Document:

Ex-10.6

 

EXHIBIT 10.6

     EMPLOYMENT AGREEMENT dated as of April 19, 2007, between AMERICAN COLOR GRAPHICS, INC., a New
York corporation (the “Company”), and KATHLEEN A. DEKAM (the “Executive”).

     WHEREAS, the Executive is currently employed by the Company and is a party to a letter
agreement dated November 19, 2000 (the “2000 Agreement”); and

     WHEREAS, the Company desires to continue the Executive’s employment and to provide the
Executive with additional incentives to remain in the employ of the Company on the terms and
conditions set forth herein, and the Executive desires to continue such employment on the terms and
conditions set forth herein;

     NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set forth and for
other good and valuable consideration, the parties hereto agree to amend and restate the 2000
Agreement in its entirety as follows:

     1. EFFECTIVENESS OF AGREEMENT 

     This Agreement shall become effective, and shall supersede the 2000 Agreement, as of the date
set forth above (the “Effective Time”).

     2. EMPLOYMENT AND DUTIES

          2.1. General. The Company hereby employs the Executive, and the Executive agrees to
serve, as President of the Company, upon the terms and conditions contained herein. The Executive
shall have all the responsibilities and powers normally associated with such offices. The
Executive shall perform such other duties and services for the Company, commensurate with the
Executive’s position, as may be designated from time to time by the Board. The Executive agrees to
serve the Company faithfully and to the best of her ability under the direction of the Board.

          2.2. Exclusive Services. Except as may otherwise be approved in advance by the Board,
and except during vacation periods and reasonable periods of absence due to sickness, personal
injury or other disability, the Executive shall devote her full working time throughout the
Employment Term to the services required of her hereunder. The Executive shall render her services
exclusively to the Company during the Employment Term, and shall use her best efforts, judgment and
energy to improve and advance the business and interests of the Company in a manner consistent with
the duties of her position. However, nothing in this Agreement shall preclude Executive from (a)
serving on the boards of a reasonable number of business entities, trade associations and
charitable organizations, (b) engaging in charitable activities and community affairs, (c)
accepting and fulfilling a reasonable number of speaking engagements, and (d) managing her personal
investments and affairs; provided that such activities do not either individually or in the
aggregate: interfere with the proper performance of her duties and responsibilities hereunder;
create a conflict of interest; or violate any provision of this

 

 

Agreement; and provided further that service on the board of any business
entity must be approved in advance by the Board.

          2.3. Term of Employment. The Executive’s employment under this Agreement shall
commence as of the Effective Time and shall terminate on the earlier of (a) the second anniversary
of the Effective Time, or (b) termination of the Executive’s employment pursuant to this Agreement;
provided, however, that on each anniversary of the date hereof the term of the
Executive’s employment shall be automatically extended without further action of either party for
an additional one-year period, unless written notice of either party’s intention not to extend has
been given to the other party hereto at least one year prior to the expiration of the then
effective term. The period commencing and ending on the second anniversary of the Effective Time,
or such later date to which the term of the Executive’s employment under this Agreement shall have
been extended, is hereinafter referred to as the “Employment Term”.

          2.4. Reimbursement of Expenses. The Company shall reimburse the Executive for
reasonable travel and other business expenses incurred by her in the fulfillment of her duties
hereunder upon presentation by the Executive of an itemized account of such expenditures, in
accordance with Company practices consistently applied.

     3. SALARY; OTHER COMPENSATION

          3.1. Base Salary. From the Effective Time, the Executive shall be entitled to receive
(a) a base salary at a rate of $350,000.00 per annum, payable in arrears in equal installments not
less frequently than biweekly in accordance with the Company’s payroll practices, with such
increases as may be provided in accordance with the terms hereof, and (b) a monthly car allowance
of $1,100.00 (collectively, the “Base Salary”). Once increased, such higher amount shall
constitute the Executive’s annual Base Salary.

          3.2. Annual Review. The Executive’s Base Salary shall be reviewed by the Board, based
upon the Executive’s performance, not less often than annually, and may be increased but not
decreased. In addition to any increases effected as a result of such review, the Board at any time
may in its sole discretion increase the Executive’s Base Salary.

          3.3. Bonus. The Board shall annually adopt a bonus plan and performance criteria upon
which the bonuses of executives of the Company shall be based. During her employment under this
Agreement, the Executive shall be entitled to participate in such bonus plan, under which the
Executive shall be entitled to receive a bonus of at least 50% of her Base Salary if the budget
performance criteria are satisfied.

          3.4. Special Retention Bonus. In consideration of the Executive entering into this
Agreement, concurrent with the execution and delivery of this Agreement, the Company is paying the
Executive a special retention bonus of $225,000.00 in cash. If the Executive resigns without Good
Reason, or the Company terminates the Executive’s employment for Cause, prior to April 1, 2008, the
Executive agrees to repay such special retention bonus to the Company within five business days of
the date of her resignation or termination, together with interest from the date the Executive
received the bonus (calculated at the prime rate as published in the Wall Street Journal on the
date the Executive received the bonus) to the date of repayment. The

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Company acknowledges that the special retention bonus is in addition to, and not in lieu of, any
regular incentive bonus plan in which the Executive may participate during the 2008 fiscal year.

     4. EMPLOYEE BENEFITS

     The Executive shall, during her employment under this Agreement, be included to the extent
eligible thereunder in all employee benefit plans, programs or arrangements (including, without
limitation, any plans, programs or arrangements providing for retirement benefits, incentive
compensation, profit sharing, bonuses, disability benefits, health and life insurance, or paid
holidays) which shall be established by the Company for, or made available to, its senior
executives. The Executive shall be entitled to four weeks per year of vacation with full pay in
accordance with the vacation policy of the Company.

     5. TERMINATION OF EMPLOYMENT

          5.1. Termination Without Cause; Resignation for Good Reason.

               5.1.1. General. Subject to the provisions of Sections 5.3 and 5.4, if, prior to the
expiration of the Employment Term, the Executive’s employment is terminated by the Company without
Cause, or if the Executive resigns for Good Reason, the Company shall pay to the Executive in cash
(a) a payment equal to two times the sum of (i) the Executive’s annual Base Salary and (ii) the
greater of (A) the annual bonus earned by the Executive for the last completed fiscal year prior to
the fiscal year in which the date of termination or resignation occurs and (B) the annual bonus the
Executive would have earned for the full fiscal year in which the date of termination or
resignation occurs absent such termination or resignation (which amount shall be based upon the
Company’s (and if applicable the Executive’s) actual performance against target (expressed as a
percentage of achievement of targeted performance) applicable to the portion of the performance
period during which the Executive was employed, with such percentage level of achievement
annualized for the full fiscal year), and (b) any unpaid amounts of the Executive’s Base Salary for
periods prior to the date of termination or resignation and earned annual bonuses for completed
fiscal years prior to the date of termination or resignation. The payments described in clause
(a)(i) of the next preceding sentence (less any amounts of Base Salary theretofore received for any
period after the effective date of such termination or resignation) shall be made (1) ratably over
the remainder of the Severance Period in accordance with the Company’s normal payroll practices or
(2) (if Stephen M. Dyott shall have ceased (for any reason) to be the chief executive officer of
the Company at any time prior to, or prior to the end of the one hundred eightieth day after, the
date of such termination or resignation), in a lump sum within 10 business days after the date of
termination or resignation of the Executive (or Mr. Dyott, if later), and the payments described in
clauses (a)(ii) and (b) of the next preceding sentence shall be made in a lump sum within 10
business days after the date of termination or resignation. In addition, the Executive shall be
entitled to continue to participate during the Severance Period in all employee health and welfare
benefit plans that the Company or any parent thereof provides (and continues to provide) generally
to its employees on the same terms as are provided to active executives of the Company or any such
parent. The Executive shall have no further right to receive any other compensation or benefits
after such termination or resignation except as determined in accordance with the terms of the
employee benefit plans or programs of the Company or such parent.

