Document:

Exhibit 10.55

 

INDEPENDENT CONTRACTOR AGREEMENT

 

This Agreement is entered into on March
21, 2019, between Drone Aviation Holding Corp. (dba Drone Aviation Corp. and Lighter Than Air Systems) (“the Company”),
a Nevada corporation located at 11651 Central Parkway #118, Jacksonville FL 32224 and Cognitive Carbon Corporation (“the
Contractor”), a Florida corporation located at 916 Fiddlers Creek Rd. Ponte Vedra Beach, FL.

 

		1.	Independent Contractor. Subject
to the terms and conditions of this Agreement, effective March 31, 2019, the Company hereby engages the Contractor and its employees
as an independent contractor to perform the services set forth on exhibits attached hereto (the “Services”), and the
Contractor hereby accepts such engagement. Contractor’s provision of the Services under this Agreement will be of high quality
consistent with best industry practices and at all times satisfactory to the Company in its discretion. 

 

		2.	Duties, Term, and Compensation.
The Contractor’s duties, term of engagement, compensation and provisions for payment thereof shall be as set forth in Exhibits
A, B and C, which may be amended in writing from time to time and which collectively are hereby incorporated by reference. The
Agreement must be in full force and effect to receive earned compensation. Contractor will not receive any insurance, retirement,
or other such employment-related financial benefits from Company. 

 

		3.	Expenses. During the term of this
Agreement, Company will reimburse Contractor for reasonable and necessary out-of-pocket expenses incurred by Contractor in completing
the Services. Travel, lodging and transportation expenses will be reimbursed pursuant to the Company’s current Travel Expense
Policy, as amended from time to time. Company will reimburse Contractor promptly after Contractor submits a monthly expense report
and relevant receipts to Company. Notwithstanding the forgoing, Company reserves the right at any time, in its sole discretion,
to require Contractor to obtain the prior written approval of the Company for any (or all) expenditures for which Contractor plans
to request reimbursement. 

 

		4.	Confidentiality. The Contractor
acknowledges that during the engagement they may have access to and become acquainted with various trade secrets, inventions, innovations,
processes, information, records and specifications owned or licensed by the Company and/or used by the Company in connection with
the operation of its business including, without limitation, the Company’s business and product processes, methods, customer
lists, accounts and procedures. The Contractor agrees that they will not disclose any of the aforesaid, directly or indirectly,
or use any of them in any manner, either during the term of this Agreement or at any time thereafter, except as required in the
course of this engagement with the Company. All files, records, documents, blueprints, specifications, information, letters, notes,
media lists, original artwork/creative, notebooks, and similar items relating to the business of the Company, whether prepared
by the Contractor or otherwise coming into his possession, shall remain the exclusive property of the Company. The Contractor shall
not retain any copies of the foregoing without the Company’s prior written permission. Contractor acknowledges that by the
nature of its relationship with Company and pursuant to this Agreement, Contractor will have access to and will have knowledge
of material non-public information related to Company as such term is defined by the Securities Act of 1933, as amended. Contractor
hereby agrees and covenants that it will not make any purchases, sales or other transactions in the securities of Company based
on any material non-public information. This obligation shall survive the termination of this Agreement.

 

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		5.	Agreement Not to Compete. During
the term of this Agreement, and for one (1) year afterward, Contractor will not compete with the business of the Company or its
successors and assigns. Contractor will not directly or indirectly, as an owner, officer, director, employee, independent contractor,
Contractor, representative, or in any other capacity, engage in activities competitive to the Company in the business of RC Lighter-than-air
ships, Aerial Photography Systems, Aerial Surveillance Systems, Mast surveillance systems, and Tethered Aerial Platforms/Drones
or in a business substantially similar to the present business of the Company, or such other business activity in which the Company
may substantially engage while contracted by the Company.

 

In particular, Contractor will
not:

 

a) solicit or attempt to solicit
any business or trade from the Company’s actual or prospective customers or clients on behalf of himself or any other person,
firm, partnership, corporation or other entity competitive to the Company;

 

b) solicit or attempt to solicit
any existing Company employee for the purpose of said employee leaving the Company’s employment and working for any customer
or competitor; or

 

c) induce or encourage any independent
contractor or Contractor performing services for the Company to sever his or her relationship with the Company.

