Exhibit 10.21

 

R.R. DONNELLEY & SONS COMPANY

DIRECTOR RESTRICTED STOCK UNIT AWARD

 

This Restricted Stock Unit Award (“Award”) is granted as of this             
day of                  (the “Grant Date”) by R.R. Donnelley & Sons Company, a
Delaware corporation (the “Company”), to                                 
(“Grantee”). This Award is made to Grantee pursuant to the provisions of the
Company’s 2004 Performance Incentive Plan (the “2004 PIP”). Capitalized terms
not defined herein shall have the meanings specified in the 2004 PIP.

 

1. Grant of Award. The Company hereby credits to Grantee
                         restricted stock units (the “RSUs”), subject to the
restrictions and on the terms and conditions set forth herein. Grantee shall
indicate acceptance of this Award by signing and returning a copy hereof.

 

2. Issuance of Common Stock in Satisfaction of Restricted Stock Units.

 

(a) On the earlier of (i) the third anniversary of the Grant Date and (ii) the
date the Grantee ceases to be a member of the Board of Directors of the Company
(the “Board”), the number of shares of Common Stock (or, in the Company’s
discretion, cash based on the fair market value of the Common Stock on the date
of distribution) equal to one-third of the RSUs (the “First Tranche RSUs”) shall
be delivered to the Grantee; provided, however, that the Grantee may elect to
defer the delivery of the shares of Common Stock (or cash) underlying the First
Tranche RSUs until the date such Grantee ceases to be a member of the Board by
delivering the Deferral Election attached hereto as Exhibit A within one year of
the Grant Date. THE RIGHT TO DEFER DELIVERY OF THE SHARES UNDERLYING THE FIRST
TRANCHE RSUs SHALL LAPSE IF NOT EXERCISED BY THE ONE YEAR ANNIVERSARY OF THE
GRANT DATE.

 

(b) On the date the Grantee ceases to be a member of the Board, shares of Common
Stock (or, in the Company’s discretion, cash based on the fair market value of
the Common Stock on the date of distribution) with respect to the remaining
two-thirds of the RSUs (the “Second Tranche RSUs”) or 100% of the RSUs if the
Grantee so elects by delivery of Exhibit A, shall be delivered to the Grantee.

 

(c) Each RSU shall be cancelled upon the issuance of a share of Common Stock (or
cash) with respect thereto.

 

3. Fractional Shares. Any fractional shares of Common Stock that would otherwise
be deliverable on the date Grantee ceases to be a member of the Board or the

 

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third anniversary of the Grant Date, as applicable, shall be paid in cash based
upon the fair market value of a share of Common Stock on the date of
distribution.

 

4. Dividends. Dividends or other distributions that are payable (other than
dividends or distributions for which the record date is prior to the date
hereof) during the period commencing on the date hereof and ending on the date
on which no RSUs shall remain outstanding (due to issuance of shares of Common
Stock (or cash) in satisfaction of RSUs pursuant to paragraph 3) on a like
number of shares of Common Stock as are equal to the number of RSUs then
outstanding shall be credited to a book keeping account for the Grantee. Such
accounts shall be credited quarterly (beginning on the last day of the calendar
quarter in which the first credit to the account was made) with an amount of
interest on the balance (including interest previously credited) at an annual
rate equal to the then current yield obtainable on United States government
bonds having a maturity date of approximately five years. The entire amount in
such account shall be paid out on the date the Grantee ceases to be a member of
the Board (the “Dividend Equivalents”).

 

5. Rights as a Shareholder. Prior to issuance, Grantee shall not have the right
to vote, nor have any other rights of ownership in, the shares of Common Stock
to be issued in satisfaction of the RSUs.

 

6. Withholding Taxes.

 

(a) As a condition precedent to the issuance to Grantee of any shares of Common
Stock pursuant to this Award, the Grantee shall, upon request by the Company,
pay to the Company such amount of cash as the Company may be required, under all
applicable federal, state, local or other laws or regulations, to withhold and
pay over as income or other withholding taxes (the “Required Tax Payments”) with
respect to the Award and any Dividend Equivalents. If Grantee shall fail to
advance the Required Tax Payments after request by the Company, the Company may,
in its discretion, deduct any Required Tax Payments from any amount then or
thereafter payable by the Company to Grantee.

