | — | 100,763 | 6,261,228 | | Richard J. Westenberg Vice President, Chief Financial Officer and Treasurer | 2024 | 741,322 | 570,000 | 1,105,523 | 580,086 | 525,700 | — | 110,368 | 3,632,999 | | | 2023 | 153,366 | 380,000 | 1,999,962 | — | — | — | 3,164 | 2,536,492 | | Imran Ahmad Group President | 2024 | 522,506 | — | 724,766 | 375,029 | 349,800 | — | 94,602 | 2,066,703 | | | 2023 | 442,318 | — | 902,297 | 374,919 | 521,600 | — | 451,435 | 2,692,569 | | Jai Shah Group President | 2024 | 633,984 | — | 883,883 | 461,556 | 422,500 | — | 108,289 | 2,510,212 | | | 2023 | 609,596 | — | 1,092,755 | 443,916 | 642,100 | 2,920 | 81,268 | 2,872,555 | | | 2022 | 587,256 | — | 430,070 | 429,861 | — | — | 29,300 | 1,476,487 | | Kenneth G. Cole Vice President, General Counsel and Secretary | 2024 | 604,630 | — | 784,907 | 407,980 | 376,900 | — | 102,150 | 2,276,567 | | | 2023 | 569,530 | — | 944,128 | 344,310 | 567,400 | — | 78,062 | 2,503,430 | | | 2022 | 525,081 | — | 332,100 | 331,925 | — | — | 30,500 | 1,219,606 |
2024 Summary Compensation Table
Year (column a): Information is only provided for the year(s) in which the individual served as an executive officer of our Company. Richard Westenberg and Imran Ahmad were not named executive officers in 2022. Salary (column b): Salary includes amounts voluntarily deferred by each executive officer as salary reductions under our 401(k) Savings Plan. Bonus (column c): This column reports cash and non-cash bonuses awarded outside of our incentive compensation programs. In 2023, Richard Westenberg was awarded a $950,000 cash bonus in connection with his appointment as our Vice President, Chief Financial Officer, effective October 16, 2023, of which $380,000 was paid in 2023 and the remaining $570,000 was paid in 2024. Stock Awards (column d): This column reports grants of restricted stock units for the applicable performance year and grants of PRSUs made in 2024 under our LTIP as follows:
GRANTS OF PLAN-BASED AWARDS
GRANTS OF PLAN-BASED AWARDS The following table provides information about:
GRANTS OF PLAN-BASED AWARDS
| • | the potential payouts available to our eligible executive officers under our 2024 annual performance-based cash bonus and restricted stock unit award opportunity; |
GRANTS OF PLAN-BASED AWARDS
| • | the potential payouts available to our eligible executive officers under our 2024-2026 LTIP; |
GRANTS OF PLAN-BASED AWARDS
| • | the grants of PRSUs we made in 2024 under our 2024-2026 LTIP; and |
GRANTS OF PLAN-BASED AWARDS
| • | the grants of stock options we made in 2024. |
GRANTS OF PLAN-BASED AWARDS
Our CD&A above describes our annual performance-based cash bonus and restricted stock unit award opportunities, performance targets, our LTIP and grants of stock options.
