8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 12, 2008

VALASSIS COMMUNICATIONS, INC.

(Exact name of registrant as specified in its charter)

Delaware	1-10991	38-2760940
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

19975 Victor Parkway, Livonia, MI	48152
(Address of Principal Executive Offices)	(Zip Code)

(734) 591-3000

Registrant’s Telephone Number, Including Area Code

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

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

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

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

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

Items to be Included in this Report

Item 5.02(e). Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On May 12, 2008, Valassis Communications, Inc. (“Valassis”) and Alan F. Schultz, Valassis’ Chairman of the Board of Directors, Chief Executive Officer and President, entered into an amendment to Mr. Schultz’s employment agreement (the “Schultz Amendment”) providing for, among other items, (i) an increase in his annual base salary to $1,000,000, effective July 1, 2008, (ii) an extension of the term of his employment until January 1, 2012, (iii) an increase in his semi-annual bonus opportunities to up to 100% of annual base salary if and to the extent certain performance goals are met, (iv) the grant of stock options on May 12, 2008 and January 1, 2009, each to purchase 550,000 shares of Valassis’ common stock pursuant to the Valassis’ 2008 Omnibus Incentive Compensation Plan (the “Plan”), (v) the reallocation of 11,250 shares of restricted stock from non-performance based to performance based, and (vi) certain changes to comply with Section 409A of the Internal Revenue Code. All other terms and conditions of Mr. Schultz’s employment agreement remain in full force and effect.

The foregoing description of the Schultz Amendment is summary in nature, and is qualified in its entirety by reference to the full text of the Schultz Amendment, a copy of which is attached hereto as Exhibit 10.1 and incorporated herein by reference.

On May 13, 2008, Valassis issued a press release (the “Press Release”) announcing the extension of Mr. Schultz’s employment agreement. Filed hereto as Exhibit 99.1 to this Current Report on Form 8-K is a copy of the Press Release.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description
10.1	Amendment to Employment Agreement, dated as of May 12, 2008, between Valassis Communications, Inc. and Alan F. Schultz
99.1	Valassis Communications, Inc. Press Release dated May 13, 2008

SIGNATURE

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

	VALASSIS COMMUNICATIONS, INC.
	By:	/s/ Robert L. Recchia
Date: May 13, 2008	Name:	Robert L. Recchia
	Title:	Executive Vice President and Chief Financial Officer

Exhibit Index

Exhibit No.	Description
10.1	Amendment to Employment Agreement, dated as of May 12, 2008, between Valassis Communications, Inc. and Alan F. Schultz
99.1	Valassis Communications, Inc. Press Release dated May 13, 2008

EX-10.1

Exhibit 10.1

AMENDMENT

TO

EMPLOYMENT AGREEMENT

THIS AMENDMENT TO EMPLOYMENT AGREEMENT (the “Amendment”) is made May 12, 2008 by and between Valassis Communications, Inc. (the “Corporation”) and Alan F. Schultz (the “Executive”).

WHEREAS, the Corporation and the Executive entered into that certain Employment Agreement effective as of March 18, 1992, as amended on December 22, 1994, January 3, 1995, December 19, 1995, September 15, 1998, December 16, 1999, March 14, 2001, June 26, 2001, January 9, 2004, December 21, 2004 and December 21, 2007 (as amended, the “Employment Agreement”); and

WHEREAS, the Corporation and the Executive desire to amend certain sections of the Employment Agreement as outlined below.

NOW THEREFORE, for good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto agree as set forth below.

1. Section 1(b) of the Employment Agreement shall be amended to read in its entirety as follows:

“The Employment Period shall commence as of March 18, 1992 (the “Effective Date”) and shall continue until the close of business on January 1, 2012.”

2. The first sentence of Section 3(a) of the Employment Agreement shall be amended in its entirety to read as follows:

“The Executive’s Annual Base Salary (“Annual Base Salary”), payable on a biweekly basis, shall be at the annual rate of not less than $860,000, which annual rate shall increase to $1,000,000 commencing July 1, 2008.”

