LETTER FROM OUR LEAD DIRECTOR

DEAR FELLOW STOCKHOLDERS,

Thank you for your investment in LSC Communications and for trusting the Board of Directors to oversee your interests in our business. Our Board understands that it is elected by you, the stockholders, to oversee the long-term health and overall success of our Company.

It has been my privilege to serve as LSC’s Lead Director this year, working with a group of highly-engaged and knowledgeable directors who are strongly attuned to their roles as your fiduciaries. I would like to reflect on 2017, our first full year as a public company, and the many ways in which our Board worked together to provide independent oversight of management and represent your interests throughout the year.

Independent Board Oversight

Our Board is composed of fully independent directors, with the exception of Tom Quinlan, our Chairman and Chief Executive Officer. The skills each of our directors bring to the Board reflect the deep expertise essential to effective oversight of our business, including operational leadership, governance, strategy and extensive experience in finance, sales, marketing and information technology.

In 2017, our directors utilized their deep knowledge and diverse backgrounds to work with management in its oversight of the Company’s corporate strategy. Additionally, we reviewed specific business and organizational initiatives, capital allocation priorities and business development opportunities. We continued our efforts to take the pulse of our Company by inviting our business leaders to participate in Board meetings throughout the year. With visits to our facilities and employees in Las Vegas, Nevada, Spartanburg, South Carolina and Bolingbrook, Illinois we were committed to asking the tough questions. In addition, our Board and its committees were involved in overseeing enterprise risk management, including risk priorities and developments that could impact our business and we also looked to the future by our ongoing review of director and management succession planning.

On top of our focus on the financial and operational performance of the Company, our Board also oversees other important Company initiatives and functions, including our safety, sustainability and ethics programs, in order to ensure that our Company’s culture aligns with our strategy and operates in the best interest of our stockholders.

Independent Board Leadership

As Lead Director, I work closely with our Chairman and Chief Executive Officer and other members of management to ensure that an active dialogue exists between our independent directors and management. In addition, in my role as Lead Director, I contribute to the development of, and approval of, Board meeting schedules, agendas, and materials. I attend each Board and Board committee meeting and also preside over the executive sessions of the Board held with our independent directors. Further, I am responsible, along with the Chairman of our Human Resources Committee, for leading the independent directors’ evaluation of the effectiveness of our Chief Executive Officer.

Good Governance Practices

As directors, we remain accountable to you through a variety of governance practices that are informed by our ongoing engagement with our stockholders. The Corporate Responsibility & Governance Committee of the Board, consisting of independent directors, oversees our annual multi-step self-evaluation process, which provides directors an opportunity to assess the Board, the Board committees and each individual director. Whereas our independent directors serving on the Human Resources Committee establish and monitor the Company’s overall executive compensation strategy to ensure that executive officer compensation supports the Company’s business objectives. Please see theCompany Information — Corporate Governance andCompensation Discussion & Analysis sections of this proxy statement for more details on these and other governance highlights.

Our Board remains committed to serving your interests in 2018 and thanks you for your continued engagement and support of our Company.

Sincerely,

Judith H. Hamilton

Lead Director

April 10, 2018

LSC COMMUNICATIONS, INC.

NOTICE OF 20172018 ANNUAL MEETING OF STOCKHOLDERS

You will find more information on the matters for voting in the proxy statement on the following pages. If you are a stockholder of record, you may vote by mail, by toll-free telephone number, by using the Internet or in person at the annual meeting.

Your vote is important! We strongly encourage you to exercise your right to vote as a stockholder. You will find instructions on how to vote beginning on page 7. Please sign, datevote, by signing, dating and returnreturning the enclosed proxy card or voting instruction card in the envelope provided, callcalling the toll-free number or loglogging on to the Internetinternet — even if you plan to attend the annual meeting. You may revoke your proxy at any time before it is exercised.

You will find instructions on how to vote beginning on page 13. Most stockholders vote by proxy and do not attend the annual meeting in person. However, as long as you were a stockholder at the close of business on March 30, 2017,29, 2018, you are invited to attend the annual meeting, or to send a representative. Please note that only persons with an admission ticket or evidence of stock ownership or who are guests of the Company will be admitted to the annual meeting.

By Order of the Board of Directors

Suzanne S. Bettman

Secretary

April 11, 201710, 2018

TABLE OF CONTENTS

TABLE OF CONTENTS

2018 Proxy Statement | LSC COMMUNICATIONS, INC

TABLE OF CONTENTS

2017 Proxy Statement | LSC COMMUNICATIONS, INC.INC | 2018 Proxy Statement

PROXY SUMMARY

PROXY SUMMARY

This summary highlights certain information from our proxy statement for the 20172018 Annual Meeting of Stockholders. You should read the entire proxy statement carefully before voting.

20172018 ANNUAL MEETING INFORMATION

For additional information about voting, seeQuestions and Answers About How to Vote Your ProxyProxy..

MATTERS TO BE VOTED ON AT OUR 20172018 ANNUAL MEETING

Summary of the SeparationCompany Background

On October 1, 2016, R.R.R. R. Donnelley & Sons Company (“RR Donnelley” or “RRD”) effected its previously-announced intention to separate into three independent public companies: Donnelley Financial Solutions, Inc. (“Donnelley Financial” or “DFS”), LSC Communications, Inc. (“LSC,” “LSC Communications,” “we,” “our,” “us” and the “Company”) and RR Donnelley. The separation (the “Separation”) was effected when RRD distributed on a pro rata basis to holders of its common stock at least 80% of the outstanding shares of LSC common stock (the “Distribution”). SeeCertain Relationships and Related Party Transactions for more information regarding Separation-related agreements.

LSC Communications Our common stock is a public company traded on the New York Stock Exchange (the “NYSE”) under the trading symbol “LKSD.”

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PROPOSALS

PROPOSALS

PROPOSAL 1: ELECTION OF DIRECTORS

Our Certificate of Incorporation provides for a classified board consisting of three classes of directors. Class I directors served until the first annual meeting of stockholders following the Separation (which was held on May 18, 2017), and our stockholders elected their successor directors to one-year terms until the 2018 Annual Meeting of Stockholders. Class II directors serve until the firstsecond annual meeting of stockholders following the Separation (which will be held on May 18, 2017). Class II17, 2018), and our stockholders will elect their successor directors andto one-year terms at the 2018 Annual Meeting of Stockholders. Class III directors, which together with Class I directors and Class II directors are referred to as the “Initial Directors,” serve until the second or the third annual meetingsmeeting of stockholders following the Separation, respectively.which will be held in May 2019. Following the expiration of the Class III directors’ initial terms of the Initial Directors,three-year term, our stockholders will elect their successor directors toone-year terms. Our Certificate of Incorporation provides that our Board of Directors (the “Board”) fully declassifies upon the expiration of the terms of our Class III directors.

OurBy-laws provide that directors are elected to the Board by a majority of the votes cast, except in contested elections, wherein directors are elected to the Board by a plurality of the votes cast.

In the event that an incumbent director is not reelected, the Company’sPrinciples of Corporate Governance require that director to promptly tender his or her resignation. The Board will accept this resignation unless it determines that the best interests of the Company and its stockholders would not be best served by doing so.

If any nominee does not stand for election, proxies voting for that nominee may be voted for a substitute nominee selected by the Board. The Board may also choose to reduce the number of directors to be elected at the annual meeting.

In 2017 the Board met ten times. Each director of the Company during 2017 attended at least 75% of the total number of meetings of the Board and those committees of which the director was a member during the period he or she served as a director.

The names of the nominees, along with their present positions, their principal occupations,career highlights, current directorships held with other public companies, as well as public directorships during the past five years, other affiliations, their ages and the year first elected as a director, are set forth below. Certain individual qualifications, experiences and skills of our directors that contribute to the Board’s effectiveness as a whole are also described below.

In 2016 following the Separation, the Board met three times. Each director of the Company during 2016 attended at least 75% of that total number of meetings of the Board and those committees of which the director was a member during the period he or she served as a director.

