Document:

Exhibit 10.14.4

AMENDMENT NO. 3

 

 

                This
Amendment No. 3 dated as of January 27, 2005 (“Amendment”) is among
Schweitzer-Mauduit International, Inc., a Delaware corporation (“Company”),
Schweitzer-Mauduit France S.A.R.L., a French corporation (“SARL”, together with
the Company, the “Borrowers”), the banks party hereto (“Banks”) and Société
Générale, as agent for the Banks (“Agent”).

 

INTRODUCTION

 

                A.            The Borrowers, the Banks and the
Agent are party to the Credit Agreement dated as of January 31, 2002, as amended
by Amendment No. 1 dated as of January 30, 2003 and Amendment No. 2 dated as of
January 29, 2004 (the “Credit Agreement”).

 

                B.            The Borrowers have requested that
the Banks agree to (1) extend the Maturity Date of the Tranche A Commitments
under the Credit Agreement from January 27, 2005 to January 26, 2006, (2)
increase the aggregate amount of the Tranche A2 Commitments and reduce the
aggregate amount of the Tranche A1 Commitments and (3) make certain other
amendments to the Credit Agreement.

 

                THEREFORE,
the Borrowers, the Agent and the Banks hereby agree as follows:

 

Section
1.      Definitions; References.  Unless
otherwise defined in this Amendment, terms used in this Amendment that are
defined in the Credit Agreement shall have the meanings assigned to such terms
in the Credit Agreement.

Section 2.      Amendments.  Upon the satisfaction of the conditions
precedent set forth in Section 4 below, Section 1.01 of the Credit Agreement is
hereby amended as follows:

(a)           by deleting the date “January 27,
2005” in the definition of “Maturity Date” and replacing it with the date
“January 26, 2006”; and

(b)           by amending the definition of “Liquid
Investments” by amending in its entirety subsection (e) in as follows:

“(e) with respect to investments of amounts
arising from or used in the conduct of such Person’s business in Brazil,
Indonesia and the Philippines, bank debt securities issued by the following
banks:  Banco ABN AMRO Real S.A., Banco
do Brasil S.A., Banco Itau S.A., Banco Safra S.A., HSBC Bank Brasil S.A. Banco Multiplo,
Standard Chartered Bank, Pan Indonesia Bank, Bank of the Philippine Islands or
Equitable PCI Bank; provided that (i) such bank receives a long-term foreign
currency senior debt rating from either Standard & Poor’s Ratings Group or
Moody’s Investors Service and such rating is equal to or higher than B- (or the
then equivalent) (provided that (A) if the ratings established or deemed to
have been established by Standard & Poor’s Ratings Group and Moody’s
Investors Service for such bank shall differ, the lower of the two ratings
shall apply and (B) if neither Standard & Poor’s Ratings Group nor Moody’s
Investors Service shall have in effect a long-term foreign currency senior debt
rating for such bank, then Moody’s Investor Services’s long-term foreign
currency deposit rating, if any, shall be substituted therefor); (ii) the
aggregate of such investments may not exceed $10,000,000 (or the Dollar
Equivalent thereof); provided that the aggregate of such investments may not
exceed $5,000,000 (or the Dollar Equivalent thereof) in either Indonesia or the
Philippines; and (iii) such investments may be terminated without premium or
penalty within three Business Days.”

Section 3.       Increase
of the Tranche A2 Commitments; Reduction of the Tranche A1 Commitments.  As of the effective date of this Amendment,
the aggregate Tranche A2 Commitments shall be increased from 

 

 

$10,000,000 to
$15,000,000 and the Tranche A1 Commitments shall be reduced from €12,000,000 to
€8,000,000.  Upon the effectiveness of
this Agreement pursuant to Section 5 below, each Lender’s Tranche A1 Commitment
and Tranche A2 Commitment shall be the Tranche A1 Commitment and Tranche A2
Commitment set forth on the attached Schedule 1.  With respect to such reduction of the Tranche
A1 Commitments, the Agent and the Banks waive any requirement pursuant to
Section 2.04 that (a) the Borrowers provide at least fifteen Business Days’
irrevocable written notice to the Agent to terminate in whole or reduce ratably
in part the unused portion of the Commitments or (b) any partial reduction of
the Commitments shall be in the minimum aggregate amount of €5,000,0000 or an
integral multiple of €1,000,0000 in excess thereof.  This waiver is limited to the extent
described herein and shall not be construed to be a consent to or a waiver of
any other actions required by the Credit Agreement or any other Credit
Document.  The reduction of the Tranche
A1 Commitments pursuant to this Amendment shall be permanent, with no
obligation of the Banks to reinstate such Commitments.  The commitment fees provided for in Section
2.03 of the Credit Agreement shall hereafter be computed on the basis of the
Tranche A1 Commitments or Tranche A2 Commitments, as so increased or reduced,
as the case may be.

