Document:

aljj-ex1013_552.htm

 

EXHIBIT 10.13

 

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “Agreement”), dated as of December 17, 2021, is entered into by and between Marc Reisch (the “Executive”) and Phoenix Color Corp. (the “Company”).

WHEREAS, the Executive and ALJ Regional Holdings, Inc. (“ALJJ”) are party to that certain Employment Agreement (the “Prior Agreement”), dated November 6, 2020, pursuant to which the Executive performs certain services to the Company, which is the wholly owned subsidiary of ALJJ.

WHEREAS, effective upon the effectiveness of this Agreement, the Executive and ALJJ have agreed to terminate the Prior Agreement.

WHEREAS, the Company desires to continue to employ the Executive, and the Executive wishes to continue such employment with the Company according to the terms set forth in this Agreement.

ACCORDINGLY, the Company and the Executive agree as follows:

1.Employment, Duties and Acceptance.

1.1Employment, Duties

.  The Company hereby agrees to employ the Executive for the Term (as defined in Section 2) to render substantially full-time services to the Company as the Company’s Chairman, or in such other executive position as may be mutually agreed upon by the Company and the Executive, provided that the Executive may serve on the board of directors for other for-profit and not-for-profit entities with notice to and consent of the Compensation, Nominating and Corporate Governance Committee of ALJJ (the “CNCG Committee”), such consent not to be unreasonably withheld.

1.2Acceptance

.  The Executive hereby accepts such employment and agrees to render the services described above.  During the Term, the Executive agrees to serve the Company faithfully and to the best of the Executive’s ability and to use the Executive’s best efforts, skill and ability to promote the Company’s interests.

1.3Location

.  The duties to be performed by the Executive hereunder shall be performed at the offices of the Company, the Executive’s home office and other such locations mutually agreed with the Company, subject to reasonable travel requirements on behalf of the Company.

2.Term of Employment.

The term of the Executive’s employment under this Employment Agreement (the “Term”) shall commence on the date hereof (the “Effective Date”), and shall continue until September 30, 2023, subject to earlier termination pursuant to Section 4.

 

 

3.Compensation; Benefits.

3.1Salary

.  As compensation for all services to be rendered pursuant to this Agreement as an employee during the Term, the Company agrees to continue to pay the Executive a base salary, payable in accordance with the Company’s normal payroll practices, at the annual rate of two hundred thousand dollars ($200,000) less such deductions or amounts to be withheld as required by applicable law and regulations (the “Base Salary”).  In the event that the CNCG Committee, in its sole discretion, from time to time determines to increase the Base Salary, such increased amount shall, from and after the effective date of the increase, constitute “Base Salary” for purposes of this Agreement.

3.2Base Bonus

.  Commencing with the fiscal year ending September 30, 2021, the Executive shall be paid a base bonus (the “Base Bonus”) with respect to each fiscal year ending during the Term of two hundred thousand ($200,000). 

3.3Incentive Compensation

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In addition to the Base Bonus, the Executive shall be eligible to earn a bonus with respect to each fiscal year ending during the Term computed in accordance with the provisions hereafter (an “Annual Bonus”).  If the Pre-Bonus Earnings amount is less than or equal to twenty-seven million dollars ($27,000,000), the Annual Bonus shall be equal to ten percent (10%) of the positive difference (if any) between the Pre-Bonus Earnings amount for such fiscal year less the Bonus Threshold.  If the Pre-Bonus Earnings amount is greater than twenty seven million dollars ($27,000,000), the Annual Bonus shall be equal to the sum of (i) nine hundred and fifty thousand dollars ($950,000) and (ii) five percent (5%) of the positive difference between the Pre-Bonus Earnings amount for such fiscal year less twenty seven million dollars ($27,000,000).  By way of example, if Pre-Bonus Earnings for any fiscal year were (i) twenty million dollars ($20,000,000), the Annual Bonus for such fiscal year shall be two hundred fifty thousand dollars ($250,000) and combined with the Base Bonus, the total bonus would be four hundred and fifty thousand dollars ($450,000). For the avoidance of doubt, the Annual Bonus for the fiscal year ending September 30, 2021 shall be seven hundred and forty thousand ($740,000) and shall be paid on or before December 31, 2021. 

The “Pre-Bonus Earnings” amount shall equal the EBITDA (as defined below) of the Company before any bonus amount owed to the Executive and the Company’s Chief Operating Officer but after all other bonus amounts.  The “Bonus Threshold” shall be seventeen million five hundred thousand dollars ($17,500,000) and shall be subject to adjustment by the CNCG Committee from time to time in its discretion to account for material acquisitions or dispositions of any business or assets of or by the Company or its subsidiaries.

Subject to Section 4, each Base Bonus and Annual Bonus, if earned in accordance with this Agreement, shall be paid no later than the fifteenth day of the third month following the fiscal year with respect to which such bonus was earned; provided, that in the event of a Sale, a pro-rated portion of the Base Bonus and the Annual Bonus for the year in which the Sale occurs (but using, for purposes of the Annual Bonus, the trailing twelve month EBITDA as of the last day of the fiscal quarter preceding the fiscal quarter in which the Sale occurs) shall be paid to the Executive at the time and in the manner as the Sale Bonus described in Section 3.5 and the Company shall have no other obligation to pay the Executive a Base Bonus or Annual Bonus for the fiscal year in which the Sale occurs.

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Notwithstanding anything to the contrary contained herein, if the Audit Committee of ALJJ or any other relevant committee or person, including the Chief Executive Officer of ALJJ, in its discretion after consultation with the Company’s auditors, determines that any material restatement, revision or change to the Company’s financial statements requires a change in the calculation of EBITDA for any particular fiscal year of the Company, the CNCG Committee may require reimbursement from the Executive of any excess Annual Bonus paid to the Executive as a result of the recalculated EBITDA for such particular fiscal year of the Company.

Except as otherwise set forth herein, for the purposes of this Agreement, “EBITDA” means for any fiscal year of the Company, consolidated operating income for such fiscal year of the Company plus, without duplication and to the extent reflected as a charge in the statement of such operating income for such fiscal year, the sum of (i) depreciation and amortization expense (excluding amounts of prepaid incentives under customer contracts), (ii) any extraordinary non-cash expenses or losses, (iii) all restructuring costs (as defined under U.S. generally accepted accounting principles (“GAAP”)), (iv) fees paid to the Company’s external advisors in connection with acquisitions for the business (whether or not consummated) and (v) effects of changes in accounting policy and GAAP, in the case of clauses (i) through (iii) above, solely with respect to the Company, and minus without duplication and to the extent included in the statement of such operating income for such period, the sum of (a) any extraordinary or nonrecurring non-cash income or gains (including, whether or not otherwise includable as a separate item in the statement of such operating income for such period, gains on the sales of assets outside of the ordinary course of business), (b) effects of changes in accounting policy and GAAP, and (c) any cash payments made during such period in respect of items described in clause (ii) above subsequent to the fiscal quarter in which the relevant non-cash expenses or losses were reflected as a charge in the statement of operating income, in the case of clauses (a) through (c) above, solely with respect to the Company, all of the foregoing to be determined by the CNCG Committee or any other relevant committee or person, including the Chief Executive Officer of ALJJ.

3.4Retention Bonus.  The Executive shall be eligible to earn a retention bonus in the amount of five million dollars ($5,000,000) (the “Retention Bonus”).

3.4.1Twenty (20%) percent of the Retention Bonus shall vest and become payable on December 15, 2021, provided, that, subject to Section 4 below, the Executive has remained continuously employed with the Company (or one of its affiliates) until December 15, 2021.

3.4.2Forty (40%) percent  of the Retention Bonus shall vest and become payable on September 15, 2022, provided, that, subject to Section 4 below, the Executive has remained continuously employed with the Company (or one of its affiliates) until September 15, 2022.

3.4.3Forty (40%) percent of the Retention Bonus shall vest and become payable on September 15, 2023, provided, that, subject to Section 4 below, the Executive has remained continuously employed with the Company (or one of its affiliates) until September 15, 2023.