DIRECTORS OF CLASS I – TERMS EXPIRE MAY 2017

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PROPOSAL 2: ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION

As required by Section 14A of the Securities Exchange Act of 1934 (the “Exchange Act”), the Company is presenting a proposal that gives stockholders the opportunity to cast an advisory(non-binding) vote on our executive compensation for named executive officers described in this proxy statement by voting for or against it. The advisory vote on executive compensation described in this proposal is commonly referred to as aSay-on-Pay Say on Pay vote.

As disclosed in theCompensation Discussion and & Analysis section of this proxy statement (the “CD&A”), we believe the 2016our 2017 executive compensation program was designed to strike an appropriate balance between aligning stockholder interests, rewarding executives for strong performance, ensuring the Company’s long-term success and retaining key executive talent. The information presented in the compensation tables beginning on page 41in theExecutive Compensation section of this proxy statement relates to the 2016Company’s 2017 fiscal year, which ended on December 31, 2016. The beginning section of the CD&A focuses on RRD’s compensation programs and decisions prior to the Separation (when LSC was part of RRD) and the later sections, on LSC’s compensation program and decisions following the Separation. Thepre-Separation compensation information may not in all cases be directly relevant to the compensation that our executive officers will receive in future years, following the Separation. Following the2017.

LSC Compensation Philosophy

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PROPOSALS

Separation, theThe Human Resources Committee of the Board (the “HR Committee” or “LSC HR Committee”) determined the executive compensation strategy which is described below.

Post-Separation, the LSC HR Committeehas adopted the following compensation philosophy (the “LSC Compensation Philosophy”) to guide its compensation decisions:

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Consistent with its compensation philosophy, LSC has adopted the following compensation best practices:2017 Executive Compensation Program Highlights

The LSC HR Committee determined that it was important in connection with the Separation to grant to a limited group of executives, which included the NEOs, a one-time, non-recurring “Founders’ Award” to provide incentive for the long-term retention of the executives, align such executives’ interests with new stockholder interests, and allow participants to share in post-Separation gains in LSC value. These Founders’ Awards were in the form of restricted stock awards and were granted on the date of the Separation by the new LSC HR Committee. Among other considerations, to ensure consistency with the Company’s compensation philosophy, the LSC HR Committee reviewed the following factors in determining the Founders’ Awards: competitive practices relative to other corporate spin-off companies; market data on the size of the awards as a range of percentage of salary; and the roles and positions of each participant. The LSC HR Committee also determined

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at the time of the grant of the Founders’ Awards that, in consideration of his Founders’ Award, the CEO would not be eligible for a grant under the long-term incentive program in 2017. SeeCompensation Discussion & Analysis — LSC Post-Separation Compensation Decisions — Long-Term Incentive Program beginning on page 37 for additional information.

This proposalProposal 2 gives our stockholders the opportunity to express their views on the overall compensation of our named executive officers and the philosophy, policies and practices described in this proxy statement. For the reasons discussed above, we are asking our stockholders to indicate their support for our named executive officer compensation by votingFOR the following resolution at the 20172018 Annual Meeting of Stockholders:

“RESOLVED: that the Company’s stockholders approve, on an advisory basis, the compensation of the named executive officers, as disclosed in the Company’s proxy statement for its 20172018 Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including theCompensation Discussion and & Analysis, the 2017Summary Compensation Table and the other related tables and disclosures in this proxy statement.”

TheSay-on-Pay Say on Pay vote is an advisory vote only, and therefore it will not bind the Company or our Board.Board (including the HR Committee). However, the Board and the LSC HR Committee will consider the voting results when making future decisions regarding executive compensation, as appropriate.

The affirmative vote of the holders of a majority of the shares of the Company’s common stock present in person or by proxy at the 20172018 Annual Meeting of Stockholders and entitled to vote on the advisory vote on executive compensation is required to approve the proposal.

PROPOSAL 3: ADVISORY VOTE ON THE FREQUENCY OF ADVISORY VOTE ON EXECUTIVE COMPENSATION

Pursuant to Section 14A of the Exchange Act, the Company is presenting a proposal that gives stockholders the opportunity to cast an advisory(non-binding) vote on their preferences as to the frequency of futureSay-on-Pay votes: every one, two, or three years. Stockholders also may, if they wish, abstain from voting on this proposal.

After careful consideration of this proposal, our Board has determined that it is appropriate and in the best interests of the Company to solicit aSay-on-Pay vote every year for a number of reasons, including the following:

Stockholders are not voting to approve or disapprove the Board’s recommendation. Instead, the proxy card provides stockholders with four choices with respect to this proposal: every one, two or three years, or stockholders may abstain from voting on this proposal.

The vote is an advisory vote only and therefore it will not bind the Company or our Board. However, the Board and the LSC HR Committee will consider the voting results when adopting a policy on the frequency of futureSay-on-Pay votes, as appropriate.

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PROPOSALS

PROPOSAL 4: APPROVAL OF THE AMENDED AND RESTATED 2016 PERFORMANCE INCENTIVE PLAN

The Board has approved and recommends that our stockholders approve, an Amended and Restated LSC Communications, Inc. 2016 Performance Incentive Plan (the “Amended 2016 PIP”). The Amended 2016 PIP is substantially similar to the LSC Communications, Inc. 2016 Performance Incentive Plan (the “2016 PIP”), which was approved by our Board and our former parent, RRD (in its capacity as the sole stockholder of the Company at that time) on September 30, 2016.

The Amended 2016 PIP will:

If approved, the Amended 2016 PIP will become effective as of the date of the Annual Meeting (the “Effective Date”) and apply to all awards made on or after the Effective Date. We believe approval of the Amended 2016 PIP is advisable to ensure the Company may continue to grant equity-based awards as part of its compensation programs and to reflect current best practices for stock incentive plans.

A total of 3.5 million shares of our common stock, par value $0.01 per share, were previously reserved for awards under the 2016 PIP. As of March 30, 2017, approximately 1.8 million shares of common stock remained available for the future grant of awards under the 2016 PIP.

If stockholders do not approve the Amended 2016 PIP, then

Failure to approve the Amended 2016 PIP will not affect the rights of existing awards or award holders under the 2016 PIP.

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Background and Purposes of the Amended 2016 PIP

The Board believes that amending certain provisions of the 2016 PIP to remain consistent with market practices will allow us to attract, motivate, reward and retain the broad-based talent critical to achieving our business goals. Stock ownership by employees and directors provides performance incentives and fosters a long-term commitment to our benefit and to the benefit of our stockholders, offers additional incentives to put forth maximum effort for the success of our business, and affords them an opportunity to acquire a proprietary interest in the Company.

Furthermore, approval of the Amended 2016 PIP will also serve to approve the material terms of the performance goals for purposes of Section 162(m) of the Internal Revenue Code (the “Code”). If the Amended 2016 PIP and performance goals are approved, the effectiveness of the approval will last until 2022 for Section 162(m) purposes. If the Amended 2016 PIP is not approved, then Section 162(m) provides that the Company may be unable to obtain tax deductions for certain compensation expenses associated with awards granted under the Amended 2016 PIP to certain of our executive officers for awards granted following the Company’s 2018 Annual Meeting. While the Board reserves the right to grant compensation that is not tax deductible, the Board believes it is in the Company’s best interest to be in a position to do so and, therefore, recommends that the stockholders vote to approve the Amended 2016 PIP.

The Amended 2016 PIP is intended to provide incentives:

Summary Description of the Amended 2016 PIP

Under the Amended 2016 PIP, the Company may grant stock options, including incentive stock options, stock appreciation rights (“SARs”), restricted stock, stock units and cash awards, as discussed in greater detail below. The following description of the Amended 2016 PIP is a summary and is qualified in its entirety by reference to the complete text of the Amended 2016 PIP, which is attached as Appendix A to this proxy statement.

Participants

Non-employee directors (who will number eight following the Annual Meeting), employees (approximately 22,000) and other individuals who provide services to the Company are eligible to participate in the Amended 2016 PIP.

