Document:

Exhibit

Exhibit 10.2 

[DATE PROVIDED TO EXECUTIVE]

TERMINATION PAY AGREEMENT

This Termination Pay Agreement (the “Agreement”), dated as of [DATE], is between J.C. Penney Corporation, Inc. (“Corporation”) and [EXECUTIVE NAME], its [EXECUTIVE TITLE] (the “Executive”).

WHEREAS, in order to achieve its long-term objectives, the Corporation recognizes that it is essential to attract and retain superior executives;

WHEREAS, in order to induce the Executive to serve in the Executive’s position with the Corporation, the Corporation desires to provide the Executive with the right to receive certain benefits in the event the Executive experiences an Involuntary Separation from Service other than for Cause, as defined in this Agreement, on the terms and subject to the conditions hereinafter set forth; 

WHEREAS, in return for receiving the benefits provided for in this Agreement in connection with the Executive’s Involuntary Separation from Service other than for Cause, the Executive agrees to be bound by certain restrictive covenants, as described in Section 3, in connection with the Executive’s Voluntary Separation from Service or Involuntary Separation from Service other than for Cause; and

WHEREAS, all capitalized terms used in this Agreement shall have the meaning ascribed to them in Section 2 of this Agreement unless the context clearly provides otherwise.

NOW, THEREFORE, in consideration of the promises and of the mutual covenants herein contained, it is agreed as follows: 

		
	1.
	Termination Payments and Benefits.

		
	1.1
	Death or Permanent Disability.  In the event of a Separation from Service due to death, or in the event of a Separation from Service within 30 days following a determination of Permanent Disability (as defined in Section 2 of this Agreement) of the Executive, then as soon as practicable or within the period required by law, but in no event later than 30 days after Separation from Service, the Corporation shall pay:

(a) the Compensation Payments; and 
          (b)  the Prorated Bonus.      
The payment of any death benefits or disability benefits under any employee benefit or compensation plan that is maintained by the Corporation for the Executive’s benefit shall be governed by the terms of such plan in effect at the time of death or permanent disability.
		
	1.2
	Involuntary Separation from Service for Cause.  In the event of the Involuntary Separation from Service (as defined in Section 2 of this Agreement) of the Executive for Cause (as defined in Section 2 of this Agreement), the Corporation shall pay the Compensation Payments to the Executive as soon as practicable or within the period required by law, and the Executive shall be entitled to no other compensation, except as otherwise due to the Executive under applicable law, or an applicable plan or program for which he or she remains eligible as of the date of the Involuntary Separation from Service.  The Executive shall not be entitled to the payment 

of any bonuses for any portion of the fiscal year in which such Separation from Service occurs.  If the Executive has accrued a bonus for all, or a portion of, the fiscal year preceding the date of such Separation from Service that is readily ascertainable, but not yet paid, the Executive shall be entitled to such payment in the same form and manner as otherwise set forth in the Management Incentive Compensation Program or other applicable plan or program for which he or she remains eligible as of the date of the Involuntary Separation from Service. 

		
	1.3
	Voluntary Separation from Service by the Executive. In the event of a Voluntary Separation from Service by the Executive (i) the Corporation shall pay the Executive any accrued and unpaid Base Salary as soon as practicable or within the period required by law, and (ii) the Executive agrees to be bound by the terms of the Covenants and Representations contained in Section 3 of this Agreement.  The Executive shall be entitled to no other compensation, except as otherwise due to the Executive under applicable law or applicable plan or program for which he or she remains eligible as of the date of the Voluntary Separation from Service.  The Executive shall not be entitled to the payment of any bonuses, including any amounts payable under the Management Incentive Compensation Program for any portion of the fiscal year in which such Separation from Service occurs, except as may otherwise be expressly provided under the Management Incentive Compensation Program.  If the Executive has accrued a bonus for all, or a portion of, the fiscal year preceding the date of such Separation from Service that is readily ascertainable, but not yet paid, the Executive shall be entitled to such payment in the same form and manner as otherwise set forth in the Management Incentive Compensation Program or other applicable plan or program for which he or she remains eligible as of the date of the Voluntary Separation from Service. 

		
	1.4
	Involuntary Separation from Service without Cause.

		
	(a)
	Form and Amount.  In the event of the Executive’s Involuntary Separation from Service without Cause, the Corporation shall pay the Compensation Payments to the Executive as soon as practicable, but in any event within any period required by law.  In addition, conditioned upon receipt of the Executive’s written release of claims in such form as may be required by the Corporation and the expiration of any applicable period during which the Executive can rescind or revoke such release, the Corporation shall pay the Executive: 

		
	(i)
	severance pay in equal installments, no less frequently than monthly, during the 12-month period following the Executive’s Involuntary Separation from Service without Cause equal to the Executive’s monthly Base Salary; 

		
	(ii)
	the Executive’s target annual incentive (at $1.00 per unit) under the Corporation’s Management Incentive Compensation Program for the fiscal year in which the Executive experiences an Involuntary Separation from Service other than for Cause converted to a monthly amount by dividing that target annual incentive amount by 12, in equal installments, no less frequently than monthly, during the applicable Severance Period. 

		
	(iii)
	subsidized COBRA payments, if the Executive is eligible for continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) under the group health plan coverage options (medical, dental, vision, etc.) under the J. C. Penney Corporation, Inc. Health and Welfare Benefit Plan (“Health and Welfare Plan”) and the Executive elects COBRA continuation coverage under the group health plan  coverage options under the Health and Welfare Plan.  The amount of such subsidy shall be equal to the Corporation’s portion of the premium cost of the Executive’s group health plan coverage elections under the Health and Welfare Plan that the Corporation paid while the Executive was an active associate. 

		
	(iv)
	a lump sum equal to (a) Special Bonus Hours to the extent provided under Section 1.4(c) of this Agreement, if applicable, and (b) $15,000 to pay for outplacement services and financial counseling services; and 

		
	(v)
	a lump sum equal to the Severance Bonus. If the Executive has accrued a bonus for all, or a portion of, the fiscal year preceding the date of such Separation from Service that is readily ascertainable, but not yet paid, the Executive shall be entitled to such payment in the same form and manner as otherwise set forth in the Management Incentive Compensation Program or other applicable plan or program for which he or she remains eligible as of the date of the Involuntary Separation from Service. 

Notwithstanding the foregoing, such lump sum amounts under this Section 1.4(a) shall be paid to the Executive within 14 days of the Executive’s Involuntary Separation from Service other than for Cause, but in no event later than two and one-half months after the end of the Executive’s tax year in which the Involuntary Separation from Service occurs. If the applicable revocation or rescission period described in this Section 1.4(a) with respect to any waiver or release of claims begins in one taxable year and ends in a second taxable year, any payments and other rights described in this Section 1.4(a) shall not commence until the second taxable year.  In addition to the payments provided for herein, following an Involuntary Separation from Service other than for Cause, the Corporation shall also provide to the Executive Accelerated Vesting as provided in Section 1.4(d) of this Agreement.