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               5.1.2. Date of Termination or Resignation. The date of termination of employment
without Cause shall be the date specified in a written notice of termination to the Executive.
Subject to the proviso to Section 5.6, the date of resignation for Good Reason shall be the date
specified in the written notice of resignation from the Executive to the Company; provided,
however, that no such written notice shall be effective unless the cure period specified in
Section 5.6 has expired without the Company having corrected, to the reasonable satisfaction of the
Executive, the event or events subject to cure. If no date of resignation is specified in the
written notice from the Executive to the Company, the date of resignation shall be the first day
following such expiration of such cure period.

               5.1.3. Release. If the Executive’s employment is terminated by the Company without
Cause or if the Executive resigns for Good Reason, the Company shall release the Executive from
liability for any and all acts or omissions of the Executive except for the Executive’s gross
negligence or willful misconduct.

          5.2. Termination for Cause; Resignation Without Good Reason.

               5.2.1. General. If, prior to the expiration of the Employment Term, the Executive’s
employment is terminated by the Company for Cause, or the Executive resigns other than for Good
Reason, the Executive shall be entitled only to payment of her Base Salary as then in effect
through and including the date of termination or resignation. The Executive shall have no further
right to receive any other compensation or benefits after such termination or resignation, except
as determined in accordance with the terms of the employee benefit plans or programs of the
Company.

               5.2.2. Date of Termination or Resignation. Subject to the further proviso to Section
5.5, the date of termination for Cause shall be the date specified in a written notice of
termination to the Executive. The date of resignation without Good Reason shall be the date
specified in the written notice of resignation from the Executive to the Company, or if no date is
specified therein, ten business days after receipt by the Company of written notice of resignation
from the Executive.

          5.3. Conditions Applicable to the Severance Period. If, during the Severance Period,
the Executive materially breaches her obligations under Section 8, the Company may, upon written
notice to the Executive, terminate the Severance Period and cease to make any further payments or
provide any benefits described in Section 5.1. Anything herein to the contrary notwithstanding,
the Company’s obligation to make any payment or provide any benefits described in Section 5.1 shall
be subject to the Executive’s execution of the Company’s standard form release of claims.

          5.4. Death During Severance Period. In the event of the Executive’s death during the
Severance Period, payments of Base Salary under this Section 5 shall continue to be made during the
remainder of the Severance Period to the beneficiary designated in writing for this purpose by the
Executive or, if no such beneficiary is specifically designated, to the Executive’s estate.

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          5.5. Cause. Termination for “Cause” shall mean termination of the Executive’s
employment because of (a) any act or omission that constitutes a material breach by the Executive
of any of her obligations under this Agreement; (b) the continued willful failure or refusal of the
Executive to substantially perform the duties reasonably required of her as an employee of the
Company; (c) any willful and material violation by the Executive of any Federal or state law or
regulation applicable to the business of the Company, Parent or any of their respective
subsidiaries, or the Executive’s conviction of a felony, or any willful perpetration by the
Executive of a common law fraud that is materially injurious to the Company; or (d) any other
willful misconduct by the Executive which is materially injurious to the financial condition or
business reputation of, or is otherwise materially injurious to, the Company, the Parent or any of
their respective subsidiaries or affiliates; provided, however , that (x) the good
faith performance by the Executive of the duties required of her pursuant to this Agreement, (y)
any act or omission of the Executive based upon authority given by or pursuant to an action of the
Board or upon the advice of counsel for the Company or (z) any disagreement with respect to the
advisability, timing or implementation of the sale of any capital stock or assets of the Company or
Parent, shall be conclusively presumed not to be willful or to constitute a failure or refusal on
the part of the Executive (it being understood that clause (z) above is not intended to be
exclusive with respect to the extent to which disagreements in policy will be presumed not to be
willful or to constitute a failure or refusal on the part of the Executive); provided
further, however, that if any such Cause relates to the Executive’s obligations
under this Agreement, the Company shall not terminate the Executive’s employment hereunder unless
the Company first gives the Executive written notice of its intention to terminate and of the
grounds for such termination, and the Executive has not, within 20 business days following receipt
of the notice, cured such Cause, to the reasonable satisfaction of the Board, or in the event such
Cause is not susceptible to cure within such 20-business day period, the Executive has not taken
all reasonable steps within such 20-business day period to cure such Cause, to the reasonable
satisfaction of the Board, as promptly as practicable thereafter. For purposes of this Section
5.5, no act, or failure to act, on the Executive’s part shall be deemed “willful” unless committed,
or omitted, by the Executive in bad faith.

          5.6. Good Reason. For purposes of this Agreement, “Good Reason” shall mean
any of the following (without the Executive’s prior written consent) (a) a decrease in the
Executive’s base rate of compensation or a failure by the Company to pay material compensation due
and payable to the Executive in connection with her employment; (b) a material diminution of the
responsibilities or title of the Executive with the Company or Parent; (c) the Company’s requiring
the Executive to be based at any office or location more than 20 miles from her principal
employment location on the date of this Agreement, except for any change in employment location
agreed to with the Executive prior to the Effective Time; (d) a material breach by the Company of
any term or provision of this Agreement (including, without limitation, any such breach by
operation of law); (e) receipt by the Executive of written notice from the Company of its intention
not to extend the term of the Executive’s employment pursuant to Section 2.3; (f) the failure by
the Company to obtain from any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all the business or assets of the Company an
express written assumption and agreement to perform this Agreement in the same manner and to the
same extent that the Company would be required to perform it if no such succession had taken place;
or (g) a Change of Control of the Company shall have occurred; provided, however,
that no event or condition described (i) in clauses (a)

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through (f) of this Section 5.6 shall constitute Good Reason unless (A) the Executive gives
the Company written notice of her objection to such event or condition, (B) such event or condition
is not corrected by the Company within 20 business days of its receipt of such notice (or in the
event that such event or condition is not susceptible to correction within such 20-business day
period, the Company has not taken all reasonable steps within such 20-business day period to
correct such event or condition as promptly as practicable thereafter), and (C) the Executive
resigns her employment with the Company and its subsidiaries not more than 40 business days
following the expiration of the 20-business day period described in the foregoing clause (B), or
(ii) in clause (g) of this Section 5.6 shall constitute Good Reason unless the Executive resigns
within 40 business days after the closing of such Change of Control or within 10 business days
after the first anniversary of such Change of Control.

     6. DEATH, DISABILITY OR RETIREMENT

     Subject to Section 5.4, in the event of termination of employment by reason of death,
Permanent Disability or retirement, the Executive (or her estate, as applicable) shall be entitled
to Base Salary and benefits determined under Sections 3 and 4 through the date of termination.
Other benefits shall be determined in accordance with the benefit plans maintained by the Company,
and the Company shall have no further obligation hereunder. For purposes of this Agreement,
“Permanent Disability” means a physical or mental disability or infirmity of the Executive
that prevents the normal performance of substantially all her duties as an employee of the Company
for a period of more than six months, or six months in the aggregate during any 12-month period,
established by medical evidence reasonably satisfactory to the Company.

     7. NO MITIGATION OR OFFSET

     The Executive shall not be required to mitigate the amount of any payment or benefit provided
for herein by seeking other employment or otherwise, nor shall the amount of any payment or benefit
provided for herein be reduced by any compensation or benefits earned by the Executive after the
date of the Executive’s termination of employment or resignation.

