Exhibit 10.1
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Rewards for your Contributions to Our Success Key Management Annual Incentive
Plan • Fiscal Year 2012

 

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Creativity...Innovation... Collaboration... Our commitment to these ideals has
allowed us to become one of the world’s largest publicly owned developers,
producers and distributors of social expressions products. As a leader at
American Greetings, you have a unique opportunity to focus our associates on
these key areas and to cultivate a work environment that is stimulating,
productive and rewarding. In addition, the decisions you make and the things you
do every day have a direct and meaningful impact both within your department and
across the company. We have designed the Key Management Annual Incentive Plan to
reward you for the critical role you play. As a leader, you help foster and
channel your energy and the energy of those around you into building on our
business principles, strengthening our marketplace position and generating value
for our shareholders. Table of Contents Plan Objectives and Who is Eligible. . .
. . . . . . . . . . . . . . . . . . . 2 How the Plan Works. . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Emphasis of Each Plan
Component. . . . . . . . . . . . . . . . . . . . . 4 Measuring Performance. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Corporate
Component. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Business Unit Component. . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Individual Component. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . 9 Example Calculation. . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . 10 Important Administrative Plan Details. . . . . . . . . . .
. . . . . . . . 12 Key Terms. . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . 13 Appendix. . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 1

 

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Plan Objectives • Focuses on shareholder value and profitable revenue growth |
Our shareholders expect us to evaluate our results in the same way they do •
Emphasizes teamwork and mutual cooperation | Our success depends on the
collaborative effort within each of our business units • Demonstrates the
importance of personal drive and commitment to quality | Individual
contributions are the foundation of our collective accomplishments • Rewards
leaders for success | Award opportunity is greatest when attention is given to
the achievement of objectives in each of the three performance areas Watch for
Your Participant Letter You will receive a Participant Letter that outlines
information specific to your participation in the Plan: • Your assigned business
unit and sub-business unit, if any • The performance multiplier for your
business unit and sub-business unit • Your total target award Who Is Eligible
You are eligible to participate in the Plan if you are a Key Manager or
Corporate-level Officer in one of the following primary business units: •
Corporate Consolidated • Total Social Expressions Group (SEG) • AG Intellectual
Properties Group • AG Interactive • AG Properties • UK Greetings • John Sands
Group Refer to the sections entitled Important Administrative Plan Details and
Key Terms for additional details on eligibility for participation in the Plan. 2

 

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How the Plan Works The Plan provides a cash award for the achievement of goals
in three key performance areas measured over a 12-month fiscal year. Success in
these key areas helps American Greetings create shareholder value and ensure
profitable growth over the long term. Your Award Opportunity Your total target
award is established at the beginning of each fiscal year and will be
communicated to you at that time. Your total target award is: • A percentage of
your base earnings based on your job level • The award you would earn if each
goal is achieved in each performance area The amount of the award you receive
will increase or decrease based on actual performance in these three key areas:
American Greetings will establish goals at the beginning of each fiscal year: •
Corporate goals are developed by management and approved by the Board of
Directors. • Business unit goals are developed by each business unit based on
its strategic direction, business opportunities and growth projections. These
goals, as they apply to our Section 16 officers, are approved by the Board of
Directors. • Individual performance goals are established with your manager
through the Performance Management Process. At the end of the fiscal year,
American Greetings determines the extent to which each goal has been met.
Corporate Performance Business Unit Performance Individual Performance 3 E X A M
P L E If base earnings are $70,000 and target award percentage is 10% of base
earnings, total target award is $7,000. Base Earnings ($70,000) x Target Award %
(10%) = Target Award ($7,000)

 

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Emphasis of Each Plan Component For all plan participants, the business unit
component is 50% of your total target award. The weights for the corporate and
individual components vary based on the potential the job role has to affect
these results. The more senior the role, the greater the impact these
individuals’ decisions have on the achievement of corporate objectives.
Therefore, senior job levels have a heavier weighting on the corporate component
and less senior job levels have a heavier weighting assigned to the individual
component. F I S C A L Y E A R 2 0 1 0 WE I G H T I N G S Job Level Corporate
Business Unit Individual Chairman of the Board CEO President and COO
Corporate-level Senior Vice Presidents Other Section 16 Executive Officers 30%
50% 20% Corporate-level Vice Presidents Executive Directors Key Managers 1 and 2
20% 50% 30% E X A M P L E Ben: • Key Manager 1, Total Social Expressions Group
(SEG) • $70,000 base earnings • $7,000 total target award (10% of base earnings)
$2,100 = Individual ($7,000 x 30%) $1,400 = Corporate ($7,000 x 20%) $3,500 =
Business Unit ($7,000 x 50%) 4

