Edgar Filing: National CineMedia, Inc.

Fiscal 2016-2018 Performance Measures (in millions) (1)

Achievement relative to target

2016 PBRS cumulative Free Cash Flow

80.6% of targeted Free Cash Flow

Document

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934

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☐	Soliciting Material Pursuant to §240.14a-12

NATIONAL CINEMEDIA, INC.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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Notice of Annual Meeting of Stockholders to be held on May 2, 2019

You are cordially invited to attend the Annual Meeting of Stockholders (“Annual Meeting”) of National CineMedia, Inc., which will be held at our offices located at 6300 South Syracuse Way, Suite 300, Centennial, Colorado 80111 on Thursday, May 2, 2019 at 9:00 a.m., Mountain Time. At the Annual Meeting, you will be asked to consider the following:



1	To elect the eight nominees named in the accompanying proxy statement, each to serve a one-year term and until their respective successors are duly elected or qualified;



2	To approve, on an advisory basis, our executive compensation;



3	To ratify the appointment of Deloitte & Touche LLP as our independent auditors for the fiscal year ending December 26, 2019; and



4	To transact such other business as may properly come before the meeting and at any adjournments or postponements of the meeting.

The close of business on March 4, 2019 has been set as the record date for the determination of stockholders entitled to notice of and to vote at the Annual Meeting and any and all adjournments or postponements thereof.

We are electronically disseminating our Annual Meeting materials by using the "Notice and Access" method approved by the Securities and Exchange Commission. We believe this process should continue to provide a convenient way to access your proxy materials and vote. The Notice of Internet Availability of Proxy Materials contains specific instructions on how to access Annual Meeting materials via the internet as well as instructions on how to receive paper copies if preferred. The proxy statement and Annual Report for the fiscal year ended December 27, 2018 are available at www.edocumentview.com/ncmi.

Whether or not you are able to attend the Annual Meeting, it is important that your shares be represented regardless of the size of your holdings. Please vote your proxy promptly in accordance with the instructions you receive in the enclosed proxy statement and proxy card, as a quorum of the stockholders must be present, either in person or by proxy, in order for the Annual Meeting to take place.

Please note that brokers may not vote your shares on the election of directors or any other non-routine matters if you have not given your broker specific instructions as to how to vote. Please be sure to give specific voting instructions to your broker so that your vote can be counted.




Centennial, Colorado				Sarah Kinnick Hilty
March 14, 2019				Senior Vice President, General Counsel and Secretary

TABLE OF CONTENTS




Proxy Summary	1
Questions and Answers	3
Proposal No. 1: Election of Directors	7
Board Composition	7
Business Experience of the Nominees	8
Vote Required	10
Recommendation	10
Independence of our Board of Directors	10
Company Leadership Structure	10
Board’s Role in Risk Oversight	11
Compensation Risk Assessment	11
Meetings of our Board of Directors and Standing Committees	11
Stockholder Communications	14
Compensation Discussion and Analysis	15
Introduction	15
Executive Summary	15
Detailed Discussion & Analysis	17
Stockholder Say-on-Pay Vote	22
Adjusted OIBDA for Compensation Purposes, Adjusted Advertising Revenue, and Free Cash Flow	23
Other Policies	24
Compensation Committee Report	25
Executive Compensation Tables	26
Fiscal 2018 Summary Compensation Table	26
Fiscal 2018 Grants of Plan-Based Awards	28
Outstanding Equity Awards at December 27, 2018	29
Stock Vested During Fiscal 2018	30
Potential Payments Upon Termination or Change in Control	31
Employment Agreements	32
Non-Employee Director Compensation	35
Fiscal 2018 Non-Employee Director Compensation	36
CEO Pay Ratio	38
Equity Compensation Plan Information	38
Proposal No. 2: Advisory Approval of the Company’s Executive Compensation	40
Vote Required	40
Recommendation	40
Proposal No. 3: Ratification of Independent Auditors	41
Fees Paid to Independent Auditors	41
Pre-Approval Policies and Procedures	41
Vote Required	41
Recommendation	41
Audit Committee Report	42
Voting Securities and Principal Holders	43
Beneficial Ownership	43
Share Ownership, Anti-Hedging, Anti-Pledging and Clawback Policies	44
Certain Relationships and Related Party Transactions	44
General	44
Transactions with Founding Members	45



Other Transactions	49
Letter Agreement	49
Transactions with NCM LLC	50
Review, Approval or Ratification of Transactions with Related Persons	50
Code of Business Conduct and Ethics	50
Section 16(a) Beneficial Ownership Reporting Compliance	51
Proposals of Stockholders	51
Other Business	51



PROXY SUMMARY
This summary highlights information discussed in more detail elsewhere in this Proxy Statement. As this is only a summary, we encourage stockholders to read the entire Proxy Statement and our 2018 Annual Report before voting their shares. The accompanying proxy is solicited by the board of directors (“Board of Directors” or “Board”) of National CineMedia, Inc., a Delaware corporation (“NCM, Inc.” or the “Company”), for use at the 2019 Annual Meeting of Stockholders at the time and place shown below. Unless the context otherwise requires, the references to “we”, “us” or “our” refer to the Company and its consolidated subsidiary National CineMedia, LLC (“NCM LLC”).
2019 Annual Meeting of Stockholders
Date and Time		Location		Record Date	Mailing Date
May 2, 2019 9:00 am MDT		6300 South Syracuse Way, Suite 300, Centennial, Colorado 80111		March 4, 2019	On or about March 14, 2019

Meeting Agenda and Board Recommendations
Proposals for your vote				Board Voting Recommendation	Required Vote		Page Reference
Proposal 1: Election of Directors				FOR each nominee	Plurality of votes cast		7
Proposal 2: To approve, on an advisory basis, our executive compensation				FOR	Majority of votes present and entitled to vote		40
Proposal 3: To ratify the appointment of Deloitte & Touche LLP as our independent auditors				FOR	Majority of votes present and entitled to vote		41

Director Nominees

Nominee	Age	Director Since	Independent	Occupation	Current Committee Membership*
					A	C	NG
Thomas F. Lesinski	59	2014**	Yes	Chief Executive Officer of Sonar Entertainment	l
Andrew P. Glaze	40	2018	Yes	Research Analyst at Standard General		l	Chair
Lawrence A. Goodman	64	2007	Yes	Former President of Sales and Marketing of CNN		l	l
David R. Haas	77	2007	Yes	Private Investor and Financial Consultant, Retired Senior Vice President and Controller of Time Warner, Inc.	Chair	l
Kurt C. Hall	59	2007-2016; 2019	No	Former President and Chief Executive Officer of NCM and Former Chairman of the NCM Board
Lee Roy Mitchell	82	2006	No	Chairman of Cinemark Holdings, Inc.
Mark B. Segall	56	2018	Yes	Founder and Managing Director of Kidron Corporate Advisors, LLC	l	Chair	l
Renana Teperberg	41	2018	No	Chief Commercial Officer and member of the Board of Directors of Cineworld Group, plc
* A = Audit Committee, C = Compensation Committee, NG = Nominating and Governance Committee ** Chairman of the Board since 2018



PROXY SUMMARY (CONTINUED)
CORPORATE GOVERNANCE HIGHLIGHTS NCM demands integrity and is committed to upholding high ethical standards. Our strong corporate governance practices support this commitment and provide a framework within which our Board of Directors and management can pursue the strategic objectives of the Company and ensure long-term growth for the benefit of our stockholders. Highlights of our corporate governance practices are summarized below.
Accountability: – Following declassification of our Board of Directors in 2018, all directors now stand for election annually. – Directors are elected by a plurality of votes cast, subject to our director resignation policy. If a director who is not designated pursuant to contractual rights is elected by a plurality of votes cast but fails to receive a majority of votes cast, the director must tender his or her resignation to the Board for its consideration. – All directors are subject to anti-pledging and anti-hedging provisions under our Insider Trading Policy.
Independence: – 5 of 8 director nominees are independent with all of the non-independent directors serving as designees of our largest stockholder or founding members. – Board committees are comprised solely of independent directors. – Independent directors regularly meet in private without management.
Board Practices: – In fiscal 2018, no director nominee attended fewer than 75% of the meetings of our Board of Directors, or meetings of any Board committee on which he or she served. – Board of Directors and each Board committee conducts an annual self-assessment. – Continuing education budget is provided for each director.
Leadership Structure: – Separate Chairman and Chief Executive Officer leadership structure to maintain independence between Board oversight and operating decisions of the Company.
Stock Ownership Requirements: – Executive and director stock ownership requirements must be met within five years of appointment, as follows: – CEO: Lesser of three times base salary or 140,000 shares. – President and Executive Vice Presidents: Lesser of base salary or 20,000 shares. – Non-employee directors: Lesser of three times annual Board cash retainer or 8,000 shares. – As of March 4, 2019, all executive officers and directors meeting the tenure requirement were in compliance with the share ownership guidelines.
Key Corporate Governance Changes: – In July 2018, Scott N. Schneider resigned as Non-Employee Chairman of the Board of Directors after serving as a director for over 11 years. Thomas F. Lesinski, an independent director, was appointed Chairman in August 2018. – Also in July 2018, we declassified our Board of Directors following stockholder approval at our 2018 Annual Meeting of Stockholders. All of our directors now stand for election annually. – In January 2019, our Board of Directors adopted a director resignation policy, requiring directors who are not designated pursuant to contractual rights to tender their resignations for consideration by the Board if they receive a plurality of votes cast but fail to receive a majority of votes cast. – Also in January 2019, the Board of Directors accelerated Standard General L.P.'s second director nominee pursuant to the letter agreement entered into on June 1, 2018 and unanimously elected Kurt C. Hall to the Board of Directors.

NATIONAL CINEMEDIA, INC.

PROXY STATEMENT FOR THE

2019 ANNUAL MEETING OF STOCKHOLDERS

May 2, 2019

9:00 a.m., Mountain Time

QUESTIONS AND ANSWERS



Q:	Why am I receiving these proxy materials?



A:	You received these proxy materials because our Board of Directors is soliciting your proxy to vote your shares at our Annual Meeting. By giving your proxy, you authorize persons selected by the Board to vote your shares at the Annual Meeting in the way that you instruct. All shares represented by valid proxies received before the Annual Meeting will be voted in accordance with the stockholder's specific voting instructions. We are electronically disseminating our Annual Meeting materials by using the "Notice and Access" method approved by the Securities and Exchange Commission. The Notice of Internet Availability of Proxy Materials contains specific instructions on how to access Annual Meeting materials via the internet as well as how to receive paper copies if preferred. Our proxy materials are also available on the Internet at www.edocumentview.com/ncmi. We will hold the Annual Meeting at our offices located at 6300 South Syracuse Way, Suite 300, Centennial, Colorado 80111, on May 2, 2019 at 9:00 a.m., Mountain Time.



Q:	What specific proposals will be considered and acted upon at NCM, Inc.’s Annual Meeting?



A:	The specific proposals to be considered and acted upon at the Annual Meeting are:
	Proposal No. 1 — To elect eight directors, each to serve a one-year term and until his or her respective successor is duly elected or qualified; Proposal No. 2 — To approve, on an advisory basis, the compensation of our named executive officers; and Proposal No. 3 — To ratify the appointment of Deloitte & Touche LLP as our independent auditors for the fiscal year ending December 26, 2019. Management knows of no other business to be presented for action at the Annual Meeting, other than those items listed in the notice of the Annual Meeting referred to herein. If any other business should properly come before the Annual Meeting, or any adjournments or postponements thereof, it is intended that the proxies will be voted in the discretion of the proxy holders.



Q:	What is included in the proxy materials?



A:	The proxy materials include the Company’s Notice of Annual Meeting of Stockholders, proxy statement and the Annual Report for the fiscal year ended December 27, 2018, which includes our audited consolidated financial statements.



