Document:

Exhibit 10.1

 

SEVERANCE AGREEMENT 

 

THIS SEVERANCE AGREEMENT is
made as of the 26th day of September, 2013, between SCHOLASTIC CORPORATION, a Delaware corporation with its principal
offices at 557 Broadway, New York, NY 10012 (the “Company”), and Maureen O’Connell (“Executive”), residing
at 154 Weaver Street, Greenwich, CT 06831.

 

WITNESSETH THAT:

 

WHEREAS, this Agreement is intended to
specify the financial arrangements that the Company will provide to Executive upon Executive’s separation from employment with
the Company and all subsidiaries of the Company under any of the circumstances described herein.

 

NOW, THEREFORE, to assure the Company
that it will have the continued dedication of Executive notwithstanding the possibility or occurrence of any of the events specified
herein, and to induce Executive to remain in the employ of the Company, and for other good and valuable consideration, the Company
and Executive agree as follows:

 

1. Termination of Employment.

 

(a) The Company shall have the right to
terminate Executive from employment with the Company at any time for “Cause” (as hereinafter defined), by written notice
to Executive specifying the particulars of the conduct of Executive forming the basis for such termination, such termination to
be effective on the 30th day following receipt of the notice by Executive if Executive has not cured the conduct (if subject to
a cure) identified in such notice to the Company’s reasonable satisfaction.

 

(b) The Company shall have the right to
terminate Executive’s employment without Cause at any time, and Executive shall have the right to terminate her employment for
“Good Reason” (as hereinafter defined) within the six month period following the first occurrence of a Good Reason event
pursuant to Section 2(a), if the Company shall not have cured the Good Reason event within the time period set forth in Section
2(a), and, upon any such termination, Executive shall be entitled to the benefits provided in Section 4(a).

 

2. Definitions.

 

(a) “Good Reason” shall
mean the occurrence of any of the following events, without the consent of Executive, provided that Executive has provided written
notice to the Company within ninety (90) days of the first occurrence of such event and the Company has failed to cure (if the
event or circumstance is subject to cure) such event within thirty (30) days after the date of such written notice:

 

(i) a material diminution of Executive’s
title (currently, Executive Vice President/Chief Administrative Officer/Chief Financial Officer), authority, employment duties
or responsibilities, which shall include but not be limited to a material diminution in Executive’s direct report authority (by
way of example only, a removal of a department, a change from sole direct report authority over a department to sharing such direct
report authority, or the removal or reassignment of a significant number of individuals over whom the Executive has direct authority
unless Executive agrees in writing to such changes);

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(ii) a material reduction
by the Company in Executive’s base salary or target bonus opportunity or in other benefits customarily made available to the most
senior executive officers of the Company (other than the Chief Executive Officer); provided, however, that if substantially similar
changes are contemporaneously made to the base salaries, target bonus opportunities or benefits of all of the most senior executive
officers of the MEC of the Company (other than the Chief Executive Officer) such changes shall not be considered “Good Reason”;

 

(iii) Executive no
longer reports directly and solely to Richard Robinson as the Chief Executive Officer of the Company, or Richard Robinson ceases
to be the Chief Executive Officer of the Company or

 

(iv) a material change
in the geographic location of Executive’s employment.

 

(b)
“Cause” shall mean termination by the Company of Executive’s employment based upon any of the following:

 

(i) conviction of a felony or a crime involving
moral turpitude;

 

(ii) acts constituting gross negligence or willful
malfeasance in the performance of her duties;

 

(iii) material
failure to comply with the Company’s Code of Ethics or other material written policies or procedures; or

 

(iv) material failure, or refusal,
to perform duties assigned or designated to the Executive by the Board of Directors (or any committee thereof) or the Chief Executive
Officer of the Company, provided such duties are within the scope of a Chief Administrative or Chief Financial Officer.

 

The
30 day cure period provided by Section 1(a) shall apply to Sections 2(b)(ii), (iii) and (iv).

 

3. Payment of Wages,
Earned Bonus and Benefits Through the Employment Termination Date. No later than the next regular payroll date following any
termination of Executive’s employment pursuant to Section 1(b), the Company shall pay to Executive (i) her full base salary
owed through the date that the termination of Executive’s employment becomes effective (the “Employment Termination Date”),
(ii) any bonus declared but unpaid with respect to the last completed fiscal year of the Company preceding the Employment Termination
Date, notwithstanding that the date on which such bonuses are normally paid to employees is after the Employment Termination Date,
and (iii) an amount representing credit for any vacation earned or accrued by Executive but not taken. If, as of the Employment
Termination Date, bonuses have not yet been declared by the Company with respect to the last completed fiscal year of the Company
preceding the Employment Termination Date, any such bonus earned by Executive as a result of the established bonus plan targets
being achieved shall be paid to Executive within thirty (30) days of the date such bonus is declared. The rates at which payments
required under this Section 3 shall be calculated shall be at the rates in effect at the time written notice of termination (by
the Company other than for cause or by Executive for Good Reason) is given, unless termination is pursuant to Section 2(a)(ii),
then at the rates in effect immediately prior to the reduction in base salary, target bonus opportunity or benefits.

