Exhibit 10.11

DOMTAR CORPORATION

       ANNUAL INCENTIVE PLAN FOR MEMBERS OF THE MANAGEMENT COMMITTEE

SECTION 1. PURPOSE

The purposes of the Plan are to enable the Company and its Subsidiaries to
attract, retain, motivate and reward the best qualified executive officers by
providing them with the opportunity to earn competitive compensation directly
linked to the Company’s performance.

SECTION 2. DEFINITIONS

Unless the context requires otherwise; the following words as used in the Plan
shall have the meanings ascribed to each below, it being understood that
masculine, feminine and neuter pronouns are used interchangeably and that each
comprehends the others.

(a) “Act” means the Securities and Exchange Act of 1934, as amended.

(b) “Board” means the Board of Directors of the Company.

(c) “Change in Control” shall have the meaning set forth in the Omnibus Plan..

(d) “Committee” means the Human Resources and Compensation Committee of the
Board or such other committee of the Board as the Board shall designate from
time to time, consisting of two or more members, each of whom is an
“independent” director under New York Stock Exchange Listing requirements, a
“Non-Employee Director” within the meaning of Rule 16b-3, as promulgated under
the Act, and an “outside director” within the meaning of Section 162(m) of the
Internal Revenue Code of 1986, as amended.

 

(e)“Company” means Domtar Corporation.

 

(f)“Covered Employee” shall have the meaning set forth in Section 162(m).

(g) “Executive Officer” means a member of the Company’s Management Committee, as
appointed from time to time by the Board of Directors upon recommendation of the
Committee after consultation with the President and Chief Executive Officer.

 

(h)“Omnibus Plan” means the Amended and Restated Domtar Corporation 2007 Omnibus
Incentive Plan.

(i) “Participant” means each Executive Officer of the Company and Covered
Employee, as well as any former member of the Management Committee who retained
Management Committee-level benefits and is still employed by the Company.

(j) “Performance Period” means each fiscal year or another period as designated
by the Committee, so long as such period does not exceed one year.

(k) “Plan” means this Domtar Corporation Annual Incentive Plan, as set forth
herein and as may hereafter be amended from time to time.

(l) “Section 162(m)” means Section 162(m) of the Internal Revenue Code of 1986,
as amended, and the rules and regulations promulgated thereunder.

 

 

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(m) “Subsidiary” means any business entity in which the Company owns, directly
or indirectly, fifty percent (50%) or more of the total combined voting power of
all classes of stock entitled to vote, and any other business organization,
regardless of form, in which the Company possesses, directly or indirectly, 50%
or more of the total combined equity interests.

SECTION 3. ADMINISTRATION

The Committee shall administer and interpret the Plan, provided that, in no
event, shall the Plan be interpreted in a manner which would cause any award
intended to be qualified as performance based compensation under Section 162(m)
to fail to so qualify. The Committee shall establish the performance objectives
for any fiscal year or other Performance Period determined by the Committee in
accordance with Section 4 and certify whether such performance objectives have
been obtained. Any determination made by the Committee under the Plan shall be
final and conclusive. The Committee may employ such legal counsel, consultants
and agents (including counsel or agents who are employees of the Company or a
Subsidiary) as it may deem desirable for the administration of the Plan and may
rely upon any opinion received from any such counsel or consultant or agent and
any computation received from such consultant or agent. All expenses incurred in
the administration of the Plan, including, without limitation, for the
engagement of any counsel, consultant or agent, shall be paid by the Company. No
member or former member of the Board or the Committee shall be liable for any
act, omission, interpretation, construction or determination made in connection
with the Plan other than as a result of such individual’s willful misconduct.

SECTION 4. BONUSES

(a) Performance Criteria. Within 90 days after each Performance Period begins
(or such other date as may be required or permitted under Section 162(m)) but
not later than the date on which 25% of the performance period has lapsed, the
Committee shall establish the performance objective or objectives that must be
satisfied in order for a Participant to receive a bonus award for such
Performance Period. Unless the Committee determines at the time of grant not to
qualify the award as performance-based compensation under Section 162(m), any
such performance objectives will be based upon the relative or comparative
achievement of one or more of the following criteria, whether in absolute terms
or relative to the performance of one or more similarly situated companies or a
published index covering the performance of a number of companies, as determined
by the Committee for the Performance Period: operating earnings, net earnings,
income, earnings before interest and taxes, earnings before interest, taxes,
depreciation and amortization, total shareholder return, return on the Company’s
assets, increase in the Company’s earnings or earnings per share, revenue
growth, share price performance, return on invested capital, operating income,
pre- or post-tax, income, net income, economic value added, cash flow,
improvement in or attainment of expense levels, improvement in or attainment of
working capital levels, return on equity, debt reduction, gross profit, market
share, cost reductions, workplace safety goals, workforce satisfaction and
diversity goals, employee retention, completion of key projects, strategic plan
development, and implementation and achievement of synergy targets. Performance
Goals may be established on a Company-wide basis or with respect to one or more
business units, divisions, Subsidiaries, or products; and in either absolute
terms or relative to the performance of one or more comparable companies or an
index covering multiple companies.

