Exhibit 10.11


 


SCHWEITZER-MAUDUIT
INTERNATIONAL, INC.


EXECUTIVE SEVERANCE PLAN


 


Amended and Restated -


As of December 4,
2008


 

















 


SCHWEITZER-MAUDUIT INTERNATIONAL, INC.


EXECUTIVE SEVERANCE PLAN
FOR KEY EMPLOYEES


AMENDED AND RESTATED AS
OF DECEMBER 4, 2008


 


ARTICLE 1 - PURPOSE AND
ADOPTION OF PLAN


 


1.1                                Adoption
of Plan.  Schweitzer-Mauduit
International, Inc. (“Company”) hereby amends and restates the
Schweitzer-Mauduit International, Inc. Executive Severance Plan as of February 24,
2000.  The Company intends that this Plan
qualify as and come within the various exceptions and exemptions under the
Employee Retirement Income Security Act of 1974 (“ERISA”), as amended, for an
unfunded plan maintained primarily for a select group of management or highly
compensated employees, and any ambiguities in this Plan shall be construed to
effect that intent.  The benefits of this
Plan for U.S. Employees (as hereinafter defined) shall be paid solely from the
general assets of the Company.  The
benefits of this Plan for French Employees (as hereinafter defined) shall be
paid by the French Employer (as hereinafter defined) but, if as a result of
applicable French laws, a French Employer would be prohibited from paying the
benefits of this Plan to a French Employee, any such benefits shall be paid by
the Company to such French Employee.


 


1.2                                Purpose.  The Plan is primarily designed to provide
benefits to certain Key Employees (as hereinafter defined) upon termination of
employment as a result of a Change of Control or otherwise.


 


1.3                                Effect
on Other Plans Sponsored by the Company or by a French Employer.  The benefits payable under the Plan are in
addition to the coverage and benefits generally afforded by Other Plans (as
hereinafter defined) to Key Employees terminating from the


 


1

















 


service of the Company
or, as the case may be, from the service of a French Employer and any other
programs sponsored by the Company or provided to Participants who are French Employees
including, but not limited to, vested benefits under any qualified employee
benefit plans.  However, nothing herein
is intended to or shall be construed to require the Company or a French
Employer to institute or continue in effect any particular plan or benefit
sponsored by the Company or such French Employer, and the Company and each
French Employer hereby reserve the right to amend or terminate any of their
Other Plans or benefit programs at any time in accordance with the procedures
set forth in each such plan or program and any applicable law.


 


The masculine pronoun
shall be construed to include the feminine pronoun and singular shall include
the plural where the context so requires.


 


ARTICLE 2 - DEFINITIONS


 


2.1                                “Administrator”
shall mean the Compensation Committee of the Board.  Following a Change of Control, the
Administrator shall be the Trustee of a grantor trust established by the
Company that includes this Plan.


 


2.2                                “Agreement”
shall mean the participation agreement provided to a Key Employee by the
Administrator as provided in Section 3.2.


 


2.3                                “Annual
Compensation” shall mean:


 


a)                                 For
U.S. Employees, a Participant’s rate of base salary paid or payable for a
calendar year by the Company and any incentive award paid or payable to such
Participant pursuant to the Schweitzer-Mauduit International, Inc. Annual
Incentive Plan (the “SMI Annual Incentive Plan”) or any replacement or
successor to such plan for such calendar year.


 


2

















 


b)                                For
French Employees, a Participant’s rate of base salary paid or payable for a
calendar year by his French Employer, plus any incentive award paid or payable
to such Participant pursuant to the SMI Annual Incentive Plan  or any replacement or successor to such plan for such
calendar year, plus any profit-sharing paid or payable by his French Employer
attributable to such calendar year minus the aggregate amount of (i) any
Convention  Collective payments, (ii) Assedic
Payments, or (iii) private insurance payments paid or payable to such
Participant as a result of a Change of Control Termination.