Subject to Section 4, each installment of the Retention Bonus shall be paid to the Executive in a lump sum on the first payroll period following the applicable vesting date.

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3.5Sale Bonus.  If the Company is acquired, merges, or sells all or substantially all of its assets during the Term (each a “Sale”), the Executive shall be paid a bonus (the “Sale Bonus”), equal to five percent (5%) of the net sale price less Eighty-Five Million Dollars ($85,000,000).  Subject to Section 4, the Sale Bonus shall be paid to the Executive in a lump sum on the first payroll period following the closing of the Sale.

3.6Business Expenses

.  The Company shall pay or reimburse the Executive for all reasonable expenses actually incurred or paid by the Executive during the Term in the performance of the Executive’s services under this Agreement, upon presentation of expense statements or vouchers or such other supporting information as the Company customarily may require of its officers within sixty (60) days after such expenses have been incurred by the Executive; provided, however, that the maximum amount available for such expenses during any period may be fixed in advance by the CNCG Committee.

3.7Paid Time Off

.  During the Term, the Executive shall be entitled to Paid Time Off in accordance with the Paid Time Off policy of the Company during each year of the Term.

3.8Benefits

.  During the Term, the Executive shall be entitled to all benefits for which the Executive shall be eligible under any 401(k) plan, group insurance or other health and welfare benefit plans as well as all benefits which the Company provides to its executive employees generally, which benefits may be amended, modified or terminated in the Company’s discretion.  In addition, during the Term, the Company shall pay the premiums for the Executive’s key man life insurance policy (the “Key Man Insurance”); provided, that (i) the Company shall be the sole beneficiary of the Key Man Insurance, and (ii) neither the Executive nor the heirs or personal representatives of the Executive shall have any interest in or to any proceeds associated with such policy.  For avoidance of doubt, the Executive will not be entitled to an automobile allowance.

4.Termination.

4.1Death

.  If the Executive dies during the Term, the Agreement shall terminate forthwith upon the Executive’s death.  The Company shall pay to the Executive’s estate:  (i) any Base Salary earned but not paid, (ii) any unpaid portion of the Retention Bonus (including any portion that had not yet vested as of the date of the Executive’s death), (iii) a Base Bonus and an Annual Bonus for the fiscal year prior to the fiscal year in which the Executive dies if at the time of death the Executive has otherwise earned a Base Bonus and an Annual Bonus payment for such prior fiscal year and has not yet been paid such Base Bonus and Annual Bonus, which prior fiscal year Base Bonus and Annual Bonus will be paid at the time and in the manner such prior fiscal year Base Bonus and Annual Bonus would have been paid to the Executive had he continued to work for the Company and (iv) a pro-rated portion (based on the number of days the Executive was employed by the Company during the fiscal year in which the Executive dies) of the Base Bonus and Annual Bonus that the Executive would have earned had the Executive remained employed through the end of the fiscal year in which the Executive’s death occurs, which Base Bonus and Annual Bonus will be paid at the time and in the manner such Base Bonus and Annual Bonus would have been paid to the Executive had he continued to work for the Company.  The Executive shall have no further rights to any compensation (including any Base Salary, Base Bonus, Annual Bonus or Sale Bonus) or any other benefits under this Agreement, except to the extent already earned and vested as of the day immediately 

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prior to his death, or as earned, vested, or accrued by virtue of his death.  For the avoidance of doubt, in the event the Executive’s death is following a Sale but prior to payment of the Sale Bonus, the Sale Bonus shall be paid to the Executive’s estate.

4.2Disability

.  If, during the Term the Executive is unable to perform his duties hereunder due to a physical or mental incapacity for a period of six (6) months within any 12-month period (hereinafter a “Disability”), the Company shall have the right at any time thereafter to terminate the Agreement upon sending written notice of termination to the Executive.  If the Company elects to terminate the Agreement by reason of Disability, the Company shall pay to the Executive promptly after the notice of termination:  (i) any Base Salary earned but not paid, (ii) any unpaid portion of the Retention Bonus (including any portion that had not yet vested as of the date of the Executive’s termination), (iii) a Base Bonus and an Annual Bonus for the fiscal year prior to the fiscal year in which the Executive is terminated if at the time of termination the Executive has otherwise earned a Base Bonus and an Annual Bonus payment for such prior fiscal year and has not yet been paid such Base Bonus and Annual Bonus, which prior fiscal year Base Bonus and Annual Bonus will be paid at the time and in the manner such prior fiscal year Base Bonus and Annual Bonus would have been paid to the Executive had he not been terminated and (iv) a pro-rated portion (based on the number of days the Executive was employed by the Company during the fiscal year in which the Executive is terminated) of the Base Bonus and Annual Bonus that the Executive would have earned had the Executive remained employed through the end of the fiscal year in which the termination occurs, which Base Bonus and Annual Bonus will be paid at the time and in the manner such Base Bonus and Annual Bonus would have been paid to the Executive had he continued to work for the Company, in each case less any other benefits payable to the Executive under any disability plan provided for hereunder or otherwise furnished to the Executive by the Company.  The Executive shall have no further rights to any compensation (including any Base Salary, Base Bonus, Annual Bonus or Sale Bonus) or any other benefits under this Agreement except to the extent already earned and vested as of the day immediately prior to his termination by reason of Disability, or as earned, vested, or accrued by virtue of his Disability.  For the avoidance of doubt, in the event the Executive’s employment is terminated due to Disability following a Sale but prior to payment of the Sale Bonus, the Sale Bonus shall remain payable to the Executive.

4.3Cause

.  The Company may at any time by written notice to the Executive terminate the Agreement for “Cause” (as defined below) and, upon such termination, this Agreement shall terminate and the Executive shall be entitled to receive no further amounts or benefits hereunder, except for any Base Salary earned but not paid prior to such termination.  For the purposes of this Agreement, “Cause” means:  (i) continued neglect by the Executive of the Executive’s duties hereunder, (ii) continued incompetence or unsatisfactory attendance, (iii) conviction of any felony, (iv) violation of the rules, regulations, procedures or instructions relating to the conduct of employees, directors, officers and/or consultants of the Company, (v) willful misconduct by the Executive in connection with the performance of any material portion of the Executive’s duties hereunder, (vi) breach of fiduciary obligation owed to the Company or commission of any act of fraud, embezzlement, disloyalty or defalcation, or usurpation of a Company opportunity, (vii) breach of any provision of this Agreement, including any non-competition, non-solicitation and/or confidentiality provisions hereof, (viii) any act that has a material adverse effect upon the reputation of and/or the public confidence in the Company, (ix) failure to comply with a reasonable order, policy or rule that constitutes material insubordination, (x) engaging in any discriminatory or sexually harassing behavior, or (xi) using, possessing or 

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being impaired by or under the influence of illegal drugs or the abuse of controlled substances or alcohol on the premises of the Company or any of its subsidiaries or affiliates or while working or representing the Company or any of its subsidiaries or affiliates.  A termination for Cause by the Company or any or the events described in clauses (i), (ii), (iv), (ix), (x) and (xi) shall only be effective on thirty (30) days advance written notification, providing Executive the opportunity to cure, if reasonably capable of cure within said thirty (30) day period; provided, however, that no such notification is required if the Cause event is not reasonably capable of cure or the Company determines to effect a termination of the Executive for Cause immediately.