3. The fifth sentence of Section 3(a) of the Employment Agreement shall be amended by deleting:

“In addition, the Executive shall receive for the 1996 fiscal year and for each fiscal year thereafter during the Employment Period,”

And replacing it with:

“In addition, the Executive shall receive for the 1996 fiscal year and for each fiscal year thereafter during the Employment Period ending on or prior to December 31, 2008,”

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4. The fifth sentence of Section 3(a) of the Employment Agreement shall be further amended, effective as of May 12, 1999, to replace “7,500 shares” with “11,250 shares”, such amendment to reflect the Corporation’s 3:2 stock split which was effective on May 12, 1999.

5. The fifth sentence of Section 3(a) of the Employment Agreement shall be further amended to add the following language after “the VCI Employee and Director Restricted Award Plan adopted December 13, 1995, subject to the approval of VCI’s shareholders”:

“(or such other plan applicable to executives of the Corporation in effect from time to time)”

6. Section 3(b) of the Employment Agreement shall be amended to insert the following at the end of such section:

“Commencing on July 1, 2008, with respect to each six month period ending on June 30 and December 31 thereafter during the Employment Period, the Executive shall be paid by the Corporation a semi-annual cash bonus in accordance with the performance targets (the “Targets”) set by the Board or the Compensation/Stock Option Committee of the Board (the “Committee”) under the terms of the Valassis Communications, Inc. 2008 Senior Executives Semi-Annual Bonus Plan (the “Senior Executive Bonus Plan”). The target semi-annual cash bonus will be 100% of the Annual Base Salary earned during the applicable performance period (the “Target Award”). The actual amount of the award shall range from zero to 200% of the Target Award based upon achievement of specified performance objectives as set by the Committee in advance of the applicable six month period. Each such semi-annual bonus shall be paid promptly after the end of the applicable six month period in accordance with and subject to the terms and conditions of the Senior Executive Bonus Plan.”

7. Section 3(c) of the Employment Agreement shall be amended in its entirety to read as follows:

“The Executive shall be eligible to receive non-qualified options to purchase an aggregate of 1,100,000 shares of Common Stock of the Corporation pursuant to the Corporation’s 2008 Omnibus Incentive Compensation Plan (or such other plan applicable to executives of the Corporation in effect from time to time) (each, an “Option” and collectively, the “Options”). Subject to the approval of the Board or the Committee, as applicable, the Options shall be granted by the Corporation in two (2) installments as follows: an Option to purchase 550,000 shares of Common Stock of the Corporation shall be granted upon the effective date of this Amendment, and an Option to purchase

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550,000 shares of Common Stock of the Corporation shall be granted on January 1, 2009 (each date on which the Option is granted as provided for herein, the “Date of Grant”). Each Option shall have a strike price equal to the Fair Market Value (as defined in the Corporation’s applicable stock option plan) of the Corporation’s Common Stock on the Date of Grant and shall become fully vested three (3) years from such Date of Grant and exercisable for four (4) years thereafter, with the same terms and conditions as the Corporation’s then current standard non-qualified stock option agreement for executive officers, except as provided below. The Options shall also vest in accordance with the following stock performance targets for the Corporation’s Common Stock: one third of each Option grant shall vest upon the Corporation’s Common Stock achieving a market price of five dollars ($5.00) per share greater than the Fair Market Value of the Corporation’s Common Stock on the Date of Grant; one-third of each Option grant shall vest upon the Corporation’s Common stock achieving a market price of ten dollars ($10.00) per share greater than the Fair Market Value of the Corporation’s Common Stock on the Date of Grant; and the remaining one-third of each Option grant shall vest upon the Corporation’s Common Stock achieving a market price of fifteen dollars ($15.00) per share greater than the Fair Market Value of the Corporation’s Common Stock on the Date of Grant; provided, however, that in no event shall an option be exercised for the first six (6) months following a Date of Grant. Notwithstanding the foregoing, (A) subject to Executive’s continued employment on the effective date of a Change of Control, upon the occurrence of the Change of Control (as defined in the Corporation’s applicable stock option plan), (x) all unvested and unexercisable shares subject to any Option granted prior to the Change of Control shall become fully exercisable and vested and (y) any Option not previously granted shall be granted as of immediately prior the effective date of the Change of Control with a strike price equal to the Fair Market Value of the Corporation’s Common Stock on the date the Option is granted and shall be vested and fully exercisable upon grant; and (B) upon termination of Executive’s employment by the Corporation other than for Cause or by the Executive for Good Reason, (x) all unvested and unexercisable shares subject to any Option granted shall become vested and fully exercisable and (y) any remaining Option not previously granted shall be immediately granted with a strike price equal to the Fair Market Value on the date the Option is granted and shall be vested and fully exercisable upon grant.”

