More than $400 Million in Annualized Sales to be Reconsolidated with RPM at Closing

RPM International Inc. has announced that the United States Bankruptcy Court in Delaware and the United States District Court in Delaware have confirmed the plan of reorganization for RPM’s Specialty Products Holding Corp. (SPHC) subsidiary and related entities.

SPHC originally filed for bankruptcy protection on May 31, 2010 to permanently resolve asbestos claims related to its Bondex International Inc. subsidiary. At closing of the plan of reorganization, which is expected to take place over the next several days, a trust will be established under Section 524(g) of the United States Bankruptcy Code for the benefit of current and future asbestos personal injury claimants.  The trust will assume all liability and responsibility for these current and future asbestos claims, and SPHC and its related entities will have no further liability or responsibility for, and will be permanently protected from, the claims.

At the same time, financial results of SPHC’s operating subsidiaries, which have not been included in RPM’s financial reports since the bankruptcy filing, will be reconsolidated with RPM’s results for most of the second half of the company’s fiscal year ending May 31, 2015 and subsequently.  While RPM continued to own SPHC and its subsidiaries during the bankruptcy process, their financial results were not consolidated with RPM’s during that time. RPM will review the financial impact of the reconsolidation during its second quarter earnings conference call on January 7, 2015.

“We are pleased to bring finality to our legacy Bondex asbestos liability and welcome back into the RPM family an outstanding group of SPHC operating companies that are generating more than $400 million in sales on an annualized basis, along with strong operating income and cash flow,” stated Frank C. Sullivan, RPM chairman and chief executive officer.

SPHC operating subsidiaries include:

• Chemical Specialties Manufacturing Corp., a producer of commercial cleaning products;
• Day-Glo Color Corp., a leading manufacturer of fluorescent colorants and pigments;
• Dryvit Systems, Inc., a leading manufacturer of exterior insulation finish systems;
• Kop-Coat, Inc., a leading producer of wood treatments for lumber and coatings for the marine market;
• RPM Wood Finishes Group (Mohawk Finishing Products, CCI and Guardian Protection Products, Inc.), a primary supplier of wood coatings to the furniture industry;
• TCI, Inc., a leading producer of powdered metal coatings; and
• ValvTect Petroleum Products, a producer of fuel additives.

• $450.0 million in cash at closing, funded through RPM’s revolving line of credit with a group of banks;
• $102.5 million in cash, RPM stock, or a combination of the two, on or before the second anniversary of the plan’s effective date;
• $120.0 million in cash, RPM stock, or a combination of the two, on or before the third anniversary of the plan’s effective date; and
• A final payment of $125.0 million in cash, RPM stock, or a combination of the two, on or before the fourth anniversary of the plan’s effective date.