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EXHIBIT 10.24    
    

FORM OF CHANGE IN CONTROL AGREEMENT

WITH B. MICHAEL JAMES, MARK A. ROSSI AND JOSEPH P. PETTIROSSI 

Effective            

[Name
and address of Executive] 

Dear
[executive]: 

        The
Board considers the establishment and maintenance of a sound and vital management to be essential to protecting and enhancing the best interests of the Company and its stockholders.
In this connection, the Board recognizes that the possibility of a Change in Control may raise uncertainty and questions among management which may result in the departure or distraction of management
personnel to the detriment of the Company and its stockholders. 

        Accordingly,
the Board has determined that appropriate steps should be taken to minimize the risk that Company executive management will depart prior to a Change in Control, thereby
leaving the Company without adequate executive management personnel during such a critical period, and to reinforce and encourage the continued attention and dedication of members of the Company's
executive management to their assigned duties without distraction in circumstances arising from the possibility of a Change in Control. 

        The
Board recognizes that continuance of your position with the Company involves a substantial commitment to the Company in terms of your personal life and professional career and the
possibility of foregoing present and future career opportunities, for which the Company receives substantial benefits. Therefore, to induce you to remain in the employ of the Company, this Agreement,
which has
been approved by the Board, sets forth the benefits that the Company agrees will be provided to you in the event your employment with the Company is terminated in connection with a Change in Control
under the circumstances described below. 

        1.    DEFINITIONS.    The following terms have the meaning set forth below unless the context clearly requires
otherwise. Terms defined elsewhere in this Agreement have the same meaning throughout this Agreement. 

        (a)   "Affiliate" means (i) any corporation at least a majority of whose outstanding securities ordinarily having the
right to vote at elections of directors is owned directly or indirectly by the Parent Corporation or (ii) any other form of business entity in which the Parent Corporation, by virtue of a
direct or indirect ownership interest, has the right to elect a majority of the members of such entity's governing body. 

        (b)   "Agreement" means this letter agreement as amended, extended or renewed from time to time in accordance with its terms. 

        (c)   "Base Pay" means your annual base salary from the Company at the rate in effect immediately prior to a Change in Control
or at the time Notice of Termination is given, whichever is greater. Base Pay includes only regular cash salary and is determined before any reduction for deferrals pursuant to any nonqualified
deferred compensation plan or arrangement, qualified cash or deferred arrangement or cafeteria plan. 

        (d)   "Benefit Plan" means any 

          (i)  employee
benefit plan as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended; 

         (ii)  cafeteria
plan described in Code Section 125; 

 

        (iii)  plan,
policy or practice providing for paid vacation, other paid time off or short-or long-term profit sharing, bonus or incentive payments; or 

        (iv)  stock
option, stock purchase, restricted stock, phantom stock, stock appreciation right or other equity-based compensation plan with respect to the securities of any
Affiliate 

made
available to employees of the Company generally or any group of employees or you in particular. 

        (e)   "Board" means the board of directors of the Parent Corporation duly qualified and acting at the time in question. On and
after the date of a Change in Control, any duty of the Board in connection with this Agreement is nondelegable and any attempt by the Board to delegate any such duty is ineffective. 

        (f)    "Cause" means: 

          (i)  your
gross misconduct; 

         (ii)  your
willful and continued failure to perform substantially your duties with the Company (other than any such failure (1) resulting from your incapacity due to
bodily injury or physical or mental illness or (2) relating to changes in your duties after a Change in Control which constitute Good Reason) after a demand for substantial performance is
delivered to you by the chair of the Board which specifically identifies the manner in which you have not substantially performed your duties and provides for a reasonable period of time within which
you may take corrective actions; or 

        (iii)  your
conviction (including a plea of nolo contendere) of willfully engaging in illegal conduct constituting a felony or gross misdemeanor under federal or state law
which is materially and demonstrably injurious to the Company or which impairs your ability to perform substantially your duties for the Company. 

        An
act or failure to act will be considered "gross or willful" for this purpose only if done, or omitted to be done, by you in bad faith and without reasonable belief that it was in, or
not opposed to, the best interests of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board (or a committee thereof) or based upon the
advice of counsel for the Company will be conclusively presumed to be done, or omitted to be done, by you in good faith and in the best interests of the Company. It is also expressly understood that
your attention to matters not directly related to the business of the Company will not provide a basis for termination for Cause so long as the Board did not expressly disapprove in writing of your
engagement in such activities
either before or within a reasonable period of time after the Board knew or could reasonably have known that you engaged in those activities. Notwithstanding the foregoing, you may not be terminated
for Cause unless and until there has been delivered to you a copy of a resolution duly adopted by the affirmative vote of not less than a majority of the entire membership of the Board at a meeting of
the Board called and held for the purpose (after reasonable notice to you and an opportunity for you, together with your counsel, to be heard before the Board), finding that in the good faith opinion
of the Board you were guilty of the conduct set forth above in clauses (i), (ii) or (iii) of this definition and specifying the particulars thereof in detail. 

        (g)   "Change
in Control" means any of the following: 

          (i)  the
sale, lease, exchange or other transfer, directly or indirectly, of substantially all of the assets of the Parent Corporation, in one transaction or in a series of
related transactions, to any Person; 

         (ii)  any
Person, other than a "bona fide underwriter," becomes, after the date of this Agreement, the "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act), 

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directly
or indirectly, of 20 percent or more of the combined voting power of the Parent Corporation's outstanding securities ordinarily having the right to vote at elections of directors; 

        (iii)  a
merger or consolidation to which the Parent Corporation is a party if the stockholders of the Parent Corporation immediately prior to the effective date of such
merger or consolidation have, solely on account of ownership of securities of the Parent Corporation at such time, "beneficial ownership" (as defined in Rule 13d-3 under the
Exchange Act) immediately following the effective date of such merger or consolidation of securities of the surviving corporation representing less than 80 percent of the combined voting power
of the surviving corporation's then outstanding securities ordinarily having the right to vote at elections of directors; 

        (iv)  the
continuity directors cease for any reason to constitute at least a majority of the Board; or 

         (v)  a
change in control of a nature that is determined by outside legal counsel to the Parent Corporation, in a written opinion specifically referencing this provision of
the Agreement, to be required to be reported (assuming such event has not been "previously reported") pursuant to Section 13 or 15(d) of the Exchange Act, whether or not the Parent Corporation
is then subject to such reporting requirement. 

        For
purposes of this Section 1(g), a "continuity director" means any individual who is a member of the Board
on                        , while he or she is a member of the Board, and any
individual who subsequently becomes a member of the Board whose election or nomination for election by the Parent Corporation's stockholders was approved by a vote of at least a majority of the
directors who are continuity directors (either by a specific vote or by approval of the proxy statement of the Parent Corporation in which such individual is named as a nominee for director without
objection to such nomination). For example, if a majority of the 10 individuals constituting the Board
on                        approved a proxy statement in which six different individuals were nominated
to replace six of the individuals who were members of the Board on                        , upon their election by the Parent
Corporation's stockholders, the six newly elected directors would join the four
directors who were members of the Board on                        as continuity directors. Similarly, if a majority of those 10
directors approved a proxy statement in which four different individuals were
nominated to replace the four remaining directors who were members of the Board on                        , upon their election by
the Parent Corporation's stockholders, the four newly elected directors would
also become, along with the other six directors, continuity directors. Individuals subsequently joining the Board could become continuity directors under the principles reflected in this example. 

        For
purposes of this Section 1(g), a "bona fide underwriter" means a Person engaged in business as an underwriter of securities that acquires securities of the Parent Corporation
through such Person's participation in good faith in a firm commitment underwriting until the expiration of 40 days after the date of such acquisition. 

        2.     "Code" means the Internal Revenue Code of 1986, as amended. Any reference to a specific provision of the Code includes a
reference to such provision as it may be amended from time to time and to any successor provision. 

        (a)   "Company" means the Parent Corporation, any Successor and any Affiliate. 

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        (b)   "Date of Termination" following a Change in Control (or prior to a Change in Control if your termination was either a
condition of the Change in Control or was at the request or insistence of any Person related to the Change in Control) means: 

          (i)  if
your employment is to be terminated by you for Good Reason, the date specified in the Notice of Termination which in no event may be a date more than 15 days
after the date on which Notice of Termination is given unless the Company agrees in writing to a later date; 

         (ii)  if
your employment is to be terminated by the Company for Cause, the date specified in the Notice of Termination; 

        (iii)  if
your employment is terminated by reason of your death, the date of your death; or 

        (iv)  if
your employment is to be terminated by the Company for any reason other than Cause or your death, the date specified in the Notice of Termination, which in no event
may be a date earlier than 15 days after the date on which a Notice of Termination is given, unless you expressly agree in writing to an earlier date. 

        In
the case of termination by the Company of your employment for Cause, if you have not previously expressly agreed in writing to the termination, then within the 30-day
period after your receipt of the Notice of Termination, you may notify the Company that a dispute exists concerning the termination, in which event the Date of Termination will be the date set either
by mutual written agreement of the parties or by the judge or arbitrators in a proceeding as provided in Section 11 of this Agreement. During the pendency of any such dispute, you will continue
to make yourself available to provide services to the Company and the Company will continue to pay you your full compensation and benefits in effect immediately prior to the date on which the Notice
of Termination is given (without regard to any changes to such compensation or benefits that constitute Good Reason) and until the dispute is resolved in accordance with Section 11 of this
Agreement. You will be entitled to retain the full amount of any such compensation and benefits without regard to the resolution of the dispute unless the judge or arbitrators decide(s) that your
claim of a dispute was frivolous or advanced by you in bad faith. 

        (c)   "Exchange Act" means the Securities Exchange Act of 1934, as amended. Any reference to a specific provision of the
Exchange Act or to any rule or regulation thereunder includes a reference to such provision as it may be amended from time to time and to any successor 

        (d)   "Good Reason" means: 

          (i)  a
change in your title(s), status, position(s), authority, duties or responsibilities as an executive of the Company as in effect immediately prior to the Change in
Control which, in your reasonable judgment, is material and adverse (other than, if applicable, any such change directly attributable to the fact that the Parent Corporation is no longer publicly
owned); provided, however, that Good Reason does not include such a change that is remedied by the Company promptly after receipt of notice of such change is given by you; 

         (ii)  a
reduction by the Company in your Base Pay, or an adverse change in the form or timing of the payment thereto, as in effect immediately prior to the Change in Control
or as thereafter increased; 

        (iii)  the
failure by the Company to cover you under Benefit Plans that, in the aggregate, provide substantially similar benefits to you and/or your family and dependents at
a substantially similar total cost to you (e.g., premiums, deductibles, co-pays, out of pocket maximums, required contributions and the like) relative to the benefits and total costs under
the Benefit Plans in which you (and/or your family or dependents) were participating at any time during the 90-day period immediately preceding the Change in Control; 

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        (iv)  the
Company's requiring you to be based more than 30 miles from where your office is located immediately prior to the Change in Control, except for required travel on
the Company's business, and then only to the extent substantially consistent with the business travel obligations which you undertook on behalf of the Company during the 90-day period
immediately preceding the Change in Control (without regard to travel related to or in anticipation of the Change in Control); 

         (v)  the
failure by the Company to obtain from any Successor the assent to this Agreement contemplated by Section 5 of this Agreement; 

        (vi)  any
purported termination by the Company of your employment that is not properly effected pursuant to a Notice of Termination and pursuant to any other requirements of
this Agreement, and, for purposes of this Agreement, no such purported termination will be effective; or 

       (vii)  any
refusal by the Company to continue to allow you to attend to matters or engage in activities not directly related to the business of the Company which, at any time
prior to the Change in Control, you were not expressly prohibited in writing by the Board from attending to or engaging in. 

        Your
continued employment does not constitute consent to, or waiver of any rights arising in connection with, any circumstances constituting Good Reason. Your termination of employment
for Good Reason as defined in this Section 1(1) will constitute Good Reason for all purposes of this Agreement notwithstanding that you may also thereby be deemed to have retired under any
applicable benefit plan, policy or practice of the Company. 

        (e)   "Notice of Termination" means a written notice given on or after the date of a Change in Control (unless your termination
before the date of the Change in Control was either a condition of the Change in Control or was at the request or insistence of any Person related to the Change in Control) which indicates the
specific termination provision in this Agreement pursuant to which the notice is given. Any purported termination by the Company or by you for Good Reason on or after the date of a Change in Control
(or before the date of a Change in Control if your termination was either a condition of the Change in Control or was at the request or insistence of any Person related to the
Change in Control) must be communicated by written Notice of Termination to be effective; provided, that your failure to provide Notice of Termination will not limit any of your rights under this
Agreement except to the extent the Company demonstrates that it suffered material actual damages by reason of such failure. 

        (f)    "Parent Corporation" means Merrill Corporation and any Successor. 

        (g)   "Person" means any individual, corporation partnership, group, association or other "person," as such term is used in
Section 13(d) or Section 14(d) of the Exchange Act, other than the Parent Corporation, any Affiliate or any benefit plan(s) sponsored by the Parent Corporation or an Affiliate. 

        (h)   "Successor" means any Person that succeeds to, or has the practical ability to control (either immediately or solely with
the passage of time), the Parent Corporation's business directly, by merger, consolidation or other form of business combination, or indirectly, by purchase of the Parent Corporation's outstanding
securities ordinarily having the right to vote at the election of directors or all or substantially all of its assets or otherwise. 

        3.    TERM OF AGREEMENT.    This Agreement is effective immediately and will continue in effect until
January 1,        ; provided, however, that commencing on January 1,        and each January 1 thereafter, the term of this Agreement will automatically be
extended
for 12 additional months beyond the expiration date otherwise then in effect, unless at least 90 calendar days prior to 

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any
such January 1, the Company or you has given notice that this Agreement will not be extended; and, provided, further, that if a Change in Control has occurred during the term of this
Agreement, this Agreement will continue in effect beyond the termination date then in effect for a period of 24 months following the month during which the Change in Control occurs or, if
later, until the date on which the Company's obligations to you arising under or in connection with this Agreement have been satisfied in full. 