     8. NON-SOLICITATION; CONFIDENTIALITY: NON-COMPETITION

          8.1. Non-solicitation. For so long as the Executive is employed by the Company and
continuing for two years thereafter, the Executive shall not, without the prior written consent of
the Company, directly or indirectly, as a sole proprietor, member of a partnership, stockholder or
investor, officer or director of a corporation, or as an employee, associate, consultant or agent
of any person, partnership, corporation or other business organization or entity other than the
Company: (a) solicit or endeavor to entice away from the Company, the Parent or any of their
respective subsidiaries any person or entity who is, or, during the then most recent 12-month
period, was employed by, or had served as an agent or key consultant of, the Company, the Parent or
any of their respective subsidiaries; or (b) solicit or endeavor to entice away from the Company,
the Parent or any of their respective subsidiaries any person or entity who is, or was within the
then most recent 12-month period, a customer or client (or reasonably anticipated (to the general
knowledge of the Executive or the public) to become a customer or client) of the Company, the
Parent or any of their respective subsidiaries.

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          8.2. Confidentiality. The Executive covenants and agrees with the Company that she
will not at any time, except in performance of her obligations to the Company hereunder or with the
prior written consent of the Company, directly or indirectly, disclose any secret or confidential
information that she may learn or has learned by reason of her association with the Company, the
Parent or any of their respective subsidiaries and affiliates. The term “confidential
information” includes information not previously disclosed to the public or to the trade by the
Company’s management, or otherwise in the public domain, with respect to the Company’s, the
Parent’s or any of their respective affiliates’ or subsidiaries’ products, facilities, applications
and methods, trade secrets and other intellectual property, systems, procedures, manuals,
confidential reports, product price lists, customer lists, technical information, financial
information (including the revenues, costs or profits associated with any of the Company’s
products), business plans, prospects or opportunities, but shall exclude any information which (a)
is or becomes available to the public or is generally known in the industry or industries in which
the Company operates other than as a result of disclosure by the Executive in violation of her
agreements under this Section 8.2 or (b) the Executive is required to disclose under any applicable
laws, regulations or directives of any government agency, tribunal or authority having jurisdiction
in the matter or under subpoena or other process of law.

          8.3. No Competing Employment. For so long as the Executive is employed by the
Company and continuing for two years thereafter, the Executive shall not, directly or indirectly,
as a sole proprietor, member of a partnership, stockholder or investor (other than a stockholder or
investor owning not more than a 5% interest), officer or director of a corporation, or as an
employee, associate, consultant or agent of any person, partnership, corporation or other business
organization or entity other than the Company, Parent, or any of their respective Affiliates,
render any service to or in any way be affiliated with a Competitor (or any person or entity that
is reasonably anticipated (to the general knowledge of the Executive or the public) to become a
Competitor) of the Company, the Parent or any of their respective subsidiaries; provided,
however, that if (a) the Company exercises its right not to extend the Employment Term
pursuant to Section 2.3 and the Executive’s employment is terminated for any reason following the
expiration of the Employment Term, or (b) the Executive’s employment by the Company is terminated
or the Executive resigns and, in either case, (i) the Executive is not entitled to the payments
described in Section 5.1.1(a), or, if entitled thereto, does not receive such payments in full, or
is entitled to less than the full amount described therein, and (ii) Mr. Dyott shall have ceased
(for any reason) to be the chief executive officer of the Company at any time prior to, or prior to
the end of the one hundred eightieth day after, the date of such termination or registration, the
Executive’s obligations under this Section 8.3 shall terminate as of the date of termination of
employment or resignation.

          8.4. Exclusive Property. The Executive confirms that all confidential information is
and shall remain the exclusive property of the Company. All business records, papers and documents
kept or made by the Executive relating to the business of the Company shall be and remain the
property of the Company, except for such papers customarily deemed to be the personal copies of the
Executive.

          8.5. Injunctive Relief. Without intending to limit the remedies available to the
Company, the Executive acknowledges that a breach of any of the covenants contained in this Section
8 may result in material and irreparable injury to the Company, the Parent or their

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respective affiliates or subsidiaries for which there is no adequate remedy at law, that it
will not be possible to measure damages for such injuries precisely and that, in the event of such
a breach or threat thereof, the Company shall be entitled to seek a temporary restraining order
and/or a preliminary or permanent injunction restraining the Executive from engaging in activities
prohibited by this Section 8 or such other relief as may be required specifically to enforce any of
the covenants in this Section 8. If, for any reason, it is held that the restrictions under this
Section 8 are not reasonable or that consideration therefor is inadequate, such restrictions shall
be interpreted or modified to include as much of the duration and scope identified in this Section
8 as will render such restrictions valid and enforceable.

     9. ARBITRATION

     (a) Without limiting the rights of the Company under Section 8.5, any dispute or controversy
arising under or in connection with this Agreement that cannot be mutually resolved by the parties
hereto shall be settled exclusively by arbitration in New York, New York before one arbitrator of
exemplary qualifications and stature, who shall be selected jointly by the Company and the
Executive or, if the Company and the Executive cannot agree on the selection of the arbitrator,
shall be selected by the American Arbitration Association. Judgment may be entered on the
arbitrator’s award in any court having jurisdiction. The parties hereby agree that the arbitrator
shall be empowered to enter an equitable decree mandating specific enforcement of the terms of this
Agreement.

     (b) In the event that legal or arbitral action is undertaken by either party to enforce any
provision of this Agreement, the Company shall bear all expenses of the arbitrator incurred in any
arbitration hereunder and shall reimburse the Executive for any related reasonable legal fees and
out-of-pocket expenses directly attributable to such arbitration or other legal action, provided
that such legal fees are calculated on an hourly, and not on a contingency fee, basis, and
provided, further, that the Executive shall bear all such expenses of the arbitrator and all her
legal fees and out-of-pocket expenses (and reimburse the Company for its portion of such expenses)
if the arbitrator or relevant trier-of-fact determines that the Executive’s claim or position was
frivolous and without reasonable foundation.

     10. INDEMNIFICATION

     (a) The Company shall indemnify the Executive on the terms and subject to the conditions set
forth in Annex A hereto, and such Annex A is incorporated in this Agreement as a part of this
Section 10 as if set forth herein in full.

     (b) In addition, in the event the Executive was, is or becomes a party to or witness or other
participant in, or is threatened to be made a party to or witness or other participant in, a
Proceeding by reason of, or arising out of, whether in whole or in part, any event, occurrence, act
or omission that takes place either prior to or after the execution of this Agreement, related to
the fact that the Executive is or was a director or officer of Parent, or while a director or
officer is or was serving at the request of Parent as a director or officer of another Person or
related to anything done or not done by the Executive in any such capacity, whether or not the
basis of the Proceeding is alleged action in an official capacity as a director or officer of
Parent, or in any other capacity, as described above, Parent shall indemnify the Executive from and
against

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Indemnifiable Costs, to the fullest extent permitted by applicable law, as the same exists or may
hereafter be amended or interpreted (but in the case of any such amendment or interpretation, only
to the extent that such amendment or interpretation permits Parent to provide broader
indemnification rights than were permitted prior thereto); provided that Parent’s commitment set
forth in this Section 10(b) to indemnify the Executive shall be subject to the same limitations and
procedural requirements set forth in this Agreement as the Company’s obligation to indemnify the
Executive may be.

