Exhibit 10.3
RPM INTERNATIONAL INC.
INDEMNIFICATION AGREEMENT FOR DIRECTORS, OFFICERS AND KEY
EMPLOYEES OF SPECIALTY PRODUCTS HOLDING CORP.
          THIS AGREEMENT is made, effective as of the 31st day of May, 2010, by
and between RPM International Inc., a Delaware corporation (the “Corporation”),
and Stephen J. Knoop (“Indemnitee”).
          WHEREAS, it is essential to the Corporation to retain and attract as
Directors, Officers and key employees the most capable persons available, such
as Indemnitee;
          WHEREAS, the prevalence of corporate litigation subjects directors and
officers to expensive litigation risks and it is the policy of the Corporation
to indemnify its Directors and/or Officers so as to provide them with the
maximum possible protection permitted by law;
          WHEREAS, due to the decision of the Corporation’s Specialty Products
Holding Corp. subsidiary (“SPHC”) and its subsidiaries to file for
reorganization under chapter 11 of the Bankruptcy Code, the Board of Directors
deems it advisable to extend this indemnification policy to individuals who will
serve as Directors and/or Officers of SPHC and its subsidiaries, as well as to
certain employees of SPHC and/or its subsidiaries as determined by the Board of
Directors (“Key Employees”);
          WHEREAS, in addition, because the statutory indemnification provisions
of the Delaware General Corporation Law (the “DGCL”) expressly provide that they
are non-exclusive, it is the policy of the Corporation to indemnify Directors
and Officers of the Corporation who have, on behalf of the Corporation, entered
into settlements of derivative suits provided they have not breached the
applicable statutory standard of conduct;
          WHEREAS, due to the decision of SPHC and its subsidiaries to file for
reorganization under Chapter 11 of the Bankruptcy Code, the Board of Directors
deems it appropriate to extend this policy to individuals who will serve as
Directors, Officers or Key Employees of SPHC and/or any of its subsidiaries;
          WHEREAS, Indemnitee does not regard the protection available under the
Corporation’s Amended and Restated By-laws (the “By-laws”), the corresponding
charter documents of SPHC and its subsidiaries, and insurance, if any, as
adequate in the present circumstances, and considers it necessary and desirable
to his or her service to have adequate protection, and the Corporation desires
to provide such protection to induce Indemnitee to serve in such capacity;
          WHEREAS, on or prior to the date hereof, Indemnitee began serving as a
Director, Officer or Key Employee of SPHC and/or one or more of its
subsidiaries, and the Corporation desires to protect Indemnitee for any and all
service in such capacity; and
          WHEREAS, the DGCL provides that indemnification of directors, officers
and employees of a corporation may be authorized by agreement, and thereby
contemplates that contracts of this nature may be entered into between the
Corporation and Indemnitee;

 

