Company: TR
Filing Date: 2025-03-27
Form Type: DEF 14A
Source: 0001558370-25-003853
Chunk: 17

Company: TOOTSIE ROLL INDUSTRIES INC
Filing Date: 2025-03-27
Form: DEF 14A
Chunk 17
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4 due to changes in the tax law. In order to avoid an economic loss to the Chief Executive Officer as a result of no longer accruing benefits under those plans, the Board authorized a discretionary bonus payment of $1,177,000, in addition to the amount earned under the MIP described above,

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to replace the benefits that would otherwise have been provided under the CAP and EBP had she continued to participate in those plans.

Career Achievement Plan (CAP) and Excess Benefit Plan (EBP)

All of the named executive officers, except for the Chief Executive Officer, were eligible to receive annual CAP awards in 2024. In December 2021, the Board of Directors determined that no amounts would be awarded to the Chief Executive Officer under the CAP and EBP because the deferred payment provision under those plans would require payments to be made several years after retirement in order for them to be tax deductible to the Company. The CAP is designed to provide executive officers an incentive to achieve both short-term and long-term financial and other strategic goals of the Company and is also intended to provide an incentive for the named executive officers to remain with the Company on a long-term basis. Similar to MIP, the Board uses its discretion to determine the level of performance achieved and therefore make awards to executive officers in a fixed dollar amount based on its assessment of performance, rather than predetermined targets. Awarded amounts are credited to an unfunded bookkeeping account established on behalf of each executive officer. Participants vest in each annual award under the CAP ratably in annual 20% installments over five years until the participant reaches age 65 at which time they become fully vested in all awards provided that they are continuously employed by the Company. All distributions (other than distributions made by reason of the participant’s death), are subject to the participant entering into a non-competition and non-solicitation agreement. Payments of amounts accrued under the CAP prior to 2018 are currently intended to be exempt from the $1 million deduction limitation because they are deferred to a period later than the executive’s employment termination. A fuller description of the CAP follows the Nonqualified Deferred Compensation as of and for the Fiscal Year Ended December 31, 2024 table included below in this proxy statement.

The Board determines the CAP awards to the named executive officers based on its assessment of the Company’s performance and each named executive officer’s contribution to the Company’s long-term growth and success. In making this determination for the awards made with respect to 2024, the Board generally relied