        4.    BENEFITS UPON A CHANGE IN CONTROL TERMINATION.    You will become entitled to the benefits described in this
Section 3 if and only if (i) the Company terminates your employment for any reason other than your death or Cause, or you terminate your employment with the Company for Good Reason and
(ii) the termination occurs either within the period beginning on the date of a Change in Control and ending on the last day of the twenty-fourth month that begins after the month during which
the Change in Control occurs or prior to a Change in Control if your termination was either a condition of the Change in Control or was at the request or insistence of a Person related to the Change
in Control. 

        (a)    Cash Payment.    Not more than five business days following the Date of Termination, or, if later, not more
than five business days following the date of the Change in Control, the Company will make a lump-sum cash payment to you in an amount equal to two times the sum of (i) your Base
Pay plus (ii) your target cash bonus for the year during which the Change in Control occurs or the average of your cash bonus for the three fiscal years ending immediately prior to the Change
in Control, whichever is greater. This payment is in lieu of any other cash bonus payment to which you may otherwise be entitled under any bonus plan for any period ending after your Date of
Termination. Cash bonus payments relating to any period ending on or before your Date of Termination will be paid to you in accordance with the terms of the bonus plan. 

        (b)    Health Benefits.    During the period beginning on your Date of Termination and ending on the last day of the
twenty-fourth month that begins after your Date of Termination, the Company will provide, or arrange to provide, medical, dental and vision benefits (excluding premium conversion or flexible spending
accounts under any cafeteria plan) to you (and your family members and dependents who were eligible to be covered at any time during the 90-day period immediately prior to the date of a
Change in Control for the period after the Change in Control in which such family members and dependents would otherwise continue to be covered under the terms of the applicable Benefit Plan in effect
immediately prior to the Change in Control) under the same terms and at the same cost to you and your family members and dependents as similarly situated individuals who continue to be employed by the
Company (without regard to any reduction in such benefits that constitutes Good Reason). To the extent you incur a tax liability (including federal, state and local taxes and any interest and
penalties with respect thereto) in connection with a benefit provided pursuant to this Section 3(b) which you would not have incurred had you been an active employee of the Company
participating in the Company's group health plan, the Company will make a payment to you in an amount equal to such tax liability plus an additional amount sufficient to permit you to retain a net
amount after all taxes (including penalties and interest) equal to the initial tax liability in connection with the benefit. For purposes of applying the foregoing, your tax rate will be deemed to be
the highest statutory marginal state and federal tax rate (on a combined basis) then in effect. The payment pursuant to this Section 3(b) will be made within 10 days after your remittal
of a written request for payment accompanied by a statement indicating the basis for and amount of the liability. 

        (c)    Supplemental Executive Retirement Plan.    The Company will cause your account balance under the Merrill
Corporation Supplemental Executive Retirement Plan to become fully vested and nonforfeitable effective as of the Date of Termination and at all times thereafter. In addition, the Company will cause
any distribution to which you are entitled under the Merrill Corporation Supplemental Executive Retirement Plan to be made without regard to any provision of the Plan 

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that
permits your distribution to be deferred to the extent necessary to ensure that no part of the distribution is nondeductible pursuant to Code Section 162(m). 

        (d)    Gross-Up Payments.    Following a Change in Control, the Company will cause its independent
auditors promptly to review, at the Company's sole expense, the applicability of Code Section 4999 to any payment or distribution of any type by the Company to or for your benefit, whether paid
or payable or distributed or distributable pursuant to the terms of this Agreement, any Benefit
Plan or otherwise (the "Total Payments"). If the auditor determines that the Total Payments result in an excise tax imposed by Code Section 4999 or any comparable state or local law or any
interest or penalties with respect to such excise tax (such excise tax, together with any such interest and penalties, are collectively referred to as the "Excise Tax"), the Company will make an
additional cash payment (a "Gross-Up Payment") to you within 10 days after such determination equal to an amount such that after payment by you of all taxes (including any interest
or penalties imposed with respect to such taxes), including any Excise Tax, imposed upon the Gross-Up Payment, you would retain an amount of the Gross-Up Payment equal to the
Excise Tax imposed upon the Total Payments. For purposes of the foregoing determination, your tax rate will be deemed to be the highest statutory marginal state and federal tax rate (on a combined
basis) then in effect. If no determination by the Company's auditors is made prior to the time you are required to file a tax return reflecting the Total Payments, you will be entitled to
receive from the Company a Gross-Up Payment calculated on the basis of the Excise Tax you reported in such tax return, within 10 days after the later of the date on which you file
such tax return or the date on which you provide a copy thereof to the Company. In all events, if any tax authority determines that a greater Excise Tax should be imposed upon the Total Payments than
is determined by the Company's independent auditors or reflected in your tax return pursuant to this Section 3(d), you will be entitled to receive from the Company the full Gross-Up
Payment calculated on the basis of the amount of Excise Tax determined to be payable by such tax authority within 10 days after you notify the Company of such determination. If any other
Benefit Plan or other plan, policy or practice of the Company or any other agreement between you and the Company (an "Other Arrangement") specifically provides that benefits thereunder will be reduced
or limited so that such benefits or the Total Payments will not result in the imposition of an excise tax pursuant to Code Section 4999, the reduction or limitation will apply, to the extent
provided in the Other Arrangement, solely to the benefits provided pursuant to the Other Arrangement as if the benefits under the Other Arrangement constituted the entire Total Payments, and such
reduction or limitation will not otherwise reduce or limit the actual Total Payments. 

        If,
on or after the date of a Change in Control, an Affiliate is sold, merged, transferred or in any other manner or for any other reason ceases to be an Affiliate or all or any portion
of the business or assets of an Affiliate are sold, transferred or otherwise disposed of and the acquiror is not the Parent Corporation or an Affiliate (a "Disposition"), and you remain or become
employed by the acquiror or an affiliate of the acquiror (as defined in this Agreement but substituting "acquiror" for "Parent Corporation") in connection with the Disposition. you will be deemed to
have terminated employment on the effective date of the Disposition for purposes of this Section 3 unless (x) the acquiror and its affiliates jointly and severally expressly assume and
agree, in a manner that is enforceable by you, to perform the obligations of this Agreement to the same extent that the Company would be required to perform if the Disposition had not occurred and
(y) the Successor guarantees, in a manner that is enforceable by you, payment and performance by the acquiror. 

        5.    INDEMNIFICATION.    Following a Change in Control, the Company will indemnify and advance expenses to you for
damages, costs and expenses (including, without limitation, judgments, fines, penalties, settlements and reasonable fees and expenses of your counsel) incurred in connection with all matters, events
and transactions relating to your service to or status with the Company or any other corporation, employee benefit plan or other entity with whom you served at the request of the 

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Company
to the extent that the Company would have been required to do so under applicable law, corporate articles, bylaws or agreements or instruments of any nature with or covering you, as in effect
immediately prior to the Change in Control and to any further extent as may be determined or agreed upon following the Change in Control. 

        6.    SUCCESSORS.    The Parent Corporation will seek to have any Successor, by agreement in form and substance
satisfactory to you, assent to the fulfillment by the Company of the Company's obligations under this Agreement. Failure of the Parent Corporation to obtain such assent at least three business days
prior to the time a Person becomes a Successor (or where the Parent Corporation does not have at least three business days' advance notice that a Person may become a Successor, within one business day
after having notice that such Person may become or has become a Successor) will constitute Good Reason for termination by you of your employment. The date on which any such succession becomes
effective will be deemed the Date of Termination, and Notice of Termination will be deemed to have been given on that date. A Successor has no rights, authority or power with respect to this Agreement
prior to a Change in Control. 

        7.    BINDING AGREEMENT.    This Agreement inures to the benefit of, and is enforceable by, you, your personal and
legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If you die while any amount would still be payable to you under this Agreement if you had
continued to live, all such amounts, unless otherwise provided in this Agreement, will be paid in accordance with the terms of this Agreement to your devisee, legatee or other designee or, if there be
no such designee, to your estate. 

        8.    NO MITIGATION.    You will not be required to mitigate the amount of any benefits the Company becomes obligated
to provide to you in connection with this Agreement by seeking other employment or otherwise. The benefits to be provided to you in connection with this Agreement may not be reduced, offset or subject
to recovery by the Company by any benefits you may receive from other employment or otherwise. 

        9.    NO SETOFF.    The Company has no right to setoff benefits owed to you under this Agreement against amounts owed
or claimed to be owed by you to the Company under this Agreement or otherwise. 

        10.    TAXES.    All benefits to be provided to you in connection with this Agreement will be subject to required
withholding of federal, state and local income, excise and employment-related taxes. The
Company's good faith determination with respect to its obligation to withhold such taxes relieves it of any obligation that such amounts should have been paid to you. 

        11.    NOTICES.    For the purposes of this Agreement, notices and all other communications provided for in, or
required under, this Agreement must be in writing and will be deemed to have been duly given when personally delivered or when mailed by United States registered or certified mail, return receipt
requested, postage prepaid and addressed to each party's respective address set forth on the first page of this Agreement (provided that all notices to the Company must be directed to the attention of
the chair of the Board), or to such other address as either party may have furnished to the other in writing in accordance with these provisions, except that notice of change of address will be
effective only upon receipt. 

        12.    DISPUTES.    If you so elect, any dispute, controversy or claim arising under or in connection with this
Agreement will be settled exclusively by binding arbitration administered by the American Arbitration Association in Minneapolis, Minnesota in accordance with the Commercial Arbitration Rules of the
American Arbitration Association then in effect; provided that you may seek specific performance of your right to receive benefits until the Date of Termination during the pendency of any dispute or
controversy arising under or in connection with this Agreement. Judgment may be entered on the arbitrator's award in any court having jurisdiction. If any dispute, controversy or claim for 

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damages
arising under or in connection with this Agreement is settled by arbitration, the Company will pay, or if elected by you, reimburse, all fees, costs and expenses incurred by you related to
such arbitration unless the arbitrators decide that your claim was frivolous or advanced by you in bad faith. If you do not elect arbitration, you may pursue all available legal remedies. The Company
will pay, or if elected by you, reimburse you for, all fees, costs and expenses incurred by you in connection with any actual, threatened or contemplated litigation relating to this Agreement to which
you are or reasonably expect to become a party, whether or not initiated by you, if you are successful in recovering any benefit under this Agreement as a result of such action. The parties agree that
any litigation arising under or in connection with this Agreement must be brought in a court of competent jurisdiction in the State of Minnesota, and hereby consent to the exclusive jurisdiction of
said courts for this purpose and agree not to assert that such courts are an inconvenient forum. The Company will not assert in any dispute or controversy with you arising under or in connection with
this Agreement your failure to exhaust administrative remedies. 

        13.    RELATED AGREEMENTS.    To the extent that any provision of any Benefit Plan or other benefit plan, policy,
practice or agreement between the Company or any Affiliate and you (an "Other Arrangement") limits, qualifies or is inconsistent with any provision of this Agreement, then for purposes of this
Agreement, while such Other Arrangement remains in force, the provision of this Agreement will control and such provision of such Other Arrangement will be deemed to have been superseded, and to be of
no force or effect, as if such Other Arrangement had been formally amended to the extent necessary to accomplish such purpose. Nothing in this Agreement prevents or limits your continuing or future
participation in any Other Arrangement for which you may qualify, and nothing in this Agreement limits or otherwise affects the rights you may have under any Other Arrangement. Amounts that are vested
benefits or which you are otherwise entitled to receive under any Other
Arrangement at or subsequent to the Date of Termination will be payable in accordance with such Other Arrangement. 

        14.    NO EMPLOYMENT OR SERVICE CONTRACT.    Nothing in this Agreement is intended to provide you with any right to
continue in the employ of the Company for any period of specific duration or interfere with or otherwise restrict in any way your rights or the rights of the Company, which rights are hereby expressly
reserved to each, to terminate your employment at any time for any reason or no reason whatsoever, with or without cause. 

        15.    PAYMENT; ASSIGNMENT.    Benefits payable under this Agreement will be paid only from the general assets of the
Company. No person has any right to or interest in any specific assets of the Company by reason of this Agreement. To the extent benefits under this Agreement are not paid when due to any individual,
he or she is a general unsecured creditor of the Company with respect to any amounts due. Benefits payable pursuant to this Agreement and the right to receive future benefits may not be anticipated,
alienated, sold, transferred, assigned, pledged, encumbered or subject to any charge. 

        16.    SURVIVAL.    The respective obligations of, and benefits afforded to, the Company and you which by their
express terms or clear intent survive termination of your employment with the Company or termination of this Agreement, as the case may be, will survive termination of your employment with the Company
or termination of this Agreement, as the case may be, and will remain in full force and effect according to their terms. 

        17.    MISCELLANEOUS.    No provision of this Agreement may be modified, waived or discharged unless such
modification, waiver or discharge is agreed to in a writing signed by you and a duly authorized officer of the Parent Corporation. No waiver by any party to this Agreement at any time of any breach by
another party to this Agreement of, or of compliance with any condition or provision of this Agreement to be performed by such party will be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter to this 

9

 

Agreement
have been made by any party which are not expressly set forth in this Agreement. This Agreement and the legal relations among the parties as to all matters, including, without limitation,
matters of validity, interpretation, construction, performance and remedies, will be governed by and construed exclusively in accordance with the internal laws of the State of Minnesota (without
regard to the conflict of laws principles of any jurisdiction). Headings are for purposes of convenience only and do not constitute a part of this Agreement. The parties to this Agreement agree to
perform, or cause to be performed, such further acts and deeds and to execute and deliver or cause to be executed and delivered, such additional or supplemental documents or instruments as may be
reasonably required by the other party to carry into effect the intent and purpose of this Agreement. The invalidity or unenforceability of all or any part of any provision of this Agreement will not
affect the validity or enforceability of the remainder of such provision or of any other provision of this Agreement, which will remain in full force and effect. This Agreement may be executed in
several counterparts, each of which will be deemed to be an original, but all of which together will constitute one and the same instrument. 

