Exhibit 10.1


 


EMPLOYMENT
AGREEMENT


 


This EMPLOYMENT AGREEMENT is
entered into as of this 30th day of November, 2005 by and among Graphic
Packaging International, Inc., a Delaware corporation (“Employer”), Graphic
Packaging Corporation, a Delaware corporation (“GPC”) and Daniel J. Blount (“Executive”).


 


W
I T N E S S E T H :


 


WHEREAS, Employer desires to
employ Executive as its Senior Vice President and Chief Financial Officer on
the terms and conditions set forth herein;


 


WHEREAS, Executive desires
to accept such employment on the terms and conditions set forth herein;


 


WHEREAS, each of Employer, GPC
and Executive agrees that Executive will have a prominent role in the
management of the business, and the development of the goodwill, of Employer
and its Affiliates (as defined below) and will establish and develop relations
and contacts with the principal customers and suppliers of Employer and its
Affiliates in the United States and the rest of the world, all of which
constitute valuable goodwill of, and could be used by Executive to compete
unfairly with, Employer and its Affiliates;


 


WHEREAS, (i) in
the course of his employment with Employer, Executive will obtain confidential
and proprietary information and trade secrets concerning the business and
operations of Employer and its Affiliates in the United States and the rest of
the world that could be used to compete unfairly with Employer and its
Affiliates; (ii) the covenants and restrictions contained in
Sections 8 through 13, inclusive, are intended to protect the
legitimate interests of Employer and its Affiliates in their respective
goodwill, trade secrets and other confidential and proprietary information; and
(iii) Executive desires to be bound by such covenants and
restrictions;


 


NOW, THEREFORE, in consideration
of the premises and the mutual covenants and promises contained herein and for
other good and valuable consideration, Employer, GPC and Executive hereby agree
as follows:


 


1.               Agreement to Employ.  Upon
the terms and subject to the conditions of


 


this
Agreement, Employer hereby employs Executive, and Executive hereby accepts
employment by Employer.


 


2.  Term;
Position and Responsibilities.


 


(a)  Term of Employment.  Unless Executive’s employment shall sooner
terminate pursuant to Section 7, Employer shall employ Executive for
a term commencing on the date hereof and ending on the first anniversary
of the date hereof (the “Initial Term”). 
Effective upon the expiration of the Initial Term and of each Additional
Term (as defined below), Executive’s employment hereunder shall be deemed to be
automatically extended, upon the same terms and conditions, for an additional
period of one year (each, an “Additional Term”), in each such case,


 





















 


commencing upon the
expiration of the Initial Term or the then current Additional Term, as the case
may be, unless Employer, at least 180 days prior to the expiration of the
Initial Term or such Additional Term, shall give written notice (a ”Non-Extension
Notice”) to Executive of its intention not to extend the Employment Period (as
defined below) hereunder, provided that a Non-Extension Notice
shall not constitute a notice to Executive of the termination of his employment
by Employer unless such notice specifically provides for such termination of
employment and the specific date thereof. 
The period during which Executive is employed pursuant to this
Agreement, including any extension thereof in accordance with the preceding
sentence, shall be referred to as the “Employment Period”.


 


(b)  Position and Responsibilities.  During the Employment Period, Executive shall
serve as Senior Vice President and Chief Financial Officer of Employer and have
such duties and responsibilities as are customarily assigned to individuals
serving in such position and such other duties consistent with Executive’s
title and position as the Board of Directors of Employer (“Employer’s Board”)
specifies from time to time.  Executive
shall report to the Company’s President and Chief Executive Officer.  Executive shall devote all of his skill,
knowledge and working time (except for (i) vacation time as set
forth in Section 6(c) and absence for sickness or similar disability
and (ii) to the extent that it does not interfere with the
performance of Executive’s duties hereunder, (A) such reasonable
time as may be devoted to service on boards of directors of other corporations
and entities, subject to the provisions of Section 9, and the fulfillment
of civic responsibilities and (B) such reasonable time as may be
necessary from time to time for personal financial matters) to the
conscientious performance of the duties and responsibilities of such
position.  If so elected or designated by
the respective shareholders thereof, Executive shall serve as a member of
the Boards of Directors of GPC, Employer and their respective Affiliates during
the Employment Period without additional compensation.