Section 4.       Representations and Warranties.  The Borrowers represent and warrant to the
Agent and the Banks as of the date hereof:

(a)           Any representations and warranties set forth in the
Credit Agreement and in the other Credit Documents (other than those made as of
a specific date) are true and correct in all material respects;

(b)           (i) The execution, delivery and performance of this
Amendment are within the corporate power and authority of the Borrowers and
have or will have been duly authorized by appropriate proceedings and (ii) this
Amendment constitutes a legal, valid, and binding obligation of the Borrowers
enforceable in accordance with its terms, except as limited by applicable
bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting
the rights of creditors generally and general principles of equity; and

(c)           No Default or Event of Default has
occurred and is continuing.

Section 5.       Effectiveness.  This Amendment shall become effective and the
Credit Agreement shall be amended as provided in Section 2 of this Amendment
when (a) the Agent shall have received this Amendment duly and validly executed
by the Borrowers, the Agent and the Banks and (b) the Borrower shall have paid
to the Agent for the ratable benefit of the Banks an amendment fee equal to
0.03% of the aggregate Commitments after giving effect to this Amendment.

Section
6.       Reaffirmation of Guaranty. 
The Company hereby reaffirms its obligations under Article VIII of the
Credit Agreement and agrees to remain liable for the repayment of the
Guaranteed Obligations (as defined therein), as such Guaranteed Obligations
have been amended hereby.

Section
7.       Choice of Law.  This
Amendment shall be governed by and interpreted in accordance with the laws of
the State of New York, without giving effect to the conflict of laws principles
thereof.

Section 8.       Counterparts.  This Amendment may be signed in any number of
counterparts, each of which shall be an original.

 

EXECUTED
as of the date first set forth above.

 

	
   

  	
  BORROWERS:

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHWEITZER-MAUDUIT
  INTERNATIONAL, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:  

  	
  /s/   WAYNE H. DEITRICH

  
	
   

  	
   

  	
          Wayne H. Deitrich

  
	
   

  	
   

  	
          Chairman and Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  SCHWEITZER-MAUDUIT FRANCE S.A.R.L.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:  

  	
  /s/   JEAN-PIERRE LE HETET

  
	
   

  	
   

  	
          Jean-Pierre Le Hetet

  
	
   

  	
   

  	
          Gerant (Manager)

  
	
   

  	
   

  	
   

  
	
   

  	
  AGENT:

  
	
   

  	
   

  	
   

  
	
   

  	
  SOCIETE GENERALE

  
	
   

  	
   

  	
   

  
	
   

  	
  By:  

  	
  /s/   MARC POUGET-ABADIE

  
	
   

  	
   

  	
          Marc Pouget-Abadie

  
	
   

  	
   

  	
          Director

  
	
   

  	
   

  	
   

  
	
   

  	
  BANKS:

  
	
   

  	
   

  	
   

  
	
   

  	
  SOCIETE GENERALE

  
	
   

  	
   

  	
   

  
	
   

  	
  By:  

  	
  /s/   MARC POUGET-ABADIE

  
	
   

  	
   

  	
          Marc Pouget-Abadie

  
	
   

  	
   

  	
          Director

  
	
   

  	
   

  	
   

  
	
   

  	
  BANQUE DE CHINE PARIS

  
	
   

  	
   

  	
   

  
	
   

  	
  By:  

  	
  /s/   M THEZE PIERRE

  
	
   

  	
   

  	
          M. Theze Pierre

  
	
   

  	
   

  	
          Co-Head of Corporate Banking
  Department

  
	
   

  	
   

  	
   

  
	
   

  	
  NATEXIS BANQUE
  POPULAIRES

  
	
   

  	
   

  	
   

  
	
   

  	
  By:  

  	
  /s/   HERVE MASSIAS

  
	
   

  	
   

  	
          Herve Massias

  
	
   

  	
   

  	
          Director Region Bretagne

  
	
   

  	
   

  	
   

  
	
   

  	
  By:  

  	
  /s/   HERVE BACHELOT

  
	
   

  	
   

  	
          Herve Bachelot

  
	
   

  	
   

  	
          Charge d’Affaires

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BNP - PARIBAS

  
	
   

  	
   

  	
   

  
	
   

  	
  By:  

  	
  /s/   JEAN-EUDES BLEHER

  
	
   

  	
   

  	
          Jean-Eudes Bleher

  
	
   

  	
   

  	
          Responsible Role Risque

  

 

 

	
   

  	
  By:  

  	
  /s/   NOSEF SAROURAULT

  
	
   

  	
   

  	
          Nosef Sarourault

  
	
   

  	
   

  	
          Responsible Commercial

  
	
   

  	
   

  	
   

  
	
   

  	
  CAISSE REGIONALE DE
  CREDIT

  
	
   

  	
  AGRICOLE MUTUEL DU
  FINISTERE

  
	
