EXECUTIVE EMPLOYMENT AGREEMENT
This EXECUTIVE EMPLOYMENT AGREEMENT (the “Agreement”) is made as of July 1, 2014
by and between Citizens Financial Group, Inc. (the “Company”) and Stephen Gannon
(“Executive”) (certain capitalized terms used herein being defined in Section
17).
WHEREAS the Company desires to employ Executive and to enter into this Agreement
embodying the terms of such employment; and
WHEREAS Executive desires to accept such employment and enter into this
Agreement;
NOW, THEREFORE, in consideration of the promises and mutual covenants herein and
for other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties agree as follows:
Section 1. Employment At-Will.
(a)Executive’s employment with the Company shall be strictly "at-will" and not
for any fixed term. Executive understands and acknowledges that no statement,
whether written or verbal, by the Company or any of its officers, employees or
representatives may in any way modify, alter, or change the strictly "at-will"
nature of his employment relationship with the Company. Both Executive and the
Company retain the right to terminate employment at any time, for any reason or
no reason. Executive understands and agrees that, as an at-will employee, the
Company may terminate his employment without advance notice. Executive may
terminate his employment for any reason (a “Resignation”) effective ninety (90)
days following his delivery of written Notice of Termination to the Board (the
“Notice Period”).
(b)Upon receipt of a Resignation from Executive, the Company may, in its sole
discretion, waive the Notice period, in which case Executive will be permitted
to terminate immediately. Under such circumstances the Company will not be
obliged to pay in lieu of notice. Alternatively, the Company may direct
Executive not to report to work unless otherwise requested by the Company (the
“Garden Leave”). During any period of Garden Leave, as within any Notice Period:
(i)Executive will remain an employee of the Company and will continue to be paid
his then Base Salary and continue to be eligible for Employee Benefits excluding
any Discretionary Deferred Award and/or other incentive compensation;
(ii)Executive will be expected to continue to undertake such duties and
responsibilities as are assigned to Executive by the Company's Board or Chief
Executive Officer, including duties to assist the Company with his transition
from the Company and maintaining the Company’s business, business relationships,
and goodwill. Notwithstanding the foregoing, the Company reserves the right to
suspend any or all of Executive’s duties and powers and to relocate his office
to his personal residence for all or part of his Garden Leave;
(iii)Executive will remain bound by all fiduciary duties and obligations owed to
the Company and required to comply with all Company policies and practices and
the provisions of this Agreement.
(iv)Executive may not, without the prior written consent of the Company or
except in the discharge of duties and responsibilities in accordance with clause
(ii) above, contact or attempt to contact any client, customer, agent,
professional adviser, employee, supplier or broker of the Company or of any
subsidiary or Affiliate of the Company;
Section 2. Position.
(a)Position. During Executive’s employment, he shall serve as General Counsel
for Citizens Financial Group or in such other capacity of like status as the
Company requires. In this position, Executive shall report directly to Bruce Van
Saun Chairman and CEO of Citizens Financial Group or to such other person as the
Company or the Board may specify from time to time. Notwithstanding anything
else contained within this Agreement, the Company shall be entitled from time to
time to appoint one or more persons to act jointly with Executive, in its sole
discretion. Additionally, Executive's role has been identified as a Material
Risk Taker (“MRT”) under the European Banking Authority ("EBA") rules and,
therefore, will be subject to the EBA rules so long as they shall apply.
(b)Best Efforts. During Executive’s employment, Executive shall: (i) devote his
full professional time, attention, skill and energy to the performance of his
duties for the Company and its affiliates, including The Royal Bank of Scotland,

