Exhibit 10.21

 

SEPARATION AGREEMENT

 

THIS AGREEMENT IS ENTERED INTO ON April 16, 2004, by and between Robert S.
Pyzdrowski (“Executive”) and R.R. Donnelley & Sons Company, its subsidiaries,
affiliates, predecessors, successors and assigns (the “Company”) in connection
with Executive’s termination of employment with the Company.

 

IN CONSIDERATION OF the payments, obligations and promises set forth in this
agreement (the “Separation Agreement”), Executive and the Company agree as
follows:

 

1. Executive’s employment with the Company shall end effective March 31, 2004
(the “Final Separation Date”). Executive will be relieved of the duties as
President, Solution Delivery of the Company effective as of March 31, 2004.
Executive’s last day in office will be March 31, 2004. However, during the
period from March 1, 2004 through the Final Separation Date, Executive will
continue to be employed by the Company and provide consultative service as
requested by the Company at mutually agreeable times involving no unreasonable
delays. During this period, the Company will pay Executive the base salary and
provide benefits at the same levels as they exist as of the date hereof.

 

2. Executive represents and agrees that as of the date hereof Executive is in
compliance with, not aware of any material violations of, and will comply with
any continuing obligations under all Company policies and covenants provided in
this Separation Agreement, including, but not limited to those provided in
paragraphs 6, 7, 11, 13, and 16.

 

3. Pursuant to the Company’s reasonable request, Executive agrees to fully
cooperate with the Company in connection with any investigations, inquiries,
actions, suits, claims or proceedings involving the Company.

 

4. Executive does hereby formally resign as of March 1, 2004 from all of
Executive’s appointments, offices and directorships with the Company including
President, Solution Delivery. Executive further agrees to fully cooperate and
resign from any other Company appointments, offices and directorships, if any,
including promptly executing any documents necessary to effect these
resignations.

 

5. Executive agrees to return to the Company within five days of the date
hereof, all Company documents, files, electronic information, equipment, and
other property currently in Executive’s possession. Executive will also agree
promptly to transfer to the Company any and all subscriptions, season tickets
and memberships currently in Executive’s name which are paid for by the Company.

 

6. Executive agrees that the confidentiality obligations set forth in the
Company’s policies shall continue in full force and effect from and after the
date hereof, and Executive further agrees that from and after the date hereof,
Executive will not disclose

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any confidential information regarding the Company to any third party or
otherwise discuss the Company’s business, operations, affairs or prospects with
any third party without the written consent of the Company, which may be
withheld by the Company in the Company’s sole and absolute discretion.

 

7. Executive agrees that through the Final Separation Date and for twelve (12)
months after the Final Separation Date, Executive will not (i) accept a position
with, or provide material services to, an entity that competes with a portion of
the Company’s business representing more than $25 million of the Company’s
revenues on the Final Separation Date, (ii) solicit or hire, or assist others in
the solicitation or hiring of, the Company’s employees, or (iii) interfere with
the Company’s business relationships with any material customers or suppliers.

 

8. In consideration for signing and returning both (i) the Separation Agreement,
and (ii) the Updated Release attached hereto as Annex A no earlier than the
Final Separation Date, and not revoking either document within the applicable
revocation periods, and provided that Executive is in compliance with all of the
terms of and conditions of the Separation Agreement and has not breached
Executive’s obligations hereunder, Executive will receive the following
separation benefits:

 

a. Severance Pay. Executive will receive $42,875.00 per month for twelve (12)
months (the “Severance Period”). Of this amount, $6,596.15 per week for
forty-one (41) weeks represents “Regular Separation Pay” under the terms of the
RR Donnelley Separation Pay Plan (“Separation Plan”). For more information as to
the determination of your Regular Separation Pay, please see the Separation
Plan’s Summary Plan Description (“SPD”), a copy of which is included with these
materials. Notwithstanding the foregoing, Executive will be entitled to 25% of
his Regular Separation Pay even if Executive fails to sign either (i) the
Separation Agreement, or (ii) the Updated Release, or signs both documents but
revokes either or both of the documents within the applicable revocation
periods;

 

b. Special Payment. Executive will receive a single lump-sum payment in the
amount of $100,810.00, which represents an amount that is roughly equivalent to
the pro-rata amount that Executive would have accrued under the Company’s 3-year
Long Term Incentive Compensation Plan;