4.4Termination by Company without Cause or by the Executive for Good Reason

.  If the Executive’s employment is terminated prior to the end of the Term by the Company without Cause (other than by reason of death or Disability) or by the Executive for Good Reason (as defined below), the Executive shall receive (i) any Base Salary earned but not paid, (ii) any unpaid portion of the Retention Bonus (including any portion that had not yet vested as of the date of the Executive’s termination), (iii) a Base Bonus and an Annual Bonus for the fiscal year prior to the fiscal year in which the Executive is terminated if at the time of termination the Executive has otherwise earned a Base Bonus and an Annual Bonus payment for such prior fiscal year and has not yet been paid such Base Bonus and Annual Bonus, which prior fiscal year Base Bonus and Annual Bonus will be paid at the time and in the manner such prior fiscal year Base Bonus and Annual Bonus would have been paid to the Executive had he not been terminated and (iv) a pro-rated portion (based on the number of days the Executive was employed by the Company during the fiscal year in which the Executive is terminated) of the Base Bonus and Annual Bonus that the Executive would have earned had the Executive remained employed through the end of the fiscal year in which the termination occurs, which Base Bonus and Annual Bonus will be paid at the time and in the manner such Base Bonus and Annual Bonus would have been paid to the Executive had he continued to work for the Company.  The Executive shall have no further rights to any compensation (including any Base Salary, Base Bonus, Annual Bonus or Sale Bonus) or any other benefits under this Agreement except to the extent already earned and vested as of the day immediately prior to his termination pursuant to this Section 4.4, or as earned, vested, or accrued by virtue of this Section 4.4.  For purposes of this Agreement, “Good Reason” means, without the advance written consent of the Executive:  (i) a reduction in Base Salary, Base Bonus, Annual Bonus, Retention Bonus or Sale Bonus as contemplated by Sections 3.1, 3.2, 3.3, 3.4 and 3.5 hereof or (ii) a material reduction in the Executive’s title and/or responsibilities, provided, that a change in reporting responsibilities or a reduction in responsibilities that occurs solely by virtue of the Company being acquired and made part of a larger entity shall not by itself constitute Good Reason and further provided, that a termination by the Executive for Good Reason shall be effective only if the Executive provides the Company with written notice specifying the event which constitutes Good Reason within thirty (30) days following the occurrence of such event or date Executive became aware or should have become aware of such event and the Company fails to cure the circumstances giving rise to Good Reason within thirty (30) days after such notice.  For the avoidance of doubt, in the event the Executive’s termination pursuant to this Section 4.4 is following a Sale but prior to payment of the Sale Bonus, the Sale Bonus shall remain payable to the Executive.

4.5Termination by Executive other than for Good Reason

.  The Executive is required to provide the Company with thirty (30) days’ prior written notice of termination to the Company.  Subject to Section 4.4, upon termination of employment by the Executive, the Executive shall receive any Base Salary earned but not paid prior to such termination and shall 

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have no further rights to any compensation (including any Base Salary, Base Bonus, Annual Bonus or Sale Bonus) or any other benefits under this Agreement, except to the extent already earned and vested as of the day immediately prior to such termination.  For the avoidance of doubt, in the event the Executive’s termination pursuant to this Section 4.5 is following a Sale but prior to payment of the Sale Bonus, the Sale Bonus shall remain payable to the Executive.

4.6Release

.  Notwithstanding any other provision of this Agreement to the contrary, the Executive acknowledges and agrees that any and all payments, other than payment of any accrued and unpaid Base Salary to which the Executive (or his estate) is entitled under this Section 4 are conditioned upon and subject to the Executive’s (or his estate’s) execution of a general waiver and release (for the avoidance of doubt, the restrictive covenants contained in Section 5 of this Agreement shall survive the termination of this Agreement), in such form as may be prepared by the Company, except for such matters covered by provisions of this Agreement which expressly survive the termination of this Agreement.  Notwithstanding anything to the contrary, the severance payments and benefits are conditioned on the Executive’s (or his estate’s) execution, delivery and nonrevocation of the general waiver and release of claims (the “Release Condition”) within fifty-five (55) days following the Executive’s date of “separation from service” (as defined in Treas. Reg. § 1.409A-1(h)) (“Separation from Service Date”).  Payments and benefits due under this agreement (other than bonuses which will be paid at the time and in the manner otherwise provided in this Agreement), shall commence sixty (60) days after the Executive’s Separation from Service Date.  However, if Executive is a “specified employee” (within the meaning of Section 409A and as determined by the Company) (a “Specified Employee”), any payment or benefit under this Agreement, or under any plan or arrangement of the Company or its affiliates, that constitutes a “deferral of compensation” subject to Section 409A, and that if paid during the six (6) months beginning on the Separation from Service Date would be subject to the Section 409A additional tax because the Executive is a Specified Employee, will not be paid or provided to the Executive until the earlier of (i) the first day following the six (6)-month anniversary of the Executive’s Separation from Service Date, or (ii) death.  No payments or benefits will be due or payable under this Agreement unless the Release Condition is timely met.

4.7Disposition of Stock in Event of Termination

.  In the event Executive’s employment is terminated pursuant to this Section 4, ALJJ agrees to use its reasonable efforts to assist the Executive in the disposition of Executive’s holdings of the common stock of ALJJ, including, but not limited to, facilitating block trades and authorizing the removal of restrictive legends; provided, however, that in no event shall ALJJ be obligated to purchase any of Executive’s holdings of the common stock of ALJJ.

4.8Section 409A.

4.8.1This Agreement is intended to satisfy the requirements of Section 409A of the Code and the regulations and other guidance thereunder (“Section 409A”) with respect to amounts, if any, subject thereto and shall be interpreted and construed and shall be performed by the parties consistent with such intent.  If either party notifies the other in writing that one or more or the provisions of this Agreement contravenes any Treasury Regulations or guidance promulgated under Section 409A or causes any amounts to be subject to interest, additional tax or penalties under Section 409A, the parties shall agree to negotiate in good faith to make amendments to this Agreement as the parties mutually agree, reasonably and in good faith are necessary or desirable, to (i) maintain to the maximum extent reasonably 

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practicable the original intent of the applicable provisions without violating the provisions of Section 409A or increasing the costs to the Company of providing the applicable benefit or payment and (ii) to the extent possible, to avoid the imposition of any interest, additional tax or other penalties under Section 409A upon the parties, provided that, notwithstanding the foregoing, the Company makes no representation that amounts payable under this Agreement will comply with Section 409A and makes no undertaking to prevent Section 409A from applying to any amounts paid under this Agreement.  

4.8.2Any payment or benefit due upon a termination of the Executive’s employment that represents a “deferral of compensation” within the meaning of Section 409A shall be paid or provided to the Executive only upon a “separation from service” as deemed in Treas. Reg. § 1.409A-1(h).  The Executive’s right to receive any installment payments under this Agreement shall be treated as a right to receive a series of separate payments

4.8.3 and, accordingly, each installment payment shall at all times be considered a separate and distinct payment as permitted under Section 409A.  Amounts payable under this Agreement shall be deemed not to be a “deferral of compensation” subject to Section 409A to the extent provided in the exceptions in Treasury Regulation §§ 1.409A-1(b)(4) (“short-term deferrals”) and (b)(9) (“separation pay plans,” including the exception under subparagraph (iii)) and other applicable provisions of Treasury Regulation § 1.409A-1 through A-6.

4.8.4Notwithstanding anything to the contrary in Agreement, any payment or benefit under this Agreement or otherwise that is exempt from Section 409A pursuant to Treasury Regulation § 1.409A- I (b)(9)(v)(A) or (C) (relating to certain reimbursements and in-kind benefits) shall be paid or provided to the Executive only to the extent that the expenses are not incurred, or the benefits are not provided, beyond the last day of the second calendar year following the calendar year in which the Executive’s “separation from service” occurs; and provided further that such expenses are reimbursed no later than the last day of the third calendar year following the calendar year in which the Executive’s “separation from service” occurs.  To the extent any expense reimbursement or the provision of any in-kind benefit is determined to be subject to Section 409A (and not exempt pursuant to the prior sentence or otherwise) the amount of any such expenses eligible for reimbursement, or the provision of any in-kind benefit, in one calendar year shall not affect provision of in-kind benefits or expenses eligible for reimbursement in any other calendar year (except for any lifetime or other aggregate limitation applicable to medical expenses), and in no event shall any expenses be reimbursed after the last day of the calendar year following the calendar year in which the Executive incurred such expenses, and in no event shall any right to reimbursement or the provision or any in-kind benefit be subject to liquidation or exchange for another benefit.

5.Protection to Confidential Information; Restrictive Covenants.

