Exhibit 10.1 CROWN VANTAGE INC. 1995 INCENTIVE STOCK PLAN DEFERRED STOCK AWARD AGREEMENT FOR SELECTED SALARIED EMPLOYEES Crown Vantage Inc. (the "Company) hereby awards shares of Deferred Stock to the Participant named below. The terms and conditions of this award are set forth in this cover sheet, in the attached Deferred Stock Award Agreement and in the Company's 1995 Incentive Stock Plan (the "Plan"). Date of Grant: _______________________, 19__________ Name of Participant: ________________________________ Participant's Social Security Number: ______-______-______ Number of Shares Awarded: ______________ BY SIGNING THIS COVER SHEET, YOU AGREE TO ALL OF THE TERMS AND CONDITIONS DESCRIBED IN THE ATTACHED AGREEMENT AND IN THE PLAN. YOU ARE ALSO ACKNOWLEDGING RECEIPT OF THIS AGREEMENT, THE PLAN AND ITS PROSPECTUS. Participant: ____________________________________________________________ (Signature) Company: ____________________________________________________________ (Signature) Title: _______________________________________________________ Attachment - ---------- CROWN VANTAGE INC. 1995 INCENTIVE STOCK PLAN: DEFERRED STOCK AWARD AGREEMENT FOR SELECTED SALARIED EMPLOYEES AWARD OF SHARES The Company awards you the number of shares of Deferred Stock shown on the cover sheet of this Agreement. The Award is subject to the terms and conditions of this Agreement and the Plan. Your interest in the Deferred Stock may not be sold, assigned, transferred, pledged, hypothecated, or otherwise encumbered. Until the restrictions imposed by this Agreement and the Plan lapse, the Deferred Stock is forfeitable. VESTING When shares of Deferred Stock become "vested", they become nonforfeitable. Vesting will occur when the per share price of the Company Stock equals or exceeds the "Target Prices" described below. For purposes of this vesting schedule, the Target Price shall be based on the average of the Fair Market Value of the Company Stock, as adjusted, over a 20-day trading period. Target Price Vested Percentage $15 25% $20 60% $25 100% The Target Prices listed above must be equaled or exceeded on or before the close of business on the third anniversary of the date of grant listed on the cover sheet (the "Third Anniversary"). Any shares which are not vested as of that date will be forfeited. In addition, as described below, you may forfeit your right to any unvested shares if you terminate employment before these vesting requirements are satisfied. FORFEITURE If your continuous employment as an employee terminates (except as set forth below), prior to your Deferred Stock becoming fully vested, then any of your shares that you have been awarded which are not vested, will be forfeited. If, however, your employment is terminated prior to December 31, 1998 (a) by the Company for reasons other than cause: or (b) by your voluntary termination for "Good Reason" (as defined below), then your Deferred Stock shall continue to be subject to the vesting schedule set forth above until December 31, 1998. In addition, if your employment is terminated prior to the Third Anniversary (a) because of your death; (b) because of "Disability" (as defined below); or (c) because of your "Retirement" (as defined below), then your Deferred Stock will continue to be subject to the vesting schedule set forth above until the Third Anniversary. The Company determines when your continuous employment terminates for purpose of this Agreement. D E F I N I T I O N S: "Disability" for purposes of this Agreement, shall mean DISABILITY, GOOD that before the Third Anniversary, you become entitled to REASON, RETIREMENT disability benefits under the Company's Long-Term Disability Plan or under the federal Social Security Act, or that the Company determines that you are likely to qualify for one or both of these disability benefits within a reasonable time after the Third Anniversary. "Good Reason" for purposes of this Agreement, shall mean your resignation as an employee of the Company as a consequence of an unconsented to relocation of your job location which results in an increase in your one-way commute by more than 50 miles; a significant reduction in your pay and benefits; or a substantial diminution in your position, authority, duties or responsibilities provided, however, that the Company may, within 15 business days of your written notice to the Company of your intent to terminate for "Good Reason," cure the basis for such a termination. "Retirement" for purposes of this agreement shall mean termination of employment at or after age 65, or at or after age 55 if you have at least 15 years of vesting service under the Crown Vantage Inc. Retirement Plan for Salaried and Other Non-Bargaining Unit Employees. LEAVES OF ABSENCE: For purposes of this Award your service does not terminate when you go to a military leave, a sick leave or another bona fide leave of absence, if the leave was approved by the Company in writing. But your continuoux employment terminates when the approved leave ends, unless you immediately return to active work. The Company determines which leaves count for this purpose. DEFERRED STOCK The shares of Deferred Stock awarded to you are hypothetical shares of Company Stock. These Deferred Shares shall be credited to a book account in your name. No actual shares of Company Stock will be issued at the time of grant. ADJUSTMENTS In the event of a stock split, stock dividend, spin-off, stock split-up, subdivision or consolidation of shares of Company Stock or a similar change in the Company Stock, the number of shares of Deferred Stock credited to your book account and the Target Prices set forth above, will be adjusted pursuant to the Plan as determined by the Committee. The book account shall also be adjusted to take into account cash dividends that are declared on Company Stock. DISTRIBUTION You will receive a payment attributable to the Deferred FOLLOWING VESTING Stock when you become vested in that portion of the OF AWARD Deferred Stock. When payment is to be made, the Committee shall determine whether payment shall be made (a) in whole shares of Company Stock equal to the number of hypothetical whole shares of Company Stock to be distributed or (b) in a combination of whole shares of Company Stock and cash, in such proportions as the Committee deems appropriate. When a payment is made partly in cash, the hypothetical shares of Company Stock then credited to your book account shall be valued, for purposes of the payment, at the Fair Market Value of Company Stock at the time the payment is made. The Committee shall have sole discretion to determine the form of payment. RIGHTS AS You will not have any rights as a shareholder due to the SHAREHOLDER award of the Deferred Stock. WITHHOLDING TAXES No distribution shall be made to you unless you have made acceptable arrangements to pay any withholding taxes that may be due as result of this Award. RETENTION RIGHTS Neither your Award, nor this Agreement, gives you the right to be retained by the Company (or any subsidiaries) in any capacity. The Company (and any subsidiaries) reserve the right to terminate your service at any time and for any reason. BINDING EFFECT Subject to the limitations stated above and in the Plan, this Agreement shall be binding upon and inure to the benefit of your legatees, distributee, and personal representatives and the successors of the Company. ACCEPTANCE OF You may accept this Award by signing and returning the AWARD enclosed copy this Agreement. Your signature will also evidence your agreement to the terms and conditions set forth herein and to which this Award and the shares of Deferred Stock are subject. APPLICABLE LAW This agreement will be interpreted and enforced under the laws of the State of California. THE PLAN AND The text of the Crown Vantage Inc. 1995 Incentive Stock OTHER AGREEMENTS Plan is incorporated in this Agreement by reference. Capitalized terms not defined in this Agreement shall have the meanings assigned to such terms in the Plan. In the event of any conflict between the Plan and this Agreement, the terms of the Plan shall control. This Agreement and the Plan constitute the enrire understanding between you and the Company regarding this Award. Any prior agreements, commitments or negotiations concerning this Award are superseded. BY SIGNING THE COVER SHEET OF THIS AGREEMENT, YOU AGREE TO ALL OF THE TERMS AND CONDITIONS DESCRIBED ABOVE AND IN THE PLAN.