Exhibit 10.xxxvii
Amended Through
October 29, 1988
COMPOSITE
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1985 SUPPLEMENT
TO
THE MEAD CORPORATION
DEFERRED COMPENSATION PLAN FOR DIRECTORS*
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WHEREAS, The Mead Corporation Deferred Compensation Plan for Directors
("Plan") was established for compensation earned on and after January 1, 1982,
for the benefit of eligible Directors; and
WHEREAS, the Plan has been amended on prior occasions; and
WHEREAS, it is currently desirable to supplement the Plan effective August
1, 1985 (the "Effective Date").
NOW THEREFORE, with respect only to amounts on the Deferred Compensation
Ledger on the Effective Date, amounts of 1985 earned compensation for which a
deferral election is in force on the Effective Date under Plan Section 4, and
amounts of compensation deferral permitted under this Supplement, the following
provisions determine Director rights and Company obligations under the Plan. All
other provisions of the Plan, to the extent not in conflict with this
Supplement, shall continue in effect.
(1) Amounts covered under the terms of this Supplement shall, on and
after the Effective Date, be maintained in a separate record (hereinafter
referred to as the "Supplemental Ledger").
(2) Contributions of an equal percentage of each compensation payment
earned during 1986 may be made to the Plan through December 31, 1986.
Participation through compensation deferral shall include annual retainer and
meeting fees but exclude expense reimbursement.
(3) The Director shall elect, on or before September 30, 1985, that all or
a portion of his/her account in the Supplemental Ledger be distributed under
Option A or under Option B or be divided between them.
(a) OPTION A - The Director or his/her Beneficiary will receive
fifteen (15 level annuity payments from his/her account in the Supplemental
Ledger commencing on the January 2 next following his/her Termination Date
or such later January 2 as shall have been chosen by the Director, but not
later than the January 2 of the Year following the year in which he/she
becomes or would have become age 72, the date chosen by him/her being
hereafter referred to as the "Annuity Starting Date."
(b) OPTION B - Commencement, method, and duration will be the same as
under Option A, except that four (4) additional annual payments commencing
on January 3, 1993 (hereinafter referred to in the aggregate as the "Annual
Payments"), shall be paid to the Director. The Annual Payments shall reduce
the amount otherwise payable to the Director or his/her Beneficiary on
his/her Annuity Starting Date in accordance with Option A. Each annual
installment of a Director's Annual Payments shall be equal to the pro rata
amount designated for Option B of the total of (i) amounts that were in the
Deferred Compensation Ledger on the Effective Date, (ii) amounts of 1985
earned compensation for which a deferred election is in force on the
Effective Date, and (iii) amounts of compensation deferral elected under
the terms of this Supplement. Notwithstanding the foregoing, no payment of
an annual installment of a Director's Annual Payments shall be made if such
installment coincides with or follows a Director's Annuity Starting Date.
Any annual installment of a Director's Annual Payments not made in
accordance with the preceding sentence shall be included in valuing the
Supplemental Ledger in accordance with (4) below.
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*This is a composite of the 1985 Supplement to The Mead Corporation
Deferred Compensation Plan for Directors, reflecting the supplement and all
amendments adopted through October 29, 1988. The Mead Corporation Deferred
Compensation Plan for Directors is set forth in a separate document.
Except as otherwise provided, election of Option A or Option B under the
foregoing paragraph shall be irrevocable and may not be subsequently changed.
Notwithstanding the Director's election of Option A or Option B, if this
Supplement is terminated prior to, or if his/her Termination Date for reasons
other than death or disability, precedes his/her 55th birthday, distribution of
his/her account in the Supplemental Ledger shall be made in one lump sum payment
on or before the last day of the month next following the date of such
occurrence. If the Director's Termination Date occurs due to death or
disability prior to his/her 55th birthday and the value of his/her account on
such Termination Date is less than $50,000, such account shall also be so
distributed in one lump sum. If the Director dies on or after his/her Annuity
Starting Date, remaining annuity installments, if any, shall continue to be
paid from the Plan. In all cases of death, a lump sum payment or a commencement
or continuation of a level annuity shall be to the Beneficiary designated
pursuant to Section 5(d) of the Plan.
