exhibit10_28.htm


    
      

      

    

    Exhibit
10.28

     

    Appleton
Papers Inc.

    Long
Term Restricted Stock Unit Plan

    (Effective
January 3, 2010)

     

    ARTICLE
1.

     

    Purpose and Effective
Date

     

    1.1 Purpose. The Board adopted the Plan
for the purpose of assisting the Company in attracting and retaining key
management employees who are in a position to make a significant contribution to
the growth and profitability of the Company by providing a reward for
performance and incentive for future endeavors. The Plan will be implemented
through the opportunity to earn Restricted Stock Units, the value of which is
related to the value of the Company’s stock, but Company stock is not issued at
the time of the grant, vesting or distribution.

     

    1.2 Effective Date. The effective date of
the Plan (the “Effective Date”) is January 3, 2010.

     

    ARTICLE
2.

     

    Definitions

     

    Capitalized
words and phrases used in the Plan have the following meanings unless otherwise
expressly provided herein:

     

    2.1 Board. "Board"
means the Board of Directors of Appleton Papers Inc.

     

    2.2 Cause. "Cause"
in connection with the termination of the Participant's employment with the
Company, means that, in the judgment of the Committee, based upon any
information or evidence reasonably persuasive to the Committee, the Participant:
(1) willfully engaged in activities or conducted himself or herself in a manner
seriously detrimental to the interests of the Company or its subsidiaries and
affiliates; or (2) failed to execute the duties reasonably assigned to him or
her in a reasonably timely, effective, or competent manner; provided, however,
that the termination of the Participant's employment because of Disability shall
not be deemed to be for Cause.

     

    2.3 Change of
Control. “Change
of Control” means: (1) the termination of the ESOP or amendment of the ESOP so
that it ceases to be an employee stock ownership plan; (2) the ESOP ceases to
own a majority interest in the Company; (3) the sale, lease, exchange or other
transfer of all or substantially all of the assets of the Company (in one
transaction or in a series of related transactions) to a person or entity that
is not controlled by the Company; (4) the approval by the Company shareholders
of any plan or proposal to terminate the Company’s business, to liquidate or
dissolve the Company or to sell substantially all the Common Stock; (5) the
Company merges or consolidates with any other company and the Company is not the
surviving company of such merger or consolidation; or (6) any other event or
series of events whereby ownership and effective control of the Company is
transferred or conveyed to a person or entity that is not controlled by the
Company.

     

    2.4 Committee.
“Committee” means the Compensation Committee of the Board.

     

    2.5 Common
Stock. "Common
Stock" means the common stock of Paperweight Development Corp.

     

    2.6 Company.
"Company" means Appleton Papers Inc., 825 East Wisconsin Avenue, Appleton,
Wisconsin 54911. “Company” also means (except where the context relates solely
to Appleton Papers Inc.) any subsidiary or other affiliate of Appleton Papers
Inc. who employs an Eligible Employee (as designated by the Committee in
accordance with Section 4.1). Any such subsidiary or affiliate of Appleton
Papers Inc. that has become a “Company” as provided above is deemed to have
designated Appleton Papers Inc. as its agent with respect to amending or
terminating the Plan. Any such action by Appleton Papers Inc. shall be binding
on such subsidiary or affiliate at the time taken.

     

    2.7 Disability.
“Disability” means a physical or mental condition of the Participant which
results in the Participant receiving benefits under an applicable Company’s long
term disability insurance plan, or in the event the Participant is not
participating in a Company long term disability insurance plan, means disability
as defined under the long term disability plan of Appleton Papers
Inc.

     

    2.8 Eligible
Employee.
"Eligible Employee" means an employee of Appleton Papers Inc. in the following
classifications:  (1) the Chief Executive Officer, (2) a Vice
President or Mill Manager, (3) a director-level employee; and (4) any other key
employee of a participating Company who has been designated by the CEO as an
Eligible Employee.