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          NOW, THEREFORE, for good and valuable consideration, the adequacy of
which is hereby acknowledged, the Corporation and Indemnitee do hereby agree as
follows:
          1. Agreement to Serve. Indemnitee agrees to serve or continue to serve
as a Director and/or Officer of the Corporation and/or a Director, Officer or
Key Employee of SPHC and/or one or more of its subsidiaries for so long as he or
she is duly elected or appointed or until such time as he or she tenders his or
her resignation in writing or is otherwise terminated or properly removed from
office.
          The Corporation expressly confirms and agrees that it has entered into
this agreement and assumed the obligations imposed on the Corporation hereby in
order to induce Indemnitee to continue to serve as a Director and/or Officer of
the Corporation and a Director, Officer or Key Employee of SPHC and/or one or
more of its subsidiaries, and the Corporation acknowledges that Indemnitee is
relying upon this agreement in continuing in such capacity.
          2. Definitions. As used in this Agreement:
          (a) The term “Proceeding” shall include any threatened, pending, or
completed action, suit, arbitration or proceeding, whether brought by or in the
right of the Corporation or otherwise and whether of a civil, criminal,
administrative or investigative nature, in which Indemnitee may be or may have
been involved as a party or otherwise, by reason of the fact that Indemnitee is
or was a Director and/or Officer of the Corporation or a Director, Officer or
Key Employee of any subsidiary of the Corporation, by reason of any action taken
by Indemnitee or of any inaction on his or her part while acting in such
capacity, or by reason of the fact that he or she is or was serving at the
request of the Corporation as a director, officer, member or manager, partner,
trustee, employee, agent, or fiduciary of another corporation, domestic or
foreign, nonprofit or for profit, a limited liability company or a partnership,
joint venture, trust or other enterprise; in each case whether or not he or she
is acting or serving in any such capacity at the time any liability or expense
is incurred for which indemnification or reimbursement can be provided under
this Agreement.
          (b) The term “Expenses” shall include, without limitation, expenses of
investigations, judicial or administrative proceedings or appeals, attorneys’
fees and disbursements and any expenses of establishing a right to
indemnification under Paragraph 8 of this Agreement, but shall not include the
amount of judgments, fines or penalties against or settlements paid by
Indemnitee.
          (c) References to “other enterprise” shall include, without
limitation, employee benefit plans; references to “fines” shall include, without
limitation, any excise tax assessed with respect to any employee benefit plan;
references to “serving at the request of the Corporation” shall include, without
limitation, any service as a Director and/or Officer of the Corporation which
imposes duties on, or involves services by, such Director and/or Officer with
respect to an employee benefit plan, its participants or beneficiaries; and a
person who acted in good faith and in a manner he or she reasonably believed to
be in the best interests of the participants and beneficiaries of an employee
benefit plan shall be deemed to have acted in a manner “not opposed to the best
interests of the Corporation” as referred to in this Agreement.

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          (d) Indemnitee shall be deemed to have acted in a manner “in or not
opposed to the best interests of the Corporation” as referred to in this
Agreement with respect to any service as a Director, Officer or Key Employee of
SPHC or any of its subsidiaries if such person acted in good faith and in a
manner he or she reasonably believed to be in or not opposed to the best
interests of SPHC or its subsidiaries or if such action was otherwise required
by the Bankruptcy Court.
          3. Indemnity in Third-Party Proceedings. The Corporation shall
indemnify Indemnitee in accordance with the provisions of this Paragraph 3 if
Indemnitee is a party to or threatened to be made a party to or otherwise
involved in any Proceeding (other than a Proceeding by or in the right of the
Corporation to procure a judgment in its favor) by reason of the fact that
Indemnitee is or was a Director and/or Officer of the Corporation or a Director,
Officer or Key Employee of a subsidiary of the Corporation, or is or was serving
at the request of the Corporation as a director, officer, member or manager,
partner, trustee, employee, agent, or fiduciary of another corporation, domestic
or foreign, nonprofit or for profit, a limited liability company or a
partnership, joint venture, trust or other enterprise, against all Expenses,
judgments, settlements, fines and penalties, actually and reasonably incurred by
Indemnitee in connection with the defense or settlement of such Proceeding, but
only if Indemnitee acted in good faith and in a manner which he or she
reasonably believed to be in or not opposed to the best interests of the
Corporation and, in the case of a criminal proceeding, had no reasonable cause
to believe that his or her conduct was unlawful. The termination of any such
Proceeding by judgment, order of court, settlement, conviction or upon a plea of
nolo contendere, or its equivalent, shall not, of itself, create a presumption
that Indemnitee did not act in good faith and in a manner which he or she
reasonably believed to be in or not opposed to the best interests of the
Corporation, and with respect to any criminal proceeding, that such person had
reasonable cause to believe that his or her conduct was unlawful.
          4. Indemnity for Expenses in Proceedings by or in the Right of the
Corporation. The Corporation shall indemnify Indemnitee in accordance with the
provisions of this Paragraph 4 if Indemnitee is a party to or threatened to be
made a party to any Proceeding by or in the right of the Corporation to procure
a judgment in its favor by reason of the fact that Indemnitee is or was a
Director and/or Officer of the Corporation or a Director, Officer or Key
Employee of a subsidiary of the Corporation, or is or was serving at the request
of the Corporation as a director, officer, member or manager, partner, trustee,
employee, agent, or fiduciary of another corporation, domestic or foreign,
nonprofit or for profit, a limited liability company or a partnership, joint
venture, trust or other enterprise, against all Expenses actually and reasonably
incurred by Indemnitee in connection with the defense of such Proceeding, but
only if he or she acted in good faith and in a manner which he or she reasonably
believed to be in or not opposed to the best interests of the Corporation,
except that no indemnification for Expenses shall be made under this Paragraph 4
in respect of any claim, issue or matter as to which Indemnitee shall have been
adjudged by court order or judgment to be liable to the Corporation, unless and
only to the extent that any court in which such Proceeding was brought shall
determine upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, Indemnitee is fairly and reasonably
entitled to indemnity for such expenses as such court shall deem proper.
          5. Indemnity for Amounts Paid in Settlement in Proceedings by or in
the Right of the Corporation. The Corporation shall indemnify Indemnitee in
accordance with the provisions of this Paragraph 5 if Indemnitee is a party to
or threatened to be made a party to any Proceeding by or in the right of the
Corporation to procure a judgment in its favor by reason of the fact that