		
	(b)
	Health and Dental Insurance Continuation.  Following an Involuntary Separation from Service other than for Cause, the Executive will, as provided in Section 1.4(a)(iii) of this Agreement, be eligible to receive COBRA continuation coverage under the group health plan options, as applicable, at active associate rates if (i) the Executive is enrolled in a full-time group health plan option, as applicable, under the Health and Welfare Plan on the effective date of the Executive’s Involuntary Separation from Service other than for Cause and the Corporation currently is paying a portion of the Executive’s premium for the group health plan coverage on the Executive’s behalf, and (ii) the Executive timely elects COBRA continuation coverage under the Health and Welfare Plan.  If the Executive satisfies these prerequisites, the Corporation will allow the Executive to participate in COBRA continuation coverage under the Health and Welfare Plan at active associate rates until the earlier of (i) the end of the month that coincides with or next follows the term of the Severance Period; and (ii) the end of the month prior to the month the Executive fails to timely make any required premium payment under the Health and Welfare Plan in connection with receiving COBRA continuation coverage under the Health and Welfare Plan or otherwise loses eligibility for COBRA continuation coverage. Any subsidized COBRA continuation coverage provided under this Section 1.4(b) run concurrently with the Executive’s maximum statutory continuation period under COBRA.

		
	(c)
	Special Bonus Hours.  Following an Involuntary Separation from Service, the Corporation shall pay the Executive a lump sum payment for Special Bonus Hours, if the Executive is a participant in the Corporation’s PTO Policy.  Such payment shall be determined in accordance with the provisions of the PTO Policy applicable to an involuntary termination resulting from a reduction in force.

		
	(d)
	Accelerated Vesting.  On Executive's Involuntary Separation from Service other than for Cause, Executive shall:

		
	(i)
	with respect to any equity award that constitutes an Inducement Award, immediately vest in such Inducement Award as provided in the applicable award notice or agreement evidencing the award.

		
	(ii)
	with respect to any award of stock options, stock appreciation rights, or time-based restricted stock or restricted units, immediately vest in a prorated number of the stock options, stock appreciation rights, and/or time-based restricted stock or restricted stock units based on the Executive's length of employment during the vesting period provided in the applicable award notice or agreement.

		
	(iii)
	with respect to any award of performance-based restricted stock or restricted stock unit awards, vest in a prorated number of such performance-based restricted stock or restricted stock units based on (X) Executive's length of employment during the performance period, and (Y) the attainment of the performance goal as of the end of the performance period, all as provided under the terms of the respective award notice or agreement. 

		
	(iv)
	with respect to any award of performance cash, vest in a prorated amount of such performance cash based on (X) Executive’s length of employment during the performance period, and (Y) the attainment of the performance goal as of the end of the performance period, all as provided under the terms of the respective award notice or agreement. 

		
	1.5
	Section 409A.  To the extent applicable, it is intended that portions of this Agreement either comply with or be exempt from the provisions of Section 409A of the Code.  Any provision of this Agreement that would cause this Agreement to fail to comply with or be exempt from Code section 409A shall have no force and effect until such provision is either amended to comply with or be exempt from section 409A of the Code (which amendment may be retroactive to the extent permitted by section 409A of the Code and the Executive hereby agrees not to withhold consent unreasonably to any amendment requested by the Corporation for the purpose of either complying with or being exempt from section 409A of the Code). 

 
		
	1.6 
	Enforcement and Forfeiture.  Notwithstanding the foregoing provisions of this Section 1, in addition to any remedies to which the Corporation is entitled, any right of the Executive to receive termination payments and benefits under Section 1 shall be forfeited to the extent of any amounts payable or benefits to be provided after a breach of any covenant set forth in Section 3.  On the Corporation’s becoming aware that the Executive has breached, or potentially has breached, any covenant set forth in Section 3 of this Agreement, the Corporation shall suspend all future installment payments under Section 1.4(a) of this Agreement and may seek full recoupment of all amounts previously paid to the Executive under Section 1.4(a) this Agreement and reasonable attorneys’ fees and legal expenses incurred in obtaining such recoupment. The forfeiture or recoupment of any equity awards that are subject to covenants like those contained in Section 3 of this Agreement shall be governed by the terms of the applicable equity award agreement containing such covenants.

		
	1.7  
	Non-Eligibility For Management Incentive Compensation Program benefits and Other Company Separation Pay Benefits.  The benefits provided for herein are intended to be in lieu of, and not in addition to, benefits under the Management Incentive Compensation Program the Executive could earn with respect to any incentive compensation or bonus program in place for the fiscal year in which the Executive’s Involuntary Separation from Service other than for Cause occurs or any other separation pay benefits to which the Executive might be entitled, including those under the Corporation’s Separation Pay Plan, or any successor plan or program offered by the Corporation, which the Executive hereby waives.  If the Executive receives benefits under the Corporation’s CIC Plan, in the event of Employment Termination (as defined in the CIC Plan), the covenants set forth in Section 3 hereof shall automatically terminate and, if the Executive shall receive all benefits to which the Executive is entitled under the CIC Plan, the Executive waives all benefits hereunder.

		
	1.8 
	Corporation’s Right of Offset.  If the Executive is at any time indebted to the Corporation, or otherwise obligated to pay money to the Corporation for any reason, to the extent exempt from or otherwise permitted by  section 409A of the Code and the Treasury regulations thereunder, including Treasury Regulation section 1.409A-3(j)(4)(xiii) or any successor thereto, the Corporation, at its election and following written notice, may offset amounts otherwise payable to the Executive under this Agreement, including, but without limitation, Base Salary and incentive compensation payments, against any such indebtedness or amounts due from the Executive to the Corporation, to the extent permitted by law.

		
	1.9 
	Mitigation.  In the event of the Involuntary Separation from Service of the Executive, the Executive shall not be required to mitigate damages by seeking other employment or otherwise as a condition to receiving termination payments or benefits under this Agreement.  No amounts earned by the Executive after the Executive’s Involuntary Separation from Service, whether from self-employment, as a common law employee, or otherwise, shall reduce the amount of any payment or benefit under any provision of this Agreement.  

		
	1.10 
	Resignations.  Except to the extent requested by the Corporation, upon  termination of the Executive’s service with the Corporation for any reason, the Executive shall immediately resign all positions and directorships with the Corporation and each of its subsidiaries and affiliates.

		
	2.
	Certain Definitions. 

As used in this Agreement, the following terms shall have the following meanings:
		
	2.1 
	“Agreement” shall mean this Termination Pay Agreement.

		
	2.2
	“Base Salary” shall mean the Executive’s annual base salary as in effect at the effective date of termination of the Executive’s termination of employment with the Corporation.