 

4. Benefits upon Termination.

 

(a) Upon the termination of the employment
of Executive pursuant to Section l(b) hereof, Executive shall be entitled to receive all of the benefits specified in this Section
4(a) as follows:

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(i) In lieu of any further base salary,
bonus payments or any other compensation or benefits payable to Executive for periods subsequent to Executive’s Employment Termination
Date, and in full satisfaction of any claims for compensation or other benefits payable to her of any kind or nature before or
after the Employment Termination Date (other than benefits payable to Executive under the Company’s Cash Balance Retirement
Plan and the Company’s 401(k) Retirement Savings and Plan), the Company shall pay as severance pay to Executive (a “Severance
Payment”) a lump-sum cash amount equal to (x) thirty-three (33) times Executive’s monthly base salary, plus (y) an amount
equal to Executive’s target bonus for the fiscal year in which the Employment Termination Date occurs (the “Target Bonus”),
multiplied by a fraction, the numerator of which is equal to the number of full months in the year in which Executive’s employment
is terminated that have elapsed at the Employment Termination Date, and the denominator of which is twelve (12), provided that
the Company’s performance criteria for the fiscal year are met on a pro-forma basis (using the Company’s actual performance through
the end of the last full month prior to the Employment Termination Date and the Company’s latest internal projections for the remainder
of the fiscal year for purposes of this determination), plus (z) an amount equal to the cost, as of the Employment Termination
Date, to Executive to purchase coverage providing for the continuation of medical benefits provided by the Company to Executive
and her family for a one year period under the federal law known as COBRA. The rates at which payments required under this Section
4(a)(i) shall be calculated shall be at the rates in effect at the time written notice of termination (by the Company other than
for Cause or by Executive for Good Reason) is given, unless termination is pursuant to Section 2(a)(ii), then at the rates in effect
immediately prior to the reduction in base salary, target bonus opportunity or benefits.

 

(ii) The Company shall
also pay to Executive all reasonable legal fees and expenses incurred by Executive as a result of such termination of employment
(including but not limited to all reasonable fees and expenses, if any, incurred by Executive in the review and negotiation of
the Release of Claims (as defined in Section 4(a)(iv) below) and in seeking to obtain or enforce any right or benefit provided
to Executive by this Agreement).

 

(iii) Notwithstanding
any other agreement in existence between the Company and Executive, upon the Employment Termination Date all stock options or shares
of restricted stock, restricted stock units or performance shares granted to Executive under the Scholastic Corporation Stock Incentive
Plan of 2001, as amended, or Stock Incentive Plan of 2011, as amended, or otherwise owned or held by Executive (including but not
limited to that purchased under the Management Stock Purchase Plan or any other plan or agreement) that were not vested as of the
Employment Termination Date shall be immediately vested in Executive without further restriction (collectively the “Accelerated
Equity Awards”). Executive shall be treated at that time as the unrestricted owner of such Company stock options and stock,
subject to applicable constraints under federal and state securities laws. Restricted stock units that vest pursuant to this provision
shall convert into stock as of the Employment Termination Date. As to all stock options vested as of the Employment Termination
Date, as well as stock options that vest pursuant to this provision, Executive shall be entitled to exercise such stock options
within ninety (90) days of the Employment Termination Date or any longer period of time provided under such plans or agreements
as they pertain to an involuntary termination, but in no event beyond the expiration of the stated term of such stock options.
All existing and future restricted stock unit agreements and stock option agreements in existence between the Company and Executive
are hereby modified to or shall incorporate this provision.

 

(iv) The amounts due to Executive under
subparagraph (i) of Section 4(a) shall be paid to Executive not later than the thirtieth (30th) business day following the Employment
Termination Date, provided that (x) Executive has signed a general “Release of Claims” against the Company in such
form and manner reasonably prescribed by the Company, (y) any revocation period to which Executive is entitled by

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law has expired before the end of the 30 business day period
and (z) if the 30 business day period begins in one taxable year and ends in the second taxable year, the payment shall be made
in the second taxable year. The Company shall deliver to Executive the Company’s form of Release of Claims sufficiently before
the date for payment specified in this subparagraph, such that Executive is afforded such time as may be required by applicable
statute or regulation to consider whether to sign the Release of Claims and whether to revoke or rescind such Release of Claims.

 

(v) All benefits and payments to Executive
pursuant to this Section 4 shall be subject to any applicable income, payroll or other taxes required by law to be withheld.

 

(vi) For the avoidance
of doubt, Executive shall not be entitled to the benefits provided in this Section 4 with respect to any termination by Executive
that is not described in Section 1(b) or in the event that Executive’s employment shall terminate on account of death or
disability.

 

5. Certain Covenants.
(a) In consideration of the Company entering into this Agreement, Executive agrees for the benefit of the Company and its affiliates,
as follows:

 

(i) Non-Disclosure of Confidential Information.
Executive acknowledges that Executive has had or will have access to and gain knowledge of highly confidential or proprietary information
or trade secrets pertaining to the Company or its affiliates, as well as the customers, suppliers, licensors, licensees, distributors
or other persons and entities with whom the Company or any of its affiliates does business (“Confidential Information”),
that this information was obtained or developed by the Company or its affiliates at great expense and is zealously guarded by the
Company and its affiliates from unauthorized disclosure and that Executive’s possession of this special knowledge is due
solely to Executive’s employment with the Company. In recognition of the foregoing, and in addition to any other obligations
which Executive may have not to disclose Confidential Information, Executive will not, without the prior written consent of the
Company, at any time following any termination of her employment pursuant to Section 1(b), disclose, use or otherwise make available
to any third party any Confidential Information, including that relating to the Company’s or any affiliate’s business,
products, services, customers, vendors or suppliers; trade secrets, data, specifications, developments, inventions and research
activity; marketing and sales strategies, information and techniques; long and short term plans; existing and prospective client,
vendor, supplier and employee lists, contacts and information; financial, personnel and information system information and applications;
and any other information concerning the business of the Company or its affiliates which is not disclosed to the general public,
or generally known in the industry, except for disclosure (x) required pursuant to Court or governmental order, lawful subpoena
or otherwise by law, or (y) to Executive’s tax advisors or legal counsel who have agreed to maintain the confidentiality
thereof. Confidential information does not include any information which was rightfully known by Executive prior to working for
the Company or becomes generally available to the public through no fault of Executive. In the event Executive becomes or may become
legally compelled to disclose any Confidential Information (whether by deposition, interrogatory, request for documents, subpoena,
civil investigative demand or other process or otherwise), Executive shall provide to the Company prompt prior written notice of
such requirement so that the Company may seek a protective order or other appropriate remedy. In the event that such protective
order or other remedy is not obtained, Executive shall furnish only that portion of the Confidential Information which she is advised
by counsel is legally required to be disclosed, unless otherwise ordered and in that event, only to the extent ordered, and shall
reasonably cooperate with the Company in its efforts to insure that confidential treatment shall be afforded such disclosed portion
of the Confidential Information.

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(ii) Return of Property. By no later
than the Employment Termination Date, Executive shall deliver to a designated Company representative all Confidential Information,
including all copies, notes regarding and replications of such Confidential Information, as well as all records, documents, hardware,
software and all other property of the Company or its affiliates and all copies of such property, in Executive’s possession
in any media, including passwords and codes needed to obtain access or operate any device. Executive shall not retain any copies,
duplicates, reproductions or excerpts in any form whatsoever. Executive acknowledges and agrees that all such materials are the
sole property of the Company or its affiliates and that Executive will certify in writing to the Company at the time of delivery
that Executive has complied with this obligation.

 

(iii) Non-Solicitation of Employees.
Executive specifically acknowledges that the Confidential Information described in Section 5(a) also includes confidential data
pertaining to employees and agents of the Company or its affiliates, and, in addition to any other obligations which Executive
may have regarding non-solicitation of employees, Executive further agrees that for twelve (12) months following any termination
of her employment pursuant to Section 1(b), Executive will not, without the prior written consent of the Company, directly or indirectly,
on Executive’s own behalf or on behalf of any other person or entity, solicit, contact, approach, encourage, induce or attempt
to solicit, contact, approach, encourage or induce any of the employees or agents of the Company or its affiliates to terminate
their employment or agency with the Company or any of its affiliates.

 

(b) No Disparaging
Statements. In consideration of the parties entering into this Agreement, Executive and the Company agree for the benefit of
the Company and its affiliates and Executive, as the cases may be, that, from and after any termination of Executive’s employment
pursuant to Section 1(b), (i) the Company and/or the Chief Executive Officer will not make, and agree to use their reasonable best
efforts to cause the Company’s executive officers, directors and spokespersons of the Company to refrain from making, any
public statements (or authorizing any statements to be reported as being attributed to the Company), that are critical, derogatory
or which may tend to injure the image, reputation or business of Executive or impugn the character, integrity or ethics of Executive,
and (ii) Executive agrees to refrain from making any public statements (or authorizing any statements to be reported as being attributed
to Executive) that are critical, derogatory or which may tend to injure the image, reputation or business of the Company and its
management or impugn the character, integrity or ethics of the Company and its management. Executive’s resignation from the
Company shall be announced in a notice to employees of the Company and a press release. The Company agrees to consult with Executive
about the contents of the press release as it affects Executive; provided, however, that the Company shall make such statements
and disclosures to regulatory authorities concerning Executive’s employment, including the severance and other financial
arrangements between Executive and the Company, as may be required in the sole judgment of the Company.

 

(c) Remedies for Breach of These Covenants.
Any breach of the covenants in this Section 5 likely will cause irreparable harm to the Company or its affiliates or Executive,
as the case may be, for which money damages could not reasonably or adequately compensate. Accordingly, the Company or any of its
affiliates or Executive, as the case may be, shall be entitled to seek injunctive relief (whether temporary, emergency, preliminary,
prospective or permanent) to enforce such covenants, in addition to damages and other available remedies, and Executive and the
Company consent to the issuance of such an injunction without the necessity of the Company or any of its affiliates or Executive
posting a bond. In the event that injunctive relief or damages are awarded for any breach of this Section 5, Executive and the
Company further agree that the Company and its affiliates or Executive, as the case may be, shall be entitled to recover its or
her costs and attorneys’ fees necessary to obtain such recovery. In addition, Executive agrees that upon Executive’s
breach of any covenant in this Section 5, all unexercised options issued under any

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stock option plans of the Company will immediately terminate
and the Company shall have the right to exercise any and all of the rights described above.

 

(d) Conditions and Limitations.

