EXHIBIT 10.1
 
 
1695 South River Road          T 847 827 9494
Des Plaines, IL 60018 USA    F 847 827 1264
schawk.com
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September 18, 2008
 
Mr. Timothy J. Cunningham
[home address]
[home address]
 

Dear Tim:
 
On behalf of Schawk, Inc. (the “Company”), I am pleased to confirm the terms of
your employment arrangement in this letter agreement (the “Agreement”).
 
1.
Term of Employment.  Your employment with the Company under this Agreement shall
be for a period commencing on September 18, 2008 (the “Effective Date”) and
ending as provided in Section 7 hereof (the “Employment Term”).

 
2.
Title and Duties.  During the Employment Term, you will serve as Executive Vice
President and Chief Financial Officer of the Company, reporting to the Board of
Directors of the Company (the “Board”), with such duties and responsibilities as
are customarily assigned to such position, and such other duties and
responsibilities not inconsistent therewith as may from time to time be assigned
to you by the Board.  During the Employment Term, you agree that you will devote
substantially all of your business time, energy, and skill to the business of
the Company and shall use your reasonable best efforts to promote the Company’s
best interest.

 
3.
Compensation.

 
 
(a)
Base Salary.  During the Employment Term, you will receive an annual base salary
of $375,000, payable in accordance with the Company’s regular payroll
practices.  Your performance and salary will be reviewed annually consistent
with other senior executives of the Company.  Your base salary, as increased
from time to time, shall be referred to herein as the “Base Salary.”

 
 
(b)
Annual Bonus.

 
 
(i)
For the period beginning on the Effective Date and ending on December 31, 2008,
you will be eligible for a bonus of $125,000, payable in January 2009 (the “2008
Bonus”).  Whether or not the 2008 Bonus is earned shall be based upon the
achievement of certain performance goals and objectives as mutually determined
by the Chief Executive Officer of the Company and you.

 
 
(ii)
The Company will not pay the portion of the Tatum Bonus you would be eligible to
receive in September 2008 with respect to the services provided by you as a
partner in the Chicago practice of Tatum, LLC.

 

 

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(iii)
Starting on January 1, 2009, during the Employment Term, you will be eligible to
participate in the Schawk AIP program, as described in the Company’s 2008 Proxy
per the terms in place from time to time.  The AIP program will provide the
opportunity for you to earn an annual bonus at the rates set forth in the AIP
program.  As of the Effective Date, the rates for you are currently 40% of Base
Salary at Threshold, 60% of Base Salary at Target, and 90% of Base Salary at
Maximum.

 
 
Except as explicitly set forth herein, all bonuses are discretionary and are not
earned until approved by the Board or the Compensation Committee of the Board.
Bonuses will be payable only if you are in the Company’s employ on the regular
or specifically described bonus payment date.  Bonuses, if any, will be paid as
soon as practicable, but no later than March 15th following the end of the
calendar year in which the bonus was earned.

 
 
(c)
Annual Incentive Compensation.  Starting on January 1, 2009, during the
Employment Term, you will be eligible to participate in any annual or long-term,
cash or equity based, incentive plan or other arrangements of the Company
provided to Executive Vice Presidents and other senior executives of the
Company, as they exist from time-to-time, including the Schawk, Inc. 2006
Long-Term Incentive Plan (together with any additional and successor Company
compensation plans, the “Schawk 2006 LTIP”).  Each award granted under the
Schawk 2006 LTIP shall be evidenced by an award agreement that shall specify the
terms and conditions of each award granted, which terms and conditions shall be
those customarily provided for such awards to senior executives of the Company,
except as otherwise provided herein.

 
 
(d)
Sign-On Award.  On the Effective Date, you will receive a “Sign-On Award” of
equity securities having a value equal to a total of $375,000 (the “$375,000
Value”) consisting of the following awards issued under the Schawk 2006 LTIP:

 
(i)
31,250 stock options priced at the date of this Agreement, and

 
(ii)
12,500 shares of restricted stock,

 
 
 
subject to your execution of the grant agreements.  Each award granted under the
Sign-On Award will be subject to a three (3) year cliff vesting schedule with
100% vesting on the third anniversary of the Effective Date and will be
evidenced by an award agreement that shall specify the terms and conditions of
each award granted, which terms and conditions shall be those customarily
provided for such awards to senior executives of the Company, except as
otherwise provided herein.