Q:	What do I need to bring with me to attend the Annual Meeting?



A:	If you are a stockholder of record of shares of our common stock, please bring photo identification with you. If you are a beneficial owner of shares of our common stock held in “street name,” please bring photo identification and the “legal proxy,” which is described below under the question “If I am a beneficial owner of shares held in ‘street name,’ how do I vote?”, or other evidence of stock ownership (e.g., most recent account statement) with you. If you do not provide photo identification or if applicable, evidence of stock ownership, you will not be admitted to the Annual Meeting.



Q:	Who can vote at the Annual Meeting?



A:	Our Board of Directors has fixed the close of business on March 4, 2019 as the record date. We had 78,960,633 shares of our common stock outstanding as of the close of business on the record date, including unvested restricted common stock with voting rights.



Q:	How many votes am I entitled per share of common stock?



A:	Holders of our common stock are entitled to one vote for each share of common stock held as of the record date.



Q:	What is the difference between holding NCM, Inc.’s shares of common stock as a stockholder of record and a beneficial owner?



A:	Most of our stockholders hold their shares of our common stock as a beneficial owner through a broker, bank or other nominee in “street name” rather than directly in their own name. As summarized below, there are some important distinctions between shares held of record and those owned beneficially in “street name.”
	Stockholder of Record: If your shares of our common stock are registered directly in your name, you are considered the stockholder of record with respect to those shares, and we delivered these proxy materials directly to you. As the stockholder of record, you have the right to vote your shares in person or by proxy at the Annual Meeting. Beneficial Owner: If your shares of our common stock are held in an account with a broker, bank or other nominee, you are considered the beneficial owner of those shares held in “street name,” and the broker, bank or other nominee holding your shares on your behalf delivered these proxy materials to you. The nominee holding your shares is considered the stockholder of record for purposes of voting at the Annual Meeting. As the beneficial owner, you have the right to direct your broker, bank or other nominee how to vote your shares being held by them.



Q:	If I am a stockholder of record of NCM, Inc. shares, how do I vote?



A:	Voting by Internet. You can vote through the Internet by following the instructions provided in the proxy card that you received. Go to www.edocumentview.com/ncmi, follow the instructions on the screen to log in, make your selections as instructed and vote.
	Voting by Mail. You can vote by mail by completing, dating, signing and returning the proxy card in the postage-paid envelope (to which no postage need be affixed if mailed in the United States) accompanying the proxy card that you received. Voting in Person. If you plan to attend the Annual Meeting and vote in person, we will give you a ballot at the Annual Meeting. Even if you plan to attend the Annual Meeting, we encourage you also to vote by Internet or mail as described above so that your vote will be counted if you later decide not to attend the Annual Meeting.



Q:	If I am a beneficial owner of shares held in “street name,” how do I vote?



A:	Voting by Internet. You can vote over the Internet by following the voting instruction card provided to you by your broker, bank, trustee or nominee.
	Voting by Mail. You can vote by mail by completing, dating, signing and returning the voting instruction form in the postage-paid envelope (to which no postage need be affixed if mailed in the United States) accompanying the voting instruction form that you received. Voting in Person. If you plan to attend the Annual Meeting and vote in person, you must obtain a “legal proxy” giving you the right to vote the shares at the Annual Meeting from the broker, bank or other nominee that holds your shares. Even if you plan to attend the Annual Meeting, we recommend that you also vote by Internet or mail as described above so that your vote will be counted if you later decide not to attend the Annual Meeting.



Q:	What if I submit a proxy but I do not give specific voting instructions?



A:	Stockholder of Record: If you are a stockholder of record of shares of our common stock, and if you indicate when voting through the Internet that you wish to vote as recommended by our Board of Directors, or if you sign and return a proxy without giving specific voting instructions, then the proxy holders designated by our Board of Directors, Clifford Marks and Sarah Hilty, who are officers of the Company, will vote your shares FOR the eight director nominees; FOR advisory approval of the Company’s executive compensation, and FOR the ratification of the selection of Deloitte & Touche LLP as our independent auditors for our 2019 fiscal year, all as recommended by our Board of Directors and as presented in this proxy statement.
	Beneficial Owner: If you are a beneficial owner of shares of our common stock held in “street name” and do not present the broker, bank or other nominee that holds your shares with specific voting instructions, then the nominee may generally vote your shares on “routine” proposals but cannot vote on your behalf for “non-routine” proposals under the rules of various securities exchanges. If you do not provide specific voting instructions to the nominee that holds your shares with respect to a non-routine proposal, the nominee will not have the authority to vote your shares on that proposal. When a broker indicates on a proxy that it does not have authority to vote shares on a particular proposal, the missing votes are referred to as “broker non-votes.”



Q:	Which ballot measures are considered “routine” or “non-routine”?



A:	The ratification of the appointment of Deloitte & Touche LLP as our independent auditors for fiscal 2019 (Proposal No. 3) is a matter considered routine under applicable rules. A broker or other nominee may generally vote on routine matters, and therefore no broker non-votes are expected to exist in connection with Proposal No. 3. The election of directors (Proposal No. 1) and the advisory approval of the Company’s executive compensation (Proposal No. 2) are matters considered non-routine under applicable rules. A bank, broker or other nominee cannot vote without instructions on non-routine matters, and therefore there may be broker non-votes on Proposal Nos. 1 and 2. A broker non-vote will have no effect on Proposal Nos. 1 and 2.



Q:	What is the quorum requirement for the Annual Meeting?



A:	A quorum is required for our stockholders to conduct business at the Annual Meeting. A majority of the outstanding shares of our common stock entitled to vote on the record date must be present in person or represented by proxy at the Annual Meeting in order to hold the meeting and conduct business. We will count your shares for purposes of determining whether there is a quorum if you are present in person at the Annual Meeting, if you have voted through the Internet, if you have voted by properly submitting a proxy card, or if the nominee holding your shares submits a proxy card. We will also count broker non-votes for the purpose of determining if there is a quorum.



Q:	What is the voting requirement to approve each of the proposals?



A:	For Proposal No. 1, each director will be elected by a plurality of the votes cast. This means that the eight director nominees who receive the greatest number of votes cast by the holders of our common stock entitled to vote at the Annual Meeting will be elected as directors. You are not entitled to cumulate votes in the election of directors and may not vote for a greater number of persons than the number of nominees named.
	Approval of Proposal No. 2, on an advisory basis, requires the affirmative vote of the holders of a majority of the shares of our common stock entitled to vote that are present in person or represented by proxy at the Annual Meeting. Approval of Proposal No. 3 requires the affirmative vote of the holders of a majority of the shares of our common stock entitled to vote that are present in person or represented by proxy at the Annual Meeting. The effectiveness of any of the proposals is not conditioned upon the approval by our stockholders of any other proposal by our stockholders. Standard General L.P. which holds 15.4 million shares or 19.4% of our outstanding common stock, has agreed to vote the shares of our common stock that it beneficially owns in favor of each nominee for director in Proposal No. 1 and in favor of Proposal No. 3 as required by the terms of the letter agreement between the Company and Standard General dated June 1, 2018.



Q:	How are abstentions treated?



A:	Abstentions will be counted as present for the purposes of determining whether a quorum is present at the Annual Meeting. A vote withheld for a nominee in the election of directors (Proposal No. 1) will have no effect on the election of the director nominee, although if a director who is not designated pursuant to contractual rights is elected by a plurality of votes cast but fails to receive a majority of votes cast, the director must tender his or her resignation to the Board for its consideration. For purposes of determining whether any of the other proposals have received the requisite vote, if a stockholder abstains from voting, it will have the same effect as a vote against such proposal.



Q:	Can I change my vote or revoke my proxy after I have voted?



A:	Any proxy given pursuant to this solicitation may be revoked by the person giving it at any time before its use by delivering to us (Attention: Secretary) a written notice of revocation or a duly executed proxy bearing a later date, or by attending the Annual Meeting and voting in person. Attendance at the Annual Meeting will not in itself constitute a revocation of a proxy.



Q:	Who is paying for the cost of this proxy solicitation?



A:	We will pay the cost of soliciting proxies for the Annual Meeting. We have retained Georgeson as our proxy solicitor and we will pay Georgeson approximately $5,500, plus expenses. Proxies may be solicited by our regular employees, without additional compensation, in person or by mail, courier, telephone or facsimile. We may also make arrangements with brokerage houses and other custodians, nominees and fiduciaries for the forwarding of solicitation material to the beneficial owners of stock held of record by such persons. We may reimburse such brokerage houses, custodians, nominees and fiduciaries for reasonable out-of-pocket expenses incurred by them in connection therewith.



Q:	What are the voting recommendations of our Board of Directors?



A:	Our Board of Directors recommends a vote FOR each of Proposal Nos. 1, 2 and 3. Specifically, our Board of Directors recommends a vote:
	FOR the election of each of Andrew P. Glaze, Lawrence A. Goodman, David R. Haas, Kurt C. Hall, Thomas F. Lesinski, Lee Roy Mitchell, Mark B. Segall and Renana Teperberg to our Board of Directors; FOR the advisory approval of the Company’s executive compensation; and FOR the ratification of the selection of Deloitte & Touche LLP as our independent accountants for fiscal year 2019.



Q:	Where can I find the Company’s Annual Report?



A:	Our 2018 Annual Report on Form 10-K, including the audited consolidated financial statements as of and for the year ended December 27, 2018, is available to all stockholders entitled to vote at the Annual Meeting together with this proxy statement, in satisfaction of the requirements of the Securities and Exchange Commission (the “SEC”). Additional copies of the Annual Report are available at no charge upon request. To obtain additional copies of the Annual Report, please contact us at 6300 South Syracuse Way, Suite 300, Centennial, Colorado 80111, Attention: Investor Relations, or at telephone number (303) 792-3600 or (800) 844-0935. You may also view the Annual Report at http://www.ncm.com at the Investor Relations link. The Annual Report does not form any part of the materials for the solicitation of proxies.



Q:	What is “householding” and how does it affect me?



A:	As permitted by applicable law, we intend to deliver only one copy of certain of our documents, including proxy statements, annual reports and information statements to stockholders residing at the same address, unless such stockholders have notified us of their desire to receive multiple copies thereof. Any such request should be directed to National CineMedia, Inc., 6300 South Syracuse Way, Suite 300, Centennial, Colorado 80111, Attention: Investor Relations, or by telephone at (303) 792-3600 or (800) 844-0935.
	Upon request, we will promptly deliver a separate copy. Stockholders who currently receive multiple copies of the proxy statement at their address and would like to request householding of their communications should contact their broker.



Q:	Whom should I call if I have questions about the Annual Meeting?



A:	You should call Georgeson, our proxy solicitor, at (866) 203-9357 or our Secretary at (303) 792-3600.

PROPOSAL NO. 1:

ELECTION OF DIRECTORS

Our Board of Directors has nominated the following eight directors for election at the Annual Meeting. Important summary information about the nominees for director is set forth in the table below. Following the table is certain biographical information about each nominee for director, as well as selected information about specific qualifications, attributes, skills and experience that led our Board to conclude that each nominee for director is qualified to serve on our Board.