 

	 	(i)	Executive’s obligation to comply with subsection 5(a)(iii) is contingent upon
Company’s compliance in all material respects with its payment and other obligations pursuant to this Agreement;
		(ii)	Subject to Section 5(d)(i), Executive’s compliance with Section 5 is a material condition to her receipt of benefits
described in Section 4 of this Agreement; and
		(iii)	Nothing in this Section 5 shall be interpreted to preclude Executive from working for a competitor of Company and/or its affiliates.
Engaging in ordinary business practices competitive with Company or its affiliates shall not be deemed a violation of Section 5
provided that Executive is not in breach of subsection 5(a)(i) in engaging in such practices.

 

6. Reimbursement
of Attorneys’ Fees. The Company shall reimburse Executive for reasonable attorneys’ fees and costs incurred by
Executive in the review, negotiation and preparation of this Agreement.

 

7. Assignment;
Successors.

 

(a) This Agreement is personal to Executive,
and Executive may not assign or transfer any part of her rights or duties hereunder, or any compensation due to her hereunder,
to any other person. Notwithstanding the foregoing, this Agreement shall inure to the benefit of and be enforceable by Executive’s
personal or legal representatives, executors, administrators, heirs, distributees, devisees and legatees.

 

(b) For all purposes under this Agreement,
the term “Company” shall include any successor to all or substantially all of the Company’s business and/or assets or
which becomes bound by the terms of this Agreement by operation of law.

 

8. Modification; Waiver. No provisions
of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in a writing
signed by Executive and the Company. No waiver by either party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar
or dissimilar provisions or conditions at the same or at any prior or subsequent time.

 

9. Notice. All notices, requests,
demands and all other communications required or permitted by either party to the other party by this Agreement (including, without
limitation, any notice of termination of employment) shall be in writing and shall be deemed to have been duly given when delivered
personally or received by certified or registered mail, return receipt requested, postage prepaid, at the address of the other
party, as first written above (directed to the attention of the Board of Directors and Corporate Secretary in the case of the Company).
Either party hereto may change its address for purposes of this Section 9 by giving 15 days’ prior notice to the other party hereto.

 

10. Severability. If any term or provision
of this Agreement or the application hereof to any person or circumstances shall to any extent be invalid or unenforceable, the
remainder of this Agreement or the application of such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable shall not be affected thereby, and each term and provision of this Agreement shall be valid
and enforceable to the fullest extent permitted by law.

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11. Counterparts. This Agreement may
be executed in several counterparts, each of which shall be deemed an original, but all of which together shall constitute one
and the same instrument.

 

12. Governing Law. This Agreement
has been executed and delivered in the State of New York and shall in all respects be governed by, and construed and enforced in
accordance with, the laws of the State of New York.

 

13. Headings; Effect of Agreement; Entire
Agreement. The descriptive headings in this Agreement are inserted for convenience only and do not constitute a part of this
Agreement. The Company and Executive understand and agree that this Agreement is intended to reflect their agreement only with
respect to payments and benefits upon termination in certain cases and is not intended to create any obligation on the part of
either party to continue employment. This Agreement supersedes any and all other oral or written agreements or policies made relating
to the subject matter hereof and constitutes the entire agreement of the parties relating to the subject matter hereof; provided
that, except as specifically set forth in Section 4(a)(iii), this Agreement shall not supersede or limit in any way Executive’s
rights under any benefit plan, program or arrangements in accordance with their terms.

 

14. 280G Cap. (a) Upon the Company’s
termination of Executive without Cause or the Company’s receipt of notice from Executive pursuant to Section 2(a) of the
occurrence of a Good Reason Event, either of which follows a change in ownership or control of the Company for purposes of Section
280G of the Internal Revenue Code, as amended (the “Code”), the Company shall cause its independent auditors and/or
tax counsel (selected by the Company but reasonably acceptable to Executive) to promptly review and determine, at the Company’s
sole expense, whether any of the Total Payments (as defined in Section 14 (b) below) constitute “parachute payments”
within the meaning of Section 280G of the Code and would, but for this Section 14, be subject to the excise tax imposed by Section
4999 of the Code (or any successor provision thereto), or any interest or penalties with respect to such tax, by reason of being
“contingent on a change in ownership or control” of the Company, within the meaning of Section 280G of the Code (or
any successor provision thereto) or to any similar tax imposed by state or local law, or any interest or penalties with respect
to such excise tax (such excise tax, together with interest and penalties, are hereafter collectively referred to as the “Excise
Tax”). If so, the Total Payments shall be reduced to the amount that is One Dollar ($1.00) less than the smallest sum that
would subject Executive to the Excise Tax; provided, however, that the Company and Executive agree to work together in good faith
to consider amendments to this Agreement and to take such reasonable actions which are necessary, appropriate or desirable to avoid
imposition of any additional tax or income recognition prior to actual payment to Executive under Section 280G.