5.1In view of the fact that the Executive’s work for the Company will bring the Executive into close contact with many confidential affairs of the Company not readily available to the public, trade secret information and plans for future developments, the Executive agrees:

5.1.1To keep and retain in the strictest confidence all confidential matters of the Company, including, without limitation, “know how,” trade secrets, customer lists, pricing policies, operational methods, technical processes, formulae, inventions and research 

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projects, other business affairs of the Company, and any material confidential information whatsoever concerning any director, officer, employee, shareholder, partner, customer or agent of the Company or their respective family members learned by the Executive heretofore or hereafter, and not to disclose them to anyone outside of the Company, either during or after the Executive’s employment with the Company, except in the course or performing the Executive’s duties hereunder or with the Company’s express written consent.  The foregoing prohibitions shall include, without limitation, directly or indirectly publishing (or causing, participating in, assisting or providing any statement, opinion or information in connection with the publication of) any diary, memoir, letter, story, photograph, interview, article, essay, account or description (whether fictionalized or not) concerning any of the foregoing, publication being deemed to include any presentation or reproduction of any written, verbal or visual material in any communication medium, including any book, magazine, newspaper, theatrical production or movie, or television or radio programming or commercial; and

5.1.2To deliver promptly to the Company on termination of the Executive’s employment by the Company, or at any time the Company may so request, all memoranda, notes, records, reports, manuals, drawings, blueprints and other documents (and all copies thereof), including data stored in computer memories or on other media used for electronic storage or retrieval, relating to the Company’s business and all property associated therewith, which the Executive may then possess or have under the Executive’s control, and not retain any copies, notes or summaries; provided the Executive shall be entitled to keep a copy or this Agreement and compensation and benefit plans to which Executive is entitled to receive benefits thereunder.

5.2In support of the Executive’s commitments to maintain the confidentiality of the Company’s confidential and trade secret information, (i) during the Term and (ii) for the longer of (x) any period the Executive is receiving any benefits contemplated under Section 3.7 hereof or (y) one year following the termination of the Executive’s employment or provision of services contemplated in (i) above (the “Restricted Period”), the Executive shall not in the United States and in any non-US jurisdiction where the Company may then do business:  (a) directly or indirectly, enter the employ of, or render any services to, any person, firm or entity engaged in any business competitive with any business of the Company or of any of its subsidiaries or affiliates, (b) engage in such business on the Executive’s own account, and the Executive shall not become interested in any such business, directly or indirectly, as an individual, partner, shareholder, director, officer, principal, agent, employee, trustee, consultant, or in any other relationship or capacity (c) directly or indirectly, solicit or encourage (or cause to be solicited or encouraged) or cause any client, customer or supplier of the Company to cease doing business with the Company, or to reduce the amount of business such client, customer or supplier does with the Company, or (d) directly or indirectly, solicit or encourage (or cause to be solicited or encouraged) to cease to work with the Company, or hire (or cause to be hired), any person who is an employee of or consultant then under contract with the Company or who was an employee of or consultant then under contract with the Company within the six (6)-month period preceding such activity without the Company’s written consent, provided, however, that this clause (d) shall not apply during the Restricted Period to a consulting or advisory firm which is also then currently engaged or under a retainer relationship (in each case, without any action by the Executive, whether directly or indirectly) by a subsequent employer of the Executive.  For the avoidance of doubt, in the event of termination of Executive’s employment in accordance 

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with Sections 4.1, 4.3 and 4.5 hereof, the Executive shall not be bound by the obligations of this Section 5.2.

5.3If the Executive commits a breach, or poses a serious and objective threat to commit a breach, of any of the provisions of Sections 5.1 or 5.2 hereof, the Company shall have the following rights and remedies:

5.3.1The right and remedy to have the provisions of this Agreement specifically enforced by any court having equity jurisdiction, it being acknowledged and agreed that any such breach or threatened breach will cause irreparable injury to the Company and that money damages will not provide an adequate remedy to the Company;

5.3.2The right and remedy to require the Executive to account for and pay over to the Company all compensation, profits, monies, accruals, increments or other benefits derived or received by the Executive as the result of any transactions constituting a breach of any of the provisions of the preceding paragraph, and the Executive hereby agrees to account for and pay over such benefits to the Company.  Each of the rights and remedies enumerated above shall be independent of the other, and shall be severally enforceable, and all of such rights and remedies shall be in addition to, and not in lieu of, any other rights and remedies available to the Company under law or in equity; and

5.3.3In addition to any other remedy which may be available (i) at law or in equity, or (ii) pursuant to any other provision of this Agreement, any payments or benefits provided by the Company pursuant to Section 4 will cease as of the date on which such violation first occurs.  In addition, if the Executive breaches any of the covenants contained in Sections 5.1 and 5.2 and the Company obtains injunctive relief with respect thereto (that is not later reversed or otherwise terminated or vacated by judicial order), the period during which the Executive is required to comply with that particular covenant shall be extended by the same period that the Executive was in breach of such covenant prior to the effective date of such injunctive relief.

5.4If any of the covenants contained in Sections 5.1 or 5.2, or any part thereof, hereafter are held by a court to be invalid or unenforceable, the same shall not affect the remainder of the covenant or covenants, which shall be given full effect, without regard to those portions found invalid.

5.5If any of the covenants contained in Sections 5.1 or 5.2, or any part thereof, are held to be unenforceable because of the duration of such provision or the area covered thereby, the parties agree that the court making such determination shall have the power to reduce the duration and/or area of such provision and, in its reduced form, said provision shall then be enforceable.

5.6Each of the Company (including its affiliates or the officers, directors, managers, customers, partners, or shareholders of the Company or its affiliates, the “Company Group”) and the Executive agrees (whether during or after the Executive’s employment with the Company) not to issue, circulate, publish or utter any false or disparaging statements, remarks or rumors about the Executive or the Company Group, respectively, provided that nothing herein shall prohibit either the Company Group or the Executive from providing truthful testimony if such testimony is required by law.

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5.7For purposes of this Section 5 only, the term “Company” includes the Company and its subsidiaries and affiliates.

6.Inventions and Patents.

6.1The Executive agrees that all processes, technologies and inventions (collectively, “Inventions”), including new contributions, improvements, ideas and discoveries, whether patentable or not, conceived, developed, invented or made by him during the Term shall belong to the Company, provided that such Inventions grew out of the Executive’s work with the Company or any of its subsidiaries or affiliates, are related in any manner to the business (commercial or experimental) of the Company or any of its subsidiaries or affiliates or are conceived or made on the Company’s time or with the use of the Company’s facilities or materials.  The Executive shall further:  (i) promptly disclose such Inventions to the Company, (ii) assign to the Company, without additional compensation, all patent and other rights to such Inventions for the United States and foreign countries, (iii) sign all papers necessary to carry out the foregoing, and (iv) give testimony in support of the Executive’s inventorship.

6.2If any Invention is described in a patent application or is disclosed to third parties, directly or indirectly, by the Executive within two years after the termination of the Executive’s employment by the Company, it is to be presumed that the Invention was conceived or made during the Term.

6.3The Executive agrees that the Executive will not assert any rights to any Invention as having been made or acquired by the Executive prior to the date of this Agreement, except for Inventions, if any, disclosed to the Company in writing prior to the date hereof.

7.Intellectual Property.

Following the Effective Date, the Company shall be the sole owner of all the products and proceeds of the Executive’s services hereunder, including, but not limited to, all materials, ideas, concepts, formats, suggestions, developments, arrangements, packages, programs and other intellectual properties that the Executive may acquire, obtain, develop or create in connection with and during the Term, free and clear of any claims by the Executive (or anyone claiming under the Executive) of any kind or character whatsoever (other than the Executive’s right to receive payments hereunder).  The Executive shall, at the request of the Company, execute such assignments, certificates or other instruments as the Company may from time to time deem necessary or desirable to evidence, establish, maintain, perfect, protect, enforce or defend its right, title or interest in or to any such properties.

8.Notices.

