Document:

EXHIBIT 10.3

 

 

BERKSHIRE BANK

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

FOR

SEAN A. GRAY

THIS SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT FOR SEAN A. GRAY (the “Agreement”) is effective as of January 1, 2019, and is entered into by Berkshire Bank (the “Bank”) and Sean A. Gray (“Executive”).

WHEREAS, the Executive is the Senior Executive Vice President of Berkshire Hills Bancorp, Inc. and the Executive was recently promoted to President of the Bank;

WHEREAS, the Bank wishes to enter into this Agreement with the Executive in order to provide additional retirement benefits to the Executive, who, as a member of senior management, has contributed significantly to the success of the Bank, and whose continued services are vital to the Bank’s continued growth and success; and

WHEREAS, this Agreement is intended to be an unfunded, non-qualified deferred compensation plan that complies with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations thereunder and is also intended to be a “top hat” pension plan within the meaning of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”).

ARTICLE I

DEFINITIONS

When used herein, the following words and phrases shall have the meanings below unless the context clearly indicates otherwise:

	
1.1

	
“Account” means an account to which the Bank shall credit all contributions.  The Account shall be utilized solely as a device for the determination and measurement of the amounts to be paid to Executive pursuant to the Agreement.  Executive’s Account shall not constitute or be treated as a trust fund of any kind.

	
1.2

	
“Account Balance” means the balance of Executive’s Account as of the applicable distribution date.

	
1.3

	
“Administrator” means the Compensation Committee of the Board of Directors (“Committee”).

	
1.4

	
“Bank” means Berkshire Bank and any successor to its business and/or assets which assumes and agrees to perform the duties and obligations under this Agreement by operation of law or otherwise.

	
1.5

	
“Beneficiary” means the person or persons designated by Executive as the beneficiary to whom the deceased Executive’s benefits are payable. The beneficiary designation shall be made on the form attached hereto as Exhibit A and filed with the Administrator.  If no Beneficiary is so designated, then the Executive’s estate will be deemed the Beneficiary.

	
1.6

	
“Benefit Eligibility Date” shall be the date on which Executive is entitled to commencement of benefits under the Agreement.

	
(a)

	
In the event benefits become payable on account of Executive’s Separation from Service, the Benefit Eligibility Date shall be the date of the Executive’s Separation from Service, subject to Section 1.6(d).

	
(b)

	
In the event the Survivor’s Benefit becomes payable under Section 2.4 on account of Executive’s death, the Benefit Eligibility Date shall be the first business day of the first month following Executive’s death.

	
(c)

	
In the event the Account Balance becomes payable pursuant to Section 2.6 on account of Executive’s Separation from Service (other than for Cause) in connection with or within two (2) years following a Change in Control, the Benefit Eligibility Date shall be the date of the Executive’s Separation from Service, subject to Section 1.6(d).

	
(d)

	
Notwithstanding anything in this Section 1.6 to the contrary, if Executive is a “specified employee” (within the meaning of Code Section 409A and the regulations and other guidance issued thereunder) and the payment(s) are due to Executive’s Separation from Service (other than due to death), then the Benefit Eligibility Date shall be the first day of the seventh month following Executive’s Separation from Service (if later than the date otherwise specified as the Benefit Eligibility Date).

	
1.7

	
“Board of Directors” shall mean the Board of Directors of the Bank.

	
1.8

	
“Cause” shall mean termination because of: (i) Executive’s personal dishonesty, willful misconduct, breach of fiduciary duty involving personal profit, intentional failure to perform stated duties, willful violation of any law, rule, regulation (other than traffic violations or similar offenses), final cease and desist order or material breach of any provision of this Agreement which results in a material loss to the Bank, or (ii) Executive’s conviction of a crime or act involving moral turpitude or a final judgment rendered against Executive based upon actions of Executive which involve moral turpitude.  For the purposes of this definition, no act, or the failure to act, on Executive’s part shall be considered “willful” unless done, or omitted to be done, not in good faith and without reasonable belief that the action or omission was in the best interests of the Bank or its affiliates.

	1.9	
“Change in Control” shall mean any of the following events: (i) a change in the ownership of Berkshire Hills Bancorp, Inc. (the “Company”) or the Bank; (ii) a change in the effective control of the Company or the Bank; or (iii) a change in the ownership of a substantial portion of the assets of the Company or the Bank, as described below:

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		(a)	
A change in ownership occurs on the date that any one person, or more than one person acting as a group (as defined in Treasury Regulations section 1.409A-3(i)(5)(v)(B)), acquires ownership of stock of the Bank or the Company that, together with stock held by such person or group, constitutes more than 50% of the total fair market value or total voting power of the stock of the Bank or the Company.

		(b)	
A change in the effective control of the Company or Bank occurs on the date that either (A) any one person, or more than one person acting as a group (as defined in Treasury Regulations section 1.409A-3(i)(5)(vi)(B)) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the Company or the Bank possessing 30% or more of the total voting power of the stock of the Company or the Bank, or (B) a majority of the members of the Bank’s or the Company’s Board of Directors is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Bank’s or the Company’s Board of Directors prior to the date of the appointment or election, provided that this subsection is inapplicable where a majority shareholder of the corporation is another corporation.

