Document:

Exhibit

Exhibit 10.1

NATUS MEDICAL INCORPORATED
LESLIE MCDONNELL EMPLOYMENT AGREEMENT
This Agreement is entered into as of January 3, 2018 (“Effective Date”), by and between Natus Medical Incorporated (“Company”), and Leslie McDonnell (“Executive”).
1.Duties and Scone of Employment.
(a)Positions and Duties. As of the Effective Date, Executive will serve as Vice President and General Manager (“VP/GM”), Newborn Care of the Company. Executive will render such business and professional services in the performance of her duties, consistent with Executive’s position within the Company, as shall reasonably be assigned to her by the Company’s Chief Executive Officer (“CEO”). The period of Executive’s employment under this Agreement is referred to herein as the “Employment Term.”
(b)Obligations. During the Employment Term, Executive will perform her duties faithfully and to the best of her ability and will devote her full business efforts and time to the Company. For the duration of the Employment Term, Executive agrees not to actively engage in any other employment, occupation or consulting activity for any direct or indirect remuneration without the prior approval of the CEO.
2.At-Will Employment. The parties agree that Executive’s employment with the Company will be “at-will” employment and may be terminated at any time with or without cause or notice. Executive understands and agrees that neither her job performance nor promotions, commendations, bonuses or the like from the Company give rise to or in any way serve as the basis for modification, amendment, or extension, by implication or otherwise, of her employment with the Company.
3.Compensation.
(a)Base Salary. During the Employment Term, the Company will pay Executive an annual salary of
$325,000 as compensation for her services (the “Base Salary”). The Base Salary will be paid periodically in accordance with the Company’s normal payroll practices and be subject to the usual, required withholding. Executive’s salary will be subject to review and adjustments will be made based upon the Company’s normal performance review practices.
(b)Performance Bonus. Executive shall be eligible to receive a cash bonus pursuant to the Company’s Executive Management Incentive Plan (“EMIP”). In 2018, this bonus shall be at 50% of Executive’s pro-rated base salary. Thereafter, plan awards will be subject to the then-current EMIP.
(c)Equity Awards. Subject to approval by the Board of Directors of the Company, Executive shall receive an initial grant of $500,000 worth of restricted stock pursuant to and governed by the terms of the Company’s 2011 Stock Awards Plan, which shares shall vest at the rate of 50% on the first anniversary of the grant and 50% on the second anniversary of the grant. Final share amount shall be determined based on Executives date of hire. Executive shall be eligible for future equity awards commencing in 2018 as determined by the Compensation Committee of the Company’s Board of Directors.
4.Employee Benefits. During the Employment Term, Executive will be entitled to participate in the employee benefit plans currently and hereafter maintained by the Company of general applicability to other employees of the Company, including, without limitation, the Company’s group medical, dental, vision, disability, life insurance, and flexible-spending account plans consistent with the terms of such plans. The Company reserves the right to cancel or change the benefit plans and programs it offers to its employees at any time.
5.Paid Time Off (“PTO”). Executive is entitled to receive no less than four weeks of PTO pursuant to Natus’ standard benefit policy currently and hereafter maintained by the Company, and as may be cancelled or changed from time to time.
6.Expenses. The Company will reimburse Executive for reasonable travel, entertainment or other expenses incurred by Executive in the furtherance of or in connection with the performance of Executive’s duties hereunder, in accordance with the Company’s expense reimbursement policy as in effect from time to time.

7.Severance.
(a)Involuntary Termination. If Executive’s employment with the Company terminates other than for “Cause” (as defined herein), death or disability, and Executive signs and does not revoke a standard release of claims with the Company, then, subject to Section 11, Executive shall be entitled to (i) receive continuing payments of severance pay (less applicable withholding taxes) at a rate equal to her Base Salary rate, as then in effect, for a period equal to twelve
(12) months from the date of Executive’s “separation from service” (as defined in Treas. Reg. 1.409A-1(h)) with the Company, to be paid periodically in accordance with the Company’s normal payroll policies and commencing with the latest payroll date that is also within seventy (70) days from the date of “separation from service” provided that the required release is effective on such date (with payments that would have been made on earlier payroll dates, but for this provision, cumulated and paid on such payroll date); (ii) the immediate vesting and exercisability of 100% of the shares subject to all of Executive’s restricted stock awards (whether currently outstanding or granted in following the Effective Date) outstanding on the date of such termination (the “Stock Awards”); (iii) continued payment by the Company of the group health continuation coverage premiums for Executive and Executive’s eligible dependents under Title X of the Consolidated Budget Reconciliation Act of 1985, as amended (“COBRA”) as in effect through the lesser of (x) twelve
(12) months from the effective date of such termination, (y) the date upon which Executive and Executive’s eligible dependents become covered under similar plans, or (z) the date Executive no longer constitutes a “Qualified Beneficiary” (as such term is defined in Section 4980B(g) of the Internal Revenue Code of 1986, as amended (the “Code”); provided, however, that Executive will be solely responsible for electing such coverage within the required time periods.
(b)Voluntary Termination; Termination for Cause. If Executive’s employment with the Company terminates voluntarily by Executive (other than as described in subsection (c) below) or for Cause by the Company or due to Executive’s death or disability, then (i) all vesting of restricted stock will immediately cease, (ii) all payments of compensation by the Company to Executive hereunder will terminate immediately (except as to amounts already earned), and (iii) Executive will only be eligible for severance benefits, if any, in accordance with the Company’s established policies as then in effect.
(c)Change of Control Benefits. If within six (6) months following a “Change of Control” (as defined below)
(i) Employee terminates Employee’s employment with the Company for Good Reason after providing the Company with written notice within the ninety (90) days after the occurrence of an event constituting Good Reason and an opportunity for the Company to cure such occurrence of not less than thirty (30) days, or (ii) the Company or the successor corporation terminates Employee’s employment with the Company for other than Cause, death or disability, then Employee shall be entitled to the benefits provided for in subsection (a) above, except that the amount of the cash payments provided for in (a)(i) above shall be replaced by cash payments equal to the sum of (x) the greater of Employee’s Base Salary as in effect immediately prior to the date of the Company’s entering into an agreement providing for such Change of Control (or, if no such agreement is entered into, immediately prior to the Change of Control), or Employee’s Base Salary as in effect at the time of Employee’s termination after the date of the Change of Control, and (y) the greater of Employee’s target bonus as most recently established by the Board or Compensation Committee prior to the date of the Company’s entering into an agreement providing for such Change of Control (or, if no such agreement is entered into, prior to the date of the Change of Control), or Employee’s target bonus as in effect at the time of Employee’s termination after the date of the Change of Control. Employee shall only be permitted to receive the benefits provided for in subsection (a) once and shall not be permitted to claim such benefits under both subsection (a) and (c) such that Employee would receive the benefits pursuant to subsection (a) twice. The payment- characterization provisions made under subsection (a) above for purposes of Section 409A of the Code shall apply as well. For the avoidance of doubt, the form of payment (i.e., continuing payments) is intended to be the same for this subsection (c) as the form of payment provided for in subsection (a) above
8.Limitation on Payments. In the event that the severance and other benefits provided for in this Agreement or otherwise payable to the Executive (i) constitute “parachute payments” within the meaning of Section 280G of the Code and (ii) but for this Section 8, would be subject to the excise tax imposed by Section 4999 of the Code, then the Executive’s severance benefits under Section 4(a)(i) shall be either:
		
