SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
INTERNATIONAL PAPER COMPANY
(Exact Name of Registrant as specified in its charter)
New York 13-0872805
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
400 Atlantic Street
Stamford, Connecticut 06921
(Address including zip code of Principal Executive Offices)
-------------------------
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INTERNATIONAL PAPER COMPANY
DEFERRED COMPENSATION SAVINGS PLAN
(Full title of the plan)
Barbara L. Smithers, Esq.
Vice President and Secretary
International Paper Company
400 Atlantic Street
Stamford, Connecticut 06921
(203) 541-8000
(Name, address and telephone number, including area code, of agent for service)
Copy to:
Beverly F. Chase
Davis Polk & Wardwell
450 Lexington Avenue
New York, New York 10017
212-450-4000
PART I
The information specified in Item 1 and Item 2 of Part I of the Registration Statement on Form S-8 (the "Registration Statement") is omitted from this filing in accordance with the provisions of Rule 428 under the Securities Act of 1933, as amended (the "1933 Act") and the introductory note to Part I of the Registration Statement. The documents containing the information specified in Part I will be delivered to the participants in the plan covered by this Registration Statement as required by Rule 428(b)(1).
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed with the Securities and Exchange Commission (the "Commission") by International Paper Company (the "Company") pursuant to the Securities Exchange Act of 1934, as amended (the "1934 Act"), are incorporated herein by reference.
(1) The Company's Annual Report on Form 10-K for the year ended December 31, 2001.
(2) All reports filed pursuant to Section 13(a) or 15(d) of the 1934 Act since December 31, 2001, including the Company's Current Report on Form 8-K, filed January 22, 2002.
(3) The description of the Company's capital stock which is contained in the Company's registration statement on Form 8-A, dated July 20, 1976, as amended.
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the 1934 Act, prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference herein and to be a part hereof from the date of
filing of such documents.
Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Registration Statement to the extent that a statement contained herein or in any other subsequently filed document which also is incorporated or deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL
Certain legal matters with respect to the offering of the Deferred Compensation Obligations registered hereby have been passed upon by Barbara L. Smithers, Esq., Vice President and Secretary of the Company. Ms. Smithers does not participate in the Plan.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 721 of the New York Business Corporation Law ("NYBCL") provides that, in addition to indemnification provided in Article 7 of the NYBCL, a corporation may indemnify a director or officer by a provision contained in its certificate of incorporation or by-laws or by a duly authorized resolution of its shareholders or directors or by agreement, provided that no indemnification may be made to or on behalf of any director or officer if a judgment or other final adjudication adverse to the director or officer establishes that his acts were committed in bad faith or were the result of active and deliberate dishonesty and material to the cause of action, or that such director or officer personally gained in fact a financial profit or other advantage to which he was not legally entitled.
Section 722(a) of the NYBCL provides that a corporation may indemnify a director or officer made, or threatened to be made, a party to any action other than a derivative action, whether civil or criminal, against judgments, fines, amounts paid in settlement and reasonable expenses actually and necessarily incurred as a result of such action, if such director or officer acted, in good faith, for a purpose which he reasonably believed to be in, or not opposed to, the best interests of the corporation and, in criminal actions or proceedings, in addition, has no reasonable cause to believe that his conduct was unlawful.
Section 722(c) of the NYBCL provides that a corporation may indemnify a director or officer, made or threatened to be made a party in a derivative action, against amounts paid in settlement and reasonable expenses actually and necessarily incurred by him in connection with the defense or settlement of such action or in connection with an appeal therein if such director or officer acted, in good faith, for a purpose which he reasonably believed to be in, or not opposed to, the best interests of the corporation, except that no indemnification will be available under Section 722(c) of the NYBCL in respect of a threatened or pending action which is settled or otherwise disposed of or any claim as to which such director or officer shall have been adjudged liable to the corporation, unless and only to the extent that the court in which the action was brought, or, if no action was brought, any court of competent jurisdiction, determines, upon application, that, in view of all the circumstances of the case, the director or officer is fairly and reasonably entitled to indemnity for such portion of the settlement amount and expenses as the court deems proper.