 


3.  Base
Salary.  As compensation for the
services to be performed by Executive during the Employment Period, Employer
shall pay Executive a base salary at an annualized rate of $325,000,
payable in installments on Employer’s regular payroll dates, and, in the event
that Executive’s employment hereunder is terminated by death, for the remainder
of the pay period in which death occurs and for one month thereafter.  Employer’s Board shall review Executive’s
base salary annually during the period of his employment hereunder and, in its
sole discretion, Employer’s Board may increase (but may not decrease) such base
salary from time to time based upon the performance of Executive, the financial
condition of Employer, prevailing industry salary levels and such other factors
as Employer’s Board shall consider relevant. 
(The annual base salary payable to Executive under this Section 3,
as the same may be increased from time to time and without regard to any
reduction therefrom in accordance with the next sentence, shall hereinafter be
referred to as the “Base Salary”.)  The
Base Salary payable under this Section 3 shall be reduced to the extent
that Executive elects to defer such Base Salary under the terms of any deferred
compensation, savings plan or other voluntary deferral arrangement that may be
maintained or established by Employer.


 


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4.  Incentive
Compensation Arrangements.


 


(a)  Incentive Compensation.  During the Employment Period, Executive shall
participate in Employer’s incentive compensation programs for its senior
executives existing from time to time, at a level commensurate with his position
and duties with Employer and based on such performance targets as may be
established from time to time by Employer’s Board or a committee
thereof.  For calendar year 2006, Executive’s
aggregate annual target bonus opportunity shall be 70% of Base Salary.


 


5.  Employee
Benefits.  During the Employment
Period, employee benefits, including life, medical, dental, accidental death
and dismemberment, business travel accident, prescription drug and disability
insurance, shall be provided to Executive in accordance with the programs of
Employer then available to its senior executives, as the same may be amended
and in effect from time to time. 
Executive shall also be entitled to participate in all of Employer’s
profit sharing, pension, retirement, deferred compensation and savings plans,
as the same may be amended and in effect from time to time, applicable to
senior executives of Employer.  The
benefits referred to in this Section 5 shall be provided to Executive on
a basis that is commensurate with Executive’s position and duties with
Employer hereunder and that is no less favorable than that of similarly
situated employees of Employer.


 


6.  Perquisites
and Expenses.


 


(a)  General.  During the Employment Period, Executive shall
be entitled to the perquisites set forth on Schedule I hereto.


 


(b)  Business Travel, Lodging, etc.  Employer shall reimburse Executive for
reasonable travel, lodging, meal and other reasonable expenses incurred by him
in connection with his performance of services hereunder upon submission of
evidence, satisfactory to Employer, of the incurrence and purpose of each such
expense and otherwise in accordance with Employer’s business travel
reimbursement policy applicable to its senior executives as in effect from time
to time.


 


(c)  Vacation.  During the Employment Period, Executive shall
be entitled to a number of weeks of paid vacation on an annualized basis,
without carryover accumulation, equal to the greater of (i) four
weeks and (ii) the number of weeks of paid vacation per year
applicable to senior executives of Employer in accordance with its vacation
policy as in effect from time to time.


 


7.  Termination
of Employment.


 


(a)  Termination Due to Death or Disability.  In the event that Executive’s employment
hereunder terminates due to death or is terminated by Employer due to Executive’s
Disability (as defined below), no termination benefits shall be payable to or
in respect of Executive except as provided in Section 7(f)(ii).  For purposes of this Agreement, “Disability”
shall mean a physical or mental disability that prevents or would prevent
the performance by Executive of his duties hereunder for a continuous
period of six months or longer.  The
determination of Executive’s 


 


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Disability shall (i) be
made by an independent physician who is reasonably acceptable to Employer and
Executive (or his representative), (ii) be final and binding on the
parties hereto and (iii) be based on such competent medical
evidence as shall be presented to such independent physician by Executive
and/or Employer or by any physician or group of physicians or other competent
medical experts employed by Executive and/or Employer to advise such
independent physician.