Board Composition



Director Nominees

Nominee	Age	Director Since	Independent	Occupation	Current Committee Membership*
					A	C	NG
Thomas F. Lesinski	59	2014	Yes	Chief Executive Officer of Sonar Entertainment	l
Andrew P. Glaze	40	2018	Yes	Research Analyst at Standard General		l	Chair
Lawrence A. Goodman	64	2007	Yes	Former President of Sales and Marketing of CNN		l	l
David R. Haas	77	2007	Yes	Private Investor and Financial Consultant, Retired Senior Vice President and Controller of Time Warner, Inc.	Chair	l
Kurt C. Hall	59	2007-2016; 2019	No	Former President and Chief Executive Officer of NCM and Former Chairman of the NCM Board
Lee Roy Mitchell	82	2006	No	Chairman of Cinemark Holdings, Inc.
Mark B. Segall	56	2018	Yes	Founder and Managing Director of Kidron Corporate Advisors, LLC	l	Chair	l
Renana Teperberg	41	2018	No	Chief Commercial Officer and member of the Board of Directors of Cineworld Group, plc
* A = Audit Committee, C = Compensation Committee, NG = Nominating and Governance Committee

Our Board of Directors currently consists of eight directors. Under the director designation agreement dated as of February 13, 2007 (the “Director Designation Agreement”), two of our founding members – Cinemark and Regal – are permitted to appoint or designate up to two persons for nomination to election on our Board of Directors under the terms set forth in the Director Designation Agreement, one of whom must qualify as “independent” as required by the rules promulgated by the SEC under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and by the Nasdaq Stock Market (“Nasdaq”). See “Certain Relationships and Related Party Transactions – Transactions with Founding Members – Director Designation Agreement.” The designees pursuant to the Director Designation Agreement for Cinemark are Thomas F. Lesinski and Lee Roy Mitchell and for Regal are Mark B. Segall and Renana Teperberg.

Under the letter agreement entered into on June 1, 2018 with Standard General L.P. ("Letter Agreement"), Standard General is permitted to appoint or designate up to two persons for nomination to election of our Board of Directors. See “Certain Relationships and Related Party Transactions - Other Transactions – Letter Agreement.” The designees pursuant to the Letter Agreement are Andrew P. Glaze and Kurt C. Hall.

Our Certificate of Incorporation provides that all directors are included within one class and that the number of total directors will not be more than eleven. The number of current director positions is eight pursuant to our Bylaws. Each member serves a one-year term until the next Annual Meeting and until his or her successor is duly elected and qualified.

Business Experience of Nominees

We are soliciting proxies in favor of the election of each nominee identified below. All nominees have consented to serve as directors, if elected. If any nominee is unable or unwilling to serve as a director at the time of the Annual Meeting, the persons who are designated as proxies intend to vote, in their discretion, for such other persons, if any, as may be designated by our Board of Directors. The proxies may not vote for a greater number of persons than the number of nominees named. As of the date of this proxy statement, our Board of Directors has no reason to believe that any of the persons named below will be unable or unwilling to serve as a nominee or as a director.

The names of the nominees and other information about them, including their directorships at public companies held at any time during the past five years, if applicable, and their involvement in certain legal proceedings during the past ten years, if applicable, are set forth below. In addition, we have included information about each nominee’s experience, qualifications, attributes or skills that led our Board of Directors to conclude that the nominee should serve as a director of the Company, in light of our business and corporate structure.



Thomas F. Lesinski Non-Employee Chairman Independent Director Director Since: 2014 Age: 59 Committees: Audit	Mr. Lesinski has served as the Chief Executive Officer of Sonar Entertainment, an independent entertainment studio, since January 2016. Mr. Lesinski served as the founder and CEO of Energi Entertainment, a multi-media content production company, from August 2014 until December 2015. From 2013 to 2014, Mr. Lesinski was President of Digital Content and Distribution at Legendary Entertainment, a leading media company dedicated to owning, producing and delivering content to mainstream audiences with a targeted focus on the powerful fandom demographic. Prior to that role, from 2006 to 2013, Mr. Lesinski served as President, Digital Entertainment at Paramount Pictures, a global producer and distributor of filmed entertainment. Mr. Lesinski also served as President of Worldwide Home Entertainment at Paramount Pictures for three years, prior to which, he spent ten years in various leadership positions at Warner Bros. Entertainment and was a Managing Director for an advertising agency. Mr. Lesinski has served as Non-Employee Chairman since August 1, 2018.
	Qualifications: Mr. Lesinski’s experience in home entertainment and digital media gives him the experience to critically review the various business considerations necessary to run a business such as ours and offers a valuable perspective as the media marketplace becomes more competitive, particularly with the growth of online and mobile advertising platforms. Mr. Lesinski's experience as a Chief Executive Officer provides valuable perspective as our Chairman.



Andrew P. Glaze Independent Director Director Since: 2018 Age: 40 Committees: Compensation Nominating and Governance - Chair	Mr. Glaze has served as a Research Analyst at Standard General since 2016. Before joining Standard General, Mr. Glaze was a Managing Director at Claar Advisors, LLC, which he joined in 2014. Mr. Glaze was the founder, and, from 2009 to 2014, the Chief Investment Officer of, Emys Capital, LLC. Prior to this he was an investment banking associate on the Consumer and Leveraged Finance teams at Merrill Lynch. Mr. Glaze began his career in the United States Army where he served as an officer for five years in the 1st Cavalry division. As part of his service, Mr. Glaze deployed to Baghdad, Iraq for one year where he served with distinction as a Captain and Aviation Brigade Fire Support Officer. Mr. Glaze is a service-disabled veteran. He holds a B.S. from the United States Military Academy at West Point and an M.B.A. from Columbia Business School, where he participated in the highly selective Value Investing Program. He is also a member of the Success Academy Charter Network Advisory Board. Mr. Glaze is a Chartered Financial Analyst.
	Qualifications: Mr. Glaze’s extensive experience in financial analysis and organizational leadership qualifies him to serve on our Board.



Lawrence A. Goodman Independent Director Director Since: 2007 Age: 64 Committees: Compensation Nominating and Governance	Mr. Goodman founded White Mountain Media, a media consulting company, in July 2004 and served as its president since inception until 2015. From July 2003 to July 2004, Mr. Goodman was retired. From March 1995 to July 2003, Mr. Goodman was the President of Sales and Marketing for CNN, a division of Turner Broadcasting System, Inc.
	Qualifications: Mr. Goodman’s extensive background in the media industry allows him to provide media sales and marketing advice to our management and Board. Mr. Goodman brings significant business experience to provide strategies and solutions to resolve the issues addressed by our Board.



David R. Haas Independent Director Director Since: 2007 Age: 77 Committees: Audit - Chair Compensation	Mr. Haas has been a private investor and financial consultant since January 1995. Mr. Haas was a Senior Vice President and Controller for Time Warner, Inc. from January 1990 through December 1994.
	Qualifications: Mr. Haas’ experience as a former high-ranking financial executive in a media company qualifies him to serve on our Board of Directors and as chairman of our Audit Committee and to provide guidance to our internal audit function and financial advice to our Board. In addition, Mr. Haas’ previous experience serving on several public company boards and audit committees has provided him a broad-based understanding of financial risks and compliance expertise.



Kurt C. Hall Director Director Since: 2019 Age: 59 Committees: None	Mr. Hall was appointed President, Chief Executive Officer and Chairman of National CineMedia, LLC in May 2005, and, following the Company’s IPO in 2007, assumed the same positions with National CineMedia Inc. Prior to this, from May 2002 to May 2005, Mr. Hall served as Co-Chairman and Co-Chief Executive Officer of Regal Entertainment Group and President and Chief Executive Officer of its media subsidiary and NCM predecessor, Regal CineMedia Corporation. Previously, Mr. Hall had served as President and Chief Executive Officer of United Artists Theatre Company from March 1998 to August 2002, and as a Director from May 1992 to August 2002. Prior to this, Mr. Hall served as Chief Operating Officer of United Artists Theatre Company from February 1997 to March 1998, and as Executive Vice President and Chief Financial Officer from May 1992 to March 1998. Mr. Hall had also served as Vice President and Treasurer and in various other financial and accounting positions within United Artists’ predecessor companies since January of 1988.
	Qualifications: Mr. Hall's extensive background with the Company and our business allows him to provide sales and management advice to our management and Board.



Lee Roy Mitchell Director Director Since: 2006 Age: 82 Committees: None	Mr. Mitchell has served as Chairman of the Board of Cinemark Holdings, Inc. since March 1996 and as a director since its inception in 1987. Mr. Mitchell served as Chief Executive Officer of Cinemark Holdings, Inc. from its inception in 1987 until December 2006, Vice Chairman of the Board from March 1996 and was President from inception in 1987 until March 1993.
	Qualifications: Mr. Mitchell has over four decades of executive leadership experience, including a key role in the theater industry and brings important institutional knowledge to our Board. Mr. Mitchell’s experience enables him to share with our Board suggestions about how similarly situated companies effectively assess and undertake business considerations and opportunities. Since Mr. Mitchell is a Board designee for one of our founding members, he brings to our Board the perspective of a major stakeholder.



Mark B. Segall Independent Director Director Since: 2018 Age: 56 Committees: Audit Compensation - Chair Nominating and Governance	Mr. Segall is the owner and Managing Director of Kidron Corporate Advisors, LLC, a New York based mergers and acquisitions corporate advisory boutique founded in 2003, and has been the CEO of Kidron Capital Advisors LLC since 2009. Previously, he served as the Co-Chief Executive Officer of Investec, Inc., an asset management company, from 2001 to 2003, following his role as Investec Inc.’s head of investment banking and general counsel. Prior to that, he was a partner at the law firm of Kramer, Levin, Naftalis & Frankel LLP, specializing in cross-border mergers and acquisitions and capital markets activities. Mr. Segall serves as a director of the following public companies: iAM Capital Plc (and certain related affiliated companies) (2000 to 2014 and 2018 to present) and Bel Fuse, Inc. (2011 to present). In the past five years he has served on other public company boards including: Ronson Europe N.V. (2008 to 2017), Temco Service Industries, Inc. (2011 to 2016), Infinity Cross Border Acquisition Corp. (2012 to 2014), and ATMI, Inc. (2013 to 2014). Mr. Segall also serves on a number of private company boards.
	Qualifications: Mr. Segall’s two decades of board leadership experience at both public and private companies, gives him the ability to offer guidance to the Company and its operations.



Renana Teperberg Director Director Since: 2018 Age: 41 Committees: None	Ms. Teperberg has served as Chief Commercial Officer of Cineworld Group plc since 2016, Senior Vice President Commercial from 2014 to 2015, and a member of the Cineworld Group plc Board of Directors since 2018. Prior to that time, she served as Head of Programming and Marketing for Cinema City International from 2002 to 2013. On February 28, 2018, Cineworld Group plc acquired the parent corporation of Regal.
	Qualifications: Ms. Teperberg has extensive experience in the cinema industry which enables her to share with our Board suggestions about how similarly situated companies effectively assess and undertake business considerations and opportunities. As Ms. Teperberg is a Board designee for one of our founding members, she brings to our Board the perspective of a major stakeholder.

Vote Required

Directors will be elected by a plurality of the votes of the holders of shares present in person or by proxy at the Annual Meeting.

Director Resignation Policy

It is the Company's desire that any director elected to the Board of Directors in an uncontested election shall receive a majority vote of stockholders. As such, in the event of an uncontested election where a nominee not designated pursuant to a contractual right is elected by a plurality but not a majority of votes cast, the director will tender his or her resignation to the Chairman of the Board. The Nominating and Governance Committee will recommend to the Board the action to be taken with respect to the resignation. The Board will decide to accept or reject such resignation, taking into account the Nominating and Governance Committee’s recommendation, and publicly disclose its decision within 90 days from the date of certification of the election results. The Nominating and Governance Committee and the Board may consider such factors or other information they deem appropriate and relevant in deciding whether to accept or reject a resignation tendered in accordance with this policy. A director whose resignation is under consideration will abstain from participating in any decision regarding the resignation. If the nominee is designated pursuant to a contractual right, the Company will consult with the designating entity about the possibility of a different candidate at the following year's annual meeting.

Recommendation

Our Board of Directors recommends that stockholders vote FOR each of the nominees for director. If not otherwise specified, proxies will be voted FOR each of the nominees for director.

