8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (date of earliest event reported): December 14, 2005

American Greetings Corporation

(Exact Name of Registrant as Specified in its Charter)

Ohio	1-13859	34-0065325
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

One American Road Cleveland, Ohio	44144
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (216) 252-7300

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

EX-10.1 Supp Executive Retirement Plan

EX-10.2 Amend Key Management Annual Incent Plan

EX-10.3 Amend Deferred Comp Plan/Exec Third Party Option

EX-10.4 Outside Directors Deferred Comp Plan

EX-10.5 Agreement for Deferred Compensation Benefits

EX-10.6 Independent Contractor Agreement

Item 1.01 Entry into a Material Definitive Agreement

On December 14, 2005, the Board of Directors of American Greetings Corporation (“American Greetings”) authorized amendments to each of its Supplemental Executive Retirement Plan (the “SERP”), the Key Management Annual Incentive Plan for Fiscal Years 2005 and 2006, (the “Annual Incentive Plan”) and the Executive Deferred Compensation Plan. On December 14, 2005, the Board also adopted the Outside Directors’ Deferred Compensation Plan and American Greetings entered into a Consulting Agreement with one of its directors, Joseph S. Hardin, Jr.

Supplemental Executive Retirement Plan

The amendments to the SERP implement a number of changes designed primarily to address the new requirements imposed by the American Jobs Creation Act of 2004 (the “Act”). Specifically, the SERP was amended to define when the employment relationship ends for purposes of determining when covered executives will be paid compensation under the plan; make the process for payment of benefits more mechanical; delay payment of benefits for six (6) months if employment ends for reasons other than disability or death; and permit early payment in circumstances that would otherwise pose practical administrative problems, such as satisfying certain tax withholding obligations that arise before payments otherwise can be made. Executive officers and certain other officers of American Greetings participate in the SERP. A copy of the amendments to the SERP is included as an exhibit to this Current Report on Form 8-K.

Annual Incentive Plan

The amendments to the Annual Incentive Plan also were adopted to address the new requirements imposed by the Act and ensure that distributions under the Annual Incentive Plan fall within the short-term deferral rules and thus are not subject to the Act. In particular, the amendments clarify that any cash bonuses earned under the Annual Incentive Plan must be paid within two and one-half months following the end of American Greetings’ fiscal year in which the benefit being distributed is earned and clarify what constitutes a disability for purposes of determining when a distribution is to be paid to a participant on account of the participant becoming permanently disabled. Executive officers and certain other employees of American Greetings participate in the Annual Incentive Plan. A copy of the amendments to the Annual Incentive Plan is included as an exhibit to this Current Report on Form 8-K.

Executive Deferred Compensation Plan

Under the Executive Deferred Compensation Plan, a participant may elect to defer all or a portion of his or her annual salary, bonus and other compensation for a period of time. The Board adopted amendments to the Executive Deferred Compensation Plan primarily to address the new requirements imposed by the Act by, among other things,

• narrowing the conditions under which executives can further defer already-deferred compensation;

• limiting the matching and restoration contributions that will be credited to individual accounts;

• discontinuing the “option” portion of the plan under which participants were eligible to participate in selected mutual funds on a tax deferred basis;

• defining when the employment relationship ends for purposes of commencing to pay benefits;

• making the process for payment of benefits more mechanical;

• delaying payment of benefits for six (6) months if employment ends for a reason other than disability or death; and

• permitting early payment in circumstances that would otherwise pose practical administrative problems, such as when dividing built-up marital assets in a divorce or satisfying certain tax withholding obligations that arise before payments otherwise can be made.

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Executive officers and certain other officers of American Greetings may elect to participate in the Executive Deferred Compensation Plan. A copy of the amendments to the Executive Deferred Compensation Plan is included as an exhibit to this Current Report on Form 8-K.

Outside Directors’ Deferred Compensation Plan

Outside directors are currently eligible to defer compensation received in their capacity as directors of American Greetings. In connection with the amendments to the Executive Deferred Compensation Plan, American Greetings has adopted the Outside Directors’ Deferred Compensation Plan, which is intended to operate similar to the Executive Deferred Compensation Plan. Under the plan, Directors who are not also employees of American Greetings may elect to defer all or a portion of their compensation for a period of time, which deferred compensation will be paid out either in a lump sum or in installments over time, based on the participant’s election. The Outside Directors’ Deferred Compensation Plan is intended to be an unfunded plan for purposes of the Employee Retirement Income Security Act of 1974. A copy of the Outside Directors’ Deferred Compensation Plan is included as an exhibit to this Current Report on Form 8-K.

Consulting Arrangement

On December 14, 2005, American Greetings retained one of its Directors, Mr. Joseph S. Hardin, Jr., as an independent consultant pursuant to the terms of a consulting agreement, a copy of which is filed as an exhibit to this Current Report on Form 8-K. Under the terms of the consulting agreement, Mr. Hardin will provide certain general management and strategy consulting services. Mr. Hardin will receive a one-time retainer of $13,000 and will be paid a daily rate of $1,600 per day, plus expenses, based on services actually rendered. Either American Greetings or Mr. Hardin may terminate the consulting agreement at any time and for any reason. In accordance with the New York Stock Exchange rules, the Board of Directors has determined that the consulting arrangement with Mr. Hardin does not constitute a material relationship with American Greetings and that Mr. Hardin will continue to qualify as “independent” under the New York Stock Exchange rules.

Item 9.01 Financial Statements and Exhibits

(c) Exhibits

Exhibit
Number	Description
10.1	Amendment Number One to the American Greetings Corporation Supplemental Executive Retirement Plan
10.2	Amendment to Key Management Annual Incentive Plan for Fiscal Years 2005 and 2006
10.3	Amendment Number Four to the American Greetings Corporation Executive Deferred Compensation Plan and Amendment Number One to the American Greetings Corporation Executive Third Party Option Plan
10.4	American Greetings Corporation Outside Directors’ Deferred Compensation Plan
10.5	Form of Deferral Agreement under the American Greetings Corporation Outside Directors’ Deferred Compensation Plan
10.6	Independent Contractor Agreement, dated December 14, 2005, between American Greetings and Joseph S. Hardin, Jr.

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SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereto duly authorized.

American Greetings Corporation (Registrant)
By:	/s/ Catherine M. Kilbane
	Catherine M. Kilbane, Senior Vice
	President, General Counsel and Secretary

Date: December 19, 2005

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EX-10.1

EXHIBIT 10.1

Amendment Number One to the American Greetings Corporation

Supplemental Executive Retirement Plan

     WHEREAS, the American Greetings Corporation (the “Company”) currently maintains the American Greetings Corporation Supplemental Executive Retirement Plan (the “Plan”), which was originally adopted effective March 1, 1986 and which has subsequently been amended and restated effective March 1, 2004; and

     WHEREAS, the Company desires to amend the Plan to update its provisions in accordance with the American Jobs Creation Act of 2004, the applicable requirements of which are set forth in Internal Revenue Code (the “Code”) Section 409A, by virtue of the specific amendments to the Plan as set forth below; and

     WHEREAS, Section 8.4 of the Plan permits the Company to amend the Plan at any time, by action taken by its Board of Directors, and acting in its sole discretion, including those circumstances in which a change has occurred in the law (or in its interpretation) which would adversely affect the Company or a Participant if the Plan were to be left unamended;

     NOW, THEREFORE, the Plan is hereby amended as set forth below. Unless otherwise noted, all provisions of this Amendment Number One are effective January 1, 2005.

1. Article II, Definitions, is hereby amended by adding the definitions of “409A Disability,” “Code,” “Specified Employee,” and “Separation from Service” to the end thereof, and by amending the definitions of “Assumed Bonus Percentage,” “Board,” and “Company” in their entireties, as provided for below:

“2.3	Assumed Bonus Percentage shall mean, for any Fiscal Year, 50% of the Participant’s target bonus under the Company’s key management incentive plan, for which the Participant is eligible during any Fiscal Year, based on the Participant’s job classification. For this purpose, the schedule set forth by the Company’s Board for the various levels of job classifications covered by the Company’s key management incentive plan shall be used to calculate such awards.
2.5	Board shall mean the board of directors of AGCo (as defined herein); provided, that if the Board by resolution designates a person or a committee to act specifically on matters relevant to this Plan, such person or committee shall act (and have the power and authority to act) as the Board with respect to such matters.
2.8	Company shall mean American Greetings Corporation, an Ohio corporation (“AGCo”) and its controlled Subsidiaries and Affiliates; provided, that for Plan Years commencing after December 31, 2004, such term shall also include (to the extent not previously included in the preceding definition) any corporation, limited liability company, partnership, or other business organization which is part of a “controlled

group of corporations” that includes AGCo (within the meaning of Code Section 414(b) and related regulations), or is “under common control” with AGCo (within the meaning of Code Section 414(c) and related regulations).