 

c. COBRA Subsidy. The Company will subsidize Executive’s health care
continuation benefits, for Executive and any eligible dependents that were
covered during his employment, for a twelve (12) month period. The details of
the COBRA subsidy are discussed at length in the included Separation Plan SPD;

 

d. Financial Planning Account. Executive will be entitled to utilize the amount
currently accrued in his Company Financial Planning Account for purposes
authorized under the Financial Planning Account plan only, provided that such
services are incurred during the 12 month Severance Period;

 

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e. Outplacement Services. Executive shall be entitled to up to $40,000.00 of
outplacement services utilized by Executive from an outplacement service
provider of Executive’s choice, provided that such services are utilized within
the 12 month Severance Period;

 

f. Supplemental Life and Disability Insurance. With respect to each of
Executive’s supplemental life and disability insurance policies for which the
Company has been reimbursing Executive for premium payments, the Company shall
reimburse Executive only for premium payments that are due on or prior to the
Final Separation Date. After the Final Separation Date, the Company shall have
no responsibility with respect to such supplemental insurance policies and
payment of policy premiums due on such policies after the Final Separation Date
will be the sole responsibility of Executive.

 

9. Executive will receive a lump sum payment in lieu of all accrued but unused
vacation days as of the Final Separation Date whether or not the Separation
Agreement becomes effective. This shall include, without duplication, 12 unused
vacation days attributable to Executive’s vacation allotment for 2003, and any
banked vacation days, and any unused vacation days earned and accrued in 2004
prior to the Final Separation Date.

 

10. All payments made pursuant to this Separation Agreement shall be reduced by
applicable tax withholdings. All periodic payments made under this Separation
Agreement shall be paid in accordance with usual Company payroll practices, as
they may be in effect from time to time, by automatic direct deposit into an
account designated by Executive beginning with the month following the Effective
Date of the attached Updated Release. All lump-sum payments made under this
Separation Agreement shall be paid as soon as administratively practicable after
the Effective Date of the attached Updated Release.

 

11. Executive agrees for himself and others acting on his behalf, that he (and
they) have not and will not disparage, make negative statements about or act in
any manner which is intended to or does damage to the good will of, or the
business or personal reputations of the Company or any of their incumbent or
former officers, directors, agents, consultants, employees, successors and
assigns.

 

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12. For and in consideration of the payments, benefits and other things of value
to be provided pursuant to this Separation Agreement, Executive agrees,
knowingly and voluntarily, to release and forever discharge the Company and the
current and former shareholders, employees, officers, directors, consultants,
representatives and agents thereof, of and from any and all claims, liabilities,
demands or causes of action known and unknown, that Executive has, ever had or
could have had as of the date hereof, arising out of or in any way connected
with or related to this Separation Agreement, Executive’s employment by the
Company or the cessation of Executive’s employment (this “Release”). This total
and unlimited release includes, but is not limited to, any claims based on any
local, state or federal statute, or other regulations or laws (including common
law):

 

  • Relating to bias based on Executive’s age, sex, religion, religious creed,
citizenship, color, race, ancestry, national origin, veteran, familial or
marital status, sexual orientation or preference, genetic predisposition or
carrier status, physical or mental disability or past or present history of the
same or any other form of discrimination, harassment or retaliation, including,
without limitation, the Age Discrimination in Employment Act of 1967, as amended
(“ADEA”)), the Older Workers Benefit Protection Act, Title VII of the Civil
Rights Act, the Americans with Disabilities Act, the Illinois Human Rights Act,
the Illinois Equal Pay laws, the Cook County Human Rights Ordinance, and the
Chicago Human Rights Ordinance;

 

  • Relating to the Worker Adjustment and Retraining Notification Act (“WARN”);

 

  • Any claim under the Family and Medical Leave Act;

 

  • For wrongful discharge, harassment or retaliation;

 

  • Relating to any implied or express contract (whether oral or written);

 

  • For intentional or negligent infliction of emotional harm, defamation or any
other tort;

 

  • For fraud or conversion;

 

  • In connection with continuation of sponsored health benefits; and

 

  • For costs, fees or other expenses including attorneys’ fees and
disbursements.

 

This Separation Agreement does not waive or otherwise impair any rights that
Executive may have under the terms of any health or welfare plan maintained by
the Company or any vested rights under any tax-qualified retirement plan.
Executive’s severance benefits will be limited to those described in this
Separation Agreement, and except as otherwise provided herein, Executive’s
participation in any Company-sponsored employee benefit plan shall cease as of
the Final Separation Date.