		(c)	
A change in the ownership of a substantial portion of the Bank’s or the Company’s assets occurs on the date that any one person or more than one person acting as a group (as defined in Treasury Regulations section 1.409A-3(i)(5)(vii)(C)) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the Company or the Bank that have a total gross fair market value equal to or more than 40% of the total gross fair market value of all of the assets of the Company or the Bank.  For purposes of this Agreement, “gross fair market value” means the value of the assets of the Company or the Bank, or the value of the assets being disposed of, without regard to any liabilities associated with such assets.

		(d)	
For all purposes hereunder, the definition of Change in Control shall be construed to be consistent with the requirements of Treasury Regulations section 1.409A-3(i)(5), except to the extent that such regulations are superseded by subsequent guidance.

	
1.10

	
“Code” means the Internal Revenue Code of 1986, as amended.

	
1.11

	
“Disability” means, with respect to Executive, that, in the good faith determination of the Bank:

	
(a)

	
Executive is unable to fulfill his employment responsibilities hereunder by reason of any medically determinable physical or mental impairment which can be expected to result in death or last for a continuous period of not less than 12 months;

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(b)

	
Executive is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering employees of the Bank.

	
1.12

	
“Effective Date” of this Agreement shall be January 1, 2019.

	
1.13

	
“Executive” means Sean A. Gray, who has been selected and approved by the Board of Directors to enter into the Agreement.

	
1.14

	
“Separation from Service” (or “Separated from Service”) means Executive’s death, retirement or other termination of employment with the Bank within the meaning of Code Section 409A.  No Separation from Service shall be deemed to occur due to military leave, sick leave or other bona fide leave of absence if the period of the leave does not exceed six months or, if longer, so long as Executive’s right to reemployment is provided by law or contract.  If the leave exceeds six months and Executive’s right to reemployment is not provided by law or by contract, then Executive shall have a Separation from Service on the first date immediately following such six-month period.

Whether a Separation from Service has occurred is determined based on whether the facts and circumstances indicate that the Bank and Executive reasonably anticipated that no further services would be performed after a certain date or that the level of bona fide services Executive would perform after that date (whether as an employee or as an independent contractor) would permanently decrease to less than 50% of the average level of bona fide services performed over the immediately preceding 36 months (or the lesser period of time in which Executive performed services for the Bank).  The determination of whether Executive has had a Separation from Service shall be made by applying the presumptions set forth in the Treasury Regulations under Code Section 409A.

	
1.15

	
“Survivor’s Benefit” means the benefit payable to Executive’s Beneficiary following his death in accordance with Section 2.4.

	
1.16

	
“Vested Account Balance” means the portion of Executive’s Account Balance that is vested in accordance with the Vesting Schedule.

	
1.17

	
“Vesting Schedule” means the rate at which the Executive’s Account Balance becomes vested and non-forfeitable.  The Executive’s Account Balance shall become vested as follows:

20% on January  1, 2020

20% on January  1, 2021

20% on January  1, 2022

20% on January  1, 2023

20% on January  1, 2024

 

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Notwithstanding the foregoing, the Account Balance shall immediately become 100% vested upon Executive’s death or Disability and upon a Separation from Service in connection with or within two years following a Change in Control.

ARTICLE II

BENEFITS

	2.1	
Account.  The Bank shall maintain an Account for Executive to which it shall credit all amounts allocated thereto in accordance with Section 2.2.  Executive’s Account shall be adjusted no less often than annually to reflect the credits made to the Account.  The adjustments shall be made as long any amount remains credited to the Account.  The amounts allocated and adjustments made shall comprise the Account at any time.

	2.2	
Annual Credits to Account.  The Bank shall credit Executive’s Account with $100,000 as of January 1, 2019, and an additional $100,000 on January 1st (the “Contribution Date”) of each 2020 through and including 2028, for a total maximum contribution of $1.0 million.  These annual contributions shall only be made if Executive is employed with the Bank as of the Contribution Date.  The Executive may not make any contributions under this Agreement and the Bank may, but is not obligated to, make discretionary contributions to Executive’s Account from time to time.  Discretionary contributions, if any, shall be credited at such times and in such amounts as determined by the Board of Directors in its sole discretion.  

	2.3	
Benefit on Separation from Service.  Upon Executive’s Separation from Service, Executive shall be entitled to the Vested Account Balance.  The benefit under this Section 2.3 shall be payable in a single lump sum on, or within five (5) business days following, the Benefit Eligibility Date specified in Section 1.6(a).

 

	2.4	
Survivor's Benefit.  

 

	
(a)

	
If Executive dies prior to a Separation from Service, Executive’s Beneficiary shall be entitled to the Account Balance, which became 100% vested upon the Executive’s death, payable in a single lump sum on, or within five (5) business days following the Benefit Eligibility Date specified in Section 1.6(b).

	
(b)

	
If Executive dies following a Separation from Service but prior to the payment of the Account Balance, Executive’s Beneficiary shall be entitled to the Account Balance payable in a single lump sum on, or within five (5) business days following the Benefit Eligibility Date specified in Section 1.6(b).

	2.5	
Termination for Cause and Voluntary Termination.  Notwithstanding any other provision of this Agreement to the contrary, if Executive is terminated for Cause, all benefits under this Agreement shall be forfeited by Executive and Executive’s participation in the Agreement shall become null and void.

	2.6	
Benefit Payable on Separation from Service in Connection With or Two Years Following a Change in Control.  In the event of the Executive’s Separation from Service (other than for Cause) in connection with or within two (2) years following a Change in Control, the Executive’s Account Balance shall be 100% vested and the amount of the Account Balance shall equal $1.0 million.  The Executive shall be paid the Account Balance on, or within five (5) business days following the Benefit Eligibility Date specified in Section 1.6(c) in a lump sum.

 

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ARTICLE III

BENEFICIARY DESIGNATION

Executive shall make an initial designation of primary and secondary Beneficiaries upon initial participation in the Agreement by completion of a Beneficiary form substantially in the form attached as Exhibit A, and shall have the right to change the designation, at any subsequent time. Any Beneficiary designation shall become effective only when receipt thereof is acknowledged in writing by the Administrator.

ARTICLE IV

EXECUTIVE’S RIGHT TO ASSETS,

ALIENABILITY AND ASSIGNMENT PROHIBITION

At no time shall Executive be deemed to have any lien, right, title or interest in or to any specific investment or asset of the Bank. The rights of Executive, any Beneficiary, or any other person claiming through Executive under this Agreement, shall be solely those of an unsecured general creditor of the Bank. Executive, the Beneficiary, or any other person claiming through Executive, shall only have the right to receive from the Bank those payments so specified under this Agreement. Neither Executive nor any Beneficiary under this Agreement shall have any power or right to transfer, assign, anticipate, hypothecate, mortgage, commute, modify or otherwise encumber in advance any of the benefits payable hereunder, nor shall any of said benefits be subject to seizure for the payment of any debts, judgments, alimony or separate maintenance owed by Executive or his Beneficiary, nor be transferable by operation of law in the event of bankruptcy, insolvency or otherwise.

ARTICLE V

ERISA PROVISIONS

	5.1	
Named Fiduciary and Administrator.  The Bank shall be the “Named Fiduciary” and the Committee shall be the Administrator of this Agreement. As Administrator, the Committee shall be responsible for the management, control and administration of the Agreement as established herein. The Committee may delegate to others certain aspects of the management and operational responsibilities of the Agreement, including the employment of advisors and the delegation of ministerial duties to qualified individuals.

	5.2	
Claims Procedure and Arbitration.  In the event that benefits under this Agreement are not paid to  Executive (or to his Beneficiary in the case of Executive’s death) and the claimant(s) feel he or they are entitled to receive the benefits, then a written claim must be made to the Administrator within sixty (60) days from the date payments are refused. The Administrator shall review the written claim and, if the claim is denied, in whole or in part, it shall provide in writing, within thirty (30) days of receipt of such claim, its specific reasons for such denial, reference to the provisions of this Agreement upon which the denial is based, and any additional material or information necessary for such claimants to perfect the claim. The written notice by the Administrator shall further indicate the additional steps which must be undertaken by claimants if an additional review of the claim denial is desired.

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If claimants desire a second review, they shall notify the Administrator in writing within thirty (30) days of the first claim denial. Claimants may review this Agreement or any documents relating thereto and submit any issues and comments, in writing, they may feel appropriate. In its sole discretion, the Administrator shall then review the second claim and provide a written decision within thirty (30) days of receipt of such claim. This decision shall state the specific reasons for the decision and shall include reference to specific provisions of this Agreement upon which the decision is based.

No claimant shall institute any action or proceeding in any state or federal court of law or equity or before any administrative tribunal or arbitrator for a claim for benefits under the Agreement until the claimant has first exhausted the provisions set forth in this Section 5.2.

ARTICLE VI

MISCELLANEOUS

	6.1	
No Effect on Employment Rights.  Nothing contained herein will confer upon Executive the right to be retained in the service of the Bank nor limit the right of the Bank to discharge or otherwise deal with Executive without regard to the existence of this Agreement.

	6.2	
State Law.  This Agreement is established under, and will be construed according to, the laws of the Commonwealth of Massachusetts, to the extent such laws are not preempted by ERISA and valid regulations published thereunder or any other federal law.

	6.3	
Severability and Interpretation of Provisions.  The Bank shall have full power and authority to interpret, construe and administer this Agreement and the Bank’s interpretation and construction thereof and actions thereunder shall be binding and conclusive on all persons for all purposes.  No employee or representative of the Bank shall be liable to any person for any actions taken or omitted in connection with the interpretation and administration of this Agreement unless attributable to his own willful misconduct or lack of good faith.  In the event that any of the provisions of this Agreement or portion hereof are held to be inoperative or invalid by any court of competent jurisdiction, or in the event that any provision is found to violate Code Section 409A and would subject Executive to additional taxes and interest on the amounts deferred hereunder, or in the event that any legislation adopted by any governmental body having jurisdiction over the Bank would be retroactively applied to invalidate this Agreement or any provision hereof or cause the benefits under this Agreement to be taxable, then: (1) insofar as is reasonable, effect will be given to the intent manifested in the provisions held invalid or inoperative, and (2) the validity and enforceability of the remaining provisions will not be affected thereby.  In the event that the intent of any provision shall need to be construed in a manner to avoid taxability, this construction shall be made by the Administrator in a manner that would manifest to the maximum extent possible the original meaning of such provisions.