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	delivered in full, or

		
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	delivered as to such lesser extent which would result in no portion of such severance benefits being subject to excise tax under Section 4999 of the Code, whichever of the foregoing amounts, taking into account the applicable federal, state and local income taxes and the excise tax imposed by Section 4999, results in the receipt by Executive on an after-tax basis, of the greatest amount of severance benefits, notwithstanding that

all or some portion of such severance benefits may be taxable under Section 4999 of the Code. Unless the Company and Executive otherwise agree in writing, any determination required under this Section 8 shall be made in writing by the Company’s independent public accountants immediately prior to Change of Control (the “Accountants”), whose determination shall be conclusive and binding upon Executive and the Company for all purposes. For purposes of making the calculations required by this Section 8, the Accountants may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of Sections 280G and 4999 of the Code. The Company and Executive shall furnish to the Accountants such information and documents as the Accountants may reasonably request in order to make a determination under this Section. The Company shall bear all costs the Accountants may reasonably incur in connection with any calculations contemplated by this Section 8. If payment is to be in a lesser amount then reduction shall occur in the following order: (i) reduction of payments of cash; and (ii) reduction in equity awards; and in each category reduction shall be pro rata between those payments subject to Section 409A and payments not subject to Section 409A.
9.Definitions.
(a)Cause. For purposes of this Agreement, “Cause” shall mean (i) any act of personal dishonesty taken by Executive in connection with her responsibilities as an Executive and intended to result in substantial personal enrichment of Executive, (ii) Executive’s conviction of a felony, (iii) a willful act by Executive which constitutes gross misconduct and which is injurious to the Company, or (iv) continued substantial violations by Executive of Executive’s employment duties which are demonstrably willful and deliberate on Executive’s part after there has been delivered to Executive a written demand for performance from the Company which specifically sets forth the factual basis for the Company’s belief that Executive has not substantially performed Executive’s duties.
(b)Change of Control. For purposes of this Agreement, “Change of Control” of the Company is defined as:
(i)any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) is or becomes the “beneficial owner” (as defined in Rule 13d-3 under said Act), directly or indirectly, of securities of the Company representing 50% or more of the total voting power represented by the Company’s then outstanding voting securities; or
(ii)a change in the composition of the Board occurring within a two-year period, as a result of which fewer than a majority of the directors are Incumbent Directors. “Incumbent Directors” will mean directors who either (A) are directors of the Company as of the date hereof, or (B) are elected, or nominated for election, to the Board with the affirmative votes of at least a majority of the Incumbent Directors at the time of such election or nomination (but will not include an individual whose election or nomination is in connection with an actual or threatened proxy contest relating to the election of directors to the Company); or
(iii)the date of the consummation of a merger or consolidation of the Company with any other corporation that has been approved by the stockholders of the Company, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than forty percent (40%) of the total voting power represented by the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation, or the stockholders of the Company approve a plan of complete liquidation of the Company; or
(iv)the date of the consummation of the sale or disposition by the Company of all or substantially all the Company’s assets.
(c)Good Reason. For purposes of this Agreement, “Good Reason” shall mean any of the following actions taken without the Executive’s express written consent: (i) the material reduction of the Executive’s duties or responsibilities relative to Executive’s duties or responsibilities in effect immediately prior to such reduction; provided, however, that a reduction in duties or responsibilities solely by virtue of the Company being acquired and made part of a larger entity (as, for example, when the Chief Financial Officer of Natus Medical Incorporated remains as such following a Change of Control and is not made the Chief Financial Officer of the acquiring corporation) shall not constitute “Good Reason;” (ii) a material reduction by the Company in Executive’s annual Base Salary as in effect immediately prior to such reduction; (iii) a material reduction by the Company in the kind or level of Executive benefits to which Executive is entitled immediately prior to such reduction with the result that Executive’s overall benefits package is significantly reduced; (iv) the relocation of Executive’s primary place of work to a facility or