Section 723 of the NYBCL specifies the manner in which payment of indemnification under Section 722 of the NYBCL or indemnification permitted under Section 721 of the NYBCL may be authorized by the corporation. It provides that indemnification may be authorized by the corporation. It provides that indemnification by a corporation is mandatory in any case in which the director or officer has been successful, whether on the merits or otherwise, in defending an action. In the event that the director or officer has not been successful or the action is settled, indemnification must be authorized by the appropriate corporate action as set forth in Section 723.
Section 724 of the NYBCL provides that, upon application by a director or officer, indemnification may be awarded by a court to the extent authorized under Section 722, and 723 of the NYBCL contains certain other miscellaneous provisions affecting the indemnification of directors and officers.
Section 726 of the NYBCL authorizes the purchase and maintenance of insurance to indemnify (1) a corporation for any obligation which it incurs as a result of the indemnification of directors and officers under the above section, (2) directors and officers in instances in which they may be indemnified by a corporation under such section, and (3) directors and officers in instances in which they may not otherwise be indemnified by a corporation under such section, provided that the contract of insurance covering such directors and officers provides, in a manner acceptable to the New York State Superintendent of Insurance, for a retention amount and for co-insurance.
Article VII of the Restated Certificate of Incorporation of the Company provides in part as follows:
"Each Director of the Corporation shall be indemnified by the Corporation against expenses actually and necessarily incurred by him in connection with the defense of any action, suit or proceeding in which he is made a party by reason of his being or having been a Director of the Corporation, except in relation to matters as to which he shall be adjudged in such action, suit or proceeding to be liable for negligence or misconduct in the performance of his duties as such Director, provided that such right of indemnification shall not be deemed exclusive of any other rights to which a Director of the Corporation may be entitled, under any by-law, agreement, vote of stockholders or otherwise."
Article IX of the By-laws, as amended, of the Company provides as follows:
"The Corporation shall indemnify each Officer or Director who is made, or threatened to be made, a party to any action by reason of the fact that he or she is or was an Officer or Director of the Corporation, or is or was serving at the request of the Corporation in any capacity for the Corporation or any other enterprise, to the fullest extent permitted by applicable law. The Corporation may, so far as permitted by law, enter into an agreement to indemnify and advance expenses to any Officer or Director who is made, or threatened to be made, a party to any such action."
The Company has purchased certain liability insurance for its officers and
directors as permitted by Section 727 of the NYBCL and has entered into
indemnity agreements with its directors and certain officers providing
indemnification in addition to that provided under the NYBCL as permitted by
Section 721 of the NYBCL.
Insofar as indemnification for liabilities arising under the 1933 Act may be permitted to directors, officers or persons controlling the Company pursuant to the foregoing provisions, the Company has been informed that in the opinion of the Commission such indemnification is against public policy as expressed in the 1933 Act and is therefore unenforceable.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
4.1 Form of Restated Certificate of Incorporation (incorporated by reference to the Company's Current Report on Form 8-K dated November 20, 1990, File No. 1-3157).*
4.2 Certificate of Amendment to the Certificate of Incorporation (incorporated herein by reference to Exhibit (3)(i) to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1999, File No. 1-3157).*
4.3 Certificate of Amendment to the Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2001, File No. 1-3157).*
4.4 By-laws of the Company, as amended (incorporated by reference to Exhibit 3.4 of the Company's Annual Report on Form 10-K for the year ended December 31, 2001, File No. 1-3157).*
4.5 Summary Plan Description for International Paper Company Deferred Compensation Savings Plan.
5 Opinion of Barbara L. Smithers, Esq., Vice President and Corporate Secretary.
23.1 Consent of Arthur Andersen LLP, Independent Public Accountants.
23.2 Consent of Barbara L. Smithers, Esq. (included in Exhibit 5).
ITEM 9. REQUIRED UNDERTAKINGS
(a) The undersigned Company hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement to include any material information with respect to the plan of distribution not previously disclosed in this Registration Statement or any material change to such information in this Registration Statement.