All notices, requests, consents and other communications required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given if delivered personally, sent by overnight courier or mailed first class, postage prepaid, by registered or certified mail (notices mailed shall be deemed to have been given on the date mailed), as follows (or to such other address as either party shall designate by notice in writing to the other in accordance herewith):

11

 

If to the Company, to:  
Phoenix Color Corp.
Attn:  Chief Financial Officer
18249 Phoenix Drive 
Hagerstown, MD 21742

With a copy (which shall not constitute notice) to:
Shearman & Sterling LLP
1460 El Camino Real, 2nd Floor
Menlo Park, CA 94025
Attn.:  Christopher M. Forrester

If to the Executive, to:

Such address as shall most currently appear on the records of the Company.

9.Governing Law; Dispute Resolution.

9.1It is the intent of the parties hereto that all questions with respect to the construction of this Agreement and the rights and liabilities of the parties hereunder shall be determined in accordance with the laws of the State of Delaware, without regard to principles of conflicts of laws thereof that would call for the application of the substantive law of any jurisdiction other than the State of Delaware.

9.2Each party irrevocably agrees for the exclusive benefit of the other that any and all suits, actions or proceedings relating to Sections 5, 6 or 7 of this Agreement (a “Proceeding”) shall be maintained in either the courts of the State of Delaware or the federal District Courts sitting in Wilmington, Delaware (collectively, the “Chosen Courts”), and that the Chosen Courts shall have exclusive jurisdiction to hear and determine or settle any such Proceeding and that any such Proceedings shall only be brought in the Chosen Courts.  Each party irrevocably waives any objection that it may have now or hereafter to the laying of the venue of any Proceedings in the Chosen Courts and any claim that any Proceedings have been brought in an inconvenient forum and further irrevocably agrees that a judgment in any Proceeding brought in the Chosen Courts shall be conclusive and binding upon it and may be enforced in the courts of any other jurisdiction.

Each of the parties hereto agrees that this Agreement involves at least $100,000 and that this Agreement has been entered into in express reliance on Section 2708 of Title 6 of the Delaware Code.  Each of the parties hereto irrevocably and unconditionally agrees (i) that, to the extent such party is not otherwise subject to service of process in the State of Delaware, it will appoint (and maintain an agreement with respect to) an agent in the State of Delaware as such party’s agent for acceptance of legal process and notify the other parties hereto of the name and address of said agent, (ii) that service of process may also be made on such party by prepaid certified mail with a validated proof of mailing receipt constituting evidence of valid service sent to such party at the address set forth in Section 8 of this Agreement, as such address may be changed from time to time pursuant hereto, and (iii) that service made pursuant to clause (i) or (ii) above shall, to the fullest extent permitted by applicable law, have the same legal force and effect as if served upon such party personally within the State of Delaware.

12

 

9.3Any controversy or claim arising out of or related to any other provision of this Agreement shall be settled by final, binding and non-appealable arbitration in Wilmington, Delaware by a single arbitrator.  Subject to the following provisions, the arbitration shall be conducted in accordance with the applicable rules of JAMS then in effect.  Any award entered by the arbitrator shall be final, binding and nonappealable and judgment may be entered thereon by either party in accordance with applicable law in any court of competent jurisdiction.  This arbitration provision shall be specifically enforceable.  The arbitrator shall have no authority to modify any provision of this Agreement or to award a remedy for a dispute involving this Agreement other than a benefit specifically provided under or by virtue of the Agreement.  Each party shall be responsible for its own expenses relating to the conduct of the arbitration or litigation (including reasonable attorneys’ fees and expenses) and shall share the fees of JAMS and the arbitrator, if applicable, equally.

10.General.

10.1JURY TRIAL WAIVER

.  THE PARTIES EXPRESSLY AND KNOWINGLY WAIVE ANY RIGHT TO A JURY TRIAL IN THE EVENT ANY ACTION ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE EXECUTIVE’S EMPLOYMENT WITH THE COMPANY IS LITIGATED OR HEARD IN ANY COURT.

10.2Headings

.  The section headings contained herein are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement.

10.3Entire Agreement

.  This Agreement sets forth the entire agreement and understanding of the parties relating to the Executive’s employment by the Company, and supersedes all prior agreements, arrangements and understandings, written or oral, relating to the Executive’s employment by the Company and its affiliates, including, without limitation, the Prior Agreement, and any severance, retention, change in control or similar types of benefits.  No representation, promise or inducement has been made by either party that is not embodied in this Agreement, and neither party shall be bound by or liable for any alleged representation, promise or inducement not so set forth.

10.4Assignment

.  This Agreement, and the Executive’s rights and obligations hereunder, may not be assigned by the Executive.  The Company may assign its rights, together with its obligations, hereunder (i) to any affiliate or (ii) to third parties in connection with any sale, transfer or other disposition of all or substantially all of the business or assets of the Company; in any event the obligations of the Company hereunder shall be binding on its successors or assigns, whether by merger, consolidation or acquisition of all or substantially all of its business or assets.

10.5Waiver

.  This Agreement may be amended, modified, superseded, cancelled, renewed or extended and the terms or covenants hereof may be waived, only by a written instrument executed by all of the parties hereto, or in the case of a waiver, by the party waiving compliance.  The failure of either party at any time or times to require performance of any provision hereof shall in no manner affect the right at a later time to enforce the same.  No waiver by either party of the breach of any term or covenant contained in this Agreement, whether by conduct or otherwise, in any one or more instances, shall be deemed to be, or 

13

 

construed as, a further or continuing waiver of any such breach, or a waiver or the breach or any other term or covenant contained in this Agreement.

10.6Withholding  Taxes

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

11.Subsidiaries and Affiliates.

11.1As used herein, the term “subsidiary” shall mean any corporation or other business entity controlled directly or indirectly by the corporation or other business entity in question, and the term “affiliate” shall mean and include any corporation or other business entity directly or indirectly controlling, controlled by or under common control with the corporation or other business entity in question.

***

 

 

14

 

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

EXECUTIVE

By:/s/ Marc Reisch
Marc Reisch

PHOENIX COLOR CORP.

By:/s/ Brian Keck
Name:  Brian Keck
Title:  Chief Financial OfficerExhibit 4.1

 

FOURTH SUPPLEMENTAL INDENTURE 

 

between 

 

SACHEM CAPITAL CORP. 

 

and 

 

U.S. BANK NATIONAL ASSOCIATION

 

as Trustee 

 

Dated as of December 20, 2021

 

 

 

FOURTH SUPPLEMENTAL INDENTURE 

 

THIS FOURTH SUPPLEMENTAL INDENTURE
(this “Fourth Supplemental Indenture”), dated as of December 20, 2021, is between Sachem Capital Corp., a New York corporation
(the “Company”), and U.S. Bank National Association, as trustee (the “Trustee”). Except as otherwise set forth
in this Fourth Supplemental Indenture, all capitalized terms used herein shall have the meaning set forth in the Base Indenture (as defined
below).

 

RECITALS OF THE COMPANY 

 

The Company and the Trustee
executed and delivered an Indenture, dated as of June 21, 2019 (the “Base Indenture” and, as supplemented by this Fourth Supplemental
Indenture, the “Indenture”), to provide for the issuance by the Company from time to time of the Company’s unsecured
debentures, notes or other evidences of indebtedness (the “Securities”), to be issued in one or more series as provided in
the Indenture.

 

The Company desires to issue
and sell up to $45,000,000 aggregate principal amount (or up to $51,750,000 aggregate principal amount if the underwriters’ option
to purchase additional Securities is exercised in full) of the Company’s 6.00% Notes due December 30, 2026 (the “Notes”).

 

The Company previously entered
into the First Supplemental Indenture, dated as of June 21, 2019 (the “First Supplemental Indenture”), the Second Supplemental
Indenture, dated as of November 7, 2019 (the “Second Supplemental Indenture”) and the Third Supplemental Indenture, dated
as of September 4, 2020 (the “Third Supplemental Indenture”), each of which amended and supplemented the Base Indenture. None
of the First Supplemental Indenture, the Second Supplemental Indenture or the Third Supplemental Indenture are applicable to the Notes.