   

  	
   

  	
   

  
	
   

  	
  By:  

  	
  /s/   BERTRAUD ESPINASSOUS

  
	
   

  	
   

  	
          Bertrand Espinassous

  
	
   

  	
   

  	
          Director Agence Grands Entreprises

  
	
   

  	
   

  	
   

  
	
   

  	
  SUNTRUST BANK

  
	
   

  	
   

  	
   

  
	
   

  	
  By:  

  	
  /s/   BRADLEY J STAPLES

  
	
   

  	
   

  	
          Bradley J. Staples

  
	
   

  	
   

  	
          Director

  
	
   

  	
   

  	
   

  
	
   

  	
  CREDIT LYONNAIS

  
	
   

  	
   

  	
   

  
	
   

  	
  By:  

  	
  /s/   ERIC CORBISHER

  
	
   

  	
   

  	
          Eric Corbisher

  
	
   

  	
   

  	
          Director Regional Enterprises

  
	
   

  	
   

  	
   

  
	
   

  	
  CREDIT COMMERCIAL DE
  FRANCE

  
	
   

  	
   

  	
   

  
	
   

  	
  By:  

  	
  /s/   DE VASSELOT

  
	
   

  	
   

  	
          De Vasselot

  
	
   

  	
   

  	
          Branch ManagerExhibit 10.15

 

SCHWEITZER-MAUDUIT INTERNATIONAL, INC.

DEFERRED COMPENSATION PLAN NO. 2

FOR NON-EMPLOYEE DIRECTORS

 

Article I –
Purpose and Participation

 

The purpose of the Schweitzer-Mauduit International, Inc. Deferred
Compensation Plan No. 2 for Non-Employee Directors (“Plan”) is to enhance the
ability of Schweitzer-Mauduit International, Inc. (“SWM”) to attract and retain
as members of its Board of Directors (“Board”) individuals of outstanding
competence.

 

Article II –
Definitions

 

As used within this document, the following words and phrases have the
meanings described in this Article II unless a different meaning is
required by the context.  Some of the
words and phrases used in the Plan are not defined in this Article II, but
for convenience, are defined as they are introduced into the text.  Words in the masculine gender shall be deemed
to include the feminine gender.  Any
headings used are included for ease of reference only, and are not to be
construed so as to alter any of the terms of the Plan.

 

2.1                                 Annual
Deferral.  The amount of the annual
retainer or meeting fees which the Director elects to defer in each Deferral
Period pursuant to Article 3.2 of the Plan.

 

2.2                                 Beneficiary.  An individual or entity designated by a
Participant in accordance with Article 8.11.

 

2.3                                 Board
or Board of Directors.  The Board of
Directors of the Corporation.

 

2.4                                 Change
of Control.  For the purposes of this
Plan, a 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 Act of 1934, acquires
actual or beneficial ownership of shares of the Corporation having 15% or more
of the total number of votes that may be cast for

 

 

the
election of Directors of the Corporation; 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 were Directors of the Corporation before the Transaction shall
cease to constitute a majority of the Board of Directors of the Corporation or
any successor to the Corporation.

 

Notwithstanding the foregoing, in the event that the regulations of the
Secretary of the Treasury defining a “change in the ownership or effective
control of the corporation, or in the ownership of a substantial portion of the
assets of the corporation,” for purposes of Section 409A of the Code, are
more restrictive than the foregoing definition, then the definition in the
Treasury Regulations shall be substituted for the foregoing definition of
Change of Control.

 

2.5                                 Code.  The Internal Revenue Code of 1986.  Reference to a section of the Code shall
include that section and any comparable section or sections of any
future legislation that amends, supplements or supersedes such section.

 

2.6                                 Committee.  The Compensation Committee of the Corporation’s
Board of Directors.

 

2.7                                 Corporation.  Schweitzer-Mauduit International, Inc.

 

2.8                                 Deferral
Accounts.  The Stock Unit Account and
the Investment Account established for each Director participating in this Plan
pursuant to Sections 4.2 and 4.3, respectively, of the Plan.

 

2.9                                 Deferral
Election.  The election made by the
Director pursuant to Article 3.2 of the Plan.

 

2.10                           Deferral
Period.  The Plan Year, or in the
case of a new Director elected during a Plan Year, the remaining portion of the
Plan Year.  In the case of the first Plan
Year, the Deferral Period commences January 1, 2005 and ends December 31,
2005.

 

2

 

2.11                           Disability.  A Director shall be considered to have
experienced a “Disability” or to be disabled, for purposes of this Plan, if the
Director (i) is unable to engage in any substantial gainful activity by reason
of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period
of not less than 12 months, or (ii) is, by reason of any medically determinable
physical or mental impairment which can be expected to result in death or can
be expected to last for a continuous period of not less than 12 months,
receiving income replacement benefits for a period of not less than 3 months
under an accident and health plan covering employees of the Corporation.