(2) That, for the purpose of determining any liability under the 1933 Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(b) The undersigned company hereby undertakes that, for purposes of determining any liability under the 1933 Act, each filing of the Company's annual report pursuant to Section 13(a) or Section 15(d) of the 1934 Act (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the 1934 Act) that is incorporated by reference in this Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the 1933 Act may be permitted to directors, officers and controlling persons of the Company pursuant to the foregoing provisions, or otherwise, the Company has been advised that, in the opinion of the Commission, such indemnification is against public policy as expressed in the 1933 Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the company of expenses incurred or paid by a director, officer or controlling person of the Company in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Company will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the 1933 Act and will be governed by the final adjudication of such issue.
EXPERTS
The financial statements and schedule included (or incorporated by reference) in this Registration Statement have been audited by Arthur Andersen LLP, Independent Public Accountants, as indicated in their reports with respect thereto, and are included herein in reliance upon the authority of said firm as experts in accounting and auditing in giving said reports.
SIGNATURES
Pursuant to the requirements of the 1933 Act, the Company certifies that it has reasonable grounds to believe that it meets all of the requirements for filing this Registration Statement and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Stamford, State of Connecticut, on the 8th day of April, 2002.
INTERNATIONAL PAPER COMPANY
By: /s/ Barbara L. Smithers
------------------------------------
Name: Barbara L. Smithers
Title: Vice President and Secretary
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Pursuant to the requirements of the 1933 Act, the trustees (or other persons who administer the International Paper Company Deferred Compensation Savings Plan) have duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Stamford, State of Connecticut on the 8th day of April, 2002.
INTERNATIONAL PAPER COMPANY
DEFERRED COMPENSATION SAVINGS PLAN
By: /s/ Jerry Carter
------------------------------------
Name: Jerry Carter
Title: Plan Administrator
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Pursuant to the requirements of the 1933 Act, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
Chairman of the Board, Chief
/s/ John T. Dillon Executive Officer and Director April 8, 2002
-------------------------
John T. Dillon
/s/ Robert J. Eaton Director April 8, 2002
-------------------------
Robert J. Eaton
/s/ Samir G. Gibara Director April 8, 2002
-------------------------
Samir G. Gibara
/s/ James A. Henderson Director April 8, 2002
-------------------------
James A. Henderson
/s/ John R. Kennedy Director April 8, 2002
-------------------------
John R. Kennedy
/s/ Robert D. Kennedy Director April 8, 2002
-------------------------
Robert D. Kennedy
/s/ W. Craig McClelland Director April 8, 2002
-------------------------
W. Craig McClelland
/s/ Donald F. McHenry Director April 8, 2002
-------------------------
Donald F. McHenry
/s/ Patrick F. Noonan Director April 8, 2002
-------------------------
Patrick F. Noonan
/s/ Jane C. Pfeiffer Director April 8, 2002
-------------------------
Jane C. Pfeiffer
/s/ Jeremiah J. Sheehan Director April 8, 2002
-------------------------
Jeremiah J. Sheehan
/s/ Charles R. Shoemate Director April 8, 2002
-------------------------
Charles R. Shoemate
/s/ John V. Faraci Executive Vice President and
------------------------- Chief Financial Officer April 8, 2002
John V. Faraci
/s/ Andrew R. Lessin Vice President--Finance and
------------------------- Chief Accounting Officer April 8, 2002
Andrew R. Lessin
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EXHIBIT INDEX
4.1 Form of Restated Certificate of Incorporation (incorporated by reference to the Company's Current Report on Form 8-K dated November 20, 1990, File No. 1-3157).*
4.2 Certificate of Amendment to the Certificate of Incorporation (incorporated herein by reference to Exhibit (3)(i) to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1999, File No. 1-3157).*
4.3 Certificate of Amendment to the Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2001, File No. 1-3157).*
4.4 By-laws of the Company, as amended (incorporated by reference to Exhibit 3.4 of the Company's Annual Report on Form 10-K for the year ended December 31, 2001, File No. 1-3157).*