     (c) The Company and Parent will cause to be maintained for a period of not less than six years
from the date of the Executive’s termination or resignation the current directors’ and officers’
insurance and indemnification policies of the Company, Parent and their respective subsidiaries to
the extent that it provides coverage for events, occurrences, acts or omissions occurring prior to
the date of the Executive’s termination or resignation (the “D&O Insurance”) for the
Executive; provided, however, that the Company and Parent may, in lieu of
maintaining such existing D&O Insurance as provided above, cause comparable coverage to be provided
under any policy maintained for the benefit of the directors and officers of the Company and Parent
and their respective subsidiaries, so long as (i) the issuer thereof has an A.M. Best Company
rating of A or better and (ii) the material terms thereof are no less advantageous to the Executive
than the existing D&O Insurance. If the existing D&O Insurance expires, is terminated or canceled
during such six-year period, the Company and Parent will cause to be obtained, to the extent
commercially available, replacement D&O Insurance on terms and conditions no less advantageous to
the Executive than the existing D&O Insurance. Notwithstanding the foregoing, in satisfying its
obligation under this Section 10(c), the Company and Parent shall not be obligated to pay premiums
in excess of 250% of the premium paid or to be paid by the Company and Parent and their respective
subsidiaries in the fiscal year ended March 31, 2007, but provided further that the Company and
Parent shall nevertheless be obligated to provide such coverage as may be obtained for 250% of the
premium to be paid by the Company and Parent and their respective subsidiaries for such insurance
in the fiscal year ending March 31, 2007.

11. MISCELLANEOUS

          11. 1. Notices. All notices or communications hereunder shall be in writing,
addressed as follows:

	 	 	 	 	 
	 

	 	To the Company:
	 	100 Winners Circle
	 

	 	 	 	Brentwood, TN 37027
	 

	 	 	 	Telecopier No.: (615) 377-0348
	 

	 	 	 	Attention: Secretary
	 
	 	 	 	 
	 

	 	with a copy to:
	 	Metalmark Management LLC
	 

	 	 	 	1177 Avenue of the Americas
	 

	 	 	 	40th Floor
	 

	 	 	 	New York, NY 10036
	 

	 	 	 	Telecopier No.: (212) 823-1917
	 

	 	 	 	Attention: Eric T. Fry
	 

	 	 	 	               Managing Director

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	 	To the Executive:
	 	1024 Sunset Road
	 

	 	 	 	Brentwood, TN 37027

          All such notices shall be conclusively deemed to be received and shall be effective, (a) if
sent by hand delivery, upon receipt, (b) if sent by telecopy or facsimile transmission, upon
confirmation of receipt by the sender of such transmission or (c) if sent by registered or
certified mail, on the fifth day after the day on which such notice is mailed.

          11.2. Severability. Each provision of this Agreement shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision of this Agreement is
held to be prohibited by or invalid under applicable law, such provision will be ineffective only
to the extent of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.

          11.3. Assignment. This Agreement shall be binding upon and inure to the benefit of
and be enforceable by the Company and its successors and assigns, including any direct or indirect
successor by purchase, merger, consolidation, or otherwise to all or substantially all the business
or assets of the Company. Neither this Agreement nor any rights hereunder shall be assignable or
otherwise subject to hypothecation by the Executive. This Agreement shall be binding upon the
Executive, without regard to the duration of her employment by the Company or reasons for the
cessation of such employment, and inure to the benefit of her administrators, executors, heirs and
assigns, although the obligations of the Executive are personal and may be performed only by her.

          11.4. Entire Agreement. This Agreement represents the entire agreement of the parties
and shall supersede any and all previous contracts, arrangements or understandings between the
Company and the Executive including, without limitation, the 2000 Agreement. This Agreement may be
amended at any time by mutual written agreement of the parties hereto.

          11.5. Withholding. The payment of any amount pursuant to this Agreement shall be
subject to applicable withholding and payroll taxes, and such other deductions as may be required
under the Company’s employee benefit plans, if any.

          11.6. Governing Law. This Agreement shall be construed, interpreted, and governed in
accordance with the laws of the State of New York (or Delaware in the case of Section 10 to the
extent it applies to Parent) without reference to rules relating to conflict of law.

          11.7. Section 280G. Notwithstanding any other provision herein or any other
employment, severance, change in control or similar agreement to the contrary, to the extent that
any payment or distribution of any type to or for the benefit of the Executive by the Company or
any of its affiliates, whether paid or payable or distributed or distributable pursuant to the
terms of this Agreement or otherwise (including, without limitation, any accelerated vesting of
stock options or restricted stock granted by the Company) (collectively, the “Total
Payments”) is or will be subject to the excise tax imposed under Section 4999 of the Code
(which reference includes, for purposes of this Agreement, any similar successor provision to
Section 4999), then the Total Payments shall be reduced (but not below zero) so that the maximum
amount of the Total Payments (after reduction) shall be $1.00 less than the amount that would cause
the Total

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Payments to be subject to the excise tax imposed by Section 4999 of the Code. Any such
reduction shall be made by reducing any cash severance benefits.

          11.8. Section 409A. If any provision of this Agreement would cause the Executive to
incur any penalty tax or interest under Section 409A of the Code or any regulations or Treasury
guidance promulgated thereunder, the Company shall reform such provision to maintain to the maximum
extent practicable the original intent of the applicable provision without violating the provisions
of Section 409A of the Code.

          11.9. Nondisparagement. The Executive and the Company agree, during the Employment
Term and during the two-year period following the termination of the Executive’s employment with
the Company, to refrain from disparaging, either orally or in writing, the other or their
affiliates, including, without limitation, with respect to any of the Company’s services,
technologies or practices, its directors, officers, employees, agents, representatives or
stockholders or the Executive’s management abilities, skills, efforts, integrity and any and all
personal matters.

          11.10. Cooperation with Regard to Litigation. The Executive agrees to cooperate with
the Company during the Employment Term and for a period of two years thereafter by making herself
reasonably available to testify on behalf of the Company or its affiliates in any action, suit or
proceeding, whether civil, criminal, administrative or investigative, and to assist the Company or
any of its affiliates in any such action, suit or proceeding by providing information and meeting
and consulting with the Board or its counsel or counsel to the Company or its affiliates, as
reasonably requested by the Board or such counsel. The Executive shall be reimbursed by the
Company for any expenses (including, but not limited to, legal fees) reasonably incurred by the
Executive in connection with her compliance with the foregoing covenant.

          11.11. Certain Definitions. For purposes of this Agreement:

     “Affiliate” means, as applied to any Person, any other Person directly or
indirectly controlling, controlled by, or under direct or indirect common control with, such
Person. For purposes of this definition, “control” (including, with correlative meanings,
the terms “controlling”, “controlled by” and “under common control with”), as applied to any
Person, means the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the ownership of
voting securities, by contract or otherwise (it being understood that any Person that is or
may at any time become an Affiliate of any Person that was, as of the date hereof, a
controlling Affiliate of the Company (including, without limitation, as a result of any
subadvisory agreement) shall be deemed to be an Affiliate of the Company for purposes of
this Agreement).