		
	2.3 
	“Cause” shall mean (a) Executive’s failure to substantially perform such duties with the Corporation or any subsidiary or affiliate as determined by the Board or the Corporation; (b) Executive’s willful failure or refusal to perform specific directives of the Board, or the Corporation, or any subsidiary or affiliate, which directives are consistent with the scope and nature of Executive’s duties and responsibilities; (c) Executive’s conviction of a felony; or (d) a breach of Executive's fiduciary duty to the Corporation or any subsidiary or affiliate or any act or omission of Executive that (A) constitutes a violation of the Corporation’s Statement of Business Ethics, (B) results in the assessment of a criminal penalty against the Corporation, (C) is otherwise in violation of any federal, state, local or foreign law or regulation (other than traffic violations and other similar misdemeanors), (D) adversely affects or could reasonably be expected to adversely affect the business reputation of the Corporation, or (E) otherwise constitutes willful misconduct, gross negligence, or any act of dishonesty or disloyalty. “Cause” also includes any of the above grounds for dismissal regardless of whether the Corporation learns of it before or after terminating Executive’s employment. 

		
	2.4
	“CIC Plan” shall mean the Corporation’s Change in Control Plan, to which Executive is a participant at the time of termination of employment. 

		
	2.5
	“Code” shall mean the Internal Revenue Code of 1986, as amended, including proposed, temporary or final regulations or any other guidance issued by the Secretary of the Treasury or the Internal Revenue Service with respect thereto.

		
	2.6
	“Compensation Payments” shall mean:

 
		
	(a)
	any accrued and unpaid Base Salary (as defined in Section 2 of this Agreement; and

 
		
	(b) 
	any vacation to which the Executive was entitled as of the effective date of termination of Executive’s employment with the Corporation under the terms of the applicable MTO Policy or PTO Policy to which Executive is a participant at the time of termination of employment.

		
	2.7
	“Competing Business” shall have the meaning ascribed thereto in Section 3.4.

		
	2.8
	“Corporation” shall mean J.C. Penney Corporation, Inc., a Delaware corporation, including its subsidiaries and affiliates, and any successor thereof.

		
	2.9
	“Executive” shall mean the individual Executive named herein. 

		
	2.10
	“Inducement Award” shall mean an equity award granted to Executive in consideration of Executive’s (i) employment with the Corporation, and (ii) forfeiture of equity awards granted by a former employer.

		
	2.11
	“Involuntary Separation from Service” shall mean the Executive’s Separation from Service due to the independent exercise of the unilateral authority of the Corporation to terminate the Executive's services, other than due to the Executive’s implicit or explicit request, where the Executive was willing and able to continue performing services, within the meaning of section 409A of the Code and Treasury Regulation section 1.409A-1(n)(1) or any successor thereto.

		
	2.12
	“Management Incentive Compensation Program” shall mean the Amended and Restated J. C. Penney Corporation, Inc. Management Incentive Compensation Program approved by shareholders of J. C. Penney Corporation, Inc. on May 19, 2017, as such may be amended from time to time, or any successor plan or program that replaces the Management Incentive Compensation Program. 

		
	2.13
	“MTO Policy” shall mean the Corporation’s My Time Off Policy, to which the Executive is a participant at the time of termination of employment. 

		
	2.14
	“Permanent Disability” means the Executive is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, within the meaning of section 409A of the Code and Treasury Regulation section 1.409A-3(i)(4)(i)(A) or any successor thereto. A determination of Permanent Disability, for purposes of payment under this Agreement, will be made by the Corporation’s disability insurance plan administrator or insurer.

		
	2.15 
	“Proprietary Information” shall have the meaning ascribed thereto in Section 3.

		
	2.16
	“Prorated Bonus” shall mean the target annual incentive (at $1.00 per unit) under the Corporations Management Incentive Compensation Program for the fiscal year in which the date of death or the determination of Permanent Disability occurs, prorated for the actual period of service for that fiscal year.

		
	2.17
	“PTO Policy”    shall mean the Corporation’s Paid Time Off Policy, to which the Executive is a participant at the time of termination of employment. 

		
	2.18
	“Separation from Service” within the meaning of section 409A of the Code and Treasury Regulation section 1.409A-1(h) or any successor thereto, shall mean the date an Executive retires, dies or otherwise has a termination of employment with the Corporation. In accordance with Treasury Regulation  section 1.409A-1(h) or any successor thereto, if an Executive is on a period of leave that exceeds six months and the Executive does not retain a right to reemployment under an applicable statute or by contract, the employment relationship is deemed to terminate on the first date immediately following such six-month period, and also, an Executive is presumed to have separated from service where the level of bona fide services performed (whether as an employee or an independent contractor) decreases to a level equal to 20 percent or less of the average level of services performed (whether as an employee or an independent contractor) by the Executive during the immediately preceding 36-month period (or the full period of service to the Corporation if the employee has been providing services for less than the 36-month period).

		
	2.19
	“Separation Pay Plan” means the J. C. Penney Corporation, Inc. Separation Pay Plan as such plan may be amended from time to time, including any successor plan or program that replaces the Separation Pay Plan.

		
	2.20
	“Severance Bonus” shall mean the actual incentive compensation payable to the Executive under the terms of the Management Incentive Compensation Program for the fiscal year in which the Executive experiences an Involuntary Separation from Service other than for Cause, prorated for the Executive’s actual period of service for the fiscal year, less any amounts previously paid to the Executive under the incentive compensation program for that fiscal year.  If the incentive compensation formula under the Management Incentive Compensation Program for the fiscal year in which the Executive’s Involuntary Separation from Service other than for Cause occurs includes an individual performance component/goal, for purposes of calculating the actual incentive compensation payable to the Executive for that fiscal year the portion of the incentive compensation attributable to the achievement of the individual performance component/goal will be determined at target for that fiscal year. 

		
	2.21
	“Voluntary Separation from Service” shall mean a Separation from Service other than as a result of the Executive’s death or an Involuntary Separation from Service. 

		
	3.
	Covenants and Representations of the Executive.  The Executive hereby acknowledges that the Executive’s duties to the Corporation require access to and creation of the Corporation’s confidential or proprietary information and trade secrets (collectively, the “Proprietary Information”).  The Proprietary Information has been and will continue to be developed by the Corporation and its subsidiaries and affiliates at substantial cost and constitutes valuable and unique property of the 

Corporation.  The Executive further acknowledges that due to the nature of the Executive’s position, the Executive will have access to Proprietary Information affecting plans and operations in every location in which the Corporation (and its subsidiaries and affiliates) does business or plans to do business throughout the world, and the Executive’s decisions and recommendations on behalf of the Corporation may affect its operations throughout the world.  Accordingly, the Executive acknowledges that the foregoing makes it reasonably necessary for the protection of the Corporation’s business interests that the Executive agree to the following covenants in connection with the Executive’s Involuntary Separation from Service other than for Cause and receipt of benefits under this Agreement or the Executive’s Voluntary Separation from Service:

		
	3.1
	Confidentiality.  The Executive hereby covenants and agrees that the Executive shall not, without the prior written consent of the Corporation, during the Executive’s employment with the Corporation or at any time thereafter disclose to any person not employed by the Corporation, or use in connection with engaging in competition with the Corporation, any Proprietary Information of the Corporation.