2024 Grants of Plan-Based Awards
2024 Grants of Plan-Based Awards
2024 Grants of Plan-Based Awards
| | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards | | | Estimated Future Payouts Under Equity Incentive Plan Awards | | | Estimated Future Payouts Under Equity Incentive Plan Awards | | | All Other Stock Awards: Number of Shares of Stock or Units (#) | All Other Option Awards: Number of Securities Underlying Options (a) (#) | Exercise or Base Price of Option Awards ($ Per Share) | Grant Date Fair Value of Stock and Option Awards ($) (b) | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | Threshold ($) | Target ($) | Maximum ($) | | | | | | Keith J. Allman | N/A-1 | 382,306 | 1,911,531 | 3,823,062 | | | | | | | | | | | | | 2/23/2024 | | | | — | 34,490 | 68,980 | | | | 34,490 | | | 2,584,681 | | | N/A-2 | | | | | | | 516,878 | 2,584,388 | 5,168,780 | | | | | | | 2/16/2024 | | | | | | | | | | | 103,050 | 73.16 | 2,442,903 | | Richard J. Westenberg | N/A-1 | 119,480 | 597,400 | 1,194,800 | | | | | | | | | | | | | 2/23/2024 | | | | — | 7,740 | 15,480 | | | | 7,740 | | | 580,036 | | | N/A-2 | | | | | | | 119,480 | 597,400 | 1,194,800 | | | | | | | 2/16/2024 | | | | | | | | | | | 24,470 | 73.16 | 580,086 | | Imran Ahmad | N/A-1 | 79,500 | 397,500 | 795,000 | | | | | | | | | | | | | 2/23/2024 | | | | — | 5,000 | 10,000 | | | | 5,000 | | | 374,700 | | | N/A-2 | | | | | | | 79,500 | 397,500 | 795,000 | | | | | | | 2/16/2024 | | | | | | | | | | | 15,820 | 73.16 | 375,029 | | Jai Shah | N/A-1 | 96,018 | 480,092 | 960,184 | | | | | | | | | | | | | 2/23/2024 | | | | — | 6,160 | 12,320 | | | | 6,160 | | | 461,630 | | | N/A-2 | | | | | | | 96,018 | 480,092 | 960,184 | | | | | | | 2/16/2024 | | | | | | | | | | | 19,470 | 73.16 | 461,556 | | Kenneth G. Cole | N/A-1 | 85,665 | 428,327 | 856,654 | | | | | | | | | | | | | 2/23/2024 | | | | — | 5,440 | 10,880 | | | | 5,440 | | | 407,674 | | | N/A-2 | | | | | | | 85,665 | 428,327 | 856,654 | | | | | | | 2/16/2024 | | | | | | | | | | | 17,210 | 73.16 | 407,980 |
2024 Grants of Plan-Based Awards
Estimated Future Payouts Under Non-Equity Incentive Plan Awards: The amounts that correspond to grant date “N/A-1” reflect the threshold, target, and maximum opportunities under our 2024 annual performance-based cash bonus program described in our CD&A. The resulting cash bonus payments were made in February 2025 and are reported in the 2024 Summary Compensation Table above. Estimated Future Payouts Under Equity Incentive Plan Awards:
2024 Grants of Plan-Based Awards
| • | The amounts that correspond to grant date “2/23/2024” reflect the threshold, target, and maximum opportunities under our LTIP relating to the 2024-2026 performance period. On February 23, 2024, our executive officers received grants of PRSUs under our LTIP, based on the assumption that the target award would be earned at the end of the three-year performance period. We valued the PRSUs at $74.94 per share, the closing price of our |
2024 Grants of Plan-Based Awards
| stock on February 23, 2024. The actual number of shares awarded, if any, will be determined after the three-year performance period concludes on December 31, 2026. |
2024 Grants of Plan-Based Awards
| • | The amounts that correspond to grant date “N/A-2” reflect the threshold, target and maximum opportunities for the equity portion of our 2024 annual performance program described in our CD&A. The resulting awards of RSUs were made in February 2025 and are reported in the 2024 Summary Compensation Table above. |
2024 Grants of Plan-Based Awards
All Other Option Awards (column a): These amounts reflect the number of stock options granted to each executive officer on February 16, 2024. The stock options granted vest in three equal installments over a three-year period and remain exercisable until ten years from the date of grant. Grant Date Fair Value of Stock and Option Awards (column b):
2024 Grants of Plan-Based Awards
| • | The amounts that correspond to grant date “2/23/2024” are based upon the number of PRSUs granted on February 23, 2024 under our LTIP, based on the assumption that the target award would be earned at the end of the three-year performance period. We valued the PRSUs at $74.94 per share, the closing price of our stock on February 23, 2024. The actual number of shares awarded, if any, will be determined after the three-year performance period concludes on December 31, 2026. |
2024 Grants of Plan-Based Awards
| • | The amounts that correspond to grant date “2/16/2024” reflect the grant date fair value of the stock option award on February 16, 2024, which is determined in accordance with accounting guidance. Regardless of the value placed on a stock option on the grant date, the actual value of the option will depend on the market value of our common stock at a future date when the option is exercised. |
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END We make equity grants under our 2024 Long Term Stock Incentive Plan. We refer to this plan in this proxy statement as our “Equity Plan.” The following table shows, for each executive officer as of December 31, 2024:
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
| • | vested and unvested stock options/SAR outstanding; |
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
| • | the aggregate number of unvested RSUs and phantom RSUs; |
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
| • | the market value of unvested RSUs and phantom RSUs based on the closing price of our common stock on December 31, 2024, which was $72.57 per share; |
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
| • | the aggregate number of PRSUs and phantom PRSUs granted under our 2022-2024 LTIP, 2023-2025 LTIP and 2024-2026 LTIP; and |
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
| • | the market value of those PRSUs and phantom PRSUs based on the closing price of our common stock on December 31, 2024. |
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
Our executive officers do not have voting or investment power over unvested RSUs or unexercised stock options. The value each executive officer will realize when the RSUs or phantom RSUs vest will depend on the value of our common stock on the vesting date.