 

(b) Grantee may elect to satisfy his or her obligation to advance the Required
Tax Payments by any of the following means: (1) a cash payment to the Company,
(2) delivery to the Company of previously owned whole shares of Common Stock for
which Grantee has good title, free and clear of all liens and encumbrances,
having a fair market value, determined as of the date the obligation to withhold
or pay taxes first arises in connection with the Award and any Dividend
Equivalents (the “Tax Date”), equal to the Required Tax Payments, or (3)
directing the Company to withhold a number of shares of Common Stock (or cash)
otherwise issuable to Grantee pursuant to this Award and any Dividend
Equivalents having a fair market value, determined as of the Tax Date, equal to
the Required Tax Payments or any combination of (1)-(3). Any fraction of a share
of Common Stock which would be required to satisfy such an obligation shall be
disregarded and the remaining amount due shall be paid in cash by Grantee. No
certificate representing a share of Common Stock shall be

 

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delivered until the Required Tax Payments have been satisfied in full. For
purposes of this Award and any Dividend Equivalents, the fair market value of a
share of Common Stock on a specified date shall be determined by reference to
the average of the high and low transaction prices in trading of the Common
Stock on such date as reported in the New York Stock Exchange-Composite
Transactions, or, if no such trading in the Common Stock occurred on such date,
then on the next preceding date when such trading occurred.

 

7. Miscellaneous

 

(a) The Company shall pay all original issue or transfer taxes with respect to
the issuance or delivery of shares of Common Stock pursuant hereto and all other
fees and expenses necessarily incurred by the Company in connection therewith,
and will use reasonable efforts to comply with all laws and regulations which,
in the opinion of counsel for the Company, shall be applicable thereto.

 

(b) This Award shall be governed in accordance with the laws of the State of
Illinois.

 

(c) This Award shall be binding upon and inure to the benefit of any successor
or successors to the Company.

 

(d) Neither this Award nor the RSUs nor any rights hereunder or thereunder may
be transferred or assigned by Grantee other than:

 

(1) by will or the laws of descent and distribution;

 

(2) in whole or in part to one or more transferees; provided that (i) any such
transfer must be without consideration, (ii) each transferee must be a “family
member” of Grantee, a trust established for the exclusive benefit of Grantee
and/or one or more family member of Grantee or a partnership whose sole equity
owners are Grantee and/or family members of Grantee, and (iii) such transfer is
specifically approved by the Company’s Chief Administrative Officer or the
Committee following the receipt of a completed Assignment of Restricted Stock
Unit Award attached hereto as Exhibit B; or

 

(3) as otherwise set forth in an amendment to this Agreement.

 

In the event the RSUs are transferred as contemplated in this Section 7(d), such
transfer shall become effective when approved by the Company’s Chief
Administrative Officer or the Committee (as evidenced by counter execution of
the Assignment of Restricted Stock Unit Award on behalf of the Company), and
such RSUs may not be subsequently transferred by the transferee other than by
will or the laws of descent and distribution. Any transferred RSU shall continue

 

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to be governed by and subject to the terms and conditions of the 2004 PIP and
this Agreement and the transferee shall be entitled to the same rights as
Grantee as if no transfer had taken place. Except as permitted by the foregoing,
the RSUs and this Award may not be sold, transferred, assigned, pledged,
hypothecated, encumbered or otherwise disposed of (whether by operation of law
or otherwise) or be subject to execution, attachment or similar process. Upon
any attempt to so sell, transfer, assign, pledge, hypothecate, encumber or
otherwise dispose of the RSUs, the RSUs and all rights hereunder shall
immediately become null and void. As used in this Section, “family member” with
respect to any person, includes any child, step-child, grandchild, parent,
step-parent, grandparent, spouse, former spouse, sibling, niece, nephew,
mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law and
sister-in-law, including adoptive relationships, and any person sharing the
transferor’s household (other than a tenant or employee).

 

(e) The Committee, as from time to time constituted, shall have the right to
determine any questions which arise in connection with this Agreement, the RSUs
or the Dividend Equivalents. This Agreement and the RSUs are subject to the
provisions of the 2004 PIP and shall be interpreted in accordance therewith.