8. Section 3(h) of the Employment Agreement shall be amended by deleting:

“The Executive shall be eligible to receive for the Fiscal Year (calendar) 1999 and for each fiscal year therefore during the Employment Period,”

And replacing it with:

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“The Executive shall be eligible to receive for the Fiscal Year (calendar) 1999 and for each fiscal year therefore during the Employment Period ending on or prior to December 31, 2008,”

9. References in Section 3(h) of the Employment Agreement to “7,500 shares” shall be amended, effective as of May 12, 1999, to read “11,250 shares” and the reference to “15,000 shares” shall be amended as of the same date to read “22,500 shares”, such amendment to reflect the Corporation’s 3:2 stock split which was effective on May 12, 1999.

10. Section 3(h) of the Employment Agreement shall be further amended to insert the following at the end of such Section:

“Effective January 1, 2009, the Executive shall be eligible to receive for fiscal (calendar) year 2009 and for each fiscal year thereafter during the Employment Period up to 33,750 shares of the Corporation’s Common Stock as a Performance Restricted Stock Award, such Performance Restricted Stock Award to be granted pursuant to the Corporation’s 2008 Omnibus Incentive Compensation Plan (or such other plan applicable to executives of the Corporation in effect from time to time) on the following basis: (i) if the Committee determines that seventy percent (70%) or more of the applicable performance targets set by the Board of Directors for such fiscal year have been met, the Executive shall receive 11,250 shares; and (ii) if the Committee determines that eighty percent (80%) or more of the applicable performance targets set by the Board of Directors for such fiscal year have been met, the Executive shall receive 11,250 shares; and (iii) if the Committee determines that one hundred fifteen percent (115%) or more of the applicable performance targets set by the Board of Directors for such fiscal year have been met, the Executive shall receive an additional 11,250 shares. Each Performance Restricted Stock Award shall be awarded to the Executive promptly after the end of the applicable fiscal year as soon as the Committee has determined that the applicable targets have been met but in no event later than sixty days after the end of the applicable fiscal year. Of the 11,250 shares of Corporation Common Stock referred to in clause (i) above, the disposition of such shares by the Executive shall be restricted for a period of three years, with such restrictions lapsing as to one-third of such shares on each of the first three anniversaries of the date the shares are granted to the Executive. Of the 11,250 shares of Corporation Common Stock referred to in clause (ii) above, the disposition of the shares by the Executive shall be restricted for a period of one year from the date the shares are granted to the Executive. The disposition of the shares referred to in clause (iii) by the Executive shall be restricted for a period of one year from the date the shares are granted to the Executive.”

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11. The first sentence of Section 5(a)(i) of the Employment Agreement shall be amended by adding the phrase “or Target Award” after the term “Semi-Annual Cash Bonus”.

12. Section 5(a)(iii) of the Employment Agreement shall be amended by deleting the phrase “two times the maximum Semi-Annual Cash Bonus for the current six month period” and inserting the phrase “two times the Target Award for the current six month period (whether or not earned).”

13. Section 5(a)(iv) of the Employment Agreement is amended by adding the following sentence at the end thereto:

“The parties intend that the first eighteen months of medical and welfare benefit coverage shall be exempt from the application of Section 409A of the Code, and that any remaining payments by the Company for these benefits shall be made on a monthly basis and considered in compliance with Section 409A of the Code. If the Corporation reimburses the Executive for the amount of any such benefit under this Section 5(a)(iv), such reimbursement shall be made promptly in accordance with Company policy, but in any event on or before the last day of the Executive’s taxable year following the taxable year in which the expense or cost was incurred. In no event shall the amount that the Company pays for any such benefit in any one year affect the amount that it will pay in any other year and in no event shall the benefits described in this paragraph be subject to liquidation or exchange.”