An Annuity Starting Date and/or the number of installments chosen by the
Director may be changed by the Compensation Committee, in its sole discretion,
but only, unless the Compensation Committee determines otherwise, in the event
of a severe financial hardship to the Director resulting from a sudden and
unexpected illness or accident to the Director or a dependent (as defined in
Section 152(a) of the Internal Revenue Code) of the Director, loss of the
Director's property due to casualty, or other similar extraordinary and
unforeseeable circumstances arising as a result of events beyond the control of
the Director. In the event a change made pursuant to this paragraph affects a
Director who is a member of the Compensation Committee, such Director shall not
participate in the Compensation Committee's decision. The number of installments
payable to the Participant's designated Beneficiary may be changed by the
Compensation Committee on the same basis as set forth in this paragraph.
In the event the Termination Date of a Director who has elected Option B
occurs (for reasons other than death or disability) before receipt of all the
Annual Payments to which the Director is entitled, remaining payments to which
the Director or his/her Beneficiary shall be entitled shall be calculated as if
the Director had elected Option A. If such Director shall have received one or
more but not all of the Annual Payments, his/her Supplemental Ledger account
shall be valued pursuant to (4) below as if it had been reduced on the Effective
Date by the Effective Date value of Annual Payments received (discounted at
Basic plus Option B Incremental Rate) and credited thereafter with the Basic
plus Option A Incremental Rate. In the event the Termination Date of such a
Director precedes receipt of all Annual Payments because of death or disability,
or in the event all Annual Payments are not made due to coincidence with annuity
payments on or after the Annuity Starting Date, the Director or Beneficiary
shall receive payments from the Supplemental Ledger valued at the Basic plus
Option B Incremental Rate less any Annual Payments received by the Director.
(4) Except as provided below, the Director's Supplemental Ledger account
shall be valued on the Annuity Starting Date or earlier distribution date if
applicable, according to whichever of the following (a) or (b) produces the
highest value:
(a) as if all amounts had remained in the Deferred Compensation
Ledger on the Effective Date in their separate accounts established
pursuant to Section 5(a) of the Plan and were credited pursuant to Plan
Section 5(b) in the absence of this Supplement; or
(b) by crediting the Director's Supplemental Ledger account each Year
(with pro rata adjustment for partial years) with a percentage equal to the
nine-month average composite yield on single A bonds rounded to the nearest
1/10 of 1% as published in the S&P Indexes of the Security Markets for the
first nine months of the Second Calendar Year preceding the year such
percentage is credited (hereinafter referred to as the "Basic Rate"), PLUS
a percentage (hereinafter referred to as the "Incremental Rate") based on
the Director's age on the Effective Date and his/her choice of Option A or
Option B according to the following table:
Incremental Rate
Age Option A Option B
--- -------- --------
39 and under 4% 7%
40-44 5% 8%
45-49 7% 9%
50-54 8% 10%
55-59 11% 11%
60 and over 12% --
(2)
In no event, however, shall the valuation reflect the addition of the
Incremental Rate to the Basic Rate if the Director's Termination Date (for
reasons other than death or disability) precedes his/her 55th birthday, or if
prior to his/her 55th birthday, a distribution is made to a Director due to
adverse tax or economic consequences.
(5) All level annuities paid under this Supplement shall be computed using
an interest rate percentage equal to an average of the valuation percentages
credited under (4) above during the three-year period immediately preceding the
Year in which the first annuity payment is made to a Director.
(6) Except as provided in (7) below, the Board of Directors of the Company
may amend or terminate the Plan or this Supplement as provided in Section 7 of
the Plan.
(7) Notwithstanding any other provision contained herein, in no event,
including but not limited to termination or amendment of the Plan or Supplement
or liquidation or reorganization of the Company:
(a) shall a Director who has not reached his/her 55th birthday receive
less than the amount credited to the Director's Supplemental Ledger account
with interest at the Basic Rate, or the total amounts credited to his/her
Deferred Compensation Ledger accounts as provided in (4)(a) above, if
greater;
(b) shall the Basic Rate and Incremental Rate of interest which has
been or will be credited to the account of a Director who has reached
his/her 55th birthday, or the interest rate percentage for level annuities
provided in (5) above, be changed unless the tax laws of the United States
change to increase the cost of the Incremental Rate to the Company in which
event the Incremental Rate may be adjusted only to the extent necessary to
reflect such change in cost, nor shall the rights of the Director or
Beneficiary to commence or continue distributions from the Supplemental
Ledger (including its valuation) be affected.