 

(b) As used herein, “Total Payments”
shall mean, collectively, any payment or benefit received or to be received by Executive in connection with a Good Reason Event
following a change in ownership or control of the Company or termination of Executive’s employment (whether payable pursuant
to the terms of this Agreement or any other plan, contract, agreement or arrangement with the Company, with any person whose actions
result in a change in ownership or control of the Company or with any person constituting a member of an “affiliated group”
as defined in Section 280G(d)(5) of the Code) with the Company or with any person whose actions result in a change in ownership
or control of the Company; provided however, for purposes of calculating Total Payments, (i) no portion of the Total Payments the
receipt or enjoyment of which Executive shall have effectively waived in writing prior to the date of payment of the Severance
Payment shall be taken into account; (ii) no portion of the Total Payments shall be taken into account which in the written opinion
of tax counsel selected by the Company and acceptable to Executive does not constitute a “parachute payment” within
the meaning of Section 280G(b)(2) of the

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Code; (iii) the value of any benefit provided by Section 4(a)(iii)
of this Agreement with respect to Accelerated Equity Awards shall, to the extent required by Section 280G of the Code, be taken
into account in computing Total Payments; and (iv) the value of any other non-cash benefit or of any deferred cash payment included
in the Total Payments shall be determined by the Company’s independent auditors in accordance with the principles of Sections
280G(d)(3) and (4) of the Code.

 

Any determinations required under Sections
14 and 15 shall be made in writing in good faith by the Company’s auditors and/or tax counsel, at the Company’s sole
expense, which writings shall include a detailed explanation for such determinations and/or supporting calculations to the Company
and Executive as requested by the Company or the Executive.

 

15. Section 409A. (a) The parties
intend that all payments and benefits under this Agreement comply with Section 409A of the Code and the regulations promulgated
thereunder (collectively “Section 409A”) and, accordingly, to the maximum extent permitted by law, this Agreement shall
be interpreted in a manner in compliance therewith. The Company and Executive agree to work together in good faith to consider
amendments to this Agreement and to take such reasonable actions which are necessary, appropriate or desirable to avoid imposition
of any additional tax or income recognition prior to actual payment to Executive under Section 409A. To the extent that any provision
hereof is modified in order to comply with Section 409A, such modification shall be made in good faith and shall, to the maximum
extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company of the applicable provision
without violating the provisions of Section 409A.

 

(b) No amount of nonqualified deferred compensation
under Section 409A shall be payable upon a termination of Executive’s employment unless such termination constitutes a “separation
from service” with the Company under Section 409A. To the maximum extent permitted by applicable law, amounts payable to
Executive shall be made in reliance upon the exception for certain involuntary terminations under a separation pay plan or as a
short-term deferral under Section 409A. To the extent any amounts payable upon Executive’s separation from service are nonqualified
deferred compensation under Section 409A, and if Executive is at such time a “specified employee”, then to the extent
required under Section 409A payment of such amounts shall be postponed until six (6) months following the date of Executive’s
separation from service (or until any earlier date of Executive’s death), upon which date all such postponed amounts shall
be paid to Executive in a lump sum. The determination of whether Executive is a specified employee at the time of Executive’s
separation from service shall be made in good faith by the Company in accordance with Section 409A.

 

(c) To the extent that reimbursements or
other in-kind benefits under this Agreement constitute nonqualified deferred compensation, (i) all expenses or other reimbursements
hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were
incurred by Executive, (ii) any right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for
another benefit, and (ii) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable
year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable
year.

 

(d) For purposes of Section 409A, Executive’s
right to receive installment payments pursuant to this Agreement shall be treated as a right to receive a series of separate and
distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days, the actual
date of payment within the specified period shall be within the sole discretion of the Company. Any other provision of this Agreement
to the contrary notwithstanding, in no event shall any payment or benefit under this Agreement that constitutes nonqualified deferred
compensation for purposes of Section 409A be subject to offset by any other amount unless otherwise permitted by Section 409A.

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IN WITNESS WHEREOF,
the Company has caused this Agreement to be executed in its name by a duly authorized officer, and Executive has hereunto set her
hand, all as of the date first written above.

 

	 	SCHOLASTIC CORPORATION	 
	 	 	 	 
	 	By: 	/s/ Richard Robinson	 
	 	Name: Richard Robinson 	 
	 	Title: Chairman, President and	 
	 	Chief Executive Officer 	 
	 	Date: September 26, 2013 	 
	 	 	 	 
	 	EXECUTIVE 	 
	 	 	 	 
	 	/s/ Maureen O’Connell	 
	 	Maureen O’Connell	 
	 	Date: September 26, 2013	 

    	9Exhibit 10.2

 

SCHOLASTIC CORPORATION

2013 EXECUTIVE PERFORMANCE INCENTIVE PLAN

 

1.        Purpose

 

The purpose of this Plan is to attract, retain,
and motivate key employees by providing annual cash performance awards to designated key employees of the Company and its Affiliates.
This Plan is intended to establish a clear link between performance and the level of awards paid to such designated key employees
with a focus on overall corporate growth and performance as well as on group, divisional or unit growth and performance. This Plan
is effective as of July 17, 2013, subject to approval by the stockholders of the Company entitled to vote thereon in accordance
with the laws of the State of Delaware.

 

2.        Definitions

 

Unless the context otherwise requires, the
words which follow shall have the following meaning:

 

(a)        “Affiliate”—shall
mean each corporation that is a member of the Company’s affiliated group, within the meaning of Code Section 1504 (without
regard to Code Section 1504(b)) other than any subsidiary of the Company that is itself a publicly held corporation, and subsidiaries
of such public corporation, as such term is defined in Code Section 162(m) and the Treasury regulations issued thereunder.