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	6.4	
Incapacity of Recipient.  If a benefit is payable to a minor, to a person declared incompetent, or to a person incapable of handling the disposition of his property, the Bank may pay such benefit to the guardian, legal representative or person having the care or custody of such minor, incompetent person or incapable person.  The Bank may require proof of incompetence, minority or guardianship as it may deem appropriate prior to distribution of the benefit.  The distribution shall completely discharge the Bank for all liability with respect to the benefit.

	6.5	
Unclaimed Benefit.  Executive shall keep the Bank informed of his or her current address and the current address of his Beneficiaries. If the location of Executive is not made known to the Bank, the Bank shall delay payment of Executive’s benefit payment(s) until the location of Executive is made known to the Bank; however, the Bank shall only be obligated to hold the benefit payment(s) for Executive until the expiration of three (3) years. Upon expiration of the three (3) year period, the Bank may discharge its obligation by payment to Executive’s Beneficiary. If the location of Executive’s Beneficiary is not known to the Bank, Executive and his Beneficiary(ies) shall thereupon forfeit any rights to the balance, if any, of any benefits provided for such Executive and/or Beneficiary under this Agreement.

	6.6	
Limitations on Liability.   Notwithstanding any of the preceding provisions of the Agreement, no individual acting as an employee or agent of the Bank, or as a member of the Board of Directors shall be personally liable to Executive or any other person for any claim, loss, liability or expense incurred in connection with the Agreement.

	6.7	
Gender.  Whenever in this Agreement words are used in the masculine or neuter gender, they shall be read and construed as in the masculine, feminine or neuter gender, whenever they should so apply.

	6.8	
Effect on Other Corporate Benefit Agreements.  Nothing contained in this Agreement shall affect the right of Executive to participate in or be covered by any qualified or nonqualified pension, profit sharing, group, bonus or other supplemental compensation or fringe benefit agreement constituting a part of the Bank’s existing or future compensation structure.

	6.9	
Inurement.  This Agreement shall be binding upon and shall inure to the benefit of the Bank, its successors and assigns, and Executive, his successors, heirs, executors, administrators, and Beneficiaries.

	
6.10

	
Headings.  Headings and sub-headings in this Agreement are inserted for reference andconvenience only and shall not be deemed a part of this Agreement.

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6.11

	
12 U.S.C. §1828(k).  Any payments made to Executive pursuant to this Agreement or otherwise are subject to and conditioned upon compliance with 12 U.S.C. § 1828(k) or any regulations promulgated thereunder.

	
6.12

	
Payment of Employment Taxes.  Any distribution under this Agreement shall be reduced by the amount of any taxes required to be withheld from the distribution.

	
6.13

	
Successors to the Bank.  The Bank, as applicable, will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Bank to assume expressly and agree to perform the duties and obligations under this Agreement in the same manner and to the same extent as the Bank would be required to perform it if no such succession had taken place.

	
6.14

	
Legal Fees.  In the event Executive retains legal counsel to enforce any of the terms of the Agreement, the Bank will pay his legal fees and related expenses reasonably incurred by him, but only if Executive prevails in an action seeking legal and/or equitable relief against the Bank.

ARTICLE VII

AMENDMENT

	7.1	
This Agreement may not be amended or modified, in whole or part, without the mutual written consent of Executive and the Bank.  Notwithstanding anything to the contrary herein, the Agreement may be amended without Executive’s consent to the extent necessary to comply with existing tax laws or changes to existing tax laws.

ARTICLE VIII

EXECUTION

	8.1	
This Agreement sets forth the entire understanding of the Bank and Executive with respect to the transactions contemplated hereby, and any previous agreements or understandings between them regarding the subject matter hereof are merged into and superseded by this Agreement.

	8.2	
This Agreement shall be executed in duplicate, each copy of which, when so executed and delivered, shall be an original, but both copies shall together constitute one and the same instrument.

[signature page follows]

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IN WITNESS WHEREOF, the Bank has caused this Agreement to be executed, effective as of the day and date first above written.

	 	 	
BERKSHIRE BANK

	 	 	
 

 

	 /s/ Sean A. Gray	 	
By: /s/ Richard M. Marotta

	
SEAN A. GRAY

	 	
Title: Chief Executive Officer

	 	 	 
	