        If
this letter correctly sets forth our agreement on the subject matter discussed above, kindly sign and return to the Company the enclosed copy of this letter which will then constitute
our agreement on this subject. 

MERRILL
CORPORATION 

	By:	 	 
	 	
	 
	

 	

 	

 
	
	 
	[Executive]	 

10

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Exhibit 10.27    
    

 
 

PREFERRED STOCKHOLDERS AGREEMENT    
    

        PREFERRED STOCKHOLDERS AGREEMENT dated as of August 9, 2002, by and among Merrill Corporation, a Minnesota corporation (the "Company"), and all of the
Company's existing holders of outstanding preferred stock, as such holders are set forth on the signature page of this Agreement (each a "Preferred Stockholder", and collectively, the "Preferred
Stockholders"). 

        WHEREAS,
in connection with the restructuring of certain of the Company's debt and equity securities (the "Restructuring") as described in the Company's Offering Circular and Consent
Solicitation Statement dated July 3, 2002 (the "Offering Circular") for the exchange offer for the Company's outstanding 12% Senior Subordinated Notes due 2009 (the "Exchange Offer"), a copy of
which has been provided to each Preferred Stockholder, the parties to this Agreement have agreed, subject to the terms of this Agreement, to amend the Company's existing certificate of designation
(the "Certificate of Designation") relating to its 14.5% Senior Preferred Stock due 2011 (the "Old Preferred Stock") to, among other things, rename the Old Preferred Stock as the Preferred Stock due
2011 (the "New Preferred Stock"); and 

        WHEREAS,
the Preferred Stockholders collectively hold all of the outstanding shares of Preferred Stock and have, subject to the terms of this Agreement, previously agreed to consent to
the amendment to the Certificate of Designation; and 

        WHEREAS,
in connection with the Restructuring, the parties to this Agreement have agreed, subject to the terms of this Agreement, that the Preferred Stockholders shall have the right to
receive in certain circumstances the Company's Series C Warrants (the "Series C Warrants") and Series D Warrants (the "Series D Warrants"), each to purchase shares of the
Company's Class B Common Stock, par value $0.01 per share (the "Class B Common Stock"); and 

        WHEREAS,
the Board of Directors of the Company has approved the terms of the Restructuring; 

        NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows: 

1.     DEFINITIONS  

        Capitalized terms used herein shall have the meanings assigned to them in the Certificate of Designation unless otherwise indicated. 

        "Agreement"
means this Preferred Stockholders Agreement, as it may be amended, restated, modified or supplemented from time to time in accordance with its terms. 

        "Board
of Directors" means the board of directors of the Company. 

        "Closing
Date" means the date on which the Restructuring is consummated. 

 

        "Current
Value" means (i) if the Class B Common Stock is registered under the Exchange Act and has traded on the Nasdaq National Market or a national securities exchange
for not less than 30 consecutive trading days, the average of the daily closing sale price for that security, for the 30 consecutive trading days immediately preceding that date, or (ii) if the
Class B Common Stock is not registered under the Exchange Act, (x) the price paid for the Class B Common Stock in an arm's-length transaction where DLJMB sells 5.0% or more of the
Class B Common Stock beneficially owned by it to an unaffiliated third party, and (y) the fair market value of such shares of Class B Common Stock as determined in good faith by
the Board of Directors (without regard to considerations of the lack of liquidity, applicable regulatory restrictions or any of the transfer restrictions or other obligations imposed on such shares
set forth in the Company's Investors Agreement) if (A) substantially all of the Company's assets (in one transaction or a series of related transactions) are sold, leased or exchanged
(directly or indirectly) or (B) as a result of a merger, consolidation or otherwise, the Company's shareholders immediately prior to such transaction no longer have beneficial ownership (as
defined in Rule 13d-3 of the Exchange Act) of more than 80% of the combined voting power of the
surviving corporation's outstanding securities ordinarily having the right to vote at elections of directions. If the holders of a majority of the shares of New Preferred Stock shall object to any
determination by the Board of Directors of the Current Value, the Current Value shall be the fair market value per share of Class B Common Stock as determined by an independent appraiser
retained by the Company at its expense and reasonably acceptable to the holders of the majority of the share of New Preferred Stock. 

        "DLJMB"
means DLJ Merchant Banking Partners II, L.P. or affiliated investors. 

        "Exchange
Act" means the Securities Exchange Act of 1934, as amended. 

        "Series C
Triggering Event" means the earlier of (i) the first date on which the Current Value of the Class B Common Stock is greater than $15.00 (the
"Series C Trigger Price"), on a fully diluted basis, pro forma for the exercise of all Series C Warrants and Series D Warrants (to the extent that such Series D Warrants
were not issued or exercised on such date); provided that to the extent that the Series C Warrant Amount is increased pursuant to the proviso of
Section 4(a)(ii), the Series C Trigger Price shall be decreased proportionately; provided further, that no Series C Triggering
Event shall be deemed to have occurred unless one of the events in clauses (i) or (ii) of the definition of "Current Value" shall have taken place, and (ii) the date on which the
Company fails to exercise its Mandatory Redemption Obligation (as such term is defined in the Amended and Restated Certificate of Designation of the New Preferred Stock). 

        "Series D
Triggering Event" means the earlier of (i) the first date on which the Current Value of the Class B Common Stock is greater than $22.00 (the
"Series D Trigger Price"), on a fully diluted basis, pro forma for the exercise of all Series D Warrants and Series C Warrants (to the extent that such Series C Warrants
were not issued or exercised on such date); provided that to the extent that the Series D Warrant Amount is increased pursuant to the proviso of
Section 4(b)(ii), the Series D Trigger Price shall be decreased proportionately; provided further, that no Series D Triggering
Event shall be deemed to have occurred unless one of the events in clauses (i) or (ii) of the definition of "Current Value" shall have taken place, and (ii) the date on which the
Company fails to exercise its Mandatory Redemption Obligation (as such 

2

 

term
is defined in the Amended and Restated Certificate of Designation of the New Preferred Stock). . 

2.     CONDITIONS  

        This Agreement and any approvals, consents, waivers, agreements and obligations hereunder shall only become operative and have full force and effect upon the
prior or concurrent consummation of each element of the Restructuring. 

3.     AMENDMENT OF CERTIFICATE OF DESIGNATION  

        (a)   Each
of the Preferred Stockholders hereby approves, consents and agrees that the powers, preferences and relative, participating, optional or other special rights and
the qualifications, limitations and restrictions of the Old Preferred Stock as set forth in the Certificate of Designation are amended and restated in their entirety as set forth in the Amended and
Restated Certificate of Designation, in substantially the form attached hereto as Exhibit A. 

        (b)   Each
of the Preferred Stockholders hereby approves, consents and agrees that Steven J. Machov, the Secretary of the Company, or his designee, is authorized and directed
to execute and file the Amended and Restated Certificate of Designation with the Office of the Secretary of State of the State of Minnesota and that the appropriate officers of the Company, or any one
or more of them, are authorized and directed to execute such instruments on behalf of the Company and to take such other actions as they deem necessary or advisable to give effect to the Amended and
Restated Certificate of Designation. 

4.     ISSUANCE OF WARRANTS  

        (a)    Series C Warrants.    Within three business days of the Series C Triggering Event, the Company
shall send to each Preferred Stockholder, by mail, to the address shown for such Preferred Stockholder in the registry for the New Preferred Stock, Series C Warrants, in substantially the form
attached hereto as Exhibit B, the number of which will be equal to the product of (i) a fraction, the numerator of which is the number of shares of New Preferred Stock held of record by
such Preferred Stockholder on the Series C Triggering Event and the denominator of which is 500,000 and (ii) 189,101 (the "Series C Warrant Amount"); provided however, to the
extent that any event occurs after the date of this Agreement but before the date of issuance of the Series C Warrant which would, if such event were to occur after the date of issuance of the
Series C Warrants, increase the number of shares of Class B Common Stock for which the Series C Warrants are exercisable, the Series C Warrant Amount shall be
proportionately so increased. 

        (b)    Series D Warrants.    Within three business days of the Series D Triggering Event, the Company
shall send to each Preferred Stockholder, by mail, to the address shown for such Preferred Stockholder in the registry for the New Preferred Stock, Series D Warrants, in substantially the form
attached hereto as Exhibit C, the number of which will be equal to the product of (i) a fraction, the numerator of which is the number of shares of New Preferred Stock held of record by
such Preferred Stockholder on the Series D Triggering Event and the denominator of which is 500,000 and (ii) 189,101 (the "Series D Warrant Amount"); provided however, to the
extent that any event occurs after the date of this Agreement but before the date 

3

 

of
issuance of the Series D Warrant which would, if such event were to occur after the date of issuance of the Series D Warrants, increase the number of shares of Class B Common
Stock for which the Series D Warrants are exercisable, the Series D Warrant Amount shall be proportionately so increased. 

5.     SUCCESSORS  

        All of the provisions of this Agreement by or for the benefit of the Company or the Preferred Stockholders shall bind and inure to the benefit of their respective
successors, transferees and assigns hereunder. 

6.     TERMINATION  

        This Agreement shall terminate and be of no further force or effect upon the earlier of the issuance of the Series D Warrants hereunder or the tenth
anniversary of the Closing Date. 

7.     ENTIRE AGREEMENT  

        All prior agreements of the parties concerning the subject matter of this Agreement are expressly superceded by this Agreement. This Agreement contains the entire
agreement of the parties concerning the subject matter hereof. Any oral representations or modifications of this Agreement shall be of no effect. 

8.     GOVERNING LAW  

        This Agreement shall be governed by and construed in accordance with the laws of the State of New York. 

9.     COUNTERPARTS  

        This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which, together shall constitute one and the
same instrument. 

10.   AMENDMENTS  

        No amendment or waiver of this Agreement nor consent to any departure therefrom shall in any event be effective unless the same shall be in writing and signed by
the parties hereto and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. 

[SIGNATURE
PAGE FOLLOWS] 

4

IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. 

	

 	
 	

MERRILL CORPORATION
	

 	
 	

By:	
 	

/s/ Steven J. Machov
 Name: Steven J. Machov

Title: Vice President, General Counsel and

Secretary
	

 	
 	

DLJ INVESTMENT PARTNERS, L.P.,
	

 	
 	

By:	
 	

DLJ INVESTMENT PARTNERS, INC., as

managing general partner
	

 	
 	

By:	
 	

/s/ John M. Moriarty, Jr.
 Name: John M. Moriarty, Jr.

Title: Managing Director
	

 	
 	

DLJ INVESTMENT PARTNERS II, L.P.,
	

 	
 	

By:	
 	

DLJ INVESTMENT PARTNERS, INC., as

managing general partner
	

 	
 	

By:	
 	

/s/ John M. Moriarty, Jr.
 Name: John M. Moriarty, Jr.

Title: Managing Director
	

 	
 	

BNY CAPITAL CORPORATION
	

 	
 	

By:	
 	

/s/ Branko Kimpotic
 Name: Branko Kimpotic

Title: Vice President

	 	 	TCG HIGH YIELD, LLC, AS GENERAL

PARTNER OF CARLYLE HIGH YIELD

PARTNERS, L.P.
	

 	
 	

By:	
 	

/s/ Michael J. Zupon
 Name: Michael J. Zupon

Title: Managing Director
	

 	
 	

CIG & CO., AS NOMINEE FOR CONNECTICUT

GENERAL LIFE INSURANCE COMPANY
	

 	
 	

By:	
 	

/s/ Edward Lewis
 Name: Edward Lewis

Title: Partner
	

 	
 	

CIG & CO., AS NOMINEE FOR LIFE

INSURANCE COMPANY OF NORTH

AMERICA
	

 	
 	

By:	
 	

/s/ Edward Lewis
 Name: Edward Lewis

Title: Partner
	

 	
 	

DLJIP II HOLDINGS, L.P.,
	

 	
 	

By:	
 	

DLJ Investment Partners II, Inc.
 as managing general partner
	

 	
 	

By:	
 	

/s/ John M. Moriarty, Jr.
 Name: John M. Moriarty, Jr.

Title: Managing Partner

	

 	
 	

TCW/Crescent Mezzanine Partners II, L.P. and

TCW/Crescent Mezzanine Trust II
	 	 	By:	 	TCW/Crescent Mezzanine II, L.L.C.

its Investment Manager.
	 	 	By:	 	TCW/Crescent Mezzanine, L.L.C.

As its Managing Owner
	

 	
 	

By:	
 	

/s/ John C. Rocchio
 Name: John C. Rocchio

Title: Managing Director
	

 	
 	

By:	
 	

/s/ James C. Sheviet, Jr.
 Name: James C. Sheviet, Jr.

Title: Senior Vice President
	

 	
 	

TCW Leveraged Income Trust, L.P.
	 	 	By:	 	TCW Advisers (Bermuda), Ltd.

as its General Partner
	

 	
 	

By:	
 	

/s/ Randolph R. Birkman
 Name: Randolph R. Birkman

Title: Managing Director
	

 	
 	

By:	
 	

TCW Investment Management Company

as Investment Adviser
	

 	
 	

By:	
 	

/s/ James C. Sheviet, Jr.
 Name: James C. Sheviet, Jr.

