Ex-10.17



 





Exhibit 10.17



	 	 	 
	

	 	Amy W. Clark

AVP – Compensation

 

R. H. Donnelley

1001 Winstead Drive

Cary, NC 27513

Tel: 919.297.1209






{Date}



TO:     {Officer Name}



RE:     2005 Annual Incentive Plan


We are very pleased to announce this year’s Annual Incentive Program (AIP). Assuming and following
shareholder approval, this program will be governed under the terms of the 2005 Stock Award and
Incentive Plan (“2005 Plan"), a copy of which will be available to you electronically on the RHD
intranet under “Human Resources.” Unless otherwise defined herein, the terms defined in the 2005
Plan have the same defined meanings in this letter (this “Award Agreement”).



The terms of this year’s program are as follows:



1. Performance Criteria: Performance Awards made under the AIP are based on the
performance of the Company during the 2005 fiscal year (the “AIP Performance Period”) relative to
Sprint Publication Sales, SBC Publication Sales, EBITDA, EPS and Free Cash Flow. The performance
measures, targets, and an explanation of factors that will be included in achievement calculation
for this year’s plan are detailed on Attachment A. These financial performance measures are as
approved by the Compensation & Benefits Committee of the Board of Directors (the” Committee”) at
the beginning of the AIP Performance Period. Attachment B provides definitions and calculations of
the components that comprise the AIP performance target. All amounts as defined or calculated are
subject to adjustments determined by management and approved by the Compensation Committee.



2. Performance Award Levels: Your target award under this plan is equal to {percentage}%
of your current base salary. A portion of your award will be paid in cash and a portion in
deferred shares of R. H. Donnelley stock (deferred stock). At target, the cash component is
{percentage}% of your current base salary and the deferred stock component is {percentage}% of your
current base salary.



The payout percentage under each goal area is determined through straight-line interpolation
between each level, and above 200%. No amount will be payable with respect to a given performance
measure if the threshold performance is not achieved. The maximum award is 300% of target.



3.
Award Payment: Cash Component: You will receive the cash portion of your AIP payout
as soon as reasonably practicable after the end of the AIP Performance Period in respect of which
it has been earned and after approval by the Committee. Deferred stock: The deferred stock
component initially will be set as a dollar amount (as a percentage of base salary) and then
converted into a number of shares based upon the average of the closing stock price of the
Company’s common stock during the ten trading days following the Committee’s approval of the full
year financial results vs. targets (generally in February of the following year). Once converted
into shares, the




	 	 	 	 	 
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deferred stock will be paid out as follows: 50% on the first anniversary of the date of conversion
and 50% on the second anniversary of the date of conversion.



4. Termination of Employment: If your employment is terminated by the Company “for cause”
or if you voluntarily terminate your employment at any time before your payout under this plan, you
will forfeit your Performance Award in its entirety and will receive no payment hereunder
whatsoever.



If your employment is terminated before the end of the AIP Performance Period due to your death,
Disability (as defined below), Retirement (as defined below), assignment to a different position
for which you become no longer eligible to receive an AIP award, grant of a leave of absence or
other termination of employment (other than for Cause or as a result of your voluntary
termination), the Committee may determine, in its sole and absolute discretion, to pay to you a pro
rata portion of this Performance Award. Such pro rata Performance Award will be based on the
period of your actual participation and the Company’s actual financial performance against the
above referenced performance measures during the full AIP Performance Period. The pro rata
Performance Award (if any) will be paid to you after the end of the AIP Performance Period. In
such case, the Committee may also determine, in its sole and absolute discretion, to pay to you a
pro rata portion of either component or both components of this Performance Award. Under such
circumstances, any deferred share payout would be converted into shares as of the date of
termination and would not be subject to the vesting provisions set forth above.