		
	(a)
	It is expressly understood and agreed that the Corporation’s Proprietary Information is all nonpublic information relating to the Corporation’s business, including but not limited to information, plans and strategies regarding suppliers, pricing, marketing, customers, hiring and terminations, employee performance and evaluations, internal reviews and investigations, short term and long range plans, acquisitions and divestitures, advertising, information systems, sales objectives and performance, as well as any other nonpublic information, the nondisclosure of which may provide a competitive or economic advantage to the Corporation. Proprietary Information shall not be deemed to have become public for purposes of this Agreement where it has been disclosed or made public by or through anyone acting in violation of a contractual, ethical, or legal responsibility to maintain its confidentiality.

		
	(b)
	In the event the Executive receives a subpoena, court order or other summons that may require the Executive to disclose Proprietary Information, on pain of civil or criminal penalty, the Executive will promptly give notice to the Corporation of the subpoena or summons and provide the Corporation an opportunity to appear at the Corporation’s expense and challenge the disclosure of its Proprietary Information, and the Executive shall provide reasonable cooperation to the Corporation for purposes of affording the Corporation the opportunity to prevent the disclosure of the Corporation’s Proprietary Information.

		
	(c)
	Nothing in this Agreement shall restrict Executive from, directly or indirectly, initiating communications with or responding to any inquiry from, or providing testimony before, the Securities and Exchange Commission (“SEC”), Financial Industries Regulatory Authority (“FINRA”), or any other self-regulatory organization or state or federal regulatory authority.

		
	3.2
	Nonsolicitation of Employees.  The Executive hereby covenants and agrees that during the Executive’s employment with the Corporation and, in the event the Executive has a Voluntary Separation from Service or will receive or has received the severance benefits provided for in Section 1.4, for a period of 12 calendar months following such Separation from Service, the Executive shall not, without the prior written consent of the Corporation, on the Executive’s own behalf or on the behalf of any person, firm or company, directly or indirectly, attempt to 

influence, persuade or induce, or assist any other person in so persuading or inducing, any of the employees of the Corporation (or any of its subsidiaries or affiliates) to give up his or her employment with the Corporation (or any of its subsidiaries or affiliates), and the Executive shall not directly or indirectly solicit or hire employees of the Corporation (or any of its subsidiaries or affiliates) for employment with any other employer, without regard to whether that employer is a Competing Business, as defined in section 3.4(b), below.

		
	3.3
	Noninterference with Business Relations. The Executive hereby covenants and agrees that during the Executive’s employment with the Corporation and, in the event the Executive has a Voluntary Separation from Service or will receive or has received the severance benefits provided for in Section 1.4, for a period of 12 calendar months following such Separation from Service, the Executive shall not, without the prior written consent of the Corporation, on the Executive’s own behalf or on the behalf of any person, firm or company, directly or indirectly, attempt to influence, persuade or induce, or assist any other person in so persuading or inducing, any person, firm or company to cease doing business with, reduce its business with, or decline to commence a business relationship with, the Corporation (or any of its subsidiaries or affiliates).

		
	3.4
	Noncompetition.  

		
	(a)
	The Executive covenants that during the Executive’s employment with the Corporation and, in the event the Executive has a Voluntary Separation from Service or will receive or has received the severance benefits provided for in Section 1.4, for a period of 12 calendar months following such Separation from Service, the Executive will not, except as otherwise provided for in this Section 3.4, undertake any work for a Competing Business, as defined in Section 3.4(b).

		
	(b)
	As used in this Agreement, the term “Competing Business” shall specifically include, but not be limited to: 

		
	(i)
	Amazon.com, Inc., Burlington Stores, Inc., Kohl’s Corporation, Lowe’s Companies, Inc., Macy’s, Inc., Target Corporation, The TJX Companies, Inc., Ross Stores, Inc., Walmart Inc., and any of their respective subsidiaries or affiliates, or 

		
	(ii)
	any business (A) that, at any time during the Severance Period,  competes directly with the Corporation through sales of merchandise or services in the United States or another country or commonwealth in which the Corporation, including its divisions, affiliates and licensees, operates, and (B) where the Executive performs services, whether paid or unpaid, in any capacity, including as an officer, director, owner, consultant, employee, agent, or representative, where such services involve the performance of (x) substantially similar duties or oversight responsibilities as those performed by the Executive at any time during the 12-month period preceding the Executive’s termination from the Corporation for any reason, or (y) greater duties or responsibilities that include such substantially similar duties or oversight responsibilities as those referred to in (x); or 

		
	(iii)
	any business that provides buying office or sourcing services to any business of the types referred to in this Section 3.4(b). 

		
	(c)
	For purposes of this section, the restrictions on working for a Competing Business shall include working at any location within the United States or Puerto Rico.  Executive acknowledges that the Corporation is a national retailer with operations throughout the United States and Puerto Rico and that the duties and responsibilities that the Executive performs, or will perform, for the Corporation directly impact the Corporation’s ability to compete with a Competing Business in a nationwide marketplace.  Executive further acknowledges that Executive has, or will have, access to sensitive and confidential information of the Corporation that relates to the Corporation’s ability to compete in a nationwide marketplace.

		
	3.5 
	Non-Disparagement.  The Executive covenants that the Executive will not make any statement or representation, oral or written, that could adversely affect the reputation, image, goodwill or commercial interests of the Corporation.  This provision will be construed as broadly as state or federal law permits, but no more broadly than permitted by state or federal law.  This provision is not intended to and does not prohibit the Executive from participating in a governmental investigation concerning the Corporation, or providing truthful testimony in any lawsuit, arbitration, mediation, negotiation or other matter. 

		
	3.6
	Injunctive Relief.  If the Executive shall breach any of the covenants contained in this Section 3, the Corporation shall have no further obligation to make any payment to the Executive pursuant to this Agreement and may recover from the Executive all such damages as it may be entitled to at law or in equity.  In addition, the Executive acknowledges that any such breach is likely to result in immediate and irreparable harm to the Corporation for which money damages are likely to be inadequate.  Accordingly, the Executive consents to injunctive and other appropriate equitable relief without the necessity of bond in excess of $500.00 upon the institution of proceedings therefor by the Corporation in order to protect the Corporation’s rights hereunder.