     

    2.9 Employment.
References
in the Plan to “employment” with the Company; “year(s) of employment” and
“termination of employment” shall in all events refer to the total period of
employment with Appleton Papers Inc. and any of its subsidiaries or affiliates.
For example, a Participant’s termination of employment for purposes of the Plan
shall occur at the time the Participant is no longer employed by Appleton Papers
Inc., or any of its subsidiaries or affiliates.

     

    2.10 ESOP. "ESOP"
means the Appleton Papers Retirement Savings and Employee Stock Ownership
Plan.

     

    2.11 Fair Market
Value. “Fair
Market Value” means the value of a Restricted Stock Unit which is equal to the
fair market value most recently assigned to Common Stock under the terms of the
ESOP prior to the Grant Date or Vesting Date. For example, the value of a
Restricted Stock Unit vesting between January 1 and June 30 will be based on the
fair market value assigned to the Common Stock under the ESOP on the prior
December 31 valuation. The value of a Restricted Stock Unit vesting between July
1 and December 31 will be based on the prior June 30 valuation.

     

    2.12 Participant.
“Participant” means an Eligible Employee who has been granted Restricted Stock
Units in accordance with Article 4 of the Plan.

     

    2.13 Plan. “Plan”
means the Appleton Papers Inc. Long Term Restricted Stock Unit Plan, as set
forth herein and as amended from time to time.

     

    2.14 Plan Year. “Plan
Year” means the fiscal year of Appleton Papers Inc.

     

    2.15 Representative.
“Representative” means the personal representative of the Participant's estate,
and after final settlement of the Participant's estate, the successor or
successors entitled thereto by law.

     

    2.16 Restricted Stock
Unit.
“Restricted Stock Unit” means a bookkeeping unit and accounting mechanism
designed to measure the value of a nonequity compensation unit payable as
taxable compensation to the Participant in accordance with Article 5. One
Restricted Stock Unit has a value equal to the value of one share of Common
Stock (as determined pursuant to Section 5.6).

     

    2.17 Retirement.
“Retirement” means termination of employment with the Company under a
tax-qualified retirement plan maintained by the Company or an applicable
subsidiary or affiliate, including early retirement under such
plan.

     

    2.18 Vesting Date.
“Vesting Date” means the date on which a Participant’s Restricted Stock Units
vest under the provisions of Article 5.

     

    ARTICLE
3.

     

    Plan
Administration

     

    3.1 Committee
Administration. The
Committee shall be responsible for the operation and administration of the Plan.
The decision of a majority of the members of the Committee shall consti­tute
the decision of the Committee. The Committee may act either at a meeting at
which a majority of the members of the Committee is present or by a writing
signed by all Committee members. The Committee shall have full discretion, power
and authority to make factual determinations, construe, interpret and administer
the Plan, to adopt such rules and regulations governing the administration of
the Plan, and shall exercise all other duties and powers conferred on it by the
Plan, or which are incidental or ancillary thereto, and may designate agents to
assist it in administration of the Plan. The Committee shall have the sole,
final and conclusive authority to determine, consistent with and subject to the
provisions of the Plan, the Eligible Employees, Maximum Reserved Units, the
number of Restricted Stock Units to be awarded to individual Participants
reporting to the CEO, and all other matters relating to the Plan. Benefits will
be paid only if the Committee determines in its discretion that the applicant is
entitled to them.

     

    3.2 Maximum Reserved
Units. The
maximum number of Restricted Stock Units that may be granted each year shall be
authorized by the Compensation Committee of the Board of Directors in accordance
with the executive compensation goals and policies.

     

    3.3 Changes in Capital
Structure. If
there is a change in the outstanding Common Stock by reason of the issuance of
additional units, recapital­ization, reclassification, reorganization or
similar transaction, the Committee shall proportionately adjust, in an equitable
manner, the aggregate number of available Restricted Stock Units and the number
of Restricted Stock Units held by Partici­pants. The adjustment shall be
made in a manner that will cause the value of Restricted Stock Units at the time
of the transaction to remain unchanged as a result of the
transaction.