The term “Disability” shall have the meaning defined for such term in the long-term disability plan
of the Company, as in effect from time to time, and the term “Retirement” shall mean your
termination after your attaining (i) age 55 years with 10 years of service with the Company or any
of its subsidiaries or affiliates or (ii) age 65 years without regard to years of such service.



5. Effect of a Change in Control: Notwithstanding the foregoing, if in connection with a
Change in Control you Retire, are assigned to a different position for which you become no longer
eligible to receive an AIP award, are placed on a leave of absence or your employment is terminated
for any other reason (other than for Cause or as a result of your voluntary termination) before the
end of the AIP Performance Period, then you shall be entitled to receive both components of your
AIP payout based on the Company’s actual financial performance against the above referenced
performance measures for the full AIP Performance Period, without pro-ration, as if you had
continued to be employed for the full AIP Performance Period. The deferred stock component would
be converted into shares as of the date of termination and would not be subject to the vesting
provisions set forth above. In the event that, in the sole and absolute discretion of the
Committee, such actual financial performance cannot be accurately measured against such performance
measures, each component of your AIP payout shall be paid out at no less than 100% of your target
Award for that component. Except as specifically provided for in this “Effect of a Change in
Control” provision, in connection with a Change in Control, this Performance Award will be subject
to Section 10 of the Plan (including without limitation Section 10(f) of the Plan).



6. Miscellaneous Terms:





	 	 	A. Encumbrance: This Performance Award will not be pledged, hypothecated or otherwise
encumbered or subject to any lien, obligation or liability of you to any party (other than
the Company or its subsidiary or affiliate), or assigned or transferred by you, other than
by will or the laws of descent and distribution or to a Beneficiary upon your death. A
Beneficiary, transferee or other person claiming any rights under the 2005 Plan from or
through you will be subject to all






	 	 	 	 	 
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	 	 	terms and conditions of the 2005 Plan and this Award Document, except as otherwise
determined by the Committee, and to any additional terms and conditions deemed necessary or
appropriate by the Committee.
	 
	 	 	B. Forfeiture: This Performance Award is subject to forfeiture under certain
circumstances in accordance with Section 11 of the 2005 Plan.
	 
	 	 	C. Decisions of the Compensation Committee: The decisions of the Committee (or, the
Board, as may be applicable) as to the computation of various AIP performance measures and
other determinations to be made with respect to this Performance Award will be final,
binding and conclusive on you, the Company and any other interested person.
	 
	 	 	D. “At Will” Employment: ANY PAYMENT UNDER THIS PERFORMANCE AWARD IS EARNED ONLY BY
CONTINUING AS AN EMPLOYEE AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED OR
BEING GRANTED THIS PERFORMANCE AWARD). THIS AWARD DOCUMENT AND THE PAYOUT SCHEDULE SET
FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF EMPLOYMENT FOR ANY PERIOD
OR AT ALL, AND WILL NOT INTERFERE IN ANY WAY WITH YOUR RIGHT TO TERMINATE OR THE COMPANY’S
RIGHT TO TERMINATE YOUR EMPLOYMENT AT ANY TIME, WITH OR WITHOUT CAUSE.
	 
	 	 	E. Taxes: The Company and any subsidiary or affiliate is authorized to withhold from any
payment relating to this Performance Award amounts of withholding and other taxes due or
potentially payable in connection with any transaction involving this Performance Award,
and to take such other action as the Committee may deem advisable to enable you and the
Company to satisfy obligations for the payment of withholding taxes and other tax
obligations relating to this Performance Award.
	 
	 	 	F. Laws: The validity, construction and effect of this Award Document will be determined
in accordance with the laws of the State of Delaware, without giving effect to principles
of conflicts of law, and applicable provisions of federal law. Any modification of this
Award Document must be in writing signed by the Company (oral statements by any person
cannot modify this Award Document).





Please let me know if you have any questions.



Sincerely,



/s/ Amy W. Clark



Amy W. Clark

AVP — Compensation




	 	 	 	 	 
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