2.21	Code shall mean the Internal Revenue Code of 1986, as amended from time to time. Any reference to a Code section shall include any regulations, notices, or rulings promulgated thereunder.
2.22	409A Disability shall mean a Participant’s absence from employment with the Company which: (i) is due to his or her inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months; or (ii) results from a medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, and causes such Participant to receive income replacement benefits for a period of not less than three (3) months under an accident and health plan covering the Company’s employees.
	Notwithstanding the foregoing, if the Company’s Long Term Disability Plan defines a Participant’s disability in accordance with the foregoing or, in the alternative, as determined by the Social Security Administration, then the definition of ‘409A Disability’ shall have the same meaning as the definition of ‘disability’ provided for under the Company’s Long Term Disability Plan.
2.23	Specified Employee shall mean any Participant for whom the following conditions, (a) and (b), are satisfied:

(a) at any time during the twelve (12) month period ending on the December 31st preceding the calendar year in which a given distribution is to occur, such Participant:

(i) is one of the top fifty (50) compensated officers of AGCo and has annual “W-2” compensation of at least One Hundred Thirty Thousand Dollars ($130,000); or

(ii) owns more than five percent (5%) of AGCo’s stock; or

(iii) owns more than one percent (1%) of AGCo’s stock and has annual “W-2” compensation in excess of One Hundred Fifty Thousand Dollars ($150,000); and

(b) AGCo’s stock is publicly traded on the date such Participant Separates from Service.

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In applying the above rules, the following shall apply: the foregoing compensation amounts shall be adjusted from time to time in accordance with the cost-of-living adjustments under Code Section 416(i); and an individual who qualifies as a Specified Employee under this Section 2.23 shall be treated as a Specified Employee for the twelve (12) month period beginning on the April 1st next following the date he or she so qualifies.

2.24 Separation from Service or “Separates from Service” shall mean a Participant’s termination from employment with the Company on account of such Participant’s death, permanent and total disability, retirement, or other such termination of employment. A Participant will not be deemed to have experienced a Separation from Service if such Participant is on military leave, sick leave, or other bona fide leave of absence, to the extent such leave does not exceed a period of six (6) months or, if longer, such longer period of time as is protected by either statute or contract. A Participant will not be deemed to have experienced a Separation from Service, if such Participant continues to provide “significant services” to the Company. For purposes of the preceding sentence, a Participant will be considered to provide “significant services” if such Participant provides continuing services that average at least twenty percent (20%) of the services provided by such Participant to the Company during the immediately preceding three (3) full calendar year of employment and the annual remuneration paid for such services is at least twenty percent (20%) of the average annual compensation earned during the final three (3) full calendar years of employment (or, if less, the period of employment).”

2. Section 3.3, Termination or Suspension of Participation; Renewed Participation, is hereby amended by adding a new subsection (d) to the end thereof, as follows:

          “(d) Notwithstanding the foregoing, in the event that a Participant commences employment with a Subsidiary or Affiliate that has its principal place of business located outside of the United States, but otherwise does not Separate from Service, such Participant will cease being an active Participant and stop accruing any benefit in the Plan until and unless such Participant (i) again performs services as an employee for AGCo, a Subsidiary or an Affiliate located within the United States, and (ii) is designated as an Executive eligible to participate in the Plan.

3. Section 4.1, Form of Accrued Benefit, is hereby amended by deleting the section in its entirety and replacing it with the following provision:

     “Form of Accrued Benefit. A Participant’s accrued benefit hereunder shall consist of a monthly benefit. Where paid as a Normal Retirement Benefit, such monthly benefit shall commence payment on the first day of the calendar month coincident with or next following the date such Participant attains his or her Normal Retirement Age, and shall be paid to such Participant as an annuity for life (with 180 monthly payments, guaranteed) (the “Accrued Benefit”).

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Where paid as a Late Retirement Benefit, such monthly benefit shall commence payment on the first day of the calendar month coincident with or next following the date such Participant Separates from Service, and shall be paid to such Participant as an annuity for life (with 180 monthly payments, guaranteed). Notwithstanding the foregoing, in the event the Participant is a Specified Employee, such Participant’s Normal Retirement Benefit or Late Retirement Benefit, as applicable, shall not commence payment until six (6) months after such Participant’s Separation from Service”

4. Section 5.1, Normal/Late Retirement Benefits, is hereby amended by deleting the section in its entirety and replacing it with the following provision:

“Normal/Late Retirement Benefit. A Participant shall be entitled to receive either a Normal Retirement Benefit or a Late Retirement Benefit, as applicable, commencing as of the first of the month next following the later of the date such Participant attains his or her Normal Retirement Age (“Normal Retirement”) or actually Separates from Service (“Late Retirement”). For purposes of this Plan, Normal Retirement Age shall mean a Participant’s attainment of age sixty-five (65). The Participant’s Normal Retirement Benefit or Late Retirement Benefit, as applicable, shall consist of his or her Accrued Benefit, determined as of the date of his Separation from Service.

Notwithstanding the foregoing, in the event the Participant is a Specified Employee, such Participant’s Normal Retirement Benefit or Late Retirement Benefit, as applicable, shall not commence payment until six (6) months after such Participant’s Separation from Service.”

5. Section 5.2, Early Retirement Benefit, is hereby amended by deleting the section in its entirety and replacing it with the following provision:

“Early Retirement Benefit. A Participant is eligible to receive an Early Retirement Benefit under the Plan, if such Participant Separates from Service and satisfies the criteria for obtaining an Early Retirement Benefit, as set forth below.

A Participant shall be eligible to receive an Early Retirement Benefit if such Participant Separates from Service and vests in his or her Accrued Benefit in accordance with Section 5.3, on the first day of the month coinciding with or next following:

(a)	the date such Participant attains age fifty-five (55) and completes at least ten (10) years of Service (at least five (5) of which must be completed while a Participant); or
(b)	any date certain, designated by the Board in writing by agreement with such Participant within thirty (30) days of such Participant first becoming eligible to participate in the Plan.

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Notwithstanding the foregoing, in the event a Participant is a Specified Employee and he or she is eligible for an Early Retirement Benefit due to his or her Separation from Service, such Participant’s Early Retirement Benefit shall not commence payment until six (6) months after such Participant’s Separation from Service.

The Early Retirement Benefit payable to a Participant who retires under this Section 5.2 shall be in an amount equal to such Participant’s Accrued Benefit, determined as of the date such Benefit commences payment hereunder, but reduced by the appropriate reduction factor specified in Schedule A (attached hereto).”

6. Section 5.3, Deferred Vested Benefit, is hereby amended by deleting the section in its entirety and replacing it with the following:

“Deferred Vested Benefit.

     A Participant’s right to an Accrued Benefit shall vest after completing ten (10) years of Service (at least five (5) of which is completed while a Participant), even though such Participant Separates from Service with the Company prior to the attainment of age fifty-five (55), so long as one (1) or more of the following events occurs after such Participant’s forty-fifth (45th) birthday:

(a) Such Participant’s Separation from Service results from unilateral action taken by the Company;

(b) Such Participant is a member of a class of Executives declared by written Board action to be ineligible to participate further in the Plan;

(c) Such Participant is demoted to non-Executive status by the Company; or

(d) A Change in Control occurs.

     Any Participant who vests hereunder (as provided above), but Separates from Service from the Company prior to attaining age fifty-five (55) nevertheless shall be eligible to commence receiving a Plan Benefit on the later of such Participant’s sixty-fifth (65th) birthday or the date such Participant Separates from Service. Notwithstanding the preceding sentence, a Participant, by special election made within thirty (30) days of first becoming eligible to participate in the Plan, may elect to have his/her Plan Benefit commence on the first of any calendar month commencing after such Participant’s fifty-fifth (55^th) birthday and prior to such Participant’s sixty-fifth (65^th) birthday (or if later, the first of the calendar month next following the date such Participant Separates from Service). The Accrued Benefit of a Participant who Separates from Service with the

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Company prior to attaining age fifty-five (55) shall be computed and frozen as of the date such Participant Separates from Service with the Company.

     The Plan Benefit actually payable to a Participant whose Accrued Benefit vests hereunder shall be determined in accordance with (i) Section 5.1 hereof, if such Participant commences receiving such Plan Benefit on or after attaining age sixty-five (65); or (ii) Section 5.2 hereof, if such Participant commences receiving such Plan Benefit prior to attaining age sixty-five (65) but on or after the date such Participant attains age fifty-five (55); provided, however, that such Plan Benefit shall be based on the above determination of the Participant’s Accrued Benefit.”

7. Section 5.4, Disability Retirement Benefit, is hereby amended by deleting the section in its entirety and replacing it with the following:

“Disability Retirement Benefit.

     A Participant who becomes disabled for purposes of the Long Term Disability Plan and, as a result, is eligible for and receiving benefits under the Long Term Disability Plan, may commence receiving a Disability Retirement Benefit on the later of the first day of the month coinciding with or next following:

(a) The date such Participant ceases to receive benefit payments under the Long Term Disability Plan; and

(b) (i) The date such Participant attains age sixty-five (65); or

 (ii) The date such Participant is found to have qualified for a 409A Disability (as herein defined).

     The Plan Benefit so payable to a Participant shall consist of such Participant’s Accrued Benefit, determined as of the date such Participant commenced receiving benefits under the Long Term Disability Plan, if any. In the event such Participant is not eligible to receive benefits under the Long Term Disability Plan, such Participant’s Accrued Benefit shall be determined as of the date such Participant is found to have qualified for a 409A Disability. Notwithstanding any contrary Plan provision, if a Participant is found to have qualified for a 409A Disability on or after attaining age fifty-five (55), but ceases to be so disabled before such Participant’s Disability Plan Benefit would have otherwise commenced, such Participant shall be eligible to receive an Early Retirement Benefit as provided under Section 5.2 herein.”

8. Section 7.3, Discretion to Accelerate, is hereby amended by deleting the first sentence therein in its entirety and replacing it with the following:

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“The Plan Administrator shall pay a Death Benefit in a single lump representing the present value of such Death Benefit, less applicable withholding, if the deceased Participant previously elected a lump sum payout within thirty (30) days of the commencement of his or her participation in the Plan.”

9. Section 9.7, Tax Withholding, is hereby amended by deleting the section in its entirety and replacing it with the following:

“Tax Withholding. Where and to the extent the accrual of Plan benefits by or for a Participant, and/or the payment and distribution of Plan rights or interests to a Participant or Beneficiary, results in employment taxes imposed under the Federal Income Contributions Act (“FICA”) with respect to such Participant’s Plan interest, or any related federal state or local income tax withholding obligation(s) to be imposed upon the Company or the Plan Administrator, or some other party (including without limitation, a participating Subsidiary or Affiliate), the Company (or such other party) shall have the right to withhold such amounts from any Plan benefit(s) due or becoming due and payable to such Participant or Beneficiary, and to the extent not unlawful, from any regular remuneration paid by the Company to a Participant.”

9. Article IX, General Provisions, is hereby amended by adding a new Section 9.10 to the end thereto, which shall provide as follows:

“9.10 Code Section 409A Compliance. The Plan is intended to be operated in compliance with the requirements of Code Section 409A (including any rulings or regulations promulgated thereunder). In the event that any provision of the Plan fails to satisfy such requirements, such provision shall be void and shall not apply to a Participant’s Deferred Compensation Benefit, to the extent practicable. In the event that it is determined not to be feasible to void a Plan provision as it applies to a Participant’s Deferred Compensation Benefit, such Plan provision shall be construed in a manner so as to comply with the requirements of Code Section 409A.”

     IN WITNESS HEREOF, the Company by action of its Board of Directors has caused this Amendment Number One to the Plan to be executed on this 14th day of December, 2005.

AMERICAN GREETINGS CORPORATION
By:	/s/ Brian T. McGrath
Name:  Brian T. McGrath
Title:  Vice President, Human Resources

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EX-10.2

EXHIBIT 10.2

AMENDMENT TO THE AMERICAN GREETINGS
KEY MANAGEMENT ANNUAL INCENTIVE PLAN

     This Declaration of Amendment is made this 14th day of December, 2005, by American Greetings Corporation (the “Corporation”):

WITNESSETH THAT:

     WHEREAS, the Corporation has previously adopted the American Greetings Key Management Annual Incentive Plan for Fiscal Years 2005 and 2006 (collectively, the “Annual Incentive Plan”);

     WHEREAS, certain amendments to the Annual Incentive Plan are required to bring the Annual Incentive Plan into compliance with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), including the regulations and notices promulgated thereunder;

     WHEREAS, the Annual Incentive Plan provides that distributions will typically be paid to Annual Incentive Plan participants within 60 days after the end of the fiscal year, and the Corporation desires to amend the Annual Incentive Plan by requiring the Annual Incentive Plan administrator to make such distributions within two and one-half months following the end of the Corporation’s fiscal year in which the benefit being distributed is earned;

     WHEREAS, the Corporation intends for Annual Incentive Plan distributions to comply with the short-term deferral rules of Code Section 409A;

     WHEREAS, the Annual Incentive Plan permits a distribution to be paid on account of a participant becoming permanently disabled, but the Annual Incentive Plan does not make clear what constitutes a disability, and the Corporation desires to amend the Annual Incentive Plan by clearly defining what may constitute a disability for distribution purposes in a manner consistent with Code Section 409A;

     WHEREAS, the Board of Directors of the Corporation has approved the amendments to the Annual Incentive Plan contemplated hereby.

     NOW, THEREFORE, BE IT RESOLVED, that the Corporation hereby amends the Annual Incentive Plan, to be effective as of January 1, 2005 (the “Effective Date”), to (i) clarify that the Annual Incentive Plan administrator pay Annual Incentive Plan benefits within two and one-half months following the end of the Corporation’s fiscal year in which the benefit is earned; and (ii) clarify the Corporation’s intent to have such distributions fall under the short-term deferral rules of Code Section 409A, to exempt the payment of such Annual Incentive Plan benefits from the requirements of Code Section 409A.

     FURTHER RESOLVED, that the Corporation hereby amends Annual Incentive Plan, to be effective as of the Effective Date, to provide that an employee will be deemed to be

“Disabled” under the Annual Incentive Plan and, therefore, eligible for a distribution of his or her Annual Incentive Plan benefits only in the following circumstances: (A) where an employee is absent from employment with the Corporation due to his or her inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment, which either can be expected to result in death, or can be expected to last for a continuous period of not less than twelve (12) months; or (B) where an employee is scheduled to receive income replacement benefits for a period of not less than three (3) months under an accident and health plan covering the Corporation’s employees on account of a medically determinable physical or mental impairment that can be expected to result in death or last for a continuous period of not less than twelve (12) months.

     IN WITNESS WHEREOF, this Plan amendment has been executed as of this 14^th Day of December 2005.

American Greetings Corporation
By:	/s/ Zev Weiss
Name: Zev Weiss
Title: Chief Executive Officer

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EX-10.3

EXHIBIT 10.3

Amendment Number Four to the American Greetings Corporation
Executive Deferred Compensation Plan
and
Amendment Number One to the American Greetings Corporation
Executive Third Party Option Plan

     WHEREAS, the American Greetings Corporation (the “Company”) currently maintains the American Greetings Corporation Executive Deferred Compensation Plan (the “Plan”), which was adopted effective October 26, 1993; and

     WHEREAS, the Plan was amended thrice, the third time to establish the American Greetings Corporation Executive Third Party Option Plan (the “Option Plan”; both the Option Plan and the Plan are hereinafter collectively referred to as the “Plans”) and to segregate the Option Plan into a separate amendment to the Plan; and

     WHEREAS, the Company desires to amend the Plan and the Option Plan to update their provisions in accordance with the American Jobs Creation Act of 2004, the applicable requirements of which are set forth in Internal Revenue Code (the “Code”) Section 409A, by virtue of specific amendments to the Plan; and

     WHEREAS, the Company wishes to freeze the Option Plan, effective January 1, 2005, to prohibit the further issuance of options thereunder, but to permit those options earned and vested as of December 31, 2004, to remain subject to the Plans’ terms in effect at that time, while subjecting any options not earned and vested as of that date to the rules established by Code Section 409A, which are incorporated into the Plans by virtue of this Amendment Number Four; and

     WHEREAS, Section 10.1 of the Plan and Section 20 of the Option Plan permit the Company to amend the Plan and the Option Plan at any time at the Board of Director’s discretion;

     NOW, THEREFORE, the Plan and the Option Plan are hereby amended as set forth below. Unless otherwise noted, all provisions of this amendment are effective January 1, 2005.

A. Amendments to the Plan

1.	Section 2.1, Definitions, is hereby amended by deleting the definitions of “Disability,” “Employer,” and “Unforeseeable Emergency” and replacing them in their entirety with the following:
	“‘Disability,’ or ‘Disabled’ means the following, in the following contexts and circumstances:

(i) With respect to Participants’ Deferred Compensation Benefits and Restoration Benefits that are earned and vested prior to December 31, 2004, a physical or

mental condition of a Participant resulting from a bodily injury, disease, or mental disorder which renders him incapable of continuing in the employment of the Employer, as determined by the Administrator based upon appropriate medical advice and examination; and

(ii) With respect to Participants’ Deferred Compensation Benefits and Restoration Benefits that are earned or vest after December 31, 2004, a Participant’s absence from employment with the Employer due to: (A) his inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which either can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months; or (B) a medically determinable physical or mental impairment which can be expected to result in death or last for a continuous period of not less than twelve (12) months, for which such Participant is scheduled to receive income replacement benefits for a period of not less than three (3) months under an accident and health plan covering the employees of such Employer.”

“‘Employer’ means American Greetings Corporation, an Ohio corporation (“AGCo”) and its controlled subsidiaries and affiliates; provided, that for Plan Years commencing after December 31, 2004, such term shall also include (to the extent not previously included in the preceding definition) any corporation, limited liability company, partnership, or other business organization which is part of a “controlled group of corporations” that includes AGCo (within the meaning of Code Section 414(b) and related regulations), or is “under common control” with AGCo (within the meaning of Code Section 414(c) and related regulations).”