 

2.12                           Effective
Date.  January 1, 2005.

 

2.13                           Fair
Market Value.  Shall have the meaning
given to such term in Article 4.2.

 

2.14                           IRS.  The Internal Revenue Service.

 

2.15                           Plan.  The Schweitzer-Mauduit International, Inc.
Deferred Compensation Plan No. 2 for Non-Employee Directors.

 

2.16                           Plan
Administrator.  The Corporation’s
Board of Directors or a committee thereof as appointed by the Board from time
to time.

 

2.17                           Plan
Year.  “Plan Year” means the 12-month
period beginning each January 1 and ending on the following December 31.

 

2.18                           Rabbi
Trust.  The trust which the
Corporation, as grantor, may establish, in its discretion, as a trust intended
to qualify under subpart E, part I, Subchapter J, chapter 1, Subtitle A of
the Code as a grantor trust for the Plan.

 

2.19                           Valuation
Date.  Shall have the meanings, as
applicable, given to such term in Sections 5.1, 5.2, 5.3 and 5.4.

 

3

 

Article III –
Eligibility and Participation

 

3.1                                 Non-employee
members of the Board (“Directors”) may elect to defer receipt of all or any
portion of earned Director’s annual retainer fees paid in SWM common stock
pursuant to the Schweitzer-Mauduit International, Inc. Outside Director Stock
Plan into a stock unit account (the “Stock Unit Account”) and Board and
committee meeting fees, established by resolution of the Board from time to
time and other amounts paid to Directors in cash by the Corporation, into an
Investment Account (the “Investment Account”)(collectively, the retainer fees,
Board and committee meeting fees and other sums are called “Director’s
Compensation” herein).  One-quarter of a
Director’s annual retainer fee shall be deemed earned on the first business day
of each calendar quarter and all Board and committee meeting fees shall be
deemed earned on the last business day of the calendar month in which the
meeting is attended by the Director.

 

3.2                                 A
Director must submit a Deferral Election Form to SWM’s Vice
President-Administration by December 15 indicating deferrals elected for
the following Plan Year.

 

3.3                                 If
any individual initially becomes a Director during a Plan Year, he or she may
elect to defer Director’s Compensation to be earned during that Plan Year
before attendance at the first Board or committee meeting following election to
the Board (and in all events no later than 30 days after election to the
Board).

 

Article IV –
Deferred Compensation Accounts

 

4.1                                 For
record-keeping purposes only, SWM shall maintain a Stock Unit Account and an
Investment Account.

 

4.2                                 Stock
Unit Account.   The Stock Unit
Account shall consist of fictional shares (“Stock Units”) of SWM par value
$0.10 common stock (“Common Stock”) accumulated and accounted for the sole
purpose of determining the pay out in shares of Common Stock or the cash
equivalent upon any distribution of benefits under this portion of a Director’s
deferred compensation.

 

4

 

4.2.1                        One
quarter of the Director’s deferred annual retainer fee will be credited to the
Stock Unit Account on the first trading day on the New York Stock Exchange (“Trading
Day”) of each calendar quarter during the Plan Year to the hypothetical
purchase of whole or fractional shares of Common Stock on that day.

 

4.2.2                        For
purposes of determining the number of whole or fractional shares of Common
Stock which shall be credited to the Stock Unit Account, the hypothetical
purchase shall be deemed to be made at Fair Market Value on the date of the
hypothetical purchase.  For purposes of Article 4.2,
Fair Market Value shall be the mean between the high and low sales prices of
the Common Stock, on the relevant date as reported on the composite list used
by the Wall Street Journal for reporting stock prices, or if no such trading in
the Common Stock shall have taken place on that day, on the last preceding day
on which there was such trading in the Common Stock.

 

4.2.3                        The
equivalent of any cash dividends paid with respect to the shares of Common
Stock shall be applied on the last business day of the month in which such
dividends are paid, based on the hypothetical number of shares of Common Stock
in the Stock Unit Account as of the record date for such dividend, to the
hypothetical purchase of whole or fractional shares of Common Stock at Fair
Market Value and credited to the Stock Unit Account.

 

4.2.4                        In the
event SWM pays a stock dividend or reclassifies or divides or combines its
outstanding Common Stock then an appropriate adjustment shall be made in the
hypothetical number of shares of Common Stock held in the Stock Unit Account.

 

4.3                                 Investment
Account – As of the end of each calendar month in which a Director would be
entitled to payment of Board or committee meeting fees, SWM shall credit to the
Investment Account the amount of such meeting fees that were deferred by the
Director in the Deferral Election Form submitted for the applicable Plan Year.

 

5

 

4.3.1                        Any
distribution of benefits from an Investment Account shall be charged to that
account as of the date such payment is made by SWM or by the trustee of any
Rabbi Trust established by the Corporation for the Plan.