 

If any provision of this Separation Agreement is held by a court of competent
jurisdiction to be illegal, void or unenforceable, such provision shall have no
effect; however, the remaining provisions shall be enforced to the maximum
extent possible. Further, if a court should determine that any portion of this
Separation Agreement is overbroad or unreasonable, such provision shall be given
effect to the maximum extent possible by narrowing or enforcing in part that
aspect of the provision found overbroad or unreasonable.

 

13. Executive agrees that the terms of this Separation Agreement are and shall
remain strictly confidential and shall not be disclosed to any third party,
other than to Executive’s attorney or other advisors, or Executive’s spouse for
purposes of considering whether to sign this Separation Agreement; provided that
Executive discloses to such persons the existence of this confidentiality
provision and such persons agree to maintain the confidentiality thereof, and
provided further that Executive shall be fully responsible for any breach by any
such person of this confidentiality provision. In the event any third party
inquires about Executive’s employment or separation from employment with the
Company, Executive agrees to respond that Executive was treated fairly by the
Company, its affiliates and subsidiaries.

 

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14. This Separation Agreement is not intended, and shall not be construed, as an
admission that the Company has violated any federal, state or local law
(statutory or decisional), ordinance or regulation, breached any contract or
committed any wrong whatsoever against Executive.

 

15. By signing this Separation Agreement, and initialing each of the following
statements, Executive expressly acknowledges and agrees that:

 

Ÿ Executive has read and fully understands the terms of this Separation
Agreement; [    ]

 

Ÿ Executive acknowledges and agrees that the payments, benefits and/or other
things of value provided pursuant to this Separation Agreement: (i) are in full
discharge of any and all liabilities and obligations of the Company to
Executive, monetarily or with respect to employee benefits or otherwise,
including but not limited to any and all obligations arising under any alleged
written or oral employment agreement, policy, plan or procedure of the Company
and/or any alleged understanding or arrangement between Executive and the
Company; and (ii) exceed any payment, benefit, or other thing of value to which
Executive might otherwise be entitled under any policy, plan or procedure of the
Company and/or any agreement between Executive and the Company; [    ]

 

Ÿ Executive understands that (i) this Separation Agreement sets forth the entire
agreement between us, and fully supersedes any prior agreements or
understandings between the parties and (ii) this Separation Agreement and the
attached Updated Release constitute a release by Executive of all claims, known
and unknown, which relate to Executive’s employment or separation from
employment; [    ]

 

Ÿ The Company advised Executive to consult an attorney prior to signing this
Separation Agreement and the attached Updated Release; [    ]

 

Ÿ Executive has had adequate opportunity to request, and has received, all
information Executive needs to understand this Separation Agreement and has been
offered at least forty-five (45) days to consider the terms of this Separation
Agreement and the information attached at Annex B which is provided pursuant to
the Older Workers Benefit Protection Act, and Executive agrees that any
modifications, material or otherwise, made to this Separation Agreement shall
not restart or affect in any manner the original forty-five (45) calendar day
consideration period; and [    ]

 

Ÿ Executive has knowingly and voluntarily entered this Separation Agreement,
without any duress, coercion or undue influence by anyone. [    ]

 

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16. Executive represents and warrants that as of the date hereof Executive has
not filed any complaints, charges, or claims for relief against the Company, any
of its past or present officers, directors, employees, consultants or agents
arising out of any acts or omissions they allegedly may have committed in
connection with this Separation Agreement, Executive’s employment or the
termination of such employment with any local, state or federal court or
administrative agency and has not authorized any other person or entity to
assert such a claim on Executive’s behalf. Other than for claims arising under
the ADEA, Executive also agrees, to the fullest extent permitted by law, not to
commence, encourage, facilitate or participate in any action or proceeding for
damages, reinstatement, injunctive or any other type of relief, in any state,
federal or local court or before any administrative agency, relating to this
Separation Agreement or the attached Updated Release, the enforceability of any
provision thereof or Executive’s employment with the Company or the termination
thereof.

