Exhibit 10.25

 

 

 

MEADWESTVACO CORPORATION DEFERRED INCOME PLAN

 

 

Restatement Effective January 1, 2007 (except as otherwise provided)

 

 

 

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TABLE OF CONTENTS

 

ARTICLE 1 . INTRODUCTION    1

1.01.

     History of the Plan    1

1.02.

     Purposes of the Plan    1

1.03.

     American Jobs Creation Act of 2004 (“AJCA”)    2

1.04.

     Effective Date    3 ARTICLE 2 . DEFINITIONS AND CONSTRUCTION    3

2.01.

     Definitions    3

2.02.

     Construction    7

2.03.

     Timing of Payments    7 ARTICLE 3 . PARTICIPATION    7

3.01.

     Commencing Participation    7

3.02.

     Ending Participation    8 ARTICLE 4 . CREDITS TO PARTICIPANTS’ ACCOUNTS   
8

4.01.

     Eligible Employee Deferrals    8

4.02.

     Employer Non-Qualified Matching Credits    10 ARTICLE 5 . INVESTMENTS AND
ACCOUNTS    11

5.01.

     Participant Allocation of Accounts Among Book-Entry Investment Funds    11

5.02.

     Change in Allocation    11

5.03.

     Valuation of Investment Funds    12

5.04.

     Sub-Accounts    12

5.05.

     Risk of Loss    13

5.06.

     Interests in the Plan    13

5.07.

     Special Provisions Applicable to the Company Stock Portion of the Plan   
13 ARTICLE 6 . VESTING AND FORFEITURE    13

6.01.

     Vesting    13

6.02.

     Forfeiture    14 ARTICLE 7 . PAYMENTS    14

7.01.

     Distribution Election Process    14

7.02.

     Types of Distributions    14

7.03.

     Form of Payment of Distributions    16

7.04.

     Changes to the Time and Form of Distribution    17

7.05.

     Pre-AJCA Accounts    19

 

 

MEADWESTVACO CORPORATION   2007 RESTATEMENT DEFERRED INCOME PLAN   TABLE OF
CONTENTS

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ARTICLE 8 . HARDSHIP WITHDRAWALS AND PAYMENTS UPON DEATH    19

8.01.

   Hardship Withdrawal.    19

8.02.

   Payments Upon Death    20

8.03.

   Designation of Beneficiary    21

8.04.

   Pre-AJCA Accounts    21 ARTICLE 9 . PLAN ADMINISTRATION    21

9.01.

   Plan Administrator    21

9.02.

   Delegation and Employment of Agents    21

9.03.

   Interpretations    21

9.04.

   Elections and Designations    22

9.05.

   Claims    22

9.06.

   Postponement of Action    22 ARTICLE 10 . AMENDMENT AND TERMINATION OF PLAN
   22

10.01.

   Amendment of the Plan    22

10.02.

   Termination of the Plan    23

10.03.

   Design Decisions    23 ARTICLE 11 . MISCELLANEOUS PROVISIONS    23

11.01.

   Employment Rights Not Affected by Plan    23

11.02.

   Doubt as to Identity    24

11.03.

   Payment Medium    24

11.04.

   Obligations to Make Payments    24

11.05.

   Liability Limited    24

11.06.

   Overpayments    24

11.07.

   Incapacity and Minor Status    25

11.08.

   Assignment and Liens    25

11.09.

   Withholding Taxes    25

11.10.

   Titles and Headings Not to Control    25

11.11.

   Notice of Process    25

11.12.

   Plan Expenses    26

11.13.

   Governing Law and Limitation on Actions    26

11.14.

   Class Action Forum Selection Clause    26

11.15.

   Severability    27

11.16.

   Integration Clause and Complete Statement of Plan    27 APPENDIX A. TRANSFER
OF EX-CAP BALANCES    A-1 APPENDIX B. DISTRIBUTION OF PRE-AJCA DIP ACCOUNTS   
B-1 APPENDIX C. DISTRIBUTION OF PRE-AJCA EX-CAP ACCOUNTS    C-1

 

 

MEADWESTVACO CORPORATION   2007 RESTATEMENT

DEFERRED INCOME PLAN

  TABLE OF CONTENTS

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ARTICLE 1. INTRODUCTION

 

1.01. HISTORY OF THE PLAN

 

(a) Immediately before January 1, 2003, two operating subsidiaries of
MeadWestvaco (The Mead Corporation and Westvaco Corporation) sponsored five
non-qualified defined contribution plans for their eligible employees. These
plans were then known as (1) the Westvaco Corporation Deferred Compensation
Plan, (2) the Westvaco Corporation Savings and Investment Restoration Plan,
(3) the Westvaco Corporation Excess Benefit Plan, (4) The Mead Corporation
Executive Capital Accumulation Plan, and (5) The Mead Corporation Incentive
Compensation Election Plan.

 

(b) Deferrals to the plans listed in paragraph (a), above, were discontinued
before January 1, 2003. In place of those plans, MeadWestvaco created the
MeadWestvaco Corporation Deferred Income Plan (the “Plan”). Before 2005,
participants in those plans were permitted, but not required, to “roll over”
their balances under those plans into the Plan. Such rolled-over balances are
subject to the terms of the Plan.

 

(c) The remaining account balances under the Westvaco Corporation Deferred
Compensation Plan, Westvaco Corporation Savings and Investment Restoration Plan,
Westvaco Corporation Excess Benefit Plan and Mead Corporation Incentive
Compensation Election Plan—i.e., those not “rolled over” to the Plan before
2005—remain subject to the terms and conditions of those plans.

 

(d) The remaining account balances under the Mead Corporation Executive Capital
Accumulation Plan—i.e., those not “rolled over” to the Plan before 2005—remained
subject to the terms and conditions of the Mead Corporation Executive Capital
Accumulation Plan in 2005 and 2006. However, effective January 1, 2007,
MeadWestvaco merged the Mead Corporation Executive Capital Accumulation Plan
into this Plan. As a result of the merger, the remaining account balances under
the Mead Corporation Executive Capital Accumulation Plan—i.e., those not “rolled
over” to the Plan before 2005—are governed by (i) Appendix A of the Plan, which
applies to Participants who were employed by the Company or an 80% Affiliate on
or after January 1, 2005; or (ii) Appendix C of the Plan, which applies to
Participants who terminated employment before January 1, 2005.

 

1.02. PURPOSES OF THE PLAN

 

(a) The purposes of the Plan are to enable Participants to defer voluntarily the
receipt of certain amounts, including compensation not otherwise eligible for
deferral under the MeadWestvaco Corporation Savings and Employee Stock Ownership
Plan for Salaried and Non-Bargained Employees (the “Qualified Plan”), to provide
matching credits on certain deferrals, to restore certain benefits that cannot
be provided under the Qualified Plan, and to provide retirement and other
benefits to Participants through an individual account program.

 

 

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(b) The Plan is unfunded and benefits due under the Plan remain subject to the
claims of the Company’s general creditors in the event of the Company’s
bankruptcy or insolvency. Benefits due under the Plan shall be payable from the
general assets of the Company or from any unsecured (“rabbi”) trust or similar
arrangement, the assets of which shall be subject to the claims of the Company’s
general creditors in the event of the Company’s bankruptcy or insolvency.

 

(c) The Plan is maintained primarily for the purpose of providing deferred
compensation for a select group of management and/or highly compensated
employees of the Company. The Plan shall not be subject to the participation and
vesting requirements, funding provisions, or fiduciary duty rules (Parts 2, 3,
and 4 of Title I) of ERISA.

 

1.03. AMERICAN JOBS CREATION ACT OF 2004 (“AJCA”)

 

(a) Effective January 1, 2005, except as provided in Section 1.03(c):

 

  (1) All benefits under the Plan shall be subject to section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”);

 

  (2) The Plan shall comply with the requirements of, and shall be operated,
administered, and interpreted in accordance with, (A) before January 1, 2009, a
reasonable good-faith interpretation of section 409A of the Code and (B) after
December 31, 2008, section 409A of the Code; and

 

  (3) For the period from January 1, 2005 through December 31, 2008, the Company
and the Administration Committee had sole discretion to override the terms set
forth in the plan document for the Plan to the extent that either the Company or
the Committee determined to be necessary or appropriate to comply with a
good-faith, reasonable interpretation of the requirements of section 409A of the
Code.

 

  (4) If the Company or Administration Committee determines that any provision
of the Plan is or might be inconsistent with the restrictions imposed by section
409A, such provision shall be deemed to be amended to the extent that the
Company or Administration Committee determines is necessary to bring it into
compliance with the requirements of section 409A of the Code. Any such deemed
amendment shall be effective as of the earliest date such amendment is necessary
under section 409A of the Code.

 

(b) No provision in the Plan shall be interpreted or construed to (1) create any
liability for the Company or any Affiliate, or any of their employees, officers,
directors, or other service providers, related to a failure to comply with
section 409A or (2) transfer any liability for a failure to comply with section
409A from a Participant or other individual to the Company or any Affiliate, or
any of their employees, officers, directors, or other service providers.

 

(c) Pre-AJCA Accounts (as defined in Section 2.01(dd)) are not subject to
section 409A of the Code. Notwithstanding any provision of this Section 1.03 to
the contrary, Pre-AJCA Accounts shall be administered in accordance with the
special provisions set forth in Appendix B and Appendix C, as applicable, which
reflect terms that have been in effect since before October 4, 2004. With
respect to such Pre-AJCA Accounts, no amendment shall be made to the Plan that
would constitute or result in a “material modification” of the Plan (within the
meaning of section 885(d) of the AJCA) unless, and only to the extent that, such
amendment expressly states that it is intended to constitute a “material
modification” with respect to one or more Pre-AJCA Accounts.

 

 

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1.04. EFFECTIVE DATE

Unless a particular provision of the Plan specifies a different effective date
for that provision, this restatement of the Plan shall be effective January 1,
2007.

ARTICLE 2. DEFINITIONS AND CONSTRUCTION

 

2.01. DEFINITIONS

For purposes of the Plan, unless the context clearly or necessarily indicates
the contrary, the following words and phrases shall have the meanings set forth
in the definitions below:

 

(a) “Account” means an unfunded book-entry account for a Participant,
representing deferrals and other credits to the Plan, as adjusted to reflect
earnings, losses, and payments. Each Account shall be divided into sub-accounts
in accordance with Section 5.04. Accounts established under the Plan shall hold
no actual funds or assets.

 

(b) “Administration Committee” means the individuals constituting the Benefit
Plans Administration Committee designated by MeadWestvaco’s Chief Executive
Officer, or similar committee appointed pursuant to Section 9.01.

 

(c) “Affiliate” means, with respect to the MeadWestvaco or a Designated
Subsidiary, any person or entity that is required to be combined with
MeadWestvaco or the Designated Subsidiary as a single employer under section
414(b) or (c) of the Code, except that the 80 percent ownership standard
prescribed by section 1563(a)(1), (2), and (3) of the Code and Treas. Reg.
§ 1.414(c)-2 shall be replaced with a 50 percent ownership standard.

 

(d) “AJCA” means the American Jobs Creation Act of 2004, as amended.

 

(e) “Base Salary” means the gross amount of base salary, before reduction for
tax withholding and pre-tax or after-tax contributions to any employee benefit
plan, and before any other payroll deductions. Base Salary shall not include any
pay offered in lieu of vacation.

 

(f) “Beneficiary” means, in the case of any Participant who dies, the person or
persons designated in accordance with Section 8.03.

 

(g) “Board of Directors” means the Board of Directors of MeadWestvaco.

 

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

 

(i)

“Commission” means compensation that consists of either a portion of the
purchase price for a product or services or an amount substantially all of which
is calculated by reference to volume of sales, where payment of the compensation
is

 

 

MEADWESTVACO CORPORATION   2007 RESTATEMENT DEFERRED INCOME PLAN   PAGE 3

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contingent upon the employing Company or any of its 80% Affiliates receiving
payment from an unrelated customer for such product or services. Any Commission
shall be attributable to the Plan Year in which the customer remits to the
applicable Company or 80% Affiliate the payment that gives rise to the
Commission.

 

(j) “Company” means MeadWestvaco and/or each Designated Subsidiary.

 

(k) “Deferral Election” means an Eligible Employee’s election to defer
compensation pursuant to Section 4.01.