14. Section 5 of the Employment Agreement is amended by adding a new subsection (c) to read as follows:

“(c) Notwithstanding the payment schedules contained elsewhere in this Section 5, to the extent necessary to comply with the requirements of Section 409A of the Code, if the Executive is a ‘specified employee’ (as defined below) at the time of his termination of employment, the payments under Sections 5(a)(i)(3), 5(a)(ii) and 5(b) (to the extent relating to the payment of compensation previously deferred by the Executive) shall not be made before the date which is six months after the date of the Executive’s termination of employment (or, if earlier, the date of his death). For purposes of the preceding sentence, a ‘specified employee’ shall have the meaning set forth in Section 1.409A-1(i) of the Final Regulations under Section 409A of the Code. Any payments that are so delayed will be paid in full within thirty days after the end of the six month period described in the first sentence, with the remaining payments being made on the schedule provided in the applicable subsection of this Section 5.”

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15. Section 7 of the Employment Agreement is amended by adding a new subsection (d) to read as follows:

“(d) Any Gross-Up Payment required to be paid under this Section 7 shall be paid no later than the end of the Executive’s taxable year next following the Executive’s taxable year in which the Executive pays the Excise Tax to which the Gross-Up Payment relates to the United States Internal Revenue Service or other applicable taxing authority.”

16. Section 8(b) of the Employment Agreement is amended by adding the following sentence at the end of such subsection:

“Notwithstanding the payment schedule contained in this Section 8(b), to the extent necessary to comply with the requirements of Section 409A of the Code, if the Executive is a ‘specified employee’ (as defined above) at the time of his termination of employment, the payments to be made to the Executive during the Mandatory Non-Competition Period shall not be made before the date which is six months after the date of the Executive’s termination of employment. Any payments that are so delayed will be paid in full within thirty days after the end of such six months period, with the remaining payments being made on the schedule provided in this Section 8(b).”

17. Section 11 of the Employment Agreement is amended by adding a new subsection (h) to read as follows:

“(h) This Employment Agreement is intended to comply with Section 409A of the Code and shall be construed and administered in accordance thereof, to the extent applicable. If any provision herein should violate Section 409A, such provision shall be deemed amended as of the date hereof without the necessity of further action by the Board so as to comply with Section 409A.”

18. Section 12(b) of the Employment Agreement shall be amended to read in its entirety as follows:

All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to the Executive:

Alan F. Schultz

c/o Valassis Communications, Inc.

19975 Victor Parkway

Livonia, MI 48152

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If to the Corporation:

c/o Valassis Communications, Inc.

19975 Victor Parkway

Livonia, MI 48152

Attention: Todd L. Wiseley

or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee. A copy of all notices and communications, whether sent to the Executive or the Corporation, shall be sent to:

McDermott Will & Emery LLP

340 Madison Avenue

New York, New York 10173-1922

Attention: Amy Leder, Esq.

19. All other terms of the Employment Agreement shall remain in full force and effect.

20. This instrument, together with the Employment Agreements contains the entire agreement of the parties with respect to the subject matter hereof.

IN WITNESS WHEREOF, the Executive and the Corporation have caused this Agreement to be executed as of the day and year first above written.

VALASSIS COMMUNICATIONS, INC.
By:	/s/ Todd Wiseley
Name:	Todd Wiseley
Title:	Secretary
/s/ Alan F. Schultz
Alan F. Schultz

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EX-99.1

Exhibit 99.1

Press Release

FOR IMMEDIATE RELEASE

Valassis Extends CEO’s Contract for Three More Years

Alan F. Schultz’s Contract Continues Through January 2012

Livonia, Mich., May 13, 2008: Valassis (NYSE: VCI), one of the nation’s leading marketing services companies, is pleased to announce that Alan F. Schultz, Valassis Chairman, President and Chief Executive Officer, has agreed to a three-year extension of his employment agreement.

Schultz’s previous contract was set to expire on Dec. 31, 2008, and under the new agreement, he will continue to lead Valassis through January 2012.

“I have studied leadership my entire career – as a West Point military officer, automotive business executive, entrepreneur and board member of several publicly held companies,” said Board member Joseph B. Anderson Jr., Chairman of Valassis’ Corporate Governance/Nominating Committee. “Al stands out as the highest example of leadership. He had a vision and has led his team to execute this vision despite significant opposition. Valassis is fortunate to have a leader of his caliber.”

Under Schultz’s leadership, the company has nearly quadrupled revenues and significantly diversified its customer base and product portfolio. In March of 2007, he led the company through a $1.2 billion acquisition of ADVO, Inc., the nation’s largest direct mail marketer. Today, shared mail represents more than half of the company’s revenue, and the significant improvements made to this business have contributed greatly to the company’s strong financial performance since the acquisition. On May 1, 2008, Valassis reported its third consecutive quarter of earnings growth. This positive momentum is evidence of the strong strategic rationale behind the shared mail acquisition and business integration plan.