Independence of our Board of Directors

Our Board of Directors has determined that Andrew P. Glaze, Lawrence A. Goodman, David R. Haas, Thomas F. Lesinski and Mark B. Segall, all current directors of the Company, qualify as “independent” directors under the rules promulgated by the SEC under the Exchange Act, and by Nasdaq. There are no family relationships among any of our executive officers, directors or nominees for director. For further detail of related party transactions, refer to “Certain Relationship and Related Party Transactions” located elsewhere in this document.

Company Leadership Structure

Our Board determined to split the roles of Chairman of the Board of Directors and Chief Executive Officer. Our Interim Chief Executive Officer is responsible for setting the strategic direction for the Company and the day to day leadership and performance of the Company, while our Chairman sets the agenda for Board meetings and presides over meetings of the full Board in its oversight role. We believe this leadership structure will best serve the objectives of our Board’s oversight of management, our Board’s ability to carry out its roles and responsibilities on behalf of our stockholders, and the Company’s overall corporate governance.

Mr. Lesinski assumed the position of Chairman of our Board of Directors on August 1, 2018.

Our Board plans to periodically review the leadership structure to determine whether it continues to best serve the Company and our stockholders.

Board’s Role in Risk Oversight

Our Board as a whole has responsibility for risk oversight, including setting the “tone at the top” regarding the importance of risk management. Our Board reviews information on the Company’s credit, liquidity and operations, as well as reports from management on enterprise risk and committee reports. Our Compensation Committee is responsible for overseeing the management of risks relating to our executive compensation. Our Audit Committee is responsible for overseeing the management of financial risks, including cybersecurity risks. Our Nominating and Governance Committee is responsible for overseeing the management of risks associated with board independence and potential conflicts of interests. While each committee is responsible for evaluating and overseeing the management of such risks, the entire Board is regularly informed of each committee’s analysis.

Katherine L. Scherping, Chief Financial Officer is our Chief Risk Officer. The Chief Risk Officer provides periodic updates to our Board on the strategic, operational, financial, cybersecurity, compliance and reputational risks facing the Company, which serves to ensure that risk management is a priority within the organization and the Company’s risk oversight is aligned with its strategies.

Compensation Risk Assessment

We do not believe we have compensation practices that are reasonably likely to have a material adverse effect on the Company. Our Compensation Committee reviews the compensation policies and practices for all employees, including executive officers. Among other things, our Compensation Committee considers whether the compensation program encourages excessive risk taking by employees at the expense of long-term Company value. Based upon its assessment, our Compensation Committee does not believe that our compensation program encourages excessive or inappropriate risk-taking. Our Compensation Committee believes that the design of our compensation program, which includes a mix of annual and long-term incentives, cash and equity awards and retention incentives, is balanced and does not motivate imprudent risk-taking.

Meetings of our Board of Directors and Standing Committees

Our Board of Directors held eighteen meetings during the fiscal year ended December 27, 2018. During our 2018 fiscal year, no director then in office attended fewer than 75% of the aggregate total number of meetings of our Board of Directors held during the period in which he or she was a director and of the total number of meetings held by all of the committees of our Board of Directors on which he or she served. The Company does not have a formal policy regarding attendance by members of our Board of Directors at the Company’s Annual Meeting, but encourages our directors to attend. Eight of our then nine directors attended our Annual Meeting of Stockholders held on July 6, 2018. The three standing committees of our Board of Directors are our Audit Committee, our Compensation Committee and our Nominating and Governance Committee. Periodically our Board has established a special committee to review significant transactions and other matters.

The following table shows the current membership:

DIRECTOR COMMITTEE MEMBERSHIP




Director	Audit Committee	Compensation Committee	Nominating and Governance Committee	Board of Directors
Andrew P. Glaze		X	Chair	X
Lawrence A. Goodman		X	X	X
David R. Haas	Chair	X		X
Kurt C. Hall				X
Thomas F. Lesinski	X			Chair
Lee Roy Mitchell				X
Mark B. Segall	X	Chair	X	X
Renana Teperberg				X

Audit Committee

Our Audit Committee consists of David R. Haas (chairman), Thomas F. Lesinski and Mark B. Segall. Each of the committee members was determined to be “independent” as required by the rules promulgated by the SEC under the Exchange Act and by Nasdaq. Each of them also meets the financial literacy requirements of Nasdaq. Our Board of Directors has determined that Mr. Haas qualifies as an “audit committee financial expert” as defined in the federal securities laws and regulations.

Our Audit Committee is primarily concerned with overseeing management’s processes and activities relating to the following:


(1)	maintaining the reliability and integrity of our accounting policies, financial reporting practices and financial statements;


(2)	the independent auditor’s qualifications and independence;


(3)	the performance of our internal audit function and independent auditor; and


(4)	confirming compliance with laws and regulations, and the requirements of any stock exchange or quotation system on which our securities may be listed.

Our Audit Committee also is responsible for establishing procedures for the receipt of complaints regarding our accounting, internal accounting controls or audit matters, and the confidential, anonymous submission of concerns regarding questionable accounting or auditing matters. Our Audit Committee’s responsibilities are set forth in its charter, the current version of which was most recently reviewed by the Committee and approved by our Board in January 2019 in conjunction with the charter's annual review. The current version of the charter is available on our website at www.ncm.com at the Investor Relations link. There were ten meetings of our Audit Committee during our 2018 fiscal year.

Compensation Committee

Our Compensation Committee consists of Mark B. Segall (chairman), Andrew P. Glaze, Lawrence A. Goodman, and David R. Haas. Each member was determined to be “independent” as defined in the rules promulgated by the SEC under the Exchange Act and by Nasdaq, and each also qualifies as an “outside director” within the meaning of Section 162(m) of the Internal Revenue Code and a “non-employee director” for purposes of Rule 16b-3 under the Exchange Act.

Our Compensation Committee’s purposes, as set forth in its charter, include:


(1)	to assist our Board in discharging its responsibilities relating to compensation of our CEO and other executives;


(2)	to administer our equity incentive plans (other than equity compensation for non-employee directors which is administered by our Board); and


(3)	to have overall responsibility for approving and evaluating all of our compensation plans, policies and programs that affect our executive officers.

Our Compensation Committee’s responsibilities are set forth in its charter, which is reviewed at least annually. The current Compensation Committee charter was most recently reviewed by the Committee and approved by our Board in January 2019. The current version of the charter is available on our website at www.ncm.com at the Investor Relations link. There were seven meetings of our Compensation Committee during our 2018 fiscal year.

Our Compensation Committee engaged ClearBridge Compensation Group, LLC (“ClearBridge”), a nationally recognized consulting firm, to assess the competitiveness of compensation for the executive officers and provide independent

advice and recommendations to our Compensation Committee regarding executive compensation. Prior to retaining ClearBridge, our Compensation Committee reviewed ClearBridge’s independence as contemplated by the committee’s charter and applicable Nasdaq rules, and determined that there were no conflicts of interest and that ClearBridge is independent from the Company, our Compensation Committee and our executive officers.

Nominating and Governance Committee

Our Nominating and Governance Committee consists of Andrew P. Glaze (Chairman), Lawrence A. Goodman, and Mark B. Segall. Each of the members of our Nominating and Governance Committee was determined to be independent in accordance with Nasdaq rules and relevant federal securities laws and regulations.

Our Nominating and Governance Committee’s purposes, as set forth in its charter, include:


(1)	to identify individuals qualified to become Board members, and to recommend director nominees to our Board;


(2)	to oversee the evaluation of our Board; and


(3)	to review from time to time the Corporate Governance Guidelines applicable to us and to recommend to our Board such changes as it may deem appropriate.

Our Nominating and Governance Committee’s responsibilities are set forth in its charter, which was most recently reviewed by the Committee and approved by our Board in January 2019. The current version of the charter as well as our Corporate Governance Guidelines are available on our website at www.ncm.com at the Investor Relations link. There were nine meetings of our Nominating and Governance Committee during our 2018 fiscal year.

Other than the director candidates designated by our founding members or by Standard General pursuant to the Letter Agreement, our Nominating and Governance Committee identifies individuals qualified to become Board members and recommends director nominees to our Board for each annual meeting of stockholders or in connection with filling a vacancy on our Board between annual meetings. It also reviews the qualifications and independence of the members of our Board of Directors and its various committees on a regular basis and makes any recommendations the committee members may deem appropriate from time to time concerning any changes in the overall composition of our Board of Directors and its committees. Our Nominating and Governance Committee recommends to our Board of Directors the terms of our Corporate Governance Guidelines. Our Nominating and Governance Committee reviews such guidelines and the provisions of our Nominating and Governance Committee charter on a regular basis to confirm that such guidelines and charter remain consistent with sound corporate governance practices and with any legal, regulatory or Nasdaq requirements. Our Nominating and Governance Committee also monitors our Board of Directors and our compliance with any commitments made to regulators or otherwise regarding changes in corporate governance practices and leads our Board of Directors in its annual review of our Board of Directors.

Nomination of Directors. The nominees for election to our Board of Directors at the 2019 Annual Meeting were formally nominated by our Nominating and Governance Committee, and were approved by our Board of Directors on February 19, 2019. All the nominees are current directors.

As the need to fill vacancies arises in the future, our Nominating and Governance Committee will refer to its list of potential candidates that is maintained and updated on an on-going basis and will seek individuals qualified to become Board members for recommendation to our Board. Our Nominating and Governance Committee would consider potential director candidates recommended by stockholders and use the same criteria for screening all candidates, regardless of who proposed such candidates. See “Stockholder Communications” below for information on how our stockholders may communicate with our Board of Directors. See “Proposals of Stockholders” below for further information on making director nominations.

Our Nominating and Governance Committee and Board of Directors consider whether candidates for nomination to our Board of Directors possess the following qualifications, among others:


(a)	the highest level of personal and professional ethics, integrity, and values;


(b)	expertise that is useful to us and is complementary to the background and expertise of the other members of our Board of Directors;


(c)	a willingness and ability to devote the time necessary to carry out the duties and responsibilities of membership on our Board of Directors;


(d)	a desire to ensure that our operations and financial reporting are effected in a transparent manner and in compliance with applicable laws, rules, and regulations; and


(e)	a dedication to the representation of the best interests of all our stockholders, including our founding members.

Diversity of Directors. In considering whether to recommend any candidate for inclusion in the slate of director nominees, our Nominating and Governance Committee complies with the Company’s Corporate Governance Guidelines and Corporate Code of Business Conduct and Ethics. In addition to considering the qualifications listed above, the Committee seeks

nominees that will complement the existing members and provide diversity of background, professional expertise, gender and ethnicity. Our Nominating and Governance Committee periodically reviews and assesses its evaluation process for considering nominee directors.

STOCKHOLDER COMMUNICATIONS

Our Board of Directors provides a process for stockholders to send communications to our Board. Information on communicating directly with our Board of Directors is available on our website at the Investor Relations link, under the Corporate Governance section or http://investor.ncm.com/corporate-governance/contact-the-board.

COMPENSATION DISCUSSION AND ANALYSIS

Introduction

This Compensation Discussion and Analysis (“CD&A”) explains the executive compensation program for the following individuals, who are referred to as the “Named Executive Officers” (“NEOs”).


•	Clifford E. Marks – Interim Chief Executive Officer and President


•	Andrew J. England – Former Chief Executive Officer and Director (until November 2, 2018)


•	Katherine L. Scherping – Chief Financial Officer


•	Scott D. Felenstein – Executive Vice President and Chief Revenue Officer


•	Sarah Kinnick Hilty – Senior Vice President, General Counsel and Secretary (since February 12, 2018)


•	Ralph E. Hardy – Former Executive Vice President, General Counsel and Secretary (until February 12, 2018)

Executive Summary

Fiscal Year 2018 Performance. Total revenue for the year ended December 27, 2018 increased 3.6% to $441.4 million from $426.1 million for the comparable prior year period. Adjusted OIBDA increased 0.1% to $205.4 million for the full year of 2018 from $205.1 million for the full year of 2017. Operating income increased 0.3% from $153.9 million in 2017 to $154.3 million in 2018. Net income decreased from $58.3 million in 2017 to $29.8 million in 2018.