     “Board” means Board of Directors of the Company.

     a “Change of Control” shall be deemed to have occurred on the first date after
the Effective Time on which (a) any Person (as defined below) shall acquire, whether by
purchase, exchange, tender offer, merger, consolidation or otherwise, beneficial

12

 

ownership of securities of the Company constituting a majority of the combined voting power
of the securities of the Company, (b) any Person shall acquire all or substantially all the
assets of the Company pursuant to a sale, dissolution or liquidation, (c) any Person shall
acquire the ability to appoint or elect a majority of the members of the Board or the Board
of Directors of Parent, or (d) the Designated Investors shall otherwise cease to
beneficially own at least 30% of the combined voting power of the securities of the Company.
For purposes of this paragraph, “Person” shall have the meaning given in Sections
13(d) and 14(d) of the 1934 Act, except that such term shall not include (i) any stockholder
of Parent or the Company as of the date hereof and each of their respective affiliates (the
“Designated Investors”), (ii) a trustee or other fiduciary holding securities under
an employee benefit plan of the Company or any of its affiliates, (iii) an underwriter
temporarily holding securities pursuant to an offering of such securities, and (iv) a
corporation owned, directly or indirectly, by the Designated Investors, such that the
aggregate ownership of securities or assets of the Company or the ability to appoint or
elect directors of the Company that is attributable to such Designated Investors would not
decrease to a level that would result in a Change of Control, if such ownership or ability
was deemed to be held directly in the Company. The completion of an initial public offering
in which no Person acquires beneficial ownership of a majority of the combined voting power
of the securities of such Person shall not constitute a Change of Control, nor shall the
acquisition of beneficial ownership of securities of the Company by a Person that has a
class of securities registered under Section 12 of the 1934 Act, if such acquisition does
not result in the Designated Investors owning 30% or less of the combined voting power of
the securities of the Company.

     “Code” means the U.S. Internal Revenue Code of 1986, as amended.

     “Competitor” means any Person that prints retail advertising inserts or
provides premedia services for printing and has annual combined retail advertising insert
printing and premedia revenues for the most recently ended annual reporting period in excess
of $250 million.

     “1934 Act” means the Securities Exchange Act of 1934, as amended.

     “Parent” means ACG Holdings, Inc., a Delaware corporation.

     “Person” means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization, government or any
agency or political subdivision thereof or any other entity.

     “Severance Period” means, subject to Section 5.3, the two-year period beginning
as of the date of termination of the Executive’s employment or the date of the Executive’s
resignation.

13

 

     IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed and the
Executive has hereunto set her hand, as of the day and year first above written.

	 	 	 	 	 
	 	AMERICAN COLOR GRAPHICS, INC.

 	 
	 	By:  	/s/ Stephen
M. Dyott	 
	 	 	Name:  	Stephen M. Dyott 	 
	 	 	Title:  	Chairman and CEO 	 
	 
	 	EXECUTIVE

 	 
	 	/s/
 Kathleen A. DeKam	 
	 	Name:  	Kathleen A. DeKam 	 
	 	 	 
	 

	 	 	 	 	 
	AGREED (solely with respect to

Section 10):	 	 
	 
	 	 	 	 
	ACG HOLDINGS, INC.	 	 
	 
	 	 	 	 
	By:
	 	/s/ Stephen M. Dyott	 	 
	 

	 	 

Name: Stephen M. Dyott
	 	 
	 

	 	Title: Chairman and CEO	 	 

14

 

Annex A

Indemnification

	 	1.	 	Certain Definitions. For purposes of this Agreement:

     “Disinterested Director” means a director of the Company who is not and was not
a party to the Proceeding in respect of which indemnification is sought by the Executive.

     “Expenses“
means any expense, including, without limitation, attorneys’ fees,
retainers, court costs, transcript costs, fees and expenses of experts and other witnesses,
including accountants and other advisors, travel expenses, duplicating costs, telephone
charges, postage, delivery service fees, filing fees, the premium, security for and other
costs relating to any bond (including cost bonds, appraisal bonds or their equivalents), and
all other disbursements or expenses of the types typically paid or incurred in connection
with investigating, defending, being a witness in, or participating (including on appeal),
or preparing for any of the foregoing, in any Proceeding relating to any Indemnifiable
Event, and any expenses of establishing a right to indemnification under any of Sections 2,
4 or 5.

     “Indemnifiable Cost” means any Expense, liability or loss, judgment, fine and
amount paid in settlement and any interest, assessment or other charge imposed thereon, and
any Federal, state, local or foreign taxes imposed as a result of the actual or deemed
receipt of any payments under this Agreement.

     “Indemnifiable Event” means any event, occurrence, act or omission that takes
place either prior to or after the execution of this Agreement, related to the fact that the
Executive is or was a director or officer of the Company, or while a director or officer is
or was serving at the request of the Company as a director or officer of another Person or
related to anything done or not done by the Executive in any such capacity, whether or not
the basis of the Proceeding is alleged action in an official capacity as a director or
officer of the Company, or in any other capacity, as described above.

     “Independent Counsel” means a law firm, member of a law firm or a lawyer who is
experienced in matters of corporation law and neither currently is, nor in the past three
years has been, retained to represent (i) the Company or any of its affiliates, (ii) the
Executive or (iii) any other party to the Proceeding giving rise to a claim for
indemnification or Expense Advances hereunder, in any matter (other than with respect to
matters relating to indemnification and advancement of expenses). No law firm or lawyer
shall qualify to serve as Independent Counsel if that person would, under the applicable
standards of professional conduct then prevailing, have a conflict of interest in
representing either the Company or the Executive in an action to determine the Executive’s
rights under this Agreement.

 

 

     “Proceeding” means any threatened, pending or completed action, suit,
proceeding, inquiry or alternative dispute resolution mechanism, whether civil, criminal,
administrative, investigative or arbitral that relates to an Indemnifiable Event.

     “Reviewing Party” shall have the meaning ascribed to such term in Section 3.

     2. Agreement to Indemnify. (a) General Agreement Regarding Indemnification.
In the event the Executive was, is or becomes a party to or witness or other participant in, or is
threatened to be made a party to or witness or other participant in, a Proceeding by reason of, or
arising out of, whether in whole or in part, an Indemnifiable Event, the Company shall indemnify
the Executive from and against Indemnifiable Costs, to the fullest extent permitted by applicable
law, as the same exists or may hereafter be amended or interpreted (but in the case of any such
amendment or interpretation, only to the extent that such amendment or interpretation permits the
Company to provide broader indemnification rights than were permitted prior thereto); provided that
the Company’s commitment set forth in this Section 2(a) to indemnify the Executive shall be subject
to the limitations and procedural requirements set forth in this Agreement.

     (b) Partial Indemnification. If the Executive is entitled under any provision of this
Agreement to indemnification by the Company for some or a portion of Indemnifiable Costs, but not,
however, for the total amount thereof, the Company shall nevertheless indemnify the Executive for
the portion thereof to which the Executive is entitled.

     (c) Advancement of Expenses. If so requested by the Executive, the Company shall
advance to the Executive, to the fullest extent permitted by applicable law, any and all Expenses
incurred by the Executive (an “Expense Advance” or an “Advance”) within 10 business
days after the receipt by the Company of a request from the Executive for an Advance, whether prior
to or after final disposition of any Proceeding; provided that the Company shall not advance any
expenses to the Executive unless and until it shall have received a request and undertaking
substantially in the form attached hereto as Schedule A. Any request for an Expense Advance shall
be accompanied by an itemization, in reasonable detail, of the Expenses for which advancement is
sought. Advances shall be made without regard to the Executive’s ability to repay the Expenses.
If the Executive has commenced an arbitral proceeding or legal proceeding in a court of competent
jurisdiction to secure a determination that the Executive should be indemnified under applicable
law, as provided in Section 4, any determination made by the Reviewing Party that the Executive
would not be permitted to be indemnified under applicable law shall not be binding and the
Executive shall not be required to reimburse the Company for any Expense Advance until a final
arbitral or judicial determination is made with respect thereto (as to which all rights of appeal
therefrom have been exhausted or have lapsed). The Executive’s obligation to reimburse the Company
for Expense Advances shall be unsecured and no interest shall be charged thereon.