Administration

The Amended 2016 PIP will be generally administered by a committee designated by the Board (the “Plan Committee”), but the Board may, in its discretion, administer the Amended 2016 PIP or grant awards. Each member of the Plan Committee is a director that the Board has determined to be an “outside director” under Section 162(m) of the Code, a“non-employee director” under Section 16 of the Exchange Act and “independent” for purposes of the NYSE listing rules.

The Plan Committee may select eligible participants and determine the terms and conditions of each grant and award. All awards, except those subject to performance-based vesting conditions over a performance period of at least one year or those tonon-employee directors, shall have a minimum vesting period of at least three years from the date of grant (such vesting may occur in full at the end of, or in installments over, the three-year period). Up to 5% of the shares available for grant may be granted with a minimum vesting period of less than three years, and the Plan Committee may provide for early vesting upon the death, permanent or total disability, retirement or termination of service of the award recipient. “Double trigger” vesting shall occur with acceleration upon a Change in Control (as defined in the Amended 2016 PIP) and the grantee’s termination without Cause or for Good Reason (each as defined in the applicable award agreement).

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PROPOSALS

Each grant and award will be evidenced by an award agreement approved by the Plan Committee. The Plan Committee generally cannot reprice any stock option or other award granted under the Amended 2016 PIP. Except with respect to grants to (i) officers of the Company who are subject to Section 16 of the Exchange Act, (ii) a person whose compensation is likely to be subject to the $1 million deduction limit under Section 162(m) of the Code (described below under—U.S. Federal Income Tax Consequences) or (iii) persons who are not employees of the Company, the Plan Committee may delegate some or all of its power and authority to administer the Amended 2016 PIP to the chief executive officer or other executive officer of the Company.

Available Shares

As of March 30, 2017, approximately 1.8 million shares of Company common stock (which are currently available under, and will be carried over from, the 2016 PIP) will be available under the Amended 2016 PIP for grants and awards to eligible participants, subject to adjustment in the event of certain corporate transactions that affect the capitalization of the Company. In general, shares subject to a grant or award under the Amended 2016 PIP which are not issued or delivered would again be available for grant. However, shares tendered or withheld upon exercise, vesting, settlement of an award or upon any other event to pay exercise price or tax withholding and shares purchased by the Company using the proceeds from the exercise of a stock option will not be available for future issuance. Upon exercise of an SAR, the total number of shares remaining available for issuance under the Amended 2016 PIP will be reduced by the gross number of shares for which the SAR is exercised.

Award Limits

The maximum number of shares of common stock with respect to which options, SARs or a combination thereof may be granted during any calendar year to any person is 1,500,000. With respect to performance awards that the Plan Committee desires to be eligible for deduction in excess of the $1,000,000 limit under Section 162(m) of the Code, the maximum compensation payable pursuant to such awards granted during any calendar year cannot exceed (i) 900,000 shares of common stock or (ii) $9,000,000. Nonon-employee director may be granted (in any calendar year) compensation with a value in excess of $900,000, with the value of any equity-based awards based on such award’s accounting grant date value.

Termination and Amendment

Unless previously terminated by the Board, the Amended 2016 PIP will terminate on the date on which no shares remain available for grants or awards. Termination will not affect the rights of any participant under grants or awards made prior to termination. The Board may amend the Amended 2016 PIP at any time, but no amendment may be made without stockholder approval if required by any applicable law, rule or regulation, including Section 162(m) of the Code, if it would increase the number of shares of Company common stock available under the Amended 2016 PIP or permit repricing of awards.

Stock Options and Stock Appreciation Rights

The period for the exercise of anon-qualified stock option (other than options granted tonon-employee directors) or an SAR, and the option exercise price and base price of an SAR, will be determined by the Plan Committee. The option exercise price and the base price of an SAR will not be less than the fair market value of a share of Company common stock on the date of grant, and the minimum vesting period must be at least three years. The exercise of an SAR entitles the holder to receive (subject to withholding taxes) shares of Company common stock, cash or both with a value equal to the excess of the fair market value of a stated number of shares of Company common stock over the SAR base price.

Stock options and SARs must be exercised within ten years of the date of grant, or five years after the date of grant for incentive stock options granted to 10% stockholders. If the recipient of an incentive stock option is a 10% stockholder, the option exercise price will be not less than the price required by the Code, currently 110% of fair market value on the date of grant.

Performance Awards and Fixed Awards

Under the Amended 2016 PIP, bonus awards, whether performance awards or fixed awards, can be made in (i) cash, (ii) stock units, (iii) restricted shares of Company common stock that are forfeitable and have restrictions on transfer or (iv) any combination of the foregoing.

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The performance goals of performance awards must be tied to one or more of the following: net sales; cost of sales; gross profit; earnings from operations; earnings before interest, taxes, depreciation and amortization; earnings before income taxes; earnings before interest and taxes; cash flow measures; return on equity; return on assets; return on net assets employed; return on capital; working capital; leverage ratio; stock price measures; enterprise value; safety measures; net income per common share (basic or diluted); EVA (economic value added); cost reduction goals or, in the case of awards not intended to be “qualified performance-based compensation” within the meaning of Section 162(m) of the Code, any other similar criteria established by the Plan Committee. The Plan Committee may provide in any award agreement that the Plan Committee (i) will amend or adjust the performance goals or other terms or conditions of an outstanding award in recognition of unusual or nonrecurring events and (ii) has the right to reduce the amount payable pursuant to any performance award.

Restricted stock recipients will have the rights of a stockholder, including voting and dividend rights, subject to any restrictions and conditions specified in the award agreement. No dividends, however, will be paid at a time when any performance-based goals that apply to an award of restricted shares have not been satisfied. Upon termination of any applicable restriction period, including the satisfaction or achievement of required performance goals, a certificate evidencing ownership of the shares of the common stock will be delivered to the grantee, subject to the Company’s right to require payment of any taxes.

Recipients of stock units generally will be credited dividends and other distributions otherwise payable and held until the award is paid out. Interest may be credited. The grantee will have only the rights of a general unsecured creditor and no rights as a stockholder of the Company until delivery of the shares, cash or other property underlying the award.

At the time of vesting of a bonus award: (i) the award if in units, will be paid to the participant in shares of Company common stock, in cash or in a combination thereof, (ii) the award if a cash bonus award, will be paid to the participant in cash, in shares of Company common stock or in a combination thereof and (iii) shares of restricted common stock issued pursuant to an award will be released from the restrictions.

Awards toNon-Employee Directors

On the date of each Annual Meeting, the Company will make an award under the Amended 2016 PIP to each individual who is, immediately following such annual meeting, anon-employee director. Any such awards will be in the form of stock options, restricted stock, stock units or SARs with a minimum vesting period of one year from the date of grant.

Transferability

Awards granted under the Amended 2016 PIP may be assigned or transferred in the event of death, subject to certain conditions.

U.S. Federal Income Tax Consequences

The following is a brief summary of some of the U.S. federal income tax consequences generally arising with respect to grants and awards under the Amended 2016 PIP. This summary is not intended to constitute tax advice, is not intended to be exhaustive and, among other things, does not describe state, local or foreign tax consequences. This section is based on the Code, its legislative history, existing and proposed regulations under the Code and published rulings and court decisions, all as in effect as of the date of this proxy statement. These laws are subject to change, possibly on a retroactive basis.

