Exhibit 10.26


 


FIRST
AMENDMENT TO THE CHANGE IN CONTROL


EMPLOYMENT
AGREEMENT


 


This Amendment to the Change in Control
Employment Agreement (the "Amendment") is made and entered into this
17th day of December, 2008 by and between Waddell &
Reed Financial, Inc., a Delaware corporation (the "Company"),
and Henry J. Herrmann (the "Executive").


 


WITNESSETH:


 


WHEREAS, the Company
and the Executive are parties to a certain Change in Control Employment
Agreement dated as of December 14, 2001, (the "Agreement"); and


 


WHEREAS, the Company
and the Executive have agreed to make certain modifications to the Agreement to
comply with the provisions of section 409A of the Internal Revenue Code of
1986, as amended (the "Code").


 


NOW, THEREFORE, in
consideration of the premises and the mutual covenants set forth below, to
avoid adverse tax consequences under section 409A of the Code and for other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereby agree as follows:


 


1.               Section 6(f) of
the Agreement is hereby amended in its entirety to read as follows:


 


(f)            the Company shall,
at its sole expense as incurred, provide you with outplacement services, the
scope and provider of which shall be selected by you in your sole discretion,
provided that such outplacement services shall not be provided beyond the last
day of the second year following the year that includes your Date of
Termination.


 


2.               A new sentence is hereby
added to the end of Section 13 to read as follows:


 


The terms "terminate," "termination," "termination
of employment," and similar terms used herein are intended to mean a
termination of employment that constitutes the Executive's "Separation
from Service" as such term is defined in Treasury Regulation Section 1.409A-1(h).


 


3.               A new Section 17 is
hereby added to the Agreement to read as follows:


 


17.  SECTION 409A.  The terms of this Agreement shall be
construed in accordance with Section 409A of the Code.


 


(a)           If the Company is
publicly traded on an established securities market or otherwise on the
Executive's Date of Termination, any payments payable pursuant to Sections
6(b), (c), and (e) shall not be distributed prior to the day following the
six month anniversary of the Executive's Date of Termination if Executive is
deemed a "specified employee" as defined in Treasury Regulation Section 1.409A-1(i).  Any payments delayed pursuant to this
provision will be paid in a lump sum on the day following the six


 













 


month anniversary of the Executive's Date of
Termination (or, if earlier, the date of death of the "specified employee").


 


(b)           Anything herein to
the contrary notwithstanding, any payments, reimbursements or tax gross-up
payments payable pursuant to this Agreement shall be paid in accordance with
the requirements of Treasury Regulation Sections 1.409A-3(i)(1)(iv) and
(v).


 


IN WITNESS WHEREOF, the Company
and the Executive have executed this Amendment as of the date first written
above.


 


 


 


	
   

  	
  WADDELL & REED FINANCIAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Daniel P. Connealy

  
	
   

  	
   

  	
  Daniel P. Connealy

  
	
   

  	
   

  	
  Senior Vice President and Chief

  Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Henry J. Herrmann

  
	
   

  	
  Henry J. Herrmann

  



 


 


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