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Indemnitee is or was a Director and/or Officer of the Corporation or a Director,
Officer or Key Employee of a subsidiary of the Corporation, or is or was serving
at the request of the Corporation as a director, officer, member or manager,
partner, trustee, employee, agent, or fiduciary of another corporation, domestic
or foreign, nonprofit or for profit, a limited liability company or a
partnership, joint venture, trust or other enterprise, against all amounts
actually and reasonably paid in settlement by Indemnitee in connection with any
such Proceeding, but only if he or she acted in good faith and in a manner which
he or she reasonably believed to be in or not opposed to the best interests of
the Corporation.
          6. Indemnification of Expenses of Successful Party. Notwithstanding
any other provision of this Agreement, to the extent that Indemnitee has been
successful on the merits or otherwise in defense of any Proceeding or in defense
of any claim, issue or matter therein, including dismissal without prejudice,
Indemnitee shall be indemnified against all Expenses incurred in connection
therewith.
          7. Advances of Expenses. Any Expenses incurred by or on behalf of
Indemnitee pursuant to Paragraphs 3 or 4 in any Proceeding shall be paid by the
Corporation in advance upon the written request of Indemnitee if Indemnitee
shall undertake to (a) repay such amount to the extent that it is ultimately
determined that Indemnitee is not entitled to indemnification hereunder, and (b)
reasonably cooperate with the Corporation concerning the action, suit or
proceeding giving rise to the Expenses. Any advances to be made under this
Paragraph 7 shall be paid by the Corporation to Indemnitee within 30 days
following delivery of a written request therefor by Indemnitee to the
Corporation.
          8. Procedure. Any indemnification and advances provided for in
Paragraph 3, 4, 5 and 6 shall be made no later than 30 days after receipt of the
written request of Indemnitee. If a claim under this Agreement, under any
statute, or under any provision of the Corporation’s Amended and Restated
Certificate of Incorporation (the “Certificate”) or Amended and Restated By-laws
(the “By-laws”) or the corresponding charter documents of SPHC or any of its
subsidiaries providing for indemnification, is not paid in full by the
Corporation within 30 days after a written request for payment thereof has first
been received by the Corporation, Indemnitee may, but need not, at any time
thereafter bring an action against the Corporation to recover the unpaid amount
of the claim and, subject to the other provisions of this Agreement, Indemnitee
shall also be entitled to be paid for the Expenses of bringing such action. It
shall be a defense to any such action (other than an action brought to enforce a
claim for expenses incurred in connection with any action, suit or proceeding in
advance of its final disposition) that Indemnitee has not met the standards of
conduct which make it permissible under applicable law for the Corporation to
indemnify Indemnitee for the amount claimed, but the burden of proving such
defense shall be on the Corporation and Indemnitee shall be entitled to receive
advance payments of expenses pursuant to Paragraph 7 hereof unless and until
such defense may be finally adjudicated by court order or judgment from which no
further right of appeal exists. It is the parties’ intention that if the
Corporation contests Indemnitee’s right to indemnification, the question of
Indemnitee’s right to indemnification shall be for the court or arbitrator, as
applicable, to decide, and neither the failure of the Corporation (including its
Board of Directors, any committee or subgroup of the Board of Directors,
independent legal counsel or its stockholders) to have made a determination that
indemnification of Indemnitee is proper in the circumstances because Indemnitee
has met the applicable standard of conduct required by applicable law, nor an
actual determination by the Corporation (including its Board of Directors, any
committee or subgroup of the Board of Directors, independent legal counsel, or
its stockholders) that Indemnitee

