Exhibit 10.25



 





EXHIBIT
10.25









RESTRICTED SHARE UNIT PLAN




 









 





			
	Abitibi-Consolidated Inc.
	 	RESTRICTED SHARE UNIT PLAN






Table of contents




	 	 	 	 	 
	1. PURPOSE
	 	 	1	 
	 
	 	 	 	 
	2. ADMINISTRATION
	 	 	1	 
	 
	 	 	 	 
	3. PARTICIPANTS
	 	 	1	 
	 
	 	 	 	 
	4. DEFINITIONS
	 	 	1	 
	 
	 	 	 	 
	5. GRANT OF RESTRICTED SHARE UNITS
	 	 	2	 
	 
	 	 	 	 
	6. EARNED AWARDS
	 	 	2	 
	 
	 	 	 	 
	8. TERMS OF RESTRICTED SHARE UNITS
	 	 	3	 
	 
	 	 	 	 
	(A) Vesting 
	 	 	3	 
	(B) Non-transferability 
	 	 	3	 
	(C) Termination of Employment 
	 	 	3	 
	(D) Payment of Plan Award Value 
	 	 	4	 
	 
	 	 	 	 
	9. CHANGES IN SHARE CAPITAL
	 	 	4	 
	 
	 	 	 	 
	10. AMENDMENT
	 	 	4	 
	 
	 	 	 	 
	11. UNFUNDED PLAN
	 	 	5	 
	 
	 	 	 	 
	12. TERMINATION
	 	 	5	 






 









 





ABITIBI-CONSOLIDATED INC.

RESTRICTED SHARE UNIT PLAN





	1.	 	PURPOSE
	 
	 	 	The purpose of the Abitibi-Consolidated Inc. (together with its subsidiaries, the
“Company”) Restricted Share Unit Plan (the “Plan”) is to: 1) promote a greater alignment
between the interests of shareholders and key employees (Executives and high-potential /
high performing Managers); 2) reward and retain key employees of the Company; and 3) link
key employees’ total direct compensation with the long term performance of the Company.
	 
	2.	 	ADMINISTRATION
	 
	 	 	The Plan shall be administered by the Human Resources and Compensation Committee (the
“Committee”) of the Board of Directors (the “Board”) of Abitibi-Consolidated Inc. or such
other committee as may be designated by the Board. The Committee and the Board shall have
the full and complete authority to interpret and to modify the Plan, prescribe such rules
and regulations, as appropriate, and make such other determinations as it deems necessary
or desirable for the administration of the Plan. All decisions and determinations of the
Committee and the Board respecting the Plan shall be binding and conclusive on the Plan and
the Participants (as defined herein).
	 
	3.	 	PARTICIPANTS
	 
	 	 	The Committee shall, in its sole discretion, designate, from time to time, any of the key
employees of the Company, as described in Section 1 hereof, (including directors but
excluding directors who are not officers or salaried employees) as participants in the Plan
(the “Participants”). The Committee may delegate to the Chief Executive Officer the
authority to grant a certain number of Restricted Share Units’ to high performing and/or
high potential non-Executive or non-officer employees of the Company selected by the Chief
Executive Officer, who shall then be treated as Participants.. No person shall be entitled
to participate in the Plan and the decision as to who shall have the opportunity to
participate in the Plan and the extent of the participation will, subject to the terms
hereof, be made by the Committee in its sole and absolute discretion.
	 
	4.	 	DEFINITIONS
	 
	 	 	For purposes of this Plan:






	 	(i)	 	“Common Shares” means the common shares in the capital of
Abitibi-Consolidated Inc., and includes any shares of Abitibi-Consolidated
Inc. into which such shares may be converted, reclassified, redesignated,
subdivided, consolidated, exchanged or otherwise changed, pursuant to a
Reorganization or otherwise;
	 
	 	(ii)	 	“Financial Performance Criterion” means such corporate
accounting or financial measure, ratio or calculation as may be selected on an
annual basis by the Committee;





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	 	(iii)	 	“Performance Period” means 3 years or another period
specifically established by the Committee and set out in the
Grant Letter;
	 
	 	(iv)	 	“Reorganization” means any (i) capital reorganization, (ii)
merger, (iii) amalgamation, (iv) offer for Common Shares,
which, if successful, would entitle the offeror to acquire
all of the Common Shares, or (v) arrangement or other scheme
of reorganization;
	 