Key Performance Measures. The following tables summarize the key fiscal 2018 financial metrics on which the Company based its executive compensation.



Fiscal 2018 Performance Measures (in millions) (1)
	Target		Actual		Achievement relative to target
Adjusted OIBDA for Compensation Purposes	$	180.3	$	176.9	98.1% of targeted Adjusted OIBDA for Compensation Purposes
Adjusted Advertising Revenue	$	411.9	$	406.6	98.7% of targeted Adjusted Advertising Revenue target

(1)

Refer to “Annual Cash Incentive” below for additional details on the Non-Equity Incentive Plan, Adjusted OIBDA for Compensation Purposes and Adjusted Advertising Revenue, which are non-GAAP measures. See “Definitions of Performance Measures Used in Incentive Plans for Fiscal 2018” below for the definitions of Adjusted OIBDA for Compensation Purposes and Adjusted Advertising Revenue and the reconciliations to the closest GAAP based measurement.


(1)	Refer to “Long-Term Incentives (LTI)” section below for additional details on the 2016 Equity Plan and Free Cash Flow which is a non-GAAP measure. See “Definitions of Performance Measures Used in Incentive Plans for Fiscal 2018” below for the definitions of Free Cash Flow and the reconciliations to the closest GAAP based measurement.

Elements of 2018 Compensation Program. Our Compensation Committee believes that the Company’s compensation policies and procedures are aligned with the short-term and long-term interests of our stockholders and are designed to attract, motivate, reward and retain superior talent who are critical to our long-term growth and profitability. The 2018 Compensation Program consists of the following pay elements:

Base

Salary

Annual Cash

Incentive

Performance-

Based

Restricted Stock (PBRS)

Time-Based

Restricted Stock (TBRS)

Total Direct Compensation

The designs for the Annual Cash Incentive Plan and Long-Term Incentive Plan were generally maintained from the 2017 Compensation Program, based on our Compensation Committee’s assessment that the compensation program continued to align with the Company’s business and compensation objectives.

Other aspects of the Company’s executive compensation program are intended to further align the interests of our NEOs with those of our stockholders and to promote good corporate governance. These include:

• Meaningful stock ownership guidelines for executives;

• No tax gross-ups on severance agreements or change in control-related payments;

• A cap on maximum annual performance incentives;

• No special or supplemental pension or death benefits for our NEOs; and

• Adoption of anti-pledging, anti-hedging, and clawback policies.

Pay Mix. We believe the mix of annual and long-term incentives and the mix of cash and equity awards are balanced, emphasize Company performance and do not motivate imprudent risk-taking. The following charts present the elements of compensation as a percentage of total target direct compensation for fiscal year 2018, computed using the annual salary, target annual cash incentive (assuming 100% achievement) and grant date fair value of Performance-Based Restricted Stock ("PBRS") and Time-Based Restricted Stock ("TBRS"). The first chart presents the compensation elements for our former CEO, Andrew J. England, until his separation from service and a prorated portion of our interim CEO and President, Clifford E. Marks's compensation for the remainder of 2018. The NEOs included in the second chart are Mr. Felenstein, Mses. Scherping and Hilty, and a prorated portion of Mr. Marks's compensation prior to Mr. England's separation from service.

Fiscal Year 2018 Compensation Mix

Chief Executive Officer (a)


(a)	Approximately 62% of Messrs. England and Marks’s combined compensation is performance-based and approximately 74% of their compensation is variable, which represents the performance-based elements and time-based restricted stock.

Other NEOs (b)


(b)	Approximately 47% of all other NEOs’ compensation is performance-based and approximately 64% of their compensation is variable, which represents the performance-based elements and time-based restricted stock.

Pay-for-Performance Alignment. Our Compensation Committee believes that having a large percentage of executive officers’ pay as performance-based compensation ensures that their interests are aligned with those of our stockholders. Consistent with our compensation program design, our compensation program results for the 2018 fiscal year were aligned with the Company’s financial results. The fiscal year 2018 annual cash incentives paid out below target (92.1%) as described in greater detail in “Fiscal 2018 Non-Equity Incentive Plan Payments.” PBRS paid out below target (27.7%) for the 2016-2018 performance period, as described in greater detail in “Long-Term Incentives.”

CEO Transition Plan. Andrew J. England stepped down as CEO effective November 2, 2018. Effective November 5, 2018 the Board appointed Clifford E. Marks to serve as Interim Chief Executive Officer, in addition to his previous role of Company President. His duties were expanded from leading the Company's sales and marketing departments, advertising operations, and certain other functions to now overseeing the whole Company as Interim CEO. Mr. Marks did not receive any additional compensation upon assuming the role of Interim CEO as his existing compensation was commensurate with his extensive leadership role and value to the Company as a sales visionary and customer relationship manager. Mr. Marks has an unparalleled amount of experience with the Company where he has served as a member of its leadership team since 2002. Our Board has commenced a search to identify a permanent CEO and has retained a leading executive search firm to assist in the process. It is anticipated that Mr. Marks will serve as Interim Chief Executive Officer until the election by the Board of a permanent CEO.

Detailed Discussion & Analysis

Compensation Philosophy

The primary goals of our Compensation Committee with respect to executive compensation are to:


•	review the competitiveness of executive cash compensation and equity grant levels compared to a select peer group of companies, using the 50th percentile as a reference point for setting compensation;


•	provide shorter-term cash incentives primarily for achieving specified annual performance objectives;


•	provide a mix of long-term equity incentives that are performance- and time-based to promote stock price growth, retention and ownership through achievement of long-term financial performance goals; and


•	establish and monitor appropriate pay and performance relationships.

To achieve these goals, we intend to maintain a compensation structure that provides rewards for high performance and value creation for our stockholders (including the founding members).

Role of Compensation Consultant and CEO in Determining Executive Compensation

In 2018, our former CEO had substantial input in the determination of executive compensation other than his own and made recommendations for the compensation of all of the other NEOs that were ultimately approved by our Compensation Committee in January of 2018. Our former CEO’s compensation was determined and approved by our Compensation Committee. Our former CEO was not present during voting or deliberations by our Compensation Committee regarding his compensation.

In 2018, our Compensation Committee engaged ClearBridge, a nationally recognized consulting firm, to serve as an independent consultant on executive compensation matters. ClearBridge assessed the competitiveness of pay for the executive officers and provided independent advice and recommendations to our Compensation Committee regarding executive compensation. Our Compensation Committee determined that ClearBridge is independent from the Company.

As part of its review, ClearBridge considered base salary, annual cash incentive, total cash compensation (combined salary and annual cash incentive), long-term incentives, and total direct compensation. ClearBridge reviewed and recommended a peer group for pay comparison for our executive officers comprised of companies that are publicly and domestically traded, of comparable size to NCM, Inc., and in relevant industries (i.e., in advertising, media and entertainment industries, or software technology-based companies in media-related industries). Our Compensation Committee reviewed and approved the peer group.

Our Compensation Committee believes that peer group comparisons are useful to measure the competitiveness of our compensation practices and uses the information provided by the compensation consultant as an input to its decision making. Although our Compensation Committee references the 50th percentile of the peer group’s pay levels, specific positioning for each NEO is determined on a case-by-case basis considering multiple factors.

The following peer companies were used in our competitive analysis for fiscal 2018 decisions:




Cumulus Media Inc.		MSG Networks Inc.
Entercom Communications Corp		The E.W. Scripps Company
Entravision Communications Corporation		TiVo Corporation
Emmis Communications Corporation		Townsquare Media, Inc.
Global Eagle Entertainment Inc.		Urban One, Inc. (formerly Radio One)
Gray Television, Inc.		Salem Media Group, Inc.
IMAX Corp.		WebMD Health Corp.
Lee Enterprises, Incorporated		World Wrestling Entertainment, Inc.

We eliminated three companies and added two from our 2017 peer group as a result of our Compensation Committee’s assessment of the group relative to industry and size criteria.

2018 Compensation

Provided below is a summary of the key elements of our 2018 compensation program for the NEOs.





Component	Description	Purpose
Base Salary	Fixed cash component	Reward for level of responsibility, experience and sustained individual performance
Annual Cash Incentive	Cash performance bonus based on achievement of pre-determined performance goals	Reward team achievement against specific objective financial goals
Long-Term Incentives	Equity grants in 2018 consisted of: •Performance-based restricted shares •Time-based restricted shares	Reward for the creation of stockholder value and retain executives for the long-term
Other Compensation	A matching contribution to our defined contribution 401(k) plan and various health, life and disability insurance plans; dividend equivalents accrued on restricted stock and other customary employee benefits.	Provide an appropriate level of employee benefit plans and programs
Potential Payments Upon Termination or Change in Control	Contingent in nature. Amounts are payable only if employment is terminated as specified under each employment agreement. Change of control payments require both a change of control and a separation from service. No excise tax gross-ups are provided.	Provide an appropriate level of payment in the event of a change in control or termination
Other Policies	Stock Ownership Guideline policy Clawback policy Insider trading policy, which includes anti-hedging and anti-pledging policies	Enhance alignment with stockholder interests

Specific compensation decisions made in 2018 are described below.

Base Salary. Base salaries for our executives were established based on the scope of their role and responsibilities, taking into account the experience and seniority of the individual, individual performance, peer salary levels, and other primarily subjective factors deemed relevant by our Compensation Committee.

Base salaries are reviewed annually by our Compensation Committee and our Board, and may be adjusted from time to time pursuant to such review and/or in accordance with guidelines contained in the various employment agreements.

The base salaries of our NEOs in 2018 compared to 2017 as of the end of the fiscal year were as follows.



Name	2017 Base Salary		2018 Base Salary		Percentage Change
Clifford E. Marks	$	858,330	$	875,497	2.0	%
Andrew J. England	$	875,000	$	875,000	—	%	(1)
Katherine L. Scherping	$	408,000	$	408,000	—	%
Scott D. Felenstein	$	500,000	$	506,667	1.3	%
Sarah Kinnick Hilty	N/A		$	310,000	N/A		(2)
Ralph E. Hardy	$	310,271	$	310,271	—	%	(1)

(1) Messrs. England and Hardy's 2018 salaries represent their salary prior to the termination of their employment.

(2) Ms. Hilty was hired in 2018, and as such did not have a 2017 base salary.

For 2018, we believe the above salaries were within a market competitive range compared to our competitors.

Annual Cash Incentive. Annual cash incentives are intended to compensate executives for achieving financial goals that support our annual operational and strategic goals.

The target percentages for our NEOs were established based on the responsibility, experience and seniority of the individual. We believe our annual cash incentives, in combination with base salaries, deliver competitive total cash

compensation. In addition, we believe rewarding our executives for achievement of our financial goals is consistent with the practice of aligning their interests with those of our stockholders. Payments of annual cash incentives are objectively calculated for each NEO based on the achievement of specific financial targets. The process for setting the financial targets for 2018 was consistent with previous years as part of the annual budget review and approval. For 2018, the annual cash incentive was based (i) 50% on achievement of Adjusted OIBDA for Compensation Purposes and (ii) 50% on Adjusted Advertising Revenue targets. The stretch bonus for achievement above 100% of the target bonus was also based on the equal weighting of the achievement of the aforementioned targets. For Fiscal 2018, no stretch bonuses were paid as 100% of the target was not achieved for the year. These performance measures are non-GAAP measures and are specifically defined in the “Definitions of Performance Measures Used in Incentive Plans for Fiscal 2018” section below.