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has not met such applicable standard of conduct, shall create a presumption that
Indemnitee has or has not met the applicable standard of conduct.
          9. Allowance for Compliance with SEC Requirements. Indemnitee
acknowledges that the Securities and Exchange Commission (“SEC”) has expressed
the opinion that indemnification of directors and officers from liabilities
under the Securities Act of 1933 (“Act”), as amended, is against public policy
as expressed in the Act and, is therefore, unenforceable. Indemnitee hereby
agrees that it will not be a breach of this Agreement for the Corporation to
undertake with the SEC in connection with the registration for sale of any stock
or other securities of the Corporation from time to time that, in the event a
claim for indemnification against such liabilities (other than the payment by
the Corporation of expenses incurred or paid by a director or officer of the
Corporation in the successful defense of any action, suit or proceeding) is
asserted in connection with such stock or other securities being registered, the
Corporation will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of competent jurisdiction on
the question of whether or not such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue. Indemnitee further agrees that such submission to a court of
competent jurisdiction shall not be a breach of this Agreement.
          10. Indemnification Hereunder Not Exclusive. The indemnification
provided by this Agreement shall not be deemed exclusive of any other rights to
which Indemnitee may be entitled under the Certificate or the By-laws of the
Corporation, the corresponding charter documents of SPHC or any of its
subsidiaries, any agreement, any vote of stockholders or disinterested
directors, the General Corporation Law of the State of Delaware, or otherwise,
both as to action in his or her official capacity and as to action in another
capacity while holding such office.
          The indemnification under this Agreement for any action taken or not
taken while serving in an indemnified capacity shall continue as to Indemnitee
even though he or she may have ceased to be a Director and/or Officer of the
Corporation or a Director, Officer or Key Employee of SPHC and/or any of its
subsidiaries and shall inure to the benefit of the heirs, executors and personal
representatives of Indemnitee.
          11. Partial Indemnification. If Indemnitee is entitled under any
provision of this Agreement to indemnification by the Corporation for some
claims, issues or matters, but not as to other claims, issues or matters, or for
some or a portion of the Expenses, judgments, fines or penalties actually and
reasonably incurred by Indemnitee or amounts actually and reasonably paid in
settlement by Indemnitee in the investigation, defense, appeal or settlement of
any Proceeding, but not for the total amount thereof, the Corporation shall
nevertheless indemnify Indemnitee for the portion of such claims, issues or
matters or Expenses, judgments, fines, penalties or amounts paid in settlement
to which Indemnitee is entitled.
          12. No Rights of Continued Employment. Nothing contained in this
Agreement is intended to create in Indemnitee any right to continued employment.
          13. Reimbursement to Corporation by Indemnitee; Limitation on Amounts
Paid by Corporation. To the extent Indemnitee has been indemnified by the
Corporation hereunder and later receives payments from any insurance carrier
covering the same Expenses, judgments, fines, penalties or amounts paid in
settlement so indemnified by the Corporation hereunder, Indemnitee