 

(l) “Designated Subsidiary” means any entity of which at least 50 percent of the
outstanding ordinary voting stock or control is owned directly or indirectly by
MeadWestvaco, and that has been designated by the Chief Executive Officer of
MeadWestvaco or the Board of Directors as having employees who are eligible to
participate in the Plan as of a date determined by such designation.

 

(m) “Distribution Election” means a Participant’s election of the timing and
manner of payment of all or part of his Account, filed in accordance with
Section 7.01.

 

(n) “80% Affiliate” means, with respect to MeadWestvaco or a Designated
Subsidiary, any person or entity that is required to be combined with
MeadWestvaco or the Designated Subsidiary as a single employer under section
414(b) or (c), using the 80 percent ownership standard prescribed by section
1563(a)(1), (2), and (3) of the Code and Treas. Reg. § 1.414(c)-2.

 

(o) “Eligible Employee” means any individual who is part of the select group of
management or highly-paid employees of the Company who are designated by the
Administration Committee as eligible to participate in the Plan.

 

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

 

(q) “Excess Compensation” means, for any Plan Year, the excess of a
Participant’s Gross Compensation for such Plan Year over his “eligible
compensation” (as defined in the Qualified Plan) for such Plan Year.

 

(r) “409A Account Plan” means any nonqualified “account balance plan” described
in Treas. Reg. § 1.409A-1(c)(2)(i)(A) or (B) that is maintained by the Company
or an 80% Affiliate.

 

(s) “Gross Compensation” means, for any period, “eligible compensation” for such
period as defined in the Qualified Plan, without regard to the limit required by
section 401(a)(17) of the Code, plus the amount deferred for such period under
the Plan.

 

(t) “Investment Fund” means a book-entry investment fund maintained pursuant to
Section 5.01.

 

(u) “Investment Policy Committee” means the Benefit Plans Investment Policy
Committee designated by MeadWestvaco’s Chief Executive Officer or similar
committee appointed pursuant to Section 9.01.

 

 

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(v) “MeadWestvaco” means MeadWestvaco Corporation, a Delaware Corporation.

 

(w) “MeadWestvaco Common Stock” means shares of common stock of MeadWestvaco
Corporation.

 

(x) “Open Enrollment” means the period or periods established by the
Administration Committee during which Eligible Employees may make or change
their Deferral Elections.

 

(y) “Participant” means an Eligible Employee who satisfies the eligibility
requirements set forth in Article 3, or who has a positive balance in his
Account.

 

(z) “Performance-Based Compensation” means compensation that qualifies as
“performance-based compensation” under Treas. Reg. § 1.409A-1(e). In general,
Performance-Based Compensation includes wages and other compensation the amount
or entitlement to which is contingent on the satisfaction of preestablished
organizational or individual performance criteria relating to a performance
period of at least 12 consecutive months. Performance-Based Compensation shall
not include any amount or portion of any amount that is (1) payable regardless
of performance or (2) based upon criteria that are substantially certain to be
met at the time such criteria are established.

 

(aa) “Plan” means the MeadWestvaco Corporation Deferred Income Plan, as set
forth herein and as amended from time to time.

 

(bb) “Plan Administrator” means any plan administrator appointed pursuant to
Section 9.01. The Plan Administrator shall be a member of the Administration
Committee.

 

(cc) “Plan Year” means the calendar year.

 

(dd) “Pre-AJCA Account” means a Pre-AJCA DIP Account or a Pre-AJCA Ex-CAP
Account.

 

  (1) “Pre-AJCA DIP Account” means the portion of any Account of a Participant
who terminated employment with the Company and Affiliates before January 1, 2005
that (A) is not a Pre-AJCA Ex-CAP Account and (B) constitutes amounts “deferred”
(within the meaning of section 885(d) of the AJCA) before January 1, 2005.

 

  (2) “Pre-AJCA Ex-CAP Account” means the portion of any Ex-CAP Account (as
defined in Section A-1) of a Participant who terminated employment with the
Company and Affiliates before January 1, 2005 that constitutes amounts
“deferred” (within the meaning of section 885(d) of Code and the AJCA) before
January 1, 2005.

No Participant shall have a Pre-AJCA Account unless he terminated employment
with the Company and Affiliates before January 1, 2005.

 

(ee) “Qualified Plan” means the MeadWestvaco Corporation Savings and Employee
Stock Ownership Plan for Salaried and Non-Bargained Hourly Employees.

 

 

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(ff) “Qualified Plan Limits” means the limits required by sections 401(a)(17),
401(k)(3), 402(g), and 415 of the Code, each as adjusted pursuant to section
414(v) of the Code.

 

(gg) “Restorative Savings Amount” means—

 

  (1) For any Plan Year that begins after December 31, 2006, any Base Salary for
services performed during such Plan Year that an Eligible Employee irrevocably
elected before such Plan Year to defer under the Qualified Plan as a “before-tax
contribution” (within the meaning of the Qualified Plan), but that cannot be
contributed to the Qualified Plan by reason of the Qualified Plan Limits.

 

  (2) For the 2006 Plan Year, any compensation for services performed during
such Plan Year that an Eligible Employee irrevocably elected before such Plan
Year to defer under the Qualified Plan as a “before-tax contribution” (within
the meaning of the Qualified Plan), but that cannot be contributed to the
Qualified Plan during such Plan Year by reason of the Qualified Plan Limits.

 

  (3) For the 2005 Plan Year, any amount that an Eligible Employee irrevocably
elected before such Plan Year to defer under the Qualified Plan as a “before-tax
contribution” (within the meaning of the Qualified Plan), but that cannot be
contributed to the Qualified Plan by reason of the Qualified Plan Limits.

 

(hh) “Specified Date Distribution” means a payment of all or part of a
Participant’s Account that is scheduled to commence during a specified Plan Year
in the future, as described in Section 7.02(a).

 

(ii) “Spouse” means the person, if any, to whom a Participant is legally married
under the laws of the state in which the Participant resides, and who qualifies
as a “spouse” within the meaning of 1 U.S.C. § 7.

 

(jj) “Termination Distribution” means a payment of all or part of a
Participant’s Account that commences at a time based on the Participant’s
Termination Date, as described in Section 7.02(b).

 

(kk) “Termination Date” means the date of an individual’s “separation from
service” (within the meaning of section 409A(a)(2)(A)(i) of the Code) with
(x) MeadWestvaco or the Designated Subsidiary with which he is employed and
(y) its Affiliates, as determined by MeadWestvaco in accordance with Treas. Reg.
§ 1.409A-1(h)(1). For purposes of the Plan:

 

  (1) An individual who is on a leave of absence (with the expectation that he
will return) and does not have a statutory or contractual right to reemployment
shall be deemed to have had a “separation for service” on the first date that is
more than six months after the commencement of such leave of absence. However,
if the leave of absence is due to any medically determinable physical or mental
impairment that can be expected to last for a continuous period of six months or
more, and such impairment causes the individual to be unable to perform the
duties of his position of employment or any substantially similar position of
employment, the preceding sentence shall be deemed to refer to a 29-month period
rather than to a six-month period; and

 

 

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  (2) A sale of assets to an unrelated buyer that results in an individual
working for the buyer or one of its affiliates shall not, by itself, constitute
a “separation from service” for such individual unless MeadWestvaco, with the
buyer’s written consent, so provides in writing 60 or fewer days before the
closing of such sale.

 

(ll) “Valuation Date” means any date or time designated by the Administration
Committee for the valuation of Accounts.

 

2.02. CONSTRUCTION

Effective January 1, 2003, for purposes of the Plan, unless the contrary is
clearly indicated by the context:

 

(a) The use of the masculine gender shall also include within its meaning the
feminine and vice versa;

 

(b) The use of the singular shall also include within its meaning the plural and
vice versa;

 

(c) The word “include” shall mean to include, but not to be limited to; and

 

(d) Any reference to a statute or section of a statute shall further be a
reference to any successor or amended statute or section, and any regulations or
other guidance of general applicability issued thereunder.

 

2.03. TIMING OF PAYMENTS

 

(a) The phrase “as soon as practicable after” or any similar phrase shall mean
the earliest administratively practicable date after the relevant date or event;
provided that, in accordance with Treas. Reg. § 1.409A-3(b), such date shall be
no later than the later of (1) the last day of the calendar year in which the
relevant date or event occurs or (2) the 90th day following the occurrence of
the relevant date or event.

 

(b) To the extent that any payment under the Plan may be made within a specified
number of days, or as soon as practicable, on or after any date or the
occurrence of any date or event, the date of payment shall be determined by the
Company in its sole discretion, and not by any Participant, beneficiary, or
other individual.

ARTICLE 3. PARTICIPATION

 

3.01. COMMENCING PARTICIPATION

 

(a) Each individual who was a Participant in the Plan on January 1, 2007 shall
remain a Participant until his participation ends pursuant to Section 3.02.

 

(b) Any individual who was not a Participant in the Plan on January 1, 2007 and
who becomes an Eligible Employee on or after January 1, 2007 shall be a
Participant as of the date an amount is first credited to his Account.

 

 

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(c) Any individual who is not already a Participant in the Plan and whose
account under the Mead Corporation Executive Capital Accumulation Plan was
transferred to the Plan effective January 1, 2007, shall be a Participant in the
Plan as of January 1, 2007.

 

3.02. ENDING PARTICIPATION

An individual who becomes a Participant shall remain a Participant until the
earlier of (a) his death or (b) the entire balance of his Account has been paid.

ARTICLE 4. CREDITS TO PARTICIPANTS’ ACCOUNTS

 

4.01. ELIGIBLE EMPLOYEE DEFERRALS

 

(a) Nature of Deferrals. For any Plan Year, subject to the rules and
restrictions set forth in this Section 4.01, each Eligible Employee may elect to
defer under the Plan receipt of any or all of the following amounts attributable
to such Plan Year:

 

  (1) His Restorative Savings Amount for such Plan Year;

 

  (2) Up to 80 percent of his Base Salary for services performed during such
Plan Year;

 

  (3) Up to 80 percent of his Commissions for such Plan Year; and

 

  (4) Up to 80 percent of his annual incentive awards (A) for services performed
during such Plan Year or (B) that constitute Performance-Based Compensation for
which the performance period ends during such Plan Year.

If an Eligible Employee makes a Deferral Election pursuant to this Section 4.01,
his earnings for the applicable payroll period shall be reduced by the amount
that he elects to defer, and the amount he elects to defer shall be credited to
his Account on or before the fifteenth day of the first month after the month in
which the applicable amount would otherwise be payable, in accordance with such
procedures as the Administration Committee may establish. Such Eligible Employee
shall waive any right to receive the amount deferred and shall receive instead
only any amounts payable pursuant to Article 7 and Article 8.

 

(b) Time and Manner of Deferral Elections.

Effective for Plan Years that begin after December 31, 2004:

 

  (1) Except as provided in subparagraph (2) or (3):

 

  (A) An Eligible Employee must file his Deferral Election (or any change to
such election) with the Plan’s recordkeeper, in a manner acceptable to the
Administration Committee, during Open Enrollment in the Plan Year immediately
preceding the Plan Year in which the services giving rise to the amount to be
deferred are performed; and

 

 

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  (B) Except as required by Section 8.01(d), each Deferral Election (or change
to the Deferral Election) shall be irrevocable during the Plan Year in which the
services giving rise to the amount deferred are performed.

 

  (2) With respect to Performance-Based Compensation, the Administration
Committee shall have discretion to allow Eligible Employees to file Deferral
Elections (or changes to such elections) after the deadline prescribed by
subparagraph (1), above; provided that:

 

  (A) The Eligible Employee performs services for the Company and/or its
Affiliates continuously from the later of (i) the beginning of the performance
period or (ii) the date the performance criteria are established (in accordance
with the requirements of Treas. Reg. § 1.409A-1(e)) through the date his
Deferral Election is filed; and

 

  (B) Such Deferral Election (or change thereto) is filed and irrevocable—

 

  (i) No later than six months before the end of the applicable performance
period, and

 

  (ii) Before such Performance-Based Compensation is both substantially certain
to be paid and readily ascertainable.