4.5 Summary Plan Description for International Paper Company Deferred Compensation Savings Plan.
5 Opinion of Barbara L. Smithers, Esq., Vice President and Corporate Secretary.
23.1 Consent of Arthur Andersen LLP, Independent Public Accountants.
23.2 Consent of Barbara L. Smithers, Esq. (included in Exhibit 5).
EXHIBIT 5
[LETTERHEAD OF INTERNATIONAL PAPER COMPANY]
April 8, 2002
Securities and Exchange Commission
450 Fifth Street
Washington, D.C. 20549
Ladies and Gentlemen:
I am Vice President and Secretary, International Paper Company, a New York corporation (the "Company"), and have acted as counsel in connection with the Registration Statement on Form S-8 (the "Registration Statement") to register under the Securities Act of 1933, as amended, certain interests in the International Paper Company Deferred Compensation Savings Plan (the "Plan").
I have examined originals or copies, certified or otherwise identified to my satisfaction, of such corporate documents and records which I have deemed necessary or appropriate for the purposes of the opinion and have conducted such other investigations of fact and law as I have deemed necessary or advisable for purposes of this opinion. I have assumed that the signatures on all documents that I have examined are genuine.
Based upon the foregoing, I am of the opinion that the participants' rights under the Plan will be, when created in accordance with the terms of the Plan, valid and binding obligations of the Company, enforceable in accordance with the terms of the Plan, except as enforcement thereof may be limited by bankruptcy, insolvency or other laws of general applicability relating to or affecting creditors' rights or by general equity principles.
I hereby consent to the filing of the opinion as an exhibit to the Registration Statement.
Very truly yours,
/s/ Barbara L. Smithers ------------------------------------ Barbara L. Smithers, Esq. Vice President and Secretary |
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by reference in this Registration Statement on Form S-8 of our reports dated February 12, 2002 included (or incorporated by reference) in International Paper Company's Annual Report on Form 10-K for the year ended December 31, 2001 and to all references to our Firm included in this Registration Statement.
/s/ Arthur Andersen LLP
---------------------------------
ARTHUR ANDERSEN LLP
New York, New York
April 2, 2002
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Introduction
The International Paper Company Deferred Compensation Savings Plan (the DCSP or Plan) is a savings plan designed to provide you with the opportunity to save through your own deferrals of pay and through company matching contributions.
The DCSP is an unfunded deferred compensation plan. This means that the pay that you defer under the DCSP and any company matching contributions credited to your account are not invested in a separate trust. Instead, all deferred amounts will be paid directly by the Company out of its general assets at the time benefits become due and payable under the Plan.
The Plan was amended and restated effective January 1, 1995. This booklet reflects provisions effective April 1, 2002, unless otherwise indicated.
This booklet is intended to help you better understand your benefits under the Plan. If there is any conflict between the information in this summary plan description and the provisions of the Plan, the plan document always will control.
Overview of the Plan
- You have the opportunity to defer more than the statutory maximum allowed in the International Paper Company Salaried Savings Plan (the SSP);
- Company matching contributions are credited on a specified percentage of your employee contributions;
- Employee contributions may be credited with earnings based on your choice of investment fund equivalents;
- Fifty percent of the company matching contributions are credited with earnings based on the Company Stock Fund Equivalent (Company Match Restricted); the remaining 50 percent may be invested in any of the fund equivalents you choose (Company Match Unrestricted);
- Taxes are deferred on your contributions, company matching contributions and earnings credited to your account until distributed from the Plan;
- The value of your contributions is vested immediately; the value of your company matching contributions is vested after three years of service;
- While you are actively employed, you may withdraw specific dollar amounts from your account, subject to certain conditions;
- Beginning the year you attain age 55, you may transfer all or part of your Company Match Restricted from the Company Stock Fund Equivalent to any of the investment fund equivalents; and
- Upon termination of employment, you may receive your account balance in a lump sum or installments, or you may defer commencement up to age 701/2.