 


2.4                                “Basic
Plan” shall mean the Securite Sociale retirement benefit plan sponsored by the
French Government.


 


2.5                                “Board”
shall mean the Board of Directors of Schweitzer-Mauduit International, Inc.


 


2.6                                “Cause”
shall mean the termination of the Participant’s employment by the Company or by
his French Employer, as the case may be, on the basis of criminal or civil
fraud on the part of the Participant.


 


2.7                                “Change
of Control” shall mean the date as of which: (a) a third person,
including a “group” as defined in Section 13(d)(3) of the Securities
Exchange Act of 1934, acquires actual or beneficial ownership of shares of the
Company having 15% or more of the total number of votes that may be cast for
the election of Directors of the Company; or (b) as the result of any cash
tender or exchange offer, merger or other business combination, sale of assets
or contested election, or any combination of the foregoing transactions (a “Transaction”),
the persons who 


 


3

















 


were directors of the
Company before the Transaction shall cease to constitute a majority of the
Board of Directors of the Company or any successor to the Company.


 


2.8                                “Change
of Control Termination” shall mean the termination of a Participant’s
employment by the Company or his French Employer, as the case may be, within
two years of a Change of Control for any reason other than for Cause,
Retirement, Disability or the Participant’s death.


 


2.9                                “Code”
shall mean the Internal Revenue Code of 1986, as amended.


 


2.10                          “Company”
shall mean Schweitzer-Mauduit International, Inc. and each of its
successors and assigns.


 


2.11                          “Complementary
Plan” shall mean the national pension plans for French Employees and workers
sponsored by the Association des Régimes de Retraite Complémentaires (“ARRCO”)
and the Association Généralé des Institutions de Retraite des Cadres (“AGIRC”),
respectively.


 


2.12                          “Disability”
shall mean Totally and Permanently Disabled, within the meaning of the
Retirement Plan, provided that the Administrator shall make any such
determination with respect to a Participant hereunder.


 


2.13                          “French
Employee” shall mean an individual employed by one of the French Employers.


 


2.14                          “French
Employer(s)” mean Schweitzer-Mauduit France, S.A.R.L. or LTR Industries,
S.A., and their respective successors and subsidiaries.


 


2.15                          “French
Supplementary Plans” shall mean the supplementary pension benefit plans
provided, respectively, by Papeteries de Mauduit, S.A. and LTR Industries, S.A.
to their employees.


 


4

















 


2.16                          “Key  Employee” shall mean an individual who is a member of a
select group of management or highly compensated French Employees and/or U.S.
Employees, as determined from time to time by the Administrator.


 


2.17                          “Other
Plans” shall mean other plans of the Company or of the French Employer,
including but not limited to the Schweitzer-Mauduit International, Inc.
Annual Incentive Plan, the Schweitzer-Mauduit International, Inc. Equity
Participation Plan, the Schweitzer-Mauduit International, Inc. Long-Term
Incentive Plan, Schweitzer-Mauduit International, Inc. Restricted Stock
Plan,  Schweitzer-Mauduit International, Inc.
Deferred Compensation Plan.


 


2.18                          “Participant”
shall mean a Key Employee who has entered into an Agreement with the
Administrator in accordance with Section 3.2.


 


2.19                          “Plan”
shall mean this Schweitzer-Mauduit International, Inc. Executive Severance
Plan.


 


2.20                           “Retirement”
shall mean


 


a)                                    For
U.S. Employees, the voluntary termination of the Participant’s employment by
the Company pursuant to the terms of the qualified defined benefit pension plan
of the Company, which termination was initiated by such Participant in writing
pursuant to the procedures of such qualified defined benefit pension plan prior
to a Change of Control notwithstanding the Participant’s actual retirement date
occurs after a Change of Control.