Title: Senior Vice President
	

 	
 	

TCW Leveraged Income Trust II, L.P.
	 	 	By:	 	TCW (LINC II), L.P.

as its General Partner
	

 	
 	

By:	
 	

TCW Advisers (Bermuda), Ltd.

its General Partner
	

 	
 	

By:	
 	

/s/ Randolph R. Birkman
 Name: Randolph R. Birkman

Title: Managing Director

	

 	
 	

By:	
 	

TCW Investment Management Company

as Investment Adviser
	

 	
 	

By:	
 	

/s/ James C. Sheviet, Jr.
 Name: James C. Sheviet, Jr.

Title: Senior Vice President

 
 

EXHIBIT A    
    

 
 

AMENDED AND RESTATED CERTIFICATE OF DESIGNATION    
    

[THIS
EXHIBIT WILL BE PROVIDED TO THE SEC UPON REQUEST] 

 
 

EXHIBIT B    
    

 
 

MERRILL CORPORATION    
    
    FORM OF WARRANT FOR THE PURCHASE OF
  CLASS B COMMON STOCK OF MERRILL CORPORATION    

	NO.	 	SERIES C WARRANTS

THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED OR SOLD EXCEPT IN COMPLIANCE THEREWITH. THIS SECURITY IS ALSO
SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER, VOTING AND OTHER MATTERS AS SET FORTH IN THE INVESTORS' AGREEMENT (AS HEREIN DEFINED), COPIES OF WHICH ARE ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF
THE COMPANY OR ANY SUCCESSOR THERETO. 

        FOR
VALUE RECEIVED, MERRILL CORPORATION, a Minnesota corporation (the "COMPANY"), hereby certifies that
                        , its successor or permitted assigns
(the "HOLDER"), is entitled, subject to the provisions of this Warrant, to purchase from the Company, at the times specified herein, one fully paid and non-assessable share of
Class B common stock of the Company, par value $0.01 per share (the "WARRANT SHARES"), for each Warrant evidenced by this Warrant
Certificate at a purchase price per share equal to the Exercise Price (as hereinafter defined). The number of Warrant Shares to be received upon the exercise of this Warrant and the price to be paid
for a Warrant Share are subject to adjustment from time to time as hereinafter set forth. 

        (a)    DEFINITIONS.    

        (1)   The
following terms, as used herein, have the following meanings: 

        "AFFILIATE"
shall have the meaning given to such term in Rule 12b-2 promulgated under the Securities and Exchange Act of 1934, as amended. 

        "BOARD
OF DIRECTORS" means the Company's Board of Directors. 

        "BUSINESS
DAY" means any day except a Saturday, Sunday or other day on which commercial banks in The City of New York are authorized by law to close. 

        "COMMON
SHARE" means a share of the Company's Class B Common Stock, par value $0.01 per share. 

        "DULY
ENDORSED" means duly endorsed in blank by the Person or Persons in whose name a stock certificate is registered or accompanied by a duly executed stock assignment separate from the
certificate with the signature(s) thereon guaranteed by a commercial bank or 

 

trust
company or a member of a national securities exchange or of the National Association of Securities Dealers, Inc. 

        "EXERCISE
PRICE" means $0.01 per Warrant Share, as such Exercise Price is adjusted from time to time as provided herein. 

        "EXPIRATION
DATE" means August 8, 2012 at 5:00 p.m. New York City time. 

        "FAIR
MARKET VALUE" means, with respect to one Common Share on any date, the Current Market Price Per Common Share for purposes of paragraph (h)(6) hereof. 

        "INVESTORS
AGREEMENT" means the Investors Agreement dated as of November 23, 1999 among Viking Merger Sub, Inc., DLJ Merchant Banking Partners II, L.P., DLJ Merchant
Banking Partners II-A, L.P., DLJ Offshore Partners II, C.V., DLJ Diversified Partners, L.P., DLJ Diversified Partners-A, L.P., DLJ Millennium Partners, L.P., DLJ Millennium
Partners-A, L.P., DLJ Funding II, Inc., DLJ EAB Partners, L.P., DLJ ESC II L.P., DLJ First ESC, L.P., DLJ Investment Partners II, L.P., DLJ Investment Funding II, Inc. and
the other stockholders listed on the signature pages thereto. 

        "OLD
PREFERRED STOCK WARRANTS" means the warrants issued to holders of the Company's 14.5% Senior Preferred Stock due 2011 on November 23, 1999. 

        "OLD
SENIOR SUBORDINATED NOTE WARRANTS" means the warrants issued to holders of the Company's 12% Senior Subordinated Notes due 2009 on November 23, 1999. 

        "PERSON"
means an individual, partnership, corporation, limited liability company, trust, joint stock company, association, joint venture, or any other entity or organization, including
a government or political subdivision or an agency or instrumentality thereof. 

        "PREFERRED
STOCK" means the Company's Preferred Stock due 2011. 

        "PRINCIPAL
HOLDERS" means, on any date, the holders of at least 25% of the Warrants. 

        "SERIES
A WARRANTS" means the Series A Warrants issued by the Company to holders of the Company's 12% Senior Subordinated Notes due 2009 on August 9, 2002. 

        "SERIES
B WARRANTS" means the Series B Warrants to be issued in certain circumstances by the Company to holders of the Company's Class A Senior Subordinated Notes due 2009
and Class B Senior Subordinated Notes due 2009. 

        "SERIES
D WARRANTS" means the Series D Warrants to be issued in certain circumstances by the Company to the holders of the Preferred Stock. 

        "TRANSFER"
shall have the meaning assigned to such term in the Investors' Agreement. 

2

 

        "WARRANTS"
means the Series C Warrants issued to the holders of the Preferred Stock pursuant to the terms of the Preferred Stockholders Agreement dated August 9, 2002. 

        (2)   Capitalized
terms used but not defined herein shall have the meanings assigned to such terms in the Investors' Agreement. 

        (b)    EXERCISE OF WARRANT.    

        (1)   The
Holder is entitled to exercise this Warrant in whole or in part at any time, or from time to time, until the Expiration Date or, if such day is not a Business Day,
then on the next succeeding day that shall be a Business Day. To exercise this Warrant, the Holder shall execute and deliver to the Company a Warrant Exercise Subscription Form forming a part hereof
duly executed by the Holder and payment of the applicable Exercise Price for each Warrant Share subject to such exercise. Upon such delivery and payment, the Holder shall be deemed to be the holder of
record of the Warrant Shares subject to such exercise, notwithstanding that the stock transfer books of the Company shall then be closed or that certificates representing such Warrant Shares shall not
then be actually delivered to the Holder. Notwithstanding anything herein to the contrary, in lieu of payment in cash of the applicable Exercise Price, the Holder may elect (i) to receive upon
exercise of this Warrant, the number of Warrant Shares reduced by a number of Common Shares having the aggregate Fair Market Value equal to the aggregate Exercise Price for the Warrant Shares,
(ii) to deliver as payment, in whole or in part of the aggregate Exercise Price, Common Shares having the aggregate Fair Market Value equal to the aggregate Exercise Price for the Warrant
Shares in respect of which the Exercise Price is not being paid in cash or (iii) to deliver as payment, in whole or in part of the aggregate Exercise Price, such number of Warrants which, if
exercised, would result in a number of Common Shares having an aggregate Fair Market Value equal to the aggregate Exercise Price for the Warrant Shares in respect of which the Exercise Price is not
being paid in cash. Notwithstanding anything to the contrary in this paragraph (b)(1), if the aggregate Fair Market Value of the Common Shares applied or delivered pursuant to (i),
(ii) or (iii) above exceeds the aggregate Exercise Price, in no event shall the Holder be entitled to receive any amounts from the Company. 

        (2)   The
Exercise Price may be paid in cash or by certified or official bank check or bank cashier's check payable to the order of the Company or by any combination of such
cash or check. The Company shall pay any and all documentary, stamp or similar issue or transfer taxes payable in respect of the issue or delivery of the Warrant Shares. 

        (3)   If
the Holder exercises this Warrant in part, this Warrant Certificate shall be surrendered by the Holder to the Company and a new Warrant Certificate of the same tenor
and for the unexercised number of Warrant Shares shall be executed by the Company. The Company shall register the new Warrant Certificate in the name of the Holder or in such name or names of its
transferee pursuant to paragraph (f) hereof as may be directed in writing by the Holder and 

3

 

deliver
the new Warrant Certificate to the Person or Persons entitled to receive the same. 

        (4)   Upon
surrender of this Warrant Certificate in conformity with the foregoing provisions, the Company shall transfer to the Holder of this Warrant Certificate appropriate
evidence of ownership of Common Shares or other securities or property (including any money) to which the Holder is entitled, registered or otherwise placed in, or payable to the order of, the name or
names of the Holder or such transferee as may be directed in writing by the Holder, and shall deliver such evidence of ownership and any other securities or property (including any money) to the
Person or Persons entitled to receive the same, including, if applicable, an amount in cash in lieu of any fraction of a share as provided in paragraph (e) below. 

        (c)    RESTRICTIVE LEGEND.    Certificates representing Common Shares issued pursuant to this Warrant shall bear a
legend substantially in the form of the legend set forth on the first page of this Warrant Certificate to the extent that and for so long as such legend is required pursuant to the Investors'
Agreement or applicable securities laws. 

        (d)    RESERVATION OF SHARES.    The Company hereby agrees that at all times there shall be reserved for issuance and
delivery upon exercise of this Warrant such number of its authorized but unissued Common Shares or other securities of the Company from time to time issuable upon exercise of this Warrant as will be
sufficient to permit the exercise in full of this Warrant. All such shares shall be duly authorized and, when issued upon such exercise, shall be validly issued, fully paid and
non-assessable, free and clear of all liens, security interests, charges and other encumbrances or restrictions on sale and free and clear of all preemptive rights, except to the extent
set forth in the Investors' Agreement. 

        (e)    FRACTIONAL SHARES.    No fractional shares or scrip representing fractional shares shall be issued upon the
exercise of this Warrant and in lieu of delivery of any such fractional share upon any exercise hereof, the Company shall pay to the Holder an amount in cash equal to such fraction multiplied by the
Current Market Price Per Common Share (as defined in paragraph (h)(6)) at the date of such
exercise; PROVIDED that if any of the Company's debt agreements at the time of exercise would prohibit such a payment, no such payment shall be made. 

        The
Company further agrees that it will not change the par value of the Common Shares to any higher par value which exceeds the Exercise Price then in effect, and will reduce the par
value of the Common Shares upon any event described in paragraph (h) that (i) provides for an increase in the number of Common Shares subject to purchase upon exercise of this Warrant,
in inverse proportion to and effective at the same time as such number of shares is increased, but only to the extent that such increase in the number of shares, together with all other such increases
after the date hereof, causes the aggregate Exercise Price of all Warrants (without giving effect to any exercise thereof) to be greater than the product of all Warrants issued multiplied by $0.01 or
(ii) would, but for this provision, reduce the Exercise Price below the par value of the Common Shares. 

4

 

        (f)    EXCHANGE, TRANSFER OR ASSIGNMENT OF WARRANT.    

        (1)   This
Warrant and the Warrant Shares are subject to the provisions of the Investors' Agreement, including the applicable restrictions on transfer. Each taker and holder
of this Warrant Certificate by taking or holding the same, consents and agrees that the registered holder hereof may be treated by the Company and all other persons dealing with this Warrant
Certificate as the absolute owner hereof for any purpose and as the person entitled to exercise the rights represented hereby. The Holder, by its acceptance of this Warrant, will be subject to the
provisions of, and will have the benefits of, the Investors' Agreement to the extent set forth therein, including the applicable transfer restrictions and the registration rights included therein. 

        (2)   Subject
to compliance with the transfer restrictions set forth in the Investors' Agreement and with applicable securities laws, upon surrender of this Warrant to the
Company, together with the attached Warrant Assignment Form duly executed, the Company shall, without charge, execute and deliver a new Warrant in the name of the assignee or assignees named in such
instrument of assignment and, if the Holder's entire interest is not being assigned, in the name of the Holder and this Warrant shall promptly be canceled. 

        (g)    LOSS OR DESTRUCTION OF WARRANT.    Upon receipt by the Company of evidence satisfactory to it (in the exercise
of its reasonable discretion) of the loss, theft, destruction or mutilation of this Warrant Certificate, and (in the case of loss, theft or destruction) of reasonably satisfactory indemnification, and
upon surrender and cancellation of this Warrant Certificate, if mutilated, the Company shall execute and deliver a new Warrant Certificate of like tenor and date. 

        (h)    ANTI-DILUTION PROVISIONS.    The Exercise Price of this Warrant and the number of Common Shares for
which this Warrant may be exercised shall be subject to adjustment from time to time upon the occurrence of certain events as provided in this paragraph (h). 

        (1)   In
case the Company shall at any time after the date hereof (i) declare a dividend or make a distribution on Common Shares payable in Common Shares,
(ii) subdivide or split the outstanding Common Shares, (iii) combine or reclassify the outstanding Common Shares into a smaller number of shares, or (iv) issue any shares of its
capital stock in a reclassification of Common Shares (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing corporation), the Exercise
Price in effect at the time of the record date for such dividend or distribution or of the effective date of such subdivision, split, combination or reclassification shall be proportionately adjusted
so that, giving effect to paragraph (h)(9), the exercise of this Warrant after such time shall entitle the holder to receive the aggregate number of Common Shares or other securities of the
Company (or shares of any security into which such shares of Common Stock have been reclassified pursuant to clause (iii) or (iv) above) which, if this Warrant 

5

 

had
been exercised immediately prior to such time, such holder would have owned upon such exercise and been entitled to receive by virtue of such dividend, distribution, subdivision, split,
combination or reclassification. Such adjustment shall be made successively whenever any event listed above shall occur. 