Who Is Eligible
You are eligible to participate in the Plan if you are:
- Eligible to participate in the Salaried Savings Plan; and
- Employed in Position Level 18 or above (or equivalent) or have SSP plan compensation in excess of the 401(a)(17) limit for the preceding calendar year (e.g., $170,000 compensation received in 2001 and $200,000 compensation received in 2002).
In order to participate, you must enroll in the Plan and be actively contributing to the Salaried Savings Plan.
How to Enroll
When you become eligible, you will be given an enrollment packet. You may make your elections by calling J.P. Morgan / American Century Retirement Plan Services InfoLine or log in to www.retireonline.com. If you choose to make contributions to the Plan, you will:
- Select the percentage of total pay you want to contribute to the Plan;
- Authorize the company to make payroll deductions for your contributions;
- Choose the investment fund equivalent(s) for your contributions; and
- Select your beneficiary(ies).
Important Note: If you choose not to join the Plan when you first become eligible, you may join at a later date by calling the InfoLine or log in to www.retireonline.com.
Participation
How the Plan Works
If you choose to participate in the DCSP, you must make the following decisions:
- The percentage of compensation which you wish to save; and
- Your choice to either maximize before-tax contributions or to maximize contributions to the SSP.
Each calendar year, your contributions to the DCSP will only begin when your contributions to the SSP are restricted by an IRS limit.
If you choose to maximize before-tax contributions, once you have contributed the maximum before-tax contributions to the SSP ($11,000 for 2002), your contributions to the DCSP will start.
If you choose to maximize contributions to the SSP, once you have contributed the maximum before-tax contributions to the SSP, you will make after-tax contributions to the SSP until you reach another IRS limit and can no longer make contributions to the SSP (for example, $40,000 contributed to your account in the year or maximum compensation of $200,000). Then your contributions to the DCSP will start.
How Participation in the Plan
Affects Your Other Benefits
Most salaried pensions under the Retirement Plan of International Paper Company are based on final average earnings. In general, earnings included in the pension calculation are base pay, bonuses and salary deferrals to the SSP and to Internal Revenue Code Section 125 Plans (including Health and Dependent Day Care contributions), but not salary deferred as contributions under this Plan. Thus, making contributions to the DCSP during your final years of employment, when final average earnings are calculated, could reduce your annual pension from the Retirement Plan.
However, if your Retirement Plan pension is reduced by your contributions to this Plan, the amount of the reduction will be paid as a benefit from the International Paper Company Pension Restoration Plan at retirement. The Pension Restoration Plan is a nonqualified plan with benefits paid from the general assets of the company.
Important Note Making contributions to this Plan will not lower your life insurance or disability insurance benefits from the company.
Types of Contributions
The following sections describe the various types of contributions you may make to the DCSP, as well as any company matching contributions that may be credited to your accounts under the DCSP. You must designate the percentage of your total pay that you wish to contribute to the DCSP. For purposes of this Plan, pay means your base pay plus overtime, shift differential, commissions, gainsharing, and other incentive or variable compensation that you are entitled to receive, but excludes severance pay.
Employee Contributions
You may contribute up to 85 percent of your pay to the Deferred Compensation Savings Plan. These contributions are deferred salary, made on a before-tax basis.
Company Matching Contributions
The company will credit matching contributions to your DCSP account in an amount equal to a specified percentage of the employee contributions that you make. The company matching contribution percentages are listed in the Appendix.
MIP Deferral Election
As a participant in the company's Management Incentive Plan (MIP), you have the option of making a separate election as to the rate of contributions you wish to make to the DCSP from your MIP award. Your election, which affects your bonus to be paid in the following calendar year, must be made by August 31 of the current year. Each year, in advance of the August 31 deadline, you will receive communications outlining the process to make this election. Other specified bonuses also may be deferred to the DCSP.
Changing Your Rate of Contributions
You may:
- Increase or decrease the percentage of total pay you contribute under the DCSP; or
- Suspend your contributions.
To make a change, call InfoLine or log in to www.retireonline.com. The change will take effect as soon as administratively possible.
