Summary
Cardinal Health, Inc. (CAH) has filed an 8-K report detailing the adoption of a new Senior Executive Severance Plan, effective October 1, 2018. This plan is designed to provide specific severance benefits to a select group of senior executives, including the CEO, CFO, CEO of the Medical Segment, and Chief Legal and Compliance Officer, in the event of a qualifying termination of employment. The plan outlines compensation packages triggered by termination without cause, or resignation for good reason during a change of control period, offering multiples of salary and target bonus, prorated bonuses, and continued health insurance premiums.
Key Highlights
- 1Cardinal Health established a Senior Executive Severance Plan effective October 1, 2018.
- 2The plan covers key named executive officers, including the CEO, CFO, CEO of the Medical Segment, and Chief Legal and Compliance Officer.
- 3Severance benefits are triggered by termination without cause, or by resignation for good reason during a change of control period.
- 4Benefits include cash severance calculated as a multiple of annual base salary and target annual bonus (ranging from 1.5x to 2.5x).
- 5The plan also includes prorated annual bonuses, unpaid prior year bonuses, and up to 18 months of health insurance premium payments.
- 6Eligible executives are subject to restrictive covenants, including confidentiality, non-disparagement, and for named executive officers, non-competition and non-solicitation for two years post-termination.