 
 
(e)
Change in Control.  During the Employment Term, upon a Change in Control of the
Company (as defined below), you shall receive accelerated vesting of (and if
applicable, have the right to exercise) 100% of any then-unvested equity and
other awards issued under Schawk 2006 LTIP held by you immediately prior to

 
 
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the Change in Control.  Any and all stock options issued under the Schawk 2006
LTIP that vest pursuant to this subsection (e) shall remain exercisable for a
minimum of 120 days following the vesting date and, to the extent that any award
incorporates a performance element that has not previously been measured, target
performance shall be deemed to have been achieved.  For purposes of this
Agreement, “Change in Control” means the same definition as set forth in the
Schawk 2006 LTIP as of the Effective Date.

 
4.
Employee Benefits.  During the Employment Term, you will be eligible to
participate in the Company’s medical plan and other employee benefit programs at
the same level as such benefits are generally provided by the Company from time
to time to other senior executives of the Company.  Your eligibility for all
such programs and plans is determined under the terms of those programs/plans as
applied generally.  The Company’s benefit programs, compensation programs, and
policies are reviewed from time to time and may be modified, amended or
terminated at any time.  Notwithstanding the foregoing, you and your wife and
other eligible dependents shall, on the Effective Date, be fully and immediately
covered under the Company’s medical and other health plans without regard to
waiting periods or exclusions for pre-existing conditions.

 
5.
Expenses and Other Benefits.

 
 
(a)
Expenses.  During the Employment Term, the Company will reimburse you for all
reasonable business expenses incurred by you in the performance of your duties
to the Company, submitted and processed in accordance with the Company’s expense
reimbursement policy.

 
 
(b)
Vacation.  During the Employment Term, you will be entitled to four (4) weeks of
paid vacation each calendar year, which shall be earned in full on the first day
of the calendar year.  For the period from the Effective Date through December
31, 2008, however, you will be entitled to two (2) weeks of paid vacation, which
will be earned in full on the Effective Date.  In the event that you do not use
all of your accrued vacation days in any period, such unused vacation days will
carry over into subsequent periods; provided, however, that no more than an
aggregate of four (4) weeks of unused vacation will be permitted to so carry
over.

 
 
(c)
Perquisites.  During the Employment Term, you shall be provided with the
opportunity to receive or participate in perquisites and other benefits on a
comparable basis as such perquisites are generally provided by the Company from
time to time to other senior executives of the Company.

 
 
(d)
Indemnification. The Company shall during the Employment Term and all applicable
statute of limitation periods: (i) indemnify you to the maximum extent allowed
under Illinois law and the Company’s governing documents, and (ii) provide
coverage for you under a directors’ and officers’ liability insurance policy in
a form at least as comprehensive as, and in an amount that is at least equal to,
that maintained by the Company at such time for any officer or director of the
Company.

 

 
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6.
Compliance with Policies.  Subject to the terms of this Agreement, you agree
that you will comply in all material respects with all policies and procedures
applicable to similarly situated employees of the Company, generally and
specifically; provided that any such failure to comply shall not be an event
constituting “Cause” for termination of employment except to the extent
specifically provided in Section 7(d) hereof.

 
7.
Termination of Employment.  Notwithstanding any other provision of the
Agreement, your employment hereunder shall terminate upon the occurrence of any
of the following events:  (i) the effective date of your voluntary resignation
with or without Good Reason (as defined below in Section 7(e)); (ii) termination
of employment by the Company due to your Disability (as defined below in Section
7(f)) or death; or (iii) termination of employment by the Company, with or
without Cause (as defined below in Section 7(d)).