Investment Options
The Plan has a two-tiered investment lineup. Since this is an unfunded plan, your contributions and any company matching contributions are not invested in a separate trust. Instead, your account is simply credited with the same investment gain or loss that it would have received had it been invested in the actual funds available under the Salaried Savings Plan.
Employee Contributions and Company Match Unrestricted
You may invest your employee contributions and Company Match Unrestricted in any of the fund equivalents.
Company Match Restricted
Company Match Restricted is invested in the Company Stock Fund equivalent.
Changing Investment of Future Contributions
You may change your choice of investment fund equivalents for your future employee contributions and Company Match Unrestricted daily. Your investment selection will be processed within the next business day.
Investment Fund Equivalents
The investment fund equivalents for the DCSP will be based on the SSP Tier I and Tier II funds as described below. There will be no Tier III Brokerage Window equivalent in the DCSP.
Investment Options
The Plan offers a two-tiered fund structure that includes Tier I SmartMix Funds and Tier II Core Funds.
Tier I: SmartMix Funds
These funds offer one-stop shopping through professionally designed and managed diversified portfolios at three different risk levels: conservative, moderate and aggressive.
The Conservative Fund
The Conservative Fund seeks low to moderate growth primarily from interest income but also from some capital appreciation and dividends. This Fund will not invest in emerging market stocks or low quality bonds since the risk of loss from these investments would be too great.
The Moderate Fund
The Moderate Fund seeks moderate growth from capital appreciation, dividends and interest income. A small percentage (less than 15 percent) of the Fund may be invested in higher risk asset classes such as emerging market stocks, high yield bonds and emerging market bonds.
The Aggressive Fund
The Aggressive Fund seeks high growth primarily from capital appreciation, but also from some interest income and dividends. This Fund usually will invest in asset classes that have higher risk but also have a potential for greater long-term returns, such as emerging market stocks, high yield bonds and emerging market bonds.
Tier II: Core Funds
The core funds offer a variety of investment choices, each representing a different, well-defined market segment, similar to those that professional investment managers use to build custom portfolios for their clients. The core investment funds are outlined in the IP Savings Plan Investor's Guide. For additional information regarding the Tier II core funds, contact J.P. Morgan/American Century.
Rate of Return on Your Investment
Any investment involves some degree of financial risk. Furthermore, since your DCSP contributions are not in a separate trust but are part of the
Company's general assets, participation in this Plan involves greater risks than participation in the Salaried Savings Plan. The annual investment results will vary depending on the growth of the equivalent investment fund that is being mirrored.
Valuation of Your Account
Each of the investment fund equivalents is valued by the plan trustee every day that the New York Stock Exchange (NYSE) is open. The value of your account is equal to:
- The amount of your contributions;
- Plus company matching contributions;
- Plus deemed reinvested earnings;
- Plus any equivalent increase or less any equivalent decrease in the market value of your investments;
- Less any withdrawals or distributions from your account.
Quarterly, you will receive a statement showing the value of your account.
This statement will show all savings activity, including your contributions,
company matching contributions, investment experience and any transfers,
withdrawals or distributions made in that investment period. If you need to know
the value of your account at any other time, you may contact J.P.
Morgan/American Century by calling InfoLine at 1-800-345-2345 or logging in to
www.retireonline.com.
Interfund Transfers
Transfers of Unrestricted Amounts
Each day, you may transfer unrestricted amounts from one investment option to any of the Plan's other investment options. Generally, unrestricted amounts include your employee contributions and Company Match Unrestricted. To make a transfer, log in to www.retireonline.com or call InfoLine at any time. The transfers will take effect each day that the NYSE is open, provided that the request is entered by the close of business, generally 4:00 p.m. Eastern time.
Transfers of Restricted Amounts
Beginning January 1 of the year in which you attain age 55 or upon termination of employment, Company Match Restricted amounts in the Company Stock Fund equivalents are eligible for transfer and will be included in any transfer request you make.
Vesting Rights
Vesting of Your Contributions
You always are 100 percent vested in the value of your contributions to the Plan.
