Exhibit 10.1

TEMPLE-INLAND INC.

 

NONQUALIFIED DEFERRED COMPENSATION PLAN

(as amended and restated effective November 2, 2007)

 

ARTICLE 1

 

Intent

This Temple-Inland Inc. Nonqualified Deferred Compensation Plan is maintained by
Temple-Inland Inc. for the purpose of allowing eligible employees to defer the
receipt of compensation. The Plan is intended to qualify as a “top-hat” plan for
purposes of ERISA and shall cover a select group of management or highly
compensated employees.

ARTICLE 2

 

Definitions

2.1       "Account" means the Account maintained for each Participant in
accordance with the terms of Article 4 hereof and shall include a Participant’s
Bonus Deferral Account and Section 162(m) Deferral Account (both as defined
under this Plan prior to the date of this amendment and restatement).

2.2       “Affiliate” means each trade or business, whether or not incorporated,
that together with the Company, is treated as a “single employer” under Section
414(b) or 414(c) of the Code.

 

2.3

“Board” means the Board of Directors of the Company.

2.4       “Bonus” means (a) an Eligible Employee’s annual bonus, and (b) such
other bonuses payable to an Eligible Employee as may be specified by the
Committee in its discretion from time to time.

2.5       “Change in Control” means the occurrence of a “change in control
event” (within the meaning of Section 409A of the Code) with respect to the
Company.

 

2.6

“Code” means the Internal Revenue Code of 1986, as amended.

2.7       “Committee” means the Management Development and Executive
Compensation Committee of the Board of Directors of the Company.

2.8       “Common Stock” means the common stock, $1.00 par value, of the Company
and, in the event such common stock is converted to another security or
property, such other security or property.

2.9       "Company" means Temple-Inland Inc., a Delaware corporation, and its
successors by merger, sale of assets or otherwise.

 

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2.10     “Crediting Date” means the date on which Eligible Compensation would
have been paid to an Eligible Employee absent the Deferral Election covering
such Eligible Compensation, provided that in the case of a Bonus, “Crediting
Date” means that date as of which the Board, Committee, or other person approves
the Bonus, whether or not the Bonus would have been paid on such date.

2.11     “Deferral Election” means an irrevocable election by an Eligible
Employee, made on a form prescribed by the Committee and delivered to the
Committee or its designee, to defer under this Plan the receipt of all or a
specified portion of Eligible Compensation otherwise payable to the Participant.
A Deferral Election shall be effective when the form is countersigned on behalf
of the Company.

2.12     "Deferred Compensation" means Eligible Compensation that is deferred by
a Participant pursuant to the terms of this Plan.

2.13      “Eligible Compensation” means an Eligible Employee’s Bonus and such
other compensation, if any, that the Committee may designate as being Eligible
Compensation for purposes of the Plan.

2.14     "Eligible Employee" means an employee of the Company or one of its
Affiliates who is specifically designated by the Committee as being eligible
under the Plan.

2.15     “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended.

2.16     “Fair Market Value” means, unless otherwise determined by the
Committees, the closing price of a share of Common Stock on the New York Stock
Exchange (“NYSE”) as of the relevant date (or if the NYSE is not open on such
date or the Common Stock is not traded on that day, the most recent prior date
that the NYSE was open for trading and the Common Stock was traded).

2.17     “Matched Bonus Deferral” means a Bonus covered by a Deferral Election
to the extent that the Payment Date with respect to the Bonus is at least five
years after the Crediting Date for the Bonus and to the extent that the Bonus
and amounts attributable thereto are credited to the Participant’s Account as
Phantom Shares.

2.18     “Participant" means an Eligible Employee who has deferred Eligible
Compensation pursuant to the terms of this Plan.

2.19     “Payment Date” means the date(s) or event(s) specified by the
Participant in the Participant’s Deferral Election for the payment of Deferred
Compensation, provided that in no event shall any such date or event fail to
satisfy Section 409A of the Code.

2.20     “Period of Service” means a Participant’s Period of Service as
determined in accordance with the terms of the Temple-Inland Salaried Savings
Plan, whether or not the Participant is a participant in such plan.

 

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2.21     “Phantom Shares” means hypothetical shares of Common Stock credited to
a Participant’s Account having a value equal to the Fair Market Value of an
equal number of shares of Common Stock.

2.22     "Plan" means the Temple-Inland Inc. Nonqualified Deferred Compensation
Plan, as set forth herein and amended from time to time. Prior to November 2,
2007 the Plan was named the Temple-Inland Inc. Stock Deferral and Payment Plan.

2.23     “Pre-Retirement Termination” means a Participant’s Voluntary
Termination prior to attaining (a) at least age 65 or (b) at least age 55 and
completing a Period of Service of at least five years.

2.24     “Separation from Service” means a “separation from service” (within the
meaning of Section 409A of the Code) from the Company and its Affiliates.

2.25     "Stock Plan” means the Temple-Inland Inc. 1988 Stock Option Plan, the
Temple-Inland Inc. 1993 Stock Option Plan, the Temple-Inland Inc. 1997 Stock
Option Plan, the Temple-Inland Inc. 2001 Stock Incentive Plan, the Temple-Inland
Inc. 2003 Stock Incentive Plan, and any other plan adopted by the Company that
provides for the grant of stock options, phantom stock, or restricted stock to
employees.

2.26     “Unforeseeable Emergency" means an “unforeseeable emergency” within the
meaning of Section 409A of the Code.

2.27     “Voluntary Termination” means a Participant’s Separation from Service,
other than (a) by reason of death or disability or (b) by the Company and its
Affiliates without cause (as determined by the Company in good faith).

ARTICLE 3

 

Deferral of Compensation

3.1       Deferral Elections. In order to defer Eligible Compensation hereunder,
an Eligible Employee must file a Deferral Election before the first day of the
calendar year during which the Eligible Compensation will be earned.
Notwithstanding the foregoing, a Deferral Election may be filed on or after the
first day of a calendar year (a) in the case of an Eligible Employee who first
becomes an Eligible Employee on or after the first day of the calendar year,
provided that the Deferral Election is made within 30 days after the date on
which the Eligible Employee first becomes eligible to participate in the Plan
and the Deferral Election applies only to Eligible Compensation earned after the
date of the election, and (b) with respect to any Eligible Compensation that
consitutes “performance-based compensation,” to the extent permitted under
Section 409A of the Code and authorized by the Committee. Pursuant to each
Deferral Election, a Participant shall specify the Eligible Compensation to be
deferred and elect the Payment Date for that portion of the Participant’s
Account attributable to such Deferral Election.

 

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3.2       Revocation or Modification of Deferral Elections. A Participant’s
Deferral Election may not be revoked or modified except to the extent authorized
by the Committee and permitted by Section 409A of the Code.

ARTICLE 4

 

Accounts

4.1       Establishment of Accounts. The Company shall establish an Account for
each Participant who makes a Deferral Election hereunder. The Company shall
maintain each Account in a manner such that the portion of the Account
attributable to each Deferral Election and any Matching Phantom Shares (as
defined in Section 4.3 herein) credited in respect of such elections can be
determined.

4.2       Crediting of Phantom Shares Upon Deferral of Compensation. Except as
provided in Section 4.8 below, as of the Crediting Date for Eligible
Compensation covered by a Deferral Election, the applicable Participant’s
Account shall be credited with a number of Phantom Shares equal to the quotient
obtained by dividing (a) the amount of the Eligible Compensation covered by the
Deferral Election (and reduced by the amount of any federal, state, local or
other taxes required by law to be withheld upon the Eligible Compensation to the
extent not otherwise satisfied), by (b) the Fair Market Value of a share of
Common Stock as of such date. Such Participant’s Account shall also be credited
with Matching Phantom Shares to the extent provided by Section 4.3 hereof.