 

  (3) For the first Plan Year in which an individual is eligible to participate
in the Plan, if such Eligible Employee has not been eligible to participate in
any other 409A Account Plan, such Eligible Employee’s properly executed Deferral
Election may be delivered to the Plan’s recordkeeper after the deadline
prescribed by subparagraph (1), above; provided that: (A) such Deferral Election
is delivered to the recordkeeper no later than 30 days after such individual
first becomes eligible to participate in a 409A Account Plan, (B) such Deferral
Election applies only to compensation for services performed after such Deferral
Election is delivered to the recordkeeper, and (C) such Deferral Election is
irrevocable during such Plan Year.

 

  (4) If a Participant does not file an election before the first day of any
Plan Year after the first Plan Year in which he was eligible to participate in
the Plan, his Deferral Election from the prior Plan Year (if any) shall remain
in effect as if it had been re-filed and shall be irrevocable during such Plan
Year. (If the Participant does not have an election in effect for the prior Plan
Year, he shall be deemed to have made a Deferral Election of zero.)

 

(c) Amount of Deferrals.

 

  (1) An Eligible Employee who elects to defer his Restorative Savings Amount
must defer 100 percent of such Restorative Savings Amount for the applicable
Plan Year.

 

  (2) An Eligible Employee who elects to defer any amount other than his
Restorative Savings Amount must elect to defer at least $5,000, not including
his Restorative Savings Amount (and disregarding the possibility that the
Eligible Employee could terminate employment before deferring $5,000), for the
applicable Plan Year.

 

 

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  (3) All Deferral Elections pursuant to this Section 4.01 shall be subject to
such other rules as the Administration Committee may establish; provided that
such rules and regulations are not inconsistent with the provisions of the Plan.

 

(d) Limitation on Employee Deferrals. An Eligible Employee’s Deferral Election
for any payroll period shall be ineffective to the extent that the amount
deferred will reduce his non-deferred earnings to a level insufficient to pay
applicable employment and payroll taxes (including FICA and Medicare taxes).

 

4.02. EMPLOYER NON-QUALIFIED MATCHING CREDITS

 

(a) For each Plan Year with respect to which an Eligible Employee has made a
Deferral Election, in accordance with such procedures as the Administration
Committee may establish, a non-qualified matching credit shall be added to each
Eligible Employee’s Account, equal to—

 

  (1) 100 percent of the amount such Eligible Employee deferred for such Plan
Year pursuant to Section 4.01(a) up to a maximum of 3 percent of his Excess
Compensation for such payroll period; plus

 

  (2) 50 percent of the amount such Eligible Employee deferred for such Plan
Year pursuant to Section 4.01(a) to the extent such amount exceeds 3 percent of
his Excess Compensation for such Plan Year and does not exceed 5 percent of his
Excess Compensation for such Plan Year.

 

(b) Effective for any Plan Year beginning after December 31, 2006, and subject
to the requirements of this subsection (b), the Administration Committee shall
have discretion to add an additional non-qualified matching credit to the
Account of any Eligible Employee who timely filed an irrevocable election to
defer his Restorative Savings Amount for such Plan Year.

 

  (1) The amount of any matching credit added pursuant to this subsection
(b) shall be no greater than the excess, if any, of—

 

  (A) The amount of the Employer Matching Contributions (as defined in the
Qualified Plan) that would have been added to the Eligible Employee’s Qualified
Plan account if the Eligible Employee had deferred under the Qualified Plan the
full amount of compensation that he elected to defer under the Qualified Plan
for such Plan Year (pursuant to an irrevocable election filed before the
beginning of such Plan Year), determined without regard to the Qualified Plan
Limits, over

 

  (B) The sum of (i) the Employer Matching Contributions (as defined in the
Qualified Plan) actually added to the Eligible Employee’s Qualified Plan account
for such Plan Year, and (ii) the amount of the Eligible Employee’s non-qualified
matching credit for such Plan Year prescribed by subsection (a), above.

 

 

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  (2) No matching credit pursuant to this subsection (b) shall be added to any
Participant’s Account before the last day of the Plan Year for which it applies.
In order to be eligible to receive any matching credit pursuant to this
subsection (b), the Participant must be actively employed by the Company or one
of its Affiliates on the last day of such Plan Year.

 

  (3) Any matching credit added to a Participant’s Account pursuant to this
subsection (b) (adjusted for earnings, interest, gains, and losses) shall be
paid at the same time and in the same form as the Participant’s Restorative
Savings Amount for the Plan Year with respect to which such additional matching
credit is added to the Participant’s Account.

 

(c) The Administration Committee shall have discretion to determine when
non-qualified matching credits are added to Eligible Employees’ Accounts. Such
discretion shall include the discretion to credit all or part of the matching
credit required by this Section 4.02 on a payroll period or monthly basis, and
to credit matching credits for any Plan Year after the end of such Plan Year. No
credit shall be adjusted for earnings, interest, gains, or losses with respect
to any period before the date on which such credit is added to the Eligible
Employee’s Account.

ARTICLE 5. INVESTMENTS AND ACCOUNTS

 

5.01. PARTICIPANT ALLOCATION OF ACCOUNTS AMONG BOOK-ENTRY INVESTMENT FUNDS

 

(a) The Investment Policy Committee shall establish book-entry Investment Funds,
which shall include the MeadWestvaco Stock Unit Fund (an Investment Fund that
mirrors the MeadWestvaco Stock Fund under the Qualified Plan), for measuring
earnings or losses on Account balances.

 

(b) Amounts recorded in a Participant’s Account may be allocated by the
Participant, in any proportion (in 1 percent increments), among the book-entry
Investment Funds available under the Plan. Allocation requests shall be made by
a notification submitted in such manner and form, and at such time, as the
Administration Committee prescribes.

 

(c) If a Participant fails to make any allocation in accordance with this
Section 5.01, such unallocated funds shall be allocated to the Investment Fund
selected by the Investment Policy Committee.

 

(d) All non-qualified matching credits pursuant to Section 4.02 shall be
allocated initially to the MeadWestvaco Stock Unit Fund but may be transferred
from the MeadWestvaco Stock Unit Fund to other Investment Funds to the extent
permitted under Section 5.02.

 

5.02. CHANGE IN ALLOCATION

 

(a) At any time (but no more than once per day unless permitted by the Plan’s
recordkeeper),

 

 

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  (1) a Participant may change a previous investment election with respect to
future deferrals (not including matching credits, which are subject to
Section 5.01(d)) by submitting a notification to the Plan’s recordkeeper, in
such manner and form, and at such time, as the Administration Committee
prescribes, directing such a change; and

 

  (2) a Participant may direct that all or part of his Account allocated to a
particular Investment Fund be transferred to any of the other available
Investment Funds by submitting a notification to the Company in such manner and
form, and at such time, as the Administration Committee prescribes.

 

(b) A Participant may continue to direct the book-entry investment of his
Accounts in accordance with this Section 5.02 until the entire balance of his
Account is paid pursuant to Article 7 and Article 8. In addition, a Beneficiary
or former Spouse may continue to direct the investment of the portion of the
Participant’s Account to which such person is entitled in accordance with this
Section 5.02 until his interest in the Participant’s Account is fully paid.

 

(c) Any change in allocation (including any transfer) shall be specified in
either whole dollar or whole percentage increments and shall otherwise be
subject to such rules and procedures as the Administration Committee shall
establish.

 

5.03. VALUATION OF INVESTMENT FUNDS

 

(a) At the discretion of the Administration Committee, the Investment Funds
available under the Plan may be valued on a unitized basis.

 

(b) As of each Valuation Date, the Plan’s recordkeeper shall determine the
book-entry fair market value of the balances allocated to each Investment Fund.
Such value shall reflect (1) earnings (or losses) on each Investment Fund,
(2) new credits, (3) payments, and (4) expenses allocated to each Investment
Fund since the most recent Valuation Date.

 

5.04. SUB-ACCOUNTS

 

(a) The Plan’s recordkeeper shall establish sub-accounts for each Participant’s
Account as the Administration Committee or recordkeeper deems appropriate for
any Participant, such as sub-accounts to track Specified Date Distributions and
Pre-AJCA Accounts.

 

(b) Expenses and book-entry investment gains (and losses) shall be allocated
among the sub-accounts that comprise each Participant’s Account at such time and
in such manner as the Administration Committee shall prescribe.

 

(c) The balance of each Participant’s Account (and of each of the several
sub-accounts comprising the Participant’s Account) shall be updated as of each
Valuation Date to reflect all gains, losses, income, and expenses of the
Investment Funds to which the Account is allocated, and any payments and
expenses with respect to such Participant.

 

 

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5.05. RISK OF LOSS

Neither the Plan nor the Company guarantees that the fair market value of the
Investment Funds, or of any particular Investment Fund, will not decrease in
value or that the fair market value of any Participant’s Account will not
decline as a result of negative performance of book-entry investments pursuant
to this Article 5. Each Participant shall assume all risk of any decrease in the
balance of the Investment Funds and their Accounts, without regard to whether
such decrease results from an investment election made by the Company or by the
Participant.

 

5.06. INTERESTS IN THE PLAN

No Participant, Beneficiary, or former Spouse shall have any claim, right,
title, or interest in or to any specific assets until a payment is made to the
Participant, Beneficiary, or former Spouse. No Participant, Beneficiary, or
former Spouse has any claim, right, title, or interest in or to any specific
assets, except as and to the extent expressly provided herein.

 

5.07. SPECIAL PROVISIONS APPLICABLE TO THE COMPANY STOCK PORTION OF THE PLAN

 

(a) Trading Price. Any transfer of an amount into or out of the MeadWestvaco
Stock Unit Fund shall be executed using the same closing price of a share of
MeadWestvaco Common Stock as would apply for a comparable transfer into or out
of the MeadWestvaco Stock Fund under the Qualified Plan.

 

(b) Dividend Equivalents Under the MeadWestvaco Stock Unit Fund. Any credits in
a Participant’s Account allocated to the MeadWestvaco Stock Unit Fund shall be
increased whenever a dividend is paid on MeadWestvaco Common Stock. The number
of additional credits credited to a Participant’s Account as a result of such
increase shall be determined by (1) dividing the balance of a Participant’s
Account allocated to the MeadWestvaco Stock Unit Fund by the closing price of a
share of MeadWestvaco Common Stock on the composite tape of New York Stock
Exchange issues on the dividend record date (or if there was no reported sale of
MeadWestvaco Common Stock on such date, on the next preceding day on which there
was such a reported sale), and then (2) by multiplying the amount resulting from
the calculation in clause (1) by the amount of the dividend declared per share
of MeadWestvaco Common Stock on the dividend record date.

ARTICLE 6. VESTING AND FORFEITURE

 

6.01. VESTING

 

(a) Except as provided in Section 6.02, each Participant shall have a fully
vested, nonforfeitable interest in all amounts deferred under the Plan and
related earnings.

 

(b) A Participant’s vested interest shall not affect the Participant’s status as
a general creditor of the Company, on equal footing with all other unsecured
creditors of the Company, with respect to his Account balance.

 

 

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6.02. FORFEITURE

Subject to the requirements of section 409A of the Code (including the
limitations set forth in Treas. Reg. § 1.409A-3(j)(4)(xiii)), the amount of any
payment to or on behalf of any individual shall be subject to any claims the
Company may have against such individual. The remedies available to the Company
and Affiliates, at law or in equity, for any loss or other injury caused
directly or indirectly by a current or former Participant, shall not be limited
in any way.

ARTICLE 7. PAYMENTS

 

7.01. DISTRIBUTION ELECTION PROCESS

 

(a) Subject to the provisions of this Article 7, Section 1.03, Appendix B and
Appendix C, the Administration Committee shall establish procedures for
Participants to elect the time and manner in which their Accounts will be paid.

 

(b) Effective January 1, 2005, each Plan Year, during Open Enrollment (or when
an Eligible Employee makes a Deferral Election pursuant to Section 4.01(b)(2) or
(3)), each Eligible Employee shall file a Distribution Election specifying the
time (or times) and manner of payment of the deferrals and matching and other
credits attributable (as described in Sections 4.01(a) and 2.01(i)) to the
upcoming Plan Year. If an Eligible Employee does not make a Distribution
Election for any amount deferred or credited to his Account by the deadline for
making the corresponding Deferral Election, such amount (including associated
matching credits and earnings) shall be paid at the time and in the form
prescribed by Section 7.02(b)(2) (unless such time or form is changed in
accordance with the requirements of Section 7.04).