 
 
(a)
Termination with Cause or Voluntary Resignation Without Good Reason.  If you are
terminated by the Company with Cause or you voluntarily resign without Good
Reason, you shall be entitled to receive as soon as reasonably practicable after
your date of termination or such earlier time as may be required by applicable
statute or regulation:

 
 
(i)
your earned but unpaid Base Salary through the date of termination;

 
 
(ii)
payment in respect of any vacation days accrued but unused through the date of
termination; and

 
 
(iii)
reimbursement for all business expenses properly incurred in accordance with
Company policy prior to the date of termination and not yet reimbursed by the
Company.  The aggregate benefits payable pursuant to clauses (i), (ii), and
(iii) hereafter referred to as the “Accrued Obligations.”

 
 
 
Except as provided herein, you shall have no further rights to any compensation
(including any Base Salary) or any other benefits under this Agreement.  All
other accrued and vested benefits, if any, due to you following your termination
of employment shall be determined and paid in accordance with the applicable
plans, policies, and practices of the Company and any award or other agreements
relating to such benefits.

 
 
(b)
Termination without Cause or Voluntary Resignation With Good Reason.  If you are
terminated by the Company other than for Cause or as a result of your Disability
or death, or if you voluntarily resign with Good Reason, you shall receive:

 
 
(i)
the Accrued Obligations; and

 
 
(ii)
subject to Section 7(g),

 
 
 
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(A)
severance pay of one (1) times Base Salary, payable in accordance with the
Company’s regular payroll practices;

 
 
(B)
a pro-rata bonus (based on the number of days elapsed in the current bonus
measurement period), if any, for the year in which termination of employment
occurred, based on the target bonus for such year, payable no later than 2 weeks
following the effective date of termination;

 
 
(C)
immediate accelerated vesting of (and if applicable, have the right to exercise)
100% of any then-unvested equity and other awards issued under Schawk 2006 LTIP;
and

 
 
(D)
contingent upon your election of COBRA continuation coverage, the continuation
of coverage under the same health benefit plans that you and your dependents
were covered under prior to termination of employment with the Company to pay
the full cost of the health insurance premiums for such COBRA coverage until the
first of the following events occurs: (I) the one (1) year anniversary following
your termination of employment or (II) the date you become eligible for coverage
under another employer group plan.

 
 
 
Except as provided herein, you shall have no further rights to any compensation
(including any Base Salary) or any other benefits under this Agreement.  All
other accrued and vested benefits, if any, due to you following your termination
of employment pursuant to this Section 7(b) shall be determined and paid in
accordance with the plans, policies and practices of the Company and any award
or other agreements relating to such benefits.  Notwithstanding the foregoing,
any and all stock options issued under the Schawk 2006 LTIP that vest pursuant
to subsection (C) above shall remain exercisable for a minimum of 120 days
following the vesting date and, to the extent that any award described in
subsection (C) above incorporates a performance element that has not previously
been measured, target performance shall be deemed to have been
achieved.  Payments and benefits provided pursuant to this Section 7(b) shall be
subject to Section 7(h) below, if applicable. The payments and benefits provided
in this Section 7(b) are in lieu of payments and benefits under any other
severance arrangement of the Company.

 
 
(c)
Termination as a Result of Disability or Death.  If you are terminated by the
Company as a result of your Disability or death, you or your estate, personal
representative or surviving spouse, as the case may be, shall receive:

 
 
(i)
the Accrued Obligations; and

 
 
(ii)
subject to Section 7(g),

 
 
 
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(A)
a pro-rata bonus (based on the number of days elapsed in the current bonus
measurement period), if any, for the year in which termination of employment
occurred, based on the target bonus for such year, payable no later than 2 weeks
following the effective date of termination;

 
 
(B)
immediate accelerated vesting of (and if applicable, have the right to exercise)
100% of any then-unvested equity and other awards issued under Schawk 2006 LTIP;
and

 
 
(C)
contingent upon your or your spouse’s election of COBRA continuation coverage,
the continuation of coverage under the same health benefit plans that you and
your dependents were covered under prior to termination of employment with the
Company to pay the full cost of the health insurance premiums for such COBRA
coverage until the first of the following events occurs: (I) the one (1) year
anniversary following your termination of employment or (II) the date you become
eligible for coverage under another employer group plan.

