Domtar Severance Policy for Senior Executives

Summary

This policy outlines the severance terms for senior executives at Domtar who are terminated for reasons other than cause. Management Committee members receive 24 months of indemnity, while other senior managers receive the greater of 12 months or the amount specified in the current policy. Severance includes continued fringe benefits for the indemnity period, limited car allowance, and access to a re-assignment program. Vested stock options must be exercised within 60 days, while unvested options are cancelled. Bonus eligibility ends if the employee is inactive at year-end, and retirement benefits follow the company's supplementary pension programs.

EX-10.40 24 dex1040.htm DOMTAR SEVERANCE POLICY FOR SENIOR EXECUTIVES Domtar Severance Policy for Senior Executives

Exhibit 10.40

PROTECTION IN CASE OF TERMINATION

(FOR REASON OTHER THAN A SERIOUS MOTIVE, I.E. OTHER THAN FOR CAUSE)


	*Management Committee*	*Other members of Senior* *Management*
*Indemnity*	24 months	The highest of 12 months or as per current policy

*Bonus*	None if employee is unactive as at December 31

*Stock options*	Vested options – 60 days Unvested options – cancelled Retirement – see proposed new policy

*Fringe benefits*	Period equal to indemnity (disability excluded) or until new employment

*Car*	6 months or until new employment	3 months or until new employment

*Re-assignment Program*	Program as per position level

*Retirement*	Supplementary Pension Program (Top Hat 1 and/or Top Hat II as applicable)	Supplementary Pension Program (Top Hat II)