        (2)   In
case the Company shall issue or sell any Common Shares (other than common shares issued (I) upon exercise of the Warrants, the Old Preferred Stock Warrants,
the Old Senior Subordinated Note Warrants, the Series A Warrants, the Series B Warrants or the Series D Warrants, (II) pursuant to any stock option,
co-investment or other stock-related employee compensation plan of the Company approved by the Board of Directors, (III) upon exercise or conversion of any security the issuance of
which caused an adjustment under paragraphs (h)(3) or (h)(4) hereof or (IV) in any Public Offering (as defined in the Indenture dated as of August 9, 2002 between HSBC Bank USA, as
Trustee, the Company and the Guarantors party thereto relating to those certain Class A Senior Subordinated Notes due 2009, as in effect on the date hereof) generating gross proceeds of at
least $25.0 million, the Exercise Price to be in effect after such issuance or sale shall be determined by multiplying the Exercise Price in effect immediately prior to such issuance or sale by
a fraction, the numerator of which shall be the sum of (x) the number of Common Shares outstanding immediately prior to the time of such issuance or sale multiplied by the Current Market Price
Per Common Share immediately prior to such issuance or sale and (y) the aggregate consideration, if any, to be received by the Company upon such issuance or sale, and the denominator of which
shall be the product of the aggregate number of Common Shares outstanding immediately after such issuance or sale and the Current Market Price Per Common Share immediately prior to such issuance or
sale but in no event will such fraction exceed 1. In case any portion of the consideration to be received by the Company shall be in a form other than cash, the fair market value of such noncash
consideration shall be utilized in the foregoing computation. Such fair market value shall be determined by the Board of Directors of the Company; PROVIDED that if the Principal Holders shall object
to any such determination, the Board of Directors shall retain an independent appraiser reasonably satisfactory to the Principal Holders to determine such fair market value. The Holders shall be
notified promptly of any consideration other
than cash to be received by the Company and furnished with a description of the consideration and the fair market value thereof, as determined by the Board of Directors. 

        (3)   In
case the Company shall fix a record date for the issuance of rights, options or warrants to the holders of its Common Shares or other securities entitling such
holders to subscribe for or purchase for a period expiring within 60 days of such record date Common Shares (or securities convertible into Common Shares) at a price per Common Share (or having
a conversion price per share of Common Share, if a security convertible into Common Shares) less than the Current Market Price Per Common Share on such record date, the maximum number of Common Shares
issuable upon exercise of such rights, options or warrants (or conversion of such convertible securities) shall be deemed to have 

6

 

been
issued and outstanding as of such record date and the Exercise Price shall be adjusted pursuant to paragraph (h)(2) hereof, as though such maximum number of Common Shares had been so
issued for the aggregate consideration payable by the holders of such rights, options, warrants or convertible securities prior to their receipt of such Common Shares. In case any portion of such
consideration shall be in a form other than cash, the fair market value of such noncash consideration shall be determined as set forth in paragraph (h)(2) hereof. Such adjustment shall be made
successively whenever such record date is fixed; and in the event that such rights, options or warrants are not so issued or expire unexercised, or in the event of a change in the number of Common
Shares to which the holders of such rights, options or warrants are entitled (other than pursuant to adjustment provisions therein which are no more favorable in their entirety than those contained in
this paragraph (h)), the Exercise Price shall again be adjusted to be the Exercise Price which would then be in effect if such record date had not been fixed, in the former event, or the
Exercise Price which would then be in effect if such holder had initially been entitled to such changed number of Common Shares, in the latter event. 

        (4)   In
case the Company shall sell or issue rights, options (other than options issued pursuant to a plan described in clause II of paragraph (h)(2)) or
warrants (other than Series B Warrants or Series D Warrants) entitling the holders thereof to subscribe for or purchase Common Shares (or securities convertible into Common Shares) or
shall issue convertible securities and the price per Common Share of such rights, options, warrants or convertible securities (including, in the case of rights, options, warrants or convertible
securities, the price at which they may be exercised or converted) is less than the Current Market Price Per Common Share, the maximum number of Common Shares issuable upon exercise of such rights,
options or warrants or upon conversion of such convertible securities shall be deemed to have been issued and outstanding as of the date of such sale or issuance, and the Exercise Price shall be
adjusted pursuant to paragraph (h)(2) hereof as though such maximum number of Common Shares had been so issued for an aggregate consideration equal to the aggregate consideration paid for such
rights, options, warrants or convertible securities and the aggregate consideration payable by the holders of such rights, options, warrants or convertible securities prior to their receipt of such
Common Shares. In case any portion of such consideration shall be in a form other than cash, the fair market value of such noncash consideration shall be determined as set forth in
paragraph (h)(2) hereof. Such adjustment shall be made successively whenever such rights, options, warrants or convertible securities are issued; and in the event that such rights, options or
warrants expire unexercised, or in the event of a change in the number of shares of Common Shares to which the holders of such rights, options, warrants or convertible securities are entitled (other
than pursuant to adjustment provisions therein which are no more favorable in their entirety than those contained in this paragraph (h)), the Exercise Price shall again be adjuted to be the
Exercise Price which would then
be in effect if such rights, options, warrants or convertible securities had not been issued, in the former event, or the Exercise Price which would then be in effect if such holders had initially
been 

7

 

entitled
to such changed number of Common Shares, in the latter event. No adjustment of the Exercise Price shall be made pursuant to this paragraph (h)(4) to the extent that the Exercise Price
shall have been adjusted pursuant to paragraph (h)(3) upon the setting of any record date relating to such rights, options, warrants or convertible securities and such adjustment fully reflects
the number of Common Shares to which the holders of such rights, options, warrants or convertible securities are entitled and the price payable therefor. 

        (5)   In
case the Company shall fix a record date for the making of a distribution to holders of Common Shares (including any such distribution made in connection with a
consolidation or merger, other than the merger referred to in paragraph (o), in which the Company is the continuing corporation) of evidences of indebtedness, cash, assets or other property
(other than dividends payable in Common Shares or rights, options or warrants referred to in, and for which an adjustment is made pursuant to, paragraphs (h)(3) or (h)(4) hereof), the Exercise Price
to be in effect after such record date shall be determined by multiplying the Exercise Price in effect immediately prior to such record date by a fraction, the numerator of which shall be the Current
Market Price Per Common Share on such record date, less the fair market value (determined as set forth in paragraph (h)(2) hereof) of the portion of the assets, cash, other property or evidence
of indebtedness so to be distributed which is applicable to one Common Share, and the denominator of which shall be such Current Market Price Per Common Share. Such adjustments shall be made
successively whenever such a record date is fixed; and in the event that such distribution is not so made, the Exercise Price shall again be adjusted to be the Exercise Price which would then be in
effect if such record date had not been fixed. 

        (6)   For
the purpose of any computation under paragraph (e) or paragraph (h)(2), (3), (4) or (5) hereof, on any determination date, the Current
Market Price Per Common Share (the "CURRENT MARKET PRICE PER COMMON SHARE") shall be deemed to be the average (weighted by daily trading volume) of the Daily Prices (as defined below) per Common Share
for the 20 consecutive trading days ending three days prior to such date. "DAILY PRICE" means (1) if the Common Shares then are listed and traded on the New York Stock Exchange, Inc.
("NYSE"), the closing price on such day as reported on the NYSE Composite Transactions Tape; (2) if the Common Shares then are not listed and traded on the NYSE, the closing price on such day
as reported by the principal national securities exchange on which the shares are listed and traded; (3) if the Common Shares then are not listed and traded on any such securities exchange, the
last reported sale price on such day on the National Market of the National Association of Securities Dealers, Inc. Automated Quotation System ("NASDAQ"); (4) if the Common Shares then
are not listed and traded on any such securities exchange and not traded on the NASDAQ National Market, the average of the highest reported bid and lowest reported asked price on such day as reported
by NASDAQ; or (5) if such shares are not listed and traded on any such securities exchange, not traded on the NASDAQ National Market and bid and asked prices are not reported by NASDAQ, then
the 

8

 

average
of the closing bid and asked prices, as reported by The Wall Street Journal for the over-the-counter market. If on any determination date the Common Shares are not
quoted by any such organization, the Current Market Price Per Common Share shall be the fair market value of such shares on such determination date as determined by the Board of Directors, without
regard to considerations of the lack of liquidity, applicable regulatory restrictions or any of the transfer restrictions or other obligations imposed on such shares set forth in the Investors'
Agreement. If the Principal Holders shall object to any determination by the Board of Directors of the Current Market Price Per Common Share, the Current Market Price Per Common Share shall be the
fair market value per Common Share as determined by an independent appraiser retained by the Company at its expense and reasonably acceptable to the Principal Holders. For purposes of any computation
under this paragraph (h), the number of Common Shares outstanding at any given time shall not include shares owned or held by or for the account of the Company. 

        (7)   No
adjustment in the Exercise Price shall be required unless such adjustment would require an increase or decrease of at least one percent in such price; PROVIDED that
any adjustments which by reason of this paragraph (h)(7) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this
paragraph (h) shall be made to the nearest one hundredth of a cent or to the nearest hundredth of a share, as the case may be. 

        (8)   In
the event that, at any time as a result of the provisions of this paragraph (h), the holder of this Warrant upon subsequent exercise shall become entitled to
receive any shares of capital stock or other securities of the Company other than Common Shares, the number of such other shares so receivable upon exercise of this Warrant shall thereafter be subject
to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions contained herein. 

        (9)   Upon
each adjustment of the Exercise Price as a result of the calculations made in paragraphs (h)(1), (2), (3), (4) or (5) hereof, the number of shares for
which this Warrant is exercisable immediately prior to the making of such adjustment shall thereafter evidence the right to purchase, at the adjusted Exercise Price, that number of Common Shares
obtained by (i) multiplying the number of shares covered by this Warrant immediately prior to this adjustment of the number of shares by the Exercise Price in effect immediately prior to such
adjustment of the Exercise Price and (ii) dividing the product so obtained by the Exercise Price in effect immediately after such adjustment of the Exercise Price. 

        (10) The
Company shall notify all Holders of the fixing of a record date for the purpose of payment of a cash dividend to holders of Common Shares as soon as reasonably
practicable, but in no event less than 20 days prior to any such record date. 

9

  

        (11) Not
less than 10 nor more than 30 days prior to the record date or effective date, as the case may be, of any action which requires or might require an
adjustment or readjustment pursuant to this paragraph (h), the Company shall forthwith file in the custody of this Secretary or an Assistant Secretary at its principal executive office and with
its stock transfer agent or its warrant agent, if any, an officers' certificate showing the adjusted Exercise Price determined as herein provided, setting forth in reasonable detail the facts
requiring such adjustment and the manner of computing such adjustment. Each such officers' certificate shall be signed by the chairman, president or chief financial officer of the Company and by the
secretary or any assistant secretary of the Company. Each such officers' certificate shall be made available at all reasonable times for inspection by the Holder or any holder of a Warrant executed
and delivered pursuant to paragraph (f) and the Company shall, forthwith after each such adjustment, mail a copy, by first-class mail, of such certificate to the Holder. 

        (12) The
Holder shall, at its option, be entitled to receive, in lieu of the adjustment pursuant to paragraph (h)(5) otherwise required thereof, on the date of
exercise of the Warrants, the evidences of indebtedness, other securities, cash, property or other assets which such Holder would have been entitled to receive if it had exercised its Warrants for
Common Shares immediately prior to the record date with respect to such distribution. The Holder may exercise its option under this paragraph (h)(12) by delivering to the Company a written
notice of such exercise within seven days of its receipt of the certificate of adjustment required pursuant to paragraph (h)(11) to be delivered by the Company in connection with such
distribution. 

        (i)    CONSOLIDATION, MERGER, OR SALE OF ASSETS.    In case of any consolidation of the Company with, or merger of the
Company into, any other Person, any merger of another Person into the Company (other than a merger which does not result in any reclassification, conversion, exchange or cancellation of outstanding
Common Shares) or any sale or transfer of all or substantially all of the assets of the Company or of the Person formed by such consolidation or resulting from such merger or which acquires such
assets, as the case may be, the Holder shall have the right thereafter to exercise this Warrant for the kind and amount of securities, cash and other property receivable upon such consolidation,
merger, sale or transfer by a holder of the number of Common Shares for which this Warrant may have been exercised immediately prior to such consolidation, merger, sale or transfer, assuming
(i) such holder of Common Shares is not a Person with which the Company consolidated or into which the Company merged or which merged into the Company or to which such sale or transfer was
made, as the case may be ("CONSTITUENT PERSON"), or an Affiliate of a constituent Person and (ii) in the case of a consolidation, merger, sale or transfer which includes an election as to the
consideration to be received by the holders, such holder of Common Shares failed to exercise its rights of election, as to the kind or amount of securities, cash and other property receivable upon
such consolidation, merger, sale or transfer (provided that if the kind or amount of securities, cash and other property receivable upon such consolidation, merger, sale or transfer is not the same
for each Common Share held immediately prior to such consolidation, merger, sale or transfer by a Person other than a constituent Person or an Affiliate thereof and in respect of which such rights of
election shall not have been exercised ("NON-ELECTING SHARE"), then 

10

 

for
the purpose of this paragraph (i) the kind and amount of securities, cash and other property receivable upon such consolidation, merger, sale or transfer for each non-electing
share shall be deemed to be the kind and amount so receivable per share by a plurality of the non-electing shares). Adjustments for events subsequent to the effective date of such a
consolidation, merger and sale of assets shall be as nearly equivalent as may be practicable to the adjustments provided for in this Warrant. In any such event, effective provisions shall be made in
the certificate or articles of incorporation of the resulting or surviving corporation, in any contract of sale, conveyance, lease or transfer, or otherwise so that the provisions set forth herein for
the protection of the rights of the Holder shall thereafter continue to be applicable; and any such resulting or surviving corporation shall expressly assume the obligation to deliver, upon exercise,
such shares of stock, other securities, cash and property. The provisions of this paragraph (i) shall similarly apply to successive consolidations, mergers, sales, leases or transfers.
Notwithstanding the foregoing provisions of this paragraph (i), the treatment of this Warrant in connection with the merger of the Company with and into Merrill Corporation shall be governed by
paragraph (o). 

