Document:

Exhibit
10.5

 

OFFICEMAX INCORPORATED

Restricted
Stock Unit Award Agreement

 

This Restricted Stock Unit Award (the “Award”), is granted on  April 18, 2005 (the “Award
Date”), by OfficeMax Incorporated (“OfficeMax”) to Sam Duncan (“Awardee” or “you”)
pursuant to the 2003 OfficeMax Incentive and Performance Plan (the “Plan”) and
pursuant to the following terms:

 

1.                                       The Award is subject to all the terms and conditions of the Plan.  All capitalized terms not defined in this
Agreement shall have the meaning stated in the Plan.

 

2.                                       You are
awarded 15,000 restricted stock units, at no cost to you, subject to the
restrictions set forth in the Plan and this Agreement.

 

3.                                       Your Award
is subject to a five-year restriction period. 
On each of the first five anniversaries of the Award Date, 20% of the
restricted stock units granted (and not forfeited under the provisions of
paragraph 4 or paragraph 6) will vest.

 

4.                                      a.                                        If at any
time prior to the third anniversary of the Award Date:  (i) you are involuntarily terminated not
for Cause, as such term is defined in the Employment Agreement between you and
OfficeMax dated April 14, 2005 (the “Employment Agreement”), as determined by
OfficeMax (or any successor), (ii) you terminate employment as a result of
death or Disability, as such term is defined in the Employment Agreement, or
(iii) you voluntarily terminate employment for Good Reason, as such term
is defined in the Employment Agreement, then a pro rata portion of the unvested
units, calculated according to paragraph 4.b, shall vest.

 

b.                                      The pro rata
portion of units vesting under paragraph 4.a shall be calculated as follows:

 

•                  If
termination occurs on or before the first anniversary of the Award Date, you
will receive:

 

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 12 months, plus

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 24 months, plus

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 36 months, plus

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 48 months, plus

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 60 months.

 

•                  If
termination occurs after the first anniversary of the Award Date but on or
before the second anniversary of the Award Date, you will receive:

 

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 24 months, plus

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 36 months, plus

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 48 months, plus

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 60 months.

 

 

•                  If
termination occurs after the second anniversary of the Award Date but on or
before the third anniversary of the Award Date, you will receive:

 

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 36 months, plus

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 48 months, plus

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 60 months.

 

•                  If
termination occurs after the third anniversary of the Award Date but on or
before the fourth anniversary of the Award Date, you will receive:

 

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 48 months, plus

•                  A pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 60 months.

 

•                  If
termination occurs after the fourth anniversary of the Award Date but on or
before the fifth anniversary of the Award Date, you will receive a pro rata
portion of 20% of the unvested units based on the number of months worked since
the Award Date divided by 60 months.

 

The restrictions on any units vesting by
operation of this paragraph 4 will lapse and the units will vest as of the
termination date.

 

c.                                       Upon your
voluntary or involuntary termination for any reason other than as specified in
paragraph 4.a, all units not yet vested at the time of termination will be
immediately forfeited.  In addition, upon
your termination as specified in paragraph 4.a, any units remaining unvested
after the pro rata vesting will be immediately forfeited.

 

5.                                       In
the event of a Change in Control (as defined in the Plan) prior to the third
anniversary of the Award Date, the continuing entity may either continue this
Award or replace this Award with an award of substantially equivalent value
with terms and conditions not less favorable than the terms and conditions
provided in this Award Agreement, in which case the Award will vest according
to the terms of the applicable Award Agreement. 
If the continuing entity does not so continue or replace this Award, or
if you experience a Qualifying Termination (as defined in the letter agreement
between you and OfficeMax regarding benefits upon a change in control), all
units not vested at the time of the Change in Control or your termination (as
applicable) will vest immediately.

 

6.                                       The units
awarded pursuant to this Agreement cannot be sold, assigned, pledged,
hypothecated, transferred, or otherwise encumbered prior to vesting.  Any attempt to transfer your rights in the
awarded units prior to vesting will result in the immediate forfeiture of the
units.

 

7.                                       With respect
to the awarded units, you are not a shareholder and do not have any voting
rights.  You will not receive dividends
or dividend units on the awarded units until vesting.  Upon vesting, you receive notional dividend
units on the vested awarded units equal to the amount of dividends paid on
OfficeMax’s common stock on and after the vesting date.

 

8.                                       Vested
restricted stock units will be paid to you in whole shares of OfficeMax common
stock upon vesting, provided that if in OfficeMax’s good faith determination,
some or all of the remuneration attributable to this payment is not deductible
by OfficeMax for federal income tax purposes pursuant to Section 162(m) of
the Code, then payment of such units will occur the day following the six month
anniversary of your termination of employment with OfficeMax, and provided
further that if in OfficeMax’s good faith determination this deferral could
reasonably be expected to result in the imposition of tax upon you with respect
to the units prior to payment of the units, payment of all units will occur the
day following the six month anniversary of your termination of employment with

 

 

OfficeMax.  Partial shares, if any, and dividend units
will be paid in cash.

 

You must sign this Agreement and return it to OfficeMax’s Compensation
Department on or before May 13, 2005, or the Award will be forfeited.  Return your executed Agreement to:  Linda VanDeventer, OfficeMax, 150 Pierce
Road, Itasca, IL  60143, or fax your
signed form to 630-438-2463.