Vesting of Company Matching Contributions
You become 100 percent vested in the value of the company matching contributions in your account upon completion of three years of service.
Withdrawals
To offer you the financial flexibility you may need, the Plan gives you access to your account during your active employment through withdrawals, subject to certain conditions described below.
General Withdrawal
You may request a withdrawal, for any reason and in any amount, to be paid from the balance of your employee contributions. There are two methods for making this request.
You may request a withdrawal to be paid in the year following your request, provided that the request is made at least six months prior to the designated payment date.
Alternatively, if your request does not meet the above requirements, you may request a withdrawal at any time, with a 10 percent penalty assessed against the amount of your requested withdrawal.
A withdrawal request is irrevocable.
Hardship Withdrawal
You may request a withdrawal, in any amount, to be paid from the balance of your employee contributions in the event of an extreme hardship. Generally, it is intended that hardship withdrawals from this Plan may be made for reasons permitted under Section 401(k) of the IRC. Hardship withdrawals may be made for:
- Payment to prevent eviction from or foreclosure on the mortgage of your principal residence; and
- Uninsured and otherwise unreimbursed losses arising from (1) natural causes or Acts of God; (2) crime (reported to police or other appropriate authorities) where you, your spouse or any dependent is the victim of such crime; or (3) fire.
The plan administrator is responsible for approving or denying all hardship withdrawal requests.
Important Note Any withdrawal may be restricted to the extent necessary to comply with certain statutory limitations regarding the five officers subject to proxy disclosure reporting.
Distributions
Distribution of your account balance is made under a form of payment described below.
Normal Form
Under the normal form, your account balance will be distributed to you in a lump sum in January following your termination of employment or retirement.
Optional Form
If you do not want your distribution paid in the normal form, you may make a choice prior to your termination of employment to have your distribution paid in an optional form. Under this choice, you may defer receipt of your account balance to a designated date beginning any time in the year following retirement and up to age 70 1/2, and you may choose to receive distribution in either a lump sum or installments over five to 20 years. If you elect the optional form, you must forward a completed distribution and deferral form to J.P. Morgan/American Century prior to your termination of employment. This election is irrevocable upon your termination of employment.
How Payments Are Made
Lump-Sum Payment
A lump-sum payment is a one-time cash payment of your account balance.
Installment payments
You may elect to receive distribution of your account in the Plan in installment payments. If you choose installments, you must designate the term of the installments and whether you want them paid monthly, quarterly or annually. The terms of installments may be from five to 20 years, but in no case may the term exceed your life expectancy or the joint life expectancies of you and your beneficiary(ies). All payments under this option will be made in cash. While installments are being paid, you may continue to make transfers among the investment funds. If you die after installment payments have begun, but before you have collected the full amount due you under the Plan, the remaining installment payments will continue to your beneficiary(ies).
Once installment payments begin, you (or in the event of your death, your beneficiary(ies)) may request distribution of the balance of your account in a single lump-sum payment by filing a written notice with the plan administrator.
Distributions Upon Death
If you die while actively employed or before distribution of your account balance, the value of your account will be paid to your designated beneficiary(ies) in a lump sum as soon as practicable following your death.
If you die while receiving installment payments, the remaining installment payments will continue to your designated beneficiary(ies). The plan administrator, in its discretion, may choose to pay the balance in a lump sum to your beneficiary(ies).
Other Information
If You Are Transferred
If you are transferred to a subsidiary or group that is not covered by the Plan and, as a result, are no longer eligible to make deferrals under the Plan, your account will remain in the Plan until distributed. However, you will not be able to make contributions under the Plan, and the company will not credit any additional company matching contributions to your account.
Federal Income Tax Information
While any amount you choose to defer as DCSP contributions will reduce the amount of your current reportable total pay for federal income and certain state and local income tax purposes, your deferral will not reduce the amount of your reportable total pay which is subject to Social Security and Medicare taxes. All amounts deferred (and company matching contributions as they "vest") are included in your Social Security and Medicare wage bases subject to the statutory annual Social Security maximum wage base (the Medicare wage base is unlimited).