 


b)                                   For
French Employees, the voluntary termination of the Participant’s employment by
his French Employer as a result of such Participant’s retirement pursuant to
the terms of the Basic Plan, the Complementary Plan and, if applicable, the
French Supplementary Plan, which termination was initiated by


 


5

















 


such Participant in writing pursuant to the procedures of such Basic
Plan, Complementary Plan and, if applicable, French Supplementary Plan prior
Change of Control, notwithstanding that the Participant’s actual retirement
date occurs after a Change of Control.


 


2.21                           “Retirement
Plan” shall mean the Schweitzer-Mauduit International, Inc. Retirement
Plan, as amended and restated as of July 1, 2000 and including amendments
2001-1, 2001-2, 2002-2 and 2003-1.  For
clarity and to avoid confusion, the term Retirement Plan for the purposes of
this Plan shall not refer to or include the terms of any amendment of the
Retirement Plan impacting the benefits of a participant therein made subsequent
to July 1, 2000 other than those specifically identified hereinabove.


 


2.22                           [Reserved]


 


2.23                           “U.S.
Employee” shall mean individuals employed by the Company.


 


2.24                           “Voluntary
Resignation” shall mean termination of a Participant’s employment with the
Company or the French Employer(s) as a result of a resignation initiated
by the Participant which is unrelated to any act or omission of the Company or
the French Employer, as the case may be, which could not reasonably be
construed to be a constructive discharge of such Participant.


 


2.25                           “Deferred
Compensation Plan” shall mean the Schweitzer-Mauduit International, Inc.
Deferred Compensation Plan, amended and restated as of February 26, 2004,
and the Schweitzer-Mauduit International, Inc. Deferred Compensation Plan No. 2,
effective as of January 1, 2005.


 


6

















 


ARTICLE 3 - ELIGIBILITY


 


3.1                                 Eligibility
to Participate.  The Administrator
shall from time to time determine in writing the Key Employees who are eligible
to participate in this Plan.  A list of
current Participants shall be set forth on Appendix A hereto, as updated by the
Committee from time to time.


 


3.2                                 Agreement.  The Administrator shall enter into a
participation agreement with each Key Employee the Administrator determines to
be eligible for participation in this Plan. Such Agreement shall identify the
Key Employee as a Participant in this Plan and shall contain such terms as
deemed appropriate by the Administrator, but shall be consistent with and
governed by the terms of this Plan.


 


ARTICLE 4 - SEVERANCE
BENEFITS


 


4.1                                 Termination
Following Change of Control.  A
Participant shall be entitled to receive benefits under this Plan following a
Change of Control as follows:


 


a)                                      Subject
to Section 4.1 (b), a Participant’s employment with the Company or his
French Employer, as the case may be, shall terminate within two years of a
Change of Control for any reason other than for Cause, Retirement, Disability
or the Participant’s death.


 


b)                                        A
Participant that has been requested in writing by the Company or the French
Employer, as the case may be, to continue in the employment of the Company or
the French Employer through a specified date, which shall not be more than six (6) months
from the date of a Change of Control, under terms and conditions of employment,
at the place of employment and with the same salary and benefits that the
Participant was provided prior to the Change of Control, shall have 


 


7

















 


satisfied such request by
remaining in the employment of the Company or the French Employer for the
specified period.


 


c)                                     A
Participant entitled to benefits under this Plan shall receive and the Company
or, subject to the provisions of Section 1.1, the French Employer, as the
case may be, shall pay or, with respect to certain benefits hereinafter
described, shall cause to be paid to the Participant the following benefits:


 


(1)                               an
amount equal to three times the Participant’s highest Annual Compensation for
any calendar year beginning with or within the three-year period terminating on
the date of termination of the Participant’s employment, which amount shall be
paid to the Participant in cash on or before the fifth day following the date
of termination, subject to Section 8.2;


 


(2)                               for
a period of three years following the date of termination of employment, the
Participant and anyone entitled to claim under or through the Participant shall
be entitled to benefits as follows:


 


(i)                               For
U.S. Employees, all benefits under the group health care plan, dental care
plan, life or other insurance or death benefit plan, or other present or future
similar group employee benefit plan or program of the Company for which key
executives are eligible at the date of a Change of Control, to the same extent
as if the Participant had continued to be an employee of the Company during
such period and such benefits shall, to the extent not fully paid under any
such plan or program, be paid by the Company; and


