EXHIBIT 10.2
CHAMPION INTERNATIONAL CORPORATION
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1997 INCENTIVE COMPENSATION PLAN
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1. Purposes.
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The purposes of the Plan are to attract and retain in the employ of the
Company and its subsidiaries and affiliates outstanding management employees and
to provide incentives and rewards for such employees to contribute meaningfully
to the success of the Company.
2. Definitions.
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For purposes of the Plan, the following terms shall be defined as set forth
below:
(a) "Award" means a commitment to pay incentive compensation to a Grantee
under the Plan.
(b) "Award Agreement" means any written agreement, contract or other
instrument or document evidencing an Award.
(c) "Board" means the Board of Directors of the Company.
(d) "Committee" means the Compensation and Stock Option Committee of the
Board.
(e) "Company" means Champion International Corporation, a corporation
organized under the laws of the State of New York, or any successor corporation.
(f) "Deferred Shares" means shares of Stock issuable in connection with an
Award that have been deferred pursuant to Section 5(b) hereof.
(g) "Effective Date" means March 20, 1997, the date that the Plan was
adopted by the Board.
(h)"Grantee" means a person who has been granted an Award under the Plan.
(i) "Performance Goals" means performance goals or criteria relating to (1)
the performance of the Company, including, without limitation, goals or criteria
with
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respect to financial performance, operating performance and Stock performance;
(2) the performance of any subsidiary, affiliate, division or unit of the
Company or any group of employees of the Company or any subsidiary, affiliate,
division or unit thereof; (3) the performance of any Grantee; (4) any other
performance measures selected by the Committee; and (5) any combination of the
foregoing.
(j) "Plan" means this Champion International Corporation 1997 Incentive
Compensation Plan, as amended from time to time.
(k) "Plan Year" means a calendar year.
(l) "Stock" means shares of the common stock, par value $.50 per share, of
the Company.
3. Administration.
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The Plan shall be administered by the Committee. The Committee shall have
the authority in its discretion, subject to and not inconsistent with the
express provisions of the Plan, to administer the Plan and to exercise all the
powers and authorities either specifically granted to it under the Plan or
necessary or in its judgment advisable in the administration of the Plan,
including, without limitation, the authority to grant Awards; to determine the
persons or categories of persons to whom and the time or times at which Awards
shall be granted; to determine the form of Awards; to determine the terms,
conditions, restrictions and Performance Goals relating to Awards; to determine
whether, to what extent, and under what circumstances an Award may be paid,
cancelled, forfeited, exchanged or surrendered; to make adjustments in the terms
and conditions (including Performance Goals) applicable to Awards; to construe
and interpret the Plan and the Awards; to prescribe, amend and rescind rules and
regulations relating to the Plan; and to make all other determinations deemed
necessary or in its judgment advisable for the administration of the Plan. All
determinations made by the Committee in respect of the Plan shall be final and
binding on all Grantees and their beneficiaries.
4. Eligibility
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Awards may be granted from time to time to such employees or categories of
employees of the Company and its subsidiaries and affiliates as shall be
selected by the Committee in its discretion.
5. Awards.
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(a) Grants; Performance Goals. The grant of an Award may be made at any
time prior to or simultaneously with the payment in respect of the Award.
Awards
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may be granted with respect to a Plan Year or any other shorter or longer
period that the Committee determines to be appropriate. Payment pursuant to
each Award will be contingent on the attainment of one or more Performance Goals
in respect of a performance period; or the continued employment of a Grantee
with the Company and its subsidiaries and affiliates; or any other criteria
selected by the Committee; or any combination of the foregoing. Where
applicable, the Performance Goals may be expressed in terms of attaining a
specified level of the particular criteria or a percentage increase or decrease
in the particular criteria, and may be applied to one or more of the Company, a
subsidiary, affiliate, division or unit of the Company, or any group of
employees of any of the foregoing, or may be applied to the performance of the
Company relative to a market index, a group of other companies or combination
thereof, all as determined by the Committee. With respect to any Award, the
Performance Goals may include a threshold level of performance below which no
payments will be made, levels of performance at which specified payments will be
made, and a maximum level of performance above which no additional payments will
be made. The Committee shall have the authority to make equitable adjustments
to the Performance Goals in its discretion, including, without limitation, in
recognition of unusual or non-recurring events affecting the Company or any
subsidiary, affiliate, division or unit thereof, including, without limitation,
any such events affecting the financial statements of the Company or any
subsidiary or affiliate thereof.
(b) Payments; Deferrals. Payments to be made by the Company in respect of
an Award may be made in such form as the Committee shall determine at the date
of grant or thereafter, including, without limitation, cash, Stock or other
property, and may be made in a single payment or transfer, in installments or on
a deferred basis. In this regard (1) the Committee may permit a Grantee to
defer the payment of cash, the delivery of property or the issuance of shares of
Stock in respect of any Award, subject to the Grantee exercising a valid
deferral election with the Company in accordance with procedures established by
the Committee from time to time; and (2) the Committee shall have the right to
defer the payment of cash, the delivery of property or issuance of shares of
Stock in respect of any Award until such date as the Committee shall determine
(but not later than the Grantee's termination of employment with the Company and
its subsidiaries and affiliates for any reason). Such right to defer may be
exercised by the Committee in its discretion for any reason, including as
appropriate in its judgment to preserve the tax deductibility of payments
hereunder. With respect to any mandatory deferral made pursuant to clause (2)
of this paragraph, the Committee shall notify the Grantee of any such
determination and of the respective deferral date.