        (j)    NOTICES.    Any notice, demand or delivery authorized by this Warrant Certificate shall be in writing and shall
be given to the Holder or the Company as the case may be, at its address (or telecopier number) set forth below, or such other address (or telecopier number) as shall have been furnished to the party
giving or making such notice, demand or delivery: 

	If to the Company:	Merrill Corporation

One Merrill Circle

St. Paul, Minnesota 55108

Telecopy: (651) 632-4141

Attention: General Counsel
	

If to the Holder:	

To the address of such holder set forth on the signature page hereof.

        Each
such notice, demand or delivery shall be effective (i) if given by telecopy, when such telecopy is transmitted to the telecopy number specified herein and the intended
recipient confirms the receipt of such telecopy or (ii) if given by any other means, when received at the address specified herein. 

11

 

        (k)    RIGHTS OF THE HOLDER.    Prior to the exercise of any Warrant, the Holder shall not, by virtue hereof, be
entitled to any rights of a shareholder of the Company, including, without limitation, the right to vote, to receive dividends or other distributions or to receive any notice of meetings of
shareholders or any notice of any proceedings of the Company except as may be specifically provided for herein. 

        (l)    REGISTRATION RIGHTS.    The Holder of this Warrant is entitled to the registration rights relating to the
Warrants and the Warrant Shares set forth in the Investors' Agreement. 

        (m)    GOVERNING LAW.    THIS WARRANT CERTIFICATE AND ALL RIGHTS ARISING HEREUNDER SHALL BE CONSTRUED AND DETERMINED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS AND THE PERFORMANCE THEREOF SHALL BE GOVERNED AND ENFORCED IN ACCORDANCE WITH SUCH LAWS. 

        (n)    AMENDMENTS; WAIVERS.    Any provision of this Warrant Certificate may be amended or waived if, and only if,
such amendment or waiver is in writing and signed, in the case of an amendment, by the Holder and the Company, or in the case of a waiver, by the party against whom the waiver is to be effective. No
failure or delay by either party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law. 

12

        IN
WITNESS WHEREOF, the Company has duly caused this Warrant Certificate to be signed by its duly authorized officer and to be dated as of
                        . 

	 	 	MERRILL CORPORATION
	

 	
 	

By:	
 	

    

	 	 	 	 	Name:
	 	 	 	 	Title:

	Acknowledged and Agreed:	 	 
	

[HOLDER]	
 	

 
	

By:	
 	

    
	
 	

 
	 	 	Name:	 	 
	 	 	Title:	 	 
	

 	
 	

[Address]	
 	

 

 
 

WARRANT SUBSCRIPTION FORM    

To:
Merrill Corporation 

        The
undersigned irrevocably exercises the Warrant for the purchase of                          Common Shares (the "SHARES"),
par value $0.01 per share, of Merrill
Corporation (the "COMPANY") at $             per Share (the Exercise Price currently in effect pursuant to the Warrant) and herewith makes payment of
$             (such payment being made in cash or by certified or official bank or bank cashier's check payable to the order of the Company or by any permitted
combination of such cash or check), all on the terms and conditions specified in the within Warrant Certificate, surrenders this Warrant Certificate and all right, title and interest therein to the
Company and directs that the Shares deliverable upon the exercise of this Warrant be registered or placed in the name and at the address specified below and delivered thereto. 

-OR-

        The
undersigned irrevocably exercises the Warrant for the purchase of                          Common Shares (the "SHARES"),
par value $0.01 per share, of Merrill
Corporation (the "COMPANY") at $             per Share (the Exercise Price currently in effect pursuant to the Warrant) (provided that in lieu of payment of
$            , the undersigned will receive a number of Shares reduced by a number of Common Shares having an aggregate Fair Market Value (as defined in the Warrant)
equal to the aggregate Exercise Price for the Shares), all on the terms and conditions specified in the within Warrant Certificate, surrenders this Warrant Certificate and all right, title and
interest therein to the Company and directs that the Shares deliverable upon the exercise of this Warrant be registered or placed in the name and at the address specified below and delivered thereto. 

-OR-

        The
undersigned irrevocably exercises the Warrant for the purchase of                          Common Shares (the "SHARES"),
par value $0.01 per share, of Merrill
Corporation (the "COMPANY") at $             per Share (the Exercise Price currently in effect pursuant to the Warrant), and herewith makes payment of
$             of the aggregate Exercise Price for the Shares in cash, certified or official bank or bank cashier's check (or a
combination of cash and check), and herewith delivers as payment of $             of the aggregate Exercise Price that number of Common Shares having an aggregate Fair
Market Value (as defined in the Warrant) equal to such non-cash portion of the aggregate Exercise Price for the Shares, all on the terms and conditions specified in the within Warrant
Certificate, surrenders this Warrant Certificate and all right, title and interest therein to the Company and directs that the Shares deliverable upon the exercise of this Warrant be registered or
placed in the name and at the address specified below and delivered thereto. 

-OR-

        The
undersigned irrevocably exercises the Warrant for the purchase of                          Common Shares (the "SHARES"),
par value $0.01 per share, of Merrill
Corporation (the "COMPANY") at $             per share (the Exercise Price currently in effect pursuant to the Warrant), and herewith 

 

makes
payment of $             of the aggregate Exercise Price for the Shares in cash, certified or official bank or bank cashier's check (or a combination of cash and
check), and herewith delivers as payment of $             of the aggregate Exercise Price that number of Warrants which, if exercised, would result in a number of
Common Shares having an aggregate Fair Market Value (as defined in the Warrant) equal to such non-cash portion of the aggregate Exercise Price for the Shares, all on the terms and
conditions specified in the within Warrant Certificate, surrenders this Warrant Certificate and all right, title and interest therein to the Company and directs that the Shares deliverable upon the
exercise of this Warrant be registered or placed in the name and at the address specified below and delivered thereto. 

        Date:
                        ,             . 

	 	 	    
 (Signature of Owner)
	

 	
 	

    
 (Street Address)
	

 	
 	

    
 (City) (State) (Zip Code)

2

 

Securities
and/or check to be issued to: 

Please
insert social security or identifying number: 

Name:

Street
Address: 

City,
State and Zip Code: 

Any
unexercised portion of the Warrant evidenced by the within Warrant Certificate to be issued to: 

Please
insert social security or identifying number: 

Name: 

Street
Address: 

City,
State and Zip Code: 

3

 
 

WARRANT ASSIGNMENT FORM    

	 	 	Dated	 	 
	 	 	 	 	

	FOR VALUE RECEIVED,	 	 	 	 	 	 
	 	 	

	

hereby sells, assigns and transfers unto,
	

 	
 	

 	
 	

 	
 	

(the "ASSIGNEE"),
	
 (please type or print in block letters)	 	 
	

 (insert address)

its
right to purchase up to              Common Shares represented by this Warrant and does hereby irrevocably constitute and appoint
                                         
        Attorney, to transfer the same on the books of the Company, with full power of substitution in the premises. 

	 	 	Signature	 
	 	 	 	

 
 

EXHIBIT C    
    

 
 

MERRILL CORPORATION    
    
    FORM OF WARRANT FOR THE PURCHASE OF
  CLASS B COMMON STOCK OF MERRILL CORPORATION    

	NO.           	 	             SERIES D WARRANTS

THIS
SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED OR SOLD EXCEPT IN COMPLIANCE THEREWITH. THIS SECURITY IS ALSO
SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER, VOTING AND OTHER MATTERS AS SET FORTH IN THE INVESTORS' AGREEMENT (AS HEREIN DEFINED), COPIES OF WHICH ARE ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF
THE COMPANY OR ANY SUCCESSOR THERETO. 

        FOR
VALUE RECEIVED, MERRILL CORPORATION, a Minnesota corporation (the "COMPANY"), hereby certifies that
                        , its successor or
permitted assigns (the "HOLDER"), is entitled, subject to the provisions of this Warrant, to purchase from the Company, at the times specified herein, one fully paid and non-assessable
share of Class B common stock of the Company, par
value $0.01 per share (the "WARRANT SHARES"), for each Warrant evidenced by this Warrant Certificate at a purchase price per share equal to the Exercise Price (as hereinafter defined). The number of
Warrant Shares to be received upon the exercise of this Warrant and the price to be paid for a Warrant Share are subject to adjustment from time to time as hereinafter set forth. 

        (a)   DEFINITIONS.

        (1)   The
following terms, as used herein, have the following meanings: 

        "AFFILIATE"
shall have the meaning given to such term in Rule 12b-2 promulgated under the Securities and Exchange Act of 1934, as amended. 

        "BOARD
OF DIRECTORS" means the Company's Board of Directors. 

        "BUSINESS
DAY" means any day except a Saturday, Sunday or other day on which commercial banks in The City of New York are authorized by law to close. 

        "COMMON
SHARE" means a share of the Company's Class B Common Stock, par value $0.01 per share. 

        "DULY
ENDORSED" means duly endorsed in blank by the Person or Persons in whose name a stock certificate is registered or accompanied by a duly executed stock assignment separate from the
certificate with the signature(s) thereon guaranteed by a commercial bank or 

 

trust
company or a member of a national securities exchange or of the National Association of Securities Dealers, Inc. 

        "EXERCISE
PRICE" means $0.01 per Warrant Share, as such Exercise Price is adjusted from time to time as provided herein. 

        "EXPIRATION
DATE" means August 8, 2012 at 5:00 p.m. New York City time. 

        "FAIR
MARKET VALUE" means, with respect to one Common Share on any date, the Current Market Price Per Common Share for purposes of paragraph (h)(6) hereof. 

        "INVESTORS
AGREEMENT" means the Investors Agreement dated as of November 23, 1999 among Viking Merger Sub, Inc., DLJ Merchant Banking Partners II, L.P., DLJ Merchant
Banking Partners II-A, L.P., DLJ Offshore Partners II, C.V., DLJ Diversified Partners, L.P., DLJ Diversified Partners-A, L.P., DLJ Millennium Partners, L.P., DLJ Millennium
Partners-A, L.P., DLJ Funding II, Inc., DLJ EAB Partners, L.P., DLJ ESC II L.P., DLJ First ESC, L.P., DLJ Investment Partners II, L.P., DLJ Investment Funding II, Inc. and
the other stockholders listed on the signature pages thereto. 

        "OLD
PREFERRED STOCK WARRANTS" means the warrants issued to holders of the Company's 14.5% Senior Preferred Stock due 2011 on November 23, 1999. 

        "OLD
SENIOR SUBORDINATED NOTE WARRANTS" means the warrants issued to holders of the Company's 12% Senior Subordinated Notes due 2009 on November 23, 1999. 

        "PERSON"
means an individual, partnership, corporation, limited liability company, trust, joint stock company, association, joint venture, or any other entity or organization, including
a government or political subdivision or an agency or instrumentality thereof. 

        "PREFERRED
STOCK" means the Company's Preferred Stock due 2011. 

        "PRINCIPAL
HOLDERS" means, on any date, the holders of at least 25% of the Warrants. 

        "SERIES
A WARRANTS" means the Series A Warrants issued by the Company to holders of the Company's 12% Senior Subordinated Notes due 2009 on August 9, 2002. 

        "SERIES
B WARRANTS" means the Series B Warrants to be issued in certain circumstances by the Company to holders of the Company's Class A Senior Subordinated Notes due 2009
and Class B Senior Subordinated Notes due 2009. 

        "SERIES
C WARRANTS" means the Series C Warrants to be issued in certain circumstances by the Company to the holders of the Preferred Stock. 

        "TRANSFER"
shall have the meaning assigned to such term in the Investors' Agreement. 

2

 

        "WARRANTS"
means the Series D Warrants issued to the holders of the Preferred Stock pursuant to the terms of the Preferred Stockholders Agreement dated August 9, 2002. 

        (2)   Capitalized
terms used but not defined herein shall have the meanings assigned to such terms in the Investors' Agreement. 

        (b)   EXERCISE
OF WARRANT. 

        (1)   The
Holder is entitled to exercise this Warrant in whole or in part at any time, or from time to time, until the Expiration Date or, if such day is not a Business Day,
then on the next succeeding day that shall be a Business Day. To exercise this Warrant, the Holder shall execute and deliver to the Company a Warrant Exercise Subscription Form forming a part hereof
duly executed by the Holder and payment of the applicable Exercise Price for each Warrant Share subject to such exercise. Upon such delivery and payment, the Holder shall be deemed to be the holder of
record of the Warrant Shares subject to such exercise, notwithstanding that the stock transfer books of the Company shall then be closed or that certificates representing such Warrant Shares shall not
then be actually delivered to the Holder. Notwithstanding anything herein to the contrary, in lieu of payment in cash of the applicable Exercise Price, the Holder may elect (i) to receive upon
exercise of this Warrant, the number of Warrant Shares reduced by a number of Common Shares having the aggregate Fair Market Value equal to the aggregate Exercise Price for the Warrant Shares,
(ii) to deliver as payment, in whole or in part of the aggregate Exercise Price, Common Shares having the aggregate Fair Market Value equal to the aggregate Exercise Price for the Warrant
Shares in respect of which the Exercise Price is not being paid in cash or (iii) to deliver as payment, in whole or in part of the aggregate Exercise Price, such number of Warrants which, if
exercised, would result in a number of Common Shares having an aggregate Fair Market Value equal to the aggregate Exercise Price for the Warrant Shares in respect of which the Exercise Price is not
being paid in cash. Notwithstanding anything to the contrary in this paragraph (b)(1), if the aggregate Fair Market Value of the Common Shares applied or delivered pursuant to (i),
(ii) or (iii) above exceeds the aggregate Exercise Price, in no event shall the Holder be entitled to receive any amounts from the Company. 

        (2)   The
Exercise Price may be paid in cash or by certified or official bank check or bank cashier's check payable to the order of the Company or by any combination of such
cash or check. The Company shall pay any and all documentary, stamp or similar issue or transfer taxes payable in respect of the issue or delivery of the Warrant Shares. 