 


(ii)                            for
French Employees, all medical and dental benefits provided by


 


8

















 


“Social Securite”, medical, dental and life insurance
or death benefit plans, or other present or future similar medical, dental,
life or other insurance or death benefit plans or programs generally available
to French Employees for which such Participant is eligible at the date of the
Change of Control, to the same extent as if the Participant had continued to be
a French Employee during such period and such benefits shall, to the extent not
fully paid under any such plan or program, be paid by the French Employer;


 


(iii)                           notwithstanding the foregoing, in the event that a Participant is or
may be liable for Federal income taxes in the United States, (A) during
such three-year period, the benefits provided (or the amounts paid by the Company
with respect to such benefits) in any one calendar year shall not affect the
amount of benefits (or amounts paid with respect to such benefits) provided in
any other calendar year; (B) the reimbursement of an eligible taxable
expense shall be made as soon as practicable but not later than December 31
of the year following the year in which the expense was incurred; and (C) the
Participant’s rights pursuant to this Section 4.1(c)(2) shall not be
subject to liquidation or exchange for another benefit.


 


(3)                                  for
a U.S. Employee, a lump sum payable in cash on or before the fifth day
following the date of termination, subject to Section 8.2, equal to:


 


(i)                                     for
a U.S. Employee Participant in the final average pay benefit formula under the
Retirement Plan an amount equal to the 


 


9

















 


Actuarial Equivalent
(as defined in the Retirement Plan) of the accrued benefit the Participant
would have earned under the Retirement Plan for the three-year period following
the date of termination of his employment with the Company based on the
Participant’s earnings in effect for purposes of the Retirement Plan on the
date of such termination.


 


(ii)                                  for
a U.S. Employee Participant in the cash balance benefit formula under the
Retirement Plan an amount equal to the actual dollar amount of the accrued
benefit the Participant would have earned under the Retirement Plan for the
three-year period following the date of termination of his employment with the
Company based on the Participant’s earnings in effect for purposes of the
Retirement Plan on the date of such termination.  Such amounts shall include any amounts
payable in the form of Excess Retirement Benefit contributions into the
Deferred Compensation Plan, as such term is defined in the Deferred
Compensation Plan.


 


(4)                                  for
French Employees, a lump sum equal to the sum of the following amounts which
sum shall be payable in cash on or before the tenth day following the date of
termination, subject to Section 8.2:


 


(i)                                     the
cost of purchasing any pension credits lost by a Participant under the Basic
Plan as a result of a Change of Control Termination, but in no event shall the
pension credits so purchased exceed 12 quarters of pension credits;


 


10

















 


(ii)                                  a
lump sum equal to (x) the purchase price of any pension credits lost by a
Participant under the Complementary Plan plus (y) the present value of any
portion of lost pension credits which may not be purchased back from the
Complementary Plan, each as a result of a Change of Control Termination provided, however,
that in no event shall such lost Complementary Plan benefits exceed the
present worth of three years of such lost pension benefits; and


 


(iii)                               for
pension benefits lost under the French Supplementary Plan as a result of a
Change of Control Termination, payment of a lump sum calculated as follows:


 


a)                                      if
the Participant is terminated between ages 62 and 65, a lump sum equal to the
present worth of the difference between the pension benefits the Participant
would have received at age 65 absent the Change of Control Termination and the
reduced pension benefit such Participant will receive at age 65 as a result of
such termination;


 


b)                                     if
the Participant is terminated between ages 60 and 62, payment of a lump sum as
calculated in (a) above multiplied by the ratio of A to B where A = three years
and B = the number of years between the Change of Control Termination and
attainment of age 65.