 

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Measuring Performance When American Greetings results for the fiscal year are
final, the company assesses achievement of goals in each performance area.
Performance in each area will determine your actual Plan award. Awards for the
corporate and business unit components are based on the financial performance
award scale. Individual awards are based on your performance rating. Individual
Performance Total Award Corporate Performance Business Unit Performance + + =
Financial Performance Award Scale Your actual award is based on fiscal year-end
performance results using the award scale shown at left for corporate and
business unit financial measures. (See Measuring Performance table on page 6 for
details.) To earn an award, performance in each area must at least reach
threshold. There is no award for below-threshold performance. Achieving goal
means American Greetings pays awards at target levels. Performance above goal
will result in an increased award up to a maximum level. The award range for
American Greetings financial measures is 0% — 200% of target award. Actual Award
200% of Target 100% of Target THRESHOLD X% of Target* 0% of Target (No Award
Below Threshold) Performance Above Goal Goal Below Goal Below Threshold G O A L
MAXIMUM Performance Multiplier — How It’s Used in the Award Scale Performance
multipliers are another way to think about the award scale. There is a
relationship between performance and your actual award. For example, there is a
4:1 multiplier for the Corporate EPS measure. This means that for every 1%
increase or decrease in the percentage of goal achieved, the Corporate EPS
target award will be adjusted up or down by 4% to determine the actual award.
Performance multipliers vary (see the Appendix on page 14 for complete list). 5

 

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Corporate Component The corporate component consists of two parts: • Corporate
Earnings per Share (EPS) • Corporate Total Revenue (Total Revenue) Each of these
parts is weighted. The Plan is designed to emphasize the importance of our
leaders’ abilities to influence EPS, while paying attention to how they can
affect Total Revenue. The weighting applied to the total target award for the
corporate component is: • 90% for EPS • 10% for Total Revenue The potential
award under the corporate component ranges from 0% to 200% of target award.
Performance has a direct impact on actual award. For every 1% increase or
decrease in the percentage of goal achieved: • EPS target award will be adjusted
up or down by 4% to determine the actual award for this part of the corporate
component. • Total Revenue target award will be adjusted up or down by 5% to
determine the actual award (Total Revenue goal is defined as a range between 97%
and 103% of goal). You can earn up to 200% of the total target award for the
corporate component based on EPS performance, Total Revenue performance or a
combination of the two. Performance Measures METRIC WHY IT’S IMPORTANT Corporate
Earnings per Share (EPS) EPS shows how much profit was generated on a per share
basis. It communicates to the investment community the power the company has to
make money. The higher our EPS, the greater value the company is able to provide
its shareholders. Corporate Total Revenue (Total Revenue) When investing in a
company, an investor wants to see it grow or improve over time. Management sets
a Corporate Total Revenue goal each year to keep activities focused on growing
the business year-over-year. Earnings Before Interest and Taxes (EBIT) EBIT is
also known as operating income. It measures the business unit’s earnings before
the deduction of interest payments and taxes. Refer to the section entitled Key
Terms for definitions for these financial measures. Total Revenue Goal Is a
Range The Total Revenue portion of the corporate component has a goal defined as
a range. That’s because American Greetings believes we have met our Total
Revenue objective if we perform between 97% and 103% of goal. 6

 