“‘Unforeseeable Emergency’ means:

(i) With respect to Participants’ Deferred Compensation Benefits and Restoration Benefits that are earned and vested prior to December 31, 2004, an unanticipated emergency that is caused by an event beyond the control of the Participant and that would result in severe financial hardship to the individual if early withdrawal were not permitted; and

(ii) With respect to Participants’ Deferred Compensation Benefits and Restoration Benefits that are earned or vest after December 31, 2004, any of the following:

(A) a severe financial hardship to the Participant, resulting from an illness or accident of the Participant, the Participant’s spouse or the Participant’s dependent (as defined under Code Section 152(a));

(B) loss of the Participant’s property due to casualty; or

(C) other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the Participant’s control.”

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2. Section 2.1, Definitions, is hereby amended by adding the following definitions thereto in the proper alphabetical sequence:

“‘Specified Employee’ means any individual employed by the Employer for whom both (i) and (ii) apply:

(i) at any time during the twelve (12) month period ending on the December 31st preceding the Plan Year under consideration, such individual:

(A) is one of the top fifty (50) compensated officers of AGCo and has annual “W-2” compensation of at least $130,000; or

(B) owns more than five percent (5%) of AGCo’s stock; or

(C) owns more than one percent (1%) of AGCo’s stock and has annual “W-2” compensation in excess of One Hundred Fifty Thousand Dollars ($150,000); and

(ii) AGCo’s stock is publicly-traded on the date such individual Separates from Service.

In making the above determinations, the foregoing compensation amounts shall be adjusted from time to time in accordance with the cost-of-living adjustments under Code Section 416(i), and an individual who qualifies as a Specified Employee under part (i) hereof shall be treated as a Specified Employee for the twelve (12) month period beginning on the April 1st next following the date he so qualifies.”

“‘Separation from Service’ or ‘Separates from Service’ shall mean a Participant’s termination from employment with the Employer on account of such Participant’s death, permanent and total disability, retirement, or other such termination of employment. A Participant will not be deemed to have experienced a Separation from Service if such Participant is on military leave, sick leave, or other bona fide leave of absence, to the extent such leave does not exceed a period of six (6) months or, if longer, such longer period of time as is protected by either statute or contract. A Participant will not be deemed to have experienced a Separation from Service if such Participant continues to provide “significant services” to the Employer. For purposes of the preceding sentence, a Participant will be considered to provide “significant services” if such Participant provides continuing services that average at least twenty percent (20%) of the services provided by such Participant to the Employer during the immediately preceding three (3) full calendar year of employment and the annual remuneration paid for such services is at least twenty percent (20%) of the average annual compensation earned during the final three (3) full calendar years of employment (or, if less, the period of employment).”

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3. Section 3.3(d), Agreement Procedure, is hereby deleted in its entirety and replaced with the following:

“(d) The deferral period provided for under a prior Agreement (the ‘Prior Deferral Election’) may be extended in accordance with rules established by the Administrator in compliance with the requirements of Code Section 409A and related regulations. Notwithstanding the foregoing, in no event shall a change in a Prior Deferral Election:

     (i) take effect until at least twelve (12) months after the date on which such Election is made;

     (ii) permit payment due on account of Separation from Service, or payable in accordance with a specified time or fixed schedule (as set forth in such Agreement), or payable in connection with a Change in Control, to commence earlier than five (5) years from the date such payment otherwise would have commenced in the absence of such extension, and

     (iii) permit payment to commence in accordance with a specified time or fixed schedule set forth in the Prior Deferral Election less than twelve (12) months prior to the date of the first payment scheduled under such Prior Deferral Election.

For purposes of this paragraph (d), any payments to be made to a Participant under a prior Agreement that consists of installments, or is to be paid other than in lump sum form, shall be treated as a single payment, and the date of the first payment in any such series of installments shall be treated as the date of payment.

4. Section 4.4, Matching Contributions, is hereby amended by adding the following provision to the end thereto:

“Notwithstanding the foregoing, effective January 1, 2005, no Employer Matching Contribution shall be credited to any Participant who is otherwise eligible to receive an Employer Matching Contribution, to the extent such Employer Matching Contribution corresponds to changes made by such Participant to his or her elective deferrals in the American Greetings Corporation Employees’ Profit Sharing Plan and such changes to his or elective deferrals exceeds the Code Section 402(g) limit.”

5. Section 5.3, Restoration Contributions, is hereby deleted in its entirety and replaced with the following:

“An amount determined by the Board, in its sole discretion, may be credited to a Participant’s Account for each Plan Year in which the Participant is a participant

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in the American Greetings Corporation Employees’ Retirement Profit Sharing Plan, and contributions allocated to such Participant’s account(s) thereunder, if any, are restricted due to the limitations imposed under Code Sections 401(a)(17) and 415.”

6. Section 6.1, Commencement of Benefit Payments, is hereby deleted in its entirety and replaced with the following:

“6.1  Commencement of Benefit Payments. With respect to Participants’ Deferred Compensation Benefits and Restoration Benefits that are earned and vested prior to December 31, 2004, and except as provided in Section 10.8, the payment of a Participant’s Deferred Compensation Benefit and Restoration Benefit shall commence within thirty (30) days after the date on which the earlier of the following events occur, as applicable:

(a)	The expiration of the deferral period provided under such Participant’s Agreement;
(b)	Such Participant incurs an Unforeseeable Emergency (as determined by the Administrator in accordance with the Plan), provided, that a payment made in accordance with this provision (b) shall in any event be limited to the amount necessary to satisfy such emergency;
(c)	Such Participant terminates service with the Employer for any reason; or
(d)	Such Participant’s service is terminated by the Employer for any reason.

With respect to Deferred Compensation Benefits and Restoration Benefits earned or vesting after December 31, 2004, and except as provided in Section 10.8, a Participant’s Deferred Compensation Benefit and Restoration Benefit shall commence after the date on which the earliest of the following events occur, as applicable:

(a)	The expiration of the deferral period provided under such Participant’s Agreement,
(b)	Such Participant incurs an Unforeseeable Emergency (as determined by the Administrator in accordance with the Plan), provided, that a payment made in accordance with this provision (b) shall in any event be limited to the amount necessary to satisfy such emergency; or
(c)	Such Participant incurs a Separation from Service.

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Notwithstanding the foregoing, in the case of any distribution payable on account of a Separation from Service to any Participant who qualifies as a Specified Employee (determined as of such Separation from Service), any such distribution shall commence no earlier than six (6) months from the date of such Separation from Service (or if earlier, the date of such Specified Employee’s death).”

7. Section 6.2, Form of Benefit Payments, is hereby amended by deleting the last paragraph in its entirety and by deleting the second to last paragraph in its entirety, but replacing it with the following:

“Except as provided in Article VII, the Participant’s Restoration Benefit shall be paid in a single lump sum unless a periodic payment is elected by the Participant under procedures established by the Administrator. For Restoration Benefits credited or vesting after December 31, 2004, any election to receive a periodic payment under this Section 6.2 shall be made no later than: (i) the last day of the Plan Year preceding the Plan Year to which such Restoration Benefit is first credited; or (ii) in the case of the first year in which a Participant becomes eligible to participate in the Plan, not later than thirty (30) days from the date that such Participant first becomes eligible to participate in the Plan.”

8. Section 10.3, No Assignment, is hereby amended by adding the following paragraph to the end thereto:

“Notwithstanding the foregoing, a Participant’s Deferred Compensation Benefit shall be subject to division and partition in accordance with the terms of a domestic relations order satisfying the requirements of a “qualified domestic relations order” (“QDRO”), as defined in Code Section 414(p) and related regulations; provided, that (i) a separate benefit shall be recognized and maintained for any spouse or former spouse determined to have an interest in the Plan as a result of a QDRO; and (ii) all costs and expenses incurred by the Company or the Administrator in connection with such QDRO shall be charged against such Participant’s Deferred Compensation Benefit, as an offset in accordance with the provisions of subsection (c) hereof, prior to effecting any such division or partition.”

9. Article 10, Miscellaneous Provisions, is hereby amended by adding Section 10.12 to the end thereto, which shall provide as follows:

“Section 10.12 Tax Liability; Compliance.

(a) Where and to the extent a Participant’s Deferred Compensation Benefit, including any payment or distribution thereunder, results in a federal, state or local tax withholding obligation being imposed upon the Company or the Administrator, or any entity qualifying as an “Employer”

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hereunder, the Company (or such Employer) shall have the right to withhold such amounts from any Plan benefit(s) due or becoming due and payable to such Participant.

(b) The Administrator may treat as paid, and then withhold and remit, a portion of a Participant’s Deferred Compensation Benefit reasonably determined to be necessary to satisfy any federal, state, or local tax obligation imposed in connection with such Participant’s Deferred Compensation Benefit; provided, however, that any amount treated as paid to a Participant and so applied shall not exceed the amount of such obligation.

(c) The Plan is intended to be operated in compliance with the provisions of Code Section 409A (including any rulings or regulations promulgated thereunder). In the event that any provision of the Plan fails to satisfy the provisions of Code Section 409A, then such provision shall be void and shall not apply to a Participant’s Deferred Compensation Benefit, to the extent practicable. In the event that it is determined to not be feasible to so void a Plan provision as it applies to a Participant’s Deferred Compensation Benefit, such Plan provision shall be construed in a manner so as to comply with the requirements of Code Section 409A.”

B. Amendments to the Option Plan

1. Section 2, Provision to Amend Deferral Plan, is hereby amended by deleting the section in its entirety and replacing it with the following:

“2.