 

Contractor acknowledges that
the Company may notify Contractor’s future or prospective employers or any third party of the existence of this agreement.
Contractor acknowledges and agrees that the restrictions imposed by this agreement are fair and reasonably required for the protection
of the Company and will not preclude Contractor from becoming gainfully employed following the termination, for any reason, of
its engagement with the Company.

 

		6.	Work for Hire

 

Contractor agrees that Company
shall be the sole owner of all Work Product (as defined below) as a “work for hire” under this Agreement. For this
purpose, “Work Product” shall mean all intellectual property rights, including all trade secrets, U.S. and international
copyrights, patentable inventions, improvements, discoveries, and other intellectual property rights in any programming, documentation,
technology, or other Work Product that is created in connection with its Work. “Work” shall mean (i) any direct assignments
and required performance by or for Company, and (ii) any other productive output that relates to the business of Company and is
produced during Contractor’s employment or engagement by Company. For this purpose, “Work” may be considered
present even after normal working hours, away from Company’s premises, on an unsupervised basis, alone or with others.

 

To the extent that applicable
law does not permit ownership of any particular Work Product to be automatically transferred to Company, Contractor shall and hereby
does assign, convey and otherwise transfer to Company, without any requirement of consideration, all right, title and interest
Contractor may have in and to such Work Product and to the exploitation of such Work Product in media now known or hereafter created.
Upon request of Company, Contractor shall take such further actions, including execution and delivery of any documents, as may
be necessary or appropriate to give full and proper effect to such assignment. Contractor agrees, at the Company’s cost and
expense, to assign any inventions or discoveries to the Company and to cooperate with the Company in obtaining suitable patent
and/or trademark protection which will be solely owned by the Company and may have Contractor as original named inventor.

 

		7.	Conflicts of Interest. The Contractor
represents that it is free to enter into this Agreement, and that this engagement does not violate the terms of any agreement between
the Contractor and any third party.

 

		8.	Independent Contractor. This Agreement
shall not render the Contractor an employee, partner, agent of, or joint venturer with the Company for any purpose. In its capacity
as an independent contractor, Contractor agrees and represents, and Company agrees, as follows: Contractor has the right to perform
services for others during the term of this Agreement; Contractor has the sole right to control and direct the means, manner and
method by which the services required by this Agreement will be performed; Company shall not provide any insurance coverage of
any kind for Contractor; and Company shall not withhold from Contractor's compensation any amount that would normally be withheld
from an employee's pay. Contractor assumes full responsibility for payment of all taxes, including federal, state and local taxes,
arising out of Contractor’s activities under this Agreement. Contractor expressly releases Company from any liability arising
from Company’s failure to withhold such taxes, and Contractor shall indemnify, defend and hold Company harmless from all
liability it may incur as a result of any such failure. The Contractor shall have no claim against the Company hereunder or otherwise
for vacation pay, sick leave, retirement benefits, social security, worker’s compensation, health or disability benefits,
unemployment insurance benefits, or employee benefits of any kind.

 

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		9.	Notices. Any and all notices, demands,
or other communications required or desired to be given hereunder by any party shall be in writing and shall be validly given or
made to another party if personally served, or if deposited in the United States mail, certified or registered, postage prepaid,
return receipt requested. If such notice or demand is served personally, notice shall be deemed constructively made at the time
of such personal service. If such notice, demand or other communication is given by mail, such notice shall be conclusively deemed
given five days after deposit thereof in the United States mail addressed to the party to whom such notice, demand or other communication
is to be given as follows:

 

	 	If to the Contractor:	Cognitive Carbon Corporation

Attn: Kevin Hess

916 Fiddlers Creek Rd.

Ponte Vedra Beach, FL 32082

 

	 	If to the Company:	Drone Aviation Holding Corp

Attn: President

11651 Central Parkway #118

Jacksonville FL 32224

 

Any party hereto may change
its address for purposes of this paragraph by written notice given in the manner provided above.

 

		10.	Modification or Amendment. No amendment,
change, or modification of this Agreement shall be valid unless in writing signed by the parties hereto.

 

		11.	Entire Understanding. This document
and any exhibit attached constitute the entire understanding and agreement of the parties with regard to the Services to be provided
hereunder, and any and all prior agreements, understandings, and representations are hereby terminated and canceled in their entirety
and are of no further force and effect. 

