Document:

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

2

 

	 	 	 	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.

3

 

(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

4

 

	 	 	 	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.

5

 

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.

6

 

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

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

7Exhibit 10.26

 

EXHIBIT
10.26

DEFERRED SHARE UNIT PLAN

(Stock plan for non-employee directors)

DATED MARCH 11, 1998

	1.	 	Purpose: The Abitibi-Consolidated Inc. Stock Plan for Non-Employee Directors (the
“Plan”) is intended to enhance the Company’s ability to attract and retain talented
individuals to serve as members of the Board and to promote a greater alignment of
interests between non-employee members of the Board and the shareholders of the
Company. All Eligible Directors are eligible to participate in the Plan and enjoy
the benefits of the Plan as set out below upon the Effective Date or, for Eligible
Directors elected or appointed to the Board after the Effective Date, on the date of
his or her election or appointment.
	 
	2.	 	Definitions: As used in the Plan, the following terms have the respective meanings:

	 	(a)	 	“Board” means the Board, of Directors of the Company.
	 
	 	(b)	 	‘Committee” means the Human Resources and Compensation Committee of the
Board, or such other persons designated by the Board.
	 
	 	(c)	 	“Common Share” means a common share without nominal or par value of the
Company.
	 
	 	(d)	 	“Common Share Award” means an award of Common Shares under the Plan.
	 
	 	(e)	 	“Company” means Abitibi-Consolidated Inc.
	 
	 	(f)	 	“Deferred Share Unit’ means a bookkeeping entry, equivalent in value to
a Common Share, credited in accordance with an election made by an Eligible
Director pursuant to Section 5 or Section 6.
	 
	 	(g)	 	“Effective Date” shall mean the effective date of the Plan -set out in Section 3.
	 
	 	(h)	 	“Election Date” means the date on which an Eligible Director files
an election with the Corporate Secretary of the Company pursuant to
Section 5(a).
	 
	 	(i)	 	“Eligible Director” means any director who is -neither an employee
nor a full-time officer of the Company or any affiliate or subsidiary of
the Company on the applicable Election Date.
	 
	 	(j)	 	“Fair Market Value” on a particular date means the average of the
closing prices of the Common Shares as reported on the principal Canadian
securities exchange on which such shares are listed or admitted to trading
during the last five days on which the Common Shares traded ending
on such particular date or, if the Common Shares

 

 

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	 	 	 	are not so listed or traded, the five day simple average of the mean between the
closing bid price and the closing asked price as quoted on the National Association
of Securities Dealers Automated Quotation System on each date within that five day
period, or such other market in which such prices are regularly quoted, or, if there
have been no published bid or asked quotations with respect to the Common Shares, the
Fair Market Value shall be the value on that date established by the Committee in
good faith.
	 
	 	(k)	 	“Plan” means the Abitibi-Consolidated Stock Plan for Non-Employee Directors.
	 
	 	(I)	 	“Purchase Date” shall be, unless otherwise determined by the Committee, the
last day of March, June, September and December.
	 
	 	(m)	 	“Termination” means the date on which an Eligible Director terminates Board
service by reason of his or her death, retirement from, or loss of office as a
director of the Board.

	3.	 	Effective Date: The Plan shall be effective on a date to be determined by the Committee,
provided that an election pursuant to Sections 5 and 6 hereof may apply to all amounts earned
during the year that the Plan becomes effective.
	 
	4.	 	Administration: The Plan shall be administered by the Committee, which may delegate its
duties and powers in whole or in part to any subcommittee thereof consisting solely of at
least two “Eligible Directors’. The Committee is authorized to interpret, construe and
administer the Plan, to establish, amend and rescind any rules and regulations relating to the
Plan, and to make any other determinations that it deems necessary or desirable for the
administration of the Plan. The Committee may correct any defect or supply any omission or
reconcile any- inconsistency in the Plan in the manner and to the extent the Committee deems
necessary or- desirable. Any decision of the Committee in the interpretation, construction and
administration of the Plan, or any action, all as described herein, shall lie within its sole
and absolute discretion and shall be final, conclusive and binding on all parties concerned
for all purposes. Neither the Committee or any member thereof, nor any officer or employee of
the Company, shall be liable for any act, omission, interpretation, construction or
determination made in good faith ‘m connection with the Plan, and the members of the Committee
and the officers and employees of the Company shall be entitled to indemnification by
the Company in respect of any claim, loss, damage or expense (including legal fees -and
disbursements) arising therefrom to the fullest extent permitted by law. The expenses of
administering the Plan shall be borne by the Company.
	 