Provision to Amend Deferral Plan. In accordance with §10.1 of the Deferral Plan, Participants who otherwise have an opportunity to extend the deferral period for amounts deferred under rules adopted pursuant to §3.3(d) of the Deferral Plan may elect instead to receive an award of discounted options hereunder (“Option Agreement”) in full satisfaction of such amounts due under the Deferral Plan. As a condition to such Option Agreement, any Participant who becomes a party thereto shall consent and agree that he or she no longer has any right to such amounts under the Deferral Plan. The Options awarded in substitution of the Deferred Compensation Benefit shall be governed by the terms of this Plan, except with respect to the timing of the Options’ elections, which at all times shall be governed by §3.3(d) of the Deferral Plan.

The Board of Directors (or the Compensation & Management Development Committee, to the extent delegated), shall have sole discretion to provide Participants in the Deferral Plan the opportunity to substitute their rights to receive deferred compensation under the Deferral Plan for the right to enter into an Option Agreement pursuant to this Plan,

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provided the participant makes his or her election prior to the beginning of the Deferral Period.

Notwithstanding the foregoing, effective January 1, 2005, Participants shall no longer be eligible to enter into Option Agreements hereunder, or to amend or modify any existing Option Agreements. Further, any Option Agreements executed prior to October 4, 2004, shall be subject to the terms of the Deferral Plan in effect prior to that date. Any Option Agreements executed on or after October 4, 2004, shall be subject to the terms of the Deferral Plan, as thereafter amended and in effect.”

2. Section 4, Definitions, is hereby amended by adding the definition of Deferral Period thereto and replacing the current definition “Termination of Employment” with the following:

“‘Deferral Period’ shall mean the period for which a Participant’s compensation is deferred under the Deferral Plan. The Deferral Period will be measured against the Deferral Plan’s Plan Year.”

“‘Termination of Employment’ shall mean, with respect to Employee terminations occurring prior to January 1, 2005, the date on which the Employee ceases to perform services for the Company. Effective for Employee’s terminations occurring after December 31, 2004, ‘Termination of Employment’ shall mean the date of an Employee’s Separation from Service as defined under the Deferral Plan.”

3. Section 7, Eligibility, is hereby amended by replacing the section in its entirety with the following:

“All Employees of the Company who are both in the group of Employees determined by the Board to be part of the select group of management or highly compensated Employees and are also designated as Participants by the Board are eligible to receive Options under the Plan. Notwithstanding the foregoing, no Option Agreement shall be entered into under this Plan after December 31, 2004.”

4. Section 8, Grant of Options, is hereby amended by adding the following provision to the end thereto:

“No Option Agreement shall be entered into under this Plan after December 31, 2004.”

5. Section 11 is hereby amended by deleting the section in its entirety and replacing it with the following:

“Exercise. Except as otherwise specifically provided in the Option Agreement, all Options granted under the Plan will vest at grant and may be exercisable

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immediately; provided, however, that such Options shall be exercised in accordance with the applicable Option Agreement.

The Option may be exercised, as provided in the Option Agreement, in full or in part from the date of the grant at increments of no less than 100% of each grant. However, in no event shall any option be exercised more than 20 years after the date of grant, with the option to extend the exercise period at the discretion of the Board; provided, however, that no extensions shall be permitted after December 31, 2004.

Reinvested dividends shall be attributed proportionally to the property subject to the Option awards and will be purchased when the underlying award is exercised. For example, if an original grant of an Option to purchase 400 shares (after the payment of the exercise price) generated 100 additional shares on such 400 shares from reinvested dividends, an exercise of one-fourth of the originally granted options will result in the purchase (after the payment of the exercise price) of 125 shares in order to proportionally include the resulting reinvested dividends.

In addition, all Options granted under the Plan may only be exercised subject to the terms specified in the Option Agreement. If such terms conflict with the terms of this Plan, the terms of this Plan Document shall control.”

6. Section 16, Modification of Option or Plan, shall be amended by adding the following provision to the end thereto:

“Effective January 1, 2005, the Board shall not modify, extend, or renew any outstanding Option or the Plan, except as may be required to bring such Option Agreement or the Plan into compliance with applicable federal, state, or local law.”

     IN WITNESS HEREOF, the Company, by actions of its Board of Directors, has caused this Amendment Number Four to the Plan and this Amendment Number One to the Option Plan to be executed on this 14^th day of December, 2005.

AMERICAN GREETINGS CORPORATION
By:	/s/ Brian T. McGrath
Name: Brian T. McGrath
Title: Vice President, Human Resources

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EX-10.4

EXHIBIT 10.4

AMERICAN GREETINGS CORPORATION
OUTSIDE DIRECTORS’ DEFERRED COMPENSATION PLAN

AMERICAN GREETINGS CORPORATION
DIRECTORS’ DEFERRED COMPENSATION PLAN

Table of Contents

	Page
ARTICLE I INTRODUCTION		1
Section 1.1 Name of Plan		1
Section 1.2 Effective Date		1
Section 1.3 Purpose		1
ARTICLE II DEFINITIONS AND USAGE		1
Section 2.1 Definitions		1
Section 2.2 Usage		3
ARTICLE III ELIGIBILITY AND PARTICIPATION		3
Section 3.1 Eligibility		3
Section 3.2 Participation		3
Section 3.3 Agreement Procedure		3
Section 3.4 Deferral Period		4
Section 3.5 Termination of Suspension of Participation; Renewed Participation		4
ARTICLE IV DEFERRED COMPENSATION BENEFIT		4
Section 4.1 Deferred Compensation Benefit		4
Section 4.2 Accounts		4
Section 4.3 Director’s Contributions		5
Section 4.4 Investments		5
Section 4.5 Valuation of Accounts		5
ARTICLE V PAYMENT OF BENEFIT PRIOR TO DEATH OR DISABILITY		5
Section 5.1 Commencement of Benefit Payments		5
Section 5.2 Form of Benefit Payments		5
Section 5.3 In-Kind Payments		6
ARTICLE VI PAYMENT OF BENEFIT ON OR AFTER DEATH OR DISABILITY		6
Section 6.1 Commencement of Benefit Payments		6
Section 6.2 Designation of Beneficiary		6
Section 6.3 Disability Determinations		6

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AMERICAN GREETINGS CORPORATION
DIRECTORS’ DEFERRED COMPENSATION PLAN

Table of Contents

	Page
ARTICLE VII ADMINISTRATION		6
Section 7.1 General		6
Section 7.2 Administrative Rules		6
Section 7.3 Duties		7
Section 7.4 Fees		7
ARTICLE VIII MISCELLANEOUS PROVISIONS		7
Section 8.1 Amendment		7
Section 8.2 Termination		7
Section 8.3 No Assignment		8
Section 8.4 Successors		8
Section 8.5 Governing Law		8
Section 8.6 No Guarantee of Position		8
Section 8.7 Severability		8
Section 8.8 Code Section 409A Compliance		8

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AMERICAN GREETINGS CORPORATION OUTSIDE DIRECTORS’ DEFERRED
COMPENSATION PLAN

ARTICLE I
INTRODUCTION

Section 1.1 Name of Plan. This plan shall be known as the American Greetings Corporation Outside Directors’ Deferred Compensation Plan (hereinafter referred to as the “Plan”).

Section 1.2 Effective Date. The Plan’s effective date is January 1, 2005.

Section 1.3 Purpose. American Greetings Corporation has established the Plan to provide certain members of that company’s board of directors the option of deferring the receipt of fees earned while serving in such capacity.

ARTICLE II
DEFINITIONS AND USAGE

Section 2.1 Definitions. For purposes of this Plan, capitalized terms have the meanings set forth below:

“Account” means the individual account or accounts established on behalf of a Participant in accordance with Section 4.2.

“Administrator” means the person or persons described in Article VII.

“Affiliate” means any limited liability company, general partnership, limited partnership, business trust, or other non-corporate organization with respect to which American Greetings Corporation directly or indirectly owns at least fifty percent (50%) of either the capital or profits interest therein, and directly or indirectly has the power and authority to select and appoint, and where applicable remove, such organization’s managers, general partner(s) and/or trustees (as applicable).

“Agreement” means an Agreement for Deferred Compensation Benefits entered into between the Company and a Director who is eligible to participate in the Plan.

“Board” means the Board of Directors of American Greetings Corporation; provided that, if such Board, by resolution, designates a person or a committee to act specifically on matters relevant to the Plan, such person or committee shall act (and have the power and authority to act) as the Board with respect to such matters.

“Code” means the Internal Revenue Code of 1986, as amended. Any reference to a section of the Code shall include any regulations or rulings promulgated thereunder.

“Company” means American Greetings Corporation, an Ohio corporation (“AGCo”), together with any corporation, limited liability company, partnership, or other business organization which is part of a “controlled group of corporations” that includes AGCo (within the meaning of

Code Section 414(b) and related regulations), or is “under common control” with AGCo (within the meaning of Code Section 414(c) and related regulations).