 

17. Any controversy or claim arising out of or relating to this Separation
Agreement or the breach of this Separation Agreement that cannot be resolved by
Executive and the Company, including any dispute as to the calculation of any
payments hereunder, and the terms of this Separation Agreement, shall be
determined by a single arbitrator in Chicago, Illinois, in accordance with the
National Rules for the Resolution of Employment Disputes of the American
Arbitration Association then in effect. The decision of the arbitrator shall be
final and binding and may be entered in any court of competent jurisdiction. The
arbitrator may award the party he determines has prevailed in the arbitration
any legal fees and other fees and expenses that may be incurred in respect of
enforcing its respective rights under this Separation Agreement. This Separation
Agreement shall be interpreted in accordance with the laws of the State of
Illinois.

 

18. Executive agrees that, if the Company is required to take any legal action
to enforce Executive’s obligations under this Separation Agreement for any
reason, except any claim arising under the ADEA, executive shall be responsible
for all costs incurred by the Company to enforce Executive’s obligations
thereunder including, without limitation, reasonable attorneys fee and expenses.

 

19. All notices or communications under this Separation Agreement must be in
writing, addressed; (i) if to the Company, to the attention of the Senior Vice
President, Human Resources, 77 W. Wacker Drive Chicago, IL 60601-1696 and (ii)
if to Executive, at Executive’s last known address (or to any other addresses as
either party may designate in a notice duly delivered as described in this
paragraph). Any notice or communication shall be delivered by fax (with proof of
transmission), by hand or by courier (with proof of delivery). Notices and
communications may also be sent by certified or registered mail, return receipt
requested, postage prepaid, addressed as above and the third business day after
the actual date of mailing shall constitute the time at which notice was given.

 

20. This Separation Agreement will become effective on the eighth day after
Executive signs it. During the seven (7) days after Executive signs this
Separation Agreement, Executive may revoke it by giving written notice to R.R.
Donnelley & Sons Company, to the attention of the Senior Vice President, Human
Resources, 77 W.

 

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Wacker Drive Chicago, IL 60601-1696, in which event this Separation Agreement
will not go into effect. If the last day of the revocation period is a Saturday,
Sunday or legal holiday in the State of Illinois, then the revocation period
shall not expire until the next business day.

 

AGREED AND ACCEPTED: /s/    Robert S. Pyzdrowski

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Name:

  Robert S. Pyzdrowski

 

 

R.R. DONNELLEY & SONS COMPANY By:   /s/    Andrew B. Panega    

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Name:

  Andrew B. Panega

Title:

  SVP Human Resources

 

 

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Annex A

 

UPDATED RELEASE

 

In consideration of the receipt of the payments and benefits described in the
Separation Agreement dated                 , 2004 (the “Separation Agreement”),
Executive knowingly and voluntarily releases and forever discharges R.R.
Donnelley & Sons Company, its affiliates, subsidiaries, divisions, successors
and assigns (the “Company”) and the current and former shareholders, employees,
officers, directors, consultants, representatives and agents thereof, of and
from any and all claims, liabilities, demands or causes of action, known and
unknown, that Executive has, ever had or could have had as of the date hereof
arising out of or in any way connected with or related to Executive’s employment
by the Company or the termination of Executive’s employment (this “Release”).
This total and unlimited release includes, but is not limited to, any claims
based on any local, state or federal statute, or other regulations or laws
(including common law):

 

  • Relating to bias based on Executive’s age, sex, religion, religious creed,
citizenship, color, race, ancestry, national origin, veteran, familial or
marital status, sexual orientation or preference, genetic predisposition or
carrier status, physical or mental disability or past or present history of the
same or any other form of discrimination, harassment or retaliation, including,
without limitation, the Age Discrimination in Employment Act of 1967, as amended
(“ADEA”)), the Older Workers Benefit Protection Act, Title VII of the Civil
Rights Act, the Americans with Disabilities Act, the Illinois Human Rights Act,
the Illinois Equal Pay laws, the Cook County Human Rights Ordinance, and the
Chicago Human Rights Ordinance;

 

  • Relating to the Worker Adjustment and Retraining Notification Act (“WARN”);

 

  • Any claim under the Family and Medical Leave Act;

 

  • For wrongful discharge, harassment or retaliation;

 

  • Relating to any implied or express contract (whether oral or written);

 

  • For intentional or negligent infliction of emotional harm, defamation or any
other tort;

 

  • For fraud or conversion;

 

  • In connection with continuation of sponsored health benefits; and

 

For costs, fees or other expenses including attorneys’ fees and disbursements.