Our annual cash incentive is paid in a single payment in the first quarter following the completion of a given fiscal year. Payments are subject to review, approval and certification by our Compensation Committee in conjunction with the issuance of our annual audit report.

The annual cash incentive potential which is based equally on Adjusted OIBDA for Compensation Purposes (defined in the “Definitions of Performance Measures Used in Incentive Plans for Fiscal 2018” below) and Adjusted Advertising Revenue (defined in “Definitions of Performance Measures Used in Incentive Plans for Fiscal 2018” below) is achieved as follows. Straight line interpolation is applied to performance between the levels shown.




Percentage of Adjusted OIBDA for Compensation Purposes and Adjusted Advertising Revenue Achieved		% of Target Bonus
Less than 85%		0%
85%		25%
90%		50%
95%		75%
100%		100%
≥105%		150%

Actual fiscal year 2018 performance results were as follows.



Fiscal 2018 Performance Measures (in millions) (1)
	Target		Actual		Achievement relative to target
Adjusted OIBDA for Compensation Purposes	$	180.3	$	176.9	98.1% of targeted Adjusted OIBDA for Compensation Purposes
Adjusted Advertising Revenue	$	411.9	$	406.6	98.7% of targeted Adjusted Advertising Revenue target


(1)	Adjusted OIBDA for Compensation Purposes and Adjusted Advertising Revenue are non-GAAP measures. See “Definitions of Performance Measures Used in Incentive Plans for Fiscal 2018” below for the definitions of Adjusted OIBDA for Compensation Purposes and Adjusted Advertising Revenue and the reconciliations to the closest GAAP basis measurement.

Resulting annual cash incentive payouts for fiscal year 2018 were as follows.

Fiscal 2018 Non-Equity Incentive Plan Payments

The awards were determined in accordance with the Company’s actual performance compared to our internal targets. We believe the executive performance bonus amounts are appropriate in light of the achievement relative to the financial targets. The following table provides details about each component of the “Non-Equity Incentive Plan Compensation” column of the Fiscal 2018 Summary Compensation Table for Messrs. Marks, England, and Felenstein and Mses. Scherping and Hilty.



	Annual Cash Incentive
		Adjusted OIBDA for Compensation Purposes (50% weighting)		Adjusted Advertising Revenue (50% weighting)		Total
Name	Target Award as a % of Salary (1)	Actual Achievement as a % of Target	Actual Award as a % of Target	Actual Achievement as a % of Target	Actual Award as a % of Target	Actual Award as a % of Target	Total Award Amount
Clifford E. Marks	100.0%	98.1%	90.6%	98.7%	93.6%	92.1%	$806,333
Andrew J. England (2)	84.6%	98.1%	90.6%	98.7%	93.6%	92.1%	$681,891
Katherine L. Scherping	75.0%	98.1%	90.6%	98.7%	93.6%	92.1%	$281,826
Scott D. Felenstein	75.0%	98.1%	90.6%	98.7%	93.6%	92.1%	$349,980
Sarah Kinnick Hilty (3)	50.0%	100.0%	100.0%	100.0%	100.0%	100.0%	$136,740


(1)	Percentage of base salary determined at the end of our 2018 fiscal year (December 27, 2018).


(2)	Under the terms of his employment agreement, Mr. England 's target award for his annual cash incentive was 100.0% of his annual salary. Upon his separation from service, this target was prorated for the portion of the service period he served as the Company's CEO, or 84.6%.


(3)	Pursuant to Ms. Hilty’s employment agreement, her annual cash incentive payment was to be paid in full, and prorated for her time of employment during the year.

Long-Term Incentives (LTI). We believe that creating long-term value for our stockholders is achieved, in part, by aligning the interests of our executive officers with those of our stockholders. We have granted awards under our stockholder approved equity incentive plans, the National CineMedia, Inc. 2007 Equity Incentive Plan as amended and restated and the National CineMedia, Inc. 2016 Equity Incentive Plan, which together we refer to as the “Equity Incentive Plan.” Stockholders approved the National CineMedia, Inc. 2016 Equity Incentive Plan in May 2016 because the National CineMedia, Inc. 2007 Equity Incentive Plan was set to expire, and has expired, by its terms in February 2017.

All grants under the Equity Incentive Plan to our executive officers are approved by our Compensation Committee generally at its first meeting of the fiscal year, although grants could be made at any time at the discretion of our Compensation Committee, generally related to promotions or other merit-related reasons.

For 2018, the Compensation Committee decided to continue to grant the following LTI vehicles:


•	PBRS: Aligns executives with the long-term financial goals of the Company. PBRS vest based upon the achievement of cumulative 2018-2020 “Free Cash Flow”, as defined within the ‘“Definitions of Performance Measures Used in Incentive Plans for Fiscal 2018” and 2020 “Digital Revenue” goals, as defined below.


•	TBRS: Promotes retention objectives, stock ownership in the Company, and an alignment of the executives’ interests with stockholders’ interests. TBRS vest ratably over a 3-year period.

On January 23, 2018, our Compensation Committee approved PBRS and TBRS to Messrs. Marks, England, and Felenstein and Mses. Scherping and Hilty (effective upon commencement of her employment), as follows.



	2018 Restricted Stock Awards (1)
	PBRS					TBRS					Total
Name	% of Total LTI (2)		Target Grant Date Fair Value of Shares Granted (3)		Target Number of Shares Granted (3)	% of Total LTI		Grant Date Fair Value of Shares Granted		Number of Shares Granted (4)	Total Grant Date Fair Value of Shares Granted		Total Number of Target Shares Granted
Clifford E. Marks	60	%	$	631,567	95,692	40	%	$	421,047	63,795	$	1,052,614	159,487
Andrew J. England	75	%	$	1,125,003	170,455	25	%	$	374,999	56,818	$	1,500,002	227,273
Scott D. Felenstein	50	%	$	198,000	30,000	50	%	$	198,000	30,000	$	396,000	60,000
Katherine L. Scherping	60	%	$	191,044	28,946	40	%	$	127,360	19,297	$	318,404	48,243
Sarah Kinnick Hilty (5)	18	%	$	51,314	7,426	82	%	$	230,338	33,334	$	281,652	40,760


(1)	The performance-based and time-based restricted stock awards include the right to receive dividend equivalents, subject to vesting.


(2)	Mr. Marks and Ms. Scherping received 60% PBRS and 40% TBRS due to their positions at the time of grant as a Named Executive Officer. Mr. Felenstein received 50% PBRS and 50% TBRS due to his position at the time of grant as an Executive Vice President. Mr. England received 75% PBRS and 25% TBRS due to his position at the time of grant of Chief Executive Officer.

(3)

Performance-based restricted stock awards vest in March 2021 based on (a) 75% on the achievement of cumulative 2018-2020 “Free Cash Flow” goals and (b) 25% on the achievement of 2020 “Digital Revenue” goals (defined as revenue derived from advertising sold online, through mobile devices and other digital platforms). Reflects the target number of shares that will vest if actual cumulative Free Cash Flow and Digital Revenue equals 100% of the targets. Straight line interpolation is applied to performance between the levels shown.




Free Cash Flow -% of Target		Award Vesting % of Target Shares
<85%		0%
85%		25%
90%		50%
95%		75%
100%		100%
≥105%		150%




Digital Revenue -% of Target		Award Vesting % of Target Shares
<36.2%		0%
36.2%		25%
100%		100%
≥163.8%		200%


(4)	Vest ratably over a 3-year period.


(5)	Ms. Hilty received a sign-on grant at her hire date of 11,056 shares of TBRS, based upon a value of $75,000, using a 30-day average stock price, and an annual grant of 7,426 or 25% PBRS and 22,278 or 75% TBRS consistent with her position at the time of grant of Senior Vice President. The value above reflected the value using the stock price at the date of grant.

Results for Performance-Based Restricted Stock with Measurement Periods Ended December 27, 2018. The performance-based restricted stock granted on January 20, 2016 (“2016 PBRS”) were scheduled to vest based upon achievement of the actual cumulative “Free Cash Flow” target at the end of the three-year measurement period ending December 27, 2018. The 2016 PBRS vests according to the scale shown below. Straight line interpolation is applied to Free Cash Flow performance between the levels shown to determine the corresponding payout.




Free Cash Flow -% of Target		Award Vesting % of Target Shares
<80%		0%
80%		25%
95%		90%
100%		100%
≥110%		150%

On all PBRS, dividends accrue and are paid upon vesting for those shares earned. In the event that shares are not earned, accrued dividends on those shares are not paid.

The PBRS vested as shown below.



Performance Measure (in millions)	Target	Actual	Achievement Relative to Target	Vesting %
2016 PBRS cumulative Free Cash Flow (a)	$642.0	$517.7	80.6%	27.7%


(a)	“Free Cash Flow” is a non-GAAP measure. See “Definitions of Performance Measures Used in Incentive Plans for Fiscal 2018” below for the definition of Free Cash Flow and the reconciliations to the closest GAAP basis measurement.

The following table shows the number of shares vested and accrued dividends paid to our NEOs for the performance-based restricted stock with the measurement period ended December 27, 2018.



Name	Number of Shares Awarded on January 20, 2016	Total Vesting on February 25, 2019	Accrued Dividends (1)
Clifford E. Marks	92,503	25,623	$	62,521
Andrew J. England (2)	74,950	18,652	$	45,511
Ralph E. Hardy (2)	21,279	4,015	$	9,796


(1)	As a result of the level of achievement of the awards which vested on February 25, 2019, accrued dividends were paid in March 2019.


(2)	Mr. England and Mr. Hardy's employment ended prior to the vesting date and thus 7,614 and 6,786 of their awarded shares were forfeited upon separation from service and 48,684 and 10,478 were forfeited due to the Company's performance, respectively.

Stockholder Say-on-Pay Vote

In establishing and recommending 2019 compensation for the Company’s NEOs, our Compensation Committee considered the results of the say-on-pay vote at the 2018 Annual Meeting of Stockholders. At that meeting, our stockholders approved our executive compensation for the 2018 fiscal year with approximately 98% of the votes cast in favor. Our Board of Directors recognizes that executive compensation is an important matter of stockholder concern and takes stockholder views into account through the say-on-pay vote when reviewing the compensation program throughout the year. Our Compensation Committee considered the results of the advisory approval and as such, generally maintained the overall composition of executive compensation for the 2019 fiscal year.

Other Compensation. Our employees, including our NEOs, participate in various employee benefits. These benefits include the following: medical and dental insurance; flexible spending accounts for healthcare; life, accidental death and dismemberment and disability insurance; employee assistance programs (confidential counseling); a 401(k) plan; and paid time off.

None of our NEOs participate in or have account balances in qualified or non-qualified defined benefit plans sponsored by us or in non-qualified defined contribution plans or other deferred compensation plans maintained by us. Our Compensation Committee may elect to provide our officers and other employees with non-qualified defined contribution or deferred compensation benefits if our Compensation Committee determines that doing so is in our best interests.

Potential Payments upon Termination or Change in Control. Upon certain types of terminations of employment, payments may be made to our executive officers in accordance with their respective employment agreements. These events and potential amounts are further described below under the heading “Potential Payments Upon Termination or Change in Control.”

Definitions of Performance Measures Used in Incentive Plans for Fiscal 2018. Presented below are definitions of performance measures used in incentive plans. Our Compensation Committee may apply pre-determined adjustments to the definitions of the financial performance criteria under the plans.