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shall immediately reimburse the Corporation hereunder for all such amounts
received from the insurer.
          Notwithstanding anything contained herein to the contrary, Indemnitee
shall not be entitled to recover amounts under this Agreement which, when added
to the amount of indemnification payments made to, or on behalf of, Indemnitee,
under the Certificate or By-laws of the Corporation, in the aggregate exceed the
Expenses, judgments, fines, penalties and amounts paid in settlement actually
and reasonably incurred by Indemnitee (“Excess Amounts”). To the extent the
Corporation has paid Excess Amounts to Indemnitee, Indemnitee shall be obligated
to reimburse the Corporation for such Excess Amounts.
          Notwithstanding anything contained herein to the contrary, the
Corporation shall not be obligated under the terms of this Agreement, to
indemnify Indemnitee:
          (a) or advance expenses to Indemnitee with respect to proceedings or
claims initiated or brought voluntarily by Indemnitee and not by way of defense,
except with respect to Proceedings brought to establish or enforce a right to
indemnification under this Agreement or any other statute or law or otherwise as
required under Section 145 of the DGCL, but such indemnification or advancement
of expenses may be provided by the Corporation in specific cases if the Board of
Directors finds it appropriate;
          (b) if it is proved by final judgment in a court of law or other final
adjudication to have been based upon or attributable to the Indemnitee’s in fact
having gained any personal profit or advantage to which he or she was not
legally entitled;
          (c) for any expenses incurred by Indemnitee with respect to any
proceeding instituted by Indemnitee to enforce or interpret this Agreement, if a
court of competent jurisdiction determines that each of the material assertions
made by Indemnitee in such proceeding was not made in good faith or was
frivolous;
          (d) for a disgorgement of profits made from the purchase and sale by
Indemnitee of securities pursuant to Section 16(b) of the Securities Exchange
Act of 1934, as amended, or similar provisions of any state statutory law or
common law; or
          (e) for any judgment, fine or penalty which the Corporation is
prohibited by applicable law from paying as indemnity or for any other reason.
          14. Scope. Notwithstanding any other provision of this Agreement, the
Corporation hereby agrees to indemnify the Indemnitee to the fullest extent
permitted by law, notwithstanding that such indemnification is not specifically
authorized by the other provisions of this Agreement, the Corporation’s
Certificate, the By-laws, or by statute. In the event of any change, after the
date of this Agreement, in any applicable law, statute, or rule which expands
the right of a Delaware corporation to indemnify a member of its board of
directors or an officer, such change shall be deemed to be within the purview of
the Indemnitee’s rights and the Corporation’s obligations under this Agreement.
In the event of any change in any applicable law, statute or rule which narrows
the right of a Delaware corporation to indemnify a member of its board of
directors or an officer, such change, to the extent not otherwise required by
such law, statute or rule to be applied to this Agreement, shall have no effect
on this Agreement or the parties’ rights and obligations hereunder.

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          15. Notice to Insurers. If, at the time of the receipt of a written
request of Indemnitee pursuant to Paragraph 8 hereof, the Corporation has
director and officer liability insurance in effect, the Corporation shall give
prompt notice of the commencement of such proceeding to the insurers in
accordance with the procedures set forth in the respective policies. The
Corporation shall thereafter take all necessary or desirable action to cause
such insurers to pay, on behalf of the Indemnitee, all amounts payable as a
result of such proceeding in accordance with the terms of such policies.
          16. Selection of Counsel. In the event the Corporation shall be
obligated under Paragraphs 3, 4, 5, or 6 hereof to pay the expenses of any
Proceeding against Indemnitee, the Corporation, if appropriate, shall be
entitled to assume the defense of such Proceeding, with counsel approved by
Indemnitee, which approval shall not be unreasonably withheld or delayed, upon
delivery to Indemnitee of written notice of the Corporation’s election to do so.
After delivery of such notice, approval of such counsel by Indemnitee and the
retention of such counsel by the Corporation, the Corporation will not be liable
to Indemnitee under this Agreement for any fees of counsel subsequently incurred
by Indemnitee with respect to the same proceeding, provided that: (a) Indemnitee
shall have the right to employ his or her own counsel in any such proceeding at
Indemnitee’s expense; and (b) if (i) the employment of counsel by Indemnitee has
been previously authorized by the Corporation, or (ii) the Corporation shall
not, in fact, have employed counsel to assume the defense of such proceeding,
then the fees and expenses of Indemnitee’s counsel shall be at the expense of
the Corporation.
          17. Arbitration. With the exception of the provisions of Paragraph 9
hereof, any dispute, controversy or claim between Indemnitee and the Corporation
arising out of or relating to or concerning the provisions of this Agreement,
shall be finally settled by arbitration in the City of Cleveland, State of Ohio,
before a single arbitrator agreeable to both parties. If the parties cannot
agree on a designated arbitrator, arbitration shall proceed in the City of
Cleveland, State of Ohio, before an arbitrator appointed by the American
Arbitration Association (the “AAA”). In either case, the arbitration proceeding
shall commence promptly in accordance with the commercial arbitration rules of
the AAA then in effect and the arbitrator shall be an attorney other than an
attorney who has, or is associated with a firm having associated with it an
attorney who has been retained by or performed services for the Corporation or
Indemnitee at any time during the five years preceding the commencement of the
arbitration. The award shall be rendered in such form that judgment may be
entered thereon in any court having jurisdiction thereof.
          18. Continuation of Rights and Obligations. All rights and obligations
of the Corporation and Indemnitee hereunder shall continue in full force and
effect despite the subsequent amendment or modification of the Corporation’s
Certificate or By-Laws, as such are in effect on the date hereof, and such
rights and obligations shall not be affected by any such amendment or
modification, any resolution of directors or stockholders of the Corporation, or
by any other corporate action which conflicts with or purports to amend, modify,
limit or eliminate any of the rights or obligations of the Corporation and/or
Indemnitee hereunder.
          19. Amendment and Modification. This Agreement may only be amended,
modified or supplemented by the written agreement of the Corporation and
Indemnitee.
          20. Assignment. This Agreement shall not be assigned by the
Corporation or Indemnitee without the prior written consent of the other party
thereto, except that the Corporation may freely assign its rights and
obligations under this Agreement to any subsidiary for whom

