William Runge III

About William H. Runge III

Independent director since July 2014; age 73. Chair of the Compensation Committee and member of the Audit Committee. Managing Director at Alvarez & Marsal since 2002; previously Partner-in-Charge for Arthur Andersen’s Southeast Corporate Recovery practice (1992–2002). The Board affirms his independence under NYSE standards and Company guidelines; Board held five meetings in 2024 with all directors attending over 75% of eligible meetings .

Past Roles

Organization	Role	Tenure	Committees/Impact
Alvarez & Marsal	Managing Director; served in CFO, COO, CEO, Controller roles across industries	June 2002–present	Operational transformation and performance acceleration expertise
Arthur Andersen	Partner-in-Charge, Southeast Region Corporate Recovery Practice; corporate restructuring	1992–2002	Turnaround and restructuring leadership

External Roles

Organization	Role	Tenure	Notes
Alvarez & Marsal	Managing Director	2002–present	Primary current employment

No current public company directorships disclosed; prior public boards for Runge are not listed in Mohawk’s proxy .

Board Governance

Committee assignments: Compensation (Chair); Audit (Member). Audit met 7 times in 2024; Compensation met 2 times in 2024; Governance met 2 times in 2024 .
Independence: Board determined Runge is independent under SEC and NYSE standards .
Attendance: Board held five meetings in 2024; all directors attended over 75% of eligible meetings; executive sessions held at each Board meeting as needed and presided by the Lead Independent Director (Engquist; reappointed Feb 2025) .
Board structure: Classified board; majority voting and director resignation policy in uncontested elections .

Fixed Compensation

Component	2023	2024	Notes
Annual cash retainer ($)	$120,000	$120,000	Base director retainer is $100,000 cash; Compensation Chair retainer $20,000 .
Annual equity retainer ($)	$177,174	$184,240	Standard equity retainer $165,000; 1,750 RSUs granted Jan 2, 2024 at $105.28; vests over 3 years .
Total ($)	$297,174	$304,240	—

Additional structure details:

Committee chair fees: Audit $25,000; Compensation $20,000; Governance $15,000. Lead Independent Director retainer $35,000 beginning 2025 .
Election to receive 2023 service-year cash retainer 100% in stock: 1,227 shares issued to Runge on Jan 2, 2024; fractional share cash $213.82 .

Performance Compensation

Directors receive time-vesting RSUs; no director-specific performance metrics disclosed .

As Compensation Committee Chair, Runge oversees executive pay tied to Company and segment metrics. 2024 Annual Incentive Plan goals and outcomes:

Metric	Threshold	Target	Maximum	2024 Actual*
Company Adjusted EPS ($)	7.14	9.23	10.61	9.70
Ceramic Europe Operating Income ($mm)	42	61	70	68
Flooring North America EPS ($)	0.50	1.49	1.95	1.99

*Adjustments exclude miscellaneous non-operating expenses .

Long-term equity program components (executives):

Fixed LTIP RSUs (2024 grant examples): CEO 5,373; COO 4,688; CFO 2,644; President FNA 2,998; President Global Ceramic 1,939 .
TSR component paid zero for the 2023 cycle (TSR at 10th percentile vs S&P 500), reflecting discipline; Business Unit component delivered RSUs based on 2023 goals (e.g., CEO 4,044; COO 3,528; CFO 1,327; President FNA 1,290; President Global Ceramic 8,244) .

Committee practices:

Negative discretion on bonuses; bonus pool 2024 ~$9.8mm (e.g., CEO award $1,629,419; COO $1,421,614; CFO $695,603; President FNA $1,059,561; President Global Ceramic $883,440) .
Use of independent consultant (Aon); Compensation Committee determined no conflict of interest .
Clawback policy adopted Oct 2, 2023; applies to incentive compensation upon restatement .

Other Directorships & Interlocks

Item	Status/Details
Current public company boards	None disclosed for Runge .
Compensation Committee interlocks	None; committee members were not officers/employees and no interlocks disclosed .

Expertise & Qualifications

Skills: Global Business, M&A, Finance, Sustainability, Flooring Industry knowledge, Manufacturing/Operations, Distribution/Transportation .
Background in corporate restructuring and operational turnarounds (Arthur Andersen; Alvarez & Marsal) – aligned with risk oversight and performance improvement .

Equity Ownership

Ownership Element	Amount	Date/Context
Beneficially owned common shares	9,766	As of March 15, 2024
RSUs outstanding (aggregate)	3,026	As of Dec 31, 2024
2024 Director RSU grant	1,750 RSUs at $105.28	Jan 2, 2024; vests in three equal installments
Stock ownership guideline (directors)	3x annual retainer after 5 years	All directors met requirements as of Apr 1, 2025
Hedging policy	Directors/officers prohibited from short sales and options transactions	Insider Trading Policy

No pledging or related-party transactions disclosed for Runge; pledging disclosure in 2024 proxy applied to Thiers, not Runge .

Governance Assessment

Strengths: Independent director; chairs Compensation and sits on Audit; uses performance-based frameworks (EPS, TSR, operating income) and negative discretion; strong say‑on‑pay support (89% in 2024; 95.3% average over 12 years) signaling shareholder alignment; clawback policy and anti‑hedging strengthen pay governance; attendance and executive sessions enhance oversight .
Potential weak spots or RED FLAGS:
- 2023 pay discretion: Compensation Committee approved adjusted payouts despite missed targets, which can raise pay‑for‑performance discipline concerns if repeated; context cited macro headwinds beyond management control .
- Combined CEO/Chair structure persists (mitigated by Lead Independent Director role) .
Signals to monitor: Continued use of qualitative overlays; TSR component outcomes; bonus pool sizing vs performance; equity ownership guideline compliance and any pledging/related-party updates .

Overall, Runge’s restructuring and performance-improvement background complements Audit and Compensation oversight; pay frameworks are largely performance‑tied with safeguards, but investors should watch the committee’s application of discretion in downcycles for alignment continuity .