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1. Adopted effective August 1, 1985.
2. Amendments to Section (3) and (5) adopted effective as of October 1,
1987.
(3)
SECOND AMENDMENT
TO
1985 SUPPLEMENT TO
THE MEAD CORPORATION
DEFERRED COMPENSATION PLAN FOR DIRECTORS
WHEREAS The Mead Corporation (the "Company") heretofore established
1985 Supplement to The Mead Corporation Deferred Compensation Plan for Directors
(the "Supplement") and subsequently amended the Supplement; and
WHEREAS the Company desires to further amend the Supplement pursuant
to the power reserved to the Company's Board of Directions by Section 6 of the
Supplement;
NOW, THEREFORE, the Supplement is hereby amended, effective as of June
24, 1998, as follows:
1. The paragraph of Section 3 of the Supplement which begins with the
words "An Annuity Starting Date and/or number of installments chosen by the
Director...." is amended by the addition of the following sentence at the end
thereof:
"Notwithstanding the foregoing provisions of this paragraph, upon and after
the occurrence of a Change in Control (as defined in Section 8 hereof), the
discretionary power given the Compensation Committee to change the Annuity
Starting Date and/or the number of installments chosen by a Director shall
be exercisable in a manner which postpones the Annuity Starting Date or
postpones or reduces any installment payment only if the Compensation
Committee shall have previously received a written request from the
Director for such change and such power shall be exercisable only to
determine whether to grant the particular change requested or to retain
existing Annuity Starting Date and existing installments."
2. The Supplement is amended by the addition of the following new
Section 8:
"(8) For purposes of the Supplement, a 'Change in Control' shall be
deemed to have occurred if an event set forth in any one of the following
paragraphs shall have occurred:
"(i) date of expiration of a Tender Offer (other than an offer by
the Company), if the offeror acquires Shares pursuant to such Tender Offer;
"(ii) the date of approval by the shareholders of the Company of
a definitive agreement: (x) for the merger or consolidation of the Company
or any direct or indirect subsidiary of the Company into or with another
corporation, other than (1) a merger or consolidation which would result in
the voting securities of the Company outstanding immediately prior thereto
continuing to represent ((i) in the case of a merger or consolidation of
the Company, either by remaining outstanding or by being converted into
voting securities of the surviving entity or any parent thereof, or (ii) in
the case of a merger or consolidation of any direct or indirect subsidiary
of the Company, either by remaining outstanding if the Company continues as
a parent of the merged or consolidated subsidiary or by being converted
into voting securities of the surviving entity or any parent thereof) at
least 51% of the combined voting power of the voting securities of the
Company or such surviving or parent entity outstanding immediately after
such merger or consolidation, or (2) a merger or consolidation effected to
implement a recapitalization of the Company (or similar transaction) in
which no Person (as defined below) is or becomes the Beneficial Owner (as
defined below), directly or indirectly, of securities of the Company (not
including in the securities Beneficially Owned by such Person any
securities acquired directly from the Company or its Affiliates)
representing 25% or more of the combined voting power of the Company's then
outstanding securities, or (y) for the sale or disposition of all or
substantially all of the assets of the Company, other than a sale or
disposition by the Company of all or substantially all of the Company's
assets to an entity, at least 51% of the combined voting power of the
voting securities of which are owned (directly or indirectly) by
shareholders of the Company in substantially the same proportions as their
ownership of the Company immediately prior to such sale or disposition;
"(iii) (x) any Person is or becomes the Beneficial Owner of 25%
or more of the voting power of the then outstanding securities of the
Company (not including in the securities beneficially owned by such Person
any securities acquired directly from the Company or its affiliates),
excluding any Person who becomes such a Beneficial Owner in connection with
a transaction described in clause (x)(l) of paragraph (ii) above or (y) the
date of authorization, by both a majority of the voting power of the
Company and a
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majority of the portion of such voting power excluding the voting power of
interested Shares, of a control share acquisition (as such term is defined
in Chapter 1701 of the Ohio Revised Code); and
"(iv) a change in the composition of the Board of Directors such
that individuals who were members of the Board of Directors on the date two
years prior to such change (and any new directors (other than a director
whose initial assumption of office is in connection with an actual or
threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of the Company) who
were elected, or were nominated for election, by the Company's shareholders
with the affirmative vote of at least two-thirds of the directors then
still in office who either were directors at the beginning of such two year
period or whose election or nomination for election was previously so
approved) no longer constitute a majority of the Board of Directors.