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Corporate Component C O R P O R A T E E P S Award Scale (4:1) Performance as %
of Goal Actual Award as a % of Target Actual Award in Dollars Maximum 127.5%
200% $2,800 120% 170% $2,380 110% 130% $1,820 Goal 100% 90% $1,260 95% 70% $980
Threshold 90% 50% $700 H O W I T ’ S C A L C U L A T E D The formula to
calculate your actual award as a percent of target is: (Actual Performance –
Goal) x 4 + 90% = Actual Award as a % of Target Award Performance Above Goal:
(105% — 100%) x 4 + 90% = 110% of Target Award Performance Below Goal: (95% —
100%) x 4 + 90% = 70% of Target Award C O R P O R A T E T O T A L R E V E N U E
Award Scale (5:1) Performance as % of Goal Actual Award as a % of Target Actual
Award in Dollars Maximum 141% 200% $2,800 125% 120% $1,680 105% 20% $280 Goal
97% – 103% 10% $140 96% 5% $70 Threshold 95% 0% $0 H O W I T ’ S C A L C U L A T
E D The formula to calculate your actual award as a percent of target is:
(Actual Performance – Goal) x 5 + 10% = Actual Award as a % of Target Award
Performance Above Goal: (105% — 103%) x 5 + 10% = 20% of Target Award
Performance Below Goal: (96% — 97%) x 5 + 10% = 5% of Target Award B E N ’ S A C
T U A L AWA R D F O R C O R P O R AT E C OMP O N E N T • EPS Actual Performance:
95% of goal = actual award of 70% of target ($980) • Total Revenue Actual
Performance: 125% of goal = actual award of 120% of target ($1,680) E X A M P L
E Ben, Key Manager 1 $7,000 total target award • $1,400 corporate component (20%
of total target award) • $1,260 Corporate EPS (90% of total corporate component)
• $140 Corporate Total Revenue (10% of total corporate component) Corporate
Performance Threshold Each part of the corporate component has its own
performance threshold: • EPS: 90% of goal • Total Revenue: 95% of goal The
performance threshold must be met to earn an actual award for that measure.
Total Award: $980 + $1,680 = $2,660 7

 

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Business Unit Component The award for your primary business unit component will
be based on performance in either: • Business Unit Pro Forma EBIT • Product Line
Contribution (PLC) or • Corporate EBIT All associates are assigned to a primary
business unit. Some will also be assigned to a sub-business unit, which may have
different performance measures. Refer to your personalized Participant Letter
for your assigned business unit and sub-business unit, if applicable, and
performance multiplier. See the Appendix on page 14 for more details. Business
Unit Performance Threshold • All primary and sub-business units have a
performance threshold of 90% of goal. Award: $3,220 E X A M P L E Ben, Key
Manager 1 $7,000 total target award • $3,500 business unit component (50% of
total target award) T O T A L S E G Award Scale (4:1) Performance as % of Goal
Actual Award as a % of Target Actual Award in Dollars Maximum 125% 200% $7,000
120% 180% $6,300 115% 160% $5,600 110% 140% $4,900 105% 120% $4,200 Goal 100%
100% $3,500 98% 92% $3,220 95% 80% $2,800 Threshold 90% 60% $2,100 H O W I T ’ S
C A L C U L A T E D The formula to calculate your actual award as a percent of
target is: (Actual Performance – Goal) x 4 + 100% = Actual Award as a % of
Target Award Performance Above Goal: (110% — 100%) x 4 + 100% = 140% of Target
Award Performance Below Goal: (98% — 100%) x 4 + 100% = 92% of Target Award B
EN’ S ACTUA L AWA R D FOR BUS INE S S UNI T COMPONENT Total SEG Actual
Performance: 98% of goal = actual award of 92% of target ($3,220) 8

 

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Individual Component Your award under the individual component is based on your
performance rating under the performance management process. Based on your
performance rating, you will receive 0% to 200% of your target award, as shown
in the chart below. Performance Rating Actual Award as a % of Target Exceeds
Expectations (Manager Discretion) 200% Exceeds Expectations 150% Meets
Expectations 100% Improvement Expected/Performance Below Peer Level 0%
Participants who receive an “Improvement Expected/Performance Below Peer Level”
rating will not receive an individual performance incentive and will only
receive 50% of any incentive otherwise earned under the corporate and business
unit components. If Corporate EPS performance is below threshold, associates
with a performance rating of “Exceeds Expectations” will receive an award for
the individual performance component as shown in the chart above. Individuals
with a “Meets Expectations” or “Improvement Expected/Below Peer Level”
performance rating will not receive any portion of the individual performance
incentive if Corporate EPS performance is below threshold. E X A M P L E Ben,
Key Manager 1 $7,000 total target award • $2,100 individual component (30% of
total target award) • Individual Actual Performance: Exceeds Expectations
Individual Target Award $ 2,100 x Actual Award as a % of Target x 150%
Individual Performance Actual Award $ 3 , 1 5 0 Senior Executive Officers Refer
to the fiscal year 2012 Addendum to the Individual Performance Component,
included with your Award Letter, for a complete description of how individual
performance under the Key Management Annual Incentive Plan applies to you. 9

