Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of certain Officers; Compensatory Arrangements of Certain Officers.
(e) On October 26, 2016, the Management Development and Compensation Committee (the Committee) of the Board of Directors of the Company
completed a review of the Companys legacy form of severance and change in control agreements for certain of its executive officers. Following such review, the Committee approved (i) an updated form of severance agreement (the
Severance Agreement), which consolidates and updates the terms and conditions of the Companys legacy forms, and (ii) the use of the Severance Agreement for Victor D. Grizzle, the Companys Chief Executive Officer, and certain
of its executive officers, namely Charles M. Chiappone, David S. Cookson, Mark A. Hershey, Brian L. MacNeal, Stephen F. McNamara and Ellen R. Romano. The Severance Agreement will supersede and replace any existing severance and change in
control agreements between the Company and such individuals.
Pursuant to the Severance Agreements, each executive will be entitled to receive: (i)
certain cash severance benefits (Severance) if the executives employment is terminated by the Company (other than: (a) for Cause, (b) by reason of death or Disability, (c) by the executive without Good Reason, or (d) in connection
with a Change in Control (as such terms are defined in the Severance Agreement)) or (ii) certain cash severance benefits (CIC Severance) if the executives employment is terminated by the Company following a Change in Control (other
than: (a) for Cause, (b) by reason of death or Disability, or (c) by the executive without Good Reason).
The amount for Severance and CIC Severance is
equal to (i) a multiple of the executives then-current annual base salary plus his or her target annual incentive under the Companys annual incentive program, payable in lump sum, and (ii) a pro-rated annual incentive bonus based on
actual performance for the year of termination, payable at the time that bonuses are paid to employees of the Company generally.
For Severance, the
multiple is equal to one (1) times for Mr. McNamara, one and one-half (1.5) times for Messrs. Chiappone, Cookson, Hershey, MacNeal and Ms. Romano, and two (2) times for Mr. Grizzle. For CIC Severance, the multiple is equal to one and one-half (1.5)
times for Mr. McNamara, two (2) times for Messrs. Chiappone, Cookson, Hershey, MacNeal and Ms. Romano, and two and one-half (2.5) times for Mr. Grizzle.
As a condition to receiving severance benefits, each executive must sign a release of claims.
The foregoing summary of the Severance Agreements does not purport to be complete and is qualified in its entirety by reference to the text of the agreements,
which are attached as Exhibit 10.1, and is incorporated herein by reference.