Adjusted OIBDA for Compensation Purposes

Adjusted OIBDA for Compensation Purposes used to measure achievement against performance bonus targets is a non-GAAP financial measure that differs from Adjusted OIBDA as defined in our Form 10-K. Adjusted OIBDA is a key metric used by management to measure the Company’s operating performance. OIBDA represents operating income plus depreciation and amortization expense. Adjusted OIBDA for Compensation Purposes subtracts out the revenue from advertising by NCM LLC’s founding members’ beverage supplier and barter revenue, net of barter expense, and adds back share-based compensation costs, CEO transition costs, fees incurred related to the negotiation of the settlement agreement with a large stockholder and the change in the make-good liability during 2018. The addition of the adjustment related to the negotiation of the settlement agreement was approved by the Compensation Committee in October 2018. While Adjusted OIBDA for Compensation Purposes is a measure used to calculate our Executive Performance Bonus awards, this non-GAAP measure should not be considered in isolation of, or as a substitute for, measures of our financial performance as determined in

accordance with GAAP, such as operating income. Adjusted OIBDA for Compensation Purposes has material limitations as a performance measure because it excludes items that are necessary elements of our costs and operations. Because other companies may calculate Adjusted OIBDA for Compensation Purposes differently than we do, this measure may not be comparable to similarly-titled measures reported by other companies. The following table reconciles operating income to Adjusted OIBDA for Compensation Purposes (dollars in millions).



	FY 2018 Target			FY 2018 Actual
Operating income	$	161.3		$	154.3
Plus: Depreciation and amortization	38.7			39.9
OIBDA	200.0			194.2
Less: Founding member circuit beverage revenue	(29.1		)	(31.4		)
Plus: Share-based compensation costs	10.0			7.8
Plus: CEO transition costs	—			3.4
Plus: Fees incurred related to the settlement agreement with a large stockholder	—			1.4
Plus: Change in the make-good liability	(2.0		)	2.4
Less: Barter revenue, net of barter expense	1.4			(0.9		)
Adjusted OIBDA for compensation purposes	$	180.3		$	176.9

Adjusted Advertising Revenue

Adjusted Advertising Revenue used to determine achievement against performance bonus targets is a non-GAAP financial measure. Adjusted Advertising Revenue represents reported advertising revenue less founding member circuit beverage revenue and zero margin barter revenue, plus the change in the make-good liability during 2018. This non-GAAP measure should not be considered in isolation of, or as a substitute for, measures of our financial performance as determined in accordance with GAAP, such as advertising revenue. The following table reconciles advertising revenue to Adjusted Advertising Revenue (dollars in millions).



	FY 2018 Target			FY 2018 Actual
Advertising revenue	$	443.0		$	441.4
Less: Founding member circuit beverage revenue	(29.1		)	(31.4		)
Less: Barter revenue	—			(5.8		)
Plus: Change in the make-good liability	(2.0		)	2.4
Adjusted Advertising Revenue	$	411.9		$	406.6

Free Cash Flow

Free Cash Flow is a non-GAAP measure used by management to measure the Company’s operating cash flow in determining whether PBRS targets have been achieved. Free Cash Flow represents Adjusted OIBDA for Compensation Purposes, described above, less capital expenditures. The following table reconciles operating income to Free Cash Flow (dollars in millions).



	2016-2018 3- Year Cumulative Ended December 27, 2018
	Target			Actual
Operating income	$	600.7		$	481.2
Plus: Depreciation and amortization	114.6			113.3
OIBDA	715.3			594.5
Less: Founding member circuit beverage revenue	(90.2		)	(90.0		)
Plus: Share-based compensation costs	56.1			37.2
Plus: CEO transition costs	3.0			7.6
Plus: Fees incurred related to the settlement agreement with a large stockholder	—			1.4
Plus: Early lease termination expense	—			1.8
Plus: Change in the make-good liability	—			4.6
Less: Barter revenue, net of barter expense	—			(0.4		)
Plus: Restructuring expense	—			0.9
Less: Capital expenditures	(42.2		)	(39.9		)
Free Cash Flow – Actual	$	642.0		$	517.7

Other Policies

Adoption of Share Ownership Guidelines

The Company adopted the following share ownership guidelines for its executive officers and directors in January 2013:




Position		Minimum Share Ownership Level
Chief Executive Officer and Director		Lesser of three times base salary or 140,000 shares
President and Executive Vice Presidents		Lesser of base salary or 20,000 shares
Non-Employee Directors		Lesser of three times annual Board cash retainer or 8,000 shares

Each individual is expected to attain the minimum ownership level within five years of the effective date of the policy, or the individual’s date of appointment, if later. If the minimum ownership level is not attained within the required timeframe, holding restrictions will apply. Upon vesting of equity awards, 50% of the individual’s shares that become vested will be subject to holding restrictions until the minimum ownership level is attained. Ownership levels are determined based on Company common stock owned by each individual, including shares of unvested timed-based restricted stock and in-the-money vested stock options. As of March 4, 2019, all executive officers and directors meeting the tenure requirement were in compliance with the share ownership guidelines.

Anti-Hedging Policy

The Company’s insider trading policy includes provisions that prohibit all employees and directors from entering into hedging transactions with respect to Company stock.

Anti-Pledging Policy

The Company’s insider trading policy includes provisions that prohibit all employees and directors from keeping Company stock in a margin account or using Company stock as collateral for a loan. To our knowledge, none of our officers or directors has pledged any of his or her shares in violation of Company policy.

Clawback Policy

We have adopted a “clawback” policy addressing the adjustment or recovery of awards or payments if the relevant performance measures upon which they are based are restated or otherwise adjusted in a manner that would reduce the size of an award or payment. This policy, also known as a “clawback” policy, applies to all of our executive officers, including the NEOs. Under the policy, we may recover any incentive compensation paid to an executive officer of the Company in the event of a material negative accounting restatement of our financial statements due to material noncompliance by the Company with any financial reporting requirement under the securities laws. If our Board of Directors determines that any current or former executive officer has engaged in fraud or intentional misconduct that caused the error that, directly or indirectly, resulted in the

financial restatement, our Board of Directors may require reimbursement or forfeiture of any annual or long-term cash bonus or any equity compensation award earned with respect to the period covered by the restatement by such executive officer.

COMPENSATION COMMITTEE REPORT

The Compensation Committee has reviewed and discussed the “Compensation Discussion and Analysis” included elsewhere in this report with management and, based on such review and discussions, the Compensation Committee recommended that the Board of Directors include such disclosure for the fiscal year ended December 27, 2018 in NCM, Inc.’s Annual Report on Form 10-K and proxy statement filed with the SEC.




		Compensation Committee of National CineMedia, Inc.
		Mark B. Segall, Chairman
		Andrew P. Glaze
		Lawrence A. Goodman
		David R. Haas

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

We do not have any interlocking relationships between any member of our Compensation Committee and any of our executive officers that would require disclosure under the applicable rules promulgated under the U.S. federal securities laws.

EXECUTIVE COMPENSATION TABLES

FISCAL 2018 SUMMARY COMPENSATION TABLE

The following table shows the amount of compensation earned by our NEOs during the years indicated. For additional information regarding the material terms of each NEOs’ employment agreement, see “Employment Agreements” and “Potential Payments Upon Termination or Change in Control” below.




Name and Principal Position	Year	Salary		Bonus (1)		Stock Awards (2)		Non-Equity Incentive Plan Compensation (3)		All Other Compensation (4)		Total
Clifford E. Marks (5) Interim Chief Executive Officer and President	2018 2017 2016	$ $ $	875,497 858,330 841,500	$ $ $	— — —	$ $ $	1,052,614 2,360,408 2,314,122	$ $ $	806,333 503,196 741,041	$ $ $	28,509 12,331 6,236	$ $ $	2,762,953 3,734,265 3,902,899
Andrew J. England (6) Former Chief Executive Officer	2018 2017 2016	$ $ $	827,885 875,000 750,000	$ $ $	— — —	$ $ $	1,500,002 1,500,000 2,255,787	$ $ $	681,891 512,969 660,464	$ $ $	2,726,639 85,823 88,591	$ $ $	5,736,417 2,973,792 3,754,842
Katherine L. Scherping Chief Financial Officer	2018 2017 2016	$ $ $	408,000 408,000 160,000	$ $ $	— — —	$ $ $	318,404 714,000 396,843	$ $ $	281,826 179,393 116,393	$ $ $	14,946 10,748 4,049	$ $ $	1,023,176 1,312,141 677,285
Scott D. Felenstein (7) Chief Revenue Officer	2018	$	506,667	$	—	$	396,000	$	349,980	$	8,650	$	1,261,297
Sarah Kinnick Hilty (8) SVP and General Counsel	2018	$	310,000	$	25,000	$	281,652	$	136,740	$	2,378	$	755,770
Ralph E. Hardy (9) Former EVP and General Counsel	2018 2017 2016	$ $ $	95,468 310,271 304,187	$ $ $	— — —	$ $ $	— 542,968 532,330	$ $ $	— 136,422 200,905	$ $ $	349,041 11,647 7,098	$ $ $	444,509 1,001,308 1,044,520


(1)	This amount represents a one time sign on bonus of $25,000 made pursuant to her Employment Agreement within 30 days after the commencement of her employment on February 12, 2018.

(2)

The amounts represent the aggregate grant date fair value of the target level of stock awards computed in accordance with ASC Topic 718. For a discussion of the assumptions and methodologies used in calculating the grant date fair value of these awards, please see Note 11 to the Company’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 27, 2018, filed on February 22, 2019. Certain of the stock awards granted in 2018, 2017 and 2016 are scheduled to vest based upon the achievement of performance conditions relating to cumulative “Free Cash Flow”, “2019 Digital Revenue” (for the 2017 awards only) and "2020 Digital Revenue" (for the 2018 awards only) at the end of the three-year measuring period. The amounts for these awards are presented based on 100% of the fair market value on the date of grant and do not include an estimate of performance. Actual results could materially differ from this estimate. Stock awards are further discussed in the “Long-Term Incentives” section of our CD&A. The table below includes the maximum amounts payable for awards granted during fiscal 2018 assuming the highest level of performance is achieved:




Stock Awards
Name	Grant Date	Maximum Number of Shares Scheduled to Vest	Maximum Grant Date Fair Value (a)
Clifford E. Marks	1/24/2018	219,295	$	1,447,344
Andrew J. England (b)	1/24/2018	276,989	$	1,828,130
Katherine L. Scherping	1/24/2018	66,334	$	437,806
Scott D. Felenstein	1/24/2018	78,750	$	519,750
Sarah Kinnick Hilty	2/12/2018	45,401	$	313,723
Ralph E. Hardy	—	—	$	—


(a)	The amount is based on the maximum number of shares as of the grant date subject to the award assuming the highest level of performance is achieved (162.5% for 2018 grants) for the performance-based restricted stock grants. The time-based restricted stock grants are included at 100%. The amounts for these awards are presented based upon the fair market value on the date of grant.


(b)	The amount listed as scheduled to vest represents Mr. England's shares prior to his termination on November, 2, 2018. Following his separation from service, 207,987 of the shares were forfeited.


(3)	Our Compensation Committee approved fiscal 2018 performance bonuses for the NEOs on February 19, 2019, and the bonuses were paid on February 26, 2019. See further discussion in the “Annual Cash Incentive” section of our CD&A.


(4)	The following table provides details about each component of the “All Other Compensation” column from the Fiscal 2018 Summary Compensation Table above for fiscal 2018.



Name	Year	401(k) Employer Contribution (a)		Term Life Insurance (b)		Disability Insurance (c)		Misc.			Total All Other Compensation
Clifford E. Marks	2018	$	4,981	$	3,334	$	925	$	19,269	(d)	$	28,509
Andrew J. England	2018	$	6,600	$	1,635	$	851	$	2,717,553	(d,e)	$	2,726,639
Katherine L. Scherping	2018	$	6,600	$	1,705	$	925	$	5,716	(d)	$	14,946
Scott D. Felenstein	2018	$	6,600	$	1,162	$	888	$	—		$	8,650
Sarah Kinnick Hilty	2018	$	1,443	$	306	$	629	$	—		$	2,378
Ralph E. Hardy	2018	$	2,291	$	763	$	185	$	345,802	(f)	$	349,041


(a)	Represents matching contributions made pursuant to NCM LLC’s defined contribution 401(k) plan. Eligible employees, including the NEOs, are eligible for a discretionary contribution under the 401(k) plan on base pay up to IRS limits.