     (d) Exception to Obligation to Indemnify and Advance Expenses. Notwithstanding
anything in this Agreement to the contrary, the Executive shall not be entitled to indemnification
or advancement pursuant to this Agreement in connection with any Proceeding initiated by the
Executive against the Company or any director or officer of the Company unless (i) the

2

 

Company has joined in or the Board has consented to the initiation of such Proceeding; or (ii)
the Proceeding is one to enforce indemnification rights under Section 5.

     3. Reviewing Party. (a) Definition of Reviewing Party. Other than as
contemplated by Section 3(b), the Person who shall determine whether the Executive is entitled to
indemnification in the first instance (the “Reviewing Party”) shall be (i) the Board acting
by a majority vote of a quorum of Disinterested Directors or (ii) if there are no Disinterested
Directors, or if the Disinterested Directors so direct, by Independent Counsel in a written
determination to the Board, a copy of which shall be delivered to the Executive.

     (b) Reviewing Party Following Change in Control. After a Change in Control, the
Reviewing Party shall be the Independent Counsel. With respect to all matters arising from such a
Change in Control concerning the rights of the Executive to indemnity payments and Expense Advances
under this Agreement or any other agreement or under applicable law or the Company’s certificate of
incorporation or by-laws now or hereafter in effect relating to indemnification for Indemnifiable
Events, the Company shall seek legal advice only from the Independent Counsel. Such counsel, among
other things, shall render its written advice to the Company and the Executive as to whether and to
what extent the Executive should be permitted to be indemnified under applicable law. The Company
shall select a law firm or lawyer to serve as Independent Counsel, subject to the consent of the
Executive, which consent shall not be unreasonably withheld. The Company agrees to pay the
reasonable fees of the Independent Counsel and to indemnify fully such counsel against any and all
expenses (including attorneys’ fees), claims, liabilities, loss and damages arising out of or
relating to this Agreement or the engagement of Independent Counsel pursuant hereto.

     4. Indemnification Process and Appeal. (a) Indemnification Payment. (i)
The determination with respect to the Executive’s entitlement to indemnification shall, to the
extent practicable, be made by the Reviewing Party not later than 30 calendar days after receipt by
the Company of a written demand on the Company for indemnification (which written demand shall
include such documentation and information as is reasonably available to the Executive and is
reasonably necessary to determine whether and to what extent the Executive is entitled to
indemnification). The Reviewing Party making the determination with respect to the Executive’s
entitlement to indemnification shall notify the Executive of such written determination no later
than two business days thereafter.

     (ii) Unless the Reviewing Party has provided a written determination to the Company that the
Executive is not entitled to indemnification under applicable law, the Executive shall be entitled
to indemnification of Indemnifiable Costs, and shall receive payment thereof, from the Company in
accordance with this Agreement within ten business days after the Reviewing Party has made its
determination with respect to the Executive’s entitlement to indemnification.

     (b) Action to Enforce Rights. If (i) no determination of entitlement to
indemnification shall have been made within the time limitation for such a determination set forth
in Section 4(a)(i), (ii) payment of indemnification pursuant to Section 4(a)(ii) is not made within
the period permitted for such payment by such section, (iii) the Reviewing Party determines
pursuant to Section 4(a) that the Executive is not entitled to indemnification under this
Agreement, or (iv) the Executive has not received advancement of Expenses within the time

3

 

period permitted for such advancement by Section 2(c), then the Executive shall have the right
to enforce the indemnification rights granted under this Agreement by seeking an award in an
arbitration to be conducted by a single arbitrator pursuant to the rules of the American
Arbitration Association (chosen as provided in Section 9(a) of the Employment Agreement to which
this Annex A is attached) or by commencing litigation in any court of competent jurisdiction
seeking an initial determination by the arbitrator or the court or challenging any determination by
the Reviewing Party or any aspect thereof. The Company hereby consents to service of process and
to appear in any such legal proceeding. Any determination by the Reviewing Party not challenged by
the Executive within six months of the date of the Reviewing Party’s determination shall be binding
on the Company and the Executive. The remedy provided for in this Section 4 shall be in addition
to any other remedies available to the Executive in law or equity.

     (c) Defense to Indemnification; Burden of Proof and Presumptions. To the maximum
extent permitted by applicable law in making a determination with respect to entitlement to
indemnification (or payment of Expense Advances) hereunder, the Reviewing Party shall presume that
the Executive is entitled to indemnification (or payment of Expense Advances) under this Agreement,
and the Company shall have the burden of proof to overcome that presumption in connection with the
making by the Reviewing Party of any determination contrary to that presumption. It shall be a
defense to any action brought by the Executive against the Company to enforce this Annex A that it
is not permissible under applicable law for the Company to indemnify the Executive for the amount
claimed. For purposes of this Agreement, the termination of any claim, action, suit or proceeding,
by judgment, order, settlement (whether with or without court approval), conviction or upon a plea
of nolo contendere, or its equivalent, shall not create a presumption that the Executive did not
meet any particular standard of conduct or have any particular belief or that a court has
determined that indemnification is not permitted by applicable law.

     5. Indemnification for Expenses Incurred in Enforcing Rights. The Company shall
indemnify the Executive against any and all Expenses to the fullest extent permitted by law and, if
requested by the Executive pursuant to the procedures set forth in Section 2(c), shall advance such
Expenses to the Executive, that are incurred by the Executive in connection with any claim asserted
against or action brought by the Executive for (i) enforcement of this Annex A; (ii)
indemnification of Indemnifiable Costs or Expense Advances by the Company under this Agreement or
any other agreement or under applicable law or the Company’s certificate of incorporation or
by-laws now or hereafter in effect relating to indemnification for Indemnifiable Events; and (iii)
recovery under directors’ and officers’ liability insurance policies maintained by the Company.

     6. Notification and Defense of Proceeding. (a) Notice. Promptly after
receipt by the Executive of notice of the commencement of any Proceeding, the Executive will, if a
claim in respect thereof is to be made against the Company under this Annex A, notify the Company
of the commencement thereof. The failure to promptly notify the Company shall not relieve the
Company from any liability that it may have to the Executive otherwise than under this Annex A, and
shall not relieve the Company from liability hereunder except to the extent the Company has been
prejudiced or as further provided in Section 6(c).

4

 

     (b) Defense. With respect to any Proceeding as to which the Executive notifies the
Company of the commencement thereof, the Company will be entitled to participate in the Proceeding
at its own expense and except as otherwise provided below, to the extent the Company so wishes, it
may assume the defense thereof with counsel selected by the Company. After notice from the Company
to the Executive of its election to assume the defense of any Proceeding, the Company will not be
liable to the Executive under this Annex A or otherwise for any Expenses subsequently incurred by
the Executive in connection with the defense of such Proceeding other than reasonable costs of
investigation or as otherwise provided below. The Executive shall have the right to employ
separate counsel in such Proceeding, but all Expenses related thereto incurred after notice from
the Company of its assumption of the defense shall be at the Executive’s expense unless: (i) the
employment of counsel by the Executive has been authorized by the Company, (ii) the Executive has
reasonably determined that there may be a conflict of interest between the Executive and the
Company in the defense of the Proceeding, (iii) after a Change in Control, the employment of
counsel by the Executive has been approved by the Independent Counsel, or (iv) the Company shall
not within 60 calendar days in fact have employed counsel to assume the defense of such Proceeding,
in each of which case all Expenses of the Proceeding shall be borne by the Company. If the Company
has selected counsel to represent the Executive and other current and former directors, officers or
employees of the Company in the defense of a Proceeding, and a majority of such persons, including
the Executive, reasonably object to such counsel selected by the Company pursuant to the first
sentence of this Section 6(b) , then such persons, including the Executive, shall be permitted to
employ one additional counsel of their choice and the fees and expenses of such counsel shall be at
the expense of the Company. In the event separate counsel is retained by a group of persons
including the Executive pursuant to this Section 6(b), the Company shall cooperate with such
counsel with respect to the defense of the Proceeding, including making documents, witnesses and
other reasonable information related to the defense available to such separate counsel pursuant to
joint-defense agreements or confidentiality agreements, as appropriate. The Company shall not be
entitled to assume the defense of any Proceeding brought by or on behalf of the Company or as to
which the Executive shall have made the determination provided for in (ii) above.