 

Sections 901(4) and 901(6)
of the Base Indenture provide that without the consent of Holders of the Securities of any series issued under the Indenture, the Company,
when authorized by or pursuant to a Board Resolution, and the Trustee, at any time and from time to time, may enter into one or more indentures
supplemental to the Base Indenture to (i) change or eliminate any of the provisions of the Base Indenture when there is no Security
Outstanding of any series created prior to the execution of the supplemental indenture that is entitled to the benefit of such provision
and (ii) establish the form or terms of Securities of any series as permitted by Section 201 and Section 301 of the Base
Indenture.

 

     

     

    

 

The Company desires to establish
the form and terms of the Notes and to modify, alter, supplement and change certain provisions of the Base Indenture for the benefit of
the Holders of the Notes (except as may be provided in a future supplemental indenture to the Base Indenture (“Future Supplemental
Indenture”).

 

The Company has duly authorized
the execution and delivery of this Fourth Supplemental Indenture to provide for the issuance of the Notes and all acts and things necessary
to make this Fourth Supplemental Indenture a valid, binding, and legal obligation of the Company and to constitute a valid agreement of
the Company, in accordance with its terms, have been done and performed.

 

NOW, THEREFORE, for and in
consideration of the premises and the purchase of the Notes by the Holders thereof, it is mutually agreed, for the equal and proportionate
benefit of all Holders of the Notes, as follows:

 

ARTICLE I.

 

TERMS OF THE NOTES

 

Section 1.01.  Terms of the Notes.
The following terms relating to the Notes are hereby established:

 

(a)   The Notes shall
constitute a series of Senior Securities having the title “6.00% Notes due December 30, 2026.” The Notes shall bear a CUSIP
number of 78590A 604 and an ISIN of US78590A6047.

 

(b)   The aggregate
principal amount of the Notes that may be initially authenticated and delivered under the Indenture (except for Notes authenticated and
delivered upon registration of, transfer of, or in exchange for, or in lieu of, other Notes pursuant to Sections 304, 305, 306, 906, 1107
or 1305 of the Base Indenture, and except for any Securities that, pursuant to Section 303 of the Base Indenture, are deemed never
to have been authenticated and delivered under the Indenture) shall be up to $45,000,000 (or up to $51,750,000 aggregate principal amount
if the underwriters’ option to purchase additional Securities is exercised in full). Under a Board Resolution, Officers’ Certificate
pursuant to Board Resolutions or an indenture supplement, the Company may from time to time, without the consent of the Holders of Notes,
issue additional Notes (in any such case “Additional Notes”) having the same ranking and the same interest rate, maturity
and other terms as the Notes. Any Additional Notes and the existing Notes will constitute a single series under the Indenture and all
references to the relevant Notes herein shall include the Additional Notes unless the context otherwise requires.

 

(c)   The entire outstanding
principal of the Notes shall be payable on December 30, 2026, unless earlier redeemed or repurchased in accordance with the provisions
of the Indenture.

 

 

(d)   The rate
at which the Notes shall bear interest shall be 6.00% per annum. The Interest Payment Dates for the Notes shall be March 30, June
30, September 30 and December 30 of each year, commencing March 30, 2022 (if an Interest Payment Date falls on a day that is not a
Business Day, then the applicable interest payment will be made on the next succeeding Business Day and no additional interest will
accrue as a result of such delayed payment). The initial interest period will be the period from and including December 20, 2021,
to, but excluding, March 30, 2022, and the subsequent interest periods will be the periods from and including an Interest Payment
Date to, but excluding, the next Interest Payment Date or the Stated Maturity, as the case may be; the interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date, will be paid to the Person in whose name the Note (or one or
more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, which shall be
March 15, June 15, September 15, or December 15 (whether or not a Business Day), as the case may be, immediately preceding such
Interest Payment Date. Payment of principal of (and premium, if any, on) and any such interest on the Notes will be made at the
office of the Trustee located at 111 Fillmore Avenue, St. Paul, MN 55107, Attention: Sachem Capital Corp. (6.00% Notes Due December
30, 2026) (Karen R. Beard, Vice President) or at such other address as designated by the Trustee, in such coin or currency of the
United States of America as at the time of payment is legal tender for payment of public and private debts; provided,
however, that at the option of the Company payment of interest may be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register; provided, further, however, that so long as the Notes are
registered to Cede & Co., such payment will be made by wire transfer in accordance with the procedures established by The
Depository Trust Company and the Trustee. Interest on the Notes will be computed on the basis of a 360-day year of twelve 30-day
months.

 

     

     

    

 

(e)   The Notes shall
be initially issuable in global form (each such Note, a “Global Note”). The Global Notes and the Trustee’s certificate
of authentication thereon shall be substantially in the form of Exhibit A to this Fourth Supplemental Indenture. Each Global Note
shall represent the outstanding Notes as shall be specified therein and each shall provide that it shall represent the aggregate amount
of outstanding Notes from time to time endorsed thereon and that the aggregate amount of outstanding Notes represented thereby may from
time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions. Any endorsement of a Global Note to reflect
the amount of any increase or decrease in the amount of outstanding Notes represented thereby shall be made by the Trustee or the Security
Registrar, in accordance with Sections 203 and 305 of the Base Indenture.

 

(f)    The depositary
for such Global Notes (the “Depositary”) shall be The Depository Trust Company, New York, New York. The Security Registrar
with respect to the Global Notes shall be the Trustee.

 

(g)   The Notes shall
be defeasible pursuant to Section 1402 or Section 1403 of the Base Indenture. Covenant defeasance contained in Section 1403
of the Base Indenture shall apply to the covenants contained in Sections 1006, 1008 and 1009 of the Indenture.

 

(h)   The Notes
shall be redeemable pursuant to Section 1101 of the Base Indenture and as follows:

 

(i)       
The Notes will be redeemable in whole or in part at any time or from time to time, at the option of the Company, on or after December
20, 2023, at a redemption price equal to 100% of the outstanding principal amount thereof, plus accrued and unpaid interest payments otherwise
payable for the then-current quarterly interest period accrued to, but excluding, the date fixed for redemption.

 

 

(ii)       
Notice of redemption shall be given in writing and mailed, first-class postage prepaid or by overnight courier guaranteeing next-day delivery,
to each Holder of the Notes to be redeemed, not less than thirty (30) nor more than sixty (60) days prior to the Redemption
Date, at the Holder’s address appearing in the Security Register. All notices of redemption shall contain the information set forth
in Section 1104 of the Base Indenture.

 

(iii)      
If the Company elects to redeem only a portion of the Notes, the Trustee will determine the method for selecting the particular Notes
to be redeemed, in accordance with Section 1103 of the Base Indenture and the Investment Company Act and the rules of any national
securities exchange or quotation system on which the Notes are listed, in each case to the extent applicable.

 

(iv)      
Unless the Company defaults in payment of the Redemption Price, on and after the Redemption Date, interest will cease to accrue on the
Notes called for redemption hereunder.

 

(i)     The Notes shall not
be subject to any sinking fund pursuant to Section 1201 of the Base Indenture.

 

(j)     The Notes shall be
issuable in denominations of $25 and integral multiples of $25 in excess thereof.

 

(k)   Holders of the Notes will not
have the option to have the Notes repaid prior to the Stated Maturity.

 

(l)     The Notes are hereby
designated as “Senior Securities” under the Indenture.

 

     

     

    

 

ARTICLE II.

 

COVENANTS

 

Section 2.01.  Except as may be provided
in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture,
whether now or hereafter issued and Outstanding, Article Ten of the Base Indenture shall be amended by adding the following new Sections
1009, and 1010 thereto, each as set forth below:

 

“Section 1009. Asset Coverage Ratio.