Date: February 21, 2019

	 	
Date: February 21, 2019

10Exhibit

SEPARATION AGREEMENT
This SEPARATION AGREEMENT (this “Agreement”) is entered into, as of the “Effective Date” (as defined in Section 7 below), by and between Andrew J. England (“Executive”) and National CineMedia, Inc. (the “Company”). Executive and the Company are each individually referred to herein as a “Party” and are collectively referred to as the “Parties”.
W I T N E S S E T H
WHEREAS, Executive was employed by the Company pursuant to an Employment Agreement, dated December 31, 2015, between the Company and Executive (the “Employment Agreement”);
WHEREAS, Executive’s employment with the Company terminated on November 2, 2018 (the “Separation Date”), and such termination of employment is being treated as an “Involuntary Termination” under the Employment Agreement and the Equity Awards (defined below);
WHEREAS, Executive holds certain shares of “Initial Equity” (as defined in the Employment Agreement) and has received from the Company certain other equity incentive awards previously granted to Executive with respect to the Company (the “Equity Awards”); and 
WHEREAS, the Parties wish to resolve all matters that Executive may have related to his employment and the termination of his employment.
NOW, THEREFORE, in consideration of the premises and the releases, representations, covenants and obligations herein contained, the Parties, intending to be legally bound, hereby agree as follows:
1.Separation
(a)Executive’s employment with the Company and all of its “Affiliates” (as defined in the Employment Agreement) terminated on the Separation Date. Pursuant to Section 4(a) of the Employment Agreement, Executive is deemed to have resigned from the Board of Directors of the Company and all other positions with the Company and any of its Affiliates that Executive held as of the date immediately preceding the Separation Date. Executive agrees to promptly execute such additional documentation as requested by the Company to effectuate such resignations.
(b)Pursuant to Section 4(b) of the Employment Agreement, Executive shall cease to have any rights to salary, bonus or other benefits, other than (i) the earned but unpaid portion of Executive’s “Base Salary” (as defined below) through the Separation Date, (ii) any annual, long-term, or other incentive award that relates to a completed fiscal year or performance period, as applicable, and is payable (but not yet paid) on or before the Separation Date, which shall be paid in accordance with the terms of such award, (iii) a lump-sum payment in respect of accrued but unused vacation days at the Executive’s per-business-day Base Salary rate, (iv) any unpaid expense or other reimbursements due to Executive (subject to Section 1(e) below), and (v) any other amounts or benefits required to be paid or provided by law or under any plan, program, policy or practice of the Company, provided that Executive shall not be entitled to any payment or benefit under any Company severance plan, or any replacement or successor plan.
(c)All amounts paid to Executive under this Agreement will be less applicable withholdings and authorized or required deductions.
(d)Executive will receive under separate cover information regarding his rights under the Consolidated Omnibus Budget Reconciliation Act and, if applicable, any state continuation coverage laws (collectively, “COBRA”).
(e)Executive shall submit for reimbursement any outstanding business-related expenses for reimbursement under Company policy within ten (10) days following the Separation Date.

2.Severance
Provided that Executive complies with Section 6 (Restrictive Covenants) of the Employment Agreement at all times, and subject to Section 4(d) (No Excise Tax Gross-Up; Possible Reduction in Payments), Section 15 (Code Section 409A) and Section 16 (Clawbacks) of the Employment Agreement, the Company shall comply with Section 4(c) of the Employment Agreement as follows:
(a)the Company shall pay Executive on January 2, 2019, a lump-sum cash payment in an amount equal to $2,625,000, which is comprised of (i) $1,750,000, which is 200% of Executive’s base salary of $875,000 (the “Base Salary”); and (ii) $875,000, which is 100% of Executive’s “Target Bonus” (as defined in the Employment Agreement);
(b)the Company shall pay Executive an annual cash bonus for 2018, payable at the same time as annual cash bonuses are paid to senior management, based on actual achievement of performance targets (as if Executive had remained employed through the end of the applicable performance period), subject, however, to proration based on the number of days in the applicable performance period that had elapsed prior to the date of termination, which is 308 days, or 84.615%;
(c)the Initial Equity shall vest in full; and
(d)for a period up to eighteen (18) months, the Company (or its successor-in-interest) shall pay Executive monthly an amount equal to 150% of the monthly premium paid by the Executive for COBRA coverage elected by Executive (as may be applicable to Executive, Executive’s spouse and dependents) under the Company’s group health and dental plans.
3.Treatment of Equity Awards
With respect to the Equity Awards, all rights will be determined under the terms and conditions of the National CineMedia, Inc. 2016 Equity Incentive Plan or the National CineMedia, Inc. 2007 Equity Incentive Plan, as applicable (the “Equity Plans”) and the award agreements and other documents governing the applicable Equity Awards. Appendix A to this Agreement sets forth the Equity Awards currently held by Executive under the Equity Plans and the impact of Executive’s termination of employment on the Separation Date on such Equity Awards.
4.Legal Expenses
The Company agrees to reimburse Executive for the costs and expenses incurred by Executive with respect to legal representation in respect of this Agreement, up to $25,000, with such amount to be paid directly to the Employee’s attorney within thirty (30) days of submission of the invoice for such services
5.Release
(a)Executive, hereby waives, releases and forever discharges the Company and any of its predecessors, parents, subsidiaries, affiliates and related companies including but not limited to NCM Inc., NCM LLC, and all its and their respective past and present parents, subsidiaries and affiliates and all of their past and present employees, directors, officers, members, attorneys, representatives insurers, agents, shareholders, successors and assigns (individually and collectively “Company Releasees”), from and with respect to any and all legally waivable claims, grievances, injuries, controversies agreements, covenants, promises, debts, accounts, actions, causes of action, suits, arbitrations, sums of money, attorneys’ fees, costs, damages or any right to monetary recovery or any other personal relief, whether known or unknown, in law or equity, by contract, tort or pursuant to federal state or local statute, regulation, ordinance, or common law, which Executive now has, ever had, or may hereafter have, based upon or arising from any fact or set of facts, whether known or unknown to Executive, from the beginning of time until the date of this Agreement with respect to Executive’s employment with the Company and the termination of such employment. Without limiting the generality of the foregoing, this waiver, release, and discharge includes any claim or right which could have been asserted against the Company by Executive, and/or based upon or arising 