“Al drove this acquisition under enormous scrutiny by investors, Board members and employees,” said Kenneth V. Darish, Presiding Director. “He believed the acquisition would improve earnings and brighten the future of Valassis. He was right and his vision continues to come to life with each step in the integration process. The Board has tremendous confidence in him.”

Wallace S. Snyder, President and Chief Executive Officer of the American Advertising Federation, and Valassis Board member, lauds Schultz for his strategic thinking and positioning Valassis at the forefront of consumer and client trends. “He has transformed Valassis from essentially a one-product company serving the consumer packaged goods industry to a global company offering more than 20 products and services to clients in a variety of industries.”

Schultz is quick to point out the company’s success is the result of a collaborative effort. “It is my privilege and honor to work with an incredibly talented and results-driven team,” Schultz said. “Our continued success is a tribute to the dedication of many and the spirit of teamwork throughout the company.”

Valassis has been recognized throughout Schultz’s leadership for its best place to work practices, corporate citizenship, business ethics, products, innovation and diversity.

“Al has been a true champion for diversity and has brought about real change at the company,” said Board member Marcella A. Sampson. “Today, 38% of Valassis associates are minorities. I have had the privilege of working with Al closely during the last 10 years. He has a true desire to make the company one of the best places to work for everyone.”

Schultz joined Valassis from Deloitte and Touche in 1984 and has held leadership positions throughout the company, including sales, marketing, operations and finance. He assumed his current role at Valassis in 1998.

Interested parties can review details of the employment agreement amendment by consulting the Form 8-K filed by the company today with the Securities and Exchange Commission.

About Valassis

Valassis is one of the nation’s leading marketing services companies, offering unparalleled reach and scale to more than 15,000 advertisers. Its RedPlum media portfolio delivers value on a weekly basis to over 100 million shoppers across a multi-media platform – in-home, in-store and in-motion. Through its newest offering – redplum.com – consumers will find compelling national and local deals online. Headquartered in Livonia, Michigan with approximately 7,000 associates in 28 states and nine countries, Valassis is widely recognized for its associate and corporate citizenship programs, including its America’s Looking for Its Missing Children^® program. Valassis companies include Valassis Direct Mail, Inc., Valassis Canada, Promotion Watch, Valassis Relationship Marketing Systems, LLC and NCH Marketing Services, Inc. For more information, visit http://www.valassis.com or http://www.redplum.com.

Safe Harbor and Forward-Looking Statements

Certain statements found in this document constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks and uncertainties and other factors which may cause the actual results, performance or achievements of Valassis to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: price competition from Valassis’ existing competitors; new competitors in any of Valassis’ businesses; a shift in client preference for different promotional materials, strategies or coupon delivery methods; an unforeseen increase in Valassis’ paper or postal costs; changes which affect the businesses of Valassis’ clients and lead to reduced sales promotion spending; challenges and costs of achieving synergies and cost savings in connection with the acquisition of ADVO and integrating ADVO’s operations may be greater than expected; Valassis’ substantial indebtedness, and its ability to incur additional indebtedness, may affect Valassis’ financial health; certain covenants in Valassis’ debt documents could adversely restrict Valassis’ financial and operating flexibility; fluctuations in the amount, timing, pages, weight and kinds of advertising pieces from period to period, due to a change in Valassis’ clients’ promotional needs, inventories and other factors; Valassis’ failure to attract and retain qualified personnel may affect its business and results of operations; a rise in interest rates could increase Valassis’ borrowing costs; the outcome of ADVO’s pending shareholder lawsuits; possible governmental regulation or litigation affecting aspects of Valassis’ business; and general economic conditions, whether nationally or in the market areas in which Valassis conducts its business, may be less favorable than expected. These and other risks and uncertainties related to Valassis’ business are described in greater detail in its filings with the United States Securities and Exchange Commission, including Valassis’ reports on Forms 10-K and 10-Q, and the foregoing information should be read in conjunction with these filings. Valassis disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Media Contact:

Mary Broaddus

Director, Corporate Communications

734-591-7375

broaddusm@valassis.com