If the issuance of any shares of Stock otherwise issuable pursuant to an
Award is deferred, whether pursuant to an election by a Grantee or the
determination of the Committee, the Committee may provide that such Deferred
Shares be credited with dividend equivalents during the deferral period. Any
such dividend equivalents will
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be equal to the value of cash dividends and other distributions in respect of
the Stock, and will be paid in cash, or will be converted into additional shares
of Stock the value of which will be paid in Stock, cash or other property, to
the Grantee on such date or dates as determined by the Committee.
If the payments of cash or other property otherwise payable or deliverable
pursuant to an Award is deferred, whether pursuant to an election by the Grantee
or the determination of the Committee, the Committee may provide that the
Grantee be credited with amounts in respect of such deferred Award on such basis
as the Committee deems appropriate, including, without limitation, as if the
value of such deferred Award had been invested in shares of Stock or in one or
more of the forms of investment available under the Company's Nonqualified
Supplemental Savings Plan or any successor thereto. The Committee in its
discretion may provide for elections or statements of preference by Grantees
with regard to the basis on which amounts may be credited in respect of deferred
Awards. The value of any such credited amounts will be paid to the Grantee on
such date or dates as determined by the Committee.
(c) Adjustments. In the event of any stock dividend, split-up, spin-off,
rights offering, combination or exchange of shares, recapitalization, merger,
consolidation, acquisition or disposition of property or stock, separation,
reorganization, liquidation, or the like, the number and class of any shares of
Stock or any Deferred Shares, the amount of any cash and the amount and kind of
any other property subject to any Award may be equitably adjusted, and any other
appropriate changes may be made, by the Committee, whose determinations shall be
conclusive.
(d) Termination of Award. If the employment of a Grantee terminates for
any reason while an Award is outstanding, or if any applicable Performance Goal
is not attained, the Award shall immediately terminate and be forfeited;
provided, however, that the Committee may provide, by rule or regulation or in
any Award Agreement, or may determine in any individual case, that any
conditions relating to payment in respect to an Award will be waived.
(e) Post-Termination Award. If the employment of an employee of the
Company or a subsidiary or affiliate thereof terminates for any reason during a
performance period, the Committee may in its discretion grant an Award to such
employee or, in the event of his or her death, the beneficiary of such employee
on such basis as the Committee determines.
(f) Acceleration of Payment. Anything herein to the contrary
notwithstanding, the Committee shall have authority to make a determination that
a special situation exists relating to either (1) a Grantee or (2) the Company,
including, without limitation, a change in control or potential change in
control of the Company. Upon such a determination, the Committee in its
discretion may waive any conditions relating to payment in respect of any or all
outstanding Awards (including amounts
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deferred in accordance with Section 5(b) hereof) granted to such Grantee, in the
case of clause (1) above, or to any or all Grantees, in the case of clause (2)
above. In the event of such a waiver, payment in respect of the applicable Award
or Awards (including amounts deferred in accordance with Section 5(b) hereof)
shall be made promptly by the Company.
6. General Provisions.
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(a) Nontransferability. Unless otherwise provided in an Award Agreement, Awards
shall not be transferable by a Grantee, except by will or the laws of
descent and distribution and except for the designation of a beneficiary.
(b) No Right to Continued Employment. Nothing in the Plan or in any Award or
any Award Agreement shall confer upon any Grantee the right to continue in
the employ of the Company or any subsidiary or affiliate thereof.
(c) Taxes. The Company or any subsidiary or affiliate thereof is authorized to
withhold from any Award, any payment in respect of any Award, including
from a payment in the form of Stock, or any other payments to a Grantee,
amounts of withholding and other taxes due in connection with any
transaction involving an Award, and to take such other action as the
Committee in its judgment may deem advisable to enable the Company and
Grantees to satisfy obligations for the payment of withholding taxes and
other tax obligations relating to any Award. This authority shall include
authority to withhold or receive Stock or other property and to make cash
payments in respect thereof in satisfaction of a Grantee's tax obligations.
(d) Amendment and Termination. The Plan shall take effect on the Effective
Date. The Board may at any time and from time to time alter, amend,
suspend or terminate the Plan in whole or in part. Notwithstanding the
foregoing, no amendment shall affect adversely any of the rights of any
Grantee, without such Grantee's consent, under any Award theretofore
granted under the Plan.
(e) No Rights to Awards; No Shareholder Rights. No employee of the Company or
any subsidiary or affiliate thereof shall have any claim to be granted any
Award under the Plan, and there is no obligation for uniformity of
treatment of Grantees. Except as provided specifically herein, a Grantee
or the beneficiary of a Grantee shall have no rights as a shareholder with
respect to any Stock covered by an Award until the date of the issuance of
a stock certificate for or other evidence of ownership of such Stock.
(f) Unfunded Status of Awards. The Plan is intended to constitute an
"unfunded" plan for incentive and deferred compensation. With respect to
any payments not yet made to a Grantee pursuant to an Award, nothing
contained in the
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Plan or any Award shall give any such Grantee any rights that are greater
than those of a general creditor of the Company.
(g) Shares to be Used. Shares of Stock to be used in payment of Awards may
be authorized but unissued shares, treasury shares or shares acquired for use
under the Plan. Such shares of Stock are hereby reserved for this purpose.
(h) Governing Law. The Plan and all determinations made and actions taken
pursuant hereto shall be governed by the laws of the State of New York
without giving effect to the conflict of laws principles thereof.
(i) Beneficiary. Upon death of a Grantee, all of his or her rights under
the Plan shall inure to his or her designated beneficiary or, if no beneficiary
has been designated, to his or her estate, subject to Section 5(d) hereof.
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