		
	4.
	Employment-at-Will.  Notwithstanding any provision in this Agreement to the contrary, the Executive hereby acknowledges and agrees that the Executive’s employment with the Corporation is for an unspecified duration and constitutes “at-will” employment, and the Executive further acknowledges and agrees that this employment relationship may be terminated at any time, with or without Cause or for any or no Cause, at the option either of the Corporation or the Executive. 

		
	5.
	Miscellaneous Provisions.

		
	5.1
	Execution and Delivery of this Agreement.  You will have 90 days following the later of (i) your effective date of employment, or (ii) the date you receive a copy of this Agreement, either physically or electronically, to execute and return this Agreement evidencing your acceptance of its terms and your agreement to be bound by the restrictive covenants under Section 3 of this Agreement in connection with your Voluntary Separation from Service or your Involuntary Separation from Service other than for Cause in order to receive the benefits under this Agreement in connection with your Involuntary Separation from Service other than for Cause.  Failure to timely deliver an executed version of this Agreement within the timeframe provided in this Section 5.1 shall be evidence of your waiver of the benefits under this Agreement.

		
	5.2
	Dispute Resolution.  Any dispute between the parties under this Agreement shall be resolved (except as provided below) through informal binding mandatory arbitration by an arbitrator selected under the rules of the American Arbitration Association for arbitration of employment disputes (located in the city in which the Corporation’s principal executive offices are based) and the arbitration shall be conducted in that location under the rules of said Association.  Each party shall be entitled to present evidence and argument to the arbitrator.  The arbitrator shall have the right only to interpret and apply the provisions of this Agreement and may not change any of its provisions, except as expressly provided in Section 3.4 and only in the event the Corporation has not brought an action in a court of competent jurisdiction to enforce the covenants in Section 3. The arbitrator shall permit reasonable pre-hearing discovery of facts, to the extent necessary to establish a claim or a defense to a claim, subject to supervision by the arbitrator.  The determination of the arbitrator shall be conclusive and binding upon the parties and judgment upon the same may be entered in any court having jurisdiction thereof.  The arbitrator shall give written notice to the parties stating the arbitrator’s determination, and shall furnish to each party a signed copy of such determination.  The expenses of arbitration shall be borne equally by the Corporation and the Executive or as the arbitrator equitably determines consistent with the application of state or federal law; provided, however, that the Executive’s share of such expenses shall not exceed the maximum permitted by law.  To the extent applicable, in accordance with Code section 409A and Treasury Regulation section 1.409A-3(i)(1)(iv)(A) or any successor thereto, any payments or reimbursement of arbitration expenses which the Corporation is required to make under the foregoing provision shall meet the requirements below.  The Corporation shall reimburse the Executive for any such expenses, promptly upon delivery of reasonable documentation, provided, however, all invoices for reimbursement of expenses must be submitted to the Corporation and paid in a lump sum payment by the end of the calendar year following the calendar year in which the expense was incurred.  All expenses must be incurred within a 2-year period following the Separation from Service.  The amount of expenses paid or eligible for reimbursement in one year under this Section 5.1 shall not affect the expenses paid or eligible for reimbursement in any other taxable year.   The right to payment or reimbursement under this Section 5.1 shall not be subject to liquidation or exchange for another benefit.

Any arbitration or action pursuant to this Section 5.1 shall be governed by and construed in accordance with the substantive laws of the State of Texas and, where applicable, federal law, without giving effect to the principles of conflict of laws of such State.  The mandatory arbitration provisions of this Section 5.1 shall supersede in their entirety the J.C. Penney Alternative, a dispute resolution program generally applicable to 

employment terminations, any existing Binding Mandatory Arbitration Agreement between Executive and the Corporation, and the JCPenney Rules of Employment Arbitration in the limited context of claims regarding the enforcement of this Agreement.  Any other claims shall be resolved by the J.C. Penney Alternative, a dispute resolution program generally applicable to employment terminations, any existing Binding Mandatory Arbitration Agreement between Executive and the Corporation, and the JCPenney Rules of Employment Arbitration.  Executive explicitly waives, and may not litigate, any multi-party claims or claims available in multi-party litigation, such as class actions.
Notwithstanding the foregoing, the Corporation shall not be required to seek or participate in arbitration regarding any actual or threatened breach of the Executive’s covenants in Section 3, but may pursue its remedies, including temporary or permanent injunctive relief, for such breach in a court of competent jurisdiction in the city in which the Corporation’s principal executive offices are based, or in the sole discretion of the Corporation, in a court of competent jurisdiction where the Executive has committed or is threatening to commit a breach of the Executive’s covenants, and no arbitrator may make any ruling inconsistent with the findings or rulings of such court.
		
	5.3
	Binding on Successors; Assignment.  This Agreement shall be binding upon and inure to the benefit of the Executive, the Corporation and each of their respective successors, assigns, personal and legal representatives, executors, administrators, heirs, distributees, devisees, and legatees, as applicable; provided however, that neither this Agreement nor any rights or obligations hereunder shall be assignable or otherwise subject to hypothecation by the Executive (except by will or by operation of the laws of intestate succession) or by the Corporation except that the Corporation may assign this Agreement to any successor (whether by merger, purchase or otherwise) to all or substantially all of the stock, assets or businesses of the Corporation, if such successor expressly agrees to assume the obligations of the Corporation hereunder.

		
	5.4
	Governing Law.  This Agreement shall be governed, construed, interpreted, and enforced in accordance with the substantive law of the State of Texas and federal law, without regard to conflicts of law principles, except as expressly provided herein. In the event the Corporation exercises its discretion under Section 5.1 to bring an action to enforce the covenants contained in Section 3 in a court of competent jurisdiction where the Executive has breached or threatened to breach such covenants, and in no other event, the parties agree that the court may apply the law of the jurisdiction in which such action is pending in order to enforce the covenants to the fullest extent permissible.

		
	5.5
	Severability.  Any provision of this Agreement that is deemed invalid, illegal or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective, to the extent of such invalidity, illegality or unenforceability, without affecting in any way the remaining provisions hereof in such jurisdiction or rendering that or any other provisions of this Agreement invalid, illegal or unenforceable in any other jurisdiction.  If any covenant in Section 3 should be deemed invalid, illegal or unenforceable because its time, geographical area, or restricted activity, is considered excessive, such covenant shall be modified to the minimum extent necessary to render the modified covenant valid, legal and enforceable.

		
	5.6
	Notices.  For all purposes of this Agreement, all communications required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given when hand delivered or dispatched by electronic facsimile transmission (with receipt thereof confirmed), or five business days after having been mailed by United States registered or certified mail, return receipt requested, postage prepaid, or three business days after having been sent by a nationally recognized overnight courier service, addressed to the Corporation at its principal executive office, c/o the Corporation’s General Counsel, and to the Executive at the Executive’s principal residence, or to such other address as any party may have furnished to the other in writing and in accordance herewith, except that notices of change of address shall be effective only upon receipt.