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Indemnitee is serving as a director and/or officer thereof; provided, however,
that no permitted assignment shall release the assignor from its obligations
hereunder. Subject to the foregoing, this Agreement and all of the provisions
hereof shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns, including, without limitation, any
successor to the Corporation by way of merger, consolidation and/or sale or
disposition of all or substantially all of the capital stock of the Corporation.
          21. Saving Clause. If this Agreement or any portion thereof shall be
invalidated on any ground by any court of competent jurisdiction, the
Corporation shall nevertheless indemnify Indemnitee as to Expenses, judgments,
fines, penalties and amounts paid in settlement with respect to any Proceeding
to the full extent permitted by any applicable portion of this Agreement that
shall not have been invalidated or by any other applicable law.
          22. Counterparts. This Agreement may be executed in two or more fully
or partially executed counterparts each of which shall be deemed an original
binding the signer thereof against the other signing parties, but all
counterparts together shall constitute one and the same instrument. Executed
signature pages may be removed from counterpart agreements and attached to one
or more fully executed copies of this Agreement. The parties may execute and
deliver this Agreement by facsimile signature, which shall have the same binding
effect as an original ink signature.
          23. Notice. Indemnitee shall, as a condition precedent to his or her
right to be indemnified under this Agreement, give to the Corporation notice in
writing as soon as practicable of any claim made against him or her for which
indemnity will or could be sought under this Agreement. Notice to the
Corporation shall be directed to the Corporation at P.O. Box 777, 2628 Pearl
Road, Medina, Ohio 44258, Attention: General Counsel (or such other address as
the Corporation shall designate in writing to Indemnitee). Notice shall be
deemed received three days after the date postmarked if sent by prepaid mail,
properly addressed. In addition, Indemnitee shall give the Corporation such
information and cooperation as it may reasonably require within Indemnitee’s
power.
          24. Applicable Law. All matters with respect to this Agreement,
including, without limitation, matters of validity, construction, effect and
performance shall be governed by the internal laws of the State of Delaware
applicable to contracts made and to be performed therein between the residents
thereof (regardless of the laws that might otherwise be applicable under
principles of conflicts of law).
[Signature Page Follows]

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     IN WITNESS WHEREOF, the parties hereby have caused this Agreement to be
duly executed and signed as of the day and year first above written.

            RPM INTERNATIONAL INC.

          THE “CORPORATION”
      By:   /s/ Frank C. Sullivan       Frank C. Sullivan        Chairman and
Chief Executive Officer        “INDEMNITEE”
      /s/ Stephen J. Knoop         Stephen J. Knoop             

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