 

The Company hereby agrees
that for the period of time during which Notes are Outstanding, the Company will not pay any dividends or make any distributions in excess
of 90% of its taxable income, incur any Indebtedness or purchase any shares of its outstanding capital stock, unless, in every such case,
at the time of the incurrence of such Indebtedness or at the time of any such dividend, distribution or purchase, the Company has an Asset
Coverage of at least 150% after giving effect to the incurrence of such Indebtedness and the application of the net proceeds therefrom
or after deducting the amount of such purchase, price as the case may be. “Asset Coverage” means the ratio (expressed as a
percentage) which the total assets of the Company bears to the aggregate amount of indebtedness (including the aggregate principal amount
of the involuntary liquidation preference of redeemable preferred stock, if any), of the Company. For purposes of the Supplemental Indenture,
 “Indebtedness” means, without duplication: (a) all indebtedness for borrowed money; (b) all obligations evidenced by notes,
bonds, debentures or similar instruments; and (c) any lease of, or other arrangement conveying the right to use, any property by a Person
as lessee that has been or should be accounted for as a capital lease on a balance sheet of such Person prepared in accordance with GAAP.

 

“Section 1010. Commission Reports and Reports to Holders.

 

If, at any time, the Company
is not subject to the reporting requirements of Sections 13 or 15(d) of the Exchange Act to file any periodic reports with the Commission,
the Company agrees to furnish to the Holders of Notes and the Trustee for the period of time during which the Notes are Outstanding: (i) within
90 days after the end of the each fiscal year of the Company (which fiscal year ends on December 31), audited annual consolidated financial
statements of the Company and (ii) within 45 days after the end of each fiscal quarter of the Company (other than the Company’s
fourth fiscal quarter), unaudited interim consolidated financial statements of the Company. All such financial statements shall be prepared,
in all material respects, in accordance with GAAP.”

 

ARTICLE III.

 

MEETINGS OF HOLDERS OF SECURITIES

 

Section 3.01.  Except as may be provided
in a Future Supplemental Indenture, for the benefit of the Holders of the Notes but no other series of Securities under the Indenture,
whether now or hereafter issued and Outstanding, Section 1505 of the Base Indenture shall be amended by replacing clause (c) thereof
with the following:

 

“(c) At any meeting
of Holders, each Holder of a Security of such series or proxy shall be entitled to one vote for each $25.00 principal amount of the Outstanding
Securities of such series held or represented by such Holder; provided, however, that no vote shall be cast or counted at
any meeting in respect of any Security challenged as not Outstanding and ruled by the chairman of the meeting to be not Outstanding. The
chairman of the meeting shall have no right to vote, except as a Holder of a Security of such series or proxy.”

 

ARTICLE IV.

 

MISCELLANEOUS

 

Section 4.01.  This
FourthSupplemental Indenture and the Notes shall be governed by and construed in accordance with the law of the State of New York,
without regard to principles of conflicts of laws. This Fourth Supplemental Indenture is subject to the provisions of the Trust
Indenture Act that are required to be part of the Indenture and shall, to the extent applicable, be governed by such provisions.

 

     

     

    

 

Section 4.02.  In case any provision
in this Fourth Supplemental Indenture or in the Notes 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 4.03.  This Fourth Supplemental
Indenture may be executed in counterparts, each of which will be an original, but such counterparts will together constitute but one and
the same Fourth Supplemental Indenture. The exchange of copies of this Fourth Supplemental Indenture and of signature pages by facsimile,
..pdf transmission, email or other electronic means shall constitute effective execution and delivery of this Fourth Supplemental Indenture
for all purposes. Signatures of the parties hereto transmitted by facsimile, .pdf transmission, email or other electronic means shall
be deemed to be their original signatures for all purposes.

 

Section 4.04.  The Base Indenture,
as supplemented and amended by this Fourth Supplemental Indenture, is in all respects ratified and confirmed, and the Base Indenture and
this Fourth Supplemental Indenture shall be read, taken and construed as one and the same instrument with respect to the Notes. All provisions
included in this Fourth Supplemental Indenture supersede any conflicting provisions included in the Base Indenture with respect to the
Notes, unless not permitted by law. The Trustee accepts the trusts created by the Base Indenture, as supplemented by this Fourth Supplemental
Indenture, and agrees to perform the same upon the terms and conditions of the Base Indenture, as supplemented by this Fourth Supplemental
Indenture.

 

Section 4.05.  The provisions of this
Fourth Supplemental Indenture shall become effective as of the date hereof.

 

Section 4.06.  Notwithstanding anything
else to the contrary herein, the terms and provisions of this Fourth Supplemental Indenture shall apply only to the Notes and shall not
apply to any other series of Securities under the Base Indenture and this Fourth Supplemental Indenture shall not and does not otherwise
affect, modify, alter, supplement or change the terms and provisions of any other series of Securities under the Base Indenture, whether
now or hereafter issued and Outstanding.

 

Section 4.07.  For the avoidance
of doubt, all notices, approvals, consents, requests and any communications hereunder or with respect to the Notes must be in
writing (provided that any communication sent to Trustee hereunder must be in the form of a document that is signed manually or by
way of a digital signature provided by DocuSign or Adobe (or such other digital signature provider as specified in writing to
Trustee by the authorized representative), in English.  The Company agrees to assume all risks arising out of the use of using
digital signatures and electronic methods to submit communications to Trustee, including without limitation the risk of Trustee
acting on unauthorized instructions, and the risk of interception and misuse by Fourth parties.

 

Section 4.08.  The recitals contained
herein and in the Notes shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this Fourth Supplemental Indenture, the Notes or any Additional
Notes, except that the Trustee represents that it is duly authorized to execute and deliver this Fourth Supplemental Indenture, authenticate
the Notes and any Additional Notes and perform its obligations hereunder. The Trustee shall not be accountable for the use or application
by the Company of the Notes or any Additional Notes or the proceeds thereof. In acting hereunder and with respect to the Notes, the rights,
privileges, protections, immunities and benefits afforded to the Trustee under the Base Indenture, including, without limitation, its
right to be indemnified, are deemed to be incorporated herein, and shall be enforceable by the Trustee hereunder, in each of its capacities
hereunder as if set forth herein in full.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

     

     

    

 

IN WITNESS WHEREOF, the parties hereto have caused
this Fourth Supplemental Indenture to be duly executed as of the date first above written.

 

	 	SACHEM CAPITAL CORP.
	 	 	 
	 	By:	 /s/John l. Villano
	 	Name:	John L. Villano
	 	Title:	Chief Executive Officer
	 	 	 
	 	U.S. BANK NATIONAL

ASSOCIATION, as Trustee
	 	 
	 	By:	 /s/Karen R. Beard
	 	Name:	 Karen R. Beard
	 	Title:	 Vice President

 

[Signature page to Fourth Supplemental Indenture]

 

     

     

    

 

Exhibit A – Form of Global Note 

 

This Security is a Global
Security within the meaning of the Indenture hereinafter referred to and is registered in the name of The Depository Trust Company or
a nominee thereof. This Security may not be exchanged in whole or in part for a Security registered, and no transfer of this Security
in whole or in part may be registered, in the name of any Person other than The Depository Trust Company or a nominee thereof, except
in the limited circumstances described in the Indenture.

 

Unless this certificate
is presented by an authorized representative of The Depository Trust Company to the issuer or its agent for registration of transfer,
exchange or payment and such certificate issued in exchange for this certificate is registered in the name of Cede & Co., or
such other name as requested by an authorized representative of The Depository Trust Company, any transfer, pledge or other use hereof
for value or otherwise by or to any person is wrongful, as the registered owner hereof, Cede & Co., has an interest herein. 

 

Sachem Capital Corp. 