		
	5.7
	Counterparts.  This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same Agreement.

		
	5.8
	Entire Agreement.  The terms of this Agreement are intended by the parties to be the final expression of their agreement with respect to the Executive’s employment by the Corporation and may not be contradicted by evidence of any prior or contemporaneous agreement.  The parties further intend that this Agreement shall constitute the complete and exclusive statement of its terms and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative, or other legal proceedings to vary the terms of this Agreement.  

		
	5.9
	Amendments; Waivers.  This Agreement may not be modified, amended, or terminated except by an instrument in writing, approved by the Corporation and signed by the Executive and the Corporation. Failure on the part of either party to complain of any action or omission, breach or default on the part of the other party, no matter how long the same may continue, shall never be deemed to be a waiver of any rights or remedies hereunder, at law or in equity.  The Executive or the Corporation may waive compliance by the other party with any provision of this Agreement that such other party was or is obligated to comply with or perform only through an executed writing; provided, however, that such waiver shall not operate as a waiver of, or estoppel with respect to, any other or subsequent failure.

		
	5.10
	No Inconsistent Actions.  The parties hereto shall not voluntarily undertake or fail to undertake any action or course of action that is inconsistent with the provisions or essential intent of this Agreement.  Furthermore, it is the intent of the parties hereto to act in a fair and reasonable manner with respect to the interpretation and application of the provisions of this Agreement.

		
	5.11
	Headings, Section References, and Recitations.  The headings used in this Agreement are intended for convenience or reference only and shall not in any manner amplify, limit, modify or otherwise be used in the construction or interpretation of any provision of this Agreement.  All section references are to sections of this Agreement, unless otherwise noted. The Recitations contained at the beginning of this Agreement are intended to be a part of this Agreement.

		
	5.12
	Beneficiaries.  The Executive shall be entitled to select (and change, to the extent permitted under any applicable law) a beneficiary or beneficiaries to receive any compensation or benefit payable hereunder following the Executive’s death, and may change such election, in either case by giving the Corporation written notice thereof in accordance with Section 5.5.  In the event of the Executive’s death or a judicial determination of the Executive’s incompetence, reference in this Agreement to the “Executive” shall be deemed, where appropriate, to be the Executive’s beneficiary, estate or other legal representative.

		
	5.13
	Withholding.  The Corporation shall be entitled to withhold from payment any amount of withholding required by law. 

		
	5.14
	Installments.  For purposes of applying section 409A of the Code to this Agreement, each separately identified amount the Executive is entitled to receive under this Agreement shall be treated as a separate payment. In addition, to the extent permitted under section 409A of the Code, the right to receive any installment payments under this Agreement shall be treated as a right to receive a series of separate payments and, accordingly, each installment payment shall at all times be considered a separate and distinct payment.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date and year first above written.
J. C. Penney Corporation, Inc.

By:     ___________________________________
Name:  [CORPORATE EXECUTIVE SIGNING]
Title:    [CORPORATE EXECUTIVE TITLE]

[EXECUTIVE NAME]

Name:     
Title:    [EXECUTIVE TITLE]EX-10.1

 Exhibit 10.1 

Execution Version 
 Funko, Inc.

 2802 Wetmore Avenue 
 Everett,
WA 98201 
 April 15, 2019 

Mr. Russell Nickel 
 c/o Funko, Inc. 

2802 Wetmore Avenue 
 Everett, WA 98201 

 

	 	Re:	 Transition and Release of Claims Agreement 

Dear Russell: 
 This letter agreement (this
“Letter Agreement”), entered into on the date first set forth above (the “Effective Date”), sets forth the understanding by and between you and Funko, Inc. (collectively with its direct and indirect subsidiaries,
and any successor(s) thereto, the “Company”), regarding the cessation of your employment with the Company and the transition of your role as Chief Financial Officer of the Company to your successor. 

1.    Separation Date and Transition Services. 

a. Your active employment with the Company will terminate on December 31, 2019 (or such earlier date upon which you resign your
employment or your employment is terminated by the Company for Cause) (the “Separation Date”) and, as of the Separation Date, you will cease to be an employee, officer and director of the Company and its direct and indirect
subsidiaries. Notwithstanding the foregoing, you hereby agree that you will hereby resign any offices or directorships you may hold at the Company and its subsidiaries prior to the Separation Date if and as requested by the Company. Until the
Separation Date, that certain Employment Agreement by and between the Company and you, dated as of October 20, 2017 (the “Employment Agreement”) will continue to control with respect to your salary, benefits and other matters
with respect to your employment with the Company; provided that you agree that during the period beginning on the Effective Date and ending on the Separation Date you will (i) subject to Section 1b., below, continue to perform your duties
as Chief Financial Officer of the Company, consistent with past practices, unless otherwise requested by the Board of Directors of Funko, Inc. (the “Board”), (ii) use your reasonable best efforts to (a) advance the
interests of the Company and facilitate the successful transition of your responsibilities to the individual who succeeds you as Chief Financial Officer in whatever reasonable capacity may be requested by the Board, consistent with your position as
Chief Financial Officer or your position as Special Advisor (as defined in Section 1b., below), as the case may be, (b) retain and develop employees in the Company’s Finance and Accounting functions, and (iii) communicate a
message consistent with the Board’s direction to key employees, investors, analysts, customers, suppliers, and other relevant third parties. You acknowledge and agree that you hereby resign as (x) Chief Financial Officer, effective as of
the earlier of (i) the Separation Date and (ii) the Transition Date (as defined below), (y) an employee of the Company and all of its subsidiaries, effective as of the Separation Date, and (z) from all other offices,
directorships, committees and positions of employment you may hold at the Company and its subsidiaries, effective as of the Separation Date (or such earlier date as requested by the Board). 

  
 - 1 - 

 Your services described above are herein referred to, collectively, as the
“Transition Services.” 
 b. In the event the date on which your successor as Chief Financial Officer of the Company
commences employment with the Company (the “Transition Date”) occurs prior to the Separation Date, then, as of the Transition Date, you shall cease to serve as Chief Financial Officer of the Company and, during the period beginning
on the Transition Date and ending on the Separation Date, you shall serve as an employee advisor to the Company (with the title of “Special Advisor”). During the period in which you serve as Special Advisor, the salary and benefits you
were eligible to receive immediately prior to the Transition Date shall continue in effect and you shall continue to provide the Transition Services described in Section 1a., above. 