When establishing Performance Goals for a Performance Period, the Committee may
exclude any or all “unusual or infrequently occurring items” as determined under
U.S. generally accepted accounting principles and as identified in the financial
statements, notes to the financial statements or management’s discussion and
analysis in the annual report, including, without

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limitation, the charges or costs associated with closures and restructurings of
the Company or any Subsidiary, discontinued operations, unusual or infrequently
occurring items, capital gains and losses, dividends, share repurchase, other
unusual, infrequently occurring or non-recurring items, and the cumulative
effects of accounting changes. Except in the case of Awards to Executive
Officers intended to be “other performance-based compensation” under
Section 162(m)(4) of the Code, the Committee may also adjust the Performance
Goals for any Performance Cycle as it deems equitable in recognition of unusual,
infrequently occurring or non-recurring events affecting the Company, changes in
applicable tax laws or accounting principles, or such other factors as the
Committee may determine (including, without limitation, any adjustments that
would result in the Company paying non-deductible compensation to a
Participant).

(b) Maximum Amount Payable. If the Committee certifies in writing that any of
the performance objectives established for the relevant Performance Period under
Section 4(a) has been satisfied, and subject to Section 4(c) or applicable law,
each Participant who is employed by the Company or one of its Subsidiaries on
the last day of the Performance Period for which the bonus is payable shall be
entitled to receive an annual bonus in an amount not to exceed $5,000,000. If a
Participant’s employment terminates for any reason other than resignation or for
Cause (as such term is defined in the Omnibus Plan) (including, without
limitation, his or her death, disability or retirement as these terms may be
defined in the Omnibus Plan) prior to the last day of the Performance Period for
which the bonus is payable, the maximum bonus payable to such Participant under
the preceding sentence shall be multiplied by a fraction, the numerator of which
is the number of days that have elapsed during the Performance Period in which
the termination occurs prior to and including the date of the Participant’s
termination of employment and the denominator of which is the total number of
days in the Performance Period.

(c) Termination of Employment. Unless otherwise determined by the Committee in
its sole discretion at the time the performance criteria are selected for a
particular Performance Period in accordance with Section 4(a), if a
Participant’s employment terminates for any reason prior to the date on which
the award is paid hereunder, such Participant shall not earn and shall forfeit
all rights to any and all awards which have not yet been paid under the Plan;
provided that if a Participant’s employment terminates as a result of death,
disability or retirement (as these terms may be defined in the Omnibus Plan) the
Committee shall give consideration at its sole discretion to the payment of a
full or partial bonus with regard to, respectively, the entirety or portion of
the Performance Period worked. Notwithstanding the foregoing, if a Participant’s
employment terminates for any reason prior to the date on which the award is
paid hereunder, the Committee, in its discretion, may waive any forfeiture
pursuant to Section 4 in whole or in part. The Committee has exercised such
discretion in the Severance Program for Management Committee Members.

(d) Negative Discretion. Notwithstanding anything else contained in Section 4(b)
to the contrary (but subject to Section 4(f)), the Committee shall have the
right, in its absolute discretion, (i) to reduce or eliminate the amount
otherwise payable to any Participant under Section 4(b) based on individual
performance or any other factors that the Committee, in its discretion, shall
deem appropriate and (ii) to establish rules or procedures that have the effect
of limiting the amount payable to each Participant to an amount that is less
than the maximum amount otherwise authorized under Section 4(b).

(e) Compensation Clawbacks. The Company may cancel or reduce, or require a
Participant to forfeit and disgorge to the Company or reimburse the Company for,
any bonus awards granted or paid under the Plan, to the extent permitted or
required by, or pursuant to any Company policy implemented as required by,
applicable law, regulation or stock exchange rule as from time to time may be in
effect (including but not limited to The Dodd–Frank Wall Street Reform and

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Consumer Protection Act and regulations and stock exchange rules promulgated
pursuant to or as a result of such Act) or otherwise.