 


(b)  Termination by Employer for Cause.  Executive may be terminated for Cause (as
defined below) by Employer, provided that Executive shall be permitted
to attend a meeting of Employer’s Board within 30 days after delivery to him
of a Notice of Termination (as defined below) pursuant to this Section 7(b) to
explain why he should not be terminated for Cause and, if following any such
explanation by Executive, Employer’s Board determines that Employer does not
have Cause to terminate Executive’s employment, any such prior Notice of
Termination delivered to Executive shall thereupon be withdrawn and of no
further force or effect.  “Cause” shall
mean (i) the willful failure of Executive substantially to perform his
duties hereunder (other than any such failure due to Executive’s physical or
mental illness) or other willful and material breach by Executive of any of his
obligations hereunder or under any option agreement or other incentive award
agreement, after a written demand for substantial performance has been
delivered, and a reasonable opportunity to cure has been given, to
Executive by Employer’s Board, which demand identifies in reasonable detail the
manner in which Employer’s Board believes that Executive has not substantially
performed his duties or has breached his obligations, (ii) Executive’s
engaging in willful and serious misconduct that has caused or is reasonably
expected to result in material injury to Employer or any of its Affiliates or (iii) Executive’s
conviction of, or entering a plea of guilty or nolo  contendere
to, a crime that constitutes a felony.


 


(c)  Termination Without Cause.  A termination “Without Cause” shall mean
a termination of employment by Employer other than due to Disability as
described in Section 7(a) or for Cause as described in Section 7(b).


 


(d)  Termination by Executive.  Executive may terminate his employment for
any reason.  A termination of
employment by Executive for “Good Reason” shall mean a termination by
Executive of his employment with Employer within 30 days following the
occurrence, without Executive’s consent, of any of the following events: (i) the
assignment to Executive of duties that are significantly different from, and
that result in a substantial diminution of, the duties that he is to
assume on the date hereof, (ii) the failure of Employer to obtain
the assumption of this Agreement by any Successor (as defined below) to
Employer as contemplated by Section 14, (iii) a reduction in
the rate of Executive’s Base Salary, (iv) a material breach by
Employer of any of its obligations hereunder or by GPC of any of its obligations
under any option agreement or other incentive award agreement or (v) delivery
to Executive of a Non-Extension Notice, provided that, in the case
of any of clauses (i), (iii) or (iv), within 30 days
following the occurrence of any of the events set forth therein, Executive
shall have delivered written notice to Employer of his intention to terminate his
employment for Good Reason, which notice specifies in reasonable detail the
circumstances claimed to give rise to Executive’s right to terminate his


 


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employment for Good Reason,
and Employer or GPC, as the case may be, shall not have cured such
circumstances to the reasonable satisfaction of Executive.


 


(e)  Notice of Termination.  Any termination by Employer pursuant to Section 7(a),
7(b) or 7(c), or by Executive pursuant to Section 7(d), shall be
communicated by a written Notice of Termination addressed to the other
parties to this Agreement.  A ”Notice
of Termination” shall mean a notice stating that Executive’s employment
with Employer has been or will be terminated.


 


(f)  Payments Upon Certain Terminations.


 


(i) 
In the event of a termination of Executive’s employment by Employer
Without Cause or a termination by Executive of his employment for Good
Reason during the Employment Period, Employer shall pay to Executive (or,
following his death, to Executive’s beneficiaries):


 


(A)  his Base Salary, which shall
be payable in installments on Employer’s regular payroll dates, for the
period  (the “Severance Period”)
beginning on the Date of Termination (as defined below) and ending on the
first anniversary of the Date of Termination and


 


(B) the product
of (1) the amount of incentive compensation that would have been payable
to Executive for the calendar year in which the Date of Termination occurs if
Executive had remained employed for the entire calendar year and assuming that
all applicable performance targets had been achieved, multiplied by (2) a fraction,
the numerator of which is equal to the number of days in such calendar year
that precede the Date of Termination and the denominator of which is equal
to 365 (such product, the “Pro Rata Bonus”), less


 