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plc located in North America and The Royal Bank of Scotland Group Plc
(collectively the “Group”); (ii) use his best efforts to dutifully, faithfully
and efficiently perform his duties hereunder, comply with the Group’s policies,
procedures, bylaws, rules, code of conduct and practices, as the same may be
amended from time to time, and obey all reasonable and lawful directions given
by or under the authority of the Board; (iii) refrain from engaging in any other
business, profession or occupation for compensation or otherwise which would
conflict, directly or indirectly, with the rendition of services to the Company,
without the prior written consent of the Board; except that Executive may engage
in charitable and community activities and manage his personal investments
provided that such activities do not materially interfere with the performance
of his duties hereunder or conflict with the conditions of his employment; and
(iv) refrain from engaging in any conduct prejudicial to the interests and
reputation of the Group but instead endeavor to promote and extend the business
of the Group and protect and further its interests and reputation.
(c)Directorships. Executive may be required, in the sole discretion of the
Company, to perform services for any Group Company and may be required to
undertake the role and duties of an officer or non-executive director of other
companies in the Group. No additional remuneration will be paid in respect of
these appointments.
(d)Location. During the period of Executive’s employment, Executive shall be
based in Boston, Massachusetts but may be relocated within a fifty (50) mile
radius of the same location at the Company’s sole discretion. Additionally,
Executive may be required to travel elsewhere in the world in the performance of
his duties.
Section 3. Compensation.
(a)Base Salary. The Company shall pay Executive a base salary (the “Base
Salary”) at the initial annual rate of $600,000.00 in substantially equal
installments as it is earned not less frequently than monthly in accordance with
the Company’s usual payroll practices. Executive shall be entitled to such
increases in Executive’s Base Salary as may be determined from time to time in
the sole discretion of the Remuneration Committee.
(b)Role Based Allowance. As your role has been identified as a MRT role under
the EBA rules, you will also receive a Role Based Allowance of $550,000 (the
“Allowance”), less any applicable tax and other statutory deductions. For 2014,
the Allowance will be prorated based on your start date and paid in equal
instalments in accordance with the Company’s regular payroll cycle. Thereafter,
any Allowance amount above $500,000 payable in a single calendar year will be
paid as follows: a) the first $500,000 payable in equal instalments in
accordance with the Company’s regular payroll cycle and b) the remainder payable
in four equal quarterly instalments of CFG stock. You will not be eligible for
the Allowance if your employment terminates before the Allowance payment date
for that period. The use of Allowances will be reviewed annually and may be
changed or removed at the sole discretion of the Company, or as required by
regulation. In the event the Allowance is removed, an appropriate adjustment to
Executive’s variable compensation shall be made to increase the discretionary
variable incentive award opportunity from $1,100,000.00 referenced in Section
3(c) below to a discretionary variable incentive award opportunity of
$1,650,000.00.
(c)Variable Incentive Compensation. Executive will be eligible to take part in
the discretionary incentive award program for the business unit (the
“Discretionary Award Program”). The Discretionary Award Program rewards
performance during the financial year from January 1 to December 31, and is
based on achievement against a mix of targets, which may include personal, team,
business, Company targets and external economic considerations. The Company may
in its absolute discretion provide Executive an award of such amount, at such
intervals and subject to such conditions as the Company may in its sole
discretion determine appropriate from time to time. Any such award may be paid
in cash, shares or any other form, may be deferred in full or in part as
provided in accordance with the Company’s compensation plans as that plan may be
in effect and amended from time to time (the “Deferral Plan”), and may be
forfeited or reduced in such circumstances and on such terms as the Company,
acting in good faith and in its sole discretion, determines appropriate. The
exercise of discretion in one financial year shall not bind the Company or act
as a precedent for its exercise of discretion in any other financial year. If,
on or before the date when an award might otherwise have been payable,
Executive’s employment has terminated or either party has given notice under
this Agreement to terminate Executive’s employment, Executive will not be
entitled to receive any such award (whether in cash, shares or any other form).
The Company reserves the right to change the rules of any award schemes, or to
cancel such schemes, at any time without prior notice. In the event of any
conflict, the rules of any relevant award scheme and the Deferral Plan (both as
they may be amended from time to time) shall take precedence over the terms of
this Agreement. Currently the discretionary variable incentive award opportunity
for Executive’s position is $1,100,000.00.
(d)Conditional Bonus. Subject to the below, for the performance year 2014 only,
you will receive as part of your Variable Incentive Compensation a conditional
performance bonus of $450,000.00, less any applicable tax and other statutory
deductions (the “Conditional Bonus”), subject to you receiving a performance
rating of 3 based on achieving

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the Objectives outlined below. In the event that you fail to achieve these
Objectives, the Conditional Bonus will be reviewed for appropriate payout, if
any.
•
Review changes or developments in law, regulation or market practice to consider
their impact on products, processes, transactions and our customers

•
Lead the legal work to contribute to a successful IPO of Citizens Financial
Group and separation from RBS by actively participating in IPO related Core
Working Group meetings, representing the Company in meetings with RBS,
investment bankers and underwriters, and providing input into IPO related
documentation and agreements

•
Lead the legal function and provide advice and counsel to proactively manage and
mitigate legal risk

•
Manage legal spend within appropriate budget to achieve best value for the bank

•
Complete an assessment of the organizational structure and staff by December 31,
2014

•
Provide legal advice and support efforts to remediate regulatory issues by
actively participating in the Company's Executive Risk Forum and Regulatory
Executive Steering Committee meetings

•
Take personal responsibility for adherence to policies and procedures designed
to meet the spirit and letter of our regulatory obligations, for ensuring fair
outcomes to our customers and supporting prompt identification, reporting and
remediation of issues

The Company reserves the right to change (amend or replace) these Objectives at
any time with prior consultation with you. In the event of any change,
the objectives subsequently notified to you (the "New Objectives") will take
precedence over these Objectives. All other terms and conditions, as set out in
this letter, will remain unaffected unless advised to the contrary.

The Conditional Bonus will be paid in the form of a Deferred Award made under
the RBS Deferral Plan applicable from time to time, or such other plan that may
be in operation at that time (the “Deferral Plan”). The RBS Group reserves the
right to change the rules of the Deferral Plan, or to cancel or replace it, at
any time (including, for the avoidance of doubt, during any financial year) in
its sole and absolute discretion and, for the avoidance of any doubt, such
change may have a retrospective effect.