a location that increases Executive’s commute distance by more than 35 miles from Executive’s then primary place of work ; or (v) the material breach of this Agreement by the Company (including, but not limited to, failure of the Company to obtain the assumption of this Agreement by any successors contemplated in Section 12).
10.Confidential Information. Executive agrees to enter into the Company’s standard Confidential Information and Invention Assignment Agreement (the “Confidential Information Agreement”) upon commencing employment hereunder.
11.Conditional Nature of Severance Payments.
(a)Noncompete. Executive acknowledges that the nature of the Company’s business is such that if Executive were to become employed by, or substantially involved in, the business of a competitor of the Company following the termination of Executive’s employment with the Company, it would be very difficult for Executive not to rely on or use the Company’s trade secrets and confidential information. Thus, to avoid the inevitable disclosure of the Company’s trade secrets and confidential information, Executive agrees and acknowledges that Executive’s right to receive the severance payments set forth in Section 7 (to the extent Executive is otherwise entitled to such payments) shall be conditioned upon Executive not directly or indirectly engaging in (whether as an employee, consultant, agent, proprietor, principal, partner, stockholder, corporate officer, director or otherwise), nor having any ownership interest in or participating in the financing, operation, management or control of, any person, firm, corporation or business that competes with Company or is a customer of the Company. Upon any breach of this section, all severance payments pursuant to this Agreement shall immediately cease.
(b)Non-Solicitation. Until the date eighteen (18) months after the termination of Executive’s employment with the Company for any reason, Executive agrees not, either directly or indirectly, to solicit, induce, attempt to hire, recruit, encourage, take away, hire any employee of the Company or cause an employee to leave his or her employment either for Executive or for any other entity or person. Additionally, Executive acknowledges that Executive’s right to receive the severance payments set forth in Section 7 (to the extent Executive is otherwise entitled to such payments) are contingent upon Executive complying with this Section 10(b) and upon any breach of this section all severance payments pursuant to this Agreement shall immediately cease.
(c)Understanding of Covenants. Executive represents that Executive (i) is familiar with the foregoing covenants not to compete and not to solicit, and (ii) is fully aware of Executive obligations hereunder, including, without limitation, the reasonableness of the length of time, scope and geographic coverage of these covenants.
12.Code Section 409A. For purposes of this Agreement, a termination of employment will be determined consistent with the rules relating to a “separation from service” as defined in Section 409A of the Code and the regulations thereunder (“Section 409A”). Notwithstanding anything else provided herein, to the extent any payments provided under this Agreement in connection with Executive’s termination of employment constitute deferred compensation subject to Section 409A, and Executive is deemed at the time of such termination of employment to be a “specified employee” under Section 409A, then such payment shall not be made or commence until the earlier of (i) the expiration of the 6-month period measured from Executive’s separation from service from the Company or (ii) the date of Executive’s death following such a separation from service; provided, however, that such deferral shall only be effected to the extent required to avoid adverse tax treatment to Executive including, without limitation, the additional tax for which Executive would otherwise be liable under Section 409A(a)(1)(B) in the absence of such a deferral. The first payment thereof will include a catch-up payment covering the amount that would have otherwise been paid during the period between Executive’s termination of employment and the first payment date but for the application of this provision, and the balance of the installments (if any) will be payable in accordance with their original schedule. To the extent that any provision of this Agreement is ambiguous as to its compliance with Section 409A, the provision will be read in such a manner so that all payments hereunder comply with Section 409A. To the extent any payment under this Agreement may be classified as a “short-term deferral” within the meaning of Section 409A, such payment shall be deemed a short-term deferral, even if it may also qualify for an exemption from Section 409A under another provision of Section 409A. Payments pursuant to this section are intended to constitute separate payments for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations. Except as otherwise expressly provided herein, to the extent any expense reimbursement or the provision of any in-kind benefit under this Agreement is determined to be subject to Section 409A of the Code, the amount of any such expenses eligible for reimbursement, or the provision of any in-kind benefit, in one calendar year shall not affect the expenses eligible for reimbursement in any other taxable year (except for any lifetime or other aggregate limitation applicable to medical expenses), in no event shall any expenses be reimbursed after the last day of the calendar year following the calendar year in which the Executive incurred such expenses, and in no event shall any right to reimbursement or the provision of any in-kind benefit be subject to liquidation or exchange for another benefit.

13.Assignment. This Agreement will be binding upon and inure to the benefit of (a) the heirs, executors and legal representatives of Executive upon Executive’s death and (b) any successor of the Company. Any such successor of the Company will be deemed substituted for the Company under the terms of this Agreement for all purposes. For this purpose, “successor” means any person, firm, corporation or other business entity which at any time, whether by purchase, merger or otherwise, directly or indirectly acquires all or substantially all of the assets or business of the Company. None of the rights of Executive to receive any form of compensation payable pursuant to this Agreement may be assigned or transferred except by will or the laws of descent and distribution. Any other attempted assignment, transfer, conveyance or other disposition of Employee’s right to compensation or other benefits will be null and void.
14.Notices. All notices, requests, demands and other communications called for hereunder shall be in writing and shall be deemed given (i) on the date of delivery if delivered personally, (ii) one (1) day after being sent by a well- established commercial overnight service, or (iii) four (4) days after being mailed by registered or certified mail, return receipt requested, prepaid and addressed to the parties or their successors at the following addresses, or at such other addresses as the parties may later designate in writing:
If to the Company:

