It looks like the recipient isn't a valid email address in your Office 365 address book, but it exists in your organization's ...

It looks like the recipient isn't a valid email address in your Office 365 address book, but it exists in your organization's on-premises mail server. To fix this problem for the Recipient: {Recipient}, you need to add the external email address to Office 365.
  1. In the Exchange admin center, go to the Contacts page.
  2. Choose New (Add icon), choose Mail contact.
  3. Complete the required fields in the new mail contact page.