 

(b)        “Award”—shall
mean the total annual Performance Award as determined under the Plan.

 

(c)        “Board”—shall
mean the Board of Directors of the Company.

 

(d)        “Change
in Control of the Company”—shall have the meaning set forth in the Participant’s employment agreement (if any)
or other written agreement with the Company or an Affiliate with respect to the Plan. If a Participant does not have an employment
agreement or other written agreement which defines Change in Control, the provisions of the Plan with respect to a Change in Control
shall not apply to such Participant.

 

(e)        “Code”—shall
mean the Internal Revenue Code of 1986, as amended, and any successor thereto.

 

(f)        “Code
Section 162(m)”—shall mean the exception for performance-based compensation under Section 162(m) of the Code or any
successor section and the Treasury regulations promulgated thereunder.

	 

    	

    

(g)        “Company”—shall
mean Scholastic Corporation and any successor by merger, consolidation or otherwise.

 

(h)        “Committee”—shall
mean the Human Resources and Compensation Committee of the Board (or subcommittee thereof) or such other Committee of the Board
that is appointed by the Board all of whose members shall be “outside directors,” as defined under Code Section 162(m).

 

(i)        “Individual
Target Award”—shall mean the targeted performance award for a Plan Year specified by the Committee as provided in Section
5 hereof.

 

(j)        “Participant”—shall
mean an employee of the Company or any of its Affiliates selected, in accordance with Section 4 hereof, to be eligible to receive
an Award in accordance with this Plan.

 

(k)       “Performance
Award”—shall mean the amount paid or payable under Section 6 hereof.

 

(l)        “Plan”—shall
mean this Scholastic Corporation 2013 Executive Performance Incentive Plan.

 

(m)      “Plan
Year”—shall mean the fiscal year of the Company.

 

3.        Administration
and Interpretation of the Plan

 

The Plan shall be administered by the Committee.
The Committee shall have the exclusive authority and responsibility to: (i) interpret the Plan; (ii) approve the designation of
eligible Participants; (iii) set the performance criteria for Awards within the Plan guidelines; (iv) certify attainment of performance
goals and other material terms; (v) reduce Awards as provided herein; (vi) authorize the payment of all benefits and expenses of
the Plan as they become payable under the Plan; (vii) adopt, amend and rescind rules and regulations relating to the Plan; and
(viii) make all other determinations and take all other actions necessary or desirable for the Plan’s administration, including,
without limitation, correcting any defect, supplying any omission or reconciling any inconsistency in this Plan in the manner and
to the extent it shall deem necessary to carry this Plan into effect, but only to the extent any such action would be permitted
under Code Section 162(m).

 

Decisions of the Committee shall be made
by a majority of its members. All decisions of the Committee on any question concerning the selection of Participants and the interpretation
and administration of the Plan shall be final, conclusive, and binding upon all parties. The Committee may rely on information,
and consider recommendations, provided by the Board or the senior management of the Company. The Plan is intended to comply with

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Code Section 162(m), and all provisions contained herein shall
be limited, construed, and interpreted in a manner to so comply.

 

4.        Eligibility
and Participation

 

(a)        For
each Plan Year, the Committee shall select, in its discretion, key employees of the Company or any of its Affiliates who are to
participate in the Plan.

 

(b)        No
person shall be entitled to any Award under this Plan for any Plan Year unless he or she is so designated as a Participant for
that Plan Year. The Committee may add to or delete individuals from the list of designated Participants at any time and from time
to time, in its sole discretion, subject to any limitations required to comply with Code Section 162(m).

 

5.        Individual
Target Award

 

For each Participant for each Plan Year,
the Committee may specify a targeted performance award. The Individual Target Award may be expressed, at the Committee’s
discretion, as a fixed dollar amount, a percentage of base pay or total pay (excluding payments made under this Plan), or an amount
determined pursuant to an objective formula or standard. Establishment of an Individual Target Award for an employee for a Plan
Year shall not imply or require that the same level of Individual Target Award (if any such award is established by the Committee
for the relevant employee) be set for any subsequent Plan Year. At the time the Performance Goals are established (as provided
in subsection 6.2 below), the Committee shall prescribe a formula to determine the percentages (which may be greater than one-hundred
percent (100%)) of the Individual Target Award which may be payable based upon the degree of attainment of the Performance Goals
during the Plan Year. Notwithstanding anything else herein, the Committee may, in its sole discretion, elect to pay a Participant
an amount that is less than the Participant’s Individual Target Award (or attained percentage thereof) regardless of the
degree of attainment of the Performance Goals; provided that no such discretion to reduce an Award earned based on achievement
of the applicable Performance Goals shall be permitted for the Plan Year in which a Change in Control of the Company occurs, or
during such Plan Year with regard to the prior Plan Year if the Awards for the prior Plan Year have been earned but have not been
paid by the time of the Change in Control of the Company, with regard to individuals who were Participants at the time of the Change
in Control of the Company; and further provided that no such discretion to reduce an Award otherwise payable to a Participant shall
result in an increase in an Award payable to another Participant.