Natus Medical Incorporated 1501 Industrial Road
San Carlos, CA 94070
Attn: James Hawkins, Chief Executive Officer If to Executive:
at the last residential address known by the Company.
15.Severabilitv. In the event that any provision hereof becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, this Agreement will continue in full force and effect without said provision.
16.Arbitration.
(a)General. In consideration of Executive’s service to the Company, its promise to arbitrate all employment related disputes and Executive’s receipt of the compensation, pay raises and other benefits paid to Executive by the Company, at present and in the future, Executive agrees that any and all controversies, claims, or disputes with anyone (including the Company and any employee, officer, director, shareholder or benefit plan of the Company in their capacity as such or otherwise) arising out of, relating to, or resulting from Executive’s service to the Company under this Agreement or otherwise or the termination of Executive’s service with the Company, including any breach of this Agreement, shall be subject to binding arbitration under the Arbitration Rules set forth in California Code of Civil Procedure Section 1280 through 1294.2, including Section 1283.05 (the “Rules”) and pursuant to California law. Disputes which Executive agrees to arbitrate, and thereby agrees to waive any right to a trial by jury, include any statutory claims under state or federal law, including, but not limited to, claims under Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act of 1990, the Age Discrimination in Employment Act of 1967, the Older Workers Benefit Protection Act, the California Fair Employment and Housing Act, the California Labor Code, claims of harassment, discrimination or wrongful termination and any statutory claims. Executive further understands that this Agreement to arbitrate also applies to any disputes that the Company may have with Executive.
(b)Procedure. Executive agrees that any arbitration will be administered by the American Arbitration Association (“AAA”) and that a neutral arbitrator will be selected in a manner consistent with its National Rules for the Resolution of Employment Disputes. The arbitration proceedings will allow for discovery according to the rules set forth in the National Rules for the Resolution of Employment Disputes or California Code of Civil Procedure. Executive agrees that the arbitrator shall have the power to decide any motions brought by any party to the arbitration, including motions for summary judgment and/or adjudication and motions to dismiss and demurrers, prior to any arbitration hearing. Executive agrees that the arbitrator shall issue a written decision on the merits. Executive also agrees that the arbitrator shall have the power to award any remedies, including attorneys’ fees and costs, available under applicable law. Executive understands the Company will pay for any administrative or hearing fees charged by the arbitrator or AAA except that Executive shall pay the first $200.00 of any filing fees associated with any arbitration Executive initiates. Executive agrees that the arbitrator shall administer and conduct any arbitration in a manner consistent with the Rules and that to the extent that the AAA’s National Rules for the Resolution of Employment Disputes conflict with the Rules, the Rules shall take precedence.

(c)Remedy. Except as provided by the Rules, arbitration shall be the sole, exclusive and final remedy for any dispute between Executive and the Company. Accordingly, except as provided for by the Rules, neither Executive nor the Company will be permitted to pursue court action regarding claims that are subject to arbitration. Notwithstanding, the arbitrator will not have the authority to disregard or refuse to enforce any lawful Company policy, and the arbitrator shall not order or require the Company to adopt a policy not otherwise required by law that the Company has not adopted.
(d)Availability of Injunctive Relief. In addition to the right under the Rules to petition the court for provisional relief, Executive agrees that any party may also petition the court for injunctive relief where either party alleges or claims a violation of this Agreement or the Confidentiality Agreement or any other agreement regarding trade secrets, confidential information, nonsolicitation or Labor Code §2870. In the event either party seeks injunctive relief, the prevailing party shall be entitled to recover reasonable costs and attorneys’ fees.
(e)Administrative Relief. Executive understands that this Agreement does not prohibit Executive from pursuing an administrative claim with a local, state or federal administrative body such as the Department of Fair Employment and Housing, the Equal Employment Opportunity Commission or the workers’ compensation board. This Agreement does, however, preclude Executive from pursuing court action regarding any such claim.
(f)Voluntary Nature of Agreement. Executive acknowledges and agrees that Executive is executing this Agreement voluntarily and without any duress or undue influence by the Company or anyone else. Executive further acknowledges and agrees that Executive has carefully read this Agreement and that Executive has asked any questions needed for Executive to understand the terms, consequences and binding effect of this Agreement and fully understand it, including that Executive is waiving Executive’s right to a jury trial. Finally, Executive agrees that Executive has been provided an opportunity to seek the advice of an attorney of Executive’s choice before signing this Agreement.
17.Integration. This Agreement, together with the any Company stock awards plan pursuant to which stock options, restricted stock, restricted stock units or other equity awards have been made to Executive, any agreements representing any such equity awards, and the Confidential Information Agreement represents the entire agreement and understanding between the parties as to the subject matter herein and supersedes all prior or contemporaneous agreements whether written or oral. No waiver, alteration, or modification of any of the provisions of this Agreement will be binding unless it is in writing and specifically mentions this Section 16 and it is signed by duly authorized representatives of the parties hereto.
18.Waiver of Breach. The waiver of a breach of any term or provision of this Agreement, which must be in writing, shall not operate as or be construed to be a waiver of any other previous or subsequent breach of this Agreement.
19.Headings. All captions and section headings used in this Agreement are for convenient reference only and do not form a part of this Agreement.
20.Tax Withholding. All payments made pursuant to this Agreement will be subject to withholding of applicable taxes.
21.Governing Law. This Agreement will be governed by the laws of the State of California (with the exception of its conflict of laws provisions).
22.Acknowledgment Executive acknowledges that he has had the opportunity to discuss this matter with and obtain advice from his private attorney, has had sufficient time to, and has carefully read and fully understands all the provisions of this Agreement, and is knowingly and voluntarily entering into this Agreement.
23.Counterparts. This Agreement may be executed in counterparts, and each counterpart shall have the same force and effect as an original and shall constitute an effective, binding agreement on the part of each of the undersigned.

[Signature Page to Follow]

IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of the Company by their duly authorized officers, as of the day and year first above written.

COMPANY:
NATUS MEDICAL INCORPORATED

By:    Date:

Title:

Executive:    Date:

[Signature Page to Employment Agreement]EX-10.1

 Exhibit 10.1 

SEPARATION AGREEMENT AND RELEASE 

This Separation Agreement and Release (“Agreement”) is entered into by and between John A. Manzi (“Executive”) and NN, Inc.
(the “Company”) on this 2nd day of January 2018 (the “Execution Date”). 
 WHEREAS, Executive has been the
Company’s Senior Vice President and General Manager for the Precision Engineered Products (“PEP”) Group since October 2015; 

WHEREAS, Executive has provided valuable service to the Company, in particular in the integration of the PEP Group; 

WHEREAS, Executive has determined to voluntarily resign from the Company; and, 

WHEREAS, the Company has agreed to make certain payments to Executive in consideration of the covenants of Executive contained herein.

