Donald now has five top-three-finishes in the Heritage but no victories.
He began the day seven-under and ended there, too, after a round that included two birdies and two bogeys in a four-hole stretch.
Grace, meanwhile, wasted no time in challenging Donald’s lead, with birdies at his first two holes.
He bounced back from a bogey at the fourth with birdies on the next two holes and another on the ninth to take the lead into the back nine, where he made two birdies and a bogey coming in.
It was a good turnaround for the 14th-ranked Grace, after he missed the cut at the Masters last week.