Stock Options

A participant will not recognize any income upon the grant of anon-qualified or incentive stock option. A participant will recognize compensation taxable as ordinary income upon exercise of anon-qualified stock option in an amount equal to the excess of the fair market value of the shares purchased on the date of exercise over their exercise price, and the Company (or one of its subsidiaries) generally will be entitled to a corresponding deduction, except to the extent limited by Section 162(m) of the Code. A participant will not

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PROPOSALS

recognize any income (except for purposes of the alternative minimum tax) upon exercise of an incentive stock option. If the shares acquired by exercise of an incentive stock option are held for the longer of two years from the date the option was granted and one year from the date it was exercised, any gain or loss arising from a subsequent disposition of such shares will be treated as long-term capital gain or loss, and neither the Company nor its subsidiaries will be entitled to any deduction. If, however, such shares are disposed of within such one or two year periods, then in the year of such disposition the participant will recognize compensation taxable as ordinary income equal to the excess of (A) the lesser of either (i) the amount realized upon such disposition or (ii) the fair market value of such shares on the date of exercise, over (B) the exercise price, and the Company or one of its subsidiaries will be entitled to a corresponding deduction. The participant will also be subject to capital gain tax on the excess, if any, of the amount realized on such disposition over the fair market value of the shares on the date of exercise.

SARs

A participant will not recognize any income upon the grant of SARs. A participant will recognize compensation taxable as ordinary income upon exercise of an SAR in an amount equal to the fair market value of any shares delivered and the amount of cash paid by the Company upon such exercise, and the Company or one of its subsidiaries generally will be entitled to a corresponding deduction.

Restricted Stock

A participant will not recognize any income at the time of the grant of shares of restricted stock (unless the participant makes an election to be taxed at the time of grant), and neither the Company nor its subsidiaries will be entitled to a tax deduction at such time. If the participant elects to be taxed at the time the restricted stock is granted, the participant will recognize compensation taxable as ordinary income at the time of the grant equal to the excess of the fair market value of the shares at such time over the amount, if any, paid for such shares. If such election is made, a participant will recognize compensation taxable as ordinary income at the time the forfeiture conditions on the restricted stock lapse in an amount equal to the excess of the fair market value of the shares at such time over the amount, if any, paid for such shares. The Company or one of its subsidiaries generally will be entitled to a corresponding deduction at the time the ordinary income is recognized by a participant, except to the extent limited by Section 162(m) of the Code. In addition, a participant receiving dividends with respect to restricted stock for which the above-described election has not been made and prior to the time the forfeiture conditions lapse will recognize compensation taxable as ordinary income, rather than dividend income, in an amount equal to the dividends paid, and the Company or one of its subsidiaries generally will be entitled to a corresponding deduction, except to the extent limited by Section 162(m) of the Code.

Stock Units

A participant will not recognize any income at the time of the grant of stock units, and neither the Company nor its subsidiaries will be entitled to a tax deduction at such time. A participant will recognize compensation taxable as ordinary income at the time the Company common stock is delivered under the stock units in an amount equal to the fair market value of such shares. The Company or one of its subsidiaries generally will be entitled to a corresponding deduction at the time the ordinary income is recognized by a participant, except to the extent the limit of Section 162(m) of the Code applies. A participant will recognize compensation taxable as ordinary income when amounts equal to dividend equivalents and any other distributions attributable to stock units are paid, and the Company or one of its subsidiaries generally will be entitled to a corresponding deduction, except to the extent limited by Section 162(m) of the Code.

Cash Bonus Awards

A participant will not recognize any income upon the grant of a bonus award payable in cash, and neither the Company nor its subsidiaries will be entitled to a tax deduction at such time. At the time such award is paid, the participant will recognizecompensation taxable as ordinary income in an amount equal to any cash paid by the Company, and the Company or one of its subsidiaries generally will be entitled to a corresponding deduction, except to the extent limited by Section 162(m) of the Code.

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Section 162(m) of the Internal Revenue Code

In general, Section 162(m) denies a publicly held corporation a federal income tax deduction for compensation in excess of $1 million per year per person paid to its “covered employees,” subject to certain exceptions. “Performance-based” compensation is not subject to the $1 million deduction limit. To qualify as performance-based compensation: (i) the compensation must be subject to achievement of performance goals established by a committee consisting solely of two or more “outside directors,” (ii) the material terms under which the compensation is to be paid, including the performance goals, are approved by a majority of the corporation’s stockholders and (iii) the Plan Committee certifies that the applicable performance goals were satisfied before payment of any performance-based compensation is made. The Company reserves the right to pay compensation that is not deductible.

Section 409A

Awards made under the Amended 2016 PIP that are considered to include deferred compensation for purposes of Section 409A of the Code will be interpreted, administered and construed to comply with the requirements of Section 409A to avoid adverse tax consequences to recipients. The Company intends to structure any awards under the Amended 2016 PIP so that the requirements under Section 409A are either satisfied or are not applicable.

The affirmative vote of the holders of a majority of the shares of the Company’s common stock present in person or by proxy at the 2017 Annual Meeting of Stockholders and entitled to vote on the proposal is required to amend and restate the Company’s 2016 Performance Incentive Plan.

New Plan Benefits Table

The table below reflects awards granted by the LSC HR Committee on February 27, 2017. Because the Amended 2016 PIP is substantially similar to the 2016 PIP, for purposes of this table, the Company has assumed that the same awards would have been made under the Amended 2016 PIP if it would have been in place.

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PROPOSALS

PROPOSAL 5:3: RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Proposal 53 is the ratification of the Audit Committee’s appointment of Deloitte & Touche LLP as the independent registered public accounting firm to audit the financial statements of the Company for fiscal year 2017.2018. In the event the stockholders fail to ratify the appointment, the Audit Committee will reconsider this appointment. The Audit Committee, in its discretion, may direct the appointment of a different independent registered public accounting firm at any time during the year if the Audit Committee determines that such a change would be in the Company’s and its stockholders’ best interests. Representatives of Deloitte & Touche LLP will be present at the annual meeting. They will be available to respond to your questions and may make a statement if they desire.

The affirmative vote of the holders of a majority of the shares of the Company’s common stock present in person or by proxy at the 20172018 Annual Meeting of Stockholders and entitled to vote on the proposal is required to ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for 2017.2018. Deloitte & Touche LLP has served as our independent auditor since the Separation in October 2016.

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QUESTIONS AND ANSWERS ABOUT HOW TO VOTE YOUR PROXY

QUESTIONS AND ANSWERS ABOUT HOW TO VOTE YOUR PROXY

Below are instructions on how to vote, as well as information on your rights as a stockholder as they relate to voting. Some of the instructions vary depending on how your stock is held. It’s important to follow the instructions that apply to your situation.

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QUESTIONS AND ANSWERS ABOUT HOW TO VOTE YOUR PROXY

Remember that attendance at the annual meeting will be limited to stockholders as of the record date (March 30, 2017) with an admission ticket or evidence of their share ownership and guests of the Company.

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QUESTIONS AND ANSWERS ABOUT HOW TO VOTE YOUR PROXY

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QUESTIONS AND ANSWERS ABOUT HOW TO VOTE YOUR PROXY

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COMPANY INFORMATION

COMPANY INFORMATION

ABOUT THE CONTINUING DIRECTORS

The information below describes the directors who are not standing for election whose terms continue to run after the annual meeting. Information on directors who are standing for election this year is provided earlier under Proposal 1.

DIRECTORS OF CLASS II – TERMS EXPIRE IN 2018

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COMPANY INFORMATION

DIRECTORS OF CLASS III – TERMS EXPIRE IN 2019

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COMPANY INFORMATION

THE BOARD’S COMMITTEES AND THEIR FUNCTIONS

The Board has three standing committees. The members of those committees and the committees’ responsibilities are described below. Each committee operates under a written charter that is reviewed annually and is posted on the Investors section of the Company’s website at the following address: www.lsccom.com. A print copy of each charter is available upon request.

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COMPANY INFORMATION

Following the Separation, the LSCThe HR Committee has engaged Willis Towers Watson as its executive compensation consultant to provide objective analysis, advice and recommendations on executive pay in connection with the LSC HR Committee’s decision-making process.

In 2016,2017, Willis Towers Watson’s fees for executive compensation consulting services provided in preparation for the Separation and following the Separation were approximately $231,000. Additionally, Willis Towers Watson provided approximately $16,000 in unrelated human resources services to the Company.$215,000. SeeCompensation Discussion and & Analysis for more information regarding the LSC HR Committee’s relationship with Willis Towers Watson.