You will not be eligible to be paid the Conditional Bonus if your employment
terminates or either party has given notice to terminate your employment on or
before the Award Date of the relevant Deferred Award unless such termination
falls within one of the following exceptional circumstances:

•
ill-health, injury or disability, as established to the satisfaction of the RBS
Group;

•
death;

•
retirement with the approval of the RBS Group;

•
your employing company ceasing to be a member of the RBS Group, except via
divestiture through Initial Public Offering ("IPO");

•
the business in which you work being transferred to a person or entity which is
not a member of the RBS Group;

•
redundancy with the approval of the RBS Group.

If the termination of your employment does fall within one of the above
circumstances, you will remain eligible to receive the Conditional Bonus in the
form of a Deferred Award.

For your information, the Deferral Plan contains certain provisions in respect
of when a Deferred Award, or a proportion of it, may be forfeited as a result of
termination of employment. In particular, if before the date on which the
Deferred Award or a part of it becomes payable or vests, your employment has
terminated or the Company has given notice to terminate your employment for
Cause (as defined in the Deferral Plan rules), or you have resigned in
circumstances which would entitle the Company to summarily terminate your
employment, you will not be entitled to receive your Deferred Award or any
remaining part of it. If your employment has terminated (or either party has
given notice to terminate your employment) for other reasons, in most cases,
your Deferred Award will continue to become payable and vest (subject always to
the below), unless you have engaged in Competitive or Detrimental Activity, in
accordance with the rules of the Deferral Plan (as amended or replaced from time
to time).

The rules of the Deferral Plan also contain provisions under which unvested
elements of Deferred Awards can be delayed, reduced or forfeited and these will
apply to any Deferred Award made to you. In the event of any conflict, the rules
of the Deferral Plan shall take precedence over the terms of this letter whether
implemented before or after your employment commences.

(e) Executive Long-Term Incentive Plans. Executive shall, at the absolute
discretion of the Remuneration Committee, be eligible to participate to the same
extent as other similarly-situated Company executives in Long-Term Incentive
Plan

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as that plan may be in effect from time to time, subject to the rules of that
plan as they may be amended from time to time in the Company’s sole discretion.
For performance year 2014 only as part of your Variable Incentive Compensation
you will eligible for a long-term incentive award of at least $650,000.00.

Section 4. Stock Buyout In Cash
To recognize that you will forfeit value in your previous employer's stock
schemes as a result of joining the Company, you will receive a Cash Buyout
payment using the RBS Group method of valuation.

Payment will be subject to you providing proof (in a form acceptable to the
Company) of such entitlements and that they will be forfeited as a result of you
leaving your current employer.

Please ensure you provide the following documents within 30 days of the
commencement of your employment with the Company:

•
proof (in a form acceptable to the Company) of award of such entitlements, for
example original award statements; and

•
confirmation from your current employer (in a form acceptable to the Company)
that the awards have been forfeited together with details of the awards that
have been forfeited as a result of you leaving your current employer.

The Cash Buyout, with a value estimated at $1,732,000.00 will be paid in cash
(less any applicable tax and other statutory deductions). The amount will be
valued using the RBS Group method of valuation for the 5-days prior to your
Start Date.

The Award will be made no later than December 31, 2014 following commencement of
your employment and receipt of all required documentation. Following receipt, a
letter will be sent to you confirming the final valuation.

Repayment of Cash Buyout Payment

If within 12 months of your start date with the Company either your employment
terminates or notice to terminate your employment is given by either party, you
will be responsible for repaying to the Company, within 14 calendar days of the
date of termination of your employment, the net amount (following any applicable
tax and other statutory deductions) of any installments of the Cash Buyout
payment that you have received unless such termination falls within one of the
following exceptional circumstances:

•
ill-health, injury or disability, as established to the satisfaction of the RBS
Group;

•
death;

•
retirement with the approval of the RBS Group;

•
your employing company ceasing to be a member of the RBS Group, except via
divestiture through IPO;

•
the business in which you work being transferred to a person or entity which is
not a member of the RBS Group; or

•
redundancy/without cause termination with the approval of the RBS Group.

Forfeiture of Unpaid Cash Buyout Installments

If before the final installment is paid your employment terminates or either
party has given notice to terminate your employment, you will not be entitled to
receive any of the outstanding installments.

Clawback of Unpaid Cash Buyout Installments

The RBS Group Remuneration Committee (“the Committee”) may review unpaid
installments of the Cash Buyout in the light of the performance of the Company,
any member of the Company’s group and any business area or team, and your
conduct, capability or performance. The review may take place at any time
determined by the Committee.
Without prejudice to the generality of the foregoing, in carrying out a review,
the Committee will consider in respect of the financial year in relation to
which the Cash Buyout was made:

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•
whether the results announced for that financial year have subsequently appeared
materially inaccurate or misleading;

•
whether a business unit or profit centre in which you worked has subsequently
made a loss out of business written in that year or from circumstances that
could reasonably have been risk-managed in that year; and/or

•
any other matter which appears relevant, and

•
Your conduct, capability or performance, and the performance of any team,
business area or profit centre, if the Committee deems that the circumstances
warrant a review.

Following a review under the paragraphs above, the Committee may, in its sole
discretion, make any determination in respect of any installment that has not
been paid, including for example to:
•
reduce the value of an installment; or

•
determine that an installment of a Cash Buyout will not be paid.