 

4.4                                 Earnings
and Losses on the Investment Account – The Investment Account balance shall
be credited or debited, as the case may be, with deemed net income, gain and
loss, including the deemed net unrealized gain and loss based on hypothetical
investment directions made by the Participant with respect to the Investment
Account on the Deferral Election Form, in accordance with investment options and
procedures adopted by the Plan Administrator in its sole discretion, from time
to time.

 

4.5                                 Hypothetical
Nature of Accounts – The Plan constitutes an unsecured promise by SWM to
make the benefit distributions in the future in the amount of the cash account
balance in the Investment Account, after adjustment for gains or losses, and
for the number of whole or fractional shares of Common Stock in the Stock Unit
Account.  Any Deferral Account
established for a Director under this Plan shall be hypothetical in nature and
shall be maintained solely for the Corporation’s record-keeping purposes so
that any contributions can be credited and deemed investment earnings and
losses on such amounts can be credited (or debited, as the case may be).  Neither the Plan, the Investment Accounts (or
subaccounts) nor the Stock Unit Account shall hold any actual funds or assets.

 

4.5.1                        The right
of any individual or entity to receive one or more payments or distributions of
shares of Common Stock under the Plan shall be an unsecured claim against the
general assets of the Corporation.  Any
liability of the Corporation to any Director, former Director, or Beneficiary
with respect to a right to payment or distribution shall be based solely upon
contractual obligations created by the Plan. 
The Corporation, the Board of Directors, the Committee, the Plan
Administrator and any individual or entity shall not be deemed to be a trustee
of any amounts to be paid or shares of Common Stock to be distributed under the
Plan.  Nothing contained in the Plan, and
no action taken pursuant to its provisions, shall create or be construed to
create a trust of any kind, or a

 

6

 

fiduciary
relationship, between the Corporation and a Director, former Director,
Beneficiary, or any other individual or entity.

 

4.5.2                        The
Corporation may, in its sole discretion, establish a Rabbi Trust as a vehicle
in which to place funds or shares of Common Stock with respect to this
Plan.  If established, all benefits payable
under this Plan to a Director shall be paid directly by the Corporation from
the Rabbi Trust.  To the extent that such
benefits are not paid from the Rabbi Trust, the benefits shall be paid from the
general assets of the Corporation and shall be reimbursed to the Corporation by
the Rabbi Trust at the Corporation’s request upon presentation of reasonable
proof that the Corporation made such payment. 
The assets of the Rabbi Trust shall be 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
Rabbi 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
Directors shall not have any property interest in any specific assets of the
Corporation other than the unsecured right to receive payments from the
Corporation, as provided in this Plan.

 

4.5.3                        The
Corporation does not in any way guarantee any Director’s Investment Account
against loss or depreciation, whether caused by poor investment performance,
insolvency of a deemed investment or by any other event or occurrence.  In no event shall any employee, officer,
director, or stockholder of the Corporation be liable to any individual or
entity on account of any claim arising by reason of the Plan provisions or any
instrument or instruments implementing its provisions, or for the failure of
any Director, Beneficiary or other individual or entity to be entitled to any
particular tax consequences with respect to the Plan or any credit or payment
of benefits thereunder.

 

Article V –
Benefits

 

5.1                                 Disability.  If a Director suffers a Disability while
serving as a Director of the Corporation and before he is entitled to benefits
under this Plan, he shall receive the

 

7

 

number
of shares of Common Stock and the cash amount credited to his Deferral Accounts
as of the Valuation Date, which for purposes of this Article 5.1 shall be
the date on which the Director is determined by the Committee to have suffered
a Disability.  No further investment
gains or losses shall be credited or debited against the Investment Account as
of and after the Valuation Date. 
Dividends shall continue to be paid on shares of Common Stock in the
Stock Unit Account and credited to that account in whole or fractional shares
of Common Stock in accordance with the Plan terms.  Distribution of benefits from the Deferral
Accounts under this Article shall commence within thirty (30) days after
the date on which the Committee determines the existence of the Director’s
Disability and in accordance with the payment method elected by the Director on
his Deferral Election Form.

 

5.2                                 Pre-Termination
Survivor Benefit.  If a Director dies
before becoming entitled to benefits under this Article, the Beneficiary or
Beneficiaries designated pursuant to Article 8.11 shall receive the cash
amount and a distribution of the number of shares of Common Stock credited to
the Director’s Deferral Accounts as of the Valuation Date, which for purposes
of this Article 5.2 shall be the date the Director died or the first
business day thereafter if such date falls on a holiday or a weekend. No
further investment gains or losses shall be credited or debited against the Investment
Account as of and after the Valuation Date. 
Dividends shall continue to be paid on shares of Common Stock in the
Stock Unit Account and credited to that account in whole or fractional shares
of Common Stock in accordance with the Plan terms. Distribution of any benefits
under this Article shall be made within thirty (30) days after the
Director’s death, or if later, within thirty (30) days after the date on which
the Plan Administrator receives notification of or otherwise confirms the
Director’s death.