under any contract or any federal, state or local tort, fair employment practices, equal opportunity or wage and hours laws including but not limited to the common law of the State of Colorado, Title VII of the Civil Rights Act of 1964, the Colorado Anti-Discrimination Act, the Americans with Disabilities Act, the Age Discrimination in Employment Act, 42 U.S.C Section 1981, the Fair Labor Standards Act, the Colorado Wage Act, and the Employee Retirement Income Security Act, including all amendments thereto.
(b)Notwithstanding the generality of the foregoing, nothing herein constitutes a waiver by Executive of: (1) any claim or right that may arise after the date of this Agreement; (2) any vested benefits due to Executive pursuant to the terms and conditions of any Company employee benefit plan in which Executive was a participant on or prior to the Separation Date; (3) any claim or right Executive may have pursuant to indemnification, advancement, defense, or reimbursement pursuant to any applicable D&O policies, any similar insurance policies, the Company’s amended and restated by-laws as amended or applicable law, or as provided in Section 18 of the Employment Agreement, and (4) any claim which by law cannot be waived.
(c)Nothing in this Agreement is intended to prohibit or restrict Executive’s right to file a charge with or participate in a charge by the Equal Employment Opportunity Commission, or any other local, state, or federal administrative body or government agency that is authorized to enforce or administer laws related to employment; provided that Executive hereby waives the right to recover any monetary damages or other relief against any Released Parties; provided, however, that nothing in this Agreement shall prohibit Executive from receiving any monetary award to which Executive becomes entitled pursuant to Section 922 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
6.Return of Company Property
Executive acknowledges that he has reasonably searched for all “Proprietary or Confidential Information” (as defined in the Employment Agreement) and all other property belonging to the Company Entities or which Executive prepared or obtained during the course of his employment with the Company Entities, including, but not limited to, phones, computers, keys, access cards, security devices, network access devices, electronic devices, office equipment, records, identification cards, files, data, manuals, reports, books, compilations, work product, email messages, recording, tapes, removable storage devices, hard drives, computer disks, rolodexes, credit cards, electronic passwords and documents containing the Company Entities’ confidential or business information, whether in hard copy or electronic format, and has returned to the Company all such found property. If Executive discovers any Proprietary or Confidential Information or property belonging to the Company Entities after the Separation Date, Executive shall promptly return them to the Company. The foregoing provisions of this Section 6, shall exclude all compensation plans, programs, and agreements, and all other personnel related materials relating to Executive’s employment with the Company.
7.Consultation; Voluntary Agreement
Executive acknowledges that the Company has advised Executive to consult with an attorney prior to executing this Agreement. Executive has carefully read and fully understands all of the provisions of this Agreement. Executive is entering into this Agreement, knowingly, freely and voluntarily in exchange for good and valuable consideration to which Executive would not be entitled in the absence of executing and not revoking this Agreement.
8.Consideration and Revocation Period
Executive acknowledges that he has twenty-one (21) calendar days to consider this Agreement, although he may sign it sooner. Executive has seven (7) calendar days after the date on which Executive executes this Agreement to revoke his consent to the Agreement. Such revocation must be in writing and must be emailed to Kirkland & Ellis LLP, Richard Kidd, Esq., at richard.kidd@kirkland.com. Notice of such revocation must be received within the seven (7) calendar days referenced above. In the event of such 

revocation by Executive, this Agreement shall be null and void in its entirety. Provided that Executive does not revoke his execution of this Agreement within such seven (7) day period, the “Effective Date” shall occur on the eighth (8th) calendar day after the date on which he initially signs it. If the Effective Date does not occur, this Agreement is null and void and neither the Company nor Executive shall have any rights or obligations under this Agreement.
9.Permitted Disclosures; Defend Trade Secrets Act
Nothing in this Agreement, the Employment Agreement or any policies or procedures of the Company shall prohibit or restrict Executive or his attorneys from: (a) making any disclosure of relevant and necessary information or documents in any action, investigation, or proceeding relating to this Agreement, or as required by law or legal process, including with respect to possible violations of law; (b) participating, cooperating, or testifying in any action, investigation, or proceeding with, or providing information to, any governmental agency or legislative body, any self-regulatory organization, and/or pursuant to the Sarbanes-Oxley Act; or (c) accepting any U.S. Securities and Exchange Commission awards. In addition, nothing in this Agreement prohibits or restricts Executive from initiating communications with, or responding to any inquiry from, any regulatory or supervisory authority regarding any good faith concerns about possible violations of law or regulation. Pursuant to 18 U.S.C. § 1833(b), Executive will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret of the Company or its subsidiaries or affiliates that (A) is made (x) in confidence to a federal, state, or local government official, either directly or indirectly, or to Executive’s attorney and (y) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document that is filed under seal in a lawsuit or other proceeding. If Executive files a lawsuit for retaliation by the Company for reporting a suspected violation of law, Executive may disclose the trade secret to Executive’s attorney and use the trade secret information in the court proceeding, if Executive files any document containing the trade secret under seal, and does not disclose the trade secret, except pursuant to court order. Nothing in this Agreement is intended to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by such section. Executive does not need the prior authorization of the Company to engage in conduct protected by this Section 8, and Executive does not need to notify the Company that Executive has engaged in such conduct, has received a subpoena or responded to a subpoena.
10.Cooperation; No Cooperation with Non-Governmental Third Parties
To the extent not contrary to Executive’s legal interests (as determined in Executive’s reasonable discretion), Executive agrees that, at the Company’s request, and consistent with Executive’s business and personal schedule, Executive shall provide reasonable assistance to, and cooperate with, the Company with regard to any internal or external claims, charges, audits, investigations, contractual disputes and/or lawsuits involving Executive, or of which Executive may have knowledge, or in which Executive may be a witness with respect to events occurring on or prior to the Separation Date. Such cooperation includes meeting with Company representatives and counsel to disclose such facts as Executive may know; preparing for any deposition, trial, hearing, or other proceedings; attending any deposition, trial, hearing or other proceeding to provide truthful testimony; and providing other assistance to the Company and its counsel in the defense or prosecution of litigation as may, in their sole judgment, be necessary. To the extent permitted by applicable law, the Company shall pay Executive at an hourly rate of $1,000 per hour, with such compensation to be paid in increments of four (4) hours for all approved time cooperating without the need to subpoena Executive and shall reimburse Executive for all reasonable business expenses incurred with respect to such cooperation (including, if Executive reasonably needs counsel, the reasonable legal fees for counsel selected by Executive in his reasonable discretion). Executive shall not knowingly encourage, counsel or assist any non-governmental attorneys or their clients in the presentation or prosecution of any disputes, differences, grievances, claims, charges or complaints by any non-governmental third party against any of the Released 