(C) the amount,
if any, paid or payable to Executive under the terms of any severance plan,
policy, program or practice of GPC, Employer or any of their respective
Affiliates applicable to Executive, as in effect on the Date of Termination; provided
that Employer may, at any time, pay to Executive, in a single lump sum and
in satisfaction of Employer’s obligations under clauses (A) and (B) of
this Section 7(f)(i), an amount equal to (x) the installments
of the Base Salary then remaining to be paid to Executive pursuant to
clause (A) above, and the amount, if any, then remaining to be paid
to Executive pursuant to clause (B) above, less (y) the
amount, if any, remaining to be paid to Executive pursuant to any plan, policy,
program or practice identified under clause (C) above.


 


If Executive’s employment
shall terminate and he is entitled to receive continued payments of his Base
Salary under clause (A) of this Section 7(f)(i), Employer shall
(x) continue to provide to Executive during the Severance Period
the life, medical, dental, and prescription drug benefits referred to in Section 5
(the “Continued Benefits”) and (y) reimburse Executive for expenses
incurred by him for outplacement and career counseling services provided to
Executive


 


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for an aggregate amount not
in excess of the lesser of (i) $25,000 and (ii) 20% of
Executive’s Base Salary.


 


Executive shall not have
a duty to mitigate the costs to Employer under this Section 7(f)(i),
except that Continued Benefits shall be reduced or canceled to the extent of
any comparable benefit coverage earned by (whether or not paid currently) or
offered to Executive during the Severance Period by a subsequent employer
or other Person (as defined below) for which Executive performs services,
including but not limited to consulting services.


 


(ii)  If
Executive’s employment shall terminate upon his death or Disability or if
Employer shall terminate Executive’s employment for Cause or Executive shall
terminate his employment without Good Reason during the Employment Period,
Employer shall pay Executive his full Base Salary through the Date of
Termination; plus, in the case of termination upon Executive’s death or
Disability, if, as of the Date of Termination, Employer has achieved the pro
rated performance objectives for such calendar year (determined as provided in Section 7(f)(i)),
the Pro Rata Bonus for the portion of the calendar year preceding Executive’s
Date of Termination (exclusive of any time between the onset of a physical
or mental disability that prevents the performance by Executive of his duties
hereunder and the resulting Date of Termination); plus, in the case of
termination upon Executive’s death, his full Base Salary for the remainder of
the pay period in which death occurs and for one month thereafter, as provided
in Section 3.


 


(iii) 
Except as specifically set forth in this Section 7(f), no benefits payable
to Executive under any otherwise applicable plan, policy, program or practice
of Employer shall be limited by this Section 7(f), provided that (x) Executive
shall not be entitled to receive any payments or benefits under any such plan,
policy, program or practice providing any bonus or incentive compensation (and
the provisions of this Section 7(f) shall supersede the provisions of
any such plan, policy, program or practice), and (y) the amount, if
any, paid or payable to Executive under the terms of any such plan, policy,
program or practice relating to severance shall reduce the amounts payable
under Section 7(f)(i) as provided in clause (C) thereof.


 


(g)  Date of Termination.  As used in this Agreement, the term “Date of
Termination” shall mean (i) if Executive’s employment is terminated
by his death, the date of his death, (ii) if Executive’s employment
is terminated by Employer for Cause, the date on which Notice of Termination is
given as contemplated by Section 7(e) or, if later, the date of
termination specified in such Notice, and (iii) if Executive’s
employment is terminated by Employer Without Cause, due to Executive’s
Disability or by Executive for any reason, the date that is 30 days after
the date on which Notice of Termination is given as contemplated by Section 7(e) or,
if no such Notice is given, 30 days after the date of termination of
employment.


 


(h)  Resignation upon Termination.  Effective as of any Date of Termination under
this Section 7 or otherwise as of the date of Executive’s termination of
employment with Employer, Executive shall resign, in writing, from all Board
memberships and other positions then held by him with GPC, Employer and their
respective Affiliates.