 

The Separation Agreement does not waive or otherwise impair any rights that
Executive may have under the terms of any health or welfare plan maintained by
the Company or any vested rights under any tax-qualified retirement plan.
Executive’s severance benefits will be limited to those described in the
Separation Agreement, and except as otherwise provided herein, Executive’s
participation in any Company-sponsored employee benefit plan shall cease as of
the Final Separation Date.

 

Executive represents and agrees that as of the date hereof Executive is in
compliance with, not aware of any material violations of, and will comply with
any

 

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continuing obligations under all Company policies and covenants provided in the
Separation Agreement, including, but not limited to those provided in paragraphs
6, 7, 11, 13, and 16.

 

Executive represents and warrants that as of the date hereof Executive has not
filed any complaints, charges, or claims for relief against the Company, any of
its past or present officers, directors, employees, consultants or agents
arising out of any acts or omissions they allegedly may have committed in
connection with the Separation Agreement, Executive’s employment or the
termination of such employment with any local, state or federal court or
administrative agency and has not authorized any other person or entity to
assert such a claim on Executive’s behalf.

 

Executive has had an adequate opportunity to request, and has received, all
information Executive needs to understand this Updated Release and has been
offered at least forty-five (45) days to consider the terms of this Updated
Release and the information attached at Annex B which is provided pursuant to
the Older Workers Benefit Protection Act, and Executive agrees that any
modifications, material or otherwise, made to the Separation Agreement shall not
restart or affect in any manner the original forty-five (45) calendar day
consideration period.

 

Executive has knowingly and voluntarily executed this Updated Release without
any duress, coercion or undue influence by anyone.

 

This Updated Release will become effective on the eighth day after Executive
signs it. During the seven (7) days after Executive signs this Updated Release,
Executive may revoke it by giving written notice to R.R. Donnelley & Sons
Company, to the attention of the Senior Vice President, Human Resources, 77 W.
Wacker Drive Chicago, IL 60601-1696, in which event neither this Updated Release
nor the obligation to provide any unpaid payments or benefits provided under the
Separation Agreement shall go into effect. If the last day of the revocation
period is a Saturday, Sunday or legal holiday in the State of Illinois, then the
revocation period shall not expire until the next business day.

 

If any provision of this Updated Release is held to be illegal, void, or
unenforceable, such provision shall have no effect; however, the remaining
provisions shall be enforced to the maximum extent possible.

 

Dated:

                

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        Robert S. Pyzdrowski

 

 

 

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February 29, 2004

 

Annex B

 

DISCLOSURE INFORMATION PROVIDED

PURSUANT TO THE OLDER WORKERS BENEFIT PROTECTION ACT

 

Time Limitations and Eligibility Factors

 

In connection with the combination of R.R. Donnelley & Sons Company (“RRD”), and
Moore-Wallace, Inc. (“MW”), the employment of certain employees will be
terminated. All employees of both RRD and MW occupying positions between the
level of Vice President and divisional President comprise the decisional unit.
Employees selected for termination on or before March 31, 2004 in connection
with the combination are being offered additional severance benefits in exchange
for their signing a Separation Agreement and Updated Release.

 

Employees who have been selected for termination and who desire to receive the
additional severance benefits have at least forty-five (45) days from the date
of receipt of this disclosure information and the attached Separation Agreement
and Updated Release to sign the Separation Agreement and the Updated Release.
They may receive the additional severance benefits by signing the Separation
Agreement, and also by signing the Updated Release no earlier than their last
day of employment and returning both documents to R.R. Donnelley & Sons Company,
to the attention of the Senior Vice President, Human Resources, 77 W. Wacker
Drive Chicago, IL 60601-1696. The Separation Agreement, and the Updated Release
shall each become effective on the eighth (8th) day following their being signed
(respectively, the Separation Agreement Effective Date, and the Updated Release
Effective Date).

 

Employees may, at any time prior to the Separation Agreement Effective Date or
the Updated Release Effective Date, revoke the Separation Agreement or the
Updated Release by giving notice in writing of such revocation to the Senior
Vice President, Human Resources, at the address above, by the seventh (7th) day
after they sign each document, except that if the seventh (7th) day following
the date the employee signs either document falls on a Saturday, Sunday or legal
holiday, then the last day of the revocation period shall be the next business
day, and the applicable effective date shall be the following day.

 

In accordance with law, RRD is disclosing to you the job titles and dates of
birth of the employees selected and not selected for termination in this
program.

 

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