 

5.3                                 Post-Termination
Survivor Benefit.  If a Director dies
after benefits have commenced, but prior to receiving complete payment of
benefits under this Plan, the Beneficiary or Beneficiaries designated under Article 8.11,
shall receive in a single lump sum the cash amount and a distribution of the
number of shares of Common Stock credited to the Director’s Deferral Accounts
as of the Valuation Date determined in accordance with Article 5.2.  No further investment gains or losses shall
be credited or

 

8

 

debited
against the Investment Account as of and after the Valuation Date.  Dividends shall continue to be paid on shares
of Common Stock in the Stock Unit Account and credited to that account in whole
or fractional shares of Common Stock in accordance with the Plan terms.  Distribution of any benefits under this Article shall
be made within thirty (30) days after the Director’s death, or if later, within
thirty (30) days after the date on which the Plan Administrator receives
notification of or otherwise confirms the Director’s death.

 

5.4                                 Change
of Control.  If a Change of Control
occurs before a Director becomes entitled to receive benefits by reason of any
of the above Articles or before the Director has received complete payment of
his benefits under this Plan, he shall receive a lump sum payment of the cash
amount and a distribution of the shares of Common Stock credited to his
Deferral Accounts as of the Valuation Date which for purposes of this Article 5.4
shall mean the business day immediately preceding the date on which the Company
receives notice of facts indicating that a Change of Control occurred.  No further investment gains or losses shall
be credited or debited against the Investment Account as of and after the
Valuation Date.  Dividends shall continue
to be paid on shares of Common Stock in the Stock Unit Account and credited to
that account in whole or fractional shares of Common Stock in accordance with
the Plan terms. Distribution of any benefits under this Article shall
commence within thirty (30) days after the Valuation Date.

 

Article VI –
Benefit Distributions

 

6.1                                 Distributions
from either the Stock Unit Account or the Investment Account or transfers
between the two accounts shall not be allowed while the individual remains a
Director of SWM.

 

6.2                                 At
the time of filing a Deferral Election Form, a Director must indicate an
election to receive distribution of: (1) the entire amount in the
Investment Account and a distribution of all shares of Common Stock in the
Stock Unit Account immediately following the end of the month in which the
participant is no longer a Director, (2) the entire balance in the
Investment Account and the Stock Unit Account in five (5) or ten

 

9

 

(10)
annual installments with the initial distribution made in the following
January.  If no distribution election is
made by the Director or no election form is in effect at the time a participant
is no longer a Director, the balance of cash and shares of Common Stock in such
Director’s Deferral Accounts will be distributed in installments over five
years.  Annual installments shall be
calculated each year by dividing the remaining Investment Account balance and
the number of shares of Common Stock remaining in the Stock Unit Account as of January 1
of that year by the remaining number of installments.  Any Deferral Election may be amended provided
that all of the following requirements are met:

 

(i)                                     the
amendment of the Deferral Election shall not take effect until at least 12
months after the date on which such amendment is made;

 

(ii)                                  in
the case of an amendment of a Deferral Election related to a payment not made
on account of the Participant’s death or Disability, the first payment with
respect to which the amendment is made shall in all cases be deferred for a
period of not less then 5 years from the date on which such payment otherwise
would have been made;

 

(iii)                               in
the case of an amendment of an election related to a payment that is to be made
at a specified time or pursuant to a fixed schedule, such an amendment of the
election must be made at least 12 months prior to the date of the first
scheduled payment.

 

6.3                                 If
the Director or former Director dies before all payments have been made,
distribution(s) shall be made to the beneficiary designated by the Director in
the Deferral Election Form.  The
designated beneficiary may be changed from time to time by delivering a new
Beneficiary designation in writing to SWM’s Vice President -
Administration.  If no designation is
made, or if the named beneficiary predeceases the Director, distributions of
benefits shall be made to the Director’s estate.

 

10

 

Article VII – Establishment of
Trust

 

7.1                                 Establishment
of Trust.  The Corporation may
establish a Rabbi Trust (“Trust”) for the Plan. 
If established, all benefits payable under this Plan to a Director shall
be paid directly by the Corporation 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
Corporation and shall be reimbursed to the Corporation by the Trust at the
Corporation’s request upon presentation of reasonable proof that the
Corporation made such payment.  Any Trust
shall be an irrevocable grantor trust which is intended to qualify as such
under subpart E, part I, Subchapter J, chapter 1, Subtitle A of the Code. The
assets of the Rabbi Trust are subject to the claims of the Corporation’s creditors
in the event of its insolvency.  Except
as to any amounts paid or payable to a Trust, the Corporation shall not be
obligated to set aside, earmark or escrow any funds or other assets to satisfy
its obligations under this Plan, and the Director and/or his designated
Beneficiaries shall not have any property interest in any specific assets of
the Corporation other than the unsecured right to receive payments from the
Corporation, as provided in this Plan.

