Form 4: Clearwater Paper Director Receives Deferred Compensation in Phantom Stock Units

Clearwater Paper Corporation's Director, Jeanne M. Hillman, was granted 847.751 phantom stock units as part of her deferred compensation for quarterly retainer meeting fees.

Summary

• Jeanne M. Hillman, a Director of Clearwater Paper Corp (CLW), acquired 847.751 phantom stock units.
• The transaction date for this acquisition was July 1, 2025.
• Each phantom stock unit has a conversion or exercise price of $28.9.
• These units are credited to the reporting person's account under the Clearwater Paper Corporation Deferred Compensation Plan for Directors.
• The phantom stock units will be converted to cash and paid on a 1-for-1 basis with the issuer's common stock.
• The payment date for these units is January 1, 2031, or an earlier date previously elected by the reporting person.
• The acquired units represent deferred quarterly retainer meeting fees.
• Following this transaction, Jeanne M. Hillman beneficially owns a total of 7,365.103 phantom stock units.

Sentiment

Score: 7

Explanation: The filing reports a routine compensation event for a director, indicating ongoing engagement and alignment of interests with shareholders through a deferred compensation plan. This is a neutral to slightly positive event as it reflects standard corporate governance practices.

Positives

• The grant of phantom stock units aligns the director's financial interests with those of the shareholders, as the value of the compensation is tied to the company's stock performance.
• The deferred compensation plan provides a structured mechanism for director remuneration, contributing to stable corporate governance.

Future Outlook

Phantom stock units acquired by the director are scheduled to convert to cash and be paid on January 1, 2031, or an earlier elected date, in accordance with the company's deferred compensation plan.

Management Comments

• Phantom stock units are credited to the reporting person's account on the transaction date in accordance with the provisions of the Clearwater Paper Corporation Deferred Compensation Plan for Directors and will be converted to cash and paid on a 1-for-1 basis with the issuer's common stock.
• Phantom stock units will be converted to cash and paid on the date previously elected by the reporting person in accordance with the provisions of the Clearwater Paper Corporation Deferred Compensation Plan for Directors.
• Phantom stock unit beneficial ownership represents phantom stock allocated to the reporting person's Deferred Compensation Account since the reporting person's last report, representing deferred quarterly retainer meeting fees.

Industry Context

The use of phantom stock units as a form of deferred compensation for directors is a common practice across various industries, particularly in publicly traded companies. It serves to align the interests of board members with long-term shareholder value creation without immediate dilution of equity.

Comparison to Industry Standards

• The grant of phantom stock units as deferred compensation for director fees is a standard practice in corporate governance, comparable to compensation structures seen in other publicly traded companies of similar size and industry.
• Many companies, including those in the paper and forest products sector, utilize such plans to retain experienced board members and incentivize long-term performance, similar to how companies like International Paper or Packaging Corporation of America might structure non-executive director compensation.

Corporate Governance

Related Party Transactions

• The transaction involves the grant of phantom stock units to a director, Jeanne M. Hillman, which is a standard compensation arrangement between the company and a related party (board member) under a pre-existing deferred compensation plan.

Stakeholder Impact

• Shareholders: The grant of phantom stock units aligns the director's interests with shareholder value, as the compensation's ultimate value is tied to the company's stock performance.
• Director (Jeanne M. Hillman): Receives deferred compensation for services rendered, contributing to her overall remuneration package.

Next Steps

• The phantom stock units will be converted to cash and paid on January 1, 2031, or an earlier date elected by the reporting person.

Key Dates

Keywords

Clearwater Paper, CLW, Form 4, Insider Transaction, Director Compensation, Phantom Stock Units, Deferred Compensation Plan, Corporate Governance