 

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Example Calculation Here is an example of how your actual award is determined.
$2,100 = Individual Target ($7,000 x 30%) Individual Performance Individual
Performance Rating $1,400 = Corporate Target ($7,000 x 20%) • $1,260 EPS • $140
Total Revenue Corporate Goal • $1.25 Corporate EPS • $1.7 Billion Corporate
Total Revenue $3,500 = Business Unit Target ($7,000 x 50%) Business Unit Goal
$140 Million Total SEG E X A M P L E Ben, Key Manager 1 Total Social Expressions
Group (SEG) Base Earnings: $70,000 Total Target Award: $7,000 (10% of base
earnings) A C T U A L P E R F O R M A N C E The chart below outlines the
performance goals and actual performance in the three categories — American
Greetings corporate and business unit and Ben’s individual performance.
Performance Performance and Award Results Component and Measure Goal Actual
Performance Performance as a % of Goal Award as a % of Target Corporate
Component Corporate EPS $1.25 per share $1.19 per share 95% 70% Corporate Total
Revenue $1.7 Billion $2.1 Billion 125% * 120% Business Unit Total Revenue Total
SEG Pro Forma EBIT $140 Million $137.2 Million 98% 92% Individual Component
Individual Performance Rating Meets Expectations Exceeds Expectations N/A 150% *
Goal is a range from 97% — 103% of target. To illustrate how awards are
calculated, examples of performance goals are provided in this brochure.
Performance is included in the examples to calculate example awards. These are
examples only; performance goals will be different and may be higher or lower
than the examples provided. 10

 

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Ben’s Total Award Example: Here’s a look at Ben’s total award based on the
performance shown on the previous page. Total Target Award $7,000 Total Actual
Award $9,030 0 2,000 4,000 6,000 8,000 $10,000 $3,500 $2,100 $3,150 $3,220
$2,660 $1,400 C O R P O R AT E C O M P O N E N T Target Award x Award as % of
Target = Actual Award Corporate EPS $1,400 x 70% = $980 Corporate Total Revenue
$1,400 x 120% = $1,680 Total = $2,660 B U S I N E S S U N I T C O M P O N E N T
Target Award x Award as % of Target = Actual Award $3,500 x 92% = $3,220 I N D I
V I D U A L C O M P O N E N T Target Award x Award as % of Target = Actual Award
$2,100 x 150% = $3,150 11

 