Disciplinary Investigations

The RBS Group also reserves the right to withhold payment of the Cash Buyout
payment pending the outcome of any disciplinary procedures relating to any
matter or matters which the RBS Group could treat as grounds for termination of
employment, or any other internal or external investigation (which for the
avoidance of doubt may extend beyond the date your employment terminates). If
you are subsequently dismissed (or given notice of dismissal) or if you
subsequently resign (or give notice of resignation) for any reason other than
one of the exceptional circumstances set out above, you will not be entitled to
receive any of the outstanding installments (including, for the avoidance of
doubt, the installment that has been withheld pending the outcome of the
disciplinary procedure or investigation) and may have to repay the full amount
of any payment(s) already received by you as set out in the preceding
paragraphs.

Where applicable, all amounts of compensation paid to you will be paid subject
to applicable tax and other required withholdings.

Section 5. Relocation
The Company will reimburse Executive for reasonable relocation expenses
associated with Executive’s move from Richmond, VA to Boston, MA, in accordance
with the terms of the relocation package that has been forwarded separately. All
relocation expenses must be appropriately documented. Any relocation
reimbursements will be treated as income to Executive, and are subject to
appropriate tax gross-ups. As a condition of this offer, Executive is also
required to execute the Relocation Repayment Agreement. Executive will be bound
by all terms of the relocation policy including repayment obligations.

Section 6. Other Employee Benefits, Vacation and Perquisites.
(a)Employee Benefits. Executive may participate in and receive benefits under
any and all executive welfare and health benefit plans (including but not
limited to group healthcare (medical, vision and dental), life insurance, and
short-term and long-term disability plans) and other executive benefit plans
(including but not limited to qualified pension plans, retirement, savings and
401(k) if any, that are offered to other similarly-situated executives of the
Company based in the United States, to the extent he is eligible thereunder and
in accordance with all other terms and conditions of such plans, policies,
programs and practices (collectively, the “Employee Benefits”). Generally,
Employee Benefits shall start on the first date of the month following 30 days
of the Executive’s commencement of performance, unless otherwise provided in
accordance with the terms of the applicable plan document, program, policy or
practice. Copies of all pertinent plan, program or policy documents will be
provided to Executive on request, to the extent the same are within the
Company’s control. The Company will not have any liability to pay any benefit to
Executive under any insurance plan or program unless it receives payment of the
benefit from the insurer. All benefits and the plans, programs, policies, or
practices relating to them may be changed at any time by the Company within its
sole discretion.
(b)Paid Time Off. Executive shall be entitled to accrue 27 days of paid time off
(“PTO”) annually, which may be scheduled as time off away from work in
accordance with the Company’s current PTO policy as applicable in the United
States. For 2014, Executive’s PTO will be pro-rated based on the 1st of the
month following his date of hire, provided that his date of hire occurs on or
before September 30th; if his date of hire is subsequent to September 30th,
Executive will not be eligible to earn PTO until the beginning of the next
calendar year.

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(c)Perquisites. Executive shall be provided such additional perquisites and
fringe benefits as are generally made available to other similarly-situated
executives of the Company who are based in the United States.
(d)Reimbursement of Business Expenses. Reasonable, customary and necessary
travel, entertainment and other business expenses incurred by Executive in the
performance of his duties hereunder shall be reimbursed by the Company in
accordance with the Company’s policies, subject to such reasonable
substantiation and documentation as may be required by the Company from time to
time.
(e)Sickness. Executive will be eligible for all payments in respect of short and
long-term disability generally made available from time to time to other
similarly-situated executives in the United States. Unless required under
applicable federal or state law, Executive does not have any contractual or
other right to payment in respect of any period of absence due to sickness or
incapacity and any such payments will be made at the Company’s sole discretion.
Executive shall at any time (including during any period of incapacity) at the
request and expense of the Company submit to medical examinations by a medical
practitioner nominated by the Company, to the extent permitted by applicable
federal and state law. Executive agrees, and hereby authorizes, that the results
of any such medical examination be disclosed to the Company, subject to the
provisions of the United States Health Insurance Portability and Accountability
Act of 1996.
(f)Severance. In the event Executive is made redundant or otherwise has his
employment terminated without cause and for reasons unrelated to poor
performance, unless such circumstances relate to a Change in Control as
described in Section 7 below, Executive shall be entitled to receive a minimum
severance payment amounting to 26 weeks of Executive's base salary at the time
of Executive's exit contingent upon Executive executing, and not revoking, the
Company's standard release agreement then in use.
Section 7. Change in Control.
In the event that Executive is made redundant solely as a result of the sale of
the Company, via means other than an IPO, prior to such time as RBS's ownership
interest in the Company drops below 50%, Executive shall receive a payment
equivalent to 150% of Executives fixed pay. For the purposes of this Section 7,
"fixed pay" shall mean the sum total of the amounts described in Sections 3(a)
and 3(b) above. Such payment is contingent upon Executive executing, and not
revoking, the Company's standard release agreement then in use. Any payment
pursuant to this Section 7 shall be in lieu of, not in addition to, any
separation payment Executive may otherwise have been eligible for pursuant to
Section 6(f) above or any Company policy or practice with respect to separation
from employment which may be in effect from time to time. At such time as RBS's
ownership interest in the Company drops below 50%, this Section 7 becomes null
and void by its own terms with immediate effect.
Section 8. Staff Dealing.
Executive is subject to the Company’s Staff Dealing Rules (and divisional rules
where applicable) which may require prior permission be obtained before he is
permitted to deal in most types of securities transactions. Requests must be
submitted in writing on the appropriate Company form. The Company also operates
a closed period during which Executive will not be permitted to deal in Company
or RBS Group shares. Failure to abide by these rules will constitute serious
misconduct and may lead to criminal proceedings and/or the immediate termination
of Executive’s employment.
Section 9. Non-Solicitation.
(a)Non-Solicitation of Employees. Executive agrees that, at any time during his
employment and the Restricted Period, Executive shall not, directly or
indirectly, whether for his own account or for any other person or entity hire,
employ, solicit for employment or hire, or attempt to solicit for employment or
hire, any person who was employed by the Company or any of its parents,
subsidiaries or affiliates, including any member of the RBS Group at any time
within one year prior to the time of the act of solicitation (and who, in the
case of the Restricted Period following the Executive’s termination of
employment, was also employed by the Company or any of its subsidiaries or
Affiliates on the date the Restricted Period begins) (“Covered Employee”).
Executive further agrees not to otherwise interfere with the relationship
between any Covered Employee and the Company. Anything to the contrary
notwithstanding, the Company agrees that Executive shall not be deemed in
violation of this subsection 9(a) if an entity with which Executive is
associated hires or engages any employee of the Company or any of its
subsidiaries, if Executive was not, directly or indirectly, involved in hiring
or identifying such person as a potential recruit or assisting in the
recruitment of such employee.
(b)Non-Solicitation of Customers and Prospective Clients. Executive agrees that
during his employment and the Restricted Period, Executive shall not, directly
or indirectly, whether for his own account or for any other person or entity,
through any corporation, partnership or other business entity of any kind,
solicit, assist in soliciting for business or entice

