Table of Contents AZZ INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The PSU awards in the table above are presented at the face value of the respective grants. However, the number of PSU awards that may ultimately vest can vary in a range 0% to 250% of the face amount of such awards depending on the outcome of the performance or market vesting conditions. Stock appreciation rights ("SARs") are granted with an exercise price equal to the market value of the Company's common stock on the date of grant. These awards generally have a contractual term of 7 years and vest ratably over a period of 3 years although some may vest immediately on issuance. These awards are valued using the Black-Scholes option pricing model. The Company did not grant any SARs in fiscal year 2020, 2019 or 2018. A summary of the Company’s stock appreciation rights activity is as follows for fiscal year 2020, 2019 and 2018: Stock Appreciation Rights 2020 2019 2018 SARs Weighted Average Exercise Price SARs Weighted Average Exercise Price SARs Weighted Average Exercise Price Outstanding at beginning of year 98,184 $ 44.46 148,513 $ 43.29 170,139 $ 42.02 Exercised (2,965) 44.58 (47,484) 40.84 (19,481) 31.94 Forfeited (393 ) 43.92 (2,845 ) 43.92 (2,145 ) 45.36 Outstanding at end of year 94,826 $ 44.58 98,184 $ 44.46 148,513 $ 43.29 Exercisable at end of year 94,826 $ 44.58 98,184 $ 44.46 148,513 $ 43.29 As of February 29, 2020, the average remaining contractual term for both outstanding and exercisable stock appreciation rights was 0.88 years and these awards had no intrinsic value. The following table summarizes additional information about stock appreciation rights outstanding at February 29, 2020. The Company granted each of its independent directors a total of 2,124, 1,823 and 2,040 shares of its common stock during fiscal years 2020, 2019 and 2018, respectively. These common stock grants were valued at $47.08, $54.85 and $49.00 per share for fiscal years 2020, 2019 and 2018, respectively, which was the market price of the Company's common stock on the respective grant dates. The Company also has an employee stock purchase plan, which allows employees of the Company to purchase common stock of the Company through accumulated payroll deductions. Offerings under this plan have a duration of 24 months (the "offering period"). On the first day of an offering period (the “enrollment date”) the participant is granted the option to purchase shares on each exercise date at the lower of 85% of the market value of a share of our common stock on the enrollment date or the exercise date. The participant’s right to purchase common stock under the plan is restricted to no more than $25,000 per calendar year and the participant may not purchase more than 5,000 shares during any offering period. Participants may terminate their interest in a given offering or a given exercise period by withdrawing all of their accumulated payroll deductions at any time prior to the end of the offering period. 54 Directors Grants Employee Stock Purchase Plan Range of Exercise Prices SARs Outstanding and Exercisable Average Remaining Life Weighted Average Exercise Price $39.65 - $44.15 48,061 1.00 $ 43.85 $44.72 - 46.34 46,765 0.73 $ 45.33 $39.65 - $46.34 94,826 0.88 $ 44.58