 NOW, THEREFORE, the parties, in consideration of the above and the agreements and covenants herein, agree as follows: 

 

	1.	Executive and the Company agree that Executive’s duties will cease as of January 2, 2018 and that Executive hereby voluntarily resigns and his employment with the Company will end on January 19, 2018
(“Separation Date”). Executive understands and acknowledges that following the Separation Date he will neither receive nor accrue any seniority based benefits including, but not limited to, vacation or other paid time off. Continuation of
benefits, including any conversion from a Company sponsored life insurance policy to an individual life insurance policy, shall be subject to the terms and conditions of those benefit policies and solely at Executive’s expense.

  

	2.	In exchange for and in consideration of all of the promises and covenants contained in this Agreement, including but not limited to the release of claims by Executive detailed in this Agreement, the Company agrees to
provide Executive with the following: 

  

	 	(a)	a sum equal to the gross amount of Five Hundred Twelve Thousand One Hundred Dollars ($512,100) paid in equal installments on each regular Company biweekly payday commencing on the regular payday occurring immediately
following the expiration of the revocation period referred to in Section 16 hereof and ending on the regular payday immediately preceding or coinciding with March 15, 2019; 

 

	 	(b)	an additional amount of Twelve Thousand Dollars ($12,000) to assist with transition from employment, paid in a lump sum on the first regular Company payday following the date any payments under this Agreement commence;

  

	 	(c)	participation in the 2017 Executive Incentive Compensation program at Executive’s current pay and participation level, which is fifty percent (50%) of current base pay (provided any incentive compensation amounts
paid will be based on actual performance versus plan, are determined in accordance with the Company’s corporate guidelines, will be distributed after completion of the Company’s fiscal year-end audit
and final determination by the Company’s Compensation Committee); 

  
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	 	(d)	the ownership rights to the Company’s mobile phone, mobile phone number, and iPad currently assigned to Executive, but with no obligation by the Company to continue any wi-fi
service, cellular service or technology support for said devices; 

  

	 	(e)	Prompt reimbursement for any and all reimbursable business expenses (to the extent not already reimbursed) upon Executive’s properly accounting for same; and, 

 

	 	(f)	accelerated vesting of the currently unvested NN, Inc. restricted shares awarded to Executive in 2016 and 2017; provided vesting will be effective on the eighth (8th)
day after you timely sign and return this Agreement, provided there is no timely revocation of this Agreement as explained in Section 16 below. 

The payments and benefits set forth above are hereinafter referred to collectively as “the Separation Benefits.” None of the
Separation Benefits will be due until the Company timely receives a copy of this Agreement signed by Executive and the seven-day revocation period referenced in Section 16 of this Agreement has passed
without receipt of a valid timely revocation by Executive. After the revocation period, the Separation Benefits will be provided in the time periods and manner set forth above. Should Executive not timely sign and return this Agreement by the
deadline stated in Section 16 below or should Executive timely sign this Agreement, but then timely exercises his right to revoke it, none of the Separation Benefits will be due to Executive and Executive will be responsible for immediately
returning the Company’s mobile phone and iPad in good working condition. 
 The Company’s obligations to make any payments
pursuant to this Section 2 are expressly conditioned on Executive timely signing and returning this Agreement and Executive’s continued compliance with all of the provisions of this Agreement. Should Executive fail to comply with all
provisions of this Agreement, the Company reserves the right to stop any further payments and to pursue legal action to collect all payments made as well as other damages to which it may be entitled by law. 

The Company will withhold from any amounts payable under this Agreement any U.S. federal, state and local taxes as may be required to be
withheld pursuant to any applicable law or regulation. 

  
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	3.	In exchange for the Separation Benefits, Executive releases the Company and its affiliates, predecessors, successors, subsidiaries, divisions, assigns, officers, directors, shareholders, physicians, employees, former
employees, attorneys, insurers, agents, and corporate affiliates (collectively referred to as “Releasees”), from any and all claims, whether known or unknown, causes of action, liabilities, costs (including attorney’s fees),
obligations, and judgments of any kind in Executive’s favor (whether known or unknown) which arise out of Executive’s employment with, or the separation of employment with the Company (the “Released Claims”) up through and
including the Separation Date. The Released Claims shall include, but are not limited to, claims for breach of contract, wrongful termination, or past wages as permitted under applicable state law; claims under or based upon Title VII of the Civil
Rights Act of 1964 as amended, Title VII of the Civil Rights Act of 1991 or any state counterpart, the Sarbanes-Oxley Act of 2002, the Americans With Disabilities Act as amended or any state counterparts, the Age Discrimination in Employment Act the
Genetic Information Nondiscrimination Act and the Rehabilitation Act of 1973 or any state counterparts, or any other claims or causes of action emanating from common law; claims under or based upon the Employee Retirement Income Security Act of
1974, as amended (“ERISA“) (except for any claim for vested benefits under the terms of any ERISA covered employee benefit plan); the Massachusetts Minimum Fair Wage Law (Mass. Gen. Laws Ann. ch. 151); the Massachusetts Equal Pay Act
(Mass. Gen. Laws Ann. ch. 105A); the State Labor Relations Law (Mass. Gen. Laws Ann. ch. 150A); the Unemployment Insurance Law (Mass. Gen. Laws Ann. ch. 151A); the Massachusetts Anti-discrimination Statute (Mass. Gen. Laws Ann. ch. 151B);
Massachusetts workers’ compensation laws (Mass. Gen. Laws Ann. ch. 152); the Massachusetts Civil Rights Act (Mass. Gen. Laws Ann. ch. 93, § 103 et seq.); Massachusetts child labor laws (Mass. Gen. Laws Ann. ch. 149 ,§§ 69, 76,
86, 90-95a); the Massachusetts Whistleblower Act (Mass. Gen. Laws Ann. ch. 149, § 185); miscellaneous laws regulating labor relations, to the extent not duplicative with the foregoing (Mass. Gen. Laws
Ann. ch. 149); the Massachusetts Antitrust Act (Mass. Gen. Laws Ann. ch. 93, §§ 1-14); Massachusetts regulations of business practices for consumers’ protection (Mass. Gen. Laws Ann. ch. 93A),
the Rhode Island Fair Employment Practices Act; (R.I. Gen. Laws §§28-5-1 to
28-5-42) Rhode Island AIDS Law (R.I. Gen. Laws §23-6.3-11); Rhode Island Civil
Rights of People with Disabilities Law (R.I. Gen. Laws §§42-87-1 to 42-87-5);
Rhode Island Domestic Abuse Bias in Employment Law (R.I. Gen. Laws §12-28-10); Rhode Island Discrimination Based on Genetic Testing Law (R.I. Gen. Laws §§28-6/7-1 to 28-6.7-5); Rhode Island Military Family Relief Act (R.I. Gen. Laws §§30-33-1 to 30-33-6); Rhode Island Equal Pay Act (R.I. Gen. Laws §§38-6-17 to 28-6-21); Rhode Island Whistleblower Protection Act (R.I. Gen. Laws §§28-50-1 to 28-50-9); any similar city, county, or local laws or ordinances, and the
common law of the State of Massachusetts and/or Rhode Island. In return for the consideration set forth in Paragraph 2 of this Agreement, Executive further specifically waives and releases any and all claims Executive may have arising out of the
Executive Employment Agreement executed between Executive and the Company dated October 19, 2015 (the “Executive Employment Agreement”), a copy of which is attached hereto for reference. 

As part of this release, Executive covenants not to sue the Releasees in any court or to request arbitration against the Releasees on any of
the Released Claims. The Released Claims do not include claims that are not waivable by law. For example, nothing in this Agreement limits Executive’s ability to participate in any investigation by, or to file a complaint with, any federal or
state administrative agency; Executive’s ability to file for unemployment compensation benefits or workers compensation benefits, or Executive’s ability to file a legal proceeding to pursue claims related to the enforcement or
interpretation of this Agreement. With respect to claims brought on Executive’s behalf by a federal or state administrative agency, however, Executive agrees to waive his right (if any) to a monetary recovery. Notwithstanding anything to the
contrary herein contained, the Released Claims do not include (i) any vested rights Executive has to employee benefits such as benefits under the Company’s 401(k) plan or any stock option agreement; (ii) any rights Executive has under
that certain Stock Purchase Agreement dated as of August 17, 2015 (the “Stock Purchase Agreement”) among the Company, Precision Engineered Products Holdings, Inc., and PEP Industries LLC, including but not limited to the rights under
Section 7.6 thereof; (iii) any claims, rights, or obligations under this Agreement and (iv) any rights to indemnification Executive has under the Company’s certificate of incorporation or
by-laws, as now in effect. 

  
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	4.	Executive acknowledges and agrees that he has not assigned to anyone any of the Released Claims. 

  

	5.	Executive acknowledges and agrees that: (a) Executive received all pay to which he was entitled during employment with the Company; (b) Executive does not believe that he is owed unpaid wages, bonus or
incentive compensation payments, or unpaid overtime compensation by the Company; and (c) Executive does not believe that his rights under any state or federal wage and hour laws, including the federal Fair Labor Standards Act
(“FLSA”), have been violated during his employment with the Company. Executive also acknowledges and agrees that: (a) Executive has received all paid and unpaid leave, including benefits under the federal Family and Medical Leave Act
(“FMLA”), to which he was entitled during his employment with the Company; (b) Executive has no pending request for FMLA leave; and (c) Executive does not believe that his rights under the FMLA have been interfered with or that
he has been discriminated against or otherwise mistreated based on any request for leave or based on any illness, condition, or injury to himself or a family member during employment with the Company. 

 

	6.	Executive agrees that prior to the Separation Date he will deliver to the Company all documents, records, or other property of any nature belonging to the Company in his custody or control, except that property
specified in Subsection 2(d) above. 

  

	7.	Through February 28, 2018, Executive agrees to provide reasonable assistance to the Company when requested and upon reasonable notice to transition his job functions and responsibilities and, in connection
therewith, to execute and deliver any documents, certificates, agreements, or instruments which are reasonably necessary to affect such transition. 

  

	8.	Executive agrees to cooperate with the Company and its attorneys in connection with any and all legal matters, lawsuits, investigation or audits involving matters that occurred during Executive’s employment with
the Company. Such cooperation may include, but is not limited to, meeting with the Company’s attorneys upon reasonable notice and/or providing truthful and accurate information, testimony and documents. Such cooperation shall be given at
mutually agreed times and upon reasonable advance notice, and Executive shall be promptly reimbursed for all documented out-of-pocket costs and expenses incurred by him
in providing such cooperation. Executive shall notify the Company promptly if Executive receives a subpoena or is otherwise required by legal process to provide testimony, documents or information regarding the Company’s business operations or
Executive’s actions as an employee of the Company. Executive acknowledges and agrees that during his tenure with the Company he was privy to communications protected by the attorney client and/or attorney work product privileges and that he is
not authorized to waive such privileges or disclose such information. 

  
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	9.	Executive agrees that he will never seek reemployment or any contractual relationship with the Company or any of its divisions or affiliates. 