Parties relating to events occurring on or prior to the Separation Date, in each case, only where Executive would be precluded by Section 5 of this Agreement from taking such action on his own behalf.
11.No Admission of Wrongdoing
The Parties agree that neither this Agreement, nor the furnishing of the consideration for this Agreement, shall be deemed or construed at any time to be an admission by either Party of any improper or unlawful conduct.
12.Surviving Provisions of Employment Agreement
The Parties acknowledge and agree that the following sections of the Employment Agreement shall remain in full force and effect: Section 5 (Definitions); Section 6 (Restrictive Covenants); Section 7 (Survival); Section 8 (Notices); Section 9 (Entire Agreement) (subject to this Agreement being part of the entire agreement between the Parties); Section 11 (Successors and Assigns); Section 15 (Code Section 409A), Section 16 (Clawbacks), and Section 18 (Indemnification).
13.Savings Clause
If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon such determination that any term or other provision of this Agreement is invalid, illegal or unenforceable, this Agreement shall be enforceable as closely as possible to its original intent, which is to provide the Company Releasees with a full release of all legally releasable claims as provided herein.
14.Counterparts
This Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument. A faxed, .pdf-ed or electronic signature shall operate the same as an original signature.
15.Amendment and Waiver
The provisions of this Agreement may be amended or waived only with the prior written consent of the Company and Executive, and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall affect the validity, binding effect or enforceability of this Agreement.
16.Successors and Assigns; Third-Party Beneficiaries
This Agreement shall inure to the benefit of and be enforceable by Executive and his heirs, executors and personal representatives, and the Company and its successors and assigns. Any successor or assignee of the Company shall assume the liabilities of the Company hereunder. The Company Releasees are expressly intended to be third-party beneficiaries of the releases set forth in Section 4 above, and it may be enforced by each of them.
17.No Oral Modifications
This Agreement may not be modified or amended unless mutually agreed to in writing by the Parties.
18.Governing Law, Alternative Dispute Resolution
This Agreement and the surviving provisions of the Employment Agreement shall be governed by the internal laws (as opposed to the conflicts of law provisions) of the State of Colorado. The Parties agree that any and all disputes, claims or controversies arising out of or relating to this Agreement and the surviving provisions of the Employment Agreement (other than with respect to Section 6 of the Employment Agreement) shall be submitted to JAMS, (Denver, Colorado office) or its successor, for mediation. Either Party may commence mediation by providing to JAMS and the other Party a written request for mediation, setting forth 

the subject of the dispute and the relief requested. The Parties will cooperate with JAMS and with one another in selecting a mediator from the JAMS panel of neutrals and in scheduling the mediation proceedings. The Parties agree that they will participate in the mediation in good faith and that all mediation costs will be borne by the Company. All offers, promises, conduct and statements, whether oral or written, made in the course of the mediation by any of the Parties, their agents, employees, experts and attorneys, and by the mediator or any JAMS employees, are confidential, privileged and inadmissible for any purpose, including impeachment, in any proceeding involving the Parties, provided that evidence that is otherwise admissible or discoverable shall not be rendered inadmissible or non-discoverable as a result of its use in the mediation.
19.Entire Agreement
This Agreement, the surviving provisions of the Employment Agreement, the Equity Awards, Equity Plans and the award agreements and other documents governing the applicable Equity Awards constitute the entire agreement and understanding between the Parties with respect to their subject matter and supersede and preempt any prior understandings, agreements or representations by or between the Parties, written or oral, which may have related in any manner to their subject matter.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the below-indicated dates.
	