 

		12.	Unenforceability of Provisions.
If any provision of this Agreement, or any portion thereof, is held to be invalid and unenforceable, then the remainder of this
Agreement shall nevertheless remain in full force and effect.

 

		13.	Governing Law. This Agreement shall
be construed in accordance with and governed for all purposes by the laws of State of Florida applicable to contracts executed
and wholly performed within such jurisdiction, without regard to its internal choice of law analysis. Any dispute arising hereunder
shall be referred to and heard only in an appropriate court of competent jurisdiction in Duval County, Florida.

 

		14.	Warranties. Contractor warrants
and represents that: (a) the services shall be performed in accordance with description set forth in the applicable statement of
work; (b) that the Work Product will operate in accordance with and will conform with the description of such Work Product found
in the applicable statement of work; (c) the services or work product shall not infringe upon or constitute a misuse any copyright,
patent, trade secret or other proprietary rights; (d) Contractor has the authority to enter into this Agreement and to perform
all obligations hereunder, including, but not limited to, the grant of rights and licenses to the Work Product and all proprietary
rights therein or based thereon; and (e) Contractor has not granted any rights or licenses to any intellectual property or technology
that would conflict with Contractor’s obligations under this Agreement.

 

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		15.	Indemnification. Contractor will
indemnify and hold harmless the Company and its affiliates, directors, officers, employees, agents, and representatives against
any and all suits, losses, claims, damages, liabilities, costs and expenses (including reasonable attorneys' fees and other costs
of defending any action) which such parties may sustain or incur in connection with (a) a breach of any representation, warranty,
or undertaking made by Contractor in performance of this Agreement or such parties’ enforcement of this Agreement, (b) any
suit, claim or demand based upon any legal theory, including, without limitation, negligence, breach of warranty or strict liability
in tort in connection with the services performed or provided hereunder, except to the extent caused by the sole negligence or
intentional acts of Company, or (c) Contractor’s failure to comply with any applicable laws, codes, regulations, ordinances
or statutory requirements of any authority having jurisdiction over the Agreement or the services. 

 

		16.	Insurance. Contractor shall carry
the following minimum insurance coverages in a form acceptable to Company at all times while this Agreement is in effect: (i) Comprehensive
Liability Insurance with coverage limits of at least $250,000 per occurrence for any and all injury, death or property damage,
(ii) Workers compensation insurance as required by law; (iii) Personal and advertising injury insurance in an amount not less than
$250,000; and (iv) errors and omissions with coverage limits of at least $250,000. On an annual basis, Contractor shall provide
Company with a copy of the applicable insurance binder or declarations page for each such policy. Neither the existence of nor
the assent of Company to the types of limits of insurance carried by Contractor shall be deemed a waiver or release of responsibility
under this Agreement.

 

		17.	Sub-Contractors. Contractor may
hire or engage one or more subcontractors to perform any or all of its obligations under this Agreement; provided that with regard
to any Services provided by a sub-contractor, Contractor shall in all cases remain responsible for all of its obligations under
this Agreement with respect to the scope of the Services, any representations and warranties provided hereunder, and all indemnification
obligations hereunder.

 

		18.	Compliance. Contractor shall obtain
all federal, state and local licenses and permits required for provision of the Services and shall be responsible for all sales,
use, excise, state and local business and income taxes attributable to the Services (including remittance thereof to the appropriate
authorities). Any penalties, financial or otherwise, imposed due to Contractor’s acts or omissions in providing the Services
will be paid by or be the responsibility of Contractor.

 

		19.	Independent Review. Contractor
affirms that he has carefully read this entire Agreement. He attests that he possesses sufficient information, knowledge, understanding
and experience to fully understand the extent and impact of its provisions. Contractor affirms that he has been advised to consult
the attorney of his choice about this Agreement, and that by signing this Agreement he acknowledges that he has obtained whatever
legal advice he deemed appropriate. Contractor affirms that he is fully competent to execute this Agreement and that he does so
voluntarily and without any coercion, undue influence, threat or intimidation of any kind.

 

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IN WITNESS WHEREOF the undersigned have
executed this Agreement as of the day and year first written above. The parties hereto agree that facsimile signatures shall be
as effective as if originals.

 

	Drone Aviation Holding Corp.	 	Cognitive Carbon Corporation
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	By: 	          	 	By: 	                       
	Kendall Carpenter, EVP and CFO	 	Kevin Hess, CTO
	 	 	 	FEIN:
		 	 	Phone Number 904-540-0150
		 	 	Email: khess@cognitivecarbon.com

 

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EXHIBIT A

 

STATEMENT OF WORK, TERM, AND COMPENSATION

CTO SERVICES

SALES AND MARKETING SERVICES

 

	DUTIES:	The Contractor will provide outsourced Company CTO services, and sales and marketing services.

 

DELIVERABLES:

CTO services include, but are not
limited to: provide technology and manufacturing direction to Drone Aviation staff and 3rd party contractors, vendor
management, facilities management, Drone Aviation customer meetings, establish and maintain partner relationships related to technologies
that enable or improve Drone Aviation products, creation and assistance with patents or other intellectual property. Additionally,
new product development, enhancements to existing products and determination of pricing, and occasional investor-related meetings
if requested.

 

Sales and marketing services include,
but are not limited to: customer and partner meetings, strategy development and go-to-market program for products and systems,
promotion of Drone Aviation products and services, closing of sales with end-customers, channel partners and prime contractors.

 

	TERM:	The initial term of this Exhibit A shall be one year commencing March 31, 2019 with automatic twelve
(12) month renewals thereafter unless Drone notifies its intent not to renew within 30 days of renewal. Either party may terminate
upon written notice of material breach by the other party that is not cured within 15 days from the date of notice.

 

COMPENSATION:

 

Contractor shall submit detailed
monthly invoices by the 3rd day of the subsequent month. Approved invoices will be paid within 15 days.

 

As full compensation for the services
rendered pursuant to this Agreement, the Company shall pay the Contractor:

 

CTO Services; monthly $19,750

 

BONUSES:

 

Pursuant to Annual Board Approved Compensation
Plan (Exhibit B)

 

	Drone Aviation Holding Corp.	 	Cognitive Carbon Corporation
	 	 	 	 	 
	By:	       	 	By:	               
	Kendall Carpenter, EVP and CFO	 	Kevin Hess, CTO
	Date:	 	 	Date:	 

 

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EXHIBIT B

 

COMPENSATION PLAN

CTO SERVICES

SALES AND MARKETING SERVICES

 

	2019 MANAGEMENT BONUS PLAN	 	Kevin	 	 	 
	 	 	 	 	 	 
	BONUS BASED ON NAMED ACCOUNTS:	 	DOD	 	 	 
	2019 recognized revenue from invoiced goods and services sold to named account. Target is $5,000,000 for full bonus of $175,000.	 	$	175,000	 	 	Note #1 - Board may consider additional bonus, at its
    discretion, if cap is hit
	Min Bonus: First $2,000,000 in bookings bonus is $70,000. Second $2,000,000 in booking bonus is $70,000. Then prorate target/bonus from $4M to $5M for full 100%. SuperBonus: For every Pct above target, bonus will increase by same Pct, capped at 150% of full bonus ($262,500).	 	 	 	 	 	Note #2 - At end of month, determine bookings. When first $2,000,000
    is achieved, accrue $70,000 bonus with $35,000 paid as soon as practicable and $35,000 paid when customer settles their invoice.
    Repeat process for second $2,000,000.
	 	 	 	 	 	 	 
	BONUS BASED ON RESULTS	 	 	 	 	 	 
	2019 successful manufacturing and delivery. Target is $3.8M for CBP and $2.0M for SFAB/Army for full 100% bonus, all-or-nothing	 	$	125,000	 	 	Note #3 - At end of 2019, determine if target has been achieved.
    If so, calculate and accrue earned bonus and pay out at the end of 2019.
	 	 	 	 	 	 	 
	FULL TARGET BONUS	 	$	300,000	 	 	 

  

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EXHIBIT C

 

STATEMENT OF WORK, TERM, AND BASE COMPENSATION

SOFTWARE AND PLATFORM DEVELOPMENT SERVICES

 

	DUTIES:	The Contractor will provide outsourced software and platform development

 

	DELIVERABLES:	
	 	Software and Platform Development
are defined as; Flight Management System and Ground Control Station development and support. Scope of the FMS includes up to 12
sensors, establishing and maintaining the cloud computing environment, operator and FSR management notifications and alerts and
3-4 UX screens.

 

Reporting dashboard: System monitoring,
alerts, reports for uptime, flight hours, weather reported by local station and METARs

 

SOW:

Cognitive Carbon Corporation will
provide resources necessary for each stage of the project.

 

Phase One:  architecture definition;
a) establish AWS tools and environment necessary to provide sensor aggregation persistence, calculations, notifications and reporting,
b) establish the launcher/local architecture for sensor aggregation and persistence that provides LTE and Satellite transfer of
full data sets and control codes, c) determine local data transfer protocols and methods, adhering to IoT standards and best practices
where appropriate.

 

Resources: BA, Tech lead, Platform
architect

 

Phase Two: development of local
and cloud environments to support requirements

 

Resources: BA, Tech lead, 2 developers
(html5, .NET), data architect

 

Phase Three: development of user
experience UI (dashboard, agent operating screens), implementation of notifications and alerts, implementation of business rules
for standardized UOMs, launcher and main component serialization nomenclature.

 

Resources: BA, Tech lead, 2 developers
(html5, .NET), data architect, QA

 

Phase Four: Maintenance of the
cloud computing environment, break/fix of software defects, software enhancements that can be accommodated by support resources.

 

	TERM:	March ___, 2019 through the date of final approval of deliverables to be provided hereunder. Company
may terminate this Exhibit B on thirty days written notice provided that Company shall pay amounts owed and approved prior to the
date of termination.

 

COMPENSATION:

 

Contractor shall submit detailed
monthly invoices by the 3rd day of the subsequent month. Approved invoices will be paid within 15 days.

 

As full compensation for the services
rendered pursuant to this Agreement, the Company shall pay the Contractor:

 

Software and Platform Development;
as incurred, provided that the maximum amount due under this Exhibit B is $120,000.

 

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EXHIBIT C

 

STATEMENT OF WORK, TERM, AND BASE COMPENSATION

SOFTWARE AND PLATFORM DEVELOPMENT SERVICES

 

Signature Page

 

	Drone Aviation Holding Corp.	 	Cognitive Carbon Corporation
	 	 	 	 	 
	By:	       	 	By:	       
	Kendall Carpenter, EVP and CFO	 	Kevin Hess, CTO
	Date:	 	 	Date:	 

 

 

 

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	Page 9Exhibit 4.1

 

AMERIPRISE FINANCIAL, INC.

 

3.000% Senior Note due 2022

 

	
No. 
    	
 
    	
$
    
	
 
    	
 
    	
 
    
	
CUSIP No. 03076C AJ5
    	
 
    	
 
    

 

AMERIPRISE FINANCIAL, INC., a Delaware corporation (hereinafter called the “Company”, which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & Co. or registered assigns, the principal sum of          Dollars ($            ) on March 22, 2022, and to pay interest (computed on the basis of a 360-day year comprised of twelve 30-day months) thereon from March 22, 2019, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, on each March 22 and September 22, commencing September 22, 2019, and at maturity, at the rate per annum specified in the title of this Note, until the principal hereof is paid or made available for payment.  The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in said Indenture, be paid to the Person in whose name this Note (or one or more Predecessor Securities) is registered at the close of business on the last day of the month preceding each respective Interest Payment Date (February 28 or 29, as applicable, or August 31) and at maturity.  In any case where such Interest Payment Date shall not be a Business Day, then (notwithstanding any other provision of said Indenture or the Notes) payment of such interest need not be made on such date, but may be made on the next succeeding Business Day with the same force and effect as if made on such date, and, if such payment is so made, no interest shall accrue for the period from and after such date. Any such interest not so punctually paid or duly provided for shall forthwith cease to be payable to the registered Holder on the initial record date for such interest payment (February 28 or 29, as applicable, or August 31, as the case may be), and may be paid to the Person in whose name this Note (or one or more Predecessor Securities) is registered at the close of business on a record date for the payment of such Defaulted Interest to be fixed by the Trustee for the Notes, notice whereof shall be given to Holders of Notes not less than 10 days prior to such record date, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture. Payment of the principal, premium, if any, and interest on this Note will be made at the office or agency of the Company maintained for that purpose in the City of St. Paul, Minnesota, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that at the option of the Company payment of interest may be made (subject to collection) by check mailed to the address of the Person entitled thereto as such address shall appear on the Securities Register.