 
 
 
Except as provided herein, you shall have no further rights to any compensation
(including any Base Salary) or any other benefits under this Agreement.  All
other accrued and vested benefits, if any, due to you following your termination
of employment pursuant to this Section 7(c) shall be determined and paid in
accordance with the plans, policies and practices of the Company and any award
or other agreements relating to such benefits.  Notwithstanding the foregoing,
any and all stock options issued under the Schawk 2006 LTIP that vest pursuant
to subsection (B) above shall remain exercisable for a minimum of 120 days
following the vesting date and, to the extent that any award described in
subsection (B) above incorporates a performance element that has not previously
been measured, target performance shall be deemed to have been
achieved.  Payments and benefits provided pursuant to this Section 7(c) shall be
subject to Section 7(g) below, if applicable. The payments and benefits provided
in this Section 7(c) are in lieu of payments and benefits under any other
severance arrangement of the Company.

 
 
(d)
“Cause” for termination by the Company of your employment with the Company means
any of the following:

 
 
(i)
your conviction of, or plea of guilty or no contest to (A) a misdemeanor
involving material dishonesty in connection with your job duties, fraud, or
moral turpitude, or (B) a felony;

 
(ii)
your willful malfeasance, willful misconduct or gross negligence in connection
with your duties to the Company;

 
 
 
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(iii)
your willful and continued failure to substantially perform your duties to the
Company (other than any such failure resulting from incapacity due to
Disability), which failure is not remedied earlier than thirty (30) days after a
written demand for substantial performance is delivered to you by the Board
which specifically identifies the manner in which the Board believes that you
have not substantially performed your duties;

 
 
(iv)
your willful engaging in illegal conduct or gross misconduct which is materially
injurious to the business or reputation of the Company; or

 
 
(v)
your material willful breach of any of the restrictive covenants set forth in
this Agreement.

 
 
 
For purposes of this definition, no act or failure to act on your part shall be
considered “willful” unless it is done, or omitted to be done, by you in bad
faith or without reasonable belief that your action or omission was in the best
interests of the Company.  The Company shall give written notice to you of the
termination for Cause, which shall state the particular act or acts or the
failure or failures to act that constitute the grounds on which the Cause
termination is based. You shall have thirty (30) days upon receipt of the notice
in which to cure such conduct, to the extent such cure is possible.

 
 
(e)
“Good Reason” for termination by you of your employment means the occurrence
(without your express written consent) of any one of the following acts by the
Company or failures by the Company to act:

 
 
(i)
a reduction in Base Salary or a reduction in the bonus rates set forth in the
Schawk AIP, or any replacement bonus plan, below those described in Section
3(b)(iii) above except, solely with respect to bonuses, in cases where due to
poor economic performance or uncertainty the Board of Directors of the Company
suspends the bonus plan for executive management;

 
 
(ii)
the Company’s failure to require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company expressly in writing to assume and agree
to perform this Agreement in the same manner and to the same extent that the
Company would have been required to perform it if no such succession had taken
place;

 
 
(iii)
the Company’s requiring you to be based at, or perform your principal functions
at, any office or location other than a location within thirty (30) miles of the
Company’s Des Plaines, Illinois headquarters office;

 
 
(iv)
the assignment to you of any duties inconsistent in any material respect with
your position or any material diminution in your authority, duties or
responsibilities; or

 

 
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(v)
 a material breach by the Company of this Agreement.

 
 
 
Prior to your right to terminate this Agreement for Good Reason, you shall give
written notice to the Company of your intention to terminate your employment on
account of a Good Reason.  Such notice shall state the particular act or acts or
the failure or failures to act that constitute the grounds on which your Good
Reason termination is based.  The Company shall have thirty (30) days (five (5)
days in the case of a breach by the Company of this Agreement relating to the
payment of compensation) upon receipt of the notice in which to cure such
conduct, to the extent such cure is possible.

 
 
(f)
“Disability” means your inability to perform your normal duties as a result of
any physical or mental injury or ailment for (i) any consecutive ninety (90)-day
period or (ii) any one hundred eighty (180) calendar days (whether or not
consecutive) during any three hundred sixty-five (365) calendar day period.