“Compensation” means the total of all retainer fees, meeting fees, and any other fees for personal services rendered by a Director for the Company, acting in that capacity, whether paid to the Director in cash or in-kind. Compensation shall not include, for purposes of determining a Director’s Deferred Compensation Benefit under the Plan, any remuneration received by such Director for services he or she renders to the Company in the capacity of an independent contractor.

“Deferred Compensation Benefit” means the benefit of a Participant as determined under Article IV of this Plan.

“Director” means any person serving as an “outside director” on the Board. An “outside director” is any individual performing personal services as a member of the Board who does not concurrently perform services for the Company as an Employee; provided, however, that a Director may include an “outside director” who concurrently performs services for the Company as an independent contractor.

“Disability” or “Disabled” means a Participant’s absence from service on the Company’s Board due to: (i) his or her inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months; or (ii) such medically determinable physical or mental impairment, which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, for which the Participant is receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering the Company’s Directors.

“Employee” shall mean any individual employed by the Company who receives “W-2 wages” from the Company. Any individual who provides personal services to the Company concurrently as both Employee and Director shall not be considered a Director, while serving in such dual capacities.

“Participant” means a Director who is eligible to participate in the Plan and who is actually participating in the Plan in accordance with Section 3.2.

“Plan” means the American Greetings Corporation Outside Directors’ Deferred Compensation Plan.

“Plan Year” means the calendar year.

“Separation from Service” shall mean a Participant’s resignation, removal or withdrawal as a Director (whether on account of such Participant’s death, permanent and total disability, retirement, or other circumstances). A Participant will not be deemed to have experienced a Separation from Service if such Participant commences employment with the Company as an Employee, or otherwise continues to provide “significant services” to the Company. For purposes of the preceding sentence, a Participant will be considered to provide “significant services” if such Participant provides continuing services that average at least twenty percent

2

(20%) of the services provided by such Participant to the Company during the immediately preceding three (3) full calendar years and the annual remuneration paid for such services is at least twenty percent (20%) of the average annual compensation earned during the final three (3) full calendar years (or, if less, the period of service).

“Subsidiary” means any corporation at least eighty percent (80%) of whose equity securities (determined either by voting power or by interest in profits) are directly or indirectly owned by AGCo.

“Unforeseeable Emergency” means any of the following: (i) a severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Participant’s spouse or the Participant’s dependent (as defined under Code Section 152(a)), (ii) loss of the Participant’s property due to casualty, or (iii) other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the Participant’s control as determined by the Administrator pursuant to Code Section 409A.

Section 2.2 Usage. Except where otherwise indicated by the context, any masculine terminology used herein shall also include the feminine and vice versa, and the definition of any term herein in the singular shall also include the plural and vice versa.

ARTICLE III
ELIGIBILITY AND PARTICIPATION

Section 3.1 Eligibility. A Director shall be eligible to participate in the Plan on the day he or she first serves as a Director of AGCo, unless the Board, by written action, otherwise designates such Director as ineligible to participate in the Plan.

Section 3.2 Participation. Each Director eligible to participate in the Plan in accordance with Section 3.1 shall become a Participant by entering into an Agreement with AGCo. Each Director’s participation in the Plan shall be governed by his or her Agreement, including the effective date of each Director’s participation, and the terms of the Plan. In the event that the terms of the Agreement and the terms of the Plan conflict, the terms of the Agreement control.

Section 3.3 Agreement Procedure.

(a) AGCo and each Director who is eligible to participate in the Plan may execute one or more Agreements for all or a the portion of Compensation the Director elects to defer into the Plan. Each Agreement shall provide for the amount credited to a Participant’s Account in accordance with Section 4.3 below, the period of deferral in accordance with rules established by the Administrator, the investment of such amount in accordance with Section 4.4 below, and the payment of the Participant’s Deferred Compensation Benefit in accordance with Sections 5.1 and 5.2 below.

(b) For the initial Plan Year in which a Director becomes eligible to participate in the Plan, the Agreement shall be properly completed, executed and delivered to the Administrator prior to the date that ends thirty (30) days after the date on which the Director first becomes eligible to participate in the Plan.

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(c) For any subsequent Plan Year for which a Director is eligible to participate in the Plan, the Agreement shall be properly completed, executed and delivered to the Administrator prior to the first day of each Plan Year for which amounts will be deferred on behalf of such Director.

(d) An Agreement shall be effective no earlier than the date on which it is delivered to the Administrator and shall continue in effect for all succeeding Plan Years until the Deferred Compensation Benefit attributable to such Agreement has been paid, unless otherwise provided under the Plan.

Section 3.4 Deferral Period.

(a) A Participant may elect to defer his or her Compensation for three (3) years, five (5) years, or until the date such Participant no longer performs personal services as a Director. A Participant must select a deferral period on the Agreement he or she enters into with the Company before any Compensation will be deferred under the Plan on such Participant’s behalf.

(b) A deferral period provided for under a prior Agreement (the ‘Prior Deferral Election’) may be extended in accordance with rules established by the Administrator. Notwithstanding the foregoing, in no event shall a change in a Prior Deferral Election (i) take effect until at least twelve (12) months after the date on which the election to change is made, (ii) permit a payment on account of Separation from Service or in accordance with a specified time or fixed schedule (as set forth on the Agreement) to commence earlier than five (5) years from the date the initial payment under the Prior Deferral Election would otherwise have been made, and (iii) permit a payment in accordance with a specified time or fixed schedule of the Prior Deferral Election (as set forth on the Agreement) to occur earlier than twelve (12) months prior to the date of the first scheduled payment under the Prior Deferral Election.

Section 3.5 Termination or Suspension of Participation; Renewed Participation. A Participant’s future participation in the Plan may be discontinued at any time by written action of the Board, in accordance with and subject to the following rules:

(a) The terms of any discontinuance must be set forth in writing and a copy of these written terms shall be provided to the affected Participant, the Plan Administrator, and the Board.

(b) In the event that a Participant, whose future participation in the Plan is discontinued, is again designated for participation in the Plan by the Board, such Participant must enter into an Agreement in accordance with Section 3.3(c) above.

ARTICLE IV
DEFERRED COMPENSATION BENEFIT

Section 4.1 Deferred Compensation Benefit. A Participant’s Deferred Compensation Benefit shall be equal to the total amount credited to the Participant’s Account under this Article IV.

Section 4.2 Accounts. The Company shall establish and maintain Accounts on behalf of each Participant, which shall include all Deferred Compensation Benefits deferred on behalf of such Participant. Each Account shall list and reflect each Participant’s credits and valuations. All amounts credited to a Participant’s Account shall be entered as of the date on which the

4

Compensation would have been paid had it not been deferred. At all times prior to the distribution of all or a portion of amounts maintained in a Participant’s Account, amounts so credited shall represent a general unsecured obligation of the Company subject to the claims of the Company’s general creditors.

Section 4.3 Director’s Contributions. Directors who have been identified by the Board as eligible to participate in the Plan shall be eligible to elect to defer all or a portion of his or her Compensation under the Plan, which may be communicated as a certain percentage or set dollar amount. The terms of any election to defer a Director’s Compensation must be made in accordance with Sections 3.3(b) and 3.3(c) above. Further, the timing and form of payment of such Deferred Compensation Benefit must be specified in the Agreement, subject to the provisions of Sections 3.3(d), 5.1, 5.2 and 6.1.

Section 4.4 Investments. A Participant may elect, at the time and in the manner he or she makes an initial deferral election, the vehicles in which assets held in his or her Account will be invested. The Company will provide a Participant, as part of his or her Agreement, a choice of investment vehicles, which have been pre-selected by the Board. In the event all or a portion of a Participant’s Account is not invested pursuant to the Agreement, such Participant’s Account shall be invested as reasonably determined by the Company, in accordance with the procedures established by the Administrator. A Participant may elect to change his or her investment elections in accordance with procedures established by the Administrator.

Section 4.5 Valuation of Accounts. The value of a Participant’s Account shall be determined from time to time by the Administrator in the following manner:

(a) Each Participant’s Account shall be valued as of the last day of each Plan Year, or more frequently as agreed upon by the Administrator, and shall again be valued as of the date that a Participant receives a payment under the Plan, in accordance with the procedures established by the Administrator.

(b) All allocations to a Participant’s Account under this Section 4.5 shall be deemed to have been made on the applicable valuation date, even though actually determined at a later date.

ARTICLE V
PAYMENT OF BENEFIT PRIOR TO DEATH OR DISABILITY

Section 5.1 Commencement of Benefit Payments. Except as provided in Section 6.1 below, the payment of a Participant’s Deferred Compensation Benefit shall commence thirty (30) days after the date on which the earlier of the following events occurs:

(a) The expiration of the deferral period provided under the Participant’s Agreement.

(b) The Participant incurs an Unforeseeable Emergency (as determined by the Administrator in accordance with the Plan’s terms).

(c) The Participant experiences a Separation from Service with the Company for any reason.