 

IN WITNESS WHEREOF, the Company has caused this Award to be duly executed by its
duly authorized officer.

 

R.R. Donnelley & Sons Company

By:

       

Name:

       

Title:

   

 

Accepted:                                                      

 

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Exhibit A

 

R.R. Donnelley & Sons Company

Director Restricted Stock Unit Award

Deferral Election

 

To: Supervisor, Executive Compensation,

 

Re: RSU Award

 

I hereby elect to defer delivery of shares of Common Stock (or, in the Company’s
discretion, cash based on the fair market value of the Common Stock on the date
of distribution) with respect to the First Tranche RSUs (as defined in the
attached Award Agreement until I cease to be a member of the Board.

 

Last date on which election may be made: [Date]

 

Date of Election:

                          Signature of Grantee

 

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Exhibit B

 

R.R. DONNELLEY & SONS COMPANY

ASSIGNMENT OF RESTRICTED STOCK UNIT AWARD

 

I,                                      (the “Transferor”), hereby transfer unto
                                 (the “Transferee”), as a gift and without
receipt of any consideration, those restricted stock units (the “RSUs”) standing
in my name on the books of the Company, and set forth as follows :

 

Date of Grant

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RSUs being Transferred

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I hereby authorize the Secretary to transfer the RSUs (or portions thereof) as
set forth above on the books and records of the Company. I understand that the
proposed transfer(s) set forth above are subject to the approval of the Company
and, if approved, the proposed transfer(s) shall become effective on the date
this Assignment is signed by the Company. I also acknowledge that I will
recognize income upon delivery of shares of the Company’s common stock (the
“Common Stock”) or cash pursuant to the Restricted Stock Unit Award Agreement
and hereby agree to pay to the Company such amount as the Company is advised it
is required under applicable federal, state, local or other tax laws to withhold
and pay over to governmental taxing authorities by reason of the delivery of
shares of Common Stock or cash pursuant to the Award Agreement. I hereby
represent that the Transferee is an authorized transferee pursuant to Section
7(d)(2) of the Restricted Stock Unit Award Agreement.

 

Date signed:

     

Signature 

    

       

Print Name:

 

NOTICE: The signature on this Assignment must correspond to the name in which
the RSUs are registered on the books and records of the Company; provided,
however, that if the person transferring the RSUs is not such registered owner,
proof of such person’s right to transfer the RSUs is being delivered with this
Assignment. The Company shall have sole and final authority to determine whether
such proof is satisfactory.

 

To: R.R. Donnelley & Sons Company

 

The undersigned Transferee acknowledges and agrees that he or she has received
and reviewed a copy of the R.R. Donnelley & Sons Company 2004 Performance
Incentive Plan (the “Plan”), the agreement relating to each RSU (including any
amendment to each such agreement), the Prospectus of the Company relating to the
shares of Common Stock to be delivered pursuant to the Restricted Stock Unit
Award, the Company’s most recent Annual Report to Stockholders on Form 10-K and
the Company’s Proxy Statement relating to its most recent Annual Meeting of
Stockholders. The undersigned Transferee further acknowledges and agrees that,
except as otherwise specifically provided in an amendment to an Award Agreement,
(i) each RSU shall be governed by and remain subject to the terms and conditions
of the Plan and related Restricted Stock Unit Award Agreement, as so amended,
(ii) the Transferee shall be entitled to the same rights as the person
transferring the RSUs as if no transfer had taken place and (iii) may be amended
by the Transferor (and not the Transferee) subsequent to the date this
Assignment is signed by the Transferee. The undersigned Transferee represents
that he/she/it is an authorized transferee pursuant to Section 7(d)(2) of the
Restricted Stock Unit Award Agreement.

 

TRANSFEREE                     Signature   Date Signed       Street Address     
      

Print Name and, if applicable, representative capacity

(e.g., as trustee, as general partner)

      State   Zip Code             Taxpayer I.D. Number            

       

ACKNOWLEDGED AND AGREED:

R.R. DONNELLEY & SONS COMPANY

_________________________

         Date Signed       Name:         Title: