JCPenney 2015 Annual Report Download - page 114

1.5 Section 409A. To the extent applicable, it is intended that portions of this Agreement either comply with or be exempt
from the provisions of Section 409A of the Code (as defined in Section 2 of this Agreement). Any provision of this
Agreement that would cause this Agreement to fail to comply with or be exempt from Code section 409A shall have no
force and effect until such provision is either amended to comply with or be exempt from Code section 409A (which
amendment may be retroactive to the extent permitted by Code section 409A and the Executive hereby agrees not to
withhold consent unreasonably to any amendment requested by the Corporation for the purpose of either complying
with or being exempt from Code section 409A).
1.6 Enforcement and Forfeiture. Notwithstanding the foregoing provisions of this Section 1, in addition to any remedies to
which the Corporation is entitled, any right of the Executive to receive termination payments and benefits under
Section 1 shall be forfeited to the extent of any amounts payable or benefits to be provided after a breach of any
covenant set forth in Section 3. On the Company’s becoming aware that the Executive has breached, or potentially has
breached, any covenant set forth in Section 3 of this Agreement, the Corporation shall suspend all future installment
payments under Section 1.4(a) of this Agreement and may seek recoupment of all amounts previously paid to the
Executive under Section 1.4(a) this Agreement. The forfeiture or recoupment of any equity awards that are subject to
covenants like those contained in Section 3 of this Agreement shall be governed by the terms of the applicable equity
award agreement containing such covenants.
1.7 Non-Eligibility For Management Incentive Compensation Program benefits and Other Company Separation Pay
Benefits. The benefits provided for herein are intended to be in lieu of, and not in addition to, benefits under the
Management Incentive Compensation Program the Executive could earn with respect to any incentive compensation or
bonus program in place for the fiscal year in which the Executive’s Involuntary Separation from Service other than for
Cause occurs or other separation pay benefits to which the Executive might be entitled, including those under the
Corporation’s Separation Pay Plan, or any successor plan or program offered by the Corporation, which the Executive
hereby waives. If the Executive receives benefits under the Corporation’s Change in Control Plan (the “CIC Plan”), in
the event of Employment Termination (as defined in the CIC Plan), the covenants set forth in Section 3 hereof shall
automatically terminate and, if the Executive shall receive all benefits to which the Executive is entitled under the CIC
Plan, the Executive waives all benefits hereunder.
1.8 Corporation’s Right of Offset. If the Executive is at any time indebted to the Corporation, or otherwise obligated to pay
money to the Corporation for any reason, to the extent exempt from or otherwise permitted by Code section 409A and
the Treasury Regulations thereunder, including Treasury Regulation section 1.409A-3(j)(4)(xiii) or any successor
thereto, the Corporation, at its election, may offset amounts otherwise payable to the Executive under this Agreement,
including, but without limitation, Base Salary and incentive compensation payments, against any such indebtedness or
amounts due from the Executive to the Corporation, to the extent permitted by law.
1.9 Mitigation. In the event of the Involuntary Separation from Service of the Executive, the Executive shall not be required
to mitigate damages by seeking other employment or otherwise as a condition to receiving termination payments or
benefits under this Agreement. No amounts earned by the Executive after the Executive’s Involuntary Separation from
Service,