 

ADDITIONAL PROVISIONS OF THIS NOTE ARE CONTAINED ON THE REVERSE HEREOF AND SUCH PROVISIONS SHALL HAVE THE SAME EFFECT AS THOUGH FULLY SET FORTH IN THIS PLACE.

 

Unless the certificate of authentication hereon has been executed by or on behalf of the Trustee for the Notes by manual signature, this Note shall not be entitled to any benefit under the Indenture, or be valid or obligatory for any purpose.

 

 

IN WITNESS WHEREOF, AMERIPRISE FINANCIAL, INC. has caused this instrument to be duly executed under its corporate seal.

 

Dated:  March 22, 2019

 

	
 
    	
AMERIPRISE   FINANCIAL, INC.  
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
James A. Brefeld 
    
	
 
    	
 
    	
SVP Treasurer
    
	
 
    	
 
    
	
 
    	
Attest 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Thomas R. Moore
    
	
 
    	
 
    	
Corporate Secretary and   Chief Governance Officer
    

 

2

 

This is one of the Securities of the series designated herein and referred to in the within-mentioned Indenture.

 

Dated:  March 22, 2019

 

	
 
    	
U.S. BANK NATIONAL   ASSOCIATION
    
	
 
    	
as Trustee
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Joshua A. Hahn
    
	
 
    	
 
    	
Vice President
    

 

3

 

AMERIPRISE FINANCIAL, INC.

 

3.000% Senior Note due 2022

 

This Note is one of a duly authorized issue of debentures, notes or other evidences or indebtedness (hereinafter called the “Securities”) of the Company of the series hereinafter specified, which series is initially limited in aggregate principal amount to $500,000,000 (except as provided in the Indenture hereinafter mentioned), all such Securities issued and to be issued under an Indenture dated as of May 5, 2006 between the Company and U.S. Bank National Association, as Trustee (the “Indenture”), to which the Indenture and all indentures supplemental thereto reference is hereby made for a statement of the rights and limitation of rights thereunder of the Holders of the Securities and of the rights, obligations, duties and immunities of the Trustee for each series of Securities and of the Company, and the terms upon which the Securities are and are to be authenticated and delivered. As provided in the Indenture, the Securities may be issued in one or more series, which different series may be issued in various aggregate principal amounts, may be denominated in currencies other than U.S. dollars (including composite currencies), may mature at different times, may bear interest, if any, at different rates, may be subject to different redemption provisions, if any, may be subject to different sinking, purchase or analogous funds, if any, may be subject to different covenants and Events of Default and may otherwise vary as provided in or permitted by the Indenture. This Note is one of a series of the Securities designated 3.000% Senior Notes due 2022 (the “Notes”).

 

Prior to the Stated Maturity the Company may, at its option, at any time and from time to time, redeem the Notes in whole or in part, by lot or as otherwise determined by the Depository Trust Company, at the applicable Redemption Price. The Notes will be redeemable at a Redemption Price, plus accrued and unpaid interest to the Redemption Date, equal to the greater of (1) 100% of the principal amount of the Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest on the Notes to be redeemed that would be due after the related Redemption Date but for such redemption (except that, if such Redemption Date is not an Interest Payment Date, the amount of the next succeeding scheduled interest payment will be reduced by the amount of interest accrued thereon to the Redemption Date), discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 15 basis points.

 

Notice of redemption shall be sent to the registered Holders of the Notes designated for redemption at their addresses as the same shall appear on the Securities Register, not less than 15 days nor more than 60 days prior to the Redemption Date, subject to all the conditions and provisions of the Indenture.

 

In the event of redemption of this Note in part only, a new Note or Notes for the amount of the unredeemed portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof.

 

“Treasury Rate” means, with respect to any Redemption Date, the rate per annum equal to the semi-annual equivalent yield to maturity (computed as of the second Business Day immediately preceding such Redemption Date) of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such Redemption Date.

 

“Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker that would be utilized, at the time of selection and in accordance with customary

 

4

 

financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the Notes.