 


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8.  Unauthorized
Disclosure.  During the period of
Executive’s employment with Employer and the ten-year period following any
termination of such employment, without the prior written consent of Employer’s
Board or its authorized representative, except to the extent required by an
order of a court having jurisdiction or under subpoena from an appropriate
government agency, in which event, Executive shall use his best efforts to
consult with Employer’s Board prior to responding to any such order or
subpoena, and except as required in the performance of his duties hereunder,
Executive shall not disclose any confidential or proprietary trade secrets,
customer lists, drawings, designs, information regarding product development,
marketing plans, sales plans, manufacturing plans, management organization
information (including but not limited to data and other information relating
to members of the Board of Directors of GPC, Employer or any of their
respective Affiliates or to management of GPC, Employer or any of their
respective Affiliates), operating policies or manuals, business plans,
financial records, packaging design or other financial, commercial, business or
technical information (a) relating to GPC, Employer or any of their
respective Affiliates or (b) that GPC, Employer or any of their
respective Affiliates may receive belonging to suppliers, customers or others
who do business with GPC, Employer or any of their respective Affiliates
(collectively, “Confidential Information”) to any third person unless such
Confidential Information has been previously disclosed to the public or is in
the public domain (other than by reason of Executive’s breach of this Section 8).


 


9.  Non-Competition.  During the period of Executive’s employment
with Employer and, following any termination thereof, the period ending on the
later of (a) the first anniversary of the Date of Termination and (b) the
last day of the Severance Period, Executive shall not, directly or indirectly,
become employed in a similar executive capacity by, engage in business with,
serve as an agent or consultant to, or become a partner, member, principal
or stockholder (other than a holder of less than 1% of the outstanding
voting shares of any publicly held company) of, The Mead Corporation, any of
its subsidiaries or any other current or future direct competitor (or any of
such direct competitor’s subsidiaries or affiliates) in the paperboard and
paperboard packaging business of GPC, Employer or any of their respective
subsidiaries, as determined in good faith by Employer’s Board.  For purposes of this Section 9, the
phrase employment “in a similar executive capacity” shall mean employment in
any position in connection with which Executive has or reasonably would be
viewed as having powers and authorities with respect to any other Person or any
part of the business thereof that are substantially similar, with respect
thereto, to the powers and authorities assigned to the Senior Vice President,
Consumer Products Packaging or any superior executive officer of Employer in
the By-Laws of Employer as in effect on the date hereof, a copy of the
relevant portions of which has been delivered to Executive on or before the
date hereof, and which Executive hereby confirms that he has reviewed.


 


10.  Non-Solicitation
of Employees. During the period of Executive’s employment with Employer
and, following any termination thereof, the period ending on the later of (a) the
first anniversary of the Date of Termination and (b) the last day
of the Severance Period (such periods collectively, the “Restriction Period”),
Executive shall not, directly or indirectly, for his own account or for the
account of any other Person anywhere in the United States or Europe, (i) solicit
for employment, employ or otherwise interfere with the relationship of GPC,
Employer


 


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or any of their respective
subsidiaries with, any person who at any time during the six months preceding
such solicitation, employment or interference is or was employed by or
otherwise engaged to perform services for GPC, Employer or any of their
respective subsidiaries, other than any such solicitation or employment during
Executive’s employment with GPC and Employer on behalf of GPC, and Employer, or
(ii) induce any employee of GPC, Employer or any of their
respective Affiliates who is a member of management to engage in any
activity which Executive is prohibited from engaging in under any of
Sections 8, 9, 10 or 11 or to terminate his employment with Employer.


 


11.  Non-Solicitation
of Customers.  During the Restriction
Period, Executive shall not, directly or indirectly, for his own account or for
the account of any other Person anywhere in the United States or Europe,
solicit or otherwise attempt to establish any business relationship of
a nature that is competitive with the paperboard and paperboard packaging
business of GPC, Employer or any of their respective subsidiaries, as
determined in good faith by Employer’s Board, with any Person who is or was
a customer, client or distributor of GPC, Employer or any of their
respective Affiliates at any time during which Executive was employed by
Employer (in the case of any such activity during such time) or during the
twelve-month period preceding the Date of Termination (in the case of any such
activity after the Date of Termination), other than any such solicitation on
behalf of GPC, Employer or any of their respective Affiliates during Executive’s
employment with Employer.


