Henry Gordon Mills

About Henry Gordon Mills

Henry G. Mills is Chief Operating Officer of Tootsie Roll Industries, appointed effective January 1, 2025; he previously served as Vice President, Business Development (appointed October 1, 2022) and earlier as Director, Business Development. He is age 36 per the FY 2024 Form 10‑K executive officers table; prior 10‑Ks list him at age 35 (FY 2023) and 34 (FY 2022) . Company performance over his tenure: revenues were $686.97m in FY 2022, $769.37m in FY 2023, and $723.22m in FY 2024; net income was $75.94m in FY 2022, $91.91m in FY 2023, and $86.83m in FY 2024 . EBITDA was $128.42m*, $135.50m*, and $134.84m* in FY 2022–2024, respectively (Values retrieved from S&P Global).

Past Roles

Fixed Compensation

• Program architecture (company-wide for executive officers): salary plus annual cash incentives under the Management Incentive Plan (MIP), participation in the Career Achievement Plan (CAP), Excess Benefit Plan (EBP), and Supplemental Savings Plan (SSP) .
• No equity-based compensation is granted (no stock options, stock appreciation rights, restricted stock or other forms of equity-based pay) as a matter of Board policy; motivation is via financial and management objectives consistent with corporate principles .

Note: Henry G. Mills was not listed among named executive officers (NEOs) in the FY 2024 or FY 2023 proxy Summary Compensation Tables; individual salary/bonus amounts for him are not disclosed .

Performance Compensation

• Most important measures used in determining executive pay (MIP and CAP): net income and EPS; increases in sales of core brands and total sales; net income as a percentage of sales. Net income is the most significant quantitatively .
• CAP plan structure and vesting:
  • Unfunded, nonqualified deferred cash awards granted annually based on performance; each award vests over 5 years at 20% per year .
  • Account returns can be linked at participant election to diversified mutual funds, Moody’s bond index, or up to 10,000 shares of Company common stock (adjusted for stock dividends) .
  • Payout mechanics: immediate lump sum of all accumulated CAP benefits upon change in control; otherwise, distributions subject to non‑competition and non‑solicitation agreements, with delays and forfeitures for cause/non‑compliance .

MIP/CAP Metrics and Weighting (program-level)

Equity Ownership & Alignment

• Beneficial ownership: Henry G. Mills filed an initial Form 3 reporting ownership of 4 shares of Common Stock (direct) as of October 1, 2022; no derivative securities were reported .
• Insider trading and hedging: Company policy prohibits directors and executive officers from engaging in transactions designed to hedge or offset declines in Company equity securities’ value (Anti‑Hedging Policy) .
• Stock ownership guidelines and pledging: No executive stock ownership guideline disclosures or pledging disclosures were identified in recent proxies; anti‑hedging is explicitly adopted .

Ownership Snapshot

Employment Terms

• Role and tenure: Appointed COO effective January 1, 2025; previously VP, Business Development effective October 1, 2022 .
• Program eligibility: Executives participate in MIP, CAP, EBP, SSP per proxy program description; no equity awards are granted .
• Change‑in‑control/severance (company practice): The Company has entered into change‑in‑control agreements with certain officers (e.g., CFO G. Howard Ember Jr. and Treasurer Barry P. Bowen). Benefits generally include a lump sum equal to a pro‑rata bonus, 3x annual base salary, and 3x the higher of last fiscal year earned bonus or the average bonus over the prior three years, plus three years of welfare benefit continuation and excise tax gross‑up, with double‑trigger protections within two years post‑CIC . Estimated CIC payments (as of year-end assumptions) illustrate the magnitude for covered officers (e.g., Ember: $5.10m severance, $63.1k benefits, $1.97m tax gross‑up in 2024) .

Note: The proxies do not list Henry G. Mills as a party to a CIC agreement; individual CIC/severance terms for him are not disclosed .

• CAP non‑compete/non‑solicit conditions: Distributions (other than death) require entering into non‑competition and non‑solicitation agreements; violations can trigger forfeitures; timing of distributions includes delays and installment options .

Performance & Track Record

Company-level financial performance during Henry Mills’ leadership tenure in Business Development and Operations:

*Values retrieved from S&P Global.

Notable governance events relevant to succession and family stewardship:

• Appointment of Karen Gordon Mills (Henry’s mother) as President and Director on June 2, 2025, with base salary eligibility and participation in MIP/EBP/CAP per 2025 proxy; she is the daughter of CEO Ellen R. Gordon and mother of COO Henry G. Mills .

Risk Indicators & Red Flags

• Hedging: Prohibited for directors and executive officers by policy; reduces misalignment risk from hedging .
• Equity selling pressure: No equity awards are granted; CAP is deferred cash with vesting and non‑compete constraints, minimizing forced equity sales dynamics .
• CIC gross‑ups: Tax gross‑up features exist for certain officers (e.g., CFO/Treasurer), which is a shareholder‑unfriendly practice; applicability to Henry Mills is not disclosed .
• Family control/related parties: Leadership and board roles include family members (CEO Ellen R. Gordon; President Karen Gordon Mills; COO Henry G. Mills), indicating concentrated control and potential related‑party considerations in succession planning .

Compensation Structure Analysis

• Increased reliance on cash and deferred cash (CAP) versus equity: Company policy eschews stock options/RSUs entirely, emphasizing MIP and CAP cash mechanisms .
• Performance metric emphasis: Net income and EPS are the primary quantitative levers for incentive payouts, with sales growth and margin (net income % of sales) also key .
• Vesting/retention: CAP’s 5‑year, 20% per year vesting and non‑compete conditions reinforce retention and reduce immediate liquidity incentives for executives .

Investment Implications

• Alignment: Absence of equity grants and anti‑hedging policy point to limited near‑term insider selling pressure; CAP’s deferred cash with market-linked returns (including the option to track up to 10,000 shares) plus non‑compete requirements fosters retention and long‑term focus .
• Pay‑for‑performance: Incentives hinge on net income, EPS, and sales growth, creating direct linkage between operating execution and annual payouts; investors should monitor these measures closely as leading indicators of bonus outcomes .
• Governance/succession: The June 2025 appointment of Karen Gordon Mills (Henry’s mother) as President alongside CEO Ellen R. Gordon reinforces family leadership continuity; while it can support stable stewardship, it also concentrates decision‑making and may reduce external pressure on compensation practices (e.g., CIC gross‑ups for certain officers) .
• Disclosure limits: Henry G. Mills is not an NEO in recent proxies; lack of disclosed individual compensation and CIC/severance terms constrains pay-for-performance assessment for him. Focus on company-level metrics and program structure until individual disclosures emerge .