	 	(v)	 	“Ranking Schedule” means a list of comparator companies
indicating the percentage (%) of a Participant’s RSU award
that vests based on the number of comparator companies the
Company beats in terms of the selected Financial Performance
Criterion;
	 
	 	(vi)	 	“Restricted Share Unit(s)” or “RSU(s)” means a phantom unit
with a value pegged to the Common Shares’ actual stock price
and which has time and financial performance vesting
restrictions tied to it that define the portion and when any
given award is actually earned by the Participant.
	 
	 	(vii)	 	“Closing Value” means the closing price of a Common Share on
the last trading day immediately prior to the end of the
Performance Period on the principal stock exchange on which
the Common Shares are traded;
	 
	 	(viii)	 	“Plan Award Value” means the dollar value of the number of
RSUs which vest multiplied by the Closing Value;






	5.	 	GRANT OF RESTRICTED SHARE UNITS






	 	(a)	 	At the time of the grant, the Board, upon recommendation from the Committee,
shall determine the number of Restricted Share Units to be granted to each
Participant and the vesting and other terms of such grant. The Chief
Executive Officer shall determine the number of Restricted Share Units for
which the granting authority was delegated to him by the Board to be granted
to each non-Executive and/or non-officer Participant.
	 
	 	(b)	 	As soon as practical after determining the grant of a Participant, the
Committee shall cause a notice in writing (the “Grant Letter”) to be given
to the Participant. The Grant Letter shall set out the following
information: (i) the number of Restricted Share Units granted to the
Participant; (ii) the Ranking Schedule (which is subject to adjustment, if
required, per section 6(a)); (iii) the length of the Performance Period; and
(iv) any additional time vesting conditions.
	 
	 	(c)	 	All Restricted Share Units granted under the Plan shall be subject to the
terms and conditions of the Grant Letter as well as the terms of this Plan.
	 
	 	(d)	 	The Committee will approve a Ranking Schedule for each Performance Period.






	6.	 	EARNED AWARDS






	 	(a)	 	At the end of each Performance Period, the Committee shall determine
the extent, if any, to which the Participant has earned his Restricted Share
Units. Such determination will be based upon the Ranking Schedule. The
Committee may modify the Financial





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	 	 	 	Performance Criterion at its discretion prior to the start of
any given Performance Period. The Committee may also adjust the
Ranking Schedule during the term of an award should one or more
of the companies become inappropriate or cease in its then
current form during the Performance Period.
	 
	 	(b)	 	The number of Restricted Share Units earned by the Participant
will be based upon the Ranking Schedule that is set out in the
Grant Letter.






	7.	 	AWARD PAYMENTS






	 	(a)	 	At the end of each Performance Period, the value of the Participant’s
Restricted Share Units will be equal to the number of Restricted
Share Units earned by such Participant in accordance with paragraphs
6(a) and 6(b) hereof multiplied by the Closing Value.
	 
	 	(b)	 	The award payments will be made in cash and/or by the delivery of
Common Shares purchased by the Company on the open market. The form
of award payments shall be made by the Committee at its sole
discretion. The award payments shall be made by no later than March
15 of the calendar year immediately following the calendar year in
which the award payment vests in accordance with Section 6(a).






	8.	 	TERMS OF RESTRICTED SHARE UNITS






	 	(a)	 	Vesting






Awarded Restricted Share Units will vest in accordance with Section 6(a).




	 	(b)	 	Non-transferability






The Plan Award Value is payable only to the Participant or, in the event of his
death, his heirs or other legal representatives, as hereinafter provided. A
Participant shall not be entitled to transfer, assign, charge, pledge or
hypothecate, or otherwise alienate, whether by operation of law or otherwise, a
Restricted Share Unit and shall not be subject to execution, attachment or similar
process.




	 	(c)	 	Termination of Employment






Notwithstanding the foregoing provisions of this Section 8, if the employment of
any Participant shall be terminated so that he is no longer employed by the
Company, his entitlement to a payment in respect of his Restricted Share Units
shall be determined as follows:




(i) if the employment of such Participant shall terminate by
termination for cause or in the event the Participant voluntarily
terminates his employment with the Company, then all unvested RSUs as
of the date of termination of employment, shall forthwith become void
and no amount shall be payable to the Participant unless otherwise
determined by the Committee.




