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AMENDED AND RESTATED EMPLOYMENT AGREEMENT

Employee Retention Agreement

AMENDED AND RESTATED EMPLOYMENT AGREEMENT | Document Parties: SPRINT CORPORATION | SPRINT NEXTEL CORPORATION | SPRINT/UNITED MANAGEMENT COMPANY You are currently viewing:
This Employee Retention Agreement involves

SPRINT CORPORATION | SPRINT NEXTEL CORPORATION | SPRINT/UNITED MANAGEMENT COMPANY

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Title: AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Governing Law: Kansas     Date: 12/19/2008
Industry: Communications Services     Sector: Services

AMENDED AND RESTATED EMPLOYMENT AGREEMENT, Parties: sprint corporation , sprint nextel corporation , sprint/united management company
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Exhibit 10.2

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this " Agreement ") is made and entered into as of December 31, 2008 and amends and restates the Employment Agreement (the "Original Employment Agreement") originally made and entered into December 3, 2003 (the " Effective Date "), by and among SPRINT CORPORATION, renamed SPRINT NEXTEL CORPORATION, a Kansas corporation (" Sprint "), SPRINT/UNITED MANAGEMENT COMPANY, a Kansas corporation and subsidiary of Sprint (" SUMC ") (Sprint, SUMC and the subsidiaries of Sprint are collectively referred to herein as the " Company "), and KATHRYN A. WALKER (" Executive ").

Recitals

 

 

1.

Because the Company is mindful of Executive’s substantial contributions to the Company and of her attractiveness in the competitive marketplace, both within and outside of the telecommunications industry, it desires to insure her continued employment with the Company, it desires to encourage her to maintain and increase her ownership of Company stock, and it desires to provide her appropriate compensation arrangements that continue to motivate her to focus on and increase shareholder value.

 

 

2.

Executive has been, and now is, serving as Chief Information and Network Officer.

 

 

3.

The Company desires to continue to secure the continued long-term employment of Executive.

 

 

4.

Executive and the Company entered into a Special Compensation and Non-Compete Agreement, dated February 8, 1999 (the " Severance Agreement ").

 

 

5.

Executive and the Company desire to amend and restate the Original Employment Agreement as provided herein.

 

 

6.

Certain capitalized terms used herein are defined parenthetically throughout this Agreement or defined in Section 6 of this Agreement.

NOW, THEREFORE, in consideration of the promises and mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which consideration is mutually acknowledged by the parties, the parties hereby amend and restate the Original Employment Agreement as follows:

 

1.

Employment and Termination

 

1.01.

Conditions of Employment

Subject to the terms of this Agreement, the Company hereby agrees to continue to employ Executive as Chief Information and Network Officer, with such authority, power, responsibilities, and duties customarily exercised by a person holding such position in a company of the size and nature of the Company.




1.02.

Performance of Duties

Executive shall, during her employment with the Company, owe an undivided duty of loyalty to the Company and agrees to use her best efforts to promote and develop the business of the Company. Executive agrees that, during her employment with the Company, she must devote her full business time, energies, and talents to serving as a senior executive officer of the Company and that she shall perform her duties faithfully and efficiently subject to the directions of the Board. Notwithstanding the foregoing, Executive may, subject in all cases to the Company’s Principles of Business Conduct (or any successor code of conduct) (i) serve as a director, trustee, or officer or otherwise participate in not-for-profit educational, welfare, social, religious, and civic organizations; (ii) serve as a director of any for-profit business listed on Exhibit A hereto or, with the prior consent of the Board, serve as a director of any for-profit business that is not a Competitor; and (iii) acquire passive investment interests in one or more entities, to the extent that the other activities do not inhibit or interfere with the performance of Executive’s duties under this Agreement, or to the knowledge of Executive conflict in any material way with the business or policies of the Company.

 

1.03.

Term of Employment

The term of Executive’s employment under this Agreement (the " Employment Term ") began on the Effective Date and ends on Executive’s 65th birthday (the " End Date "). This Agreement sets forth certain terms of Executive’s employment during the Employment Term, the consequences of any termination of employment during the Employment Term, and the terms of certain restrictive covenants by Executive during and after the Employment Term. The Company and Executive agree that the employment relationship is at will, and either party may terminate the employment relationship for any reason in accordance with the procedures and with the consequences set forth in this Agreement.

 

1.04.

Procedures for Termination

 

(a)

General Procedures

Except as set forth below, any purported termination of this Agreement or of Executive’s employment by the Company or by Executive during the Employment Term, other than by Executive’s death, shall be communicated by a written notice of termination to the other party hereto delivered in accordance with Section 14 below indicating the specific termination provision in this Agreement relied upon and setting forth in reasonable detail the facts and circumstances claimed to provide a basis for termination under the provision so indicated. Any such termination will be effective on the Termination Date.

 

(b)

Cause Termination

The Company may not terminate Executive’s employment for Cause during the Employment Term until it delivers to Executive a written notice stating that Executive is guilty of conduct constituting Cause by reference to one or more clauses of Section 6.06 and specifying the particulars thereof in reasonable detail.

 

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(c)

CIC Good Reason Termination

Executive may terminate her employment for CIC Good Reason during the Employment Term only within the CIC Protected Period following written notice and an opportunity for the Company to cure; provided, however, that Executive may not give notice of termination for CIC Good Reason during any Period in which Executive is unable to substantially perform her duties with the Company due to physical or mental illness. In order to effect a termination for CIC Good Reason, Executive must, within 60 days following the event or circumstance giving rise to Executive’s claim, deliver a written notice to the Company that sets forth the specific event or circumstance giving rise to CIC Good Reason by reference to one or more clauses of the definition of CIC Good Reason set forth in Section 6.09 of this Agreement. If, within 30 days following notice from Executive, the Company corrects, in all material respects, the events or circumstances giving rise to Executive’s claim for CIC Good Reason, Executive shall not be entitled to terminate her employment for CIC Good Reason by reason of such event or circumstance.

 

(d)

Non-CIC Good Reason Termination

Executive may terminate her employment for Non-CIC Good Reason any time during the Employment Term following written notice and an opportunity for the Company to cure. In order to effect a termination for Non-CIC Good Reason, Executive must deliver a written notice to the Company within 60 days following the event or circumstance giving rise to Executive’s claim of Non-CIC Good Reason. The notice must set forth the specific event or circumstance giving rise to Non-CIC Good Reason by reference to one or more clauses of the definition of Non-CIC Good Reason set forth in Section 6.24 of this Agreement. If, within 30 days following notice from Executive, the Company corrects, in all material respects, the events or circumstances giving rise to Executive’s claim for Non-CIC Good Reason, Executive shall not be entitled to terminate her employment for Non-CIC Good Reason by reason of such event or circumstance.

 

(e)

Payment of Compensation Earned Through Termination Date

Upon a termination of Executive’s employment hereunder for any reason, Executive or, in the event of her death, Executive’s estate, in addition to any other payments or benefits to which Executive may be entitled hereunder, is entitled to

 

 

(i)

Executive’s Base Salary prorated through the date of Separation from Service,

 

 

(ii)

any payment under the Incentive Plan for Performance Periods ending before the date of Separation from Service, unless eliminated or reduced, and then only to the extent that such payments are eliminated or reduced, for all Senior Officers continuing employment with the Company, and

 

 

(iii)

any vacation pay for vacation accrued by Executive in the calendar year of termination but not taken by the Separation from Service date.

 

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Except as otherwise provided herein, the Company must pay any other employee benefits to which Executive is entitled by reason of her employment to Executive or her estate at the time or times required by the terms of the applicable Company plan or policy.

 

(f)

Effect of Termination on Other Positions

If, on the Termination Date, Executive (i) is a member of the Board or any board of directors of one of Sprint’s subsidiaries, (ii) serves on the board of directors of any other corporation by nomination, appointment, or designation by Sprint or any of its subsidiaries, or (iii) holds any other position with Sprint or any of its subsidiaries, Executive shall, unless otherwise agreed to by the Company, be deemed to have resigned from all such positions as of the Termination Date. Executive agrees to execute such documents and take such other actions as the Company may request to reflect such resignations.

 

(g)

Condition to Certain Payments

Payments under Section 4 are conditioned on Executive’s compliance with the requirements of Section 4.03(b).

 

(h)

Exit Interview

At the Company’s request, Executive shall participate in an exit interview prior to Executive’s last day worked as an employee of the Company to provide for the orderly transition of her duties, to arrange for the return of the Company’s property, to discuss her intended new employment, and to discuss and complete such other matters as may be necessary to ensure full compliance with this Agreement.

 

2.

Compensation

Subject to the terms of this Agreement, during the Employment Term, while Executive is employed by the Company, the Company will compensate her for her services as follows:

 

2.01.

Base Salary

Executive shall receive an annual base salary in an amount not less than her annual salary on the Effective Date, payable in monthly or more frequent installments in accordance with the Company’s payroll policies and practices (such annual base salary as adjusted pursuant to this Section 2.01 shall hereinafter be referred to as the " Base Salary "). Executive’s Base Salary shall be reviewed, and may be increased but not decreased below the rate in effect on the Effective Date (other than across-the-board reductions similarly affecting all Senior Officers), by the Board in a manner that is fair and pursuant to its normal performance review policies for Senior Officers.

 

2.02.

Incentive Payments

Executive will continue to participate in the Incentive Plan, subject to its terms and conditions as they may from time to time be established, amended, interpreted, or terminated in accordance with the Company’s plans or policies governing such benefits to the Company’s Senior Officers

 

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generally. Executive’s Targeted Compensation under the Incentive Plan shall be reviewed, and may be increased but not decreased below her Targeted Compensation in effect in 2003 (other than across-the-board reductions similarly affecting all Senior Officers), by the Board in a manner that is fair and pursuant to its normal performance review policies for Senior Officers.

 

2.03.

Employee Benefits

The Company will provide Executive with the employee benefits (including, without limitation, life, disability, medical and dental insurance coverage, participation in the Company’s Deferred Compensation Plan, Savings Plan, and the Pension Plan, and other benefits generally provided to Senior Officers) that are no less favorable in the aggregate to Executive than those provided to her as of the Effective Date, subject to amendment, modification, interpretation by the Company, or termination in accordance with the Company’s plans or policies governing such benefits to Senior Officers generally.

 

2.04.

Expense Reimbursement

The Company will reimburse Executive for reasonable out-of-pocket expenses incurred and accounted for in accordance with the policies and procedures of the Company for Senior Officers generally, as they may from time to time be established, interpreted, amended, or terminated.

 

3.

Executive Covenants

 

3.01.

Principles of Business Conduct

Executive shall adhere in all respects to the Company’s Principles of Business Conduct (or any successor code of conduct) as they may from time to time be established, interpreted, amended, or terminated.

 

3.02.

Proprietary Information

Executive acknowledges that during the course of her employment she has learned or will learn or develop Proprietary Information. Executive further acknowledges that unauthorized disclosure or use of such Proprietary Information, other than in discharge of Executive’s duties, will cause the Company irreparable harm. Except in the course of her employment with the Company under this Agreement, in the pursuit of the business of the Company, or as otherwise required in employment with the Company, Executive shall not, during the course of her employment or at any time following termination of her employment, directly or indirectly, disclose, publish, communicate, or use on her behalf or another’s behalf, any Proprietary Information. If during or after her employment Executive has any questions about whether particular information is Proprietary Information she shall consult with the Company’s Corporate Secretary or other representative designated by the Company.

Executive also agrees to promptly disclose to the Company any information, ideas, or inventions made or conceived by her that result from or are suggested by services performed by her for the Company under this Agreement, and to assign to the Company all rights pertaining to such information, ideas, or inventions. Knowledge or information of any kind disclosed by Executive to the Company shall be deemed to have been disclosed without obligation on the part of the

 

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Company to hold the same in confidence, and the Company shall have the full right to use and disclose such knowledge and information without compensation to Executive beyond that specifically provided in this Agreement.

 

3.03.

Non-Competition

During Executive’s employment with the Company and during the Non-Compete Period, Executive shall not engage in Competitive Employment, whether paid or unpaid and whether as a consultant, employee, or otherwise. This provision shall not apply if, within one year following a Change in Control:

 

 

(i)

the Company terminates Executive’s employment with the Company for any reason other than for Cause or Total Disability; or

 

 

(ii)

Executive terminates her employment with the Company for CIC-Good Reason.

If Executive ceases to be employed by the Company because of the sale, spin-off, divestiture, or other disposition by the Company of a subsidiary, division, or other divested unit employing Executive, this provision shall continue to apply during the Non-Compete Period, except that Executive’s continued employment for the subsidiary, division, or other divested unit disposed of by the Company shall not be deemed a violation of this provision.

Executive agrees that because of the worldwide nature of the Company’s business, breach of this Agreement by accepting Competitive Employment would irreparably injure the Company and that, therefore, a limited geographic restriction is neither feasible nor appropriate to protect the Company’s interests.

 

3.04.

Inducement of Employees, Customers and Others

During Executive’s employment with the Company and during the Non-Compete Period, Executive shall not directly or indirectly solicit, induce, or encourage any employee, consultant, agent, or customer of the Company, or vendor or other parties doing business with the Company, to terminate their employment, agency, or other relationship with the Company or to render services for or transfer business to any Competitor, and Executive shall not initiate discussion with any such person for any such purpose or authorize or knowingly cooperate with the taking of any such actions by any other individual or entity on behalf of the Competitor.

 

3.05.

No Adverse Actions

During the Non-Compete Period, Executive shall not, without the prior written consent of the Company, in any manner, solicit, request, advise, or assist any other person to (a) undertake any action that would be reasonably likely to, or is intended to, result in a Change in Control, or (b) seek to control in any material manner the Board.

 

3.06.

Return of Property

Executive shall, upon her Termination Date, return to the Company all property of the Company in her possession, including all notes, reports, sketches, plans, published memoranda, or other

 

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documents, whether in hard copy or in electronic form, created, developed, generated, received, or held by Executive during her employment, concerning or related to the Company’s business, whether containing or relating to Proprietary Information or not. Executive shall not remove, by e-mail, by removal of computer discs or hard drives, or by other means, any of the above property containing Proprietary Information, or reproductions or copies thereof, or any apparatus from the Company’s premises without the Company’s written consent.

 

3.07.

Mutual Non-disparagement

Executive agrees to refrain from making any statements about the Company or its officers or directors that would disparage, or reflect unfavorably upon the image or reputation of the Company or any such officer or director. The Company agrees to use reasonable efforts to prevent its directors and officers from making any statements about Executive that would disparage, or reflect unfavorably upon the image or reputation of, Executive.

 

3.08.

Assistance with Claims

Executive agrees that, consistent with Executive’s business and personal affairs, during and after her employment by the Company, she will assist the Company in the defense of any claims or potential claims that may be made or threatened to be made against it in any action, suit, or proceeding, whether civil, criminal, administrative, or investigative (" Proceeding ") and will assist the Company in the prosecution of any claims that may be made by the Company in any Proceeding, to the extent that such claims may relate to Executive’s services provided under this Agreement.

Executive agrees, unless precluded by law, to promptly inform the Company if Executive is asked to participate (or otherwise become involved) in any Proceeding involving such claims or potential claims.

Executive also agrees, unless precluded by law, to promptly inform the Company if Executive is asked to assist in any investigation (whether governmental or private) of the Company (or its actions), regardless of whether a lawsuit has then been filed against the Company with respect to such investigation. The Company agrees to reimburse Executive for all of Executive’s reasonable out-of-pocket expenses associated with such assistance, including travel expenses and any attorneys’ fees and shall pay a reasonable per diem fee (equal to 1/250th of her Base Salary rate at her Termination Date) for Executive’s services within 30 days of such services.

 

3.09.

Key Man Life Insurance

The Company may, at its discretion, purchase for its own benefit and at its own expense, key man life insurance on the life of Executive. Neither Executive nor Executive’s spouse or dependents shall have any right, title, or interest in or to such insurance or the proceeds thereof. Executive agrees to cooperate with the life insurance company and the Company in the insurance underwriting process, including submitting to a physical examination and other tests necessary to secure coverage, and signing all appropriate applications and written forms as may be required by the insurance company.

 

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4.

Payments On Certain Terminations

 

4.01.

Payments on Certain Terminations Not in Connection with Change in Control

If, during the Employment Term but not within a CIC Protected Period, (a) the Company terminates Executive’s employment with the Company for any reason other than (x) Cause or (y) Executive’s Total Disability or (b) Executive terminates her employment with the Company for Non-CIC Good Reason and, in either event such termination constitutes a Separation from Service, then Executive shall, subject to Section 2.05 and the other applicable provisions of this Section 4, be entitled to the following payments and benefits (the " Non-CIC Benefits ") in lieu of any other payments or benefits available under Section 4.02 below:

 

 

(i)

The Company will pay Executive her Base Salary, at the rate in effect prior to her termination of employment, in equal bi-weekly installments on the regular payroll dates under the Company’s payroll practices applicable to Executive on the date of this Agreement for the Non-CIC Severance Period, except that (A) if the Release Consideration and Revocation Period ends on or after December 15 th of the calendar year of Executive’s Separation from Service, such installments that are otherwise payable in the year of the Executive’s Separation from Service shall be paid in a lump sum on the first business day of the following calendar year or (B) if Executive is a Specified Employee, with respect to any amount payable by reason of the Separation from Service that constitutes deferred compensation within the meaning of Section 409A of the Code, such installments shall not commence until after the end of the six continuous month period following the date of Executive’s Separation from Service, in which case, Executive shall be paid a lump-sum cash payment equal to the aggregate amount of missed installments during such period on the first day of the seventh month following the date of Executive’s Separation from Service;