 
 
(g)
Release.  Notwithstanding any other provision of this Agreement to the contrary,
you acknowledge and agree that any and all payments to which you are entitled
under this Section 7 which are described as being subject to this Section 7(g)
are conditioned upon and subject to your (or in the case of your death, your
personal representative’s) execution of, and not having revoked within any
applicable revocation period, a general release and waiver, in such reasonable
and customary form as shall be prepared by the Company, of all claims you or
your estate may have against the Company and its directors, officers,
subsidiaries and affiliates, except as to (i) matters covered by provisions of
this Agreement that expressly survive the termination of this Agreement and
(ii) rights to which you are entitled by virtue of your participation in the
employee benefit plans, policies and arrangements of the Company.

 
 
(h)
Code Section 409A Compliance.  Notwithstanding the above, if necessary to avoid
incurring penalties under Section 409A of the Internal Revenue Code of 1986, as
amended (the “Code”), payments and benefits due under this Section 7 shall not
be provided to you during the six (6) month period immediately following your
termination; provided, however, that on the first business day following the
date six (6) months after your termination, a lump-sum catch-up payment shall be
made to you for amounts not paid during the six (6) month delay.

 
 
(i)
No Mitigation or Offset.  You shall not be required to mitigate the amount of
any payments provided for under this Agreement by seeking other employment. No
amounts paid to or earned by you following termination of your employment shall
reduce or be set off against any amounts payable to you under this Agreement,
nor will any payments otherwise due to you hereunder be subject to offset in
respect of any claims that the Company may assert against you.

 
8.
Return of Materials.  Upon the termination of your employment, you shall return
to the Company all Company property, including all materials furnished to you
during your

 

 
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employment (including but not limited to keys, electronic communication devices,
files and identification cards) and all Company-related materials created by you
during your employment with the Company.  In addition, upon the termination of
your employment, you will provide the Company with all passwords and similar
information which will be necessary for the Company to access materials on which
you worked or to otherwise continue in its business.

 
9.
Confidentiality.  In the course of your employment with the Company, you will be
given access to and otherwise obtain knowledge of certain trade secrets and
confidential and proprietary information pertaining to the business of the
Company and its affiliates.  Other than in the course of properly performing
your duties for the Company, during the Employment Term and thereafter, you will
not, directly or indirectly, without the prior written consent of the Company,
disclose or use for the benefit of any person, corporation or other entity,
including yourself, any trade secrets or other confidential or proprietary
information concerning the Company or its affiliates, including, but not limited
to, information pertaining to clients, services, products, earnings, finances,
operations, marketing, methods or other activities; provided, however, that the
foregoing shall not apply to information which is of public record or is
generally known, disclosed or available to the general public or the industry
generally (other than as a result of your breach of this covenant or the breach
by another employee of his or her confidentiality obligations).  Notwithstanding
the foregoing, you may disclose such information as is required by law during
any legal proceeding or to your personal representatives and professional
advisers as is required for purposes of rendering tax or legal advice, and, with
respect to such personal representatives and professional advisers, you shall
inform them of your obligations hereunder and take all reasonable steps to
ensure that such professional advisers do not disclose the existence or
substance thereof.  Further, other than in the course of performing your duties
in good faith for the Company, you shall not, directly or indirectly, remove
from the Company’s premises any documents, records, computer disks or files,
computer printouts, business plans or any copies or reproductions thereof, or
any information or instruments derived therefrom, arising out of or relating to
the business of the Company and its affiliates or obtained as a result of your
employment with the Company.

 
10.
Non-Solicitation/Non-Competition.

 
 
(a)
Without the prior written consent of the Company, during the Employment Term and
for a period of twelve (12) months after the termination of your employment with
the Company for any reason, you shall not:

 
 
(i)
become engaged in or otherwise become interested in, directly or indirectly
(whether as an owner, officer, employee, consultant, director, stockholder, or
otherwise), any company, enterprise or entity that, in any market served by the
Company, provides, or has made substantial preparation to provide, services or
products that compete with any portion of the Company’s business, other than as
a holder of not more than two percent (2%) of the equity securities of any such
company, enterprise or

 

 
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entity the equity securities of which are listed on a national securities
exchange;

 
 
