EXHIBIT 10.21

 

Summary of Non-Employee Director Compensation

 

The following is a summary of the compensation provided by Factory Card & Party
Outlet Corp. to non-employee directors for service as a director:

 

Director Fees

 

Non-employee directors receive $27,500 per year for serving as a director,
$1,000 for attending a regular or special board meeting or committee meeting
($500 if attended by telephone), plus reimbursement of all reasonable travel and
out-of-pocket expenses associated with attending such meeting. The Chairman of
the Compensation Committee receives an additional annual fee of $7,000, and the
Chairman of the Audit Committee receives an additional annual fee of $5,000. The
Chairman of the Board receives an additional annual fee of $32,500.

 

Non-employee directors participate in one equity compensation plan of the
Company, the 2002 Non-Employee Directors Stock Option Plan. The Board has a
policy for the annual grant of non-qualified stock options to purchase 5,000
shares of the Company’s Common Stock to continuing non-employee directors. All
options granted to such directors will have an exercise price equal to 100% of
the fair market value on the date of grant and will vest over a three-year
period from the grant date.

 

Additionally, the Board has a policy that the Non-Executive Chairman of the
Board will receive at the same time additional non-qualified stock options in
the amount of 5,000 shares, which options will have the same exercise price and
will also vest over a three-year period from the grant date.