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away or in any manner attempt to persuade any client or customer or prospective
client or customer to discontinue or diminish his, her or its relationship or
prospective relationship with the Company, or otherwise provide business to any
person, corporation, partnership or other business entity of any kind other than
the Company; provided, however, that general solicitation through advertisement
shall not constitute solicitation for purposes of this provision.
(c)Representations. Executive agrees that all of the foregoing restrictions are
reasonable and necessary to protect the Company’s business and its Confidential
Information and that his employment by the Company, along with the benefits and
attributes of that employment, is good and valuable consideration to compensate
him or her for agreeing to all restrictions contained in this Agreement.
Executive also acknowledges, represents and warrants that his knowledge, skills
and abilities are sufficient to permit Executive to earn a satisfactory
livelihood without violating these provisions. Further, Executive agrees that he
shall not, following the termination of his employment with the Company,
represent or hold himself out as being in any way connected with the business of
the Company.
(d)Blue Pencil. It is expressly understood and agreed that although Executive
and the Company consider the restrictions contained in this Section 9 to be
reasonable, if a final judicial determination is made by an arbitrator or a
court of competent jurisdiction that the time or territory or any other
restriction contained in this Agreement is an unenforceable restriction against
Executive, the provisions of this Agreement shall not be rendered void but shall
be deemed amended to apply as to such maximum time and territory and to such
maximum extent as such court may judicially determine or indicate to be
enforceable. Alternatively, if an arbitrator or a court of competent
jurisdiction finds that any restriction contained in this Agreement is
unenforceable, and such restriction cannot be amended so as to make it
enforceable, such finding shall not affect the enforceability of any of the
other restrictions contained herein.
Section 10. Confidentiality; Ownership of Materials; Duty to Return Company
Property.
(a)Confidential Information. Executive may not at any time (whether during his
employment or after its termination) disclose to any unauthorized person, firm
or corporation or use or attempt to use for his own advantage or to the
advantage of any other person, firm or corporation, any confidential information
relating to the business affairs or trade secrets of the Company or any member
of the RBS Group, or any confidential information about (howsoever obtained) or
provided by any third party received during the course of or as a result of his
employment (the “Confidential Information”). Confidential Information includes,
but is not limited to, information relating to employees, customers and
suppliers (former, actual and potential), Company contracts, pricing structures,
financial and marketing details, business plans, any technical data, designs,
formulae, product lines, intellectual property, research activities and any
Company and/or RBS Group information which may be deemed to be commercially or
price sensitive in nature, whether printed, typed, handwritten, videotaped,
transmitted or transcribed on data files or on any other type of media, whether
or not labeled as “confidential”. It also includes, without limitation, any
information contained in documents marked “confidential” or documents of a
higher security classification and other information which, because of its
nature or the circumstances in which Executive receives it, Executive should
reasonably consider to be confidential. The Company reserves the right to modify
the categories of Confidential Information from time to time.
(b)No Copies. Executive is not permitted to make any copy, abstract, summary or
précis of the whole or any part of any document belonging to a member of the
Group unless he has been authorized to do so by the Company, and shall not at
any time use or permit to be used any such items otherwise than for the benefit
of the Company in the performance of his services hereunder.
(c)Exclusions. The provisions of this Section 10 shall not apply to:
(i)information or knowledge which subsequently comes into the public domain
other than by way of unauthorized use or disclosure by Executive;
(ii)the discharge by Executive of his duties hereunder or where his use or
disclosure of the information has otherwise been properly authorized by the
Company;
(iii)any information which Executive discloses in accordance with applicable
public interest disclosure legislation;
(iv)any disclosure required by law or by any court, arbitrator, mediator or
administrative or legislative body (including any committee thereof) with
jurisdiction to order Executive to disclose or make accessible any information;
or

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(d)Due Care. Executive shall exercise all due care and diligence and shall take
all reasonable steps to prevent the publication or disclosure by Executive of
any Confidential Information relating, in particular, but not limited to, actual
or proposed transactions, of any employee, customer, client or supplier (whether
former, actual or potential) of the Company or any member of the RBS Group
including partnerships, companies, bodies, and corporations having accounts with
or in any way connected to or in discussion with any member of the Company or
RBS Group and all other matters relating to such customers, clients or suppliers
and connections.
(e)Duty to Return Confidential Information and Other Company Property.
(i)All reports, files, notes, memoranda, e-mails, accounts, documents or other
material (including all notes and memoranda of any Confidential Information and
any copies made or received by Executive in the course of his employment
(whether during or after) are and shall remain the sole property of the Company
or the appropriate member of the RBS Group and, following his termination of
employment or at any other time upon the Company’s request, to the extent within
his possession or control, shall be surrendered by Executive to the duly
authorized representative of the Company.
(ii)Executive agrees that upon termination of his employment with the Company
for any reason, or at any other time upon the Company’s request, he will return
to the Company immediately all memoranda, books, papers, plans, information,
letters and other data, all copies thereof or therefrom, in any way relating to
the business of the Company or RBS Group, all other property of the Company
(including, but not limited to, company car, credit cards, equipment,
correspondence, data, disks, tapes, records, specifications, software, models,
notes, reports and other documents together with any extracts or summaries,
removable drives or other computer equipment, keys and security passes) or of
any member of the RBS Group in his possession or under his control and Executive
further agrees that Executive will not retain or use for his own account at any
time any trade names, trademark or other proprietary business designation used
or owned in connection with the business of the Company or its affiliates.
(f)Reasonableness. Executive agrees that the undertakings set forth in this
Section 10 and in Section 9 are reasonable and necessary to protect the
legitimate business interests of the Company and RBS Group both during, and
after the termination of, his employment, and that the benefits Executive
receives under this Agreement are sufficient compensation for these
restrictions.
Section 11. Intellectual Property and Developments.
(a)Executive agrees that all Developments are the sole and exclusive property of
the Company and hereby assigns all rights to such Developments to the Company in
all countries. Executive agrees, at the Company’s expense at any time during his
employment or thereafter, to sign all appropriate documents and carry out all
such reasonable acts as will be necessary to identify and preserve the legal
protection of all Developments; however, the Company will have no obligation to
compensate Executive for his time spent in connection with any assistance
provided unless otherwise required by law. Notwithstanding the foregoing,
Executive understands that no provision in this Agreement is intended to require
assignment of any of his rights in an invention for which Executive can prove no
equipment, supplies, facilities or Confidential Information or trade secret
information of the Company was used, which invention was developed entirely on
his own time, and which invention Executive can prove: (a) does not relate to
the business of the Company or the actual or demonstrably anticipated research
or development of the Company; or (b) does not result from any work performed by
Executive for the Company. To the extent compatible with applicable state law,
these provisions do not apply to any invention which is required to be assigned
by the Company to the United States Government. Executive waives all moral
rights in all Intellectual Property which is owned by the Company, or will be
owned by the Company, pursuant to this Section 11.
(b)Executive agrees to promptly submit to the Company written disclosures of all
inventions, whether or not patentable, which are made, conceived or authored by
Executive, alone or jointly with others, while Executive is employed by the
Company.
Section 12. Certain Agreements.
(a)Data Protection. Executive shall familiarize himself with and abide by the
Company’s Data Protection policy, procedures and accountabilities. Executive
acknowledges that any breach of these procedures may result in the immediate
termination of his employment.

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(b)Personal Information. Executive acknowledges and agrees that the Company is
permitted to hold personal information about him as part of its personnel and
other business records and, in accordance with applicable law, may use such
information in the course of the Company’s business.
(c)Credit Data. The Company reserves the right, upon five (5) days prior written
notice, to, and Executive agrees that the Company may, in accordance with
applicable law, carry out searches about Executive through credit reference
agencies or through the Company’s customer records at any time during his
employment for purposes of identifying any serious debt or other significant
financial difficulties of Executive for the purposes of detecting, eliminating
or mitigating any particular risk of employee fraud or theft. The Company will
only retain the information about Executive which the Company obtains from these
searches in accordance with applicable law and for so long as is needed for the
purposes set out above (subject to any legal (including any regulatory)
obligation which requires the Company to retain that information for a longer
period). The credit reference agency will record details of the search but these
will not be available for use by lenders to assess the ability of Executive to
obtain credit. Executive has the right of access to his personal records held by
credit reference agencies. The Company will supply the names and addresses of
such agencies upon request, to help Executive to exercise his right of access to
such records.
(d)Indebtedness. For the reasons referred to above, the Company expects
Executive to manage his personal finances responsibly. The Company requires that
Executive draw to the attention of his manager any serious debt or significant
financial difficulties that he may have, including those which result in court
action being taken against Executive.
Section 13. Remedies.
The Company and Executive agree that it is impossible to measure solely in money
the damages which will accrue to the Company by reason of his failure to observe
any of his obligations of Sections 9, 10 or 11 of this Agreement. Therefore, if
the Company shall institute any action or proceeding to enforce such provisions,
Executive hereby waives the claim or defense that there is an adequate remedy at
law and agrees in any such action or proceeding not to interpose the claim or
defense that such remedy exists at law. Without limiting any other remedies that
may be available to the Company, Executive hereby specifically affirms the
appropriateness of injunctive or other equitable relief in any such action and
acknowledges that nothing contained within this Agreement shall preclude the
Company from seeking or receiving any other relief, including without
limitation, any form of injunctive or equitable relief. Executive also agrees
that, should he violate the provisions of Section 9 and its subsections such
that the Company shall be forced to undertake any efforts to defend, confirm or
declare the validity of the covenants contained within Section 9 of this
Agreement, the time restrictions set forth therein shall be extended for a
period of time equal to the pendency of any court proceedings, including
appeals. Further, Executive agrees that, should the Company undertake any
efforts to defend, confirm or declare the validity of any of the covenants
contained in Sections 9, 10 or 11 of this Agreement, the Company shall be
entitled to recover from Executive all of its reasonable attorneys’ fees and
costs incurred in prosecuting or defending any such action or engaging in any
such efforts.
Section 14. No Conflicts.
(a)Executive represents and warrants to the Company that on the Commencement
Date, to the best of Executive’s knowledge, Executive’s acceptance of employment
with, and performance of Executive’s duties for, the Company will not conflict
with or result in a violation or breach of, or constitute a default under, any
contract, agreement or understanding to which Executive is, or was, a party or
of which Executive is aware and that there are no restrictions, covenants,
agreements or limitations on Executive’s right or ability to enter into and
perform the terms of this Agreement.
Section 15. Dispute Resolution; Mediation and Arbitration.
Except as provided in the last sentence of this Section 15 to the fullest extent
permitted by law, the Company and Executive agree to waive their rights to seek
remedies in court, including but not limited to rights to a trial by jury. The
Company and Executive agree that any dispute between or among them or their
Subsidiaries, Affiliates or related entities arising out of, relating to or in
connection with this Agreement or his employment with the Company, including but
not limited to claims for discrimination or other alleged violations of any
federal, state or local employment and labor law statutes, ordinances or
regulations, will be resolved in accordance with a confidential two-step dispute
resolution procedure involving: (1) Step One: non-binding mediation, and (2)
Step Two: binding arbitration under the Federal Arbitration Act, 9 U.S.C. § 1,
et. seq., or state law, whichever is applicable. Any such mediation or
arbitration hereunder shall be under the auspices of the American Arbitration
Association (“AAA”) pursuant to its then current Commercial Arbitration Rules
and Mediation Procedures (the “AAA Commercial Rules”). Disputes encompassed by
this Section include claims for discrimination arising under local, state or
federal statutes or ordinances and claims arising under any state’s labor laws.
Notwithstanding anything to the contrary in the AAA Commercial Rules, the
mediation process (Step One) may be ended by either party to the dispute upon
notice to the other party that it desires to terminate the mediation and proceed