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COMPANY INFORMATION

POLICY ON ATTENDANCE AT STOCKHOLDER MEETINGS

Directors are expected to attend meetings of stockholders in person, except when circumstances prevent such attendance. When such circumstances exist, or in the case of special stockholder meetings, directors may participate by telephone or other electronic means and will be deemed present at such meetings if they can both hear and be heard. TheEight of the nine current members of the Board who were members at the time attended the Company’s 2017 Annual Meeting of Stockholders is the Company’s first annual meeting.in person.

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COMPANY INFORMATION

CORPORATE GOVERNANCE

Governance Highlights

The Company has adoptedCompany’s corporate governance practices and policies have been developed in accordance with the highest standards of integrity and include the adoption of a number of governance best practices including:

As described inCompensation Discussion and & Analysis, the Company intends to engageengages with stockholders about various corporate governance topics, including executive compensation.

Principles of Corporate Governance

The Board has adopted a set ofPrinciples of Corporate Governance to provide guidelines for the Company and the Board to ensure effective corporate governance. ThePrinciples of Corporate Governance cover topics including, but not limited to, director qualification standards, Board and committee composition, director access to management and independent advisors, director orientation and continuing education, director retirement age, succession planning and the annual evaluations of the Board and its committees. Such evaluations determine whether the Board and each committee are functioning effectively, and the Corporate Responsibility & Governance Committee considers the mix of skills and experience that directors bring to the Board to assess whether the Board has the necessary tools to form its oversight function effectively.

The Corporate Responsibility & Governance Committee is responsible for overseeing and reviewing the Company’sPrinciples of Corporate Governance and recommending to the Board any changes to those principles. The full text of thePrinciples of Corporate Governance is available on the Company’sInvestors section of our website at the following address: http://investor.lsccom.com/corporate-governance/governance-documents,lsccom.com, and a print copy is available upon request. References to the Company’s website address do not constitute incorporation by reference of the information contained on the website, and the information contained on the website is not part of this proxy statement.

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COMPANY INFORMATION

Principles of Ethical Business Conduct and Code of Ethics

In accordance with the NYSE listing requirements and SECSecurities and Exchange Commission (“SEC”) rules, the Company has adopted and maintains a set ofPrinciples of Ethical Business ConductConduct.. The policies referred to therein apply to all directors, officers and employees of the Company. In addition, the Company has adopted and will maintainmaintains aCode of Ethicsfor the Chief Executive Officer and Senior Financial Officers that applies to its chief executive officer and senior financial officers. ThePrinciples of Ethical Business Conduct and theCode of Ethicsfor the Chief Executive Officer and Senior Financial Officers cover all areas of professional conduct, including, but not limited to, conflicts of interest, disclosure

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COMPANY INFORMATION

obligations, insider trading and confidential information, as well as compliance with all laws, rules and regulations applicable to our business. The Company encourages all employees, officers and directors to promptly report any violations of any of the Company’s policies. In the event that an amendment to, or a waiver from, a provision of theCode of Ethicsforthe Chief Executive Officer and Senior Financial Officers is necessary, the Company will post such information on its website. The full text of each of thePrinciples of Ethical Business Conduct and ourCode of Ethics is available on the Company’sCorporate Governance section of the Investors portion of our website at the following address: http://investor.lsccom.com/corporate-governance/governance-documents,lsccom.com, and print copies are available upon request. References to the Company’s website address do not constitute incorporation by reference of the information contained on the website, and the information contained on the website is not part of this proxy statement.

Director Independence

The Company’sPrinciples of Corporate Governance provide that the Board must be composed of a majority of independent directors. No director qualifies as independent unless the Board affirmatively determines that the director has no relationship which, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. AllThe Board has determined that all eightnon-employee directors of our Board are also independent in accordance with the NYSE requirements. Mr. Quinlan, who as an employee of the Company, is not independent.

Executive Sessions

The Company’s independent directors are expected to meet regularly in executive sessions without management. Executive sessions are led by the lead directorLead Director of the Board. An executive session is expected to be held in conjunction with each regularly scheduled Board meeting. Each committee of the Board also is expected to meet in executive sessionssession without management in conjunction with each regularly scheduled committee meeting and such sessions will be led by the chairchairman of such committee.

Board Leadership

Our Board has the discretion to combine or separate the roles of chairman and chief executive officer as the Board deems appropriate based on the needs of the Company at any given time. To facilitate this decision-making, the Corporate Responsibility & Governance Committee will annually discussdiscusses our Board leadership structure, providing its recommendation on the appropriate structure to our independent directors. The Board has determined that having a combined chairman and chief executive officer with an independent lead directorLead Director is the most appropriate Board leadership structure for LSC. This structure puts one person in the best position to be aware of major issues facing the Company on aday-to-day and long-term basis, and to identify and bring key risks and developments facing the Company to the Board’s attention (in coordination with the lead directorLead Director as part of the agenda-setting process). As set forth in ourPrinciples of Corporate Governance,, our lead director, in coordination with the chairman/chief executive officer, reviews and approves agendas for Board meetings, materials and information sent or presented to the Board and meeting schedules. In addition, our lead director has the authority to add items to the agenda for any Board meeting, presides at executive sessions of independent directors, which will be held at each regular Board meeting, serves as anon-exclusive liaison between the other independent directors and the chairman/chief executive officer, may call meetings of the independent directors in his or her discretion and chair any meeting of the Board or stockholders at which the chairman is absent, is available to meet with major stockholders and regulators under appropriate circumstances, and in conjunction with the chairman of the Human Resources Committee, discusses with the chairman/chief executive officer the Board’s annual evaluation of his or her performance as chief executiveLead Director:

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COMPANY INFORMATION

officer. In addition, the powers of the chairman under ourBy-laws are limited other thanto chairing meetings of the Board and meetings of stockholders to theas well as certain other powers conferred on the chairman (suchsuch as the ability to call special meetings of stockholders or the Board) andBoard. These powers can also be exercised by the Board, orby a specified number of directors or, in some cases, the lead director, orLead Director. Some of the chairman’s powers are administrative in nature (such as the authority to execute documents on behalf of the Company).

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COMPANY INFORMATION

Board’s Role in Risk Oversight

The Board and each of its committees is actively involved in oversight of risks inherent in the operation of the Company’s businessesbusiness and the implementation of its strategic plan. The Board performs this oversight role by using several different levels of review. In connection with its reviews of the operations of the Company’s business units and corporate functions, the Board addresses the primary risks associated with those units and functions. In addition, the Board reviews the key risks associated with the Company’s strategic plan, annually and periodically throughout the year, as part of its consideration of the strategic direction of the Company, as well as reviews and discusses the output of the Company’s enterprise risk management process each year.

The Board has delegated to the Audit Committee oversight of the Company’s enterprise risk management process. Among its duties, the Audit Committee will review with management (1) Company policies with respect to risk assessment and management of risks that may be material to the Company, (2) the Company’s system of disclosure controls and system of internal controls over financial reporting, and (3) the Company’s compliance with legal and regulatory requirements.

Each of the other Board committees also oversees the management of Company risks that fall within the committee’s areas of responsibility. In performing this function, each committee has full access to management, as well as the ability to engage advisors, and each committee reports back to the Board. The Audit Committee oversees risks related to the Company’s financial statements, the financial reporting process, other financial matters, certain compliance issues and accounting and legal matters. The Audit Committee, along with the Corporate Responsibility & Governance Committee, is also responsible for reviewing certain major legislative and regulatory developments that could materially impact the Company’s contingent liabilities and risks. The Corporate Responsibility & Governance Committee also oversees risks related to the Company’s governance structure and processes, related person transactions, certain compliance issues and Board and committee structure to ensure appropriate oversight of risk. The Human Resources Committee considers risks related to the attraction and retention of key management and employees and risks relating to the design of compensation programs and arrangements, as well as succession planning for key senior management positions.