 

(c) Any Distribution Election that is not made in accordance with the procedures
established by the Administration Committee shall be ineffective and shall be
disregarded.

 

7.02. TYPES OF DISTRIBUTIONS

Subject to the provisions of this Article 7, Section 1.03, Appendix B and
Appendix C, a Participant may elect to receive a payment of all or part of his
Account on a specified date or after his Termination Date, in a form permitted
under Section 7.03. For purposes of determining the amount of any payment under
this Section 7.02, the balance of any Account shall be determined as of June 30
of the Plan Year in which such payment is made.

 

(a) Specified Date Distributions. Subject to the procedures and election
deadline prescribed by Section 7.01 and the restrictions set forth in this
Section 7.02(a), a Participant may elect a Specified Date Distribution in a form
permitted by Section 7.03.

 

  (1) Each Distribution Election form calling for a Specified Date Distribution
shall specify the Plan Year in which such Specified Date Distribution will
commence, which shall be no earlier than the second Plan Year after the Plan
Year in which the applicable Deferral Election was filed (or deemed to be filed,
in the case of a deemed election pursuant to Section 4.01(b)(4)).

 

 

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  (2) After the election deadline prescribed by Section 7.01, an election to
receive a Specified Date Distribution may be amended only in the manner and to
the extent permitted under Section 7.04.

 

  (3) Any deferrals and other credits with respect to which an Eligible Employee
elects to receive a Specified Date Distribution shall be segregated in a
separate sub-account of the Participant’s Account, to be separately adjusted to
reflect earnings and losses thereon pursuant to Article 5.

 

  (4) Each Specified Date Distribution shall commence as soon as practicable
after June 30 of the Plan Year elected by the Participant pursuant to paragraph
(a)(1), above. The Company shall make each payment as soon as practicable after
June 30 of the Plan Year in which such payment (whether an installment or a lump
sum) is due.

 

  (5) Each Specified Date Distribution shall be coordinated with the
Participant’s Termination Distribution, as follows:

 

  (A) If the Participant’s Termination Date (for a reason other than death)
occurs before the commencement date for the Specified Date Distribution:

 

  (i) If the Participant’s Termination Date occurs before the Participant’s 55th
birthday, the sub-account or sub-accounts associated with such Specified Date
Distribution shall be paid in the form that applies for the Participant’s
Termination Distribution (or, if the Participant has not elected a form, the
form prescribed by Section 7.02(b)(2)), commencing at the time prescribed by
Section 7.02(b)(1)(B).

 

  (ii) If the Participant’s Termination Date occurs on or after the
Participant’s 55th birthday, the sub-account or sub-accounts associated with
such Specified Date Distribution shall be paid in accordance with the
Participant’s Specified Date Distribution election, without regard to the
Participant’s termination of employment.

 

  (B) If the Participant’s Termination Date (for a reason other than death)
occurs after the commencement date for the Specified Date Distribution
(regardless of the Participant’s age), the sub-account or sub-accounts
associated with such Specified Date Distribution shall continue to be paid in
accordance with the Participant’s Specified Date Distribution election, without
regard to the Participant’s termination of employment (but subject to paragraph
(6), below).

 

  (6) Notwithstanding the form or time of payment elected by the Participant or
any other individual, if a Participant dies before he receives all or part of a
Specified Date Distribution, the Company shall pay any remaining balance in his
Account in accordance with Section 8.02.

 

 

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(b) Distributions Following Termination Date.

 

  (1) Subject to the procedures and election deadline prescribed by Section 7.01
and the restrictions set forth in this Section 7.02(b), a Participant may elect
that a Termination Distribution will commence, in a form permitted by
Section 7.03, as soon as practicable after June 30 of any Plan Year after the
Plan Year in which his Termination Date occurs, subject to the following
restrictions:

 

  (A) The elected Plan Year of commencement must be no later than the earlier
of—

 

  (i) The tenth Plan Year following the Participant’s Termination Date, or

 

  (ii) The Plan Year next following the later of (I) the Plan Year in which the
Participant attains age 70 or (II) the Plan Year in which the Participant’s
Termination Date occurs.

 

  (B) If the Participant’s Termination Date (for a reason other than death)
occurs before his 55th birthday, his election as to the time of payment shall
not apply and payment shall commence as soon as practicable after (I) June 30 of
the Plan Year next following the Plan Year in which such Participant’s
Termination Date occurs or (II) such later commencement date as required by
reason of a change in election previously filed under Section 7.04(a).

 

  (C) Notwithstanding the form or time of payment elected by the Participant or
any other individual, if the Participant dies before his entire Account is paid,
the Company shall pay his Account in accordance with Section 8.02.

 

  (2) Subject to Section 7.04, any portion of a Participant’s Account with
respect to which the Participant did not file a valid and timely Distribution
Election shall be paid in a lump sum as soon as practicable after June 30 of the
Plan Year next following the Plan Year in which the Participant’s Termination
Date occurs. For purposes of this Section 7.02(b)(2), a deemed election under
Section 4.01(b)(4) shall be treated as a valid and timely Distribution Election.
If the Participant dies before all or part of his Account is paid pursuant to
this Section 7.02(b)(2), his Account shall be paid in accordance with
Section 8.02.

 

7.03. FORM OF PAYMENT OF DISTRIBUTIONS

 

(a) Except as otherwise provided in paragraph (b), below, all payments pursuant
to this Article 7 shall be in the form of a lump sum.

 

(b) At the time that he makes a Distribution Election with respect to any amount
(in accordance with Section 7.01(b)), a Participant may elect to receive the
portion of his Account that is attributable to such amount in annual
installments or a combination of annual installments and a partial lump sum,
subject to the following restrictions:

 

  (1) Effective January 1, 2005, in the case of a Specified Date Distribution,
the number of annual installments shall not exceed five.

 

 

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  (2) In the case of a Termination Distribution:

 

  (A) The number of annual installments shall not exceed 20, and

 

  (B) If the vested balance of a Participant’s Account as of June 30 of the Plan
Year in which payments are scheduled to commence is $50,000 or less, such vested
balance shall be paid to the Participant in a lump sum; and

 

  (C) No partial lump sum shall be paid to any Participant whose Termination
Date occurs before he attains age 55. If Participant’s age as of his Termination
Date is less than 55, any Termination Distribution that is scheduled to be paid
in a combination of annual installments and a partial lump sum shall be paid in
annual installments over the scheduled number of years, without the partial lump
sum.

 

  (3) To the extent that payments are to be made in annual installments, the
amount of each annual installment shall be equal to the balance of the
applicable Account as of June 30 of the applicable Plan Year divided by the
number of annual installments remaining to be paid.

 

7.04. CHANGES TO THE TIME AND FORM OF DISTRIBUTION

 

(a) Effective January 1, 2005, a Participant may change the time or form in
which all or a portion of his Account (not including any Pre-AJCA Account, which
shall be subject to the provisions of Appendix B and Appendix C) will be paid
only to the extent permitted by the Administration Committee, in accordance with
any rules or procedures that the Administration Committee may establish. Such
rules or procedures established by the Administration Committee shall be
designed to avoid adverse tax consequences and, except as permitted under the
special transition rules set forth in paragraph (b), below, shall comply with
the following restrictions:

 

  (1) Any change must be filed with the Plan’s recordkeeper before the
Participant’s Termination Date.

 

  (2) The time or schedule for payment of all or part of a Participant’s Account
shall not be accelerated, unless the Administration Committee determines that
such acceleration would not result in adverse tax consequences under section
409A of the Code or other applicable tax doctrines. The Administration Committee
shall have discretion to accelerate payments to the extent (and only to the
extent) permitted by Treas. Reg. § 1.409A-3(j)(i) through (xiv).

 

  (3) The time or schedule for payment may be delayed and the form of payment
may be changed only if: (A) the Participant’s election is filed with the Plan’s
recordkeeper at least 12 months before the date of the first payment from the
sub-account to which such election applies would be made if not for such
election and (B) the Participant’s election results in payment being delayed for
at least five years from the date payment otherwise would have been made. For
purposes of this rule, the payment date in any Plan Year shall be deemed to be
July 1 of such Plan Year.

 

 

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Where an amount is scheduled to be paid upon more than one alternative date or
event (such as the earliest of a fixed date, the Participant’s Termination Date,
or his death), the requirements of this Section 7.04(a)(3) shall be applied
separately with respect to each date or event, in accordance with Treas. Reg.
§ 1.409A-2(b)(6).

 

(b) Special Transition Rules

 

  (1) Papers Participants. Any Participant whose employment was terminated as of
May 1, 2005 as a result of MeadWestvaco’s divestiture of its Papers business (a
“Papers Participant”) may make a one-time election, to be filed with the Plan’s
recordkeeper on or before May 20, 2005, to change the time and/or form in which
all or part of his Account is paid; provided that:

 

  (A) The elected commencement date shall not be before July 2006;

 

  (B) The elected form shall be either a lump sum or annual installments over a
period of 20 or fewer years; and

 

  (C) If, as of the Papers Participant’s elected commencement date, the vested
balance of his Account is less than or equal to $50,000, such vested balance
shall be paid in a lump sum.

 

  (2) AJCA Transition. Prior to January 1, 2009, or such earlier deadline as
established by the Administration Committee, any Participant may elect to change
the time and/or form in which all or part of his Account (not including any
Pre-AJCA Account, which shall be subject to the provisions of Appendix B or
Appendix C, as applicable) is paid; provided that:

 

  (A) Such election shall not become effective unless such election is filed
with the Plan’s recordkeeper (i) before the Participant’s Termination Date and
(ii) at least 12 months before the date the first payment from the sub-account
to which such election applies would be made if not for such election;

 

  (B) Payments pursuant to such election shall commence no earlier than 12
months after such election is filed with the Plan’s recordkeeper; and

 

  (C) The elected form of payment shall be a form permitted under Section 7.03.

After December 31, 2008, or such earlier deadline as established by the
Administration Committee, any election pursuant to this Section 7.04(b)(2) may
be amended only to the extent permitted under Section 7.04(a).

 

 

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(c) Rules of Construction

 

  (1) For purposes of this Section 7.04, a series of installment payments shall
be treated as a single payment. A combination of installments and a lump sum
shall be treated as two separate payments: (A) the lump sum and (B) the series
of installments.

 

  (2) Any election to change the time or form of payment of all or part of a
Participant’s Account that does not comply with the rules and procedures
established by the Administration Committee, or that is otherwise inconsistent
with the restrictions set forth in this Section 7.04, shall be null and void.

 

(d) Discontinuation of Unscheduled Distributions. Effective January 1, 2005,
unscheduled distributions (other than hardship withdrawals in accordance with
Section 8.01) shall not be permitted; provided that the provisions for
unscheduled distributions in effect as of October 3, 2004, as set forth in
Appendix B and Appendix C, shall remain in effect for Pre-AJCA Accounts.

 

7.05. PRE-AJCA ACCOUNTS

Effective January 1, 2005, the provisions of this Article 7 shall not apply for
any Pre-AJCA Account. Pre-AJCA DIP Accounts shall be paid in accordance with
Section B-3, except as provided in Section B-4. Pre-AJCA Ex-CAP Accounts shall
be paid in accordance with Sections C-3 through C-5.

ARTICLE 8. HARDSHIP WITHDRAWALS AND PAYMENTS UPON DEATH

 

8.01. HARDSHIP WITHDRAWAL.

Effective January 1, 2005, subject to approval by the Administration Committee,
a Participant who is actively employed by the Company and who satisfies the
requirements of this Section 8.01 may receive a lump-sum hardship withdrawal of
a portion of his Account (not including any Pre-AJCA Account, which shall be
subject to the provisions of Appendix B or Appendix C, as applicable) in case of
an “unforeseeable emergency.”

