Exhibit 10
R. R. DONNELLEY & SONS COMPANY
1993 STOCK PURCHASE PLAN FOR SELECTED MANAGERS AND KEY STAFF EMPLOYEES
(AS AMENDED ON SEPTEMBER 22, 1994)
1. Purpose.
The purpose of the Stock Purchase Plan (the "Plan") of R. R. Donnelley &
Sons Company (the "Company") is to align the interests of the Company's
stockholders and selected managers and key staff employees of the Company and
its majority-owned subsidiaries eligible to participate in the Plan by granting
incentives to such managers and key staff employees to increase their
proprietary interest in the Company's growth and success.
2. Administration.
The Plan will be administered by a Committee (the "Committee") of three or
more directors designated by the Board of Directors of the Company (the "Board).
No member of the Committee, during the one year prior to service on the
Committee or during service on the Committee, shall have been or be granted or
awarded shares of common stock, par value $1.25 per share, of the Company
("Common Stock"), options to purchase shares of Common Stock or other equity
securities of the Company pursuant to the Plan or any other plan of the Company
or any affiliate of the Company, except for any grant or award which would not
result in such member ceasing to be a "disinterested person" within the meaning
of Rule 16b-3 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). The Committee may adopt such rules and regulations and make
such determinations and interpretations and provide for all terms and conditions
of the Plan and participation thereunder as it shall deem desirable and not
inconsistent with the limitations herein provided. All such rules, regulations,
determinations and interpretations relating to the Plan adopted by the Committee
shall be conclusive and binding upon all parties.
3. Eligibility.
(a) The Committee shall determine the classes (or portions thereof) of
managers and key staff employees of the Company and any of its subsidiaries that
are eligible to participate in the Plan (each such class determined to be so
eligible being referred to herein as an "Eligible Class"); provided that the
Committee may direct that the determination of such classes (or portions
thereof) be made by the Chief Executive Officer, either alone or together with
one or more designated officers of the Company, except that the determination of
the eligibility of any class in which there is an "officer" within the meaning
of Rule 16a-1 under the Exchange Act shall be made by the Committee. The
determination of Eligible Classes shall remain in effect unless and until
changed in accordance with the following. No elimination of an Eligible Class
or portion thereof may be made with respect to any calendar year after February
1 of such year. Additions of Eligible Classes or portions thereof may be made
at any time by the Committee, or by the Chief Executive Officer, either alone or
together with one or more designated officers of the Company, if the Committee
has delegated the authority to determine such Eligible Classes to the Chief
Executive Officer.
(b) An employee of the Company or a subsidiary of the Company who either
(i) is employed in an Eligible Class on a Purchase Date (as hereinafter
defined), or (ii) was employed in an Eligible Class on the December 31 next
preceding a Purchase Date and who retired at age 55 or over on or after such
December 31 and on or prior to such Purchase Date, shall be eligible to purchase
shares of Common Stock in accordance with the Plan on such Purchase Date (each
such employee being referred to herein as an "Eligible Employee"); provided that
any Eligible Employee who disposes of Common Stock purchased under the Plan in
contravention of Section 7 hereof shall not be an Eligible Employee (and
therefore not entitled to purchase shares of Common Stock under the Plan) on
either of the two Purchase Dates next following the date on which the Company
becomes aware of the most recent such disposition and with respect to which the
condition set forth in Section 4(c) is satisfied.
4. Eligible Employee's and Company's Contributions for Purchase of Shares of
Common Stock.
(a) Subject to subsection (c) below, each Eligible Employee may, with
respect to each Purchase Date, contribute up to 5% of the Compensation (as
hereinafter defined) of such Eligible Employee for the calendar year next
preceding such Purchase Date; provided that the amount, if any, contributed by
an Eligible Employee (the "Eligible Employee's Contribution Amount") shall in no
event be less than $100. The Eligible Employee's Contribution Amount shall,
subject to the conditions contained herein, be applied, together with a Company
contribution equal to 50% of the Eligible Employee's Contribution Amount, to the
purchase of Common Stock as provided in Section 5. The Company will contribute
an additional amount equal to 20% of the Eligible Employee's Contribution
Amount, which amount will be paid in cash to the Eligible Employee in the last
pay period in the month of April next following the Purchase Date.
(b) The election of an Eligible Employee to contribute with respect to a
Purchase Date and the designation by such Eligible Employee of such Eligible
Employee's Contribution Amount for such Purchase Date must be made no later than
the March 15 next preceding such Purchase Date; provided that in the case of an
Eligible Employee who is subject to Section 16 of the Exchange Act, such
election and designation with respect to a Purchase Date shall be made no later
than the September 15 next preceding such Purchase Date and shall be irrevocable
after such September 15. An Eligible Employee shall pay such Eligible
Employee's Contribution Amount in full on or before the March 15 next preceding
a Purchase Date.
