Exhibit 10.31

 

MeadWestvaco Corporation

 

Description of Executive Officer Compensation

 

For 2005

 

Annual Cash Compensation

 

Base Salary- Set forth below are the 2005 base salaries of the Chief Executive
Officer and each of the four most highly compensated executive officers (the
named executive officers).

 

John A. Luke, Jr.

   $ 985,000

James A. Buzzard

   $ 654,000

E. Mark Rajkowski

   $ 550,008

Wendell L. Willkie, II

   $ 441,000

Mark T. Watkins

   $ 433,850

 

Annual Incentive Compensation- The named executive officers are eligible for
annual performance-based awards under the company’s Annual and Long-Term
Incentive Plan (the “Incentive Plan”). For 2005, goals will be weighted as
follows:

 

1. Financial

      

A. Earnings Before Interest and Taxes (EBIT)

   60 %

B. Working Capital as a percent of sales

   35 %

2. Safety (measured by total case incident rate)

   5 %

 

The minimum payout under the Annual portion of the Incentive Plan for the 2005
calendar year is determined by plan formula and could be 0% of the participant’s
target payout. The maximum award possible under the Annual portion of the
Incentive Plan is 200% of the participant’s target payout. The individual annual
target amount for each of our senior executive officers ranges from 55-110% of
salary, which amount is payable in a lump sum.

 

Long-Term Incentive Compensation- The named executive officers also are eligible
for long-term performance awards under the Incentive Plan and the company’s
Restricted Stock Plan. Under the Long-Term portion of the Incentive Plan and the
Restricted Stock Plan, the Committee established a three year performance period
beginning January 1, 2005 and ending December 31, 2007 (the “Performance
Period”), with the following performance objectives and assigned the weightings
set forth below.

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1. Return on Invested Capital (ROIC)

   40 %

2. Key Performance Objectives

      

Reduction in Selling, General and Administrative Expenses as a percent of sales

   20 %

Total procurement savings (net of inflation)

   20 %

Revenue from New Products (with increased product margins)

   20 %

 

This Long-Term Award, including restricted stock, is subject to (i) a three-year
vesting restriction expiring on the third anniversary of the grant date
(February 22, 2005) and (ii) the satisfaction of the performance objectives
during the Performance Period. The minimum long-term payout under the plans is
zero. If threshold criteria are achieved, payment can be 50% of the
participant’s target. The maximum long-term award possible under the plans is
150% of the participant’s target payout. The total potential Long-Term Award
would be payable one-third in cash (under the Long-Term portion of the Incentive
Plan) and two-thirds in restricted stock. The individual aggregate long-term
target amounts for our named executive officers range from 150-450% of salary.
Long-Term Awards (including cash and stock portions) are subject to Committee
review and exercise of negative discretion. Long-Term Awards would be payable in
2008.