Document:

EXHIBIT 10.12

SEPARATION AGREEMENT AND RELEASE

This Separation Agreement and Release (the "Agreement") is dated as of October 2, 2018 by and between Tandy Leather Factory, Inc., a Delaware Corporation (the "Company"), and Mark Angus (the "Executive").

WHEREAS, Executive has been serving as interim President of the Company since February 9, 2016 before the interim designation was removed on June 6, 2016;

WHEREAS, Executive has been serving as an Inside Director on the Company's Board of Directors (the "Board") since 2009;

WHEREAS, Executive has resigned as President effective October 2, 2018;

WHEREAS, the Company has accepted Executive's resignation as President;

WHEREAS, Executive wishes to resign as Inside Director;

WHEREAS, the Board wishes to accept Executive's resignation as Inside Director;

WHEREAS, the Executive and the Company (collectively, the "Parties") desire to resolve amicably all matters between them on a full and final basis;

WHEREAS, the Parties hereto regard the representations by each set forth herein as material and that each Party is relying on these representations in entering into this Agreement;

NOW THEREFORE, expressly incorporating the foregoing recitals as part of the consideration hereof and in further consideration of the mutual terms and conditions herein, intending to be legally bound, the Parties agree as follows

1. Voluntary Resignation From Company.  Executive has tendered, and the Company has accepted, Executive's resignation as President (and any other office or position) of the Company effective as of October 2, 2018 (the "Separation Date").  Executive will no longer occupy any positions as an employee, officer, director, manager or board member for the Company or any of its subsidiaries or affiliates, in each case, effective as of the Separation Date.  The Separation Date shall be the last day of Executive's employment for all purposes.  Except as specifically provided herein, participation in and coverage under all employee benefit plans, programs, and perquisites sponsored by or through the Company, its parents, and its subsidiaries shall terminate in accordance with the generally applicable provisions of such plans or programs, subject to any conversion or continuation rights provided by the terms of such plans or programs or applicable law.

2. Voluntary Resignation From Board.  Upon execution of this Agreement, Executive will sign the resignation letter attached hereto as Exhibit A and promptly submit it to the Board.  If further action is necessary to effectuate Executive's resignation from the Board, Executive will take whatever reasonable steps are necessary to effectuate his resignation from the Board.

3. Accrued but Unpaid Compensation and Reimbursable Expenses.  The Company shall pay Executive for all salary earned, but not paid through the Separation Date, less any applicable taxes and deductions, no later than the next regularly scheduled payday following the Separation Date. The Company also shall reimburse Executive for any unreimbursed business expenses properly incurred by Executive prior to the Separation Date and submitted for reimbursement in accordance with the Company's applicable reimbursement policy.

4. Severance Benefits.  In consideration for Executive's signing and non-revocation of this Agreement and his compliance with the terms thereof, including his compliance with the Post-Employment Restrictive Covenants provision contained in Section 10, the Confidentiality and Nondisclosure provision contained in Section 11, and the Full Release contained in Section 6 herein, the Company shall provide Executive with the following benefits (the "Severance Benefits"):

(a) The Company shall pay Executive a gross salary at the rate of twenty-five thousand dollars ($25,000.00) per month for seven (7) months following the Separation Date, less applicable taxes and deductions ("Severance Payment").  The Severance Payment shall be payable as salary continuation in accordance with the Company's regular payroll practices, starting on the Company's first payroll date following the eighth (8th) day after Executive signs this Agreement.

(b) Subject to Executive's timely election of continuation of coverage for the Executive (and, to the extent covered immediately prior to the Separation Date, his spouse and dependents) under the Company's health plans pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended ("COBRA"), the Company shall reimburse Executive for all COBRA premiums paid for coverage during the twelve (12) months following the Separation Date, unless Executive shall have secured group medical coverage through another employer before the end of twelve (12) months, at which earlier point the Company's obligation to reimburse Executive for premiums shall cease.  The Company's obligation to reimburse Executive for COBRA premiums is subject to Executive providing documentation of premiums paid.

(c) Effective as of the Separation Date, the Company will:

		(i)	
Exercise its discretion pursuant to the Restricted Stock Agreement between Executive and the Company (the "2016 Stock Agreement") to immediately accelerate the vesting of all unvested shares of Restricted Stock granted to Executive in the 2016 Stock Agreement and held by Executive as of the Separation Date.  Any remaining unvested stock granted to Executive in the 2016 Stock Agreement will be forfeited pursuant to Section 8(b) of the 2016 Stock Agreement.

		(ii)	
Exercise its discretion pursuant to Restricted Stock Agreement between Executive and the Company (the "2015 Stock Agreement") to immediately accelerate the vesting of all unvested shares of Restricted Stock granted to Executive in the 2015 Stock Agreement and held by Executive as of the Separation Date.  Any remaining unvested stock granted to Executive in the 2015 Stock Agreement will be forfeited pursuant to Section 8(b) of the 2015 Stock Agreement.

(d) The Company will also provide Executive with the following:

		(i)	
Promptly following the execution of this Agreement, the Company will pay to the Executive the amount of $10,000 in lieu of any vacation time that the Executive may have accrued but not used during the term of Executive's employment; and

		(ii)	
The Company shall pay (directly to an agreed-upon firm) the out-of-pocket cost for up to 12 months of outplacement services for the Executive to obtain new employment, up to a maximum aggregate of $12,500.

5. Clawback.  If Executive revokes or materially breaches the Agreement as determined by an arbitrator in accordance with Section 12 below, including but not limited to Section 9, Section 10 and Section 11, Executive shall be liable to the Company for the value of the Severance Benefits, including the value of any shares of Restricted Stock that vested according to the terms of Section 4(c) of this Agreement.  The Board will determine, in its sole discretion, the method for recouping the Severance Benefits which may include, without limitation: (i) requiring reimbursement of cash Severance Benefits previously paid; (ii) seeking recovery of any gain realized on the vesting, exercise, settlement, sale, transfer or other disposition of any equity-based awards; and/or (iii) taking any other remedial and recovery action permitted by law, as determined by the Board.  Any right of recoupment under this Agreement is in addition to, and not in lieu of, any other remedies or rights of recoupment that may be available to the Company.  Notwithstanding the foregoing, the first one thousand dollars ($1,000) paid in cash Severance Benefits shall be exempt from recoupment under this Agreement.  The Parties agree that this $1,000 payment is fair and adequate consideration for the Full Release in Section 6 of this Agreement, including the release of claims under the Age Discrimination in Employment Act (as amended by the Older Workers Benefit Protection Act).

6. Full Release.  (a)  As a condition to the benefits afforded Executive hereunder and in consideration of the Severance Benefits, which the Parties agree is fair and adequate consideration, Executive, for himself, his heirs, executors, administrators, successors and assigns (hereinafter collectively referred to as the "Releasors"), hereby irrevocably, unconditionally and fully releases, acquits, and discharges the Company, its directors, officers, board members, committees, affiliates, insurers, predecessors, successors, and assigns, and their respective predecessors, parents, affiliates, subsidiaries, divisions, committees, equityholders, members, managers, partners, officers, directors, employees, legal advisors, representatives, trustees, benefits plans, lenders, investors and agents (all such persons, firms, corporations and entities are referred to herein as the "Company Entities") from any and all actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, bonuses, pro-rata bonuses, retention bonuses, severance pay, severance benefits, cash equivalent payments for benefits, controversies, agreements, liabilities, promises, claims, obligations, costs, losses, damages and demands of whatsoever character, in law or in equity, whether or not known, suspected or claimed, which the Releasors ever had, have, or may have from the beginning of time through the date of Executive's execution of this Agreement, against the Company Entities arising out of or in any way related to Executive's employment, service, board membership, or affiliation with the Company Entities, or the termination of his employment, service, or affiliation, including, but not limited to, claims arising under any employment agreement, as well as claims arising under the Americans With Disabilities Act, the Age Discrimination in Employment Act (as amended by the Older Workers Benefit Protection Act), the National Labor Relations Act, the Fair Labor Standards Act, the Employee Retirement Income Security Act of 1974, the Equal Pay Act, the Fair Credit Reporting Act, the Genetic Information and Discrimination Act, Title VII of the Civil Rights Act of 1964, as amended, the Civil Rights Acts of 1866, 1871 and 1991, including Section 1981-1988 of the Civil Rights Act, the Labor Management Relations Act, the Vietnam Era Veterans Readjustment Act of 1974, the Rehabilitation Act of 1973, the Worker Adjustment and Retraining Notification Act, Section 806 of the Corporate and Criminal Fraud Accountability Act of 2002, the Immigration Reform Control Act, the Occupational Safety and Health Act, the Family and Medical Leave Act, any and all claims under Texas statutory or common law, including but not limited to claims brought under the Texas Commission on Human Rights Act, the Texas Labor Code, and the Texas Pay Day Law, each as may be amended, and/or any other federal, state, district or local human rights, civil rights, wage-hour, pension, employment, labor or other law, rule, statute, regulation, constitution or ordinance and/or public policy, contract or tort law, or any claim of retaliation under such laws, or any claim of breach of any contract (whether express, oral, written or implied from any source), or any claim of intentional or negligent infliction of emotional distress, tortious interference with contractual relations, wrongful or abusive discharge, discrimination, defamation, prima facie tort, fraud, negligence, loss of consortium, or any action similar thereto against the Company Entities, including any claim for attorneys' fees; provided, however, that the Releasors do not waive any rights or release the Company Entities from (i) its obligations to Executive pursuant to this Agreement, including those set forth on Exhibit A; (ii) any COBRA (or similar district mandated) continuation coverage rights under applicable law (which will be paid for, if elected, by the Company); (iii) indemnification or directors' and officers' insurance rights Executive may have in respect of his service to the Company; and (iv) vested benefits, if any, of Executive under the terms of any employee benefit plan; and further provided, that the Releasors do not release any right to challenge, under the Older Worker's Benefit Protection Act, the knowing and voluntary nature of the release of any age claims in this Agreement, in court or before the Equal Employment Opportunity Commission ("EEOC") or any right to file an administrative charge with the EEOC or any other federal, state, or local agency (provided, that any right to recover monetary damages in any such proceeding shall be released and waived), or any claims that cannot be waived by law, including unemployment benefit rights and workers' compensation.

(b) For a period of three years following the Separation Date, the Company shall maintain comparable levels of Directors and Officers Insurance coverage as existed as of the Separation Date with respect to the periods of Executive's service to the Company.  In addition, unless otherwise required by law or regulation, for a period of three years following the Separation Date, the Company shall maintain its policies of indemnification of Directors and Officers as existed as of the Separation Date with respect to Executive's service to the Company.  The foregoing shall not preclude the Company from making changes to its insurance coverage or indemnification policies to the extent such changes would be applicable to all then-current Directors and Executive Officers of the Company.

7. Intellectual Property.  Executive agrees that any Inventions made, conceived, or completed by Executive during the term of Executive's service, solely or jointly with others, which are made with the Company's equipment, supplies, facilities, or Confidential Information, or which relate at the time of conception or reduction to purpose of the Invention, to the business of the Company, or the Company's actual or demonstrably anticipated research and development, or which result from any work performed by Executive for the Company, will be the sole and exclusive property of the Company, and all Trade Secrets, Confidential Information, copyrightable works, works of authorship, and all patents, registrations, or applications related thereto, all other intellectual property or proprietary information and all similar or related information (whether or not patentable and copyrightable and whether or not reduced to tangible form or practice) which relate to the business, research and development, or existing or future products or services of the Company and/or its subsidiaries and which are conceived, developed, or made by Executive during Executive's employment with the Company ("Work Product") will be deemed to be "work made for hire" (as defined in the Copyright Act, 17 U.S.C. §101 et seq., as amended) and owned exclusively by the Company.  To the extent that any Work Product is not deemed to be a "work made for hire" under applicable law, and all right, title, and interest in and to such Work Product have not automatically vested in the Company, Executive hereby (a) irrevocably assigns, transfers, and conveys, and will assign, transfer, and convey, to the fullest extent permitted by applicable law, all right, title, and interest in and to the Work Product on a worldwide basis to the Company (or such other person or entity as the Company may designate), without further consideration; and (b) waives all moral rights in or to all Work Product, and to the extent such rights may not be waived, agrees not to assert such rights against the Company or its respective licensees, successors, or assigns.  In order to permit the Company to claim rights to which it may be entitled, Executive agrees to promptly disclose to the Company in confidence all Work Product which Executive makes arising out of Executive's employment with the Company.  During the Restricted Period, Executive will assist the Company in obtaining patents on all Work Product patentable by the Company in the United States and in all foreign countries, and will execute all documents and do all things reasonably necessary to obtain letters patent, to vest the Company with full and extensive title thereto, and to protect the same against infringement by others.

8. By executing this Agreement, Executive acknowledges that:

(a) This Agreement does not include claims arising after the Execution Date of this Agreement and shall be effective as of such Execution Date;

(b) Executive acknowledges that he has had twenty-one (21) days to consider this Agreement's terms (commencing from delivery hereof).  Executive may accept this Agreement by signing it and returning it to Scott Barnard, Akin Gump Strauss Hauer & Feld LLP, 1700 Pacific Avenue, Suite 4100, Dallas, Texas 75201;

(c) Executive understands that on the eighth (8th) day after the date of execution of this Agreement, this Agreement becomes effective and, as of that date, Executive may not change his decision or seek any other remuneration in any form; provided, however, that he has a seven (7) day revocation period (beginning on the date of execution) that expires at 5:00 pm on such seventh (7th) day.  If Executive intends to revoke this Agreement, he must advise Scott Barnard, Akin Gump Strauss Hauer & Feld LLP, 1700 Pacific Avenue, Suite 4100, Dallas, Texas 75201, on or before the expiration of this seven (7) day revocation period by delivering to Scott Barnard at Akin Gump Strauss Hauer & Feld LLP, 1700 Pacific Avenue, Suite 4100, Dallas, Texas 75201, written notification of his intention to revoke this Agreement, which written notification makes specific reference to this Agreement;

(d) By signing this Agreement, Executive acknowledges that he has had a full and fair opportunity to review, consider and negotiate the terms of this release and this Agreement, that he has been advised to seek advice of an independent attorney of his choosing in connection with his decision whether to accept the benefits that have been offered to him under this Agreement, that he has read and understands this Agreement, and that he has signed this Agreement freely and voluntarily, without duress, coercion or undue influence and with full and free understanding of its terms.  Moreover, should any provision of this Agreement require interpretation or construction, it is agreed by the Parties that the entity interpreting or construing this Agreement shall not apply a presumption against one Party by reason of the rule of construction that a document is to be construed more strictly against the Party who prepared the document;

(e) The Agreement is not intended, and shall not be construed, as an admission that any of the Parties has violated any federal, state, district or local law (statutory or decisional), ordinance or regulation, breached any contract or committed any wrong whatsoever;

(f) For the purpose of implementing a full, knowing and complete release and discharge of the Company Entities, Executive expressly acknowledges that this Agreement is intended to include in its effect, without limitation, all claims which Executive does not know or suspects to exist in his favor at the time of execution hereof, and that this Agreement contemplates the extinguishment of any such claim or claims;

(g) Executive represents that neither he nor any person acting on his behalf has filed or caused to be filed any lawsuit, complaint, or charge against any of the Company Entities in any court, any municipal, state or federal agency, or any other tribunal.  Executive agrees that he will not, to the fullest extent permitted by law, sue or file a complaint, grievance or demand for arbitration in any forum pursuing any claim released under this Agreement or assist or otherwise participate in any claim, arbitration, suit, action, investigation or other proceeding of any claim released hereunder; provided, however, that Executive does not waive, release or discharge any right to file a charge or participate in any manner in an investigation, hearing, or proceeding by the EEOC or any other federal, state, or local agency (provided, that any right to recover monetary damages in any such proceeding shall be released and waived);

(h) Executive represents and warrants that he has not assigned or conveyed to any other person or entity any part of or interest in any of the claims released in this Agreement.  Executive further expressly waives any claim to any monetary or other damages or any other form of recovery in connection with any claim released in this release or any proceeding that violates this Agreement;

(i) Executive affirms that he has not suffered any known workplace injuries or occupational diseases and that he has not been retaliated against for reporting any allegations of wrongdoing by the Company or its subsidiaries or affiliates, or their respective officers or board members, including any allegations of corporate fraud.

9. Nondisparagement.  Executive represents and warrants that he will refrain from making any negative, false, disparaging or misleading statements to any other person or entity regarding the Company or its agents, including, without limitation, any employee, officer, director or executive of the Company.

10. Post-Employment Restrictive Covenants.   In exchange for the consideration set forth in this Agreement, Executive's post-employment restrictive covenants regarding unfair competition are set forth in this Section 10.

(a)  Non-Competition.  Executive agrees that the Executive will not, for a period beginning on the Separation Date and ending seven (7) months later (the "Restricted Period"), enter into or maintain an employment, contractual, or other business relationship, either directly or indirectly, with Ivan Leathercraft Co., LTD or any of its subsidiaries or affiliates.

(b) Non-Solicitation Covenants.  During the "Restricted Period" Executive shall not directly or indirectly:

a. Solicit, induce, recruit, or otherwise cause (regardless of which party initiated initial contact) any current subcontractors, clients, customers, vendors, or suppliers of the Company or its Affiliates to cease or otherwise modify its doing business, in whole or in part, with or through the Company or its affiliates; or

b. Solicit, induce, encourage, target, or otherwise cause (regardless of which party initiated initial contact) any employee of the Company or its affiliates to: (i) leave the Company's or its affiliates' employ; (ii) deviate from full-time employment and devotion of full-time effort in such employee's employment with the Company or its affiliates; or (iii) otherwise directly or indirectly, own, manage, operate, control, be employed by, perform any services for, consult with, solicit business for, participate in, or be connected with the ownership, management, operation, or control of any business, other than that of the Company and its affiliates, or assist any person, in any manner, in so doing. Notwithstanding the foregoing, general solicitations not specifically targeting such restricted employees (such as through the placing of a classified ad in a newspaper) shall not be a breach of this provision.

(c) Executive acknowledges that if the Executive were to breach any of the covenants in this Section 10, such breach would result in immediate and irreparable harm to Company, its parents, subsidiaries, affiliates or related entities that cannot be adequately or reasonably compensated at law.  Notwithstanding any other provisions in this Agreement to the contrary, should the Company determine that Executive violated any of the terms of Section, any and all remaining Severance Benefits from Company to Executive shall cease as of the date of such determination by the Company and the Severance Benefits provided to Executive would be subject to clawback pursuant to Section 5.

11. Confidentiality and Nondisclosure.  Executive agrees to comply with the terms of the Confidentiality and Trade Secret Agreement that he previously signed (the "Confidentiality Agreement"), the terms of which are hereby expressly incorporated by reference.  The terms of the Confidentiality Agreement shall survive the termination of Executive's employment.  Executive represents and warrants that Executive has delivered to the Company all originals and all duplicates and/or copies of all documents, records, notebooks, and similar repositories of or containing confidential information or subject matter in Executive's possession, whether prepared by Executive or not.  Executive will not disclose, use, or otherwise trade on any confidential, proprietary, or trade secret information of the Employer.  Executive further agrees that he will not disclose, or cause to be disclosed in any way, the terms of this Agreement or the fact that this Agreement exists, except for the purpose of enforcing this Agreement, should that ever be necessary.  This provision does not prohibit Executive from providing this information on a confidential and privileged basis to his current spouse or to his attorneys, tax or financial advisors or insurers, so long as he ensures that these parties maintain the strict confidentiality of the Agreement.  Executive may also reveal information relating to this Agreement in response to any court order or subpoena or other direction by a court or administrative agency mandating such disclosure.

12. Arbitration.  Any dispute, controversy or claim arising out of or related to in any way to the Parties' employment relationship or termination of that relationship, including this Agreement or any breach of this Agreement, shall be submitted to and decided by binding arbitration in Tarrant County, Texas.  Arbitration shall be administered under the laws of the American Arbitration Association ("AAA") in accordance with the AAA Employment Arbitration Rules in effect at the time the arbitration is commenced.  The arbitration shall be conducted by a single arbitrator, who shall be an attorney who specializes in the field of employment law and who shall have prior experience arbitrating employment disputes.  The award of the arbitrator shall be final and binding on the parties, and judgment on the award may be confirmed and entered in any state or federal court.  In the event of any court proceeding to challenge or enforce an arbitrator's award, the Parties hereby consent to the exclusive jurisdiction of the courts in the State of Texas and agree to venue in that jurisdiction.  The Parties shall split the costs of any such arbitrator, who shall have the authority to award reasonable attorneys' fees and expenses to the prevailing Party (including any share of the fees and expenses for such arbitrator), provided, that, the Company will pay the costs of any arbitrator if it is a condition precedent to enforcing this arbitration obligation.

13. Return of Company Property.  The Executive agrees that within a reasonable time following the execution of this Agreement, the Executive shall return or shall have returned all property of the Company, including, but not limited to, Company issued/owned phones, iPads, computers, laptops, peripheral electronic equipment (e.g., printers, cameras, projectors, computer docking stations, etc.), Blackberry or other personal digital assistants (PDAs), credit cards, keys, door cards, tools, equipment on loan, and any other Company books, manuals, and journals.  The Company shall use reasonable efforts to assist the executive to collect personal items located in the Company's office and to obtain contact files and other electronic files determined to be solely personal that reside on Company systems used by the Executive during Executive's term of employment.

14. Miscellaneous.

(a) This Agreement shall be construed and enforced in accordance with, and the validity and performance hereof shall be governed by, the laws of the State of Texas, excluding Texas's choice-of-law principles.

(b) Nothing in this Agreement is intended to prohibit, or shall be interpreted to prohibit, Executive from reporting possible violations of federal law or regulation to any governmental agency or entity, including but not limited to the Department of Justice, the Securities and Exchange Commission, the Congress, and any agency Inspector General, or making other disclosures that are protected under the whistleblower provisions of federal law or regulation.

(c) If any term or provision of this Agreement (or any portion thereof) is determined by an arbitrator or a court of competent jurisdiction to be invalid, illegal, or incapable of being enforced, all other terms and provisions of this Agreement shall nevertheless remain in full force and effect.  Upon a determination that any term or provision (or any portion thereof) is invalid, illegal, or incapable of being enforced, the Company and Executive agree that an arbitrator or reviewing court shall have the authority to "blue pencil," modify or reform this Agreement (or the Employment Agreement) so as to render it enforceable and effect the original intent of the Parties to the fullest extent permitted by applicable law.

(d) This Agreement may be executed in identical counterparts, which together shall constitute a single agreement.  Facsimile, pdf, and other true and correct photostatic copies of this Agreement shall have the same force and effect as originals hereof.

(e) The headings used in this Agreement are included solely for convenience and shall not affect or be used in connection with the interpretation of this Agreement.  Wherever the context so requires, the masculine gender includes the feminine or neuter, and the singular number includes the plural and conversely.

(f) This Agreement represents the entire agreement between the Parties with respect to the subject matter hereof (with the exception of Restricted Stock Agreements to the extent applicable to benefits described under Section 4 above) and may not be amended except in a writing signed by the Company and Executive.

             (g)         This Agreement shall be binding on the executors, heirs, administrators, successors and assigns of Executive and the successors and assigns of the Company and shall fully inure to the benefit of the respective executors, heirs, administrators, successors and assigns of the Company Entities and to the surviving spouse, estate, heirs, executors, administrators and/or successors and assigns of Executive (including, without limitation, with respect to any rights (and the enforcement thereof) under this Agreement and/or against an insurer of any long term disability insurance policy for which premiums due and payable were fully paid).  The Company Entities are intended third-party beneficiaries.

(h) Nothing in this Agreement shall be construed as an admission of wrongdoing or liability on the part of the Company Entities or the Executive.

(i) No provision of this Agreement may be amended or modified unless such amendment or modification is agreed to in writing and signed by Executive and the Company.  No waiver by either of the Parties of any breach by the other Party hereto of any condition or provision of this Agreement to be performed by the other Party hereto shall be deemed a waiver of any similar or dissimilar provision or condition at the same or any prior or subsequent time, nor shall the failure of or delay by either of the Parties in exercising any right, power or privilege hereunder operate as a waiver thereof to preclude any other or further exercise thereof or the exercise of any other such right, power or privilege.

(j) Executive acknowledges and agrees that his continued employment though the Separation Date together with the payments and benefits set forth in this Agreement (including the Severance Benefits): (i) are in full discharge of any and all liabilities and obligations of the Company to Executive, monetarily or with respect to his employment; and (ii) exceed any payment, benefit, or other thing of value to which Executive might otherwise be entitled.

(k) Executive acknowledges and agrees that he is solely and entirely responsible for the payment and discharge of all federal, state and local taxes, if any, that he owes under any federal, state and/or local laws as a result of the payments and other consideration provided pursuant to the Agreement.  The Company will make appropriate withholdings from all payments made pursuant to this Agreement, as required by applicable law.

(l) Executive agrees to make himself available to cooperate reasonably and in good faith with the Company Entities in all matters related to his service to the Company Entities, in connection with any litigation or other legal proceedings in which the Company or its affiliates are involved (provided Executive and the Company Entities are not adverse parties or otherwise have a conflict of interest in regards to such litigation or legal proceeding).  The Company agrees that, in requesting and scheduling any cooperation hereunder, that it shall use its reasonable best efforts to accommodate and not interfere with Executive's other professional and personal scheduling demands and obligations (including in connection with any employment Executive may have).  The Company further agrees that it will reimburse (or pay directly on Executive's behalf) for any reasonable out-of-pocket expenses incurred by Executive, at the direction of the Company Entities, in connection with providing such cooperation, but Executive will not be entitled to additional compensation for such cooperation unless agreed upon in writing with the Company Representative.  The Company agrees to cooperate reasonably and in good faith with Executive in connection with any tax or insurance benefit matters that may arise out of or be related to Executive's employment as President with, or separation from, the Company (including, but not limited to, providing Executive with written notice of a request relating to any tax or insurance benefit matters at least seven business days within receiving such request and allowing Executive a reasonable opportunity to review and provide input on any written or electronic response or materials that the Company intends to submit in response to such inquiry).  Notwithstanding anything to the contrary, nothing shall require (i) Executive on the one hand and the Company on the other to provide any inaccurate or false information or testimony in connection with any matter, litigation, proceeding or otherwise in connection with matters on which they are obligated to cooperate hereunder or (ii) the Company to reply to any tax or insurance benefit matter inquiry (or similar circumstance) in the manner directed by Executive or with respect to Executive's input.

(m) Executive will notify the Company in writing to Scott Barnard, Akin Gump Strauss Hauer & Feld LLP, 1700 Pacific Avenue, Suite 4100, Dallas, Texas 75201, if at any time within seven (7) months after the Separation Date, Executive performs any work or takes any paid position as an employee, consultant, agent, contractor or other representative for: (1) any entity that was a vendor to the Company within the past two years; (2) any competitor in the industry or similar industry as that of the Company; or (3) any competitor that offers a similar product or service as that of the Company.

(n) For purposes of this Agreement, the connectives "and" and "or" shall be construed either disjunctively or conjunctively as necessary to bring within the scope of a sentence all facts or information that might otherwise be construed to be outside of its scope.

(a) It is the intent of the Parties to this Agreement that no payments under the Agreement be subject to the additional tax on deferred compensation imposed by Section 409A of the Internal Revenue Code of 1986, as amended (the "Code").  Notwithstanding the foregoing, the Company does not guarantee, nor do any of the Company Entities guarantee, that any payment hereunder complies with or is exempt from Section 409A of the Code and neither the Company nor the Company Entities, nor their executives, directors, officers, employees, members or affiliates shall have any liability with respect to any failure of any payments or benefits herein to comply with or be exempt from Section 409A of the Code.

 [SIGNATURE PAGE FOLLOWS]

 

BY SIGNING BELOW, EXECUTIVE REPRESENTS AND WARRANTS THAT HE HAS CAREFULLY READ AND FULLY UNDERSTANDS THE PROVISIONS OF THIS AGREEMENT AND HE HAS HAD AN OPPORTUNITY TO CONSULT WITH LEGAL COUNSEL.  HE SIGNS HIS NAME VOLUNTARILY AND WITH A FULL UNDERSTANDING OF ITS LEGAL CONSEQUENCES.  EXECUTIVE HEREBY ACCEPTS AND AGREES TO ALL OF THE TERMS OF THIS AGREEMENT KNOWINGLY AND VOLUNTARILY.

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of October 30, 2018.

On behalf of Tandy Leather Factory, Inc.

By: /s/ Janet Carr

 Janet Carr, CEO

On behalf of Executive

By:  /s/ Mark Angus

 Mark Angustris_EX_4_1_4

		
			Exhibit 4.1.4
		

		
			SUPPLEMENTAL MASTER MORTGAGE INDENTURE NO. 42
		

		
			Between
		

		
			TRI-STATE GENERATION AND TRANSMISSION ASSOCIATION, INC.
		

		
			And
		

		
			WELLS FARGO BANK, NATIONAL ASSOCIATION
		

		
			as Trustee
		

		
			dated effective as of December 11, 2018
		

		
			Supplemental to
		

		
			Master First Mortgage Indenture,
		

		
			Deed of Trust and Security Agreement
		

		
			Amended, Restated and Effective as of December 15, 1999,
		

		
			as further supplemented to date
		

		
			In connection with
		

		
			Series 2018B Secured Obligations
		

		
			THIS INSTRUMENT GRANTS A SECURITY INTEREST IN A TRANSMITTING UTILITY.  THE ADDRESSES AND THE SIGNATURES OF THE PARTIES TO THIS INSTRUMENT ARE STATED ON THE SIGNATURE PAGES.  THE TYPES OF PROPERTY COVERED BY THIS INSTRUMENT ARE DESCRIBED IN SECTIONS 1.01 AND 1.02 OF THIS INSTRUMENT.  THIS INSTRUMENT CONTAINS AN AFTER‐ACQUIRED PROPERTY CLAUSE.  PROCEEDS AND PRODUCTS OF COLLATERAL ARE COVERED BY THIS INSTRUMENT.  FUTURE ADVANCES AND FUTURE OBLIGATIONS ARE SECURED BY THIS INSTRUMENT.  THIS MORTGAGE SECURES CREDIT IN THE AMOUNT OF UP TO $5,000,000,000 AND ADVANCES UP TO THIS AMOUNT, TOGETHER WITH INTEREST, ARE SENIOR TO OTHER CREDITORS UNDER SUBSEQUENTLY FILED AND RECORDED MORTGAGES OR LIENS.
		

		
			TAXPAYER IDENTIFICATION NUMBER 84‐0464189
		

		
			 
		

		
			 
		

		
			

		 

 

		

		
			TABLE OF CONTENTS
		

			
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						Page

				
	
					
						Parties

					
1
				
	
					
						Recitals

					
1
				
	
					
						 

					
					
						 

				
	
					
						ARTICLE I – TRUST ESTATE

					
					
						 

				
	
					
						Section 1.01Confirmation of Granting Clause

					
1
				
	
					
						Section 1.02Supplemental Grant

					
1
				
	
					
						ARTICLE II – DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

					
					
						 

				
	
					
						Section 2.01Definitions of Words and Terms

					
2
				
	
					
						Section 2.02Conflicts with Supplemental Indentures

					
2
				
	
					
						ARTICLE III – AUTHORIZATION AND TERMS OF THE SERIES 2018B SECURED OBLIGATIONS

					
					
						 

				
	
					
						Section 3.01Authorization of Series 2018B Secured Obligations

					
2
				
	
					
						Section 3.02Persons Deemed Holder

					
3
				
	
					
						Section 3.03Additional Secured Obligations to be Equally Secured

					
3
				
	
					
						Section 3.04Registration, Transfer and Exchange

					
4
				
	
					
						Section 3.05Payments on the 2018B Secured Obligations

					
4
				
	
					
						Section 3.06Redemption and Prepayment

					
4
				
	
					
						ARTICLE IV – SUPPLEMENTS TO CERTAIN EXHIBITS

					
					
						 

				
	
					
						Section 4.01Supplements to Exhibits to Original Indenture

					
4
				
	
					
						ARTICLE V – REPRESENTATIONS AND WARRANTIES

					
					
						 

				
	
					
						Section 5.01Representations and Warranties

					
4
				
	
					
						Section 5.02Covenants under the Original Indenture

					
4
				
	
					
						ARTICLE VI – MISCELLANEOUS PROVISIONS

					
					
						 

				
	
					
						Section 6.01Ratification of Indenture

					
5
				
	
					
						Section 6.02Benefits of Indenture

					
5
				
	
					
						Section 6.03Provisions of the Indenture to Control

					
5
				
	
					
						Section 6.04Binding Effect

					
5
				
	
					
						Section 6.05Severability Clause

					
5
				
	
					
						Section 6.06Execution in Counterparts

					
5
				
	
					
						Section 6.07Governing Law

					
5
				
	
					
						Section 6.08Effect of Headings and Table of Contents

					
5
				
	
					
						Section 6.09Successors and Assigns

					
6
				
	
					
						Section 6.10Entire Agreement

					
6
				
	
					
						Section 6.11Acceptance of Trust

					
6
				

		
			 
		

		
			
		

		
			

		 

		

			Supplement 42 - Final - Page ii

		

 

		

		
			 
		

			
					
						 

					
					
						 

				
	
					
						Attachment 1

					
					
						Summary of Terms for the Series 2018B Secured Obligations

				
	
					
						Exhibit A-35

					
					
						Certain Additional Real Property

				
	
					
						Exhibit C

					
					
						List of Counties in which Land is Located

				
	
					
						Exhibit E-33

					
					
						Description of Series 2018B Secured Obligations

				
	
					
						Exhibit H-36

					
					
						Recording Data of the Original Indenture, the First Supplemental Indenture through the Twenty-fourth Supplemental Indenture, and the Twenty-sixth Supplemental Indenture through the Forty-first Supplemental Indenture for the purpose of providing access to the full and complete descriptions of all property encumbered thereby (less any property released of record), and in the case of filings in Kansas, Nebraska, and Wyoming, full descriptions of property encumbered in Kansas, Nebraska, and Wyoming.  There is no Twenty-fifth Supplemental Indenture.

				
	
					
						Exhibit O

					
					
						(Conejos County, Colorado ONLY)  Copy of Original Indenture (O-1), the First Supplemental Indenture (O-2), the Second Supplemental Indenture (O 3), the Third Supplemental Indenture (O-4), the Fourth Supplemental Indenture (O-5), the Fifth Supplemental Indenture (O-6), the Sixth Supplemental Indenture (O-7), the Seventh Supplemental Indenture (O-8), the Eighth Supplemental Indenture (O-9), the Ninth Supplemental Indenture (O 10), the Tenth Supplemental Indenture (O-11), the Eleventh Supplemental Indenture (O-12), the Twelfth Supplemental Indenture (O-13), the Thirteenth Supplemental Indenture (O-14), the Fourteenth Supplemental Indenture (O 15), the Fifteenth Supplemental Indenture (O-16), the Sixteenth Supplemental Indenture (O-17), the Seventeenth Supplemental Indenture (O 18), the Eighteenth Supplemental Indenture (O-19), the Nineteenth Supplemental Indenture (O-20), the Twentieth Supplemental Indenture (O 21), the Twenty-first Supplemental Indenture (O-22), the Twenty-second Supplemental Indenture (O-23), the Twenty-third Supplemental Indenture (O 24), the Twenty-fourth Supplemental Indenture (O-25), the Twenty-sixth Supplemental Indenture (O-26), the Twenty-seventh Supplemental Indenture (O-27), the Twenty-eighth Supplemental Indenture (O-28), the Twenty-ninth Supplemental Indenture (O-29), the Thirtieth Supplemental Indenture (O-30), the Thirty-first Supplemental Indenture (O-31), the Thirty-second Supplemental Indenture (O-32), the Thirty-third Supplemental Indenture (O 33), the Thirty-fourth Supplemental Indenture (O-34), the Thirty-fifth Supplemental Indenture (O-35), the Thirty-sixth Supplemental Indenture (O 36), the Thirty-seventh Supplemental Indenture (O-37), the Thirty-eighth Supplemental Indenture (O-38), the Thirty-ninth Supplemental Indenture (O 39), the Forty-second Supplemental Indenture (O-40), and the Forty-first Supplemental Indenture (O-41).

				

		
			 
		

		
			 
		

		
			 
		

		
			

		 

		

			Supplement 42 - Final - Page iii

		

 

		

		
			SUPPLEMENTAL MASTER MORTGAGE INDENTURE NO. 42
		

		
			THIS SUPPLEMENTAL MASTER MORTGAGE INDENTURE NO. 42, dated and effective as of December 11, 2018 (this “Forty-second Supplemental Indenture”), is between WELLS FARGO BANK, NATIONAL ASSOCIATION (as successor through consolidation to Wells Fargo Bank West, National Association), a national banking association having a corporate trust office in Minneapolis, Minnesota and authorized to act as a corporate trustee in Colorado (the “Trustee”), and TRI-STATE GENERATION AND TRANSMISSION ASSOCIATION, INC., a cooperative corporation organized and existing under the laws of the State of Colorado (the “Company”).
		

		
			RECITALS
		

		
			WHEREAS, the Company entered into the Master First Mortgage Indenture, Deed of Trust and Security Agreement, between the Company and the Trustee, amended, restated, and effective as of December 15, 1999 as previously amended and supplemented by forty supplemental indentures (collectively, the “Original Indenture”), for the purpose of providing for the issuance and securing of its senior secured debt thereunder; and
		

		
			WHEREAS, pursuant to Sections 4.02 and 9.01(c) of the Original Indenture and the Term Loan Agreement, dated and effective as of December 11, 2018 (the “2018 CoBank Agreement”), among the Company, the lenders from time to time parties thereto, and CoBank, ACB, as administrative agent (in such capacity, the “Administrative Agent”), the Company has issued two (2) promissory notes (as more particularly described in Exhibit E-33 and Attachment 1, the “Obligations to Administrative Agent”), which are issued for the purpose of repaying outstanding commercial paper or delaying additional commercial paper advances, refinancing portions of the Company’s indebtedness, including the payment of any make-whole premium or breakage fee, funding an upcoming indebtedness payment, and other general corporate purposes, to be known as the Tri-State Generation and Transmission Association, Inc. Electric System Secured Obligations Series 2018B (the “Series 2018B Secured Obligations”) and to further supplement the Original Indenture by this Forty-second Supplemental Indenture in order to authorize the Series 2018B Secured Obligations; and
		

		
			WHEREAS, as permitted by Sections 2.02 and 2.12 of the Original Indenture, the Company has requested the Trustee to authenticate the Obligations to Administrative Agent as the Series 2018B Secured Obligations and to deliver them to the Administrative Agent, and such Series 2018B Secured Obligations shall be entitled to the lien of the Indenture on a parity with all other Secured Obligations Outstanding under the Indenture; and
		

		
			WHEREAS, the Original Indenture has been filed of record in the official public records as described more particularly on Exhibit H-36 hereto; and
		

		
			WHEREAS, in addition to the property described in the Original Indenture, the Company has acquired certain other property rights and interests in property; and
		

		
			WHEREAS, all acts and things necessary to make this Forty-second Supplemental Indenture the valid, legal, and binding obligation of the Company and to constitute these presents, together with the Original Indenture, a valid indenture and agreement according to its terms, having been done and performed, and the execution of this Forty-second Supplemental Indenture having in all respects been duly authorized, the Original Indenture as amended by this Forty-second Supplemental Indenture (as so amended, the “Indenture”) shall be amended and supplemented as follows:
		

		
			ARTICLE I – TRUST ESTATE
		

		
			Section 1.01   Confirmation of Granting Clause.
		

		
			The Company hereby confirms and ratifies each of the Granting Clauses contained in the Original Indenture in order to secure the payment of the principal of, premium, if any, and interest and any other amounts due on the Series 2018B Secured Obligations.
		

		
			Section 1.02   Supplemental Grant.
		

		
			Pursuant to Granting Clause Third of the Original Indenture and in order to secure the payment of the principal of, premium, if any, and interest and any other amounts due on the Series 2018B Secured Obligations, 

		 

		

			Supplement 42 - Final - Page 1

		

 

and the performance of the covenants therein and in the Indenture contained, and to declare the terms and conditions on which the Series 2018B Secured Obligations are secured, and in consideration of the premises and of the acceptance of the Series 2018B Secured Obligations, by the Holders thereof, the Company by these presents does grant, bargain, sell, convey, assign, transfer, mortgage, hypothecate, pledge, set over and confirm to the Trustee, to be held in trust, together with the Trust Estate described in the Original Indenture, all property, rights, privileges and franchises of the Company of every kind and description, real, personal or mixed, tangible or intangible, whether now owned or hereafter acquired by the Company, wherever located, and grants a security interest therein for the purposes herein expressed, except any Excluded Property and any Excepted Property (each as defined in the Indenture) hereinafter expressly excepted from the lien hereof, or any property which has been released or disposed of pursuant to the terms of the Indenture, and including, without limitation, all and singular the following:
		

		
			All right, title and interest of the Company in and to the real property more particularly described in Exhibit A-35 attached hereto, which identifies the real property acquired by the Company and not previously described in the Original Indenture.
		

		
			A security interest in the Equipment, Contract Rights, General Intangibles and Proceeds (each as defined in the Original Indenture) of the personal property acquired by the Company since the recording of the Forty-first Supplemental Indenture; and in any funds, rights, rents, revenues and accounts receivable and general intangibles (including choses in action and judgments) arising under any contract subject to the lien of the Indenture all as described in GRANTING CLAUSE SECOND of the Indenture, acquired by the Company since the recording of the Forty-first Supplemental Indenture.
		

		
			ARTICLE II – DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
		

		
			Section 2.01   Definitions of Words and Terms.
		

		
			Words and terms used in this Forty-second Supplemental Indenture and not otherwise defined herein shall, except as otherwise stated, have the meanings assigned to them in the Original Indenture.
		

		
			The following definitions shall be added to Section 1.01 of the Indenture in alphabetical order:
		

		
			 
		

		
			“Series 2018B Secured Obligations” shall mean the Tri-State Generation and Transmission Association, Inc. Electric System Secured Obligations, Series 2018B, designated on Exhibit E-33, authorized by the Original Indenture as amended and supplemented by the Forty-second Supplemental Indenture.
		

		
			“Forty-second Supplemental Indenture” shall mean the Supplemental Master Mortgage Indenture No. 42, between the Company and the Trustee, dated effective as of December 11, 2018.
		

		
			Section 2.02   Conflicts with Supplemental Indentures.
		

		
			Supplemental Indentures may contain covenants which are different than the covenants of the Company contained in this Forty-second Supplemental Indenture provided that such covenants shall not conflict with the Original Indenture (except as permitted under Article IX of the Original Indenture).  Such covenants are intended to be supplemental hereto and the Company shall be obligated to comply with all covenants concerning any matter whether contained in a Supplemental Indenture or this Forty-second Supplemental Indenture so long as such Supplemental Indenture is in effect.
		

		
			ARTICLE III – AUTHORIZATION AND TERMS OF THE SERIES 2018B SECURED OBLIGATIONS
		

		
			Section 3.01   Authorization of Series 2018B Secured Obligations.
		

		
			(a)The Company hereby authorizes the authentication of two (2) promissory notes, both dated effective as of December 11, 2018, issued by the Company to the Administrative Agent in the principal amounts of $55,180,926.00 (which note is being issued in replacement of, and evidences the same outstanding indebtedness under, the Promissory Note, Loan No. ML0303T5, Tri-State Generation and Transmission Association, Inc. Electric System Secured Obligation 2006A Obligation, dated June 8, 2006 issued by the Company to CoBank, ACB) and $69,819,074.00, respectively.  Such notes shall collectively constitute the Tri-State Generation and Transmission 

		 

		

			Supplement 42 - Final - Page 2

		

 

Association, Inc. Electric System Secured Obligations, Series 2018B.  The Holder of the Series 2018B Secured Obligations is the Administrative Agent for the benefit of itself and each of the lenders party from time to time to the 2018 CoBank Agreement, and the Trustee shall execute a certificate of authentication to each of such notes which shall indicate that each of such notes is a Secured Obligation hereunder.
		

		
			 (b)The Series 2018B Secured Obligations are being issued for the purpose of repaying outstanding commercial paper or delaying additional commercial paper advances, refinancing portions of the Company’s indebtedness, including the payment of any make-whole premium or breakage fee, funding an upcoming indebtedness payment, and other general corporate purposes.  The Series 2018B Secured Obligations shall be issued in the form and with the interest payment dates and the maturity dates and at the rates of interest set forth in the 2018 CoBank Agreement and the Series 2018B Secured Obligations. The terms of repayment and prepayment of such Series 2018B Secured Obligations shall be as set forth in the 2018 CoBank Agreement and the Series 2018B Secured Obligations.  
		

		
			(c)No Series 2018B Secured Obligations shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such Series 2018B Secured Obligations or on an allonge thereto a certificate of authentication substantially in the form provided for herein executed by the Trustee or an authenticating agent by manual signature, and such certificate upon any Series 2018B Secured Obligations shall be conclusive evidence, and the only evidence, that such Secured Obligations have been duly authenticated and delivered hereunder and are entitled to the benefits of this Indenture.  
		

		
			 
		

		
			The Trustee's certificate of authentication for Series 2018B Secured Obligations shall be as set forth below:
		

		
			 
		

		
			Certificate of Authentication for Series 2018B Secured Obligations
		

		
			 
		

		
			(1)This instrument is a Secured Obligation under the terms of that certain Master First Mortgage Indenture, Deed of Trust and Security Agreement, as amended, restated and dated effective as of December 15, 1999, as amended (the "Master Indenture") and is secured thereunder on a parity with other Secured Obligations.
		

		
			 
		

		
			(2)In the event of the occurrence and continuance of an Event of Default under the Master Indenture, the Trustee shall enforce the remedies set forth under the Master Indenture for the benefit of all of the Holders of Secured Obligations.
		

		
			 
		

		
			WELLS FARGO BANK, NATIONAL ASSOCIATION, AS TRUSTEE
		

		
			 
		

		
			By: _____________________________
		

		
			Authorized Signatory
		

		
			(d)Pursuant to Section 2.02(b) of the Original Indenture, attached hereto as Attachment 1 is a summary of the terms of the notes for Series 2018B Secured Obligations.  Also attached hereto is Exhibit E-33, a description of the principal amount, maturity date, interest rate, and other terms of the notes constituting the Series 2018B Secured Obligations.
		

		
			Section 3.02   Persons Deemed Holder.
		

		
			Subject to the terms of Section 1.02(h) of the Original Indenture, the Trustee shall look to the Secured Obligation Register to conclusively determine the owners or Holders of such Series 2018B Secured Obligations for all purposes of the Indenture.
		

		
			Section 3.03   Additional Secured Obligations to be Equally Secured.
		

		
			Any series of Secured Obligations which may be authorized and issued pursuant to Article II of the Original Indenture shall be entitled to be secured under this Indenture equally and ratably with Secured Obligations theretofore 

		 

		

			Supplement 42 - Final - Page 3

		

 

issued and then Outstanding with no priority of any series of Secured Obligations over any other series of Secured Obligations (subject to subparagraph (b)(xi) of Section 2.02 of the Original Indenture).
		

		
			Section 3.04   Registration, Transfer and Exchange.
		

		
			The Series 2018B Secured Obligations shall be registered, exchanged, and replaced pursuant to Sections 2.05 and 2.06 of the Original Indenture.
		

		
			Section 3.05   Payments on the Series 2018B Secured Obligations.
		

		
			Payment on the Series 2018B Secured Obligations shall be made in the manner and in accordance with the 2018 CoBank Agreement and the Series 2018B Secured Obligations.  The Company shall serve as the Paying Agent for the Series 2018B Secured Obligations, and the Place of Payment of the Series 2018B Secured Obligations shall be the corporate offices of the Company set forth in Section 1.03 of the Original Indenture.
		

		
			Section 3.06   Redemption and Prepayment.
		

		
			The Series 2018B Secured Obligations shall be redeemable or prepayable, including, without limitation, the payment of the Make-Whole Amount (as defined in the 2018 CoBank Agreement), if any, and the break funding payment, if any, in accordance with the terms of the instruments evidencing and relating to such Series 2018B Secured Obligations and the 2018 CoBank Agreement.
		

		
			ARTICLE IV – SUPPLEMENTS TO CERTAIN EXHIBITS
		

		
			Section 4.01   Supplements to Exhibits to Original Indenture.    
		

		
			Exhibits A and E attached to the Original Indenture, as previously supplemented, are hereby supplemented by Exhibits A-35 and E-33 attached hereto.  Exhibit H-36 is hereby incorporated into the Indenture as attached hereto. Exhibit C to the Original Indenture is hereby amended and restated in its entirety to read as set forth in Exhibit C attached hereto. Exhibit O (including O-1 through O-41), filed ONLY, in Conejos County, Colorado, is hereby incorporated into this Indenture as set forth in such Exhibit attached hereto.  All Exhibits and Attachments are incorporated herein by reference.
		

		
			ARTICLE V – REPRESENTATIONS AND WARRANTIES
		

		
			Section 5.01   Representations and Warranties.
		

		
			The Company represents and warrants that (a) it is duly authorized under the laws of the State of Colorado and all other applicable provisions of law to execute this Forty-second Supplemental Indenture and to issue the Series 2018B Secured Obligations, (b) all corporate action on the part of the Company required by its organizational documents and the Original Indenture to establish this Forty-second Supplemental Indenture and the Series 2018B Secured Obligations as a binding and enforceable obligation of the Company has been duly and effectively taken, and (c) all requirements of the Original Indenture, including but not limited to the requirements of Sections 2.02, 2.12, and 4.02, for the issuance and authentication of the Series 2018B Secured Obligations have been satisfied.
		

		
			Section 5.02   Covenants under the Original Indenture.
		

		
			The Company confirms, covenants and agrees that so long as any Series 2018B Secured Obligations remain Outstanding, it will deliver to the Trustee all reports, opinions and other documents required by the Original Indenture to be submitted to the Trustee at the time said reports, opinions or other documents are required to be submitted to the Trustee, and that it will faithfully perform or cause to be performed at all times any and all covenants, agreements and undertakings required on the part of the Company contained in the Indenture and the Series 2018B Secured Obligations.  The Company further confirms its covenants and agrees with its undertakings in the Original Indenture.
		

		
			

		 

		

			Supplement 42 - Final - Page 4

		

 

		

		
			ARTICLE VI – MISCELLANEOUS PROVISIONS
		

		
			Section 6.01   Ratification of Indenture.
		

		
			The Original Indenture as amended and supplemented by this Forty-second Supplemental Indenture is in all respects ratified and confirmed, except as to any liens created by the Original Indenture which have been heretofore released of record, and the Original Indenture as so amended and supplemented shall be read, taken and construed as one and the same instrument.  Except as herein otherwise expressly provided, all the provisions, definitions, terms and conditions of the Original Indenture shall be deemed to be incorporated in, and made a part of, this Forty-second Supplemental Indenture.  All references to "this Indenture" or to "the Indenture" or to "hereunder" in the Indenture shall be to the Original Indenture, as amended and supplemented by this Forty-second Supplemental Indenture, and as otherwise amended and supplemented from time to time.  Except as amended and supplemented by this Forty-second Supplemental Indenture, and except as to any liens created by the Original Indenture which have heretofore been released of record, the Original Indenture remains in full force and effect and is hereby ratified in full by the parties hereto.
		

		
			Section 6.02   Benefits of Indenture.
		

		
			Nothing in this Forty-second Supplemental Indenture is intended to give any Person, other than the parties hereto and the Holders of Outstanding Secured Obligations and any Credit Provider to the extent provided herein, any benefit or any legal or equitable right, remedy or claim under this Forty-second Supplemental Indenture.
		

		
			Section 6.03   Provisions of the Indenture to Control.
		

		
			The provisions of Article VII of the Indenture shall control the terms under which the Trustee shall serve under this Forty-second Supplemental Indenture.
		

		
			Section 6.04   Binding Effect.
		

		
			All the covenants, stipulations, promises and agreements in this Forty-second Supplemental Indenture by or on behalf of the Company shall inure to the benefit of the parties hereto and the Holders, and shall bind their respective successors and assigns, whether so expressed or not.
		

		
			Section 6.05   Severability Clause.
		

		
			In case any provision in this Forty-second Supplemental Indenture or in any Secured Obligations shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
		

		
			Section 6.06   Execution in Counterparts.
		

		
			This Forty-second Supplemental Indenture may be executed in any number of counterparts, each of which shall be an original; and all of which shall together constitute but one and the same instrument.
		

		
			Section 6.07   Governing Law.
		

		
			This Forty-second Supplemental Indenture shall be construed and the rights and obligations of the parties hereunder enforced in accordance with and governed by the laws of the State of Colorado and applicable federal law, except (a) to the extent that the law of any other jurisdiction shall be mandatorily applicable; (b) to the extent that perfection, priority and enforcement and the effect of perfection, priority and enforcement of the lien of this Forty-second Supplemental Indenture, notice and enforcement of remedies may be governed by the laws of any state other than the State of Colorado as provided by law (including but not limited to the applicable laws of the States); or (c) that the rights, duties, obligations, privileges and immunities of the Trustee shall be governed by the laws of the jurisdiction in which the corporate trust office of the Trustee is located.
		

		
			Section 6.08   Effect of Headings and Table of Contents.
		

		
			The Article and Section headings herein and in the Table of Contents are for convenience only and shall not affect the construction hereof.
		

		
			

		 

		

			Supplement 42 - Final - Page 5

		

 

		

		
			Section 6.09   Successors and Assigns.
		

		
			All covenants and agreements in this Forty-second Supplemental Indenture by the Company shall bind its successors and assigns, whether so expressed or not.
		

		
			Section 6.10   Entire Agreement.
		

		
			This Forty-second Supplemental Indenture embodies the entire agreement among the parties hereto with respect to the subject matters hereof.
		

		
			Section 6.11   Acceptance of Trust.
		

		
			The Trustee hereby acknowledges and accepts the trusts granted hereby.
		

		
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			Supplement 42 - Final - Page 6

		

 

		

		
			 
		

		
			IN WITNESS WHEREOF, the parties hereto have caused this Forty-second Supplemental Indenture to be duly executed by the persons thereunto duly authorized, as of the date and year first above written.
		

		
			TRI-STATE GENERATION AND
		

		
			TRANSMISSION ASSOCIATION, INC.,
		

		
			as the Company
		

		
			By/s/ Rick L Gordon____________
		

		
			[SEAL]Rick L. Gordon
		

		
			Chairman and President
		

		
			Tri-State Generation and Transmission Association, Inc.
		

		
			1100 W. 116th Avenue
		

		
			Westminster, Colorado  80234
		

		
			ATTEST:
		

		
			By: /s/ Julie Kilty________
		

		
			Julie Kilty
		

		
			Secretary
		

		
			 
		

		
			STATE OF COLORADO)
		

		
			)ss.
		

		
			COUNTY OF ADAMS)
		

		
			 
		

		
			The foregoing instrument was acknowledged before me this 4th day of December, 2018, by Rick L. Gordon, Chairman and President of Tri-State Generation and Transmission Association, Inc.
		

		
			Witness my hand and official seal.
		

		
			/s/ Pamela Lee Schroeder
		

		
			Notary Public
		

		
			(Notary Seal)
		

		
			My commission expires:  4-4-22
		

		
			 
		

		
			Signature page for Supplemental Master Mortgage Indenture No. 42
		

		
			 
		

		
			

		 

		

			Supplement 42 - Final – Page 7 

		

 

		

		
			 
		

		
			WELLS FARGO BANK,
		

		
			NATIONAL ASSOCIATION,
		

		
			as Trustee
		

		
			By:/s/ Patrick T. Giordano
		

		
			Patrick T. Giordano
		

		
			Vice President, Corporate Trust
		

		
			Wells Fargo Bank, National Association
		

		
			125 High Street, 15th Floor
		

		
			MAC J9226-154
		

		
			Boston, MA 02110-2704
		

		
			 
		

		
			STATE OF MASSACHUSETTS)
		

		
			)ss.
		

		
			COUNTY OF SUFFOLK)
		

		
			 
		

		
			The foregoing instrument was acknowledged before me this 4th day of December, 2018, by Patrick T. Giordano, Vice President of Wells Fargo Bank, National Association.
		

		
			Witness my hand and official seal.
		

		
			/s/ Cathleen Cogliano Bilich
		

		
			Notary Public
		

		
			(Notary Seal)
		

		
			My commission expires:  October 24, 2019
		

		
			 
		

		
			Signature page for Supplemental Master Mortgage Indenture No. 42
		

		
			 
		

		
			

		 

		

			Supplement 42 - Final – Page 8

		

 

		

		
			 
		

		
			ATTACHMENT 1
		

		
			TO
		

		
			SUPPLEMENTAL MASTER MORTGAGE INDENTURE NO. 42
		

		
			 
		

		
			Summary of Terms for Series 2018B Secured Obligations
		

		
			 
		

		
			Series 2018B Secured Obligations
		

		
			 
		

		
			CoBank 2018 Term A Note:
		

		
			Borrower:  Tri-State Generation and Transmission Association, Inc. 
		

		
			Lender:  CoBank, ACB, a federally chartered instrumentality of the United States, as administrative agent for various lenders 
		

		
			Principal:  $55,180,926.00
		

		
			Interest Rate(s):  This note provides for the interest rate to be determined on or prior to the time of the advance.
		

		
			Maturity Date:  12/1/2028
		

		
			Issue Date:  12/11/2018
		

		
			 
		

		
			CoBank 2018 Term B Note:
		

		
			Borrower:  Tri-State Generation and Transmission Association, Inc. 
		

		
			Lender:  CoBank, ACB, a federally chartered instrumentality of the United States, as administrative agent for various lenders 
		

		
			Principal:  $69,819,074.00
		

		
			Interest Rate(s):  This note provides for the interest rate to be determined at the time of the advance or any conversion.
		

		
			Maturity Date:  12/1/2038
		

		
			Issue Date:  12/11/2018
		

		
			 
		

		
			 
		

		
			

		 

		

			Attachment 1 to Supplemental Master Mortgage Indenture No. 42Page 1 of 1

		

		

			 

		

 

		

			 

		

		

		
			 
		

		
			EXHIBIT A-35
		

		
			to the Supplemental Master Mortgage Indenture No. 42
		

		
			A full copy of the Forty-second Supplemental Indenture with the full Exhibit A-35 relevant to each individual state is being filed of record with the Secretary of State of each of the States of Arizona, Colorado, Kansas, Nebraska, New Mexico and Wyoming.  Counterparts of this Forty-second Supplemental Indenture that are being filed in counties in Arizona, Colorado, Kansas, Nebraska and Wyoming contain an Exhibit A-35 which identifies the fee owned property acquired by the Company and not previously described in the Original Indenture in that particular county and those easements acquired by the Company and not previously described in the Original Indenture in that particular county. In New Mexico, a notice of the recordings filed in the public utility filings of the New Mexico Secretary of State is filed in each appropriate New Mexico county.
		

		
			 
		

		
			

		 

		

			Exhibit A-35 to Supplemental Master Mortgage Indenture No. 42

		

		

			 

		

 

		

			 

		

		

		
			EXHIBIT C
		

		
			Listing of Counties in which Land is Located
		

		
			December 11, 2018
		

		
			Amended and Restated Exhibit C to the Indenture
		

		
			(Supplemental Master Mortgage Indenture No. 42)
		

		
			 
		

		
			 
		

			
					
						 

					
					
						 

					
					
						 

				
	
					
						State of Arizona:

					
					
						Colorado (Cont’d)

					
					
						State of New Mexico:

				
	
					
						Apache

					
					
						Phillips

					
					
						Bernalillo

				
	
					
						 

					
					
						Prowers

					
					
						Cibola

				
	
					
						State of Colorado:

					
					
						Pueblo

					
					
						Colfax

				
	
					
						Adams

					
					
						Rio Blanco

					
					
						Dona Ana

				
	
					
						Alamosa

					
					
						Rio Grande

					
					
						Grant

				
	
					
						Arapahoe

					
					
						Routt

					
					
						Harding

				
	
					
						Archuleta

					
					
						Saguache

					
					
						Hidalgo

				
	
					
						Baca

					
					
						San Juan

					
					
						Luna

				
	
					
						Bent

					
					
						San Miguel

					
					
						McKinley

				
	
					
						Boulder

					
					
						Washington

					
					
						Mora

				
	
					
						Broomfield

					
					
						Weld

					
					
						Otero

				
	
					
						Chaffee

					
					
						Yuma

					
					
						Rio Arriba

				
	
					
						Cheyenne

					
					
						 

					
					
						San Juan

				
	
					
						Conjeos

					
					
						State of Kansas:

					
					
						San Miguel

				
	
					
						Crowley

					
					
						Finney

					
					
						Sandoval

				
	
					
						Delta

					
					
						 

					
					
						Sierra

				
	
					
						Dolores

					
					
						State of Nebraska:

					
					
						Socorro

				
	
					
						Eagle

					
					
						Arthur

					
					
						Taos

				
	
					
						El Paso

					
					
						Banner

					
					
						Torrance

				
	
					
						Elbert

					
					
						Box Butte

					
					
						Union

				
	
					
						Garfield

					
					
						Chase

					
					
						Valencia

				
	
					
						Grand

					
					
						Cheyenne

					
					
						 

				
	
					
						Gunnison

					
					
						Deuel

					
					
						State of Wyoming:

				
	
					
						Hinsdale

					
					
						Dundy

					
					
						Albany

				
	
					
						Huerfano

					
					
						Garden

					
					
						Big Horn

				
	
					
						Jefferson

					
					
						Grant

					
					
						Campbell

				
	
					
						Kiowa

					
					
						Keith

					
					
						Carbon 

				
	
					
						Kit Carson

					
					
						Kimball

					
					
						Converse

				
	
					
						La Plata

					
					
						Lincoln

					
					
						Fremont

				
	
					
						Larimer

					
					
						Morrill

					
					
						Goshen

				
	
					
						Las Animas

					
					
						Perkins

					
					
						Hot Springs

				
	
					
						Lincoln

					
					
						Scotts Bluff

					
					
						Johnson

				
	
					
						Logan

					
					
						 

					
					
						Laramie

				
	
					
						Mesa

					
					
						 

					
					
						Natrona

				
	
					
						Moffat

					
					
						 

					
					
						Niobrara

				
	
					
						Montezuma

					
					
						 

					
					
						Park

				
	
					
						Montrose

					
					
						 

					
					
						Platte

				
	
					
						Morgan

					
					
						 

					
					
						 

				
	
					
						Otero

					
					
						 

					
					
						 

				
	
					
						Ouray

					
					
						 

					
					
						 

				

		
			 
		

		
			 
		

		
			

		 

		

			Exhibit C

		

		

			 

		

 

		

			 

		

		

		
			EXHIBIT E-33
		

		
			Description of the Secured Obligations Under This Indenture
		

		
			On the Date of Execution and Delivery of this Indenture
		

		
			 
		

		
			Tri-State Generation and Transmission Association, Inc. Electric System
		

		
			Secured Obligations Series 2018B (2018 CoBank Agreement)
		

		
			 
		

			
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						Note No.

					
					
						Execution Date

					
					
						Stated Principal Amount

					
					
						Interest Rate(s)

					
					
						Stated Maturity Date

				
	
					
						 

					
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						CoBank 2018 Term A

					
					
						12/11/2018

					
					
						$55,180,926.00

					
					
						TBD

					
					
						12/1/2028

				
	
					
						CoBank 2018 Term B

					
					
						12/11/2018

					
					
						$69,819,074.00

					
					
						Variable

					
					
						12/1/2038

				

		
			 
		

		
			 
		

		
			

		 

		

			E-33

		

		

			 

		

 

		

			 

		

		

		
			EXHIBIT H-36
		

		
			 
		

		
			to the Supplemental Master Mortgage Indenture No. 42
		

		
			 
		

		
			A full copy of the Forty-second Supplemental Indenture with the Exhibit H-36 relevant to each individual state is being filed of record with the Secretary of State of each of the States of Arizona, Colorado, Kansas, Nebraska, New Mexico and Wyoming.  Counterparts of this Forty-second Supplemental Indenture that are being filed in counties in Arizona, Colorado, Kansas, Nebraska and Wyoming contain an Exhibit H-36 which identifies the recording data of the Original Indenture, the First Supplemental Indenture through the Twenty-fourth Supplemental Indenture, and the Twenty-sixth Supplemental Indenture through the Forty-first Supplemental Indenture for that county for the purpose of providing access to the full and complete descriptions of all property encumbered thereby (less property released of record) and in the case of filings in Kansas, Nebraska and Wyoming, full descriptions of property encumbered in that applicable county in Kansas, Nebraska and Wyoming.  In New Mexico, a notice of the recordings filed in the public utility filings of the New Mexico Secretary of State is filed in each appropriate New Mexico county.  There is no Twenty-fifth Supplemental Indenture.
		

		
			 
		

		
			

		 

		

			Exhibit H-36 cover page to Supplemental Master Mortgage Indenture No. 42 

		

		

			 

		

 

		

			 

		

		

		
			EXHIBIT H-36
		

		
			RECORDING INFORMATION FOR
		

		
			____________ COUNTY, [STATE]
		

			
					
						 

					
					
						 

					
					
						 

					
					
						 

				
	
					
						County

					
					
						Document

					
					
						Recording Information

					
					
						Date of Recording

				
	
					
						 

					
					
						Original Indenture

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 1

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 2

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 3

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 4

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 5

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 6

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 7

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 8

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 9

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 10

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 11

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 12

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 13

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 14

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 15

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 16

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 17

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 18

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 19

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 20

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 21

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 22

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 23

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 24

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 26*

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 27

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 28

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 29

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 30

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 31

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 32

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 33

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 34

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 35

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 36

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 37

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 38

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 40

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Supplement 41

					
					
						 

					
					
						 

				

		
			*Supplement 25 was skipped and will not be used.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00293-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00293-of-00352.parquet"}]]