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New Hires If you are hired during the Plan year — defined as the American
Greetings fiscal year ending February 29, 2012 — and are eligible to participate
in the Key Management Annual Incentive Plan, you will receive a prorated
incentive award based on the period of time you participated in the Plan and
your base earnings during that time. Promotions and Transfers If you are
promoted or you move from one business unit to another during the Plan year,
your individual target award, base earnings, business unit goal and
corresponding performance multiplier may change. If any of these do change, your
award will be calculated based on the targets, base earnings, plan provisions
and actual performance for each business unit you participated in on a prorated
basis and rounded to the nearest full month. Termination If you voluntarily or
involuntarily leave American Greetings before the completion of the Plan year,
you will forfeit your Key Management Annual Incentive Plan award for that fiscal
year. Retirement, Leave of Absence, Disability, Death If your employment ends
during the Plan year because you elect to retire after age 60, or if you take a
leave of absence, suffer a permanent disability or die, your actual award will
be prorated to the nearest full month based on the actual period you
participated in the Plan during the year. An associate will be deemed to suffer
a permanent disability only in the following circumstances: (A) where an
associate is absent from employment with American Greetings due to his or her
inability to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment, which either can be
expected to result in death, or can be expected to last for a continuous period
of not less than 12 months; or (B) where an associate is scheduled to receive
income replacement benefits for a period of not less than 3 months under an
accident and health plan covering American Greetings associate on account of a
medically determinable physical or mental impairment that can be expected to
result in death or last for a continuous period of not less than 12 months.
Omnibus Incentive Plan The Key Management Annual Incentive Plan is governed by
the American Greetings Corporation 2007 Omnibus Incentive Compensation Plan, as
such plan may be amended from time to time. In the event of a conflict between
the Key Management Annual Incentive Plan and the Omnibus Incentive Compensation
Plan, the terms of the Omnibus Incentive Compensation Plan will govern.
Questions If you have questions about the Key Management Annual Incentive Plan
and how it works, please contact your manager. Your manager will work with you
to ensure you understand the Plan so you can maximize your annual award.
Incentive Award Incentive awards earned in fiscal year 2012 will be paid to
participants within two and one-half months following the end of fiscal 2012,
typically within 60 days after the end of the fiscal year. Plan awards are
subject to normal tax withholding at a standardized rate and will be deposited
to a bank account of your choice. It is the intent that incentive awards fall
under the short-term deferral rules of Section 409A of the Internal Revenue Code
to exempt the payment of such Key Management Annual Incentive Plan benefits from
the requirements of Section 409A. Calculating Payouts For computation purposes,
financial goals and actual performance results are rounded to the nearest
$1,000. The percent of the financial goal achieved and the percent of target
award earned is rounded to the nearest one-tenth of one percent. The actual
incentive award is rounded to the nearest dollar. Important Administrative Plan
Details If your employment status changes, your Plan participation and any
payouts may be affected as described below: 12

 

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• Base Earnings. Your base earnings are defined as your base salary earned
during the fiscal year. Base earnings exclude health and welfare benefits,
bonus, commission, and incentive payments, overtime and other direct or indirect
compensation. Base earnings for Plan participants outside of the U.S. may be
defined differently and may vary by country. • Business Unit EBIT. A business
unit’s earnings before interest and taxes. • Business Unit Pro Forma EBIT. A
business unit’s earnings before interest and taxes, charged/credited for any
variation from plan in Net Capital Employed at the weighted average cost of
capital. • Corporate Earnings Per Share (EPS). Corporate earnings per share is
measured at the end of the fiscal year and is calculated as corporate net income
divided by the total number of planned shares outstanding as calculated on a
fully diluted basis. Primary Business Unit Participants Corporate Consolidated
Chairman, Chief Executive Officer, President and Chief Operating Officer,
Corporate-level Senior Vice Presidents and other Section 16 Executive Officers
Total Social Expressions Group (SEG) Associates who are part of: • AGI In-Store
• Canada • Corporate Staff (Delta, Finance, HR, ISD, Legal) • Creative •
Creative Products • Field Sales • Field Sales Operations (FSO) • Global Sourcing
• Greeting Cards • Inbound Licensing • Plants • Papyrus-Recycled Greetings • All
other North American Greeting Card Division units AG Intellectual Properties
Group AGIP Corporate Staff AG Interactive AG Interactive associates AG
Properties AG Properties associates UK Greetings UK Greetings associates John
Sands Group John Sands Group associates Key Terms The following provides
definitions of some common terms used throughout this brochure. Capitalized
terms used herein that are not defined will have the meaning set forth in the
Omnibus Incentive Compensation Plan. • Corporate Earnings Before Interest and
Taxes (Corporate EBIT). Consolidated corporate earnings before interest and
taxes, charged/credited for any variation from plan in Net Capital Employed at
the weighted average cost of capital. • Corporate Total Revenue. Consolidated
corporate net sales and other revenues, including but not limited to royalties,
advertising, subscriptions and other revenue streams directly related to the
conduct of our principal business. • Eligibility. You are eligible to
participate in the Key Management Annual Incentive Plan if you are a Key Manager
or Corporatelevel Officer in one of the following primary business units and you
do not participate in another Company-sponsored annual incentive plan. • Fiscal
Year. March 1 through February 28 or 29 of the following calendar year. • Net
Capital Employed (NCE). Assets (minus cash and LIFO reserve) minus liabilities
(not including interest-bearing debt, intercompany payables and income taxes). •
PLC Definition. Product Line Contribution equals gross sales less all of the
following: allowances for obsolete cards (AOC); cost of markdowns and
unsaleables; retail allowances; off-invoice discounts; cost of goods sold at
standard cost; assortment labor; cost of caption locator cards, displayer and
point-ofpurchase materials; cost of SBT scrap and shrink; and the cost of
finished goods scrap. • Total Social Expressions Group (SEG). Equals NAGCD pro
forma EBIT (includes Corporate Expense) + AGI In-Store pro forma EBIT. 13

 

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Business Unit/Participants Business Unit Components Performance Measure Weight
Performance Multipliers1 Primary Unit Sub Unit Primary Unit Sub Unit Primary
Unit Sub Unit Corporate Consolidated: Chairman, CEO, President and COO,
Corporate-level Senior Vice Presidents and other Section 16 Executive Officers
Corporate EBIT 100% 4 Canada, Corporate Staff (Delta, Finance, HR, ISD, Legal),
Creative, Creative Products, Field Sales, FSO, Global Sourcing, Greeting Cards,
Plants, all other North American Greeting Card Division units Total SEG 100% 4
Inbound Licensing Total SEG AG Interactive pro forma EBIT 50% 50% 4 2 AGI
In-Store Total SEG AGI In-Store pro forma EBIT 50% 50% 4 2 Papyrus-Recycled
Greetings Total SEG PRG PLC 40% 60% 4 2 AG Intellectual Properties Group –
Corporate Staff AG Interactive pro forma EBIT + AG Properties pro forma EBIT
100% 2 AG Interactive AG Interactive pro forma EBIT 100% 2 AG Properties AG
Properties pro forma EBIT 100% 2 UK Greetings UK Greetings pro forma EBIT 100% 4
John Sands Group John Sands Group pro forma EBIT 100% 2 Appendix The following
section provides additional details about the Plan, including details about the
business units, their performance measures and performance multipliers used in
the award scales. Please note that some plan participants will have their
business unit incentive determined based on performance in two areas. Details
about the weightings and performance multipliers for these measures are shown at
right and on your personalized Participant Letters, as appropriate 1 For every
1% increase or decrease in the percentage of goal achieved, target award will be
adjusted up or down by 1% times the multiplier to determine actual award 14

 

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American Greetings reserves the right to terminate or make changes to the
Program, including retroactively, at any time without prior notice to any of the
Program’s participants (provided that no amendment to the Program adopted more
than 90 days after the beginning of the applicable fiscal year may have the
effect of increasing the amount that is or could be payable under the guidelines
set forth herein for such fiscal year to any participant who is a “covered
employee” of American Greetings as defined in section 162(m)(3) of the Internal
Revenue Code). In the case of our executive officers, the Board of Directors (or
committee thereof), and in the case of all other participants, the Board of
Directors (or committee thereof), the Chief Executive Officer and the Chairman
are the only persons who have the authority to alter or amend this Program. Any
such alteration or amendment must be done in writing. No participant should rely
on an alteration or amendment to this Program unless it is made in writing and
signed by the Chief Executive Officer or the Chairman. Any award earned under
this Key Management Annual Incentive Plan shall be subject to rescission,
cancellation or recoupment, in whole or part, if and to the extent so provided
under any “clawback” or similar policy of American Greetings in effect on the
date of payment or that may be established thereafter, including, without
limitation, any “clawback” or recoupment policy of American Greetings as may be
adopted by American Greetings from time to time as required by Section 304 of
the Sarbanes-Oxley Act of 2002, Section 954 of the Dodd-Frank Wall Street Reform
and Consumer Protection Act, or as otherwise required by applicable law. Nothing
in this brochure or in any Participant Letter or addendum should be construed to
create or imply any contract of employment between an associate and American
Greetings and its subsidiaries or to create any binding contractual right to
payment of any specific amount under the American Greetings Key Management
Annual Incentive Plan. The provisions of this brochure describe the general
guidelines used by American Greetings in determining the benefits payable to
Plan participants; however, in every case, American Greetings reserves the right
to reduce or eliminate the amount that would otherwise be payable to a
participant or participants under such guidelines where it determines, in its
discretion, that such a reduction is necessary or appropriate, in light of the
participant’s performance or other relevant business circumstances. 15

 

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Notes 16

 

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Notes 17

 

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SENIOR EXECUTIVE OFFICER
ADDENDUM TO INDIVIDUAL PERFORMANCE COMPONENT OF
FY2012 AMERICAN GREETINGS KEY MANAGEMENT ANNUAL INCENTIVE PLAN
INDIVIDUAL PERFORMANCE
Notwithstanding the description of the Individual Performance component included
in the booklet (the “Plan Booklet”) outlining the Fiscal 2012 Key Management
Annual Incentive Plan, the Individual Performance component of American
Greetings Key Management Annual Incentive Plan for all Senior Executive Officers
of American Greetings, consisting of the Corporation’s Chairman, Chief Executive
Officer, President and Chief Operating Officer, Senior Vice Presidents and other
Section 16 officers (collectively the “Senior Executive Officers”) is modified
by this Addendum as follows:

•   Specific award percentages for the individual performance component are
replaced with award ranges, thereby giving managers more discretion to adjust
the percentage of the individual award based on an individual’s performance.   •
  Senior Executive Officers who receive an “Exceeds Expectations (Manager
Discretion)” performance rating will earn between 150% and 200% of their target
award under the individual performance component. Those who receive an “Exceeds
Expectations” performance rating will earn between 100% and 150% of their target
award under the individual performance component. And those who receive a “Meets
Expectations” performance rating will earn between 50% and 100% of their target
award under the individual performance component.

As with all participants of the Key Management Annual Incentive Plan, at the end
of the fiscal year, managers assess each Senior Executive Officer’s performance
compared to other participants. Managers determine the degree to which
participants achieved the performance objectives that had been defined at the
beginning of the year.
Managers rank participants based on their relative performance and determine
actual performance ratings and individual performance awards based on these
rankings and the targeted distribution of performance ratings.

•   For Senior Executive Officers, the targeted distribution of participants for
the “Exceeds Expectations (Manager Discretion)” performance rating is 0% to 10%;
the targeted distribution for the “Exceeds Expectation” performance rating is
20% to 30%; the targeted distribution for the “Meets Expectations” performance
rating is 60%; and the targeted distribution for the “Improvement Expected /
Performance Below Peer Level” is 10%. (See chart on the following page.)   •  
Senior Executive Officers who receive an “Exceeds Expectations (Manager
Discretion)” performance rating will receive between 150% and 200% of their

 

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FY2012 KEY MANAGEMENT ANNUAL INCENTIVE PLAN SENIOR EXECUTIVE OFFICER ADDENDUM

    target individual award, as determined by his or her manager.   •   Senior
Executive Officers who receive an “Exceeds Expectations” performance rating will
receive between 100% and 150% of their target individual award, as determined by
his or her manager.   •   Senior Executive Officers who receive a “Meets
Expectations” rating will receive between 50% and 100% of their target
individual award, as determined by his or her manager.   •   As with other
participants, Senior Executive Officers who receive an “Improvement Expected /
Performance Below Peer Level” rating will not receive an individual performance
award and will only receive 50% of any award otherwise earned under the
corporate and business unit components.

As with other participants, if corporate EPS performance is below the
performance threshold, only those Senior Executive Officers with a performance
rating of “Exceeds Expectations” or “Exceeds Expectations (Manager Discretion)”
may receive awards for the individual performance measure.

•   Participants, including Senior Executive Officers, who receive an “Exceeds
Expectations” or “Exceeds Expectations (Manager Discretion)” performance rating
will receive an award for the individual performance component as shown in the
table below.   •   Senior Executives who receive a “Meets Expectations” or
“Improvement Expected / Below Peer Level” performance rating will not receive
any portion of the individual performance award.

The schedule below shows how individual awards will be adjusted based on
individual performance.
Except as set forth in this Addendum, the description of the Key Management
Annual Incentive Plan included in the Plan Booklet remains unchanged. In the
event of a conflict between the terms described in the Plan Booklet and this
Addendum, the terms set forth in this Addendum will govern.

              Target Performance   Actual Award Performance Rating   Rating
Distribution   as a % of Target
Exceeds Expectations (Manager Discretion)
  0 - 10%   150% - 200%
Exceeds Expectations
  20% - 30%   100% - 150%
Meets Expectations
  60%   50% - 100%
Improvement Expected / Performance Below Peer Level
  10%   0%