(ii) if the employment of such Participant shall terminate by
retirement or involuntary termination leading to retirement
eligibility at termination or immediately following the severance
period, then vesting of previously granted RSUs will proceed as if
the employee was actively at work.



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(iii) if the employment of such Participant shall terminate by
involuntary termination otherwise than as referred to in sub-paragraph
(c)(ii) of this paragraph, then vesting of previously awarded RSUs will
proceed based on prorated time worked in relation to the Performance
Period, including the severance period.




(iv) if the employment of such Participant shall terminate by death,
then one of the following vesting arrangements will apply:




	 	 	 	a- during employment: vesting
based on prorated time worked in relation to the
Performance Period
	 
	 	 	 	b- after retirement: vesting will continue based on time worked and the period of
retirement up to the date of death prorated over the Performance Period

	 
	 	 	 	c- after involuntary
termination (including if termination is immediately
followed by retirement): vesting will continue as if
actively at work, including the severance period, no
later than the date of death, prorated over the
Performance Period.







	 	(d)	 	Payment of Plan Award Value






The Company shall deduct any taxes that are required to be deducted by any applicable
law from payments to Participants. All taxes due are the full and sole responsibility
of the Participant.




	9.	 	CHANGES IN SHARE CAPITAL
	 
	 	 	In the event of any change in the outstanding Common Shares by reason of any stock
dividend (other than an issue of shares to shareholders pursuant to their election to
receive dividends in the form of shares in lieu of cash dividends declared payable in
the ordinary course by Abitibi-Consolidated Inc.), stock split or consolidation, or
Reorganization, the Committee shall make such substitution or adjustment to the terms
of the Restricted Share Units as it deems appropriate including, without limiting the
generality of the foregoing, appropriate provisions for the continuance or other
recognition of outstanding rights under the Plan.
	 
	10.	 	AMENDMENT






	 	(a)	 	The Board may at any time, and from time to time, by resolution and
without other formality amend the Plan in any respect, provided that
no amendment shall operate to affect materially any rights already
acquired by a Participant under the Plan.
	 
	 	 	 	Without amending the Plan the Committee may with the consent of any
Participant, approve any variation in terms of that Participant’s
Restricted Share Units.
	 
	 	(b)	 	The cost of the operation of the Plan shall be borne by the Company.
	 
	 	(c)	 	All notices under the Plan shall be in writing and, if to the Company,
shall be delivered to the Company or sent by first class post to their
respective head or registered offices for the time being, and if to a
Participant, shall be delivered personally or sent by first class





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	 	 	 	post to the Participant at the address which he shall give for the purpose, or
failing any such address to his last known place of abode. If a notice is sent by
post, service thereof shall be deemed to be effected by properly addressing,
prepaying and posting a letter containing the same to such address and shall be
deemed to be served forty-eight hours after such posting.






	11.	 	UNFUNDED PLAN
	 
	 	 	The Plan shall be unfunded. To the extent that a Participant holds any rights by virtue of
a grant of Restricted Share Units such rights shall be no greater than the rights of an
unsecured general creditor of the Company.
	 
	12.	 	TERMINATION
	 
	 	 	The Board may at any time terminate the Plan provided that the existing rights of
Participants will not thereby be affected.





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APPENDIX 1 — Special Provisions for Senior Management Participants



1- Senior Executives and officers who have Company share ownership obligations will receive
the appropriate portion of their award in Common Shares until their respective holding
requirements have been met.



Consequently, all or a portion of a calculated earned payment (less applicable income taxes) will
be made to the Participant in the form of Common Shares which must be held by the Participant in
order to comply with his stock ownership guidelines.



2- After the commencement of the Performance Period, the Committee may designate additional
eligible Senior Executives as Participants in the Plan (the “Mid-Term Participants”). Mid-Term
Participants’ initial grant will be prorated based on time to be worked during the Performance
Period.




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APPENDIX 2 — Financial Performance Criterion, Comparator Group and Ranking Schedule for
grant



[appropriate information from HRCC approved guidelines to be inserted for each grant]





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