     

    ARTICLE
4.

     

    Participation and
Awards

     

    4.1 Annual
Grants.
Restricted Stock Units shall be granted, as of the first day of a Plan Year (the
“Grant Date”), to all Eligible Employees who are Participants with respect to
that Plan Year. By February 28, the Committee shall determine and approve the
number of Restricted Stock Units awarded to the CEO, the number of Restricted
Stock Units awarded to individual Participants reporting to the CEO, and the
Maximum Reserve Units. The number of Restricted Stock Units awarded to each
Participant for the upcoming Plan Year shall be approved by the CEO, with input
from other Vice Presidents, before February 28 of each Plan Year. The CEO shall
notify Participants of the Units awarded for a Plan Year (“Grant Confirmation”)
as soon as administratively practical after such awards have been approved.
Participants who have been invited to receive a Grant, must accept the Grant by
signing an Acknowledgement form provided by the Company.

     

    4.2 New Hires and Employment
Classification Changes. An
individual who becomes a Participant after the beginning of a Plan Year, either
as a newly hired employee or as a result of a change in employment
classification, shall be entitled to receive a grant of Restricted Stock Units
at the discretion of the Committee or the CEO in accordance with Section
4.1.

     

    ARTICLE
5.

     

    Vesting and Payment of
Units

     

    5.1 Vesting. A
Restricted Stock Unit shall be 100% vested upon the completion of three (3) full
years of employment commencing with the Grant Date of the Restricted Stock Unit
or, if earlier, upon the occurrence of a Change of Control. Upon termination of
employment due to the Participant’s death, Disability or Retirement, an award of
Restricted Stock Units shall be 0% vested if such employment termination occurs
before the completion of one (1) full year of employment commencing with the
Grant Date, 33.3% vested if such employment termination occurs on or after the
completion of one (1) full year of employment, but before completion of two (2)
full years of employment commencing with the Grant Date, and shall be 66.7%
vested if such employment termination occurs on or after the completion of two
(2) full years of employment but before the completion of three (3) full years
of employment commencing with the Grant Date. Retirements on December 31 of any
given Plan Year shall be treated as a full year of employment for vesting
purposes. Any grant of Restricted Stock Units, or portion thereof, not vested
according to the foregoing schedule on the date of the Participant's termination
of employment for any reason shall be forfeited.

     

    5.2 Payment For Vested
Units. Upon
the vesting of Restricted Stock Units in accordance with Section 5.1, payment,
less applicable withholding taxes, shall be made to the Participant (or to the
Participant’s Representative in the event of the Participant’s death) in a
single sum cash payment in an amount equal to the value of the Restricted Stock
Unit as determined under Section 5.3. This cash payment will be paid in the
currency in which such Participant is paid the majority of his or her
remuneration by multiplying the amount by the appropriate currency exchange rate
as posted in the Wall Street Journal on the last date of the valuation of the
Common Stock. Payment will be made as soon as administratively practicable after
vesting, but no later than two and one-half months following yearend of the
taxable year in which vesting occurred, provided, however, that if it is
administratively impracticable to make the payment by such date, or if the
payment would jeopardize the ability of the Company to continue as a going
concern, then such payment shall be made as soon as administratively practicable
or as soon as the payment would no longer have such effect.

     

    5.3 Unit
Valuation. The
value represented by a  Restricted Stock Unit shall be the greater of:
(1) the Fair Market Value of a share of Common Stock; (2) the price per share of
Common Stock received as a result of a Change of Control; or (3) a public
offering price.

     

    5.4 Tax
Withholding. The
Company shall deduct from payments made under the Plan any federal, state or
local withholding or other taxes or charges which the Company is required to
deduct under applicable law.