 

(a) For purposes of this Section 8.01, an “unforeseeable emergency” is a severe
financial hardship of the Participant resulting from:

 

  (1) An illness or accident of the Participant or his Spouse or dependent (as
defined in section 152(a) of the Code),

 

  (2) Loss of the Participant’s property due to casualty (including the need to
rebuild a home following damage to a home not otherwise covered by insurance,
for example, as a result of a natural disaster), or

 

  (3)

Such other similar extraordinary and unforeseeable circumstances arising as a
result of events beyond the control of the Participant (such as imminent
foreclosure or eviction from the Participant’s primary residence, the need to
pay

 

 

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medical expenses, including non-refundable deductibles and prescription drugs,
and the need to pay funeral expenses for the Participant’s Spouse or dependent
(as defined in section 152(a) of the Code)), as determined by the Administration
Committee.

In no case may the need to send a child to college or the desire to purchase a
home constitute an “unforeseeable emergency.”

 

(b) If a Participant seeks to receive a payment pursuant to this Section 8.01,
the Participant shall present such evidence and certifications as the
Administration Committee or the Plan’s recordkeeper considers necessary to
determine whether the Participant meets the requirements of this Section 8.01.

 

(c) The amount of any payment pursuant to this Section 8.01 shall not exceed the
amount reasonably required to satisfy the emergency need, taking into account
both cessation of deferrals pursuant to paragraph (d), below, and the extent to
which the Participant’s unforeseeable emergency is or may be relieved through—

 

  (1) Reimbursement or payment by insurance or otherwise;

 

  (2) A commercial loan or a loan under the Qualified Plan;

 

  (3) A hardship withdrawal under the Qualified Plan;

 

  (4) Liquidation of the Participant’s assets, to the extent the liquidation of
such assets would not itself cause severe financial hardship; or

 

  (5) Cessation of deferrals under the Qualified Plan or any other tax-qualified
retirement plan maintained by the Company or an Affiliate.

 

(d) If a Participant receives a payment pursuant to this Section 8.01—

 

  (1) His Deferral Elections for the remainder of the Plan Year in which such
hardship withdrawal is paid shall be canceled;

 

  (2) Any deferral election previously filed by the Participant under any other
nonqualified deferred compensation arrangement maintained by the Company or an
Affiliate shall be canceled; and

 

  (3) The Participant shall not be permitted to file any further Deferral
Elections (or any deferral elections pursuant to any other plan maintained by
the Company or an Affiliate) with respect to the Plan Year during which such
hardship withdrawal is paid.

 

8.02. PAYMENTS UPON DEATH

Upon the death of a Participant (whether or not the Participant is employed by
MeadWestvaco or an Affiliate at the time of death), the Company shall pay any
remaining balance in the Participant’s Account to the Participant’s Beneficiary
or Beneficiaries in a lump sum

 

 

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as soon as practicable after the Participant’s death. For purposes of this
Section 8.02, the remaining balance in the Participant’s Account shall be
determined as of the last day of the calendar month immediately preceding the
calendar month in which the lump-sum payment required by this Section 8.02 is
made.

 

8.03. DESIGNATION OF BENEFICIARY

A Participant shall be entitled to make a beneficiary designation in the form
and manner authorized by the Administration Committee. In the event that a
Participant has not properly designated a Beneficiary, his Beneficiary or
Beneficiaries shall be the same beneficiary or beneficiaries as under the
Qualified Plan.

 

8.04. PRE-AJCA ACCOUNTS

Effective January 1, 2005, the provisions of this Article 8 shall not apply with
respect to any Pre-AJCA Account, except as provided in Sections B-4 and C-4 with
respect to Beneficiary designations. Hardship withdrawals and post-death payment
of any Pre-AJCA DIP Account shall be governed by Section B-3. Hardship
withdrawals and post-death payment of any Pre-AJCA Ex-CAP Account shall be
governed by Sections C-3 and C-4.

ARTICLE 9. PLAN ADMINISTRATION

 

9.01. PLAN ADMINISTRATOR

The individuals or committee(s) appointed by the Chief Executive Officer of
MeadWestvaco to administer the Qualified Plan shall also administer this Plan,
unless such Chief Executive Officer appoints different individuals (or a
different committee) to administer this Plan. The authority to administer the
Plan shall not include the power to amend the Plan, to determine funding policy,
or to appoint actuaries or independent accountants, which powers are reserved by
the Board of Directors (except as provided in Section 10.01(b).

 

9.02. DELEGATION AND EMPLOYMENT OF AGENTS

Instruments designating a named individual or committee may grant to such named
individual or committee the power to designate other persons to carry out the
responsibilities delegated to such individual or committee. Any individual or
committee designated by the Chief Executive Officer of MeadWestvaco, or by an
individual or committee designated by the Chief Executive Officer of
MeadWestvaco, may employ one or more persons to render advice or to assist with
regard to any responsibility such individual or committee has under the Plan.

 

9.03. INTERPRETATIONS

All interpretations pertaining to facts or provisions of the Plan made by the
Plan Administrator or the Administration Committee shall be made in the complete
and exclusive discretion of the Plan Administrator or Administration Committee,
as applicable, and shall be binding and conclusive on all parties. The Plan
Administrator or Administration Committee, as appropriate, shall have the
complete and exclusive discretion to resolve ambiguities and inconsistencies in
the language of the Plan and to supply omissions in the language of the Plan.

 

 

MEADWESTVACO CORPORATION   2007 RESTATEMENT DEFERRED INCOME PLAN   PAGE 21

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9.04. ELECTIONS AND DESIGNATIONS

All elections and designations that Participants are required or permitted to
make under the Plan shall be made in writing or electronically in the form
prescribed by the Administration Committee or the Plan’s recordkeeper (or their
designees).

 

9.05. CLAIMS

Claims for participation in or benefits under the Plan shall be filed in
accordance with procedures established by the Plan Administrator, in such form
as shall be acceptable to the Company. In the absence of a separate written
claims procedure, the claims procedure under the Qualified Plan shall apply
under the Plan.

 

9.06. POSTPONEMENT OF ACTION

In the event that any dispute shall arise as to any act to be performed by the
Plan Administrator, the Plan Administrator may postpone the performance of such
act until actual adjudication of such dispute shall have been made in a court of
competent jurisdiction or until the Plan Administrator shall be indemnified by
the Company against any liability.

ARTICLE 10. AMENDMENT AND TERMINATION OF PLAN

 

10.01. AMENDMENT OF THE PLAN

 

(a) The Company reserves the right, at any time and from time to time, to amend
in whole or in part, either retroactively or prospectively, any or all of the
provisions of this Plan without notice to or the consent of any Participant or
Beneficiary hereunder; provided, however, that no amendment shall:

 

  (1) Reduce any Participant’s vested Account balance, except to the extent that
a reduction results from (A) an amendment described in Section 1.03(a)(4) or
(B) an amendment that the Company determines is necessary or appropriate to
conform the Plan to mandatory provisions of applicable federal or state laws,
regulations, or rulings or to secure or maintain favorable tax treatment of
amounts deferred under the Plan;

 

  (2) Constitute or result in a “material modification” of the Plan (within the
meaning of section 885(d) of the AJCA) with respect to any Pre-AJCA Account,
unless, and only to the extent that, the amendment or other action that could
constitute a “material modification” expressly states that it is intended to
constitute a “material modification” of the Plan with respect to one or more
Pre-AJCA Accounts; or

 

  (3) Be effective to the extent that it would result in a violation of any
requirement under section 409A of the Code.

 

 

MEADWESTVACO CORPORATION   2007 RESTATEMENT DEFERRED INCOME PLAN   PAGE 22

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(b) Any amendment of this Plan may be adopted by resolution of the Board of
Directors. In addition, the Chairman of the Board of Directors, the Chief
Executive Officer of MeadWestvaco, the President of MeadWestvaco, and the Senior
Vice President of MeadWestvaco with responsibility for Human Resources may make
any amendment which: (1) may be necessary or desirable to improve the
administration of the Plan, so long as such amendment does not materially affect
the substance of the Plan or the level of benefits the Plan provides or (2) may
be required to comply with various federal or state laws (including tax laws
that might result in adverse tax consequences to any Participant, the Company,
or an Affiliate).

 

10.02. TERMINATION OF THE PLAN

 

(a) Reservation of Right to Terminate. Although the Company expects to continue
the Plan indefinitely, the Company reserves the right to terminate the Plan,
partially or in its entirety, without notice to or the consent of any
Participant or Beneficiary, by a written resolution of the Board of Directors.

 

(b) Date of Termination. If the Board of Directors adopts a resolution to
terminate the Plan, the Plan shall be terminated as of a date to be specified in
the resolution.

 

(c) Rights of Affected Participants. In the event of the termination or partial
termination of the Plan, or the discontinuance of deferrals and credits to the
Plan, the balance of any Participant’s Account and timing of payments of such
balance shall remain unchanged, unless (1) the Participant consents otherwise
and (2) MeadWestvaco determines that the change would not result in adverse tax
consequences under section 409A of the Code (e.g., the change is permitted by
Treas. Reg. § 1.409A-3(j)(4)(ix)).

 

10.03. DESIGN DECISIONS

Decisions regarding the design of the Plan shall be made in a settlor capacity.
The act of modifying, altering, amending, or terminating the Plan shall be taken
on behalf of the Company as employer sponsor of the Plan, and shall not be
construed under any circumstances as an act taken in a fiduciary capacity under
or with respect to the Plan.

ARTICLE 11. MISCELLANEOUS PROVISIONS

 

11.01. EMPLOYMENT RIGHTS NOT AFFECTED BY PLAN

The adoption and maintenance of the Plan shall not be deemed to constitute a
contract between the Company or an Affiliate and any employee or other service
provider. Nothing herein contained shall be deemed to give to any individual the
right to be retained in the employ of the Company or an Affiliate or to
interfere with the right of the Company or an Affiliate to discharge any service
provider.

 

 

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11.02. DOUBT AS TO IDENTITY

 

(a) If, after reasonable efforts, the Administration Committee is unable to
determine the whereabouts of any person entitled to payment hereunder, the
Accounts of such person shall be deemed paid in accordance with the required
payment schedule, and the Administration Committee shall take (or cause to be
taken) all steps that it determines to be reasonably appropriate to avoid a
violation of section 409A of the Code (e.g., withholding income taxes at the
time of each deemed payment, and depositing the amount withheld with the
Internal Revenue Service). For purposes of the preceding sentence, notice by
registered mail sent to such person’s most recent address (as reflected in the
Plan records) shall be deemed to constitute reasonable efforts to locate such
person. Subject to the requirements of section 409A of the Code, if such person
subsequently makes a proper claim to the Company for such sum, the Company may
in its discretion pay to such person the net amount (after withholding) of the
deemed payment described in this Section 11.02(a).

 

(b) If a payment is made to a Participant, Beneficiary, or former Spouse as
provided under the Plan, the payment is not returned as being undeliverable, and
the check on which the payment is made is not presented for payment before such
time as the check expires, then the amount of the check may be forfeited.
However, subject to the requirements of section 409A of the Code, if such
Participant, Beneficiary, or former Spouse subsequently makes a proper claim for
the amount of the uncashed benefit check, the Company may in its discretion
issue a replacement check.

 

11.03. PAYMENT MEDIUM

All payments under this Plan shall be made in cash.

 

11.04. OBLIGATIONS TO MAKE PAYMENTS

Any obligation of the Company, MeadWestvaco, or any Designated Subsidiary to
make a payment under the Plan may be satisfied by MeadWestvaco or the applicable
Designated Subsidiary (a) making the payment or (b) causing another party, such
as an Affiliate or the trustee of an unsecured trust, to make the payment.

 

11.05. LIABILITY LIMITED

Except as otherwise provided by applicable law, no liability shall attach to or
be incurred by the shareholders, directors, officers, or employees of the
Company or any Affiliate under or by reason of any of the terms and conditions
contained in the Plan or in any of the contracts procured pursuant thereto or
implied therefrom.

 

11.06. OVERPAYMENTS

To the extent permitted by section 409A of the Code, if any overpayment of
benefits is made under the Plan, the amount of the overpayment may be set off
against further amounts payable to or on behalf of the person who received the
overpayment until the overpayment has been recovered. The foregoing remedy is
not intended to be exclusive.

 

 

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11.07. INCAPACITY AND MINOR STATUS

If any individual is a minor or unable to care for his affairs because of
illness or accident, unless a duly qualified guardian or other legal
representative has been appointed, any payment due from the Plan to that
individual may be paid, for the benefit of such individual, to his Spouse,
parent, brother, sister, or other person deemed by the Administration Committee
to have incurred expenses for such person. Such payment, to the extent thereof,
shall discharge all liability for such payment under the Plan.