2024 Outstanding Equity Awards at Fiscal Year-End
2024 Outstanding Equity Awards at Fiscal Year-End
2024 Outstanding Equity Awards at Fiscal Year-End
| | Option/SAR Awards | | | | | Stock Awards | | | | | Name | Original Grant Date (a) | Number of Securities Underlying Unexercised Options/SAR Exercisable (#) | Number of Securities Underlying Unexercised Options/SAR Unexercisable (#) | Option/ SAR Exercise Price ($) | Option/ SAR Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) (b) | Market Value of Shares or Units of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) (c) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights that Have Not Vested ($) | | Keith J. Allman | 02/08/2022 | — | 55,544 | 59.15 | 02/08/2032 | 67,940 | 4,930,406 | 125,180 | 9,084,313 | | | 02/13/2023 | — | 96,307 | 56.56 | 02/13/2033 | | | | | | | 02/16/2024 | — | 103,050 | 73.16 | 02/16/2034 | | | | | | Richard J. Westenberg | 02/16/2024 | — | 24,470 | 73.16 | 02/16/2034 | 38,080 | 2,763,466 | 7,740 | 561,692 | | Imran Ahmad | | | | | | 12,941 | 939,128 | 12,150 | 881,726 | | | 02/13/2023 | 7,390 | 14,780 | 56.56 | 02/13/2033 | | | | | | | 02/16/2024 | — | 15,820 | 73.16 | 02/16/2034 | | | | | | Jai Shah | | | | | | 13,027 | 945,369 | 22,390 | 1,624,842 | | | 02/10/2017 | 15,720 | — | 33.75 | 02/10/2027 | | | | | | | 02/09/2018 | 22,490 | — | 42.13 | 02/09/2028 | | | | | | | 02/07/2019 | 44,700 | — | 35.52 | 02/07/2029 | | | | | | | 02/11/2020 | 36,910 | — | 47.53 | 02/11/2030 | | | | | | | 02/09/2021 | 29,800 | — | 56.29 | 02/09/2031 | | | | | | | 02/08/2022 | 19,547 | 9,773 | 59.15 | 02/08/2032 | | | | | | | 02/13/2023 | 8,750 | 17,500 | 56.56 | 02/13/2033 | | | | | | | 02/16/2024 | — | 19,470 | 73.16 | 02/16/2034 | | | | |
2024 Outstanding Equity Awards at Fiscal Year-End
| | Option/SAR Awards | | | | | Stock Awards | | | | | Name | Original Grant Date (a) | Number of Securities Underlying Unexercised Options/SAR Exercisable (#) | Number of Securities Underlying Unexercised Options/SAR Unexercisable (#) | Option/ SAR Exercise Price ($) | Option/ SAR Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) (b) | Market Value of Shares or Units of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) (c) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights that Have Not Vested ($) | | Kenneth G. Cole | | | | | | 10,960 | 795,367 | 18,510 | 1,343,271 | | | 02/10/2017 | 27,790 | — | 33.75 | 02/10/2027 | | | | | | | 02/09/2018 | 24,110 | — | 42.13 | 02/09/2028 | | | | | | | 02/07/2019 | 34,470 | — | 35.52 | 02/07/2029 | | | | | | | 02/11/2020 | 29,330 | — | 47.53 | 02/11/2030 | | | | | | | 02/09/2021 | 23,680 | — | 56.29 | 02/09/2031 | | | | | | | 02/08/2022 | 15,093 | 7,547 | 59.15 | 02/08/2032 | | | | | | | 02/13/2023 | 6,787 | 13,573 | 56.56 | 02/13/2033 | | | | | | | 02/16/2024 | — | 17,210 | 73.16 | 02/16/2034 | | | | |
2024 Outstanding Equity Awards at Fiscal Year-End
Option/SAR Awards (column a): The awards reflected in this table granted prior to 2020 vest in five equal annual installments commencing in the year following the year of grant. The awards granted in and after 2020 vest in three equal annual installments commencing in the year following the year of grant. Stock Awards (column b): This column reflects unvested RSUs, which vest in three equal installments commencing in the year following the year of grant. A portion of the award amount granted to Imran Ahmad was in the form of a phantom RSU. Stock Awards (column c): This column reflects PRSUs that were granted under our 2022-2024 LTIP, 2023-2025 LTIP and 2024-2026 LTIP, as applicable. The number of PRSUs granted was based upon an assumption that the target award would be earned at the end of the three-year performance period. The actual number of shares awarded, if any, is determined after the three-year performance period concludes. The grant to Imran Ahmad under our 2023-2025 LTIP was in the form of a phantom PRSU. Richard Westenberg did not participate in our 2023-2025 LTIP or our 2022-2024 LTIP. Imran Ahmad did not participate in our 2022-2024 LTIP.