 

“Comparable Treasury Price” means, with respect to any Redemption Date, (1) the average of the Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and lowest of such Reference Treasury Dealer Quotations, or (2) if the Company obtains fewer than four such Reference Treasury Dealer Quotations, the average of all quotations obtained.

 

“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Company.

 

“Reference Treasury Dealer” means each of Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated and their respective successors and two other nationally recognized investment banking firms that are Primary Treasury Dealers specified from time to time by the Company, except that if any of the foregoing ceases to be a primary U.S. Government securities dealer in the United States (a “Primary Treasury Dealer”), the Company is required to designate as a substitute another nationally recognized investment banking firm that is a Primary Treasury Dealer.

 

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any Redemption Date, the average, as determined by the Company, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Company by such Reference Treasury Dealer as of 3:30 p.m., New York City time, on the third Business Day preceding such Redemption Date, or in the event of a satisfaction and discharge, within three business days prior to the deposit of funds with the Trustee.

 

On and after any Redemption Date, interest will cease to accrue on the Notes called for redemption.  Prior to any Redemption Date, the Company is required to deposit with a Paying Agent money sufficient to pay the Redemption Price of and accrued interest on the Notes to be redeemed on such date.  If the Company is redeeming less than all the Notes, the Trustee under the Indenture must select the Notes to be redeemed by such method as the Trustee deems fair and appropriate in accordance with methods generally used at the time of selection by fiduciaries in similar circumstances.

 

The Indenture contains provisions for defeasance and discharge of the entire principal of all the Securities of any series upon compliance by the Company with certain conditions set forth therein.

 

If an Event of Default with respect to the Notes, as defined in the Indenture, shall occur and be continuing, the principal of all the Notes may be declared due and payable in the manner and with the effect provided in the Indenture.

 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Securities of any series under the Indenture at any time by the Company with the consent of the Holders of not less than a majority in aggregate principal amount of the Outstanding Securities of each series affected thereby.  The Indenture also contains provisions permitting the Holders of specified percentages in aggregate principal amount of the Securities of any series at the time Outstanding, on behalf of the Holders of all the Securities of such series, to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences with respect to such series. Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the transfer hereof or in

 

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exchange herefor or in lieu hereof whether or not notation of such consent or waiver is made upon this Note.

 

No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal, premium, if any, and interest on this Note at the times, place and rate, and in the coin or currency, herein prescribed.

 

As provided in the Indenture and subject to certain limitations therein set forth, this Note is transferable on the Securities Register of the Company, upon surrender of this Note for registration of transfer at the office or agency of the Company to be maintained for that purpose in the City of St. Paul, Minnesota, or at any other office or agency of the Company maintained for that purpose, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Securities Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

 

The Notes are issuable only in registered form without coupons in denominations of $2,000 and integral multiples of $1,000 in excess thereof.  As provided in the Indenture and subject to certain limitations therein set forth, Notes are exchangeable for a like aggregate principal amount of Notes of the same series of other authorized denominations, as requested by the Holder surrendering the same.

 

No service charge shall be made for any such transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the registration of such transfer or exchange, other than certain exchanges not involving any transfer.

 

Certain terms used in this Note which are defined in the Indenture have the meanings set forth therein.

 

This Note shall for all purposes be governed by, and construed in accordance with, the laws of the State of New York.

 

Prior to due presentment for registration of transfer, the Company, the Trustee for the Notes and any agent of the Company or such Trustee may treat the Person in whose name this Note is registered as the owner hereof for the purpose of receiving payment as herein provided and for all other purposes, whether or not this Note be overdue, and neither the Company, such Trustee nor any such agent shall be affected by notice to the contrary.

 

The Company may, without consent of the Holders of the Notes but in compliance with the terms of the Indenture, increase the principal amount of the Notes by issuing additional Notes on the same terms and conditions as the Notes, except for any differences in the issue price and interest accrued prior to the date of issuance of the additional Notes, and with the same CUSIP number as the Notes; provided that if any such further Notes are not fungible with the notes for United States federal income tax purposes, they will be issued with a different CUSIP number. The Notes and any additional Notes issued by the Company will rank equally and ratably and shall be treated as a single series of Securities for all purposes under the Indenture. No additional Notes shall be issued at any time that there is an Event of Default under the Indenture with respect to the Notes that has occurred and is continuing.

 

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