 

11.08. ASSIGNMENT AND LIENS

 

(a) Nonalienability of Benefits. Subject to paragraph (b), below, the right of
any person to any benefit or payment under the Plan shall not be subject to
alienation, transfer, assignment, or encumbrance, or otherwise subject to lien,
and any such attempt to alienate, transfer, assign, or encumber any benefit or
payment under the Plan shall be null and void.

 

(b) Exception for Transfers Incident to Divorce. Paragraph (a), above, shall not
apply to payments made pursuant to a qualified domestic relations order (as
defined in section 414(p)(1)(A) of the Code) applicable to this Plan. Any
domestic relations order shall be subject to the terms of the Qualified Plan
with respect to any such orders, except that all qualified domestic relations
orders shall be construed and executed in a manner consistent with the terms of
the Plan and the requirements of section 409A of the Code.

 

11.09. WITHHOLDING TAXES

The Administration Committee may make any appropriate arrangements to deduct
from all amounts paid under the Plan, or to collect, any taxes reasonably
determined to be required to be withheld under applicable laws. Irrespective of
whether withholding is required, the Participant, Beneficiary, or surviving or
former Spouse, as the case may be, shall bear all taxes on amounts paid under
the Plan, on any imputed income resulting from the operation of the Plan, and on
any other payments or compensation from the Company or an Affiliate.

 

11.10. TITLES AND HEADINGS NOT TO CONTROL

The titles to articles and the headings of sections, subsections, paragraphs,
and clauses in the Plan are placed herein for convenience of reference only, and
in the event of any conflict, the text of the Plan, rather than such titles or
headings, shall control.

 

11.11. NOTICE OF PROCESS

In any action or proceeding involving the Plan, the Company and the
Administration Committee are the only necessary parties, and no Participant,
Beneficiary, former Spouse, or other person having or claiming to have an
interest under the Plan shall be entitled to any notice of process unless such
notice is required by applicable law.

 

 

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11.12. PLAN EXPENSES

All reasonable expenses incurred in the administration of the Plan may be
charged against Participants’ accounts in such manner as the Administration
Committee determines to be reasonable.

 

11.13. GOVERNING LAW AND LIMITATION ON ACTIONS

 

(a) The Plan shall be construed, administered, and regulated in accordance with
the provisions of federal law, and, to the extent not preempted thereby, in
accordance with the laws of the Commonwealth of Virginia, excluding any
conflicts or choice of law rule or principle that might otherwise refer
construction or interpretation of the Plan to the substantive law of another
jurisdiction.

 

(b) No claim for non-payment or underpayment of benefits allegedly owed by the
Plan (regardless of whether such benefits are allegedly due under the terms of
the Plan or by reason of any law) may be filed in court until the claimant has
exhausted the claims review procedures established in accordance with
Section 9.05. Claims for underpayment or non-payment of benefits must be filed
in a court located with jurisdiction to hear the claim no later than thirty-six
(36) months after the date when the payment of the benefit commenced or the date
when the first payment was allegedly due, as applicable. The running of the
thirty-six (36) month limitations period shall be suspended during the time that
any request for review of the claim pursuant to Section 9.05 is pending before
the Administration Committee. The foregoing limitations period is expressly
intended to replace and to supersede any limitations period that might otherwise
be deemed applicable under state or federal law in the absence of this
Section 11.13. Claims filed after the expiration of the limitations period
prescribed by this Section 11.13 shall be deemed to be time-barred.

 

11.14. CLASS ACTION FORUM SELECTION CLAUSE

 

(a) To the fullest extent permitted by law, any lawsuit associated with a
putative class action lawsuit relating in any way to the Plan or the
administration of the Plan shall be filed in one of the following jurisdictions:
(1) the jurisdiction in which the Plan is principally administered or (2) the
jurisdiction in which the largest number of putative class members resides (or
if that jurisdiction cannot be determined, the jurisdiction in which the largest
number of class members is reasonably believed to reside). If any such lawsuit
is filed in a jurisdiction other than the one described in the previous
sentence, then the Plan, any Plan affiliates, and all alleged Plan participants
shall take all necessary steps to have the lawsuit removed to, transferred to,
or re-filed in the jurisdiction described in the previous sentence.

 

(b) This Section 11.14 does not relieve the Plan or any putative litigant or
class member of any obligation existing under the Plan or by law to exhaust
administrative remedies (including the applicable claims procedures) before
initiating litigation or to comply with the limitation of actions provision set
forth in Section 11.13(b).

 

 

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11.15. SEVERABILITY

If any provision of the Plan should be held illegal or invalid for any reason,
such illegality or invalidity shall not affect the remaining parts of the Plan,
and the Plan shall be construed and enforced as if such illegal or invalid
provision had never been inserted herein.

 

11.16. INTEGRATION CLAUSE AND COMPLETE STATEMENT OF PLAN

This document is a complete statement of the Plan and, as of the effective date
hereof, supersedes all prior plan documents. No Participant, Beneficiary, former
Spouse, or any other person shall be entitled to or have any vested right in or
claim to a benefit under the Plan, except as expressly provided herein. The
Company shall from time to time issue to Participants one or more booklets or
brochures or make presentations summarizing the Plan. In the event of any
conflict between the terms of the Plan document and the terms of any such
booklets, brochures, and presentations summarizing the Plan, the terms of the
Plan document shall control.

*    *    *

IN WITNESS WHEREOF the undersigned has executed this restatement of the Plan.

 

/s/ John A. Luke, Jr.

John A. Luke, Jr. Chairman and Chief Executive Officer

 

APPROVALS LAW DEPARTMENT By  

/s/ John J. Carrara

  John J. Carrara  

Associate General Counsel and

Assistant Secretary

FILED: December 30, 2008 By  

/s/ Wendell L. Willkie, II

  Wendell L. Willkie, II   Senior Vice President, General Counsel and Secretary

 

 

MEADWESTVACO CORPORATION   2007 RESTATEMENT DEFERRED INCOME PLAN   PAGE 27

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APPENDIX A. TRANSFER OF EX-CAP BALANCES

Effective January 1, 2007 (the “Merger Date”), The Mead Corporation Executive
Capital Accumulation Plan (the “Ex-CAP”) is merged into the Plan. From and after
the Merger Date:

 

A-1. Amounts deferred under the Ex-CAP shall be credited to sub-accounts
established pursuant to Section 5.04 of the Plan (the “Ex-CAP Accounts”). Any
individual with an account balance under the Ex-CAP who is not already a
Participant in the Plan shall become a Participant in the Plan on the Merger
Date.

 

A-2. Except as otherwise provided in this Appendix A, each Participant’s Ex-CAP
Account shall be subject to the terms of the Plan, as in effect and amended from
time to time.

 

A-3. Subject to the Participant’s right to change the time or form of payment
pursuant to Section 7.04 of the Plan (or, for Pre-AJCA Ex-CAP Accounts, Appendix
C):

 

  (a) The Company shall pay each Participant’s Ex-CAP Account in accordance with
his most recent distribution election that is valid under the Terms of the Plan
and the AJCA (as determined by the Administration Committee in its sole
discretion) under the Ex-CAP filed prior to the Merger Date.

 

  (b) If any Participant has not filed a valid distribution election with
respect to all or part of his Ex-CAP Account prior to the Merger Date, the
Company shall pay any amount to which a valid distribution election does not
apply in a lump sum as soon as practicable after June 30 of the Plan Year next
following the Plan Year in which his Termination Date occurs.

 

  (c) If any Participant dies before his entire Ex-CAP Account has been paid,
the Company shall pay the remaining vested balance of his Ex-CAP Account to his
Beneficiary in accordance with Section 8.02 of the Plan.

 

 

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APPENDIX B. DISTRIBUTION OF PRE-AJCA DIP ACCOUNTS

 

B-1. APPLICABILITY

This Appendix B applies only for Pre-AJCA DIP Accounts, as defined in
Section 2.01(dd)(1) of the Plan. This Appendix B sets forth the rules relating
to form and time of payment for Pre-AJCA DIP Accounts that applied under the
Pre-AJCA DIP (as defined below).

 

B-2. DEFINITIONS

For purposes of this Appendix B—

 

  (a) “Gross Misconduct” means conduct, including a Pre-AJCA DIP Participant’s
performance, that the Company determines is cause for terminating the
Participant’s employment. Gross Misconduct includes engaging in fraud,
misappropriation, embezzlement, neglect of duties and responsibilities,
insubordination, or any other material violation of the Company’s policies and
procedures.

 

  (b) “Pre-AJCA DIP” means the MeadWestvaco Corporation Deferred Income Plan as
in effect on October 3, 2004.

 

  (c) “Pre-AJCA DIP Participant” means a Participant who (i) terminated
employment with the Company and Affiliates before January 1, 2005, and (ii) has
a Pre-AJCA DIP Account.

 

  (d) “Pre-AJCA DIP Termination Date” means the date, before January 1, 2005, on
which a Pre-AJCA DIP Participant’s employment with the Company ended, other than
by death, including the date on which a Pre-AJCA DIP Participant retired, quit,
or was discharged.

 

  (e) “Pre-AJCA DIP Termination Distribution” means a distribution of all or
part of a Participant’s Pre-AJCA DIP Account, scheduled to commence after his
Pre-AJCA DIP Termination Date, in accordance with Section B-3(b).

 

  (f) “Pre-AJCA DIP Unforeseeable Emergency” means a severe financial hardship
resulting from—

 

  (i) a sudden and unexpected illness or accident of the Pre-AJCA DIP
Participant or his dependent (as defined in section 152(a) of the Code);

 

  (ii) loss of the Pre-AJCA DIP Participant’s property due to casualty; or

 

  (iii) such other similar extraordinary and unforeseeable circumstances, as
approved by the Administration Committee in a non-discriminatory manner, arising
as a result of events beyond the Pre-AJCA DIP Participant’s control.

 

 

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In no case may the need to send a child to college or the desire to purchase a
home constitute a Pre-AJCA DIP Unforeseeable Emergency.

 

B-3. SCHEDULED DISTRIBUTION OF PRE-AJCA DIP ACCOUNTS

 

  (a) Scheduled Distribution Elections

 

  (i) The Company shall pay Pre-AJCA DIP Accounts in accordance with Pre-AJCA
DIP Participant distribution elections made pursuant to such procedures
established by the Administration Committee as were in effect on October 3,
2004. Any distribution election not made in accordance with such procedures
shall be ineffective and shall be disregarded.

 

  (ii) If a Pre-AJCA DIP Participant terminates employment with the Company
without an Pre-AJCA DIP effective distribution election, the Company shall pay
his Pre-AJCA DIP Account in accordance with Section B-3(b)(iii).

 

  (b) Scheduled Distributions Following Termination of Employment

 

  (i) To the extent properly elected, a Pre-AJCA DIP Termination Distribution
shall commence (in a form permitted under Section B-3(c)) in a Plan Year after
the Participant’s Pre-AJCA DIP Termination Date.

 

  (A) If the Pre-AJCA Termination Date occurs prior to the date on which the
Pre-AJCA DIP Participant attains age 55, distribution shall commence as soon as
practicable after June 30 of the calendar year following the Pre-AJCA DIP
Termination Date.

 

  (B) If the Pre-AJCA DIP Termination Date occurs on or after the date on which
the Pre-AJCA DIP Participant attains age 55, and the reason for termination is
not Gross Misconduct, distribution shall commence no later than the earliest
administratively practicable date after June 30 in the earlier of the (1) tenth
calendar year following his Pre-AJCA DIP Termination Date; or (2) the calendar
year in which he attains age 70.

 

  (C) If a Pre-AJCA DIP Participant’s employment with the Company is terminated
for Gross Misconduct, distribution of his Pre-AJCA DIP Account shall commence as
soon as practicable after June 30 of the calendar year following the his
Pre-AJCA DIP Termination Date. The amount of any distribution to any individual
whose employment is terminated for Gross Misconduct shall be subject to any
claims the Company may have against such individual arising from such Gross
Misconduct.