Nomination of Directors

It is the policy of the Corporate Responsibility & Governance Committee to consider those candidates for director recommended by stockholders. In order to recommend a candidate, stockholders must submit the individual’s name and qualifications in writing to the Corporate Responsibility & Governance Committee (in care of the Secretary at the Company’s principal executive offices at 191 N. Wacker Drive, Suite 1400, Chicago, Illinois 60606) and otherwise in accordance with the procedures outlined underSubmitting Stockholder Proposals and Nominations for 20182019 Annual Meeting. The Corporate Responsibility & Governance Committee evaluates candidates recommended for director by stockholders in the same way that it evaluates any other candidate.

The Corporate Responsibility & Governance Committee also considers candidates recommended by management and members of the Board as well as nominees recommended by stockholders.

In identifying and evaluating nominees for director, the Corporate Responsibility & Governance Committee takes into account the applicable requirements for directors under the listing rules of the NYSE. In addition, the Corporate Responsibility & Governance Committee considers other criteria as it deems appropriate and which may vary over time depending on the Board’s needs, including certain core competencies and other criteria such as the personal and

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Board Risk Oversight Includes: + Strategic plan and direction + Annual budget + Operations of the Company’s business units and corporate functions + Review of the output of the Company’s enterprise risk management process Audit Committee Risk Oversight Includes: + Enterprise risk management process + Disclosure controls + Internal controls over financial reporting + Compliance with legal and regulatory requirements Management + Financial, legal and compliance Risk Corporate Responsibility & HR Committee Risk Oversight Includes: Governance Committee Risk Oversight + Attraction and retention of key Includes: management and employees Reputational + Governance structure and processes + Design of compensation programs and + Related person transactions arrangements + Certain compliance issues + Succession planning for key senior + Board and committee structure management positions + Legislative and regulatory developments

COMPANY INFORMATION

professional qualities, experience and education of the nominees, as well as the mix of skills and experience on the Board prior to and after the addition of the nominees. Although not part

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COMPANY INFORMATION

of any formal policy, the goal of the Corporate Responsibility & Governance Committee is a balanced and diverse Board, with members whose skills, viewpoint, backgroundviewpoints, backgrounds and experienceexperiences complement each other and, together, contribute to the Board’s effectiveness as a whole.

The Corporate Responsibility & Governance Committee may engage third-party search firms to identify candidates for director and to do preliminary interviews and background and reference reviews of prospective candidates.

Communications with the Board of Directors

The Board has established procedures for stockholders and other interested parties to communicate with the Board. A stockholder or other interested party may contact the Board by writing to the chairman of the Corporate Responsibility & Governance Committee or the othernon-management members of the Board to their attention at 99 Park Avenue, 14^th Floor, New York, New York 10016;191 N. Wacker Drive, Suite 1400, Chicago, IL 60606; Attention: Secretary. Any stockholder must include the number of shares of the Company’s common stock he or she holds, and any interested party must detail his or her relationship with the Company in any communication to the Board. Communications received in writing will be distributed to the chairman of the Corporate Responsibility & Governance Committee ornon-management directors of the Board as a group, as appropriate, unless such communications are considered, in the reasonable judgment of the Company’s Secretary, improper for submission to the intended recipient(s). Examples of communications that would be considered improperinappropriate for submission include, without limitation, customer complaints, solicitations, communications that do not relate directly or indirectly to the Company or the Company’s business or communications that relate to improper or irrelevant topics.

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STOCK OWNERSHIP

STOCK OWNERSHIP

The table below lists the beneficial ownership of common stock as of March 30, 201729, 2018 by all directors and nominees, each of the persons named in the tables underExecutive Compensation below, and the directors and executive officers as a group andgroup. The table includes all stock awards subject to vesting conditions that vest within 60 days of March 30, 2017.29, 2018. The table also lists all institutions and individuals known to hold more than 5% of the Company’s common stock, which information has been obtained from filings made pursuant to Sections 13(d) and (g) of the Exchange Act. Except as otherwise indicated below, each of the entities or persons named in the table has sole voting and investment power with respect to all common stock beneficially owned set forth opposite their name. The percentages shown are based on outstanding shares of common stock as of March 30, 2017.29, 2018. Unless otherwise indicated, the business address of each stockholder listed below is LSC Communications, 191 N. Wacker Drive, Suite 1400, Chicago, IL 60606.

BENEFICIAL STOCK OWNERSHIP OF DIRECTORS, EXECUTIVES AND LARGE STOCKHOLDERS

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STOCK OWNERSHIP

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COMPENSATION DISCUSSION & ANALYSIS

COMPENSATION DISCUSSION & ANALYSIS

EXECUTIVE SUMMARY

In this Compensation Discussion and& Analysis (“CD&A”), we will describe the material components of our executive compensation programsprogram applicable to our named executive officers (our “NEOs”). While the discussion in thethis CD&A is focused on our NEOs, many components of our executive compensation programsprogram apply broadly across our executive ranks.

BACKGROUND

On October 1, 2016, RRD completed the Separation into three independent public companies:

Donnelley Financial Solutions, Inc. (“Donnelley Financial” or “DFS”), LSC Communications, Inc. (“LSC,” “LSC Communications,” “we,” “our,” “us” and the Company) and RR Donnelley.

Prior to the Separation, RRD’s senior management and the human resources committee of the RRD board of directors (the “RRD HR Committee”), determined RRD’s compensation strategy. Since the information presented in the compensation tables of this proxy statement relates to the 2016 fiscal year, which ended on December 31, 2016, this CD&A focuses in the early sections on RRD’s compensation programs and decisions prior to the Separation (when LSC was part of RRD) and then in the later sections, on LSC’s compensation program and decisions following the Separation. Thepre-Separation compensation information may not in all cases be directly relevant to the compensation our these executive officers will receive post-Separation. Following the Separation, the LSC HR Committee determined the executive compensation strategy. Within this CD&A, the Board will be referred to as the “LSC Board.”

This CD&A presents historical information regarding compensation received from RRDpre-Separation and from us post-Separation in 2016 for the following individuals, our named executive officers, or NEOs:Our NEOs include:

Messrs. Quinlan and Coxhead and Ms. Bettman were, prior to the Separation, namedLSC’s executive officers of RRD (the“Pre-Separation NEOs”). Messrs. Hansen and Lane were notPre-Separation NEOs, and the following discussion of thePre-Separation compensation program is therefore not applicabledesigned to their compensation in all cases. SeeCompensation Discussionstrike an appropriate balance among rewarding our executives for strong performance, ensuring long-term LSC success, considering stockholder interest and Analysis—RRD Pre-Separation CompensationProgram—Pre-Separation Compensation for Messrs. Hansen and Lane for additional information.

LSC Post-Separation Compensation Program

Following the Separation, the LSC HR Committee reviewed the impact of the Separation, determined future aspects of LSC’s compensation program and made appropriate adjustments. SeeCompensation Discussion and Analysis—LSC Post-Separation Compensation Program for additional information.

The LSC HR Committee determined that it was important in connectionencouraging our executive talent to remain with the Separation to grant to a limited groupCompany.

This CD&A describes LSC’s Compensation Philosophy, the components of executives, which included the NEOs, a one-time, non-recurring “Founders’ Award” to provide incentive for the long-term retention of the executives, align such executives’ interests with new stockholder interests, and allow participants to share in post-Separation gains in LSC value. These Founders’ Awards were in the form of restricted stock awards and were granted on the date of the Separation by the new LSC HR Committee. Among other considerations, to ensure consistency with the Company’s compensation philosophy, the LSC HR Committee reviewed the following factors in determining the Founders’ Awards: competitive practices relative to other corporate spin-off companies; market data on the size of the awards as a range of percentage of salary; and the roles and positions of each participant. The LSC HR Committee also determined at the time of the grant of the Founders’ Awards that, in consideration of his Founders’ Award, the CEO would

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COMPENSATION DISCUSSION & ANALYSIS

not be eligible for a grant under the long-term incentive program in 2017. SeeCompensation Discussion&Analysis — LSC Post-Separation Compensation Decisions — Long-Term Incentive Program for additional information.