 


11

















 


c)                                      if
the Participant is terminated before age 60 or with less than 20 years service
with a French Employer, a lump sum equal to the present worth of the pension
benefit the Participant would have received at age 65, absent the Change of
Control Termination multiplied by the ratio of A to B where A = three years and
B = the number of years between the Change of Control Termination and the date
on which the Participant would attain age 65 provided, however, that
no such lump sum shall be payable unless such Participant could have earned 20
years service with a French Employer on or before attainment of age 65, absent
a Change of Control Termination.


 


d)                                           If
a Participant is or may be liable for Federal income taxes in the United
States, such Participant’s Agreement shall provide that the parties agree that
the payments provided in Section 4.1(a) hereof are reasonable
compensation in light of the Participant’s services rendered to the Company or
the French Employer, as the case may be, and that neither party shall contest
the payment of such benefits as constituting an “excess parachute payment”
within the meaning of Section 280G(b)(1) of the Code.


 


12

















 


e)                                      In
the event that (i) the Participant becomes entitled to the compensation
and benefits described in Section 4.1(a) hereof (“Compensation
Payments”), (ii) the Company determines, based upon the advice of tax
counsel selected by the Company’s independent auditors and acceptable to the
Participant, that, as a result of such Compensation Payments and any other
benefits or payments required to be taken into account under Code Section 280G(b)(2) (“Parachute
Payments”), any of such Parachute Payments must be reported by the Company as “excess
parachute payments”, and (iii) such Parachute Payments are 3.5 or more
times the “base amount” as defined in Code Section 280G(b)(3) with respect
to such Participant (“Base Amount”), the Company shall pay to the Participant
at the time specified in Section 4.1(a) above (and in no event later than December 31 of the year after the
year in which the related taxes are remitted to the applicable taxing
authorities) an additional amount (“Gross-Up Payment”) such that the net
amount retained by the Participant, after deduction of any of the tax imposed
on the Participant by Section 4999 of the Code (“Excise Tax”) and any
Federal, state and local income tax and Excise Tax upon the Gross-Up Payment,
shall be equal to the Parachute 


 


13

















 


Payments determined prior
to the application of this paragraph. 
The value of any non-cash benefits or any deferred payment or benefit
shall be determined by the Company’s independent auditors, or another
independent accounting firm selected by the Company.  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 termination of his employment, net of
the maximum reduction in Federal income taxes which could be obtained from
deduction of such state and local taxes. 
In the event that the Excise Tax payable by the Participant is
subsequently determined to be less than the amount, if any, taken into account
hereunder at the time of termination of the Participant’s employment, 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 plus interest on the amount of such
repayment at the rate provided for in Section 1274(b)(2)(B) of the Code 


 


14

















 


(“Repayment Amount”).  In the event that the Excise Tax payable by
the Participant is determined to exceed the amount, if any, taken into account
hereunder at the time of the termination of the Participant’s employment
(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 (plus any interest and
penalty payable with respect to such excess) immediately prior to the time that
the amount of such excess is required to be paid by Participant (regardless of
any contest of such payment pursuant to Section 4.1(e)) (“Additional
Gross-up Payment”), such that the net amount retained by the Participant, after
deduction of any Excise Tax on the Parachute Payments and any Federal, state
and local income tax and Excise Tax upon the Additional Gross-Up Payment, shall
be equal to the Parachute Payments determined prior to the application of this
paragraph. In the event that the Excise Tax payable by the Participant is
subsequently determined to be less than the amount of the Additional Gross-up
Payment paid to the participant, the Participant shall repay to the Company at
the time that the amount of such reduction in the Additional Gross-up 


 


15

















 


Payment is determined the
portion of the Additional Gross-up Payment attributable to such reduction plus
interest on the amount of such repayment at the rate provided for in Section 1274(h)(2)(B) of
the Code (“Additional Repayment Amount”). 
The obligation to pay any Repayment Amount, Additional Gross-up or
Additional Repayment Amount shall remain in effect under this Agreement for the
entire period during which the Participant remains liable for the Excise Tax,
including the period during which any applicable statute of limitation remains
open.


 


f)                                        In
the event the Participant’s Parachute Payments are less than 3.5 times the Base
Amount, the Company shall limit the Compensation Payments provided hereunder to
the extent necessary so that the Participant’s Parachute Payments do not exceed
2.99 times the Base Amount.  Such limitation of payments shall be
determined in such a manner as to maximize the economic present value of the
payments actually made to the Participant, determined by the the accounting
firm as of the date of the Change in Control using the discount rate required
by Section 280G(d)(4) of the Code.


 


16

















 


g)                                     Unless
the Company determines that any Parachute Payments made hereunder must be
reported as “excess parachute payments” in accordance with Section 4.1(c) above,
neither party shall file any return taking the position that the payment of
such benefits constitutes an “excess parachute payment” within the meaning of Section 280G(b)(1) of
the Code.  If the Internal Revenue
Service proposes an assessment of Excise Tax against the Participant in excess
of the amount, if any, taken into account at the time specified in Section 4.1(c) and
the Company notifies the Participant in writing that the Company elects to
contest such assessment at its own expense, the Participant shall cooperate in
good faith with the Company in contesting such proposed assessment and agrees
not to settle such contest without the written consent of the Company.  Any such contest shall be controlled by the
Company, provided, however, that the Participant shall have the right to
participate in such contest. 
Notwithstanding the Company’s election to contest the assessment of an
Excise Tax, the Participant shall be entitled to an Additional Gross-Up Payment
under Section 4.l(c) at the time set forth therein.


 


17

















 


4.2                                 Termination
of Employment.  If a Participant’s
employment with the Company or his French Employer shall terminate during the
term of his Agreement for any reason other than death, Retirement, Voluntary
Resignation or Cause, the Company or (if such payment is not inconsistent with
any relevant French law) his French Employer, shall pay the Participant or the
Participant’s beneficiary, as the case may be, in cash a lump sum payment in
the amount set forth in the Agreement with such Participant under this Plan
within 30 days of his termination of employment.  Such amount shall be set forth on Appendix A
hereto and shall not be more than the Participant’s monthly base salary
multiplied by 24.  No benefits shall be
payable pursuant to this Section 4.2 in the event a Participant is
entitled to severance payments under Section 4.1 hereof.


 


ARTICLE 5 -
ADMINISTRATION


 


5.1                                   Administrator.  The Administrator is responsible for the
general administration of the Plan.


 


5.2                                   Duties
of the Administrator.  The
Administrator shall be responsible for the daily administration of the Plan and
may appoint other persons or entities to perform or assist in the performance
of any of its duties, subject to its review and approval.  The Administrator shall have the right to
remove any such appointee from his position without cause upon notice.


 


5.3                                   Powers.  The Administrator shall administer the Plan
in accordance with its terms and shall have all powers necessary to carry out
the provisions of the Plan as more particularly set forth herein.  The Administrator shall have discretionary
authority to interpret the Plan, and to determine all questions arising in the
administration, interpretation, and application of the Plan; provided, however,
that such discretionary authority shall be exercised in good faith in order to 


 


18

















 


achieve the principal
purposes of the Plan to provide severance benefits, including enhanced
severance benefits upon a Change of Control, as described in Article 4.  All such determinations shall be conclusive
and binding on all interested persons. 
The Administrator shall adopt such procedures and regulations necessary
and/or desirable for the discharge of its duties hereunder and may appoint such
accountants, counsel, actuaries, specialists, and other agents as it deems
necessary and/or desirable in connection with the administration of this Plan.


 


5.4                                 Compensation
of the Administrator.  The
Administrator shall not receive any compensation from the Plan for its
services.


 


5.5                                 Indemnification.  The Company shall indemnify the Administrator
against any and all claims, losses, damages, expenses, and liability arising
from its actions or omissions, except when the same is finally adjudicated to
be due to the Administrator’s gross negligence or willful misconduct.  The Company may purchase at its own expense
sufficient liability insurance for the Administrator to cover any and all
claims, losses, damages, and expenses arising from any action or omission in
connection with the execution of the duties as the Administrator.