OPTION EXERCISES AND STOCK VESTED
OPTION EXERCISES AND STOCK VESTED The following table shows the number of shares acquired, and the value realized, by each of our executive officers during 2024, in connection with the exercise of stock options and the vesting of restricted stock previously awarded to each executive officer.
2024 Options Exercised and Stock Vested
2024 Options Exercised and Stock Vested
2024 Options Exercised and Stock Vested
| | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) | | Keith J. Allman | 1,211,125 | 40,902,040 | 49,383 | 6,019,793 | | Richard J. Westenberg | — | — | — | — | | Imran Ahmad (a) | — | — | — | 710,469 | | Jai Shah | 16,122 | 828,580 | 10,134 | 1,170,077 | | Kenneth G. Cole | 33,750 | 1,726,215 | 7,835 | 702,365 |
2024 Options Exercised and Stock Vested
Row (a): Imran Ahmad’s awards that vested in 2024 were phantom restricted stock units, which settled in cash.
2024 Non-Qualified Deferred Compensation
2024 Non-Qualified Deferred Compensation
Payment Upon Termination
Payment Upon Termination If a voluntary or involuntary termination of employment had occurred on December 31, 2024, our executive officers would be fully vested in the accumulated pension benefits shown in the table below. Absent an agreement for post-termination extended vesting, termination of employment would result in forfeiture to us of all unvested equity awards. Vested stock options/SAR would remain exercisable for 30 days, in the case of voluntary termination, or 90 days, in the case of involuntary termination, but not beyond the originally-specified option expiration date.
Payment Upon Termination
| Name | BRP Benefit - Defined Benefit Portion ($) | BRP Benefit - Defined Contribution Portion ($) | Total ($) | | Keith J. Allman | 98,345 | 3,164,405 | 3,262,750 | | Richard J. Westenberg | — | 66,213 | 66,213 | | Imran Ahmad | — | 86,787 | 86,787 | | Jai Shah | 29,581 | 1,083,167 | 1,112,748 | | Kenneth G. Cole | — | 671,665 | 671,665 |
CEO PAY RATIO
CEO PAY RATIO To identify our median employee for purposes of the pay ratio disclosure, we reviewed the annual base salaries for all persons who were employed by us on October 1, 2023, excluding approximately 180 employees of Sauna360 Group Oy, which we acquired in 2023, and excluding Mr. Allman, our President and CEO. We included persons employed on a full-time, part-time, seasonal or temporary basis and did not make any estimates, assumptions or adjustments to any annual base salaries. As permitted by SEC rules, the median employee for our 2024 pay ratio is the same individual we identified for our 2023 pay ratio. We calculated annual total compensation for our median employee using the same methodology we used for our executive officers as set forth in the above 2024 Summary Compensation Table. The total compensation of the median employee was $51,203, including wages, overtime pay, non-equity incentive program pay and company 401(k) match. The annual total compensation of our CEO was $10,651,821. The resulting pay ratio is 208:1. PART III — COMPENSATION OF EXECUTIVE OFFICERS
PAY VERSUS PERFORMANCE
PAY VERSUS PERFORMANCE The following table reflects compensation “actually paid” (as defined in the applicable SEC rules) to our princi pal executive officer ( PEO ) and our non-PEO executive officers. Our Compensation Committee did not consider the information provided in the table in structuring or determining compensation for our executive officers. For a complete discussion of our executive compensation program, refer to the CD&A section above.
