Lumen Technologies updates executive severance plan and CEO agreement

Lumen Technologies, Inc. (NASDAQ:LUMN) announced changes to its executive severance arrangements on Thursday, according to a statement based on a recent SEC filing.

The company amended its previous executive severance plan to remove Chief Executive Officer Kate Johnson and other named executive officers as participants. The prior plan was renamed the Lumen Severance Plan. With the consent of each affected officer, Lumen also terminated individual change of control agreements previously in place. Participation agreements were then executed with the officers under a newly adopted Lumen Executive Severance Plan.The restructuring comes as Lumen faces significant headwinds. The telecommunications company, with a market capitalization of $4.6 billion, has seen its stock plunge 41% year-to-date and currently trades at $4.57, down nearly 50% over the past six months. According to InvestingPro analysis, the stock appears overvalued at current levels. The company carries $13.5 billion in total debt while revenue declined 7.74% over the last twelve months, and InvestingPro Tips indicate analysts do not anticipate profitability this year. For investors seeking deeper insights, InvestingPro offers comprehensive Pro Research Reports on Lumen and over 1,400 other US equities, transforming complex data into actionable intelligence.

According to the filing, the new plan maintains substantially the same severance and change in control benefits as before. Under the revised terms, if a participating officer’s employment is terminated without cause or if the officer resigns for good reason outside of a change in control period, the officer will receive cash severance equal to 52 weeks of base salary, any earned but unpaid annual bonus for the prior year, a prorated annual target bonus for the year of termination, a 12-month COBRA premium subsidy, and outplacement assistance.

If termination or resignation occurs within three months before or up to 24 months after a change in control, the officer is entitled to a cash payment equal to two times the sum of base salary and the average annual bonus from the previous three years, a prorated annual bonus for the year of termination, any unpaid annual bonus for the prior year, a 24-month COBRA premium subsidy, and outplacement assistance.

All benefits are contingent upon the officer executing a separation and release agreement and complying with relevant covenants. Payments may be reduced if subject to excise tax, with no gross-up provided.

Additionally, Lumen entered into an amended and restated change of control and severance agreement with CEO Kate Johnson. Under this agreement, if Johnson’s employment ends without cause or she resigns for good reason outside of a change in control period, she will receive 104 weeks of base salary plus her target annual bonus. If such events occur within 24 months of a change in control, she will receive 2.5 times her base salary and target annual bonus, a prorated annual bonus, any unpaid bonus for the prior year, two years of continued insurance benefits, and one year of outplacement assistance.

The agreement also updates the definition of “good reason” and removes Johnson’s non-competition covenant to comply with upcoming Washington state law.

This information is based on a press release statement and the company’s SEC filing.

In other recent news, Lumen Technologies reported its financial results for the second quarter of 2026, surpassing analysts’ expectations in both earnings and revenue. The company recorded an adjusted loss of $0.07 per share, which was better than the predicted loss of $0.13 per share. Lumen’s revenue increased to $2.8 billion, exceeding the forecast of $2.74 billion. This performance was attributed to growth in strategic services and a shift away from legacy products. The company’s results reflect positive developments for investors, highlighting a trend toward improved revenue mix. While analysts had anticipated a more significant loss, Lumen’s results suggest effective management of its financial strategies. These recent developments may influence future analyst assessments and investor confidence.