 

7.2                                 Distribution
of Benefits from the Trust.  In the
event a Trust is established and benefit distributions are not made by the
Corporation in accordance with the terms of the Plan, a Director may petition
the trustee of the Trust directly for distribution of benefits and the trustee
may make such distributions directly to the Director upon the trustee’s good
faith determination that the benefit distribution was in fact owed, was not
timely made by the Corporation and that there are sufficient assets in the
Trust to make the distribution.

 

Article VIII – Miscellaneous

 

8.1                                 Benefits
provided under this Plan are unfunded obligations of the Corporation.  Nothing contained in this Plan shall require
the Corporation to segregate any monies or other assets from its general funds
or assets with respect to such obligations. 
This Plan is not an employee benefit plan as defined in the Employee
Retirement Income Security

 

11

 

Act of
1974, as amended, and is not intended for the benefit of any common law
employee of the Corporation.

 

8.2                                 The
Board shall be the plan administrator of this Plan and shall be solely
responsible for its general administration and interpretation and for carrying
out the provisions hereof, and shall have all such powers as may be necessary to
do so.  The Board shall have the right to
delegate from time to time the administration of the Plan, in whole or in part,
to any committee of the Board.  The
decisions made, and the actions taken, by the Board or any committee thereof in
the administration of the Plan shall be final and conclusive on all persons,
and no member of the Board or any committee thereof shall be subject to
individual liability with respect to the Plan.

 

8.3                                 Neither
the Director nor any beneficiary nor any next-of-kin shall have the right to
assign or otherwise alienate the right to receive payments hereunder, in whole
or in part, which payments are expressly non-assignable and non-transferable,
whether voluntarily or involuntarily. 
Any attempt to alienate, sell, transfer, assign, pledge or otherwise
encumber any such amount, whether presently or thereafter payable, shall be
void.  Except as required by law, no
benefit payable under this Plan shall in any manner be subject to garnishment, attachment,
execution or other legal process, or be liable for or subject to the debts or
liability of any Director.

 

8.4                                 The
Corporation shall withhold from amounts paid under this Plan any taxes or other
amounts required to be withheld by law. 
The Corporation shall comply with all governmental reporting
requirements applicable to the Plan or any payment pursuant to the Plan.

 

8.5                                 The
Board, may at any time, amend the Plan for whatever reasons it may deem
appropriate.  No amendment shall
(a) impair the rights of a participant with respect to amounts then in the
participant’s account of (b) be effective without the written consent of
the Directors.  All references to action
by the Directors shall mean a vote of a majority of the total number of
Directors authorized by the Board unless such action may potentially result in
the loss of deferred tax treatment of the plan benefits, in which case the
unanimous vote of the Board shall be required.

 

12

 

8.6                                 Each
Director in the Plan will receive a quarterly statement indicating the dollar
amount credited to the participant’s Investment Account and the number of
shares of Common Stock in the Unit Stock Account as of the end of the preceding
calendar quarter.

 

8.7                                 This
Plan shall become effective with respect to annual retainer and meeting fees
earned on and after January 1, 2005 with all elections and designations
filed by the Directors prior to January 1, 2005 pursuant to this Plan
becoming effective as of such date.

 

8.8                                 Good
Faith Distribution of Benefits.  Any
distribution of benefits made in good faith in accordance with provisions of
the Plan shall be a complete discharge of any liability for the making of such
payment under the provisions of this Plan.

 

8.9                                 Binding
Effect.  The provisions of this Plan
shall be binding upon the Corporation and its successors and assigns and upon
every Director and his heirs, Beneficiaries, estates and legal representatives.

 

8.10                           Director
Change of Address.  Each Director
entitled to benefits shall file with the Corporation’s Vice President -
Administration, in writing, any change of address.  Any check representing payment and any
communication addressed to a Director or a former Director at this last address
filed with the Corporation’s Vice President - Administration, or if no such
address has been filed, then at his last address as indicated on the
Corporation’s records, shall be binding on such Director for all purposes of
the Plan, and neither the Plan Administrator, the Corporation, any trustee, nor
any other payor shall be obliged to search for or ascertain the location of any
such Director.  If the Plan Administrator
is in doubt as to the address of any Director entitled to benefits or as to
whether benefit payments are being received by a Director, it shall, by registered
mail addressed to such Director at his last known address, notify such Director
that:

 

13

 

(i)                                     All
unmailed and future Plan payments shall be withheld until Director provides the
Plan Administrator with evidence of such Director’s continued life and proper
mailing address; and

 

(ii)                                  Director’s
right to any Plan payment shall, at the option of the Committee, be canceled
forever, if, at the expiration of five (5) years from the date of such mailing,
such Director or his Beneficiary shall not have provided the Committee with
evidence of his continued life and proper mailing address.