 

	No.	
    $                    

    CUSIP No.: 78590A 604

    ISIN:  US78590A6047

     

 

6.00% Notes due December 30, 2026

 

Sachem Capital Corp., a corporation
duly organized and existing under the laws of New York (herein called the “Company”, which term includes any successor Person
under the Indenture hereinafter referred to), for value received, hereby promises to pay to Cede & Co., or registered assigns,
the principal sum of FORTY-FIVE MILLION AND 00/100 Dollars (U.S. $45,000,000) on December 30, 2026 and to pay interest thereon from December
20, 2021 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, quarterly on March 30, June
30, September 30 and December 30 in each year, commencing March 30, 2022, at the rate of 6.00% per annum, until the principal hereof is
paid or made available for payment. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will,
as provided in such Indenture, be paid to the Person in whose name this Security is registered at the close of business on the Regular
Record Date for such interest, which shall be March 15, June 15, September 15, or December 15 (whether or not a Business
Day), as the case may be, immediately preceding such Interest Payment Date. Any such interest not so punctually paid or duly provided
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
Security 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 Securities 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 on which the Securities
of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture.
This Security may be issued as part of a series.

 

Payment of the principal of
(and premium, if any, on) and any such interest on this Security will be made at the office of the Trustee located at 111 Fillmore Avenue,
St. Paul, MN55107, Attention: Sachem Capital Corp. (6.00% Notes Due December 30, 2026) or at such other address as designated by the Trustee,
in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts;
provided, however, that at the option of the Company payment of interest may be made by check mailed to the address of the
Person entitled thereto as such address shall appear in the Security Register; provided, further, however, that so long as this
Security is registered to Cede & Co., such payment will be made by wire transfer in accordance with the procedures established
by The Depository Trust Company and the Trustee.

 

Reference is hereby made to
the further provisions of this Security 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 referred to on the reverse hereof by manual signature, this Security shall not
be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

 

IN WITNESS WHEREOF, the Company has caused this
instrument to be duly executed.

Dated:

 

	 	SACHEM CAPITAL CORP.
	 	 	 
	 	By:	 
	 	Name:
	 	Title:

 

	 	 
	Attest	 
	 	 
	By:	 	 
	 	Name:	 
	 	Title:	 

 

[Global Note - Fourth Supplemental Indenture]

 

 

CERTIFICATE OF AUTHENTICATION

 

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

 

Dated:

 

	 	U.S. BANK NATIONAL ASSOCIATION, as Trustee
	 	 	 
	 	By:	 
	 	Authorized Signatory

 

[Global Note - Fourth Supplemental Indenture]

 

     

     

    

 

Sachem Capital Corp. 

 

6.00% Notes due December 30, 2026

 

This Security is one of a
duly authorized issue of Senior Securities of the Company (herein called the “Securities”), issued and to be issued in one
or more series under an Indenture, dated as of June 21, 2019 (herein called the “Base Indenture”, which term shall have the
meaning assigned to it in such instrument), between the Company and U.S. Bank National Association, as Trustee (herein called the “Trustee”,
which term includes any successor trustee under the Base Indenture), and reference is hereby made to the Base Indenture for a statement
of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee, and the Holders of the
Securities and of the terms upon which the Securities are, and are to be, authenticated and delivered, as supplemented by the Fourth Supplemental
Indenture, dated as of December 20, 2021, by and between the Company and the Trustee (herein called the “Fourth Supplemental Indenture”;
the Fourth Supplemental Indenture and the Base Indenture collectively are herein called the “Indenture”). In the event of
any conflict between the Base Indenture and the Fourth Supplemental Indenture, the Fourth Supplemental Indenture shall govern and control.

 

This Security is one of the
series designated on the face hereof, which series is initially limited in aggregate principal amount to $45,000,000. Under a Board Resolution,
Officers’ Certificate pursuant to Board Resolutions or an indenture supplement, the Company may from time to time, without the consent
of the Holders of Securities, issue additional Securities of this series (in any such case “Additional Securities”) having
the same ranking and the same interest rate, maturity and other terms as the Securities. Any Additional Securities and the existing Securities
will constitute a single series under the Indenture and all references to the relevant Securities herein shall include the Additional
Securities unless the context otherwise requires. The aggregate amount of outstanding Securities represented hereby may from time to time
be reduced or increased, as appropriate, to reflect exchanges and redemptions.

 

The Securities of this series
are subject to redemption in whole or in part at any time or from time to time, at the option of the Company, on or after December 20,
2023, at a redemption price per security equal to 100% of the outstanding principal amount thereof plus accrued and unpaid interest payments
otherwise payable for the then-current quarterly interest period accrued to, but excluding, the date fixed for redemption.

 

Notice of redemption shall
be given in writing and mailed, first-class postage prepaid or by overnight courier guaranteeing next-day delivery, to each Holder of
the Securities to be redeemed, not less than thirty (30) nor more than sixty (60) days prior to the Redemption Date, at the
Holder’s address appearing in the Security Register. All notices of redemption shall contain the information set forth in Section 1104
of the Base Indenture.

 

If the Company elects to redeem
only a portion of the Securities, the Trustee will determine the method for selecting the particular Securities to be redeemed, in accordance
with Section 1.01 of the Fourth Supplemental Indenture and Section 1103 of the Base Indenture. In the event of redemption of
this Security in part only, a new Security or Securities of this series and of like tenor for the unredeemed portion hereof will be issued
in the name of the Holder hereof upon the cancellation hereof.

 

Unless the Company defaults
in payment of the Redemption Price, on and after the Redemption Date, interest will cease to accrue on the Securities called for redemption.

 

Holders of Securities do not have the option to
have the Securities repaid prior to December 30, 2026.

 

The Indenture contains provisions
for defeasance at any time of the entire indebtedness of this Security or certain restrictive covenants and Events of Default with respect
to this Security, in each case upon compliance with certain conditions set forth in the Indenture.

 

If an Event of Default with
respect to Securities of this series shall occur and be continuing, the principal of the Securities of this series may be declared due
and payable in the manner and with the effect provided in the Indenture.

 

     

     

    

 

The Indenture permits, with
certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the
rights of the Holders of the Securities of 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 Securities 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 Securities
of each series at the time Outstanding, on behalf of the Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver
by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent
or waiver is made upon this Security.

 

As provided in and subject
to the provisions of the Indenture, the Holder of this Security shall not have the right to institute any proceeding with respect to the
Indenture or for the appointment of a receiver or trustee or for any other remedy thereunder, unless such Holder shall have previously
given the Trustee written notice of a continuing Event of Default with respect to the Securities of this series, the Holders of not less
than 25% in principal amount of the Securities of this series at the time Outstanding shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default as Trustee and offered the Trustee indemnity, security, or both reasonably satisfactory
to the Trustee against the costs, expenses and liabilities to be incurred in compliance with such request, and the Trustee shall not have
received from the Holders of a majority in principal amount of Securities of this series at the time Outstanding a direction inconsistent
with such request, and shall have failed to institute any such proceeding, for sixty (60) days after receipt of such notice, request
and offer of indemnity and/or security. The foregoing shall not apply to any suit instituted by the Holder of this Security for the enforcement
of any payment of principal hereof or any premium or interest hereon on or after the respective due dates expressed herein.

 

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

 

As provided in the Indenture
and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Security Register, upon surrender
of this Security for registration of transfer at the office or agency of the Company in any place where the principal of and any premium
and interest on this Security are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to
the Company and the Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one
or more new Securities of this series and of like tenor, of authorized denominations and for the same aggregate principal amount, will
be issued to the designated transferee or transferees.

 

The Securities of this series
are issuable only in registered form without coupons in denominations of $25 and any integral multiples of $25 in excess thereof. As provided
in the Indenture and subject to certain limitations therein set forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series and of like tenor of a different authorized denomination, as requested by the Holder surrendering
the same.

 

No service charge shall be
made for any such registration of transfer or exchange, but the Company, the Trustee, or the Security Registrar 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 Security for registration of transfer, the Company, the Trustee, or the Security Registrar and any agent of the Company, the Trustee,
or the Security Registrar may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether
or not this Security be overdue, and none of the Company, the Trustee, the Security Registrar or any agent thereof shall be affected by
notice to the contrary.

 

All terms used in this Security which are defined
in the Indenture shall have the meanings assigned to them in the Indenture.

 

     

     

    

 

The Indenture and this Security
shall be governed by and construed in accordance with the laws of the State of New York, without regard to principles of conflicts of
laws.

 

To the extent any provision
of this Security conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.

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