RRDPRE-SEPARATION COMPENSATION PROGRAM

The following discussion describes the practices and policies implemented by the RRD HR Committee prior to the Separation with respect to thePre-Separation NEOs (Messrs. Quinlan and Coxhead and Ms. Bettman).

RRDPre-Separation Compensation Philosophy

Theour executive compensation program, at RRD was designedour decision-making process, our 2017 compensation decisions and other relevant policies and practices. Some highlights of the Company’s performance as well as our 2017 executive compensation program are below.

2017 Company Highlights

LSC took significant actions in 2017 to alignimplement our strategic vision for our first full year as a stand-alone company following the interests of RRD stockholdersSeparation and executive officers while providing a total compensation package that enabled RRD to attract, retain and motivate executives. Overall compensation levels were targeted at market survey data medians and, where available, peer group medians, with a range of opportunity to reward strong performance or withhold rewards when objectives were not achieved.

Historically, RRD’s compensation philosophy was guided by five principles:we successfully:

RRDPre-Separation2017 Executive Compensation Best PracticesProgram Highlights

Consistent with its compensation philosophy, RRD adopted the following compensation best practices:

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COMPENSATION DISCUSSION & ANALYSIS

2016Pre-Separation RRD Peer Group

In 2015, Willis Towers Watson completed a thorough review of RRD’s compensation peer group at the request of the RRD HR Committee. As a result of this analysis, several changes were made to the peer group. The primary focus of this process was to include industrial companies of generally similar or larger size, complexity and scope rather than companies only in RRD’s industry, since RRD was significantly larger than all of its direct competitors and the markets for talent were necessarily broader. The resulting peer group, approved in 2015 and continued without change until the date of the Separation, was comprised of the following 26 companies:

2016Pre-Separation RRD Compensation Overview

RRD recognized the need for its compensation programs to be appropriately modified to take into account the Separation, which was scheduled to be completed during 2016. Guided by the principles noted above, the RRD HR Committee kept the overall construct of RRD’s 2016 compensation programs straightforward, with a focus on simplicity and consistency.

To that end, the RRD HR Committee determined that for 2016:

Consistent with prior years, compensation for thePre-Separation NEOs was comprised of three major components: base salary, annual incentive compensation and long-term incentive compensation. In addition,

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thePre-Separation NEOs were eligible to participate in benefit programs generally available to other executives within RRD and other benefits provided to certain executives.See Compensation Discussion and Analysis—RRDPre-Separation Compensation Program—RRDPre-Separation Benefit Programs for additional information.

In general, compensation levels for thePre-Separation NEOs were targeted at the 50th percentile of peer group data, when available for a position, and by market survey data from the Willis Towers Watson 2016 CDB General Industry Executive Compensation Survey Report and Mercer’s 2016 US MDB: Executive Compensation Survey. This 50th percentile target level provided a total competitive anchor point for RRD’s executive compensation program. Actual compensation levels varied up or down from targeted levels based on company performance, individual performance and individual experience levels.

The table below sets out the elements of the compensation program for thePre-Separation NEOs.

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COMPENSATION DISCUSSION & ANALYSIS

Base Salary

The RRD HR Committee provided no base salary increases to thePre-Separation NEOs in 2016.

Annual Incentive PlanPHILOSOPHY

The threshold and corporate financial targets under the 2016 AIP were set by the RRD HR Committee at the beginning of the year following the presentation of the annual operating budget to the RRD board of directors (the “RRD Board”). The table below sets forth a description of such targets and the individual performance goals under the AIP.

2016 AIP targets as a percentage of base salary were 150% for Mr. Quinlan and Ms. Bettman and 100% for Mr. Coxhead.

The 2016pre-Separation performance payout curve (which was the same curve as used in 2015) was structured as follows:

The RRD HR Committee had the discretionary authority to increase or decrease the amount of the AIP award of employees not designated as “covered employees” under Section 162(m) if the RRD HR Committee determined, prior to the end of the plan year, that an adjustment was appropriate to better reflect the actual performance of RRD and/or the participant. The RRD HR Committee could not increase the amount of the award payable to a person who was a “covered employee” to an amount in excess of the amount earned under the RRD 2012 Performance Incentive Plan.

The RRD HR Committee had discretionary authority to decrease the amount of any AIP award otherwise payable at any time for any person designated as an executive officer of RRD for purposes of Section 16 of the Exchange Act, including after the end of the plan year. Additionally, the RRD HR Committee had discretionary authority to reduce the amount of the award otherwise payable if it determined that any participant had engaged in misconduct.

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COMPENSATION DISCUSSION & ANALYSIS

RRD Separation Cost Reduction Incentive

In early 2016, to maintain focus on the work to be done for the Separation as well as a focus on effecting the Separation in the most cost-effective manner, the RRD HR Committee implemented a spin cost reduction incentive (the “Separation Cost Reduction Incentive”) under the AIP, which granted a cash award to each of thePre-Separation NEOs other than Mr. Quinlan, the pre-Separation RRD Chief Executive Officer (who received no bonus with respect to the Separation), in an amount equal to 1x the recipient’s then-current salary to be paid in March 2017 if the total costs incurred by RRD in connection with the Separation (excluding debt and financing costs) were equal to or less than $169 million. The RRD HR Committee determined this threshold after reviewing comparable transactions and their costs. After the Separation, the RRD HR Committee reviewed such costs and certified that the total Separation-related costs (excluding debt and financing costs) were less than the $169 million target, so that such Separation Cost Reduction Incentive cash awards became payable.

Long-Term Incentive Program

RRD’s stockholder-approved incentive plans allow for the RRD HR Committee to grant PSUs, RSUs, stock options and cash awards to any eligible employee. No stock options have been granted since 2012.

With respect to 2016 compensation decisions, the RRD HR Committee had a series of discussions regarding the most appropriate way to motivate and retain its executives while still maintaining a continued focus on producing strong operating results and effectively executing the Separation. While historically the RRD long-term incentive program had consisted of both PSUs and RSUs, the RRD HR Committee determined that given the Separation, setting three year performance-related targets for all three companies would not be meaningful. Therefore, RSUs that cliff vest after three years in the company where the executive officer is employed post-Separation were granted to allPre-Separation NEOs at a level consistent with grants in prior years as part of overall compensation targeted at the 50th percentile of peer group data, when available for a position, and by market survey data. The RSUs do not accrue dividends on unvested units.

In addition, the stockholder-approved incentive plans permit delegation of the RRD HR Committee’s authority to grant equity to employees other than named executive officers in certain circumstances. The RRD HR Committee delegated such authority to its Chief Executive Officer over a small pool of equity and cash awards to key employees who are not executive officers of RRD.

Pre-Separation Compensation for Messrs. Hansen & Lane

Messrs. Hansen and Lane were not executive officers of RRD prior to the Separation, and the preceding discussion of thepre-Separation RRD compensation program is therefore not applicable to their compensation in all cases. Following the Separation, both became executive officers of LSC.

MR. HANSEN. Mr. Hansen was hired shortly before the date of the Separation, with the plan being that following the Separation, he would be LSC’s Chief Accounting Officer and Controller. Mr. Hansen’spre-Separation compensation was comprised of base salary, annual incentive compensation and benefits. Upon hire, his base salary was set by his manager and he received a signing bonus.

Under the AIP, Mr. Hansen worked with his manager to develop his individual performance goals. The same threshold and corporate financial targets set by the RRD HR Committeepre-Separation were applicable to Mr. Hansen. Mr. Hansen’s AIP targetpre-Separation was 75% of his base salary.

MR. LANE.Mr. Lane’spre-Separation compensation was comprised of base salary, annual incentive compensation, long-term incentive compensation and benefits. Decisions regarding Mr. Lane’spre-Separation compensation were made by his manager. Mr. Lane’s base salary was reviewed annually with regard to his performance, responsibilities and salary levels for similar positions at RRD. Mr. Lane’s base salary was not increased in 2016 prior to the Separation. Mr. Lane is reimbursed for his monthly dues and business entertainment expenses for one country club membership.