4.3       Matching Phantom Shares. The Account of a Participant who has made a
Matched Bonus Deferral shall be credited, as of the applicable Crediting Date,
with an additional number of Phantom Shares (“Matching Phantom Shares”) equal to
the quotient obtained by dividing (a) by (b), where:

•          is the product of (i) 2% of the amount of the Matched Bonus Deferral
and (ii) the number of full years (not in excess of ten) from the applicable
Crediting Date to the applicable Payment Date; and

•          is the Fair Market Value of a share of Common Stock as of the
applicable Crediting Date.

Matching Phantom Shares shall have the same value, and be subject to adjustment
in the same manner, as other Phantom Shares credited to a Participant’s Account;
provided, however, that if the Participant incurs a Voluntary Termination prior
to the earlier of completing a Period of Service of at least three years or the
occurrence of a Change in Control, the entire portion of the Participant’s
Account attributable to such Matching Phantom Shares shall be immediately
forfeited.

 

4.4

Deemed Dividends.

(a) Before 2008. Each Participant’s Account shall, upon the payment of any cash
dividend or cash distribution on Common Stock prior to January 1, 2008, be
credited with an additional number of Phantom Shares (including any fractional
share) equal to the quotient

 

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obtained by dividing (a) the amount of cash dividends or distributions that
would have been paid with respect to the Phantom Shares theretofore credited to
the Participant’s Account had they been actual issued and outstanding shares of
Common Stock by (b) the Fair Market Value of a share of Common Stock on the
dividend or distribution payment date. Phantom Shares credited to a
Participant’s Account in accordance with this Section 4.4(a) shall, upon
payment, be settled in the form of cash; provided, however, that Phantom Shares
credited to a Participant’s Account in accordance with this Section 4.4(a)
either (i) on or before December 31, 2005, or (ii) after December 31, 2005, but
before December 1, 2007, to the extent attributable to the Participant’s Bonus
Deferal Account, shall be settled in the form of Common Stock.

(b) After 2007. Not later than 30 days after the payment date of any cash
dividend or cash distribution declared on the Common Stock on or after January
1, 2008, the Company shall pay to each Participant, in cash, an amount equal to
the amount of the cash dividend or other cash distribution that would have been
paid to the Participant if the Phantom Shares allocated to the Participant's
Account were actual issued and outstanding shares of Common Stock held by the
Participant.

4.5       Phantom Share Adjustments. If any of the following events occur, the
Committee shall make appropriate adjustments with respect to Phantom Shares
credited to a Participant’s Accounts: (a) any extraordinary non-cash dividend or
other extraordinary non-cash distribution in respect of Common Stock (whether in
the form of Common Stock, other securities or other property); (b) any
recapitalization, stock split (including a stock split in the form of a stock
dividend), reverse stock split, reorganization, merger, combination,
consolidation, split-up, spin-off, combination, repurchase or exchange of Common
Stock or other securities of the Company; (c) any issuance of warrants or other
rights to purchase shares of Common Stock or other securities of the Company
(other than to employees); or (d) any other like corporate transaction or event
in respect of the Common Stock.

4.6       Certain Spin-Off Adjustments. If the Company spins off all its stock
of Guaranty Financial Group Inc. (“Guaranty”) and/or all of its stock of
Forestar Real Estate Group Inc. (“Forestar”), Participants’ Accounts shall be
adjusted in accordance with the terms of the Employee Matters Agreement entered
into by and among the Company, Guaranty, and Forestar (the “Employee Matters
Agreement”), and Guaranty and Forestar shall assume the obligation to make
payments to Participants with respect to Guaranty stock (or phantom stock) and
Forestar stock (or phantom stock) allocated to Participants’ Accounts as
provided in the Employee Matters Agreement.

4.7       Payments. A Participant’s Accounts shall be reduced by any payments
made to the Participant, his or her beneficiary, estate, or representative.

4.8       Alternative Deemed Investments. The Committee may, in its discretion,
provide for all or a portion of a Particicipant’s Account to be deemed invested
in such investments as the Committee may designate from time-to-time. In such
event, the Committee shall specify such rules from time-to-time relating to
Participant investment elections and valuation dates as it may determine in its
discretion.

 

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4.9       No Funding of Benefits. All adjustments to a Participant’s Accounts
shall be bookkeeping entries only and shall not represent a special reserve or
otherwise constitute a funding of the Company’s unsecured promise to pay any
amounts hereunder. To the extent a Participant or any other person acquires a
right to receive payments from the Company under this Plan, such right shall be
no greater than the right of any unsecured general creditor of the Company, and
such person shall have only the unsecured promise of the Company that such
payments shall be made.

ARTICLE 5

 

Payment of Deferred Compensation

5.1       Payment in Accordance with Elections. Subject to Section 5.2 and
Sections 5.4 through 5.8, a Participant’s Account shall be paid to the
Participant in the form of a lump sum on or as soon as practicable following the
applicable Payment Date(s) elected by the Participant in the Participant’s
Deferral Elections(s) (but in no event more than 60 days after such Payment
Date(s)).

5.2       Payment Upon Pre-Retirement Termination or Death. Notwithstanding
Section 5.1 and the Payment Date(s) specified in a Participant’s Deferral
Elections, in the event of a Participant’s Pre-Retirement Termination or death,
the entire balance of the Participant’s Account (as reduced by any amount
forfeited pursuant to Section 4.3 hereof) shall be paid to the Participant (or
the Participant’s beneficiary, as determined in accordance with Section 8.2
hereof) in the form of a single payment as soon as practicable after such
Pre-Retirement Termination or death (and in no event more than 90 days after
such termination or death).

5.3       Form of Payment. Phantom Shares credited to a Participant’s Account
shall, upon payment, be settled in the form of cash; provided, however, that
Phantom Shares credited to a Participant’s Account either (a) on or before
December 31, 2005, or (b) after December 31, 2005, to the extent attributable to
the Participant’s Bonus Deferal Account, shall be settled in the form of Common
Stock, except to the extent provided in Section 4.4(a) hereof. If any Phantom
Share payable in the form of Common Stock represents a fractional share of
Common Stock, the Fair Market Value of such fractional share on the date the
payment is calculated shall be paid in cash. Amounts credited to a Participant’s
Account in a form other than Phantom Shares shall be paid in the form of cash.

5.4       Change in Control. Notwithstanding any Deferral Election, the entire
balance of a Participant’s Account shall be paid in accordance with Section 5.3
upon the occurrence of a Change in Control.

5.5       Unforeseeable Emergency. The Committee may accelerate payment of all
or a portion of a Participant’s Account upon the occurrence of an Unforseeable
Emergency. The amount of such payment shall be limited to the amount reasonably
necessary to satisfy the emergency need (which may include amounts necessary to
pay any federal, state or local income taxes or penalties reasonably anticipated
to result from such payment). The determination of whether a Participant has
experienced an Unforseeable Emergency and the amount reasonably necessary to
satisfy the emergency need shall be based on all the facts and circumstances
taking

 

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into consideration the financial resources available to the Participant and
shall be made in accordance with Section 409A of the Code.

5.6       Pre-November 2, 2007 Deferral Elections. A Participant’s Account, to
the extent attributable to a Deferral Election made prior to November 2, 2007,
shall be paid in accordance with the terms of such election. If such election
provides for payment in the form of installment payments, such payments shall be
made in accordance with Section 5.3 of the Plan as in effect as of November 1,
2007. In all events, such Deferral Elections and payments shall be subject to
Sections 5.2 and 5.8 hereof.

5.7       Certain Consents to Payments. Notwithstanding anything in this Article
5 to the contrary, in the case of any Participant who has executed a “Consent to
Distribution” relating to this Plan, the Participant’s Account shall be paid in
accordance with such Consent to Distribution.

5.8       Section 409A Mandatory Delay in Benefit Payments for Specified
Employees. Notwithstanding the preceding provisions of this Article 5, to the
extent required by Section 409A of the Code, the Committee shall delay payment
of the Account of a Participant who is a “specified employee” (within the
meaning of Section 409A of the Code) until the earlier of (a) the date that is
six months after the date of the Participant’s Separation From Service, or (b)
the date of the specified employee’s death. The aggregate amount of payment(s)
otherwise payable during the delay period (plus interest thereon at a rate equal
to the simple average of the rate for the last four reported quarters preceding
the Participant’s Separation from Service under the Vanguard U.S. Treasury Fund
under the Temple-Inland Salaried Savings Plan or any successor thereto) shall be
payable to the specified employee upon the expiration of the delay period.

5.9       Withholding. Notwithstanding anything herein, in order to satisfy any
withholding obligations under federal, state or local law in respect of amounts
paid (whether in cash or Common Stock) or credited to a Participant under this
Plan, the Company and its Affiliates shall have the right to (a) withhold such
amounts from any payment to be made pursuant to this Plan or any other payment
to be made to a Participant by the Company or any of its Affiliates, or (b)
reduce the number of Phantom Shares (or other amount) credited or to be credited
to a Participant’s Account.

ARTICLE 6

 

Claims

6.1       Claims Procedure. Claims for benefits under the Plan shall be filed
with the Committee. If any Participant, beneficiary or other payee (a
“claimant”) claims to be entitled to a benefit under the Plan and the Committee
determines that such claim should be denied in whole or in part, the Committee
shall notify such claimant of its decision in writing (which may be provided
electronically). Such notification will be written in a manner calculated to be
understood by the claimant and will contain (a) specific reasons for the denial,
(b) specific reference to pertinent Plan provisions, (c) a description of any
additional material or information necessary for the claimant to perfect such
claim and an explanation of why such material or information is necessary, and
(d) a description of the Plan’s review procedures and the time

 

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limits applicable to such procedures, including a statement of the claimant’s
right to bring a civil action under Section 502(a) of ERISA following the
rendering of an adverse decision on review. Such notification will be given
within a reasonable period of time, but not later than 90 days after the claim
is received by the Committee, unless the Committee determines that special
circumstances require an extension of time for processing the claim. If the
Committee determines that such an extension of time is required, written notice
of the extension shall be provided to the claimant prior to the end of the
initial 90-day period. The extension notice shall indicate the special
circumstances requiring the extension of time and the date by which the
Committee expects to render its decision. In no event shall the extension exceed
an additional 90 days from the end of the initial 90-day period. Any electronic
notification provided by the Committee under this Section 6.1 or Section 6.2
shall comply with the standards imposed by 29 C.F.R. 2520.104b-1(c)(1)(i)-(iv).

 

6.2

Review of Claims Decision.

•          Procedures. Within 60 days after the date on which a claimant
receives a written notice of a denied claim, the claimant may file a written
request with the Committee for a review of the denied claim. If the claimant
requests a review of the denied claim, the claimant shall be entitled to submit
to the Committee written comments, documents, records and other information
relating to the claim for benefits and to receive, upon request and free of
charge, reasonable access to, and copies of, all documents, records and other
information relevant to the claimant’s claim for benefits. The Committee shall
perform its review taking into account all comments, documents, records and
other information submitted by the claimant relating to the claim without regard
to whether such information was submitted or considered in the initial benefit
determination. The Committee will notify the claimant of its decision in writing
(which may be provided electronically). If the claim is denied, the notification
will be written in a manner calculated to be understood by the claimant and will
contain (a) the specific reasons for the denial, (b) references to pertinent
provisions of the Plan, (c) a statement that the claimant is entitled to
receive, upon request and free of charge, reasonable access to, and copies of,
all documents, records and other information relevant to the claimant’s claim
for benefits, and (d) a statement of the claimant’s right to bring an action
under Section 502(a) of ERISA.

•          Timing of Review. The review provided for by Section 6.2(a) will be
made within a reasonable period of time, but not later than 60 days after the
Committee receives the request for review, unless the Committee determines that
special circumstances require an extension of time for processing the claim. If
the Committee determines that an extension of time is required, written notice
of the extension shall be furnished to the claimant prior to the end of the
initial 60-day period. The extension notice shall indicate the special
circumstances requiring the extension of time and the date by which the
Committee expects to render its decision. In no event shall the extension exceed
an additional 60 days from the end of the initial 60-day period. If the
extension of time is needed due to the claimant’s failure to submit information
necessary to make a decision, the period during which the Committee must make a
decision shall be tolled from the date the extension notice is sent to the
claimant until the date the claimant responds to the request for additional
information.

 

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ARTICLE 7

Administration

7.1       Administration. This Plan shall be administered by the Committee. The
Committee shall have all powers necessary to carry out the provisions of this
Plan, including, without reservation, the power to delegate administrative
matters to other persons and to interpret this Plan in its discretion.

ARTICLE 8

 

Miscellaneous

8.1       Amendment or Termination. The Committee may modify or amend, in whole
or in part, any or all of the provisions of this Plan, or suspend or terminate
the Plan entirely; provided, however, that any such modification, amendment,
suspension or termination may not, without a Participant's written consent,
adversely affect (as reasonably determined by the Committee) the terms and
conditions under which any amounts previously credited to a Participant's
Account are administered.

8.2       Beneficiary Designation. Each Participant shall designate a
beneficiary to whom the Participant’s Account shall be payable on the
Participant’s death. A Participant may also designate an alternate beneficiary
to receive such payment in the event that the designated beneficiary cannot
receive payment for any reason. In the event no designated or alternate
beneficiary can receive such payment for any reason, payment will be made to the
Participant’s surviving spouse, if any, or if the Participant has no surviving
spouse, then to the following beneficiaries if then living in the following
order of priority: (a) to the Participant’s children (including adopted children
and stepchildren) in equal shares, (b) to the Participant’s parents in equal
shares, (c) to the Participant’s brothers and sisters in equal shares and (d) to
the Participant’s estate. A Participant may at any time change his or her
beneficiary designation. A change of beneficiary designation must be made in
writing and delivered to the Committee or its designee for such purposes. The
interest of any beneficiary who predeceases the Participant will terminate
unless otherwise specified by the Participant.

8.3       Alienation of Benefits. A Participant's rights under this Plan shall
not be subject in any manner to anticipation, alienation, sale, transfer,
assignment pledge, encumbrance, attachment, or garnishment by creditors of a
Participant or any beneficiary.

8.4       Phantom Stock Granted and Shares Issued Under Stock Plans. Phantom
Shares credited to Participants’ Accounts under Article 4 shall constitute the
grant of “Phantom Stock” under the Stock Plan then in effect and under which
stock-based awards are then being made, unless otherwise specified by the
Committee. Common Stock issued in payment of Phantom Shares credited to
Participants’ Accounts hereunder shall be issued under the Stock Plan pursuant
to which the applicable Phantom Stock was issued.

8.5       Expenses. All expenses and costs in connection with the operation of
the Plan shall be borne by the Company.

 

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8.6       Rules of Construction. The singular shall include the plural unless
the context clearly indicates the distinction.

8.7       Applicable Law. This Plan shall be construed and enforced in
accordance with the laws of the State of Texas except to the extent superseded
by federal law.

8.8       Headings. The headings of sections of this Plan are for convenience of
reference only and shall have no substantive effect on the provisions of this
Plan.

8.9       Compliance with Section 409A of the Code. The Plan is intended to
comply with the requirements of Section 409A of the Code, and the Committee
shall administer and interpret the Plan in accordance with such requirements. If
any provision of the Plan conflicts with the requirements of Section 409A of the
Code, the requirements of Section 409A of the Code shall supersede any such Plan
provision.

 

 

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