2024 Pay Versus Performance Table
2024 Pay Versus Performance Table
2024 Pay Versus Performance Table
| Year (a) | Summary Compensation Table Total for PEO ($) | Compensation Actually Paid to PEO ($) (b) | Average Summary Compensation Table Total for Non-PEO Named Executive Officers ($) | Average Compensation Actually Paid to Non-PEO Named Executive Officers ($) (b) | Value of Initial Fixed $100 Investment Based on: | | Net Income (in millions) ($) (d) | Company Selected Measure | | | | | | | Masco Total Shareholder Return ($) | Peer Group Total Shareholder Return ($) (c) | | Operating Profit (in millions) ($) (e) | | 2024 | 10,651,821 | 13,494,503 | 2,621,620 | 2,854,454 | 151 | 108 | 822 | 1,372 | | 2023 | 12,476,381 | 17,142,621 | 2,310,266 | 2,938,306 | 150 | 123 | 908 | 1,358 | | 2022 | 6,261,228 | (7,130,941) | 1,614,199 | (1,055,881) | 102 | 104 | 844 | 1,334 | | 2021 | 13,410,774 | 30,690,004 | 3,190,993 | 6,693,250 | 150 | 147 | 410 | 1,412 | | 2020 | 14,001,941 | 18,754,175 | 3,581,869 | 4,263,007 | 116 | 120 | 1,224 | 1,306 |
2024 Pay Versus Performance Table
Year (column a): For each year listed, our PEO is Keith Allman. For 2020-2022, our non-PEO executive officers are John Sznewajs, Richard O’Reagan, Jai Shah and Kenneth Cole. For 2023, our non-PEO executive officers are Richard Westenberg, Imran Ahmad, Jai Shah, Kenneth Cole, John Sznewajs and David Chaika. For 2024, our non-PEO executive officers are Richard Westenberg, Imran Ahmad, Jai Shah and Kenneth Cole. Compensation “Actually Paid” to PEO and Average Compensation “Actually Paid” to Non-PEO executive officers (columns b): The compensation “actually paid” to our PEO and our non-PEO executive officers reflects the following adjustments from Total Compensation as reported in our Summary Compensation Table for the fiscal years 2024, 2023, 2022, 2021 and 2020:
2024 Pay Versus Performance Table
| | PEO | Average of Non-PEOs | | Total Reported in 2024 Summary Compensation Table | 10,651,821 | 2,621,620 | | Less, grant date fair value of equity awards reported in the 2024 Summary Compensation Table | (7,301,850) | (1,330,933) | | Plus, year-end fair value of equity awards granted in 2024 that are unvested and outstanding, as of 2024 year-end | 8,209,000 | 1,305,781 | | Plus, change in the fair value as of 2024 year end for equity awards granted in prior years that are unvested and outstanding | 498,206 | 111,780 | | Plus, change in fair value as of the vesting date of equity awards granted in prior year that vested during 2024 | 1,300,650 | 131,694 | | Plus, dividends earned during 2024 on unvested equity awards | 136,676 | 14,513 | | Total Adjustments | 2,842,682 | 232,834 | | Actual Compensation Paid for Fiscal Year 2024 | 13,494,503 | 2,854,454 |
Pay Versus Performance Relationships
Pay Versus Performance Relationships The following charts set forth the relationships between compensation “actually paid” to our PEO, the average of compensation “actually paid” to our non-PEO executive officers, and our cumulative TSR, Standard and Poor’s Consumer Durables & Apparel Index cumulative TSR, our annual net income and our annual operating profit over the five-year period from 2020-2024. PART III — COMPENSATION OF EXECUTIVE OFFICERS