	5.	 	Payment and Deferral of ALL or a Portion of Annual Retainer: Each Eligible Director may
receive all or a portion of his or her annual retainer in the form of Deferred Share Units.

	 	(a)	 	Method of Electing: The Eligible Director must complete and deliver to the
Corporate Secretary of the Company an annual written election designating the portion
of his or her annual retainer that is to be paid in Deferred Share Units as follows:

	 	(i)	 	for Eligible Directors in office on the Effective
Date, the election for 1998 shall be delivered within 30 days after the
Effective Date;

 

 

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	 	(ii)	 	for Eligible Directors not in office on the Effective Date, the
election for 1998 shall be delivered within 30 days after the Eligible
Director is elected or appointed as a director of the Company; and
	 
	 	(iii)	 	in respect of any subsequent year,- the election shall
be made at least 30 days prior to the commencement of that year (unless an
Eligible Director takes office during that year in which case the election
shall be made within 30 days after the Eligible Director is elected or
appointed as a director).

	 	 	 	An election made in accordance with the foregoing shall be effective for the year
or balance thereof, in respect of which it is made. An election may be revoked or
changed only with respect to the period in the year for which Deferred Share Units
have not yet been credited.
	 
	 		 	-If no election is made, the Eligible Director shall be deemed to have elected to
be paid the annual retainer entirely in cash.
	 
	 	(b)	 	Deferred Share Units. The Eligible Director will have Deferred Share Units
credited to an account maintained for the Eligible Director on the books of the
Company as of the Purchase Date. The number of Deferred Share Units (including
fractional Deferred Share Units) to be credited shall be determined by dividing one
quarter of the amount of annual retainer to be deferred into Deferred Share Units by
the Fair Market Value on the Purchase Date.

	 	 	Deferred Share Units shall be credited with dividend equivalents when dividends are paid
on Common Shares and such dividend equivalents shall be converted into additional Deferred
Share Units based on the Fair Market Value of Common Shares on the date credited.
	 
	6.	 	Payment and Deferral of Meeting and Chairmanship Fees: An Eligible Director who makes an
election in accordance with Section 5 for a year may also receive (in the same percentage as
applicable to his or her annual retainer) in the form of Deferred Share Units (a) amounts
granted pursuant to the Company’s Directors’ Share Award Plan for the year; and/or (b) his or
her fees otherwise payable for attending Board (or committee) meetings and serving as Chair of
a Board committee during the year. Any such election shall be subject to such approvals and
conditions as the Committee may impose, including appropriate adjustments -to the Purchase
Date.
	 
	7.	 	Adjustments and Reorganizations: In the event of any stock dividend, stock split, combination
or exchange of shares, merger, consolidation, recapitalization, amalgamation, plan of
arrangement, reorganization, spin-off or other distribution (other than normal cash dividends)
of Company assets to shareholders, or any other change affecting shares, such proportionate
adjustments, if any, as the Committee in its discretion may deem appropriate to reflect
such change, shall be made with respect to the number of Deferred Share Units outstanding
under the Plan. In the event the Company is not the surviving company of a merger,
consolidation, amalgamation or plan of arrangement or other corporate restructuring with
another company or in the event of a liquidation, dissolution or reorganization and in the
absence of any surviving corporation’s assumption of

 

 

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		 	outstanding awards made under the Plan, the Committee may provide for appropriate
settlements of Deferred Share Units.
	 