 

	10.	Executive acknowledges and agrees the Company has developed confidential information, strategies and programs, which include customer lists, prospect lists, expansion and acquisition plans, market research, sales
systems, marketing programs, computers systems and programs, product development strategies, manufacturing strategies and techniques, budgets, pricing strategies, identity and requirements of national accounts, methods of operating, service systems,
training programs and methods, other Trade Secrets and information about the business in which the Company is engaged that is not known to the public and gives the Company an opportunity to obtain advantage over competitors who do not know of such
information (collectively “Confidential Information”). The term “Confidential Information shall not include (i) any such information that, prior to its use or disclosure by Executive, can be shown to have been in the public
domain or generally known or available to customers, suppliers, or competitors of the Company through no breach of the provisions of this Agreement or other non-disclosure covenants; and (ii) any such
information that, prior to its disclosure by Executive, was rightfully in the receiving third party’s possession, without violation of the provisions of this Agreement or other non-disclosure covenants;
and (iii) any such information that, prior to its disclosure by Executive, was independently developed by the receiving third party without violation of the provisions of this Agreement or other
non-disclosure covenants. In performing duties for the Company, Executive regularly has been exposed to and worked with Confidential Information of the Company. Executive may also have been exposed to and
worked with Confidential Information of the Company’s affiliates and subsidiaries. Executive acknowledges and agrees that Confidential Information and Trade Secrets of the Company and its affiliates and subsidiaries is critical to the
Company’s success and that the Company and its affiliates and subsidiaries have invested substantial sums of money in developing the Confidential Information and Trade Secrets. Executive agrees that following the Separation Date he will not
reproduce, publish, disclose, use, reveal, show, or otherwise communicate to any person or entity any Confidential Information or Trade Secrets of the Company, its affiliates and/or subsidiaries unless specifically directed in writing by the Company
to do so or unless required by law or pursuant to valid legal process. Executive further agrees that prior to the Separation Date he will return all documents, electronic or otherwise, containing or referring to Confidential Information and Trade
Secrets that may be in Executive’s possession, custody, or control. Executive is hereby notified in accordance with the Defend Trade Secrets Act of 2016 that Executive will not be held criminally or civilly liable under any federal or state
trade secret law for the disclosure of a trade secret that: (a) is made (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (ii) 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. Executive is further notified that if Executive files a lawsuit for retaliation
by an employer for reporting a suspected violation of law, Executive may disclose the employers’ trade secrets to Executive’s attorney and use the trade secret information in the court proceeding if Executive: (a) files any document
containing the trade secret under seal; and (b) does not disclose the trade secret, except pursuant to court order. Executive agrees that this Agreement will be considered Confidential Information and that Executive will not disclose its
existence or its terms unless he does so to his attorney, a financial advisor, his spouse, or in the pursuit of legal action that does not relate to a Released Claim and is otherwise permitted under the terms of this Agreement. Executive
acknowledges and agrees that should he choose to disclose this Agreement to his attorney, financial advisor, and/or spouse, that those persons will become his agents and will be equally bound by the confidentiality provisions of this Agreement. Any
breach of Executive’s confidentiality obligations by Executive or by his agent as defined herein will result in the Company ceasing any further payments that may be due herein and the Company reserves all rights to institute legal proceedings
for repayment of all amounts previously paid to Executive as well as all other damages available by law. 

  
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	11.	Executive agrees that during his tenure of employment with the Company and for a period of eighteen (18) months following the Separation Date (the “Restricted Period”), he will not, acting directly or
indirectly, or through any other person, firm, entity, or corporation, hire, contract with or employ any then employee of the Company, and/or any then employee of any affiliate or subsidiary of the Company with which Executive interacted or about
which Executive gained Confidential information during his employment with the Company (“Restricted Employees”). Further, Executive will not induce or attempt to induce or influence or attempt to influence any of the Restricted Employees
to terminate employment with the Company, affiliate or subsidiary. This provision, however, shall not apply to Executive in the case of the solicitation of his immediate family members, if any. 

 

	12.	Executive agrees that during his tenure of employment with the Company and for the Restricted Period, Executive will not, directly or indirectly, or through any other person, firm or corporation (i) be employed by,
consult for, have any ownership interest in or engage in any activity on behalf of any company that engages in a Competing Business, as defined below, or (ii) call on, solicit or communicate with any of the Company’s customers or suppliers
for any purpose related to a Competing Business, as defined below. A “Competing Business” is one that engages in the production, sale, or marketing of a product or service that is substantially similar to, or serves the same purpose as,
any product or service produced, sold or marketed by the Company or any parent, subsidiary or affiliate of the Company with which Executive interacted or about which Executive gained Confidential Information and/or Trade Secrets during his
employment with the Company. The term “customer” or “supplier” means any customer or supplier (whether actual or potential) with whom Executive or any other employee of the Company or any parent, subsidiary or affiliate of the
Company had business contact during the eighteen (18) months immediately before the Separation Date. Notwithstanding the foregoing, this section shall not be construed to prohibit Executive from owning less than five percent (5%) of the
outstanding securities of a corporation which is publicly traded on a securities exchange or over-the-counter. 

  
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	13.	Executive grants the Company the right to notify any future or prospective employer of Executive or any other entity or person of the existence of the terms of this Agreement including, but not limited to, the
restrictive covenants set forth herein and grants the Company the right to provide a copy of this Agreement in connection with said notification. 

  

	14.	Executive agrees that all right, title and interest of every kind and nature whatsoever in and to copyrights, patents, ideas, business or strategic plans and concepts, studies, presentations, creations, inventions,
writings, properties, discoveries and all other intellectual property conceived by Executive during employment with the Company and pertaining to or useful in or to (directly or indirectly) the activities of the Company and/or any parent, subsidiary
or affiliate of the Company (collectively “Company Intellectual Property”) shall remain the exclusive property of the Company. 

  

	15.	Executive is advised and encouraged to consult with an attorney of his choice before signing this Agreement. 

  

	16.	Executive understands that he has twenty-one (21) calendar days to consider the terms of this Agreement, sign it, and return it to the Company’s representative, Gail
Nixon, Vice President — Human Resources of NN, Inc. Executive further understands that he has seven (7) calendar days following his execution of this Agreement to revoke this Agreement. If Executive wishes to revoke this Agreement,
Executive must notify the Company’s representative, Gail Nixon, Vice President – Human Resources of NN, Inc., in writing and deliver that notification to her within seven (7) days following his execution of this Agreement. Any mailed
notice of revocation must be postmarked prior to the conclusion of the seventh day after the signing of the agreement. 