     (c) Settlement of Claims. The Company shall not be liable to indemnify the Executive
under this Agreement or otherwise for any amounts paid in settlement of any Proceeding effected
without the Company’s written consent. The Company shall not settle any Proceeding in any manner
that would impose any penalty or limitation on the Executive without the Executive’s written
consent. Neither the Company nor the Executive will unreasonably withhold their consent to any
proposed settlement. The Company shall not be liable to indemnify the Executive under this Annex A
with regard to any judicial award if the Company was not given a reasonable and timely opportunity,
at its expense, to participate in the defense of such action; the Company’s liability under this
Annex A shall not be excused if participation in the Proceeding by the Company was barred by this
Agreement.

     7. Non-Exclusivity. The rights of the Executive hereunder shall be in addition to any
other rights the Executive may have under applicable law, the Company’s certificate of
incorporation or by-laws, applicable law, vote of stockholders or Board resolution or otherwise.
To the extent that a change in applicable law (whether by statute or judicial decision) permits
greater indemnification by agreement than would be afforded currently under the Company’s

5

 

certificate of incorporation or by-laws, applicable law or this Agreement, it is the intent of
the parties that the Executive enjoy by this Agreement the greater benefits so afforded by such
change.

     8. Subrogation. In the event of payment under this Annex A, the Company shall be
subrogated to the extent of such payment to all the rights of recovery of the Executive, who shall
execute all documents required and shall do everything that may be necessary to secure such rights,
including the execution of such documents necessary to enable the Company effectively to bring suit
to enforce such rights.

     9. No Duplication of Payments. The Company shall not be liable under this Agreement
to make any payment in connection with any claim made against the Executive to the extent the
Executive has otherwise actually received payment (whether under the Company’s certificate of
incorporation or by-laws, any insurance policy, by law or otherwise) of the amounts otherwise
indemnifiable hereunder.

     10. Continuation of Indemnity. All agreements and obligations of the Company in this
Annex A shall continue during the period the Executive is a director, officer, employee, fiduciary
or agent of the Company or is serving at the request of the Company as a director, officer,
employee, fiduciary or agent of any other Person and shall continue thereafter with respect to any
possible claims based on the fact that the Executive was a director, officer, employee, fiduciary
or agent of the Company or was serving at the request of the Company as a director, officer,
employee, fiduciary or agent of any other Person.

6

 

Schedule A

REQUEST AND UNDERTAKING

ACG Holdings, Inc.

American Color Graphics, Inc.

100 Winners Circle

Brentwood, TN 37027

To: Secretary

     I request, pursuant to Section 2(c) of Annex A of the Employment Agreement dated as of April
19, 2007 (the “Agreement”), between American Color Graphics, Inc. (the “Company”)
and me, that the Company advance Expenses (as such term is defined in the Employment Agreement)
incurred in connection with [describe Proceeding] (the “Proceeding”). I have attached an
itemization, in reasonable detail, of the Expenses for which advancement is sought.

     I undertake and agree to repay to the Company any funds advanced to me or paid on my behalf if
it shall ultimately be determined that I am not entitled to indemnification. I shall make any such
repayment promptly following written notice of any such determination.

     I agree that payment by the Company of my expenses in connection with the Proceeding in
advance of the final disposition thereof shall not be deemed an admission by the Company that it
shall ultimately be determined that I am entitled to indemnification.

	 	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	[Name]	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Date:Ex-10.24

 

EXHIBIT 10.24

     RETENTION BONUS AGREEMENT dated as of April 19, 2007, between AMERICAN COLOR GRAPHICS, INC., a
New York corporation (the “Company”), and                      (the “Executive”).

     WHEREAS, the Company desires to provide the Executive with additional incentives to remain in
the employ of the Company through March 31, 2008, on the terms and conditions set forth herein, and
the Executive desires to continue such employment on the terms and conditions set forth herein;

     NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set forth and for
other good and valuable consideration, the parties hereto agree as follows:

     1. BONUS

          1.1. Special Retention Bonus. In consideration of the Executive entering into this
Agreement, not later than three business days after the execution and delivery of this Agreement,
the Company is paying the Executive a special retention bonus of
$___ in cash. If the Executive
resigns without Good Reason, or the Company terminates the Executive’s employment for Cause, prior
to April 1, 2008, the Executive agrees to repay such special retention bonus to the Company within
five business days of the date of his resignation, together with interest from the date the
Executive received the bonus (calculated at the prime rate as published in the Wall Street Journal
on the date the Executive received the bonus) to the date of repayment. The Company acknowledges
that the special retention bonus is in addition to, and not in lieu of, any regular incentive bonus
plan in which the Executive may participate during the 2008 fiscal year. This Agreement does not
constitute an agreement by the Company to continue to employ you.

          1.2. Cause. Termination for “Cause” shall mean termination of the Executive’s
employment because of:

               (a) any act or omission that constitutes a material breach by the Executive of
any of his obligations under this Agreement;

               (b) the continued willful failure or refusal of the Executive to substantially
perform the duties reasonably required of him as an employee of the Company;

               (c) any willful and material violation by the Executive of any Federal or state
law or regulation applicable to the business of the Company, Parent or any of their
respective subsidiaries, or the Executive’s conviction of a felony, or any willful
perpetration by the Executive of a common law fraud that is materially injurious to
the Company; or

               (d) any other willful misconduct by the Executive which is materially injurious
to the financial condition or business reputation of, or is otherwise

 

 

               materially injurious to, the Company, the Parent or any of their respective
subsidiaries or affiliates;

provided, however , that (x) the good faith performance by the Executive of the
duties required of him pursuant to this Agreement, or (y) any act or omission of the Executive
based upon authority given by or pursuant to an action of the Board or upon the advice of counsel
for the Company, shall be conclusively presumed not to be willful or to constitute a failure or
refusal on the part of the Executive; provided further, however, that if
any such Cause relates to the Executive’s obligations under this Agreement, the Company shall not
terminate the Executive’s employment hereunder unless the Company first gives the Executive written
notice of its intention to terminate and of the grounds for such termination, and the Executive has
not, within 20 business days following receipt of the notice, cured such Cause, to the reasonable
satisfaction of the Board, or in the event such Cause is not susceptible to cure within such
20-business day period, the Executive has not taken all reasonable steps within such 20-business
day period to cure such Cause, to the reasonable satisfaction of the Board, as promptly as
practicable thereafter.

          1.3. Good Reason. For purposes of this Agreement, “Good Reason” shall mean
any of the following (without the Executive’s prior written consent):

               (a) a decrease in the Executive’s base rate of compensation or a failure by the
Company to pay material compensation due and payable to the Executive in connection
with his employment;

               (b) a material diminution of the responsibilities or title of the Executive
with the Company;

               (c) the Company’s requiring the Executive to be based at any office or location
more than 20 miles from his principal employment location on the date of this
Agreement, except for any change in employment location agreed to with the Executive
prior to the date hereof; or

               (d) a material breach by the Company of any term or provision of this
Agreement;

provided, however, that no event or condition described in clauses (a) through (d)
of this Section 1.3 shall constitute Good Reason unless (i) the Executive gives the Company written
notice of his objection to such event or condition, (ii) such event or condition is not corrected
by the Company within 20 business days of its receipt of such notice (or in the event that such
event or condition is not susceptible to correction within such 20-business day period, the Company
has not taken all reasonable steps within such 20-business day period to correct such event or
condition as promptly as practicable thereafter) and (iii) the Executive resigns his employment
with the Company and its subsidiaries not more than 40 business days following the expiration of
the 20-business day period described in the foregoing clause (ii).