 


12.  Return
of Documents.  In the event of the
termination of Executive’s employment for any reason, Executive shall deliver
to Employer all of (a) the property of each of GPC, Employer and
their respective Affiliates and (b) the non-personal documents and
data of any nature and in whatever medium of each of GPC, Employer and their
respective Affiliates, and he shall not take with him any such property,
documents or data or any reproduction thereof, or any documents containing or
pertaining to any Confidential Information. 
Whether documents or data are “personal” or “non-personal” shall be
determined as follows:  Executive shall
present any documents or data that he wishes to take with him to the chief
legal officer of Employer for his review. 
The chief legal officer shall make an initial determination whether any
such documents or data are personal or non-personal, and with respect to such
documents or data that he determines to be non-personal, shall notify Executive
either that such documents or data must be retained by Employer or that
Employer must make and retain a copy thereof before Executive may take
such documents or data with him.  Any
disputes as to the personal or non-personal nature of any such documents or
data shall first be presented to the Chairman of Employer’s Board or to another
representative designated by Employer’s Board, and if such disputes are not
promptly resolved by Executive and the Chairman or such representative, such
disputes shall be resolved through arbitration pursuant to Section 17(b).


 


13.  Injunctive Relief with Respect to Covenants;
Forum, Venue and Jurisdiction.  Executive acknowledges and agrees that the
covenants, obligations and agreements of Executive contained in
Sections 8, 9, 10, 11, 12 and 13 relate to special, unique and
extraordinary matters and that a violation of any of the terms of such
covenants, obligations or agreements will cause Employer irreparable injury for
which adequate remedies are not available at law.  Therefore, Executive agrees that Employer
shall be entitled to an injunction, restraining order or such other


 


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equitable relief (without
the requirement to post bond) as a court of competent jurisdiction may
deem necessary or appropriate to restrain Executive from committing any
violation of such covenants, obligations or agreements.  These injunctive remedies are cumulative and
in addition to any other rights and remedies Employer may have.  Employer, GPC and Executive hereby
irrevocably submit to the exclusive jurisdiction of the courts of the State of
new York and the Federal courts of the United States of America, in each case
located in New York City, in respect of the injunctive remedies set forth in
this Section 13 and the interpretation and enforcement of Sections 8,
9, 10, 11, 12 and 13 insofar as such interpretation and enforcement relate
to any request or application for injunctive relief in accordance with the
provisions of this Section 13, and the parties hereto hereby irrevocably
agree that (a) the sole and exclusive appropriate venue for any
suit or proceeding relating solely to such injunctive relief shall be in such
a court, (b) all claims with respect to any request or
application for such injunctive relief shall be heard and determined
exclusively in such a court, (c) any such court shall have
exclusive jurisdiction over the person of such parties and over the subject
matter of any dispute relating to any request or application for such
injunctive relief, and (d) each hereby waives any and all
objections and defenses based on forum, venue or personal or subject matter
jurisdiction as they may relate to an application for such injunctive relief in
a suit or proceeding brought before such a court in accordance with
the provisions of this Section 13. 
All disputes not relating to any request or application for injunctive
relief in accordance with this Section 13 shall be resolved by arbitration
in accordance with Section 17(b).


 


14.  Assumption
of Agreement.  Employer shall require
any Successor thereto, by agreement in form and substance reasonably
satisfactory to Executive, to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that Employer would be
required to perform it if no such succession had taken place.  Failure of Employer to obtain such agreement
prior to the effectiveness of any such succession shall be a breach of
this Agreement and shall entitle Executive to compensation from Employer in the
same amount and on the same terms as Executive would be entitled hereunder if
Employer had terminated Executive’s employment Without Cause as described in Section 7,
except that for purposes of implementing the foregoing, the date on which any
such succession becomes effective shall be deemed the Date of Termination.