(c) No Eligible Employee may make a contribution under the Plan following
any calendar year of the Company, unless the consolidated net earnings of the
Company for such year, before provision for Federal, state and other income
taxes, shall equal or exceed 8% of the consolidated net sales of the Company, as
determined in accordance with generally accepted accounting principles as in
effect for such year (the "Performance Threshold"); provided, however, that the
Committee may, in its sole discretion exercised at any time, exclude from the
calculation of the Performance Threshold for any year the effect of any
extraordinary, non-recurring or unusual charge or credit, any change in
accounting policy or any other factors (including, without limitation,
acquisitions or dispositions) deemed by the Committee to warrant such exclusion
or change the Performance Threshold as it deems appropriate.
(d) The "Compensation" of an Eligible Employee for a calendar year shall
mean the sum of (i) the base pay (before reduction on account of any election by
the Eligible Employee pursuant to a "qualified cash or deferred arrangement," as
defined in Section 401(k) of the Internal Revenue Code of 1986 (the "Code")), or
pursuant to a "cafeteria plan," as defined in Section 125 of the Code), and
overtime paid to such Eligible Employee by the Company and its subsidiaries
during such calendar year and (ii) the annual incentive compensation amount paid
to such Eligible Employee by the Company and its subsidiaries during such
calendar year, prorated, if necessary, for the portion of such calendar year
during which such employee was in an Eligible Class. Notwithstanding the
foregoing, Compensation shall not include expatriate benefits paid under the
Company's expatriate policy (as amended from time to time), including, without
limitation, any foreign service or hardship premium.
5. Purchase of Shares of Common Stock.
The Eligible Employee's Contribution Amount and the Company contribution
equal to 50% of such Eligible Employee's Contribution Amount shall be applied on
the first trading day following March 15 in any year when purchases may be made
(a "Purchase Date") to the purchase from the Company of whole shares of Common
Stock for the Eligible Employee's account at the average of the high and low
transaction prices reported in the New York Stock Exchange Composite
Transactions report for such Purchase Date. Any amount in excess of the amount
so applied to the purchase of whole shares of Common Stock shall be paid to the
Eligible Employee.
6. Certificates Representing Shares of Common Stock.
Shares purchased under the Plan for the account of an Eligible Employee
will be represented by a certificate registered in the name of such Eligible
Employee or, if such Eligible Employee shall so specify, in the name of such
Eligible Employee and such Eligible Employee's spouse as joint tenants, and the
certificate shall be delivered to the Eligible Employee as soon as practicable
following the Purchase Date.
7. Disposition of Shares of Common Stock.
An Eligible Employee who purchases shares of Common Stock under the Plan
may sell, assign, transfer or otherwise dispose of such shares at any time;
provided that the sale, assignment, transfer or other disposition of any shares
of Common Stock which are purchased under the Plan within three years of the
date of purchase of such shares under the Plan (other than a transfer into the
name of the Eligible Employee and such employee's spouse as joint tenants or a
transfer from joint tenancy into the name of the Eligible Employee individually)
shall automatically terminate the right of such Eligible Employee to participate
in the Plan on the two Purchase Dates next following the date on which the
Company becomes aware of the most recent such disposition and with respect to
which the condition set forth in Section 4(c) is satisfied. An Eligible
Employee who transfers shares to a trust or brokerage account may
restore such Eligible Employee's right to participate in the Plan by re-
registering such shares in such Eligible Employee's name (or registering such
shares in joint tenancy with such Eligible Employee's spouse) within three
months of notice from the Company and delivering a copy of the certificate
representing such re-registered shares to the Compensation and Employee Benefits
department of the Company.
8. Number of Shares of Common Stock.
The maximum number of shares of Common Stock available for purchase under
the Plan shall be 7,000,000 shares of Common Stock; provided that such maximum
number shall be proportionately adjusted for any increase or decrease in the
number of issued shares of Common Stock resulting from a split-up or
consolidation of shares or like capital adjustment or the payment of any stock
dividend or other increase or decrease in the number of such issued shares
effected without receipt of consideration by the Company. Shares of Common
Stock purchased under the Plan shall, at the election of the Company, be
authorized and unissued shares of Common Stock or shares of Common Stock held as
treasury shares or a combination thereof.
9. Effective Date.
The Plan shall be submitted to the stockholders of the Company for approval
at the 1993 annual meeting of stockholders and, if approved, shall become
effective as of January 1, 1993.
10. Termination and Amendment.
The Plan shall terminate with respect to Compensation paid to employees
after December 31, 2002 unless terminated earlier by the Board. The Board may
suspend the Plan at any time. Any termination or suspension shall not affect
the rights of an Eligible Employee with respect to shares of Common Stock
theretofore purchased under the Plan. The Board may amend the Plan at any time,
but no amendment may be made without the approval of stockholders if such
amendment would increase the Company's total contribution to a percent greater
than 70% of an Eligible Employee's Contribution Amount, increase the maximum
percentage to more than 5% of an Eligible Employee's Compensation, reduce the
purchase price of shares of Common Stock under the Plan, or increase the
aggregate number of shares of Common Stock which may be purchased under the
Plan.