Exhibit 10a
April 20, 2000
Mr. Richard Block
Chief Executive Officer
IMPAC Group, Inc.
1776 Broadway
New York, NY 10019
Dear Richard:
I am very pleased that we have made such important progress in
defining our leadership strategies for the combination of the
consumer packaging businesses of IMPAC Group, Inc. ("IMPAC") and
Westvaco, and equally excited about the opportunities before us.
I am now writing to formalize our prior proposal to you. If you
agree to accept this offer by signing below, this letter will
modify the Employment, Non-Competition and Stock Repurchase
Agreement between you and IMPAC dated as of March 12, 1998, as
amended January 13, 1999 (your "Agreement").
As we have discussed, following the acquisition, you will report
directly to the Chief Executive Officer of Westvaco (the "CEO"),
and your responsibilities will be to work with the CEO to define
the global strategy and operating structure of the Consumer
Packaging Group and to manage to achieve the leadership position
in global markets for entertainment, pharmaceuticals, personal
care, cosmetics, tobacco and specialty foods packaging.
To provide you with an incentive to remain with IMPAC and
Westvaco following the acquisition, and to compensate you for
waiving your severance rights under your Agreement as provided
below, we are offering you a special incentive bonus equal to
$318,750, plus the amount that you agree to invest in Westvaco
stock by within six months of the acquisition, up to a maximum of
an additional $212,500, for a total maximum of $531,250. This
bonus will become vested in three installments: 25% on each of
the first and second anniversaries of the acquisition, and 50% on
the third anniversary of the acquisition, in each case if you are
still employed by Westvaco or any of its subsidiaries on the
payment date. In addition, if you are terminated without
"Cause," or if there is a change of control of Westvaco, as
defined in Westvaco's Significant Change Severance Plan, the
bonus will be fully vested immediately.
The special incentive bonus will be paid as and when it vests,
unless you elect to defer payment on a pre-tax basis under a
deferral program, to be paid out on a pre-set date in the future,
or upon your termination of employment. We will provide you with
more information on this opportunity shortly.
Your salary following the acquisition will be not less than
$425,000 per year. Any future increases will be in the
discretion of the Compensation Committee of Westvaco's Board of
Directors, which determines salaries for all senior executives of
Westvaco.
For the year 2000, you will continue to be covered by IMPAC's
current annual bonus plan. Beginning January 1, 2001, you will
participate in Westvaco's annual bonus plan, with a target bonus
opportunity of $250,000. Your actual bonus will be based 75% on
the achievement of stated business goals and effective
integration of the Consumer Packaging Group, and 25% on
Westvaco's performance and success in meeting objectives.
Every year, you will be eligible for stock options under
Westvaco's Stock Incentive Plan. The next award of options by
the Compensation Committee will take place in November 2000.
Initially, IMPAC's current employee benefits and executive fringe
benefits will continue, with a subsequent transition to
Westvaco's plans (including retirement and 401(k) plans). Your
annual vacation entitlement will be not less than the amount
specified in your Agreement.
Following the acquisition, Section 5 of your Agreement shall
cease to have any effect, and you will be covered exclusively by
the executive severance policy of Westvaco on the same terms and
conditions as your peer executives. In addition, as we have
discussed, you will be offered a Westvaco change of control
agreement.
The confidentiality covenants in your Agreement will continue to
apply. You agree that following the acquisition, (1) the
noncompetition covenant will cover, in addition to the businesses
currently covered, any other businesses of Westvaco and its
subsidiaries in which you work after the acquisition, (2) the
confidentiality and nonsolicitation covenants will cover
confidential information, employees, customers, suppliers, etc.
of Westvaco and its subsidiaries as well as of IMPAC and its
subsidiaries, and (3) the "Restricted Period" (that is, the
period during which the noncompetition and nonsolicitation
covenants apply) will be for two years following any termination
of your employment.
If the above proposal meets with your approval, please indicate your
acceptance by signing the enclosed duplicate copy of this letter,
have it signed on behalf of IMPAC, and return it to
Wendell L. Willkie, II, Senior Vice President and General Counsel
of Westvaco.
Very truly yours,
John A. Luke, Jr.
Chairman, President and CEO
Agreed to and accepted:
_____________________________
Richard Block
Dated: 4/20/00 _______________________
Agreed to for IMPAC:
David Unerwood____
Name:
Title:
Date:_4/22/00_________________
