EXHIBIT 10.1
Bowater Incorporated
Outside Directors’ Stock-Based Deferred Fee
Plan
1.
Purpose . The purpose of this Bowater Incorporated Outside
Directors’ Stock-Based Deferred Fee Plan (the
“Plan”) is to provide equity based compensation as a
component of the compensation of the Outside Directors of the Board
of Directors (the “Board”) of Bowater Incorporated (the
“Company”).
2.
Effective Date . The Plan shall be effective as of
May 11, 2005 (the “Effective Date” of the
Plan).
3.
Eligibility . Participation in the Plan shall be extended to
Outside Directors.
4.
Administration . The Executive Committee of the Board or
such members of the Board as are selected by the Board from time to
time (the “Committee”) shall administer the Plan,
provided that the Committee may delegate responsibility for
administration to such person or persons as it deems appropriate
from time to time. Subject to the express provisions of the Plan,
the Committee shall have the authority to do all things that it may
deem necessary or desirable in connection with the administration
of the Plan, including without limitation (a) to establish,
modify and revoke rules relating to the Plan; (b) to interpret
the terms of the Plan, any rules under the Plan and the terms and
conditions of any award or benefit under the Plan; (c) to
approve the form and content of any documentation relating to
awards or benefits under the Plan or Plan administration; and
(d) consistent with the express provisions of the Plan, to
approve, establish and amend (subject to the benefit
recipient’s consent except for amendments pursuant to
paragraph 19) the terms governing a benefit under the Plan. All
determinations, interpretations and decisions made by the Committee
under or with respect to the Plan shall be final, conclusive and
binding on the Company, and Directors and any beneficiary of a
benefit. No member of the Committee shall be liable for any action
taken in good faith with respect to the Plan.
5. Stock
Units Subject to Plan . A “Stock Unit” means the
right to receive payment in cash in an amount equal to the Fair
Market Value of one share of Stock, determined as of the
Distribution Date with respect to that Stock Unit.
6.
Deferred Retainer Benefits . Outside Directors shall be
eligible for Deferred Retainer Benefits under the Plan in
accordance with the following:
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(a)
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If
an individual is an Outside Director on the date immediately after
the date of the Company’s annual shareholders meeting (the
“Crediting Date” under this paragraph (a)), the
Deferred Retainer Account of such individual will be credited with
a Deferred Retainer Benefit of Stock Units representing shares of
Stock having a Fair Market Value of $15,000 (with such Fair Market
Value determined as of the Crediting Date).
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(b)
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If
an individual becomes an Outside Director other than on the date of
the Company’s annual shareholders meeting then, on the date
he becomes an Outside Director (the “Crediting Date”
under this paragraph (b)), the Deferred Retainer Account of such
individual will be credited with a Deferred Retainer Benefit of
Stock Units representing shares of Stock having a Fair Market Value
of $15,000 (with such Fair Market Value determined as of the
Crediting Date), provided that such $15,000 amount shall be
subject
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to a
pro-rata reduction to reflect the portion of the period during
which he was not an Outside Director between the most recent prior
annual shareholders meeting prior to his becoming an Outside
Director and the expected date of the next annual
meeting.
7.
Deferred Retainer Account . As of the Effective Date or, if
later, the date on which an individual becomes an Outside Director,
the Company shall establish a bookkeeping account in the name of
each Outside Director (the Outside Director’s “Deferred
Retainer Account”), which shall be adjusted as
follows:
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(a)
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As
of the Crediting Date with respect to the Outside Director’s
Deferred Retainer Account, such Deferred Retainer Account will be
increased to reflect the number of Stock Units to be credited as of
that date in accordance with paragraph 6.
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(b)
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With respect to dividend record
dates occurring during the period in which Stock Units are credited
to an Outside Director’s Deferred Retainer Account, such
Deferred Retainer Account will be increased to reflect dividends
payable with respect to Stock, with the Deferred Retainer Account
to be increased by the number of Stock Units equal to the number of
shares of Stock which could be purchased with the dividends payable
with respect to the Stock Units credited to the Outside
Director’s Deferred Retainer Account as of the record date
for that dividend (determined as though each Stock Unit was a share
of Stock), and based on the Fair Market Value of such stock at the
time such dividends are paid.
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(c)
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As
of the date of distribution with respect to any Stock Units in
accordance with paragraph 9, the Outside Director’s Deferred
Retainer Account will be reduced by the number of Stock Units as to
which distribution to the Outside Director is made.
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8.
Vesting .
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(a)
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Notwithstanding the provisions of
paragraph (b) below, a Director will be vested in his Deferred
Retainer Account balance on the date he ceases to be a member of
the Board if any of the following apply to him:
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(i)
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At
the time he ceases to be a member of the Board, he has completed
five years of Service in Continuous Service.
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(ii)
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He
ceases to be a member of the Board by reason of his death or
Disability.
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(iii)
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He
is a member of the Board immediately prior to a Change in Control
of the Company and is removed from or not renominated to his
directorship following such Change in Control.
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(b)
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A
Director shall forfeit his Deferred Retainer Account balance if he
is not vested in his Deferred Retainer Account balance on the date
he ceases to be a member of the Board.
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9.
Distributions . As soon as practicable after a
Director’s Distribution Date, he shall receive a lump sum
cash payment in settlement of the vested balance in his Deferred
Retainer Account as of such Distribution Date. The amount of such
cash payment shall equal the Fair
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Market Value of Stock represented
by such Stock Units, with such value determined as of the
Director’s Distribution Date. As of the Director’s
Distribution Date, and except as otherwise expressly provided in
this Plan, the Director shall receive no payment with respect to
his Deferred Retainer Account balance if he is not vested on the
Distribution Date, and such balance shall be forfeited. A
Director’s “Distribution Date” shall be the first
day on which he ceases to be in Service.
10.
Adjustments . In the event of any stock dividend, stock
split, combination or exchange of shares, merger, consolidation,
spinoff or other distribution (other than normal cash dividends) of
Company assets to shareholders or any other change affe
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