        (3)   If
the Holder exercises this Warrant in part, this Warrant Certificate shall be surrendered by the Holder to the Company and a new Warrant Certificate of the same tenor
and for the unexercised number of Warrant Shares shall be executed by the Company. The Company shall register the new Warrant Certificate in the name of the Holder or in such name or names of its
transferee pursuant to paragraph (f) hereof as may be directed in writing by the Holder and 

3

 

deliver
the new Warrant Certificate to the Person or Persons entitled to receive the same. 

        (4)   Upon
surrender of this Warrant Certificate in conformity with the foregoing provisions, the Company shall transfer to the Holder of this Warrant Certificate appropriate
evidence of ownership of Common Shares or other securities or property (including any money) to which the Holder is entitled, registered or otherwise placed in, or payable to the order of, the name or
names of the Holder or such transferee as may be directed in writing by the Holder, and shall deliver such evidence of ownership and any other securities or property (including any money) to the
Person or Persons entitled to receive the same, including, if applicable, an amount in cash in lieu of any fraction of a share as provided in paragraph (e) below. 

        (c)   RESTRICTIVE
LEGEND. Certificates representing Common Shares issued pursuant to this Warrant shall bear a legend substantially in the form of the legend set forth on the
first page of this Warrant Certificate to the extent that and for so long as such legend is required pursuant to the Investors' Agreement or applicable securities laws. 

        (d)   RESERVATION
OF SHARES. The Company hereby agrees that at all times there shall be reserved for issuance and delivery upon exercise of this Warrant such number of its
authorized but unissued Common Shares or other securities of the Company from time to time issuable upon exercise of this Warrant as will be sufficient to permit the exercise in full of this Warrant.
All such shares shall be duly authorized and, when issued upon such exercise, shall be validly issued, fully paid and non-assessable, free and clear of all liens, security interests,
charges and other encumbrances or restrictions on sale and free and clear of all preemptive rights, except to the extent set forth in the Investors' Agreement. 

        (e)   FRACTIONAL
SHARES. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant and in lieu of delivery of any such
fractional share upon any exercise hereof, the Company shall pay to the Holder an amount in cash equal to such fraction multiplied by the Current Market Price Per Common Share (as defined in
paragraph (h)(6)) at the date of such exercise; PROVIDED that if any of the Company's debt agreements at the time of exercise would prohibit such a payment, no such payment shall be made. 

        The
Company further agrees that it will not change the par value of the Common Shares to any higher par value which exceeds the Exercise Price then in effect, and will reduce the par
value of the Common Shares upon any event described in paragraph (h) that (i) provides for an increase in the number of Common Shares subject to purchase upon exercise of this Warrant,
in inverse proportion to and effective at the same time as such number of shares is increased, but only to the extent that such increase in the number of shares, together with all other such increases
after the date hereof, causes the aggregate Exercise Price of all Warrants (without giving effect to any exercise thereof) to be greater than the product of all Warrants issued multiplied by $0.01 or
(ii) would, but for this provision, reduce the Exercise Price below the par value of the Common Shares. 

4

 

        (f)    EXCHANGE,
TRANSFER OR ASSIGNMENT OF WARRANT. 

        (1)   This
Warrant and the Warrant Shares are subject to the provisions of the Investors' Agreement, including the applicable restrictions on transfer. Each taker and holder
of this Warrant Certificate by taking or holding the same, consents and agrees that the registered holder hereof may be treated by the Company and all other persons dealing with this Warrant
Certificate as the absolute owner hereof for any purpose and as the person entitled to exercise the rights represented hereby. The Holder, by its acceptance of this Warrant, will be subject to the
provisions of, and will have the benefits of, the Investors' Agreement to the extent set forth therein, including the applicable transfer restrictions and the registration rights included therein. 

        (2)   Subject
to compliance with the transfer restrictions set forth in the Investors' Agreement and with applicable securities laws, upon surrender of this Warrant to the
Company, together with the attached Warrant Assignment Form duly executed, the Company shall, without charge, execute and deliver a new Warrant in the name of the assignee or assignees named in such
instrument of assignment and, if the Holder's entire interest is not being assigned, in the name of the Holder and this Warrant shall promptly be canceled. 

        (g)   LOSS
OR DESTRUCTION OF WARRANT. Upon receipt by the Company of evidence satisfactory to it (in the exercise of its reasonable discretion) of the loss, theft, destruction
or mutilation of this Warrant Certificate, and (in the case of loss, theft or destruction) of reasonably satisfactory indemnification, and upon surrender and cancellation of this Warrant Certificate,
if mutilated, the Company shall execute and deliver a new Warrant Certificate of like tenor and date. 

        (h)   ANTI-DILUTION
PROVISIONS. The Exercise Price of this Warrant and the number of Common Shares for which this Warrant may be exercised shall be subject to
adjustment from time to time upon the occurrence of certain events as provided in this paragraph (h). 

        (1)   In
case the Company shall at any time after the date hereof (i) declare a dividend or make a distribution on Common Shares payable in Common Shares,
(ii) subdivide or split the outstanding Common Shares, (iii) combine or reclassify the outstanding Common Shares into a smaller number of shares, or (iv) issue any shares of its
capital stock in a reclassification of Common Shares (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing corporation), the Exercise
Price in effect at the time of the record date for such dividend or distribution or of the effective date of such subdivision, split, combination or reclassification shall be proportionately adjusted
so that, giving effect to paragraph (h)(9), the exercise of this Warrant after such time shall entitle the holder to receive the aggregate number of Common Shares or other securities of the
Company (or shares of any security into which such shares of Common Stock have been reclassified pursuant to clause (iii) or (iv) above) which, if this Warrant 

5

 

had
been exercised immediately prior to such time, such holder would have owned upon such exercise and been entitled to receive by virtue of such dividend, distribution, subdivision, split,
combination or reclassification. Such adjustment shall be made successively whenever any event listed above shall occur. 

        (2)   In
case the Company shall issue or sell any Common Shares (other than common shares issued (I) upon exercise of the Warrants, the Old Preferred Stock Warrants,
the Old Senior Subordinated Note Warrants, the Series A Warrants, the Series B Warrants or the Series C Warrants, (II) pursuant to any stock option,
co-investment or other stock-related employee compensation plan of the Company approved by the Board of Directors, (III) upon exercise or conversion of any security the issuance of
which caused an adjustment under paragraphs (h)(3) or (h)(4) hereof or (IV) in any Public Offering (as defined in the Indenture dated as of August 9, 2002 between HSBC Bank USA, as
Trustee, the Company and the Guarantors party thereto relating to those certain Class A Senior Subordinated Notes due 2009, as in effect on the date hereof) generating gross proceeds of at
least $25.0 million, the Exercise Price to be in effect after such issuance or sale shall be determined by multiplying the Exercise Price in effect immediately prior to such issuance or sale by
a fraction, the numerator of which shall be the sum of (x) the number of Common Shares outstanding immediately prior to the time of such issuance or sale multiplied by the Current Market Price
Per Common Share immediately prior to such issuance or sale and (y) the aggregate consideration, if any, to be received by the Company upon such issuance or sale, and the denominator of which
shall be the product of the aggregate number of Common Shares outstanding immediately after such issuance or sale and the Current Market Price Per Common Share immediately prior to such issuance or
sale but in no event will such fraction exceed 1.
In case any portion of the consideration to be received by the Company shall be in a form other than cash, the fair market value of such noncash consideration shall be utilized in the foregoing
computation. Such fair market value shall be determined by the Board of Directors of the Company; PROVIDED that if the Principal Holders shall object to any such determination, the Board of Directors
shall retain an independent appraiser reasonably satisfactory to the Principal Holders to determine such fair market value. The Holders shall be notified promptly of any consideration other than cash
to be received by the Company and furnished with a description of the consideration and the fair market value thereof, as determined by the Board of Directors. 

        (3)   In
case the Company shall fix a record date for the issuance of rights, options or warrants to the holders of its Common Shares or other securities entitling such
holders to subscribe for or purchase for a period expiring within 60 days of such record date Common Shares (or securities convertible into Common Shares) at a price per Common Share (or having
a conversion price per share of Common Share, if a security convertible into Common Shares) less than the Current Market Price Per Common Share on such record date, the maximum number of Common Shares
issuable upon exercise of such rights, options or warrants (or conversion of such convertible securities) shall be deemed to have 

6

 

been
issued and outstanding as of such record date and the Exercise Price shall be adjusted pursuant to paragraph (h)(2) hereof, as though such maximum number of Common Shares had been so
issued for the aggregate consideration payable by the holders of such rights, options, warrants or convertible securities prior to their receipt of such Common Shares. In case any portion of such
consideration shall be in a form other than cash, the fair market value of such noncash consideration shall be determined as set forth in paragraph (h)(2) hereof. Such adjustment shall be made
successively whenever such record date is fixed; and in the event that such rights, options or warrants are not so issued or expire unexercised, or in the event of a change in the number of Common
Shares to which the holders of such rights, options or warrants are entitled (other than pursuant to adjustment provisions therein which are no more favorable in their entirety than those contained in
this paragraph (h)), the Exercise Price shall again be adjusted to be the Exercise Price which would then be in effect if such record date had not been fixed, in the former event, or the
Exercise Price which would then be in effect if such holder had initially been entitled to such changed number of Common Shares, in the latter event. 

        (4)   In
case the Company shall sell or issue rights, options (other than options issued pursuant to a plan described in clause II of paragraph (h)(2)) or
warrants (other than Series B Warrants) entitling the holders thereof to subscribe for or purchase Common Shares (or securities convertible into Common Shares) or shall issue convertible
securities and the price per Common Share of such rights, options, warrants or convertible securities (including, in the case of rights, options, warrants or convertible securities, the price at which
they may be exercised or converted) is less than the Current Market Price Per Common Share, the maximum number of Common Shares issuable upon exercise of such rights, options or warrants or upon
conversion of such convertible securities shall be deemed to have been issued and outstanding as of the date of such sale or issuance, and the Exercise Price shall be adjusted pursuant to
paragraph (h)(2) hereof as though such maximum number of Common Shares had been so issued for an aggregate consideration equal to the aggregate consideration paid for such rights, options,
warrants or convertible securities and the aggregate consideration payable by the holders of such rights, options, warrants or convertible securities prior to their receipt of such Common Shares. In
case any portion of such consideration shall be in a form other than cash, the fair market value of such noncash consideration shall be determined as set forth in paragraph (h)(2) hereof. Such
adjustment shall be
made successively whenever such rights, options, warrants or convertible securities are issued; and in the event that such rights, options or warrants expire unexercised, or in the event of a change
in the number of shares of Common Shares to which the holders of such rights, options, warrants or convertible securities are entitled (other than pursuant to adjustment provisions therein which are
no more favorable in their entirety than those contained in this paragraph (h)), the Exercise Price shall again be adjuted to be the Exercise Price which would then be in effect if such rights,
options, warrants or convertible securities had not been issued, in the former event, or the Exercise Price which would then be in effect if such holders had initially been entitled to 

7

 

such
changed number of Common Shares, in the latter event. No adjustment of the Exercise Price shall be made pursuant to this paragraph (h)(4) to the extent that the Exercise Price shall have
been adjusted pursuant to paragraph (h)(3) upon the setting of any record date relating to such rights, options, warrants or convertible securities and such adjustment fully reflects the number
of Common Shares to which the holders of such rights, options, warrants or convertible securities are entitled and the price payable therefor. 

        (5)   In
case the Company shall fix a record date for the making of a distribution to holders of Common Shares (including any such distribution made in connection with a
consolidation or merger, other than the merger referred to in paragraph (o), in which the Company is the continuing corporation) of evidences of indebtedness, cash, assets or other property
(other than dividends payable in Common Shares or rights, options or warrants referred to in, and for which an adjustment is made pursuant to, paragraphs (h)(3) or (h)(4) hereof), the Exercise Price
to be in effect after such record date shall be determined by multiplying the Exercise Price in effect immediately prior to such record date by a fraction, the numerator of which shall be the Current
Market Price Per Common Share on such record date, less the fair market value (determined as set forth in paragraph (h)(2) hereof) of the portion of the assets, cash, other property or evidence
of indebtedness so to be distributed which is applicable to one Common Share, and the denominator of which shall be such Current Market Price Per Common Share. Such adjustments shall be made
successively whenever such a record date is fixed; and in the event that such distribution is not so made, the Exercise Price shall again be adjusted to be the Exercise Price which would then be in
effect if such record date had not been fixed. 

        (6)   For
the purpose of any computation under paragraph (e) or paragraph (h)(2), (3), (4) or (5) hereof, on any determination date, the Current
Market Price Per Common Share (the "CURRENT MARKET PRICE PER COMMON SHARE") shall be deemed to be the average (weighted by daily trading volume) of the Daily Prices (as defined below) per Common Share
for the 20 consecutive trading days ending three days prior to such date. "DAILY PRICE" means (1) if the Common Shares then are listed and traded on the New York Stock Exchange, Inc.
("NYSE"), the closing price on such day as reported on the NYSE Composite Transactions Tape; (2) if the Common Shares then are not listed and traded on the NYSE, the closing price on such day
as reported by the principal national securities exchange on which the shares are listed and traded; (3) if the Common Shares then are not listed and traded on any such securities exchange, the
last reported sale price on such day on the National Market of the National Association of Securities Dealers, Inc. Automated Quotation System ("NASDAQ"); (4) if the Common Shares then
are not listed and traded on any such securities exchange and not traded on the NASDAQ National Market, the average of the highest reported bid and lowest reported asked price on such day as reported
by NASDAQ; or (5) if such shares are not listed and traded on any such securities
exchange, not traded on the NASDAQ National Market and bid and asked prices are not reported by NASDAQ, then the 

8

 

average
of the closing bid and asked prices, as reported by The Wall Street Journal for the over-the-counter market. If on any determination date the Common Shares are not
quoted by any such organization, the Current Market Price Per Common Share shall be the fair market value of such shares on such determination date as determined by the Board of Directors, without
regard to considerations of the lack of liquidity, applicable regulatory restrictions or any of the transfer restrictions or other obligations imposed on such shares set forth in the Investors'
Agreement. If the Principal Holders shall object to any determination by the Board of Directors of the Current Market Price Per Common Share, the Current Market Price Per Common Share shall be the
fair market value per Common Share as determined by an independent appraiser retained by the Company at its expense and reasonably acceptable to the Principal Holders. For purposes of any computation
under this paragraph (h), the number of Common Shares outstanding at any given time shall not include shares owned or held by or for the account of the Company. 