  

	17.	By signing this Agreement, Executive represents and warrants that he: 

  

	 	(a)	Has carefully read this Agreement and understands its terms: 

  

	 	(b)	Has been advised to consult with an attorney of his choice before signing this Agreement; 

  

	 	(c)	Agrees that the consideration offered in exchange for his agreement to the terms herein consists of payments and benefits of value that Executive is not otherwise entitled to receive by virtue of his employment or his
separation of employment with the Company; 

  

	 	(d)	Has had an adequate opportunity of twenty-one (21) days to consider the terms of this Agreement; 

 

	 	(e)	Understands he has an additional seven (7) days after signing this Agreement to change his mind and revoke it; 

  
 Page 7 

	 	(f)	Understands that this Agreement will not become effective after he signs it until the seven (7) day revocation period has run without the Company receiving a valid, timely revocation; 

 

	 	(g)	Voluntarily assents to all the terms and conditions contained herein; 

  

	 	(h)	Has signed this Agreement voluntarily and of his own free will; and 

  

	 	(i)	Is not suffering from any disability or condition that would render Executive unable to legally enter into this Agreement. 

  

	18.	Executive agrees that he will not make any statements, written or verbal, that are derogatory or disparaging concerning the Company, or concerning any current or former directors, officers, or employees of the Company.
The Company similarly agrees that it will not make any statements, written or verbal, that are derogatory or disparaging concerning Executive or his employment with the Company. The Company further agrees that it will provide a positive reference
about Executive to any prospective future employer. 

  

	19.	Pursuant to Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and Treas. Reg. §1.409A-1(n) promulgated thereunder, the Parties agree
that as of the Separation Date, Executive’s termination of employment is within the meaning set forth in Treas. Reg. §1.409A-1(n) and all payments under this Agreement are intended to satisfy the
“short-term deferral” exemption under Treas. Reg. §1.409- 1(b)(4) and/or the “separation pay” exemption under Treas. Reg. §1.409-1(b)(9)
such that no payment hereunder shall be deemed “deferred compensation” within the meaning of Code Section 409A. Executive will be paid his regular base salary (subject to any applicable withholding and deductions) through the
Separation Date. Executive’s final, prorated salary will be paid on the next normal Company payday following the Separation Date. Executive understands and agrees that he will not receive, nor be entitled to, any additional salary or other pay
subsequent to the Separation Date, except as set forth specifically in the Agreement terms described herein. 

  

	20.	The parties agree that the Executive Employment Agreement between Executive and the Company, dated October 19, 2015 (the “Employment Agreement”), will be terminated as of January 19, 2018 by virtue
of Executive’s voluntary resignation of employment regardless of whether Employee chooses to timely sign and return this Agreement. In the event that Executive chooses to timely sign and return this Agreement and does not exercise his right to
revoke it, then the terms of this Agreement will supersede and replace the Employment Agreement in its entirety including those provisions in the Employment Agreement that survive termination according to the terms of the Employment Agreement. This
Agreement will, therefore, constitute the entire agreement existing between Executive and the Company. Should Executive, however, not timely sign and return this Agreement or Executive timely signs and returns this Agreement but timely exercise his
right to revoke it, then the Employment Agreement will still terminate as of January 19, 2018 but the provisions in the Employment Agreement that survive termination will continue in full force and effect including, but not limited to,
provisions contained in Paragraphs 7, 8, 9, 10 and 11 of the Employment Agreement. 

  
 Page 8 

	21.	This Agreement does not constitute an admission of liability or wrongdoing by either party. 

  

	22.	Whenever the word “Executive” is used in this Agreement, it shall be deemed to include John A. Manzi, his heirs, administrators, and/or the legal representative of his estate. Whenever the words “the
parties” are used in this Agreement, they shall be deemed to include “Executive” and “Company,” as defined herein. 

  

	23.	This Agreement shall inure to the benefit of, and shall be enforceable by, the Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributes, devisees and legatees. If the
Executive should die while any amount would still be payable to him hereunder if he had continued to live, all such amounts, except to the extent otherwise provided under this Agreement, shall be paid in accordance with the terms under this
Agreement to his devisee, legatee or other designee, or if there be no designee, to the Executive’s estate. 

  

	24.	In the event that any provision of this Agreement is held to be unenforceable for any reason by a court of competent jurisdiction, the validity of the remaining provisions of this Agreement shall not be affected
thereby, and the invalid or unenforceable provision shall be deemed not to be a part of this Agreement. This Agreement shall not be construed strictly for or against Executive or the Company. 

 

	25.	This Agreement and any disputes relating to this Agreement shall be governed and construed in accordance with the laws of the State of Tennessee. 

 

	26.	The Company’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be subject to set off for any reason and shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against Executive or others. In no event shall Executive be obligated to seek other employment or take any other
action by way of mitigation of the amounts payable to Executive under any of the provisions of this agreement and such amounts shall not be reduced whether or not Executive obtains other employment. 

IN WITNESS WHEREOF, the parties have signed and delivered this Agreement as of the date written above. 

NN, Inc. 
 /s/ Richard D.
Holder 
 Richard D. Holder 

President and CEO 

  
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 Executive Acknowledgement: 

I agree that I have been advised to consult with an attorney of my choice before signing this Agreement, and acknowledge that I have had an opportunity to ask
any questions regarding this agreement before signing it. By my signature below, I acknowledge that I understand and hereby accept the terms of the Agreement set forth above. 

  /s/ John A. Manzi     

John A. Manzi 
 1-3-18                 

Date Signed 

  
 Page 10

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