 


15.  Entire Agreement.  This
Agreement (including the Exhibit hereto) constitutes the entire agreement
among the parties hereto with respect to the subject matter hereof.  All prior correspondence and proposals
(including but not limited to summaries of proposed terms) and all prior
promises, representations, understandings, arrangements and agreements relating
to such subject matter (including but not limited to those made to or with
Executive by any other Person and those contained in any prior employment, consulting
or similar agreement entered into by Executive and Employer or any predecessor
thereto or Affiliate thereof) are merged herein and superseded hereby.


 


16.  Indemnification. 
Employer hereby agrees that it shall indemnify and hold harmless
Executive to the fullest extent permitted by Delaware law from and against any
and all liabilities, costs, claims and expenses, including all costs and
expenses incurred in defense of litigation (including attorneys’ fees), arising
out of the employment of Executive hereunder, except to the


 


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extent arising out of or
based upon the gross negligence or willful misconduct of Executive.  Costs and expenses incurred by Executive in
defense of such litigation (including attorneys’ fees) shall be paid by
Employer in advance of the final disposition of such litigation upon receipt by
Employer of (a) a written request for payment, (b) appropriate
documentation evidencing the incurrence, amount and nature of the costs and
expenses for which payment is being sought, and (c) an undertaking
adequate under Delaware law made by or on behalf of Executive to repay the
amounts so paid if it shall ultimately be determined that Executive is not
entitled to be indemnified by Employer under this Agreement, including but not
limited to as a result of such exception.


 


17.  Miscellaneous.


 


(a)  Binding Effect; Assignment.  This
Agreement shall be binding on and inure to the benefit of Employer, GPC and
their respective successors and permitted assigns.  This Agreement shall also be binding on and
inure to the benefit of Executive and his heirs, executors, administrators and
legal representatives.  This Agreement
shall not be assignable by any party hereto without the prior written consent
of the other parties hereto, except as provided pursuant to this Section 17(a).  Each of GPC and Employer may effect such an
assignment without prior written approval of Executive upon the transfer of all
or substantially all of its business and/or assets (by whatever means), provided
that the Successor to Employer shall expressly assume and agree to perform this
Agreement in accordance with the provisions of Section 14.


 


(b)  Arbitration.  Any dispute or controversy arising under or
in connection with this Agreement (except in connection with any request or
application for injunctive relief in accordance with Section 13) shall be
resolved by binding arbitration.  The
arbitration shall be held in the city of Atlanta, Georgia and except to the
extent inconsistent with this Agreement, shall be conducted in accordance with
the Commercial Arbitration Rules of the American Arbitration Association
then in effect at the time of the arbitration, and otherwise in accordance with
principles which would be applied by a court of law or equity.  The arbitrator shall be acceptable to both
Employer and Executive.  If the parties
cannot agree on an acceptable arbitrator, the dispute shall be heard by a panel
of three arbitrators, one appointed by Employer, one appointed by Executive,
and the third appointed by the other two arbitrators.  All expenses of arbitration shall be borne by
the party who incurs the expense, or, in the case of joint expenses, by both
parties in equal portions, except that, in the event Executive prevails on the
principal issues of such dispute or controversy, all such expenses shall be
borne by Employer.


 


(c)  Governing Law.  This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York without reference to principles of conflicts of laws, provided
that the indemnification provisions contained in Section 16 shall be
governed by and construed in accordance with the laws of the State of Delaware.


 


(d)  Taxes.  Employer may withhold from any
payments made under this Agreement all applicable taxes, including but not
limited to income, employment and social insurance taxes, as shall be required
by law.


 


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(e)  Amendments.  No provision of this Agreement
may be modified, waived or discharged unless such modification, waiver or
discharge is approved by Employer’s Board or a Person authorized thereby
and is agreed to in writing by Executive and, in the case of any such
modification, waiver or discharge affecting the rights or obligations of GPC,
is approved by the Board of Directors of GPC or a Person authorized
thereby.  No waiver by any party hereto
at any time of any breach by any other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time. 
No waiver of any provision of this Agreement shall be implied from any
course of dealing between or among the parties hereto or from any failure by
any party hereto to assert its rights hereunder on any occasion or series of
occasions.


 


(f)  Severability.  In
the event that any one or more of the provisions of this Agreement shall be or
become invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein shall not be
affected thereby.


