Exhibit 10.7
SCHWEITZER-MAUDUIT INTERNATIONAL,
INC.
LONG-TERM INCENTIVE
PLAN
First Amendment and
Restatement
Effective as of January 1, 2009
RECITALS:
WHEREAS , the Corporation
adopted a Long-Term Incentive Plan (LTIP) in 2001 to provide a
long-term incentive opportunity to its participants;
WHEREAS, the LTIP is intended to
provide incentive compensation that is qualified as exempt from the
limitation on tax deductibility when paid to a participant that is
covered by Section 162(m) of the Internal Revenue
Code;
WHEREAS, Revenue Ruling 2008-13
issued new guidance from the Internal Revenue Service on its
revised interpretation of the performance based compensation
exemption from Code Section 162(m) limits on deductible
compensation;
WHEREAS, the Company desires to
maintain the exempt performance based compensation status of any
awards issued to a participant in the LTIP that is also a Covered
Person, as hereinafter defined, and therefore amends and restates
the plan as follows.
1.
PURPOSE
The purpose of this Long-Term
Incentive Plan (the “Plan”) of Schweitzer-Mauduit
International, Inc. (the “Company”) is to promote
the long-term financial success of the Company by:
(a) attracting and retaining
executive personnel of outstanding ability;
(b) strengthening the
Company’s capability to develop, maintain and direct a
competent management team; and
(c) motivating executive
personnel by means of performance-related incentives to achieve
longer-range performance goals.
2.
EFFECTIVE DATE
The Plan is adopted effective as of
January 1, 2001.
3.
DEFINITIONS
“Affiliate” means any company in which the Company owns 20%
or more of the equity interest (collectively, the
“Affiliates”).
“Board”
means the Board of Directors of the
Company.
“Change of
Control” shall mean
the date as of which: (a) a third person, including a
“group” as defined in Section 13(d)(3) of the
Exchange Act of 1934, acquires actual or beneficial ownership of
shares of the Company having 15% or more of the total number of
votes that may be cast for the election of Directors of the
Company; or (b) as the result of any cash tender or exchange
offer, merger or other business combination, sale of assets or
contested election, or any combination of the foregoing
transactions (a “Transaction”), the persons who were
directors of the Company before the Transaction shall cease to
constitute a majority of the Board of Directors of the Company or
any successor to the Company.
“Code”
means the Internal Revenue Code of
1986, as amended, and the regulations thereunder, as amended from
time to time.
“Committee” means the Compensation Committee of the
Board. The Committee shall administer the Plan.
“Covered Employee”
shall have the meaning given to such term by Internal Revenue Code
Section 162(m)(3), and any sucessor provision.
“Exchange
Act” means the
Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder, as amended from time to time.
“Participant”
means an officer or employee who the
Committee selects to participate in this Plan (collectively, the
“Participants”) in accordance with Section 5 of
this Plan. Participant’s shall be listed on Addendum A
hereto, as it may be amended from time to time.
“Potential Change of
Control” shall mean
the date as of which: (a) the Company enters into an agreement
the consummation of which, or the approval by shareholders of
which, would constitute a Change of Control; (b) proxies for
the election of Directors of the Company are solicited by anyone
other than the Company; (c) any person (including, but not
limited to, any individual, partnership, joint venture,
corporation, association or trust) publicly announces an intention
to take or to consider taking actions which, if consummated, would
constitute a Change of Control; or (d) any other event occurs
which is deemed to be a Potential Change of Control by the Board
and the Board adopts a resolution to the effect that a Potential
Change of Control has occurred.
“Performance
Cycle” or “
Cycle” means each three-year period, as determined by
the Committee, during which the performance of the Company is
measured for the purposes of
determining the extent to which the Performance
Awards which have been contingently allotted for such Cycle may be
earned. The term shall include any year within a Cycle when the
Committee has established Performance Goals and the related
Performance Award opportunities for the individual years that
comprise a Cycle.
“Performance
Goals” means the
objectives for the Company established by the Committee for a
Performance Cycle, for the purpose of determining the extent to
which Performance Awards which have been contingently allotted for
such Cycle are earned.
“Performance
Award” means the
units contingently earned during a Performance Cycle by
Participants under this Plan.
“Retirement” and “Retire” means the
termination of employment on or after the date the Participant is
entitled to receive immediate payments under a qualified retirement
plan of the Company or an Affiliate; provided, however, if the
Participant is not eligible to participate under a qualified
retirement plan of the Company or its Affiliates then such
Participant shall be deemed to have retired if his termination of
employment is on or after the date such Participant has attained
age 55.
“Threshold” means the minimum level of performance in
relation to the Performance Goals for which any Performance Award
may be earned.
“Total and Permanent
Disability” means a
condition arising out of injury or disease which the
Schweitzer-Mauduit International, Inc. Human Resources
Committee determines is permanent and prevents a Participant from
engaging in any occupation with his Employer commensurate with his
education, training and experience, excluding (i) any
condition incurred in military service (other than temporary
absence on military leave) if the Participant’s service is
not resumed at the end of his military service, (ii) any
condition incurred as a result of or incidental to a felonious act
perpetrated by the Participant, and (iii) any condition
resulting from excessive use of drugs or narcotics or use of
illegal drugs or (iv) from willful self-inflicted
injury.
4.
ADMINISTRATION
The Plan shall be administered by
the Committee, which in its absolute discretion, shall have the
power to interpret and construe the Plan and to resolve all
questions arising thereunder. Any action by the Committee shall be
final and conclusive as to all individuals affected
thereby.
The Committee shall have sole and
complete authority to determine the employees to whom Performance
Award opportunities shall be allotted for each Performance Cycle,
to determine the basis for measuring the value of such Performance
Awards, and to determine the value of such Performance Award
opportunities, if any, to be allotted to each Participant.
Performance Awards may be based on such unit of value as the
Committee may in its sole discretion designate.
The Committee may delegate to any
director, officer, or employee such ministerial or administrative
duties relating to the Plan as deemed appropriate by the
Committee. No member of the Board or of the Committee shall
be liable for any act done or omitted to be done by such member or
by any other member in connection with the Plan, except for such
member’s own willful misconduct or as expressly provided by
statute.
5.
ELIGIBILITY
The Committee shall, in its sole
discretion, specify in writing for each Performance Cycle those
officers and employees of the Company or any Affiliate who shall be
eligible to participate in the Plan for such Performance Cycle
based upon such Participants’ ability to have a substantial
impact on the Company’s longer-term results. Only
employees of the Company and its Affiliates are eligible to
participate in the Plan. Nothing contained in the Plan shall
be construed as or be evidence of any contract of employment with
any Participant for a term of any length, or as a limitation on the
right of the Company to discharge any Participant with or without
cause.
6.
PERFORMANCE AWARDS AND PERFORMANCE GOALS
Any Performance Award earned by a
Participant shall be credited to a bookkeeping account to be
maintained by the Company for such Participant. At the start
of each Cycle, the Committee shall establish the value of each
Performance Award opportunity to be allotted for the
Cycle.
The Committee shall establish
Performance Goals for each Cycle to accomplish such objectives as
the Committee may from time to time determine. P