        (7)   No
adjustment in the Exercise Price shall be required unless such adjustment would require an increase or decrease of at least one percent in such price; PROVIDED that
any adjustments which by reason of this paragraph (h)(7) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this
paragraph (h) shall be made to the nearest one hundredth of a cent or to the nearest hundredth of a share, as the case may be. 

        (8)   In
the event that, at any time as a result of the provisions of this paragraph (h), the holder of this Warrant upon subsequent exercise shall become entitled to
receive any shares of capital stock or other securities of the Company other than Common Shares, the number of such other shares so receivable upon exercise of this Warrant shall thereafter be subject
to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions contained herein. 

        (9)   Upon
each adjustment of the Exercise Price as a result of the calculations made in paragraphs (h)(1), (2), (3), (4) or (5) hereof, the number of shares for
which this Warrant is exercisable immediately prior to the making of such adjustment shall thereafter evidence the right to purchase, at the adjusted Exercise Price, that number of Common Shares
obtained by (i) multiplying the number of shares covered by this Warrant immediately prior to this adjustment of the number of shares by the Exercise Price in effect immediately prior to such
adjustment of the Exercise Price and (ii) dividing the product so obtained by the Exercise Price in effect immediately after such adjustment of the Exercise Price. 

        (10) The
Company shall notify all Holders of the fixing of a record date for the purpose of payment of a cash dividend to holders of Common Shares as soon as reasonably
practicable, but in no event less than 20 days prior to any such record date. 

9

  

        (11) Not
less than 10 nor more than 30 days prior to the record date or effective date, as the case may be, of any action which requires or might require an
adjustment or readjustment pursuant to this paragraph (h), the Company shall forthwith file in the custody of this Secretary or an Assistant Secretary at its principal executive office and with
its stock transfer agent or its warrant agent, if any, an officers' certificate showing the adjusted Exercise Price determined as herein provided, setting forth in reasonable detail the facts
requiring such adjustment and the manner of computing such adjustment. Each such officers' certificate shall be signed by the chairman, president or chief financial officer of the Company and by the
secretary or any assistant secretary of the Company. Each such officers' certificate shall be made available at all reasonable times for inspection by the Holder or any holder of a Warrant executed
and delivered pursuant to paragraph (f) and the Company shall, forthwith after each such adjustment, mail a copy, by first-class mail, of such certificate to the Holder. 

        (12) The
Holder shall, at its option, be entitled to receive, in lieu of the adjustment pursuant to paragraph (h)(5) otherwise required thereof, on the date of
exercise of the Warrants, the evidences of indebtedness, other securities, cash, property or other assets which such Holder would have been entitled to receive if it had exercised its Warrants for
Common Shares immediately prior to the record date with respect to such distribution. The Holder may exercise its option under this paragraph (h)(12) by delivering to the Company a written
notice of such exercise within seven days of its receipt of the certificate of adjustment required pursuant to paragraph (h)(11) to be delivered by the Company in connection with such
distribution. 

        (i)    CONSOLIDATION,
MERGER, OR SALE OF ASSETS. In case of any consolidation of the Company with, or merger of the Company into, any other Person, any merger of another Person
into the Company (other than a merger which does not result in any reclassification, conversion, exchange or cancellation of outstanding Common Shares) or any sale or transfer of all or substantially
all of the assets of the Company or of the Person formed by such consolidation or resulting from such merger or which acquires such assets, as the case may be, the Holder shall have the right
thereafter to exercise this Warrant for the kind and amount of securities, cash and other property receivable upon such consolidation, merger, sale or transfer by a holder of the number of Common
Shares for which this Warrant may have been exercised immediately prior to such consolidation, merger, sale or transfer, assuming (i) such holder of Common Shares is not a Person with which the
Company consolidated or into which the Company merged or which merged into the Company or to which such sale or transfer was made, as the case may be ("CONSTITUENT PERSON"), or an Affiliate of a
constituent Person and (ii) in the case of a consolidation, merger, sale or transfer which includes an election as to the consideration to be received by the holders, such holder of Common
Shares failed to exercise its rights of election, as to the kind or amount of securities, cash and other property receivable upon such consolidation, merger, sale or transfer (provided that if the
kind or amount of securities, cash and other property receivable upon such consolidation, merger, sale or transfer is not the same for each Common Share held immediately prior to such consolidation,
merger, sale or transfer by a Person other than a constituent Person or an Affiliate thereof and in respect of which such rights of election shall not have been exercised ("NON-ELECTING
SHARE"), then 

10

 

for
the purpose of this paragraph (i) the kind and amount of securities, cash and other property receivable upon such consolidation, merger, sale or transfer for each non-electing
share shall be deemed to be the kind and amount so receivable per share by a plurality of the non-electing shares). Adjustments for events subsequent to the effective date of such a
consolidation, merger and sale of assets shall be as nearly equivalent as may be practicable to the adjustments provided for in this Warrant. In any such event, effective provisions shall be made in
the certificate or articles of incorporation of the resulting or surviving corporation, in any contract of sale, conveyance, lease or transfer, or otherwise so that the provisions set forth herein for
the protection of the rights of the Holder shall thereafter continue to be applicable; and any such resulting or surviving corporation shall expressly assume the obligation to deliver, upon exercise,
such shares of stock, other securities, cash and property. The provisions of this paragraph (i) shall similarly apply to successive consolidations, mergers, sales, leases or transfers.
Notwithstanding the foregoing provisions of this paragraph (i), the treatment of this Warrant in connection with the merger of the Company with and into Merrill Corporation shall be governed by
paragraph (o). 

        (j)    NOTICES.
Any notice, demand or delivery authorized by this Warrant Certificate shall be in writing and shall be given to the Holder or the Company as the case may be, at
its address (or telecopier number) set forth below, or such other address (or telecopier number) as shall have been furnished to the party giving or making such notice, demand or delivery: 

	If to the Company:	Merrill Corporation

One Merrill Circle

St. Paul, Minnesota 55108

Telecopy: (651) 632-4141

Attention: General Counsel
	

If to the Holder:	

To the address of such holder set forth on the signature page hereof.

        Each
such notice, demand or delivery shall be effective (i) if given by telecopy, when such telecopy is transmitted to the telecopy number specified herein and the intended
recipient confirms the receipt of such telecopy or (ii) if given by any other means, when received at the address specified herein. 

11

 

        (k)   RIGHTS
OF THE HOLDER. Prior to the exercise of any Warrant, the Holder shall not, by virtue hereof, be entitled to any rights of a shareholder of the Company, including,
without limitation, the right to vote, to receive dividends or other distributions or to receive any notice of meetings of shareholders or any notice of any proceedings of the Company except as may be
specifically provided for herein. 

        (l)    REGISTRATION
RIGHTS. The Holder of this Warrant is entitled to the registration rights relating to the Warrants and the Warrant Shares set forth in the Investors'
Agreement. 

        (m)  GOVERNING
LAW. THIS WARRANT CERTIFICATE AND ALL RIGHTS ARISING HEREUNDER SHALL BE CONSTRUED AND DETERMINED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS AND THE PERFORMANCE THEREOF SHALL BE GOVERNED AND ENFORCED IN ACCORDANCE WITH SUCH LAWS. 

        (n)   AMENDMENTS;
WAIVERS. Any provision of this Warrant Certificate may be amended or waived if, and only if, such amendment or waiver is in writing and signed, in the case
of an amendment, by the Holder and the Company, or in the case of a waiver, by the party against whom the waiver is to be effective. No failure or delay by either party in exercising any right, power
or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law. 

12

        IN
WITNESS WHEREOF, the Company has duly caused this Warrant Certificate to be signed by its duly authorized officer and to be dated as of
                        . 

	 	 	MERRILL CORPORATION
	

 	
 	

By:	

 
	 	 	 	
 Name:

Title:

	Acknowledged and Agreed:	 
	

[HOLDER]	

 
	

By:	

 	

 
	 	
 Name:

Title:	 
	

 	

[Address]	

 
	 	 	 

 
 

WARRANT SUBSCRIPTION FORM    

	To:
	Merrill
Corporation 

        The
undersigned irrevocably exercises the Warrant for the purchase of                          Common Shares (the "SHARES"),
par value $0.01 per share, of Merrill
Corporation (the "COMPANY") at $             per Share (the Exercise Price currently in effect pursuant to the Warrant) and herewith makes payment of
$             (such payment being made in cash or by certified or official bank or bank cashier's check payable to the order of the Company or by any permitted
combination of such cash or check), all on the terms and conditions specified in the within Warrant Certificate, surrenders this Warrant Certificate and all right, title and interest therein to the
Company and directs that the Shares deliverable upon the exercise of this Warrant be registered or placed in the name and at the address specified below and delivered thereto. 

-OR-

        The
undersigned irrevocably exercises the Warrant for the purchase of                          Common Shares (the "SHARES"),
par value $0.01 per share, of Merrill
Corporation (the "COMPANY") at $             per Share (the Exercise Price currently in effect pursuant to the Warrant) (provided that in lieu of payment of
$            , the undersigned will receive a number of Shares reduced by a number of Common Shares having an aggregate Fair Market Value (as defined in the Warrant)
equal to the aggregate Exercise Price for the Shares), all on the terms and conditions specified in the within Warrant Certificate, surrenders this Warrant Certificate and all right, title and
interest therein to the Company and directs that the Shares deliverable upon the exercise of this Warrant be registered or placed in the name and at the address specified below and delivered thereto. 

-OR-

        The
undersigned irrevocably exercises the Warrant for the purchase of                          Common Shares (the "SHARES"),
par value $0.01 per share, of Merrill
Corporation (the "COMPANY") at $             per Share (the
Exercise Price currently in effect pursuant to the Warrant), and herewith makes payment of $             of the aggregate Exercise Price for the Shares in cash,
certified or official bank or bank cashier's check (or a combination of cash and check), and herewith delivers as payment of $             of the aggregate Exercise
Price that number of Common Shares having an aggregate Fair Market Value (as defined in the Warrant) equal to such non-cash portion of the aggregate Exercise Price for the Shares, all on
the terms and conditions specified in the within Warrant Certificate, surrenders this Warrant Certificate and all right, title and interest therein to the Company and directs that the Shares
deliverable upon the exercise of this Warrant be registered or placed in the name and at the address specified below and delivered thereto. 

-OR-

        The
undersigned irrevocably exercises the Warrant for the purchase of                          Common Shares (the "SHARES"),
par value $0.01 per share, of Merrill
Corporation (the "COMPANY") at $             per share (the Exercise Price currently in effect pursuant to the Warrant), and herewith 

 

makes
payment of $             of the aggregate Exercise Price for the Shares in cash, certified or official bank or bank cashier's check (or a combination of cash and
check), and herewith delivers as payment of $             of the aggregate Exercise Price that number of Warrants which, if exercised, would result in a number of
Common Shares having an aggregate Fair Market Value (as defined in the Warrant) equal to such non-cash portion of the aggregate Exercise Price for the Shares, all on the terms and
conditions specified in the within Warrant Certificate, surrenders this Warrant Certificate and all right, title and interest therein to the Company and directs that the Shares deliverable upon the
exercise of this Warrant be registered or placed in the name and at the address specified below and delivered thereto. 

        Date:
                        ,             . 

	 	 	
 (Signature of Owner)
	

 	
 	

 (Street Address)
	

 	
 	

 (City) (State) (Zip Code)

2

 

Securities
and/or check to be issued to: 

Please
insert social security or identifying number: 

Name:

Street
Address: 

City,
State and Zip Code: 

Any
unexercised portion of the Warrant evidenced by the within Warrant Certificate to be issued to: 

Please
insert social security or identifying number: 

Name: 

Street
Address: 

City,
State and Zip Code: 

3

 
 

WARRANT ASSIGNMENT FORM    

	 	 	Dated	 	 
	 	 	 	 	

	FOR VALUE RECEIVED,	 	 	 	 	 	 
	 	 	

	

hereby sells, assigns and transfers unto,
	

 	
 	

 	
 	

 	
 	

(the "ASSIGNEE"),
	
 (please type or print in block letters)	 	 
	

 (insert address)

its
right to purchase up to              Common Shares represented by this Warrant and does hereby irrevocably constitute and appoint
                                         
        Attorney, to transfer the same on the books of the Company, with full power of substitution in the premises. 

	 	 	Signature	 
	 	 	 	

QuickLinks

Exhibit 10.27

PREFERRED STOCKHOLDERS AGREEMENT

EXHIBIT A

AMENDED AND RESTATED CERTIFICATE OF DESIGNATION

EXHIBIT B

MERRILL CORPORATION FORM OF WARRANT FOR THE PURCHASE OF CLASS B COMMON STOCK OF MERRILL CORPORATION

WARRANT SUBSCRIPTION FORM

WARRANT ASSIGNMENT FORM

EXHIBIT C

MERRILL CORPORATION FORM OF WARRANT FOR THE PURCHASE OF CLASS B COMMON STOCK OF MERRILL CORPORATION

WARRANT SUBSCRIPTION FORM

WARRANT ASSIGNMENT FORM

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