 

  (ii) Notwithstanding any election by a Pre-AJCA DIP Participant to receive an
in-service distribution pursuant to Section 7.02(a) of the Pre-AJCA DIP, if a
Pre-AJCA DIP Participant terminated employment prior to receiving all or part of
such distribution, the distribution election shall be canceled (to the extent
unpaid) and the sub-account or sub-accounts associated with such distribution
shall be distributed in accordance with the terms of his Pre-AJCA DIP
Termination Distribution election.

 

 

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  (iii) If a Pre-AJCA DIP Participant terminated employment without an effective
Pre-AJCA DIP Termination Distribution election, his Pre-AJCA DIP Account
(including sub-accounts associated with any unpaid portions of any in-service
distribution pursuant to Section 7.02(a) of the Pre-AJCA DIP) shall be
distributed in a single lump sum, as soon as practicable after June 30 of the
calendar year following the calendar year in which his Pre-AJCA DIP Termination
Date occurs.

 

  (iv) If a Pre-AJCA DIP Participant terminated employment with an effective
Pre-AJCA DIP Termination Distribution election that does not apply to the entire
balance in his Pre-AJCA DIP Account, (A) distribution of the portion of the
Pre-AJCA DIP Account to which a Pre-AJCA DIP Termination Distribution election
applies shall commence in accordance with the terms of such election, and
(B) the remaining balance of his Pre-AJCA DIP Account shall be paid in a lump
sum as soon as practicable after June 30 of the calendar year following the
calendar year in which his Pre-AJCA DIP Termination Date occurs.

 

  (c) Form of Payment Following Termination of Employment

 

  (i) Except as otherwise provided in Section B-3(c)(ii), all payments under
this Section B-2 shall be in the form of lump sum, equal to the full balance of
the Pre-AJCA DIP Participant’s nonforfeitable interest in his Pre-AJCA DIP
Account as of June 30 in the Plan Year in which the distribution is made.

 

  (ii) A Pre-AJCA DIP Participant may elect to receive his Pre-AJCA DIP Account
in annual installments over a specified period of up to 20 years; provided that:

 

  (A) If, as of June 30 of the year in which payment is scheduled to commence,
the Pre-AJCA DIP Account balance is $50,000 or less, the Company shall pay such
balance to the Pre-AJCA DIP Participant in a lump sum; and

 

  (B) If the Pre-AJCA DIP Participant’s employment with the Company is
terminated for Gross Misconduct, the Company shall have sole discretion to
determine the form in which his Pre-AJCA DIP Account is paid.

The amount of each annual installment shall be equal to the balance of the
Pre-AJCA DIP Account as of June 30 of the applicable year divided by the number
of annual installments remaining to be paid. A Pre-AJCA DIP Participant may
change his election with respect to form of payment of his Pre-AJCA DIP Account
only to the extent permitted by and subject to such rules and procedures
established by the Administration Committee as in effect on October 3, 2004.

 

 

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  (d) Rehire

 

  (i) If a Pre-AJCA Participant is rehired by the Company before his Pre-AJCA
DIP Distribution commences, his prior termination date shall not be treated as
his Pre-AJCA DIP Termination Date for purposes of this Appendix B.

 

  (ii) If a Pre-AJCA Participant is rehired by the Company after his Pre-AJCA
DIP Termination Distribution commences, payments shall continue in accordance
with the payment schedule in effect, without regard to his rehire.

 

B-4. UNSCHEDULED DISTRIBUTIONS AND PAYMENTS UPON DEATH

 

  (a) A Pre-AJCA DIP Participant shall not be eligible to receive an unscheduled
distribution except to the extent permitted by subsections (b) and (c) of this
Section B-4.

 

  (b) Hardship Distribution

 

  (i) A Pre-AJCA DIP Participant who is actively employed by the Company (after
having been rehired before commencement of his Pre-AJCA DIP Termination
Distribution) and who satisfies the requirements of this Section B-4(b) may
receive an unscheduled distribution from his Pre-AJCA DIP Account in the event
of a Pre-AJCA DIP Unforeseeable Emergency.

 

  (ii) If a Pre-AJCA DIP Participant seeks to receive a distribution pursuant to
this Section B-4(b), he shall present such evidence and certifications as the
Administration Committee or the Plan’s recordkeeper considers necessary to
determine whether the Pre-AJCA DIP Participant meets the requirements of this
Section B-4(b). The amount of any distribution pursuant to this Section B-4(b)
shall not exceed the amount reasonably required to satisfy the emergency need.

 

  (iii) Notwithstanding the forgoing, a distribution shall not be made pursuant
to this Section B-4(b) to the extent that the applicable Pre-AJCA DIP
Unforeseeable Emergency is or may be relieved through—

 

  (A) reimbursement or payment by insurance or otherwise;

 

  (B) a commercial loan or loan under the Qualified Plan;

 

  (C) a hardship distribution under the Qualified Plan;

 

 

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  (D) liquidation of the Pre-AJCA DIP Participant’s assets, to the extent the
liquidation of such assets would not itself cause severe financial hardship; or

 

  (E) cessation of deferrals under the Plan.

 

  (iv) If a Pre-AJCA DIP Participant receives a distribution pursuant to this
Section B-4(b)—

 

  (A) any Deferral Elections previously filed by the Pre-AJCA DIP Participant
with respect to a period after the distribution shall be canceled; and

 

  (B) the Pre-AJCA DIP Participant shall not be permitted to file any further
Deferral Election forms with respect to any Plan Year before the Plan Year that
beings after the Plan Year in which such distribution is made.

 

  (c) Non-Hardship “Haircut” Distribution. A Pre-AJCA DIP Participant who does
not qualify for a Pre-AJCA Hardship Distribution may at any time elect to
receive a distribution of all or any portion of his Pre-AJCA DIP Account;
provided, however, that if a Pre-AJCA DIP Participant receives an unscheduled
distribution pursuant to this Section B-4(c), an amount equal to 10 percent of
the amount requested to be distributed shall be permanently forfeited from the
vested balance in the Participant’s Pre-AJCA DIP Account and shall not be paid
to, or in respect of, the Pre-AJCA DIP Participant at any time.

 

  (d) Form of Payment of Unscheduled Pre-AJCA DIP Distributions. All payments
under subsections (b) and (c), above, shall be made in a lump sum.

 

  (e) Payments Upon Death. Upon the death of a Pre-AJCA DIP Participant (whether
or not he is employed by the Company at the time of death), the Company shall
pay the remaining balance in his Pre-AJCA DIP Account in accordance with the
following rules:

 

  (i) Except as provided in Section B-4(e)(iii), if, at the time of the Pre-AJCA
DIP Participant’s death, he has not begun receiving payments from the Plan,
payments shall be made in accordance with Section B-3(b). If the Participant
dies before his Pre-AJCA DIP Termination Date, the date of his death shall be
treated as his Pre-AJCA DIP Termination Date.

 

  (ii) Except as provided in Section B-4(e)(iii), if a Pre-AJCA DIP Participant
dies while receiving Pre-AJCA DIP Account distributions, his Beneficiary shall
receive any remaining installment payments under this Appendix B as they become
due.

 

  (iii) Subject to any rules, regulations, conditions, and restrictions
established by the Administration Committee and in effect on October 3, 2004,
any Beneficiary may petition the Administration Committee to change the terms of
the Pre-AJCA DIP Participant’s distribution election with respect to his
Pre-AJCA DIP Account or to receive his distribution in a single lump sum.

 

 

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  (f) Designation of Beneficiary. A Pre-AJCA DIP Participant’s Beneficiary shall
be determined in accordance with Section 8.03 of the Plan.

 

 

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APPENDIX C. DISTRIBUTION OF PRE-AJCA EX-CAP ACCOUNTS

 

C-1. APPLICABILITY

This Appendix C applies only for Pre-AJCA Ex-CAP Accounts, as defined in
Section 2.01(dd)(2) of the Plan. This Appendix C sets forth the rules relating
to form and time of payment for Pre-AJCE Ex-CAP Accounts that applied under the
Pre-AJCA Ex-CAP (as defined below).

 

C-2. DEFINITIONS

For purposes of this Appendix C—

 

  (a) “Ex-CAP Change in Control.”

 

  (i) Subject to paragraph (ii), below, an “Ex-CAP Change in Control” shall be
deemed to have occurred if any one of the following events shall have occurred:

 

  (A) A Tender Offer (other than a Tender Offer by MeadWestvaco) expires, if the
offeror acquires Shares pursuant to such Tender Offer;

 

  (B) Shareholders of MeadWestvaco approve a definitive agreement—

 

  (1) for the merger or consolidation of MeadWestvaco or any direct or indirect
subsidiary of MeadWestvaco into or with another corporation, other than—

 

  (a) a merger or consolidation that would result in the voting securities of
MeadWestvaco outstanding immediately prior thereto continuing to represent—

 

  (I) in the case of a merger or consolidation of MeadWestvaco, either by
remaining outstanding or by being converted into voting securities of the
surviving entity of any parent thereof, or

 

  (II) in the case of a merger or consolidation of any direct or indirect
subsidiary of MeadWestvaco, either by remaining outstanding if MeadWestvaco
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 percent of the combined voting power of the voting securities of
MeadWestvaco or such surviving or parent entity outstanding immediately after
such merger or consolidation; or

 

 

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  (b) a merger or consolidation effected to implement a recapitalization of
MeadWestvaco (or similar transaction) in which no Person is or becomes the
Beneficial Owner, directly or indirectly, of securities of MeadWestvaco (not
including in the securities Beneficially Owned by such Person any securities
acquired directly from MeadWestvaco or its CIC Affiliates) representing 25
percent or more of the combined voting power of MeadWestvaco’s then outstanding
securities, or

 

  (2) for the sale or disposition of all or substantially all of the assets of
MeadWestvaco, other than a sale or disposition by MeadWestvaco of all or
substantially all of MeadWestvaco’s assets to an entity, at least 51 percent of
the combined voting power of the voting securities of which are owned (directly
or indirectly) by shareholders of MeadWestvaco in substantially the same
proportions as their ownership of MeadWestvaco immediately prior to such sale or
disposition;

 

  (C) any Person is or becomes the Beneficial Owner of 25 percent or more of the
voting power of the then outstanding securities of MeadWestvaco (not including
in the securities Beneficially Owned by such Person any securities acquired
directly from MeadWestvaco or its CIC Affiliates), excluding (1) any Person who
becomes such a Beneficial owner in connection with a transaction described in
subparagraph (B)(1)(a), above, or (2) the date of authorization, by both a
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, or, if applicable, its closest equivalent
under Delaware law), or

 

  (D) 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 MeadWestvaco) who were elected, or were nominated for
election by MeadWestvaco’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.

 

 

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  (ii) Notwithstanding any provision of paragraph (i), above, an Ex-CAP 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 MeadWestvaco immediately prior to such
transaction or series of transactions continue to have substantially the same
proportionate ownership in an entity that owns all or substantially all of the
assets of MeadWestvaco immediately following such transaction or series of
transactions.

 

  (iii) Certain Definitions. For purposes of this Section C-2(a)—

 

  (A) “Beneficial Owner” shall have the meaning set forth in Rule 13d-3 of the
Exchange Act.

 

  (B) “CIC Affiliate” shall mean “affiliate,” as defined in Rule 12b-2
promulgated under section 12 of the Exchange Act.

 

  (C) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

 

  (D) “Person” shall have the meaning set forth 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:

 

  (1) MeadWestvaco or any of its subsidiaries;

 

  (2) a trustee or other fiduciary holding securities under an employee benefit
plan of MeadWestvaco or any of its CIC Affiliates;

 

  (3) an underwriter temporarily holding securities pursuant to an offering of
such securities, or

 

  (4) a corporation owned, directly or indirectly, by the shareholders of
MeadWestvaco in substantially the same proportions as their ownership of stock
of MeadWestvaco.

 

  (E) “Shares” shall mean shares of common stock of MeadWestvaco Corporation.

 

  (F) “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.

 

  (b) “Ex-CAP Distribution Period” means a period of 5, 10, 15, or 20 calendar
years as elected by the Pre-AJCA Ex-CAP Participant for whom the Account is
maintained.

 

 

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  (c) “Ex-CAP Elective Distribution” means a distribution pursuant to Section
C-3(d).

 

  (d) “Ex-CAP Emergency Distribution” means a distribution pursuant to Section
C-3(c).