 


ARTICLE 6 - SUCCESSOR TO
THE COMPANY


 


6.1                                 The
Company will require any successor or assign (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of
the business and/or assets of the Company, expressly, absolutely and
unconditionally to assume this Plan and agree to perform the obligations of the
Company under this Plan and each Participant’s Agreement in the same manner and
to the same extent that the Company would be required to perform such
obligations if no such succession or assignment had taken place.


 


19

















 


ARTICLE 7 - MISCELLANEOUS


 


7.1                                    Funding
of Benefits.  The benefits payable to
a Participant under the Plan shall not be funded in any manner and shall be
paid by the Company or the French employer, as the case may be, out of its
general assets, which assets are subject to the claims of the Company’s or the
French Employer’s creditors.


 


7.2                                    Establishment
of Trust.


 


a)                                      The
Company may establish a Grantor Trust (“Trust”) for the Plan.  If established, all benefits payable under
this Plan to a Participant shall be paid directly by the Company from the
Trust.  To the extent that such benefits
are not paid from the Trust, the benefits shall be paid from the general assets
of the Company and shall be reimbursed to the Company by the Trust at the
Company’s request upon presentation of reasonable proof that the Company made
such payment.  Any Trust shall be an
irrevocable grantor trust which conforms the requirements of the model trust as
described in IRS Revenue Procedure 92-64, I.R.B. 1992-33.  The assets of the Trust are subject to the
claims of the Company’s creditors in the event of its insolvency.  Except as to any amounts paid or payable to a
Trust, the Company shall not be obligated to set aside, earmark or escrow any
funds or other assets to satisfy its obligations under this Plan, and the
Participant shall not have any property interest in any specific assets of the
Company other than the unsecured right to receive payments from the Company, as
provided in this Plan.


 


b)                                     Payment
From the Trust.  In the event a Trust is
established and payments are not made by the Company in accordance with the
terms of the Plan, a Participant may petition the trustee of the Trust directly
for payment and the trustee may make 


 


20

















 


such payment directly to the Participant upon the
trustee’s good faith determination that the payment was in fact owed, was not
timely paid by the Company and that there are sufficient assets in the Trust to
make the payment.


 


7.3                                    Settlement
of Accounts.  Except as prohibited by
applicable law, there shall be deducted from the payment of any benefit due
under the Plan the amount of any uncontested indebtedness, obligation, or
liability which the Participant has acknowledged in writing as owing to the
Company or the French Employer as the case may be, or any of their respective
subsidiaries and the amount of which has been agreed to by the Participant.


 


7.4                                    Withholding.  There shall be deducted from the payment of
any benefit due under the Plan the amount of any tax required by any
governmental authority to be withheld and paid over by the Company or the
French Employer, as the case may be, to such governmental authority for the
account of the Participant entitled to such payment.


 


7.5                                    Assignment
by the Participant.  Unless required
by court order, no Participant or beneficiary shall have any rights to sell,
assign, transfer, encumber, or otherwise convey the right to receive the
payment of any benefit due hereunder, which payment and the rights thereto are
expressly declared to be nonassignable and nontransferable.  Any attempt to do so shall be null and void
and of no effect.


 


7.6                                    Amendment
and Termination.  The Plan may be
amended or terminated at any time by the Company, by resolution of the Board;
provided that no termination or amendment reducing the severance benefits
provided hereunder shall be effective until the expiration of the two-year
period following the date of the Board resolution providing for such
termination.  Further, no amendment or
termination shall be effective during the two-year period following the date of
a Change of Control of the Company without the consent of all the
Participants.  Any 


 


21

















 


termination of this Plan
shall cause the immediate termination of all outstanding Agreements
hereunder.  No amendment or termination
shall affect the rights of any Participant who is entitled to severance
benefits pursuant to Article 4 at the time of such amendment or
termination.