Under the AIP, Mr. Lane worked with his manager to develop his individual performance goals. The same threshold and corporate financial targets set by the RRD HR Committee pre-Separation were applicable to Mr. Lane. Mr. Lane’s AIP targetpre-Separation was 100% of his base salary.

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COMPENSATION DISCUSSION & ANALYSIS

Prior to 2016, special long-term incentive cash awards were granted to certain employees of RRD, including Mr. Lane. While no such awards were granted in 2016, awards from prior years vested in 2016 and will continue to vest in 2017. In addition, a discretionary spin retention bonus was awarded to Mr. Lane payable upon completion of the Separation. Mr. Lane’s manager recommended the number of RSUs granted to him in 2016 prior to the Separation.

Treatment of RRD Equity and Cash Awards in Connection with the Separation

In connection with the Separation, outstanding RRD equity and cash awards were treated as follows:

The exercise price and number of shares subject to each option were adjusted pursuant to the formula proscribed by the Separation and Distribution Agreement (as defined inCertain Relationships and Related Party Transactions) in order to preserve the aggregate intrinsic value (that is, the difference between the exercise price of the option and the market price of the shares for which the option may be exercised) of the converted options immediately after the Separation to be the same as the intrinsic value of the RRD options immediately prior to the Separation.

All PSU and RSU awards were converted into RSU awards of LSC, RRD and Donnelley Financial common stock, as applicable, pursuant to a formula provided by the Separation and Distribution Agreement in order to preserve the aggregate intrinsic value of the original award, as measured immediately before and immediately after the Separation.

All equity and cash awards remain subject to the same terms and conditions (including with respect to vesting) immediately following the date of the Separation as applicable to the corresponding RRD award immediately prior to the date of the Separation, except that awards that were originally RRD PSU awards remained subject to only time-based vesting for the remainder of the applicable performance period following the date of the Separation.

Following the date of the Separation, the RRD HR Committee determined the achievement level of the performance conditions on the PSUs. The achievement level for PSU awards granted in 2014 was 96% of the

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performance target, which equated to a 90% payout level. The achievement level for PSU awards granted in 2015 was 82.1% of the performance target and, with an organic revenue growth modifier applied, equated to a 54.1% payout level.

RRDPre-Separation Benefit Programs

Pre-Separation RRD benefit programs were established based upon an assessment of competitive market factors and a determination of what was needed to retain high-caliber executives. RRD’s primary benefits for executives included participation in RRD’s broad-based plans at the same benefit levels as other employees. These plans included: retirement plans, savings plans, RRD’s health and dental plans and various insurance plans, including disability and life insurance.

RRD also provided certain executives, including certain of thePre-Separation NEOs and certain of our NEOs, the following benefits:

RRDPre-Separation Tax Deductibility Policy

The RRD HR Committee considered the deductibility of compensation for federal income tax purposes in the design of RRD’spre-Separation programs. While RRD generally sought to maintain the deductibility of the incentive compensation paid to its executive officers, the RRD HR Committee retained the flexibility necessary to provide cash and equity compensation in line with competitive practices, its guiding principles, and the best interests of RRD stockholders even if these amounts are not fully tax deductible.

The 2016 AIP threshold target was based on consolidated revenue and established a multiplier for eachPre-Separation NEO (for the President/CEO and Chief Operating Officer, 5x base salary; and for the otherPre-Separation NEOs, 3x base salary) for tax deductibility purposes under Section 162(m) of the Internal Revenue Code. These award pools were the absolute maximum limitations on the dollar value of awards earned. The RRD HR Committee then exercised negative discretion to reduce the amount of thepre-Separation

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AIP award for eachPre-Separation NEO and determined the actual annual cash incentive payouts, guided by its consideration of the performance of RRD against the financial threshold (for 2016,non-GAAP reported EBITDA) and individual performance objectives.

Pre-Separation Operation of the RRD Human Resources Committee

The RRD HR Committee established and monitored RRD’s overall compensation strategy to ensure that executive compensation supported the business objectives and specifically established the compensation of the CEO, other senior officers and key management employees. The RRD HR Committee did not administer the employee benefit plans, nor did it have direct jurisdiction over them, but it reviewed the employee benefit plans so as to have a better understanding of the overall compensation structure of RRD. In carrying out its responsibilities, the RRD HR Committee, with assistance from its compensation consultant, Willis Towers Watson, reviewed and determined the compensation (including salary, annual incentive, long-term incentives and other benefits) of RRD’s executive officers, including thePre-Separation NEOs. Management, including RRD’s executive officers, developed preliminary recommendations regarding compensation matters with respect to the executive officers other than the CEO for RRD HR Committee review. The RRD HR Committee then reviewed management’s preliminary recommendations and made final compensation decisions.

Pre-Separation Role of the RRD Compensation Consultant

Compensation of executive officers was overseen by the RRD HR Committee, which engaged Willis Towers Watson as its executive compensation consultant to provide objective analysis, advice and recommendations on executive officer compensation and related matters in connection with the RRD HR Committee’s decision-making process. In addition, and related to the Separation, the RRD HR Committee considered the many compensation program changes and transitions that needed to occur as a result of creating three independent public companies and requested that Willis Towers Watson conduct a special review of decisions that were made over the course of 2016 with regard to the Separation. Willis Towers Watson regularly attended RRD HR Committee meetings and reported directly to the RRD HR Committee, not to management, on matters relating to compensation for the executive officers and for directors.

Willis Towers Watson provided additional services to RRDpre-Separation not under the direction of the RRD HR Committee, which services werepre-approved by the RRD HR Committee. The RRD HR Committee reviewed the work and services provided by Willis Towers Watson and it determined that (a) such services were provided on an independent basis and (b) no conflicts of interest existed. Factors considered by the RRD HR Committee in its assessment included:

Pre-Separation Risk Assessment

In 2016, the RRD HR Committee, with the assistance of Willis Towers Watson, reviewed and evaluated RRD’s executive and employee compensation practices and concluded, based on this review, that any risks associated with such practices were not likely to have a material adverse effect on RRD. The determination primarily took

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into account the balance of cash and equity payouts, the balance of annual and long-term incentives, the type of performance metrics used, incentive plan payout leverage, possibility that the plan designs could be structured in ways that might encourage gamesmanship, avoidance of uncapped rewards, multi-year vesting for equity awards, use of stock ownership requirements for senior management and the RRD HR Committee’s oversight of all executive compensation programs.

Pre-Separation Role of RRD Management

RRD management, including the pre-Separation CEO, developed preliminary recommendations regarding compensation matters with respect to all RRD executive officers, other than the CEO, and provided these recommendations to the RRD HR Committee, which made the final decisions, with advice from Willis Towers Watson, as appropriate. The management team was responsible for the administration of the compensation programs once RRD HR Committee decisions were finalized.

LSC POST-SEPARATION COMPENSATION PROGRAM

Compensation of executive officers is overseen by the LSC HR Committee. The following discussion describes the practices and policies implemented by the LSC HR Committee following the date of the Separation with respect to the NEOs’ post-Separation compensation for 2016. Other than as described below, the LSC HR Committee determined to continue the executive compensation program for the remainder of 2016 with the same elements as RRD’s executive compensation program and will establish objectives and/or elements for the program for 2017 and forward as needed. The executive compensation program at LSC is designed to strike an appropriate balance between aligning stockholder interests, rewarding its executives for strong performance, ensuring long-term success and retaining its key executive talent.

The LSC HR Committee engaged Willis Towers Watson as its executive compensation consultant to provide objective analysis, advice and recommendations on 2016 post-Separation executive officer pay in connection with the LSC HR Committee’s decision-making process.

LSC Post-Separation Compensation Philosophy

Post-Separation, the LSC HR Committee adopted the following compensation philosophyLSC Compensation Philosophy at the time of the Separation to guide its compensation decisions:

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LSC Post-Separation Compensation Best Practices

Consistent with its compensation philosophy, LSC has adopted the following compensation best practices: