Document:

Exhibit

Exhibit 4.6

ALABAMA POWER COMPANY

TO

REGIONS BANK
TRUSTEE

FIFTY-EIGHTH SUPPLEMENTAL INDENTURE

DATED AS OF JUNE 28, 2018

SERIES 2018A 4.300% SENIOR NOTES

DUE JULY 15, 2048

TABLE OF CONTENTS1 

	
				
	 
	 
	PAGE
	

	 
	 
	 

	ARTICLE 1  Series 2018A Senior Notes
	1
	

	 
	 
	 

	 
	SECTION 101. Establishment
	1
	

	 
	SECTION 102. Definitions
	2
	

	 
	SECTION 103. Payment of Principal and Interest
	3
	

	 
	SECTION 104. Denominations
	4
	

	 
	SECTION 105. Global Securities
	4
	

	 
	SECTION 106. Transfer
	4
	

	 
	SECTION 107. Redemption and the Company’s Option
	5
	

	 
	 
	 

	ARTICLE 2  Miscellaneous Provisions
	5
	

	 
	 
	 

	 
	SECTION 201. Recitals by Company
	5
	

	 
	SECTION 202. Ratification and Incorporation of Original Indenture
	6
	

	 
	SECTION 203. Executed in Counterparts
	6
	

	 
	 
	 

	EXHIBIT A  Form of Series 2018A Note
	A-1
	

	 
	 
	 

	EXHIBIT B  Certificate of Authentication
	B-1
	

	
		
	 
	 

1This Table of Contents does not constitute part of the Fifty-Eighth Supplemental Indenture or have any bearing upon the interpretation of any of its terms and provisions.

THIS FIFTY-EIGHTH SUPPLEMENTAL INDENTURE is made as of the 28th day of June, 2018, by and between ALABAMA POWER COMPANY, an Alabama corporation, 600 North 18th Street, Birmingham, Alabama 35291 (the “Company”), and REGIONS BANK, an Alabama banking corporation, 1900 Fifth Avenue North, 25th Floor, Birmingham, Alabama 35203 (the “Trustee”).
W I T N E S S E T H:
WHEREAS, the Company has heretofore entered into a Senior Note Indenture, dated as of December 1, 1997 (the “Original Indenture”), with Regions Bank (as successor to The Bank of New York Mellon (as successor to JPMorgan Chase Bank, N.A. (formerly known as The Chase Manhattan Bank))), as Trustee, as heretofore supplemented;
WHEREAS, the Original Indenture is incorporated herein by this reference and the Original Indenture, as heretofore supplemented and as further supplemented by this Fifty-Eighth Supplemental Indenture, is herein called the “Indenture”;
WHEREAS, under the Original Indenture, a new series of Senior Notes may at any time be established pursuant to a supplemental indenture executed by the Company and the Trustee;
WHEREAS, the Company proposes to create under the Indenture a new series of Senior Notes;
WHEREAS, additional Senior Notes of other series hereafter established, except as may be limited in the Original Indenture as at the time supplemented and modified, may be issued from time to time pursuant to the Indenture as at the time supplemented and modified; and
WHEREAS, all conditions necessary to authorize the execution and delivery of this Fifty-Eighth Supplemental Indenture and to make it a valid and binding obligation of the Company have been done or performed.
NOW, THEREFORE, in consideration of the agreements and obligations set forth herein and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE 1
Series 2018A Senior Notes
SECTION 101.  Establishment.  There is hereby established a new series of Senior Notes to be issued under the Indenture, to be designated as the Company’s Series 2018A 4.300% Senior Notes due July 15, 2048 (the “Series 2018A Notes”).
There are to be authenticated and delivered $500,000,000 aggregate principal amount of Series 2018A Notes, and such principal amount of the Series 2018A Notes may be increased from time to time pursuant to Section 301 of the Original Indenture.  All Series 2018A Notes need not be issued at the same time and such series may be reopened at any time, without the consent of any 

1

Holder, for issuances of additional Series 2018A Notes.  Any such additional Series 2018A Notes will have the same interest rate, maturity and other terms as those initially issued (except for the public offering price and Original Issue Date and the initial interest accrual date and initial Interest Payment Date, if applicable).  No Series 2018A Notes shall be authenticated and delivered in excess of the principal amount as so increased except as provided by Sections 203, 303, 304, 907 or 1107 of the Original Indenture.  The Series 2018A Notes shall be issued in definitive fully registered form.
The Series 2018A Notes shall be issued in the form of one or more Global Securities in substantially the form set out in Exhibit A hereto.  The Depositary with respect to the Series 2018A Notes shall be The Depository Trust Company.
The form of the Trustee’s Certificate of Authentication for the Series 2018A Notes shall be in substantially the form set forth in Exhibit B hereto.
Each Series 2018A Note shall be dated the date of authentication thereof and shall bear interest from the date of original issuance thereof or from the most recent Interest Payment Date to which interest has been paid or duly provided for.
SECTION 102.  Definitions.  The following defined terms used herein shall, unless the context otherwise requires, have the meanings specified below.  Capitalized terms used herein for which no definition is provided herein shall have the meanings set forth in the Original Indenture.
“Comparable Treasury Issue” means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Series 2018A Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the Series 2018A Notes.
“Comparable Treasury Price” means, with respect to any Redemption Date (i) the average of the Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (ii) if the Company obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such quotations.
“Independent Investment Banker” means an independent investment banking institution of national standing appointed by the Company.
“Interest Payment Dates” means January 15 and July 15 of each year, commencing January 15, 2019.
“Original Issue Date” means June 28, 2018.
“Reference Treasury Dealer” means a primary U.S. Government securities dealer in the United States appointed by the Company.
“Reference Treasury Dealer Quotation” means, with respect to a Reference Treasury Dealer and any Redemption Date, the average, as determined by the Company, of the bid and asked prices 

2

for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount and quoted in writing to the Company by such Reference Treasury Dealer at 5:00 p.m. on the third Business Day in New York City preceding such Redemption Date).
“Regular Record Date” means, with respect to each Interest Payment Date, the close of business on the 15th calendar day preceding such Interest Payment Date (whether or not a Business Day).
“Stated Maturity” means July 15, 2048.
“Treasury Yield” means, with respect to any Redemption Date, the rate per annum equal to the semiannual equivalent yield to maturity 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.
SECTION 103.  Payment of Principal and Interest.  The principal of the Series 2018A Notes shall be due at Stated Maturity (unless earlier redeemed).  The unpaid principal amount of the Series 2018A Notes shall bear interest at the rate of 4.300% per annum until paid or duly provided for.  Interest shall be paid semiannually in arrears on each Interest Payment Date to the Person in whose name the Series 2018A Notes are registered on the Regular Record Date for such Interest Payment Date, provided that interest payable at the Stated Maturity or on a Redemption Date as provided herein will be paid to the Person to whom principal is payable.  Any such interest that is not so punctually paid or duly provided for will forthwith cease to be payable to the Holders on such Regular Record Date and may either be paid to the Person or Persons in whose name the Series 2018A Notes are registered at the close of business on a Special Record Date for the payment of such defaulted interest to be fixed by the Trustee, notice whereof shall be given to Holders of the Series 2018A Notes not less than ten (10) days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange, if any, on which the Series 2018A Notes shall be listed, and upon such notice as may be required by any such exchange, all as more fully provided in the Original Indenture.
Payments of interest on the Series 2018A Notes will include interest accrued to but excluding the respective Interest Payment Dates.  Interest payments for the Series 2018A Notes shall be computed and paid on the basis of a 360-day year of twelve 30-day months.  In the event that any date on which interest is payable on the Series 2018A Notes is not a Business Day, then payment of the interest payable on such date will be made on the next succeeding day that is a Business Day (and without any interest or other payment in respect of any such delay), with the same force and effect as if made on the date the payment was originally payable.
Payment of the principal and interest due at the Stated Maturity or earlier redemption of the Series 2018A Notes shall be made upon surrender of the Series 2018A Notes at the Corporate Trust Office of the Trustee.  The principal of and interest on the Series 2018A Notes shall be paid 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.  Payments of interest (including interest on any Interest Payment Date) will be made, subject to such surrender where applicable, at the option of the Company, (i) by check mailed to the address of the Person entitled thereto as such address shall appear in the Security 

3

Register or (ii) by wire transfer or other electronic transfer at such place and to such account at a banking institution in the United States as may be designated in writing to the Trustee at least sixteen (16) days prior to the date for payment by the Person entitled thereto.  
SECTION 104.  Denominations.  The Series 2018A Notes may be issued in denominations of $2,000 and integral multiples of $1,000 in excess thereof.
SECTION 105.  Global Securities.  The Series 2018A Notes will be issued in the form of one or more Global Securities registered in the name of the Depositary (which shall be The Depository Trust Company) or its nominee.  Except under the limited circumstances described below, Series 2018A Notes represented by one or more Global Securities will not be exchangeable for, and will not otherwise be issuable as, Series 2018A Notes in definitive form.  The Global Securities described above may not be transferred except by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or to a successor Depositary or its nominee.
Owners of beneficial interests in such a Global Security will not be considered the Holders thereof for any purpose under the Indenture, and no Global Security representing a Series 2018A Note shall be exchangeable, except for another Global Security of like denomination and tenor to be registered in the name of the Depositary or its nominee or a successor Depositary or its nominee.  The rights of Holders of such Global Security shall be exercised only through the Depositary.
Neither the Company, the Trustee, nor any agent of the Company or the Trustee shall have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in a Global Security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests.
Subject to the procedures of the Depositary, a Global Security shall be exchangeable for Series 2018A Notes registered in the names of persons other than the Depositary or its nominee only if (i) the Depositary notifies the Company that it is unwilling or unable to continue as a Depositary for such Global Security and no successor Depositary shall have been appointed by the Company, or if at any time the Depositary ceases to be a clearing agency registered under the Securities Exchange Act of 1934, as amended, at a time when the Depositary is required to be so registered to act as such Depositary and no successor Depositary shall have been appointed by the Company, in each case within 90 days after the Company receives such notice or becomes aware of such cessation, (ii) the Company in its sole discretion determines that such Global Security shall be so exchangeable, or (iii) there shall have occurred an Event of Default with respect to the Series 2018A Notes.  Any Global Security that is exchangeable pursuant to the preceding sentence shall be exchangeable for Series 2018A Notes registered in such names as the Depositary shall direct.
SECTION 106.  Transfer.  No service charge will be made for any transfer or exchange of Series 2018A Notes, but payment will be required of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith.
The Company shall not be required (a) to issue, register the transfer of or exchange any Series 2018A Notes during a period beginning at the opening of business fifteen (15) days before 

4

the date of the mailing of a notice pursuant to Section 1104 of the Original Indenture identifying the serial numbers of the Series 2018A Notes to be called for redemption, and ending at the close of business on the day of the mailing, or (b) to issue, register the transfer of or exchange any Series 2018A Notes theretofore selected for redemption in whole or in part, except the unredeemed portion of any Series 2018A Notes redeemed in part.
SECTION 107.  Redemption at the Company’s Option.  At any time and from time to time prior to January 15, 2048, the Series 2018A Notes will be subject to redemption at the option of the Company in whole or in part upon not less than 30 nor more than 60 days’ notice, at Redemption Prices equal to the greater of (i) 100% of the principal amount of the Series 2018A Notes being redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal of and interest on the Series 2018A Notes being redeemed (not including any portion of such payments of interest accrued to the Redemption Date), discounted (for purposes of determining present value) to the Redemption Date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at a discount rate equal to the Treasury Yield plus 20 basis points, plus, in each case, accrued and unpaid interest thereon to the Redemption Date.  At any time and from time to time on or after January 15, 2048, the Series 2018A Notes will be subject to redemption at the option of the Company in whole or in part upon not less than 30 nor more than 60 days’ notice, at a Redemption Price equal to 100% of the principal amount of the Series 2018A Notes being redeemed plus accrued and unpaid interest thereon to the Redemption Date. 
In the event of redemption of the Series 2018A Notes in part only, a new Series 2018A Note or Notes for the unredeemed portion will be issued in the name or names of the Holders thereof upon the surrender thereof.
The Series 2018A Notes will not have a sinking fund.
Notice of redemption shall be given as provided in Section 1104 of the Original Indenture, except that any notice of redemption with respect to any redemption occurring prior to January 15, 2048 shall not specify the Redemption Price therefor but only the manner of calculation thereof.  The Trustee shall not be responsible for the calculation of such Redemption Price.  The Company shall calculate such Redemption Price and promptly notify the Trustee thereof.
Any redemption of less than all of the Series 2018A Notes shall, with respect to the principal thereof, be divisible by $1,000.
ARTICLE 2
Miscellaneous Provisions
SECTION 201.  Recitals by Company.  The recitals in this Fifty-Eighth Supplemental Indenture are made by the Company only and not by the Trustee, and all of the provisions contained in the Original Indenture in respect of the rights, privileges, immunities, powers and duties of the Trustee shall be applicable in respect of Series 2018A Notes and of this Fifty-Eighth Supplemental Indenture as fully and with like effect as if set forth herein in full.

5

SECTION 202.  Ratification and Incorporation of Original Indenture.  As supplemented hereby, the Original Indenture is in all respects ratified and confirmed, and the Original Indenture as supplemented by this Fifty-Eighth Supplemental Indenture shall be read, taken and construed as one and the same instrument.
SECTION 203.  Executed in Counterparts.  This Fifty-Eighth Supplemental Indenture may be simultaneously executed in several counterparts, each of which shall be deemed to be an original, and such counterparts shall together constitute but one and the same instrument.

6

IN WITNESS WHEREOF, each party hereto has caused this instrument to be signed in its name and behalf by its duly authorized officers, all as of the day and year first above written.

	
					
	ATTEST:

	 
	ALABAMA POWER COMPANY

	By:
	/s/Ceila H. Shorts
	 
	By:
	/s/Philip C. Raymond

	 
	Ceila H. Shorts
	 
	 
	Philip C. Raymond

	 
	Corporate Secretary
	 
	 
	Executive Vice President,
Chief Financial Officer and 
Treasurer

	 
	

	 
	 
	 

	ATTEST:
	 
	REGIONS BANK,
as Trustee

	 
	

	 
	 
	 

	By:
	/s/Scott Rearden
	 
	By:
	/s/Patti Maner

	 
	Scott Rearden
	 
	 
	Patti Maner

	 
	Senior Vice President
	 
	 
	Vice President

7

EXHIBIT A

FORM OF SERIES 2018A NOTE

	
		
	NO. __
	CUSIP NO. 010392 FS2

	 
	 

ALABAMA POWER COMPANY
SERIES 2018A 4.300% SENIOR NOTE
DUE JULY 15, 2048
	
		
	Principal Amount:
	$________________________

	Regular Record Date:
	15th calendar day prior to the applicable Interest Payment Date (whether or not a Business Day)

	Original Issue Date:
	June 28, 2018

	Stated Maturity:
	July 15, 2048

	Interest Payment Dates:
	January 15 and July 15

	Interest Rate:
	4.300%

	Authorized Denomination:
	$2,000 and integral multiples of $1,000 in excess thereof

Alabama Power Company, an Alabama corporation (the “Company”, which term includes any successor corporation under the Indenture referred to on the reverse hereof), for value received, hereby promises to pay to ___________________________________________, or registered assigns, the principal sum of ____________________________________________ DOLLARS ($______________) on the Stated Maturity shown above (or upon earlier redemption), and to pay interest thereon from the Original Issue Date shown above, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, semiannually in arrears on each Interest Payment Date as specified above, commencing on January 15, 2019, and on the Stated Maturity (or upon earlier redemption) at the rate per annum shown above until the principal hereof is paid or made available for payment and at such rate on any overdue principal and on any overdue installment of interest.  The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date (other than an Interest Payment Date that is the Stated Maturity or on a Redemption Date) will, as provided in such Indenture, be paid to the Person in whose name this Note (the “Note”) is registered at the close of business on the Regular Record Date as specified above next preceding such Interest Payment Date, provided that any interest payable at the Stated Maturity or on any Redemption Date will be paid to the Person to whom principal is payable.  Except as otherwise provided in the Indenture, any such interest not so punctually paid or duly provided 

A-1

for will forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Note is registered at the close of business on a Special Record Date for the payment of such defaulted interest to be fixed by the Trustee, notice whereof shall be given to Holders of Notes of this series not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange, if any, on which the Notes of this series shall be listed, and upon such notice as may be required by any such exchange, all as more fully provided in the Indenture.
Payments of interest on this Note will include interest accrued to but excluding the respective Interest Payment Dates.  Interest payments for this Note shall be computed and paid on the basis of a 360-day year of twelve 30-day months.  In the event that any Interest Payment Date would otherwise be a day that is not a Business Day, then payment of the interest payable on such date will be made on the next succeeding day that is a Business Day (and without any interest or other payment in respect of any such delay), with the same force and effect as if made on the date the payment was originally payable.  A “Business Day” shall mean any day other than a Saturday or a Sunday or a day on which banking institutions in New York City are authorized or required by law or executive order to remain closed or a day on which the Corporate Trust Office of the Trustee is closed for business.
Payment of the principal of and interest due at the Stated Maturity or earlier redemption of the Series 2018A Notes shall be made upon surrender of the Series 2018A Notes at the Corporate Trust Office of the Trustee.  The principal of and interest on the Series 2018A Notes shall be paid 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.  Payment of interest (including interest on an Interest Payment Date) will be made, subject to such surrender where applicable, at the option of the Company, (i) by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or (ii) by wire transfer or other electronic transfer at such place and to such account at a banking institution in the United States as may be designated in writing to the Trustee at least 16 days prior to the date for payment by the Person entitled thereto.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS PLACE.
Unless the certificate of authentication hereon has been executed by the Trustee by manual signature, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

A-2

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal.

	
					
	Dated:
	 
	 
	 
	 

	 
	 
	 
	ALABAMA POWER COMPANY

	 
	 
	 
	By:
	 

	 
	 
	 
	 
	Vice President

	 
	 
	 
	 
	 

	ATTEST:

	 
	 
	 

	 
	 
	 
	 
	 

	Assistant Secretary
	 
	 
	 

{Seal of ALABAMA POWER COMPANY appears here}

A-3

CERTIFICATE OF AUTHENTICATION

This is one of the Senior Notes referred to in the within-mentioned Indenture.

	
			
	 
	REGIONS BANK
as Trustee

	 
	By:
	 

	 
	 
	Authorized Signatory

A-4

(Reverse Side of Note)

This Note is one of a duly authorized issue of Senior Notes of the Company (the “Notes”), issued and issuable in one or more series under a Senior Note Indenture, dated as of December 1, 1997, as supplemented (the “Indenture”), between the Company and Regions Bank, (as successor to The Bank of New York Mellon (as successor to JPMorgan Chase Bank, N.A. (formerly known as The Chase Manhattan Bank))), Trustee (the “Trustee,” which term includes any successor trustee under the Indenture), to which Indenture and all indentures incidental thereto reference is hereby made for a statement of the respective rights, limitation of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Notes issued thereunder and of the terms upon which said Notes are, and are to be, authenticated and delivered.  This Note is one of the series designated on the face hereof as Series 2018A 4.300% Senior Notes due July 15, 2048 (the “Series 2018A Notes”) which is unlimited in aggregate principal amount.  Capitalized terms used herein for which no definition is provided herein shall have the meanings set forth in the Indenture.
At any time and from time to time prior to January 15, 2048, the Series 2018A Notes will be subject to redemption at the option of the Company in whole or in part upon not less than 30 nor more than 60 days’ notice, at Redemption Prices equal to the greater of (i) 100% of the principal amount of the Series 2018A Notes being redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal of and interest on the Series 2018A Notes being redeemed (not including any portion of such payments of interest accrued to the Redemption Date), discounted (for purposes of determining present value) to the Redemption Date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at a discount rate equal to the Treasury Yield plus 20 basis points, plus, in each case, accrued and unpaid interest thereon to the Redemption Date.  At any time and from time to time on or after January 15, 2048, the Series 2018A Notes will be subject to redemption at the option of the Company in whole or in part upon not less than 30 nor more than 60 days’ notice, at a Redemption Price equal to 100% of the principal amount of the Series 2018A Notes being redeemed plus accrued and unpaid interest thereon to the Redemption Date.
“Treasury Yield” means, with respect to any Redemption Date, the rate per annum equal to the semiannual equivalent yield to maturity 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 as having a maturity comparable to the remaining term of the Series 2018A Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the Series 2018A Notes.
“Comparable Treasury Price” means, with respect to any Redemption Date, (i) the average of the Reference Treasury Dealer Quotations for such Redemption Date, after excluding the highest 

A-5

and lowest such Reference Treasury Dealer Quotations, or (ii) if the Company obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such quotations.
“Independent Investment Banker” means an independent investment banking institution of national standing appointed by the Company.
“Reference Treasury Dealer” means a primary U.S. Government securities dealer in the United States appointed by the Company.
“Reference Treasury Dealer Quotation” means, with respect to a 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 and quoted in writing to the Company by such Reference Treasury Dealer at 5:00 p.m. on the third Business Day in New York City preceding such Redemption Date).
The Trustee shall not be responsible for the calculation of the Redemption Price with respect to a redemption occurring prior to January 15, 2048.  The Company shall calculate such Redemption Price and promptly notify the Trustee thereof.
In the event of redemption of this Note in part only, a new Note or Notes of this series for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the surrender hereof.  The Series 2018A Notes will not have a sinking fund.
If an Event of Default with respect to the Notes of this series shall occur and be continuing, the principal of the Notes of this series may be declared due and payable in the manner, with the effect and subject to the conditions 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 Notes of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of not less than a majority in principal amount of the Notes at the time Outstanding of each series to be affected.  The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Notes of each series at the time Outstanding, on behalf of the Holders of all Notes 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.  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 registration of transfer hereof or in exchange hereof 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 of and interest on this Note at the times, place and rate, and in the coin or currency, herein prescribed.

A-6

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Note is registerable in the Security Register, upon surrender of this Note for registration of transfer at the office or agency of the Company for such purpose, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar and duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes of this series, of authorized denominations and of like tenor and for the same aggregate principal amount, will be issued to the designated transferee or transferees.  No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Note is registered as the owner hereof for all purposes, whether or not this Note be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary.
The Notes of this series are issuable only in registered form without coupons in denominations of $2,000 and any integral multiples of $1,000 in excess thereof.  As provided in the Indenture and subject to certain limitations therein set forth, Notes of this series are exchangeable for a like aggregate principal amount of Notes of this series of a different authorized denomination, as requested by the Holder surrendering the same upon surrender of the Note or Notes to be exchanged at the office or agency of the Company.
This Note shall be governed by, and construed in accordance with, the internal laws of the State of New York.

A-7

ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they were written out in full according to applicable laws or regulations:
	
			
	TEN COM -
	as tenants in
common
	UNIF GIFT MIN ACT- _______ Custodian ________
(Cust)                       (Minor)

	TEN ENT -
	as tenants by the
entireties
	 

	JT TEN -
	as joint tenants
with right of
survivorship and
not as tenants
in common

	under Uniform Gifts to
Minors Act

________________________
(State)

Additional abbreviations may also be used
though not on the above list.
FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto 
______________________________________________________________________________
(please insert Social Security or other identifying number of assignee)

______________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF ASSIGNEE
______________________________________________________________________________

______________________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting and appointing
______________________________________________________________________________

______________________________________________________________________________
agent to transfer said Note on the books of the Company, with full power of substitution in the premises.
	
				
	Dated:
	 
	 
	 

	 
	 
	 
	 

	 
	 
	 
	 

NOTICE:  The signature to this assignment must correspond with the name as written upon the face of the within instrument in every particular without alteration or enlargement, or any change whatever.

A-8

EXHIBIT B

CERTIFICATE OF AUTHENTICATION

This is one of the Senior Notes referred to in the within-mentioned Indenture.

	
			
	 
	REGIONS BANK
as Trustee

	 
	By:
	 

	 
	 
	Authorized Signatory

B-1Blueprint

 

Exhibit 10.1

 

Execution Version

 

CHROMADEX CORPORATION

 

AMENDED AND RESTATED

EXECUTIVE EMPLOYMENT
AGREEMENT

 

for

 

ROBERT FRIED

 

This
Amended and Restated Executive Employment Agreement (this
“Agreement”) is
entered into as of June 22, 2018 (the “Effective Date”), by and between
Robert Fried (“Executive”) and ChromaDex
Corporation, a Delaware corporation (the “Company”).

 

WHEREAS, Executive
has served as a director of the Company since July 2015, and has
served as President and Chief Strategy Officer of the Company since
March 12, 2017 (which Chief Strategy Officer title Executive held
until March 2018) and has served as Chief Operating Officer of the
Company since January 8, 2018;

 

WHEREAS, Executive
and the Company are parties to that certain Executive Employment
Agreement, dated March 12, 2017, as amended by the Amendment to
Executive Employment Agreement, dated December 20, 2017, between
Executive and the Company (the “Prior Employment Agreement”);
and

 

WHEREAS, Executive
and the Company mutually desire that Executive continue to provide
services to the Company and its subsidiaries on the terms and
conditions provided for herein.

 

NOW,
THEREFORE, in consideration of the mutual covenants contained
herein, the sufficiency of which is hereby acknowledged, and
intending to be legally bound hereby, the parties agree as
follows:

 

1. 

Employment
by the Company.

 

1.1           Position.
Commencing on the Effective Date, Executive shall serve as the
Company’s Chief Executive Officer, reporting to the
Company’s Board of Directors (the “Board”). During the term of
Executive’s employment with the Company, Executive will
devote Executive’s commercially reasonable efforts and
substantially all of Executive’s business time and attention
to the business of the Company and its subsidiaries, except for
approved paid time off and reasonable periods of illness or other
incapacities permitted by the Company’s general employment
policies and applicable law. The foregoing is subject to the
permitted activities under Section 6.1 of this
Agreement.

 

1.2           Duties
and Location. Executive shall perform such duties as are
customarily associated with the position of Chief Executive Officer
and such other duties, commensurate with his position, as are
assigned to Executive by the Board. Executive’s primary
office location shall be in the Los Angeles, California area. The
Company reserves the right to reasonably require Executive to
perform Executive’s duties at the Company’s offices in
Irvine, California as required for the performance of his duties
and for business meetings with Company employees or representatives
of third parties, and to require reasonable business
travel.

 

 

 

 

1.3           Policies
and Procedures. The employment relationship between the
parties shall be governed by the general employment policies and
practices of the Company, except that when the terms of this
Agreement differ from or are in conflict with the Company’s
general employment policies or practices, this Agreement shall
control.

 

1.4           Board
Role. Executive shall initially continue to serve as a
director of the Company. Executive agrees to promptly resign as a
director of the Company if properly terminated for Cause (as
defined in Section
12.1 of this Agreement) pursuant to the terms of this
Agreement.

 

2. 

Compensation.

 

2.1           Base
Salary. Commencing on the Effective Date, Executive will
receive an initial base salary at the annual rate of $450,000, less
standard payroll deductions and withholdings and payable in
accordance with the Company’s regular payroll schedule.
Commencing as of the date that annual base salary adjustments go
into effect in connection with the Company’s fiscal year 2019
regular compensation review cycle, Executive’s annual rate of
base salary will be increased to $500,000. The base salary may
thereafter be increased from time to time, at the sole discretion
of the Board. The base salary may not be decreased, other than a
decrease of less than ten percent (10%) of Executive’s
highest base salary pursuant to a salary reduction program
applicable generally to the Company’s senior executives. The
initial base salary, as increased or decreased, shall be referred
to as “Base
Salary.”

 

2.2           Annual
Bonus. Commencing with fiscal year 2019, Executive will be
eligible to earn annual incentive compensation (the
“Performance
Bonus”), based on the achievement of individual and
corporate performance targets and metrics to be determined and
approved by the Board or the Compensation Committee thereof after
reasonable consultation with Executive. Executive’s target
Performance Bonus opportunity shall be 60% of Base Salary for the
applicable year (based on performance achievement at the 100%
level), with a maximum Performance Bonus opportunity of 90% of Base
Salary (based on performance achievement at the 150% level) and a
threshold Performance Bonus opportunity of 30% of Base Salary
(based on performance achievement at the 75% level), with payout
for performance to be interpolated on a straight-line basis between
threshold and target and between target and maximum. For the
avoidance of doubt, Executive will not be eligible to receive a
Performance Bonus for an applicable year in the event of
performance achievement below the 75% level. The Performance Bonus,
if earned, will be paid on an annual basis, less standard payroll
deductions and withholdings, after the close of the fiscal year and
after determination by the Board (or the Compensation Committee
thereof) of the level of achievement of the applicable performance
targets and metrics and the level of the bonus amount, but not
later than March 15 of the following calendar year. No Performance
Bonus amount is guaranteed and, in addition to the other conditions
for earning such Performance Bonus, Executive must remain an
employee in good standing of the Company on the scheduled annual
Performance Bonus payment date in order to earn any Performance
Bonus, except as otherwise provided in Section 7 herein. For fiscal
year 2018, Executive’s Performance Bonus shall be determined
and payable, in accordance with (and subject to) the terms and
conditions of Section 2.2 (Annual
Bonus) of the Prior Agreement.

 

 

2

 

 

2.3           Equity.

 

2.3.1           Stock
Options. In consideration of Executive entering into this
Agreement, on the Effective Date, Company will grant Executive an
option (the “Promotion
Option”) under the Company’s 2017 Equity
Incentive Plan, as amended (the “Plan”) to purchase a number of
shares of the Company’s common stock (the “Common Stock”) having a value
equal to $2,000,000, with the number of shares of Common Stock
underlying the Promotion Option to be determined in accordance with
the Financial Accounting Standards Board’s Accounting
Standards Codification (FASB ASC) Topic 718, Compensation –
Stock Compensation (employing the same assumptions and
methodologies that are applied for purposes of the Company’s
financial accounting statements). The Promotion Option shall have an
exercise price equal to the Fair Market Value (as such term is
defined in the Plan) of a share of Common Stock on the date of
grant. In addition, the Promotion Option shall vest over a 3-year
period, with one-third (1/3rd) of the shares subject the Promotion
Option vesting on the one-year anniversary of the date of grant,
and the remaining shares subject to the Promotion Option vesting in
a series of twenty-four (24) equal monthly installments thereafter,
subject to Executive’s Continuous Service (as such term is
defined in the Plan) on each such vesting date. Notwithstanding the
foregoing or anything to the contrary set forth in the Plan or any
award agreement, in the event Executive’s employment with the
Company is terminated without Cause (as such term is defined below)
(and other than as a result of Executive’s death or
Disability (as such term is defined below)) or if Executive resigns
his employment for Good Reason (as such term is defined below), all
of the unvested shares of Common Stock subject to the Promotion
Option shall become immediately vested and exercisable, and shall
remain exercisable for the period as set forth in the last sentence
of Section 7.2.3 of
this Agreement. For the avoidance of doubt, the preceding sentence
applies only to the Promotion Option grant (and does not apply to
any equity grants previously made to Executive or any equity grants
that may be made in the future to Executive).

 

2.3.2           Additional
Equity. Commencing with the equity grant cycle in fiscal
year 2019, Executive shall be eligible for additional annual equity
grants in amounts commensurate with Executive’s position with
the Company, at the same times as equity is granted to other senior
level executives of the Company, in the discretion of the Board.
Executive acknowledges and agrees that Executive will not receive
any additional equity awards in fiscal year 2018 other than the
Promotion Option.

 

3.           Standard
Company Benefits. Executive shall, in accordance with
Company policy and the terms and conditions of the applicable
Company benefit plan documents, be eligible to participate in the
benefit and fringe benefit programs provided by the Company to its
senior executive officers from time to time. Any such benefits
shall be subject to the terms and conditions of the governing
benefit plans and policies and may be changed by the Company in its
discretion; provided, however, that any such benefit
plan or policy change that materially and adversely affects
Executive disproportionately and specifically compared to other
similarly situated executives of the Company shall require written
consent of Executive. Executive shall be entitled to 4 weeks of
vacation per calendar year.

 

4.           Expenses.
The Company will reimburse Executive for reasonable travel,
entertainment or other expenses incurred by Executive in
furtherance or in connection with the performance of
Executive’s duties hereunder, in accordance with the
Company’s expense reimbursement policy as in effect from time
to time. The Company will reimburse Executive for reasonable legal
fees incurred in connection with the negotiation of this Agreement,
up to a cap of $25,000.

 

5.           Proprietary
Information Obligations.

 

5.1           Proprietary
Information Agreement. As a condition of employment, and in
consideration for the benefits provided for in this Agreement,
Executive shall sign and comply with the Company’s Employee
Confidential Information and Invention Assignment Agreement (the
“Proprietary Information
Agreement”) attached hereto as Exhibit A.
 In
addition, Executive agrees to abide by the Company’s
internally published policies and procedures, as may be modified
and internally published from time to time within the
Company’s discretion.

 

 

3

 

 

5.2           Third-Party
Agreements and Information. Executive represents and
warrants that Executive’s employment by the Company does not
conflict with any prior employment or consulting agreement or other
agreement with any third party, and that Executive will perform
Executive’s duties to the Company without violating any such
agreement. Executive represents and warrants that, except as gained
in connection with Healthspan Research LLC, Executive does not
possess confidential information arising out of prior employment,
consulting, or other third party relationships, that would be used
in connection with Executive’s employment by the Company,
except as expressly authorized by that third party. During
Executive’s employment by the Company, Executive will use in
the performance of Executive’s duties only information that
is generally known and used by persons with training and experience
comparable to Executive’s own, common knowledge in the
industry, otherwise legally in the public domain, or obtained or
developed by the Company or by Executive in the course of
Executive’s work for the Company.

 

6.           Outside
Activities and Non-Competition During Employment.

 

6.1           Outside
Activities. Throughout Executive’s employment with the
Company, Executive may engage in civic and not-for-profit
activities and manage his and his family’s passive
investments, so long as such activities do not materially interfere
with the performance of Executive’s duties hereunder or
present a conflict of interest with the Company or its affiliates.
Subject to the restrictions set forth herein, and only with prior
written disclosure to and consent of the Board, Executive may
engage in other types of business or public activities. The Board
may rescind such consent, if the Board determines, in its good
faith discretion, that such activities compromise or threaten to
compromise the Company’s or its affiliates’ business
interests or conflict or compete with Executive’s duties to
the Company or its affiliates. Notwithstanding the foregoing,
Executive shall be permitted to perform outside business and other
activities, including without limitation business activities in the
film and entertainment industries, to the extent such activities do
not violate the first sentence of this Section 6.1.

 

6.2           Non-Competition
During Employment. Except as otherwise provided in this
Agreement, during Executive’s employment with the Company,
Executive will not, without the prior written consent of the Board,
directly or indirectly serve as an officer, director, stockholder,
employee, partner, proprietor, investor, joint venturer, associate,
representative or consultant of any person or entity engaged in, or
planning or preparing to engage in, business activity competitive
with any line of business engaged in (or planned to be engaged in)
by the Company; provided, however, that Executive may
purchase or otherwise acquire up to (but not more than) one percent
(1%) of any class of securities of any competitive enterprise
(without participating in the activities of such enterprise) if
such securities are listed on any national or regional securities
exchange or if Executive makes a passive investment in private
equity firms.

 

7.           Termination
of Employment; Severance.

 

7.1           At-Will
Employment. Executive’s employment relationship is
at-will. Either Executive or the Company may terminate the
employment relationship at any time, with or without Cause (as
defined below) or advance notice.

 

7.2           Termination
Without Cause; Resignation for Good Reason. In the event
Executive’s employment with the Company is terminated by the
Company without Cause (and other than as a result of
Executive’s death or Disability (as defined below)) or
Executive resigns his employment for Good Reason, then provided
such termination or resignation constitutes a “separation
from service” (as defined under Treasury Regulation Section
1.409A-1(h), without regard to any alternative definition
thereunder, a “Separation
from Service”), and provided that Executive satisfies
the Release Requirement in Section 8 below, the Company
shall provide Executive with the following “Severance Benefits”:

 

 

4

 

 

7.2.1           Severance
Payments. Severance pay in the form of continuation of
Executive’s Base Salary for a period of eighteen (18) months
following termination, subject to required payroll deductions and
tax withholdings (the “Severance Payments”). Subject to
Section 8 below,
the Severance Payments shall be made on the Company’s regular
payroll schedule in effect following Executive’s termination
date; provided,
however that any
such payments that are otherwise scheduled to be made prior to the
Release Effective Date (as defined below) shall instead accrue and
be made on the first administratively practicable payroll date
following the Release Effective Date. For such purposes,
Executive’s final Base Salary will be calculated prior to
giving effect to any reduction in Base Salary that would give rise
to Executive’s right to resign for Good Reason.

 

7.2.2           Health
Care Continuation Coverage Payments. If Executive timely
elects continued coverage under COBRA, the Company will pay
Executive’s COBRA premiums to continue Executive’s
coverage (including coverage for Executive’s eligible
dependents, if applicable) (“COBRA Premiums”) through the
period starting on the termination date and ending twelve (12)
months after the termination date (the “COBRA Premium Period”);
provided,
however, that the
Company’s provision of such COBRA Premium benefits will
immediately cease if during the COBRA Premium Period Executive
becomes eligible for group health insurance coverage through a new
employer or Executive ceases to be eligible for COBRA continuation
coverage for any reason, including plan termination. In the event
Executive becomes covered under another employer’s group
health plan or otherwise ceases to be eligible for COBRA during the
COBRA Premium Period, Executive must immediately notify the Company
of such event. The COBRA Premiums paid by the Company shall be
treated as taxable income to Executive.

 

7.2.3           Equity
Acceleration upon Termination. Except as provided in Section 2.3.1
with respect to the Promotion Option
and notwithstanding anything to the contrary set forth in the
Plan or any award agreement, effective as of
Executive’s employment termination date, the vesting and
exercisability of the then unvested time-based vesting equity
awards that would have otherwise become vested had Executive
performed Continuous Service (as that term is defined in the Plan)
through the one year anniversary of Executive’s employment
termination date then held by Executive shall accelerate and become
immediately vested and exercisable, if applicable, by Executive
upon such termination and shall remain exercisable, if applicable,
following Executive’s termination as set forth in the
applicable equity award documents. With respect to any
performance-based vesting equity award, such award shall continue
to be governed in all respects by the terms of the applicable
equity award documents. Upon any such termination, Executive shall
have three (3) years to exercise any options or stock appreciation
rights, but no later than ten (10) years from the date of grant or
the date when the options or stock appreciation rights would
otherwise terminate under the Plan other than as a result of
termination of employment (e.g., if all of the Company’s
options are accelerated and terminate if not exercised in
connection with a Change in Control (as that term is defined in the
Plan), then Executive’s options will also terminate if not
exercised in connection with the Change in Control).

 

7.2.4           Pro
Rata Bonus. Executive shall be eligible to receive, based on
the good faith determination of the Board or the Compensation
Committee thereof, a pro rata Performance Bonus based on actual
results and Executive’s period of employment during the
fiscal year in which termination occurred (the “Pro Rata Bonus”), on the date when
other bonuses are paid for the fiscal year.

 

7.2.5           No
Mitigation or Offset. Executive shall have no obligation to
mitigate the obligations hereunder, and the amounts due hereunder
shall not be offset by any amounts otherwise earned by
Executive.

  

7.3           Termination
for Cause; Resignation Without Good Reason; Death or
Disability. Executive will not be eligible for, or entitled
to any severance benefits, including (without limitation) the
Severance Benefits listed in Section 7.2 above, if the
Company terminates Executive’s employment for Cause,
Executive resigns Executive’s employment without Good Reason,
or Executive’s employment terminates due to Executive’s
death or Disability, provided that, in the case of death or
Disability termination, Executive (or Executive’s estate, in
the case of his death) shall be eligible to receive a Pro Rata
Bonus.

 

 

5

 

 

8.           Conditions
to Receipt of Severance Benefits. To be eligible for any of
the Severance Benefits pursuant to Section 7.2 above, Executive
must satisfy the following release requirement (the
“Release
Requirement”): return to the Company a signed and
dated general release of all known and unknown claims in
substantially the form attached hereto as Exhibit B
(the “Release”)
within the applicable deadline set forth therein, but in no event
later than forty-five (45) calendar days following
Executive’s termination date, and permit the Release to
become effective and irrevocable in accordance with its terms (such
effective date of the Release, the “Release Effective Date”). No
Severance Benefits will be provided hereunder prior to the Release
Effective Date. Accordingly, if Executive refuses to sign and
deliver to the Company an executed Release or signs and delivers to
the Company the Release but exercises Executive’s right, if
any, under applicable law to revoke the Release (or any portion
thereof), then Executive will not be entitled to any severance,
payment or benefit under this Agreement.

 

9.           Accrued
Amounts. On any termination, Executive shall promptly
receive earned but unpaid Base Salary, accrued but unused vacations
and unreimbursed expenses (in accordance with the Company’s
applicable expense reimbursement policies), and shall be entitled
to any amounts due under any benefit or fringe plan or program in
accordance with the provisions of the plan or program. In the event
of Executive’s termination of employment as a result of death
or Disability, by the Company without Cause, or for Good Reason,
Executive will also receive any earned but unpaid Performance Bonus
for the fiscal year prior to the date of such termination, which
shall be paid at the time such Performance Bonus would have
otherwise been paid under Section 2.2 of this
Agreement.

 

10.           Section
409A. It is intended that all of the severance benefits and
other payments payable under this Agreement satisfy, to the
greatest extent possible, the exemptions from the application of
Code Section 409A provided under Treasury Regulations
1.409A-1(b)(4), 1.409A-1(b)(5) and 1.409A-1(b)(9), and this
Agreement will be construed to the greatest extent possible as
consistent with those provisions, and to the extent not so exempt,
this Agreement (and any definitions hereunder) will be construed in
a manner that complies with Section 409A. For purposes of Code
Section 409A (including, without limitation, for purposes of
Treasury Regulation Section 1.409A-2(b)(2)(iii)), Executive’s
right to receive any installment payments under this Agreement
(whether severance payments, reimbursements or otherwise) shall be
treated as a right to receive a series of separate payments and,
accordingly, each installment payment hereunder shall at all times
be considered a separate and distinct payment. Any reference to
termination or similar words shall mean a separation from service
under the meaning of Code Section 409A. Notwithstanding any
provision to the contrary in this Agreement, if Executive is deemed
by the Company at the time of Executive’s Separation from
Service to be a “specified employee” for purposes of
Code Section 409A(a)(2)(B)(i), and if any of the payments upon
Separation from Service set forth herein and/or under any other
agreement with the Company are deemed to be “deferred
compensation”, then to the extent delayed commencement of any
portion of such payments is required in order to avoid a prohibited
distribution under Code Section 409A(a)(2)(B)(i) and the related
adverse taxation under Section 409A, such payments shall not be
provided to Executive prior to the earliest of (i) the expiration
of the six-month and one day period measured from the date of
Executive’s Separation from Service with the Company, (ii)
the date of Executive’s death or (iii) such earlier date as
permitted under Section 409A without the imposition of adverse
taxation. Upon the first business day following the expiration of
such applicable Code Section 409A(a)(2)(B)(i) period, all payments
deferred pursuant to this Section 10 shall be paid in a
lump sum to Executive, and any remaining payments due shall be paid
as otherwise provided herein or in the applicable agreement. No
interest shall be due on any amounts so deferred. If any severance
benefits provided under this Agreement constitute “deferred
compensation” under Section 409A, for purposes of determining
the schedule for payment of the severance benefits, the effective
date of the Release will be the sixtieth (60th) date following the
Separation From Service, regardless of when the Release actually
becomes effective. To the extent required to avoid accelerated
taxation and/or tax penalties under Code Section 409A, amounts
reimbursable to Executive under this Agreement shall be paid to
Executive on or before the last day of the year following the year
in which the expense was incurred, amounts shall not be subject to
liquidation or exchange for another benefit, and the amount of
expenses eligible for reimbursement (and in-kind benefits provided
to Executive) during any one year may not effect amounts
reimbursable or provided in any subsequent year. The Company makes
no representation that any or all of the payments described in this
Agreement will be exempt from or comply with Code Section
409A.

 

6

 

 

11.             Section
280G; Limitations on Payment.

 

11.1           If
any payment or benefit Executive will or may receive from the
Company or otherwise (a “280G
Payment”) would (i) constitute a “parachute
payment” within the meaning of Section 280G of the Code, and
(ii) but for this sentence, be subject to the excise tax
imposed by Section 4999 of the Code (the “Excise Tax”), then any such 280G
Payment provided pursuant to this Agreement (a “Payment”) shall be equal to the
Reduced Amount. The “Reduced
Amount” shall be either (x) the largest portion
of the Payment that would result in no portion of the Payment
(after reduction) being subject to the Excise Tax or (y) the
largest portion, up to and including the total, of the Payment,
whichever amount (i.e., the amount determined by clause (x) or by
clause (y)), after taking into account all applicable federal,
state and local employment taxes, income taxes, and the Excise Tax
(all computed at the highest applicable marginal rate), results in
Executive’s receipt, on an after-tax basis, of the greater
economic benefit notwithstanding that all or some portion of the
Payment may be subject to the Excise Tax. If a reduction in a
Payment is required pursuant to the preceding sentence, the
reduction shall occur in the manner (the “Reduction Method”) that results in
the greatest after tax economic benefit for Executive. If more than
one method of reduction will result in the same after tax economic
benefit, the items so reduced will be reduced pro rata (the
“Pro Rata Reduction
Method”).

 

11.2           Notwithstanding
any provision of Section 11.1 to the
contrary, if the Reduction Method or the Pro Rata Reduction Method
would result in any portion of the Payment being subject to taxes
pursuant to Section 409A that would not otherwise be subject to
taxes pursuant to Section 409A, then the Reduction Method and/or
the Pro Rata Reduction Method, as the case may be, shall be
modified so as to avoid the imposition of taxes pursuant to Section
409A as follows: (A) as a first priority, the modification
shall preserve to the greatest extent possible, the greatest after
tax economic benefit for Executive as determined on an after-tax
basis; (B) as a second priority, Payments that are contingent
on future events (e.g.,
being terminated without Cause), shall be reduced (or eliminated)
before Payments that are not contingent on future events; and
(C) as a third priority, Payments that are “deferred
compensation” within the meaning of Section 409A shall be
reduced (or eliminated) before Payments that are not deferred
compensation within the meaning of Section 409A.

 

11.3           Unless
Executive and the Company agree on an alternative accounting firm
or law firm, the accounting firm engaged by the Company for general
tax compliance purposes as of the day prior to the effective date
of the Change in Control transaction shall perform the foregoing
calculations. If the accounting firm so engaged by the Company is
serving as accountant or auditor for the individual, entity or
group effecting the Change in Control transaction, the Company
shall appoint a nationally recognized accounting or law firm to
make the determinations required by this Section 11. The Company shall
bear all expenses with respect to the determinations by such
accounting or law firm required to be made hereunder. The Company shall use commercially reasonable
efforts to cause the accounting or law firm engaged to make the
determinations hereunder to provide its calculations, together with
detailed supporting documentation, to Executive and the Company within fifteen (15) calendar days
after the date on which Executive’s right to a 280G Payment becomes reasonably likely
to occur (if requested at that time by Executive
or the Company) or such other time as
requested by Executive or the
Company.

 

 

7

 

 

11.4           If
Executive receives a Payment for which the Reduced Amount was
determined pursuant to clause (x) of Section 11.1 and the Internal
Revenue Service determines thereafter that some portion of the
Payment is subject to the Excise Tax, Executive agrees, to the
extent not in violation of the Sarbanes-Oxley Act, to promptly
return to the Company a sufficient amount of the Payment (after
reduction pursuant to clause (x) of Section 11.1) so that no
portion of the remaining Payment is subject to the Excise Tax. For
the avoidance of doubt, if the Reduced Amount was determined
pursuant to clause (y) of Section 11.1, Executive shall
have no obligation to return any portion of the Payment pursuant to
the preceding sentence.

  

12.           Definitions.

 

12.1           Cause.
For the purposes of this Agreement, “Cause” means the occurrence of any
one or more of the following: (a) Executive’s conviction of
or plea of guilty or nolo
contendere to any felony (other than traffic violations);
(b) Executive’s willful and continued failure or refusal to
follow lawful and reasonable instructions of the Board or lawful,
reasonable, material and internally published policies and
regulations of the Company or its affiliates; (c) Executive’s
willful and continued failure to perform the assigned duties of
Executive’s employment with the Company or its affiliates;
(d) unethical or fraudulent conduct by Executive in connection with
the performance of Executive’s duties for the Company or its
affiliates; (e) conduct by Executive that materially discredits the
Company or any affiliate or that is materially detrimental to the
reputation, character and standing of the Company or any affiliate;
or (f) Executive’s material breach of this Agreement or the
Proprietary Information Agreement. An event described in
clauses (b) through
(f) shall not be treated as “Cause” until after
Executive has been given written notice of such event, failure,
conduct or breach, and Executive fails to cure such event, failure,
conduct or breach within 30 days from such written notice;
provided,
however, that such
30-day cure period shall not be required if the event, failure,
conduct or breach is incapable of being cured.

 

12.2           Good
Reason. For purposes of this
Agreement, Executive shall have “Good Reason” for resignation from
employment with the Company if any of the following actions are
taken by the Company without Executive’s prior written
consent: (a) a reduction in Executive’s Base Salary, other
than as permitted by Section 2.1 of this Agreement;
(b) a material reduction in Executive’s duties (including
responsibilities and/or authorities) or reporting structure; (c)
relocation of Executive’s principal place of employment to a
place that increases Executive’s one-way commute by more than
thirty (30) miles as compared to Executive’s then-current
principal place of employment immediately prior to such relocation;
(d) during Executive’s employment under this Agreement, the
Company’s failure to nominate Executive for continued service
on the Board each time that Executive’s service on the Board
would otherwise terminate, unless such failure is required in order
to comply with legal, stock exchange or other regulatory
requirements relating to Board or committee composition; or (e) a
material breach of this Agreement by the Company. In order for
Executive to resign for Good Reason, each of the following
requirements must be met: (w) Executive must provide written notice
to the Board within sixty (60) days after the first occurrence of
the event giving rise to Good Reason setting forth the basis for
Executive’s resignation, (x) Executive must allow the Company
at least thirty (30) calendar days from receipt of such written
notice to cure such event, (y) such event is not reasonably cured
by the Company within such thirty (30) calendar day period (the
“Cure Period”),
and (z) Executive must resign from all positions Executive then
holds with the Company and any affiliate not later than thirty (30)
calendar days after the expiration of the Cure Period.

 

 

8

 

 

12.3           Disability.
For purposes of this Agreement, “Disability” means that Executive
is unable to perform the essential functions of his position
(notwithstanding the provision of any reasonable accommodation) by
reason of any medically determinable physical or mental impairment
which has lasted for a period of ninety (90) or more consecutive
days or one hundred and twenty (120) days during any consecutive
six (6) month period, as determined by a physician to be selected
by the Company in good faith and reasonably acceptable to
Executive.

 

13.           Dispute
Resolution. To ensure the rapid and economical resolution of
disputes that may arise in connection with Executive’s
employment with the Company, Executive and the Company agree that
any and all disputes, claims, or causes of action, in law or
equity, including but not limited to statutory claims, arising from
or relating to the enforcement, breach, performance, or
interpretation of this Agreement, Executive’s employment with
the Company, or the termination of Executive’s employment
with the Company, will be resolved pursuant to the Federal
Arbitration Act, 9 U.S.C. §1-16, and to the fullest extent
permitted by law, by final, binding and confidential arbitration
conducted in Irvine, California by JAMS, Inc. (“JAMS”) or its successors by a
single arbitrator. Both Executive and the
Company acknowledge that by agreeing to this arbitration procedure,
they each waive the right to resolve any such dispute through a
trial by jury or judge or administrative
proceeding. Any
such arbitration proceeding will be governed by JAMS’ then
applicable rules and procedures for employment disputes, which will
be provided to Executive upon request. In any such proceeding, the
arbitrator shall: (i) have the authority to compel adequate
discovery for the resolution of the dispute and to award such
relief as would otherwise be permitted by law; and (ii) issue a
written arbitration decision including the arbitrator’s
essential findings and conclusions and a statement of the award.
Executive and the Company each shall be entitled to all rights and
remedies that either would be entitled to pursue in a court of law.
Nothing in this Agreement is intended to prevent either the Company
or Executive from obtaining injunctive relief in court to prevent
irreparable harm pending the conclusion of any such arbitration
pursuant to applicable law. The Company shall pay all filing fees
in excess of those which would be required if the dispute were
decided in a court of law, and shall pay the arbitrator’s
fees and any other fees or costs unique to arbitration. The parties
shall pay their own legal fees. Any awards or orders in such
arbitrations may be entered and enforced as judgments in the
federal and state courts of any competent
jurisdiction.

 

14.           General
Provisions.

 

14.1           Notices.
Any notices provided must be in writing and will be deemed
effective upon the earlier of personal delivery (including personal
delivery by fax) or the next business day after sending by
overnight carrier, to the Company at its primary office location
and to Executive at the address as listed on the Company
payroll.

 

14.2           Severability.
Whenever possible, each provision of this Agreement will be
interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to
be invalid, illegal or unenforceable in any respect under any
applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision
or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction to the extent possible
in keeping with the intent of the parties.

 

14.3           Waiver.
Any waiver of any breach of any provisions of this Agreement must
be in writing to be effective, and it shall not thereby be deemed
to have waived any preceding or succeeding breach of the same or
any other provision of this Agreement.

 

9

 

 

14.4           Complete
Agreement. This Agreement, together with the Proprietary
Information Agreement, the Indemnity Agreement, dated as of
December 13, 2016, between the Company and Executive (the
“Indemnity
Agreement”), the Purchase Agreement (as such term is
defined in the Prior Agreement), with respect to Sections 5.4(a)
and Section 5.4(b) therein only, and to the extent referenced in
this Agreement, the Plan, constitutes the entire agreement between
Executive and the Company with regard to the subject matter hereof
and is the complete, final, and exclusive embodiment of the
Company’s and Executive’s agreement with regard to this
subject matter; provided, however, that any of
Executive’s rights to receive performance stock under Section
2.3.4 (Performance Stock)
of the Prior Agreement shall survive and remain enforceable in
accordance with the applicable terms of the Prior Agreement;
provided,
further, that any
of Executive’s rights as a holder of options to acquire
shares of Common Stock existing immediately prior to the Effective
Date shall survive and remain enforceable in accordance with the
terms of the applicable agreements. This Agreement is entered into
without reliance on any promise or representation, written or oral,
other than those expressly contained herein, and it supersedes and
replaces any other agreements or promises made to Executive by
anyone concerning Executive’s employment terms, compensation
or benefits, whether oral or written, including but not limited any
agreements or promises with or from the Company or any of its
affiliates or predecessors and the Prior Agreement, except as
otherwise expressly set forth in the prior sentence. It cannot be
modified or amended except in a writing signed by a duly authorized
officer of the Company, with the exception of those changes
expressly reserved to the Company’s discretion in this
Agreement.

 

14.5           Counterparts.
This Agreement may be executed in separate counterparts, any one of
which need not contain signatures of more than one party, but both
of which taken together will constitute one and the same
Agreement.

 

14.6           Headings.
The headings of the sections hereof are inserted for convenience
only and shall not be deemed to constitute a part hereof nor to
affect the meaning thereof.

  

14.7           Successors
and Assigns. This Agreement is intended to bind and inure to
the benefit of and be enforceable by Executive and the Company, and
their respective successors, assigns, heirs, executors and
administrators, except that Executive may not assign any of
Executive’s duties hereunder, Executive may not assign any of
Executive’s rights hereunder without the written consent of
the Company, which shall not be withheld unreasonably, and the
Company may not assign this Agreement, except to a successor in
connection with a Change in Control (as that term is defined in the
Plan), who assumes this Agreement in writing.

 

14.8           Tax
Withholding. All payments and awards contemplated or made
pursuant to this Agreement will be subject to withholdings of
applicable taxes in compliance with all relevant laws and
regulations of all appropriate government authorities. Executive
acknowledges and agrees that the Company has neither made any
assurances nor any guarantees concerning the tax treatment of any
payments or awards contemplated by or made pursuant to this
Agreement. Executive has had the opportunity to retain a tax and
financial advisor and fully understands the tax and economic
consequences of all payments and awards made pursuant to this
Agreement.

 

14.9           Choice
of Law. All questions concerning the construction, validity
and interpretation of this Agreement will be governed by the laws
of the State of California.

 

 

 

[Signature page follows]

 

 

10

 

In Witness
Whereof, this Agreement shall be effective as of the
Effective Date.

 

 

	
 

	

 

ChromaDex Corporation

 

 

By: /s/ Mark
Friedman                 

     
Name: Mark Friedman

     
Title: General Counsel and Secretary

 

 

Executive

 

/s/ Robert Fried

Robert Fried

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