(b)	Represents imputed income for term life insurance coverage.


(c)	Represents imputed income for long-term and short-term disability insurance coverage.


(d)	Represents business-related awards, gifts and prizes and taxable fringe benefits for Messrs. Marks and England and Ms. Scherping. The majority of these expenses, $17,101, $15,229, and $5,716, respectively, relate to airline club membership dues.

(e)

Includes the following payments made pursuant to Mr. England's Separation Agreement: (1) a lump-sum severance payment of $2,625,000 made on January 2, 2019, (2) $53,356 to be paid ratably over the eighteen months following Mr. England's separation from service for COBRA coverage under the Company's group health and dental plans, grossed up by 50% to take into account additional taxes that would be owed by Mr. England and (3) $23,278 for reimbursement of Mr. England's legal expenses incurred in conjunction with the negotiation of his Separation Agreement made on December 5, 2018.

(f)

Includes $310,271 made pursuant to his Separation, General Release and Consulting Agreement ratably over 2018 following Mr. Hardy’s termination of employment on March 1, 2018 and a lump-sum payment of $35,531 made pursuant to Mr. Hardy’s Separation, General Release and Consulting Agreement, for the pre-tax amount the Company would have paid to the providers of medical, health and life insurance plans for 12-months of Mr. Hardy’s coverage thereunder, grossed up by 35% to take into account additional taxes that would be owed by Mr. Hardy.


(5)	Mr. Marks was appointed the Interim Chief Executive Officer and President by the Board effective November 2018, before which time Mr. Marks served as President of the Company since 2016 and a member of the Company's leadership team since 2002. Mr. Marks did not receive any additional compensation upon assuming the role of Interim CEO.


(6)	Mr. England was employed through November 2018.


(7)	Mr. Felenstein has been employed since April 2017 and was named an executive officer of the Company in March 2018.


(8)	Ms. Hilty has been employed since February 2018.


(9)	Mr. Hardy was employed through March 2018.

FISCAL 2018 GRANTS OF PLAN-BASED AWARDS

The following table shows the awards granted to our NEOs for our 2018 fiscal year.




		Estimated Future Payouts Under Non-Equity Incentive Plan Awards (1)			Estimated Future Payouts Under Equity Incentive Plan Awards (2)			All Other Stock Awards: Number of Shares of Stock (#)	Grant Date Fair Value of Stock Awards ($)(3)
Name	Grant Date	Threshold ($)	Target ($)	Maximum ($)	Threshold (#)	Target (#)	Maximum (#)
Clifford E. Marks	N/A 1/24/2018 1/24/2018	218,874 — —	875,497 — —	1,313,246 — —	— 23,923 —	— 95,692 —	— 155,500 —	— — 63,795	$ $	— 631,567 421,047
Andrew J. England	N/A 1/24/2018 1/24/2018	218,750 — —	875,000 — —	1,312,500 — —	— 42,614 —	— 170,455 —	— 276,989 —	— — 56,818	$ $	— 1,125,003 374,999
Katherine L. Scherping	N/A 1/24/2018 1/24/2018	76,500 — —	306,000 — —	459,000 — —	— 7,237 —	— 28,946 —	— 47,037 —	— — 19,297	$ $	— 191,044 127,360
Scott D. Felenstein	N/A 1/24/2018 1/24/2018	95,000 — —	380,000 — —	570,000 — —	— 7,500 —	— 30,000 —	— 48,750 —	— — 30,000	$ $	— 198,000 198,000
Sarah Kinnick Hilty	N/A 2/12/2018 2/12/2018	38,750 — —	155,000 — —	232,500 — —	— 1,857 —	— 7,426 —	— 12,067 —	— — 33,334	$ $	— 51,314 230,338
Ralph E. Hardy	—	—	—	—	—	—	—	—		—


(1)	Amounts represent potential cash bonus amounts if targets are achieved for 2018 performance for each NEO. See “Non-Equity Incentive Plan Compensation” in our Summary Compensation Table for amounts paid.


(2)	Represents performance-based restricted stock grants made in 2018 under the Equity Incentive Plan. The restricted stock awards provide that the award will accrue dividends payable subject to vesting. For additional information regarding equity awards see “Long-Term Incentives” in the CD&A and “Equity Incentive Plan Information.”

(3)

Grant date fair value of stock awards was calculated in accordance with GAAP. Some of the 2018 restricted stock awards are scheduled to vest based upon achievement of the actual cumulative “Free Cash Flow” and “2020 Digital Revenue” targets at the end of the three-year measuring period and are presented in the table based on target amounts. Refer to footnote (2) to our Summary Compensation Table for the maximum number of shares that could be awarded.

Non-Equity Incentive Plan Awards

Refer to our Summary Compensation Table for the actual payouts for fiscal 2018. Additional information about these awards and our actual performance is included in our CD&A, “Annual Cash Incentive.”

Equity Incentive Plan Awards

During fiscal 2018, each of our active NEOs received awards under our Equity Incentive Plan. Additional information about the awards is included in our CD&A, “Long-Term Incentives.”

OUTSTANDING EQUITY AWARDS AT DECEMBER 27, 2018



	Stock Option Awards					Restricted Stock Awards
Name	Number of Securities Underlying Unexercised Options Exercisable	Number of Securities Underlying Unexercised Options Unexercisable	Option Exercise Price		Option Expiration Date (1)	Number of Shares of Stock That Have Not Vested		Market Value of Shares of Stock That Have Not Vested (2)		Equity Incentive Plan Award: Number of Unearned Shares That Have Not Vested (3)	Equity Incentive Plan Award: Market or Payout Value of Unearned Shares That Have Not Vested (2)
Clifford E. Marks	182,964	—	$	17.79	1/13/2021	—		—		—	—
	38,543	—	$	23.28	9/7/2021	—		—		—	—
	40,659	—	$	12.73	1/12/2022	—		—		—	—
	—	—	—		—	—		—		92,503	$	582,769
	—	—	—		—	20,557	(4)	$	129,509	—	—
	—	—	—		—	—		—		95,692	$	602,860
	—	—	—		—	42,530	(5)	$	267,939	—	—
	—	—	—		—	—		—		95,692	$	602,860
	—	—	—		—	63,795	(6)	$	401,909	—	—
Andrew J. England	—	—	—		—	—		—		67,336	$	424,217
	—	—	—		—	—		—		43,820	$	276,066
	—	—	—		—	—		—		42,463	$	267,517
Katherine L. Scherping	—	—	—		—	8,485	(7)	$	53,456	—	—
	—	—	—		—	—		—		28,946	$	182,360
	—	—	—		—	12,865	(6)	$	81,050	—	—
	—	—	—		—	—		—		28,946	$	182,360
	—	—	—		—	19,297	(5)	$	121,571	—	—
Scott D. Felenstein	—	—	—		—	—		—		20,887	$	131,588
	—	—	—		—	23,208	(8)	$	146,210	—	—
	—	—	—		—	—		—		30,000	$	189,000
	—	—	—		—	30,000	(6)	$	189,000	—	—
Sarah Kinnick Hilty	—	—	—		—	—		—		7,426	$	46,784
	—	—	—		—	33,334	(9)	$	210,004	—	—
Ralph E. Hardy	22,143	—	$	8.93	2/29/2020	—		—		—	—
	19,745	—	$	17.79	2/29/2020	—		—		—	—
	13,163	—	$	12.73	2/29/2020	—		—		—	—
	—	—	—		—	—		—		14,493	$	91,306
	—	—	—		—	—		—		7,902	$	49,783


(1)	Options generally expire 90 days from the term date if the NEO terminates employment. Pursuant to Mr. Hardy’s Separation, General Release and Consulting Agreement, his outstanding stock options expire at the end of his two-year consulting term, February 29, 2020, if he performs consulting services under the agreement.


(2)	Amounts are based on the closing stock price, $6.30 per share, on December 27, 2018 based on the target level of performance.


(3)	The restricted stock awards are scheduled to vest based on achievement of the actual cumulative “Free Cash Flow” target at the end of the three-year measuring period for the 2016 grants and a combination of the actual cumulative "Free Cash Flow" and "Digital Revenue" for the 2017 and 2018 grants. Refer to CD&A for discussion of cumulative Free Cash Flow and Digital Revenue.


(4)	The restricted stock vests 33.33% per year commencing on January 20, 2017, subject to continuous service.


(5)	The restricted stock vests 33.33% per year commencing on January 19, 2018, subject to continuous service.


(6)	The restricted stock vests 33.33% per year commencing on January 24, 2019, subject to continuous service.


(7)	The restricted stock vests 33.33% per year commencing on August 11, 2017, subject to continuous service.


(8)	The restricted stock vests 33.33% per year commencing on April 24, 2018, subject to continuous service.


(9)	The restricted stock vests 33.33% per year commencing on February 12, 2019, subject to continuous service.

See “Long-Term Incentives” in the CD&A for additional information.

STOCK VESTED DURING FISCAL 2018

The following table shows information regarding the vesting during fiscal 2018 of restricted stock awards previously granted to our NEOs. No options were exercised by any NEOs during fiscal 2018.



	Stock Awards
Name	Number of Shares Acquired on Vesting	Value Realized on Vesting (1)
Clifford E. Marks	144,177	$	1,038,864
Andrew J. England	95,969	$	763,843
Katherine L. Scherping	14,917	$	115,674
Scott D. Felenstein	11,604	$	66,723
Sarah Kinnick Hilty	—	—
Ralph E. Hardy	45,888	$	334,794


(1)	Amounts are based on the closing stock price on the date realized.

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL

The following summaries set forth potential payments payable to our NEOs upon termination of their employment or a change in control of NCM, Inc. under their employment agreements, as amended, and under the Equity Incentive Plan. The following discussion is based on the assumption that the actual bonus amount would be the target amount reported as a non-equity incentive plan award in the Grants of Plan Based Awards table. Actual payments may be more or less than the amounts described below. In addition, the Company may enter into new arrangements or modify these arrangements, from time to time. Each employment agreement provides definitions for the termination reasons. Descriptions of the separation arrangements for Messrs. England and Hardy are discussed below under “Employment Agreements.”

The following table assumes the executive’s employment was terminated under each of these circumstances on December 27, 2018 and such payments and benefits have an estimated value of:



	Cash Severance (1) (2)		Medical Insurance (3)		Term Life Insurance (3)		Disability Insurance (3)		401(k) Employer Contribution (3)		Value of Accelerated Equity Awards (4)		Total
Clifford E. Marks (a)
Without Cause or For Good Reason or Expiration of Agreement	$	1,378,693	$	22,043	$	3,334	$	925	$	4,981	$	1,677,866	$	3,087,842
Without Cause or For Good Reason 3 months prior or one year following a Change of Control	—		—		—		—		—		$	2,587,845	$	2,587,845
Death	—		$	22,043	—		—		—		$	1,677,866	$	1,699,909
Disability*	$	437,749	$	22,043	$	3,334	$	925	—		$	1,677,866	$	2,141,917
Katherine L. Scherping (b)
Without Cause or For Good Reason or Expiration of Agreement	$	714,000	$	20,124	—		—		—		$	355,730	$	1,089,854
Without Cause or For Good Reason one year following a Change of Control	$	714,000	$	20,124	—		—		—		$	620,796	$	1,354,920
Death	—		$	20,124	—		—		—		$	355,730	$	375,854
Disability*	$	204,000	$	20,124	1,705		629		—		$	355,730	$	582,188
Scott D. Felenstein (b)
Without Cause or For Good Reason or Expiration of Agreement	$