 


7.7                                   No
Guarantee of Employment. 
Participation hereunder shall not be construed as creating any contract
of employment between the Company or a French Employer and any Key Employee,
nor shall it limit the right of the Company or such French Employer to
terminate a Key Employee’s employment at any time for any reason whatsoever.


 


7.8                                       Construction.  This Plan shall be construed in accordance
with and governed by the laws of the State of Georgia, to the extent such laws
are not otherwise superseded by the laws of the United States.


 


ARTICLE 8 — CODE SECTION
409A


 


8.1                                    Separation
from Service.  In the event that a Participant is or may be liable for Federal
income taxes in the United States, for
purposes of this Plan a termination of his or her employment shall be deemed to
occur only upon the Participant’s “separation from service,” as such term is
defined in Code Section 409A (without giving effect to any elective
provisions that may be available under such definition).


 


8.2                                    Additional Requirements Regarding Payments
and Benefits.  Notwithstanding anything
in this Plan to the contrary, in the event that a Participant is or may be
liable for Federal income taxes in the United States and if any amount or
benefit specified herein as “subject to Section 8.2” would be payable or
distributable under this Plan by reason of the Participant’s separation from
service at a time at which he is a Specified Employee (as defined below), then,
subject to any permissible acceleration of payment by Employer under Treas.
Reg. Section 1.409A-3(j)(4)(ii)


 


22

















 


(domestic
relations order), (j)(4)(iii) (conflicts of interest), or (j)(4)(vi) (payment
of employment taxes):


 


(a)                                  if the payment or distribution is payable in
a lump sum, the Participant’s right to receive payment or distribution of such
non-exempt deferred compensation will be delayed until the earlier of the
Participant’s death or the first day of the seventh month following the
Participant’s separation from service; and


 


(b)                                 if the payment or distribution is payable
over time, the amount of such non-exempt deferred compensation that would
otherwise be payable during the six-month period immediately following the
Participant’s separation from service will be accumulated and the Participant’s
right to receive payment or distribution of such accumulated amount will be
delayed until the earlier of the Participant’s death or the first day of the
seventh month following the Participant’s separation from service, whereupon
the accumulated amount will be paid or distributed to the Participant and the
normal payment or distribution schedule for any remaining payments or
distributions will resume.


 


8.2                                    Specified Employee.  For
purposes of this Plan, the term “Specified Employee” has the meaning given such
term in Code Section 409A and the final regulations thereunder (“Final
409A Regulations”), in accordance with rules adopted by the Board of
Directors or a committee thereof, which shall be applied consistently with
respect to all nonqualified deferred compensation arrangements of Employer,
including this Plan, as to the determination of Specified Employees.


 


23

















 


APPENDIX A


 


Participants in the 


Schweitzer-Mauduit International, Inc. 


Executive Severance Plan and Number of 


Months of Base Salary Pursuant to 


Section 4.2 of the Plan


 




	
   

  	
   

  	
  Number of Months of

  	
   

  
	
   

  	
   

  	
  Participant’s Base Salary in the

  	
   

  
	
   

  	
   

  	
  Event of Termination, Pursuant to

  	
   

  
	
  Name

  	
   

  	
  Section 4.2 of the Plan

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Chief Executive
  Officer

  	
   

  	
  24

  	
   

  
	
  Secretary and
  General Counsel

  	
   

  	
  12

  	
   

  
	
  Chief Operating
  Officer

  	
   

  	
  12

  	
   

  
	
  Chief Financial
  Officer and Treasurer

  	
   

  	
  12

  	
   

  
	
  President —
  European Operations

  	
   

  	
  12

  	
   

  
	
  President — the
  Americas

  	
   

  	
  12

  	
   

  
	
  Vice President -
  Administration

  	
   

  	
  12

  	
   

  
	
  Vice President
  Strategic Planning

  	
   

  	
  12

  	
   

  
	
  Controller

  	
   

  	
  6

  	
   

  






 


24