	8.	 	Termination of Board Service: At any time after the Termination of an Eligible Director to
whom Deferred Share Units have been granted under the Plan but no later than the last business
day in December of the first calendar year commencing after that Termination, on a day (the
“Settlement Date’) within such period to be determined by the Eligible Director or Ws or her
representative in his or her sole discretion upon at least 10 days prior written notice to the
Company, the Company shall pay to the Eligible Director a lump sum payment (or as the
Committee may otherwise determine), net of any applicable withholdings, in cash equal to the
number of Deferred Share Units credited to his or her account as of that Termination
multiplied by the Fair Market Value on the Settlement Date.
	 
	9.	 	Transferability of Awards: Deferred Share Units shall not be transferable or assignable
other than by will or the laws of descent and distribution provided that any payment in
respect of an Eligible Director who at the time of payment is under legal disability or who
is, in the judgment of the Committee, unable to care for his or her affairs because of illness
or accident, may be made to the spouse or any child or personal representative of such person,
or to any other individual or entity deemed by the Company to have incurred expenses -for such
person. Any such distribution shall constitute a complete discharge of the Company’s
obligation to make such payment pursuant to this Plan. If any person shall attempt to, or
shall alienate, sell, transfer, assign, pledge or otherwise encumber his or her Deferred Share
Units, or if by any reason of his or her bankruptcy or other event happening at any time, such
Deferred Share Units would devolve upon any other person or would not be enjoyed by the person
entitled thereto under the Plan, then the Committee in its discretion, may terminate the
interest in any such Deferred Share Units of the person entitled thereto under the Plan and
hold or apply them to or for the benefit of such person entitled thereto under the Plan or his
or her spouse, children or other dependents, or any of them, in such manner as the Committee
may deem proper.
	 
	10.	 	No right to Service: Neither participation in the Plan nor any action under the Plan shall be
construed to give any Eligible Director a right to be retained in the service of the Company.
	 
	11.	 	Unfunded Plan: Unless otherwise determined by the Committee, the Plan shall be unfunded.
The Company’s obligation hereunder shall (unless otherwise determined by the Committee)
constitute a general, unsecured obligation, payable solely out of its general assets, and no
Eligible Director or other person shall have any right to any specific assets of the Company.
Neither the Company nor the Committee shall be required to segregate any assets that may at
any time be represented by the amounts credited with respect to Deferred Share Units
hereunder. Neither the Company nor the Committee shall be deemed to be a trustee of any
amounts to be distributed or paid pursuant to the Plan. No liability or obligation of the
Company pursuant to the Plan shall be deemed to be secured by any pledge of, or encumbrance
on, any property of the Company or any affiliate of the Company.
	 
	12.	 	Successors and Assigns: The Plan shall be binding on all successors and assigns of the
Company and an Eligible Director, including without limitation, the estate of such Eligible
Director and the executor, administrator or trustee of such estate, or any receiver or trustee
in bankruptcy or representative of the Eligible Director’s creditors.

 

 

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	13.	 	Plan Amendment: The Board may, in its sole discretion and without the consent of any
Eligible Director (acting in his or her capacity as a participant in the Plan) or
beneficiary, amend the Plan at any time; provided, however, that no amendment shall reduce
the amount of Deferred Share Units credited prior to such amendment to any Eligible
Director.
	 
	14.	 	Plan Termination: The Board may, in its sole discretion and without the consent of any
Eligible Director (acting in his or her capacity as a participant in the Plan) or beneficiary,
terminate the Plan at any time by giving written notice thereof to each Eligible Director who
is -a participant hereunder. Any amounts distributable under the Plan shall be paid to the
persons entitled thereto at such time and in such manner as -the Committee shall determine,
but not later than the date- on which distributions would have been made had the Plan not been
terminated.
	 
	15.	 	Governing Law: The validity, construction -and effect of the Plan and any actions taken or
relating to the Plan shall be governed by the substantive laws, but not the choice of law
rules, of the Province of Quebec.

March 11, 1998

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