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Section 5.2 Form of Benefit Payments. Except as provided in Article VI, a Participant shall be given the option to elect to receive his or her Deferred Compensation Benefit as (a) one lump sum payment, (b) installments, payable over a period of five (5) years, or (c) installments, payable over a period of ten (10) years. The form that a Participant’s Deferred Compensation Benefit will be paid in, must be selected on the Participant’s Agreement. If the Participant’s Agreement does not provide for a form of payment, then the Participant’s Deferred Compensation Benefit shall be paid in a single lump-sum. If the Participant has negotiated two or more Agreements that do not provide for the same form of payment, then a proportionate amount of the Participant’s Deferred Compensation Benefit attributable to each individual Agreement shall be paid in the form provided under both this Section 5.2 and each respective Agreement in accordance with the procedures established by the Administrator.

Section 5.3 In-Kind Payments. A Participant’s Deferred Compensation Benefit that is payable to such Participant, Participant’s beneficiary, or Participant’s guardian (as the case may be) in accordance with Sections 5.1 or 6.1, as applicable, may be paid to such Participant, Participant’s beneficiary, or Participant’s guardian in the form of cash or in-kind, as such amounts were held in the Participant’s Account immediately prior to the commencement of benefit payments under Sections 5.1 or 6.1; provided, however, that a Participant may elect instead to receive any portion of his or her Account that was held in-kind as cash, at the time and in the form and manner prescribed by the Board.

ARTICLE VI
PAYMENT OF BENEFIT ON OR AFTER DEATH OR DISABILITY

Section 6.1 Commencement of Benefit Payments. If a Participant dies or becomes Disabled prior to receiving his or her entire Deferred Compensation Benefit, then the remainder of such Deferred Compensation Benefits payable to the Participant shall be paid to the Participant, the Participant’s beneficiary, or the Participant’s guardian (as the case may be) in a single lump-sum amount thirty (30) days following the date on which the Administrator is notified of the Participant’s death or Disability.

Section 6.2 Designation of Beneficiary. A Participant may designate one or more beneficiaries, in the manner and form determined by the Administrator, to receive the Deferred Compensation Benefit following the Participant’s death. A Participant may change such beneficiary designations from time to time, as permitted by the Administrator. In the event that the Participant has beneficiary designations, the last written designation filed with the Administrator prior to the Participant’s death shall control. If a Participant fails to specifically designate a beneficiary, or if no designated beneficiary survives the Participant, payment shall be made by the Administrator in accordance with the laws of descent and distribution in effect in the Participant’s State of residence.

Section 6.3 Disability Determinations. The Administrator will be responsible for determining whether a Participant suffers from a Disability, as defined herein. The Administrator may delegate this responsibility to an independent third party selected by the Board.

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ARTICLE VII
ADMINISTRATION

Section 7.1 General. The Administrator shall be the Board, or such other person or persons as designated by the Board. Except as otherwise specifically provided in the Plan, the Administrator shall be responsible for administration of the Plan.

Section 7.2 Administrative Rules. The Administrator may adopt such rules of procedure as it deems desirable for the conduct of its affairs, except to the extent that such rules conflict with the provisions of the Plan.

Section 7.3 Duties. The Administrator shall have the following rights, powers and duties:

(a) Subject to the terms of this Plan and the Agreement, the decision of the Administrator in matters within its jurisdiction shall be final, binding and conclusive upon the Company and upon any other person affected by such decision.

(b) The Administrator shall have the duty and authority to interpret and construe the provisions of the Plan, to decide any question which may arise regarding the rights of Directors, Participants, and beneficiaries, including the amounts of their respective interests, to adopt such rules and to exercise such powers as the Administrator may deem necessary for the administration of the Plan, and to exercise any other rights, powers or privileges granted to the Administrator by the Board under the terms of the Plan.

(c) The Administrator shall maintain full and complete records of its decisions. The Administrator shall have the duty to maintain Account records of all Participants, including all relevant data pertaining to Participants. The Administrator shall within a reasonable time after the end of each Plan Year provide each Participant a detailed report of the status of the Participant’s Account.

(d) The Administrator shall cause the principal provisions of the Plan to be communicated to the Participants, and a copy of the Plan and other documents shall be available at the principal office of the Company for inspection by the Participants at reasonable times determined by the Administrator.

(e) The Administrator shall periodically report to the Board with respect to the status of the Plan.

Section 7.4 Fees. No fee or compensation shall be paid to any person for services as the Administrator.

ARTICLE VIII
MISCELLANEOUS PROVISIONS

Section 8.1 Amendment. The Company reserves the right to amend the Plan retroactively or otherwise, in any manner that it deems advisable, by a written action taken by the Board. No amendment shall, without the prior written consent of the Participant or the beneficiary, as the case may be, affect the amount or form of the Participant’s or beneficiary’s Deferred

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Compensation Benefit at the time the amendment becomes effective or the right of the Participant or the beneficiary to receive such Deferred Compensation Benefits.

Section 8.2 Termination. The Company reserves the right to terminate the Plan at any time by a written action taken by the Board. No termination shall, without the prior written consent of the Participant or the beneficiary, as the case may be, affect the amount or form of the Participant’s or the beneficiary’s Deferred Compensation Benefit prior to the termination or the right of the Participant or beneficiary to receive such Deferred Compensation Benefit.

Section 8.3 No Assignment.

(a) The Participant shall not have the power to pledge, transfer, assign, anticipate, mortgage or otherwise encumber or dispose of in advance any interest in amounts payable hereunder or any of the payments provided for herein, nor shall any interest in amounts payable hereunder or in any payments be subject to seizure for payments of any debts, judgments, alimony or separate maintenance, or be reached or transferred by operation of law in the event of bankruptcy, insolvency or otherwise.

In the event of an attempted seizure, any amounts payable hereunder may be paid to one or more of the Participant’s relatives or children, or the Participant’s spouse, as the Administrator shall determine.

(b) Notwithstanding the foregoing, a Participant’s Deferred Compensation Benefit shall be subject to division and partition in accordance with the terms of a domestic relations order satisfying the requirements of a “qualified domestic relations order” (“QDRO”), as defined in Code Section 414(p) and related regulations; provided, that (i) a separate benefit shall be recognized and maintained for any spouse or former spouse determined to have an interest in the Plan as a result of a QDRO; and (ii) all costs and expenses incurred by the Company or the Administrator in connection with such QDRO shall be charged against such Participant’s Deferred Compensation Benefit.

Section 8.4 Successors. The provisions of the Plan are binding upon and inure to the benefit of the Company, its successors and assigns, and the Participant, his or her beneficiaries, heirs, and legal representatives.

Section 8.5 Governing Law. The Plan shall be subject to and construed in accordance with the laws of the State of Ohio, to the extent not preempted by applicable law.

Section 8.6 No Guarantees. Nothing contained in the Plan shall be deemed to give any Participant the right to any equity or other interest in the assets, business or affairs of AGCo (or any entity comprising part of the Company). No Participant hereunder shall have a security interest in assets of the Company used to make contributions or pay benefits.

Section 8.7 Severability. If any provision of the Plan shall be held illegal or invalid for any reasons, such illegality or invalidity shall not affect the remaining provision of the Plan, but the Plan shall be construed and enforced as if such illegal or invalid provision had never been included herein.

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Section 8.8 Code Section 409A Compliance. The Plan is intended to be operated in compliance with the provisions of Code Section 409A (including any rulings or regulations promulgated thereunder). In the event that any provision of the Plan fails to satisfy the provisions of Code Section 409A, then such provision shall be void and shall not apply to a Participant’s Deferred Compensation Benefit, to the extent practicable. In the event that it is determined to not be feasible to so void a Plan provision as it applies to a Participant’s Deferred Compensation Benefit, such Plan provision shall be construed in a manner so as to comply with the requirements of Code Section 409A.

             IN WITNESS WHEREOF, the undersigned, on behalf of American Greetings Corporation, has executed and adopted this Plan this 14th day of December, 2005.

AMERICAN GREETINGS CORPORATION
By:	/s/ Brian T. McGrath
Name: Brian T. McGrath
Title: Vice President, Human Resources

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EX-10.5

EXHIBIT 10.5

Date        

Catherine M. Kilbane
Sr. Vice President, General Counsel
     and Secretary
American Greetings Corporation
One American Road
Cleveland, Ohio 44144

Re:	Election to Receive Director Compensation in Cash or Common Shares under the 1995 Director
	Stock Plan (the “Stock Plan”);
	Agreement for Deferred Compensation Benefits Under The American Greetings Corporation
	Outside Directors’ Deferred Compensation Plan (the “Plan”)

Dear Cathy:

This will serve as my instructions on the form of payment of my director Compensation (as defined by the Plan), and if I elect to defer any portion of my Compensation, as my Agreement with respect to the Plan.

1. Cash or Stock (Check one of Options A., B., or C.)

A. Cash.

___I elect that all of my Compensation shall be paid in cash, paid on a quarterly basis.

          OR

B. Stock in lieu of Cash.

___In lieu of cash, I elect that all of my Compensation shall be in the form of American Greetings Class A or Class B Common Shares issued under the Stock Plan as follows, issued on a quarterly basis. Fractional shares will be paid in cash.

	___in American Greetings Class B Common Shares;
Choose
Only One	OR
	___in American Greetings Class A Common Shares.

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C. Part Cash, Part Stock.