 

8.11                           Designation
of Beneficiary.  Each Director shall
designate, by name, on the Deferral Election Form, the Beneficiary(ies) who
shall receive any benefits which might be payable after such Director’s
death.  A Beneficiary designation may be
changed or revoked in writing by the Director making the designation without
such Beneficiary’s consent at any time or from time to time in the manner as
provided by the Plan Administrator, and the Plan Administrator shall have no
duty to notify any individual or entity designated as a Beneficiary of any
change in such designation which might affect such individual or entity’s
present or future rights.  If the
designated Beneficiary does not survive the Director, all amounts that would
have been paid to such deceased Beneficiary shall be paid to the Director or to
his estate.

 

8.11.1  No Director shall designate more than three
(3) simultaneous Beneficiaries, and if more than one (1) Beneficiary is named,
Director shall designate the share to be received by each Beneficiary.  Despite the limitation of three (3)
Beneficiaries, a Director may designate more than three (3) Beneficiaries
provided such beneficiaries are the surviving spouse and children of the
Director.  If a Director designates
alternative, successor, or contingent Beneficiaries, such Director shall
specify the shares, terms and conditions upon which amounts shall be paid or
shares of Common Stock distributed to such multiple, alternative, successor or
contingent beneficiaries.  Any payment
made under this Plan or distribution of shares of Common Stock after the death
of a Participant shall be made only to the Beneficiary or Beneficiaries
designated pursuant to this Section.

 

14

 

8.12                           Claims.  Any claim for benefits must initially be
submitted in writing to the Corporation’s Vice President - Administration.  If such claim is denied (in whole or in
part), the claimant shall receive notice from the Plan Administrator, in
writing, setting forth the specific reasons for denial, with specific reference
to applicable provisions of this Plan. 
Such notice shall be provided within ninety (90) days after the date on
which the claim for benefits is received by the Corporation’s Vice President -
Administration, unless special circumstances require an extension of time for
processing the claim, in which event notification of the extension shall be provided
to the claimant prior to the expiration of the initial 90-day period.  The extension notification shall indicate the
special circumstances requiring the extension of time and the date by which the
Plan Administrator expects to render its decision.  Any such extension shall not exceed 90
days.  Any disagreements about such
interpretations and construction may be appealed in writing by the claimant to
the Plan Administrator within sixty (60) days after the date on which the
claimant receives the notice with respect to the claim denial.  The Plan Administrator shall respond to such
appeal within sixty (60) days, with a notice in writing fully disclosing its
decision and its reasons, unless special circumstances require an extension of
time for reviewing the claim, in which event notification of the extension
shall be provided to the claimant prior to the expiration of the initial sixty
(60) day period.  Any such extension
shall be provided to the claimant prior to the commencement of the
extension.  Any such extension shall not
exceed 60 days.  No member of the Board,
or any committee thereof, and no officer, employee or agent of the Corporation
shall be liable to any individual or entity for any action taken hereunder,
except those actions undertaken with lack of good faith.

 

8.12.1  Provided that the Corporation has established
a Rabbi Trust for the Plan pursuant to which the trustee has agreed to act in a
capacity other than as a directed trustee in the event of a Change in Control,
the trustee of the Trust shall perform the duties of the Plan Administrator
under this Article 8.12 following a Change of Control.

 

15

 

8.13                           Nothing
contained in the Plan shall be construed as a commitment by the Board to
nominate any person for election or re-election to the Board.  Nothing contained in this Plan shall be
construed to create a right in any person to be elected or to continue to serve
as a Director.

 

8.14                           The
adoption of this Plan shall have no effect on the existing Schweitzer-Mauduit
International, Inc. Outside Directors Stock Plan.  Nothing contained in this Plan shall prevent
SWM from adopting other or additional compensation plans or arrangements for
its non-employee Directors.

 

8.15                           Governing
Law.  To the extent not superseded by
the laws of the United States, the laws of the State of Georgia (except for the
provisions of Georgia law relating to conflicts of laws) shall be controlling
in all matters relating to this Plan.

 

8.16                           Severability.  In the event any provision of this Plan shall
be held illegal or invalid for any reason, such illegality or invalidity shall
not affect the remaining provisions of the Plan, and the Plan shall be
interpreted and enforced as if such illegal and invalid provisions had never been
set forth.

 

IN WITNESS WHEREOF, Schweitzer-Mauduit International, Inc. has adopted
the foregoing instrument effective as of January 1, 2005.

 

 

	
   

  	
  SCHWEITZER-MAUDUIT INTERNATIONAL, INC. 

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William R. Foust

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Vice President - Administration

  	
   

  

 

16

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