When you receive a payment from the Plan, you will be responsible for paying any income taxes that apply in the year you receive your payment. The total amount of your distribution (including withdrawals) will be reflected on your Form W-2 from the company and will be taxable as additional compensation in the year of payment.
Federal and state laws require that applicable federal, state and local income taxes be withheld from your distribution. The plan administrator will provide you with a distribution statement showing the details.
Because the Plan is an unfunded, non-qualified deferred compensation plan, the rollover rules are not available.
General Administration of the Plan
Plan Sponsor
The Plan described in this summary plan description is sponsored by:
International Paper Company
400 Atlantic Street
Stamford, CT 06921
(203) 541-8000
Plan Administrator
The administration of the Plan is the responsibility of the plan administrator, who is:
Senior Vice President, Human Resources
International Paper
c/o Employee Benefits Department
6400 Poplar Avenue
Memphis, TN 38197
(901) 763-6000
As an officer of the company, the plan administrator serves at the discretion of the company's board of directors. No charge is made to the employee accounts under this Plan for compensation of the plan administrator.
Amendment and Termination
The company reserves the right to amend, suspend or terminate the Deferred Compensation Savings Plan at any time, provided that any such action shall not adversely affect any plan participant's right to receive payment, pursuant to the terms of this Plan, of any unpaid vested amounts.
ERISA Classification
The Plan is an unfunded employee pension benefit savings plan that is maintained by the company "for the purpose of providing deferred compensation for a select group of management or highly compensated employees." The Plan is, therefore, exempt from Parts 2, 3 and 4 of Subtitle B of Title I of the Employee Retirement Income Security Act of 1974, as amended (ERISA) which pertains to participation and vesting, funding and fiduciary responsibilities. Pursuant to regulations issued by the Secretary of Labor in 29 CFR 2520.104-23, the Plan is exempted from the reporting and disclosure provisions of Part 1 of Subtitle B of Title I of ERISA, except for providing plan documents to the Secretary of Labor upon request. Title IV of ERISA relating to plan termination insurance does not apply to the Plan, and insurance benefits of the type specified in Title IV of ERISA will not be extended to plan participants or their beneficiaries.
Available Information
The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the Exchange Act) and, in accordance therewith, files reports, proxy statements and other information with the Securities and Exchange Commission (the Commission). Copies of such reports, proxy statements and other information can be inspected and copied at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet worldwide web site that contains reports, proxy statements and other information about issuers who file electronically with the SEC. The address of that site is http://www.sec.gov. Copies of such material also can be obtained at the offices of the New York Stock Exchange, 20 Broad Street, New York, New York 10005, where the shares of the company's common stock are listed.
The Company hereby undertakes to provide without charge to each participant, upon written or oral request of such person to the company at the address set forth below, a copy of its most recent annual report to shareholders and the Plan's latest annual report on Form 11-K, as well as any and all information that has been incorporated by reference in the Registration Statement of which this document is a part, excluding exhibits to the information incorporated by reference unless such exhibits are specifically incorporated herein. Additional updating information with respect to the securities and the Plan covered herein may be provided in the future by means of updates to this document. Such written or oral request should be directed to:
International Paper Company
Attn: Investor Relations Department
400 Atlantic Street
Stamford, CT 06921
(203) 541-8000
The Company hereby incorporates by reference into this document the following documents filed with the Commission:
- The Company's latest Annual Report on Form 10-K;
- All other reports filed pursuant to Section 13(a) or 15(d) of the Exchange Act by the Company or by the Plan since the date of the Company's latest Annual Report on Form 10-K; and
- The description of the common stock of the Company contained in the Registration Statement filed pursuant to Section 12 of the Exchange Act relating thereto, including any amendment or report filed for the purpose of updating such description.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this document and before the termination of this offering of the Company's common stock will be deemed to be incorporated by reference into this document and to be part hereof from the date of filing of such documents.
The Company has registered with the Securities and Exchange Commission equivalent shares of International Paper Company common stock for plan investment.