2.    Transition Benefits. In addition to any payments and benefits due to you pursuant to Section 7.05(a) of
the Employment Agreement, you will, subject to (and in consideration for) your satisfactory provision of the Transition Services through the Separation Date (as reasonably determined in good faith by the Board), your execution and non-revocation of the Waiver and Release of Claims Agreement attached hereto as Exhibit A (the “Release”) and your continued compliance with the restrictive covenants (as described in
Section 3 below), be entitled to receive (i) the payments and benefits set forth in Section 7.05(b) of the Employment Agreement, which shall be subject to the terms of the Employment Agreement and, for the avoidance of doubt, will
consist of (a) continued base salary for 12 months following the Separation Date (the “Transition Payment Period”), which equals an aggregate amount of $400,000, less applicable withholdings, and (b) reimbursement
during the Transition Payment Period of the Company-paid portion of premium payments, as if you had remained an active employee, for any COBRA coverage that you timely elect, which shall be payable monthly; and (ii) (a) a prorated 2019
annual bonus based on actual individual and Company achievement targets as determined by the Board, which shall be payable within 30 days following the Separation Date, and (b) accelerated vesting of the following outstanding equity awards
held by you, each of which, to the extent such award has not otherwise theretofore become vested, shall become vested on the Separation Date: (x) 78,350 options in Funko, Inc., awarded to you on June 27, 2018 under the Company’s 2018
Executive Compensation Plan, and (y) 8,620 restricted stock units, awarded to you on June 27, 2018 under the Company’s 2018 Executive Compensation Plan (the payments and benefits set forth in (i) and (ii), collectively, the
“Transition Benefits”). Other than the equity awards described in the immediately preceding sentence, and any that may vest in accordance with their terms prior to the Separation Date, all Company equity-based compensation awards
held by you will be forfeited. 
 3.    Restrictive Covenants. You acknowledge that the Company is providing you
with the Transition Benefits in material part in consideration for your reaffirmation of your prior agreement to comply with the restrictive covenants set forth in Sections 5 and 6 of the Employment Agreement and that no payment will be made, and no
acceleration of vesting shall occur, following the date that you first violate any of the provisions of Sections 5 or 6 of the Employment Agreement. 

  
 - 2 - 

 4.    Release. The Transition Benefits are contingent upon and
subject to your execution and non-revocation of the Release following the Separation Date in accordance with Sections 7.05(b) of the Employment Agreement and the terms herein, and you agree to sign and be
bound by the Release which will be considered an integral part of this Letter Agreement. 
 5.    Entire
Agreement. This Letter Agreement sets forth the entire agreement between you and the Company with respect to the subject matter set forth herein and supersedes and replaces any and all prior oral or written agreements or understandings between
you and the Company with respect to the subject matter hereof; provided, that, for the avoidance of doubt, (a) you will retain your rights under the terms of the Employment Agreement, except to the extent such terms result in duplication
of compensation or benefits to you, and (b) the provisions of the Employment Agreement which by their terms survive termination of employment (including, without limitation, the restrictive covenants set forth in Sections 5 and 6 of the
Employment Agreement) will remain in full force and effect in accordance with their terms (as may be amended by this Letter Agreement). This Letter Agreement may be amended only by a subsequent writing signed by both parties. You represent that you
have signed this Letter Agreement knowingly and voluntarily. 
 [signature pages follow] 

  
 - 3 - 

 Please indicate your acceptance of the terms and provisions of this Letter Agreement by
signing both copies of this Letter Agreement and returning one copy to me. The other copy is for your files. By signing below, you acknowledge and agree that you have carefully read this Letter Agreement and Exhibit A thereto in their entirety;
fully understand and agree to their terms and provisions; will comply with the restrictive covenants set forth in Sections 5 and 6 of the Employment Agreement; and intend and agree that this Letter Agreement is final and legally binding on you
and the Company. All payments described in this Letter Agreement will be subject to the withholding of any amounts required by federal, state or local law. This Letter Agreement will be governed and construed under the internal laws of the State of
Washington and may be executed in several counterparts. 
  

	
	 Very truly yours,

	
	/s/ Andrew Perlmutter
	 Andrew Perlmutter

	 On behalf of Funko, Inc.

  
 Signature Page to
Transition and Release of Claims Agreement 

 Agreed, Acknowledged and Accepted as of the first date set forth above: 

 

	
	
	/s/ Russell Nickel
	 Russell Nickel

  
 Signature Page to
Transition and Release of Claims Agreement 

 EXHIBIT A 

WAIVER AND RELEASE OF CLAIMS AGREEMENT 

In exchange for the transition payments and benefits provided to me (the “Transition Benefits”) pursuant to that certain
Letter Agreement, dated as of [        ], 2019, by and between Funko, Inc. (“Company”) and Russell Nickel (the “Employee”) (this “Agreement”) the Employee
freely and voluntarily agrees to enter into and be bound by this Waiver and Release of Claims Agreement (this “Release”). 

1. General Release. The Employee, on his own behalf and on behalf of his spouse, child or children (if any), heirs, personal
representative, executors, administrators, successors, assigns and anyone else claiming through him (the “Releasors”), hereby releases and discharges forever Funko, Inc., and its affiliates, and each of their respective past,
present or future parent, affiliated, related, and subsidiary entities and each of their respective past, present or future directors, officers, employees, trustees, agents, attorneys, administrators, plans, plan administrators, insurers,
equityholders, members, representatives, predecessors, successors and assigns, and all Persons acting by, through, under or in concert with them (hereinafter collectively referred to as the “Released Parties”), from and against all
liabilities, claims, demands, liens, causes of action, charges, suits, complaints, grievances, contracts, agreements, promises, obligations, costs, losses, damages, injuries, attorneys’ fees and other legal responsibilities (collectively
referred to as “Claims”), of any form whatsoever (whether or not relating to Employee’s employment with the Company), including, but not limited to, any claims in law, equity, contract or tort, claims under any policy,
agreement, understanding or promise, written or oral, formal or informal, between the Employee and the Company or any of the other Released Parties, and any claims under the Civil Rights Act of 1866, the Civil Rights Act of 1871, the Civil Rights
Act of 1964, the Americans With Disabilities Act of 1990, the Age Discrimination in Employment Act of 1967 (“ADEA”), the Sarbanes-Oxley Act of 2002, the Securities Act of 1933, the Securities Exchange Act of 1934 (the “Exchange
Act”), the Employee Retirement Income Security Act of 1974, the Rehabilitation Act of 1973, the Family and Medical Leave Act of 1993, the Genetic Information Nondiscrimination Act of 2008, the Worker Adjustment and Retraining Notification Act
of 1988, the Delaware Discrimination in Employment Act, the Delaware Persons with Disabilities Employment Protection Act, the Delaware Whistleblowers’ Protection Act, the Delaware Wage Payment and Collection Act, the Delaware Fair Employment
Practices Act, Delaware’s social media law, the Washington Industrial Welfare Act, the Washington Minimum Wage Act, the Washington Wage Payment Act, the Washington Wage Rebate Act, the Washington Law Against Discrimination and the Washington
Leave Law, as each may have been amended from time to time, or any other federal, state or local statute, regulation, law, rule, ordinance or constitution, or common law, whether known or unknown, unforeseen, unanticipated, unsuspected or latent,
that the Employee or any of the Releasors now possess or have a right to, or have at any time heretofore owned or held, or may at any time own or hold by reason of any matter or thing arising from any cause whatsoever prior to the date of execution
of this Release, and without limiting the generality of the foregoing, from all claims, demands and causes of action based upon, relating to, or arising out of: (a) this Agreement; (b) that certain Employment Agreement, dated as of
October 20, 2017, by and among the Company and the Employee (the “Employment Agreement”), or Employee’s employment or other relationship with any of the Released Parties or the termination thereof; and (c) the
Employee’s status as a holder of securities of any of the 