2

 

     2. NO MITIGATION OR OFFSET

     The Executive shall not be required to mitigate the amount of any payment or benefit provided
for herein by seeking other employment or otherwise, nor shall the amount of any payment or benefit
provided for herein be reduced by any compensation or benefits earned by the Executive after the
date of the Executive’s termination of employment or resignation.

     3. NON-SOLICITATION; CONFIDENTIALITY: NON-COMPETITION

          3.1. Non-solicitation. For so long as the Executive is employed by the Company (and,
if the Executive is no longer employed by the Company, through March 31, 2008), the Executive shall
not, without the prior written consent of the Company, directly or indirectly, as a sole
proprietor, member of a partnership, stockholder or investor, officer or director of a corporation,
or as an employee, associate, consultant or agent of any person, partnership, corporation or other
business organization or entity other than the Company: (a) solicit or endeavor to entice away from
the Company, the Parent or any of their respective subsidiaries any person or entity who is, or,
during the then most recent 12-month period, was employed by, or had served as an agent or key
consultant of, the Company, the Parent or any of their respective subsidiaries; or (b) solicit or
endeavor to entice away from the Company, the Parent or any of their respective subsidiaries any
person or entity who is, or was within the then most recent 12-month period, a customer or client
(or reasonably anticipated (to the general knowledge of the Executive or the public) to become a
customer or client) of the Company, the Parent or any of their respective subsidiaries.

          3.2. Confidentiality. The Executive covenants and agrees with the Company that he
will not at any time, except in performance of his obligations to the Company hereunder or with the
prior written consent of the Company, directly or indirectly, disclose any secret or confidential
information that he may learn or has learned by reason of his association with the Company, the
Parent or any of their respective subsidiaries and affiliates. The term “confidential
information” includes information not previously disclosed to the public or to the trade by the
Company’s management, or otherwise in the public domain, with respect to the Company’s, the
Parent’s or any of their respective affiliates’ or subsidiaries’ products, facilities, applications
and methods, trade secrets and other intellectual property, systems, procedures, manuals,
confidential reports, product price lists, customer lists, technical information, financial
information (including the revenues, costs or profits associated with any of the Company’s
products), business plans, prospects or opportunities, but shall exclude any information which (a)
is or becomes available to the public or is generally known in the industry or industries in which
the Company operates other than as a result of disclosure by the Executive in violation of his
agreements under this Section 3.2 or (b) the Executive is required to disclose under any applicable
laws, regulations or directives of any government agency, tribunal or authority having jurisdiction
in the matter or under subpoena or other process of law.

          3.3. No Competing Employment. For so long as the Executive is employed by the
Company (and, if the Executive is no longer employed by the Company, through March 31, 2008), the
Executive shall not, directly or indirectly, as a sole proprietor, member of a partnership,
stockholder or investor (other than a stockholder or investor owning not more than a 5% interest),
officer or director of a corporation, or as an employee, associate, consultant or

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agent of any person, partnership, corporation or other business organization or entity other
than the Company, Parent, or any of their respective Affiliates, render any service to or in any
way be affiliated with a Competitor (or any person or entity that is reasonably anticipated (to the
general knowledge of the Executive or the public) to become a Competitor) of the Company, the
Parent or any of their respective subsidiaries.

     4. ARBITRATION

     Any dispute or controversy arising under or in connection with this Agreement that cannot be
mutually resolved by the parties hereto shall be settled exclusively by arbitration in New York,
New York before one arbitrator of exemplary qualifications and stature, who shall be selected
jointly by the Company and the Executive or, if the Company and the Executive cannot agree on the
selection of the arbitrator, shall be selected by the American Arbitration Association. Judgment
may be entered on the arbitrator’s award in any court having jurisdiction. The parties hereby
agree that the arbitrator shall be empowered to enter an equitable decree mandating specific
enforcement of the terms of this Agreement.

     In the event that legal or arbitral action is undertaken by either party to enforce any
provision of this Agreement, the Company shall bear all expenses of the arbitrator incurred in any
arbitration hereunder and shall reimburse the Executive for any related reasonable legal fees and
out-of-pocket expenses directly attributable to such arbitration or other legal action, provided
that such legal fees are calculated on an hourly, and not on a contingency fee, basis, and
provided, further, that the Executive shall bear all such expenses of the arbitrator and all his
legal fees and out-of-pocket expenses (and reimburse the Company for its portion of such expenses)
if the arbitrator or relevant trier-of-fact determines that the Executive’s claim or position was
frivolous and without reasonable foundation.

     5. MISCELLANEOUS

               5.1. Entire Agreement. This Agreement represents the entire agreement of the parties
and shall supersede any and all previous contracts, arrangements or understandings between the
Company and the Executive with respect to the subject matter hereof. This Agreement may be amended
at any time by mutual written agreement of the parties hereto.

               5.2. Withholding. The payment of any amount pursuant to this Agreement shall be
subject to applicable withholding and payroll taxes.

               5.3. Governing Law. This Agreement shall be construed, interpreted, and governed in
accordance with the laws of the state of New York without reference to rules relating to conflict
of law.

               5.4. Nondisparagement. The Executive and the Company agree, during the Executive’s
employment with the Company and the two-year period following the termination of the Executive’s
employment with the Company, to refrain from disparaging, either orally or in writing, the other or
their affiliates, including, without limitation, with respect to any of the Company’s services,
technologies or practices, its directors, officers, employees, agents, representatives or
stockholders or the Executive’s management abilities, skills, efforts, integrity and any and all
personal matters.

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               5.5. Cooperation with Regard to Litigation. The Executive agrees to cooperate with
the Company during the Executive’s employment with the Company and for a period of two years
thereafter by making himself reasonably available to testify on behalf of the Company or its
affiliates in any action, suit or proceeding, whether civil, criminal, administrative or
investigative, and to assist the Company or any of its affiliates in any such action, suit or
proceeding by providing information and meeting and consulting with the Board or its counsel or
counsel to the Company or its affiliates, as reasonably requested by the Board or such counsel.
The Executive shall be reimbursed by the Company for any expenses (including, but not limited to,
legal fees) reasonably incurred by the Executive in connection with his compliance with the
foregoing covenant.

               5.6. Certain Definitions. For purposes of this Agreement:

               “Board” means Board of Directors of the Company.

               “Competitor” means any Person that prints retail advertising inserts or
provides premedia services for printing and has annual combined retail advertising insert
printing and premedia revenues for the most recently ended annual reporting period in excess
of $250 million.

               “Parent” means ACG Holdings, Inc., a Delaware corporation.

     IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed and the
Executive has hereunto set his hand, as of the day and year first above written.

	 	 	 	 	 
	 	 	AMERICAN COLOR GRAPHICS, INC.
	 
	 	 	 	 
	 

	 	By:	 	/s/ Stephen M. Dyott
	 

	 	 	 	 
	 

	 	 	 	Name: Stephen M. Dyott
	 

	 	 	 	Title: Chairman and CEO
	 
	 	 	 	 
	 	 	EXECUTIVE
	 
	 	 	 	 
	 	 	 
	 

	 	Name:	 	 

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