___I elect that my Compensation be paid partly in cash and partly in American Greetings Class A OR Class B Common Shares issued under the Stock Plan as follows:

Total	___% in cash;
Should
Equal	AND
100%
	___% in American Greetings Class A Common
	Shares in lieu of cash. Fractional shares will
	be paid in cash;
	OR	Choose One Only
	___% in American Greetings Class B Common
	Shares in lieu of cash. Fractional shares will
	be paid in cash.

2. Election to Defer (Check one of Option A. or B. If you elect Option A, do not complete Parts 3 and 4, simply sign and return)

A. ___I elect not to defer any portion of my Compensation. I elect to receive all Compensation currently in cash or stock as indicated in Part 1 above.

B. ___I elect to defer that portion of my Compensation into the Plan, as set forth below:

(a) Cash Compensation:

___% of the cash compensation designated in paragraphs 1(A) or 1(C) above.

___% of such cash to be paid currently and not deferred.

(b) Stock Compensation:

___% of the stock compensation designated in paragraphs 1(B) or 1(C) above.

___% of such stock compensation to be issued currently and not deferred.

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3. Deferral Period. (Check only one of the options 3.(a), (b) or (c) if you elected to defer any portion of your Compensation into the Plan under Part 2 above)

     Defer receipt of Compensation until:**

(a) ___the date that is three (3) years from the last day of the calendar year in which the payment was deferred.

(b)	___the date that is five (5) years from the last day of the calendar year in which the payment was deferred.
(c)	___the date that I separate from service (as defined by the Plan and regulations under IRS Code Section 409(A).

** Note: in the event that you separate from service with American Greetings Corporation on account of your disability or death, your benefit payment may be made earlier than the distribution date chosen by you in 3(a), (b) or (c).

4. Form of Benefit Payment. (Check only one of the options 4.(a), (b) or (c) if you elected to defer any portion of your compensation into the Plan under Part 2 above)

     Pay my Deferred Compensation Benefit in:

(a)	___one (1) lump sum payment.
(b)	___five (5) equal installments, payable over a period of five (5) years.
(c)	___ten (10) equal installments, payable over a period of ten (10) years.

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I understand that, by signing this election form, my election as to the form of Compensation and as to whether to defer Compensation is irrevocable for the calendar year to which it applies, any change in my elections will be on a prospective basis only, and such change must be filed with American Greetings Corporation prior to the beginning of the next calendar year. I further understand that with respect to my deferral election, if any, I may not change the time or form of my distribution election unless such change is made at least twelve (12) months prior to my initial distribution date and I will not thereafter be eligible for a distribution until at least five (5) years from the date of my initial distribution date.

Signature

Printed Name

Date

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EX-10.6

EXHIBIT 10.6

INDEPENDENT CONTRACTOR AGREEMENT
Sole Proprietor

     This Independent Contractor Agreement made and entered into as of the 14th day of December 14, 2005 by and between Joseph S. Hardin, Jr. of 820 Picacho Lane, Santa Barbara, CA 93108 (“Contractor”) and American Greetings Corporation located at One American Road, Cleveland, OH 44144 (“AG”).

     Whereas AG desires to engage Contractor to provide certain strategy and general management consulting services to AG on the terms and conditions stated herein; and

     Whereas Contractor desires to provide such services.

     Now, therefore, the parties covenant and agree as follows:

1. Term.

     The term of this Agreement shall be for the period beginning on the date hereof, until terminated by either party by written notice. In the event of termination, the parties shall, within two (2) working days following notice of such termination, prepare a plan for turnover to AG of all documentation, information, data, results, and notes regarding Contractor’s work to date. In the event of termination by AG, Contractor shall cease working as of the date outlined in the termination notice. Contractor shall be paid for the work up until and including said termination date.

2. Representations and Warranties.

     a.) Contractor represents and warrants that he (or she as the case may be) is (i) a sole proprietor; (ii) self-employed and does not carry any employees; and (iii) is not required to maintain workers’ compensation insurance under applicable law.

     b.) Contractor represents and warrants that the services provided under this agreement will be performed in a professional and workmanlike manner in accordance with applicable professional standards. Contractor shall observe the working hours, rules, and policies of AG.

     c.) Contractor represents and warrants to AG that Contractor can and will perform all services independent of any confidential information or proprietary or intellectual property rights of, from, or belonging to third parties. Contractor shall ensure that the services, work product, and deliverables in connection therewith will not infringe upon the proprietary or intellectual property rights of any third party.

3. Independent Contractor/Non-compete.

     a.) Contractor agrees that any work performed hereunder is performed as an independent contractor. Contractor shall not be considered an employee for any purpose nor be eligible for any employee benefits including workers’compensation coverage. Contractor shall be responsible for the payment of all taxes due with respect to the amounts paid hereunder (and AG may issue Contractor an IRS 1099 form regarding the same). Contractor is responsible for maintaining his own benefits and insurance and hereby releases AG from any claims that he may have in connection with or related to his failure to do so including but not limited to any workers’ compensation-type claim.

     b.) During the term of this agreement, and for a period of one (1) year thereafter, Contractor, shall not, without the prior written consent of AG, provide services that are similar to services

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provided by Contractor to AG hereunder with respect to any business that competes with the greeting card or broader social expressions business of AG.

4. Payment.

     AG shall pay Contractor a one-time retainer of $13,000 and a daily rate of $1,600 per day. Contractor shall submit detailed invoices on a monthly basis to AG, Attn. Zev Weiss. Each invoice shall include, (a) the dates services were performed; and (b) an itemization of reimbursable expenses (such expenses to be reimbursed based on the actual, reasonable out-of-pocket expenses incurred by Contractor); and (c) Contractor’s federal tax identification number or social security number, as the case may be. Payment terms are 2% 30 or net 75 days.

5. Confidentiality/Non-Disclosure/Ownership.

     a.) Contractor acknowledges and aggress that, in the course of performing services hereunder, Contractor may have access to and be entrusted with confidential or proprietary information concerning the business of AG, and the disclosure of said information to competitors of AG would be detrimental to the interests of AG.

     b.) Contractor further acknowledges and agrees that the right to maintain the confidentiality of such information constitutes a proprietary right that AG is entitled to protect. Accordingly, Contractor is prohibited, during the continuance of this agreement nor at any time thereafter, from using or disclosing to any person, firm or corporation, or including such confidential information with (including in the aggregate or in combination with) other information or with Contractor’s property even if such use, disclosure, or inclusion (in aggregation, in combination, or otherwise) masks the source of the confidential information.

     c.) “Confidential information” as it shall apply to this agreement shall mean any trade secret, data, know-how or information concerning the business, business practices, products, development, research, techniques, equipment, marketing, sales, inventions, discoveries, ideas, management methods or financial matters, or any confidential or secret aspect of the business of AG or its subsidiaries or affiliates or belonging to a third-party supplier of AG.

     d.) Notwithstanding the foregoing, the limitations in this section shall not apply to confidential information that is (i) in the public domain through no act of Contractor in violation of this agreement, (ii) obtained by Contractor from a third party that is not bound by a confidentiality obligation to the disclosing party, (iii) already known to Contractor, or is subsequently developed by Contractor independently and without breach of this agreement, and Contractor can reasonably demonstrate that such is the case, or (iv) required to be disclosed pursuant to a court order or other requirement of any duly constituted government agency or other authority having jurisdiction over such party; provided, however, that Contractor shall first have given notice to AG and shall give AG a reasonable opportunity to interpose an objection or obtain a protective order requiring that the Confidential Information so disclosed be used only for the purposes for which the order was issued.

     e.) Contractor acknowledges and agrees that all work product and deliverables prepared for AG during the course of this agreement shall be deemed a “work for hire,” and that AG shall be the sole and exclusive owner of all such work product and deliverables.

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6. Hold Harmless

     Contractor shall defend, indemnify, and hold AG harmless from any claims, damages, and liabilities AG may suffer as a result of Contractor’s failure to comply with the material terms and conditions contained in this agreement.

7. Complete Contract.

     This agreement and any attached exhibit(s) constitute the complete agreement and understanding between the parties with respect to the subject matter hereof and supersedes all prior agreements and understandings, written or oral. Except as otherwise provided herein, no waiver, alteration, or modification of the provisions hereof shall be binding on either party unless in a writing signed by a duly authorized representative of each party.

8. Modifications.

     Any modifications of this Agreement will be effective only if it is in writing and signed by the party to be charged.

9. Waiver.

     The failure of either party to insist on strict compliance with any of the terms, covenants, or conditions of this agreement by the other party shall not be deemed a waiver of that term, covenant, or condition, nor shall any waiver or relinquishment of any right or power at anyone time or times be deemed a waiver or relinquishment of that right or power for all or any other times.

10. Governing law.

     The validity, interpretation and performance of this agreement shall be governed and construed in accordance with the laws of the State of Ohio excluding conflict of law provisions.

In witness whereof, the parties have signed this Agreement as of the first date referenced above,

American Greetings Corporation
By	/s/ Brian T. McGrath
Name: Brian T. McGrath
Title: Vice President, Human Resources
Joseph S. Hardin, Jr.
By	/s/ Joseph S. Hardin, Jr.

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Exhibit A

Description of Services

General management and strategy consulting, including without limitation supply chain, retailer relationships, product design and production.

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