 

	
  OfficeMax Incorporated

  	
  Awardee

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Matthew R. Broad

  	
   

  	
  /s/ Sam Duncan

  
	
   

  	
  Signature

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Sam Duncan

  
	
   

  	
  Printed NameEXHIBIT 10.6

 

OFFICEMAX INCORPORATED

 

2005 Annual Incentive Award Agreement

 

This Annual Incentive Award (the “Award”), is
granted on April 18, 2005 (the “Award Date”), by OfficeMax Incorporated (“OfficeMax”)
to Sam Duncan (“Awardee” or “you”) pursuant to the 2003 OfficeMax Incentive and
Performance Plan (the “Plan”) and pursuant to the following terms:

 

1.                                       The
Award is subject to all the terms and conditions of the Plan.  All capitalized terms not defined in this
Agreement shall have the meaning stated in the Plan.

 

2.                                       For
purposes of this Award, the following terms shall have the meanings stated
below.

 

2.1.                              “Award
Period” means the 2005 fiscal year.

 

2.2.                              “Base
Salary” means your annual pay rate in effect at the end of the Award Period,
without taking into account (a) any amounts deferred pursuant to an election
under any 401(k) plan, pre-tax premium plan, deferred compensation plan, or
flexible spending account sponsored by OfficeMax or any subsidiary, (b) any
incentive compensation, employee benefit, or other cash benefit paid or
provided under any incentive, bonus or employee benefit plan sponsored by
OfficeMax or any subsidiary, or (c) any excellence award, gains upon stock
option exercises, restricted stock grants or vesting, moving or travel expense
reimbursement, imputed income, or tax gross-ups, without regard to whether the
payment or gain is taxable income to you.

 

2.3.                              “EBIT
dollars” means OfficeMax’s earnings from operations before interest and taxes,
as calculated by OfficeMax in its sole discretion.

 

2.4.                              “Net
sales” means the gross sales or revenues less returns, allowances, rebates, and
coupons for OfficeMax, as calculated by OfficeMax in its sole discretion.

 

2.5.                              “Return
on sales” means the ratio of reported operating profit to reported net sales,
expressed as a percentage, for OfficeMax during the Award Period, as calculated
by OfficeMax in its sole discretion.

 

2.6.                              “Sales
growth” means the percentage change in overall same location net sales for
OfficeMax during the Award Period, adjusted for store closures, store openings,
acquisitions, divestitures, and changes in fiscal periods, as calculated by
OfficeMax in its sole discretion.

 

3.                                       Your
target award percentage is 100% of your Base Salary.

 

4.                                       The
Performance Goals applicable to your Award are sales growth, return on sales,
and EBIT dollars.  Your Award will be
calculated based on these Performance Goals, as follows:

 

4.1.                              Payout.  Each
Performance Goal is weighted equally. 
Using the payout charts attached as Exhibit 1, a payout multiple will be
identified for each Performance Goal. 
Your target award percentage will be divided by three, that number will
be multiplied by the identified multiple, and the resulting percentage will be
applied to your Base Salary to determine your actual Award for each Performance
Goal.

 

 

4.2.                              General Terms.  Payout
multiples between numbers indicated on the chart will be calculated using
straight-line interpolation.  Total
payout (aggregate amount paid for all three Performance Goals) is capped at
2.25 times your target award percentage. 
Individual payout for each Performance Goal is capped at 2.25 times the
applicable target award percentage. 
Notwithstanding the Performance Goals and formulas set forth above, no
award will be earned or paid for the Award Period unless OfficeMax has net
income for the Award Period, as calculated by OfficeMax in its sole discretion.

 

5.                                       This
Award will be paid in cash.

 

6.                                       If
you terminate employment before December 31, 2005, your Award will be treated
as follows:

 

6.1.                              If
your termination of employment is a result of your death or Disability, as
defined in the Employment Agreement between you and OfficeMax dated April 14,
2005 (the “Employment Agreement”), you will receive a pro rata Award, if an
Award is paid, based on the number of days during the Award Period that you
were employed and eligible compared to the total number of days in the Award
Period.

 

6.2.                              If
you are involuntarily terminated by the Company other than for death,
Disability, or Cause (as defined in the Employment Agreement), or if you
terminate employment for Good Reason (as defined in the Employment Agreement),
you will receive a pro rata Award, if an Award is paid, based on the number of
days during the Award Period that you were employed and eligible compared to
the total number of days in the Award Period.

 

6.3.                              Except
as described in paragraphs 6.1 and 6.2, you must be employed by OfficeMax or
its subsidiary on the last day of the Award Period to be eligible to receive
payment of an Award.  If your employment
is terminated for Cause or for any other reason except as described in
paragraph 6.1 or 6.2, you will not be eligible to receive payment of any Award
for 2005.

 

7.                                       Notwithstanding
the Performance Goals, you will receive a minimum Award of 100% of your Base
Salary, provided that this minimum Award will not apply to payments occurring
pursuant to paragraph 6.

 

8.                                       The
Committee reserves the right to reduce the Award (but not below the minimum
Award payable pursuant to paragraph 7), whether or not the Performance Goals
have been met.

 

9.                                       In
the event of a Change in Control (as defined in the Plan) prior to December 31,
2005, the provisions of the Plan shall apply.

 

You must sign this Agreement and return it to OfficeMax’s Compensation
Department on or before May 13, 2005, or the Award will be forfeited.    Return your executed Agreement to:  Linda VanDeventer, OfficeMax, 150 E Pierce
Road, Itasca, IL 60143, or fax your signed form to 630-438-2463.

 

	
  OfficeMax
  Incorporated

  	
  Awardee

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Matt
  Broad

  	
   

  	
  /s/ Sam
  Duncan

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Sam Duncan

  	
   

  
	
   

  	
  Printed Name

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