 


(g)  Notices.  Any notice or other
communication required or permitted to be delivered under this Agreement shall
be (i) in writing, (ii) delivered personally, by
courier service or by certified or registered mail, first-class postage prepaid
and return receipt requested, (iii) deemed to have been received on
the date of delivery or, if so mailed, on the third business day after the
mailing thereof, and (iv) addressed as follows (or to such other
address as the party entitled to notice shall hereafter designate in accordance
with the terms hereof):


 


(A)                If to Employer, to it at:


 


Graphic Packaging International, Inc.


814 Livingston Court, S.E.


Marietta, GA 30067


Attention:  General Counsel


 


(B)                  if to GPC, to it at:


 


Graphic Packaging Corporation


814 Livingston Court, S.E.


Marietta, GA 30067


Attention:  General Counsel


 


(C)                  if to Executive, to him at his residential
address as currently on file with Employer.


 


(h)  Voluntary Agreement; No Conflicts. 
Executive, Employer and GPC each represent that they are entering into
this Agreement voluntarily and that Executive’s employment hereunder and each
party’s compliance with the terms and conditions of this Agreement will not
conflict with or result in the breach by such party of any agreement to which he
or it is a party or by which he or it or his or its properties or assets
may be bound.


 


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(i)  Counterparts.  This
Agreement may be executed in counterparts, each of which shall be deemed an
original and all of which together shall constitute one and the same
instrument.


 


(j)  Headings.  The section and other
headings contained in this Agreement are for the convenience of the parties
only and are not intended to be a part hereof or to affect the meaning or
interpretation hereof.


 


(k)  Certain Definitions.


 


“Affiliate”:  with respect to any Person, means
any other Person that, directly or indirectly through one or more
intermediaries, Controls, is Controlled by, or is under common Control with the
first Person, including but not limited to a Subsidiary of the first
Person, a Person of which the first Person is a Subsidiary, or
another Subsidiary of a Person of which the first Person is also
a Subsidiary.


 


“Control”:  with respect to any Person, means the
possession, directly or indirectly, severally or jointly, of the power to
direct or cause the direction of the management policies of such Person,
whether through the ownership of voting securities, by contract or credit
arrangement, as trustee or executor, or otherwise.


 


“Person”:  any natural person, firm, partnership,
limited liability company, association, corporation, company, trust, business
trust, governmental authority or other entity.


 


“Subsidiary”: 
with respect to any Person, each corporation or other Person in which
the first Person owns or Controls, directly or indirectly, capital stock or
other ownership interests representing 50% or more of the combined voting
power of the outstanding voting stock or other ownership interests of such
corporation or other Person.


 


“Successor”: 
of a Person means a Person that succeeds to the first Person’s
assets and liabilities by merger, liquidation, dissolution or otherwise by
operation of law, or a Person to which all or substantially all the assets
and/or business of the first Person are transferred.


 


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IN WITNESS WHEREOF, Employer and GPC have duly
executed this Agreement by their authorized representatives, and Executive has
hereunto set his hand, in each case effective as of the date first above
written.


 


 


	
   

  	
  GRAPHIC PACKAGING CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Stephen M. Humphrey

  	
   

  
	
   

  	
   

  	
  Stephen M. Humphrey

  
	
   

  	
   

  	
  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GRAPHIC PACKAGING INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Stephen M. Humphrey

  	
   

  
	
   

  	
   

  	
  Stephen M. Humphrey

  
	
   

  	
   

  	
  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Executive:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Daniel J. Blount

  	
   

  
	
   

  	
  Daniel J. Blount

  
						



 


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Schedule I


Perquisites


 


1.               Annual executive physical.


 


2.               Reimbursement up to $1,000 annually for
expenses relating to income tax preparation plus additional fees if incurred on
account of job-related circumstances and the cost of representation by return
preparer during any audit.


 


3.               Reimbursement for expenses incurred for
financial and estate planning services of up to $2,500 annually.


 


4.               Subject to the advance approval of the CEO,
reimbursement for initiation fees (“grossed up” for federal and state income
taxes) and dues for one luncheon or city club.