     

    5.5 Change of Control Tax
Provisions. If any
payments provided to a Participant under this Plan will be subject to the tax
imposed by Section 4999 of the Internal Revenue Code (the “Excise Tax”), the
Company shall pay to the Participant, at the time the payments are paid to the
Participant, an additional amount (the “Gross-Up Payment”) such that the net
amount retained by the Participant, after deduction of any Excise Tax on the
payments and any federal, state and local income tax and Excise Tax on the
Gross-Up Payment itself, shall be equal to the payments. The Participant remains
responsible for any federal, state and local income tax on the
payment.

     

    For
purposes of determining whether any of the payments will be subject to the
Excise Tax and the amount of such Excise Tax, (i) any other payments or benefits
received by a Participant in connection with a Change of Control or a
Participant’s termination of employment shall be treated as “parachute payments”
within the meaning of section 280G(b)(2) of the Code, and all “excess parachute
payments” within the meaning of section 280G(b)(1) shall be treated as subject
to the Excise Tax, unless in the opinion of tax counsel selected by the
Company’s independent auditors and acceptable to the Participant such other
payments or benefits (in whole or in part) do not constitute parachute payments,
or such excess parachute payments (in whole or in part) represent reasonable
compensation for services actually rendered within the meaning of Section
280G(b)(4) of the Code, (ii) the amount of the payments which shall be treated
as subject to the Excise Tax shall be equal to the lesser of (A) the total
amount of the payments or (B) the amount of excess parachute payments within the
meaning of Sections 280G(b)(1) and (4) (after applying clause (i) above, and
after deducting any excess parachute payments in respect of which payments have
been made), and (iii) the value of any non-cash benefits or any deferred payment
or benefit shall be determined by the Company’s independent auditors in
accordance with the principles of Sections 280G(d)(3) and (4) of the Code. For
purposes of determining the amount of the Gross-Up Payment, the Participant
shall be deemed to pay federal income taxes at the highest marginal rate of
federal income taxation in the calendar year in which the Gross-Up Payment is to
be made and state and local income taxes at the highest marginal rates of
taxation in the state and locality of the Participant’s residence on the date of
the Participant’s termination of employment, net of the maximum reduction in
federal income taxes which could be obtained from deduction of such state and
local taxes.

     

    If the
Excise Tax is subsequently determined to be less than the amount taken into
account hereunder, the Participant shall repay to the Company, at the time that
the amount of such reduction in Excise Tax is finally determined, the portion of
the Gross-Up Payment attributable to such reduction. If the Excise Tax is
determined to exceed the amount taken in account hereunder (including by reason
of any payment the existence or amount of which cannot be determined at the time
of the Gross-Up Payment), the Company shall make an additional gross-up payment
in respect of such excess to the Participant (plus any interest payable with
respect to such excess) at the time that the amount of such excess is finally
determined.

     

    5.6 Forfeitures.
Notwithstanding any other provision of the Plan, all rights to any payments
under the Plan, shall be discontinued and forfeited, and the Company will have
no further obligation to the Participant if

     

    
      	
              a.        

            	
              the
      Participant is discharged from employment with the Company or its
      subsidiaries and affiliates for Cause, or the Participant performs during
      the course of his employment with the Company or its subsidiaries and
      affiliates acts of willful malfeasance or gross negligence in a matter of
      material importance to the Company,
or

            


    

     

    
      	
              b.        

            	
              the
      Participant violates any express restrictive covenant between Participant
      and Company (whether relating to obligations of confidentiality,
      non-competition, non-solicitation or
otherwise).

            


    

     

    Absent a
Change of Control, any decision of the Committee with respect to the application
of the provisions of this Section 5.6 shall have a presumption of correctness,
and the burden shall be on the Participant to rebut such presumption by clear
and convincing evidence.