(f) Change in Control.  Notwithstanding anything to the contrary contained
herein, in the event of a Change in Control, the annual bonus payable pursuant
to Section 4(b) with respect to the fiscal year in which the Change in Control
occurs shall not be less than the bonus amount accrued on the books and records
of the Company as of the date of the Change in Control.

SECTION 5. PAYMENT

Except as otherwise provided hereunder, payment of any bonus amount determined
under Section 4 shall be made to each Participant as soon as practicable after
the Committee certifies that one or more of the applicable performance
objectives have been attained (or, in the case of any bonus payable under the
provisions of Section 4(d), after the Committee determines the amount of any
such bonus) and in any event within two and a half months of the end of the
fiscal year in which the Performance Period ends.

SECTION 6. FORM OF PAYMENT

The Committee shall determine whether any bonus payable under the Plan is
payable in cash, in shares of Common Stock or in any combination thereof. Awards
of shares under this Plan may be issued under the Omnibus Plan in forms
including, without limitation, Restricted Stock and Restricted Stock Units. The
Committee shall have the right to impose whatever conditions it deems
appropriate with respect to the award of shares of Common Stock, including
conditioning the vesting of such shares on the performance of additional
service.

SECTION 7. GENERAL PROVISIONS

(a) Effectiveness of the Plan. The Plan shall be effective with respect to
Performance Periods beginning on or after March 7, 2007 and ending on or before
December 31, 2012, unless the term hereof is extended by action of the Board,
subject in the case of years after 2012 to approval by the Company’s
shareholders at or before its 2013 annual meeting of shareholders. Upon approval
by the Company’s shareholders at or before its 2013 annual meeting of
shareholders and at each additional meeting of shareholders at which this Plan
is approved by the Company’s shareholders, the Performance Periods and the term
hereof shall be extended for an additional five years.

(b) Amendment and Termination. Notwithstanding Section 7(a), the Board or the
Committee may at any time amend, suspend, discontinue or terminate the Plan;
provided; however, that no such action shall be effective without approval by
the shareholders of the Company to the extent necessary to continue to qualify
the amounts payable hereunder to Covered Employees as performance-based
compensation under Section 162(m).

(c) Designation of Beneficiary. Each Participant may designate a beneficiary or
beneficiaries (which beneficiary may be an entity other than a natural person)
to receive any payments which may be made following the Participant’s death.
Such designation may be changed or canceled at any time without the consent of
any such beneficiary. Any such designation, change or cancellation must be made
in a form approved by the Committee and shall not be effective until received by
the Committee. If no beneficiary has been named, or the designated beneficiary
or beneficiaries shall have predeceased the Participant, the beneficiary shall
be the Participant’s spouse or, if no spouse survives the Participant, the
Participant’s estate. If a Participant designates more than one beneficiary, the
rights of such beneficiaries shall be payable in equal shares, unless the
Participant has designated otherwise.

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(d) No Right of Continued Employment. Nothing in this Plan shall be construed as
conferring upon any Participant any right to continue in the employment of the
Company or any of its Subsidiaries.

(e) No Limitation on Corporate Actions. Nothing contained in the Plan shall be
construed to prevent the Company or any Subsidiary from taking any corporate
action which is deemed by it to be appropriate or in its best interest, whether
or not such action would have an adverse effect on any awards made under the
Plan. No employee, beneficiary or other person shall have any claim against the
Company or any Subsidiary as a result of any such action.

(f) Non-alienation of Benefits. Except as expressly provided herein, no
Participant or beneficiary shall have the power or right to transfer,
anticipate, or otherwise encumber the Participant’s interest under the Plan. The
Company’s obligations under this Plan are not assignable or transferable except
to (i) a corporation which acquires all or substantially all of the Company’s
assets or (ii) any corporation into which the Company may be merged or
consolidated. The provisions of the Plan shall inure to the benefit of each
Participant and the Participant’s beneficiaries; heirs, executors,
administrators or successors in interest.

(g) Withholding. Any amount payable to a Participant or a beneficiary under this
Plan shall be subject to any applicable Federal, state and local income and
employment taxes and any other amounts that the Company or a Subsidiary is
required at law to deduct and withhold from such payment.

(h) Severability. If any provision of this Plan is held unenforceable, the
remainder of the Plan shall continue in full force and effect without regard to
such unenforceable provision and shall be applied as though the unenforceable
provision were not contained in the Plan.

(i) Governing Law. The Plan shall be construed in accordance with and governed
by the laws of the State of Delaware, without reference to the principles of
conflict of laws.

(j) Headings. Headings are inserted in this Plan for convenience of reference
only and are to be ignored in a construction of the provisions of the Plan.

December 11, 2019

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