 

 

(ii)

The Company will pay Executive, at the time and in the amounts set forth immediately below, Executive’s (x) bonus amount earned under the Incentive Plan for that portion of the Termination Performance Period ending on Executive’s date of Separation from Service and (y) the bonus amount under the Incentive Plan for the Non-CIC Severance Period. Such amounts shall be calculated and paid as follows:

 

 

(A)

For the Termination Performance Period, the Company will pay Executive, at the time when payouts are made for that Performance Period, an amount equal to the Non-CIC Termination Period Incentive Payout.

 

 

(B)

For the Post I Termination Performance Period, the Company will pay Executive, at the time when payouts are made for that Performance Period, an amount equal to the Capped Incentive Payout for such Performance Period or, alternatively, in the event that the Non-CIC Severance Period ends within such Performance Period, the Capped Incentive Payout for such Performance Period prorated through the month in which the Non-CIC Severance Period ends.

 

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(C)

In the event that the Non-CIC Severance Period ends in the Post II Termination Performance Period, the Company will pay Executive, at the time when payouts are made for that Performance Period, the Capped Incentive Payout for such Performance Period prorated through the month in which the Non-CIC Severance Period ends.

For purposes of Sections 4.01(ii) (B) and (C), in determining whether to count the month in which the Non-CIC Severance Period ends, if the end of the Non-CIC Severance Period falls on a date on or before the 15th of a month, such month shall not be counted but, if the end of the Non-CIC Severance Period falls on a date after the 15th of a month, such month shall be counted.

This Section 4.01(ii) assumes that Performance Periods under the Incentive Plan are 12 months in length. To the extent that Performance Periods are greater or lesser than 12 months, the above payout schedule shall be appropriately adjusted by the Company, either by increasing or decreasing the number of Performance Periods in which severance payouts shall be made, such that (i) the final payment made to Executive under this Section 4.01(ii) shall be made at the time payouts are made for the Performance Period in which the Non-CIC Severance Period ends, and (ii) Executive shall receive no less than nor no greater than the amount, using concepts and formulas consistent with those provided in this Section 4.01(ii), that would have accrued and been payable to Executive under the Incentive Plan for the Non-CIC Severance Period had the Performance Periods remained 12 months in length.

Notwithstanding anything in this Section 4.01(ii) to the contrary, each such payment shall be payable in accordance with the provisions of the Incentive Plan in the calendar year in which the Non-CIC Termination Period Incentive Payout or Capped Incentive Payout, as applicable, is determined, and in all events, not later than December 31 st of the year in which each such payout is determined.

 

 

(iii)

During the Non-CIC Severance Period, the Company will provide any employee benefit (including, but not limited to, executive medical, dental and life coverage, qualified or nonqualified retirement benefits, and other benefits generally provided to Senior Officers other than country club membership dues and accrual of vacation) that Executive was receiving or was entitled to receive as of the date of Separation from Service, except that long term-disability and short-term disability benefits shall cease on Executive’s date of Separation from Service, but if Executive becomes employed full-time during the Non-CIC Severance Period, Executive’s entitlement to continued participation in any medical, dental or other group health plan sponsored by the Company shall immediately cease, except that Executive shall retain any rights to continue coverage under the COBRA continuation provisions of such Company’s group health care plans by paying the applicable premium therefor.

 

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(iv)

During the Non-CIC Severance Period, the Company will pay for outplacement counseling by a firm selected by the Company to continue until the earlier of such time as Executive becomes re-employed or the end of the Non-CIC Severance Period; provided, however, that all such outplacement services must be completed, and all payments by the Company must be made, by December 31st of the second calendar year following the calendar year in which Executive’s Separation from Service occurs.

 

 

(v)

The end of the Non-CIC Severance Period will be treated as Executive’s termination date for purposes of the Company’s stock option and restricted stock programs.

In all events, Executive’s right to receive the Non-CIC Benefits shall cease immediately if Executive is re-employed by the Company or an affiliate of the Company or if Executive breaches the Restrictive Covenants. In all cases, the Company’s rights under Section 5 shall continue.

 

4.02.

Payments on Certain Terminations in Connection with a Change in Control

If, during the Employment Term and within a CIC Protected Period, (a) the Company terminates Executive’s employment with the Company for any reason other than (x) Cause or (y) Executive’s Total Disability, or (b) Executive terminates her employment with the Company for CIC Good Reason and in either event, such termination constitutes a Separation from Service, then Executive shall, subject to Section 2.05 and the other applicable provisions of this Section 4, be entitled to the following payments and benefits (the " CIC Benefits ") in lieu of any other payments or benefits available under Section 4.01 above:

 

 

(i)

In lieu of any further salary payments to Executive for periods after the Separation from Service date, the Company will pay Executive her Base Salary, at the rate in effect prior to her termination of employment, in equal bi-weekly installments on the regular payroll dates under the Company’s payroll practices applicable to Executive on the date of this Agreement for the CIC Severance Period, except that (A) if the Release Consideration and Revocation Period ends on or after December 15 th of the calendar year of Executive’s Separation from Service, such installments that are otherwise payable in the year of the Executive’s Separation from Service shall be paid in a lump sum on the first business day of the following calendar year or (B) if Executive is a Specified Employee, with respect to any amount payable by reason of the Separation from Service that constitutes deferred compensation within the meaning of Section 409A of the Code, such installments shall not commence until after the end of the six continuous month period following the date of Executive’s Separation from Service, in which case, Executive shall be paid a lump-sum cash payment equal to the aggregate amount of missed installments during such period on the first day of the seventh month following the date of Executive’s Separation from Service;

 

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provided, however, to the extent that Executive terminates her employment because of CIC Good Reason and a reduction in Executive’s Base Salary has occurred which constitutes CIC Good Reason under Section 6.09(ii) of this Agreement, Executive’s Base Salary for the purpose of this Section 4.02(i) shall be Executive’s Base Salary immediately prior to such Base Salary reduction.

 

 

(ii)

In lieu of any payments under, and notwithstanding any provisions of the Incentive Plan, the Company will pay Executive, at the time and in the amounts set forth immediately below, Executive’s (x) bonus amount earned under the Incentive Plan for that portion of the Termination Performance Period ending on Executive’s Separation from Service date and (y) a bonus amount equal to the amount Executive could have received under the Incentive Plan for the CIC Severance Period. Such amounts shall be calculated and paid as follows:

 

 

(A)

For the Termination Performance Period, the Company will pay Executive, at the time when payouts are made for that Performance Period, an amount equal to the CIC Termination Period Incentive Payout.

 

 

(B)

For the Post I Termination Performance Period, the Company will pay Executive, at the time when payouts are made for that Performance Period, an amount equal to Executive’s Final Targeted Compensation or, alternatively, in the event that the CIC Severance Period ends within such Performance Period, Executive’s Final Targeted Compensation prorated through the month in which the CIC Severance Period ends.

 

 

(C)

In the event that the CIC Severance Period ends during the Post II Termination Performance Period, the Company will pay Executive, at the time when payouts are made for that Performance Period, Executive’s Final Targeted Compensation prorated through the month in which the CIC Severance Period ends.

For purposes of Sections 4.02(ii) (B) and (C), in determining whether to count the month in which the CIC Severance Period ends, if the end of the CIC Severance Period falls on a date on or before the 15th of a month, such month shall not be counted but, if the end of the CIC Severance Period falls on a date after the 15 th of a month, such month shall be counted.

Notwithstanding the above and for the purpose of determining the payout amounts under Sections 4.02(ii)(B) and (C), to the extent that Executive terminates her employment because of CIC Good Reason and a reduction in Executive’s Targeted Compensation has occurred which constitutes CIC Good Reason under Section 6.09(vi) of this Agreement, Executive’s Final Targeted Compensation for purposes of Sections 4.02(ii)(B) and (C) shall be Executive’s Targeted Compensation immediately prior to such Targeted Compensation reduction.

 

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This Section 4.02(ii) assumes that Performance Periods under the Incentive Plan are 12 months in length. To the extent that Performance Periods are greater or lesser than 12 months, the above payout schedule shall be appropriately adjusted by the Company, either by increasing or decreasing the number of Performance Periods in which severance payouts shall be made, such that (i) the final payment made to Executive under this Section 4.02(ii) shall be made at the time payouts are made for the Performance Period in which the CIC Severance Period ends, and (ii) Executive shall receive no less than nor no


 
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