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6.        Performance
Award Program

 

6.1        PERFORMANCE
AWARDS. Subject to Section 7 herein, each Participant is eligible to receive up to the achieved percentage of their Individual
Target Award for such Plan Year (or, subject to Section 5, such lesser amount as determined by the Committee in its sole discretion)
based upon the attainment of the objective Performance Goals established pursuant to subsection 6.2 and the formula or standard
established pursuant to Section 5. Except as specifically provided in Section 7, no Performance Award shall be paid to a Participant
for a Plan Year unless the minimum Performance Goals for such Plan Year are attained.

 

6.2        OBJECTIVE
PERFORMANCE GOALS, FORMULAE OR STANDARDS (THE “PERFORMANCE GOALS”). The Committee shall establish the objective performance
goals, formulae or standards and the Individual Target Award applicable to each Participant or class of Participants for a Plan
Year in writing prior to the beginning of such Plan Year or at such later date as permitted under Code Section 162(m) and while
the outcome of the Performance Goals are substantially uncertain. Such Performance Goals may incorporate, if and only to the extent
permitted under Code Section 162(m), provisions for disregarding (or adjusting for) changes in accounting methods, corporate transactions
(including, without limitation, dispositions and acquisitions) and other similar type events or circumstances. To the extent any
such provision would create impermissible discretion under Code Section 162(m) or otherwise violate Code Section 162(m), such provision
shall be of no force or effect. These Performance Goals shall be based on one or more of the following criteria with regard to
the Company or any of its Affiliates (or a group, division, operational unit or administrative department of the Company or any
of its Affiliates): (i) earnings per share or the attainment of a specified percentage increase in earnings per share or earnings
per share from continuing operations; (ii) performance measured by revenues, net profit, net income, operating income or any combination
of any or all of the foregoing (any or all of which may be measured without regard to extraordinary items); (iii) the attainment
of a certain level of, reduction of, or other specified objectives with regard to limiting the level of or increase in, all or
a portion of controllable expenses or costs or other expenses or costs; (iv) the attainment of certain target levels of, or a specified
percentage increase in, revenues, income before income taxes and extraordinary items, net income, earnings before income tax, earnings
before interest, taxes, depreciation and amortization, or a combination of any or all of the foregoing; (v) the attainment of certain
target levels of, or a percentage increase in, after-tax or pre-tax profits including, without limitation, that attributable to
continuing and/or other operations; (vi) the attainment of certain target levels in the fair market value of the shares of the
Company’s common stock; (vii) the growth in the value of an investment in the Company’s common stock assuming the reinvestment
of dividends; (viii) the attainment of certain target levels of, or a specified increase in, return on capital employed or return
on invested capital; (ix) the attainment of certain target levels of, or a percentage increase in, after-tax or pre-tax return
on stockholders’ equity; (x) the attainment of certain target levels

	4

    	

    

of, or a specified increase in, economic value added targets
based on a cash flow return on investment formula; (xi) the attainment of certain target levels of, or a specified increase in,
free or operational cash flow; and (xii) the achievement of a certain level of, reduction of, or other specified objectives with
regard to limiting the level of increase in, all or a portion of the Company’s bank debt or other long-term or short-term
public or private debt or other similar financial obligations of the Company, which may be calculated net of such cash balances
and/or other offsets and adjustments as may be established by the Committee. For purposes of items (ii) and (iv) above, “extraordinary
items” shall mean all items of gain, loss or expense for the Plan Year determined to be extraordinary or unusual in nature
or infrequent in occurrence or related to a corporate transaction (including, without limitation, a disposition or acquisition)
or related to a change in accounting principle, all as determined in accordance with standards as defined by the Financial Accounting
Standards Board’s Accounting Standards Codification Topic 225-20.

 

In addition, such Performance Goals may be
based upon the attainment of specified levels of Company or any of its Affiliates (or a group, division, operational unit or administrative
department of the Company or any of its Affiliates) performance under one or more of the measures described above relative to the
performance of other corporations. To the extent permitted under Code Section 162(m), but only to the extent permitted under Code
Section 162(m) (including, without limitation, compliance with any requirements for stockholder approval), the Committee may: (i)
designate additional business criteria on which the Performance Goals may be based or (ii) adjust, modify or amend the aforementioned
business criteria.

 

6.3        COMMITTEE
CERTIFICATION. Performance Awards shall not be paid before the Committee certifies in writing that the Performance Goals specified
pursuant to subsection 6.2 have been satisfied. Notwithstanding the forgoing, the Committee may, in its sole and absolute discretion,
permit the payment of Performance Awards with respect to a Plan Year in the case of death or “disability” of the Participant
(within the meaning of Code Section 409A) or, to the extent provided in Section 7.3 of the Plan, Change in Control of the Company
during such Plan Year without regard to actual achievement of the Performance Goals and whether or not payment of such Awards would
be deductible; provided, however, that this provision shall be of no force or effect to the extent Awards made under the Plan would
fail to be qualified performance-based compensation under Code Section 162(m)(4)(C) and Treasury regulations issued thereunder
regardless of payment. The Committee may not use its discretion to increase a Performance Award that would otherwise be payable
upon attainment of the Performance Goals. The Committee shall use its best efforts to make a determination with regard to satisfaction
of the Performance Goals as soon as practicable after the end of each Plan Year.