(ii)
for the purpose of providing services or products similar to those provided by
the Company in the conduct of the business, directly or indirectly solicit, or
assist any other person in soliciting, any customer of the Company (x) with whom
you had contact during your employment with the Company, (y) about which you
learned non-public information during your employment with the Company, or
(z) whose account you oversaw during your employment with the Company; or

 
 
(iii)
for purposes of employment with an entity other than the Company, directly or
indirectly solicit, or assist any other person in soliciting, any person who was
an employee of the Company or its affiliates as of your termination of
employment with the Company, or any person who, as of such date, was in the
process of being recruited by the Company or its affiliates to become an
employee of the Company or its affiliates (each such person, a “Protected
Employee”), or induce any Protected Employee to terminate his or her employment
with the Company or its affiliates.

 
 
(b)
You acknowledge that the protections of the Company set forth in this Section 10
are fair and reasonable.  You agree that remedies at law for a breach or
threatened breach of the provisions of this Section 10 would be inadequate and,
therefore, the Company shall be entitled, in addition to any other available
remedies, without posting a bond, to equitable relief in the form of specific
performance, temporary restraining order, temporary or permanent injunction, or
any other equitable remedy that may be then available.

 
11.
Cooperation.  You agree that during the Employment Term or following a
termination of employment for any reason, you shall, upon reasonable advance
notice, reasonably assist and cooperate with the Company with regard to any
investigation or litigation related to a matter or project in which you were
involved during your employment.  The Company shall reimburse you for all
reasonable and necessary out-of-pocket expenses related to your services under
this Section 11 within thirty (30) days of you submitting to the Company
appropriate receipts and expense statements.

 
12.
Tax Issues.

 
 
(a)
Withholding.  All payments to be made to you by the Company shall be subject to
withholding as reasonably determined by the Company pursuant to applicable law
and regulation.

 
(b)
Code Section 409A.  It is intended that any amounts payable under this Agreement
and the Company’s and your exercise of authority or discretion hereunder shall
comply with Code Section 409A (including the Treasury regulations and other
published guidance relating thereto) so as not to subject you to the payment of
any interest or additional tax imposed under Code

 

 
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Section 409A.  To the extent any amount payable to you from the Company, per
this Agreement or otherwise, would trigger the additional tax imposed by Code
Section 409A, the payment arrangements shall be modified to avoid such
additional tax.  This provision includes, but is not limited to, Treasury
Regulation Section 1.409A-3(g)(2), relating to a six-month delay in payment of
deferred compensation to a “specified employee” (as defined in the Treasury
Regulations under Section 409A) upon a separation from service, to the extent
applicable.

 
13.
Other Legal Matters.

 
 
(a)
No Other Agreements/Obligations.  You have advised the Company that your
execution and performance of the terms of this Agreement do not and will not
violate any other agreement binding on you or the rights of any third parties
and you understand that in the event this advice is not accurate the Company
will not have any obligation to you under this Agreement.   The Company
acknowledges that its employment of you will obligate it to make certain
payments to Tatum, LLC in accordance with the Company’s agreements with Tatum,
LLC.

 
 
(b)
Governing Law.  This Agreement will be governed by, and interpreted in
accordance with, the laws of the State of Illinois, without regard to the
conflict of laws provisions of any jurisdiction which would cause the
application of any law other than that of the State of Illinois.

 
 
(c)
Arbitration.  Any controversy or claim arising out of or relating to this
Agreement or for the breach thereof, or your employment, including without
limitation any statutory claims (for example, claims for discrimination
including but not limited to discrimination based on race, sex, sexual
orientation, religion, national origin, age, marital status, handicap or
disability; and claims relating to leaves of absence mandated by state or
federal law), breach of any contract or covenant (express or implied), tort
claims, violation of public policy or any other alleged violation of statutory,
contractual or common law rights (and including claims against the Company’s
officers, directors, employees or agents) if not otherwise settled between the
parties, shall be conclusively settled by arbitration to be held in Chicago,
Illinois, in accordance with the American Arbitration Association’s Employment
Arbitration Rules and Mediation Procedures (the “Rules”).  Arbitration shall be
the parties’ exclusive remedy for any such controversies, claims or
breaches.  The parties also consent to personal jurisdiction in Chicago,
Illinois with respect to such arbitration.  The award resulting from such
arbitration shall be final and binding upon both parties.  This Agreement shall
be governed by the laws of the United States of America and the State of
Illinois without regard to any conflict of law provisions of any
jurisdiction.  You and the Company hereby waive the right to pursue any claims,
including but not limited to employment related claims, through civil litigation
outside the arbitration procedures of this provision, unless otherwise required
by law.  You and the Company each have the right to be represented by counsel
with respect to arbitration of any dispute pursuant to this paragraph.  The
arbitrator shall be