"Notwithstanding the foregoing, a 'Change in Control' shall not be deemed
to have occurred by virtue of the consummation of any transaction or series
of integrated transactions immediately following which the record holders
of the common stock of the Company immediately prior to such transaction or
series of transactions continue to have substantially the same
proportionate ownership in an entity which owns all or substantially all of
the assets of the Company immediately following such transaction or series
of transactions.
"'Affiliate' shall have the meaning set forth in Rule 12b-2 promulgated
under Section 12 of the Exchange Act.
"'Beneficial Owner' shall have the meaning defined in Rule 13d-3 under the
Exchange Act.
"'Exchange Act' shall mean the Securities Exchange Act of 1934, as amended
from time to time.
"'Person' shall have the meaning given in Section 3(a)(9) of the Exchange
Act, as modified and used in Sections 13(d) and 14(d) thereof, except that
such term shall not include (i) the Company or any of its subsidiaries,
(ii) a trustee or other fiduciary holding securities under an employee
benefit plan of the Company or any of its Affiliates, (iii) an underwriter
temporarily holding securities pursuant to an offering of such securities,
or (iv) a corporation
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owned, directly or indirectly, by the shareholders of the Company in
substantially the same proportions as their ownership of stock of the
Company.
"'Shares' shall mean shares of common stock, without par value, of The Mead
Corporation.
"'Tender Offer' shall mean a tender offer or a request or invitation for
tenders or an exchange offer subject to regulation under Section 14(d) of
the Exchange Act and the rules and regulations thereunder, as the same may
be amended, modified or superseded from time to time."
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AMENDMENT TO
THE MEAD CORPORATION
1985 SUPPLEMENT TO THE
DEFERRED COMPENSATION PLAN FOR DIRECTORS
WHEREAS, The Mead Corporation ("Mead") established The Mead Corporation
1985 Supplement to the Deferred Compensation Plan for Directors (the "Directors'
Supplement") and subsequently amended the Directors' Supplement, and
WHEREAS, Mead desires to further amend the Supplement pursuant to the power
reserved to Mead's Compensation Committee by Section 7 of the Plan;
NOW, THEREFORE, the Supplement is hereby amended, effective as of October
26, 2001, as follows:
1. Section 3 is revised to add a new fifth paragraph to read as follows
and the current fifth paragraph becomes the sixth paragraph:
Notwithstanding any provision in the Directors' Supplement to the
contrary but subject to this Section 3, third paragraph (except as
specifically otherwise provided in this paragraph), a former or
current Director can revise the commencement date of distributions and
the number of installments (including a lump sum payment) with respect
to the amount credited to an Employee's account as follows:
(i) prior to a Change in Control, a former or current
Director may revise a previously elected commencement date and number
of installments (such revision being permitted to include receiving
all or a portion of an account in a lump sum following a Change in
Control and prior to termination of service), provided that any such
revision is effective only for distributions on or following a Change
in Control and occurring during January 2003 and thereafter and with
respect to all or a portion of the balance of such Director's account
on a Change in Control; and
(ii) at least three months prior to termination of service
as a Director (whether before or after a Change in Control), a current
Director may file such revision with respect to the balance of such
Director's account on such termination of service.
A Director can make revisions in accordance with this paragraph on a
form furnished by and filed with the person responsible for
administering the Directors' Supplement at any time prior to the dates
stated in this paragraph.