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7.        Time
of Payment

 

7.1        GENERAL.
Except as otherwise provided in this Section 7, Awards shall be paid no later than two and one-half 21⁄2 months
following the Plan Year in which they are earned subject to the Participant’s continued active employment with the Company
or any of its Affiliates on the payment date.

 

7.2        DISABILITY
AND DEATH. The Committee, in its sole discretion, may waive the requirement of continued active employment on the payment date
in the event that during the Plan Year to which the Performance Award relates the Participant experiences a termination of employment
due to death or disability.

 

7.3        CHANGE
IN CONTROL. In the event of a Change in Control of the Company during the Plan Year to which an Award relates, the Committee may,
in its discretion, pay upon the consummation of such transaction a pro-rata portion (through the date of the Change in Control
of the Company) of the Performance Award for such Plan Year at 100% of the Individual Target Award. Any such immediate pro-rata
payment shall reduce any other Award made for such Plan Year under this Plan to the Participant by the amount of the pro-rata payment.

 

7.4        DEFERRAL
ELECTION. A Participant may elect to defer payment of an Award pursuant to a written agreement executed on or before the date that
is six months before the end of the Plan Year to which the Performance Award relates in accordance with any deferred compensation
program in effect applicable to such Participant and in compliance with the requirements of Code Section 409A. Any Performance
Award deferred by a Participant shall be subject to the provisions of the Company’s Management Stock Purchase Plan or any
successor plan. The Participant shall have no right to receive payment of any deferred Award prior to the attainment of the Performance
Goals for the Plan Year to which the Award relates and certification of such attainment by the Committee and until the Participant
has a right to receive such amount under the terms of the applicable deferred compensation program.

 

8.        Non-Assignability

 

No Award under this Plan nor any right or
benefit under this Plan shall be subject to anticipation, alienation, sale, assignment, pledge, encumbrance, garnishment, execution
or levy of any kind or charge, and any attempt to anticipate, alienate, sell, assign, pledge, encumber and, to the extent permitted
by applicable law, charge, garnish, execute upon or levy upon the same shall be void and shall not be recognized or given effect
by the Company.

    	6

    	

    

9.        No
Right to Employment

 

Nothing in the Plan or in any notice of award
pursuant to the Plan shall confer upon any person the right to continue in the employment of the Company or any of its Affiliates
or affect the right of the Company or any of its Affiliates to terminate the employment of any Participant.

 

10.       Amendment
or Termination

 

The Board (or a duly authorized committee
thereof) may, in its sole and absolute discretion, amend, suspend or terminate the Plan or adopt a new plan in place of this Plan
at any time; provided, that no such amendment shall, without the prior approval of the stockholders of the Company entitled to
vote thereon in accordance with the laws of the State of Delaware to the extent required under Code Section 162(m): (i) materially
alter the Performance Goals as set forth in subsection 6.2; (ii) change the class of eligible employees set forth in Section 4(a);
or (iii) implement any change to a provision of the Plan requiring stockholder approval in order for the Plan to continue to comply
with the requirements of Code Section 162(m). Furthermore, no amendment, suspension, or termination shall, without the consent
of the Participant, alter or impair a Participant’s right to receive payment of an Award for a Plan Year otherwise payable
hereunder.

 

11.       Severability

 

In the event that any one or more of the
provisions contained in the Plan shall, for any reason, be held to be invalid, illegal or unenforceable, in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision of the Plan and the Plan shall be construed as if such invalid,
illegal or unenforceable provisions had never been contained therein.

 

12.       Withholding

 

The Company shall have the right to make
such provisions as it deems necessary or appropriate to satisfy any obligations it may have to withhold federal, state, or local
income or other taxes incurred by reason of payments pursuant to the Plan.

 

13.       Sections
162(m) and 409A

 

It is intended that the Plan be administered
in compliance with Code Section 162(m) so that the Awards paid under the Plan to Participants who are or may become subject to
Code Section 162(m) will be treated as qualified performance-based compensation under Code Section 162(m)(4)(C). If any provision
of the Plan does not comply with the

    	7

    	

    

requirements of Code Section 162(m), then the Committee may
construe or amend such provision to the extent necessary to conform to such requirements.

 

It is intended that the Awards granted under
the Plan shall be exempt from, or in compliance with, Code Section 409A. In the event any of the Awards issued under the Plan are
subject to Code Section 409A, it is intended that no payment or entitlement pursuant to this Plan will give rise to any adverse
tax consequences to a Participant under Code Section 409A. The Plan shall be interpreted to that end and, consistent with that
objective and notwithstanding any provision herein to the contrary, the Company may unilaterally take any action it deems necessary
or desirable to amend any provision herein to avoid the application of or excise tax under Code Section 409A provided that such
action is consistent with the requirements of Code Section 162(m). Neither the Company nor its Affiliates, nor their current employees,
officers, directors, representatives or agents shall have any liability to any current or former Participant with respect to any
accelerated taxation, additional taxes, penalties or interest for which any current or former Participant may become liable in
the event that any amounts payable under the Plan are determined to violate Section 409A.

 

14.       Governing
Law

 

This Plan and any amendments thereto shall
be construed, administered, and governed in all respects in accordance with the laws of the State of Delaware (regardless of the
law that might otherwise govern under applicable principles of conflict of laws).

    	8

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