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to the Step Two arbitration; provided, however, that neither party may so
terminate the mediation process prior to the occurrence of at least one (1)
mediation session with the mediator. No arbitration shall be initiated or take
place with respect to a given dispute if the parties have successfully achieved
a mutually agreed to resolution of the dispute as a result of the Step One
mediation. The mediation session(s) and, if necessary, the arbitration hearing
shall be held in the city nearest to Executive's office location during the
course of Executive's employment with the Company or an alternative location
mutually agreeable to Executive and the Company. The arbitration (if the dispute
is not resolved by mediation) will be conducted by a single AAA arbitrator,
mutually selected by the parties, as provided for by the AAA Commercial Rules.
The Company will be responsible for the AAA charges, including the costs of the
mediator and arbitrator. The Company and Executive agree that the arbitrator
shall apply the substantive law of the State of New York to all state law claims
and federal law to any federal law claims, that discovery shall be conducted in
accordance with the AAA Commercial Rules or as otherwise permitted by law as
determined by the arbitrator. In accordance with the AAA Commercial Rules (a
copy of which is available through AAA’s website, www.adr.org), the arbitrator’s
award shall consist of a written statement as to the disposition of each claim
and the relief, if any, awarded on each claim. The Company and Executive
understand that the right to appeal or to seek modification of any ruling or
award by the arbitrator is limited under state and federal law. Any award
rendered by the arbitrator will be final and binding, and judgment may be
entered on it in any court of competent jurisdiction. Nothing contained herein
shall restrict either party from seeking temporary injunctive relief in a court
of law to the extent set forth in Section 13 hereof.
In the unlikely event the AAA refuses to accept jurisdiction over a dispute,
Executive and the Company agree to submit to Judicial-Arbitration-Mediation
Services (“JAMS”) mediation and arbitration applying the JAMS equivalent of the
AAA Commercial Rules. If AAA and JAMS refuse to accept jurisdiction, the parties
may litigate in a court of competent jurisdiction.
Section 16. Miscellaneous.
(a)Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without regard for the
conflict of laws provisions thereof.
(b)Entire Agreement and Amendments; Survivorship; Strict Construction.
(i)This Agreement contains the entire understanding and agreement of the parties
with respect to the subject matter hereof. There are no restrictions,
agreements, promises, warranties, covenants or undertakings between the parties
with respect to the subject matter herein other than those expressly set forth
herein. This Agreement may not be altered, modified, or amended except by
written instrument signed by the parties hereto, which attaches a copy of this
Agreement.
(ii)The respective rights and obligations of the parties hereunder shall survive
any termination of this Agreement to the extent necessary to the intended
preservation of such rights and obligations.
(c)No Waiver. The failure of a party to insist upon strict adherence to any term
of this Agreement on any occasion shall not be considered a waiver of such
party’s rights or deprive such party of the right thereafter to insist upon
strict adherence to that term or any other term of this Agreement.
(d)Severability. In the event that any one or more of the provisions of this
Agreement shall be or become invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions of this
Agreement shall not be affected thereby.
(e)Assignment. This Agreement shall not be assignable by Executive. This
Agreement shall be freely assignable by the Company without restriction.
(f)Successors; Binding Agreement. This Agreement shall inure to the benefit of
and be binding upon personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees, legatees and
permitted assigns.
(g)Notice. For the purpose of this Agreement, notices and all other
communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when delivered or three (3) business days after
mailing registered mail, return receipt requested, postage prepaid or by
recognized courier, addressed to the respective addresses set forth on the
execution page of this Agreement, provided that all notices to the Company shall
be directed to the attention of the Board with a copy to the Secretary of the
Company, and with a copy to the Secretary of the Royal Bank of Scotland Group
plc, 36 St Andrew Square, Edinburgh, EH2 2YB or to such other address as either
party may have furnished to the other in writing in accordance herewith, except
that notice of change of address shall be effective only upon receipt.

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(h)Withholding Taxes; Deductions. The Company may withhold from any amounts
payable under this Agreement such federal, state and local taxes as may be
required to be withheld pursuant to any applicable law or regulation. Executive
agrees that the Company may, at any time during, or in any event upon
termination of his employment, deduct from his remuneration, any monies due by
his to the Company for any overpayment made and/or outstanding loans, advances,
relocation expenses and/or salary paid in respect of excess Vacation that was
taken but not earned, unless otherwise prohibited by law.
(i)Counterparts; Effectiveness. This Agreement may be signed in counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument. This Agreement shall become
effective when each party hereto shall have received a counterpart hereof signed
by the other party hereto, including by fax or electronic pdf.
Section 17. Defined Terms.
“Affiliate” has the meaning accorded such term under Rule 12b-2 under the
Securities Exchange Act of 1934, as in effect on the Commencement Date;
“Agreement” has the meaning set forth in the Recitals;
“Board" means the board of directors of the Company from time to time, or any
duly authorized committee of the board of directors of the Company from time to
time;
“Base Salary” has the meaning set forth in Section 3;
“Commencement Date” has the meaning set forth in Section 1;
“Group” means the Company, and each of the Company’s Parent's Subsidiaries or
Affiliates;
“Confidential Information” has the meaning set forth in Section 10;
“Covered Employee” has the meaning set forth in Section 9;
“Deferral Plan” means The Royal Bank of Scotland Group plc Deferral Plan or any
successor plans or other operative plan applicable to the Company from time to
time;
“Developments” means all inventions, whether or not patentable, Confidential
Information, computer programs, copyright works, mask works, trademarks and
other intellectual property made, conceived or authored by Executive, alone or
jointly with others, while employed by the Company, whether or not during normal
business hours or on the Company’s premises, that are within the existing or
contemplated scope of the Company’s business at the time such Developments are
made, conceived, or authored or which result from or are suggested by any work
Executive or others may do for or on behalf of the Company;
“Employee Benefits” has the meaning set forth in Section 6;
“Person” means any individual, corporation, partnership, trust or any other
entity or organization;
“RBSG” or "RBS Group" means the Royal Bank of Scotland Group Plc;
“Remuneration Committee" means the remuneration committee of the Board or any
committee empowered by the Board in substitution for the Remuneration Committee;
“Restricted Period” means the twelve (12) month period following the date that
Executive ceases employment with the Company; and
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the day and year first above written.

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Executive
/s/ Stephen Gannon
Stephen Gannon

 
By:
/s/ Bruce Van Saun
 
Bruce Van Saun
 
 
Chairman and CEO
Citizens Financial Group
 
 
 
 
 

 

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