 

 
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selected by agreement between the parties, but if they do not agree on the
selection of an arbitrator within thirty (30) days after the date of the request
for arbitration, the arbitrator shall be selected pursuant to the Rules.  With
respect to any claim brought to arbitration hereunder, both you and the Company
shall be entitled to recover whatever damages would otherwise be available to
you/it in any legal proceeding based upon the federal and/or state law
applicable to the claim, except that parties agree they shall not seek any award
for punitive damages for any claims they may have under this Agreement.  The
decision of the arbitrator may be entered and enforced in any court of competent
jurisdiction by either you or the Company.  Each party shall pay the fees of
their respective attorneys (except as otherwise awarded by the arbitrator), the
expenses of their witnesses and any other expenses connected with presenting
their cases, other costs, including the fees of the mediator, the arbitrator,
the cost of any record or transcript of the arbitration, and administrative
fees, shall be borne equally by the parties, one-half by you, and one-half by
the Company.  Should you pursue any dispute or matter covered by this paragraph
by any method other than said arbitration, the Company shall be entitled to
recover from you all damages, costs, expenses, and attorneys’ fees incurred as a
result of such action. Should the Company pursue any dispute or matter covered
by this paragraph by any method other than said arbitration, you shall be
entitled to recover from the Company all damages, costs, expenses, and
attorneys’ fees incurred as a result of such action.  The provisions contained
in this paragraph shall survive termination of your employment with the Company
and the termination and/or expiration of this Agreement.

 
 
(d)
Notice.  All notices and other communications under this Agreement shall be in
writing to you at such address as most currently appears in the records of the
Company and, if to the Company:

 
Schawk, Inc.
HR Service Center
1695 River Road
Des Plaines, IL 60018
Attn: Jennifer Erfurth.

 
(e)
Full and Complete Agreement.  This Agreement contains the entire understanding
of the parties and may be amended only in a writing signed by the parties.  This
Agreement supersedes any and all prior agreements, whether written or oral,
between you and the Company, that are not specifically incorporated by reference
herein.  You specifically acknowledge that no promises or commitments have been
made to you that are not set forth in this letter.

 
 
(f)
Survival of Provisions.  The provisions of Sections 9 through 11 of this
Agreement shall survive the termination of your employment with the Company and
the expiration or termination of this Agreement.

 

 
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[schawk-logosmall.jpg]

 
(g)
Severability.  If any provision of this Agreement or the application thereof is
held invalid, such invalidity shall not affect other provisions or applications
of this Agreement that can be given effect without the invalid provision or
application and, to such end, the provisions of this Agreement are declared to
be severable.

 
 
(h)
No Waiver.  The failure of a party to insist upon strict adherence to any term
of this Agreement on any occasion shall not be considered a waiver of such
party’s rights or deprive such party of the right thereafter to insist upon
strict adherence to that term or any other term of this Agreement.

 
 
(i)
Counterparts and Signatures.  This Agreement may be signed in counterparts, each
of which shall be an original, with the same effect as if the signatures were
upon the same instrument.  Signatures delivered by facsimile or PDF file shall
constitute original signatures.

 
If these terms are agreeable to you, please sign and date the enclosed copy of
this letter in the appropriate space at the bottom and return it to me to
indicate your agreement to these terms.
 
Yours sincerely,
 
 

         
/s/David A. Schawk
   
 
 
David A. Schawk
   
 
 
President and Chief Executive Officer
   
 
 

 
 
I hereby accept the terms and conditions of employment as outlined above:
 

         
/s/Timothy J. Cunningham
   
September 18, 2008
 
Timothy J. Cunningham
   
Date
 
 
   
 
 

 
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