     

    5.7 Presumed
Competency. Every
person receiving or claiming payments under the Plan shall be conclusively
presumed to be mentally competent until the date on which the Company receives a
written notice in a form and manner acceptable to the Company that such person
is incompetent and that a guardian, conservator or other person legally vested
with the interest of his or her estate has been appointed. In the event a
guardian or conservator of the estate or any person receiving or claiming
payments under the Plan shall be appointed by a court of competent jurisdiction,
payments under the Plan may be made to such guardian or conservator provided
that the proper proof of appointment and continuing qualifica­tion is
furnished in a form and manner acceptable to the Company. Any such payments so
made shall be a complete discharge of any liability or obligation of Company or
the Committee regard­ing such payments.

     

    5.8 Forfeiture of Unclaimed
Benefits. Each
Participant shall keep the Company informed of his or her current address. The
Company shall not be obligated to search for the whereabouts of any person. If
the Company is unable to locate any person to whom a payment is due under the
Plan or a distribution payment check is not presented for payment, such payment
shall be irrevocably forfeited at the earlier of: (1) the day preceding the date
such payment would otherwise escheat pursuant to any applicable escheat law; or
(2) the later of three (3) years after the date on which the payment was first
due or ninety (90) days after issuance of the check. Forfeited payments shall be
returned to the Company.

     

    ARTICLE
6.

     

    Miscellaneous
Provisions

     

    6.1 Nonguarantee of
Employment. No
employee or other person shall have any claim or right to participate in the
Plan except as designated by the Committee. Neither the Plan nor any action
taken pursuant to the Plan shall be construed as giving any employee any right
to be retained in the employ of the Company.

     

    6.2 No Rights as
Shareholder.
Restricted Stock Units shall not entitle the Participant to an equity interest
in the Company nor give the Participant the rights of a shareholder ­in the
Company.

     

    6.3 Nonassignable.
Restricted Stock Units are an unfunded promise to pay and are not property. Any
rights and privileges represented by a Restricted Stock Unit may not be
trans­ferred, assigned, pledged or hypothecated in any manner, by operation
of law or otherwise, and shall not be subject to execution, attachment or
similar process except as provided in Section 6.5.

     

    6.4 Unfunded
Plan. The
Plan shall at all times be unfunded and no provision shall at any time be made
with respect to segregating assets of the Company for payment of benefits under
the Plan. No Participant or other person shall have any interest in any
particular assets of the Company and shall have only the rights of a general
unsecured creditor of the Company with respect to any rights under the
Plan.

     

    6.5 Offsets. As a
condition to eligibility to participate in the Plan, each Participant
consen­ts to the deduction from amounts otherwise payable to the Participant
under the Plan all amounts owed by the Participant to the Company and its
subsidiaries and affiliates to the maximum extent permitted by applicable
law.

     

    6.6 Limitation of
Actions. No
lawsuit with respect to any benefit payable or other matter arising out or
relating to the Plan may be brought before exhaustion of claim and review
procedures established by the Committee, and any lawsuit must be filed no later
than nine (9) months after a claim is denied or be forever barred.

     

    6.7 Amendment and
Termination. The
Board may amend or terminate the Plan at any time provided that no amendment to
the Plan may alter, impair or reduce the number of  Restricted Stock
Units earned before the effective date of the amendment without the written
consent of the affected Participants. No Restricted Stock Units may be awarded
after the date of Plan termination although payments shall be made in accordance
with the Plan with respect to Restricted Stock Units awarded before the date of
Plan termination.

     

    6.8 Internal Revenue Code
Section 409A. The Plan is intended to be exempt from the coverage of
Internal Revenue Code Section 409A, and shall be administered and interpreted in
such a way as to maintain the status of the Plan as being so
exempt.

     

    6.9 Governing Law;
Jurisdiction. The
Plan shall be governed by, and construed in accordance with, the laws of the
State of Wisconsin. By participating in the Plan, the Participant irrevocably
consents to the exclusive jurisdiction of the courts of the State of Wisconsin
and of any federal court located in Milwaukee, Wisconsin in connection with any
action or pro­ceeding arising out of or relating to the Plan, any document
or instrument delivered pursuant to or in connection with the Plan.