			
	 
	EXECUTIVE
	 

	 
	 
	 

	By:
	 /s/ Andrew J. England
	 

	 
	Andrew J. England
	 

	 
	 
	 

	 
	 
	 

	Date:
	November 15, 2018
	 

	 
	 
	 

	
		
	 
	NATIONAL CINEMEDIA, INC.

	 
	 

	By:
	/s/ Clifford E. Marks

	Name:
	Clifford E. Marks

	Title:
	Interim Chief Executive Officer and President

	 
	 

	Date:
	November 14, 2018

	 
	 

APPENDIX A TO SEPARATION AGREEMENT
National CineMedia, Inc.
Potential Value of Shares to Vest upon Involuntary Termination without Cause for CEO
For the avoidance of doubt, the estimated calculations below assume that the performance conditions for the performance-based restricted stock awards at the end of the three-year performance period are achieved at target; however, all of the Executive’s performance-based restricted stock awards will pro-rata vest based on actual (not target) achievement of the  applicable performance conditions at the end of the three-year performance period. Target is being assumed below for performance-based restricted stock awards solely for  illustrative and modeling purposes and does not reflect the actual (or expected) achievement of such awards (or the actual amounts that the Executive may receive) at the end of the applicable three-year performance period.  This Appendix A is in no way intended to supersede or override any of the terms and conditions of the Equity Awards pursuant to the Equity Plans and applicable award agreements, and the Equity Plans and the award agreements will continue to govern the Equity Awards following the Separation Date.
	
										
	($000s)
	 
	 
	 
	 
	Shares to Vest

	 
	 
	 
	 
	 
	Upon Termination

	Grant Detail
	 
	Number of Shares
	Vesting Date
	Proration Ratio(2)
	# of Shares Vesting
	Current Value of Shares(3)
	Accrued Dividends
	Total Value

	Grant Date
	Granted
	Unvested(1)

	2016 (Initial TBRS)(4)
	1/1/2016
	48,109
	16,037
	1/1/2019
	1.00
	16,037
	$138
	$36
	$174

	2016 (Annual TBRS of 24,983 Total Shares)
	1/20/2016
	 
	 
	 
	 
	 
	 
	 
	 

	1st tranche (vests 1 year from grant date)
	 
	8,327
	0
	1/20/2017
	0
	0
	0
	0
	0

	2nd tranche (vests 2 years from grant date)
	 
	8,328
	0
	1/20/2018
	0
	0
	0
	0
	0

	3rd tranche (vests 3 years from grant date)
	 
	8,328
	8,328
	1/20/2019
	0.93
	7,728
	$67
	$18
	$84

	2016 
(Annual PBRS)(5)
	1/20/2016
	74,950
	74,950
	2/25/2019(6)
	0.90
	67,336
	$580
	$153
	$733

	2017 (Annual TBRS of 25,338 Total Shares)
	1/19/2017
	 
	 
	 
	 
	 
	 
	 
	 

	1st tranche (vests 1 year from grant date)
	 
	8,446
	0
	1/19/2018
	0
	0
	0
	0
	0

	2nd tranche (vests 2 years from grant date)
	 
	8,446
	8,446
	1/19/2019
	0.89
	7,544
	$65
	$10
	$75

	3rd tranche (vests 3 years from grant date)
	 
	8,446
	8,446
	1/19/2020
	0.60
	5,029
	$43
	$7
	$50

	2017 
(Annual PBRS)(5)
	1/19/2017
	76,013
	76,013
	2/24/2020(6)
	0.58
	43,820
	$377
	$61
	$438

	2018 (Annual TBRS of 56,818 Total Shares)
	1/24/2018
	 
	 
	 
	 
	 
	 
	 
	 

	1st tranche (vests 1 year from grant date)
	 
	18,939
	18,939
	1/24/2019
	0.77
	14,632
	$126
	$7
	$133

	2nd tranche (vests 2 years from grant date)
	 
	18,939
	18,939
	1/24/2020
	0.39
	7,316
	$63
	$4
	$67

	3rd tranche (vests 3 years from grant date)
	 
	18,940
	18,940
	1/24/2021
	0.26
	4,873
	$42
	$2
	$44

	2018 (Annual PBRS)(5)
	1/24/2018
	170,455
	170,455
	3/1/2021(6)
	0.25
	42,463
	$366
	$22
	$387

	 
	 
	 
	 
	 
	 
	 
	 
	 
	 

	Total
	 
	476,666
	419,493
	 
	 
	216,778
	$1,866
	$321
	$2,187

		
	Note:
	TBRS = Time-Based Restricted Stock, PBRS = Perf-Based Restricted Stock

(1) Number of shares unvested prior to termination date
(2) Assumes an Involuntary Termination without Cause on November 2, 2018. Proration ratio is calculated as the number of days from grant to termination, divided by the number of days from grant to vesting

(3) Current value of shares is based on the closing stock price on November 2, 2018 ($8.61)
(4) Initial sign-on equity grant (vesting 1/3rd per year) subject to accelerated vesting in the event of an Involuntary Termination without Cause, per Employment Agreement
(5) PBRS vest based upon achievement of performance targets at the end of a 3-year measurement period; for modeling purposes above, amount shown is illustrative with performance assumed at target
(6) For purposes of calculating the proration ratio, the vesting date for the PBRS is 60th day following the last day of the applicable Measuring Period, per the CEO’s Award Agreements

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