  
 - 6 - 

 
Released Parties. This Release includes, but is not limited to, all wrongful termination and “constructive discharge” claims, all discrimination claims, all claims relating to any
contracts of employment, whether express or implied, any covenant of good faith and fair dealing, whether express or implied, and any tort of any nature. This Release is for any relief, no matter how denominated, including but not limited to wages,
back pay, front pay, benefits, compensatory, liquidated or punitive damages and attorneys’ fees. The Employee acknowledges and reaffirms Employee’s obligations under the Employment Agreement, including but not limited to Sections 5 and 6
thereof. 
 2.    Covenant Not To Sue. The Employee represents and covenants that he has not filed, initiated or
caused to be filed or initiated any Claim, charge, suit, complaint, grievance, action, cause of action or proceeding against the Company or any of other the Released Parties. Except to the extent that such waiver is precluded by law, the Employee
further promises and agrees that he will not file, initiate or cause to be filed or initiated any Claim, charge, suit, complaint, grievance, action, cause of action or proceeding based upon, arising out of or relating to any Claim released
hereunder, nor shall the Employee participate, assist or cooperate in any Claim, charge, suit, complaint, grievance, action, cause of action or proceeding regarding any of the Released Parties relating to any Claims released hereunder, whether
before a court or administrative agency or otherwise, unless required to do so by law. 
 3.    Exclusions.
Notwithstanding the foregoing, the Employee does not release his rights to receive the Transition Benefits or any right that may not be released by private agreement. In addition, this Release will not prevent the Employee from (i) filing a
charge or complaint with the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, the Securities and Exchange Commission or any other federal, state or local governmental
agency or commission (“Government Agencies”) or (ii) reporting possible violations of federal law or regulation to, otherwise communicating with or participating in any investigation or proceeding that may be conducted by, or
providing documents and other information, without notice to the Company, to, any Governmental Agency or entity, including in accordance with the provisions of and rules promulgated under Section 21F of the Exchange Act or Section 806 of
the Sarbanes-Oxley Act of 2002, as each may have been amended from time to time, or any other whistleblower protection provisions of state or federal law or regulation. This Agreement does not limit Employee’s right to receive an award for
information provided to any Government Agencies; provided, however, that the Employee acknowledges and agrees that any Claim by him, or brought on his behalf, for damages in connection with such a charge or investigation filed with the Equal
Employment Opportunity Commission would be and hereby is barred. 
 4.    No Assignment. The Employee represents
and warrants that he has made no assignment or other transfer, and covenants that he will make no assignment or other transfer, of any interest in any Claim that he may have against any of the Released Parties. 

5.    Indemnification of Released Parties. The Employee agrees to indemnify and hold harmless the Released Parties,
and each of them, against any loss, claim, demand, damage, expenses or any other liability whatsoever, including reasonable attorneys’ fees and costs, resulting from: (i) any 

  
 - 7 - 

 
breach of this Release by him or his successors in interest; (ii) any assignment or transfer, or attempted assignment or transfer, of any Claims released hereunder; or (iii) any action
or proceeding brought by him or his successors in interest, if such action or proceeding arises out of, is based upon, or is related to any Claims released hereunder. This indemnity does not require payment as a condition precedent to recovery by
any of the Released Parties. 
 6.    Acknowledgments. The Employee acknowledges that the Company delivered this
Release to him on [_____], 2019. The Employee agrees that the Company has advised him to consult with an attorney before executing this Release. The Employee agrees that he has had the opportunity to consult with counsel, if he chose to do so, and
that the Employee has had a sufficient and reasonable amount of time to read and consider this Release before executing it. The Employee acknowledges that he is responsible for any costs and fees resulting from his attorney reviewing this Release.
The Employee agrees that he has carefully read this Release and knows its contents, and that he signs this Release voluntarily, with a full understanding of its significance, and intending to be bound by its terms. The Employee acknowledges that the
provision of the Transition Benefits is in exchange for the promises in the Release and is not normally available under Company policy to employees who resign or are terminated by the Company, and that, but for his execution of this Release, he
would not be entitled to receive the Transition Benefits. The Employee further acknowledges that the provision of the Transition Benefits does not constitute an admission by the Released Parties of liability or of violation of any applicable law or
regulation. The Company and its affiliates expressly deny any liability or alleged violation and state that the Transition Benefits are being provided solely for the purpose of compromising any and all claims of the Employee without the cost and
burden of litigation. 
 7.    ADEA Provisions. The Employee understands that this Release includes a release of
claims arising under ADEA. The Employee acknowledges and agrees that he has had at least 21 days after the date of his receipt of this Release (such period, the “Consideration Period”) to review this Release and consider its
terms before signing this Release and that the Consideration Period will not be affected or extended by any changes, whether material or immaterial, that might be made to this Release. The Employee further acknowledges and agrees that he understands
that he may use as much or all of such 21-day period as he wishes before signing, and warrants that he has done so. The Employee may revoke and cancel this Release in writing at any time within seven days
after his execution of this Release (such seven-day period, the “Revocation Period”) by providing notice of revocation to Melisah Burke at melisah@funko.com. This Release shall not become
effective and enforceable until after the expiration of the Revocation Period; after such time, if there has been no revocation, this Release shall immediately be fully effective and enforceable. 

8.    Consequences of Breach or Revocation. The Employee agrees that, notwithstanding anything to the contrary in
this Release, in the event that he breaches any of the terms of the Release, or revokes the Release pursuant to Section 7, he shall forfeit the Transition Benefits and reimburse the Company for any portion of the Transition Benefits that have
already been paid, and, in the event of such a breach, he shall reimburse the Company for any expenses or damages incurred as a result of such breach. 

9.    Severability. If any provision of the Release is declared invalid or unenforceable, the remaining portions of
the Release shall not be affected thereby and shall be enforced. 

  
 - 8 - 

 10.    Governing Law: Venue. This Agreement is made under and
shall be governed by and construed in accordance with the laws of the State of Delaware 

  
 - 9 - 

 IN WITNESS WHEREOF, the undersigned has signed and executed this Release on the date set forth below as an
expression of his intent to be bound by the foregoing terms of this Release. 
  

			
	
	   

		
	Date:

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