 

  (e) “Ex-CAP Payment Date” means July 20 of each year, except that if an
election was filed in accordance with Section 3.3 of the Pre-AJCA Ex-CAP with
respect to distributions following an Ex-CAP Change in Control, the term
includes July 20 of the year selected by a Participant to receive a lump sum
distribution.

 

  (f) “Pre-AJCA Ex-CAP Participant” means a Participant who (i) terminated
employment with the Company and Affiliates before January 1, 2005, and (ii) has
a Pre-AJCA Ex-CAP Account.

 

  (g) “Pre-AJCA Ex-CAP” means the Mead Corporation Executive Capital
Accumulation Plan as in effect on October 3, 2004.

 

  (h) “Ex-CAP Unforeseeable Emergency” means severe financial hardship to the
Pre-AJCA Ex-CAP Participant resulting from a sudden and unexpected illness or
accident of the Pre-AJCA Ex-CAP Participant or of his “dependent” (as defined in
section 152(a) of the Code), loss of the Pre-AJCA Ex-CAP Participant’s property
due to a casualty, or other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of the Pre-AJCA
Ex-CAP Participant.

 

C-3. DISTRIBUTION OF PRE-AJCA EX-CAP ACCOUNTS TO PRE-AJCA EX-CAP PARTICIPANTS

 

  (a) Annual Distributions

Except as otherwise provided in this Appendix C, if a Pre-AJCA Ex-CAP
Participant’s employment with the Company and 80% Affiliates is terminated for
any reason other than his death, and on the June 30 preceding his initial Ex-CAP
Payment Date, the aggregate balances of his Pre-AJCA Ex-CAP Accounts equal at
least $50,000, each of his Pre-AJCA Ex-CAP Accounts shall be distributed to him
in annual installments (each in the amount determined as provided below), made
on or about each Ex-CAP Payment Date, beginning:

 

  (i) in the case of a Pre-AJCA Ex-CAP Participant whose employment terminates
at any age by reason of “disability” (as determined by the Plan Administrator)
or for any reason upon or after reaching age 55 years, on or about the Ex-CAP
Payment Date of the calendar year elected by him; and

 

  (ii) in all other cases, and notwithstanding any previous election, on or
about the Ex-CAP Payment Date of the calendar year next following the calendar
year during which his termination of employment with the MeadWestvaco and its
80% Affiliates occurs;

and continuing for the number of calendar years constituting the Ex-CAP
Distribution Period he has elected with respect to that Pre-AJCA Ex-CAP Account.
Notwithstanding a Pre-AJCA Ex-CAP Participant’s elected Ex-CAP

 

 

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Distribution Period, if on the June 30 preceding his initial Ex-CAP Payment
Date, the aggregate balances of a Pre-AJCA Ex-CAP Participant’s Pre-AJCA Ex-CAP
Accounts is an amount that is less than $50,000, those balances shall be
distributed to him on or about his initial Ex-CAP Payment Date in a single lump
sum. The amount of each annual installment from a Pre-AJCA Ex-CAP Account for a
calendar year shall be equal to the balance of such Pre-AJCA Ex-CAP Account as
of June 30 of the applicable year, divided by the number of calendar years
remaining in the Ex-CAP Distribution Period elected by the Pre-AJCA Ex-CAP
Participant with respect to that Pre-AJCA Ex-CAP Account. Notwithstanding any of
the foregoing to the contrary, if a Pre-AJCA Ex-CAP Participant with respect to
whom a participant account under the Pre-AJCA Ex-CAP was established for
calendar year 1995 or 1996 has elected an Ex-CAP Distribution Period that is
less than 10 calendar years, then, at any time, but at least one year prior to
his initial Ex-CAP Payment Date, he may elect to have his Ex-CAP Distribution
Period with respect to such portion of his Pre-AJCA Ex-CAP Account occur over a
period of 10 or more years commencing on the previously elected initial Ex-CAP
Payment Date.

 

  (b) Interim Distributions

If a Pre-AJCA Ex-CAP Participant becomes entitled to receive an interim
distribution pursuant to section 8.2 of the Pre-AJCA Ex-CAP from a Pre-AJCA
Ex-CAP Account on or after the initial Ex-CAP Payment Date applicable to such
Account, no such interim distribution shall be made to him and the annual
installment payments specified by Section C-3(a) shall continue. Any interim
distribution election made by a Pre-AJCA Ex-CAP Participant pursuant to section
8.2 of the Pre-AJCA Ex-CAP shall be automatically canceled on the date of his
death. Notwithstanding any of the foregoing to the contrary, if a Pre-AJCA
Ex-CAP Participant has elected pursuant to section 8.2 of the Pre-AJCA Ex-CAP to
receive an interim distribution with respect to a participant account
established for calendar years 1995 and 1996, then, at any time, but at least
one year prior to such interim distribution, he may elect to reduce such interim
distribution payment.

 

  (c) Ex-CAP Emergency Distributions

 

  (i) If, on written application of a Pre-AJCA Ex-CAP Participant, it is
determined (as provided below) that such Participant has experienced an Ex-CAP
Unforeseeable Emergency, then, as of the first day of any calendar month, he may
elect to receive an Ex-CAP Emergency Distribution from one or more of his
Pre-AJCA Ex-CAP Accounts, provided that the aggregate amount of any such
distribution shall not exceed the amount reasonably needed to satisfy his
emergency need. In determining whether an Ex-CAP Emergency Distribution should
be made to a Pre-AJCA Ex-CAP Participant consideration may be given to the
extent to which his Ex-CAP Unforeseeable Emergency can be relieved:

 

  (A) through reimbursement or compensation by insurance or otherwise;

 

 

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  (B) by liquidation of the Pre-AJCA Ex-CAP Participant’s assets, to the extent
the liquidation of such assets would not itself cause severe financial hardship;

 

  (C) by cessation of deferrals under the Plan; or

 

  (D) other distributions to be made to the Pre-AJCA Ex-CAP Participant from the
Plan.

 

  (ii) A determination with respect to whether a Pre-AJCA Ex-CAP Participant has
experienced an Ex-CAP Unforeseeable Emergency shall be made:

 

  (A) in the case of a Pre-AJCA Ex-CAP Participant employed or last employed by
the Company at a salary grade below salary grade 24 (exclusive of an elected
officer of the Company or an 80% Affiliate) and his Beneficiary, the Plan
Administrator; and

 

  (B) in the case of a Pre-AJCA Ex-CAP Participant employed or last employed by
the Company at salary grade 24 or above or as an elected officer of the Company
or an 80% Affiliate, and their beneficiaries, the Administration Committee.

 

  (iii) To the extent permitted under ERISA, determinations made pursuant to
this Section C-3(c) shall not be subject to the procedures established pursuant
to Section 9.05 of the Plan.

 

  (d) Ex-CAP Elective Distributions. As of the first day of any calendar month a
Pre-AJCA Ex-CAP Participant may elect, by writing filed with the Plan
Administrator, to receive an Ex-CAP Elective Distribution from one or more of
his Pre-AJCA Ex-CAP Accounts; provided, however, that if a Pre-AJCA Ex-CAP
Participant receives an Ex-CAP Elective Distribution, he shall forfeit an amount
equal to 20 percent of the amount of such Ex-CAP Elective Distribution.

 

  (e) Ex-CAP Change in Control Distributions. In connection with, but prior to,
a, Ex-CAP Change in Control, the Administration Committee, in its sole
discretion, may authorize distribution of Pre-AJCA Ex-CAP Accounts in single
lump sums.

 

C-4. DISTRIBUTION OF PRE-AJCA EX-CAP ACCOUNTS TO BENEFICIARIES

 

  (a) Distribution to a Beneficiary. If a Pre-AJCA Ex-CAP Participant dies
(either prior to or following his Termination of Employment) the undistributed
balance of each of his Pre-AJCA Ex-CAP Accounts will be distributed as follows:

 

  (i) If distribution has commenced prior to his death, annual installments
shall continue to be distributed to his Beneficiary with respect to the Pre-AJCA
Ex-CAP Account during the remainder of the Ex-CAP Distribution Period applicable
to that Pre-AJCA Ex-CAP Account, as if the deceased Pre-AJCA Ex-CAP Participant
had lived; and

 

 

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  (ii) If distribution has not commenced prior to his death, the applicable
Pre-AJCA Ex-CAP Account shall be distributed in annual installments commencing
on the Ex-CAP Payment Date and over the Ex-CAP Distribution Period elected by
the deceased Pre-AJCA Ex-CAP Participant with respect to that Pre-AJCA Ex-CAP
Account.

 

  (b) Beneficiary. A Pre-AJCA Ex-CAP Participant’s Beneficiary shall be
determined in accordance with Section 8.03 of the Plan.

 

C-5. Section 162(m) Limitation on Distributions

Notwithstanding any other provision of this Appendix C to the contrary,
distributions of Pre-AJCA Ex-CAP Accounts shall be subject to the “Section
162(m) Limitation” as in effect on October 3, 2004. This Section C-5 sets forth
the terms of such Section 162(m) Limitation.

 

  (a) Definitions. For purposes of this Section C-5—

 

  (i) “Ex-CAP Accounting Date” means each business day; provided that, with
respect to any Ex-CAP Supplement A Individuals, “Ex-CAP Accounting Date” means
the last business day of each calendar quarter.

 

  (ii) “Ex-CAP Supplement A Individual” means (i) any individual who was a
participant in the Ex-CAP as of December 31, 1999, and (ii) each beneficiary of
a deceased participant in the Ex-CAP who was eligible to receive a distribution
from the Ex-CAP as of January 1, 2000.

 

  (b) Tentative Section 162(m) Determination. Prior to a Pre-AJCA Ex-CAP
Participant’s Ex-CAP Payment Date for any calendar year, the Administration
Committee may, in its discretion, make a tentative determination as to whether
the sum of:

 

  (i) amounts otherwise distributable to the Pre-AJCA Ex-CAP Participant from
his Pre-AJCA Ex-CAP Account under the Plan as of that Ex-CAP Payment Date; and

 

  (ii) all other compensation expected to be payable to the Pre-AJCA Ex-CAP
Participant and deductible by the Company for that calendar year;

will exceed the maximum deductible amount permitted with respect to the Pre-AJCA
Ex-CAP Participant for that calendar year by section 162(m) of the Code. Based
on the Administration Committee’s tentative decision, the provisions of Section
C-5(c) or (d), as the case may be, shall become applicable with respect to the
Pre-AJCA Ex-CAP Participant. Notwithstanding the foregoing, the provisions of
this Section C-5 shall not be applicable with respect to any distribution
payable under this Appendix C during any calendar year following the calendar
year in which an Ex-CAP Change in Control occurs.

 

  (c)

Tentative Determination Amount Not in Excess of 162(m) Limit. If the
Administration Committee tentatively determines that the sum of the amounts
described in Section C-5(b)(i) and (b)(ii) payable to a Pre-AJCA Ex-CAP

 

 

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Participant for a calendar year will be fully deductible by the Company for that
year, distribution from his Pre-AJCA Ex-CAP Accounts shall be made to the
Pre-AJCA Ex-CAP Participant in accordance with the provisions of Section C-3 as
of his Ex-CAP Payment Date.

 

  (d) Tentative Determination Amount in Excess of 162(m) Limit. If the
Administration Committee tentatively determines that the sum of the amounts
described in Section C-5(b)(i) and (b)(ii) payable to a Pre-AJCA Ex-CAP
Participant for a calendar year will not be fully deductible by the Company for
that year, the Administration Committee may direct that all or any portion of
the balances of his Pre-AJCA Ex-CAP Accounts otherwise distributable as of his
Ex-CAP Payment Date for that calendar year be retained under the terms of the
Plan, as modified by this Appendix C. However, during the month of December of
that calendar year, the Administration Committee shall make a final
determination with respect to whether any portion of such retained amount will
be fully deductible to the Company for that calendar year if distributed to the
Pre-AJCA Ex-CAP Participant and such portion that is fully deductible, if any,
shall be distributed to the Pre-AJCA Ex-CAP Participant on or before that last
day of that calendar year. Any such distribution shall be charged to the
Participant’s Pre-AJCA Ex-CAP Account from which it was distributed as of the
Ex-CAP Accounting Date coincident with or next following the date of
distribution.

 

 

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